As filed with the Securities and Exchange Commission on August 5, 1996
Registration No. 33-
==========================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________
INTERSTATE NATIONAL DEALER SERVICES, INC.
(Exact name of registrant as specified in its charter)
Delaware 11-3078398
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
The Omni, Suite 700
333 Earle Ovington Boulevard
Mitchel Field, New York 11553
(516) 228-8600
(Address, including zip code and telephone number of principal executive
offices)
Interstate National Dealer Services, Inc.
1996 Incentive Plan
(Full title of the plan)
_________________________
Chester J. Luby
Chairman and Chief Executive Officer
Interstate National Dealer Services, Inc.
The Omni, Suite 700
333 Earle Ovington Boulevard
Mitchel Field, New York 11553
(Name, address, including zip code, of agent for service)
(516) 228-8600
(Telephone number, including area code,
of agent for service)
_________________________
Copies to:
Kenneth L. Henderson, Esq.
Robinson Silverman Pearce Aronsohn & Berman LLP
1290 Avenue of the Americas
New York, New York 10104
Approximate date of proposed sale to public:
From time to time after the effective date of this Registration Statement
CALCULATION OF REGISTRATION FEE
Title of
Each Proposed Proposed
Class of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered(1) Per Unit(1) Price(1) Fee
__________ _____________ ___________ ___________ ____________
Shares of
Common
Stock, par
value $.01 300,000 $4.875 $1,462,500 $504
(1) Estimated solely for purposes of calculating the registration
fee. Pursuant to Rules 457(c) and 457(h), the offering price and
registration fee is computed on the basis of the average of the high
and low prices reported on the Nasdaq SmallCap Market on July 31,
1996.
<PAGE>
PART I
______
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Items 1 and 2. Plan Information; Registrant Information and Employee Plan
Annual Information
The documents containing the information specified in the
instructions to Part I of the Form S-8 will be sent or given to
participants in the 1996 Incentive Plan as specified by Rule 428(b)(1).
In addition, the statement required to be made pursuant to Item 2 of Part
I of the
Form S-8 shall be contained in the Section 10(a) prospectus.
PART II
_______
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed by Interstate National Dealer
Services, Inc., a Delaware corporation (the "Company"), with the
Securities and Exchange Commission (the "Commission") are incorporated in
this Registration Statement by reference:
1. The Company's Annual Report on Form 10-KSB for the year
ended October 31, 1995, filed with the Commission on January 17, 1996.
2. The Company's Quarterly Report on Form 10-QSB for the
quarter ended April 30, 1996, filed with the Commission on June 12, 1996.
3. The description of the Shares of Common Stock found in the
Company's registration statement on Form 8-A, File No. 1-12938 (the "Form
8-A"), and the documents incorporated therein by reference, as amended by
Amendment No. 1 to the Form 8-A, filed with the Commission on April 14,
1994, and Amendment No. 2 to the Form 8-A, filed with the Commission on
April 21, 1994.
4. All documents filed subsequent to the filing date of this
Registration Statement with the Commission by the Trust or the Plan
pursuant to Section 13(a), 13(c) 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), prior to the filing of a
post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in the Registration Statement
and to be part thereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that
a statement contained herein or in any subsequently filed document which
also is, or is deemed to be incorporated by reference herein modifies or
supersedes such prior statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a
part of this Registration Statement, except as indicated herein.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law permits the
indemnification of directors, officers, employees and agents of Delaware
corporations in terms sufficiently broad to include indemnification under
certain circumstances for liabilities (including reimbursement for
expenses incurred) arising under the Securities Act. The Certificate of
Incorporation of the Company provides that the Company shall indemnify its
directors and officers to the fullest extent permitted by Delaware General
Corporation Law. The Company's By-Laws provide mandatory indemnification
rights to any officer or director of the Company who, by reason of the
fact that he or she is an officer or director of the Company, is involved
in a legal proceeding of any nature. Such indemnification rights include
reimbursement for expenses incurred by such officer of director in advance
of the final disposition of such proceeding in accordance with the
applicable provisions of the Delaware law. Insofar as indemnification for
liabilities arising under the Securities Act of 1933 (the "Securities
Act") may be permitted to officers, directors, or persons controlling the
Company pursuant to the foregoing provisions, the Company has been
informed that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
The Company maintains a standard policy of officers' and
directors' liability insurance
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
4.1 Amended and Restated Certificate of Incorporation of the
Company*
4.2 Form of Common Stock Certificate.*
4.3 Amended and Restated Bylaws of the Company.*
4.4 Interstate National Dealer Services, Inc.
1996 Incentive Plan.
5.1 Opinion of Robinson Silverman Pearce Aronsohn
& Berman LLP regarding legality.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Robinson Silverman Pearce Aronsohn
& Berman LLP (included in Exhibit 5.1).
24.1 Power of Attorney (included on signature page
of this Registration Statement).
______________
* Incorporated by reference to Registration Statement on Form SB-2,
File No. 33-74222-NY.
Item 9. Undertakings.
1. The undersigned registrant hereby undertakes:
a. To file, during any period in which it offers or sells
securities, a post-effective amendment to this Registration Statement of
1993:
(1) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(2) To reflect in the prospectus any facts or events
which, individually or in the aggregate,
represent a fundamental change in the information
set forth in the registration statement; and
(3) To include any additional or changed material
information on the plan of distribution;
provided, however, that paragraphs (1)(a)(i) and (1)(a)(ii) will not apply
if the information required to be included in a post-effective amendment
by those paragraphs is incorporated by reference from periodic reports
filed by the registrant under the Exchange Act.
b. That, for the purpose of determining any liability under
the Securities Act, to treat each post-effective amendment as a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time to be the initial bona fide
offering thereof.
c. To file a post-effective amendment to remove from
registration any of the securities that remain unsold at the termination
of the offering.
2. The undersigned registrant hereby further 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 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.
3. 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.
<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 Mitchel Field, State of New York, on the 5th
day of August, 1996.
INTERSTATE NATIONAL DEALER SERVICES, INC.
