<PAGE> 1
As filed with the Securities and Exchange Commission on September 30, 1998
Registration No. _____________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Guinness Telli*Phone Corporation
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(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Nevada 68-0310550
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(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
655 Redwood Hwy., #273, Mill Valley, California 94941
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(Address of Principal Executive Offices) (Zip Code)
</TABLE>
Guinness Telli*Phone Corporation Stock Option Plan
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(Full title of the plan)
Lawrence A. Guinness, 655 Redwood Hwy., Mill Valley, California 94941
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(Name and address of agent for service)
(415) 389-9442
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(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate offering Amount of
to be registered registered per share price registration fee (1)
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<S> <C> <C> <C> <C>
Common Stock,
$.001 Par Value (2) 4,000,000 $0.125 $500,000 $147.50
=====================================================================================================================
TOTALS 4,000,000 $500,000 $147.50
=====================================================================================================================
</TABLE>
(1) The fee with respect to these shares has been calculated pursuant to Rule
457 of Regulation C under the Securities Act of 1933, as amended, and based
upon the average of the bid and asked price per share of the Registrant's
Common Stock on a date within five (5) days prior to the date of filing of
this Registration Statement, as reported on the National Association of
Securities Dealers, Inc.'s Electronic Bulletin Board.
(2) To be issued, at the sole discretion of the Registrant, as Direct Shares,
or Shares underlying options granted to and to be granted, under the
Guinness Telli*Phone Corporation Stock Option Plan.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE PROSPECTUS
The document(s) containing the information concerning the Guinness
Telli*Phone Corporation Stock Option Plan, effective as of September 30, 1998
(the "Plan"), required by Item 1 of Form S-8 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the statement of availability of
registrant information, employee benefit plan annual reports and other
information required by Item 2 of Form S-8 will be sent or given to participants
as specified by Rule 428. In accordance with Rule 428 and the requirements of
Part I of Form S-8, such documents are not being filed with the Securities and
Exchange Commission (the "Commission") either as part of this registration
statement on Form S-8 (the "Registration Statement") or as prospectuses or
prospectus supplements pursuant to Rule 424. Guinness Telli*Phone Corporation, a
Nevada corporation (the "Company"), shall maintain a file of such documents in
accordance with the provisions of Rule 428. Upon request, the Company shall
furnish to the Commission or its staff a copy or copies of all of the documents
included in such file.
1
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The content of the Company's Annual Report on Form 10-K for the year
ended December 31, 1997, and Quarterly Report on Form 10-Q for the quarterly
period ended June 30, 1998 are incorporated by reference into this Registration
Statement. All documents filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Registration Statement and prior to the termination of the offering shall be
deemed to be incorporated by reference into this Registration Statement and to
be a part hereof from the date of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Registration Statement to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be 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 of this Registration Statement. The Company will provide
without charge to each person to whom a copy of this Registration Statement is
delivered, on the written or oral request of such person, a copy of any or all
of the documents referred to above which have been or may be incorporated by
reference into this Registration Statement, other than certain exhibits to such
documents. Requests for such copies shall be directed to Shareholder Relations,
Guinness Telli*Phone Corporation, 655 Redwood Hwy., #273, Mill Valley,
California 94941, telephone (415) 389-9442.
ITEM 4. DESCRIPTION OF SECURITIES.
COMMON STOCK.
The Articles of Incorporation of the Company authorizes the issuance of
25,000,000 shares of Common Stock, $.001 par value. The Common Stock will
receive such dividends, if any, as may be declared b the Board of Directors out
of funds legally available for such purposes. Under the Corporation's Code of
the State of Nevada, dividends may be paid to stockholders from a corporation's
excess of its assets over its liabilities, including capital, as computed in
accordance with the provisions of Nevada Revised Statutes 78.270 to 78.410,
inclusive, or in case there shall be no such excess, out of its net profits for
the fiscal year then current and the preceding fiscal year, but not otherwise.
Holders of the Common Stock (i) have no conversion rights; (ii) have no sinking
fund rights; (iii) have no redemption provisions; (iv) are entitled to one vote
per share on all matters submitted to a vote of holders of Common Stock; (v) do
not have any cumulative voting rights; (vi) do not have any preemption rights.
In the event of a liquidation, dissolution or winding-up of the Company, the
holders of Common Stock are entitled to share equally and ratably in the assets
of the Company, if any, remaining after the payment of all debts and liabilities
of the Company and the liquidation preference of any preferred stock that may be
then outstanding. The outstanding Common Stock is, and the shares to be issued
in this offering, when and if issued, will be fully paid and non-assessable.
