<PAGE>
As filed with the Commission on May 5, 1998
Registration No. 333-________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
------------------------
HELLER FINANCIAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 36-1208070
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
500 West Monroe Street
Chicago, Illinois 60661
---------------------- -----
(Address of principal executive offices) (zip code)
Heller Financial, Inc. 1998 Stock Incentive Plan
(Full title of the Plan)
- --------------------------------------------------------------------------------
Debra H. Snider, Esq.
Executive Vice President, Chief Administrative Officer
General Counsel and Secretary
Heller Financial, Inc.
500 West Monroe Street
Chicago, Illinois, 60661
------------------------
(Name and address of agent for service)
(312) 441-7000
------------------------
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate offering Amount of
to be registered (1) registered (1) per share (2) price (2) registration fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Common Stock, $.25 par value 6,718,125 shares $30.59375 $205,532,636.70 $60,632.13
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 416(a), this Registration Statement shall be deemed to
cover any additional shares of Class A Common Stock, par value $.25 per
share, which may be offered pursuant to the Heller Financial, Inc. 1998
Stock Incentive Plan.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(h) on the basis of the average high and low prices reported for
shares of Common Stock on the New York Stock Exchange Composite Tape on May
1, 1998, which was $30.59375.
<PAGE>
PART I
INFORMATION REQUIRED IN SECTION 10(a) PROSPECTUS
The document(s) containing the information specified in Part I of Form S-8
will be sent or given to participating employees as specified by Rule 428(b)(1)
of the Securities Act of 1933, as amended (the "Securities Act"). These
documents and the documents incorporated by reference into this Registration
Statement pursuant to Item 3 of Part II of this Registration Statement, taken
together, constitute a prospectus that meets the requirements of Section 10(a)
of the Securities Act.
PART II
INFORMATION REQUIRED IN THIS REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
Heller Financial, Inc. (the "Company") hereby incorporates the following
documents herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended December
31, 1997; and
(b) The Company's Annual Report on Form 10-K/A for the year ended December
31, 1997; and
(c) The Company's Current Reports on Form 8-K filed with the Commission on
January 6, 1998, January 29, 1998, January 31, 1998, February 20, 1998, February
28, 1998 and April 21, 1998; and
(d) The description of the Company's Class A Common Stock, $.25 par value
per share, contained in the "Description of Capital Stock" section of the
Company's registration statement on Form S-2, file no. 333-46915, filed with the
Securities and Exchange Commission (the "SEC") on February 26, 1998, including
any subsequent amendments thereto or any report or other filing with the SEC
updating such description.
In addition, all documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this
Registration Statement and prior to the filing of a post-effective amendment to
this Registration Statement which indicates that all securities offered hereby
have been sold or which deregisters all such securities then remaining unsold
shall be deemed to be incorporated herein by reference and to be a part hereof
from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any subsequently filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
Item 4. Description of Securities
Not Applicable.
<PAGE>
Item 5. Interests of Named Experts and Counsel
Certain matters with respect to the Common Stock of the Company being
registered hereunder are being passed upon by Mark Ohringer, Esq., whose opinion
is filed as Exhibit 5.1 to this Registration Statement. Mr. Mark Ohringer is
Associate General Counsel and Assistant Secretary of the Company and is eligible
to participate in the plan registered hereunder.
Item 6. Indemnification of Directors and Officers
The Company is a Delaware corporation. Reference is made to Section 145 of
the Delaware General Corporation Law, as amended (the "GCL"), which 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 or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of such corporation), by reason of the fact that
such person is or was a director, officer, employee or agent of the corporation,
or is or was serving at its request in such capacity of another corporation or
business organization against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by such
person in connection with such action, suit or proceeding if such person acted
in good faith and in a manner such person reasonably believed to be in or not
opposed to the best interest of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe that such
person's conduct was unlawful. A Delaware corporation may indemnify officers
and directors in any action by or in the right of a corporation under the same
conditions, except that no indemnification is permitted without judicial
approval if the officer or director is adjudged to be liable to the corporation.
Where an officer or director is successful on the merits or otherwise in the
defense of any action referred to above, the corporation must indemnify him
against the expenses (including attorneys' fees) that such officer or director
actually and reasonably incurred.
Reference is also made to Section 102(b)(7) of the GCL, which permits a
corporation to provide in its certificate of incorporation that a director of
the corporation shall not be personally liable to the corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the GCL or (iv) for any transaction from which the director
derived an improper personal benefit.
The Amended and Restated Certificate of Incorporation of the Company
provides for the elimination of personal liability of a director for breach of
fiduciary duty as permitted by Section 102(b)(7) of the GCL and the Amended and
Restated By-Laws of the Company provide that the Company shall indemnify its
directors and officers to the full extent permitted by Section 145 of the GCL.
The Company intends to maintain directors and officers liability insurance
that insures the directors and officers of the Company against certain
liabilities.
Item 7. Exemption From Registration Claimed
Not Applicable.
Item 8. Exhibits
A list of exhibits is set forth on the Index to Exhibits.
<PAGE>
Item 9. Undertakings
(a) The undersigned Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made of the securities registered hereby, 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 this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this section
do not apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with
or furnished to the SEC by the Company pursuant to Section 13 or Section
15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Company hereby further undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the Company's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of the annual report of the employee benefit
plans pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the SEC 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 Company of expenses incurred or paid by a director, officer
or controlling person of the Company 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 Company 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.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Company 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 Chicago, Illinois on the 1st day of May, 1998.
HELLER FINANCIAL, INC.
By: /s/ Richard J. Almeida
_______________________________________
Richard J. Almeida
Chairman of the Board and
Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Lauralee E. Martin, Debra H. Snider and Mark J.
Ohringer and each of them (with full power to each of them to act alone), his
true and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto
and other documents in connection therewith, with the SEC, granting unto said
attorneys-in-fact and agents, 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, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all said attorneys-in-fact
and agents, or any of them, or their substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
Signature Title Date
_________ _____ ____
/s/ Richard J. Almeida
______________________ Chairman of the Board and May 1, 1998
Richard J. Almeida Chief Executive Officer
(Principal Executive Officer)
/s/ Lauralee E. Martin
______________________ Executive Vice President, May 1, 1998
Lauralee E. Martin Chief Financial Officer and
Director (Principal Financial
Officer)
/s/ Lawrence G. Hund
______________________ Executive Vice President and May 1, 1998
Lawrence G. Hund Controller (Principal
Accounting Officer)
/s/ Michael J. Litwin
______________________ Executive Vice President, May 1, 1998
Michael J. Litwin Chief Credit Officer and
Director
/s/ Kenichiro Tanaka
______________________ Executive Vice President and May 1, 1998
Kenichiro Tanaka Director
/s/ Masahiro Sawada
______________________ Senior Vice President and May 1, 1998
Masahiro Sawada Director
/s/ Dennis P. Lockhart
______________________ Director May 1, 1998
Dennis P. Lockhart
<PAGE>
/s/ Atsushi Takano
______________________ Director May 1, 1998
Atsushi Takano
/s/ Yukihiko Chayama
______________________ Director May 1, 1998
Yukihiko Chayama
/s/ Kenichi Tomita
______________________ Director May 1, 1998
Kenichi Tomita
/s/ Takeshi Takahashi
______________________ Director May 1, 1998
Takeshi Takahashi
/s/ Tsutomu Hayano
______________________ Director May 1, 1998
Tsutomu Hayano
/s/ Osamu Ogura
______________________ Director May 1, 1998
Osamu Ogura
/s/ Mark Kessel
______________________ Director May 1, 1998
Mark Kessel
/s/ Hideo Nakajima
______________________ Director May 1, 1998
Hideo Nakajima
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
Number Description
- ------ -----------
4.1 Heller Financial, Inc. 1998 Stock Incentive Plan
4.2 Form of Restricted Stock Award and Form of Special Restricted Award
Under Heller Financial, Inc. 1998 Stock Incentive Plan
4.3 Form of Nonqualified Stock Option Award Agreement Under Heller
Financial, Inc. 1998 Stock Incentive Plan
4.4 Amended and Restated Certificate of Incorporation of the Company
(incorporated herein by reference to Exhibit 3.1 of the Company's
registration statement number 333-46915, as amended)
4.5 Amended and Restated By-Laws of the Company (incorporated herein by
reference to Exhibit 3.2 of the Company's registration statement
number 333-46915, as amended)
4.6 The description of the Company's Class A Common Stock, $.25 par value
per share (incorporated herein by reference to the "Description of
Capital Stock" section of the Company's registration statement on Form
S-2, file no. 333-46915, as amended)
4.7 Specimen stock certificate representing Class A Common Stock
(incorporated herein by reference to Exhibit 4 of the Company's
registration statement number 333-46915, as amended)
5.1 Opinion re: legality of the securities being registered
23.1 Consent of Arthur Andersen LLP
23.2 Consent of legal counsel (included as part of their opinion filed as
Exhibit 5.1)
24.1 Powers of Attorney (included on the signature page hereof)
<PAGE>
EXHIBIT 4.1
HELLER FINANCIAL, INC.
1998 STOCK INCENTIVE PLAN
<PAGE>
HELLER FINANCIAL, INC.
