<PAGE> 1
As filed with the Securities and Exchange Commission on December 31, 1996
File No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------------
THE GILLETTE COMPANY
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 04-1366970
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
PRUDENTIAL TOWER BUILDING
BOSTON, MASSACHUSETTS 02199
(Address of principal executive offices, including zip code)
----------------------
DURACELL SHARES PLAN
STOCK OPTION PLAN FOR KEY EMPLOYEES OF DURACELL INTERNATIONAL INC. AND
SUBSIDIARIES
----------------------
(Full title of the plans)
Jill C. Richardson
Secretary
The Gillette Company
Prudential Tower Building
Boston, Massachusetts 02199
(617) 421-7000
----------------------
(Name, Address and Telephone Number, including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------------------------
Proposed Proposed
maximum maximum Amount of
Title of securities to be Amount to be offering price per aggregate offering registration
registered registered share (1) price (1) fee
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $1.00
par value (including
Preferred Stock Purchase
Rights) 4,390,170 shares $71.625 $314,445,926 $95,286.64
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(h) on the basis of the average of the high and low sale
price of the common stock, par value $1.00 ("Common Stock"), of the Gillette
Company reported on the New York Stock Exchange Composite Transactions tape on
December 23, 1996.
================================================================================
Exhibit Index on page 9.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Note: The document(s) containing the information required by Item 1 of this
Form S-8 and the statement of availability of information of The Gillette
Company (the "Registrant"), and other information required by Item 2 of this
Form will be sent or given to employees as specified by Rule 428 under the
Securities Act of 1933, as amended (the "Securities Act"). In accordance with
Rule 428 and the requirements of Part I of Form S-8, such documents are not
being filed with the Securities and Exchange Commission (the "Commission")
either as part of this Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424. The Registrant shall maintain a file of such
documents in accordance with the provisions of Rule 428. Upon request, the
Registrant shall furnish to the Commission or its staff a copy of any or all of
the documents included in such file.
-2-
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant hereby incorporates the following documents herein by reference:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995;
(b) The Registrant's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996;
(c) The Registrant's Current Report on Form 8-K filed on September 16, 1996;
(d) The Registrant's Current Report on Form 8-K filed on December 20, 1996; and
(e) The description of the Registrant's capital stock contained in the
Registrant's Registration Statement on Form 8-A/A filed on November 12, 1996.
All documents subsequently filed by the Registrant pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold shall be deemed to be
incorporated by reference herein and to be a part hereof from the date of the
filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not required.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the shares of Common Stock offered hereby has been
passed upon for the Registrant by Joseph E. Mullaney, Vice Chairman of the
Board of Directors of the Registrant. On December 31, 1996, Mr. Mullaney
beneficially owned approximately 346,358 shares of Gillette Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law, as amended (the
"DGCL"), provides that a corporation may 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 or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that he or she 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, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amount paid in settlement actually and reasonably
incurred by him or her in connection with such
-3-
<PAGE> 4
action, suit or proceeding if he or she acted in good faith and in a manner he
or she 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 or her conduct was unlawful. Section 145
further provides that a corporation similarly may indemnify any such person
serving in any such capacity 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, against expenses
(including attorneys' fees) actually and reasonably incurred in connection with
the defense or settlement of such action or suit if he or she acted in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation, except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Delaware Court of Chancery or such other court in which such
action or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper.
Section 102(b)(7) of the DGCL permits a corporation to include in its
certificate of incorporation a provision eliminating or limiting the personal
liability of a director to the corporation or its stockholders for monetary
damages for breach of fiduciary duty as a director, provided that such
provision shall not eliminate or limit the liability of a director (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the DGCL (relating to unlawful payment of dividends and unlawful stock
purchase and redemption) or (iv) for any transaction from which the director
derived an improper personal benefit.
The Registrant's By-laws provide that the Registrant shall indemnify
current or former directors, officers, employees or agents of the Registrant,
in connection with proceedings brought against such persons by reason of their
position with the Registrant to the fullest extent permitted by Delaware law.
The Registrant's Certificate of Incorporation, as amended, provides that a
director of the Registrant shall not be liable to the Registrant or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except as is not permitted under the DGCL.
The Registrant has obtained an insurance policy that insures its
directors and officers against certain liabilities.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit
-4-
<PAGE> 5
4.1. Composite Certificate of Incorporation of The
Gillette Company, as amended, filed as Exhibit
3(a) to The Gillette Company Annual Report on
Form 10-K for the year ended December 31, 1989,
Commission File No. 1-922, incorporated by
reference herein.
4.2. By-laws of The Gillette Company, as amended April
15, 1993, filed as Exhibit 3(b) to The Gillette
Company Quarterly Report on Form 10-Q for the
period ended March 31, 1993, Commission File No.
1-922, incorporated by reference herein.
4.3. Specimen of form of certificate representing
ownership of The Gillette Company Common Stock,
$1.00 par value, as adopted by the Board of
Directors of The Gillette Company on November 21,
1996, filed herewith.
4.4. Renewed Rights Agreement dated as of December 14,
1995 between The Gillette Company and The First
National Bank of Boston, filed as Exhibit 4 to
The Gillette Company Current Report on Form 8-K,
dated December 18, 1995, Commission File No.
1-922, incorporated by reference herein.
4.5. Certificate of Designation of the Series C ESOP
Convertible Preferred Stock of The Gillette
Company, dated January 17, 1990, filed as Exhibit
4(e) to The Gillette Company Annual Report on
Form 10-K for the year ended December 31, 1989,
Commission File No. 1-922, incorporated by
reference herein.
4.6. Certificate of Amendment relating to an increase
in the amount of authorized shares of preferred
stock and common stock, filed as Exhibit 3(i) to
The Gillette Company Quarterly Report on Form
10-Q for the period ended March 31, 1995,
Commission File No. 1-922, incorporated by
reference herein.
5. Opinion of Joseph E. Mullaney, Vice Chairman of
the Board of The Gillette Company.
23. Consent of KPMG Peat Marwick LLP.
24. Power of Attorney.
99.1. Stock Option Plan For Key Employees of Duracell
International Inc. and Subsidiaries.
99.2. Duracell Shares Plan.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
-5-
<PAGE> 6
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of 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;
(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 this registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above
shall not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
-6-
<PAGE> 7
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 Boston, Massachusetts on this 31st day of
December, 1996.
By: /s/ Thomas F. Skelly
------------------------------------
Thomas F Skelly
Senior Vice President and Chief
Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities indicated
on December 31, 1996.
<TABLE>
<CAPTION>
Signatures Title
- ---------- -----
<S> <C>
* Chairman of the Board of
- -------------------------- Directors and Chief Executive
Alfred M. Zeien Officer and Director
(Principal Executive Officer)
* President, Chief Operating
- -------------------------- Officer and Director
Michael C. Hawley
* Vice Chairman of the Board of
- -------------------------- Directors and Director
Joseph E. Mullaney
* Senior Vice President and
- -------------------------- Chief Financial Officer
Thomas F. Skelly (Principal Financial Officer)
* Vice President and Controller
- --------------------------- (Principal Accounting Officer)
Charles W. Cramb
* Director
- ---------------------------
Warren E. Buffett
</TABLE>
-7-
<PAGE> 8
<TABLE>
<S> <C>
* Director
- -----------------------------
Wilbur H. Gantz
* Director
- -----------------------------
Michael B. Gifford
* Director
- -----------------------------
Carol R. Goldberg
* Director
- -----------------------------
Herbert H. Jacobi
* Director
- ------------------------------
Richard R. Pivirotto
* Director
- ------------------------------
Juan M. Steta
* Director
- ------------------------------
Alexander B. Trowbridge
* Director
- ------------------------------
Joseph F. Turley
* By: /s/ Thomas F. Skelly
----------------------
Thomas F. Skelly, for
himself and as
attorney-in-fact
</TABLE>
-8-
<PAGE> 9
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Page
------- ----
Number Description of Exhibits Number
------ ----------------------- ------
<S> <C>
4.1. Composite Certificate of Incorporation of The Gillette Company, as amended,
filed as Exhibit 3(a) to The Gillette Company Annual Report on Form 10-K
for the year ended December 31, 1989, Commission File No. 1-922,
incorporated by reference herein.
