SYNERGY BRANDS INC
S-8 POS, 1999-06-02
GROCERIES, GENERAL LINE
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             As filed with the Securities and Exchange Commission on
                              Registration No. 33-

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                               -------------------

                                   Form S-8/A

                             REGISTRATION STATEMENT
                                      Under
                           THE SECURITIES ACT OF 1933

                               -------------------


                               SYNERGY BRANDS INC.
                             -----------------------
               (Exact name of Issuer as specified in its charter)

          Delaware                                             22-2993066
- ---------------------------------                      ------------------------
(State or other jurisdiction of                        (I.R.S. Employer ID No.)
incorporation or organization)

                      40 Underhill Blvd., Syosset, NY 11791
       ------------------------------------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

       KRANTOR CORPORATION 1994 SERVICES AND CONSULTING COMPENSATION PLAN
       ------------------------------------------------------------------
                            (full title of the plan)

                       Mr. Henry J. Platek, Jr., President
                               Synergy Brands Inc.
                      40 Underhill Blvd., Syosset, NY 11791

                                  (516)682-1980
                               ------------------
           telephone number, including area code, of agent for service

                Please send all copies of all correspondence to:

                             Randall J. Perry, Esq.
                      159 Park Avenue, Rutherford, NJ 07070

                         CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
<S>                         <C>                <C>                <C>              <C>

                                              Proposed           Proposed
Title of                                      maximum            maximum             Amount of
securities                 Amount             offering           aggregate         registration
to be                      to be              price              offering              fee
registered              registered            per share (1)       price (1)

Common Stock              1,600,000           $ 4.49             $7,184,000          $1,437.00
$.001 par value           shares
per share

Total                     1,600,000           $ 4.49             $7,184,000          $1,437.00
                          shares
</TABLE>


(1) Estimated  solely  for the  purpose  of  calculating  the  registration  fee
    pursuant  to Rule  457(b)  and (c) on the basis of the  average  of the high
    ($6.47)  and the low ($2.50)  sales  price per share of the Common  Stock of
    Synergy  Brands Inc.  on March 31,  1999 as reported by the NASDAQ  National
    Market System.

  Page  1 of 17 pages contained in the sequential  numbering system; the Exhibit
        Index may be found on page 4 of the sequential numbering system.
<PAGE>

INTRODUCTION

The purpose for this  amendment  is to clarify that the increase in common stock
registered  per this  registration  statement  under and as part of the  Krantor
Corporation  (now known as Synergy  Brands Inc.) 1994  Services  and  Consulting
Compensation  Plan,  as amended is  1,600,000  shares,  and the Plan,  with such
additional  shares,  now  comprises  6,100,000  shares.  The  original  Plan was
comprised  of 600,000  shares  which was  subsequently  increased  by 1, 900,000
shares  in  August  1996,  and  again  by the  last  amendment  increased  by an
additional  2,000,000  shares in February 1997, the Plan being  increased in the
aggregate to a total of 4,500,000 prior to this  amendment.  This Amendment when
implemented  will increased the amount of the Company's  common stock subject to
the Plan to  6,100,000.  Exhibit  99.1 herein has been  amended to show the last
amendment to the Plan as  increasing  the amount of stock subject to the Plan by
1,600,000  shares.  The  balance of the Form S-8 to which  this is an  amendment
remains unchanged.

Item 8.  Exhibits.
         ---------

         The following are filed as exhibits to this  Registration  Statement or
incorporated herein by reference:

Exhibit No.                      Description

5.1                Opinion of Randall J. Perry, Esq. (1)

23.1               Consent of Belew Averitt LLP, independent public
                   accountants (1)

                                      -1-

<PAGE>


23.2              Consent of Randall J. Perry,  Esq.  (contained  in the opinion
                  filed as Exhibit 5.1)

99.1              Krantor Corporation 1994 Services and Consulting  Compensation
                  Plan as amended (2)

(1)  Same-no change as in S-8 filing to which this is an amendment

(2) Exhibit  corrected to clarify last  amendment as for  additional  1,600,000
shares to increase the Plan to 6, 100,000 shares

                                   SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the City of Deer  Park,  State of New York,  on this 27th day of
May, 1999.

                                       SYNERGY BRANDS INC.



                                        By: /s/ Henry J. Platek, Jr.
                                        ------------------------------------
                                                Henry J. Platek, Jr., Pres.


                                POWER OF ATTORNEY

         KNOWN ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below  constitutes  and appoints  Henry J. Platek and Mair  Faibish,  or
either one of them, his true and lawful  attorneys-in-fact and agents, with full
power of substitution  and  re-substitution  for him and in his name,  place and
stead,  in any and all  capacities,  to sign  any and all pre or post  effective
amendments  to this  Registration  Statement,  and to file  the  same  with  all
exhibits  thereto,  and  other  documents  in  connection  therewith,  with  the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and  purposes as he might or could do in person,  hereby
ratifying and confirming all that said  attorneys-in-fact  and agents, or either
of them,  or their or his  substitutes,  may  lawfully do or cause to be done by
virtue hereof.

                                      -2-

<PAGE>

         Pursuant  to the  requirements  of the  Securities  Act of  1933,  this
Registration  Statement  has  been  signed  by  the  following  persons  in  the
capacities and on the dates indicated.

