Part I - Financial Information
Item 1. Financial Statements.
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Condensed Balance Sheets
(In millions)
March 31, December 31,
1994 1993
ASSETS
Cash $4.8 $3.3
Accounts receivable, net 383.4 344.9
Inventories 332.3 328.8
Other current assets 60.8 62.8
Total current assets 781.3 739.8
Investments and advances 117.8 121.1
Property, plant and equipment
(less accumulated depreciation
of $1,649.1 and $1,623.9) 870.6 885.1
Goodwill 112.6 113.8
Other assets 67.4 70.6
Total assets $1,949.7 $1,930.4
LIABILITIES AND SHAREHOLDERS' EQUITY
Short-term borrowings and current
installments of long-term debt $150.3 $121.2
Accounts payable 202.2 231.9
Other current liabilities 275.8 251.1
Total current liabilities 628.3 604.2
Long-term senior debt 324.6 323.9
Long-term subordinated debt 125.0 125.0
Other noncurrent liabilities 273.8 281.7
Shareholders' equity:
Preferred stock, par value $1 per share:
Authorized 10.0 shares.
Series A Conversion Preferred Stock
Issued 2.76 shares 2.8 2.8
ESOP Preferred Stock
Issued 1.2 shares 90.9 92.0
Guaranteed ESOP obligations (44.0) (44.0)
Common stock, par value $1 per share:
Authorized 60.0 shares.
Issued 19.1 shares 19.1 19.1
Additional paid-in capital 297.5 297.0
Cumulative translation adjustment (7.3) (9.4)
Retained earnings 239.0 238.1
Total shareholders' equity 598.0 595.6
Total liabilities and
shareholders' equity $1,949.7 $1,930.4
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The accompanying Notes to Condensed Financial Statements are an
integral part of the condensed financial statements.
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Condensed Statements of Income
(In millions, except per share amounts)
Three Months
Ended March 31,
1994 1993
Sales $604.9 $591.9
Operating expenses:
Cost of goods sold 487.5 484.1
Selling and administration 76.8 73.2
Research and development 8.5 9.3
Operating income 32.1 25.3
Interest expense 9.4 9.6
Interest and other income 1.2 2.2
Income before taxes 23.9 17.9
Income taxes 8.6 6.2
Net income 15.3 11.7
Preferred dividends 1.7 1.9
Net income available to
common shareholders $13.6 $9.8
Per share of common stock:
Primary $0.62 $0.45
Fully diluted $0.62 $0.45
Dividends $0.55 $0.55
Average common shares outstanding 19.2 19.1
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The accompanying Notes to Condensed Financial Statements are
an integral part of the condensed financial statements.
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Condensed Statements of Cash Flows
(In millions)
Three Months
Ended March 31,
1994 1993
Operating activities
Net income $15.3 $11.7
Depreciation and amortization 33.4 33.1
Changes in:
Receivables (38.6) (32.8)
Inventories (3.4) (11.7)
Other current assets 2.0 0.7
Current liabilities other than borrowings (12.7) (51.1)
Noncurrent liabilities 1.6 (5.4)
Deferred taxes (0.9) 6.7
Net operating activities (3.3) (48.8)
Investing activities
Capital expenditures (20.4) (30.4)
Proceeds from sales of businesses - 10.4
Other investments 0.3 (3.3)
Other transactions 10.6 3.6
Net investing activities (9.5) (19.7)
Financing activities
Long-term debt repayments - (0.5)
Short-term borrowings 29.1 86.4
Dividends paid (14.8) (14.8)
Net financing activities 14.3 71.1
Net increase in cash 1.5 2.6
Cash, beginning of period 3.3 3.6
Cash, end of period $4.8 $6.2
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The accompanying Notes to Condensed Financial Statements are an
integral part of the condensed financial statements.
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
1. The condensed financial statements included herein
have been prepared by the company, without audit,
pursuant to the rules and regulations of the
Securities and Exchange Commission and, in the
opinion of the company, reflect all adjustments
(consisting only of normal accruals) which are
necessary to present fairly the results for interim
periods. Certain information and footnote
disclosures normally included in financial
statements prepared in accordance with generally
accepted accounting principles have been condensed
or omitted pursuant to such rules and regulations;
however, the company believes that the disclosures
are adequate to make the information presented not
misleading. It is suggested that these condensed
financial statements be read in conjunction with
the financial statements, accounting policies and
the notes thereto and management's discussion and
analysis of financial condition and results of
operations included in the company's Annual Report
on Form 10-K for the year ended December 31, 1993.
2. Inventories are valued principally by the dollar
value last-in, first-out (LIFO) method of inventory
accounting. It is not practicable, therefore, to
separate the inventory into its components (raw
materials, work-in-process and finished products).
Inventories under the LIFO method are based on
annual determination of quantities and costs as of
the year-end; therefore, the consolidated financial
statements at March 31, 1994, reflect certain
estimates relating to inventory quantities and
costs at December 31, 1994.
3. An Employee Stock Ownership Plan (ESOP) was
established in June 1989. The ESOP purchased from
the company approximately 1.3 million shares ($100
million) of a newly-authorized 1.75 million share
series of the company's ESOP preferred stock,
financed by $60 million of notes guaranteed by the
company, and $40 million of borrowings from the
company. The company's loan to the ESOP has been
repaid in full as of December 31, 1992. Such loan
was financed by the company through a long-term
credit facility which is classified on the March
31, 1994 balance sheet as long-term debt.
At March 31, 1994 there were approximately 1.2
million shares of ESOP preferred stock outstanding
at a value of $74.50 per share. The quarterly
fixed dividend rate is $1.4925 per share. The ESOP
preferred stock is convertible by the holder into
the company's common stock on a one-for-one basis,
subject to anti-dilutive adjustments and may be
redeemed at the option of the company after July 1,
1994, or at the option of the Plan under certain
circumstances (including upon payment of
withdrawing ESOP participant accounts or if
required to meet ESOP debt payments). The ESOP
preferred stock is included in shareholders' equity
because the company intends to redeem the ESOP
preferred stock solely with shares of the company's
common stock, and has the ability to do so.
4. Primary earnings per share are computed by dividing
net income less the ESOP preferred dividend
requirement by the weighted average number of
common shares outstanding, plus an equivalent
number (one-for-one) of common shares, assuming the
conversion of the Series A Stock. Fully diluted
earnings per share reflect the dilutive effect of
stock options and assume the conversion of
outstanding ESOP preferred stock into an equivalent
number of common shares. Net income was reduced by
an additional ESOP contribution (differential
between the common and the ESOP preferred dividend
rates under an assumed conversion) necessary to
satisfy the debt service requirement.
5. In September 1993, the company entered into a new
unsecured revolving credit agreement with a group
of banks, which replaces a prior $200 million
credit agreement. This new agreement provides a
maximum borrowing of $250 million and unless
extended, expires on October 15, 1997. The company
may select various borrowing options at varying
rates.
Item 2. Management's Discussion and Analysis of FinancialCondition and
Results of Operations.
First quarter sales and net income data by industry segment
are presented below:
Three Months
Ended March 31,
(in millions) 1994 1993
Sales:
Chemicals $285.2 $280.1
Metals 179.5 176.4
Defense and Ammunition 140.2 135.4
Total $604.9 $591.9
Net Income:
Chemicals $7.8 $7.2
Metals 8.9 6.0
Defense and Ammunition 4.2 4.3
Corporate and Other (5.6) (5.8)
Total $15.3 $11.7
Although Chemicals segment sales were slightly ahead of
1993's quarter, 1994 net income increased 8% to $7.8 million
as some of the company's chemicals businesses benefited from
an improving economy. Operating results of flexible
urethanes improved significantly over 1993's level as a
result of lower manufacturing costs and the absence of a TDI
plant maintenance turnaround which occurred in 1993's first
quarter. Chlor-alkali's financial performance was adversely
affected by declining caustic soda prices. Higher
manufacturing costs and brand promotional expenses in 1994
were the main factors contributing to pool chemicals profit
decline. Electronic materials' profits were significantly
ahead of last year due to increased demand for its products
and services and lower manufacturing costs.
Metals segment sales increased slightly over 1993's level,
while net income was 48% ahead of the same period last year.
Higher volumes from increased demand, particularly in the
automotive and housing industries, as well as a strong
commercial ammunition market, contributed to the strong
profit improvement over 1993's first quarter. The 1994 sales
increase resulting from these higher volumes was offset in
part by lower metal values. In addition, losses from the
German joint venture, which was sold in October 1993,
adversely impacted this segment's 1993 net income.
Defense and Ammunition segment sales in 1994 increased
slightly from the prior year period, while net income was
marginally less than 1993's first quarter. Winchester's net
income was slightly behind last year's level as lower fees
for managing the Lake City Army Ammunition plant more than
offset the profits from higher commercial ammunition sales.
Aerospace's sales and net income were ahead of last year's
levels due to higher sales from certain Aerospace programs,
lower manufacturing costs and additional royalty income.
Lower sales of medium caliber ammunition and Ball Powder(R)
propellant were the main contributors to the 1994 decrease
in Ordnance's financial performance.
Continuing reductions in the levels of defense procurement
are currently adversely affecting the Defense and
Ammunition segment's performance and may continue to do so
in future periods. Consequently, these reductions may also
adversely affect, to a lesser extent, the company's
financial performance in future years, including its income,
liquidity, capital resources and financial condition. In
addition, changes in the strategic direction of defense
spending and the timing of defense procurement may also
adversely affect this segment and the company. The precise
impact of defense spending cutbacks will depend on the level
of cutbacks, the extent to which these cutbacks are in the
conventional ammunition area and the company's ability to
mitigate the impact of the cutbacks with new business or by
business consolidations. The company currently provides
services to the U.S. Government in facilities management and
is pursuing other business areas such as ordnance
demilitarization. In view of continuing spending cutbacks of
the Department of Defense, the historical financial
information of the Defense and Ammunition segment, and to a
lesser extent, of the company, may not be indicative of
future performance.
Additional brand promotional expenses relating to pool
chemicals, increased market development expenses to support
the expansion of the biocides product line and higher
provision for doubtful accounts contributed to the 1994
increase in selling and administration expenses. The 1994
decrease in interest and other income in 1993 was due
primarily to income earned for the removal of salt from a
leased brine cavity. The 1994 first quarter effective tax
rate of 36%, compared to 34.6% for the comparable 1993
period, reflected an increased Federal income tax rate,
which was legislated into law in 1993.
In 1994 cash flow from operations and the use of credit
facilities were used to finance the company's seasonal
working capital requirements, capital expenditures and
dividends. At March 31, 1994, the company maintained
committed credit facilities with banks of $367 million of
which $191 million was available. The company believes that
these credit facilities are adequate to satisfy its
liquidity needs for the near future. In 1994 cash flow from
operations improved significantly from 1993's level. In the
first three months of 1993 cash flow was used to
significantly reduce December 31, 1992 accounts payable
balances. The unusually high level of capital spending in
the 1992 fourth quarter and the timing of payment of
invoices relating to various purchase commitments resulted
in the increased level of accounts payable at year-end 1992
as compared to year-end 1993.
Concerning the company's investing activities in the first
quarter, capital spending of $20.4 million in 1994 was 33%
lower than 1993 due to higher level of spending in 1993 for
additional brass strip capacity and the sulfuric acid
regeneration plant. Total year capital spending, including
environmental capital spending of $10 million, is estimated
to increase 10% from 1993 mainly to support the
consolidation of some electronic materials businesses and
provide additional capacity for selected product lines.
Historically, the company has funded its environmental
capital spending through cash flow from operations and
expects to do so in the future. Investment spending in 1993
was attributed primarily to the new ethylene oxide facility
in Latin America.
During the 1993 first quarter the company sold the facility
and assets of its contract integrated circuit assembly
operation and its brake fluid and certain formulated
functional fluid product lines. These divestitures
generated proceeds of $10.4 million.
At March 31, 1994, the percent of total debt to total
capitalization (excluding the reduction in equity for the
Contributing Employee Ownership Plan) was 48.3%, up from
47.1% at year-end 1993 and 45.5% at March 31, 1993. The
increase from year-end 1993 is attributable to higher short-
term borrowings to finance seasonal working capital
requirements.
In the 1994 first quarter, the company spent approximately
$6 million for investigatory and clean-up activities
associated with former waste sites and past operations.
Spending for environmental investigatory and remedial
efforts for the full year 1994 is estimated to be $40
million, compared to $44 million in 1993. The amounts spent
were not charged to income but instead were charged to
reserves established for such costs identified and expensed
to income in prior years. Associated costs of investigatory
and remedial activities are provided for in accordance with
generally accepted accounting principles governing
probability and the ability to reasonably estimate future
costs. Charges to income for investigatory and remedial
effors were material to operating results in 1991, 1992 and
1993 and are expected to be material to net income in 1994
and future years.
Annual environmental-related cash outlays for capital
projects, site investigation and remediation, and normal
plant operations are expected to range from $90-$105 million
over the next several years. While the company does not
anticipate a material increase in the projected annual level
of its environmental-related costs, there is always the
possibility that such increases may occur in the future in
view of the uncertainties associated with environmental
exposures. Environmental exposures are difficult to assess
for numerous reasons, including the identification of new
sites, developments at sites resulting from investigatory
studies, advances in technology, changes in environmental
laws and regulations and their application, the scarcity of
reliable data pertaining to identified sites, the difficulty
in assessing the involvement and the financial capability of
other potentially responsible parties and the company's
ability to obtain contributions from other parties and the
time periods (sometimes lengthy) over which site remediation
occurs. It is possible that some of these matters (the
outcome of which is subject to various uncertainties) may be
decided unfavorably against the company.
