<PAGE> 1
As filed with the Securities and Exchange Commission on December 22, 1998
Registration No. 333-__________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------------------------------
Stearns & Lehman, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Ohio 34-1579817
- ------------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
30 Paragon Parkway, Mansfield, Ohio 44903
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Stearns & Lehman, Inc.
Amended and Restated 1994 Stock Option Plan
-------------------------------------------
(Full title of the plan)
Copy to:
William C. Stearns, President Susan E. Brown, Esq.
Stearns & Lehman, Inc. Vorys, Sater, Seymour and Pease LLP
30 Paragon Parkway 52 East Gay Street
Mansfield, Ohio 44903 Columbus, Ohio 43216-1008
- --------------------------------------- -----------------------------------
(Name and address of agent for service)
(419) 522-2722
-------------------------------------------------------------
(Telephone number, including area code, of agent for service)
---------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------- -------------------- --------------------------------------- ----------------------- --------------------
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate offering Amount of
to be registered registered per unit (1) price (1) registration fee
- ---------------------- -------------------- --------------------------------------- ----------------------- --------------------
<S> <C> <C> <C> <C>
Common Shares, 275,000 $2.656 for 17,000 Common Shares; $867,656.00 $241.21
Without Par Value $3.188 for 258,000 Common Shares
- ---------------------- -------------------- --------------------------------------- ----------------------- --------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the aggregate offering
price and the registration fee pursuant to Rules 457(c) and 457(h)
promulgated under the Securities Act of 1933, as amended, and computed
on the basis of: (a) $2.656 for 17,000 Common Shares, which is the
price at which outstanding options to purchase such Common Shares may
be exercised, and (b) $3.188 per share for 258,000 of the Common Shares
to be registered, which is the average of the high and low sales prices
of the Common Shares as reported on The Nasdaq Stock Market on December
17, 1998.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
- -------------------------------------------------
The following documents previously filed with the Securities and
Exchange Commission (the "Commission") by Registrant pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), are specifically
incorporated by reference herein:
(a) Registrant's Annual Report on Form 10-KSB for the year ended
April 30, 1998;
(b) All other reports filed by Registrant with the Commission
pursuant to Section 13(a) or 15(d) of the Exchange Act since April 30, 1998; and
(c) The description of the Registrant's Common Shares contained in
the Registrant's Registration Statement on Form 8-A dated December 12, 1996,
which incorporates by reference the description of the Registrant's Common
Shares contained in the Registrant's Registration Statement on Form SB-1
(Registration No. 333-04244C) effective October 22, 1996, or contained in any
subsequent amendment or report filed for the purpose of updating such
description.
Any definitive Proxy Statement or Information Statement filed pursuant
to Section 14 of the Securities Exchange Act and all documents which may be
filed with the Commission pursuant to Sections 13, 14 or 15(d) of the Exchange
Act subsequent to the date hereof and prior to the completion of the offering
contemplated hereby, shall also be deemed to be incorporated herein by reference
and to be made a part hereof from the date of filing of such documents;
provided, however, that no report of the Compensation Committee of the Board of
Directors of the Registrant on executive compensation and no performance graph
included in any Proxy Statement or Information Statement filed pursuant to
Section 14 of the Exchange Act shall be deemed to be incorporated herein by
reference.
Item 4. Description of Securities.
- -----------------------------------
Not Applicable.
II-1
<PAGE> 3
Item 5. Interests of Named Experts and Counsel.
- ------------------------------------------------
The validity of the issuance of the Common Shares of the Registrant
being registered on this Registration Statement on Form S-8 will be passed upon
for the Registrant by Vorys, Sater, Seymour and Pease LLP, 52 East Gay Street,
P.O. Box 1008, Columbus, Ohio 43216-1008. Members of Vorys, Sater, Seymour and
Pease LLP and attorneys employed thereby, together with members of their
immediate families, beneficially own less than $50,000 of Common Shares of the
Registrant.
Item 6. Indemnification of Directors and Officers.
- ---------------------------------------------------
Ohio Revised Code Section 1701.13 authorizes indemnification of
directors, officers, employees and agents of the Company; allows the advancement
of costs of defending against litigation; and permits companies incorporated in
Ohio to purchase insurance on behalf of directors, officers, employees and
agents against liabilities whether or not under the circumstances such companies
could have the power to indemnify against such liabilities under the provisions
of the statute.
