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As filed with the Securities and Exchange Commission on April 8, 1997.
Registration No. 33-______________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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Phoenix Gold International, Inc.
--------------------------------
(Exact name of registrant as specified in its charter)
Oregon 93-1066325
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9300 North Decatur Street
Portland, Oregon 97203
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(Address of principal executive offices) (Zip Code)
Amended and Restated 1995 Stock Option Plan
Matthew W. Chapman Nonstatutory Stock Option
Frank G. Magdlen Nonstatutory Stock Option
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(Full title of the plan)
Kurt W. Ruttum
Vice President and General Counsel
Phoenix Gold International, Inc.
9300 North Decatur Street
Portland, Oregon 97203
(503) 288-2008
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(Name, address and telephone number of agent for service)
CALCULATION OF REGISTRATION FEE
-------------------------------
Proposed Proposed
maximum maximum Amount
Title of Amount offering aggregate of
securities to be price per offering registration
to be registered share price fee
registered (1) (2) (3)
- ---------- ----------- ---------- --------- -------------
Common 210,000 $5.22 $1,096,300 $333
Stock, no shares
par value
- -----------------------------------
(1) This filing registers 200,000 shares of the Company's Common Stock reserved
for issuance under its Amended and Restated 1995 Stock Option Plan, 5,000 shares
of the Company's Common Stock reserved for issuance under the Matthew W. Chapman
<PAGE>
Nonstatutory Stock Option and 5,000 shares of the Company's Common Stock
reserved for issuance under the Frank G. Magdlen Nonstatutory Stock Option. The
Company previously registered 315,000 shares of the Company's Common Stock on
Form S-8 (Registration No. 33-98648) reserved for issuance under the Company's
1995 Stock Option Plan, which plan was amended and restated by the Company's
Board of Directors in July 1996 with such changes approved by the Company's
shareholders in February 1997.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) based upon (a) the actual price for 10,000 shares of the
Company's Common Stock subject to previously granted options (which are
exercisable at a price of $4.63 per share) and (b) the estimated proposed
maximum offering price of the remaining 200,000 shares reserved for issuance
based upon the average of the high and low prices of the Common Stock on April
2, 1997 as reported by The Nasdaq Stock Market, Inc. ($5.25 per share).
(3) Based upon the estimated proposed maximum aggregate offering price for the
210,000 shares of the Company's Common Stock registered hereunder.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents By Reference.
The following documents filed by Phoenix Gold International, Inc., an
Oregon corporation (the "Company"), with the Securities and Exchange Commission
(the "Commission") are incorporated by reference in this registration statement:
(a) The Company's annual report on Form 10-KSB for the fiscal year ended
September 30, 1996
(b) The Company's quarterly report on Form 10-QSB for the quarter ended
December 31, 1996.
(c) The description of the Company's common stock, no par value (the
"Common Stock"), as set forth in its registration statement on Form SB-2 as
declared effective by the Commission on May 3, 1995 (Registration No.
33-90588).
All documents filed by the Company subsequent to those listed above
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of filing of such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
None.
Item 6. Indemnification of Directors and Officers.
The Company has adopted provisions in its 1995 Restated Articles of
Incorporation ("Articles") and Restated Bylaws that limit the liability of its
directors to the fullest extent permitted by the Oregon Business Corporation
Act. Under the Company's Articles and Restated Bylaws, and as permitted by the
Oregon Business Corporation Act, no director is liable to the Company or its
shareholders for monetary damages for breaches of certain fiduciary duties as a
director of the Company. Such limitation of liability does not affect a
director's liability for a breach of the director's duty of loyalty to the
Company or its shareholders, an act or omission not in good faith or that
involves intentional misconduct or a knowing violation of the law, any unlawful
distributions, or a transaction from which the director receives an improper
personal benefit. Such limitation of liability also does not affect the
availability of equitable remedies such as injunctive relief or rescission.
<PAGE>
The Company's Articles permit and its Restated Bylaws require the
Company to indemnify its officers and directors to the fullest extent permitted
by law. The Company has entered into agreements to indemnify its directors and
executive officers to provide the maximum indemnification permitted by Oregon
law. These agreements, among other provisions, provide indemnification for
certain expenses (including attorney fees), judgments, fines and settlement
amounts incurred in any action or proceeding, including any action by or in the
right of the Company. The Company has obtained insurance covering its directors
and executive officers against certain liabilities, including liabilities under
federal and state securities laws. Insofar as indemnification for liabilities
arising under the Securities Act may be permitted to directors, officers and
controlling persons of the Company pursuant to the foregoing provisions, the
Company has been advised that, in the opinion of the Commission, such
indemnification is against public policy and is, therefore, unenforceable.
Item 7. Exemption From Registration Claimed
Not applicable.
Item 8. Exhibits.
The Index to Exhibits listing the exhibits required by Item 601 of
Regulation S-B is located on page II-4 of this registration statement.
Item 9. Undertakings.
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to:
(i) include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) reflect in the prospectus any facts or events which, individually
or together, represent a fundamental change in the information set
forth in the registration statement; and
(iii) include any additional or changed material information on the
plan of distribution;
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 undersigned
registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that
are incorporated by reference in this registration statement.
(2) For determining liability under the Securities Act, to treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of such securities at that time to be the initial
bona fide offering.
(3) To file a post-effective amendment to remove from registration any of
the securities offered that remain unsold at the end of the offering.
[Signatures on following page]
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the registrant certifies that it has reasonable grounds to believe that it meets
all 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 Portland, Oregon, on April 7, 1997.
PHOENIX GOLD INTERNATIONAL, INC.
