As filed with the Securities and Exchange Commission on August 8, 1997
Registration No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
COVANCE INC.
(Exact name of Registrant as specified in its Charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 210 Carnegie Center 22-3265977
(State of Incorporation) Princeton, New Jersey 08540-6233 (I.R.S. Employer
(Address of principal executive offices) Identification Number)
</TABLE>
COVANCE INC.
RESTRICTED SHARE PLAN
(Full Title of the Plan)
Jeffrey S. Hurwitz, Esq.
Corporate Senior Vice President,
General Counsel and Secretary
Covance Inc.
210 Carnegie Center
Princeton, New Jersey 08540-6233
(Name and address of agent for service)
(609) 452-4430
(Telephone number, including area code, of agent for service)
Copy to:
Shearman & Sterling
599 Lexington Avenue
Room 712
New York, New York 10022
Attention: Stephen T. Giove, Esq.
(212) 848-7325
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------
Title of Securities to Amount to be Proposed Maximum Proposed Maximum Amount of
be Registered Registered Offering Price per Aggregate Offering Registration Fee
Share(1) Price(1)
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock Par 343,428 $ 19.9375 $ 6,847,095.75 $2,074.88
Value $.01 per share
- -----------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for purposes of determining the registration fee in
accordance with Rule 457(h) under the Securities Act of 1933.
<PAGE>
PART I
INFORMATION REQUIRED IN SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with the
Introductory Note to Part I of Form S-8.
Item 2. Company Information and Employee Plan Annual Information.
Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with the
Introductory Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed or to be filed by Covance Inc. ("the
Company") with the Securities and Exchange Commission (the "Commission") are
incorporated by reference in this Registration Statement as of their respective
dates:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996 filed pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), containing audited financial statements for
the Registrant's latest fiscal year, including any amendment or report
filed for the purpose of updating such description.
2. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 10, declared effective by the
Commission on November 26, 1996 pursuant to Section 12(b) of the Exchange
Act, 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 Exchange Act, prior to the filing with the Commission
of a post-effective amendment to this Registration Statement that indicates that
all securities offered have been sold or effects the deregistration of the
balance of such securities then remaining unsold shall be deemed to be
incorporated herein by reference and to be part hereof from the date of filing
of such documents.
Item 4. Description of Securities.
Incorporated by reference to Registrant's Form 10 declared effective by the
Commission on November 26, 1996 pursuant to Section 12(b) of the Exchange Act,
including any amendment or report filed for the purpose of updating such
description.
1
<PAGE>
Item 5. Interests of Named Experts and Counsel.
Jeffrey S. Hurwitz, Corporate Senior Vice President, General Counsel and
Secretary of the Company, issued the opinion as to the legality of securities
being registered herein, attached as Exhibit 5.1 hereto. Mr. Hurwitz may
participate in the Restricted Share Plan, participates in other Company stock
and option benefit plans and holds directly shares of the Company's Common
Stock.
Item 6. Indemnification of Directors and Officers.
As permitted by the Delaware Law, the Company's Restated Certificate of
Incorporation provides that directors of the Company shall not be personally
liable to the Company or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any 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, relating to prohibited dividends or distributions or the repurchase or
redemption of stock or (iv) for any transaction from which the director derives
an improper personal benefit. In addition, the Company's Restated Certificate of
Incorporation provides for indemnification of the Company's officers and
directors to the fullest extent permitted under Delaware law. Section 145 of the
Delaware Law provides that a corporation may indemnify any persons, including
officers and directors, who were or are, or are threatened to be made, parties
to any threatened, pending or completed legal action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of such corporation), by reason of the fact that such person
was an officer, director, employee or agent of such corporation or is or was
serving at the request of such corporation as an officer, director, employee or
agent of another corporation, partnership, joint venture, trust or other
enterprise. The indemnity may include expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such person in connection with such action, suit or proceeding, provided such
person acted in good faith and in a manner he reasonably believed to be in or
not opposed to the corporation's best interests and, for criminal proceedings,
had no reasonable cause to believe that his conduct was unlawful. A Delaware
corporation may indemnify officers and directors in an action by or in the right
of the corporation under the same conditions, except that no indemnification is
permitted without judicial approval if the officer or director is adjudged to be
liable to the corporation. Where an officer or director is successful on the
merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him against the expenses that such officer or
director actually and reasonably incurred. Insofar as indemnification for
liabilities arising under the Securities Act of 1933, as amended (the
"Securities Act"), may be permitted to directors, officers or persons
controlling the Company pursuant to the foregoing provisions, the Company has
been informed that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable.
