As filed with the Securities and Exchange Commission on August 6, 1997
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
THE SPORTS AUTHORITY, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-3511120
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3383 N. State Road 7
Ft. Lauderdale, Florida 33319
(Address of principal executive offices) (Zip Code)
THE SPORTS AUTHORITY, INC.
AMENDED AND RESTATED DIRECTOR STOCK PLAN
(Full title of the plan)
FRANK W. BUBB, III
Vice President, General Counsel and Secretary
The Sports Authority, Inc.
3383 North State Road 7
Ft. Lauderdale, Florida 33319
(Name and address of agent for service)
(954) 735-1701
(Telephone number, including area code, of agent for service)
COPY OF ALL COMMUNICATIONS TO:
ROBERT J. LICHTENSTEIN
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103-6993
(215) 963-5000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Title of securities Amount to be Proposed maximum Proposed maximum Amount of
to be registered registered offering price aggregate registration fee
per share (1) offering price (1)
====================================================================================================================================
<S> <C> <C> <C> <C>
Common Stock, $.01 par 70,317 $18.03125 $1,267,903.40 $380.41
value
====================================================================================================================================
</TABLE>
(1) Estimated pursuant to paragraphs (c) and (h) of Rule 457 solely for the
purpose of calculating the registration fee, based upon the average of
the high and low sales prices of shares of Common Stock on July 31,
1997 as reported on the New York Stock Exchange.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by The Sports Authority,
Inc. (the "Company") with the Securities and Exchange Commission (the
"Commission"), are incorporated by reference in this Registration Statement:
(a) Annual Report on Form 10-K, for the fiscal year
ended January 26, 1997; and
(b) The description of the shares of Common Stock,
$.01 par value, of the Company (the "Common
Stock") contained in the S-1 Prospectus under
"Description of Capital Stock", which is also
incorporated by reference in the Company's
Registration Statement on Form 8-A, dated October
24, 1994, which was filed with the Commission
pursuant to Section 12(b) of the Securities
Exchange Act of 1934, as amended and the Rules
promulgated tehreunder (the "Exchange Act").
All reports and other documents subsequently filed by the
Company with the Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Exchange Act after the date of this Registration Statement, but prior to the
filing of a post-effective amendment to this Registration Statement which
indicates that all securities offered by this Registration Statement have been
sold or which deregisters all such securities then remaining unsold, shall be
deemed to be incorporated by reference into this Registration Statement. Each
document incorporated by reference into this Registration Statement shall be
deemed to be a part of this Registration Statement, from the date of the filing
of such document with the Commission until the information contained therein is
superseded or updated by any subsequently filed document which is incorporated
by reference into the Registration Statement.
Any statement contained in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes
hereof to the extent that a statement contained herein (or in any other
subsequently filed document that is also incorporated by reference herein)
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part hereof.
ITEM 4. DESCRIPTION OF SECURITIES.
The class of securities to be offered under this
Registration Statement is registered under Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The financial statements of the Company as of January 26,
1997 and for the years ended January 28, 1996 and January 22, 1995 incorporated
in this Registration Statement by reference to the Annual Report on Form 10-K of
the Company for the year ended January 26, 1997 have been audited by Price
Waterhouse, LLP ("Price Waterhouse"), independent auditors, as set forth in
their report contained therein. Such financial statements are, and audited
annual financial statements to be included in subsequently filed documents will
be, so incorporated in reliance on the report of Price Waterhouse pertaining to
such financial statements (to the extent covered by consents filed with the
Commission), given on the authority of said firm as experts in auditing and
accounting.
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<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Seventh of the Company's Amended and Restated
Certificate of Incorporation provides that the Company shall indemnify to the
fullest extent permitted by the Delaware General Corporation Law (the "DGCL")
any director or officer who is or was a party to any civil, criminal,
administrative or investigative suit or proceeding by reason of the fact that he
or she is or was a director or officer of the Company or is or was serving
another corporation, partnership, joint venture, trust or other enterprise at
the request of the Company including service with respect to employee benefit
plans; provided that the Company shall indemnify any person seeking indemnity in
connection with an action (or part thereof) initiated by such person only if the
action (or part thereof) initiated by such person only if the action (or part
thereof) was authorized by the Board of Directors. In addition, the Company may,
by action by the Board of Directors, provide indemnification to employees and
agents with the same scope and effect as the foregoing indemnification of
directors and officers.
Under Section 145 of the DGCL, a corporation may indemnify
a director, officer, employee or agent of the corporation (or other entity if
such person is serving in such capacity at the corporation's request) against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him if he acted in good faith and
in a manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. In the
case of an action brought by or in the right of a corporation, the corporation
may indemnify a director, officer, employee or agent of the corporation (or
other entity if such person is serving in such capacity at the corporation's
request) against expenses (including attorneys' fees) actually and reasonably
incurred by him if he acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interests of the corporation, except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless a court determines that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnification for such expenses as the court shall deem proper.
