As filed with the Securities and Exchange Commission on March 10, 1997
Registration No. 333-__________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
EXPRESS AMERICA HOLDINGS CORPORATION
(Exact name of registrant as specified in its charter)
Arizona 86-0670679
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Two Renaissance Square
40 North Central Avenue
Suite 1200
Phoenix, Arizona 85004-4424
(Address of principal executive offices)
(Zip Code)
Express America Holdings Corporation 1996 Performance Share Plan,
as Amended on February 26, 1997
(Full title of the plan)
James M. Hennessy, Senior Vice President
Express America Holdings Corporation
Suite 1200
Phoenix, Arizona 85004-4424
(Name and address of agent for service)
(602) 417-8115
(Telephone number, including area code, of agent for service)
Copies to:
Joseph P. Richardson, Esq.
Brown & Bain, P.A.
2901 North Central Avenue
Suite 2000
Phoenix, Arizona 85012
(602) 351-8000
<TABLE>
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====================================================================================================================
CALCULATION OF REGISTRATION FEE
====================================================================================================================
Proposed Proposed
Amount Maximum Maximum Amount
Title of Securities to be Offering Price Aggregate of
to Be Registered Registered Per Share* Offering Price Registration Fee
=================================== =================== ================== ==================== ====================
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 250,000 $9.31 $2,327,500 $802.60
=================================== =================== ================== ==================== ====================
</TABLE>
* Estimated solely for the purpose of calculating the amount of the Registration
fee, pursuant to Rules 457(c) and 457(h) of the Securities Act of 1933, on the
basis of the average of the high and low prices for shares of common stock on
March 5, 1997.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This Registration Statement relates to 250,000 shares of Common Stock,
$.01 par value, of Express America Holding Corporation (the "Registrant"), being
registered for use under the Registrant's 1996 Performance Share Plan (the
"Plan"). Under the Plan, an employee may be granted an award in the form of a
Performance Share. Each Performance Share represents the right and option (which
is a non-statutory stock option) to purchase one share of Common Stock of the
Registrant. The Performance Shares awarded shall vest at a rate of 20% on each
anniversary of the date of the grant of the award.
Item 3. Incorporation of Documents by Reference
The following documents previously filed by the Registrant with the
Securities and Exchange Commission (the "Commission") are incorporated herein by
reference. The following documents are hereby incorporated by reference into
this Registration Statement of Express America Holdings Corporation (the
"Registrant") and in the related Section 10(a) prospectus: (a) the Registrant's
annual report of Form 10-K for the fiscal year ended September 30, 1996; (b) all
reports filed with the Securities and Exchange Commission pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 since September 30, 1996;
and (c) the description of the Registrant's capital stock contained in the
Registrant's Registration Statement on Form 8-A (file no. 000-19799) filed with
the Securities and Exchange Commission pursuant to Section 12(g) of the
Securities Exchange Act of 1934.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, 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 herein by reference and to be part hereof from the
date of filing of such documents.
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
None.
Item 6. Indemnification of Directors and Officers
Subsection (a) of Section 145 of the General Corporation Law of the State
of Delaware empowers a corporation 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 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, 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 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 reasonable cause to believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation 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 such
person acted in any of the capacities set forth above, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with 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 interests of the corporation, except that no indemnification may 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.
Section 145 further provides, among other things, that to the extent a
director or officer of a corporation has been successful on the merits or
otherwise in the defense of any action, suit or proceeding referred to in
subsections (a) and (b) of Section 145, 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; that such
expenses may be paid in advance by the corporation upon receipt of an
undertaking to repay such amount if it is ultimately determined that such
indemnification is not authorized under Section 145; that indemnification
provided for by Section 145 shall not be deemed
<PAGE>
exclusive of any other rights to which the indemnified party may be entitled;
that indemnification provided for by Section 145 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 such
person's heirs, executors and administrators; and empowers the corporation to
purchase and maintain insurance on behalf of a director or officer of the
corporation 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 liabilities under
Section 145.
Section 102(b)(7) of the General Corporation Law of the State of Delaware
provides that a certificate of incorporation may contain a provision eliminating
or limiting the personal liability of a director to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director
provided that such provision shall not eliminate or limit the liability of a
director (i) for any breach of the director's duty of loyalty to the corporation
or its stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the Delaware General Corporation I-aw, or (iv) for any
transaction from which the director derived an improper personal benefit.
