As Filed with the Securities and Exchange Commission on August 25, 1999
Registration Statement No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
CATHERINES STORES CORPORATION
(Exact name of registrant as specified in its charter)
Tennessee 62-1350411
(State of Incorporation) (I.R.S. Employer Identification No.)
3742 Lamar Avenue
Memphis, Tennessee 38118
(Address of principal executive offices)
CATHERINES STORES CORPORATION 1994 OMNIBUS INCENTIVE PLAN, AS AMENDED
(Full Title of the Plan)
DAVID C. FORELL
Executive Vice President and
Chief Financial Officer
3742 Lamar Avenue
Memphis, Tennessee 38118
(901) 363-3900
(Name, address and telephone number of agent for service)
(with copies to:)
SAMUEL D. CHAFETZ, ESQ.
Waring Cox
50 N. Front Street
Suite 1300
Memphis, Tennessee 38103
CALCULATION OF REGISTRATION FEE
Proposed
Proposed Maximum
Maximum Aggregate Amount of
Title Of Securities Amount To Be Offering Price Offering Registration
To Be Registered Registered Per Share(1) Price(1) Fee(1)
- ------------------ -------------- --------------- --------- --------------
Option and Shares,
Common Stock,
$0.01 par value . . . . 500,000 shares $14.09 $7,045,000 $1,958.51
=========================== ==================== =================== ===================== ===================
(1)Estimated solely for the purpose of calculating the registration fee pursuant
to Rule 457(c) based upon the average of the high and low prices of the Common
Stock on the NASDAQ National Market System on August 20, 1999.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
All information required by Part I to be contained in the Prospectus is
omitted from the Registration Statement in accordance with Rule 428 under the
Securities Act of 1933, as amended (the "1933 Act").
PART II
Item 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission
are incorporated herein by reference:
1. The Registrant's Annual Report on Form 10-K for the year ended January
30, 1999.
2. All reports filed by the Registrant pursuant to Section 13(a) or 15(d)
of the Securities Exchange Act of 1934 (the "1934 Act") since the end of the
fiscal year ended January 30, 1999.
3. The description of the Registrant's Common Stock contained in its
Registration Statement on Form 8-A filed with the Commission on June 24, 1991,
pursuant to Section 12(b) of the 1934 Act.
4. The Registration Statement on Form S-8 (File No. 33-79598) pertaining to
the Catherines Stores Corporation 1994 Omnibus Incentive Plan.
All documents subsequently filed by the registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the 1934 Act, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part thereof from the date of
filing of such documents.
Any statement contained in a document 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 other
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
No response is required to this item.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
No response is required to this item.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 48-18-502 of the Tennessee Business Corporation Act provides that a
Tennessee corporation may indemnify an individual 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,
whether formal or informal (hereinafter, a "proceeding") (other than a
2
proceeding by or in the right of the corporation in which the director was
adjudged liable or in connection with any other proceeding in which the director
was adjudged liable on the basis that he improperly received personal benefit)
because he is or was a director of the corporation or, while a director of the
corporation, is or was serving at the request of the corporation as a director,
officer, partner, trustee, employee or agent of another corporation or
enterprise, against expenses, judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such proceeding if he
acted in good faith and in a manner he reasonably believed to be in or, in
certain circumstances, not opposed to the best interests of the corporation,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful.
Section 48-15-503 further provides that to the extent a director of a
corporation has been wholly successful in the defense of any proceeding, he
shall be indemnified against expenses actually and reasonably incurred by him in
connection therewith, unless otherwise limited in the corporation's charter. The
Company's Charter does not limit this right to indemnification.
Section 48-15-504 of the Tennessee Business Corporation Act provides that a
corporation may pay for or reimburse the reasonable expenses incurred by a
director who is a party to a proceeding in advance of final disposition of the
proceeding if the director furnishes the corporation a written affirmation of
his good faith belief that he met the standard of conduct described in
ss.48-18-502; he furnishes the corporation a written unlimited obligation to
repay the advance if it is ultimately determined that he is not entitled to
indemnification; and a determination is made that the facts then known to those
making this determination would not preclude indemnification.
Section 48-18-508 provides that a corporation may purchase and maintain
insurance on behalf of a director of the corporation against liability asserted
against him in that capacity or arising out of his status as such, whether or
not the corporation would have the power to indemnify him against the same
liability under ss.48-18-502 or ss.48-18- 503.
Section 48-18-507 extends similar standards for indemnification and
insurance to officers, employees and agents.
Section 48-12-102 of the Tennessee Business Corporation Act provides that a
corporation in its charter may eliminate or limit personal liability of members
of its board of directors or shareholders for breach of a director's fiduciary
duty. However, no such provision may eliminate or limit the liability of a
director or shareholder for breaching his duty of loyalty, failing to act in
good faith, engaging in intentional misconduct or knowingly violating a law,
voting or assenting to a distribution which was illegal. A provision of this
type limits liability for monetary damages only and has no effect on the
availability of equitable remedies, such as injunctions or rescission, for
breach of fiduciary duty. The Company's Charter contains such a provision.
The Company's Bylaws provide that the Company shall indemnify officers and
directors, and to the extent authorized by the Board of Directors, employees and
agents of the Company, to the full extent permitted by and in the manner
permissible under the laws of the State of Tennessee. The Bylaws also permit the
Board of Directors to authorize the Company to purchase and maintain insurance
against any liability asserted against any director, officer, employee or agent
of the Company arising out of his capacity as such, and the Company has
purchased such insurance.
The Company has entered into and intends to execute indemnity agreements
with present and future directors for indemnification of and advance of expenses
to such persons to the full extent permitted by law.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
No response is required to this item.
3
Item 8. EXHIBITS
Exhibit Number Description
4 Catherines Stores Corporation 1994 Omnibus Incentive Plan,
as amended
5 Opinion and Consent of Waring Cox
23.1 Consent of Waring Cox (contained in Exhibit 5)
23.2 Consent of Arthur Andersen LLP
24 Power of Attorney
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 (the "1933 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.
(b) The undersigned registrant hereby undertakes that, for the purposes of
determining any liability under the 1933 Act, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the 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.
(c) Insofar as indemnification for liabilities arising under the 1933 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 1933 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 1933 Act and will be governed by the final
adjudication of such issue.
4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Memphis, State of Tennessee, on the 25th day of
August, 1999.
