AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 16, 1997
REGISTRATION NO. 333-_______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EQUITY CORPORATION INTERNATIONAL
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 75-2521142
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
415 SOUTH FIRST STREET
SUITE 210
LUFKIN, TEXAS 75901
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
1997 EQUITY CORPORATION INTERNATIONAL
EMPLOYEE STOCK PURCHASE PLAN
(FULL TITLE OF THE PLAN)
W. CARDON GERNER
SENIOR VICE PRESIDENT
AND CHIEF FINANCIAL OFFICER
415 SOUTH FIRST STREET
SUITE 210
LUFKIN, TEXAS 75901
(NAME AND ADDRESS OF AGENT FOR SERVICE)
(409) 631-8700
(TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
============================================= ============================================================= =================
PROPOSED MAXIMUM PROPOSED MAXIMUM
AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE REGISTERED BE REGISTERED PER SHARE(1) OFFERING PRICE(1) REGISTRATION FEE
- --------------------------------------------- ------------------------------------------------------------- -----------------
<S> <C> <C> <C> <C>
Common Stock, par value $0.01 per share(2) 500,000 Shares $21.00 $10,500,000 $3,182
============================================= ============================================================= =================
</TABLE>
(1) Estimated pursuant to Rule 457(c) solely for the purpose of calculating
the registration fee, based upon the average of the high and low sales
prices per share of the Company's Common Stock on the Nasdaq National
Market on April 14, 1997, as reported in theWALL STREET JOURNAL on
April 15, 1997.
(2) Includes preferred share purchase rights associated with the Common
Stock. No separate fee is payable in respect of the registration of
such preferred share purchase rights.
================================================================================
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Equity Corporation International (the "Company") incorporates herein by
reference the following documents as of their respective dates as filed with the
Securities and Exchange Commission (the "Commission"):
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1996; and
(b) The description of the Company's common stock, par value $0.01 per
share (the "Common Stock"), and preferred share purchase rights contained in the
Company's Registration Statement on Form 8-A (File No. 0-24728) filed with the
Commission on August 23, 1994 pursuant to Section 12 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), as amended by Amendment No. 1 on
Form 8-A/A filed with the Commission on October 6, 1994 and Amendment No. 2 on
Form 8-A/A filed with the Commission on September 11, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act after the date of this Registration Statement
and prior to the filing of a post-effective amendment which indicates that all
securities offered hereby 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
such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
The information required by Item 4 is not applicable to this
Registration Statement since the class of securities to be offered is registered
under Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The information required by Item 5 is not applicable to this
Registration Statement.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law, INTER ALIA,
empowers a Delaware corporation to indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding (other than an action by or in the right of the corporation)
by reason of the fact that such person is or was a director, officer, employee
or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding 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. Similar indemnity is
authorized for such persons against expenses (including attorneys' fees)
actually and reasonably incurred in connection with the defense or settlement of
any such threatened, pending or completed action or suit if such person 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 provided further that (unless a court of
competent jurisdiction otherwise provides) such person shall not have been
adjudged liable to the corporation. Any such indemnification may be made only as
authorized in each specific case upon a determination by the stockholders or
disinterested directors or by independent legal counsel in a written opinion
that indemnification is proper because the indemnitee has met the applicable
standard of conduct.
Section 145 further authorizes a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
II-1
<PAGE>
as a director, officer, employee or agent of another corporation or enterprise,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the corporation
would otherwise have the power to indemnify him under Section 145. The Company
maintains policies insuring its officers and directors against certain
liabilities for actions taken in their capacities as officers and directors,
including liabilities under the Securities Act of 1933.
The Company's Certificate of Incorporation and Bylaws permit the
directors and officers of the Company to be indemnified and permit the
advancement to them of expenses in connection with actual or threatened
proceedings and claims arising out of their status as such, to the fullest
extent permitted by the Delaware General Corporation Law. The Company has
entered into indemnification agreements with each of its directors and executive
officers that provide for indemnification and expense advancement to the fullest
extent permitted under the Delaware General Corporation Law. Such
indemnification agreements include related provisions intended to facilitate the
indemnities' receipt of such benefits, including certain provisions applicable
to constituent corporations in the event of certain mergers or acquisitions.
