-----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, WGLOx4zVWALmCanLJhcyqmD3iH2Q6/LsFoR9yGwx3Mf9XPOSMosh1QKoPbx7yQf2 /kj8uJWaNpGMgDxjQtGjeA== 0000740126-97-000033.txt : 19971224 0000740126-97-000033.hdr.sgml : 19971224 ACCESSION NUMBER: 0000740126-97-000033 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19971223 EFFECTIVENESS DATE: 19971223 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FINGERHUT COMPANIES INC CENTRAL INDEX KEY: 0000740126 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-CATALOG & MAIL-ORDER HOUSES [5961] IRS NUMBER: 411396490 STATE OF INCORPORATION: MN FISCAL YEAR END: 1228 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-43013 FILM NUMBER: 97742874 BUSINESS ADDRESS: STREET 1: 4400 BAKER RD CITY: MINNETONKA STATE: MN ZIP: 55343 BUSINESS PHONE: 6129323100 MAIL ADDRESS: STREET 2: 4400 BAKER ROAD CITY: MINNETONKA STATE: MN ZIP: 55343 S-8 1 As filed with the Securities and Exchange Commission on December 23, 1997 Registration No. 333-_____ _____________________________________________________________________________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON D.C. 20549 _______________ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 _______________ FINGERHUT COMPANIES, INC. (Exact name of registrant as specified in its charter) Minnesota 41-1396490 (State of (I.R.S. Employer Incorporation) Identification No.) 4400 Baker Road Minnetonka, Minnesota 55343 (Address of Principal Executive Offices) Fingerhut Companies, Inc. Performance Enhancement Investment Plan (Full Title of the Plan) _______________ Michael P. Sherman, Esq. Fingerhut Companies, Inc. 4400 Baker Road Minnetonka, Minnesota 55343 (Name and address of agent for service (612) 932-3585 (Telephone Number of Agent for Service) CALCULATION OF REGISTRATION FEE Proposed Proposed Title of Amount to Maximum Maximum Amount Securities to be be Offering Aggregate of Registered Registered Price Per Offering Registration Share (1) Price Fee Common Stock, par value $.01 per 90,994 $19.46875 $1,771,539 $522.60 share. . . . . . . shares(2) (1) Estimated solely for the purpose of determining the registration fee pursuant to Rule 457(h) under the Securities Act of 1933, and based on the average of the high and low sale prices as reported on the New York Stock Exchange composite tape on December 18, 1997. (2) This registration statement also covers such additional number of shares as may be issuable or saleable by reason of the operation of the antidilution provisions of the Fingerhut Companies, Inc. 1994 Employee Stock Purchase Plan. ____________________________________________________________________________ PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference The following documents filed by the Registrant with the Securities and Exchange Commission are incorporated by reference in this registration statement: a. Annual Report on Form 10-K for the fiscal year ended December 27, 1996; b. Quarterly Reports on Forms 10-Q for the quarters ended March 28, 1997, June 27, 1997 and September 26, 1997; and c. The description of the Registrant's Common Stock, contained in the Company's Registration Statement on Form 8-A (File No. 1-8668) filed pursuant to Section 12 of the Securities Exchange Act of 1934 and declared effective on April 25, 1990. All documents filed by the Registrant (File No. 1-8668) pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing of such documents. Item 4. Description of Securities Not Applicable. Item 5. Interests of Named Experts and Counsel Michael P. Sherman, General Counsel of the Registrant, has given his opinion on the legality of the securities being registered hereunder. Mr. Sherman beneficially owns 27,500 shares of Common Stock of the Registrant, including 27,000 shares that he has the right to acquire through exercise of stock options. Item 6. Indemnification of Directors and Officers. Section 521 of the Minnesota Business Corporation Act (the "MBCA") (Minn. Stat. 302A.521) generally provides that unless its articles or bylaws provide otherwise, a corporation shall indemnify officers and directors made or threatened to be made a party to a proceeding by reason of any such person's present or former official capacity as a director or officer against 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, if, with respect to the acts or omissions of the person complained of in the proceeding, the person: (1) has not been indemnified by another party for the same amounts 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 the procedures for director conflicts of interest, if applicable, have been satisfied; (4) in the case of a criminal proceeding, had no reasonable cause to believe the conduct was unlawful; and (5) reasonably believed that the conduct was in the best interests of the corporation. The MBCA provides that unless a corporation's articles of incorporation or bylaws provide otherwise, if a person is made or threatened to be made a party to a proceeding, the person is entitled, upon written request to the corporation, to