UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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CLUB CORPORATION INTERNATIONAL
(Exact name of Registrant as specified in its charter)
NEVADA 75-1311242
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3030 LBJ FREEWAY, DALLAS, TEXAS 75234, (972) 243-6191
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
CLUB CORPORATION INTERNATIOAL
OMNIBUS STOCK PLAN
(Full title of Plan)
JAMES P. McCOY, JR.
EXECUTIVE VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
3030 LBJ FREEWAY, SUITE 700
DALLAS, TEXAS 75234
(972) 243-6191
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
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Titles of Each Proposed Proposed
Class of Securities Amount to be Maximum Offering Maximum Aggregate Amount of
to be Registered Registered Price Per Share Offering Price (1) Registration Fee
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Common Stock,
.01 par value 4,000,000 shares $ 5.37 (1) $ 21,480,000 $ 6,337
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(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(h)(1) of the Securities Act of 1933, as amended, based
on book value of the Common Stock as of March 25, 1998, the latest practicable
date prior to the date of filing this Registration Statement.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
ITEM 1. PLAN INFORMATION.
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Not required to be filed with this Registration Statement.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
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Not required to be filed with this Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
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The following documents filed with the Securities and Exchange Commission
(the "Commission") are incorporated by reference in this Registration Statement,
except to the extent that any statement or information therein is modified or
superseded by a statement or information contained in any other subsequently
filed document incorporated herein by reference. Any statement so modified will
not be deemed a part of this Registration Statement, except as so modified, and
any statement so superseded will not be deemed part of this Registration
Statement:
(a) The Registrant's latest Annual Report on Form 10-K for the year ended
December 31, 1997, filed pursuant to Sections 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), which contains audited
financial statements for the Registrant's latest fiscal year.
(b) The Registrant's latest Quarterly Report on Form 10-Q for the
quarterly period ended March 25, 1998, filed pursuant to the Exchange Act.
(c) All other reports filed by the Registrant pursuant to Sections 13(a)
or 15(d) of the Exchange Act since the end of the year covered by the audited
financial statements contained in the Annual Report referred to in (a) above.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment to this Registration Statement which indicates that all
of the securities have been sold or which deregisters all 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.
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Registrant's authorized capital stock consists of 100,000,000 shares of
Common Stock, par value $.01 per share. As of March 25, 1998, there were
85,003,839 shares of Common Stock outstanding and approximately 320 stockholders
of record. Holders of Common Stock are entitled to receive dividends when, as
and if declared by the Board of Directors from funds legally available therefor.
Each share of Common Stock entitles the holder thereof to one vote. Cumulative
voting for the election of directors is not permitted, which means that the
holders of a majority of shares voting for the election of directors can elect
all members of the Board of Directors. Except as otherwise required by
applicable law, a majority vote is sufficient for any action that requires the
vote or concurrence of stockholders. Holders of Common Stock do not have any
subscription, redemption or conversion rights. However, the trustees of the
ClubCorp Stock Investment Plan ("SIP") have the right to require the Registrant
to purchase the Common Stock held by the SIP at the current appraised value as
necessary to meet the requirements of the Employment Retirement Income Security
Act and the SIP. Common Stock issued hereunder is not subject to statutory or
other preemptive rights. Upon liquidation of Registrant, the holders of Common
Stock are entitled to share ratably in the net assets of Registrant remaining
after payment of liabilities. All shares of Common Stock issued and outstanding
are fully paid and non-assessable. Registrant has never paid dividends on the
Common Stock, and no such dividends should be expected in the foreseeable
future. Registrant expects to continue its policy of retaining earnings for use
in its business.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL.
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Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
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Registrant and many of its subsidiaries have adopted charter and/or bylaw
provisions that require such corporations to indemnify, to the maximum extent
permissible under applicable law, each of their directors, officers, employees
and agents against any liability that they may incur in connection with or
resulting from any threatened, pending or completed legal proceeding inquiry or
investigation by reason of the fact that any such person is or was a director,
officer, employee or agent of the corporation. Registrant has authority under
Section 78.751 of Nevada General Corporation Law (the "NGCL") to indemnify its
directors, officers, employees and agents to the extent provided in such
statute. The Articles of Incorporation, as amended, of Registrant (the
"Articles"), provide for indemnification of such persons to the full extent
permitted by the NGCL. The Articles also limit or eliminate the liabilities of
directors and officers to Registrant and its stockholders in certain
circumstances.
As permitted by the NGCL, Registrant maintains an executive liability and
indemnification insurance policy with a limit of liability of $5 million per
policy period. The insurance policy generally covers the wrongful acts of the
directors and officers of Registrant and its subsidiaries (excluding Franklin
Federal Bancorp, a Federal Savings Bank and First Federal Financial
Corporation). The policy coverage is subject to a number of exclusions, which
include: (1) violations of federal or state securities laws; (2) violations of
federal or state antitrust laws; (3) violations of federal or state
environmental laws; (4) violations of the Employee Retirement Income Security
Act of 1974, as amended; (5) libel or slander; and (6) stockholder derivative
actions. Registrant purchases such insurance policy on an annual basis, with the
current policy period expiring on October 19, 1998.
ITEM 7. EXEMPTION FOR REGISTRATION CLAIMED.
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Not applicable.
ITEM 8. EXHIBITS.
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The Exhibits to this Registration Statement are listed in the Index to
Exhibits of this Registration Statement, which Index is incorporated herein by
reference.
ITEM 9. UNDERTAKINGS.
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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, as amended (the "Act");
(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 (1)(I) and (1)(ii) above 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(a) or Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Act, 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.
The undersigned Registrant hereby undertakes that for purposes of
determining any liability under the Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described in Item 6, or otherwise, the Registrant has
been advised that in the opinion of the 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.
<PAGE>
Signatures
Pursuant to the requirements of the Securities Act of 1933, the trustees who
administer the Club Corporation International Omnibus Stock Plan have duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Dallas, State of Texas,
on this 18th day of June, 1998.
CLUB CORPORATION INTERNATIONAL OMNIBUS STOCK PLAN
CLUB CORPORATION INTERNATIONAL
Plan Administrator
By: /s/ Kim S. Besse
Name: Kim S. Besse
Title: Plan Administrator
<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 Dallas, State of Texas, on this 18th day of June,
1998.
CLUB CORPORATION INTERNATIONAL
By: /s/ James P. McCoy, Jr.
Name: James P. McCoy, Jr.
Title: Chief Financial Officer and
Executive Vice President
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INDEX TO EXHIBITS
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Exhibit
Number Exhibit
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4.1 Articles of Incorporation, as amended, of
Club Corporation International (Filed as
Exhibit 3.1 to the Registrant's Registration
Statement on Form S-1 Registration
No. 33-83496)
4.2 Bylaws, as amended, of Club Corporation
International (Filed as Exhibit 3.2 to the
Registration Statement on Form S-1
Registration No. 33-83496)
