Registration
No. 333-
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-8
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
THE
CHILDREN'S PLACE RETAIL STORES, INC.
(Exact
name of registrant as specified in its Charter)
|
Delaware
|
31-1241495
|
|
(State
or Other Jurisdiction
|
(I.R.S.
Employer
|
|
of
Incorporation or Organization)
|
Identification
No.)
|
The
Children's Place Retail Stores, Inc.
915
Secaucus Road
Secaucus,
New Jersey 07094
(201)
558-2400
(Address
of principal executive offices)(Zip code)
Amended
and Restated 2005 Equity Incentive Plan of The Children’s Place Retail Stores,
Inc.
(Full
title of the Plan)
Steven
Balasiano, Esq.
Senior
Vice President and General Counsel
The
Children's Place Retail Stores, Inc.
915
Secaucus Road
Secaucus,
New Jersey 07094
(201)
558-2400
(Name
and
Address of Agent for Service)
Copy
To:
Jeffrey
S. Lowenthal, Esq.
Stroock
& Stroock & Lavan LLP
180
Maiden Lane
New
York, New York 10038
(212)
806-5400
CALCULATION
OF REGISTRATION FEE
|
Title
of Securities
to
be Registered
|
Amount
to be
Registered
(1)
|
Proposed
Maximum
Offering
Price
Per Share (2)
|
Proposed
Maximum
Aggregate
Offering
Price (2)
|
Amount
of
Registration
Fee
|
|
Common
Stock,
|
|
|||
|
$.10
par value
|
1,896,400
shares (3)
|
$59.76
|
$113,328,864
|
--
|
|
Common
Stock,
|
||||
|
$.10
par value
|
103,600
shares (4)
|
$45.99
|
$4,764,564
|
--
|
|
TOTAL
|
2,000,000
shares
|
--
|
$118,093,428
|
$12,636
|
|
(1)
|
Pursuant
to Rule 416(a) under the Securities Act of 1933, this Registration
Statement also covers an indeterminate number of additional shares
of
Common Stock which may become issuable by reason of the adjustment
provisions of the Amended and Restated 2005 Equity Incentive Plan
of The
Children’s Place Retail Stores,
Inc.
|
|
(2)
|
For
purposes of calculating the registration fee, (i) the offering prices
of
stock options or performance awards under the Amended and Restated
2005
Equity Incentive Plan of The Children’s Place Retail Stores, Inc. (other
than stock options that have been granted under such plan as of the
date
of this Registration Statement) have been determined in accordance
with
Rule 457(c) based upon the $59.76 average of the high and low sale
prices
for a share of Common Stock of the Registrant as reported on the
Nasdaq
National Market on June 15, 2006, and (ii) the offering prices of
stock
options that have been granted under such plan as of the date of
this
Registration Statement have been determined in accordance with Rule
457(h)
based upon the $45.99 weighted average exercise price (rounded to
the
nearest cent) of all such options. Offering prices are estimated
solely
for the purpose of calculating the registration
fee.
|
|
(3)
|
Consists
of shares which are issuable under the Amended and Restated 2005
Equity
Incentive Plan of The Children’s Place Retail Stores, Inc., other than
shares issuable upon the exercise of outstanding stock options granted
under such plan as of the date of this Registration
Statement.
|
|
(4)
|
Consists
of shares which are issuable under the Amended and Restated 2005
Equity
Incentive Plan of The Children’s Place Retail Stores, Inc. upon the
exercise of outstanding stock options granted under such plan as
of the
date of this Registration
Statement.
|
INTRODUCTORY
STATEMENT
The
Children’s Place Retail Stores, Inc., a Delaware corporation (the “Registrant”
or the “Company”) is filing this Registration Statement on Form S-8 (the
“Registration Statement”) under the Securities Act of 1933, as amended (the
“Securities Act”), with Exchange Commission (the “Commission”) to register
2,000,000 shares of common stock, $0.10 par value per share, of the Company
(the
“Common Stock”) that may be issued under the Amended and Restated 2005 Equity
the Securities and Incentive Plan of The Children’s Place Retail Stores, Inc.
(the “Plan”) (plus any additional shares of Common Stock that may be issued
pursuant to the adjustment provisions of the Plan).
PART
I
INFORMATION
REQUIRED IN THE SECTION 10(a) PROSPECTUS
The
documents containing the information specified in Part I of this registration
statement on Form S-8 will be sent or given to each participant in the Plan
as
specified by Rule 428(b)(1) under the Securities Act. Such documents are not
being filed with or included in this registration statement (by incorporation
by
reference or otherwise) in accordance with the rules and regulations of the
Commission. Such documents and the documents incorporated by reference into
this
registration statement pursuant to Item 3 of Part II of this registration
statement, taken together, constitute a prospectus that meets the requirements
of Section 10(a) of the Securities Act.
Item
1. Plan Information.
Not
filed as part of this registration statement pursuant to Note to Part 1 of
Form
S-8.
Item
2. Registrant Information and Employee Plan Annual
Information.
Not
filed as part of this registration statement pursuant to Note to Part 1of Form
S-8.
PART
II
INFORMATION
REQUIRED IN THE REGISTRATION STATEMENT
Item
3. Incorporation of Documents by Reference.
The
following documents heretofore filed by the Company with the Commission are
incorporated herein by reference:
(a) The
Company’s Annual Report on Form 10-K for the fiscal year ended January 28,
2006;
(b) The
Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended April 29,
2006;
(c) The
Company’s Current Reports on Form 8-K filed February 1, 2006, February 2, 2006,
March 2, 2006, March 8, 2006, March 9, 2006, April 6, 2006, April 20, 2006,
May
4, 2006, May 9, 2006, May 18, 2006 and May 19, 2006; and
(d) Item
1 of
the Company’s Registration Statement on Form 8-A, filed September 18, 1997 to
register the Company’s Common Stock pursuant to Section 12(g) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”).
All
documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d)
of
the Exchange Act after the date of this Registration Statement and prior to
the
filing of a post-effective amendment to this Registration Statement 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 in this Registration Statement and to be part hereof from the date
of
filing of such documents.
Any
statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
Item
4. Description of Securities.
Not
applicable.
Item
5. Interests of Named Experts and Counsel.
Not
applicable.
Item
6. Indemnification of Directors and Officers.
The
Company's Certificate of Incorporation limits the liability of directors (in
their capacity as directors but not in their capacity as officers) to the
Company or its stockholders to the fullest extent permitted by the Delaware
General Corporation Law (“DGCL”). Specifically, no director of the Company will
be personally liable for monetary damages for breach of the director's fiduciary
duty as a director, except for liability: (i) for any breach of the director's
duty of loyalty to the Company or its stockholders; (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation
of law; (iii) under Section 174 of the DGCL, which relates to unlawful payments
of dividends or unlawful stock repurchases or redemptions, or any successor
provision thereto; or (iv) for any transaction from which the director derived
an improper personal benefit. The inclusion of this provision in the Certificate
of Incorporation may have the effect of reducing the likelihood of derivative
litigation against directors, and may discourage or deter stockholders or
management from bringing a lawsuit against directors for breach of their duty
of
care, even though such an action, if successful, might otherwise have benefited
the Company and its stockholders.
Under
the
Certificate of Incorporation, the Company will indemnify those persons whom
it
shall have the power to indemnify to the fullest extent permitted by Section
145
of the DGCL, which may include liabilities under the Securities Act of 1933.
Accordingly, in accordance with Section 145 of the DGCL, the Company will
indemnify any person who was or is a party, or is threatened to be made a party,
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than a “derivative”
action by or in the right of the Company) by reason of the fact that such person
is or was a director, officer, employee or agent of the Company, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement in connection with such action, suit or proceeding if such person
acted in good faith and in a manner such person reasonably believed to be in
or
not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe was unlawful.