The company's consolidated balance sheets include reserves
for future environmental expenditures to investigate and
remediate known sites amounting to $129 million at March 31,
1994 and $131 million at December 31, 1993, of which $89
million and $91 million were classified as other noncurrent
liabilities, respectively. Included in the reserve at March
31, 1994 and December 31, 1993, were liabilities anticipated
to be shared with a third party, with whom the company is
currently in litigation. Those reserves did not take into
account any discounting of future expenditures or any
consideration of insurance recoveries or advances in
technology. Environmental liabilities are reassessed
periodically to determine if environmental circumstances
have changed and/or remediation efforts and their costs can
be better estimated. As a result of these reassessments,
future charges to income may be made for additional
liabilities.
There are a variety of legal proceedings pending or
threatened against the company. It is possible that some of
these matters (the outcome of which is subject to various
uncertainties) may be decided unfavorably against the
company. Certain of these matters are discussed in Item 3,
Legal Proceedings of the 1993 Form 10-K Annual Report and in
other filings of the company with the Securities and
Exchange Commission, which filings are available upon
request from the company.
Part II - Other Information
Item 1. Legal Proceedings.
With respect to Augat, Inc. and Isotronics v. Aegis
litigation described in Item 3(f) of the Company's Annual
Report on Form 10-K for 1993, the following additional
information is provided:
On April 12, 1994, the Massachusetts Supreme Judicial
Court vacated the trial judge's decision on damages, for
which a partnership, owned by subsidiaries of Olin and Asahi
Glass Co. Ltd. of Japan, may be responsible. The majority
opinion agreed in part with the defendants that the trial
judge's calculation of damages was erroneous in several
significant respects. The case has been remanded to the
trial court for a new determination of damages.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3. By-laws as amended effective April 28, 1994.
10(a). Olin Corporation 1994 Stock Plan for Non-
Employee Directors.
10(b). Olin Senior Management Incentive Compensation
Plan.
10(c). Olin 1991 Long Term Incentive Plan (As Amended
through April 28, 1994).
11. Computation of Per Share Earnings (Unaudited).
12(a). Computation of Ratio of Earnings to Fixed
Charges (Unaudited).
12(b). Computation of Ratio of Earnings to Combined
Fixed Charges and Preferred Stock Dividends
(Unaudited).
(b) Reports on Form 8-K
Except for current report on form 8-K, dated
January 10, 1994, with respect to item 5
thereof, which was filed on January 10, 1994,
no reports on Form 8-K were filed during the
quarter ended March 31, 1994.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
OLIN CORPORATION
(Registrant)
By: J. A. Riggs
J. A. Riggs
Senior Vice President
and Chief Financial Officer
(Duly authorized signatory and
Chief Financial Officer)
Date: April 29, 1994
EXHIBIT INDEX
Exhibit
No. Description
3. By-laws as amended effective April 28, 1994.
10(a). Olin Corporation 1994 Stock Plan for Non-Employee
Directors.
10(b). Olin Senior Management Incentive Compensation Plan.
10(c). Olin 1991 Long Term Incentive Plan (As Amended
through April 28, 1994).
11. Computation of Per Share Earnings (Unaudited).
12(a). Computation of Ratio of Earnings to Fixed
Charges (Unaudited).
12(b). Computation of Ratio of Earnings
to Combined Fixed Charges and Preferred Stock
Dividends (Unaudited).
Exhibit 3
BY-LAWS
of
OLIN CORPORATION
ARTICLE I.
MEETINGS OF SHAREHOLDERS.
SECTION 1. Place of Meetings. All meetings of
the shareholders of Olin Corporation (hereinafter
called the "Corporation") shall be held at such place,
either within or without the Commonwealth of Virginia,
as may from time to time be fixed by the Board of
Directors of the Corporation (hereinafter called the
"Board").
SECTION 2. Annual Meetings. The annual meeting
of the shareholders of the Corporation for the
election of directors and for the transaction of such
other business as may properly come before the meeting
shall be held on the last Thursday in April in each
year (or, if that day shall be a legal holiday, then
on the next succeeding business day), or on such other
day and/or in such other month as may be fixed by the
Board, at such hour as may be specified in the notice
thereof.
SECTION 3. Special Meetings. A special meeting
of the shareholders for any purpose or purposes,
unless otherwise provided by law or in the Articles of
Incorporation of the Corporation as from time to time
amended (hereinafter called the "Articles"), may be
held at any time upon the call of the Board, the
Chairman of the Board, the President or the holders of
a majority of the shares of the issued and outstanding
stock of the Corporation entitled to vote at the
meeting.
SECTION 4. Notice of Meetings. Except as
otherwise provided by law or the Articles, not less
than ten nor more than sixty days notice in writing of
the place, day, hour and purpose or purposes of each
meeting of the shareholders, whether annual or
special, shall be given to each shareholder of record
of the Corporation entitled to vote at such meeting,
either by the delivery thereof to such shareholder
personally or by the mailing thereof to such
shareholder in a postage prepaid envelope addressed to
such shareholder at his address as it appears on the
stock transfer books of the Corporation; provided,
however, that in the case of a special meeting of
shareholders called by the shareholders, such notice
shall be given at least fifty days before the date of
the meeting. Notice of any meeting of shareholders
shall not be required to be given to any shareholder
who shall attend the meeting in person or by proxy,
unless attendance is for the express purpose of
objecting to the transaction of any business because
the meeting was not lawfully called or convened, or
who shall waive notice thereof in writing signed by
the shareholder before, at or after such - meeting.
Notice of any adjourned meeting need not be given,
except when expressly required by law.
SECTION 5. Quorum. Shares representing a majority
of the votes entitled to be cast on a mattter by all
classes or series which are entitled to vote thereon
and be counted together collectively, represented in
person or by proxy at any meeting of the shareholders,
shall constitute a quorum for the transaction of
business thereat with respect to such matter, unless
otherwise provided by law or the Articles. In the
absence of a quorum at any such meeting or any
adjournment or adjournments thereof, shares
representing a majority of the votes cast on the
matter of adjournment, either in person or by proxy,
may adjourn such meeting from time to time until a
quorum is obtained. At any such adjourned meeting at
which a quorum has been obtained, any business may be
transacted which might have been transacted at the
meeting as originally called.
SECTION 6. Voting. Unless otherwise provided by
law or the Articles, at each meeting of the
shareholders each shareholder entitled to vote at such
meeting shall be entitled to one vote for each share
of stock standing in his name on the books of the
Corporation upon any date fixed as hereinafter
provided, and may vote either in person or by proxy in
writing. Unless demanded by a shareholder present in
person or represented by proxy at any meeting of the
shareholders and entitled to vote thereon or so
directed by the chairman of the meeting, the vote on
any matter need not be by ballot. On a vote by
ballot, each ballot shall be signed by the shareholder
voting or his proxy, and it shall show the number of
shares voted.
SECTION 7. Judges. One or more judges or
inspectors of election for any meeting of shareholders
may be appointed by the chairman of such meeting, for
the purpose of receiving and taking charge of proxies
and ballots and deciding all questions as to the
qualification of voters, the validity of proxies and
ballots and the number of votes properly cast.
SECTION 8. Conduct of Meeting. The chairman of the
meeting at each meeting of shareholders shall have all
the powers and authority vested in presiding officers
by law or practice, without restriction, as well as
the authority to conduct an orderly meeting and to
impose reasonable limits on the amount of time taken
up in remarks by any one shareholder.
ARTICLE II.
BOARD OF DIRECTORS.
SECTION 1. Number. Classification. Term. Election.
The property, business and affairs of the Corporation
shall be managed under the direction of the Board as
from time to time constituted. The Board shall
consist of eleven directors, but the number of
directors may be increased to any number, not more
than eighteen directors, or decreased to any number,
not less than three directors, by amendment of these By-laws,
provided that any increase or decrease by more than
thirty percent of the number of directors last elected
by the shareholders may only be effected by the
shareholders. No director need be a shareholder. The
Board shall be divided into three classes, Class I,
Class II and Class III, as nearly equal in number as
possible, with the members of each class to serve for
the respective terms of office provided in the
Articles, and until their respective successors shall
have been duly elected or until death or resignation
or until removal in the manner hereinafter provided.
In case the number of directors shall be increased,
the additional directors to fill the vacancies caused
by such increase shall be elected in accordance with
the provisions of Section 4 of Article VI of these By-
laws. Any increase or decrease in the number of
directors shall be so apportioned among the classes by
the Board as to make all classes as nearly equal in
number as possible.
Subject to the rights of holders of any Preferred
Stock outstanding, nominations for the election of
directors may be made by the Board or a committee
appointed by the Board or by any shareholder entitled
to vote in the election of directors generally.
However, any shareholder entitled to vote in the
election of directors generally may nominate one or
more persons for election as directors at a meeting
only if it is a meeting of shareholders for the
purposes of electing directors and written notice of
such shareholder's intent to make such nomination or
nominations has been given, either by personal
delivery or by United States mail, postage prepaid, to
the Secretary of the Corporation not later than (i)
with respect to an election to be held at an annual
meeting of shareholders, 90 days in advance of such
meeting and (ii) with respect to an election to be
held at a special meeting of shareholders for the
election of directors, the close of business on the
seventh day following the date on which notice of such
meeting is first given to shareholders. Each such
notice shall set forth: (a) the name and address of
the shareholder who intends to make the nomination and
of the person or persons to be nominated; (b) a
representation that the shareholder is a holder of
record of shares of the Corporation entitled to vote
at such meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons
specified in the notice; (c) a description of all
arrangements or understandings between the shareholder
and each nominee and any other person or persons
(naming such person or persons) pursuant to which the
nomination or nominations are to be made by the
shareholder; (d) such other information regarding each
nominee proposed by such shareholder as would be
required to be included in a proxy statement filed
pursuant to the proxy rules of the Securities and
Exchange Commission; and (e) the consent of each
nominee to serve as a director of the Corporation if
so elected.
SECTION 2. Compensation. Each director, in
consideration of his serving as such, shall be
entitled to receive from the Corporation such amount
per annum or such fees for attendance at Board and
Committee meetings, or both, in cash or other
property, including securities of the Corporation, as
the Board shall from time to time determine, together
with reimbursements for the reasonable expenses
incurred by him in connection with the performance of
his duties. Nothing contained herein shall preclude
any director from serving the Corporation, or any
subsidiary or affiliated corporation, in any other
capacity and receiving proper compensation therefor.
If the Board adopts a resolution to that effect, any
director may elect to defer all or any part of the
annual and other fees hereinabove referred to for such
period and on such terms and conditions as shall be
permitted by such resolution.
SECTION 3. Place of Meetings. The Board may hold
its meetings at such place or places within or without
the Commonwealth of Virginia as it may from time to
time by resolution determine or as shall be specified
or fixed in the respective notices or waivers of
notice thereof.
SECTION 4. Organization Meeting. After each annual
election of directors, as soon as conveniently may be,
the newly constituted Board shall meet for the
purposes of organization. At such organization
meeting, the newly constituted Board shall elect
officers of the Corporation and transact such other
business as shall come before the meeting. Notice of
organization meetings of the Board need not be given.
Any organization meeting may be held at any other time
or place which shall be specified in a notice given as
hereinafter provided for special meetings of the
Board, or in a waiver of notice thereof signed by all
the directors.
SECTION 5. Regular Meetings. Regular meetings of
the Board may be held at such time and place as may
from time to time be specified in a resolution adopted
by the Board then in effect; and, unless otherwise
required by such resolution, or by law, notice of any
such regular meeting need not be given.
SECTION 6. Special Meetings. Special meetings of
the Board shall be held whenever called by the Chief
Executive Officer, or by the Secretary at the request
of any three directors. Notice of a special meeting
shall be mailed to each director, addressed to him at
his residence or usual place of business, not later
than the second day before the day on which such
meeting is to be held, or shall be sent addressed to
him at such place by telegraph, cable or wireless, or
be delivered personally or by telephone, not later
than the day before the day on which such meeting is
to be held. Neither the business to be transacted at,
nor the purpose of, any regular or special meeting of
the Board need be specified in the notice of such
meeting, unless required by the Articles.
SECTION 7. Quorum. At each meeting of the Board
the presence of a majority of the number of directors
fixed by these By-laws shall be necessary to
constitute a quorum. The act of a majority of the
directors present at a meeting at which a quorum shall
be present shall be the act of the Board, except as
may be otherwise provided by law or by these By-laws.
Any meeting of the Board may be adjourned by a
majority vote of the directors present at such
meeting. Notice of any adjourned meeting need not be
given.
SECTION 8. Waivers of Notice of Meetings. Anything
in these By-laws or in any resolution adopted by the
Board to the contrary notwithstanding, notice of any
meeting of the Board need not be given to any director
if such notice shall be waived in writing signed by
such director before, at or after the meeting, or if
such director shall be present at the meeting. Any
meeting of the Board shall be a legal meeting without
any notice having been given or regardless of the
giving of any notice or the adoption of any resolution
in reference thereto, if every member of the Board
shall be present thereat. Except as otherwise
provided by law or these By-laws, waivers of notice of
any meeting of the Board need not contain any
statement of the purpose of the meeting.
SECTION 9. Telephone Meetings. Members of the
Board or any committee may participate in a meeting of
the Board or such committee by means of a conference
telephone or other means of communications whereby all
directors participating may simultaneously hear each
other during the meeting, and participation by such
means shall constitute presence in person at such
meeting.
SECTION 10. Actions Without Meetings. Any action
that may be taken at a meeting of the Board or of a
committee may be taken without a meeting if a consent
in writing, setting forth the action, shall be signed,
either before or after such action, by all of the
directors or all of the members of the committee, as
the case may be. Such consent shall have the same
force and effect as a unanimous vote.
ARTICLE III.
