Registration No. 333-_____________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
__________________________________
HUDSON HIGHLAND GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 59-3547281
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
622 Third Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
Hudson Highland Group, Inc. Employee Stock Purchase Plan
(Full title of the plan)
__________________________________
Latham Williams Copy to:
Vice President, Legal Affairs and Administration,
Corporate Secretary Benjamin F. Garmer, III
Hudson Highland Group, Inc. Foley & Lardner
225 West Wacker Drive, Suite 2100 777 East Wisconsin Avenue
Chicago, Illinois 60606 Milwaukee, Wisconsin 53202
(312) 795-4216 (414) 271-2400
(Name, address and telephone number,
including area code, of agent for service)
__________________________________
CALCULATION OF REGISTRATION FEE
- ------------------------ ----------------------- ---------------------- ---------------------- -------------------
Title of Amount Proposed Maximum Proposed Maximum
Securities to be to be Offering Price Aggregate Offering Amount of
Registered Registered (1) Per Share Price Registration Fee
- ------------------------ ----------------------- ---------------------- ---------------------- -------------------
Common Stock, 160,000 shares $8.60 (2) $1,376,000 (2) $111.32
$.001 par value
- ------------------------ ----------------------- ---------------------- ---------------------- -------------------
(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 that may become issuable as a result of stock splits, stock dividends
or similar transactions pursuant to the anti-dilution provisions of the
Hudson Highland Group, Inc. Employee Stock Purchase Plan.
(2) Estimated pursuant to Rule 457(c) and (h) under the Securities Act of 1933
solely for the purpose of calculating the registration fee based on the
average of the high and low prices for Hudson Highland Group, Inc. Common
Stock on The Nasdaq National Market on March 25, 2003.
___________________________
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document or documents containing the information specified in Part I
are not required to be filed with the Securities and Exchange Commission (the
"Commission") as part of this Registration Statement on Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
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The following documents filed with the Commission by Hudson Highland Group,
Inc. (the "Company") are hereby incorporated herein by reference:
1. The Company's Registration Statement on Form 10 (File No. 0-50129), as
filed with the Commission on March 14, 2003 and declared effective by the
Commission on March 17, 2003 (the "Form 10").
2. The description of the Company's common stock contained in the Company's
Form 10, including any amendment or report filed for the purpose of updating
such description.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, after the
date of filing of this Registration Statement and prior to such time as the
Company files 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 a part hereof from the date
of filing of such documents.
Item 4. Description of Securities.
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Not applicable.
Item 5. Interests of Named Experts and Counsel.
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None.
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Under the provisions of Section 145 of the Delaware General Corporation
Law, the Company is required to indemnify any present or former officer or
director against expenses arising out of legal proceedings in which the director
or officer becomes involved by reason of being a director or officer if the
director or officer is successful in the defense of such proceedings. Section
145 also provides that the Company may indemnify a director or officer in
connection with a proceeding in which he is not successful in defending if it is
determined that he acted in good faith and in a manner
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reasonably believed to be in or not opposed to the best interests of the Company
or, in the case of a criminal action, if it is determined that he had no
reasonable cause to believe his conduct was unlawful. Liabilities for which a
director or officer may be indemnified include amounts paid in satisfaction of
settlements, judgments, fines and other expenses (including attorneys' fees
incurred in connection with such proceedings). In a stockholder derivative
action, no indemnification may be paid in respect of any claim, issue or matter
as to which the director or officer has been adjudged to be liable to the
Company (except for expenses allowed by a court).
Article XIII of the Company's Amended and Restated Certificate of
Incorporation provides for indemnification of directors and officers of the
Company to the full extent permitted by applicable law. Under the provisions of
Article VII of the Company's Amended and Restated By-Laws, the Company is
required to indemnify officers or directors to a greater extent than under the
current provisions of Section 145 of the Delaware General Corporation Law.
Except with respect to stockholder derivative actions, the By-Law provisions
generally state that the director or officer will be indemnified against
expenses, amounts paid in settlement and judgments, fines, penalties and/or
other amounts incurred with respect to any threatened, pending or completed
proceeding, provided that (i) 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 (ii) with respect to any criminal action or proceeding, such
person had no reasonable cause to believe his or her conduct was unlawful.
The foregoing standards also apply with respect to the indemnification of
expenses incurred in a stockholder derivative suit. However, a director or
officer may only be indemnified for settlement amounts or judgments incurred in
a derivative suit to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper.
