-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PKFik3i6tAswY/dIftOrlNtJxWsscK3GbjvwZCcAcWQqovggaOqGMcaaQ+9tgyO7 p4Rk4Oo3kZM4zIbFApzduA== 0000012614-97-000013.txt : 19970918 0000012614-97-000013.hdr.sgml : 19970918 ACCESSION NUMBER: 0000012614-97-000013 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19970915 EFFECTIVENESS DATE: 19970915 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: BLESSINGS CORP CENTRAL INDEX KEY: 0000012614 STANDARD INDUSTRIAL CLASSIFICATION: UNSUPPORTED PLASTICS FILM & SHEET [3081] IRS NUMBER: 135566477 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-35611 FILM NUMBER: 97680289 BUSINESS ADDRESS: STREET 1: 200 ENTERPRISE DRIVE CITY: NEWPORT NEWS STATE: VA ZIP: 23603 BUSINESS PHONE: 8048872100 MAIL ADDRESS: STREET 1: 200 ENTERPRISE DRIVE CITY: NEWPROT NEWS STATE: VA ZIP: 23603 FORMER COMPANY: FORMER CONFORMED NAME: ASSOCIATED BABY SERVICES INC DATE OF NAME CHANGE: 19720828 S-8 1 As filed with the Securities and Exchange Commission on September 15, 1997 Registration No. 333-__________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 BLESSINGS CORPORATION (Exact Name of Registrant as Specified in Its Charter) Delaware 13-5566477 (State or Other Jurisdiction of (I.R.S. Employer ID No.) Incorporation or Organization) 200 Enterprise Drive Newport News, Virginia 23603 (Address of Principal Executive Office) (Zip Code) BLESSINGS CORPORATION Michael Carlson Compensation Contract (Full Title of the Plan) Wayne A. Durboraw Blessings Corporation 200 Enterprise Drive Newport News, VA 23603 (Name and Address of Agent for Service) (757) 887-2100 (Telephone Number, Including Area Code, of Agent for Service) CALCULATION OF REGISTRATION FEE =============================================================================== Proposed Title of Proposed Maximum Securities Amount Maximum Aggregate Amount of to be to be Offering Price Offering Registration Registered Registered Per Share(1) Price(1) Fee(1) =============================================================================== Common Stock, ($.71 par value 3,000 $13.00 $39,000.00 $100.00 per share) =============================================================================== (1) Pursuant to Rules 457(c) and 457(h), the registration fee was computed using $13.00 per share of Common Stock, the average of the high and low prices reported in the consolidated reporting system of the American Stock Exchange on September 8, 1997. PART II INFORMATION REQUIRED IN REGISTRATION STATEMENT AND NOT REQUIRED IN PROSPECTUS Item 3: Incorporation of Documents by Reference. The following documents filed by Blessings Corporation (the "Company" or the "Registrant") with the Securities and Exchange Commission (the "Commission"), are incorporated herein by reference and made a part hereof: (a) The Company's Annual Report on Form 10-K for the Company's fiscal year ended December 31, 1996 filed pursuant to Section 13(a) of the Securities Exchange Act of 1934, as amended (the "1934 Act"). (b) All reports filed by the Company pursuant to Section 13(a) of the 1934 Act since the end of the Company's fiscal year ended December 31, 1996. (c) The description of the Company's Common Stock registered under the 1934 Act contained in the Company's Registration Statement on Form S-8, Registration Statement No. 2-45391, effective September 21, 1972. All reports and other documents subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the 1934 Act prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold, or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference into this Registration Statement and to be part hereof from the date of filing of such documents. Any statement contained in a document incorporated into this Registration Statement by reference shall be deemed to be modified or superseded for the purposes of this Registration Statement to the extent that a statement contained in this Registration Statement or in any other subsequently filed document which also is or is deemed to be incorporated into this Registration Statement by reference modifies or replaces such statement. Item 4: Description of Securities. Not applicable. Item 5: Interest of Named Experts and Counsel. Not applicable. Item 6: Indemnification of Directors and Officers. Section 145 of the General Corporation Law of Delaware provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses (including attorneys fees), judgments, fines and amounts paid in settlement in connection with specified actions, suits or proceedings, whether civil, criminal, administrative or investigative, other than an action by or in the right of the corporation (a "derivative action"), if they acted in good faith and in a manner they 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 their conduct was unlawful. A similar standard is applicable in the case of derivative actions, except that indemnification only extends to expenses (including attorneys fees) incurred in connection with defense of settlement of such action, and the statute requires court approval before there can be any indemnification where the person seeking