<PAGE>
As filed with the Securities and Exchange Commission on July 1, 1998
Registration No. 33-97908-D
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
______________________
ACT TELECONFERENCING, INC.
(Exact name of Registrant as specified in its charter)
Colorado 84-1132665
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1658 Cole Boulevard 80401
Suite 130 (Zip Code)
Golden, Colorado
(Address of principal executive offices)
ACT TELECONFERENCING, INC. EMPLOYEE STOCK PURCHASE PLAN OF 1998
AND
ACT TELECONFERENCING, INC. STOCK OPTION PLAN OF 1996, As Amended
(Full title of the plans)
Gerald D. Van Eeckhout
1658 Cole Boulevard
Suite 130
Golden, Colorado 80401
(Name and address of agent for service)
(303) 235-9000
(Telephone number, including area code, of agent for service)
______________________
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================
Proposed
Proposed maximum
Title of Amount maximum aggregate Amount of
securities to to be offering price offering registration
be registered registered per share (1) price (1) fee
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 400,000 $9.3750 $3,750,000 $1,106.25
shares
no par value
Employee Stock
Purchase Plan of 1998
- --------------------------------------------------------------------------------------------------------------------
Common Stock, 100,000
no par value shares $9.3750 $937,000 $276.56
Stock Option Plan of
1996
====================================================================================================================
</TABLE>
(1) Estimated pursuant to Rules 457(c) and 457(h)(1) under the Securities Act
of 1933, as amended, solely for the purpose of calculating the registration
fee, based on the average high and low sale prices per share of the
registrant's common stock on June 29, 1998, as reported on the Nasdaq
National Market System.
================================================================================
<PAGE>
ACT TELECONFERENCING, INC.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents of ACT Teleconferencing, Inc. (the "Company")
filed with the Securities and Exchange Commission (the "Commission") are
incorporated in this Registration Statement by reference and made a part hereof:
(1) The Company's Annual Report on Form 10-KSB, filed March 24, 1998,
which contains audited financial statements for the Company's
fiscal year ended December 31, 1997, the latest fiscal year for
which such statements have been filed.
(2) All other reports filed by the Company pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the end of the fiscal year ended December
31, 1997.
(3) The description of the Company's Common Stock which is contained
in the Registration Statement on Form SB-2 filed October 10, 1995
under the Securities Act and all amendments and reports filed for
the purpose of updating such description.
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date of this Registration Statement and prior to the filing of a post-
effective amendment which indicates that all of the shares of Common Stock
offered have been sold or which deregisters all shares of the Common Stock then
remaining unsold shall be deemed to be incorporated by reference in and a part
of this Registration Statement from the date of filing of such documents.
Any statement contained in a document incorporated, or deemed to be
incorporated, by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or incorporated herein by reference or in any other
subsequently filed document that also is or is deemed to be incorporated by
reference herein modifies or supersedes such 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.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
The Colorado Business Corporation Act (the "Act") permits a
corporation organized under the Act to indemnify its directors, officers,
employees, and agents for certain of their acts. The Articles of Incorporation
of the Company have been framed so as to conform to the Colorado Business
Corporation Act. (Reference is made to the Restated Articles of Incorporation
filed as Exhibit 4.1 to this Registration Statement.)
In general, the Company may indemnify any officer, director, employee,
fiduciary, or agent against reasonable expenses, fines, penalties, settlements,
or judgments arising in connection with a legal proceeding to which such person
is a party, if that person's actions were in good faith, were reasonably
believed to be in the Company's best interest, and were not unlawful.
Indemnification is mandatory with respect to a director or officer who was
wholly successful in defense of a proceeding. In all other cases,
indemnification of a director,
II-2
<PAGE>
officer, employee, or agent requires a determination by independent decision of
the Board of Directors, by independent legal counsel, or by a vote of the
shareholders that the applicable standard of conduct was met by the person to be
indemnified.
The circumstances under which indemnification is granted in connection
with an action brought on behalf of the Company are generally the same as those
set forth above; however, with respect to such actions against directors,
indemnification is granted only with respect to reasonable expenses actually
incurred in connection with the defense or settlement of the action. In such
actions, the person to be indemnified must have acted in good faith and in a
manner the person reasonably believed was in the Company's best interest; the
person must not have been adjudged liable to the Company; and the person must
not have received an improper personal benefit.