The Company's Code of Regulations provides for indemnification of its
officers, directors, employees and agents to the fullest extent permitted by the
laws of the State of Ohio. The Company's Code of Regulations will, to the
fullest extent permitted by Ohio law, provide indemnification against liability
of a director or officer to the Company or its shareholders for damages for
breach of such director's or officer's fiduciary duties to the Company, except
where a director or officer: (a) violates criminal law, unless such person had
reasonable cause to believe his conduct was lawful or had no reasonable cause to
believe his conduct was unlawful; (b) engages in a transaction from which such
person derived an improper benefit; or (c) authorizes an unlawful dividend.
While liability for monetary damages has been eliminated, equitable remedies
such as injunctive relief or rescission remain available.
Item 7. Exemption from Registration Claimed.
- ---------------------------------------------
Not Applicable.
Item 8. Exhibits.
- ------------------
See the Index to Exhibits attached hereto at page II-6.
II-2
<PAGE> 4
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 prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
provided, however, that paragraphs A(1)(i) and A(1)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
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
II-3
<PAGE> 5
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 that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions described in Item
6 of this Part II, or otherwise, the Registrant has been advised that
in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
II-4
<PAGE> 6
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 Columbus, State of Ohio, on the 22 day of December,
1998.
STEARNS & LEHMAN, INC.
By: /s/ William C. Stearns
---------------------------------------------
William C. Stearns
President, Treasurer and Director
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated and on the 22 day of December, 1998.
Signature Title
--------- -----
/s/ William C. Stearns President, Treasurer and Director
---------------------- (Principal Executive Officer)
William C. Stearns
/s/ John A. Chuprinko* Chief Financial Officer (Principal
- -------------------------- Financial and Accounting Officer)
John A. Chuprinko
/s/ Sally A. Stearns* Director, Vice President and Secretary
- -------------------------
Sally A. Stearns
/s/ Frank E. Duval* Director
- -------------------------
Frank E. Duval
/s/ Carter F. Randolph* Director
- -------------------------
Carter F. Randolph
* By Power of Attorney
/s/ William C. Stearns
- -------------------------
Attorney-in-Fact
II-5
<PAGE> 7
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
Exhibit No. Description Page No.
- ----------- ----------- --------
<S> <C> <C>
4(a) Amended Articles of Incorporation of Stearns & Incorporated herein by reference to
Lehman, Inc. Registrant's Registration Statement on
Form SB-1 filed on September 25, 1996
(Registration No. 333-4244-C)
4(b) Amended Code of Regulations of Stearns & Lehman, Incorporated herein by reference to
Inc. Registrant's Registration Statement on
Form SB-1 filed on September 25, 1996
(Registration No. 333-4244-C) [Exhibit 3.2]
4(c) Stearns & Lehman, Inc. Amended and Restated 1994 Pages 8-17.
Stock Option Plan
5 Opinion of Vorys, Sater, Seymour and Pease LLP, Pages 18 and 19.
counsel to Registrant
23(a) Consent of PricewaterhouseCoopers LLP Page 21.
23(b) Consent of Vorys, Sater, Seymour and Pease LLP, Filed as part of Exhibit 5 hereof.
counsel to Registrant
24 Powers of Attorney Pages 22-27.
</TABLE>
II-6
<PAGE> 1
Exhibit 4(c)
STEARNS & LEHMAN, INC.
----------------------
AMENDED AND RESTATED 1994 STOCK OPTION PLAN
-------------------------------------------
ARTICLE I
---------
OBJECTIVES
----------
1.1 The objectives of this 1994 Stock Option Plan (the "Plan") are to
enable Stearns & Lehman, Inc. (the "Company") to compete successfully in
retaining and attracting employees of outstanding ability, to stimulate the
efforts of employees toward the Company's objectives and to encourage ownership
of the Company's Common Shares by its employees.
ARTICLE II
----------
ADMINISTRATION
--------------
2.1 The Plan shall be administered by a committee (the "Committee")
designated by the Board of Directors of the Company. The Committee shall be
comprised of at least two persons, which shall be either the Compensation
Committee of the Board of Directors or such other committee comprised entirely
of "non-employee directors," within the meaning of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or any
successor rule or regulation, as the Board of Directors of the Company may from
time to time designate. Each member of the Committee shall at all times be
ineligible to receive Options under the Plan. All actions shall be taken by a
majority of the Committee.
