-----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, UQ5m8Wm00yC+ppbslI4RUWfX4nRa/UO5kBRua1IWxkkGCMW6dnmdr89ML+k1xQoX H9D3eV4bBvYelGhSmO4EZw== 0000950144-96-009360.txt : 19961231 0000950144-96-009360.hdr.sgml : 19961231 ACCESSION NUMBER: 0000950144-96-009360 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19961227 EFFECTIVENESS DATE: 19961227 SROS: BSE SROS: CSE SROS: CSX SROS: NYSE SROS: PHLX FILER: COMPANY DATA: COMPANY CONFORMED NAME: SCIENTIFIC ATLANTA INC CENTRAL INDEX KEY: 0000087777 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 580612397 STATE OF INCORPORATION: GA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-18891 FILM NUMBER: 96687029 BUSINESS ADDRESS: STREET 1: ONE TECHNOLOGY PKWY S CITY: NORCROSS STATE: GA ZIP: 30092-2967 BUSINESS PHONE: 7709035000 MAIL ADDRESS: STREET 1: ONE TECHNOLOGY PKWY S CITY: NORCROSS STATE: GA ZIP: 30092-2967 FORMER COMPANY: FORMER CONFORMED NAME: SCIENTIFIC ASSOCIATES INC DATE OF NAME CHANGE: 19671024 S-8 1 1996 EMPLOYEE STOCK OPTION PLAN 1 As filed with the Securities and Exchange Commission on December 27, 1996 Registration No. 333- ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Scientific-Atlanta, Inc. (Exact Name of Registrant as Specified in Its Charter) GEORGIA 58-0612397 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) ONE TECHNOLOGY PARKWAY, SOUTH 30092 NORCROSS, GEORGIA (Zip Code) (Address of Principal Executive Offices) NON-QUALIFIED STOCK OPTION AGREEMENT WITH EMPLOYEE (Full Title of the Plan) James F. McDonald Please address a copy of all communications Chief Executive Officer to: Scientific-Atlanta, Inc. William E. Eason, Jr., Esq. One Technology Parkway, South Scientific-Atlanta, Inc. Norcross, Georgia 30092 One Technology Parkway, South (Name and Address of Agent For Service) Norcross, Georgia 30092 Telephone: (770) 903-5000 (770) 903-5000 (Telephone Number, Including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE ============================================================================================================= Proposed Proposed Title of Maximum Maximum Securities Amount Offering Aggregate Amount of to be to be Price Offering Registration Registered Registered Per Share(1) Price Fee - ------------------------------------------------------------------------------------------------------------- Common Stock, Par Value $0.50 100,000 $17-7/8 $1,787,500 $542 Per Share shares =============================================================================================================
(1) Calculated pursuant to Rule 457(h)(1), based on an option exercise price of $17-7/8 per share as set forth in the Non-Qualified Stock Option Agreement. 2 PART I INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS ITEM 1. PLAN INFORMATION* ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION* * Information required by Part I to be contained in the Section 10(a) prospectus is omitted from the Registration Statement in accordance with Rule 428 under the Securities Act of 1933 and the Note to Part I of Form S-8. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE The following documents are incorporated herein by reference: (a) The Registrant's annual report for the fiscal year ended June 28, 1996 filed pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act"); (b) 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 Registrant's annual report referred to in (a) above; and (c) The description of the Registrant's common stock, par value $0.50 per share, which is contained in its registration statement on Form 10 filed under Section 12 of the Exchange Act, and the description of the rights to purchase Common Stock, which is contained in its registration statement on Form 8-A filed under Section 12 of the Exchange Act, including any amendments or reports filed for the purpose of updating such descriptions. All documents subsequently filed with the Commission by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective amendment to this Registration Statement 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 into 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 Mr. Eason, an executive officer of the Registrant, is also a partner at the law firm of Paul, Hastings, Janofsky & Walker LLP, which firm performs legal services for the Registrant. Mr. Eason receives a fixed salary from the firm for work which he performs for clients of the firm other than the Registrant, but has no interest in the firm's earnings and profits. -2- 3 ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS Sections 14-2-850 through 14-2-859 of the Georgia Business Corporation Code provide for the indemnification of officers and directors under certain circumstances against reasonable expenses incurred in defending against a claim and authorizes Georgia corporations to indemnify their officers and directors under certain circumstances against reasonable expenses and liabilities incurred in legal proceedings involving such persons because of their being or having been an officer or director. The By-laws of the Registrant provide for indemnification of its officers and directors to the full extent authorized by such sections. ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED Not applicable. ITEM 8. EXHIBITS The exhibits filed as part of this Registration Statement are as follows:
Exhibit Number Description of Exhibit - -------------- ---------------------- 4 Non-Qualified Stock Option Agreement between Scientific-Atlanta, Inc. and James F. McDonald 5 Opinion of Paul, Hastings, Janofsky & Walker LLP as to the legality of the securities being registered 23.1 Consent of Arthur Andersen LLP 23.2 Consent of Paul, Hastings, Janofsky & Walker LLP to the filing and use of their opinion relating to the legality of the securities (contained in opinion filed as Exhibit 5) 24 Power of Attorney authorizing James F. McDonald and Harvey A. Wagner to sign amendments to this Registration Statement on behalf of officers and directors of the Registrant (contained on Signature Page of Registration Statement)
ITEM 9. UNDERTAKINGS (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to 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. (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. -3- 4 (4) That, for the 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 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. (b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. -4- 5 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 Gwinnett County, State of Georgia, on this 12th day of December, 1996. SCIENTIFIC-ATLANTA, INC. By:/s/James F. McDonald --------------------------------- JAMES F. MCDONALD, PRESIDENT AND CHIEF EXECUTIVE OFFICER POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints James F. McDonald and Harvey A. Wagner, jointly and severally, his or her attorneys-in-fact, each with power of substitution for him or her in any and all capacities, to sign any amendments to this Registration Statement, and to file the same, with the exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may 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 below by the following persons in the capacities and on the date indicated. /s/James F. McDonald December 12, 1996 - ------------------------------------------------ --------------------- JAMES F. MCDONALD, PRESIDENT AND CHIEF Date EXECUTIVE OFFICER AND DIRECTOR (PRINCIPAL EXECUTIVE OFFICER) /s/Harvey A. Wagner December 12, 1996 - ------------------------------------------------ --------------------- HARVEY A. WAGNER, SENIOR VICE PRESIDENT-FINANCE, Date CHIEF FINANCIAL OFFICER AND TREASURER (PRINCIPAL FINANCIAL OFFICER) /s/Julian W. Eidson December 12, 1996 - ------------------------------------------------ --------------------- JULIAN W. EIDSON Date VICE PRESIDENT AND CONTROLLER (PRINCIPAL ACCOUNTING OFFICER)
[Signatures continued on next page] 6 [Signatures continued from preceding next page] /s/Marion H. Antonini December 12, 1996 - ------------------------------------------------ --------------------- MARION H. ANTONINI Date DIRECTOR /s/William E. Kassling December 12, 1996 - ------------------------------------------------ --------------------- WILLIAM E. KASSLING Date DIRECTOR /s/Wilbur Branch King December 12, 1996 - ------------------------------------------------ --------------------- WILBUR BRANCH KING Date DIRECTOR /s/Mylle Bell Mangum December 12, 1996 - ------------------------------------------------ --------------------- MYLLE BELL MANGUM Date DIRECTOR /s/Alonzo L. McDonald December 12, 1996 - ------------------------------------------------ --------------------- ALONZO L. MCDONALD Date DIRECTOR /s/David J. McLaughlin December 12, 1996 - ------------------------------------------------ --------------------- DAVID J. MCLAUGHLIN Date DIRECTOR /s/James V. Napier December 12, 1996 - ------------------------------------------------ --------------------- JAMES V. NAPIER Date DIRECTOR /s/Sidney Topol December 12, 1996 - ------------------------------------------------ --------------------- SIDNEY TOPOL Date DIRECTOR
7 EXHIBIT INDEX
