As filed with the Securities and Exchange Commission on July 31, 1998
Registration No. 333-_________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
POST-EFFECTIVE AMENDMENT NO. 1 ON FORM S-8
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933*
INTERNATIONAL SPECIALTY PRODUCTS INC.
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 51-0376469
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization
818 WASHINGTON STREET
WILMINGTON, DELAWARE 19801
(302) 428-0847
(Address, Including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
INTERNATIONAL SPECIALTY PRODUCTS INC.
1991 INCENTIVE PLAN FOR KEY EMPLOYEES AND DIRECTORS, AS AMENDED
(Full Title of Plan)
RICHARD A. WEINBERG, ESQ.
C/O ISP MANAGEMENT COMPANY, INC.
1361 ALPS ROAD, WAYNE, NEW JERSEY 04740
(973) 628-3000
(Name and Address, Including Zip Code,
and Telephone Number, Including Area Code, of Agent For Service)
Copies to:
STEPHEN E. JACOBS, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 FIFTH AVENUE, NEW YORK, NEW YORK 10153
(212) 310-8000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Title of Each Class of Securities to be Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Registered(1) Offering Price Per Aggregate Offering Registration Fee
Share(2) Price(2)
- - ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.01 per share 8,387,855 shares (3) $16.75 $114,498,762 $33,778
====================================================================================================================================
</TABLE>
(1) Plus such indeterminate number of shares of common stock of the Registrant
as may be issued to prevent dilution resulting from stock dividends, stock
splits or similar transactions in accordance with Rule 416 under the
Securities Act of 1933.
(2) Estimated pursuant to Rule 457(h) and Rule 457(c) under the Securities Act
of 1933, based upon the average of the high and low sales prices of the
Registrant's common stock on the New York Stock Exchange on July 29, 1998.
(3) Represents the registration of shares of common stock issuable under the
International Specialty Products Inc. 1991 Incentive Plan for Key
Employees and Directors, as amended (the "Plan"), pursuant to the exercise
of options that have been or may be granted under the Plan.
*This Post-Effective Amendment No. 1 covers 8,387,855 shares of the Registrant's
common stock, of which 1,552,108 shares were originally registered on the
Registration Statement on Form S-4, Registration No. 333-53709 (the "Form S-4
Registration Statement"), to which this is an amendment. The registration fee
with respect to the 1,552,108 shares of common stock originally registered on
the Form S-4 Registration Statement was paid at the time of the original filing
of the Form S-4 Registration Statement. Accordingly, the registration fee has
been calculated based on the additional 6,835,747 shares being registered that
are reserved for issuance under the Plan.
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EXPLANATORY NOTE
On July 15, 1998, International Specialty Products Inc. ("Old ISP") merged
(the "Merger") with and into ISP Holdings Inc., which was the surviving
corporation in the Merger and was renamed International Specialty Products Inc.
("New ISP" or the "Company"). Upon consummation of the Merger, New ISP assumed
Old ISP's 1991 Incentive Plan for Key Employees and Directors, as amended (the
"Plan"). At such time, by virtue of the Merger, all outstanding stock options
granted pursuant to the Plan became exercisable for shares of common stock of
New ISP, par value $.01 per share ("Common Stock"), at the same prices and on
the same terms and conditions as such options would have been exercisable for
Old ISP common stock immediately prior to the Merger.
Accordingly, New ISP hereby amends its Registration Statement on Form S-4
(No. 333-53709), which previously was declared effective and which only
registered 1,552,108 shares of Common Stock that have been or may be issued
under the Plan, by filing this Post-Effective Amendment No. 1 on Form S-8
relating to 8,387,855 shares of Common Stock of New ISP issuable upon the
exercise of options which have been or may be granted pursuant to the Plan.
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PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents containing the information specified in Part I of Form S-8
and the statement of availability of information required by Item 2 of Form S-8
and information relating to the Plan and other information required by Item 2 of
Form S-8 have previously been, or will be, sent or given to plan participants as
specified by Rule 428(b)(1) of the Securities Act of 1933, as amended (the
"Securities Act"). Such documents are not required to be and are not filed with
the Securities and Exchange Commission (the "Commission") either as part of this
Registration Statement or as prospectuses or prospectus supplements pursuant to
Rule 424. These documents and the documents incorporated by reference in this
Registration Statement pursuant to Item 3 of Part II of this Form S-8, taken
together, constitute a prospectus that meets the requirements of Section 10(a)
of the Securities Act.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Commission by Old ISP and New ISP
pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), are incorporated by reference in this Post-Effective Amendment No. 1 on
Form S-8 to the Company's Registration Statement on Form S-4 (No. 333-53709):
1. Old ISP's Annual Report on Form 10-K, as amended, for the fiscal year
ended December 31, 1997;
2. Old ISP's Current Report on Form 8-K filed on April 1, 1998;
3. Old ISP's Quarterly Report on Form 10-Q for the quarter ended March
29, 1998;
4. New ISP's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997; and
5. New ISP's Quarterly Report on Form 10-Q for the quarter ended March
29, 1998.
All documents subsequently filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment to this Registration Statement 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 of such documents. Any statement contained in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this Post-Effective Amendment No. 1 on Form S-8 to
the Company's Registration Statement on Form S-4 to the extent that a statement
contained herein or in any other subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Post-Effective
Amendment No. 1 on Form S-8.
ITEM 4. DESCRIPTION OF SECURITIES.
COMMON STOCK
The Amended and Restated Certificate of Incorporation of the Company
authorizes 300,000,000 shares of Common Stock. The holders of Common Stock are
entitled to one vote for each share held by them on all matters submitted for
approval by the stockholders of the Company. The holders of Common Stock do not
have cumulative voting rights in the election of directors. The holders of
Common Stock are entitled to receive and to share equally in dividends as may be
declared from time to time by the Board of Directors out of funds legally
available therefor. In the event of liquidation, dissolution or winding up of
the Company, the holders of Common Stock are entitled to receive, after payment
of all its debts and liabilities and other payments to holders of any Preferred
Stock having priority rights, if any, all of the assets of the Company available
for distribution to the holders of Common Stock. The Common Stock has no
preemptive rights, conversion rights or other subscription rights.
The transfer agent and registrar for the Common Stock is The Bank of New
York.
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ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is a Delaware corporation. Subsection (b)(7) of Section 102 of
the Delaware General Corporation Law (the "DGCL") enables a corporation in its
original certificate of incorporation or an amendment thereto to eliminate or
limit the personal liability of a director to the corporation or its
stockholders for monetary damages for violations of the director's fiduciary
duty, except (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 174 of the DGCL (providing for liability of directors for
unlawful payment of dividends or unlawful stock purchases or redemptions) or
(iv) for any transaction from which a director derived an improper personal
benefit. Article SEVENTH of the Company's Amended and Restated Certificate of
Incorporation provides that directors and officers shall not be personally
liable to the corporation or its stockholders for monetary damages if a director
or officer acts in good faith and in a manner he reasonably believes to be in or
not opposed to the best interests of the Company and provides for
indemnification of the officers and directors of the Company to the full extent
permitted by applicable law.
Subsection (a) of Section 145 of the DGCL empowers a corporation to
indemnify any director or officer, or former director or officer, who was or is
a 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 corporation) by
reason of the fact that such person is or was a director or officer of the
corporation or is or was serving at the request of the corporation 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 in connection with such action, suit or proceeding provided that such
director or officer acted in good faith in a manner reasonably believed to be
in, or not opposed to, the best interests of the corporation, and, with respect
to any criminal action or proceeding, provided further that such director or
officer has no reasonable cause to believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
director or officer, or former director or officer, 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 acted in any of the capacities set forth
above, against expenses (including attorneys' fees) actually and reasonably
incurred in connection with the defense or settlement of such action or suit
provided that such director or officer acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
corporation, except that no indemnification may be made in respect of any claim,
issue or matter as to which such director or officer shall have been adjudged to
be liable to the corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that despite the adjudication of liability but in view of all
of the circumstances of the case, such director or officer is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
Section 145 further provides that (i) to the extent a director or officer
of a corporation has been successful in the defense of any action, suit or
proceeding referred to in subsections (a) and (b) or in the defense of any
claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith; and (ii) indemnification and advancement of expenses
provided for, by, or granted pursuant to, Section 145 shall not be deemed
exclusive of any other rights to which the indemnified party may be entitled. In
addition, Section 145 empowers the corporation to purchase
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and maintain insurance on behalf of any person who is or was a director or
officer of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against any liability
asserted against him or incurred by him in any such capacity, or arising out of
his status as such, whether or not the corporation would have the power to
indemnify him against such liabilities under Section 145.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 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 Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the 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 Act and will be governed by the final adjudication of
such issue.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit
Number Description
------ -----------
* 4.1 Amended and Restated Certificate of Incorporation of the
Company.
