As filed with the Securities and Exchange Commission on December 27, 2001.
File No. ________________
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
CTI INDUSTRIES CORPORATION
(Exact name of registrant as specified in its charter)
Illinois 36-2848943
(State or other jurisdiction (IRS Employer Identification Number)
of incorporation)
22160 North Pepper Road
Barrington, Illinois 60010
(847) 382-1000
(Address, including zip code, and telephone number,
including area code of registrant's principal executive offices)
CTI INDUSTRIES CORPORATION 1999 STOCK OPTION PLAN
(Full title of the Plan)
Howard W. Schwan Copies of Communications to:
President
CTI Industries Corporation Stephen M. Merrick, Esq.
22160 North Pepper Road Scott P. Slykas, Esq.
Barrington, Illinois 60010 Merrick & Klimek, P.C.
Phone: (847) 382-1000 401 South LaSalle Street, Suite 1302
Fax: (847) 382-1219 Chicago, IL 60605
(Name, address, including zip code, Phone: (312) 294-6044
and telephone number, including Fax: (312) 294-6045
area code, of agent for service)
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of Amount Maximum Maximum Amount of
Securities to be to be Offering Price Aggregate Registration
Registered Registered(1) Per Share(1) (2) Offering Price(1) (3) Fee(1) (3)
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Common Stock
no par value 133,333 $2.475 $302,133 $75.53
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(1) Represents the maximum number of shares of Common Stock to be issued by the
Company upon the exercise of options granted under the CTI Industries
Corporation 1999 Stock Option Plan. In addition, pursuant to Rule 416(c)
under the Securities Act of 1933, this Registration Statement also covers
an indeterminate amount of interests to be offered or sold pursuant to the
CTI Industries Corporation 1999 Stock Option Plan described herein.
(Footnotes continued on next page)
(2) Represents the range of prices at which options issued under the 1999 Stock
Option Plan may be exercised to acquire shares of the Company's Common
Stock, $2.25 being the Minimum exercise price for options currently issued
under the 1999 Stock Option Plan, and $2.475 being the Maximum exercise
price for options currently issued under the 1999 Stock Option Plan. A
total of 8,833 shares being registered under this Registration Statement
are subject to issuance at prices that are currently undeterminable;
consequently, $3.53 of the total registration fee being paid hereunder has
been estimated/determined pursuant to Rule 457(h), and is based on the
closing price of the Company's Common Stock on the NASDAQ SmallCap Market
on December 24, 2001.
(3) Represents the Maximum aggregate offering price for shares of Common Stock
subject to issuance under the Plan, calculated as follows: 84,500 options
to purchase 1 share of Common Stock at an exercise price of $2.25 per
share; 40,000 options to purchase 1 share of Common Stock at an exercise
price of $2.475, and 8,833 options to purchase 1 share of Common Stock at
an exercise price (or prices) to be determined at a future date, $3.53
of the total registration fee for the shares underlying said options being
calculated (estimated) hereunder pursuant to Rule 457(h), and which figure
is based upon the closing price of the Company's Common Stock on the NASDAQ
SmallCap Market on December 24, 2001.
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PART I
Pursuant to Part I of Form S-8, information required under Items 1 and 2 of
Form S-8 is omitted as part of this Registration Statement,
PART II
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Securities and Exchange Commission
are hereby incorporated by reference:
(a) The Annual Report of the Company on Form 10-KSB for the fiscal year
ended December 31, 2000;
(b) The Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended March 31, 2001;
(c) The Definitive Proxy Statement of the Company dated May 14, 2001 for
the Annual Meeting of Shareholders to be held on June 29, 2001;
(d) The Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended June 30, 2001;
(e) The Quarterly Report of the Company on Form 10-QSB for the fiscal
quarter ended September 30, 2001;
(f) The description of the Company's capital stock as set forth in the
Company's Form SB-2 Registration Statement (File No. 333-31969),
declared effective November 5, 1997, 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 and 15(d) of the Securities Exchange Act of 1934 prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
a part hereof from the date of filing such documents.
Item 4. Description of Securities.
Not applicable.
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Item 5. Interests of Named Experts and Counsel.
The validity of the shares of Common Stock offered hereby will be passed
upon for the Registrant by Merrick & Klimek, P.C., Chicago, Illinois. Stephen M.
Merrick, a shareholder of that firm is a shareholder, Executive Vice-President
and Secretary of the Registrant.
Item 6. Indemnification of Directors and Officers.
Section 8.75 of the Illinois Business Corporation Act confers broad powers
upon corporations incorporated in that State with respect to indemnification of
any person against liabilities incurred by reason of the fact that he is or was
a director, officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation or other business entity. The provisions of Section 8.75 are
not exclusive of any other rights to which those seeking indemnification may be
entitled under bylaw, agreement or otherwise.