There is no restriction on alienability of the securities to be registered.
There is no provision discriminating against any existing or prospective holder
of the securities as a result of any securities holder owning a substantial
amount of securities. Additional authorized but unissued Common Stock may be
issued by the Company's Board of Directors without the approval of the
shareholders.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Futro & Trauernicht, LLC, Attorneys and Counselors at Law, special
securities counsel to the Company, and whose opinion as to the legality of the
issuance of shares hereunder is attached hereto as Exhibit 5.1, may in the
future be issued shares or options to purchase shares pursuant to the Plan,
which shares of $.001 par value Common Stock may be restricted or registered
pursuant to this Registration Statement.
2
<PAGE> 4
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Articles of Incorporation, in accordance with the Corporation Laws
of the State of Nevada provides:
"In accordance with Section 78.037 of the Nevada Business Corporation
Code, the directors and officers of this corporation shall not be personally
liable to the corporation or its stockholders for damages for breach of
fiduciary duty as a director or officer, so long as the acts or omissions did
not involve intentional misconduct, fraud or a knowing violation of law or as a
result of the payment of dividends in violation of NRS 78.300."
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit Number Description
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4.1 The Company's Articles of Incorporation, as
amended, define the rights of holders of the
equity securities being registered, which
are included as exhibits to the Company's
Form 10, filed with the SEC on March 8,
1996, File No. 0-25632 (2)
4.2 The Company's Bylaws define the rights of
holders of the equity securities being
registered, which are included as exhibits
to the to the Company's Form 10, filed with
the SEC on March 8, 1996, File No. 0-25632
(3)
5.1 Opinion of Counsel, Futro & Trauernicht,
LLC (1)
10.1 Guinness Telli*Phone Corporation Stock
Option Plan adopted by the Company on
September 30, 1998 (1)
23.1 Consent of BDO Seidman, LLP, Certified
Public Accountants (1)
23.2 Consent of Futro & Trauernicht, LLC (4)
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(1) Filed herewith.
(2) Incorporated by reference to Exhibit 2 to the Company's Form 10, filed
with the SEC on March 8, 1996, File No. 0-25632.
(3) Incorporated by reference to Exhibit 2 to the Company's Form 10, filed
with the SEC on March 8, 1996, File No. 0-25632.
(4) Included in Exhibit 5.1.
ITEM 9. UNDERTAKINGS.
The undersigned Company 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;
3
<PAGE> 5
(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.
(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 tide 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.
(4) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling
persons of the Company pursuant to the foregoing provisions, or
otherwise, the Company 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 that the payment by the Company of expenses incurred or paid by
a director, officer, or controlling person of the Company in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer, or controlling person of the Company in the
successful defense of that action suit, or proceeding) is asserted by
such director, officer, or controlling person in connection with the
securities being registered, the Company 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 of 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.
4
<PAGE> 6
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 or amendment to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Mill Valley, State of California, on the 30th
day of September, 1998.
GUINNESS TELLI*PHONE CORPORATION
By: /s/ Lawrence A Guinness
------------------------------------------------
Lawrence A. Guinness, President, Chief Executive
Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
By: /s/ Lawrence A Guinness
------------------------------------------------
Lawrence A. Guinness, President, Chief Executive
Officer and Director
Dated: September 30, 1998
By: /s/ Dixie K. Tanner
------------------------------------------------
Dixie K. Tanner, Vice President - Publishing,
Secretary and Director
Dated: September 30, 1998
By: /s/ Arthur Korn
------------------------------------------------
Arthur Korn, Chief Financial Officer, Director
Dated: September 30, 1998
5
<PAGE> 7
EXHIBIT INDEX
Exhibit Number Description
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4.1 The Company's Articles of Incorporation, as
amended, define the rights of holders of the
equity securities being registered, which
are included as exhibits to the Company's
Form 10, filed with the SEC on March 8,
1996, File No. 0-25632 (2)
4.2 The Company's Bylaws define the rights of
holders of the equity securities being
registered, which are included as exhibits
to the to the Company's Form 10, filed with
the SEC on March 8, 1996, File No. 0-25632
(3)
5.1 Opinion of Counsel, Futro & Trauernicht,
LLC (1)
10.1 Guinness Telli*Phone Corporation Stock
Option Plan adopted by the Company on
September 30, 1998 (1)
23.1 Consent of BDO Seidman, LLP, Certified
Public Accountants (1)
23.2 Consent of Futro & Trauernicht, LLC (4)
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(1) Filed herewith.
