Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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Premark International, Inc.
(Exact name of Issuer as specified in its charter)
Delaware 36-3461320
(State or other jurisdiction of (I.R.S.
incorporation or organization) Employer Iden-
tification No.)
1717 Deerfield Road, Deerfield, Illinois 60015
(Address of principal executive offices) (Zip code)
PREMARK INTERNATIONAL, INC. 1994 INCENTIVE PLAN
(Full title of the plan)
JOHN M. COSTIGAN, Esq.
Senior Vice President, General Counsel
and Secretary
Premark International, Inc.
1717 Deerfield Road
Deerfield, Illinois 60015
(Name and address of agent for service)
(708) 405-6000
(Telephone number, including area code, of agent for
service)
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Approximate date of commencement of proposed sale to the
public: As soon as practicable after the Registration Statement
becomes effective.
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CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of maximum maximum Amount
securities Amount offering aggregate of re-
to be to be price per offering gistra-
registered registered share price tion fee
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Common Stock,
par value $1.00
per share...... 2,500,000(1) $75.875 (2) $189,687,500 $65,410.00
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(1) Shares available for future options or stock appreciation
rights, plus such additional number of shares as may be
issuable by reason of the anti-dilution provisions of the
Plan.
(2) Estimated solely for purposes of calculating the
Registration Fee and computed pursuant to Rule 457(h) under
the Securities Act of 1933, based on the average of the high
and low prices of the Registrant's Common Stock on the New
York Stock Exchange on May 5, 1994.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents are hereby incorporated by reference in
this Registration Statement:
(a) The Registrant's Annual Report on Form 10-K for the
fiscal year ended December 25, 1993, which contains audited
financial statements for the most recent year for which such
statements have been filed;
(b) All other reports filed by the Registrant pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") since December 25, 1993; and
(c) The description of the Registrant's Common Stock
contained in the Registrant's Registration Statement on Form
10 dated September 8, 1986, as amended, and the description
of rights attaching to such Common Stock contained in the
Registrant's current report on Form 8-K dated March 20, 1989.
All documents subsequently filed by the Registrant pursuant
to Sections 13, 14 and 15(d) of the Exchange Act, prior to the
filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be
incorporated by reference in this Registration Statement and to
be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
Described in Item 3(c) above.
Item 5. Interests of Named Experts and Counsel
The validity of the Common Stock which may be issued
pursuant to the Plan has been passed upon by John M. Costigan,
Senior Vice President, General Counsel and Secretary of
Registrant. Mr. Costigan has been granted options to acquire
120,350 shares of Common Stock of the Registrant.
Item 6. Indemnification of Directors and Officers.
Article Tenth of the Company's Restated Certificate of
Incorporation provides that each person who was or is made a
party to any action, suit or proceeding by reason of the fact
that he or she is or was a director, officer or employee of the
Company (or was serving at the request of the Company as a
director, officer, employee or agent for another entity) will be
indemnified and held harmless by the Company, to the full extent
authorized by the General Corporation Law of the State of
Delaware (the 'Delaware Law'), as currently in effect (or, to the
extent indemnification is broadened, as it may be amended),
against all expense, liability or loss (including attorneys'
fees, judgments, fines, ERISA excise taxes or penalties and
amounts to be paid in settlement) reasonably incurred by such
person in connection therewith. Such Article also provides that
rights conferred thereby are contract rights and will include the
right to be paid by the Company for the expenses incurred in
defending the proceedings specified above, in advance of their
final disposition, except that, if the Delaware Law so requires,
such payment will only be made upon delivery to the Company by
the indemnified party of an undertaking to repay all amounts so
advanced if it is ultimately determined that the person receiving
such payments is not entitled to be indemnified under such
provision or otherwise. Article Tenth provides that the Company
may, by action of its Board, provide indemnification to its
agents with the same scope and effect as the foregoing
indemnification of directors, officers and employees.
Such Article also provides that persons indemnified
thereunder may bring suit against the Company to recover unpaid
amounts claimed thereunder, and that if such suit is successful,
the expense of bringing such a suit will be reimbursed by the
Company. It further provides that while it is a defense to such a
suit that the person claiming indemnification has not met the
applicable standards of conduct making indemnification
permissible under the Delaware Law, the burden of proving the
defense will be on the Company and neither the failure of the
Company's Board to have made a determination that indemnification
is proper, nor an actual determination by such Board that the
claimant has not met the applicable standard of conduct, will be
a defense to the action or create a presumption that the claimant
has not met the applicable standard of conduct.
Such Article also provides that the rights to indemnification
and the payment of expenses incurred in defending a proceeding in
advance of its final disposition conferred therein will not be
exclusive of any other right which any person may have or acquire
under any statute, provision of the Company's Restated
Certificate of Incorporation or By-Laws, or otherwise. Finally,
it provides that the Company may maintain insurance, at its
expense, to protect itself and any of its directors, officers,
employees or agents against any expense, liability or loss,
whether or not the Company would have the power to indemnify such
person against such expense, liability or loss under the Delaware
Law.
Section 145 of the Delaware Law provides that corporations
organized thereunder have the power to indemnify directors,
officers, employees and agents against liability under certain
circumstances.
The Registrant also maintains a standard policy of officers'
and directors' liability insurance.
Item 8. Exhibits.
