AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 21, 1997
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
-------------------
SUNGLASS HUT INTERNATIONAL, INC.
-------------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
FLORIDA 65-0667471
------------------------------- ----------------------
(STATE OR OTHER JURISDICTION OF (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
255 ALHAMBRA CIRCLE
CORAL GABLES, FLORIDA 33134
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
SUNGLASS HUT INTERNATIONAL, INC. 1996 EXECUTIVE INCENTIVE COMPENSATION PLAN
-------------------------------------------------------------------------------
(FULL TITLE OF THE PLAN)
-------------------
LARRY G. PETERSEN
SENIOR VICE PRESIDENT-FINANCE AND CHIEF FINANCIAL OFFICER
SUNGLASS HUT INTERNATIONAL, INC.
255 ALHAMBRA CIRCLE
CORAL GABLES, FLORIDA 33134
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(NAME AND ADDRESS OF AGENT FOR SERVICE)
(305) 461-6100
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(TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPY TO:
Michael W. Hein, Esq.
Greenberg, Traurig, Hoffman,
Lipoff, Rosen & Quentel, P.A.
1221 Brickell Avenue
Miami, Florida 33131
(305) 579-0673
-------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==============================================================================================================================
PROPOSED MAXIMUM PROPOSED
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE (1) OFFERING PRICE(1) REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMON STOCK,
$.01 PAR VALUE.................. 6,000,000 SHARES $5.875 $35,250,000.00 $10,682.00
==============================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee and
computed in accordance with Rule 457(h) of the Securities Act of 1933, as
amended, on the basis of the average of the high and low sale price of the
Common Stock on January 17, 1997.
<PAGE>
PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant hereby incorporates by reference into this Registration
Statement the following documents filed with the Securities and Exchange
Commission (the "Commission") by the Registrant:
(a) the Registrant's Annual Report on Form 10-K for the fiscal year
ended February 3, 1996;
(b) the Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended May 4, 1996;
(c) the Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended August 3, 1996;
(d) the Registrant's Quarterly Report on Form 10-Q for the fiscal
quarter ended November 2, 1996;
(e) all other reports filed by the Registrant pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), since November 2, 1996; and
(f) the description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-B filed on August
23, 1996, which description is hereby incorporated by reference
to the following sections of the Proxy Statement filed on May 2,
1996 by the Registrant's predecessor, Sunglass Hut International,
Inc., a Delaware corporation (Commission File No. 0-21690): (i)
"Outstanding Voting Securities and Voting Rights," and (ii)
Proposal No. 3 -- "Description of Capital Stock and Voting
Rights."
In addition, all documents subsequently filed by the Registrant pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing
of a post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated herein by reference and to be a 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.
Not applicable.
II - 1
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant has authority under Section 607.0850 of the Florida
Business Corporation Act to indemnify its directors and officers to the extent
provided in such statute. The Registrant's Articles of Incorporation provide
that the Registrant shall indemnify and may advance expenses to its officers and
directors to the fullest extent permitted by law in existence either now or
hereafter. The Registrant has entered or will enter into an agreement with each
of its directors and certain of its officers wherein it has agreed to indemnify
each of them to the fullest extent permitted by law.
The provisions of the Florida Business Corporation Act that authorize
indemnification do not eliminate the duty of care of a director, and in
appropriate circumstances, equitable remedies such as injunctive or other forms
of nonmonetary relief will remain available under Florida law. In addition, each
director will continue to be subject to liability for (a) violations of criminal
law, unless the director had reasonable cause to believe his conduct was lawful
or had no reasonable cause to believe his conduct was unlawful; (b) deriving an
improper personal benefit from a transaction; (c) voting for or assenting to an
unlawful distribution; and (d) willful misconduct or a conscious disregard for
the best interests of the Registrant in a proceeding by or in the right of the
Registrant to procure a judgment in its favor or in a proceeding by or in the
right of a shareholder. The statute does not affect a director's
responsibilities under any other law, such as the federal securities laws or
state or federal environmental laws.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See "Exhibit Index" on page II-4 below.
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, as amended (the
"Securities Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this 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 this Registration Statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information
in this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) shall 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 Exchange Act that are incorporated by
reference in this Registration Statement.
II - 2
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act, 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, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (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 this 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 may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
II - 3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, 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 Coral Gables, State of Florida on January 16, 1997.
SUNGLASS HUT INTERNATIONAL, INC.
By: /S/ JACK B. CHADSEY
------------------------------------
Jack B. Chadsey
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Jack B. Chadsey and Larry G. Petersen his
true and lawful attorneys-in-fact, each acting alone, with full powers of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any or all amendments, including any
post-effective amendments, to this Registration State- ment, and to file the
same, with exhibits thereto, and other documents to be filed in connection
therewith, with the Commission, hereby ratifying and confirming all that said
attorneys-in-fact or their substitutes, each acting alone, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C> <C>
/S/ JACK B. CHADSEY President, Chief Executive January 16, 1997
- ------------------------------ Officer and Director
Jack B. Chadsey (principal executive officer)
/S/ LARRY G. PETERSEN Senior Vice President - Finance January 16, 1997
- ------------------------------ and Chief Financial Officer
Larry G. Petersen (principal financial officer)
/S/ GEORGE L. PITA Vice President - Finance and January 16, 1997
- ------------------------------ International Development
George L. Pita (principal accounting officer)
/S/ JAMES N. HAUSLEIN Chairman of the Board January 16, 1997
- ------------------------------
James N. Hauslein
/S/ ROHIT M. DESAI Director January 16, 1997
- ------------------------------
Rohit M. Desai
/S/ JOHN H. DUERDEN Director January 16, 1997
- ------------------------------
John H. Duerden
/S/ WILLIAM S. FIELD Director January 16, 1997
- ------------------------------
William S. Field
/S/ ROBERT C. GRAYSON Director January 16, 1997
- ------------------------------
Robert C. Grayson
/S/ WILLIAM E. PHILLIPS Director January 16, 1997
- ------------------------------
William E. Phillips
</TABLE>
II - 4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIAL
NUMBER DESCRIPTION PAGE NO.
------- ----------- -----------
<S> <C> <C>
4.1 Registrant's Articles of Incorporation(1)
4.2 Registrant's Bylaws(2)
5.1 Opinion of Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel,
P.A. ___
10.1 Sunglass Hut International, Inc. 1996 Executive Incentive
Compensation Plan ___
23.1 Consent of Arthur Andersen LLP ___
23.2 Consent of Coopers & Lybrand LLP ___
23.3 Consent of Greenberg, Traurig, Hoffman, Lipoff, Rosen & Quentel,
P.A. (contained in its opinion filed as Exhibit 5.1 hereto)
24.1 Power of Attorney is included in the "Signatures" section of
this Registration Statement
</TABLE>
- -----------------------------
(1) Incorporated by reference to Exhibit 3.1 filed with the Registrant's
Registration Statement on Form 8-B filed on August 23, 1996.
(2) Incorporated by reference to Exhibit 3.2 filed with the Registrant's
Registration Statement on Form 8-B filed on August 23, 1996.
II - 5
EXHIBIT 5.1
GREENBERG, TRAURIG, HOFFMAN,
LIPOFF, ROSEN & QUENTEL, P.A.
January 21, 1997
Sunglass Hut International, Inc.
255 Alhambra Circle
Coral Gables, Florida 33134
RE: REGISTRATION STATEMENT ON FORM S-8 FOR SUNGLASS HUT
INTERNATIONAL, INC.'S 1996 EXECUTIVE INCENTIVE COMPENSATION PLAN
On the date hereof, Sunglass Hut International, Inc., a Florida
corporation (the "Company"), transmitted for filing with the Securities and
Exchange Commission (the "Commission") a Registration Statement on Form S-8 (the
"Registration Statement"), under the Securities Act of 1933, as amended (the
"Act"). The Registration Statement relates to the issuance, offering and/or sale
by the Company of up to 6,000,000 shares (the "Shares") of the Company's Common
Stock, par value $.01 per share (the "Common Stock"), which may be issued
pursuant to stock options, restricted stock, deferred stock, and/or other
stock-related awards (collectively, "Awards") granted or to be granted under the
Company's 1996 Executive Incentive Compensation Plan (the "Plan"). We have acted
as counsel to the Company in connection with the preparation and filing of the
Registration Statement.
<PAGE>
Sunglass Hut International, Inc.