Exhibits - -------- 4. Non-Qualified Stock Option Agreement between Scientific-Atlanta, Inc. and James F. McDonald 5. Opinion of Paul, Hastings, Janofsky & Walker LLP as to the legality of the securities being registered 23.1 Consent of Arthur Andersen LLP 23.2 Consent of Paul, Hastings, Janofsky & Walker LLP to the filing and use of their opinion relating to the legality of the securities (contained in opinion filed as Exhibit 5) 24. Power of Attorney authorizing James F. McDonald and Harvey A. Wagner to sign amendments to this Registration Statement on behalf of officers and directors of the Registrant (contained on Signature Page of Registration Statement)
EX-4 2 SCIENTIFIC ATLANTA, INC AND JAMES F. MCFARLAND AGR 1 EXHIBIT 4 EXECUTION ORIGINAL NON-QUALIFIED STOCK OPTION AGREEMENT This Option Agreement (the "Agreement") is made and entered into as of the 13th day of November, 1996, by and between Scientific-Atlanta, Inc., a Georgia corporation (the "Company"), and James F. McDonald (the "Optionee"). R E C I T A L S: WHEREAS, the Company desires to grant the Optionee an Option (as defined below); and WHEREAS, the parties hereto desire to set forth herein the terms and conditions applicable to such Option; NOW, THEREFORE, the parties hereto do hereby agree as follows: 1. Definitions. Each capitalized term used herein which is not otherwise defined herein shall have the meaning ascribed to such term in Schedule 1 attached hereto. 2. Grant. The Company hereby grants to the Optionee an option (the "Option") to purchase from the Company 100,000 shares of the $0.50 par value common stock of the Company ("Common Stock") at an exercise price of $17 - 7/8 per share, which exercise price is subject to adjustment as provided in Paragraph 11 hereof. The Option is intended to be treated as a non-qualified stock option for all purposes and is not intended to qualify as an incentive stock option for purposes of the Code. 3. Term. The term of the Option shall commence on the date hereof ("Date of Grant") and shall terminate and expire, to the extent not previously exercised, on November 12, 2006. 4. Vesting; Limitation on Right to Exercise. Except as otherwise set out in this Agreement, the Optionee shall have the right to exercise the Option on and after May 13, 2001, but the Optionee shall have the right to earlier exercise the Option on and after November 13, 1998, in the following percentages, provided that the specified events have been satisfied: (a) fifty percent (50%) of the shares subject to the Option shall be exercisable if the closing price of the Common Stock of the Company, as reported by the New York Stock Exchange, has been $27.00 per share or more for twenty (20) consecutive business days at any time after the Date of Grant of the Option; or 2 (b) one hundred percent (100%) of the shares subject to the Option shall be exercisable if the closing price of the Common Stock of the Company, as reported by the New York Stock Exchange, has been $35.00 per share or more for more than twenty (20) consecutive business days at any time after the Date of Grant of the Option. The targeted per share closing prices set forth in Subparagraphs (a) and (b) above shall be appropriately adjusted in the event of any change of the type described in Paragraph 11 of this Agreement. Notwithstanding that the Optionee may have the right, pursuant to the above provisions, to exercise the Option as to some or all of the shares subject to the Option, Optionee agrees that he will not exercise the Option as to any shares subject to the Option until such time as (i) Optionee is no longer an employee of the Company and (ii) such exercise will not cause the Company to lose, pursuant to the terms of Section 162 (m) of the Code, the right to deduct from the Company's income, for federal income tax purposes, the compensation to the Optionee resulting from such exercise. 5. Manner of Exercise of the Option. The Option may be exercised from time to time, in whole or in part, by delivering a written notice of exercise to the Corporate Secretary of the Company. Such notice is irrevocable and must be accompanied by full payment of the purchase price (i) in cash, (ii) by delivery of shares of Common Stock at the Fair Market Value of such shares determined as of the exercise date, or a combination of (i) and (ii). 