indemnification has been found liable to the corporation. The statute provides that it is not exclusive of other indemnification that may be granted by a corporation's charter, bylaws, disinterested director vote, stockholder vote, agreement or otherwise. Article VI of the Company's Bylaws requires indemnification to the full extent permitted under Delaware law as from time to time in effect. Subject to any limitations imposed by Delaware law, the Bylaws provide an unconditional right to indemnification for all expenses, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) actually and reasonably incurred by any person in connection with any actual or threatened proceeding (including, to the extent permitted by law, any derivative action) by reason of the fact that such person is or was serving as a director or officer of the Company or, at the request of the Company, of another corporation, partnership, joint venture, trust or other enterprise, including an employee benefit plan. The Bylaws also provide that the Company may, by action of its Board of Directors, provide indemnification to its employees and agents with the same scope and effect as the foregoing indemnification of directors and officers. Officers and directors of the Company are covered by insurance which (with certain exceptions and within certain limitations) indemnifies them against losses and liabilities arising from any alleged "wrongful act" including any alleged error or misstatement or misleading statement, or wrongful act or omission or neglect or breach of duty. Section 102(b)(7) of the Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) payments of unlawful dividends or unlawful stock repurchases or redemptions, or (iv) for any transaction from which the director derived an improper personal benefit. Article Twelfth of the Certificate of Incorporation of the Company provides that to the full extent that the Delaware General Corporation Law, as it now exists or may hereafter be amended, permits the limitation or elimination of the liability of directors, a director of the Company shall not be liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director. Any amendment to or repeal of such Article Twelfth shall not adversely affect any right or protection of a director of the Company for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal. Item 7: Exemption from Registration Claimed. Not applicable. Item 8: Exhibits. 4.1 Certificate of Incorporation of the Company and all amendments through Amendment dated December 15, 1994 (incorporated herein by reference to the Company's Form 10-K for the year ended December 31, 1994 filed with the Commission on or about March 28, 1995). 4.2 Bylaws of the Company, as amended (incorporated herein by reference to the Company's Registration Statement on Form S-8 filed with the Commission on or about October 16, 1993). * 5.1 Opinion of Kaufman & Canoles, P.C. *15.1 Letter re: unaudited financial information. *23.1 Consent of Deloitte & Touche LLP. *23.2 Consent of Kaufman & Canoles (included in opinion filed as Exhibit 5.1). *24.1 Power of Attorney (included on the signature pages hereto). *99.1 Blessings Corporation Stock Option Agreement. *99.2 Michael Carlson Compensation Contract. __________________ * Filed herewith. Item 9: Undertakings. (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement to include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at the time shall be deemed to be the initial bona fide offering thereof. (h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant, 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 it he Act and will be governed by the final adjudication of such issue SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all 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 Newport News, Virginia, on this day of September 15, 1997. BLESSINGS CORPORATION By: /s/Elwood M. Miller Elwood M. Miller President and Chief Executive Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature appears below constitutes and appoints James P. Luke and Wayne A. Durboraw, and each of them, his true and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him and in his name, place and stead, 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 all documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises 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 either of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities an on the dates indicated: Witness our hands and common seals on the date set forth below. Signature /s/Leonard Birnbaum September 9, 1997 Leonard Birnbaum, Director /s/Joseph J. Harkins September 9, 1997 Joseph J. Harkins, Director /s/John M. Hogg September 9, 1997 John M. Hogg, Director /s/James P. Luke September 9, 1997 James P. Luke, Executive Vice President, Chief Financial Officer, Secretary and Director (Principal Financial Officer) /s/Elwood M. Miller September 9, 1997 Elwood M. Miller, President and Chief Executive Officer and Director (Principal Executive Officer) /s/Richard C. Patton September 9, 1997 Richard C. Patton, Director /s/Manuel Villarreal G. September 9, 1997 Manuel Villarreal G., President and Chief Executive Officer of NEPSA, Director /s/Robert E. Weber September 9, 1997 Robert E. Weber, Director /s/J. Donovan Williamson September 9, 1997 J. Donovan Williamson, Director /s/Wayne A. Durboraw September 9, 1997 Wayne A. Durboraw, Controller (Principal Accounting Officer) EXHIBIT INDEX The following exhibits are filed herewith unless otherwise indicated: Sequentially Exhibit Numbered Number Exhibit Page 4.1 Certificate of Incorporation of the Company and all amendments through Amendment dated December 15, 1994 (incorporated herein by reference to the Company's Form 10-K for the year ended * December 31, 1994 filed with * the Commission on or about March 28, 1995). 