4.2 By-Laws of the Company (incorporated by reference to Exhibit
99.2 to the Registration Statement on Form S-4 of the
Company (Registration No. 333-53709)).
* 4.3 International Specialty Products Inc. 1991 Incentive Plan
for Key Employees and Directors, as amended.
* 5 Opinion of Weil, Gotshal & Manges LLP regarding the validity
of the securities being registered.
* 23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Weil, Gotshal & Manges LLP (included in Exhibit
5).
- - ------------------------------
* Filed herewith
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<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
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 this Registration Statement. Notwithstanding
the foregoing, any increase or decrease in the 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 and
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
percent change in the maximum aggregate offering price
set forth in the "Calculation of Registration Fee"
table in the effective 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 the undertakings set forth in
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 this 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 that is incorporated by reference in this
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 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
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
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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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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
Post-Effective Amendment to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the Township of Wayne,
State of New Jersey, on July 31, 1998.
INTERNATIONAL SPECIALTY PRODUCTS INC.
By: /s/ Richard A. Weinberg
-------------------------------------------
Name: Richard A. Weinberg
Title: Executive Vice President and
General Counsel
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this
Post-Effective Amendment to the Registration Statement has been signed by the
following persons in the capacities and on the dates indicated. Each person
whose name appears below hereby constitutes James P. Rogers such person's true
and lawful attorney, with full power of substitution to sign for such person and
in such person's name and capacity indicated below, any and all amendments to
this Registration Statement, and to file the same with the Securities and
Exchange Commission, hereby ratifying and confirming such person's signature as
it may be signed by said attorney to any and all amendments.
Signature Title Date
- - --------- ----- ----
/s/ Samuel J. Heyman Chairman, Chief Executive July 31, 1998
- - -------------------------- Officer and Director
Samuel J. Heyman (Principal Executive Officer)
/s/ Peter R. Heinze President, Chief Operating July 31, 1998
- - -------------------------- Officer and Director
Peter R. Heinze
/s/ Randall R. Lay Vice President and Chief July 31, 1998
- - -------------------------- Financial Officer
Randall R. Lay (Principal Financial and
Accounting Officer)
/s/ Carl R. Eckardt Executive Vice President- July 31, 1998
- - -------------------------- Corporate Development and
Carl R. Eckardt Director
Director July __, 1998
- - --------------------------
Charles M. Diker
/s/ Harrison J. Goldin Director July 31, 1998
- - --------------------------
Harrison J. Goldin
/s/ Sanford Kaplan Director July 31, 1998
- - --------------------------
Sanford Kaplan
<PAGE>
Director July __, 1998
- - --------------------------
Burt C. Manning
<PAGE>
EXHIBIT INDEX
Number Description
------ -----------
* 4.1 Amended and Restated Certificate of Incorporation of the
Company.
4.2 By-Laws of the Company (incorporated by reference to Exhibit
99.2 to the Registration Statement on Form S-4 of the
Company (Registration No. 333-53709)).
* 4.3 International Specialty Products Inc. 1991 Incentive Plan
for Key Employees and Directors, as amended.
* 5 Opinion of Weil, Gotshal & Manges LLP regarding the validity
of the securities being registered.
* 23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Weil, Gotshal & Manges LLP (included in Exhibit
5).
- - ------------------------------
* Filed herewith
Exhibit 4.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
INTERNATIONAL SPECIALTY PRODUCTS INC.
FIRST: The name of the corporation (the "Corporation") is International
Specialty Products Inc.
SECOND: The address of the registered office of the Corporation in the
State of Delaware is 1013 Centre Road, City of Wilmington, County of New Castle,
State of Delaware. The name of the registered agent of the Corporation in the
State of Delaware at such address is The Prentice-Hall Corporation System, Inc.
THIRD: The purpose of the Corporation is to engage in any lawful act or
activity for which corporations may be organized under the General Corporation
Law of the State of Delaware, as from time to time amended.
FOURTH: The total number of shares of all classes of stock which the
Corporation shall have authority to issue is 320,000,000 shares, consisting of
(a) 20,000,000 shares of Preferred Stock, par value $.01 per share, and
(b) 300,000,000 shares of Common Stock, par value $.01 per share.
Except as otherwise provided by law, the shares of stock of the
Corporation, regardless of class, may be issued by the Corporation from time to
time in such amounts, for such consideration and for such corporate purposes as
the Board of Directors may from time to time determine.
Shares of Preferred Stock may be issued from time to time in one or more
series of any number of shares as may be determined from time to time by the
Board of Directors, provided that the aggregate number of shares issued and not
cancelled of any and all such series shall not exceed the total number of shares
of Preferred Stock authorized by this Certificate of Incorporation. Each series
of Preferred Stock shall be distinctly designated. Except in respect of the
particulars fixed for series by the Board of Directors as permitted hereby, all
shares shall be alike in every particular, except that shares of any one series
issued at different times may differ as to the dates from which dividends
thereon shall be cumulative. The voting powers, if any, of
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each such series and the preferences and relative, participating, optional and
other special rights of each such series and the qualifications, limitations and
restrictions thereof, if any, may differ from those of any and all other series
at any time outstanding; and the Board of Directors is hereby expressly granted
authority to fix, in the resolution or resolutions providing for the issue of a
particular series of Preferred Stock, the voting powers, if any, of each such
series and the designations, preferences and relative, participating, optional
and other special rights of each such series and the qualifications, limitations
and restrictions thereof to the full extent now or hereafter permitted by this
Certificate of Incorporation and the laws of the State of Delaware.
Subject to the provisions of applicable law or of the By-laws with respect
to the closing of the transfer books or the fixing of a record date for the
determination of stockholders entitled to vote, and except as otherwise provided
by law or by the resolution or resolutions providing for the issue of any series
of Preferred Stock, the holders of outstanding shares of Common Stock shall
exclusively possess the voting power for the election of directors and for all
other purposes, each holder of record of shares of Common Stock being entitled
to one vote for each share of Common Stock standing in his name on the books of
the Corporation.
No holder of any of the shares of any class or series of stock or of
options, warrants or other rights to purchase shares of any class or series of
stock or of other securities of the Corporation shall have any preemptive right
to purchase or subscribe for any unissued stock of any class or series or any
additional shares of any class or series to be issued by reason of any increase
of the authorized capital stock of the Corporation of any class or series, or
bonds, certificates of indebtedness, debentures or other securities convertible
into or exchangeable for stock of the Corporation of any class or series, or
carrying any right to purchase stock of any class or series, but any such
unissued stock, additional authorized issue of shares of any class or series of
stock or securities convertible into or exchangeable for stock, or carrying any
right to purchase stock, may be issued and disposed of pursuant to a resolution
of the Board of Directors to such persons, firms, corporations or associations,
whether such holders or others, and upon such terms, as may be deemed advisable
by the Board of Directors in the exercise of its sole discretion.
FIFTH: In furtherance and not in limitation of the powers conferred by
law, subject to any limitations contained elsewhere in these articles of
incorporation, by-laws of the Corporation may be adopted, amended or repealed by
a majority of the board of directors of the Corporation, but any by-laws adopted
by the board of
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directors may be amended or repealed by the stockholders entitled to vote
thereon. Election of directors need not be by written ballot.
SIXTH: As provided by Section 203(b)(1) of the General Corporation Law of
the State of Delaware, the Corporation expressly elects not to be governed by
Section 203 of the General Corporation Law.
SEVENTH: (a) No person shall be liable to the Corporation for any loss or
damage suffered by it on account of any action taken or omitted to be taken by
him as a director or officer of the Corporation if he acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best interests of
the Corporation, or, with respect to any criminal matter, had no reasonable
cause to believe his conduct was unlawful.
(b) Subject to Section (e) of this Article SEVENTH, the Corporation shall
indemnify any person who was or is a 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 Corporation), by reason of the fact that he is or was a
director, officer or employee of the Corporation, or is or was serving at the
request of the Corporation, as a director, officer or employee 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 he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(c) Subject to Section (e) of this Article SEVENTH, the Corporation shall
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 he
is or was a director, officer or employee of the Corporation, or is or was
serving at the request of the Corporation as a director, officer or employee of
another corporation,
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partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Corporation; except that no indemnification shall be made
in respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the Corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought shall
determine upon application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
(d) In addition to the foregoing, subject to Section (e) of this Article
SEVENTH, the Corporation shall indemnify, to the fullest extent permitted by
law, 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 he is
or was a director, officer or employee of the Corporation, or is or was serving
at the request of the Corporation as a director, officer or employee of another
corporation, partnership, joint venture, trust or other enterprise against
judgments, fines and amounts paid in settlement actually incurred by him in
connection with such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation.
