<PAGE>
As filed with the Securities and Exchange Commission on May 19, 2000
Registration No. 333-_______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
HA-LO INDUSTRIES, INC.
(Exact name of Registrant as specified in its charter)
------------------
ILLINOIS 36-3573412
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5980 WEST TOUHY AVENUE
NILES, ILLINOIS 60714
(847) 647-2300
(Address, including zip code, and telephone number, including area code, of
Registrant's executive offices)
------------------
HA-LO INDUSTRIES, INC. 1997 STOCK PLAN (AMENDED AND RESTATED)
-------------------------------------------------------------
(Full title of the plan)
GREGORY J. KILREA
CHIEF FINANCIAL OFFICER
HA-LO INDUSTRIES, INC.
5980 WEST TOUHY AVENUE
NILES, ILLINOIS 60714
(847) 647-2300
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With copies to:
BARRY J. SHKOLNIK, ESQ.
NEAL, GERBER & EISENBERG
TWO NORTH LASALLE STREET
CHICAGO, ILLINOIS 60602
(312) 269-8000
------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
TITLE OF SECURITIES AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED TO BE REGISTERED OFFERING PRICE PER UNIT AGGREGATE OFFERING PRICE REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
no par value 3,000,000 shares $6.65625 (1) $19,968,750.00 $5,272 (2)
===================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rules 457(c) and 457(h) under the Securities Act of 1933,
as amended, on the basis of the average of the high and low prices of
the Company's Common Stock as reported on the New York Stock Exchange
on May 16, 2000. Does not reflect an indeterminate number of shares
that may be issued as a result of anti-dilution provisions contained in
the above-referenced Plan.
(2) This Registration Statement registers additional shares of the
Registrant's Common Stock issuable pursuant to the same employee
benefit plan, as amended and restated, for which Registration Statement
Nos. 333-28361, 333-48961 and 333-66849 are currently effective.
Accordingly, pursuant to Instruction E on Form S-8, the registration
fee is being paid with respect to the additional securities only.
================================================================================
<PAGE>
INTRODUCTION
Registration Statement No. 333-28361 was filed with the Securities and
Exchange Commission (the "Commission") on June 3, 1997 by HA-LO Industries, Inc.
(the "Corporation" or the "Registrant") to register 1,500,000 shares of its
common stock, no par value (the "Common Stock"), issuable pursuant to the HA-LO
Industries, Inc. 1997 Stock Plan (Restated) (the "Plan"). Registration Statement
No. 333-48961 was filed with the Commission on March 31, 1998 to register an
additional 1,500,000 shares of Common Stock issuable pursuant to the Plan, as
amended and restated. Registration Statement No. 333-66849 was filed with the
Commission on November 5, 1998 to register an additional 3,000,000 shares of
Common Stock issuable pursuant to the Plan, as amended and restated.
Registration Statement Nos. 333-28361, 333-48961 and 333-66849 are still
effective. On February 19, 1999, the Corporation effected a 3-for-2 stock split
in the form of a stock dividend, resulting in a total of 9,000,000 shares of
Common Stock being issuable pursuant to the Plan, as amended and restated. This
Registration Statement is being filed to register 3,000,000 additional shares of
the Common Stock issuable by the Corporation pursuant to the Plan, as amended
and restated.
Except as modified hereby, the contents of the Corporation's
Registration Statements No. 333-28361, No. 333-48961 and No. 333-66849 are
incorporated herein by reference.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Securities
and Exchange Commission pursuant to the Securities Act of 1934, as amended (the
"Exchange Act"), are incorporated herein by reference and made a part hereof:
(a) Annual Report on Form 10-K for the fiscal year ended December
31, 1999 (the "HA-LO 10-K");
(b) Quarterly Report on Form 10-Q for the quarter ended March 31,
2000;
(c) Current Report on Form 8-K, dated May 12, 2000;
(d) Current Report on Form 8-K, dated January 21, 2000; and
(e) The description of the Company's Common Stock contained in the
Registration Statement dated October 20, 1992 filed pursuant
to Section 12 of the Exchange Act and any amendment or report
filed for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold, shall be
deemed incorporated by reference in this Registration Statement and to be part
hereof from the date of filing of such documents.
<PAGE>
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
4.1 HA-LO Industries, Inc. 1997 Stock Plan (Amended and Restated)
5.1 Opinion of Neal, Gerber & Eisenberg
23.1 Consent of Neal, Gerber & Eisenberg (included in Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP
24.1 Powers of Attorney (included in the signature pages hereto)
</TABLE>
2
<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 Chicago, State of Illinois, on May 18, 2000.
HA-LO INDUSTRIES, INC.
By: /s/ John R. Kelley, Jr.
-----------------------------------------------
John R. Kelley, Jr.