4.2 Bylaws of the Company, as amended (incorporated herein by reference to the Company's Registration * Statement on Form S-8 filed with the Commission on or about October 16, 1993). **5.1 Opinion of Kaufman & Canoles, P.C. **15.1 Letter re: unaudited financial information. **23.1 Consent of Deloitte & Touche LLP. **23.2 Consent of Kaufman & Canoles (included in opinion filed as Exhibit 5.1). **24.1 Power of Attorney (included on the signature pages hereto). **99.1 Blessings Corporation Stock Option Agreement. **99.2 Michael Carlson Compensation Contract. - ---- * Not filed herewith. In accordance with Rule 12b-32 of the General Rules and Regulations under the Securities Exchange Act of 1934, the exhibit is incorporated by reference. **Filed herewith. EXHIBIT 5.1 September 15, 1997 Blessings Corporation 200 Enterprise Drive Newport News, VA 23603 Dear Sirs: In connection with the registration on Form S-8 ("Registration Statement") under the Securities Act of 1933, as amended, of 3,000 shares ("Shares") of Common Stock of Blessings Corporation ("Company"), which may be issued pursuant to the terms of the Michael Carlson Compensation Contract ("Contract"), we hereby advise you that in our opinion the Shares will be validly issued, fully paid and non-assessable upon issuance pursuant to the terms of the Contract. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. Sincerely, /s/Kaufman & Canoles KAUFMAN & CANOLES, a professional corporation EXHIBIT 15.1 September 15, 1997 Blessings Corporation Newport News, Virginia We have made a review, in accordance with standards established by the American Institute of Certified Public Accountants, of the unaudited interim financial information of Blessings Corporation and subsidiaries for the periods ended March 31, 1997 and 1996 and June 30, 1997 and 1996, as indicated in our reports dated April 18, 1997 and July 18, 1997, respectively; because we did not perform an audit, we expressed no opinion on that information. We are aware that our report referred to above, which was included in your Quarterly Reports on Form 10-Q for the quarters ended March 31, 1997 and June 30, 1997, are being used in this Registration Statement. We also are aware that the aforementioned reports, pursuant to Rule 436(c) under the Securities Act of 1933, are not considered a part of the Regulation Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act. DELOITTE & TOUCHE,LLP Richmond, Virginia EXHIBIT 23.1 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of Blessings Corporation on Form S-8 of our reports dated February 21, 1997, appearing in and incorporated by reference in the Annual Report on Form 10-K of Blessings Corporation for the year ended December 31, 1996. DELOITTE & TOUCHE LLP Richmond, Virginia September 15, 1997 EXHIBIT 99.1 BLESSINGS CORPORATION STOCK OPTION AGREEMENT In accordance with new SEC Rule 16b-3 effective August 15, 1996, and with, but not under, the terms and provisions of the Blessings Corporation 1991 Stock Option Plan (the "1991 Plan") a copy of which is attached hereto and incorporated herein by reference, Blessings Corporation (the "Company") hereby grants to Michael Carlson (the "Grantee"), an employee of the Company, the following: (a) An option to purchase 3,000 shares of the Company's Common Stock, $.71 par value, at a price of $9.687 per share, subject to adjustment as provided in the 1991 Plan; and (b) 900 Stock Appreciation Rights, subject to adjustment as provided in the 1991 Plan. This grant shall be for a term commencing on the date hereof and ending on December 1, 2006. Grantee may exercise any Option in which Grantee is vested in accordance with the terms of the 1991 Plan by delivering written notice to the Corporate Secretary of the Company at the Company's office in Newport News, Virginia or such other address at which the Company may be located at the time, together with appropriate payment, as provided in such Plan, for the number of shares covered by such notice with respect to the exercise of an Option. Optionee acknowledges receipt of a copy of the 1991 Plan, and represents that he is familiar with its terms and provisions and accepts the option subject to all of its terms and provisions. Optionee has reviewed the 1991 Plan and the option in their entirety, and has had an opportunity to obtain the advice of counsel prior