The Company's Certificate of Incorporation limits under certain
circumstances the liability of the Company's directors to the Company or its
stockholders to the fullest extent permitted by Delaware law. Specifically,
directors of the Company will not be personally liable for monetary damages for
breach of a director's fiduciary duty as a director, except for liability (i)
for a breach of the director's duty of loyalty to the Company or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the Delaware General Corporation Law (relating to the declaration of dividends
and purchase or redemption of shares in violation of the Delaware General
Corporation Law) or (iv) for any transaction from which the director derived an
improper personal benefit.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The information required by Item 7 is not applicable to this
Registration Statement.
ITEM 8. EXHIBITS.
Exhibit
Number Description
- ------ -----------
4.1+ -- Amended and Restated Certificate of Incorporation (filed as
Exhibit 4.1 to the Company's Registration Statement on Form S-8
(Reg. No. 33-98052))
4.2+ -- Amended and Restated Bylaws (filed as Exhibit 4.3 to the
Company's Registration Statement on Form S-8 (Reg. No.
33-98052))
4.3+ -- Form of Certificate representing shares of Common Stock (filed
as Exhibit 4.1 to the Company's Registration Statement on Form
S-1 (Reg. No. 33-82546))
4.4+ -- Stockholder Rights Agreement, dated October 13, 1994, between
the Company and American Stock Transfer & Trust Company, as
Rights Agent (filed as Exhibit 4.2 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1994)
4.5+ -- Certificate of Designation of the Series One Junior
Participating Preferred Stock (filed as Exhibit 4.2 to the
Company's Registration Statement on Form S-8 (Reg. No.
33-98052))
4.6+ -- First Amendment to Stockholders Rights Agreement, dated
September 10, 1996, between the Company and American Stock
Transfer & Trust Company as Rights Agent (filed as Exhibit 6 to
the Company's Registration Statement on Form 8-A/A (Amendment
No. 2)).
II-2
<PAGE>
4.7 -- Equity Corporation International 1997 Employee Stock Purchase
Plan
5.1 -- Opinion of Andrews & Kurth L.L.P., as to the legality of the
securities being registered
23.1 -- Consent of Andrews & Kurth L.L.P. (included in the opinion
filed as Exhibit 5.1 to this Registration Statement)
23.2 -- Consent of Coopers & Lybrand L.L.P.
24.1 -- Power of Attorney (set forth on the signature page contained in
Part II of this Registration Statement)
- ----------
+ Incorporated herein by reference.
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 this Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in this
Registration Statement;
(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 this Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by
reference in this 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 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
II-3
<PAGE>
(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 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
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 Lufkin, State of Texas, on the 16th day of April,
1997.
EQUITY CORPORATION INTERNATIONAL
By: /S/ JAMES P. HUNTER, III
James P. Hunter, III
Chairman of the Board,
President and Chief Executive Officer
POWER OF ATTORNEY
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.
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned officers
and directors of Equity Corporation International hereby constitutes and
appoints James P. Hunter, III and W. Cardon Gerner, and each of them (with full
power to each of them to act alone), his true and lawful attorney-in-fact and
agent, with full power of substitution, for him and on his behalf and in his
name, place and stead, in any and all capacities, to sign, execute and file this
Registration Statement under the Securities Act of 1933, and any or all
amendments (including, without limitation, post-effective amendments), with all
exhibits and any and all documents required to be filed with respect thereto,
with the Securities and Exchange Commission or any regulatory authority,
granting unto such 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 order to effectuate the same, as fully to all intents
and purposes as he himself might or could do if personally present, hereby
ratifying and confirming all that such attorneys-in-fact and agents, or any of
them, or their substitute or substitutes, may lawfully do or cause to be done.