(Registrant)
By: /s/ Chester J. Luby
___________________________________________________
Chester J. Luby
Chairman and Chief Executive Officer
SIGNATURES/ POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below does hereby constitute and appoint Chester J. Luby and Cindy
H. Luby and each and any one of them, his or her true and lawful attorney-
in-fact and agent, with full power of substitution and resubstitution, for
him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments (including, without limitation,
post-effective amendments) to this Registration Statement, and to file the
same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority
to do and perform each and every act and thing requisite and necessary to
be done in and about the premises, as fully to all intents and purposes as
he or she might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents or any of them, or their or his or
her substitutes or substitute, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
_________ _____ ____
/s/ Chester J. Luby
_________________________ Chairman of the Board August 5, 1996
Chester J. Luby (Principal Executive Officer)
/s/ Cindy H. Luby
_________________________ President and Director August 5, 1996
Cindy H. Luby (Chief Operating Officer)
/s/ Zvi D. Sprung
_________________________ Chief Financial Officer August 5, 1996
Zvi D. Sprung (Chief Accounting Officer)
/s/ Louis F. Dente
_________________________ Director July 31, 1996
Louis F. Dente
/s/Robert E. Schulman
_________________________ Director August 5, 1996
Robert E. Schulman
/s/ William H. Brown
_________________________ Director July 31, 1996
William H. Brown
EXHIBIT 4.4
INTERSTATE NATIONAL DEALER SERVICES, INC.
1996 INCENTIVE PLAN
INTERSTATE NATIONAL DEALER SERVICES, INC., a corporation formed
under the laws of the State of Delaware (the "Company"), hereby
establishes and adopts the following 1996 Incentive Plan (the "Plan").
RECITALS
WHEREAS, the Company desires to encourage high levels of
performance by those individuals who are key to the success of the
Company, to attract new individuals who are highly motivated and who will
contribute to the success of the Company and to encourage such individuals
to remain as directors and/or employees of the Company and its
subsidiaries by increasing their proprietary interest in the Company's
growth and success.
WHEREAS, to attain these ends, the Company has formulated the
Plan embodied herein to authorize the granting of incentive awards through
grants of share options ("Options"), grants of share appreciation rights,
grants of Share Purchase Awards (hereafter defined), and grants of
Restricted Share Awards (hereafter defined) to those individuals whose
judgment, initiative and efforts are or have been responsible for the
success of the Company.
NOW, THEREFORE, the Company hereby constitutes, establishes and
adopts the following Plan and agrees to the following provisions:
ARTICLE 1.
PURPOSE OF THE PLAN
1.1. Purpose. The purpose of the Plan is to assist the Company
in attracting and retaining selected individuals to serve as directors,
officers, consultants, advisors and employees of the Company who will
contribute to the Company's success and to achieve long-term objectives
which will inure to the benefit of all shareholders of the Company through
the additional incentive inherent in the ownership of the Company's shares
of common stock ("Shares"). Options granted under the Plan will be either
"incentive share options," intended to qualify as such under the
provisions of section 422 of the Internal Revenue Code of 1986, as from
time to time amended (the "Code"), or "nonqualified share options." For
purposes of the Plan, the term "subsidiary" shall mean "subsidiary
corporation," as such term is defined in section 424(f) of the Code, and
"affiliate" shall have the meaning set forth in Rule 12b-2 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). For
purposes of the Plan, the term "Award" shall mean a grant of an Option, a
grant of a share appreciation right, a grant of a Share Purchase Award, a
grant of a Restricted Share Award, or any other award made under the terms
of the Plan.
ARTICLE 2.
SHARES SUBJECT TO AWARDS
2.1. Number of Shares. Subject to the adjustment provisions of
Section 9.10 hereof, the aggregate number of Shares which may be issued
under Awards under the Plan, whether pursuant to Options, share
appreciation rights, Share Purchase Awards or Restricted Share Awards
shall not exceed 300,000. No Options to purchase fractional Shares shall
be granted or issued under the Plan. For purposes of this Section 2.1,
the Shares that shall be counted toward such limitation shall include all
Shares:
(1) issued or issuable pursuant to Options that have been or
may be exercised;
(2) issued or issuable pursuant to Share Purchase Awards; and
(3) issued as, or subject to issuance as a Restricted Share
Award.
2.2. Shares Subject to Terminated Awards. The Shares covered
by any unexercised portions of terminated Options granted under Articles 4
and 6, Shares forfeited as provided in Section 8.2(a) and Shares subject
to any Awards which are otherwise surrendered by the Participant without
receiving any payment or other benefit with respect thereto may again be
subject to new Awards under the Plan. In the event the purchase price of
an Option is paid in whole or in part through the delivery of Shares, the
number of Shares issuable in connection with the exercise of the Option
shall not again be available for the grant of Awards under the Plan.
Shares subject to Options, or portions thereof, which have been
surrendered in connection with the exercise of share appreciation rights
shall not again be available for the grant of Awards under the Plan.
2.3. Character of Shares. Shares delivered under the Plan may
be authorized and unissued Shares or Shares acquired by the Company, or
both.
2.4. Limitations on Grants to Individual Participant. Subject
to adjustments pursuant to the provisions of Section 9.10 hereof, the
number of Shares which may be granted hereunder to any employee during any
fiscal year under all forms of Awards shall not exceed 50,000 Shares. If
an Option is cancelled, the cancelled Option shall continue to be counted
toward the 50,000 limit for the year granted. An Option (or a share
appreciation right) that is repriced during any fiscal year is treated as
the cancellation of the Option (or share appreciation right) and a grant
of a new Option (or share appreciation right) for purposes of the 50,000
limit for that fiscal year.
ARTICLE 3.
ELIGIBILITY AND ADMINISTRATION
3.1. Awards to Employees and Directors. (a) Participants who
receive (i) Options under Articles 4 and 6 hereof or share appreciation
rights under Article 5 ("Optionees"), and (ii) Share Purchase Awards under
Article 7 or Restricted Share Awards under Article 8 (in either case, a
"Participant"), shall consist of such key officers, employees, consultants
and Directors (hereinafter defined) of the Company or any of its sub-
sidiaries or affiliates as the Committee shall select from time to time,
provided, however, that an Option that is intended to qualify as an
"incentive share option" may be granted only to an individual that is an
employee of the Company or any of its subsidiaries. The Committee's
designation of an Optionee or Participant in any year shall not require
the Committee to designate such person to receive Awards or grants in any
other year. The designation of an Optionee or Participant to receive
Awards or grants under one portion of the Plan shall not require the
Committee to include such Optionee or Participant under other portions of
the Plan.
