<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 9, 1997
REGISTRATION NO. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
THE BOEING COMPANY
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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<S> <C>
DELAWARE 91-0425694
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>
7755 EAST MARGINAL WAY SOUTH
SEATTLE, WASHINGTON 99108
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES (ZIP CODE))
THE BOEING COMPANY
1997 INCENTIVE STOCK PLAN FOR EMPLOYEES
(FULL TITLE OF THE PLAN)
--------------------------
HEATHER HOWARD
CORPORATE SECRETARY AND CORPORATE COUNSEL
THE BOEING COMPANY
7755 EAST MARGINAL WAY SOUTH
SEATTLE, WASHINGTON 98108
(206) 655-7531
(NAME, ADDRESS AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
--------------------------
COPY TO:
J. SUE MORGAN
PERKINS COIE
1201 THIRD AVENUE, 40TH FLOOR
SEATTLE, WASHINGTON 98101-3099
(206) 583-8447
--------------------------
CALCULATION OF REGISTRATION FEE
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<CAPTION>
==============================================================================================================================
TITLE OF SECURITIES AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED REGISTERED(1) OFFERING PRICE PER SHARE(2) AGGREGATE OFFERING PRICE REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $5.00
per share 16,500,000 $ 97.9375 $1,615,968,750 $ 489,687.50
==============================================================================================================================
</TABLE>
(1) Includes an indeterminate number of additional shares that may be issued to
adjust the number of shares issued pursuant to such employee benefit plan
as the result of any future stock split, stock dividend or similar
adjustment of the Registrant's outstanding common stock.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended. The
price per share is estimated to be $97.9375, based on the average of the
high sales price ($99.125) and the low sales price ($96.75) for the
Registrant's common stock as reported on the New York Stock Exchange on May
8, 1997.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents are hereby incorporated by reference in this
Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996, filed with the Securities and Exchange Commission
(the "Commission"), on March 10, 1997, which contains audited consolidated
financial statements for the most recent fiscal year for which such statements
have been filed;
(b) All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), since the end of the fiscal year covered by the Annual Report
on Form 10-K referred to in (a) above; and
(c) The Registrant's Registration Statement on Form 10
(Registration No. 1-422) with respect to the Registrant's common stock and filed
with the Commission on April 20, 1935, under Section 12(g) of the Exchange Act,
including any amendments or reports filed for the purpose of updating such
description.
All documents filed by the Registrant pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date hereof and prior to the filing of
a post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters the securities covered hereby then remaining
unsold shall also be deemed to be incorporated by reference into this
Registration Statement and to be a part hereof commencing on the respective
dates on which such documents are filed.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The opinion of counsel as to the legality of the securities that may be
issued under the Registrant's 1997 Incentive Stock Plan for Employees (the
"Plan") is given by Heather Howard, Corporate Secretary and Corporate Counsel
for the Registrant.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement in connection with specified actions, suits or
proceedings, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation in a derivative action), if
they acted in good faith and in a manner they reasonably believed to be in or
not opposed to the best interests of the corporation, and, with the respect to
any criminal action, had no reasonable cause to believe their conduct was
unlawful. A similar standard is applicable in the case of derivative actions,
and the statute requires court approval before there can be any indemnification
where the person seeking indemnification has been found liable to the
corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's charter, by-laws,
disinterested director vote, stockholder vote, agreement or otherwise.
Article VII, Section 4 of the Registrant's By-Laws provides for
indemnification of the Registrant's directors and officers to the full extent
permitted under Delaware law.
Section 102(b)(7) of the Delaware General Corporation Law permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law, (iii) for
payments of unlawful dividends or unlawful stock repurchases or redemptions, or
(iv) for any transaction from which the director derived an improper personal
benefit.
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Article Twelfth of the Registrant's Restated Certificate of
Incorporation provides that, to the full extent that Delaware law permits the
limitation or elimination of the liability of directors, a director of the
Registrant will not be liable to the Registrant or its stockholders for monetary
damages for breach of fiduciary duty as a director.
Officers and directors of the Registrant are covered by insurance that,
with certain exceptions and within certain limitations, indemnifies them against
losses and liabilities arising from any alleged "wrongful act," including any
alleged error or misstatement, misleading statement, wrongful act or omission,
neglect or breach of duty, in their capacities as such.
