<PAGE> 1
As filed with the Securities and Exchange Commission on August 8, 1997
REGISTRATION NO. 333- _____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
---------------------------
GENZYME CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
MASSACHUSETTS 06-1047163
(State or other jurisdiction of incorporation) (I.R.S. Employer Identification No.)
</TABLE>
ONE KENDALL SQUARE, CAMBRIDGE, MASSACHUSETTS 02139
(Address of Principal Executive Offices)
---------------------------
DIRECTORS' DEFERRED COMPENSATION PLAN
(Full Title of the Plan)
PETER WIRTH, ESQ.
Genzyme Corporation
One Kendall Square
Cambridge, Massachusetts 02139
(617) 252-7500
(Name, address and telephone number of agent for service)
with copies to:
MAUREEN P. MANNING, ESQ.
Palmer & Dodge LLP
One Beacon Street
Boston, Massachusetts 02108
(617) 573-0100
---------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
Proposed Proposed maximum
Title of each class of securities to Amount to be maximum offering aggregate offering Amount of
be registered registered price per share price registration fee
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Genzyme Molecular Oncology
Division Common Stock, $0.01 50,000 shares $5.04(1) $252,000 $76.36
par value
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee
and computed pursuant to Rule 457(h)(1) of the Securities Act of 1933,
as amended. Pursuant to Rule 457(h)(1), the maximum aggregate offering
price of the Genzyme Molecular Oncology Division Common Stock ("GMO
Stock") offered hereby is equal to the pro forma book value of such
shares computed as of June 30, 1997.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference:
(a) The Registrant's latest annual report on Form 10-K filed pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
(b) All other reports of the registrant filed pursuant to Section 13(a)
or 15(d) of the Exchange Act since the end of the fiscal year covered by the
annual report referred to in (a) above.
(c) The description of the Genzyme Molecular Oncology Division General
Stock ("GMO Stock") and the Registrant's GMO Stock Purchase Rights contained in
the Registrant's Registration Statement on Form 8-A filed on June 18, 1997,
including any further amendment or report filed hereafter for the purpose of
updating such description.
All documents filed after the date of this Registration Statement by
the Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the Exchange
Act, prior to the filing of a post-effective amendment that indicates that all
shares of GMO Stock offered hereunder have been sold or which deregisters all
shares of GMO Stock remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of the filing of such
reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 67 of chapter 156B of the Massachusetts Business Corporation
Law grants the Registrant the power to indemnify any director, officer, employee
or agent to whatever extent permitted by the Registrant's Restated Articles of
Organization, By-Laws or a vote adopted by the holders of a majority of the
shares entitled to vote thereon, if such indemnitee acted (a) in good faith in
the reasonable belief that his action was in the best interests of the
corporation or (b) to the extent that the matter for which indemnification is
sought relates to service with respect to an employee benefit plan, in the best
interests of the participants or beneficiaries of such employee benefit plan.
Such indemnification may include payment by the Registrant of expenses incurred
in defending a civil or criminal action or proceeding in advance of the final
disposition of such action or proceeding, upon receipt of an undertaking by the
person indemnified to repay such payment if he shall be adjudicated to be not
entitled to indemnification under the statute.
Article VI of the Registrant's By-Laws provides that the Registrant
shall, to the extent legally permissible, indemnify each person who may serve or
who has served at any time as a director or officer of the corporation or of any
of its subsidiaries, or who at the request of the corporation may
2
<PAGE> 3
serve or at any time has served as a director, officer or trustee of, or in a
similar capacity with, another organization or an employee benefit plan, against
all expenses and liabilities (including counsel fees, judgments, fines, excise
taxes, penalties and amounts payable in settlements) reasonably incurred by or
imposed upon such person in connection with any threatened, pending or completed
action, suit or other proceeding, whether civil, criminal, administrative or
investigative, in which he may become involved by reason of his serving or
having served in such capacity (other than a proceeding voluntarily initiated by
such person unless he is successful on the merits, the proceeding was authorized
by the corporation or the proceeding seeks a declaratory judgment regarding his
own conduct). Such indemnification shall include payment by the Registrant of
expenses incurred in defending a civil or criminal action or proceeding in
advance of the final disposition of such action or proceeding, upon receipt of
an undertaking by the person indemnified to repay such payment if he shall be
adjudicated to be not entitled to indemnification under Article VI, which
undertaking may be accepted without regard to the financial ability of such
person to make repayment.
The indemnification provided for in Article VI is a contract right
inuring to the benefit of the directors, officers and others entitled to
indemnification. In addition, the indemnification is expressly not exclusive of
any other rights to which such director, officer or other person may be entitled
by contract or otherwise under law, and inures to the benefit of the heirs,
executors and administrators of such a person.