The directors and officers of the Company are insured against certain
liabilities under the Company's directors' and officers' liability insurance.
2
<PAGE>
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The following exhibits are filed herewith:
Exhibit
No. Document
------- --------
4.1 Covance Inc. Restricted Share Plan.
5.1 Opinion of the General Counsel as to the legality of
securities being registered.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of the General Counsel (contained in the opinion
filed as Exhibit 5.1 to this Registration Statement).
24.1 Power of Attorney (included on Signature Page).
Item 9. Undertakings.
The undersigned Company 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 this 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. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in this
Registration Statement.
3
<PAGE>
(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 (i) and (ii) of this section 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
Commission by the Company 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.
(4) that, for purposes of determining any liability under the Securities
Act, each filing of the Company'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.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company 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 Company of expenses incurred or paid by a director, officer
or controlling person of the Company 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 Company 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.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Company 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 Princeton and State of New Jersey on August 8, 1997.
COVANCE INC.
By: /s/ Christopher A. Kuebler
--------------------------------------------
Christopher A. Kuebler
Chairman, President and Chief Executive
Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Jeffrey S. Hurwitz and Diana Ingallinera Faillace each of them, his true and
lawful attorneys-in-fact and agents each with full power of substitution and
resubstitution for him in any and all capacities to sign any and all amendments
(including pre- or post-effective amendments) to this Registration Statement on
Form S-8 and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, hereby ratifying and confirming all that
each such attorney-in-fact, or his substitute or substitutes, may do or cause to
be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Christopher A. Kuebler
- --------------------------
Christopher A. Kuebler Chairman of the Board, August 8, 1997
President and Chief Executive Officer
(Principal Executive Officer)
/s/ Charles C. Harwood, Jr.
- ---------------------------
Charles C. Harwood, Jr. Corporate Senior Vice President and August 8, 1997
Chief Financial Officer (Principal
Financial Officer)
/s/ Michael Giannetto
- ---------------------
Michael Giannetto Vice President and Controller August 8, 1997
(Principal Accounting Officer)
/s/ Robert M. Baylis
- --------------------
Robert M. Baylis Director August 8, 1997
/s/ Van C. Campbell
- -------------------
Van C. Campbell Director August 8, 1997
/s/ Irwin Lerner
- ----------------
Irwin Lerner Director August 8, 1997
/s/ J. Randall MacDonald
- ------------------------
J. Randall MacDonald Director August 8, 1997
/s/ Nigel W. Morris
- -------------------
Nigel W. Morris Director August 8, 1997
/s/ William A. Ughetta
- ----------------------
William A. Ughetta Director August 8, 1997
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No Document Page No.
- ---------- -------- --------
<S> <C> <C>
4.1 Covance Inc. Restricted Share Plan. Filed herewith.
5.1 Opinion of the General Counsel as to the legality of securities
being registered. Filed herewith.
23.1 Consent of Price Waterhouse LLP. Filed herewith.
23.2 Consent of the General Counsel (contained in opinion filed as
Exhibit 5.1 to this Registration Statement). Filed herewith.
24.1 Power of Attorney (included on Signature Page). Filed herewith.
</TABLE>
Exhibit 4.1
<PAGE>
COVANCE, INC.