1998 STOCK INCENTIVE PLAN
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Article 1. Establishment, Objectives and Duration....................... 1
Article 2. Definitions.................................................. 2
Article 3. Administration............................................... 6
Article 4. Shares Subject to the Plan and Maximum Awards................ 7
Article 5. Eligibility and Participation................................ 8
Article 6. Stock Options................................................ 9
Article 7. Stock Appreciation Rights....................................11
Article 8. Restricted Stock.............................................12
Article 9. Performance Units and Performance Shares.....................14
Article 10. Performance Measures.........................................16
Article 11. Beneficiary Designation......................................17
Article 12. Deferrals....................................................17
Article 13. Rights of Employees..........................................18
Article 14. Initial Public Offering Protections..........................18
Article 15. Amendment, Modification and Termination......................19
Article 16. Withholding..................................................19
Article 17. Successors...................................................20
Article 18. Legal Construction...........................................20
</TABLE>
i
<PAGE>
HELLER FINANCIAL, INC.
1998 STOCK INCENTIVE PLAN
Article 1. Establishment, Objectives and Duration
1.1 Establishment of the Plan. Heller Financial, Inc., a Delaware
corporation, hereby establishes a long-term incentive compensation plan to be
known as the "Heller Financial, Inc. 1998 Stock Incentive Plan," as set forth in
this document. Capitalized terms used but not otherwise defined herein will have
the meanings given to them in Article 2. The Plan permits the grant of
Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights,
Restricted Stock, Performance Shares and Performance Units. In addition, the
Plan provides the opportunity for the deferral of the payment of salary, bonuses
and other forms of incentive compensation.
Subject to the approval of the Company's stockholders, the Plan will become
effective as of April 1, 1998 and will remain in effect as provided in Section
1.3 hereof.
1.2 Objectives of the Plan. The objectives of the Plan are to optimize the
profitability and growth of the Company through long-term incentives which are
consistent with the Company's objectives and which link the interests of
Participants to those of the Company's stockholders; to provide Participants
with an incentive for excellence in individual performance; to promote teamwork
among Participants; and to give the Company a significant advantage in
attracting and retaining officers, key employees and directors.
The Plan is further intended to provide flexibility to the Company in its
ability to motivate, attract and retain the services of Participants who make
significant contributions to the Company's success and to allow Participants to
share in the success of the Company.
1.3 Duration of the Plan. The Plan will commence on the Effective Date, as
described in Section 1.1, and will remain in effect, subject to the right of the
Board of Directors to amend or terminate the Plan at any time pursuant to
Article 15, until all Shares subject to it pursuant to Article 4 have been
issued or transferred according to the Plan's provisions. In no event may an
Award be granted under the Plan on or after March 31, 2008.
<PAGE>
Article 2. Definitions
Whenever used in the Plan, the following terms have the meanings set forth
below, and when the meaning is intended, the initial letter of the word will be
capitalized:
"Award" means, individually or collectively, a grant under this Plan to a
Participant of Nonqualified Stock Options, Incentive Stock Options, Stock
Appreciation Rights, Restricted Stock, Performance Shares or Performance Units.
"Award Agreement" means an agreement entered into by the Company and a
Participant setting forth the terms and provisions applicable to an Award or
Awards granted to the Participant or the terms and provisions applicable to an
election to defer compensation under Section 8.2.
"Beneficial Owner" or "Beneficial Ownership" has the meaning ascribed to
that term in Rule 13d-3 of the General Rules and Regulations under the Exchange
Act.
"Board" or "Board of Directors" means the Board of Directors of the
Company.
"Cause" means:
(a) an employee's fraud or criminal misconduct; or
(b) the material and willful breach by an employee of his or her
responsibilities or willful failure to comply with reasonable
directives or policies of the Company's Board of Directors; but only
if the Company has given the employee written notice specifying the
breach or failure to comply, demanding that the employee remedy the
breach or failure to comply and giving the employee an opportunity to
be heard in connection with the breach or failure to comply, and the
employee either failed to remedy the alleged breach or failed to
comply within thirty days after receipt of the written notice or
failed to take all reasonable steps to that end during the thirty days
after he or she received the notice.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Committee" means, as specified in Article 3, the Compensation Committee of
the Board or such other committee as may be appointed by the Board to administer
the Plan.
2
<PAGE>
"Company" means Heller Financial, Inc., a Delaware corporation, and any
successor thereto as provided in Article 17.
"Director" means any individual who is a member of the Board of Directors.
"Disability" means (i) long-term disability as defined under the long-term
disability plan of the Company or a Subsidiary that covers that individual, or
(ii) if the individual is not covered by such a long-term disability plan,
disability as defined for purposes of eligibility for a disability award under
the Social Security Act.
"Effective Date" means April 1, 1998.
"Eligible Employee" means any employee of the Company or any of its
Subsidiaries. Directors who are not employed by the Company or its Subsidiaries
will be considered Eligible Employees under this Plan, but only for purposes of
Awards of Nonqualified Stock Options.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
time to time, or any successor act thereto.
"Exercise Price" means the price at which a Share may be purchased by a
Participant pursuant to an Option.
"Fair Market Value" means:
(a) the average of the high and low trading prices of the Shares on the
New York Stock Exchange (or, if the Shares are not traded on the New
York Stock Exchange, on any other exchange on which they are traded);
if the Shares are not traded on any exchange, the fair market value of
the Shares as determined by the Board or, at the discretion of the
Board, by an independent appraiser selected by the Board; but
(b) notwithstanding the foregoing, for Options granted in connection with,
and as of the date of, the initial public offering of the Shares, the
initial public offering price of the Shares.
"Freestanding SAR" means an SAR that is granted independently of any
Options, as described in Article 7.
3
<PAGE>
"Good Reason" exists if, without an Eligible Employee's express written
consent, any of the following events occur within three years after the
Company's initial public offering of the Shares:
(a) the Company or a Subsidiary significantly diminishes the Eligible
Employee's assigned duties and responsibilities from the level or
extent at which they existed before the effective date of the initial
public offering including, without limitation, if the Company or
Subsidiary removes the Eligible Employee's title(s) or materially
diminishes the powers associated with the Eligible Employee's
title(s). For Good Reason to exist, the Eligible Employee must deliver
written notice to the Company or Subsidiary specifying the diminution
in assigned duties and responsibilities that he or she believes
constitutes Good Reason, and the Company or Subsidiary must fail to
reverse the same or to take all reasonable steps to that end within
thirty days after receiving the notice;
(b) the Company or a Subsidiary reduces the Eligible Employee's base
salary below the greater of that in effect as of the date of the
Eligible Employee's Award Agreement and that in effect as of the
effective date of the initial public offering;
(c) the Company or Subsidiary requires the Eligible Employee to, or
assigns duties to the eligible Employee which would reasonably require
him or her to, relocate his or her principal business office or his or
her principal place of residence outside the Standard Metropolitan
Statistical Area where the Eligible Employee was located on the
effective date of the initial public offering (the "Geographical
Employment Area");
(d) the Company or a Subsidiary requires the Eligible Employee to, or
assigns duties to the Eligible Employee which would reasonably require
him or her to, spend more than one hundred normal working days away
from the Geographical Employment Area during any consecutive twelve-
month period; or
(e) the Company or a Subsidiary fails to continue in effect any cash or
stock-based incentive or bonus plan, retirement plan, welfare benefit
plan, or other benefit plan, program or arrangement that applied to
the Eligible Employee on the effective date of the initial public
offering, unless the aggregate value (as computed by an independent
employee benefits consultant selected by the Company) of all such
compensation, retirement and benefit plans, programs and arrangements
provided to
4
<PAGE>
the Eligible Employee is not materially less than the greater of their
aggregate value as of the date of the Eligible Employee's Award
Agreement, or their aggregate value as of the effective date of the
initial public offering.
"Incentive Stock Option" or "ISO" means an option to purchase Shares
granted under Article 6 that is designated as an Incentive Stock Option and that
is intended to meet the requirements of Code Section 422.
"Nonqualified Stock Option" or "NQSO" means an option to purchase Shares
granted under Article 6 that is not intended to meet the requirements of Code
Section 422.
"Option" means an Incentive Stock Option or a Nonqualified Stock Option, as
described in Article 6.
"Participant" means an Eligible Employee who has been selected by the
Committee to participate in the Plan pursuant to Section 5.2 and who has
outstanding an Award granted under the Plan. The term "Participant" will
include Directors who are not employees of the Company or a Subsidiary only if
they are chosen to receive Awards of Nonqualified Stock Options, and only for
purposes of Nonqualified Stock Options.
"Performance-Based Exception" means the performance-based exception from
the tax deductibility limitations of Code Section 162(m) and any regulations
promulgated thereunder.
"Performance Period" means the time period during which performance
objectives must be met in order for a Participant to earn Performance
Units/Shares granted under Article 9.
"Performance Share" means an Award with an initial value equal to the Fair
Market Value on the date of grant which is based on the Participant's attainment
of performance objectives, as described in Article 9.
"Performance Unit" means an Award with an initial value established by the
Committee at the time of grant which is based on the Participant's attainment of
performance objectives, as described in Article 9.
"Person" has the meaning ascribed to that term in Section 3(a)(9) of the
Exchange Act and used in Sections 13(d) and 14(d) thereof, including a "group"
as defined in Section 13(d) thereof.
5
<PAGE>
"Plan" means the Heller Financial, Inc. 1998 Stock Incentive Plan, as
set forth in this document.
"Restriction Period" means the period during which the transfer of
Shares of Restricted Stock is limited in some way (based on the passage of time,
the achievement of performance objectives, or the occurrence of other events as
determined by the Committee, at its discretion), and/or the Restricted Stock is
not vested.
"Restricted Stock" means a contingent grant of stock awarded to a
Participant pursuant to Article 8.