January 21, 1997
Page 2
- -------------------------
In connection therewith, we have examined and relied upon the original
or a copy, certified to our satisfaction, of (i) the Articles of Incorporation
and Bylaws of the Company; (ii) records of corporate proceedings of the Company
authorizing the Plan and related matters; (iii) the Registration Statement and
exhibits thereto; and (iv) such other documents and instruments as we have
deemed necessary for the expression of the opinions herein contained. In making
the foregoing 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 certified
or photostatic copies. As to various questions of fact material to this opinion,
we have relied, to the extent we deem reasonably appropriate, upon
representations or certificates of officers or directors of the Company and upon
documents, records and instruments furnished to us by the Company, without
independently checking or verifying the accuracy of such documents, records and
instruments.
Based upon the foregoing examination, we are of the opinion that the
Company presently has available at least 6,000,000 shares of authorized and
unissued Common Stock from which the 6,000,000 shares of Common Stock may be
issued pursuant to Awards granted under the Plan. In addition, assuming that the
Company maintains an adequate number of authorized but unissued shares of Common
Stock available for issuance pursuant to Awards, and assuming that the Company's
consideration for shares issued pursuant to Awards is actually received by the
Company in accordance with the Plan and Section 607.0621 of the Florida Business
Corporation Act, we are of the opinion that the shares of Common Stock issued
pursuant to the Awards granted under and in accordance with the terms of the
Plan will be duly and validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent, we do not admit that we come
within the category of persons whose consent is required by Section 7 of the Act
or the rules and regulations of the Commission thereunder.
Sincerely,
GREENBERG, TRAURIG, HOFFMAN,
LIPOFF, ROSEN & QUENTEL, P.A.
/s/GREENBERG, TRAURIG, HOFFMAN,
LIPOFF, ROSEN & QUENTEL, P.A.
___________________________________
EXHIBIT 10.1
SUNGLASS HUT INTERNATIONAL, INC.
1996 EXECUTIVE INCENTIVE COMPENSATION PLAN
1. PURPOSE. The purpose of this 1996 Executive Incentive Compensation
Plan (the "Plan") is to assist Sunglass Hut International, Inc. (the "Company")
and its subsidiaries in attracting, motivating, retaining and rewarding
high-quality executives and other employees, officers, Directors and independent
contractors enabling such persons to acquire or increase a proprietary interest
in the Company in order to strengthen the mutuality of interests between such
persons and the Company's stockholders, and providing such persons with annual
and long term performance incentives to expend their maximum efforts in the
creation of shareholder value. The Plan is also intended to qualify certain
compensation awarded under the Plan for tax deductibility under Section 162(m)
of the Code (as hereafter defined) to the extent deemed appropriate by the
Committee (or any successor committee) of the Board of Directors of the Company.
2. DEFINITIONS. For purposes of the Plan, the following terms shall
be defined as set forth below, in addition to such terms defined in Section 1
hereof.
(a) "Annual Incentive Award" means a conditional right granted to
a Participant under Section 8(c) hereof to receive a cash payment, Stock
or other Award, unless otherwise determined by the Committee, after the
end of a specified fiscal year.
(b) "Award" means any Option, SAR (including Limited SAR),
Restricted Stock, Deferred Stock, Stock granted as a bonus or in lieu of
another award, Dividend Equivalent, Other Stock-Based Award, Performance
Award or Annual Incentive Award, together with any other right or
interest granted to a Participant under the Plan.
(c) "Beneficiary" means the person, persons, trust or trusts
which have been designated by a Participant in his or her most recent
written beneficiary designation filed with the Committee to receive the
benefits specified under the Plan upon such Participant's death or to
which Awards or other rights are transferred if and to the extent
permitted under Section 10(b) hereof. If, upon a Participant's death,
there is no designated Beneficiary or surviving designated Beneficiary,
then the term Beneficiary means person, persons, trust or trusts
entitled by will or the laws of descent and distribution to receive such
benefits.
(d) "Beneficial Owner," "Beneficially Owning" and "Beneficial
Ownership" shall have the meanings ascribed to such terms in Rule 13d-3
under the Exchange Act and any successor to such Rule.
(e) "Board" means the Company's Board of Directors.
(f) "Change in Control" means Change in Control as defined with
related terms in Section 9 of the Plan.
(g) "Change in Control Price" means the amount calculated in
accordance with Section 9(c) of the Plan.
(h) "Code" means the Internal Revenue Code of 1986, as amended
from time to time, including regulations thereunder and successor
provisions and regulations thereto.
(i) "Committee" means a committee designated by the Board to
administer the Plan; provided, however, that the Commmittee shall
consist solely of at least three directors, each of whom shall be (i) a
"disinterested person" within the meaning of Rule 16b-3 under the
Exchange Act, unless administration of the Plan by "disinterested
persons" is not then required in order for exemptions under Rule 16b-3
to apply to transactions under the Plan, and (ii) an "outside director"
as defined under Section
1
<PAGE>
162(m) of the Code, unless administration of the Plan by "outside
directors" is not then required in order to qualify for tax
deductibility under Section 162(m) of the Code.
(j) "Corporate Transaction" means a transaction as defined in
Section 9(b) of the Plan.
(k) "Covered Employee" means an Eligible Person who is a Covered
Employee as specified in Section 8(e) of the Plan.
(l) "Deferred Stock" means a right, granted to a Participant
under Section 6(e) hereof, to receive Stock, cash or a combination
thereof at the end of a specified deferral period.
(m) "Director" means a member of the Board.
(n) "Disability" means a permanent and total disability (within
the meaning of Section 22(e) of the Code), as determined by a medical
doctor satisfactory to the Committee.
(o) "Dividend Equivalent" means a right, granted to a Participant
under Section 6(g) hereof, to receive cash, Stock, other Awards or other
property equal in value to dividends paid with respect to a specified
number of shares of Stock, or other periodic payments.
(p) "Effective Date" means the effective date of the Plan, which
shall be the later of March 31, 1996 or at the close of business on the
date on which the Company issues its earnings release for its fiscal
year ended February 3, 1996.
(q) "Eligible Person" means each executive officer of the Company
(as defined under the Exchange Act) and other officers, Directors and
employees of the Company or of any subsidiary, and independent
contractors with the Company or any subsidiary. The foregoing
notwithstanding, no Non-Employee Director shall be an Eligible Person
for purposes of receiving any Awards under this Plan other than Formula
Grants of Options granted under Section 6(b)(iv) of the Plan and Formula
Grants of Restricted Stock granted under Section 6(d)(v) of the Plan,
and no independent contractor shall be an Eligible Person for purposes
of receiving any Awards other than Options under Section 6(b) of the
Plan. An employee on leave of absence may be considered as still in the
employ of the Company or a subsidiary for purposes of eligibility for
participation in the Plan.
(r) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, including rules thereunder and successor
provisions and rules thereto.
(s) "Executive Officer" means an executive officer of the Company
as defined under the Exchange Act.
(t) "Fair Market Value" means the fair market value of Stock,
Awards or other property as determined by the Committee or under
procedures established by the Committee. Unless otherwise determined by
the Committee, the Fair Market Value of Stock as of any given date shall
be the closing sale price per share reported on a consolidated basis for
stock listed on the principal stock exchange or market on which Stock is
traded on the date as of which such value is being determined or, if
there is no sale on that date, then on the last previous day on which a
sale was reported.
(u) "Formula Grants" means the Formula Grant Options and Formula
Grant Restricted Stock granted to Non-Employee Directors pursuant to
Sections 6(b)(iv) and 6(d)(v) of the Plan.
(v) "Incentive Stock Option" or "ISO" means any Option intended
to be designated as an incentive stock option within the meaning of
Section 422 of the Code or any successor provision thereto.
(w) "Incumbent Board" means the Board as defined in Section 9(b)
of the Plan.
2
<PAGE>
(x) "Limited SAR" means a right granted to a Participant under
Section 6(c) hereof.
(y) "Non-Employee Director" shall mean a member of the Board who
is not an employee of the Company or any subsidiary.
(z) "Option" means a right granted to a Participant under Section
6(b) hereof, to purchase Stock or other Awards at a specified price
during specified time periods.
(aa) "Other Stock-Based Awards" means Awards granted to a
Participant under Section 6(h) hereof.
(ab) "Participant" means a person who has been granted an Award
under the Plan which remains outstanding, including a person who is no
longer an Eligible Person.
(ac) "Performance Award" means a right, granted to a Eligible
Person under Section 8 hereof, to receive Awards based upon performance
criteria specified by the Committee.