Article 8 of the Registrant's Amended and Restated Certificate of
Incorporation states that:
"A. The Corporation shall, to the fullest extent permitted by the
Delaware General Corporation Law, as the same exists or may hereinafter be
amended, indemnify any and all persons who it shall have power to indemnify
under such law from and against any and all of the expenses, liabilities or
other matters referred to in or covered by such law. Such indemnification may be
provided pursuant to any Bylaw, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his director or officer capacity
and as to action in another capacity while holding such office, and shall
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.
B. If a claim under paragraph A. of this Article is not paid in
full by the Corporation within thirty (30) days after a written claim has been
received by the Corporation, the claimant may at any time thereafter bring suit
against the Corporation to recover the unpaid amount of the claim and, if
successful in whole or in part, the claimant shall also be entitled to be paid
the expense of prosecuting such claim. It shall be a defense to any such action
(other than an action brought to enforce a claim for expenses incurred in
defending any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Corporation) that the
claimant has not met the standards of conduct which make it permissible under
the laws of the State of Delaware for the Corporation to indemnify the claimant
for the amount claimed, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he has met the applicable
standard of conduct set forth in the laws of the State of Delaware nor an actual
determination by the Corporation (including its Board of Directors, independent
legal counsel, or its stockholders) that the Claimant has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct."
Article 9 of Registrant's Amended and Restated Certificate of
Incorporation states that:
"To the fullest extent permitted by the Delaware General
Corporation Law as the same exists or may hereafter be amended, a director of
the Corporation shall not be liable to the Corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director."
The Registrant maintains an irrevocable indemnity trust funded from
current revenue of the Registrant to secure the indemnity obligations of the
Registrant to its directors and officers, regardless of whether such obligation
arises under its charter, Bylaws, the Delaware General Corporation Law or any
indemnification agreements. The Registrant is obligated to make monthly deposits
of $8,333 into the indemnity trust, but such obligation is suspended during any
period when the corpus of the trust equals $3,000,000. In the event of a "change
in control" of the Registrant, it is required to deposit an amount equal to
$3,000,000 less the balance of the trust corpus into the trust. For these
purposes, a "change in control" will be deemed to have occurred if during two
consecutive years individuals who at the beginning of such period constitute the
Board of Directors of the Registrant cease for any reason to constitute a
majority thereof unless each new director was elected by, or on the
recommendation of, a majority of the directors then still in office who were
directors at the beginning of such period.
The Registrant has entered into an indemnity agreement with each member
of the Board of Directors and certain of its officers (the "Agreements"), and is
authorized to enter such agreements with future members of the Board and future
officers, employees and agents. The Agreements provide the persons party thereto
with specific contractual assurances that they will be indemnified to the
fullest extent permitted by law and with certain procedural protections in the
event that they are sued in their capacities as directors, officers, employees
or agents, including provisions for advancement of expenses incurred in
connection with an indemnifiable event.
<PAGE>
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits
4.1 Express America Corporation 1996 Performance Share Plan.
4.2 Form of Performance Share Agreement for 1996 Performance Share Plan
(incorporated by reference to Exhibit A of Exhibit 4.2 hereof).
5 Opinion of Brown & Bain, P.A.
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Brown & Bain, P.A. (included in Exhibit 5 hereof).
24 Power of Attorney (included on page 5 hereto)
Item 9. Undertakings
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new Registration Statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be
deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be in the initial bona fide offering
thereof.
In the event that a claim for indemnification against such
liabilities (other than payment by the Registrant of expenses incurred or paid
by a director, officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question of whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, State of Arizona, on March 6, 1997.
Express America Holdings Corporation
By: /s/ Robert W. Stallings
------------------------------------
Robert W. Stallings
Chairman of the Board
Chief Executive Officer and President
Pursuant to the requirements of the Securities Act of 1993, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
POWER OF ATTORNEY
KNOW ALL MEN BE THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert W. Stallings and James R. Reis,
and each of them, his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments to this Form
S-8 Registration Statement, and to file the same, with all exhibits thereto, and
other documents in connection therewith with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person hereby ratifying and
confirming all that said attorneys-in-fact and agents, or his or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date(s) indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Robert W. Stallings Chairman of the Board March 6, 1997
- ----------------------------- Chief Executive Officer and
Robert W. Stallings President (Principal
Executive Officer)
/s/ James R. Reis Vice Chairman and Chief March 6, 1997
- ----------------------------- Financial Officer (Principal
James R. Reis Accounting Officer)
Director March , 1997
- -----------------------------
John C. Cotton
/s/ Roy A. Herberger, Jr. Director March 6, 1997
- -----------------------------
Roy A. Herberger, Jr.
