<PAGE> 1
As filed with the Securities and Exchange Commission on July 11, 1996
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
---------------------------
HARRIS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 34-0276860
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1025 W. NASA Boulevard
Melbourne, Florida 32919
(Address of Principal Executive Offices) (Zip Code)
---------------------------
HARRIS CORPORATION STOCK INCENTIVE PLAN
(Full Title of the Plan)
R. L. Ballantyne, Secretary
HARRIS CORPORATION
1025 W. NASA Boulevard
Melbourne, Florida 32919
(Name and address of agent for service)
(407) 727-9100
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Proposed Proposed
maximum maximum
offering aggregate Amount of
Title of securities Amount to be price per offering registration
to be registered registered share (2) price (2) fee
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$1 per share 2,000,000 $59.1875 $118,375,000 $40,818.97
Preferred Stock
Purchase Rights 2,000,000 N/A N/A N/A
========================================================================================================
<FN>
(1) IN ADDITION, PURSUANT TO RULE 416(c) UNDER THE SECURITIES ACT OF 1933
THIS REGISTRATION STATEMENT ALSO COVERS AN INDETERMINATE AMOUNT OF
INTERESTS TO BE OFFERED OR SOLD PURSUANT TO THE EMPLOYEE BENEFIT PLAN
DESCRIBED HEREIN.
(2) BASED ON THE AVERAGE OF THE HIGH AND LOW PRICES REPORTED IN THE
CONSOLIDATED TRANSACTION REPORTING SYSTEM FOR JULY 9, 1996,
PURSUANT TO RULE 457(h) UNDER THE SECURITIES ACT OF 1933.
</TABLE>
<PAGE> 2
PART II
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents of the Registrant, previously filed
with the Securities and Exchange Commission (the "Commission"), are incorporated
herein by reference and made a part hereof:
1. The Registrant's Annual Report on Form 10-K for the year ended
June 30, 1995.
2. The Registrant's Quarterly Reports on Form 10-Q for the
quarters ended September 30, 1995, December 31, 1995 and March
31, 1996.
3. The Registrant's Current Reports on Form 8-K dated October 12,
1995, January 4, 1996, January 10, 1996 and May 6, 1996.
4. Description of Registrant's Common Stock set forth under the
caption "Description of Stock" in the Registrant's
Registration Statement on Form S-8 (File No. 33-31370).
5. Description of Registrant's Preferred Stock Rights set forth
in Item 1 of Registrant's Form 8-A filed with the Commission
on November 25, 1986.
All documents filed by the Registrant pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of this
Registration Statement, prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference into this Registration Statement and to be part hereof from the date
of filing of such documents.
Item 4. DESCRIPTION OF SECURITIES
Not applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Richard L. Ballantyne is Vice President-General Counsel and
Secretary of the Registrant. As of June 14, 1996, Mr. Ballantyne was the
beneficial owner of 3,945 shares of Common Stock, 6,250 performance shares
granted under the Registrant's Stock Incentive Plan and 2,500 options to acquire
shares of Common Stock, of which none are exercisable within 60 days of that
date.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Subsection (a) of Section 145 of the General Corporation Law of the
State of Delaware empowers a corporation to 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, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation,
2
<PAGE> 3
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.
Subsection (b) of Section 145 empowers a corporation to 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 such
person acted in any of the capacities set forth in the paragraph above, 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 to 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 that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnification for such expenses which the Court of Chancery or such other
court shall deem proper.
Section 145 further provides that to the extent a director, officer,
employee or agent 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; that indemnification and advancement of expenses provided
for by Section 145 shall not be deemed exclusive of any other rights to which
the indemnified party may be entitled; and empowers the corporation to purchase
and maintain insurance on behalf of a director or officer, employee or agent of
the corporation 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.
Article VI of the By-laws of the Registrant provides that the
Registrant shall indemnify any person who is or was a director or officer of the
Registrant or is or was serving at the request of the Registrant as a director
or officer of another enterprise (and his heirs, executors and administrators)
against reasonable expenses (including attorneys' fees, judgments, fines and
amounts paid in settlement) incurred by him in such capacity or arising out of
his status as such, in connection with any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (a) to the extent, and according to the procedures and
requirements, set forth in the General Corporation Law of Delaware and, in
addition, (b) to the extent authorized upon a determination made in accordance
with the By-laws that such person acted in good faith and is fairly and
reasonably entitled to be indemnified in view of all the circumstances.
The Registrant has purchased an insurance policy indemnifying its
officers and directors and the officers and directors of its subsidiaries
against claims and liabilities (with stated exceptions) to which
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they may become subject by reason of their positions with the Registrant as
directors and officers. A separate policy insures fiduciaries, as defined by the
Employee Retirement Income Security Act of 1974, of various employee benefit
plans of the Registrant.
The Registrant has also entered into agreements with its directors and
officers which indemnify them against claims and liabilities to which they may
become subject by reason of their position with the Registrant.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
Item 8. EXHIBITS
(4)(a) Rights Agreement dated as of November 24, 1986, between Harris
Corporation and Ameritrust Company National Association, as Rights
Agent, is incorporated by reference to the Form 8-A filed with the
Commission on November 25, 1986.
(5) Opinion of Richard L. Ballantyne, Vice President-General Counsel and
Secretary of the Corporation, as to the validity of the securities
registered hereby.