4.2 By-laws of The Gillette Company, as amended April 15, 1993, filed as
Exhibit 3(b) to The Gillette Company Quarterly Report on Form 10-Q for the
period ended March 31, 1993, Commission File No. 1-922, incorporated by
reference herein.
4.3. Specimen of form of certificate representing ownership of The Gillette
Company Common Stock, $1.00 par value, as adopted by the Board of Directors
of The Gillette Company on November 21, 1996, filed herewith.
4.4. Renewed Rights Agreement dated as of December 14, 1995 between The Gillette
Company and The First National Bank of Boston, filed as Exhibit 4 to The
Gillette Company Current Report on Form 8-K, dated December 18, 1995,
Commission File No. 1-922, incorporated by reference herein.
4.5. Certificate of Designation of the Series C ESOP ConvertiblePreferred Stock
of The Gillette Company, dated January 17, 1990, filed as Exhibit 4(e) to
The Gillette Company Annual Report on Form 10-K for the year ended December
31, 1989, Commission File No. 1-922, incorporated by reference herein.
4.6. Certificate of Amendment relating to an increase in the amount of
authorized shares of preferred stock and common stock, filed as Exhibit
3(i) to The Gillette Company Quarterly Report on Form 10-Q for the period
ended March 31, 1995, Commission File No. 1-922, incorporated by reference
herein.
5. Opinion of Joseph E. Mullaney, Vice Chairman of the Board of The Gillette
Company.
23. Consent of KPMG Peat Marwick LLP.
24. Power of Attorney.
</TABLE>
-9-
<PAGE> 10
<TABLE>
<S> <C>
99.1. Stock Option Plan For Key Employees of Duracell International Inc. and
Subsidiaries.
99.2. Duracell Shares Plan.
</TABLE>
-10-
<PAGE> 1
EXHIBIT 4.3
CERTIFICATE FOR CERTIFICATE FOR
NOT MORE THAN NOT MORE THAN
100,000 100,000
SHARES SHARES
NUMBER SHARES
COMMON STOCK COMMON STOCK
THE GILLETTE COMPANY
---INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE---
THIS CERTIFICATE IS TRANSFERABLE EITHER IN BOSTON,
MASSACHUSETTS OR IN NEW YORK, NEW YORK.
CUSIP 375766 10 2
This is to Certify that is the owner of
SPECIMEN SPECIMEN
SEE REVERSE FOR
CERTAIN DEFINITIONS
FULLY PAID AND NON-ASSESSABLE SHARES OF THE
COMMON STOCK WITH THE PAR VALUE OF $1.00 EACH
CERTIFICATE OF STOCK
of The Gillette Company transferable upon the books of the Corporation by said
owner in person or by duly authorized attorney, upon the surender of this
Certificate properly endorsed. This Certificate and the shares represented
hereby are issued and shall be held subject to all of the provisions of the
Certificate of Incorporation of the Corporation and all amendments thereto,
copies of which are on file with the Transfer Agent. This Certificate is not
valid unless countersigned by the Transfer Agent and registered by the
Registrar.
In Witness Whereof, the Corporation has caused facimiles of the
signatures of its proper officers and of its seal to be hereunto affixed.
[SEAL] Dated
The Gillette Company
By
[SIG] [SIG]
TREASURER CHAIRMAN
OF THE BOARD
COUNTERSIGNED AND REGISTERED:
THE FIRST NATIONAL BANK OF BOSTON
- TRANSFER AGENT
AND REGISTRAR.
BY
[SIG]
AUTHORIZED SIGNATURE
11-A
<PAGE> 2
This certificate also evidences and entitles the holder hereof to certain
Rights as set forth in the Renewed Rights Agreement between The Gillette Company
(the "Company") and the First National Bank of Boston (the "Rights Agent")
dated as of December 14, 1995, as the same may be amended, restated, renewed
or extended from time to time (the "Rights Agreement"), the terms of which are
hereby incorporated herein by reference and a copy of which is on file at the
principal offices of the Company. Under certain circumstances, as set forth in
the Rights Agreement, such Rights will be evidenced by separate certificates and
will no longer be evidenced by this certificate. The Company will mail to the
holder of this certificate a copy of the Rights Agreement, as in effect on the
date of mailing, without charge promptly after receipt of a written request
therefor. Under certain circumstances set forth in the Rights Agreement, Rights
beneficially owned (as such term is defined in the Rights Agreement) by any
Person who is, was or becomes an Acquiring Person or any Affiliate or Associate
thereof (as such terms are defined in the Rights Agreement), whether currently
held by or on behalf of such Person or by any subsequent holder, may become
null and void. The Rights shall not be exercisable, and shall be void so long
as held, by a holder in any jurisdiction where the requisite qualification to
the issuance to such holder, or the exercise by such holder, of the Rights in
such jurisdiction shall not have been obtained or be obtainable.
THE GILLETTE COMPANY
The Corporation will furnish without charge to each holder of any security
of the Corporation who so requests a statement of (a) the powers, designations,
preferences and relative, participating, optional or other special rights of
each class of securities or series thereof and the qualifications, limitations
or restrictions of such preferences and/or rights and (b) the terms upon which,
including the time or times at or within which, and the price of prices at
which, shares of capital stock may be purchased from the Corporation upon the
exercise of any right, option or other security of the Corporation evidenced by
this certificate, which statement is incorporated herein by reference.
The following abbreviations, when used in the inscription on the face of
this Certificate,shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C> <C> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-----------------------------
TEN ENT - as tenants by the entireties (Cust) (Minor)
under Uniform Gifts to Minors
JT TEN - as joint tenants with right of Act
survivorship and not as tenants -------------------------
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the
above list.
For value received,_______________hereby sell, assign and transfer unto
- ---------------------------------------
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
________________________________________________________________________Shares
of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _____________________________________________
Attorney to transfer the said stock in the books of the within named
Corporation with full power of substitution in the premises.
Dated,
------------------
----------------------------------
Signature Guaranteed:
--------------------------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND
LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM),
PURSUANT TO S.E.C. RULE 17Ad-15.
11-B
<PAGE> 1
EXHIBIT 5
December 31, 1996
The Gillette Company
Prudential Tower Building
Boston, Massachusetts 02199
Re: Registration Statement on Form S-8
Ladies and Gentlemen:
This opinion is furnished to you in connection with a registration statement on
Form S-8 (the "Registration Statement") filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended, for
the registration of 4,390,170 shares of common stock, $1.00 par value per share
(the "Common Stock"), of The Gillette Company, a Delaware corporation (the
"Company"), to be issued upon exercise of options (the "Options") assumed by
the Company that had previously been issued under the Duracell Shares Plan and
the Stock Option Plan for Key Employees of Duracell International Inc. and
Subsidiaries (together, the "Plans").
I am Vice Chairman of the Board and Chief Legal Officer of the Company. In that
capacity, I have acted as counsel for the Company in connection with the
assumption of the Options and I am familiar with the actions taken by the
Company in connection therewith. For purposes of this opinion, I have
examined or caused to be examined by counsel retained by or on the staff of the
Company, among other things, originals or copies, certified or otherwise
identified to my satisfaction, of such documents as I have deemed necessary or
appropriate as a basis for the opinions set forth herein.