Chief Executive Officer
We, the undersigned officers and directors of HA-LO Industries, Inc.,
hereby severally constitute John R. Kelley, Jr., Gregory J. Kilrea and Barry J.
Shkolnik, and each of them singly, our true and lawful attorneys with full power
to them, and each of them singly, to sign for us and in our names in the
capacities indicated below, any and all amendments, including post-effective
amendments, to this Registration Statement, and generally to do all such things
in our name and behalf in such capacities to enable HA-LO Industries, Inc. to
comply with the applicable provisions of the Securities Act of 1933, as amended,
and all requirements of the Securities and Exchange Commission, and we hereby
ratify and confirm our signatures as they may be signed by our said attorneys,
or any of them, to any and all such documents.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on May 18, 2000 by the following persons
in the capacities indicated.
SIGNATURE TITLE
/s/ John R. Kelley, Jr. Chief Executive Officer
----------------------------- (Principal Executive Officer)
John R. Kelley, Jr.
/s/ Lou Weisbach Chairman of the Board
-----------------------------
Lou Weisbach
Vice Chairman
-----------------------------
Linden D. Nelson
/s/ Gregory J. Kilrea Chief Financial Officer
----------------------------- (Principal Financial Officer and
Gregory J. Kilrea Principal Accounting Officer)
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<PAGE>
/s/ Bradley A. Keywell President and Director
-----------------------------
Bradley A. Keywell
/s/ Eric Lefkofsky Chief Operating Officer,
----------------------------- Vice President and Director
Eric Lefkofsky
/s/ Thomas Herskovits Director
-----------------------------
Thomas Herskovits
/s/ Marshall J. Katz Director
-----------------------------
Marshall J. Katz
/s/ Seymour N. Okner Director
-----------------------------
Seymour N. Okner
Director
-----------------------------
Brian M. Hermelin
4
<PAGE>
EXHIBIT 4.1
HA-LO INDUSTRIES, INC.
1997 STOCK PLAN
(AMENDED AND RESTATED)*
1. PREAMBLE.
In 1997, HA-LO Industries, Inc. (the "Company") established the HA-LO
Industries, Inc. 1997 Stock Plan (the "Plan") as a means whereby the Company
may, through awards of (i) stock appreciation rights ("SARs"), (ii)
non-qualified stock options ("NSOs"), (iii) restricted stock ("Restricted
Stock"), and (iv) phantom stock ("Phantom Stock"):
(a) provide employees who have substantial responsibilities for
the direction and management of the Company and other
employees of the Company with additional incentive to promote
the success of the Company's business;
(b) enable such employees to acquire proprietary interests in the
Company;
(c) encourage such employees to remain in the employ of the
Company;
(d) provide Officers and Directors of the Company (who are not
otherwise employees of the Company) with additional incentive
to promote the success of the Company's business; and
(e) provide Sales Representatives with an incentive to remain
associated with the Company and to promote the success of the
Company's business.
By action of the Board of Directors of the Company, the Plan was
approved. The terms of the Plan are contained herein.
The provisions of this Plan do not apply to or affect any option, SAR,
or stock heretofore or hereafter granted under any other stock plan of the
Company, and all such options, SARs or stock continue to be governed by and
subject to the applicable provisions of the plan under which they were granted.
Restrictive provisions contained in any amendments to, or restatements of, this
Plan do not apply to or affect any option, SAR, or stock heretofore granted
under this Plan, and all such options, SARs or stock continue to be governed by
and subject to the applicable provisions of this Plan in effect at the time they
were granted.
- ----------------------
* Amended as of May 18, 2000.
<PAGE>
2. DEFINITIONS.
2.01 "BOARD" or "BOARD OF DIRECTORS" means the board of directors
of the Company.
2.02 "CAUSE" means, as determined in the sole discretion of the
Board, a Participant's (1) commission of a felony; (2) dishonesty or
misrepresentation involving the Company; (3) serious misconduct in the
performance or non-performance of Participant's responsibilities to the Company;
(4) violation of a material condition of employment; (5) unauthorized use of
trade secrets or confidential information; (6) aiding a competitor of the
Company.