to executing this Agreement. Optionee accepts as binding, conclusive and final all decisions or interpretations of the Board of Directors upon any questions arising under the 1991 Plan, but with the understanding that the option has not been granted under the Plan, and accordingly optionee may be required to hold for two years before resale, any stock acquired upon exercise of the option, if such stock is not otherwise registered under the Securities Act of 1933. BLESSINGS CORPORATION By: /s/James P. Luke James P. Luke Executive Vice President Chief Financial Officer Date: December 2, 1996 ACCEPTED: /s/Michael C. Carlson GRANTEE Date: December 30, 1996 EX-99 2 PROVISIONS OF 1991 STOCK OPTION PLAN APPLICABLE TO MICHAEL CARLSON COMPENSATION CONTRACT PART I PURPOSES; DEFINITIONS; RESERVATION OF SHARES ARTICLE I The terms contained herein, the majority of which are identical to the terms of the Blessings Corporation 1991 Stock Option Plan (the "Plan"), shall apply to the Michael Carlson Compensation Contract dated December 2, 1996. ARTICLE II DEFINITIONS Certain terms used herein shall have the meaning below stated, subject to the provisions of Section 7.1. "Subsidiary" means any domestic or foreign corporation, at least fifty percent (50%) of the outstanding voting stock or voting power of which is beneficially owned directly or indirectly, by the Company. "Board" or "Board of Directors" means the Board of Directors of the Company. "Code" means the Internal Revenue Code of 1986, as amended. "Committee" means the committee appointed by the Board to administer the Plan pursuant to Article VII. "Common Stock" means, subject to the provisions of Section 9.3, the presently authorized common stock of the Company, par value $.71 per share. "Company" means Blessings Corporation, a Delaware corporation. "Disability" means (subject to Section 6.2) a physical or mental impairment of sufficient severity such that a Key Employee would be eligible for benefits under the Company's long term disability plan if the Key Employee had, at the time of such disability, been a participant under such plan "Fair Market Value" means the closing price at which the Common Stock of the Company shall have been sold regular way on the American Stock Exchange on the date as of which such value is being determined or, if no sales occurred on such day, then on the next preceding day on which there were such sales or, if at any time the Common Stock shall not be listed on the American Stock Exchange, the fair market value as determined by the Committee on the basis of available prices for such Common Stock or in such manner as may be authorized by applicable regulations under the Code. "Key Employee" means Michael Carlson. "Option" means a Non Statutory option to purchase Common Stock, granted by the Company to the Key Employee pursuant to Section 5.1, which is not an Incentive Stock Option as described in Section 422A of the Code. "Plan" means the Blessings Corporation 1991 Stock Option Plan. "Stock Appreciation Right" means a right, granted by the Company to the Key Employee pursuant to Section 5.3, to earn additional compensation for services rendered based upon the appreciation of the Fair Market Value of Common Stock. ARTICLE III RESERVATION OF SHARES Subject to adjustment under the provisions of Section 9.3 hereof, the maximum number of shares of Common Stock which may be issued and sold to the Key Employee pursuant hereto is 3,000 shares. Such shares may be either authorized and unissued shares or shares issued and thereafter acquired by the Company. Shares issued pursuant hereto shall be subject to all applicable provisions of the Certificate of Incorporation and Bylaws of the Company in existence at the time of issuance of such shares and at all times thereafter. ARTICLE IV PARTICIPATION 4.1 Eligibility to Receive Options and Stock Appreciation Rights. Options and Stock Appreciation Rights pursuant hereto may be granted only to the Key Employee . 4.2 Participation Not Guarantee of Employment. Nothing herein or in the instrument evidencing the grant of an Option or Stock Appreciation Right shall in any manner be construed to limit in any way the right of the Company or a Subsidiary to terminate the Key Employee's employment at any time without regard to the effect of such termination or any rights such Key Employee would otherwise have, or give any right to the Key Employee to remain employed by the Company or a Subsidiary thereof in any particular position or at any particular rate of compensation. PART II OPTIONS AND STOCK APPRECIATION RIGHTS; TERMINATIONS OF EMPLOYMENT AND DEATH ARTICLE V OPTIONS AND STOCK APPRECIATION RIGHTS 5.1 Grants of Options. (a) Option Price. The purchase price per share of Common Stock under each Option shall be determined by the Committee but shall be not less than 100% of the Fair Market Value per share of such Common Stock on the date the Option is granted. The Option Price may be subject to adjustment in accordance with the provisions of Section 9.3 hereof. (b) Option Agreements. Options and any Stock Appreciation Rights