4.3 Club Corporation International Omnibus Stock Plan
5.1 Opinion of Hughes & Luce, L.L.P.
15.1 Letter from KPMG Peat Marwick LLP
regarding unaudited interim financial
statements
23.1 Consent of Hughes & Luce, L.L.P.
(contained in Exhibit 5.1)
23.2 Consent of KPMG Peat Marwick LLP
24.1 Power of Attorney
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Exhibit 4.3
CLUB CORPORATION INTERNATIONAL
OMNIBUS STOCK PLAN
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TABLE OF CONTENTS
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SECTION 1. DEFINITIONS 1
SECTION 2. STOCK AND MAXIMUM NUMBER OF SHARE SUBJECT TO THE PLAN 5
2.1 Maximum Number of Shares 5
2.2 Individual Limitation on Maximum Shares 5
2.3 Limitation of Shares 5
2.4 Description of Shares 6
SECTION 3. ADMINISTRATION OF THE PLAN 6
3.1 Committee 6
3.2 Duration, Removal, Etc. 6
3.3 Meetings and Actions of Committee 7
3.4 Committee's Powers 7
SECTION 4. ELIGIBILITY AND PARTICIPATION 8
4.1 Eligible Individuals 8
4.2 Grant of Awards 8
4.3 Agreements 8
4.4 No Right to Award 8
SECTION 5. ADJUSTMENT PROVISIONS 8
5.1 Adjustment of Awards and Authorized Stock 8
5.2 Change in Control 9
5.3 Golden Parachute Limitation 10
SECTION 6. MISCELLANEOUS PROVISIONS 10
6.1 Term of Award 10
6.2 Transferability of Awards 10
6.3 Cash Out Feature 11
6.4 Forfeiture and Restrictions on Transfer 11
6.5 Conditions to Delivery of Stock 12
6.6 Payment with Sale Proceeds 13
6.7 Certain Directors and Officers 13
6.8 Rights as a Shareholder 13
6.9 Furnish Information 14
6.10 Obligation to Exercise 14
6.11 Adjustments to Awards 14
6.12 Remedies 14
6.13 Information Confidential 14
6.14 Consideration 14
SECTION 7. DURATION AND AMENDMENT OF PLAN 15
7.1 Duration 15
7.2 Amendment 15
SECTION 8. GENERAL 15
8.1 Application of Funds 15
8.2 Right of the Corporation and Affiliates to Terminate Employment 15
8.3 No Liability for Good Faith Determinations 15
8.4 Other Benefits 15
8.5 Exclusion From Pension and Profit-Sharing Compensation 16
8.6 Agreement Requirements 16
8.7 Beneficiary Designation 16
8.8 Execution of Receipts and Releases 16
8.9 Unfunded Plan 16
8.10 No Guarantee of Interests 17
8.11 Payment of Expenses 17
8.12 Corporation Records 17
8.13 Information 17
8.14 No Liability of Corporation 17
8.15 Corporation Action 17
8.16 Arbitration 17
8.17 Severability 18
8.18 Notices 18
8.19 Successors 18
8.20 Headings 19
8.21 Governing Law 19
8.22 Word Usage 19
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CLUB CORPORATION INTERNATIONAL
OMNIBUS STOCK PLAN
SCOPE AND PURPOSE OF PLAN
Club Corporation International, a Nevada corporation has adopted the Club
Corporation International Omnibus Stock Plan to provide for the granting of
various forms of stock based compensation including:
(a) Options to certain key employees and other persons;
(b) Phantom Shares to certain key employees and other persons;
(c) Stock Appreciation Rights to certain key employees and other persons;
and
(d) Restricted Stock to certain key employees and other persons.
The purpose of the Plan is to provide an incentive for key employees of the
Corporation or its Affiliates so that they will apply their best efforts for the
benefit of the Corporation, to encourage them to remain in the service of the
Corporation and its Affiliates; to extend to them the opportunity to acquire a
proprietary interest in the Corporation; and to aid the Corporation and its
Affiliates in attracting able persons to enter the service of the Corporation
and its Affiliates. The Plan is not intended to be a plan subject to the
Employee Retirement Income Security Act of 1974, as amended and shall be
construed accordingly.
SECTION 1. DEFINITIONS
1.1 "ACT" means the Securities Exchange Act of 1934, as amended or any
similar or superseding statute or statutes.
1.2 "AFFILIATES" means any entity that is, directly or indirectly, 50%
or more owned by the Corporation.
1.3 "AWARD" means the grant of any form of Option, Stock Appreciation
Right, Phantom Share or Restricted Stock share under the Plan, whether granted
individually, in combination, or in tandem, to a Holder pursuant to the terms,
conditions, and limitations that the Committee may establish in order to fulfill
the objectives of the Plan.
1.4 "AGREEMENT" means the written agreement between the Corporation and
a Holder evidencing the terms, conditions, and limitations of the Award granted
to that Holder.
1.5 "BOARD OF DIRECTORS" means the board of directors of the
Corporation.
1.6 "CAUSE" shall be as defined in any effective contract of employment
between the Holder and the Corporation or Affiliate.
1.7 "CHANGE IN CONTROL" means the event that is deemed to have occurred
if:
(a) a dissolution or liquidation of the Corporation;
(b) a merger or consolidation (other than a merger effecting a
re-incorporation of the Corporation in another state or any other merger or a
consolidation in which the shareholders of the surviving corporation and their
proportionate interests therein immediately after the merger or consolidation
are substantially identical to the shareholders of the Corporation and their
proportionate interests therein immediately prior to the merger or
consolidation) in which the Corporation is not the surviving corporation (or
survives only as a subsidiary of another corporation in a transaction in which
the shareholders of the parent of the Corporation and their proportionate
interests therein immediately after the transaction are not substantially
identical to the shareholders of the Corporation and their proportionate
interests therein immediately prior to the transaction; provided, however, that
the Board of Directors may at any time prior to such a merger or consolidation
provide by resolution that the foregoing provisions of this parenthetical shall
not apply if a majority of the Board of Directors of such parent immediately
after the transaction consists of individuals who constituted a majority of the
Board of Directors immediately prior to the transaction); or
(c) a transaction in which any person (other than a shareholder of the
Corporation on the date of the Holder's Agreement) becomes the owner of fifty
percent (50%) or more of the total combined voting power of all classes of stock
of the Corporation (provided, however, that the Board of Directors may at any
time prior to such transaction provide by resolution that this SUBSECTION shall
not apply if such acquiring person is a corporation and a majority of the Board
of Directors of the acquiring corporation immediately after the transaction
consists of individuals who constituted a majority of the Board of Directors
immediately prior to the acquisition of such fifty percent (50%) or more total
combined voting power).
1.8 "CODE" means the Internal Revenue Code of 1986, as amended.
1.9 "COMMITTEE" means the committee appointed pursuant to SECTION 3 of
the Plan by the Board of Directors to administer this Plan.
1.10 "CORPORATION" means Club Corporation International and any
successor corporation.
1.11 "DISABILITY" or "DISABLED" means a total and permanent disability
as defined in the Corporation's current long term disability plan, or if the
Committee has no long term disability plan in effect at the time of the Holder's
disability, as determined by the Committee in its sole discretion.
1.12 "DIVIDEND" means the aggregate amount declared as a dividend on
Stock, as determined in the sole discretion of the Board of Directors.
1.13 "ELIGIBLE INDIVIDUALS" means those employees designated by the
Committee as key employees of the Corporation or any of its Affiliates.
1.14 "EXERCISE NOTICE" means the written notice of exercise delivered
to the Corporation during the term of the Award, which shall (a) state the
number of shares of Stock with respect to which the Award is being exercised,
(b) be signed by the Holder of the Award or, if the Holder is dead or becomes
affected by a Disability, by the person authorized to exercise the Award
pursuant to SECTION 8.7, (c) be accompanied by the Exercise Price (if any) for
all shares of Stock for which the Award is being exercised, and (d) include such
other information, instruments, and documents as may be required to satisfy any
other condition of exercise contained in the Agreement.
1.15 "EXERCISE PRICE" means the price at which an Award can be
exercised as specified in the Agreement covering such Award.
1.16 "FAIR MARKET VALUE" means, for a particular day:
(a) If shares of Stock of the same class are listed or admitted to
unlisted trading privileges on any national or regional securities exchange or
sales prices for such shares in the over-the-counter market are reported by the
National Association of Securities Dealers, Inc. Automated Quotations, Inc.
("NASDAQ") National Market System at the date of determining the Fair Market
Value, the mean between the highest and lowest quoted selling prices on the date
in question, or if there were no sales on the date in question, the weighted
average of the means between the highest and lowest sales on the nearest date
before and the nearest date after the date in question; or
(b) If shares of Stock of the same class shall not be listed or
admitted to unlisted trading privileges as provided in SUBSECTION 1.16(A) and
sales prices for such shares shall not be reported by the NASDAQ National Market
System as provided in SUBSECTION 1.16(A), and bid and asked prices therefor in
the over-the-counter market shall be reported by NASDAQ (or, if not so reported,
by the National Quotation Bureau Incorporated) at the date of determining the
Fair Market Value, the mean of the closing bid and asked prices on the date in
question, or if none, by taking a weighted average of the means between the bid
and asked prices on the nearest trading date before and the nearest trading date
after the date in question, if both such dates are within a reasonable period;
and
(c) If shares of Stock of the same class shall not be listed or
admitted to unlisted trading privileges as provided in SUBSECTION 1.16(A) and
sales prices or bid and asked prices for such shares shall not be reported by
NASDAQ (or the National Quotation Bureau Incorporated) as provided in SUBSECTION
1.16(A) or SUBSECTION 1.16(B) at the date of determining the Fair Market Value,
or in the opinion of the Board of Directors, there is insufficient trading to
establish fair market value, the value determined in good faith by the Board of
Directors and confirmed by an independent financial advisory firm.
