INDEX TO EXHIBITS
Exhibit Sequentially
Number Description Numbered Pages
------- -------------------------------------------------- --------------
4.1 Limited Partnership Agreement of the Registrant
dated November 7, 1985, incorporated by reference
from the Registrant's registration statement on
Form 10 filed under File No. 1-9035 and declared
effective on December 5, 1985.
4.2 Amendment to Limited Partnership Agreement dated
December 16, 1986, incorporated by reference from
the Registrant's annual report on Form 10-K for
the fiscal year ended December 31, 1987.
4.3 Amendment to Limited Partnership Agreement dated
March 14, 1997, incorporated by reference from the
Registrant's definitive proxy statement on Form
14A dated February 14, 1997 and from the
Registrant's quarterly report on Form 10-Q for the
period ended June 30, 1997.
4.4 Pope Resources 1997 Unit Option Plan Summary. 9
5.1 Opinion of Davis Wright Tremaine as to the 13
legality of securities being registered through
this Registration Statement.
24.1 Consent of Davis Wright Tremaine, contained in 13
opinion filed as Exhibit 5.1
25.1 Power of Attorney (see signature page) 9
- 8 -
Exhibit 4.4
POPE RESOURCES
1997 UNIT OPTION PLAN INFORMATION
----------
This document constitutes part of a prospectus
covering securities that have been registered
under the Securities Act of 1933
----------
GENERAL PLAN INFORMATION
Pope Resources, A Delaware Limited Partnership (the "Partnership")
established the Pope Resources 1997 Unit Option Plan (the "Plan") to attract,
motivate and retain selected officers, employees, independent contractors and
directors who provide services to the Partnership and certain related entities,
and to enable these individuals to have a proprietary interest in the success of
the Partnership. The Plan provides this incentive by granting to such
individuals options to purchase Units of the Partnership. The effective date of
the Plan was March 14, 1997. The Partnership is the Registrant. The Plan is not
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), nor to the provisions of Sections 401(a) or 422 of the Internal
Revenue Code (the "Code").
The Partnership's Managing General Partner, Pope MGP, Inc., a Delaware
corporation (the "General Partner"), represents that it intends the Plan to be a
continuing and permanent program for Participants. However, the Board of
Directors of the General Partner or a committee appointed by that Board (the
"Plan Administrator") reserves the right to terminate, modify or amend the Plan,
provided that no amendment or modification shall, without the consent of the
Participant, impair or diminish any of the Participant's rights or any
obligations of the Partnership under such option. Subject to certain limitations
described more fully in the Plan, no outstanding option may be terminated
without the consent of the Participant.
The Plan Administrator shall act as the manager of the Plan. The Plan
Administrator has the authority, in its discretion, to determine all matters
relating to the options to be granted under the Plan. The Plan Administrator has
the sole authority to interpret the provisions of the Plan, any option issued
under the Plan, and any rule or regulation applicable to the Plan. The Plan
Administrator's interpretation shall be conclusive and binding on all interested
parties.
Participants in the Plan may obtain additional information about the
Plan from Pope Resources, whose address is 19245 Tenth Avenue N.E., Poulsbo,
Washington, 98370, and whose telephone number is (360) 697-6626.
SECURITIES TO BE OFFERED
The securities available under the Plan's options are the limited
partnership units in the Partnership (the "Units"). The Units subject to options
granted under the Plan shall be Units of the Partnership presently authorized
but currently unissued, or units presently held or subsequently acquired by the
Partnership. The Units are subject to certain rights and limitations described
more fully
- 9 -
in the Limited Partnership Agreement, dated as of November 7, 1985, as currently
amended. The Limited Partnership Agreement is incorporated herein by reference,
and a copy of that Agreement is available upon request from the Partnership.
The Units are traded on the National Association of Stock Dealers
Automated Quotation System - National Market System ("NASDAQ-NMS") under the
symbol POPEZ. The total number of Units that may be issued pursuant to options
granted under the Plan is subject to the discretion of the Plan Administrator.
INDIVIDUALS WHO MAY PARTICIPATE IN THE PLAN
Options may be granted to officers and other employees of the
Partnership or its related entities, including officers, directors, employees
and affiliates of the General Partner who may also be employees of the
Partnership or a "related entity," as defined in the Plan.
Within the parameters established by the Plan, the Plan Administrator
has the sole discretion to determine the options granted under the Plan,
including the selection of individuals receiving options, the number of Units
subject to each option, the exercise price of the options, and all other terms
and conditions of the options. Grants of options under the Plan need not be
identical in any respect, even when made simultaneously.
