<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)
---------------------------
1988 DIRECTOR STOCK OPTION 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 General Division
Common Stock, $0.01 par value 33,600 shares $27.63(1) $928,368 $281.32
- -----------------------------------------------------------------------------------------------------------------------------------
Genzyme Tissue Repair Division
Common Stock, $0.01 par value 30,000 shares $10.16(1) $304,800 $ 92.36
- -----------------------------------------------------------------------------------------------------------------------------------
Genzyme Molecular Oncology
Division Common Stock, $0.01 70,000 shares $ 5.04(2) $352,800 $106.91
par value
- -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 2
(1) Estimated solely for the purpose of determining the registration fee
and computed pursuant to Rule 457(h) and based upon the average of the
high and low sale prices on August 1, 1997 in the case of the Genzyme
General Division Common Stock ("GGD Stock"), and on August 6, 1997 in
the case of the Genzyme Tissue Repair Division Common Stock ("GTR
Stock"), each as reported by the Nasdaq National Market System.
(2) 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. Pusuant 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> 3
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 General Division Common Stock ("GGD
Stock"), Genzyme Tissue Repair Division Common Stock ("GTR Stock"), Genzyme
Molecular Oncology Division General Stock ("GMO Stock"), GGD Stock Purchase
Rights, GTR Stock Purchase Rights and 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.
3
<PAGE> 4
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 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:
4
<PAGE> 5
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act 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.
5
<PAGE> 6
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>
6
<PAGE> 7
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION PAGE NUMBER
- -------------- ----------- -----------
<S> <C> <C>
5.1 Opinion of Palmer & Dodge LLP as to the legality of 8
the securities registered hereunder.
23.1 Consent of Coopers & Lybrand L.L.P., independent 9
accountants.
23.2 Consent of Arthur Andersen LLP, independent 10
accountants to PharmaGenics, Inc.
23.3 Consent of Palmer & Dodge LLP (contained in Exhibit
5.1).
99.1 Genzyme Corporation Director Stock Option Plan, as 11
amended by the Board of Directors of Genzyme on
April 7, 1997.
</TABLE>
7
<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 33,600 shares of
Genzyme General Division Common Stock, $0.01 par value, 30,000 shares of Genzyme
Tissue Repair Division Common Stock, $0.01 par value, and 70,000 shares of
Genzyme Molecular Oncology Division Common Stock, $0.01 par value
(collectively, the "Shares"), offered pursuant to the provisions of the
Company's 1988 Director Stock Option 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
8
<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 1988 Director Stock Option 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
9
<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
10
<PAGE> 1
Exhibit 99.1
Adopted by directors on December 15, 1988
Approved by shareholders on May 18, 1989
Amended by directors on March 17, 1993
Approved by shareholders on May 21, 1993
Amended and restated by directors on August 25, 1994
Adopted by shareholders on December 12, 1994
Amended by directors on March 14, 1996
Adopted 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
Amended by directors on April 7, 1997
Adopted by shareholders on May 29, 1997
Adopted by shareholders on June 12, 1997
GENZYME CORPORATION
1988 DIRECTOR STOCK OPTION PLAN
This 1988 Director Stock Option Plan dated December 15, 1988 (the
"Plan") governs options to purchase common stock, $0.01 par value ("Common
Stock") of Genzyme Corporation (the "Company") granted on or after the date
hereof by the Company to members of the Board of Directors of the Company who
are not also officers or employees of the Company. The purpose of the Plan is to
attract and retain qualified persons to serve as Directors of the Company and to
encourage ownership of stock of the Company by such Directors so as to provide
additional incentives to promote the success of the Company.
1. ADMINISTRATION OF THE PLAN.
Grants of stock options under the Plan shall be automatic as
provided in Section 6. However, all questions of interpretation with respect to
the Plan and options granted under it shall be determined by a committee
consisting of all Directors of the Company who are not eligible to participate
in the Plan, and such determination shall be final and binding upon all persons
having an interest in the Plan.
2. PERSONS ELIGIBLE TO PARTICIPATE IN THE PLAN.
Members of the Board of Directors of the Company (the "Board")
who are not also officers or employees of the Company shall be eligible to
participate in the Plan.
3. SHARES SUBJECT TO THE PLAN.
11
<PAGE> 2
(a) The aggregate number of shares of each class of Common
Stock which may be optioned under this plan is 233,600 shares of Genzyme General
Division Common Stock ("GGD Stock"), 100,000 shares of Genzyme Tissue Repair
Division Common Stock ("GTR Stock"), and 70,000 shares of Genzyme Molecular
Oncology Division Common Stock ("GMO Stock"). A reference to a class of common
stock also means each separate series of a single class. In the event of a stock
dividend, split-up, combination or reclassification of shares, recapitalization
or other similar capital change relating to the Common Stock, the maximum
aggregate number and kind of shares or securities of the Company as to which
options may be granted under this Plan and as to which options then outstanding
shall be exercisable, and the option price of such options, shall be
appropriately adjusted by the Board (whose determination shall be conclusive) so
as to preserve the value of the option.
