Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
ALLEGRO NEW MEDIA, INC.
(Exact name of registrant as specified in its charter)
Delaware 22-3270045
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
#3 Oak Road, Fairfield, NJ 07004
(Address of principal executive offices) (Zip Code)
ALLEGRO NEW MEDIA, INC. OUTSIDE DIRECTOR AND ADVISOR STOCK OPTION PLAN
(Full title of the plan)
Barry A. Cinnamon, President
Allegro New Media, Inc.
#3 Oak Road
Fairfield, New Jersey 07004
(Name and address of agent for service)
(201) 808-1992
(Telephone number, including area code, of agent for service)
copy to:
Neil M. Kaufman, Esq.
Blau, Kramer, Wactlar & Lieberman, P.C.
100 Jericho Quadrangle
Jericho, New York 11753
(516) 822-4820
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
Proposed maximum Proposed maximum
Title of securities Amount to be offering price per aggregate offering Amount of
to be registered registered security (1) price (1) registration fee
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Common Stock,
par value $0.001 500,000 shs.(2) $7.625 $3,812,500 $1,314
per share
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<FN>
(1) Estimated solely for the purpose of calculating the registration fee,
based upon the average of the high and low prices of the Company's Common Stock
reported on NASDAQ on September 26, 1996.
(2) The Registration Statement also covers an indeterminate number of
additional shares of Common Stock which may become issuable pursuant to
anti-dilution and adjustment provisions of the Plan.
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</FN>
</TABLE>
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Registrant hereby incorporates by reference into this Registration
Statement the documents listed in (a) through (c) below:
(a) The Registrant's latest annual report filed pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934, or either
(I) the latest prospectus filed pursuant to Rule 424(b) under the
Securities Act of 1933 that contains audited financial statements
for the Registrant's latest fiscal year for which such statements
have been filed or (II) the Registrant's effective registration
statement on Form 10 filed under the Securities Exchange Act of
1934 containing audited financial statements for the Registrant's
latest fiscal year;
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since the end of the fiscal year
covered by the Registrant document referred to in (a) above;
(c) The description of the class of securities to be offered which is
contained in a registration statement filed under Section 12 of
the Securities Exchange Act of 1934, including any amendment or
report filed for the purpose of updating such description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the
filing of a post-effective amendment which indicates that all securities offered
have been sold or which deregisters all such securities then remaining unsold,
shall be deemed to be incorporated by reference in this Registration Statement
and to be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Under the provisions of the Certificate of Incorporation and By-Laws of
Registrant, each person who is or was a director or officer of Registrant shall
be indemnified by Registrant as of right to the full extent permitted or
authorized by the General Corporation Law of Delaware.
Under such law, to the extent that such person is successful on the merits
of defense of a suit or proceeding brought against him by reason of the fact
that he is a director or officer of Registrant, he shall be indemnified against
expenses (including attorneys' fees) reasonably incurred in connection with such
action.
If unsuccessful in defense of a third-party civil suit or a criminal suit
is settled, such a person shall be indemnified under such law against both (1)
expenses (including attorneys' fees) and (2) judgments, fines and amounts paid
in settlement if he acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interests of Registrant, and with respect
to any criminal action, had no reasonable cause to believe his conduct was
unlawful.
<PAGE>
If unsuccessful in defense of a suit brought by or in the right of
Registrant, or if such suit is settled, such a person shall be indemnified under
such law only against expenses (including attorneys' fees) incurred in the
defense or settlement of such suit if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of
Registrant except that if such a person is adjudicated to be liable in such suit
for negligence or misconduct in the performance of his duty to Registrant, he
cannot be made whole even for expenses unless the court determines that he is
fairly and reasonably entitled to be indemnified for such expenses.
The officers and directors of the Company are covered by officers' and
directors' liability insurance. The policy coverage is $1,500,000, which
includes reimbursement for costs and fees. There is a maximum aggregate
deductible for each loss under the policy of $150,000. The Company has entered
into Indemnification Agreements with each of its officers and directors. The
Agreements provide for reimbursement for all direct and indirect costs of any
type or nature whatsoever (including attorneys' fees and related disbursements)
actually and reasonably incurred in connection with either the investigation,
defense or appeal of a Proceeding, as defined, including amounts paid in
settlement by or on behalf of an Indemnitee.
Item 7. Exemption from registration claimed.
Not applicable.
Item 8. Exhibits.
