<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________________
TENNANT COMPANY
(Exact name of Registrant as specified in its charter)
Minnesota 41-0572550
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
701 North Lilac Drive
P.O. Box 1452
Minneapolis, Minnesota 55440
(Address of Principal Executive Offices) (Zip Code)
1995 STOCK INCENTIVE PLAN
(Full title of the plan)
Roger L. Hale, President and Chief Executive Officer
Tennant Company
701 North Lilac Drive
P.O. Box 1452
Minneapolis, Minnesota 55440
(Name and address of agent for service)
(612) 540-1200
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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<S> <C> <C> <C> <C>
Amount Proposed maximum Proposed maximum Amount of
Title of securities to be offering price aggregate offering registration
to be registered registered per share (1) price (1) fee
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock,
$0.375 par value (including preferred 250,000 $25.875 $6,468,750 $2,230
share purchase rights) Shares
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(h) under the Securities Act of 1933, based on the average
of the high and low sale prices per share of the Registrant's Common Stock as
reported on the National Association of Securities Dealers Automated Quotation
System on August 16, 1995.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, previously filed (File No. 0-4804) with the
Securities and Exchange Commission (the "Commission") pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act"), are, as of their respective dates,
incorporated in this Registration Statement by reference and made a part hereof:
(1) The latest Annual Report on Form 10-K of Tennant Company (the
"Company") filed pursuant to Section 13(a) or 15(d) of the
Exchange Act;
(2) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the
Annual Report referred to in (1) above;
(3) The description of the Company's Common Stock contained in a
registration statement filed pursuant to the Exchange Act,
including any amendment or report filed for the purpose of
updating such description; and
(4) The Company's Registration Statement on Form 8-A filed on
April 27, 1987 for the registration of Preferred Share Purchase
Rights (including the Rights Agreement filed as an Exhibit
thereto), and all amendments filed with respect thereto.
All documents filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date of
this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all of the shares of Common Stock offered have
been sold or which deregisters all shares of the Common Stock then remaining
unsold shall be deemed to be incorporated by reference in and a part of this
Registration Statement from the date of filing of such documents.
Any statement contained in a document incorporated, or deemed to be
incorporated, by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or incorporated herein by reference or in any other
subsequently filed document that also is or is deemed to be incorporated by
reference herein 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 Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VI of the Company's Restated By-Laws provides that the Company
shall indemnify its directors and officers to the full extent required by
Minnesota Statutes, Section 302A.521, or by other provisions of law.
Section 302A.521 requires the Company to indemnify a person made or threatened
to be made a party to a proceeding by reason of the former or present official
capacity of the person with respect to the Company against judgments, penalties,
fines, including, without limitation, excise taxes assessed against the person
with respect to an
<PAGE>
employee benefit plan, settlements, and reasonable expenses, including
attorneys' fees and disbursements, if, with respect to the acts or omissions of
the person complained of in the proceeding, such person (1) has not been
indemnified by another organization or employee benefit plan for the same
judgments, penalties, fines, including, without limitation, excise taxes
assessed against the person with respect to an employee benefit plan,
settlements, and reasonable expenses, including attorneys' fees and
disbursements, incurred by the person in connection with the proceeding with
respect to the same acts or omissions, (2) acted in good faith, (3) received no
improper personal benefit, and statutory procedure has been followed in the
case of any conflict of interest by a director, (4) in the case of a criminal
proceeding, had no reasonable cause to believe the conduct was unlawful, and
(5) in the case of acts or omissions occurring in the person's performance in
the official capacity of director or, for a person not a director, in the
official capacity of officer, committee member, employee or agent, reasonably
believed that the conduct was in the best interests of the Company, or, in the
case of performance by a director, officer, employee or agent of the Company as
a director, officer, partner, trustee, employee or agent of another organization
or employee benefit plan, reasonably believed that the conduct was not opposed
to the best interests of the Company. In addition, Section 302A.521, subd. 3,
requires payment by the Company, upon written request, of reasonable expenses in
advance of final disposition in certain instances. A decision as to required
indemnification is made by a disinterested majority of the Board of Directors
present at a meeting at which a disinterested quorum is present, or by a
designated committee of disinterested directors, by special legal counsel, by
the disinterested shareholders, or by a court.
Article VIII of the Company's Restated Articles of Incorporation
provides that no director shall be personally liable to the Company or its
shareholders for monetary damages for breach of fiduciary duty as a director,
except (i) for any breach of the director's duty of loyalty to the Company or
its shareholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for dividends, stock
repurchases and other distributions made in violation of Minnesota law or for
violations of the Minnesota securities laws, (iv) for any transaction from which
the director derived an improper personal benefit, or (v) for any act or
omission occurring prior to the effective date of the provision limiting such
liability in the Company's Restated Articles. This Article does not affect the
availability of equitable remedies, such as an action to enjoin or rescind a
transaction involving a breach of fiduciary duty, although, as a practical
matter, equitable relief may not be available. This Article also does not limit
liability of the directors for violations of, or relieve them from the necessity
of complying with, the federal securities laws.
The Company also maintains a director and officer insurance policy
which insures the Company and its directors and officers against damages,
judgments, settlements and costs incurred by reason of certain acts of such
persons in their capacities as directors and officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit Description
------- -----------
4.1 Restated Articles of Incorporation of the Company, as amended
(1).
4.2 Restated By-Laws of the Company (1).
4.3 Rights Agreement, dated as of December 9, 1986, between Tennant
Company and First Trust Company, Inc. (incorporated herein by
reference, filed as Exhibit 1 to the Company's Current Report on
Form 8-K dated December 22, 1986, File No. 0-4804), as
- ---------------------------
(1) Incorporated herein by reference to the same-numbered Exhibit to the
Company's Registration Statement on Form S-8, File No. 33-59054.
II-2
<PAGE>
amended by an Amendment to Rights Agreement dated as of
August 14, 1990 between Tennant Company and Norwest Bank
Minnesota, National Association, as successor Rights Agent
(incorporated herein by reference, filed as Exhibit 1 to the
Company's Form 8 dated August 21, 1990, File No. 0-4804).
4.4 Tennant Company 1995 Stock Incentive Plan.
5 Opinion of Janet M. Dolan, Senior Vice President and General
Counsel of the Company.
23.1 Consent of KPMG Peat Marwick LLP.
23.2 Consent of Janet M. Dolan, Senior Vice President and General
Counsel of the Company (included in Exhibit 5).
24 Powers of Attorney authorizing Roger L. Hale, Janet M. Dolan
and Bruce J. Borgerding, and each or any of them, to sign
and file this Registration Statement and any amendments and
exhibits thereto on behalf of the directors of the Company.
ITEM 9. UNDERTAKINGS
A. The Company hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; (ii) to reflect in the prospectus any facts or
events arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change in
the information set forth in the Registration Statement;
notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective Registration Statement; and (iii) to include any material
information with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material change to such
information in the Registration Statement; PROVIDED, HOWEVER, that
paragraphs (A)(1)(i) and (A)(1)(ii) do not apply if the Registration
Statement is on Form S-3 or Form S-8, and the information required to
be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each 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 a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
B. The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the
II-3
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Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question 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-4
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Company 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 Minneapolis, State of Minnesota, on the 10th day of
August, 1995.
