As filed with the Securities and Exchange Commission on July 8, 1994
Registration Statement No. 33-____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
____________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
____________________
LOWE'S COMPANIES, INC.
(Exact name of Registrant as specified in its Charter)
North Carolina 56-0578072
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
P. O Box 1111
North Wilkesboro, North Carolina 28656-0001
(Address of principal executive office, including zip code)
LOWE'S COMPANIES, INC.
1994 INCENTIVE PLAN
(Full title of the Plan)
____________________
Leonard G. Herring
President and Chief Executive Officer
Lowe's Companies, Inc.
P. O. Box 1111
North Wilkesboro, North Carolina 28656-0001
919-651-4000
(Name, address and telephone number including, area code, of agent for service)
With copies to:
Lathan M. Ewers, Jr. Leonard G. Herring
Hunton & Williams President and Chief Executive Officer
Riverfront Plaza, East Tower Lowe's Companies, Inc.
951 East Byrd Street P. O. Box 1111
Richmond, Virginia 23219-4074 North Wilkesboro, North Carolina 28656-0001
804-788-8200 919-651-4000
CALCULATION OF REGISTRATION FEE
<TABLE>
Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate Amount of
to be registered registered per share(1) offering price(1) registration fee
<S> <C> <C> <C> <C>
Common Stock, par 1,000,000 $34.25 $34,250,000 $11,811
value $.50
Rights to N/A N/A N/A $100
Purchase Series A
Participating
Cumulative
Preferred Stock,
par value $5.00
per share (2)
</TABLE>
(1) Estimated solely for the purpose of computing the registration
fee. This amount was calculated pursuant to Rule 457(h)(1) on the basis
of $34.25 per share, which was the average of the high and low sales
prices of the Common Stock as reported on the New York Stock Exchange on
June 30, 1994.
(2) Prior to the occurrence of certain events, the Rights will not
be certified separately from the Common Stock. Value attributable to the
Rights, if any, will be reflected in the market price of the shares of
Common Stock. The fee paid is the minimum statutory fee pursuant to
Section 6(b) of the Securities Act of 1933.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
Not required to be filed with the Securities and Exchange Commission
(the "Commission").
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed with the Commission.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by Lowe's Companies, Inc. (the
"Company") with the Commission (file No. 1-7083) are incorporated herein
by reference and made a part hereof: (i) the Company's Annual Report on
Form 10-K for the fiscal year ended January 31, 1994; (ii) the Company's
Quarterly Report on Form 10-Q for the quarter ended April 30, 1994; and
(iii) the description of the Company's Common Stock (the "Common Stock")
contained in the Company's registration statement on Form 8-A filed under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
including any amendment or report filed for the purpose of updating such
description.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of the Prospectus and prior
to the filing of a post- effective amendment that indicates that all
securities offered have been sold or that deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in the
Prospectus and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes
of the Prospectus to the extent that a statement contained herein or in
any other subsequently filed document that is incorporated by reference
herein modifies or supersedes such earlier statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of the Prospectus.
Effective May 27, 1994, the Company's 1985 Stock Option Plan was
amended to, among other things, change the name of the plan to the "1994
Incentive Plan" and authorize the issuance of an additional 1,000,000
shares of the Company's Common Stock, par value $.50 per share, which
additional shares are covered by this registration statement. The
contents of the Company's prior registration statement (file no. 33-2618,
filed with the Commission on January 8, 1986) in connection with the 1985
Stock Option Plan, are incorporated herein by reference.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
<PAGE>
Item 6. Indemnification of Directors and Officers.
Article IV of the Company's Bylaws provides that the Company will
indemnify any person as an officer or director of the Company or as an
officer, director, trustee or partner of another corporation, trust,
partnership or employee benefit plan at the request of the Company,
against any liability incurred in connection with any proceeding arising
out of such service. To the extent that such person is successful on the
merits or otherwise in defense of any such proceeding, the Company will
indemnify him against expenses actually and reasonably incurred in such
defense. No indemnification is available if, at the time of the
activities which are the subject of the proceeding, such person knew or
believed that such activities were clearly in conflict with the best
interests of the Company. Further, Section 55-8-51 of the North Carolina
Business Corporation Act provides that a corporation may not indemnify a
director in connection with a proceeding by or in the right of the
corporation in which such director was adjudged liable to the corporation
or in connection with any other proceeding charging improper personal
benefit to him, whether or not involving action in his official capacity,
in which is adjudged liable on the basis that personal benefit was
improperly received by him.
The Company maintains an insurance policy for the benefit of
directors and officers insuring them against claims that are made against
them by reason of any wrongful act (as defined) committed in their
capacity as directors or officers.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit No.
4.1 Rights Agreement dated September 9, 1988, between the Company and
Wachovia Bank & Trust Co., N.A., as Rights Agent (Incorporated
herein by reference from Exhibit 4.1 of the Company's Current Report
on Form 8-K dated September 9, 1988).