By: /s/ Keith A. Peterson
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Keith A. Peterson
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature appears
below hereby constitutes and appoints Keith A. Peterson and Timothy G. Johnson,
and each of them, his true and lawful attorney-in-fact and agent, with full
power of substitution for him in any and all capacities, to sign any and all
amendments or post-effective amendments to this registration statement, and to
file the same, with all exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto such
attorney and agent full power and authority to do any and all acts and things
necessary or advisable in connection with such matters, and hereby ratifying and
confirming all that the attorney and agent, or his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and on the date(s) indicated:
NAME AND POSITION: DATE:
/s/ Keith A. Peterson April 7, 1997
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Keith A. Peterson
Chairman, President, Chief Executive Officer
and Director (Principal Executive Officer)
/s/ Timothy G. Johnson April 7, 1997
- -------------------------------
Timothy G. Johnson
Executive Vice President, Chief Operating
Officer and Director
/s/ Joseph K. O'Brien April 7, 1997
- --------------------------------
Joseph K. O'Brien
Chief Financial Officer (Principal Financial
and Accounting Officer)
/s/ Frank G. Magdlen April 7, 1997
- --------------------------------
Frank G. Magdlen
Director
/s/ Matthew W. Chapman April 7, 1997
- --------------------------------
Matthew W. Chapman
Director
<PAGE>
INDEX TO EXHIBITS
EXHIBIT EXHIBIT PAGE
NUMBER
4.1 Registrant's 1995 Restated Articles of Incorporation
and Articles of Amendment (Incorporated by reference
to Exhibit 3(i) of the Company's Registration Statement
on Form SB-2 as declared effective on May 3, 1995
(Registration No.33-90588)
4.2 Registrant's Restated Bylaws (Incorporated by
reference to Exhibit 3(ii) of the Company's
Registration Statement on Form SB-2 as declared
effective on May 3, 1995 (Registration No. 33-90588)
5 Opinion of Tonkon, Torp, Galen, Marmaduke & Booth 7
23.1 Consent of Deloitte & Touche LLP, Independent Auditors 8
23.2 Consent of Tonkon, Torp, Galen, Marmaduke & Booth
(included in Exhibit 5)
24 Power of Attorney (See Page II-4)
99.1 Amended and Restated 1995 Stock Option Plan 9
dated January 27, 1995
99.2 Matthew W. Chapman Nonstatutory Stock Option Agreement 17
99.3 Frank G. Magdlen Nonstatutory Stock Option Agreement 20
Exhibit 5
TONKON, TORP, GALEN, MARMADUKE & BOOTH
ATTORNEYS AT LAW
1600 PIONEER TOWER
888 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204-2099
(503) 221-1440
FAX (503) 274-8779
April 4, 1997
To the Board of Directors
of Phoenix Gold International, Inc.
Ladies and Gentlemen:
We have acted as counsel for Phoenix Gold International, Inc. (the
"Company") in connection with the preparation and filing of a Registration
Statement on Form S-8 under the Securities Act of 1933, covering a proposed
210,000 shares of the Company's Common Stock, no par value (the "Shares"). We
have reviewed the corporate action of the Company in connection with this matter
and have examined and relied upon such documents, corporate records and other
evidence as we have deemed necessary for the purpose of this opinion.
Based on the foregoing, it is our opinion that the Shares have been duly
authorized and, when issued and sold pursuant to the governing Stock Option
Agreements, the Shares will be legally issued, fully paid and nonassessable. We
hereby consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ Tonkon, Torp, Galen,
Marmaduke & Booth
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Phoenix Gold International, Inc. on Form S-8 of our report dated December 27,
1996, appearing in the Annual Report on Form 10-KSB of Phoenix Gold
International, Inc. for the year ended September 30, 1996.
/s/ Deloitte & Touche LLP
Portland, Oregon
April 7, 1997
Exhibit 99.1
PHOENIX GOLD INTERNATIONAL, INC.
(FORMERLY, JISHUDOKURITSU, INC.)
AMENDED AND RESTATED 1995 STOCK OPTION PLAN
I. PURPOSE
The purpose of the Plan is to provide a means by which selected
Employees, Nonemployee Directors and Consultants may be given an opportunity to
acquire stock of the Company. The Company, by means of the Plan, seeks to retain
the services of persons who are currently Employees, Nonemployee Directors or
Consultants, to secure and retain the services of new Employees, Nonemployee
Directors and Consultants, and to provide incentives for such persons to exert
maximum efforts for the success of the Company. Accordingly, the Plan provides
for granting Incentive Stock Options, Nonstatutory Stock Options and Restricted
Stock Awards, or any combination of the foregoing, as is best suited to the
circumstances of the particular person as provided herein.
II. DEFINITIONS
The following definitions shall be applicable throughout the
Plan unless specifically modified by any paragraph:
1. "1934 ACT" means the Securities Exchange Act of 1934, as amended
and in effect from time to time, or any successor statute.
2. "AWARD" means, individually or collectively, any Option, Restricted
Stock Award or Nonemployee Director Option.
3. BOARD" means the Board of Directors of the Company.
4. "CODE" means the Internal Revenue Code of 1986, as amended and in
effect from time to time, or any successor statute. Reference in the Plan to any
section of the Code shall be deemed to include any amendments or successor
provisions to any such section.
5. "COMMITTEE" means not less than two members of the Board who are
selected by the Board as provided in Paragraph A of Article IV.
6. "COMMON STOCK" means the Common Stock, without par value, of the
Company.
7. "COMPANY" means Phoenix Gold International, Inc., an Oregon
corporation.
8. "CONSULTANT" means any person, including an adviser, engaged by the
Company to render services and who does not render such services as an Employee
or Nonemployee Director.
9. "DIRECTOR" means an individual elected to the Board by the
shareholders of the Company or by the Board under applicable corporate law who
is serving on the Board on the date the Plan is adopted by the Board or is
elected to the Board after such date.
10. "DISABILITY" means the condition of being permanently "disabled"
within the meaning of Section 22(e)(3) of the Code, namely being unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than 12 months.
11. "EMPLOYEE" means any person (including a Director) in an employment
relationship with the Company.
<PAGE>
l2. "FAIR MARKET VALUE" means, as of any specified date, the reported
closing sale price of the Common Stock on the composite tape on that date, or if
no such price is reported on that date, on the last preceding date on which such
price of the Common Stock is so reported. If the Common Stock is traded over the
counter at the time a determination of its fair market value is required to be
made hereunder, its fair market value shall be deemed to be equal to the closing
sale price of Common Stock on that date, or if no such price is reported on that
date, on the last preceding date on which such price of Common Stock is so
reported. In the event Common Stock is not publicly traded at the time a
determination of its value is required to be made hereunder, the determination
of its fair market value shall be made by the Committee in such manner as it
deems appropriate.