TENNANT COMPANY
By /s/ Roger L. Hale
------------------------------------
Roger L. Hale, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
/s/ Roger L. Hale President and Chief Executive Officer August 10, 1995
- --------------------- and a Director (Principal Executive
Roger L. Hale Officer)
/s/ Richard A. Snyder Vice President, Treasurer and Chief August 10, 1995
- --------------------- Financial Officer (Principal
Richard A. Snyder Financial Officer)
/s/ Mahedi A. Jiwani Corporate Controller August 10, 1995
- --------------------- (Principal Accounting Officer)
Mahedi A. Jiwani
Arthur D. Collins, Jr. Director )
)
David C. Cox Director )
)
Andrew P. Czajkowski Director ) By /s/ Bruce J. Borgerding
---------------------------
) Attorney-in-Fact
Vernon H. Heath Director )
)
William A. Hodder Director ) August 10, 1995
)
Delbert W. Johnson Director )
)
William I. Miller Director )
)
Arthur R. Schulze, Jr. Director )
)
II-5
<PAGE>
INDEX TO EXHIBITS
Exhibits Page
- -------- ----
4.1 Restated Articles of Incorporation of the Company,
as amended (1).
4.2 Restated By-Laws of the Company (1).
4.3 Rights Agreement, dated as of December 9, 1986,
between Tennant Company and First Trust Company,
Inc. (incorporated herein by reference, filed as
Exhibit 1 to the Company's Current Report on Form
8-K dated December 22, 1986, File No. 0-4804), as
amended by an Amendment to Rights Agreement dated
as of August 14, 1990 between Tennant Company and
Norwest Bank Minnesota, National Association, as
successor Rights Agent (incorporated herein by
reference, filed as Exhibit 1 to the Company's
Form 8 dated August 21, 1990, File No. 0-4804).
4.4 Tennant Company 1995 Stock Incentive Plan. . . . . .Electronic Transmission
5 Opinion of Janet M. Dolan, Senior Vice President
and General Counsel of the Company. . . . . . . . . Electronic Transmission
23.1 Consent of KPMG Peat Marwick LLP . . . . . . . . . Electronic Transmission
23.2 Consent of Janet M. Dolan (included in Exhibit 5).
24 Powers of Attorney. . . . . . . . . . . . . . . . . Electronic Transmission
- -----------------------
(1) Incorporated by reference to the same-numbered Exhibit to the Company's
Registration Statement on Form S-8, File No. 33-59054.
<PAGE>
Exhibit 4.4
TENNANT COMPANY
1995 STOCK INCENTIVE PLAN
(EFFECTIVE FEBRUARY 10, 1995)
1. PURPOSE. The purpose of this 1995 Stock Incentive Plan (the "Plan")
is to motivate key personnel to produce a superior return to the shareholders of
Tennant Company (the "Company") and its Affiliates by offering such individuals
an opportunity to realize Stock appreciation, by facilitating Stock ownership,
and by rewarding them for achieving a high level of corporate performance. This
Plan is also intended to facilitate recruiting and retaining key personnel of
outstanding ability.
2. DEFINITIONS. The capitalized terms used in this Plan have the
meanings set forth below.
(a) "Affiliate" means any corporation that is a "parent corporation"
or "subsidiary corporation" of the Company, as those terms are defined in
Sections 424(e) and (f) of the Code, or any successor provision, and, for
purposes other than the grant of Incentive Stock Options, any joint venture
in which the Company or any such "parent corporation" or "subsidiary
corporation" owns an equity interest.
(b) "Agreement" means a written contract entered into between the
Company or an Affiliate and a Participant containing the terms and
conditions of an Award in such form (not inconsistent with this Plan) as
the Committee approves from time to time, together with all amendments
thereof, which amendments may be unilaterally made by the Company (with the
approval of the Committee) unless such amendments are deemed by the
Committee to be materially adverse to the Participant and are not required
as a matter of law.
(c) "Award" means a grant made under this Plan in the form of
Options, Stock Appreciation Rights, Restricted Stock, Performance Shares or
any Other Stock-Based Award.
(d) "Board" means the Board of Directors of the Company.
(e) "Change in Control" means:
(i) a majority of the directors of the Company shall be persons
other than persons
(A) for whose election proxies shall have been
solicited by the Board or
(B) who are then serving as directors appointed by the
Board to fill vacancies on the Board caused by death or
resignation (but not by removal) or to fill newly-created
directorships,
(ii) 30% or more of the (1) combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of directors ("Outstanding Company
Voting Securities") or (2) the then outstanding Shares of Stock
("Outstanding Company Common Stock") is acquired or beneficially
owned (as defined in Rule 13d-3 under the Exchange Act, or any
successor rule thereto) by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Exchange Act), provided, however, that the following acquisitions
and beneficial ownership shall not constitute Changes in Control
pursuant to this paragraph 2(e)(ii):
(A) any acquisition or beneficial ownership by the
Company or a Subsidiary, or
1
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(B) any acquisition or beneficial ownership by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or one or more of its
Subsidiaries,
(C) any acquisition or beneficial ownership by the
Participant or any group that includes the Participant, or
(D) any acquisition or beneficial ownership by a
Parent or its wholly owned subsidiaries, as long as they
shall remain wholly owned subsidiaries, of 100% of the
Outstanding Company Voting Securities as a result of a
merger or statutory share exchange which complies with
paragraph 2(e)(iii)(A)(2) or the exception in paragraph
2(e)(iii)(B) hereof in all respects,
(iii) the shareholders of the Company approve a definitive
agreement or plan to
(A) merge or consolidate the Company with or into
another corporation (other than (1) a merger or
consolidation with a Subsidiary or (2) a merger in which
(a) the Company is the surviving corporation,
(b) no Outstanding Company Voting Securities or
Outstanding Company Common Stock (other than fractional
shares) held by shareholders of the Company immediately
prior to the merger is converted into cash, securities,
or other property (except (i) voting stock of a Parent
owning directly, or indirectly through wholly owned
subsidiaries, both beneficially and of record 100% of
the Outstanding Company Voting Securities immediately
after the Merger or (ii) cash upon the exercise by
holders of Outstanding Company Voting Securities of
statutory dissenters' rights),
(c) the persons who were the beneficial owners,
respectively, of the Outstanding Company Voting
Securities and Outstanding Company Common Stock
immediately prior to such merger beneficially own,
directly or indirectly, immediately after the merger,
more than 70% of, respectively, the then outstanding
common stock and the voting power of the then
outstanding voting securities of the surviving
corporation or its Parent entitled to vote generally in
the election of directors, and
(d) if voting securities of the Parent are
exchanged for Outstanding Company Voting Securities in
the merger, all holders of any class or series of
Outstanding Company Voting Securities immediately prior
to the merger have the right to receive substantially
the same per share consideration in exchange for their
Outstanding Company Voting Securities as all other
holders of such class or series),
(B) exchange, pursuant to a statutory share exchange,
Outstanding Company Voting Securities of any one or more
classes or series held by shareholders of the Company
immediately prior to the exchange for cash, securities or
other property, except for (a) voting stock of a Parent
owning directly, or indirectly through wholly owned
subsidiaries, both beneficially and of record 100% of the
Outstanding Company Voting Securities immediately after the
statutory share exchange if (i) the persons who were the
beneficial owners, respectively, of the Outstanding Company
Voting Securities and Outstanding Company Common Stock
immediately prior to such statutory share exchange own,
directly or indirectly, immediately after the statutory
share exchange more
2
<PAGE>
than 70% of, respectively, the then outstanding common stock
and the voting power of the then outstanding voting
securities of such Parent entitled to vote generally in the
election of directors, and (ii) all holders of any class or
series of Outstanding Company Voting Securities immediately
prior to the statutory share exchange have the right to
receive substantially the same per share consideration in
exchange for their Outstanding Company Voting Securities as
all other holders of such class or series or (b) cash with
respect to fractional shares of Outstanding Company Voting
Securities or payable as a result of the exercise by holders
of Outstanding Company Voting Securities of statutory
dissenters' rights,
(C) sell or otherwise dispose of all or substantially
all of the assets of the Company (in one transaction or a
series of transactions), or
(D) liquidate or dissolve the Company,
unless a majority of the voting stock (or the voting equity
interest) of the surviving corporation or its parent corporation
or of any corporation (or other entity) acquiring all or
substantially all of the assets of the Company (in the case of a
merger, consolidation or disposition of assets) or the Company or
its Parent (in the case of a statutory share exchange) is,
immediately following the merger, consolidation, statutory share
exchange or disposition of assets, beneficially owned by the
Participant or a group of persons, including the Participant,
acting in concert.