/s/ John Holliman, III Director March 6, 1997
- -----------------------------
John M. Holliman, III
/s/ Stephen A McConnell Director March 6, 1997
- -----------------------------
Stephen A McConnell
Director March , 1997
- -----------------------------
Paul J. Renze
</TABLE>
<PAGE>
INDEX TO EXHIBITS
Sequentially
------------
Numbered
--------
Exhibit No. Exhibit Page
- ----------- ------- ----
4.1 Express America Holdings Corporation 1996
Performance Share Plan.
4.2 Form of Performance Share Agreement for 1996
Performance Share Plan.
5 Opinion of Brown & Bain, P.A.
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Brown & Bain, P.A. (included in
Exhibit 5 hereof).
24 Power of Attorney (included on page 5 hereto).
EXPRESS AMERICA HOLDINGS CORPORATION
1996 PERFORMANCE SHARE PLAN
(as amended on February 11, 1997)
1. Background and Purpose.
----------------------
The purposes of this Plan are to attract and retain the best possible
personnel for positions of responsibility within the Company and its
Subsidiaries, to provide additional incentives to Employees, and to promote the
success of the Company's business through the grant of performance shares which
further the identity of interests of Employees with the long-term financial
success of the Company.
In connection with its recruitment of employees for its fund management
business, the Company undertook to review the desirability and feasibility of
establishing certain incentive compensation plans, including a performance share
plan. Accordingly, as is more fully set forth hereinafter, the Plan contemplates
awards to Employees in certain instances as though the date of grant of the
award occurred on April 7, 1995, the date that the Company commenced its fund
management business.
The Plan was approved on August 30, 1996 (the "Effective Date"), by the
Company's Board of Directors, including the Compensation of the Board (which on
the date of approval was comprised solely of Directors who were "non-employee
directors" within the meaning of the definition of that term set forth in the
rules and regulations adopted by the Securities and Exchange Commission pursuant
to Section 16(b) of the Exchange Act. On February 11, 1997, the Board determined
that it was in the best interest of the Company, its stockholders, and Plan
participants to amend the Plan to provide that awards under the Plan will be
paid by the Company solely in shares of Common Stock and not in cash, and to
limit participation in the Plan to persons who are not Executive Officers of the
Company.
2. Definitions.
-----------
As used herein, the following words shall have the following meanings:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Cause" shall mean (a) the failure by the Participant to
substantially perform the Participant's duties with the Company or a
Subsidiary (other than any such failure resulting from the
Participant's incapacity due to physical or mental illness), (b) the
willful engaging by the Participant in conduct which is materially
injurious to the Company or any Subsidiary, monetarily or otherwise, or
(c) termination by the Participant (as opposed to termination by the
Company or a Subsidiary) of his employment by the Company or the
<PAGE>
Subsidiaries for any reason other than death or disability, including,
without limitation, any voluntary termination of employment.
(c) Change of Control" is defined in Section 7.1 hereof.
(d) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
(e) "Committee" shall mean the Compensation Committee of the
Board or, if the Board shall so decide, the Board.
(f) "Common Stock" shall mean the common stock of the Company
described in the Company's Certificate of Incorporation, as amended and
in effect from time to time.
(g) "Company" shall mean Express America Holdings Corporation,
a Delaware corporation.
(h) "Compensation Amount" shall mean an amount equal to (i)
the number of Performance Shares as to which an exercise of Performance
Shares relate, multiplied by (ii) the excess, if any, of the Share
Value of such Performance Shares on the date of exercise over the Share
Value of such Performance Shares on the date of the award thereof.
(i) "Effective Date" is defined in Section 1.
(j) "Employee" shall mean any person, including officers and
directors, employed by the Company or any Subsidiary of the Company,
but shall not include Executive Officers of the Company. The payment of
a director's fee shall not be sufficient to constitute "employment" for
purposes of the Plan.