payment or reimbursement by the corporation of reasonable expenses, including attorneys' fees and disbursements, incurred by the person in advance of the final disposition of the proceeding (a) upon receipt by the corporation of a written affirmation by the person of a good faith belief that the criteria for indemnification have been satisfied and a written undertaking by the person to repay all amounts so paid or reimbursed by the corporation, if it is ultimately determined that the criteria for indemnification have not been satisfied, and (b) after a determination that the facts then known to those making the determination would not preclude indemnification. The MBCA also permits a corporation to purchase and maintain insurance on behalf of a person in that person's official capacity against any liability asserted against and incurred by the person in or arising from that capacity, whether or not the corporation would have been required to indemnify the person against the liability. The Bylaws of the Registrant provide for indemnification of its officers and directors to the fullest extent permitted under the MBCA. The Registrant currently maintains a policy insuring, subject to certain exceptions, its directors and officers and the directors and officers of its subsidiaries against liabilities which may be incurred by such persons acting in such capacities. Item 7. Exemption from Registration Claimed. Not Applicable. Item 8. Exhibits Exhibit Number Description of Exhibit 5 Opinion of Michael P. Sherman, Esq. 10 Fingerhut Companies, Inc. Performance Enhancement Incentive Plan. 24(a) Consent of KPMG Peat Marwick LLP. 24(b) Consent of Michael P. Sherman, Esq. (included with Exhibit 5). 25 Powers of Attorney (included on Page 5). 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; (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 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a) (1) (i) and (a) (1) (ii) do not apply if the registration statement is on Form S-3, Form S-8 or Form F-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or 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 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 15(d) of the Securities Exchange Act of 1934 (and where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer of controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Minnetonka, State of Minnesota, on December 22, 1997. FINGERHUT COMPANIES, INC. By /s/ Theodore Deikel Theodore Deikel (Chairman of the Board, Chief Executive Officer and President) POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Theodore Deikel and Michael P. Sherman and each of them, his or her true and lawful attorneys-in-fact and agents with full power and substitution and resubstitution, for such person 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 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 or necessary to be done in and about the premises, as fully to all intents and purposes and he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their, or his or her 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 and on the dates indicated. Signature Title Date /s/ Theodore Deikel Chairman of the Board, December 22, 1997 Theodore Deikel Chief Executive Officer and President; and Director (Principal Executive Officer) /s/ Gerald T. Knight Senior Vice President, December 22, 1997 Gerald T. Knight Chief Financial Officer (Principal Financial Officer) /s/ Thomas C. Vogt Corporate Controller December 19, 1997 Thomas C. Vogt (Principal Accounting Officer) /s/ Wendell S. Anderson Director December 18, 1997 Wendell R. Anderson /s/ Edwin C. Gage Director December 22, 1997 Edwin C. Gage /s/ Stanley S. Hubbard Director December 18, 1997 Stanley S. Hubbard /s/ Kenneth A. Macke Director December 18, 1997 Kenneth A. Macke /s/ Dudley C. Mecum Director December 18, 1997 Dudley C. Mecum /s/ John M. Morrison Director December 18, 1997 John M. Morrison /s/ Christina L. Shea Director December 19, 1997 Christina L. Shea EX-5 2 December 22, 1997 Fingerhut Companies, Inc. 4400 Baker Road Minnetonka, Minnesota 55343 Re: Registration Statement on Form S-8 Gentlemen and Ladies: As General Counsel of Fingerhut Companies, Inc. (the "Company") and head of its Legal Department, I am delivering this opinion in connection with the preparation of a Registration Statement on Form S-8 (the "Registration Statement"), relating to the registration of 90,994 shares of the Company's common stock, $.01 par value per share (the "Common Stock"), issuable pursuant to the Fingerhut Companies, Inc. Performance Enhancement Investment Plan (the "Plan"). In that regard, I or attorneys on my staff have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments and certificates as we have deemed necessary for purposes of this opinion, including the following: (a) The Company's Articles of Incorporation, as amended through the date hereof; (b) The Company's Bylaws, as amended through the date hereof; (c) Certain corporate resolutions, including resolutions of the Company's shareholders and/or Board of Directors pertaining to the Plan; (d) The Plan; and (e) The Registration Statement as it is currently proposed to be filed with the Securities and Exchange Commission. Based on the foregoing, I am of the opinion that: 1. The Company was duly incorporated under the laws of the State of Minnesota and is now a validly organized and existing corporation under the laws of that State. 