I am a member of the bar of The Commonwealth of Massachusetts and the State of
Ohio. This opinion is limited to the federal laws of the United States of
America, the laws of The Commonwealth of Massachusetts and the General
Corporation Law of the State of Delaware.
Based upon the foregoing, I am of the opinion that the Common Stock to be
issued upon the exercise of the Options by the Company has been duly authorized
and, when issued in accordance with the Options and Plans (assuming that, at
the time of exercise of the Options, there are sufficient number of shares of
authorized but unissued shares of Common Stock or shares held in the treasury
for the shares to be issued upon exercise of the Options, and the exercise
price is not less than the par value of the Common Stock), will be legally
issued, fully paid and nonassessable.
-12-
<PAGE> 2
I consent to the filing of this opinion as an exhibit to the Registration
Statement and any amendments thereto, and to the use of my name in the
Registration Statement and any amendment thereto and in the related Prospectus.
This opinion is to be used only in connection with the issuance of the Shares
while the Registration Statement is in effect.
Very truly yours,
/s/ Joseph E. Mullaney
Joseph E. Mullaney, Esq.
-13-
<PAGE> 1
EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
To the stockholders and Board of Directors
of The Gillette Company:
We consent to the incorporation by reference in the registration statement on
Form S-8 of The Gillette Company of our report dated January 23, 1996 relating
to the consolidated balance sheets of The Gillette Company and subsidiary
companies as of December 31, 1995 and 1994, and the related consolidated
statements of income and earnings reinvested in the business and cash flows and
related schedules for each of the years in the three-year period ended December
31, 1995, which report appears or is incorporated by reference in the December
31, 1995 annual report on Form 10-K of The Gillette Company.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK
Boston, Massachusetts
December 31, 1996
-14-
<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Joseph E. Mullaney and Thomas F. Skelly,
and each of them, as his or her true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him or her and in his
or her name, place and stead, in any and all capacities, to sign a registration
statement on Form S-8 (the "Registration Statement") to by filed pursuant to
the Securities Act of 1933, as amended, by The Gillette Company, a Delaware
corporation, and any and all amendments (including post-effective amendments)
to the Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in connection therewith, as fully as to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
or his substitute or substitutes, shall do or cause to be done by virtue
hereof.
This instrument has been signed by the following persons in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- ----
<S> <C> <C>
/s/ Alfred M. Zeien Chairman of the Board of October 17, 1996
- --------------------- Directors and Chief Executive
Alfred M. Zeien Officer and Director
(Principal Executive Officer)
/s/ Michael C. Hawley President, Chief Operating October 17, 1996
- ---------------------- Officer and Director
Michael C. Hawley
/s/ Joseph E. Mullaney Vice Chairman of the Board of October 17, 1996
- ----------------------- Directors and Director
Joseph E. Mullaney
/s/ Thomas F. Skelly Senior Vice President and October 17, 1996
- --------------------- Chief Financial Officer
Thomas F. Skelly (Principal Financial Officer)
/s/ Charles W. Cramb Vice President and Controller October 17, 1996
- --------------------- (Principal Accounting Officer)
Charles W. Cramb
/s/ Warren E. Buffett Director October 18, 1996
- ----------------------
Warren E. Buffett
</TABLE>
-15-
<PAGE> 2
<TABLE>
<S> <C> <C>
/s/ Wilbur H. Gantz Director October 17, 1996
- --------------------
Wilbur H. Gantz
/s/ Michael B. Gifford Director October 17, 1996
- -----------------------
Michael B. Gifford
/s/ Carol R. Goldberg Director October 17, 1996
- ----------------------
Carol R. Goldberg
/s/ Herbert H. Jacobi Director October 17, 1996
- ----------------------
Herbert H. Jacobi
/s/ Richard R. Pivirotto Director October 17, 1996
- -------------------------
Richard R. Pivirotto
/s/ Juan M. Steta Director October 17, 1996
- ------------------
Juan M. Steta
/s/ Alexander B. Trowbridge Director October 17, 1996
- ----------------------------
Alexander B. Trowbridge
/s/ Joseph F. Turley Director October 17, 1996
- ---------------------
Joseph F. Turley
</TABLE>
-16-
<PAGE> 1
EXHIBIT 99.1
STOCK OPTION PLAN FOR KEY EMPLOYEES
OF
DURACELL INTERNATIONAL INC.
AND
SUBSIDIARIES
Duracell International Inc., a Delaware corporation, hereby adopts this
Stock Option Plan for Key Employees of Duracell International Inc. and
Subsidiaries. The purposes of this Plan are as follows:
(1) To further the growth, development and financial success of Duracell
International Inc. by providing additional incentives to certain of its key
employees who have been or will be given responsibility for the management or
administration of Duracell International Inc. and, thus, to benefit directly
from its growth, development and financial success.
(2) To enable Duracell International Inc. to obtain and retain the
services of the type of professional, technical and managerial employees
considered essential to the long-range success of Duracell International Inc.
by providing and offering them an opportunity to become owners of capital stock
of Duracell International Inc.
ARTICLE I
DEFINITIONS
Section 1.1 - General
Whenever the following terms are used in this Plan they have the meaning
specified below unless the context clearly indicates to the contrary.
Section 1.2 - Board
"Board" shall mean the Board of Directors of Duracell International.
Section 1.3 - Code
"Code" shall mean the Internal Revenue Code of 1986, as amended.
Section 1.4 - Committee
"Committee" shall mean the Stock Option Committee of the Board, appointed
as provided in Section 6.1.
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Section 1.5 - Common Stock
"Common Stock" shall mean the Common Stock, par value $0.01 per share, of
Duracell International Inc.
Section 1.6 - Director
"Director" shall mean a member of the Board.
Section 1.7 - Employee
"Employee" shall mean any employee (as defined in accordance with the
regulations and revenue rulings then applicable under Section 3401(c) of the
Code) of Duracell International Inc. or of any corporation which is then a
Subsidiary, whether such employee is so employed at the time this Plan is
adopted or becomes so employed subsequent to the adoption of this Plan.
Section 1.8 - Option
"Option" shall mean an option granted under the Plan to purchase Common
Stock. Options include only options which are not intended to be "incentive
stock options" under Section 422A of the Code.
Section 1.9 - Option Price
"Option Price" shall have the meaning given in Section 4.2.
Section 1.10 - Optionee
"Optionee" shall mean an Employee to whom an Option is granted under the
Plan.
Section 1.11 - Parent Corporation
"Parent Corporation" shall mean any corporation in an unbroken chain of
corporations ending with Duracell International Inc. if each of the
corporations other than Duracell International Inc., or if each group of
commonly controlled corporations, then owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
Section 1.12 - Plan
"Plan" shall mean this Stock Option Plan for Key Employees of Duracell
International Inc. and its Subsidiaries.
Section 1.13 - Pronouns
The masculine pronoun shall include the feminine and neuter and the
singular shall include the plural, where the context so indicates.
Section 1.14 - Secretary
"Secretary" shall mean the Secretary of Duracell International Inc.
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Section 1.15 - Subsidiary
"Subsidiary" shall mean any corporation in an unbroken chain of
corporations beginning with Duracell International Inc. if each of the
corporations, or if each group of commonly controlled corporations, other than
the last corporation in an unbroken chain then owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
Section 1.16 - Termination of Employment
"Termination of Employment" shall mean the time when the employee-employer
relationship between the Optionee and Duracell International Inc. and its
Subsidiaries is terminated for any reason whatsoever. The Committee, in its
absolute discretion, shall determine the effect of all other matters and
questions relating to Termination of Employment, including, but not by way of
limitation, all questions of whether particular leaves of absence constitute
Terminations of Employment and the question of whether any reemployment by
Duracell International Inc. is simultaneous with termination. Notwithstanding
any other provision of this Plan, Duracell International Inc. or any of its
Subsidiaries have an absolute and unrestricted right to terminate the
Employee's employment at any time for any reason whatsoever with or without
cause.