13. "HOLDER" means an Employee, Consultant or a Nonemployee Director
who has been granted an Award.
14. "INCENTIVE STOCK OPTION" means an incentive stock option within the
meaning of Section 422 of the Code.
15. "NONEMPLOYEE DIRECTOR" means a Nonemployee Director as defined in
Rule 16b-3, as such Rule may be amended from time to time.
16. "NONEMPLOYEE DIRECTOR OPTION" means an Award described in Article
IX of the Plan.
17. "NONEMPLOYEE DIRECTOR OPTION AGREEMENT" means a written agreement
between the Company and a Holder with respect to a Nonemployee Director Option.
18. "NONSTATUTORY STOCK OPTION" means a stock option other than an
Incentive Stock Option.
19. "OPTION" means an Award described in Article VII of the Plan.
20. "OPTION AGREEMENT" means a written agreement between the Company
and a Holder with respect to an Option.
21. "PARENT" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
22. "PLAN" means the Amended and Restated 1995 Stock Option Plan of
the Company, as set forth herein and as may be hereafter amended from time to
time.
23. "RESTRICTED STOCK AGREEMENT" means a written agreement between the
Company and a Holder with respect to a Restricted Stock Award.
24. "RESTRICTED STOCK AWARD" means an Award described in Article VIII
of the Plan.
25. "RULE 16B-3" means Rule 16b-3 promulgated by the Securities and
Exchange Commission under the 1934 Act, as such may be amended from time to
time, and any successor rule, regulation or statute fulfilling the same or
similar function.
26. "SUBSIDIARY" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code; namely, any
corporation in which the Company directly or indirectly controls 50 percent or
more of the total combined voting power of all classes of stock having voting
power.
<PAGE>
III. EFFECTIVE DATE AND DURATION
OF THE PLAN
The Plan shall be effective as of January 27, 1995, the date of its
adoption by the Board and the shareholders of the Company. No further Awards may
be granted under the Plan after January 26, 2005. The Plan shall remain in
effect until all Awards granted under the Plan have been satisfied or expired.
IV. ADMINISTRATION
A. COMPOSITION OF COMMITTEE. The Plan shall be administered by a
committee which shall (i) be appointed by the Board and (ii) consist of
Nonemployee Directors.
B. AUTHORITY OF THE COMMITTEE. Subject to the provisions of the Plan,
the Committee shall have sole authority, in its discretion, to determine (i)
which Employees, Nonemployee Directors and Consultants shall receive Awards,
(ii) the time or times when Awards shall be granted, (iii) the type or types of
Awards to be granted, and (iv) the number of shares of Common Stock which may be
issued under each Award. In making such determinations the Committee may take
into account the nature of the services rendered by the respective individuals,
their present and potential contribution to the success of the Company, and such
other factors as the Committee in its discretion shall deem relevant. The
Committee shall also have such additional powers as are delegated to it by the
Plan. Subject to the express provisions of the Plan, the Committee is authorized
to construe the Plan and the respective agreements executed thereunder, to
prescribe such rules and regulations relating to the Plan as it may deem
advisable to carry out the Plan, and to determine the terms, restrictions and
provisions of each Award, including such terms, restrictions and provisions as
shall be requisite in the judgment of the Committee to cause designated Options
to qualify as Incentive Stock Options, and to make all other determinations
necessary or advisable for administering the Plan. The Committee may correct any
defect or supply any omission or reconcile any inconsistency in any agreement
relating to an Award in the manner and to the extent it shall deem expedient to
carry it into effect. The determinations of the Committee on the matters
referred to in this Article IV shall be conclusive.
C. LIABILITY OF COMMITTEE MEMBERS. No member of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any Award.
D. COSTS OF PLAN. The costs and expenses of administering the Plan
shall be borne by the Company.
V. ELIGIBILITY
Employees, Nonemployee Directors and Consultants are eligible
to receive Options and Restricted Stock Awards; provided, however, only
Employees are eligible to receive Incentive Stock Options. Only Nonemployee
Directors are eligible to receive Nonemployee Director Options. Any Award may be
granted on more than one occasion to the same person, and may include an
Incentive Stock Option, a Nonstatutory Stock Option, a Restricted Stock Award,
or any combination thereof. No employee may be granted options or Restated Stock
Awards under the Plan for more than an aggregate of 100,000 shares of Common
Stock in connection with the hiring of the employee or 50,000 shares of Common
Stock in any calendar year otherwise.
<PAGE>
VI. SHARES SUBJECT TO THE PLAN
A. AGGREGATE NUMBER OF SHARES. Subject to Article X, the aggregate
number of shares of Common Stock that may be issued under the Plan shall not
exceed 515,000 shares, after giving effect to a 109-to-one stock split declared
by the Board on January 27, 1995. Shares shall be deemed to have been issued
under the Plan only (i) to the extent actually issued and delivered pursuant to
an Award, or (ii) to the extent an Award is settled in cash. To the extent that
an Award lapses or the rights of its Holder terminate, any shares of Common
Stock subject to such Award shall again be available for the grant of an Award.
B. STOCK OFFERED. The stock to be offered pursuant to the grant of any
Award may be authorized but unissued Common Stock or Common Stock previously
issued and outstanding and reacquired by the Company.
VII. OPTIONS
A OPTION PERIOD. The term of each Option shall be as specified by the
Committee at the date of grant, except that no Incentive Stock Option shall be
exercisable after the expiration of ten years from the date of grant of such
Incentive Stock Option.
B. LIMITATIONS ON EXERCISE OF OPTION. An Option shall be exercisable
in whole or in such installments and at such times as determined by the
Committee.