2. The shares of Common Stock which are being registered pursuant to the Registration Statement have been duly authorized and, when issued pursuant to the terms of the Plan, will be validly issued, fully paid and nonassessable. I hereby consent to the filing of this opinion as an exhibit to the Registration Statement. Sincerely, /s/Michael P. Sherman Michael P. Sherman General Counsel EX-24 3 Exhibit 24(a) Consent of Independent Certified Public Accountants The Board of Directors Fingerhut Companies, Inc. We consent to incorporation by reference to the registration statement on Form S-8 of Fingerhut Companies, Inc. and subsidiaries of our reports dated January 22, 1997 relating to the consolidated statements of financial position of Fingerhut Companies, Inc. as of December 27, 1996 and December 29, 1995 and the related consolidated statements of earnings, changes in stockholders' equity and cash flows and the related financial statement schedule for each of the years in the three-year period ended December 27, 1996, which reports appear in or are incorporated by reference in the December 27, 1996 annual report on Form 10-K of Fingerhut Companies, Inc. Minneapolis, Minnesota December 22, 1997 EX-10 4 FINGERHUT COMPANIES, INC. PERFORMANCE ENHANCEMENT INVESTMENT PLAN 1. Purpose of Plan. This Plan shall be known as the "FINGERHUT COMPANIES, INC. PERFORMANCE ENHANCEMENT INVESTMENT PLAN" and is hereinafter referred to as the "Plan." The purpose of the Plan is to aid in maintaining and developing personnel capable of ensuring the future success of Fingerhut Companies, Inc., a Minnesota corporation (the "Company"), to offer such personnel additional incentives to put forth maximum efforts for the success of the business, and to afford them an opportunity to acquire a proprietary interest in the Company through the purchase of stock options as provided herein. Options granted under this Plan shall be options which do not qualify as incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986 (the "Code"). 2. Stock Subject to Plan. Subject to the provisions of Section 15 hereof, the stock to be subject to options under the Plan shall be the Company's authorized common stock, par value $0.01 per share (the "Common Stock"). Subject to adjustment as provided in Section 15 hereof, a maximum of 1,500,000 shares of Common Stock shall be reserved for issuance upon exercise of options granted under the Plan. If any options granted under the Plan expire, or for any reason are terminated or unexercised, such options shall again be available for grant hereunder during the term of the Plan. 3. Administration of Plan. (a) The Plan shall be administered by the Compensation Committee of the Board of Directors (the "Committee"). (b) The Committee shall have plenary authority in its discretion, but subject to the express provisions of the Plan: (i) to determine the purchase price to be paid for each option and units of options, (ii) to determine the purchase price of the shares of Common Stock covered by each option, (iii) to determine the employees and others to whom and the time or times at which such options shall be made available for purchase and the number of shares to be subject thereto, (iv) to determine the terms of exercise of each option, (v) to accelerate the time at which all or any part of an option vests and may be exercised, (vi) to amend or modify the terms of any option with the consent of the optionee, (vii) to interpret the Plan, (viii) to prescribe, amend and rescind rules and regulations relating to the Plan, (ix) to determine the terms and provisions of each option agreement under the Plan (which agreements need not be identical), and (x) to make all other determinations necessary or advisable for the administration of the Plan, subject to the authority of the Board of Directors under Section 16 hereof to amend or terminate the Plan. The Committee's determinations on the foregoing matters, subject only to the delegation of authority to the Committee by the Board of Directors of the Company, shall be final and conclusive. (c) The Committee may select one of its members as its Chairman and shall hold its meetings at such times and places as it may determine. A majority of its members shall constitute a quorum. All determinations of the Committee shall be made by not less than a majority of its members. Any decision or determination reduced to writing and signed by all of the members of the Committee shall be fully effective as if it had been made by a majority vote at a meeting duly called and held. The sale of an option by the Company to an optionee hereunder shall be effective only if a written agreement shall have been duly executed and delivered by and on behalf of the Company upon the grant of such option, and the optionee elects to purchase such option by executing such agreement and pays to the Company the purchase price therefor in full in accordance with the terms of the Plan. The Committee may appoint a Secretary and may make such rules and regulations for the conduct of its business as it shall deem advisable. 