2.2 Except as specifically limited by the provisions of the Plan and
applicable law, and in addition to any other express powers conferred on the
Committee by the Plan, the Committee in its sole discretion shall have the full
and final authority to:
A. Determine which Eligible Employees (as defined in Article
IV herein) shall be granted Options;
B. Determine the number of Shares which may be subject to each
Option;
C. Determine the term of each Option;
8
<PAGE> 2
D. Determine whether each Option is an Incentive Stock Option
or Non-qualified Stock Option;
E. Interpret the provisions of the Plan and decide all
questions of fact arising in its application; and
F. Prescribe such rules and procedures for Plan administration
as it may deem advisable from time to time.
2.3 Any action, decision, interpretation or determination by the
Committee with respect to the application or administration of this Plan shall
be final and binding upon all persons, and need not be uniform with respect to
its determination of recipients, amount, timing, form, terms or provisions of
Options.
2.4 No member of the Committee shall be liable for any action or
determination taken or made in good faith with respect to the Plan or any Option
granted hereunder, and to the extent permitted by law, all members shall be
indemnified by the Company for any liability and expenses which may occur
through any claim or cause of action.
ARTICLE III
-----------
SHARES SUBJECT TO PLAN
----------------------
3.1 The Shares that may be made subject to Options granted under the
Plan shall not exceed 275,000 Shares in the aggregate, subject to adjustment as
provided in Section 12.1 in the event of stock splits, stock dividends,
combinations or exchanges of shares or other similar capital adjustments. Upon
lapse or termination of any Option for any reason without being completely
exercised, the Shares which were subject to such Option may again be subject to
other Options. In addition, if any Option is exercised through the delivery of
Common Shares as provided in Section 8.1, the number of Shares available for
Options will be increased by the number of Common Shares so surrendered.
ARTICLE IV
----------
DEFINITIONS
-----------
4.1 For purposes of the Plan the following terms shall have the
definition which is attributed to them, unless another definition is clearly
indicated by a particular usage and context.
9
<PAGE> 3
A. "EFFECTIVE DATE OF EXERCISE" means the date on which the
Company has received written notice of exercise of an Option, in such
form as is acceptable to the Committee, and full payment of the
purchase price.
B. "EFFECTIVE DATE OF GRANT" means the date on which the
Committee makes an award of an Option.
C. "ELIGIBLE EMPLOYEE" means any individual (other than one
who receives retirement benefits, stipends, consulting fees,
honorariums, and the like, or who is a full time employee of any firm
other than the Company) who performs services for the Company or any
parent or subsidiary thereof, as the terms "parent" and "subsidiary"
are defined for purposes of Section 422 of the Code, and is included on
the regular payroll of the Company or any parent or subsidiary thereof.
D. "FAIR MARKET VALUE" means the last sale price reported on
any stock exchange or over-the-counter trading system on which Shares
are trading on a specified date or, if not so trading, the average of
the closing bid and asked prices for a Share on a specified date. If no
sale has been made on the specified date, then prices on the last
preceding day on which any such sale shall have been made shall be used
in determining fair market value under either method prescribed in the
previous sentence. If no market sales of any kind have taken place,
then the fair market value shall be the price at which Shares were last
issued by the Company.
E. "INCENTIVE STOCK OPTION" shall have the same meaning as
given to that term by Section 422 of the Code and any regulations or
rulings promulgated thereunder.
F. "NON-QUALIFIED STOCK OPTION" means any Option granted under
the Plan which is not considered an Incentive Stock Option.
G. "OPTION" means the right to purchase from the Company a
stated number of Shares at a specified price. The Option may be granted
to an Eligible Employee subject to the terms of this Plan and such
other conditions and restrictions as the Committee deems appropriate.
Each Option shall be designated by the Committee to be either an
Incentive Stock Option or a Non-qualified Stock Option.
H. "OPTION PRICE" means the purchase price per Share subject
to an Option and shall be fixed by the Committee, but shall not be less
than 100% of the Fair Market Value of a Share on the Effective Date of
Grant, except as otherwise provided in Section 9.2.