ITEM 8. EXHIBITS
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Exhibit Number Description
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<S> <C>
5.1 Opinion of counsel regarding legality of the Common Stock being registered
23.1 Consent of Deloitte & Touche LLP (see page II-6)
23.2 Consent of counsel (included in Exhibit 5.1)
24.1 Power of Attorney (see Signature Page)
99.1 The Boeing Company 1997 Incentive Stock Plan for Employees
</TABLE>
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:
(a) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933, as amended (the "Securities Act");
(b) 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) that, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement; and
(c) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that paragraphs (1)(a) and (1)(b) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the 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 that 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 15(d) of the Exchange
Act (and, where
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<PAGE> 4
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in 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 Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Seattle, State of Washington, on April 28, 1997.
THE BOEING COMPANY
By: /s/ Philip M. Condit
----------------------------------------------
Philip M. Condit
Chairman of the Board and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints
Philip M. Condit, Theodore J. Collins and B.E. Givan, or any of them, his or her
attorneys-in-fact, with the power of substitution, for him or her in any and all
capacities, to sign any amendments to this Registration Statement, and to file
the same, with exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, hereby ratifying and confirming all
that said attorneys-in-fact, or their substitute or substitutes, may do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on April 28, 1997.
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SIGNATURE TITLE
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<S> <C>
/s/ Philip M. Condit Chairman of the Board and Chief Executive Officer
- ------------------------- (Principal Executive Officer)
Philip M. Condit
/s/ B.E. Givan Senior Vice President and Chief Financial Officer
- ------------------------- (Principal Financial Officer)
B.E. Givan
/s/ Gary W. Beil Vice President and Controller
- ------------------------- (Principal Accounting Officer)
Gary W. Beil
/s/ John E. Bryson Director
- -------------------------
John E. Bryson
/s/ John B. Fery Director
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John B. Fery
/s/ Paul E. Gray Director
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Paul E. Gray
/s/ Harold J. Haynes Director
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Harold J. Haynes
/s/ Donald E. Petersen Director
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Donald E. Petersen
/s/ Charles M. Pigott Director
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Charles M. Pigott
/s/ Rozanne L. Ridgway Director
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Rozanne L. Ridgway
</TABLE>
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<TABLE>
<S> <C>
/s/ Frank A. Shrontz Director
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Frank A. Shrontz
/s/ George H. Weyerhaeuser Director
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George H. Weyerhaeuser
</TABLE>
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<PAGE> 7
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
The Boeing Company on Form S-8 of our reports dated January 23, 1997, appearing
in and incorporated by reference in the Annual Report on Form 10-K of The Boeing
Company and subsidiaries for the year ended December 31, 1996.
/s/ Deloitte & Touche LLP
- -------------------------
DELOITTE & TOUCHE LLP
Seattle, Washington
May 6, 1997
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<PAGE> 8
INDEX TO EXHIBITS
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EXHIBIT NUMBER DESCRIPTION
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5.1 Opinion of counsel regarding legality of the Common Stock being registered
23.1 Consent of Deloitte & Touche LLP (see page II-6)
23.2 Consent of counsel (included in Exhibit 5.1)
24.1 Power of Attorney (see Signature Page)
99.1 The Boeing Company 1997 Incentive Stock Plan for Employees
</TABLE>
<PAGE> 1
EXHIBIT 5.1
May 5, 1997
The Boeing Company
7755 East Marginal Way South
Seattle, Washington 98108
RE: REGISTRATION STATEMENT ON FORM S-8
Gentlemen and Ladies:
As Corporate Counsel of The Boeing Company (the "Company"), I have
acted as counsel in connection with the Registration Statement on Form S-8 which
is being filed with the Securities and Exchange Commission under the Securities
Act of 1933, as amended, with respect to 16,500,000 shares of common stock,
$5.00 par value, of the Company (the "Shares"). The Shares may be issued
pursuant to The Boeing Company 1997 Incentive Stock Plan for Employees (the
"Plan").
I have examined the Registration Statement and a copy of the Restated
Certificate of Incorporation of the Company and any amendments thereto to date,
a copy of the By-Laws of the Company as amended to date, and such resolutions of
the Board of Directors of the Company and other documentation as I have deemed
necessary for the purpose of this opinion.
Based upon and subject to the foregoing, I am of the opinion that the
Shares that may be issued by the Company pursuant to the Plan, upon the due
execution by the Company and registration by its registrar of the Shares and the
issuance thereof by the Company in accordance with the terms of the Plan, and
the receipt of consideration therefor in accordance with the terms of the Plan,
will be validly issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to me under the heading "Interests
of Named Experts and Counsel" in the Registration Statement.