(e) Any indemnification under this Article SEVENTH (unless ordered by a
court) shall be made by the Corporation upon a determination that
indemnification of the director, officer or employee is proper in the
circumstances because he has met the applicable standard of conduct set forth in
Sections (b), (c) or (d) of this Article SEVENTH, as the case may be. Such
determination shall be made (i) by the Board of Directors by a majority vote of
a quorum consisting of directors who were not parties to such action, suit or
proceeding, or (ii) 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 (iii) by the stockholders. To the extent, however, that such
director, officer or employee of the Corporation has been successful on the
merits or otherwise in defense of any action, suit or proceeding described
above, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith, without the necessity of authorization
in the specific case.
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(f) For purposes of any determination under Section (a) or (e) of this
Article SEVENTH, a person shall be deemed to have acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Corporation, or, with respect to any criminal action or proceeding, to have
had no reasonable cause to believe his conduct was unlawful, if his action is
based on the records or books of account of the Corporation or another
enterprise, or on information supplied to him by the officers of the Corporation
or another enterprise in the course of their duties, or on the advice of legal
counsel for the Corporation or another enterprise or on information or records
given or reports made to the Corporation or another enterprise by an independent
certified public accountant or by an appraiser or other expert selected with
reasonable care by the Corporation or another enterprise. The term "another
enterprise" as used in this Section (f) shall mean any other corporation or any
partnership, joint venture, trust or other enterprise of which such person is or
was serving at the request of the Corporation as a director, officer or
employee. The provisions of this Section (f) shall not be deemed to be exclusive
or to limit in any way the circumstances in which a person may be deemed to have
met the applicable standard of conduct set forth in Sections (b), (c) or (d) of
this Article SEVENTH, as the case may be.
(g) Notwithstanding any contrary determination under Section (e) of this
Article SEVENTH, and notwithstanding the absence of any determination
thereunder, any director, officer or employee of the Corporation or of another
corporation, partnership, joint venture, trust or other enterprise who is or was
serving at the request of the Corporation may apply to any court of competent
jurisdiction in the State of Delaware for indemnification to the extent
otherwise permissible under Sections (b), (c) or (d) of this Article SEVENTH.
The basis of such indemnification by a court shall be a determination by such
court that indemnification of the director, officer or employee is proper in the
circumstances because he has met the applicable standards of conduct set forth
in Sections (b), (c) or (d) of this Article SEVENTH, as the case may be. Notice
of any application for indemnification pursuant to this Section (g) shall be
given to the Corporation promptly upon the filing of such application.
(h) Expenses incurred in defending or investigating a threatened or
pending action, suit or proceeding may be paid by the Corporation in advance of
the final disposition of such action, suit or proceeding as authorized by the
Board of Directors upon receipt of an undertaking by or on behalf of the
director, officer or employee to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the Corporation as
authorized in this Article SEVENTH.
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(i) The indemnification provided by this Article SEVENTH shall not be
deemed exclusive of any other rights to which those seeking indemnification may
be entitled under this certificate of incorporation, any By-law, agreement,
contract, vote of stockholders or disinterested directors or pursuant to the
direction (howsoever embodied) of any court of competent jurisdiction or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding official capacity and as to action in another
capacity while holding office, it being the policy of the Corporation that
indemnification of the persons specified in Sections (a), (b) or (c) of this
Article SEVENTH shall be made to the fullest extent permitted by law. The
provisions of this Article SEVENTH shall not be deemed to preclude the
indemnification of any person who is not specified in Sections (a), (b) or (c)
of this Article SEVENTH, but whom the Corporation has the power or obligation to
indemnify under the provisions of the General Corporation Law of the State of
Delaware, or otherwise. The indemnification provided by this Article SEVENTH
shall continue as to a person who has ceased to be a director, officer or
employee and shall inure to the benefit of the heirs, executors and
administrators of such person.
(j) The Corporation may purchase and maintain insurance on behalf of any
person who is or was a director, officer or employee of the Corporation, or is
or was serving at the request of the Corporation as a director, officer or
employee of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Corporation would have the power or the obligation to indemnify him against such
liability under the provisions of this Article SEVENTH.
(k) For purposes of this Article SEVENTH, references to "the Corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers and employees
so that any person who is or was a director, officer or employee of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer or employee of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under the provisions of this Article SEVENTH with respect to the
resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
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EIGHTH: The name and address of the original incorporator of the
Corporation are Shelley A. Sorkin, c/o ISP Management Company Inc., 1361 Alps
Road, Wayne, New Jersey 07470.
7
Exhibit 4.3
INTERNATIONAL SPECIALTY PRODUCTS INC.
1991 INCENTIVE PLAN FOR KEY EMPLOYEES
AND DIRECTORS, AS AMENDED
1. PURPOSE OF THE PLAN.
The purpose of the plan is to secure for International Specialty Products
Inc. (the "Corporation") and its stockholders the benefits of the incentive
inherent in common stock ownership by Key Employees and Eligible Directors of
the Corporation and its subsidiaries who will be largely responsible for the
Corporation's future growth and continued financial success. The Plan is
intended to furnish a component of a modern compensation program to attract,
retain and stimulate capable persons by creating the incentives for maximum
personal involvement in the Corporation's fortunes.
The stock options (the "Option" or "Options") and awards of restricted
shares (the "Restricted Shares") and unrestricted shares of common stock offered
pursuant to the Plan are a matter of separate inducement and are not in lieu of
any salary or other compensation for the services of any Key Employee or
Eligible Director participating in the Plan.
It is intended that an Option granted under the Plan may be either an
incentive stock option within the meaning of Section 422 of the Internal Revenue
Code of 1986, as the same may be amended from time to time (the "Code") (a
"Qualified Option"), or an Option which is not a qualified option (a
"Non-qualified Option"), but the Corporation makes no warranty as to the
qualification of any Option as a Qualified Option.
2. DEFINITIONS.
Capitalized terms used herein not otherwise defined have the following
meanings:
(a) Change in Control of the Company is deemed to have occurred if the
executive officers of the Company as of June 28, 1991, either directly or
through one of their
NYFS01...:\01\47201\0035\1909\PLN7278X.000
<PAGE>
affiliates, cease to have, in the aggregate, directly or indirectly, at least
20% of the voting power of the Company.
(b) Committee means a Committee of the Board of Directors of the
Corporation, which has been appointed by the Board of Directors of the
Corporation (the "Board") to administer the Plan and perform the functions set
forth herein for the Committee, among other things. The Committee shall be
composed of three or more members of the Board, all of whom shall be
"disinterested persons" within the meaning of 17 C.F.R. ss. 240.16b-3 of the
Regulations issued under the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
(c) Common Stock means the Common Stock of the Corporation, par value $.01
per share, and any other stock or securities resulting from the adjustment
thereof or substitution therefor as described in Section 16 below.
(d) Disability means the condition which results when an individual has
become permanently and totally disabled within the meaning of Section 22(e)(3)
of the Code.
(e) Eligible Director means a director of the Corporation who is not an
officer or employee of the Corporation, a Subsidiary or a Parent (but includes a
former officer or former employee thereof).
(f) Fair Market Value, as of any date means: (i) in the event the Common
Stock is listed on a national securities exchange, the closing price as reported
for composite transactions on the date, or, if no sales occurred on that date,
then the closing price on the next preceding date on which such sales of Common
Stock occurred; (ii) in the event the Common Stock is not listed on a national
securities exchange, the mean between the high bid and the low asked prices
reported for shares of Common Stock traded over-the-counter on that date, or, if
no bid and asked prices were reported on that date, then the mean between the
high bid and low asked prices on the next preceding date on which such prices
were reported; or (iii) in the event there are no over-the-counter prices for
the Common Stock and it is not listed on a national securities exchange, the
fair market value determined by the Committee either on the basis of the
available price of the Common Stock or in such other manner as the Committee may
deem reasonable.
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<PAGE>
(g) Key Employee means a regular employee of the Corporation, a Subsidiary
or a Parent, who, is an officer or holds a managerial or other key position, as
determined by the Committee, and who, in the opinion of the Committee, has
demonstrated a capacity for making a substantial contribution to the success of
the business of the Corporation, a Subsidiary or a Parent.
(h) Over-Ten-Percent Shareholder means a Key Employee who, at the time an
option is to be granted to him, owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Corporation, its Parent or
a Subsidiary, within the meaning of Section 422(b)(6) of the Code.
(i) Parent means a parent corporation of the Corporation within the
meaning of Section 424(e) of the Code.
(j) Plan means the International Specialty Products Inc. 1991 Incentive
Plan for Key Employees and Directors, as amended, as set forth in this
instrument and as it may be amended from time to time.
