Registration No. 333-________
_________________________________________________________________
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
_____________
M.A. HANNA COMPANY
(Exact name of Registrant as specified in its charter)
Delaware 34-0232435
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
____________
Suite 36-5000, 200 Public Square, Cleveland, Ohio 44114-2304
(Address of principal executive office including zip code)
____________
M.A. Hanna Company 1988 Long-Term Incentive Plan
(Full title of plan)
____________
John S. Pyke, Jr., Esq.
Vice President, General Counsel and Secretary
M.A. Hanna Company
Suite 36-5000, 200 Public Square, Cleveland, OH 44114-2304
(216)589-4000
(Name and address and telephone number including area code of agent for service)
____________
CALCULATION OF REGISTRATION FEE
Title of
securities Price
to be Amount per Maximum aggregate Amount of
registered(1) registered(2) Share(3) Offering Price(3) registration fee(3)
Common Stock,
Par Value $1.00 2,860,000 $25.00 $71,500,000 $21,666
(1) In addition, pursuant to Rule 416(c) under the Securities Act
of 1933 (the "Securities Act"), this Registration Statement also
covers an indeterminate amount of interests to be offered or sold
pursuant to M.A. Hanna Company Long-Term Incentive Plan (the
"Plan").
(2) Pursuant to Rule 416 under the Securities Act, additional
shares of the Common Stock of the Company issued or which become
issuable in order to prevent dilution resulting from any future
stock split, stock dividend or similar transaction are also being
registered hereunder.
(3) Based upon the average of the high and low sales prices of
the Common Stock in the consolidated reporting system on November
6, 1997; determined in accordance with Rule 457(c) solely for the
purpose of determining the amount of the registration fee.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
This Registration Statement has been filed to register
additional securities of the Company made available under the
Plan by reason of the amendments thereto approved by the
shareholders of the Company. Pursuant to General Instruction E
to Form S-8, the contents of the Registrant's earlier
Registration Statement on Form S-8 (File No. 33-29622) effective
July 19, 1989 are incorporated herein by reference and made a
part hereof.
Item 4. Interests of Named Experts and Counsel
John S. Pyke, Jr., whose legal opinion is filed as an
exhibit to this registration statement is Vice President, General
Counsel and Secretary of the Registrant and is the beneficial
owner of approximately 51,127 shares of the Company's Common
Stock, and has received Option Rights and LTIP Units under the
Plan.
Item 5. Exhibits
5 Opinion of Counsel
23.1 Consent of Ernst & Young LLP
23.2 Consent of Price Waterhouse LLP
23.3 Consent of Counsel (included in Exhibit 5)
24 Powers of Attorney
99 M.A. Hanna Company 1988 Long-Term Incentive Plan, as
amended.
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 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 Cleveland, State of Ohio on this 7th day of November, 1997.
M.A. HANNA COMPANY
By: /s/Valerie A. Gentile
Valerie A. Gentile
Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following
persons in the capacities indicated as of the dates indicated.
Signatures Titles Date
/s/ D.J. McGregor* Chairman and Chief Executive November 7, 1997
D.J. McGregor Officer (principal executive
officer) and Director
/s/ M.S. Duffey Vice President and Chief Financial November 7, 1997
M.S. Duffey Officer (principal financial officer)
/s/ T.E. Lindsey Controller (principal accounting November 7, 1997
T.E. Lindsey officer)
/s/ B.C. Ames* Director November 7, 1997
B.C. Ames
/s/ C.A. Cartwright* Director Novewmber 7, 1997
C.A. Cartwright
/s/ W.R. Embry* Director November 7, 1997
W.R. Embry
/s/ J.T. Eyton* Director November 7, 1997
J.T. Eyton
/s/ G.D. Harnett* Director November 7, 1997
G.D. Harnett
/s/ G.D. Kirkham* Director November 7, 1997
G.D. Kirkham
/s/ D.B. Lewis* Director November 7, 1997
D.B. Lewis
/s/ M.L. Mann* Director November 7, 1997
M.L. Mann
/s/ R.W. Pogue* Director November 7, 1997
R.W. Pogue
/s/ M.D. Walker Director November 7, 1997
M. D. Walker
*Valerie A. Gentile, the undersigned attorney-in-fact, by signing
her name below, does hereby sign this registration statement on
behalf of the directors and officers of M.A. Hanna Company
indicated above by asterisk (constituting a majority of the
directors) pursuant to a power of attorney executed by such
persons and filed with the Securities and Exchange Commission
contemporaneously herewith.