6. Cessation of Employment; etc. After the Optionee ceases to be an employee, his rights to exercise any unexercised Option then held by him shall be determined as provided in this Paragraph 6. The Option may not be exercised after the term set forth in Paragraph 3 expires or after the Option is otherwise canceled. (a) Retirement. If the Optionee ceases to be an employee because of Retirement (and not on account of termination for "cause" (as hereinafter defined)),the Optionee shall have the right to exercise the Option at any time within two (2) years following the date of his Retirement but, except as otherwise provided in this Agreement, only to the extent that, as of the date of his Retirement, the Optionee's right to exercise such Option had accrued pursuant to the terms of this Agreement and had not previously been exercised. To the extent unexercised, the Option shall expire two (2) years after the date of Retirement or the date of expiration of the term of the Option as set forth in Paragraph 3, whichever shall occur first. (b) Death. If the Human Resources and Compensation Committee (the "Committee") does not determine otherwise with respect to the Option, upon the death of the Optionee, the Option shall be exercisable immediately (by the executor or the administrator of the deceased Optionee's estate or by a person who acquired the right 2 3 to exercise the option by bequest or inheritance or by reason of such death) with respect to only the shares as to which the deceased Optionee had the right to exercise the Option at the time of his death. To the extent unexercised, the Option shall expire (i) one (1) year after the date of such death, or (ii) in the event of death following termination of employment by reason of Retirement as described in Paragraph 6(a) immediately above, the expiration date of the Option after Retirement, whichever occurs last. Notwithstanding the foregoing, the Committee may, in a special case, permit a longer period for exercise of an Option after the death of the Optionee, but in no event shall such period extend beyond the date of expiration of the Option as set forth in this Agreement. (c) Disability. If the Optionee ceases active service as an employee by reason of Disability, he shall have the right to exercise the Option at any time within one (1) year after such cessation of employment, but except as provided in this Agreement, only to the extent that, at the date of such cessation of employment, the Optionee's right to exercise such Option had accrued pursuant to the terms of this Agreement and had not previously been exercised. (d) Termination for Cause. If the Optionee's employment is terminated for "cause" (as hereinafter defined), this Option shall expire immediately upon the giving to him of the notice of such termination. "Cause," for purposes of this Paragraph 6(d), shall mean dishonest or fraudulent conduct which would normally be considered as sufficient basis for discharging an employee from a management and/or a supervisory position, or negligence, inaction or misconduct which constitutes failure by the Optionee to meet such Optionee's obligations and perform such Optionee's duties of employment. (e) Other Reasons. If the Optionee ceases to be an employee for any reason other than those mentioned above in Subparagraphs (a), (b), (c) or (d), the Optionee shall have the right to exercise the Option at any time within thirty (30) days following such cessation, discharge or termination, but, except as otherwise provided in this Agreement, only to the extent that, at the date of cessation, discharge or termination, the Optionee's right to exercise such Option had accrued pursuant to the terms of this Agreement and had not previously been exercised. 7. Exercise of Options upon a Change of Control of the Company. In the event of a Change of Control of the Company, this Option, whether or not vested at such time, shall automatically vest and be immediately exercisable in full, without regard to the years which have elapsed or events which have occurred since the Date of Grant. 3 4 8. Termination of Employment Following Change in Control. If the Optionee's employment terminates following a Change in Control other than for "cause" (as defined in Paragraph 6(d)), the applicable provisions of Paragraph 6 of this Agreement shall apply, except that as of and after the date of the Change in Control, neither the Committee nor the Board shall make any determination or take any action in connection with the Optionee's termination of employment which would cause the Option either (i) to not be exercisable in full or (ii) to expire earlier than the latest date allowable under Paragraph 6 as applicable. 9. Amendment or Termination. (a) Paragraphs 7 and 8 of this Agreement shall not be amended or terminated at any time. (b) Any amendment or termination of this Agreement prior to a Change in Control which (i) was at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control, or (ii) otherwise arose in connection with or in anticipation of a Change in Control, shall be null and void and shall have no effect whatsoever. (c) Except as provided in subparagraphs (a) and (b) above, the Board shall have the authority and right to amend this Agreement at any time upon ten (10) days' prior written notice to Optionee, provided that such amendment does not adversely affect Optionee's rights under this Agreement. 