A similar standard of care is applicable in the case of derivative actions,
except that indemnification only extends to expenses (including attorneys'
fees)
incurred in connection with the defense or settlement of such an action and
then, where the person is adjudged to be liable to the Company, only if and
to
the extent that the Court of Chancery of the State of Delaware or the court
in
which such action was brought determines that such person is fairly and
reasonably entitled to such indemnity and then only for such expenses as the
court deems proper.
The
Certificate of Incorporation provides that the Company will advance expenses
to
the fullest extent permitted by Section 145 of the DGCL. Accordingly, the
Company, in accordance therewith, will pay for the expenses incurred by an
indemnified person in defending the proceedings specified in the preceding
paragraph in advance of their final disposition, provided that, if the DGCL
so
requires, such person agrees to reimburse the Company if it is ultimately
determined that such person is not entitled to indemnification. In addition,
pursuant to the DGCL the Company may purchase and maintain insurance on behalf
of any person who is or was a director, employee or agent of the Company against
any liability asserted against and incurred by such person in such capacity,
or
arising out of the person's status as such whether or not the Company would
have
the power or obligation to indemnify such person against such liability under
the provisions of DGCL. The Company has obtained insurance for the benefit
of
the Company's officers and directors insuring such persons against certain
liabilities, including liabilities under the securities laws.
The
Company has entered into agreements to indemnify its directors which are
intended to provide the maximum indemnification permitted by Delaware law.
These
agreements, among other things, indemnify each of the Company's outside
directors for certain expenses (including attorneys' fees), judgments, fines
and
settlement amounts incurred by such director in any action or proceeding,
including any action by or in the right of the Company, on account of such
director's service as a director of the Company.
Item
7. Exemption From Registration Claimed.
Not
applicable.
Item
8. Exhibits.
Exhibit
Number
| 4* |
-
Amended
and Restated 2005
Equity Incentive Plan of The Children’s Place Retail Stores,
Inc.
|
| 5* |
-
Opinion
of Stroock & Stroock & Lavan LLP, as to the legality of the
securities being registered.
|
| 23.1* |
-
Consent
of Stroock & Stroock & Lavan LLP (Included in Exhibit
5.1).
|
| 23.2* |
-
Consent
of Independent Public Accountants.
|
| 24* |
-
Powers
of Attorney (included on signature
pages).
|
__________
*
Filed
herewith
Item
9. Undertakings.
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;
(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 (1)(i) and (1)(ii) do not apply if 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 Securities and Exchange
Commission by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this Registration
Statement.
(2)
That,
for
the purpose of determining any liability under the Securities Act, 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.
(4)
That,
for
the purpose of determining liability of the registrant under the Securities
Act
to any purchaser in the initial distribution of the securities, the undersigned
registrant undertakes that in a primary offering of securities of the
undersigned registrant pursuant to this registration statement, regardless
of
the underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned registrant will be a seller to the
purchaser and will be considered to offer or sell such securities to such
purchaser:
(i)
Any
preliminary prospectus or prospectus of the undersigned registrant relating
to
the offering required to be filed pursuant to Rule 424;
(ii)
Any
free
writing prospectus relating to the offering prepared by or on behalf of the
undersigned registrant or used or referred to by the undersigned
registrant;
(iii)
The
portion of any other free writing prospectus relating to the offering containing
material information about the undersigned registrant or its securities provided
by or on behalf of the undersigned registrant; and
(iv)
Any
other
communication that is an offer in the offering made by the undersigned
registrant to the purchaser.
The
undersigned Registrant hereby undertakes that, for purposes of determining
any
liability under the Securities Act, each filing of the Registrant’s annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan’s annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona
fide
offering
thereof.
Insofar
as indemnification for liabilities arising under the Securities Act 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 Securities 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 Securities Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant
to the requirements of the Securities Act, the Registrant certifies that it
has
reasonable grounds to believe that it meets all of the requirements for filing
this 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
Secaucus, State of New Jersey on the 21st
day of
June 2006.
| THE CHILDREN'S PLACE RETAIL STORES, INC. | ||
| |
|
|
| By: | /s/ Steven Balasiano | |
|
Name: Steven Balasiano |
||
|
Title:
Senior
Vice President, Chief Administrative
Officer
and General Counsel
|
||
POWER
OF ATTORNEY
KNOW
ALL
MEN BY THESE PRESENTS, that each individual whose signature appears below
constitutes and appoints Ezra Dabah, Steven Balasiano and Susan Riley 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 capabilities, to sign any and all amendments (including
post-effective amendments) of and supplements 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 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 as to all intents and purposes as they might
or
could do in person, hereby ratifying and confirming all that all such
attorneys-in-fact and agents or any of them, or their or his substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, as amended, this registration
statement has been signed by the following persons in the capacities and on
the
date indicated.
|
Signatures
|
Title
|
Date
|
||
|
/s/
Ezra Dabah
Ezra
Dabah
|
Chief
Executive Officer and Chairman of the Board of Directors (Principal
Executive Officer)
|
June
21, 2006
|
||
|
/s/
Susan Riley
Susan
Riley
|
Senior
Vice President and Chief Financial Officer (Principal Financial and
Accounting Officer)
|
June
21, 2006
|
||
|
/s/
Charles Crovitz
Charles
Crovitz
|
Director
|
June
21, 2006
|
||
|
/s/
Malcolm Elvey
Malcolm
Elvey
|
Director
|
June
21, 2006
|
||
|
/s/
Robert Fisch
Robert
Fisch
|
Director
|
June
21, 2006
|
||
|
/s/
Sally Frame Kasaks
Sally
Frame Kasaks
|
Director
|
June
21, 2006
|
||
|
/s/
Stanley Silverstein
Stanley
Silverstein
|
Director
|
June
21, 2006
|
EXHIBIT
INDEX
|
Exhibit
|
Page
|
|
|
Number
|
Description
|
Number
|
|
4*
|
Amended
and Restated 2005 Equity Incentive Plan of The Children’s Place Retail
Stores, Inc.
|
|
|
5*
|
Opinion
of Stroock & Stroock & Lavan LLP as to the legality of the securities
being offered.
|
|
|
23.1*
|
Consent
of Stroock & Stroock & Lavan LLP. (Included in Exhibit
5.1).
|
|
|
23.2*
|
Consent
of Deloitte & Touche LLP.
|
|
|
24*
|
Powers
of Attorney (included on signature pages).
|
__________
*
Filed
herewith
AMENDED
AND RESTATED
2005
EQUITY INCENTIVE PLAN
OF
THE
CHILDREN’S PLACE RETAIL STORES, INC.
1. Purpose.
The
purpose of this Equity Incentive Plan is to advance the interests of the
Corporation by encouraging and enabling the acquisition of a larger personal
proprietary interest in the Corporation by key employees and directors of the
Corporation and its Subsidiaries upon whose judgment and keen interest the
Corporation is largely dependent for the successful conduct of its operations
and by providing such key employees and directors with incentives to put forth
maximum efforts for the success of the Corporation’s business. It is anticipated
that the acquisition of such proprietary interests in the Corporation and such
incentives will stimulate the efforts of such key employees and directors on
behalf of the Corporation and its Subsidiaries and strengthen their desire
to
remain with the Corporation and its Subsidiaries. It is also expected that
such
incentives and the opportunity to acquire such a proprietary interest will
enable the Corporation and its Subsidiaries to attract desirable employees
and
directors.
2. Definitions.
When
used in this Plan, unless the context otherwise requires:
(a) “Alternative
Rights” shall have the meaning as set forth in Section 9 hereof.
(b) “Board
of
Directors” shall mean the Board of Directors of the Corporation, as constituted
at any time.