"Retirement" means termination of employment on or after reaching the
age established by the Company as the normal retirement age in any unexpired
employment agreement between the Participant and the Company and/or a
Subsidiary, or, if different, the normal retirement age under the Heller
Financial, Inc. Retirement Plan.
"Shares" means the shares of Class A Common Stock, $0.25 par value, of
the Company.
"Stock Appreciation Right" or "SAR" means an Award, granted alone or in
connection with a related Option, designated as an SAR pursuant to the terms of
Article 7.
"Subsidiaries" means the Company's Subsidiaries within the meaning of
Code Section 424(f).
"Tandem SAR" means an SAR that is granted in connection with a related
Option pursuant to Article 7, the exercise of which requires forfeiture of the
right to purchase a Share under the related Option (and when a Share is
purchased under the Option, the Tandem SAR will similarly be canceled).
Article 3. Administration
3.1 The Committee. The Plan will be administered by the Compensation
Committee of the Board, or by any other Committee appointed by the Board, which
Committee (unless otherwise determined by the Board) will satisfy the
"nonemployee director" requirements of Rule 16b-3 under the Exchange Act and the
regulations of Rule 16b-3 under the Exchange Act and the "outside director"
provisions of Code Section 162(m), or any successor regulations or provisions.
6
<PAGE>
The members of the Committee will be appointed from time to time by, and serve
at the discretion of, the Board of Directors. The Committee will act by a
majority of its members at the time in office and eligible to vote on any
particular matter, and Committee action may be taken either by a vote at a
meeting or in writing without a meeting.
3.2 Authority of the Committee. Except as limited by law and subject
to the provisions of this Plan, the Committee will have full power to: select
Eligible Employees to participate in the Plan; determine the sizes and types of
Awards; determine the terms and conditions of Awards in a manner consistent with
the Plan; construe and interpret the Plan and any agreement or instrument
entered into under the Plan; establish, amend or waive rules and regulations for
the Plan's administration; and (subject to the provisions of Article 15) amend
the terms and conditions of any outstanding Award to the extent they are within
the discretion of the Committee as provided in the Plan. Further, the Committee
will make all other determinations that may be necessary or advisable to
administer the Plan. As permitted by law and consistent with Section 3.1, the
Committee may delegate some or all of its authority under the Plan.
3.3 Decisions Binding. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan will be final, conclusive and
binding on all persons, including, without limitation, the Company, its Board of
Directors, its stockholders, all Subsidiaries, employees, Participants and their
estates and beneficiaries.
Article 4. Shares Subject to the Plan and Maximum Awards
4.1 Number of Shares Available for Grants. Subject to adjustment as
provided in Section 4.3, the number of Shares that may be issued or transferred
to Participants under the Plan is 7.5% of the Shares outstanding upon
consummation of the Company's initial public offering (6,341,250 Shares, plus up
to 376,875 additional Shares if certain underwriters' overallotment options are
exercised). The maximum numbers of Shares that may be issued or transferred
during any calendar year to the Participants as Performance Units is 500,000.
The maximum number of Shares and Share equivalent units that may be
granted during any calendar year to any one Participant under Options,
Freestanding SARs, Restricted Stock or Performance Shares is 500,000, which
limit will apply regardless of whether the compensation is paid in Shares or in
cash.
7
<PAGE>
4.2 Lapsed Awards. If any Award granted under this Plan is canceled,
terminates, expires or lapses for any reason, any Shares subject to the Award
will again be available for the grant of an Award under the Plan.
4.3 Adjustments in Authorized Shares.
(a) If the Shares, as currently constituted, are changed into or
exchanged for a different number or kind of shares of stock or other
securities of the Company or of another corporation (whether because
of merger, consolidation, recapitalization, reclassification, split,
reverse split, combination of shares, or otherwise) or if the number
of Shares is increased through the payment of a stock dividend, then
the Committee will substitute for or add to each Share previously
appropriated, later subject to, or which may become subject to, an
Award, the number and kind of shares of stock or other securities
into which each outstanding Share was changed for which each such
Share was exchanged, or to which each such Share is entitled, as the
case may be. The Committee will also appropriately amend outstanding
Awards as to price and other terms, to the extent necessary to
reflect the events described above. If there is any other change in
the number or kind of the outstanding Shares, of any stock or other
securities into which the outstanding Shares have been changed, or
for which they have been exchanged, the Committee may, in its sole
discretion, appropriately adjust any Award already granted or which
may be afterward granted.
(b) Fractional Shares resulting from any adjustment in Awards pursuant
to this section may be settled in cash or otherwise as the Committee
determines. The Company will give notice of any adjustment to each
Participant who holds an Award that has been adjusted and the
adjustment (whether or not such notice is given) will be effective
and binding for all Plan purposes.
Article 5. Eligibility and Participation
5.1 Eligibility. All Eligible Employees, including Eligible Employees
who are members of the Board, are eligible to participate in this Plan.
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5.2 Actual Participation. Subject to the provisions of the Plan, the
Committee will, from time to time, select those Eligible Employees to whom
Awards will be granted, and will determine the nature and amount of each Award.
Article 6. Stock Options
6.1 Grant of Options. Subject to the terms and provisions of the Plan,
Options may be granted to Eligible Employees in the number, and upon the terms,
and at any time and from time to time, as determined by the Committee.
6.2 Award Agreement. Each Option grant will be evidenced by an Award
Agreement that specifies the Exercise Price, the duration of the Option, the
number of Shares to which the Option pertains, the manner, time and rate of
exercise or vesting of the Option, and such other provisions as the Committee
determines. The Award Agreement will also specify whether the Option is intended
to be an ISO or an NQSO, and whether reload options will be granted.
6.3 Exercise Price. The Exercise Price for each share subject to an
Option will be at least one hundred percent of the Fair Market Value on the date
the Option is granted.
6.4 Duration of Options. Each Option will expire at the time determined
by the Committee at the time of grant, but no later than the tenth anniversary
of the date of its grant.
6.5 Dividend Equivalents. The Committee may, but shall not be required
to, grant payments in connection with Options that are equivalent to dividends
declared and paid on the Shares underlying the Options. Such dividend equivalent
payments may be made in cash or in Shares, upon such terms as the Committee, in
its sole discretion, deems appropriate.
6.6 Exercise of Options. Options will be exercisable at such times and
be subject to such restrictions and conditions as the Committee in each instance
approves, which need not be the same for each Award or for each Participant.
6.7 Payment. The holder of an Option may exercise the Option only by
delivering a written notice of exercise to the Company setting forth the number
of Shares as to which the Option is to be exercised, together with full payment
at the Exercise Price for the Shares and any withholding tax relating to the
exercise of the Option.
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The Exercise Price and any related withholding taxes will be payable to
the Company in full either: (a) in cash, or its equivalent, in United States
dollars; (b) if permitted in the governing Award Agreement, by tendering Shares
owned by the Participant and duly endorsed for transfer to the Company, Shares
issuable to the Participant upon exercise of the Option, or any combination of
cash, certified or cashier's check and Shares described in this clause (b); or
(c) by any other means the Committee determines to be consistent with the Plan's
purposes and applicable law. Cashless exercise must meet the requirements of the
Federal Reserve Board's Regulation T and any applicable securities law
restrictions.
The Committee may provide for reload options in the Award Agreement
evidencing an Option. If such reload options are provided for, they shall be
granted automatically in accordance with the applicable provisions in the Award
Agreement.
6.8 Restrictions on Share Transferability. The Committee may impose
such restrictions on any Shares acquired through exercise of an Option as it
deems necessary or advisable, including, without limitation, restrictions under
applicable federal securities laws, under the requirements of any stock exchange
or market upon which the Shares are then listed and/or traded, and under any
blue sky or state securities laws applicable to the Shares.
6.9 Termination of Employment. Each Option Award Agreement will set
forth the extent to which the Participant has the right to exercise the Option
after his or her termination of employment with the Company and all
Subsidiaries. These terms will be determined by the Committee in its sole
discretion, need not be uniform among all Options, and may reflect, among other
things, distinctions based on the reasons for termination of employment.
6.10 Nontransferability of Options. Except as otherwise provided in a
Participant's Award Agreement, no Option granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, all Options will be
exercisable during the Participant's lifetime only by the Participant or his or
her guardian or legal representative. The Committee may, in its discretion,
require a Participant's guardian or legal representative to supply it with the
evidence the Committee deems necessary to establish the authority of the
guardian or legal representative to act on behalf of the Participant.
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Article 7. Stock Appreciation Rights
7.1 Grant of SARs. Subject to the terms and conditions of the Plan, SARs
may be granted to Participants at any time and from time to time, as determined
by the Committee. The Committee may grant Freestanding SARs, Tandem SARs or any
combination of the two.
Within the limits of Article 4, the Committee will have sole discretion to
determine the number of SARs granted to each Participant and, consistent with
the provisions of the Plan, to determine the terms and conditions pertaining to
SARs.
The grant price of a Freestanding SAR will equal the Fair Market Value on
the date of grant of the SAR. The grant price of a Tandem SAR will equal the per
Share Exercise Price of the Option to which it relates.
7.2 Exercise of Tandem SARs. Tandem SARs may be exercised for all or part
of the Shares subject to the related Option, upon the surrender of the right to
exercise the equivalent portion of the related Option. A Tandem SAR may be
exercised only with respect to the Shares for which its related Option is then
exercisable.
7.3 Exercise of Freestanding SARs. Freestanding SARs may be exercised
upon whatever terms and conditions the Committee, in its sole discretion,
imposes.