INDEMNIFICATION. AND LIMIT ON LIABILITY
(a) Every person who is or was a director, officer
or employee of the Corporation, or who, at the request
of the Corporation, serves or has served in any such
capacity with another corporation, partnership, joint
venture, trust, employee benefit plan, or other
enterprise shall be indemnified by the
Corporation against any and all liability and
reasonable expense that may be incurred by him in
connection with or resulting from any claim, action or
proceeding (whether brought in the right of the
Corporation or any such other corporation, entity,
plan or otherwise), civil or criminal, in which he may
become involved, as a party or otherwise, by reason of
his being or having been a director, officer or
employee of the Corporation, or such other
corporation, entity or plan while serving at the
request of the Corporation, whether or not he
continues to be such at the time such liability or
expense shall have been incurred, unless such person
engaged in willful misconduct or a knowing violation
of the criminal law.
As used in this Article III: (i) the terms
"liability" and "expense" shall include, but shall not
be limited to, counsel fees and disbursements and
amounts of judgments, fines or penalties against, and
amounts paid in settlement by, a director, officer or
employee; (ii) the terms "director", "officer" and
"employee," unless the context otherwise requires,
include the estate or personal representative of any
such person; (iii) a person is considered to be
serving an employee benefit plan as a director,
officer or employee of the plan at the Corporation's
request if his duties to the Corporation also impose
duties on, or otherwise involve services by, him to
the plan or, in connection with the plan, to
participants in or beneficiaries of the plan; (iv) the
term "occurrence" means any act or failure to act,
actual or alleged, giving rise to a claim, action or
proceeding; and (v) service as a trustee or as a
member of a management or similar committee of a
partnership or joint venture shall be considered
service as a director, officer or employee of the
trust, partnership or joint venture.
The termination of any claim, action or proceeding,
civil or criminal, by judgment, settlement, conviction
or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that a director,
officer or employee did not meet the standards of
conduct set forth in this paragraph (a). The burden
of proof shall be on the Corporation to establish, by
a preponderance of the evidence, that the relevant
standards of conduct set forth in this paragraph (a)
have not been met.
(b) Any indemnification under paragraph (a) of this
Article shall be made unless (i) the Board, acting by
a majority vote of those directors who were directors
at the time of the occurrence giving rise to the
claim, action or proceeding involved and who are not
at the time parties to such claim, action or
proceeding (provided there are at least five such
directors), finds that the director, officer or
employee has not met the relevant standards of conduct
set forth in such paragraph (a), or (ii) if there are
not at least five such directors, the Corporation's
principal Virginia legal counsel, as last designated
by the Board as such prior to the time of the occurrence
giving rise to the claim, action or proceeding
involved, or in the event for any reason such Virginia
counsel is unwilling to so serve, then Virginia legal
counsel mutually acceptable to the Corporation and the
person seeking indemnification, deliver to the
Corporation their written advice that, in their
opinion, such standards have not been met.
(c) Expenses incurred with respect to any claim,
action or proceeding of the character described in
paragraph (a) shall, except as otherwise set forth in
this paragraph (c), be advanced by the Corporation
prior to the final disposition thereof upon receipt of
an undertaking by or on behalf of the recipient to
repay such amount if it is ultimately determined that
he is not entitled to indemnification under this
Article III. No security shall be required for such
undertaking and such undertaking shall be accepted
without reference to the recipient's financial ability
to make repayment. Notwithstanding the foregoing, the
Corporation may refrain from, or suspend, payment of
expenses in advance if at any time before delivery of
the final finding described in paragraph (b), the
Board or Virginia legal counsel, as the case may be,
acting in accordance with the procedures set forth in
paragraph (b), find by a preponderance of the evidence
then available that the officer, director or employee
has not met the relevant standards of conduct set
forth in paragraph (a).
(d) No amendment or repeal of this Article III
shall adversely affect or deny to any director,
officer or employee the rights of indemnification
provided in this Article III with respect to any
liability or expense arising out of a claim, action or
proceeding based in whole or substantial part on an
occurrence the inception of which takes place before
or while this Article III, as adopted by the
shareholders of the Corporation at the 1986 Annual
Meeting of the Corporation, is in effect. The
provisions of this paragraph (d) shall apply to any
such claim, action or proceeding whenever commenced,
including any such claim, action or proceeding
commenced after any amendment or repeal to this
Article III.
(e) The rights of indemnification provided in this
Article III shall be in addition to any rights to
which any such director, officer or employee may
otherwise be entitled by contraction or as a matter of
law.
(f) In any proceeding brought by or in the right of
the Corporation or brought by or on behalf of
shareholders of the Corporation, no director or
officer of the Corporation shall be liable to the
Corporation or its shareholders for monetary damages
with respect to any transaction, occurrence or course
of conduct, whether prior or subsequent to the
effective date of this Article lll, except for
liability resulting from such person's having engaged
in willful misconduct or a knowing violation of the
criminal law or any federal or state securities law.
(g) An amendment to this Article iii shall be
approved only by a majority of the votes entitled to
be cast by each voting group entitled to vote thereon.
ARTICLE IV.
COMMITTEES.
SECTION 1. Executive and Finance Committee. The
Board may, by resolution or resolutions adopted by a
majority of the number of directors fixed by these By-
laws, appoint two or more directors to constitute an
Executive and Finance Committee, each member of which
shall serve as such during the pleasure of the Board,
and may designate for such Committee a Chairman, who
shall continue as such during the pleasure of the
Board.
All completed action by the Executive and Finance
Committee shall be reported to the Board at its
meeting next succeeding such action or at its meeting
held in the month following the taking of such action,
and shall be subject to revision or alteration by the
Board; provided, that no acts or rights of third
parties shall be affected by any such revision or
alteration.
The Executive and Finance Committee shall fix its
own rules of procedure and shall meet where and as
provided by such rules or by resolution of the Board.
At all meetings of the Executive and Finance
Committee, a majority of the full number of members of
such Committee shall constitute a quorum, and in every
case the affirmative vote of a majority of members
present at any meeting of the Executive and Finance
Committee at which a quorum is present shall be
necessary for the adoption of any resolution.
During the intervals between the meetings of the
Board, the Executive and Finance Committee shall
possess and may exercise all the power and authority
of the Board (including, without limitation, all the
power and authority of the Board in the management,
control and direction of the financial affairs of the
Corporation) except with respect to those matters
reserved to the Board by Virginia law, in such manner
as the Executive and Finance Committee shall deem best
for the interests of the Corporation, in all cases in
which specific directions shall not have been given by
the Board.
SECTION 2. Other Committees. To the extent
permitted by law, the Board may from time to time by
resolution adopted by a majority of the number of
directors fixed by these By-laws create such other
committees of directors, officers, employees or other
persons designated by it as the Board shall deem
advisable and with such limited authority, functions
and duties as the Board shall by resolution prescribe.
The Board shall have the power to change the members
of any such committee at any time, to fill vacancies,
and to discharge any such committee, either with or
without cause, at any time.
ARTICLE V.
OFFICERS.
SECTION 1. Number. Term. Election. The officers of
the Corporation shall be a Chief Executive Officer, a
Chairman of the Board, a President, one or more Vice
Presidents, a Treasurer, a Controller and a Secretary.
The Board may appoint such other officers and such
assistant officers and agents with such powers and
duties as the Board may find necessary or convenient
to carry on the business of the Corporation. Such
officers and assistant officers shall serve until
their successors shall be chosen, or as otherwise
provided in these By-laws. Any two or more offices may
be held by the same person.
SECTION 2. Chief Executive Officer. The Chief
Executive Officer shall, subject to the control of the
Board and the Executive and Finance Committee, have
full authority and responsibility for directing the
conduct of the business, affairs and operations of the
Corporation. In addition to acting as Chief Executive
Officer of the Corporation, he shall perform such
other duties and exercise such other powers as may
from time to time be prescribed by the Board and shall
see that all orders and resolutions of the Board and
the Executive and Finance Committee are carried into
effect. In the event of the inability of the Chief
Executive Officer to act, the Board will designate an
officer of the Corporation to perform the duties of
that office.
SECTION 3. Chairman of the Board. The Chairman of
the Board shall preside at all meetings of the Board
and of the shareholders and, in the absence of the
Chairman of the Executive and Finance Committee, at
all meetings of the Executive and Finance Committee.
He shall perform such other duties and exercise such
other powers as may from time to time be prescribed by
the Board or, if he shall not be the Chief Executive
Officer, by the Chief Executive Officer.
SECTION 4. President. The President shall have
such powers and perform such duties as may from time
to time be prescribed by the Board or, if he shall not
be the Chief Executive Officer, by the Chief Executive
Officer.
SECTION 5. Vice Presidents. Each Vice President
shall have such powers and perform such duties as may
from time to time be prescribed by the Board, the
Chief Executive Officer or any officer to whom the
Chief Executive Officer may have delegated such
authority.
SECTION 6. Treasurer. The Treasurer shall have the
general care and custody of the funds and securities
of the Corporation. He shall perform such other duties
and exercise such other powers as may from time to
time be prescribed by the Board, the Chief Executive
Officer or any officer to whom the Chief Executive
Officer may have delegated such authority. If the
Board shall so determine, he shall give a bond for the
faithful performance of his duties, in such sum as the
Board may determine to be proper, the expense of which
shall be borne by the Corporation. To such extent as
the Board shall deem proper, the duties of the
Treasurer may be performed by one or more assistants,
to be appointed by the Board.
SECTION 7. Controller. The Controller shall be the
accounting officer of the Corporation. He shall keep
full and accurate accounts of all assets, liabilities,
receipts and disbursements and other transactions of
the Corporation and cause regular audits of the books
and records of the Corporation to be made. He shall
also perform such other duties and exercise such other
powers as may from time to time be prescribed by the
Board, the Chief Executive Officer or any officer to
whom the Chief Executive Officer may have delegated
such authority. If the Board shall so determine, he
shall give a bond for the faithful performance of his
duties, in such sum as the Board may determine to be
proper, the expense of which shall be borne by the
Corporation. To such extent as the Board shall deem
proper, the duties of the Controller may be performed
by one or more assistants, to be appointed by the
Board.
SECTION 8. Secretary. The Secretary shall keep the
minutes of meetings of shareholders, of the Board,
and, when requested, of Committees of the Board; and
he shall attend to the giving and serving of notices
of all meetings thereof. He shall keep or cause to be
kept such stock and other books, showing the names of
the shareholders of the Corporation, and all other
particulars regarding them, as may be required by law.
He shall also perform such other duties and exercise
such other powers as may from time to time be
prescribed by the Board, the Chief Executive Officer
or any officer to whom the Chief Executive Officer may
have delegated such authority. To such extent as the
Board shall deem proper, the duties of the Secretary
may be performed by one or more assistants, to be
appointed by the Board.
ARTICLE VI.
REMOVALS, RESIGNATIONS AND VACANCIES
SECTION 1. Removal of Directors. Any director may
be removed at any time but only with cause, by the
affirmative vote of the holders of record of a
majority of the shares of the Corporation entitled to
vote on the election of directors, given at a special
meeting of the shareholders called expressly for the
purpose.
SECTION 2. Removal of Officers. Any officer,
assistant officer or agent of the Corporation may be
removed at any time, either with or without cause, by
the Board in its absolute discretion. Any such removal
shall be without prejudice to the recovery of damages
for breach of the contract rights, if any, of the
officer, assistant officer or agent removed. Election
or appointment of an officer, assistant officer or
agent shall not of itself create contract rights.
SECTION 3. Resignation. Any director, officer or
assistant officer of the Corporation may resign as
such at any time by giving written notice of his
resignation to the Board, the Chief Executive Officer
or the Secretary of the Corporation. Such resignation
shall take effect at the time specified therein or, if
no time is specified therein, at the time of delivery
thereof, and, unless otherwise specified therein, the
acceptance of such resignation shall not be necessary
to make it effective.
SECTION 4. Vacancies. Any vacancy in the Board
caused by death, resignation, disqualification,
removal, an increase in the number of directors, or
any other cause, may be filled (a) by the holders of
shares of the Corporation entitled to vote on the
election of directors, but only at an annual meeting
of shareholders, or (b) by the affirmative vote of a
majority of the remaining directors though less than a
quorum of the Board at any regular or special meeting
thereof. Each director so elected by the Board shall
hold office until the next annual election of
directors, and each director so elected by the
shareholders shall hold office for a term expiring at
the annual meeting of shareholders at which the term
of the class to which he has been elected expires,
and, in each case, until his successor shall be
elected, or until his death, or until he shall resign,
or until he shall have been removed in the manner
hereinabove provided. Any vacancy in the office of
any officer or assistant officer caused by death,
resignation, removal or any other cause, may be filled
by the Board for the unexpired portion of the term.
ARTICLE VII.
CONTRACTS, LOANS, CHECKS, DRAFTS, DEPOSITS, ETC.
SECTION 1. Execution of Contracts. Except as
otherwise provided by law or by these By-laws, the
Board (i) may authorize any officer, employee or agent
of the Corporation to execute and deliver any
contract, agreement or other instrument in writing in
the name and on behalf of the Corporation, and (ii)
may authorize any officer, employee or agent of the
Corporation so authorized by the Board to delegate
such authority by written instrument to other
officers, employees or agents of the Corporation. Any
such authorization by the Board may be general or
specific and shall be subject to such limitations and
restrictions as may be imposed by the Board. Any such
delegation of authority by an officer, employee or
agent may be general or specific, may authorize re-
delegation, and shall be subject to such limitations
and restrictions as may be imposed in the written
instrument of delegation by the person making such
delegation.
SECTION 2. Loans. No loans shall be contracted on
behalf of the Corporation and no negotiable paper
shall be issued in its name unless authorized by the
Board. When authorized by the Board, any officer,
employee or agent of the Corporation may effect loans
and advances at any time for the Corporation from any
bank, trust company or other institution, or from any
firm, corporation or individual, and for such loans
and advances may make, execute and deliver promissory
notes, bonds or other certificates or evidences of
indebtedness of the Corporation and when so authorized
may pledge, hypothecate or transfer any securities or
other property of the Corporation as security for any
such loans or advances. Such authority may be general
or confined to specific instances.
