<PAGE>
As filed with the Securities and Exchange Commission on December 30, 1997
File No.333-_________________
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
CITATION CORPORATION
(Exact name of issuer as specified in its charter)
DELAWARE 63-0828225
(State or Other Incorporation or (IRS Employer
Jurisdiction of Organization) Identification No.)
Citation Corporation
2 Office Park Circle, Suite 204
Birmingham, Alabama 35223
(205)871-5731
(Address, and telephone number, of issuer's principal executive offices)
CITATION CORPORATION
1994 INCENTIVE AWARD PLAN
(Full Title of Plan)
T. Morris Hackney, Chairman
2 Office Park Circle, Suite 204
Birmingham, Alabama 35223
(205)871-5731
(Name and address and telephone number, including area code,
of agent for service)
Copies to
CAROLYN L. DUNCAN, ESQ.
Ritchie & Rediker, L.L.C.
312 North 23rd Street
Birmingham, Alabama 35203
(205) 251-1288
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
Amount Proposed maximum Proposed maximum Amount of
Title of Securities to be offering price aggregate registration fee
to be Registered Registered per share offering price (1)
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$.01 per share 1,000,000 $16.1875 $16,187,500 $4,905.30
- --------------------------------------------------------------------------------------------------
</TABLE>
================================================================================
(1) Determined in accordance with Rule 457(h) under the Securities Act of 1933,
based on $16.1875, the average of the high and low sale prices quoted
on the NASDAQ National Market System on December 26, 1997.
================================================================================
Total Number of Sequential Pages: 17
---------
Exhibit Index Appears on Sequential Page: 7
-----
<PAGE>
Pursuant to General Instruction E of Form S-8, the contents of Citation
Corporation's Registration Statement on Form S-8 (No. 33-93630) are hereby
incorporated herein by reference. In addition, the following information is
included herein:
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents are incorporated by reference into this
Registration Statement and are deemed to be a part hereof from the date of the
filing of such documents:
(1) The Registrant's Annual Report on Form 10-K for its fiscal year ended
September 28, 1997.
(2) All reports filed by the Registrant pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange
Act") since September 28, 1997.
(3) The description of Common Stock contained in the Registrant's
registration statement on Form 8-A, including all amendments or
reports filed for the purpose of updating such description.
(4) All other documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the
filing of a post-effective amendment which indicates that all
securities offered pursuant to this Registration Statement have been
sold or which deregisters all securities that remain unsold.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Registrant's Certificate of Incorporation (the "Certificate")
eliminates, subject to certain exceptions, the personal liability of directors
to the Registrant or its stockholders for monetary damages for breaches of
fiduciary duties as directors. The Certificate does not provide for the
elimination of or limitation on the personal liability of a director for (i) any
breach of the director's duty of loyalty to the Registrant or its stockholders,
(ii) acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) certain unlawful dividends or redemptions
as provided under Section 174 of the Delaware General Corporation Law, or (iv)
any transaction from which the director derived an improper personal benefit.
This
2
<PAGE>
provision of the Certificate will limit the remedies available to a stockholder
in the event of breaches of any director's duties to such stockholder or the
Registrant.
Under Section 145 of the Delaware General Corporation Law, a corporation
may indemnify a director, officer, employee or agent of the corporation (or
other entity if such person is serving in such capacity at the corporation's
request) against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him if he acted
in good faith and in a manner he reasonably believed to be in, or not opposed to
the best interests of the corporation and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. ln
the case of an action brought by or in the right of a corporation, the
corporation may indemnify a director, officer, employee or agent of the
corporation (or other entity if such person is serving in such capacity at the
corporation's request) against expenses (including attorneys' fees) actually and
reasonably incurred by him if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person is fairly and reasonably entitled
to indemnification for such expenses as the court shall deem proper. The
Registrant's Bylaws provide that expenses (including attorneys' fees) incurred
by an officer or director in defending any civil, criminal, administrative or
investigative action, suit or proceeding shall be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Registrant.