Signature                                   Title                   Date

/s/ Henry J. Platek, Jr.
- ----------------------------    Director and Pres. (Prin-       May 27, 1999
    Henry J. Platek, Jr.        cipal Executive Officer)

/s/ Mair Faibish
- ----------------------------    Director, Vice President and    May 27, 1999
    Mair Faibish                Chief Financial Officer

/s/ Mitchell Gerstein
- ----------------------------    Director, Vice Pres.,           May 27, 1999
    Mitchell Gerstein           Secretary, and Treasurer


- ----------------------------    Director
    Dominic A. Marsicovetere


- ----------------------------    Director
    Michael Ferrone


                                  EXHIBIT INDEX


Exhibit No.                  Description
Numbered Doc.


5.1                 Opinion of Randall J. Perry, Esq.   (1)

23.1                Consent of Belew Averitt LLP,
                    independent public accountants  (1)

23.2                Consent of Randall J. Perry, Esq.
                    (contained in the opinion filed as
                    Exhibit 5.1)

99.1                Krantor Corporation 1994 Services and
                    Consulting Compensation Plan as amended (2)

(1)  Same-no change as in S-8 filing to which this is an amendment

(2) Exhibit  corrected to clarify last  amendment as for  additional  1,600,000
shares to increase the Plan to 6, 100,000 shares

                                      -3-



EXHIBIT 99.1

                               KRANTOR CORPORATION
                 1994 SERVICES AND CONSULTING COMPENSATION PLAN

                                TABLE OF CONTENTS

                                    ARTICLE I

                                    THE PLAN

1.1   Name................................................................ 1
1.2   Purpose ............................................................ 1
1.3   Definitions ........................................................ 1
1.4   Effective Date ..................................................... 2
1.5   Eligibility to Participate ......................................... 2
1.6   Shares Subject to the Plan ......................................... 3
1.7   Minimum Consideration or Exercise Price ............................ 3
1.8   Stock and Options Granted under the Plan ........................... 3
1.9   Reservation of Shares of Common Stock .............................. 3
1.10  Tax Withholding .................................................... 3
1.11  Exercise of Options ................................................ 4
1.12  Acceleration of Right to Exercise Options .......................... 5
1.13  Written Notice and Acknowledgment Required to Exercise Option....... 5
1.14  Compliance with Securities Laws .................................... 6
1.15  Employment of Employee ............................................. 6
1.16  Option Upon Termination of Employment .............................. 6
1.17  Termination of Employment for Cause ................................ 6
1.18  Option Upon Disability of Optionee ................................. 7
1.19  Stock or Option Upon Death of Optionee ............................. 7
1.20  Transferability .................................................... 7
1.21  Information to Optionees ........................................... 7

                                   ARTICLE II

                                 ADMINISTRATION

2.1   Committee .......................................................... 7
2.2   Action of Committee ................................................ 7
2.3   Report of Grant .................................................... 8
2.4   Company Assistance ................................................. 8

<PAGE>

                                   ARTICLE III

REGISTRATION OF PLAN SHARES .............................................. 8


                                   ARTICLE IV

                           PLAN SHARES; STOCK OPTIONS

4.1   Terms and Conditions of Stock and Option Grants .................... 9
4.2   Duration of Options ................................................ 9
4.3   Consideration; Exercise Price ...................................... 9
4.4   Individual Option Agreements ....................................... 9

                                    ARTICLE V

                      TERMINATION, AMENDMENT AND ADJUSTMENT

5.1   Termination ........................................................ 9
5.2   Amendment .......................................................... 10
5.3   Adjustments ........................................................ 10

                                   ARTICLE VI

                                  MISCELLANEOUS

6.1   Rights Under Plan .................................................. 10
6.2   Other Option Plans ................................................. 10
6.3   Plan Binding on Successors ......................................... 10
6.4   Number and Gender .................................................. 10
6.5   Headings ........................................................... 10

<PAGE>

                               KRANTOR CORPORATION
                 1994 SERVICES AND CONSULTING COMPENSATION PLAN

                                    ARTICLE I

                                    THE PLAN

   1. Name. This Plan shall be known as the "Krantor  Corporation  1994 Services
and Consulting Compensation Plan."

   1.2  Purpose.  The  purpose of this Plan is to promote the growth and general
prosperity  of the  Company by  permitting  the  Company to grant to its and its
subsidiaries' and affiliates' employees, consultants and non-employee members of
the Board of Directors, (a) shares of Common Stock of the Company or (b) Options
to purchase  shares of Common  Stock of the  Company,  as defined in Section 1.3
below captioned  "Definitions."  This Plan is designed to assist the Company and
its  subsidiaries  and  affiliates  attract and retain  superior  personnel  for
positions  of   substantial   responsibility   and  to  provide   employees  and
non-employee members of the Board with additional incentive to contribute to the
success of the Company.

   1.3 Definitions.  As used herein with initial capital letters,  the following
terms shall have the meanings  hereinafter  set forth unless the context clearly
indicates to the contrary:

         (a) "Board" shall mean the Board of Directors of the Company.

         (b) "Code" shall mean the Internal Revenue Code of 1986, as amended.

         (c) "Committee"  shall mean the Committee  appointed in accordance with
Section  2.1 or, if the  Committee  shall no longer be in  existence  or no such
Committee shall have been appointed, the Board.

         (d) "Common Stock" shall mean (i) the Common Stock, $.001 par value per
share,  of the Company or (ii)  preferred  stock of the Company  intended by the
Committee to be  convertible  into shares of such Common Stock,  $.001 par value
per share,  or (iii) if the outstanding  shares of such Common Stock,  $.001 par
value per share,  are  hereinafter  changed  into or  exchanged  for shares of a
different stock or security of the Company or some other corporation, such other
stock or security.