1.17 "HOLDER" means an Eligible Individual to whom an outstanding Award
has been granted.
1.18 "OPTION" means a stock option that does not satisfy the
requirements of Code Section 422.
1.19 "OUTSIDE DIRECTOR" has the meaning given to it in Code Section
162(m) and the regulations thereunder.
1.20 "PHANTOM SHARE(S)" means the share(s) granted to a Holder which
entitle the Holder to receive payment of an amount equal to the Fair Market
Value of a share of Stock on the date of exercise.
1.21 "PLAN" means the Club Corporation International Omnibus Stock
Plan, as amended from time to time.
1.22 "RESTRICTED STOCK" means Stock granted to Eligible Individuals
pursuant to the Plan which is subject to certain restrictions as to its
transferability.
1.23 "RULE 16B-3" means Rule 16b-3 under Section 16(b) of the Act as
adopted in Act Release No. 34-29131 (April 26, 1991), and amended in Act Release
No. 37260 (May 31, 1996), or any successor rule, as amended from time to time.
1.24 "SECURITIES ACT" means the Securities Act of 1933 and the rules
and regulations promulgated thereunder, or any successor law, as it may be
amended from time to time.
1.25 "STOCK" means the common stock, $.01 par value per share, of Club
Corporation International.
1.26 "STOCK APPRECIATION RIGHT" means the right to receive payment of
an amount equal to the excess of the Fair Market Value of a share of Stock (as
determined on the date of exercise) over, as appropriate, the Exercise Price of
a related Option or the Fair Market Value of the Stock on the date of grant of
the Stock Appreciation Right.
1.27 "TERMINATION" means a Holder's termination of employment with the
Corporation for any reason.
SECTION 2. STOCK AND MAXIMUM NUMBER OF SHARES SUBJECT TO PLAN
2.1 MAXIMUM NUMBER OF SHARES. Subject to the provisions of SECTION
2.2, 5, and 6.11, the aggregate number of shares of Stock that may be issued
or transferred pursuant to Awards under the Plan shall be four million
(4,000,000) shares.
2.2 INDIVIDUAL LIMITATION ON MAXIMUM SHARES The aggregate number of
shares of Stock subject to an Award that may be issued or transferred to any
single Eligible Individual in a calendar year under the Plan shall be five
hundred thousand (500,000) shares.
2.3 LIMITATION OF SHARES. For purposes of the limitations specified
in SECTIONS 2.1 and 2.2, the following principles shall apply:
(a) the following shall count against and decrease the number of shares
of Stock that may be issued for purposes of SECTIONS 2.1 and 2.2: (i) shares of
Stock subject to outstanding Options (granted under this Plan), shares of Stock
subject to outstanding Phantom Shares (based on a good faith estimate by the
Corporation or the Committee of the maximum number of shares for which the
Phantom Shares may be settled (assuming payment in full in shares of Stock)),
and shares of Stock subject to outstanding Stock Appreciation Rights granted
independent of Options, (based on a good faith estimate by the Corporation or
the Committee of the maximum number of shares for which the Stock Appreciation
Right may be settled (assuming payment in full in shares of Stock)), and (ii) in
the case of Options granted in tandem with Stock Appreciation Rights, the
greater of the number of shares of Stock that would be counted if one or the
other alone was outstanding (determined as described in clause (i) above);
(b) the following shall be added back to the number of shares of Stock
that may be issued for purposes of SECTION 2.1 only: (i) shares of Stock with
respect to which Options (granted under this Plan), Phantom Shares, and Stock
Appreciation Rights granted independent of Options, expire, are canceled, or
otherwise terminate without being exercised, converted, or vested, as
applicable, and (ii) in the case of Options granted in tandem with Stock
Appreciation Rights, shares of Stock as to which an Option has been surrendered
in connection with the exercise of a related ("tandem") Stock Appreciation
Right, to the extent the number surrendered exceeds the number issued upon
exercise of the Stock Appreciation Right;
(c) shares of Stock subject to Stock Appreciation Rights (granted
independent of Options) or Phantom Shares (calculated as provided in clause (a)
above) that are exercised and paid in cash shall be added back to the number of
shares of Stock that may be issued for purposes of SECTION 2.1 only;
(d) shares of Stock that are transferred by a Holder of an Award (or
withheld by the Corporation) as (i) full or partial payment to the Corporation
of the purchase price of shares of Stock subject to an Option or (ii) the
Corporation's or any Affiliate's tax withholding obligations shall not be added
back to the number of shares of Stock that may be issued for purposes of
SECTIONS 2.1 and 2.2 and shall not again be subject to Awards; and
(e) if the number of shares of Stock counted against the number of
shares that may be issued for purposes of SECTION 2.1 and 2.2 is based upon an
estimate made by the Corporation or the Committee as provided in clause (a)
above and the actual number of shares of Stock issued pursuant to the applicable
Award is greater or less than the estimated number, then, upon such issuance,
the number of shares of Stock that may be issued pursuant to SECTION 2.1 and 2.2
shall be further reduced by the excess issuance or increased by the shortfall,
as applicable.
Notwithstanding the provisions of this SECTION 2.3, no Stock shall be treated as
issuable under the Plan to Eligible Individuals subject to Section 16 of the Act
if otherwise prohibited from issuance under Rule 16b-3.
2.4 DESCRIPTION OF SHARES. The shares of Stock to be delivered under
the Plan shall be made available from: (a) authorized but unissued shares
of Stock; (b) Stock held in the treasury of the Corporation; or (c) previously
issued shares of Stock reacquired by the Corporation, including shares
purchased on the open market, in each situation as the Board of Directors or
the Committee may determine from time to time in its sole discretion.
SECTION 3. ADMINISTRATION OF THE PLAN
3.1 COMMITTEE. The Committee shall administer the Plan with respect to
all Eligible Individuals (other than members of the Committee), but shall not
have the power to appoint members of the Committee or to terminate or amend the
Plan. The Board of Directors shall administer the Plan with respect to all
members of the Committee who are Eligible Individuals, if any. Except for
references in SECTIONS 3.1, 3.2 and 3.3, and unless the context otherwise
requires, references herein to the Committee shall also refer to the Board of
Directors as administrator of the Plan for members of the Committee who are
Eligible Individuals, if any. In the event that the Stock is registered under
Section 12 of the Act, all members of the Committee shall be Outside Directors.
The number of persons that shall constitute the Committee shall be determined
from time to time by a majority of all the members of the Board of Directors
and, unless that majority of the Board of Directors determines otherwise or Rule
16b-3 is amended to require otherwise, shall be no less than two persons. To the
extent that Rule 16b-3 promulgated under the Act requires a system of
administration that is different from this SECTION 3.1, this SECTION 3.1 shall
automatically be deemed amended to the extent necessary to cause it to be in
compliance with Rule 16b-3.
3.2 DURATION, REMOVAL, ETC The members of the Committee shall serve at
the discretion of the Board of Directors, which shall have the power, at any
time and from time to time, to remove members from or add members to the
Committee. Removal from the Committee may be with or without cause. Any
individual serving as a member of the Committee shall have the right to resign
from membership in the Committee by at least three days' written notice to the
Board of Directors. The Board of Directors, and not the remaining members of
the Committee, shall have the power and authority to fill all vacancies on the
Committee. The Board of Directors shall, within sixty (60) days, fill any
vacancy that causes the number of members of the Committee to be below two or
any other number that Rule 16b-3 or Code Section 162(m) may require from time to
time.
3.3 MEETINGS AND ACTIONS OF COMMITTEE. The Board of Directors shall
designate which of the Committee members shall be the chairman of the Committee.
