As filed with the Securities and Exchange Commission on June 21, 1996
Commission File No. 1-14040
- ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
HOST MARRIOTT SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 52-1938672
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
10400 Fernwood Road
Department 928.83
Bethesda, MD 20817-1109
(Address of Principal Executive Offices) (Zip Code)
HOST MARRIOTT SERVICES CORPORATION
NON-EMPLOYEE DIRECTORS' DEFERRED STOCK COMPENSATION PLAN
(Full title of the plan)
ANITA COOKE WELLS
Corporate Secretary
Host Marriott Services Corporation
10400 Fernwood Road
Department 928.83
Bethesda, MD 20817-1109
(301) 380-7000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
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Title of securities Amount Proposed Proposed Amount of
to be registered to be maximum maximum registration fee
registered offering aggregate
price offering
per price(1)
share(1)
- -----------------------------------------------------------------------------
Common Stock,
$1.00 par value per 100,000 $ 7.50 $ 750,000 $ 258.62
share. . . . .
- -----------------------------------------------------------------------------
(1) Pursuant to Rule 457(h), these prices are estimated solely for the purpose
of calculating the registration fee and are based upon the average of the high
and low sales prices of the Registrant's Common Stock on the New York Stock
Exchange on June 17, 1996.
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 employee benefit plan described herein. There
are also registered hereunder such additional indeterminate number of shares as
may be issued as a result of the antidilution provisions of the Plan.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents containing information specified by Part I of this Form
S-8 Registration Statement (the "Registration Statement") have been or will be
sent or given to participants in the plan listed on the cover of the
Registration Statement (the "Plan") as specified in Rule 428(b)(1) promulgated
by the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Securities Act"). Such documents are
not being filed with the Commission but constitute (along with the documents
incorporated by reference into the Registration Statement pursuant to Item 3 of
Part II hereof), a prospectus that meets the requirements of Section 10(a) of
the Securities Act.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Commission are incorporated
herein by reference:
(1) The Amended Annual Report on Form 10-K/A of Host Marriott Services
Corporation, a Delaware corporation (the "Company"), for the fiscal
year ended December 29, 1995.
(2) The Quarterly Report on Form 10-Q/A of Host Marriott Services
Corporation, a Delaware corporation (the "Company"), for the twelve
weeks ended March 22, 1996.
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 (the "Exchange
Act"), as amended, prior to the filing of a post effective amendment that (1)
indicates that all securities offered pursuant to this Registration Statement
have been sold or (2) 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 the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law (the "DGCL")
provides for the indemnification of officers and directors under certain
circumstances against expenses (including attorneys fees, judgments, fines and
amounts paid in settlement) actually and reasonably incurred in connection with
the defense or settlement of any threatened, pending or completed legal
proceedings in which he or she is involved by reason of the fact that he or she
is or was a director or officer of the Company if he or she acted in good faith
and in a manner that he or she reasonably believed to be in or not opposed to
the best interests of the Company, and, in respect to the criminal actions or
proceedings, if he or she had no reasonable cause to believe that his or her
conduct was unlawful. The Certificate and By-laws of the Company provide for
indemnification of its officers and directors to the full extent authorized by
law.
The Company maintains officers' and directors' liability insurance
which insures against liabilities that the officers and directors of the Company
may incur in such capacities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable
ITEM 8. EXHIBITS
Exhibit
2
<PAGE>
NUMBER DESCRIPTION
4.1 The Plan.
23.1 Consent of Arthur Andersen LLP.
23.2 Opinion of the Company's Law Department.
24 The Power of Attorney by the Officers and Directors
who signed this Registration Statement is set forth
on page 5 herein.
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:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;
(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 by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or
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otherwise, the registrant has been advised that in the opinion of the Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing 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 Bethesda, State of Maryland, on this 21st day of
June, 1996.
HOST MARRIOTT SERVICES CORPORATION
By /s/ Joe P. Martin
-------------------------------
Joe P. Martin
General Counsel
THE PLAN. Pursuant to the requirements of the Securities Act of 1933,
the Plan's administrator has caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Bethesda, State of Maryland, on this 21st day of June, 1996.
HOST MARRIOTT SERVICES CORPORATION NON-EMPLOYEE
DIRECTORS' DEFERRED STOCK COMPENSATION PLAN
By *
-------------------------------
Rosemary M. Collyer
Chair, Compensation Policy Committee of
the Board of Directors of Host Marriott
Services Corporation
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below under the heading "Signatures" constitutes and appoints Anita
Cooke Wells and Joe P. Martin his or her true and lawful attorney-in-fact and
agent with full power of substitution and resubstitution, for him or her and in
his or her name, place and stead, in any and all capacities to sign any or all
amendments to this Registration Statement, and to file the same with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, each acting alone, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully for all intents and purposes as he or she might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, each acting alone, or his or her substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities indicated
on this 21st day of June, 1996.