4.2 Lowe's Companies, Inc. 1994 Incentive Plan.
5 Opinion of Hunton & Williams as to the legality of the securities
being registered.
23.1 Consent of Hunton & Williams (included in the opinion filed as
Exhibit 5 to the Registration Statement).
23.2 Consent of Deloitte & Touche.
24 Power of Attorney for Officers and Directors (included on page II-5
of the Registration Statement).
Item 9. Undertakings
(a) The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are
made, a post- effective amendment to this registration statement;
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, as amended
(the "Securities Act");
<PAGE>
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the
registration statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth in
the registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously
disclosed in the registration statement or any
material change in such information in the
registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply
if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the registration statement.
2. That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each
filing of the registrant's annual report pursuant to Section 13(a) or
15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Exchange Act) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions described under Item
6 above, or otherwise, the registrant has been advised that in the opinion
of the Commission such indemnification is against public policy as
expressed in the Securities Act, and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes Leonard
G. Herring, President and Chief Executive Officer, Lowe's Companies, Inc.
P. O. Box 1111, North Wilkesboro, North Carolina 28656-0001, Lathan M.
Ewers, Jr., Esq., Hunton & Williams, Riverfront Plaza, East Tower, 951
East Byrd Street, Richmond, Virginia 23219-4074, to sign in the name of
each such person, and to file, any amendment, including any post-effective
amendment, to the registration statement and appoints such persons, to
sign on his behalf individually and in each capacity stated below and to
file all amendments and post- effective amendments to the Registration
Statement and Lowe's Companies, Inc. hereby confers like authority to sign
and file on its behalf.
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the North Wilkesboro, North Carolina, on
this 7th day of July, 1994.
LOWE'S COMPANIES, INC.
(Registrant)
By /s/ Leonard G. Herring
Leonard G. Herring, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act, this
registration statement has been signed by the following persons in the
capacities indicated on this 7th day of July, 1994.
Signature Title
By /s/ Robert L. Strickland Chairman of the Board of
Robert L. Strickland Directors and Director
By /s/ Leonard G. Herring President, Chief Executive
Leonard G. Herring Officer and Director
(Principal Executive
Officer)
By /s/ Harry B. Underwood II Senior Vice President,
Harry B. Underwood II Treasurer and Chief
Financial Officer and
Director (Principal
Financial Officer)
By /s/ Richard D. Elledge Vice President and Chief
Richard D. Elledge Accounting Officer
(Principal Accounting
Officer)
By /s/ William A. Andres Director
William A. Andres
By /s/ John M. Belk Director
John M. Belk
By /s/ Carol A. Farmer Director
Carol A. Farmer
By /s/ Petro Kulynych Director
Petro Kulynych
By /s/ Russell B. Long Director
Russell B. Long
By /s/ Robert G. Schwartz Director
Robert G. Schwartz
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
4.1 Rights Agreement dated September 9, 1988,
between the Company and Wachovia Bank &
Trust Co., N.A., as Rights Agent
(Incorporated herein by reference from
Exhibit 4.1 of the Company's current report
on Form 8-K dated September 9, 1988).
4.2 Lowe's Companies, Inc. 1994 Incentive Plan.
5 Opinion of Hunton & Williams as to the
legality of the securities being registered.
23.1 Consent of Hunton & Williams (included in
the opinion filed as Exhibit 5 to the
Registration Statement).
23.2 Consent of Deloitte & Touche.
24 Power of Attorney for Officers and Directors
(included on page II-5 of the Registration
Statement).
LOWE'S COMPANIES, INC.