ARTICLE II
SHARES SUBJECT TO PLAN
Section 2.1 - Shares Subject to Plan
The shares of stock subject to Options shall be shares of Common Stock.
The aggregate number of shares of Common Stock which may be issued upon
exercise of options shall not exceed 10,000,000.
Section 2.2 - Unexercised Options
If any Option expires or is canceled without having been fully exercised,
the number of shares subject to such Option, but as to which such Option was
not exercised prior to its expiration or cancellation, may again be optioned
hereunder, subject to the limitations of Section 2.1.
Section 2.3 - Changes in Common Stock
In the event that the outstanding shares of Common Stock are hereafter
changed into or exchanged for a different number or kind of shares of capital
stock or other securities of Duracell International Inc., or of another
corporation, by reason of reorganization, merger, consolidation,
recapitalization, reclassification, stock split-up, stock dividend, combination
of shares or otherwise, appropriate adjustments shall be made by the Committee
in the number and kind of shares for the purchase of which Options may be
granted, including adjustment of the limitations of Section 2.1 on the maximum
number and kind of shares which may be issued upon exercise of Options.
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<PAGE> 4
ARTICLE III
GRANTING OF OPTIONS
Section 3.1 - Eligibility
Any Key Employee of Duracell International Inc. or of any Subsidiary,
including any Employee who was granted Rights under the Duracell Holdings
Corporation Equity Appreciation Rights Plan, shall be eligible to be granted
Options.
Section 3.2 - Granting of Options
The Committee shall, from time to time, in its absolute discretion:
(i) determine which Employees are key Employees and
select from among the key Employees (including those to whom Options have
been previously granted under the plan) such of them as in its opinion
shall be granted Options; and
(ii) determine the number of shares to be subject to such
Options granted to such selected key Employees; and
(iii) determine the terms and conditions of such Options,
consistent with the Plan; and
(iv) establish such conditions as to the manner of
exercise of such Options as it may deem necessary, including, but not
limited to, requiring Optionees to enter into agreements regarding
transferability and other restrictions with respect to shares issuable upon
exercise of such Options.
ARTICLE IV
TERMS OF OPTIONS
Section 4.1 - Option Agreement
Each Option shall be evidenced by a written Stock Option Agreement, which
shall be executed by the Optionee and an authorized officer of Duracell
International Inc. and which shall contain such terms and conditions as the
Committee shall determine, consistent with the Plan.
Section 4.2 - Option Price
(a) The price per share of the Common Stock subject to each Option shall
be set by the Committee; provided, however, that the price per share may be
less than the fair market value of such shares on the date such Option is
granted.
(b) For the purpose of Section 4.2(a), the fair market value of a share of
Common Stock on the date the Option is granted shall be the fair market value
established by the Committee acting in good faith.
Section 4.3 - Commencement of Exercisability
Subject to the provisions of Section 7.2, Options shall become exercisable
at such times and in such installments (which may be cumulative) as the
Committee shall provide in the terms of each individual Option; provided,
however, that by a resolution adopted after an Option is granted the Committee
may, on such terms and
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conditions as it may determine to be appropriate and subject to Section 7.2,
accelerate the time at which such Option or any portion thereof may be
exercised.
Section 4.4 - Expiration of Options
(a) No Option may be exercised to any extent by anyone after, and every
Option shall expire no later than, the expiration of ten (10) years and one (1)
day from the date the Option was granted.
(b) Subject to the provisions of Section 4.4(a), the Committee shall
provide, in the terms of each individual Option, when such Option expires and
becomes exercisable.
Section 4.5 - No Right to Continue in Employment
Nothing in this Plan or in any Stock Option Agreement hereunder shall
confer upon any Optionee any right to continue in the employ of Duracell
International Inc. or any of its Subsidiaries or shall interfere with or
restrict in any way the rights of Duracell International Inc. and its
Subsidiaries, which are hereby expressly reserved, to discharge any Optionee at
any time, for any reason whatsoever, with or without good cause.
Section 4.6 - Adjustments in Outstanding Options
In the event that the outstanding shares of Common Stock subject to Options
are, from time to time, changed into or exchanged for a different number or
kind of shares of Duracell International Inc. or other securities of Duracell
International Inc. by reason of a merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend, combination of shares, or
otherwise, the Committee shall make an appropriate and equitable adjustment in
the aggregate number of shares which may be issued pursuant to section 2.1
hereof and the number and kind of shares as to which all outstanding Options,
or portions thereof then unexercisable, shall be exercisable, to the end that
after such event the Optionee's proportionate interest shall be maintained as
before the occurrence of such event. Such adjustment in an outstanding Option
shall be made without change in the total price applicable to the Option or the
unexercised portion of the Option (except for any change in the aggregate price
resulting from rounding-off of share quantities or prices) and with any
necessary corresponding adjustment in Option Price per share. Any such
adjustment made by the Committee shall be final and binding upon all Optionees,
Duracell International Inc. and all other interested persons.
Section 4.7 - Merger, Consolidation, Exchange, Acquisition, Liquidation or
Dissolution
In its absolute discretion, and on such terms and conditions as it deems
appropriate, coincident with or after the grant of any Option, the Committee
may provide by the terms of any Option that such Option cannot be exercised
after the merger or consolidation of Duracell International Inc. into another
corporation, the exchange of all or substantially all of the assets of Duracell
International Inc. for the securities of another corporation, the acquisition
by another corporation of 80% or more of Duracell International Inc.'s then
outstanding shares of voting stock or the liquidation or dissolution of
Duracell International Inc., and if the Committee so provides, it may, in its
absolute discretion and on such terms and conditions as it deems appropriate,
also provide, either by the terms of such Option or by a resolution adopted
prior to the occurrence of such merger, consolidation, exchange, acquisition,
liquidation or dissolution, that, for some period of time prior to such event,
such Option shall be exercisable as to all shares subject thereto,
notwithstanding anything to the contrary in Section 4.3 and/or in any
installment provisions of such Option (but subject to the provisions of Section
4.5(a)) and that, upon the occurrence of such event, such Option shall
terminate and be of no further force and effect; provided, however, that the
Committee may also provide, in its absolute discretion, that even if the Option
shall remain exercisable after any such event, from and after such event, any
such Option shall be exercisable only for the kind and amount of securities and
other property (including cash), or the cash equivalent thereof, receivable as
a result of such
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<PAGE> 6
event by the holder of a number of shares of stock for which such Option could
have been exercised immediately prior to such event.
ARTICLE V
EXERCISE OF OPTIONS
Section 5.1 - Persons Eligible to Exercise
During the lifetime of the Optionee, only he or his guardian may exercise
an Option granted to him, or any portion thereof. After the death of the
Optionee, any exercisable portion of an Option may, prior to the time when such
portion becomes unexercisable under Section 4.4 or Section 4.7, be exercised by
his personal representative or by any person empowered to do so under the
deceased Optionee's will or under the then applicable laws of descent and
distribution.
Section 5.2 - Partial Exercise
At any time, and from time to time, prior to the time when any exercisable
Option or exercisable portion thereof expires or becomes unexercisable under
Section 4.4 or Section 4.7, such Option or portion thereof may be exercised in
whole or in part; provided, however, that Duracell International Inc. shall not
be required to issue fractional shares and the Committee may, in the Stock
Option Agreement, require any partial exercise to be with respect to a
specified minimum number of shares.