If the Board of Directors fails to designate a Committee chairman, the members
of the Committee shall elect one of the Committee members as chairman, who shall
act as chairman until he ceases to be a member of the Committee or until the
Board of Directors elects a new chairman. The Committee shall hold its meetings
at those times and places as the chairman of the Committee may determine. At
all meetings of the Committee, a quorum for the transaction of business shall be
required and a quorum shall be deemed present if at least a majority of the
members of the Committee are present. At any meeting of the Committee, each
member shall have one vote. All decisions and determinations of the Committee
shall be made by the majority vote or majority decision of all of its members
present at a meeting at which a quorum is present; provided, however, that any
decision or determination reduced to writing and signed by all of the members of
the Committee shall be as fully effective as if it had been made at a meeting
that was duly called and held. The Committee may make any rules and regulations
for the conduct of its business that are not inconsistent with the provisions of
the Plan, the Articles or Certificate of Incorporation of the Corporation, the
by-laws of the Corporation, and Rule 16b-3 so long as it is applicable, as the
Committee may deem advisable.
3.4 COMMITTEE'S POWERS. Subject to the express provisions of the Plan
and Rule 16b-3, the Committee shall have the authority, in its sole and absolute
discretion, to: (a) adopt and rescind administrative and interpretive rules and
regulations relating to the Plan; (b) determine the Eligible Individuals to
whom, and the time or times at which, Awards shall be granted; (c) determine the
amount of cash and the number of shares of Stock, Stock Appreciation Rights,
Phantom Shares or shares of Restricted Stock, or any combination thereof, that
shall be the subject of each Award; (d) determine the terms and provisions of
each Award (which need not be identical), including provisions defining or
otherwise relating to (i) the term and the period or periods and extent of
exercisability of the Awards, (ii) the extent to which the transferability of
shares of Stock issued or transferred pursuant to any Award is restricted, (iii)
the effect of Holder's Termination on the Agreement, and (iv) the effect of
approved leaves of absence (consistent with applicable law) (e) accelerate the
exercisability of any Award that has been granted; (f) construe the respective
Awards and the Plan; (g) make determinations of the Fair Market Value of the
Stock pursuant to the Plan; (h) delegate its duties under the Plan to such
agents as it may appoint from time to time, provided that the Committee may not
delegate its duties with respect to making Awards to, or otherwise with respect
to Awards granted to Eligible Individuals who are subject to Section 16(b) of
the Act or Section 162(m) of the Code; and (i) make all other determinations,
perform all other acts, and exercise all other powers and authority necessary or
advisable for administering the Plan, including the delegation of those
ministerial acts and responsibilities as the Committee deems appropriate.
Subject to Rule 16b-3 and Code Section 162(m), the Committee may correct any
defect, supply any omission, or reconcile any inconsistency in the Plan or in
any Award in the manner and to the extent it deems necessary or desirable to
carry the Plan into effect, and the Committee shall be the sole and final judge
of that necessity or desirability. The determinations of the Committee on the
matters referred to in this SUBSECTION 3.4 shall be final and conclusive.
SECTION 4. ELIGIBILITY AND PARTICIPATION
4.1 ELIGIBLE INDIVIDUALS Eligible Individuals at the time of the grant
thereof and shall be made in whatever form the Committee in its sole discretion
may determine including Options, Phantom Shares, Stock Appreciation Rights and
Restricted Stock.
4.2 GRANT OF AWARDS. Subject to the express provisions of the Plan,
the Chief Executive Officer (CEO) and the Chief Operations Officer of Domestic
Operations (COO-DO) shall determine which Eligible Individuals shall be granted
Awards during the period from the effective date of the Plan through June 30,
1998. After June 30, 1998, the Committee shall determine which Eligible
Individuals shall be granted Awards from time to time. The Board of Directors
shall also have the power to grant Awards, subject to the requirements of Rule
16b-3. References to the Committee throughout the remainder of this SECTION 4.2
and SECTION 4.3 shall mean the CEO, COO-DO, Board of Directors or the Committee,
as appropriate. In making grants, the Committee shall take into consideration
the contribution the potential Holder has made or may make to the success of the
Corporation or its Affiliates and such other considerations as the Board of
Directors may from time to time specify. The Committee shall also determine the
number of shares subject to each of the Awards and shall authorize and cause the
Corporation to grant Awards in accordance with those determinations. All grants
to Eligible Individuals who are "covered employees" under Code Section 162(m)
shall be subject to shareholder approval sufficient to satisfy the requirements
of Code Section 162(m). Notwithstanding any provision to the contrary, an Award
shall be void if the Holder is not an Eligible Individual.
4.3 AGREEMENTS. Each Award granted under the Plan shall be evidenced
by an Agreement that is executed by the Corporation and the Eligible Individual
to whom the Award is granted and shall incorporate the terms and conditions of
such Award as the Committee shall deem necessary or desirable. More than one
Award may be granted under the Plan to the same Eligible Individual and be
outstanding concurrently.
4.4 NO RIGHT TO AWARD. The adoption of the Plan shall not be deemed to
give any person a right to be granted an Award.
SECTION 5. ADJUSTMENT PROVISIONS
5.1 ADJUSTMENT OF AWARDS AND AUTHORIZED STOCK. The terms of an Award
and the number of shares of Stock authorized pursuant to SECTION 2.1 shall be
subject to adjustment from time to time, in accordance with the following
provisions:
(a) If at any time, or from time to time, the Corporation shall
subdivide as a whole (by reclassification, by a Stock split, by the issuance of
a distribution on Stock payable in Stock, or otherwise) the number of shares of
Stock then outstanding into a greater number of shares of Stock, then (i) the
maximum number of shares of Stock available for the Plan as provided in SECTION
2.1 shall be increased proportionately, and the kind of shares or other
securities available for the Plan shall be appropriately adjusted, (ii) the
number of shares of Stock (or other kind of shares or securities) that may be
acquired under any Award shall be increased proportionately, and (iii) the price
(including Exercise Price) for each share of Stock (or other kind of shares or
securities) subject to then outstanding Awards shall be reduced proportionately,
without changing the aggregate purchase price or value as to which outstanding
Awards remain exercisable or subject to restrictions.
(b) If at any time, or from time to time, the Corporation shall
consolidate as a whole (by reclassification, reverse Stock split, or otherwise)
the number of shares of Stock then outstanding into a lesser number of shares of
Stock, then (i) the maximum number of shares of Stock available for the Plan as
provided in SECTION 2.1 shall be decreased proportionately, and the kind of
shares or other securities available for the Plan shall be appropriately
adjusted, (ii) the number of shares of Stock (or other kind of shares or
securities) that may be acquired under any Award shall be decreased
proportionately, and (iii) the price (including Exercise Price) for each share
of Stock (or other kind of shares or securities) subject to then outstanding
Awards shall be increased proportionately, without changing the aggregate
purchase price or value as to which outstanding Awards remain exercisable or
subject to restrictions.
(c) Whenever the number of shares of Stock subject to outstanding
Awards and the price for each share of Stock subject to outstanding Awards are
required to be adjusted as provided in this SUBSECTION 5.1(C), the Committee
shall promptly prepare a notice setting forth, in reasonable detail, the event
requiring adjustment, the amount of the adjustment, the method by which such
adjustment was calculated, and the change in price and the number of shares of
Stock, other securities, cash, or property purchasable subject to each Award
after giving effect to the adjustments. The Committee shall promptly give each
Holder (or his transferee) such a notice.
(d) Adjustments under SUBSECTIONS 5.1(A) and (B) shall be made by the
Committee, and its determination as to what adjustments shall be made and the
extent thereof shall be final, binding, and conclusive. No fractional interest
shall be issued under the Plan on account of any such adjustments.
5.2 CHANGE IN CONTROL. As of the effective date of a Change in Control,
the Board of Directors shall change the number and kind of shares of Stock
subject to any Award (including substitution of shares of another corporation),
and the Exercise Price thereof, in the manner it deems appropriate as determined
in its sole discretion.