ITEM 8. EXHIBITS
The exhibits included as part of this Registration Statement are as
follows:
Exhibit Number Description
- -------------- -----------
4(a) Certificate of Incorporation (included as Exhibit 3.1 to the
Registrant's registration statement on Form S-1 filed with
the Commission on June 3, 1994 and incorporated herein by
reference)
4(b) Bylaws (included as Exhibit 3.2 to the Registrant's
registration statement on Form S-1 filed with the Commission
on June 3, 1994 and incorporated herein by reference)
5(a) & 23(a) Opinion and Consent of Counsel to Registrant
23(b) Consent of Independent Accountants
99(b) Citation Corporation 1994 Incentive Award Plan, as amended
3
<PAGE>
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 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; (2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; (3) to remove from registration by means of a post-
effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (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 therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned Registrant hereby undertakes to deliver or cause
to be delivered with the prospectus, to each person to whom the prospectus is
sent or given, the latest annual report to security holders that is incorporated
by reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Birmingham, State of Alabama on December 29, 1997.
CITATION CORPORATION
/s/ T. Morris Hackney
-----------------------------
By: T. Morris Hackney
Chief Executive Officer
and Chairman of the Board
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints T. Morris Hackney as attorney-in-fact, having the
power of substitution, for him in any and all capacities, to sign any amendments
to this Registration Statement on Form S-8 and to file the same, with exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that said attorney-in-
fact, or his substitute or substitutes, may 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.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ T. Morris Hackney Chief Executive Officer, December 29, 1997
- ---------------------------- and Chairman of the Board
T. MORRIS HACKNEY (Principal Executive Officer)
/s/ Frederick F. Sommer President and Chief Operating December 29, 1997
- ---------------------------- Officer
FREDERICK F. SOMMER
/s/ R. Conner Warren Executive Vice President of December 29, 1997
- ---------------------------- Finance and Administration,
R. CONNER WARREN Treasurer and Director
(Principal Financial Officer)
/s/ Thomas W. Burleson Vice President - Corporate December 29, 1997
- ---------------------------- Controller (Principal Accounting
THOMAS W. BURLESON Officer)
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Hugh G. Weeks Director December 29, 1997
- ----------------------------
HUGH G. WEEKS
/s/ A. Derrill Crowe Director December 29, 1997
- ----------------------------
A. DERRILL CROWE
/s/ Franklyn Esenberg Director December 29, 1997
- ----------------------------
FRANKLYN ESENBERG
/s/ William W. Featheringill Director December 29, 1997
- ----------------------------
WILLIAM W. FEATHERINGILL
/s/ Frank B. Kelso, II Director December 29, 1997
- ----------------------------
FRANK B. KELSO, II
/s/ Van L. Richey Director December 29, 1997
- ----------------------------
VAN L. RICHEY
</TABLE>
6
<PAGE>
EXHIBIT INDEX
TO
REGISTRATION STATEMENT ON FORM S-8
Exhibit Number Description
- -------------- -----------
5(a) & 23(a) Opinion and Consent of Counsel to Registrant
23(b) Consent of Independent Accountants
99(b) Citation Corporation 1994 Incentive Award Plan, as amended
7
<PAGE>
EXHIBIT 5(A) & 23(A)
RITCHIE & REDIKER, L.L.C.
Attorneys At Law
312 North 23rd Street
Birmingham, Alabama 35203
205-251-1288
Carolyn L. Duncan Facsimile
205-324-7832
December 29, 1997
Citation Corporation
2 Office Park Circle
Suite 204
Birmingham, Alabama 35223
Re: Form S-8 Registration Statement
Citation Corporation 1994 Incentive Award Plan
Gentlemen:
We have acted as counsel for Citation Corporation, a Delaware corporation
(the "Company"), in connection with the registration on Form S-8 of up to
1,000,000 shares of the Company's common stock, $.01 par value (the "Common
Stock") to be issued pursuant to and in accordance with the terms of the
Company's 1994 Incentive Award Plan, as amended (the "Plan"). We have examined
certificates of public officials and originals or copies of such corporate
records, documents and other instruments relating to the authorization and
issuance of such shares of Common Stock pursuant to the Plan as we have deemed
relevant under the circumstances.