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SIGNATURE TITLE
*
- -------------------------------- Chairman of the Board of Directors
William J. Shaw
*
- -------------------------------- President, Chief Executive Officer
William W. McCarten (Principal Executive Officer)
Director
*
- -------------------------------- Senior Vice President and
Brian W. Bethers Chief Financial Officer
(Principal Financial Officer)
*
- -------------------------------- Vice President-Finance and
Brian J. Gallant Corporate Controller
(Principal Accounting Officer)
*
- -------------------------------- Director
Rosemary M. Collyer
*
- -------------------------------- Director
J.W. Marriott, Jr.
*
- -------------------------------- Director
Richard E. Marriott
*
- -------------------------------- Director
R. Michael McCullough
*
- -------------------------------- Director
Gilbert T. Ray
*
- -------------------------------- Director
Andrew J. Young
* By /s/ Joe P. Martin
-------------------------
Joe P. Martin
Attorney-in-fact
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<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
4.1 The Plan.
23.1 Consent of Arthur Andersen LLP.
23.2 Opinion of the Company's Law Department .
24 The Power of Attorney executed by the officers and
directors who signed this Registration Statement is
set forth on page 5 herein.
7
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our reports dated
February 23, 1996 included in Host Marriott Services Corporation's Form 10-K/A
for the year ended December 29, 1995 and to all references to our Firm included
in this registration statement.
ARTHUR ANDERSEN LLP
Washington, D.C.
June 19, 1996
8
[LOGO] HOST MARRIOTT
SERVICES
Host Marriott Services Corporation
10400 Fernwood Road
Bethesda, MD 20817-1109
301/380-3532
301/380-7626 Fax
Joe P. Martin
Senior Vice President and General Counsel
June 20, 1996
Securities and Exchange Commission
450 Fifth Street, NW
Washington, D.C. 20549
Re: Host Marriott Services Corporation Non-Employee
Directors' Deferred Stock Compensation Plan
REGISTRATION ON FORM S-8
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-8
(the "Registration Statement") of Host Marriott Services Corporation, a Delaware
corporation (the "Company"), to be filed on or about June 21, 1996, with the
Securities and Exchange Commission ("SEC") under the Securities Act of 1933, as
amended (the "Act"), in connection with a proposed offering by the Company to
certain of its non-employee directors of 100,000 shares of the Company's common
stock (the "Shares"), under the Host Marriott Services Corporation Non-Employee
Directors' Deferred Stock Compensation Plan (the "Plan"), you have asked for my
opinion as to the validity of the shares.
In my capacity as General Counsel for the Company, I am
familiar with and have reviewed (1) the Company's Certificate of Incorporation
and its by-laws, in each case as amended as of the date hereof, (2) the
Registration Statement, including the exhibits thereto, (3) the materials
maintained by the Company as Part I of the Registration Statement, and such
other documents that I believe necessary and appropriate.
Subject to the foregoing and the other matters set forth
herein, it is my opinion that upon issuance the Shares will be duly and validly
authorized and, when distributed pursuant to the offering contemplated by the
Registration Statement, will be validly issued, fully paid and nonassessable.
I consent to your filing this opinion as an exhibit to the
Registration Statement.
By: /s/ Joe P. Martin
---------------------
Joe P. Martin
Title: Senior Vice President
and General Counsel
HOST MARRIOTT SERVICES CORPORATION
NON-EMPLOYEE DIRECTORS'
DEFERRED STOCK COMPENSATION PLAN
<PAGE>
As adopted effective
December 30, 1995
HOST MARRIOTT SERVICES CORPORATION
NON-EMPLOYEE DIRECTORS'
DEFERRED STOCK COMPENSATION PLAN
ARTICLE I
PURPOSE AND EFFECTIVE DATE
1.1 PURPOSE. The Host Marriott Services Corporation Non- Employee
Directors' Deferred Stock Compensation Plan (the "Plan") is intended to advance
the interests of the Company and its shareholders by providing a means to
attract and retain highly- qualified persons to serve as non-employee Directors
and to promote ownership by non-employee Directors of a greater proprietary
interest in the Company, thereby aligning such Directors' interests more closely
with the interests of shareholders of the Company.