Section 5.3 - Manner of Exercise
An exercisable Option, or any exercisable portion thereof, may be exercised
solely by delivery to the Secretary or his office of all the following prior to
the time when such Option or such portion becomes unexercisable under Section
4.4 or Section 4.7:
(a) Notice in writing signed by the Optionee or other person then entitled
to exercise such Option or portion thereof, stating that such Option or portion
thereof is exercised; and
(b) Full payment of the Option Price (in cash or by check) for the shares
with respect to which such Option or portion thereof is thereby exercised,
together with payment or arrangement for payment of any federal income or other
tax required to be withheld by Duracell International Inc. with respect to such
shares; provided that, to the extent authorized by the Committee, payment of
the Option Price may be made by delivery of irrevocable instructions to a
financial institution to deliver promptly to Duracell International Inc. the
portion of sale or loan proceeds sufficient to pay the Option Price; and
(c) Such representations and documents as the Committee reasonably deems
necessary or advisable to effect compliance with all applicable provisions of
the Securities Act of 1933, and any other federal, state or foreign securities
laws or regulations. The Committee may, in its absolute discretion, also take
whatever additional actions it deems appropriate to effect such compliance,
including, without limitation, placing legends on share certificates and
issuing stop-transfer orders to transfer agents and registrars; and
(d) In the event that the Option or portion thereof shall be exercised
pursuant to Section 5.1 by any person or persons other than the Optionee,
appropriate proof of the right of such person or persons to exercise the Option
or portion thereof.
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<PAGE> 7
Section 5.4 - Rights as Stockholders
The holders of Options shall not be, nor have any of the rights or
privileges of, stockholders of Duracell International Inc. in respect of any
shares purchasable upon the exercise of any part of an Option unless and until
certificates representing such shares have been issued by Duracell
International Inc. to such holders.
Section 5.5 - Transfer Restrictions
The Committee, in its absolute discretion, may impose such restrictions on
the transferability of the shares purchasable upon the exercise of an Option as
it deems appropriate and any such restriction shall be set forth in the
respective Stock Option Agreement and may be referred to on the certificates
evidencing such shares.
ARTICLE VI
ADMINISTRATION
Section 6.1 - Stock Option Committee
The Committee shall consist of at least three Directors. It shall be
appointed by and shall serve at the pleasure of the Board. No person shall be
eligible to serve on the Stock Option Committee unless he is then a
"disinterested person" within the meaning of Paragraph (d)(3) of Rule 16b-3
which has been adopted by the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended, as such Rule or its equivalent is
then in effect. Appointment of Committee members shall be effective upon
acceptance of appointment. Committee members may resign at any time by
delivering written notice to the Board. Vacancies in the Committee shall be
filled by the Board.
Section 6.2 - Duties and Powers of Committee
It shall be the duty of the Committee to conduct the general administration
of the Plan in accordance with its provisions. The Committee shall have the
power to interpret the Plan and the Options and to adopt such rules for
administration, interpretation, and application of the Plan as are consistent
therewith and to interpret, amend or revoke any such rules. Any such
interpretations and rules shall be consistent with the basic purpose of the
Plan to grant Options, including Incentive Stock Options. In its absolute
discretion, the Board may at any time and from time to time exercise any and
all rights and duties of the Committee under the Plan.
Section 6.3 - Majority Rule
The Committee shall act by a majority of its members in office and the
Committee may act either by vote at a telephonic or other meeting or by a
memorandum or other written instrument signed by a majority of the Committee.
Section 6.4 - Compensation; Professional Assistance; Good Faith Actions
Members of the Committee shall not receive compensation for their services
as members, but all expenses and liabilities they incur in connection with the
administration of the Plan shall be borne by Duracell International Inc. The
Committee may employ attorneys, consultants, accountants, appraisers, brokers
or other persons. The Committee, Duracell International Inc. and the officers
and Directors of Duracell International Inc. shall be entitled to rely upon the
advice, opinions or valuations of any such persons. All actions taken and all
interpretations and determinations made by the Committee in good faith shall be
final and binding upon all Optionees, Duracell International Inc. and all other
interested persons. No member of the Committee shall be personally liable for
any action, determination or interpretation made in good faith with respect to
the Plan or the
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<PAGE> 8
Options, and all members of the Committee shall be fully protected by Duracell
International Inc. in respect to any such action, determination or
interpretation.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.1 - Options Not Transferable
No Option or interest or right therein shall be subject to disposition by
transfer, alienation, anticipation, pledge, encumbrance, assignment or any
other means, whether such disposition be voluntary or involuntary or by
operation of law or by judgment, levy, attachment, garnishment or any other
legal or equitable proceeding (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect; provided, however,
that nothing in this Section 7.1 shall prevent transfers by will or by the
applicable laws of descent and distribution.
Section 7.2 - Amendment, Suspension or Termination of the Plan
The Plan may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Board.
However, without approval of Duracell International Inc.'s stockholders given
within 12 months before or after the action by the Board or the Committee, no
action of the Committee or the Board may, except as provided in Section 2.3,
increase any limit imposed in Section 2.1 on the maximum number of shares which
may be issued upon exercise of Options, reduce the minimum Option Price
requirements in Section 4.2(a) or extend the limit imposed in this Section 7.2
on the period during which Options may be granted. Neither the amendment,
suspension nor termination of the Plan shall, without the consent of the holder
of the Option, alter or impair any rights or obligations under any Option
theretofore granted. No Option may be granted during any period of suspension
nor after termination of the Plan, and in no event may any Option be granted
under this Plan after the expiration of ten (10) years from the date the Plan
is adopted or the date the stockholders of Duracell International Inc. approve
this Plan, if earlier.
Section 7.3 - Effect of Plan Upon Other Options and Compensation Plans
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for Duracell International Inc. or any Subsidiary.
Nothing in this Plan shall be construed to limit the right of Duracell
International Inc. or any of its Subsidiaries (a) to establish any other form
of incentives or compensation for employees of Duracell International Inc. or
any of its Subsidiaries or (b) to grant or assume options otherwise than under
this Plan in connection with any proper corporate purpose, including, but not
by way of limitation, the grant or assumption of options in connection with the
acquisition by purchase, lease, merger, consolidation or otherwise, of the
business, stock or assets of any corporation, firm or association.
Section 7.4 - Titles
Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of the Plan.
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<PAGE> 1
EXHIBIT 99.2
DURACELL INTERNATIONAL INC.
DURACELL SHARES PLAN
Duracell International Inc., a Delaware corporation, hereby adopts this
Duracell Shares Plan for employees of Duracell International Inc. and its
subsidiaries and non-employee directors of Duracell International Inc. The
purposes of this Plan are as follows:
(1) To further the growth, development and financial success of the
Company by providing additional incentives to its employees and
non-employee directors.
(2) To enable the Company to attract and retain the services of
employees and non-employee directors considered essential to the long range
success of the Company by offering them an opportunity to become owners of
common stock of the Company under Options.
(3) To align the interests of the Company's employees and
non-employee directors with those of its stockholders.
(4) To provide the Company's employees and non-employee directors
with an appropriate level of reward in return for a superior level of
appreciation in the value of the Company's Common Stock.
(5) To emphasize the common interests of the Company's worldwide
employees.
ARTICLE I
DEFINITIONS
Section 1.1 - DEFINITIONS
Whenever the following terms are used in this Plan they shall have the
meaning specified below, unless the context otherwise requires.
"Board" shall mean the Board of Directors of Duracell International Inc.
"Cashless Exercise" shall mean a method of exercise under which certain
Optionees, in lieu of payment of the Option Price in cash, may choose to make
payment by instruction from such Optionees to sell shares of Common Stock
acquired upon such exercise on the open market through a duly registered
broker-dealer with which the Company makes an arrangement for the sale of such
shares of Common Stock under this Plan, such that the proceeds of such sale are
sufficient to pay the entire Option Price and the commissions of the
broker-dealer.