C. SPECIAL LIMITATIONS ON INCENTIVE STOCK OPTIONS. To the extent that the
aggregate Fair Market Value (determined at the time the respective Incentive
Stock Option is granted) of Common Stock with respect to which Incentive Stock
Options granted are exercisable for the first time by an individual during any
calendar year under all incentive stock option plans of the Company exceeds
$100,000, such Incentive Stock Options shall be treated as options which do not
constitute Incentive Stock Options. The Committee shall determine, in accordance
with applicable provisions of the Code, Treasury Regulations and other
administrative pronouncements, which of a Holder's Options will not constitute
Incentive Stock Options because of such limitation and shall notify the Holder
of such determination as soon as practicable after such determination. No
Incentive Stock Option shall be granted to an individual if, at the time the
Option is granted, such individual owns stock possessing more than 10 percent of
the total combined voting power of all classes of stock of the Company, unless
(i) at the time such Option is granted the exercise price is at least 110
percent of the Fair Market Value of the Common Stock subject to the Option and
(ii) such Option by its terms is not exercisable after the expiration of five
years from the date of grant.
D. SEPARATE STOCK CERTIFICATES. Separate stock certificates shall be
issued by the Company for those shares acquired pursuant to the exercise of an
Incentive Stock Option and for those shares acquired pursuant to the exercise of
a Nonstatutory Stock Option.
E. OPTION AGREEMENT. Each Option shall be evidenced by an Option
Agreement in such form and containing such provisions not inconsistent with the
provisions of the Plan as the Committee from time to time shall approve,
including, without limitation, provisions to qualify an Incentive Stock Option
under Section 422 of the Code. An Option Agreement may provide for the payment
of the exercise price, in whole or in part, by the delivery of a number of
shares of Common Stock (plus cash if necessary) having a Fair Market Value (as
of the exercise date of the Option) equal to such exercise price. Moreover, an
Option Agreement may provide for a "cashless exercise" of the Option by
establishing procedures whereby the Holder, by a properly executed written
notice, directs (i) an immediate market sale or margin loan respecting all or a
part of the shares of Common Stock to which the Holder is entitled upon exercise
of the Option, (ii) the delivery of the shares of Common Stock from the Company
directly to a brokerage firm and (iii) the delivery of the exercise price from
sale or margin loan proceeds from the brokerage firm directly to the Company.
Such Option Agreement may also include, without limitation, provisions relating
to (a) vesting of Options, (b) tax matters (including provisions covering any
applicable employee wage withholding requirements), and (c) any other matters
not inconsistent with the terms and provisions of this Plan that the Committee
shall in its sole discretion determine. The terms and conditions of the
respective Option Agreements need not be identical.
<PAGE>
F. EXERCISE PRICE AND PAYMENT. The price at which a share of Common
Stock may be purchased upon exercise of an Option shall be determined by the
Committee, but such exercise price (i) shall not be less than the Fair Market
Value of a share of Common Stock on the date such Option is granted if the
Option is an Incentive Stock Option and (ii) shall be subject to adjustment as
provided in Article X. An Option or portion thereof may be exercised by delivery
of an irrevocable notice of exercise to the Company. The exercise price of an
Option or portion thereof shall be paid in full in the manner prescribed by the
Committee.
G. TERMINATION OF EMPLOYMENT OR SERVICE.
1. In the event the employment or service of a Holder of an
Option by the Company terminates for any reason other than because of
Disability or death, such Option may be exercised at any time prior to
the expiration date of the Option or the expiration of three months
after the date of such termination, whichever is the shorter period,
but only if and to the extent the Holder was entitled to exercise the
Option at the date of such termination.
2. In the event the employment or service of a Holder of an
Option by the Company terminates because of Disability, such Option
may be exercised at any time prior to the expiration date of the
Option or the expiration of one year after the date of such
termination, whichever is the shorter period, but only if and to the
extent the Holder was entitled to exercise the Option at the date of
such termination.
3. In the event of the death of a Holder of an Option while
employed by or providing service to the Company, such Option may be
exercised at any time prior to the expiration date of the Option or
the expiration of one year after the date of such death, whichever is
the shorter period, but only if and to the extent the Holder was
entitled to exercise the Option on the date of death, and only by the
person or persons to whom such Holder's rights under the Option shall
pass by the Holder's will or by the laws of descent and distribution
of the state or country of domicile at the time of death.
4. The Committee, at the time of grant or at any time thereafter,
may extend the three-month and one-year expiration periods any length
of time not later than the original expiration date of the Option, and
may increase the portion of the Option that is exercisable, subject to
such terms and conditions as the Committee may determine.
5. To the extent that the Option of any deceased Holder or of any
Holder whose employment or service terminates is not exercised within
the applicable period, all further rights to purchase Common Stock
pursuant to such Option shall cease and terminate.
H. RIGHTS AS A SHAREHOLDER. The Holder of an Option under the Plan
shall have no rights as a shareholder with respect to the Common Stock subject
to such Option until the date of issue to the Holder of a stock certificate for
such shares. Except as otherwise expressly provided in the Plan, no adjustment
shall be made for dividends or other rights for which the record date occurs
prior to the date such stock certificate is issued.
I. OPTIONS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY OTHER
CORPORATIONS. Options may be granted under the Plan from time to time in
substitution for stock options held by individuals employed by corporations who
become Employees as a result of a merger or consolidation of the employing
corporation with the Company, or the acquisition by the Company of the assets of
the employing corporation, or the acquisition by the Company of stock of the
employing corporation with the result that such employing corporation becomes a
Subsidiary.
<PAGE>
VIII. RESTRICTED STOCK AWARDS
A. RESTRICTION PERIOD. At the time a Restricted Stock Award is
granted, the Committee shall establish a period of time (the "Restriction
Period") applicable to such Award. Each Restricted Stock Award may have a
different Restriction Period, in the discretion of the Committee. The
Restriction Period applicable to a particular Restricted Stock Award shall not
be changed except as permitted by Paragraph B of this Article VIII or Article X.