10
<PAGE> 4
I. "PERMANENT AND TOTAL DISABILITY" shall have the same
meaning as given to that term by Section 22(e)(3) of the Code and any
regulations or rulings, promulgated thereunder.
J. "SHARE" means one Common Share, no par value, of the
Company.
ARTICLE V
GRANTING OF OPTIONS
-------------------
5.1 Subject to the terms and conditions of the Plan, the Committee may,
from time to time prior to December 31, 2003, grant Options to Eligible
Employees on such terms and conditions as the Committee may determine. More than
one Option may be granted to the same Eligible Employee.
ARTICLE VI
----------
TERMS OF OPTIONS
----------------
6.1 Subject to specific provisions relating to Incentive Stock Options
set forth in Article IX, each Option shall be for a term of from five (5) to ten
(10) years and no longer from the Effective Date of Grant and may not be
exercised during the first twelve (12) months of the term of said Option.
Commencing on the first anniversary of the Effective Date of Grant of an Option,
the Option may be exercised for 25% of the total Shares covered by the Option
with an additional 25% of the total Shares covered by the Option becoming
exercisable on each succeeding anniversary until the Option is exercisable to
its full extent; provided, however, that the Committee may establish a different
schedule for any particular Option on the Effective Date of Grant. This right of
exercise shall be cumulative and shall be exercisable in whole or in part. The
Committee in its sole discretion may permit particular holders of Options to
exercise an Option to a greater extent than provided herein after expiration of
the first anniversary of the Effective Date of Grant of the Option.
6.2 Notwithstanding anything else contained herein to the contrary, in
the event that the Company or its shareholders enter into one or more agreements
to dispose of all or substantially all of the assets or fifty percent or more of
the outstanding capital stock of the Company by means of sale (whether as a
result of a tender offer or otherwise), merger, reorganization or liquidation in
one or a series of related transactions (each, an "Acceleration Event"), then
each Option outstanding under the Plan shall become exercisable during the
fifteen days immediately prior to the scheduled consummation of the Acceleration
Event with respect to the full number of Shares for which such Option has been
granted; provided, however, that no such Acceleration Event shall occur in the
event that (A) the primary purpose of
11
<PAGE> 5
the transaction is to change the Company's domicile solely within the United
States, (B) the terms of the agreement(s) require as a prerequisite for the
consummation of the transaction that each such Option shall either be assumed by
the successor corporation or parent thereof or be replaced with a comparable
option to purchase shares of capital stock of the successor corporation or
parent thereof or (C) the transaction is approved by a majority of the members
of the Board of Directors of the Company who had either been in office for more
than twelve (12) months prior to such transaction or had been elected, or
nominated for election by the Company's shareholders, by the vote of
three-fourths of the directors then still in office who were directors at the
beginning of such twelve-month period; and provided further that any such
exercise of an Option during such fifteen day period shall be conditioned upon
the consummation of such transaction and shall be effective only immediately
before such consummation, except to the extent that the holder may indicate, in
writing, that such exercise is unconditional with regard to all or part of the
unaccelerated portion of the option. Upon consummation of the Acceleration
Event, all outstanding Options, whether or not accelerated, shall terminate and
cease to be exercisable, unless assumed by the successor corporation or parent
thereof.
ARTICLE VII
-----------
EXERCISE OF OPTIONS
-------------------
7.1 Any person entitled to exercise an Option may do so in whole or in
part by delivering a written notice of exercise to the Company, to the attention
of its Secretary, at its principal office. The written notice shall specify the
number of Shares for which an Option is being exercised and shall be accompanied
by full payment of the Option Price for the Shares being purchased.
7.2 Except as otherwise provided in Article XI, no Option may be
exercised by an individual unless at all times beginning on the date of the
granting of the Option and ending on the day three (3) months before the date of
the exercise, the individual was an employee of the Company or of a parent or
subsidiary thereof.
ARTICLE VIII
------------
PAYMENT OF OPTION PRICE
8.1 In the sole discretion of the Committee, payment of the Option
Price may be made in cash, by the tender of Shares, or both. If payment by the
tender of Shares is permitted, the value of each Share shall be deemed to be the
Fair Market Value for a Share on the day the Shares are tendered for payment.