By: /s/ Valerie A. Gentile
Valerie A. Gentile, as attorney-in-fact
Pursuant to the requirements of the Securities Act of 1933,
the administrators of the Plan have duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Cleveland, State of
Ohio, on November 7, 1997.
M.A. HANNA COMPANY
1988 LONG-TERM INCENTIVE PLAN
By: M.A. Hanna Company Committee for
Employee Benefits Administration
By:
Lani L. Beach
By: /s/ Thoams W. Boothe
Thomas W. Boothe
By: /s/ Michael S. Duffey
Michael S. Duffey
By: /s/ Dougls R. Schrank
Douglas R. Schrank
By: /s/ John S. Pyke, Jr.
John S. Pyke, Jr.
EXHIBIT INDEX
Exhibit Exhibit
Number
5 Opinion of Counsel
23.1 Consent of Ernst & Young LLP
23.2 Consent of Price Waterhouse LLP
23.3 Consent of Counsel (included in Exhibit 5)
24 Powers of Attorney
99 M.A. Hanna Company 1988 Long-Term Incentive Plan, as
amended
EXHIBIT 5
November 7, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: M.A. Hanna Company 1988 Long-Term Incentive Plan
Form S-8 Registration Statement
Ladies and Gentlemen:
As Vice President, General Counsel and Secretary of M.A. Hanna
Company, a Delaware corporation (the "Company"), I am familiar
with the proceedings taken, and proposed to be taken, in
connection with the M.A. Hanna Company 1988 Long-Term Incentive
Plan (the "Plan") sponsored by M.A. Hanna Company.
I have examined such documents, records and matters of law as I
have deemed necessary for the purposes of this opinion. Based on
the foregoing, I am of the opinion that (1) shares of common
stock, par value $1 each, of the Company which may be issued or
transferred and delivered pursuant to the Plan will be, when so
issued or transferred and delivered in accordance with the Plan,
duly authorized, validly issued, fully paid and nonassessable and
(2) the plan interests issuable pursuant to the Plan, when issued
upon receipt of the consideration provided for under the Plan and
in the manner contemplated by the Plan, will be validly issued,
fully paid, and nonassessable.
I hereby consent to the filing of this opinion as Exhibit 5 to
the Registration Statement on Form S-8 filed by the Company to
effect the registration under the Securities Act of 1933 of the
shares of common stock of the Company subject to the Plan and the
plan interests issuable pursuant to the Plan.
Very truly yours,
/s/John S. Pyke, Jr.
Vice President, General Counsel and Secretary
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to M.A. Hanna Company 1988 Long-
Term Incentive Plan of our report dated January 31, 1995, with
respect to the consolidated financial statements and schedule of
M.A. Hanna Company and subsidiaries for the year ended December
31, 1994 incorporated by reference in its Annual Report (Form 10-
K) for the year ended December 31, 1996, filed with the
Securities and Exchange Commission.
/S/Ernst & Young LLP
Ernst & Young LLP
Cleveland, Ohio
November 6, 1997
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to M.A. Hanna Company 1988 Long-
Term Incentive Plan of our report dated January 29, 1997, with
respect to the consolidated financial statements of M.A. Hanna
Company and subsidiaries incorporated by reference in its Annual
Report (Form 10-K) for the year ended December 31, 1996 and the
related financial statement schedules included therein, filed
with the Securities and Exchange Commission.
/S/Price Waterhouse LLP
Price Waterhouse LLP
Cleveland, Ohio
November 6, 1997
EXHIBIT 24
M. A. HANNA COMPANY
Power of Attorney
KNOW ALL MEN BY THESE PRESENTS, that M. A. Hanna Company, a
Delaware corporation (the "Company"), which anticipates filing
with the Securities and Exchange Commission, Washington, D.C.
("SEC"), under the Securities Act of 1933, as amended ("Act"), a
registration statement or registration statements on Form S-8 or
other appropriate form with respect to shares of Common Stock,
par value $1.00 per share, of the Company which may be issued or
distributed in connection with or allocated to the 1988 Long-Term
Incentive Plan, together with the Units (as defined in the Plan)
relating to such shares and each of the undersigned officers and
directors of the Company hereby constitutes and appoints
Valerie A. Gentile, John S. Pyke, Jr. and Glenn Morrical and each
of them (with full power of substitution and resubstitution) his
or her true and lawful attorney-in-fact and agent for each of
such persons and on his or her behalf and in his or her name,
place and stead, in any and all capacities, to sign, execute and
file with the SEC such registration statement(s) aforesaid under
the Act, including any amendments relating thereto with all
exhibits, and any and all documents required to be filed with any
federal or state regulatory authority including any state
securities regulatory board of commission, pertaining to the
securities subject to such registration, granting unto said
attorneys, and each of them, full power and authority to do and
perform each and every act and thing requisite and necessary to
be done in and about the premises in order to effectuate the same
as fully to all intents and purposes as each of them might or
could do if personally present, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them, or
any of their substitutes, may do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, this Power of Attorney has been signed this
5th day of November, 1997.