PURCHASE OF SECURITIES OFFERED
The Plan Administrator determines the individuals who are eligible to
participate. The purchase price per Unit under each option shall be set by the
Plan Administrator. Options granted under the Plan will generally be subject to
a vesting schedule whereby the option vests ratably over a four year period,
such period beginning on the date of the grant and ending on the fourth
anniversary of the grant. If not exercised or terminated sooner (under the terms
of the Plan), each option shall expire on the date specified in the option
agreement (not later than the tenth anniversary of the date on which the option
is granted, unless specified otherwise in the individual option agreement).
Payment of the option exercise price shall be made in full at the time
the notice of exercise of the options is delivered to the Partnership, and shall
be in cash, bank-certified check, cashier's check, or personal check (unless at
the time of exercise the Plan Administrator in a particular case determines not
to accept a personal check). At the discretion of the Plan Administrator,
payment may be made through the delivery of Units held by the Optionee (for at
least six months) having a fair market value equal to the exercise price or by
the Optionee's delivery of a properly executed exercise note for a "cashless"
exercise, in accordance with applicable securities regulations.
Exercise of an option shall result in the purchase of authorized but
unissued Units, or Units now held or subsequently acquired by the Partnership.
The Partnership will not impose any fees, commissions, or additional charges on
such purchase. The Partnership will receive the entire purchase price as stated
in each option agreement.
RESALE RESTRICTIONS
Resales of Partnership Units by affiliates of the Partnership will be
subject to the limitations imposed by state and federal securities laws, as well
as the rules of any stock exchange on which the
-10 -
Partnership's securities are listed or sold. In certain situations, officers,
directors and principal Unit holders of the Partnership (and related entities)
who receive options may not, for a period of six moths following the initial
grant of the option, sell the corresponding Units.
FEDERAL INCOME TAX CONSEQUENCES
The mere grant of a Unit option will not trigger any federal taxable
income to the Optionee; correspondingly, the Partnership will not be entitled to
a tax deduction at the time of grant. When any part of a Unit option is
exercised, the Optionee will be deemed to have received ordinary income in an
amount equal to the difference between the option price and the fair market
value of the Units at the time of exercise. In the event an Optionee cannot sell
Units acquired on the exercise of an option without incurring liability under
Section 16(b) of the Securities Exchange Act of 1934, the recognition of income
in respect of exercise is delayed (unless the Optionee elects otherwise under
Section 83(b) of the Code within 30 days of the exercise) until the earlier of
(i) the end of six months after the purchase of the shares or (ii) the first day
such restriction ceases.
The Partnership may claim a tax deduction in an amount equal to the
ordinary income realized by the Optionee, provided the Partnership satisfies its
reporting obligations under the Code. Unless the Optionee is an independent
contractor or foreign resident, the Partnership may be required to withhold
income taxes and employment taxes payable in connection with the exercise of a
Unit option. The Partnership may withhold applicable payroll taxes from regular
wages or supplemental wages, or take steps to otherwise insure that the amount
of taxes required to be withheld is available for payment, including the
withholding of an appropriate number of Units to be issued upon the exercise of
an option.
The foregoing is a summary of complex federal income tax laws affecting
the exercise of Unit option. State and local income tax consequences to an
Optionee may differ from federal income tax consequences. An Optionee who
intends to exercise an option or dispose of Units acquired on the exercise of an
option should consult his or her own tax advisor with respect to the federal,
state and local income tax consequences.
ASSIGNMENT AND FORFEITURE OF INTEREST
Options granted under the Plan and the rights and privileges conferred
thereby may not be transferred, assigned, pledged, or hypothecated in any manner
(whether by operation of law or otherwise) other than by will or applicable laws
of descent and distribution. Options granted pursuant to the Plan shall not be
subject to execution, attachment, or similar process. Upon any attempt to
transfer, assign, pledge, hypothecate, or otherwise dispose of any option under
the Plan or any rights or privilege conferred by the Plan, contrary to the
provisions thereof, or upon the sale, levy or any attachment or similar process
upon the rights and privileges conferred by any options granted under the Plan,
such option shall terminate and become void. No person may create a lien on any
funds, securities, or other property held under the Plan.
Options granted under the Plan shall generally expire on the earlier of
the following two events: (1) the date of expiration; or (2) the ninety-first
(91st) day following termination of employment. Special rules apply in the event
of the participant's retirement, death or disability.