Signature Title Date
--------- ----- ----
/S/ JAMES P. HUNTER, III Chairman of the Board, April 16, 1997
James P. Hunter, III President and Chief
Executive Officer
(Principal Executive Officer)
/S/ W. CARDON GERNER Senior Vice President and April 16, 1997
W. Cardon Gerner Chief Financial Officer
(Principal Financial and
Accounting Officer)
/S/ J. PATRICK DOHERTY Director April 16, 1997
J. Patrick Doherty
II-5
<PAGE>
/S/ JACK T. HAMMER Director April 16, 1997
Jack T. Hammer
/S/ THOMAS R. MCDADE Director April 16, 1997
Thomas R. McDade
/S/ KENNETH W. SMITH
Kenneth W. Smith Director April 16, 1997
II-6
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
4.1+ -- Amended and Restated Certificate of Incorporation (filed as
Exhibit 4.1 to the Company's Registration Statement on Form S-8
(Reg. No. 33-98052))
4.2+ -- Amended and Restated Bylaws (filed as Exhibit 4.3 to the
Company's Registration Statement on Form S-8 (Reg. No.
33-98052))
4.3+ -- Form of Certificate representing shares of Common Stock (filed
as Exhibit 4.1 to the Company's Registration Statement on Form
S-1 (Reg. No. 33-82546))
4.4+ -- Stockholder Rights Agreement, dated October 13, 1994, between
the Company and American Stock Transfer & Trust Company, as
Rights Agent (filed as Exhibit 4.2 to the Company's Annual
Report on Form 10-K for the year ended December 31, 1994)
4.5+ -- Certificate of Designation of the Series One Junior
Participating Preferred Stock (filed as Exhibit 4.2 to the
Company's Registration Statement on Form S-8 (Reg. No.
33-98052))
4.6+ -- First Amendment to Stockholders Rights Agreement, dated
September 10, 1996, between the Company and American Stock
Transfer & Trust Company as Rights Agent (filed as Exhibit 6 to
the Company's Registration Statement on Form 8-A/A (Amendment
No. 2)).
4.7 -- Equity Corporation International 1997 Employee Stock Purchase
Plan
5.1 -- Opinion of Andrews & Kurth L.L.P., as to the legality of the
securities being registered
23.1 -- Consent of Andrews & Kurth L.L.P. (included in the opinion
filed as Exhibit 5.1 to this Registration Statement)
23.2 -- Consent of Coopers & Lybrand L.L.P.
24.1 -- Power of Attorney (set forth on the signature page contained in
Part II of this Registration Statement)
- ----------
+ Incorporated herein by reference.
EXHIBIT 4.7
1997 EQUITY CORPORATION INTERNATIONAL
EMPLOYEE STOCK PURCHASE PLAN
Equity Corporation International hereby establishes the 1997 Equity
Corporation International Employee Stock Purchase Plan (the "Plan"), the terms
of which are as set forth below.
1. DEFINITIONS.
As used in the Plan the following terms shall have the meanings set
forth below:
(a) "Account" means a ledger account established by the Company for a
Participant.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Committee" means the Compensation Committee of the Board.
(e) "Common Stock" means the common stock, $0.01 par value, of Equity
Corporation International.
(f) "Company" means Equity Corporation International, a Delaware
corporation, or any successor.
(g) "Continuous Employment" means the absence of any interruption or
termination of service as an Eligible Employee with the Participating Companies.
Continuous Employment shall not be considered interrupted in the case of an
authorized leave of absence, provided that such leave is for a period of not
more than 90 days or reemployment upon the expiration of such leave is
guaranteed by contract or statute.
(h) "Eligible Compensation" means, with respect to each Participant,
the regular cash base compensation (wages, salary or commissions) paid to the
Participant by the Participating Companies each pay period during the Option
Period, including any elective salary deferral contributions made therefrom
pursuant to Code Sections 125, 129 or 401(k), but excluding bonuses and all
other items of compensation.
(i) "Eligible Employee" means an employee of the Participating
Companies who is customarily employed for at least 20 hours per week and more
than five months in a calendar year.
-1-
<PAGE>
(j) "Enrollment Date" means the first day of each Option Period.
(k) "Exercise Date" means the last day of each Option Period.