7.4 Award Agreement. Each SAR grant will be evidenced by an Award
Agreement that specifies the grant price, the term of the SAR and such other
provisions as the Committee determines.
7.5 Term of SARS. The term of an SAR will be determined by the Committee,
in its sole discretion, but may not exceed ten years.
7.6 Payment of SAR Amount. Upon exercise of an SAR, a Participant will be
entitled to receive payment from the Company in an amount determined by
multiplying:
(a) the excess (or some portion of the excess as determined at the
time of the grant by the Committee) if any, of the Fair Market
Value on the date of exercise of the SAR over the grant price
specified in the Award Agreement; by
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<PAGE>
(b) the number of Shares as to which the SAR is exercised.
At the discretion of the Participant, the payment upon SAR exercise may be
made in cash, in Shares of equivalent Fair Market Value or in some combination
of the two.
7.7 Termination of Employment. Each SAR Award Agreement will set forth
the extent to which the Participant has the right to exercise the SAR after his
or her termination of employment with the Company and all Subsidiaries. These
terms will be determined by the Committee in its sole discretion, need not be
uniform among all SARs issued under the Plan, and may reflect, among other
things, distinctions based on the reasons for termination of employment.
7.8 Nontransferability of SARs. Except as otherwise provided in a
Participant's Award Agreement, no SAR may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Further, except as otherwise provided in a
Participant's Award Agreement, all SARs will be exercisable during the
Participant's lifetime only by the Participant or the Participant's guardian or
legal representative. The Committee may, in its discretion, require a
Participant's guardian or legal representative to supply it with evidence the
Committee deems necessary to establish the authority of the guardian or legal
representative to act on behalf of the Participant.
Article 8. Restricted Stock
8.1 Grant of Restricted Stock. Subject to the terms and provisions of the
Plan, the Committee may, at any time and from time to time, grant Restricted
Stock to Participants in such amounts as it determines.
8.2 Deferral of Compensation into Restricted Stock. Subject to the terms
and provisions of the Plan, the Committee may, at any time and from time to
time, allow (or require, as to bonuses) selected Eligible Employees to defer the
payment of any portion of their salary and/or annual bonuses pursuant to this
section. A Participant's deferral under this section will be credited to the
Participant in the form of Shares of Restricted Stock. The Committee will
establish rules and procedures for the deferrals, as it deems appropriate.
In consideration for forgoing compensation, the dollar amount deferred by a
Participant may be increased by twenty-five percent (or such lesser percentage
as the Committee may determine) for purposes of determining the number of Shares
of Restricted Stock to grant the Participant. If a
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<PAGE>
Participant's compensation is deferred under this Section 8.2, he or she will be
credited, as of the date specified in the Award Agreement, with a number of
shares of Restricted Stock equal to the amount of the deferral (increased as
described above) divided by the Fair Market Value on that date.
8.3 Award Agreement. Each Restricted Stock grant will be evidenced by an
Award Agreement that specifies the Restriction Periods, the number of Shares
granted, and such other provisions as the Committee determines.
8.4 Nontransferability. The Restricted Stock granted herein may not be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distributions, until the end of
the applicable Restriction Period as specified in the Award Agreement, or upon
earlier satisfaction of any other conditions specified by the Committee in its
sole discretion and set forth in the Award Agreement. All rights with respect to
Restricted Stock will be available during the Participant's lifetime only to the
Participant or the Participant's guardian or legal representative. The Committee
may, in its discretion, require a Participant's guardian or legal representative
to supply it with evidence the Committee deems necessary to establish the
authority of the guardian or legal representative to act on behalf of the
Participant.
8.5 Other Restrictions. Subject to Article 11, the Committee may impose
such other conditions and/or restrictions on any Restricted Stock as it deems
advisable including, without limitation, restrictions based upon the achievement
of specific performance objectives (Company-wide, business unit, and/or
individual), time-based restrictions on vesting following the attainment of the
performance objectives, and/or restrictions under applicable federal or state
securities laws. The Committee may provide that restrictions established under
this Section 8.5 as to any given Award will lapse all at once or in
installments.
The Company will retain the certificates representing Shares of Restricted
Stock in its possession until all conditions and/or restrictions applicable to
the Shares have been satisfied.
8.6 Payment of Awards. Except as otherwise provided in this Article 8,
Shares covered by each Restricted Stock grant will become freely transferable by
the Participant after the last day of the applicable Restriction Period.
8.7 Voting Rights. During the Restriction Period, Participants holding
Shares of Restricted Stock may exercise full voting rights with respect to those
Shares.
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8.8 Dividends and Other Distributions. During the Restriction Period,
Participants awarded Shares of Restricted Stock hereunder will be credited with
regular cash dividends paid on those Shares. Dividends may be paid currently,
accrued as contingent cash obligations, or converted into additional Shares of
Restricted Stock, upon such terms as the Committee establishes.
The Committee may apply any restrictions it deems advisable to the
crediting and payment of dividends and other distributions. Without limiting the
generality of the preceding sentence, if the grant or vesting of Restricted
Stock is designed to qualify for the Performance-Based Exception, the Committee
may apply any restrictions it deems appropriate to the payment of dividends
declared with respect to the Restricted Stock, so that the dividends and/or the
Restricted Stock continue to be eligible for the Performance-Based Exception.
8.9 Termination of Employment. Each Award Agreement will set forth the
extent to which the Participant has the right to retain unvested Restricted
Stock after his or her termination of employment with the Company or a
Subsidiary. These terms will be determined by the Committee in its sole
discretion, need not be uniform among all Awards of Restricted Stock, and may
reflect, among other things, distinctions based on the reasons for termination
of employment.
Article 9. Performance Units and Performance Shares
9.1 Grant of Performance Units/Shares. Subject to the terms of the Plan,
Performance Units and/or Performance Shares may be granted to Participants in
such amounts and upon such terms, and at any time and from time to time, as the
Committee determines.
9.2 Value of Performance Units/Shares. Each Performance Unit will have an
initial value established by the Committee at the time of grant. Each
Performance Share will have an initial value equal to the Fair Market Value on
the date of grant. The Committee will set performance objectives in its
discretion which, depending on the extent to which they are met, will determine
the number and/or value of Performance Units/Shares that will be paid out to the
Participant. For purposes of this Article 9, the time period during which the
performance objectives must be met will be called a "Performance Period" and
will be set by the Committee in its discretion.
9.3 Earning of Performance Units/Shares. Subject to the terms of this
Plan, after the applicable Performance Period has ended, the holder of
Performance Units/Shares will be entitled to receive payout on the number and
value of Performance Units/Shares earned by the Participant
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<PAGE>
over the Performance Period, to be determined as a function of the extent to
which the corresponding performance objectives have been achieved.
9.4 Award Agreement. Each grant of Performance Units and/or Performance
Shares will be evidenced by an Award Agreement specifying the material terms and
conditions of the Award (including the form of payment of earned Performance
Units/Shares), and such other provisions as the Committee determines.
9.5 Form and Timing of Payment of Performance Units/Shares. Except as
provided in Article 12, payment of earned Performance Units/Shares will be made
as soon as practicable after the close of the applicable Performance Period, in
a manner determined by the Committee in its sole discretion. The Committee will
pay earned Performance Units/Shares in the form of cash, in Shares, or in a
combination of cash and Shares, as specified in the Award Agreement. Performance
Shares may be paid subject to any restrictions deemed appropriate by the
Committee.
9.6 Termination of Employment Due to Death or Disability. Unless
determined otherwise by the Committee and set forth in the Participant's Award
Agreement, if a Participant's employment is terminated by reason of death or
Disability during a Performance Period, the Participant will receive a prorated
payout of the Performance Units/Shares, as specified by the Committee in its
discretion in the Award Agreement. Payment of earned Performance Units/Shares
will be made at a time specified by the Committee in its sole discretion and set
forth in the Participant's Award Agreement.
9.7 Termination of Employment for Other Reasons. If a Participant's
employment terminates during a Performance Period for any reason other than
death or Disability, the Participant will forfeit all Performance Units/Shares
to the Company, unless the Participant's Award Agreement provides otherwise.
9.8 Nontransferability. Except as otherwise provided in a Participant's
Award Agreement, Performance Units/Shares may not be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Further, except as otherwise provided in a
Participant's Award Agreement, a Participant's rights under the Plan will be
exercisable during the Participant's lifetime only by the Participant or
Participant's guardian or legal representative. The Committee may, in its
discretion, require a Participant's guardian or legal representative to supply
it with evidence the Committee deems necessary to establish the authority of the
guardian or legal representative to act on behalf of the Participant.
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Article 10. Performance Measures
Unless and until the Committee proposes and the Company's stockholders
approve a change in the general performance measures set forth in this Article
10, the performance measure(s) to be used for purposes of Awards designed to
qualify for the Performance-Based Exception will be chosen from among the
following alternatives:
(a) net earnings;
(b) operating earnings or income;
(c) earnings growth;
(d) net income (absolute or competitive growth rates comparative);
(e) net income applicable to Common Stock;
(f) cash flow, including operating cash flow, free cash flow, discounted
cash flow return on investment, and cash flow in excess of cost of
capital;
(g) earnings per Common share;
(h) return on stockholders equity (absolute or peer-group comparative);
(i) stock price (absolute or peer-group comparative);
(j) absolute and/or relative return on common stockholders equity;
(k) absolute and/or relative return on capital;
(l) absolute and/or relative return on assets;
(m) economic value added (income in excess of cost of capital);
(n) customer satisfaction;
(o) expense reduction; and
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(p) ratio of operating expenses to operating revenues.