/s/ D. J. Mcgregor
D. J. McGregor M. S. Duffey
/s/ B. C. Ames
T. E. Lindsey B. C. Ames
/s/ C. A. Cartwright /s/ G. D. Harnett
C. A. Cartwright G. D. Harnett
/s/ J. T. Eyton /s/ W. R. Embry
J. T. Eyton W. R. Embry
/s/ M. L. Mann /s/ G. D. Kirkham
M. L. Mann G. D. Kirkham
/s/ M. D. Walker /s/ R. W. Pogue
M. D. Walker R. W. Pogue
/s/ D. B. Lewis
D. B. Lewis
M.A. HANNA COMPANY
1988 Long-Term Incentive Plan, as Amended
(to May 7, 1997)
1. Purpose. The purpose of this Plan is to attract,
retain and motivate executive personnel for M.A. Hanna
Company (the "Company") and its Subsidiaries and to provide
to such executives incentives and rewards for superior
performance and contribution.
2. Definitions. As used in this Plan,
(a) The term "Appreciation Right" means a right
granted pursuant to Paragraph 5 of this Plan.
(b) The term "Award Value" with respect to any LTIP
Unit means an amount expressed in dollars or expressed in
shares of Common Stock, such number of shares determined by
dividing the dollar target value of the award by the Market
Value per Share at the time of the award, as adjusted by the
Board of Directors to reflect risk and other factors, in
either case as established by the Board of Directors in
connection with the award of such LTIP Unit.
(c) The term "Common Stock" means Common Stock, par
value $1.00 per share, of the Company or any security into
which such Common Stock may be changed by reason of any
transaction or event of the type described in Paragraph 9 of
this Plan.
(d) The term "Dividend Credit" means a credit
contingently granted pursuant to Paragraph 7 of this Plan.
(e) The term "Eligible Employees" means persons who
are selected by the Board of Directors and who are at the
time officers (including officers who are members of the
Board of Directors) and other key employees of the Company
or any of its Subsidiaries.
(f) The term "LTIP Unit" means a unit awarded pursuant
to Paragraph 6 of this Plan.
(g) The term "Management Objectives" means the
achievement objectives established pursuant to Paragraph
6(b) of this Plan for Eligible Employees who have received
grants of LTIP Units.
(h) The term "Market Value per Share" means, at any
date, the closing sale price of the Common Stock on that
date (or, if there are no sales on that date, the last
preceding date on which there was a sale) on the New York
Stock Exchange or the consolidated tape as reported by The
Wall Street Journal.
(i) The term "Maximum" means 200% of the Award Value
of an LTIP Unit.
(j) The term "Minimum" means the minimum level of
achievement of Management Objectives established pursuant to
Paragraph 6(b) of this Plan.
(k) The term "Optionee" means the optionee named in an
agreement evidencing an outstanding Option Right.
(l) The term "Option Right" means the right to
purchase a share of Common Stock upon exercise of an option
granted pursuant to Paragraph 4 of this Plan.
(m) The term "Payment Value" means the value of an
LTIP Unit at the time of payment as determined in accordance
with Paragraph 6(d) and (e) of this Plan.
(n) The term "Performance Period" means, in respect of
any LTIP Unit, a period of time established pursuant to
Paragraph 6(b)of this Plan within which the Management
Objectives relating to such LTIP Unit are to be achieved.
(o) The term "Spread" means the excess of the Market
Value per Share of Common Stock on the date when an
Appreciation Right is exercised over the option price
provided for in the related Option Right.
(p) The term "Subsidiary" means any corporation or
partnership in which at the time the Company owns or
controls, directly or indirectly, not less than 80% of the
total combined voting power represented by all classes of
stock issued by such corporation or 80% of the general
partners' equity of such partnership, as the case may be.
(q) The term "Restricted Stock" means Restricted Stock
awarded pursuant to Paragraph 15 of the Plan.
