As filed with the Securities and Exchange Commission on June 24, 1996
Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NUCO2 INC.
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(Exact name of registrant as specified in its charter)
Florida
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(State or other jurisdiction of incorporation or organization)
65-0180800
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(I.R.S. employer identification no.)
2820 Southeast Market Place, Stuart, Florida 34997
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(Address of principal executive offices) (Zip Code)
NUCO2 INC.
1995 STOCK OPTION PLAN
DIRECTORS' STOCK OPTION PLAN and
OPTIONS TO PURCHASE COMMON STOCK GRANTED TO EMPLOYEES
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(Full title of the plan)
Edward M. Sellian, Chairman of the Board and Chief Executive Officer
NuCo2 Inc.
2820 Southeast Market Place, Stuart, Florida 34997
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(Name and address of agent for service)
(407) 221-1754
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(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price per offering registration
registered registered share(2) price(2) fee
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<S> <C> <C> <C> <C>
Common Shares,
$.001 par value
per share 477,934 shares(1) $20.35 $9,726,590 $3,354.00
==================================================================================================================================
</TABLE>
(1) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the
"Securities Act") an indeterminate number of Common Shares that may
become issuable pursuant to antidilution provisions of the Registrant's
1995 Stock Option Plan (the "1995 Plan") and Directors' Stock Option
Plan (the "Directors' Plan"). (2) Includes 55,991 shares with respect
to which options have been granted under the 1995 Plan at an exercise
price of $9.00 per share, 75,000 shares with respect to which options
have been granted under the 1995 Plan at an exercise price of $17.50
per share, 24,000 shares with respect to which options have been
granted under the Directors' Plan at an exercise price of $9.00 per
share and 67,934 shares with respect to which options have been granted
to two employees at an exercise price of $4.40 per share. An additional
255,009 shares are to be offered at prices not presently determined.
Pursuant to Rule 457(h) under the Securities Act, the offering price
for these additional Common Shares is estimated solely for the purpose
of determining the registration fee and is based on $29.00, the per
share average of high and low sale prices of the Common Shares as
reported by the Nasdaq National Market for trading on June 20, 1996.
<PAGE>
PROSPECTUS
477,934 COMMON SHARES
NUCO2 INC.
Common Shares
This Prospectus relates to the reoffer and resale by certain selling
shareholders (the "Selling Shareholders"), some of whom may be deemed to be
"affiliates" as defined in Rule 405 of the Securities Act of 1933, as amended
(the "Securities Act"), of NuCo2 Inc. (the "Company") of shares (the "Shares")
constituting a portion of the Common Shares, $.001 par value per share (the
"Common Shares"), of the Company that may be issued by the Company to the
Selling Shareholders (i) upon the exercise of options granted or to be granted
under (a) the Company's 1995 Stock Option Plan (the "1995 Plan") or (b) the
Company's Directors' Stock Option Plan (the "Directors' Plan"), or (ii) stock
options granted to two employees (the "Employee Options"). This Prospectus also
relates to the reoffer and resale of Shares to be acquired by individuals who
may be deemed to be "affiliates" of the Company (collectively, the "Future
Selling Shareholders") upon the exercise of stock options to be granted under
the 1995 Plan and Directors' Plan. If and when such options are granted to or
purchased by the Future Selling Shareholders, the Company intends to distribute
a Prospectus Supplement as required by Rule 424(b) of the Securities Act. Such
Prospectus Supplement will specify the names of the Future Selling Shareholders
and the amount of Shares to be reoffered and sold by them.
The Shares are being reoffered and resold for the accounts of the
Selling Shareholders and the Future Selling Shareholders and the Company will
not receive any of the proceeds from the resale of the Shares.
The Selling Shareholders have advised the Company that the resale of
their Shares may be effected from time to time in one or more transactions in
the over-the-counter market, in negotiated transactions or otherwise at market
prices prevailing at the time of the sale or at prices otherwise negotiated. See
"Plan of Distribution." The Company will bear all expenses in connection with
the preparation of this Prospectus.
SEE "RISK FACTORS" BEGINNING ON PAGE 4
FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
The Company's Common Shares are traded on the Nasdaq National Market
under the symbol "NUCO." On June 20, 1996, the last sale price for the Common
Shares, as reported by the Nasdaq National Market, was $28.50.
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is June 24, 1996.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports and other information with the Securities and
Exchange Commission (the "Commission"). Such reports and other information can
be inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549; 500
West Madison Street, Suite 1400, Chicago, Illinois 60661; and Seven World Trade
Center, Suite 1300, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission at Judiciary Plaza,
450 Fifth Street, N.W., Washington, DC 20549, at prescribed rates.
TABLE OF CONTENTS
AVAILABLE INFORMATION.....................................................2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...........................3
RISK FACTORS..............................................................4
THE COMPANY...............................................................8
USE OF PROCEEDS...........................................................9
SELLING SHAREHOLDERS.....................................................10
PLAN OF DISTRIBUTION.....................................................10
LEGAL MATTERS............................................................10
EXPERTS ................................................................10
ADDITIONAL INFORMATION...................................................11
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<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference the following documents
heretofore filed with the Commission:
(a) Prospectus of the Company dated June 7, 1996.
(b) Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended December 31, 1995.
(c) Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended March 31, 1996.
The description of the Common Shares in the Corporation's Registration
Statement on Form 8-A filed December 12, 1995 is incorporated by reference in
this Prospectus and shall be deemed to be a part hereof.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the termination of this
offering, are deemed to be incorporated by reference in this Prospectus and
shall be deemed to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated by reference in this
Prospectus shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein (or in any other
subsequently filed document which is also incorporated by reference in this
Prospectus) modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person
to whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, a copy of any or all of the documents referred to
above which have been or may be incorporated in this Prospectus by reference,
other than exhibits to such documents. Written requests for such copies should
be directed to NuCo2 Inc. at 2820 S.E. Market Place, Stuart, Florida 34997,
Attention: Joseph Criscuolo, President. Oral requests should be directed to such
officer (telephone number (407) 221-1754).
------------------------------------
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company, the Selling Shareholders or the Future Selling Shareholders.
This Prospectus does not constitute an offer to sell, or a solicitation of an
offer to buy, the securities offered hereby to any person in any state or other
jurisdiction in which such offer or solicitation is unlawful. The delivery of
this Prospectus at any time does not imply that information contained herein is
correct as of any time subsequent to its date.
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<PAGE>
RISK FACTORS
PROSPECTIVE INVESTORS SHOULD CONSIDER CAREFULLY THE FOLLOWING FACTORS,
IN ADDITION TO THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS, IN EVALUATING
AN INVESTMENT IN THE COMMON SHARES OFFERED HEREBY.
LIMITED OPERATING HISTORY; LOSSES
The Company was organized in February 1990 and, therefore, has a
limited operating history upon which an evaluation of the Company's future
performance and prospects can be made. The Company has recorded historical net
losses for each quarter from inception through the quarter ended December 31,
1995 and there can be no assurance that the Company will not incur net losses in
the future. From inception to March 31, 1996, the Company incurred a cumulative
net loss of approximately $3.1 million.
LACK OF PRODUCT DIVERSITY
Unlike many of its competitors for whom bulk CO2 is a secondary service
line, the Company has no material lines of business at present other than
leasing of bulk CO2 systems and sale of bulk CO2 and does not anticipate
diversifying into other product or service lines in the near future. In the
event the Company experiences a decline in revenues from leasing bulk CO2
systems or sale of bulk CO2, the Company's results of operations would be
materially and adversely effected.
NEED FOR CAPITAL
The bulk CO2 systems leasing business is capital intensive and the
Company will continue to require substantial capital in order to expand its
business. Prior to the Company's initial public offering in December 1995 (the
"IPO"), the Company depended primarily on debt financing and private placements
of equity for its bulk CO2 systems purchases. If the Company is unable to obtain
additional equity or debt financing in the future, the Company may have to limit
its growth. The interest rate on the Company's principal credit facility
fluctuates with the prime lending rate resulting in greater interest costs to
the Company in the event of rising interest rates.
GROWTH DEPENDENT UPON EXPANSION INTO NEW MARKETS
An important element of the Company's future growth strategy involves
the expansion of the Company's service area into new markets, including markets
which are not contiguous to the Company's existing markets. The ability of the
Company to expand in the future will depend on a number of factors, including
the acceptance by potential customers of the Company's bulk CO2 systems, the
adaptability of the Company to local market conditions and trade practices, the
availability of skilled management and personnel, adequate financing and other
factors, some of which are beyond the control of the Company. There can be no
assurance that the Company's expansion plans will be achieved.
LIMITED AVAILABILITY OF MANAGERIAL PERSONNEL
The Company is currently experiencing rapid growth that could strain
the Company's managerial and other resources. Since November 1994, the Company's
service area has expanded from Florida to throughout the southeastern United
States and the New York metropolitan area. The Company has opened service and
supply depots in Georgia, Alabama, Louisiana, Mississippi, South Carolina, North
Carolina, Arkansas, Tennessee and New York. In addition, from December 30, 1994
through March 31, 1996, the number of the Company's full-time employees
increased from 49 to 113, and further increases are anticipated. The Company
intends to open additional service and supply depots and to staff such depots as
needed. For the Company to be able to continue to grow effectively it will need
to
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<PAGE>
continue to improve its operational, financial and other internal systems, and
to attract, train, motivate, manage and retain its employees. If the Company is
unable to manage growth effectively, the Company's results of operations could
be adversely affected.
COMPETITION
The Company competes with other distributors of bulk CO2 and high
pressure CO2, including several regional industrial gas companies, numerous
small independent operators and distributors of restaurant supplies and
groceries. Bulk CO2 systems typically are serviced by industrial gas and welding
supply companies, specialty gas distributors and fountain supply companies.
These suppliers range widely in size. Some of the Company's competitors have
significantly greater financial, technical or marketing resources than the
Company. In addition, certain companies may have an advantage over the Company
with customers who prefer dealing with one company that can supply bulk CO2 as
well as fountain syrup. These competitors could introduce additional products or
add features to their existing products that are superior to the Company's
products or that achieve greater market acceptance. In addition, the Company
faces the risk of a well capitalized competitor's entry into its existing or
future markets as there are no major barriers to entry. The Company believes
that its ability to compete depends on a number of factors, including price,
product quality, availability and reliability, credit terms, name recognition,
delivery time and post-sale service and support. There can be no assurance that
the Company will be able to continue to compete successfully with respect to
these factors.