B. OTHER TERMS AND CONDITIONS. Common Stock awarded pursuant to a
Restricted Stock Award shall be represented by a stock certificate registered in
the name of the Holder of such Restricted Stock Award. The Holder shall have the
right to receive dividends during the Restriction Period, to vote Common Stock
subject thereto and to enjoy all other shareholder rights, except that (i) the
Holder shall not be entitled to delivery of the stock certificate until the
Restriction Period shall have expired, (ii) the Company shall retain custody of
the stock certificate during the Restriction Period, (iii) the Holder may not
sell, transfer, pledge, exchange, hypothecate or otherwise dispose of the stock
during the Restriction Period, and (iv) a breach of the terms and conditions
established by the Committee pursuant to the Restricted Stock Agreement shall
cause a forfeiture of the Restricted Stock Award. Stock dividends issued with
respect to Common Stock awarded pursuant to a Restricted Stock Award shall be
treated as additional Common Stock covered by the Restricted Stock Award. At the
time of such Award, the Committee may, in its sole discretion, prescribe
additional terms, conditions or restrictions relating to Restricted Stock
Awards, including, but not limited to, rules pertaining to the termination of
employment or service (by retirement, Disability, death or otherwise) of a
Holder prior to expiration of the Restriction Period. Such additional terms,
conditions or restrictions shall be set forth in a Restricted Stock Agreement
made in conjunction with the Award. Such Restricted Stock Agreement may also
include, without limitation, provisions relating to (i) vesting of Awards, (ii)
tax matters (including provisions (x) covering any applicable employee wage
withholding requirements and (y) prohibiting an election by the Holder under
Section 83(b) of the Code), and (iii) any other matters not inconsistent with
the terms and provisions of this Plan that the Committee shall in its sole
discretion determine.
C. EXERCISE PRICE AND PAYMENT. The Committee shall determine the
amount and form of any payment for Common Stock received pursuant to a
Restricted Stock Award, provided that in the absence of such a determination, a
Holder shall not be required to make any payment for Common Stock received
pursuant to a Restricted Stock Award, except to the extent otherwise required by
law.
D. RESTRICTED STOCK AGREEMENT. At the time any Award is granted under
this Article VIII, the Company and the Holder shall enter into a Restricted
Stock Agreement setting forth each of the matters contemplated hereby and such
other matters as the Committee may determine to be appropriate. The terms and
provisions of the respective Restricted Stock Agreements need not be identical.
IX. NONEMPLOYEE DIRECTOR OPTIONS
A. EXERCISE PRICE. The price at which a share of Common Stock may be
purchased upon exercise of a Nonemployee Director Option shall be the Fair
Market Value of a share of Common Stock on the date such Nonemployee Director
Option is granted.
B. TERM AND LIMITATIONS ON EXERCISE. Each Nonemployee Director Option
shall be a Nonstatutory Stock Option and shall have a five-year term from the
date of grant, unless earlier terminated as provided in Paragraph G of Article
VII or Article X. Each Nonemployee Director Option shall become exercisable at
the rate of one-third per year on each of the first three anniversaries of the
date of grant, subject to earlier exercise pursuant to Article X. If a Holder
ceases to be a Director for any reason, including death or Disability, the
exercise of the Option shall be subject to Paragraph G of Article VII.
C. GENERAL RULES. Nonemployee Director Options shall be governed by
the provisions of Article VII to the extent such provisions are not inconsistent
with this Article IX. Each Nonemployee Director Option shall be evidenced by a
Nonemployee Director Option Agreement.
D. AUTOMATIC GRANTS. Immediately after the close of each shareholder
meeting at which a Nonemployee Director is first elected to the Board, such
Nonemployee Director shall automatically be granted a Nonemployee Director
Option to purchase 5,775 shares of Common Stock. Immediately after the close of
each shareholder meeting thereafter at which such Nonemployee Director is
re-elected to the Board, such Nonemployee Director shall automatically be
granted a Nonemployee Director Option to purchase 1,400 shares of Common Stock.
Notwithstanding the foregoing, no Nonemployee Director shall be granted
Nonemployee Director Options covering, in the aggregate, more than 8,575 shares
of Common Stock.
<PAGE>
X. CHANGES IN CAPITAL STRUCTURE
A. If the outstanding Common Stock is hereafter increased or decreased
or changed into or exchanged for a different number or kind of shares or other
securities of the Company or of another corporation by reason of any
reorganization, merger, consolidation, plan of exchange, recapitalization,
reclassification, stock split-up, combination of shares or dividend payable in
shares, appropriate adjustment shall be made by the Committee in the number and
kind of shares available for Awards. In addition, the Committee shall make
appropriate adjustment in the number and kind of shares as to which outstanding
Options, or portions thereof then unexercised, shall be exercisable, the option
price of outstanding Options and any and all other matters deemed appropriate by
the Committee, so that the Holder's proportionate interest and economic value
before and after the occurrence of the event is maintained. Notwithstanding the
foregoing, the Committee shall have no obligation to effect any adjustment that
would or might result in the issuance of fractional shares, and any fractional
shares resulting from any adjustment may be disregarded or provided for in any
manner determined by the Committee. Any such adjustments made by the Committee
shall be conclusive. Any adjustment provided for in this Paragraph A of Article
X shall be subject to any required shareholder action. In the event of
dissolution of the Company or a merger, consolidation or plan of exchange
affecting the Company, in lieu of providing for Options as provided above in
this Paragraph A of Article X or in lieu of having the Options continue
unchanged, the Committee may, in its sole discretion, provide a 30-day period
prior to such event during which Holders shall have the right to exercise
Options in whole or in part without any limitation on exercisability and upon
the expiration of which 30-day period all unexercised Options shall immediately
terminate.
B. The existence of the Plan and the Awards granted hereunder shall
not affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of debt or equity securities ahead of or
affecting Common Stock or the rights thereof, the dissolution or liquidation of
the Company, or any sale, lease, exchange or other disposition of all or any
part of its assets or business or any other corporate act or proceeding.
C. Except as hereinbefore expressly provided, the issuance by the
Company of shares of stock of any class or securities convertible into shares of
stock of any class, for cash, property, labor or services, upon direct sale,
upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, and in any case whether or not for fair value, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
number of shares of Common Stock subject to Awards theretofore granted or the
exercise price per share, if applicable.