(f) "Code" means the Internal Revenue Code of 1986, as amended and in
effect from time to time, or any successor statute.
(g) "Committee" means three or more Disinterested Persons designated
by the Board to administer this Plan under Section 3 hereof and constituted
so as to permit this Plan to comply with Exchange Act Rule 16b-3.
(h) "Company" means Tennant Company, a Minnesota corporation, or any
successor to all or substantially all of its businesses by merger,
consolidation, purchase of assets or otherwise.
(i) "Disability" means the disability of a Participant such that the
Participant is considered disabled under any retirement plan of the Company
which is qualified under Section 401 of the Code, or as otherwise
determined by the Committee.
(j) "Disinterested Person" means a member of the Board who is
considered a disinterested person within the meaning of Exchange Act Rule
16b-3.
(k) "Employee" means any full-time or part-time employee (including
an officer or director who is also an employee) of the Company or an
Affiliate. Except with respect to grants of Incentive Stock Options,
"Employee" shall also include other individuals and entities who are not
"employees" of the Company or an Affiliate but who provide services to the
Company or an Affiliate in the capacity of an independent contractor.
References in this Plan to "employment" and related terms shall include the
providing of services in any such capacity.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as
amended; "Exchange Act Rule 16b-3" means Rule 16b-3 promulgated by the
Securities and Exchange Commission under the Exchange Act as in effect with
respect to the Company or any successor regulation.
(m) "Fair Market Value" as of any date means, unless otherwise
expressly provided in this Plan:
3
<PAGE>
(i) the closing sale price of a Share (A) on the National
Association of Securities Dealers, Inc. Automated Quotation System
National Market System, or (B) if the Shares are not traded on such
system, on the composite tape for New York Stock Exchange ("NYSE")
listed shares, or (C) if the Shares are not quoted on the NYSE
composite tape, on the principal United States securities exchange
registered under the Exchange Act on which the Shares are listed, in
any case on the date immediately preceding that date, or, if no sale
of Shares shall have occurred on that date, on the next preceding day
on which a sale of Shares occurred, or
(ii) if clause (i) is not applicable, what the Committee
determines in good faith to be 100% of the fair market value of a
Share on that date.
However, if the applicable securities exchange or system has closed
for the day at the time the event occurs that triggers a determination of
Fair Market Value, all references in this paragraph to the "date
immediately preceding that date" shall be deemed to be references to "that
date." In the case of an Incentive Stock Option, if such determination of
Fair Market Value is not consistent with the then current regulations of
the Secretary of the Treasury, Fair Market Value shall be determined in
accordance with said regulations. The determination of Fair Market Value
shall be subject to adjustment as provided in Section 12(f) hereof.
(n) "Fundamental Change" means a dissolution or liquidation of the
Company, a sale of substantially all of the assets of the Company, a merger
or consolidation of the Company with or into any other corporation,
regardless of whether the Company is the surviving corporation, or a
statutory share exchange involving capital stock of the Company.
(o) "Incentive Stock Option" means any Option designated as such and
granted in accordance with the requirements of Section 422 of the Code or
any successor to such section.
(p) "Non-Qualified Stock Option" means an Option other than an
Incentive Stock Option.
(q) "Other Stock-Based Award" means an Award of Stock or an Award
based on Stock other than Options, Stock Appreciation Rights, Restricted
Stock or Performance Shares.
(r) "Option" means a right to purchase Stock, including both Non-
Qualified Stock Options and Incentive Stock Options.
(s) "Parent" means a "parent corporation," as that term is defined in
Section 424(e) of the Code, or any successor provision.
(t) "Participant" means an Employee to whom an Award is made.
(u) "Performance Period" means the period of time as specified in an
Agreement over which Performance Shares are to be earned.
(v) "Performance Shares" means a contingent award of a specified
number of Performance Shares, with each Performance Share equivalent to one
Share, a variable percentage of which may vest depending upon the extent of
achievement of specified performance objectives during the applicable
Performance Period.
(w) "Plan" means this 1995 Stock Incentive Plan, as amended and in
effect from time to time.
(x) "Restricted Stock" means Stock granted under Section 10 hereof so
long as such Stock remains subject to one or more restrictions.
4
<PAGE>
(y) "Retirement" means termination of employment on or after age 55,
provided the Employee has been employed by the Company and/or one or more
Affiliates for at least ten years, or termination of employment on or after
age 62, provided in either case that the Employee has given the Company at
least six months' prior written notice of such termination, or as otherwise
determined by the Committee.
(z) "Share" means a share of Stock.
(aa) "Stock" means the common stock, $.375 par value per share (as
such par value may be adjusted from time to time), of the Company.
(bb) "Stock Appreciation Right" means a right, the value of which is
determined relative to appreciation in value of Shares pursuant to an Award
granted under Section 8 hereof.
(cc) "Subsidiary" means a "subsidiary corporation," as that term is
defined in Section 424(f) of the Code, or any successor provision.
(dd) "Successor" with respect to a Participant means the legal
representative of an incompetent Participant and, if the Participant is
deceased, the legal representative of the estate of the Participant or the
person or persons who may, by bequest or inheritance, or under the terms of
an Award or of forms submitted by the Participant to the Committee under
Section 12(i) hereof, acquire the right to exercise an Option or Stock
Appreciation Right or receive cash and/or Shares issuable in satisfaction
of an Award in the event of a Participant's death.
(ee) "Term" means the period during which an Option or Stock
Appreciation Right may be exercised or the period during which the
restrictions placed on Restricted Stock or any other Award are in effect.
