As filed with the Securities and Exchange Commission on April 1, 1999
Registration No. 333-
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
R.H. DONNELLEY CORPORATION
(Exact name of issuer as specified in its charter)
(Formerly named The Dun & Bradstreet Corporation)
<TABLE>
Delaware 2741 13-2740040
<S> <C> <C>
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
One Manhattanville Road
Purchase, New York 10577
(914) 933-6400
(Address of principal executive offices)
</TABLE>
R.H. DONNELLEY CORPORATION
1998 PARTNERSHARE PLAN
(Full title of the plan)
Stephen B. Wiznitzer
R.H. Donnelley Corporation
Purchase, New York 10577
(914) 933-6400
(Name and address of agent for service)
Telephone number, including area code, of agent for service: (914) 933-6400
------------
<TABLE>
CALCULATION OF REGISTRATION FEE
========================================================================================================================
Amount Offering Amount of
Title Of Securities to be Price Aggregate Offering Registration
to be Registered Registered(1) Per Share(2) Price(2) Fee(2)
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock (par value $1.00 per
share)............................... 262,000 shares(3) $15.3125 $4,011,875 $1,115.30
========================================================================================================================
(1) Plus an indeterminate number of additional shares which may be offered and
issued to prevent dilution resulting from stock splits, stock dividends or
similar transactions.
(2) As of the date hereof all options to purchase shares under the 1998
PartnerShare Plan were outstanding at an aggregate exercise price of
$15.3125 per share. In accordance with Rule 457(h) under the
Securities Act of 1933, the registration fee for the foregoing shares
is based upon this exercise price.
(3) Reflects a one-for-five reverse split of the Registrant's common stock,
effective August 24, 1998.
</TABLE>
This Registration Statement Includes a Total of 18 Pages.
Exhibit Index on Page 8.
==============================================================================
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
R.H. Donnelley Corporation, formerly The Dun & Bradstreet
Corporation, (the "Registrant") hereby files this Registration Statement with
the Securities and Exchange Commission (the "Commission") on Form S-8 to
register 262,000 shares of the Registrant's Common Stock, par value $1.00 per
share ("Common Stock"), for issuance pursuant to the Registrant's 1998
PartnerShare Plan (the "Plan") and such indeterminate number of additional
shares which may be offered and issued pursuant to the Plan to prevent
dilution resulting from stock splits, stock dividends or similar transactions.
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission pursuant to
the Securities and Exchange Act of 1934, as amended (the "1934 Act"),
(Commission 1934 Act File Number 001-07155) are incorporated by reference
herein:
(1) Registrant's Annual Report and amendments thereto on Form
10-K for the fiscal year ended December 31, 1998.
(2) All other reports filed with the Commission by the
Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the 1934 Act
subsequent to the date hereof (and prior to the filing of a post-effective
amendment which indicates that all securities offered herein have been sold or
which deregisters all securities then remaining unsold).
(3) The description of the Registrant's Common Stock contained
in the following documents: Registrant's Registration Statement on Form S-3
(Registration No. 33-10462) dated November 28, 1986, including any amendment
thereto or report filed for the purpose of updating such description; and the
Registrant's Form 8-A filed with the Securities and Exchange Commission on
November 5, 1998 with respect to a rights plan adopted by the Registrant on
October 27, 1998.
Any statement contained herein or made in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Registration Statement to
the extent that a statement contained herein or in any other subsequently
filed document which is also incorporated or 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 Registration Statement.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Reference is made to section 102(b)(7) of the Delaware General
Corporation Law (the "DGCL"), which enables a corporation in its certificate
of incorporation to eliminate or limit the personal liability of a director
for violations of the director's fiduciary duty, except (i) for 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. The Registrant's
certificate of incorporation eliminates the liability of directors to the
fullest extent permitted by Delaware Law.
Reference is made to section 145 of the DGCL which provides
that a corporation may indemnify directors and officers as well as other
employees and agents against expenses (including attorney's 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 (a "derivative
action") if they act 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
respect to any criminal action or proceeding, had no reasonable cause to
believe their conduct was unlawful. A similar standard is applicable in the
case of derivative actions, except that indemnification only extends to
expenses (including attorney's fees) incurred in connection with defense or
settlement of such action, and the statute requires court approval before
there can be indemnification that may be granted by a corporation's charter,
by-laws, disinterested director vote, stockholder vote, agreement or
otherwise. The Registrant's certificate of incorporation provides for
indemnification of its directors, officers. Employees and agents to the
fullest extent permitted by Delaware Law.