Indemnification may also be granted pursuant to the terms of
agreements which may be entered into in the future pursuant to a vote of
shareholders or directors. In addition, the Company is authorized to purchase
and maintain insurance which protects its officers and directors against any
liabilities incurred in connection with their services in such a position, and
such a policy may be obtained by the Company in the future.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
Exhibit Description
------- -----------
4.1 Restated Articles of Incorporation of the Company
(incorporated by reference herein and attached as
Exhibit 3.1 to the Company's Form 10-QSB for the Quarter
Ended March 31, 1996, File No. 000-27560, filed on May
5, 1996 ).
4.2 By-Laws of the Company (incorporated by reference herein
and attached as Exhibit 3.2 to the Company's Form 10-QSB
for the Quarter Ended March 31, 1996, File No. 000-
27560, filed on May 5, 1996).
4.3 Form of specimen certificate for Common Stock of the
Company (incorporated by reference herein and attached
as Exhibit 4.1 to the Company's Form SB-2 Registration
Statement, Registration No. 33-97908-D, filed on October
10, 1995).
4.4 ACT Teleconferencing, Inc. Stock Option Plan of 1996
(incorporated by reference herein and attached as
Exhibit 10.19 to the Company's Schedule 14A, File No.
000-27560, filed on April 30, 1997), as amended by
Shareholder approval pursuant to Schedule 14A, File No.
000-27560, filed on April 15, 1998 (incorporated by
reference herein).
4.5 ACT Teleconferencing, Inc. Employee Stock Purchase Plan
of 1998, also referred to as the ActionShare Employee
Stock Purchase Plan (incorporated by reference herein
and attached as Appendix A to the Company's Schedule
14A, File No. 000-27560, filed on April 15, 1998).
4.6 ACT Teleconferencing, Inc. Stock Option Plan of 1996 as
amended.
5 Opinion of Faegre & Benson LLP as to the legality of the
shares being registered.
23.1 Consent of Faegre & Benson LLP is contained in its
opinion filed as Exhibit 5 to this Registration
Statement.
23.2 Consent of Ernst & Young LLP.
II-3
<PAGE>
24 Power of Attorney authorizing Gavin Thomson to sign this
Registration Statement on behalf of Ronald J. Bach,
James F. Seifert, Carolyn R. Van Eeckhout, and Donald L.
Sturtevant.
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 to:
(i) include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; (ii) reflect in the prospectus any facts or
events arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change in
the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective Registration Statement; and (iii) include any material
information with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material change to such
information in the Registration Statement; provided, however, that
paragraphs (A)(1)(i) and (A)(1)(ii) do not apply if the registration
statement is on Form S-3 or S-8, and the information required to be
included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Company pursuant to Section
13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
B. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Company's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers, and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer, or controlling person of the Company 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 Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company 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 Golden, State of Colorado, on June 30, 1998.
ACT TELECONFERENCING, INC.
By /s/ Gerald D. Van Eeckhout
----------------------------------------
Gerald D. Van Eeckhout
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on July 1, 1998 by the following persons
in the capacities indicated.
Signature Capacity
- --------- --------
/s/ Gerald D. Van Eeckhout Chief Executive Officer and Director
- -------------------------------
Gerald D. Van Eeckhout (Principal Executive Officer)
/s/ Gavin Thomson Chief Financial Officer and Secretary
- -------------------------------
Gavin Thomson (Principal Financial and Accounting
Officer)
/s/ Ronald J. Bach Director
- -------------------------------
Ronald J. Bach
/s/ James F. Seifert Director
- -------------------------------
James F. Seifert
/s/ Carolyn R. Van Eeckhout Director
- -------------------------------
Carolyn R. Van Eeckhout
/s/ Donald L. Sturtevant Director
- -------------------------------
Donald L. Sturtevant
II-5
<PAGE>
INDEX TO EXHIBITS
Exhibit Description (Method of Filing)
- ------- ------------------------------
4.1 Restated Articles of Incorporation of the Company
(incorporated by reference herein and attached as Exhibit 3.1
to the Company's Form 10-QSB for the Quarter Ended March 31,
1996, File No. 000-27560, filed on May 5, 1996 ).