Except when otherwise indicated by the context, reference to the
masculine gender shall include, when used, the feminine gender and any term
used in the singular shall also include the plural.
3. ADMINISTRATION.
(a) AUTHORITY OF COMMITTEE. The Committee shall administer this
Plan. The Committee shall have exclusive power to make Awards and to
determine when and to whom Awards will be granted, and the form, amount and
other terms and conditions of each Award, subject to the provisions of this
Plan. The Committee may determine whether, to what extent and under what
circumstances Awards may be settled, paid or exercised in cash, Shares or
other Awards or other property, or canceled, forfeited or suspended. The
Committee shall have the authority to interpret this Plan and any Award or
Agreement made under this Plan, to establish, amend, waive and rescind any
rules and regulations relating to the administration of this Plan, to
determine the terms and provisions of any Agreements entered into hereunder
(not inconsistent with this Plan), and to make all other determinations
necessary or advisable for the administration of this Plan. The Committee
may correct any defect, supply any omission or reconcile any inconsistency
in this Plan or in any Award in the manner and to the extent it shall deem
desirable. The determinations of the Committee in the administration of
this Plan, as described herein, shall be final, binding and conclusive.
(b) DELEGATION OF AUTHORITY. The Committee may delegate all or any
part of its authority under this Plan to persons who are not Disinterested
Persons for purposes of determining and administering Awards solely to
Employees who are not then subject to the reporting requirements of Section
16 of the Exchange Act.
5
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(c) RULE 16B-3 COMPLIANCE. It is intended that this Plan and all
Awards granted pursuant to it shall be administered by the Committee so as
to permit this Plan and Awards to comply with Exchange Act Rule 16b-3. If
any provision of this Plan or of any Award would otherwise frustrate or
conflict with the intent expressed in this Section 3(c), that provision to
the extent possible shall be interpreted and deemed amended in the manner
determined by the Committee so as to avoid such conflict. To the extent of
any remaining irreconcilable conflict with such intent, the provision shall
be deemed void as applicable to Participants who are then subject to the
reporting requirements of Section 16 of the Exchange Act to the extent
permitted by law and in the manner deemed advisable by the Committee.
(d) INDEMNIFICATION. To the full extent permitted by law, each
member and former member of the Committee and each person to whom the
Committee delegates or has delegated authority under this Plan shall be
entitled to indemnification by the Company against and from any loss,
liability, judgment, damage, cost and reasonable expense incurred by such
member, former member or other person by reason of any action taken,
failure to act or determination made in good faith under or with respect to
this Plan.
4. SHARES AVAILABLE; MAXIMUM PAYOUTS.
(a) SHARES AVAILABLE. The number of Shares available for
distribution under this Plan is 250,000, based upon the authorized shares
of the Company on February 10, 1995, the effective date of this Plan
(subject to adjustment under Section 12(f) hereof).
(b) SHARES AGAIN AVAILABLE. Any Shares subject to the terms and
conditions of an Award under this Plan which are not used because the Award
expires without all Shares subject to such Award having been issued or
because the terms and conditions of the Award are not met may again be used
for an Award under this Plan. Any Shares that are the subject of Awards
which are subsequently forfeited to the Company pursuant to the
restrictions applicable to such Award may again be used for an Award under
this Plan. If a Participant exercises a Stock Appreciation Right, any
Shares covered by the Stock Appreciation Right in excess of the number of
Shares issued (or, in the case of a settlement in cash or any other form of
property, in excess of the number of Shares equal in value to the amount of
such settlement, based on the Fair Market Value of such Shares on the date
of such exercise) may again be used for an Award under this Plan. If, in
accordance with the Plan, a Participant uses Shares to (i) pay a purchase
or exercise price, including an Option exercise price, or (ii) satisfy tax
withholdings, such Shares may again be used for an Award under this Plan.
(c) UNEXERCISED AWARDS. Any unexercised or undistributed portion of
any terminated, expired, exchanged, or forfeited Award or any Award settled
in cash in lieu of Shares (except as provided in Section 4(b) hereof) shall
be available for further Awards.
(d) NO FRACTIONAL SHARES. No fractional Shares may be issued under
this Plan; fractional Shares will be rounded to the nearest whole Share.
(e) MAXIMUM PAYOUTS. No more than 25% of all Shares subject to this
Plan may be granted in the aggregate pursuant to Restricted Stock and Other
Stock-Based Awards.
5. ELIGIBILITY. Awards may be granted under this Plan to any Employee at
the discretion of the Committee.
6. GENERAL TERMS OF AWARDS.
(a) AWARDS. Awards under this Plan may consist of Options (either
Incentive Stock Options or Non-Qualified Stock Options), Stock Appreciation
Rights, Performance Shares, Restricted Stock and Other Stock-Based Awards.
Awards of Restricted Stock may, in the discretion of the Committee, provide
the Participant with dividends or dividend equivalents and voting rights
prior to vesting (whether vesting is based on a period of time, the
attainment of specified performance conditions or otherwise).
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(b) AMOUNT OF AWARDS. Each Agreement shall set forth the number of
Shares of Restricted Stock, Stock or Performance Shares subject to such
Agreement, or the number of Shares to which the Option applies or with
respect to which payment upon the exercise of the Stock Appreciation Right
is to be determined, as the case may be, together with such other terms and
conditions applicable to the Award (not inconsistent with this Plan) as
determined by the Committee in its sole discretion.
(c) TERM. Each Agreement, other than those relating solely to Awards
of Stock without restrictions, shall set forth the Term of the Award and
any applicable Performance Period for Performance Shares, as the case may
be, but in no event shall the Term of an Award or the Performance Period be
longer than ten years after the date of grant. An Agreement with a
Participant may permit acceleration of vesting requirements and of the
expiration of the applicable Term upon such terms and conditions as shall
be set forth in the Agreement, which may, but need not, include, without
limitation, acceleration resulting from the occurrence of a Change in
Control, a Fundamental Change, or the Participant's death, Disability or
Retirement. Acceleration of the Performance Period of Performance Shares
shall be subject to Section 9(b) hereof.
(d) AGREEMENTS. Each Award under this Plan shall be evidenced by an
Agreement setting forth the terms and conditions, as determined by the
Committee, which shall apply to such Award, in addition to the terms and
conditions specified in this Plan.
(e) TRANSFERABILITY. During the lifetime of a Participant to whom an
Award is granted, only such Participant (or such Participant's legal
representative or, if so provided in the applicable Agreement in the case
of a Non-Qualified Stock Option, a permitted transferee as hereafter
described) may exercise an Option or Stock Appreciation Right or receive
payment with respect to Performance Shares or any other Award. No Award of
Restricted Stock (prior to the expiration of the restrictions), Options,
Stock Appreciation Rights, Performance Shares or other Award (other than an
award of Stock without restrictions) may be sold, assigned, transferred,
exchanged, or otherwise encumbered, and any attempt to do so shall be of no
effect. Notwithstanding the immediately preceding sentence, (i) an
Agreement may provide that an Award shall be transferable to a Successor in
the event of a Participant's death and (ii) an Agreement may provide that a
Non-Qualified Stock Option shall be transferable to any member of a
Participant's "immediate family" (as such term is defined in Rule 16a-1(e)
promulgated under the Exchange Act, or any successor rule or regulation) or
to one or more trusts whose beneficiaries are members of such Participant's
"immediate family" or partnerships in which such family members are the
only partners; provided, however, that (1) the Participant receives no
consideration for the transfer and (2) such transferred Non-Qualified Stock
Option shall continue to be subject to the same terms and conditions as
were applicable to such Non-Qualified Stock Option immediately prior to its
transfer.