(k) "Executive Officer" shall have the same meaning as is set
forth for the term "officer" in Rule 16a-l(f) promulgated under the
Exchange Act, as the same may be amended, and any successor to Rule
16a-l(f).
(l) "Exchange Act" shall mean the Securities and Exchange Act
of 1934, as amended.
(m) "Expiration Date" is defined in Section 7.1 hereof.
(n) "Participant" shall mean an Employee who has been awarded
a grant of Performance Shares.
2
<PAGE>
(o) "Performance Share" shall mean an interest awarded under
the Plan that entitles its holder to receive the Compensation Amount
related thereto, in accordance with the terms of the Plan.
(p) Performance Share Agreement" shall mean the written
agreement between the Company and the Participant relating to the award
of one or more Performance Shares. A Performance Share Agreement may be
in the form of Exhibit A attached to the Plan.
(q) "Plan" shall mean this 1996 Performance Share Plan, as
amended and in effect from time to time.
(r) "Share Value" shall mean, as of any date of determination,
(a) while the Common Stock is listed on a national stock exchange or
quoted on a national quotation system, the closing price per share (or
if no closing price is provided, the average of the high "bid" and low
"ask" prices) of the Common Stock on such exchange or quotation system
on the date of grant or exercise, as the case may be, of an award of
Performance Shares, or (b) if the Common Stock is not so listed or
quoted, the per share value of the Common Stock determined by the
Committee or the Board, as the case may be, in its sole discretion, as
the case may be. Notwithstanding the foregoing, the Share Value with
respect to the initial awards of Performance Shares shall be $5.75
(which amount exceeded the closing price per share on the date of grant
of such Performance Shares).
(s) "Subsidiary" shall mean any corporation or other entity a
majority of whose outstanding stock entitled to vote (or other
ownership interest) is owned, directly or indirectly, by the Company.
3. Performance Shares Subject To The Plan.
--------------------------------------
Awards under this Plan shall be granted to a Participant in the form of
Performance Shares, which shall be credited to a Performance Share account
maintained by the Company for such Participant. Each Performance Share shall be
deemed to be equivalent to one share of Common Stock for purposes of the Plan,
or, with respect to Performance Shares awarded to Participants who are not
Executive Officers of the Company, shall be the right and option to purchase one
share of Common Stock. The right or option to purchase shares under this Plan is
not intended to qualify as "incentive stock options" under Section 422 of the
Code or any successor provision. The award of Performance Shares under the Plan
shall not entitle the recipient to any dividend or voting rights or any other
rights of a stockholder with respect to such Performance Shares, nor shall any
such award be deemed to impose upon the Board or the Committee, or upon any
member thereof, any fiduciary duty to any Participant.
Subject to the provisions of Section 9 of the Plan, the maximum
aggregate number of Performance Shares that may be awarded and the number of
shares of Common Stock which may
3
<PAGE>
be issued upon exercise of Performance Shares under the Plan is 250,000. If any
Performance Shares awarded under the Plan shall be forfeited or cancelled, such
Performance Shares may again be awarded under the Plan.
4. Administration Of The Plan.
--------------------------
4.1 Procedure. The Plan shall be administered by the Compensation
Committee of the Board or, in the absence of a Compensation Committee, by the
Board. As used in this herein, the term "Committee" shall mean the Committee or
the Board, whichever is then administering the Plan.
4.2 Powers Of The Committee. Subject to the provisions of the Plan, the
Committee shall have the authority, in its discretion to: (i) award grants of
Performance Shares to Employees and to determine the terms thereof; (ii)
determine, upon review of relevant information, the Share Value of Performance
Shares; (iii) determine the Employees to whom, and the time or times at which,
Performance Shares shall be granted; (iv) interpret the Plan; (v) prescribe,
amend and rescind rules and regulations relating to the Plan; (vi) determine the
terms and provisions of each award of Performance Shares granted (which need not
be identical) and, with the consent of the grantee thereof, modify or amend such
terms and provisions; (vii) accelerate or (with the consent of the grantee)
defer the payment date of any Performance Share; (viii) authorize any person to
execute on behalf of the Company Performance Share Agreements and any instrument
required to effectuate the award of a grant of Performance Shares previously
granted under the Plan; and (ix) make all other determinations necessary or
advisable in the judgment of the Committee for the administration of the Plan.