(2) Incorporated by reference to Exhibit 2 to the Company's Form 10, filed
with the SEC on March 8, 1996, File No. 0-25632.
(3) Incorporated by reference to Exhibit 2 to the Company's Form 10, filed
with the SEC on March 8, 1996, File No. 0-25632.
(4) Included in Exhibit 5.1.
<PAGE> 1
Exhibit 5.1
[FUTRO & TRAUERNICHT LLC - LETTERHEAD]
September 30, 1998
U.S. Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington D.C. 20549
Re: Guinness Telli*Phone Corporation
Form S-8 Registration Statement
OPINION OF COUNSEL NO. 98-273.1
Ladies and Gentlemen:
OPINION OF COUNSEL
We have acted as counsel to Guinness Telli*Phone Corporation (the
"Company") in connection with the preparation and filing of a Registration
Statement on Form S-8 (the "Registration Statement"). The Registration Statement
covers the registration under the Securities Act of 1933, as amended, of
2,000,000 shares of the Company's common stock, $.001 par value per share (the
"Shares"), pursuant to the Company's employee and consultant benefit plan
entitled the "Guinness Telli*Phone Corporation Stock Option Plan," adopted by
the Board of Directors of the Company on September 30, 1998 (the "Plan"). As
such, we have examined the Registration Statement, the Company's Articles of
Incorporation and Bylaws, as amended, and minutes of meetings of its Board of
Directors.
Based upon the foregoing, and assuming that the Shares will be issued
as set forth in the Plan and Registration Statement, at a time when effective,
and that the Company will fully comply with all applicable securities laws
involved under the Securities Act of 1933, as amended, the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated pursuant to
said Acts, and in those states or foreign jurisdictions in which the Shares may
be sold, we are of the opinion that, upon proper and legal issuance of the
Shares according the Registration Statement and receipt of the consideration to
be paid for the Shares, the Shares will be validly issued, fully paid and
nonassessable shares of Common Stock of the Company. This opinion does not cover
any matters related to any re-offer or re-sale of the Shares by any Plan
Beneficiaries, once properly and legally issued pursuant to the Plan as
described in the Registration Statement.
This opinion is not to be used, circulated, quoted or otherwise
referred to for any other purpose without our prior written consent. This
opinion is based on our knowledge of the law and facts as of the date hereof.
This opinion does not address or relate to any specific state securities laws.
We assume no duty to communicate with the Company in respect to any matter which
comes to our attention hereafter.
<PAGE> 2
U.S. Securities and Exchange Commission
September 30, 1998
Page 2
CONSENT
We consent to the use of this opinion as an exhibit to the Registration
Statement and to the reference to our firm in the prospectus which is made a
part of the Registration Statement.
Sincerely,
FUTRO & TRAUERNICHT LLC
/s/ Peter G. Futro
Peter G. Futro
<PAGE> 1
Exhibit 10.1
GUINNESS TELLI*PHONE CORPORATION
STOCK OPTION PLAN
(SEPTEMBER 1998)
SECTION 1. INTRODUCTION
1.1 Establishment. Effective as provided in Section 17, Guinness
Telli*Phone Corporation, a Nevada corporation (the "Company"), hereby restates
this plan of long-term stock-based compensation incentives for selected Eligible
Participants of the Company and its affiliated corporations. The plan is known
as the Guinness Stock Option Plan (the "Plan"). The Plan was adopted by the
Company on September 30, 1998.
1.2 Purpose. The purpose of the Plan is to promote the best interest of
the Company, and its stockholders by providing a means of non-cash remuneration
to selected Eligible Participants who contribute most to the operating progress
and earning power of the Company.
SECTION 2. DEFINITIONS
The following definitions shall be applicable to the terms used in the
Plan:
2.1 "Affiliated Corporation" means any corporation that is either a
parent corporation with respect to the Company or a subsidiary corporation with
respect to the Company (within the meaning of Sections 424(e) and (f),
respectively, of the Internal Revenue Code).
2.2 "Code" means the Internal Revenue Code of 1986, as it may be
amended from time to time.
2.3 "Committee" means a committee designated by the Board of Directors
to administer the Plan or, if no committee is so designated, the Board of
Directors. Any Committee Member who is also an Eligible Participant may receive
a grant only if he abstains from voting in favor of a grant to himself, and the
grant is determined and approved by the remaining Committee Members. The Board
of Directors, in its sole discretion, may at any time remove any member of the
Committee and appoint another Director to fill any vacancy on the Committee.