attached to such Options shall be evidenced by Option agreements in such form and containing such terms and conditions as the Committee shall approve, which terms and conditions need not be the same for all Options. (c) Options Nontransferable. An Option granted to the Key Employee shall by its terms be nontransferable by the Key Employee otherwise than by will or the laws of descent and distribution, and, during the lifetime of the Key Employee, shall be exercisable only by such Key Employee. No transfer of an Option by the Key Employee by will or by the laws of descent and distribution shall be effective to bind the Company unless the Company shall have been furnished with written notice thereof and a copy of the will and/or such other evidence as the Committee may determine necessary to establish the validity of the transfer. (d) Substitution and Cancellation. The Committee, in its sole discretion, may grant to the Key Employee who has been granted an Option pursuant hereto, in exchange for the surrender and cancellation of such Option, a new Option having a purchase price lower (or higher) than the purchase price provided in the Option so surren dered and cancelled and containing such other terms as the Committee may deem appropriate, subject to Section 5.1 (a). 5.2 Exercise of Options. (a) Term of Options; Vesting. The term of the Option and any related Stock Appreciation Right granted pursuant hereto shall not exceed ten (10) years from the date of grant. An Option granted shall become 100% vested at the earliest of the following times if the Key Employee is employed by the Company or a Subsidiary of the Company at such time: (i) the Key Employee's normal retirement date pursuant to the retirement plan of the Company or its Subsidiary applicable to the Key Employee, (ii) the Key Employee's death or Disability, (iii) in the event of a change in control of the Company (as set forth and defined in Section 5.2 (c), or (iv) one year from the date of grant. In its sole discretion, the Committee may prescribe a shorter time or accelerate the exercisability and vesting of any Option at any time. (b) Payment on Exercise. No shares of Common Stock shall be issued on the exercise of an Option unless paid for in full at the time of purchase as provided in the next sentence. Payment for shares of Common Stock purchased upon the exercise of an Option shall be made in cash or, with the consent of the Committee, in whole or in part in shares of Common Stock valued at the then Fair Market Value thereof or by delivery to the Com pany of a properly executed exercise notice together with irrevocable instructions to the Optionee's broker, which instructions and broker shall be satisfactory to the Company, to promptly deliver to the Company the total pur chase price for the shares of the Option being exercised from the sale or loan proceeds for such shares and the Company will deliver such shares directly to such broker in accordance with such procedures as the Committee may establish, which alternative forms of payment may be permitted by the Committee at the time the Option is granted or any time thereafter during the term of the Option. Such certificates for the shares of Common Stock so paid for will be issued and delivered to the person entitled thereto only at the Company's office in Newport News, Virginia. The Key Employee shall not have any rights as a shareholder with respect to any share of Common Stock covered by an Option unless and until such Key Employee shall have become the holder of record of such shares and, except as otherwise permitted in Section 9.3 hereof, no adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property or distributions or other rights) in respect of such share for which the record date is prior to the date on which such Key Employee shall have become the holder of record thereof. (c) In the event of a change in control of the Company (as hereafter defined), all Options then outstanding shall become fully (100%) vested and shall be exercisable immediately. As used herein, the term "change in control of the Company" shall be deemed to have occurred if (i) the Board of Directors determines, as a result of one or more transactions or events, that Williamson-Dickie Manufacturing Company no longer controls the Company; or (ii) upon the approval by the Company's shareholders of a sale or disposition of all or substantially all of the Company's assets or a plan of liquidation or dissolution of the Company. (d) If the Key Employee desires to exercise all or part of the Key Employee's currently exercisable Stock Appre ciation Rights in conjunction with the exercise of any exercisable options the Key Employee shall notify the Secre tary of the Company, in writing, of such intention and the number of Options and/or Stock Appreciation Rights which such Key Employee wishes to exercise. (The date of such notice shall be referred to herein as the "Election Date.") (e) In the event that the Key Employee exercises Stock Appreciation Rights, such Key Employee will receive an amount determined pursuant to the provisions of Section 5.3 (less applicable withholding taxes) within seven days of the Election Date. In the event that the Key Employee exercises Options, the Key Employee shall comply with all requirements set forth in the Option agreement in connection with the purchase of shares of Common Stock. 