1994 INCENTIVE PLAN
Effective January 31, 1994
As Amended And Restated To
Reflect March 7, 1994 Amendments and
March 16, 1994 Stock Split
<PAGE>
ARTICLE I DEFINITIONS
1.01. Administrator . . . . . . . . . . . . . . . . . . . 1
1.02. Affiliate . . . . . . . . . . . . . . . . . . . . . 1
1.03. Agreement . . . . . . . . . . . . . . . . . . . . . 1
1.04. Beginning Value . . . . . . . . . . . . . . . . . . 1
1.05. Board . . . . . . . . . . . . . . . . . . . . . . . 1
1.06. Change in Control . . . . . . . . . . . . . . . . . 1
1.07. Code. . . . . . . . . . . . . . . . . . . . . . . . 2
1.08. Committee . . . . . . . . . . . . . . . . . . . . . 2
1.09. Common Stock. . . . . . . . . . . . . . . . . . . . 2
1.10. Company . . . . . . . . . . . . . . . . . . . . . . 2
1.11. Control Change Date . . . . . . . . . . . . . . . . 3
1.12. Exchange Act. . . . . . . . . . . . . . . . . . . . 3
1.13. Fair Market Value . . . . . . . . . . . . . . . . . 3
1.14. Final Value . . . . . . . . . . . . . . . . . . . . 3
1.15. Incentive Award . . . . . . . . . . . . . . . . . . 3
1.16. Option. . . . . . . . . . . . . . . . . . . . . . . 3
1.17. Participant . . . . . . . . . . . . . . . . . . . . 3
1.18. Plan. . . . . . . . . . . . . . . . . . . . . . . . 4
1.19. Rights Agreement. . . . . . . . . . . . . . . . . . 4
1.20. STAR. . . . . . . . . . . . . . . . . . . . . . . . 4
1.21. Stock Award . . . . . . . . . . . . . . . . . . . . 4
1.22. Unit. . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE II PURPOSES
ARTICLE III ADMINISTRATION
ARTICLE IV ELIGIBILITY
ARTICLE V STOCK SUBJECT TO PLAN
5.01. Shares Issued . . . . . . . . . . . . . . . . . . . 7
5.02. Aggregate Limit . . . . . . . . . . . . . . . . . . 7
5.03. Reallocation of Shares. . . . . . . . . . . . . . . 8
ARTICLE VI OPTIONS
6.01. Award . . . . . . . . . . . . . . . . . . . . . . . 8
6.02. Option Price. . . . . . . . . . . . . . . . . . . . 8
6.03. Maximum Option Period . . . . . . . . . . . . . . . 9
6.04. Nontransferability. . . . . . . . . . . . . . . . . 9
6.05. Employee Status . . . . . . . . . . . . . . . . . . 9
6.06. Merger, Dissolution, etc. . . . . . . . . . . . . . 10
6.07. Exercise. . . . . . . . . . . . . . . . . . . . . . 10
6.08. Payment . . . . . . . . . . . . . . . . . . . . . . 10
6.09. Shareholder Rights. . . . . . . . . . . . . . . . . 11
6.10. Disposition of Stock. . . . . . . . . . . . . . . . 11
ARTICLE VII STARS
7.01. Award . . . . . . . . . . . . . . . . . . . . . . . 11
7.02. STAR Period.. . . . . . . . . . . . . . . . . . . . 11
7.03. Nontransferability. . . . . . . . . . . . . . . . . 12
7.04. Employee Status.. . . . . . . . . . . . . . . . . . 12
7.05. Change in Control.. . . . . . . . . . . . . . . . . 12
7.06. Settlement. . . . . . . . . . . . . . . . . . . . . 12
7.07. Shareholder Rights. . . . . . . . . . . . . . . . . 12
ARTICLE VIII STOCK AWARDS
8.01. Award.. . . . . . . . . . . . . . . . . . . . . . . 13
8.02. Vesting.. . . . . . . . . . . . . . . . . . . . . . 13
8.03. Performance Objectives. . . . . . . . . . . . . . . 13
8.04. Employee Status.. . . . . . . . . . . . . . . . . . 14
8.05. Change in Control.. . . . . . . . . . . . . . . . . 14
8.06. Shareholder Rights. . . . . . . . . . . . . . . . . 14
ARTICLE IX INCENTIVE AWARDS
9.01. Award.. . . . . . . . . . . . . . . . . . . . . . . 15
9.02. Terms and Conditions. . . . . . . . . . . . . . . . 15
ARTICLE X ADJUSTMENT UPON CHANGE IN COMMON STOCK
ARTICLE XI COMPLIANCE WITH LAW AND
APPROVAL OF REGULATORY BODIES
ARTICLE XII GENERAL PROVISIONS
12.01. Effect on Employment. . . . . . . . . . . . . . . . 18
12.02. Unfunded Plan.. . . . . . . . . . . . . . . . . . . 18
12.03. Rules of Construction.. . . . . . . . . . . . . . . 18
12.04. Limitation on Awards. . . . . . . . . . . . . . . . 19
ARTICLE XIII AMENDMENT
ARTICLE XIV DURATION OF PLAN
ARTICLE XV EFFECTIVE DATE OF PLAN
<PAGE>
LOWE'S COMPANIES, INC.
1994 INCENTIVE PLAN
ARTICLE I
DEFINITIONS
1.01. Administrator means the Committee and any delegate of the
Committee that is appointed in accordance with Article III.
1.02. Affiliate means any "subsidiary" or "parent" corporation
(within the meaning of Section 424 of the Code) of the Company.
1.03. Agreement means a written agreement (including any
amendment or supplement thereto) between the Company and a Participant
specifying the terms and conditions of a Stock Award, an Incentive Award or
an Option or STAR granted to such Participant.
1.04. Beginning Value means, with respect to a STAR Unit, the
Fair Market Value of one share of Common Stock on the first day of the STAR
period.