         (e) "Company" shall mean "Krantor Corporation," a Delaware corporation.

         (f)   "Disinterested   Person"  shall  mean  an  individual  who  is  a
"disinterested  person" within the meaning of Rule 16b-3  promulgated  under the
Exchange Act.

         (g) "Effective Date" shall mean the date of the approval of the Plan by
the Board;  provided that Options may be granted under the Plan by the Committee
contingent upon their  ratification  and approval by the Board within ten months
of such action by the Committee and provided further that no such Options may be
exercised prior to such approval.

<PAGE>


         (h)  "Employee(s)"  shall mean  employee(s)  and  consultant(s)  of the
Company  or any of its  subsidiaries  or  affiliates  and  any  other  person(s)
performing  services  for  the  Company  or  for  any  of  its  subsidiaries  or
affiliates,  with or without compensation,  to whom the Company chooses to grant
shares of Common Stock or Options in accordance with this Plan.

         (i) "Exchange Act" shall mean the  Securities  Exchange Act of 1934, as
amended.

         (j) "Fair  Market  Value"  shall mean such value as  determined  by the
Committee on the basis of such factors as it deems appropriate; provided that if
the Common Stock is listed on a national  securities exchange or transactions in
the Common Stock are quoted on the NASDAQ  National  Market  System,  such value
shall be determined  by the  Committee on the basis of the last  reported  sales
price for the Common Stock on the date for which such determination is relevant,
as reported on the national  securities  exchange or the NASDAQ  National Market
System, as the case may be; and provided further that if the Common Stock is not
listed on a national securities exchange or quoted on the NASDAQ National Market
System,  but bid and asked  quotations  on the Common Stock are  available  from
NASDAQ or a recognized stock quotation  service,  such value shall be determined
by the  Committee  on the basis of the mean  between  the  closing bid and asked
quotations for such stock on the date for which such  determination is relevant,
as reported by NASDAQ or a recognized  stock quotation  service or, in the event
that  there  shall be no bid or asked  quotations  on such stock on the date for
which such determination is relevant,  then on the basis of the mean between the
closing bid and asked quotations on such stock on the date nearest preceding the
date for which  such  determination  is  relevant  for which  such bid and asked
quotations were available.

         (k) "Option"  shall mean an Option  granted  pursuant to Article III of
this Plan.

         (l)  "Optionee"  shall mean an  employee,  consultant  or  non-employee
member of the Board to whom an Optionee has been granted hereunder.

         (m) "Option  Agreement" shall mean an agreement between the Company and
an Optionee with respect to one or more Options.

         (n) "Plan"  shall  mean the  "Krantor  Corporation  1994  Services  and
Consulting Compensation Plan," the terms of which are set forth herein.

         (o) "Plan  Shares"  shall mean the shares of Common  Stock,  as defined
herein, issuable pursuant to the Plan.

         (p) "Securities Act" shall mean the Securities Act of 1933, as amended.

   1.4 Effective Date. The Plan shall become effective upon the Effective Date.

   1.5  Eligibility to  Participate.  Any employee,  consultant or  non-employee
member of the Board of the  Company  or any of its  subsidiaries  or  affiliates
shall be eligible to participate in the Plan.

<PAGE>


   1.6 Shares  Subject to the Plan. The Plan Shares subject to the Plan shall be
600,000 shares of the Common Stock, $.001 par value per share, of the Company.

   1.7 Minimum Consideration or Exercise Price.  Notwithstanding anything to the
contrary  contained  herein, no share of Common Stock shall be granted hereunder
for  consideration  valued at less than the par  value of the  Company's  Common
Stock and no Option shall be granted  hereunder  with an exercise price which is
less than the par value of the Company's Common Stock.

   1.8 Stock and Options  Granted  Under the Plan.  Plan Shares  granted or with
respect to which Options shall have been exercised, shall not again be available
for grant  hereunder.  If Options  terminate for any reason without being wholly
exercised,  the  Company  may  grant  the  number  of Plan  Shares  to which the
termination of such Options relates or new Options  covering such number of Plan
Shares.

   1.9  Reservation of Shares of Common Stock.  During the term of the Plan, the
Company will at all times reserve and keep available for issuance such number of
shares of Common Stock as shall be necessary to satisfy the  requirements of the
Plan as to the number of Plan Shares;  which shares may be issued in whole or in
part as the Committee  shall from time to time  determine  from  authorized  but
unissued shares of Common Stock or issued shares of Common Stock which have been
reacquired  by the Company and held in the  treasury.  In addition,  the Company
will from time to time, as is necessary to accomplish  the purposes of the Plan,
use its best efforts to obtain from any  regulatory  agency having  jurisdiction
any requisite authority necessary to issue Plan Shares hereunder.  The inability
of the Company to obtain from any  regulatory  agency  having  jurisdiction  the
authority  deemed  by the  Company's  counsel  to be  necessary  for the  lawful
issuance  of any Plan Shares  shall  relieve  the  Company of any  liability  in
respect of the  non-issuance of Plan Shares as to which the requisite  authority
shall not have been obtained.