(23)(a) Consent of Richard L. Ballantyne (Included in Opinion at Exhibit 5).
(23)(b) Consent of Ernst & Young LLP.
(24) Powers of Attorney.
(99) Harris Corporation Stock Incentive Plan.
Item 9. UNDERTAKINGS
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 of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
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(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
Provided, however, that paragraphs (1)(i) and (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 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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 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 Act and will be
governed by the final adjudication of such issue.
5
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Harris
Corporation 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 Melbourne, State of Florida, on this 11th day of
July, 1996.
HARRIS CORPORATION
By: /s/ B. R. Roub
--------------------------------
B. R. Roub
Senior Vice President-Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Phillip W. Farmer* Chairman of the Board of
- --------------------- Directors. Chief Executive
Phillip W. Farmer Officer and Director (Principal
Executive Officer)
/s/ B. R. Roub Senior Vice President-Chief Financial Officer
- --------------------- (Principal Financial Officer)
Bryan R. Roub
/s/ R. W. Fay Vice President-Controller July 11, 1996
- --------------------- (Principal Accounting Officer)
Robert W. Fay
/s/ Robert Cizik* Director
- ---------------------
Robert Cizik
</TABLE>
6
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<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Lester E. Coleman* Director
- -----------------------------
Lester E. Coleman
Director
- -----------------------------
Alfred C. DeCrane, Jr.
/s/ Ralph D. DeNunzio* Director
- -----------------------------
Ralph D. DeNunzio
/s/ Joseph L. Dionne* Director
- -----------------------------
Joseph L. Dionne
/s/ John T. Hartley* Director
- -----------------------------
John T. Hartley
/s/ Karen Katen* Director
- -----------------------------
Karen Katen
/s/ Walter F. Raab* Director July 11, 1996
- -----------------------------
Walter F. Raab
/s/ Alexander B. Trowbridge* Director
- -----------------------------
Alexander B. Trowbridge
</TABLE>
*By /s/ R. L. Ballantyne
------------------------------------
R. L. Ballantyne, Attorney-in-Fact
<PAGE> 1
Exhibit 5
Harris Corporation
1025 W. NASA Boulevard
Melbourne, Florida 32919
July 11, 1996
Securities and Exchange Commission
450 Fifth Street, NW
Judiciary Plaza
Washington, DC 20549
Gentlemen:
Reference is made to Registration Statement on Form S-8 (the
"Registration Statement") filed with the Securities and Exchange Commission with
respect to 2,000,000 shares of Common Stock, par value $1.00 per share (the
"Common Stock") and 2,000,000 Preferred Stock Purchase Rights of Harris
Corporation (the "Corporation") which may be offered pursuant to the
Corporation's Stock Incentive Plan (the "Plan").
I am familiar with the Registration Statement and the offering
contemplated thereby and in that regard I have examined such documents,
instruments and certificates and questions of law as I deem necessary to this
opinion. Based upon the foregoing, I am of the opinion that (i) the 2,000,000
shares of Common Stock to be offered pursuant to the Plan after the Registration
Statement becomes effective will, upon sale thereof in accordance with the Plan,
be validly issued and outstanding, fully paid and non-assessable and (ii) the
2,000,000 Preferred Stock Purchase Rights to be offered pursuant to the Plan
after the Registration Statement becomes effective will be validly issued and
outstanding and non-assessable.
I hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Respectfully submitted,
/s/ Richard L. Ballantyne
Richard L. Ballantyne
<PAGE> 1
Exhibit (23)(b)
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration
Statement (Form S-8; No. 333- ) pertaining to the Harris Corporation Stock
Incentive Plan of our report dated July 27, 1995, with respect to the
consolidated financial statements and schedule of Harris Corporation and
subsidiaries included in its Annual Report (Form 10-K) for the year ended June
30, 1995, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Orlando, Florida
July 11, 1996
<PAGE> 1
Exhibit 24
HARRIS CORPORATION
THE UNDERSIGNED, an officer or director of Harris Corporation
("Corporation"), a Delaware corporation, which anticipates filing with the
Securities and Exchange Commission, Washington, D.C., under the provisions of
the Securities Act of 1933, as amended, Registration Statement or post-effective
amendment to Registration Statement on Form S-8 or other appropriate form for
the purpose of registering Common Stock of the Corporation, par value $1 per
share, to be offered pursuant to the Corporation's Stock Incentive Plan, does
hereby constitute and appoint B.R. Roub, R.W. Fay, D.S. Wasserman,
R.L. Ballantyne, and K.G. Fink, and any one of them, with full power of
substitution and resubstitution, as attorneys or attorney to sign for him and
in his name the Registration Statement and any and all amendments and exhibits
thereto, and any and all applications or other documents to be filed with the
Securities and Exchange Commission pertaining to the Registration Statement or
registration contemplated thereby, with full power and authority to do and
perform any and all acts and things whatsoever required or necessary to be done
to effect such registrations as fully to all intents and purposes as he could do
if personally present, hereby ratifying and approving the acts of said
attorneys, and any of them and any such substitute.
EXECUTED AT Melbourne, Florida, this 26th day of April, 1996.
