<PAGE>
Registration No. 333-
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
Registration Statement
under
The Securities Act of 1933
THE BON-TON STORES, INC.
-------------------------------------------------
(Exact name of registrant as specified in its charter)
Pennsylvania 23-2835229
------------------------ -----------------------------------
(State of incorporation) (I.R.S. Employer Identification No.)
2801 East Market Street, York, Pennsylvania 17402
-------------------------------------------------
(Address of principal executive offices) (Zip Code)
The Bon-Ton Stores, Inc. 1991 Amended and Restated Stock Option
and Restricted Stock Plan
The Bon-Ton Stores, Inc. Phantom Equity Replacement Stock Option Plan
- --------------------------------------------------------------------------------
(Full title of the plan)
Robert E. Stern, Esquire
Vice President, Secretary and General Counsel
The Bon-Ton Stores, Inc.
2801 East Market Street
York, Pennsylvania 17402
------------------------
(Name and address of agent for service)
(717) 751-3285
-------------------------------------------------------------
(Telephone number, including area code, of agent for service)
Copies to:
David Gitlin, Esquire
Wolf, Block, Schorr and Solis-Cohen LLP
Twelfth Floor Packard Building
111 South 15th Street
Philadelphia, PA 19102-2678
(215) 977-2284
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------
Proposed Proposed
Title of Maximum Maximum Amount of
Securities to be Amount to be Offering Price Aggregate Registration
Registered Registered(1) Per Share(2) Offering Price Fee
- ---------------- ------------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Common Stock, 1,388,575 shares $ 12.125 $ 16,836,472 $ 5,101.96
$0.01 par value
- -------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 416(a) under the Securities Act of 1933, as amended, this
Registration Statement also covers such additional shares as may hereafter
be offered or issued to prevent dilution resulting from stock splits, stock
dividends, recapitalizations or certain other capital adjustments.
(2) Pursuant to Rules 457(c) and 457(h)(1) under the Securities Act of 1933, as
amended, represents the average of the high and low prices for the Common
Stock on September 26, 1997, as reported on The Nasdaq National Market.
- --------------------------------------------------------------------------------
<PAGE>
PART II
-------
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
--------------------------------------------------
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The following documents filed with the Securities and Exchange
Commission pursuant to the Securities Exchange Act of 1934 are incorporated into
this Registration Statement by reference:
1. The Registrant's Annual Report on Form 10-K for the fiscal year
ended February 1, 1997.
2. The Registrant's Quarterly Reports on Form 10-Q for the quarters
ended May 4, 1997 and August 2, 1997.
3. The description of the Registrant's shares of Common Stock, $0.01
par value (the "Common Stock"), contained in the Registration Statement on Form
8-A dated September 11, 1991, as amended by Form 8 dated September 16, 1991,
filed by the Registrant to register such securities under the Securities
Exchange Act of 1934, including all amendments and reports filed for the purpose
of updating such description.
All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934 after the date of
this Registration Statement and prior to the filing of a post-effective
amendment to this Registration Statement which indicates that all securities
offered hereby have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing such documents. Any
statement contained in a document incorporated by reference herein shall be
deemed to be modified or superseded for purposes hereof to the extent that a
statement contained herein (or in any other subsequently filed document which
also is incorporated by reference herein) modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed to constitute a part
hereof except as so modified or superseded.
Item 4. Description of Securities.
-------------------------
Not Applicable.
II-1
<PAGE>
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Not Applicable.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Subchapter D (Sections 1741 through 1750) of Chapter 17 the
Pennsylvania Business Corporation Law of 1988, as amended (the "BCL"), contains
provisions for mandatory and discretionary indemnification of a corporation's
directors, officers, employees and agents (collectively "Representatives"), and
related matters.
Under Section 1741, subject to certain limitations, a corporation has
the power to indemnify directors, officers and other Representatives under
certain prescribed circumstances against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with a threatened, pending or completed action or proceeding,
whether civil, criminal, administrative or investigative, to which any of them
is a party or threatened to be made a party by reason of his being a
Representative of the corporation or serving at the request of the corporation
as a Representative of another corporation, partnership, joint venture, trust or
other enterprise, if he acted in good faith and in a manner he reasonably
believed to be in, or not opposed to, the best interests of the corporation and,
with respect to any criminal proceeding, had no reasonable cause to believe his
conduct was unlawful.
Section 1742 provides for indemnification with respect to derivative
actions similar to that provided by Section 1741. However, indemnification is
not provided under Section 1742 in respect of any claim, issue or matter as to
which a Representative has been adjudged to be liable to the corporation unless
and only to the extent that the proper court determines upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, a Representative is fairly and reasonably entitled to indemnity for
the expenses that the court deems proper.
Section 1743 provides that indemnification against expenses is
mandatory to the extent that a Representative has been successful on the merits
or otherwise in defense of any such action or proceeding referred to in Section
1741 or 1742.
Section 1744 provides that unless ordered by a court, any
indemnification under Section 1741 or 1742 shall be made by the corporation only
as authorized in the specific case upon a determination that indemnification of
a Representative is proper because the Representative met the applicable
standard of conduct, and such determination will be made by the board of
directors by a majority vote of a quorum of directors not parties to the action
or proceeding; if a quorum is not obtainable or if obtainable and a majority of
disinterested directors so directs, by independent legal counsel; or by the
shareholders.