5.3 GOLDEN PARACHUTE LIMITATION. In the event that Code Section 280G
applies to any Award and the aggregate present value of the benefits to a Holder
under the Plan, and any other plan, program, or arrangement maintained by the
Corporation constitutes an "excess parachute payment" (within the meaning of
Code Section 280G(b)(i)) and the excise tax on such payment would cause the net
parachute payments (after taking into account federal, state and local income
and excise taxes) to which the Holder otherwise would be entitled to be less
than what the Holder would have netted (after taking into account federal, state
and local income taxes) had the present value of his total parachute payments
equaled $1.00 less than three times his "base amount" (within the meaning of
Code Section 280G(b)(3)(A)), the Holder's total "parachute payments" (within the
meaning of Code Section 280G(b)(2)(A)) shall be reduced (by the minimum possible
amount) so that their aggregate present value equals $1.00 less than three times
such base amount. For purposes of this calculation, it shall be assumed that
the Holder's tax rate will be the maximum marginal federal, state and local
income tax rate on earned income with such maximum federal rate to be computed
with regard to Code Section 1(g), if applicable. In the event that the Holder
and the Corporation are unable to agree as to the amount of the reduction
described above, if any, the Corporation shall select a law firm or accounting
firm from among those regularly consulted by the Corporation regarding federal
income tax or employee benefit matters and such law firm or accounting firm
shall determine the amount of such reduction and such determination shall be
final and binding upon the Holder and the Corporation.
SECTION 6. MISCELLANEOUS PROVISIONS
6.1 TERM OF AWARD. The provisions of this SECTION shall apply to
the extent a Holder's Agreement does not expressly provide otherwise. If a
Holder ceases to be an Eligible Individual due to Termination for Cause or due
to a voluntary Termination of employment, the Award shall terminate immediately
upon the Holder's Termination. If a Holder ceases to be an Eligible Individual
by reason of: (a) Disability; (b) retirement on or after age sixty-five (65); or
(c) involuntary Termination for a reason other than for Cause, the Holder shall
have the right for twelve (12) months after the date of his involuntary
Termination, retirement on or after age sixty-five (65) or Disability to
exercise an Award to the extent such Award is exercisable on the date of his
involuntary Termination, Disability, or retirement on or after age sixty-five
(65). If a Holder ceases to be an Eligible Individual by reason of death,
Holder's designated beneficiary shall have the right for twelve (12) months
after the date of death to exercise the Award, to the extent such Award is
exercisable on the date of death. At the end of such twelve (12) month period,
the Award shall terminate and cease to be payable or exercisable.
Notwithstanding any other provision of this Plan or Agreements, no Award shall
be payable or exercisable after the expiration of ten (10) years from the date
it is granted.
6.2 TRANSFERABILITY OF AWARDS. In addition to such other terms and
conditions as may be included in a particular Agreement granting an Award, an
Award shall be exercisable during a Holder's lifetime only by the Holder or by
the Holder's guardian or legal representative. An Award shall not be
transferrable other than by will or the laws of descent and distribution.
Notwithstanding the previous paragraph, the Committee may, in its
discretion, authorize all or a portion of an Award to be granted on terms which
permit transfer by the Holder to: (i) the Holder's spouse, children,
stepchildren, grandchildren, step grandchildren, parents, stepparents, siblings
or step siblings ("Immediate Family Members"); (ii) a trust or trusts for the
exclusive benefit of such Immediate Family Members; (iii) a partnership in which
such Immediate Family Members are the only partners; or (iv) other persons as
the Committee may permit, provided that the Agreement pursuant to which such
Award is granted must be: (a) approved by the Committee; (b) expressly provide
for transferability in a manner consistent with this SECTION 6.2; (c) contain
representation by the Holder that he understands the effect of such transfer;
and (d) release the Committee from any liability in connection with such
transfer. Subsequent transfers shall be prohibited except transfers to other
Immediate Family Members and transfers by will or the laws of descent and
distribution. Following such transfer, any such Award shall continue to be
subject to the same terms and conditions as were applicable immediately prior to
transfer. The events of Termination of SECTION 6.1 shall continue to apply with
respect to the original Holder, following which the Award shall be exercisable
by the transferee only to the extent and for the period specified in SECTION
6.1.
6.3 CASH OUT FEATURE. Upon Holder's Termination or his ceasing to be
employed in a position that has been designated by the Committee as a key
employee position, the Corporation shall have the right at any time thereafter,
in its sole discretion, to cancel any Award by paying Holder a cash amount that
is equal to: (i) the difference between an Option's Exercise Price and the then
Fair Market Value of the Stock times the number of shares covered by the
unexercised vested portion of such Holder's Option; (ii) the difference between
a SAR's Exercise Price and the then Fair Market Value of the Stock times the
number of shares covered by the unexercised vested portion of such Holder's
SARs; and (iii) a Phantom Share's Fair Market Value times the number of shares
covered by the unexercised vested portion of such Holder's Phantom Shares; and
(iv) the Fair Market Value of a share of Restricted Stock times the number of
shares of Restricted Stock, as applicable.
6.4 FORFEITURE AND RESTRICTIONS ON TRANSFER. Each Agreement may
contain or otherwise provide for conditions giving rise to the forfeiture of the
Stock acquired pursuant to an Award or otherwise and may also provide for those
restrictions on the transferability of shares of the Stock acquired pursuant to
an Award or otherwise that the Committee in its sole and absolute discretion may
deem proper or advisable. The conditions giving rise to forfeiture may include,
but need not be limited to, the requirement that the Holder render substantial
services to the Corporation or its Affiliates for a specified period of time.
The restrictions on transferability may include, but need not be limited to,
options and rights of first refusal in favor of the Corporation and shareholders
of the Corporation other than the Holder of such shares of Stock who is a party
to the particular Agreement or a subsequent holder of the shares of Stock who is
bound by that Agreement.
Notwithstanding any Plan provision to the contrary, only Holders who meet
the minimum Stock ownership guidelines established by the Committee may sell or
transfer the Stock they acquire pursuant to an Award; however, this ownership
requirement shall not apply to sales of Stock to fund the exercise of an Award
or the payment of any taxes caused by such exercise. The minimum ownership
level is set forth on Appendix A. This level may be changed by the Committee in
its sole discretion at any time. The Fair Market Value of all Stock holdings
(whether vested or forfeitable) will be considered toward meeting the required
ownership level. In addition, a Holder will be treated as owning (a) the Fair
Market Value of Stock equal to his account balance in the ClubCorp Stock
Investment Plan as of the Plan's most recent allocation date; (b) an amount
equal to the difference between the Exercise Price of any Stock Appreciation
Right held by Holder over the Fair Market Value of the Stock subject to the
Stock Appreciation Rights on such date; (c) an amount equal to the Fair Market
Value of Stock subject to a Phantom Share; and (d) an amount equal to the number
of shares of Restricted Stock held by Holder. Notwithstanding the preceding, no
Holder may sell or transfer Stock acquired pursuant to an Award prior to the
date that is six (6) months from their receipt of the Stock under such Award.
In addition, all Stock issued pursuant to the exercise of an Award under
this Plan shall be subject to the terms and conditions of the shareholders
agreement that the Corporation shall forward to each Holder upon the exercise of
an Award. Notwithstanding anything to the contrary in the Plan or the Holder's
Agreement, the Holder shall have no right to have any shares issued to him or
her until the Holder has signed the shareholders agreement given to him by the
Corporation. Each Agreement may contain or otherwise provide for such other
restrictions on the transferability of Stock acquired pursuant to an Award as
the Committee, in its sole and absolute discretion, shall deem proper or
advisable. Such other restrictions on transferability may include, but need not
be limited to, options and rights of first refusal in favor of the Corporation
and shareholders of the Corporation.