(ad) "Person" shall have the meaning ascribed to such term in
Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d)
thereof, and shall include a "group" as defined in Section 13(d)
thereof.
(ae) "Preexisting Plans" means the Company's Amended and Restated
Stock Option Plan (March 1995) and the Company's Management Incentive
Plan.
(af) "Restricted Stock" means Stock granted to a Participant
under Section 6(d) hereof, that is subject to certain restrictions and
to a risk of forfeiture.
(ag) "Retire" or "Retirement" means termination of service as a
Director after having attained at least age 62 and having served as a
Director for at least 5 years, other than by reason of death, Disability
or the Director's willful misconduct or negligence.
(ah) "Rule 16b-3" and "Rule 16a-l(c)(3)" means Rule 16b-3 and
Rule 16a-l(c)(3), as from time to time in effect and applicable to the
Plan and Participants, promulgated by the Securities and Exchange
Commission under Section 16 of the Exchange Act.
(ai) "Stock" means the Company's Common Stock, and such other
securities as may be substituted (or resubstituted) for Stock pursuant
to Section l0(c) hereof.
(aj) "Stock Appreciation Rights" or "SAR" means a right granted
to a Participant under Section 6(c) hereof.
3. ADMINISTRATION.
(a) AUTHORITY OF THE COMMITTEE. The Plan shall be administered
by the Committee. The Committee shall have full and final authority, in
each case subject to and consistent with the provisions of the Plan, to
select Eligible Persons to become Participants, grant Awards, determine
the type, number and other terms and conditions of, and all other
matters relating to, Awards, prescribe Award agreements (which need not
be identical for each Participant) and rules and regulations for the
administration of the Plan, construe and interpret the Plan and Award
agreements and correct defects, supply omissions or reconcile
inconsistencies therein, and to make all other decisions and
determinations as the Committee may deem necessary or advisable for the
administration of the Plan.
(b) MANNER OF EXERCISE OF COMMITTEE AUTHORITY. The Committee
shall exercise sole and exclusive discretion on any matter relating to a
Participant then subject to Section 16 of the Exchange Act
3
<PAGE>
with respect to the Company to the extent necessary in order that
transactions by such Participant shall be exempt under Rule 16b-3 under
the Exchange Act. Any action of the Committee shall be final, conclusive
and binding on all persons, including the Company, its subsidiaries,
Participants, Beneficiaries, transferees under Section l0(b) hereof or
other persons claiming rights from or through a Participant, and
stockholders. The express grant of any specific power to the Committee,
and the taking of any action by the Committee, shall not be construed as
limiting any power or authority of the Committee. The Committee may
delegate to officers or managers of the Company or any subsidiary, or
committees thereof, the authority, subject to such terms as the
Committee shall determine, (i) to perform administrative functions, (ii)
with respect to Participants not subject to Section 16 of the Exchange
Act, to perform such other functions as the Committee may determine, and
(iii) with respect to Participants subject to Section 16, to perform
such other functions of the Committee as the Committee may determine to
the extent performance of such functions will not result in the loss of
an exemption under Rule 16b-3 otherwise available for transactions by
such persons, in each case to the extent permitted under applicable law
and subject to the requirements set forth in Section 8(d). The Committee
may appoint agents to assist it in administering the Plan.
(c) LIMITATION OF LIABILITY. The Committee and each member
thereof shall be entitled to, in good faith, rely or act upon any report
or other information furnished to him or her by any executive officer,
other officer or employee of the Company or a subsidiary, the Company's
independent auditors, consultants or any other agents assisting in the
administration of the Plan. Members of the Committee and any officer or
employee of the Company or a subsidiary acting at the direction or on
behalf of the Committee shall not be personally liable for any action or
determination taken or made in good faith with respect to the Plan, and
shall, to the extent permitted by law, be fully indemnified and
protected by the Company with respect to any such action or
determination.
4. STOCK SUBJECT TO PLAN.
(a) OVERALL NUMBER OF SHARES SUBJECT TO AWARDS. Subject to
adjustment as provided in Section l0(c) hereof, the total number of
shares of Stock that may be subject to the granting of Awards under the
Plan at any point in time during the term of the Plan shall be equal to:
(i) 6,000,000 shares, plus (ii) 10% of the number of shares newly issued
by the Company or delivered out of treasury shares during the term of
the Plan (including any issuance or delivery in connection with Awards,
awards under the Preexisting Plans, or any other compensation or benefit
plan of the Company), minus (iii) 10% of the number of shares that are
purchased or redeemed by the Company during the term of the Plan, minus
(iv) the number of shares that then are subject to outstanding Awards or
awards under the Preexisting Plans. For purposes of determining under
clause (iv) the number of shares that are subject to outstanding awards
under the Preexisting Plans, there shall be disregarded any options
granted to management under the Preexisting Plans in connection with the
Company's July 1991 recapitalization. Any shares of Stock delivered
under the Plan may consist, in whole or in part, of authorized and
unissued shares or treasury shares. In no event shall the aggregate
number of shares of stock which may be issued pursuant to ISOs exceed
1,000,000 shares.
(b) APPLICATION OF LIMITATIONS. The limitation contained in
Section 4(a) shall apply not only to Awards that are settleable by the
delivery of shares of stock but also to Awards relating to shares of
Stock but settleable only in cash (such as cash-only SARs). The
Committee may adopt reasonable counting procedures to ensure appropriate
counting, avoid double counting (as, for example, in the case of tandem
or substitute awards) and make adjustments if the number of shares of
Stock actually delivered differs from the number of shares previously
counted in connection with an Award.
5. ELIGIBILITY; PER-PERSON AWARD LIMITATIONS. Awards may be granted
under the Plan only to Eligible Persons. In each fiscal year during any part of
which the Plan is in effect, an Eligible Person may not be granted Awards
relating to more than 250,000 shares of Stock, subject to adjustment as provided
in Section l0(c), under each of Sections 6(b), 6(c), 6(d), 6(e), 6(f), 6(g),
6(h), 8(b) and 8(c). In addition, the maximum amount that may be earned as a
final Annual Incentive Award or other cash Award in any fiscal year by any one
Participant
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shall be $1,000,000, and the maximum amount that may be earned as a final
Performance Award or other cash Award in respect of a performance period by any
one Participant shall be $5,000,000.
6. SPECIFIC TERMS OF AWARDS.
(a) GENERAL. Awards may be granted on the terms and conditions
set forth in this Section 6. In addition, the Committee may impose on
any Award or the exercise thereof, at the date of grant or thereafter
(subject to Section 10(e)), such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee shall
determine, including terms requiring forfeiture of Awards in the event
of termination of employment by the Participant and terms permitting a
Participant to make elections relating to his or her Award. The
Committee shall retain full power and discretion to accelerate, waive or
modify, at any time, any term or condition of an Award that is not
mandatory under the Plan. Except in cases in which the Committee is
authorized to require other forms of consideration under the Plan, or to
the extent other forms of consideration must be paid to satisfy the
requirements of Florida law, no consideration other than services may be
required for the grant (but not the exercise) of any Award.
(b) OPTIONS. The Committee is authorized to grant Options to
Participants on the following terms and conditions:
(i) EXERCISE PRICE. The exercise price per share of Stock
purchasable under an Option shall be determined by the Committee,
provided that such exercise price shall not be less than the Fair
Market Value of a share of Stock on the date of grant of such
Option except as provided under Section 7(a) hereof.
(ii) TIME AND METHOD OF EXERCISE. The Committee shall
determine the time or times at which or the circumstances under
which an Option may be exercised in whole or in part (including
based on achievement of performance goals and/or future service
requirements), the time or times at which Options shall cease to
be or become exercisable following termination of employment or
upon other conditions, the methods by which such exercise price
may be paid or deemed to be paid, the form of such payment,
including, without limitation, cash, Stock, other Awards or
awards granted under other plans of the Company or any
subsidiary, or other property (including notes or other
contractual obligations of Participants to make payment on a
deferred basis), and the methods by or forms in which Stock will
be delivered or deemed to be delivered to Participants.
(iii) ISOS. The terms of any ISO granted under the Plan
shall comply in all respects with the provisions of Section 422
of the Code. Anything in the Plan to the contrary
notwithstanding, no term of the Plan relating to ISOs (including
any SAR in tandem therewith) shall be interpreted, amended or
altered, nor shall any discretion or authority granted under the
Plan be exercised, so as to disqualify either the Plan or any ISO
under Section 422 of the Code, unless the Participant has first
requested the change that will result in such disqualification.