2.03 "CHANGE IN CONTROL" means, the occurrence of any one of the
following events:
(a) any consolidation or merger of the Company, if the
Company is not the continuing or surviving corporation or which
contemplates that all or substantially all of the business and/or
assets of the Company shall be controlled by another corporation or a
recapitalization in which the current controlling stockholders do not
continue to be the controlling stockholders;
(b) any sale, lease, exchange or transfer (in one
transaction or series of related transactions) of all or substantially
all of the assets of the Company;
(c) approval by the stockholders of the Company of any
plan or proposal for the liquidation or dissolution of the Company,
unless such plan or proposal is abandoned within 60 days following such
approval;
(d) any "person" (as such term is used in Sections 13(d)
and 14(d)(2) of the Exchange Act), other than a person who is a
stockholder of the Company on the Option Date, who shall become the
beneficial owner of securities of the Company representing more than
50% of the combined voting power of the Company's then outstanding
securities ordinarily having the right to vote in the election of
directors;
(e) any sale, exchange or transfer (other than transfers
among affiliated entities, i.e. entities controlling, controlled by or
under common control with, the transferor) of securities of the Company
representing more than 50% of (i) the total fair market value of the
Company's then outstanding equity securities, or (ii) the combined
voting power of the Company's then outstanding securities ordinarily
having the right to vote in the election of directors, whether pursuant
to a tender or exchange offer, open market offering, purchase or sale,
privately negotiated purchase and sale or otherwise; or
(f) if during a period of two consecutive years from the
Option Date, individuals who at the beginning of such period
constituted the directors of the Company cease for any reason to
constitute a majority thereof, unless the election, or nomination for
election by the Company's stockholders, of each director of the Company
first elected
2
<PAGE>
during such period was approved by a vote of at least a majority of
the directors then still in office who were directors at the
beginning of any such period.
2.04 "CODE" means the Internal Revenue Code of 1986, as it exists
now and as it may be amended from time to time.
2.05 "COMMITTEE" means the Compensation Committee of the Board of
Directors. Each member of the Committee shall (a) be a "Non-Employee Director"
as determined under Rule 16b-3(b)(3)(i) of the Exchange Act and (b) be an
"Outside Director" as determined under Treasury Regulation 26 CFR Section
1.162-27(e)(3) or any successor regulation thereto. Once appointed, the members
of the Committee shall continue to serve until otherwise directed by the Board
of Directors.
2.06 "COMMON STOCK" means the common stock of the Company, no par
value.
2.07 "COMPANY" shall means HA-LO Industries, Inc., an Illinois
corporation, any successor thereto and any subsidiary thereof.
2.08 "DIRECTOR" means a member of the Board.
2.09 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as it exists now or from time to time may hereafter be amended.
2.10 "FAIR MARKET VALUE" means, at the discretion of the Company in
each case, either (a) the mean between the bid and asked prices or (b) the last
sale price, as of the close of business on the day Fair Market Value is to be
determined, for Common Stock as reported by the NASDAQ System or any other stock
exchange on which the Common Stock is traded. If Common Stock is not traded on
that day, then the Fair Market Value shall be determined as of the next
preceding day on which such stock was traded. If trading of the Common Stock is
not reported by the NASDAQ System or on a stock exchange, Fair Market Value will
be determined by the Board based upon the best available data.
2.11 "NAKED SAR" means a SAR issued not in connection with a ISO or
NSO.
2.12 "NSO" means non-qualified stock options, which are NOT
intended to qualify under Section 422 of the Code.
2.13 "OFFICER" means a corporate officer of the Company.
2.14 "OPTION" means the right of a participant to purchase a
specified number of shares of Common Stock, subject to the terms and conditions
of the Plan.
2.15 "OPTION DATE" means the date upon which an Option, SAR,
Restricted Stock or
3
<PAGE>
Phantom Stock is awarded to a Participant under the Plan.
2.16 "OPTION PRICE" means the price per share at which an Option
may be exercised.
2.17 "PARTICIPANT" means an individual to whom an Option, SAR,
Phantom Stock or Restricted Stock has been granted under the Plan.
2.18 "PHANTOM STOCK" means a hypothetical share of Common Stock
issued as phantom stock under the Plan.
2.19 "PLAN" means the HA-LO Industries, Inc. 1997 Stock Plan, as
set forth herein and as from time to time amended.
2.20 "RESTRICTED STOCK" means Common Stock awarded to a Participant
pursuant to this Plan and subject to the restrictions contained in Section 8.
2.21 "SALES REPRESENTATIVE" means an independent contractor who has
an arrangement with the Company, whether or not exclusively, to market, promote
and sell the Company's products.
2.22 "SAR" means a stock appreciation right. A SAR may be a Naked
SAR or a Tandem SAR.
2.23 "TANDEM SAR" means a SAR associated with and issued in
connection with an Option.
2.24 RULES OF CONSTRUCTION.
(a) GOVERNING LAW. The construction and operation of this Plan are
governed by the laws of the State of Illinois.
(b) UNDEFINED TERMS. Unless the context requires another meaning,
any term not specifically defined in this Plan has the meaning
given to it by the Code.
(c) HEADINGS. All headings in this Plan are for reference only and
are not to be utilized in construing the Plan.
(d) GENDER. Unless clearly appropriate, all nouns of whatever
gender refer indifferently to persons or objects of any
gender.