/s/ Phillip W. Farmer
-----------------------------
Phillip W. Farmer
/s/ Robert Cizik
-----------------------------
Robert Cizik
/s/ Lester E. Coleman
-----------------------------
Lester E. Coleman
/s/ Ralph D. DeNunzio
-----------------------------
Ralph D. DeNunzio
/s/ Joseph L. Dionne
-----------------------------
Joseph L. Dionne
/s/ John T. Hartley
-----------------------------
John T. Hartley
/s/ Karen Katen
-----------------------------
Karen Katen
/s/ Walter F. Raab
-----------------------------
Walter F. Raab
/s/ Alexander B. Trowbridge
-----------------------------
Alexander B. Trowbridge
<PAGE> 1
EXHIBIT 99
HARRIS CORPORATION
STOCK INCENTIVE PLAN
AMENDED AS OF JUNE 28, 1996
1. PURPOSE.
The purpose of the Harris Corporation Stock Incentive Plan (the "Plan")
is to promote the long-term growth and performance of Harris Corporation (the
"Corporation") and its affiliates and to attract and retain outstanding
individuals by awarding directors and salaried employees performance-based stock
awards, restricted stock, stock options, stock appreciation rights and/or other
stock-based awards.
2. DEFINITIONS
The following definitions are applicable to the Plan:
"Award" means the grant of performance shares, restricted stock, stock
options, stock appreciation rights or other share-based award under the Plan.
"Board" means the Board of Directors of the Corporation.
"Board Committee" means a committee of the Board consisting of Outside
Directors.
"Commission" means the Securities and Exchange Commission.
"Committee" means a committee of the Board to which the Board has
delegated authority and responsibility under the Plan and which shall be
appointed by, and serve at the pleasure of, the Board, and shall be constituted
so as to satisfy any applicable legal requirements, including the requirements
of Rule 16b-3 promulgated by the Commission under the Securities Exchange Act of
1934, as amended from time to time, or under any successor rule adopted by the
Commission and Section 162(m) of the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated thereunder.
"Common Stock" means the common stock of the Corporation, $1.00 par
value per share.
"Executive Officer" means any Participant the Board has designated as
an executive officer of the Corporation for purposes of reporting under the
Securities Exchange Act of 1934, as amended from time to time, or any successor
thereto.
"Grant Date" means the date on which the grant of an Option under
Section 7.1 hereof or a SAR under Section 8.1 hereof becomes effective pursuant
to the terms of the Stock Option Agreement or Stock Appreciation Rights
Agreement, as the case may be, relating thereto.
<PAGE> 2
"Non-employee Director" means a member of the Board who is not an
employee of the Corporation or any affiliate thereof.
"Option" means the option to purchase shares of Common Stock granted
under Sections 7.1 and 10.1 hereof.
"Option Price" means the purchase price of each share of Common Stock
under an Option.
"Outside Director" means a member of the Board who is not an employee
of the Corporation or any affiliate thereof and who qualifies as an "outside
director" under Section 162(m) of the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated thereunder.
"Participant" means any salaried employee of the Corporation and its
affiliates designated by the Board Committee to receive an Award under the Plan.
"Performance Goal" means any of the following measurements: the
Corporation's revenue, earnings per share of Common Stock, net income, return on
equity, return on capital, return on assets, total shareholder return or cash
flow, or any combination thereof.
"Performance Period" means the period of time established by the Board
Committee for achievement of certain objectives under Section 5.1 hereof.
"Shares" means shares of Common Stock, subject to adjustments made
under Section 3.2 or operation of law.
"Restriction Period" means the period of time established by the Board
Committee during which certain restrictions as to vesting and on the sale or
other disposition of Shares awarded under the Plan remain in effect under
Section 6.1 hereof.
"Stock Appreciation Rights" or "SARs" means the right to receive a cash
payment from the Corporation equal to the excess of the fair market value of a
stated number of shares of Common Stock at the exercise date over a fixed price
for such shares.
"Units" means units under a share-based award that is payable solely in
cash or is actually paid in cash, determined by reference to the number of
shares by which the share- based award is measured.
3. SHARES AND UNITS SUBJECT TO PLAN
3.1 SHARES RESERVED UNDER THE PLAN. (a) The aggregate number of Shares
which may be awarded under the Plan in each fiscal year of the Corporation,
subject to adjustment as provided in Section 3.2 hereof, shall be one percent
(1%) of the total outstanding Shares as of the
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first day of such year for which the Plan is in effect; provided that no more
than two million (2,000,000) Shares shall be cumulatively available for the
grant of incentive stock options under the Plan. In addition, any Common Stock
issued by the Corporation through the assumption or substitution of outstanding
grants from an acquired corporation or entity shall not reduce the shares
available for grants under the Plan. Shares to be issued pursuant to the Plan
may be authorized and unissued Shares, treasury Shares, or any combination
thereof.
(b) AGGREGATE UNIT LIMIT. The aggregate number of Units which may be
awarded under the Plan in each fiscal year of the Corporation, subject to
adjustment as provided in Section 3.2 hereof, shall be one percent (1%) of the
total outstanding Shares as of the first day of such year for which the Plan is
in effect.