6.5 CONDITIONS TO DELIVERY OF STOCK. Nothing herein or in any Award
granted hereunder or any Agreement shall require the Corporation to issue any
shares with respect to any Award if that issuance would, in the opinion of
counsel for the Corporation, constitute a violation of the Securities Act or any
similar or superseding statute or statutes, any other applicable statute or
regulation, or the rules of any applicable securities exchange or securities
association, as then in effect. At the time of any exercise of an Option, Stock
Appreciation Right, a Phantom Share, or issuance of any Restricted Stock the
Corporation may, as a condition precedent to the exercise of such Option, Stock
Appreciation Right, Phantom Share, or issuance of Restricted Stock require from
the Holder of the Award (or in the event of his death, his legal
representatives, heirs, legatees, or distributees) such written representations,
if any, concerning the Holder's (or Holder's transferee's) intentions with
regard to the retention or disposition of the shares of Stock being acquired
pursuant to the Award and such written covenants and agreements, if any, as to
the manner of disposal of such shares as, in the opinion of counsel to the
Corporation, may be necessary to ensure that any disposition by that Holder (or
in the event of the Holder's death, his legal representatives, heirs, legatees,
or distributees) will not involve a violation of the Securities Act or any
similar or superseding statute or statutes, any other applicable state or
federal statute or regulation, or any rule of any applicable securities exchange
or securities association, as then in effect.
6.6 PAYMENT WITH SALE PROCEEDS. If the Stock has been registered under
the Act, then at the request of the Holder (or his transferee) and to the extent
permitted by applicable law, the Committee may (but shall not be required to)
approve arrangements with a brokerage firm under which that brokerage firm, on
behalf of the Holder (or his transferee), shall pay to the Corporation the
Exercise Price of the Award being exercised and the Corporation shall promptly
deliver the exercised shares of Stock to the brokerage firm. To accomplish this
transaction, the Holder (or his transferee) must deliver to the Corporation an
Exercise Notice containing irrevocable instructions from the Holder (or his
transferee) to the Corporation to deliver the Stock certificates representing
the shares of Stock directly to the broker. Upon receiving a copy of the
Exercise Notice acknowledged by the Corporation, the broker shall sell that
number of shares of Stock or loan the Holder (or his transferee) an amount
sufficient to pay the Exercise Price and any withholding obligations due. The
broker then shall deliver to the Corporation that portion of the sale or loan
proceeds necessary to cover the Exercise Price and any withholding obligations
due. The Committee shall not approve any transaction of this nature if the
Committee believes that the transaction would give rise to the Holder's
liability for short-swing profits under Section 16(b) of the Act.
6.7 CERTAIN DIRECTORS AND OFFICERS. With respect to Holders who are
directors or officers of the Corporation or any of its Affiliates and who are
subject to Section 16(b) of the Act, Awards and all rights under the Plan shall
be exercisable during the Holder's lifetime only by the Holder or the Holder's
guardian or legal representative, but not for at least six (6) months after the
Date of grant, unless (a) the Board of Directors expressly authorizes that an
Award shall be exercisable before the expiration of the six (6) month period or
(b) the death or Disability of the Holder occurs before the expiration of the
six (6) month period. In addition, no such officer or director shall exercise
any Stock Appreciation Right, Phantom Share or have shares of Stock withheld to
pay tax withholding obligations within the first six (6) months of the term of
an Award. Any election by any such officer or director to have tax withholding
obligations satisfied by the withholding of shares of Stock shall be irrevocable
and shall be communicated to the Committee during the period beginning on the
third day following the date of release of quarterly or annual summary
statements of sales and earnings and ending on the twelfth business day
following such date (the "Window Period") or by an irrevocable election
communicated to the Committee at least six (6) months before the date of
exercise of the Award for which such withholding is desired. Any election by
such an officer or director to receive cash in full or partial settlement of a
Stock Appreciation Right, or Phantom Share as well as any exercise by such
individual of a Stock Appreciation Right or Phantom Share for such cash, in
either case to the extent permitted under the applicable Agreement or otherwise
permitted by the Committee, shall be made during the Window Period or within any
other periods that the Committee shall specify from time to time.
6.8 RIGHTS AS A SHAREHOLDER. A Holder (or his transferee) shall have
no right as a shareholder with respect to any shares covered by his Award until
a certificate representing those shares is issued in his name. No adjustment
shall be made for Dividends (ordinary or extraordinary, whether in cash or other
property) or distributions or other rights unless otherwise provided in his
Agreement. Nevertheless, Dividends, dividend equivalent rights and voting
rights may be extended to and made part of any Award denominated in Stock or
units of Stock, subject to such terms, conditions and restrictions as the
Committee may establish. The Committee may also establish rules and procedures
for the crediting of interest on deferred cash payments and dividend equivalents
for deferred payment denominated in Stock or units of Stock.
6.9 FURNISH INFORMATION. Each Holder (or his transferee) shall furnish
to the Corporation all information requested by the Corporation to enable it to
comply with any reporting or other requirement imposed upon the Corporation by
or under any applicable statute or regulation.
6.10 OBLIGATION TO EXERCISE. The granting of an Award hereunder shall
impose no obligation to exercise the same or any part thereof.
6.11 ADJUSTMENTS TO AWARDS. Subject to Section 16(b), Code Section
162(m) and the limitations set forth in this Plan, the Committee may make any
adjustment in the Exercise Price of, the number of shares of Stock subject to,
or the terms of, an Award, or by canceling the outstanding Award and regranting
such Award. Such adjustment shall be made by amending, substituting, or
regranting the Award. Such amendment, substitution, or regrant may result in
terms and conditions that differ from the terms and conditions of the original
Award. The Committee may not, however, impair the rights of any Holder (or his
transferee) of previously granted Awards without that Holder's (or his
transferee's) consent. If such action is effected by amendment, such amendment
shall be deemed effective as of the Date of grant of the amended Award.
6.12 REMEDIES. The Corporation shall be entitled to recover from a
Holder (or his transferee) reasonable attorneys' fees incurred in connection
with the enforcement of the terms and provisions of the Plan and any Agreement
whether by an action to enforce specific performance or for damages for its
breach or otherwise.
6.13 INFORMATION CONFIDENTIAL. As partial consideration for the
granting of each Award hereunder, the Holder shall agree with the Corporation
that he will keep confidential all information and knowledge that he has
relating to the manner and amount of his participation in the Plan; provided,
however, that such information may be disclosed as required by law and may be
given in confidence to the Holder's spouse, tax or financial advisors, or to a
financial institution to the extent that such information is necessary to secure
a loan. In the event any breach of this promise comes to the attention of the
Committee, it shall take into consideration that breach in determining whether
to recommend the grant of any future Award to that Holder, as a factor
mitigating against the advisability of granting any such future Award to such
individual.
6.14 CONSIDERATION. No Award shall be exercisable with respect to a
Holder (or his transferee) unless he shall have paid cash or property to, or
performed services for, the Corporation or any of its Affiliates that the
Committee believes is equal to or greater in value than the par value of the
Stock subject to such Award.
SECTION 7. DURATION AND AMENDMENT OF PLAN
7.1 DURATION. No Awards may be granted hereunder after the date that
is ten (10) years from the date the Plan is adopted by the Board of Directors.
7.2 AMENDMENT. The Board of Directors may, insofar as permitted by
law, with respect to any shares which, at the time, are not subject to Awards,
suspend or discontinue the Plan or revise or amend it in any respect whatsoever
and may amend any provision of the Plan or any Agreement to make the Plan or the
Agreement, or both, comply with Section 16(b) of the Act and the exemptions from
that Section in the regulations thereunder. The Board of Directors may also
amend, modify, suspend, or terminate the Plan for the purpose of meeting or
addressing any changes in other legal requirements applicable to the Corporation
or the Plan or for any other purpose permitted by law. In connection with any
amendment of the Plan, the Board of Directors shall be authorized to incorporate
such provisions as shall be necessary for amounts paid under the Plan to be
exempt from Section 162(m) of the Code.
SECTION 8. GENERAL
8.1 APPLICATION OF FUNDS. The proceeds received by the Corporation
from the sale of shares pursuant to Awards may be used for any general corporate
purpose.
8.2 RIGHT OF THE CORPORATION AND AFFILIATES TO TERMINATE EMPLOYMENT.
Nothing contained in the Plan, or in any Agreement, shall confer upon any Holder
the right to continue in the employ of the Corporation or any Affiliate or
interfere in any way with the rights of the Corporation or any Affiliate to
terminate the Holder's employment at any time.
