As filed with the Securities and Exchange Commission on March 18, 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
450 FIFTH STREET, N.W.
WASHINGTON, D.C. 20549
----------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------
SPEIZMAN INDUSTRIES, INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 56-0901212
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
508 W. 5th Street
Charlotte, North Carolina 28231
(Address of Principal Executive Offices, including zip code)
SPEIZMAN INDUSTRIES, INC.
NONQUALIFIED STOCK OPTION PLAN
(Full Title of the Plan)
Josef Sklut Copy to:
Speizman Industries, Inc. Elizabeth G. Wren, Esq.
508 W. 5th Street Kilpatrick Stockton LLP
Charlotte, North Carolina 28231 3500 One First Union Center
(704) 372-3751 301 South College Street
(Name, Address, and Telephone Charlotte, NC 28202
Number of Agent for Service) (704) 338-5000
- ---------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
- ----------------------------------------------------------------------------
<TABLE>
<CAPTION>
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount To Be Offering Price Aggregate Offering Registration
To Be Registered Registered Per Share Price Fee
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$0.10 Par Value 145,000 (1) $6.00 (2) $870,000 (2) $263.64 (2)
- -------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) This Registration Statement also includes such indeterminate number of
additional shares of the Common Stock of the Registrant as may be
issuable as a result of stock splits, stock dividends or similar
transactions as described in the Nonqualified Stock Option Plan.
(2) Pursuant to Rule 457(h) under the Securities Act of 1933, as amended,
the aggregate offering price and the amount of the registration fee
are based upon the exercise price of options to purchase 145,000
shares of the Common Stock of the Registrant which have been granted
under the Registrant's Nonqualified Stock Option Plan.
<PAGE>
INCORPORATION OF PREVIOUS REGISTRATION STATEMENT
This Registration Statement is being filed to register an additional
145,000 shares of the Common Stock of the Registrant under the Speizman
Industries, Inc. Nonqualified Stock Option Plan. Pursuant to General Instruction
E of Form S-8, the contents of the Registrant's Registration Statement on Form
S-8, File No. 333-06287, are hereby incorporated in this Registration Statement
by reference.
The following Exhibits are being filed as part of this Registration
Statement:
Exhibit No. Description
5 Opinion of Kilpatrick Stockton LLP.
23.1 Consent of BDO Seidman, LLP.
23.2 Consent of Kilpatrick Stockton LLP (Contained in Exhibit 5).
24 Power of Attorney (Contained on signature page).
99.1 Speizman Industries, Inc. Nonqualified Stock Option Plan as
amended on October 4, 1996.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all 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 County of Mecklenburg, State of North Carolina, on this
14th day of March, 1997.
SPEIZMAN INDUSTRIES, INC.
By:/s/ Robert S. Speizman, President
Robert S. Speizman, President
KNOW ALL MEN BY THESE PRESENTS that each individual whose signature appears
below constitutes and appoints Robert S. Speizman and Josef Sklut, and each of
them, his true and lawful attorneys-in-fact and agents with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and all documents in connection therewith, with the Securities
and Exchange Commission, 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 and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agents, or their substitutes, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
NAME TITLE DATE
<S> <C> <C>
/s/ Robert S. Speizman President (Principal Executive Officer) March 14, 1997
- ----------------------------------------
ROBERT S. SPEIZMAN and Director
/s/ Josef Sklut Vice President-Finance, Secretary and March 14, 1997
- ----------------------------------------
JOSEF SKLUT Treasurer (Principal Financial Officer
and Principal Accounting Officer) and
Director
/s/ Steven P. Berkowitz Director March 11, 1997
- ----------------------------------------
STEVEN P. BERKOWITZ
/s/ William Gorelick Director March 11, 1997
- ----------------------------------------
WILLIAM GORELICK
/s/ Scott Lea Director March 14, 1997
- ----------------------------------------
SCOTT LEA
</TABLE>
3
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
5 Opinion of Kilpatrick Stockton LLP.
23.1 Consent of BDO Seidman, LLP.
23.2 Consent of Kilpatrick Stockton LLP (Contained in Exhibit 5).
24 Power of Attorney (Contained on signature page).
99.1 Speizman Industries, Inc. Nonqualified Stock Option Plan as
amended on October 4, 1996.