(e) SINGULAR AND PLURAL. Unless clearly inappropriate, singular
terms refer also to the plural and VICE VERSA.
4
<PAGE>
(f) SEVERABILITY. If any provision of this Plan is determined to
be illegal or invalid for any reason, the remaining provisions
are to continue in full force and effect and to be construed
and enforced as if the illegal or invalid provision did not
exist, unless the continuance of the Plan in such
circumstances is not consistent with its purposes.
3. STOCK SUBJECT TO THE PLAN.
Except as otherwise provided in Section 12, the aggregate number of
shares of Common Stock that may be issued under Options or as Restricted Stock,
under this Plan may not exceed Twelve Million (12,000,000) shares. Reserved
shares may be either authorized but unissued shares or treasury shares, in the
Board's discretion. If any awards hereunder shall terminate or expire, as to any
number of shares, new NSOs and Restricted Stock may thereafter be awarded with
respect to such shares. The aggregate number of shares of Common Stock that may
be issued under Options, as Restricted Stock or upon which SARs or Phantom Stock
may be awarded to any one Participant may not exceed 500,000, as may be adjusted
pursuant to Section 12.
4. ADMINISTRATION.
The Plan is administered by the Committee. In addition to any other
powers set forth in this Plan, the Committee has the following powers:
(a) to construe and interpret the Plan, including the power to
remedy any ambiguities or inconsistencies in the Plan
document;
(b) to establish, amend and rescind appropriate rules and
regulations relating to the Plan;
(c) subject to the express provisions of the Plan, to determine
the individuals who will receive awards of Options, Restricted
Stock, Phantom Stock and/or SARs, the times when they will
receive them, the number of shares to be subject to each award
and the Option Price, payment terms, payment method, and
expiration date applicable to each award;
(d) to contest on behalf of the Company or Participants, at the
expense of the Company, any ruling or decision on any matter
relating to the Plan or to any awards of NSOs, Restricted
Stock, Phantom Stock and/or SARs;
(e) generally, to administer the Plan, and to take all such steps
and make all such determinations in connection with the Plan
and the awards of NSOs, Restricted Stock, Phantom Stock and/or
SARs granted thereunder as it may deem necessary or advisable;
5
<PAGE>
(f) to determine the form in which payment of a SAR or a Phantom
Stock award granted hereunder will be made (i.e., cash, Common
Stock or a combination thereof) or to approve a participant's
election to receive cash in whole or in part in settlement of
the SAR or Phantom Stock award; and
(g) to determine the form in which tax withholding under Section
15 of this Plan will be made.
The Committee may delegate some or all of its power to the Chief
Executive Officer or other executive officer of the Company as the Committee
deems appropriate; provided, that (i) the Committee may not delegate its power
with regard to the grant of an award of an NSO, Restricted Stock, Phantom Stock
and/or an SAR to any person who is a "covered employee" within the meaning of
Section 162(m) of the Code or who, in the Committee's judgment, is likely to be
a covered employee at any time during the period such an award to such employee
would be outstanding and (ii) the Committee may not delegate its power with
regard to the selection for participation in this Plan of an officer or other
person subject to Section 16 of the Exchange Act or decisions concerning the
timing, pricing or amount of an award of an NSO, Restricted Stock, Phantom Stock
and/or an SAR to such an officer or other person.
5. ELIGIBILITY.
The Committee shall have the power to award Options, SARs, Restricted
Stock, and Phantom Stock. Subject to the provisions of the Plan, the Committee
shall determine from time to time those employees, Directors and Officers of the
Company and Sales Representatives who shall be designated as Participants and
the number, if any, of Options, SARs, Restricted Stock, and Phantom Stock, or
any combination thereof, to be awarded to each such participant.
6. TERMS AND CONDITIONS OF NON-QUALIFIED STOCK OPTION.
The Committee may, in its discretion, grant NSOs to any Participant
under the Plan. Each NSO shall be evidenced by an agreement between the Company
and the Participant. Unless the Committee (in its discretion) determines
otherwise, each NSO agreement, in such form as is approved by the Committee,
shall be subject to the following terms and conditions and to such other terms
and conditions as the Committee may deem appropriate:
(a) OPTION PERIOD. Each NSO will expire as of the earliest of:
(i) the date on which it is forfeited under the
provisions of Section 11;
(ii) the date three months after the Participant's
termination of employment, directorship or
relationship with the Company, as applicable, for any
reason other than death; or
6
<PAGE>
(iii) the date six months after the Participant's death.
(b) OPTION PRICE. At the time of grant, the Committee will fix the
Option Price, which will be no less than eighty-five percent
(85%) of the Fair Market Value of the shares subject to the
NSO on the Option Date.