(b) No Option which is intended to qualify as an "incentive
share option" may be granted to any employee or Director who, at the time
of such grant, owns, directly or indirectly (within the meaning of
sections 422(b)(6) and 424(d) of the Code), shares possessing more than
10% of the total combined voting power of all classes of shares of the
Company or any of its subsidiaries or affiliates, unless at the time of
such grant, (i) the option price is fixed at not less than 110% of the
Fair Market Value (as defined below) of the Shares subject to such Option,
determined on the date of the grant, and (ii) the exercise of such Option
is prohibited by its terms after the expiration of five years from the
date such Option is granted.
3.2. Administration. (a) The Plan shall be administered by a
committee (the "Committee") consisting of not fewer than two directors of
the Company (the directors of the Company being hereinafter referred to as
the "Directors"), as designated by the Directors. The Directors may
remove from, add members to, or fill vacancies in the Committee. Each
member of the Committee will be a "disinterested person" within the
meaning of Rule 16b-3(c)(2)(i) of the Exchange Act and an "outside
director" within the meaning of Section 162(m)(4)(C)(i) of the Code,
except that if the Directors determine that (i) the Plan cannot satisfy
the requirements of Rule 16b-3 of the Exchange Act (such that grants of
Awards are not exempt from Section 16(b) of the Exchange Act), then the
members of the Committee need not be "disinterested persons," or (ii) they
no longer want the Plan to comply with the requirements of Code Section
162(m), then the members of the Committee need not be "outside directors."
Any Award to a member of the Committee shall be made strictly in
accordance with the terms of Section 4.1(b).
(b) The Committee is authorized, subject to the provisions of
the Plan, to establish such rules and regulations as it may deem
appropriate for the conduct of meetings and proper administration of the
Plan. All actions of the Committee shall be taken by majority vote of its
members.
(c) Subject to the provisions of the Plan, the Committee
shall have authority, in its sole discretion, to grant Awards under the
Plan, to interpret the provisions of the Plan and, subject to the require-
ments of applicable law, including Rule 16b-3 of the Exchange Act, to
prescribe, amend, and rescind rules and regulations relating to the Plan
or any Award thereunder as it may deem necessary or advisable. All
decisions made by the Committee pursuant to the provisions of the Plan
shall be final, conclusive and binding on all persons, including the Com-
pany, its shareholders, Directors and employees, and other Plan partici-
pants.
ARTICLE 4.
OPTIONS
4.1. Grant of Options. (a) Key Individuals, Non-Employee
Directors and Employees. The Committee shall determine, within the
limitations of the Plan, those key individuals and the Directors and
employees of the Company and its subsidiaries and affiliates to whom
Options are to be granted under the Plan, the number of Shares that may be
purchased under each such Option and the option price, and shall designate
such Options at the time of the grant as either "incentive share options"
or "nonqualified share options"; provided, however, that Options granted
to employees of an affiliate (that is not also a subsidiary) or to non-
employees of the Company may only be "nonqualified share options."
(b) Non-Employee Directors. Each Eligible Director (as
defined below) on the effective date of the Plan and each person who
thereafter is elected or appointed to membership on the Board of Directors
of the Company and who is an Eligible Director on the date of his or her
election, shall on such effective date of election or appointment
automatically be granted Options to purchase 15,000 Shares (subject to the
last sentence hereof). For purposes of this paragraph (b), an "Eligible
Director" shall be a Director who is not otherwise an officer or employee
of the Company or any of its affiliates or subsidiaries on the effective
date or on the date of such election or appointment, as the case may be,
and has not been employed by or been an officer of the Company or any of
its affiliates or subsidiaries for any part of the preceding fiscal year
of the Company. Each Option granted to an Eligible Director hereunder
shall become exercisable in installments to the extent of 20% of the
Shares covered thereby on the one-year anniversary of the date of
automatic grant and each one-year anniversary thereafter. To the extent
an Option has become exercisable, subject to the restrictions and
limitations set forth in the Plan, it may be exercised in whole or in part
pursuant to the terms of the Plan. Each Option granted to an Eligible
Director hereunder shall be exercisable for a period of ten years from the
date of automatic grant.
4.2. Share Option Agreements; etc. All Options granted pursuant
to Article 4 and Article 6 herein (a) shall be authorized by the Committee
(other than Options to Eligible Directors under Section 4.1(b)) and (b)
shall be evidenced in writing by share option agreements ("Share Option
Agreements") in such form and containing such terms and conditions as the
Committee shall determine which are not inconsistent with the provisions
of the Plan, and, with respect to any Share Option Agreement granting
Options which are intended to qualify as "incentive share options," are
not inconsistent with Section 422 of the Code. Granting of an Option
pursuant to the Plan shall impose no obligation on the recipient to
exercise such option. Any individual who is granted an Option pursuant to
this Article 4 and Article 6 herein may hold more than one Option granted
pursuant to such Articles at the same time and may hold both "incentive
share options" and "nonqualified share options" at the same time. To the
extent that any Option does not qualify as an "incentive share option"
(whether because of its provisions, the time or manner of its exercise or
otherwise) such Option or the portion thereof which does not so qualify
shall constitute a separate "nonqualified share option."
4.3. Option Price. Subject to Section 3.1(b), the option price
per each Share purchasable under any "incentive share option" granted
pursuant to this Article 4 and any "nonqualified share option" granted
pursuant to Article 6 herein shall not be less than 100% of the Fair
Market Value (as hereinafter defined) of such Share on the date of the
grant of such Option. The option price per share of each Share
purchasable under any "nonqualified share option" granted pursuant to this
Article 4 shall be such amount as the Committee shall determine at the
time of the grant of such Option. Notwithstanding the foregoing, the
option price per Share purchasable under any Option granted to an Eligible
Director pursuant to Section 4.1(b) shall be equal to 100% of the Fair
Market Value of such Share on the date of grant of such Option.
4.4. Other Provisions. Options granted pursuant to this Article
4 shall be made in accordance with the terms and provisions of Article 9
hereof and any other applicable terms and provisions of the Plan.
ARTICLE 5.