(k) Stock Option Agreement or the Agreement means the written agreement
between a Key Employee or Eligible Director and the Corporation evidencing the
grant of an option under the Plan and setting forth the terms and conditions of
that grant.
(l) Subsidiary means a subsidiary corporation of the Corporation within
the meaning of Section 424(f) of the Code.
(m) Successor Corporation means a corporation, or a Parent or Subsidiary
corporation of such corporation, within the meaning of Section 424(e) or (f) of
the Code, which issues or assumes a stock option in a transaction to which
Section 424(a) of the Code applies.
3. ADMINISTRATION OF THE PLAN.
The Plan shall be administered by the Committee. The Committee shall keep
minutes of its meetings. A majority of the Committee shall constitute a quorum,
and the acts of a majority of the members present at any meeting at which there
is a quorum, or acts approved in writing by the unanimous consent of its
members, shall be the acts of the Committee.
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<PAGE>
The Committee is authorized, subject to the provisions of the Plan, to
adopt, amend and rescind such rules and regulations as it may deem appropriate
for the administration of the Plan and to make such determinations and
interpretations which it deems consistent with the Plan's provisions. The
Committee's determinations and interpretations shall be final and conclusive.
In no event will a Key Employee or an Eligible Director who is subject to
the reporting requirements of Regulations 17 C.F.R. ss. 240.16b-3 of the
Exchange Act be entitled to sell or otherwise dispose of any shares acquired
pursuant to any Options for a period of six (6) months from the date of the
acquisition of such Options.
4. OFFERS TO SELL SHARES.
During the period this Plan remains in force, Key Employees shall be
eligible to receive shares of Common Stock. The Corporation, a Subsidiary, or a
Parent may, pursuant to Sections 7 and 8 hereof, offer to sell shares of Common
Stock to such of their respective Key Employees as shall be designated from time
to time by the Committee, on the terms, conditions and restrictions set forth in
this Plan and such other and additional terms, conditions and restrictions not
inconsistent therewith as may be determined by the Committee. Such an offer
shall not be transferable, and any attempt to transfer the offer shall be void
and of no effect.
The aggregate number of shares of Common Stock which may be sold under the
Plan shall not exceed one million. In the event that the number of outstanding
shares of Common Stock shall be changed by reason of one or more split-ups or
combinations of shares or recapitalizations or stock dividends, the number of
shares which may thereafter be offered for sale under the Plan shall be
appropriately adjusted as determined by the Committee so as to reflect such
change or changes. No adjustment provided for in this Section 4 shall require
the Corporation to issue a fractional share.
5. GRANTING OF OPTIONS TO KEY EMPLOYEES.
In addition to Section 4 hereof, Key Employees shall be eligible to
receive Options under the Plan. Subject to Section 16 of the Plan, the shares to
be optioned under the Plan shall be shares of the Corporation's Common Stock,
and may be authorized but unissued shares or shares issued and
4
<PAGE>
reacquired by the Corporation and held in its treasury, as the Committee may
from time to time determine. The aggregate number of shares for which Options
may be granted under the Plan shall be five million.
The number of shares subject to the Plan, the number of shares subject to
outstanding Options and the Option price of such outstanding Options shall be
appropriately adjusted, in any reasonable manner determined by the Committee, to
reflect any future stock dividends, split-ups, reorganizations,
recapitalizations or other substitutions of securities of the Corporation for
the present Common Stock. The Committee's adjustment shall be effective and
binding for all purposes of the Plan and each Stock Option Agreement entered
into under the Plan. No adjustment or substitution provided for in this Section
5 shall require the Corporation to issue a fractional share.
Except to the extent otherwise provided under the Code, to the extent that
the aggregate fair market value of stock for which Qualified Options are
exercisable for the first time by a Key Employee during any calendar year (under
all stock option plans of the Corporation and of any Parent or Subsidiary)
exceeds one hundred thousand dollars ($100,000), such Options shall be treated
as Non-qualified Options. For purposes of this limitation, (i) the fair market
value of stock is determined as of the time the Option is granted and (ii) the
limitation will be applied by taking into account Options in the order in which
they were granted.
Shares subject to and not delivered under an Option which (i) expires or
terminates or (ii) is relinquished pursuant to Section 6 of the Plan during the
term of the Plan shall again be available for Option under the Plan. If all or
any portion of an Option is surrendered pursuant to Section 13 of the Plan, the
shares covered thereby shall not thereafter be available for the granting of
other Options under the Plan.
6. ELIGIBILITY AND SELECTION OF KEY EMPLOYEES.
Shares of Common Stock may be offered for sale under the Plan only to Key
Employees. The sale of shares of Common Stock to a Key Employee shall not
preclude subsequent sales to the same Key Employee. Nor shall any sale of shares
to a Key Employee pursuant to either Sections 7 or 8 hereof preclude sales of
shares pursuant to the other Section to the same Key Employee at the same time
or at any other time.
5
<PAGE>
Subject to the provisions of the Plan, the Committee may, from time to
time, designate the Key Employees to whom shares of Common Stock may be offered
for sale, may determine whether such shares are to be offered without
restrictions as to disposition pursuant to Section 7 hereof, or subject to
restrictions as to disposition pursuant to section 8 hereof, may determine the
time or time when such shares may be offered for sale, the number of such shares
to be offered for sale to each Key Employee at each time and, subject to the
provisions of Sections 7 and 8 hereof, the price thereof, and may prescribe the
form of instruments, including, without limitation, instruments evidencing
offers to sell and agreements to purchase shares under the Plan, and the form of
the legend or legends, if any, to be imprinted on the stock certificates, if
any, representing shares sold under the Plan.
Subject to the provisions of the Plan, the Committee shall have full
authority in its discretion to determine those Key Employees to whom Options
shall be granted and in each case the number of shares to be subject to such
Option, the date on which it is to be granted, the Option price at which shares
covered thereby may be purchased (subject, however, to Section 9 of the Plan),
whether it is intended to be a Qualified Option or a Non-qualified Option, and
the other terms thereof; provided that no single Key Employee may be granted
Options for more than 150,000 shares of Common Stock during any calendar year.
Each Option shall be evidenced by a Stock Option Agreement containing
terms and conditions established by the Committee and consistent with the
provisions of the Plan. The terms and conditions of Options may differ. If the
Committee grants Options intended to be Qualified Options, the Agreement shall
contain such terms and provisions as may in the Committee's judgment be
necessary to render them incentive stock options within the meaning of Section
422(b) of the Code.
Any person may be granted additional Options, or may relinquish an Option
or Options and be granted one or more other Options, including Options
exercisable at prices lower than those of the relinquished Options, as the
Committee may determine.
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<PAGE>
7. PRICE AND PURCHASE OF UNRESTRICTED SHARES.
If the Committee shall designate a Key Employee as one to whom shares of
Common Stock without restrictions as to disposition may be offered, the purchase
price per share of such shares shall be determined by the Committee.
A Key Employee so designated by the Committee to whom an offer is made by
his employer corporation to sell shares of Common Stock without restrictions
shall have a period, to be fixed by the Committee in each instance, terminating
not later than sixty days after the date on which such employee was so
designated, within which such employee may give written notice to such employer
corporation of his election to purchase the shares offered. At or before the
time of purchase of such shares, the Key Employee shall pay the full purchase
price in cash or as otherwise permitted by the Committee pursuant to Section 15
hereof, and shall agree in writing that the Plan shall not be deemed to confer
any right upon the employee to remain in the employ of the Corporation, a Parent
or of any of its Subsidiaries.
8. PRICE AND PURCHASE OF RESTRICTED SHARES.
If the Committee shall designate a Key Employee to whom Restricted Shares
of Common Stock subject to restrictions as to disposition may be offered, the
purchase price per share of such shares shall be determined by the Committee.
Restricted Shares so offered shall be subject to the restrictions and conditions
set forth in Section 10 hereof, and to any additional restrictions and
conditions as the Committee shall specify at the time it so designates such
employee. The Committee at such time may determine the rate or rates at which
and the circumstances under which the restrictions and conditions imposed upon
such shares shall lapse, which shall not, except as otherwise provided in
Section 10 hereof, be prior to the expiration of one year from the date of
purchase of such shares.
A Key Employee so designated by the Committee to whom an offer is made by
his employer corporation to sell Restricted Shares of Common Stock shall have a
period, to be fixed by the Committee in each instance, terminating not later
than sixty days after the date on which such employee was so designated, within
which such employee may give written notice to such employer corporation of his
election to purchase the shares offered. At or before the time of purchase of
such shares the employee shall pay the full purchase price in cash or as
otherwise permitted by the
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<PAGE>
Committee pursuant to Section 15 hereof, and shall agree in writing (a) that the
Plan shall not be deemed to confer any right upon the employee to remain in the
employ of the Corporation, a Parent or of any of its Subsidiaries, and (b) that
he will observe and comply with all terms, conditions and restrictions to which
the shares purchased by him are subject.