Exhibit
No. Description
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4.1 Premark International, Inc. 1994 Incentive Plan
4.2 Form of Stock Option Agreement
5 Opinion and Consent of John M. Costigan, Esq.
23 Consent of Independent Accountants
24 Powers of Attorney
Item 9. Undertakings.
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, as amended (the
"Securities Act");
(ii) To reflect in the prospectus any facts or
events arising after the effective date of this
Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in this Registration Statement; and
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in this Registration Statement or any material
change to such information in this Registration
Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above 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 15(d)
of the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
B. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the Registrant's annual report pursuant to Section
13(a) or 15(d) of the Exchange Act (and, where applicable, each
filing of an employee benefits plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by
reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid
by a director, officer or controlling person of the Registrant in
the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-8 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Deerfield, State of Illinois, on May 4, 1994.
PREMARK INTERNATIONAL, INC.
By: WARREN L. BATTS
Chairman of the
Board of Directors and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following
persons in the capacities and on the date indicated.
Signature Position
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WARREN L. BATTS Chairman of the Board
of Directors,
Chief Executive Officer and
Director
(Principal Executive Officer)
JAMES M. RINGLER President, Chief Operating
Officer and Director
* Director
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William O. Bourke
* Director
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Dr. Ruth M. Davis
* Director
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Dr. Lloyd C. Elam
* Director
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Clifford J. Grum
* Director
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Joseph E. Luecke
* Director
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Bob Marbut
* Director
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John B. McKinnon
* Director
________________________________
David R. Parker
* Director
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Robert M. Price
* Director
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Janice D. Stoney
ROBERT W. HOAGLUND Vice President, Control
and Information Systems
(Principal Accounting
Officer)
LAWRENCE B. SKATOFF Senior Vice President and
Chief Financial Officer
(Principal Financial
Officer)
*By: JOHN M. COSTIGAN
Attorney-in-fact
May 4, 1994
Exhibit No. Description Page
4.1 Premark International, Inc. 10-30
1994 Incentive Plan
4.2 Form of Stock Option 31-34
Agreement
5 Opinion and Consent of 35
John M. Costigan, Esq.
23 Consent of Independent 36
Accountants
24 Powers of Attorney 37
EXHIBIT 4.1
Annex I
Premark International, Inc. 1994 Incentive Plan
Article 1. Establishment, Purpose, and Duration
1.1 Establishment of the Plan. Premark International, Inc.,
a Delaware corporation (hereinafter referred to as the
"Company"), hereby establishes an incentive compensation plan to
be known as the "Premark International, Inc. 1994 Incentive Plan"
(hereinafter referred to as the "Plan"), as set forth in this
document. The Plan permits the grant of Nonqualified Stock
Options, Incentive Stock Options, SARs, Restricted Stock, and
Performance Awards. Subject to ratification by the Company's
shareholders, the Plan shall become effective as of May 4, 1994
(the "Effective Date"), and shall remain in effect as provided in
Section 1.3 herein.
1.2 Purpose of the Plan. The purpose of the Plan is to
promote the success and enhance the value of the Company by
linking the personal interests of Participants to those of the
Company's shareholders, and by providing Participants with an
incentive for outstanding performance. The Plan is further
intended to provide flexibility to the Company in its ability to
motivate, attract, and retain the services of Participants upon
whose judgment, interest, and special efforts the successful
conduct of its operations largely is dependent.
1.3 Duration of the Plan. The Plan shall commence on the
Effective Date, as described in Section 1.1 herein, and shall
remain in effect, subject to the right of the Board of Directors
to terminate, amend or modify the Plan at any time pursuant to
Article 15 herein, until all Shares subject to it shall have been
purchased or acquired according to the Plan's provisions.
However, in no event may an Award be granted under the Plan on or
after May 4, 2004.
Article 2. Definitions
Whenever used in the Plan, the following terms shall have
the meanings set forth below and, when the meaning is intended,
the initial letter of the word is capitalized:
(a) "Award" means, individually or collectively, a grant
under this Plan of Nonqualified Stock Options,
Incentive Stock Options, SARs, Restricted Stock, or
Performance Awards.
(b) "Award Agreement" means an agreement entered into by
each Participant and the Company, setting forth the
terms and provisions applicable to Awards granted to
Participants under this Plan.
(c) "Beneficial Owner" shall have the meaning ascribed to
such term in Rule 13d-3 of the General Rules and
Regulations under the Exchange Act.
(d) "Beneficiary" means a person who may be designated by a
Participant pursuant to Article 10 and to whom any
benefit under the Plan is to be paid in case of the
Participant's death or physical or mental incapacity,
as determined by the Committee, before he or she
receives any or all of such benefit.
(e) "Board" or "Board of Directors" means the Board of
Directors of the Company.