ACQUISITION AVAILABILITY; DIFFICULTY IN ASSIMILATING ACQUISITIONS
An important element of the Company's future growth strategy involves
the acquisition of additional bulk CO2 systems leasing businesses. A significant
portion of the increase in the Company's net sales since 1992 is attributable to
acquisitions of bulk CO2 systems leasing businesses, the largest of which was
the acquisition of the assets of Bevtech, Inc. in June 1995. In January 1996,
the Company acquired two bulk CO2 businesses, one operating in Arkansas,
Mississippi, Louisiana and Texas and the other operating in Florida, Georgia and
Alabama. In May 1996, the Company acquired the bulk CO2 business in New York,
New Jersey and Connecticut of The Coca-Cola Bottling Company of New York, Inc.
as well as a second bulk CO2 business operating in Mississippi. Although the
Company intends to continue to pursue additional acquisitions, there can be no
assurance that the Company will be able to locate or acquire other suitable
acquisition candidates on acceptable terms, or that future acquired operations
will be effectively and profitably integrated into the Company. Properly
managing any growth through acquisition, avoiding the problems often attendant
therewith, and continuing to operate in the manner which has proven successful
to the Company to date will be critical to the future success of the Company's
business.
DEPENDENCE ON FOOD AND BEVERAGE INDUSTRY; SEASONALITY
Approximately 95% of the Company's net sales for the nine months ended
March 31, 1996 were derived from sales to the food and beverage industry. Any
recession experienced by the food and beverage industry could have an adverse
impact on the Company's business. In addition, any significant shift in consumer
preferences away from carbonated beverages to other types of beverages would
have an adverse impact on the Company. Of the Company's over 15,000 customers,
as of May 17, 1996 3,400 were billed utilizing a "rental plus per pound charge"
program. Additionally, 2,750 accounts own their bulk CO2 systems and are billed
by the pound for bulk CO2 delivered. Customers purchasing bulk CO2 by the pound
will tend to consume less CO2 in the winter months and the Company's net sales
to such customers will be correspondingly lower in times of cold or inclement
weather.
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<PAGE>
LIMITED GROWTH IN RETAIL CO2 INDUSTRY
The retail CO2 industry is mature, with only limited growth in total
demand for CO2 foreseen. Therefore, the Company's ability to grow within the
industry is dependent upon the success of its marketing efforts in acquiring new
customers and their acceptance of bulk CO2 systems in replacing high pressure
cylinders, the success of the Company in opening new supply and service depots
in additional geographic areas and its ability to acquire other retail
distributors.
PRICING AND INVENTORY RISK; EFFECT ON PROFITABILITY
CO2 is a commodity and, as such, its unit price is subject to
fluctuations in response to changes in supply or other market conditions over
which the Company has no control. Although the unit price of CO2 purchased by
the Company has remained relatively stable over time, it could change rapidly.
In the event of future increases in the unit price of CO2 purchased by the
Company, the Company may not be able to fully pass on such price increases to
its customers. Consequently, the Company's profitability may be sensitive to
changes in wholesale CO2 prices.
DEPENDENCE ON SUPPLIERS OF BULK CO2 SYSTEMS; FEW SOURCES OF SUPPLY
Since the Company does not manufacture bulk CO2 systems, it must
purchase all of the bulk CO2 systems it leases. The Company purchases new bulk
CO2 systems from Minnesota Valley Engineering, Inc. and Taylor Wharton
Cryogenics (a division of Harsco Corporation), the two major manufacturers of
such equipment. Any event adversely affecting the supply of bulk CO2 systems,
including the inability of such manufacturers to meet demand for the purchase of
new bulk CO2 systems, could have a material adverse effect on the Company's
operations. The Company has no control over the manufacturing process, quality
assurance or the timing of delivery of bulk CO2 systems. The Company does not
have any contracts with either Minnesota Valley Engineering, Inc. or
Taylor-Wharton Cryogenics for the purchase of bulk CO2 systems.
NEED TO MEET TECHNOLOGICAL ADVANCES
The Company's success will depend in part on its ability to obtain new
bulk CO2 customers by converting existing users of high pressure cylinders to
bulk CO2 systems and to keep pace with possible changes in CO2 delivery
technology, evolving industry standards and changing client preferences. There
can be no assurance that the Company will be successful in addressing these
developments on a timely basis or that, if addressed, the Company will be
successful in the marketplace. The Company's inability to address these
developments could have a material adverse effect on the Company's business and
operations.
DEPENDENCE ON KEY PERSONNEL
The Company will continue to be dependent to a significant extent upon
the efforts and abilities of Edward M. Sellian, its Chairman of the Board and
Chief Executive Officer, and Joseph M. Criscuolo, its President and Chief
Operating Officer. The loss of the services of either Mr. Sellian or Mr.
Criscuolo could have a material adverse effect on the Company. The Company does
not maintain key man life insurance on Mr. Sellian or Mr. Criscuolo. The Company
has no employment agreement with Mr. Sellian or Mr. Criscuolo; however, each of
Mr. Sellian and Mr. Criscuolo has entered into a noncompetition agreement with
the Company. In addition, the Company's ability to grow successfully will be
dependent upon its ability to attract and retain additional skilled management
personnel.
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<PAGE>
OPERATING RISKS MAY NOT BE COVERED BY INSURANCE
The Company's operations are subject to all of the operating hazards
and risks normally incidental to handling, storing and transporting bulk CO2,
which as a compressed gas is classified as a hazardous material. The Company
maintains insurance policies in such amounts and with such coverages and
deductibles as the Company believes are reasonable and prudent. However, there
can be no assurance that such insurance will be adequate to protect the Company
from liabilities and expenses that may arise from claims for personal and
property damage arising in the ordinary course of business or that such levels
of insurance will be maintained by the Company or will be available at
economical prices.
EFFECT OF GOVERNMENTAL REGULATION
The business of the Company is subject to federal and state laws and
regulations adopted for the protection of the environment, the health and safety
of employees and users of the Company's products. The transportation of bulk CO2
is subject to regulation by various federal, state and local agencies, including
the U.S. Department of Transportation. These regulatory authorities have broad
powers, and the Company is subject to regulatory and legislative changes that
can affect the economics of the industry by requiring changes in operating
practices or influencing the demand for, and the cost of providing, its
services.
CONTROL BY DIRECTORS AND EXECUTIVE OFFICERS
The directors and executive officers of the Company beneficially own or
have voting control over approximately 1,177,902 Common Shares, or approximately
16.6% of the outstanding Common Shares. Such persons will therefore be in a
position to significantly influence the outcome of matters submitted for
shareholder approval, including election of the Company's directors, and could
thereby affect the selection of management and direct policies of the Company.
POSSIBLE VOLATILITY OF STOCK PRICE
The market price of the Common Shares has risen substantially since the
IPO. Macroeconomic and general market factors beyond the control of the Company
may cause the market price for the Common Stock to be volatile in future
periods. Quarterly operating results of the Company; changes in general
conditions in the economy, the financial markets or the bulk CO2 industry; and
natural disasters or other developments affecting the Company or its competitors
could cause the market price of the Common Stock to fluctuate substantially. In
addition, in recent years the stock market has experienced extreme price and
volume fluctuations. This volatility has had a significant effect on the market
prices of securities issued by many companies often for reasons unrelated to the
operating performance of these companies.
NO DIVIDENDS ANTICIPATED
The Company intends to retain all future earnings for use in the
development of its business and does not anticipate paying any cash dividends on
the Common Shares in the foreseeable future. In addition, the payment of cash
dividends on the Common Shares is restricted by financial covenants in the
Company's loan agreements.
SHARES ELIGIBLE FOR FUTURE SALE
As of June 18, 1996, the Company had approximately 7,095,500 Common
Shares outstanding. 1,728,858 Common Shares are "restricted" securities as
defined in Rule 144 promulgated under the Securities Act of 1933, as amended
(the "Securities Act") and may not be sold unless they are registered under the
Securities Act or are sold pursuant to an exemption from registration, including
an exemption contained in Rule 144. On July 27, 1995, the Securities and
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<PAGE>
Exchange Commission proposed to reduce the Rule 144(d) holding period for
resales of restricted securities from two years to one year and to reduce the
Rule 144(k) holding period from three years to two years. If the Rule 144
changes are adopted, the reduced holding periods will apply to all restricted
securities. The holders of 555,796 restricted Common Shares have certain rights
to require the Company to register the sale of such shares under the Securities
Act. Sales of substantial amounts of Common Shares, or the perception that such
sales could occur, may adversely affect the market price of the Common Shares
prevailing from time to time.
EFFECTS OF CERTAIN CHARTER PROVISIONS; ANTI-TAKEOVER EFFECTS OF CHARTER AND
FLORIDA LAW
The rights of the holders of the Common Shares will be subject to, and
may be adversely affected by, the rights of the holders of any Preferred Stock
that may be issued in the future. The Board of Directors has the authority to
issue up to 5,000,000 shares of Preferred Stock and to determine the price,
rights, preferences, privileges and restrictions of those shares without any
further vote or action by the shareholders. Although the Company has no present
plans to issue shares of Preferred Stock, the issuance of Preferred Stock could
have the effect of making it more difficult for a third party to acquire a
majority of the outstanding voting stock of the Company or could otherwise
dilute the rights of holders of the Common Shares. Certain provisions of Florida
law and the Company's Articles of Incorporation may discourage persons from
making, or make it more difficult for persons to make a tender offer for, or
acquisitions of, substantial amounts of the Company's Common Shares or from
launching other takeover attempts that a shareholder might consider in such
shareholder's best interest.
THE COMPANY
NuCo2 Inc. operates in a relatively new industry which supplies liquid
carbon dioxide ("liquid" or "bulk CO2") to retail establishments for use in the
carbonation and dispensing of fountain beverages. NuCo2 Inc. is the largest
company in this industry as measured by aggregate purchases of bulk CO2 systems
from the manufacturers of such systems. Carbon dioxide is required to dispense
carbonated beverages and is presently supplied in most instances in the form of
CO2 gas, which is transported and stored in high pressure cylinders. The Company
believes high pressure cylinders are being displaced by bulk CO2 systems
because, from a customer's perspective, bulk CO2 systems enjoy several
qualitative and economic advantages over high pressure cylinders. The Company
presently has operations in 13 states and services over 15,000 customers, which
consist primarily of restaurants, convenience stores, taverns, theaters, theme
parks, resorts and stadiums. The Company's objective is to expand its business
nationally and establish itself as the dominant national supplier of bulk CO2
for beverage applications.