4.2 By-Laws of the Company (incorporated by reference herein and
attached as Exhibit 3.2 to the Company's Form 10-QSB for the
Quarter Ended March 31, 1996, File No. 000-27560, filed on May
5, 1996).
4.3 Form of specimen certificate for Common Stock of the Company
(incorporated by reference herein and attached as Exhibit 4.1
to the Company's Form SB-2 Registration Statement,
Registration No. 33-97908-D, filed on October 10, 1995).
4.4 ACT Teleconferencing, Inc. Stock Option Plan of 1996
(incorporated by reference herein and attached as Exhibit
10.19 to the Company's Schedule 14A, File No. 000-27560, filed
on April 30, 1997), as amended by Shareholder approval
pursuant to Schedule 14A, File No. 000-27560, filed on April
15, 1998 (incorporated by reference herein).
4.5 ACT Teleconferencing, Inc. Employee Stock Purchase Plan of
1998, also referred to as the ActionShare Employee Stock
Purchase Plan (incorporated by reference herein and attached
as Appendix A to the Company's Schedule 14A, File No. 000-
27560, filed on April 15, 1998).
4.6 ACT Teleconferencing, Inc. Stock Option Plan of 1996 as
amended (Filed electronically).
5 Opinion of Faegre & Benson LLP as to the legality of the
shares being registered (Filed electronically).
23.1 Consent of Faegre & Benson LLP is contained in its opinion
filed as Exhibit 5 to this Registration Statement (Filed
electronically).
23.2 Consent of Ernst & Young LLP (Filed electronically).
24 Power of Attorney authorizing Gavin Thomson to sign this
Registration Statement on behalf of Ronald J. Bach, James F.
Seifert, Carolyn R. Van Eeckhout, and Donald L. Sturtevant
(Filed electronically).
<PAGE>
EXHIBITS 5 and 23.1
-------------------
July 1, 1998
Board of Directors
ACT Teleconferencing, Inc.
1658 Cole Boulevard
Suite 162
Golden, Colorado 80401
RE: Opinion and Consent
-------------------
Gentlemen and Mrs. Van Eeckhout:
In connection with the proposed registration under the Securities Act of
1933, as amended, of shares of Common Stock of ACT Teleconferencing, Inc., a
Colorado corporation (the "Company"), offered and to be offered pursuant to the
ACT Employee Stock Purchase Plan of 1998 and ACT Teleconferencing, Inc. Stock
Option Plan of 1996, as amended (the "Plans"), we have examined the Company's
Restated Articles of Incorporation, its By-Laws, and such other documents,
including the Registration Statement on Form S-8, dated the date hereof, to be
filed with the Securities and Exchange Commission relating to such shares (the
"Registration Statement"), and have reviewed such matters of law as we have
deemed necessary for this opinion. Accordingly, based upon the foregoing, we are
of the opinion that:
1. The Company is duly and validly organized and existing and in good
standing under the laws of the State of Colorado.
2. The Company has duly authorized the issuance of the shares of Common
Stock which may be issued pursuant to the Plans.
3. The shares which may be issued pursuant to the Plans will be, upon
issuance, validly issued and outstanding and fully paid and nonassessable.
4. All necessary corporate action has been taken by the Company to adopt
the Plans, and the Plans are validly existing plans of the Company.
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
FAEGRE & BENSON LLP
<PAGE>
Exhibit 23.2
------------
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 33-97908-D) pertaining to the ACT Teleconferencing, Inc. Employee Stock
Purchase Plan of 1998 and the ACT Teleconferencing, Inc. Stock Option Plan of
1996, As Amended of our report dated February 20, 1998, with respect to the
consolidated financial statements and schedules of ACT Teleconferencing, Inc.
included in its Form 10-KSB for the year ended December 31, 1997, filed with the
Securities and Exchange Commission.
ERNST & YOUNG LLP
Denver, Colorado
June 26, 1998
<PAGE>
Exhibit 24
----------
POWER OF ATTORNEY
-----------------
The undersigned hereby constitutes and appoints Gavin Thomson, such
person's true and lawful attorney-in-fact and agent with full power of
substitution and resubstitution for such person and in such persons' name, place
and stead, in any and all capacities, to sign the Registration Statement on Form
S-8 of ACT Teleconferencing, Inc. regarding the ACT TELECONFERENCING, INC.