4
<PAGE>
EXHIBIT 5
[GRAPHIC OMITTED][GRAPHIC OMITTED]
ATTORNEYS AT LAW
3500 One First Union Center
301 South College Street
Charlotte, North Carolina 28202-6001
Telephone: 704.338.5000
Facsimile: 704.338.5125
March 14, 1997
Speizman Industries, Inc.
508 W. 5th Street
Charlotte, North Carolina 282312
Gentlemen:
We refer to the registration statement on Form S-8 (the "Registration
Statement"), to be filed by Speizman Industries, Inc. (the "Company") with the
Securities and Exchange Commission on or about March 18, 1997, under the
Securities Act of 1933, as amended, relating to the additional 145,000 shares of
the common stock of the Company, par value $0.10 per share (the "Shares"),
issuable by the Company pursuant to the Speizman Industries, Inc.
Nonqualified Stock Option Plan (the "Plan").
As counsel for the Company, we have examined such corporate records and other
documents and such matters of law as we have considered necessary or appropriate
for the purposes of this opinion. Upon the basis of that examination, we advise
you that, in our opinion, the Shares have been duly and validly authorized and,
upon issuance thereof by the Company and receipt of the consideration by the
Company, both in accordance with the terms of the Plan and any award agreement
thereunder, and the delivery of the certificates representing the Shares so
issued, will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Kilpatrick Stockton LLP
KILPATRICK STOCKTON LLP
Atlanta o Augusta o Brussels o Charlotte
o London o Raleigh o Washington o Winston-Salem
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement of our report dated September 10, 1996, relating to the consolidated
financial statements of SPEIZMAN INDUSTRIES, INC. AND SUBSIDIARIES appearing in
the Company's Annual Report on Form 10-K for the year ended June 29, 1996.
/s/ BDO Seidman, LLP
BDO SEIDMAN, LLP
Charlotte, North Carolina
March 14, 1997
<PAGE>
EXHIBIT 99.1
SPEIZMAN INDUSTRIES, INC.
NONQUALIFIED STOCK OPTION PLAN
EFFECTIVE AS OF SEPTEMBER 21, 1995
AS AMENDED ON OCTOBER 4, 1996
ARTICLE I - GENERAL PROVISIONS
1.1 The Plan is designed, for the benefit of the Company, to attract and
retain for the Company personnel of exceptional ability, to motivate
such personnel through added incentives to make a maximum contribution
to the Company, to develop and maintain a highly competent management
team and to be competitive with other companies with respect to
executive compensation.
1.2 Awards under the Plan may be made to Participants in the form of
nonqualified stock options.
1.3 The Plan shall be effective September 21, 1995 (the "Effective Date"),
subject to the approval of the stockholders of the Company. Options may
be granted prior to such approval, but such Options shall be contingent
upon such approval being obtained and, in addition to any other terms
thereof or restrictions thereon under the Plan or an Award Agreement,
may not be exercised or transferred prior to such approval.
ARTICLE II - DEFINITIONS
Except where the context otherwise indicates, the following definitions apply:
2.1 "Acceleration Event" means the occurrence of an event defined in
Article XIII of the Plan.
2.2 "Act" means the Securities Exchange Act of 1934, as now in effect or as
hereafter amended. All citations to sections of the Act or rules
thereunder are to such sections or rules as they may from time to time
be amended or renumbered.
2.3 "Award Agreement" means the written agreement evidencing an Option
granted to a Participant.
2.4 "Board" means the Board of Directors of Speizman Industries, Inc.
2.5 "Code" means the Internal Revenue Code of 1986, as now in effect or as
hereafter amended. All citations to sections of the Code are to such
sections as they may from time to time be amended or renumbered.
<PAGE>
2.6 "Committee" means the Stock Option Committee of the Board or such other
committee consisting of two or more members as may be appointed by the
Board to administer this Plan pursuant to Article III. To the extent
required by Rule 16b-3 under the Act, the Committee shall consist of
individuals who are members of the Board and Non-Employee Directors
(except as otherwise permitted under Rule 16b-3 under the Act).
Committee members may also be appointed for such limited purposes as
may be provided by the Board.