(c) OTHER OPTION PROVISIONS. The form of NSO authorized by the
Plan may contain such other provisions as the Committee may
from time to time determine.
7. TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS.
The Committee may, in its discretion, grant a SAR to any Participant
under the Plan. Each SAR shall be evidenced by an agreement between the Company
and the Participant, in such form as is approved by the Committee, and may be a
Naked SAR or a Tandem SAR. Unless the Committee (in its discretion) determines
otherwise, each SAR awarded to Participants under the Plan shall be subject to
the following terms and conditions and to such other terms and conditions as the
Committee may deem appropriate:
(a) TANDEM SARs. Tandem SARs shall terminate on the same date as
the related NSO. A Tandem SAR shall be exercisable only if the
Fair Market Value of a share of Common Stock on the date of
surrender exceeds the Fair Market Value of the Common Stock on
the Option Date, if related to an NSO, and then shall be
exercisable to the extent, and only to the extent, that the
related NSO is exercisable. A Tandem SAR shall entitle the
Participant to whom it is granted the right to elect, so long
as such Tandem SAR is exercisable and subject to such
limitations as the Committee shall have imposed, to surrender
any then exercisable portion of his related NSO, in whole or
in part, and receive from the Company in exchange, without any
payment of cash (except for applicable employee withholding
taxes), that number of shares of Common Stock having an
aggregate Fair Market Value on the date of surrender equal to
the product of (i) the excess of the Fair Market Value of a
share of Common Stock on the date of surrender over the per
share Option Price under such NSO or the Fair Market Value of
the Common Stock on the Option Date, if such SAR is related to
an NSO and (ii) the number of shares of Common Stock subject
to such NSO or portion thereof which is surrendered. Any NSO
or portion thereof which is surrendered shall no longer be
exercisable. The Committee, in its sole discretion, may allow
the Company to settle all or part of the Company's obligation
arising out of the exercise of a Tandem SAR by the payment of
cash equal to the aggregate Fair Market Value of the shares of
Common Stock which the Company would otherwise be obligated to
deliver.
7
<PAGE>
(b) NAKED SARs. Naked SARs shall terminate as provided in the
Participant's SAR agreement. The Committee may at the time of
granting any Naked SAR add such conditions and limitations to
the Naked SAR as it shall deem advisable, including but not
limited to, limitations on the period within which the Naked
SAR shall be exercisable and the maximum amount of
appreciation to be recognized with regard to such Naked SAR.
(c) OTHER CONDITIONS. If a Participant is subject to Section 16(a)
and Section 16(b) of the Exchange Act, the Committee may at
any time add such additional conditions and limitations to
such SAR which, in its discretion, the Committee deems
necessary or desirable in order to comply with such Section
16(a) or Section 16(b) and the rules and regulations issued
thereunder, or in order to obtain any exemption therefrom.
8. TERMS AND CONDITIONS OF RESTRICTED STOCK AWARDS.
The Committee, in its discretion, may grant Restricted Stock to any
Participant under the Plan. Each grant of Restricted Stock shall be evidenced by
an agreement between the Company and the Participant. Unless the Committee (in
its discretion) determines otherwise, all shares of Common Stock awarded to
Participants under the Plan as Restricted Stock shall be subject to the
following terms and conditions and to such other terms and conditions as the
Committee may deem appropriate:
(a) RESTRICTED PERIOD. Shares of Restricted Stock awarded to
Participants may not be sold, transferred, pledged or
otherwise encumbered before they vest. Subject to the
provisions of subparagraphs (b) and (c) below and any other
restrictions imposed by law, any shares of Restricted Stock
that vest will be transferred, to the Participant or, in the
event of his death, to the beneficiary or beneficiaries
designated by writing filed by the Participant with the
Committee for such purpose or, if none, to his estate.
Delivery of shares in accordance with the preceding sentence
shall be made within the thirty-day period after they vest.
(b) FORFEITURES. A Participant shall forfeit all unpaid
accumulated dividends and all shares of Restricted Stock which
have not vested prior to the date that his employment,
membership on the Board, if a Director, or relationship, if a
Sales Representative with the Company is terminated for any
reason.
(c) CERTIFICATES DEPOSITED WITH COMPANY. Each certificate issued
in respect of shares of Restricted Stock awarded under the
Plan shall be registered in the name of the Participant and
deposited with the Company. Each such certificate shall bear
the following (or a similar) legend:
"The transferability of this certificate and the shares of
stock represented hereby
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<PAGE>
are subject to the terms and conditions (including
forfeiture) relating to Restricted Stock contained in the
HA-LO Industries, Inc. 1997 Stock Plan (Amended and Restated)
and an agreement entered into between the registered owner
and HA-LO Industries, Inc. Copies of such Plan and agreement
are on file at the principal office of HA-LO Industries, Inc."