4 Outside Director and Advisor Stock Option Plan
5 Opinion and consent of Blau, Kramer, Wactlar & Lieberman, P.C.
23.1 Consent of Blau, Kramer, Wactlar & Lieberman, P.C. - included in
their opinion filed as Exhibit 5.
23.2 Consent of Ernst & Young LLP
24 Powers of Attorney.
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To 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;
(iii) 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; provided, however, that paragraphs
(a)(l)(i) and (a)(l)(ii) do not apply if the registration
statement is on Form S-3 or Form 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
Registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
<PAGE>
(2) That, for the purposes 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 the 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 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 policy
as expressed in the 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
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 Fairfield, N.J. on the 26th day of September 1996.
ALLEGRO NEW MEDIA, INC.
By: /s/ Barry A. Cinnamon
Barry A. Cinnamon
Chairman of the Board, President
and Chief Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on September 26, 1996 by the
following persons in the capacities indicated. Each person whose signature
appears below constitutes and appoints Barry A. Cinnamon, with full power of
substitution, our true and lawful attorneys-in-fact and agents to do any and all
acts and things in our name and on our behalf in our capacities indicated below
which they or either of them may deem necessary or advisable to enable Allegro
New Media, Inc. to comply with the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission,
in connection with this Registration Statement including specifically, but not
limited to, power and authority to sign for us or any of us in our names in the
capacities stated below, any and all amendments (including post-effective
amendments) thereto, granting unto said attorneys-in-fact and agents full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in such connection, as fully to all intents and purposes as
we might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or his substitute or substitutes, may lawfully do
or cause to be done by virtue thereof.
Signature Title
/s/ Barry A. Cinnamon Chairman of the Board, President,
Barry A. Cinnamon Chief Executive Officer
(Principal Executive Officer)
/s/ Mark E. Leininger Vice President-Finance, Treasurer
Mark E. Leininger (Chief Financial Officer)
/s/ Marc E. Jaffe Director
Marc E. Jaffe
Director
Eng Chye Low
/s/ George L. Lauro Director
George L. Lauro
/s/ Neil R. Austrian Director
Neil R. Austrian
/s/ Joseph Cirillo Director
Joseph Cirillo
/s/ Gwyn Jones Director
Gwyn Jones
/s/ Lori Kramer Cinnamon Director
Lori Kramer Cinnamon
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Allegro New Media, Inc.
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Form S-8 Registration Statement
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E X H I B I T I N D E X
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Exhibit
Number Exhibit Description
4 Outside Director and Advisor Stock Option Plan
5 Opinion and Consent of Counsel
23.1 Consent of Counsel - see Exhibit 5
23.2 Consent of Ernst & Young LLP
24 Powers of Attorney - see signature page
ALLEGRO NEW MEDIA, INC.
OUTSIDE DIRECTOR AND ADVISOR STOCK OPTION PLAN
1. Purpose. Allegro New Media, Inc. (the "Company") hereby adopts the
Allegro New Media, Inc. Outside Director and Advisor Stock Option Plan (the
"Plan"). The Plan is intended to recognize the contributions made to the Company
by the non-employee members of the Board of Directors and Board of Advisors of
the Company or an Affiliate (as defined below), to provide such persons with
additional incentive to devote themselves to the future success of the Company
or an Affiliate, and to improve the ability of the Company or an Affiliate to
attract, retain, and motivate individuals upon whom the Company's sustained
growth and financial success depend, by providing such persons with an
opportunity to acquire or increase their proprietary interest in the Company
through receipt of options to purchase the Company's Common Stock, par value
$.001 per share (the "Common Stock").
2. Definitions. Unless the context clearly indicates otherwise, the
following terms shall have the following meanings:
(a) "Affiliate" means a corporation which is a parent corporation or a
subsidiary corporation with respect to the Company within the meaning of Section
424(e) or (f) of the Code.
(b) "Board of Directors" or "Board" means the Board of Directors or the
Board of Advisors of the Company.
(c) "Change in Control" shall have the meaning as set forth in Section 9 of
the Plan.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" shall have the meaning set forth in Section 3 of the Plan.
(f) "Company" means Allegro New Media, Inc., a Delaware corporation.
(g) "Disability" shall have the meaning set forth in Section 22(e)(3) of
the Code.
(h) "Fair Market Value" shall have the meaning set forth in Subsection 8(c)
of the Plan.
(i) "Non-qualified Stock Option" means an Option granted under the Plan
which is not intended to qualify, or otherwise does not qualify, as an
"incentive stock option" within the meaning of Section 422(b) of the Code.
(j) "Option" means a Non-qualified Stock Option granted under the Plan.