The Registrant also has in place agreements with certain officers and
directors which affirm the Registrant's obligation to indemnify them to the
fullest extent permitted by law and contain various procedural and other
provisions which expand the protection afforded by the Registrant's By-Laws.
Section 13(b)(1/2) of chapter 156B of the Massachusetts Business
Corporation Law provides that a corporation may, in its Articles of
Organization, eliminate the directors' personal liability to the corporation and
its stockholders for monetary damages for breaches of fiduciary duty, except in
circumstances involving (i) a breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii)
unauthorized distributions and loans to insiders, and (iv) transactions from
which the director derived an improper personal benefit. Section VI.C.5 of the
Registrant's Restated Articles of Organization provides that no director shall
be personally liable to the corporation or its stockholders for monetary damages
for any breach of fiduciary duty as a director, except to the extent that such
exculpation is not permitted under the Massachusetts Business Corporation Law as
in effect when such liability is determined.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
See Exhibit Index immediately following the signature page.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
3
<PAGE> 4
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represents 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) 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 Securities Exchange Act of 1934 that are
incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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 of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, 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 of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions referred to in Item 6
hereof, or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the 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 Act and
will be governed by the final adjudication of such issue.
4
<PAGE> 5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Cambridge, Commonwealth of Massachusetts, on this 8th
day of August, 1997.
GENZYME CORPORATION
By: /s/ David J. McLachlan
---------------------------------------
David J. McLachlan
Executive Vice President, Finance
and Chief Financial Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of Genzyme Corporation,
hereby severally constitute and appoint Henri A. Termeer, David J. McLachlan,
Evan M. Lebson and Peter Wirth, and each of them singly, our true and lawful
attorneys-in-fact, with full power to them in any and all capacities, to sign
any and all amendments to this Registration Statement on Form S-8 including any
post-effective amendments thereto), and to file the same, with exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Henri A. Termeer President, Chief Executive August 8, 1997
- ---------------------------------- Officer and Director
Henri A. Termeer
/s/ David J. McLachlan Executive Vice President, August 8, 1997
- ---------------------------------- Finance and Chief Financial
David J. McLachlan Officer
/s/ Constantine E. Anagnostopoulos Director August 8, 1997
- ----------------------------------
Constantine E. Anagnostopoulos
/s/ Douglas A. Berthiaume Director August 8, 1997
- ----------------------------------
Douglas A. Berthiaume
/s/ Henry E. Blair Director August 8, 1997
- ----------------------------------
Henry E. Blair
/s/ Robert J. Carpenter Director August 8, 1997
- ----------------------------------
Robert J. Carpenter
/s/ Charles L. Cooney Director August 8, 1997
- ----------------------------------
Charles L. Cooney
/s/ Henry R. Lewis Director August 8, 1997
- ----------------------------------
Henry R. Lewis
</TABLE>
5
<PAGE> 6
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION PAGE NUMBER
- -------------- ----------- -----------
<S> <C> <C>
5.1 Opinion of Palmer & Dodge LLP as to the legality of 7
the securities registered hereunder.
23.1 Consent of Coopers & Lybrand L.L.P., independent 8
accountants.
23.2 Consent of Arthur Andersen LLP, independent 9
accountants to PharmaGenics, Inc.
23.3 Consent of Palmer & Dodge LLP (contained in Exhibit
5.1).
99.1 Genzyme Corporation Directors' Deferred 10
Compensation Plan, as amended by the Board of
Directors of Genzyme on January 30, 1997.
</TABLE>
6
<PAGE> 1
Exhibit 5.1
Palmer & Dodge LLP
One Beacon Street
Boston, Massachusetts 02018
Telephone: (617) 573-0100 Facsimile: (617) 227-4420
August 8, 1997
Genzyme Corporation
One Kendall Square
Cambridge, Massachusetts 02139
We are rendering this opinion in connection with the registration
Statement on Form S-8 (the "Registration Statement") filed by Genzyme
Corporation (the "Company") with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"), on or
about the date hereof. The Registration Statement relates to 50,000 shares of
Genzyme Molecular Oncology Division Common Stock, $0.01 par value (the
"Shares"), offered pursuant to the provisions of the Company's Directors'
Deferred Compensation Plan (the "Plan").
We have acted as your counsel in connection with the preparation of the
Registration Statement and are familiar with the proceedings taken by the
Company in connection with authorization, issuance and sale of the Shares. We
have examined all such documents as we consider necessary to enable us to render
this opinion.