(b) In the event of a consolidation or merger of the Company
with another corporation where the Company's stockholders do not own a majority
in interest of the surviving or resulting corporation, or the sale or exchange
of all or substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, any deferred exercise period shall be automatically
accelerated and each holder of an outstanding option shall be entitled to
receive upon exercise and payment in accordance with the terms of the option the
same shares, securities or property as he would have been entitled to receive
upon the occurrence of such event if he had been, immediately prior to such
event, the holder of the number of shares of Common Stock purchasable under his
or her option or, if another corporation shall be the survivor, such corporation
shall substitute therefor substantially equivalent shares, securities or
property of such other corporation; provided, however, that in lieu of the
foregoing the Board may upon written notice to each holder of an outstanding
option or right provide that such option or right shall terminate on a date not
less than 20 days after the date of such notice unless theretofore exercised.
(c) Whenever options under this Plan lapse or terminate or
otherwise become unexercisable the shares of Common Stock which were subject to
such options may again be subjected to options under this Plan. The Company
shall at all times while this Plan is in force reserve such number of shares of
Common Stock as will be sufficient to satisfy the requirements of this Plan.
4. NON-STATUTORY STOCK OPTIONS
All options granted under this Plan shall be non-statutory
options not entitled to special tax treatment under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code").
5. FORM OF OPTIONS
Options granted hereunder shall be in substantially the form
of the attached Exhibit A or in such other form as the Board may from time to
time determine.
6. GRANT OF OPTIONS AND OPTION TERMS.
12
<PAGE> 3
(a) INITIAL GRANT OF GGD STOCK OPTIONS. Upon the original
adoption of this Plan by the Board of Directors of the Company, initial options
to purchase GGD Stock were automatically granted to the following Directors in
the amounts set forth opposite their respective names, giving effect to the 2:1
stock split of the GGD Stock on July 25, 1996:
<TABLE>
<CAPTION>
NAME OF DIRECTOR NUMBER OF SHARES
---------------- ----------------
<S> <C>
Constantine E. Anagnostopoulos 4,000
Charles L. Cooney 8,000
Eileen M. More 4,000
Henry R. Lewis 8,000
Douglas A. Berthiaume 4,000
</TABLE>
(b) INITIAL GRANT OF GTR STOCK OPTIONS. Upon the effective
date of the Company's acquisition of BioSurface Technology, Inc., initial
options to purchase 5,000 shares of GTR Stock were automatically granted to each
Director then in office who is not also an officer or employee of the Company.
(c) INITIAL GRANT OF GMO STOCK OPTIONS. Upon the effective
date of the Company's acquisition of PharmaGenics, Inc., initial options to
purchase 2,700 shares of GMO Stock were automatically granted to each Director
then in office who is not also an officer or employee of the Company.
(d) AUTOMATIC GRANT OF OPTIONS. At each annual meeting of the
stockholders of the Company, those Directors to be elected or re-elected at that
meeting who are eligible to receive options under the Plan shall automatically
be granted, for each year of the term of office to which they are elected,
options to purchase (i) 4,000 shares of GGD Stock, (ii) a number of shares of
GTR Stock equal to 1,000 times a fraction, the numerator of which is the Fair
Market Value of the GGD Stock and the denominator of which is the Fair Market
Value of the GTR Stock, and (iii) a number of shares of GMO Stock equal to 1,000
times a fraction, the numerator of which is the Fair Market Value of the GGD
Stock and the denominator of which is the Fair Market Value of the GMO Stock. In
addition, upon the election of an eligible Director under the Plan other than at
an annual meeting of stockholders (whether by the Board of Directors or the
stockholders and whether to fill a vacancy or otherwise), such Director shall
automatically be granted options to purchase the number of shares of GGD Stock,
GTR Stock and GMO Stock described in the preceding sentence for each year or
portion thereof of the term of office to which he or she is elected. The "Date
of Grant" for options granted under this Plan shall be (i) the date this Plan is
initially adopted by the Board of Directors for the initial options to purchase
GGD Stock, (ii) the effective date of the Company's acquisition of BioSurface
Technology, Inc. for the initial options to purchase GTR Stock, (iii) the
effective date of the Company's acquisition of PharmaGenics, Inc. for the
initial options to purchase GMO Stock and (iv) the date of election or
re-election as a Director, as the case may be, for all subsequent options. No
options shall be granted hereunder after ten years from the date on which this
Plan was initially approved and adopted by the Board of Directors. As used
herein, "Fair Market Value" for each class of the Common Stock shall mean the
last sale price for such class as reported by the National Association of
Securities Dealers Automated Quotations National Market System on the Date of
Grant of such options.
13
<PAGE> 4
(e) OPTION PRICE. The option price for each option granted
under this Plan shall equal to the Fair Market Value of the class of common
stock with respect to which the option is exercisable.
