<PAGE>
As filed with the Securities and Exchange Commission on November , 1994
Registration No. 33-
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
------------------------
FIRST BRANDS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 06-1171404
(State of Incorporation) (IRS Employer Identification No.)
83 WOOSTER HEIGHTS ROAD
P.O. BOX 1911
DANBURY, CONNECTICUT 06813-1911
(Address of principal executive offices)
FIRST BRANDS CORPORATION 1994 PERFORMANCE
STOCK OPTION AND INCENTIVE PLAN
(Full Title of Plan)
J. BRUCE IPE, ESQ.
Vice President, General Counsel
FIRST BRANDS CORPORATION
83 Wooster Heights Road
P.O. Box 1911
Danbury, CT 06813-1911
(203) 731-2305
(Name, address and telephone number of agent for service)
CALCULATION OF REGISTRATION FEE
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<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF OFFERING AGGREGATE
SECURITIES TO BE AMOUNT TO BE PRICE PER OFFERING AMOUNT OF
REGISTERED REGISTERED SHARE PRICE REGISTRATION FEE
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<S> <C> <C> <C> <C>
442,000 shs. $32.750 $14,475,500(1) $ 4,991.59(2)
Common Stock, $0.01 Par Value................ 648,000 shs. $32.375 $20,979,000(1) $ 7,234.19(3)
----------------
$12,225.78
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</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h).
(2) The fee with respect to the 442,000 shares of the Common Stock issuable
under the 1994 Performance Stock Option and Incentive Plan upon the exercise
of outstanding options is calculated on the basis of the actual per share
exercise price of such outstanding stock options.
(3) The fee with respect to 648,000 shares of the Common Stock issuable under
the 1994 Stock Option Plan is calculated on the basis of the average of the
high and low prices for the Registrant's Common Stock reported on the New
York Stock Exchange-Composite Tape on November 10, 1994.
<PAGE>
PART I
The documents containing the information concerning the First Brands
Corporation 1994 Performance Stock Option and Incentive Plan (the 'Plan') of
First Brands Corporation, a Delaware corporation, specified in Item 1 of the
Form S-8 Registration Statement under the Securities Act of 1933, are not being
filed as part of this Registration Statement in accordance with the Note to Part
I of Form S-8 Registration Statement but will be sent to eligible employees
under the Plan in accordance with Rule 428 under the Securities Act.
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<PAGE>
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by First Brands Corporation, a Delaware
corporation (the 'Corporation'), with the Securities and Exchange Commission
(the 'Commission') are incorporated in this Registration Statement by reference:
1. The Corporation's Annual Report on Form 10-K for the fiscal year ended
June 30, 1994 (the '1994 10-K');
2. The Corporation's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1994.
3. The Corporation's Current Report on Form 8-K dated August 26, 1994.
4. The description of the Corporation's Common Stock, $0.01 par value (the
'Common Stock'), contained in its Registration Statement filed under Section 12
of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'),
including all amendments and reports updating such description.
All documents subsequently filed by the Corporation with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, after the
date of this Registration Statement but prior to the filing of a post-effective
amendment to this Registration Statement which indicates that all securities
offered by this Registration Statement have been sold or which deregisters all
such securities then remaining unsold, shall be deemed to be incorporated by
reference into this Registration Statement. Each document incorporated by
reference into this Registration Statement shall be deemed to be a part of this
Registration Statement from the date of the filing of such document with the
Commission until the information contained therein is superseded or updated by
any subsequently filed document which is incorporated by reference into this
Registration Statement or by any document which constitutes part of the
prospectus relating to the Plan meeting the requirements of Section 10(a) of the
Securities Act of 1933, as amended (the 'Securities Act').
EXPERTS
The consolidated financial statements and schedules of First Brands
Corporation and subsidiaries as of June 30, 1994 and June 30, 1993 and for each
of the years in the three year period ended June 30, 1994, included in the First
Brands Corporation 1994 Annual Report on Form 10-K, have been audited by KPMG
Peat Marwick LLP, independent auditors, as set forth in their report thereon
included therein and incorporated herein by reference. The report of KPMG Peat
Marwick LLP covering the June 30, 1994
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financial statements refers to a change in the Corporation's method of
accounting for post retirement benefits other than Pensions by adopting
Statement of Financial Accounting Standards No. 106, 'Employer's Accounting for
Post Retirement Benefits other than Pensions.' Such consolidated financial
statements and schedules are incorporated herein by reference in reliance upon
such report given upon the authority of such firm as experts in accounting and
auditing.
With respect to the unaudited condensed consolidated interim financial
information of First Brands Corporation and subsidiaries for the quarter ended
September 30, 1994, incorporated by reference herein, KPMG Peat Marwick LLP has
reported that they have applied limited procedures in accordance with
professional standards for a review of such information. However, their separate
report included in First Brands Corporation's quarterly report on Form 10-Q for
the quarter ended September 30, 1994, incorporated by reference herein, states
that they did not audit and they do not express an opinion on that condensed
consolidation interim financial information. Accordingly, the degree of reliance
on their report on such information should be restricted in light of the limited
nature of the review procedures applied. KPMG Peat Marwick LLP is not subject to
the liability provisions of Section 11 of the Securities Act of 1933 for their
report on the unaudited condensed consolidated interim financial information
because such report is not considered a 'report' or a 'part' of the Registration
Statement prepared or certified by the accountant within the meaning of Sections
7 and 11 of the Securities Act of 1933.
The financial statements incorporated herein by reference to all documents
subsequently filed by First Brands Corporation pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Exchange Act, after the date of this Registration
Statement but prior to the filing of a post-effective amendment to this
Registration Statement which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold, are or will
be so incorporated in reliance upon the reports of KPMG Peat Marwick LLP, and
any other independent public accountants, relating to such financial
information, and upon the authority of such independent public accountants
as experts in accounting and auditing in giving such reports to the extent
that the particular firm has audited such financial statements and
consented to the use of their reports thereon.
ITEM 4. DESCRIPTION OF SECURITIES
The class of securities to be offered under this Registration Statement is
registered under Section 12 of the Exchange Act.
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ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The legality of the Common Stock to which this Registration Statement
relates has been passed upon for the Corporation by J. Bruce Ipe, Vice President
and General Counsel of the Corporation. Mr. Ipe is paid a salary by the
Corporation, participates in benefit plans of the Corporation, including the
Plan, and owns directly or indirectly 45,600 shares of the Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Corporation's by-laws provide for indemnification by the Corporation of
its directors and officers to the full extent permitted by the General
Corporation Law of the State of Delaware (the 'Delaware Law'). The Corporation
is empowered by Section 145 of the Delaware Law, subject to the procedures and
limitations stated therein, to indemnify any person against expenses (including
attorneys' fees), judgements, fines, and amounts paid in settlement actually and
reasonably incurred by him in connection with any threatened, pending or
completed action, suit or proceeding in which such person was or is made a party
by reason of his being or having been a director, officer, employee or agent of
the Corporation, if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the Corporation, and,
with respect to any criminal action or proceeding, if he had no reasonable cause
to believe his conduct was unlawful. The statute provides that indemnification
pursuant to its provisions is not exclusive of other rights of indemnification
to which a person may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors, or otherwise.
The Corporation maintains a liability and indemnification policy covering
officers and directors of the Corporation.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The following Exhibits are filed herewith as part of this Registration
Statement:
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Exhibit 4(a) Restated Certificate of Incorporation of the Corporation, as amended by consent
of the stockholders of the Corporation as of April 11, 1991. Incorporated by
reference to Exhibit 3.1 to Form 10-K filed by the Corporation on September 25,
1992.
</TABLE>
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<TABLE>
<S> <C>
Exhibit 4(b) By-Laws of the Corporation, as amended by consent of the stockholders of the
Corporation as of April 11, 1991. Incorporated by reference to Exhibit 3.2 to
Form 10-K filed by the Corporation on September 25, 1992.
Exhibit 4(c) First Brands Corporation 1994 Performance Stock Option and Incentive Plan.
Incorporated by reference to Exhibit A to the Definitive Proxy Statement for
Annual Meeting of Stockholders, filed by the Corporation on September 28, 1993.
Exhibit 4(d) Form of Option Agreement: Combination Time-Based and Performance-Based Vesting
Insider Form.
Exhibit 4(e) Form of Option Agreement: Combination Time-Based and Performance-Based Vesting
Non-Insider Form.
Exhibit 4(f) Form of Option Agreement: Time-Based Vesting Non-Insider Form.
Exhibit 4(g) Form of Option Agreement: Performance-Based Vesting Insider Form.
Exhibit 4(h) Form of Option Agreement: Performance-Based Vesting Non-Insider Form.
Exhibit 5 Opinion of J. Bruce Ipe, Vice President and General Counsel of the Corporation,
as to the legality of the securities being registered.
Exhibit 15 Letter re unaudited interim financial information of KPMG Peat Marwick LLP
(included in Consent of KPMG Peat Marwick LLP filed as Exhibit 23(a).
Exhibit 23(a) Consent of KPMG Peat Marwick LLP.
Exhibit 23(b) Consent of J. Bruce Ipe, Vice President and General Counsel of the Corporation,
to the use of his opinion as an exhibit to this Registration Statement (included
in his opinion filed as Exhibit 5).
</TABLE>
ITEM 9. UNDERTAKINGS
(a) The Corporation hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof)
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<PAGE>
which, individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration Statement;
(iii) To include any material information with respect to the Plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to section 13 or section 15(d)
of the Exchange Act that are incorporated by reference in the
Registration Statement;
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Corporation hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Corporation's annual
report pursuant to section 13(a) or section 15(d) of the Exchange Act that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
* * *
(h) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Corporation pursuant to the foregoing provisions, or otherwise, the Corporation
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in that Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Corporation of expenses incurred or paid by a director,
officer or controlling person of the Corporation in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Corporation will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
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<PAGE>
SIGNATURES
THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933,
as amended, the Corporation certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Danbury, State of Connecticut, on
October 28, 1994.
FIRST BRANDS CORPORATION
By /s/ Donald A. DeSantis
...................................
Donald A. DeSantis
Senior Vice President, Chief
Financial Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities shown and on the dates indicated.