12
<PAGE> 6
ARTICLE IX
----------
INCENTIVE STOCK OPTIONS AND NON-QUALIFIED STOCK OPTIONS
-------------------------------------------------------
9.1 The Committee in its sole discretion may designate whether an
Option is to be considered an Incentive Stock Option or a Non-qualified Stock
Option. The Committee may grant both an Incentive Stock Option and a
Non-qualified Stock Option to the same individual. However, where both an
Incentive Stock Option and a Non-qualified Stock Option are awarded at one time,
such Options shall be deemed to have been awarded in separate grants, shall be
clearly identified, and in no event will the exercise of one such Option affect
the right to exercise the other such Option.
9.2 Any Option designated by the Committee as an Incentive Stock Option
will be subject to the general provisions applicable to all Options granted
under the Plan. In addition, the Incentive Stock Option shall be subject to the
following specific provisions:
A. At the time the Incentive Stock Option is granted, if the
Eligible Employee owns, directly or indirectly, stock representing more
than 10% of the total combined voting power of all classes of stock of
the Company then:
(i) The Option Price must equal at least 110% of the
Fair Market Value on the Effective Date of Grant of the Shares
subject to the Option;
(ii) The term of the Option shall not be greater than
five (5) years from the Effective Date of Grant; and
(iii) The aggregate Fair Market Value (determined at
the Effective Date of Grant) of the Shares with respect to
which Incentive Stock Options are exercisable for the first
time by the Eligible Employee during any calendar year (under
all stock option plans of the Company) shall not exceed One
Hundred Thousand Dollars ($100,000).
B. The holder of an Incentive Stock Option must remain
continuously employed by the Company for a period of at least twelve
(12) months from the Effective Date of Grant and devote his entire
working time, energy and skill to the services of the Company subject
to normal vacations, sick leave and military absences; provided,
however, that such employment shall be at the pleasure of the Board of
Directors or officers of the Company at such compensation as the
Company shall determine. Nothing contained in this Plan or in any
Option granted pursuant to it shall confer upon any employee any right
to continue in the employ of the Company or to interfere in any way
with the right of the Company to terminate employment at any
13
<PAGE> 7
time. So long as a holder of an Option shall continue to be an employee
of the Company, the Option shall not be affected by any change of the
employee's duties or position.
9.3 If any Option is not granted, exercised, or held pursuant to the
provisions noted immediately above, it will be considered to be a Non-qualified
Stock Option to the extent that any or all of the grant is in conflict with
these restrictions.
ARTICLE X
---------
TRANSFERABILITY OF OPTION
-------------------------
10.1 During the lifetime of an Eligible Employee to whom an Option has
been granted, such Option is not transferable and may be exercised only by such
individual. Upon the death of an Eligible Employee to whom an Option has been
granted, the Option may be transferred to the beneficiaries or heirs of the
holder of the Option by Will or by the laws of descent and distribution.
ARTICLE XI
----------
TERMINATION OF OPTIONS
----------------------
11.1 An Option may be terminated as follows:
A. During the period of continuous employment with the Company
or a parent or subsidiary thereof, an Option will be terminated only if
it has been fully exercised or it has expired by its terms.
B. Upon termination of employment with the Company or a parent
or subsidiary thereof for any reason other than death or a Permanent
and Total Disability, the Option may be exercised, to the extent that
the Eligible Employee shall have been entitled to exercise it at the
date of termination of employment, until the earlier of the full
exercise of the Option, the expiration of the Option by its terms or
the end of the three (3) month period following the date of
termination. For purposes of the Plan, a leave of absence approved by
the Company shall not be deemed to be termination of employment.
C. If an Eligible Employee to whom an Option was granted shall
die or becomes subject to a Permanent and Total Disability while
employed by the Company or a parent or subsidiary thereof or within
three (3) months of termination of employment for any reason, such
Option may be exercised to the extent that the Eligible Employee shall
have been entitled to exercise it at the time of death, termination of
employment or disability, as the case
14
<PAGE> 8
may be, by the Eligible Employer or by the estate of the Eligible
Employee or the person or persons to whom the Option may have been
transferred by Will or by the laws of descent and distribution, until
the earlier of the full exercise of the Option, the expiration of the
Option by its terms or the end of the one (1) year period following the
date of such death or disability.
11.2 In no event will the continuation of the term of an Option beyond
the date of termination of employment allow the Eligible Employee, or his
beneficiaries or heirs, to accrue additional rights under the Plan, or to
purchase more Shares through the exercise of an Option than could have been
purchased on the day that employment was terminated.
