<PAGE> 1
As filed with the Securities and Exchange Commission on June 12, 1998
Registration No. 333-_____________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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MARCUM NATURAL GAS SERVICES, INC.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 84-1169358
- ------------------------------- -------------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
1675 Broadway, Suite 2150
Denver, Colorado 80202
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(ADDRESS AND ZIP CODE OF PRINCIPAL EXECUTIVE OFFICES)
Marcum Natural Gas Services, Inc. 1998 Stock Incentive Plan
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(FULL TITLE OF THE PLAN)
A. Bradley Gabbard, Executive Vice President
Marcum Natural Gas Services, Inc.
1675 Broadway, Suite 2150
Denver, Colorado 80202
(303) 592-5555
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(NAME, ADDRESS AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
Copies to: Paul R. Hess, Esq.
Kegler, Brown, Hill & Ritter Co., L.P.A.
65 East State Street, Suite 1800
Columbus, Ohio 43215
(614) 462-5400
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
================================================================================================================================
Title of Amount Proposed Maximum Proposed Maximum Amount of Registration
Securities to be to be Offering Price Aggregate Fee
Registered Registered (1) Per Share (2) Offering Price (2)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01
per share (3) 1,000,000 shares $0.90625 $906,250 $267.35
================================================================================================================================
</TABLE>
(1) This Registration Statement also covers such additional number of shares
of Common Stock, par value $.01 per share, and other securities of Marcum
Natural Gas Services, Inc. as may be offered or issued pursuant to the
anti-dilution provisions of the above-referenced Marcum Natural Gas
Services, Inc. 1998 Stock Incentive Plan.
(2) Estimated solely for purposes of calculating the registration fee
pursuant to paragraphs (c) and (h)(1) of Rule 457 under the Securities
Act of 1933, as amended, upon the basis of the average of the high and
low sales prices of the Common Stock as reported on the Nasdaq National
Market on June 8, 1998.
(3) Includes Preferred Share Purchase Rights to purchase shares of Series B
Preferred Stock, par value $.01 per share, of Marcum Natural Gas
Services, Inc. No separate consideration will be received for the
Preferred Share Purchase Rights which, prior to the occurrence of certain
prescribed events, are not exercisable, will be evidenced by the
certificates for Common Stock and will be transferable along with and
only with the Common Stock.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with Rule
428 under the Securities Act of 1933, as amended (the "Securities Act"), and the
Note to Part I of Form S-8.
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents have been filed by Marcum Natural Gas Services,
Inc., a Delaware corporation and a small business issuer (the "Registrant" or
the "Small Business Issuer"), with the Securities and Exchange Commission (the
"Commission") pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and are hereby incorporated by reference in this Registration
Statement:
(a) The Registrant's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1997;
(b) The Registrant's Quarterly Report on Form 10-QSB for the quarterly
period ended March 31, 1998;
(c) The Registrant's Current Report on Form 8-K dated May 4, 1998 filed
with the Commission on May 12, 1998; and
(d) The description of the Common Stock, par value $.01 per share
("Common Stock"), of the Registrant, including the description of the Company's
Preferred Share Purchase Rights contained in the Registrant's Registration
Statement on Form 8-A filed with the Commission on January 10, 1993 ("Form
8-A"), as amended on Form 8-A/A Amendment No. 1 filed with the Commission on
April 3, 1998, including any amendment or report filed with the Commission for
the purpose of updating such description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment which indicates that all securities offered 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
of this Registration Statement from the date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any subsequently filed document which is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant is incorporated under the laws of the State of Delaware.
Section 145 of the General Corporation Law of the State of Delaware provides in
regard to indemnification of directors and officers as follows:
Section 145. Indemnification of Officers, Directors, Employees and
Agents; Insurance.
(a) A corporation shall have power to indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the corporation) by
reason of the fact that the person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
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reasonably incurred by the person in connection with such action, suit or
proceeding if the person acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe the person's conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendre or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which the
person reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that the person's conduct was unlawful.
(b) A corporation shall have power to indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and reasonably incurred by
the person in connection with the defense or settlement of such action or suit
if the person acted in good faith and in a manner the person reasonably believed
to be in or not opposed to the best interests of the corporation and except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper.
(c) To the extent that a present or former director or officer
of a corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of this
section, or in defense of any claim, issue or matter therein, such person shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this
section (unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
present or former director, officer, employee or agent is proper in the
circumstances because the person has met the applicable standard of conduct set
forth in subsections (a) and (b) of this section. Such determination shall be
made, with respect to a person who is a director or officer at the time of such
determination, (1) by a majority vote of the directors who are not parties to
such action, suit or proceeding, even though less than a quorum, or (2) by a
committee of such directors designated by majority vote of such directors, even
though less than a quorum, or (3) if there are no such directors, or if such
directors so direct, by independent legal counsel in a written opinion, or (4)
by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an
officer or director in defending any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that such person is not entitled to
be indemnified by the corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by former directors and officers or other
employees and agents may be so paid upon such terms and conditions, if any, as
the corporation deems appropriate.
(f) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in such
person's official capacity and as to action in another capacity while holding
such office.
(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
such person and incurred by such person in any such capacity, or arising out of
such person's status as such, whether or not the corporation would have the
power to indemnify such person against such liability under this section.
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(h) For purposes of this section, references to "the
corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
a consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and employees
or agents, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under this section with respect to the
resulting or surviving corporation as such person would have with respect to
such constituent corporation if its separate existence had continued.
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the corporation"
shall include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner such person reasonably believed to be in the interest of the participants
and beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation" as referred to in
this section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person.
(k) The Court of Chancery is hereby vested with exclusive
jurisdiction to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement, vote
of stockholders or disinterested directors, or otherwise. The Court of Chancery
may summarily determine a corporation's obligation to advance expenses
(including attorney's fees).
In accordance with Section 102(b)(7) of the General Corporation Law of
the State of Delaware, the Registrant's Restated Certificate of Incorporation,
as amended, contains a provision eliminating the personal liability of a
director of the Registrant to the Registrant and its stockholders for monetary
damages for breach of fiduciary duty as a director, except for the liability of
a director for (i) any breach of the director's duty of loyalty to the
Registrant or its stockholders; (ii) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of the law; (iii)
unlawful payment of dividends or unlawful stock purchases or redemptions; or
(iv) any transaction for which the director derived an improper personal
benefit.
Article Ninth of the Registrant's Restated Certificate of
Incorporation, as amended, provides in regard to indemnification of directors
and officers as follows:
A. The corporation may indemnify or agree to indemnify any person who
was or is a party or is threatened to be made a party, to any threatened,
pending, or completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, other than an action by or in the right of the
corporation, by reason of the fact he is or was a director, officer, employee,
or agent of the corporation, or is or was serving at the request of the
corporation as a director, trustee, officer, employee, or agent of another
corporation (including a subsidiary of this corporation), domestic or foreign,
nonprofit or for profit, partnership, joint venture, trust, or other enterprise,
against expenses, including attorneys' fees, judgments, fines, and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit, or proceeding 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 action or proceeding, had no
reasonably cause to believe his conduct was unlawful. The termination of any
action, suit, or proceeding by judgment, order, settlement, conviction, or upon
a plea of nolo contendere or its equivalent, shall not, of itself create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, he had
reasonable cause to believe that his conduct was unlawful.
B. The corporation may indemnify or agree to indemnify any person who
was or is a party, or is threatened to be made a party to any threatened,
pending, or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that he is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, trustee, officer, employee, or
agent of another corporation (including a subsidiary of this corporation),
domestic or foreign, nonprofit or for profit, partnership, joint venture, trust,
or other enterprise against expenses, including attorneys' fees, actually and
reasonably incurred by him in connection with
5
<PAGE> 6
the defense or settlement of such action or suit if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best interest
of the corporation, except that no indemnification shall be made in respect to
any claim, issue or matter as to which such person shall have been adjudged to
be liable to the corporation unless, and only to the extent that, the Court of
Chancery, or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability, but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the Court of Chancery or other such court shall
deem proper.
C. To the extent that a director, trustee, officer, employee, or agent
has been successful on the merits or otherwise in defense of any action, suit,
or proceeding referred to in sections A. and B. of this Article, or in defense
of any claim, issue, or matter therein, he shall be indemnified against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection therewith.
D. Any indemnification under sections A. and B. of this Article, unless
ordered by a court, shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the director,
trustee, officer, employee, or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in sections A. and B. of
this Article. Such determination shall be made (1) by a majority vote of a
quorum consisting of directors of the indemnifying corporation who were not and
are not parties to or threatened with any such action, suit, or proceeding, or
(2) if such a quorum is not obtainable or if a majority vote of a quorum of
disinterested directors so directs, in a written opinion by independent legal
counsel other than an attorney, or a firm having associated with it an attorney,
who has been retained by or who has performed services for the corporation or
any person to be indemnified within the past five (5) years, or (3) by the
stockholders, or (4) by the Court of Chancery or the court in which such action,
suit, or proceeding was brought. Any determination made by the disinterested
directors under section D.(1) or by independent legal counsel under section
D.(2) of this Article shall be promptly communicated to the person who
threatened or brought the action or suit by or in the right of the corporation
under Section B. of this Article, and within ten (10) days after receipt of such
notification, such person shall have the right to petition the Court of Chancery
or the court in which such action or suit was brought to review the
reasonableness of such determination.
E. No director of the corporation shall be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability (1) for any breach of the director's
duty of loyalty to the corporation or its stockholders; (2) for acts or
omissions not in good faith or which involve intentional misconduct or knowing
violation of law; (3) under Section 174 of the Delaware General Corporation Law;
or (4) for any transaction from which the director derived an improper personal
benefit.