In accordance with the Delaware General Corporation Law, Article XII of the
Company's Amended and Restated Certificate of Incorporation contains a provision
to limit the personal liability of the directors of the Company for violations
of their fiduciary duty. This provision eliminates each director's liability to
the Company or its stockholders, for monetary damages except (i) for 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 Delaware General
Corporation Law providing for liability of directors for unlawful payment of
dividends or unlawful stock purchases or redemptions or (iv) for any transaction
from which a director derived an improper personal benefit. The effect of this
provision is to eliminate the personal liability of directors for monetary
damages for actions involving a breach of their fiduciary duty of are, including
any such actions involving gross negligence.
The Company maintains insurance policies that provide coverage to its
directors and officers against certain liabilities.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not applicable.
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Item 8. Exhibits.
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The exhibits filed herewith or incorporated herein by reference are set
forth in the attached Exhibit Index.
Item 9. Undertakings.
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(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
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
Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the
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foregoing provisions, or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
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SIGNATURES
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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 New York, State of New York, on this 1st day of
April, 2003.
HUDSON HIGHLAND GROUP, INC.
By: /s/ Jon. F. Chait
-------------------------------------
Jon F. Chait
Chairman of the Board, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Jon F. Chait Chairman of the Board, President, Chief April 1, 2003
- ------------------------------ Executive Officer and Director (Principal
Jon F. Chait Executive Officer)
/s/ Richard W. Pehlke Executive Vice President and April 1, 2003
- ------------------------------ Chief Financial Officer
Richard W. Pehlke (Principal Financial Officer)
S-1
EXHIBIT INDEX
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Exhibit
Number Exhibit Description
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(4.1) Highland Hudson Group, Inc. Employee Stock Purchase Plan.
(4.2) Amended and Restated Certificate of Incorporation of Hudson Highland
Group, Inc. (incorporated by reference to Exhibit 3.1 to Hudson
Highland Group, Inc.'s Registration Statement on Form 10 (File No.
0-50129)).
(5) Opinion of Foley & Lardner.
(23.1) Consent of BDO Seidman, LLP.
(23.2) Consent of Foley & Lardner (contained in Exhibit (5)).
E-1
Employee Stock Purchase Plan
Hudson Highland Group, Inc.
Effective April 1, 2003
Contents
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Article 1. Purpose and Effective Date 1
Article 2. Definitions 1
Article 3. Administration 4
Article 4. Number of Shares 4
Article 5. Eligibility Requirements 5
Article 6. Enrollment 5
Article 7. Grant of Options on Enrollment 6
Article 8. Payment 6
Article 9. Purchase of Shares 6
Article 10. Withdrawal from the Plan and Termination of Employment 7
Article 11. Designation of Beneficiary 8
Article 12. Miscellaneous 8
Hudson Highland Group, Inc.
Employee Stock Purchase Plan
Article 1. Purpose and Effective Date
1.1 The purpose of the Hudson Highland Group, Inc. Employee Stock Purchase
Plan (the "Plan") is to provide an opportunity for employees of Hudson Highland
Group, Inc. (the "Company") and employees of the Participating Affiliates (as
defined below) to purchase shares of common stock of the Company in a way which
is both convenient and on a basis more favorable than would otherwise be
available. The Company believes that employee participation in ownership of the
Company on this basis will be to the mutual benefit of both the employee and the
Company.
It is the intent of the Company to have the Plan qualify as an "employee
stock purchase plan" under Section 423 of the Internal Revenue Code, although
the Company makes no undertakings nor representations to maintain such
qualification. In addition, this Plan document authorizes the grant of Options
under a non-Code Section 423 plan which do not qualify under Section 423 of the
United States Internal Revenue Code pursuant to rules, procedures, or sub-plans
adopted by the Committee (as defined below) designated to achieve desired tax or
other objectives.
1.2 It is intended that Purchase Periods will commence, if at all, at such
times designated by the Committee.
1.3 The Plan shall be effective on April 1, 2003 (the "Effective Date")
subject to the approval of the Company's stockholders within one (1) year before
or one (1) year after the date the Plan is approved by the Board. The Plan shall
remain in effect in accordance with Section 12.7 of the Plan.
Article 2. Definitions
Whenever used in the Plan, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word
shall be capitalized:
2.1 "Account" means a recordkeeping account maintained for a Participant
to which payroll deductions, if applicable, shall be credited.