2.7 "Company" means Speizman Industries, Inc., a Delaware corporation, and
its successors and assigns. The term "Company" shall include any
corporation which is a member of a controlled group of corporations (as
defined in Section 414(b) of the Code, as modified by Section 415(h) of
the Code) which includes the Company; any trade or business (whether or
not incorporated) which is under common control (as defined in Section
414(c) of the Code, as modified by Section 415(h) of the Code) with the
Company; any organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in Section 414(m) of
the Code) which includes the Company; and any other entity required to
be aggregated with the Company pursuant to regulations under Section
414(o) of the Code. With respect to all purposes of the Plan,
including, but not limited to, the establishment, amendment,
termination, operation and administration of the Plan, Speizman
Industries, Inc. shall be authorized to act on behalf of all other
entities included within the definition of "Company."
2.8 "Disability" means a disability as determined under procedures
established by the Committee or in any Option.
2.9 "Non-Employee Director" shall have the meaning set forth in Rule 16b-3
under the Act.
2.10 "Eligible Participant" means any employee of the Company, as shall be
determined by the Committee, as well as any other person, including
directors, whose participation the Committee determines is in the best
interest of the Company, subject to limitations as may be provided by
the Code, the Act or the Committee.
2.11 "Fair Market Value" means, if the Stock is listed for trading on any
national securities exchange, the last sale price regular way of the
Stock on the date of reference, or, if no sale of the Stock takes place
on such date, the average of the closing high bid and low asked prices
regular way of the Stock on such date, in either case on such exchange.
If the Stock is not listed for trading on a national securities
exchange, but is listed on The Nasdaq Stock Market, then "fair market
value" means the last sale price of the Stock on the date of reference,
or, if no sale of the Stock takes place on such date, the average of
the closing high bid and low asked prices of the Stock on such date, in
either case as reported by The Nasdaq Stock Market. The Committee may
establish an alternative method of determining Fair Market Value.
2
<PAGE>
2.12 "Option" means a nonqualified stock option to purchase Stock granted
under Article IV of the Plan.
2.13 "Option Grant Date" means, as to any Option:
(a) the date on which the Committee grants the Option by entering into
an Award Agreement with the Participant;
(b) the date the Participant receiving the Option becomes an employee
of the Company, to the extent employment status is a condition of
the grant or a requirement of the Code or the Act; or
(c) such other date as the Committee may designate.
2.14 "Participant" means an Eligible Participant to whom an Option has been
granted and who has entered into an Award Agreement evidencing the
Option.
2.15 "Plan" means the Speizman Industries, Inc. Nonqualified Stock Option
Plan set forth herein, as amended from time to time.
2.16 "Stock" means shares of the common stock, par value $.10 per share, of
Speizman Industries, Inc., as may be adjusted pursuant to the
provisions of Section 3.14.
2.17 "Termination of Employment" means the discontinuance of employment of a
Participant with the Company for any reason. The determination of
whether a Participant has discontinued employment shall be made by the
Committee in its discretion. In determining whether a Termination of
Employment has occurred, the Committee may provide that service as a
consultant or service with a business enterprise in which the Company
has a significant ownership interest shall be treated as employment
with the Company. The Committee shall have the discretion, exercisable
either at the time an Option is granted or at the time the Participant
terminates employment, to establish as a provision applicable to the
exercise of one or more Options that during the limited period of
exercisability following Termination of Employment, the Option may be
exercised not only with respect to the number of shares of Stock for
which it is exercisable at the time of the Termination of Employment
but also with respect to one or more subsequent installments for which
the Option would have become exercisable had the Termination of
Employment not occurred.
3
<PAGE>
ARTICLE III - ADMINISTRATION
3.1 This Plan shall be administered by the Committee. A Committee member
who is not a Non-Employee Director, with respect to action to be taken
by the Committee, shall not be able to participate in the decision to
the extent prescribed by Rule 16b-3 under the Act. The Committee, in
its discretion, may delegate to one or more of its members such of its
powers as it deems appropriate. The Committee also may limit the power
of any member to the extent necessary to comply with Rule 16b-3 under
the Act or any other law. Members of the Committee shall be appointed
originally, and as vacancies occur, by the Board, to serve at the
pleasure of the Board. The Board may serve as the Committee, if by the
terms of the Plan all Board members are otherwise eligible to serve on
the Committee.