(f) TERM OF OPTION. The term of each option granted under
this Plan shall be ten years from the Date of Grant.
(g) PERIOD OF EXERCISE.
(i) Options to purchase GGD Stock initially granted
upon adoption of this Plan by the Board of Directors became exercisable with
respect to the number of shares indicated below on the date of the annual
meetings of stockholders of the Company set forth opposite the number of shares
(giving effect to the 2:1 stock split of the GGD Stock on July 25, 1996) if and
only if the option holder was a member of the Board of Directors of the Company
at the opening of business on that date:
<TABLE>
<CAPTION>
NAME OF DIRECTOR NUMBER OF SHARES ANNUAL MEETING
---------------- ---------------- --------------
<S> <C> <C>
Constantine E. Anagnostopoulos 4,000 1990
Charles L. Cooney 4,000 1989
Charles L. Cooney 4,000 1990
Eileen M. Moore 4,000 1989
Henry R. Lewis 4,000 1990
Henry R. Lewis 4,000 1991
Douglas A. Berthiaume 4,000 1989
</TABLE>
(ii) Options to purchase GTR Stock initially granted
upon the effective date of the Company's acquisition of BioSurface Technology,
Inc. were exercisable in full on their Date of Grant.
(iii) Options to purchase GMO Stock initially granted
upon the effective date of the Company's acquisition of PharmaGenics, Inc. were
exercisable in full on their Date of Grant.
(iv) Options granted under this Plan at an annual
meeting of stockholders shall become exercisable with respect to one-third of
the total number of shares of each class of Common Stock on the date of each
annual meeting of stockholders following their Date of Grant, if and only if the
option holder is a member of the Board of Directors of the Company at the
opening of business on that date (for example, if options to purchase a total of
12,000 shares of GGD Stock and 1,500 shares of GTR Stock are granted to a
Director at the 1998 annual meeting, the options will become exercisable with
respect to 4,000 shares of GGD Stock, 500 shares of GTR Stock and 500 shares of
GMO Stock at each of the 1999, 2000 and 2001 annual meetings). Directors holding
exercisable options under this Plan who cease to serve as members of the Board
of Directors of the Company may, during their lifetime, exercise the rights they
had under such options at the time they ceased being a Director for the full
unexpired term of such option. Upon the death of a Director, those entitled to
do so under the Director's will or the laws of descent and distribution shall
have the right, at any time within twelve
14
<PAGE> 5
months after the date of death, to exercise in whole or in part any rights which
were available to the Director at the time of his or her death. Options granted
under the Plan shall terminate, and no rights thereunder may be exercised, after
the expiration of the applicable exercise period. Notwithstanding the foregoing
provisions of this section, no rights under any options may be exercised after
the expiration of ten years from their Date of Grant.
(h) METHOD OF EXERCISE AND PAYMENT. Options may be exercised
only by written notice to the Company at its head office accompanied by payment
of the full option price for the shares of Stock as to which they are exercised.
The option price shall be paid in cash or by check. Upon receipt of such notice
and payment, the Company shall promptly issue and deliver to the optionee (or
other person entitled to exercise the option) a certificate or certificates for
the number of shares as to which the exercise is made.
(i) NON-TRANSFERABILITY. Options granted under this Plan
shall not be transferable by the holder thereof otherwise than by will or the
laws of descent and distribution, and shall be exercisable, during the holder's
lifetime, only by him or her.
7. LIMITATION OF RIGHTS.
(a) NO RIGHT TO CONTINUE AS A DIRECTOR. Neither the Plan, nor
the granting of an option or any other action taken pursuant to the Plan, shall
constitute an agreement or understanding, express or implied, that the Company
will retain an optionee as a Director for any period of time or at any
particular rate of compensation.
(b) NO STOCKHOLDERS' RIGHTS FOR OPTIONS. Directors shall have
no rights as a stockholder with respect to the shares covered by their options
until the date they exercise such options and pay the option price to the
Company, and no adjustment will be made for dividends or other rights for which
the record date is prior to the date such option is exercised and paid for.
8. AMENDMENT OR TERMINATION.
The Company's Board may amend or terminate this Plan at any
time, provided that (i) an increase of the aggregate number of shares of GGD
Stock, GTR Stock or GMO Stock which may be optioned under this Plan (except as
permitted by Section 2 of the Plan), (ii) material modification of the
requirements as to eligibility for participation under this Plan, and (iii) a
material increase in benefits to participants under this Plan are subject to
approval by stockholders of the Company within 12 months from the date of such
amendment by the affirmative vote of the holders of a majority of the shares of
Stock of the Company present, or represented and entitled to vote at a meeting
duly held in accordance with the laws of Massachusetts. In the event such
approval is not obtained, options granted subsequent to any such amendment shall
not be entitled to the benefit thereof, or if the amendment increases the
aggregate number of shares of the Company which may be optioned under this plan
and sufficient shares are not otherwise available under this Plan, shall be void
and without effect.
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