Expenses (including attorneys' fees) incurred by an officer or director in
defending any civil, criminal, administrative or investigative action, suit or
proceeding may be paid by the corporation in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on behalf
of such director or officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the corporation.
Policies of insurance will be maintained by the Company
under which directors and officers of the Company will be insured, within the
limits and subject to the limitations of the policies, against certain expenses
in connection with the defense of actions, suits or proceedings, and certain
liabilities which might be imposed as a result of such actions, suits or
proceedings, to which they are parties by reason of being or having been a
director or officer.
The Company's Amended and Restated Certificate of
Incorporation provides that, to the fullest extent permitted by the DGCL, no
director shall be personally liable to the Company or its stockholders for
monetary damages for breach of fiduciary duty as a director, except for
liability (i) for any breach of the director's duty of loyalty to the Company or
its stockholders, (ii) for acts or omissions not in good faith or that involve
intentional misconduct or a knowing violation of law, (iii) pursuant to Section
174 of the DGCL or (iv) for any transaction from which the director derived any
improper personal benefit.
Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers or persons
controlling the Company pursuant to the foregoing provisions, the Company has
been informed that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
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<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following exhibits are filed herewith or incorporated
by reference as part of this Registration Statement:
EXHIBIT NO. DESCRIPTION
- ----------- -----------
4 The Sports Authority, Inc. Amended and Restated Director
Stock Plan.
5 Opinion of Morgan, Lewis & Bockius LLP as to the legality of
the shares being registered.
23.1 Consent of Price Waterhouse LLP, independent accountants.
23.2 Consent of Morgan, Lewis & Bockius LLP (included in
Exhibit 5).
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required
by Section 10(a)(3) of the Securities Act of 1933.
(ii) To reflect in the prospectus any
facts or events arising after the effective date of this
Registration Statement (or the most recent post-effective
amendment to the Registration Statement) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
(iii) To include any material information
with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered
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<PAGE>
herein, 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 Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling persons 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.
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<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 Ft. Lauderdale, State of Florida, on this 30th
day of July, 1997.
THE SPORTS AUTHORITY, INC.
By: /s/ JACK A. SMITH
-----------------------
Jack A. Smith
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement and the foregoing Power of Attorney have been
signed by the following persons in the capacities and on the date(s) indicated:
<TABLE>
<CAPTION>
SIGNATURE CAPACITY DATE
- --------- -------- ----
<S> <C> <C>
/s/ JACK A. SMITH Chairman of the Board, Chief July 30, 1997
- --------------------------- Executive Officer and Director
(Principal Executive Officer) (Principal Executive Officer)
Jack A. Smith
/s/ ANTHONY F. CRUDELE Senior Vice President and Chief July 30, 1997
- --------------------------- Financial Officer (Principal Financial
Anthony F. Crudele and Accounting Officer)
/s/ RICHARD J. LYNCH, JR. President, Chief Operating Officer and July 30, 1997
- --------------------------- Director
Richard J. Lynch, Jr.
/s/ NICHOLAS A. BUONICONTI Director July 30, 1997
- ---------------------------
Nicholas A. Buoniconti
/s/ STEVE DOUGHERTY Director July 30, 1997
- ---------------------------
Steve Dougherty
___________________________ Director
Julius Erving
/s/ CAROL A. FARMER Director July 30, 1997
- ---------------------------
Carol A. Farmer
___________________________ Director
Jack F. Kemp
/s/ W. MITT ROMNEY Director July 30, 1997
- ---------------------------
W. Mitt Romney
/s/ HAROLD TOPPEL Director July 30, 1997
- ---------------------------
Harold Toppel
</TABLE>
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<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ----------- -----------
4 The Sports Authority, Inc. Amended and Restated Director
Stock Plan.
5 Opinion of Morgan, Lewis & Bockius LLP as to the legality
of the shares being registered.
23.1 Consent of Price Waterhouse LLP, independent accounts.
23.2 Consent of Morgan, Lewis & Bockius LLP (included in
Exhibit 5).
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EXHIBIT 4
THE SPORTS AUTHORITY, INC.
AMENDED AND RESTATED DIRECTOR STOCK PLAN
1. PURPOSE.
1.1 The Sports Authority, Inc. Director Stock Plan is intended to
increase the proprietary interest of non-employee members of the Board of
Directors of The Sports Authority, Inc. by providing further opportunity for
ownership of the Company's common shares. By means of such increased proprietary
interest, the Plan is intended to increase their incentive to contribute to the
success of the Company's business.
1.2 The Plan is intended to comply with Rule 16b-3 under the Securities
Exchange Act of 1934, as amended, as such Rule may be amended from time to time,
and shall be interpreted in a manner consistent with the requirements thereof,
as now or hereafter construed, interpreted and applied by regulations, rulings
and cases. The amendment and restatement of the Plan shall be effective as of
May 29, 1997.
2. DEFINITIONS.
As used in this Plan, the following words and phrases shall
have the meanings indicated:
(a) "Annual Retainer" shall mean the annual retainer fee paid
by the Company to a Participant for his or her services as a director, and shall
not include meeting fees.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Change in Control" shall mean the occurrence of an event
described in Article 11 hereof.