SHARE APPRECIATION RIGHTS
5.1. Grant and Exercise. Share appreciation rights may be
granted in conjunction with all or part of any Option granted under the
Plan provided such rights are granted at the time of the grant of such
Option. A "share appreciation right" is a right to receive cash or
Shares, as provided in this Article 5, in lieu of the purchase of a Share
under a related Option. A share appreciation right or applicable portion
thereof shall terminate and no longer be exercisable upon the termination
or exercise of the related Option, and a share appreciation right granted
with respect to less than the full number of Shares covered by a related
Option shall not be reduced until, and then only to the extent that, the
exercise or termination of the related Option exceeds the number of Shares
not covered by the share appreciation right. A share appreciation right
may be exercised by the holder thereof (the "Holder"), in accordance with
Section 5.2 of this Article 5, by giving written notice thereof to the
Company and surrendering the applicable portion of the related Option.
Upon giving such notice and surrender, the Holder shall be entitled to
receive an amount determined in the manner prescribed in Section 5.2 of
this Article 5. Options which have been so surrendered, in whole or in
part, shall no longer be exercisable to the extent the related share
appreciation rights have been exercised.
5.2. Terms and Conditions. Share appreciation rights shall be
subject to such terms and conditions, not inconsistent with the provisions
of the Plan, as shall be determined from time to time by the Committee,
including the following:
(a) Share appreciation rights shall be exercisable only at
such time or times and to the extent that the Options to which they
relate shall be exercisable in accordance with the provisions of the
Plan.
(b) Upon the exercise of a share appreciation right, a
Holder shall be entitled to receive up to, but no more than, an
amount in cash or whole Shares equal to the excess of the then Fair
Market Value of one Share over the option price per Share specified
in the related Option multiplied by the number of Shares in respect
of which the share appreciation right shall have been exercised. The
Holder shall specify in his written notice of exercise, whether
payment shall be made in cash or in whole Shares; provided, however,
in the case of a share appreciation right granted under the Plan to a
person then subject to Section 16 of the Exchange Act, the Holder's
written notice specifying the form of payment is subject to the
approval of the Committee. Each share appreciation right may be
exercised only at the time and so long as a related Option, if any,
would be exercisable or as otherwise permitted by applicable law;
provided, however, that no share appreciation right granted under the
Plan to a person then subject to Section 16 of the Exchange Act shall
be exercised during the first six months of its term for cash.
(c) No share appreciation right shall be transferable by a
Holder otherwise than by will or by the laws of descent and
distribution, and share appreciation rights shall be exercisable,
during the Holder's lifetime, only by the Holder.
(d) Upon the exercise of a share appreciation right, the
Option or part thereof to which such share appreciation right is
related shall be deemed to have been exercised for the purpose of the
limitation of the number of Shares to be issued under the Plan, as
set forth in Section 2.1 of the Plan.
(e) Share appreciation rights granted in connection with
an Option may be exercised only when the Fair Market Value of the
Shares subject to the Option exceeds the option price at which Shares
can be acquired pursuant to the Option.
(f) Share appreciation rights may be exercised for cash
only during the period beginning on the third business day, and
ending on the twelfth business day, following the release of
quarterly and annual summary statements of sales and earnings, as set
forth in Rule 16b-3(e)(1)(ii) of the Exchange Act.
ARTICLE 6.
RELOAD OPTIONS
6.1. Authorization of Reload Options. Concurrently with the
award of any Option (such Option hereinafter referred to as the
"Underlying Option") to any participant in the Plan, the Committee may
grant one or more reload options (each, a "Reload Option") to such
participant to purchase for cash or Shares a number of Shares as specified
below. A Reload Option shall be exercisable for an amount of Shares equal
to (i) the number of Shares delivered by the Optionee to the Company to
exercise the Underlying Option, and (ii) to the extent authorized by the
Committee, the number of Shares used to satisfy any tax withholding
requirement incident to the exercise of the Underlying Option, subject to
the availability of Shares under the Plan at the time of such exercise.
Any Reload Option may provide for the grant, when exercised, of subsequent
Reload Options to the extent and upon such terms and conditions consistent
with this Article 6, as the Committee in its sole discretion shall specify
at or after the time of grant of such Reload Option. The grant of a
Reload Option will become effective upon the exercise of an Underlying
Option or Reload Option by delivering to the Company Shares held by the
Optionee for at least six months. Notwithstanding the fact that the
Underlying Option may be an "incentive share option," a Reload Option is
not intended to qualify as an "incentive share option" under Section 422
of the Code.
6.2. Reload Option Amendment. Each Share Option Agreement
shall state whether the Committee has authorized Reload Options with
respect to the Underlying Option. Upon the exercise of an Underlying
Option or other Reload Option, the Reload Option will be evidenced by an
amendment to the underlying Share Option Agreement.
6.3. Reload Option Price. The option price per Share
deliverable upon the exercise of a Reload Option shall be the Fair Market
Value of a Share on the date the grant of the Reload Option becomes
effective.
6.4. Term and Exercise. Each Reload Option is fully
exercisable six months from the effective date of grant. The term of each
Reload Option shall be equal to the remaining option term of the
Underlying Option.
6.5. Termination of Employment. No additional Reload Options
shall be granted to Optionees when Options and/or Reload Options are
exercised pursuant to the terms of this Plan following termination of the
Optionee's employment.
6.6. Applicability of Other Sections. Except as otherwise
provided in this Article 6, the provisions of Article 9 applicable to
Options shall apply equally to Reload Options.
ARTICLE 7.
SHARE PURCHASE AWARDS
7.1. Grant of Share Purchase Award. The term "Share Purchase
Award" means the right to purchase Shares of the Company and to pay for
such Shares through a loan made by the Company to an employee (a "Purchase
Loan") as set forth in this Article 7.
7.2. Terms of Purchase Loans. (a) Purchase Loan. Each
Purchase Loan shall be evidenced by a promissory note. The term of the
Purchase Loan shall be a period of years, as determined by the Committee,
and the proceeds of the Purchase Loan shall be used exclusively by the
Participant for purchase of Shares from the Company at a purchase price
equal to the closing sales price on the National Association of Securities
Dealers, Inc. Automated Quotations System ("NASDAQ") SmallCap Market on
the date of the Share Purchase Award.
(b) Interest on Purchase Loan. A Purchase Loan shall be
non-interest bearing or shall bear interest at whatever rate the Committee
shall determine (but not in excess of the maximum rate permissible under
applicable law), payable in a manner and at such times as the Committee
shall determine. Those terms and provisions as the Committee shall
determine shall be incorporated into the promissory note evidencing the
Purchase Loan.