2.4 "Common Stock" means the Company's $.001 par value voting common
stock.
2.5 "Company" means Guinness Telli*Phone Corporation, a Nevada
corporation and its subsidiaries.
2.6 "Effective Date" means the effective date of the Plan, as set forth
in Section 17 hereof.
2.7 "Eligible Participant" or "Participant" means any employee,
director, officer, consultant, or advisor of the Company who is determined (in
accordance with the provisions of Section 4 hereof) to be eligible to receive
stock and exercise stock options hereunder.
2.8 "Fair Market Value" means with respect to Common Stock, as of any
date, the closing price of a share of Common Stock as reported on such exchange
on which the Company's Common Stock may be listed.
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 1 OF 6
<PAGE> 2
2.9 "Option" means the grant to an Eligible Participant of a right to
acquire shares of Restricted Stock of the Company, unless said shares are duly
registered, and thus freely tradeable, pursuant to a Grant of Option approved by
the Committee and executed and delivered by the Company.
2.10 "Plan" means this Guinness Telli*Phone Corporation Stock Option
Plan, adopted on September 30, 1998.
2.11 "Registered Stock" means shares of common stock, $.001 par value,
of the Company underlying an Option which, if specified in the written Option
are, upon issuance, freely tradeable by virtue of having been registered with
the Securities and Exchange Commission under cover of Form S-8, or another
appropriate registration statement, and which shares have been issued subject to
the "blue sky" provisions of any appropriate state jurisdiction. Special resale
restrictions may, however, apply to officers, directors, control shareholders
and affiliates of the Company and such persons will be required to obtain an
opinion of counsel as regards their ability to resell shares received pursuant
to this Plan.
2.12 "Stock" or "Restricted Stock" means shares of common stock, $.001
par value, of the Company issuable directly under the Plan or underlying the
grant of the Option, which are, upon issuance, subject to the restrictions set
forth in Section 11 hereof.
Wherever appropriate, words used in the Plan in the singular may mean
the plural, the plural may mean the singular, and the masculine may mean the
feminine.
SECTION 3. ADOPTION AND ADMINISTRATION OF THE PLAN
The Plan was adopted on September 30, 1998. In the absence of contrary
action by the Board of Directors, and except for action taken by the Committee
pursuant to Section 4 in connection with the determination of Eligible
Participants, any action taken by the Committee or by the Board of Directors
with respect to the implementation, interpretation or administration of the Plan
shall be final, conclusive and binding.
SECTION 4. ELIGIBILITY AND AWARDS
The Committee shall determine at any time and from time to time after
the effective date of the Plan: (i) the Eligible Participants; (ii) the number
of shares of Common Stock issuable directly or to be granted pursuant to an
Option which an Eligible Participant may exercise; (iii) the price per share at
which each option may be exercised, in cash or cancellation of fees for services
for which the Company is liable, if applicable, or the value per share if a
direct issue of stock; and (iv) the terms on which each option may be granted.
Such determination, as may from time to time be amended or altered at the sole
discretion of the Committee. Notwithstanding the provisions of Section 3 hereof,
no such determination by the Committee shall be final, conclusive and binding
upon the Company unless and until the Board of Directors has approved the same;
provided, however, that if the Committee is composed of a majority of the
persons then comprising the Board of Directors of the Company, such approval by
the Board of Directors shall not be necessary.
SECTION 5. GRANT OF OPTION
Subject to the terms and provisions of this Plan, the terms and
conditions under which an Option may be granted to an Eligible Participant shall
be set forth in a written agreement (i.e., a Consulting Agreement, Services
Agreement, Fee Agreement, or Employment Agreement) or as written Grant of Option
hereunder shall be in the form attached hereto as Exhibit A and made a part
hereof and containing such modifications thereto and such other provisions as
the Committee, in its sole discretion, may determine. Notwithstanding the
foregoing provisions of this Section 5, each Grant of Option shall incorporate
the provisions of this Plan by reference.
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 2 OF 6
<PAGE> 3
SECTION 6. TOTAL NUMBER OF SHARES OF COMMON STOCK
The total number of shares of Common Stock reserved for issuance by the
Company either directly or underlying Options granted under this Plan shall not
be more than 4,000,000. The total number of shares of Common Stock reserved for
such issuance may be increased only by a resolution adopted by the Board of
Directors and amendment of the Plan. Such Common Stock may be authorized and
unissued or reacquired common stock of the Company.