SECTION 3. Checks. Drafts. etc. All checks, drafts
and other orders for the payment of money out of the
funds of the Corporation and all notes or other
evidences of indebtedness of the Corporation shall be
signed on behalf of the Corporation in such manner as
shall from time to time be determined by the Board.
SECTION 4. Deposits. All funds of the Corporation
not otherwise employed shall be deposited from time to
time to the credit of the Corporation in such banks,
trust companies or other depositaries as the Board may
select or as may be selected by the Treasurer or any
other officer, employee or agent of the Corporation to
whom such power may from time to time be delegated by
the Board.
SECTION 5. Voting of Securities. Unless otherwise
provided by the Board, the Chief Executive Officer may
from time to time appoint an attorney or attorneys, or
agent or agents of the Corporation, in the name and on
behalf of the Corporation, to cast the votes which the
Corporation may be entitled to cast as the holder of
stock or other securities in any other corporation,
any of whose stock or other securities may be held by
the Corporation, at meetings of the holders of the
stock or other securities of such other corporation,
or to consent in writing, in the name of the
Corporation as such holder, to any action by such
other corporation, and may instruct the person or
persons so appointed as to the manner of casting such
votes or giving such consent, and may execute or cause
to be executed in the name and on behalf of the
Corporation and under its corporate seal, or
otherwise, all such written proxies or other
instruments as such officer may deem necessary or
proper in the premises.
ARTICLE VIII.
CAPITAL STOCK.
SECTION 1. Certificates. Every shareholder shall
be entitled to a certificate, or certificates, in such
form as shall be approved by the Board, signed by the
Chairman of the Board, the President or a Vice
President and the Secretary or an Assistant Secretary
or the Treasurer or an Assistant Treasurer or any
other officer authorized by these By-laws or a
resolution of the Board, certifying the number of
shares owned by him in the Corporation. Any such
certificate may, but need not, bear the seal of the
Corporation or a facsimile thereof. If any such
certificate is countersigned by a transfer agent or
registered by a registrar other than the Corporation
or an employee of the Corporation, the signatures of
any of the officers above specified upon such
certificate may be facsimiles. In case any such
officer who shall have signed or whose facsimile
signature shall have been placed upon such certificate
shall have ceased to be such before such certificate
is issued, it may be issued by the Corporation with
the same effect as if such officer had not ceased to
be such at the date of its issue.
SECTION 2. Transfers. Shares of stock of the
Corporation shall be transferable on the stock books
of the Corporation by the holder in person or by his
attorney thereunto authorized by power of attorney
duly executed and filed with the Secretary or the
transfer agent, but, except as hereinafter provided in
the case of loss, destruction or mutilation of
certificates, no transfer of stock shall be entered
until the previous certificate, if any, given for the
same shall have been surrendered and cancelled.
Except as otherwise provided by law, no transfer of
shares shall be valid as against the Corporation,
its shareholders or creditors, for any purpose, until
it shall have been entered in the stock records of the
Corporation by an entry showing from and to whom
transferred. The Board may also make such additional
rules and regulations as it may deem expedient
concerning the issue and transfer of certificates
representing shares of the capital stock of the
Corporation.
SECTION 3. Record Date. For the purpose of
determining shareholders entitled to notice of or to
vote at any meeting of shareholders or any adjournment
thereof, or entitled to receive payment of any
dividend, or in order to make a determination of
shareholders for any other proper purpose, the Board
may fix in advance a date as the record date for any
such determination of shareholders, such date in any
case to be not more than seventy days prior to the
date on which the particular action, requiring such
determination of shareholders, is to be taken. When a
determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in
this section, such determination shall apply to any
adjournment thereof unless the Board fixes a new
record date, which it shall do if the meeting is
adjourned to a date more than 120 days after the date
fixed for the original meeting.
SECTION 4. Lost. Destroyed or Mutilated
Certificates. In case of loss, destruction or
mutilation of any certificate of stock, another may be
issued in its place upon proof of such loss,
destruction or mutilation and upon the giving of a
bond of indemnity to the Corporation in such form and
in such sum as the Board may direct; provided that a
new certificate may be issued without requiring any
bond when, in the judgment of the Board, it is proper
so to do.
SECTION 5. Restrictions on Transfer. To the extent
that the Rights Agreement dated as of February 27,
1986, between the Corporation and Manufacturers
Hanover Trust Company may be deemed to impose
restrictions on the transfer of securities of the
Corporation, such restrictions are hereby authorized.
ARTICLE IX.
INSPECTION OF RECORDS.
The Board from time to time shall determine
whether, to what extent, at what times and places, and
under what conditions and regulations the accounts and
books and papers of the Corporation, or any of them,
shall be open for the inspection of the shareholders,
and no shareholder shall have any right to inspect any
account or book or paper of the Corporation except as
expressly conferred by statute or by these By-laws or
authorized by the Board.
ARTICLE X.
AUDITOR.
The Board shall annually appoint an independent
accountant who shall carefully examine the books of
the Corporation. One such examination shall be made
immediately after the close of the fiscal year and be
ready for presentation at the annual meeting of
shareholders of the Corporation, and such other
examinations shall be made as the Board may direct.
ARTICLE XI.
SEAL.
The seal of the Corporation shall be circular in
form and shall bear the name of the Corporation and
the year "1892."
ARTICLE XII.
FISCAL YEAR.
The fiscal year of the Corporation shall end on the
3lst day of December in each year.
ARTICLE XIII.
AMENDMENTS.
The By-laws of the Corporation may be altered,
amended or repealed and new By-laws may be adopted by
the Board (except as Section 1 of Article II may
otherwise require), or by the holders of the
outstanding shares of the Corporation entitled to vote
generally at any annual or special meeting of the
shareholders when notice thereof shall have been given
in the notice of the meeting of shareholders.
EMERGENCY BY-LAWS.
SECTION 1. Definitions. As used in these Emergency
By-laws,
(a) the term "period of emergency" shall mean any
period during which a quorum of the Board cannot
readily be assembled because of some catastrophic
event.
(b) the term "incapacitated" shall mean that the
individual to whom such term is applied shall not have
been determined to be dead but shall be missing or
unable to discharge the responsibilities of his
office; and
(c) the term "senior officer" shall mean the
Chairman of the Board, the President, any corporate
Vice President, the Treasurer, the Controller and the
Secretary, and any other person who may have been so
designated by the Board before the emergency.
SECTION 2. Applicability. These Emergency By-laws,
as from time to time amended, shall be operative only
during any period of emergency. To the extent not
inconsistent with these Emergency By-laws, all
provisions of the regular By-laws of the Corporation
shall remain in effect during any period of emergency.
No officer, director or employee shall be liable
for actions taken in good faith in accordance with
these Emergency By-laws.
SECTION 3. Board of Directors. (a) A meeting of
the Board may be called by any director or senior
officer of the Corporation. Notice of any meeting of
the Board need be given only to such of the directors
as it may be feasible to reach at the time and by such
means as may be feasible at the time, including
publication or radio, and at a time less than twenty-
four hours before the meeting if deemed necessary by
the person giving notice.
(b) At any meeting of the Board, three directors in
attendance shall constitute a quorum. Any act of a
majority of the directors present at a meeting at
which a quorum shall be present shall be the act of
the Board. If less than three directors should be
present at a meeting of the Board, any senior officer
of the Corporation in attendance at such meeting shall
serve as a director for such meeting, selected in
order of rank and within the same rank in order of
seniority.
(c) In addition to the Board's powers under the
regular By-laws of the Corporation to fill vacancies
on the Board, the Board may elect any individual as a
director to replace any director who may be
incapacitated and to serve until the latter ceases to
be incapacitated or until the termination of the
period of emergency, whichever first occurs. In
considering officers of the Corporation for election
to the Board, the rank and seniority of individual
officers shall not be pertinent.
(d) The Board, during as well as before any such
emergency, may change the principal office or
designate several alternative offices or authorize the
officers to do so.
SECTION 4. Appointment of Officers. In addition to
the Board's powers under the regular By-laws of the
Corporation with respect to the election of officers,
the Board may elect any individual as an officer to
replace any officer who may be incapacitated and to
serve until the latter ceases to be incapacitated.
SECTION 5. Amendments. These Emergency By-laws
shall be subject to repeal or change by further action
of the Board of Directors or by action of the
shareholders, except that no such repeal or change
shall modify the provisions of the second paragraph of
Section 2 with regard to action or inaction prior to
the time of such repeal or change. Any such amendment
of these Emergency By-laws may make any further or
different provision that may be practical and
necessary for the circumstances of the emergency.
Exhibit 10(a)
OLIN CORPORATION
1994 STOCK PLAN FOR NON-EMPLOYEE
DIRECTORS
1. Purpose
The purpose of the Olin Corporation 1994 Stock Plan for
Non-employee Directors is to promote the long-term growth and financial
success of Olin Corporation by attracting and retaining
non-employee directors of outstanding ability and by
promoting a greater identity of interest between its
non-employee directors and its shareholders.
2. Definitions
The following capitalized terms utilized herein have the
following meanings:
"Board" means the Board of Directors of the Company.
"Cash Account" means an account established under the Plan
for a Non-employee Director to which cash meeting fees and
retainers have been or are to be credited in the form of
cash.
"Change in Control" means any of the following: (i) the
Company ceases to be, directly or indirectly, owned by at
least 1,000 shareholders; (ii) a person, partnership, joint
venture, corporation or other entity, or two or more of any
of the foregoing acting as a "person" within the meaning of
Section 13(d)(3) of the 1934 Act, other than the Company, a
majority-owned subsidiary of the Company or an employee
benefit plan (or related trust) of the Company or such
subsidiary, become(s) the "beneficial owner" (as defined in
Rule 13d-3 under the 1934 Act) of 20% or more of the then
outstanding voting stock of the Company; and (iii) during
any period of two consecutive years, individuals who
at the beginning of such period constitute the Board
(together with any new director whose election by the Board
or whose nomination for election by the Company's
shareholders was approved by a vote of at least two-thirds
of the directors then still in office who either were
directors at the beginning of such period or whose election
or nomination for election was previously so approved) cease
for any reason to constitute a majority of the directors
then in office.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Committee" means the Directors Committee (or its
successor) of the Board.
"Common Stock" means the Company's Common Stock, $1.00 par
value per share.
"Company" means Olin Corporation, a Virginia corporation,
and any successor.
"Credit Date" means the first day of each calendar
quarter, beginning with January 1, 1995.
"Excess Retainer" means with respect to a Non-employee
Director the amount of the full annual cash retainer payable
to such Non-employee Director from time to time by the
Company for service as a director in excess of $25,000, if
any; provided that in the event the annual cash retainer is
prorated to reflect that such Non-employee Director did not
serve as such for the full calendar year, the $25,000 shall
be similarly prorated.
"Fair Market Value" means, with respect to a date, on a
per share basis, the average of the high and the low price
of a share of Common Stock reported on the consolidated tape
of the New York Stock Exchange on such date or if the New
York Stock Exchange is closed on such date, the next
preceding date on which it is open.
"1934 Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Non-employee Director" means a member of the Board who is
not an employee of the Company or any subsidiary thereof.
"Plan" means the Olin Corporation 1994 Stock Plan for
Non-employee Directors.
"Retirement Date" means the date the Non-employee Director
ceases to be a member of the Board.
"Stock Account" means an account established under the
Plan for a
Non-employee Director to which shares of Common Stock have
been or are to be credited in the form of stock.
3. Term
The Plan shall become effective October 1, 1994 provided
the shareholders of the Company approve the Plan prior to
such date. Once effective, the Plan shall operate and shall
remain in effect until terminated by action of the Board as
provided in Section 9 hereof.
4. Administration
Full power and authority to construe, interpret and
administer the Plan shall be vested in the Committee.
Decisions of the Committee shall be final, conclusive and
binding upon all parties.
5. Participation
All Non-employee Directors shall participate in the Plan.
6. Grants and Deferrals
(a) Annual Stock Grant. Subject to the terms and
conditions of the Plan, each Non-employee Director shall be
credited with 100 shares of Common Stock each calendar year
beginning in 1995. To be entitled to such credit in any
calendar year, a Non-employee Director must be serving as
such on January 1 of such year. Actual receipt of shares
credited shall be deferred and each eligible Non-employee
Director shares shall receive a credit to his or her Stock
Account in the amount of 100 shares of Common Stock as of January 1.
A Non-employee Director may elect in accordance with Section
6(e) to defer to his or her Stock Account receipt of all or
any portion of such shares (including dividends thereon
payable in accordance with Section 6(e)(4)) to a date or
dates on or following such Non-employee Director's
Retirement Date. Except with respect to any shares the
director has so elected to defer, certificates representing
such shares shall be delivered to the Non-employee Director
(or in the event of death, to his or her beneficiary designated pursuant to
Section 6(h)) as soon as practicable following the Retirement Date.
(b) Annual Retainer Stock Grant. Subject to the terms and
conditions of the Plan, on each January 1 of each year
beginning with 1995, each Non-employee Director who is such
on such date shall receive that number of shares (rounded up
to the next whole share) of Common Stock having an aggregate
Fair Market Value on such date of $25,000 (except in the
case of January 1, 1995 only, the $25,000 figure shall be
increased by $6,250 and the Non-employee Directors shall not
receive any quarterly cash retainer for the fourth quarter
of 1994). In the event a person becomes in a calendar year
a Non-employee Director subsequent to January 1 and has not
received the annual stock retainer for such calendar year,
such person, on the first day of the calendar month
following his or her becoming such, shall receive that
number of shares (rounded up to the next whole share in the
event of a fractional share) of Common Stock having an aggregate
Fair Market Value on such first day of an amount equal to $2,084
times the number of whole calendar months remaining in such calendar year
following the date he or she becomes a Non-employee
Director. The annual cash retainer payable to the
Non-employee Director shall be reduced by the aggregate Fair
Market Value on the date the Non-employee Director becomes
entitled to receive shares under this Section 6(b) for such
calendar year. A Non-employee Director may elect to defer
receipt of all or any portion of such shares in accordance
with Section 6(e). Except with respect to any shares the
director has so elected to defer, certificates representing
such shares shall be delivered to such Non-employee Director as soon as
practicable.