1.2 EFFECTIVE DATE. This Plan shall become effective
December 30, 1995, having been approved by the Board of Host
Marriott Corporation as the sole shareholder.
ARTICLE II
DEFINITIONS
The following terms shall be defined as set forth below:
2.1 "BOARD" means the Board of Directors of the Company.
2.2 "COMMITTEE" has the meaning set forth in Section 4.1.
2.3 "COMPANY" means Host Marriott Services Corporation, a
Delaware corporation, or any successor thereto.
2.4 "DIRECTOR" means any individual who is a member of the
Board.
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2.5 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended. References to any provision of the Exchange Act include rules
thereunder and successor provisions and rules thereto.
2.6 "FAIR MARKET VALUE" means the average of the highest and lowest
quoted selling prices for the Shares on the relevant date, or (if there were no
sales on such date) the average so computed on the nearest day before or the
nearest day after the relevant date, as reported in The Wall Street Journal or a
similar publication selected by the Committee.
2.7 "FEES" means all or part of any retainer and/or fees
payable to a non-employee Director in his or her capacity as a
Director.
2.8 "PARTICIPANT" means a non-employee Director who defers
Fees under Article VI of this Plan.
2.9 "SECRETARY" means the Corporate Secretary or any
Assistant Corporate Secretary of Host Marriott Services
Corporation.
2.10 "SHARES" means shares of the common stock of Host Marriott
Services Corporation, or of any successor corporation or other legal entity
adopting this Plan.
2.11 "STOCK UNITS" means the credits to a Participant's Stock Unit
Account under Article VI of this Plan, each of which represents the right to
receive one Share upon settlement of the Stock Unit Account.
2.12 "STOCK UNIT ACCOUNT" means the bookkeeping account
established by the Company pursuant to Section 6.4.
2.13 "TERMINATION OF SERVICE" means termination of service
as a Director in any of the following circumstances:
(a) Where the Participant voluntarily resigns or
retires;
(b) Where the Participant is not re-elected (or
elected in the case of an appointed Director) to the Board by the
shareholders; or
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(c) Where the Participant dies.
ARTICLE III
SHARES AVAILABLE UNDER THE PLAN
Subject to adjustment as provided in Article X, the maximum number of
Shares that may be distributed in settlement of Stock Unit Accounts under this
Plan shall not exceed 100,000. Such Shares may include authorized but unissued
Shares or Treasury Shares.
ARTICLE IV
ADMINISTRATION
4.1 This Plan shall be administered by the Board's Compensation Policy
Committee of the Board (the "Committee"), or such other committee or individual
as may be designated by the Board. Notwithstanding the foregoing, no Director
who is a Participant under this Plan shall participate in any determination
relating solely or primarily to his or her own Shares, Stock Units or Stock Unit
Account.
4.2 It shall be the duty of the Committee to administer this Plan in
accordance with its provisions and to make such recommendations of amendments or
otherwise as it deems necessary or appropriate.
4.3 The Committee shall have the authority to make all determinations
it deems necessary or advisable for administering this Plan, subject to the
limitations in Section 4.1 and other explicit provisions of this Plan.
ARTICLE V
ELIGIBILITY
5.1 Each Director who is not an employee of the Company shall be
eligible to defer Fees under Article VI of this Plan.
5.2 If such Director subsequently becomes an employee of the Company (or
any of its subsidiaries), but does not incur a Termination of Service, such
Director shall (a) continue as a Participant with respect to Fees previously
deferred and (b)
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cease eligibility, with respect to all future Fees, if any, earned while an
employee.
ARTICLE VI
DEFERRAL ELECTIONS IN LIEU OF CASH PAYMENTS
6.1 GENERAL RULE. Each Director may, in lieu of receipt of Fees, defer
such Fees in accordance with this Article VI, provided that such Director is
eligible under Article V of this Plan to defer such Fees at the date any such
Fees are otherwise payable.
6.2 TIMING OF ELECTION. Each eligible Director who wishes to defer Fees
under this Plan must make an irrevocable written election at least six (6)
months prior to the start of the calendar year for which the Fees would
otherwise be paid; provided, however, that with respect to (a) any elections
made by Directors in 1996, and (b) any election made by a newly-elected or
appointed Director, the following special rule shall apply.
The election must be made at least 60 days prior to the date the deferred Fees
could otherwise have been payable to the Director and the Company shall hold
such deferred Fees (without interest) and convert them pursuant to Section 6.4
on or as of the date which follows by six months such deferral election. An
election by a Director shall be deemed to be continuing and therefore applicable
to Fees to be paid in future years unless the Director revokes or changes such
election by filing a new election form by the due date for such form specified
in this Section 6.2.