   1.10 Tax Withholding

         (a)  Conditions  Precedent.  The issuance,  delivery or exercise of any
Plan Shares or Options under the Plan is subject to the condition that if at any
time the Committee shall determine, in its discretion,  that the satisfaction of
withholding tax or other withholding  liabilities under any state or federal law
is  necessary  or  desirable  as a  condition  of, or in  connection  with,  the
issuance, delivery or exercise of the Plan Shares or Options, then the issuance,
delivery or exercise of the Plan Shares or Options shall not be effective unless
the withholding  shall have been effected or obtained in a manner  acceptable to
the Committee.

<PAGE>


         (b) Manner of  Satisfying  Withholding  Obligations.  When an  Employee
participating  in the Plan is required to pay to the Company an amount  required
to be withheld under applicable  income tax laws in connection with the grant of
Plan  Shares  or the  exercise  of an  Option,  the  Employee  may  satisfy  the
obligation,  in whole or in part, by electing to do either of the following: (i)
have the Company withhold a portion of the Plan Shares granted by the Company or
acquired  upon the  exercise of the Option which have a Fair Market Value on the
date the amount of tax to be withheld is to be determined (the "Tax Date") equal
to the amount  required to be withheld or (ii) deliver to the Company  shares of
Common Stock already owned by the Employee which have a Fair Market Value on the
Tax Date equal to the amount required to be withheld.

         (c) Special Rules for Use of Stock. An election by an Employee  subject
to  Section  16 of  the  Exchange  Act  with  respect  to the  Company's  equity
securities  to have Plan  Shares or other  shares of Common  Stock  withheld  or
delivered out of already-owned  Common Stock for this purpose will be subject to
the following restrictions, i.e., the election: (i) will be subject at all times
to the approval of the Committee;  (ii) must be made on or prior to the Tax Date
and during the period  beginning on the third business day following the date of
release of the financial  information  specified in paragraph (e)(1)(ii) of rule
16b-3 promulgated under the Exchange Act and ending on the twelfth day following
such date of release; (iii) will be irrevocable; (iv) may not be made within six
months after the date of grant of the Plan Shares or Option in question; and (v)
may  not  be  made  unless  the  Company  has  been  subject  to  the  reporting
requirements of Section 13(a) of the Exchange Act for at least one year prior to
the  election  and has filed all  reports  and  statements  required to be filed
pursuant to that Section for that year.

   1.11  Exercise of Options.

         (a) Method of Exercise.  Each Option shall be exercisable in accordance
with the terms of the Option Agreement pursuant to which the Option was granted.
No Option may be exercised for a fraction of a Plan Share.

<PAGE>

         (b) Payment of Exercise  Price.  The exercise price of any Option shall
be paid either (i) in cash, (ii) by cashier's  check,  (iii) by shares of Common
Stock,  if permitted by the Committee,  (iv) by cash or cashier's  check for the
par value of the Plan  Shares  plus a  promissory  note for the  balance  of the
exercise price,  which note shall (A) provide for full personal liability of the
maker,  (B) bear interest at the lowest rate then possible  without  causing the
maker  thereof to have income  imputed in connection  therewith,  (C) be due and
payable both as to principal  and interest five years from the date such note is
made, (D) be secured by the Plan Shares issued in connection  therewith,  (E) be
payable  in  advance  in  whole or in part  (with  the Plan  Shares  pledged  in
connection  therewith  released in the same proportion as such  pre-payment) and
(F) contain such other terms and  provisions  as the  Committee  may  determine,
including  without  limitation  the right to repay the note  partially or wholly
with Common Stock or (v) by delivery of a copy of irrevocable  instructions from
the Employee to a broker or dealer,  reasonably  acceptable  to the Company,  to
sell  certain of the Plan  Shares  purchased  upon  exercise of the Option or to
pledge them as  collateral  for a loan and  promptly  deliver to the Company the
amount of sale or loan  proceeds  necessary to pay such purchase  price.  If any
portion of the  exercise  price or a note given at the time of  exercise  of the
Option is paid in shares of Common  Stock,  those  shares shall be valued at the
then Fair Market Value.

   1.12  Acceleration  of  Right  to  Exercise  Options.   Notwithstanding   the
provisions of any Option Agreement regarding the time for exercise of an Option,
the following provisions shall apply:

         (a) Mergers  and  Reorganizations.  If the Company or its  shareholders
enter into an agreement to dispose of all or substantially  all of the assets of
the Company by means of a sale,  merger or other  reorganization or liquidation,
or  otherwise  in a  transaction  in  which  the  Company  is not the  surviving
corporation, any Option shall become immediately exercisable with respect to the
full number of shares subject to that Option during the period  commencing as of
the date of the agreement to dispose of all or  substantially  all of the assets
or stock of the  Company  and  ending  when the  disposition  of assets or stock
contemplated  by that  agreement  is  consummated  or the  Option  is  otherwise
terminated in accordance  with its  provisions or the  provisions of the Article
pursuant to which it was granted,  whichever  occurs first. The Option shall not
become immediately exercisable,  however, if the transaction contemplated in the
agreement is a merger or reorganization in which the Company will survive.

         (b)  Change  in  Control.  In the  event  of a  change  in  control  or
threatened  change in control of the Company,  all Options  granted prior to the
change in control  shall  become  immediately  exercisable.  The term "change in
control"  for  purposes of this  Section  shall refer to the  acquisition  of 20
percent  or more of the  voting  securities  of the  Company by any person or by
persons acting as a group within the meaning of Section 13(d)(3) of the Exchange
Act; provided that no change in control or threatened change in control shall be
deemed to have occurred if, prior to the  acquisition of, or offer to acquire 20
percent  or more of the  voting  securities  of the  Company,  the full Board of
Directors  shall have  adopted  by not less than  two-thirds  vote a  resolution
specifically  approving such acquisition or offer. The term "person" refers, for
purposes of this Section, to an individual or a corporation, partnership, trust,
association, joint venture, pool, syndicate, sole proprietorship, unincorporated
organization or any other form of entity not specifically listed herein. Whether
a change in control is threatened shall be determined solely by the Committee.