(c) Election to Receive Meeting Fees and Excess Retainer
in Stock in Lieu of Cash. Subject to the terms and
conditions of the Plan, a Non-employee Director may elect to
receive all or a portion of the director meeting fees and
the Excess Retainer payable in cash by the Company for his
or her service as a director for the calendar year in the
form of shares of Common Stock. Such election shall be made
in accordance with Section 6(e). The number of shares
(rounded up to the next whole share in the event of a
fractional share) for a calendar year payable to a
Non-employee Director who so elects to receive the
Excess Retainer in the form of shares for such year shall be
equal to the aggregate Fair Market Value on January 1 of
such calendar year (or in the case of a Non-employee
Director who becomes such after January 1, on the first day
of the calendar month following the day such new
Non-employee Director became such) of the amount of Excess
Retainer which has been elected to be paid in shares. The
number of shares (rounded up to the next whole share in the
event of a fractional share) for a calendar quarter payable
to a Non-employee Director who so elects to receive meeting
fees in the form of shares shall be equal to the aggregate
Fair Market Value on the Credit Date following such
quarter of the director meeting fees which have been earned
in such quarter and which are elected to be paid in shares.
Except with respect to any shares the director has elected
to defer, certificates representing such shares shall be
delivered to the Non-employee Director as soon as
practicable.
(d) Deferrals of Meeting Fees and Excess Retainer. Subject
to the terms and conditions of the Plan, a Non-employee
Director may elect to defer all or a portion of the shares
payable under Section 6(c) and all or a portion of the
director meeting fees and Excess Retainer payable in cash by
the Company for his or her service as a director for the
calendar year. Such election shall be made in accordance
with Section 6(e). A Non-employee Director who elects to so
defer shall have any deferred shares deferred in the form of
shares of Common Stock and any deferred cash fees and
retainer deferred in the form of cash.
(e) Elections. (1) All elections under Sections 6(a),
6(b), 6(c) and 6(d) shall (A) be made in writing and
delivered to the Secretary of the Company and (B) be
irrevocable. All elections for payments or deferrals in the
form of Common Stock shall be made before July 1 of the year
prior to the year in which the shares of Common Stock or
director's fees and retainer are to be earned (or, in the
case of an individual who becomes a Non-employee Director
during a calendar year, at least six months prior to the
date the fees or shares are to be earned, and otherwise in
the case of all Non-employee Directors for the 1994
calendar year, before April 1, 1994). Elections for
deferrals in the form of cash under Section 6(d) shall be
made on or before December 31 prior to the year the
director's fees or retainer are to be earned (or, in the
case of an individual who becomes a Non-employee Director
during a calendar year, prior to the date of his or her
election as a director and otherwise in the case of all
Non-employee Directors for the 1994 calendar year, on or
prior to June 30, 1994). Deferral elections shall also (A)
specify the portions (in 25% increments) to be deferred and
(B) specify the future date or dates on which deferred
amounts are to be paid or the future event or events upon
the occurrence of which the deferred amounts are to be paid
and the method of payment (lump sum or annual installments
of approximately equal amounts (up to 10)). In the event of
an election under Section 6(c) for director meeting fees
or Excess Retainer to be paid in shares of Common Stock, the
election shall specify the portion (in 25% increments) to be
so paid. Any change with respect to the terms of his
election for (A) the payment of director meeting fees or
Excess Retainer under Section 6(c) from shares to cash or
vice versa and (B) the amount of any deferral in the form of
Common Stock and the timing or amount of payments from the
Stock Account shall only be effective six months following
such change in the election.
(2) Stock Account. On the Credit Date, a Non-employee
Director who has elected to defer shares under Sections 6(b) or 6(d) shall
receive a credit to his or her Stock Account. The amount of
such credit shall be the number of shares so deferred
(rounded to the next whole share in the event of a
fractional share).
(3) Cash Account. On the Credit Date or in the case of the
Excess Retainer, on the day on which the Non-employee
Director is entitled to receive such Excess Retainer, a
Non-employee Director who has elected to defer cash fees
and/or the Excess Retainer under Section 6(d) in the form of
cash shall receive a credit to his or her Cash Account. The
amount of the credit shall be the dollar amount of such
Director's meeting fees earned during the immediately
preceding quarterly period or the amount of the Excess
Retainer to be paid for the calendar year, as the case may
be, and in each case, specified for deferral in cash.
(4) Dividends and Interest. Each time a cash dividend is
paid on the Common Stock, a Non-employee Director who has
shares credited to his or her Stock Account shall receive a
credit for such dividends on the dividend payment date to
his or her Stock Account; provided dividends paid with
respect to shares granted under Section 6(a) shall not be
credited to the Stock Account but shall instead be promptly
paid directly to such Non-employee Director unless such
director shall have elected to defer receipt thereof as
provided in Section 6(a). The amount of the dividend credit
shall be the number of shares (rounded
to the nearest one-hundredth of a share) determined by
multiplying the dividend amount per share by the number of
shares credited to such director's Stock Account as of the
record date for the dividend and dividing the product by the
Fair Market Value per share on the dividend payment date.
The Cash Account of a Non-employee Director shall be
credited on each Credit Date with interest on such account's
balance at the end of the preceding quarter, payable at a
rate equal to the pre-tax cost of borrowing of the Company
on such date as determined from time to time by the Chief
Financial Officer, Controller or Treasurer of the Company.
(5) Payouts. Cash Accounts will be paid out in cash and
Stock Accounts shall be paid out in shares of Common Stock.
Cash amounts credited to a Cash Account and certificates
representing shares credited to a Stock Account shall be
delivered to the Non-employee Director as soon as
practicable following the termination of the deferral and
consistent therewith.
(f) No Stock Rights. The deferral of shares of Common
Stock into a Stock Account shall confer no rights upon such
Non-employee Director, as a shareholder of the Company or
otherwise, with respect to the shares held in such Stock
Account, but shall confer only the right to receive such
shares credited as and when provided herein.
(g) Change in Control. Notwithstanding anything to the
contrary in this Plan
or any election, in the event a Change in Control occurs,
amounts and shares credited to Cash Accounts and Stock
Accounts shall be promptly distributed to Non-employee
Directors.
(h) Beneficiaries. A Non-employee Director may designate
at any time and from time to time a beneficiary for his or
her Stock and Cash Accounts in the event his or her Stock or
Cash Account may be paid out following his or her death.
Such designation shall be in writing and received by the
Company prior to the death to be effective.
7. Limitations and Conditions
(a) Total Number of Shares. The total number of shares of
Common Stock that may be issued to Non-employee Directors
under the Plan is 90,000. Such total number of shares may
consist, in whole or in part, of authorized but unissued
shares. The foregoing number may be increased or decreased
by the events set forth in Section 8 below. No fractional
shares shall be issued hereunder. In the event a
Non-employee Director is entitled to a fractional share,
such share amount shall be rounded upward to the next whole
share amount.
(b) No Additional Rights. Nothing contained herein shall
be deemed to create a right in any Non-employee Director to
remain a member of the Board, to be nominated for reelection
or to be reelected as such or, after ceasing to be such a
member, to receive any cash or shares of Common Stock under
the Plan which are not already credited to his or her
accounts.
8. Stock Adjustments
In the event of any merger, consolidation, stock or other
non-cash dividend, extraordinary cash dividend, split-up,
spin-off, combination or exchange of shares or
recapitalization or change in capitalization, or any other
similar corporate event, the Committee may make such
adjustments in (i) the aggregate number of shares of Common
Stock that may be issued under the Plan as set forth in
Section 7(a) and the number of shares that may be issued to
a Non-employee Director with respect to any year as set
forth in Section 6(a), (ii) the class of shares that may be
issued under the Plan and (iii) the amount and type of
payment that may be made in respect of unpaid dividends on
shares of Common Stock whose receipt has been deferred
pursuant to Section 6(e), as the
Committee shall deem appropriate in the circumstances. The
determination by the Committee as to the terms of any of the
foregoing adjustments shall be final, conclusive and binding
for all purposes of the Plan.
9. Amendment and Termination
This Plan may be amended, suspended or terminated by
action of the Board; provided, however, that (a) the
provisions of the Plan may not be amended more than once
every six months, other than to comport with changes in the
Code, or the rules thereunder, and (b) if the Plan has been
approved by the shareholders of the Company, any amendment
shall be similarly approved if the amendment would:
(i) materially increase the benefits accruing to
participants under the Plan;
(ii) materially increase the number of securities which
may be issued under the Plan (except as provided in Section
8); or
(iii) materially modify the requirements as to eligibility
for participation in the Plan.
Furthermore, no termination of the Plan shall adversely
affect the rights of any Non-employee Director with respect
to any amounts otherwise payable or credited to his or her
Cash Account or Stock Account.
10. Nonassignability
No right to receive any payments under the Plan or any
amounts credited to a Non-employee Director's Cash or Stock
Account shall be assignable or transferable by such
Non-employee Director other than by will or the laws of
descent and distribution or pursuant to a domestic relations
order. The designation of a beneficiary under Section 6(h)
by a Non-employee Director does not constitute a transfer.
11. Unsecured Obligation
Benefits payable under this Plan shall be an unsecured
obligation of the Company.
12. Rule 16b-3 Compliance
It is the intention of the Company that the Plan comply in
all respects with Rule 16b-3 promulgated under Section 16(b)
of the 1934 Act and that Plan participants remain
disinterested persons ("Disinterested Persons") for purposes
of administering other employee benefit plans of the Company
and having such other plans be exempt from Section 16(b) of
the 1934 Act. Therefore, if any Plan provision is found not
to be in compliance with Rule 16b-3 or if any Plan provision
would disqualify Plan participants from remaining
Disinterested Persons, that provision shall be deemed
amended so that the Plan does so comply and the Plan
participants remain disinterested, to the extent permitted
by law and deemed advisable by the Committee, and in all
events the Plan shall be construed in favor of its meeting
the requirements of Rule 16b-3.
Exhibit 10(b)
OLIN SENIOR MANAGEMENT INCENTIVE COMPENSATION PLAN
Section 1. Purpose. The purposes of the Olin Senior
Management Incentive Compensation Plan (the "Plan") are (i)
to compensate certain members of senior management of Olin
Corporation (the "Company") on an individual basis for
significant contributions to the Company and its
subsidiaries and (ii) to stimulate the efforts of such
members by giving them a direct financial interest in the
performance of the Company.
Section 2. Definitions. The following terms utilized in
this Plan shall have the following meanings:
"Cash Flow" shall mean consolidated net income of the
Company, before the after-tax effect of any special charge
or gain or cumulative effect of any change in accounting,
plus depreciation and amortization, less capital and
investment spending and plus or minus changes in working
capital.
"Committee" shall mean the Compensation and Stock Option
Committee of the Board of Directors of the Company or such
other committee of such Board as such Board may from time to
time designate.
"Consolidated Net Assets" shall mean consolidated total
assets of the Company less total non-interest bearing
liabilities.
"Earnings Per Share" shall mean for a fiscal year
consolidated net income of the Company before the after-tax
effect of any special charge or gain or cumulative effect of
a change in accounting, less ESOP preferred dividends,
divided by the weighted average number of shares of common
stock outstanding plus an equivalent number (one for one) of
shares of Common Stock assuming the conversion of the Series
A Preferred Stock.
"Participant" shall mean for a fiscal year each salaried
employee who is designated as a Participant by the Committee
prior to the commencement of such fiscal year (or such later
date, if any, as permitted by Section 162(m)); provided for
1994, the Committee shall designate the Participants prior
to April 1, 1994.
"Performance Measures" shall mean for a fiscal year
Pre-Tax Profit and Earnings Per Share; provided that the
Committee may in lieu of, or in addition to, Pre-Tax Profit and/or
Earnings Per Share designate one or more of the following as additional,
alternative or substitute Performance Measures: Cash Flow,
ROE, Return on Capital and RONA provided such designation
would not subject any Incentive Award to Section 162(m).
"Pre-Tax Profit" shall mean for a fiscal year the
consolidated income before taxes of the Company, before any
special charges or gains.
"Return on Capital" shall mean consolidated net income of
the Company plus after-tax interest expense and the
after-tax effect of any special charge or gain and any
cumulative effect of a change in accounting, divided by
average Consolidated Net Assets.
"ROE" shall mean consolidated net income of the Company
before the after-tax effect of any special charge or gain
and any cumulative effect of any change in accounting,
divided by average shareholders' equity.
"RONA" shall mean Pre-tax Profit before interest expense
divided by average Consolidated Net Assets.
"Section 162(m)" shall mean Section 162(m) of the Internal
Revenue Code of 1986, and the regulations promulgated
thereunder, all as amended from time to time.
Section 3. Term. The Plan shall be effective as of January
1, 1994 (the "Effective Date"), and shall be applicable for
all future fiscal years of the Company unless amended or
terminated by the Company pursuant to Section 7.
Section 4. Incentive Award.
4.1 For each fiscal year of the Company, each Participant
may be entitled to receive an award payable in cash
("Incentive Award") in an amount determined by the Committee
as provided in this Plan. Prior to the commencement of a
fiscal year (or such later date, if any, as permitted by
Section 162(m)) (but in the case of the 1994 fiscal year,
prior to April 1, 1994), for the Incentive Awards for such
fiscal year, the Committee will designate or approve (i) the
individuals who will be Participants in the Plan, if any,
(ii) the Performance Measures, (iii) if there is more than
one Performance Measure, the weighting of
the Performance Measures in determining the Incentive Award,
(iv) the performance goals and payout matrix or formula for each
Performance Measure and (v) the target Incentive Award for
each Participant. Following the end of a fiscal year, the
Committee shall determine the Incentive Award for each
Participant by:
(i) comparing actual performance for each measure against
the payout matrix approved for such fiscal year,
(ii) multiplying the payout percentage from the payout
matrix for each Performance Measure by the appropriate weighting factor, and
(iii) summing the weighted payout percentages and
multiplying their overall payout percentage by the
Participant's target Incentive Award.