6.3 FORM OF ELECTION. An election shall be made in a manner
satisfactory to the Secretary. Generally, an election shall be made by
completing and filing the specified election form with the Secretary of the
Company within the period described in Section 6.2. At minimum, the form shall
require the Director to specify the following:
(a) a percentage (in 25% increments), not to exceed an
aggregate of 100% of the Fees to be deferred under this Plan; and
(b) the manner of settlement in accordance with
Section 7.2.
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In the event Directors' Fees are increased or decreased during any calendar
year, a Participant's election in effect for such year will apply to the
specified percentage of Fees as increased or decreased.
6.4 ESTABLISHMENT OF STOCK UNIT ACCOUNT. The Company will establish a
Stock Unit Account for each Participant. All Fees deferred pursuant to this
Article VI shall be credited to the Participant's Stock Unit Account as of the
date the Fees would otherwise have been paid to the Participant (the "Deferral
Date") and converted to Stock Units as follows: The number of Stock Units shall
equal the deferred Fees divided by the Fair Market Value of a Share on the
Deferral Date, with fractional units calculated to at least three (3) decimal
places.
6.5 CREDIT OF DIVIDEND EQUIVALENTS. As of each dividend payment date
with respect to Shares, each Participant shall have credited to his or her Stock
Unit Account an additional number of Stock Units equal to: the per-share cash
dividend payable with respect to a Share on such dividend payment date
multiplied by the number of Stock Units held in the Stock Unit Account as of the
close of business on the record date for such dividend divided by the Fair
Market Value of a Share on such dividend payment date. If dividends are paid on
Shares in a form other than cash, then such dividends shall be notionally
converted to cash, if their value is readily determinable, and credited in a
manner consistent with the foregoing and, if their value is not readily
determinable, shall be credited "in kind" to the Participant's Stock Unit
Account.
ARTICLE VII
SETTLEMENT OF STOCK UNITS
7.1 SETTLEMENT OF ACCOUNT. The Company will settle a Participant's
Stock Unit Account in the manner described in Section 7.2 as soon as
administratively feasible following notification of such Participant's
Termination of Service.
7.2 PAYMENT OPTIONS. An election filed under Article VI shall specify
whether the Participant's Stock Unit Account is to be settled by delivering to
the Participant (or his or her beneficiary) the number of Shares equal to the
number of whole Stock Units then credited to the Participant's Stock Unit
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Account, in (a) a lump sum, or (b) substantially equal annual installments over
a period not to exceed ten (10) years. If, upon lump sum distribution or final
distribution of an installment, less than one whole Stock Unit is credited to a
Participant's Stock Unit Account, cash will be paid in lieu of fractional shares
on the date of such distribution.
7.3 CONTINUATION OF DIVIDEND EQUIVALENTS. If payment of Stock Units is
deferred and paid in installments, the Participant's Stock Unit Account shall
continue to be credited with dividend equivalents as provided in Section 6.5.
7.4 IN KIND DIVIDENDS. If any "in kind" dividends were credited to the
Participant's Stock Unit Account under Section 6.5, such dividends shall be
payable to the Participant in full on the date of the first distribution of
Shares under Section 7.2.
ARTICLE VIII
UNFUNDED STATUS
The interest of each Participant in any Fees deferred under this Plan (and
any Stock Units or Stock Unit Account relating thereto) shall be that of a
general creditor of the Company. Stock Unit Accounts, and Stock Units (and, if
any, "in kind" dividends) credited thereto, shall at all times be maintained by
the Company as bookkeeping entries evidencing unfunded and unsecured general
obligations of the Company.
ARTICLE IX
DESIGNATION OF BENEFICIARY
Each Participant may designate, on a form provided by the Secretary, one or
more beneficiaries to receive the Shares described in Section 7.2 in the event
of such Participant's death. The Company may rely upon the beneficiary
designation last filed with the Committee, provided that such form was executed
by the Participant or his or her legal representative and filed with the
Committee prior to the Participant's death.
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ARTICLE X
ADJUSTMENT PROVISIONS
In the event any recapitalization, reorganization, merger, consolidation,
spin-off, combination, repurchase, exchange of shares or other securities of the
Company, stock split or reverse split, or similar corporate transaction or event
affects Shares such that an adjustment is determined by the Board or Committee
to be appropriate to prevent dilution or enlargement of Participants' rights
under this Plan, then the Board or Committee will, in a manner that is
proportionate to the change to the Shares and is otherwise equitable, adjust the
number or kind of Shares to be delivered upon settlement of Stock Unit Accounts
under Article VII.