(iv) FORMULA GRANTS OF OPTIONS TO NON-EMPLOYEE DIRECTORS.
Subject to adjustment as provided in the first sentence of
Section 10(c) hereof, each Non-Employee Director shall receive
(A) on the date of his or her appointment as a Director of the
Company, an Option to purchase 40,000 shares of Stock, and (B)
each year, on the day the Company issues its earnings release for
the prior fiscal year, an Option to purchase 6,000 shares of
Stock. Options granted to Non-Employee Directors pursuant to this
Section shall be for a term of 10 years and shall become
exercisable at the rate of 33 1/3% per year commencing on the
first anniversary of the date on which the Option is granted;
provided, however, that the Options shall be fully exercisable in
the event that, while serving as a Director, the Non-Employee
Director dies, suffers a Disability, or Retires. The per share
exercise price of all Options granted to Non-Employee Directors
pursuant to this paragraph (iv) shall be equal to the Fair Market
Value of a share of Stock on the date such Option is granted.
Unless otherwise extended in the sole of the discretion of the
Committee, the
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unexercised portion of any Option granted pursuant to this paragraph
(iv) shall become null and void (V) three months after the date on which
such Non-Employee Director ceases to be a Director of the Company for
any reason other than the Non-Employee Director's willful misconduct or
negligence, Disability, death or Retirement, (W) immediately in the
event of the Non-Employee Director's willful misconduct or negligence,
(X) one year after the Non-Employee Director ceases to be a Director by
reason of his Disability, (Y) at the expiration of its original term, if
the Non-Employee Director ceases to be a Director by reason of his
Retirement, and (Z) twelve months after the date of the Non-Employee
Director's death in the event that such death occurs prior to the time
the Option otherwise would become null and void pursuant to this
sentence.
(c) STOCK APPRECIATION RIGHTS. The Committee is authorized to
grant SARs to Participants on the following terms and conditions:
(i) RIGHT TO PAYMENT. A SAR shall confer on the
Participant to whom it is granted a right to receive, upon
exercise thereof, the excess of (A) the Fair Market Value of one
share of stock on the date of exercise (or, in the case of a
"Limited SAR," the Fair Market Value determined by reference to
the Change in Control Price, as defined under Section 9(c)
hereof), over (B) the grant price of the SAR as determined by the
Committee. The grant price of an SAR shall not be less than the
Fair Market Value of a share of Stock on the date of grant except
as provided under Section 7(a) hereof.
(ii) OTHER TERMS. The Committee shall determine at the
date of grant or thereafter, the time or times at which and the
circumstances under which a SAR may be exercised in whole or in
part (including based on achievement of performance goals and/or
future service requirements), the time or times at which SARs
shall cease to be or become exercisable following termination of
employment or upon other conditions, the method of exercise,
method of settlement, form of consideration payable in
settlement, method by or forms in which Stock will be delivered
or deemed to be delivered to Participants, whether or not a SAR
shall be in tandem or in combination with any other Award, and
any other terms and conditions of any SAR. Limited SARs that may
only be exercised in connection with a Change in Control or other
event as specified by the Committee may be granted on such terms,
not inconsistent with this Section 6(c), as the Committee may
determine. SARs and Limited SARs may be either freestanding or in
tandem with other Awards.
(d) RESTRICTED STOCK. The Committee is authorized to grant
Restricted Stock to Participants on the following terms and conditions:
(i) GRANT AND RESTRICTIONS. Restricted Stock shall be
subject to such restrictions on transferability, risk of
forfeiture and other restrictions, if any, as the Committee may
impose, which restrictions may lapse separately or in combination
at such times, under such circumstances (including based on
achievement of performance goals and/or future service
requirements), in such installments or otherwise, as the
Committee may determine at the date of grant or thereafter. In no
event shall the restricted period be less than three years unless
the Restricted Stock is subject to performance conditions in
accordance with Section 8 of this Plan, in which case the
restricted period shall not be less than one year. Except to the
extent restricted under the terms of the Plan and any Award
agreement relating to the Restricted Stock, a Participant granted
Restricted Stock shall have all of the rights of a stockholder,
including the right to vote the Restricted Stock and the right to
receive dividends thereon (subject to any mandatory reinvestment
or other requirement imposed by the Committee). During the
restricted period applicable to the Restricted Stock, subject to
Section 10(b) below, the Restricted Stock may not be sold,
transferred, pledged, hypothecated, margined or otherwise
encumbered by the Participant.
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(ii) FORFEITURE. Except as otherwise determined by the
Committee at the time of the Award, upon termination of a
Participant's employment during the applicable restriction
period, the Participant's Restricted Stock that is at that time
subject to restrictions shall be forfeited and reaquired by the
Company; provided that the Committee may provide, by rule or
regulation or in any Award agreement, or may determine in any
individual case, that restrictions or forfeiture conditions
relating to Restricted Stock shall be waived in whole or in part
in the event of terminations resulting from specified causes.
(iii) CERTIFICATES FOR STOCK. Restricted Stock granted
under the Plan may be evidenced in such manner as the Committee
shall determine. If certificates representing Restricted Stock
are registered in the name of the Participant, the Committee may
require that such certificates bear an appropriate legend
referring to the terms, conditions and restrictions applicable to
such Restricted Stock, that the Company retain physical
possession of the certificates, and that the Participant deliver
a stock power to the Company, endorsed in blank, relating to the
Restricted Stock.
(iv) DIVIDENDS AND SPLITS. As a condition to the grant of
an Award of Restricted Stock, the Committee may require that any
cash dividends paid on a share of Restricted Stock be
automatically reinvested in additional shares of Restricted Stock
or applied to the purchase of additional Awards under the Plan.
Unless otherwise determined by the Committee, Stock distributed
in connection with a Stock split or Stock dividend, and other
property distributed as a dividend, shall be subject to
restrictions and a risk of forfeiture to the same extent as the
Restricted Stock with respect to which such Stock or other
property has been distributed.
(v) FORMULA GRANTS OF RESTRICTED STOCK TO NON-EMPLOYEE
DIRECTORS. Subject to adjustment as provided in the first
sentence of Section 10(c) hereof, commencing at the end of the
Company's fiscal year that begins February 4, 1996, each
Non-Employee Director shall receive each year, on the day the
Company issues its earnings release for the prior fiscal year, an
Award of 1,500 shares of Restricted Stock. Each Award of
Restricted Stock shall become non-forfeitable on the third
anniversary of the date on which the Restricted Stock is granted;
provided, however, that all Restricted Stock granted to a
Non-Employee Director shall become nonforfeitable in the event
that, while serving as a Director, the Non-Employee Director
dies, suffers a Disability, or Retires. In the event that a
Non-Employee Director ceases to serve as a Director for any
reason other than the death, Disability or Retirement of the
Non-Employee Director, the Restricted Stock that is at that time
subject to restrictions shall be forfeited and reaquired by the
Company.
(e) DEFERRED STOCK. The Committee is authorized to grant Deferred
Stock to Participants, which are rights to receive Stock, cash, or a
combination thereof at the end of a specified deferral period, subject
to the following terms and conditions:
(i) AWARD AND RESTRICTIONS. Satisfaction of an Award of
Deferred Stock shall occur upon expiration of the deferral period
specified for such Deferred Stock by the Committee (or, if
permitted by the Committee, as elected by the Participant). In
addition, Deferred Stock shall be subject to such restrictions
(which may include a risk of forfeiture) as the Committee may
impose, if any, which restrictions may lapse at the expiration of
the deferral period or at earlier specified times (including
based on achievement of performance goals and/or future service
requirements), separately or in combination, in installments or
otherwise, as the Committee may determine. In no event shall an
Award of Deferral Stock payable in Stock have a deferral period
of less than three years unless the Award is subject to
performance conditions in accordance with Section 8 of the Plan,
in which case the deferral period shall be for not less than one
year. Deferred Stock may be satisfied by delivery of Stock, cash
equal to the Fair Market Value of the specified number of shares
of Stock covered by the Deferred Stock, or a combination thereof,
as determined by the Committee at the date of grant or
thereafter. Prior to satisfaction of
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an Award of Deferred Stock, an Award of Deferred Stock carries no
voting or dividend or other rights associated with share
ownership.