The aggregate number and class of Units for which options are granted
under the Plan, as well
- 11 -
as options outstanding, shall be adjusted to reflect proportionately any split,
reverse split, combination, recapitalization, or other increase or decrease in
the number of Units. In addition, any option granted under the Plan shall
terminate if the limited partners of the Partnership receive cash, securities or
other property in exchange for or in connection with their Units as a result of
a merger, consolidation, reorganization or liquidation of the Partnership (other
than a mere transfer to a new entity, after which Unit holders own the same
proportionate interest in the new entity). Optionees, however, shall have the
right immediately prior to such an event to exercise their option in whole or in
part.
INFORMATION ABOUT THE PARTNERSHIP
The following documents are available to holders of options without
charge, upon written or oral request to the Partnership. Requests should be
directed to the Partnership's office, whose address is 19245 Tenth Avenue N.E.,
Poulsbo, Washington, 98370, and whose telephone number is (360) 697-6626.
(a) The Partnership's latest annual report filed pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 or the latest prospectus filed
pursuant to Rule 424(b) or (c) under the Securities Act of 1933, which contains,
either directly or by reference, certified financial statements for the
Partnership's latest fiscal year for which such statements have been filed.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since the end of the fiscal year covered by the
annual report or prospectus referred to in (a) above.
(c) The Partnership's definitive proxy statement filed pursuant to
Section 14 of the Securities Exchange Act of 1934 in connection with the latest
annual meeting of its limited partners, and any definitive proxy statements so
filed in connection with any subsequent special meetings of its Unit holders.
(d) The description of the Partnership's Units, which is contained in a
Registration Statement on Form 8-A filed pursuant to Section 12 of the
Securities Exchange Act of 1934, including any amendment or report filed for the
purpose of updating such description.
(e) Information as to Unit options, including the amount outstanding,
exercises, prices, and expiration dates, included in the Partnership's
definitive proxy statement, described in (c) above and which will be included in
the future either by the Partnership's proxy statements, annual reports, or
appendices to the prospectus.
January 30, 1998
- 12 -
Exhibit 5.1
[Davis Wright Tremaine LLP Letterhead]
February 9, 1998
Pope Resources Limited Partnership
19245 Tenth Avenue N.E.
Poulsbo, Washington 98370
Re: Unit Option Plan
Dear Ladies and Gentlemen:
We have acted as counsel to Pope Resources, A Delaware Limited Partnership (the
"Partnership"), in connection with its registration statement of its Unit Option
Plan and corresponding limited partnership units (the "Registration Statement").
Capitalized terms used herein that are not otherwise defined have the meanings
ascribed thereto as set forth in the Registration Statement and the exhibits
thereto.
We have examined such documents, papers, statutes and authorities as we have
deemed necessary to form a basis for the opinions hereinafter expressed. We have
assumed the genuineness of all signatures, the authenticity of documents,
certificates and records submitted to us as originals, the conformity to the
originals of all documents, certificates and records submitted to us as copies,
the legal capacity of all natural persons executing documents, certificates and
records, and the completeness and accuracy as of the date of this opinion letter
of the information contained in such documents, certificates and records.
Based upon the foregoing, we are of the opinion that:
1. The Partnership is duly formed and validly existing under the laws
of the State of Delaware.
2. The Plan, the Units and the options respecting such Units have
been duly authorized and, when appropriate certificates have been
duly executed by the proper officers of the Partnership's Managing
General Partner, will be validly issued, fully paid and
nonassessable.
- 13 -
Pope Resources Limited Partnership
February 9, 1998
Page 2
This opinion is limited to the laws of the States of Delaware and Washington and
the federal laws of the United States of the type typically applicable to
transactions contemplated by the Registration Statement. We express no opinion
with respect to the laws of any other country, state or jurisdiction.
This opinion letter is limited to the matters stated herein and no opinion is
implied or may be inferred beyond the matters expressly stated. This letter
speaks only as of the date hereof and is limited to present statutes,
regulations and administrative and judicial interpretations. We undertake no
responsibility to update or supplement this letter after the date hereof.
We consent to being named in the Registration Statement as counsel who are
passing upon the validity of the options to be issued pursuant to the
Registration Statement and to the reference to our name under the caption "Legal
Matters" in such Registration Statement. Subject to the foregoing, this opinion
letter may be relied upon by you only in connection with the Offering and may
not be used or relied upon by you for any other purpose or by any other person
for any purpose whatsoever without, in each instance, our prior written consent.
Very truly yours,
Davis Wright Tremaine LLP
/s/ Stuart C. Harris
Stuart C. Harris
DCB:mjw/ah
- - 14 -