II-2
<PAGE>
Section 1745 provides that expenses incurred by a Representative in
defending any action or proceeding referred to in Subchapter D of Chapter 17 of
the BCL may be paid by the corporation in advance of the final disposition of
such action or proceeding upon receipt of an undertaking by or on behalf of the
Representative to repay such amount if it shall ultimately be determined that he
is not entitled to be indemnified by the corporation.
Section 1746 provides generally that except in any case where the act
or failure to act giving rise to the claim for indemnification is determined by
a court to have constituted willful misconduct or recklessness, the
indemnification and advancement of expenses provided by Subchapter D of Chapter
17 of the BCL shall not be deemed exclusive of any other rights to which a
Representative seeking indemnification or advancement of expenses may be
entitled under any bylaw, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding that office.
Section 1747 grants a corporation the power to purchase and maintain
insurance on behalf of any Representative against any liability incurred by him
in his capacity as a Representative, whether or not the corporation would have
the power to indemnify him against that liability under Subchapter D of Chapter
17 of the BCL.
Sections 1748 and 1749 apply the indemnification and advancement of
expenses provisions contained in Subchapter D of Chapter 17 of the BCL to
successor corporations resulting from consolidation, merger or division and to
service as a representative of a corporation or an employee benefit plan.
Section 1750 provides that the indemnification and advancement of
expenses provided by, or granted pursuant to, Subchapter D of Chapter 17 of the
BCL shall, unless otherwise provided when authorized or ratified, continue as to
a person who has ceased to be a Representative and shall inure to the benefit of
the heirs and personal representatives of such Representative.
Section 7-2 of the Registrant's Bylaws provides that the Registrant
will indemnify any director or officer of the Registrant to the fullest extent
permitted by Pennsylvania law against all expense, liability and loss reasonably
incurred or suffered by such person in connection with any threatened, pending
or completed action, suit or proceeding (a "Proceeding") involving such person
by reason of the fact that he or she is or was a director or officer of the
Registrant or is or was serving at the request or for the benefit of the
Registrant in any capacity for another corporation or other enterprise. No
indemnification pursuant to Section 7-2 may be made, however, in any case where
the act or failure to act giving rise to the claim for indemnification is
determined by a court to have constituted willful misconduct or recklessness.
Section 7-2 further provides that the right to indemnification
includes the right to have the expenses incurred by the indemnified person in
defending any Proceeding paid by the
II-3
<PAGE>
Corporation in advance of the final disposition of the Proceeding to the fullest
extent permitted by Pennsylvania law. In addition, Section 7-2 provides that the
Registrant may purchase and maintain insurance for the benefit of any person on
behalf of whom insurance is permitted to be purchased by Pennsylvania law
against any expense, liability or loss, whether or not the Registrant would have
the power to indemnify such person under Pennsylvania or other law. The
Registrant may also purchase and maintain insurance to insure its
indemnification obligations, whether arising under the Bylaws or otherwise. In
addition, Section 7-2 states that the Registrant may create a fund of any nature
to secure in any manner its indemnification obligations, whether arising under
the Bylaws or otherwise.
Section 7-3 of the Registrant's Bylaws states that the provisions of
the Bylaws relating to indemnification constitute a contract between the
Registrant and each of its directors and officers which may be modified as to
any director or officer only with that person's consent. Further, any repeal or
amendment of the indemnification provisions of the Bylaws adverse to any
director or officer shall apply only on a prospective basis. In addition, no
repeal or amendment of the Bylaws may affect the indemnification provisions so
as to reduce or limit indemnification in any manner unless adopted by (a) the
unanimous vote of the directors of the Registrant then serving or (b) the
affirmative vote of shareholders entitled to cast not less than a majority of
the votes that all shareholders are entitled to cast in the election of
directors, provided that no such amendment will have a retroactive effect
inconsistent with the preceding sentence.
Section 7-4 of the Registrant's Bylaws states that references in
Section 7-2 and 7-3 to Pennsylvania law or any provision thereof shall be to
such law in effect on the date such sections were adopted or as such law may
thereafter be changed, provided that in the case of any change in law which
expands the liability of directors or limits the rights to indemnification or
the advancement of expenses, the rights to limited liability, indemnification
and advancement of expenses shall continue to the extent provided by law and
that if such change permits the Registrant, without further action by
shareholders or directors, to limit further the liability of directors or
officers or to provide broader rights of indemnification or advancement of
expenses, then the liability shall be limited and the rights to indemnification
and advancement of expenses shall be broadened to the extent permitted by law.
The Registrant has purchased directors and officers liability
insurance for its directors and officers.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not Applicable.
II-4
<PAGE>
Item 8. Exhibits.
--------
The following Exhibits are filed as part of this Registration
Statement:
Exhibit No.
----------
4.1 The Bon-Ton Stores, Inc. 1991 Amended and Restated
Stock Option and Restricted Stock Plan.
4.2 The Bon-Ton Stores, Inc. Phantom Equity Replacement
Stock Option Plan (incorporated by reference to
Exhibit 10.18 to the Registrant's Registration
Statement on Form S-1, File No. 33-42142).
5 Opinion of Wolf, Block, Schorr and Solis-Cohen LLP.
23.1 Consent of Arthur Andersen LLP, independent
accountants.
23.2 Consent of Wolf, Block, Schorr and Solis-Cohen LLP
(contained in Exhibit 5).
24 Power of Attorney (included on signature page in
Part II of the Registration Statement).
Item 9. Undertakings.