(k) "Optionee" means a person to whom an Option has been granted under the
Plan, which Option has not been exercised and has not expired or terminated.
(l) "Option Document" means the document described in Section 8 of the
Plan, as applicable, which sets forth the terms and conditions of each grant of
Options.
<PAGE>
(m) "Option Price" means the price at which Shares may be purchased upon
exercise of an Option, as calculated pursuant to Subsection 8(c) of the Plan.
(n) "Outside Director" means a member of the Board of Directors or the
Board of Advisors of the Company who is not an employee of the Company or an
Affiliate.
(o) "Rule 16b-3" means Rule 16b-3 promulgated under the Securities Exchange
Act of 1934, as amended.
(p) "Shares" means the shares of Common Stock of the Company which are the
subject of Options.
3. Administration of the Plan. The Plan shall be administered by the Board
of Directors of the Company; however, the Board of Directors may designate a
committee composed of two or more of its Directors to operate and administer the
Plan in its stead.
(a) Meetings. The Committee shall hold meetings at such times and places as
it may determine. Acts approved at a meeting by a majority of the members of the
Committee or acts approved in writing by the unanimous consent of the members of
the Committee shall be the valid acts of the Committee.
(b) Administration. The interpretation and construction by the Committee of
any provisions of the Plan or of any Option granted under it shall be final,
binding and conclusive.
(c) Exculpation. No member of the Board of Directors shall be personally
liable for monetary damages for any action taken or any failure to take any
action in connection with the administration of the Plan or the granting of
Options under the Plan, provided that this Subsection 3(c) shall not apply to
(i) any breach of such member's duty of loyalty to the Company or its
stockholders, (ii) acts or omissions not in good faith or involving intentional
misconduct or a knowing violation of law, (iii) acts or omissions that would
result in liability under Section 174 of the General Corporation Law of the
State of Delaware, as amended, and (iv) any transaction from which the member
derived an improper personal benefit.
(d) Indemnification. Service on the Committee shall constitute service as a
member of the Board of Directors of the Company. Each member of the Committee
shall be entitled without further act on his or her part to indemnity from the
Company to the fullest extent provided by applicable law and the Company's
Certificate of Incorporation and/or By-laws in connection with or arising out of
any action, suit or proceeding with respect to the administration of the Plan or
the granting of Options thereunder in which he or she may be involved by reason
of his or her being or having been a member of the Committee, whether or not he
or she continues to be such member of the Committee at the time of the action,
suit or proceeding.
4. Grants under the Plan. Grants under the Plan may only be in the form of
a Non-qualified Stock Option.
5. Eligibility. All Outside Directors shall be eligible to receive Options
hereunder. The Committee, in its sole discretion, shall determine whether an
individual is eligible to receive Options under the Plan.
6. Shares Subject to Plan. The aggregate maximum number of Shares for which
Options may be granted pursuant to the Plan is five hundred thousand (500,000),
subject to adjustment as provided in Section 10 of the Plan. The Shares shall be
issued from authorized and unissued Common Stock or Common Stock held in or
hereafter acquired for the treasury of the Company. If an Option terminates or
expires without having been fully exercised for any reason, the Shares for which
the Option was not exercised may again be the subject of one or more Options
granted pursuant to the Plan.
<PAGE>
7. Term of the Plan. The Plan is effective as of August 2, 1995, the date
on which it was adopted by the Board of Directors, subject to the approval of
the Plan on or before December 31, 1995 by a majority of the votes cast at a
duly called meeting of the stockholders at which a quorum representing a
majority of all outstanding voting stock of the Company is, either in person or
by proxy, present and voting. If the Plan is not so approved on or before
December 31, 1995, all Options granted under the Plan shall be null and void. No
Option may be granted under the Plan after December 31, 2005.
8. Option Documents and Terms. Each Option granted under the Plan shall be
a Non-qualified Stock Option. Options granted pursuant to the Plan shall be
evidenced by the Option Documents in such form as the Committee shall from time
to time approve, which Option Documents shall comply with and be subject to the
following terms and conditions and such other terms and conditions as the
Committee shall from time to time require which are not inconsistent with the
terms of the Plan.
(a) Number of Option Shares. Each Option Document shall state the number of
Shares to which it pertains. An Optionee may receive more than one Option on the
terms and subject to the conditions and restrictions of the Plan.