(c) Except
as
otherwise provided in the holder’s employment agreement (if any) with the
Corporation or a Subsidiary, “Cause” shall mean, with respect to the holder of
an Incentive Award, (i) a breach by the holder of any of the material provisions
of any employment agreement between the holder and the Corporation or a
Subsidiary that the holder fails to remedy or cease within ten (10) days after
notice thereof to the holder; (ii) any conduct, action or behavior by the holder
that has or may reasonably be expected to have a material adverse effect on
the
reputation of the Corporation or its Subsidiaries or on the holder’s reputation
or that is not befitting of an executive officer, employee or director of the
Corporation or a Subsidiary; (iii) the commission by the holder of an act
involving moral turpitude or dishonesty, whether or not in connection with
the
holder’s employment by, or service as a director of, the Corporation or a
Subsidiary; (iv) the holder shall have committed any act of fraud or
embezzlement against the Corporation or a Subsidiary or engaged in any other
willful misconduct in connection with his duties; or (v) the holder shall have
been convicted of a felony (other than a felony relating to motor vehicle laws).
Notwithstanding the foregoing, no Cause shall be deemed to exist with respect
to
the holder’s acts described in (ii) above unless the Corporation shall have
given prior written notice to the holder specifying the Cause with reasonable
particularity and, within 30 days after such notice, the holder shall not have
cured or eliminated the problem or thing giving rise to such Cause.
(d) “Chairman
of the Board” shall mean the person who at the time shall be Chairman of the
Board of Directors.
(e) “Change
in Control” shall mean any of the following events: (i) the sale to any
purchaser of (A) all or substantially all of the assets of the Corporation
or
(B) capital stock representing more than 50% of the stock of the
Corporation entitled to vote generally in the election of directors of the
Corporation; (ii) the merger or consolidation of the Corporation with another
corporation if, immediately after such merger or consolidation, less than a
majority of the combined voting power of the then outstanding securities
entitled to vote generally in the election of directors of the surviving or
resulting corporation in such merger or consolidation is held, directly or
indirectly, in the aggregate by the holders immediately prior to such
transaction of the outstanding securities of the Corporation; (iii) the filing
of a report on Schedule 13D or Schedule 14D-1 (or any successor schedule, form,
or report or item therein), each promulgated pursuant to the Exchange Act,
disclosing that any person (as the term “person” is used in Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act) has become the beneficial owner (as the
term “beneficial owner” is defined under Rule 13d-3 or any successor rule or
regulation promulgated under the Exchange Act) of securities representing 50%
or
more of the combined voting power of the voting stock of the Corporation; or
(iv) the filing by the Corporation of a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange Act disclosing
in
response to Form 8-K or Schedule 14A (or any successor schedule, form, or report
or item therein) that a change in control of the Corporation has occurred or
will occur in the future pursuant to any then existing contract or transaction.
Notwithstanding the foregoing, a “Change in Control” shall not be deemed to
occur as a result of an event described above if a majority of the individuals
who are members of the Board of Directors prior to such event specifically
determines that a Change in Control should not be deemed to have
occurred.
(f) “Code”
shall mean the Internal Revenue Code of 1986, as amended.
(g) “Committee”
shall mean the Committee hereinafter described in Section 3 hereof.
(h) “Corporation”
shall mean The Children’s Place Retail Stores, Inc., a Delaware
corporation.
(i) “Deferred
Stock Award” shall mean an Incentive Award granted in accordance with Section 15
hereof.
(j) “Disability”
shall mean: (i) with respect to the holder of an Option that is not an incentive
stock option, the holder’s inability, as a result of physical or mental
incapacity or infirmity, to perform the duties of his employment for (a) a
continuous period of at least 120 days, or (b) periods aggregating at least
180
days during any period of 12 consecutive months; or (ii) with respect to the
holder of an Option that is an incentive stock option, and when used in
connection with such incentive stock option following such holder’s termination
of employment, a “disability” within the meaning of Section 22(e)(3) of the
Code.
2
(k) “Eligible
Director” shall mean a director of the Corporation who is not also an employee
of the Corporation or a Subsidiary.
(l) “Eligible
Persons” shall mean those persons described in Section 4 who are potential
recipients of Incentive Awards.
(m) “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.
(n) “Fair
Market Value” on a specified date shall mean the average of the highest and
lowest selling price at which a Share is traded on the stock exchange, if any,
on which Shares are primarily traded or, if the Shares are not then traded
on a
stock exchange, the average of the closing representative bid and asked price
of
a Share as reported by the principal securities exchange or securities trading
market on which the Shares are listed or approved for trading, but if no Shares
were traded on such date, then on the last previous date on which a Share was
so
traded, or, if none of the above are applicable, the value of a Share as
established by the Board of Directors or the Committee for such date using
any
reasonable method of valuation.
(o) “Incentive
Award” shall mean an Option, Right, Restricted Stock Award, Deferred Stock Award
or Performance Award granted pursuant to this Plan.
(p) “Options”
shall mean the stock options granted pursuant to this Plan.
(q) “Performance
Award” shall mean an Incentive Award granted in accordance with Section 16
hereof.
(r) “Plan”
shall mean this 2005 Equity Incentive Plan of The Children’s Place Retail
Stores, Inc., as adopted by the Board of Directors on April 18, 2005, as amended
and restated on June 23, 2005, as such Plan from time to time may be further
amended.
(s) “President”
shall mean the person who at the time shall be the President of the
Corporation.
(t) “Restricted
Shares” shall mean the Shares issued as a result of a Restricted Stock
Award.
(u) “Restricted
Stock Award” shall mean a grant of Restricted Shares or of the right to purchase
Restricted Shares pursuant to Section 13 hereof.
(v) “Rights”
shall mean Alternative Rights and/or Stock Appreciation Rights granted pursuant
to the Plan.
(w) “Share”
shall mean a share of common stock, par value $.10 per share, of the
Corporation.
(x) “Spread”
shall mean the excess of the Fair Market Value of a Share on the date of
exercise of a Right over the exercise price per Share of such
Right.
3
(y) “Stock
Appreciation Rights” shall have the meaning as set forth in Section 9
hereof.
(z) “Subsidiary”
shall mean any corporation, limited liability corporation, partnership or
limited partnership, 50% or more of whose stock having general voting power,
membership interests, or capital or profits interests, as the case may be,
is
owned by the Corporation, or by another Subsidiary as herein defined, of the
Corporation; provided, however, that for purposes of an Option that is an
incentive stock option to be granted to an employee of a Subsidiary, the term
“Subsidiary” shall mean a subsidiary corporation as defined in Section 424(f) of
the Code.
3. Administration.
The
Plan shall be administered by the Compensation Committee of the Board of
Directors (the “Committee”), which shall consist of two or more directors of the
Corporation, each of whom shall be a “Non-Employee Director” within the meaning
of Rule 16b-3 under the Exchange Act and an “outside director” within the
meaning of Section 162(m) of the Code. Any member of the Committee may resign
by
giving written notice thereof to the Board of Directors, and any member of
the
Committee may be removed at any time, with or without Cause, by the Board of
Directors. If, for any reason, a member of the Committee shall cease to serve,
the vacancy shall be filled by the Board of Directors.
The
Committee shall have full power and authority to administer and interpret the
Plan. Determinations of the Committee as to any question which may arise with
respect to the interpretation of the provisions of the Plan and Incentive Awards
shall be final. The Committee may authorize and establish such rules,
regulations and revisions thereof not inconsistent with the provisions of the
Plan, as it may deem advisable to make the Plan and Incentive Awards effective
or provide for their administration, and may take such other action with regard
to the Plan and Incentive Awards as it shall deem desirable to effectuate their
purpose.
4. Participants.
The
class of persons who are potential recipients of Incentive Awards granted under
this Plan shall consist of key employees and directors of the Corporation or
a
Subsidiary, as determined by the Committee in its sole discretion. The parties
to whom Incentive Awards are granted under this Plan, and the number of Shares
subject to each such Incentive Award, shall be determined by the Committee
in
its sole discretion, subject, however, to the terms and conditions of this
Plan.
Each Eligible Director shall only be eligible to receive Options in accordance
with Section 7 hereof.