4. Eligibility. Options may only be offered under this Plan to any full or part-time employee (which term as used herein includes, but is not limited to, officers and directors who are also employees) of the Company and of its present and future subsidiary corporations within the meaning of Section 424(f) of the Code (herein called "subsidiaries"), and any consultants or independent contractors to the Company or one of its subsidiaries. In determining the persons to whom options shall be offered and the number of shares of Common Stock covered by such options, the Committee may take into account the nature of services rendered by the respective employees or consultants, their present and potential contributions to the success of the Company and such other factors as the Committee in its discretion shall deem relevant. A person who has been offered or has purchased options under this Plan may be offered additional options under the Plan if the Committee shall so determine. Nothing in the Plan or in any agreement thereunder shall confer on any employee any right to continue in the employ of the Company or any of its subsidiaries or affect, in any way, the right of the Company or any of its subsidiaries to terminate his or her employment at any time. 5. Purchase of Options. The Committee may grant options under the Plan from time to time prior to June 1, 1996. When the Committee elects to grant options to an employee or consultant (the "offeree"), the offeree shall have 30 days from the date of the offer (the "Offer Date") to elect to purchase such options. The Committee may in its discretion extend the time period within which the offeree must pay the purchase price for such options to the Company. All options granted under the Plan shall be offered in units consisting of four options with the respective vesting periods and exercise prices described in Section 6 below. An offeree may elect to purchase less than all of the units of options offered, but the offer to sell the units to the offeree shall lapse on the 31st day following the Offer Date as to any units that the offeree has not elected to purchase. The units not purchased by an offeree shall again be available for grant hereunder. The purchase price for units shall be established by the Committee on the Offer Date. 6. Exercise Price. The exercise price for options comprising units sold under the Plan shall be 110%, 120%, 130% and 140%, respectively, of the fair market value of the Common Stock on the Offer Date. For purposes of the preceding sentence and for all other valuation purposes under the Plan, the "fair market value" of the Common Stock shall be the last sale price of the Common Stock on the trading day preceding the Offer Date, or as otherwise reasonably determined by the Committee. If the Common Stock is not traded on an established securities market, the Committee shall make a good faith attempt to determine the fair market value of the Common Stock, and such determination shall be final and conclusive. 7. Vesting. Subject to the authority of the Committee to accelerate the vesting of options, 25% of all of the options within each unit sold shall vest and become exercisable on the first anniversary of the Offer Date, and thereafter, an additional 25% shall vest and become exercisable on the second, third and fourth anniversary dates, respectively. 8. Term. Each option and all rights and obligations thereunder shall expire on the seventh anniversary of the Offer Date. 9. Exercise of Option or Award. (a) The Committee shall have full and complete authority to provide for the acceleration of vesting and the exercise of options upon the occurrence of such events (including, without limitation, changes of control of the Company, changes of circumstances relating to the Plan or the participant, changes in securities or financial markets, or otherwise) and at such times during the term of the options as the Committee may determine to be necessary or appropriate under the circumstances. (b) The exercise of any option sold hereunder shall only be effective at such time as the shares of Common Stock covered by such option will not violate any state or federal securities or other laws. (c) An optionee electing to exercise an option shall give written notice to the Company of such election and of the number of shares of Common Stock subject to such election. The full purchase price of such shares shall be tendered with such notice of exercise. Payment shall be made to the Company in cash (including bank check, certified check, personal check, or money order), or, at the discretion