XI. AMENDMENT AND TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with respect to
any shares for which Awards have not theretofore been granted. The Board shall
have the right to alter or amend the Plan or any part thereof from time to time;
provided, that no change in any Award theretofore granted may be made which
would impair the rights of the Holder without the consent of the Holder;
provided further, that the provisions of Article IX shall not be amended more
than once during any period of six calendar months, other than to comport with
changes in the Code, the Employee Retirement Income Security Act of 1974, as
amended, or the rules thereunder; and provided further, that the Board may not,
without approval of the shareholders, amend the Plan:
(a) to increase the maximum number of shares which may be issued
on grant or exercise of an Award, except as provided in Article X;
(b) to change the price at which an Award may be granted or
exercised, except as provided in Article X;
(c) to change the class of individuals eligible to receive
Awards; or
(d) to extend the maximum period during which Awards may be
granted under the Plan.
<PAGE>
XII. MISCELLANEOUS
A. NO RIGHT TO AN AWARD. Neither the adoption of the Plan by the
Company nor any action of the Board or the Committee shall be deemed to give an
Employee, a Consultant or a Nonemployee Director any right to be granted an
Award or any of the rights hereunder except as may be evidenced by an Award or
by an Option Agreement, Restricted Stock Agreement or Nonemployee Director
Option Agreement duly executed on behalf of the Company, and then only to the
extent and on the terms and conditions expressly set forth therein.
B. NO EMPLOYMENT RIGHTS CONFERRED. Nothing in the Plan shall (i)
confer upon any Employee any right with respect to continuation of employment
with the Company or (ii) interfere in any way with the right of the Company to
terminate the Employee's employment (or service as a Director, in accordance
with applicable corporate law, or service as a Consultant) at any time for any
reason, with or without cause.
C. OTHER LAWS; WITHHOLDING. The Company shall not be obligated to
issue any Common Stock pursuant to any Award granted under the Plan at any time
when the shares covered by such Award have not been registered under the
Securities Act of 1933, as amended, and such other state and federal laws, rules
or regulations as the Company or the Committee deems applicable and, in the
opinion of legal counsel for the Company, there is no exemption from the
registration requirements of such laws, rules or regulations available for the
issuance and sale of such shares. No fractional shares of Common Stock shall be
delivered, nor shall any cash in lieu of fractional shares be paid. The Company
shall have the right to deduct in connection with all Awards any taxes required
by law to be withheld and to require any payments required to enable it to
satisfy its withholding obligations.
D. NO RESTRICTION ON CORPORATE ACTION. Nothing contained in the Plan shall be
construed to prevent the Company from taking any corporate action which is
deemed by the Company to be appropriate or in its best interest, whether or not
such action would have an adverse effect on the Plan or any Award granted under
the Plan. No Employee, Consultant, Director, beneficiary or other person shall
have any claim against the Company as a result of any such action.
E. RESTRICTIONS ON TRANSFER. An Award shall not be transferable
otherwise than by will or the laws of descent and distribution; provided,
however, that with the consent of the Committee, Nonstatutory Stock Options may
be assigned or transferred pursuant to a qualified domestic relations order (a
"QDRO") as defined by the Code or Title I of the Employee Retirement Income
Security Act of 1974, as amended, or the rules thereunder. An Award may be
exercisable during the lifetime of the Holder only by such Holder, the Holder's
guardian or legal representative or the Holder's permitted assignee or
transferee under a QDRO.
F. GOVERNING LAW. To the extent that federal laws (such as the Code
and the federal securities laws) do not otherwise control, the Plan shall be
construed in accordance with the laws of the state of Oregon.
G. HEADINGS. Headings contained in the Plan are for reference purposes
and shall not affect the meaning or interpretation of the Plan.
Exhibit 99.2
PHOENIX GOLD INTERNATIONAL, INC.
GRANT NO. NSO-10
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of February 18, 1997 between PHOENIX
GOLD INTERNATIONAL, INC., an Oregon corporation (the "Company"), and MATTHEW W.
CHAPMAN the ("Optionee").
Optionee has been granted a nonstatutory stock option to purchase
shares of the Company's Common Stock, without par value per share (the "Common
Stock"), in the amount indicated below. This Option is granted outside of the
Company's Amended and Restated 1995 Stock Option Plan (the "Plan"). Nonetheless,
certain of the terms and conditions of the Plan are incorporated into this
Option Agreement by reference.
NOW, THEREFORE, in consideration of the promises and the
mutual covenants contained in this Option Agreement, the parties agree as
follows:
1. GRANT. The Company grants to Optionee, upon the terms and
conditions set forth below, the right and option (the "Option") to purchase
5,000 shares of Common Stock at an exercise price of $4.63 per share (the
"Exercise Price"). The Option is a Nonstatutory Stock Option and is not intended
to qualify as an Incentive Stock Option under Section 422 of the Code.
2. TERM OF OPTION. Subject to reductions in the term of the
Option as provided in this Option Agreement, the Option shall continue in effect
until February 18, 2002, and may be exercised during such term only in
accordance with the provisions of the Plan and this Option Agreement.
3. VESTING SCHEDULE. The Option may be exercised, in whole or
in part, in accordance with the following schedule: (a) on the first anniversary
of the date hereof, one-third of the shares purchasable under the Option may be
purchased at any time thereafter until the Option expires; and (b) continuing on
each of the second and third anniversaries of the date hereof, an additional
one-third of the shares purchasable under the Option may be purchased at any
time thereafter until the Option expires.
4. EXERCISE OF OPTION.
A. RIGHT TO EXERCISE. The Option is exercisable during its
term in accordance with the vesting schedule set forth above in Section 3 and
the applicable provisions of this Option Agreement. In the event that the
Optionee's service with the Company terminates during the term of the Option,
the exercisability of the Option shall be governed by the applicable provisions
of the Plan, as if the Option had been granted under the Plan, and this Option
Agreement.