8.3 NO LIABILITY FOR GOOD FAITH DETERMINATIONS. Neither the members of
the Board of Directors nor any member of the Committee shall be liable for any
act, omission or determination taken or made in good faith with respect to the
Plan or any Award granted under it; and members of the Board of Directors and
the Committee shall be entitled to indemnification and reimbursement by the
Corporation in respect of any claim, loss, damage, or expense (including
attorneys' fees, the costs of settling any suit, provided such settlement is
approved by independent legal counsel selected by the Corporation, and amounts
paid in satisfaction of a judgment, except a judgment based on a finding of bad
faith) arising therefrom to the full extent permitted by law and under any
directors' and officers' liability or similar insurance coverage that may from
time to time be in effect. This right to indemnification shall be in addition
to, and not a limitation on, any other indemnification rights any member of the
Board of Directors or the Committee may have.
8.4 OTHER BENEFITS. Participation in the Plan shall not preclude the
Holder from eligibility in any other stock plan or stock option plan of the
Corporation or any Affiliate or any old age benefit, insurance, pension, profit
sharing retirement, bonus, or other extra compensation plans that the
Corporation or any Affiliate has adopted, or may, at any time, adopt for the
benefit of its employees. Neither the adoption of the Plan by the Board of
Directors nor the submission of the Plan to the shareholders of the Corporation
for approval shall be construed as creating any limitations on the power of the
Board of Directors to adopt such other incentive arrangements as it may deem
desirable, including, without limitation, the granting of stock options and the
awarding of stock and cash otherwise than under the Plan and such arrangements
may be either generally applicable or applicable only in specific cases.
8.5 EXCLUSION FROM PENSION AND PROFIT-SHARING COMPENSATION. By
acceptance of an Award (regardless of form) each Holder shall be deemed to have
agreed that the Award is special incentive compensation that will not be taken
into account in any manner as salary, compensation, or bonus in determining the
amount of any payment under any pension, retirement, or other employee benefit
plan of the Corporation or any Affiliate, unless any pension, retirement, or
other employee benefit plan of the Corporation or Affiliate expressly provides
that such Award shall be so considered for purposes of determining the amount of
any payment under any such plan. In addition, each beneficiary of a deceased
Holder shall be deemed to have agreed that the Award will not affect the amount
of any life insurance coverage, if any, provided by the Corporation or a
Affiliate on the life of the Holder that is payable to the beneficiary under any
life insurance plan covering employees of the Corporation or any Affiliate.
8.6 AGREEMENT REQUIREMENTS. No Award shall be deemed granted unless
the key employee or Eligible Individual has signed an Agreement, that is in a
form satisfactory to the Corporation. In the event a Holder is determined to
have violated the terms of his or her Agreement by a court of competent
jurisdiction or pursuant to arbitration, all Awards under this Plan, including
vested Awards, will be forfeited as of the date of the violation. In addition,
any Stock acquired through the exercise of an Award must be returned to the
Corporation. In the case of an Option, the Corporation shall refund to Holder
the Exercise Price of such forfeited Stock. If Holder no longer owns the Stock,
Holder will owe the Corporation an amount equal to any gain or profit over the
Exercise Price that the Holder received on the sale of such Stock and the
Corporation has the right to offset this amount from any payments it owes
Holder.
8.7 BENEFICIARY DESIGNATION. Each Holder shall have the right to
designate a beneficiary on the form provided by the Committee. If no
beneficiary is designated, Holder's estate shall have the right of a
beneficiary. If Holder was an Optionee under the Club Corporation International
Executive Stock Option Plan, any beneficiary designation under that Plan will be
effective for purposes of this Plan, unless or until otherwise revoked.
8.8 EXECUTION OF RECEIPTS AND RELEASES. Any payment of cash or any
issuance or transfer of shares of Stock to the Holder, or to his legal
representative, heir, legatee, or distributee, in accordance with the provisions
hereof, shall, to the extent thereof, be in full satisfaction of all claims of
such individuals hereunder. The Committee may require any Holder, legal
representative, heir, legatee, or distributee, as a condition precedent to such
payment, to execute a release and receipt therefor in such form as it shall
determine.
8.9 UNFUNDED PLAN. Insofar as it provides for Awards of cash and
Stock, the Plan shall be unfunded. Although bookkeeping accounts may be
established with respect to Holders who are entitled to cash, Stock, or rights
thereto under the Plan, any such accounts shall be used merely as a bookkeeping
convenience. The Corporation shall not be required to segregate any assets that
may at any time be represented by cash, Stock, or rights thereto, nor shall the
Plan be construed as providing for such segregation, nor shall the Corporation,
the Board of Directors nor the Committee be deemed to be a trustee of any cash,
Stock, or rights thereto to be granted under the Plan. Any liability of the
Corporation to any Holder (or his transferee) with respect to a grant of cash,
Stock, or rights thereto under the Plan shall be based solely upon any
contractual obligations that may be created by the Plan and any Agreement; no
such obligation of the Corporation shall be deemed to be secured by any pledge
or other encumbrance on any property of the Corporation. Neither the
Corporation, the Board of Directors nor the Committee shall be required to give
any security or bond for the performance of any obligation that may be created
by the Plan.
8.10 NO GUARANTEE OF INTERESTS. Neither the Committee nor the
Corporation guarantees the Stock from loss or depreciation.
8.11 PAYMENT OF EXPENSES. All expenses incident to the administration,
termination, or protection of the Plan, including, but not limited to, legal and
accounting fees, shall be paid by the Corporation or its Affiliates; provided,
however, the Corporation or an Affiliate may recover any and all damages, fees,
expenses, and costs arising out of any actions taken by the Corporation to
enforce its right to purchase Stock under this Plan.
8.12 CORPORATION RECORDS. Records of the Corporation or its Affiliates
regarding the Holder's period of employment, Termination and the reason
therefor, leaves of absence, re-employment, and other matters shall be
conclusive for all purposes hereunder, unless determined by the Committee to be
incorrect.
8.13 INFORMATION. The Corporation and its Affiliates shall, upon
request or as may be specifically required hereunder, furnish or cause to be
furnished all of the information or documentation which is necessary or required
by the Committee to perform its duties and functions under the Plan.
8.14 NO LIABILITY OF CORPORATION. The Corporation assumes no
obligation or responsibility to the Holder or his legal representatives, heirs,
legatees, or distributees for any act of, or failure to act on the part of, the
Committee.
8.15 CORPORATION ACTION. Any action required of the Corporation shall
be by resolution of its Board of Directors or by an individual authorized to act
for the Corporation.
8.16 ARBITRATION. Any legal or equitable claims or disputes arising
out of or in connection with this Plan or any Agreement, shall be resolved by
binding arbitration. The arbitration proceedings shall be conducted in Dallas,
Texas in accordance with the Employment Dispute Resolution Rules ("EDR RULES")
of the American Arbitration Association ("AAA") in effect at the time a demand
for arbitration is made. Holder is entitled to representation by an attorney
throughout the proceedings at his own expense; however, the Corporation agrees
not to use an attorney in the arbitration hearing if the Holder agrees to the
same.
One arbitrator shall be used and shall be chosen by mutual agreement of the
parties. If, within thirty (30) days no arbitrator has been chosen, an
arbitrator shall be chosen from a list or lists of proposed arbitrators
submitted by the AAA pursuant to its EDR Rules, except that (i) the number of
preemptory strikes shall not be limited, and (ii) if the parties fail to select
an arbitrator from one or more lists, within sixty (60) days after the Holder
notifies the Corporation of an arbitrable dispute, AAA shall have the power to
appoint the arbitrator. The arbitrator shall coordinate, and limit as
appropriate, all pre-arbitral discovery, which shall include document
production, information requests, and depositions. The arbitrator shall issue a
written decision and award stating the reasons therefor. The decision and award
shall be final and binding on both parties, their heirs, executors,
administrators, successors, and assigns. The costs and expenses of the
arbitration shall be borne evenly by the parties.