of the Committee, (i) by delivering certificates for Common Stock already owned by the optionee having a fair market value as of the date of exercise at least equal to the full purchase price of the shares, or (ii) by delivering the optionee's promissory note, which shall provide for interest at a rate not less than the minimum rate required to avoid the imputation of income, original issue discount or a below-market-rate loan pursuant to Sections 483, 1274 or 7872 of the Internal Revenue Code or any successor provisions thereto, or (iii) a combination of cash, the optionee's promissory note and such shares. The fair market value of any such tendered shares shall be determined as provided in Section 5 herein. The optionee's promissory note shall be a full recourse liability of the optionee and may, at the discretion of the Committee, be secured by a pledge of the shares being purchased. Until such person has been issued the shares of Common Stock following exercise and payment of the exercise price, he or she shall not possess any rights as a shareholder with respect to such shares. 10. Return of Purchase Price. If any option expires unexercised, the offeree shall be entitled to return of the purchase price paid therefor, but only if the fair market value of the Common Stock (determined in accordance with Section 5) on the date of expiration exceeds the fair market value of the Common Stock on the Offer Date. If, on the date of expiration of an option, the fair market value of the Common Stock is less than that on the Offer Date, then the optionee shall be entitled to the return of only that portion of the purchase price applicable to such option as is equal to the percentage obtained by dividing the fair market value of the Common Stock on the date of expiration by the fair market value on the Offer Date, after giving effect to such adjustments as the Committee determines to be required to reflect payment of dividends and other changes to the capital of the Company occurring after the Offer Date. 11. Additional Restrictions. The Committee shall have full and complete authority to determine whether all or any part of the shares of Common Stock acquired upon exercise of any of the options sold under the Plan shall be subject to restrictions on transferability or any other restrictions affecting in any manner the optionee's rights with respect thereto, but any such restriction shall be contained in the agreement relating to such options. 12. Non-Transferability. No option granted under the Plan shall be transferable by an optionee otherwise than by will or the laws of descent or distribution. Except as otherwise provided in an option agreement, during the lifetime of an optionee, the option shall be exercisable only by such optionee. 13. Dilution or Other Adjustments. If there shall be any change in the Common Stock through merger, consolidation, reorganization, recapitalization, dividend in the form of stock (of whatever amount), stock split or other change in the corporate structure, appropriate adjustments in the Plan and any outstanding options shall be made by the Committee. In the event of any such changes, adjustments shall include, as appropriate, changes in the aggregate number of shares of Common Stock issuable upon exercise of the options, the price per share of Common Stock covered by outstanding options, the exercise price of options, and such other adjustments as may be appropriate or required to prevent dilution or enlargement of option rights. 14. Amendment or Discontinuance of Plan. The Board of Directors may amend or discontinue the Plan at any time; provided, however, that without shareholder approval (except as provided in Section 15) no amendment of the Plan shall (i) increase the maximum number of shares of Common Stock reserved for issuance under the Plan or (ii) extend the maximum term of options permitted under Section 8. No option granted under the Plan may be altered or impaired without the consent of the holder of the option. 15. Time of Offer. Nothing contained in the Plan or in any resolution adopted or to be adopted by the Board of Directors, the Compensation Committee of the Board, or the shareholders of the Company, and no action taken by the Committee or the Board of Directors shall constitute the sale of an option hereunder, other than the election by an offeree to purchase units of options granted by the Committee hereunder and payment of the purchase price therefor. 16. Effective Date and Termination of Plan. (a) The Plan was approved by the Board of Directors on March 12, 1993, and is subject to approval by the shareholders of the Company within twelve (12) months thereafter. (b) Unless the Plan shall have been discontinued as provided in Section 16 hereof, the Plan shall terminate March 12, 2003. No option may be granted after such termination, but termination of the Plan shall not, without the consent of the optionee, alter or impair any rights or obligations under any option theretofore granted. -----END PRIVACY-ENHANCED MESSAGE-----