ARTICLE XI
COMPLIANCE WITH RULE 16b-3
It is the intent of the Company that this Plan comply in all respects with
applicable provisions of Rule 16b-3 under the Exchange Act in the connection
with the deferral of Fees. Thus, other provisions of this Plan notwithstanding,
if any deferral of Fees would occur less than six (6) months after the
Participant filed an irrevocable election which would result in such deferral
and at a time that the Company's employee benefit plans are being operated in
conformity with Rule 16b-3 as adopted and in effect, such deferral election may
be modified in a manner consistent with the special rule described in Section
6.2 or in any other manner consistent with Rule 16b-3 as then applicable to any
transaction by a Participant subject to Section 16 of the Exchange Act, or would
cause any Participant or Director to no longer be deemed a "disinterested
person" within the meaning of Rule. 16b-3, such provision will be construed or
deemed amended to the extent necessary to conform to such requirements with
respect to such Participant or Director.
ARTICLE XII
GENERAL PROVISIONS
12.1 NO RIGHT TO CONTINUE AS A DIRECTOR. Nothing contained in this Plan
will confer upon any Participant any right to continue to serve as a Director.
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12.2 NO SHAREHOLDER RIGHTS CONFERRED. Nothing contained in
this Plan will confer upon any Participant any rights of a
shareholder of the Company unless and until Shares are in fact issued or
transferred to such Participant in accordance with Article VII.
12.3 CHANGE TO THE PLAN. The Board may amend, alter, suspend,
discontinue, or terminate the Plan without the consent of shareholders or
Participants, except that any such action will be subject to the approval of the
Company's shareholders at the next annual meeting of shareholders having a
record date after the date such action was taken if such stockholder approval is
required by any federal or state law or regulation or the rules of any stock
exchange or automated quotation system on which the Shares may then be listed or
quoted, or if the Board determines in its discretion to seek such shareholder
approval; provided; however, that, without the consent of an affected
Participant, no such action may materially impair the rights of such Participant
with respect to any Stock Units credited to his or her Stock Unit Account; and
provided, however, that any "plan provision" referred to in Rule
16b-3(c)(2)(ii)(B) under the Exchange Act shall not be amended more than once
every six months, other than to comport with changes in the Internal Revenue
Code or the Exchange Act or the rules thereunder.
12.4 CONSIDERATION; AGREEMENTS. The consideration for
Shares issued or delivered in lieu of payment of Fees will be the
Director's service during the period to which the Fees paid in
the form of Shares related.
12.5 COMPLIANCE WITH LAWS AND OBLIGATIONS. The Company will not be
obligated to issue or deliver Shares in connection with this Plan in a
transaction subject to the registration require ments of the Securities Act of
1933, as amended, or any other federal or state securities law, any requirement
under any listing agreement between the Company and any national securities
exchange or automated quotation system or any other laws, regula tions, or
contractual obligations of the Company, until the Company is satisfied that such
laws, regulations, and other obligations of the Company have been complied with
in full. Certificates representing Shares delivered under the Plan will be
subject to such stop-transfer orders and other restrictions as may be applicable
under such laws, regulations, and other
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obligations of the Company, including any requirement that a legend or
legends be placed thereon.
12.6 LIMITATIONS ON TRANSFERABILITY. Stock Units and any other right under
the Plan that may constitute a "derivative security" as generally defined in
Rule 16a-l(c) under the Exchange Act will not be transferable by a Participant
except by will or the laws of descent and distribution (or to a designated
beneficiary in the event of a Participant's death); provided, however, that such
rights may be transferred to one or more trusts or other beneficiaries during
the lifetime of the Participant in connection with the Participant's estate
planning, but only if and to the extent then permitted under Rule 16b-3 and
consistent with the registration of the offer and sale of Shares on Form S-8 or
successor registration form of the Securities and Exchange Commission. Stock
Units and other rights under the Plan may not be pledged, mortgaged,
hypothecated, or otherwise encumbered, and shall not be subject to the claims of
creditors.
12.7 GOVERNING LAW. The validity, construction, and effect of the Plan
and any agreement hereunder will be determined in accordance with the Delaware
General Corporation Law, to the extent applicable, other laws (including those
governing contracts) of the State of Maryland, without giving effect to
principles of conflicts of laws, and applicable federal law.
12.8 PLAN TERMINATION. Unless earlier terminated by action of the Board or
Executive Committee of the Board, the Plan will remain in effect until such time
as no Shares remain available for delivery under the Plan and the Company has no
further rights or obligations under the Plan.
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