3. Shares Available Under Plan. The shares of Common
Stock which may be sold or delivered upon exercises of
Option Rights or Appreciation Rights, upon the payment of
the Payment Value of an LTIP Unit, upon the payment of any
Dividend Credit or upon the grant of any Restricted Stock
shall not exceed the sum of 3,400,000 plus such number of
shares of Common Stock authorized for sale or delivery under
the Company's Restated 1979 Executive Incentive Compensation
Plan that remain unutilized under that Plan upon termination
thereof, which sum shall be subject to adjustment as
provided in Paragraph 9 of this Plan. Such shares may be
shares of original issuance, treasury shares, shares from
the Associates Ownership Trust or a combination of the
foregoing.
4. Grants of Option Rights. The Board of Directors
may, from time to time and upon such terms and conditions as
it may determine, authorize the granting to Eligible
Employees of options to purchase shares of Common Stock.
Each such grant may utilize any or all of the
authorizations, and shall be subject to all of the
limitations, contained in the following provisions:
(a) Each grant shall specify the number of shares of
Common Stock to which it pertains; provided, however, that
no Eligible Employee shall be granted Option Rights for more
than 100,000 shares of Common Stock in any one fiscal year
of the Company, subject to adjustments as provided in
Section 9 of this Plan.
(b) Each grant shall specify an option price per share
equal to the market Value per Share on the date of grant
except that in the case of a grant to a newly employed
Eligible Employee the grant may, if the Board of Directors
so determines, specify an option price per share equal to
the Market Value per Share on the first date of such
Eligible Employee's employment.
(c) Each grant shall specify that the option price
shall be payable at the time of exercise (i) in cash or by
check acceptable to the Company, (ii) by delivery to the
Company of shares of Common Stock that have been owned by
the Optionee not less than six months equal in value to the
option price (such shares to be valued for this purpose at
their Market Value per Share on the date of exercise) or
(iii) a combination of the foregoing, as may be selected by
the Optionee at the time of exercise. The Board of
Directors may provide for the deferred payment of the option
price from the proceeds of sale through a broker of some or
all of the shares of Common Stock to which any exercise
relates.
(d) Successive grants may be made to the same Eligible
Employee whether or not any Option Rights previously granted
to such Eligible Employee remain unexercised.
(e) Each grant shall specify the maximum period, not
in excess of 10 years from the date of grant, during which
the Option Rights shall continue in effect.
(f) Each grant shall specify the period or periods of
continuous employment by the Optionee with the Company or
any Subsidiary which are necessary before the Option Rights
or installments thereof will become exercisable. Any grant
may permit acceleration of exercisability upon the
occurrence of specified events and may permit acceleration
of exercisability after termination of the Optionee's
employment but not beyond 10 years from the date of grant,
as follows: in the event of the Optionee's termination due
to disability or retirement with the Company's consent, up
to 5 years after termination or retirement; in the event of
the Optionee's death, up to 1 year from the date of death;
and in the event of any other termination, up to 30 days
from the date of termination.
(g) Option Rights granted under this Plan may be (i)
options which are intended to qualify under particular
provisions of the Internal Revenue Code, as in effect from
time to time, (ii) options which are not intended to so
qualify, or (iii) combinations of the foregoing.
(h) The date of grant of each Option Right shall be
the date of its authorization by the Board of Directors.
(i) Each grant of Option Rights shall be evidenced by
an agreement executed on behalf of the Company by any
officer and delivered to and accepted by the Eligible
Employee and shall contain such terms and provisions,
consistent with this Plan, as the Board of Directors may
approve.
5. Grants of Appreciation Rights. The Board of
Directors may also authorize the granting to Eligible
Employees of Appreciation Rights in respect of Option Rights
granted hereunder or under any other stock option plan
approved by the shareholders of the Company. An
Appreciation Rights shall be a right of the Optionee,
exercisable by surrender of the related Option Right, to
receive from the Company an amount which shall be determined
by the Board of Directors and shall be expressed as a
percentage of the Spread (not exceeding 100%) at the time of
exercise. Each such grant may utilize any or all of the
authorizations, and shall be subject to all of the
limitations, contained in the following provisions:
(a) Any grant may specify that the amount payable on
exercise of an Appreciation Right may be paid by the Company
in cash, in shares of Common Stock, or any combination
thereof, and may either grant to the Optionee or retain in
the Board of Directors the right to elect among those
alternatives.
(b) Any grant may specify that the amount payable on
exercise of an Appreciation Right (valuing shares of Common
Stock for this purpose at their Market Value per Share at
the date of exercise) may not exceed a maximum specified by
the Board of Directors at the date of grant.