2.2 "Affiliate" means any (i) Subsidiary and (ii) other entity in which
the Company has an equity interest.
2.3 "Board" means the Board of Directors of the Company.
2.4 "Change in Control" shall be deemed to occur if (1) there shall be
consummated (A) any consolidation, merger or reorganization involving
the Company, unless such consolidation, merger or reorganization is a
"Non-Control Transaction" (as defined below) or (B) any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all, or substantially all, of the assets of the
Company, or (2) the stockholders of the Company shall approve any plan
or proposal for liquidation or dissolution of the Company, or (3) any
person (as such term is used in Section 13(d) and
1
14(d)(2) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")), shall become the beneficial owner (within the
meaning of Rule 13d-3 under the Exchange Act) of more than fifty
percent (50%) of the combined voting power of the Company's then
outstanding voting securities other than (a) a person who owns or
owned Shares of the Company, (b) pursuant to a plan or arrangement
entered into by such person and the Company, or (c) pursuant to
receipt of such shares from a stockholder of the Company pursuant to
such stockholder's will or the laws of descent and distribution.
A "Non-Control Transaction" shall mean a consolidation, merger or
reorganization of the Company where (1) the stockholders of the
Company immediately before such consolidation, merger or
reorganization own, directly or indirectly, at least a majority of the
combined voting power of the outstanding voting securities of the
corporation resulting from such consolidation, merger or
reorganization (the "Surviving Corporation"), (2) the individuals who
were members of the Board of the Company immediately prior to the
execution of the agreement providing for such consolidation, merger or
reorganization constitute at least fifty percent (50%) of the members
of the Board of Directors of the Surviving Corporation, or a
corporation directly or indirectly beneficially owning a majority of
the voting securities of the Surviving Corporation and (3) no person
(other than (a) the Company, (b) any subsidiary of the Company, (c)
any employee benefit plan (or any trust forming a part thereof)
maintained by the Company, the Surviving Corporation or any
subsidiary, or (d) any person who, immediately prior to such
consolidation, merger or reorganization, beneficially owned more than
fifty percent (50%) of the combined voting power of the Company's then
outstanding voting securities) beneficially owns more than fifty
percent (50%) of the combined voting power of the Surviving
Corporation's then outstanding voting securities.
2.5 "Code" means the Internal Revenue Code of 1986, as amended.
2.6 "Committee" means the compensation committee of the Board. The members
of the Committee shall be appointed from time to time by and shall
serve at the discretion of the Board.
2.7 "Company" means Hudson Highland Group, Inc., a Delaware corporation.
2.8 "Eligible Employee" means an Employee eligible to participate in the
Plan in accordance with Article 5.
2.9 "Employee" means any active employee of the Company or a Participating
Affiliate.
2.10 "Enrollment Date" means the date established by the Committee from
time to time by which enrollment forms must be received for an
Offering Period.
2.11 "Exchange Act" means the United States Securities Exchange Act of
1934, as amended.
2.12 "Fair Market Value" means, as of any applicable date, the closing sale
price on the principal securities exchange on which the Shares are
traded as reported in The Wall Street
2
Journal or, if there is no such sale on the relevant date, then on the
last previous day on which a sale was reported.
2.13 "Grant Date" means a date on which an Eligible Employee is granted an
option under the Plan pursuant to Article 7.
2.14 "Grant Price" means the Fair Market Value of a Share on the Grant Date
for such option.
2.15 "Offering Period" means the offering period designated by the
Committee.
2.16 "Participant" means an Eligible Employee who has enrolled in the Plan
pursuant to Article 6.
2.17 "Participating Affiliate" means an Affiliate which has been designated
by the Committee in accordance with Section 3.2 of the Plan as covered
by the Plan. In the event the designated Affiliate is not a
Subsidiary, it shall be designated for participation in the non-Code
Section 423 portion of the Plan.
2.18 "Purchase Date" with respect to a Purchase Period means the last
Trading Day in such Purchase Period.
2.19 "Purchase Date Price" means the Fair Market Value of a Share on the
applicable Purchase Date.
2.20 "Purchase Period" means the purchase period designated by the
Committee; provided, that each period shall, in no event, end later
than: (i) five (5) years from the date the option is granted if the
Purchase Price is to be not less than eighty-five percent (85%) of the
Fair Market Value of the Shares on the Purchase Date; or (ii)
otherwise, twenty-seven (27) months from the Grant Date.