CATHERINES STORES CORPORATION
By: /s/ David C. Forell
-------------------
David C. Forell
Executive Vice President,
Chief Financial Officer and Secretary
5
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned Officers and Directors
of Catherines Stores Corporation, a Tennessee corporation, hereby constitute and
appoint Bernard J. Wein and David C. Forell and each of them, the true and
lawful agents and attorneys-in-fact, and in any one or more of them, to sign for
the undersigned, in their respective names as Officers and Directors of the
Corporation, one or more Registration Statements on Form S-8 (or other
appropriate form) to be filed with the Securities and Exchange Commission,
Washington, D.C., under the Securities Act of 1933, as amended, and any
amendment or supplement to such Registration Statement, relating to the
Catherines Stores Corporation 1994 Omnibus Incentive Plan; hereby ratifying and
confirming all acts taken by such agents and attorneys-in-fact, or any one or
more of them, as herein authorized.
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.
Signature Title Date
/s/ Bernard J. Wein Chairman of the Board, August 23, 1999
- -------------------------------- President and Chief Executive
Bernard J. Wein Officer and Director
(Principal Executive Officer)
/s/ Stanley H. Grossman Director August 23, 1999
- ---------------------------------
Stanley H. Grossman
/s/ David C. Forell Executive Vice President, August 23, 1999
- -------------------------------- Chief Financial Officer, Secretary
David C. Forell and Director (Principal Financial
and Accounting Officer)
/s/ James H. Lindy Director August 23, 1999
- -----------------------------------
James H. Lindy
/s/ Allen B. Morgan, Jr. Director August 23, 1999
- ---------------------------------
Allen B. Morgan, Jr.
/s/ Wellford L. Sanders, Jr. Director August 23, 1999
- ---------------------------------
Wellford L. Sanders, Jr.
/s/ Elliot J. Stone Director August 23, 1999
- ---------------------------------------
Elliot J. Stone
6
EXHIBIT 4
CATHERINES STORES CORPORATION
1994 OMNIBUS INCENTIVE PLAN, AS AMENDED
1. Purpose.
The purpose of the CATHERINES STORES CORPORATION 1994 OMNIBUS INCENTIVE
PLAN (the "Plan") is to further the earnings of CATHERINES STORES CORPORATION, a
Delaware corporation, and its subsidiaries (collectively, the "Company") by
assisting the Company in attracting, retaining and motivating management
employees and directors of high caliber and potential. The Plan provides for the
award of long-term incentives to those officers, other key executives and
directors who make substantial contributions to the Company by their loyalty,
industry and invention.
2. Administration.
The Plan shall be administered by a committee (the "Committee") selected by
the Board of Directors of the Company (the "Board of Directors") consisting
solely of two or more members who are "outside directors" as described in
Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code").
Except to the extent permitted under paragraph 6(h) hereof or Rule 16b-3 under
the Securities Exchange Act of 1934, as amended (the "1934 Act") (or any
successor rule of similar import), each Committee member shall be ineligible to
receive, and shall not have been, during the one-year period prior to
appointment thereto, granted or awarded stock options, stock appreciation
rights, performance units, or restricted stock pursuant to this Plan or any
other similar plan of the Company or any affiliate of the Company. Without
limiting the foregoing, the Committee shall have full and final authority in its
discretion to interpret the provisions of the Plan and to decide all questions
of fact arising in its application. Subject to the provisions hereof, the
Committee shall have full and final authority in its discretion to determine the
employees and directors to whom awards shall be made under the Plan; to
determine the type of awards to be made and the amount, size and terms and
conditions of each such award; to determine the time when awards shall be
granted; to determine the provisions of each agreement evidencing an award; and
to make all other determinations necessary or advisable for the administration
of the Plan.
3. Stock Subject to the Plan.
The Company may grant awards under the Plan with respect to not more than a
total of 1,150,000 shares of $.01 par value common stock of the Company (the
"Shares") (subject, however, to adjustment as provided in paragraph 20, below).
Such Shares may be authorized and unissued Shares or treasury Shares. Except as
otherwise provided herein, any Shares subject to an option or right which for
any reason is surrendered before exercise or expires or is terminated
unexercised as to such Shares shall again be available for the granting of
awards under the Plan. Similarly, if any Shares granted pursuant to restricted
stock awards are forfeited, such forfeited Shares shall again be available for
the granting of awards under the Plan.
4. Eligibility to Receive Awards.
Persons eligible to receive awards under the Plan shall be limited to those
officers, other key employees and directors of the Company who are in positions
in which their decisions, actions and counsel have a significant impact upon the
profitability and success of the Company (but excluding members of the
Committee, except as provided in paragraph 6(h)).
7
5. Form of Awards.
Awards may be made from time to time by the Committee in the form of stock
options to purchase Shares, stock appreciation rights, performance units,
restricted stock, or any combination of the above. Stock options may be options
which are intended to qualify as incentive stock options ("Incentive Stock
Options") within the meaning of Section 422(b) of the Code, or options which are
not intended to so qualify ("Nonqualified Stock Options").
6. Stock Options.
Stock options for the purchase of Shares shall be evidenced by written
agreements in such form not inconsistent with the Plan as the Committee shall
approve from time to time; provided that the maximum number of options which may
be granted to any one grantee during any twelve-month period is 100,000 ((as
adjusted pursuant to paragraph 20, below). Such agreement shall contain the
terms and conditions applicable to the options, including in substance the
following terms and conditions:
(a) Type of Option. Each option agreement shall identify the options
represented thereby as Incentive Stock Options or Nonqualified
Stock Options, as the case may be, and shall set forth the number
of Shares subject to the options.
(b) Option Price. The option exercise price to be paid by the
optionee to the Company for each Share purchased upon the
exercise of an option shall be determined by the Committee, but
shall in no event be less than 100 percent of the fair market
value per Share on the date the option is granted, as determined
by the Committee. Notwithstanding anything herein to the
contrary, the Committee shall not reprice any options to a lower
exercise price at any time during the term of any option granted
under this Plan.
(c) Exercise Term. Each option agreement shall state the period or
periods of time within which the ------------- option may be
exercised, in whole or in part, as determined by the Committee
and subject to such terms and conditions as are prescribed for
such purpose by the Committee, provided that no option shall be
exercisable, except as provided in paragraph 18 or in the event
of Retirement (as defined below), any more rapidly than from (i)
the first anniversary of the date of grant thereof, to the extent
of 25% of the Shares covered thereby, (ii) the second anniversary
of the date of grant thereof, to the extent of an additional 25%
of the Shares covered thereby, (iii) the third anniversary of the
date of grant thereof, to the extent of an additional 25% of the
Shares covered thereby, and (iv) the fourth anniversary of the
date of grant thereof, to the extent of the remaining 25% of the
Shares covered thereby. The Committee, in its discretion, may
provide in the option agreement that the option shall become
immediately exercisable, in whole or in part, in the event of
Retirement. Notwithstanding the foregoing, no option shall be
exercisable after ten years from the date of grant.