(c) Any grant may specify waiting periods before
exercise and permissible exercise dates or periods. No
Appreciation Right shall be exercisable except at a time
when the related Option Rights is also exercisable.
(d) Upon exercise of any Option Right, the related
Appreciation Right shall automatically be cancelled; upon
exercise of any Appreciation Right, the related Option Right
shall automatically be cancelled.
(e) Each grant of an Appreciation Right shall be
evidenced by a notification executed on behalf of the
Company by any officer and delivered to and accepted by the
Optionee, which notification shall describe such
Appreciation Right, identify the related Option Right, state
that such Appreciation Right is subject to all the terms and
conditions of this Plan, and contain such other terms and
provisions, consistent with this Plan, as the Board of
Directors may approve.
6. Grants of LTIP Units. The Board of Directors may
also authorize the granting to Eligible Employees of LTIP
Units. Each such grant may utilize any or all of the
authorizations, and shall be subject to all of the
limitations, contained in the following provisions:
(a) The Award Value of each LTIP Unit shall be
established in connection with its grant.
(b) The Performance Period with respect to each LTIP
Unit shall be such period of time as shall be determined by
the Board of Directors in connection with its grant. The
Performance Period shall not be less than three years except
that the Board of Directors may provide for premature
termination of the Performance Period in respect of
outstanding grants of LTIP Units in connection with any
event or transaction of the types described in Paragraph 9
of this Plan.
(c) LTIP Units shall be deemed earned by an Eligible
Employee based upon achievement by him or her of the
management objectives specified by the Board of Directors in
connection with the grant (the "Management Objectives").
Such Management Objectives may be described in terms of
Company-wide objectives (including but not limited to
achievement of specified increases of earnings per share of
Common Stock or return on stockholders' equity or some
combination thereof) or of objectives which are related to
performance of the division or subsidiary within the Company
in which such Eligible Employee is employed. Management
Objectives related to any particular grant of LTIP Units
need not be the same as those relating to any other grant,
whether made at the same or a different time. The Board of
Directors shall specify in connection with each grant of
LTIP Units a minimum acceptable level of achievement of the
relevant Management Objectives (the "Minimum"). If during
the Performance Period relating to any LTIP Units events or
transactions should occur which, in the sole judgment of the
Board of Directors, are unrelated to the performance of the
Eligible Employee and result in distortion of the Management
Objectives or Minimum relating to such LTIP Unit, the Board
of Directors may adjust such Management Objectives or
Minimum upward or downward to eliminate such distortion.
(d) The Board of Directors shall, promptly after the
date on which the necessary financial or other information
for a particular Performance Period becomes available,
determine the extent to which the LTIP Unit to which such
Performance Period relates has been earned by the Eligible
Employee through achievement of the relevant Management
Objectives, in accordance with the following:
(i) If the Management Objectives have been
attained, the Eligible Employee shall be deemed to have
earned 100% of the Award Value of such LTIP Unit. If
the Management Objectives have been exceeded, or if the
Management Objectives have not been attained but the
relevant Minimum has been attained or exceeded, the
percentage of the LTIP Unit deemed earned by the
Eligible Employee may be a higher or lower percentage
of the Award Value as determined in accordance with a
formula prescribed by the Board of Directors at the
time such LTIP Unit was granted, but not in excess of
the Maximum. If the Minimum has not been attained, the
Eligible Employee shall be deemed not to have earned
the LTIP Unit.
(ii) If an Eligible Employee's employment has
terminated because of death, disability or retirement
at or after normal retirement age (or earlier with the
consent of the Board of Directors) under a retirement
plan of the Company or a Subsidiary prior to the end of
the Performance Period, the extent to which an LTIP
Unit shall be deemed to have been earned, as calculated
at the end of the Performance Period, shall be
determined as if such Eligible Employee's employment
had not terminated and the result shall be multiplied
by a fraction, the numerator of which is the number of
days such Eligible Employee was employed during the
Performance Period and the denominator of which is the
total number of days in the Performance Period. If an
Eligible Employee's employment terminates for any
reason other than as described in the preceding
sentence, the Eligible Employee shall be deemed not to
have earned the LTIP Unit unless the Board of Directors
determines otherwise in its sole discretion (in which
event the extent to which the LTIP Unit shall be deemed
to have been earned shall not exceed the amount
determined pursuant to the preceding sentence).
(e) The Payment Value of any LTIP Unit shall be equal
to the Award Value times the percentage thereof (not in
excess of the Maximum) deemed earned by the Eligible
Employee as determined pursuant to Paragraph 6(d) of this
Plan.