2.21 "Purchase Period Commencement Date" means the first Trading Day of a
Purchase Period.
2.22 "Purchase Price" means the price designated by the Committee, at which
each Share may be purchased under any option, but in no event less
than eighty-five percent (85%) of the lesser of:
(a) The Grant Price, as defined in Section 2.14; and
(b) The Purchase Date Price, as defined in Section 2.18.
2.23 "Rule 16b-3" means Rule 16b-3 under the Exchange Act.
3
2.24 "Shares" means Shares of the Company's common stock.
2.25 "Subsidiary" means any corporation in an unbroken chain of
corporations beginning with the Company if, as of the applicable
Enrollment Date, each of the corporations other than the last
corporation in the chain owns stock possessing more than fifty percent
(50%) of the total combined voting power of all classes of stock in
one of the other corporations in the chain.
2.26 "Trading Day" means any day the stock exchange in which the Company's
Shares are traded is open for trading.
Article 3. Administration
3.1 The Plan shall be administered by the Committee. The members of the
Committee shall be appointed from time to time by, and shall serve at the
discretion of the Board. The Committee shall have the authority to delegate
administrative duties to officers, directors, or Employees of the Company.
3.2 The Committee shall have the power, subject to and within the limits of
the express provisions of the Plan, to construe and interpret the Plan and
options granted under it; to establish, amend, and revoke rules and regulations
for administration of the Plan; to determine all questions of policy and
expediency that may arise in the administration of the Plan; to make any changes
to the Plan or its operations to reduce or eliminate any unfavorable accounting
consequences to the extent deemed appropriate by the Committee; and, generally,
to exercise such powers and perform such acts as the Committee deems necessary
or expedient to promote the best interests of the Company, including, but not
limited to, designating from time to time which Affiliates of the Company shall
be Participating Affiliates. The Committee's determinations as to the
interpretation and operation of this Plan shall be final and conclusive.
In exercising the powers described in the foregoing paragraph, the
Committee may adopt special or different rules, procedures, or sub-plans with
respect to the Plan including, but not limited to, rules which allow employees
of any foreign Participating Affiliate to participate in, and enjoy the tax
benefits offered by the Plan.
3.3 The Plan provisions relating to the administration of the Plan may be
amended by the Board from time to time as may be desirable to satisfy any
requirements of or under the federal securities and/or other applicable laws of
the United States, or to obtain any exemption under such laws, or to reduce or
eliminate any unfavorable accounting consequences.
Article 4. Number of Shares
4.1 Shares Reserved. No more than 160,000 Shares shall be reserved for sale
and have been authorized by the stockholders of the Company for issuance
pursuant to the Plan or any other similar employee stock purchase plan that the
Company establishes for employees located in foreign jurisdictions. If any
option granted under the Plan shall for any reason terminate without having been
exercised, the Shares not purchased under such option shall again become
available for issuance under the Plan.
4
4.2 Adjustments. In the event of any change in corporate capitalization
such as a stock split, or a corporate transaction such as any merger,
consolidation, separation, including a spin-off, or other distribution of stock
or property of the Company, any reorganization (whether or not such
reorganization comes within the definition of such term in Code Section 368) or
any partial or complete liquidation of the Company, the Committee may make such
adjustments it deems appropriate to prevent dilution or enlargement of rights in
the number and class of Shares which may be delivered under Section 4.1, in the
number, class of and/or price of Shares available for purchase under the Plan,
and in the number of Shares which a Participant is entitled to purchase.
Article 5. Eligibility Requirements
5.1 Except as provided in Section 5.2, each Employee shall become eligible
to participate in the Plan in accordance with Article 6 on the first Enrollment
Date on or following the later of: (a) the date such individual becomes an
Eligible Employee; or (b) the Effective Date; provided, however, that the
Committee may establish administrative rules with respect to an Employee's
employment (e.g., some minimum employment period, for example, ninety (90) days
prior to the Offering Period) to be eligible to participate with respect to an
Offering Period. Participation in the Plan is entirely voluntary.