EMPLOYEE STOCK PURCHASE PLAN OF 1998 and ACT TELECONFERENCING, INC. STOCK OPTION
PLAN OF 1996, as amended, to be filed in June 1998 and any or all amendments
(including post-effective amendments) to the Registration Statement, and to file
the same, with all exhibits hereto 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 such person might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or either of them, or their substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.
/s/ Ronald J. Bach
---------------------------
Ronald J. Bach
/s/ James F. Seifert
---------------------------
James F. Seifert
/s/ Carolyn R. Van Eeckhout
---------------------------
Carolyn R. Van Eeckhout
/s/ Donald L. Sturtevant
---------------------------
Donald L. Sturtevant
<PAGE>
EXHIBIT 4.6
ACT TELECONFERENCING, INC.
STOCK OPTION PLAN OF 1996, AS AMENDED
1. Purpose. The purpose of this Stock Option Plan of 1996 (the
"Plan") is to enhance stockholder investment by attracting, retaining, and
motivating directors, officers, all employees, and consultants of ACT
Teleconferencing, Inc. (the "Company"), and to encourage stock ownership by such
persons by providing them with a means to acquire a proprietary interest in the
Company.
2. Administration.
(a) General. This Plan shall be administered by a
Personnel and Compensation Committee made up of two or more directors
of the Company (the "Committee") appointed by the Company's Board of
Directors (the "Board"). The Committee shall have the power, subject to
the limitations contained in this Plan, to fix any terms and conditions
for the grant or exercise of any option under this Plan. Unless the
entire Board shall constitute the Committee, no director shall serve as
a member of the Committee unless such director shall be a "non-employee
director" as that term is defined in Rule 16b-3 promulgated under the
Securities Exchange Act of 1934 (the "Exchange Act") or any successor
statute or regulation comprehending the same subject matter. A majority
of the members of the Committee shall constitute a quorum for any
meeting of the Committee, and the acts of a majority of the members
present at any meeting at which a quorum is present or the acts
unanimously approved in writing by all members of the Committee shall
be the acts of the Committee. Subject to the provisions of this Plan,
the Committee may from time to time adopt such rules for the
administration of this Plan as it deems appropriate. The decision of
the Committee on any matter affecting this Plan or the rights and
obligations arising under this Plan or any option granted hereunder,
shall be final, conclusive and binding upon all persons, including
without limitation the Company, shareholders and optionees.
(b) Indemnification. To the full extent permitted by law,
(i) no member of the Committee shall be liable for any action or
determination taken or made in good faith with respect to this Plan or
any option granted hereunder and (ii) the members of the Committee and
each person to whom the Committee delegates authority under this Plan
shall be entitled to indemnification by the Company against and from
any loss incurred by such member or person by reason of any such
actions and determinations.
3. Shares. The shares that may be made subject to options
granted under this Plan shall be authorized and unissued shares of Common Stock
of the Company, no par value ("Shares," and each individually a "Share"), and
they shall not exceed 800,000 Shares in the aggregate, subject to adjustment as
provided in paragraph 13, below, except that, if any option lapses or terminates
for any reason before such option has been completely exercised, the Shares
covered by the unexercised portion of such option may again be made subject to
options granted under this Plan.
4. Eligible Participants. For purposes of this Plan, any
person, including an officer or director of the Company, who is employed by the
Company or a parent or subsidiary thereof is referred to herein as an
"Employee," and any person or entity, including an officer or director of the
Company, who provides services (other than as an Employee) to the Company or a
parent or subsidiary thereof is referred to herein as a "Non-Employee Service
Provider." Options may be granted under this Plan to any Employee. Nonstatutory
stock options (as defined in subparagraph 5(a) below) also may be granted to any
Non-Employee Service Provider. The Employees and Non-Employee Service Providers
to whom options may be granted pursuant to this paragraph 4 are referred to
herein as "Eligible Participants."