(d) Payment for Shares. The purchase price of the Shares with respect
to which an option is exercised shall be payable in full at the
time of exercise in cash, Shares at fair market value, or a
combination thereof, as the Committee may determine and subject
to such terms and conditions as may be prescribed by the
Committee for such purpose. If the purchase price is paid by
tendering Shares, the Committee in its discretion may grant the
optionee a new stock option for the number of Shares used to pay
the purchase price.
(e) Rights Upon Termination. In the event of Termination (as defined
below) of an optionee's status as an employee or director of the
Company for any cause other than Retirement (as defined below),
death or Disability (as defined below), the optionee shall have
the right to exercise the option during its term within a period
of three months after such Termination to the extent that the
option was exercisable at the time of Termination, or within such
other period, and subject to such terms and conditions, as may be
specified by the Committee. (As used herein, "Termination" means,
(i) in the case of an employee, the cessation of the grantee's
employment by the Company for any reason,
8
and (ii) in the case of a director, the cessation of the
grantee's service as a director of the Company; and "Terminates"
has the corresponding meaning. As used herein, "Retirement" means
retirement from active employment (in the case of an employee),
or active service (in the case of a director), with the Company
on or after age 62, or such earlier age with the express written
consent for purposes of the Plan of the Company at or before the
time of such retirement, and "Retires" has the corresponding
meaning. As used herein, "Disability" means a condition that, in
the judgment of the Committee, has rendered a grantee completely
and presumably permanently unable to perform any and every duty
of his regular occupation, and "Disabled" has the corresponding
meaning). In the event that an optionee Retires, dies or becomes
Disabled prior to the expiration of his option and without having
fully exercised his option, the optionee or his Beneficiary (as
defined below) shall have the right to exercise the option during
its term within a period of (i) one year after Termination due to
Retirement, death or Disability, or (ii) one year after death if
death occurs either within one year after Termination due to
Retirement or Disability or within three months after Termination
for other reasons, to the extent that the option was exercisable
at the time of death or Termination, or within such other period,
and subject to such terms and conditions, as may be specified by
the Committee. (As used herein, "Beneficiary" means the person or
persons designated in writing by the grantee as his Beneficiary
with respect to an award under the Plan; or, in the absence of an
effective designation or if the designated person or persons
predecease the grantee, the grantee's Beneficiary shall be the
person or persons who acquire by bequest or inheritance the
grantee's rights in respect of an award). In order to be
effective, a grantee's designation of a Beneficiary must be on
file with the Committee before the grantee's death, but any such
designation may be revoked and a new designation substituted
therefor at any time before the grantee's death.
(f) Nontransferability. Options granted under the Plan shall not be
sold, assigned, transferred, exchanged, pledged, hypothecated, or
otherwise encumbered, other than by will or by the laws of
descent and distribution. During the lifetime of the optionee the
option is exercisable only by the optionee.
(g) Incentive Stock Options. In the case of an Incentive Stock
Option, each option shall be subject to such other terms
conditions and provisions as the Committee determines necessary
or desirable in order to qualify such option as an incentive
stock option within the meaning of Section 422(b) of the Code (or
any amendment or substitute or successor thereto or regulation
thereunder), including in substance, without limitation, the
following:
(i) The purchase price of stock subject to an Incentive Stock
Option shall not be less than 100 percent of the fair market
value of such stock on the date the option is granted, as
determined by the Committee.
(ii) The aggregate fair market value (determined as of the time
the option is granted) of the stock with respect to which
incentive stock options are exercisable for the first time
by an optionee in any calendar year (under all plans of the
Company and its subsidiary corporations (which term, as used
hereinafter, shall have the meaning ascribed thereto in
Section 424(f) of the Code (or successor provision of
similar import))) shall not exceed $100,000.
(iii)No Incentive Stock Option shall be granted to any employee
if at the time the option is granted the individual owns
stock possessing more than 10 percent of the total combined
voting power of all classes of stock of the Company or of a
subsidiary corporation of the Company, unless at the time
such option is granted the option price is at least 110
percent of the fair market value (as determined by the
Committee) of the stock subject to the option
9
and such option by its terms is not exercisable after the
expiration of five years from the date of grant.
(iv) Directors who are not employees of the Company shall not be
eligible to receive Incentive Stock Options.
(v) In the event of Termination of employment by reason of
Retirement, if an Incentive Stock Option is exercised after
the expiration of the exercise periods that apply for
purposes of Section 422 of the Code, the option will
thereafter be treated as a Nonqualified Stock Option.
(h) Automatic Grant of Options to Nonemployee Directors.
Notwithstanding any other provision of the Plan, the grant of
options hereunder to directors who are not also employees of the
Company ("Nonemployee Directors") shall be subject to the
following terms and conditions:
(i) Immediately following each of the nine consecutive annual
meetings of the stockholders of the Company ("Annual
Meeting") beginning with the 1994 Annual Meeting, each
Nonemployee Director of the Company who is then incumbent
shall be granted a Nonqualified Stock Option to purchase
2,500 Shares (as adjusted pursuant to paragraph 20, below).
(ii) If, during the period beginning with the 1994 Annual Meeting
and ending with the 2003 Annual Meeting, a person is elected
or appointed as a Nonemployee Director of the Company other
than at an Annual Meeting, such person shall thereupon be
granted a Nonqualified Stock Option to purchase 2,500 Shares
(as adjusted pursuant to paragraph 20, below).
(iii)The purchase price of stock subject to an option granted to
Nonemployee Directors under this paragraph 6(h) shall be
equal to 100 percent of the fair market value of such stock
on the date the option is granted, as determined by the
Committee.
(iv) Except as provided in paragraph 18, each option granted to
Nonemployee Directors under this paragraph 6(h) shall not be
exercisable until one year after the date of grant;
provided, however, that no portion of the option shall be
exercisable any earlier than the date the Plan is approved
by the stockholders of the Company.
(v) Unless otherwise provided in the Plan, all provisions with
respect to the terms of Nonqualified Stock Options hereunder
shall be applicable to options granted to Nonemployee
Directors under this paragraph 6(h).
(vi) The automatic grants described in this paragraph 6(h) shall
constitute the only awards under the Plan permitted to be
made to Nonemployee Directors.