9. KEY EMPLOYEE OPTION PRICE.
The Committee shall establish the Option price at the time an Option is
granted to a Key Employee. The Option price shall not be less than 100% of the
Fair Market Value of the shares of Common Stock subject to the Option on the day
the Option is granted; provided, however, that the option price shall be at
least 110% of the Fair Market Value of the shares of Common Stock subject to any
Qualified Option at the time such Qualified Option is granted, if the Qualified
Option is granted to a Key Employee who is an Over-Ten-Percent Shareholder. In
any event, the Option price shall not be less than the par value of the shares
subject to the Option.
10. RESTRICTIONS AND CONDITIONS ON PURCHASE OF RESTRICTED SHARES.
Restricted Shares of Common Stock purchased by a Key Employee pursuant to
an offer made under Section 8 hereof shall be subject to the following terms,
restrictions and conditions:
(a) Except as expressly permitted in this Section 10, for a period
of one year from the date of purchase and for such further period or
periods as may be provided by the Committee, such shares shall not be
sold, assigned, transferred, pledged, hypothecated or otherwise disposed
of (other than pursuant to Section 15 hereof), and any such sale,
assignment, transfer, pledge, hypothecation or other disposition shall be
void and of no force and effect;
(b) The conditions and restrictions described in Section 10(a)
hereof shall lapse and such shares may be sold, assigned, transferred,
pledged, hypothecated or otherwise disposed of (other than pursuant to
Section 15 hereof) as follows: 20% of such shares after the expiration of
one year from the date of grant; 40% of such shares after the expiration
of two years from the date of grant; 60% of such shares after the
expiration
8
<PAGE>
of three years from the date of grant; 80% of such shares after the
expiration of four years from the date of grant; and 100% of such shares
after the expiration of five years from the date of grant;
(c) Notwithstanding Section 10(b) hereof, at any time after the
expiration of a period of one year from the date of purchase of shares by
an employee, the Committee may authorize a sale, assignment, transfer,
pledge, hypothecation or other disposition of all or part of such shares
free of any restrictions under the Plan if the Committee finds that in its
judgment a case of hardship justifies such authorization;
(d) If a Key Employee shall die before all restrictions imposed upon
the Restricted Shares purchased by him shall lapse, the Committee, in its
discretion, may remove any or all of the then remaining restrictions from
any or all of such shares, effective as of such time or times as the
Committee shall specify; and
(e) If a Key Employee's employment shall terminate for any reason
other than his transfer from the Corporation to a Subsidiary or his
transfer from a Subsidiary to another Subsidiary or to the Corporation,
the Corporation, if such shares were purchased from it, or a Subsidiary or
a Parent, if they were purchased from it,shall have the right, but not the
obligation, to repurchase, at their purchase price, all shares purchased
by the employee which, at the time of termination of employment, remain
subject to the restrictions set forth in this Section 10. Such right shall
be exercisable within ninety (90) days immediately following such
termination of employment. In case such termination is due to the
employee's death or if he dies within ninety (90) days after such
termination which is not due to death, such right shall be exercisable at
any time after such death and prior to the expiration of ninety (90) days
following receipt by the Corporation or the Subsidiary or Parent from
which the Restricted Shares were purchased of written notice of the
appointment of an executor or other personal representative of his estate.
Restricted Shares of Common Stock with respect to which the Corporation or
a Subsidiary or Parent shall have failed to exercise its right to
repurchase shall remain subject to the restrictions imposed by this
Section 10.
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11. EXERCISE OF OPTIONS BY KEY EMPLOYEES. (Amended)
Subject to Section 16 hereof, and except as otherwise provided in this
Section 11, no Option to purchase shares shall be exercisable by a Key Employee
for a period of one year from the date of grant. Thereafter, subject to Section
16 hereof, and except as otherwise provided in this Section 11, shares
originally subject to the Option may be purchased as follows: 20% of such shares
after the expiration of one year from the date of grant; 40% of such shares
after the expiration of two years from the date of grant; 60% of such shares
after the expiration of three years from the date of grant; 80% of such shares
after the expiration of four years from the date of grant; 100% of such shares
after the expiration of five years from the date of grant; provided, however,
that any Qualified Option granted under the Plan to an Over-Ten-Percent
Shareholder shall be exercisable, as to 100% of the shares subject thereto,
after the expiration of four years and ten months from the date of grant, and
provided further that the Committee may, in its discretion, on a case-by-case
basis, grant Options exercisable by a Key Employee, in whole or in part, upon,
and amend each outstanding Option exercisable by a Key Employee to allow the
exercise of such Option, in whole or in part, upon, a Change in Control of the
Corporation. No Option granted under the Plan to a Key Employee shall be
exercisable as to all or any portion of the shares subject to such Option after
the ninth anniversary of the date of grant of such Option, except that no
Qualified Option granted to a Key Employee who is an Over-Ten-Percent
Shareholder shall be exercisable more than five years after the date of grant.
12. LIMITATION ON EXERCISE OF OPTIONS.
In addition to the conditions on exercise of Options described in Section
14 hereof, and notwithstanding any other provision of the Plan, the Committee,
in its discretion and on the terms and conditions set forth in this Section 12
and such other terms and conditions as it deems appropriate, may prohibit
exercise of any or all Options to purchase shares of Common Stock. In the event
that the Committee prohibits the exercise of any Option, the Committee shall
authorize payment of, and the Corporation shall pay, an amount equal to the
excess of Fair Market Value of the shares covered by such Options over the
option price of such shares. Such amount shall be paid in (a) cash, or (b) any
combination of cash and Common Stock, with the form of payment to be at the
election of the Committee; provided, however, in every instance the Committee
shall
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<PAGE>
determine that such payment is consistent with the purposes set forth in Section
1 of the Plan.
13. SURRENDER AND REPURCHASE OF OPTIONS.
A Stock Option Agreement may provide that in the event of any tender or
exchange offer (other than an offer by the Corporation) for shares of Common
Stock, the optionee will have the unconditional right (a "Limited Right") to
surrender all or any portion of such Option (regardless of the extent to which
such Option is then exercisable) during the 30-day period following the date
shares are first purchased or exchanged pursuant to such offer (but without
regard to the number of shares so purchased) and to receive in consideration of
such surrender an amount equal to the excess of the Fair Market Value on the
date of surrender of the shares covered by the surrendered portion of the Option
over the Option price of such shares. Such amount shall be paid in (a) cash, (b)
Common Stock, or (c) any combination of cash and Common Stock, with the form of
payment to be at the election of the Committee; provided, however, that in every
instance the Committee shall determine that such payment is consistent with the
purposes set forth in Section 1 of the Plan. For the purposes of Limited Rights,
the term "Fair Market Value on the date of surrender" shall mean the average of
the Fair Market Value of the shares of Common Stock during the period commencing
on the date the bidder publicly announced its intention to pay the price which
was initially paid for, or the exchange ratio which was initially used for, such
shares first purchased or exchanged and ending on the date on which such shares
were first purchased or exchanged, inclusive.
14. CONDITIONS OF EXERCISE OF OPTIONS.
(a) Options granted under the Plan shall not be transferable by the
optionee except by will, or if the optionee dies intestate, by laws of descent
and distribution of the state of the optionee's domicile at the time of his
death. During an optionee's lifetime, Options granted under the Plan are
exercisable only by the optionee.
(b) Subject to the terms and conditions and within the limitations of the
Plan, the Committee may modify, extend, replace or renew outstanding Options
granted under the Plan, or accept the surrender of outstanding Options (to the
extent they have not yet been exercised) and grant new options in substitution
for them. Notwithstanding the foregoing, however, no modification of an Option
shall
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<PAGE>
adversely alter or impair any rights or obligations under any Option granted
under the Plan without the affected optionee's consent.
(c) If the employment of an optionee by the Corporation, a Parent,
Subsidiary or a Successor Corporation shall terminate for any reason other than
his death or Disability, then each Option held by that optionee on the date of
such termination or the date on which he ceases to be a director, as the case
may be, to the extent then exercisable, may be exercised at any time prior to
the earlier of (i) its expiration date or (ii) the expiration of a ninety (90)
day period following the date of termination of employment. An Option shall not
be affected by any change in the duties or position of an optionee (including
transfer to or from a Parent or Subsidiary) so long as he continues in the
employ of the Corporation or a Subsidiary or Parent or a Successor Corporation.