1.05. Board means the Board of Directors of the Company.
1.06. Change in Control means that following a Stock Acquisition
Date, directly or indirectly, (i) the Company shall consolidate with, or
merge with and into, any other Person (other than a Subsidiary of the
Company in a transaction that complies with Section 11(n) of the Rights
Agreement), and the Company shall not be the continuing or surviving
corporation of such consolidation or merger, (ii) any Person (other than a
Subsidiary of the Company in a transaction that complies with Section 11(n)
of the Rights Agreement) shall consolidate with, or merge with or into, the
Company, and the Company shall be the continuing or surviving corporation
such consolidation or merger and, in connection with such consolidation or
merger, all or part of the outstanding shares of Common Stock shall be
changed into or exchanged for stock or other securities of any other Person
or cash or any other property, (iii) the Company shall be a party to a
statutory share exchange with any other Person (other than a Subsidiary of
the Company in a transaction that complies with Section 11(n) of the Rights
Agreement) after which the Company is a Subsidiary of any other Person, or
(iv) the Company shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any Person or Persons (other than the Company or any
Subsidiary of the Company in one or more transactions each of which
complies with Section 11(n) of the Rights Agreement.) For purposes of this
Plan, the terms "Stock Acquisition Date," "Person," and "Subsidiary" shall
have the same meaning as assigned to such terms in the Rights Agreement.
1.07. Code means the Internal Revenue Code of 1986, and any
amendments thereto.
1.08. Committee means the Compensation Committee of the Board.
1.09. Common Stock means the common stock of the Company.
1.10. Company means Lowe's Companies, Inc.
1.11. Control Change Date means the date on which a Change in
Control occurs. If a Change in Control occurs on account of a series of
transactions, the "Control Change Date" is the date of the last of such
transactions.
1.12. Exchange Act means the Securities Exchange Act of 1934, as
amended and as in effect on the date of this Agreement.
1.13. Fair Market Value means, on any given date, the closing
price of a share of Common Stock as reported on the New York Stock Exchange
composite tape on such date, or if the Common Stock was not traded on the
New York Stock Exchange on such day, then on the next preceding day that
the Common Stock was traded on such exchange, all as reported by such
source as the Administrator may select.
1.14. Final Value means the average Fair Market Value during the
final month of the term of a STAR award.
1.15. Incentive Award means an award which, subject to such terms
and conditions as may be prescribed by the Administrator, entitles the
Participant to receive a cash payment from the Company or an Affiliate.
1.16. Option means a stock option that entitles the holder to
purchase from the Company a stated number of shares of Common Stock at the
price set forth in an Agreement.
1.17. Participant means an employee of the Company or an
Affiliate, including an employee who is a member of the Board, who
satisfies the requirements of Article IV and is selected by the
Administrator to receive a Stock Award, an Option, a STAR, an Incentive
Award or a combination thereof.
1.18. Plan means the Lowe's Companies, Inc. 1994 Incentive Plan.
1.19. Rights Agreement means the Rights Agreement between the
Company and Wachovia Bank and Trust Company dated as of September 9, 1988.
1.20. STAR means a stock appreciation right, denominated in
Units, that in accordance with the terms of an Agreement entitles the
holder to receive, with respect to each Unit the excess of the Final Value
over the Beginning Value. Notwithstanding the preceding sentence, the
Administrator may prescribe a limit on the amount payable under a STAR.
1.21. Stock Award means Common Stock awarded to a Participant
under Article IX.
1.22. Unit means the increment that is used for determining the
amount payable under a STAR award and shall, for this purpose, be
comparable to a share of Common Stock.
ARTICLE II
PURPOSES
The Plan is intended to assist the Company and its Affiliates in
recruiting and retaining key employees by enabling such employees to
participate in the future success of the Company and its Affiliates and to
associate their interests with those of the Company and its shareholders.
The Plan is intended to permit the grant of Stock Awards, STARs, the grant
of both Options qualifying under Section 422 of the Code ("incentive stock
options") and Options not so qualifying, and the grant of Incentive Awards.
The proceeds received by the Company from the sale of Common Stock pursuant
to this Plan shall be used for general corporate purposes.
ARTICLE III
ADMINISTRATION
The Plan shall be administered by the Administrator. The
Administrator shall have authority to grant Stock Awards, Incentive Awards,
Options and STARs upon such terms (not inconsistent with the provisions of
this Plan) as the Administrator may consider appropriate. Such terms may
include conditions (in addition to those contained in this Plan) on the
exercisability of all or any part of an Option or STAR or on the
transferability or forfeitability of a Stock Award or Incentive Award,
including by way of example and not of limitation, conditions on which
Participants may or may be required to defer receipt of benefits under the
Plan, requirements that the Participant complete a specified period of
employment with the Company or an Affiliate, that the Company achieve a
specified level of financial performance or that the Company achieve a
specified level of financial return. Notwithstanding any such conditions,
the Administrator may, in its discretion, accelerate the time at which any
Option may be exercised, or the time at which a Stock Award may become
transferable or nonforfeitable or the time at which a STAR or Incentive
Award may be settled. In addition, the Administrator shall have complete
authority to interpret all provisions of this Plan; to prescribe the form
of Agreements; to adopt, amend, and rescind rules and regulations
pertaining to the administration of the Plan; and to make all other
determinations necessary or advisable for the administration of this Plan.