On the basis of the foregoing, it is our opinion that:
1. The Company was duly organized and incorporated and is validly existing
under the laws of the State of Delaware, with an authorized capitalization
consisting of 35,000,000 shares, divided into 30,000,000 shares of Common Stock,
par value $.01 per share, and 5,000,000 shares of Preferred Stock, par value
$1.00 per share.
2. The proposed offer and sale pursuant to the Plan of up to 1,000,000
shares of Common Stock have been duly authorized by the Board of Directors of
the Company, and such shares, when issued in accordance with the terms and
conditions of the Plan, will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to said
Registration Statement.
Yours very truly,
RITCHIE & REDIKER, L.L.C.
By: /s/ Carolyn L. Duncan
----------------------
Carolyn L. Duncan, Esq.
<PAGE>
EXHIBIT 23(B)
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-8 of our report dated November 17, 1997 on our audits of the financial
statements of Citation Corporation and subsidiaries as of September 28, 1997 and
September 29, 1996 and for the years ended September 28, 1997, September 29,
1996 and October 1, 1995, which report is included in the Annual Report on Form
10-k for the fiscal year ended September 28, 1997.
COOPERS & LYBRAND L.L.P.
/s/ Coopers & Lybrand L.L.P.
Birmingham, Alabama
December 29, 1997
<PAGE>
EXHIBIT 99(B)
CITATION CORPORATION
INCENTIVE AWARD PLAN
As amended
by Resolution adopted by the Board of Directors on August 15, 1996
and approved by the shareholders February 18, 1997
1. PURPOSE.
The purposes of the 1994 Incentive Award Plan (the "Plan") are to provide
long-term incentives and rewards to those employees largely responsible for the
success and growth of Citation Corporation and its subsidiaries and divisions
(the "Company"), to assist the Company in attracting and retaining executives
with experience and ability on a basis competitive with industry practices, and
to associate the interests of such key employees with those of the Company's
shareholders.
2. ADMINISTRATION OF THE PLAN.
(a) Committee. The Plan shall be administered by the Compensation
Committee of the Board of Directors of the Company (the "Committee"). The Board
of Directors shall appoint at least two of its members to the Committee. Except
as may otherwise be provided in Rule 16b-3 of the Securities Exchange Act of
1934, as amended (the "1934 Act"), no person shall be appointed as a member of
the Committee who is not "disinterested" as defined in Rule 16b-3 of the 1934
Act.
Notwithstanding the foregoing, it is hereby acknowledged that prior to the
registration of the Common Stock, $.01 par value, of the Company ("Common
Stock") under the 1934 Act, the Board of Directors shall serve as the Committee.
(b) Committee Actions. Each member of the Committee shall serve at the
pleasure of the Board of Directors, which may fill any vacancy, however caused,
in the Committee. The Committee shall select one of its members as a chairman
and shall hold meetings at the times and in the places as it may deem advisable.
All actions the Committee takes shall be made by majority decision. Any action
evidenced by a written instrument signed by all of the members of the Committee
shall be as fully effective as if the Committee had taken the action by majority
vote at a meeting duly called and held.
(c) Committee Powers. The Committee shall have all the powers vested in
it by the terms of the Plan, such powers to include exclusive authority (within
the limitations described herein) to (i) select the employees to be granted
awards under the Plan ("Participants"), (ii) determine the type, size and terms
of awards to be made to each Participant, including whether
<PAGE>
or not such awards shall be issued for any consideration and, if issued for
consideration, the amount and type of consideration, (iii) determine the
consideration to be paid upon exercise of an ISO or NSO, as defined herein, (iv)
determine the time when awards will be granted and (v) establish objectives and
conditions for awards, including any holding period for awards or securities
awarded, the effects of termination of employment or disability on awards,
vesting requirements and the form of payment of awards. The Committee may, in
its sole discretion, delegate such of its powers as it deems appropriate, except
that the Committee may not delegate its authority with regard to any matter or
action affecting an officer or other person subject to Section 16 of the 1934
Act.