   1.13  Written  Notice and  Acknowledgment  Required to Exercise  Option.  Any
Option  shall be deemed to be  exercised  for  purposes of the Plan when written
notice of exercise has been received by the Company at its principal office from
the person  entitled to exercise the Option and payment for the Plan Shares with
respect to which the Option is  exercised  has been  received  by the Company in
accordance  with Section 1.11. The written notice of exercise of the Option must
be  accompanied by a written  acknowledgment  by the Employee (a) of the taxable
nature of the event and that the Employee will not hold the Company  responsible
for the reporting or payment of such taxes and (b) that, unless otherwise agreed
in writing,  the Company  will not be liable to the  Employee for its failure or
inability to cause the Plan Shares  purchased upon the exercise of the Option to
be registered with the Commission or any state securities authority.

<PAGE>


   1.14 Compliance with Securities Laws. Plan Shares shall not be granted by the
Company or issued  with  respect to any Option  unless the grant,  issuance  and
delivery of the Plan Shares and the exercise of the Option shall comply with all
relevant  provisions of federal and state law,  including without limitation the
Securities  Act,  the  rules  and  regulations  promulgated  thereunder  and the
requirements  of any  stock  exchange  upon  which the Plan  Shares  may then be
listed,  and shall be further subject to the approval of counsel for the Company
with respect to such  compliance.  The Committee may also require an Employee to
furnish  evidence  satisfactory  to the Company,  including a written and signed
representation  letter  and  consent  to be bound by any  transfer  restrictions
imposed by law, legend,  condition or otherwise,  that the Plan Shares are being
acquired  only for  investment  and  without any  present  intention  to sell or
distribute  the  shares  in  violation  of any  federal  or state  law,  rule or
regulation.  Further,  each Employee shall consent to the imposition of a legend
on the certificate representing the Plan Shares granted by the Company or issued
upon the exercise of the Option,  restricting their  transferability as required
by law or by this Section.

   1.15  Employment  of Employee.  Nothing in the Plan or in any Option  granted
hereunder  shall confer upon any Employee any right to continued  employment  by
the Company,  or any of its subsidiaries or affiliates,  or limit in any way the
right at any time of the Company,  or any subsidiary or affiliate,  to terminate
or alter the terms and  conditions of that  employment  without any liability to
the Company, or any of its subsidiaries or affiliates.

   1.16 Option  Upon  Termination  of  Employment.  If an Optionee  ceases to be
employed by the Company or any of its  subsidiaries or affiliates for any reason
other than termination for cause,  retirement,  death or disability,  his Option
may be exercised,  to the extent exercisable  pursuant to the Option grant or as
otherwise  provided by his  employment  agreement on the date of  termination of
employment,  at any time within three months  after the date of  termination  of
employment,  unless  either the Option or the  Article  pursuant to which it was
granted provides for earlier  termination.  If an Optionee ceases to be employed
by the Company or any of its subsidiaries or affiliates because the Optionee has
retired under a qualified  retirement plan of the Company,  as determined by the
Committee,  his Option shall be  exercisable  (to the extent  exercisable on the
effective  date of such  retirement)  at any time within twelve months after the
effective date of such retirement unless by its terms the Option expires sooner.

   1.17  Termination  of  Employment  for  Cause.  If an  Optionee  ceases to be
employed by the Company or any of the  subsidiaries or affiliates of the Company
because the Optionee is  terminated  for cause,  the Option shall  automatically
expire.  For  purposes  of  this  Section,  "cause"  shall  mean  an act or acts
involving a felony,  fraud,  willful misconduct,  the commission of any act that
causes, or reasonably may be expected to cause substantial injury to the Company
or other good cause. The term "other good cause," as used in this Section, shall
include,  but shall not be  limited  to,  habitual  impertinence,  a pattern  of
conduct that tends to hold the Company up to ridicule in the community,  conduct
disloyal  to the  Company,  conviction  of  any  crime  of  moral  turpitude  or
substantial dependence, as judged by the Committee, on alcohol or any controlled
substance.  "Controlled  substance" means a drug,  immediate  precursor or other
substance  listed in Schedules I-V of the New York State  Controlled  Substances
Act, as amended,  or a drug,  immediate  precursor or other substance  listed in
Schedules,  I-V of the Federal  Comprehensive  Drug Abuse Prevention and Control
Act of 1970, as amended.  Notwithstanding  the  foregoing,  if an Optionee is an
Employee employed pursuant to a written employment agreement, the Employee shall
be deemed to be  terminated  for  "cause"  for  purposes of the Plan only if the
Employee is considered under the circumstances to have been terminated for cause
for purposes of such employment agreement.

<PAGE>


   1.18 Option Upon  Disability  of Optionee.  If an Optionee  becomes  disabled
within the meaning of Section 22(e)(3) of the Code while employed by the Company
or any subsidiaries or affiliates of the Company,  his Option shall become fully
exercisable  and shall expire twelve months after the date of such  termination,
unless  either  the  Option  or the  Article  pursuant  to which  it was  issued
otherwise provides for earlier termination.