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Signature Title Date
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<S> <C> <C>
/s/ Alan C. Egler
......................................... Director October 28, 1994
Alan C. Egler
/s/ James R. Maher
......................................... Director October 28, 1994
James R. Maher
/s/ Dwight C. Minton
......................................... Director October 28, 1994
Dwight C. Minton
/s/ Denis Newman
......................................... Director October 28, 1994
Denis Newman
/s/ Ervin R. Shames
......................................... Director October 28, 1994
Ervin R. Shames
</TABLE>
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<TABLE>
<CAPTION>
Signature Title Date
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<S> <C> <C>
/s/ Gary E. Gardner
......................................... Director October 28, 1994
Gary E. Gardner
/s/ James R. Mcmanus
......................................... Director October 28, 1994
James R. Mcmanus
/s/ Alfred E. Dudley
......................................... Chairman and Director October 28, 1994
Alfred E. Dudley
/s/ William V. Stephenson
......................................... President, Chief Executive Officer and Director October 28, 1994
William V. Stephenson (Principal Executive Officer)
/s/ Donald A. Desantis
......................................... Senior Vice President, Chief Financial Officer October 28, 1994
Donald A. Desantis and Treasurer (Principal Financial and
Accounting Officer)
</TABLE>
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<PAGE>
EXHIBIT 4(d)
9/8/94
COMBINATION TIME-BASED AND
PERFORMANCE-BASED VESTING
INSIDER FORM
FIRST BRANDS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 9th day of August, 1994, by and between
FIRST BRANDS CORPORATION (the 'Company'), a Delaware corporation having its
headquarters in Danbury, Connecticut,
and
, an employee of the Company
('Optionee').
ARTICLE 1
RECITALS
1.1 Optionee is an employee of the Company, and the Company desires to
provide Optionee with an increased incentive to achieve long-range corporate
objectives and to participate in the long-term growth and financial success of
the Company.
1.2 In order to provide such an increased incentive to its employees, the
Company has adopted the First Brands Corporation 1994 Performance Stock Option
and Incentive Plan (the 'Plan').
1.3 The Company desires to grant to Optionee under the Plan stock options
that do not qualify as 'incentive stock options' within the meaning of Section
422 or any successor provision of the Internal Revenue Code of 1986, as amended
(the 'Code').
1.4 The terms of the Plan are incorporated by reference herein in their
entirety, and capitalized terms used in this Agreement, unless otherwise defined
herein, shall have the respective meanings given to such terms in the Plan.
ARTICLE 2
OPTION GRANT
2.1 Grant. The Company hereby grants to Optionee, subject to the provisions
of this Agreement, the right and option to purchase up to, but not exceeding in
the aggregate,
<PAGE>
shares of the Common Stock of the Company, par value $.01 per share (the 'Common
Stock'), for the period beginning on August 9, 1994 and ending on August 8, 2004
(the 'Option Term'), at the option price of $32.750 per share.
2.2 Nonqualified Options. The options granted hereunder (the 'Options')
shall be Nonqualified Options and are not intended to qualify as 'incentive
stock options' within the meaning of Section 422 of the Code.
ARTICLE 3
EXERCISE AND WITHHOLDING
3.1 (a) Vesting. The Options shall consist of two portions, a time-based
portion in respect of shares of Common Stock (the 'Time-Based Portion')
and a performance-based portion in respect of the remaining shares of
Common Stock (the 'Performance-Based Portion'). The Time-Based Portion shall
become exercisable ('vest') on August 8, 1996. The Performance-Based Portion
shall vest upon the earlier of (i) the last day of the first period of ten
consecutive trading days following the date hereof during which the Fair Market
Value per share exceeds $42.00 or (ii) August 8, 2003. There will not be any
partial vesting of either the Time-Based Portion or the Performance-Based
Portion prior to the respective vesting dates set forth above.
(b) Acceleration of Vesting. All Options shall become immediately
exercisable (i) upon the death, Disability or Retirement of Optionee, and (ii)
upon the occurrence of a Change of Control of the Company.
(c) Restriction on Vesting. Except in the case of the death or Disability
of Optionee, no part of the Options shall vest until at least six months have
elapsed after the date of this Agreement.
(d) Exercise. Once Options have vested, they may be exercised at any time
and from time to time during the Option Term (except as set forth in Article 4
hereof).
3.2 Method of Exercise. Options shall be exercised by Optionee by
delivering to the Company a Notice in the form set forth as Exhibit A hereto,
together with a check payable to the order of the Company and/or shares of
Common Stock, with a stock power executed in blank, equal in value to the option
price of the shares being purchased. Shares of Common Stock surrendered in
exercise of all of any portion of the Option shall be valued at their Fair
Market Value on the date of exercise. Active employees may also use the
'Cashless Exercise Program' which was
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announced to Optionees on June 11, 1991. A copy is attached as Exhibit B to this
Agreement.
3.3 Compliance with Securities Laws. Optionee shall deliver to the Company
at the time all or any portion of the Options is exercised any additional
evidence as the Company may deem necessary to establish that such exercise is in
compliance with all applicable securities laws.
3.4 (a) Tax Withholding. The Company shall notify Optionee of the amount of
withholding tax, if any, which must be paid under federal and, where applicable,
state and local law upon exercise of Options. The Company shall have the right
to require Optionee to pay such withholding taxes in either of the following two
ways:
(i) Cash. Such payment may be made in cash, through withholding from
Optionee's salary or otherwise, or
(ii) Common Stock. At the election of Optionee, subject to the
approval of the Compensation Committee of the Board of Directors of the
Company (the 'Committee'), such payment may be made, in whole or in part,
in shares of Common Stock.
(b) Payment in Shares of Common Stock. Payment of withholding taxes in
shares of Common Stock may be made in any of the following three ways, at the
election of Optionee, subject to the approval of the Committee, and compliance
with such limitations, conditions and restrictions as the Committee may impose,
or by a combination of any of such ways:
(i) Surrender of Options. Optionee may have shares withheld from
shares otherwise issuable to Optionee in connection with the exercise of
all or any portion of the Options;
(ii) Previously Acquired Shares. Optionee may deliver previously
acquired shares to the Company prior to transfer to Optionee of shares
issuable in connection with the exercise of all or any portion of the
Options; or
(iii) Tender Back of Shares. Optionee may tender back shares to the
Company from shares issued to Optionee in connection with the exercise of
all or any portion of the Options.
(c) Valuation. Shares so withheld, delivered or tendered back shall be
valued at their Fair Market Value on the date on which the amount of tax to be
withheld is determined (the 'Tax Date'). The tax withholding obligations that
may be paid by such withholding of shares otherwise issuable in connection with
3
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the exercise of all or any portion of the Options or the delivery of shares held
less than six months may not exceed the minimum withholding requirements imposed
by law. The tax withholding obligations
that may be paid by the delivery or tender back of shares held by the Optionee
for six months or longer may exceed the Optionee's tax obligations associated
with the transaction, including any related FICA obligations, determined based
upon the Optionee's maximum marginal tax rate. Solely for the purposes of this
Section 3.4(c), the six-month period with respect to any restricted stock
granted under the Plan or the Company's 1989 Long-Term Incentive Plan and used
by Optionee to pay a tax withholding obligation shall begin upon the lapse of
the applicable restrictions.
(d) Election. Optionee's election to have withheld shares of Common stock
that are otherwise issuable, or to deliver or tender back shares, shall be in
writing, shall be irrevocable and shall be delivered to the Company prior to the
Tax Date. Such election shall be subject to the approval of the Committee. If
Optionee is subject to the short-swing profit rules of Section 16(b) of the
Securities Exchange Act of 1934, as amended (the 'Exchange Act'), such election
(i) shall, unless otherwise approved by the Committee, be delivered to the
Company (x) at least six months prior to the Tax Date or (y) during a 'window'
period as described in Rule 16b-3(e)(3) under the Exchange Act, and (ii) shall
not be made within six months after the grant of the Options, except that this
limitation shall not apply in the event Optionee dies or becomes Disabled prior
to the expiration of such six-month period.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1 Termination for Reasons Other than Disability, Retirement or Death. If
Optionee's employment by the Company shall terminate for any reason other than
Disability or Retirement, or death, all Options which are unexercised on the
date of termination of employment shall expire and cease to be exercisable on
the earlier of (i) sixty days following the date of such termination of
employment, or (ii) the expiration of the Option Term. The Committee, in its
sole discretion, may notify Optionee prior to the date of expiration of such
Options that any or all of such Options shall remain exercisable for a
particular period of time following such date.
4.2 Retirement. Upon Optionee's Retirement, all Options may be exercised at
any time and from time to time for a period ending on the earlier of (i) two
years following the date of Optionee's Retirement or (ii) the expiration of the
Option Term.
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4.3 Death. Upon Optionee's death, Optionee's executors, administrators, or
any person or persons to whom Options have been transferred by will or by the
laws of descent and distribution, shall have the right at any time and from time
to time to exercise such Options for a period ending on the earlier of (i) two
years following the date of Optionee's death or (ii) the expiration of the
Option Term.
4.4 Disability. Upon Optionee's Disability, all Options may be exercised at
any time and from time to time by Optionee or his guardian or legal
representative for a period ending on the earlier of (i) two years from the date
such Disability occurred, or (ii) the expiration of the Option Term.
ARTICLE 5
LIMITED STOCK APPRECIATION RIGHTS
5.1 Grant. The Company hereby grants to Optionee, in tandem with the
options granted under Article 2 hereof, limited stock appreciation rights
('LSARs') with respect to that number of shares of the Common Stock as to which
options are granted under Article 2 hereof.
5.2 Exercise. Upon the occurrence of a Change of Control of the Company (as
hereinafter defined), all LSARs granted more than six months prior to such
Change of Control shall immediately and without any action or discretion on the
part of Optionee, be exercised. Upon the exercise of an LSAR, the option to
which such LSAR relates shall terminate and shall no longer be exercisable.
5.3 Payment. The exercise of an LSAR shall entitle Optionee to receive from
the Company an amount equal to the excess of the Fair Market Value (as defined
in the Plan) on the date of such exercise of a share of the Common Stock of the
Company and the option price of the option to which such LSAR relates. Such
amount shall be paid by the Company to Optionee in cash on or promptly following
the date of exercise of the LSAR.
5.4 Change of Control. For the purposes hereof, 'Change of Control' shall
mean (i) a merger of the Company into or with another entity, other than a
merger in which the former stockholders of the Company own immediately following
the transaction more than 50% of the total combined voting rights of all classes
of stock of the surviving entity having voting rights or convertible into stock
having voting rights; (ii) the sale or other disposition of all or substantially
all of the assets of the Company; (iii) the sale or other disposition (except by
means of a registered public offering of the Common Stock of the Company on a
form other than Form S-4 or any successor form) of
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<PAGE>
an amount of stock comprising more than 50% of the total combined voting rights
of all classes of stock having voting rights or convertible into stock having
voting rights; (iv) the liquidation or dissolution of the Company; or (v) a
change in the composition of the Board of Directors of the Company such that at
any time a majority of the Board of Directors have been members of the Board of
Directors for less than twenty-four months, and the appointment or election of
such new members of the Board of Directors was not endorsed by at least
three-fourths of the directors who were members of the Board of Directors at the
beginning of such twenty-four month period.