7. Stock Appreciation Rights.
Stock appreciation rights (SARs) shall be evidenced by written SAR
agreements in such form not inconsistent with the Plan as the Committee shall
approve from time to time; provided that the maximum number of SARs which may be
granted to any one grantee during any twelve-month period is 100,000 ((as
adjusted pursuant to paragraph 20, below). Such SAR agreements shall contain the
terms and conditions applicable to the SARs, including in substance the
following terms and conditions:
10
(a) Award. SARs may be granted in connection with a previously or
contemporaneously granted stock ----- option, or independently of
a stock option. SARs shall entitle the grantee, subject to such
terms and conditions as may be determined by the Committee, to
receive upon exercise thereof all or a portion of the excess of
(i) the fair market value at the time of exercise, as determined
by the Committee, of a specified number of Shares with respect to
which the SAR is exercised, over (ii) a specified price which
shall not be less than 100 percent of the fair market value of
the Shares at the time the SAR is granted, or, if the SAR is
granted in connection with a previously issued stock option, not
less than 100 percent of the fair market value of the Shares at
the time such option was granted. Upon exercise of a SAR, the
number of Shares reserved for issuance hereunder shall be reduced
by the number of Shares covered by the SAR. Shares covered by a
SAR shall not be used more than once to calculate the amount to
be received pursuant to the exercise of the SAR.
(b) SARs Related to Stock Options. If a SAR is granted in relation to
a stock option, (i) the SAR shall -----------------------------
be exercisable only at such times, and by such persons, as the
related option is exercisable; (ii) the grantee's right to
exercise the related option shall be canceled if and to the
extent that the Shares subject to the option are used to
calculate the amount to be received upon the exercise of the
related SAR; (iii) the grantee's right to exercise the related
SAR shall be canceled if and to the extent that the Shares
subject to the SAR are purchased upon the exercise of the related
option; and (iv) the SAR shall not be transferable other than by
will or by the laws of descent and distribution, and shall be
exercisable during the lifetime of the grantee only by him.
Notwithstanding anything herein to the contrary, the Committee
shall not reprice any SARs previously awarded to a lower
specified base price at any time during the term of such SAR.
(c) Term. Each SAR agreement shall state the period or periods of
time within which the SAR may ---- be exercised, in whole or in
part, as determined by the Committee and subject to such terms
and conditions as are prescribed for such purpose by the
Committee, provided that no SAR shall be exercisable, except as
provided in paragraph 18 or in the event of Retirement (as
defined below), any more rapidly than from (i) the first
anniversary of the date of grant thereof, to the extent of 25% of
the Shares covered thereby, (ii) the second anniversary of the
date of grant thereof, to the extent of an additional 25% of the
Shares covered thereby, (iii) the third anniversary of the date
of grant thereof, to the extent of an additional 25% of the
Shares covered thereby, and (iv) the fourth anniversary of the
date of grant thereof, to the extent of the remaining 25% of the
Shares covered thereby. The Committee, in its discretion, may
provide in the SAR agreement that the SAR shall become
immediately exercisable, in whole or in part, in the event of
Retirement. Notwithstanding the foregoing, no SAR shall be
exercisable after ten years from the date of grant.
(d) Termination. SARs shall be exercisable only during the grantee's
tenure as an employee or director of the Company, except that, in
the discretion of the Committee, a SAR may be made exercisable
for up to three months after the grantee is Terminated for any
reason other than Retirement, death or Disability, and for up to
one year after the grantee is Terminated because of Retirement,
death or Disability.
(e) Payment. Upon exercise of a SAR, payment shall be made in cash,
in Shares at fair market value on the date of exercise, or in a
combination thereof, as the Committee may determine at the time
of exercise.
(f) Other Terms. SARs shall be granted in such manner and such form,
and subject to such additional terms and conditions, as the
Committee in its sole discretion deems necessary or desirable,
including without limitation: (i) if granted in connection with
an Incentive Stock Option, in order to satisfy any requirements
set forth under Section 422 of the Code; or, (ii) in order to
avoid any insidertrading liability in connection with a SAR under
Section 16(b) of the 1934 Act.
11
8. Restricted Stock Awards.
Restricted stock awards under the Plan shall consist of Shares free of any
purchase price or for such purchase price as may be established by the Committee
restricted against transfer, subject to forfeiture, and subject to such other
terms and conditions (including attainment of performance objectives) as may be
determined by the Committee. Restricted stock shall be evidenced by written
restricted stock agreements in such form not inconsistent with the Plan as the
Committee shall approve from time to time, which agreement shall contain the
terms and conditions applicable to such awards, including in substance the
following terms and conditions:
(a) Restriction Period. Restrictions shall be imposed for such period
or periods as may be determined ------------------ by the
Committee. The Committee, in its discretion, may provide in the
agreement circumstances under which the restricted stock shall
become immediately transferable and nonforfeitable, or under
which the restricted stock shall be forfeited, provided that no
restricted stock award shall become immediately transferable and
nonforfeitable, except as provided in paragraph 18 or in the
event of Retirement (as defined below), any more rapidly than
from (i) the first anniversary of the date of grant thereof, to
the extent of 25% of the Shares covered thereby, (ii) the second
anniversary of the date of grant thereof, to the extent of an
additional 25% of the Shares covered thereby, (iii) the third
anniversary of the date of grant thereof, to the extent of an
additional 25% of the Shares covered thereby, and (iv) the fourth
anniversary of the date of grant thereof, to the extent of the
remaining 25% of the Shares covered thereby. The Committee, in
its discretion, may provide in the restricted stock agreement
that the restricted stock shall become immediately transferable
and nonforfeitable in the event of Retirement.
(b) Restrictions Upon Transfer. Restricted stock and the right to
vote such Shares and to receive dividends thereon, may not be
sold, assigned, transferred, exchanged, pledged, hypothecated, or
otherwise encumbered, except as herein provided, during the
restriction period applicable to such Shares. Notwithstanding the
foregoing, and except as otherwise provided in the Plan, the
grantee shall have all of the other rights of a stockholder,
including, but not limited to, the right to receive dividends and
the right to vote such Shares.
(c) Certificates. A certificate or certificates representing the
number of restricted Shares granted shall be registered in the
name of the grantee. The Committee, in its sole discretion, shall
determine when the certificate or certificates shall be delivered
to the grantee (or, in the event of the grantee's death, to his
Beneficiary), may provide for the holding of such certificate or
certificates in escrow or in custody by the Company or its
designee pending their delivery to the grantee or Beneficiary,
and may provide for any appropriate legend to be borne by the
certificate or certificates.
(d) Lapse of Restrictions. The restricted stock agreement shall
specify the terms and conditions upon which any restriction upon
restricted stock awarded under the Plan shall expire, lapse, or
be removed, as determined by the Committee. Upon the expiration,
lapse, or removal of such restrictions, Shares free of the
restrictive legend shall be issued to the grantee of his legal
representative.
9. Performance Units.
Performance unit awards under the Plan shall entitle grantees to future
payments based upon the achievements of pre-established long-term performance
objectives and shall be evidenced by written performance unit agreements in such
form not inconsistent with this Plan as the Committee shall approve from time to
time. Such agreements shall contain the terms and conditions applicable to the
performance unit awards, including in substance the following terms and
conditions:
12
(a) Performance Period. The Committee shall establish with respect to
each unit award a performance period of not fewer than two years.