(f) TERMINATION OF EMPLOYMENT. Except as otherwise determined by the
Committee or provided by the Committee in an applicable Agreement, in case
of termination of employment, the following provisions shall apply:
(1) OPTIONS AND STOCK APPRECIATION RIGHTS.
(i) DEATH. If a Participant who has been granted an
Option or Stock Appreciation Rights shall die before such Option
or Stock Appreciation Rights have expired, the Option or Stock
Appreciation Rights shall become exercisable in full, and may be
exercised by the Participant's Successor at any time, or from
time to time, within five years after the date of the
Participant's death.
(ii) DISABILITY OR RETIREMENT. If a Participant's
employment terminates because of Disability or Retirement, the
Option or Stock Appreciation Rights shall become exercisable in
full, and the Participant may exercise his or her Options or
Stock Appreciation Rights at any time, or from time to time,
within (x) five years after the date of such termination if such
termination results from the Participant's disability or (y)
within three months, or such longer period as the Committee may
permit, after the date of such termination if such termination
results from the Participant's retirement.
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(iii) REASONS OTHER THAN DEATH, DISABILITY OR RETIREMENT.
If a Participant's employment terminates for any reason other
than death, Disability or Retirement, the unvested or unexercised
portion of any Award held by such Participant shall terminate at
the date of termination of employment.
(iv) EXPIRATION OF TERM. Notwithstanding the foregoing
paragraphs (i)-(iii), in no event shall an Option or a Stock
Appreciation Right be exercisable after expiration of the Term of
such Award.
(2) PERFORMANCE SHARES. If a Participant's employment with the
Company or any of its Affiliates terminates during a Performance
Period because of death, Disability or Retirement, or under other
circumstances provided by the Committee in its discretion in the
applicable Agreement, the Participant shall be entitled to a payment
of Performance Shares at the end of the Performance Period based upon
the extent to which achievement of performance targets was satisfied
at the end of such period (as determined at the end of the Performance
Period) and prorated for the portion of the Performance Period during
which the Participant was employed by the Company or any Affiliate.
Except as provided in this Section 6(f)(2) or in the applicable
Agreement, if a Participant's employment terminates with the Company
or any of its Affiliates during a Performance Period, then such
Participant shall not be entitled to any payment with respect to that
Performance Period.
(3) RESTRICTED STOCK. Unless otherwise provided in the
applicable Agreement, in case of a Participant's death, Disability or
Retirement, the Participant shall be entitled to receive that number
of shares of Restricted Stock under outstanding Awards which has been
pro rated for the portion of the Term of the Awards during which the
Participant was employed by the Company or any Affiliate, and with
respect to such Shares all restrictions shall lapse.
(g) RIGHTS AS SHAREHOLDER. A Participant shall have no rights as a
shareholder with respect to any securities covered by an Award until the
date the Participant becomes the holder of record.
7. STOCK OPTIONS.
(a) TERMS OF ALL OPTIONS. Each Option shall be granted pursuant to an
Agreement as either an Incentive Stock Option or a Non-Qualified Stock
Option. Only Non-Qualified Stock Options may be granted to Employees who
are not employees of the Company or an Affiliate. The purchase price of
each Share subject to an Option shall be determined by the Committee and
set forth in the Agreement, but shall not be less than 100% of the Fair
Market Value of a Share as of the date the Option is granted. The purchase
price of the Shares with respect to which an Option is exercised shall be
payable in full at the time of exercise, provided that, to the extent
permitted by law, Participants may simultaneously exercise Options and sell
the Shares thereby acquired pursuant to a brokerage or similar relationship
and use the proceeds from such sale to pay the purchase price of such
Shares. The purchase price may be paid in cash or, if the Committee so
permits, through a reduction of the number of Shares delivered to the
Participant upon exercise of the Option or delivery to the Company of
Shares held by such Participant (in each case, such Shares having a Fair
Market Value as of the date the Option is exercised equal to the purchase
price of the Shares being purchased pursuant to the Option), or a
combination thereof, unless otherwise provided in the Agreement. If the
Committee so determines, the Agreement relating to any Option may provide
for the issuance of "reload" Options pursuant to which, subject to the
terms and conditions established by the Committee and any applicable
requirements of Exchange Act Rule 16b-3 or any other applicable law, the
Participant will, either automatically or subject to subsequent Committee
approval, be granted a new Option when the payment of the exercise price of
the original Option, or the payment of tax withholdings pursuant to Section
12(d) hereof, is made through the delivery to the Company of Shares held by
such Participant, such new "reload" Option (i) being an Option to purchase
the number of Shares provided as consideration for the exercise price and
in payment of taxes in connection with the exercise of the original Option,
and (ii) having a per Share
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exercise price equal to the Fair Market Value as of the date of exercise of
the original Option. Each Option shall be exercisable in whole or in part
on the terms provided in the Agreement. In no event shall any Option be
exercisable at any time after its Term. When an Option is no longer
exercisable, it shall be deemed to have lapsed or terminated. No
Participant may receive any combination of Options to purchase and Stock
Appreciation Rights relating to more than 50,000 Shares in the aggregate
pursuant to Awards in any year under this Plan.
(b) INCENTIVE STOCK OPTIONS. In addition to the other terms and
conditions applicable to all Options:
(i) the aggregate Fair Market Value (determined as of the date
the Option is granted) of the Shares with respect to which Incentive
Stock Options held by an individual first become exercisable in any
calendar year (under this Plan and all other incentive stock option
plans of the Company and its Affiliates) shall not exceed $100,000 (or
such other limit as may be required by the Code), if such limitation
is necessary to qualify the Option as an Incentive Stock Option, and
to the extent an Option or Options granted to a Participant exceed
such limit, such Option or Options shall be treated as a Non-Qualified
Stock Option;
(ii) an Incentive Stock Option shall not be exercisable and the
Term of the Award shall not be more than ten years after the date of
grant (or such other limit as may be required by the Code) if such
limitation is necessary to qualify the Option as an Incentive Stock
Option;
(iii) the Agreement covering an Incentive Stock Option shall
contain such other terms and provisions which the Committee determines
necessary to qualify such Option as an Incentive Stock Option; and
(iv) notwithstanding any other provision of this Plan to the
contrary, no Participant may receive an Incentive Stock Option under
this Plan if, at the time the Award is granted, the Participant owns
(after application of the rules contained in Section 424(d) of the
Code, or its successor provision) Shares possessing more than ten
percent of the total combined voting power of all classes of stock of
the Company or its subsidiaries, unless (A) the option price for such
Incentive Stock Option is at least 110% of the Fair Market Value of
the Shares subject to such Incentive Stock Option on the date of grant
and (B) such Option is not exercisable after the date five years from
the date such Incentive Stock Option is granted.