Cordially,
/s/ Heather Howard
-----------------------------------------
Heather Howard
Corporate Secretary and Corporate Counsel
<PAGE> 1
EXHIBIT 99.1
THE BOEING COMPANY 1997 INCENTIVE STOCK PLAN FOR EMPLOYEES
1. PURPOSE.
The purpose of this 1997 Incentive Stock Plan for Employees (the "Plan") is
to attract, retain and motivate key employees by providing them the opportunity
to acquire a proprietary interest in The Boeing Company (the "Company") and to
link their interests and efforts to the long-term interests of the Company's
shareholders.
2. PLAN ADMINISTRATION.
2.1 THE COMPENSATION COMMITTEE.
The Plan shall be administered by the Compensation Committee (the
"Committee") of the Company's Board of Directors (the "Board"). Except for the
terms and conditions explicitly set forth in the Plan, the Committee shall have
the authority, in its discretion, to determine all matters relating to awards
under the Plan, including selection of the individuals to be granted awards, the
type of awards granted, the number of shares of the Company's common stock (the
"Common Stock") subject to an award, all terms, conditions, restrictions and
limitations, if any, of an award, and the terms of any award agreement or
notice.
2.2 OTHER PLANS.
The Committee shall also have authority to grant awards as an alternative
to or as the form of payment for grants or rights earned or due under other
compensation plans or arrangements of the Company, including the plan of any
entity acquired by the Company.
2.3 DELEGATION TO STOCK PLAN COMMITTEE.
Except for the power to amend the Plan as provided in Section 12, the Board
or the Committee, in its sole discretion, may delegate the Committee's authority
and duties under the Plan to the Stock Plan Committee of the Board or to such
other committee appointed by the Board consisting of one or more senior
executive officers of the Company who are also members of the Board, under such
conditions and limitations as the Board or the Committee may from time to time
establish, except that only the committee may make any determinations regarding
awards to participants who are subject to Section 16 of the Securities Exchange
Act of 1934, as amended (the "1934 Act").
2.4 FINALITY OF COMMITTEE DETERMINATIONS.
All decisions made by the Committee or its delegate pursuant to the
provisions of the Plan and all determinations and selections made by the
Committee or its delegate pursuant to such provisions and related orders or
resolutions of the Board shall be final and conclusive.
3. ELIGIBILITY.
Any employee of the Company shall be eligible to receive an award under the
Plan. For purposes of this Section 3, the "Company," with respect to all awards
under the Plan other than Incentive Stock Options (as defined in Section 6.2),
includes any entity that is directly or indirectly controlled by the Company or
any entity in which the Company has a significant equity interest, as determined
by the Committee. With respect to Incentive Stock Options, the "Company"
includes any parent or subsidiary of the Company in accordance with Section 422
of the Internal Revenue Code of 1986, as amended (the "Code").
<PAGE> 2
4. SHARES SUBJECT TO THE PLAN.
4.1 NUMBER AND SOURCE.
The stock offered under the Plan shall be shares of Common Stock and may be
unissued shares or shares now held or subsequently acquired by the Company as
treasury shares, as the Board, or a Board committee to which the Board may
delegate such authority, may from time to time determine. Subject to adjustment
as provided in Sections 4.3 and 5, the aggregate number of shares that may be
issued under the Plan shall not exceed fifteen million (15,000,000). Subject to
adjustment as provided in Sections 4.3 and 5, the aggregate number of shares
that may be issued under awards granted pursuant to Section 6.4 shall not exceed
three million (3,000,000). The aggregate number of shares that may be covered by
awards granted to any one individual in any one calendar year shall not exceed
six hundred thousand (600,000).
4.2 SHARES AVAILABLE.
Any shares subject to an award granted under the Plan that is forfeited,
terminated or canceled or, in the case of awards granted under Section 6.4, any
shares that do not vest, shall again be available for the granting of awards
under the Plan. In instances where a stock appreciation right is settled in
cash, the shares covered by such award shall remain available for the granting
of other awards. Likewise, the payment of cash dividends and dividend
equivalents paid in cash in conjunction with outstanding awards shall not be
counted against the shares available for issuance.
4.3 ACQUISITIONS.
The Board, in its sole discretion, may increase the aggregate number of
shares of Common Stock to be delivered under Section 4.1 by up to one million
five hundred thousand (1,500,000) shares in the event the Company acquires any
other corporation or business entity and the Company agrees to assume the
acquired entity's obligations for outstanding employee stock options or stock
grant commitments or otherwise grants awards to employees in connection with
such acquisition.