(c) REISSUE OF SHARES AND UNITS. The number of Shares and Units shall
be increased in any year by the number of Shares or Units available for grant
hereunder in previous years but not subject of Awards granted hereunder in such
year. Subject to Section 8.2 hereof, if any Shares or Units subject to an Award
hereunder are forfeited or any such Award otherwise terminates without the
issuance of such Shares or Units to a Participant, or if any Shares are
surrendered by a Participant in full or partial payment of the Option Price of
an Option, such Shares or Units, to the extent of any such forfeiture,
termination or surrender, shall again be available for grant under the Plan.
3.2 ADJUSTMENTS. Subject to Section 12 hereof, the aggregate number of
Shares which may be awarded under the Plan and outstanding Awards shall be
adjusted by the Board Committee to reflect a change in the capitalization of the
Corporation, including but not limited to, a stock dividend or split,
recapitalization, reorganization, merger, consolidation, combination, exchange
of shares, spin-off, spin-out or other distribution of assets to shareholders;
provided that the number and price of shares subject to outstanding Options
granted to Non-employee Directors pursuant to Section 10 hereof and the number
of shares subject to future Options to be granted pursuant to Section 10 shall
be subject to adjustment only as set forth in Section 10 hereof.
4. ADMINISTRATION OF PLAN
4.1 ADMINISTRATION BY THE BOARD. The Plan shall be administered by the
Board Committee; PROVIDED, HOWEVER, the Board Committee may delegate some or all
of its authority and responsibility under the Plan to the Committee; PROVIDED,
FURTHER, that the Board Committee may not delegate to the Committee any
authority to make Awards hereunder to any Executive Officer who is also a member
of the Board. The Board Committee shall have authority to interpret the Plan, to
establish, amend, and rescind any rules and regulations relating to the Plan, to
prescribe the form of any agreement or instrument executed in connection
herewith, and to make all other determinations necessary or advisable for the
administration of the Plan. All such interpretations, rules, regulations and
determinations shall be conclusive and binding on all persons and for all
purposes. In addition, the Board Committee shall have authority, without
amending the Plan, to grant Awards hereunder to Participants who are foreign
nationals or employed outside the United States or both, on terms and conditions
different from those specified herein as may, in the sole judgment and
discretion of the Board Committee, be necessary
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<PAGE> 4
or desirable to further the purpose of the Plan or to comply with foreign legal
or regulatory requirements. Notwithstanding the foregoing, neither the Board,
the Board Committee nor the Committee shall have any discretion with respect to
Options granted to Non-employee Directors pursuant to Section 10 hereof.
4.2 DESIGNATION OF PARTICIPANTS. Participants shall be selected, from
time to time, by the Board Committee, from those salaried employees of the
Corporation and its affiliates who, in the opinion of the Board Committee, have
the capacity to contribute materially to the continued growth and successful
performance of the Corporation.
5. PERFORMANCE SHARE AWARDS
5.1 AWARDS. Awards of Shares may be made, from time to time, to such
salaried employees of the Corporation and its affiliates as may be selected by
the Board Committee. The release of such Shares to the Participant subject to
such Awards shall be contingent upon (i) the degree of attainment of the
applicable Performance Goals during the Performance Period relative to such
objectives as shall be established by the Board Committee and (ii) the
expiration of the Performance Period. Except as provided in Section 11 hereof
and the Performance Share Award Agreement between the Participant and the
Corporation, Shares subject to such Awards under this Section 5.1 shall be
released to the Participant only after the expiration of the relevant
Performance Period. Each Award under this Section 5.1 shall be evidenced by a
Performance Share Award Agreement between the Participant and the Corporation
which shall specify the applicable Performance Goals, the Performance Period,
any forfeiture conditions and such other terms and conditions as the Board
Committee shall determine.
5.2 STOCK CERTIFICATES. Upon expiration of the Performance Period, the
Corporation shall issue a certificate registered in the name of the Participant
or his designee evidencing the Shares to which the Participant is entitled and
release such Shares to the custody of the Participant.
5.3 RIGHTS AS SHAREHOLDERS. Subject to the provisions of the
Performance Share Award Agreement between the Participant and the Corporation,
during the Performance Period, Participants may exercise full voting rights with
respect to all Shares awarded thereto under Section 5.1 hereof and shall be
entitled to receive dividends and other distributions paid with respect to those
Shares.
5.4 TRANSFERABILITY OF SHARES. Certificates evidencing the Shares under
the Plan shall not be sold, exchanged, assigned, transferred, pledged,
hypothecated or otherwise disposed of until the expiration of the Performance
Period.
5.5 TERMINATION OF EMPLOYMENT. If a Participant ceases to be an
employee of either the Corporation or of one of its affiliates, the number of
Shares subject of the Award, if any, to which the Participant shall be entitled
shall be determined in accordance with the Performance Share Award Agreement
between the Participant and the Corporation.
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<PAGE> 5
5.6 TRANSFER OF EMPLOYMENT. If a Participant transfers employment from
one business unit of the Corporation or any of its affiliates to another
business unit during a Performance Period, such Participant shall be eligible to
receive such number of Shares as the Board Committee may determine based upon
such factors as the Board Committee in its sole discretion may deem appropriate.
5.7 INDIVIDUAL SHARE LIMITATION. The number of Shares for which a
Performance Share Award may be granted to any Participant who is an Executive
Officer shall not exceed 100,000 Shares in any fiscal year.