(d) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
(e) "Committee" shall mean the Compensation Committee of the
Board.
(f) "Company" shall mean The Sports Authority, Inc., a
corporation organized under the laws of the State of Delaware, or any successor
corporation.
(g) "Date of Grant" shall mean the date on which an Option is
granted pursuant to Article 10.
(h) "Deferred Shares" means Shares or Restricted Shares that
are deferred at the election of a Participant pursuant to Article 7.
(i) "Disability" shall mean a Participant's total and
permanent inability to perform his or her duties to the Company by reason of any
medically determinable physical or mental impairment, as determined by a
physician selected by the Participant and acceptable to the Company.
(j) "Dividend Equivalents" shall mean amounts credited
pursuant to Article 8.
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<PAGE>
(k) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time, and as now or hereafter construed,
interpreted and applied by regulations, rulings and cases.
(l) "Fair Market Value" per Share shall mean the closing price
on the New York Stock Exchange Composite Transactions Tape (or its equivalent if
the Shares are not traded on the New York Stock Exchange) of a Share on the
trading day immediately prior to the relevant valuation date or Date of Grant.
(m) "Option" shall mean an option to purchase Shares granted
pursuant to Article 10.
(n) "Participant" shall mean a non-employee member of the
Board.
(o) "Plan" shall mean The Sports Authority, Inc. Director
Stock Plan, as amended from time to time.
(p) "Plan Quarter" shall mean a calendar quarter ending on May
31, August 31, November 30 or February 28 (or 29).
(q) "Plan Year" shall mean the approximately 12-month period
beginning on the day after the date of each annual meeting of the Company's
shareholders and ending on the date of the next following annual meeting of the
Company's shareholders. The first Plan Year under the amended and restated Plan
shall begin on May 30, 1997.
(r) "Prior Plan" shall mean the Plan as in effect before the
May 29, 1997 amendment and restatement of the Plan.
(s) "Restricted Period" shall have the meaning given in
Section 6.3(c).
(t) "Restricted Share" shall mean a Share granted subject to
restrictions pursuant to Article 6.
(u) "Rule 16b-3" shall mean Rule 16b-3, as in effect from time
to time, promulgated by the Securities and Exchange Commission under Section 16
of the Exchange Act, including any successor to such Rule.
(v) "Shares" shall mean the common shares of the Company, $.01
par value.
3. SHARES.
The maximum number of Shares which shall be reserved for the grant of
Shares, Restricted Shares and Options under the Plan shall be 150,000 Shares,
which number shall be subject to adjustment as provided in Article 12 hereof.
Such Shares may be either authorized but unissued Shares or Shares that shall
have been or may be reacquired by the Company. If any Restricted Shares under
the Plan are forfeited and reacquired by the Company, or if any Options
terminate or expire unexercised, the Shares forfeited or covered by the
terminated or expired Option shall (unless the Plan shall have been terminated)
again become available for use under the Plan.
4. ELECTION TO RECEIVE ANNUAL RETAINER IN THE FORM OF OPTIONS OR
RESTRICTED SHARES.
4.1 ELECTIONS. Before the beginning of each Plan Year that commences on
or after May 30, 1997, each Participant may elect to receive his or her Annual
Retainer for the Plan Year in the form of Restricted Shares as described in
Article 6 or in the form of Options as described in Article 10. The election
shall be made by filing a written election with the Secretary of the Company
before the beginning of the Plan Year. The election shall be irrevocable as of
the first day of the Plan Year.
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<PAGE>
4.2 1997 PLAN YEAR. The plan year under the Prior Plan that began
January 1, 1997 shall end on May 29, 1997. As of May 29, 1997, each Participant
shall receive a number of unrestricted Shares (except as provided below)
determined by multiplying the number of Restricted Shares held by the
Participant for the year that began January 1, 1997 by a fraction, the numerator
of which shall be the number of days between and including January 1, 1997 and
May 29, 1997 in which the Participant served as a director, and the denominator
of which is 365. The Shares issued may not be sold until December 31, 1997. The
additional Restricted Shares granted for the year that began January 1, 1997
shall be forfeited as of May 29, 1997. Each Participant may make an election
under Section 4.1 with respect to the Annual Retainer to be earned during the
Plan Year beginning May 30, 1997.
4.3 ELECTIONS FOR NEW PARTICIPANTS. If an individual becomes a
Participant during a Plan Year, the Participant may elect to receive his or her
Annual Retainer for the Plan Year in the form of Restricted Shares or Options,
by filing a written election with the Secretary of the Company before the
individual becomes a Participant. The election shall be irrevocable as of the
date on which the individual becomes a Participant.
4.4 FAILURE TO MAKE AN ELECTION. If a Participant makes no election
under this Article 4 for a Plan Year, the Participant's Annual Retainer shall be
paid in the form of Restricted Shares.