Based upon the foregoing, we are of the opinion that when issued in
accordance with the terms of the Plan, the Shares will be duly authorized,
validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as a part of the
Registration Statement and to the reference to our firm under Item 5 thereof.
Very truly yours,
/s/ Palmer & Dodge LLP
7
<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of Genzyme Corporation for its Directors' Deferred Compensation Plan of
our reports dated February 27, 1997 on our audits of the consolidated financial
statements and financial statement schedule of Genzyme Corporation, the combined
financial statements and financial statement schedule of Genzyme General
Division and the combined financial statements and financial statement schedule
of Genzyme Tissue Repair Division as of December 31, 1995 and 1996 and for each
of the three years in the period ended December 31, 1996, which reports are
included in Genzyme Corporation's 1996 Annual Report on Form 10-K.
We also consent to the incorporation by reference in this Registration Statement
on Form S-8 of Genzyme Corporation of our report dated April 7, 1997 on our
audit of the combined financial statements of Genzyme Molecular Oncology
Division as of December 31, 1995 and 1996 and for the period from December 1,
1994 (Date of Inception) through December 31, 1994, for the years ended December
31, 1995 and 1996 and cumulative for the period from December 1, 1994 (Date of
Inception) through December 31, 1996, which report is included in Genzyme
Corporation's Current Report on Form 8-K filed with the Securities and Exchange
Commission on June 30, 1997.
/s/ Coopers & Lybrand L.L.P.
Coopers & Lybrand L.L.P.
Boston, Massachusetts
August 7, 1997
8
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated March 3, 1997
relating to the financial statements of PharmaGenics, Inc. included in Genzyme
Corporation's Form 8-K dated June 18, 1997.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
Roseland, New Jersey
August 8, 1997
9
<PAGE> 1
Exhibit 99.1
Adopted by directors on March 14, 1996
Approved by shareholders on May 16, 1996
Restated to reflect 2:1 stock split of the General Stock
on July 25, 1996
Amended by directors on January 30, 1997
Approved by shareholders on June 12, 1997
GENZYME CORPORATION DIRECTORS' DEFERRED
COMPENSATION PLAN
ARTICLE I
GENERAL
1.1 ESTABLISHMENT OF PLAN. Genzyme Corporation ("Genzyme") hereby
establishes the Genzyme Directors' Deferred Compensation Plan (the "plan"),
effective as of May 16, 1996, to allow each member of the Genzyme Board of
Directors who is not also an officer or employee of Genzyme to defer receipt of
all or a portion of the cash compensation payable to him or her as a director of
Genzyme until his or her termination of service as a director or, subject to
requirements set forth in Section 3.1, such other date as may be specified by
him or her.
1.2 NO RIGHT TO CORPORATE ASSETS. This plan is unfunded and Genzyme
will not be required to set aside, segregate, or deposit any funds or assets of
any kind to meet its obligations hereunder. Nothing in this plan will give a
participant, a participant's beneficiary or any other person any equity or other
interest in the assets of Genzyme, or create a trust of any kind or a fiduciary
relationship of any kind between Genzyme and any such person. Any rights that a
participant, beneficiary or other person may have under this plan will be solely
those of a general unsecured creditor of Genzyme.
1.3 LIMITATION ON RIGHTS CREATED BY PLAN. Nothing in this plan will
give a participant any right to continue as a director of Genzyme.
1.4 NONALIENATION OF BENEFITS. The rights and benefits of a
participant in this plan are personal to the participant. No interest, right or
claim under this plan and no distribution therefrom will be assignable,
transferable or subject to sale, mortgage, pledge, hypothecation, anticipation,
garnishment, attachment, execution or levy, except by designation of
beneficiaries as provided in Section 3.6.
1.5 BINDING EFFECT OF PLAN. This plan will be binding upon and inure
to the benefit of participants and designated beneficiaries and their heirs,
executors and administrators, and to the benefit of Genzyme and its assigns and
successors in interest.
1.6 ADMINISTRATION. This plan will be administered by the Clerk of
Genzyme who will have sole responsibility for its interpretation.
1.7 INTERPRETATION. This plan will be construed, enforced and
administered according to the laws of the Commonwealth of Massachusetts.