(d) STOCKHOLDER RIGHTS. Subject to the foregoing restrictions,
each Participant shall have all the rights of a stockholder
with respect to his shares of Restricted Stock including, but
not limited to, the right to vote such shares.
(e) DIVIDENDS. On each Common Stock dividend payment date, each
Participant shall receive an amount equal to the dividend paid
on that date on a share of Common Stock, multiplied by his
number of shares of Restricted Stock.
9. TERMS AND CONDITIONS OF PHANTOM STOCK.
The Committee may, in its discretion, award Phantom Stock to any
Participant under the Plan. Each award of Phantom Stock shall be evidenced by an
agreement between the Company and the Participant. The Committee may at the time
of awarding any Phantom Stock add such additional conditions and limitations to
the Phantom Stock as it shall deem advisable, including, but not limited to, the
right for Participants to receive payments equivalent to dividends paid on
Common Stock, limitations on the period or periods within which the Phantom
Stock may be surrendered, and the maximum amount of appreciation to be
recognized with regard to such Phantom Stock. If a Participant is subject to
Section 16(a) and Section 16(b) of the Exchange Act, the Committee may at any
time add such additional conditions and limitations to such Phantom Stock which,
in its discretion, the Committee deems necessary or desirable in order to comply
with such Section 16(a) or Section 16(b) and the rules and regulations issued
thereunder, or in order to obtain any exemption therefrom. An award of Phantom
Stock shall entitle the Participant to whom it is awarded the right to elect, so
long as such Phantom Stock is vested and subject to such limitations as the
Committee shall have imposed, to surrender any then vested portion of the
Phantom Stock, in whole or in part, and receive from the Company in exchange
therefor the Fair Market Value on the date of surrender of the Common Stock to
which the surrendered Phantom Stock relates in cash or in shares of Common Stock
as the Committee may determine.
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10. MANNER OF EXERCISE OF OPTIONS.
To exercise an Option in whole or in part, a Participant (or, after his
death, his executor or administrator) must give written notice to the Committee,
stating the number of shares to which he intends to exercise the Option. The
Company will issue the shares with respect to which the Option is exercised upon
payment in full of the Option Price. Upon receipt of such notice, and prior to
issuance of shares, the Company may require the Participant (or after his death,
his executor or administrator) to pay to the Company any and all amounts which
the Participant may owe the Company on such date. The Option Price may be paid
in cash, certified bank check or by delivery of irrevocable instructions to a
broker to promptly deliver to the Company the amount of sale or loan proceeds
necessary to pay for all Common Stock acquired through such exercise and any tax
withholding obligations resulting from such exercise. At the discretion of the
Company, the Option Price may also be paid in shares of Common Stock having an
aggregate Fair Market Value, as determined on the date of delivery, equal to the
Option Price. At the discretion of the Company, the Option Price may be paid in
shares of Common Stock which were received by the Participant upon the exercise
of one or more Options, including shares which the Participant directs the
Company to withhold for the purpose of paying the Option Price from shares the
Participant would have received upon the exercise of the Option. At the
discretion of the Company, the Option Price may be paid in shares of Common
Stock which were received by the Participant as an award of Restricted Stock
under the Plan. The Option Price may be paid by surrender of Tandem SARs equal
to the Option Price.
11. VESTING.
(a) A Participant may not exercise an Option or surrender
a SAR or Phantom Stock until it has become vested. The portion of an
Option, SAR or Phantom Stock award that is vested depends upon the
period that has elapsed since the Option Date. The following schedule
applies to any Options granted under this Plan, to Restricted Stock,
SARs, and Phantom Stock awarded under this Plan unless the Committee
establishes a different vesting schedule (as set forth in the agreement
between the Participant and the Company that governs such award) at the
time when an Option is granted or the Restricted Stock, SAR or Phantom
Stock is awarded:
<TABLE>
<CAPTION>
Number of Years
Since Option Date Vested Percentage
----------------- -----------------
<S> <C>
Fewer than one 0%
One but fewer than two 20%
Two but fewer than three 40%
Three but fewer than four 60%
Four but fewer than five 80%
Five or more 100%
</TABLE>
10
<PAGE>
If a Participant's employment with, or if a Director, his membership on
the Board of, or if a Sales Representative, his relationship with, the
Company terminates for any reason, he will be deemed to have forfeited,
as of the date of such termination, any Options, Restricted Stock, SARs
and/or Phantom Stock that are not yet vested as of such date. A
transfer from the Company to a subsidiary or affiliate, or VICE VERSA
is not a termination of employment for purposes of this Plan.