------------
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate, represent
a fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which is registered) and any deviation from the low or high of the estimated
II-5
<PAGE>
maximum offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b), if, in the aggregate, the changes in volume
and price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in the
effective Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(l)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-6
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
--------------------------------
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 York, Pennsylvania, on September 23, 1997.
THE BON-TON STORES, INC.
By: /s/ Heywood L. Wilansky
-----------------------------------
Heywood L. Wilansky, President and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Michael L. Gleim, the undersigned's true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for the undersigned and in the undersigned's name, place and
stead, in any and all capacities, to sign any and all amendments to this
Registration Statement (including, without limitation, 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 attorney-in-fact and agent full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated, on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Heywood L. Wilansky President, Chief Executive Officer September 23, 1997
- ----------------------------
Heywood L. Wilansky and Director (Principal Executive
Officer)
/s/ M. Thomas Grumbacher Director September 23, 1997
- ----------------------------
M. Thomas Grumbacher
</TABLE>
II-7
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Michael L. Gleim Vice Chairman, Chief Operating September 23, 1997
- ---------------------------- Officer and Director
Michael L. Gleim
/s/ Samuel J. Gerson Director September 23, 1997
- -----------------------------
Samuel J. Gerson
/s/ Roger S. Hillas Director September 23, 1997
- -----------------------------
Roger S. Hillas
/s/ Lawrence J. Ring Director September 23, 1997
- -----------------------------
Lawrence J. Ring
/s/ Leon D. Starr Director September 23, 1997
- -----------------------------
Leon D. Starr
/s/ Leon F. Winbigler Director September 23, 1997
- -----------------------------
Leon F. Winbigler
/s/ James H. Baireuther Senior Vice President September 23, 1997
- ----------------------------- and Chief Financial
James H. Baireuther Officer (Principal
Financial and Accounting
Officer)
</TABLE>
II-8
<PAGE>
THE BON-TON STORES, INC.
1991 AMENDED AND RESTATED STOCK OPTION
AND RESTRICTED STOCK PLAN AND
THE BON-TON STORES, INC. PHANTOM EQUITY REPLACEMENT STOCK OPTION PLAN
REGISTRATION STATEMENT ON FORM S-8
EXHIBIT INDEX
Exhibit No. Document
- ----------- --------
4.1 The Bon-Ton Stores, Inc. 1991 Amended and Restated Stock Option
and Restricted Stock Plan.
4.2 The Bon-Ton Stores, Inc. Phantom Equity Replacement Stock
Option Plan (incorporated by reference to Exhibit 10.18 to the
Registrant's Registration Statement on Form S-1, File No. 33-
42142).
5 Opinion of Wolf, Block, Schorr and Solis-Cohen LLP.
23.1 Consent of Arthur Andersen LLP, independent accountants.
23.2 Consent of Wolf, Block, Schorr and Solis-Cohen (contained in
Exhibit 5).
24 Power of Attorney (included on signature page in Part II of the
Registration Statement).
<PAGE>
Exhibit 4.1
As proposed
to be amended
through
6/17/97
THE BON-TON STORES, INC.
AMENDED AND RESTATED 1991 STOCK OPTION
AND RESTRICTED STOCK PLAN
--------------------------------------
1. Purpose. The Bon-Ton Stores, Inc. hereby amends and restates The
-------
Bon-Ton Stores, Inc. Amended and Restated 1991 Stock Option and Restricted Stock
Plan to be hereafter known as The Bon-Ton Stores, Inc. Amended and Restated 1991
Stock Option and Restricted Stock Plan (the "Plan"). The Plan is intended to
recognize the contributions made to the Company by employees (including
employees who are members of the Board of Directors), directors, consultants and
advisors of the Company or any Affiliate, to provide such persons with
additional incentive to devote themselves to the future success of the Company
or an Affiliate, and to improve the ability of the Company or an Affiliate to
attract, retain, and motivate individuals upon whom the Company's sustained
growth and financial success depend, by providing such persons with an
opportunity to acquire or increase their proprietary interest in the Company
through receipt of rights to acquire the Company's Common Stock, par value $.01
per share (the "Common Stock").
2. Definitions. Unless the context clearly indicates otherwise, the
-----------
following terms shall have the following meanings:
(a) "Affiliate" means a corporation which is a parent corporation
or a subsidiary corporation with respect to the Company within the meaning of
section 424(e) or (f) of the Code.
(b) "Award" means an award of Restricted Stock, granted under the
Plan, designated by the Committee at the time of such grant as an Award, and
containing the terms specified herein for Awards.
(c) "Award Document" means the document described in Section 9
which sets forth the terms and conditions of each grant of an Award.
(d) "Board of Directors" means the Board of Directors of the
Company.
(e) "Change of Control" shall have the meaning as set forth in
Section 10 of the Plan.
(f) "Code" means the Internal Revenue Code of 1986, as amended.
<PAGE>
(g) "Committee" shall have the meaning set forth in subsection
3(a).
(h) "Company" means The Bon-Ton Stores, Inc., a Pennsylvania
corporation.
(i) "Disability" shall have the meaning set forth in section
22(e)(3) of the Code.
(j) "Fair Market Value" shall have the meaning set forth in
Section 8(b) of the Plan.
(k) "Grantee" means a person who is granted Restricted Stock.
(l) "ISO" means an Option granted under the Plan which is intended
to qualify as an "incentive stock option" within the meaning of section 422(b)
of the Code.