(f) Not later than 15 days after a determination has
been made pursuant to Paragraph 6(d) of this Plan with
respect to any LTIP Unit, the Board of Directors shall cause
the Eligible Employee to be notified in writing of such
determination and shall cause the Payment Value of such LTIP
Unit to be paid to the Eligible Employee in cash or in
shares of Common Stock, or in any combination thereof. For
purposes hereof, shares of Common Stock shall be valued at
their Market Value per Share on the date the Board of
Directors determines the extent to which the LTIP Unit has
been earned.
(g) Each grant of an LTIP Unit shall be evidenced by a
notification executed on behalf of the Company by any
officer and delivered to and accepted by the Optionee, which
notification shall describe such LTIP Unit, state that such
LTIP Unit is subject to all the terms and conditions of this
Plan, and contain such other terms and provisions,
consistent with this Plan, as the Board of Directors may
approve.
7. Dividend Credits. No Dividend Credits will be
allocated under the Plan on or after May 4, 1994. All
Dividend Credits allocated prior to May 4, 1994 shall be
governed by the Plan as in effect prior to such date.
8. Transferability. No Option Right, Appreciation
Right, LTIP Unit, Restricted Stock or Dividend Credit shall
be transferable by an Optionee or grantee other than by will
or the laws of descent and distribution except that the
Compensation Committee may in its sole discretion approve a
transfer of Option Rights by an Optionee to members of the
Optionee's family or to a trust for the benefit of the
Optionee or members of the Optionee's family. Option Rights
and Appreciation Rights shall be exercisable during the
Optionee's lifetime only by the Optionee or by his or her
guardian or legal representative or, in the case of a
transfer of the Option Rights to members of the Optionee's
family or to a trust for the benefit of the Optionee or
members of the Optionee's family, shall be exercisable by
the transferee or its legal representative.
9. Adjustments. The Board of Directors may make or
provide for such adjustments in the maximum number of shares
specified in Paragraph 3 of this Plan, in the numbers of
shares of Common Stock covered by outstanding Option Rights
and Appreciation Rights granted hereunder, and in the prices
per share applicable to such Option Rights and Appreciation
Rights, as such Board in its sole discretion, exercised in
good faith, may determine is equitably required to prevent
dilution or enlargement of the rights of Optionees that
otherwise would result from any stock dividend, stock split,
combination of shares, recapitalization or other change in
the capital structure of the Company, merger, consolidation,
spin-off, reorganization, partial or complete liquidation,
issuance of rights or warrants to purchase securities, or
any other corporate transaction or event having an effect
similar to any of the foregoing.
10. Fractional Shares. The Company shall not be
required to issue any fractional share of Common Stock
pursuant to this Plan. The Board of Directors may provide
for the elimination of fractions or for the settlement of
fractions in cash.
11. Withholding Taxes. The Company shall have the
right to deduct from any payment under this Plan an amount
equal to the federal, state and local taxes required to be
withheld by it with respect to such payment and, if the cash
portion of any such payment is less than the amount of taxes
required to be withheld, to require the Optionee or other
person receiving such payment, as a condition of and prior
to such payment, to pay to the Company the balance of such
taxes so required to be withheld.
12. Administration of the Plan.
(a) This Plan shall be administered by the Board of
Directors, which may from time to time delegate all or any
part of its authority under this Plan to a Compensation
Committee of not less than three Directors appointed by the
Board of Directors, each of whom shall be a "disinterested
person" within the meaning of Rule 16b-3 of the Securities
and Exchange Commission or any successor rule to the same
effect ("Rule 16b-3"). To the extent of such delegation,
references herein to the "Board of Directors" shall include
the Committee. A majority of the Committee shall constitute
a quorum, and the action of the members of the Committee
present at any meeting at which a quorum is present, or acts
unanimously approved in writing, shall be acts of the
Committee.
(b) The interpretation and construction by the Board
of Directors of any provision of this Plan or of any
agreement, notification or document evidencing the grant of
Option Rights, Appreciation Rights, LTIP Units or Dividend
Credits and any determination by the Board of Directors
pursuant to any provision of this Plan or of any such
agreement, notification or document shall be final and
conclusive. No member of the Board of Directors shall be
liable for any such action or determination made in good
faith.
13. Amendments, Etc.
(a) This Plan may be amended from time to time by the
Board of Directors but without further approval by the
stockholders of the Company no such amendment shall (i)
increase the maximum number of shares specified in Paragraph
3 of the Plan (except that adjustments authorized by
Paragraph 9 of this Plan shall not be limited by this
provision), (ii) change the definition of "Eligible
Employees," or (iii) cause Rule 16b-3 to become inapplicable
to this Plan.