(l) "Exercise Price" means the price per share of the shares of Common
Stock offered in a given Option Period determined as provided in Section 10
below.
(m) "Fair Market Value" means, with respect to a share of Common Stock
as of any Enrollment Date or Exercise Date, closing sales price per share of the
Common Stock for such date (or, in the event that the Common Stock is not traded
on such date, on the immediately preceding trading date), as reported in THE
WALL STREET JOURNAL for the Nasdaq National Market or, in the event the Common
Stock is listed on a stock exchange, the fair market value per share shall be
the closing sales price on such exchange on such date (or, in the event that the
Common Stock is not traded on such date, on the immediately preceding trading
date), as reported in THE WALL STREET JOURNAL.
(n) "Option Period" means each six-month period commencing on January 1
and terminating on the following June 30 or commencing on July 1 and terminating
on the following December 31; provided, however, notwithstanding the foregoing
the initial Option Period shall commence on the later of (i) May 1, 1997 or (ii)
the effective date of the S-8 Registration Statement covering the shares of
Common Stock issuable under the Plan and shall end on June 30, 1997.
(o) "Participant" means an Eligible Employee who has elected to
participate in the Plan by filing an enrollment agreement with the Company as
provided in Section 7 below.
(p) "Participating Companies" means the Company and each present and
future Subsidiary that the Committee, in its sole discretion, from time to time
designates to be a Participating Company.
(q) "Subsidiary" means any corporation, domestic or foreign, of which
the Company owns, directly or indirectly, not less than 50% of the total
combined voting power of all classes of stock or other equity interests and that
otherwise qualifies as a "subsidiary corporation" within the meaning of Section
424(f) of the Code or any successor thereto.
-2-
<PAGE>
2. PURPOSE OF THE PLAN.
The purpose of the Plan is to provide an incentive for present and
future employees of the Participating Companies to acquire a proprietary
interest (or increase an existing proprietary interest) in the Company through
the purchase of Common Stock. It is the intention of the Company that the Plan
qualify as an "employee stock purchase plan" under Section 423 of the Code.
Accordingly, the provisions of the Plan shall be administered, interpreted and
construed in a manner consistent with the requirements of that section of the
Code.
3. SHARES RESERVED FOR THE PLAN.
There shall be reserved for issuance and purchase by Participants under
the Plan an aggregate of 500,000 shares of Common Stock, subject to adjustment
as provided in Section 15 below. Shares of Common Stock subject to the Plan may
be newly issued shares or treasury shares. If and to the extent that any option
to purchase shares of Common Stock shall not be exercised for any reason or if
such right to purchase shares shall terminate as provided herein, the shares
that have not been so purchased hereunder shall again become available for the
purposes of the Plan unless the Plan shall have been terminated.
4. ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by a Committee appointed by, and
which shall serve at the pleasure of, the Board. The Committee shall have
authority to interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to the Plan, to correct any defect or rectify any omission
in this Plan or to reconcile any inconsistency in this Plan or any option, and
to make all other determinations necessary or advisable for the administration
of the Plan, all of which actions and determinations shall be final, conclusive
and binding on all persons. The act or determination of a majority of the
members of the Committee shall be deemed to be the act or determination of the
Committee.
(b) The Committee may request advice or assistance or employ such other
persons as it in its discretion deems necessary or appropriate for the proper
administration of the Plan, including, but not limited to employing a brokerage
firm, bank or other financial institution to assist in the purchase of shares,
delivery of reports or other administrative aspects of the Plan.
(c) All Eligible Employees granted options under the Plan shall have
the same rights and privileges; however, the Plan will not fail to satisfy this
requirement merely because the amount of Common Stock which may be purchased by
any Eligible Employee is determined on the basis of a uniform relationship to
the Eligible Compensation of Eligible Employees, or because the Plan provides
that no Eligible Employee may purchase more than a maximum amount of Common
Stock as set forth under the Plan.
-3-
<PAGE>
5. ELIGIBILITY TO PARTICIPATE IN THE PLAN.
Subject to the further provisions of the Plan, each Eligible Employee
who is employed by a Participating Company on an Enrollment Date shall be
eligible to participate in the Plan for the Option Period beginning on that
Enrollment Date.