B. METHOD OF EXERCISE. The Option is exercisable by delivery
of an exercise notice, which notice shall state the election to exercise the
Option, the number of shares of Common Stock in respect of which the Option is
being exercised (the "Exercised Shares"), and such other representations and
agreements as may be required by the Company pursuant to the provisions of the
Plan. In addition, Optionee agrees to execute, as a condition of Option
exercise, such agreements respecting the Exercised Shares as the Committee, in
its reasonable discretion, determines to be required under the terms of
agreements to which the Company is a party or otherwise advisable and in the
best interests of the Company. The exercise notice shall be signed by Optionee
and shall be delivered in person or by certified mail to the Secretary of the
Company. The exercise notice shall be accompanied by payment of the aggregate
Exercise Price as to all the Exercised Shares. The Option shall be deemed to be
exercised upon receipt by the Company of such fully executed exercise notice
accompanied by such aggregate Exercise Price. For income tax purposes the
Exercised Shares shall be considered transferred to Optionee on the date the
Option is exercised with respect to such Exercised Shares.
<PAGE>
5. CONDITIONS. The obligations of the Company under this Option
Agreement shall be subject to the approval of such state or federal authorities
or agencies as may have jurisdiction in the matter. The Company will use its
best efforts to take such steps as may be required by state or federal law or
applicable regulations, including rules and regulations of the Securities and
Exchange Commission and any national securities exchange on which the Common
Stock may then be listed, in connection with the issuance or sale of any shares
acquired pursuant to this Option Agreement or the listing of such shares on any
such exchange. The Company shall not be obligated to issue or deliver shares of
Common Stock under this Option Agreement if, upon advice of its legal counsel,
such issuance or delivery would violate state or federal securities laws.
6. METHOD OF PAYMENT. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election of
Optionee:
(i) cash; or
(ii) check; or
(iii) delivery of such documentation as the Committee and
Optionee's broker shall require to effect an exercise of the
Option and delivery to the Company of the sale or margin
loan proceeds required to pay the aggregate Exercise Price
of the Exercised Shares; or
(iv) surrender of other shares of Common Stock which have a Fair
Market Value on the date of surrender equal to the aggregate
Exercise Price of the Exercised Shares.
7. RESTRICTION ON TRANSFER. The Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution or,
with the consent of the Committee, pursuant to a qualified domestic relations
order (a "QDRO") as defined by the Code or Title I of the Employee Retirement
Income Security Act of 1974, as amended, and may be exercised during the
lifetime of Optionee only by Optionee or Optionee's guardian or legal
representative or Optionee's permitted assignee or transferee pursuant to a
QDRO. The terms of the Plan and this Option Agreement shall be binding upon the
executors, administrators, heirs, successors and permitted assigns of Optionee.
<PAGE>
8. LEGENDS. All certificates representing any of the shares of
Common Stock subject to the provisions of this Option Agreement may, in the sole
discretion of the Committee, have endorsed thereon the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED."
(b) Any legend required to be placed thereon by applicable
Blue Sky laws of any state.
(c) Any legend required to be placed thereon by any
applicable shareholder agreement.
9. EMPLOYMENT; SERVICE. Nothing in the Plan or in this Option
Agreement shall (a) confer upon the Optionee any right with respect to
employment with the Company or any affiliate of the Company or (ii) interfere in
any way with the right of the Company or any affiliate of the Company to
terminate the Optionee's employment (or service as a Director, in accordance
with applicable corporate law, or service as a Consultant) at any time for any
reason, with or without cause.
10. THE PLAN. Although the Option has been granted outside of the
Plan, the parties desire that the Option be subject to the terms and conditions
of the Plan as if it had been granted under the Plan.
11. DEFINITIONS. Any capitalized term in this Option Agreement
which is not defined herein and which is defined in the Plan shall have the same
definition as in the Plan.
12. GOVERNING LAW. To the extent that federal laws (such as the
Code and the federal securities laws) do not otherwise control, the Plan and
this Option Agreement shall be construed in accordance with the laws of the
state of Oregon.
13. HEADINGS. Headings contained in this Option Agreement are for
reference purposes and shall not affect the meaning or interpretation of this
Option Agreement.
Optionee and the Company agree that the Option is granted under
and governed by the terms and conditions of the Plan and this Option Agreement.
Optionee has reviewed the Plan and this Option Agreement in their entirety, has
had an opportunity to obtain the advice of counsel prior to executing this
Option Agreement and fully understands all provisions of the Plan and Option
Agreement. Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Committee upon any questions relating to the
Plan and Option Agreement.
OPTIONEE: PHOENIX GOLD INTERNATIONAL, INC.
/s/ Matthew W. Chapman By: /s/ Kurt W. Ruttum
- ---------------------------- --------------------------------
Signature Kurt W. Ruttum
Vice President and General
Counsel
MATTHEW W. CHAPMAN
- ----------------------------
Print Name
- ----------------------------
Social Security Number
Exhibit 99.3
PHOENIX GOLD INTERNATIONAL, INC.
GRANT NO. NSO-9
NONSTATUTORY STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of February 18, 1997 between PHOENIX
GOLD INTERNATIONAL, INC., an Oregon corporation (the "Company"), and FRANK G.
MAGDLEN the ("Optionee").
Optionee has been granted a nonstatutory stock option to purchase
shares of the Company's Common Stock, without par value per share (the "Common
Stock"), in the amount indicated below. This Option is granted outside of the
Company's Amended and Restated 1995 Stock Option Plan (the "Plan"). Nonetheless,
certain of the terms and conditions of the Plan are incorporated into this
Option Agreement by reference.
NOW, THEREFORE, in consideration of the promises and the
mutual covenants contained in this Option Agreement, the parties agree as
follows:
1. GRANT. The Company grants to Optionee, upon the terms and
conditions set forth below, the right and option (the "Option") to purchase
5,000 shares of Common Stock at an exercise price of $4.63 per share (the
"Exercise Price"). The Option is a Nonstatutory Stock Option and is not intended
to qualify as an Incentive Stock Option under Section 422 of the Code.