5. GRANTS OF SHARES FOR MEETING FEES.
5.1 GRANTS SUBJECT TO DEFERRAL ELECTION, IF ANY. The provisions of this
Article 5 with respect to grants of Shares shall be subject to any deferral
election made with respect to such Shares by a Participant in accordance with
Article 7.
5.2 MEETING FEES. The meeting fees of each Participant shall be
provided in the form of a grant of Shares made on the last business day of the
Plan Quarter in which the relevant meetings occur. Shares so granted shall have
a Fair Market Value on such date equal to the aggregate amount of the meeting
fees for the Participant with respect to meetings occurring in such Plan
Quarter. Such Shares shall not be sold until at least six months after their
date of grant. Fractional Shares shall be paid in cash.
6. GRANT OF RESTRICTED SHARES FOR ANNUAL RETAINER.
6.1 GRANTS SUBJECT TO DEFERRAL ELECTION, IF ANY. All provisions of this
Article 6 with respect to grants of Restricted Shares shall be subject to any
deferral election made with respect to such Restricted Shares by a Participant
in accordance with Article 7.
6.2 GRANTS OF RESTRICTED SHARES FOR ANNUAL RETAINER. Each individual
who is a Participant at the beginning of a Plan Year and who is to receive
Restricted Shares for the Plan Year pursuant to Article 4 shall receive his or
her Annual Retainer in the form of a grant of Restricted Shares made on the
first business day of the Plan Year. The Restricted Shares so granted shall have
a Fair Market Value on such date equal to the amount of the Annual Retainer in
effect on such date for the Participant. Fractional Shares shall be paid in
cash.
In the case of an individual who becomes a Participant during a Plan
Year and who is to receive Restricted Shares for the Plan Year pursuant to
Article 4, his or her Annual Retainer with respect to such Plan Year shall be
provided in the form of a grant of Restricted Shares made on the last business
day of the Plan Quarter in which he or she becomes a Participant (except that if
the Plan Quarter ends on February 28 (or 29), the grant of Restricted Shares
shall be made on the next following March 15, or the next business day after
March 15 if March 15 is not a business day). The Restricted Shares so granted
shall have a Fair Market Value on such date equal to the amount of the
applicable Annual Retainer multiplied by a fraction, the numerator of which is
the number of days remaining in such Plan Year from and after the date the
individual becomes a Participant and the denominator of which is the number of
days in the Plan Year. Fractional Shares shall be paid in cash.
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<PAGE>
If an increase in the Annual Retainer becomes effective during a Plan
Year, an additional grant of Restricted Shares shall be made on the last day of
the Plan Quarter in which the increase in the Annual Retainer becomes effective
(except that if the last day of the Plan Quarter is February 28 (or 29), the
grant shall be made on the next following March 15, or the next business day
after March 15 if March 15 is not a business day). The Restricted Shares so
granted shall have a Fair Market Value on such date equal to the amount of such
increase multiplied by a fraction, the numerator of which is the number of days
remaining in the Plan Year from and after the effective date of the increase and
the denominator of which is 365. Fractional Shares shall be paid in cash. Any
increase in the Annual Retainer during a Plan Year shall be paid in Restricted
Shares, without regard to whether the Participant elected to receive his or her
Annual Retainer as of the beginning of the Plan Year in the form of Options.
6.3 TERMS OF RESTRICTED SHARES. Each grant of Restricted Shares
under the Plan shall comply with the following terms and conditions:
(a) Each grant shall state the number of Restricted Shares to
be granted.
(b) Restricted Shares may not be sold, assigned, transferred,
pledged, hypothecated or otherwise disposed of (except by will or the applicable
laws of descent and distribution) during the Restricted Period.
(c) Subject to Sections 6.3(d) and 6.3(f) hereof, the
Restricted Period for Restricted Shares granted under the Plan shall begin with
their grant and end upon completion of the Plan Year in which they are granted.
(d) Except as provided in Section 6.3(f) hereof, if during the
Restricted Period a Participant's service as a member of the Board (whether or
not a non-employee member) terminates, the Participant shall receive a number of
unrestricted Shares (except as described below) determined by multiplying the
number of Restricted Shares held by the Participant by a fraction, the numerator
of which shall be the number of days during which the Participant served as a
director during the Restricted Period and the denominator of which shall be the
number of days in the Restricted Period. Any additional Shares shall be
forfeited. The Shares issued shall be subject to the six-month sale restriction
of Section 6.3(g) below.
(e) During the Restricted Period, the Participant shall
possess all incidents of ownership of such Restricted Shares, including the
right to vote and to receive dividends with respect to such Restricted Shares,
subject to the restrictions and limitations described in this Article.
(f) Upon the termination of a Participant's service as a
member of the Board which results from the Participant's death or Disability, or
upon the occurrence of a Change in Control of the Company, all restrictions then
outstanding with respect to Restricted Shares granted hereunder shall
automatically expire and be of no further force and effect.
(g) Notwithstanding any other provisions hereof, unless an
event described in Section 6.3(f) occurs, no Shares from a grant of Restricted
Shares may be sold until at least six months after the date of grant of the
Restricted Shares.