================================================================================
COVANCE
RESTRICTED SHARE PLAN
================================================================================
<PAGE>
Covance Restricted Share Plan
CONTENTS
Rule Page No.
1. DEFINITIONS.............................................................. 1
2. GRANT OF AWARDS.......................................................... 5
3. CONDITIONS RELATING TO THE GRANT OF AWARDS............................... 7
4. RIGHTS OF AWARD HOLDER DURING VESTING PERIOD............................. 9
5. LAPSE OF AWARDS.......................................................... 9
6. TERMINATION OF VESTING PERIOD AND LAPSE OF AWARDS........................ 9
7. RELEASE OF RESTRICTED SHARES............................................ 11
8. ISSUE OF SHARES......................................................... 11
9. DISCRETION AS TO FORM OF PAYMENT........................................ 12
10. ADJUSTMENTS............................................................ 12
11. ADMINISTRATION......................................................... 13
12. ALTERATIONS............................................................ 14
13. GENERAL................................................................ 15
APPENDIX A1................................................................ 16
APPENDIX A2................................................................ 17
APPENDIX B: 1996 ALLOCATION............................................... 18
<PAGE>
Rules of the Covance Restricted Share Plan
1. DEFINITIONS
In this Plan, the following words and expressions shall, where the context
so permits, have the meanings set forth below:
"the Auditors" the auditors for the time being of the Company
acting as experts and not as arbitrators;
"Award" an award or allocation of Restricted Shares
pursuant to the Plan;
"Award Certificate" a certificate issued under Rule 2.4;
"Award Holder" a person to whom an Award has been granted (or
as the context requires, his personal
representatives);
"Base Compensation" the annual rate of salary of an Eligible
Employee (or where appropriate, its Market
Value equivalent), excluding bonuses and
benefits in-kind;
"Committee" the Compensation Committee of the board of
directors of the Company that administers the
Plan;
<PAGE>
Page 2
"the Company" Covance, Inc. (Covance);
"Date of Grant" the date as of which an Award is granted under
the Plan pursuant to Rule 2, which is December
31 of each calendar year; for the 1996 calendar
year, 15 January 1997 shall be used for
purposes of computing the Market Value of
Shares;
"Eligible Employee" any person who is a US Eligible Employee or an
International Eligible Employee;
"Group" the Company and its Subsidiaries and `member of
the Group' shall be construed accordingly;
"International Eligible any person who is a director or employee of an
Employee" International Participating Company;
"International a member of the Group, which the Committee has
Participating Company" designated to participate in the Plan as an
International Participating Company; Appendix
A(1) lists the International Participating
Companies at the date of establishment of the
Plan;
<PAGE>
Page 3
"Market Value" in relation to a Share on any Date of Grant is
the daily-weighted average quotation for such
Share on the New York Stock Exchange over the
five business days starting on the Date of
Grant and in relation to the US dollar/local
currency unit exchange rate is the rate on the
Date of Grant as reported by The Wall Street
Journal.
"Participating Company" any US Participating Company or International
Participating Company;
"Restricted Shares" Shares which are the subject of an extant Award
under the Plan in relation to which the Vesting
Period has not terminated;
"Rules" the Rules of the Plan and `Rule' shall be
construed accordingly;
"the Plan" the Covance Restricted Share Plan in its
present form, or as from time to time altered
in accordance with the Rules;
<PAGE>
Page 4
"Share" a share of the class of common stock of the
Company that is traded on the New York Stock
Exchange;
"Subsidiary" has the meaning ascribed by Section 424(f) of
the US Internal Revenue Code of 1986;
"the Trustees" the trustees from time to time of the Trust for
the Plan;
"US Eligible Employee" any person who is a director or employee of a
US Participating Company and who is eligible to
receive a contribution under Section 2.1 of The
Covance Inc. Employee Stock Ownership Plan
(without regard to the limitations imposed by
Section 4.04, thereof);
"US Participating a member of the Group which the Board has
Company" designated to participate in the Plan as a US
Participating Company; Appendix A(2) lists the
US Participating Companies at the date of
establishment of the Plan;
"Vesting Period" the period of time from the Grant Date until
the date when the restrictions placed on the
Restricted Shares lapse;
<PAGE>
Page 5
References to any statutory provision are to that provision as amended or
re-enacted from time to time, and unless the context otherwise requires,
words in the singular shall include the plural (and vice versa) and words
importing the masculine the feminine (and vice versa).