F. Expenses, including attorneys' fees, incurred in any action, suit,
or proceeding referred to in sections A. and B. of this Article, may be paid by
the corporation in advance of the final disposition of such action, suit, or
proceedings upon receipt of a written undertaking by or on behalf of the
director, trustee, officer, employee, or agent to repay such amount, if it shall
ultimately be determined that he is not entitled to be indemnified by the
corporation as authorized in this Article. If a majority vote of a quorum of
disinterested directors so directs by resolution, said written undertaking need
not be submitted to the corporation. Such a determination that a written
undertaking need not be submitted to the corporation shall in no way affect the
entitlement of indemnification as authorized by this Article.
G. The indemnification and advancement of expenses provided in this
Article shall not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under the Restated
Certificate or the bylaws or any agreement, vote of stockholders or
disinterested directors, or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office.
H. The corporation may purchase and maintain insurance on behalf of any
person who is or was a director, trustee, officer, employee, or agent of another
corporation (including a subsidiary of this corporation), domestic or foreign,
nonprofit or for profit, partnership, joint venture, trust, or other enterprise
against any liability asserted against him and incurred by him in any such
capacity or arising out of his status as such whether or not the corporation
would have the power to indemnify him against such liability under this Article.
I. For purposes of this Article, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or agents, so that
any person who is or was a director, officer, employee, or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee, or agent of
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another corporation, partnership, joint venture, trust, or other enterprise,
shall stand in the same position under the provisions of this Article with
respect to the resulting or surviving corporation as he would have with respect
to such constituent corporation if its separate existence had continued.
J. For purposes of this Article, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to an employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee, or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee, or
agent with respect to an employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner he
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
Article.
K. The indemnification and advancement of expenses provided by, or
granted pursuant to, this Article shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee, or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
In addition, the Registrant maintains a directors' and officers'
liability insurance policy covering its directors and officers against certain
losses, including liabilities under the Securities Act, incurred by them in such
capacities to the extent such losses are not indemnified by the Registrant.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
4.1 Restated Certificate of Incorporation of Marcum Natural Gas
Services, Inc. as amended (Incorporated by reference to
Exhibit 3.1 to the Registrant's Registration Statement on Form
S-18, Registration No. 33-44558).
4.2 Bylaws of Marcum Natural Gas Services, Inc., as amended
(Incorporated by reference to Exhibit 3.2 to the Registrant's
Registration Statement on Form SB-2, Registration No.
33-82868).
4.3 Specimen Common Stock Certificate (Incorporated by reference
to Exhibit 4.1 to the Registrant's Registration Statement on
Form S-18, Registration No. 33-44558).
4.4 Rights Agreement, dated as of December 2, 1991, between Marcum
Natural Gas Services, Inc. and American Securities Transfer,
Inc. (Incorporated by reference to Exhibit 10.6 to the
Registrant's Registration Statement on Form S-18, Registration
No. 33-44558).
4.5 Amendment No. 1 to Rights Agreement, dated as of March 23,
1998, by and between Marcum Natural Gas Services, Inc. and
American Securities Transfer & Trust, Inc. (Incorporated by
reference to Exhibit 2 to the Registrant's Form 8-A/A,
Amendment No. 1 filed April 3, 1998).
4.6 Marcum Natural Gas Services, Inc. 1998 Stock Incentive Plan.
5.1 Opinion of Kegler, Brown, Hill & Ritter Co., L.P.A. on the
legality of the securities being registered.
23.1 Consent of Kegler, Brown, Hill & Ritter Co., L.P.A. (included
in Exhibit 5.1).
23.2 Consent of Deloitte & Touche LLP.
24.1 Powers of Attorney (included on the Signature Page of this
Registration Statement).
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ITEM 9. UNDERTAKINGS.
(a) The undersigned Small Business Issuer will:
(1) File, during any period in which it offers or sells
securities, a post-effective amendment to this
Registration Statement to:
(i) Include any additional or changed material
information on the plan of distribution.
(2) For determining liability under the Securities Act,
treat each post-effective amendment as a new
registration statement of the securities offered, and
the offering of the securities at that time to be the
initial bona fide offering.
(3) File a post-effective amendment to remove from
registration any of the securities being registered
that remain unsold at the end of the offering.
(b) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors, officers and
controlling persons of the Small Business Issuer pursuant to the foregoing
provisions, or otherwise, the Small Business Issuer 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 Small Business Issuer of expenses incurred or paid by a
director, officer or controlling person of the Small Business Issuer 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 Small Business Issuer 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 Securities Act and will be governed by
the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 Denver, State of Colorado on the 12th day of
June, 1998.
MARCUM NATURAL GAS SERVICES, INC.
By: /s/ W. Phillip Marcum
----------------------------------
W. Phillip Marcum, President
The Registrant and each person whose signature appears below hereby
constitutes and appoints W. Phillip Marcum, A. Bradley Gabbard and Paul R. Hess,
and each of them, with full power to act without the joinder of others, as his
or its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him or it and in his or its name, place and
stead, in any and all capacities, to sign and file any and all amendments
(including post-effective amendments) to this Registration Statement, with all
exhibits thereto, and all 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 and necessary to be done in and about the
premises, as fully to all intents and purposes as he or it might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their, his or its substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement on Form S-8 has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ W. Phillip Marcum President, Chief Executive Officer June 12, 1998
- ------------------------------------ and Director (Principal executive
W. Phillip Marcum officer)
/s/ A. Bradley Gabbard Executive Vice President, Chief Financial June 12, 1998
- ------------------------------------ Officer, Treasurer and Director
A. Bradley Gabbard (Principal financial officer)
/s/ Gary J. Zuiderveen Principal Accounting Officer, Controller June 12, 1998
- ------------------------------------ and Secretary (Principal accounting
Gary J. Zuiderveen officer)
/s/ Basil M. Briggs Director June 12, 1998
- ------------------------------------
Basil M. Briggs
/s/ Robert Lloyd Director June 12, 1998
- ------------------------------------
Robert Lloyd
/s/ Anthony D. Pell Director June 12, 1998
- ------------------------------------
Anthony D. Pell
/s/ Albert F. Thomasson Director June 12, 1998
- ------------------------------------
Albert F. Thomasson
/s/ Ronald W. McKee Director June 12, 1998
- ------------------------------------
Ronald W. McKee
/s/ Harry I. Skilton Director June 12, 1998
- ------------------------------------
Harry I. Skilton
</TABLE>
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MARCUM NATURAL GAS SERVICES, INC.
1998 STOCK INCENTIVE PLAN
FORM S-8
EXHIBIT INDEX
-------------
NUMBER DESCRIPTION OF EXHIBIT
------ ----------------------
4.1 Restated Certificate of Incorporation of Marcum Natural Gas
Services, Inc. as amended (Incorporated by reference to
Exhibit 3.1 to the Registrant's Registration Statement on Form
S-18, Registration No. 33-44558).
4.2 Bylaws of Marcum Natural Gas Services, Inc., as amended
(Incorporated by reference to Exhibit 3.2 to the Registrant's
Registration Statement on Form SB-2, Registration No.
33-82868).
4.3 Specimen Common Stock Certificate (Incorporated by reference
to Exhibit 4.1 to the Registrant's Registration Statement on
Form S-18, Registration No. 33-44558).
4.4 Rights Agreement, dated as of December 2, 1991, between Marcum
Natural Gas Services, Inc. and American Securities Transfer,
Inc. (Incorporated by reference to Exhibit 10.6 to the
Registrant's Registration Statement on Form S-18, Registration
No. 33-44558).
4.5 Amendment No. 1 to Rights Agreement, dated as of March 23,
1998, by and between Marcum Natural Gas Services, Inc. and
American Securities Transfer & Trust, Inc. (Incorporated by
reference to Exhibit 2 to the Registrant's Form 8-A/A,
Amendment No. 1 filed April 3, 1998).
4.6 Marcum Natural Gas Services, Inc. 1998 Stock Incentive Plan.
5.1 Opinion of Kegler, Brown, Hill & Ritter Co., L.P.A. on the
legality of the securities being registered.
23.1 Consent of Kegler, Brown, Hill & Ritter Co., L.P.A. (included
in Exhibit 5.1).
23.2 Consent of Deloitte & Touche LLP.
24.1 Powers of Attorney (included on the Signature Page of this
Registration Statement).
<PAGE> 1
EXHIBIT 4.6
MARCUM NATURAL GAS SERVICES, INC.
1998 STOCK INCENTIVE PLAN
SECTION 1. PURPOSES. The purposes of the Marcum Natural Gas Services,
Inc. 1998 Stock Incentive Plan (the "Plan") are to promote the long-term
interests of Marcum Natural Gas Services, Inc. and its Subsidiaries by (i)
attracting, retaining and rewarding high-quality executives and other key
employees and directors of, and advisors and consultants to, the Company and its
Subsidiaries, (ii) motivating such persons by enabling them to acquire or
increase a proprietary interest in the Company in order to align the interests
of such persons with the Company's stockholders, and (iii) providing such
persons with incentives to pursue and participate in the long-term growth,
profitability and financial success of the Company.
SECTION 2. DEFINITIONS. In addition to the terms defined elsewhere in
the Plan, the following terms as used in the Plan shall have the meanings set
forth below:
(a) "Award" means any Option, SAR (including Limited SAR), Restricted
Stock, Deferred Stock, Performance Award, Dividend Equivalent or Other
Stock-Based Award, together with any other right or interest granted to a
Participant under the Plan.
(b) "Award Agreement" means any written agreement, contract or other
instrument or document evidencing any Award which may, but need not, be executed
or acknowledged by a Participant.
(c) "Board" means the Board of Directors of the Company.
(d) "Change in Control" has the meaning given to such term in Section
9(b)(i) of the Plan.
(e) "Change in Control Price" has the meaning given to such term in
Section 9(b)(ii) of the Plan.
(f) "Code" means the Internal Revenue Code of 1986, as amended from
time to time, together with the rules, regulations and interpretations
promulgated thereunder, and any successor provisions, rules, regulations and
interpretations.