8.17 SEVERABILITY. In the event that any provision of this Plan, or
the application hereof to any individual or circumstance, is held by a court of
competent jurisdiction to be invalid, illegal, or unenforceable in any respect
under present or future laws effective during the effective term of any such
provision, such invalid, illegal, or unenforceable provision shall be fully
severable; and this Plan shall then be construed and enforced as if such
invalid, illegal, or unenforceable provision had not been contained in this
Plan; and the remaining provisions of this Plan shall remain in full force and
effect and shall not be affected by the illegal, invalid, or unenforceable
provision or by its severance from this Plan. Furthermore, in lieu of each such
illegal, invalid, or unenforceable provision, there shall be added automatically
as part of this Plan a provision as similar in terms to such illegal, invalid,
or unenforceable provision as may be possible and be legal, valid, and
enforceable. If any of the terms or provisions of this Plan conflict with the
requirements of Rule 16b-3 (as those terms or provisions are applied to Eligible
Individuals who are subject to Section 16(b) of the Act), then those conflicting
terms or provisions shall be deemed inoperative to the extent they so conflict
with the requirements of Rule 16b-3 and, in lieu of such conflicting provision,
there shall be added automatically as part of this Plan a provision as similar
in terms to such conflicting provision as may be possible and not conflict with
the requirements of Rule 16b-3.
8.18 NOTICES. Whenever any notice is required or permitted hereunder,
such notice must be in writing and personally delivered or sent by mail. Any
notice required or permitted to be delivered hereunder shall be deemed to be
delivered on the date on which it is actually received by the Corporation
addressed to the attention of the Corporate Secretary at the Corporation's
office as specified in the applicable Agreement. The Corporation or a Holder
(or his transferee) may change, at any time and from time to time, by written
notice to the other, the address which it or he had previously specified for
receiving notices. Until changed in accordance herewith, the Corporation and
each Holder shall specify as its and his address for receiving notices the
address set forth in the Agreement pertaining to the shares to which such notice
relates. Any person entitled to notice hereunder may waive such notice.
8.19 SUCCESSORS. The Plan shall be binding upon the Holder, his legal
representatives, heirs, legatees, and distributees, upon the Corporation, its
successors and assigns and upon the Committee and its successors.
8.20 HEADINGS. The titles and headings of Sections and Subsections are
included for convenience of reference only and are not to be considered in
construction of the provisions hereof.
8.21 GOVERNING LAW. All questions arising with respect to the
provisions of the Plan shall be determined by application of the laws of the
State of Texas, without giving effect to any conflict of law provisions thereof,
except to the extent Texas law is preempted by federal law. The obligation of
the Corporation to sell and deliver Stock hereunder is subject to applicable
federal, state and foreign laws and to the approval of any governmental
authority required in connection with the authorization, issuance, sale, or
delivery of such Stock.
8.22 WORD USAGE. Words used in the masculine shall apply to the
feminine where applicable, and wherever the context of this Plan dictates, the
plural shall be read as the singular and the singular as the plural.
SECTION 9. EFFECTIVE DATE.
The Plan shall be effective on February 10, 1998.
IN WITNESS WHEREOF, Club Corporation International, acting by and through
its duly authorized officer, has executed this Plan document on this the 17th
day of June, 1998.
CLUB CORPORATION INTERNATIONAL
a Nevada corporation
By: /s/Terry A. Taylor
Title: Chief Legal Officer and
Senior Vice President
APPENDIX A
MINUMUM OWNERSHIP LEVELS
<TABLE>
<CAPTION>
<S> <C>
Salary Level Salary Multiple
- -------------- ---------------
Levels 14 & 15 10X
Levels 12 &13 7X
Level 11 5X
Level 10 3X
Level 9 1.5X
</TABLE>
Exhibit 5.1
Hughes & Luce, L.L.P.
[Letterhead]
June 18, 1998
Club Corporation International
3030 LBJ Freeway, Suite 700
Dallas, Texas 75234
Ladies and Gentlemen:
We have acted as special counsel to Club Corporation International, a
Nevada corporation (the "Company"), in connection with the registration under
the Securities Act of 1933, as amended (the "Act"), of 4,000,000 shares of the
Company's common stock, par value $.01 per share (the "Common Stock"), issuable
upon the exercise of stock options to be granted pursuant to the Club
Corporation International Omnibus Stock Plan (the "Plan"), as described in the
Registration Statement of the Company on Form S-8 (the "Registration Statement")
filed with the Securities and Exchange Commission.
In rendering this opinion, we have examined and relied upon executed
originals, counterparts or copies of such documents, records and certificates
(including certificates of public officials and officers of the Company) as we
considered necessary or appropriate for enabling us to express the opinions set
forth herein. In all such examinations, we have assumed the authenticity and
completeness of all documents submitted to us as originals and the conformity to
originals and completeness of all documents submitted to us as photostatic,
conformed, notarized or certified copies.
Based on the foregoing, we are of the opinion that such shares of Common
Stock have been duly authorized and, if and when issued and paid for in full in
accordance with the Plan as contemplated by the Registration Statement, will be
validly issued, fully paid, and nonassessable.
Very truly yours,
Hughes & Luce, L.L.P.
EXHIBIT 15.1
Club Corporation International
Dallas, Texas
Ladies and Gentlemen:
Re: Registration Statement Filed on Form S-8 Regarding the Club Corporation
International Omnibus Stock Plan
With respect to the subject registration statement, we acknowledge our awareness
of the use therein of our report dated May 1, 1998, related to our review of
interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such report is not
considered part of a registration statement prepared or certified by an
accountant or a report prepared or certified by an accountant within the meaning
of sections 7 and 11 of the Act.
KPMG Peat Marwick LLP
Dallas, Texas
June 18, 1998
Exhibit 23.2
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Club Corporation International:
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of Club Corporation International of our report dated February 27,
1998, relating to the consolidated balance sheets of Club Corporation
International and subsidiaries as of December 31, 1997 and 1996, and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the years in the three-year period ended December 31, 1997 and the
related schedules, which report appears in the December 31, 1997 Annual Report
on Form 10-K of Club Corporation International. Our report on the consolidated
financial statements refers to a change in 1995 in the method of accounting for
impairment of long-lived assets.
KPMG Peat Marwick LLP
Dallas, Texas
June 18, 1998
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears
below constitutes and appoints James P. McCoy, Jr. and Charles A. Little, 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 the Registration Statement on Form S-8 relating
to the Club Corporation International Omnibus Stock Plan and any and all
amendments (including post-effective amendments) to such 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, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or either of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Power of
Attorney has been signed by the following persons in the capacities and on the
dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
- ------------------------ ------------------------------------ --------------
<S> <C> <C>
/s/Robert H. Dedman, Sr. Chairman of the Board and April 14, 1998
- ------------------------ Co-Chief Executive Officer
Robert H. Dedman, Sr. (Principal Executive Officer)
/s/James E. Maser Vice Chairman of the Board April 14, 1998
- ------------------------
James E. Maser
/s/Robert H. Dedman, Jr. President, Co-Chief Executive April 14, 1998
- ------------------------ Officer and Director
Robert H. Dedman, Jr.
/s/James M. Hinckley Chief Operating Officer of Domestic April 14, 1998
- ------------------------ Operations and Director
James M. Hinckley
/s/Robert H. Johnson Chief Operating Officer of April 14, 1998
- ------------------------ International Operations and
Robert H. Johnson Director
/s/James P. McCoy, Jr. Executive Vice President, Chief April 14, 1998
- ------------------------ Financial Officer and Director
James P. McCoy, Jr. (Principal Financial Officer and
Accounting Officer)
/s/Mark W. Dietz Executive Vice President and April 14, 1998
- ------------------------ Director
Mark W. Dietz
/s/Richard S. Poole Executive Vice President and April 14, 1998
- ------------------------ Director
Richard S. Poole
/s/Albert E. Chew, III Executive Vice President and April 14, 1998
- ------------------------ Director
Albert E. Chew, III
/s/Terry A. Taylor Senior Vice President, Secretary, April 14, 1998
- ------------------------ Chief Legal Officer and Director
Terry A. Taylor
____________________ Director
Nancy M. Dedman
/s/Patricia Dedman Dietz Director April 14, 1998
- ------------------------
Patricia Dedman Dietz
/s/Jerry W. Dickenson Director April 14, 1998
- ------------------------
Jerry W. Dickenson
</TABLE>