2. GRANT OF AWARDS
2.1 (a) Subject to Rule 2.2, the Committee may, in its absolute
discretion, grant Awards under the Plan to Eligible Employees.
(b) The Committee may adopt such procedure as it deems fit for
granting Awards, whether by invitation to Eligible Employees to
apply for Awards or by granting Awards without issuing
invitations.
2.2 (a) 1996 Award to International Eligible Employees. The Committee
shall grant an Award to each person who is an International
Eligible Employee on 31 December 1996. The total number of
Shares available for award in 1996 shall be determined in
accordance with Appendix B. Such Award shall be allocated pro
rata to all International Eligible Employees, based on their
Annualized Base Compensation.
(b) 1996 Restricted Share Bonus Award to US Eligible Employees. The
Committee shall grant an Award to the US Eligible Employees in
accordance with Appendix B.
<PAGE>
Page 6
(c) 1997 and 1998 Awards to Eligible Employees. As of the applicable
Date of Grant, any amounts that lapse in 1997 or 1998 in
accordance with Rules 5 and 6, together with any contributions
that may be made by any member of the Group, shall be allocated
to individuals who first become Eligible Employees in the year
of lapse (i.e., those Eligible Employees hired in that year).
Such awards shall be allocated pro rata, based on Annualized
Base Compensation.
(d) 1999 and 2000 Awards to Eligible Employees. As of the applicable
Date of Grant, any amounts that lapse in 1999 or 2000 in
accordance with Rule 5, together with any contributions that may
be made by any member of the Group, shall be allocated per
capita to all participating Eligible Employees who are employed
by any member of the Group on that Date of Grant.
(e) The Committee may, in its absolute discretion, direct that
Company contributions be made to the Plan Trust by the Company
or other member of the Group for the purpose of allocation for
the 1997, 1998, 1999, or 2000 calendar year, as described above.
(f) Notwithstanding the foregoing, the Committee may, in its
absolute discretion, reduce or preclude any allocation to any US
Eligible Employee for the 1997, 1998, 1999, or 2000 calendar
year in order to avoid duplicating an allocation under The
Covance Inc. Employee Stock Ownership Plan.
<PAGE>
Page 7
2.3 The terms attaching to an Award may include, without limitation, a
condition that the granting of an Award is subject to the surrender
or cancellation of any or all outstanding Awards held by the Eligible
Employee.
2.4 The Company shall issue to each Eligible Employee to whom it has
granted an Award an Award Certificate, which shall be in such form as
the Committee shall from time to time determine. The Award
Certificate shall include details of:
(a) the Date of Grant of the Award;
(b) the number of Restricted Shares.
2.5 Each Eligible Employee to whom an Award is granted may by notice in
writing within 30 days of the Date of Grant disclaim in whole or in
part his rights under the Award in which case the Award shall for all
purposes be deemed never to have been granted.
2.6 Every Award shall be personal to the Eligible Employee to whom it is
granted and shall not be capable of being transferred, assigned, or
charged. Each Award Certificate shall carry a statement to this
effect.
3. CONDITIONS RELATING TO THE GRANT OF AWARDS
3.1 The Committee may determine that any Award shall be subject to
additional and/or modified terms and conditions relating to the grant
and terms of exercise as may be necessary to comply with or take
account of any securities, exchange control or
<PAGE>
Page 8
taxation laws, regulations, or practice of any territory which may
have application to the relevant Eligible Employee, Award Holder, or
member of the Group.