4.3 Effect Of Committee's Decision. All decisions, determinations and
interpretations of the Committee shall be final and binding on all Participants.
5. Eligibility.
-----------
Consistent with the Plan's purposes, awards of Performance Shares may
be granted only to Employees as determined by the Committee. An Employee who has
been granted Performance Shares may be granted awards of additional Performance
Shares.
4
<PAGE>
6. Effective Date.
--------------
The Plan shall be effective on the Effective Date and shall terminate
on the tenth anniversary of the Effective Date, unless earlier terminated by the
Board; provided, however, that the Plan and all outstanding Performance Shares
shall remain in effect until such Performance Shares have expired or are
canceled. Notwithstanding the foregoing, the Committee may, in its discretion,
fix as the effective date of an award of Performance Shares a date which
precedes the Effective Date, so long as such date is not earlier than April 7,
1995 (and any such date so fixed shall be deemed to be the date of grant of such
Performance Shares for the purposes of vesting under Section 7 hereof and
termination under Section 8 hereof.
7. Performance Shares.
------------------
7.1 Term Of Performance Shares and Vesting. The Committee in its sole
discretion shall determine the number of Performance Shares to be awarded to an
Employee and the Share Value of such Performance Shares on the grant date.
Unless determined otherwise by the Committee, one-fifth (20%) of the Performance
Shares awarded shall vest on each anniversary of the date of grant of the award
(or the deemed date of grant determined in accordance with Section 6) . The term
of a Performance Share shall expire on the date (the "Expiration Date")
established by the Committee, or, if no such date is established, on the tenth
(10th) annual anniversary of the date of grant.
All outstanding Performance Shares shall vest upon a Change of
Control. "Change of Control" shall be deemed to have occurred if (a) any
"person" (as such term is used in Sections 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934 (the "Exchange Act") other than the Company or a Subsidiary
or any employee benefit plan sponsored by the Company or any Subsidiary or any
mutual fund for which the Company or any Subsidiary performs any services shall
become the beneficial owner (within the meaning of Rule 13d-3 under the Exchange
Act or any successor rule) directly or indirectly, of securities of the Company
representing in excess of 35% of the combined voting power of the Company's then
outstanding securities, or (b) during any period of two consecutive years,
individuals who at the beginning of the such period constitute the Board of
Directors of the Company cease for any reason to constitute a majority thereof
unless each new director was elected by, or on the recommendation of, a majority
of the directors then still in office who were directors at the beginning of the
period.
5
<PAGE>
7.2 Exercise of and Payment for Performance Shares.
----------------------------------------------
(a) Exercise. The exercise of Performance Shares shall entitle
the Participant (or the Participant's estate) to receive the
Compensation Amount, determined as of the date written notice of such
exercise is received by the Company. Subject to Section 8 hereof, a
Participant may exercise his vested Performance Shares, in whole or in
part, by written notice to the Company at any time and from time to
time before the Expiration Date applicable to such Performance Shares.
A Performance Share shall be deemed exercised on the date that the
Company receives written notice, addressed to the attention of its
Corporate Secretary, stating to the effect that the Participant
exercises his Performance Shares.
In no event shall a Performance Share be exercisable after its
Expiration Date.
(b) Payment. Except as provided below in this Section 7.2(b),
the Compensation Amount payable with respect to Performance Shares as
of the exercise date therefor shall be paid to the Participant (or the
Participant's estate) in shares of Common Stock (on the basis of one
share of Common Stock for each Performance Share) and the Participant
shall pay to the Company upon exercise an amount (the "Exercise Price")
equal to the number of Performance Shares exercised multiplied by the
Share Value of such Performance Shares on their date of grant (or by
$5.75 with respect to the initial Performance Shares referred to in the
definition of the term "Share Value" in Section 2).
Notwithstanding any other provision set forth in this Plan and
notwithstanding the grant of Performance Shares, the Company shall have
no obligation to deliver, and no Participant who on the date of
exercise is an "officer" of the Company within the meaning of that term
as it is defined in Rule 16a-1(f) under the Exchange Act shall have the
right to exercise, any Performance Share and the grant of Performance
Shares to such an "officer" shall be deemed rescinded immediately
before such person is elected an "officer".