3.2 The Committee shall meet at such times and places as it determines. A
majority of its members shall constitute a quorum, and the decision of
a majority of those present at any meeting at which a quorum is present
shall constitute the decision of the Committee. A memorandum signed by
all of its members shall constitute the decision of the Committee
without necessity, in such event, for holding an actual meeting.
3.3 The Committee shall have the exclusive right to interpret, construe and
administer the Plan, to select the persons who are eligible to receive
an Option, and to act in all matters pertaining to the granting of an
Option and the contents of the Award Agreement evidencing the Option,
including without limitation the determination of the number of Options
and the form, terms, conditions and duration of each Option, and any
amendment thereof consistent with the Plan. All acts, determinations
and decisions of the Committee made or taken pursuant to grants of
authority under the Plan or with respect to any questions arising in
connection with the administration and interpretation of the Plan,
including the severability of any and all of the provisions hereof,
shall be conclusive, final and binding upon all Participants, Eligible
Participants and their beneficiaries.
3.4 The Committee may adopt such rules, regulations and procedures of
general application for the administration of this Plan, as the
Committee deems appropriate.
3.5 Without limiting the foregoing Sections 3.1, 3.2, 3.3 and 3.4, and
notwithstanding any other provisions of the Plan, the Committee is
authorized to take such action as it determines to be necessary or
advisable, and fair and equitable to Participants, with respect to an
Option in the event of an Acceleration Event as defined in Article V.
Such action may include, but shall not be limited to, establishing,
amending or waiving the forms, terms, conditions and duration of an
Option and the corresponding Award Agreement so as to provide for
earlier, later, extended or additional times for exercise or payments,
differing methods for calculating payments, alternate forms and amounts
of payment, an accelerated release of restrictions or other
modifications. The Committee may take such actions pursuant to this
Section 3.5 by adopting rules and regulations of
4
<PAGE>
general applicability to all Participants or to certain categories of
Participants, by including, amending or waiving terms and conditions in
an Option and the corresponding Award Agreement, or by taking action
with respect to individual Participants.
3.6 In addition to such other rights of indemnification as they may have as
directors or as members of the Committee, the members of the Committee
shall be indemnified by the Company against reasonable expenses,
including attorney's fees, actually and necessarily incurred in
connection with the defense of any action, suit or proceeding, or in
connection with any appeal therein, to which they or any of them may be
a party by reason of any action taken or failure to act under or in
connection with the Plan or any Option granted thereunder, and against
all amounts paid by them in settlement thereof, provided such
settlement is approved by independent legal counsel selected by the
Company, or paid by them in satisfaction of a judgment or settlement in
any such action, suit or proceeding, except as to matters as to which
the Committee member has been negligent or engaged in misconduct in the
performance of his duties; provided, that within 60 days after
institution of any such action, suit or proceeding, a Committee member
shall in writing offer the Company the opportunity, at its own expense,
to handle and defend the same.
3.7 The Committee may require each person purchasing shares of Stock
pursuant to an Option to represent to and agree with the Company in
writing that he is acquiring the shares of Stock without a view to
distribution thereof. The certificates for such shares of Stock may
include any legend which the Committee deems appropriate to reflect any
restrictions on transfer.
3.8 The Committee shall be authorized to make adjustments in performance
based criteria or in the terms and conditions of Options in recognition
of unusual or nonrecurring events affecting the Company or its
financial statements or changes in applicable laws, regulations or
accounting principles. The Committee may correct any defect, supply any
omission or reconcile any inconsistency in the Plan or any Award
Agreement in the manner and to the extent it shall deem desirable to
carry it into effect. In the event the Company shall assume outstanding
employee benefit awards or the right or obligation to make future such
awards in connection with the acquisition of another corporation or
business entity, the Committee may, in its discretion, make such
adjustments in the terms of Options under the Plan as it shall deem
appropriate.