(m) "Non-qualified Stock Option" means an Option granted under the
Plan which is not intended to qualify, or otherwise does not qualify, as an
"incentive stock option" within the meaning of section 422(b) of the Code.
(n) "Option" means either an ISO or a Non-qualified Stock Option
granted under the Plan.
(o) "Optionee" means a person to whom an Option has been granted
under the Plan, which Option has not been exercised and has not expired or
terminated.
(p) "Option Document" means the document described in Section 8
which sets forth the terms and conditions of each grant of Options.
(q) "Option Price" means the price at which Shares may be
purchased upon exercise of an Option, as calculated pursuant to subsection 8(b).
(r) "Restricted Stock" means shares issued to a person pursuant to
an Award.
(s) "Shares" means the shares of Common Stock of the Company which
are the subject of Options or Awards.
(t) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
-2-
<PAGE>
3. Administration of the Plan.
--------------------------
(a) Committee. The Plan shall be administered by the Board of
---------
Directors, or, in the discretion of the Board of Directors, by a committee
composed of two or more of the members of the Company's Board of Directors. To
the extent possible, and to the extent the Board of Directors deems it necessary
or appropriate, each member of the Committee shall be a "Non-Employee Director"
(as such term is defined in Rule 16b-3 promulgated under the Exchange Act) and
an "Outside Director" (as such term is defined in Treasury Regulations Section
1.162-27 promulgated under the Code); however, the Board may designate two
committees to operate and administer the Plan in its stead. Any of such
committees designated by the Board of Directors is referred to as the
"Committee," and, to the extent that the Plan is administered by the Board of
Directors, "Committee" shall also refer to the Board of Directors as appropriate
in the particular context. The Board of Directors may from time to time remove
members from, or add members to, the Committee. Vacancies on the Committee,
howsoever caused, shall be filled by the Board of Directors.
(b) Meetings. The Committee shall hold meetings at such times and
--------
places as it may determine. Acts approved at a meeting by a majority of the
members of the Committee or acts approved in writing by the unanimous consent of
the members of the Committee shall be the valid acts of the Committee.
(c) Grants. The Committee shall from time to time at its
------
discretion direct the Company to grant Options or Awards pursuant to the terms
of the Plan. The Committee shall have plenary authority to (i) determine the
Optionees and Grantees to whom and the times at which Options and Awards shall
be granted, (ii) determine the price at which Options shall be granted, (iii)
determine the type of Option to be granted and the number of Shares subject
thereto, (iv) determine the number of Shares to be granted pursuant to each
Award and (v) approve the form and terms and conditions of the Option Documents
and of each Award; all subject, however, to the express provisions of the Plan.
In making such determinations, the Committee may take into account the nature of
the Optionee's or Grantee's services and responsibilities, the Optionee's or
Grantee's present and potential contribution to the Company's success and such
other factors as it may deem relevant. The interpretation and construction by
the Committee of any provisions of the Plan or of any Option or Award granted
under it shall be final, binding and conclusive.
(d) Exculpation. No member of the Committee shall be personally
-----------
liable for monetary damages as such for any action taken or any failure to take
any action in connection with the administration of the Plan or the granting of
Options or Awards thereunder unless (i) the member of the Committee has breached
or failed to perform the duties of his office within the meaning of subchapter B
of Chapter 17 of the Pennsylvania Business Corporation Law of 1988, as amended,
and (ii) the breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness; provided, however, that the provisions of this
subsection 3(c) shall
-3-
<PAGE>
not apply to the responsibility or liability of a member of the Committee
pursuant to any criminal statute or to the liability of a member of the
Committee for the payment of taxes pursuant to local, state or federal law.
(e) Indemnification. Service on the Committee shall constitute
---------------
service as a member of the Board of Directors of the Company. Each member of
the Committee shall be entitled without further act on his part to indemnity
from the Company to the fullest extent provided by applicable law and the
Company's Articles of Incorporation and/or Bylaws in connection with or arising
out of any action, suit or proceeding with respect to the administration of the
Plan or the granting of Options or Awards thereunder in which he or she may be
involved by reason of his or her being or having been a member of the Committee,
whether or not he or she continues to be such member of the Committee at the
time of the action, suit or proceeding.
4. Grants of Options under the Plan. Grants of Options under the
--------------------------------
Plan may be in the form of a Non-qualified Stock Option, an ISO or a combination
thereof, at the discretion of the Committee.
5. Eligibility. All employees (including employees who are members
-----------
of the Board of Directors of the Company or its Affiliates), directors,
consultants and advisors of the Company or its Affiliates shall be eligible to
receive Options or Awards hereunder; provided, that directors (other than
directors who are employees of the Company or its Affiliates) shall not be
eligible to receive ISOs. The Committee, in its sole discretion, shall
determine whether an individual qualifies as an employee, consultant or advisor
of the Company or its Affiliates.
6. Shares Subject to Plan. The aggregate maximum number of Shares
----------------------
for which Options or Awards may be granted pursuant to the Plan is 1,900,000,
adjusted as provided in Section 11. The Shares shall be issued from authorized
and unissued Common Stock or Common Stock held in or hereafter acquired for the
treasury of the Company. If an Option terminates or expires without having been
fully exercised for any reason, or if Restricted Stock is cancelled or forfeited
pursuant to the terms of an Award, the Shares for which the Option was not
exercised or which were cancelled or forfeited pursuant to the Award may again
be the subject of an Option or Award granted pursuant to the Plan.