(f) "Change in Control" of the Company means:
(i) An acquisition by any Person of beneficial
ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 20% or more of either (1)
the then outstanding Shares (the "Outstanding Company
Common Stock") or (2) the combined voting power of the
then outstanding Shares entitled to vote generally in
the election of directors (the "Outstanding Company
Voting Securities"); excluding, however, the following:
(1) any acquisition directly from the Company, other
than an acquisition by virtue of the exercise of a
conversion privilege unless the security being so
converted was itself acquired from the Company, (2) any
acquisition by the Company, (3) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled
by the Company or (4) any acquisition by any Person
pursuant to a transaction which complies with clauses
(1), (2) and (3) of subsection (iii) of this
definition; or
(ii) A change in the composition of the Board such that
the individuals who, as of the effective date of the
Plan, constitute the Board (such Board shall be
hereinafter referred to as the "Incumbent Board") cease
for any reason to constitute at least a majority of the
Board; provided, however, for purposes of this
definition, that any individual who becomes a member of
the Board subsequent to such effective date, whose
election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a
majority of those individuals who are members of the
Board and who were also members of the Incumbent Board
(or deemed to be such pursuant to this proviso) shall
be considered as though such individual were a member
of the Incumbent Board; but, provided further, that any
such individual whose initial assumption of office
occurs as a result of either an actual or threatened
election contest (as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act)
or other actual or threatened solicitation of proxies
or consents by or on behalf of a person or legal entity
other than the Board shall not be so considered as a
member of the Incumbent Board; or
(iii) The approval by the stockholders of the
Company of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all
of the assets of the Company ("Corporate Transaction");
excluding, however, such a Corporate Transaction
pursuant to which (1) all or substantially all of the
individuals and entities who are the Beneficial Owners,
respectively, of the Outstanding Company Common Stock
and Outstanding Company Voting Securities immediately
prior to such Corporate Transaction will beneficially
own, directly or indirectly, more than 60% of,
respectively, the outstanding Shares, and the combined
voting power of the then outstanding Shares entitled to
vote generally in the election of directors, as the
case may be, of the company resulting from such
Corporate Transaction (including, without limitation, a
corporation which as a result of such transaction owns
the Company or all or substantially all of the
Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as
their ownership, immediately prior to such Corporate
Transaction, of the Outstanding Company Common Stock
and Outstanding Company Voting Securities, as the case
may be, (2) no Person (other than the Company, any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled
by the Company or such corporation resulting from such
Corporate Transaction) will beneficially own, directly
or indirectly, 20% or more of, respectively, the
outstanding shares of common stock of the corporation
resulting from such Corporate Transaction or the
combined voting power of the outstanding voting
securities of such corporation entitled to vote
generally in the election of directors except to the
extent that such ownership existed with respect to the
Company prior to the Corporate Transaction and (3)
individuals who were members of the Incumbent Board
will constitute at least a majority of the board of
directors of the corporation resulting from such
Corporate Transaction; or
(iv) The approval by the stockholders of the Company of
a complete liquidation or dissolution of the Company.
(g) "Change in Control Price" shall mean the higher of (a)
the Fair Market Value of a Share on the day of
cancellation of an Award, and (b) the highest cash
purchase price per Share paid in a Corporate
Transaction.
(h) "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
(i) "Committee" means the committee, as specified in
Article 3, appointed by the Board to administer the
Plan with respect to grants of Awards, or (unless
otherwise stated) its designee pursuant to a delegation
by the Committee as contemplated by Section 3.2.
(j) "Company" means Premark International, Inc., a Delaware
corporation, or any successor thereto as provided in
Article 17 herein.
(k) "Director" means any individual who is a member of the
Board of Directors of the Company.
(l) "Employee" means any full-time, nonunion employee of
the Company or of the Company's Subsidiaries.
Directors who are not otherwise employed by the Company
shall not be considered Employees under this Plan.
(m) "Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, or any successor
Act thereto.
(n) "Fair Market Value" shall mean the average of the
highest and lowest quoted selling prices for Shares on
the relevant date, or (if there were no sales on such
date) the average of the highest and lowest quoted
selling prices on the nearest day before and/or the
nearest day after the relevant date, as determined by
the Committee.
(o) "Freestanding SAR" means a SAR that is granted
independently of any Options pursuant to Section 7.1
herein.
(p) "Incentive Stock Option" or "ISO" means an option to
purchase Shares, granted under Article 6 herein, which
is designated as an Incentive Stock Option and is
intended to meet the requirements of Section 422 of the
Code.
(q) "Insider" shall mean an Employee who is, on the
relevant date, an officer, director, or ten percent
(10%) beneficial owner of the Company, as defined under
Section 16 of the Exchange Act.
(r) "Nonqualified Stock Option" or "NQSO" means an option
to purchase Shares, granted under Article 6 herein,
which is not intended to be an Incentive Stock Option.
(s) "Option" means an Incentive Stock Option or a
Nonqualified Stock Option.
(t) "Option Price" means the price at which a Share may be
purchased by a Participant pursuant to an Option, as
determined by the Committee.
(u) "Participant" means an Employee of the Company who has
outstanding an Award granted under the Plan.
(v) "Performance Award" means an Award granted to an
Employee, as described in Article 9 herein, including
Performance Units and Performance Shares.
(w) "Performance Period" means a time period during which
performance goals established in connection with
Performance Awards must be met.
(x) "Performance Unit" means an Award granted to an
Employee, as described in Article 9 herein.
(y) "Performance Share" means an Award granted to an
Employee, as described in Article 9 herein.
(z) "Period of Restriction" or "Period" means the period or
periods during which the transfer of Shares of
Restricted Stock is limited based on the passage of
time, and the Shares are subject to a substantial risk
of forfeiture, as provided in Article 8 herein.
(aa) "Person" shall have the meaning ascribed to such term
in Section 3(a)(9) of the Exchange Act and used in
Sections 13(d) and 14(d) thereof, including a "group"
as defined in Section 13(d).
(ab) "Prior Plans" means, collectively, the Premark
International, Inc. Stock Option Plan, the Premark
International, Inc. Restricted Stock Plan, the Premark
International, Inc. Performance Unit Plan, the Premark
International, Inc. Annual Incentive Plan, and the
Premark International, Inc. Phantom Stock Unit
Appreciation Plan.