The Company offers its customers two principal services: a stationary
bulk CO2 system installed on the customer's premises and routine filling of the
system with liquid CO2 according to a defined schedule. Typically the system is
owned by the Company and leased to the customer under a five year noncancelable
contract, although some customers own their own system. The Company operates a
network of service and supply depots and a fleet of specialized delivery trucks
which deliver liquid CO2 to customers' locations. The system utilizes a
cryogenic vessel which preserves CO2 in its liquid form until its conversion to
gaseous form for use in beverage carbonation. Advantages to users of bulk CO2
systems include elimination of "flat" drinks, elimination of fountain drink
dispensing downtime and product waste during cylinder changeovers, avoidance of
employee handling of heavy cylinders, kitchen space efficiency and enhanced
safety. Bulk CO2 systems are typically offered to customers at price levels
which are comparable to the cost of high pressure cylinders. Based on data from
the manufacturers of bulk CO2 systems and restaurant and other industry data,
the
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Company estimates that bulk CO2 systems have captured less than 15% of the
beverage CO2 market in the United States and less than 20% of the beverage CO2
market within the Company's primary service area in 10 southeastern states.
Based on restaurant and other industry data, the Company estimates that there
are over 600,000 beverage related CO2 users in the United States. The first bulk
CO2 systems for beverage applications were commercialized in 1986 by Minnesota
Valley Engineering, Inc., one of the manufacturers of bulk CO2 systems.
The competitive strategy of the Company is focused on the bulk CO2
market and consists of several elements. Unlike many of its competitors, for
whom bulk CO2 is a secondary service line, the Company has no material lines of
business at present other than bulk CO2. The Company's strategy emphasizes the
placement of a Company owned bulk CO2 system on the customer's premises under
long-term contracts, adding stability to the Company's revenue base. In fiscal
1995, less than 5% of Company owned bulk CO2 systems experienced service
termination. Service termination is typically caused by restaurant closure.
There are competitive advantages stemming from scale and delivery route density
in the Company's industry that the Company enjoys as the leading supplier of
bulk CO2 in most of its current markets. Route density lowers the average cost
per bulk CO2 delivery and makes entry by new competitors more difficult by
reducing their ability to achieve economies of scale. The Company differentiates
itself through its attention to customer service, including 24-hour, seven day a
week service capabilities. The Company offers a broad range of bulk CO2 system
sizes to access the entire spectrum of potential customers, and provides rapid
installation through its specialized installation personnel and vehicles.
The Company commenced operations in 1990 with the acquisition of 19
bulk CO2 systems in Florida from an industrial gas distributor. As of March 31,
1996, the Company had added 7,864 bulk CO2 customers through internal growth and
5,393 bulk CO2 customers through nine acquisitions. The Company significantly
expanded the scope of its operations with the acquisition of Bevtech, Inc. in
June 1995. Bevtech serviced a total of 3,093 bulk CO2 systems. On May 15, 1996,
the Company acquired the bulk CO2 operations in New York, New Jersey and
Connecticut of The Coca-Cola Bottling Company of New York, Inc. The Company
acquired approximately 1,030 bulk CO2 systems presently in service at customers'
locations and, in addition, contracts to provide bulk CO2 refill only service to
approximately 220 customer owned bulk CO2 systems. The Company intends to grow
primarily through internal means, but also expects to make acquisitions as a
method of strategically entering new geographic markets and building route
density within existing markets. The Company believes that there are more than
100 businesses in the United States which service between 250 and 750 bulk CO2
accounts and more than 10 businesses which service between 1,000 and 6,000
accounts. The Company's internal growth initiatives consist of marketing
multi-system placements to corporate and franchised operations of large
restaurant, convenience store and theater chains. The Company has negotiated
multi-system placements or CO2 supply contracts with numerous customers,
including McDonald's, Pizza Hut, Kentucky Fried Chicken, Burger King, Wendy's,
Hardees, Subway, Shoney's, Chili's, 7-Eleven, Circle K, EZ Serve, Carmike
Cinemas, AMC Theaters, Universal Studios, Walt Disney World and Joe Robbie
Stadium. The Company's relationships with chain customers in one geographic
market frequently help it establish service with these same chains when the
Company expands to new markets. After accessing the chain accounts in a new
market, the Company attempts to rapidly build route density by leasing bulk CO2
systems to independent restaurants, convenience stores and theaters.
USE OF PROCEEDS
The Company will receive the exercise price of the options when
exercised by the holders thereof. The Company will not receive any of the
proceeds from the reoffer and resale of the Shares by the Selling Shareholders
and the Future Selling Shareholders.
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<PAGE>
SELLING SHAREHOLDERS
This Prospectus relates to the reoffer and resale of Shares issued or
that may be issued to the Selling Shareholders under the 1995 Plan, the
Directors' Plan or the Employee Options.
The following table sets forth (i) the number of Common Shares
beneficially owned by each Selling Shareholder prior to the Offering, (ii) the
number of Shares to be offered for resale by each Selling Shareholder and (iii)
the number and percentage of Common Shares to be held by each Selling
Shareholder after completion of the offering.
<TABLE>
<CAPTION>
Number of Common
Number of Shares/Percentage of
Number of Common Shares to be Class to be Owned
Shares Owned Prior Offered for After Completion of
Name to the Offering Resale the Offering
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<S> <C> <C> <C>
Joseph M. Criscuolo 93,920(1) 75,000 93,920/1.3%
Jean Houghton 33,967(2)(3) 48,750 --/--
Robert Ranieri 33,967(2)(3) 48,750 --/--
Robert L. Frome 27,222(4) 6,000 27,222/*
John J. O'Neil --(4) 6,000 --/--
Edward F. O'Reilly --(4) 6,000 --/--
William B. Porter --(4) 6,000 --/--
</TABLE>
- -----------------------------
* Less than 1%.
(1) Excludes 75,000 Common Shares issuable upon the exercise of stock
options. No part of such options is currently exercisable.
(2) Represents shares issuable upon exercise of currently exercisable stock
options.
(3) Excludes 14,783 Common Shares issuable upon the exercise of stock
options. No part of such options is currently exercisable.
(4) Excludes 6,000 shares of Common Shares issuable upon the exercise of
stock options. No part of such options is currently exercisable.
PLAN OF DISTRIBUTION
It is anticipated that all of the Shares will be offered by the Selling
Shareholders from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions or otherwise at market
prices prevailing at the time of the sale or at prices otherwise negotiated. The
Selling Shareholders have advised the Company that they are not parties to any
agreement, arrangement or understanding as to such sales.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the Shares
offered hereby have been passed upon for the Company by Messrs. Olshan Grundman
Frome & Rosenzweig LLP, 505 Park Avenue, New York, New York 10022. Certain
members of such firm own an aggregate of 39,444 Common Shares. Robert L. Frome,
a member of such firm, is a director of the Company.
EXPERTS
The financial statements of NuCo2 Inc. as of June 30,1995 and for the
year then ended, have been incorporated by reference herein and in the
Registration Statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein and
upon the authority of said firm as experts in accounting and auditing.
-10-
<PAGE>
The financial statements of the Company as of June 30, 1994 and for the
year then ended, the financial statements of Bevtech, Inc., as of June 7, 1995
and June 30,1994, and for the period July 1, 1994 through June 7, 1995 and the
year ended June 30, 1994, and the statement of net assets to be sold of the bulk
CO2 operating segment of the BevServ Division of The Coca-Cola Bottling Company
of New York, Inc. as of December 31, 1995 and the related historical summary of
net sales and direct operating expenses for the year then ended have been
incorporated herein in reliance on the report of Cooper Selvin & Strassberg LLP,
independent certified public accountants, given on the authority of said firm as
experts in auditing and accounting.
ADDITIONAL INFORMATION
The Company has filed with the Commission a Registration Statement on
Form S-8 under the Securities Act with respect to the Shares offered hereby. For
further information with respect to the Company and the securities offered
hereby, reference is made to the Registration Statement. Statements contained in
this Prospectus as to the contents of any contract or other document are not
necessarily complete, and in each instance, reference is made to the copy of
such contract or document filed as an exhibit to the Registration Statement,
each such statement being qualified in all respects by such reference.
-11-
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS REFERENCE
The following documents filed by NuCo2 Inc. (the "Company") with the
Securities and Exchange Commission are incorporated herein by reference:
(a) Prospectus of the Company dated June 7, 1996.
(b) Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended December 31, 1995.
(c) Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended March 31, 1996.
The description of the Common Shares in the Corporation's Registration
Statement on Form 8-A filed December 12, 1995 is incorporated by reference in
this Prospectus and shall be deemed to be a part hereof.
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, as amended, after the effective date of this registration statement and
prior to the filing of a post-effective amendment which indicates that all
securities offered hereunder 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. INTEREST OF NAMED EXPERTS AND COUNSEL
Certain legal matters in connection with the issuance of the Shares
offered hereby have been passed upon for the Company by Messrs. Olshan Grundman
Frome & Rosenzweig LLP, 505 Park Avenue, New York, New York 10022. Certain
members of such firm own an aggregate of 39,444 Common Shares. Robert L. Frome,
a member of such firm, is a director of the Company.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Except as hereinafter set forth, there is no statute, charter
provision, by-law, contract or other arrangement under which any controlling
person, director or officer of the Company is insured or indemnified in any
manner against liability which he may incur in his capacity as such.
The Articles of Incorporation and by laws of the Company provide that
the Company may indemnify to the fullest extent permitted by Florida law any
person whom it may indemnify thereunder, including directors, officers,
employees and agents of the Company.
The Company has also agreed to indemnify each director and executive
officer pursuant to an Indemnification Agreement with each such director and
executive officer from and against any and all expenses, losses, claims, damages
and liability incurred by such director or executive officer for or as a result
of action taken or not taken while such director or executive officer was acting
in his capacity as a director, officer, employee or agent of the Company, to the
fullest extent permitted under Florida law.