(b) Unit Value. The Committee shall establish with respect to each
unit award value for each unit which shall not thereafter change,
or which may vary thereafter pursuant to criteria specified by
the Committee.
(c) Performance Targets. The Committee shall establish with respect
to each unit award maximum and minimum performance targets to be
achieved during the applicable performance period. Achievement of
maximum targets shall entitle grantees to payment with respect to
the full value of a unit award. Grantees shall be entitled to
payment with respect to a portion of a unit award according to
the level of achievement of targets as specified by the Committee
for performance which achieves or exceeds the minimum target but
fails to achieve the maximum target.
(d) Performance Measures. Performance targets established by the
Committee shall relate to corporate, subsidiary, division, or
unit performance and may be established in terms of growth in
gross revenue, earnings per share, ratios of earnings to equity
or assets, or such other measures or standards as may be
determined by the Committee in its discretion. Multiple targets
may be used and may have the same or different weighting, and
they may relate to absolute performance or relative performance
measured against other companies or businesses.
(e) Adjustments. At any time prior to the payment of a unit award,
the Committee may adjust previously established performance
targets or other terms and conditions, including the Company's or
other corporations' financial performance for Plan purposes, to
reflect major unforeseen events such as changes in laws,
regulations or accounting practices, mergers, acquisitions or
divestitures or other extraordinary unusual or non-recurring
items or events.
(f) Payment of Unit Awards. Following the conclusion of each
performance period, the Committee shall determine the extent to
which performance targets have been attained and any other terms
and conditions satisfied for such period. The Committee shall
determine what, if any, payment is due on the unit award and
whether such payment shall be made in cash, Shares, or a
combination thereof. Payment shall be made in a lump sum or
installments, as determined by the Committee, commencing as
promptly as practicable following the end of the performance
period unless deferred subject to such terms and conditions and
in such form as may be prescribed by the Committee.
(g) Termination. In the event that a grantee is Terminated as an
employee or director by the Company ----------- prior to the end
of the performance period by reason of death, Disability, or
Retirement with the consent of the Company, any unit award, to
the extent earned under the applicable performance targets, shall
be payable at the end of the performance period according to the
portion of the performance period during which the grantee was
employed by or served as a director of the Company, provided that
the Committee shall have the power to provide for an appropriate
settlement of a unit award before the end of the performance
period. Upon any other Termination, participation shall terminate
forthwith and all outstanding unit awards shall be canceled.
10. Loans and Supplemental Cash.
The Committee, in its sole discretion to further the purpose of the Plan,
may provide for supplemental cash payments or loans to individuals in connection
with all or any part of an award under the Plan. Supplemental cash payments
shall be subject to such terms and conditions as shall be prescribed by the
Committee at the time of grant, provided that in no event shall the amount of
payment exceed:
13
(a) In the case of an option, the excess fair market value of a Share
on the date of exercise over the option price multiplied by the
number of Shares for which such option is exercised, or
(b) In the case of a SAR, performance unit, or restricted stock
award, the value of the Shares and other consideration issued in
payment of such award.
Any loan shall be evidenced by a written loan agreement or other instrument in
such form and containing such terms and conditions (including, without
limitation, provisions for interest, payment schedules, collateral, forgiveness
or acceleration) as the Committee may prescribe from time to time.
11. General Restrictions.
Each award under the Plan shall be subject to the requirement that if at
any time the Company shall determine that (i) the listing, registration or
qualification of the Shares subject or related thereto upon any securities
exchange or under any state or federal law, or (ii) the consent or approval of
any regulatory body, or (iii) an agreement by the recipient of an award with
respect to the disposition of Shares, or (iv) the satisfaction of withholding
tax or other withholding liabilities is necessary or desirable as a condition of
or in connection with the granting of such award or the issuance or purchase of
Shares thereunder, such award shall be consummated in whole or in part only if
such listing, registration, qualification, consent, approval, agreement, or
withholding shall have been effected or obtained on terms acceptable to the
Company. Any such restriction affecting an award shall not extend the time
within which the award may be exercised; and neither the Company nor its
directors or officers nor the Committee shall have any obligation or liability
to the grantee or to a Beneficiary with respect to any Shares with respect to
which an award shall lapse or with respect to which the grant, issuance or
purchase of Shares shall not be effected, because of any such restriction.
12. Single or Multiple Agreements.
Multiple awards, multiple forms of awards, or combinations thereof may be
evidenced by a single agreement or multiple agreements, as determined by the
Committee.
13. Rights of the Shareholder.
The recipient of any award under the Plan, shall have no rights as a
shareholder with respect thereto unless and until certificates for Shares are
issued to him, and the issuance of Shares shall confer no retroactive right to
dividends.
14. Rights to Terminate.
Nothing in the Plan or in any agreement entered into pursuant to the Plan
shall confer upon any person the right to continue in the employment of the
Company or to serve as a director, or affect any right which the Company may
have to terminate the employment or directorship of such person.
15. Withholding.
(a) Prior to the issuance or transfer of Shares under the Plan, the
recipient shall remit to the Company an amount sufficient to
satisfy any federal, state or local withholding tax requirements.
The recipient may satisfy the withholding requirement in whole or
in part by electing to have the Company withhold Shares having a
value equal to the amount required to be withheld. The value of
the Shares to be withheld shall be the fair market value, as
determined by the Committee, of the stock on the date that the
amount of tax to be withheld is determined (the "Tax Date"). Such
election must be made prior to the Tax Date, must comply with all
applicable securities law and other legal requirements, as
interpreted by the Committee, and may not be made unless approved
by the Committee, in its discretion.
14
(b) Whenever payments to a grantee in respect of an award under the
Plan to be made in cash, such payments shall be net of the amount
necessary to satisfy any federal, state or local withholding tax
requirements.
16. Non-Assignability.
No award under the Plan shall be sold, assigned, transferred, exchanged,
pledged, hypothecated, or otherwise encumbered, other than by will or by the
laws of descent and distribution, or by such other means as the Committee may
approve. Except as otherwise provided herein, during the life of the recipient,
such award shall be exercisable only by such person or by such person's guardian
or legal representative.
17. Non-Uniform Determinations.
The Committee's determinations under the Plan (including without limitation
determinations of the persons to receive awards, the form, amount and timing of
such awards, the terms and provisions of such awards and the agreements
evidencing same, and the establishment of values and performance targets) need
not be uniform and may be made selectively among persons who receive, or are
eligible to receive, awards under the Plan, whether or not such persons are
similarly situated.
18. Change In Control Provisions.
(a) In the event of (1) a Change in Control (as defined) or (2) a Potential
Change in Control (as defined), but only if and to the extent so determined by
the Board of Directors at or after grant (subject to any right of approval
expressly reserved by the Board of Directors at the time of such determination),
the following acceleration and valuation provisions shall apply:
(i) Any SARs outstanding for at least six months and any stock
options awarded under the Plan not previously exercisable and
vested shall become fully exercisable and vested.