3.9 The Committee shall have full power and authority to determine whether,
to what extent and under what circumstances, any Option shall be
canceled or suspended. In particular, but without limitation, all
outstanding Options to any Participant may be canceled if the
Participant (a) without the consent of the Committee, while employed by
the Company or after termination of such employment, becomes associated
with, employed by, renders services to, or owns any interest in, other
than any insubstantial interest, as determined by the Committee, any
business that is in competition with the Company or with any
5
<PAGE>
business in which the Company has a substantial interest as determined
by the Committee; or (b) is terminated for cause as determined by the
Committee.
3.10 The aggregate number of shares of Stock which are available for
issuance pursuant to Options granted under the Plan shall be 290,0001
or any larger number that, subsequent to the date this Plan is adopted,
may be authorized for issuance by the Company. Such shares of Stock
shall be made available from authorized and unissued shares. If, for
any reason, any shares of Stock awarded or subject to purchase under
the Plan are not delivered or purchased, or are reacquired by the
Company, for reasons including, but not limited to, expiration or
cancellation of an Option or any other termination of an Option without
payment being made in the form of Stock, such shares of Stock shall not
be charged against the aggregate number of shares of Stock available
for Options under the Plan, and may again be available for grants of
Options under the Plan.
3.11 The Company shall not be required to issue or deliver any certificates
for shares of Stock prior to:
(a) the listing of such shares on any stock exchange on which the
Stock may then be listed; and
(b) the completion of any registration or qualification of such
shares of Stock under any federal or state law, or any ruling
or regulation of any government body which the Company shall,
in its discretion, determine to be necessary or advisable.
3.12 All certificates for shares of Stock delivered under the Plan shall
also be subject to such stop-transfer orders and other restrictions as
the Committee may deem advisable under the rules, regulations, and
other requirements of the Securities and Exchange Commission, any stock
exchange upon which the Stock is then listed and any applicable federal
or state laws, and the Committee may cause a legend or legends to be
placed on any such certificates to make appropriate reference to such
restrictions. In making such determination, the Committee may rely upon
an opinion of counsel for the Company.
3.13 Except as provided otherwise in the Plan or in an Award Agreement, no
Participant awarded an Option shall have any right as a shareholder
with respect to any shares of Stock covered by such Option prior to the
date of issuance to him or her of a certificate or certificates for
such shares of Stock.
- --------
1 On October 4, 1996, the Board amended the Plan to increase the
aggregate number of shares of Stock available for issuance
pursuant to Options granted under the Plan to 290,000 from
145,000, subject to the approval of the Stockholders which was
obtained on November 19, 1996.
6
<PAGE>
3.14 If any reorganization, recapitalization, reclassification, stock
split-up, stock dividend, or consolidation of shares of Stock, merger
or consolidation of the Company or sale or other disposition by the
Company of all or a portion of its assets, any other change in the
Company's corporate structure, or any distribution to stockholders
other than a cash dividend results in the outstanding shares of Stock,
or any securities exchanged therefor or received in their place, being
exchanged for a different number or class of shares of Stock or other
securities of the Company, or for shares of Stock or other securities
of any other corporation, or new, different or additional shares or
other securities of the Company or of any other corporation being
received by the holders of outstanding shares of Stock, then equitable
adjustments shall be made by the Committee in:
(a) the limitation on the aggregate number of shares of Stock that may
be issued as set forth in Section 3.10 of the Plan;
(b) the number and class of Stock that may be subject to a grant of an
Option and which have not been issued or transferred under an
outstanding Option;
(c) the purchase price to be paid per share of Stock under outstanding
Options; and
(d) the terms, conditions or restrictions of any Option and Award
Agreement.
ARTICLE IV - OPTIONS
4.1 Options to purchase shares of Stock may be granted to Eligible
Participants at such time or times determined by the Committee,
following the Effective Date, subject to the terms and conditions set
forth in this Article IV.
4.2 Each Option shall be evidenced by a written Award Agreement which shall
be subject to and incorporate, by reference or otherwise, the
applicable terms and conditions of the Plan, and any other terms and
conditions not inconsistent with the Plan as may be imposed by the
Committee, including any provisions as to continued employment as
consideration for the grant or exercise of the Option and any
provisions which may be advisable to comply with applicable laws,
regulations or rulings of any governmental authority.
4.3 The Option price per share of Stock shall be established in the Award
Agreement and may be less than 100% of the Fair Market Value at the
Option Grant Date.