8. STOCK APPRECIATION RIGHTS. An Award of a Stock Appreciation Right
shall entitle the Participant, subject to terms and conditions determined by the
Committee, to receive upon exercise of the Stock Appreciation Right all or a
portion of the excess of (i) the Fair Market Value of a specified number of
Shares as of the date of exercise of the Stock Appreciation Right over (ii) a
specified price which shall not be less than 100% of the Fair Market Value of
such Shares as of the date of grant of the Stock Appreciation Right. A Stock
Appreciation Right may be granted in connection with a previously or
contemporaneously granted Option, or independent of any Option. If issued in
connection with an Option, the Committee may impose a condition that exercise of
a Stock Appreciation Right cancels the Option with which it is connected and
exercise of the connected Option cancels the Stock Appreciation Right. Each
Stock Appreciation Right may be exercisable in whole or in part on the terms
provided in the Agreement. Notwithstanding anything to the contrary stated in
this Plan, no Stock Appreciation Right shall be exercisable prior to six months
from the date of grant except in the event of the death or Disability of the
Participant. No Stock Appreciation Right shall be exercisable at any time after
its Term. When a Stock Appreciation Right is no longer exercisable, it shall be
deemed to have lapsed or terminated. Except as otherwise provided in the
applicable Agreement, upon exercise of a Stock Appreciation Right, payment to
the Participant (or to his or her Successor) shall be made in the form of cash,
Stock or a combination of cash and Stock as promptly as practicable after such
exercise. The Agreement may provide for a limitation upon the amount or
percentage of the total appreciation on which payment (whether in cash and/or
Stock) may be made in the event of the exercise of a Stock Appreciation Right.
As specified in Section 7(a) hereof, no Participant may receive any combination
of Options to purchase and Stock Appreciation Rights relating to more than
50,000 Shares in the aggregate pursuant to Awards in any year under this Plan.
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9. PERFORMANCE SHARES.
(a) INITIAL AWARD. An Award of Performance Shares shall entitle a
Participant (or a Successor) to future payments based upon the achievement
of performance targets established in writing by the Committee. Payment
shall be made in Stock, or a combination of cash and Stock, as determined
by the Committee, provided that at least 25% of the value of the vested
Performance Shares shall be distributed in the form of Stock. With respect
to those Participants who are "covered employees" within the meaning of
Section 162(m) of the Code and the regulations thereunder, such performance
targets shall consist of one or any combination of two or more of earnings
or earnings per share before income tax (profit before taxes), net earnings
or net earnings per share (profits after tax), inventory, total, or net
operating asset turnover, operating income, total shareholder return,
return on equity, pre-tax and pre-interest expense return on average
invested capital, which may be expressed on a current value basis, or sales
growth, and any such targets may relate to one or any combination of two or
more of corporate, group, unit, division, Affiliate or individual
performance. The Agreement may establish that a portion of the maximum
amount of a Participant's Award will be paid for performance which exceeds
the minimum target but falls below the maximum target applicable to such
Award. The Agreement shall also provide for the timing of such payment.
Following the conclusion or acceleration of each Performance Period, the
Committee shall determine the extent to which (i) performance targets have
been attained, (ii) any other terms and conditions with respect to an Award
relating to such Performance Period have been satisfied, and (iii) payment
is due with respect to a Performance Share Award. No Participant may
receive Performance Shares relating to more than 50,000 Shares pursuant to
Awards in any year under this Plan.
(b) ACCELERATION AND ADJUSTMENT. The Agreement may permit an
acceleration of the Performance Period and an adjustment of performance
targets and payments with respect to some or all of the Performance Shares
awarded to a Participant, upon such terms and conditions as shall be set
forth in the Agreement, upon the occurrence of certain events, which may,
but need not, include without limitation a Change in Control, a Fundamental
Change, the Participant's death, Disability or Retirement, a change in
accounting practices of the Company or its Affiliates, or, with respect to
payments in Stock for Performance Share Awards, a reclassification, stock
dividend, stock split or stock combination as provided in Section 12(f)
hereof.
(c) VALUATION. Each Performance Share earned after conclusion of a
Performance Period shall have a value equal to the Fair Market Value of a
Share on the last day of such Performance Period.
10. RESTRICTED STOCK. Subject to Section 4(e), Restricted Stock may be
granted in the form of Shares registered in the name of the Participant but held
by the Company until the end of the Term of the Award. Any employment
conditions, performance conditions and the Term of the Award shall be
established by the Committee in its discretion and included in the applicable
Agreement. The Committee may provide in the applicable Agreement for the lapse
or waiver of any such restriction or condition based on such factors or criteria
as the Committee, in its sole discretion, may determine. No Award of Restricted
Stock may vest earlier than one year from the date of grant, except as provided
in the applicable Agreement.
11. OTHER STOCK-BASED AWARDS. Subject to Section 4(e), the Committee may
from time to time grant Awards of Stock, and other Awards under this Plan
(collectively herein defined as "Other Stock-Based Awards"), including without
limitation those Awards pursuant to which Shares may be acquired in the future,
such as Awards denominated in Stock units, securities convertible into Stock and
phantom securities. The Committee, in its sole discretion, shall determine the
terms and conditions of such Awards provided that such Awards shall not be
inconsistent with the terms and purposes of this Plan. The Committee may, in
its sole discretion, direct the Company to issue Shares subject to restrictive
legends and/or stop transfer instructions which are consistent with the terms
and conditions of the Award to which such Shares relate.
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12. GENERAL PROVISIONS.
(a) EFFECTIVE DATE OF THIS PLAN. This Plan shall become effective as
of February 10,1995, provided that this Plan is approved and ratified by
the affirmative vote of the holders of a majority of the outstanding Shares
of Stock present or represented and entitled to vote in person or by proxy
at a meeting of the shareholders of the Company no later than May 31, 1995.
If this Plan is not so approved by such holders, any Awards granted under
this Plan subject to such approval shall be null and void.
(b) DURATION OF THIS PLAN. This Plan shall remain in effect until
all Stock subject to it shall be distributed or all Awards have expired or
lapsed, whichever is latest to occur, or this Plan is terminated pursuant
to Section 12(e) hereof. No Award of an Incentive Stock Option shall be
made more than ten years after the effective date provided in Section 12(a)
hereof (or such other limit as may be required by the Code) if such
limitation is necessary to qualify the Option as an Incentive Stock Option.
The date and time of approval by the Committee of the granting of an Award
shall be considered the date and time at which such Award is made or
granted, notwithstanding the date of any Agreement with respect to such
Award; provided, however, that the Committee may grant Awards other than
Incentive Stock Options to be effective and deemed to be granted on the
occurrence of certain specified contingencies.
(c) RIGHT TO TERMINATE EMPLOYMENT. Nothing in this Plan or in any
Agreement shall confer upon any Participant who is an Employee the right to
continue in the employment of the Company or any Affiliate or affect any
right which the Company or any Affiliate may have to terminate or modify
the employment of the Participant with or without cause.