The express grant in the Plan of any specific power to the Administrator
shall not be construed as limiting any power or authority of the
Administrator. Any decision made, or action taken, by the Administrator or
in connection with the administration of this Plan shall be final and
conclusive. Neither the Administrator nor any member of the Committee
shall be liable for any act done in good faith with respect to this Plan or
any Agreement, Option, STAR, Stock Award or Incentive Award. All expenses
of administering this Plan shall be borne by the Company.
The Committee, in its discretion, may delegate to one or more officers
of the Company all or part of the Committee's authority and duties with
respect to grants and awards to individuals who are not subject to the
reporting and other provisions of Section 16 of the Exchange Act. The
Committee may revoke or amend the terms of a delegation at any time but
such action shall not invalidate any prior actions of the Committee's
delegate or delegates that were consistent with the terms of the Plan.
ARTICLE IV
ELIGIBILITY
Any employee of the Company or an Affiliate (including a corporation
that becomes an Affiliate after the adoption of this Plan) is eligible to
participate in this Plan if the Administrator, in its sole discretion,
determines that such person has contributed significantly or can be
expected to contribute significantly to the profits or growth of the
Company or an Affiliate. Directors of the Company who are employees of the
Company or an Affiliate may be selected to participate in this Plan. A
member of the Committee may not participate in this Plan during the time
that his participation would prevent the Committee from being
"disinterested" for purposes of Securities and Exchange Commission Rule
16b-3 as in effect from time to time.
ARTICLE V
STOCK SUBJECT TO PLAN
5.01. Shares Issued. Upon the award of shares of Common Stock
pursuant to a Stock Award the Company may issue shares of Common Stock from
its authorized but unissued Common Stock. Upon the exercise of any Option
the Company may deliver to the Participant (or the Participant's broker if
the Participant so directs), shares of Common Stock from its authorized but
unissued Common Stock.
5.02. Aggregate Limit. The maximum aggregate number of shares of
Common Stock that may be issued under this Plan (including shares of Common
Stock issued under the Plan as in effect before January 31, 1994 and after
giving effect to the March 16, 1994 two-for-one stock split) is 5,000,000
shares, subject to adjustment as provided in Article X such that 2,423,640
shares of Common Stock will be available for issuance under Options and
Stock Awards granted on and after January 31, 1994. Subject to the
limitation set forth in the preceding sentence, the maximum aggregate
number of shares that may be issued under this Plan as Stock Awards is
1,000,000 shares, subject to adjustment as provided in Article X.
5.03. Reallocation of Shares. If an Option is terminated, in
whole or in part, for any reason other than its exercise, the number of
shares of Common Stock allocated to the Option or portion thereof may be
reallocated to other Options and Stock Awards to be granted under this
Plan.
ARTICLE VI
OPTIONS
6.01. Award. In accordance with the provisions of Article IV,
the Administrator will designate each individual to whom an Option is to be
granted and will specify the number of shares of Common Stock covered by
such awards; provided, however, that no individual may be granted Options
in any calendar year covering more than 40,000 shares of Common Stock.
6.02. Option Price. The price per share for Common Stock
purchased on the exercise of an Option shall be determined by the
Administrator on the date of grant; provided, however, that the price per
share for Common Stock purchased on the exercise of any Option that is an
incentive stock option shall not be less than the Fair Market Value on the
date the Option is granted.
6.03. Maximum Option Period. The maximum period in which an
Option may be exercised shall be determined by the Administrator on the
date of grant, except that no Option that is an incentive stock option
shall be exercisable after the expiration of ten years from the date such
Option was granted. The terms of any Option that is an incentive stock
option may provide that it is exercisable for a period less than such
maximum period.
6.04. Nontransferability. Each Option granted under this Plan
shall be nontransferable except by will or by the laws of descent and
distribution. During the lifetime of the Participant to whom the Option is
granted, the Option may be exercised only by the Participant. No right or
interest of a Participant in any Option shall be liable for, or subject to,
any lien, obligation, or liability of such Participant.
6.05. Employee Status. For purposes of determining the
applicability of Section 422 of the Code (relating to incentive stock
options), or in the event that the terms of any Option provide that it may
be exercised only during employment or within a specified period of time
after termination of employment, the Administrator may decide to what
extent leaves of absence for governmental or military service, illness,
temporary disability, or other reasons shall not be deemed interruptions of
continuous employment.