(ac) "Restricted Stock" means an Award granted to a
Participant pursuant to Article 8 herein, the receipt
of which shall be subject solely to the Period of
Restriction.
(ad) "Share" means a share of common stock of the Company.
(ae) "Subsidiary" or "Subsidiaries" means any corporation or
corporations in which the Company owns directly, or
indirectly through subsidiaries, at least fifty percent
(50%) of the total combined voting power of all classes
of stock, or any other entity (including, but not
limited to, partnerships and joint ventures) in which
the Company owns at least fifty percent (50%) of the
combined equity thereof.
(af) "Stock Appreciation Right" or "SAR" means an Award,
granted alone (Freestanding SAR) or in connection with
a related Option (Tandem SAR), designated as a SAR,
pursuant to the terms of Article 7 herein.
(ag) "Tandem SAR" means an SAR that is granted in connection
with a related Option pursuant to Section 7.1 herein,
the exercise of which shall require forfeiture of the
right to purchase a Share under the related Option (and
when a Share is purchased under the Option, the Tandem
SAR shall similarly be cancelled).
(ah) "Window Period" means the period beginning on the third
business day following the date of public release of
the Company's quarterly sales and earnings information,
and ending on the twelfth business day following such
date.
Article 3. Administration
3.1 The Committee. The Plan shall be administered by the
Compensation and Employee Benefits Committee of the Board, or by
any other Committee appointed by the Board consisting of not less
than three (3) Directors who are not Employees; provided,
however, that upon the date that the Plan is declared by the
Board to be governed by rules under Section 16 of the Exchange
Act effective May 1, 1991, as amended, such Committee may consist
of not less than two (2) Directors who are not Employees. The
members of the Committee shall be appointed from time to time by,
and shall serve at the discretion of, the Board of Directors.
The Committee shall be composed solely of Directors who are
eligible to administer the Plan pursuant to Rule 16b-3 under the
Exchange Act. However, if for any reason the Committee does not
qualify to administer the Plan, as contemplated by Rule 16b-3 of
the Exchange Act, the Board of Directors may appoint a new
Committee so as to comply with Rule 16b-3.
3.2 Authority of the Committee. The Committee shall
have full power except as limited by law or by the Company's
Restated Certificate of Incorporation or Bylaws, and subject to
the provisions herein, to determine the size and types of Awards;
to determine the terms and conditions of such Awards in a manner
consistent with the Plan; to construe and interpret the Plan and
any agreement or instrument entered into under the Plan; to
establish, amend, or waive rules and regulations for the Plan's
administration; and (subject to the provisions of Article 15
herein) to amend the terms and conditions of any outstanding
Award to the extent such terms and conditions are within the
discretion of the Committee as provided in the Plan. Further, the
Committee shall make all other determinations which may be
necessary or advisable for the administration of the Plan. The
Committee may delegate its duties under the Plan in whole or in
part, on such terms and conditions as it shall determine, to the
Chief Executive Officer of the Company and to other senior
officers of the Company and its Subsidiaries, except that (i)
only the Committee may select and make other decisions as to
Awards to Participants who are subject to Section 16 of the
Exchange Act, and (ii) no delegation shall be made if the
consequence of such delegation would adversely affect the
compliance of the Plan with the conditions established by Rule
16b-3 for exemption from Section 16 of the Exchange Act (or any
successor provisions) or adversely affect the compliance of the
Plan with Section 162(m) of the Code (or any successor
provisions) and any regulations promulgated thereunder.
3.3 Decisions Binding. All determinations and decisions
made by the Committee pursuant to the provisions of the Plan and
all related orders or resolutions of the Board of Directors shall
be final, conclusive, and binding on all persons, including the
Company, its stockholders, Employees, Participants, and their
estates and Beneficiaries.
Article 4. Shares Subject to the Plan
4.1 Number of Shares. Subject to adjustment as provided in
Section 4.3 herein, the total number of Shares available for
grant under the Plan may not exceed one million one hundred fifty
thousand (1,150,000) plus the number of Shares reserved for Stock
Option use under the Prior Plans and transferred to this Plan
pursuant to Article 19; provided, however, that if during the
term of the Plan the Company repurchases Shares, additional
Options may be granted equal to the number of Shares so
repurchased, except that no more than one million five hundred
thousand (1,500,000) additional Shares shall be authorized for
Options under this proviso; and provided further that the total
number of such available Shares that may be used for Restricted
Stock Awards under the Plan shall be limited to one hundred fifty
thousand (150,000) plus the number of Shares reserved for
Restricted Stock use under the Prior Plans and transferred to
this Plan pursuant to Article 19. These Shares may be either
authorized but unissued or reacquired Shares.
The following rules will apply for purposes of the determi-
nation of the number of Shares available for grant under the
Plan:
(a) While an Award is outstanding, it shall be counted
against the authorized pool of Shares, regardless of
its vested status.
(b) The grant of an Option or Restricted Stock shall reduce
the Shares available for grant under the Plan by the
number of Shares subject to such Award.
(c) The grant of a Tandem SAR shall not reduce the number
of Shares available for grant by the number of Shares
subject to the related Option (i.e., there is no double
counting of Options and their related Tandem SARs).
(d) The grant of a Freestanding SAR shall reduce the number
of Shares available for grant by the number of
Freestanding SARs granted.