If the employment of an optionee by the Corporation, a Parent, a Subsidiary or a
Successor Corporation, shall terminate by reason of his death or Disability, or,
in the case of an optionee who is a director but not an employee of the
Corporation, a Parent, a Subsidiary or a Successor Corporation, and such
optionee ceases to be a director of the Corporation, a Parent, a Subsidiary or a
Successor Corporation by reason of his death or Disability, then each Option
held by the optionee on the date of his death or Disability, to the extent then
exercisable, may be exercised, at any time prior to the earlier of (i) its
expiration date or (ii) the expiration of one year following the date of the
optionee's death or Disability, including the date death or Disability occurs.
In the event of an optionee's death, his Options shall be exercisable, to the
extent otherwise provided in the Plan, by the executor or by any other person
who may be empowered to do so under the optionee's will. If the optionee has
failed to make a testamentary disposition of his Options or dies intestate, his
Options shall be exercisable by his legal representative.
(d) Treatment of Options upon termination of service of an Eligible
Director shall be governed by Section 27 hereof.
(e) Each Option shall be confirmed by a Stock Option Agreement which shall
be executed by the Corporation and by the person to whom the Option is granted.
(f) To the extent that an Option is not exercised within the period of
time prescribed by the Plan and the
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Stock Option Agreement confirming the Option, the Option shall lapse and all
rights to the optionee with respect to it shall terminate.
(g) Nothing in the Plan or in the Stock Option Agreement shall confer on
any employee any right to continue in the employ of the Corporation or any
Parent or Subsidiary or Successor Corporation; affect the right of the
Corporation or any Parent or Subsidiary or a Successor Corporation to terminate
his employment at any time; or be deemed a waiver or modification of any
provision contained in any agreement between the employee and the Corporation or
any such Parent or Subsidiary. The Stock Option Agreements may contain such
provisions as the Committee shall approve with reference to the effect of
approved leaves of absence.
15. PAYMENT FOR SHARES.
Unless otherwise permitted by the Committee, payment for any shares of
Common Stock (other than for payment of shares of Common Stock purchased upon
the exercise of an Option as described below) sold under the Plan shall be in
cash and shall be made on or prior to the date on which the shares are sold to
the Key Employee. The Committee, in its discretion, may permit part payment for
the shares, in an amount not exceeding seventy-five percent of the purchase
price thereof, by a promissory note or notes of the Key Employee. In no event
shall the portion of the purchase price payable in cash be less than the par
value of the Common Stock sold to the Key Employee. Any such promissory note
shall bear interest at a rate determined by the Committee, but not less than the
appropriate applicable federal rate, and shall be payable not more than six
years after the date on which the shares are purchased. Any shares for which
part payment is made by any such note or notes shall be pledged with the
Corporation, or with the Subsidiary or Parent by which the shares are sold, as
security for the payment, when due, of interest on and the principal of such
note or notes. The Key Employee or Eligible Director shall not possess any
rights of a stockholder with respect to any shares sold to him under the Plan
prior to the date on which such shares are issued in or transferred into his
name or the name of his nominee.
Payment for shares of Common Stock purchased upon exercise of an Option
granted under the Plan shall be made (except in the case of a surrender pursuant
to Section 13) to the Corporation in cash (including check, bank draft, money
order or wire transfer), or by delivering shares of
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<PAGE>
Common Stock already owned by the Option holder and having an aggregate value
(based on the Fair Market Value of the Common Stock so delivered as of the day
preceding the date of delivery) equal to the Option price of the shares
purchased, or by delivering to the Corporation a combination of such shares and
cash having an aggregate value (based on the Fair Market Value of the Common
Stock so delivered as of the date preceding the date of delivery) equal to the
Option price of the shares purchased. A Key Employee or Eligible Director to
whom an Option is granted shall not be deemed the holder of any shares subject
to the Option or have any rights of a shareholder with respect thereto until the
shares are delivered to him.
16. SOURCE AND NUMBER OF SHARES AND OPTIONS.
As determined by the Board from time to time, shares of Common Stock sold
by the Corporation to its Key Employees shall be either authorized but unissued
shares or shares acquired by the Corporation and held in its treasury. Shares
sold by a Subsidiary or a Parent to its Key Employees shall be acquired by such
subsidiary from the Corporation. Any Restricted Shares of Common Stock
repurchased by the Corporation or any Subsidiary or Parent pursuant to the terms
of Section 10 hereof shall again become available for sale pursuant to the terms
of this Plan.
Upon the effective date of any merger or consolidation of the Corporation
with or into another corporation (other than a merger or consolidation in which
the Corporation is the surviving corporation and which does not result in any
reclassification or reorganization of the then outstanding shares of Common
Stock) and upon the effective date of any sale of all or substantially all of
the assets of the Corporation to any other entity (a "Terminating Event"), the
Plan and any unexercised Options granted under the Plan shall terminate unless a
provision shall be made in writing in connection with such Terminating Event for
the continuance of the Plan and, if the Corporation is not the surviving
corporation, for the assumption of such unexercised Options by a successor
employer or parent or subsidiary thereof or for the substitution for such
unexercised Options of new Options covering shares of such successor with
appropriate adjustments as to number, price and kind of securities or property
subject to such new Options. In such event, the Plan and the unexercised Options
theretofore granted or the new Options substituted therefor shall continue in
the manner and under the terms provided in the Plan. Prior to any such
termination of the
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<PAGE>
Plan, upon the effective date of any Terminating Event in which provision is not
made for the continuance of the Plan and for the assumption or substitution of
Options, the Committee may in its discretion permit each Key Employee to
accelerate the time at which his Option may be exercised and to purchase the
full number of shares under his Option which he would otherwise have been
entitled to purchase during the remaining term of such Option.
The provisions contained in the preceding sentence shall be inapplicable
to an Option granted within six (6) months before the occurrence of a
transaction described above if the holder of such Option is subject to the
reporting requirements of Regulations 17 C.F.R. ss. 240.16b-3 of the Exchange
Act.
17. AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN.
The Board may at any time terminate or from time to time suspend or modify
the Plan, provided that no modification without the approval of stockholders
shall (a) increase the maximum number of shares which may be sold under the
Plan, (b) permit the purchase of any shares unless payment of the purchase price
pursuant to Section 15 hereof is made at the time of purchase and (c) decrease
the minimum price at which shares may be sold.
Similarly (except as provided in or permitted by Section 16 hereof), the
Board may not make any alteration which would affect an Option previously
granted or, without the approval of the shareholders of the Corporation, make
any alteration which would (except as provided in Section 16 hereof) (a)
increase the aggregate number of shares for which Options may be granted; (b)
decrease the minimum Option price as set forth in Section 9 of the Plan; (c)
extend the term of the Plan or the maximum period during which any Option may be
exercised; or (d) change the class of employees eligible to receive Options. The
Board shall be authorized to amend the Plan and the Options granted thereunder
to qualify as incentive stock options within the meaning of Section 422 of the
Code. Notwithstanding the foregoing, amendment of the Plan relating to the
Eligible Director Participants shall be governed by Section 28 hereof.
15
<PAGE>
18. COMPLIANCE WITH LAW AND OTHER CONDITIONS.
The Plan, together with all Options and Stock Option Agreements under this
Plan, shall be governed by the laws of the State of New Jersey, to the extent
not superseded by the laws of the United States. No shares shall be issued, sold
or delivered pursuant to the exercise or surrender of any Option granted under
the Plan prior to (a) any registration or other qualification of such shares
under any state or federal law or regulation which the Committee shall, in its
absolute discretion upon the advice of counsel, deem necessary or advisable, and
(b) the admission of such shares to listing on any stock exchange on which the
stock may then be listed free of any conditions not acceptable to the Committee.
19. GOOD-FAITH ATTEMPTS.
As to Qualified Options granted under the Plan, to the extent consistent
with Section 422(c)(1) of the Code and Regulations issued by the Secretary of
the Treasury for incentive stock options, (i) the requirement set forth in
Section 9 of the Plan that the Option price of any Option granted under the Plan
be not less than 110% of the Fair Market Value of the Common Stock subject to
the option at the time if it is granted to a Key Employee other than an
Over-Ten-Percent Shareholder, and not less than 100% of the Fair Market Value of
the Common Stock if granted to a Key Employee who is an Over-Ten-Percent
Shareholder, and (ii) the limitation on the aggregate Fair Market Value of the
Common Stock for which a Key Employee may be granted Qualified Options as set
forth in Section 5 of the Plan, shall be considered to have been met if the
Committee has made a good-faith attempt to meet the requirements of Section
422(b)(4) or Section 422(b)(6) and 422(c)(5) of the Code or Section 422(d) of
the Code, as applicable, and such requirements are considered to have been met
pursuant to Section 422(c)(1) of the Code.
20. CONSTRUCTION.
It is intended that all Qualified Options granted under the Plan shall
constitute "incentive stock options" under Section 422 of the Code. To that end,
the Plan and all Stock Option Agreements entered into pursuant to it shall be
construed and interpreted so that all Qualified Options granted under the Plan
constitute "incentive stock options" within the meaning of Section 422 of the
Code, unless the terms and provisions of this instrument clearly and
16
<PAGE>
unequivocally require a contrary interpretation or construction.