3.2 In exercising its discretion under Rule 3.1 the Committee may:
(a) require an Award Holder to make such declarations or take such
other action (if any) as may be required for the purpose of any
securities, taxes, or other laws of any territory which may be
applicable to him at the Date of Grant or at the end of the
Vesting Period; and
(b) adopt any supplemental rules or procedures governing Awards as
may be required for the purpose of any securities, tax, or
other laws of any territory which may be applicable to an
Eligible Employee or Award Holder.
3.3 When events have happened which cause the Committee to consider that
any existing constraints and/or conditions (as the case may be) have
become unfair or impractical, the Committee may, in its absolute
discretion, amend, relax, waive, or substitute such constraints or
conditions so that such constraints or conditions so amended,
relaxed, waived, or substituted would, in the reasonable opinion of
the Committee, be no more or less difficult to abide by or satisfy
than when they were originally imposed or last amended or relaxed (as
the case may be). After any such amendment, relaxation, waiver, or
substitution, the Committee shall issue to the Award Holder a
replacement Award Certificate or other notice including the details
specified in Rule 2.4.
<PAGE>
Page 9
4. RIGHTS OF AWARD HOLDER DURING VESTING PERIOD
4.1 During the Vesting Period, the Award Holder shall not sell, transfer,
pledge, assign, or otherwise dispose of all or any of the Restricted
Shares or any interest therein. Any attempt by the Award Holder to
sell, transfer, pledge, assign, or otherwise dispose of such
Restricted Shares, or any interest therein, shall result in immediate
forfeiture of such Award.
4.2 During the Vesting Period:
(a) the Trustees shall exercise (or refrain from exercising) the
voting rights attaching to the Restricted Shares subject to
Awards made to those Award Holders in such manner as they shall
in their absolute discretion think fit; and
(b) all dividends and other distributions with respect to such
Restricted Shares shall be used to acquire further Restricted
Shares which will be held subject to the Awards to which they
relate, and
(c) any scrip dividends shall be held subject to the Awards to which
they relate.
5. LAPSE OF AWARDS
Where any Award made under the Plan lapses, the Shares subject to that
Award shall be allocated in accordance with Rule 2.2.
6. TERMINATION OF VESTING PERIOD AND LAPSE OF AWARDS
6.1 The Vesting Period for an Award shall terminate on the January 1
following the second anniversary of the Award's Date of Grant, or if
earlier, the date on which the Award
<PAGE>
Page 10
Holder dies, attains age 65, or ceases to be an Eligible Employee by
reason of what the Committee considers, in its absolute discretion,
to be total and permanent disability; provided, however, that any
individual who is an Eligible Employee on January 1, 2001 shall be
fully vested; provided further, that an Eligible Employee may sooner
become fully vested upon a "Change of Control" of the Company.
There will be a "Change of Control" of the Company when:
(a) any person (including as such term is used in Section 13(d) and
14(d)(2) of the Securities Exchange Act of 1934) becomes the
beneficial owner, directly or indirectly, of the Company's
securities representing 20 percent or more of the combined
voting power of the Company's then outstanding securities;
(b) as a result of a proxy contest or contests or other forms of
contested shareholder votes (in each case either individually or
in the aggregate), a majority of the individuals elected to
serve on the Company's board of directors are different than the
individuals who served on the Company's board of directors at
any time within the two years prior to such proxy contest or
contests or other forms of contested shareholder votes (in each
case either individually or in the aggregate);
(c) the Company's shareholders approve a merger or consolidation
(where in each case the Company is not the survivor thereof) or
sale or disposition of all or substantially all of the Company's
assets or a plan of or partial or complete liquidation;
<PAGE>
Page 11
(d) an offerer (other than the Company) purchases shares of the
Company's common stock pursuant to a tender or exchange offer
for such shares.