5. ADJUSTMENT OF SHARES AVAILABLE.
The aggregate numbers and kind of shares available for awards under the
Plan, the maximum number and kind of shares that may be subject to awards to any
individual under the Plan, the number and kind of shares covered by each
outstanding award, and the exercise price per share (but not the total price)
for stock options, stock appreciation rights or similar awards outstanding under
the Plan shall all be proportionately adjusted for any increase or decrease in
the number of issued shares of Common Stock resulting from any split-up,
combination or exchange of shares, consolidation, spin-off or recapitalization
of shares or any like capital adjustment or the payment of any stock dividend.
6. AWARDS.
6.1 TYPES OF AWARDS.
The Committee shall have the authority, in its sole discretion, to
determine the type or types of awards to be granted to employees under the Plan.
Such awards may include, but are not limited to, Incentive Stock Options,
Nonqualified Stock Options (as defined in Section 6.2), stock appreciation
rights or restricted stock awards. Such awards may be granted either alone, in
addition to or in tandem with any other type of award granted under the Plan.
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<PAGE> 3
6.2 STOCK OPTIONS.
The Committee may grant stock options, designated as "Incentive Stock
Options," which comply with the provisions of Section 422 of the Code or any
successor statutory provision, or "Nonqualified Stock Options." The price at
which shares may be purchased upon exercise of a particular option shall be
determined by the Committee but shall not be less than 100% of the Fair Market
Value of such shares at the time such option is granted. For purposes of the
Plan, "Fair Market Value" as to a particular day equals the mean of the high and
low per share trading prices for the Common Stock as reported for such day in
the Wall Street Journal or in such other source as the Committee deems reliable.
The Committee shall set the term of each stock option, but no Incentive Stock
Option shall be exercisable more than 10 years after the date such option is
granted and, to the extent the aggregate Fair Market Value (determined as of the
date the option is granted) of Common Stock with respect to which Incentive
Stock Options granted to a particular individual become exercisable for the
first time during any calendar year (under the Plan and all other stock option
plans of the Company) exceeds $100,000 (or such corresponding amount as may be
set by the Code) such options shall be treated as Nonqualified Stock Options.
6.3 STOCK APPRECIATION RIGHTS.
The Committee may grant stock appreciation rights to employees, either in
tandem with stock options that have been or are granted under the plan or with
respect to a number of shares on which an option is not granted. A stock
appreciation right shall entitle the holder to receive, with respect to each
share of stock as to which the right is exercised, payment in an amount equal to
the excess of the share's Fair Market Value on the date the right is exercised
over its Fair Market Value on the date the right was granted. Such payment may
be made in cash or in shares of Common Stock valued at the Fair Market Value as
of the date of the surrender, or partly in cash and partly in shares of Common
Stock, as determined by the committee in its sole discretion. The Committee may
establish a maximum appreciation value payable for stock appreciation rights.
6.4 RESTRICTED STOCK AWARDS.
(a) The Committee may grant restricted stock awards under the Plan in
Common Stock or denominated in units of Common Stock. The Committee, in its
discretion, will make such awards subject to conditions and restrictions, as set
forth in the instrument evidencing the award, which may be based on continuous
service with the Company or the attainment of certain performance goals related
to profits, profit growth, profit-related return ratios, cash flow or
shareholder returns, where such goals may be stated in absolute terms or
relative to comparison companies or indices to be achieved during a period of
time. No more than one million five hundred thousand (1,500,000) shares may be
issued subject to restrictions based on continuous employment for less than
three years (except where employment is terminated because the employee dies,
retires, is laid off or becomes disabled).
(b) The Committee may choose, at the time of granting an award or at any
time thereafter up to the time of payment of the award, to include as part of
such award an entitlement to receive dividends or dividend equivalents, subject
to such terms as the Committee may establish. All dividends or dividend
equivalents that are not paid currently may, in the Committee's sole discretion,
accrue interest and be paid to the participant if, when and to the extent such
award is paid.
6.5 PAYMENT; DEFERRAL.
Awards granted under the Plan may be settled through cash payments, the
delivery of Common Stock or the granting of awards or combinations thereof as
the committee shall determine. Any award settlement, including payment
deferrals, may be subject to such conditions, restrictions and contingencies as
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<PAGE> 4
the Committee shall determine. The Committee may permit or require the deferral
of any award payment, subject to such rules and procedures as it may establish,
which may include provisions for the payment or crediting of interest, or
dividend equivalents, including converting such credits to deferred stock unit
equivalents.