10
<PAGE> 2
ARTICLE II
DEFERRAL OF COMPENSATION
2.1 DEFERRAL AGREEMENT. Any active member of the Board of Directors
of Genzyme who is not an officer or employee of Genzyme or its subsidiaries (an
"outside director") is eligible to participate in this plan. An outside director
may participate in the plan by executing an agreement before the first day of
any calendar quarter in which such agreement will take effect authorizing
Genzyme to defer all or a portion of his or her compensation as director (the
"deferral agreement"). A deferral agreement will remain in effect for each
succeeding calendar quarter unless the participant files a written revocation or
superseding deferral agreement with the Clerk. A deferral agreement for any
particular quarter is irrevocable after the last day of the immediately
preceding calendar quarter.
2.2 AMOUNT OF DEFERRAL. Each participant may elect in his or her
deferral agreement to defer 25 percent, 50 percent, 75 percent or 100 percent of
the total cash compensation paid to the participant as an outside director of
Genzyme.
2.3 DEFERRAL ACCOUNT. For bookkeeping purposes only, the Clerk will
establish and maintain an account (the "deferral account") for each participant
which documents the compensation deferred by the participant, earnings credited
to the account and payments from the account. The deferral account will consist
of a subaccount for amounts earning interest, which will be denominated on a
dollar basis (the "cash account"), and a subaccount for amounts invested in
hypothetical shares of Genzyme General Division Common Stock, $0.01 par value
("GGD Stock"), Genzyme Tissue Repair Division Common Stock, $0.01 par value
("GTR Stock") or Genzyme Molecular Oncology Division Common Stock, $0.01 par
value ("GMO Stock") which will be denominated on a share basis (the "stock
account"). A reference to a class of common stock also means each separate
series of a single class. Each participant will indicate in his or her deferral
agreement the percentage of future deferrals to be invested in the cash account
and the stock account and, for deferrals to be invested in the stock account,
the allocation of such deferrals among GGD Stock, GTR Stock and GMO Stock.
Amounts may not be transferred between the cash account and the stock account.
2.4 CASH ACCOUNT. As of the first day of each calendar quarter, the
Clerk will credit to the participant's cash account an amount equal to the
amount of compensation otherwise payable to the participant in the preceding
calendar quarter which the participant has elected to defer and invest in the
cash account. As of the last day of each calendar quarter, the Clerk will credit
interest on the balance in the cash account on that date at the rate paid on
90-day Treasury bills hypothetically purchased on the first day of such calendar
quarter. For a participant receiving installment payments, interest will be
credited on the balance from time to time remaining in the cash account until
the account has been completely paid.
2.5 STOCK ACCOUNT. As of the first day of each calendar quarter, the
Clerk will credit to the participant's stock account a number of shares of GGD
Stock, GTR Stock and/or GMO Stock, in each case equal to the amount of
compensation otherwise payable to the participant in the preceding calendar
quarter which the participant has elected to defer and invest in each such class
of common stock divided by the applicable stock price for such class of common
stock. The applicable stock price for each class shall mean the average of the
closing price of each such class of stock for all trading days during the
applicable calendar quarter as reported by the Nasdaq National Market. As of the
date of payment of any cash dividend on a class of common stock, the Clerk will
credit to the stock account a number of shares of the class of common stock upon
which such dividend was declared equal to (i) the cash dividend per share times
the number of shares of such class credited to
11
<PAGE> 3
the stock account as of the dividend record date divided by (ii) the closing
price for such class of common stock on the date of payment of the dividend. As
of the date of payment of any stock dividend on a class of common stock, the
Clerk will credit to the stock account a number of shares equal to the stock
dividend declared times the number of shares of the class of common stock upon
which such dividend was declared credited to the stock account as of the
dividend record date. In the event of any stock dividend, recapitalization,
reorganization, merger, consolidation, split-up, spin-off, exchange of shares or
similar change affecting either class of common stock, appropriate adjustment
will be made in the number and/or kind of shares credited to the stock account.
The stock account is maintained for bookkeeping purposes only. Prior to
distribution to a participant under Section 3.3 or 3.4, shares credited to the
stock account are not considered actual shares of common stock of Genzyme for
any purpose and a participant will have no rights as a stockholder with respect
to such shares. Shares will include fractional shares computed to three decimal
places.
2.6 SHARES SUBJECT TO THE PLAN. The aggregate number of shares of
class of Common Stock which may be optioned under this plan is 200,000 shares of
the GGD Stock, 70,000 shares of the GTR Stock and 50,000 shares of GMO Stock. In
the event of any stock dividend, split-up, combination or reclassification of
shares, recapitalization or similar capital change relating to the common stock,
the maximum aggregate number and kind of shares or securities of Genzyme that
may be issued under the plan shall be appropriately adjusted by the Genzyme
Board of Directors (whose determination shall be conclusive).