(ii) FORFEITURE. Except as otherwise determined by the
Committee, upon termination of a Participant's employment during
the applicable deferral period thereof to which forfeiture
conditions apply (as provided in the Award agreement evidencing
the Deferred Stock), the Participant's Deferred Stock that is at
that time subject to deferral (other than a deferral at the
election of the Participant) shall be forfeited; provided that
the Committee may provide, by rule or regulation or in any Award
agreement, or may determine in any individual case, that
restrictions or forfeiture conditions relating to Deferred Stock
shall be waived in whole or in part in the event of terminations
resulting from specified causes, and the Committee may in other
cases waive in whole or in part the forfeiture of Deferred Stock.
(iii) DIVIDEND EQUIVALENTS. Unless otherwise determined by
the Committee at date of grant, Dividend Equivalents on the
specified number of shares of Stock covered by an Award of
Deferred Stock shall be either (A) paid with respect to such
Deferred Stock at the dividend payment date in cash or in shares
of unrestricted Stock having a Fair Market Value equal to the
amount of such dividends, or (B) deferred with respect to such
Deferred Stock and the amount or value thereof automatically
deemed reinvested in additional Deferred Stock, other Awards or
other investment vehicles, as the Committee shall determine or
permit the Participant to elect.
(f) BONUS STOCK AND AWARDS IN LIEU OF OBLIGATIONS. The Committee
is authorized to grant Stock as a bonus, or to grant Stock or other
Awards in lieu of Company obligations to pay cash or deliver other
property under the Plan or under other plans or compensatory
arrangements, provided that, in the case of Participants subject to
Section 16 of the Exchange Act, the amount of such grants remains within
the discretion of the Committee to the extent necessary to ensure that
acquisitions of Stock or other Awards are exempt from liability under
Section 16(b) of the Exchange Act. Stock or Awards granted hereunder
shall be subject to such other terms as shall be determined by the
Committee.
(g) DIVIDEND EQUIVALENTS. The Committee is authorized to grant
Dividend Equivalents to a Participant entitling the Participant to
receive cash, Stock, other Awards, or other property equal in value to
dividends paid with respect to a specified number of shares of Stock, or
other periodic payments. Dividend Equivalents may be awarded on a
free-standing basis or in connection with another Award. The Committee
may provide that Dividend Equivalents shall be paid or distributed when
accrued or shall be deemed to have been reinvested in additional Stock,
Awards, or other investment vehicles, and subject to such restrictions
on transferability and risks of forfeiture, as the Committee may
specify.
(h) OTHER STOCK-BASED AWARDS. The Committee is authorized,
subject to limitations under applicable law, to grant to Participants
such other Awards that may be denominated or payable in, valued in whole
or in part by reference to, or otherwise based on, or related to, Stock,
as deemed by the Committee to be consistent with the purposes of the
Plan, including, without limitation, convertible or exchangeable debt
securities, other rights convertible or exchangeable into Stock,
purchase rights for Stock, Awards with value and payment contingent upon
performance of the Company or any other factors designated by the
Committee, and Awards valued by reference to the book value of Stock or
the value of securities of or the performance of specified subsidiaries
or business units. The Committee shall determine the terms and
conditions of such Awards. Stock delivered pursuant to an Award in the
nature of a purchase right granted under this Section 6(h) shall be
purchased for such consideration, paid for at such times, by such
methods, and in such forms, including, without limitation, cash, Stock,
other Awards or other property, as the Committee shall determine. Cash
awards, as an element of or supplement to any other Award under the
Plan, may also be granted pursuant to this Section 6(h).
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7. CERTAIN PROVISIONS APPLICABLE TO AWARDS.
(a) STAND-ALONE, ADDITIONAL, TANDEM, AND SUBSTITUTE AWARDS.
Awards granted under the Plan may, in the discretion of the Committee,
be granted either alone or in addition to, in tandem with, or in
substitution or exchange for, any other Award or any award granted under
another plan of the Company, any subsidiary, or any business entity to
be acquired by the Company or a subsidiary, or any other right of a
Participant to receive payment from the Company or any subsidiary. Such
additional, tandem, and substitute or exchange Awards may be granted at
any time. If an Award is granted in substitution or exchange for another
Award or award, the Committee shall require the surrender of such other
Award or award in consideration for the grant of the new Award. In
addition, Awards may be granted in lieu of cash compensation, including
in lieu of cash amounts payable under other plans of the Company or any
subsidiary, in which the value of Stock subject to the Award is
equivalent in value to the cash compensation (for example, Deferred
Stock or Restricted Stock), or in which the exercise price, grant price
or purchase price of the Award in the nature of a right that may be
exercised is equal to the Fair Market Value of the underlying Stock
minus the value of the cash compensation surrendered (for example,
Options granted with an exercise price "discounted" by the amount of the
cash compensation surrendered).
(b) TERM OF AWARDS. The term of each Award shall be for such
period as may be determined by the Committee; provided that in no event
shall the term of any Option or SAR exceed a period of ten years (or
such shorter term as may be required in respect of an ISO under Section
422 of the Code).
(c) FORM AND TIMING OF PAYMENT UNDER AWARDS; DEFERRALS. Subject
to the terms of the Plan and any applicable Award agreement, payments to
be made by the Company or a subsidiary upon the exercise of an Option or
other Award or settlement of an Award may be made in such forms as the
Committee shall determine, including, without limitation, cash, Stock,
other Awards or other property, and may be made in a single payment or
transfer, in installments, or on a deferred basis. The settlement of any
Award may be accelerated, and cash paid in lieu of Stock in connection
with such settlement, in the discretion of the Committee or upon
occurrence of one or more specified events (in addition to a Change in
Control). Installment or deferred payments may be required by the
Committee (subject to Section 10(e) of the Plan) or permitted at the
election of the Participant on terms and conditions established by the
Committee. Payments may include, without limitation, provisions for the
payment or crediting of a reasonable interest rate on installment or
deferred payments or the grant or crediting of Dividend Equivalents or
other amounts in respect of installment or deferred payments denominated
in Stock.
(d) EXEMPTIONS FROM SECTION 16(B) LIABILITY. It is the intent of
the Company that this Plan comply in all respects with applicable
provisions of Rule 16b-3 or Rule 16a-1(c)(3) to the extent necessary to
ensure that neither the grant of any Awards to nor other transaction by
a Participant who is subject to Section 16 of the Exchange Act is
subject to liability under Section 16(b) thereof (except for
transactions acknowledged in writing to be non-exempt by such
Participant). Accordingly, if any provision of this Plan or any Award
agreement does not comply with the requirements of Rule 16b-3 or Rule
16a-1(c)(3) as then applicable to any such transaction, such provision
will be construed or deemed amended to the extent necessary to conform
to the applicable requirements of Rule 16b-3 or Rule 16a-1(c)(3) so that
such Participant shall avoid liability under Section 16(b). In addition,
the purchase price of any Award conferring a right to purchase Stock
shall be not less than any specified percentage of the Fair Market Value
of Stock at the date of grant of the Award then required in order to
comply with Rule 16b-3.
8. PERFORMANCE AND ANNUAL INCENTIVE AWARDS.
(a) PERFORMANCE CONDITIONS. The right of a Participant to
exercise or receive a grant or settlement of any Award, and the timing
thereof, may be subject to such performance conditions as may be
specified by the Committee. The Committee may use such business criteria
and other measures of performance as it may deem appropriate in
establishing any performance conditions, and may exercise its discretion
to reduce the amounts payable under any Award subject to performance
conditions, except as
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limited under Sections 8(b) and 8(c) hereof in the case of a Performance
Award or Annual Incentive Award intended to qualify under Code Section
162(m).
(b) PERFORMANCE AWARDS GRANTED TO DESIGNATED COVERED EMPLOYEES.
If and to the extent that the Committee determines that a Performance
Award to be granted to an Eligible Person who is designated by the
Committee as likely to be a Covered Employee should qualify as
"performance-based compensation" for purposes of Code Section 162(m),
the grant, exercise and/or settlement of such Performance Award shall be
contingent upon achievement of preestablished performance goals and
other terms set forth in this Section 8(b).
(i) PERFORMANCE GOALS GENERALLY. The performance goals for
such Performance Awards shall consist of one or more business
criteria and a targeted level or levels of performance with
respect to each of such criteria, as specified by the Committee
consistent with this Section 8(b). Performance goals shall be
objective and shall otherwise meet the requirements of Code
Section 162(m) and regulations thereunder including the
requirement that the level or levels of performance targeted by
the Committee result in the achievement of performance goals
being "substantially uncertain." The Committee may determine that
such Performance Awards shall be granted, exercised and/or
settled upon achievement of any one performance goal or that two
or more of the performance goals must be achieved as a condition
to grant, exercise and/or settlement of such Performance Awards.