(d) The Committee shall have full power and authority to administer and
interpret the Plan and to adopt such rules, regulations, agreements, guidelines
and instruments for the administration of the Plan and for the conduct of its
business as the Committee deems necessary or advisable. The Committee's
interpretations of the Plan, and all actions taken and determinations made by
the Committee pursuant to the powers vested in it hereunder, shall be conclusive
and binding on all parties concerned, including the Company, its shareholders
and any employee of the Company.
3. ELIGIBILITY.
(a) Active full-time and part-time key employees of the Company, its
subsidiaries and divisions, whether or not directors of the Company, shall be
eligible to participate in the Plan; directors of the Company who are not
employees are not eligible. The Committee, or its delegate, shall designate
Participants from among such eligible key employees.
(b) Subject to the limits set forth in this Plan, the Committee at any
time may grant additional awards to Participants to whom the Committee had
previously granted awards, so that a Participant may hold more than one award at
the same time.
4. AWARDS.
(a) Types. The Committee may authorize awards under the Plan of any one
or a combination of: nonqualified stock options ("NSO"), incentive stock options
("ISO"), stock appreciation rights ("SAR"), and restricted stock. The Committee
may make any other type of award which it shall determine is consistent with the
objectives and limitations of the Plan. All Incentive Stock Options ("ISOs")
awarded hereunder are intended to comply with Internal Revenue Code of 1986, as
amended ("Code"), Sections 422 and 424 and all provisions of the Plan and all
ISOs granted shall be construed to effectuate that intent. Each award shall be
subject to the terms and conditions set forth herein and as determined by the
Committee. Committee determinations as to eligibility, form, amount and timing
of awards, and other terms and conditions need not be uniform and may be made
selectively among Participants who receive or are eligible for awards hereunder,
whether or not such individuals are similarly situated.
(b) Guidelines. The Committee may adopt from time to time policies for
its
11
<PAGE>
implementation of the Plan. Such policies may include, but need not be limited
to, the type, size and term of awards to be made to Participants who are
eligible key employees and the conditions for payment of such awards. All awards
shall be evidenced by a written agreement between the Participant and the
Company in the form and containing the terms and conditions authorized by the
Committee.
(c) Maximum Awards. A Participant may be granted multiple awards under
the Plan but no one Participant may be granted, in the aggregate, awards that
would result in his or her receiving more than 10% of the maximum number of
shares of Common Stock available for award under the Plan.
5. TERMS OF STOCK OPTIONS.
The Committee may grant options qualifying as ISOs under the Code and NSOs
(collectively "Stock Options"), and such Stock Options shall be subject to the
following terms and conditions and such other terms and conditions as the
Committee may prescribe:
(a) Option Price. The option price per share with respect to each Stock
Option shall be determined by the Committee, but shall not be less than 100% of
the fair market value of the Common Stock on the date the Stock Option is
granted, as determined by the Committee. Unless otherwise determined by the
Committee, fair market value shall be deemed to be the mean between the highest
and lowest sales prices of the Common Stock on the Consolidated Transaction
Reporting System on the date the Stock Option is granted.
(b) Period of Option. The period of each Stock Option shall be fixed by
the Committee.
(c) Payment. The option price shall be payable at the time the Stock
Option is exercised in cash or, at the discretion of the Committee, in whole or
in part in the form of shares of Common Stock already owned by the grantee
(based on the fair market value of the Common Stock on the date the option is
exercised as determined by the Committee). No shares shall be issued until full
payment therefor has been made. A grantee of a Stock Option shall have none of
the rights of a stockholder until the shares are issued.
(d) Exercise of Option. The shares covered by a Stock Option may be
purchased in such installments and on such exercise dates as the Committee may
determine. Any shares not purchased on the applicable exercise date may be
purchased thereafter at any time prior to the final expiration of the Stock
Option. In no event (including those specified in paragraphs (e), (f) and (g) of
this section below) shall any Stock Option be exercisable after its specified
expiration period.