5.2 Any provision of this Plan to the contrary notwithstanding, no Employee
shall be granted an option, unless their participation is required as a matter
of local law or regulation:
(a) If, immediately after the grant, such Employee would own, and/or
hold outstanding options to purchase stock possessing five
percent (5%) or more of the total combined voting power or value
of all classes of stock of the Company or of any parent or
subsidiary of the Company within the meaning of Section 423 of
the Code; or
(b) Which permits the Employee's rights to purchase stock under all
employee stock purchase plans, as defined in Section 423 of the
Code, of the Company and its subsidiaries to accrue at a rate
which exceeds twenty-five thousand dollars ($25,000) of fair
market value of the stock (determined at the time such option is
granted) for each calendar year in which such stock option is
outstanding at any time;
(c) If the Employee's customary employment does not meet certain
requirements for length of employment determined by the Committee
from time to time; provided, however, that any such requirement
for length of employment shall comply with Section 423 of the
Code; or
(d) If the Employee is prohibited by the laws of the nation of their
residence of employment from participating in the Plan.
Article 6. Enrollment
Any Eligible Employee may enroll in the Plan for any future Offering Period
by completing and signing an enrollment election form or by such other means as
the Committee shall prescribe and submitting such enrollment election to the
Company or a Participating Affiliate on or before the Enrollment Date with
respect to such Offering Period.
5
Article 7. Grant of Options on Enrollment
7.1 Enrollment by an Eligible Employee in the Plan by an Enrollment Date
with respect to any Purchase Period during the applicable Offering Period will
constitute the grant by the Company to such Participant of an option on each
Purchase Period Commencement Date during such Offering Period to purchase Shares
from the Company pursuant to the Plan.
7.2 An option granted to a Participant pursuant to this Plan shall expire,
if not sooner terminated in accordance with the Plan, on the earliest to occur
of: (a) the end of the Purchase Period in which such option was granted; (b) the
completion of the purchase of Shares under the option under Article 9; or (c)
the date on which participation of such Participant in the Plan terminates for
any reason.
7.3 An option granted to a Participant under the Plan shall give the
Participant a right to purchase on a Purchase Date the number of Shares which
the funds accumulated in the Participant's Account as of such Purchase Date will
purchase at the applicable Purchase Price; provided, however, that the Committee
may, in its discretion, limit the number of Shares that may be purchased by each
Participant in any Purchase Period.
Notwithstanding anything to the contrary herein, no Employee shall be
granted an option under the Plan (or any other plan of the Company or a
Subsidiary intended to qualify under Section 423 of the Code) which would permit
the Employee to purchase Shares under the Plan (and such other plan) in any
calendar year with a Fair Market Value (determined at the time such option is
granted) in excess of USD 25,000.
Article 8. Payment
The Committee may designate the time and manner for payment for Shares to
be purchased during the Purchase Period, including, but not limited to, payment
by each Participant in cash or by certified check on a date designated by the
Committee prior to the Purchase Date, or through payroll deductions of whole
percentages of such Participant's compensation, the terms and conditions of
which are designated by the Committee.
Payment amounts shall be credited to a Participant's Account under this
Plan. Unless required to do so by law or regulation, all payment amounts may be
used by the Company for any purpose and the Company shall have no obligation to
segregate funds. Unless mandated by law or regulation, no interest shall accrue
on any payments by Participants.
Article 9. Purchase of Shares
9.1 Any option held by the Participant which was granted under this Plan
and which remains outstanding as of a Purchase Date shall be deemed to have been
exercised on such Purchase Date for the number of Shares which the funds
accumulated in the Participant's Account as of the Purchase Date will purchase
at the applicable Purchase Price (but not in excess of the number of Shares for
which options have been granted to the Participant pursuant to Section 7.3). All
other options to purchase Shares that are not purchased on the last Purchase
Date shall terminate.
9.2 If Shares are purchased by a Participant pursuant to Section 9.1, then,
within a reasonable time after the Purchase Date, the Company shall deliver or
cause to be delivered to the Participant a certificate or certificates for the
whole number of Shares purchased by the Participant unless the
6
Company has made arrangements to have the Shares held at a bank or other
appropriate institution in noncertificated form. If any law or applicable
regulation of the United States Securities and Exchange Commission or other body
having jurisdiction shall require that the Company or the Participant take any
action in connection with the Shares being purchased under the option, delivery
of the certificate or certificates for such Shares shall be postponed until the
necessary action shall have been completed.
9.3 In the case of Participants employed by a Participating Affiliate, the
Committee may provide for Shares to be sold through the Affiliate to such
Participants, to the extent consistent with Section 423 of the Code and other
applicable laws.