10. Rights of a Shareholder; Non-Transferability. No one shall have rights as a shareholder with respect to any shares covered by this Option until the date of issuance of a stock certificate for such shares. Nothing in this Option confers on Optionee any right to continue in the employ of the Company or to continue to perform services for the Company or interferes in any way with the right of the Company to terminate his services as an officer or other employee at any time. Unless the Committee passes a resolution granting Optionee the right to transfer the Option or a portion of the Option to others, no Option shall be transferable by the Optionee other than by will or the laws of descent and distribution and may only be exercised during his lifetime by the Optionee, or by a guardian or legal representative. 11. Recapitalizations. In the event of any change in the outstanding shares of Common Stock by reason of any stock dividend or split, recapitalization, merger, consolidation, spin-off, reorganization, combination or exchange of shares, or other similar corporate change, or other increase or decrease in such shares without receipt or payment of consideration by the Company, 4 5 the Company will make such adjustments to the Option, to prevent dilution or enlargement of the rights of Optionee, including any or all of the following: (a) adjustments in the aggregate number or kind of shares of Common Stock which may be issued upon exercise of the Option; (b) adjustments in the purchase price of the Common Stock covered by the Options. No such adjustments, however, may change materially the value of benefits available to Optionee under the Option. 12. Taxes; Withholding. In the event the Company determines that it is required to withhold state or federal taxes as a result of the exercise of an Option, as a condition to the exercise thereof, the Optionee must make arrangements satisfactory to the Corporate Secretary to enable the Company to satisfy such withholding requirements. Payment of such withholding requirements may be made (i) in cash, (ii) by delivery of shares registered in the name of Optionee, which shares have a Fair Market Value at the time of exercise equal to the amount to be withheld, (iii) by the Company withholding shares subject to the Option, which shares have a Fair Market Value at the time of exercise equal to the amount to be withheld, or (iv) any combination of (i), (ii) and (iii) above. 13. Securities Law Requirements. (a) Securities Act Requirements. No Option granted pursuant to this Agreement shall be exercisable in whole or in part, and the Company shall not be obligated to sell any shares subject to any such Option, if such exercise and sale would, in the opinion of the Corporate Secretary, violate the Securities Act of 1933 (or other federal or state statutes having similar requirements) as it may be in effect at that time. As a condition to the issuance of any shares upon exercise of an Option under this Agreement, the Corporate Secretary may require the Optionee to furnish a written representation that he is acquiring the shares for investment and not with a view to distribution to the public. Such representations shall be required in cases where, in the opinion of the Corporate Secretary, they are necessary to enable the Company to comply with the provisions of the Securities Act of 1933, and any shareholder who gives such representation shall be released from it at such a time as the shares to which it applies are registered pursuant to the Securities Act of 1933. (b) Listing and Regulatory Requirements. Each Option shall be subject to the further requirements that if at any time the Committee shall determine in its discretion that the listing or qualification of the shares of stock subject to such Option under any securities exchange requirements or under any applicable law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a 5 6 condition of, or in connection with, the granting of such Option or the issue of Shares thereunder, such Option may not be exercised in whole or in part unless and until such listing, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee. 14. Notices. Any notice, payment or communication required or permitted to be given by any provision of this Agreement shall be in writing and shall be delivered personally or sent by certified mail, return receipt requested, addressed as follows: if to the Company at One Technology Parkway South, Norcross, Georgia 30092, Attention: Corporate Secretary, if to Optionee, at the address set forth on the signature page hereto. Each party may, from time to time, by notice to the other party hereto, specify a new address for delivery of notices to such party hereunder. Any such notice shall be deemed to be delivered, given, and received for all purposes as of the date such notice is received or properly mailed. 