Performance goals may differ for Performance Awards granted to
any one Participant or to different Participants.
(ii) BUSINESS CRITERIA. One or more of the following
business criteria for the Company, on a consolidated basis,
and/or specified subsidiaries or business units of the Company
(except with respect to the total stockholder return and earnings
per share criteria), shall be used exclusively by the Committee
in establishing performance goals for such Performance Awards:
(1) total stockholder return; (2) such total stockholder return
as compared to total return (on a comparable basis) of a publicly
available index such as, but not limited to, the Standard &
Poor's 500 Stock Index or the S&P Specialty Retailer Index; (3)
net income; (4) pretax earnings; (5) earnings before interest
expense, taxes, depreciation and amortization; (6) pretax
operating earnings after interest expense and before bonuses,
service fees, and extraordinary or special items; (7) operating
margin; (8) earnings per share; (9) growth in earnings per share;
(10) return on equity; (11) return on capital; (12) return on
investment; (13) operating earnings; (14) working capital or
inventory; and (15) ratio of debt to stockholders' equity. One or
more of the foregoing business criteria shall also be exclusively
used in establishing performance goals for Annual Incentive
Awards granted to a Covered Employee under Section 8(c) hereof.
(iii) PERFORMANCE PERIOD; TIMING FOR ESTABLISHING
PERFORMANCE Goals. Achievement of performance goals in respect of
such Performance Awards shall be measured over a performance
period of up to ten years, as specified by the Committee.
Performance goals shall be established not later than 90 days
after the beginning of any performance period applicable to such
Performance Awards, or at such other date as may be required or
permitted for "performance-based compensation" under Code Section
162(m).
(iv) PERFORMANCE AWARD POOL. The Committee may establish a
Performance Award pool, which shall be an unfunded pool, for
purposes of measuring Company performance in connection with
Performance Awards. The amount of such Performance Award pool
shall be based upon the achievement of a performance goal or
goals based on one or more of the business criteria set forth in
Section 8(b)(ii) hereof during the given performance period, as
specified by the Committee in accordance with Section 8(b)(iii)
hereof. The Committee may specify the amount of the Performance
Award Pool as a percentage of any of such business criteria, a
percentage thereof in excess of a threshold amount, or as another
amount which need not bear a strictly mathematical relationship
to such business criteria.
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(v) SETTLEMENT OF PERFORMANCE AWARDS; OTHER TERMS.
Settlement of such Performance Awards shall be in cash, Stock,
other Awards or other property, in the discretion of the
Committee. The Committee may, in its discretion, reduce the
amount of a settlement otherwise to be made in connection with
such Performance Awards. The Committee shall specify the
circumstances in which such Performance Awards shall be paid or
forfeited in the event of termination of employment by the
Participant prior to the end of a performance period or
settlement of Performance Awards.
(c) ANNUAL INCENTIVE AWARDS GRANTED TO DESIGNATED COVERED
EMPLOYEES. If and to the extent that the Committee determines that an
Annual Incentive Award to be granted to an Eligible Person who is
designated by the Committee as likely to be a Covered Employee should
qualify as "performance-based compensation" for purposes of Code Section
162(m), the grant, exercise and/or settlement of such Annual Incentive
Award shall be contingent upon achievement of preestablished performance
goals and other terms set forth in this Section 8(c).
(i) ANNUAL INCENTIVE AWARD POOL. The Committee may
establish an Annual Incentive Award pool, which shall be an
unfunded pool, for purposes of measuring Company performance in
connection with Annual Incentive Awards. The amount of such
Annual Incentive Award pool shall be based upon the achievement
of a performance goal or goals based on one or more of the
business criteria set forth in Section 8(b)(ii) hereof during the
given performance period, as specified by the Committee in
accordance with Section 8(b)(iii) hereof. The Committee may
specify the amount of the Annual Incentive Award pool as a
percentage of any such business criteria, a percentage thereof in
excess of a threshold amount, or as another amount which need not
bear a strictly mathematical relationship to such business
criteria.
(ii) POTENTIAL ANNUAL INCENTIVE AWARDS. Not later than the
end of the 90th day of each fiscal year, or at such other date as
may be required or permitted in the case of Awards intended to be
"performance-based compensation" under Code Section 162(m), the
Committee shall determine the Eligible Persons who will
potentially receive Annual Incentive Awards, and the amounts
potentially payable thereunder, for that fiscal year, either out
of an Annual Incentive Award pool established by such date under
Section 8(c)(i) hereof or as individual Annual Incentive Awards.
In the case of individual Annual Incentive Awards intended to
qualify under Code Section 162(m), the amount potentially payable
shall be based upon the achievement of a performance goal or
goals based on one or more of the business criteria set forth in
Section 8(b)(ii) hereof in the given performance year, as
specified by the Committee; in other cases, such amount shall be
based on such criteria as shall be established by the Committee.
In all cases, the maximum Annual Incentive Award of any
Participant shall be subject to the limitation set forth in
Section 5 hereof.
(iii) PAYOUT OF ANNUAL INCENTIVE AWARDS. After the end of
each fiscal year, the Committee shall determine the amount, if
any, of (A) the Annual Incentive Award pool, and the maximum
amount of potential Annual Incentive Award payable to each
Participant in the Annual Incentive Award pool, or (B) the amount
of potential Annual Incentive Award otherwise payable to each
Participant. The Committee may, in its discretion, determine that
the amount payable to any Participant as a final Annual Incentive
Award shall be reduced from the amount of his or her potential
Annual Incentive Award, including a determination to make no
final Award whatsoever. The Committee shall specify the
circumstances in which an Annual Incentive Award shall be paid or
forfeited in the event of termination of employment by the
Participant prior to the end of a fiscal year or settlement of
such Annual Incentive Award.
(d) WRITTEN DETERMINATIONS. All determinations by the Committee
as to the establishment of performance goals, the amount of any
Performance Award pool or potential individual Performance Awards and as
to the achievement of performance goals relating to Performance Awards
under Section 8(b), and the amount of any Annual Incentive Award pool or
potential individual Annual Incentive
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Awards and the amount of final Annual Incentive Awards under Section
8(c), shall be made in writing in the case of any Award intended to
qualify under Code Section 162(m). The Committee may not delegate any
responsibility relating to such Performance Awards or Annual Incentive
Awards.
(e) STATUS OF SECTION 8(B) AND SECTION 8(C) AWARDS UNDER CODE
SECTION 162(M). It is the intent of the Company that Performance Awards
and Annual Incentive Awards under Section 8(b) and 8(c) hereof granted
to persons who are designated by the Committee as likely to be Covered
Employees within the meaning of Code Section 162(m) and regulations
thereunder shall, if so designated by the Committee, constitute
"qualified performance-based compensation" within the meaning of Code
Section 162(m) and regulations thereunder. Accordingly, the terms of
Sections 8(b), (c), (d) and (e), including the definitions of Covered
Employee and other terms used therein, shall be interpreted in a manner
consistent with Code Section 162(m) and regulations thereunder. The
foregoing notwithstanding, because the Committee cannot determine with
certainty whether a given Participant will be a Covered Employee with
respect to a fiscal year that has not yet been completed, the term
Covered Employee as used herein shall mean only a person designated by
the Committee, at the time of grant of Performance Awards or an Annual
Incentive Award, as likely to be a Covered Employee with respect to that
fiscal year. If any provision of the Plan or any agreement relating to
such Performance Awards or Annual Incentive Awards does not comply or is
inconsistent with the requirements of Code Section 162(m) or regulations
thereunder, such provision shall be construed or deemed amended to the
extent necessary to conform to such requirements.