ARTICLE XII
-----------
ADJUSTMENTS TO SHARES AND OPTION PRICE
--------------------------------------
12.1 In the event that the Shares as presently constituted shall be
changed into or exchanged for a different kind of shares or other securities of
the Company or of another corporation (whether by reason of merger,
consolidation, recapitalization, reclassification, split-up, combination of
shares or otherwise) or if the number of such Shares shall be increased through
the payment of a stock dividend, then except as otherwise provided in Section
6.2 hereof, there shall be substituted for or added to each Share theretofore
appropriated or thereafter subject or which may become subject to an Option
under this Plan, the number and kind of shares or other securities into which
each outstanding Share shall be so changed, or for which each such Share shall
be exchanged, or to which the holder of each such Share shall be entitled, as
the case may be. Outstanding Options under this Plan shall also be appropriately
amended as to price and other terms as may be necessary to reflect the foregoing
events. In the event there shall be any other change in the number of kind of
the outstanding Shares, or of any shares or other securities into which such
Shares shall have been changed, or for which they shall have been exchanged,
then if the Committee shall, in its sole discretion, determine that such change
equitably requires an adjustment in any Option theretofore granted under the
Plan or which may be granted under the Plan, such adjustment shall be made in
accordance with such determination. Fractional shares resulting from any
adjustment pursuant to this Section 12.1 shall be rounded down to the nearest
whole number of Shares.
12.2 Notwithstanding the foregoing, any and all adjustments in
connection with an Incentive Stock Option shall comply in all respects with
Sections 422 and 424 of the Code and the regulations promulgated thereunder.
12.3 Notice of any adjustment shall be given by the Company to each
holder of an Option under this Plan which shall have been so adjusted, provided
that such
15
<PAGE> 9
adjustment (whether or not such notice is given) shall be effective and binding
for all purposes of the Plan and any instrument or agreement issued thereunder.
ARTICLE XIII
------------
OPTION AGREEMENTS
-----------------
13.1 All Options granted under the Plan shall be evidenced by a written
agreement in such form or forms as the Committee in its sole discretion may
determine.
ARTICLE XIV
-----------
AMENDMENT OR DISCONTINUANCE OF PLAN
-----------------------------------
14.1 The Board of Directors of the Company may at any time amend,
suspend or discontinue the Plan; provided, however, that no amendments by the
Board of Directors of the Company shall, without further approval of the
shareholders of the Company:
A. Change the class of Eligible Employees;
B. Except as provided in Articles III and XII hereof, increase
the number of Shares which may be subject to Options granted under the
Plan; or
C. Permit the granting of Options to the individuals who are
then members of the Committee.
14.2 No amendment to the Plan shall alter or impair any Option granted
under the Plan without the consent of the holders thereof.
ARTICLE XV
----------
EFFECTIVE DATE
--------------
15.1 This Plan shall become effective as of March 31, 1994, having been
adopted by the Board of Directors of the Company on March 4, 1994, and approved
by the affirmative vote of the holders of a majority of the shares of the
Company voting on the issue on March 31, 1994.
16
<PAGE> 10
ARTICLE XVI
-----------
MISCELLANEOUS
-------------
16.1 Certificates for Shares purchased through exercise of Options will
be issued in regular course after exercise of the Option and payment therefor as
called for by the terms of the Option. No persons holding an Option or entitled
to exercise an Option granted under this Plan shall have any rights or
privileges of a shareholder of the Company with respect to any Shares issuable
upon exercise of such Option until certificates representing such Shares shall
have been issued and delivered. No Shares shall be issued and delivered upon
exercise of an Option unless and until, in the opinion of counsel for the
Company, the Company has complied with all applicable registration requirements
of the Securities Act of 1933, as amended, and any applicable state securities
laws and with any applicable listing requirements of any national securities
exchange on which the Company's securities may then be listed as well as any
other requirements of law.
16.2 This Plan shall continue in effect until the expiration of all
Options granted under the Plan unless terminated earlier in accordance with
Article XI; provided, however, that no Option shall be granted later than ten
years after December 31, 1993.
17
<PAGE> 1
Exhibit 5
(614) 464-6400
December 22, 1998
Board of Directors
Stearns & Lehman, Inc.