Notwithstanding the vesting schedule contained herein or in the
Participant's agreement, if the Participant's employment, or if a
Director, his membership on the Board, or if a Sales Representative,
his relationship is terminated for Cause, the Participant's Vested
Percentage shall be 0%, and he shall forfeit all Options, SARs,
Restricted Stock and/or Phantom Stock, automatically and without any
action being required on the part of the Company, effective as of
delivery of notice that his termination was for Cause.
(b) Notwithstanding the provisions of Section 11(a) or
anything contained in a Participant's agreement to the contrary, upon a
Change in Control all Options, Restricted Stock, SARs and/or Phantom
Stock shall become 100% vested and immediately exercisable; PROVIDED,
HOWEVER, that the terms of this Section 11(b) shall NOT apply to
Options, Restricted Stock, SARs and/or Phantom Stock granted after May
18, 2000.
12. ADJUSTMENTS TO REFLECT CHANGES IN CAPITAL STRUCTURE.
If there is any change in the corporate structure or shares of the
Company, the Board of Directors may make any adjustments necessary to prevent
accretion, or to protect against dilution, in the number and kind of shares
authorized by the Plan and, with respect to outstanding Options, Restricted
Stock, Phantom Stock and/or SARs, in the number and kind of shares covered
thereby and in the applicable Option Price. For the purpose of this Section 12,
a change in the corporate structure or shares of the Company includes, without
limitation, any change resulting from a recapitalization, stock split, stock
dividend, consolidation, rights offering, spin-off, reorganization, or
liquidation and any transaction in which shares of Common Stock are changed into
or exchanged for a different number or kind of shares of stock or other
securities of the Company or another corporation.
13. LIMITED TRANSFERABILITY OF OPTIONS, SARS AND PHANTOM STOCK.
The Options and SARs granted or Phantom Stock awarded under the Plan
are not transferable, voluntarily or involuntarily, other than by will, by
the laws of descent and distribution or pursuant to a qualified domestic
relations order as defined in Section 414(p) of the Code; PROVIDED, HOWEVER,
that Options may be transferred in whole or in part during the Participant's
lifetime by gift to one or more members of the Participant's family, to a
trust in which the Participant's family members have more than fifty percent
of the beneficial interest, to a foundation in which the Participant or his
or her family
11
<PAGE>
members control the management of assets, or to any other entity in which
the Participant or his or her family members own more than fifty percent of the
voting interests. Notwithstanding the foregoing, Options may not be transferred
for value; PROVIDED, HOWEVER, that the following transactions are not prohibited
transfers for value:
(i) a transfer under a domestic relations order in settlement of
marital property rights; and
(ii) a transfer to an entity in which more than fifty percent of
the voting interests are owned by the Participant or his or her family
members in exchange for an interest in that entity.
The assigned portion may only be exercised by the person or persons who acquire
a proprietary interest in the Option pursuant to the assignment. The terms
applicable to the assigned portion shall be the same as those in effect for the
Option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Committee may deem appropriate.
14. RIGHTS AS STOCKHOLDER.
No Common Stock may be delivered upon the exercise of any Option until
full payment has been made. A Participant has no rights whatsoever as a
stockholder with respect to any shares covered by an Option until the date of
the issuance of a stock certificate for the shares. A Participant who has been
granted SARs or Phantom Stock shall have no rights whatsoever as a stockholder
with respect to such SARs or Phantom Stock.
15. WITHHOLDING TAX.
The Company shall have the right to withhold in cash or shares of
Common Stock with respect to any payments made to Participants under the Plan
any taxes required by law to be withheld because of such payments.
Notwithstanding the foregoing, with respect to a Participant subject to Section
16(a) or 16(b) of the Exchange Act, all amounts required to be withheld upon
either (i) the vesting of Restricted Stock or (ii) the exercise of a SAR or
surrender of Phantom Stock which had a set duration and for which payment is
made in Common Stock, shall automatically be withheld in Common Stock otherwise
deliverable to the Participant and having a Fair Market Value determined on the
date the income is includable in the Participant's income equal to the amount of
taxes required to be withheld.
16. NO RIGHT TO EMPLOYMENT.
Participation in the Plan will not give any Participant a right to be
retained as an employee of the Company, or any right or claim to any benefit
under the Plan, unless the right or claim has specifically accrued under the
Plan.
12
<PAGE>
17. AMENDMENT OF THE PLAN.
The Board of Directors may from time to time amend or revise the terms
of this Plan in whole or in part and may without limitation, adopt any amendment
deemed necessary; provided, however, that no change in any award previously
granted to a Participant may be made that would impair the rights of the
Participant without the Participant's consent.