(h) Upon the grant of Restricted Shares, either (i) a share
certificate or certificates representing such Restricted Shares shall be
registered in the Participant's name, shall bear an appropriate legend referring
to the restrictions applicable thereto, and shall be held in custody by an
escrow agent appointed by the Committee for the account of the Participant, or
(ii) the Company's share transfer agent or other designee shall credit such
Restricted Shares to the Participant's Restricted Shares account, which Shares
shall be subject to the restrictions applicable thereto under the Plan. Any
attempt to dispose of any such Shares in contravention of such restrictions
shall be null and void and without effect.
(i) A Participant shall have only the rights as a shareholder
described in Section 6.3(e) with respect to any Restricted Shares during the
Restricted Period. No adjustment shall be made for
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<PAGE>
dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distribution of other rights for which the record date is prior to
the date an unrestricted Share certificate is issued, except as provided in
Article 12 hereof.
7. DEFERRAL ELECTIONS.
7.1 ELECTIONS. Each Participant may elect to defer the receipt (a
"Deferral Election") of all or a portion of the Shares under Article 5 and the
Restricted Shares under Article 6 that are otherwise deliverable to the
Participant with respect to his or her services as a director during a Plan Year
("Deferred Shares"). When the applicable deferral period ends, such Deferred
Shares shall be deliverable in unrestricted Shares.
The Participant shall elect (a) that Deferred Shares be distributed in
a lump sum or in equal annual installments (not exceeding ten), and (b) that the
lump sum or first installment be distributed on the tenth day of the calendar
year immediately following either (i) the year in which the Participant ceases
to be a director of the Company, or (ii) the earlier of the year in which the
Participant ceases to be a director of the Company or a date designated by the
Participant, provided, however, that any such election shall be subject to
Article 9 hereof. Installments subsequent to the first installment shall be
distributed on the tenth day of each succeeding calendar year until all of the
Participant's Deferred Shares shall have been distributed.
In the event the Participant should die before all of the Participant's
Deferred Shares have been distributed, the balance of the Deferred Shares shall
be distributed in a lump sum to the person or persons whom the Participant shall
have designated in writing on a form prescribed by and filed with the Committee,
or, if no such designation has been made, to the person or persons to whom the
Participant's rights shall have passed by will or the laws of descent and
distribution. The Committee may require an indemnity and such evidence or other
assurances as it may deem necessary in connection with an exercise by a legal
representative, guardian, beneficiary or successor.
In the event the Participant should terminate his or her service as a
member of the Board during the period which would have been a Restricted Period
with respect to a particular grant of Deferred Shares hereunder, except that the
Participant made an effective Deferral Election with respect to such grant, such
Deferred Shares shall be treated in the same manner as Restricted Shares under
Sections 6.3(d) and 6.3(f) hereof.
7.2 TIMING AND FORM OF DEFERRAL ELECTIONS. Any deferral election:
(a) shall be in the form of a document executed by the
Participant and filed with the Secretary of the Company,
(b) shall be made before the first day of the Plan Year in
which the applicable retainer fee or meeting fees are earned and shall become
irrevocable on the last day prior to the beginning of such Plan Year (except
that an election with respect to the first Plan Year in which an individual
becomes a Participant shall be made before the first date on which he or she is
a Participant and shall become irrevocable on the last day prior to such date),
and
(c) shall continue until a Participant ceases to be a director
or until he or she terminates or modifies such election by written notice, any
such termination or modification to be effective as of the end of the Plan Year
in which such notice is given with respect to fees payable in subsequent Plan
Years.
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8. DIVIDEND EQUIVALENTS.
Deferred Shares shall be credited with an amount equivalent to the
dividends which have been paid on an equal number of outstanding Shares
("Dividend Equivalents"). Dividend Equivalents shall be credited (i) as of the
payment date of such dividends, and (ii) only with respect to Deferred Shares
which were otherwise deliverable, or into which Dividend Equivalents were
converted pursuant to the second paragraph of this Article 8, prior to the
record date of the dividend. Deferred Shares held pending distribution shall
continue to be credited with Dividend Equivalents.
Dividend Equivalents so credited shall be converted into an additional
whole number of Deferred Shares as of the payment date of the dividend (based on
the Fair Market Value of a Share on such payment date). Such Deferred Shares
shall thereafter be treated in the same manner as any other Deferred Shares
under the Plan. Dividend Equivalents resulting in fractional shares shall be
held for the credit of the Participant until the next dividend payment date and
shall be converted into Deferred Shares on such date. Upon the final
distribution of the Participant's Deferred Shares, any Dividend Equivalents not
previously converted into Deferred Shares shall be paid in cash.
9. EFFECT OF CERTAIN EVENTS.
Notwithstanding a deferral election pursuant to Article 7 hereof:
(a) If, as determined by the Board in its sole discretion, the
Participant (during or following his or her membership on the Board) engages in
any activity or association in competition with or adverse or detrimental to the
interests of the Company (i) all of such Participant's Deferred Shares shall be
distributed immediately in the form of Shares, (ii) Dividend Equivalents not yet
converted into Deferred Shares shall be distributed immediately in cash, and
(iii) all of such Participant's fees earned and not yet converted into Shares,
Restricted Shares or Deferred Shares under the terms of this Plan shall be
distributed in the form of Shares as soon as practicable, with any fractional
Share being distributed in cash.