   1.19 Stock or Option Upon Death of Optionee.  Except as otherwise  limited by
the  Committee at the time of the grant of an Option,  if an Optionee dies while
employed by the Company or any of the  subsidiaries  or affiliates  thereof,  or
within  three months  after  ceasing to be an Employee,  his Option shall expire
twelve  months after the date of death,  unless by its terms it expires  sooner.
During this  twelve-month or shorter period,  the Option may be fully exercised,
to the  extent  that  it  remains  unexercised  on the  date  of  death,  by the
Optionee's personal representative or by the distributees to whom the Optionee's
rights  under  the  Option  shall  pass by will or by the  laws of  descent  and
distribution.  The estate of any  Employee  who dies while he is employed by the
Company or any  subsidiary  or affiliate  of the  Company,  shall be eligible to
receive an award of Plan Shares or an Option for up to six months  following the
Employee's death.

   1.20 Transferability. Options may not be sold, assigned, transferred, pledged
or otherwise disposed of or encumbered in any manner otherwise than by will, the
laws of descent and distribution,  or pursuant to a qualified domestic relations
order as defined by the Code; provided,  however, that an Optionee may assign or
transfer  Options  to  members  of his  immediate  family  or to a trust for the
benefit of such members of his immediate  family and, during the lifetime of the
Optionee, Options may be exercised only by the Optionee or assignee, as the case
may be, or his legally  authorized  representative.  No Employee  shall have any
right to sell, assign, transfer,  pledge or otherwise dispose of or encumber any
potential  benefit which may be granted  pursuant to the Plan, and any attempted
transfer,  sale,  assignment,  pledge or encumbrance shall have no effect on the
Company or the Committee.

   1.21  Information to Optionees.  The Company shall furnish to each Optionee a
copy of the annual  report,  proxy  statements and all other reports sent to the
Company's shareholders.  Upon written request, the Company shall furnish to each
Optionee a copy of its most recent Annual Report on Form 10-K and each quarterly
report to shareholders  issued since the end of the Company's most recent fiscal
year.

                                   ARTICLE II

                                 ADMINISTRATION

   2.1  Committee.  The  Plan  shall be  administered  by the  Board;  provided,
however, that the Board may appoint a Committee consisting of not fewer than two
members, who shall be members of the Board and who are Disinterested Persons, to
administer  this  Plan  on  behalf  of the  Board,  subject  to such  terms  and
conditions as the Board may  prescribe.  Once  appointed,  the  Committee  shall
continue to serve until otherwise  directed by the Board. From time to time, the
Board may  increase the size of the  Committee  and appoint  additional  members
thereof,  remove  members  (with or  without  cause),  appoint  new  members  in
substitution  therefor,  fill vacancies however caused and remove all members of
the Committee  and  thereafter  directly  administer  this Plan.  Subject to the
express  provisions of the Plan and the Board, the Committee shall have the sole
discretion   and  authority  to  determine  the   employees,   consultants   and
non-employee  members of the Board to whom, and the time or times at which, Plan
Shares or Options  may be granted and the number of Plan Shares to be granted or
subject to each Option. No member of the Committee shall be eligible to vote on,
or consent with respect to, any grant to him of Plan Shares or Options under the
Plan.   Notwithstanding   anything  to  the  contrary   contained  herein,   all
transactions under the Plan or with respect to any Plan Shares or Options (other
than the exercise of an outstanding Option in accordance with its terms) between
the  Company,  or any of its  subsidiaries  or  affiliates,  and any director or
officer  of the  Company,  or any of its  subsidiaries  or  affiliates,  must be
approved by a majority vote of the Committee.

   2.2 Action of  Committee.  A majority of the members of the  Committee  shall
constitute a quorum,  and any action taken by a majority at a meeting at which a
quorum is present or any action taken  without a meeting  evidenced by a writing
executed by all of the members of the Committee  shall  constitute the action of
the  Committee;  provided,  however,  that a member of the Committee may abstain
from voting on, or  consenting  to any action with respect to, any grant of Plan
Shares or Options to him, which will not affect any such action of the Committee
provided  such action is by the Board.  The Committee may appoint a secretary to
keep  minutes of its meetings  and may make such rules and  regulations  for the
conduct of its business as it shall deem  advisable.  Meetings of the  Committee
may take place by conference telephone call.

<PAGE>


   2.3 Report of Grant.  The Committee shall file with the Company's  Secretary,
within ten days  following the grant of Plan Shares or an Option to an Employee,
a written report of the grant; which report shall be made available to the other
members of the Board.

   2.4 Company Assistance.  The Company shall supply full and timely information
to the Committee on all matters relating to Employees, their employment,  death,
retirement,  disability  or other  termination  of  employment,  and such  other
pertinent  facts as the  Committee  may require.  The Company  shall furnish the
Committee  with  such  clerical  and other  assistance  as is  necessary  to the
performance of its duties.