The Committee will have the discretion to adjust targets set for
preestablished performance objectives; however, Awards designed to qualify for
the Performance-Based Exception may not be adjusted upward, except to the extent
permitted under Code Section 162(m), to reflect accounting changes or other
events.
If Code Section 162(m) or other applicable tax and/or securities laws
change to allow the Committee discretion to change the types performance
measures without obtaining shareholder approval, the Committee will have sole
discretion to make such changes without obtaining stockholder approval. In
addition, if the Committee determines it is advisable to grant Awards that will
not qualify for the Performance-Based Exception, the Committee may grant Awards
that do not so qualify.
Article 11. Beneficiary Designation
Each Participant may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case the Participant should die before
receiving any or all of his or her Plan benefits. Each beneficiary designation
will revoke all prior designations by the same Participant, must be in a form
prescribed by the Committee, and must be made during the Participant's lifetime.
If the Participant's designated beneficiary predeceases the Participant or no
beneficiary has been designated, benefits remaining unpaid at the Participant's
death will be paid to the Participant's estate or other entity described in the
Participant's Award Agreement.
Article 12. Deferrals
The Committee may permit or require a Participant to defer receipt of cash
or Shares that would otherwise be due to him or her by virtue of an Option or
SAR exercise, the lapse or waiver of restrictions on Restricted Stock, or the
satisfaction of any requirements or objectives with respect to Performance
Units/Shares. If any such deferral election is permitted or required, the
Committee will, in its sole discretion, establish rules and procedures for such
deferrals. Notwithstanding the foregoing, the Committee in its sole discretion
may defer payment of cash or the delivery of Shares that would otherwise be due
to a Participant under the Plan if payment or delivery would result in the
Company's or a Subsidiary's being unable to deduct compensation under Code
Section 162(m).
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Deferral of payment or delivery by the Committee may continue until the Company
or Subsidiary is able to deduct the payment or delivery under the Code.
Article 13. Rights of Employees
13.1 Employment. Nothing in the Plan will interfere with or limit in any
way the right of the Company or any affiliate of the Company (as defined in
federal securities laws) to terminate any Participant's employment at any time,
or confer upon any Participant any right to continue in the employ of the
Company or any Subsidiary.
13.2 Participation. No Eligible Employee will have the right to receive
an Award under this Plan, or, having received any Award, to receive a future
Award.
Article 14. Initial Public Offering Protections. If, within three years after
the Company's initial public offering of the Shares, a Participant's employment
with the Company and all Subsidiaries is terminated for a reason other than
Cause, or the Participant terminates his or her employment with the Company and
all Subsidiaries for Good Reason, unless otherwise specifically prohibited under
applicable law or by applicable rules and regulations of any governmental
agencies or national securities exchanges, upon such termination:
(a) any and all outstanding Options and SARs will become immediately
exercisable, and will remain exercisable throughout their entire term;
(b) any Restriction Periods or restrictions imposed on Restricted Stock
will lapse, but the degree of vesting in Restricted Stock that has
been conditioned upon the achievement of performance conditions under
Section 8.5 will be determined in the manner set forth in Section
14.1(c); and
(c) except as otherwise provided in the Award Agreement, all Performance
Units and Performance Shares will fully vest, and within thirty days
following the Participant's termination of employment, he or she will
be paid in cash a pro rata amount based upon assumed achievement of
all relevant performance objectives at target levels, and upon the
fraction of the total Performance Period completed before the
effective date of the termination in employment.
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Article 15. Amendment, Modification and Termination
15.1 Amendment, Modification and Termination. Subject to Section 14.2,
the Board may at any time and from time to time, alter, amend, modify or
terminate the Plan in whole or in part. Subject to the terms and conditions of
the Plan, the Committee may modify, extend or renew outstanding Awards under the
Plan, or accept the surrender of outstanding Awards (to the extent not already
exercised) and grant new Awards in substitution of them (to the extent not
already exercised). The Committee will not, however, modify any outstanding
Incentive Stock Option so as to specify a lower Exercise Price. Notwithstanding
the foregoing, no modification of an Award will, without the prior written
consent of the Participant, alter or impair any rights or obligations under any
Award already granted under the Plan.
15.2 Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. In recognition of unusual or nonrecurring events
(including, without limitation, the events described in Section 4.3) affecting
the Company or its financial statements, or in recognition of changes in
applicable laws, regulations, or accounting principles, and, whenever the
Committee determines that adjustments are appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, the Committee may, using reasonable care, make
adjustments in the terms and conditions of, and the criteria included in,
Awards. In case of an Award designed to qualify for the Performance-Based
Exception, the Committee will take care not to make an adjustment that would
disqualify the Award.
15.3 Compliance with Code Section 162(m). Awards will comply with the
requirements of Code Section 162(m), unless the Committee determines that such
compliance is not desired with respect to an Award available for grant under the
Plan. In addition, if changes are made to Code Section 162(m) to permit greater
flexibility as to any Award available under the Plan, the Committee may, subject
to this Article 15, make any adjustments it deems appropriate.
Article 16. Withholding
16.1 Tax Withholding. The Company will have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
(either in cash or Shares) sufficient to satisfy federal, state, and local
taxes, domestic or foreign, required by law or regulation to be withheld with
respect to any taxable event arising under this Plan. Each Award Agreement will
specify whether reload options will be granted in connection with payment of tax
withholding by tendering Shares owned by the Participant.
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16.2 Share Withholding. With respect to withholding required upon the
exercise of Options or SARs, upon the lapse of restrictions on Restricted Stock,
or upon any other taxable event arising as a result of Awards granted hereunder,
the Company may satisfy the minimum withholding requirement for supplemental
wages, in whole or in part, by withholding Shares having a Fair Market Value
(determined on the date the Participant recognizes taxable income on the Award)
equal to the withholding tax required to be collected on the transaction. The
Participant may elect, subject to the approval of the Committee, to deliver the
necessary funds to satisfy the withholding obligation to the Company, in which
case there will be no reduction in the Shares otherwise distributable to the
Participant.
Article 17. Successors
All obligations of the Company under the Plan or any Award Agreement will
be binding on any successor to the Company, whether the existence of the
successor results from a direct or indirect purchase of all or substantially all
of the business and/or assets of the Company, or a merger, consolidation, or
otherwise.
Article 18. Legal Construction
18.1 Number. Except where otherwise indicated by the context, any plural
term used in this Plan includes the singular and a singular term includes the
plural.
18.2 Severability. If any provision of the Plan is held illegal or
invalid for any reason, the illegality or invalidity will not affect the
remaining parts of the Plan, and the Plan will be construed and enforced as if
the illegal or invalid provision had not been included.
18.3 Requirements of Law. The granting of Awards and the issuance of
Share and/or cash payouts under the Plan will be subject to all applicable laws,
rules, and regulations, and to any approvals by governmental agencies or
national securities exchanges as may be required.
18.4 Securities Law Compliance. As to any individual who is, on the
relevant date, an officer, director or ten percent beneficial owner of any class
of the Company's equity securities that is registered pursuant to Section 12 of
the Exchange Act, all as defined under Section 16 of the Exchange Act,
transactions under this Plan are intended to comply with all applicable
conditions of Rule 16b-3 under the Exchange Act, or any successor rule. To the
extent any provision of the Plan
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or action by the Committee fails to so comply, it will be deemed null and void,
to the extent permitted by law and deemed advisable by the Committee.
18.5 Awards to Foreign Nationals and Employees Outside the United States.
To the extent the Committee deems it necessary, appropriate or desirable to
comply with foreign law of practice and to further the purposes of this Plan,
the Committee may, without amending the Plan, (i) establish rules applicable to
Awards granted to Participants who are foreign nationals, are employed outside
the United States, or both, including rules that differ from those set forth in
this Plan, and (ii) grant Awards to such Participants in accordance with those
rules.
18.6 Unfunded Status of the Plan. The Plan is intended to constitute an
"unfunded" plan for incentive and deferred compensation. With respect to any
payments or deliveries of Shares not yet made to a Participant by the Company,
the Participant's rights are no greater than those of a general creditor of the
Company. The Committee may authorize the establishment of trusts or other
arrangements to meet the obligations created under the Plan, so long as the
arrangement does not cause the Plan to lose its legal status as an unfunded
plan.
18.7 Governing Law. To the extent not preempted by federal law, the Plan
and all agreements hereunder will be construed in accordance with and governed
by the laws of the State of Delaware.
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EXHIBIT 4.2
Restricted Stock Award Agreement
--------------------------------
Under
-----
Heller Financial, Inc. 1998 Stock Incentive Plan
------------------------------------------------
This Restricted Stock Award Agreement (the "Agreement") is entered into
this __ day of May, 1998 (the "Effective Date") between Heller Financial, Inc.
(the "Company") and _ (the "Participant"). Any term capitalized but not defined
in this Agreement will have the meaning set forth in the Heller Financial, Inc.
1998 Stock Incentive Plan (the "Plan").
The Plan provides for the grant of restricted stock to key employees of the
Company or its Subsidiaries as approved by the Committee. In exercise of its
discretion under the Plan, the Committee has determined that the Participant
should receive a restricted stock award under the Plan and, accordingly, the
Company and the Participant hereby agree as follows:
1. Grant. The Company hereby grants to the Participant a Restricted Stock
Award (the "Award") of _ shares of Class A Common Stock, $0.25 par value,
of the Company ("Common Stock"). The Award will be subject to the terms
and conditions of the Plan and this Agreement. The Award constitutes the
right, subject to the terms and conditions of the Plan and this Agreement,
to distribution of shares of Common Stock (known as "Restricted Shares" or
"Shares").