In addition, the Registrant has purchased and maintains
directors' and officers' liability insurance.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
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EXHIBIT
NUMBER EXHIBIT
4.01..................... Certificate of Incorporation of the Registrant
(Incorporated herein by reference to Exhibit
3.1 to Amendment No. 1 to the Registrant's
Registration Statement on Form S-4, File No.
333-59287).*
4.02..................... Amended and Restated Bylaws of the Registrant
(Incorporated herein by reference to Exhibit
3.2 to the Registrant's Registration Statement
on Form S-4, File No. 333-59287).*
5.01..................... Opinion of Davis Polk & Wardwell.
23.01.................... Consent of Independent Public Accountants -
PricewaterhouseCoopers LLP.
23.02.................... Consent of Davis Polk & Wardwell (included in
their opinion filed as Exhibit 5.01).
24.01.................... Powers of Attorney (included on the signature
page of this registration statement).
99.01.................... Form of the R.H. Donnelley 1998 PartnerShare Plan.
</TABLE>
- ---------------
* Incorporated by reference.
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 of 1933;
(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 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 of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in this Registration
Statement; and
(iii) 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 (a)(1)(i) and (a)(1)(ii)
do not apply if the registration statement is on Form S-3,
Form S-8 or Form F-3, and 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 Securities Exchange Act of 1934 that
are incorporated by reference into this Registration
Statement;
(2) That for the purpose of determining any liability under the
1933 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; and
(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 of 1933, each
filing of the Registrant's Annual Report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and where applicable, each
filing of the Plan's annual report pursuant to Section 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.
(c) Insofar as indemnification for liabilities arising under the
1933 Act may be permitted to directors, officers or 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 1933 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 1933 Act and will be governed
by the final adjudication of such issue.
EXPERTS
The consolidated balance sheets as of December 31, 1998 and
1997 and the related consolidated statements of operations, shareholders'
equity (deficit), and cash flows for each of the three years in the period
ended December 31, 1998, incorporated by reference in this S-8, have been
incorporated herein in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
The validity of the Common Stock offered hereunder has been
passed upon by Davis Polk & Wardwell, New York, New York.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
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 Purchase, State of New York, on this
1st day of April 1999.
R.H. DONNELLEY CORPORATION
By /s/ Frank R. Noonan
-----------------------------------------
Frank R. Noonan
Chairman of the Board, President and
Chief Executive Officer
POWER OF ATTORNEY
Know all men by these present, that each person whose signature
appears below, constitutes and appoints Frank R. Noonan, Philip C. Danford and
Stephen B. Wiznitzer and each of them, our true and lawful attorneys-in-fact
and agents, with full power of substitution and resubstitution, to do any and
all acts and things and execute, in the name of the undersigned, any and all
instruments which said attorneys-in-fact and agents may deem necessary or
advisable in order to enable R. H. Donnelley Corporation to comply with the
Securities Act of 1933 and any requirements of the Securities and Exchange
Commission in respect thereof, in connection with the filing with the
Securities and Exchange Commission of the Registration Statement on Form S-8
under the Securities Act of 1933, including specifically but without
limitation, power and authority to sign the name of the undersigned to such
Registration Statement, and any amendments to such Registration Statement
(including post-effective amendments), and to file the same with all exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, to sign any and all applications, registration
statements, notices or other documents necessary or advisable to comply with
applicable state securities laws, and to file the same, together with other
documents in connection therewith with the appropriate state securities
authorities, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and to perform each and every act and
thing requisite or necessary to be done in and about the premises, as fully
and to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, and any of them, or their substitutes, may lawfully do or cause to be
done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933,
THIS REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATE INDICATED.