SECTION 7. PURCHASE OF SHARES OF COMMON STOCK
7.1 As soon as practicable after the determination by the Committee and
approval by the Board of Directors (if necessary, pursuant to Section 4 hereof)
of the Eligible Participants and the number of shares an Eligible Participant
may be issued directly or granted pursuant to an Option, the Committee shall
give notice (written or oral) thereof to each Eligible Participant, which notice
may be accompanied by the Grant of Option, if appropriate, to be executed by
such Eligible Participant. Upon receipt, an Eligible Participant may exercise
his right to an Option to purchase Common Stock by providing written notice as
specified in the Grant of Option.
7.2 The negotiated cost basis of stock issued directly or the exercise
price for each option to purchase shares of Common Stock pursuant to paragraph
7.1 shall be as determined by the Committee, it being understood that the price
so determined by the Committee may vary from one Eligible Participant to
another. In computing the negotiated direct issue price or the Option exercise
price of a share of Common Stock, the Committee shall take into consideration,
among other factors, the restrictions set forth in Section 11 hereof.
SECTION 8. PAYMENT UPON EXERCISE OF OPTION OR DIRECT ISSUANCE
The Committee shall determine the terms of the Grant of Option and the
exercise price or direct issue price for payment by each Participant for his
shares of Common Stock granted thereunder. Such terms shall be set forth or
referred to in the Grant of Option or Board Resolution authorizing the share
issuance. The terms and/or exercise price so set by the Committee may vary from
one Participant to another. In the event that all the Committee approves an
Option grant permitting deferred payments, the Participant's obligation to pay
for such Common Stock shall be evidenced by a Promissory Note executed by such
Participant and containing such modifications thereto and such other provisions
as the Committee, in its sole discretion, may determine.
SECTION 9. DELIVERY OF SHARES OF COMMON STOCK UPON EXERCISE
The Company shall deliver to or on behalf of each Participant such
number of shares of Common Stock as such Participant elects to purchase upon
direct issuance or upon exercise of the Option. Such shares, which shall be
fully paid and nonassessable upon the issuance thereof (unless a portion or all
of the purchase price shall be paid on a deferred basis) shall be represented by
a certificate or certificates registered in the name of the Participant and
stamped with an appropriate legend referring to the restrictions thereon, if
any, as may be set forth in the Grant of Option. Subject to the terms and
provisions of the Nevada Business Corporation Act and the Grant of Option to
which he is a party, a Participant shall have all the rights of a stockholder
with respect to such shares, including the right to vote the shares and to
receive all dividends or other distributions paid or made with respect thereto
(except to the extent such Participant defaults under the promissory note, if
any, evidencing the deferred purchase price for such shares), provided that such
shares shall be subject to the restrictions hereinafter set forth. In the event
of a merger or consolidation to which the Company is a party, or of any other
acquisition of a majority of the issued and outstanding shares of common stock
of the Company involving an exchange or a substitution of stock of an acquiring
corporation for common stock of the Company, or of any transfer of all or
substantially all of the assets of the Company in exchange for stock of an
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 3 OF 6
<PAGE> 4
acquiring corporation, a determination as to whether the stock of the acquiring
corporation so received shall be subject to the restrictions set forth in
Section 11 shall be made solely by the acquiring corporation.
SECTION 10. RIGHTS OF EMPLOYEES; PARTICIPANTS
10.1 Employment. Nothing contained in the Plan or in any Stock Option,
Restricted Stock award or other Common Stock award granted under the Plan shall
confer upon any Participant any right with respect to the continuation of his or
her employment by the Company or any Affiliated Corporation, or interfere in any
way with the right of the Company or any Affiliated Corporation, subject to the
terms of any separate employment agreement to the contrary, at any time to
terminate such employment or to increase or decrease the compensation of the
Participant from the rate in existence at the time of the grant of a Stock
Option or other Common Stock award. Whether an authorized leave of absence, or
absence in military or government service, shall constitute termination of
employment shall be determined by the Committee at the time.
10.2 Non-transferability. No right or interest of any Participant in a
Stock Option award shall be assignable or transferable during the lifetime of
the Participant, either voluntarily or involuntarily, or subjected to any lien,
directly or indirectly, by operation of law, or otherwise, including execution,
levy, garnishment, attachment, pledge or bankruptcy. In the event of a
Participant's death, a Participant's rights and interest in Stock Option awards
shall be transferable by testamentary will or the laws of descent and
distribution, and payment of any amounts due under the Plan shall be made to,
and exercise of any Stock Options may be made by, the Participant's legal
representatives, heirs or legatees. If in the opinion of the Committee a person
entitled to payments or to exercise rights with respect to the Plan is unable to
care for his or her affairs because of mental condition, physical condition, or
age, payment due such person may be made to, and such rights shall be exercised
by, such person's guardian, conservator or other legal personal representative
upon furnishing the Committee with evidence satisfactory to the Committee of
such status.