(d) TAX WITHHOLDING. The Company may withhold from any payment of
cash or Stock to a Participant or other person under this Plan an amount
sufficient to cover any required withholding taxes, including the
Participant's social security and Medicare taxes (FICA) and federal, state
and local income tax with respect to income arising from payment of the
Award. The Company shall have the right to require the payment of any such
taxes before issuing any Stock pursuant to the Award. In lieu of all or
any part of a cash payment from a person receiving Stock under this Plan,
the individual may elect to cover all or any part of the required
withholdings, and to cover any additional withholdings up to the amount
needed to cover the individual's full FICA and federal, state and local
income tax with respect to income arising from payment of the Award,
through a reduction of the number of Shares delivered to such individual or
a subsequent return to the Company of Shares held by the Participant or
other person, in each case valued in the same manner as used in computing
the withholding taxes under the applicable laws, subject to the limitations
of the following sentence. Unless the Committee otherwise permits, such
elections are subject to the following limitations if, and to the extent,
such limitations are necessary to comply with Exchange Act Rule 16b-3 or
any successor provision:
(1) Except as set forth in clause (iii) below, any such election
by a Participant who is then subject to the reporting requirements of
Section 16 of the Exchange Act or any successor provision ("Section
16") or a Successor of such a Participant shall be subject to the
conditions set forth in clauses (i) and (ii) below:
(i) (A) the election shall be made during the period
beginning on the third business day following the date of public
release of the Company's quarterly or annual summary statements
of sales and earnings and ending on the twelfth business day
following such date, or (B) the election shall be made at least
six months prior to the date the Award is paid to the
Participant;
(ii) a period of at least six months shall elapse between
the date of grant of the Award to which the payment relates and
the date such Award is paid to the Participant; provided,
however, that such restriction does not apply in the event death
or Disability of the Participant occurs prior to such election
and during that six-month period;
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(iii) notwithstanding the foregoing, a Participant who
tenders previously owned Shares to the Company in payment of the
purchase price of Shares in connection with exercise of an Option
may also tender previously owned Shares to the Company in
satisfaction of any tax withholding obligations in connection
with such Option exercise without regard to the time periods set
forth in clauses (i) and (ii) above.
The foregoing restrictions do not apply to any Participant who is not
subject to the reporting requirements of Section 16 at the time of the
election.
(2) Any such election by a Participant who is subject to the
reporting requirements of Section 16 at the time is irrevocable and is
subject to approval by the Committee. The Committee's approval may be
granted in advance but is subject to revocation by the Committee at
any time.
(e) AMENDMENT, MODIFICATION AND TERMINATION OF THIS PLAN. Except as
provided in this Section 12(e), the Board may at any time amend, modify,
terminate or suspend this Plan. Except as provided in this Section 12(e),
the Committee may at any time alter or amend any or all Agreements under
this Plan to the extent permitted by law. Amendments are subject to
approval of the shareholders of the Company only if such approval is
necessary to maintain this Plan in compliance with the requirements of
Exchange Act Rule 16b-3, Section 422 of the Code, their successor
provisions, or any other applicable law or regulation. No termination,
suspension or modification of this Plan may materially and adversely affect
any right acquired by any Participant (or a Participant's legal
representative) or any Successor under an Award granted before the date of
termination, suspension or modification, unless otherwise agreed by the
Participant in the Agreement or otherwise or required as a matter of law.
It is conclusively presumed that any adjustment for changes in
capitalization provided for in Section 9(b) or 12(f) hereof does not
adversely affect any right of a Participant under an Award.
(f) ADJUSTMENT FOR CHANGES IN CAPITALIZATION. Appropriate
adjustments in the aggregate number and type of Shares available for Awards
under this Plan, in the limitations on the number and type of Shares that
may be issued to an individual Participant, in the number and type of
Shares and amount of cash subject to Awards then outstanding, in the Option
exercise price as to any outstanding Options and, subject to Section 9(b)
hereof, in outstanding Performance Shares and payments with respect to
outstanding Performance Shares may be made by the Committee in its sole
discretion to give effect to adjustments made in the number or type of
Shares through a Fundamental Change (subject to Section 12(g) hereof),
recapitalization, reclassification, stock dividend, stock split, stock
combination, or other relevant change, provided that fractional Shares
shall be rounded to the nearest whole Share.
(g) FUNDAMENTAL CHANGE. In the event of a proposed Fundamental
Change: (a) involving a merger, consolidation or statutory share exchange,
unless appropriate provision shall be made (which the Committee may, but
shall not be obligated to, make) for the protection of the outstanding
Options and Stock Appreciation Rights by the substitution of options, stock
appreciation rights and appropriate voting common stock of the corporation
surviving any such merger or consolidation or, if appropriate, the Parent
of such surviving corporation, to be issuable upon the exercise of options
or used to calculate payments upon the exercise of stock appreciation
rights in lieu of Options, Stock Appreciation Rights and capital stock of
the Company, or (b) involving the dissolution or liquidation of the
Company, the Committee may, but shall not be obligated to, declare, at
least twenty days prior to the occurrence of the Fundamental Change, and
provide written notice to each holder of an Option or Stock Appreciation
Right of the declaration, that each outstanding Option and Stock
Appreciation Right, whether or not then exercisable, shall be canceled at
the time of, or immediately prior to the occurrence of, the Fundamental
Change in exchange for payment to each holder of an Option or Stock
Appreciation Right, within 20 days after the Fundamental Change, of cash
equal to (i) for each Share covered by the canceled Option, the amount, if
any, by which the Fair Market Value (as defined in this Section 12(g)) per
Share exceeds the exercise price per Share covered by such Option or (ii)
for each Stock Appreciation Right, the price determined pursuant to Section
8 hereof, except that Fair Market Value of the Shares as of the date of
exercise of the Stock Appreciation Right, as used in clause (i) of Section
8, shall be deemed to mean Fair Market Value for each Share with respect to
which the Stock Appreciation Right is calculated
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determined in the manner hereinafter referred to in this Section 12(g). At
the time of the declaration provided for in the immediately preceding
sentence, each Stock Appreciation Right that has been outstanding for at
least six months and each Option shall immediately become exercisable in
full and each person holding an Option or a Stock Appreciation Right shall
have the right, during the period preceding the time of cancellation of the
Option or Stock Appreciation Right, to exercise the Option as to all or any
part of the Shares covered thereby or the Stock Appreciation Right in whole
or in part, as the case may be. In the event of a declaration pursuant to
this Section 12(g), each outstanding Option and Stock Appreciation Right
that shall not have been exercised prior to the Fundamental Change shall be
canceled at the time of, or immediately prior to, the Fundamental Change,
as provided in the declaration. Notwithstanding the foregoing, no person
holding an Option or Stock Appreciation Right shall be entitled to the
payment provided for in this Section 12(g) if such Option or Stock
Appreciation Right shall have expired pursuant to an Agreement. For
purposes of this Section 12(g) only, "Fair Market Value" per Share means
the cash plus the fair market value, as determined in good faith by the
Committee, of the non-cash consideration to be received per Share by the
shareholders of the Company upon the occurrence of the Fundamental Change,
notwithstanding anything to the contrary provided in this Plan.