<TABLE>
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SIGNATURE TITLE DATE
- ------------------------- ----- ----
/s/ Frank R. Noonan Chairman of the Board of Directors, President April 1, 1999
- ------------------------- and Chief Executive Officer
Frank R. Noonan
/s/ Philip C. Danford Senior Vice President and Chief Financial April 1, 1999
- ------------------------- Officer
Philip C. Danford
/s/ Diane P. Baker Director April 1, 1999
- -------------------------
Diane P. Baker
/s/ William G. Jacobi Director April 1, 1999
- -------------------------
William G. Jacobi
/s/ Robert J. Kamerschen Director April 1, 1999
- -------------------------
Robert J. Kamerschen
/s/ Carol J. Parry Director April 1, 1999
- -------------------------
Carol J. Parry
/s/ Barry L. Williams Director April 1, 1999
- -------------------------
Barry L. Williams
/s/ Anna Patruno Vice President and Controller April 1, 1999
- -------------------------
Anna Patruno
</TABLE>
INDEX TO EXHIBITS
<TABLE>
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Exhibit
Number Exhibit
------- -------
4.01 Certificate of Incorporation of the Registrant (Incorporated herein by
reference to Exhibit 3.1 to Amendment No. 1 to the Registrant's 1933 Act
Registration Statement on Form S-4, File No. 333-59287).*
4.02 Amended and Restated Bylaws of the Registrant (Incorporated herein by
reference to Exhibit 3.2 to the Registrant's Registration Statement on Form
S-4, File No. 333-59287).*
5.01 Opinion of Davis Polk & Wardwell.
23.01 Consent of Independent Public Accountants - PricewaterhouseCoopers LLP.
23.02 Consent of Davis Polk & Wardwell (included in their opinion filed as
Exhibit 5.01).
24.01 Powers of Attorney (included on the signature page of this registration
statement).
99.01 Form of the R.H. Donnelley Corporation 1998 PartnerShare Plan.
</TABLE>
- ---------------
* Incorporated by reference.
Exhibit 5.01
[Davis Polk & Wardwell Letterhead]
April 1, 1999
R. H. Donnelley Corporation
One Manhattanville Road
Purchase, New York 10577
Dear Sirs:
We are acting as counsel for R. H. Donnelley Corporation (the
"Registrant") in connection with its Registration Statement on Form S-8 (the
"Registration Statement") to register under the Securities Act of 1933, as
amended, 262,000 shares (the "Shares") of Common Stock ($1.00 par value) of
the Registrant issuable pursuant to the 1998 PartnerShare Plan (the "Plan") of
the Registrant. In connection therewith, we have examined originals or
copies, certified or otherwise identified to our satisfaction, of such
documents, corporate records, certificates of public officials and other
instruments as we have deemed necessary for the purpose of this opinion.
Upon the basis of the foregoing, we are of the opinion that the Shares
deliverable pursuant to the Plan have been duly authorized and, when and to
the extent issued pursuant to the Plan upon receipt by the Registrant of
adequate consideration therefor, will be validly issued, fully paid and
nonassessable.
We consent to the filing of this opinion as Exhibit 5.01 to the
Registration Statement.
Very truly yours,
/s/DAVIS POLK & WARDWELL
------------------------
DAVIS POLK & WARDWELL
Exhibit 23.01
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this
registration statement of R.H. Donnelley Corporation on Form S-8 of our report
dated February 19, 1999, on our audits of the consolidated financial
statements of R. H. Donnelley Corporation as of December 31, 1998 and 1997,
and for each of the three years in the period ended December 31, 1998, which
report is incorporated by reference in the Annual Report on Form 10-K. We
also consent to the reference to our firm under the caption "Experts."
By /s/ PricewaterhouseCoopers LLP
---------------------------------
PricewaterhouseCoopers LLP
New York, New York
March 31, 1999
Exhibit 99.01
R.H. DONNELLEY CORPORATION
- ------------------------------------------------------------------------------
1998 PARTNERSHARE PLAN
- ------------------------------------------------------------------------------
R.H. DONNELLEY CORPORATION
- ------------------------------------------------------------------------------
1998 PARTNERSHARE PLAN
- ------------------------------------------------------------------------------
1. Purpose.
The purposes of the R.H. Donnelley Corporation 1998 PartnerShare Plan
(the "Plan") are to promote the interests of R.H. Donnelley Corporation
(the "Company") and its stockholders by rewarding, retaining and motivating
a broad spectrum of employees of the Company and its Subsidiaries by
enabling such employees to participate in the long-term growth and
financial success of the Company.
2. Definitions.
As used in the Plan, the following terms shall have the meanings set
forth below:
"Board" shall mean the Board of Directors of the Company.