Notwithstanding anything contained in this Plan to the
contrary, the Committee in its sole discretion may reduce any Incentive
Award to any Participant to any amount, including zero, prior to the
certification by resolution of the Committee of the amount of such Incentive
Award.
As a condition to the right of a Participant to receive an
Incentive Award, the Committee shall first certify, by
resolution of the Committee, that the Incentive Award has
been determined in accordance with the provisions of this
Plan.
Incentive Awards for a fiscal year shall be determined as
soon as practicable after such fiscal year and shall be paid
no later than 75 days following such fiscal year unless
deferred as provided in Section 4.4 hereof. The maximum
Incentive Award paid a Participant under this Plan with
respect to a fiscal year may not exceed 100% of such
Participant's annual base salary in effect on December 31 of
the immediately preceding fiscal year.
4.2 A Participant whose employment terminates with cause
or without the Committee's written consent during a fiscal
year shall forfeit such Participant's Incentive Award for such fiscal year.
4.3 Incentive Awards shall be payable in a single, lump
sum. However, the Committee may in its discretion elect to
defer payment of any Incentive Award until such date before
or after retirement as a Participant may request upon such
terms and conditions as may be approved or established by
the Committee in its sole judgment; provided that deferrals
in the form of phantom stock shall be paid only in the form
of cash and on a fixed date or dates at least six months
after the grant of the Incentive Award or incident to death,
retirement, disability or termination of employment. Such terms may
include the payment of interest or dividend equivalents on
deferred amounts.
4.4 The Company shall withhold from any Incentive Award or
payments made or to be made under this Plan any amount of
withholding taxes due in respect of an Incentive Award, its
deferral or payment.
4.5 Participation in this Plan does not exclude
Participants from participation in any other benefit or
compensation plans orarrangements of the Company, including other bonus or
incentive plans.
Section 5. Administration and Interpretation. The Plan
shall be administered by the Committee, which shall have the
sole authority to make rules and regulations for the
administration of the Plan. The interpretations and
decisions of the Committee with regard to the Plan shall be
final and conclusive. The Committee may request advice or
assistance or employ such persons (including, without
limitation, legal counsel and accountants) as it deems
necessary for the proper administration of the Plan.
Section 6. Administrative Expenses. Any expense incurred
in the administration of the Plan shall be borne by the Company out
of its general funds.
Section 7. Amendment or Termination. The Committee of the
Company may from time to time amend the Plan in any respect
or terminate the Plan in whole or in part, provided that no
such action shall increase the amount of any Incentive Award
for which performance goals have been established but which
has not yet been earned or paid: provided further that such
action will not cause an Incentive Award to become subject
to the deduction limitations contained in Section 162(m).
Section 8. No Assignment. The rights hereunder, including
without limitation rights to receive an Incentive Award,
shall not be pledged, assigned, transferred, encumbered or
hypothecated by an employee of the Company, and during the
lifetime of any Participant any payment of an Incentive
Award shall be payable only to such Participant. A
Participant, however, may designate in writing at any time
and from time to time one or more beneficiaries to receive
the payment of any deferred Incentive Award in the event of
the Participant's death; provided such designation is
received by the Company prior to such death.
Section 9. The Company. For purposes of this Plan, the
"Company" shall include the successors and assigns of the Company, and this
Plan shall be binding on any corporation or other person
with which the Company is merged or consolidated.
Section 10. Stockholder Approval. This Plan shall be
subject to approval by a vote of the stockholders of the
Company at the 1994 Annual Meeting, and such stockholder
approval shall be a condition to the right of a Participant
to receive any benefits hereunder.
Section 11. No Right to Employment. The designation of an
employee as a Participant or grant of an Incentive Award
shall not be construed as giving a Participant the right to
be retained in the employ of the Company or any affiliate or
subsidiary.
Section 12. Governing Law. The validity, construction and
effect of the Plan and any rules and regulations relating to
the Plan shall be determined in accordance with the laws of
the State of Connecticut and applicable federal law.
Section 13. No Trust. Neither the Plan nor any Incentive
Award shall create or be construed to create a trust or
separate fund of any kind or a fiduciary relationship
between the Company or any Participant. To the extent any
Participant acquires a right to receive payments from the
Company in respect to any Incentive Award, such right shall
be no greater than the right of any unsecured general
creditor of the Company.
Section 14. Section 162(m). It is the intention of the
Company that all payments made under the Plan be excluded
from the deduction limitations contained in Section 162(m).
Therefore, if any Plan provision is found not to be in
compliance with the "performance-based" compensation
exception contained in Section 162(m), that provision shall
be deemed amended so that the Plan does so comply to the
extent permitted by law and deemed advisable by the
Committee, and in all events the Plan shall be construed in favor of
its meeting the "performance-based" compensation exception
contained in Section 162(m).
Exhibit 10(c)
OLIN 1991 LONG TERM INCENTIVE PLAN
(As Amended through April 28, 1994)
Section 1. Purpose
The purposes of the Olin 1991 Long Term Incentive Plan (the
"Plan") are to encourage selected salaried employees of Olin
Corporation (together with any successor thereto, "Olin")
and its Affiliates (as defined below) to acquire a
proprietary interest in Olin's growth and performance, to
generate an increased incentive to contribute to Olin's
future success and to enhance the ability of Olin and its
Affiliates to attract and retain qualified individuals.
Section 2. Definitions
As used in the Plan:
(a) "Affiliate" means (i) any entity that, directly or
through one or more intermediaries, is controlled by
Olin and (ii) any entity in which Olin has a significant
equity interest as determined by the Committee.
(b) "Award" means any Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit, Performance
Award, Dividend Equivalent or Other Stock-Based Award
granted under the Plan.
(c) "Award Agreement" means any written agreement or other
instrument or document evidencing an Award granted under
the Plan. The terms of any plan or guideline adopted by
the Board or the Committee and applicable to an Award
shall be deemed incorporated in and a part of the
related Award Agreement.
(d) "Board" means the Board of Directors of Olin.
(e) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(f) "Committee" means a committee of the Board designated by
the Board to administer the Plan and composed of not
less than three directors, each of whom is qualified to
administer the Plan as contemplated by Rule 16b-3.
(g) "Dividend Equivalent" means any right granted under
Section 6(f)(iv) of the Plan.
(h) "Fair Market Value" means, with respect to any property
(including, without limitation, Shares or other
securities), the fair market value of such property
determined by such methods or procedures as shall be
established from time to time by the Committee.
(i) "Incentive Stock Option" means an option to purchase
Shares granted under Section 6(a) of the Plan that is
intended to meet the requirements of Section 422 of the
Code or a successor provision thereto.
(j) "Non-Qualified Stock Option" means an option to purchase
Shares granted under Section 6(a) of the Plan that is
not intended to be an Incentive Stock Option.
(k) "Option" means an Incentive Stock Option or a Non-
Qualified Stock Option.
(l) "Other Stock-Based Award" means any right granted under
Section 6(e) of the Plan.
(m) "Participant" means a Salaried Employee granted an Award
under the Plan.
(n) "Performance Award" means any right granted under
Section 6(d) of the Plan.
(o) "Person" means any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated
organization, or government or political subdivision
thereof.
(p) The "1988 Plan" means the 1988 Stock Option Plan for Key
Employees of Olin Corporation and Subsidiaries.
(q) "Released Securities" means securities that were
Restricted Securities with respect to which all
applicable restrictions imposed under the terms of the
relevant Award have expired, lapsed or been waived or
satisfied.
(r) "Restricted Securities" means Awards of Restricted Stock
or other Awards under which outstanding Shares are held
subject to certain restrictions.
(s) "Restricted Stock" means any Share granted under Section
6(c) of the Plan.
(t) "Restricted Stock Unit" means any right granted under
Section 6(c) of the Plan that is denominated in Shares.
(u) "Rule 16b-3" means Rule 16b-3 promulgated by the
Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended, or any successor rule.
(v) "Salaried Employee" means any salaried employee of Olin
or of an Affiliate.
(w) "Shares" means the Common Stock of Olin and such other
securities or property as may become the subject of
Awards pursuant to an adjustment made under Section 4(b)
of the Plan.
(x) "Stock Appreciation Right" means any right granted under
Section 6(b) of the Plan.
Section 3. Administration
The Plan shall be administered by the Committee which shall
have full power and authority to: (i) designate
Participants; (ii) determine the Awards to be granted to
Participants; (iii) determine the number of Shares (or
securities convertible into Shares) to be covered by Awards;
(iv) determine the terms and conditions of any Award; (v)
determine whether, to what extent, and under what
circumstances Awards may be settled or exercised in cash,
Shares, other securities, other Awards, or other property,
or canceled, substituted, forfeited or suspended, and the
method or methods by which Awards may be settled, exercised,
canceled, substituted, forfeited or suspended; (vi)
determine whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards,
other property and other amounts payable with respect to an
Award under the Plan shall be deferred either automatically
or at the election of the Participant or of the Committee;
(vii) interpret and administer the Plan and any instrument
or agreement relating to, or Award made under, the Plan;
(viii) establish, amend, suspend or waive such rules and
guidelines and appoint such agents as it shall deem
appropriate for the administration of the Plan; and (ix)
make any other determination and take any other action that
it deems necessary or desirable for such administration.
All designations, determinations, interpretations and other
decisions with respect to the Plan or any Award shall be
within the sole discretion of the Committee and shall be
final, conclusive and binding upon all Persons, including
Olin, any Affiliate, any Participants, any holder or
beneficiary of any Award, any shareholder and any employee
of Olin or of any Affiliate. The Committee's powers include
the adoption of modifications, amendments, procedures,
subplans and the like as are necessary to comply with
provisions of the laws of other countries in which Olin or
an Affiliate may operate in order to assure the viability of
Awards granted under the Plan and to enable Participants
employed in such other countries to receive benefits under
the Plan and such laws.
Section 4. Shares Available for Awards
(a) Shares Available. Subject to adjustment as provided in
Section 4(b) of the Plan:
(i) The aggregate number of Shares available for
granting Awards under the Plan shall be 500,000,
provided that in the event the 1988 Plan shall
terminate or be cancelled prior to April 30, 1998
(its stated expiration date), the number of Shares
available for the grant of Awards under the Plan
shall be increased by the sum (not to exceed
800,000) of (a) the number of shares which were
available for the grant of options under the 1988
Plan immediately prior to the date of such
termination or cancellation and (b) the aggregate
number of shares which were subject to options
under the 1988 Plan on such date and were not
subsequently issued because such options
terminated, expired or were forfeited without the
delivery to optionees of Shares or other
consideration. If an Award is denominated in or
relates to a security of Olin convertible into its
Common Stock, the number of shares of Common Stock
into which such security shall be convertible
(calculated as of the date of grant of the Award,
subject to adjustment as provided in Section 4(b)
hereof or under the terms of such security) shall
be deemed denominated in Shares and counted
against the aggregate number of Shares available
for the granting of Awards under the Plan. If,
after the effective date of the Plan, Shares
subject to an Award granted under the Plan (other
than Restricted Securities) are forfeited, or the
Award otherwise terminates without the delivery of
Shares or of other consideration, then the Shares
subject to such Award or the number of Shares
otherwise counted against the aggregate number of
Shares available under the Plan with respect to
such Award, to the extent of such forfeiture or
termination, shall again be available for granting
Awards under the Plan." Any Award (other than a
Dividend Equivalent) denominated in Shares shall
be counted against the aggregate number of Shares
available for granting Awards under the Plan even
though the Award is ultimately paid in cash,
provided that, notwithstanding the foregoing, an
Award shall not be deemed denominated in Shares if
the dollar amount of the Award is fixed at the
time of grant by reference to the market value of
Shares or otherwise.
(ii) For purposes of this Section 4:
(A) If an Award (other than a Dividend Equivalent)
is denominated in Shares, the number of Shares
covered by such Award, or to which such Award
relates, shall be counted on the date of grant
of such Award against the aggregate number of
Shares available for granting Awards under the
Plan; and
(B) Dividend Equivalents paid in Shares and Awards
not denominated in Shares but paid in Shares
shall be counted against the aggregate number
of Shares available for granting Awards under
the Plan in such amount and at such time as
the Committee shall determine under procedures
adopted by the Committee consistent with the
purposes of the Plan;
provided, however, that Awards that operate in tandem
with, or that are substituted for, other Awards may be
counted or not counted under procedures adopted by the
Committee in order to avoid double counting. Any Shares
that are delivered by Olin, and any Awards that are
granted by, or become obligations of, Olin, through the
assumption by Olin or an Affiliate of, or in
substitution for, outstanding awards previously granted
by an acquired company shall not, except in the case of
Awards granted to Salaried Employees who are officers or
directors of Olin for purposes of Section 16 of the
Securities Exchange Act of 1934, as amended, be counted
against the Shares available for granting Awards under
the Plan.
(b) Adjustments. In the event that the Committee determines
that any dividend or other distribution,
recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-
off, combination, repurchase or exchange of Shares or
other securities of Olin, issuance of warrants or other
rights to purchase Shares or other securities of Olin,
or other similar corporate transaction or event affects
the Shares such that an adjustment is determined by the
Committee to be appropriate in order to prevent dilution
or enlargement of the benefits intended to be made
available under the Plan, then the Committee shall, in
such manner as it may deem equitable, adjust any or all
of (i) the number and type of Shares (or other
securities or property) which thereafter may be made the
subject of Awards, (ii) the number and type of Shares
(or other securities or property) subject to outstanding
Awards, and (iii) the grant, purchase or exercise price
with respect to any Award, or, if the Committee deems it
appropriate, make provision for a cash payment to the
holder of an outstanding Award; provided, however, that
with respect to Awards of Incentive Stock Options, no
such adjustment shall be authorized to the extent that
such authority would cause the Plan to violate Section
422 of the Code or any successor provision thereto.