6. RESTRICTED STOCK AWARDS
6.1 AWARDS. Awards of Shares subject to such restrictions as to vesting
and otherwise as the Board Committee shall determine, may be made, from time to
time, to salaried employees of the Corporation and its affiliates as may be
selected by the Board Committee. The Board Committee may in its sole discretion
at the time of the Award or at any time thereafter provide for the early vesting
of such Award prior to the expiration of the Restriction Period. Each Award
under this Section 6.1 shall be evidenced by a Restricted Stock Award Agreement
between the Participant and the Corporation which shall specify the vesting
schedule, any rights of acceleration, any forfeiture conditions, and such other
terms and conditions as the Board Committee shall determine.
6.2 STOCK CERTIFICATES. Upon expiration of the Restriction Period, the
Corporation shall issue a certificate registered in the name of the Participant
or his designee evidencing the Shares to which the Participant is entitled and
release such Shares to the custody of the Participant.
6.3 RIGHTS AS SHAREHOLDERS. During the Restriction Period, Participants
may exercise full voting rights with respect to all Shares awarded thereto under
Section 6.1 hereof and shall be entitled to receive dividends and other
distributions paid with respect to those Shares.
6.4 TRANSFERABILITY OF SHARES. Certificates evidencing the Shares
awarded under the Plan shall not be sold, exchanged, assigned, transferred,
pledged, hypothecated or otherwise disposed of until the expiration of the
Restriction Period.
6.5 TERMINATION OF EMPLOYMENT. If a Participant ceases to be an
employee of either the Corporation or of any of its affiliates, the number of
Shares subject of the Award, if any, to which the Participant shall be entitled
shall be determined in accordance with the Restricted Stock Award Agreement
between the Participant and the Corporation. All remaining shares as to which
restrictions apply at the date of termination of employment shall be forfeited
subject to such exceptions, if any, authorized by the Board Committee.
7. STOCK OPTIONS
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7.1 GRANTS. Options may be granted, from time to time, to such salaried
employees of the Corporation and its affiliates as may be selected by the Board
Committee. The Option Price shall be determined by the Board Committee effective
on the Grant Date; PROVIDED HOWEVER, that such price shall not be less than one
hundred percent (100%) of the fair market value of a Share on the Grant Date.
The number of Shares subject to each option granted to each Participant, the
terms of each option, and any other terms and conditions of an Option granted
hereunder shall be determined by the Board Committee, in its sole discretion,
effective on the Grant Date; PROVIDED, HOWEVER, that no Option shall be
exercisable any later than ten (10) years from the Grant Date. Each Option shall
be evidenced by a Stock Option Agreement between the Participant and the
Corporation which shall specify the type of Option granted, the Option Price,
the term of the Option, the number of Shares to which the Option pertains, the
conditions upon which the Option becomes exercisable and such other terms and
conditions as the Board Committee shall determine.
7.2 PAYMENT OF OPTION PRICE. No Shares shall be issued upon exercise of
an Option until full payment of the Option Price therefor by the Participant.
Upon exercise, the Option Price may be paid in cash, in Shares having a fair
market value equal to the Option Price, or in any combination thereof.
7.3 RIGHTS AS SHAREHOLDERS. Participants shall not have any of the
rights of a shareholder with respect to any shares subject to an Option until
such Shares have been issued upon the proper exercise of such Option.
7.4 TRANSFERABILITY OF OPTIONS. Options granted under the Plan may not
be sold, transferred, pledged, assigned, hypothecated or otherwise disposed of
except to family members or trusts, by will or by the laws of descent and
distribution, provided that the Options may not be transferred to family members
or trusts except as permitted by applicable law or regulations. All Options
granted to a Participant under the Plan shall be exercisable during the lifetime
of such Participant only by such Participant, his agent, guardian or
attorney-in-fact.
7.5 TERMINATION OF EMPLOYMENT. If a Participant ceases to be an
employee of either the Corporation or of any of its affiliates, the Options
granted hereunder shall be exercisable in accordance with the Stock Option
Agreement between the Participant and the Corporation.
7.6 INDIVIDUAL SHARE LIMITATION. The number of Shares for which Options
may be granted to any Participant who is an Executive Officer shall not exceed
500,000 Shares over any continuous five-year period. In addition, the number of
Shares for which Options may be granted to any Participant who is an Executive
Officer upon exercise by such Participant of an Option for which the Option
Price is paid in whole or in part in Shares shall not exceed 500,000 Shares over
any continuous five-year period.
8. STOCK APPRECIATION RIGHTS
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8.1 GRANTS. Stock Appreciation Rights may be granted, from time to
time, to such salaried employees of the Corporation and its affiliates as may be
selected by the Board Committee. SARs may be granted at the discretion of the
Board Committee either (i) in connection with an Option or (ii) independent of
an Option. The price from which appreciation shall be computed shall be
established by the Board Committee at the Grant Date; PROVIDED, HOWEVER, that
such price shall not be less than one-hundred percent (100%) of the fair market
value of the number of Shares subject of the grant on the Grant Date. In the
event the SAR is granted in connection with an Option, the fixed price from
which appreciation shall be computed shall be the Option Price. Each grant of a
SAR shall be evidenced by a Stock Appreciation Rights Agreement between the
Participant and the Corporation which shall specify the type of SAR granted, the
number of SARs, the conditions upon which the SARs vest and such other terms and
conditions as the Board Committee shall determine.