15. Binding Effect. Except as otherwise provided in this Agreement, every covenant, term, and provision of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, legatees, legal representatives, successors, transferees, and assigns. 16. Headings. Section and other headings contained in this Agreement are for reference purposes only and are not intended to describe, interpret, define or limit the scope, event or intent of this Agreement or any provision hereof. 17. Severability. Every provision of this Agreement is intended to be severable. If any term or provision hereof is illegal or invalid for any reason whatsoever, such illegality or invalidity shall not affect the validity or legality of the remainder of this Agreement. 18. Governing Law. The laws of the state of Georgia shall govern the validity of this Agreement, the construction of its terms, and the interpretation of the rights and duties of the parties hereto. 6 7 IN WITNESS WHEREOF, this Agreement is executed as of the 14th day of November, 1996. COMPANY: SCIENTIFIC-ATLANTA, INC. By: /s/ Brian C. Koenig -------------------------------------- Its: Senior Vice President, Human Resources OPTIONEE: /s/ James F. McDonald ------------------------------------------- James F. McDonald OPTIONEE'S ADDRESS: 2870 Pharr Court South, N.W. #3101 Atlanta, Georgia 30305 OPTIONEE'S SSN: ###-##-#### 7 8 SCHEDULE 1 TO NON-QUALIFIED STOCK OPTION AGREEMENT "BOARD" means the Board of Directors of the Company. "CHANGE IN CONTROL" means any of the following events: (a) The acquisition in one or more transactions by any "Person" (as the term person is used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as amended (the "1934 Act")), of "Beneficial Ownership" (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of twenty percent (20%) or more of the combined voting power of the Company's then outstanding voting securities (the "Voting Securities"), provided, however, that for purposes of this Agreement, the Voting Securities acquired directly from the Company by any Person shall be excluded from the determination of such Person's Beneficial Ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding); or (b) The individuals who are members of the Incumbent Board (as hereinafter defined), cease for any reason to constitute at least two-thirds of the Board for purposes of this Agreement. The "Incumbent Board" shall include the individuals who as of August 20, 1990 are members of the Board and any individual becoming a director subsequent to August 20, 1990 whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board; provided, however, that any individual who is not a member of the Incumbent Board at the time he or she becomes a member of the Board shall become a member of the Incumbent Board upon the completion of two full years as a member of the Board; provided, further, however, that notwithstanding the foregoing, no individual shall be considered a member of the Incumbent Board if such individual initially assumed office (i) as a result of either an actual or threatened "election contest" (within the meaning of Rule 14a-11 promulgated under the 1934 Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board (a "Proxy Contest"), or (ii) with the approval of the other Board members, but by reason of any agreement intended to avoid or settle a Proxy Contest; or (c) Approval by stockholders of the Company of (i) a merger or consolidation involving the Company if the stockholders of the Company immediately before such merger or consolidation do not own, directly or indirectly, immediately following such merger or consolidation, more than eighty percent (80%) of the combined voting 9 power of the outstanding voting securities of the Company resulting from such merger or consolidation in substantially the same proportion as their ownership of the Voting Securities immediately before such merger or consolidation, or (ii) a complete liquidation or dissolution of the Company or an agreement for the sale or other disposition of all or substantially all of the assets of the Company. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because twenty percent (20%) or more of the then outstanding Voting Securities is acquired by (i) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained by the Company or any of its subsidiaries, or (ii) any corporation which, immediately prior to such acquisition, is owned directly or indirectly by the stockholders of the Company in the same proportion as their ownership of stock in the Company immediately prior to such acquisition. Moreover, notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any Person (the "Subject Person") acquired Beneficial Ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company which, by reducing the number of Voting Securities outstanding, increases the proportional number of shares Beneficially Owned by the Subject Person, provided, that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Voting Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the Beneficial Owner of any additional Voting Securities which increases the percentage of the then outstanding Voting Securities Beneficially Owned by the Subject Person, then a Change in Control shall occur. Notwithstanding anything contained in this Agreement to the contrary, if a Change in Control takes place and the Optionee's employment is terminated prior to the completed Change in Control and the Optionee reasonably demonstrates that such termination (i) was at the request of a third party who has indicated an intention or taken steps reasonably calculated to effect a Change in Control and who effectuates a Change in Control or (ii) otherwise occurred in connection with or in anticipation of a Change in Control which actually occurs, then for all purposes of this Agreement, the date of a Change in Control in respect of such Optionee shall mean the date immediately prior to the date of termination of such Optionee's employment. "CODE" means the Internal Revenue Code of 1986, as amended. 10 "DISABILITY" means the condition of an individual who is unable to engage in any substantial gainful activity by reason of any physical or mental impairment which is classified as a disability in the Company's Long Term Disability Plan. "FAIR MARKET VALUE" means the value of one (1) share of Common Stock, and shall be equal to the closing sale price as reported on the New York Stock Exchange on the date of valuation or, if no sale occurred on that date, then the mean between the closing bid and asked prices on such exchange on such date. If the date of valuation is not a business day, the price on the last business day preceding the date of valuation shall be utilized. "RETIREMENT" shall mean the Optionee's voluntary termination of his employment with the Company after he has either (i) attained age sixty (60) or (ii) attained age fifty-five (55) and attained the tenth (10th) anniversary of his seniority date. EX-5 3 LEGALITY OPTION 1 EXHIBIT 5 December 26, 1996 17528.49938 Scientific-Atlanta, Inc. One Technology Parkway, South Norcross, Georgia 30092 Re: Scientific-Atlanta, Inc. Non-Qualified Stock Option Agreement with Employee Registration Statement on Form S-8 Ladies and Gentlemen: As counsel for Scientific-Atlanta, Inc., a Georgia corporation (the "Company"), you have requested our opinion in connection with the preparation and filing with the Securities and Exchange Commission of a Registration Statement on Form S-8 (the "Registration Statement") registering 100,000 shares of the Company's common stock, $0.50 par value per share, for issuance upon the exercise of options represented by that certain Non-Qualified Stock Option Agreement dated November 13, 1996, by and between the Company and James F. McDonald (the "Option Agreement"). We have examined such records and documents and made such examination of law as we have deemed relevant in connection with this opinion. Based on the foregoing, we are of the opinion that the 100,000 shares covered by said Registration Statement, when issued in accordance with the terms of the Option Agreement, will be legally issued, fully-paid and nonassessable. We hereby consent to the filing of this opinion as an exhibit to the above- referenced Registration Statement on Form S-8 of Scientific-Atlanta, Inc. Respectfully submitted, Paul, Hastings, Janofsky & Walker LLP EX-23.1 4 CONSENT OF AUTHUR ANDERSEN LLP 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in Scientific-Atlanta, Inc.'s Form S-8 Registration Statement of our report dated August 5, 1996 (except with respect to the matter discussed in Note 6, as to which the date is August 14, 1996), appearing on page 13 of Scientific-Atlanta, Inc's Form 10-K for the year ended June 28, 1996. /s/ Arthur Andersen LLP Atlanta, Georgia December 26, 1996 -----END PRIVACY-ENHANCED MESSAGE-----