6.2 To the extent that a Vesting Period has not expired, the Award shall
lapse on the date on which an Award Holder ceases to be an Eligible
Employee by reason of a termination of employment. For this purpose,
a leave of absence of an Eligible Employee that is approved by the
employing Participating Company that has a duration of three months
or less shall not in and of itself be considered a termination of
employment. Approved leaves of absence of greater duration may be
afforded the same treatment only if the Committee so decides in its
absolute discretion.
7. RELEASE OF RESTRICTED SHARES
When the Vesting Period in relation to an Award ends, the relevant
Restricted Shares shall be allotted or transferred (as the case may be) to
the Award Holder as soon as possible, and accordingly in cases where
Restricted Shares are to be transferred, the Company shall use its best
endeavors to insure due transfer thereof.
8. ISSUE OF SHARES
8.1 All Shares issued pursuant to Awards under the Plan shall as to
voting, dividend, transfer, and other rights (including those
arising on a liquidation) rank pari passu in all respects with the
Shares then in issue, except that they shall not rank for any
dividend or other rights declared by reference to a record date
preceding the date of issue.
<PAGE>
Page 12
8.2 If and so long as the Shares are listed on the New York Stock
Exchange, the Company shall use its best endeavors to procure that
as soon as practicable after the allotment of any Shares pursuant to
the Plan application shall be made to the New York Stock Exchange
for admission of the Shares to dealing.
9. DISCRETION AS TO FORM OF PAYMENT
9.1 On termination of the Vesting Period in relation to an Award, any
Award shall be paid in Shares, except that, in its absolute
discretion, the Committee may in lieu of allotting or procuring the
transfer of any or all Restricted Shares in accordance with Rule 7
pay to such Award Holder a cash sum equal to the market value of
such Restricted Shares as of the first business day following the
end of the Vesting Period.
9.2 If payment is made pursuant to this Rule to an Award Holder, he
shall have no further rights in respect of such Restricted Shares.
The Committee may make any deductions in respect of such payment
which it is required to make under the laws of any territory which
laws are applicable to the Award Holder and/or his employing member
of the Group.
10. ADJUSTMENTS
10.1 The number of Restricted Shares subject to an Award may be adjusted
in such manner as the Committee shall determine, in its absolute
discretion (and which the Auditors shall confirm in writing to be in
their opinion fair and reasonable), following any capitalization
issue, subdivision, consolidation, or reduction of share capital and
in
<PAGE>
Page 13
respect of any discount element in any rights issue or other
variation of share capital to the intent that (as nearly as may be
possible without involving fractions of a Share) the value of the
Award shall remain unchanged.
10.2 The Committee may take such steps as it may consider necessary to
notify Award Holders of any adjustments made under Rule 10.1 and to
call in, cancel, endorse, issue, or reissue any Award Certificate
consequent upon such adjustment.
11. ADMINISTRATION
11.1 Notices or documents required to be given to an Eligible Employee or
to an Award Holder shall either be delivered to him by hand or sent
to him by first class post, pre-paid at his last known home or
business address according to the information provided by him.
Notices sent by mail shall be deemed to have been given on the
seventh day following the date of posting.
11.2 The Company may distribute to Award Holders copies of any notice or
document sent by the Company to its shareholders generally.
11.3 The Company shall at all times either keep available sufficient
unissued Shares to satisfy all extant Awards (taking account of any
other obligations of the Company to allot unissued Shares) or shall
ensure that sufficient issued Shares will be available to satisfy
the exercise of such Awards.
<PAGE>
Page 14
11.4 The Committee may make such regulations for the administration of
the Plan as it deems fit, provided that no regulation shall be valid
to the extent it is inconsistent with the Rules.
11.5 The decision of the Committee in any dispute relating to an Award,
or the due exercise thereof, or any other matter in respect of the
Plan or any Rule, shall be final and conclusive, subject to the
determination of the Auditors, when so required by Rule.
11.6 The costs of establishing and administering the Plan and the
associated costs of making Awards shall be borne by the
Participating Companies in such proportions as the Committee deems
fit.