ARTICLE 6
MISCELLANEOUS
6.1 Change in Common Stock. In the event of any change in the outstanding
shares of the Common Stock of the Company by reason of any stock split, stock
dividend, recapitalization, reclassification, spin-off, merger, consolidation,
combination or exchange of shares or other similar corporate change, or in the
event of any special distribution to stockholders (other than a normal cash
dividend), then the Committee shall make such adjustment or substitution in the
kind and number of shares and prices per share applicable to the Options as the
Committee determines to be equitable and appropriate.
6.2 No Rights as Stockholder. Nothing contained in this Agreement or in the
Plan shall be deemed to confer upon Optionee any right to prevent or to approve
or vote upon any of the corporate actions described in this Article 6. The
existence of the Options shall not affect in any way the right or the power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. Optionee shall not be deemed for any purpose to
be a stockholder of the Company in respect of any shares as to which Options
shall not have been exercised as herein provided, and until such shares have
been issued to Optionee by the Company hereunder.
6.3 Optionee. Whenever the word 'Optionee' is used in any provision of this
Agreement under circumstances where the provision should logically be construed
to apply to the executors, the administrators, or the person or persons to whom
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options may be transferred by will or by the laws of descent and distribution,
the word 'Optionee' shall be deemed to include such person or persons.
6.4 No Transferability. The Options are not transferable by Optionee
otherwise than by will or the laws of descent and distribution and are
exercisable during Optionee's lifetime only by him or his guardian or legal
representative. No assignment or transfer of the Options, or of the rights
represented thereby, whether voluntary or involuntary, by the operation of law
or otherwise (except by will or the laws of descent and distribution), shall
vest in the assignee or transferee any interest or right herein whatsoever, but
immediately upon any such assignment or transfer, the Options shall terminate
and become of no further effect.
6.5 No Right to Employment. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in the employ of the Company or shall
affect the right of the Company to terminate the employment of Optionee with or
without cause.
6.6 Registration of Shares Under Plan. The Company shall register the
shares reserved for issuance under the Plan on a Form S-8 or any successor form
promulgated by the Securities and Exchange Commission and shall maintain the
effectiveness of such registration unless the Committee determines that
maintaining such effectiveness would be impracticable or materially adverse to
the interests of the Company.
6.7 Notices. Every notice or other communication relating to this Agreement
shall be in writing and shall be mailed to or delivered to the party for whom it
is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided; provided,
however, that unless and until some other address be so designated, all notices
or communications by Optionee to the Company shall be mailed or delivered to the
Company at its office at 83 Wooster Heights Road, Danbury, Connecticut 06813,
and all notices or communications by the Company to Optionee may be given to
Optionee personally or may be mailed to him.
6.8 Entire Agreement. This Agreement represents the entire agreement of the
parties with respect to the subject matter hereof. The Agreement may be amended
at any time by written agreement of the parties hereto.
6.9 Governing Law. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the State of
Delaware other than the conflict of laws provisions of such laws.
7
<PAGE>
6.10 Severability. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with the law continue in full force and effect. If any
provision of this Agreement shall be held invalid in part, such invalidity shall
in no way affect the rest of such provision not held so invalid, and the rest of
such provision, together with all other provisions of this Agreement, shall to
the full extent consistent with law continue in full force and effect.
6.11 Effect on Other Plans. Income realized by Optionee pursuant to this
Agreement shall not be included in Optionee's earnings for the purpose of any
benefit plan of the Company in which Optionee may be enrolled or for which
Optionee may become eligible unless otherwise specifically provided for in such
plan.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
<TABLE>
<S> <C>
OPTIONEE: FIRST BRANDS CORPORATION
...................................... By ..............................
Secretary
</TABLE>
8
<PAGE>
EXHIBIT A
EXERCISE OF STOCK OPTION
FIRST BRANDS 1994 PERFORMANCE STOCK OPTION AND INCENTIVE PLAN
Pursuant to the provisions of the Stock Option Agreement entered into as of
August 9, 1994, between First Brands Corporation (the 'Company') and
, Optionee, I hereby exercise the nonqualified stock option
granted under the terms of this Agreement to the extent of shares of
the Common Stock of the Company subject to the Time-Based Portion and/or
shares of Common Stock of the Company subject to the Performance-Based Portion,
for a total of shares (the 'Shares'). I deliver to you herewith the
following in payment for the Shares:
$ in cash
Stock certificates for shares of Common Stock of the Company
Cashless Exercise Program
<TABLE>
<S> <C>
Date: ................................ ..................................
Optionee
..................................
Address
..................................
Social Security Number
</TABLE>
<PAGE>
EXHIBIT B
FIRST BRANDS CORPORATION
CASHLESS EXERCISE OF STOCK OPTIONS
Participants in the First Brands Stock Option Programs who are actively
employed may sell option shares without tendering cash or existing shares in
advance for payment of the option price to the Company. In this process,
participants essentially assign the rights to sell their option shares to Lehman
Brothers who in return are required to pay the proceeds to First Brands. The
Company then uses our payroll system to withhold applicable federal, state and
local taxes, brokerage and transaction fees. The option price is deducted from
the proceeds and the optionee receives a check from the Cashier's Department.
To initiate a transaction under this procedure the optionee must execute
two forms (which are available from Lisa Hull, Shareholder Relations
Administrator, in Danbury, extension 2581) by 12:00 noon on the date the option
is to be exercised. Forms received after 12:00 noon will be processed in the
next day's trading. All option shares sold will be at the current market price
at the time of the sale. Proceeds will be paid to the optionee after the funds
have cleared the brokerage accounts and have been wired to the Company.
Brokerage fees charged by Lehman Brothers will be at their discounted rates.
If you have any questions about this procedure or would like to request
exercise forms, please call Lisa Hull in Danbury on extension 2581.
<PAGE>
EXHIBIT 4(e)
9/8/94
COMBINATION TIME-BASED AND
PERFORMANCE-BASED VESTING
NON-INSIDER FORM
FIRST BRANDS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 9th day of August, 1994, by and between
FIRST BRANDS CORPORATION (the 'Company'), a Delaware corporation having its
headquarters in Danbury, Connecticut,
and
, an employee of the Company
('Optionee').
ARTICLE 1
RECITALS
1.1 Optionee is an employee of the Company, and the Company desires to
provide Optionee with an increased incentive to achieve long-range corporate
objectives and to participate in the long-term growth and financial success of
the Company.
1.2 In order to provide such an increased incentive to its employees, the
Company has adopted the First Brands Corporation 1994 Performance Stock Option
and Incentive Plan (the 'Plan').
1.3 The Company desires to grant to Optionee under the Plan stock options
that do not qualify as 'incentive stock options' within the meaning of Section
422 or any successor provision of the Internal Revenue Code of 1986, as amended
(the 'Code').
1.4 The terms of the Plan are incorporated by reference herein in their
entirety, and capitalized terms used in this Agreement, unless otherwise defined
herein, shall have the respective meanings given to such terms in the Plan.
ARTICLE 2
OPTION GRANT
2.1 Grant. The Company hereby grants to Optionee, subject to the provisions
of this Agreement, the right and option to
<PAGE>
purchase up to, but not exceeding in the aggregate, shares of the
Common Stock of the Company, par value $.01 per share (the 'Common Stock'), for
the period beginning on August 9, 1994 and ending on August 8, 2004 (the 'Option
Term'), at the option price of $32.750 per share.
2.2 Nonqualified Options. The options granted hereunder (the 'Options')
shall be Nonqualified Options and are not intended to qualify as 'incentive
stock options' within the meaning of Section 422 of the Code.
ARTICLE 3
EXERCISE AND WITHHOLDING
3.1 (a) Vesting. The Options shall consist of two portions, a time-based
portion in respect of shares of Common Stock (the 'Time-Based
Portion') and a performance-based portion in respect of the remaining
shares of Common Stock (the 'Performance-Based Portion'). The
Time-Based Portion shall become exercisable ('vest') on August 8, 1996. The
Performance-Based Portion shall vest upon the earlier of (i) the last day of the
first period of ten consecutive trading days following the date hereof during
which the Fair Market Value per share exceeds $42.00 or (ii) August 8, 2003.
There will not be any partial vesting of either the Time-Based Portion or the
Performance-Based Portion prior to the respective vesting dates set forth above.
(b) Acceleration of Vesting. All Options shall become immediately
exercisable (i) upon the death, Disability or Retirement of Optionee, and (ii)
upon the occurrence of a Change of Control of the Company.
(c) Exercise. Once Options have vested, they may be exercised at any time
and from time to time during the Option Term (except as set forth in Article 4
hereof).
3.2 Method of Exercise. Options shall be exercised by Optionee by
delivering to the Company a Notice in the form set forth as Exhibit A hereto,
together with a check payable to the order of the Company and/or shares of
Common Stock, with a stock power executed in blank, equal in value to the option
price of the shares being purchased. Shares of Common Stock surrendered in
exercise of all of any portion of the Option shall be valued at their Fair
Market Value on the date of exercise. Active employees may also use the
'Cashless Exercise Program' which was announced to Optionees on June 11, 1991. A
copy is attached as Exhibit B to this Agreement.
2
<PAGE>
3.3 Compliance with Securities Laws. Optionee shall deliver to the Company
at the time all or any portion of the Options is exercised any additional
evidence as the Company may deem necessary to establish that such exercise is in
compliance with all applicable securities laws.
3.4 (a) Tax Withholding. The Company shall notify Optionee of the amount of
withholding tax, if any, which must be paid under federal and, where applicable,
state and local law upon exercise of Options. The Company shall have the right
to require Optionee to pay such withholding taxes in either of the following two
ways:
(i) Cash. Such payment may be made in cash, through withholding from
Optionee's salary or otherwise, or
(ii) Common Stock. At the election of Optionee, subject to the
approval of the Compensation Committee of the Board of Directors of the
Company (the 'Committee'), such payment may be made, in whole or in part,
in shares of Common Stock.