II-1
<PAGE>
The Company has obtained a directors' and officers' insurance and
company reimbursement policy in the amount of $2,000,000. The policy insures
directors and officers against unindemnified loss arising from certain wrongful
acts in their capacities and would reimburse the Company for such loss for which
the Company has lawfully indemnified the directors and officers.
See the last paragraph of Item 9 below for information regarding the
position of the Securities and Exchange Commission with respect to the effect of
any indemnification for liabilities arising under the Securities Act.
Section 607.0850 of the Florida Business Corporation Act.
INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES, AND AGENTS. (1) A
corporation shall have power to indemnify any person who was or is a party to
any proceeding (other than an action by, or in the right of, the corporation),
by reason of the fact that he is or was a director, officer, employee, or agent
of the corporation or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise against liability incurred in connection
with such proceeding, including any appeal thereof, if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any proceeding by judgment, order, settlement, or conviction or
upon a plea of nolo contendere or its equivalent shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in, or not opposed to, the best interests of the
corporation or, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(2) A corporation shall have power to indemnify any person, who was or
is a party to any proceeding by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee, or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other enterprise, against
expenses and amounts paid in settlement not exceeding, in the judgment of the
board of directors, the estimated expense of litigating the proceeding to
conclusion, actually and reasonably incurred in connection with the defense or
settlement of such proceeding, including any appeal thereof. Such
indemnification shall be authorized if such person acted in good faith and in a
manner he reasonably believed to be in, or not opposed to, the best interests of
the corporation, except that no indemnification shall be made under this
subsection in respect of any claim, issue, or matter as to which such person
shall have been adjudged to be liable unless, and only to the extent that, the
court in which such proceeding was brought, or any other court of competent
jurisdiction, shall determine upon application that, despite the adjudication of
liability but in view of all circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which such court shall
deem proper.
(3) To the extent that a director, officer, employee, or agent of a
corporation has been successful on the merits or otherwise in defense of any
proceeding referred to in subsection (1) or subsection (2), or in defense of any
claim, issue, or matter therein, he shall be indemnified against expenses
actually and reasonably incurred by him in connection therewith.
(4) Any indemnification under subsection (1) or subsection (2), unless
pursuant to a determination by a court, shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee, or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in subsection (1) or
subsection (2). Such determination shall be made:
II-2
<PAGE>
(a) By the board of directors by a majority vote of a
quorum consisting of directors who were not parties to such proceeding;
(b) If such a quorum is not obtainable or, even if
obtainable, by majority vote of a committee duly designated by the
board of directors (in which directors who are parties may participate)
consisting solely of two or more directors not at the time parties to
the proceeding;
(c) By independent legal counsel:
1. Selected by the board of directors prescribed in
paragraph (a) or the committee prescribed in paragraph (b);
or
2. If a quorum of the directors cannot be obtained
for paragraph (a) and the committee cannot be designated
under paragraph (b), selected by majority vote of the full
board of directors (in which directors who are parties may
participate); or
(d) By the shareholders by a majority vote of a quorum
consisting of shareholders who were not parties to such proceeding or,
if no such quorum is obtainable, by a majority vote of shareholders who
were not parties to such proceeding.
(5) Evaluation of the reasonableness of expenses and authorization of
indemnification shall be made in the same manner as the determination that
indemnification is permissible. However, if the determination of permissibility
is made by independent legal counsel, persons specified by paragraph (4)(c)
shall evaluate the reasonableness of expenses and may authorize indemnification.
(6) Expenses incurred by an officer or director in defending a civil or
criminal proceeding may be paid by the corporation in advance of the final
disposition of such proceeding upon receipt of an undertaking by or on behalf of
such director or officer to repay such amount if he is ultimately found not to
be entitled to indemnification by the corporation pursuant to this section.
Expenses incurred by other employees and agents may be paid in advance upon such
terms or conditions that the board of directors deems appropriate.
(7) The indemnification and advancement of expenses provided pursuant
to this section are not exclusive, and a corporation may make any other or
further indemnification or advancement of expenses of any of its directors,
officers, employees, or agents, under any bylaw, agreement, vote of shareholders
or disinterested directors, or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office.
However, indemnification or advancement of expenses shall not be made to or on
behalf of any director, officer, employee, or agent if a judgment or other final
adjudication establishes that his actions, or omissions to act, were material to
the cause of action so adjudicated and constitute:
(a) A violation of the criminal law, unless the director,
officer, employee, or agent had reasonable cause to believe his
conduct was lawful or had no reasonable cause to believe his conduct
was unlawful;
(b) A transaction from which the director, officer,
employee, or agent derived an improper personal benefit;
(c) In the case of a director, a circumstance under which
the liability provisions of s. 607.0834 are applicable; or
(d) Willful misconduct or a conscious disregard for the best
interests of the corporation in a proceeding by or in the right of the
corporation to procure a judgment in its favor or in a proceeding by
or in the right of a shareholder.
II-3
<PAGE>
(8) Indemnification and advancement of expenses as provided in this
section shall continue as, unless otherwise provided when authorized or
ratified, to a person who has ceased to be a director, officer, employee, or
agent and shall inure to the benefit of the heirs, executors, and administrators
of such a person, unless otherwise provided when authorized or ratified.
(9) Unless the corporation's articles of incorporation provide
otherwise, notwithstanding the failure of a corporation to provide
indemnification, and despite any contrary determination of the board or of the
shareholders in the specific case, a director, officer, employee, or agent of
the corporation who is or was a party to a proceeding may apply for
indemnification or advancement of expenses, or both to the court conducting the
proceeding, to the circuit court, or to another court of competent jurisdiction.
On receipt of an application, the court, after giving any notice that it
considers necessary, may order indemnification and advancement of expenses,
including expenses incurred in seeking court-ordered indemnification or
advancement of expenses, if it determines that:
(a) The director, officer, employee, or agent is entitled to
mandatory indemnification under subsection (3), in which case the
court shall also order the corporation to pay the director reasonable
expenses incurred in obtaining court-ordered indemnification or
advancement of expenses;
(b) The director, officer, employee, or agent is entitled to
indemnification or advancement of expenses, or both, by virtue of the
exercise by the corporation of its power pursuant to subsection (7);
or
(c) The director, officer, employee, or agent is fairly and
reasonably entitled to indemnification or advancement of expenses, or
both, in view of all the relevant circumstances, regardless of whether
such person met the standard of conduct set forth in subsection (1)
subsection (2), or subsection (7).
(10) For purposes of this section, the term "corporation" includes, in
addition to the resulting corporation, any constituent corporation (including
any constituent of a constituent) absorbed in a consolidation or merger, so that
any person who is or was a director, officer, employee, or agent of a
constituent corporation, or is or was serving at the request of a constituent
corporation as a director, officer, employee, or agent of another corporation,
partnership, joint venture, trust, or other enterprise, is in the same position
under this section with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if its separate
existence had continued.
(11) For purposes of this section:
(a) The term "other enterprises" includes employee benefit
plans;
(b) The term "expenses" includes counsel fees, including
those for appeal;
(c) The term "liability" includes obligations to pay a
judgment, settlement, penalty, fine (including an excise tax assessed
with respect to any employee benefit plan), and expenses actually and
reasonably incurred with respect to a proceeding;
(d) The term "proceeding" includes any threatened, pending,
or completed action, suit, or other type of proceeding, whether civil,
criminal, administrative, or investigative and whether formal or
informal;
(e) The term "agent" includes a volunteer;
II-4
<PAGE>
(f) The term "serving at the request of the corporation"
includes any service as a director, officer, employee, or agent of the
corporation that imposes duties on such persons, including duties
relating to an employee benefit plan and its participants or
beneficiaries; and
(g) The term "not opposed to the best interest of the
corporation" describes the actions of a person who acts in good faith
and in a manner he reasonably believes to be in the best interests of
the participants and beneficiaries of an employee benefit plan.
(12) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee, or agent of
the corporation or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise against any liability asserted against him
and incurred by him in any such capacity or arising out of his status as such,
whether or not the corporation would have the power to indemnify him against
such liability under the provisions of this section.
The Company has also agreed to indemnify each director and executive
officer pursuant to an Indemnification Agreement with each such director and
executive officer from and against any and all expenses, losses, claims, damages
and liability incurred by such director or executive officer for or as a result
of action taken or not taken while such director or executive officer was acting
in his capacity as a director, officer, employee or agent of the Company, to the
fullest extent permitted under Florida law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
EXHIBIT INDEX
4(a) 1995 Stock Option Plan.
4(b) Directors' Stock Option Plan.
4(c) Stock Option Agreement dated as of June 7, 1995 issued to Jean
Houghton.
4(d) Stock Option Agreement dated as of June 7, 1995 issued to
Robert Ranieri.
5 Opinion of Olshan Grundman Frome & Rosenzweig LLP with respect
to the securities registered hereunder.
23(a) Consent of Olshan Grundman Frome & Rosenzweig LLP (included in
its opinion filed as Exhibit 5).
23(b) Consent of KPMG Peat Marwick LLP.
23(c) Consent of Cooper, Selvin & Strassberg LLP.
24 Powers of Attorney (included on the signature page to this
Registration Statement).
ITEM 9. UNDERTAKINGS
The undersigned registrant hereby undertakes:
II-5
<PAGE>
a. To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement 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.
b. That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
c. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-6
<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Stuart, State of Florida on this 24th day of June,
1996.
NUCO2 INC.
----------------------------------------------
(Registrant)
By: /s/ Edward M. Sellian
------------------------------------------
Edward M. Sellian, Chief Executive Officer
POWER OF ATTORNEYS AND SIGNATORIES
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 indicated. Each of the undersigned officers and
directors of NuCo2 Inc. hereby constitutes and appoints Edward M. Sellian and
Joseph M. Criscuolo and each of them singly, as true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution,
for him in his name in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement and to file
the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission and to prepare any and
all exhibits thereto, and other documents in connection therewith, and to make
any applicable state securities law or blue sky filings, granting unto said
attorneys-in-fact and agents, full power and authority to do and perform each
and every act and thing requisite or necessary to be done to enable NuCo2 Inc.
to comply with the provisions of the Securities Act of 1933, as amended, and all
requirements of the Securities and Exchange Commission, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or their substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
SIGNATURE TITLE DATE
/s/ Edward M. Sellian Chairman of the Board and Chief
- ------------------------- Executive Officer (Principal
(Edward M. Sellian) Executive Officer) June 24, 1996
/s/ Joseph M. Criscuolo President, Chief Operating Officer
- ------------------------- and Director June 24, 1996
(Joseph M. Criscuolo)
/s/ Edward W. Dean Chief Financial Officer (Principal June 24, 1996
- ------------------------- Financial Officer and Principal
(Edward W. Dean) Accounting Officer)
/s/ Robert L. Frome Director June 24, 1996
- -------------------------
(Robert L. Frome)
- -------------------------- Director
(John J. O'Neil)
/s/ Edward F. O'Reilly Director June 24, 1996
- --------------------------
(Edward F. O'Reilly)
/s/ William B. Porter Director June 24, 1996
- ---------------------------
(William B. Porter)
II-7
<PAGE>
The 1995 Plan. Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Stuart, State of Florida
on June 24, 1996.