<PAGE>
5. Terms and Conditions of Options.
(a) General. Subject to the terms and conditions of this
Plan, the Committee may, from time to time during the term of this
Plan, grant to such Eligible Participants as the Committee may
determine options to purchase such number of Shares of the Company on
such terms and conditions as the Committee may determine. In
determining the Eligible Participants to whom options shall be granted
and the number of Shares to be covered by each option, the Committee
may take into account the nature of the services rendered by the
respective Eligible Participants, their present and potential
contributions to the success of the Company, and such other factors as
the Committee in its sole discretion may deem relevant. Unless the
Committee specifically directs otherwise, the date and time of approval
by the Committee of the granting of an option shall be considered the
date and the time of the grant of such option. The Committee in its
sole discretion may designate whether an option granted to an Employee
is to be considered an "incentive stock option" (as that term is
defined in Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code"), or any amendment thereto) or a nonstatutory stock option
(an option granted under this Plan that is not intended to be an
"incentive stock option"). The Committee may grant both incentive stock
options and nonstatutory stock options to the same Employee. However,
if an incentive stock option and a nonstatutory stock option are
awarded simultaneously, such options shall be deemed to have been
awarded in separate grants and shall be clearly identified, and in no
event shall the exercise of one such option affect the right to
exercise the other. To the extent that the aggregate Fair Market Value
(as defined in paragraph 7 below) of Shares with respect to which
incentive stock options (determined without regard to this sentence)
are exercisable for the first time by any Employee during any calendar
year (under all plans of the Company and its parent and subsidiary
corporations) exceeds $100,000, such options shall be treated as
nonstatutory stock options. Notwithstanding the foregoing, no incentive
stock option may be granted under this Plan unless this Plan is
approved by the shareholders of the Company within twelve months after
the effective date of this Plan.
(b) Purchase Price. The purchase price of each Share
subject to an option granted pursuant to this paragraph 5 shall be
fixed by the Committee, subject, however, to the remainder of this
subparagraph 5(b). For nonstatutory stock options, such purchase price
shall be no less than 85% of the Fair Market Value of a Share on the
date of grant. For incentive stock options, such purchase price shall
be no less than 100% of the Fair Market Value of a Share on the date of
grant, provided that if such incentive stock option is granted to an
Employee who owns, or is deemed under Section 424(d) of the Code to
own, at the time such option is granted, stock of the Company (or of
any parent or subsidiary of the Company) possessing more than 10% of
the total combined voting power of all classes of stock therein (a "10%
Shareholder"), such purchase price shall be no less than 110% of the
Fair Market Value of a Share on the date of grant.
(c) Vesting. Unless an option is terminated as provided
hereunder, an optionee may exercise his option for up to, but not in
excess of, the amount of shares that have vested according to the
applicable option agreement based on the optionee's number of years of
continuous service with the Company or a parent or subsidiary from the
date on which the option is granted. In the case of an optionee who is
an Employee, continuous service shall mean continuous employment; in
the case of an optionee who is a Non-Employee Service Provider,
continuous service shall mean the continuous provision of services. In
applying said limitations, the amount of shares, if any, previously
purchased by the optionee under the option shall be counted in
determining the amount of shares the optionee can purchase at any time.
The Committee shall be free to specify other terms and conditions in
its discretion.
(d) Termination. Each option granted pursuant to this
paragraph 5 shall expire, and all rights to purchase Shares thereunder
shall terminate, on the earliest of:
(i) ten years after the date such option is granted
(or in the case of an incentive stock option granted to a 10%
Shareholder, five years after the date such option is granted)
or on such date prior thereto as may be fixed by the Committee
on or before the date such option is granted;
<PAGE>
(ii) the expiration of the period after the
termination of the optionee's employment within which the
option is exercisable as specified in paragraph 10(b) or
10(c), whichever is applicable (provided that the Committee
may, in any option agreement provided for in paragraph 6 or by
Committee action with respect to any outstanding option,
extend the periods specified in paragraph 10(b) and 10(c)); or
(iii) the date, if any, fixed for termination or
cancellation pursuant to paragraphs 11 or 12 below.
6. Option Agreements. All options granted under this Plan
shall be evidenced by a written agreement in such form or forms as the Committee
may from time to time determine, which agreement shall, among other things, (i)
designate whether the options being granted thereunder are nonstatutory stock
options or incentive stock options, and (ii) designate the times that the
options granted thereunder shall vest.