(c) Forgiveness of Purchase Loan. Subject to Section 7.4
hereof, the Company may forgive the repayment of up to 100% of the
principal amount of the Purchase Loan, subject to such terms and
conditions as the Committee shall determine and set forth in the
promissory note evidencing the Purchase Loan (the "Conditions"). A
Participant's Purchase Loan can be prepaid at any time, and from time to
time, without penalty.
7.3. Security for Loans. (a) Stock Power and Pledge.
Purchase Loans granted to Participants shall be secured by a pledge of the
Shares acquired pursuant to the Share Purchase Award. Such pledge shall
be evidenced by a pledge agreement (the "Pledge Agreement") containing
such terms and conditions as the Committee shall determine. Purchase
Loans shall be recourse or non-recourse with respect to a Participant, as
determined from time to time by the Committee. The share certificates for
the Shares purchased by a Participant pursuant to a Share Purchase Award
shall be issued in the Participant's name, but shall be held by the
Company as security for repayment of the Participant's Purchase Loan
together with a stock power executed in blank by the Participant (the
execution and delivery of which by the Participant shall be a condition to
the issuance of the Share Purchase Award). The Participant shall be
entitled to exercise all rights applicable to such Shares, including, but
not limited to, the right to vote such Shares and the right to receive
dividends and other distributions made with respect to such Shares. When
the Purchase Loan and any accrued but unpaid interest thereon has been
repaid or otherwise satisfied in full, the Company shall deliver to the
Participant the share certificates for the Shares purchased by a
Participant under the Share Purchase Award.
(b) Release and Delivery of Share Certificates During the
Term of the Purchase Loan. The Company shall release and deliver to each
Participant certificates for Shares purchased by a Participant pursuant to
a Share Purchase Award, in such amounts and on such terms and conditions
as the Committee shall determine, which shall be set forth in the Pledge
Agreement.
(c) Release and Delivery of Share Certificates Upon
Repayment of the Purchase Loan. The Company shall release and deliver to
each Participant certificates for the Shares purchased by the Participant
under the Share Purchase Award and then held by the Company, provided the
Participant has paid or otherwise satisfied in full the balance of the
Purchase Loan and any accrued but unpaid interest thereon. In the event
the balance of the Purchase Loan is not repaid, forgiven or otherwise
satisfied within 90 days after (i) the date repayment of the Purchase Loan
is due (whether in accordance with its term, by reason of acceleration or
otherwise), or (ii) such longer time as the Committee, in its discretion,
shall provide for repayment or satisfaction, the Company shall retain
those Shares then held by the Company in accordance with the Pledge
Agreement.
7.4. Termination of Employment. (a) Termination of Employment
by Death, Disability or by the Company Without Cause; Change of Control.
In the event of a Participant's termination of employment by reason of
death, "disability" or by the Company without "cause," or in the event of
a "change of control," the Committee shall have the right (but shall not
be required) to forgive the remaining unpaid amount (principal and
interest) of the Purchase Loan in whole or in part as of the date of such
occurrence. "Change of Control," "disability" and "cause" shall have the
respective meanings as set forth in the promissory note evidencing the
Purchase Loan.
(b) Termination of Employment by Voluntary Resignation.
In the event of a Participant's termination of employment for any reason
other than death or "disability," the Participant shall repay to the
Company the entire balance of the Purchase Loan and any accrued but unpaid
interest thereon, which amounts shall become immediately due and payable,
unless otherwise determined by the Committee.
7.5. Restrictions on Transfer. No Share Purchase Award or
Shares purchased through such an Award and pledged to the Company as
collateral security for the Participant's Purchase Loan (and accrued and
unpaid interest thereon) may be otherwise pledged, sold, assigned or
transferred (other than by will or by the laws of descent and
distribution).
ARTICLE 8.
RESTRICTED AWARDS
8.1. Restricted Share Awards. (a) Grant. A grant of Shares
made pursuant to this Article 8 is referred to as a "Restricted Share
Award." The Committee may grant to any employee an amount of Shares in
such manner, and subject to such terms and conditions relating to vesting,
forfeitability and restrictions on delivery and transfer (whether based on
performance standards, periods of service or otherwise) as the Committee
shall establish (such Shares, "Restricted Shares"). The terms of any
Restricted Share Award granted under this Plan shall be set forth in a
written agreement (a "Restricted Share Agreement") which shall contain
provisions determined by the Committee and not inconsistent with this
Plan. The provisions of Restricted Share Awards need not be the same for
each Participant receiving such Awards.
(b) Issuance of Restricted Shares. As soon as practicable
after the date of grant of a Restricted Share Award by the Committee, the
Company shall cause to be transferred on the books of the Company, Shares
registered in the name of the Company, as nominee for the Participant,
evidencing the Restricted Shares covered by the Award; provided, however,
such Shares shall be subject to forfeiture to the Company retroactive to
the date of grant, if a Restricted Share Agreement delivered to the
Participant by the Company with respect to the Restricted Shares covered
by the Award is not duly executed by the Participant and timely returned
to the Company. All Restricted Shares covered by Awards under this
Article 8 shall be subject to the restrictions, terms and conditions
contained in the Plan and the Restricted Share Agreement entered into by
and between the Company and the Participant. Until the lapse or release
of all restrictions applicable to an Award of Restricted Shares, the share
certificates representing such Restricted Shares shall be held in custody
by the Company or its designee.
(c) Shareholder Rights. Beginning on the date of grant of
the Restricted Share Award and subject to execution of the Restricted
Share Agreement as provided in Sections 8.1(a) and (b), the Participant
shall become a shareholder of the Company with respect to all Shares
subject to the Restricted Share Agreement and shall have all of the rights
of a shareholder, including, but not limited to, the right to vote such
Shares and the right to receive distributions made with respect to such
Shares; provided, however, that any Shares distributed as a dividend or
otherwise with respect to any Restricted Shares as to which the
restrictions have not yet lapsed shall be subject to the same restrictions
as such Restricted Shares and shall be represented by book entry and held
as prescribed in Section 8.1(b).
(d) Restriction on Transferability. None of the
Restricted Shares may be assigned or transferred (other than by will or
the laws of descent and distribution), pledged or sold prior to lapse or
release of the restrictions applicable thereto.