(g) "Committee" means a committee of directors designated by the Board,
in its discretion, to administer the Plan; provided, however, that, unless
otherwise determined by the Board, the Committee shall consist of two or more
directors, each of whom shall be (i) a "non-employee director" within the
meaning of Rule 16b-3 under the Exchange Act, unless administration of the Plan
by "non-employee directors" is not then required in order for exemptions under
Rule 16b-3 to apply to transactions under the Plan, and (ii) an "outside
director" as defined under Section 162(m) of the Code, unless administration of
the Plan by "outside directors" is not then required in order to qualify for tax
deductibility under Section 162(m) of the Code.
(h) "Company" means Marcum Natural Gas Services, Inc., a Delaware
corporation, together with any successor thereto.
(i) "Covered Employee" means any individual who is or, in the
determination of the Board, is likely to be a "covered employee" within the
meaning of Section 162(m) of the Code.
(j) "Deferred Stock" means a right, granted to a Participant under
Section 6(e) hereof, to receive cash, Shares, other Awards or other property
equal in value to dividends paid with respect to a specified number of Shares,
or other periodic payments.
(k) "Director" means any individual who is a member of the Board.
(l) "Director Option" means a Non-Qualified Stock Option automatically
granted to each Non-Employee Director pursuant to Section 6(b)(v) of the Plan
without any action by the Board.
4.6-1
<PAGE> 2
(m) "Dividend Equivalent" means a right granted to a Participant under
Section 6(g) hereof to receive cash, Shares, other Awards or other property
equal in value to dividends paid with respect to a specific number of Shares, or
other periodic payments.
(n) "Effective Date" means June 12, 1998.
(o) "Eligible Person" means an officer, employee or director of, or an
advisor or consultant to, the Company or a Subsidiary.
(p) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, together with the rules, regulations and
interpretations promulgated thereunder, and any successor provisions, rules,
regulations and interpretations.
(q) "Fair Market Value" means the fair market value of the property or
other item being valued, as determined by the Board in its sole discretion or by
procedures established by the Board; provided, however, that the fair market
value of Shares as of any date means the closing sale price of the Shares on
such date or, if there are no sales on such date, then the closing sale price of
the Shares on the most recent date prior to such date on which there was a sale
of Shares, as reported on the Nasdaq Stock Market, on any other quotation system
approved by the National Association of Securities Dealers, Inc. or on any
national securities exchange on which Shares are then listed or quoted, which
constitutes the primary trading market for the Shares.
(r) "Incentive Stock Option" or "ISO" means an Option that is intended
to meet the requirements of Section 422 of the Code or any successor provision
thereto and is expressly designated as an Incentive Stock Option.
(s) "Limited SAR" means a right granted to a Participant under Section
6(c) hereof.
(t) "Non-Employee Director" means a Director who is not an officer or
employee of the Company or any of its Subsidiaries on the applicable date.
(u) "Non-Qualified Stock Option" or "NQSO" means an Option that is not
intended to be an Incentive Stock Option.
(v) "Option" means a right granted under Section 6(b) hereof to
purchase Shares or other Awards at a specific price during a specific time.
(w) "Other Stock-Based Awards" means Awards granted to a Participant
under Section 6(h) hereof.
(x) "Participant" means any Eligible Person who has been granted an
Award under the Plan which remains outstanding, including a person who is no
longer an Eligible Person.
(y) "Performance Award" means a right granted under Section 8 hereof to
receive Awards based upon performance criteria specified by the Board.
(z) "Person" means any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, government or political subdivision thereof or other entity.
(aa) "Plan" means the Marcum Natural Gas Services, Inc. 1998 Stock
Incentive Plan, as amended from time to time in accordance with the provisions
hereof.
(bb) "Restricted Stock" means any Shares granted under Section 6(d)
hereof.
(cc) "Related Party" has the meaning given to such term in Section
9(b)(iii) hereof.
(dd) "Rule 16b-3" means Rule 16b-3 as from time to time in effect and
applicable to the Plan and the Participants, as promulgated and interpreted by
the SEC under Section 16 of the Exchange Act, including any successor rule
thereto.
4.6-2
<PAGE> 3
(ee) "SEC" means the Securities and Exchange Commission or any
successor thereto and shall include the staff thereof.
(ff) "Shares" means shares of common stock, par value $.01 per share,
of the Company, or such other securities of the Company as may be designated by
the Board from time to time.
(gg) "Stock Appreciation Right" or "SAR" means a right granted to a
Participant under Section 6(c) hereof, to be paid an amount measured by the
appreciation in the Fair Market Value of shares from the date of grant to the
date of exercise.
(hh) "Subsidiary" means any corporation (whether now or hereafter
existing) which, on the date of determination, qualifies as a subsidiary
corporation of the Company under Section 425(f) of the Code, and any successor
thereto.
(ii) "Voting Securities" has the meaning given to such term in Section
9(b)(iv) hereof.
SECTION 3. ADMINISTRATION.
(a) Authority of the Board. The Plan shall be administered by
the Board. Subject to the terms of the Plan and applicable law, and in addition
to other express powers and authorizations conferred on the Board by the Plan,
the Board shall have full power and authority to: (i) designate Participants;
(ii) determine the type or types of Awards to be granted to an Eligible Person;
(iii) determine the number of Awards to be granted, the number of Shares or
amount of cash or other property to which an Award will relate, the terms and
conditions of any Award (including, but not limited to, any exercise price,
grant price or purchase price, any exercise or vesting periods, any limitation
or restriction, any schedule for lapse of limitations, forfeiture restrictions
or restrictions on exercisability or transferability, and any accelerations or
waivers thereof, based in each case on such considerations as the Board shall
determine), and all other matters to be determined in connection with an Award;
(iv) determine whether, to what extent and under what circumstances Awards may
be settled or exercised in cash, Shares, other securities, other Awards or other
property, or Awards may be accumulated, vested, exchanged, surrendered,
canceled, forfeited or suspended; (v) determine whether, to what extent and
under what circumstances cash, Shares, other securities, other Awards, other
property and other amounts payable with respect to an Award shall be deferred
either automatically or at the election of the Participant or of the Committee;
(vi) interpret and administer the Plan and any instrument or agreement relating
to, or Award made under, the Plan; (vii) prescribe the form of each Award
Agreement, which need not be identical for each Participant; (viii) adopt,
amend, suspend, waive or rescind such rules and regulations and appoint such
agents as it shall deem necessary or desirable for the administration of the
Plan; (ix) correct any defect or supply any omission or reconcile any
inconsistency, and to construe and interpret the Plan, the rules and
regulations, any Award Agreement or other instrument entered into or Award made
under the Plan; and (x) make any other determinations and decisions and take any
other action that the Board deems necessary or desirable for the administration
of the Plan. Notwithstanding anything else contained in the Plan to the
contrary, neither the Committee, if any, nor the Board shall have any discretion
regarding whether an Non-Employee Director shall receive a Director Option
pursuant to Section 6(b)(v) hereof or regarding the terms of any Director Option
which are set forth in Section 6(b)(v) hereof.
(b) Exercise of Authority. Unless otherwise expressly provided
in the Plan, all designations, determinations, interpretations and other
decisions under or with respect to the Plan or any Award shall be within the
sole discretion of the Board, may be made at any time and shall be final,
conclusive and binding upon all Persons, including the Company, its
Subsidiaries, Eligible Persons, Participants, holders or beneficiaries of
Awards, and stockholders. The express grant of any specific power to the Board,
and the taking of any action by the Board, shall not be construed as limiting
any power or authority of the Board. The Board may delegate to officers or
managers of the Company or any Subsidiary, or committees thereof, the authority,
subject to such terms as the Board shall determine, to perform such functions,
including administrative functions, as the Board may determine, to the extent
that such delegation will not result in the loss of an exemption under Rule
16b-3 for Awards granted to Participants subject to Section 16 of the Exchange
Act in respect of the Company and will not cause Awards intended to qualify as
"performance-based compensation" under Section 162(m) of the Code of the Code to
fail to so qualify. The Board may appoint agents to assist it in administering
the Plan.
4.6-3
<PAGE> 4
(c) Delegation to a Committee. Notwithstanding anything to the
contrary contained herein, the Board may at any time, or from time to time,
appoint a Committee and delegate to such Committee the authority of the Board to
administer the Plan, including to the extend provided by the Board, the power to
further delegate such authority. Upon such appointment and delegation, any such
Committee shall have all the powers, privileges and duties of the Board in the
administration of the Plan to the extent provided in such delegation, except for
the power to appoint members of the Committee and to terminate, modify or amend
the Plan. The Board may from time to time appoint members of any such Committee
in substitution for or in addition to members previously appointed, may fill
vacancies in such Committee and may discharge such Committee. Any such Committee
shall hold its meetings at such times and places as it shall deem advisable. A
majority of members shall constitute a quorum and all determinations shall be
made by a majority of such quorum. Any determination reduced to writing and
signed by all of the members shall be fully as effective as if it had been made
by a majority vote at a meeting duly called and held.
(d) Limitation of Liability. The Board, the Committee, if any,
and each member of each shall be entitled to, in good faith, rely or act upon
any report or other information furnished to him or her by any executive
officer, other officer or employee of the Company or a Subsidiary, the Company's
independent auditors, legal counsel, other consultants or any other agents
assisting in the administration of the Plan. Members of the Board and of the
Committee, if any, and any officer or employee of the Company or a Subsidiary
acting at the direction or on behalf of the Board and of the Committee, if any,
shall not be personally liable for any action or determination taken or made in
good faith with respect to the Plan, and shall, to the extent permitted by law,
be fully indemnified and protected by the Company with respect to any such
action or determination.
SECTION 4. SHARES AVAILABLE FOR AWARDS.