NUCO2 INC.
-----------------------------------
1995 STOCK OPTION PLAN
By: /s/ William B. Porter
------------------------------------
William B. Porter,
Member of Stock Option Committee
By: /s/ Edward F. O'Reilly
-------------------------------------
Edward F. O'Reilly,
Member of Stock Option Committee
By: /s/ Robert L. Frome
-------------------------------------
Robert L. Frome,
Member of Stock Option Committee
By: /s/ John J. O'Neil
-------------------------------------
John J. O'Neil,
Member of Stock Option Committee
II-8
EXHIBIT 4(a)
NUCO2 INC.
1995 STOCK OPTION PLAN
1. PURPOSES
The purpose of the Plan is to provide additional incentive to the
officers and employees of the Company who are primarily responsible for the
management and growth of the Company, or otherwise materially contribute to the
conduct and direction of its business, operations and affairs, in order to
strengthen their desire to remain in the employ of the Company and to stimulate
their efforts on behalf of the Company, and to retain and attract to the employ
of the Company persons of competence. Each option granted pursuant to the Plan
shall be designated at the time of grant as either an "incentive stock option"
or as a "non-qualified stock option." The terms and conditions of the Plan shall
be set forth or incorporated by reference in the option agreements evidencing
the options.
2. DEFINITIONS
For the purposes of the Plan, unless the context otherwise requires,
the following definitions shall be applicable:
(a) "Board" or "Board of Directors" means the Company's Board of
Directors.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Committee" means the Stock Option Committee composed of two or
more members of the Board of Directors, and who shall be responsible for
administering the Plan. Each of the members of the Committee shall be a
Disinterested Person.
(d) "Company" means Fowler Carbonics, Inc.
(e) "Disinterested Person" means a disinterested person, as defined in
Rule 16b-3 under the Exchange Act.
(f) "Employee" means an employee of the Company or of a Subsidiary
(including a director or officer of the Company or a Subsidiary who is also an
employee).
(g) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
<PAGE>
(h) "Fair Market Value" of the Shares means the closing price of
publicly traded Shares on the national securities exchange on which the Shares
are listed (if the Shares are so listed) or on the Nasdaq National Market (if
the Shares are regularly quoted on the Nasdaq National Market), or, if not so
listed or regularly quoted, the mean between the closing bid and asked prices of
publicly traded Shares in the over-the-counter market, or, if such bid and asked
prices shall not be available, as reported by any nationally recognized
quotation service selected by the Company, or as determined by the Committee in
a manner consistent with the provisions of the Code.
(i) "ISO" means an option intended to qualify as an incentive stock
option under Section 422 of the Code.
(j) "NQO" means an option that does not qualify as an ISO.
(k) "Plan" means the 1995 Stock Option Plan of the Company.
(l) "Securities Act" means the Securities Act of 1933, as amended.
(m) "Shares" means shares of the Company's Common Stock, $.05 par
value, including authorized but unissued shares and shares that have been
previously issued and reacquired by the Company.
(n) "Subsidiary" of the Company means and includes a "Subsidiary
Corporation," as that term is defined in Section 425(f) of the Code.
3. ADMINISTRATION
Subject to the express provisions of the Plan, the Committee shall have
authority to interpret and construe the Plan, to prescribe, amend and rescind
rules and regulations relating to it, to determine the terms and conditions of
the respective option agreements (which need not be identical) and to make all
other determinations necessary or advisable for the administration of the Plan.
Subject to the express provisions of the Plan, the Committee, in its sole
discretion, shall from time to time determine the persons from among those
eligible under the Plan to whom, and the time or times at which, options shall
be granted, the number of Shares to be subject to each option, whether an option
shall be designated an ISO or an NQO and the manner in and price at which such
option may be exercised. In making such determination, the Committee may take
into account the nature and period of service rendered by the respective
optionees, their level of compensation, their past, present and potential
contributions to the Company and such other factors as the Committee shall in
its discretion deem relevant. The determination of the Committee with
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<PAGE>
respect to any matter referred to in this Section 3 shall be conclusive.
4. ELIGIBILITY FOR PARTICIPATION
Any Employee shall be eligible to receive ISOs or NQOs granted under
the Plan.
5. LIMITATION ON SHARES SUBJECT TO THE PLAN
Subject to adjustment as hereinafter provided, no more than 350,000
Shares may be issued pursuant to the exercise of options granted under the Plan.
If any option shall expire or terminate for any reason, without having been
exercised in full, the unpurchased Shares subject thereto shall again be
available for the purposes of the Plan.
6. TERMS AND CONDITIONS OF OPTIONS
Each option granted under the Plan shall be subject to the following
terms and conditions:
(a) Except as provided in Subsection 6(j), the option price per Share
shall be determined by the Committee, but (i) as to an ISO shall not be less
than 100% of the Fair Market Value of a Share on the date such ISO option is
granted; and (ii) as to an NQO, shall not be less than 75% of the Fair Market
Value of a Share on the date such NQO is granted.
(b) The Committee shall, in its discretion, fix the term of each
option, provided that the maximum length of the term of each option granted
hereunder shall be 10 years and provided further than the provisions of
Subsection 6(j) hereof shall be applicable to the grant of ISOs to Employees
therein identified.
(c) If a holder of an option dies while he is employed by the Company
or a Subsidiary, such option may, to the extent that the holder of the option
was entitled to exercise such option on the date of his death, be exercised
during a period after his death fixed by the Committee, in its discretion, at
the time such option is granted, but in no event to exceed one year, by his
personal representative or representatives or by the person or persons to whom
the holder's rights under the option shall pass by will or by the applicable
laws of descent and distribution or by a qualified domestic relations order;
provided, however, that no option granted under the Plan may be exercised to any
extent by anyone after its expiration.
(d) In the event that a holder of an option shall voluntarily retire or
quit his employment without the written
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<PAGE>
consent of the Company or a Subsidiary or if the Company shall terminate the
employment of a holder of an option for cause, the options held by such holder
shall forthwith terminate. If a holder of an option shall voluntarily retire or
quit his employment with the written consent of the Company or a Subsidiary, or
if the employment of such holder shall have been terminated by the Company or a
Subsidiary for reasons other than cause, such holder may (unless his option
shall have previously expired pursuant to the provisions hereof) exercise his
option at any time prior to the first to occur of the expiration of the original
option period or the expiration of a period after termination of employment
fixed by the Committee, in its discretion, at the time the option is granted,
but in no event to exceed three months, to the extent of the number of Shares
subject to such option which were purchasable by him on the date of termination
of his employment. Options granted under the Plan shall not be affected by any
change of employment so long as the holder thereof continues to be an Employee.
(e) Anything to the contrary contained herein or in any option
agreement executed and delivered hereunder, no option shall be exercisable
unless and until the Plan has been approved by stockholders of the Company in
accordance with Section 13 hereof.
(f) Each option shall be nonassignable and nontransferable by the
option holder otherwise than by will or by the laws of descent and distribution
and shall be exercisable during the lifetime of the option holder solely by him.
(g) An option holder desiring to exercise an option shall exercise such
option by delivering to the Company written notice of such exercise, specifying
the number of Shares to be purchased, together with payment of the purchase
price therefor; provided, however that no option may be exercised in part with
respect to fewer than 100 Shares, except to purchase the remaining Shares
purchasable under such option. Payment shall be made as follows: (i) in United
States dollars by cash or by check, certified check, bank draft or money order
payable to the order of the Company; (ii) at the discretion of the Committee, by
delivering to the Company Shares already owned by the option holder and having a
Fair Market Value on the date of exercise equal to the exercise price, or a
combination of such Shares and cash; or (iii) by any other proper method
specifically approved by the Committee.
(h) In order to assist an option holder with the acquisition of Shares
pursuant to the exercise of an option granted under the Plan, the Committee may,
in its discretion and subject to the requirements of applicable statutes, rules
and regulations, whenever, in its judgment, such assistance may reasonably be
expected to benefit the Company, authorize, either at the time of the grant of
the option or thereafter (i) the extension of a loan to the option holder by the
Company, (ii) the payment by the option
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holder of the purchase price of the Shares in installments, or (iii) the
guaranty by the Company of a loan obtained by the option holder from a third
party. The Committee shall determine the terms of any such loan, installment
payment arrangement or guaranty, including the interest rate and other terms of
repayment thereof. Loans, installment payment arrangements and guaranties may be
authorized with or without security and the maximum amount thereof shall be the
option price for the Shares being acquired plus related interest payments.
(i) The aggregate Fair Market Value (determined at the time an ISO is
granted) of the Shares as to which an Employee may first exercise ISOs in any
one calendar year under all incentive stock option plans of the Company and its
Subsidiaries may not exceed $100,000.
(j) An ISO may be granted to an Employee owning, or who is considered
as owning by applying the rules of ownership set forth in Section 425(d) of the
Code, over 10% of the total combined voting power of all classes of stock of the
Company or any Subsidiary if the option price of such ISO equals or exceeds 110%
of the Fair Market Value of a Share on the date the option is granted and such
ISO shall expire not more than five years after the date of grant.
7. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
(a) Subject to any required regulatory approval, new option rights may
be substituted for the option rights granted under the Plan, or the Company's
duties as to options outstanding under the Plan may be assumed, by a corporation
other than the Company, or by a parent or subsidiary of the Company or such
corporation, in connection with any merger, consolidation, acquisition,
separation, reorganization, liquidation or like occurrence in which the Company
is involved. Notwithstanding the foregoing or the provisions of Subsection 7(b)
hereof, in the event such corporation, or parent or subsidiary of the Company or
such corporation, does not substitute new option rights for, and substantially
equivalent to, the option rights granted hereunder, or assume the option rights
granted hereunder, the option rights granted hereunder shall terminate and
thereupon become null and void (i) upon dissolution or liquidation of the
Company, or similar occurrence, (ii) upon any merger, consolidation,
acquisition, separation, reorganization, or similar occurrence, in which the
Company will not be a surviving entity or (iii) upon a transfer of substantially
all of the assets of the Company or more than 80% of the outstanding Shares;
provided, however, that each option holder shall have the right immediately
prior to or concurrently with such dissolution, liquidation, merger,
consolidation, acquisition, separation, reorganization or similar occurrence, to
exercise any unexpired option rights granted hereunder whether or not then
exercisable. If the exercise of the foregoing right by the holder
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of an ISO would be deemed to result in a violation of the provisions of
Subsection 6(i) of the Plan, then, without further act on the part of the
Committee or the option holder, such ISO shall be deemed an NQO to the extent
necessary to avoid any such violation.
(b) The existence of outstanding options shall not affect in any way
the right or power of the Company or its stockholders to make or authorize any
or all adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, or any merger or consolidation of
the Company, or any issuance of Common Stock or subscription rights or any
merger or consolidation of the Company, or any issuance of bonds, debentures,
preferred or prior preference stock ahead of or affecting the Shares or the
rights thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar character or otherwise; provided,
however, that if the outstanding Shares shall at any time be changed or
exchanged by declaration of a stock dividend, stock split, combination of shares
or recapitalization, the number and kind of Shares subject to the Plan or
subject to any options theretofore granted, and the option prices, shall be
appropriately and equitably adjusted so as to maintain the proportionate number
of Shares without changing the aggregate option price.
(c) Adjustments under this Section 7 shall be made by the Committee
whose determination as to what adjustments, if any, shall be made, and the
extent thereof, shall be final.
8. PRIVILEGES OF STOCK OWNERSHIP
No option holder shall be entitled to the privileges of stock ownership
as to any Shares not actually issued and delivered to him.
9. SECURITIES REGULATION
(a) Each option shall be subject to the requirement that if at any time
the Board of Directors or Committee shall in its discretion determine that the
listing, registration or qualification of the Shares subject to such option upon
any securities exchange or under any Federal or state law, or the approval or
consent of any governmental regulatory body, is necessary or desirable in
connection with the issuance or purchase of Shares thereunder, such option may
not be exercised in whole or in part unless such listing, registration,
qualification, approval or consent shall have been effected or obtained free
from any conditions not reasonably acceptable to the Board of Directors or
Committee.
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(b) Unless at the time of the exercise of an option and the issuance of
the Shares thereby purchased by any option holder hereunder there shall be in
effect as to such Shares a Registration Statement under the Securities Act and
the rules and regulations of the Securities and Exchange Commission, or there
shall be available an exemption from the registration requirements of the
Securities Act, the option holder exercising such option shall deliver to the
Company at the time of exercise a certificate (i) acknowledging that the Shares
so acquired may be "restricted securities" within the meaning of Rule 144
promulgated under the Securities Act, (ii) certifying that he is acquiring the
Shares issuable to him upon such exercise for the purpose of investment and not
with a view to their sale or distribution; and (iii) containing such option
holder's agreement that such Shares may not be sold or otherwise disposed of
except in accordance with applicable provisions of the Securities Act. The
Company shall not be required to issue or deliver certificates for Shares until
there shall have been compliance with all applicable laws, rules and
regulations, including the rules and regulations of the Securities and Exchange
Commission.
10. EMPLOYMENT OF EMPLOYEE
Nothing contained in the Plan or in any option agreement executed and
delivered thereunder shall confer upon any option holder any right to continue
in the employ of the Company or any Subsidiary or to interfere with the right of
the Company or any Subsidiary to terminate such employment at any time.
11. WITHHOLDING; DISQUALIFYING DISPOSITION
(a) The Company shall deduct and withhold from any salary or other
compensation for employment services of an option holder, all amounts required
to satisfy withholding tax liabilities arising from the grant or exercise of an
option under the Plan or the acquisition or disposition of Shares acquired upon
exercise of any such option.
(b) In the discretion of the Committee and in lieu of the deduction and
withholding provided for in subsection (a) above, the Company shall deduct and
withhold Shares otherwise issuable to the option holder having a fair market
value on the date income is recognized pursuant to the exercise of an option
equal to the amount required to be withheld.
(c) In the case of disposition by an option holder of Shares acquired
upon exercise of an ISO within (i) two years after the date of grant of such
ISO, or (ii) one year after the transfer of such Shares to such option holder,
such option holder shall give written notice to the Company of such disposition
not later than 30 days after the occurrence thereof, which notice shall include
all such information as may be required by the Company to comply with
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applicable provisions of the Code and shall be in such form as the Company shall
from time to time determine.
12. AMENDMENT, SUSPENSION AND TERMINATION OF THE PLAN
Subject to any required regulatory approval, the Board of Directors or
Committee may at any time amend, suspend or terminate the Plan, provided that,
except as set forth in Section 7 above, no amendment may be adopted without the
approval of stockholders which would:
(a) increase the number of Shares which may be issued pursuant to the
exercise of options granted under the Plan;
(b) permit the grant of an option under the Plan with an option price
less than 100% of the Fair Market Value of the Shares at the time such option is
granted;
(c) change the provisions of Section 4;
(d) extend the term of an option or the period during which an option
may be granted under the Plan; or
(e) decrease an option exercise price (provided that the foregoing does
not preclude the cancellation of an option and a new grant at a lower exercise
price without stockholder approval).
Unless the Plan shall theretofore have been terminated by the Board of Directors
or Committee, the Plan shall terminate on November __, 2005. No option may be
granted during the term of any suspension of the Plan or after termination of
the Plan. The amendment or termination of the Plan shall not, without the
written consent of the option holder to be affected, alter or impair any rights
or obligations under any option theretofore granted to such option holder under
the Plan.
13. EFFECTIVE DATE
The effective date of the Plan shall be November 7, 1995, subject to
its approval by shareholders of the Company not later than November 7, 1996.
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EXHIBIT 4(b)
NUCO2 INC.
DIRECTORS' STOCK OPTION PLAN
ARTICLE I
PURPOSE
The purpose of Fowler Carbonics, Inc. Directors' Stock Option Plan (the
"Plan") is to secure for Fowler Carbonics, Inc. and its shareholders the
benefits arising from stock ownership by its Directors. The Plan will provide a
means whereby such Directors may purchase shares of the common stock, $.05 par
value, of Fowler Carbonics, Inc. pursuant to options granted in accordance with
the Plan.
ARTICLE II
DEFINITIONS
The following capitalized terms used in the Plan shall have the
respective meanings set forth in this Article:
2.1 "BOARD" shall mean the Board of Directors of Fowler Carbonics, Inc.
2.2 "CODE" shall mean the Internal Revenue Code of 1986, as amended.
2.3 "COMPANY" shall mean Fowler Carbonics, Inc. and any of its
Subsidiaries.
2.4 "DIRECTOR" shall mean any person who is a member of the Board of
Directors of the Company.
2.5 "ELIGIBLE DIRECTOR" shall be any Director who is not a full or
part-time Employee of the Company.
2.6 "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
2.7 "EXERCISE PRICE" shall mean the price per Share at which an Option
may be exercised.
2.8 "FAIR MARKET VALUE" of the Shares means the closing price of
publicly traded Shares on the national securities exchange on which the Shares
are listed on the day before the Grant Date (if the Shares are so listed) or on
the Nasdaq National Market on the day before the Grant Date (if the Shares are
regularly quoted on the Nasdaq National Market), or, if not so listed or
regularly
<PAGE>
quoted, the mean between the closing bid and asked prices of publicly traded
Shares in the over-the-counter market on the day before the Grant Date, or, if
such bid and asked prices shall not be available, as reported by any nationally
recognized quotation service selected by the Company on the day before the Grant
Date, or as determined by the Board in a manner consistent with the provisions
of the Code.
2.9 "GRANT DATE" shall mean the Initial Grant Date and any Subsequent
Grant Date.
2.10 "INITIAL GRANT DATE" shall mean with respect to each Eligible
Director the date such Eligible Director is first elected as a member of the
Board, or if an Eligible Director is a member of the Board the date the Board
approved the Plan.
2.11 "OPTION" shall mean an Option to purchase Shares granted pursuant
to the Plan.
2.12 "OPTION AGREEMENT" shall mean the written agreement described in
Article VI herein.
2.13 "PERMANENT DISABILITY" shall mean the condition of an Eligible
Director who is unable to participate as a member of the Board by reason of any
medically determined physical or mental impairment that can be expected to
result in death or which can be expected to last for a continuous period of not
less than 12 months.
2.14 "PURCHASE PRICE" shall be the Exercise Price multiplied by the
number of whole Shares with respect to an Option may be exercised.
2.15 "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended.
2.16 "SHARES" shall mean shares of common stock, $.05 par value, of the
Company.
2.17 "SUBSEQUENT GRANT DATE" shall mean any Grant Date other than the
Initial Grant Date.
2.18 "SUBSIDIARIES" shall have the meaning provided in Section 425(f)
of the Code.
ARTICLE III
ADMINISTRATION
3.1 GENERAL. This Plan shall be administered by the Board in accordance
with the express provisions of this Plan.
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3.2 POWERS OF THE BOARD. The Board shall have full and complete
authority to adopt such rules and regulations and to make all such other
determinations not inconsistent with the Plan as may be necessary for the
administration of the Plan.
ARTICLE IV
SHARES SUBJECT TO PLAN
Subject to adjustment in accordance with Article IX, an aggregate of
60,000 Shares is reserved for issuance under this Plan. Shares sold under this
Plan may be either authorized but unissued Shares or reacquired Shares. If an
Option, or any portion thereof, shall expire or terminate for any reason without
having been exercised in full, the unpurchased Shares covered by such Option
shall be available for future grants of Option.
ARTICLE V
GRANTS
5.1 INITIAL GRANTS. On the Initial Grant Date, each Eligible Director
shall receive the grant of an option to purchase 6,000 Shares. If an Eligible
Director was granted an option as of the date the Board approved the Plan, then
such grant is subject to shareholder approval of the Plan.