9.4 If the total number of Shares for which options are or could be
exercised on any Purchase Date in accordance with this Article 9, when
aggregated with all Shares for which options have been previously exercised
under this Plan, exceeds the maximum number of Shares reserved in Section 4.1,
the Company shall allocate the Shares available for delivery and distribution in
the ratio that the balance in each Participant's Account bears to the aggregate
balances of all Participants' Accounts, and the remaining balance of the amount
credited to the Participant's Account of each Participant under the Plan shall
be returned to him/her as promptly as possible.
9.5 If a Participant or former Participant sells, transfers, or otherwise
makes a disposition of Shares purchased pursuant to an option granted under the
Plan within two (2) years after the date such option is granted or within one
(1) year after the date such Shares were transferred to the Participant, and if
such Participant or former Participant is subject to United States federal
income tax, then such Participant or former Participant shall notify the Company
or Participating Affiliate in writing of such sale, transfer, or other
disposition within ten (10) days of the consummation of such sale, transfer, or
other disposition.
Article 10. Withdrawal From the Plan and Termination of Employment
10.1 Withdrawal from the Plan. A Participant may withdraw from the Plan in
full (but not in part) during any Offering Period by delivering a notice of
withdrawal to the Company or a Participating Affiliate (in a manner prescribed
by the Committee) at any time in advance of such Purchase Date as the Committee
may determine. The notice of withdrawal shall state whether the Participant
elects either to use the funds then accumulated in the Participant's Account to
purchase Shares as of the next following Purchase Date or to have the funds then
accumulated in the Participant's Account distributed to the Participant.
If notice of withdrawal is timely received and the Participant elects to
have the funds then accumulated in the Participant's Account distributed, all
funds then accumulated in the Participant's Account shall not be used to
purchase Shares as of the next following Purchase Date, but shall instead be
distributed to the Participant as soon as administratively feasible. Such a
Participant may not return the distributed funds to the Company or a
Participating Affiliate during the same Purchase Period and require the Company
or Participating Affiliate to apply those funds to the purchase of Shares.
If notice of withdrawal is timely received and the Participant elects to
use the funds then accumulated in the Participant's Account to purchase Shares
as of the next following Purchase Date, then the Participant shall continue to
have an option with respect to such funds under this Plan.
7
A Participant who has withdrawn from the Plan (whether or not the
Participant has elected to have the funds in the Participant's Account
distributed to him or her) may elect to again accumulate funds in the
Participant's Account by delivering a notice to the Company or a Participating
Affiliate (in a manner prescribed by the Committee) at any time in advance of a
Purchase Date or the end of an Offering Period as the Committee may determine;
provided, however, that such a Participant shall only be permitted to make such
an election once in an Offering Period.
10.2 Termination of Employment. Participation in the Plan terminates
immediately when a Participant ceases to be employed by the Company or a
Participating Affiliate for any reason whatsoever or otherwise ceases to be an
Eligible Employee, and such terminated Participant's outstanding options shall
thereupon terminate.
As soon as administratively feasible after termination of participation,
the Company or Participating Affiliate shall pay to the Participant or his/her
beneficiary or legal representative any amounts accumulated in the Participant's
Account at the time of termination of participation.
10.3 Change in Control. In the event of a Change in Control, the surviving,
continuing, successor, or purchasing corporation or other business entity or
parent thereof, as the case may be (the "Acquiring Corporation"), may, without
the consent of any Participant, assume the Company's rights and obligations
under the Plan. If the Acquiring Corporation elects not to assume the Company's
rights and obligations under the Plan, the Purchase Date of the then current
Purchase Period shall be accelerated to a date before the date of the Change in
Control specified by the Board, but the number of Shares subject to outstanding
options shall not be adjusted. All options which are neither assumed by the
Acquiring Corporation in connection with the Change in Control nor exercised as
of the date of the Change in Control shall terminate and cease to be outstanding
effective as of the date of the Change in Control.
10.4 Leave of Absence. If a Participant takes a leave of absence without
terminating employment, such Participant shall have the right, at the
commencement of the leave of absence and in accordance with procedures
prescribed by the Committee, to elect to withdraw from the Plan in accordance
with Section 10.1. To the extent determined by the Committee or required by
Section 423 of the Code, certain leaves of absence may be treated as cessations
of employment for purposes of the Plan.
Article 11. Designation of Beneficiary
The Committee may permit each Participant under the Plan, from time to
time, to name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom the amount in his/her Participant Account is to be paid in
case of his/her death before he/she receives any or all of such benefit. Each
such designation shall revoke all prior designations by the same Participant,
shall be in a form prescribed by the Committee, and will be effective only when
filed by the Participant in writing with the Committee during the Participant's
lifetime. In the absence of any such designation, any Participant Account
balance remaining unpaid at the Participant's death shall be paid to the
Participant's estate.