8.2 EXERCISE OF SARS. SARs may be exercised upon such terms and
conditions as the Board Committee shall determine; PROVIDED, HOWEVER, that SARs
granted in connection with Options may be exercised only to the extent the
related Options are then exercisable. Notwithstanding Section 3.1 hereof, upon
exercise of a SAR granted in connection with an Option as to all or some of the
Shares subject of such Award, the related Option shall be automatically canceled
to the extent of the number of Shares subject of the exercise, and such Shares
shall no longer be available for grant hereunder. Conversely, if the related
Option is exercised as to some or all of the Shares subject of such Award, the
related SAR shall automatically be canceled to the extent of the number of
Shares of the exercise, and such shares shall no longer be available for grant
hereunder.
8.3 PAYMENT UPON EXERCISE. Upon exercise of a SAR, the holder shall be
paid in cash and/or Shares the excess of the fair market value of the number of
Shares subject of the exercise over the fixed price, which in the case of a SAR
granted in connection with an Option shall be the Option Price for such Shares.
8.4 RIGHTS OF SHAREHOLDERS. Participants shall not have any of the
rights of a shareholder with respect to any Options granted in connection with a
SAR until Shares have been issued upon the proper exercise of an Option.
8.5 TRANSFERABILITY OF SARS. SARs granted under the Plan may not be
sold, transferred, pledged, assigned, hypothecated or otherwise disposed of
except to family members or trust, by will or by the laws of descent and
distribution, provided that the SARs may not be transferred to family members or
trusts except as permitted by applicable law or regulations. All SARs granted to
a Participant under the Plan shall be exercisable during the lifetime of such
Participant only by such Participant, his agent, guardian, or attorney-in-fact.
8.6 TERMINATION OF EMPLOYMENT. If a Participant ceases to be an
employee of either the Corporation or of any of its affiliates, SARs granted
hereunder shall be exercisable in accordance with the Stock Appreciation Rights
Agreement between the Participant and the Corporation.
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8.7 INDIVIDUAL SHARE LIMITATION. The number of Shares for which SARs
may be granted to any Participant who is an Executive Officer shall not exceed
500,000 Shares over any continuous five-year period.
9. OTHER SHARE-BASED AWARDS
Awards of Shares and other awards that are valued in whole or in part
by reference to, or are otherwise based on, Shares (including, but not limited
to, phantom stock or Units, performance units, bonus stock or similar securities
or rights), may be made, from time to time, to salaried employees of the
Corporation and its affiliates as may be selected by the Board Committee. Such
Awards may be made alone or in addition to or in connection with any other Award
hereunder. The Board Committee may in its sole discretion determine the terms
and conditions of any such Award. Each such Award shall be evidenced by an
agreement between the Participant and the Corporation which shall specify the
number of Shares subject of the Award, any consideration therefor, any vesting
or performance requirements and such other terms and conditions as the Board
Committee shall determine. The number of shares or Units subject of any Awards
under this Section 9 which may be granted to a Participant who is an Executive
Officer shall not exceed 100,000 Shares or Units, as the case may be, in any
fiscal year.
10. NON-EMPLOYEE DIRECTORS' OPTIONS
10.1 GRANTS. Effective the date of the 1990 Annual Meeting of
Shareholders and on the date of each Annual Meeting thereafter, each
Non-employee Director shall automatically be granted an Option to purchase 1,000
Shares. All such Options shall be nonstatutory stock options. The Option Price
shall be one hundred percent (100%) of the fair market value of the Shares on
the date of grant.
10.2 EXERCISE OF OPTIONS. Except as set forth in this Section 10, fifty
percent (50%) of the total number of Shares subject of an Option granted to a
Non-employee Director shall become exercisable on the first anniversary of the
date of grant of the year in which the option is granted and twenty-five percent
(25%) on the anniversary date of each of the next two succeeding years. The
right to purchase Shares with respect to Shares which have become exercisable
shall be cumulative during the term of the Option. Any Option granted to
Non-employee Directors that has been outstanding for more than one (1) year
shall immediately become exercisable in the event of a Change of Control, as
hereinafter defined. The Option may be exercised by the Non-employee Director
during the period that the Non-employee Director remains a member of the Board
and for a period of three (3) years following retirement, provided that only
those Options exercisable at the date of the Non-employee Director's retirement
may be exercised during the period following retirement and, provided further,
that in no event shall the Option be exercisable more than ten (10) years after
the date of grant.
In the event of the death of a Non-employee Director, the Option shall
be exercisable only within the twelve (12) months next succeeding the date of
death, and then only (i) by the executor or administrator of the Non-employee
Director's estate or by the person or persons to whom the Non-employee
Director's rights under the Option shall pass by the Non-employee Director's
will
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or the laws of descent and distribution, and (ii) if and to the extent that the
Non-employee Director was entitled to exercise the Option at the date of the
Non-employee Director's death, provided that in no event shall the Option be
exercisable more than ten (10) years after the date of grant.
10.3 PAYMENT OF OPTION PRICE. No Shares shall be issued upon exercise
of an Option until full payment of the Option Price therefor by the Non-employee
Director. Payment for the Shares may be paid in cash, in Shares having a fair
market value equal to the Option Price, or any combination thereof.