30 Paragon Parkway
Mansfield, Ohio 44903
Gentlemen:
We are familiar with the proceedings taken and proposed to be
taken by Stearns & Lehman, Inc., an Ohio corporation (the "Company"), in
connection with (i) the institution of the Stearns & Lehman, Inc. Amended and
Restated 1994 Stock Option Plan (the "1994 Plan"), (ii) the granting of options
to purchase common shares, without par value (the "Common Shares"), of the
Company pursuant to the 1994 Plan and (iii) the preparation of a Registration
Statement on Form S-8 (the "Registration Statement") to be filed with the
Securities and Exchange Commission to register 275,000 Common Shares reserved
for issuance under the 1994 Plan pursuant to the provisions of the Securities
Act of 1933, as amended, and the rules and regulations promulgated thereunder.
In connection with this opinion, we have examined an original
or copy of, and have relied upon the accuracy of, without independent
verification or investigation: (a) the Registration Statement; (b) the 1994
Plan; (c) the Company's Amended Articles; (d) the Company's Amended Code of
Regulations; and (e) certain proceedings of the directors and of the
shareholders of the Company. We have also relied upon such representations of
the Company and officers of the Company and such authorities of law as we have
deemed relevant as a basis for this opinion.
18
<PAGE> 2
We have relied solely upon the examinations and inquiries
recited herein, and we have not undertaken any independent investigation to
determine the existence or absence of any facts, and no inference as to our
knowledge concerning such facts should be drawn.
Based upon and subject to the foregoing and the further
qualifications and limitations set forth below, as of the date hereof, we are of
the opinion that after the 275,000 Common Shares of the Company to be registered
under the Registration Statement have been issued and delivered by the Company
upon the exercise of options under the 1994 Plan against payment of the purchase
price therefor, in accordance with the terms of the 1994 Plan, said Common
Shares will be validly issued, fully paid and non-assessable, assuming
compliance with applicable federal and state securities laws.
Our opinion is limited to the General Corporation Law of Ohio
in effect as of the date hereof. This opinion is furnished by us solely for the
benefit of the Company in connection with the offering of the Common Shares
pursuant to the 1994 Plan and the filing of the Registration Statement and any
amendments thereto. This opinion may not be relied upon by any other person or
assigned, quoted or otherwise used without our specific written consent.
Notwithstanding the foregoing, we consent to the filing of
this opinion as an exhibit to the Registration Statement and to the reference to
us therein.
Very truly yours,
VORYS, SATER, SEYMOUR AND PEASE LLP
19
<PAGE> 1
Exhibit 23(a)
CONSENT OF INDEPENDENT AUDITORS
20
<PAGE> 2
Exhibit 23(a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of our report dated June 26, 1998 appearing on page 19 of Stearns &
Lehman, Inc.'s Annual Report on Form 10-KSB for the year ended April 30, 1998.
PricewaterhouseCoopers LLP
Columbus, Ohio
December 22, 1998
<PAGE> 1
Exhibit 24
POWERS OF ATTORNEY
22
<PAGE> 2
POWER OF ATTORNEY
The undersigned officer and/or director of Stearns & Lehman,
Inc. (the "Company"), does hereby constitute and appoint William C. Stearns and
John A. Chuprinko, or either of them, my true and lawful attorneys and agents,
each with power of substitution, to do any and all acts and things in my name
and on my behalf in any and all capacities, and to execute any and all
instruments for me and in my name in any and all capacities, which said
attorneys or agents, or any of them, may deem necessary or advisable to enable
the Company to comply with the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission,
in connection with the filing of a Registration Statement on Form S-8 in
connection with the offering of 275,000 Common Shares of the Company pursuant to
the Stearns & Lehman, Inc. 1994 Stock Option Plan, including specifically but
without limitation, power and authority to sign for me in my name in any and all
capacities, any and all amendments (including post-effective amendments) to such
Registration Statement; and I do hereby ratify and confirm all that the said
attorneys and agents, or their substitute or substitutes, or any of them, shall
do or cause to be done by virtue hereof.