Article 12. Miscellaneous
12.1 Restrictions on Transfer. Options granted under the Plan to a
Participant may not be exercised during the Participant's lifetime other than by
the Participant. Neither amounts credited to a
8
Participant's Account nor any rights with respect to the exercise of an option
or to receive Shares under the Plan may be assigned, transferred, pledged, or
otherwise disposed of in any way by the Participant other than by will or the
laws of descent and distribution. Any such attempted assignment, transfer,
pledge, or other disposition shall be without effect, except that the Committee
may treat such act as an election to withdraw from the Plan in accordance with
Section 10.1.
12.2 Administrative Assistance. If the Committee in its discretion so
elects, it may retain a brokerage firm, bank, or other financial institution to
assist in the purchase of Shares, delivery of reports, or other administrative
aspects of the Plan. If the Committee so elects, each Participant shall (unless
prohibited by applicable law) be deemed upon enrollment in the Plan to have
authorized the establishment of an account on his/her behalf at such
institution. Shares purchased by a Participant under the Plan shall be held in
the Account.
12.3 Withholding. The Company or any Participating Affiliate shall have the
power and the right to deduct or withhold, or require a Participant to remit to
the Company or any Participating Affiliate, an amount sufficient to satisfy
federal, state, and local taxes, domestic or foreign, income or social insurance
required by law or regulation to be withheld with respect to any taxable event
arising as a result of this Plan.
12.4 Costs. All costs and expenses incurred in administering the Plan shall
be paid by the Company, except that any stamp duties, transfer taxes, and any
brokerage fees applicable to participation in the Plan may be charged to the
Participant Account of such Participant by the Company.
12.5 Equal Rights and Privileges. To the extent Eligible Employees are
granted options pursuant to Code Section 423, such Eligible Employees shall have
equal rights and privileges with respect to the Plan so that the Plan qualifies
as an "employee stock purchase plan" within the meaning of Section 423 or any
successor provision of the Code and the related regulations.
12.6 Applicable Law. The Plan shall be governed by the substantive laws
(excluding the conflict of laws rules) of the State of New York.
12.7 Amendment and Termination. The Board may amend, alter, suspend, or
terminate the Plan at any time; provided, however, that: (a) the Plan may not be
amended in a way which will cause the Plan to fail to meet the requirements of
Code Section 423; and (b) no amendment which would amend or modify the Plan in a
manner requiring stockholder approval under Section 423 of the Code, Rule 16b-3,
or the requirements of any securities exchange on which the Shares are traded
shall be effective unless such stockholder approval is obtained. In addition,
the Committee may amend the Plan as provided in Section 3.3, subject to the
conditions set forth therein and in this Section 12.7.
If the Plan is terminated or suspended, the Board or Committee may elect to
terminate all outstanding options either prior to their expiration or upon
completion of the purchase of Shares on the next Purchase Date, or may elect to
permit options to expire in accordance with their terms (and participation to
continue through such expiration dates). If the options are terminated prior to
expiration, all funds accumulated in Participants' Accounts as of the date the
options are terminated shall be returned to the Participants as soon as
administratively feasible.
9
12.8 No Right of Employment. Neither the grant nor the exercise of any
rights to purchase Shares under this Plan nor anything in this Plan shall impose
upon the Company or a Participating Affiliate any obligation to employ or
continue to employ any Employee. The right of the Company or Participating
Affiliate to terminate any Employee shall not be diminished or affected because
any rights to purchase Shares have been granted to such Employee.
12.9 Rights as Shareholder. No Participant shall have any rights as a
shareholder unless and until certificates for Shares of common stock have been
issued to him or her or to his or her account if the Company has made
arrangements to have the Shares held at a bank or other appropriate institution
in a noncertified form.
12.10 Governmental Regulation. The Company's obligation to sell and deliver
Shares of the Company's common stock under this Plan is subject to the approval
of any governmental authority required in connection with the authorization,
issuance, or sale of such Shares.
12.11 Gender. When used herein, masculine terms shall be deemed to include
the feminine, except when the context indicates to the contrary.
12.12 Condition for Participation. As a condition to participation in the
Plan, Eligible Employees agree to be bound by the terms of the Plan (including,
without limitation, the notification requirements of Section 9.6) and the
determinations of the Committee.