10.4 ADJUSTMENTS. In case there shall be a merger, reorganization,
consolidation, recapitalization, stock dividend or other change in corporate
structure such that the Shares are changed into or become exchangeable for a
larger or smaller number of shares, thereafter the number of Shares subject to
outstanding Options granted to Non-employee Directors and the number of Shares
subject to Options to be granted to Non-employee Directors pursuant to the
provisions of this Section 10 shall be increased or decreased, as the case may
be, in direct proportion to the increase or decrease in the number of Shares by
reason of such change in corporate structure, provided that the number of shares
shall always be a whole number, and the purchase price per Share of any
outstanding Options shall, in the case of an increase in the number of Shares,
be proportionately reduced, and in the case of a decrease in the number of
Shares, shall be proportionately increased.
11. CHANGE OF CONTROL
11.1 DEFINITION OF CHANGE OF CONTROL. For purposes hereof, a "change
of control" shall be deemed to have occurred if:
(i) any "person" (as such term is defined in
Section 3(a)(9) of the Securities Exchange Act of 1934 (the "Exchange Act") and
as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing 20% or more of the
combined voting power of the Corporation's then outstanding securities eligible
to vote for the election of the Board (the "Corporation Voting Securities");
PROVIDED, HOWEVER, that the event described in this paragraph (i) shall not be
deemed to be a Change of Control by virtue of any of the following acquisitions:
(a) by the Corporation or any subsidiary, (b) by any employee benefit plan
sponsored or maintained by the Corporation or any subsidiary, (c) by any
underwriter temporarily holding securities pursuant to an offering of such
securities, (d) pursuant to a Non-Control Transaction (as defined in paragraph
(iii)), (e) pursuant to any acquisition by a corporate officer of the
Corporation or any group of persons including the corporate officer;
(ii) individuals who, on July 1, 1996, constitute
the Board (the "Incumbent Directors") cease for any reason to constitute at
least a majority of the Board, provided that any person becoming a director
subsequent to July 1, 1996, whose election or nomination for election was
approved by a vote of at least two-thirds of the Incumbent Directors who remain
on the Board (either by a specific vote or by approval of the proxy statement of
the Corporation in which
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such person is named as a nominee for director, without objection to such
nomination) shall also be deemed to be an Incumbent Director; provided, however,
that no individual initially elected or nominated as a director of the
Corporation as a result of an actual or threatened election contest with respect
to directors or any other actual or threatened solicitation of proxies or
consents by or on behalf of any person other than the Board of Directors shall
be deemed to be an Incumbent Director;
(iii) the consummation of a merger, consolidation,
share exchange or similar form of corporate reorganization of the Corporation or
any such type of transaction involving the Corporation or any of its
Subsidiaries that requires the approval of the Corporation's stockholders
(whether for such transaction or the issuance of securities in the transaction
or otherwise) (a "Business Combination"), unless immediately following such
Business Combination: (a) more than 80% of the total voting power of the
corporation resulting from such Business Combination (including, without
limitation, any corporation which directly or indirectly has beneficial
ownership of 100% of the Corporation Voting Securities) eligible to elect
directors of such corporation is represented by shares that were Corporation
Voting Securities immediately prior to such Business Combination (either by
remaining outstanding or being converted), and such voting power is in
substantially the same proportion as the voting power of such Corporation Voting
Securities immediately prior to the Business Combination, (b) no person (other
than any publicly traded holding Corporation resulting from such Business
Combination, any employee benefit plan sponsored or maintained by the
Corporation (or the corporation resulting from such Business Combination))
becomes the beneficial owner, directly or indirectly, of 20% or more of the
total voting power of the outstanding voting securities eligible to elect
directors of the corporation resulting from such Business Combination, and (c)
at least a majority of the members of the board of directors of the corporation
resulting from such Business Combination were Incumbent Directors at the time of
the Board's approval of the execution of the initial agreement providing for
such Business Combination (any Business Combination which satisfies the
conditions specified in (a), (b) and (c) shall be deemed to be a "Non-Control
Transaction"); or
(iv) the stockholders of the Corporation approve a
plan of complete liquidation or dissolution of the Corporation or the direct or
indirect sale or other disposition of all or substantially all of the assets of
the Corporation and its subsidiaries.
Notwithstanding the foregoing, a "change of control" of the
Corporation shall not be deemed to occur solely because any person acquires
beneficial ownership of more than 20% of the Corporation Voting Securities as a
result of the acquisition of Corporation Voting Securities by the Corporation
which reduces the number of Corporation Voting Securities outstanding; PROVIDED,
THAT if after such acquisition by the Corporation such person becomes the
beneficial owner of additional Corporation Voting Securities that increases the
percentage of outstanding Corporation Voting Securities beneficially owned by
such person, a "change of control" of the Corporation shall then occur.
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11.2 ACCELERATION OF BENEFITS. In the event of a "change of control" of
the Corporation, all outstanding Awards shall be paid in such manner and in such
amounts as determined by the Board Committee in its sole discretion at the time
such Awards are made.