5. Shares.
Subject
to the provisions of Section 20 hereof, the Committee may grant Incentive Awards
with respect to an aggregate of up to 2 million Shares, all of which Shares
may
be either Shares held in treasury or authorized but unissued Shares, provided,
however, that the foregoing limitation shall not apply to Alternative Rights
but
shall apply to any Option with respect to which the Alternative Rights are
granted. The maximum number of Shares which may be the subject of Options and
Rights granted during any calendar year to any individual shall not exceed
500,000 Shares. If the Shares that would be issued or transferred pursuant
to
any Incentive Awards are not issued or transferred and cease to be issuable
or
transferable for any reason, or if Restricted Shares which are subject to a
Restricted Stock Award are forfeited, the number of Shares subject to such
Incentive Award will no longer be charged against the limitation provided for
herein and may again be made subject to Incentive Awards; provided, however,
that Shares as to which an Option has been surrendered in connection with the
exercise of an Alternative Right shall not again be available for the grant
of
any further Incentive Awards. If any portion of a Stock Appreciation Right
expires or is forfeited for any reason prior to being exercised, the number
of
Shares subject to the unexercised portion of such Stock Appreciation Right
will
no longer be charged against the limitation provided for herein and may again
be
made subject to Incentive Awards. Notwithstanding the preceding, with respect
to
any Option and/or Rights granted to any individual who is a “covered employee”
within the meaning of Section 162(m) of the Code that is canceled, the number
of
shares subject to such Option and/or Rights shall continue to count against
the
maximum number of shares which may be the subject of Options and Rights granted
to such individual during the applicable calendar year. For purposes of the
preceding sentence, if, after grant, the exercise price of an Option and/or
the
base amount of any Rights is reduced, such reduction shall be treated as a
cancellation of such Option and/or Rights and the grant of a new Option and/or
Rights (if any), and both the cancellation of the Option and/or Rights and
the
new Option and/or Rights shall reduce the maximum number of Shares for which
Options and Rights may be granted to the holder of such Option and/or Rights
during the applicable calendar year. In the event Shares are withheld by the
Corporation to satisfy income or other tax withholding obligations with respect
to any Incentive Award, the Shares withheld for this purpose shall reduce the
maximum number of Shares for which Options and/or Rights may be granted to
the
holder of such Option and/or Rights and shall be charged against the limitations
in this Section 5.
4
6. Grant
of Options.
The
number of Options to be granted to any Eligible Person shall be determined
by
the Committee in its sole discretion.
At
the
time an Option is granted, the Committee may, in its sole discretion, designate
whether such Option (a) is to be considered as an incentive stock option within
the meaning of Section 422 of the Code, or (b) is not to be treated as an
incentive stock option for purposes of this Plan and the Code. Options with
respect to which no designation is made by the Committee shall be deemed to
be
incentive stock options to the extent that the $100,000 limitation described
in
the succeeding paragraph is satisfied. No Option which is intended to qualify
as
an incentive stock option shall be granted under this Plan to any person who,
at
the time of such grant, is not an employee of the Corporation or a
Subsidiary.
Notwithstanding
any other provision of this Plan to the contrary, to the extent that the
aggregate Fair Market Value (determined as of the date an Option is granted)
of
the Shares with respect to which Options which are designated as incentive
stock
options, and any other incentive stock options, granted to an employee (under
this Plan, or any other incentive stock option plan maintained by the
Corporation or any Subsidiary that meets the requirements of Section 422 of
the
Code) first become exercisable in any calendar year exceeds $100,000, such
Options shall be treated as Options which are not incentive stock options.
This
paragraph shall be applied by taking Options into account in the order in which
they are granted.
Nothing
herein contained shall be construed to prohibit the issuance of Options at
different times to the same person.
An
Option
agreement signed by the Chairman of the Board or the President or a Vice
President of the Corporation, attested by the Treasurer or an Assistant
Treasurer, or Secretary or an Assistant Secretary of the Corporation and bearing
the seal of the Corporation affixed thereto, shall be issued to each person
to
whom an Option is granted. The Option agreement shall be in the form as may
be
determined by the Committee from time to time, and need not be identical with
respect to each grantee.
5
7. Grants
of Options to Eligible Directors.
Notwithstanding any other provision of this Plan to the contrary, Options which
are not incentive stock options shall be granted to each Eligible Director
in
accordance with this Section 7. Each Eligible Director who is initially elected
to the Board of Directors by the Corporation shall be granted an Option on
the
date of his initial election to the Board of Directors to purchase 15,000 Shares
at a purchase price per Share equal to the Fair Market Value of a Share on
the
date of grant of such Option. On the last day of each fiscal year of the
Corporation, each member of the Board of Directors who is an Eligible Director
on such date shall be granted an additional Option to purchase 6,000 Shares
at a
purchase price per Share equal to the Fair Market Value of a Share on the date
of grant of such Option; provided, however, that with respect to any such
Eligible Director who is initially elected to the Board of Directors during
such
a fiscal year, the Option granted to such Eligible Director on the last day
of
the fiscal year during which he was initially elected to the Board of Directors
shall be for a number of Shares equal to 6,000 multiplied by a fraction, the
numerator of which shall be the number of days during the fiscal year during
which such Eligible Director was a member of the Board of Directors and the
denominator of which shall be 365, which number of Shares shall be rounded
up to
the next whole number of Shares.
8. Option
Purchase Price.
The
price per Share of the Shares to be purchased pursuant to the exercise of any
Option shall be fixed by the Committee at the time of grant; provided, however,
that in no event shall such purchase price be less than 100% of the Fair Market
Value of a Share on the date of grant of the Option.
9. Grant
of Rights.
The
Committee, in its sole discretion, shall have the authority to grant Rights
to
any Eligible Person, which may be granted separately, or in connection with
an
Option at the time of the grant of an Option. Any Rights granted in connection
with an Option (“Alternative Rights”) shall be granted with respect to the same
number of Shares as are covered by the Option, subject to adjustment pursuant
to
the provisions of Section 20 hereof, and may be exercised as an alternative
to the exercise of the related Option.
Alternative
Rights granted in connection with an Option shall entitle the holder thereof
to
receive Shares from the Corporation, determined as hereinafter provided, only
if
and to the extent that the related Option is exercisable, by surrendering the
Option with respect to the number of Shares as to which such Rights are then
exercised. Such Option, to the extent surrendered, shall be deemed exercised
for
purposes of the limitations under Section 5. Upon any exercise of Alternative
Rights, the holder thereof shall be entitled to receive a number of Shares
(rounded down to the next whole number of Shares) equal to (i) the product
obtained by multiplying (A) the Spread by (B) the number of Shares in respect
of
which the Rights shall have then been so exercised, divided by (ii) the Fair
Market Value of a Share on the date of exercise.
Upon
the
exercise of Rights granted without relationship to an Option (“Stock
Appreciation Rights”), the holder thereof shall be entitled to receive a number
of Shares (rounded down to the next whole number of Shares) equal to (i) the
product obtained by multiplying (A) the Spread by (B) the number of Shares
in
respect of which the Stock Appreciation Rights shall have then been so
exercised, divided by (ii) the Fair Market Value of a Share on the date of
exercise.
6
Notwithstanding
anything contained herein, the Committee, in its sole discretion, may limit
the
amount payable upon the exercise of Rights. Any such limitation shall be
determined as of the date of grant and noted in the Rights agreement evidencing
the grant of the Rights.
Rights
shall be evidenced by an agreement executed on behalf of the Corporation and
by
the Eligible Person to whom the Rights are granted. Each Rights agreement shall
set forth the number of Shares subject to the Rights being granted, the exercise
price per Share thereof, and such other terms and conditions as determined
by
the Committee at the time of grant; provided, however, that (i) the exercise
price per Share of Alternative Rights shall be equal to the purchase price
per
Share of the Option related thereto, and (ii) in no event shall the exercise
price per Share of any Rights be less than 100% of the Fair Market Value of
a
Share on the date of grant of such Rights. The form of agreement shall be as
determined from time to time by the Committee, and need not be identical with
respect to each grantee.