2. Stock Certificates. Certificates for the Restricted Shares will be issued
in the Participant's name and will be held by the Secretary of the Company
until: (i) the Shares are forfeited; or (ii) the Shares vest. The
Certificates will be distributed to the Participant or, if applicable, his
or her beneficiary, in accordance with Section 5 below.
3. Rights as Stockholder. On and after the Effective Date, and except to the
extent provided in Section 9 below, the Participant will be entitled to all
of the rights of a stockholder with respect to the Restricted Shares,
including the right to vote the Restricted Shares and to receive dividends
and other distributions payable with respect to the Restricted Shares.
4. Vesting; Effect of Termination of Employment. Subject to the provisions of
Article 14 of the Plan, the Participant's Restricted Shares will become
vested on the earliest of:
(a) January 1, 2001, if (i) the Participant is continuously employed by
the Company or an Affiliate from the Effective Date until that date
and (ii) the Company has experienced an average growth in its annual
Net Income applicable to Common Stock of 13.5% over the three calendar
years preceding that date;
(b) January 1, 2004, if the Participant has been continuously employed by
the Company or an Affiliate from the Effective Date until that date;
and
(c) the date the Participant's employment with the Company and all
Affiliates is terminated on account of the Participant's death or
Disability.
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If the Participant terminates employment with the Company and all
Affiliates for a reason other than death or Disability, and before any of
his or her Restricted Shares have become vested under this Agreement, the
Participant's Restricted Shares that have not become vested will be
forfeited on and after the effective date of the termination. Neither the
Company nor any Subsidiary will have any further obligations to the
Participant under this Agreement if the Participant's Restricted Shares are
forfeited.
For purposes of this Agreement:
(a) "Net Income" means net income as reported in the Company's annual
audited financial statements.
(b) "Disability" means long-term disability as defined under the long-term
disability plan of the Company or a Subsidiary that covers the
Participant, or, if the Participant is not covered by a long-term
disability plan sponsored by the Company or a Subsidiary, the
Participant's inability to engage in any substantial gainful activity
by reason of any medically-determined physical or mental impairment
that can be expected to result in death or to be of long-continued and
indefinite duration. The Committee will determine whether a
Participant terminates employment on account of Disability, and may
require proof of Disability in such form and manner as it deems
appropriate. The Committee's interpretation will be final and
binding.
5. Terms and Conditions of Distribution. Certificates for Restricted Shares
will be distributed as soon as practicable after they vest. If the
Participant dies, either before or after termination of employment, before
his or her vested Restricted Shares have been distributed, certificates for
the Shares will be distributed to the beneficiary or beneficiaries he or
she designated, in the proportions he or she specified. To be effective, a
beneficiary designation must be made in writing. If the Participant failed
to designate a beneficiary or beneficiaries, certificates for the Shares
will be distributed to the Participant's personal representative.
Certificates for the Shares will be distributed no later than six months
after the Participant's death.
Distribution will not be made before the first date the Restricted Shares
may be distributed to the Participant without penalty or forfeiture under
federal or state laws or regulations governing short swing trading of
securities. In determining whether a distribution would result in such a
penalty or forfeiture, the Company and the Committee may rely upon
information reasonably available to them or upon representations of the
Participant's legal or personal representative.
6. Legend on Stock Certificates. The Company may require that certificates of
Common Stock distributed to the Participant pursuant to this Agreement bear
the following legend, or another legend that counsel to the Company
believes is desirable to facilitate compliance with applicable securities
laws:
The securities represented by this certificate may not be sold or
transferred unless they have first been registered under the
Securities Act of 1933, as amended, or unless counsel satisfactory to
Heller
-2-
<PAGE>
Financial, Inc. has given an opinion that registration under
such Act is not required.
7. Delivery of Certificates. Despite the provisions of Section 4, the Company
is not required to issue or deliver any certificates for shares of Common
Stock before completing the steps necessary to comply with applicable
federal and state securities laws (including any registration requirements)
and applicable stock exchange rules and practices. The Company will use
commercially reasonable efforts to cause compliance with those laws, rules
and practices.
8. No Right to Employment. Nothing in the Plan or this Agreement will be
construed as creating any right in the Participant to continued employment,
or as altering or amending the existing terms and conditions of employment
of the Participant.
9. Nontransferability. No interest of the Participant or any beneficiary in
or under this Agreement will be assignable or transferable by voluntary or
involuntary act or by operation of law, other than by testamentary bequest
or devise or the laws of descent or distribution. All rights of the
Participant and his or her beneficiary in and under this Agreement will be
wholly inalienable and beyond the power of any person to anticipate or in
any way create a lien or encumbrance upon them. Distribution of Restricted
Shares will be made only to the Participant; or, if the Committee has been
provided with evidence acceptable to it that the Participant is legally
incompetent, the Participant's personal representative; or, if the
Participant is deceased, to the beneficiaries or personal representative
that have been designated by the Participant in the manner required by the
Committee. The Committee may require personal receipts or endorsements of
a Participant's personal representative or beneficiaries. Any effort to
assign or transfer a right under this Agreement in contravention of this
Section 9 will be wholly ineffective, and will be grounds for termination
by the Committee of all rights of the Participant and his or her
beneficiary in and under this Agreement.
10. Withholding. As a condition precedent to distributing the Restricted
Shares, the Company may require the Participant or beneficiary to pay it
the amount it or a Subsidiary is required to withhold for federal, state or
local taxes. The amount to be withheld may be effected by the Employee's
agreeing that a portion of the Restricted Shares to which he or she would
otherwise be entitled shall be returned to the Company or a Subsidiary.
11. Administration. The Committee administers the Plan. The Participant's
rights under this Agreement are expressly subject to the terms and
conditions of the Plan, including continued shareholder approval of the
Plan, and to any guidelines the Committee adopts from time to time. The
Participant hereby acknowledges receipt of a copy of the Plan.
12. Interpretation. Any interpretation by the Committee of the terms and
conditions of the Plan, this Agreement or any guidelines adopted as
described in Section 11 will be final. This Agreement will be governed by
and construed under the laws of the State of Delaware.
-3-
<PAGE>
13. Sole Agreement. This Agreement is the entire Agreement between the parties
to it, and any and all prior oral and written representations are merged in
this Agreement. This Agreement may be amended only by written agreement
between the Participant and the Company.
In Witness Whereof, the Company and the Participant have duly executed this
Agreement as of the day and year first above written.
Heller Financial, Inc.
By:
_______________________________________
Its:
______________________________________
__________________________________________
(Participant's Signature)
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<PAGE>
Special Restricted Stock Award Agreement
----------------------------------------
Under
-----
Heller Financial, Inc. 1998 Stock Incentive Plan
------------------------------------------------
This Special Restricted Stock Award Agreement (the "Agreement") is entered
into this __ day of May, 1998 (the "Effective Date") between Heller Financial,
Inc. (the "Company") and _ (the "Participant"). Any term capitalized but not
defined in this Agreement will have the meaning set forth in the Heller
Financial, Inc. 1998 Stock Incentive Plan (the "Plan").
The Plan provides for the grant of restricted stock to key employees of the
Company or its Subsidiaries as approved by the Committee. In exercise of its
discretion under the Plan, the Committee has determined that the Participant
should receive a restricted stock award under the Plan and, accordingly, the
Company and the Participant hereby agree as follows:
1. Grant. The Company hereby grants to the Participant a Special Restricted
Stock Award (the "Award") of _ shares of Class A Common Stock, $0.25 par
value, of the Company ("Common Stock"). The Award will be subject to the
terms and conditions of the Plan and this Agreement. The Award constitutes
the right, subject to the terms and conditions of the Plan and this
Agreement, to distribution of shares of Common Stock (known as "Special
Restricted Shares" or "Shares").
2. Stock Certificates. Certificates for the Special Restricted Shares will be
issued in the Participant's name and will be held by the Secretary of the
Company until: (i) the Shares are forfeited; or (ii) the Shares vest. The
Certificates will be distributed to the Participant or, if applicable, his
or her beneficiary, in accordance with Section 5 below.
3. Rights as Stockholder. On and after the Effective Date, and except to the
extent provided in Section 9 below, the Participant will be entitled to all
of the rights of a stockholder with respect to the Special Restricted
Shares, including the right to vote the Shares and to receive dividends and
other distributions payable with respect to the Shares.
4. Vesting; Effect of Termination of Employment. Subject to the provisions of
Article 14 of Plan, the Participant's Special Restricted Shares will become
vested on the earliest of:
(a) January 1, 2001, if (i) the Participant is continuously employed by
the Company or an Affiliate from the Effective Date until that date
and (ii) the Company has experienced an average growth in its annual
Net Income applicable to Common Stock of 16.5% over the three calendar
years preceding that date;
(b) January 1, 2004, if the Participant has been continuously employed by
the Company or an Affiliate from the Effective Date until that date;
and
(c) the date the Participant's employment with the Company and all
Affiliates is terminated on account of the Participant's death or
Disability.
If the Participant terminates employment with the Company and all
Affiliates for a reason other than death or Disability, and before any of
his or her Special Restricted Shares have become vested under this
Agreement, the Participant's Special Restricted Shares that have
<PAGE>
not become vested will be forfeited on and after the effective date of the
termination. Neither the Company nor any Subsidiary will have any further
obligations to the Participant under this Agreement if the Participant's
Special Restricted Shares are forfeited.