"Cause" shall mean an Optionee's (a) criminal conduct, (b) continuing
refusal to perform employment duties on substantially a full time basis, (c)
continuing refusal to act in accordance with any lawful instructions of a more
senior officer or employees, or (d) deliberate misconduct which could be
seriously damaging to the Company without a reasonable good faith belief by the
Optionee that his conduct was in the best interests of the Company. An
Optionee's voluntary Termination of Employment in anticipation of dismissal for
Cause shall be deemed to be a dismissal of the Optionee for Cause.
"Change of Control" shall mean any instance in which any person or group
(other than (A) KKR Associates or any of its affiliates, (B) a wholly-owned
Subsidiary of the Company or (C) one or more underwriters purchasing shares for
distribution) acquires beneficial ownership of a majority of the outstanding
Common Stock of the Company or obtains the power (i) to elect a majority of the
Board of Directors of the
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<PAGE> 2
Company or its successors or (ii) if the Company's successor is not a
corporation, to select the general partner or other person controlling the
operations and business of such successor.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Committee" shall mean the Stock Option Committee of the Board, which shall
be constituted as provided in Section 6.1.
"Common Stock" shall mean the Common Stock, par value $0.01 per share, of
the Company. To the extent the context requires, the term "Common Stock" shall
also mean any other consideration that may be issuable upon exercise of an
Option pursuant to adjustments made under Sections 2.3 and 4.6 of the Plan.
"Company" shall mean Duracell International Inc. and its successors.
Unless the context requires otherwise, the term "Company" shall also include
the Company's Subsidiaries.
"Director" shall mean a member of the Board.
"Disability" shall mean an Optionee's permanent disability, as determined
in good faith by the Committee or by an officer of the Company designated by
the Committee.
"Employee" shall mean any permanent full-time or part-time employee of the
Company (including any such employee of any Subsidiary), whether such employee
is so employed at the time this Plan is adopted or becomes so employed
subsequent to the adoption of this Plan; provided that (i) the Committee may
determine that certain employees or all employees of a particular Subsidiary
are not Employees for purposes of this Plan and (ii) the Committee may
determine that particular temporary employees, consultants or advisors of the
Company are Employees for purposes of this Plan, provided that the services
rendered by such consultants or advisory shall not be in connection with the
offer or sale of securities in a capital-raising transaction.
"Fair Market Value" on any date, shall mean the average of the high or low
sale prices per share of Common Stock on such date (or, if such date is not a
trading day, on the next preceding trading day) on the New York Stock Exchange
or such other exchange or market as shall constitute the principal trading
market for the Common Stock.
"Initial Grant Date" shall mean the date as of which Options are first
granted under the Plan.
"Non-Employee Director" shall mean a member of the Board who is not an
employee of the Company or a partner or employee of Kohlberg Kravis Roberts &
Co., L.P.
"Option(s)" shall mean an option granted under the Plan to purchase Common
Stock. Options include only options which are not intended to be "incentive
stock options" under Section 422A of the Internal Revenue Code of 1986, as
amended.
"Option Price" shall mean the purchase price for the shares of Common Stock
issuable upon exercise of an Option.
"Optionee" shall mean an Employee or Non-Employee Director to whom an
Option is granted under the Plan.
"Plan" shall mean this Duracell Shares Plan, as amended from time to time.
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<PAGE> 3
"Retirement" shall mean an Employee's or Non-Employee Director's retirement
as such at age 62 or over after having been employed by the Company or having
served as a Director for at least three years; provided that the senior human
resources officer of the Company may determine that a particular Employee's
retirement at a younger age or following a shorter term of employment with the
Company shall constitute Retirement for purposes of the Plan.
"Secretary" shall mean the Secretary of the Company.
"Subsidiary" shall mean any corporation or other entity which is controlled
by the Company, directly or through one or more intermediaries, within the
meaning of Rule 405 under the Securities Act of 1933, as amended.
"Termination of Employment" shall mean, in the case of an Employee, the
time when the employee-employer relationship between the Optionee and the
Company is terminated for any reason whatsoever and, in the case of a
Non-Employee Director, the time when the Optionee ceases to be a Director for
any reason whatsoever. The Committee, in its absolute discretion, shall
determine the effect of all other matters and questions relating to Termination
of Employment, including, but not limited to, any question concerning whether
particular leaves of absence constitute Terminations of Employment and whether
any reemployment by the Company is simultaneous with termination.
Section 1.2 - RULES OF CONSTRUCTION
The masculine pronoun shall include the feminine and the singular shall
include the plural, where the context so indicates.
ARTICLE II
SHARES SUBJECT TO PLAN
Section 2.1 - SHARES SUBJECT TO PLAN
The shares of stock subject to Options shall be shares of Common Stock.
The aggregate number of shares of Common Stock which may be issued upon
exercise of Options shall not exceed 8,000,000.
Section 2.2 - UNEXERCISED OPTIONS
If any Option expires or is canceled without having been fully exercised,
the number of shares of Common Stock subject to such Option but as to which
such Option was not exercised prior to its expiration or cancellation may again
be optioned hereunder, subject to the limitation of Section 2.1.
Section 2.3 - CHANGES IN COMMON STOCK
In the event that, after the date this Plan is adopted, the outstanding
shares of Common Stock are changed into or exchanged for a different number or
kind of shares of capital stock or other securities of the Company, or other
consideration, by reason of a merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend, combination of shares or
otherwise, the Committee shall make appropriate adjustments in the number and
kind of shares of other securities for the purchase of which Options may be
granted, including adjustment of the limitation of Section 2.1 on the maximum
number and kind of shares or other securities which may be issued upon exercise
of Options.
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ARTICLE III
GRANTING OF OPTIONS
Section 3.1 - ELIGIBILITY
Any Employee shall be eligible to be granted Options, and Options shall be
granted to each Non-Employee Director in accordance with Section 3.2(b).
Section 3.2 - GRANTING OF OPTIONS
(a) The Committee shall from time to time, in its absolute discretion:
(1) Select from among the Employees (including those to whom Options
have been previously granted under the Plan) such of them as shall be
granted Options; and
(2) Determine the number of shares of Common Stock to be subject to
Options granted to Employees; and
(3) Determine the terms and conditions of the Options, including the
Option Price, consistent with the Plan; and
(4) Establish such conditions as to the manner of exercise of the
Options as it may deem necessary, including but not limited to requiring
Optionees to enter into agreements regarding transferability and other
restrictions with respect to shares of Common Stock issuable upon exercise
of such Options.
(b) Each person who is a Non-Employee Director on the Initial Grant Date
shall be granted an Option to purchase 5,000 shares of Common Stock on the
Initial Grant Date. Each person who becomes a Non-Employee Director after the
Initial Grant Date shall be granted an Option to purchase an amount of shares
of Common Stock equal to the difference between (i) 5,000 and (ii) an amount
equal to 250 multiplied by the number of three-month periods or parts thereof
occurring from the Initial Grant Date to and including the period during which
such Director is elected to the Board (each such Option to be granted on the
date of such Director's election to the Board).
ARTICLE IV
TERMS OF OPTIONS
Section 4.1 - EVIDENCE OF EACH OPTION
Each Option shall be evidenced by a letter from a Company officer
authorized by the Committee, setting forth the terms of the Option which are
particular to the Optionee, or in such other manner as the Committee shall
determine. The Secretary, or a person appointed by the Secretary, shall
maintain a register of all outstanding Options, which shall include the date of
grant, the number of shares of Common Stock covered by the grant, the Option
Price and the name and address of the Optionee.
Section 4.2 - OPTION PRICE
Unless the Committee determines otherwise at the time of any grant, the
Option Price per share of the Common Stock subject to each Option shall be the
Fair Market Value per share on the date such Option is granted.