ARTICLE III
PAYMENT OF DEFERRED COMPENSATION
3.1 COMMENCEMENT OF PAYMENT. Each participant will elect in his or
her deferral agreement to have payments commence in the calendar year following
his or her termination of service as a director or such other calendar year as
may be specified; provided, however, that if a participant elects to have
payments commence in a calendar year other than the calendar year following his
or her termination of service as a director, the earliest calendar year that a
participant may elect to have payments commence shall be the second calendar
year following the date of such election. For example, a deferral agreement
executed in 1996 may not specify a payment commencement date earlier than 1998.
Such election will be irrevocable.
3.2 ELECTION OF FORM OF PAYMENT. Each participant will elect in his
or her deferral agreement to have his or her deferral account paid in either a
lump sum or in annual installments for a period specified by the participant,
which period may not exceed five years.
3.3 LUMP SUM PAYMENTS. A participant who elects to have his or her
deferral account paid in a lump sum will receive the lump sum payment on or
before March 1 of the year specified in the deferral agreement for commencement
of payment. The lump sum payment will consist of (a) cash in the amount credited
to his or her cash account, and (b) subject to Section 3.5, the number of shares
of GGD Stock, GTR Stock and GMO Stock credited to his or her stock account;
provided, however, that no fractional shares will be issued under the plan and
the number of shares issued will be rounded down to the nearest full share.
3.4 INSTALLMENT PAYMENTS. A participant who elects to have his or
her deferral account paid in annual installments will receive an installment
payment on or before March 1 of each year that installments are due commencing
with the year specified in his or her deferral agreement. Each
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<PAGE> 4
installment payment will consist of (a) cash in the amount credited to his or
her cash account on the date of payment divided by the number of annual
installments remaining to be paid, and (b) subject to Section 3.5, the number of
shares of GGD Stock, GTR Stock and GMO Stock, respectively, credited to his or
her stock account divided by the number of annual installments remaining to be
paid; provided, however, that no fractional shares will be issued under the plan
and the number of shares issued will be rounded down to the nearest full share.
3.5 LIMITATION ON STOCK DISTRIBUTIONS. If a participant would receive
any payment from his or her stock account before the end of the period during
which his or her transactions in Genzyme's equity securities are subject to
reporting under Section 16 of the Securities Act of 1933, such payments shall be
made in accordance with Section 3.3 or 3.4, as applicable, except that in lieu
of shares, the participant shall receive cash in an amount equal to the number
of shares of each class of common stock in his or her stock account times the
closing price for such class as of the trading day preceding the date of
distribution.
3.6 BENEFICIARIES. A participant may designate in his or her deferral
agreement a beneficiary or beneficiaries (which may be an entity other than a
natural person) to receive any payments to be made upon his or her death. A
participant may elect to have payments to beneficiaries paid in a lump sum or in
annual installments for a period not to exceed five years. At any time, and from
time to time, a participant may change or revoke his or her designation of
beneficiary or form of payment without the consent of any beneficiary. Any such
designation, change or revocation must be made in writing and filed with the
Clerk. If the participant designates more than one beneficiary, any payments to
beneficiaries will be made in equal percentages unless the participant
designates otherwise. Any portion of a participant's deferral account that is
not disposed of by designation of beneficiary upon the participant's death will
be paid to his or her estate.
3.7 PAYMENTS ON DEATH. If a participant dies before full payment of
his or her deferral account, Genzyme will make payments to the participant's
designated beneficiary or beneficiaries, or to his or her estate, of the amount
remaining in the deceased participant's deferral account. Such payments will be
in the form designated by the participant and will commence on the first day of
the calendar quarter following the death of the participant (or as soon
thereafter as practicable) and, in the case of annual installments, will be paid
on or before March 1 of each succeeding year.
3.8 HARDSHIP DISTRIBUTIONS FROM ACCOUNTS. The Clerk may, in his
discretion, distribute a portion or all of a participant's cash account in case
of the participant's financial hardship. The Clerk will determine the date of
payment of the distribution. Hardship distributions are not permitted from a
participant's stock account.
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<PAGE> 5
ARTICLE IV
AMENDMENT AND TERMINATION
4.1 AMENDMENT. Genzyme may, without the consent of any participant,
beneficiary or other person, amend the plan at any time and from time to time;
provided, however, that no amendment will reduce the amount credited to the
deferral account of any participant.
4.2 TERMINATION. Genzyme may terminate the plan at any time. Upon
termination of the plan, payments from a participant's deferral account shall be
made in the manner and at the time prescribed in Article III; provided, however,
that Genzyme may, in its discretion, distribute a participant's deferral account
in a lump sum as soon as practicable after the date the plan is terminated.
14