For purposes of this Agreement:
(a) "Net Income" means net income as reported in the Company's annual
audited financial statements.
(b) "Disability" means long-term disability as defined under the long-term
disability plan of the Company or a Subsidiary that covers the
Participant, or, if the Participant is not covered by a long-term
disability plan sponsored by the Company or a Subsidiary, the
Participant's inability to engage in any substantial gainful activity
by reason of any medically-determined physical or mental impairment
that can be expected to result in death or to be of long-continued and
indefinite duration. The Committee will determine whether a
Participant terminates employment on account of Disability, and may
require proof of Disability in such form and manner as it deems
appropriate. The Committee's interpretation will be final and
binding.
5. Terms and Conditions of Distribution. Certificates for Special Restricted
Shares will be distributed as soon as practicable after they vest. If the
Participant dies, either before or after termination of employment, before
his or her vested Special Restricted Shares have been distributed,
certificates for the Shares will be distributed to the beneficiary or
beneficiaries he or she designated, in the proportions he or she specified.
To be effective, a beneficiary designation must be made in writing. If the
Participant failed to designate a beneficiary or beneficiaries,
certificates for the Shares will be distributed to the Participant's
personal representative. Certificates for the Shares will be distributed
no later than six months after the Participant's death.
Distribution will not be made before the first date the Special Restricted
Shares may be distributed to the Participant without penalty or forfeiture
under federal or state laws or regulations governing short swing trading of
securities. In determining whether a distribution would result in such a
penalty or forfeiture, the Company and the Committee may rely upon
information reasonably available to them or upon representations of the
Participant's legal or personal representative.
6. Legend on Stock Certificates. The Company may require that certificates of
Common Stock distributed to the Participant pursuant to this Agreement bear
the following legend, or another legend that counsel to the Company
believes is desirable to facilitate compliance with applicable securities
laws:
The securities represented by this certificate may not be sold or
transferred unless they have first been registered under the
Securities Act of 1933, as amended, or unless counsel satisfactory to
Heller Financial, Inc. has given an opinion that registration under
such Act is not required.
-2-
<PAGE>
7. Delivery of Certificates. Despite the provisions of Section 4, the Company
is not required to issue or deliver any certificates for shares of Common
Stock before completing the steps necessary to comply with applicable
federal and state securities laws (including any registration requirements)
and applicable stock exchange rules and practices. The Company will use
commercially reasonable efforts to cause compliance with those laws, rules
and practices.
8. No Right to Employment. Nothing in the Plan or this Agreement will be
construed as creating any right in the Participant to continued employment,
or as altering or amending the existing terms and conditions of employment
of the Participant.
9. Nontransferability. No interest of the Participant or any beneficiary in
or under this Agreement will be assignable or transferable by voluntary or
involuntary act or by operation of law, other than by testamentary bequest
or devise or the laws of descent or distribution. All rights of the
Participant and his or her beneficiary in and under this Agreement will be
wholly inalienable and beyond the power of any person to anticipate or in
any way create a lien or encumbrance upon them. Distribution of Special
Restricted Shares will be made only to the Participant; or, if the
Committee has been provided with evidence acceptable to it that the
Participant is legally incompetent, the Participant's personal
representative; or, if the Participant is deceased, to the beneficiaries or
personal representative that have been designated by the Participant in the
manner required by the Committee. The Committee may require personal
receipts or endorsements of a Participant's personal representative or
beneficiaries. Any effort to assign or transfer a right under this
Agreement in contravention of this Section 9 will be wholly ineffective,
and will be grounds for termination by the Committee of all rights of the
Participant and his or her beneficiary in and under this Agreement.
10. Withholding. As a condition precedent to distributing the Special
Restricted Shares, the Company may require the Participant or beneficiary
to pay it the amount it or a Subsidiary is required to withhold for
federal, state or local taxes. The amount to be withheld may be effected
by the Employee's agreeing that a portion of the Special Restricted Shares
to which he or she would otherwise be entitled shall be returned to the
Company or a Subsidiary.
11. Administration. The Committee administers the Plan. The Participant's
rights under this Agreement are expressly subject to the terms and
conditions of the Plan, including continued shareholder approval of the
Plan, and to any guidelines the Committee adopts from time to time. The
Participant hereby acknowledges receipt of a copy of the Plan.
12. Interpretation. Any interpretation by the Committee of the terms and
conditions of the Plan, this Agreement or any guidelines adopted as
described in Section 11 will be final. This Agreement will be governed by
and construed under the laws of the State of Delaware.
13. Sole Agreement. This Agreement is the entire Agreement between the parties
to it, and any and all prior oral and written representations are merged in
this Agreement. This Agreement may be amended only by written agreement
between the Participant and the Company.
-3-
<PAGE>
In Witness Whereof, the Company and the Participant have duly executed this
Agreement as of the day and year first above written.
Heller Financial, Inc.
By:_______________________________________
Its:______________________________________
___________________________________________
(Participant's Signature)
-4-
<PAGE>
EXHIBIT 4.3
Nonqualified Stock Option Award Agreement
-----------------------------------------
under
-----
Heller Financial, Inc. 1998 Stock Incentive Plan
------------------------------------------------
This Nonqualified Stock Option Award Agreement (the "Agreement") dated this
__ day of May, 1998, between Heller Financial, Inc. (the "Company"), and _
(the "Participant"), who is a key employee of the Company or a Subsidiary. Any
term capitalized but not defined in this Agreement will have the meaning set
forth in the Heller Financial, Inc. 1998 Stock Incentive Plan (the "Plan").
1. Award. In accordance with the terms of the Plan, the Company hereby grants
to the Participant a stock option Award to purchase all or any part of an
aggregate of _ Shares. This Award constitutes a nonqualified stock option
and is not intended to be an incentive stock option within the meaning of
Section 422 of the Code.
2. Exercise Price. The Exercise Price will be $________ per Share, which is
no less than the Fair Market Value of a Share on the date of this
Agreement.
3. Medium and Time of Payment.
a. The Exercise Price must be paid in United States dollars, in cash or
by personal check payable to the order of the Company, at the time of
purchase.
b. Alternatively, the Exercise Price, or any part of it, may be paid
with: (i) Shares owned by the Participant duly endorsed for transfer
to the Company; (ii) Shares issuable to the Participant upon exercise
of the Option; or (iii) any combination of cash, personal check and
Shares meeting the requirements of clause (i) or (ii) above.
c. The Company will pay the amount of tax it is required to withhold on
account of exercise of all or part of the Award with Shares otherwise
issuable to the Participant upon exercise under the Award.
Notwithstanding the foregoing, if the Committee agrees, the
Participant may satisfy the Company's withholding obligation by paying
the amount of required withholding to the Company and, if he or she
does so, the Company will not withhold Shares as described in the
preceding sentence. If the Award has been transferred pursuant to
Section 6(b), the Participant must satisfy the Company's withholding
requirement by paying the Company the amount it is required to
withhold with: (i) United States dollars in cash or by personal
check; (ii) Shares owned by the Participant and duly endorsed for
transfer to the Company; or (iii) any combination of cash, personal
check, and Shares meeting the requirements of clause (ii) above. If
part or all of the Award has been transferred pursuant to Section
6(b), the withholding obligation may not be satisfied with Shares
issuable upon exercise of the Award.
d. Shares used to satisfy the Exercise Price and/or any minimum required
withholding tax will be valued at their Fair Market Value as
determined by the Committee as of the date of exercise.
-1-
<PAGE>
e. No Shares will be issued pursuant to the Award before the Exercise
Price and, if applicable, the withholding obligation, have been paid
in full.
4. Term, Vesting and Exercise of the Award.
a. The Award will expire ten years from the date of this Agreement.
b. The Award will vest and become exercisable on the earlier of: (i)
January 1, 2001; and (ii) the Participant's death or Disability.
c. Notwithstanding any other provision of this Agreement, the Participant
will forfeit his or her right to exercise the Award, whether or not it
has already vested, if the Committee determines in its sole discretion
that the Participant has been discharged from employment with the
Company or an Affiliate for Cause.
d. After the Award has vested, and while it is exercisable, it may be
exercised in whole or in part by written notice to the Company
indicating the number of Shares being purchased. The notice must be
signed by the Participant and must be accompanied by full payment of
the Exercise Price plus, if applicable, any required withholding tax.
Notwithstanding the foregoing, the Award may not be exercised for
fewer than 100 Shares at any one time or, if fewer than 100 Shares
remain, all the then-remaining Shares. An Award must be exercised as
to a whole number of Shares.
5. Termination of Employment. After termination of employment, the
Participant's right to exercise the Award will be subject to the following
rules.
a. Retirement. If the Participant terminates employment through
Retirement, he or she may exercise any Award that had vested and was
exercisable on the date of his or her Retirement. If the Participant
dies after Retirement but before fully exercising the Award, his or
her estate will have the right to exercise any Award that had vested
and was exercisable on the date the Participant retired. In either
case, the Award must be exercised, if at all, within thirteen months
after the Participant's termination of employment, or, if earlier, by
the time the Award would otherwise have expired under the terms of
this Agreement. If the Participant terminates employment through
Retirement, he or she will forfeit the Award to the extent that it was
not vested and exercisable on the date he or she terminated
employment.
b. Disability or Death. If the Participant terminates employment through
Disability or death, the Award will immediately vest and become
exercisable. The Participant (or in the case of his or her death, the
Participant's estate) may exercise the Award within the thirteen-month
period following the termination, or, if earlier, by the date the
Award would otherwise have expired.