6. OPTION PERIODS.
The Plan shall consist of consecutive Option Periods until the Plan is
terminated.
7. ELECTION TO PARTICIPATE IN THE PLAN.
(a) Each Eligible Employee may elect to participate in the Plan by
completing an enrollment agreement in the form provided by the Company and
filing such enrollment agreement with the Company prior to the applicable
Enrollment Date, unless another time for filing the enrollment form is set by
the Committee for all Eligible Employees with respect to a given Option Period.
(b) Payroll deductions for a Participant shall commence on the first
payroll date following the Enrollment Date and shall end on the last payroll
date in the Option Period to which such authorization is applicable, unless
sooner terminated by the Participant as provided in Section 12.
(c) Unless a Participant elects otherwise prior to the Enrollment Date
of the immediately succeeding Option Period, an Eligible Employee who is
participating in an Option Period as of the Exercise Date of such Option Period
shall be deemed (i) to have elected to participate in the immediately succeeding
Option Period and (ii) to have authorized the same payroll deduction for such
immediately succeeding Option Period as was in effect for such Participant
immediately prior to the succeeding Option Period.
8. PAYROLL DEDUCTIONS.
(a) All Participant contributions to the Plan shall be made only by
payroll deductions. At the time a Participant files the enrollment agreement
with respect to an Option Period, the Participant shall authorize payroll
deductions to be made on each payroll date during the Option Period in an amount
of from 1% to 10% of the Eligible Compensation which the Participant receives on
each payroll date during such Option Period. The amount of such payroll
deductions shall be a whole percentage (i.e., 1%, 2%, 3%, etc.) of the
Participant's Eligible Compensation.
(b) All payroll deductions made for a Participant may be deposited in
the Company's general corporate account and shall be credited to the
Participant's Account under the Plan. No interest shall accrue or be credited
with respect to the payroll deductions of a Participant under the Plan. A
Participant may not make any additional payments into such Account. All payroll
-4-
<PAGE>
deductions received or held by the Company under the Plan may be used by the
Company for any corporate purpose, and the Company shall not be obligated to
segregate such payroll deductions.
(c) Except as provided in Section 12, a Participant may not change his
contribution election during an Option Period.
(d) Notwithstanding the foregoing, no Participant may make payroll
deductions during any year in excess of $21,250.
9. GRANT OF OPTIONS.
(a) On the Enrollment Date of each Option Period, subject to the
limitations set forth in Sections 3 and 9(b) hereof, each Eligible Employee
shall be granted an option to purchase on the Exercise Date for such Option
Period (at the Exercise Price determined as provided in Section 10 below) up to
a number of shares of the Company's Common Stock determined by dividing such
Eligible Employee's payroll deductions accumulated during the Option Period
ending on such Exercise Date by 85% of the fair market value of a share of the
Common Stock on the Enrollment Date or on the Exercise Date, whichever is lower.
(b) Notwithstanding any provision of the Plan to the contrary, no
Eligible Employee shall be granted an option under the Plan (i) if, immediately
after the grant, such Eligible Employee (or any other person whose stock would
be attributed to such Employee pursuant to Section 424(d) of the Code) would own
stock and/or hold outstanding options to purchase stock possessing 5% or more of
the total combined voting power or value of all classes of stock of the Company
or of any Subsidiary of the Company, or (ii) which permits such Eligible
Employee's rights to purchase stock under all employee stock purchase plans of
the Company and its Subsidiaries to accrue at a rate which exceeds $25,000 of
fair market value of such stock (determined at the time such option is granted)
for each calendar year in which such option is outstanding at any time.
10. EXERCISE PRICE.
The Exercise Price of each of the shares offered in a given Option
Period shall be the lower of: (i) 85% of the Fair Market Value of a share of the
Common Stock on the applicable Enrollment Date, or (ii) 85% of the Fair Market
Value of a share of the Common Stock on the applicable Exercise Date.