SECTION 11. GENERAL RESTRICTIONS
11.1 Investment Representations. The Company may require any person to
whom a Stock Option, Restricted Stock award, or other Common Stock award is
granted, as a condition of exercising such Stock Option, or receiving such
Restricted Stock award, or other Common Stock award, to give written assurances
in substance and form satisfactory to the Company and its counsel to the effect
that such person is acquiring the Common Stock subject to the Stock Option,
Restricted Stock award, or other Common Stock award for his or her own account
for investment and not with any present intention of selling or otherwise
distributing the same, and to such other effects as the Company deems necessary
or appropriate in order to comply with federal and applicable state securities
laws.
11.2 Compliance with Securities Laws. Each Stock Option shall be
subject to the requirement that if at any time counsel to the Company shall
determine that the listing, registration or qualification of the shares subject
to such Stock Option upon any securities exchange or under any state or federal
law, or the consent or approval of any governmental or regulatory body, is
necessary as a condition of, or in connection with, the issuance or purchase of
shares thereunder, such Stock Option may not be accepted or exercised in whole
or in part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained on conditions acceptable to the Committee.
Nothing herein shall be deemed to require the Company to apply for or to obtain
such listing, registration or qualification.
11.3 Changes in Accounting Rules. Notwithstanding any other provision
of the Plan to the contrary, if, during the term of the Plan, any changes in the
financial or tax accounting rules applicable to Stock Options, Restricted Stock
awards or other Common Stock awards shall occur that, in the sole judgment of
the Committee, may have a material adverse effect on the reported earnings,
assets or liabilities of the Company, the Committee shall have the right and
power to modify as necessary, or cancel, any then outstanding and unexercised
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 4 OF 6
<PAGE> 5
Stock Options, any then outstanding Restricted Stock awards as to which the
applicable employment restriction has not been satisfied and any other Common
Stock awards.
SECTION 12. WITHHOLDING REQUIREMENT
The Company's obligations to deliver shares of Common Stock upon the
exercise of any Stock Option granted under the Plan or pursuant to any other
Common Stock award, shall be subject to the Participant's satisfaction of all
applicable federal, state and local income and other tax withholding
requirements. The Company may, in its sole discretion, withhold the appropriate
number of shares of Common Stock from Participant's option exercise to satisfy
such tax requirements.
SECTION 13. PLAN BINDING UPON ASSIGNS OR TRANSFEREES
In the event that, at any time or from time to time, any shares of
Common Stock are sold, exchanged, assigned or transferred to any party (other
than the Company) pursuant to the provisions of Section 10.2 hereof, such party
shall take such shares of Common Stock pursuant to all provisions and conditions
of this Plan, and, as a condition precedent to the transfer of such shares of
Common Stock, such party shall agree (for and on behalf of himself or itself,
his or its legal representatives and his or its transferees and assigns) in
writing to be bound by all provisions of this Plan.
SECTION 14. COSTS AND EXPENSES
All costs and expenses with respect to the adoption, implementation,
interpretation and administration of the Plan shall be borne by the Company.
SECTION 15. CHANGES IN CAPITAL STRUCTURE OF THE COMPANY
Unless otherwise consented to by the Company in writing or unless
otherwise required by law, the shares of Restricted Stock issuable upon exercise
of the Option which are held by a Participant shall not be adjusted in any
manner for: (i) a subdivision or combination of any of the shares of capital
stock of the Company; (ii) a dividend payable in shares of capital stock of the
Company; (iii) a reclassification of any shares of capital stock of the Company;
or (iv) any other change in the capital structure of the Company.
SECTION 16. PLAN AMENDMENT, MODIFICATION AND TERMINATION
The Board, upon recommendation of the Committee or at its own
initiative, at any time may terminate and at any time and from time to time and
in any respect, may amend or modify the Plan, including:
(a) Increase the total amount of Common Stock that may be
awarded under the Plan, except as provided in Section 15 of the Plan;
(b) Change the classes of Eligible Employees from which
Participants may be selected or materially modify the requirements as
to eligibility for participation in the Plan;
(c) Increase the benefits accruing to Participants; or
(d) Extend the duration of the Plan.