-2-
<PAGE>
c. Voluntary Termination. If the Participant voluntarily terminates
employment for any reason other than Retirement, Disability or death,
the Participant will immediately forfeit the right (whether or not it
had previously vested) to exercise the Award.
d. Involuntary Termination. If employment terminates for any reason
other than Retirement, Disability, death or voluntary termination, the
Participant (or, in the case of his or her subsequent death, the
Participant's estate): (i) may, within the 30-day period following
the termination, exercise the Award to the extent that it was vested
and exercisable on the date of the termination and (ii) will forfeit
the Award to the extent that it was not vested and exercisable on the
date of the termination.
e. Initial Public Offering Protection. Notwithstanding the provisions of
paragraphs (a) through (d) above, if, within three years after the
Company's initial public offering of Shares, (i) the Participant's
employment with the Company and all Affiliates is terminated for a
reason other than Cause, or (ii) the Participant terminates his or her
employment with the Company and all Affiliates for Good Reason, the
Award will immediately vest and become fully exercisable, and will
remain exercisable until the date that is ten years after the date of
this Agreement unless otherwise specifically prohibited under
applicable law or by applicable rules and regulations of any
governmental agency or national securities exchange.
6. Transferability of Award and Shares Acquired Upon Exercise of Award.
a. The Participant may not sell, transfer, pledge, assign or otherwise
alienate or hypothecate the Award, other than by will or the laws of
descent and distribution.
b. Notwithstanding any other provision of this Agreement, the Participant
may transfer any portion of this Award to: (i) the Participant's
spouse, children, step-children, grandchildren or step-grandchildren
("Immediate Family Members"); (ii) a trust or trusts for the exclusive
benefit of Immediate Family Members; (iii) a partnership in which
Immediate Family Members are the only partners; or (iv) an
organization exempt from taxation under Section 501(c)(3) of the Code.
Such a transfer is permitted only if there is no consideration for the
transfer, or the transfer is to a partnership in which Immediate
Family Members are the only partners and the Participant's sole
consideration for the transfer is an interest in the partnership.
Such a transfer will become effective only if the Participant gives
the Committee advance written notice of the transfer and complies with
any conditions imposed by the Committee. Following the transfer, the
transferee will be subject to the same terms and conditions as the
Participant was immediately before the transfer, and the term
"Participant" as used in this Agreement will be deemed to refer to the
transferee, except for purposes of Sections 4(d) and 5, which will
continue to apply with respect to the original Participant. The
transferee of an Award may not transfer the Award except as provided
in paragraph (a).
c. During the Participant's lifetime, only the Participant (or a
transferee pursuant to paragraph (b) above) or his or her guardian or
legal representative may exercise the
-3-
<PAGE>
Award. The Committee may, in its discretion, require a guardian or
legal representative to supply it with the evidence the Committee
reasonably deems necessary to establish the authority of the guardian
or legal representative to exercise the Award on behalf of the
Participant or transferee, as the case may be.
d. Except as limited by applicable federal or state securities laws, the
requirements of any stock exchange or market upon which the Shares are
listed or traded at any given time, and the provisions of Section 7,
Shares acquired upon exercise of this Award will be freely
transferable.
7. Securities Law Requirements.
a. If at any time the Committee determines that exercising the Award or
issuing Shares would violate applicable securities laws, the Award
will not be exercisable, and the Company will not be required to issue
Shares. The Committee may declare any provision of this Agreement or
action of its own null and void, if it determines the provision or
action fails to comply with the short-swing trading rules. As a
condition to exercise, the Company may require the Participant to make
written representations it deems necessary or desirable to comply with
applicable securities laws.
b. No person who acquires Shares under this Agreement may sell the
Shares, unless the offer and sale are made pursuant to an effective
registration statement under that Act, which is current and includes
the Shares to be sold, or an exemption from the registration
requirements of that Act.
8. No Obligation to Exercise Award. Neither the Participant nor his or her
transferee is or will be obligated by the grant of the Award to exercise
it.
9. No Limitation on Rights of the Company. The grant of the Award does not and
will not in any way affect the right or power of the Company to make
adjustments, reclassifications or changes in its capital or business
structure, or to merge, consolidate, dissolve, liquidate, sell or transfer
all or any part of its business or assets.
10. Plan and Agreement Not a Contract of Employment. Neither the Plan nor this
Agreement is a contract of employment, and no terms of employment of the
Participant will be affected in any way by the Plan, this Agreement or
related instruments, except to the extent specifically expressed therein.
Neither the Plan nor this Agreement will be construed as conferring any
legal rights of the Participant to continue to be employed, nor will it
interfere with the Company's or any Subsidiary's right to discharge the
Participant or to deal with him or her regardless of the existence of the
Plan, this Agreement or the Award.
11. Participant to Have No Rights as a Stockholder. Before the date as of which
he or she is recorded on the books of the Company as the holder of any
Shares underlying the Award, the Participant will have no rights as a
stockholder with respect to those Shares.
-4-
<PAGE>
12. Notice. Any notice or other communication required or permitted under this
Agreement must be in writing and must be delivered personally, sent by
certified, registered or express mail, or sent by overnight courier, at the
sender's expense. Notice will be deemed given when delivered personally or,
if mailed, three days after the date of deposit in the United States mail
or, if sent by overnight courier, on the regular business day following the
date sent. Notice to the Company should be sent to Heller Financial, Inc.,
500 West Monroe Street, Chicago, Illinois 60661, Attention: Corporate
Secretary. Notice to the Participant should be sent to the address set
forth on the signature page below.
13. Successors. All obligations of the Company under this Agreement will be
binding on any successor to the Company, whether the existence of the
successor results from a direct or indirect purchase of all or
substantially all of the business and/or assets of the Company, or a
merger, consolidation, or otherwise.
14. Governing Law. This Agreement will be construed and enforced in accordance
with, and governed by, the laws of the State of Delaware, determined
without regard to its conflict of law rules.
15. Plan Document Controls. The rights granted under this Agreement are in all
respects subject to the provisions set forth in the Plan to the same extent
and with the same effect as if set forth fully in this Agreement. If the
terms of this Agreement conflict with the terms of the Plan document, the
Plan document will control.
IN WITNESS WHEREOF, the Company and the Participant have duly executed this
Agreement as of the date first written above.
HELLER FINANCIAL, INC.
By:
______________________________________
Its:
______________________________________
__________________________________________
(Participant's Signature)
Participant's Name and Address for notices
__________________________________________
__________________________________________
__________________________________________
-5-
<PAGE>
EXHIBIT 5.1
Opinion of Counsel
May 5, 1998
Heller Financial, Inc.
500 West Monroe Street
Chicago, IL 60661
RE: Registration Statement on Form S-8 of Heller Financial, Inc.
(the "Registration Statement")/1998 Stock Incentive Plan
Ladies and Gentleman:
I have acted as Associate General Counsel for Heller Financial, Inc., a
Delaware corporation (the "Company"), in connection with the registration on
Form S-8 of the offer and sale of up to 6,718,125 shares of the Company's Class
A Common Stock, par value $.25 per share (the Class A "Common Stock"), issuable
pursuant to the grant of certain restricted stock and other awards or upon
exercise of certain stock options (collectively, the "Plan Awards") that may be
issued pursuant to the Heller Financial, Inc. 1998 Stock Incentive Plan (the
"Plan").
This opinion is delivered in accordance with the requirements of Item
601(b)(5) of the Regulation S-K under the Securities Act of 1933, as amended
(the "Act").
In connection with this opinion, I have examined and am familiar with
originals or copies, certified or otherwise identified to my satisfaction, of:
(i) the Registration Statement to be filed with the Securities and Exchange
Commission (the "Commission") under the Act; (ii) the Amended and Restated
Certificate of Incorporation of the Company, as currently in effect; (iii) the
Amended and Restated By-Laws of the Company, as currently in effect; (iv) the
Plan; and (v) resolutions of the Board of Directors of the Company relating to,
among other things, the filing of the Registration Statement and the approval of
the Plan. I have also examined such other documents as I have deemed necessary
or appropriate as a basis for the opinion set forth below.
In my examination, I have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to me
<PAGE>
as certified or photostatic copies and the authenticity of the originals of all
documents. I have also assumed that the Company's Board of Directors, or a duly
authorized committee thereof, will have approved the issuance of each Plan Award
prior to the issuance thereof. As to any facts material to this opinion which I
did not independently establish or verify, I have relied upon oral or written
statements and representations of officers and other representatives of the
Company and others.
Based upon and subject to the foregoing, I am of the opinion that all
shares of Common Stock issued pursuant to the Plan will be, upon exercise of
grant or Plan Awards in accordance with the terms of the Plan and, if
applicable, payment of the specified exercise price therefor, legally issued,
fully paid and non-assessable shares of Common Stock.
I hereby consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement. In giving such consent, I do not concede
that I am an expert within the meaning of the Act or the rules and regulations
thereunder or that this consent is required by Section 7 of the Act.
Very truly yours,
/s/ Mark J. Ohringer
Mark J. Ohringer
Associate General Counsel
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our report
included in this registration statement and to the incorporation by reference in
this registration statement of our report dated January 23, 1998 (except with
respect to the matters discussed in Note 20, as to which the date is February
24, 1998) included in Heller Financial, Inc.'s Form 10-K/A for the year ended
December 31, 1997 and to all references to our firm included in this
registration statement.
/s/ Arthur Andersen LLP
Chicago, Illinois
April 29, 1998