4.4 The Option may be exercised in full or in part from time to time within
such period as may be specified by the Committee or in the Award
Agreement; provided, however, that in any event the Option shall lapse
and cease to be exercisable three months following the Participant's
Termination of Employment.
7
<PAGE>
4.5 An Option shall not be transferable by the Participant other than by
will or by the laws of descent and distribution, or, to the extent
otherwise allowed by Rule 16b-3 under the Act or other applicable law,
pursuant to a qualified domestic relations order as defined by the Code
and the Employee Retirement Income Security Act, as amended, and the
rules thereunder, and shall be exercisable during the lifetime of the
Participant only by him or by his guardian or legal representative.
Unless otherwise provided by the Committee or specified in an Award
Agreement, transfer restrictions shall only apply to the extent
required by federal or state securities laws. If any Participant makes
such a transfer in violation hereof, any obligation of the Company
shall forthwith terminate.
4.6 Shares of Stock purchased upon exercise of an Option shall be paid for
in such amounts, at such times and upon such terms as shall be
determined by the Committee, subject to limitations set forth in the
corresponding Award Agreement. Without limiting the foregoing, the
Committee may establish payment terms for the exercise of Options which
permit the Participant to deliver shares of Stock, or other evidence of
ownership of Stock satisfactory to the Company, with a Fair Market
Value equal to the Option price as payment.
4.7 No cash dividends shall be paid on shares of Stock subject to
unexercised Options. The Committee may provide, however, that a
Participant to whom an Option has been granted which is exercisable in
whole or in part at a future time for shares of Stock shall be entitled
to receive an amount per share equal in value to the cash dividends, if
any, paid per share on issued and outstanding Stock, as of the dividend
record dates occurring during the period between the date of the grant
and the time each such share of Stock is delivered pursuant to exercise
of such Option. Such amounts (herein called "dividend equivalents")
may, in the discretion of the Committee, be:
(a) paid in cash or Stock either from time to time prior to, or at
the time of the delivery of, such Stock, or upon expiration of
the Option if it shall not have been fully exercised; or
(b) converted into contingently credited shares of Stock, with
respect to which dividend equivalents may accrue, in such
manner, at such value, and deliverable at such time or times,
as may be determined by the Committee.
Such Stock, whether delivered or contingently credited, shall be
charged against the limitations set forth in Section 3.10.
4.8 The Committee, in its sole discretion, may authorize payment of
interest equivalents on dividend equivalents which are payable in cash
at a future time.
4.9 In the event of Disability or death, the Committee, with the consent of
the Participant or his legal representative, may authorize payment, in
cash or in Stock, or partly in cash and partly in Stock, as the
Committee may direct, of an amount equal to the difference
8
<PAGE>
at the time between the Fair Market Value of the Stock subject to an
Option and the option price in consideration of the surrender of the
Option.
4.10 The Company may make such provisions and take such steps as it may deem
necessary or appropriate for the withholding of any taxes which the
Company is required by any law or regulation of any governmental
authority, whether federal, state or local, domestic or foreign, to
withhold in connection with any Option or the exercise thereof,
including, but not limited to, withholding the issuance of Stock
pursuant to exercise of the Option until the Participant reimburses the
Company for the amount the Company is required to withhold with respect
to such taxes or canceling any portion of the Option or another Option
granted under the Plan in an amount sufficient to reimburse the Company
for the amount the Company is required to so withhold.
4.11 If a Participant is required to pay to the Company an amount with
respect to income and employment tax withholding obligations in
connection with exercise of an Option, the Committee, in its discretion
and subject to such rules as it may adopt, may permit the Participant
to satisfy the obligation, in whole or in part, by making an
irrevocable election that a portion of the total Fair Market Value of
the shares of Stock subject to the Option be paid in the form of cash
in lieu of the issuance of Stock and that such cash payment be applied
to the satisfaction of the withholding obligations. The amount to be
withheld shall not exceed the statutory minimum federal and state
income and employment tax liability arising from the Option exercise
transaction. Notwithstanding any other provision of the Plan, any
election under this Section 4.11 shall be effective only if it
satisfies the applicable requirements of Rule 16b-3 of the Act.