7. Fair Market Value. For purposes of this Plan, the "Fair
Market Value" of a Share at a specified date shall, unless otherwise expressly
provided in this Plan, mean the closing sale price of a Share on the date
immediately preceding such date or, if no sale of Shares shall have occurred on
that date, on the next preceding day on which a sale of Shares occurred, on the
Nasdaq National Market or any similar system then in use or, if Shares are not
included in the Nasdaq National Market or any similar system then in use, the
mean between the closing "bid" and the closing "asked" quotation of a Share on
the date immediately preceding the date as of which such Fair Market Value is
being determined, or, if no closing bid or asked quotation is made on that date,
on the next preceding day on which a quotation is made, on the Nasdaq SmallCap
Market or any similar system then in use, provided that if the Shares in
question are not quoted on any such system, Fair Market Value shall be what the
Committee determines in good faith to be 100% of the fair market value of a
Share as of the date in question. Notwithstanding anything stated in this
paragraph 7, if the applicable securities exchange or system has closed for the
day by the time the determination is being made, all references in this
paragraph to the date immediately preceding the date in question shall be deemed
to be references to the date in question.
8. Manner of Exercise. A person entitled to exercise an option
granted under this Plan may, subject to its terms and conditions and the terms
and conditions of this Plan, exercise it in whole at any time, or in part from
time to time, by delivery to the Company at its principal executive office, to
the attention of its Secretary, of written notice of exercise, specifying the
number of Shares with respect to which the option is being exercised. The
purchase price of the Shares with respect to which an option is being exercised
shall be payable in full at the time of exercise, provided that, to the extent
permitted by law, the holder of an option may simultaneously exercise an option
and sell all or a portion of the Shares thereby acquired pursuant to a brokerage
or similar relationship and use the proceeds from such sale to pay the purchase
price of such Shares. The purchase price of each Share on the exercise of any
option shall be paid in full in cash (including check, bank draft or money
order) or, at the discretion of the person exercising the option, by delivery to
the Company of unencumbered Shares, by a reduction in the number of Shares
delivered upon exercise of the option, or by a combination of cash and such
Shares (in each case such Shares having an aggregate Fair Market Value on the
date of exercise equal to the amount of the purchase price being paid through
such delivery or reduction of Shares); provided, however, that no person shall
be permitted to pay any portion of the purchase price with Shares if, in the
opinion of the Committee, payment in such manner could have adverse financial
accounting consequences for the Company. The granting of an option to a person
shall give such person no rights as a shareholder except as to Shares issued to
such person.
9. Tax Withholding. Delivery of Shares upon exercise of any
nonstatutory stock option granted under this Plan shall be subject to any
required withholding taxes. A person exercising such an option may, as a
condition precedent to receiving the Shares, be required to pay the Company a
cash amount equal to the amount of any required withholdings. In lieu of all or
any part of such a cash payment, the Committee may, but shall not be required
to, provide in any option agreement provided for in paragraph 6 (or provide by
Committee action with respect to any outstanding option) that a person
exercising an option may cover all or any part of the required withholdings, and
any additional withholdings up to the amount needed to cover the individual's
full FICA and federal, state and local income tax liability with respect to
income arising from the exercise of the option, through the delivery to the
Company of unencumbered Shares, through a reduction in the number of Shares
delivered to the person exercising the option or through a subsequent return to
the Company of Shares delivered to the person exercising the option (in each
case, such Shares having an aggregate Fair Market Value on the date of exercise
equal to the amount of the withholding taxes being paid through such delivery,
reduction or subsequent return of Shares).
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10. Transferability and Termination of Employment.
(a) Transferability. During the lifetime of an optionee,
only such optionee or his or her guardian or legal representative may
exercise options granted under this Plan. No option granted under this
Plan shall be assignable or transferable by the optionee otherwise than
by will or the laws of descent and distribution.
(b) Termination of Employment During Lifetime. During
the lifetime of an optionee, an option may be exercised only while the
optionee is employed by the Company or by a parent or subsidiary
thereof, and only if such optionee has been continuously so employed
since the date the option was granted, except that:
(i) an option shall continue to be exercisable
for three months after termination of the optionee's
employment but only to the extent that the option was
exercisable immediately prior to such optionee's termination
of employment; and
(ii) in the case of an optionee who is disabled
(as hereinafter defined) while employed, such optionee or his
or her legal representative may exercise the option within one
year after termination of such optionee's employment.