5.3 Stock Appreciation Rights Attached to Options. (a) Award. The Committee may award a Stock Appreciation Right with respect to any shares of Com mon Stock covered by any Option granted pursuant hereto and such Stock Appreciation Right (which shall not exceed 30% of the number of shares covered by any such Option) shall be granted only at the time of the grant of the related Option. A Stock Appreciation Right may be subject to such limitations and conditions as the Committee may determine in its discretion. (b) Terms and Conditions. Each Stock Appreciation Right shall be subject to the same terms and condi tions as the related Option with respect to the date of expiration, limitations on transferability and eligibility to exer cise; provided, however, that the Stock Appreciation Right exercised by a person subject to Section 16 (b) of the Securities Exchange Act of 1934, as amended, shall not be paid in whole or in part in unless the exercise occurs during the period beginning on the third business day and ending on the twelfth business day following the release of the Company's quarterly earnings. A Stock Appreciation Right may only be exercised at the same time as the related Option with which it was initially granted, and no Stock Appreciation Right may be exercised after the related Option becomes non exercisable. Stock Appreciation Rights shall be payable only in the form of cash. (c) Amount of Compensation. The amount of compensation which shall be payable to a Key Employee pursuant to the exercise of a Stock Appreciation Right shall be equal to the excess of the Fair Market Value of one share of Common Stock on the date the appropriate officer of the Company receives notice of the exercise of such Stock Appreciation Right over the purchase price per share under the related Option as determined under Section 5.1 (b) hereof multiplied by the number of Option shares with respect to which the Stock Appreciation Right is exercised. ARTICLE VI TERMINATION OF EMPLOYMENT AND DEATH 6.1 Termination of Employment. Unless earlier terminated in accordance with its terms, upon termination of the Key Employee's employment with the Company or any of its Subsidiaries, Options or Stock Appreciation Rights not theretofore vested and exercisable shall be forfeited. Any vested Option or vested Stock Appreciation Right shall terminate 90 days after any of the following: (a) Voluntary termination of employment by the Key Employee, with or without consent of the Company, (b) termination of employment of the Key Employee by the Company or any of its Subsidiaries, with or without cause, or (c) termination of employment of the Key Employee for any other reason including retirement under a retirement plan maintained by the Company, or because the Subsidiary employing such Key Employee ceases to be a Subsidiary of the Company and such Key Employee does not, prior thereto or contemporaneously therewith, become employed by the Company or of another Subsidiary. 6.2 Death or Disability of Optionee. If the Key Employee's employment is terminated as a result of Disability or death, the Key Employee or such Key Employee's legal representatives, shall be entitled to exercise the Options or Stock Appreciation Right in whole or in part at any time within one year following the Disability or death of the Key Employee, but in no event after expiration of the term of such Option or Stock Appreciation Right. 6.3 Employment. For all purposes herein, and under any Option or Stock Appreciation Right granted hereunder, "employment" shall be defined in accordance with the provisions of Section 1.421-7(h) of the Income Tax Regulations (or any successor regulations). PART III ADMINISTRATION, AMENDMENT AND TERMINATION; MISCELLANEOUS ARTICLE VII ADMINISTRATION 7.2 Liability of Committee. No member of the Committee shall be liable for anything done or omitted to be done by such member or by any other member of the Committee in connection with any award hereunder, except for the willful misconduct or gross negligence of such member. The Committee shall have power to engage outside consult ants, auditors or other professional help to assist in the fulfillment of the Committee's duties hereunder at the Company's expense. 