(b) The Board of Directors may, with the concurrence
of the affected Optionee, cancel any agreement evidencing
Option Rights granted under this Plan. In the event of such
cancellation, the Board of Directors may authorize the
granting of new Option Rights (which may or may not cover
the same number of shares which had been the subject of the
prior agreement) in such manner, at such option price and
subject to the same terms, conditions and discretions as,
under this Plan, would have been applicable had the
cancelled Option Rights not been granted.
(c) In case of termination of employment by reason of
death, disability or retirement at or after normal
retirement age (or earlier with the consent of the Board of
Directors) under a retirement plan of the Company or a
Subsidiary of an Optionee who holds an Option Right or
Appreciation Right not immediately exercisable in full, the
Board of Directors may, in its sole discretion, accelerate
the time at which such Option Right or Appreciation Right
may be exercised.
14. Termination of 1979 Plan. The Company's 1979
Executive Incentive Compensation Plan shall be terminated as
of the date of approval of this Plan by the stockholders of
the Company but without prejudice to any award outstanding
thereunder.
15. Grants of Restricted Stock. The Board of
Directors may also authorize the granting to Eligible
Employees of shares of Common Stock designated as restricted
(hereafter "Restricted Stock"). Each such grant may utilize
any or all of the authorizations, and shall be subject to
all of the limitations, contained in the following
provisions:
(a) The Restricted Stock shall be subject to such
restrictions on transfer and risk of forfeiture as the Board
of Directors may impose, which restrictions may lapse or
expire separately or in combination at such time or times,
in such installments or otherwise, as the Board of Directors
may deem appropriate.
(b) Any Restricted Stock granted under the Plan may be
evidenced in such manner as the Board of Directors may deem
appropriate, including, without limitation, book-entry
registration or issuance of a stock certificate or
certificates. In the event any stock certificate is issued
in respect of the Restricted Stock granted under the Plan,
such certificate shall be registered in the name of the
Eligible Employee and shall bear an appropriate legend
referring to the terms, conditions and restrictions
applicable to such Restricted Stock.
(c) Except as otherwise determined by the Board of
Directors, upon attainment of a predetermined event as
established by the Board of Directors for any reason during
the applicable restriction period, all Restricted Stock of
the Eligible Employee subject to identical restrictions
shall be forfeited by the Eligible Employee and reacquired
by the Company.
(d) Each grant of Restricted Stock shall be evidenced
by an agreement executed on behalf of the Company by any
officer and delivered to and accepted by the Eligible
Employee and shall contain such terms and provisions,
consistent with this Plan, as the Board of Directors may
approve.
16. Directors Stock Option Plan.
(a) Purpose. The purpose of this stock option plan
for non-employee directors of the Company is to attract and
retain directors and encourage directors to become
significant holders of the Company's Common Stock and
thereby identify more closely with the stockholders'
interests.
(b) Definitions. As used in this Paragraph 16,
(i) All of the terms defined in Paragraph 2 of
the Plan shall have the same meanings for purposes of
this Paragraph 16 except that the term "Option Right"
shall mean, in addition to the meaning set forth in
Paragraph 2(1), the right to purchase a share of Common
Stock upon exercise of an option granted pursuant to
Paragraph 16 of the Plan.
(ii) The term "Directors Stock Option Plan" means
the plan set forth in this Paragraph 16.
(iii) The term "Eligible Director" means a non-
employee director of the Company in office on the date
of adoption of the Directors Stock Option Plan by the
Board of Directors and after such date any director
elected for the first time to the Board of Directors
provided that such director is at the time of such
election not a full-time employee of the Company.
(c) Grants. Options to purchase 10,000 shares of
Common Stock (as adjusted pursuant to Paragraph (d) below)
shall be granted to each Eligible Director on the date of
adoption of the Directors Stock Option Plan by the Board of
Directors, subject to the approval of this amendment to the
1988 Long-Term Incentive Plan by the stockholders of the
Company at the 1991 Annual Meeting of Stockholders and any
adjournment thereof, and up to six future Eligible Directors
on the business day on which such Eligible Director is
elected to the Board of Directors. Each such grant shall be
subject to the following terms and conditions:
(i) Each grant shall specify an option price per
share equal to the Market Value per Share on the date
of grant.