7. OPTION EXERCISE.
7.1 EMPLOYMENT REQUIREMENT.
Each award agreement or notice for a stock option or stock appreciation
right shall contain a provision that the option or right shall not be
exercisable unless the optionee remains in the Company's employ at least 12
months after the granting of the option or right.
7.2 PRECONDITION TO STOCK ISSUANCE.
No shares shall be delivered pursuant to the exercise of any stock option
or stock appreciation right, in whole or in part, until qualified for delivery
under such securities laws and regulations as may be deemed by the Committee to
be applicable thereto and until, in the case of the exercise of an option,
payment in full of the option price thereof (in cash or stock as provided in
Section 7.4) is received by the Company. No holder of an option or stock
appreciation right, or any legal representative, legatee or distributee shall be
or be deemed to be a holder of any shares subject to such option or right unless
and until such shares are issued.
7.3 NO FRACTIONAL SHARES.
No stock option may at any time be exercised with respect to a fractional
share. No fractional share shall be issued in the event shares are issued
pursuant to the exercise of a stock appreciation right; however, a fractional
stock appreciation right may be exercised for cash.
7.4 FORM OF PAYMENT.
An optionee may exercise a stock option using as the form of payment (i)
cash or cash equivalent, (ii) stock-for-stock payment (as described in Section
7.5), (iii) any combination of the above or (iv) such other means as the
Committee may approve.
7.5 STOCK FOR STOCK.
An optionee who owns Common Stock may use such shares, the value of which
shall be determined as the Fair Market Value of such shares on the date the
stock option is exercised, as a form of payment to exercise stock options under
the Plan. The Committee, in its discretion, may restrict or rescind this right
by notice to optionees. A stock option may be exercised in such manner only by
tendering (actually or by attestation) to the Company whole shares of Common
Stock having a Fair Market Value equal to or less than the exercise price. If an
option is exercised by surrender of stock having a Fair Market Value less than
the exercise price, the employee must pay the difference in cash.
8. TRANSFERABILITY.
The right of any award recipient to exercise an award granted under the
Plan shall, during such recipient's lifetime, be exercisable only by such
recipient, and shall not be assignable or transferable by such recipient other
than by will or the laws of descent and distribution.
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<PAGE> 5
9. WITHHOLDING TAXES; OTHER DEDUCTIONS.
The Company shall have the right to deduct from any settlement of an award
made under the Plan, including the delivery or vesting of shares, (a) an amount
sufficient to cover withholding as required by law for any federal, state or
local taxes and (b) any amounts due from the recipient of such award to the
Company or to any subsidiary of the Company or to take such other action as may
be necessary to satisfy any such withholding or other obligations, including
withholding from any other cash amounts due or to become due from the Company to
such recipient an amount equal to such taxes or obligations.
10. TERMINATION OF EMPLOYMENT.
The terms and conditions under which an award may be exercised following
termination of a participant's employment with the Company shall be determined
by the Committee; provided, that if a participant's employment with the Company
terminates for any reason within 12 months of the grant date of a stock option
or stock appreciation right, such option or right shall expire as of the date of
such termination of employment and the participant and the participant's legal
representative shall forfeit any and all rights pertaining to such award.
11. TERM OF THE PLAN.
The Plan shall become effective as of May 1, 1997 and shall remain in full
force and effect through April 30, 2007, unless sooner terminated by the Board.
After the Plan is terminated, no future awards may be granted but awards
previously granted shall remain outstanding in accordance with their applicable
terms and conditions and the Plan's terms and conditions.
12. PLAN AMENDMENT.
The Committee or the Board may amend, suspend or terminate the Plan at any
time; provided that no such amendment shall be made without the approval of the
Company's stockholders (a) that would increase the number of shares available
for issuance in accordance with Section 4 or (b) if such approval is required
(i) to comply with Section 422 of the Code with respect to Incentive Stock
Options or (ii) for purposes of Section 162(m) of the Code.
13. BIFURCATION OF THE PLAN.
Notwithstanding anything in the Plan to the contrary, the Board, in its
sole discretion, may bifurcate the Plan so as to restrict, limit or condition
the use of any provision of the Plan to participants who are officers subject to
Section 16 of the 1934 Act without so restricting, limiting or conditioning the
Plan with respect to other participants.
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