10. Duration
of Options and Rights.
The
duration of any Option or Right granted under this Plan shall be fixed by the
Committee at the time of grant; provided, however, that no Option or Right
shall
remain in effect for a period of more than ten (10) years from the date upon
which it is granted.
The
duration of any Alternative Rights granted in connection with any Option shall
be coterminous with the duration of the related Option.
11. Ten
Percent Shareholders.
Notwithstanding any other provision of this Plan to the contrary, no Option
which is intended to qualify as an incentive stock option may be granted under
this Plan to any employee who, at the time the Option is granted, owns shares
possessing more than ten percent (10%) of the total combined voting power of
all
classes of stock of the Corporation, unless the exercise price under such Option
is at least 110% of the Fair Market Value of a Share on the date such Option
is
granted and the duration of such Option is no more than five (5)
years.
12. Exercise
of Options and Rights.
Except
as otherwise provided herein or in the holder’s employment agreement (if any)
with the Corporation or a Subsidiary, Options and Rights shall become vested
and
exercisable by the holder as determined by the Committee in its sole discretion
at the time of grant and as set forth in the applicable Option and/or Rights
agreement (such vesting may be based on continued employment or service, or
upon
the achievement of pre-established corporate or individual performance
objectives, or otherwise, including any combination thereof but in no event
shall the vesting period be less than three (3) years commencing on the date
of
the grant if based on continued employment or service or less than one (1)
year
commencing on the date of the grant if based on achievement of pre-established
corporate or individual performance objectives, or otherwise, including any
combination thereof ).
Notwithstanding
the foregoing, all or any part of any remaining unexercised Options and/or
Rights granted to any Eligible Person may be exercised, subject to Section
19
hereof, in the following circumstances (but in no event, other than the holder’s
death, during the six (6) month period commencing on the date of grant, and
in
no event prior to approval of the Plan by shareholders of the Corporation as
provided in Section 26 hereof or after the term of the Option or Rights has
expired): (a) upon the holder’s retirement from the Corporation and all
Subsidiaries on or after his 65th birthday; (b) upon the Disability or death
of
the holder; (c) upon a Change of Control while the holder is in the employ
or
service of the Corporation; or (d) upon the occurrence of such special
circumstance or event as in the opinion of the Committee merits special
consideration.
7
An
Option
shall be exercised by the delivery of a written notice duly signed by the holder
thereof to such effect, together with the Option agreement (and, in the case
of
the exercise of an Option with respect to which Alternative Rights were granted
in relation thereto, the related Rights agreement) and the full purchase price
of the Shares purchased pursuant to the exercise of the Option, to the Chairman
of the Board of Directors or an officer of the Corporation appointed by the
Chairman of the Board of Directors for the purpose of receiving the same.
Payment of the full purchase price shall be made as follows: in cash or by
check
payable to the order of the Corporation; by delivery to the Corporation of
Shares which shall be valued at their Fair Market Value on the date of exercise
of the Option (provided, that a holder may not use any Shares to pay the
purchase price unless the holder has beneficially owned such Shares for at
least
six (6) months); or by such other methods as the Committee may permit from
time
to time.
Within
a
reasonable time after the exercise of an Option, the Corporation shall cause
to
be delivered to the person entitled thereto, a certificate for the Shares
purchased pursuant to the exercise of the Option. If the Option shall have
been
exercised with respect to less than all of the Shares subject to the Option,
the
Corporation shall also cause to be delivered to the person entitled thereto
a
new Option agreement in replacement of the agreement surrendered at the time
of
the exercise of the Option, indicating the number of Shares with respect to
which the Option remains available for exercise, or the original Option
agreement shall be endorsed to give effect to the partial exercise thereof.
The
Committee may permit deemed or constructive transfers of Shares in lieu of
actual transfer and physical delivery of certificates.
Upon
the
exercise of an Option with respect to which Alternative Rights were also granted
in relation thereto, the number of Shares subject to exercise under the related
Alternative Rights shall also be reduced by the number of Shares for which
the
related Option was exercised. If the Option shall have been exercised with
respect to less than all of the Shares subject thereto, the Corporation shall
also cause to be delivered to the person entitled thereto a new Option agreement
and a new Rights agreement in replacement of the Option and Rights agreements
surrendered at the time of the partial exercise of the Option, with respect
to
the difference between the number of Shares under the Option agreement (and
the
Rights agreement) immediately before the exercise of the Option and the number
of Shares with respect to which the Option was so exercised, or the original
Option agreement and the original Rights agreement shall be endorsed to give
effect to the partial exercise (and surrender) thereof.
Alternative
Rights or Stock Appreciation Rights shall be exercised by the delivery of a
duly
signed notice in writing to such effect, together with the Rights agreement.
Holders of Alternative Rights shall also surrender the related Option agreement.
Within a reasonable time thereafter, the Corporation shall cause to be delivered
to the person entitled thereto, a certificate for the number of Shares
determined in accordance with Section 9 hereof. Upon the exercise of
Alternative Rights, the number of Shares subject to exercise under the related
Option or portion thereof shall be reduced by the number of Shares represented
by the Option or portion thereof surrendered. If the Rights shall have been
exercised with respect to less than all of the Shares subject thereto, the
Corporation shall also cause to be delivered to the person entitled thereto
a
Rights agreement (and an Option agreement, in the case of Alternative Rights)
with respect to the difference between the number of Shares under the Rights
agreement (and related Option agreement, if any) surrendered at the time of
the
exercise of the Rights and the number of Shares with respect to which the Rights
were so exercised, or the original Rights agreement (and related Option
agreement, if any) shall be endorsed to give effect to the partial exercise
(and
surrender) thereof.
8
Notwithstanding
any other provision of the Plan or of any Option or Rights agreement, no Option
or Rights granted pursuant to the Plan may be exercised at any time when the
Option or Rights or the granting or exercise thereof violates any law or
governmental order or regulation.
13. Terms
and Conditions of Restricted Stock Awards.
The
Committee shall have the authority to grant to any Eligible Person a Restricted
Stock Award, subject to the following terms and conditions:
(a) All
Restricted Shares granted to or purchased by an Eligible Person pursuant to
the
Plan shall be subject to the following conditions:
(1) except
as
otherwise provided in the holder’s employment agreement (if any) with the
Corporation or a Subsidiary, the Restricted Shares shall be subject to such
transfer restrictions and risk of forfeiture as the Committee shall determine
at
the time the Restricted Stock Award is granted, until such specific conditions
are met (which conditions may be based on continued employment or service,
or
achievement of pre-established corporate or individual performance objectives,
or otherwise, including any combination thereof), and such restrictions shall
lapse, and the Restricted Shares subject to a Restricted Stock Award shall
vest,
as determined by the Committee in its sole discretion at the time of grant
and
as set forth in the applicable Restricted Stock Award agreement but in no event
shall the vesting period be less than three (3) years commencing on the date
of
the grant if based on continued employment or service or less than one (1)
year
commencing on the date of the grant if based on achievement of pre-established
corporate or individual performance objectives, or otherwise, including any
combination thereof;
(2) the
Restricted Shares may not be sold, transferred, or otherwise alienated or
hypothecated until the restrictions are satisfied, removed or
expire;
(3) each
certificate representing Restricted Shares issued pursuant to a Restricted
Stock
Award under this Plan shall bear a legend making appropriate reference to the
restrictions imposed;
(4) the
Committee may impose such other conditions as it may deem advisable on any
Restricted Shares granted to or purchased by an Eligible Person pursuant to
a
Restricted Stock Award under this Plan, including, without limitation,
restrictions under the requirements of any stock exchange upon which such Shares
or shares of the same class are then listed, and under any securities law
applicable to such Shares; and
(5) Notwithstanding
the foregoing, all restrictions to which a Restricted Stock Award is subject
shall lapse, in the following circumstances: (a) upon the holder’s retirement
from the Corporation and all Subsidiaries on or after his 65th birthday; (b)
upon the Disability or death of the holder; (c) upon a Change of Control while
the holder is in the employ or service of the Corporation; or (d) upon the
occurrence of such special circumstance or event as in the opinion of the
Committee merits special consideration.