                                   ARTICLE III

                           REGISTRATION OF PLAN SHARES

   The Company shall use its best efforts, in a commercially  reasonable manner,
to cause a  registration  statement  covering the Plan Shares to be (a) prepared
pursuant  to the Plan and to be filed  with the  United  States  Securities  and
Exchange  Commission (the "Commission") and such state "blue sky" authorities as
may be required and (b) declared  "effective"  by the  Commission and such state
authorities  (and  to  remain  "effective")  for the  purpose  of  enabling  the
Employees  who  receive  Plan Shares to have a readily  salable or  transferable
security.  The  Employees  shall not be  required  to pay any costs or  expenses
(other than sales  commissions  relating to the sale of Plan Shares) relating to
the registration and effectiveness of the registration statement relating to the
Plan Shares and the  preparation and printing of any prospectus that is required
to be delivered  in  connection  with the sale of such Plan Shares.  The Company
shall  advise each  employee who receives a grant of Plan Shares or an Option of
the rights and privileges (or limitations)  with respect to the sale or transfer
of such Plan  Shares,  and the stock  certificates  evidencing  such Plan Shares
shall  contain  such  legends as may be deemed  appropriate  or necessary by the
Company's  counsel.  The  Company's  intent  to cause  such  Plan  Shares  to be
registered with the Commission so as to be freely salable and transferable  does
not  constitute a binding or enforceable  agreement  with, or commitment to, any
person  (including  any  Employee)  that the Company will be able to effect such
registration or effectiveness, or that such Plan Shares will be salable over any
extended  period of time or that they will be  salable at any  particular  price
over such period.  The Company reserves the right, at any time, to terminate its
efforts to register the Plan Shares with the  Commission or to  discontinue  the
effectiveness of such Registration  Statement without any liability,  obligation
or penalty to any person  (including  any Employee who may have been granted any
Plan Shares or an Option). The Committee, in its discretion,  may determine that
the Company will  provide and bear the expense  (other than  commissions)  of an
underwriting  or  brokerage  mechanism  through  which  Employees  may, at their
option,  sell any Plan Shares  awarded to them or purchased upon the exercise of
Options, subject to any restrictions or limitations imposed under any applicable
federal or state securities  laws. If the Company has made any  underwritings or
brokerage  arrangements,  the Company will advise the Employees of the terms and
conditions of such arrangements,  but shall not be responsible for any action or
inaction on the part of such broker or underwriter  with respect to the purchase
of any Plan Shares from the Employee.

<PAGE>


                                   ARTICLE IV

                           PLAN SHARES; STOCK OPTIONS

   4.1 Terms and Conditions of Stock and Option Grants. The terms and conditions
relating to grants of Plan Shares and Options under this Article may differ from
one another as the Committee shall in its discretion  determine,  as long as all
grants of Plan Shares and Options under this Article satisfy the requirements of
this Article.  No Employee shall have any rights as a shareholder until the Plan
Shares have been  granted to him by the  Committee  and the grant of Plan Shares
has been accepted in writing by the Employee or the Option granted to him by the
Committee  has been  exercised  pursuant to Section  1.11.  In either case,  the
written  notice of  acceptance  of grant or the notice of exercise of the Option
must be  accompanied  by a written  acknowledgment  by the  Employee  (a) of the
taxable  nature  of the event and that the  Employee  will not hold the  Company
responsible  for the  reporting  or payment  of such taxes and (b) that,  unless
otherwise agreed in writing, the Company shall not be liable to the Employee for
its failure or  inability to cause the Plan Shares  granted to such  Employee or
purchased upon the exercise of an Option to be registered with the Commission or
any  state  securities  authority.  Certificates  representing  any Plan  Shares
awarded  or  purchased  upon the  exercise  of an Option  shall be issued to the
Employee  as  promptly  as  possible   after  the  receipt  of  the   Employee's
acknowledgment  and, with respect to Plan Shares  purchased upon the exercise of
Options, compliance with the provisions of Section 1.11.

   4.2 Duration of Options. Each Option granted pursuant to this Article and all
rights  thereunder shall expire on the date determined by the Committee,  but in
no event shall any Option granted under this Article expire later than ten years
after the date on which the Option is granted. In addition, each Option shall be
subject to early termination as provided elsewhere in the Plan.

   4.3 Consideration;  Exercise Price. The consideration received by the Company
for Plan  Shares  granted  under this  Article and the  exercise  price for Plan
Shares  acquired  pursuant to the  exercise,  in whole or in part, of any Option
granted under this Article,  shall not be less than the Fair Market Value of the
Plan Shares at the time of grant of the Plan Shares or Option.

   4.4 Individual Option Agreements. Each Optionee receiving Options pursuant to
this Article shall be required to enter into a written Option Agreement with the
Company as a  precondition  to receiving an Option under this  Article.  In such
Option  Agreement,  the  Employee  shall  agree  to be bound  by the  terms  and
conditions  of  the  Plan  and  such  other  matters  as  the  Committee   deems
appropriate.

                                    ARTICLE V

                      TERMINATION, AMENDMENT AND ADJUSTMENT

   5.1 Termination. The Plan shall terminate ten years after the Effective Date.
No Plan  Shares or  Options  shall be  granted  under the Plan after the date of
termination.

<PAGE>


   5.2  Amendment.  Subject to the  limitations  contained in this Section,  the
Committee, at any time and without any notice, may suspend or terminate the Plan
or amend or modify the terms and conditions of the Plan,  including the form and
substance of the Option Agreements to be used in connection herewith;  provided,
however,  that no amendment or modification  shall (a) increase the maximum term
established  under the Plan for any Option or (b) permit  the  granting  of Plan
Shares or an Option to anyone other than as provided in the Plan.  No amendment,
suspension,  modification or termination of the Plan shall,  without the consent
of an Employee,  alter or impair any of such  Employee's  rights or  obligations
with respect to any Plan Shares or under any Option granted under the Plan prior
to such amendment, suspension, modification or termination.