(b) Timing of Grants; Number of Shares Subject of Options. Each Outside
Director shall be granted, on the earlier of (i) August 1, 1995 or (ii) his or
her becoming an Outside Director, an Option to purchase twenty five thousand
(25,000) Shares. Thereafter, each Outside Director shall be granted annually,
commencing on the first day of August, 1996 and on the first day of each August
thereafter, an Option to purchase ten thousand (10,000) Shares; provided that if
at the time of any grant of Options the number of Shares reserved for issuance
under this Plan is less than the number of Shares underlying the Options to be
granted pursuant to the terms hereof, then the number of Options granted to each
director shall be reduced proportionately.
(c) Option Price. Each Option Document shall state the Option Price, which
shall be equal to the Fair Market Value of the Shares on the date the Option is
granted. If the Common Stock is traded in a public market, then the Fair Market
Value per share shall be, if the Common Stock is listed on a national securities
exchange or included in the NASDAQ National Market System, the average of the
last reported sale prices thereof on the five (5) trading days preceding the
date of grant, or if the Common Stock is not so listed or included, the average
of the mean between the last reported "bid" and "asked" prices thereof on the
five (5) trading days preceding the date of grant, as reported on NASDAQ, or, if
not so reported, as reported by the National Daily Quotation Bureau, Inc. or as
reported in a customary financial reporting service, as applicable and as the
Committee determines. If the Common Stock is not traded in a public market, then
the Fair Market Value thereof shall be determined by the Board of Directors or
the Committee.
(d) Exercise. Each Option shall be exercisable on the date of grant to the
extent of not more than thirty-three and one-third percent (33-1/3%) of the
Shares granted. After the expiration of one (1) year from the date of grant, the
Option may be exercised to the extent of not more than sixty-six and two-thirds
percent (66-2/3%) of the Shares granted, and after the expiration of two (2)
years from the date of grant, the Option may be exercised to the extent of not
more than one hundred percent (100%) of the shares granted. No Option shall be
deemed to have been exercised prior to the receipt by the Company of written
notice of such exercise and payment in full of the Option Price for the shares
to be purchased. Each such notice shall specify the number of Shares to be
purchased and shall (unless the Shares are covered by a then current
registration statement or a Notification under Regulation A under the Securities
Act of 1933, as amended (the "Act")), contain the Optionee's acknowledgment in
form and substance satisfactory to the Company that (a) such Shares are being
purchased for investment and not for distribution or resale (other than a
distribution or resale which, in the opinion of counsel satisfactory to the
Company, may be made without violating the registration provisions of the Act),
(b) the Optionee has been advised and understands that (i) the Shares have not
been registered under the Act and are "restricted securities" within the meaning
of Rule 144 under the Act and are subject to restrictions on transfer and (ii)
the Company is under no obligation to register the Shares under the Act or to
take any action which would make available to the Optionee any exemption from
such registration, (c) such Shares may not be transferred without compliance
<PAGE>
with all applicable federal and state securities laws, and (d) an appropriate
legend referring to the foregoing restrictions on transfer and any other
restrictions imposed under the Option Documents may be endorsed on the
certificates. Notwithstanding the foregoing, if the Company determines that
issuance of Shares should be delayed pending (A) registration under federal or
state securities laws, (B) the receipt of an opinion of counsel acceptable to
the Company that an appropriate exemption from such registration is available,
(C) the listing or inclusion of the Shares on any securities exchange or an
automated quotation system or (D) the consent or approval of any governmental
regulatory body whose consent or approval is necessary in connection with the
issuance of such Shares, the Company may defer exercise of any Option granted
hereunder until any of the events described in this Subsection 8(d) has
occurred.
(e) Medium of Payment. An Optionee shall pay for Shares (i) in cash, (ii)
by certified or cashier's check payable to the order of the Company, or (iii) by
such other mode of payment as the Committee may approve, including payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board. Without limiting the foregoing, the Committee may provide
an Option Document that payment may be made in whole or in part in shares of the
Company's Common Stock. If payment is made in whole or in part in shares of the
Company's Common Stock, then the Optionee shall deliver to the Company
certificates registered in the name of such Optionee representing the shares
owned by such Optionee, free of all liens, claims and encumbrances of every kind
and having an aggregate Fair Market Value on the date of delivery that is at
least as great as the Option Price of the Shares (or relevant portion thereof)
with respect to which such Option is to be exercised by the payment in shares of
Common Stock, accompanied by stock powers duly endorsed in blank by the
Optionee. In the event that certificates for shares of the Company's Common
Stock delivered to the Company represent a number of shares in excess of the
number of shares required to make payment for the Option Price of the Shares (or
relevant portion thereof) with respect to which such Option is to be exercised
by payment in shares of Common Stock, the stock certificate issued to the
Optionee shall represent (i) the Shares in respect of which payment is made, and
(ii) such excess number of shares. Notwithstanding the foregoing, the Committee
may impose from time to time such limitations and prohibitions on the use of
shares of the Common Stock to exercise an Option as it deems appropriate.