(ii) Each grant shall specify that the option
price shall be payable at the time of exercise (A) in
cash or by check acceptable to the Company, (B) by
delivery to the Company of shares of Common Stock that
have been owned by the Optionee not less than six
months equal in value to the option price (such shares
to be valued for this purpose at their Market Price per
Share on the date of exercise) or (C) a combination of
the foregoing, as may be selected by the Optionee at
the time of exercise.
(iii) Each option granted under the Directors
Stock Option Plan shall have a stated expiration date
of not more than ten years from the date of grant and
shall be subject to earlier expiration or termination
as hereinafter provided. If any Optionee subsequently
becomes an employee of the Company while remaining a
member of the Board of Directors, any options held
under the Directors Stock Option Plan by such
individual at the time of commencement of employment
shall not be affected thereby.
(iv) The Option Rights granted under the
Directors Stock Option Plan shall become exercisable
over a period of three years from the date of grant,
with one-third of the Option Rights becoming
exercisable on the first anniversary of the grant, one-
third on the second anniversary and the balance on the
third anniversary.
(v) In the event of termination of service on the
Board by an Optionee, other than by reason of
retirement, disability or death as set forth in
subparagraph (vi) hereof, the then outstanding Option
Rights of such Optionee may be exercised only to the
extent they were exercisable on the date of such
termination and shall expire three months after such
termination or on their stated expiration date,
whichever occurs first, except that in the event the
Optionee's service on the Board is terminated for
cause, such individual's Option Rights shall expire on
the date of such termination.
(vi) In the event of termination of an Optionee's
service by reason of (A) retirement as a director under
the Board of Directors' retirement policy or the total
and permanent disability of the Optionee, each of the
Option Rights of such Optionee shall immediately become
exercisable in full and expire three years after the
date of retirement or disability, but in no event after
the stated expiration date, except that if a retired or
disabled Optionee dies within such three year period,
the expiration date shall be reduced from that
otherwise applicable to one year from the date of death
or (B) the death of an Optionee, each of the Option
Rights of such Optionee shall immediately become
exercisable in full and expire one year after the date
of death, but in no event after the stated expiration
date.
(vii) No fractional shares of Common Stock shall
be issued pursuant to the exercise of Option Rights,
but in lieu thereof, the cash value of such fraction
shall be paid.
(viii) Each grant of Option Rights shall be
evidenced by an agreement executed on behalf of the
Company by any officer and delivered to and accepted by
the Eligible Director and shall contain such terms and
conditions, consistent with the Directors Stock Option
Plan, as the committee established in subparagraph (d)
below shall approve.
(d) Certain Adjustments. A committee consisting of
the directors who are not eligible to participate in the
Directors Stock Option Plan (the "DSOP Committee") shall
have the power to make ministerial decisions with respect to
the Directors Stock Option Plan and the Option Rights
granted thereunder including but not limited to the power to
make such adjustments in the option price and the number or
kind of shares or other securities covered by the
outstanding Option Rights as it in its sole discretion may
determine is equitably required to prevent dilution or
enlargement of the rights of Optionees that otherwise would
result from any stock dividend, stock split, combination of
shares, recapitalization or other change in the capital
structure of the Company, merger, consolidation, spin-off,
reorganization, partial or complete liquidation, issuance of
rights or warrants to purchase securities, or any other
corporate transaction or event having an effect similar to
the foregoing. The determination of the DSOP Committee as
to what adjustments shall be made, and the extent thereof,
shall be final, binding and conclusive. The DSOP Committee
shall have no authority or discretion with respect to the
eligibility or selection of directors to receive Option
Rights under the Directors Stock Option Plan, the times at
which Option Rights shall be granted or become exercisable,
the aggregate number of shares subject to the Directors
Stock Option Plan and the number of shares subject to any
grants of Option Rights, or the purchase price thereunder
except as specifically provided above.
(e) Non-Statutory Options. All Option Rights granted
under the Directors Stock Option Plan shall be non-statutory
options not intended to qualify under Section 422A of the
Internal Revenue Code of 1986, as amended (the "Code").
Each Option Right granted under the Directors Stock Option
Plan shall provide that such Option Right shall not be
treated as an "incentive stock option" as that term is
defined in Section 422A(b) of the Code.
(f) Miscellaneous. Except as otherwise provided in
this Paragraph 16 and except for the Dividend Credits
established by Paragraph 7 of the Plan, all of the terms and
provisions of the Plan shall apply to the shares available
and Option Rights granted under the Directors Stock Option
Plan, the Optionees under the Directors Stock Option Plan
and the operation and administration of the Directors Stock
Option Plan, provided, however, that in no event shall
provisions of the Directors Stock Option Plan be amended
more than once every six months.