   5.3  Adjustments.  If the outstanding  Common Stock is increased,  decreased,
changed  into or  exchanged  for a  different  number or kind of shares or other
securities through merger, consolidation, combination, exchange of shares, other
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or any other change in the capital structure of the Company,
the Committee may make such appropriate and proportionate adjustment, if any, as
it  deems  appropriate  in the  maximum  number  and  kind of  shares  or  other
securities  which may be granted or as to which Options may be granted under the
Plan. A corresponding  adjustment changing the number or kind of shares or other
securities  allocated to unexercised  Options or portions  thereof,  which shall
have been  granted  prior to any such  change,  may  likewise be made.  Any such
adjustment in outstanding  Options shall be made without change in the aggregate
purchase price applicable to the unexercised  portion of the Option,  but with a
corresponding  adjustment in the price for each share of Common Stock covered by
the Option.  The  foregoing  adjustments  and the manner of  application  of the
foregoing  provisions shall be determined solely by the Committee,  and any such
adjustment may provide for the elimination of fractional share interests.

                                   ARTICLE VI

                                  MISCELLANEOUS

   6.1 Rights Under Plan.  No Employee  shall have any rights in any  provision,
term or obligation of the Company as set forth in the Plan,  whether directly or
as a third party beneficiary.

   6.2 Other Option  Plans.  The adoption of the Plan shall not affect any other
stock option or incentive or other  compensation plans in effect for the Company
or any  subsidiaries  or affiliates of the Company,  nor shall the Plan preclude
the Company or any of its subsidiaries or affiliates from establishing any other
forms of incentive or other compensation for Employees.

   6.3 Plan Binding on Successors. The Plan shall be binding upon the successors
and assigns of the Company and any of its  subsidiaries or affiliates that adopt
the Plan.

   6.4 Number and Gender.  Whenever  used herein,  nouns in the  singular  shall
include the plural where  appropriate,  and the masculine  pronoun shall include
the feminine gender.

   6.5  Headings.  Headings of articles  and  sections  hereof are  inserted for
convenience of reference and constitute no part of the Plan.


<PAGE>



   The  following  are  amendments  adopted to the  Company's  1994 Services and
Consulting Compensation Plan (the "Plan"):

   1. Paragraph  1.3(g)  "Effective Date" is amended to define Effective Date as
also the date the Plan may be amended by approval of the Committee or the Board.

   2.  Paragraph  1.6 of the Plan is hereby  amended to delete  "4,500,000"  and
replace it with "6,100,000" *

   3.  Paragraph  1.18 of the Plan is  amended to delete  the  paragraph  in its
entirety and replace it with the following language:

       "1.18 Option Upon Disability of Optionee. If an Optionee becomes disabled
       within the meaning of Section  22(e)(3) of the Code while employed by the
       Company or any  subsidiaries  or  affiliates  of the Company,  his Option
       (unless otherwise  determined by the Committee) shall be exercisable only
       to the  extent  of  those  Options  which  have  vested  on the  date  of
       disability (as determined by the Company's  disability insurance carrier,
       or if no carrier  insures the Optionee,  as determined by the  Committee)
       and only to the extent the Option  remains  unexercised at such date, and
       shall expire twelve months after the date of such  determination,  unless
       either  the  Option or the  resolution  pursuant  to which it was  issued
       otherwise provides for earlier termination."

   4.  Paragraph  1.19 of the Plan is  amended to delete  the  paragraph  in its
entirety and replace it with the following language:

       "1.19 Stock or Option Upon Death of Optionee.  If an Optionee  dies while
       employed by the Company or any of the subsidiaries or affiliates thereof,
       or within three months after ceasing to be an Employee,  his Option shall
       expire  twelve  months  after the date of  death,  unless by its terms it
       expires sooner.  During this  twelve-month or shorter period,  the Option
       (unless  otherwise  determined by the Committee) may be exercised only to
       the extent  the  Option has vested on the date of death,  and only to the
       extent the Option  remains  unexercised  on such date, by the  Optionee's
       personal  representative  or by the  distributees  to whom the Optionee's
       rights  under the Option shall pass by will or by the laws of descent and
       distribution. The estate of any Employee who dies while he is employed by
       the Company,  or any  subsidiary  or  affiliate of the Company,  shall be
       eligible  to receive  an award of Plan  Shares or an Option for up to six
       months following the Employee's death."

   5.  Paragraph  5.2 of the Plan is  amended  to delete  the  paragraph  in its
entirety and replace it with the following language:

       "5.2 Amendment. Subject to the limitations contained in this Section, the
       Committee,  at any time and without any notice,  may suspend or terminate
       the Plan or  amend or  modify  the  terms  and  conditions  of the  Plan,
       including the form and  substance of the Option  Agreements to be used in
       connection herewith; provided, however, that no amendment or modification
       shall (a) increase the maximum  term  established  under the Plan for any
       Option or (b) expand the classes of persons  eligible to receive  Options
       or Plan Shares.  Stockholder approval shall be required for any amendment
       or modification (i) if necessary to maintain  compliance of the Plan with
       Rule 16b-3  promulgated under the Exchange Act or Section 422 of the Code
       or (ii) if otherwise deemed advisable by the Committee."

*THE  AMOUNT  OF  STOCK  SUBJECT  TO THE  PLAN HAS  BEEN  INCREASED  BY  ADOPTED
AMENDMENTS IN INTEGRALS OF 1,900,000  shares in August 1996 and 2,000,000 shares
in February 1997, and is further  increased by the latest  amendment  adopted in
April 1999 by an additional 1,600,000 shares.


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