(a) Shares Available. Subject to adjustment as provided in
Section 4(b) hereof, the total number of Shares with respect to which Awards may
be granted under the Plan shall be 1,000,000. If any Shares covered by an Award
granted under the Plan, or to which such an Award relates, are forfeited, or if
an Award otherwise terminates or is canceled without the delivery of Shares, or
if payment is made to the Participant in the form of cash or other property
other than Shares, then the Shares covered by such Award, or to which such Award
relates, or the number of Shares otherwise counted against the aggregate number
of Shares with respect to which Awards may be granted, to the extent of any such
settlement, forfeiture, termination or cancellation, shall again be, or shall
become, Shares with respect to which Awards may be granted, to the extent
permissible under Rule 16b-3. In the event that any Option or other Award
granted hereunder is exercised through the delivery of Shares, the number of
Shares available for Awards under the Plan shall be increased by the number of
Shares surrendered, to the extent permissible under Rule 16b-3. For purposes of
this Section 4(a), the number of Shares to which an Award relates shall be
counted against the number of Shares reserved and available under the Plan at
the time of grant of the Award, unless such number of Shares cannot be
determined at that time, in which case the number of Shares actually distributed
pursuant to the Award shall be counted against the number of Shares reserved and
available under the Plan at the time of distribution; provided, however, that
Awards related to or retroactively added to, or granted in tandem with,
substituted for or converted into, other Awards shall be counted or not counted
against the number of Shares reserved and available under the Plan in accordance
with procedures adopted by the Committee so as to ensure appropriate counting
but avoid double counting; and provided, further, that the number of Shares
deemed to be issued under the Plan upon exercise of an Option or an Other
Stock-Based Award in the nature of a stock purchase right shall be reduced by
the number of Shares surrendered by the Participant in payment of the exercise
or purchase price of the Award.
(b) Adjustments. In the event that any dividend or other
distribution (whether in the form of cash, Shares, other securities or other
property), recapitalization, forward or reverse stock split, reorganization,
merger, consolidation, split-up, spin-off, combination, repurchase, liquidation,
dissolution, exchange of Shares or other securities of the Company, or other
similar corporate transaction or event affects the Shares such that an
adjustment is necessary or determined by the Board to be appropriate in order to
prevent dilution or enlargement of the Participants' rights under the Plan, then
the Board shall proportionately adjust any or all of (i) the number and kind of
Shares or other securities of the Company (or number and kind of other
securities or property) which may thereafter be issued in connection with
Awards; (ii) the number and kind of Shares or other securities of the Company
(or number and kind of other securities or property) issued or issuable with
respect to outstanding Awards; and (iii) the grant, exercise or purchase price
with respect to any Award; provided, in each case, that with respect to Awards
of Incentive Stock Options, no such adjustment shall be authorized to the extent
that such authority would cause the Plan to violate Section 422(b)(1) of the
Code, as from time to
4.6-4
<PAGE> 5
time amended. If, pursuant to the preceding sentence, an adjustment is made to
outstanding Options held by Participants, a corresponding adjustment shall be
made to outstanding Director Options and if, pursuant to the preceding sentence,
an adjustment is made to the number of Shares authorized for issuance under the
Plan, a corresponding adjustment shall be made to the number of Shares subject
to each Director Option thereafter granted pursuant to Section 6(b)(v).
(c) Sources of Shares. Any Shares delivered pursuant to an
Award may consist, in whole or in part, of authorized and unissued Shares or of
treasury Shares, including Shares repurchased by the Company for purposes of the
Plan.
(d) Annual Limits on Awards. Subject to adjustment as provided
in Section 4(b) hereof the maximum number of Shares subject to Awards in any
combination that may be granted during any one fiscal year of the Company to any
one Participant shall be limited to 100,000.
SECTION 5. ELIGIBILITY. Awards may be granted under the Plan only to
Eligible Persons, except that (a) only Eligible Persons who are employees of the
Company or a Subsidiary shall be eligible for the grant of Incentive Stock
Options, and (b) only Non-Employee Directors shall receive Director Options in
accordance with Section 6(b)(v) hereof.
SECTION 6. SPECIFIC TERMS OF AWARDS.
(a) General. Subject to the provisions of the Plan and any
applicable Award Agreement, Awards may be granted as set forth in this Section
6. In addition, the Board may impose on any Award or the exercise thereof, at
the date of grant or thereafter (subject to the terms of Section 10 hereof),
such additional terms and conditions, not inconsistent with the provisions of
the Plan, as the Board shall determine, including terms requiring forfeiture of
Awards in the event of termination of employment by the Participant and terms
permitting a Participant to make elections pertaining to his Award. Subject to
the provisions of the Plan, the Board shall have the right to accelerate the
vesting or exercising of any Award granted under the Plan. Except as provided in
Section 7(a) hereof, or as required by applicable law, Awards shall be granted
for no consideration other than prior and future services.
(b) Options. Subject to the provisions of the Plan, the Board
is authorized to grant Options to Eligible Persons on the following terms and
conditions:
(i) Exercise Price. The exercise price per Share of
an Option shall be determined by the Board; provided, however, that,
except as provided in Section 7(a), such exercise price shall not be
less than the Fair Market Value of a Share on the date of grant of such
Option.
(ii) Option Term. The term of each Option shall be
determined by the Board.
(iii) Methods of Exercise. The Board shall determine
the time or times at which or the circumstances under which an Option
may be exercised in whole or in part (including based on achievement of
performance goals and/or service requirements), the methods by which
such exercise price may be paid or deemed to be paid, and the form of
such payment, including, without limitation, cash, Shares, other
outstanding Awards or other property (including notes or other
contractual obligations of Participants to make payment on a deferred
bases, to the extent permitted by law) or any combination thereof,
having a Fair Market Value equal to the exercise price.
(iv) Incentive Stock Options. The terms of any
Incentive Stock Option granted under the Plan shall comply in all
material respects with the provisions of Section 422 of the Code or any
successor provision thereto. Incentive Stock Options may only be issued
to employees of the Company or a Subsidiary. Anything in the Plan to
the contrary notwithstanding, no term of the Plan relating to ISOs
(including any SAR in tandem therewith) shall be interpreted, amended
or altered, nor shall any discretion or authority granted under the
Plan be exercised, so as to disqualify either the Plan or any ISO under
Section 422, unless the Participant has first requested the change that
will result in such disqualification.
(v) Director Options.
4.6-5
<PAGE> 6
(A) Annual Grants. Notwithstanding any other
provision in the Plan to the contrary, each Non-Employee Director shall
be automatically granted, without action on the part of the Company,
the Board, the Committee or any other person, a Director Option to
purchase 10,000 Shares on the date of each annual meeting of
stockholders of the Company beginning with the 1998 Annual Meeting of
Stockholders; provided, however, that Director Options shall not be
granted to a Non-Employee Director in a given year if, during the
6-month period prior to and including the date the Director Option
would otherwise be granted pursuant to this Section 6(b)(v), such
Non-Employee Director was granted a Director Option pursuant to clause
(B) below.
(B) Grant Upon Initial Election. A Director
Option to purchase 20,000 Shares shall be automatically granted to each
individual who is first elected or appointed to serve as a member of
the Board after the Effective Date and who, as of the time of such
election or appointment, is a Non-Employee Director.
(C) Terms. All Director Options shall be NQSOs
which shall be granted for no consideration other than services. The
exercise price per Share purchasable under a Director Option shall be
equal to the Fair Market Value of the Shares on the date of grant of
the Director Option. Each Director Option shall be exercised by giving
written notice of exercise to the Company accompanied by payment in
full of the Exercise price in cash (including by check) or by surrender
of Shares acquired by the Director at least six months prior to the
Exercise Date, which Shares have a Fair Market Value at the time of
delivery equal to the Exercise price, or a combination of a cash
payment and such a surrender of Shares.
(D) Exercisability. A Director Option shall be
exercisable and fully vested immediately upon grant and shall continue
to be exercisable until the earlier of (1) 10 years after the date of
grant, (2) a number of years after the Non-Employee Director ceases to
serve as a member of the Board equal to the number of years (including
any partial years) the Non-Employee Director served as a member of the
Board, if a Non-Employee Director ceases to serve as a member of the
Board for any reason other than dismissal for cause, and (3) at the
time the Non-Employee Director ceases to serve as a member of the
Board, if he is dismissed for cause; provided, however, that, if a
Non-Employee Director ceases serving as a member of the Board and,
immediately thereafter, he is employed by the Company or a Subsidiary,
then, solely for purposes of this Section 6(b)(v), he shall not be
deemed to have ceased to serve as a member of the Board at any time,
and his continued employment by the Company or any Subsidiary shall be
deemed to be continued service as a member of the Board for purposes of
the Plan (except that such former Board member shall not be eligible
for additional grants and Director Options under the Plan); and
provided, further, that a Director Option shall be exercisable after
the date a Non-Employee Director ceases to serve as a member of the
Board (unless the Non-Employee Director continues to be employed by the
Company or a Subsidiary under the preceding proviso) only to the extent
such Director Option was exercisable at such date.
(E) Non-Exclusivity. The automatic grant of
Director Options under this Section 6(b)(v) shall not be exclusive and,
in addition thereto, additional Options or other Awards may be granted
to such Non-Employee Director in the discretion of the Board or the
Committee of such kinds, in such amounts and at such times as the Board
or the Committee shall decide in its sole discretion.
(c) Stock Appreciation Rights. The Board is authorized to
grant Stock Appreciation Rights to Eligible Persons on the following terms and
conditions:
(i) Right to Payment. A Stock Appreciation Right
shall confer on the Participant to whom it is granted a right to
receive, upon exercise thereof, the excess of (A) the Fair Market Value
of a Share on the date of exercise (or, in the case of a Limited SAR,
the Fair Market Value determined by reference to the Change in Control
Price), or, if the Board shall so determine in the case of any such
right other than one related to any Incentive Stock Option, at any time
during a specified period before or after the date of exercise, over
(B) the grant price of the Stock Appreciation Right as determined by
the Board as of the date of grant of the Stock Appreciation Right,
which, except as provided in Section 7(a) hereof, shall not be less
than the Fair Market Value of a Share on the date of grant.