(c) Termination Upon Death. With respect to an optionee
whose employment terminates by reason of death, any option held by such
optionee at the time of death may be exercised by such optionee's legal
representatives, heirs or legatees, but only within one year after the
death of such optionee.
(d) Vesting Upon Disability or Death. In the event of
the disability (as hereinafter defined) or death of an optionee, any
option or portion thereof held by such individual or his or her legal
representative that was not previously exercisable shall become
immediately exercisable in full if the disabled or deceased individual
shall have been continuously employed by the Company or a parent or
subsidiary thereof between the date such option was granted and the
date of such disability or death. "Disability" of an optionee shall
have the meaning given to such term in Section 22(e)(3) of the Code.
"Disabled," with respect to any optionee, shall mean that such optionee
has incurred a disability.
(e) Transfers and Leaves of Absence. Neither the
transfer of employment of a person to whom an option is granted between
any combination of the Company and a parent or subsidiary thereof, nor
a leave of absence granted to such person and approved by the
Committee, shall be deemed a termination of employment for purposes of
this Plan. The terms "parent" and "subsidiary" as used in this Plan
shall have the meanings ascribed to "parent corporation" and
"subsidiary corporation" respectively in Sections 424(e) and (f) of the
Code.
(f) Right to Terminate Employment. Nothing contained in
this Plan, or in any option granted pursuant to this Plan, shall confer
upon any optionee holding an option any right to continued employment
by the Company or any parent or subsidiary of the Company or limit in
any way the right of the Company or any such parent or subsidiary to
terminate such optionee's employment at any time.
(g) Expiration Date. In no event shall any option be
exercisable at any time after the time it shall have expired in
accordance with paragraph 5(d) of this Plan. When an option is no
longer exercisable, it shall be deemed to have lapsed or terminated and
will no longer be outstanding.
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11. Acquisition. In the event that an Acquisition occurs with
respect to the Company, the Company shall have the right, but not the
obligation, to cancel options outstanding as of the effective date of
Acquisition, whether or not such options are then exercisable, in return for
payment to the optionees of an amount equal to a reasonable estimate of an
amount (hereinafter the "Spread") equal to the difference between the net amount
per share payable in the Acquisition, or as a result of the Acquisition, less
the exercise price of the option. In estimating the Spread, appropriate
adjustments to give effect to the existence of the options shall be made, such
as deeming the options to have been exercised, with the Company receiving the
exercise price payable thereunder, and treating the shares receivable upon
exercise of the options as being outstanding in determining the net amount per
share. For purposes of this section, an "Acquisition" shall mean any transaction
in which substantially all of the Company's assets are acquired or in which a
controlling amount of the Company's outstanding shares are acquired, in each
case by a single person or entity or an affiliated group of persons and/or
entities. For purposes of this section a controlling amount shall mean more than
fifty percent (50%) of the issued and outstanding shares of Stock of the
Company. The Company shall have such a right regardless of how the Acquisition
is effectuated, whether by direct purchase, through a merger or similar
corporate transaction, or otherwise. In cases where the acquisition consists of
the acquisition of assets of the Company, the net amount per share shall be
calculated on the basis of the net amount receivable with respect to shares upon
a distribution and liquidation by the Company after giving effect to expenses
and charges, including, but not limited to, taxes payable by the Company before
the liquidation can be completed.
Where the Company does not exercise its right under this paragraph 11,
the provisions of paragraph 12 shall govern, to the extent applicable.
12. Dissolution, Liquidation, Merger.
(a) Merger or Consolidation. Subject to any required
action by the stockholders, if the Company shall be the surviving
corporation in any merger or consolidation, any option granted
hereunder shall pertain to and apply to the securities to which a
holder of the number of Shares subject to the option would have been
entitled in such merger or consolidation.