5.2 SUBSEQUENT GRANTS. To the extent that Shares remain available for
the grant of Options under the Plan, on the third anniversary of the Initial
Grant Date, and on each three year anniversary thereafter, each Eligible
Director shall be granted an Option to purchase an additional 6,000 Shares.
5.3 ADJUSTMENT OF GRANTS. The number of Shares set forth in Section 5.1
and 5.2 as to which Options shall be granted shall be subject to adjustment as
provided in section 9.1 hereof.
5.4 COMPLIANCE WITH RULE 16B-3. The terms for the grant of Options to
an Eligible Director may only be changed if permitted under Rule 16b-3 under the
Exchange Act and, accordingly, the formula for the grant of Options may not be
changed or otherwise modified more than once in any six month period, other than
to comport with changes in the Code, the employee Retirement Income Security
Act, or the rules and regulations thereunder.
ARTICLE VI
TERMS OF OPTION
Each Option shall be evidenced by a written Option Agreement executed
by the Company and the Eligible Director which shall specify the Grant Date, the
number of Shares subject to the Option,
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the Exercise Price and shall also include or incorporate by reference the
substance of all of the following provisions and such other provisions
consistent with this Plan as the Board may determine.
6.1 TERM. The term of each Option shall be 10 years from the Grant Date
thereof, subject to earlier termination in accordance with Articles VI and X.
6.2 RESTRICTION ON EXERCISE. Options shall be exercisable in three
equal installments beginning on the first anniversary of the Initial Grant Date
or any Subsequent Grant Date and subject to such terms and conditions as shall
be determined by the Board at grant, provided, however, that in the case of the
Eligible Director's death or Permanent Disability, the Options held by him will
become immediately exercisable, unless a longer vesting period is otherwise
determined by the Board at grant. The Board may waive any installment exercise
provision at any time in whole or in part based on performance and/or such other
factors as the Board may determine in its sold discretion, provided, however,
that no Option shall be exercisable until more than six months have elapsed from
the Grant Date and; provided, further that no Option will be exercisable until
shareholder approval of the Plan shall have been obtained.
6.3 EXERCISE PRICE. The Exercise Price for each Share subject to an
Option shall be the Fair Market Value of the Share as determined in Section 2.8
herein.
6.4 MANNER OF EXERCISE. An Option shall be exercised in accordance with
its terms, by delivery of a written notice of exercise to the Company, and
payment of the full purchase price of the Shares being purchased. An Eligible
Director may exercise an Option with respect to all or less than all of the
Shares for which the Option may then be exercised, but a Director must exercise
the Option in full Shares.
6.5 PAYMENT. The Purchase Price of Shares purchased pursuant to an
Option or portion thereof, may be paid:
(a) in United States Dollars, in cash or by check, bank draft or
money order payable to the Company;
(b) at the discretion of the Board by delivery of Shares already
owned by an Eligible Director with an aggregate Fair Market Value
on the date of exercise equal to the Purchase Price, subject to the
provisions of Section 16(b) of the Exchange Act; and
(c) through the written election of the Eligible Director to have
Shares withheld by the Company from the Shares otherwise to be
received with such withheld Shares
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having an aggregate Fair Market Value on the date of exercise equal
to the Purchase Price.
6.6 TRANSFERABILITY. No Option shall be transferable otherwise than by
will or the laws of descent and distribution, and an Option shall be exercisable
during the Eligible Director's lifetime only by the Eligible Director, his
guardian or legal representative.
6.7 TERMINATION OF MEMBERSHIP ON THE BOARD. If an Eligible Director's
membership on the Board terminates for any reason other than cause, including
the death of an Eligible Director, an Option held on the date of termination may
be exercised in whole or in part at any time within one (1) year after the date
of such termination (but in no event after the term of the Option expires) and
shall thereafter terminate. If an Eligible Director's membership on the Board is
terminated for cause, which determination shall be made by the Board, Options
held by him shall terminate concurrently with termination of membership.
ARTICLE VII
GOVERNMENT AND OTHER REGULATIONS
7.1 DELIVERY OF SHARES. The obligation of the Company to issue or
transfer and deliver Shares for exercised Options under the Plan shall be
subject to all applicable laws, regulations, rules, orders and approvals which
shall then be in effect.
7.2 HOLDING OF STOCK AFTER EXERCISE OF OPTION. The Option Agreement
shall provide that the Eligible Director, by accepting such Option, represents
and agrees, for the Eligible Director and his permitted transferees hereunder
that none of the Shares purchased upon exercise of the Option shall be acquired
with a view to any sale, transfer or distribution of the Shares in violation of
the Securities Act and the person exercising an Option shall furnish evidence
satisfactory to that Company to that effect, including an indemnification of the
Company in the event of any violation of the Act by such person. Notwithstanding
the foregoing, the Company in its sole discretion may register under the Act the
Shares issuable upon exercise of the Options under the Plan.
ARTICLE VIII
WITHHOLDING TAX
The Company may in its discretion, require an Eligible Director to pay
to the Company, at the time of exercise of an Option an amount that the Company
deems necessary to satisfy its obligations to withhold federal, state or local
income or other taxes (which for purposes of this Article includes an Eligible
A-5
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Director's FICA obligation) incurred by reason of such exercise. When the
exercise of an Option does not give rise to the obligation to withhold federal
income taxes on the date of exercise, the Company may, in its discretion,
require an eligible Director to place Shares purchased under the Option in
escrow for the benefit of the Company until such time as federal income tax
withholding is required on amounts included in the Eligible Director's gross
income as a result of the exercise of an Option. At such time, the Company, in
its discretion, may require an Eligible Director to pay to the Company an amount
that the Company deems necessary to satisfy its obligation to withhold federal,
state or local taxes incurred by reason of the exercise of the Option, in which
case the Shares will be released from escrow upon such payment by an Eligible
Director.
ARTICLE IX
ADJUSTMENT
9.1 PROPORTIONATE ADJUSTMENTS. If the outstanding Shares are increased,
decreased, changed into or exchanged into a different number of kind of Shares
or securities of the Company through reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
similar transaction, an appropriate and proportionate adjustment shall be made
to the maximum number and kind of Shares as to which Options may be granted
under this Plan. A corresponding adjustment changing the number or kind of
Shares allocated to unexercised Options or portions thereof, which shall have
been granted prior to any such change, shall likewise be made. Any such
adjustment in the outstanding Options shall be made without change in the
Purchase Price applicable to the unexercised portion of the Option with a
corresponding adjustment in the Exercise Price of the Shares covered by the
Option. Notwithstanding the foregoing, there shall be no adjustment for the
adjustment for the issuance of Shares on conversion of notes, preferred stock or
exercise of warrants or Shares issued by the Board for such consideration as the
Board deems appropriate.
9.2 DISSOLUTION OR LIQUIDATION. Upon the dissolution or liquidation of
the Company, or upon a reorganization, merger or consolidation of the Company
with one or more corporations as a result of which the Company is not the
surviving corporation, or upon a sale of substantially all of the property or
more than 80% of the then outstanding Shares of the Company to another
corporation, the Company shall give to each Eligible Director at the time of
adoption of the plan for liquidation, dissolution, merger or sale either (1) a
reasonable time thereafter within which to exercise the Option prior to the
effective date of such liquidation or dissolution, merger or sale, or (2) the
right to exercise the Option as to an equivalent number of Shares of stock of
the corporation succeeding the Company or acquiring its business
A-6
<PAGE>
by reason of such liquidation, dissolution, merger, consolidation or
reorganization.
ARTICLE X
AMENDMENT OR TERMINATION OF PLAN
10.1 AMENDMENTS. The Board may at any time amend or revise the terms of
the Plan, provided no such amendment or revision shall, unless appropriate
shareholder approval of such amendment or revision is obtained:
(a) increase the maximum number of Shares which may be sold
pursuant to Options granted under the Plan, except as
permitted under the provisions of Article IX;
(b) change the minimum Exercise Price set forth in Article VI;
(c) increase the maximum term of Options provided for in
Article VI; or
(d) permit the granting of Options to anyone other than as
provided in Article V.
10.2 TERMINATION. The Board at any time may suspend or terminate this
Plan. This Plan, unless sooner terminated, shall terminate on the tenth (10th)
anniversary of its adoption by the Board. Termination of the Plan shall not
affect Options previously granted thereunder. No Option may be granted under
this Plan while this Plan is suspended or after it is terminated.
10.3 CONSENT OF HOLDER. No amendment, suspension or termination of the
Plan shall, without the consent of the holder of Options, alter or impair any
rights or obligations under any Option theretofore granted under the Plan.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 PRIVILEGE OF STOCK OWNERSHIP. No Eligible Director entitled to
exercise any Option granted under the Plan shall have any of the rights or
privileges of a shareholder of the Company with respect to any Shares issuable
upon exercise of an Option until certificates representing the Shares shall have
been issued and delivered.
11.2 PLAN EXPENSES. Any expenses incurred in the administration of the
Plan shall be borne by the Company.
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11.3 USE OF PROCEEDS. Payments received from an Eligible Director upon
the exercise of Options shall be used for general corporate purposes of the
Company.
11.4 GOVERNING LAW. The Plan has been adopted under the laws of the
State of Florida. The Plan and all Options which may be granted hereunder and
all matters related thereto, shall be governed by and construed and enforceable
in accordance with the laws of the State of Florida as it then exists.
ARTICLE XII
SHAREHOLDER APPROVAL
This Plan is subject to approval, at a duly held shareholders' meeting
within 12 months after the date the Board approves this Plan, by the affirmative
vote of holders of a majority of the voting Shares of the Company represented in
person or by proxy and entitled to vote at the meeting. Options may be granted,
but not exercised, before such shareholder approval is obtained. If the
shareholders fail to approve the Plan within the required time period, any
Options granted under this Plan shall be void, and no additional Options may
thereafter be granted.
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EXHIBIT 4(c)
FOWLER CARBONICS, INC.
2820 Southeast Market Place
Stuart, Florida 34997
As of June 7, 1995
To: Jean Houghton
2820 Southeast Market Place
Stuart, Florida 34997
We are pleased to inform you that as of June 7, 1995, the Board of
Directors of Fowler Carbonics, Inc. (the "Company") granted you a stock option
to purchase 8.79 shares (the "Shares") of Common Stock, par value $.05 per
share, of the Company, at a price of $17,010.40 per Share.