2. TERM OF OPTION. Subject to reductions in the term of the
Option as provided in this Option Agreement, the Option shall continue in effect
until February 18, 2002, and may be exercised during such term only in
accordance with the provisions of the Plan and this Option Agreement.
3. VESTING SCHEDULE. The Option may be exercised, in whole or
in part, in accordance with the following schedule: (a) on the first anniversary
of the date hereof, one-third of the shares purchasable under the Option may be
purchased at any time thereafter until the Option expires; and (b) continuing on
each of the second and third anniversaries of the date hereof, an additional
one-third of the shares purchasable under the Option may be purchased at any
time thereafter until the Option expires.
4. EXERCISE OF OPTION.
A. RIGHT TO EXERCISE. The Option is exercisable during its
term in accordance with the vesting schedule set forth above in Section 3 and
the applicable provisions of this Option Agreement. In the event that the
Optionee's service with the Company terminates during the term of the Option,
the exercisability of the Option shall be governed by the applicable provisions
of the Plan, as if the Option had been granted under the Plan, and this Option
Agreement.
B. METHOD OF EXERCISE. The Option is exercisable by delivery
of an exercise notice, which notice shall state the election to exercise the
Option, the number of shares of Common Stock in respect of which the Option is
being exercised (the "Exercised Shares"), and such other representations and
agreements as may be required by the Company pursuant to the provisions of the
Plan. In addition, Optionee agrees to execute, as a condition of Option
exercise, such agreements respecting the Exercised Shares as the Committee, in
its reasonable discretion, determines to be required under the terms of
agreements to which the Company is a party or otherwise advisable and in the
best interests of the Company. The exercise notice shall be signed by Optionee
and shall be delivered in person or by certified mail to the Secretary of the
Company. The exercise notice shall be accompanied by payment of the aggregate
Exercise Price as to all the Exercised Shares. The Option shall be deemed to be
exercised upon receipt by the Company of such fully executed exercise notice
accompanied by such aggregate Exercise Price. For income tax purposes the
Exercised Shares shall be considered transferred to Optionee on the date the
Option is exercised with respect to such Exercised Shares.
<PAGE>
5. CONDITIONS. The obligations of the Company under this
Option Agreement shall be subject to the approval of such state or federal
authorities or agencies as may have jurisdiction in the matter. The Company will
use its best efforts to take such steps as may be required by state or federal
law or applicable regulations, including rules and regulations of the Securities
and Exchange Commission and any national securities exchange on which the Common
Stock may then be listed, in connection with the issuance or sale of any shares
acquired pursuant to this Option Agreement or the listing of such shares on any
such exchange. The Company shall not be obligated to issue or deliver shares of
Common Stock under this Option Agreement if, upon advice of its legal counsel,
such issuance or delivery would violate state or federal securities laws.
6. METHOD OF PAYMENT. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election of
Optionee:
(i) cash; or
(ii) check; or
(iii) delivery of such documentation as the Committee and
Optionee's broker shall require to effect an exercise of the
Option and delivery to the Company of the sale or margin
loan proceeds required to pay the aggregate Exercise Price
of the Exercised Shares; or
(iv) surrender of other shares of Common Stock which have a Fair
Market Value on the date of surrender equal to the aggregate
Exercise Price of the Exercised Shares.
7. RESTRICTION ON TRANSFER. The Option may not be transferred
in any manner otherwise than by will or by the laws of descent or distribution
or, with the consent of the Committee, pursuant to a qualified domestic
relations order (a "QDRO") as defined by the Code or Title I of the Employee
Retirement Income Security Act of 1974, as amended, and may be exercised during
the lifetime of Optionee only by Optionee or Optionee's guardian or legal
representative or Optionee's permitted assignee or transferee pursuant to a
QDRO. The terms of the Plan and this Option Agreement shall be binding upon the
executors, administrators, heirs, successors and permitted assigns of Optionee.
<PAGE>
8. LEGENDS. All certificates representing any of the shares of
Common Stock subject to the provisions of this Option Agreement may, in the sole
discretion of the Committee, have endorsed thereon the following legends:
(a) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED."
(b) Any legend required to be placed thereon by applicable
Blue Sky laws of any state.
(c) Any legend required to be placed thereon by any
applicable shareholder agreement.
9. EMPLOYMENT; SERVICE. Nothing in the Plan or in this Option
Agreement shall (a) confer upon the Optionee any right with respect to
employment with the Company or any affiliate of the Company or (ii) interfere in
any way with the right of the Company or any affiliate of the Company to
terminate the Optionee's employment (or service as a Director, in accordance
with applicable corporate law, or service as a Consultant) at any time for any
reason, with or without cause.
10. THE PLAN. Although the Option has been granted outside of the
Plan, the parties desire that the Option be subject to the terms and conditions
of the Plan as if it had been granted under the Plan.
11. DEFINITIONS. Any capitalized term in this Option Agreement
which is not defined herein and which is defined in the Plan shall have the same
definition as in the Plan.
12. GOVERNING LAW. To the extent that federal laws (such as the
Code and the federal securities laws) do not otherwise control, the Plan and
this Option Agreement shall be construed in accordance with the laws of the
state of Oregon.
13. HEADINGS. Headings contained in this Option Agreement are for
reference purposes and shall not affect the meaning or interpretation of this
Option Agreement.
Optionee and the Company agree that the Option is granted under
and governed by the terms and conditions of the Plan and this Option Agreement.
Optionee has reviewed the Plan and this Option Agreement in their entirety, has
had an opportunity to obtain the advice of counsel prior to executing this
Option Agreement and fully understands all provisions of the Plan and Option
Agreement. Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Committee upon any questions relating to the
Plan and Option Agreement.
OPTIONEE: PHOENIX GOLD INTERNATIONAL, INC.
/s/ Frank G. Magdlen By: /s/ Kurt W. Ruttum
- ------------------------------ -------------------------------
Signature Kurt W. Ruttum
Vice President and General
Counsel
Frank G. Magdlen
- ------------------------------
Print Name
- ----------------------------
Social Security Number