(e) The Committee shall reduce the appropriate number of
Shares from the authorized pool where a Performance
Award is payable in Shares.
(f) The Shares subject to outstanding Awards under Prior
Plans which are transferred to this Plan in accordance
with Article 19 shall not reduce the number of Shares
available for grant hereunder. The number of Shares
reserved for use under the Prior Plans, upon transfer
to this Plan in accordance with Article 19, shall be in
addition to the total amount of Shares available for
grant under this Plan as set forth in the first
sentence of this Section 4.1.
4.2 Lapsed Awards. If any Award granted under this Plan is
cancelled, forfeited, terminates, expires, or lapses for any
reason (with the exception of the termination of a Tandem SAR
upon exercise of the related Option or the termination of a
related Option upon exercise of the corresponding Tandem SAR),
any Shares subject to such Award again shall be available for the
grant of an Award under the Plan. However, in the event that
prior to the Award's cancellation, forfeiture, termination,
expiration, or lapse, the holder of the Award at any time
received one or more "benefits of ownership" pursuant to such
Award (as defined by the Securities and Exchange Commission,
pursuant to any rule or interpretation promulgated under
Section 16 or any successor rule of the Exchange Act), the Shares
subject to such Award shall not be made available for regrant
under the Plan to Insiders, but shall be available for regrants
under the Plan to Participants who are not Insiders.
4.3 Adjustments in Authorized Shares and Prices. In the
event of any merger, reorganization, consolidation,
recapitalization, separation, liquidation, stock dividend, split-
up, spin-off, Share combination, or other change in the corporate
structure of the Company affecting the Shares, such adjustment
shall be made in the number and class of Shares which may be
delivered under the Plan, and in the number, class and/or price
of Shares subject to outstanding Awards granted under the Plan,
as may be determined to be appropriate and equitable by the
Committee, in its sole discretion, to prevent dilution or
enlargement of rights; and provided that the number of Shares
subject to any Award shall always be a whole number.
Article 5. Eligibility and Participation
5.1 Eligibility. Persons eligible to participate in this
Plan include all Employees of the Company and its Subsidiaries,
as determined by the Committee, including Employees who are
members of the Board, but excluding Directors who are not
Employees.
5.2 Actual Participation. Subject to the provisions of the
Plan, the Committee may, from time to time, select from all
eligible Employees, those to whom Awards shall be granted and
shall determine the nature and amount of each Award.
Article 6. Stock Options
6.1 Grant of Options. Subject to the terms and provisions
of the Plan, Options may be granted to Employees at any time and
from time to time as shall be determined by the Committee. The
Committee shall have discretion in determining the number of
Shares subject to Options granted to each Participant. The
Committee may grant ISOs, NQSOs, or a combination thereof. The
maximum number of Options which are available under the Plan for
award to any individual Participant over the duration of the Plan
shall not exceed ten percent (10%) of the amount of shares
available under the Plan for issuance in the form of Options, as
may be adjusted pursuant to the Plan.
6.2 Award Agreement. Each Option grant shall be evidenced
by an Award Agreement that shall specify the Option Price, the
duration of the Option, the number of Shares to which the Option
pertains, and such other provisions as the Committee shall
determine. The Option Agreement also shall specify whether the
Option is intended to be an ISO within the meaning of Section 422
of the Code, or a NQSO whose grant is intended not to fall under
Section 422 of the Code.
6.3 Option Price. The Option Price for each grant of an
Option shall be determined by the Committee; provided that the
Option Price shall not be less than the Fair Market Value of a
Share on the date the Option is granted, subject to adjustment
pursuant to Section 4.3 herein. Options may not be repriced
without shareholder approval.
6.4 Duration of Options. Each Option shall expire at such
time as the Committee shall determine at the time of grant;
provided, however, that no Option shall be exercisable later than
the tenth (10th) anniversary date of its grant.
6.5 Exercise of Options. Options granted under the
Plan shall be exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in each
instance approve, which need not be the same for each grant or
for each Participant. However, in no event may any Option granted
under this Plan become exercisable prior to six (6) months
following the date of its grant.
6.6 Payment. (a) Options shall be exercised by the delivery
of a written notice of exercise to the Company, setting forth the
number of Shares with respect to which the Option is to be
exercised, accompanied by full payment for the Shares.
(b) The Option Price upon exercise of any Option shall be
payable to the Company in full either: (i) in cash or its equiva-
lent, or (ii) by tendering to the Company, or certifying
ownership by the Participant to the satisfaction of the Company
of, previously acquired Shares having an aggregate Fair Market
Value at the time of exercise equal to the total Option Price
(provided that the Shares which are tendered or certified must
have been held by the Participant for at least six (6) months
prior to their tender or certification), or (iii) by a
combination of (i) and (ii).
(c) The Committee also may allow cashless exercise as
permitted under Federal Reserve Board's Regulation T, subject
to applicable securities law restrictions, or by any other means
which the Committee determines to be consistent with the Plan's
purpose and applicable law.
(d) As soon as practicable after receipt of a written
notification of exercise and full payment, the Company shall
deliver to the Participant Share certificates in an appropriate
amount based upon the number of Shares purchased under the
Option(s).
6.7 Restrictions on Share Transferability. The Committee
may impose such restrictions on any Shares acquired pursuant to
the exercise of an Option under the Plan as it may deem advisa-
ble, including, without limitation, restrictions under applicable
Federal securities laws, under the requirements of any stock
exchange or market upon which such Shares are then listed and/or
traded, and under any blue sky or state securities laws
applicable to such Shares.