(ii) Any restrictions and deferral limitations applicable to any
restricted stock, performance units or other Stock-based awards,
in each case to the extent not already vested under the Plan,
shall lapse and such shares, performance units or other
stock-based awards shall be deemed fully vested.
(iii)The value of all outstanding stock options, SARs, restricted
stock, performance units and other stock-based awards, in each
case to the extent vested, shall, unless otherwise determined by
the Committee in its sole discretion at or after grant but prior
to any Change in Control, be cashed out on the basis of the
Change in Control Price (as defined) as of the date such Change
in Control or such Potential Change in Control is determined to
have occurred or such other date as the Committee may determine
prior to the Change in Control.
(b) As used herein, the term "Change in Control" means the happening of any
of the following:
(i) Any person or entity, including a "group" as defined in Section
13(d)(3) of the 1934 Act, other than the Company, a subsidiary of
the Company, or any employee benefit plan of the Company or its
subsidiaries, becomes the beneficial owner of the Company's
securities having 20 percent or more of the combined voting power
of the then outstanding securities of the Company that may be
cast for the election for directors of the Company (other than as
a result of an issuance of securities initiated by the Company in
the ordinary course of business), or
15
(ii) As the result of, or in connection with, any cash tender or
exchange offer, merger or other business combination, sale of
assets or contested election, or any combination of the foregoing
transactions, less than a majority of the combined voting power
of the then outstanding securities of the Company or any
successor corporation or entity entitled to vote generally in the
election of directors of the Company or such other corporation or
entity after such transaction, are held in the aggregate by
holders of the Company's securities entitled to vote generally in
the election of directors of the Company immediately prior to
such transactions; or
(iii)During any period of two consecutive years, individuals who at
the beginning of any such period constitute the Board of
Directors cease for any reason to constitute at least a majority
thereof, unless the election, or the nomination for election by
the Company's stockholders, of each director of the Company first
elected during such period was approved by a vote of at least
two-thirds of the directors of the Company then still in office
who were directors of the Company at the beginning of any such
period.
(c) As used herein, the term "Potential Change in Control" means the
happening of any of the following:
(i) The approval by stockholders of an agreement by the Company, the
consummation of which would result in a Change in Control of the
Company; or
(ii) The acquisition of beneficial ownership, directly or indirectly,
by any entity, person or group (other than the Company, a
wholly-owned subsidiary thereof or any employee benefit plan of
the Company or its subsidiaries (including any trustee of such
plan acting as such trustee)) of securities of the Company
representing 10 percent or more of the combined voting power of
the Company's outstanding securities and the adoption by the
Board of Directors of a resolution to the effect that a Potential
Change in Control of the Company has occurred for purposes of
this Plan.
(d) As used herein, the term "Change in Control Price" means the highest
price per share paid in any transaction reported on the National Association of
Securities Dealers Automated Quotation System, or paid or offered in any
bonafide transaction related to a Potential or actual Change in Control of the
Company at any time during the 60 day period immediately preceding the
occurrence of the Change in Control (or, where applicable, the occurrence of the
Potential Change in Control event), in each case determined by the Committee
except that, in the case of Incentive Stock Options and SARs relating to
Incentive Stock Options, such price shall be based only on transactions reported
for the date on which the optionee exercises such SARs or, where applicable, the
date on which a cash out occurs under Section 18(a)(iii).
19. Non-Competition Provision.
Unless the award agreement relating to a stock option, SAR, restricted
stock or performance unit specifies otherwise, a grantee shall forfeit all
unexercised, unearned and/or unpaid awards, including, but not by way of
limitation, awards earned but not yet paid, all unpaid dividends and dividend
equivalents, and all interest, if any, accrued on the foregoing, if the grantee,
without the written consent of the Company, engages directly or indirectly in
any manner or capacity as principal, agent, partner, officer, director, employee
or otherwise, in any business or activity which is, in the opinion of the
Committee, (i) competitive with the business conducted by the Company or any of
its subsidiaries, or (ii) inimical to the best interests of the Company or any
of its subsidiaries.
20. Adjustments.
In the event of any change in the outstanding common stock of the Company,
by reason of a stock dividend or distribution, recapitalization, merger,
consolidation, reorganization, split-up, combination, exchange or Shares or the
like, the Board of Directors, in its discretion, may adjust proportionately the
16
number of Shares which may be issued under the Plan, the number of Shares
subject to outstanding awards, and the option exercise price of each outstanding
option, and may make such other changes in outstanding options, SARs,
performance units and restricted stock awards, as it deems equitable in its
absolute discretion to prevent dilution or enlargement of the rights of
grantees, provided that any fractional Shares resulting from such adjustments
shall be eliminated.
21. Amendment.
The Board of Directors may terminate, amend, modify or suspend the Plan at
any time, except that the Board shall not, without the authorization of the
holders of a majority of Company's voting securities, increase the maximum
number of Shares which may be issued under the Plan (other than increases
pursuant to paragraph 20 hereof), extend the last date on which awards may be
granted under the Plan, extend the date on which the Plan expires, change the
class of persons eligible to receive awards, or change the minimum option price.
In no event, however, shall the provisions of paragraph 6(h) be amended more
often than once every six months, other than to comport with changes in the
Code, the Employment Retirement Income Security Act of 1974, as amended, or the
rules thereunder. No termination, modification, amendment or suspension of the
Plan shall adversely affect the rights of any grantee or Beneficiary under an
award previously granted, unless the grantee or Beneficiary shall consent; but
it shall be conclusively presumed that any adjustment pursuant to paragraph 20
hereof does not adversely affect any such right.
22. Effect on Other Plans.
Participation in this Plan shall not affect a grantee's eligibility to
participate in any other benefit or incentive plan of the Company. Any awards
made pursuant to this Plan shall not be used in determining the benefits
provided under any other plan of the Company unless specifically provided
therein.
23. Effective Date and Duration of the Plan.
The Plan shall become effective when adopted by the Board of Directors,
provided that the Plan is approved by the holders of a majority of the Company's
voting securities on the date of its adoption by the Board or before the first
anniversary of that date. Unless it is sooner terminated in accordance with
paragraph 21 hereof, the Plan shall remain in effect until all awards under the
Plan have been satisfied by the issuance of Shares or payment of cash or have
expired or otherwise terminated, but no award shall be granted more than ten
years after the earlier of the date the Plan is adopted by the Board of
Directors or is approved by the holders of the Company's voting securities.