(h) OTHER BENEFIT AND COMPENSATION PROGRAMS. Payments and other
benefits received by a Participant under an Award shall not be deemed a
part of a Participant's regular, recurring compensation for purposes of any
termination, indemnity or severance pay laws and shall not be included in,
nor have any effect on, the determination of benefits under any other
employee benefit plan, contract or similar arrangement provided by the
Company or an Affiliate, unless expressly so provided by such other plan,
contract or arrangement or the Committee determines that an Award or
portion of an Award should be included to reflect competitive compensation
practices or to recognize that an Award has been made in lieu of a portion
of competitive cash compensation.
(i) BENEFICIARY UPON PARTICIPANT'S DEATH. To the extent that the
transfer of a Participant's Award at death is permitted by this Plan or
under an Agreement, (i) a Participant's Award shall be transferable to the
beneficiary, if any, designated on forms prescribed by and filed with the
Committee and (ii) upon the death of the Participant, such beneficiary
shall succeed to the rights of the Participant to the extent permitted by
law and this Plan. If no such designation of a beneficiary has been made,
the Participant's legal representative shall succeed to the Awards, which
shall be transferable by will or pursuant to laws of descent and
distribution to the extent permitted by this Plan or under an Agreement.
(j) UNFUNDED PLAN. This Plan shall be unfunded and the Company shall
not be required to segregate any assets that may at any time be represented
by Awards under this Plan. Neither the Company, its Affiliates, the
Committee, nor the Board shall be deemed to be a trustee of any amounts to
be paid under this Plan nor shall anything contained in this Plan or any
action taken pursuant to its provisions create or be construed to create a
fiduciary relationship between the Company and/or its Affiliates, and a
Participant or Successor. To the extent any person acquires a right to
receive an Award under this Plan, such right shall be no greater than the
right of an unsecured general creditor of the Company.
(k) LIMITS OF LIABILITY.
(i) Any liability of the Company to any Participant with
respect to an Award shall be based solely upon contractual obligations
created by this Plan and the Agreement.
(ii) Except as may be required by law, neither the Company nor
any member or former member of the Board or of the Committee, nor any
other person participating (including participation pursuant to a
delegation of authority under Section 3(b) hereof) in any
determination of any question under this Plan, or in the
interpretation, administration or application of this Plan, shall have
any liability to any party for any action taken, or not taken, in good
faith under this Plan.
13
<PAGE>
(l) COMPLIANCE WITH APPLICABLE LEGAL REQUIREMENTS. No certificate
for Shares distributable pursuant to this Plan shall be issued and
delivered unless the issuance of such certificate complies with all
applicable legal requirements including, without limitation, compliance
with the provisions of applicable state securities laws, the Securities Act
of 1933, as amended and in effect from time to time or any successor
statute, the Exchange Act and the requirements of the exchanges, if any, on
which the Company's Shares may, at the time, be listed.
(m) DEFERRALS AND SETTLEMENTS. The Committee may require or permit
Participants to elect to defer the issuance of Shares or the settlement of
Awards in cash under such rules and procedures as it may establish under
this Plan. It may also provide that deferred settlements include the
payment or crediting of interest on the deferral amounts.
13. GOVERNING LAW. To the extent that federal laws do not otherwise
control, this Plan and all determinations made and actions taken pursuant to
this Plan shall be governed by the laws of Minnesota and construed accordingly.
14. SEVERABILITY. In the event any provision of this Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of this Plan, and this Plan shall be construed and enforced
as if the illegal or invalid provision had not been included.
15. PRIOR PLAN. Notwithstanding the adoption of this Plan by the Board
and approval of this Plan by the Company's shareholders as provided by Section
12(a) hereof, the Company's 1992 Stock Incentive Plan, as amended (the
"Incentive Plan"), shall remain in effect and the Committee may continue to make
grants of performance shares, restricted stock and any other awards pursuant to
and subject to the limitations of the Incentive Plan. All grants and awards
heretofore or hereafter made under the Incentive Plan shall be governed by the
terms of the Incentive Plan.
14
<PAGE>
Exhibit 5
August 10, 1995
Board of Directors
Tennant Company
701 North Lilac Drive
Minneapolis, MN 55422
Ladies and Gentlemen:
In connection with the proposed registration under the Securities Act of 1933,
as amended, of shares of Common Stock of Tennant Company, a Minnesota
corporation (the "Company"), to be offered pursuant to the Tennant Company
1995 Stock Incentive Plan (the "Plan"), I have examined the Company's Restated
Articles of Incorporation, as amended, its Restated By-Laws, and such other
documents, including the Registration Statement on Form S-8, dated the date
hereof, to be filed with the Securities and Exchange Commission relating to
such shares (the "Registration Statement"), and have reviewed such matters of
law as I have deemed necessary for this opinion. Accordingly, based upon the
foregoing, I am of the opinion that:
1. The Company has duly authorized the issuance of the shares of
Common Stock which may be issued pursuant to the Plan.
2. The shares which may be issued pursuant to the Plan will be, upon
issuance, validly issued and outstanding and fully paid and
nonassessable.
3. All necessary corporate action has been taken by the Company to
adopt the Plan, and the Plan is a validly existing plan of the Company.
I consent to the filing of this opinion as an exhibit to the Registration
Statement.
Sincerely,
Janet M. Dolan
Senior Vice President and General Counsel
<PAGE>
Exhibit 23.1
The Board of Directors
Tennant Company:
We consent to the use of our reports incorporated herein by reference.
KPMG Peat Marwick LLP
Minneapolis, Minnesota
August 10, 1995
<PAGE>
Exhibit 24
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Roger L. Hale
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Arthur D. Collins, Jr.
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ David C. Cox
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Andrew P. Czajkowski
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Vernon H. Heath
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ William A. Hodder
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Delbert W. Johnson
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ William I. Miller
--------------------------------------
<PAGE>
TENNANT COMPANY
POWER OF ATTORNEY OF DIRECTOR AND OFFICER
-----------------------------------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director
and/or officer of Tennant Company, a Minnesota corporation, does hereby make,
constitute and appoint Roger L. Hale, Janet M. Dolan and Bruce J. Borgerding,
and each or any of them, the undersigned's true and lawful attorneys-in-fact,
with full power of substitution and resubstitution for the undersigned in the
undersigned's name, place and stead, to sign and affix the undersigned's name
as such director and/or officer of said Company to the Registration Statement
or Registration Statements on Form S-8 relating to the Tennant Company 1995
Stock Incentive Plan and all amendments (including post-effective amendments)
thereto, to be filed by said Company with the Securities and Exchange
Commission, and to file the same, with all exhibits thereto and other
supporting documents, with said Commission, granting unto said attorneys-in-
fact, and each of them, full power and authority to do and perform any and all
acts necessary or incidental to the performance and execution of the powers
herein expressly granted, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact, or either of them, or any of their substitutes,
may lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set the
undersigned's hand this 10th day of August, 1995.
/s/ Arthur R. Schulze, Jr.
---------------------------------------