21. EFFECTIVE DATE AND DURATION.
The Plan shall become effective on the date on which it is approved by a
majority of votes cast on the proposal as to the Plan by the shareholders of the
Corporation entitled to vote thereon, provided that the total vote cast on the
proposal represents over 50% in interest of all securities entitled to vote on
the proposal. No Options may be granted under the Plan after the ninth
anniversary of the effective date of the Plan.
22. WITHHOLDING TAXES.
The Corporation may require a Key Employee receiving shares of Common
Stock hereunder, exercising a Non-qualified Option granted hereunder, or
disposing of shares of Common Stock acquired pursuant to the exercise of a
Qualified Option in a disqualifying disposition (within the meaning of Section
421(b) of the Code), to reimburse the corporation that employs such employee for
any taxes required by any government to be withheld or otherwise deducted and
paid by such corporation in respect of the issuance or disposition of such
shares of Common Stock. In lieu thereof, the corporation that employs such
employee shall have the right to withhold the amount of such taxes from any
other sums due or to become due from such corporation to the employee upon such
terms and conditions as the Board of Directors shall prescribe. The corporation
that employs such employee may, in its discretion, hold the stock certificate to
which such employee is entitled upon the exercise of an Option as security for
the payment of such withholding tax liability, until cash sufficient to pay that
liability has been accumulated.
Subject to the consent of the Committee, an employee may make an
irrevocable election to have shares of Common Stock otherwise issuable withheld,
tender back to the Company shares of Common Stock received pursuant to an award
or deliver to the Corporation previously acquired shares of Common Stock having
a fair market value sufficient to satisfy all or part of the employee's
estimated tax obligations associated with the transaction. Such election must be
made by a Key Employee prior to the date on which the relevant tax obligation
arises. The Committee may disapprove of any election and may limit, suspend or
terminate the right to make such elections.
17
<PAGE>
In addition, at any time that the Corporation becomes subject to a
withholding obligation under applicable law with respect to the exercise of a
Non-qualified Option (the "Tax Date"), except as set forth below, a holder of a
Nonqualified Option may elect to satisfy, in whole or in part, the holder's
related personal tax liabilities (an "Election") by (i) directing the
Corporation to withhold from shares of Common Stock issuable in the related
exercise either a specified number of shares or shares of Common Stock having a
specified value (in each case not in excess of the related personal tax
liabilities), (ii) tendering shares previously issued pursuant to the exercise
of an Option or other shares of Common Stock owned by the holder or (iii) any
combination of (i) and (ii). An Election shall be irrevocable. The withheld
shares of Common Stock and other shares tendered in payment should be valued at
their Fair Market Value on the Tax Date. The Committee may disapprove of any
Election, suspend or terminate the right to make Elections or provide that the
right to make Elections shall not apply to particular shares of Common Stock or
exercises. If a holder is a person subject to Section 16 of the Exchange Act
then (1) any Election by such holder must be made (i) at least six months prior
to the relevant Tax Date or (ii) on or prior to the relevant Tax Date and during
a period that begins on the third business day following the date of release of
publication of the Corporation's quarterly or annual summary statements of sales
and earnings and that ends on the twelfth business day following such date and
(2) the Election may not be made with respect to an exercise, or the withholding
obligation arising thereon, if the relevant Option was granted six months or
less prior to the date of Election. The Committee may impose any other
conditions or restrictions on the right to make an Election as it shall deem
appropriate.
23. MISCELLANEOUS.
No member of the Board or of the Board of Directors of any Subsidiary or
any officer or employee of the Corporation or of any Subsidiary shall be
personally liable for any act or omission in good faith in connection with the
Plan.
The provisions of the Plan, and the restrictions and conditions set forth
herein, shall be binding upon the personal representatives of any Key Employee
or Eligible Director who purchases shares under the Plan, including the
executors, administrators or trustees of his estate and any receiver, trustee in
bankruptcy or representative of the creditors of such employee.
18
<PAGE>
All funds received by the Corporation, a Subsidiary or a Parent may be
used for any corporate purpose.
The Plan and the Corporation's, a Subsidiary's or a Parent's obligation to
sell and deliver shares of the Corporation's Common Stock, or to issue Options
under the Plan shall be subject to all applicable laws, rules and regulations
and to the approval of any governmental authority which the Corporation, in its
sole discretion, determines to be necessary or desirable in connection with the
Plan and the authorization, issuance, sale or delivery of such stock or Option.
Any shares of Common Stock purchased under the Plan by an employee and
transferred at the request of the employee, into the name of a bank, broker or
other fiduciary nominee shall remain subject to the provisions of the Plan.
With respect to persons subject to Regulations 17 C.F.R. ss. 240.16b-3 of
the Exchange Act, transactions under the Plan are intended to comply with all
applicable conditions of such regulation or its successors under the Exchange
Act. To the extent any provision of the Plan or action by the Committee fails to
so comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Committee.
24. STOCK OPTION GRANTS TO ELIGIBLE DIRECTORS.
Each person who was an Eligible Director on July 14, 1992 and each person
who becomes an Eligible Director thereafter shall automatically be granted, as
of July 14, 1992 or the date such person becomes an Eligible Director, as the
case may be, a Non-qualified Option to purchase 5,000 shares of Common Stock of
the Corporation (the "Initial Option"). Upon each anniversary of an Eligible
Director's grant of an Initial Option (and provided that such Eligible Director
has continued to serve in such capacity through such anniversary), such Eligible
Director shall automatically be granted an additional Non-qualified Option to
purchase 2,500 shares of Common Stock of the Corporation (the "Additional
Option"). The purchase price of the shares of Common Stock covered by the
Non-qualified Options granted pursuant to this Section 24 shall be the Fair
Market Value of such shares on the date of grant.
19
<PAGE>
25. ELIGIBLE DIRECTOR'S EXERCISE OF OPTIONS.
Subject to Section 27 hereof, a Non-qualified Option granted pursuant to
Section 24 hereof shall, to the extent not exercised, expire on the ninth
anniversary of the date of grant. An Initial Option granted to any Eligible
Director (i) shall not be exercisable prior to the first anniversary of the date
of grant, (ii) shall be exercisable with respect to one-third (1/3) of the
aggregate number of shares of Common Stock initially subject to the Initial
Option during the 12-month period commencing on the first anniversary of the
date of grant, (iii) shall be exercisable with respect to two-thirds (2/3) of
the aggregate number of shares of Common Stock initially subject to the Initial
Option during the 12-month period commencing on the second anniversary of the
date of grant and (iv) shall be exercisable with respect to the aggregate number
of shares of Common Stock initially subject to the Initial Option on and after
the third anniversary of the date of grant. An Additional Option granted to any
Eligible Director shall be exercisable with respect to one hundred percent
(100%) of the aggregate number of shares of Common Stock initially subject to
such Additional Option on and after the first anniversary of the date of grant.
26. ELIGIBLE DIRECTOR'S INELIGIBILITY FOR OTHER GRANTS.
Any Eligible Director who is eligible to receive an Option pursuant to
Section 24 hereof shall be ineligible to receive any other grant or award under
any other Section of this Plan.
27. ELIGIBLE DIRECTOR'S TERMINATION.
If an Eligible Director who has been granted Options pursuant to Section
24 hereof shall cease to be a director of the Corporation for any reason then
each Option held by such Eligible Director on the date of such cessation, to the
extent then exercisable, may be exercised at any time prior to the earlier of
(i) its expiration date or (ii) the expiration of a sixty (60) day period
following the date of such cessation.
28. AMENDMENT OF ELIGIBLE DIRECTOR PROVISIONS.
Sections 24 through 28 shall not be amended more than one time in any
six-month period, other than to comport with changes in the Code, the Employee
Retirement Income Security
20
<PAGE>
Act of 1974, as amended, or the rules promulgated thereunder.
21
<PAGE>
AMENDMENT TO THE
INTERNATIONAL SPECIALTY PRODUCTS INC.
1991 INCENTIVE PLAN FOR KEY EMPLOYEES
AND DIRECTORS, AS AMENDED
1. This Amendment (the "Amendment") to the International Specialty Products
Inc. 1991 Incentive Plan for Key Employees and Directors, as amended (the
"Plan"), is effective as of December 31, 1995, subject to stockholder
approval.
2. Section 9 of the Plan is hereby amended by deleting such section in its
entirety and substituting in lieu thereof a new Section 9 to read in its
entirety as follows:
"9. KEY EMPLOYEE OPTION PRICE.