11.7 Any stamp duty chargeable on the instruments of transfer entered
into pursuant to each Award Agreement shall be borne by the Company,
or where relevant, the Participating Company employing the Award
Holders.
12. ALTERATIONS
12.1 Subject to Rule 12.2, the Committee may in its absolute discretion
alter the Rules.
12.2 No alteration may be made which would abrogate or adversely affect
the subsisting rights of Award Holders.
<PAGE>
Page 15
12.3 Written notice of any amendment made in accordance with this Rule 12
shall be given to all Award Holders.
13. GENERAL
13.1 The Plan shall terminate on the tenth anniversary of the date on
which it is approved by the Company in general meeting or at any
earlier time by the passing of a resolution by the Committee.
Termination of the Plan shall be without prejudice to the subsisting
rights of Award Holders.
13.2 If an Award Holder shall cease for any reason to be in the
employment of a member of the Group, he shall not be entitled, by
way of compensation for loss of office or otherwise howsoever, to
any sum or any benefit to compensate him for the loss of any right
or benefit accrued or in prospect under the Plan.
13.3 This Plan and all Awards shall be governed by and construed in
accordance with English law.
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Page 16
APPENDIX A1
International Participating Companies
CORNING Bessalear Limited (England)
CORNING Bessalear Limited (Ireland)
GHBA A.G.
CORNING Bessalear AG
G.H. Bessalear Associates GmbH
CORNING Bessalear Pty. Ltd.
CORNING Bessalear S.A.
CORNING Bessalear SARL
CORNING Hazleton GmbH
CORNING SciCor S.A.
CORNING Pharmaceutical Services Ltd.
CORNING Bessalear Ltd.
CORNING Bessalear CRU Ltd.
CORNING Hazleton Ltd.
CRS Pacmed A.G.
<PAGE>
Page 17
APPENDIX A2
US Participating Companies
COVANCE INC. (f/k/a Corning Pharmaceutical Services Inc.)(Delaware)
Covance Clinical and Periapproval Services Inc. (f/k/a Corning Besselaar Inc.)
(New Jersey)
Covance Clinical Research Unit Inc. (f/k/a Corning Besselaar Clinical Research
Units Inc.)(Florida)
Covance Periapproval Services Inc. (f/k/a Corning Pact Inc.)(Delaware)
Covance Preclinical Corporation (f/k/a Hazleton Corporation)(Washington)
Covance Laboratories Inc. (f/k/a/ Corning Hazleton Inc.)(Delaware)
Covance Research Products Inc. (f/k/a HRP Inc.)(Pennsylvania)
Covance Central Laboratory Services Inc. (f/k/a Corning SciCor Inc.)
Covance Central Laboratory Limited Partnership dba Covance Central Laboratory
Services Inc. (f/k/a/ Corning SciCor Limited Partnership)(Indiana)
Covance Pharmaceutical Packaging Services Inc. (f/k/a Corning National Packaging
Inc.)(Connecticut)
Covance Health Economics and Outcome Services Inc. (f/k/a Corning HTA Inc.)
(Delaware)
Covance Biotechnology Services Inc. (f/k/a Corning Bio Inc.)(Delaware)
Pharmaceutical Laboratory Services Inc.
<PAGE>
Page 18
APPENDIX B: 1996 ALLOCATION
The 1996 Total allocation shall be determined as follows:
1. 1996 Total Allocation. The 1996 total allocation shall be determined as
follows: the total allocation of shares to the Covance Employee Stock
Ownership Plan ("ESOP") and the Plan shall equal to 1.5 percent of the
Shares outstanding on 31 December 1996, with such determination being made
before such allocation.
2. Aggregate International Base Compensation and Aggregate US Base
Compensation. Aggregate International Base Compensation shall equal the
sum of the Annualized Base Compensation (converted to US dollars) for each
individual who is an International Eligible Employee on 31 December 1996.