6.8 Nontransferability of Options. No Options granted under
the Plan may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Further, all Options granted to
a Participant under the Plan shall be exercisable during his or
her lifetime only by such Participant. Notwithstanding the
foregoing, at the discretion of the Committee, an Award Agreement
may permit the transferability of an Option by a Participant
solely to members of the Participant's immediate family or trusts
or partnerships for the benefit of such persons.
Article 7. Stock Appreciation Rights
7.1 Grant of SARs. Subject to the terms and conditions of
the Plan, a SAR may be granted to an Employee at any time and
from time to time as shall be determined by the Committee. The
Committee may grant Freestanding SARs, Tandem SARs, or any
combination of these forms of SAR. The maximum number of SARs
which are available under the Plan for award to any individual
Participant over the duration of the Plan shall not exceed ten
percent (10%) of the amount of shares available under the Plan
for issuance in the form of SARs, as may be adjusted pursuant to
the Plan.
The Committee shall have complete discretion in determining
the number of SARs granted to each Participant (subject to
Article 4 herein) and, consistent with the provisions of the
Plan, in determining the terms and conditions pertaining to such
SARs. However, the grant price of a Freestanding SAR shall be at
least equal to the Fair Market Value of a Share on the date of
grant of the SAR. The grant price of Tandem SARs shall equal the
Option Price of the related Option. In no event shall any SAR
granted hereunder become exercisable within the first six (6)
months of its grant. SARs may not be repriced without
shareholder approval.
7.2 Exercise of Tandem SARs. Tandem SARs may be exercised
for all or part of the Shares subject to the related Option upon
the surrender of the right to exercise the equivalent portion of
the related Option. A Tandem SAR may be exercised only with
respect to the Shares for which its related Option is then
exercisable.
Notwithstanding any other provision of this Plan to the
contrary, with respect to a Tandem SAR granted in connection with
an ISO: (i) the Tandem SAR will expire no later than the expira-
tion of the underlying ISO; (ii) the value of the payout with
respect to the Tandem SAR may be for no more than one hundred
percent (100%) of the difference between the Option Price of the
underlying ISO and the Fair Market Value of the Shares subject to
the underlying ISO at the time the Tandem SAR is exercised; and
(iii) the Tandem SAR may be exercised only when the Fair Market
Value of the Shares subject to the ISO exceeds the Option Price
of the ISO.
7.3 Exercise of Freestanding SARs. Freestanding SARs may be
exercised upon whatever terms and conditions the Committee, at
its sole discretion, imposes upon them.
7.4 SAR Agreement. Each SAR grant shall be evidenced by an
Award Agreement that shall specify the grant price, the term of
the SAR, and such other provisions as the Committee shall
determine.
7.5 Term of SARs. The term of a SAR granted under the Plan
shall be determined by the Committee, at its sole discretion;
provided, however, that such term shall not exceed ten (10)
years.
7.6 Payment of SAR Amount. Upon exercise of a SAR, a
Participant shall be entitled to receive payment from the Company
in an amount determined by multiplying:
(a) The excess of the Fair Market Value of a Share on the
date of exercise over the grant price of the SAR; by
(b) The number of Shares with respect to which the SAR is
exercised.
At the discretion of the Committee, the payment upon SAR
exercise may be in cash, in Shares of equivalent value, or in
some combination thereof.
7.7 Rule 16b-3 Requirements. Notwithstanding any other
provision of the Plan, the Committee may impose such conditions
on exercise of a SAR (including, without limitation, the right of
the Committee to limit the time of exercise to specified periods)
as may be required to satisfy the requirements of any rule or
interpretation promulgated under Section 16 (or any successor
rule) of the Exchange Act.
7.8 Nontransferability of SARs. No SAR granted under
the Plan may be sold, transferred, pledged, assigned, or other-
wise alienated or hypothecated, other than by will or by the laws
of descent and distribution. Further, all SARs granted to a
Participant under the Plan shall be exercisable during his or her
lifetime only by such Participant. Notwithstanding the
foregoing, at the discretion of the Committee, an Award Agreement
may permit the transferability of a SAR by a Participant solely
to members of the Participant's immediate family or trusts for
the benefit of such persons.
Article 8. Restricted Stock
8.1 Grant of Restricted Stock. Subject to the terms and
provisions of the Plan, the Committee, at any time and from time
to time, may grant Shares of Restricted Stock to eligible
Employees in such amounts as the Committee shall determine.
8.2 Restricted Stock Agreement. Each Restricted Stock grant
shall be evidenced by a Restricted Stock Agreement that shall
specify the Period of Restriction, or Periods, the number of
Restricted Stock Shares granted, and such other provisions as the
Committee shall determine.
8.3 Transferability. Except as provided in this Article 8,
the Shares of Restricted Stock granted herein may not be sold,
transferred, pledged, assigned, or otherwise alienated or
hypothecated until the end of the applicable Period of
Restriction established by the Committee and specified in the
Restricted Stock Agreement, or upon earlier satisfaction of any
other conditions, as specified by the Committee in its sole
discretion and set forth in the Restricted Stock Agreement.
All rights with respect to the Restricted Stock granted to a
Participant under the Plan shall be available during his or her
lifetime only to such Participant. Notwithstanding the
foregoing, at the discretion of the Committee, an Award Agreement
may permit the transferability of a Restricted Stock Award by a
Participant solely to members of the Participant's immediate
family or trusts or partnerships for the benefit of such persons,
subject to any Period of Restriction.