Notwithstanding the foregoing, a Participant to whom
Dividend Equivalents or dividend units have been awarded
shall not be entitled to receive a special or
extraordinary dividend or distribution unless the
Committee shall have expressly authorized such receipt.
(c) Notwithstanding anything contained in this Plan to the
contrary, grants to any one Participant of Awards which
represent or are designated in Shares shall not exceed
60,000 Shares in any calendar year.
Section 5. Eligibility
Any Salaried Employee, including any officer or employee-
director of Olin or an Affiliate, who is not a member of the
Committee shall be eligible to be designated a Participant.
Section 6. Awards
(a) Options. The Committee is authorized to grant Options
to Participants with the following terms and conditions
and with such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the
Committee shall determine:
(i) Exercise Price. The purchase price per Share
purchasable under an Option shall be determined by
the Committee; provided, however, that such
purchase price shall not be less than the Fair
Market Value of a Share on the date of grant of
such Option.
(ii) Option Term. The term of each Option shall be
fixed by the Committee, provided that in no event
shall the term of an Option exceed a period of ten
years from the date of its grant.
(iii) Exercise. The Committee shall determine the time
or times at which an Option may be exercised in
whole or in part (but in no event shall an Option
be exercisable before the expiration of six months
from the date of its grant, subject to Section 9
thereof, or after the expiration of ten years from
the date of its grant), and the method or methods
by which, and the form or forms (including,
without limitation, cash, Shares, other Awards or
other property, or any combination thereof, having
a Fair Market Value on the exercise date equal to
the relevant exercise price) in which, payment of
the exercise price with respect thereto may be
made; provided that no Shares may be used by a
Participant in payment of the exercise price of an
Option unless such Shares have been held by the
Participant for at least six months.
(iv) Incentive Stock Options. The terms of any
Incentive Stock Option granted under the Plan
shall comply in all respects with the provisions
of Section 422 of the Code, or any successor
provision thereto, and any regulations promulgated
thereunder. Without limiting the preceding
sentence, the aggregate Fair Market Value
(determined at the time an option is granted) of
Shares with respect to which Incentive Stock
Options are exercisable for the first time by a
Participant during any calendar year (under the
Plan and any other plan of the Participant's
employer corporation and its parent and subsidiary
corporations providing for Options) shall not
exceed such dollar limitation as shall be
applicable to Incentive Stock Options under
Section 422 of the Code or a successor provision.
(b) Stock Appreciation Rights. The Committee is authorized
to grant Stock Appreciation Rights to Participants which
may but need not relate to a specific Option granted
under Section 6(a). Subject to the terms of the Plan
and any applicable Award Agreement, each Stock
Appreciation Right granted under the Plan shall confer
on the holder thereof a right to receive, upon exercise
thereof, up to the excess of (i) the Fair Market Value
of one Share on the date of exercise over (ii) the
exercise price of the right as specified by the
Committee, which shall not be less than the Fair Market
Value of one Share on the date of grant of the Stock
Appreciation Right. Subject to the terms of the Plan
and any applicable Award Agreement, the exercise price,
term, methods of exercise, methods of payment or
settlement and any other terms and conditions of any
Stock Appreciation Right shall be as determined by the
Committee, except that Stock Appreciation Rights related
to Incentive Stock Options shall have the same terms and
conditions as such Options, and in no event shall the
term of a Stock Appreciation Right exceed a period of
ten years from the date of its grant. In the case of
any Stock Appreciation Right related to an Option, the
Stock Appreciation Right or applicable portion thereof
shall terminate and no longer be exercisable upon the
termination or exercise of the related Option, except
that a Stock Appreciation Right granted with respect to
less than the full number of Shares covered by a related
Option shall not be reduced until the exercise or
termination of the related Option exceeds the number of
shares not covered by the Stock Appreciation Right and
then only to the extent of the excess. Any Option
related to a Stock Appreciation Right shall no longer be
exercisable to the extent the related Stock Appreciation
Right has been exercised.
(c) Restricted Stock and Restricted Stock Units.
(i) Issuance. The Committee is authorized to
grant Awards of Restricted Stock and Restricted
Stock Units to Participants.
(ii) Restrictions. Shares of Restricted Stock and
Restricted Stock Units shall be subject to such
restrictions as the Committee may impose
(including, without limitation, any limitation
on the right to vote a Share of Restricted Stock
or the right to receive any dividend or other
right or property), which restrictions may lapse
separately or in combination at such time or
times, in such installments or otherwise, as the
Committee may deem appropriate, provided that in
order for a participant to vest in Awards of
Restricted Stock or Restricted Stock Units, the
participant must remain in the employ of Olin or
an Affiliate for a period of not less than six
months commencing on the date of grant of the
Award, subject to Section 9 hereof and subject
to relief for specified reasons as may be
approved by the Committee.
(iii) Registration. Any Restricted Stock granted
under the Plan may be evidenced in such manner
as the Committee may deem appropriate,
including, without limitation, book-entry
registration or issuance of a stock certificate
or certificates. In the event any stock
certificate is issued in respect of Shares of
Restricted Stock granted under the Plan, such
certificate shall be registered in the name of
the Participant and when delivered to the
Participant shall bear an appropriate legend
referring to the terms, conditions and
restrictions applicable to such Restricted
Stock.
(iv) Forfeiture. Except as otherwise determined
by the Committee, upon termination of employment
for any reason during the applicable restriction
period, all Shares of Restricted Stock and all
Restricted Stock Units still subject to
restriction shall be forfeited and reacquired by
Olin; provided, however, that the Committee may,
in its sole discretion, waive in whole or in
part any or all remaining restrictions with
respect to Shares of Restricted Stock or
Restricted Stock Units. Unrestricted Shares,
evidenced in such manner as the Committee shall
deem appropriate, shall be delivered to the
holder of Restricted Stock promptly after such
Restricted Stock shall become Released
Securities.
(d) Performance Awards. The Committee is authorized to
grant Performance Awards to Participants. Subject to
the terms of the Plan and any applicable Award
Agreement, a Performance Award granted under the Plan
(i) may be denominated or payable in cash, Shares
(including, without limitation, Restricted Stock), other
securities, other Awards or other property and (ii)
shall confer on the holder thereof rights valued as
determined by the Committee and payable to, or
exercisable by, the holder of the Performance Award, in
whole or in part, upon the achievement of such
performance goals during such performance periods as the
Committee shall establish. Subject to the terms of the
Plan and any applicable Award Agreement, the performance
goals to be achieved during any performance period, the
length of any performance period, the amount of any
Performance Award granted, and the amount of any payment
or transfer to be made pursuant to any Performance Award
shall be determined by the Committee, provided that a
performance period shall be at least six months, subject
to Section 9 thereof.
(e) Other Stock-Based Awards. The Committee is authorized
to grant to Participants such other awards denominated
or payable in, valued in whole or in part by reference
to, or otherwise based on or related to, Shares
(including, without limitation, phantom Shares,
securities convertible into Shares and dividend units),
as are deemed by the Committee to be consistent with the
purposes of the Plan, provided that such grants shall
comply with Rule 16b-3 to the extent applicable and
applicable law. Subject to the terms of the Plan and
any applicable Award Agreement, the Committee shall
determine the terms and conditions of such Awards.
Shares or other securities delivered pursuant to a
purchase, exchange or conversion right granted under
this Section 6(e) shall be issued for such
consideration, which may be paid by such method or
methods and in such form or forms, including, without
limitation, cash, Shares, other securities, other
Awards, or other property, or any combination thereof,
as the Committee shall determine, the value of which
consideration, as established by the Committee, shall
not be less than the Fair Market Value of such Shares or
other securities as of the date such purchase, exchange
or conversion right is granted.
Other Stock-based Award Agreements shall contain
provisions dealing with the disposition of such Award in
the event of termination of the Participant's employment
prior to exercise, realization or payment of the Award.
(f) General.
(i) No Cash Consideration for Awards.
Participants shall not be required to make any
cash payment for the granting of an Award except
for such minimum consideration as may be
required by applicable law.
(ii) Awards May Be Granted Separately or Together.
Awards may be granted either alone or in
addition to, in tandem with, or in substitution
for any other Award or any award or benefit
granted under any other plan or arrangement of
Olin or any Affiliate, or as payment for or to
assure payment of an award or benefit granted
under any such other such plan or arrangement,
provided that the purchase or exercise price
under an Award encompassing the right to
purchase Shares shall not be reduced by the
cancellation of such Award and the substitution
of another Award. Awards so granted may be
granted either at the same time as or at a
different time from the grant of such other
Awards or awards or benefits.
(iii) Forms of Payment Under Awards. Subject to
the terms of the Plan and of any applicable
Award Agreement, payments to be made by Olin or
an Affiliate upon the grant, exercise, or
payment of an Award may be made in such form or
forms as the Committee shall determine,
including, without limitation, cash, Shares,
other securities, other Awards, or other
property or any combination thereof, and may be
made in a single payment or transfer, in
installments, or on a deferred basis, in each
case in accordance with rules and procedures
established by the Committee.
(iv) Dividend Equivalents or Interest. Subject to
the terms of the Plan and any applicable Award
Agreement, a Participant, including the
recipient of a deferred Award, shall, if so
determined by the Committee, be entitled to
receive, currently or on a deferred basis,
interest or dividends or interest or dividend
equivalents, with respect to the Shares covered
by the Award. The Committee may provide that
any such amounts shall be deemed to have been
reinvested in additional Shares or otherwise
reinvested. Notwithstanding the award of
Dividend Equivalents or dividend units, a
Participant shall not be entitled to receive a
special or extraordinary dividend or
distribution unless the Committee shall have
expressly authorized such receipt.
(v) Limits on Transfer of Awards. No Award
(other than Released Securities) or right
thereunder shall be assignable or transferable
by a Participant, other than (unless limited in
the Award Agreement) by will or the laws of
descent and distribution (or, in the case of an
Award of Restricted Securities, to Olin);
provided, however, that, if so determined by the
Committee, a Participant may, in the manner
established by the Committee, designate a
beneficiary or beneficiaries with respect to any
Award to exercise the rights of the Participant,
and to receive any property distributable, upon
the death of the Participant. Each Award, and
each right under any Award, shall be
exercisable, during the Participant's lifetime,
only by the Participant or, if permissible under
applicable law by the Participant's guardian or
legal representative. No Award (other than
Released Securities), and no right under any
such Award, may be pledged, attached or
otherwise encumbered other than in favor of
Olin, and any purported pledge, attachment, or
encumbrance thereof other than in favor of Olin
shall be void and unenforceable against Olin or
any Affiliate.
(vi) Term of Awards. Except as otherwise
expressly provided in the Plan, the term of each
Award shall be for such period as may be
determined by the Committee.
(vii) Rule 16b-3 Six-Month Limitations. To the
extent required in order to satisfy the
requirements for exemption under Rule 16b-3
only, any equity security offered pursuant to
the Plan may not be sold for at least six months
after acquisition (or such other period as may
be required by Rule 16b-3), except in the case
of death or disability, and any derivative
security issued pursuant to the Plan shall not
be exercisable for at least six months (or such
other period as may be required by Rule 16b-3),
except in case of death or disability. Terms
used in the preceding sentence shall, for the
purposes of such sentence only, have the
meanings, if any, assigned or attributed to them
under Rule 16b-3.
(viii) No Rights to Awards. No Salaried Employee,
Participant or other Person shall have any claim
to be granted an Award, and there is no
obligation for uniformity of treatment of
Salaried Employees, Participants or holders or
beneficiaries of Awards under the Plan. The
terms and conditions of Awards need not be the
same with respect to each recipient. The
prospective recipient of any Award under the
Plan shall not, with respect to such Award, be
deemed to have become a Participant, or to have
any rights with respect to such Award, until and
unless such recipient shall have executed an
agreement or other instrument accepting the
Award and delivered a fully executed copy
thereof to the Company, and otherwise complied
with the then applicable terms and conditions.
(ix) Delegation. Notwithstanding any provision of
the Plan to the contrary, the Committee may
delegate to one or more officers or managers of
Olin or any Affiliate, or a committee of such
officers or managers, the authority, subject to
such terms and limitations as the Committee
shall determine, to grant Awards to, or to
cancel, modify, waive rights or conditions with
respect to, alter, discontinue, suspend, or
terminate Awards held by, Salaried Employees who
are not officers or directors of Olin for
purposes of Section 16 of the Securities
Exchange Act of 1934, as amended.
(x) Withholding. Olin or any Affiliate may
withhold from any Award granted or any payment
due or transfer made under any Award or under
the Plan the amount (in cash, Shares, other
securities, other Awards, or other property) of
withholding taxes due in respect of an Award,
its exercise or any payment under such Award or
under the Plan, and take such other action as
may be necessary in the opinion of Olin or
Affiliate to satisfy all obligations for the
payment of such taxes.
(xi) Other Compensation Arrangements. Nothing
contained in the Plan shall prevent Olin or any
Affiliate from adopting or continuing in effect
other or additional compensation arrangements,
and such arrangements may be either generally
applicable or applicable only in specific cases.
(xii) No Right to Employment. The grant of an
Award shall not be construed as giving a
Participant the right to be retained in the
employ of Olin or any Affiliate. Nothing in the
Plan or any Award Agreement shall limit the
right of Olin or an Affiliate at any time to
dismiss a Participant from employment, free from
any liability or any claim under the Plan or the
Award Agreement.