"Cause" shall mean:
(a) At all times other than upon and during the two years
immediately following a "Change of Control":
(i) Any act or omission by the Participant constituting dishonesty,
fraud or other malfeasance at the expense of the Company or any of its
subsidiaries;
(ii) Commission of a crime classified as a felony under the laws of
the United States or any state thereof or any other jurisdiction in
which the Company or a subsidiary conducts business which materially
impairs the value of the Participant's services to the Company or any
of its subsidiaries; or
(iii) Substantial failure to observe policies of the Company or the
substantial failure of the Participant to perform assigned duties,
other than due to physical or mental incapacity.
(b) Upon and during the two years immediately following a "Change in
Control":
(i) The Participant's willful and continued failure substantially
to perform the duties of his or her position after notice and
opportunity to cure;
(ii) Any willful act or omission by the Participant constituting
dishonesty, fraud or other malfeasance, which in any such case is
demonstrably injurious to the financial condition or business
reputation of the Company or any of its affiliates; or
(iii) Commission of a crime classified as a felony under the laws
of the United States or any state thereof or any other jurisdiction in
which the Company or a subsidiary conducts business which materially
impairs the value of the Participant's services to the Company or any
of its subsidiaries;
provided, however, that, for purposes of this definition, no act or
failure to act shall be deemed "willful" unless effected by the Participant
not in good faith and without a reasonable belief that such action or
failure to act was in or not opposed to the Company's best interests, and
no act or failure to act shall be deemed "willful" if it results from any
incapacity of the Participant due to physical or mental illness.
"Change in Control" shall mean the occurrence of any of the following
events after the effective date of the Plan:
(i) Any "person," as such term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (other than the Company, any trustee or other
fiduciary holding securities under an employee benefit plan of the
Company, or any company owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportions as
their ownership of stock of the Company), is or becomes the
"Beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 20%
or more of the combined voting power of the Company's then outstanding
securities;
(ii) During any period of two consecutive years commencing on July
14, 1998, individuals who at the beginning of such period constitute
the Board, and any new director (other than a director designated by a
person (as defined above) who has entered into an agreement with the
Company to effect a transaction described in subsections (i), (iii) or
(iv) of this definition) whose election by the Board or nomination for
election by the Company's shareholders was approved by a vote of at
least two-thirds ( 2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election
or nomination for election was previously so approved cease for any
reason to constitute at least a majority thereof;
(iii) The shareholders of the Company have approved a merger or
consolidation of the Company with any other company and all other
required governmental approvals of such merger or consolidation have
been obtained, other than a merger of consolidation which would result
in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) more
than 60% of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation or a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction)
in which no person (as defined above) becomes the beneficial owner (as
defined above) of more than 20% of the combined voting power of the
Company's then outstanding securities; or
(iv) The shareholders of the Company have approved a plan of
complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company's
assets, and all other required governmental approvals of such
transaction have been obtained.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Committee" shall mean the Compensation and Benefits Committee of the
Board or such other committee of the Board as may be designated by the
Board from time to time. Any duty or responsibility allocated to the
Committee under the Plan may also be performed or exercised by the Board.
"Employee" shall mean, each employee of the Company or a Subsidiary,
as of July 14, 1998, other than an employee who participates or has been
selected to participate in the Company's 1991 Key Employees' Stock Option
Plan, as amended and restated.
"Fair Market Value" of Common Stock means, as of a given date, the
most recent closing price per share of Company Common Stock reported on a
consolidated basis for securities listed on the principal stock exchange or
market on which Stock is traded, unless the Committee shall specify an
alternative methodology for determining fair market value.
"Option" shall mean an option granted under the Plan, representing
the right to purchase Shares from the Company, in accordance with the terms
of the Plan.
"Participant" shall mean each Employee granted an Option which
remains outstanding under the Plan.
"Share" shall mean a share of common stock, par value $1.00 per
share, of the Company, or any other equity securities of the Company
substituted or resubstituted for a Share under Section 5(b).
"Subsidiary" shall mean any corporation or other entity in
which the Company possesses directly or indirectly a significant equity
interest, as determined by the Committee.