18. CONDITIONS UPON ISSUANCE OF SHARES.
An Option shall not be exercisable, a share of Common Stock shall not
be issued pursuant to the exercise of an Option, and Restricted Stock shall not
be awarded until such time as the award of Restricted Stock, exercise of such
Option and the issuance and delivery of such share pursuant thereto shall comply
with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which
the shares of Common stock may then be listed, and shall be further subject to
the approval of counsel for the Company with respect to such compliance. As a
condition to the exercise of an Option, the Company may require the person
exercising such Option to represent and warrant at the time of any such exercise
that the Common Stock is being purchased only for investment and without any
present intention to sell or distribute such shares if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned relevant provisions of law.
19. EFFECTIVE DATE AND TERMINATION OF PLAN.
19.1 EFFECTIVE DATE. This Plan is effective as of January 1, 1997.
19.02 TERMINATION OF THE PLAN. The Board of Directors may terminate
the Plan at any time with respect to any shares that are not then subject to
Options or Restricted Stock. Termination of the Plan will not affect the rights
and obligations of any Participant with respect to Options, SARs, Phantom Stock
or Restricted Stock awarded before termination.
20. DIRECTOR STOCK OPTIONS.
(a) Each Director who is not otherwise an employee of the Company
from and after the effective date of the Plan shall, at the
first regularly scheduled meeting of the Board held after
January 1 of each calendar year, automatically be granted NSOs
to purchase ten thousand (10,000) shares of Common Stock
having an exercise price per share equal to 100% of the Fair
Market Value of the Common Stock at the Option Date.
(b) Each Director's interest in any NSO granted pursuant to this
Section 20 shall vest ratably over a period of twelve months
from the Option Date; provided, however, such NSO may not be
exercised at any time prior to six months after the Option
Date. NSOs granted pursuant to this Section 20 shall expire
ten years from the
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<PAGE>
Option Date.
(c) In the event that the number of shares of Common Stock
available for future grant under the Plan is insufficient to
make all automatic grants required to be made on such date,
then all non-employee Directors entitled to a grant on such
date shall share ratably in the number of NSOs on shares
available for grant under the Plan.
(d) The provisions of paragraph (a) of this Section 20 may not be
amended more often than once every six months. Except as
expressly provided in this Section 20, any NSO granted
hereunder shall be subject to the terms and conditions of the
Plan if the grant were made pursuant to Section 6 hereof.
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<PAGE>
EXHIBIT 5.1
May 19, 2000
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: HA-LO Industries, Inc.
Registration Statement on Form S-8
Ladies and Gentlemen:
We are counsel to HA-LO Industries, Inc., an Illinois corporation (the
"Company"), and in such capacity we have assisted in the preparation and filing
with the Securities and Exchange Commission under the Securities Act of 1993, as
amended, of the Company's Registration Statement on Form S-8 (the "Registration
Statement") relating to the issuance from time to time by the Company of up to
an additional 3,000,000 shares of the Company's common stock, no par value per
share (the "Common Stock"), pursuant to the HA-LO Industries, Inc. 1997 Stock
Plan (Amended and Restated) (the "Plan").
As such counsel, we have examined the Plan, the Company's Restated
Articles of Incorporation, as amended, the Amended and Restated Bylaws of the
Company, the minute books of the Company and such other papers, documents and
certificates of public officials and certificates of officers of the Company as
we have deemed relevant and necessary as the basis for the opinions hereinafter
expressed. In such examinations, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals
and the conformity to original documents of all documents submitted to us as
conformed or photostatic copies.
Based on the foregoing, we are of the opinion that:
1. The issuance from time to time by the Company of up
to an additional 3,000,000 shares of Common Stock pursuant to the Plan
as described in the prospectus previously delivered to participants in
the Plan (the "Prospectus") has been duly and validly authorized by all
necessary corporate action on the part of the Company.
2. When issued and paid for as described in the
Prospectus and in accordance with the Plan, the additional 3,000,000
shares available for issuance under the Plan will be duly and validly
issued and outstanding, fully paid and non-assessable shares of Common
Stock.
<PAGE>
Securities and Exchange Commission
May 19, 2000
Page 2
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Please be advised that certain partners of, attorneys associated with
and/or of counsel to our firm beneficially own shares of Common Stock.
The opinions expressed above are limited to the laws of the State of
Illinois and the federal laws of the United States, and are limited to the
specific legal matters expressly addressed herein. No opinion is expressed with
respect to the laws of any other jurisdiction or any legal matter not addressed
herein. This opinion speaks only as of the date hereof and we undertake no
obligation to update this opinion.
Very truly yours,
/s/ NEAL, GERBER & EISENBERG
<PAGE>
EXHIBIT 23.2
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
March 22, 2000 included in HA-LO Industries, Inc.'s Annual Report on Form 10-K
for the year ended December 31, 1999 and to all references to our Firm included
in this registration statement.
/s/ ARTHUR ANDERSEN LLP
Chicago, Illinois
May 19, 2000