Article IX of the registrant's By-Laws provides that the registrant shall
have the power to indemnify any person who was or is party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of the registrant) by reason of the fact that he or
she is or was a director, officer, employee or agent of the registrant, or who
is or was serving at the request of the registrant as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if such person acted in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interests of the registrant, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
Article IX also provides that the registrant shall have power to indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that such
person is or was a director, officer, employee or agent of the registrant, or is
or was serving at the request of the registrant as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection with the defense or settlement of such
action or suit if such person acted in good faith and in a manner he or she
reasonably believed to be in, or not opposed to the best interests of the
registrant, provided that no indemnification shall be made in respect of any
claim, issue or matter as to which such persons shall have been adjudged to be
liable for negligence or misconduct in the performance of his or her duty to the
registrant, unless, and only to the extent that the court in which such action
or suit was brought shall determine upon application that,
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despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnify for such
expenses as the court shall deem proper.
To the extent that a director, officer, employee, or agent of the
registrant has been successful, on the merits or otherwise, in defense of any
action, suit or proceeding referred to above, or in defense of any claim, issue
or matter therein, such person shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in connection
therewith.
Any indemnification under Article IX (unless ordered by court) shall be
made by the registrant only as authorized in the specific case, upon
determination that indemnification of a director, officer, employee or agent is
proper in the circumstances because he or she has met the applicable standard of
conduct set forth above. Such determination shall be made:
(a) by the board of directors by a majority of a quorum consisting of
directors who were not parties to such action, suit or proceeding, or
(b) if such a quorum is not obtainable, or, even if obtainable, a quorum
of disinterested directors so directs, by independent legal counsel in
a written opinion, or
(c) by the shareholders.
Expenses incurred in defending a civil or criminal action, suit or
proceeding may be paid by the registrant in advance of the final disposition of
such action, suit or proceeding, as authorized by the board of directors in the
specific case, upon receipt of an undertaking by or on behalf of the director,
officer, employee or agent to repay such amount, unless it shall ultimately be
determined that he or she is entitled to be indemnified by the registrant as
authorized in Article IX.
The indemnification provided by Article IX is not exclusive of any other
rights to which those indemnified may be entitled under any contract, agreement,
vote of shareholders or disinterested directors, or otherwise, both as to action
in his or her official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
Article IX provides that the registrant shall have power to purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the registrant, or is or was serving at the request of the
registrant, as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against any liability
asserted against such person and incurred by such person in any such capacity,
or arising out of his status as such, whether or not the registrant
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would have the power to indemnify him or her against such liability under the
provisions of this Article. The registrant has not obtained such insurance to
date.
If a registrant has paid indemnity or has advanced expenses to a director,
officer, employee or agent, the registrant shall report the indemnification or
advance in writing to the shareholders with or before the notice of the next
shareholders meeting.
Section 2.10(b)(3) of the Illinois Business Corporation Act enables a
corporation to eliminate or limit the personal liability of a director to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, provided that such provision does not eliminate or limit the
liability of a director (i) for any breach of the director's duty of loyalty to
the corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) pursuant to Section 8.65 of the Illinois Business Act (regarding unlawful
dividends, stock purchases or stock redemptions) or (iv) for any other
transaction for which a director derived an improper personal benefit. The
Articles of Incorporation of the Company contain such a provision.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit
4 CTI Industries Corporation 1999 Stock Option Plan.
5. Opinion of Merrick & Klimek, P.C. re: legality.
23.1 Consent of Grant Thornton, L.L.P., independent auditors of CTI
Industries Corporation.
23.2 Consent of Merrick & Klimek, P.C. (included in Exhibit 5 Opinion
Letter).
24 Power of Attorney (included on signature page).
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
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statement to include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(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 the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and if, 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 connected 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
The Registrant. 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 Barrington, State of Illinois, on December 27,
2001.
CTI INDUSTRIES CORPORATION
By: /s/ Howard W. Schwan
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Howard W. Schwan, President
THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the Committee
which administers the CTI Industries Corporation 1999 Stock Option Plan has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Barrington, State of
Illinois on December 27, 2001.
PLAN:
CTI INDUSTRIES CORPORATION
1999 STOCK OPTION PLAN
By: /s/ Howard W. Schwan,
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Howard W. Schwan, Member of the
Compensation Committee
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POWER OF ATTORNEY
The undersigned officers and directors of CTI Industries Corporation hereby
constitute and appoint Howard W. Schwan and Stephen M. Merrick, or either of
them, with power to act one without the other, our true and lawful
attorney-in-fact and agent with full power of substitution and resubstitution,
for us and in our stead, in any and all capacities to sign any and all
amendments (including post-effective amendments) to this Registration Statement
and all documents relating thereto, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorney-in-fact and agent, full power
and authority to do and perform each and every act and thing necessary or
advisable to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his or her substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signatures Title Date
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/s/ Howard W. Schwan President and Director 12/27/01
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Howard W. Schwan
/s/ John H. Schwan Chairman and Director 12/27/01
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John H. Schwan
/s/ Stephen M. Merrick Senior Vice President 12/27/01
------------------------------- Secretary, Chief Financial
Stephen M. Merrick Officer and Director
/s/ Stanley M. Brown Director 12/27/01
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Stanley M. Brown
/s/ Bret Tayne Director 12/27/01
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Bret Tayne
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