3. Administration.
The Plan shall be administered by the Committee. The Committee will
interpret this Plan and may from time to time adopt such rules and
regulations for carrying out the terms and provisions of this Plan as it
may deem best. All determinations by the Committee shall be made by the
affirmative vote of a majority of its members, but any determination
reduced to writing and signed by a majority of its members shall be fully
as effective as if it had been made by a majority vote at a meeting duly
called and held. Subject to any applicable provisions of the Company's By-
Laws or of this Plan, all determinations by the Committee pursuant to the
provisions of this Plan, and all related orders or resolutions of the
Committee, shall be final, conclusive and binding on all persons, including
the Company and its stockholders, employees and Participants.
4. Eligibility.
Each Employee shall be granted an Option hereunder in
accordance with the provisions of Section 6.
5. Authorized Shares.
(a) Shares Available for Options. Subject to adjustment as provided in
Section 5(b), the number of Shares that may be granted under the Plan shall be
1,310,000.
(b) Adjustments. In the event that the Committee determines that any
dividend or other distribution (whether in the form of cash, Shares,
Subsidiary securities, other securities or other property), recapitalization,
stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase or exchange of Shares or other
securities of the Company, issuance of warrants or other rights to purchase
Shares or other securities of the Company, or other similar corporate
transaction or event affects the Shares such that an adjustment is determined
by the Committee to be appropriate to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan,
then the Committee may, in its sole discretion and in such manner as it may
deem equitable, adjust any or all of the aggregate number of Shares
authorized for issuance in connection with Options granted hereunder, the
number of Shares subject to each outstanding Option and the vesting schedule
therefor, as set forth in Section 6, and the exercise price with respect to
any Option or, if deemed appropriate, make provision for a cash payment to the
holder of an outstanding Option.
6. Options.
(a) Options shall be granted to each Employee. Each Option shall represent
the right to purchase 1000 Shares (subject to adjustment) from the Company.
Each option shall become exercisable ("vest") with respect to 500 Shares
(subject to adjustment) on July 14, 2000, and with respect to the remaining
500 Shares (subject to adjustment) on July 14, 2001, subject to accelerated
exercisability under Section 6(b) or 6(c). Options shall expire on July 14,
2008. The exercise price per Share of each Option shall be 100% of the Fair
Market Value of a Share at the date of grant. Options shall be nonqualified
options, not intended to comply with the provisions of Section 422 of the Code.
(b) Upon termination of a Participant's employment with the Company or a
Subsidiary, the Participant's Option shall be subject to the following:
(i) Exercisability Upon Termination of Employment by Death. If a
Participant's employment by the Company or a Subsidiary terminates by
reason of death, the Option thereafter may be exercised for three
years after the date of death or the remaining stated period of the
Option, whichever period is shorter, to the full extent of the Option
regardless of the extent to which it was exercisable at the time of
death.
(ii) Exercisability Upon Termination of Employment by Disability or
Retirement. If a Participant's employment by the Company or a
Subsidiary terminates by reason of disability or retirement, the
Option thereafter may be exercised during the remaining stated period
of the Option, to the full extent of the Option regardless of the
extent to which it was exercisable at the time of termination of
employment. For purposes of this Section 6, "retirement" shall mean
voluntary termination of employment with the Company or a Subsidiary
after the Participant has attained age 55 with the approval of the
Committee or after the Participant has attained age 65. A participant
shall not be considered disabled for purposes of this Section 6 unless
he or she furnishes such medical or other evidence of the existence of
the disability as the Committee, in its sole discretion, may require.
(iii) Effect of Other Termination of Employment. If a Participant's
employment terminates for any reason other than disability, death or
retirement, if such termination is for Cause, the Option shall terminate
upon such termination of employment; and if such termination is for
reasons other than for Cause, unless otherwise determined by the
Committee, the Option shall be exercisable during the period of 90
days after such termination but in no event after the end of the
stated term of the Option and in any event only to the extent to which
the Option was exercisable at the time of termination of employment;
provided, however, that in the event of a Participant's leave of
absence, if the Participant returns to service at the scheduled ending
date of such leave of absence, the Participant's employment shall not
be considered to have terminated, and if the Participant fails to
return to service at such scheduled ending date, Participant's
employment shall be considered to have terminated at the date such
leave of absence began, in which case the Option shall be exercisable
during the period of 90 days after such termination or 30 days after
such ending date, whichever is longer, but in no event after the end
of the stated term of the Option and in any event only to the extent
to which the Option was exercisable at the time of termination of
employment.
(c) In the event of a Change in Control, each Option shall become fully
exercisable immediately upon such Change in Control.