12. AMENDMENT OR TERMINATION OF PLAN
Until such time as a "change of control" shall have occurred, the Board
or the Board Committee may amend, suspend or terminate the Plan or any part
thereof from time to time, provided that no change may be made which would
impair the rights of a Participant to whom Shares have theretofore been awarded
without the consent of said Participant; and provided, further, that neither the
Board nor the Board Committee may make any alteration or amendment to the Plan
which would materially increase the benefits accruing to Participants under the
Plan, increase the aggregate number of Shares which may be issued under the Plan
(other than an increase reflecting a change in capitalization of the
Corporation), change the class of employees eligible to participate in the Plan,
or amend, modify or delete Section 10 hereof, without the approval of the
shareholders of the Corporation so long as such approval is required by
applicable law or regulation. Further, Section 10 hereof may not be amended more
frequently than once every six months, except to comply with changes to the
Internal Revenue Code, the Employee Retirement Income Security Act, or the rules
promulgated thereunder. After a "change of control," the Board or the Board
Committee shall no longer have the power to amend, suspend or terminate the Plan
or any part thereof.
13. MISCELLANEOUS
13.1 RIGHTS OF EMPLOYEES. Nothing in the Plan shall interfere with or
limit in any way the right of the Corporation or any of its subsidiaries or
affiliates to terminate any Participant's employment at any time, nor confer
upon any Participant any right to continued employment with the Corporation or
any of its subsidiaries or affiliates.
13.2 WITHHOLDING FOR TAXES. The Corporation shall have the authority to
withhold, or to require a Participant to remit to the Corporation, prior to
issuance or delivery of any Shares or cash hereunder, an amount sufficient to
satisfy federal, state and local tax or withholding requirements associated with
any Award. In addition, the Corporation may, in its sole discretion, permit a
Participant to satisfy any tax withholding requirements, in whole or in part, by
(i) delivering to the Corporation Shares held by such Participant having a fair
market value equal to the amount of the tax or (ii) directing the Corporation to
retain Shares otherwise issuable to the Participant under the Plan.
13.3 STATUS OF AWARDS. Awards hereunder shall not be deemed
compensation for purposes of computing benefits under any retirement plan of the
Corporation or affiliate and shall not affect any benefits under any other
benefit plan now or hereafter in effect under which the availability or amount
of benefits is related to the level of compensation.
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13.4 WAIVER OF RESTRICTIONS. The Board Committee may, in its sole
discretion, based on such factors as the Board Committee may deem appropriate,
waive in whole or in part, any remaining restrictions or vesting requirements in
connection with any Award hereunder.
13.5 DELEGATION TO MANAGEMENT. The Board Committee may delegate to one
or more officers of the Corporation or a committee of officers the right to
grant Awards hereunder to employees who are not officers or directors of the
Corporation and to cancel or suspend Awards to employees who are not officers or
directors of the Corporation.
13.6 ADJUSTMENT OF AWARDS. Subject to Section 12, the Board Committee
shall be authorized to make adjustments in the method of calculating attainment
of Performance Goals or in the terms and conditions of other Awards (except
Options granted pursuant to Section 10 hereof) in recognition of unusual or
nonrecurring events affecting the Corporation or its financial statements or
changes in applicable laws, regulations or accounting principles; provided,
however, that no such adjustment shall impair the rights of any Participant
without his consent and that any such adjustments shall be made in a manner
consistent with Section 162(m) of the Internal Revenue Code of 1986, as amended
from time to time, and the regulations promulgated thereunder. The Board
Committee may also make Awards hereunder in replacement of, or as alternatives
to, Awards previously granted to Participants, including without limitation,
previously granted Options having higher Option Prices and grants or rights
under any other plan of the Corporation or of any acquired entity. The Board
Committee may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry it into effect. In the event the Corporation shall
assume outstanding employee benefit awards or the right or obligation to make
future such awards in connection with the acquisition of another corporation or
business entity, the Board Committee may, in its discretion, make such
adjustments in the terms of Awards under the Plan as it shall deem appropriate.
Notwithstanding the above, neither the Board, the Board Committee nor any
Committee shall have the right to make any adjustments in the terms or
conditions of Options granted pursuant to Section 10.
13.7 CONSIDERATION FOR AWARDS. Except as otherwise required in any
applicable agreement or by the terms of the Plan, Participants under the Plan
shall not be required to make any payment or provide consideration for an Award
other than the rendering of services.
13.8 DEFERRAL. Notwithstanding anything contained herein to the
contrary, in the event that any Award shall be ineligible for treatment as
"other performance based compensation" under Section 162(m) of the Internal
Revenue Code of 1986, as amended, the Board Committee, in its sole discretion,
shall have the right with respect to any Executive Officer who is in the year
any Award hereunder becomes deductible by the Corporation, a "covered employee"
under Section 162(m) of the Internal Revenue Code of 1986, as amended, to defer,
in whole or in part, such Executive Officer's receipt of such Award until the
Executive Officer is no longer a "covered employee" or until such time as shall
be determined by the Board Committee, provided that the Board Committee may
effect such a deferral only in a situation where the Corporation would be
prohibited a deduction under Section 162(m) and such deferral shall be limited
to the portion of the Award that is not deductible.
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13.9 EFFECTIVE DATE AND TERM OF PLAN. The Plan shall be effective as of
July 1, 1996. Unless terminated under the provisions of Section 12 hereof, the
Plan shall continue in effect until terminated by the Board.
Approved by the Board of Directors this 28th day of June, 1996.
Attested:
/s/ R. L. Ballantyne
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