Except as otherwise provided in this Section 9, the Committee
shall have full authority, in its discretion, to determine the
Option price per share at which Options granted under the Plan shall
be exercisable; provided, however, that (a) the Option price of any
Non-qualified Option shall be not less than 50% of the Fair Market
Value of the shares of Common Stock subject to such Option on the
date such Option is granted and (b) the Option price of any
Qualified Option shall be not less than 100% of the Fair Market
Value of the shares of Common Stock subject to such Option on the
date such Option is granted; and provided further that the Option
price of any Qualified Option granted to a Key Employee who is an
Over-Ten-Percent Shareholder shall be not less than 110% of the Fair
Market Value of the shares of Common Stock subject to such Option on
the date such Option is granted. In any event, the Option price
shall not be less than the par value of the shares subject to this
Option."
3. Section 11 of the Plan is hereby amended by deleting such section in its
entirety and substituting in lieu thereof a new Section 11 to read in its
entirety as follows:
<PAGE>
"11. EXERCISE OF OPTIONS BY KEY EMPLOYEES.
Subject to Section 16 hereof, and except as otherwise provided in
this Section 11, the Committee shall have full authority, in its
discretion, to determine the expiration date of any Option granted
under the Plan and the vesting period, if any, over which an Option
shall be exercisable by a Key Employee; provided, however, that the
Committee may, in its discretion, on a case-by-case basis, amend
each outstanding Option exercisable by a Key Employee to allow the
exercise of such Option, in whole or in part, upon, a Change in
Control of the Corporation. No Qualified Option granted to a Key
Employee who is an Over-Ten-Percent Shareholder shall be exercisable
as to all or any portion of the shares of Common Stock subject
thereto more than five years after the date of grant."
<PAGE>
AMENDMENT NO. 2 TO THE
INTERNATIONAL SPECIALTY PRODUCTS INC.
1991 INCENTIVE PLAN FOR KEY EMPLOYEES
AND DIRECTORS, AS AMENDED
1. This Amendment No. 2 (the "Amendment") to the International Specialty
Products Inc. 1991 Incentive Plan for Key Employees and Directors, as
amended (the "Plan") is effective as of December 9, 1996, subject to
stockholder approval.
2. The last sentence of the first paragraph of Section 5 of the Plan is
hereby amended by deleting such sentence in its entirety and substituting
in lieu thereof a new sentence to read in its entirety as follows:
"The aggregate number of shares for
which Options may be granted under the
Plan shall be seven million."
3. The third paragraph of Section 6 of the Plan is hereby amended by deleting
such paragraph in its entirety and substituting in lieu thereof a new
paragraph to read in its entirety as follows:
"Subject to the provisions of the Plan, the Committee shall
have full authority in its discretion to determine those Key
Employees to whom Options shall be granted and in each case
the number of shares to be subject to such Option, the date
on which it is to be granted, the Option price at which
shares covered thereby may be purchased (subject, however,
to Section 9 of the Plan), whether it is intended to be a
Qualified Option or a Non-qualified Option, and the other
terms thereof; provided that no single Key Employee may be
granted Options for more than 200,000 shares of Common Stock
during any calendar year."
<PAGE>
AMENDMENT NO. 3 TO THE
INTERNATIONAL SPECIALTY PRODUCTS INC.
1991 INCENTIVE PLAN FOR KEY EMPLOYEES
AND DIRECTORS, AS AMENDED
1. This Amendment (the "Amendment") to the International Specialty Products
Inc. 1991 Incentive Plan for Key Employees and Directors, as amended (the
"Plan"), is effective as of July 15, 1998, subject to stockholder
approval.
2. Section 2 of the Plan is hereby amended by deleting the definition of
"Change in Control" in its entirety and substituting in lieu thereof the
following definition:
"Change in Control" of the Company is deemed to have occurred if the
Heyman Group ceases to have, in the aggregate, directly or indirectly, at
least 20% of the voting power of the Company. The "Heyman Group" shall
mean (i) Samuel J. Heyman, his heirs, administrators, executors and
entities of which a majority of the voting stock is owned by Samuel J.
Heyman, his heirs, administrators or executors and (ii) any entity
controlled, directly or indirectly, by Samuel J. Heyman or his heirs,
administrators or executors.
2. Section 2 of the Plan is hereby further amended by adding the following
definitions in the appropriate alphabetical order:
"Effective Date" means the date of filing of the Certificate of Merger
with the Secretary of State of the State of Delaware in connection with
the Merger.
"Good Reason" means a change or changes in the terms of the employment of
a holder of Options that are materially adverse to such holder, including
with respect to salary and bonus, level of responsibility or geographic
location of employment.
"Holdings" means ISP Holdings Inc., a Delaware corporation.
"Merger" means the merger of the Corporation with and into Holdings.
<PAGE>
"Merger Agreement" means that certain Agreement and Plan of Merger dated
as of March 30, 1998 by and between the Corporation and Holdings.
"Preferred Stock Options" means those certain options to purchase shares
of Holdings' Series A Cumulative Redeemable Convertible Preferred Stock.
"SARs" means those certain stock appreciation rights granted by Holdings
based upon the value of Holdings common stock.
3. The last sentence of the first paragraph of Section 5 of the Plan is
hereby amended by deleting such sentence in its entirety and substituting
in lieu thereof a new sentence to read in its entirety as follows:
"The aggregate number of shares for which Options may be granted
under the Plan shall be nine million."
4. Section 11 of the Plan is hereby amended by deleting such section in its
entirety and substituting in lieu thereof a new Section 11 to read in its
entirety as follows:
"EXERCISE OF OPTIONS BY KEY EMPLOYEES.
Subject to Section 16 hereof, and except as otherwise provided in this
Section 11, the Committee shall have full authority, in its discretion, to
determine the expiration date of any Option granted under the Plan and the
vesting period, if any, over which an Option shall be exercisable by a Key
Employee; provided, however, that from and after the Effective Date, all
Options (including those outstanding at the Effective Date) shall become
immediately exercisable if a Change of Control shall occur and at any time
following such Change of Control: (i) the Corporation terminates without
cause the employment of the holder of such Options; (ii) such holder's
employment is terminated as a result of his death or permanent Disability;
or (iii) such holder terminates such employment for Good Reason. No
Qualified Option granted to a Key Employee who is an Over-Ten-Percent
Shareholder shall be exercisable as to all or any portion of the shares of
Common Stock subject thereto more than five years after the date of
grant."
<PAGE>
5. A new paragraph 29 shall be added to read in its entirety as follows:
"OPTION GRANTS TO HOLDERS OF HOLDINGS' PREFERRED STOCK OPTIONS AND SARs
Notwithstanding the provisions of Section 6, as of the Effective Date,
holders of Holdings' Preferred Stock Options and Holdings' SARs shall be
entitled to receive those certain option grants as contemplated in the
Merger Agreement."
Exhibit 5
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue New York, NY 10153-0119
(212) 310-8000
Fax: (212) 310-8007
July 31, 1998
International Specialty Products Inc.
1361 Alps Road
Wayne, New Jersey 07470
Ladies and Gentlemen:
We have acted as counsel to International Specialty Products Inc., a
Delaware corporation (the "Company"), in connection with the preparation and
filing of Post-Effective Amendment No. 1 on Form S-8 to the Form S-4
Registration Statement under the Securities Act of 1933 of the Company (the
"Registration Statement").
In so acting, we have examined originals or copies, certified or otherwise
identified to our satisfaction, of such corporate records, agreements, documents
and other instruments, and such certificates or comparable documents of public
officials and of officers and representatives of the Company, and have made such
inquiries of such officers and representatives, as we have deemed relevant and
necessary as a basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of documents
submitted to us as certified, conformed or photostatic copies and the
authenticity of the originals of such latter documents. As to all questions of
fact material to this opinion that have not been independently established, we
have relied upon certificates or comparable documents of officers and
representatives of the Company.
Based on the foregoing, and subject to the qualifications stated herein,
we are of the opinion that the 8,387,855 shares of Common Stock, par value $.01
per share,
NYFS01...:\01\47201\0035\1909\OPN7278V.120
<PAGE>
of the Company (the "Common Stock") to be issued and sold by the Company
pursuant to the Registration Statement, have been duly authorized and, when
issued and sold as contemplated by the Registration Statement and the
International Specialty Products Inc. 1991 Incentive Plan for Key Employees and
Directors, as amended, will be validly issued, fully paid and nonassessable.
The opinion herein is limited to the corporate laws of the State of
Delaware and we express no opinion as to the effect on the matters covered by
this opinion of the laws of any other jurisdiction.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Weil, Gotshal & Manges
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, 1998
included in International Specialty Products Inc.'s and ISP Holdings Inc.'s
filings on Form 10-K for the year ended December 31, 1997.
ARTHUR ANDERSEN LLP
Roseland, New Jersey
July 31, 1998