(ii) Other Terms. The term, methods of exercise,
methods of settlement and any other terms and conditions of any Stock
Appreciation Right shall be determined by the Board. Limited SARs that
may
4.6-6
<PAGE> 7
only be exercised in connection with a Change in Control or other event
as specified by the Board may be granted on such terms, not
inconsistent with this Section 6(c), as the Board may determine. SARs
and Limited SARs may be awarded either on a free-standing basis or in
tandem with other Awards.
(d) Restricted Stock. The Board is authorized to grant
Restricted Stock to Eligible Persons on the following terms and conditions:
(i) Grant and Restrictions. Restricted Stock shall be
subject to such restrictions on transferability, risk of forfeiture and
other restrictions as the Board may impose (including, without
limitation, limitations on the right to vote Restricted Stock or the
right to receive dividends thereon), which restrictions may lapse
separately or in combination at such times, under such circumstances
(including based on the achievement of performance goals and/or future
service requirements), in such installments, or otherwise, as the Board
shall determine at the time of grant or thereafter. Except to the
extent restricted under the terms of the Plan and any Award Agreement
relating to the Restricted Stock, a Participant granted Restricted
Stock shall have all of the rights of a stockholder, including the
right to vote the Restricted Stock and the right to receive dividends
thereon (subject to any mandatory reinvestment or other requirement
imposed by the Board). During the restricted period applicable to the
Restricted Stock, subject to Section 11 hereof, the Restricted Stock
may not be sold, transferred, pledged, hypothecated, margined or
otherwise encumbered by the Participant.
(ii) Forfeiture. Except as otherwise determined by
the Committee at the time of grant or thereafter, upon termination of
employment or service on the Board (as determined under criteria
established by the Board) during the applicable restriction period,
Restricted Stock that is at that time subject to restrictions shall be
forfeited and reacquired by the Company; provided, however, that
restrictions on Restricted Stock shall be waived in whole or in part in
the event of terminations resulting from specified causes, and the
Committee may in other cases waive in whole or in part restrictions on
or the forfeiture of Restricted Stock.
(iii) Certificates for Shares. Restricted Stock
granted under the Plan may be evidenced in such manner as the Board
shall determine, including, without limitation, issuance of
certificates representing Shares. Certificates representing Shares of
Restricted Stock shall be registered in the name of the Participant and
shall bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such Restricted Stock, and the Board may
require that the Company retain physical possession of the
Certificates, and that the Participant deliver a stock power to the
Company, endorsed in blank, relating to the Restricted Stock.
(iv) Dividends and Splits. As a condition to the
grant of an Award of Restricted Stock, the Board may require that any
cash dividends paid on a share of Restricted Stock be automatically
reinvested in additional shares of Restricted Stock or applied to the
purchase of additional Awards under the Plan. Unless otherwise
determined by the Board, Shares distributed in connection with a stock
split or stock dividend, and other property distributed as a dividend,
shall be subject to restrictions and a risk of forfeiture to the same
extent as the Restricted Stock with respect to which such Shares or
other property has been distributed.
(e) Deferred Stock. The Board is authorized to grant Deferred
Stock to Eligible Persons on the following terms and conditions:
(i) Issuance and Limitations. Delivery of Shares
shall occur upon expiration of the deferral period specified for the
Award of Deferred Stock by the Board. In addition, an Award of Deferred
Stock shall be subject to such limitations (including a risk of
forfeiture) as the Committee may impose (if any), which limitations may
lapse at the expiration of the deferral period or at other specified
times (including based on achievement of performance goals and/or
future service requirements, separately or in combination, in
installments or otherwise, as the Committee shall determine at the time
of grant or thereafter. A Participant awarded Deferred Stock shall have
no voting rights and shall have no rights to receive dividends in
respect of Deferred Stock, unless and only to the extent that the
Committee shall award Dividend Equivalents in respect of such Deferred
Stock.
(ii) Forfeiture. Except as otherwise determined by
the Board upon termination of employment with or service to the Company
(as determined under criteria established by the Board) during the
applicable deferral period or portion thereof to which forfeiture
conditions apply, Deferred Stock that is at that time subject to
deferral (other than a deferral at the election of the Participant)
shall be forfeited; provided,
4.6-7
<PAGE> 8
however, that the Board may provide, by rule or regulation or in any
Award Agreement or may determine in any individual case, that
restriction or forfeiture conditions relating to Deferred Stock shall
be waived in whole or in part in the event of terminations resulting
from specified causes, and the Board may in other cases waive in whole
or in part the forfeiture of Deferred Stock.
(f) Bonus Shares and Awards in Lieu of Obligations. The Board
is authorized to grant Shares or other Awards as a bonus to Eligible Persons or
in lieu of obligations to pay cash or deliver other property under the Plan or
under other plans or compensatory arrangements (including salary requirements),
provided that, in the case of Participants subject to Section 16 of the Exchange
Act, the amount of such grants remains within the discretion of the Board to the
extent necessary to ensure that acquisitions of Shares or other Awards are
exempt from liability under Section 16(b) of the Exchange Act. Shares or Awards
granted hereunder shall be subject to such other terms as shall be determined by
the Board.
(g) Dividend Equivalents. The Board is authorized to grant
Dividend Equivalents to a Participant. Dividend Equivalents shall confer upon
the Participant rights to receive, currently or on a deferred basis, cash,
Shares, other Awards or other property equal in value to dividends paid with
respect to a specified number of Shares, or otherwise, as determined by the
Board. The Board may provide that Dividend Equivalents shall be paid or
distributed when accrued or shall be deemed to have been reinvested in
additional Shares or Awards or other investment vehicles, and subject to such
restrictions or transferability and risk of forfeiture, as the Board may
specify. Dividend Equivalents may be awarded on a free-standing basis or with
another Award.
(h) Other Stock-Based Awards. The Board is authorized, subject
to limitations under applicable law, to grant to Participants such other Awards
that are denominated or payable in, valued in whole or in part by reference to,
or otherwise based on, or related to, Shares, as deemed by the Board to be
consistent with the purposes of the Plan, including, without limitation,
purchase rights for Shares, Shares awarded which are not subject to any
restrictions or conditions, convertible or exchangeable debt securities or other
rights convertible or exchangeable into Shares, Awards with value and payment
contingent upon performance of the Company or any other factors designated by
the Board, and Awards valued by reference to the book value of Shares or the
value of securities of or the performance of specified Subsidiaries as the Board
determines. The Board shall determine the terms and conditions of such awards.
Except as provided in Section 7(a) hereof, Shares or securities delivered
pursuant to an Award in the nature of a purchase right granted under this
Section 6(h) shall be purchased for such consideration, paid for at such times,
by such methods and in such forms, including, without limitation, cash, Shares,
other outstanding Awards or other property or any combination thereof, as the
Committee shall determine. Cash awards, as an element of or supplement to any
other Award under the Plan, may also be granted pursuant to this Section 6(h).
(i) Exchange Provisions. The Board may at any time offer to
exchange or buy out any previously granted Award for a payment in cash, Shares,
another Award or other property, based on such terms and conditions as the Board
shall determine and communicate to the Participant at the time that such offer
is made.
SECTION 7. GENERAL TERMS OF AWARDS.
(a) Stand-Alone, Additional, Tandem and Substitute Awards.
Awards granted under the Plan may, in the discretion of the Board, be granted
either alone or in addition to, in tandem with or in substitution or exchange
for, any other Award granted under the Plan or any award granted under any other
plan of the Company or any Subsidiary (subject to the terms of Section 10
hereof), or any other right of a Participant to receive payment from the Company
or any Subsidiary. Such additional, tandem, substitute or exchange Awards may be
granted at any time. If an Award is granted in substitution or exchange for
another Award or award, the Board shall require the surrender of such other
Award or award in consideration for the grant of the new Award. The exercise
price of any Option, the grant price of any Stock Appreciation Right or the
purchase price of any other Award conferring a right to purchase Share
retroactively granted in tandem with an outstanding Award or award shall be
either not less than the Fair Market Value of Shares at the date of grant of the
later Award or equal to the Fair Market Value of Shares at the date of grant of
the earlier Award or award. Notwithstanding the foregoing, the exercise price of
any Option, grant price of any Stock Appreciation Right or purchase price of any
other Award conferring a right to purchase Shares which is granted in exchange
or substitution for an option, stock appreciation right or other award granted
by the Company (other than in connection with a transaction described in Section
9(a) hereof) shall not be less than the exercise price, grant price or purchase
price of the exchanged or substituted Option, Stock Appreciation Right or other
Award, and outstanding Awards shall not be amended (other than in
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<PAGE> 9
connection with a transaction described in Section 4(b) hereof to reduce the
exercise price, grant price or purchase price of any such Award.
(b) Decisions Required to be Made by the Board. Other
provisions of the Plan and any Award Agreement notwithstanding, if any decision
regarding an Award or the exercise of any right by a Participant, at any time
such Participant is subject to Section 16 of the Exchange Act or is a Covered
Employee under Section 162(m) of the Code, is required to be made or approved by
the Board in order that a grant to or transaction by such Participant will be
exempt under Rule 16b-3 or qualify as "qualified performance-based compensation"
for purposes of Section 162(m) of the Code then the Board shall retain full and
exclusive power and authority to make such decision or to approve or disapprove
any such decision by the Participant.
(c) Term of Awards. The term of each Award shall be for such
period as may be determined by the Board; provided, however, that in no event
shall the term of any Incentive Stock Option, or a Stock Appreciation Right
granted in tandem therewith, exceed a period of ten years from the date of its
grant.