9. CHANGE IN CONTROL.
(a) EFFECT OF "CHANGE IN CONTROL." In the event of a "Change in
Control," as defined in Section 9(b), the following provisions shall
apply:
(i) Any Award carrying a right to exercise that was not
previously exercisable and vested shall become fully exercisable
and vested as of the time of the Change in Control and shall
remain exercisable and vested for the balance of the stated term
of such Award without regard to any termination of employment by
the Participant, subject only to applicable restrictions set
forth in Section 10(a) hereof;
(ii) Any optionee who holds an Option shall be entitled to
elect, during the 60-day period immediately following a Change in
Control, in lieu of acquiring the shares of Stock covered by such
Option, to receive, and the Company shall be obligated to pay, in
cash the excess of the Change in Control Price over the exercise
price of such Option, multiplied by the number of shares of Stock
covered by such Option; provided, however, that no optionee who
is subject to Section 16 with respect to the Company at the time
of the Change in Control shall be entitled to make such an
election if the acquisition of the right to make such election
would represent a non-exempt purchase under Section 16(b) by such
optionee;
(iii) Limited SARs (and other SARs if so provided by their
terms) shall become exercisable for amounts, in cash, determined
by reference to the Change in Control Price;
(iv) The restrictions, deferral of settlement, and
forfeiture conditions applicable to any other Award granted under
the Plan shall lapse and such Awards shall be deemed fully vested
as of the time of the Change in Control, except to the extent of
any waiver by the Participant and subject to applicable
restrictions set forth in Section 10(a) hereof; and
(v) With respect to any such outstanding Award subject to
achievement of performance goals and conditions under the Plan,
such performance goals and other conditions will be deemed to be
met if and to the extent so provided by the Committee in the
Award agreement relating to such Award.
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(b) DEFINITION OF "CHANGE IN CONTROL." A "Change in Control"
shall be deemed to have occurred upon:
(i) An acquisition by any Person of Beneficial Ownership
of the shares of Common Stock of the Company then outstanding
(the "Company Common Stock Outstanding") or the voting securities
of the Company then outstanding entitled to vote generally in the
election of directors (the "Company Voting Securities
Outstanding") if such acquisition of Beneficial Ownership results
in the Person's Beneficially Owning 25% or more of the Company
Common Stock outstanding or 25% or more of the combined voting
power of the Company Voting Securities Outstanding; or
(ii) The approval by the stockholders of the Company of a
reorganization, merger, consolidation, complete liquidation or
dissolution of the Company, sale or disposition of all or
substantially all of the assets of the Company, or similar
corporate transaction (in each case referred to in this Section
9(b) as a "Corporate Transaction") or, if consummation of such
Corporate Transaction is subject, at the time of such approval by
stockholders, to the consent of any government or governmental
agency, the obtaining of such consent (either explicitly or
implicitly); provided, however, that any merger, consolidation,
sale, disposition or other similar transaction to or with one or
more Participants or entities controlled by one or more
Participants shall not constitute a Corporate Transaction in
respect of such Participant(s); or
(iii) A change in the composition of the Board such that
the individuals who, as of the Effective Date, constitute the
Board (such Board shall be hereinafter referred to as the
"Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, for purposes of this
Section 9(b), that any individual who becomes a member of the
Board subsequent to the Effective Date whose election, or
nomination for election by the Company's stockholders, was
approved by a vote of at least a majority of those individuals
who are members of the Board and who were also members of the
Incumbent Board (or deemed to be such pursuant to this provision)
shall be considered as though such individual were a member of
the Incumbent Board; and, provided, further, that any such
individual whose initial assumption of office occurs as a result
of either an actual or threatened election contest subject to
Rule 14a-11 of Regulation 14A under the Exchange Act, including
any successor to such Rule, or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board shall in no event be considered as a member
of the Incumbent Board.
Notwithstanding the provisions set forth in subparagraphs (i) and (ii)
of this Section 9(b), the following shall not constitute a Change in Control for
purposes of the Plan: (1) any acquisition by or consummation of a Corporate
Transaction with any entity that was a subsidiary of the Company immediately
prior to the transaction or an employee benefit plan (or related trust)
sponsored or maintained by the Company or an entity that was a subsidiary of the
Company immediately prior to the transaction if, immediately after such
transaction (including consummation of all related transactions), the surviving
entity is controlled by no Person other than such subsidiary, employee benefit
plan (or related trust) and/or other Persons who controlled the Company
immediately prior to such transaction; or (2) any acquisition or consummation of
a Corporate Transaction following which more than 50% of, respectively, the
shares then outstanding of common stock of the corporation resulting from such
acquisition or Corporate Transaction and the combined voting power of the voting
securities then outstanding of such corporation entitled to vote generally in
the election of directors is then Beneficially Owned, directly or indirectly, by
all or substantially all of the individuals and entities who were Beneficial
Owners, respectively, of the Company Common Stock Outstanding and Company Voting
Securities Outstanding immediately prior to such acquisition or Corporate
Transaction in substantially the same proportions as their ownership,
immediately prior to such acquisition or Corporate Transaction, of the Company
Common Stock Outstanding and Company Voting Securities Outstanding, as the case
may be.
(c) DEFINITION OF "CHANGE IN CONTROL PRICE." The "Change in
Control Price" means an amount in cash equal to the higher of (i) the
amount of cash and fair market value of property that is the
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highest price per share paid (including extraordinary dividends) in any
Corporate Transaction triggering the Change in Control under Section
9(b)(ii) hereof or any liquidation of shares following a sale of
substantially all assets of the Company, or (ii) the highest Fair Market
Value per share at any time during the 60-day period preceding and
60-day period following the Change in Control.
10. GENERAL PROVISIONS.
(a) COMPLIANCE WITH LEGAL AND OTHER REQUIREMENTS. The Company
may, to the extent deemed necessary or advisable by the Committee,
postpone the issuance or delivery of Stock or payment of other benefits
under any Award until completion of such registration or qualification
of such Stock or other required action under any federal or state law,
rule or regulation, listing or other required action with respect to any
stock exchange or automated quotation system upon which the Stock or
other Company securities are listed or quoted, or compliance with any
other obligation of the Company, as the Committee may consider
appropriate, and may require any Participant to make such
representations, furnish such information and comply with or be subject
to such other conditions as it may consider appropriate in connection
with the issuance or delivery of Stock or payment of other benefits in
compliance with applicable laws, rules, and regulations, listing
requirements, or other obligations. The foregoing notwithstanding, in
connection with a Change in Control, the Company shall take or cause to
be taken no action and shall undertake or permit to arise no legal or
contractual obligation, that results or would result in any postponement
of the issuance or delivery of Stock or payment of benefits under any
Award or the imposition of any other conditions on such issuance,
delivery or payment, to the extent that such postponement or other
condition would represent a greater burden on a Participant than existed
on the 90th day preceding the Change in Control.
(b) LIMITS ON TRANSFERABILITY; BENEFICIARIES. No Award or other
right or interest of a Participant under the Plan, including any Award
or right which constitutes a derivative security as generally defined in
Rule 16a-l(c) under the Exchange Act, shall be pledged, hypothecated or
otherwise encumbered or subject to any lien, obligation or liability of
such Participant to any party (other than the Company or a subsidiary),
or assigned or transferred by such Participant otherwise than by will or
the laws of descent and distribution or to a Beneficiary upon the death
of a Participant, and such Awards or rights that may be exercisable
shall be exercised during the lifetime of the Participant only by the
Participant or his or her guardian or legal representative, except that
Awards and other rights (other than ISOs and SARs in tandem therewith)
may be transferred to one or more Beneficiaries or other transferees
during the lifetime of the Participant, and may be exercised by such
transferees in accordance with the terms of such Award, but only if and
to the extent such transfers and exercises are permitted by the
Committee pursuant to the express terms of an Award agreement (subject
to any terms and conditions which the Committee may impose thereon, and
further subject to any prohibitions or restrictions on such transfers
pursuant to Rule 16b-3). A Beneficiary, transferee, or other person
claiming any rights under the Plan from or through any Participant shall
be subject to all terms and conditions of the Plan and any Award
agreement applicable to such Participant, except as otherwise determined
by the Committee, and to any additional terms and conditions deemed
necessary or appropriate by the Committee.
(c) ADJUSTMENTS. In the event that any dividend or other
distribution (whether in the form of cash, stock or other property),
recapitalization, forward or reverse split, reorganization, merger,
consolidation, spin-off, combination, repurchase, share exchange,
liquidation, dissolution or other similar corporate transaction or event
affects the Stock such that an adjustment is determined by the Committee
to be appropriate in order to prevent dilution or enlargement of the
rights of Participants under the Plan, then the Committee shall, in such
manner as it may deem equitable, adjust any or all of (i) the number and
kind of shares of Stock which may be delivered in connection with Awards
granted thereafter, (ii) the number and kind of shares of Stock by which
annual per-person Award limitations are measured under Section 5 hereof,
(iii) the number and kind of shares of Stock subject to or deliverable
in respect of outstanding Awards and (iv) the exercise price, grant
price or purchase price relating to any Award and/or make provision for
payment of cash or other property in respect of any outstanding Award.