9
(b) Prior
to
the satisfaction, expiration or lapse of all of the restrictions and conditions
imposed upon Restricted Shares, a stock certificate or certificates representing
such Restricted Shares shall be registered in the holder’s name but shall be
retained by the Corporation for the holder’s account. The holder shall have the
right to vote such Restricted Shares and shall have all other rights and
privileges of a beneficial and record owner with respect thereto, including,
without limitation, the right to receive dividends, distributions and
adjustments with respect thereto; provided, however, that such dividends,
distributions and adjustments shall be retained by the Corporation for the
holder’s account and for delivery to the holder, together with the stock
certificate or certificates representing such Restricted Shares, as and when
said restrictions and conditions shall have been satisfied, expired or lapsed.
(c) A
Restricted Stock Award shall be evidenced by an agreement executed on behalf
of
the Corporation and by the Eligible Person to whom the Restricted Stock Award
is
granted. The form of Restricted Stock Award agreement shall be determined from
time to time by the Committee, and need not be identical with respect to each
grantee.
14. Restricted
Stock Purchase Price.
Except
as otherwise provided in the holder’s employment agreement (if any) with the
Corporation or a Subsidiary, the purchase price per Share for Restricted Shares
to be purchased pursuant to Restricted Stock Awards shall be fixed by the
Committee at the time of the grant of the Restricted Stock Award and shall
be
set forth in the applicable Restricted Stock Award agreement; provided, however,
that such purchase price shall not be less than the par value of such Shares.
Payment of such purchase price shall be made in cash or by check payable to
the
order of the Corporation, or by such other method as the Committee may
permit.
15. Deferred
Stock Awards.
The
Committee shall have the authority to grant to any Eligible Person a Deferred
Stock Award, subject to the following terms and conditions:
(a) Delivery
of, and the issuance of certificates representing, Shares issuable pursuant
to a
Deferred Stock Award shall occur upon expiration of the deferral period
specified by the Committee;
(b) Deferred
Stock Awards shall be subject to such restrictions as the Committee may impose,
in its sole discretion at the time of grant and as set forth in the applicable
Deferred Stock Award agreement (such restrictions may lapse based on continued
employment or service, upon the achievement of pre-established corporate or
individual performance objectives, at the expiration of a specified deferral
period or at earlier specified times, separately or in combination, in
installments, or otherwise, including any combination thereof but in no event
shall the restriction period be less than three (3) years if based on continued
employment or service or less than one (1) year if based upon the achievement
of
pre-established corporate or individual performance objectives, at the
expiration of a specified deferral period or at earlier times, separately or
in
combination, in installments, or otherwise, including any combination thereof);
10
(c) Notwithstanding
the foregoing, all restrictions to which a Deferred Stock Award is subject
shall
lapse, in the following circumstances: (a) upon the holder’s retirement from the
Corporation and all Subsidiaries on or after his 65th birthday; (b) upon the
Disability or death of the holder; (c) upon a Change of Control while the holder
is in the employ or service of the Corporation; or (d) upon the occurrence
of
such special circumstance or event as in the opinion of the Committee merits
special consideration; and
(d) A
Deferred Stock Award shall be evidenced by an agreement executed on behalf
of
the Corporation and by the Eligible Person to whom the Deferred Stock Award
is
granted. The form of Deferred Stock Award agreement shall be determined from
time to time by the Committee, and need not be identical with respect to each
grantee.
16. Performance
Awards.
The
Committee shall have the authority to grant to any Eligible Person a Performance
Award, subject to such terms and conditions as shall be determined by the
Committee in its sole discretion at the time of grant and as set forth in the
applicable Performance Award agreement. The value of a Performance Award may
be
linked to the market value, book value, net profits or other measure of the
value of a Share, or other specific performance criteria determined appropriate
by the Committee, in each case on a specified date or dates or over any period
or periods determined by the Committee, or may be based upon the appreciation
in
the market value, book value, net profits or other measure of the value of
a
specified number of Shares over a fixed period or periods determined by the
Committee; provided, however, that the dates or periods described herein shall
not be prior to or less than one (1) year following the date of the grant.
In
making such determinations, the Committee shall consider (among such other
factors as it deems relevant in light of the specific type of award) the
contributions, responsibilities and other compensation of the particular
Eligible Person. A Performance Award shall be evidenced by an agreement executed
on behalf of the Corporation and by the Eligible Person to whom the Performance
Award is granted. The form of Performance Award agreement shall be determined
from time to time by the Committee, and need not be identical with respect
to
each grantee.
17. Consideration
for Incentive Awards.
The
Corporation shall obtain such consideration for the grant of an Incentive Award
as the Committee in its discretion may determine.
18. Restrictions
on Transferability of Incentive Awards.
Incentive Awards and all other rights thereunder shall be non-transferable
and
non-assignable by the holder thereof except to the extent that the estate of
a
deceased holder of an Incentive Award may be permitted to exercise them. Options
and Rights may be exercised or surrendered during the holder’s lifetime only by
the holder thereof.
19. Termination
of Employment or Service.
(a) Except
as
otherwise provided
herein, in the holder’s employment agreement (if any) with the Corporation or a
Subsidiary, or in the applicable Option and/or Rights agreement,
all or
any part of any Option and/or Rights, to the extent unexercised, shall terminate
immediately upon the cessation or termination for any reason of the holder’s
employment by, or service as a director of, the Corporation or any Subsidiary,
provided that (except as otherwise provided herein, in the holder’s employment
agreement (if any) with the Corporation or a Subsidiary, or in the applicable
Option and/or Rights agreement) the holder shall have ninety (90) days following
the cessation of the holder’s employment or service with the Corporation or its
Subsidiaries, and no longer, within which to exercise any unexercised Option
and/or Rights that such holder could have exercised on the day on which such
employment or service terminated; and provided, further, that such exercise
must
be accomplished prior to the expiration of the term of such Option and/or
Rights. Notwithstanding the foregoing, if the cessation of employment or service
is due to Disability or to death, the holder or the representative of the Estate
or the heirs of a deceased holder shall have the privilege of exercising the
Options and/or Rights which are vested but unexercised at the time of such
Disability or death for a period of time that is no less than one (1) year
from
the date of the holder’s Disability or death. Notwithstanding the foregoing, and
except as otherwise provided in the holder’s employment agreement (if any) with
the Corporation or a Subsidiary, if the employment or service of any holder
of
an Option and/or Rights with the Corporation or a Subsidiary shall be terminated
for Cause, all unexercised Options and/or Rights of such holder shall terminate
immediately upon such termination of the holder’s employment or service with the
Corporation and all Subsidiaries, and a holder of Options and/or Rights whose
employment or service with the Corporation and all Subsidiaries is so
terminated, shall have no right after such termination to exercise any
unexercised Option and/or Rights he might have exercised prior to the
termination of his employment or service with the Corporation and all
Subsidiaries.
11
(b) Except
as
otherwise provided in the holder’s employment agreement (if any) with the
Corporation or a Subsidiary, the Committee shall determine in its sole
discretion at the time of grant of a Restricted Stock Award or a Deferred Stock
Award, the affect, if any, that a termination of the holder’s employment or
service with the Corporation or any Subsidiary shall have on such Incentive
Award, and such terms shall be set forth in the applicable Incentive Award
agreement. Notwithstanding the foregoing, and except as otherwise provided
in
the holder’s employment agreement (if any) with the Corporation or a Subsidiary,
if the employment or service of any holder of a Restricted Stock Award or a
Deferred Stock Award with the Corporation or a Subsidiary shall be terminated
for Cause, then (i) all Restricted Shares subject to restrictions at the time
his employment terminates (and any dividends, distributions and adjustments
retained by the Corporation with respect thereto), and (ii) any Shares
subject to a Deferred Stock Award with respect to which the deferral period
has
not expired, shall be forfeited and any consideration received therefor from
the
holder shall be returned to the holder.