7. Term of the Plan. No Option or Award may be granted under the
----------------
Plan after September 15, 2001.
8. Option Documents and Terms. Each Option granted under the Plan
--------------------------
shall be a Non-qualified Stock Option unless the Option shall be specifically
designated at the time of grant to be an ISO for federal income tax purposes.
Options granted pursuant to the Plan shall be evidenced by the Option Documents
in such form as the Committee shall from time to time approve, which Option
Documents shall comply with and be subject to the following terms
-4-
<PAGE>
and conditions and such other terms and conditions as the Committee shall from
time to time require which are not inconsistent with the terms of the Plan.
(a) Number of Option Shares. Each Option Document shall state the
-----------------------
number of Shares to which it pertains. An Optionee may receive more than one
Option, which may include Options which are intended to be ISOs and Options
which are not intended to be ISOs, but only on the terms and subject to the
conditions and restrictions of the Plan. The maximum number of Shares for which
Options may be granted to any single Optionee in any fiscal year, adjusted as
provided in Section 11, shall be 500,000 Shares.
(b) Option Price. Each Option Document shall state the Option
------------
Price which, for all ISOs, shall be at least 100% of the Fair Market Value of
the Shares at the time the Option is granted as determined by the Committee in
accordance with this subsection 8(b); provided, however, that if an ISO is
granted to an Optionee who then owns, directly or by attribution under section
424(d) of the Code, shares possessing more than 10% of the total combined voting
power of all classes of stock of the Company or an Affiliate, then the Option
Price shall be at least 110% of the Fair Market Value of the Shares at the time
the Option is granted. If the Common Stock is traded in a public market, then
the Fair Market Value per share shall be, if the Shares are listed on a national
securities exchange or included in the NASDAQ National Market System, the last
reported sale price thereof on the relevant date, or, if the Shares are not so
listed or included, the mean between the last reported "bid" and "asked" prices
thereof, as reported on NASDAQ or, if not so reported, as reported by the
National Daily Quotation Bureau, Inc., or as reported in a customary financial
reporting service, as applicable and as the Committee determines, on the
relevant date. If the Common Stock is not traded in a public market on the
relevant date, the Fair Market Value shall be as determined in good faith by the
Committee.
(c) Exercise. No Option shall be deemed to have been exercised
--------
prior to the receipt by the Company of written notice of such exercise and of
payment in full of the Option Price for the Shares to be purchased. Each such
notice shall specify the number of Shares to be purchased and shall (unless the
Shares are covered by a then current registration statement or a Notification
under Regulation A under the Securities Act of 1933, as amended (the "Act")),
contain the Optionee's acknowledgment in form and substance satisfactory to the
Company that (i) such Shares are being purchased for investment and not for
distribution or resale (other than a distribution or resale which, in the
opinion of counsel satisfactory to the Company, may be made without violating
the registration provisions of the Act), (ii) the Optionee has been advised and
understands that (A) the Shares have not been registered under the Act and are
"restricted securities" within the meaning of Rule 144 under the Act and are
subject to restrictions on transfer and (B) the Company is under no obligation
to register the Shares under the Act or to take any action which would make
available to the Optionee any exemption from such registration, (iii) such
Shares may not be transferred without compliance with all applicable federal and
state securities laws, and (iv) an appropriate legend referring to
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<PAGE>
the foregoing restrictions on transfer and any other restrictions imposed under
the Option Documents may be endorsed on the certificates. Notwithstanding the
foregoing, if the Company determines that issuance of Shares should be delayed
pending (I) registration under federal or state securities laws, (II) the
receipt of an opinion that an appropriate exemption from such registration is
available, (III) the listing or inclusion of the Shares on any securities
exchange or in an automated quotation system or (IV) the consent or approval of
any governmental regulatory body whose consent or approval is necessary in
connection with the issuance of such Shares, the Company may defer exercise of
any Option granted hereunder until any of the events described in this
Subsection 8(c) has occurred.
(d) Medium of Payment. An Optionee shall pay for Shares (i) in
-----------------
cash, (ii) by certified check payable to the order of the Company, or (iii) by
such other mode of payment as the Committee may approve, including payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board. Furthermore, the Committee may provide in an Option
Document that payment may be made in whole or in part in shares of the Company's
Common Stock held by the Optionee for at least six months. If payment is made in
whole or in part in shares of the Company's Common Stock, then the Optionee
shall deliver to the Company certificates registered in the name of such
Optionee representing the shares owned by such Optionee, free of all liens,
claims and encumbrances of every kind and having an aggregate Fair Market Value
on the date of delivery that is at least as great as the Option Price of the
Shares (or relevant portion thereof) with respect to which such Option is to be
exercised by the payment in shares of Common Stock, accompanied by stock powers
duly endorsed in blank by the Optionee. Notwithstanding the foregoing, the
Committee may impose from time to time such limitations and prohibitions on the
use of shares of the Common Stock to exercise an Option as it deems appropriate.
(e) Termination of Options.