24. Unfunded Plan.
The Plan shall be unfunded, except to the extent otherwise provided in
accordance with Section 8 hereof. Neither the Company nor any affiliate shall be
required to segregate any assets that may be represented by stock options, SARs,
or performance units, and neither the Company nor any affiliate shall be deemed
to be a trustee of any amounts to be paid under any stock option, SAR or
performance unit. Any liability of the Company or any affiliate to pay any
grantee or Beneficiary with respect to an option, SAR or performance unit shall
be based solely upon any contractual obligations created pursuant to the
provisions of the Plan; no such obligations will be deemed to be secured by a
pledge or encumbrance on any property of the Company or an affiliate.
17
25. Governing Law.
The Plan shall be construed and its provisions enforced and administered in
accordance with the laws of the State of Tennessee except to the extent that
such laws may be superseded by any federal law.
ADOPTED BY THE BOARD OF DIRECTORS OF CATHERINES STORES CORPORATION ON THE
THIRTIETH DAY OF MARCH, 1994, AND AMENDED BY THE SHAREHOLDERS ON JUNE 2, 1999.
By: /s/ Bernard J. Wein
----------------------
Bernard J. Wein, Chairman of the Board of Directors,
President and
Chief Executive Officer
18
NONQUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO THE CATHERINES STORES CORPORATION
1994 OMNIBUS INCENTIVE PLAN
CATHERINES STORES CORPORATION, a Delaware corporation (the "Company"),
hereby grants to v1 (the "Optionee") an option ("Option") to purchase a total of
v2 shares of $.01 par value common stock of the Company (the "Shares"), at the
price determined as provided herein, and in all respects subject to the terms,
definitions and provisions of the 1994 OMNIBUS INCENTIVE PLAN (the "Plan")
adopted by the Company which is incorporated herein by reference.
1. Nature of the Option. This Option is not intended to be an "incentive
stock option" within the meaning of section 422 of the Internal Revenue Code of
1986, as amended.
2. Option Price. The option price is $v3 for each Share.
3. Exercise of Option. This Option shall be exercisable only in accordance
with the provisions of the Plan, and only by written notice which shall:
(a) state the election to exercise the Option, the number of Shares
in respect of which it is being exercised, the person in whose
name the stock certificate or certificates for such Shares is to
be registered, his or her address and Social Security Number (or
if more than one, the names, addresses and Social Security
Numbers of such persons);
(b) contain such representations and agreements as to the holder's
investment intent with respect to such Shares as may be required
by the Company pursuant to the Plan or this Agreement;
(c) be signed by the person or persons entitled to exercise the
Option, and if the Option is being exercised by any person or
persons other than the Optionee, be accompanied by proof,
satisfactory to the Company, of the right of such person or
persons to exercise the Option;
(d) be in writing and delivered in person or by certified mail to the
Secretary of the Company; and
(e) be accompanied by payment in full (including applicable
withholding taxes, if any, as described in Section 8 of this
Agreement). Payment of the purchase price shall be in cash,
currency, by certified or bank cashier's check and/or Shares, or
a combination thereof pursuant to the provisions of the Plan.
Unless the sale of Shares pursuant to this Option has been registered under the
Securities Act of 1933 on Form S-8 or successor form, the certificate or
certificates for Shares as to which the Option shall be exercised shall contain
the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND HAVE BEEN
ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO
THE DISTRIBUTION THEREOF, AND SUCH SECURITIES MAY NOT BE SOLD
OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS REGISTERED
UNDER SUCH ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL
FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO THE COMPANY
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE ACT, AND UNLESS SUCH SALE OR
TRANSFER IS AUTHORIZED UNDER APPLICABLE STATE LAW."
19
4. Extent of Exercise. This Option shall be exercisable at any time in such
amounts and at such times as are set forth below:
(a) Exercisable to the extent of 25% of the Shares covered hereby on
or after the first anniversary of the date of grant set forth
below ("Date of Grant"); exercisable to the extent of an
additional 25% of the Shares covered hereby on or after the
second anniversary of the Date of Grant; exercisable to the
extent of an additional 25% of the Shares covered hereby on or
after the third anniversary of the Date of Grant; and exercisable
to the extent of the remaining 25% of the Shares covered hereby
on or after the fourth anniversary of the Date of Grant.
(b) Notwithstanding paragraph 4(a) hereof, the entire unexercised
portion of this Option shall be exercisable on or after the date
of Optionee's Retirement (as defined in the Plan).
(c) Notwithstanding paragraphs 4(a) and 4(b) hereof, no portion of
this Option shall be exercisable any earlier than the date the
Plan is approved by the stockholders of the Company.
5. Restrictions on Exercise. This Option may not be exercised if the
issuance of such Shares upon such exercise would constitute a violation of any
applicable federal or state securities laws or other law or regulation. As a
condition to the exercise of this Option, the Company may require the Optionee
to make any representation and warranty to the Company as may be required by any
applicable law or regulation or may otherwise be appropriate.
6. Nontransferability of Option. This Option may not be sold, assigned,
transferred, exchanged, pledged, hypothecated, or otherwise encumbered, other
than by will or by the laws of descent and distribution. During the lifetime of
the Optionee this Option is exercisable only by the Optionee. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
7. Term of Option. This Option may not be exercised more than ten (10)
years from the date of grant of this Option and may be exercised during such
term only in accordance with the Plan and the terms of this Agreement.
8. Withholding. Prior to the issuance of Shares under this Option, the
Optionee shall remit to the Company an amount sufficient to satisfy any federal,
state or local withholding tax requirements. The Optionee may satisfy the
withholding requirement in whole or in part by electing to have the Company
withhold Shares having a value equal to the amount required to be withheld. The
value of the Shares to be withheld shall be the fair market value, as determined
by the Committee, of the stock on the date that the amount of tax to be withheld
is determined (the "Tax Date"). Such election must be made prior to the Tax
Date, must comply with all applicable securities law and other legal
requirements, as interpreted by the Committee, and may not be made unless
approved in advance by the Committee, in its discretion. The Company reserves
the right to make whatever further arrangements it deems appropriate for the
withholding of any taxes in connection with any transaction contemplated by this
Agreement or the Plan.
9. Merger. This Agreement supersedes any other agreement, written or oral,
between the parties with respect to the subject matter hereof.
20
10. Optionee Acknowledgement. Optionee acknowledges receipt of a copy of
the Plan, which is annexed hereto, and represents that he or she is familiar
with the terms and provisions thereof, and hereby accepts this Option subject to
all the terms and provisions thereof. Optionee hereby agrees to accept as
binding, conclusive and final decisions or interpretations of the Committee upon
any questions arising under the Plan.
DATE OF GRANT:
CATHERINES STORES CORPORATION
By:
---------------------------
Its:
---------------------------
Agreed to and accepted this _ day of _________, 19__.