s/s Sally A. Stearns
-----------------------------------
Sally A. Stearns
23
<PAGE> 3
POWER OF ATTORNEY
The undersigned officer and/or director of Stearns & Lehman,
Inc. (the "Company"), does hereby constitute and appoint William C. Stearns and
John A. Chuprinko, or either of them, my true and lawful attorneys and agents,
each with power of substitution, to do any and all acts and things in my name
and on my behalf in any and all capacities, and to execute any and all
instruments for me and in my name in any and all capacities, which said
attorneys or agents, or any of them, may deem necessary or advisable to enable
the Company to comply with the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission,
in connection with the filing of a Registration Statement on Form S-8 in
connection with the offering of 275,000 Common Shares of the Company pursuant to
the Stearns & Lehman, Inc. 1994 Stock Option Plan, including specifically but
without limitation, power and authority to sign for me in my name in any and all
capacities, any and all amendments (including post-effective amendments) to such
Registration Statement; and I do hereby ratify and confirm all that the said
attorneys and agents, or their substitute or substitutes, or any of them, shall
do or cause to be done by virtue hereof.
s/s Frank E. Duval
-----------------------------------------
Frank E. Duval
24
<PAGE> 4
POWER OF ATTORNEY
The undersigned officer and/or director of Stearns & Lehman,
Inc. (the "Company"), does hereby constitute and appoint William C. Stearns and
John A. Chuprinko, or either of them, my true and lawful attorneys and agents,
each with power of substitution, to do any and all acts and things in my name
and on my behalf in any and all capacities, and to execute any and all
instruments for me and in my name in any and all capacities, which said
attorneys or agents, or any of them, may deem necessary or advisable to enable
the Company to comply with the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission,
in connection with the filing of a Registration Statement on Form S-8 in
connection with the offering of 275,000 Common Shares of the Company pursuant to
the Stearns & Lehman, Inc. 1994 Stock Option Plan, including specifically but
without limitation, power and authority to sign for me in my name in any and all
capacities, any and all amendments (including post-effective amendments) to such
Registration Statement; and I do hereby ratify and confirm all that the said
attorneys and agents, or their substitute or substitutes, or any of them, shall
do or cause to be done by virtue hereof.
s/s Carter F. Randolph
------------------------------------
Carter F. Randolph
25
<PAGE> 5
POWER OF ATTORNEY
The undersigned officer and/or director of Stearns & Lehman,
Inc. (the "Company"), does hereby constitute and appoint William C. Stearns my
true and lawful attorney and agent, with power of substitution, to do any and
all acts and things in my name and on my behalf in any and all capacities, and
to execute any and all instruments for me and in my name in any and all
capacities, which said attorney or agent may deem necessary or advisable to
enable the Company to comply with the Securities Act of 1933, as amended, and
any rules, regulations and requirements of the Securities and Exchange
Commission, in connection with the filing of a Registration Statement on Form
S-8 in connection with the offering of 275,000 Common Shares of the Company
pursuant to the Stearns & Lehman, Inc. 1994 Stock Option Plan, including
specifically but without limitation, power and authority to sign for me in my
name in any and all capacities, any and all amendments (including post-effective
amendments) to such Registration Statement; and I do hereby ratify and confirm
all that the said attorney and agent, or his substitute or substitutes, or any
of them, shall do or cause to be done by virtue hereof.
s/s John A. Chuprinko
------------------------------------
John A. Chuprinko
26
<PAGE> 6
POWER OF ATTORNEY
The undersigned officer and/or director of Stearns & Lehman,
Inc. (the "Company"), does hereby constitute and appoint John A. Chuprinko my
true and lawful attorney and agent, with power of substitution, to do any and
all acts and things in my name and on my behalf in any and all capacities, and
to execute any and all instruments for me and in my name in any and all
capacities, which said attorney or agent may deem necessary or advisable to
enable the Company to comply with the Securities Act of 1933, as amended, and
any rules, regulations and requirements of the Securities and Exchange
Commission, in connection with the filing of a Registration Statement on Form
S-8 in connection with the offering of 275,000 Common Shares of the Company
pursuant to the Stearns & Lehman, Inc. 1994 Stock Option Plan, including
specifically but without limitation, power and authority to sign for me in my
name in any and all capacities, any and all amendments (including post-effective
amendments) to such Registration Statement; and I do hereby ratify and confirm
all that the said attorney and agent, or his substitute or substitutes, or any
of them, shall do or cause to be done by virtue hereof.
s/s William C. Stearns
--------------------------------------
William C. Stearns
27