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<PAGE> 5
Section 4.3 - WHEN OPTIONS BECOME EXERCISABLE
Subject to the provisions of Section 4.4(b) and 4.7, unless the Committee
determines otherwise at the time of grant, each Option shall become exercisable
as follows:
(a) Except to the extent that such Option becomes exercisable sooner
pursuant to paragraph (b), each Option shall become exercisable as to 50
percent of the shares of Common Stock covered thereby on the fifth anniversary
of the Initial Grant Date and as to the balance of the shares of Common Stock
covered thereby on the sixth anniversary of the Initial Grant Date.
(b) At any time when the average Fair Market Value per share of Common
Stock for any period of 20 consecutive trading days is at least equal to the
product of the Fair Market Value per share on the Initial Grant Date times the
amount shown below under "Stock Price Multiple," Options of a particular class
shall become exercisable as to the percentage of the shares of Common Stock
covered thereby shown below under "Exercisable Percentage":
<TABLE>
<CAPTION>
Stock
Price Exercisable Percentage
Multiple Class I Class II Class III Class IV
-------- ------- -------- --------- --------
<S> <C> <C> <C> <C>
117% 25% -- -- --
137% 50% 25% -- --
160% 75% 50% 25% --
187% 100% 100% 100% 100%
</TABLE>
For purposes of the foregoing table, Options shall be assigned to
Class I if the Fair Market Value of the Common Stock on the date of grant is
less than 117% of the Fair Market Value on the Initial Grant Date; Class II, if
the Fair Market Value on the date of grant is at least 117%, but less than
137%, of the Fair Market Value on the Initial Grant Date; Class III, if the
Fair Market Value on the date of grant is at least 137%, but less than 160%, of
the Fair Market Value on the Initial Grant Date; and Class IV, if the Fair
Market Value on the date of grant is at least 160% of the Fair Market Value on
the Initial Grant Date. Notwithstanding the foregoing, no Optionee that has
been granted any option pursuant to the Stock Option Plan for Key Employees of
Duracell International Inc. and Subsidiaries as amended by Resolution of the
Board on March 4, 1991 may exercise any Option hereunder prior to June 24,
1994; provided, however, in the event a Termination of Employment has occurred
with respect to such Optionee due to death, Disability or Retirement, his
Option may be exercised without regard to such date.
(c) At any time following the first anniversary of the
Initial Grant Date, the Committee may, but shall not be required to, make such
adjustments as it considers appropriate to the terms of any or all of the then
outstanding Options. Such adjustments may include, without limitation, an
acceleration of the time at which such Option may become exercisable. In
determining whether to make any such adjustment, the Committee shall take into
account the purposes of this Plan, the financial performance of the Company and
such other considerations as it deems relevant. Following the third
anniversary of the Initial Grant Date, if no Options have then become
exercisable pursuant to Section 4.3(b), the Committee shall review the terms of
all outstanding Options to determine whether any adjustments pursuant to this
paragraph may be appropriate. Any adjustment made to an Option pursuant to
this paragraph shall not, without the consent of the holder of the Option,
adversely affect any rights or obligations of the holder of the Option in any
material respect.
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Section 4.4 - EXPIRATION OF OPTIONS; TERMINATION OF EMPLOYMENT
(a) No Option may be exercised to any extent by anyone after, and
every Option shall expire, seven years from the Option grant date.
(b) Subject to the provisions of paragraph (a), unless the
Committee determines otherwise at the time of any grant, each Option shall
contain the following terms:
(i) The Option shall expire on the seventh anniversary of the
date of grant.
(ii) The Option shall expire or become exercisable in
connection with a Termination of Employment as follows: (A) if the
Termination of Employment results from the Optionee's death,
Disability or Retirement, all Options then held by the Optionee shall
become exercisable as to all shares of Common Stock covered thereby
and may be exercised until the earlier of the first anniversary of
such Termination of Employment or their stated expiration date; (B) if
the Termination of Employment results from the Optionee's dismissal
for Cause, all Options then held by the Optionee shall automatically
expire and become unexercisable on the date of such Termination of
Employment; and (C) if the Termination of Employment results from any
other circumstances, all Options then held by the Optionee which are
exercisable on the date of Termination of Employment shall continue to
be exercisable until the earlier of 90 days after such date or their
stated expiration date, and all such Options which are not exercisable
on the date of Termination of Employment shall automatically expire on
such date.
Section 4.5 - NO RIGHT TO CONTINUE IN EMPLOYMENT; NO RIGHT TO GRANT
OF OPTIONS; NO RIGHTS AS STOCKHOLDER
Nothing in this Plan or in any Option granted hereunder shall confer
upon any Optionee any right to continue in the employ of the Company or any of
its Subsidiaries or shall interfere with or restrict in any way the rights of
the Company and its Subsidiaries, which are hereby expressly reserved, to
discharge any Optionee at any time for any reason whatsoever, with or without
cause. No Employee shall be entitled to be granted an Option under the plan,
regardless of his position or term of service with the Company, the fact that
he has been granted an Option under the Plan or stock options or other benefits
under any other benefit plan, or any other fact and circumstances. Grants of
Options shall be made in the sole and absolute discretion of the Committee. No
holder of an Option as such shall be, or shall have any of the rights and
privileges of, a holder of any shares of Common Stock.
Section 4.6 - ADJUSTMENTS IN OUTSTANDING OPTIONS
In the event that the outstanding shares of Common Stock subject to
Options are, from time to time, changed into or exchanged for a different
number or kind of shares of the Company or other consideration by reason of a
merger, consolidation, recapitalization, reclassification, stock split-up,
stock dividend, combination of shares, or otherwise, the Committee shall make
an appropriate and equitable adjustment in the number and kind of shares or
other consideration as to which all outstanding Options, or portions thereof
then unexercised, shall be exercisable. Such adjustment in an outstanding
Option shall be made without change in the total price applicable to the Option
or the unexercised portion of the Option (except for any change in the
aggregate price resulting from rounding-off of share quantities for prices) and
with any necessary corresponding adjustment in Option Price per share. Any
such adjustment made by the Committee shall be final and binding upon all
Optionees, the Company and all other interested persons.
Section 4.7 - ACCELERATION OF EXERCISABILITY IN CERTAIN EVENTS
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(a) All outstanding Options issued under the Plan shall
immediately become exercisable as to all shares of Common Stock covered thereby
in the event that (i) following, or in connection with, a Change of Control of
the Company, the Company merges with or into, or consolidates with, another
entity, or engages in a recapitalization or other similar transaction, and as a
result of the transaction the Common Stock is changed into or exchanged for
other consideration or (ii) the Company merges with or into, or consolidates
with, another entity, or engages in a recapitalization or other similar
transaction, and as a result of the transaction the Common Stock either (A) is
no longer a voting equity security of the Company or (B) is no longer listed on
a national securities exchange or authorized for quotation on an inter-dealer
quotation system of a national securities association or (iii) the Company (A)
sells, exchanges or otherwise disposes of all or substantially all of its
assets or (B) is liquidated or dissolved. For purposes of this paragraph (a),
the term "Company" shall not include any Subsidiary.
(b) The Company shall promptly notify each holder of an Option of
any event with shall cause the acceleration of all outstanding Options and of
any conversion of Options into the right to receive cash as described in the
preceding paragraph.
ARTICLE V
EXERCISE OF OPTIONS
Section 5.1 - PERSONS ELIGIBLE TO EXERCISE
During the lifetime of the Optionee, only the Optionee or the
Optionee's guardian may exercise an Option granted to the Optionee. After an
Optionee's death, any Option granted to the Optionee may, prior to the time
when such portion becomes unexercisable under Section 4.4 or Section 4.7, be
exercised by the Optionee's personal representative or by any person empowered
to do so under the deceased Optionee's will or under the then applicable laws
of descent and distribution.