(b) Upon the occurrence of a Change in Control, (i) all
Deferred Shares to the extent credited prior to the Change in Control shall be
distributed immediately in the form of Shares, and (ii) all Dividend Equivalents
not yet converted into Deferred Shares and all fees earned and not yet converted
into Shares, Restricted Shares, Deferred Shares or Options under the terms of
this Plan shall be distributed immediately in cash.
10. GRANT OF OPTIONS.
10.1 GRANT OF OPTIONS WITH RESPECT TO ANNUAL RETAINERS. Each
individual who is a Participant at the beginning of a Plan Year and who has
elected to receive Options for the Plan Year pursuant to Article 4 shall have
his or her Annual Retainer for the Plan Year converted into an Option to
purchase Shares pursuant to the formula described below. The Company shall grant
the Option, at the direction of the Committee, on the first business day of the
Plan Year (the "Date of Grant"). The Board may determine that Option grants
shall be subject to approval of the Board. Each Option shall be a non-qualified
stock option and shall be evidenced by a Share Option Agreement in such form as
the Committee shall approve. The Committee shall determine the number of Shares
for which the Participant shall receive an Option for the Plan Year based on the
following formula:
(a) First, the Committee shall determine the value (as of the
last trading day immediately before the Date of Grant) of an option to purchase
Shares for a ten-year period, as determined by the Black-Scholes option pricing
formula. The Committee shall use the Black-Scholes value based on a stock price
equal to 80% of the Fair Market Value of a Share on the Date of Grant.
(b) The number of Shares to be covered by the Option shall be
determined by dividing the Annual Retainer by one-half of the value of an option
determined under subsection (a) above and shall be rounded down to the nearest
whole Share.
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<PAGE>
(c) Any portion of an Annual Retainer that is not converted
into an Option shall be paid in the form of Restricted Shares, except that
fractional Shares shall be paid in cash.
10.2 OPTION PRICE. The option exercise price of each Option granted
under the Plan shall be the Fair Market Value on the Date of Grant of the Shares
covered by the Option.
10.3 NEW PARTICIPANTS. An individual who becomes a Participant
during a Plan Year and who elects to receive an Option for the Plan Year
pursuant to Article 4 shall receive an Option on the last business day of the
Plan Quarter in which he or she becomes a Participant (except that if the Plan
Quarter ends on February 28 (or 29), the Date of Grant for the Option shall be
the next following March 15, or the next business day after March 15 if March 15
is not a business day). The Committee shall grant the Participant an Option
based on the Participant's Annual Retainer multiplied by a fraction, the
numerator of which is the number of days remaining in such Plan Year from and
after the date the individual becomes a Participant and the denominator of which
is the number of days in the Plan Year. The Option shall be based on the Fair
Market Value of Shares on the Date of Grant in the manner described in Section
10.1.
10.4 OPTION TERM; VESTING.
(a) An Option may not be exercised after the first to occur of
(i) ten years from the Date of Grant or (ii) three months after the Participant
ceases to be a Director for any reason. Any Option not exercised within the
foregoing Option term shall automatically terminate at the expiration of such
Option term.
(b) Except as set forth below, an Option may not be exercised
until the end of the Plan Year in which the Option is granted, and shall be
exercisable as of that date only if the Participant has continued to serve as a
director of the Company through that Plan Year. Except as provided below, if a
Participant ceases to be a member of the Board during such Plan Year, the Option
shall terminate. In that event, the Company shall grant to the Participant
unrestricted Shares (except as provided below) in the amount that would have
been computed for the Plan Year pursuant to Section 6.3(d) if the Participant
had elected to have his or her Annual Retainer paid in the form of Restricted
Shares. The Shares issued shall be subject to the six-month sale restriction of
Section 6.3(g), with the six-month period measured from the Date of Grant of the
Option.
(c) If a Participant ceases to be a member of the Board on
account of the Participant's death or Disability, or upon the occurrence of a
Change in Control of the Company, the Participant's outstanding Options shall be
fully vested and exercisable. In the event of the death of a Participant, the
Participant's outstanding Options may be exercised by the person or persons whom
the Participant shall have designated in writing on a form prescribed by and
filed with the Committee, or, if no such designation has been made, by the
person or persons to whom the Participant's rights shall have passed by will or
the laws of descent and distribution. The Committee may require an indemnity and
such evidence or other assurances as it may deem necessary in connection with an
exercise by a legal representative, guardian, beneficiary or successor.