The Exercise Price and any taxes attributable to the delivery
of Common Stock under the Plan shall be paid: (i) in United States
dollars in cash or by check, bank draft or money order payable to the
order of the Company; or (ii) at the discretion of the Company, through
the delivery of shares of Common Stock with an aggregate Share Value on
the exercise date equal to the Exercise Price and withholding taxes, if
any; or (iii) at the election of the Participant and with the consent
of the Company, by the Company's retention of such number of shares of
Common Stock subject to the exercised Performance Shares which have an
aggregate Share Value on the exercise date equal to the Company's
aggregate federal, state, local and foreign tax withholding and FICA
and FUTA obligations with respect to income generated by the exercise
of the Performance Shares exercised by the Participant; or (iv) by a
combination of (i), (ii) and (iii) above.
6
<PAGE>
Shares of Common Stock delivered by the Company need only be
delivered pursuant to an effective registration statement covering such
shares in the event that such shares may not otherwise be delivered
lawfully.
A Participant's exercise of a Performance Share shall result
in a decrease in the number of Performance Shares in the Participant's
Performance Share account.
8. Effect of Termination Of Status As An Employee.
----------------------------------------------
Unless otherwise determined by the Committee, if a Participant's
employment by the Company or a Subsidiary is terminated (such that the
Participant is thereupon not employed by the Company or any Subsidiary), the
Participant may exercise vested Performance Shares within the following periods
after termination:
(a) Termination Of Status As An Employee. Except as otherwise
provided in subsection (b) or (c) below, if a Participant's employment
by the Company or a Subsidiary is terminated by the Company or such
Subsidiary, except if such termination occurs due to Cause, then the
Participant may exercise his vested Performance Shares at any time
within thirty (30) days after the date he ceases to be an Employee, but
only to the extent that he was entitled to exercise it on the date of
such termination. If such termination of employment is due to Cause,
all of the Participant's Performance Shares, vested and unvested, shall
terminate simultaneously with termination of employment, unless
otherwise expressly determined by the Board or the Committee.
(b) Disability. If a Participant is unable to continue his
employment with the Company as a result of his permanent and total
disability (as defined in Section 22(e)(3) of the Code), he may
exercise his vested Performance Shares at any time within twelve (12)
months from the date of termination.
(c) Death. If a Participant dies during the term of the
Performance Shares and is at the time of his death an Employee who
shall have been in continuous status as an Employee since the date of
grant of award of Performance Shares, the vested Performance Shares
standing to the account of such Participant may be exercised at any
time within twelve (12) months following the date of death by the
decedent estate or by a person who acquired the right to exercise the
Performance Shares by bequest or inheritance, but only to the extent
that decedent was entitled to exercise the Performance Shares on the
date of death.
9. Adjustments Upon Changes In Capitalization Or Merger.
----------------------------------------------------
In the event of any change in the number of outstanding shares of
Common Stock of the Company by reason of any stock dividend, stock split,
spinoff, recapitalization, merger,
7
<PAGE>
consolidation, combination, exchange of shares or otherwise, the terms and the
number of any outstanding Performance Shares shall be equitably adjusted by the
Board in its sole discretion to preserve the benefit of the award Performance
Shares for the Company and the Participants.
10. Non-Transferability Of Performance Shares.
-----------------------------------------
No Performance Share, nor any right, title or interest therein, may be
sold, pledged, assigned, hypothecated, transferred or otherwise disposed of in
any manner other than by will or by the laws of descent or distribution, or
pursuant to a "qualified domestic relations order" (a "QDRO") under the Code and
the Employee Retirement Income Security Act of 1974, as amended. A Performance
Share may be exercised, during the lifetime of the Participant, only by the
Participant or, if the Performance Share has been transferred pursuant to a
QDRO, by the person who receives the Performance Share pursuant to the QDRO.
11. Amendment And Termination Of The Plan.
-------------------------------------
The Board may at any time and in any way amend, suspend or terminate
the Plan; provided, however, that no such amendment, suspension or termination
shall impair the rights of any Participant (which for purposes of this Section
shall not include any transferee of any Participant) with respect to awards
previously granted under the Plan without the consent of the Participant so
affected.
Notwithstanding the foregoing, the Board may, without the consent of
any Participant, amend the Plan in such manner as the Board may from time to
time determine to be necessary, advisable or appropriate to permit the Company
to issue shares of its Common Stock in full or partial payment of the
Compensation Amount.