(e) Termination of Employment. Upon the termination of a Participant's
employment (for any reason other than retirement, death or termination for
deliberate, willful, or gross misconduct), Stock Option privileges for such
Participant shall be limited to the shares that were immediately exercisable at
the date of such termination. The Committee, however, in its discretion
12
<PAGE>
may provide that any Stock Options outstanding but not yet exercisable upon the
termination of a Participant's employment may become exercisable in accordance
with a schedule to be determined by the Committee. Such Stock Option privileges
shall expire unless exercised within such period of time after the date of such
termination of employment as may be established by the Committee. If a
Participant's employment is terminated for deliberate, willful or gross
misconduct, as determined by the Company, all rights under the Stock Option
shall expire upon receipt of the notice of such termination.
(f) Retirement. Upon retirement of the Participant, Stock Option
privileges for such Participant shall apply to those shares immediately
exercisable at the date of retirement. The Committee, however, in its
discretion, may provide that any Stock Options outstanding but not yet
exercisable upon the retirement of the Participant may become exercisable in
accordance with a schedule to be determined by the Committee. Stock Option
privileges shall expire unless exercised within such period of time as may be
established by the Committee.
(g) Death. Upon the death of a Participant, Stock Option privileges for
such Participant shall apply to those shares that were immediately exercisable
at the time of death. The Committee, however, in its discretion, may provide
that any Stock Options outstanding but not yet exercisable upon the death of a
Participant may become exercisable in accordance with a schedule to be
determined by the Committee. Such privileges shall expire unless exercised by
legal representatives within a period of time as determined by the Committee but
in no event later than the date of the expiration of the Stock Option.
(h) Limits on Incentive Stock Options. Except as may otherwise be
permitted by the Code, the Committee shall not grant, in the aggregate under all
plans of the Company, a Participant ISOs that are first exercisable during any
one calendar year to the extent that the aggregate fair market value of the
Common Stock with respect to which such ISOs are granted, at the time the ISOs
are granted, exceeds $100,000.
6. TERMS OF STOCK APPRECIATION RIGHTS
The Committee may, in its discretion, grant a stock appreciation right to
receive the appreciation in the fair market value of shares of Common Stock
("SAR") either singly or in combination with an underlying Stock Option granted
hereunder. Such SARs shall be subject to the following terms and conditions and
such other terms and conditions as the Committee may prescribe:
(a) Time and Period of Grant. If an SAR is granted with respect to an
underlying Stock Option, it may be granted at the time of the Stock Option grant
or at any time thereafter but prior to the expiration of the Stock Option grant.
If an SAR is granted with respect to an underlying Stock Option, at the time the
SAR is granted the Committee may limit the exercise period for such SAR, before
and after which period no SAR shall attach to the underlying Stock Option. In no
event shall the exercise period for an SAR granted with respect to an underlying
13
<PAGE>
Stock Option exceed the exercise period for such Stock Option. If an SAR is
granted without an underlying Stock Option, the period of exercise of the SAR
shall be set by the Committee.
(b) Value of SAR. If an SAR is granted with respect to an underlying
Stock Option, the Participant will be entitled to surrender the Stock Option
which is then exercisable and receive in exchange therefor an amount equal to
the excess of the fair market value of the Common Stock on the date the election
to surrender is received by the Company over the Stock Option price multiplied
by the number of shares covered by the Stock Options which are surrendered. If
an SAR is granted without an underlying Stock Option, the Participant will
receive upon exercise of the SAR an amount equal to the excess of the fair
market value of the Common Stock on the date the election to surrender such SAR
is received by the Company over the fair market value of the Common Stock on the
date of grant multiplied by the number of shares covered by the grant of the
SAR.
(c) Payment of SAR. Payment of an SAR shall be in the form of shares of
Common Stock, cash, or a combination thereof. The form of payment upon exercise
of an SAR shall be determined by the Committee either at the time of grant of
the SAR or at the time of exercise of the SAR.