(e) Delivery of Shares Upon Release of Restrictions. Upon
expiration or earlier termination of the forfeiture period without a
forfeiture and the satisfaction of or release from any other conditions
prescribed by the Committee, the restrictions applicable to the Restricted
Shares shall lapse. As promptly as administratively feasible thereafter,
subject to the requirements of Section 11.1, the Company shall deliver to
the Participant or, in case of the Participant's death, to the
Participant's beneficiary, one or more stock certificates for the
appropriate number of Shares, free of all such restrictions, except for
any restrictions that may be imposed by law.
8.2. Terms of Restricted Shares. (a) Forfeiture of Restricted
Shares. Subject to Section 8.2(b), all Restricted Shares shall be
forfeited and returned to the Company and all rights of the Participant
with respect to such Restricted Shares shall terminate unless the
Participant continues in the service of the Company as an employee until
the expiration of the forfeiture period for such Restricted Shares and
satisfies any and all other conditions set forth in the Restricted Share
Agreement. The Committee in its sole discretion, shall determine the
forfeiture period (which may, but need not, lapse in installments) and any
other terms and conditions applicable with respect to any Restricted Share
Award.
(b) Waiver of Forfeiture Period. Notwithstanding anything
contained in this Article 8 to the contrary, the Committee may, in its
sole discretion, waive the forfeiture period and any other conditions set
forth in any Restricted Share Agreement under appropriate circumstances
(including the death, disability or retirement of the Participant or a
material change in circumstances arising after the date of an Award) and
subject to such terms and conditions (including forfeiture of a
proportionate number of the Restricted Shares) as the Committee shall deem
appropriate.
ARTICLE 9.
GENERALLY APPLICABLE PROVISIONS
9.1. Option Period. Subject to Section 3.1(b), the period for
which an Option is exercisable shall not exceed ten years from the date
such Option is granted, provided, however, in the case of an Option that
is not intended to be an "incentive share option," the Committee may
prescribe a period in excess of ten years. After the Option is granted,
the option period may not be reduced.
9.2. Fair Market Value. If the Shares are listed or admitted
to trading on a securities exchange registered under the Exchange Act, the
"Fair Market Value" of a Share as of a specified date shall mean the
average of the high and low price of the shares for the day immediately
preceding the date as of which Fair Market Value is being determined (or
if there was no reported sale on such date, on the last preceding date on
which any reported sale occurred) reported on the principal securities
exchange on which the Shares are listed or admitted to trading. If the
Shares are not listed or admitted to trading on any such exchange but are
listed as a national market security on NASDAQ, traded in the over-the-
counter market or listed or traded on any similar system then in use, the
Fair Market Value of a Share shall be the average of the high and low
sales price for the day immediately preceding the date as of which the
Fair Market Value is being determined (or if there was no reported sale on
such date, on the last preceding date on which any reported sale occurred)
reported on such system. If the Shares are not listed or admitted to
trading on any such exchange, are not listed as a national market security
on NASDAQ and are not traded in the over-the-counter market or listed or
traded on any similar system then in use, but are quoted on NASDAQ or any
similar system then in use, the Fair Market Value of a Share shall be the
average of the closing high bid and low asked quotations on such system
for the Shares on the date in question. If the Shares are not publicly
traded, Fair Market Value shall be determined by the Committee in its sole
discretion using appropriate criteria. An Option shall be considered
granted on the date the Committee acts to grant the Option or such later
date as the Committee shall specify.
9.3. Exercise of Options. Options granted under the Plan shall
be exercised by the Optionee thereof (or by his executors, administrators,
guardian or legal representative, as provided in Sections 9.6 and 9.7
hereof) as to all or part of the Shares covered thereby, by the giving of
written notice of exercise to the Company, specifying the number of Shares
to be purchased, accompanied by payment of the full purchase price for the
Shares being purchased. Full payment of such purchase price shall be made
within five business days following the date of exercise and shall be made
(i) in cash or by certified check or bank check, (ii) with the consent of
the Committee, by delivery of a promissory note in favor of the Company
upon such terms and conditions as determined by the Committee, (iii) with
the consent of Committee, by tendering previously acquired Shares (valued
at its Fair Market Value, as determined by the Committee as of the date of
tender), or (iv) with the consent of the Committee, any combination of
(i), (ii) and (iii); provided, however, that payment may not be pursuant
to (iii) above unless the Optionee shall have owned the Shares being
tendered in payment for a period of at least six months prior to the date
of exercise of the Option. Such notice of exercise, accompanied by such
payment, shall be delivered to the Company at its principal business
office or such other office as the Committee may from time to time direct,
and shall be in such form, containing such further provisions consistent
with the provisions of the Plan, as the Committee may from time to time
prescribe. In no event may any Option granted hereunder be exercised for
a fraction of a Share. The Company shall effect the transfer of Shares
purchased pursuant to an Option as soon as practicable, and, within a
reasonable time thereafter, such transfer shall be evidenced on the books
of the Company. No person exercising an Option shall have any of the
rights of a holder of Shares subject to an Option until certificates for
such Shares shall have been issued following the exercise of such Option.
No adjustment shall be made for cash dividends or other rights for which
the record date is prior to the date of such issuance.
9.4. Non-Transferability of Options. Except as provided in
Section 9.11, no Option shall be assignable or transferable by the
Optionee, other than by will or the laws of descent and distribution, and
may be exercised during the life of the Optionee only by the Optionee or
his guardian or legal representative.
9.5. Termination of Employment. In the event of the
termination of employment of an Optionee or the termination or separation
from service of an advisor or consultant or a Director (who is an
Optionee) for any reason (other than death or disability as provided
below), any Option(s) granted to such Optionee under this Plan and not
previously exercised or expired shall be deemed cancelled and terminated
on the day of such termination or separation, unless the Committee
decides, in its sole discretion, to extend the term of the Option for a
period not to exceed three months after the date of such termination or
separation, provided, however, that in no instance may the term of the
Option, as so extended, exceed the maximum term established pursuant to
Section 3.1(b)(ii) or 9.1 above. Notwithstanding the foregoing, in the
event of the termination or separation from service of an Optionee for any
reason other than death or disability, under conditions satisfactory to
the Company, the Committee may, in its sole discretion, allow any
"nonqualified share options" granted to such Optionee under the Plan and
not previously exercised or expired to be exercisable for a period of time
to be specified by the Committee, provided, however, that in no instance
may the term of the Option, as so extended, exceed the maximum term
established pursuant to Section 9.1 above.