----------------------
(i) No Option shall be exercisable after the first to occur
of the following:
(A) Expiration of the Option term specified in the
Option Document, which shall not exceed (1) ten years from the date of grant, or
(2) five years from the date of grant of an ISO if the Optionee on the date of
grant owns, directly or by attribution under section 424(d) of the Code, shares
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company or of an Affiliate;
(B) Expiration of ninety (90) days from the date the
Optionee's employment or service with the Company or its Affiliates terminates
for any reason other than Disability or death or as otherwise specified in
subsection 8(e)(i)(D) or Section 10 below;
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<PAGE>
(C) Expiration of one year from the date the Optionee's
employment or service with the Company or its Affiliates terminates due to the
Optionee's Disability or death;
(D) A finding by the Committee, after full
consideration of the facts presented on behalf of both the Company and the
Optionee, that the Optionee has breached his employment or service contract with
the Company or an Affiliate, or has been engaged in any sort of disloyalty to
the Company or an Affiliate, including, without limitation, fraud, embezzlement,
theft, commission of a felony or proven dishonesty in the course of his
employment or service, or has disclosed trade secrets or confidential
information of the Company or an Affiliate. In such event, in addition to
immediate termination of the Option, the Optionee shall automatically forfeit
all Shares for which the Company has not yet delivered the share certificates
upon refund by the Company of the Option Price of such Shares. Notwithstanding
anything herein to the contrary, the Company may withhold delivery of share
certificates pending the resolution of any inquiry that could lead to a finding
resulting in a forfeiture; or
(E) The date, if any, set by the Board of Directors as
an accelerated expiration date pursuant to Section 10 hereof.
(ii) Notwithstanding the foregoing, the Committee may extend
the period during which an Option may be exercised to a date no later than the
date of the expiration of the Option term specified in the Option Documents, as
they may be amended, provided that any change pursuant to this subsection
8(e)(ii) that would cause an ISO to become a Non-qualified Stock Option may be
made only with the consent of the Optionee.
(f) Transfers. No Option granted under the Plan may be
---------
transferred, except by will or by the laws of descent and distribution. During
the lifetime of the person to whom an Option is granted, such Option may be
exercised only by him. Notwithstanding the foregoing, a Non-qualified Stock
Option may be transferred pursuant to the terms of a "qualified domestic
relations order," within the meaning of sections 401(a)(13) and 414(p) of the
Code or within the meaning of Title I of the Employee Retirement Income Security
Act of 1974, as amended.
(g) Holding Period. No Option granted under the Plan may be
--------------
exercised unless six months, or such greater period of time as may be specified
in the Option Documents, have elapsed from the date of grant.
(h) Limitation on ISO Grants. In no event shall the aggregate
------------------------
Fair Market Value of the Shares (determined at the time the ISO is granted) with
respect to which an ISO is exercisable for the first time by the Optionee during
any calendar year (under all incentive stock option plans of the Company or its
Affiliates) exceed $100,000.
-7-
<PAGE>
(i) Other Provisions. The Option Documents shall contain such
----------------
other provisions including, without limitation, provisions authorizing the
Committee to accelerate the exercisability of all or any portion of an Option
granted pursuant to the Plan, additional restrictions upon the exercise of the
Option or additional limitations upon the term of the Option, as the Committee
shall deem advisable.
(j) Amendment. The Committee shall have the right to amend Option
---------
Documents issued to an Optionee, subject to the Optionee's consent if such
amendment is not favorable to the Optionee, except that the consent of the
Optionee shall not be required for any amendment made under Section 10 of the
Plan.
9. Award Documents and Terms. Awards granted pursuant to the Plan
-------------------------
shall be evidenced by an Award Document in such form as the Committee shall from
time to time approve, which Award Document shall comply with and be subject to
the following terms and conditions and such other terms and conditions as the
Committee shall from time to time require which are not inconsistent with the
terms of the Plan. A Grantee shall not have any rights with respect to an Award
until and unless such Grantee shall have executed an Award Document containing
the terms and conditions determined by the Committee.
(a) Number of Shares and Price. Each Award Document shall state
--------------------------
the number of Shares of Restricted Stock to which it pertains. No cash or other
consideration shall be required to be paid by the Grantee for an Award.
(b) Certificates. Each Grantee shall be issued a certificate in
------------
respect of Shares subject to an Award. Such certificate shall be registered in
the name of the Grantee and shall bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Award. The Company may
require that the certificate evidencing such Shares be held by the Company until
all restrictions on such Shares have lapsed.
(c) Restrictions. Subject to the provisions of the Plan and the
------------
Award Documents, during a period set by the Committee commencing with the date
of such Award, which period shall extend for at least six months from the date
of such Award (except as provided by Paragraph 9(g)), the Grantee shall not be
permitted to sell, transfer, pledge, assign, or otherwise dispose of Shares of
Restricted Stock awarded under the Plan.
(d) Lapse of Restrictions. Subject to the provisions of the Plan
---------------------
and the Award Document, restrictions upon Shares of Restricted Stock subject to
an Award shall lapse at such time or times and on such terms and conditions as
the Committee may determine and set forth in the Award Document; provided,
however, that the restrictions upon such Shares shall lapse only if the Grantee
on the date of such lapse is, and has continuously been an employee of the
Company or its affiliates from the date such Award was granted. The Award
Document may provide for the lapse of restrictions in installments, as
determined by the Committee. In
-8-
<PAGE>
the event that a Grantee's employment terminates as a result of the Grantee's
death or Disability, all remaining restrictions with respect to such Grantee's
Restricted Stock shall immediately lapse, unless otherwise provided in the Award
Document.
(e) Rights of the Grantee. Grantees may have such rights with
---------------------
respect to the Shares subject to an Award as may be determined by the Committee
and set forth in the Award Document, including the right to vote such Shares,
and the right to receive dividends paid with the respect to such Shares.