(d) Form and Timing of Payment of Awards. Subject to the terms
of the Plan and any applicable Award Agreement, payments or substitutions to be
made by the Company or a Subsidiary upon the grant, exercise or settlement of an
Award may be made in such forms as the Board shall determine at the time of
grant or thereafter (subject to the terms of Section 10 hereof), including,
without limitation, cash, Shares, other Awards or other property or any
combination thereof, and may be made in a single payment or substitution, in
installments or on a deferred basis, in each case in accordance with rules and
procedures established by the Board. Such rules and procedures may include,
without limitation, provisions for the payment or crediting of reasonable
interest on installment or deferred payments or the grant or crediting of
Dividend Equivalents in respect of installment or deferred payments. The
settlement of any Award may be accelerated, and cash paid in lieu of Shares in
connection with such settlement, in the discretion of the Board or upon
occurrence of one or more specified events (in addition to a Change in Control).
(e) Exemptions from Section 16(b) Liability. It is the intent
of the Company that the grant of any Awards to or other transaction by a
Participant who is subject to Section 16 of the Exchange Act shall be exempt
under Rule 16b-3 (except for transactions acknowledged in writing to be
non-exempt by such Participant). Accordingly, if any provision of the Plan or
any Award Agreement does not comply with the requirements of Rule 16b-3 as then
applicable to any such transaction, such provision shall be construed or deemed
amended to the extent necessary to conform to the applicable requirements of
Rule 16b-3 so that such Participant shall avoid liability under Section 16(b).
(f) Share Certificates. All certificates for Shares delivered
under the terms of the Plan shall be subject to such stop-transfer orders and
other restrictions as the Committee may deem advisable under federal or state
securities laws, rules and regulations thereunder, and the rules of any national
securities exchange, the Nasdaq Stock Market or any other automated quotation
system on which Shares are listed or quoted. The Board may cause a legend or
legends to be placed on any such certificates to make appropriate reference to
such restrictions or any other restrictions or limitations that may be
applicable to Shares. In addition, during any period in which Awards or Shares
are subject to restrictions or limitations under the terms of the Plan or any
Award Agreement, or during any period during which delivery or receipt of an
Award or Shares has been deferred by the Board or a Participant, the Board may
require any Participant to enter into an agreement providing that certificates
representing Shares issuable or issued pursuant to an Award shall remain in the
physical custody of the Company or such other Person as the Committee may
designate.
SECTION 8. PERFORMANCE AWARDS.
(a) Performance Conditions. The right of a Participant to
exercise or receive a grant or settlement of any Award, and the timing thereof,
may be subject to such performance conditions as may be specified by the Board.
The Board may use such business criteria and other measures of performance as it
may deem appropriate in establishing any performance conditions, and may
exercise its discretion to reduce or increase the amounts payable under any
Award subject to performance conditions, except as limited under Section 8(b)
hereof in the case of a Performance Award intended to qualify under Section
162(m) of the Code.
(b) Performance Awards Granted to Designated Covered
Employees. If the Board determines that a Performance Award to be granted to an
Eligible Person who is designated by the Board as likely to be a Covered
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<PAGE> 10
Employee should qualify as "performance-based compensation" for purposes of
Section 162(m) of the Code, the Board shall comply with the pre-established
performance goals and other terms set forth in this Section 8(b).
(i) Performance Goals Generally. The performance
goals for such Performance Awards shall consist of one or more business criteria
and a targeted level or levels of performance with respect to each of such
criteria, as specified by the Board consistent with this Section 8(b).
Performance goals shall be objective and shall otherwise meet the requirements
of Section 162(m) of the Code, including the requirement that the level or
levels of performance targeted by the Board result in the achievement of
performance goals being "substantially uncertain." The Board may determine that
such achievement of performance be granted, exercised and/or settled upon
achievement of any one performance goal or that two or more of the performance
goals must be achieved as a condition to grant, exercise and/or settlement of
such Performance Awards. Performance goals may differ for Performance Awards
granted to anyone Participant or to different Participants.
(ii) Business Criteria. One or more of the following
business criteria for the Company, on a consolidated basis, and/or for specified
Subsidiaries or business units of the Company (except with respect to the total
stockholder return and earnings per share criteria), shall be used by the Board
in establishing performance goals for such Performance Awards: (1) earnings per
share; (2) revenues; (3) cash flow; (4) return on investment; (5) return on net
assets, assets, capital or equity; (6) economic value added; (7) operating
margin; (8) net income; (9) pretax earnings; (10) pretax earnings before
interest, depreciation and amortization; (11) pretax operating earnings after
interest expense and before extraordinary or special items; (12) operating
earnings; (13) total stockholder return; (14) price of the shares (and changes
thereof); and (15) any of the above goals as compared to the performance of a
published or special index deemed applicable by the Board including, but not
limited to, the Standard & Poor's 500 Stock Index or a group of comparable
companies.
(iii) Performance Period; Timing for Establishing
Performance Goals. Achievement of performance goals in respect of such
Performance Awards shall be measured over a performance period of up to 10
years, a specified by the Board. Performance goals shall be established not
later than 90 days after the beginning of any performance period applicable to
such Performance Awards or at such other date as may be required or permitted
for "performance-based compensation" under Section 162(m) of the Code.
(iv) Performance Award Pool. The Board may establish
a Performance Award pool, which shall be an unfunded pool for purposes of
measuring performance of the Company in connection with Performance Awards. The
amount of such Performance Award pool shall be based upon the achievement of a
performance goal or goals based on one or more of the business criteria set
forth in Section 8(b)(ii) hereof during the given performance period, as
specified by the Board in accordance with Section 8(b)(iii) hereof. The Board
may specify the amount of the Performance Award pool as a percentage of any such
business criteria, a percentage thereof in excess of a threshold amount, or as
another amount which need not bear a strictly mathematical relationship to such
business criteria.
(v) Settlement of Performance Awards; Other Terms.
Settlement of such Performance Awards shall be in cash, Stock, other Awards or
other property, in the discretion of the Board. The Board may, in its
discretion, reduce the amount of a settlement otherwise to be made in connection
with such Performance Awards, but may not exercise discretion to increase any
such amount payable to a Covered Employee in respect of a Performance Award
subject to this Section 8(b). The Board shall specify the circumstances in which
such Performance Awards shall be paid or forfeited in the event of termination
of employment by the Participant prior to the end of a performance period or
settlement of Performance Awards.
(c) Written Determinations. All determinations by the Board as
to the establishment of performance goals, the amount of any Performance Award
pool or potential individual Performance Awards and as to the achievement of
performance goals relating to Performance Awards under Section 8(b) hereof shall
be made in writing in the case of any Award intended to qualify under Section
162(m) of the Code. The Board may not delegate any responsibility relating to
such Performance Awards.
(d) Status of Section 8(b) Awards under Section 162(m) of the
Code. It is the intent of the Company that Performance Awards under Section 8(b)
granted to persons who are designated by the Committee as likely to be Covered
Employees within the meaning of Section 162(m) of the Code and the regulations
thereunder shall, if so designated by the Board, constitute "performance-based
compensation" within the meaning of Section 162(m) of the Code of the Code and
the regulations thereunder. The foregoing notwithstanding, because the Board
cannot determine with
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<PAGE> 11
certainty whether a given participant will be a Covered Employee with respect to
a fiscal year that has not yet been completed, the term Covered Employee as used
herein shall mean only a person designated by the Committee, at the time of
grant of Performance Awards or an Annual Incentive Award, as likely to be a
Covered Employee with respect to that fiscal year. If any provision of the Plan
as in effect on the date of adoption or any agreements relating to performance
Awards or Annual Incentive Awards that are designated as intended to comply with
Section 162(m) of the Code does not comply or is inconsistent with the
requirements of Section 162(m) of the Code, such provision shall be construed or
deemed amended to the extent necessary to conform to such requirements.
SECTION 9. CHANGE IN CONTROL.
(a) Acceleration of Exercisability and Lapse of Restrictions
and Cash-Out of Awards upon "Change in Control". In the event of a Change in
Control, subject only to the applicable restrictions set forth in Section 11(a)
hereof, the following provisions shall apply unless otherwise provided in the
Award Agreement, and:
(i) All outstanding Awards, pursuant to which the
Participant may have a right to exercise which was not previously exercisable
and vested, shall become fully exercisable and vested as of the time of the
Change in Control and shall remain exercisable and vested for the balance of the
stated term of such Award without regard to any termination of employment or
services by the Participant.
(ii) Unless the right to lapse of restrictions or
limitations is waived or deferred by a Participant prior to such lapse, all
restrictions (including risks of forfeiture and deferrals) on outstanding Awards
subject to restrictions or limitations under the Plan shall lapse and such
Awards shall be deemed fully vested as of the time of the Change in Control.
(iii) All performance criteria, goals and other
conditions to payment of Awards under which payments of cash, Shares or other
property are subject to conditions shall be deemed to be achieved or fulfilled
as of the time of the Change in Control.
(iv) For a period of 60 days following a Change in
Control, each Participant may elect to surrender any outstanding Award and to
receive, in full satisfaction therefor, a cash payment equal to the value of
such Award calculated on the basis of the Change in Control Price of any Shares
or the Fair Market Value of any property other than Shares relating to such
Award; provided, however, that in the case of an Incentive Stock Option, or a
Stock Appreciation Right granted in tandem therewith, the payment shall be based
upon the Fair Market Value of Shares on the date which the Change in Control
occurred; provided further, however, that in the case of a Change in Control
described in Section 9(b)(i)(C) or (D) hereof, the payment described in this
sentence shall not necessarily be made in cash but instead shall be made in the
same form (i.e., cash, Shares, other securities or combination thereof) as
holders of Shares receive in exchange for their Shares in the transaction that
results in the Change in Control. In the event that an Award is granted in
tandem with another Award such that the Participant's right to payment for such
Award is an alternative to payment of another Award, the Participant electing to
surrender any such tandem Award shall surrender all alternative Awards related
thereto and receive payment for the Award which produces the highest payment to
the Participant.