(b) Payment in Shares of Common Stock. Payment of withholding taxes in
shares of Common Stock may be made in any of the following three ways, at the
election of Optionee, subject to the approval of the Committee, and compliance
with such limitations, conditions and restrictions as the Committee may impose,
or by a combination of any of such ways:
(i) Surrender of Options. Optionee may have shares withheld from
shares otherwise issuable to Optionee in connection with the exercise of
all or any portion of the Options;
(ii) Previously Acquired Shares. Optionee may deliver previously
acquired shares to the Company prior to transfer to Optionee of shares
issuable in connection with the exercise of all or any portion of the
Options; or
(iii) Tender Back of Shares. Optionee may tender back shares to the
Company from shares issued to Optionee in connection with the exercise of
all or any portion of the Options.
(c) Valuation. Shares so withheld, delivered or tendered back shall be
valued at their Fair Market Value on the date on which the amount of tax to be
withheld is determined (the 'Tax Date'). The tax withholding obligations that
may be paid by such withholding of shares otherwise issuable in connection with
the exercise of all or any portion of the Options or the delivery of shares held
less than six months may not exceed the minimum withholding requirements imposed
by law. The tax withholding
3
<PAGE>
obligations that may be paid by the delivery or tender back of shares held by
the Optionee for six months or longer may exceed the Optionee's tax obligations
associated with the transaction, including any related FICA obligations,
determined based upon the Optionee's maximum marginal tax rate. Solely for the
purposes of this Section 3.4(c), the six-month period with respect to any
restricted stock granted under the Plan or the Company's 1989 Long-Term
Incentive Plan and used by Optionee to pay a tax withholding obligation shall
begin upon the lapse of the applicable restrictions.
(d) Election. Optionee's election to have withheld shares of Common stock that
are otherwise issuable, or to deliver or tender back shares, shall be in
writing, shall be irrevocable and shall be delivered to the Company prior to the
Tax Date. Such election shall be subject to the approval of the Committee.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1 Termination for Reasons Other than Disability, Retirement or Death. If
Optionee's employment by the Company shall terminate for any reason other than
Disability or Retirement, or death, all Options which are unexercised on the
date of termination of employment shall expire and cease to be exercisable on
the earlier of (i) sixty days following the date of such termination of
employment, or (ii) the expiration of the Option Term. The Committee, in its
sole discretion, may notify Optionee prior to the date of expiration of such
Options that any or all of such Options shall remain exercisable for a
particular period of time following such date.
4.2 Retirement. Upon Optionee's Retirement, all Options may be exercised at
any time and from time to time for a period ending on the earlier of (i) two
years following the date of Optionee's Retirement or (ii) the expiration of the
Option Term.
4.3 Death. Upon Optionee's death, Optionee's executors, administrators, or
any person or persons to whom Options have been transferred by will or by the
laws of descent and distribution, shall have the right at any time and from time
to time to exercise such Options for a period ending on the earlier of (i) two
years following the date of Optionee's death or (ii) the expiration of the
Option Term.
4.4 Disability. Upon Optionee's Disability, all Options may be exercised at
any time and from time to time by Optionee or his guardian or legal
representative for a period ending on the earlier of (i) two years from the date
such Disability occurred, or (ii) the expiration of the Option Term.
4
<PAGE>
ARTICLE 5
MISCELLANEOUS
5.1 Change in Common Stock. In the event of any change in the outstanding
shares of the Common Stock of the Company by reason of any stock split, stock
dividend, recapitalization, reclassification, spin-off, merger, consolidation,
combination or exchange of shares or other similar corporate change, or in the
event of any special distribution to stockholders (other than a normal cash
dividend), then the Committee shall make such adjustment or substitution in the
kind and number of shares and prices per share applicable to the Options as the
Committee determines to be equitable and appropriate.
5.2 No Rights as Stockholder. Nothing contained in this Agreement or in the
Plan shall be deemed to confer upon Optionee any right to prevent or to approve
or vote upon any of the corporate actions described in this Article 6. The
existence of the Options shall not affect in any way the right or the power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. Optionee shall not be deemed for any purpose to
be a stockholder of the Company in respect of any shares as to which Options
shall not have been exercised as herein provided, and until such shares have
been issued to Optionee by the Company hereunder.
5.3 Optionee. Whenever the word 'Optionee' is used in any provision of this
Agreement under circumstances where the provision should logically be construed
to apply to the executors, the administrators, or the person or persons to whom
options may be transferred by will or by the laws of descent and distribution,
the word 'Optionee' shall be deemed to include such person or persons.
5.4 No Transferability. The Options are not transferable by Optionee
otherwise than by will or the laws of descent and distribution and are
exercisable during Optionee's lifetime only by him or his guardian or legal
representative. No assignment or transfer of the Options, or of the rights
represented thereby, whether voluntary or involuntary, by the operation of law
or otherwise (except by will or the laws of descent and distribution), shall
vest in the assignee or transferee any
5
<PAGE>
interest or right herein whatsoever, but immediately upon any such assignment or
transfer, the Options shall terminate and become of no further effect.
5.5 No Right to Employment. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in the employ of the Company or shall
affect the right of the Company to terminate the employment of Optionee with or
without cause.
5.6 Registration of Shares Under Plan. The Company shall register the
shares reserved for issuance under the Plan on a Form S-8 or any successor form
promulgated by the Securities and Exchange Commission and shall maintain the
effectiveness of such registration unless the Committee determines that
maintaining such effectiveness would be impracticable or materially adverse to
the interests of the Company.
5.7 Notices. Every notice or other communication relating to this Agreement
shall be in writing and shall be mailed to or delivered to the party for whom it
is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided; provided,
however, that unless and until some other address be so designated, all notices
or communications by Optionee to the Company shall be mailed or delivered to the
Company at its office at 83 Wooster Heights Road, Danbury, Connecticut 06813,
and all notices or communications by the Company to Optionee may be given to
Optionee personally or may be mailed to him.
5.8 Entire Agreement. This Agreement represents the entire agreement of the
parties with respect to the subject matter hereof. The Agreement may be amended
at any time by written agreement of the parties hereto.
5.9 Governing Law. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the State of
Delaware other than the conflict of laws provisions of such laws.
5.10 Severability. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with the law continue in full force and effect. If any
provision of this Agreement shall be held invalid in part, such invalidity shall
in no way affect the rest of such provision not held so invalid, and the rest of
such provision, together with all other provisions of this Agreement, shall to
the full extent consistent with law continue in full force and effect.
5.11 Effect on Other Plans. Income realized by Optionee pursuant to this
Agreement shall not be included in Optionee's
6
<PAGE>
earnings for the purpose of any benefit plan of the Company in which Optionee
may be enrolled or for which Optionee may become eligible unless otherwise
specifically provided for in such plan.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first above written.
<TABLE>
<S> <C>
OPTIONEE: FIRST BRANDS CORPORATION
...................................... By ..............................
Secretary
</TABLE>
7
<PAGE>
EXHIBIT A
EXERCISE OF STOCK OPTION
FIRST BRANDS 1994 PERFORMANCE STOCK OPTION AND INCENTIVE PLAN
Pursuant to the provisions of the Stock Option Agreement entered into as of
August 9, 1994, between First Brands Corporation (the 'Company') and
, Optionee, I hereby exercise the nonqualified stock option
granted under the terms of this Agreement to the extent of shares of
the Common Stock of the Company subject to the Time-Based Portion and/or
shares of Common Stock of the Company subject to the Performance-Based Portion,
for a total of shares (the 'Shares'). I deliver to you herewith the
following in payment for the Shares:
$ in cash
Stock certificates for shares of Common Stock of the Company
Cashless Exercise Program
<TABLE>
<S> <C>
Date: ................................ ..................................
Optionee
..................................
Address
..................................
Social Security Number
</TABLE>
<PAGE>
EXHIBIT B
FIRST BRANDS CORPORATION
CASHLESS EXERCISE OF STOCK OPTIONS
Participants in the First Brands Stock Option Programs who are actively
employed may sell option shares without tendering cash or existing shares in
advance for payment of the option price to the Company. In this process,
participants essentially assign the rights to sell their option shares to Lehman
Brothers who in return are required to pay the proceeds to First Brands. The
Company then uses our payroll system to withhold applicable federal, state and
local taxes, brokerage and transaction fees. The option price is deducted from
the proceeds and the optionee receives a check from the Cashier's Department.
To initiate a transaction under this procedure the optionee must execute
two forms (which are available from Lisa Hull, Shareholder Relations
Administrator, in Danbury, extension 2581) by 12:00 noon on the date the option
is to be exercised. Forms received after 12:00 noon will be processed in the
next day's trading. All option shares sold will be at the current market price
at the time of the sale. Proceeds will be paid to the optionee after the funds
have cleared the brokerage accounts and have been wired to the Company.
Brokerage fees charged by Lehman Brothers will be at their discounted rates.
If you have any questions about this procedure or would like to request
exercise forms, please call Lisa Hull in Danbury on extension 2581.
<PAGE>
<PAGE>
EXHIBIT 4(f)
9/8/94
TIME-BASED VESTING
NON-INSIDER FORM
FIRST BRANDS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 9th day of August, 1994, by and between
FIRST BRANDS CORPORATION (the 'Company'), a Delaware corporation having its
headquarters in Danbury, Connecticut,
and
, an employee of the Company
('Optionee').
ARTICLE 1
RECITALS
1.1 Optionee is an employee of the Company, and the Company desires to
provide Optionee with an increased incentive to achieve long-range corporate
objectives and to participate in the long-term growth and financial success of
the Company.
1.2 In order to provide such an increased incentive to its employees, the
Company has adopted the First Brands Corporation 1994 Performance Stock Option
and Incentive Plan (the 'Plan').
1.3 The Company desires to grant to Optionee under the Plan stock options
that do not qualify as 'incentive stock options' within the meaning of Section
422 or any successor provision of the Internal Revenue Code of 1986, as amended
(the 'Code').
1.4 The terms of the Plan are incorporated by reference herein in their
entirety, and capitalized terms used in this Agreement, unless otherwise defined
herein, shall have the respective meanings given to such terms in the Plan.
ARTICLE 2
OPTION GRANT
2.1 GRANT. The Company hereby grants to Optionee, subject to the provisions
of this Agreement, the right and option to
<PAGE>
purchase up to, but not exceeding in the aggregate, shares of the
Common Stock of the Company, par value $.01 per share (the 'Common Stock'), for
the period beginning on August 9, 1994 and ending on August 8, 2004 (the 'Option
Term'), at the option price of $32.750 per share.
2.2 NONQUALIFIED OPTIONS. The options granted hereunder (the 'Options')
shall be Nonqualified Options and are not intended to qualify as 'incentive
stock options' within the meaning of Section 422 of the Code.