4.12 The Committee may permit the voluntary surrender of all or a portion of
any Option granted under the Plan to be conditioned upon the granting
to the Participant of a new Option for the same or a different number
of shares of Stock as the Option surrendered, or may require such
surrender as a condition precedent to a grant of a new Option to such
Participant. Subject to the provisions of the Plan, such new Option
shall be exercisable at such price, during such period and on such
other terms and conditions as are specified by the Committee at the
time the new Option is granted. Upon surrender, the Options surrendered
shall be canceled and the shares of Stock previously subject to them
shall be available for the grant of other Options.
ARTICLE V - ACCELERATION EVENTS
5.1 For the purposes of the Plan, an Acceleration Event shall occur in the
event of a "Potential Change in Control," or "Change in Control" or a
"Board-Approved Change in Control," as those terms are defined below.
9
<PAGE>
5.2 A "Change in Control" shall be deemed to have occurred if:
(a) Any "Person" as defined in Section 3(a)(9) of the Act,
including a "group" (as that term is used in Sections 13(d)(3)
and 14(d)(2) of the Act), but excluding the Company and any
employee benefit plan sponsored or maintained by the Company,
including any trustee of such plan acting as trustee, who:
(i) makes a tender or exchange offer for any shares of
the Company's Stock (as defined below) pursuant to
which any shares of the Company's Stock are
purchased (an "Offer"); or
(ii) together with its "affiliates" and "associates" (as
those terms are defined in Rule 12b-2 under the Act)
becomes the "Beneficial Owner" (within the meaning of
Rule 13d-3 under the Act) of at least 20% of the
Company's Stock (an "Acquisition");
(b) The stockholders of the Company approve a definitive
agreement or plan to merge or consolidate the Company with or
into another corporation, to sell or otherwise dispose of all
or substantially all of its assets, or to liquidate the
Company (individually, a "Transaction"); or
(c) When, during any period of 24 consecutive months during the
existence of the Plan, the individuals who, at the beginning
of such period, constitute the Board (the "Incumbent
Directors") cease for any reason other than death to
constitute at least a majority thereof; provided, however,
that a director who was not a director at the beginning of
such 24 month period shall be deemed to have satisfied such
24 month requirement, and be an Incumbent Director, if such
director was elected by, or on the recommendation of or with
the approval of, at least two-thirds of the directors who
then qualified as Incumbent Directors either actually,
because they were directors at the beginning of such 24 month
period, or by prior operation of this Section 5.2(c).
5.3 A "Board-Approved Change in Control" shall be deemed to have occurred
if the Offer, Acquisition or Transaction, as the case may be, is
approved by a majority of the Directors serving as members of the Board
at the time of the Potential Change in Control or Change in Control.
5.4 A "Potential Change in Control" means the happening of any one of the
following:
(a) The approval by stockholders of an agreement by the Company,
the consummation of which would result in a Change in Control
of the Company, as defined in Section 5.2; or
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(b) The acquisition of Beneficial Ownership, directly or
indirectly, by any entity, person or group, other than the
Company or any Company employee benefit plan, including any
trustee of such plan acting as such trustee, of securities of
the Company representing five percent or more of the combined
voting power of the Company's outstanding securities and the
adoption by the Board of a resolution to the effect that a
Potential Change in Control of the Company has occurred for
the purposes of this Plan.
5.5 Upon the occurrence of an Acceleration Event, the Committee in its
discretion may declare that any or all then outstanding Options, that
are not already exercisable and fully vested, shall become immediately
exercisable and fully vested in whole or in part.
5.6 In the event of a Change in Control, the Committee may, in its
discretion, cash out the value of all outstanding Options, to the
extent vested, on the basis of the "Change in Control Price" (as
defined in Section 5.7) as of the date such Change in Control or such
Potential Change in Control is determined to have occurred or such
other date as the Committee may determine prior to the Change in
Control, less the Option price (as established in the corresponding
Award Agreements).
5.7 For purposes of Section 5.6, "Change in Control Price" means the
highest price per share of Stock paid in any transaction reported on
the exchange on which the Stock is then traded, or paid or offered in
any bona fide transaction related to a Potential or actual Change in
Control of the Company at any time during the 60 day period immediately
preceding the occurrence of the Change in Control, or, where
applicable, the occurrence of the Potential Change in Control event, in
each case as determined by the Committee.