7.3 Determinations of the Committee. The Committee shall determine the form of Option agreements to be issued pursuant hereto and the terms and conditions to be included therein, provided such terms and conditions are not inconsistent with the provisions set forth herein. The Committee may, in its discretion or in accordance with a direction from the Board, waive any provisions of any Option agreement, provided such waiver is not inconsistent with the provisions set forth herein. ARTICLE VIII AMENDMENT The terms hereof may be amended at any time and from time to time by the Board of Directors of the Company. No termination or amendment of the provisions hereof, without the consent of the Key Employee, may terminate such holder's Option or Stock Appreciation Right or materially and adversely affect such holder's rights thereunder. ARTICLE IX MISCELLANEOUS PROVISIONS 9.1 Restrictions Upon Grant of Options and Stock Appreciation Rights. The listing upon the American Stock Exchange or the registration or qualification under any Federal or State law of any shares of Common Stock to be granted pursuant hereto (whether to permit the grant of Options or Stock Appreciation Rights or the resale or other disposition of any such shares of Common Stock by or on behalf of the Key Employee receiving such shares) may be necessary or desirable and, in any such event, delivery of the certificates for such shares of Common Stock shall, if the Board of Directors, in its sole discretion, shall determine, not be made until such listing, registration or qualification shall have been completed. In such connection, the Company agrees that it will use its best efforts to effect any such listing, registration or qualification, provided, however, that the Company shall not be required to use its best efforts to effect such registration under the Securities Act of 1933 ("1933 Act"), other than on Form S 8, as presently in effect, or such other forms as may be in effect from time to time calling for information comparable to that presently required to be furnished under Form S-8. 9.2 Restrictions upon Resale of Unregistered Stock. If the shares of Common Stock that have been transferred to the Key Employee pursuant hereto are not registered under the 1933 Act, pursuant to an effective registration statement, such Key Employee, if the Committee shall deem it advisable, may be required to represent and agree in writing (i) that any shares of Common Stock acquired by the Key Employee pursuant hereto will not be sold except pursuant to an effective registration statement under the 1933 Act and (ii) that such Key Employee is acquiring such shares of Common Stock for such Key Employee's own account and not with a view to the distribution thereof. 9.3 Adjustments. In the event of any change (through recapitalization, merger, consolidation, stock dividend, split up combination or exchanges of shares or otherwise) in the character or amount of the Company's capital stock (or any other transaction described in Section 425(a) of the Code) after any Option or Stock Appreciation Right is granted hereunder and prior to the exercise thereof, (i) the Option, to the extent that it has not been exercised, shall entitle the holder to such number and kind of securities as such holder would have been entitled to had such holder actually owned the stock subject to the Option at the time of the occurrence of such change; and (ii) any outstanding Stock Appreciation Rights shall be similarly adjusted. If any such event should occur, the number of Stock Appreciation Rights and shares subject to Option which are authorized to be issued hereunder, but which have not been issued, shall be similarly adjusted. If any other event shall occur, prior to the exercise of an Option granted to the Key Employee hereunder, which shall increase or decrease the amount of capital stock outstanding and which the Committee, in its sole discretion, shall determine equitably requires an adjustment in the number of shares which the holder should be permitted to acquire or the number of Stock Appreciation Rights such holder should be entitled to exercise, such adjustment as the Committee shall determine may be made, and when so made shall be effective and binding for all purposes. 9.4 Withholding of Taxes. The Key Employee, upon exercise of an Option to purchase Common Stock or Stock Appreciation Rights shall agree to pay to the Company, or make arrangements (including withholding of shares of Common Stock purchased upon exercise of the Option at the Fair Market Value thereof) satisfactory to the Committee regarding payment of any taxes of any kind required by law to be withheld with respect to the transfer of such Key Employee of such shares of Common Stock. 9.5 Use of Proceeds. The proceeds from the sale of Common Stock pursuant to Options granted pursuant hereto shall constitute general funds of the Company and may be used for such corporate purposes as the Company may determine. 9.6 Other Benefits. Nothing contained herein shall prevent the Company from establishing other incentive plans in which the Key Employee may also participate. No award pursuant hereto shall be considered as compensation in calculating any insurance pension or other benefit for which the recipient is eligible unless any such insurance, pension or other benefit is granted under a plan which expressly provides that compensation pursuant hereto (and specifying the type of such compensation) shall be considered as compensation under such plan. 9.7 Board Action. Any action authorized to be taken hereunder by the Committee may be taken by the Board. -----END PRIVACY-ENHANCED MESSAGE-----