12. Miscellaneous Provisions.
------------------------
12.1 Plan Expense. Any expenses of administering this Plan shall be
borne by the Company.
12.2 Governing Law. The validity, construction, inter-pretation
administration and effect of the Plan and of its rules and regulations, and
rights relating to the Plan, shall be determined in accordance with the laws of
the State of Delaware without regard to conflict of law principles and, where
applicable, in accordance with the Code.
12.3 Taxes. The Company shall be entitled if necessary or advisable in
its determination to pay or withhold the amount of any withholding and other
taxes attributable to Compensation Amount from the amount of payments under the
Plan or from other amounts payable to a Participant.
8
<PAGE>
12.4 Indemnification. In addition to such other rights of
indemnification as they may have as members of the Board, the members of the
Board and of the Committee shall be indemnified by the Company against all costs
and expenses reasonably incurred by them in connection with any action, suit or
proceeding to which they or any of them may be party by reason of any action
taken or failure to act under or in connection with the Plan or any Performance
Shares, and against all amounts paid by them in settlement thereof (provided
such settlement is approved by independent legal counsel selected by the
Company) or paid by them in satisfaction of a judgment in any such action, suit
or proceeding, except a judgment based upon a finding of bad faith; provided
that upon the institution of any such action, suit or proceeding a Board member
or Committee member shall give the Company notice thereof and an opportunity, at
its own expense, to handle and defend the same before such Board member or
Committee member undertakes to handle and defend it on his own behalf.
12.5 No Employment Agreement. The Plan shall not confer upon any
Participant any right with respect to continuation of employment or other
relationship with the Company or any Subsidiary, nor shall it interfere in any
way with his right or the Company's or any Subsidiary right to terminate his
employment or other relationship at any time.
12.6 Gender. For purposes of this Plan, words used in the masculine
gender shall include the feminine and neuter, and the singular shall include the
plural and vice versa, as appropriate.
9
EXHIBIT A
to
PERFORMANCE SHARE PLAN
EXPRESS AMERICA HOLDINGS CORPORATION
PERFORMANCE SHARE AGREEMENT
---------------------------
BY THIS PERFORMANCE SHARE AGREEMENT ("Agreement") made and entered into
as of this ____ day of ____________, 19__, EXPRESS AMERICA HOLDINGS CORPORATION,
a Delaware corporation (the "Company"), and _________________________, (the
"Participant"), hereby state, confirm, represent, warrant and agree as follows:
I
RECITALS
--------
1.1 The Company has adopted the 1996 Performance Share Plan (as amended
from time to time, the "Plan"). The Plan is administered by the Compensation
Committee of the Board of Directors of the Company or by the Board (as
applicable, hereafter referred to as the "Committee").
1.2 By this Agreement, the Company and the Participant desire to
establish the terms upon which the Company will grant to the Participant, and
the Participant will accept from the Company, an award of Performance Shares
(such term, and other capitalized terms used without definition herein, having
the meaning attributed to such term in the Plan) under the Plan.
1.3 The "Grant Date" for all purposes of this Agreement is
______________, 199__. The Company and the Participant acknowledge and agree
that the Performance Shares evidenced by this Agreement shall vest in five equal
annual installments beginning on the first anniversary of the Grant Date.
II
AGREEMENTS
----------
2.1 Grant of Performance Shares. The Company grants to the Participant
______________ Performance Shares, said Performance Shares being subject to all
of the terms and conditions set forth in the Plan, which terms and conditions
are hereby incorporated herein by reference.
2.2 Exercise of Performance Shares. Exercise of the Performance Shares
shall entitle the Participant to receive shares of the Common Stock of the
Company on the basis of one share of
<PAGE>
stock for each Performance Share, subject to the vesting and other provisions of
this Agreement. Subject to Section 8 of the Plan, the Participant may exercise
his or her vested Performance Shares, in whole or in part, by delivering to the
Company written notice of exercise, specifying the number of vested Performance
Shares to which the exercise relates.
2.3 Vesting and Exercise of Performance Shares. Subject to the
provisions of Paragraph 2.4 of this Agreement, the Performance Shares shall vest
(and thereby first become exercisable) with respect to one-fifth (20%) of the
Performance Shares evidenced hereby Stock on each of the first five
anniversaries of the Grant Date.