(xiii) Governing Law. The validity, construction
and effect of the Plan and any rules and
regulations relating to the Plan shall be
determined in accordance with the laws of the
State of Connecticut and applicable Federal law.
(xiv) Severability. If any provision of the Plan
or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or
as to any Person or Award, or would disqualify
the Plan or any Award under any law deemed
applicable by the Committee, such provision
shall be construed or deemed amended to conform
to applicable laws, or, if it cannot be so
construed or deemed amended without, in the
determination of the Committee, materially
altering the intent of the Plan or the Award,
such
provision shall be stricken as to such
jurisdiction, Person or Award, and the remainder
of the Plan and any such Award shall remain in
full force and effect.
(xv) No Trust or Fund Created. Neither the Plan
nor any Award shall create or be construed to
create a trust or separate fund of any kind or a
fiduciary relationship between Olin or any
Affiliate and a Participant or any other Person.
To the extent that any Person acquires a right
to receive payments from Olin or any Affiliate
pursuant to an Award, such right shall be no
greater than the right of any unsecured general
creditor of Olin or any Affiliate.
(xvi) No Fractional Shares. No fractional Shares
shall be issued or delivered pursuant to the
Plan or any Award, and the Committee shall
determine whether cash, other securities or
other property shall be paid or transferred in
lieu of any fractional Shares, or whether such
fractional Shares or any rights thereto shall be
canceled, terminated or otherwise eliminated.
(xvii) Share Certificates. All certificates for
Shares or other securities delivered under the
Plan pursuant to any Award or the exercise
thereof shall be subject to such stop transfer
orders and other restrictions as the Committee
may deem advisable under the Plan or the rules,
regulations and other requirements of the
Securities and Exchange Commission, any stock
exchange upon which such Shares or other
securities are then listed, and any applicable
Federal or state securities laws, and the
Committee may cause a legend or legends to be
put on any such certificates to make appropriate
reference to such restrictions.
(xviii) Conflict with Plan. In the event of any
inconsistency or conflict between the terms of
the Plan and an Award Agreement, the terms of
the Plan shall govern.
(xix) Notwithstanding any provision in this Plan to
the contrary, Awards granted under Sections
6(c), 6(d) or 6(e) after January 1, 1994 and
designated by the Committee as being performance-
based shall have as performance measures Return
on Equity and Total Return to Shareholders. For
purposes of the Plan, "Return on Equity" shall
mean consolidated income of Olin after taxes and
before the after-tax effect of any special
charge or gain and any cumulative effect of any
change in accounting, divided by average
shareholders equity and "Total Return to
Shareholders" shall mean for the performance
period total return to shareholders of $100
worth of Shares for such period assuming
reinvestment of dividends on a quarterly basis.
The Committee shall determine the performance
goals for each such performance measure with
respect to each such Award.
Section 7. Amendment and Termination
(a) Amendments to the Plan. The Board may amend, suspend,
discontinue or terminate the Plan, including, without
limitation, any amendment, suspension, discontinuation
or termination that would impair the rights of any
Participant, or any other holder or beneficiary of any
Award theretofore granted, without the consent of any
shareholder, Participant, other holder or beneficiary of
an Award, or other Person; provided, however, that,
notwithstanding any other provision of the Plan or any
Award Agreement, without the approval of the
shareholders of Olin, no such amendment, suspension,
discontinuation or termination shall be made that would:
(i) increase the total number of Shares available
for Awards under the Plan, except as provided in
Section 4 hereof; or
(ii) permit any Award encompassing rights to
purchase Shares to be granted with per Share
purchase or exercise prices of less than the
Fair Market Value of a Share on the date of
grant thereof; and
provided further that no amendment, suspension,
discontinuation or termination (i) that would impair the
rights of such Participant, holder or beneficiary shall
be made with respect to Section 9 of the Plan after a
Change in Control, as defined therein and (ii) may
increase the amount of payment of any Award to any
Participant.
(b) Amendments to Awards. The Committee may waive any
conditions or rights with respect to, or amend, alter,
suspend, discontinue, or terminate, any unexercised
Award theretofore granted, prospectively or
retroactively, without the consent of any relevant
Participant or holder or beneficiary of an Award,
provided that no amendment, alteration, suspension,
discontinuation or termination of an Award that would
impair the rights of such Participant, holder or
beneficiary shall be made after a Change in Control, as
defined in Section 9; provided further that the
Committee may not increase the payment of any Award
granted any Participant.
(c) Adjustments of Awards Upon Certain Acquisitions. In the
event Olin or any Affiliate shall assume outstanding
employee awards or the right or obligation to make
future such awards in connection with the acquisition of
another business or another company, the Committee may
make such adjustments, not inconsistent with the terms
of the Plan, in the terms of Awards as it shall deem
appropriate.
(d) Adjustments of Awards Upon the Occurrence of Certain
Unusual or Nonrecurring Events. The Committee may make
adjustments in the terms and conditions of Awards in
recognition of unusual or nonrecurring events
(including, without limitation, the events described in
Section 4(b) hereof) affecting Olin, any Affiliate, or
the financial statements of Olin or any Affiliate, or of
changes in applicable laws, regulations, or accounting
principles, whenever the Committee determines that such
adjustments are appropriate in order to prevent dilution
or enlargement of the benefits to be made available
under the Plan.
Section 8. Additional Conditions to Enjoyment of Awards.
(a) The Committee may cancel any unexpired, unpaid or
deferred Awards if at any time the Participant is not in
compliance with all applicable provisions of the Award
Agreement, the Plan and the following conditions:
(i) A Participant shall not render services for
any organization or engage, directly or
indirectly, in any business which, in the
judgment of the Committee or, if delegated by
the Committee to the Chief Executive Officer, in
the judgment of such Officer, is or becomes
competitive with Olin or any Affiliate, or which
is or becomes otherwise prejudicial to or in
conflict with the interests of Olin or any
Affiliate. Such judgment shall be based on the
Participant's positions and responsibilities
while employed by Olin or an Affiliate, the
Participant's post-employment responsibilities
and position with the other organization or
business, the extent of past, current and
potential competition or conflict between Olin
or an Affiliate and the other organization or
business, the effect on customers, suppliers and
competitors of the Participant's assuming the
post-employment position, the guidelines
established in the then current edition of
Olin's Code of Business Conduct, and such other
considerations as are deemed relevant given the
applicable facts and circumstances. The
Participant shall be free, however, to purchase
as an investment or otherwise, stock or other
securities of such organization or business so
long as they are listed upon a recognized
securities exchange or traded over the counter,
and such investment does not represent a
substantial investment to the Participant or a
greater than 1% equity interest in the
organization or business.
(ii) Participant shall not, without prior written
authorization from Olin, disclose to anyone
outside Olin, or use in other than Olin's
business, any secret or confidential
information, knowledge or data, relating to the
business of Olin or an Affiliate in violation of
his or her agreement with Olin or the Affiliate.
(iii) A Participant, pursuant to his or her
agreement with Olin or an Affiliate, shall
disclose promptly and assign to Olin or the
Affiliate all right, title and interest in any
invention or idea, patentable or not, made or
conceived by the Participant during employment
by Olin or the Affiliate, relating in any manner
to the actual or anticipated business, research
or development work of Olin or the Affiliate and
shall do anything reasonably necessary to enable
Olin or the Affiliate to secure a patent where
appropriate in the United States and in foreign
countries.
(b) Notwithstanding any other provision of the Plan, the
Committee in its sole discretion may cancel any Award at
any time prior to the exercise thereof, if the
employment of the Participant shall be terminated, other
than by reason of death, unless the conditions in this
Section 8 are met.
(c) Failure to comply with the conditions of this Section 8
prior to, or during the six months after, any exercise,
payment or delivery pursuant to an Award shall cause the
exercise, payment or delivery to be rescinded. Olin
shall notify the Participant in writing of any such
rescission within two years after such exercise payment
or delivery and within 10 days after receiving such
notice, the Participant shall pay to Olin the amount of
any gain realized or payment received as a result of the
exercise, payment or delivery rescinded. Such payment
shall be made either in cash or by returning to Olin the
number of Shares that the Participant received in
connection with the rescinded exercise, payment or
delivery.
(d) Upon exercise, payment or delivery pursuant to an Award,
the Committee may require the Participant to certify on
a form acceptable to the Committee, that he or she is in
compliance with the terms and conditions of the Plan.
(e) Nothing herein shall be interpreted to limit the
obligations of a Participant under his or her employee
agreement or any other agreement with Olin.
Section 9. Change in Control
(a) Except as the Board or the Committee may expressly
provide otherwise prior to a Change in Control of Olin
(as defined below) and subject to the provisions of
Section 6(f)(vii) hereof, in the event of a Change in
Control of Olin:
(i) all Options and Stock Appreciation Rights
then outstanding shall become immediately and
fully exercisable, notwithstanding any provision
therein for the exercise in installments;
(ii) unless a Stock Appreciation Right shall have
already been granted with respect to an
outstanding Option, the Participant holding such
Option shall be deemed also to hold a Stock
Appreciation Right related to such Option,
exercisable in accordance with and subject to
the terms and conditions of Section 6(b) for the
number of Shares exercisable under such Option
after giving effect to such acceleration, which
Stock Appreciation Right may, but need not be,
evidenced by separate written agreement;
(iii) all restrictions and conditions of all
Restricted Stock and Restricted Stock Units then
outstanding shall be deemed satisfied as of the
date of the Change in Control; and
(iv) all Performance Awards shall become vested,
deemed earned in full and promptly paid to the
Participants, cash units in cash and phantom
stock units in the Shares represented thereby or
such other securities, property or cash as may
be deliverable in respect of Shares as a result
of a Change in Control, without regard to
payment schedules and notwithstanding that the
applicable performance cycle or retention cycle
shall not have been completed.
(b) A Change in Control of Olin shall have occurred in the
event that:
(i) Olin ceases to be publicly owned with at
least 1,000 stockholders;
(ii) a person, partnership, joint venture,
corporation or other entity, or two or more of
any of the foregoing acting as a group (or a
"person" within the meaning of Sections 13(d)(3)
and 14(d)(2) of the Securities Exchange Act of
1934, as amended (the "Act"), other than Olin, a
majority-owned subsidiary of Olin or an employee
benefit plan of Olin or such subsidiary,
become(s) the "beneficial owner" (as defined in
Rule 13d-3 under the Act) of 20% or more of the
then outstanding voting stock of Olin;
(iii) during any period of two consecutive years,
individuals who at the beginning of such period
constitute Olin's Board of Directors (together
with any new Director whose election by Olin's
Board of Directors or whose nomination for
election by Olin's shareholders, was approved by
a vote of at least two-thirds of the Directors
then still in office who either were Directors
at the beginning of such period or whose
election or nomination for election was
previously so approved) cease for any reason to
constitute a majority of the Directors then in
office; or
(iv) Olin's Board of Directors determines that a
tender offer for Olin's shares indicates a
serious intention by the offeror to acquire
control of Olin.
Section 10. Effective Date of the Plan
The Plan shall be effective as of the date of its approval
by the shareholders of Olin.
Section 11. Term of the Plan
No Award shall be granted under the Plan after April 30,
2001, but unless otherwise expressly provided in the Plan or
in an applicable Award Agreement, any Award theretofore
granted may extend beyond such date.
Exhibit 11
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Computation of Per Share Earnings (Unaudited)
(In millions)
Three Months
Ended March 31,
Primary earnings per share
1994 1993
Primary earnings:
Net income $15.3 $11.7
Less ESOP preferred dividend (1.7) (1.9)
Net income $13.6 $9.8
Primary shares:
Weighted average shares outstanding 19.2 19.1
Weighted average common share
equivalents assuming the
conversion of Series A
Conversion Preferred Stock
at the date of issuance 2.7 2.7
Primary shares 21.9 21.8
Primary net income
per common share $0.62 $0.45
Fully diluted earnings per share
Fully diluted earnings:
Net income $15.3 $11.7
Less additional ESOP contribution (0.7) (1.0)
Net income $14.6 $10.7
Fully diluted shares:
Weighted average number of common
shares outstanding and common
stock equivalents (primary) 21.9 21.8
Dilutive effect of ESOP preferred stock 1.6 1.7
Fully diluted shares 23.5 23.5
Fully diluted net income
per common share $0.62 $0.45
Exhibit 12(a)
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Computation of Ratio of Earnings to Fixed Charges (Unaudited)
(In millions)
Three Months
Ended March 31,
1994 1993
Earnings:
Income before taxes $23.9 $17.9
Add (deduct):
Income taxes of 50% owned
affiliates 0.9 0.4
Equity in losses of less
than 50% owned affiliates 1.3 1.3
Dividends received from less
than 50% owned affiliates 0.1 0.2
Interest capitalized, net of amortization(0.3) (0.8)
Fixed charges as described below 14.0 13.9
Total $39.9 $32.9
Fixed Charges:
Interest expense $10.0 $10.8
Estimated interest factor in
rent expense 4.0 3.1
Total $14.0 $13.9
Ratio of earnings to fixed charges 2.9 2.4
Exhibit 12(b)
OLIN CORPORATION AND CONSOLIDATED SUBSIDIARIES
Computation of Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends (Unaudited)
(In millions)
Three Months
Ended March 31,
1994 1993
Earnings:
Income before taxes $23.9 $17.9
Add (deduct):
Income taxes of 50% owned
affiliates 0.9 0.4
Equity in losses of less
than 50% owned affiliates 1.3 1.3
Dividends received from less
than 50% owned affiliates 0.1 0.2
Interest capitalized, net of amortization(0.3) (0.8)
Fixed charges as described below 14.0 13.9
Total $39.9 $32.9
Fixed charges and preferred stock dividends:
Interest expense $10.0 $10.8
Estimated interest factor in
rent expense 4.0 3.1
Preferred stock dividend requirement 7.0 7.0
Total $21.0 $20.9
Ratio of earnings to combined fixed charges
and preferred stock dividends 1.9 1.6