6.06. Merger, Dissolution, etc. Options previously granted under
the Plan shall terminate upon the effective date of the dissolution or
liquidation of the Company, or of a reorganization, merger or consolidation
of the Company with one or more corporations in which the Company is not
the surviving corporation, or of a transfer of substantially all of the
property or more than fifty percent of the then outstanding shares of the
Company. The preceding sentence to the contrary notwithstanding, Options
shall not terminate to the extent that written provision is made for their
continuance, assumption, or substitution by a successor employer or its
parent or subsidiary in connection with a transaction described in the
preceding sentence.
6.07. Exercise. Subject to the provisions of this Plan and the
applicable Agreement, an Option may be exercised in whole at any time or in
part from time to time at such times and in compliance with such
requirements as the Administrator shall determine; provided, however, that
incentive stock options (granted under the Plan and all plans of the
Company and its Affiliates) may not be first exercisable in a calendar year
for stock having a Fair Market (determined as of the date an Option is
granted) exceeding $100,000. An Option granted under this Plan may be
exercised with respect to any number of whole shares less than the full
number for which the Option could be exercised. A partial exercise of an
Option shall not affect the right to exercise the Option from time to time
in accordance with this Plan and the applicable Agreement with respect to
the remaining shares subject to the Option.
6.08. Payment. Unless otherwise provided by the Agreement,
payment of the Option price shall be made in cash or a cash equivalent
acceptable to the Administrator. If the Agreement provides, payment of all
or part of the Option price may be made by surrendering shares of Common
Stock to the Company. If Common Stock is used to pay all or part of the
Option price, the sum of the cash and cash equivalent and the Fair Market
Value (determined as of the day preceding the date of exercise) of the
shares surrendered must not be less than the Option price of the shares for
which the Option is being exercised.
6.09. Shareholder Rights. No Participant shall have any rights
as a shareholder with respect to shares subject to his Option until the
date of exercise of such Option.
6.10. Disposition of Stock. A Participant shall notify the
Company's Chief Accounting Officer of any sale or other disposition of
Common Stock acquired pursuant to an Option that was an incentive stock
option if such sale or disposition occurs (i) within two years of the grant
of an Option or (ii) within one year of the issuance of the Common Stock to
the Participant. Such notice shall be in writing and directed to the
Secretary of the Company.
ARTICLE VII
STARS
7.01. Award. In accordance with the provisions of Article IV,
the Administrator will designate each individual to whom STARs are to be
granted and will specify the number of Units covered by such awards;
provided, however, that no individual may be granted STARs in any calendar
year covering more than 30,000 Units.
7.02. STAR Period. The term of each STAR award shall be
determined by the Administrator on the date of grant and may be one, two or
three years.
7.03. Nontransferability. Each STAR granted under this Plan
shall be nontransferable except by will or by the laws of descent and
distribution. No right or interest of a Participant in any STAR award
shall be liable for, or subject to, any lien, obligation, or liability of
such Participant.
7.04. Employee Status. If the terms of any STAR award provide
that an amount will be payable thereunder only if the Participant completes
a specified period of employment, the Administrator may decide to what
extent leaves of absence for governmental or military service, illness,
temporary disability or other reasons shall not be deemed interruptions of
continuous employment.
7.05. Change in Control. Each STAR award shall be earned in its
entirety as of a Control Change Date; provided, however, that the Final
Value of the Units covered by outstanding STAR awards shall equal the Fair
Market Value on the Control Change Date. The amount payable under
outstanding STAR awards shall be paid within thirty days of the Control
Change Date.
7.06. Settlement. The amount payable under a STAR award shall be
paid in a single sum, in cash. Except as provided in Section 7.05, the
payment shall be made within ninety days of the end of the period in which
the Final Value is determined.
7.07. Shareholder Rights. No Participant shall, as a result of
receiving a STAR award, have any rights as a shareholder of the Company or
any Affiliate.
ARTICLE VIII
STOCK AWARDS
8.01. Award. In accordance with the provisions of Article IV,
the Administrator will designate each individual to whom a Stock Award is
to be made and will specify the number of shares of Common Stock covered by
such awards; provided, however, that no Participant may receive Stock
Awards in any calendar year for more than 30,000 shares of Common Stock.
8.02. Vesting. The Administrator, on the date of the award, may
prescribe (but shall not be required to prescribe) that a Participant's
rights in the Stock Award shall be forfeitable or otherwise restricted for
a period of time set forth in the Agreement. By way of example and not of
limitation, the restrictions may postpone transferability of the shares or
may provide that the shares will be forfeited if the Participant separates
from the service of the Company and its Affiliates before the expiration of
a stated term or if the Company, the Company and its Affiliates or the
Participant fails to achieve stated objectives.
8.03. Performance Objectives. In accordance with Section 8.02,
the Administrator may prescribe that Stock Awards will become vested or
transferable or both based on objectives stated with respect to the
Company's FIFO pre-tax earnings in relation to non-cash beginning assets
(beginning assets less beginning cash and short term investments) or the
Company's attainment of earnings per share, return on assets, or Fair
Market Value objectives.