9.6. Death. In the event an Optionee dies while employed by
the Company or any of its subsidiaries or affiliates or during his term as
a Director of the Company or any of its subsidiaries or affiliates, as the
case may be, any Option(s) granted to him not previously expired or
exercised shall, to the extent exercisable on the date of death, be
exercisable by the estate of such Optionee or by any person who acquired
such Option by bequest or inheritance, at any time within one year after
the death of the Optionee, unless earlier terminated pursuant to its
terms, provided, however, that if the term of such Option would expire by
its terms within six months after the Optionee's death, the term of such
Option shall be extended until six months after the Optionee's death,
provided further, however, that in no instance may the term of the Option,
as so extended, exceed the maximum term established pursuant to Section
3.1(b)(ii) or 9.1 above.
9.7. Disability. In the event of the termination of employment
of an Optionee or the separation from service of a Director (who is an
Optionee) due to total disability, the Optionee, or his guardian or legal
representative, shall have the unqualified right to exercise any Option(s)
which have not been previously exercised or expired and which the Optionee
was eligible to exercise as of the first date of total disability (as
determined by the Committee), at any time within one year after such
termination or separation, unless earlier terminated pursuant to its
terms, provided, however, that if the term of such Option would expire by
its terms within six months after such termination or separation, the term
of such Option shall be extended until six months after such termination
or separation, provided further, however, that in no instance may the term
of the Option, as so extended, exceed the maximum term established
pursuant to Section 3.1(b)(ii) or 9.1 above. The term "total disability"
shall, for purposes of this Plan, be defined in the same manner as such
term is defined in Section 22(e)(3) of the Code.
9.8. Six-Month Holding Period. Notwithstanding anything to the
contrary in the Plan, each Option (or the Shares underlying the Option)
granted to an individual who is an officer of the Company or otherwise
subject to Section 16(b) of the Exchange Act, must be held by such
individual for a combined period of at least six months from the date the
Option is granted (or until such earlier date as satisfies any legal
requirement for exemption under Rule 16b-3 of the Exchange Act and as
satisfies all other applicable law); provided that the sale, transfer or
other disposition of any Shares underlying any Option shall be permitted
within such period to the extent the sale, transfer or other disposition
is exempt under Rule 16b-3 of the Exchange Act and all other applicable
law.
9.9. Amendment and Modification of the Plan. The Board of
Directors of the Company may, from time to time, alter, amend, suspend or
terminate the Plan as it shall deem advisable, subject to any requirement
for shareholder approval imposed by applicable law or any rule of any
stock exchange or quotation system on which Shares are listed or quoted;
provided that the Board of Directors may not amend the Plan in any manner
that would result in noncompliance with Rule 16b-3 of the Exchange Act or
any applicable law, except as otherwise provided in Sections 3.2 or 9.11
hereof; and further provided that the Board of Directors may not, without
the approval of the Company's shareholders, amend the Plan to (a) increase
the number of Shares that may be the subject of Options under the Plan
(except for adjustments pursuant to Section 9.10 hereof), (b) reduce the
minimum option price specified by Sections 3.1(b) and 4.3 hereof, (c)
increase the maximum permissible term of any Option specified by Section
3.1(b)(ii) or 9.1 hereof, and (d) remove responsibility for administering
the Plan from the Committee. In addition, no amendments to, or
termination of, the Plan shall in any way impair the rights of an Optionee
or a Participant under any Award previously granted without such
Optionee's or Participant's consent.
9.10. Adjustments. In the event that the Committee shall
determine that any dividend or other distribution (whether in the form of
cash, Shares, other securities, or other property), recapitalization,
stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase, or exchange of Shares or
other securities, the issuance of warrants or other rights to purchase
Shares or other securities, or other similar corporate transaction or
event affects the Shares with respect to which Options have been or may be
issued under the Plan, such that an adjustment is determined by the
Committee to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the
Plan, then the Committee shall, in such manner as the Committee may deem
equitable, adjust any or all of (i) the number and type of Shares that
thereafter may be made the subject of Options, (ii) the number and type of
Shares subject to outstanding Options and share appreciation rights, and
(iii) the grant or exercise price with respect to any Option, or, if
deemed appropriate, make provision for a cash payment to the holder of any
outstanding Option; provided, in each case, that with respect to
"incentive share options," no such adjustment shall be authorized to the
extent that such adjustment would cause such options to violate Section
422(b) of the Code or any successor provision; and provided further, that
the number of Shares subject to any Option denominated in Shares shall
always be a whole number.
9.11. Other Provisions. Notwithstanding anything in this Plan
to the contrary, if the Board of Directors determine that the Plan cannot,
or that an Award need not, satisfy the requirements of Rule 16b-3 of the
Exchange Act (such that grants of Awards are not exempt from Section 16(b)
of the Exchange Act), then the Committee shall have the authority to waive
or modify those provisions of the Plan which are intended to satisfy such
Rule 16b-3 requirements and shall allow an Optionee who has been granted
"nonqualified share options" to transfer any or all of such options to any
one or more of the following persons: (i) the spouse, parent, issue,
spouse of issue, or issue of spouse ("issue" shall include all descendants
whether natural or adopted) of such Optionee; or (ii) a trust for the
benefit of those persons described in clause (i) above or for the benefit
of such Optionee, or for the benefit of any such persons and such
Optionee; provided, however, that such transferee shall be bound by all of
the terms and conditions of this Plan and shall execute an agreement
satisfactory to the Company evidencing such obligation; and provided
further, however, that such Optionee shall remain bound by the terms and
conditions of this Plan. The Company shall cooperate with an Optionee's
transferee and the Company's transfer agent in effectuating any transfer
permitted pursuant to this Section 9.11.
ARTICLE 10.
OTHER AWARDS
10.1b Grants of Other Awards. Notwithstanding anything in this
Plan to the contrary, including without limitation the provisions of
Sections 2.4, 9.1, 9.4, 9.5, 9.6 and 9.7, (i) the Committee shall have the
authority to grant "nonqualified share options" to an individual who
retires from the Company and is no longer an employee or Director of the
Company, and (ii) the terms of such a grant shall be subject to the terms
and provisions of this Plan, except as otherwise determined by the
Committee and set forth in the Share Option Agreement evidencing the
grant.
ARTICLE 11.