Section 5.2 - PARTIAL EXERCISE
At any time and from time to time prior to the time when any
exercisable Option or exercisable portion thereof expires or becomes
unexercisable under Section 4.4 or Section 4.7, such Option or portion thereof
may be exercised in whole or in part; provided, however, that the Company shall
not be required to issue fractional shares of Common Stock and the Committee
may establish guidelines that require any partial exercise to be with respect
to a specified minimum number of shares of Common Stock.
Section 5.3 - MANNER OF EXERCISE
An exercisable Option, or any exercisable portion thereof, may be
exercised solely by delivery to the Secretary or his office, or another person
designated by him, of all of the following prior to the time when such Option
or such portion becomes unexercisable under Section 4.4 or Section 4.7:
(a) Notice from the Optionee or other person then
entitled to exercise such Option or portion thereof, stating that such Option
or portion thereof is exercised; provided that the Committee may adopt rules as
to the manner, content and timing of such notice; and
(b) Full payment of the Option Price (in cash or by check) for the
shares of Common Stock with respect to which such Option or portion thereof is
thereby exercised, together with payment or arrangement for payment of any
federal income tax or other tax required to be withheld by the Company with
respect to such shares of Common Stock; provided that with respect to certain
Optionees, subject to Section 5.4 and any related rules adopted by the
Committee, payment of the Option Price may be made by Cashless Exercise; and
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(c) Such representations and documents, if any, as the Committee
reasonably deems necessary or advisable to effect compliance with all
applicable provisions of the Securities Act of 1933, any other federal, state
or foreign securities laws or regulations. The Committee may, in its absolute
discretion, also take whatever additional actions it deems appropriate to
effect such compliance, including, without limitation, placing legends on share
certificates and issuing stop-transfer orders to transfer agents and
registrars; and
(d) In the event that the Option or portion thereof shall be
exercised pursuant to Section 5.1 by any person or persons other than the
Optionee, appropriate proof of the right of such person or persons to exercise
the Option or portion thereof.
Section 5.4 - CASHLESS EXERCISE
(a) Subject to guidelines which may be established from time to
time by the Committee, Options may be exercised by Cashless Exercise. The
Committee may at any time, however, expand or further restrict eligibility for
Cashless Exercise, amend the provisions of the Plan relating to Cashless
Exercise, or provide that Options may no longer be exercised by Cashless
Exercise, for any reason whatsoever, including without limitation, any change
in accounting principles or practices, exchange controls or applicable laws or
regulations.
(b) If Cashless Exercise is elected, the Option will be deemed to
be exercised simultaneously with the sale by the broker-dealer of shares of
Common Stock acquired on the exercise of the Option sufficient to pay the
entire Option Price and the broker-dealer's commission. If the shares of
Common Stock to be acquired on such exercise cannot be sold for a price equal
to or greater than the full Option Price plus the broker-dealer's commission,
then the Option shall not be exercised.
(c) Election of Cashless Exercise shall constitute an
authorization to the Company to deliver shares of Common Stock to the relevant
broker-dealer. The broker-dealer will remit the Option Price and the amount of
any applicable withholding taxes to the Company, and will remit any remaining
proceeds to the Optionee after withholding the broker-dealer's commission. The
broker-dealer's commission shall be for the account of the person exercising
the Option.
ARTICLE VI
ADMINISTRATION
Section 6.1 - STOCK OPTION COMMITTEE
The Committee shall consist of at least three Directors. It shall be
appointed by and shall serve at the pleasure of the Board. For as long as Rule
16b-3 under the Securities Exchange Act of 1934, as amended, or its equivalent
is then in effect with respect to the Plan, no person shall be eligible to
serve on the Committee unless he is then a "disinterested person" within the
meaning of such Rule or its equivalent as then in effect. Appointment of
Committee members shall be effective upon acceptance of appointment. Committee
members may resign at any time by delivering written notice to the Board.
Vacancies in the Committee shall be filled by the Board.
Section 6.2 - DUTIES AND POWERS OF COMMITTEE
It shall be the duty of the Committee to conduct the general
administration of the Plan in accordance with its provisions. The Committee
shall have the power to interpret the Plan and the Options and to adopt such
rules for the administration, interpretation, and application of the Plan as
are consistent therewith and to interpret, amend or revoke any such rules. Any
such interpretations and rules shall be consistent with the basic purposes of
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the Plan. In its absolute discretion, the Board may at any time, and from time
to time, exercise any and all rights and duties of the Committee under the
Plan.
Section 6.3 - COMPENSATION; PROFESSIONAL ASSISTANCE; GOOD FAITH ACTIONS
Members of the Committee shall not receive compensation for their
services as members but all expenses and liabilities they incur in connection
with the administration of the Plan shall be borne by the Company. The
Committee may employ attorneys, consultants, accountants, appraisers, brokers
or other persons. The Committee, the Company and the officers and Directors of
the Company shall be entitled to rely upon the advice, opinions or valuations
of any such persons. All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final and binding
upon all Optionees, the Company and all other interested persons. No member of
the Committee shall be personally liable for any action, determination or
interpretation made in good faith with respect to the Plan or the Options, and
all members of the Committee shall be fully protected by the Company in respect
to any such action, determination or interpretation.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.1 - OPTIONS NOT TRANSFERABLE
No Option or interest or right therein shall be subject to disposition
by transfer, alienation, anticipation, pledge, encumbrance, assignment or any
other means, whether such disposition be voluntary or involuntary or by
operation of law or by judgment, levy, attachment, garnishment or any other
legal or equitable proceeding (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect; provided, however,
that nothing in this Section 7.1 shall prevent transfers by will or by the
applicable laws of descent and distribution.
Section 7.2 - AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Plan may be wholly or partially amended or otherwise modified,
suspended or terminated at any time or from time to time by the Committee or
the Board. However, the approval of the Company's stockholders shall be
required for any modification or amendment of the Plan or outstanding Options,
which, absent such approval, would cause the Plan or outstanding Options to
fail to comply with Section 16 of the Securities Exchange Act of 1934, as
amended, or the Rules thereunder. The amendment, suspension or termination of
the Plan shall not, without the consent of the holder of an Option, adversely
affect any rights or obligations of the Optionee under any outstanding Option
in any material respect. No Option may be granted during any period of
suspension nor after termination of the Plan, and in no event may any Option be
granted under this Plan after the expiration of seven years from the date the
Plan is adopted or the date the stockholders of the Company approve this Plan,
if earlier.
Section 7.3 - EFFECT OF PLAN UPON OTHER OPTIONS AND COMPENSATION PLANS
The adoption of this Plan shall not affect any other compensation or
incentive plans in effect for the Company or any Subsidiary. Nothing in this
Plan shall be construed to limit the right of the Company or any of its
Subsidiaries (a) to establish any other forms of incentives or compensation for
employees of the Company or any of its Subsidiaries or (b) to grant or assume
options otherwise than under this Plan in connection with any proper corporate
purpose, including, but not by way of limitation, the grant or assumption of
options in connection with the acquisition by purchase, lease, merger,
consolidation or otherwise, of the business, stock or assets of any corporation
or other entity.
Section 7.4 - FOREIGN EMPLOYEES
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Notwithstanding anything to the contrary in Articles III, IV and V
(other than Section 4.4(a) and Section 5.1), the Committee may grant Options to
eligible Employees who are not United States citizens or residents on such
terms and conditions as may, in the judgment of the Committee, be necessary or
desirable to foster the purposes of the Plan. In furtherance of the purposes
of the Plan, the Committee may adopt such modifications to the terms of Options
and such procedures and guidelines, and may cause the Company to take such
other actions, as may be necessary or advisable to comply with foreign laws and
practices.
Section 7.5 - TITLES
Titles are provided herein for convenience only and are not to serve
as a basis for interpretation or construction of the Plan.
Section 7.6 - GOVERNING LAW
The laws of the State of Delaware shall govern the Plan and each
Option, regardless of the citizenship or residence of the Optionee.
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