2.4 Termination of Performance Shares. Except as otherwise provided
herein, the Performance Shares subject to this Agreement, to the extent not
theretofore duly exercised, shall terminate upon the first to occur of the
following dates:
(a) On the tenth (10th) anniversary of the Grant Date;
(b) Except as otherwise provided in clause (c) below,
expiration of thirty (30) days from the date the Participant's
employment with the Company or a Subsidiary terminates for any reason
other than Cause; if such termination is due to Cause, all unexercised
Performance Shares shall terminate immediately upon such termination of
employment; and
(c) Expiration of twelve (12) months from the date the
Participant's employment with the Company or a Subsidiary terminates
due to the Participant's death or disability (within the meaning of
Section 22(e)(3) of the Internal Revenue Code).
2.5 Notices. Any notice to be given under the terms of this Agreement
("Notice") shall be addressed to the Company in care of its secretary at its
then current corporate headquarters. Notice to be given to the Participant shall
be addressed to the Participant's address shown on the books and records of the
Company, or at such other address as the Participant shall designate by Notice.
Notice to the Company shall be deemed duly given when received
by the Company. Notice to the Participant shall be deemed duly given when
deposited by certified or registered mail, postage paid and return receipt
requested, in a post office or branch post office regularly maintained by the
United States Government.
2.6 Participant Not a Shareholder. The Participant shall not be deemed
for any purposes to be a shareholder of the Company with respect to any of the
Performance Shares, except to the extent that Performance Shares herein granted
shall have been exercised and with respect thereto the Company has elected to
pay the Compensation Amount in shares of Common Stock and a stock certificate
has been issued therefor.
2
<PAGE>
2.7 Disputes or Disagreements. As a condition of the granting of the
Performance Shares herein granted, the Participant agrees, for himself, his
heirs and his personal representatives, that any disputes or disagreements which
may arise under or as a result of or pursuant to this Agreement shall be
determined by the Committee in its sole discretion, and that any such
determination shall be final, binding and conclusive. In the event of any
conflict between this Agreement and the Plan, the Plan shall control.
2.8 Miscellaneous. This Agreement (together with the Plan) sets forth
the complete agreement between the parties with respect to the Performance
Shares granted hereby, and supersedes any and all prior agreements, both oral
and written. This Agreement shall be governed by and construed in accordance
with the laws of the State of Delaware and the terms set forth in the Plan,
which terms are incorporated herein by this reference.
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the Participant and by the Company through its duly authorized officer.
DATE: __________________, ____
EXPRESS AMERICA HOLDINGS CORPORATION
By___________________________________
Its_________________________________
"COMPANY"
_____________________________________
"OPTIONEE"
BROWN & BAIN
A PROFESSIONAL ASSOCIATION
2901 NORTH CENTRAL AVENUE
PHOENIX, ARIZONA 85012-2788
March 5, 1997
Express America Holdings Corporation
------------------------------------
Stock Option Plan
-----------------
Dear Ladies and Gentlemen:
We have acted as counsel to Express America Holdings Corporation, a
Delaware corporation (the "Company"), in connection with its Registration on
Form S-8 (the "Registration Statement") filed under the Securities Act of 1933
relating to the registration of 250,000 additional shares of its common stock,
$.01 par value (the "Shares"), issuable pursuant to the Company's 1996
Performance Share Plan, as amended (the "Plan").
In that connection, we have examined such documents, corporate records and
other instruments as we have deemed necessary or appropriate for purposes of
this opinion, including the Restated Certificate of Incorporation and Restated
Bylaws of the Company.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized and validly existing under
the laws of the State of Delaware.
2. The Shares, when issued and sold in accordance with the terms of the
Plan, will be validly issued, fully paid and nonassessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Brown & Bain, P.A.
Brown & Bain, P.A.
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
JPR:shj
EXHIBIT 5
PHOENIX TUCSON PALO ALTO
Independent Auditors' Consent
The Board of Directors
Express America Holdings Corporation:
We consent to the use of our report dated October 23, 1996 on the consolidated
financial statements of Express America Holdings Corporation as of September 30,
1996 and 1995 and for each of the years in the three-year period ended September
30, 1996, incorporated herein by reference.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Los Angeles, California
March 6, 1997