8.4 Certificate Legend. Each certificate representing
Shares of Restricted Stock granted pursuant to the Plan may bear
the following legend:
"The sale or other transfer of the Shares
of stock represented by this certificate,
whether voluntary, involuntary, or by
operation of law, is subject to certain
restrictions on transfer as set forth in the
Premark International, Inc. 1994 Incentive
Plan, and in a Restricted Stock Agreement. A
copy of the Plan and such Restricted Stock
Agreement may be obtained from Premark
International, Inc."
The Company shall have the right to retain the certificates
representing Shares of Restricted Stock in the Company's
possession until such time as all conditions and/or restrictions
applicable to such Shares have been satisfied.
8.5 Removal of Restrictions. Except as otherwise provided
in this Article 8, Shares of Restricted Stock covered by each
Restricted Stock grant made under the Plan shall become freely
transferable by the Participant after the last day of the Period
of Restriction. Once the Shares are released from the
restrictions, the Participant shall be entitled to have the
legend required by Section 8.4 removed from his or her Share
certificate.
8.6 Voting Rights. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder
may exercise full voting rights with respect to those Shares.
8.7 Dividends and Other Distributions. The Committee shall
have the discretion to determine whether Participants who have
been granted Restricted Stock will be entitled to dividends and
other distributions paid on Shares during the Period of
Restriction, and if so, the date of receipt. If any such
dividends or distributions are paid in Shares, the Shares shall
be subject to the same restrictions on transferability and
forfeitability as the Shares of Restricted Stock with respect to
which they were paid. In the event that any dividend constitutes
a "derivative security" or an "equity security" pursuant to
Rule 16(a) under the Exchange Act, such dividend shall be subject
to a vesting period equal to the longer of: (i) the remaining
vesting period of the Shares of Restricted Stock with respect to
which the dividend is paid; or (ii) six months. The Committee
shall establish procedures for the application of this provision.
8.8 Period of Restriction. Any Restricted Stock Award
granted hereunder shall have a Period of Restriction of not less
than three years, except in the following circumstances:
(a) Any Restricted Stock Award which includes a
performance-based condition may have a Period of
Restriction as short as one year; and
(b) An aggregate amount of Restricted Stock Awards not
exceeding three percent (3%) of the Shares available
pursuant to Section 4.1 of the Plan, excluding Shares
transferred to this Plan from Prior Plans pursuant to
Article 19, may be issued without a minimum Period of
Restriction.
Article 9. Performance Awards
9.1 Grant of Performance Awards. Subject to the terms of
the Plan, Performance Awards may be granted to eligible Employees
at any time and from time to time, as shall be determined by the
Committee. The Committee shall have complete discretion in
determining the number, amount and timing of Awards granted to
each Participant. Such Performance Awards may take the form
determined by the Committee, including without limitation, cash,
Shares, Performance Units and Performance Shares, or any
combination thereof. Performance Awards may be awarded as short-
term or long-term incentives.
9.2 Performance Goals. (a) The Committee shall set
performance goals at its discretion which, depending on the
extent to which they are met, will determine the number and/or
value of Performance Awards that will be paid out to the
Participants, and may attach to such Performance Awards one or
more restrictions, including, without limitation, a requirement
that Participants pay a stipulated purchase price for each
Performance Share, or restrictions which are necessary or
desirable as a result of applicable laws or regulations.
Performance goals may be based upon, without limitation, Company-
wide, divisional, project team, and/or individual performance.
(b) The Committee shall have the authority at any time to
make adjustments to performance goals for any outstanding
Performance Awards which the Committee deems necessary or
desirable unless at the time of establishment of goals the
Committee shall have precluded its authority to make such
adjustments.
(c) Performance Periods shall, in all cases, exceed six (6)
months in length.
9.3 Value of Performance Units/Shares. (a) Each Performance
Unit shall have an initial value that is established by the
Committee at the time of grant.
(b) Each Performance Share shall have an initial value equal
to the Fair Market Value of a Share on the date of grant.
9.4 Earning of Performance Awards. After the applicable
Performance Period has ended, the holder of Performance Awards
shall be entitled to receive the payout earned by the Participant
over the Performance Period, to be determined as a function of
the extent to which the corresponding performance goals have been
achieved, except as adjusted pursuant to Section 9.2(b) or as
deferred pursuant to Article 11.
9.5 Timing of Payment of Performance Awards. Payment of
earned Performance Awards shall be made in accordance with terms
and conditions prescribed or authorized by the Committee.
Participants may elect to defer, or the Committee may require the
deferral of, the receipt of Performance Awards upon such terms as
the Committee deems appropriate.
9.6 Nontransferability. Performance Awards may not be sold,
transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, a Participant's rights under the Plan
shall be exercisable during the Participant's lifetime only by
the Participant or the Participant's Beneficiary.
Notwithstanding the foregoing, at the discretion of the
Committee, an Award Agreement may permit the transferability of a
Performance Award by a Participant solely to members of the
Participant's immediate family or trusts or partnerships for the
benefit of such persons.