21
INCENTIVE STOCK OPTION AGREEMENT
PURSUANT TO THE CATHERINES STORES CORPORATION
1994 OMNIBUS INCENTIVE PLAN
CATHERINES STORES CORPORATION, a Delaware corporation (the "Company"),
hereby grants to v1 (the "Optionee") an option ("Option") to purchase a total of
v2 shares of $.01 par value common stock of the Company (the "Shares"), at the
price determined as provided herein, and in all respects subject to the terms,
definitions and provisions of the 1994 OMNIBUS INCENTIVE PLAN (the "Plan")
adopted by the Company which is incorporated herein by reference.
1. Nature of the Option. This Option is intended to be an "incentive stock
option" within the meaning of section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
2. Option Price. Except as otherwise provided in Section 8, the option
price is $v3 for each Share, which is the fair market value of the Shares on the
date of grant set forth below ("Date of Grant"), as determined by the Committee.
3. Exercise of Option. This Option shall be exercisable only in accordance
with the provisions of the Plan, and only by written notice which shall:
(a) state the election to exercise the Option, the number of Shares
in respect of which it is being exercised, the person in whose
name the stock certificate or certificates for such Shares is to
be registered, his or her address and Social Security Number (or
if more than one, the names, addresses and Social Security
Numbers of such persons);
(b) contain such representations and agreements as to the holder's
investment intent with respect to such Shares as may be required
by the Company pursuant to the Plan or this Agreement;
(c) be signed by the person or persons entitled to exercise the
Option, and if the Option is being exercised by any person or
persons other than the Optionee, be accompanied by proof,
satisfactory to the Company, of the right of such person or
persons to exercise the Option;
(d) be in writing and delivered in person or by certified mail to the
Secretary of the Company; and
(e) be accompanied by payment in full (including applicable
withholding taxes, if any, as described in Section 8 of this
Agreement). Payment of the purchase price shall be in cash,
currency, by certified or bank cashier's check and/or Shares, or
a combination thereof pursuant to the provisions of the Plan.
Unless the sale of Shares pursuant to this Option has been registered under the
Securities Act of 1933 on Form S-8 or successor form, the certificate or
certificates for Shares as to which the Option shall be exercised shall contain
the following legend:
22
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND HAVE BEEN
ACQUIRED FOR INVESTMENT PURPOSES ONLY AND NOT WITH A VIEW TO
THE DISTRIBUTION THEREOF, AND SUCH SECURITIES MAY NOT BE SOLD
OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS REGISTERED
UNDER SUCH ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL
FOR THE HOLDER OF THESE SECURITIES SATISFACTORY TO THE COMPANY
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE ACT, AND UNLESS SUCH SALE OR
TRANSFER IS AUTHORIZED UNDER APPLICABLE STATE LAW."
4. Extent of Exercise. This Option shall be exercisable at any time in such
amounts and at such times as are set forth below:
(a) Exercisable to the extent of 25% of the Shares covered hereby on
or after the first anniversary of the date of grant set forth
below ("Date of Grant"); exercisable to the extent of an
additional 25% of the Shares covered hereby on or after the
second anniversary of the Date of Grant; exercisable to the
extent of an additional 25% of the Shares covered hereby on or
after the third anniversary of the Date of Grant; and exercisable
to the extent of the remaining 25% of the Shares covered hereby
on or after the fourth anniversary of the Date of Grant.
(b) Notwithstanding paragraph 4(a) hereof, the entire unexercised
portion of this Option shall be exercisable on or after the date
of Optionee's Retirement (as defined in the Plan).
(c) Notwithstanding paragraphs 4(a) and 4(b) hereof, (i) the
aggregate fair market value (determined as of the Date of Grant)
of the Shares with respect to which this Option are exercisable
for the first time by the Optionee in any calendar year (under
all plans of the Company and its subsidiary corporations (which
term, as used hereinafter, shall have the meaning ascribed
thereto in section 425(f) of the Code )) shall not exceed
$100,000; and (ii) no portion of this Option shall be exercisable
any earlier than the date the Plan is approved by the
stockholders of the Company.
5. Restrictions on Exercise. This Option may not be exercised if the
issuance of such Shares upon such exercise would constitute a violation of any
applicable federal or state securities laws or other law or regulation. As a
condition to the exercise of this Option, the Company may require the Optionee
to make any representation and warranty to the Company as may be required by any
applicable law or regulation or may otherwise be appropriate.
6. Nontransferability of Option. This Option may not be sold, assigned,
transferred, exchanged, pledged, hypothecated, or otherwise encumbered, other
than by will or by the laws of descent and distribution. During the lifetime of
the Optionee this Option is exercisable only by the Optionee. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.
7. Term of Option. Except as provided in Section 8, this Option may not be
exercised more than ten (10) years from the date of grant of this Option and may
be exercised during such term only in accordance with the Plan and the terms of
this Agreement.
8. Ten Percent Shareholders. If the Optionee owns at the Date of Grant
stock possessing more than 10 percent of the total combined voting power of all
classes of stock of the Company or of a subsidiary corporation of the Company,
then notwithstanding anything herein to the contrary, the option price shall be
110 percent of the fair market value (as determined by the Committee) of the
stock subject to this Option at the Date of Grant and this Option shall not be
exercisable after the expiration of five years from the Date of Grant.
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9. Withholding. Prior to the issuance of Shares under this Option, the
Optionee shall remit to the Company an amount sufficient to satisfy any federal,
state or local withholding tax requirements. The Optionee may satisfy the
withholding requirement in whole or in part by electing to have the Company
withhold Shares having a value equal to the amount required to be withheld. The
value of the Shares to be withheld shall be the fair market value, as determined
by the Committee, of the stock on the date that the amount of tax to be withheld
is determined (the "Tax Date"). Such election must be made prior to the Tax
Date, must comply with all applicable securities law and other legal
requirements, as interpreted by the Committee, and may not be made unless
approved in advance by the Committee, in its discretion. The Company reserves
the right to make whatever further arrangements it deems appropriate for the
withholding of any taxes in connection with any transaction contemplated by this
Agreement or the Plan.
10. Merger. This Agreement supersedes any other agreement, written or oral,
between the parties with respect to the subject matter hereof.
11. Optionee Acknowledgement. Optionee acknowledges receipt of a copy of
the Plan, which is annexed hereto, and represents that he or she is familiar
with the terms and provisions thereof, and hereby accepts this Option subject to
all the terms and provisions thereof. Optionee hereby agrees to accept as
binding, conclusive and final decisions or interpretations of the Committee upon
any questions arising under the Plan.
DATE OF GRANT:
CATHERINES STORES CORPORATION
By:
---------------------------
Its:
---------------------------
Agreed to and accepted this ___ day of _________, 19__.
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