ARTICLE VI - AMENDMENT AND TERMINATION
6.1 The Board, upon recommendation of the Committee, or otherwise, at any
time and from time to time, may amend or terminate the Plan. To the
extent required by Rule 16b-3 under the Act, no amendment, without
approval by the Company's stockholders, shall:
(a) alter the group of persons eligible to participate in the
Plan;
(b) except as otherwise provided herein, increase the maximum
number of shares of Stock or Options that are available for
award under the Plan;
(c) limit or restrict the powers of the Committee with respect to
the administration of this Plan;
(d) materially increase the benefits accruing to Participants
under this Plan;
(e) materially modify the requirements as to eligibility for
participation in this Plan; or
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(f) change any of the provisions of this Article VI.
6.2 No amendment to or discontinuance of this Plan or any provision thereof
by the Board or the stockholders of the Company shall, without the
written consent of the Participant, adversely affect, as shall be
determined by the Committee, any Option theretofore granted to such
Participant under this Plan; provided, however, the Committee retains
the right and power to:
(a) annul any Option if the Participant is terminated for cause
as determined by the Committee; and
(b) provide for the forfeiture of shares of Stock or other gain
under an Option, as determined by the Committee, in the event
the Participant competes against the Company.
6.3 If an Acceleration Event has occurred, no amendment or termination
shall impair the rights of any person with respect to an outstanding
Option as provided in Article V.
ARTICLE VII - MISCELLANEOUS PROVISIONS
7.1 Nothing in the Plan or any Option granted hereunder shall confer upon
any Participant any right to continue in the employ of the Company, or
to serve as a director thereof, or interfere in any way with the right
of the Company to terminate his or her employment at any time. Unless
specifically provided otherwise, no Option granted under the Plan shall
be deemed salary or compensation for the purpose of computing benefits
under any employee benefit plan or other arrangement of the Company for
the benefit of its employees unless the Company shall determine
otherwise. No Participant shall have any claim to an Option until it is
actually granted under the Plan. To the extent that any person acquires
a right to receive payments from the Company under the Plan, such right
shall, except as otherwise provided by the Committee, be no greater
than the right of an unsecured general creditor of the Company. All
payments to be made hereunder shall be paid from the general funds of
the company, and no special or separate fund shall be established and
no segregation of assets shall be made to assure payment of such
amounts, except as otherwise provided by the Committee.
7.2 The Plan and the grant of Options hereunder shall be subject to all
applicable federal and state laws, rules, and regulations and to such
approvals by any United States government or regulatory agency as may
be required. Any provision herein relating to compliance with Rule
16b-3 under the Act shall not be applicable with respect to
participation in the Plan by Participants who are not subject to
Section 16(b) of the Act.
7.3 The terms of the Plan shall be binding upon the Company and its
successors and assigns.
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7.4 This Plan and all actions taken hereunder shall be governed by the laws
of the State of North Carolina.
7.5 The Plan is intended to constitute an "unfunded" plan for incentive and
deferred compensation. With respect to any payments not yet made to a
Participant by the Company, nothing contained herein shall give any
such Participant any rights that are greater than those of a general
creditor of the Company. In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the
obligations created under the Plan to deliver shares of Stock or
payments in lieu of or with respect to Options granted hereunder;
provided, however, that, unless the Committee otherwise determines with
the consent of the affected Participant, the existence of such trusts
or other arrangements is consistent with the "unfunded" status of the
Plan.
7.6 Each Participant exercising an Option hereunder agrees to give the
Committee prompt written notice of any election made by such
Participant under Section 83(b) of the Code, or any similar provision
thereof.
7.7 If any provision of this Plan or an Award Agreement is or becomes or is
deemed invalid, illegal or unenforceable in any jurisdiction, or would
disqualify the Plan or any Award Agreement under any law deemed
applicable by the Committee, such provision shall be construed or
deemed amended to conform to applicable laws or if it cannot be
construed or deemed amended without, in the determination of the
Committee, materially altering the intent of the Plan or the Award
Agreement, it shall be stricken and the remainder of the Plan or the
Award Agreement shall remain in full force and effect.
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