(d) Except as otherwise provided in the Plan, an Option may be exercised
for all, or from time to time any part, of the Shares for which it is then
exercisable. The exercise price for the Shares as to which the Option is
exercised shall be paid to the Company in full, or adequate provision for such
payment made, at the time of exercise at the election of the participant in
cash, in Shares having a Fair Market Value equal to the exercise price for
the Shares being purchased and satisfying such other requirements as may be
imposed by the Committee, or partly in cash and partly in such Shares. The
Committee may permit the Participant to elect, subject to such terms and
conditions as the Committee shall determine, to have the number of Shares
deliverable to the participant as a result of the exercise reduced by a number
sufficient to pay the amount the Company determines to be necessary to
withhold for federal, state or local taxes as a result of the exercise of the
stock option. No Participant shall have any rights to dividends or other
rights of a shareholder with respect to Shares subject to an Option until the
participant has given written notice of exercise of the Option, paid in full
for such shares or made adequate provision therefor.
7. Amendments.
The Committee may amend, suspend or terminate the Plan or any
portion thereof at any time, provided that no amendment that would materially
adversely affect a Participant with respect to a vested Option shall be made
without the consent of the affected Participant.
8. General.
(a) Each Option hereunder shall be evidenced by a writing delivered to the
Participant, which need not be executed by the Participant, that shall specify
or refer to the terms and conditions thereof and any rules applicable thereto.
(b) The Company may establish appropriate procedures to provide for
payment or withholding of such income or other taxes as may be required by
law to be paid or withheld in connection with the exercise of Options, and
to ensure that the Company receives prompt advice concerning the occurrence
of any event which may create, or affect the timing or amount of, any
obligation to pay or withhold any such taxes or which may make available to
the Company any tax deduction resulting from the occurrence of such event.
(c) No Option shall be transferable by a Participant other than by will or
the laws of descent and distribution, and an Option may be exercised, during
the Participant's lifetime, only by the Participant.
(d) Nothing contained in the Plan shall prevent the Company from adopting
or continuing in effect other compensation arrangements, which may, but
need not, provide for the grant of the type of awards provided for
hereunder (subject to shareholder approval of any such arrangement if
approval is required), and such arrangements may be either generally
applicable or applicable only in specific cases.
(e) The grant of an Option shall not be construed as giving a Participant
the right to be retained in the employ of the Company or any Subsidiary. The
Company or any Subsidiary may at any time dismiss a Participant from
employment, free from any liability or any claim under the Plan, unless
otherwise expressly provided in the Plan.
(f) Each Option shall be subject to the requirement that if at any time
the Board shall be advised by counsel that the listing, registration or
qualification of the Shares subject to such Option upon any securities
exchange or under any state or federal law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a condition of, or
in connection with, the granting of such Option or the issue or purchase of
Shares thereunder, such Option may not be exercised in whole or in part unless
such listing, registration, qualification, consent or approval shall have been
effected or obtained free from any conditions not reasonably acceptable to the
Company.
(g) The validity, construction, and effect of the Plan, any rules and
regulations relating to the Plan and any Option shall be determined in
accordance with the laws of the State of New York, without regard to
provisions governing conflicts of laws, except as such matters may be governed
by the Delaware General Corporation Law and applicable federal law.
(h) If any provision of the Plan or any Option is or becomes or is deemed
to be invalid, illegal, or unenforceable in any jurisdiction or as to any
person or Option, or would disqualify the Plan or any Option under any law,
regulation or financial accounting requirement deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, regulations or accounting requirements, or if it cannot be
construed or deemed amended without, in the determination of the Committee,
materially altering the intent of the Plan or the Option, such provision shall
be stricken as to such jurisdiction, person or Option and the remainder of the
Plan and any such Option shall remain in full force and effect.
(i) Neither the Plan nor any Option shall create or be construed to
create a trust or separate fund of any kind or a fiduciary relationship
between the Company and a Participant or any other person.
(j) Headings are given to the subsections of the Plan solely as a
convenience to facilitate reference. Such headings shall not be deemed in any
way material or relevant to the construction or interpretation of the Plan or
any provision thereof.
9. Effective Date of Plan; Termination.
The Plan shall be effective as of July 14, 1998, upon its
approval by the Board. The Plan shall terminate at such time as no Options
remain outstanding hereunder.