7. TERMS OF RESTRICTED STOCK.
The Committee may issue shares of Common Stock to a Participant which
shares shall be subject to the following terms and conditions and such other
terms and conditions as the Committee may prescribe for the award of restricted
stock ("RS"):
(a) Requirement of Employment. A Participant awarded an RS must remain in
the employment of the Company during a period designated by the Committee
("Restriction Period"). If the Participant leaves the employment of the Company
prior to the end of the Restriction Period, the RS shall terminate and the
shares of Common Stock shall be returned immediately to the Company; provided
that the Committee may, at the time of the grant, provide for the employment
restriction to lapse with respect to a portion of the RS at different times
during the Restriction Period. The Committee may, in its discretion, also
provide for such complete or partial exceptions to the employment restriction as
it deems equitable.
(b) Restrictions on Transfer and Legend of Stock Certificates. During the
Restriction Period, the Participant may not sell, assign, transfer, pledge, or
otherwise dispose of the shares of Common Stock. Each certificate for shares of
Common Stock issued hereunder shall contained a legend giving appropriate notice
of the restrictions in the grant.
(c) Custody of Certificates. The Committee may require, under such terms
and conditions as it deems appropriate or desirable, that the certificates for
shares of Common Stock delivered under the Plan may be held in custody by a bank
or other institution, or that the Company may itself hold such shares in custody
until the Restriction Period expires or until
14
<PAGE>
restrictions thereon otherwise lapse, and may require, as a condition of any
award of RS that the Participant shall have delivered a stock power endorsed in
blank relating to the RS.
(d) Lapse of Restrictions. All restrictions imposed under the RS shall
lapse upon the expiration of the Restriction Period if the conditions as to
employment set forth above have been met. The Participant shall then be entitled
to have the legend removed from the certificates.
(e) Dividends. The Committee shall, in its discretion, at the time of the
award of RS, provide that any dividends declared on the Common Stock during the
Restriction Period shall either be (i) paid to the Participant, or (ii)
accumulated for the benefit of the Participant and paid to the Participant only
after the expiration of the Restriction Period.
8. SHARES OF STOCK SUBJECT TO THE PLAN.
(a) Aggregate Shares. The shares that may be delivered or purchased under
the Plan shall not exceed an aggregate of 1,750,000 shares of Common Stock.
Shares to be delivered or purchased under the Plan may be either shares of
authorized but unissued Common Stock or treasury shares.
(b) Annual Maximum. On and after August 15, 1996, no more than 200,000
shares of Common Stock shall, in any fiscal year, be first available for award
in any such year, so that awards for shares that may be delivered or purchased
under the Plan shall not during any fiscal year exceed an aggregate of 200,000
shares of Common Stock in addition to the shares theretofore available. It is
the intent of this provision that in the event awards for fewer than 200,000
shares are made in any year, the remainder shall thereafter be available for
award, together with any shares available for grant prior to August 15, 1996 and
any shares that become available pursuant to section 8 (c) hereafter.
(c) Reacquired Shares. In the event of a lapse, expiration, termination
or cancellation of any award granted under the Plan without the issuance of
shares or payment of cash, or if shares are issued as RS hereunder and are
reacquired by the Company pursuant to rights reserved upon the issuance thereof,
the shares subject to or reserved for such award may again be used for new
awards hereunder; provided that in no event may the number of shares issued
hereunder exceed the total number of shares reserved for issuance.
9. DILUTION AND OTHER ADJUSTMENTS.
In the event of any change in the outstanding shares of Common Stock by
reason of any split, stock dividend, recapitalization, merger, consolidation,
combination or exchange of shares or other similar corporate change, such
equitable adjustments shall be made in the Plan and the awards thereunder as the
Committee determines are necessary and appropriate, including, if necessary, an
adjustment in the maximum number or kind of shares subject to the Plan or which
may be or have been awarded to any Participant. Such adjustment shall be
conclusive and binding for all purposes of the Plan.
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10. MISCELLANEOUS PROVISIONS.
(a) Rights as Shareholder. A Participant under the Plan shall have no
rights as a holder of Common Stock with respect to awards of Stock Options or
SARs hereunder, unless and until certificates for shares of Common Stock are
issued to the Participant.