MISCELLANEOUS
11.1. Tax Withholding. The Company shall notify an Optionee or
Participant of any income tax withholding requirements arising as a result
of the grant of any Award, exercise of an Option or share appreciation
rights or any other event occurring pursuant to this Plan. The Company
shall have the right to withhold from such Optionee or Participant such
withholding taxes as may be required by law, or to otherwise require the
Optionee or Participant to pay such withholding taxes. If the Optionee or
Participant shall fail to make such tax payments as are required, the
Company or its subsidiaries or affiliates shall, to the extent permitted
by law, have the right to deduct any such taxes from any payment of any
kind otherwise due to such Optionee or Participant or to take such other
action as may be necessary to satisfy such withholding obligations.
11.2. Right of Discharge Reserved. Nothing in the Plan nor the
grant of an Award hereunder shall confer upon any employee, Director or
other individual the right to continue in the employment or service of the
Company or any subsidiary or affiliate of the Company or affect any right
that the Company or any subsidiary or affiliate of the Company may have to
terminate the employment or service of (or to demote or to exclude from
future Options under the Plan) any such employee, Director or other in-
dividual at any time for any reason. Except as specifically provided by
the Committee, the Company shall not be liable for the loss of existing or
potential profit from an Award granted in the event of termination of an
employment or other relationship even if the termination is in violation
of an obligation of the Company or any subsidiary or affiliate of the
Company to the employee or Director.
11.3. Nature of Payments. All Awards made pursuant to the Plan
are in consideration of services performed or to be performed for the Com-
pany or any subsidiary or affiliate of the Company. Any income or gain
realized pursuant to Awards under the Plan and any share appreciation
rights constitutes a special incentive payment to the Optionee,
Participant or Holder and shall not be taken into account, to the extent
permissible under applicable law, as compensation for purposes of any of
the employee benefit plans of the Company or any subsidiary or affiliate
of the Company except as may be determined by the Committee or by the
Directors or directors of the applicable subsidiary or affiliate of the
Company.
11.4. Severability. If any provision of the Plan shall be held
unlawful or otherwise invalid or unenforceable in whole or in part, such
unlawfulness, invalidity or unenforceability shall not affect any other
provision of the Plan or part thereof, each of which remain in full force
and effect. If the making of any payment or the provision of any other
benefit required under the Plan shall be held unlawful or otherwise
invalid or unenforceable, such unlawfulness, invalidity or unenforce-
ability shall not prevent any other payment or benefit from being made or
provided under the Plan, and if the making of any payment in full or the
provision of any other benefit required under the Plan in full would be
unlawful or otherwise invalid or unenforceable, then such unlawfulness,
invalidity or unenforceability shall not prevent such payment or benefit
from being made or provided in part, to the extent that it would not be
unlawful, invalid or unenforceable, and the maximum payment or benefit
that would not be unlawful, invalid or unenforceable shall be made or
provided under the Plan.
11.5. Gender and Number. In order to shorten and to improve the
understandability of the Plan document by eliminating the repeated usage
of such phrases as "his or her" and any masculine terminology herein shall
also include the feminine, and the definition of any term herein in the
singular shall also include the plural except when otherwise indicated by
the context.
11.6. Governing Law. The Plan and all determinations made and
actions taken thereunder, to the extent not otherwise governed by the Code
or the laws of the United States, shall be governed by the laws of the
State of Delaware and construed accordingly.
11.7. Effective Date of Plan; Termination of Plan. The Plan
shall be effective on the date of the approval of the Plan by the holders
of a majority of the shares entitled to vote at a duly constituted meeting
of the shareholders; provided, however, that the adoption of the Plan is
subject to such shareholder approval within 12 months after the date of
adoption of the Plan by the Board of Directors. The Plan shall be null
and void and of no effect if the foregoing condition is not fulfilled and
in such event each Award and related share appreciation rights shall,
notwithstanding any of the preceding provisions of the Plan, be null and
void and of no effect. Awards may be granted under the Plan at any time
and from time to time on or prior to April 17, 2006, on which date the
Plan will expire except as to Awards and related share appreciation rights
then outstanding under the Plan. Such outstanding Awards and share
appreciation rights shall remain in effect until they have been exercised
or terminated, or have expired.
11.8. Captions. The captions in this Plan are for convenience
of reference only, and are not intended to narrow, limit or affect the
substance or interpretation of the provisions contained herein.
EXHIBIT 5.1
August 5, 1996
Interstate National Dealer Services, Inc.
333 Earle Ovington Boulevard, Suite 700
Mitchel Field, New York 11553
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-8 (the
"Registration Statement") to be filed by Interstate National Dealer
Services, Inc., a Delaware corporation (the "Company"), on or about the
date hereof with the Securities and Exchange Commission (the "Commission")
in connection with the registration under the Securities Act of 1933, as
amended (the "Securities Act"), of 300,000 shares of the Company's common
stock, $.01 par value per share (the "Common Stock"), reserved for
issuance pursuant to the terms of the Company's 1996 Incentive Plan,
(the "Plan").
We are familiar with the Amended and Restated Certificate of
Incorporation, and the Amended and Restated Bylaws of the Company and have
examined copies of the Plan, the resolutions adopted by the Company's Board
of Directors and actions by the Company's stockholders pertaining to the
Plan, and originals or copies, certified or otherwise identified to our
satisfaction, of such other documents, evidence of corporate action,
certificates and other instruments, and have made such other
investigations of law and fact, as we have deemed necessary or appropriate
for the purposes of this opinion.
Based upon the foregoing, it is our opinion that the 300,000
shares of Common Stock reserved for issuance pursuant to the terms of the
Plan have been duly authorized and, when issued in accordance with the
terms of the Plan and upon payment of the purchase price therefor, will be
validly issued, fully paid and non-assessable.
We hereby consent to the use of this opinion in the Registration
Statement. In giving this consent, we do not thereby admit that we come
within the category of persons whose consent is required under Section 7
of the Securities Act or the Rules and Regulations of the Commission
thereunder.
Very truly yours,
ROBINSON SILVERMAN PEARCE
ARONSOHN & BERMAN LLP
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Form S-8 registration statement of our report dated
January 4, 1996 included in the Interstate national Dealer Services, Inc.
Form 10-KSB for the year ended October 31, 1995 and to al references to
our Firm included in this Form S-8 registration statement.
ARTHUR ANDERSEN LLP
Melville, New York
August 5, 1995