10.5 EXERCISE AND PAYMENT.
(a) An exercisable Option may be exercised by notice (in the
form prescribed by the Committee) to the Company specifying the number of Shares
to be purchased. Payment for the number of Shares purchased upon the exercise of
an Option shall be made in full at the price provided for in the applicable
Share Option Agreement. Such purchase price shall be paid by the delivery to the
Company of cash (including check or similar draft) in United States dollars or
whole Shares (subject to any restrictions the Committee may impose), or a
combination thereof. Shares used in payment of the purchase price shall be
valued at their Fair Market Value as of the date the notice of exercise is
received by the Company. Any Shares delivered to the Company shall be in such
form as is acceptable to the Company.
(b) The Company may defer making delivery of Shares under the
Plan until satisfactory arrangements have been made for the payment of any tax
attributable to exercise of the Option.
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<PAGE>
The Committee may, in its sole discretion, permit a Participant to elect, in
such form and at such time as the Committee may prescribe, to pay all or a
portion of any taxes arising in connection with the exercise of an Option by
electing to (a) have the Company withhold whole Shares, or (b) deliver other
whole Shares previously owned by the Participant having a Fair Market Value not
greater than the amount to be withheld; provided that the amount to be withheld
shall not exceed the total Federal, State and local tax withholding obligations
associated with the transaction. Notwithstanding the foregoing, any tax
withholding obligation with respect to each Section 16 insider under the
Exchange Act shall be satisfied solely by the Company's withholding of whole
Shares.
10.6 NONTRANSFERABILITY. No Option or any rights with respect thereto
shall be subject to any debts or liabilities of a Participant, nor shall they be
assignable or transferable except by will or the laws of descent and
distribution; provided that, if the Committee deems it appropriate, an Option
may permit the Participant to transfer the Option to one or more transferees
during the Participant's lifetime, and such transferees may exercise rights
thereunder in accordance with the terms hereof, but only if and to the extent
permitted by the Committee.
10.7 RIGHTS AS A SHAREHOLDER. A Participant shall have no rights as a
record holder with respect to Shares covered by his or her Option until the date
of issuance to him or her of a certificate evidencing such Shares after the
exercise of such Option and payment in full of the purchase price. No adjustment
will be made for cash dividends for which the record date is prior to the date
such certificate is issued.
11. CHANGE IN CONTROL OF THE COMPANY.
The first to occur of any of the following events shall be deemed a
Change in Control of the Company; provided, however, that in no event shall the
initial public offering of the Shares be deemed a Change in Control of the
Company for purposes of this Plan:
(i) the "beneficial ownership" (as defined in Rule
13d-3 under the Exchange Act) of securities representing more than 20% of the
combined voting power of the Company is acquired by any "person," as defined in
sections 13(d) and 14(d) of the Exchange Act (other than Kmart Corporation, the
Company, any trustee or other fiduciary holding securities under an employee
benefit plan of the Company, or any corporation owned, directly or indirectly,
by the shareholders of the Company in substantially the same proportions as
their ownership of Shares of the Company, or any "person" acquiring such
securities in a sale or transfer by Kmart Corporation in a transaction not
involving a public offering), or
(ii) the shareholders of the Company approve a
definitive agreement to merge or consolidate the Company with or into another
corporation or to sell or otherwise dispose of all or substantially all of its
assets, or adopt a plan of liquidation, or
(iii) during any period of three consecutive years
beginning after the completion of the initial public offering of the Shares,
individuals who at the beginning of such period were members of the Board cease
for any reason to constitute at least a majority thereof (unless the election,
or the nomination for election by the Company's shareholders, of each new
director was approved by a vote of at least a majority of the directors then
still in office who were directors at the beginning of such period or whose
election or nomination was previously so approved).
12. EFFECT OF CERTAIN CHANGES.
In the event of any extraordinary dividend, share dividend,
recapitalization, merger, consolidation, share split, warrant or rights
issuance, or combination or exchange of such shares, or other similar
transactions, the number and type of Shares available for grant, the number and
type of outstanding Restricted Shares, Deferred Shares and Options, and the
Option price of outstanding Options shall be equitably adjusted by the Committee
to reflect such event and preserve the value of such grants, and the Committee
may make such other adjustments to the terms of outstanding Restricted Shares,
Deferred Shares and
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<PAGE>
Options as it may deem equitable under the circumstances; provided, however,
that any fractional Shares resulting from such adjustment shall be eliminated.
13. NO RIGHTS TO CONTINUANCE AS DIRECTOR.
Nothing in the Plan or in any grant made pursuant hereto shall confer
upon any Participant the right to continue to serve as a member of the Company's
Board or to be entitled to any remuneration or benefits not set forth in the
Plan.
14. ADMINISTRATION.
The Plan shall be administered by the Committee, except as otherwise
specifically provided in the Plan. The Committee shall have the full authority
and discretion to make such interpretations and constructions of the Plan as are
necessary to administer the Plan in accordance with, and subject to, the Plan's
provisions. Without limiting the foregoing, the Committee is specifically
authorized to make such modifications to the administration of the Plan as it
deems appropriate if an annual meeting of the Company's shareholders is not held
on a date that is approximately 12 months after the last annual shareholders
meeting. If the Board deems it appropriate, the Board may reserve the right to
approve grants under the Plan.