8.04. Employee Status. In the event that the terms of any Stock
Award provide that shares may become transferable and nonforfeitable
thereunder only after completion of a specified period of employment, the
Administrator may decide in each case to what extent leaves of absence for
governmental or military service, illness, temporary disability, or other
reasons shall not be deemed interruptions of continuous employment.
8.05. Change in Control. Sections 8.02 and 8.03 to the contrary
notwithstanding, after a Control Change Date each Stock Award will become
transferable and nonforfeitable.
8.06. Shareholder Rights. Prior to their forfeiture (in
accordance with the applicable Agreement and while the shares of Common
Stock granted pursuant to the Stock Award may be forfeited or are
nontransferable), a Participant will have all rights of a shareholder with
respect to a Stock Award, including the right to receive dividends and vote
the shares; provided, however, that during such period (i) a Participant
may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose
of shares of Common Stock granted pursuant to a Stock Award, (ii) the
Company shall retain custody of the certificates evidencing shares of
Common Stock granted pursuant to a Stock Award, and (iii) the Participant
will deliver to the Company a stock power, endorsed in blank, with respect
to each Stock Award. The limitations set forth in the preceding sentence
shall not apply after the shares of Common Stock granted under the Stock
Award are transferable and are no longer forfeitable.
ARTICLE IX
INCENTIVE AWARDS
9.01. Award. The Administrator shall designate Participants to
whom Incentive Awards are made for annual incentive payments. All
Incentive Awards shall be finally determined exclusively by the
Administrator under the procedures established by the Administrator;
provided, however, that no Participant may receive an Incentive Award
payment in any calendar year that exceeds 75% of the Participant's base
salary (prior to any salary reduction or deferral elections) as of February
1 of the performance year.
9.02. Terms and Conditions. The Administrator, at the time an
Incentive Award is made, shall specify the terms and conditions which
govern the award. Such terms and conditions shall prescribe that the
Incentive Award shall be earned only to the extent that the Company
achieves objectives based on the Company's FIFO pre-tax earnings. Such
terms and conditions also may include other limitations on the payment of
Incentive Awards including, by way of example and not of limitation,
requirements that the Participant complete a specified period of employment
with the Company or an Affiliate or that the Company, an Affiliate, or the
Participant attain stated objectives or goals (in addition to those
prescribed in accordance with the preceding sentence) as a prerequisite to
payment under an Incentive Award. The Administrator, at the time an
Incentive Award is made, shall also specify when amounts shall be payable
under the Incentive Award and whether amounts shall be payable in the event
of the Participant's death, disability, or retirement.
ARTICLE X
ADJUSTMENT UPON CHANGE IN COMMON STOCK
The maximum number of shares as to which Options and Stock Awards may
be granted under this Plan shall be proportionately adjusted, and the terms
of outstanding Stock Awards, Options, and STARs (including any limitation
on the maximum amount payable under a STAR award), and the per individual
limitations on the number of shares or Units for which Options, STARs, and
Stock Awards may be granted, shall be adjusted as the Committee shall
determine to be equitably required in the event that (a) the Company (i)
effects one or more stock dividends, stock split-ups, subdivisions or
consolidations of shares or (ii) engages in a transaction to which
Section 424 of the Code applies or (b) there occurs any other event which,
in the judgment of the Committee necessitates such action. Any deter-
mination made under this Article X by the Committee shall be final and
conclusive.
The issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or
property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be
made with respect to, the maximum number of shares as to which Options and
Stock Awards may be granted, the per individual limitations on the number
of shares or Units for which Options, STARs and Stock Awards may be granted
or the terms of outstanding Stock Awards, Options or STARs.
The Committee may make Stock Awards and may grant Options and STARs in
substitution for performance shares, phantom shares, stock awards, stock
options, stock appreciation rights, or similar awards held by an individual
who becomes an employee of the Company or an Affiliate in connection with a
transaction described in the first paragraph of this Article X.
Notwithstanding any provision of the Plan (other than the limitation of
Article V), the terms of such substituted Stock Awards or Option or STAR
grants shall be as the Committee, in its discretion, determines is
appropriate.
ARTICLE XI
COMPLIANCE WITH LAW AND
APPROVAL OF REGULATORY BODIES
No Option or STAR shall be exercisable, no Common Stock shall be
issued, no certificates for shares of Common Stock shall be delivered, and
no payment shall be made under this Plan except in compliance with all
applicable federal and state laws and regulations (including, without
limitation, withholding tax requirements), any listing agreement to which
the Company is a party, and the rules of all domestic stock exchanges on
which the Company's shares may be listed. The Company shall have the right
to rely on an opinion of its counsel as to such compliance. Any share
certificate issued to evidence Common Stock when a Stock Award is granted
or for which an Option is exercised may bear such legends and statements as
the Administrator may deem advisable to assure compliance with federal and
state laws and regulations. No Option shall be exercisable, no Stock Award
shall be granted, no Common Stock shall be issued, no certificate for
shares shall be delivered, and no payment shall be made under this Plan
until the Company has obtained such consent or approval as the
Administrator may deem advisable from regulatory bodies having jurisdiction
over such matters.