In addition, the Committee is authorized to make adjustments in the
terms and conditions of, and the criteria included
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in, Awards (including Performance Awards and performance goals, and
Annual Incentive Awards and any Annual Incentive Award pool or
performance goals relating thereto) in recognition of unusual or
nonrecurring events (including, without limitation, events described in
the preceding sentence, as well as acquisitions and dispositions of
businesses and assets) affecting the Company, any subsidiary or any
business unit, or the financial statements of the Company or any
subsidiary, or in response to changes in applicable laws, regulations,
accounting principles, tax rates and regulations or business conditions
or in view of the Committee's assessment of the business strategy of the
Company, any subsidiary or business unit thereof, performance of
comparable organizations, economic and business conditions, personal
performance of a Participant, and any other circumstances deemed
relevant; provided that no such adjustment shall be authorized or made
if and to the extent that such authority or the making of such
adjustment would cause Options, SARs, Performance Awards granted under
Section 8(b) hereof or Annual Incentive Awards granted under Section
8(c) hereof to Participants designated by the Committee as Covered
Employees and intended to qualify as "performance-based compensation"
under Code Section 162(m) and the regulations thereunder to otherwise
fail to qualify as "performance-based compensation" under Code Section
162(m)and regulations thereunder.
(d) TAXES. The Company and any subsidiary is authorized to
withhold from any Award granted, any payment relating to an Award under
the Plan, including from a distribution of Stock, or any payroll or)
other payment to a Participant, amounts of withholding and other taxes
due or potentially payable in connection with any transaction involving
an Award, and to take such other action as the Committee may deem
advisable to enable the Company and Participants to satisfy obligations
for the payment of withholding taxes and other tax obligations relating
to any Award. This authority shall include authority to withhold or
receive Stock or other property and to make cash payments in respect
thereof in satisfaction of a Participant's tax obligations, either on a
mandatory or elective basis in the discretion of the Committee.
(e) CHANGES TO THE PLAN AND AWARDS. The Board may amend, alter,
suspend, discontinue or terminate the Plan or the Committee's authority
to grant Awards under the Plan without the consent of stockholders or
Participants, except that any amendment or alteration to the Plan shall
be subject to the approval of the Company's stockholders not later than
the annual meeting next following such Board action if such amendment
represents a material change to the Plan or such stockholder approval is
required by any federal or state law or regulation (including, without
limitation, Rule 16b-3 or Code Section 162(m) ) or the rules of any
stock exchange or automated quotation system on which the Stock may then
be listed or quoted, and the Board may otherwise, in its discretion,
determine to submit other such changes to the Plan to stockholders for
approval; provided that, without the consent of an affected Participant,
no such Board action may materially and adversely affect the rights of
such Participant under any previously granted and outstanding Award. The
Committee may waive any conditions or rights under, or amend, alter,
suspend, discontinue or terminate any Award theretofore granted and any
Award agreement relating thereto, except as otherwise provided in the
Plan; provided that, without the consent of an affected Participant, no
such Committee action may materially and adversely affect the rights of
such Participant under such Award. Notwithstanding anything in the Plan
to the contrary, if any right under this Plan would cause a transaction
to be ineligible for pooling of interest accounting that would, but for
the right hereunder, be eligible for such accounting treatment, the
Committee may modify or adjust the right so that pooling of interest
accounting shall be available, including the substitution of Stock
having a Fair Market Value equal to the cash otherwise payable hereunder
for the right which caused the transaction to be ineligible for pooling
of interest accounting. Notwithstanding anything herein to the contrary,
the provisions of Section 6(b)(iv) and Section 6(d)(v) of this Plan
which govern formula grants of Options and Restricted Stock to
Non-Employee Directors, shall not be amended more than once every six
months other than to comport with changes to the Code or the rules
promulgated thereunder or the Employee Retirement Income Security Act of
1974, as amended, or the rules promulgated thereunder, or with rules
promulgated by the Securities and Exchange Commission, unless such limit
on amendments is not required under Rule 16b-3 or other applicable law.
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<PAGE>
(f) LIMITATION ON RIGHTS CONFERRED UNDER PLAN. Neither the Plan
nor any action taken hereunder shall be construed as (i) giving any
Eligible Person or Participant the right to continue as an Eligible
Person or Participant or in the employ of the Company or a subsidiary;
(ii) interfering in any way with the right of the Company or a
subsidiary to terminate any Eligible Person's or Participant's
employment at any time, (iii) giving an Eligible Person or Participant
any claim to be granted any Award under the Plan or to be treated
uniformly with other Participants and employees, or (iv) conferring on a
Participant any of the rights of a stockholder of the Company unless and
until the Participant is duly issued or transferred shares of Stock in
accordance with the terms of an Award.
(g) UNFUNDED STATUS OF AWARDS; CREATION OF TRUSTS. The Plan is
intended to constitute an "unfunded" plan for incentive and deferred
compensation. With respect to any payments not yet made to a Participant
or obligation to deliver Stock pursuant to an Award, nothing contained
in the Plan or any Award shall give any such Participant any rights that
are greater than those of a general creditor of the Company, provided
that the Committee may authorize the creation of trusts and deposit
therein cash, Stock, other Awards or other property, or make other
arrangements to meet the Company's obligations under the Plan. Such
trusts or other arrangements shall be consistent with the "unfunded"
status of the Plan unless the Committee otherwise determines with the
consent of each affected Participant. The trustee of such trusts may be
authorized to dispose of trust assets and reinvest the proceeds in
alternative investments, subject to such terms and conditions as the
Committee may specify and in accordance with applicable law.
(h) NONEXCLUSIVITY OF THE PLAN. Neither the adoption of the Plan
by the Board nor its submission to the stockholders of the Company for
approval shall be construed as creating any limitations on the power of
the Board or a committee thereof to adopt such other incentive
arrangements as it may deem desirable including incentive arrangements
and awards which do not qualify under Code Section 162(m).
(i) PAYMENTS IN THE EVENT OF FORFEITURES; FRACTIONAL SHARES.
Unless otherwise determined by the Committee, in the event of a
forfeiture of an Award with respect to which a Participant paid cash or
other consideration, the Participant shall be repaid the amount of such
cash or other consideration. No fractional shares of Stock shall be
issued or delivered pursuant to the Plan or any Award. The Committee
shall determine whether cash, other Awards or other property shall be
issued or paid in lieu of such fractional shares or whether such
fractional shares or any rights thereto shall be forfeited or otherwise
eliminated.
(j) GOVERNING LAW. The validity, construction and effect of the
Plan, any rules and regulations under the Plan, and any Award agreement
shall be determined in accordance with the laws of the State of Florida
without giving effect to principles of conflicts of laws, and applicable
federal law.
(k) AWARDS UNDER PREEXISTING PLANS. Upon approval of the Plan
by stockholders of the Company, as required under Section 10(1) hereof,
no further Awards shall be granted under any Preexisting Plan.
(l) PLAN EFFECTIVE DATE AND STOCKHOLDER APPROVAL; TERMINATION OF
PLAN. The Plan shall become effective on the Effective Date, subject to
subsequent approval at the Company's 1996 Annual Meeting of
Stockholders, by stockholders of the Company eligible to vote in the
election of directors, by a vote sufficient to meet the requirements of
Code Section 162(m) and 422, Rule 16b-3 under the Exchange Act,
applicable NASDAQ requirements, and other laws, regulations, and
obligations of the Company applicable to the Plan. Awards may be granted
subject to stockholder approval, but may not be exercised or otherwise
settled in the event stockholder approval is not obtained. The Plan
shall terminate at such time as no shares of Common Stock remain
available for issuance under the Plan and the Company has no further
rights or obligations with respect to outstanding Awards under the Plan.
16
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
March 20, 1996 included in Sunglass Hut International, Inc.'s Form 10-K for the
year ended February 3, 1996 and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Miami, Florida,
January 16, 1997
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration
statement on Form S-8 of Sunglass Hut International, Inc. to be filed on or
about January 16, 1997 of our report dated June 29, 1995, on our audits of the
financial statements of Sunsations Sunglass Company as of December 31, 1994 and
for each of the two years in the period ended December 31, 1994, which is
included as an exhibit to Sunglass Hut International, Inc.'s Form 10-K for the
year ended February 3, 1996.
/s/ COOPERS & LYBRAND LLP
St. Louis, Missouri
January 16, 1997