Any Stock Option or other Common Stock award granted to a Participant
prior to the date the Plan is amended, modified or terminated will remain in
effect according to its terms unless otherwise agreed upon by the Participant;
provided, however, that this sentence shall not impair the right of the
Committee to take whatever action it deems appropriate under Section 11 or
Section 15. The termination or any modification or amendment of the Plan shall
not, without the consent of a Participant, affect his rights under a Stock
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 5 OF 6
<PAGE> 6
Option, Restricted Stock Award or other Common Stock award previously granted to
him. With the consent of the Participant, the Committee may amend outstanding
option agreements in a manner not inconsistent with the Plan. The Board shall
have the right to amend or modify the terms and provisions of the Plan and of
any outstanding Stock Options granted under the Plan.
SECTION 17. EFFECTIVE DATE OF THE PLAN
17.1 Effective Date. The Plan is effective as of September 30, 1998,
the date it was adopted by the Board of Directors of the Company.
17.2 Duration of the Plan. The Plan shall terminate at midnight on
September 30, 2003, which is the day before the fifth anniversary of the
Effective Date, and may be extended thereafter or terminated prior thereto by
action of the Board of Directors; and no Stock Option, Restricted Stock Award or
other Common Stock award shall be granted after such termination. Stock Options,
Restricted Stock Awards and other Common Stock awards outstanding at the time of
the Plan termination may continue to be exercised, or become free of
restrictions, in accordance with their terms.
SECTION 18. BURDEN AND BENEFIT
The terms and provisions of this Plan shall be binding upon, and shall
inure to the benefit of, each Participant, his executives or administrators,
heirs, and personal and legal representatives.
Dated the 30th day of September, 1998.
GUINNESS TELLI*PHONE CORPORATION
By: /s/ Lawrence A. Guinness
------------------------------------
Lawrence A. Guinness, President
ATTEST:
/s/ Dixie K. Tanner
- --------------------------------
Dixie K. Tanner, Secretary
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GUINNESS STOCK OPTION PLAN (9/98) PAGE 6 OF 6
<PAGE> 7
EXHIBIT A
FORM OF
GRANT OF OPTION PURSUANT TO THE
GUINNESS TELLI*PHONE CORPORATION STOCK OPTION PLAN
Guinness Telli*Phone Corporation, a Nevada corporation (the "Company"),
hereby grants to ________________________________ ("Optionee") an option to
purchase ___________ shares of common stock, $.001 par value (the "Shares") of
the Company at the purchase price of $______ per share (the "Purchase Price") in
accordance with and subject to the terms and conditions of the Guinness Stock
Option Plan. This option is exercisable in whole or in part, and upon payment in
cash or cancellation of fees, or other form of payment acceptable to the
Company, to the offices of the Company at 655 Redwood Hwy., #273, Mill Valley,
California 94941. This Grant of Option form supersedes and replaces any prior
notice of option grant, description of vesting terms or similar documents
previously delivered to Optionee for options granted on the date stated below.
Unless otherwise set forth in a separate employment or consulting
agreement executed prior to September 30, 1998, in the event that Optionee's
employee or consultant status with the Company or any of its subsidiaries ceases
or terminates for any reason whatsoever, including, but not limited to, death,
disability, or voluntary or involuntary cessation or termination, this Grant of
Option shall terminate with respect to any portion of this Grant of Option that
has not vested prior to the date of cessation or termination of employee or
consultant status, as determined in the sole discretion of the Company. In the
event of termination for cause, this Grant of Option shall immediately terminate
in full with respect to any un-exercised options, and any vested but
un-exercised options shall immediately expire and may not be exercised. Unless
otherwise set forth in a separate employment or consulting agreement, vested
options must be exercised within one (1) year after the date of termination
(other than for cause), notwithstanding the Expiration Date set forth above.
Subject to the preceding paragraph, this Grant of Option, or any
portion hereof, may be exercised only to the extent vested per the attached
schedule, and must be exercised by Optionee no later than ______________________
(the "Expiration Date") by (i) notice in writing, sent by facsimile copy to the
Company at its address set forth above; and (ii) payment of the Purchase Price
of a minimum of $1,000 (unless the Purchase price for the exercise of all vested
options available to be exercised totals less than $1,000) pursuant to the terms
of this Grant of Option and the Company's Employee Benefit and Consulting
Services Compensation Plan. Any portion of this Grant of Option that is not
exercised on or before to the Expiration Date shall lapse. The notice must refer
to this Grant of Option, and it must specify the number of shares being
purchased, and recite the consideration being paid therefor. Notice shall be
deemed given on the date on which the notice is delivered to the Company by
facsimile transmission bearing an authorized signature of Optionee.