ARTICLE 3
EXERCISE AND WITHHOLDING
3.1 (a) VESTING. The Options shall become exercisable ('vest') on August 8,
1996. There will not be any partial vesting of the Options prior to such date.
(b) ACCELERATION OF VESTING. All Options shall become immediately
exercisable (i) upon the death, Disability or Retirement of Optionee, and (ii)
upon the occurrence of a Change of Control of the Company.
(c) EXERCISE. Once Options have vested, they may be exercised at any
time and from time to time during the Option Term (except as set forth in
Article 4 hereof).
3.2 METHOD OF EXERCISE. Options shall be exercised by Optionee by
delivering to the Company a Notice in the form set forth as Exhibit A hereto,
together with a check payable to the order of the Company and/or shares of
Common Stock, with a stock power executed in blank, equal in value to the option
price of the shares being purchased. Shares of Common Stock surrendered in
exercise of all of any portion of the Option shall be valued at their Fair
Market Value on the date of exercise. Active employees may also use the
'Cashless Exercise Program' which was announced to Optionees on June 11, 1991. A
copy is attached as Exhibit B to this Agreement.
3.3 COMPLIANCE WITH SECURITIES LAWS. Optionee shall deliver to the Company
at the time all or any portion of the Options is exercised any additional
evidence as the Company may deem necessary to establish that such exercise is in
compliance with all applicable securities laws.
3.4 (a) TAX WITHHOLDING. The Company shall notify Optionee of the amount of
withholding tax, if any, which must be paid under federal and, where applicable,
state and local law upon exercise of Options. The Company shall have the right
to
2
<PAGE>
require Optionee to pay such withholding taxes in either of the following two
ways:
(i) CASH. Such payment may be made in cash, through withholding from
Optionee's salary or otherwise, or
(ii) COMMON STOCK. At the election of Optionee, subject to the
approval of the Compensation Committee of the Board of Directors of the
Company (the 'Committee'), such payment may be made, in whole or in part,
in shares of Common Stock.
(b) PAYMENT IN SHARES OF COMMON STOCK. Payment of withholding taxes in
shares of Common Stock may be made in any of the following three ways, at the
election of Optionee, subject to the approval of the Committee, and compliance
with such limitations, conditions and restrictions as the Committee may impose,
or by a combination of any of such ways:
(i) SURRENDER OF OPTIONS. Optionee may have shares withheld from
shares otherwise issuable to Optionee in connection with the exercise of
all or any portion of the Options;
(ii) PREVIOUSLY ACQUIRED SHARES. Optionee may deliver previously
acquired shares to the Company prior to transfer to Optionee of shares
issuable in connection with the exercise of all or any portion of the
Options; or
(iii) TENDER BACK OF SHARES. Optionee may tender back shares to the
Company from shares issued to Optionee in connection with the exercise of
all or any portion of the Options.
(c) VALUATION. Shares so withheld, delivered or tendered back shall be
valued at their Fair Market Value on the date on which the amount of tax to be
withheld is determined (the 'Tax Date'). The tax withholding obligations that
may be paid by such withholding of shares otherwise issuable in connection with
the exercise of all or any portion of the Options or the delivery of shares held
less than six months may not exceed the minimum withholding requirements imposed
by law. The tax withholding obligations that may be paid by the delivery or
tender back of shares held by the Optionee for six months or longer may exceed
the Optionee's tax obligations associated with the transaction, including any
related FICA obligations, determined based upon the Optionee's maximum marginal
tax rate. Solely for the purposes of this Section 3.4(c), the six-month period
with respect to any restricted stock granted under the Plan or the Company's
1989 Long-Term Incentive Plan and used by Optionee to pay a tax withholding
obligation shall begin upon the lapse of the applicable restrictions.
3
<PAGE>
(d) ELECTION. Optionee's election to have withheld shares of Common stock
that are otherwise issuable, or to deliver or tender back shares, shall be in
writing, shall be irrevocable and shall be delivered to the Company prior to the
Tax Date. Such election shall be subject to the approval of the Committee.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1 TERMINATION FOR REASONS OTHER THAN DISABILITY, RETIREMENT OR DEATH. If
Optionee's employment by the Company shall terminate for any reason other than
Disability or Retirement, or death, all Options which are unexercised on the
date of termination of employment shall expire and cease to be exercisable on
the earlier of (i) sixty days following the date of such termination of
employment, or (ii) the expiration of the Option Term. The Committee, in its
sole discretion, may notify Optionee prior to the date of expiration of such
Options that any or all of such Options shall remain exercisable for a
particular period of time following such date.
4.2 RETIREMENT. Upon Optionee's Retirement, all Options may be exercised at
any time and from time to time for a period ending on the earlier of (i) two
years following the date of Optionee's Retirement or (ii) the expiration of the
Option Term.
4.3 DEATH. Upon Optionee's death, Optionee's executors, administrators, or
any person or persons to whom Options have been transferred by will or by the
laws of descent and distribution, shall have the right at any time and from time
to time to exercise such Options for a period ending on the earlier of (i) two
years following the date of Optionee's death or (ii) the expiration of the
Option Term.
4.4 DISABILITY. Upon Optionee's Disability, all Options may be exercised at
any time and from time to time by Optionee or his guardian or legal
representative for a period ending on the earlier of (i) two years from the date
such Disability occurred, or (ii) the expiration of the Option Term.
ARTICLE 5
MISCELLANEOUS
5.1 CHANGE IN COMMON STOCK. In the event of any change in the outstanding
shares of the Common Stock of the Company by reason of any stock split, stock
dividend, recapitalization, reclassification, spin-off, merger, consolidation,
combination or exchange of shares or other similar corporate change, or in the
4
<PAGE>
event of any special distribution to stockholders (other than a normal cash
dividend), then the Committee shall make such adjustment or substitution in the
kind and number of shares and prices per share applicable to the Options as the
Committee determines to be equitable and appropriate.
5.2 NO RIGHTS AS STOCKHOLDER. Nothing contained in this Agreement or in the
Plan shall be deemed to confer upon Optionee any right to prevent or to approve
or vote upon any of the corporate actions described in this Article 6. The
existence of the Options shall not affect in any way the right or the power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. Optionee shall not be deemed for any purpose to
be a stockholder of the Company in respect of any shares as to which Options
shall not have been exercised as herein provided, and until such shares have
been issued to Optionee by the Company hereunder.
5.3 OPTIONEE. Whenever the word 'Optionee' is used in any provision of this
Agreement under circumstances where the provision should logically be construed
to apply to the executors, the administrators, or the person or persons to whom
options may be transferred by will or by the laws of descent and distribution,
the word 'Optionee' shall be deemed to include such person or persons.
5.4 NO TRANSFERABILITY. The Options are not transferable by Optionee
otherwise than by will or the laws of descent and distribution and are
exercisable during Optionee's lifetime only by him or his guardian or legal
representative. No assignment or transfer of the Options, or of the rights
represented thereby, whether voluntary or involuntary, by the operation of law
or otherwise (except by will or the laws of descent and distribution), shall
vest in the assignee or transferee any interest or right herein whatsoever, but
immediately upon any such assignment or transfer, the Options shall terminate
and become of no further effect.
5.5 NO RIGHT TO EMPLOYMENT. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in the employ of the Company or shall
affect the right of the Company to terminate the employment of Optionee with or
without cause.
5
<PAGE>
5.6 REGISTRATION OF SHARES UNDER PLAN. The Company shall register the
shares reserved for issuance under the Plan on a Form S-8 or any successor form
promulgated by the Securities and Exchange Commission and shall maintain the
effectiveness of such registration unless the Committee determines that
maintaining such effectiveness would be impracticable or materially adverse to
the interests of the Company.
5.7 NOTICES. Every notice or other communication relating to this Agreement
shall be in writing and shall be mailed to or delivered to the party for whom it
is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided; provided,
however, that unless and until some other address be so designated, all notices
or communications by Optionee to the Company shall be mailed or delivered to the
Company at its office at 83 Wooster Heights Road, Danbury, Connecticut 06813,
and all notices or communications by the Company to Optionee may be given to
Optionee personally or may be mailed to him.
5.8 ENTIRE AGREEMENT. This Agreement represents the entire agreement of the
parties with respect to the subject matter hereof. The Agreement may be amended
at any time by written agreement of the parties hereto.
5.9 GOVERNING LAW. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the State of
Delaware other than the conflict of laws provisions of such laws.
5.10 SEVERABILITY. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with the law continue in full force and effect. If any
provision of this Agreement shall be held invalid in part, such invalidity shall
in no way affect the rest of such provision not held so invalid, and the rest of
such provision, together with all other provisions of this Agreement, shall to
the full extent consistent with law continue in full force and effect.
5.11 EFFECT ON OTHER PLANS. Income realized by Optionee pursuant to this
Agreement shall not be included in Optionee's earnings for the purpose of any
benefit plan of the Company in which Optionee may be enrolled or for which
Optionee may become eligible unless otherwise specifically provided for in such
plan.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
<TABLE>
<S> <C>
OPTIONEE: FIRST BRANDS CORPORATION
...................................... By .............................
Secretary
</TABLE>
7
<PAGE>
EXHIBIT A
EXERCISE OF STOCK OPTION
FIRST BRANDS 1994 PERFORMANCE STOCK OPTION AND INCENTIVE PLAN
Pursuant to the provisions of the Stock Option Agreement entered into as of
August 9, 1994, between First Brands Corporation (the 'Company') and
, Optionee, I hereby exercise the nonqualified stock
option granted under the terms of this Agreement to the extent of
shares of the Common Stock of the Company (the 'Shares'). I deliver to
you herewith the following in payment for the Shares:
$ in cash
Stock certificates for shares of Common Stock of the Company
Cashless Exercise Program
<TABLE>
<S> <C>
Date: ................................. ..................................
Optionee
..................................
Address
..................................
Social Security Number
</TABLE>
<PAGE>
EXHIBIT B
FIRST BRANDS CORPORATION
CASHLESS EXERCISE OF STOCK OPTIONS
Participants in the First Brands Stock Option Programs who are actively
employed may sell option shares without tendering cash or existing shares in
advance for payment of the option price to the Company. In this process,
participants essentially assign the rights to sell their option shares to Lehman
Brothers who in return are required to pay the proceeds to First Brands. The
Company then uses our payroll system to withhold applicable federal, state and
local taxes, brokerage and transaction fees. The option price is deducted from
the proceeds and the optionee receives a check from the Cashier's Department.