(f) Dividends. The Committee may, in its sole discretion, provide
---------
in an Award Document, that an amount equivalent to any dividends payable with
respect to the number of Shares of Restricted Stock granted, but not yet
delivered, be invested and reinvested in additional Shares of Restricted Stock,
which shall be subject to the same restrictions as Restricted Stock to which the
dividends relate. Such Shares of Restricted Stock shall be reflected in
accordance with the terms of the Award Document, by the credit of additional
full or fractional Shares, calculated to the thousandth of a Share, in an amount
equal to the value of the declared dividend divided by the Fair Market Value of
a Share on the date of payment of the dividend. Any arrangements for the credit
of additional Shares of Restricted Stock shall terminate if, and to the extent
that, under the terms of the Award Document, the right to receive the Restricted
Stock to which the dividends relate shall terminate or lapse.
(g) Forfeiture of Restricted Stock. In the event that a Grantee's
------------------------------
employment with the Company terminates for any reason, other than because of
death or Disability, any Restricted Stock held by such Grantee which is still
subject to restrictions shall be forfeited by the Grantee and reacquired by the
Company. The Company may, in its sole discretion, waive, in whole or in part,
any remaining restrictions with respect to such Grantee's Restricted Stock.
(h) Delivery of Shares. When the restrictions imposed on
------------------
Restricted Stock expire or have been cancelled with respect to one or more
Shares (whether issued as an Award or as additional Restricted Stock pursuant to
Paragraph 9(f)), the Company shall notify the Grantee that such restrictions no
longer apply with respect to such Shares, and shall deliver to the Grantee (or
the person to whom ownership rights in such Restricted Stock may have passed by
will or the laws of descent and distribution) a certificate for the number of
Shares of Restricted Stock for which restrictions have been cancelled or have
expired, without any legend or restrictions (except those that may be imposed by
the Committee in its sole judgment to ensure compliance with the then existing
requirements of the Act and the Exchange Act). The right to payment for any
fractional Shares that may have accrued shall be satisfied in cash based on the
Fair Market Value of a Share on the date the restriction with respect to such
fractional Share lapsed or terminated.
-9-
<PAGE>
10. Change of Control. In the event of a Change of Control, the
-----------------
Committee may take whatever action with respect to Options and Awards
outstanding as it deems necessary or desirable, including, without limitation,
accelerating the expiration or termination date or the date of exercisability in
any Option Documents, or removing any restrictions from or imposing any
additional restrictions on any outstanding Awards.
A "Change of Control" shall be deemed to have occurred upon the
earliest to occur of the following events: (i) the date the shareholders of the
Company (or the Board of Directors, if shareholder action is not required)
approve a plan or other arrangement pursuant to which the Company will be
dissolved or liquidated, or (ii) the date the shareholders of the Company (or
the Board of Directors, if shareholder action is not required) approve a
definitive agreement to sell or otherwise dispose of substantially all of the
assets of the Company, or (iii) the date the shareholders of the Company (or the
Board of Directors, if shareholder action is not required) and the shareholders
of the other constituent corporation (or its board of directors if shareholder
action is not required) have approved a definitive agreement to merge or
consolidate the Company with or into such other corporation, other than, in
either case, a merger or consolidation of the Company in which holders of shares
of the Company's Common Stock or other common voting stock immediately prior to
the merger or consolidation will hold at least a majority of the ownership of
common stock of the surviving corporation (and, if one class of common stock is
not the only class of voting securities entitled to vote on the election of
directors of the surviving corporation, a majority of the voting power of the
surviving corporation's voting securities) immediately after the merger or
consolidation, which common stock (and if applicable voting securities) is to be
held in the same proportion as such holders' ownership of Common Stock or other
common voting stock of the Company immediately before the merger or
consolidation, or (iv) the date any entity, person or group (within the meaning
of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) other than M.
Thomas Grumbacher, members of his family, his lineal descendants, or entities of
which such persons are the beneficial owners of at least fifty percent (50%) of
the voting interests, the Company or any of its subsidiaries, or any employee
benefit plan (or related trust) sponsored or maintained by the Company or any of
its subsidiaries, shall have become the beneficial owner of, or shall have
obtained voting control over, outstanding shares of the Company's voting stock
representing more than fifty percent (50%) of the voting power of all of the
Company's outstanding voting stock, or (v) the first day after the date this
Plan is effective when directors constituting a majority of the Board of
Directors shall have been members of the Board of Directors for less than twelve
(12) months, unless the nomination for election of each new director who was not
a director at the beginning of such twelve (12) month period was approved by a
vote of at least two-thirds of the directors then still in office who were
directors at the beginning of such period.
11. Adjustments on Changes in Capitalization. The aggregate number
----------------------------------------
of Shares and class of Shares as to which Options and Awards may be granted
hereunder, the limitation granted to individuals set forth in Section 8(a)
hereof, the number of Shares covered by each outstanding Option or Award, and
the Option Price for each related outstanding Option,
-10-
<PAGE>
shall be appropriately adjusted in the event of a stock dividend, stock split,
recapitalization or other change in the number or class of issued and
outstanding equity securities of the Company resulting from a subdivision or
consolidation of the Common Stock and/or, if appropriate, other outstanding
equity securities or a recapitalization or other capital adjustment (not
including the issuance of Common Stock on the conversion of other securities of
the Company which are convertible into Common Stock) affecting the Common Stock
which is effected without receipt of consideration by the Company. The
Committee shall have authority to determine the adjustments to be made under
this Section, and any such determination by the Committee shall be final,
binding and conclusive; provided, however, that no adjustment shall be made
which will cause an ISO to lose its status as such without the consent of the
Optionee, except for adjustments made pursuant to Section 10 hereof.