11. EXERCISE OF OPTIONS.
Unless a Participant withdraws from the Plan as provided in Section 12,
the Participant's option for the purchase of shares will be exercised
automatically on each Exercise Date, and the maximum number of shares subject to
the option will be purchased for the Participant at the applicable Exercise
Price with the accumulated payroll deductions in the Participant's Account.
-5-
<PAGE>
12. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A Participant may withdraw all but not less than all of the payroll
deductions credited to the Participant's Account under the Plan at any time by
giving written notice to the Company. All of the Participant's payroll
deductions credited to the Participant's Account will be paid to him promptly
after receipt of the Participant's notice of withdrawal, the Participant's
participation in the Plan will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made. Payroll deductions
will not resume on behalf of a Participant who has withdrawn from the Plan
unless written notice is delivered to the Company within the enrollment period
preceding the commencement of a new Option Period directing the Company to
resume payroll deductions.
(b) Upon termination of the Participant's Continuous Employment prior
to the Exercise Date of the Option Period for any reason, including retirement
or death, the payroll deductions credited to the Participant's Account will be
returned to the Participant or, in the case of death, to the Participant's
estate, and the Participant's options to purchase shares under the Plan will be
automatically terminated.
(c) In the event a Participant ceases to be an Eligible Employee during
an Option Period, the Participant will be deemed to have elected to withdraw
from the Plan, the payroll deductions credited to the Participant's Account will
be returned to the Participant, and the Participant's options to purchase shares
under the Plan will be terminated.
(d) A Participant's withdrawal from an Option Period will not affect
the Participant's eligibility to participate in a succeeding Option Period.
13. TRANSFERABILITY.
Options to purchase Common Stock granted under the Plan are not
transferable by a Participant and are exercisable only by the Participant.
14. REPORTS.
Individual Accounts will be maintained for each Participant in the
Plan. Statements of Accounts will be given to participating Employees
semi-annually promptly following each Exercise Date, which statements will set
forth the amounts of payroll deductions, the per share purchase price, the
number of shares purchased and the remaining cash balance, if any.
15. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
(a) If the outstanding shares of Common Stock are increased or
decreased, or are changed into or are exchanged for a different number or kind
of shares, as a result of one or more reorganizations, restructurings,
recapitalizations, reclassifications, stock splits, reverse stock splits,
-6-
<PAGE>
stock dividends or the like, upon authorization of the Committee, appropriate
adjustments may be made in the number and/or kind of shares, and the per share
option price thereof, which may be issued in the aggregate and to any
Participant upon exercise of options granted under the Plan.
(b) In the event of the proposed dissolution or liquidation of the
Company, each Option Period will terminate immediately prior to the consummation
of such proposed action, unless otherwise provided by the Committee. In the
event of a proposed sale of all or substantially all of the assets of the
Company, or the merger of the Company with or into another corporation, each
option under the Plan shall be assumed or an equivalent option shall be
substituted by such successor corporation or a parent or subsidiary of such
successor corporation, unless the Committee determines, in the exercise of its
sole discretion and in lieu of such assumption or substitution, that the
Participant shall have the right to exercise the option as to all of the
optioned stock, including shares as to which the option would not otherwise be
exercisable. If the Committee makes an option fully exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the
Committee shall notify the Participant that the option shall be fully
exercisable for a stated period, which shall not be less than 10 days from the
date of such notice, and the option will terminate upon the expiration of such
period.
(c) In all cases, the Committee shall have full discretion to exercise
any of the powers and authority provided under this Section 15, and the
Committee's actions hereunder shall be final and binding on all Participants. No
fractional shares of stock shall be issued under the Plan pursuant to any
adjustment authorized under the provisions of this Section 15.
16. AMENDMENT OF THE PLAN.
The Board may at any time, or from time to time, amend the Plan in any
respect; provided, however, that the Plan may not be amended in any way that
will cause rights issued under the Plan to fail to meet the requirements for
employee stock purchase plans as defined in Section 423 of the Code or any
successor thereto, including, without limitation, shareholder approval if
required.