To initiate a transaction under this procedure the optionee must execute
two forms (which are available from Lisa Hull, Shareholder Relations
Administrator, in Danbury, extension 2581) by 12:00 noon on the date the option
is to be exercised. Forms received after 12:00 noon will be processed in the
next day's trading. All option shares sold will be at the current market price
at the time of the sale. Proceeds will be paid to the optionee after the funds
have cleared the brokerage accounts and have been wired to the Company.
Brokerage fees charged by Lehman Brothers will be at their discounted rates.
If you have any questions about this procedure or would like to request
exercise forms, please call Lisa Hull in Danbury on extension 2581.
<PAGE>
EXHIBIT 4(g)
9/8/94
PERFORMANCE-BASED VESTING
INSIDER FORM
FIRST BRANDS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 9th day of August, 1994, by and between
FIRST BRANDS CORPORATION (the 'Company'), a Delaware corporation having its
headquarters in Danbury, Connecticut,
and
, an employee of the Company
('Optionee').
ARTICLE 1
RECITALS
1.1 Optionee is an employee of the Company, and the Company desires to
provide Optionee with an increased incentive to achieve long-range corporate
objectives and to participate in the long-term growth and financial success of
the Company.
1.2 In order to provide such an increased incentive to its employees, the
Company has adopted the First Brands Corporation 1994 Performance Stock Option
and Incentive Plan (the 'Plan').
1.3 The Company desires to grant to Optionee under the Plan stock options
that do not qualify as 'incentive stock options' within the meaning of Section
422 or any successor provision of the Internal Revenue Code of 1986, as amended
(the 'Code').
1.4 The terms of the Plan are incorporated by reference herein in their
entirety, and capitalized terms used in this Agreement, unless otherwise defined
herein, shall have the respective meanings given to such terms in the Plan.
ARTICLE 2
OPTION GRANT
2.1 Grant. The Company hereby grants to Optionee, subject to the provisions
of this Agreement, the right and option to
<PAGE>
purchase up to, but not exceeding in the aggregate, shares of the
Common Stock of the Company, par value $.01 per share (the 'Common Stock'), for
the period beginning on August 9, 1994 and ending on August 8, 2004 (the 'Option
Term'), at the option price of $32.750 per share.
2.2 Nonqualified Options. The options granted hereunder (the 'Options')
shall be Nonqualified Options and are not intended to qualify as 'incentive
stock options' within the meaning of Section 422 of the Code.
ARTICLE 3
EXERCISE AND WITHHOLDING
3.1 (a) Vesting. The Options shall become exercisable ('vest') upon the
earlier of (i) the last day of the first period of ten consecutive trading days
following the date hereof during which the Fair Market Value per share exceeds
$42.00 or (ii) August 8, 2003. There will not be any partial vesting of the
Options prior to the vesting date set forth above.
(b) Acceleration of Vesting. All Options shall become immediately
exercisable (i) upon the death, Disability or Retirement of Optionee, and (ii)
upon the occurrence of a Change of Control of the Company.
(c) Restriction on Vesting. Except in the case of the death or Disability
of Optionee, no part of the Options shall vest until at least six months have
elapsed after the date of this Agreement.
(d) Exercise. Once Options have vested, they may be exercised at any time
and from time to time during the Option Term (except as set forth in Article 4
hereof).
3.2 Method of Exercise. Options shall be exercised by Optionee by
delivering to the Company a Notice in the form set forth as Exhibit A hereto,
together with a check payable to the order of the Company and/or shares of
Common Stock, with a stock power executed in blank, equal in value to the option
price of the shares being purchased. Shares of Common Stock surrendered in
exercise of all of any portion of the Option shall be valued at their Fair
Market Value on the date of exercise. Active employees may also use the
'Cashless Exercise Program' which was announced to Optionees on June 11, 1991. A
copy is attached as Exhibit B to this Agreement.
3.3 Compliance with Securities Laws. Optionee shall deliver to the Company
at the time all or any portion of the Options is exercised any additional
evidence as the Company may
2
<PAGE>
deem necessary to establish that such exercise is in compliance with all
applicable securities laws.
3.4 (a) Tax Withholding. The Company shall notify Optionee of the amount of
withholding tax, if any, which must be paid under federal and, where applicable,
state and local law upon exercise of Options. The Company shall have the right
to require Optionee to pay such withholding taxes in either of the following two
ways:
(i) Cash. Such payment may be made in cash, through withholding from
Optionee's salary or otherwise, or
(ii) Common Stock. At the election of Optionee, subject to the
approval of the Compensation Committee of the Board of Directors of the
Company (the 'Committee'), such payment may be made, in whole or in part,
in shares of Common Stock.
(b) Payment in Shares of Common Stock. Payment of withholding taxes in
shares of Common Stock may be made in any of the following three ways, at the
election of Optionee, subject to the approval of the Committee, and compliance
with such limitations, conditions and restrictions as the Committee may impose,
or by a combination of any of such ways:
(i) Surrender of Options. Optionee may have shares withheld from
shares otherwise issuable to Optionee in connection with the exercise of
all or any portion of the Options;
(ii) Previously Acquired Shares. Optionee may deliver previously
acquired shares to the Company prior to transfer to Optionee of shares
issuable in connection with the exercise of all or any portion of the
Options; or
(iii) Tender Back of Shares. Optionee may tender back shares to the
Company from shares issued to Optionee in connection with the exercise of
all or any portion of the Options.
(c) Valuation. Shares so withheld, delivered or tendered back shall be
valued at their Fair Market Value on the date on which the amount of tax to be
withheld is determined (the 'Tax Date'). The tax withholding obligations that
may be paid by such withholding of shares otherwise issuable in connection with
the exercise of all or any portion of the Options or the delivery of shares held
less than six months may not exceed the minimum withholding requirements imposed
by law. The tax withholding obligations that may be paid by the delivery or
tender back of shares held by the Optionee for six months or longer may exceed
the Optionee's tax obligations associated with the transaction,
3
<PAGE>
including any related FICA obligations, determined based upon the Optionee's
maximum marginal tax rate. Solely for the purposes of this Section 3.4(c), the
six-month period with respect to any restricted stock granted under the Plan or
the Company's 1989 Long-Term Incentive Plan and used by Optionee to pay a tax
withholding obligation shall begin upon the lapse of the applicable
restrictions.
(d) Election. Optionee's election to have withheld shares of Common stock
that are otherwise issuable, or to deliver or tender back shares, shall be in
writing, shall be irrevocable and shall be delivered to the Company prior to the
Tax Date. Such election shall be subject to the approval of the Committee. If
Optionee is subject to the short-swing profit rules of Section 16(b) of the
Securities Exchange Act of 1934, as amended (the 'Exchange Act'), such election
(i) shall, unless otherwise approved by the Committee, be delivered to the
Company (x) at least six months prior to the Tax Date or (y) during a 'window'
period as described in Rule 16b-3(e)(3) under the Exchange Act, and (ii) shall
not be made within six months after the grant of the Options, except that this
limitation shall not apply in the event Optionee dies or becomes Disabled prior
to the expiration of such six-month period.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1 Termination for Reasons Other than Disability, Retirement or Death. If
Optionee's employment by the Company shall terminate for any reason other than
Disability or Retirement, or death, all Options which are unexercised on the
date of termination of employment shall expire and cease to be exercisable on
the earlier of (i) sixty days following the date of such termination of
employment, or (ii) the expiration of the Option Term. The Committee, in its
sole discretion, may notify Optionee prior to the date of expiration of such
Options that any or all of such Options shall remain exercisable for a
particular period of time following such date.
4.2 Retirement. Upon Optionee's Retirement, all Options may be exercised at
any time and from time to time for a period ending on the earlier of (i) two
years following the date of Optionee's Retirement or (ii) the expiration of the
Option Term.
4.3 Death. Upon Optionee's death, Optionee's executors, administrators, or
any person or persons to whom Options have been transferred by will or by the
laws of descent and distribution, shall have the right at any time and from time
to time to exercise such Options for a period ending on the earlier
4
<PAGE>
of (i) two years following the date of Optionee's death or (ii) the expiration
of the Option Term.
4.4 Disability. Upon Optionee's Disability, all Options may be exercised at
any time and from time to time by Optionee or his guardian or legal
representative for a period ending on the earlier of (i) two years from the date
such Disability occurred, or (ii) the expiration of the Option Term.
ARTICLE 5
LIMITED STOCK APPRECIATION RIGHTS
5.1 Grant. The Company hereby grants to Optionee, in tandem with the
options granted under Article 2 hereof, limited stock appreciation rights
('LSARs') with respect to that number of shares of the Common Stock as to which
options are granted under Article 2 hereof.
5.2 Exercise. Upon the occurrence of a Change of Control of the Company (as
hereinafter defined), all LSARs granted more than six months prior to such
Change of Control shall immediately and without any action or discretion on the
part of Optionee, be exercised. Upon the exercise of an LSAR, the option to
which such LSAR relates shall terminate and shall no longer be exercisable.
5.3 Payment. The exercise of an LSAR shall entitle Optionee to receive from
the Company an amount equal to the excess of the Fair Market Value (as defined
in the Plan) on the date of such exercise of a share of the Common Stock of the
Company and the option price of the option to which such LSAR relates. Such
amount shall be paid by the Company to Optionee in cash on or promptly following
the date of exercise of the LSAR.
5.4 Change of Control. For the purposes hereof, 'Change of Control' shall
mean (i) a merger of the Company into or with another entity, other than a
merger in which the former stockholders of the Company own immediately following
the transaction more than 50% of the total combined voting rights of all classes
of stock of the surviving entity having voting rights or convertible into stock
having voting rights; (ii) the sale or other disposition of all or substantially
all of the assets of the Company; (iii) the sale or other disposition (except by
means of a registered public offering of the Common Stock of the Company on a
form other than Form S-4 or any successor form) of an amount of stock comprising
more than 50% of the total combined voting rights of all classes of stock having
voting rights or convertible into stock having voting rights; (iv) the
liquidation or dissolution of the Company; or (v) a change in the composition of
the Board of Directors of the Company such that at any time
5
<PAGE>
a majority of the Board of Directors have been members of the Board of Directors
for less than twenty-four months, and the appointment or election of such new
members of the Board of Directors was not endorsed by at least three-fourths of
the directors who were members of the Board of Directors at the beginning of
such twenty-four month period.
ARTICLE 6
MISCELLANEOUS
6.1 Change in Common Stock. In the event of any change in the outstanding
shares of the Common Stock of the Company by reason of any stock split, stock
dividend, recapitalization, reclassification, spin-off, merger, consolidation,
combination or exchange of shares or other similar corporate change, or in the
event of any special distribution to stockholders (other than a normal cash
dividend), then the Committee shall make such adjustment or substitution in the
kind and number of shares and prices per share applicable to the Options as the
Committee determines to be equitable and appropriate.