(b) Definition of Certain Terms. For purposes of this Section
9, the following definitions, in addition to those set forth in Section 2, shall
apply:
(i) "Change in Control" means and shall be deemed to
have occurred if:
(A) any Person, other than the Company or a
Related Party, is or becomes the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act, except that a Person shall be deemed to be the
beneficial owner of all Shares that such Person has the right to acquire
pursuant to any agreement or arrangement or upon exercise, conversation rights,
warrants, options or otherwise, without regard to the 60 day period referred to
in Rule 13d-3 under the Exchange Act), directly or indirectly, of Voting
Securities representing 25% or more of the total voting power of all the then
outstanding Voting Securities, except that there shall be excluded from the
number of Voting Securities deemed to be beneficially owned by a Person a number
of Voting Securities representing not more than 10 percent of the then
outstanding voting power if such Person is (1) eligible to file a Schedule 13G
pursuant to Rule 13-1(b)(1) under the Exchange Act with respect to Voting
Securities or (2) an underwriter who becomes the beneficial owner of more than
20% of the then outstanding Voting Securities pursuant to a firm commitment
underwriting agreement with the Company; or
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<PAGE> 12
(B) the individuals who, as of the effective
date of the Plan, constitute the members of the Board together with those
directors who are first elected subsequent to such date and whose election by
the Board or nomination for election by the Company's stockholders was approved
by a vote of at least a majority of the members of the Board then still in
office who were either directors as of the effective date of the Plan or whose
election or nomination for election was previously so approved (the "Continuing
Directors"), cease for any reason to constitute at least a majority of the
members of the Board; or
(C) the consummation of a merger,
consolidation, recapitalization or reorganization of the Company, reverse spilt
of any class of Voting Securities, or in an acquisition of securities or assets
by the Company, other than (1) any such transaction which would result in at
least 75% of the total voting power represented by the voting securities of the
surviving entity outstanding immediately after such transaction being
beneficially owned by at least 75% of the holders of outstanding Voting
Securities immediately prior to the transaction, with the voting power of each
such continuing holder relative to other such continuing holders not
substantially altered in the transaction, or (2) any such transaction which
would result in a Related Party beneficially owning more than 50% of the voting
securities of the surviving entity outstanding immediately after such
transaction; or
(D) the stockholders of the Company approve a
plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets
other than (1) any such transaction which would result in a Related Party owning
or acquiring more than 50 percent of the assets owned by the Company immediately
prior to the transaction, or (2) a sale or disposition immediately after which
such assets will be owned directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of the common
stock of the Company immediately prior to such sale or disposition.
(E) any other event occurs which the Board
determines, in its discretion, would materially alter the structure of the
Company or its ownership.
(ii) "Change in Control Price" means, with respect to
a Share, the higher of (A) the highest Fair Market Value of the Shares at any
time during the 60 calendar days preceding and the 60 days following the Change
in Control; or (B) the highest price paid per Share in a transaction which
either (1) results in a Change in Control or (2) would be consummated but for
another transaction which results in a Change in Control and, if it were
consummated, would result in a Change in Control. With respect to clause (B) in
the preceding sentence, the "price paid" will be equal to the sum of (1) the
face amount of any portion of the consideration consisting of cash or cash
equivalents and (2) the Fair Market Value of any portion of the consideration
consisting or real or personal property other than cash or cash equivalents, as
established by an independent appraiser selected by the Board.
(iii) "Related Party" means (A) a Subsidiary of the
Company; or (B) an employee or group of employees of the Company or any
majority-owned Subsidiary of the Company; or (C) a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
majority-owned Subsidiary of the Company; or (D) an entity owned directly or
indirectly by the stockholders of the Company in substantially the same
proportion as their ownership of Voting Securities.
(iv) "Voting Securities or Security" means any
securities of the Company which carry the right to vote generally in the
election of directors.
SECTION 10. AMENDMENTS TO AND TERMINATION OF THE PLAN AND AWARDS. The
Board may amend, alter, suspend, discontinue or terminate the Plan or the
Committee's authority to grant Awards under the Plan without the consent of
stockholders or Participants, except that any amendment, alteration, suspension,
discontinuation or termination shall be subject to approval of the Company's
stockholders not later than the annual meeting next following such Board action
if stockholder approval is required by any federal or state law or regulation or
the rules of the Nasdaq Stock Market or on any national securities exchange,
stock market or automated quotation system on which the Shares are then listed,
traded or quoted, or if the Board in its discretion determines that obtaining
such stockholder approval is for any reason advisable; provided, however, that,
without the consent of the Participant, no amendment, alteration, suspension,
discontinuation or
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<PAGE> 13
termination of any Award may materially and adversely affect the rights of such
Participant under any Award theretofore granted to him.
SECTION 11. GENERAL PROVISIONS.
(a) Compliance with Legal and Other Requirements. The Company
may, to the extent deemed necessary or advisable by the Board, postpone the
issuance or delivery of Shares or payment of other benefits under any Award
until completion of such registration or qualification of such Shares or other
required action under any federal or state law, rule or regulation, listing or
other required action with respect to the Nasdaq Stock Market or any national
securities exchange, automated quotation system or any other stock exchange or
stock market upon which the Shares or other securities of the Company are listed
or quoted, or compliance with any other obligation of the Company, as the Board
may consider appropriate, and may require any Participant to make such
representations, furnish such information and comply with or be subject to such
other conditions as it may consider appropriate in connection with the issuance
or delivery of Shares or payment of other benefits in compliance with applicable
laws, rules, and regulations, listing requirements, or other obligations. The
foregoing notwithstanding, in connection with a Change in Control, the Company
shall take or cause to be taken no action, and shall undertake or permit to
arise no legal or contractual obligation, that results or would result in any
postponement of the issuance or delivery of Stock or payment of benefits under
any Award or the imposition of any other conditions on such issuance, delivery
or payment, to the extent that such postponement of other condition would
represent a greater burden on a Participant than existed on the 90th day
preceding the Change in Control.
(b) Transferability. No Award granted under the Plan, nor any
other rights acquired by a Participant under the Plan, shall be assignable or
transferable by a Participant, other than by a will or the laws of descent and
distribution, or pursuant to a qualified domestic relations order as defined
under the Code or Title I of the Board of Retirement Income Security Act of
1974, and each such Award or right shall be exercisable during the Participant's
lifetime only by the Participant or, if admissible under applicable law, by the
Participant's guardian or legal representative or a transferee receiving such
Award pursuant to a QDRO; provided, however, that the Board may, in its sole
discretion, authorize all or a portion of an Award to be transferable by the
Participant, but only to (i) any immediate family members of the Participant,
(ii) any trust or trusts for the exclusive benefit of such immediate family
members, or (iii) a partnership or limited liability company in which such
immediate family members are the only partners or members, provided that (A)
there may be no consideration for any such transfer, other than an interest in a
transferee's partnership, limited liability company or other similar entity, (B)
the Award Agreement related to the Award must expressly provide for such
transferability in a manner consistent with this section 11(b), (C) the Board,
in granting an Award, may impose additional restrictions on transfer or prohibit
such transfer entirely, (D) following any transfer, any such Award shall
continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, provided that for purposes of the Plan, any
reference to a Participant shall be deemed to refer to the transferee, (E) in
the event of a transferee's death, an Award may be exercised by the personal
representative of the transferee's estate or, if no personal representative has
been appointed, by the successor or successors in interest determined under the
transferee's will or under the applicable laws of descent and distribution.
Following any such transfer, any transferee shall continue to be subject to the
same terms and conditions as were applicable immediately prior to transfer,
provided for purposes of Section 11(b) hereof, the term "Participant" shall be
deemed to refer to the transferee, and any event of termination of employment of
the Participant as set forth in the Award Agreement or in this Plan shall
continue to be applied with respect to the original Participant, following which
the Award shall be exercisable by the transferee only to the extent, and for the
period specified by, the Award Agreements.
(c) No Rights to Awards; No Stockholder Rights. Nothing in the
Plan shall be construed as giving any Participant, Eligible Person or other
Person any right to claim to be granted any Award under the Plan, or to be
treated uniformly with other Participants and Eligible Persons. No Award shall
confer on any Participant any of the rights of a stockholder of the Company
unless and until Shares are in fact issued to such Participant in connection
with the terms of such Award. Notwithstanding the foregoing, in connection with
each grant of Restricted Stock hereunder, the applicable Award shall specify if
and to what extent the Participant shall not be entitled to the rights of a
stockholder in respect of such Restricted Stock.
(d) Withholding. The Company or any Subsidiary is authorized
to withhold from any Award granted or any payment due under the Plan, including
from a distribution of Shares, amounts of withholding and other taxes due with
respect to an Award, its exercise or any payment thereunder, and to take such
other action as the Committee may deem necessary or advisable to enable the
Company and Participants to satisfy obligations for the
4.6-13
<PAGE> 14
payment of withholding taxes and other tax obligations relating to any Awards.
This authority shall include authority to withhold or receive Shares, Awards or
other property and to make cash payments in respect thereof in satisfaction of
such tax obligations.
(e) No Right to Employment. Nothing contained in the Plan or
any Award Agreement shall confer, and no grant of an Award shall be construed
as, (i) conferring, upon any Participant or any Eligible Person, any right to
continue in the employ or service of the Company or any Subsidiary or (ii)
interfering in any way with the right of the Company or any Subsidiary to (A)
terminate any Participant's or Eligible Person's employment or service at any
time or (B) increase or decrease the compensation of any Participant or Eligible
Person from the rate in existence at the time of granting of an Award, except as
may be expressly provided in any Award Agreement or other compensation
arrangement.