(f) Termination of Options.
All Options granted pursuant to this Plan shall be exercisable until the
first to occur of the following:
(i) Expiration of ten (10) years from the date of grant;
(ii) Expiration of three (3) months from the date the
Optionee's service as an Outside Director
terminates for any reason other than Disability
or death; or
(iii)Expiration of one year from the date the
Optionee's service with Company as an Outside
Director terminates due to the Optionee's
Disability or death.
(g) Transfers. No option granted under the Plan may be transferred, except
by will or by the laws of descent and distribution. During the lifetime of the
person to whom an Option is granted, such Option may be exercised only by such
person. Notwithstanding the foregoing, a Non-qualified Stock Option may be
transferred pursuant to the terms of a "qualified domestic relations order,"
within the meaning of Sections 401(a)(13) and 414(p) of the Code or within the
meaning of Title I of the Employee Retirement Income Security Act of 1974, as
amended.
(h) Other Provisions. Subject to the provisions of the Plan, the Option
Documents shall contain such other provisions including, without limitation,
additional restrictions upon the exercise of the Option or additional
limitations upon the term of the Option, as the Committee shall deem advisable.
<PAGE>
(i) Amendment. Subject to the provisions of the Plan, the Committee shall
have the right to amend Option Documents issued to an Optionee, subject to the
Optionee's consent if such amendment is not favorable to the Optionee, except
that the consent of the Optionee shall not be required for any amendment made
under Section 9 of the Plan, as applicable.
9. Change in Control. In the event of a Change in Control, the Committee
may take whatever action it deems necessary or desirable with respect to the
Options outstanding, including, without limitation, accelerating the expiration
or termination date in the respective Option Documents to a date no earlier than
thirty (30) days after notice of such acceleration is given to the Optionees. In
addition to the foregoing, in the event of a Change in Control, Options granted
pursuant to the Plan shall become immediately exercisable in full.
A "Change in Control" shall be deemed to have occurred upon the earliest to
occur of the following events: (i) the date the stockholders of the Company (or
the Board of Directors, if stockholder action is not required) approve a plan or
other arrangement pursuant to which the Company will be dissolved or liquidated,
or (ii) the date the stockholders of the Company (or the Board of Directors, if
stockholder action is not required) and the stockholders of the other
constituent corporation (or its board of directors, if stockholder action is not
required) have approved a definitive agreement to merge or consolidate the
Company with or into such other corporation, other than, in either case, a
merger or consolidation of the Company in which holders of shares of the
Company's Common Stock immediately prior to the merger or consolidation will
hold at least a majority of the ownership of common stock of the surviving
corporation (and, if one class of common stock is not the only class of voting
securities entitled to vote on the election of directors of the surviving
corporation, a majority of the voting power of the surviving corporation's
voting securities) immediately after the merger or consolidation, which common
stock (and if applicable voting securities) is to be held in the same proportion
as such holders' ownership of Common Stock of the Company immediately before the
merger or consolidation, or (iv) the date any entity, person or group (within
the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange
Act of 1934, as amended) other than (A) the Company or any of its subsidiaries
or any employee benefit plan (or related trust) sponsored or maintained by the
Company or any of its subsidiaries, or (B) any person who, on the date the Plan
is effective, shall have been the beneficial owner of or have voting control
over shares of Common Stock of the Company, possessing more than ten percent
(10%) of the aggregate voting power of the Company's Common Stock shall have
become the beneficial owner of, or shall have obtained voting control over, more
than ten percent (10%) of the outstanding shares of the Company's Common Stock,
or (v) the first day after the date this Plan is effective when directors are
elected such that a majority of the Board of Directors shall have been members
of the Board of Directors for less than two (2) years, unless the nomination for
election of each new director who was not a director at the beginning of such
two (2) year period was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning of such
period.
10. Adjustments on Changes in Capitalization. The aggregate number of
Shares and class of Shares as to which Options may be granted hereunder, the
number and class or classes of Shares covered by each outstanding Option and the
Option Price thereof shall be appropriately adjusted in the event of a stock
dividend, stock split, recapitalization or other change in the number or class
of issued and outstanding equity securities of the Company resulting from a
subdivision or consolidation of the Common Stock and/or, if appropriate, other
outstanding equity securities or a recapitalization or other capital adjustment
(not including the issuance of Common Stock on the conversion of other
securities of the Company which are convertible into Common Stock) affecting the
Common Stock which is effected without receipt of consideration by the Company.