6.2 No Rights as Stockholder. Nothing contained in this Agreement or in the
Plan shall be deemed to confer upon Optionee any right to prevent or to approve
or vote upon any of the corporate actions described in this Article 6. The
existence of the Options shall not affect in any way the right or the power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. Optionee shall not be deemed for any purpose to
be a stockholder of the Company in respect of any shares as to which Options
shall not have been exercised as herein provided, and until such shares have
been issued to Optionee by the Company hereunder.
6.3 Optionee. Whenever the word 'Optionee' is used in any provision of this
Agreement under circumstances where the provision should logically be construed
to apply to the executors, the administrators, or the person or persons to whom
options may be transferred by will or by the laws of descent and distribution,
the word 'Optionee' shall be deemed to include such person or persons.
6
<PAGE>
6.4 No Transferability. The Options are not transferable by Optionee
otherwise than by will or the laws of descent and distribution and are
exercisable during Optionee's lifetime only by him or his guardian or legal
representative. No assignment or transfer of the Options, or of the rights
represented thereby, whether voluntary or involuntary, by the operation of law
or otherwise (except by will or the laws of descent and distribution), shall
vest in the assignee or transferee any interest or right herein whatsoever, but
immediately upon any such assignment or transfer, the Options shall terminate
and become of no further effect.
6.5 No Right to Employment. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in the employ of the Company or shall
affect the right of the Company to terminate the employment of Optionee with or
without cause.
6.6 Registration of Shares Under Plan. The Company shall register the
shares reserved for issuance under the Plan on a Form S-8 or any successor form
promulgated by the Securities and Exchange Commission and shall maintain the
effectiveness of such registration unless the Committee determines that
maintaining such effectiveness would be impracticable or materially adverse to
the interests of the Company.
6.7 Notices. Every notice or other communication relating to this Agreement
shall be in writing and shall be mailed to or delivered to the party for whom it
is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided; provided,
however, that unless and until some other address be so designated, all notices
or communications by Optionee to the Company shall be mailed or delivered to the
Company at its office at 83 Wooster Heights Road, Danbury, Connecticut 06813,
and all notices or communications by the Company to Optionee may be given to
Optionee personally or may be mailed to him.
6.8 Entire Agreement. This Agreement represents the entire agreement of the
parties with respect to the subject matter hereof. The Agreement may be amended
at any time by written agreement of the parties hereto.
6.9 Governing Law. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the State of
Delaware other than the conflict of laws provisions of such laws.
6.10 Severability. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with the law continue in full force and effect. If any
provision
7
<PAGE>
of this Agreement shall be held invalid in part, such invalidity shall in no way
affect the rest of such provision not held so invalid, and the rest of such
provision, together with all other provisions of this Agreement, shall to the
full extent consistent with law continue in full force and effect.
6.11 Effect on Other Plans. Income realized by Optionee pursuant to this
Agreement shall not be included in Optionee's earnings for the purpose of any
benefit plan of the Company in which Optionee may be enrolled or for which
Optionee may become eligible unless otherwise specifically provided for in such
plan.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
<TABLE>
<S> <C>
OPTIONEE: FIRST BRANDS CORPORATION
...................................... By ..............................
Secretary
</TABLE>
8
<PAGE>
EXHIBIT A
EXERCISE OF STOCK OPTION FIRST BRANDS 1994 PERFORMANCE STOCK OPTION AND
INCENTIVE PLAN
Pursuant to the provisions of the Stock Option Agreement entered into as of
August 9, 1994, between First Brands Corporation (the 'Company') and ,
Optionee, I hereby exercise the nonqualified stock option granted under the
terms of this Agreement to the extent of shares of the Common
Stock of the Company (the 'Shares'). I deliver to you herewith the following in
payment for the Shares:
$ in cash
Stock certificates for shares of Common Stock of the Company
Cashless Exercise Program
<TABLE>
<S> <C>
Date: ................................. .................................
Optionee
.................................
Address
.................................
Social Security Number
</TABLE>
<PAGE>
EXHIBIT B
FIRST BRANDS CORPORATION
CASHLESS EXERCISE OF STOCK OPTIONS
Participants in the First Brands Stock Option Programs who are actively
employed may sell option shares without tendering cash or existing shares in
advance for payment of the option price to the Company. In this process,
participants essentially assign the rights to sell their option shares to Lehman
Brothers who in return are required to pay the proceeds to First Brands. The
Company then uses our payroll system to withhold applicable federal, state and
local taxes, brokerage and transaction fees. The option price is deducted from
the proceeds and the optionee receives a check from the Cashier's Department.
To initiate a transaction under this procedure the optionee must execute
two forms (which are available from Lisa Hull, Shareholder Relations
Administrator, in Danbury, extension 2581) by 12:00 noon on the date the option
is to be exercised. Forms received after 12:00 noon will be processed in the
next day's trading. All option shares sold will be at the current market price
at the time of the sale. Proceeds will be paid to the optionee after the funds
have cleared the brokerage accounts and have been wired to the Company.
Brokerage fees charged by Lehman Brothers will be at their discounted rates.
If you have any questions about this procedure or would like to request
exercise forms, please call Lisa Hull in Danbury on extension 2581.
<PAGE>
EXHIBIT 4(h)
9/8/94
PERFORMANCE-BASED VESTING
NON-INSIDER FORM
FIRST BRANDS CORPORATION
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 9th day of August, 1994, by and between
FIRST BRANDS CORPORATION (the 'Company'), a Delaware corporation having its
headquarters in Danbury, Connecticut,
and
, an employee of the Company
('Optionee').
ARTICLE 1
RECITALS
1.1 Optionee is an employee of the Company, and the Company desires to
provide Optionee with an increased incentive to achieve long-range corporate
objectives and to participate in the long-term growth and financial success of
the Company.
1.2 In order to provide such an increased incentive to its employees, the
Company has adopted the First Brands Corporation 1994 Performance Stock Option
and Incentive Plan (the 'Plan').
1.3 The Company desires to grant to Optionee under the Plan stock options
that do not qualify as 'incentive stock options' within the meaning of Section
422 or any successor provision of the Internal Revenue Code of 1986, as amended
(the 'Code').
1.4 The terms of the Plan are incorporated by reference herein in their
entirety, and capitalized terms used in this Agreement, unless otherwise defined
herein, shall have the respective meanings given to such terms in the Plan.
ARTICLE 2
OPTION GRANT
2.1 Grant. The Company hereby grants to Optionee, subject to the provisions
of this Agreement, the right and option to purchase up to, but not exceeding in
the aggregate,
<PAGE>
shares of the Common Stock of the Company, par value $.01 per share (the 'Common
Stock'), for the period beginning on August 9, 1994 and ending on August 8, 2004
(the 'Option Term'), at the option price of $32.750 per share.
2.2 Nonqualified Options. The options granted hereunder (the 'Options')
shall be Nonqualified Options and are not intended to qualify as 'incentive
stock options' within the meaning of Section 422 of the Code.
ARTICLE 3
EXERCISE AND WITHHOLDING
3.1 (a) Vesting. The Options shall become exercisable ('vest') upon the
earlier of (i) the last day of the first period of ten consecutive trading days
following the date hereof during which the Fair Market Value per share exceeds
$42.00 or (ii) August 8, 2003. There will not be any partial vesting of the
Options prior to the respective vesting date set forth above.
(b) Acceleration of Vesting. All Options shall become immediately
exercisable (i) upon the death, Disability or Retirement of Optionee, and (ii)
upon the occurrence of a Change of Control of the Company.
(c) Exercise. Once Options have vested, they may be exercised at any time
and from time to time during the Option Term (except as set forth in Article 4
hereof).
3.2 Method of Exercise. Options shall be exercised by Optionee by
delivering to the Company a Notice in the form set forth as Exhibit A hereto,
together with a check payable to the order of the Company and/or shares of
Common Stock, with a stock power executed in blank, equal in value to the option
price of the shares being purchased. Shares of Common Stock surrendered in
exercise of all of any portion of the Option shall be valued at their Fair
Market Value on the date of exercise. Active employees may also use the
'Cashless Exercise Program' which was announced to Optionees on June 11, 1991. A
copy is attached as Exhibit B to this Agreement.
3.3 Compliance with Securities Laws. Optionee shall deliver to the Company
at the time all or any portion of the Options is exercised any additional
evidence as the Company may deem necessary to establish that such exercise is in
compliance with all applicable securities laws.
3.4 (a) Tax Withholding. The Company shall notify Optionee of the amount of
withholding tax, if any, which must be paid under federal and, where applicable,
state and local law
2
<PAGE>
upon exercise of Options. The Company shall have the right to require Optionee
to pay such withholding taxes in either of the following two ways:
(i) Cash. Such payment may be made in cash, through withholding from
Optionee's salary or otherwise, or
(ii) Common Stock. At the election of Optionee, subject to the
approval of the Compensation Committee of the Board of Directors of the
Company (the 'Committee'), such payment may be made, in whole or in part,
in shares of Common Stock.
(b) Payment in Shares of Common Stock. Payment of withholding taxes in
shares of Common Stock may be made in any of the following three ways, at the
election of Optionee, subject to the approval of the Committee, and compliance
with such limitations, conditions and restrictions as the Committee may impose,
or by a combination of any of such ways:
(i) Surrender of Options. Optionee may have shares withheld from
shares otherwise issuable to Optionee in connection with the exercise of
all or any portion of the Options;
(ii) Previously Acquired Shares. Optionee may deliver previously
acquired shares to the Company prior to transfer to Optionee of shares
issuable in connection with the exercise of all or any portion of the
Options; or
(iii) Tender Back of Shares. Optionee may tender back shares to the
Company from shares issued to Optionee in connection with the exercise of
all or any portion of the Options.
(c) Valuation. Shares so withheld, delivered or tendered back shall be
valued at their Fair Market Value on the date on which the amount of tax to be
withheld is determined (the 'Tax Date'). The tax withholding obligations that
may be paid by such withholding of shares otherwise issuable in connection with
the exercise of all or any portion of the Options or the delivery of shares held
less than six months may not exceed the minimum withholding requirements imposed
by law. The tax withholding obligations that may be paid by the delivery or
tender back of shares held by the Optionee for six months or longer may exceed
the Optionee's tax obligations associated with the transaction, including any
related FICA obligations, determined based upon the Optionee's maximum marginal
tax rate. Solely for the purposes of this Section 3.4(c), the six-month period
with respect to any restricted stock granted under the Plan or the Company's
1989 Long-Term Incentive Plan and used by Optionee to pay a tax
3
<PAGE>
withholding obligation shall begin upon the lapse of the applicable
restrictions.