(c) Except
as
otherwise provided in the holder’s employment agreement (if any) with the
Corporation or a Subsidiary, the Committee shall determine in its sole
discretion at the time of grant of a Performance Award, the affect, if any,
that
a termination of the holder’s employment or service with the Corporation or any
Subsidiary shall have on such Performance Award, and such terms shall be set
forth in the applicable Performance Award agreement. Notwithstanding the
foregoing, and except as otherwise provided in the holder’s employment agreement
(if any) with the Corporation or a Subsidiary, if the employment or service
of
any holder of a Performance Award with the Corporation or a Subsidiary shall
be
terminated for Cause, then such holder’s Performance Award shall terminate
immediately upon such termination of the holder’s employment or service with the
Corporation and all Subsidiaries.
20. Adjustment
Provision.
If,
prior to the complete exercise of any Option and/or Rights, or prior to the
satisfaction, expiration or lapse of all of the restrictions and conditions
imposed pursuant to a Restricted Stock Award or Deferred Stock Award, there
shall be declared and paid a stock dividend upon the Shares or if the Shares
shall be split up, converted, exchanged, reclassified, or in any way substituted
for:
12
(a) in
the
case of an Option, then the Option, to the extent that it has not been
exercised, shall entitle the holder thereof upon the future exercise of the
Option to such number and kind of securities or cash or other property subject
to the terms of the Option to which he would have been entitled had he actually
owned the Shares subject to the unexercised portion of the Option at the time
of
the occurrence of such stock dividend, split-up, conversion, exchange,
reclassification or substitution, and the aggregate purchase price upon the
future exercise of the Option shall be the same as if the originally optioned
Shares were being purchased thereunder; provided, however, that with respect
to
an Option that is an incentive stock option, such adjustment shall be made
in
accordance with Section 424 of the Code;
(b) in
the
case of an Alternative Right, then the number of Shares subject to the
Alternative Right, to the extent that it has not been exercised, shall be
adjusted to equal the number of Shares to which the holder would have been
entitled had he actually owned the Shares subject to the unexercised portion
of
the Alternative Right at the time of the occurrence of such stock dividend,
split-up, conversion, exchange, reclassification or substitution, and the
aggregate exercise price shall proportionately be adjusted so that the aggregate
exercise price of such Alternative Right immediately prior to such an event
shall be equal to the aggregate exercise price of the adjusted Alternative
Right
immediately following the occurrence of such event;
(c) in
the
case of a Stock Appreciation Right, then the number of Shares subject to the
Stock Appreciation Right, to the extent that it has not been exercised, shall
be
adjusted to equal the number of Shares to which the holder would have been
entitled had he actually owned the Shares subject to the unexercised portion
of
the Stock Appreciation Right at the time of the occurrence of such stock
dividend, split-up, conversion, exchange, reclassification or substitution,
and
the aggregate exercise price shall proportionately be adjusted so that the
aggregate exercise price of such Stock Appreciation Right immediately prior
to
such an event shall be equal to the aggregate exercise price of the adjusted
Stock Appreciation Right immediately following the occurrence of such event;
(d) in
the
case of a Restricted Share issued pursuant to a Restricted Stock Award, the
holder of such Restricted Stock Award shall receive, subject to the same
restrictions and other conditions of such Restricted Stock Award as determined
pursuant to the provisions of Section 13, the same securities or other property
as are received by the holders of the Corporation’s Shares pursuant to such
stock dividend, split-up, conversion, exchange, reclassification or
substitution; and
(e) in
the
case of a Deferred Stock Award, the holder shall receive, at such time as would
otherwise apply under such Deferred Stock Award, such number and kind of
securities or cash or other property to which he would have been entitled had
he
actually owned the Shares subject to the Deferred Stock Award at the time of
the
occurrence of such stock dividend, split-up, conversion, exchange,
reclassification or substitution.
With
respect to any Incentive Awards other than Rights, any fractional shares or
securities issuable as a result of such adjustment shall be payable in cash
based upon the Fair Market Value of such shares or securities at the time such
shares or securities would have otherwise been issued. With respect to any
Rights, any fractional shares or securities issuable as a result of such
adjustment shall be rounded down to the nearest whole number of Shares. If
any
such event should occur, the number of Shares with respect to which Incentive
Awards remain to be issued, or with respect to which Incentive Awards may be
reissued, shall be adjusted in a similar manner.
13
In
addition to the adjustments provided for in the preceding paragraph, upon the
occurrence of any of the events referred to in said paragraph prior to the
complete payments pursuant to a Performance Award, the Committee, in its sole
discretion, shall determine the amount of cash and/or the number of Shares
which
shall be paid to the holder of a Performance Award at such time as payment
would
otherwise be made, so that there shall be no increase or dilution in the cash
and/or value of the Shares or other property to which the holder shall be
entitled by reason of such events.
Notwithstanding
any other provision of the Plan, in the event of a recapitalization, merger,
consolidation, rights offering, separation, reorganization or liquidation,
or
any other change in the corporate structure or outstanding shares, the
Committee, in its sole discretion, may make such adjustments to the number
of
Shares and the class of shares available hereunder or to any outstanding
Incentive Awards as shall be necessary to prevent dilution or enlargement of
rights, and/or make provision for the payment of cash (or other property if
received as consideration) in cancellation of any outstanding Incentive
Award.
21. Issuance
of Shares and Compliance with Securities Act.
The
Corporation may postpone the issuance and delivery of Shares pursuant to the
grant or exercise of any Incentive Award until (a) the admission of such
Shares to listing on the principal securities exchange or securities trading
market on which Shares of the Corporation of the same class are then listed
or
approved for trading, and (b) the completion of such registration or other
qualification of such Shares under any State or Federal law, rule or regulation
as the Corporation shall determine to be necessary or advisable. Any holder
of
an Incentive Award shall make such representations and furnish such information
as may, in the opinion of counsel for the Corporation, be appropriate to permit
the Corporation, in the light of the then existence or non-existence with
respect to such Shares of an effective Registration Statement under the
Securities Act of 1933, as from time to time amended (the “Securities Act”), to
issue the Shares in compliance with the provisions of the Securities Act or
any
comparable act. The Corporation shall have the right, in its sole discretion,
to
legend any Shares which may be issued pursuant to the grant or exercise of
any
Incentive Award, or may issue stop transfer orders in respect
thereof.
22. Code
Section 162(m).
Notwithstanding any other provision of the Plan, if the Committee determines
at
the time an Incentive Award is granted to an Eligible Person who is, or is
likely to be, as of the end of the tax year in which the Corporation would
claim
a tax deduction in connection with such Incentive Award, a “covered employee”
(as defined under Section 162(m) of the Code), then the Committee may provide
that this Section 22 is applicable to such Incentive Award. If
the
Committee determines that an Incentive Award is subject to this Section 22,
the
lapsing of restrictions thereon and the distribution of cash, Shares or other
property pursuant thereto, as applicable, shall be subject to the achievement
of
one or more objective performance goals established by the Committee, which
shall be based on the attainment of specified levels of one or any combination
of the following: revenue growth; booking of orders; earnings, or some
derivative thereof (including earnings before interest and taxes, earnings
before interest, taxes, depreciation and amortization, or earnings per share);
operating income; pre- or after-tax income; cash flow; net earnings; return
on
equity; return on capital (including return on total capital or return on
invested capital); return on assets or net assets; economic value added (or
an
equivalent metric); share price performance; total shareholder return;
improvement in or attainment of expense levels; and improvement in or attainment
of working capital levels of the Corporation or any Subsidiary, division,
business unit or product line of the Corporation for or within which the
Eligible Person is primarily employed. Such performance goals also may be based
solely by reference to the Corporation’s performance or the performance of a
Subsidiary, division, business unit or product line of the Corporation, or
based
upon the relative performance of other companies or upon comparisons of any
of
the indicators of performance relative to other companies. The Committee may
also exclude the impact of an event or occurrence which the Committee determines
should appropriately be excluded, including (i) restructurings, discontinued
operations, extraordinary items, and other unusual or non-recurring charges,
(ii) an event either not directly related to the operations of the Corporation
or not within the reasonable control of the Corporation’s management, or (iii)
the cumulative effects of tax or accounting changes in accounting standards
required by generally accepted accounting principles. Such performance goals
shall be set by the Committee within the time period prescribed by, and shall
otherwise comply with the requirements of, Section 162(m) of the Code, and
the
regulations thereunder.