The Committee shall have authority to determine the adjustments to be made under
this Section, and any such determination by the Committee shall be final,
binding and conclusive.
<PAGE>
11. Amendment of the Plan. The Board of Directors of the Company may amend
the Plan from time to time in such manner as it may deem advisable. The
provisions of the Plan relating to (i) which directors shall be granted Options
pursuant to Section 8; (ii) the amount of Shares subject to Options granted
pursuant to Section 8; (iii) the price at which Shares subject to Options
granted pursuant to Section 8 may be purchased; and (iv) the timing of grants of
Options pursuant to Section 8, shall not be amended more than once every six (6)
months, other than to comport with changes in the Code or the Employee
Retirement Income Security Act of 1974, as amended. No amendment to the Plan
shall adversely affect any outstanding Option, however, without the consent of
the Optionee that holds such Option.
12. No Commitment to Retain. The grant of an Option pursuant to the Plan
shall not be construed to imply or to constitute evidence of any agreement,
express or implied, on the part of the Company or any Affiliate to retain the
Optionee as a member of the Company's Board of Directors or in any other
capacity.
13. Withholding of Taxes. Whenever the Company proposes or is required to
deliver or transfer Shares in connection with the exercise of an Option, the
Company shall have the right to (a) require the recipient to remit or otherwise
make available to the Company an amount sufficient to satisfy any federal, state
and/or local withholding tax requirements prior to the delivery or transfer of
any certificate or certificates for such Shares or (b) take whatever other
action it deems necessary to protect its interests with respect to tax
liabilities. The Company's obligation to make any delivery or transfer of Shares
shall be conditioned on the Optionee's compliance, to the Company's
satisfaction, with any withholding requirement.
14. Interpretation. The Plan is intended to enable transactions under the
Plan with respect to directors and officers (within the meaning of Section 16(a)
under the Securities Exchange Act of 1934, as amended) to satisfy the conditions
of Rule 16b-3; to the extent that any provision of the Plan, or any provisions
of any Option granted pursuant to the Plan, would cause a conflict with such
conditions or would cause the administration of the Plan as provided in Section
3 to fail to satisfy the conditions of Rule 16b-3, such provision shall be
deemed null and void to the extent permitted by applicable law.
September 26, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Allegro New Media, Inc.
Registration Statement on Form S-8
Gentlemen:
Reference is made to the filing by Allegro New Media, Inc. (the
"Corporation") of a Registration Statement on Form S-8 with the Securities and
Exchange Commission pursuant to the provisions of the Securities Act of 1933, as
amended, covering the registration of 500,000 shares of the Corporation's Common
Stock, $.001 par value per share, in connection with the Corporation's Outside
Director and Advisor Stock Option Plan (the "Plan").
As counsel for the Corporation, we have examined its corporate records,
including its Certificate of Incorporation, as amended, By-Laws, its corporate
minutes, the form of its Common Stock certificate, the Plan, related documents
under the Plan and such other documents as we have deemed necessary or relevant
under the circumstances.
Based upon our examination, we are of the opinion that:
1. The Corporation is duly organized and validly existing under the laws of
the State of Delaware.
2. There have been reserved for issuance by the Board of Directors of the
Corporation 500,000 shares of its Common Stock, $.001 par value per share. The
shares of the Corporation's Common Stock, when issued pursuant to the Plan, will
be validly authorized, legally issued, fully paid and non-assessable.
<PAGE>
Securities and Exchange Commission
September 26, 1996
Page Two
We hereby consent to be named in the Registration Statement and in the
Prospectus which constitutes a part thereof as counsel of the Corporation, and
we hereby consent to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
/s/ Blau, Kramer, Wactlar & Lieberman, P.C.
BLAU, KRAMER, WACTLAR &
LIEBERMAN, P.C.
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Allegro New Media, Inc. Outside Director and
Advisor Stock Option Plan of our report dated March 29, 1996, with respect to
the financial statements of Allegro New Media, Inc. included in its Annual
Report (Form 10-K) for the year ended December 31, 1995, filed with the
Securities and Exchange Commission.
/s/Ernst & Young LLP
Ernst & Young LLP
Hackensack, New Jersey
September 24, 1996