The Board shall fill all vacancies, however caused, in the Committee.
The Board may from time to time appoint additional members to the Committee, and
may at any time remove one or more Committee members and substitute others. The
Committee may appoint a chairperson and a secretary and make such rules and
regulations for the conduct of its business as it shall deem advisable, and
shall keep minutes of its meetings. The Committee shall hold its meetings at
such times and places as it shall deem advisable. All determinations of the
Committee shall be made by a majority of its members either present in person or
participating by conference telephone at a meeting or by unanimous written
consent. The Committee may delegate to one or more of its members or to one or
more agents such administrative duties as it may deem advisable, and the
Committee or any person to whom it has delegated duties as aforesaid may employ
one or more persons to render advice with respect to any responsibility the
Committee or such person may have under the Plan.
All decisions, determinations and interpretations of the Committee and
the Board shall be final and binding on all persons, including the Company, the
Participant (or any person claiming any rights under the Plan from or through
any Participant) and any shareholder. No member of the Board or Committee shall
be liable for any action taken or determination made in good faith with respect
to the Plan or any grant hereunder.
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<PAGE>
15. AMENDMENT AND TERMINATION OF THE PLAN.
The Board at any time and from time to time may suspend, terminate,
modify or amend the Plan; provided, however, that an amendment which requires
shareholder approval in order for the Plan to continue to comply with any law,
regulation or stock exchange requirement shall not be effective unless approved
by the requisite vote of shareholders. Except as provided in Article 12 hereof,
no suspension, termination, modification or amendment of the Plan may adversely
affect any grant previously made, unless the written consent of the Participant
is obtained.
16. GOVERNING LAW.
The Plan and the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the State of Delaware
without giving effect to the choice of law principles thereof, except to the
extent that such law is preempted by federal law.
17. APPROVAL OF SHAREHOLDERS.
17.1 The amended and restated Plan shall take effect upon its adoption
by the Board and approval by the shareholders of the Company.
17.2 The Plan shall remain in effect until December 31, 2004, unless
sooner terminated by the Board; provided, however, that Shares and Dividend
Equivalents may be delivered pursuant to a Deferral Election after such date,
the Restricted Period of Restricted Shares granted prior to such date may extend
beyond such date, Options granted prior to such date may be exercised after such
date, and the provisions of the Plan shall continue to apply to such Deferred
Shares, Dividend Equivalents, Restricted Shares and Options.
18. MISCELLANEOUS.
18.1 The right of a Participant to Restricted Shares, Deferred Shares,
Dividend Equivalents and Options shall be non-assignable (except as specifically
provided otherwise in the Plan) and shall not be subject in any manner to the
debts or other obligations of the Participant or any other person.
18.2 The Company shall not be required to reserve or otherwise set
aside funds with respect to grants under the Plan.
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EXHIBIT 5
August 5, 1997
The Sports Authority, Inc.
3383 North State Road 7
Ft. Lauderdale, Florida 33319
Re: The Sports Authority, Inc. -- Form S-8 Registration Statement
Relating to The Sports Authority, Inc. Amended and Restated Director
Stock Plan
Ladies and Gentlemen:
As your counsel, we have assisted in the preparation of the above-referenced
Registration Statement on Form S-8 (the "Registration Statement") for filing
with the Securities and Exchange Commission pursuant to the Securities Act of
1933, as amended (the "Act"), and the rules and regulations promulgated
thereunder.
The Registration Statement relates to 70,317 shares of Common Stock, par value
$.01 per share (the "Common Stock"), of The Sports Authority, Inc. (the
"Company") which may be issued pursuant to The Sports Authority, Inc. Amended
and Restated Director Stock Plan (the "Plan"). We have examined the Company's
Certificate of Incorporation, as amended, By-Laws, as amended, minutes and such
other documents, and have made such inquiries of the Company's officers, as we
have deemed appropriate. In our examination, we have assumed the genuineness of
all signatures, the authenticity of all items submitted to us as originals, and
the conformity with originals of all items submitted to us as copies.
Based upon the foregoing, it is our opinion that the Company's Common Stock,
when issued and delivered as contemplated by the Plan, will be legally issued,
fully paid and non-assessable.
The foregoing opinion is limited to the General Corporation Law of the State of
Delaware.
We hereby consent to the use of this opinion as Exhibit 5 to the Registration
Statement. In giving such consent, we do not thereby admit that we are acting
within the category of persons whose consent is required under Section 7 of the
Act or the rules or regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Morgan, Lewis & Bockius LLP
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EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated March 3 1997, which appears on page 17
of the 1996 Annual Report to the Shareholders of The Sports Authority, Inc. (the
"Company"), which is incorporated by reference in the Company's Annual Report on
Form 10-K for the year ended January 26, 1997. We also consent to the reference
to us under the heading "Interests of Named Experts and Counsel" in such
Registration Statement on Form S-8.
/s/ PRICE WATERHOUSE LLP
Fort Lauderdale, Florida
August 5, 1997
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