ARTICLE XII
GENERAL PROVISIONS
12.01. Effect on Employment. Neither the adoption of this Plan,
its operation, nor any documents describing or referring to this Plan (or
any part thereof) shall confer upon any individual any right to continue in
the employ or service of the Company or an Affiliate or in any way affect
any right and power of the Company or an Affiliate to terminate the
employment or service of any individual at any time with or without
assigning a reason therefor.
12.02. Unfunded Plan. The Plan, insofar as it provides for
grants, shall be unfunded, and the Company shall not be required to
segregate any assets that may at any time be represented by grants under
this Plan. Any liability of the Company to any person with respect to any
grant under this Plan shall be based solely upon any contractual
obligations that may be created pursuant to this Plan. No such obligation
of the Company shall be deemed to be secured by any pledge of, or other
encumbrance on, any property of the Company.
12.03. Rules of Construction. Headings are given to the articles
and sections of this Plan solely as a convenience to facilitate reference.
The reference to any statute, regulation, or other provision of law shall
be construed to refer to any amendment to or successor of such provision of
law.
12.04. Limitation on Awards. Notwithstanding any other provision
of the Plan, if any award under this Plan, either alone or together with
other payments that a Participant has the right to receive from the Company
or an Affiliate, would constitute a "parachute payment" (as defined in
section 280G of the Code), all such payments shall be reduced to the
largest amount that will result in no portion being subject to the excise
tax imposed by section 4999 of the Code.
ARTICLE XIII
AMENDMENT
The Board may amend or terminate this Plan from time to time;
provided, however, that no amendment may become effective until shareholder
approval is obtained if (i) the amendment increases the aggregate number of
shares of Common Stock that may be issued under the Plan or (ii) the
amendment changes the class of individuals eligible to become Participants.
No amendment shall, without a Participant's consent, adversely affect any
rights of such Participant under any outstanding Stock Award, Option, STAR
or Incentive Award outstanding at the time such amendment is made.
ARTICLE XIV
DURATION OF PLAN
No Stock Award, Option, STAR or Incentive Award may be granted under
this Plan after January 31, 2004. Stock Awards, Options, STARs and
Incentive Awards granted before that date shall remain valid in accordance
with their terms.
ARTICLE XV
EFFECTIVE DATE OF PLAN
Options may be granted under the Plan pursuant to action of the Board
and the Company's shareholders' approval of the Plan as in effect before
January 31, 1994. Stock Awards, STARs and Incentive Awards may be granted
under this Plan upon its adoption by the Board, provided that no Stock
Award, STAR or Incentive Award grants will be effective unless this Plan is
approved by a majority of the votes entitled to be cast by the Company's
shareholders, voting either in person or by proxy, at a duly held
shareholders' meeting within twelve months of such adoption.
Exhibits 5 and 23.1
Hunton & Williams
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219-4074
Telephone: (804) 788-8200
Facsimile: (804) 788-8218
File No.: 23797.79/.80
Direct Dial: (804) 788-8200
July 8, 1994
Board of Directors
Lowe's Companies, Inc.
P. O. Box 1111
North Wilkesboro, North Carolina 28656
Registration Statement on Form S-8
Lowe's Companies, Inc. 1994 Incentive Plan
Gentlemen:
We are acting as counsel for Lowe's Companies, Inc. (the
"Company") in connection with the registration under the
Securities Act of 1933 of 1,000,000 shares of the Common Stock,
$.50 par value per share, and attached preferred stock purchase
rights, of the Company to be offered pursuant to the Lowe's
Companies, Inc. 1994 Incentive Plan (the "Securities"). In
connection with the filing of the Registration Statement on Form
S-8 relating to the Securities, you have requested our opinion
concerning certain corporate matters.
We are of the opinion that:
1. The Company is duly organized, validly existing and in
good standing under the laws of the State of North Carolina.
2. The Securities, when sold in accordance with the Lowe's
Companies, Inc. 1994 Incentive Plan, will be legally issued,
fully paid and nonassessable.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration
Statement on Form S-8.
Very truly yours,
HUNTON & WILLIAMS
T:\lowe's\S-8\HWopin.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Lowe's Companies, Inc. on Form S-8 of our reports dated March 9, 1994, appearing
in and incorporated by reference in the Annual Report on Form 10-K of Lowe's
Companies, Inc. for the year ended January 31, 1994.
Deloitte & Touche
Charlotte, North Carolina
July 7, 1994