17. TERMINATION OF THE PLAN.
The Plan and all rights of Eligible Employees hereunder shall
terminate:
(a) on the Exercise Date that Participants become entitled to purchase
a number of shares greater than the number of reserved shares remaining
available for purchase under the Plan; or
(b) at any time, at the discretion of the Board.
In the event that the Plan terminates under circumstances described in
Section 17(a) above, reserved shares remaining as of the termination date shall
be sold to Participants on a pro rata basis.
-7-
<PAGE>
18. NOTICES.
All notices or other communications by a Participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when received in the form specified by the Company at the location, or by the
person, designated by the Company for the receipt thereof.
19. SHAREHOLDER APPROVAL.
The Plan shall be subject to approval by the shareholders of the
Company within twelve months after the date the Plan is adopted by the Board of
Directors. If such shareholder approval is not obtained prior to the first
Exercise Date, the Plan shall be null and void and all Participants shall be
deemed to have withdrawn on such Exercise Date pursuant to Section 12.
20. CONDITIONS UPON ISSUANCE OF SHARES.
(a) The Plan, the grant and exercise of options to purchase shares of
Common Stock under the Plan, and the Company's obligation to sell and deliver
shares upon the exercise of options to purchase shares shall be subject to all
applicable federal, state and foreign laws, rules and regulations, and to such
approvals by any regulatory or governmental agency as may, in the opinion of
counsel for the Company, be required. In the event the Company is required to
obtain from any commission or agency authority to issue any stock certificate,
the inability of the Company to obtain from any such commission or agency
authority that counsel for the Company deems necessary for the lawful issuance
of any such certificate will relieve the Company from liability to any
Participant, except to return to him the amount of the balance in his account.
(b) The Company may make such provisions as it deems appropriate for
withholding of amounts that the Company determines it is required to withhold
pursuant to applicable tax laws in connection with the purchase or sale by a
Participant of any Common Stock acquired pursuant to the Plan. The Company may
require a Participant to satisfy any relevant tax requirements before
authorizing any issuance of Common Stock to such Participant.
-8-
EXHIBIT 5.1
Andrews & Kurth L.L.P.
[letterhead]
April 16, 1997
Board of Directors
Equity Corporation International
415 South First Street, Suite 210
Lufkin, Texas 75901
Gentlemen:
We have acted as counsel to Equity Corporation International, a
Delaware corporation (the "Company"), in connection with the Company's
Registration Statement on Form S-8 (the "Registration Statement"), relating to
the registration under the Securities Act of 1933, as amended, of the offering
and sale of up to 500,000 shares (the "Shares") of the Company's common stock,
par value $0.01 per share ("Common Stock") by the Company pursuant to its 1997
Employee Stock Purchase Plan (the "Plan").
In connection herewith, we have examined copies of such statutes,
regulations, corporate records and documents, certificates of public and
corporate officials and other agreements, contracts, documents and instruments
as we have deemed necessary as a basis for the opinion hereafter expressed. In
such examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity
with the original documents of all documents submitted to us as copies. We have
also relied, to the extent we deem such reliance proper, upon information
supplied by officers and employees of the Company with respect to various
factual matters material to our opinion.
Based upon the foregoing and having due regard for such legal
considerations as we deem relevant, we are of the opinion that the Shares, when
issued in accordance with the terms of the Plan, will be validly issued, fully
paid and nonassessable.
We hereby consent to the inclusion of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Andrews & Kurth L.L.P.
1208/1249/2606
EXHIBIT 23.2
CONSENT OF INDENPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Equity Corporation International on Form S-8 pertaining to 500,000 shares of
Equity Corporation International Common Stock, par value $.01 per share, to be
offered or sold pursuant to the Equity Corporation International 1997 Employee
Stock Purchase Plan of our report dated March 6, 1997, on our audits of the
consolidated financial statements and financial statement schedule of Equity
Corporation International as of December 31, 1996 and 1995, and for each of the
three years ended December 31, 1996, which report is included in the Annual
Report on Form 10-K.
COOPERS & LYBRAND L.L.P.
Houston, Texas
April 16, 1997