12. Amendment of the Plan. The Board of Directors of the Company may
---------------------
amend the Plan from time to time in such manner as it may deem advisable.
Nevertheless, the Board of Directors of the Company may not: (i) change the
class of individuals eligible to receive an ISO, (ii) increase the maximum
number of Shares as to which Options or Awards may be granted, or (iii) make any
other change or amendment as to which shareholder approval is required in order
to satisfy the conditions set forth in Rule 16b-3 promulgated under the Exchange
Act in each case without obtaining approval, within twelve months before or
after such action, by (A) vote of a majority of the votes cast at a duly called
meeting of the shareholders at which a quorum representing a majority of all
outstanding voting stock of the Company is, either in person or by proxy,
present and voting on the matter or by (B) a method and in a degree that would
be treated as adequate under applicable state law for actions requiring
shareholder approval, including without limitation by written consent of
shareholders constituting a majority of all shares of outstanding voting stock
of the Company entitled to vote. No amendment to the Plan shall adversely
affect any outstanding Option or Award, however, without the consent of the
Optionee or Grantee.
13. No Commitment to Retain. The grant of an Option or Award
-----------------------
pursuant to the Plan shall not be construed to imply or to constitute evidence
of any agreement, express or implied, on the part of the Company or any
Affiliate to retain the Optionee or Grantee in the employ of the Company or an
Affiliate and/or as a member of the Company's Board of Directors or in any other
capacity.
14. Withholding of Taxes. Whenever the Company proposes or is
--------------------
required to deliver or transfer Shares in connection with an Award or the
exercise of an Option, the Company shall have the right to (a) require the
recipient to remit or otherwise make available to the Company an amount
sufficient to satisfy any federal, state and/or local withholding tax
requirements prior to the delivery or transfer of any certificate or
certificates for such Shares or (b) take whatever other action it deems
necessary to protect its interests with respect to tax liabilities. The
Company's obligation to make any delivery or transfer of Shares shall be
-11-
<PAGE>
conditioned on the Optionee's or Grantee's compliance, to the Company's
satisfaction, with any withholding requirement.
15. Interpretation. The Plan is intended to enable transactions
--------------
under the Plan with respect to directors and officers (within the meaning of
Section 16(a) under the Securities Exchange Act) to satisfy the conditions of
Rule 16b-3 promulgated under the Exchange Act; any provision of the Plan which
would cause a conflict with such conditions shall be deemed null and void to the
extent permitted by applicable law and in the discretion of the Board of
Directors.
-12-
<PAGE>
Exhibit 5
---------
LAW OFFICES
WOLF, BLOCK, SCHORR AND SOLIS-COHEN LLP
TWELFTH FLOOR PACKARD BUILDING
111 SOUTH 15TH STREET
PHILADELPHIA, PA 19102-2678
(215) 977-2000
FACSIMILE:(215) 977-2334
September 25, 1997
The Bon-Ton Stores, Inc.
2801 East Market Street
York, PA 17402
RE: Registration Statement on Form S-8
Relating to The Bon-Ton Stores, Inc. 1991 Amended and Restated Stock
Option and Restricted Stock Plan and The Bon-Ton Stores, Inc. Phantom
Equity Replacement Stock Option Plan
--------------------------------------------------------------------------
Gentlemen:
As counsel to The Bon-Ton Stores, Inc., a Pennsylvania corporation (the
"Company"), we have assisted in the preparation of a Registration Statement on
Form S-8 (the "Registration Statement") to be filed with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, relating to
1,388,575 shares of the Company's Common Stock, $0.01 par value (the "Common
Stock"), that may be issued under (i) the Company's 1991 Amended and Restated
Stock Option and Restricted Stock Plan and (ii) the Company's Phantom Equity
Replacement Stock Option Plan (together, the "Plans").
In this connection, we have examined the Company's Articles of
Incorporation and Bylaws, the Plans and such other documents and corporate
records relating to the Company and the issuance of Common Stock as we have
deemed appropriate. In all examinations of documents, instruments and other
papers, we have assumed the genuineness of all signatures on original and
certified documents and the conformity with original and certified documents of
all copies submitted to us as conformed, photostatic or other copies. As to
matters of fact which have not been independently established, we have relied
upon representations of officers of the Company.
Based upon the foregoing, it is our opinion that the shares of Common
Stock offered and to be offered under the Plans are duly authorized and, when
issued and sold pursuant to the terms of the Plans, will be legally issued,
fully paid and non-assessable.
<PAGE>
The Bon-Ton Stores, Inc.
September 25, 1997
Page 2
We hereby expressly consent to the inclusion of this opinion as an exhibit
to the Registration Statement.
Very truly Yours
/s/ WOLF, BLOCK, SCHORR AND SOLIS-COHEN LLP
Wolf, Block, Schorr and Solis-Cohen LLP
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated March 5, 1997
included and incorporated by reference in The Bon-Ton Stores, Inc. Form 10-K for
the year ended February 1, 1997 and to all references to our Firm included in
this registration statement.
ARTHUR ANDERSEN LLP
Philadelphia, Pa.
September 23, 1997