(d) Election. Optionee's election to have withheld shares of Common stock
that are otherwise issuable, or to deliver or tender back shares, shall be in
writing, shall be irrevocable and shall be delivered to the Company prior to the
Tax Date. Such election shall be subject to the approval of the Committee.
ARTICLE 4
TERMINATION OF EMPLOYMENT
4.1 Termination for Reasons Other than Disability, Retirement or Death. If
Optionee's employment by the Company shall terminate for any reason other than
Disability or Retirement, or death, all Options which are unexercised on the
date of termination of employment shall expire and cease to be exercisable on
the earlier of (i) sixty days following the date of such termination of
employment, or (ii) the expiration of the Option Term. The Committee, in its
sole discretion, may notify Optionee prior to the date of expiration of such
Options that any or all of such Options shall remain exercisable for a
particular period of time following such date.
4.2 Retirement. Upon Optionee's Retirement, all Options may be exercised at
any time and from time to time for a period ending on the earlier of (i) two
years following the date of Optionee's Retirement or (ii) the expiration of the
Option Term.
4.3 Death. Upon Optionee's death, Optionee's executors, administrators, or
any person or persons to whom Options have been transferred by will or by the
laws of descent and distribution, shall have the right at any time and from time
to time to exercise such Options for a period ending on the earlier of (i) two
years following the date of Optionee's death or (ii) the expiration of the
Option Term.
4.4 Disability. Upon Optionee's Disability, all Options may be exercised at
any time and from time to time by Optionee or his guardian or legal
representative for a period ending on the earlier of (i) two years from the date
such Disability occurred, or (ii) the expiration of the Option Term.
ARTICLE 5
MISCELLANEOUS
5.1 Change in Common Stock. In the event of any change in the outstanding
shares of the Common Stock of the Company by
4
<PAGE>
reason of any stock split, stock dividend, recapitalization, reclassification,
spin-off, merger, consolidation, combination or exchange of shares or other
similar corporate change, or in the event of any special distribution to
stockholders (other than a normal cash dividend), then the Committee shall make
such adjustment or substitution in the kind and number of shares and prices per
share applicable to the Options as the Committee determines to be equitable and
appropriate.
5.2 No Rights as Stockholder. Nothing contained in this Agreement or in the
Plan shall be deemed to confer upon Optionee any right to prevent or to approve
or vote upon any of the corporate actions described in this Article 6. The
existence of the Options shall not affect in any way the right or the power of
the Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stocks ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. Optionee shall not be deemed for any purpose to
be a stockholder of the Company in respect of any shares as to which Options
shall not have been exercised as herein provided, and until such shares have
been issued to Optionee by the Company hereunder.
5.3 Optionee. Whenever the word 'Optionee' is used in any provision of this
Agreement under circumstances where the provision should logically be construed
to apply to the executors, the administrators, or the person or persons to whom
options may be transferred by will or by the laws of descent and distribution,
the word 'Optionee' shall be deemed to include such person or persons.
5.4 No Transferability. The Options are not transferable by Optionee
otherwise than by will or the laws of descent and distribution and are
exercisable during Optionee's lifetime only by him or his guardian or legal
representative. No assignment or transfer of the Options, or of the rights
represented thereby, whether voluntary or involuntary, by the operation of law
or otherwise (except by will or the laws of descent and distribution), shall
vest in the assignee or transferee any interest or right herein whatsoever, but
immediately upon any such assignment or transfer, the Options shall terminate
and become of no further effect.
5.5 No Right to Employment. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in the
5
<PAGE>
employ of the Company or shall affect the right of the Company to terminate the
employment of Optionee with or without cause.
5.6 Registration of Shares Under Plan. The Company shall register the
shares reserved for issuance under the Plan on a Form S-8 or any successor form
promulgated by the Securities and Exchange Commission and shall maintain the
effectiveness of such registration unless the Committee determines that
maintaining such effectiveness would be impracticable or materially adverse to
the interests of the Company.
5.7 Notices. Every notice or other communication relating to this Agreement
shall be in writing and shall be mailed to or delivered to the party for whom it
is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided; provided,
however, that unless and until some other address be so designated, all notices
or communications by Optionee to the Company shall be mailed or delivered to the
Company at its office at 83 Wooster Heights Road, Danbury, Connecticut 06813,
and all notices or communications by the Company to Optionee may be given to
Optionee personally or may be mailed to him.
5.8 Entire Agreement. This Agreement represents the entire agreement of the
parties with respect to the subject matter hereof. The Agreement may be amended
at any time by written agreement of the parties hereto.
5.9 Governing Law. This Agreement and its validity, interpretation,
performance and enforcement shall be governed by the laws of the State of
Delaware other than the conflict of laws provisions of such laws.
5.10 Severability. If, for any reason, any provision of this Agreement is
held invalid, such invalidity shall not affect any other provision of this
Agreement not held so invalid, and each such other provision shall to the full
extent consistent with the law continue in full force and effect. If any
provision of this Agreement shall be held invalid in part, such invalidity shall
in no way affect the rest of such provision not held so invalid, and the rest of
such provision, together with all other provisions of this Agreement, shall to
the full extent consistent with law continue in full force and effect.
5.11 Effect on Other Plans. Income realized by Optionee pursuant to this
Agreement shall not be included in Optionee's earnings for the purpose of any
benefit plan of the Company in which Optionee may be enrolled or for which
Optionee may become eligible unless otherwise specifically provided for in such
plan.
6
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first above written.
<TABLE>
<S> <C>
OPTIONEE: FIRST BRANDS CORPORATION
...................................... By ..............................
Secretary
</TABLE>
7
<PAGE>
EXHIBIT A
EXERCISE OF STOCK OPTION
FIRST BRANDS 1994 PERFORMANCE STOCK OPTION AND INCENTIVE PLAN
Pursuant to the provisions of the Stock Option Agreement entered into as of
August 9, 1994, between First Brands Corporation (the 'Company') and , Optionee,
I hereby exercise the nonqualified stock option granted under the terms of this
Agreement to the extent of shares of the Common Stock of the Company (the
'Shares'). I deliver to you herewith the following in payment for the Shares:
$ in cash
Stock certificates for shares of Common Stock of the Company
Cash Exercise Program
<TABLE>
<S> <C>
Date: ................................. ..................................
Optionee
..................................
Address
..................................
Social Security Number
</TABLE>
<PAGE>
EXHIBIT B
FIRST BRANDS CORPORATION
CASHLESS EXERCISE OF STOCK OPTIONS
Participants in the First Brands Stock Option Programs who are actively
employed may sell option shares without tendering cash or existing shares in
advance for payment of the option price to the Company. In this process,
participants essentially assign the rights to sell their option shares to Lehman
Brothers who in return are required to pay the proceeds to First Brands. The
Company then uses our payroll system to withhold applicable federal, state and
local taxes, brokerage and transaction fees. The option price is deducted from
the proceeds and the optionee receives a check from the Cashier's Department.
To initiate a transaction under this procedure the optionee must execute
two forms (which are available from Lisa Hull, Shareholder Relations
Administrator, in Danbury, extension 2581) by 12:00 noon on the date the option
is to be exercised. Forms received after 12:00 noon will be processed in the
next day's trading. All option shares sold will be at the current market price
at the time of the sale. Proceeds will be paid to the optionee after the funds
have cleared the brokerage accounts and have been wired to the Company.
Brokerage fees charged by Lehman Brothers will be at their discounted rates.
If you have any questions about this procedure or would like to request
exercise forms, please call Lisa Hull in Danbury on extension 2581.
<PAGE>
EXHIBIT 5
November 14, 1994
The Board of Directors
First Brands Corporation
83 Wooster Heights Road
Danbury, Connecticut 06813-1911
Re: First Brands Corporation
Registration Statement on
Form S-8 (No. 33- )
Dear Sirs:
I am the General Counsel to First Brands Corporation, a Delaware
corporation (the 'Company'), and have acted as its counsel in connection with
its Registration Statement on Form S-8 (the 'Registration Statement') being
filed on the date hereof and relating to 1,090,000 shares (the 'Shares') of
Common Stock, $0.01 par value per share (the 'Common Stock'), of the Company
which may be offered and sold pursuant to the First Brands Corporation 1994
Performance Stock Option and Incentive Plan (the 'Plan') of the Company.
In that connection, I have examined originals, or copies certified or
otherwise identified to my satisfaction, of such documents, corporate records
and other instruments as I have deemed necessary or appropriate for the purpose
of rendering this opinion, including: (a) the Restated Certificate of
Incorporation of the Company; (b) the By-laws of the Company; (c) the
Registration Statement; (d) resolutions adopted by the Board of Directors of the
Company in respect of the Plan; and (e) the Plan.
Based upon the foregoing, and assuming that the exercise price of any
option granted under the Plan shall not be less than the par value of the Common
Stock, I am of the opinion that the Shares have been duly authorized and will,
when issued upon the exercise of options in accordance with provisions of the
Plan, be validly issued, fully paid and nonassesable.
I hereby consent to the reference to me under the caption 'Interest of
Names Experts and Counsel' in the Registration
<PAGE>
Statement and to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
/s/ J. BRUCE IPE
General Counsel
JBI/sc
<PAGE>
EXHIBIT 23(a)
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
First Brands Corporation
We consent to the use of our audit report dated August 9, 1994 (except as
to Note 19, which is as of August 26, 1994) on the consolidated financial
statements and schedules of First Brands Corporation and subsidiaries as of June
30, 1994 and June 30, 1993 and for each of the years in the three year period
ended June 30, 1994 incorporated herein by reference in the Registration
Statement on Form S-8 of First Brands Corporation pertaining to the First Brands
Corporation 1994 Performance Stock Option and Incentive Plan and to the
reference to our firm under the heading 'Experts' in the prospectus.
Our audit report refers to First Brands Corporation's change in method of
accounting for postretirement benefits other than pensions by adopting Statement
of Financial Accounting Standards No. 106, 'Employer's Accounting for
Postretirement Benefits Other than Pensions'. Further, we acknowledge our
awareness of the use therein of our review report dated November 1, 1994 related
to our review of interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such review
report is not considered a part of a registration statement prepared or
certified by an accountant or a report prepared or certified by an accountant
within the meaning of sections 7 and 11 of the Act.
/s/ KPMG PEAT MARWICK LLP
New York, New York
November 11, 1994