(f) Unfunded Status of Awards; Creation of Trusts. The Plan is
intended to constitute an "unfunded" plan for incentive and deferred
compensation. With respect to any payments not yet made to Participant pursuant
to an Award, nothing contained in the Plan or any Award shall give any such
Participant any rights that are greater than those of a general unsecured
creditor of the Company; provided, however, that the Board may authorize the
creation of trusts or make other arrangements to meet the Company's obligations
under the Plan to deliver cash, Shares or other property pursuant to any Award,
which trusts or other arrangements shall be consistent with the "unfunded"
status of the Plan unless the Board otherwise determines.
(g) No Limit on Other Compensatory Arrangements Nothing
contained in the Plan shall prevent the Company or any Subsidiary from adopting
or continuing in effect other or additional compensation arrangements (which may
include, without limitation, employment agreements with executives and
arrangements which relate to Awards under the Plan), and such arrangements may
be either generally applicable only in specific cases.
(h) No Fractional Shares. No fractional Shares shall be issued
or delivered pursuant to the Plan or any Award. The Board shall determine
whether cash, other Awards or other property shall be issued or paid in lieu of
fractional Shares or whether such fractional Shares or any rights thereto shall
be forfeited or otherwise eliminated.
(i) Governing Law. The validity, interpretation, construction
and effect of the Plan, any rules and regulations relating to the Plan and any
Award Agreement shall be governed by the laws of the State of Delaware (without
regard to provisions governing conflicts of laws) and applicable federal law.
(j) Severability.
(i) If any provision of the Plan or any Award is or
becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction
or as to any Person or Award, or would disqualify the Plan or any Award under
any law deemed amended to conform to applicable laws or, if it cannot be
construed or deemed amended without, in the determination of the Board,
materially altering the intent of the Plan, it shall be deleted and the
remainder of the Plan shall remain in full force and effect; provided, however,
that, unless otherwise determined by the Board, the provision shall not be
construed or deemed amended or deleted with respect to any Participant whose
rights and obligations under the Plan are not subject to the law of such
jurisdiction or the law deemed applicable by the Board.
(ii) If any of the terms or provisions of the Plan
conflict with the requirements of applicable law or applicable rules and
regulations thereunder, including the requirements of Section 162(m) of the
Code, Rule 16b-3 and/or Section 422A of the Code, then such terms or provisions
shall be deemed inoperative to the extent necessary to avoid the conflict with
applicable law, or applicable rules and regulations, without invalidating the
remaining provisions hereof. With respect to ISOs, if the Plan does not contain
any provision required to be included herein under Section 422A of the Code,
such provisions shall be deemed to be incorporated herein with the same force
and effect as if such provision had been set out at length herein; provided,
further, that to the extent any Option which is intended to qualify as an ISO
cannot so qualify, such Option, to that extent, shall be deemed to be a
Nonqualified Stock Option for all purposes of the Plan.
(k) Rule 16b-3 Compliance. With respect to persons subject to
Section 16 of the Exchange Act, transactions under the Plan are intended to
comply with all applicable terms and conditions of Rule 16b-3 and any successor
provisions. To the extent that any provision of the Plan or action by the Board
fails to so comply, it shall be deemed null and void, to the extent permitted by
law and deemed advisable by the Board.
4.6-14
<PAGE> 15
(l) Headings. Headings are given to the sections and
subsections of the Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of the Plan or any provision thereof.
(m) Award Agreements. Each Award hereunder shall be evidenced
by an Award Agreement which shall be delivered to the Participant and shall
specify the terms and conditions of the Award and any rules applicable thereto.
Such terms may include, but are not limited to, the effect on such Award of the
death, retirement or other termination of employment of a Participant and the
effect, if any, of a change in control of the Company.
(n) Indemnification. Each person who is or shall have been a
member of the Committee, if any, or of the Board shall be indemnified and held
harmless by the Company against and from any loss, cost, liability or expense
that may be imposed upon or reasonably incurred by him in connection with or
resulting from any claim, action, suit or proceeding to which he may be made a
party or in which he may be involved by reason of any action taken or failure to
act under the Plan and against and from any and all amounts paid by him in
settlement thereof, with the Company's approval, or paid by him in satisfaction
of any judgment in any such action, suit or proceeding against him, provided he
shall give the Company an opportunity, at its own expense, to handle and defend
the same before he undertakes to handle and defend it on his own behalf. The
foregoing right of indemnification shall not be exclusive and shall be
independent of any other rights of indemnification to which such persons may be
entitled under the Company's Certificate of Incorporation or By-laws, by
contract, as a matter of law, or otherwise.
(o) Construction. For purposes of the Plan, the following
rules of construction shall apply: (i) the word "or" is disjunctive but not
necessarily exclusive; (ii) words in the singular include the plural; words in
the plural include the singular; and words in the neuter gender include the
masculine and feminine genders; and (iii) words in the masculine or feminine
gender include the other and neuter genders.
SECTION 12. EFFECTIVE DATE AND TERMINATION.
(a) The Plan shall become effective as of June 12, 1998, the
date the Plan was adopted and approved by the stockholders of the Company. Any
Awards granted under the Plan prior to such approval of stockholders shall be
effective when made (unless otherwise specified by the Board at the time of
grant) but shall be conditioned upon and subject to such approval of the Plan by
stockholders.
(b) No awards may be granted under the Plan after June 12,
2008. Unless otherwise expressly provided in the Plan or in an applicable Award
Agreement, any Award granted hereunder may, and the authority of the Board to
amend, alter, adjust, suspend, discontinue or terminate any such Award or to
waive any conditions or rights under any such Award shall, continue after June
12, 2008.
4.6-15
<PAGE> 1
EXHIBIT 5.1
KEGLER, BROWN, HILL & RITTER CO., L.P.A.
65 E. STATE STREET, SUITE 1800, CAPITOL SQUARE
COLUMBUS, OHIO 43215-4294
(614) 462-5400
June 12, 1998
Marcum Natural Gas Services, Inc.
1675 Broadway, Suite 2150
Denver, Colorado 80202
Re: Registration Statement on Form S-8 covering the
Marcum Natural Gas Services, Inc. 1998 Stock Incentive Plan
Gentlemen:
We have acted as counsel to Marcum Natural Gas Services, Inc., a
Delaware corporation (the "Company"), in connection with the preparation and
filing of the captioned Registration Statement on Form S-8 (the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
relating to the registration of 1,000,000 shares of Common Stock, par value $.01
per share (the "Plan Shares"), of the Company issuable pursuant to the Marcum
Natural Gas Services, Inc. 1998 Stock Incentive Plan (the "Plan").
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Company's
Restated Certificate of Incorporation, as amended, (ii) the Company's Bylaws, as
amended, (iii) the Registration Statement, (iv) the Plan, (v) a specimen
certificate evidencing the Plan Shares, (vi) resolutions adopted by the Board of
Directors of the Company relating to, among other things, the Plan and the Plan
Shares, and (vii) such other documents and certificates as we have deemed
necessary or appropriate for the purpose of rendering the opinion below. We have
also examined such authorities of law as we have deemed relevant as a basis for
this opinion.
In our examination of the documents referred to above, we have assumed
the legal capacity of all natural persons, the genuineness of all signatures,
the authenticity and completeness of all documents submitted to us as certified,
conformed, photostatic or facsimile copies, and the authenticity and
completeness of the originals of such latter documents. As to any facts material
to the opinion expressed herein which we did not independently establish or
verify, we have relied upon written or oral certificates, statements,
representations and other documentation furnished to us by officers, employees
and representatives of the Company, public officials and others without
independent verification of the facts set forth therein.
Based upon and subject to the foregoing and the further qualifications
and limitations set forth below, we are of the opinion that the Plan Shares have
been duly authorized for issuance and, when issued and sold by the Company
against receipt of payment in full therefor and otherwise in accordance with the
terms and conditions of the Plan, will be legally and validly issued, fully paid
and nonassessable.
In rendering the opinion above, we have assumed that (i) the
certificates representing the Plan Shares will conform to the specimen thereof
examined by us, (ii) upon issuance of the Plan Shares pursuant to the Plan, the
Company will have a sufficient number of authorized but unissued shares of
Common Stock not restricted for other purposes to permit the issuance of the
Plan Shares, and (iii) no changes occur in the applicable law or pertinent
facts, and (iv) the Company will comply with all applicable state securities
laws.
We are admitted to practice law in the State of Ohio. This opinion is
limited to the Federal laws of the United States of America and the General
Corporation Law of the State of Delaware in effect as of the date hereof. This
opinion is furnished by us solely for the benefit of the Company in connection
with the issuance of the Plan Shares and the filing of the Registration
Statement and any amendments thereto. This opinion may not be furnished to or
relied upon by any other person or entity for any purpose or assigned, quoted or
otherwise used without our prior written consent. Please note that we are
opining only as to the matters expressly set forth herein, and no opinion should
be inferred as to any other
5.1-1
<PAGE> 2
matters. We express no opinion herein with respect to the meaning,
interpretation, validity, binding nature or enforceability of the Plan or any
contract, agreement, instrument or other document entered into pursuant to the
Plan.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement and the use of
our name wherever appearing in the Registration Statement. In giving such
consent, however, we do not hereby admit that we are within the category of
persons whose consent is required under Section 7 of the Securities Act or the
rules and regulations of the Securities and Exchange Commission promulgated
thereunder.
Very truly yours,
/s/ Kegler, Brown, Hill & Ritter Co., L.P.A.
KEGLER, BROWN, HILL & RITTER CO., L.P.A.
5.1-2
<PAGE> 1
EXHIBIT 23.2
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this
Registration Statement on Form S-8 of Marcum Natural Gas Services, Inc. of our
report dated March 12, 1998 (March 23, 1998 as to Note 8), appearing in the
Annual Report on Form 10-KSB of Marcum Natural Gas Services, Inc. for the year
ended December 31, 1997.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Denver, Colorado
June 12, 1998
23.2-1