The Aggregate US Base Compensation shall equal the sum of the Annualized
Base Compensation for each individual who is a US Eligible Employee on 31
December 1996. Total Aggregate Base Compensation shall be the sum of the
Aggregate International Base Compensation and the Aggregate US Base
Compensation.
3. Allocation Between Plans. The portion of the 1996 Total Allocation shall
be divided into the International Portion and the US Portion, as follows:
(a) first, shares having a value equal to 1 percent of Aggregate
International Compensation shall be allocated to the International
Portion; and
(b) next, the remainder of the 1996 Total Allocation shall be allocated
to the International Portion and the US Portion in the proportions
represented by Aggregate International Compensation and Aggregate US
Compensation, respectively.
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Page 19
4. Award to International Eligible Employees Under this Plan. The
International Portion shall be allocated to International Eligible
Employees under this Plan in accordance with Rule 2.2(a) hereof.
5. Restricted Share Bonus Award to US Eligible Employees. The Awards to US
Employees under this Plan shall be determined as follows:
(a) for each US Eligible Employee, determine the amount of Award, based
on the US Portion (as determined above) that would be provided under
the ESOP, without regard to the limitations imposed by Section 415
of the Code;
(b) for each US Eligible Employee, determine the amount of award, based
on the US Portion (as determined above) that would be provided under
the ESOP, after application of the limitations by Section 415 of the
Code; this amount shall be awarded under the ESOP to such
individuals;
(c) the difference between (a) and (b) above shall be awarded to each
Eligible Employee under this Plan.
Exhibit 5.1
<PAGE>
August 8, 1997
Covance Inc.
210 Carnegie Center
Princeton, New Jersey 08540
Re: Covance Inc.
Restricted Share Plan
Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
I am issuing this opinion in my capacity as General Counsel of Covance
Inc., a Delaware corporation (the "Company"), in connection with the
registration by the Company under the Securities Act of 1933, as amended (the
"Securities Act"), of the Company's Common Stock, par value $.01 per share (the
"Common Stock"), on a Registration Statement on Form S-8 (the "Registration
Statement"). The Registration Statement relates to the issuance of 343,428
shares of Common Stock pursuant to the Covance Inc. Restricted Share Plan (the
"Plan Common Stock") comprising an employee benefit plan (the "Plan").
Capitalized terms used and not otherwise defined herein shall have the meanings
ascribed to them in the Registration Statement.
As such counsel, I have made such legal and factual examinations and
inquiries as I have deemed advisable for the purpose of rendering this opinion.
Based upon the foregoing, it is my opinion that the Plan Common Stock is validly
issued, and after the satisfaction of the vesting requirements as set forth in
the Plan, will be fully paid and non-assessable.
The opinions contained herein relate solely to the Delaware General
Corporation Law, and I express no opinion herein concerning the laws of any
other jurisdiction. This opinion is rendered to the Company in connection with
the filing by the Company of the Registration Statement with the Securities and
Exchange Commission pursuant to the Securities Act and is solely for the benefit
of the Company in connection with such filing. The opinions expressed herein may
not be used or relied on by any other person, nor may this letter or any copies
thereof be furnished to a third party, filed with a government agency, quoted,
cited or otherwise referred to without our prior written consent, except as
noted below.
<PAGE>
August 8, 1997
Page 2
I hereby consent to the reference to myself under the caption "Legal
Matters" in the prospectus included in the Registration Statement. I hereby
consent to the filing of this opinion as Exhibit 5.1 to the Registration
Statement.
Very truly yours,
By: /s/ Jeffrey S. Hurwitz
-----------------------
Jeffrey S. Hurwitz
Corporate Senior Vice President,
General Counsel and
Secretary
Exhibit 23.1
<PAGE>
August 8, 1997
Consent of Independent Accountants
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 27, 1997, appearing on page 39
of Covance Inc.'s 1996 Annual Report on Form 10-K for the fiscal year ended
December 31, 1996.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