This Option shall be considered validly exercised once payment therefor
has cleared the banking system or the Company has issued a credit memo for
services in the appropriate amount, or receives a duly executed acceptable
promissory note, if the Option is granted with deferred payment, and the Company
has received written notice of such exercise.
If Optionee fails to exercise this Option in accordance with this
Agreement, then this Agreement shall terminate and have no force and effect, in
which event Optionor and Optionee shall have no liability to each other with
respect to this Grant of Option.
This Option may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
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GUINNESS STOCK OPTION PLAN (9/98) A-1
<PAGE> 8
The validity, construction and enforceability of this Grant of Option
shall be construed under and governed by the laws of the State of Nevada,
without regard to its rules concerning conflicts of laws, and any action brought
to enforce this Grant of Option or resolve any controversy, breach or
disagreement relative hereto shall be brought only in a court of competent
jurisdiction in the State of Nevada.
Unless otherwise set forth in a separate employment or consulting
agreement, the shares of stock issuable upon exercise of the Option (the
"Underlying Shares") are not subject to adjustment due to any changes in the
capital structure of the Company as set forth in Section 15 of the Plan.
Further, the Underlying Shares may not be sold, exchanged, assigned, transferred
or permitted to be transferred, whether voluntarily, involuntarily or by
operation of law, delivered, encumbered, discounted, pledged, hypothecated or
otherwise disposed of until (i) the Underlying Shares have been registered with
the Securities and Exchange Commission pursuant to an effective registration
statement on Form S-8, or such other form as may be appropriate, in the
discretion of the Company; or (ii) an Opinion of Counsel, satisfactory to the
Company, has been received, which opinion sets forth the basis and availability
of any exemption for resale or transfer from federal or state securities
registration requirements.
The Underlying Shares ___________________ [insert appropriate language:
"have" or "have not"] been registered with the Securities and Exchange
Commission pursuant to a registration statement on Form S-8.
This Grant of Option relates to options granted on____________________,
19___.
GUINNESS TELLI*PHONE CORPORATION
BY THE BOARD OF DIRECTORS
OR A SPECIAL COMMITTEE THEREOF
NOT FOR EXECUTION
By:
--------------------------------------
NOT FOR EXECUTION
By:
--------------------------------------
NOT FOR EXECUTION
By:
--------------------------------------
OPTIONEE:
NOT FOR EXECUTION
- -----------------------------------------
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GUINNESS STOCK OPTION PLAN (9/98) A-2
<PAGE> 9
GRANT OF OPTION PURSUANT TO THE GUINNESS TELLI*PHONE
CORPORATION STOCK OPTION PLAN, DATED SEPTEMBER 30, 1998.
OPTIONEE: -----------------------------
OPTIONS GRANTED: -----------------------------
PURCHASE PRICE: $ per Share
------
DATE OF GRANT: -----------------------------
EXERCISE PERIOD: to
------------ -----------
EXERCISED TO DATE: INCLUDING THIS EXERCISE
-------------
BALANCE TO BE EXERCISED:
-------------
FORM OF SUBSCRIPTION
(TO BE SIGNED ONLY UPON EXERCISE OF THE OPTION)
TO: Guinness Telli*Phone Corporation ("Optionor")
The undersigned, the holder of the Option described above, hereby
irrevocably elects to exercise the purchase rights represented by such Option
for, and to purchase thereunder, _________ shares of the Common Stock of
Guinness Telli*Phone Corporation, and herewith makes payment of _____________
therefor. Optionee requests that the certificates for such shares be issued in
the name of Optionee and be delivered to Optionee at the address of
_______________________________________________________________________________
_______________________________________________________________________________,
and if such shares shall not be all of the shares purchasable hereunder,
represents that a new Subscription of like tenor for the appropriate balance of
the shares, or a portion thereof, purchasable under the Grant of Option pursuant
to the Guinness Telli*Phone Corporation Stock Option Plan, be delivered to
Optionor when and as appropriate.
OPTIONEE:
NOT FOR EXECUTION
Dated:
------------------------- -------------------------------------------
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GUINNESS STOCK OPTION PLAN (9/98) A-3
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement of
Guinness Telli*Phone Corporation on Form S-8 of our report dated March 23, 1998,
relating to the consolidated financial statements of Guinness Telli*Phone
Corporation and Subsidiary appearing in the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1997.
/s/ BDO Seidman, LLP
San Francisco, California
September 30, 1998