(b) Assignment or Transfer. No awards under the Plan or any rights or
interests therein shall be assignable or transferable by a Participant except by
will or the laws of descent and distribution. During the lifetime of a
Participant, awards hereunder are exercisable only by, and payable only to, the
Participant or if the Participant is disabled, by the participant's duly
appointed guardian or legal representative.
(c) Requirements for Transfer. No shares of Common Stock shall be issued
or transferred under the Plan until all legal requirements applicable to the
issuance or transfer of such shares have been complied with to the satisfaction
of the Committee. The Committee shall have the right to condition any issuance
of shares of Common Stock made to any Participant upon such Participant's
written undertaking to comply with such restrictions on his subsequent
disposition of such shares as the Committee or the Company shall deem necessary
or advisable as a result of any applicable law, regulation or official
interpretation thereof, and certificates representing such shares may be
legended to reflect any such restrictions.
(d) Withholding Taxes. The Company shall have the right to deduct from
all awards hereunder paid in cash any federal, state, local or foreign taxes
required by law to be withheld with respect to such awards and, with respect to
awards paid in stock or upon exercise of stock options, to require the payment
(through withholding from the participant's salary or otherwise) of any such
taxes. Alternatively, the Company may issue or transfer the number of shares of
Common Stock under an award net of the number of shares sufficient to satisfy
the withholding tax requirements. For withholding tax purposes, the shares of
Common Stock shall be valued on the date the withholding obligation is incurred.
The obligation of the Company to make delivery of awards in cash or Common Stock
shall be subject to currency or other restrictions imposed by any government.
(e) No Rights to Awards. No employee or other person shall have any claim
or right to be granted an award under the Plan.
(f) Compliance with Section 16(b). Transactions under this Plan and each
award to a person subject to Section 16 of the 1934 Act are intended to comply
with Rule 16b-3 (or its successors) under the 1934 Act, and the Committee shall
impose such minimum holding periods, requirements on the timing of elections and
other restrictions on any award as it may deem needed for such compliance. To
the extent any provision of this Plan, agreements entered into pursuant thereto
or any action by the Committee fails to comply with Rule 16b-3 (or its
successors) under the 1934 Act, it shall be deemed null and void, to the extent
permitted by law and deemed advisable by the Committee.
(g) Costs and Expenses. The cost and expenses of administering the Plan
shall be borne
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by the Company and not charged to any award nor to any Participant receiving an
award.
(h) The Right of the Company to Terminate Employment. No provision in the
Plan or any award shall confer upon any employee any right to continue in the
employment of the Company or any subsidiary or division of the Company or to
continue performing services for or to interfere in any way with the right of
the Company or any subsidiary or division of the Company to terminate his
employment or of the right of shareholders of the Company to remove such
employee or person as a director at any time for any reason.
(i) Approval of Shareholders, etc. The Company shall submit the Plan to
its shareholders for approval within 12 months of the adoption of the Plan by
the Board of Directors; provided further that unless shareholder approval is
obtained within said twelve-month period, both the Plan and all outstanding
awards shall be rendered immediately void and of no effect.
11. AMENDMENTS AND TERMINATION.
The Committee may at any time terminate or from time to time amend the Plan
in whole or in part, but no such action shall adversely affect any rights or
obligations with respect to any awards theretofore made under the Plan.
Unless the holders of at least a majority of the outstanding shares of
Common Stock of the Company shall have first approved thereof, no amendment of
the Plan shall be effective that would increase the maximum number of shares
which may be delivered under the Plan or to any one individual or extend the
maximum period during which awards may be granted under the Plan or make such
other changes in the Plan which would require shareholder approval pursuant to
Rule 16b-3 under the 1934 Act.
With the consent of the Participant affected, the Committee may amend
outstanding agreements evidencing awards under the Plan in a manner not
inconsistent with the terms of the Plan.
12. EFFECTIVE DATE AND TERM OF PLAN.
The Plan shall become effective on the date it is approved by the Board of
Directors of the Company. No awards shall be made under the Plan after December
31, 2003. The Plan will continue in effect for existing awards so long as any
such award is outstanding.
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