14
23. Income
Tax Withholding.
If the
Corporation or a Subsidiary shall be required to withhold any amounts by reason
of any Federal, State, local or foreign tax rules or regulations in respect
of
any Incentive Award, the Corporation or the Subsidiary shall be entitled to
take
such action as it deems appropriate in order to ensure compliance with such
withholding requirements. In order to facilitate payment by the holder of an
Incentive Award of his withholding obligations with respect to the Incentive
Award, the Corporation or Subsidiary may, at its election, (a) deduct from
any
cash payment otherwise due to the holder, the appropriate withholding amount,
(b) require the holder to pay to the Corporation or Subsidiary in cash the
appropriate withholding amount, (c) permit the holder to elect to have the
Corporation withhold a portion of the Shares otherwise to be delivered with
respect to such Incentive Award, the Fair Market Value of which is equal to
the
minimum statutory withholding amount, or (d) permit the holder to elect to
deliver to the Corporation Shares already owned by the holder for at least
six
(6) months, the Fair Market Value of which is equal to the appropriate
withholding amount; provided, however, that if Shares are to be withheld by
the
Corporation for purposes of satisfying such withholding obligations, the number
of Shares withheld shall be calculated using the minimum statutory withholding
rates.
24. Amendment
of the Plan.
Except
as hereinafter provided, the Board of Directors or the Committee may at any
time
withdraw or from time to time amend the Plan as it relates to, and the terms
and
conditions of, any Incentive Awards not theretofore granted, and the Board
of
Directors or the Committee may at any time withdraw or from time to time amend
the Plan as it relates to, and the terms and conditions of, any outstanding
Incentive Award, provided that any amendment of an outstanding Incentive Award
that would adversely affect the rights of the holder thereof shall not be
effected without the holder’s consent. Notwithstanding the foregoing, any
material amendment of the Plan by the Board of Directors or the Committee,
including an amendment which would increase the number of Shares issuable under
the Plan or to any individual or change the class of Eligible Persons, shall
be
subject to the approval of the shareholders of the Corporation within one (1)
year of such amendment.
15
25. No
Right of Employment or Service.
Nothing
contained herein or in an Incentive Award agreement shall be construed to confer
on any employee or director any right to be continued in the employ of the
Corporation or any Subsidiary or as a director of the Corporation, or derogate
from any right of the Corporation and any Subsidiary to retire, request the
resignation of, or discharge such employee or director (without or with pay),
at
any time, with or without Cause.
26. Effective
Date of the Plan.
This
Plan is conditioned upon its approval by the shareholders of the Corporation
on
or before April 18, 2006; except that this Plan is adopted and approved by
the
Board of Directors effective April 18, 2005 to permit the grant of Incentive
Awards prior to the approval of the Plan by the shareholders of the Corporation
as aforesaid. In the event that this Plan is not approved by the shareholders
of
the Corporation as aforesaid, this Plan and any Incentive Awards granted
hereunder shall be void and of no force or effect.
27. Final
Grant Date.
No
Incentive Award shall be granted under the Plan after April 18,
2015.
IN
WITNESS WHEREOF, the Corporation has caused these presents to be executed by
its
duly authorized officer as of June 23, 2005.
| THE CHILDREN’S PLACE RETAIL STORES, INC. | ||
| |
|
|
| By: | /s/ Steven Balasiano | |
|
Title: Senior Vice President, General Counsel
and
Chief Administrative Officer
|
||
16
EXHIBIT
5
STROOCK
& STROOCK & LAVAN LLP
180
MAIDEN LANE
NEW
YORK,
N.Y. 10038
June
21,
2006
The
Children's Place Retail Stores, Inc.
915
Secaucus Road
Secaucus,
New Jersey 07094
| Re: |
The
Children's Place Retail Stores, Inc.
Registration
Statement on Form S-8
|
Ladies
and Gentlemen:
We
have
acted as counsel to The Children’s Place Retail Stores, Inc. (the “Company”) in
connection with the preparation and filing of the above-captioned Registration
Statement on Form S-8 (the “Registration Statement”) under the Securities Act of
1933, as amended, covering 2,000,000 shares (the “Original Shares”) of the
Company's Common Stock, par value $0.10 per share (the “Common Stock”), issuable
pursuant to the Amended and Restated 2005
Equity Incentive Plan of The Children’s Place Retail Stores, Inc. (the “Plan”)
and such additional shares (the “Additional Shares”) as may be issued pursuant
to adjustment provisions of the Plan. The Original Shares and the Additional
Shares are hereinafter referred to together as the “Shares.”
We
have
examined copies of the Amended and Restated Certificate of Incorporation and
the
By-laws of the Company, each as amended to date, the Registration Statement
(including the exhibits thereto), the Plan, the minutes of various meetings
of
the Board of Directors of the Company, and the originals, copies or certified
copies of all such records of the Company, and all such agreements, certificates
of public officials, certificates of officers and representatives of the Company
or others, and such other documents, papers, statutes and authorities as we
have
deemed necessary to form the basis of the opinion hereinafter expressed. In
such
examination, we have assumed the genuineness of signatures and the conformity
to
original documents of the documents supplied to us as copies. As to various
questions of fact material to such opinion, we have relied upon statements
and
certificates of officers of the Company and others.
Attorneys
involved in the preparation of this opinion are admitted to practice law in
the
State of New York and we do not purport to be experts on, or express any opinion
herein concerning, any law other than the laws of the State of New York, the
federal laws of the United States of America and the General Corporation Law
of
the State of Delaware.
Based
upon the foregoing, we are of the opinion that the Shares have been duly
authorized and, upon issuance thereof under the circumstances contemplated
by
the Registration Statement and in accordance with the terms of the Plan, will
be
validly issued, fully paid and nonassessable.
We
hereby
consent to your filing a copy of this opinion as an exhibit to the Registration
Statement. In giving such consent, we do not admit hereby that we come within
the category of persons whose consent is required under Section 7 of the Act,
or
the rules and regulations of the Securities and Exchange Commission
thereunder.
|
Very
truly yours,
/S/
STROOCK & STROOCK & LAVAN LLP
STROOCK
& STROOCK & LAVAN LLP
|
EXHIBIT
23.2
CONSENT
OF INDEPENDENT PUBLIC ACCOUNTANTS
We
consent to the incorporation by reference in this Registration Statement
on Form
S-8 of our report dated April 11, 2006 relating to the consolidated financial
statements and financial statement schedule of The Children’s Place Retail
Stores, Inc. and subsidiaries (which report is unqualified and included an
explanatory paragraph referring to the Company’s early adoption in 2005 and
retrospective application in 2004 and 2003 of FASB Staff Position (FSP) No.
13-1, “Accounting for Rental Costs Incurred during a Construction Period”) and
our report dated April 11, 2006 relating to management’s report on the
effectiveness of internal control over financial reporting appearing in the
Annual Report on Form 10-K of The Children’s Place Retail Stores, Inc., for the
fiscal year ended January 28, 2006.
|
/s/
DELOITTE & TOUCHE LLP
DELOITTE
& TOUCHE LLP
|
Parsippany,
New Jersey
June
21,
2006