No portion of the option is currently exercisable. The option may be
exercised after June 7, 1996 and prior to June 8, 2005, on which date the option
will, to the extent not previously exercised, expire. You must purchase a
minimum of 100 Shares each time you choose to purchase Shares, except to
purchase the remaining Shares available to you.
Unless at the time of the exercise of this option a registration
statement under the Securities Act of 1933, as amended (the "Act"), is in effect
as to such Shares, any Shares purchased by you upon the exercise of this option
shall be acquired for investment and not for sale or distribution, and if the
Company so requests, upon any exercise of this option, in whole or in part, you
will execute and deliver to the Company a certificate to such effect. The
Company shall not be obligated to issue any Shares pursuant to this option if,
in the opinion of counsel to the Company, the Shares to be so issued are
required to be registered or otherwise qualified under the Act or under any
other applicable statute, regulation or ordinance affecting the sale of
securities, unless and until such Shares have been so registered or otherwise
qualified.
You understand and acknowledge that, under existing law, unless at the
time of the exercise of this option a registration statement under the Act is in
effect as to such Shares (i) any Shares purchased by you upon exercise of this
option may be required to be held indefinitely unless such Shares are
subsequently registered under the Act or an exemption from such registration is
available; (ii) any sales of such Shares
<PAGE>
made in reliance upon Rule 144 promulgated under the Act may be made only in
accordance with the terms and conditions of that Rule (which, under certain
circumstances, restrict the number of shares which may be sold and the manner in
which shares may be sold); (iii) in the case of securities to which Rule 144 is
not applicable, compliance with Regulation A promulgated under the Act or some
other disclosure exemption will be required; (iv) certificates for Shares to be
issued to you hereunder shall bear a legend to the effect that the Shares have
not been registered under the Act and that the Shares may not be sold,
hypothecated or otherwise transferred in the absence of an effective
registration statement under the Act relating thereto or an opinion of counsel
satisfactory to the Company that such registration is not required; (v) the
Company will place an appropriate "stop transfer" order with its transfer agent
with respect to such Shares; and (vi) the Company has undertaken no obligation
to register the Shares or to include the Shares in any registration statement
which may be filed by it subsequent to the issuance of the shares to you. In
addition, you understand and acknowledge that the Company has no obligation to
you to furnish information necessary to enable you to make sales under Rule 144.
This option (or installment thereof) is to be exercised by delivering
to the Company a written notice of exercise in the form attached hereto as
Exhibit A, specifying the number of Shares to be purchased, together with
payment of the purchase price of the Shares to be purchased. The purchase price
is to be paid in cash or as otherwise determined by the Board of Directors.
Would you kindly evidence your acceptance of this option and your
agreement to comply with the provisions hereof by executing this letter under
the words "Agreed To and Accepted."
Very truly yours,
FOWLER CARBONICS, INC.
By:/s/ Edward M. Sellian
-------------------------------------
Edward M. Sellian, Chairman of
the Board
AGREED TO AND ACCEPTED:
/s/ Jean Houghton
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Jean Houghton
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<PAGE>
EXHIBIT A
Fowler Carbonics, Inc.
2820 Southeast Market Place
Stuart, Florida 34997
Ladies and Gentlemen:
Notice is hereby given of my election to purchase _____ shares of
Common Stock, $.05 par value (the "Shares"), of Fowler Carbonics, Inc., at a
price of $ per Share, pursuant to the provisions of the incentive stock option
granted to me as of June 7, 1995. Enclosed in payment for the Shares is:
/ / my check in the amount of $________.
The following information is supplied for use in issuing and
registering the Shares purchased hereby:
Number of Certificates
and Denominations ___________________
Name ___________________
Address ___________________
___________________
Social Security Number ___________________
Dated: _______________, ____
Very truly yours,
--------------------------
Jean Houghton
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EXHIBIT 4(d)
FOWLER CARBONICS, INC.
2820 Southeast Market Place
Stuart, Florida 34997
As of June 7, 1995
To: Robert Ranieri
2820 Southeast Market Place
Stuart, Florida 34997
We are pleased to inform you that as of June 7, 1995, the Board of
Directors of Fowler Carbonics, Inc. (the "Company") granted you a stock option
to purchase 8.79 shares (the "Shares") of Common Stock, par value $.05 per
share, of the Company, at a price of $17,010.40 per Share.
No portion of the option is currently exercisable. The option may be
exercised after June 7, 1996 and prior to June 8, 2005, on which date the option
will, to the extent not previously exercised, expire. You must purchase a
minimum of 100 Shares each time you choose to purchase Shares, except to
purchase the remaining Shares available to you.
Unless at the time of the exercise of this option a registration
statement under the Securities Act of 1933, as amended (the "Act"), is in effect
as to such Shares, any Shares purchased by you upon the exercise of this option
shall be acquired for investment and not for sale or distribution, and if the
Company so requests, upon any exercise of this option, in whole or in part, you
will execute and deliver to the Company a certificate to such effect. The
Company shall not be obligated to issue any Shares pursuant to this option if,
in the opinion of counsel to the Company, the Shares to be so issued are
required to be registered or otherwise qualified under the Act or under any
other applicable statute, regulation or ordinance affecting the sale of
securities, unless and until such Shares have been so registered or otherwise
qualified.
You understand and acknowledge that, under existing law, unless at the
time of the exercise of this option a registration statement under the Act is in
effect as to such Shares (i) any Shares purchased by you upon exercise of this
option may be required to be held indefinitely unless such Shares are
subsequently registered under the Act or an exemption from such registration is
available; (ii) any sales of such Shares made in
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reliance upon Rule 144 promulgated under the Act may be made only in accordance
with the terms and conditions of that Rule (which, under certain circumstances,
restrict the number of shares which may be sold and the manner in which shares
may be sold); (iii) in the case of securities to which Rule 144 is not
applicable, compliance with Regulation A promulgated under the Act or some other
disclosure exemption will be required; (iv) certificates for Shares to be issued
to you hereunder shall bear a legend to the effect that the Shares have not been
registered under the Act and that the Shares may not be sold, hypothecated or
otherwise transferred in the absence of an effective registration statement
under the Act relating thereto or an opinion of counsel satisfactory to the
Company that such registration is not required; (v) the Company will place an
appropriate "stop transfer" order with its transfer agent with respect to such
Shares; and (vi) the Company has undertaken no obligation to register the Shares
or to include the Shares in any registration statement which may be filed by it
subsequent to the issuance of the shares to you. In addition, you understand and
acknowledge that the Company has no obligation to you to furnish information
necessary to enable you to make sales under Rule 144.
This option (or installment thereof) is to be exercised by delivering
to the Company a written notice of exercise in the form attached hereto as
Exhibit A, specifying the number of Shares to be purchased, together with
payment of the purchase price of the Shares to be purchased. The purchase price
is to be paid in cash or as otherwise determined by the Board of Directors.
Would you kindly evidence your acceptance of this option and your
agreement to comply with the provisions hereof by executing this letter under
the words "Agreed To and Accepted."
Very truly yours,
FOWLER CARBONICS, INC.
By:/s/ Edward M. Sellian
---------------------------------
Edward M. Sellian, Chairman of
the Board
AGREED TO AND ACCEPTED:
/s/ Robert Ranieri
- ------------------------
Robert Ranieri
-2-
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EXHIBIT A
Fowler Carbonics, Inc.
2820 Southeast Market Place
Stuart, Florida 34997
Ladies and Gentlemen:
Notice is hereby given of my election to purchase _____ shares of
Common Stock, $.05 par value (the "Shares"), of Fowler Carbonics, Inc., at a
price of $ per Share, pursuant to the provisions of the incentive stock option
granted to me as of June 7, 1995. Enclosed in payment for the Shares is:
/ / my check in the amount of $________.
The following information is supplied for use in issuing and
registering the Shares purchased hereby:
Number of Certificates
and Denominations ___________________
Name ___________________
Address ___________________
___________________
Social Security Number ___________________
Dated: _______________, ____
Very truly yours,
--------------------------
Robert Ranieri
-3-
EXHIBIT 5
OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
505 PARK AVENUE
NEW YORK, NEW YORK 10022
(212) 753-7200
June 24, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549
Re: NUCO2 INC.
REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-8 dated the
date hereof (the "Registration Statement"), filed with the Securities and
Exchange Commission by NuCo2 Inc., a Florida corporation (the "Company"). The
Registration Statement relates to an aggregate of 477,934 shares (the "Shares")
of common stock, par value $.001 per share (the "Common Stock"). The Shares will
be issued and sold by the Company in accordance with certain employee benefit
plans (as defined in Rule 405 of Regulation C promulgated under the Securities
Act of 1933, as amended) (each a "Plan") of the Company.
We advise you that we have examined originals or copies certified or
otherwise identified to our satisfaction of the Certificate of Incorporation and
Bylaws of the Company, minutes of meetings of the Board of Directors and
stockholders of the Company, the Plans, the documents to be sent or given to
participants in the Plans and such other documents, instruments and certificates
of officers and representatives of the Company and public officials, and we have
made such examination of the law, as we have deemed appropriate as the basis for
the opinion hereinafter expressed. In making such examination, we have assumed
the genuineness of all
<PAGE>
Securities and Exchange Commission
June 24, 1996
Page -2-
signatures, the authenticity of all documents submitted to us as originals, and
the conformity to original documents of documents submitted to us as certified
or photostatic copies.
Based upon the foregoing, we are of the opinion that the Shares, when
issued and paid for in accordance with the terms and conditions described in the
relevant Plan, will be duly and validly issued, fully paid and non-assessable.
We advise you that Robert L. Frome, a director of the Company, is a
shareholder of the Company and a member of this firm. Other members of the firm
are also shareholders of the Company.
We consent to the reference to this firm under the caption "Legal
Opinion" in the Prospectuses.
Very truly yours,
/S/ OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
------------------------------------------
OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
EXHIBIT 23(b)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
NuCo2 Inc.
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG Peat Marwick LLP
-------------------------
KPMG PEAT MARWICK LLP
West Palm Beach, Florida
June 21, 1996
EXHIBIT 23(c)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement of NuCo2 Inc. on Form S-8 of our report dated November 16, 1994,
appearing in the Registration Statement on Form SB-2 of NuCo2 Inc. filed on June
7, 1996 and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
/s/ Cooper, Selvin & Strassberg LLP
------------------------------------
COOPER, SELVIN & STRASSBERG LLP
Great Neck, New York
June 21, 1996