(b) Other Transactions. A dissolution or a liquidation of
the Company or a merger and consolidation in which the Company is not
the surviving corporation shall cause every option outstanding
hereunder to terminate as of the effective date of such dissolution,
liquidation, merger, or consolidation. However, the optionee either (i)
shall be offered a firm commitment whereby the resulting or surviving
corporation in a merger or consolidation will tender to the optionee an
option (the "Substitute Option") to purchase its shares on terms and
conditions both as to number of shares and otherwise, which will
substantially preserve to the optionee the rights and benefits of the
option outstanding hereunder granted by the Company, or (ii) shall have
the right immediately prior to such dissolution, liquidation, merger or
consolidation to exercise any unexercised options whether or not then
vested, subject to the provisions of this Plan. The Committee shall
have absolute and uncontrolled discretion to determine whether the
optionee has been offered a firm commitment and whether the tendered
Substitute Option will substantially preserve to the optionee the
rights and benefits of the option outstanding hereunder. In any event,
any Substitute Option for an incentive stock option shall comply with
the requirements of Section 424(a) of the Code. All provisions of this
Plan applicable to options shall also apply to Substitute Options.
13. Adjustments. In the event of any reorganization, merger,
consolidation, recapitalization, liquidation, reclassification, stock dividend,
stock split, combination of shares, rights offering, or extraordinary dividend
or divestiture (including a spin-off), or any other change in the corporate
structure or Shares of the Company, the Committee (or if the Company does not
survive any such transaction, a comparable committee of the Board of Directors
of the surviving corporation) may, without the consent of any optionee, make
such adjustment as it determines in its discretion to be appropriate as to the
number and kind of securities subject to and reserved under this Plan and, in
order to prevent dilution or enlargement of rights of participants in this Plan,
the number and kind of securities issuable upon exercise of outstanding options
and the exercise price thereof.
14. Stock Appreciation Rights. The Committee may, under such
terms and conditions as it deems appropriate, and in its sole discretion,
authorize the surrender by an optionee who is not a director of the Company,
<PAGE>
unless such person is also an Employee of the Company, of all or part of an
unexercised option and authorize a payment in consideration thereof of an amount
equal to the difference obtained by subtracting the exercise price of the Shares
then subject to exercise under such option from the fair market value of the
stock represented by such Shares on the date of surrender, provided that the
Committee determines that such settlement is consistent with the purpose of the
Plan and provided, further, that no such right shall be exercisable during the
six (6) month period following the grant thereof. Such payment may be made in
Shares valued at their fair market value on the date of surrender of such option
or in cash, or partly in Shares and partly in cash. Acceptance of such surrender
and the manner of payment shall be in the discretion of the Committee.
15. Compliance With Legal Requirements.
(a) General. No certificate for Shares distributable
under this Plan shall be issued and delivered unless the issuance of
such certificate complies with all applicable legal requirements
including, without limitation, compliance with the provisions of
applicable state securities laws, the Securities Act of 1933, as
amended, and the Exchange Act.
(b) Rule 16b-3. With respect to Section 16 Individuals,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange Act. To
the extent any provision of this Plan or action by the Committee fails
to so comply, it shall be deemed null and void, to the extent permitted
by law and deemed advisable by the Committee.
16. Governing Law. To the extent that federal laws do not
otherwise control, this Plan and all determinations made and actions taken under
this Plan shall be governed by the laws of the State of Colorado and construed
accordingly.
17. Amendment and Discontinuance of Plan. The Board may at
any time amend, suspend or discontinue this Plan; provided, however, that no
amendment to this Plan shall, without the consent of the holder of the option,
alter or impair any option previously granted under this Plan. To the extent
considered necessary to comply with Exchange Act Rule 16b-3 or applicable
provisions of the Code, any such amendments to this Plan may be made subject to
approval by the shareholders of the Company.
18. Term.
(a) Effective Date. This Plan shall be effective as of
August 16, 1996.
(b) Termination. This Plan shall remain in effect until
(i) all Shares subject to it are distributed or (ii) this Plan is
terminated under paragraph 17 above. No award of an incentive stock
option shall be made under this Plan more than ten years after the
effective date of this Plan (or such other limit as may be required by
the Code) if such limitation is necessary to qualify the option as an
incentive stock option.
19. No Obligation to Exercise. The granting of an option
shall impose no obligation upon the holder thereof to exercise such option.