12.13 Employees Based Outside of the United States. Notwithstanding any
provision of the Plan to the contrary, in order to comply with the laws in other
countries in which the Company and/or its Affiliates operate or have Eligible
Employees, the Committee, in its sole discretion, shall have the power and
authority to:
(a) Determine which Affiliates shall be covered by the Plan;
(b) Modify the terms and conditions to Eligible Employees outside the
United States to comply with applicable foreign laws;
(c) Adopt rules or procedures relating to the operation and
administration of the Plan to accommodate the specific
requirements of local laws and procedures. Without limiting the
generality of the foregoing, the Committee is specifically
authorized to adopt rules and procedures regarding handling of
payroll deductions, payment of interest, conversion of local
currency, payroll tax, withholding procedures and handling of
stock certificates which vary with local legal requirements.
(d) Adopt rules, procedures or sub-plans applicable to particular
Affiliates or locations, which rules, procedures or sub-plans may
be designed to be outside the scope of Code Section 423. The
terms of such rules, procedures or sub-plans may take precedence
over other provisions of this Plan, with the exception of Article
4, but unless otherwise expressly superseded by the terms of such
rule, procedure or sub-plan, the provisions of this Plan shall
govern the operation of the Plan. To the extent inconsistent with
the requirements of Code Section 423, such rules, procedures or
sub-plans shall be considered part of the non-423 Plan, and the
options granted thereunder shall not be considered to comply with
Section 423.
10
(e) Take any action that it deems advisable to obtain approval or
comply with any necessary local government regulatory exemptions
or approvals.
Notwithstanding the above, the Committee may not take any actions
hereunder, and no option shall be granted, that would violate the Exchange Act,
the Code, any securities law, or governing statute or any other applicable law.
11
[GRAPHIC OMITTED][FOLEY & LARDNER LOGO]
FOLEY & LARDNER
777 East Wisconsin Avenue, Suite 3800
Milwaukee, Wisconsin 53202-5306
414.271.2400 TEL
414.297.4900 FAX
www.foleylardner.com
April 1, 2003
CLIENT/MATTER NUMBER
025294-0101
Highland Hudson Group, Inc.
622 Third Avenue
New York, New York 10017
Ladies and Gentlemen:
We have acted as counsel for Hudson Highland Group, Inc., a Delaware
corporation (the "Company"), in conjunction with the preparation of a
Registration Statement on Form S-8 (the "Registration Statement") to be filed by
the Company with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "Securities Act"), relating to 160,000 shares of the
Company's common stock, $.001 par value (the "Common Stock"), which may be
issued pursuant to the Hudson Highland Group, Inc. Employee Stock Purchase Plan
(the "Plan").
As such counsel, we have examined: (i) the Plan; (ii) the Registration
Statement; (iii) the Company's Restated Articles of Incorporation and By-Laws,
as amended to date; (iv) resolutions of the Company's Board of Directors
relating to the Plan and the issuance of securities thereunder; and (v) such
other documents and records as we have deemed necessary to enable us to render
this opinion.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation validly existing under the laws of the
State of Delaware.
2. The shares of Common Stock, when issued by the Company pursuant to the
terms and conditions of the Plan and as contemplated by the Registration
Statement, will be validly issued, fully paid and nonassessable and no personal
liability will attach to the ownership thereof.
We consent to the use of this opinion as an exhibit to the Registration
Statement. In giving our consent, we do not admit that we are "experts" within
the meaning of Section 11 of the Securities Act or within the category of
persons whose consent is required by Section 7 of the Securities Act.
Very truly yours,
/s/ Foley & Lardner
FOLEY & LARDNER
BRUSSELS DETROIT MILWAUKEE SAN DIEGO TAMPA
CHICAGO JACKSONVILLE ORLANDO SAN DIEGO/DEL MAR WASHINGTON, D.C.
DENVER LOS ANGELES SACRAMENTO SAN FRANCISCO WEST PALM BEACH
MADISON TALLAHASSEE
CONSENT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
Hudson Highland Group, Inc.
New York, New York
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 12, 2003, relating to the
Financial Statements of Hudson Highland Group, Inc. for the fiscal years ended
December 31, 2002, 2001 and 2000, appearing in Hudson Highland Group, Inc.'s
Form 10 filed March 14, 2003.
/s/ BDO Seidman, LLP
New York, New York
March 31, 2003