Article 10. Beneficiary
10.1 Designation. Each Participant under the Plan may, from
time to time, name any Beneficiary or Beneficiaries (who may be
named contingently or successively). Each such designation shall
revoke all prior designations by the same Participant, shall be
in a form prescribed by the Company, and shall be effective only
when filed by the Participant in writing with the Company during
the Participant's lifetime. Any such designation shall control
over any inconsistent testamentary or intervivos transfer by a
Participant, and any benefit of a Participant under the Plan
shall pass automatically to a Participant's Beneficiary pursuant
to a proper designation pursuant to this Section 10.1 without
administration under any statute or rule of law governing the
transfer of property by will, trust, gift or intestacy.
10.2 Absence of Designation. In the absence of any such
designation contemplated by Section 10.1, benefits remaining
unpaid at the Participant's death shall be paid pursuant to the
Participant's will or pursuant to the laws of descent and
distribution.
Article 11. Deferrals
The Committee may permit a Participant to elect, or the
Committee may require at its sole discretion subject to the
proviso set forth below, any one or more of the following: (i)
the deferral of the Participant's receipt of cash, (ii) a delay
in the exercise of an Option or SAR, (iii) a delay in the lapse
or waiver of restrictions with respect to Restricted Stock, or
(iv) a delay of the satisfaction of any requirements or goals
with respect to Performance Awards; provided, however, the
Committee's authority to take such actions hereunder shall exist
only to the extent necessary to reduce or eliminate a limitation
on the deductibility of compensation paid to the Participant
pursuant to (and so long as such action in and of itself does not
constitute the exercise of impermissible discretion under)
Section 162(m) of the Code, or any successor provision
thereunder. If any such deferral is required or permitted, the
Committee shall establish rules and procedures for such
deferrals, including provisions relating to periods of deferral,
the terms of payment following the expiration of the deferral
periods, and the rate of earnings, if any, to be credited to any
amounts deferred thereunder.
Article 12. Rights of Employees
12.1 Employment. Nothing in the Plan shall interfere with or
limit in any way the right of the Company to terminate any
Participant's employment at any time, nor confer upon any
Participant any right to continue in the employ of the Company.
For purposes of the Plan, transfer of employment of a Participant
between the Company and any one of its Subsidiaries (or between
Subsidiaries) shall not be deemed a termination of employment.
12.2 Participation. No Employee shall have the right to be
selected to receive an Award under this Plan, or, having been so
selected, to be selected to receive a future Award.
Article 13. Change in Control
13.1 Acceleration of Vesting. Notwithstanding any other
provision of the Plan to the contrary, in the event of a Change
in Control, any Awards outstanding and not then exercisable and
vested as of the date such Change in Control is determined to
have occurred, shall become fully exercisable and vested to the
full extent of the original grant. Upon termination of
employment occurring as a consequence of a Change in Control, as
determined by the Committee, an Option shall remain exercisable
for seven months following such termination or until the
expiration of the stated term of such Option, whichever period is
shorter.
13.2 Surrender in Lieu of Acceleration. During the 60-day
period from and after a Change in Control, (the "Exercise
Period"), a Participant who holds an Option shall have the right,
in lieu of the payment of the exercise price for the Shares being
purchased under the Option and by giving notice to the Company,
to elect (within the Exercise Period) to surrender all or part of
an Option to the Company and to receive cash, within 30 days of
such notice, in an amount equal to the amount by which the Change
in Control Price per Share on the date of such election shall
exceed the exercise price per Share under the Option (the
"Spread") multiplied by the number of Shares granted under the
Option as to which the right granted under this Section shall
have been exercised; provided, however, that if the Change in
Control is within six (6) months of the date of grant of a
particular Option held by a Participant no such election shall be
made by such Participant with respect to such Option prior to six
(6) months from the date of grant. If the end of such 60-day
period from and after a Change in Control is within six (6)
months from the date of grant of an Option or the date of an
Award, such Option or Award shall be cancelled in exchange for a
cash payment to any Participant subject to Section 16 under the
Exchange Act, effected on the day which is six (6) months and one
day after the date of grant of such Option or Award, as the case
may be, equal to (a) in the case of an Option, the Spread
multiplied by the number of Shares granted under the Option, or
(b) in the case of an Award, the Change in Control Price
multiplied by the number of Shares comprising an outstanding
Award. Notwithstanding the foregoing, if any right granted
pursuant to this Section 13.2 would make a Change in Control
transaction ineligible for pooling of interests accounting under
the provisions of the Accounting Principles Board's Opinion No.
16 that but for this Section 13.2 would otherwise be eligible for
such accounting treatment, the Committee shall have the ability
to substitute the cash payable pursuant to this Section 13.2
with shares of common stock having a Fair Market Value equal to
the cash that would otherwise be payable hereunder and which will
not render the Change in Control transaction ineligible for
pooling of interests accounting.
Article 14. Death and Termination
The Committee shall have the authority to establish
provisions from time to time governing the exercisability,
vesting, forfeiture, payout or amount of Awards in respect of a
Participant's death or disability, or termination of employment,
whether as a consequence of retirement, resignation, involuntary
termination or otherwise.
Article 15. Amendment, Modification, and Termination
15.1 Amendment, Modification, and Termination. At any time
and from time to time, the Board may terminate, amend, or modify
the Plan. However, without the approval of the stockholders of
the Company (as may be required by the Code, by the short-swing
profit rules of Section 16 of the Exchange Act, by any national
securities exchange or system on which the Shares are then listed
or reported, or by a regulatory body having jurisdiction with
respect hereto), no such amendment or modification may:
(a) Increase the total number of Shares which may be issued
under this Plan, except as provided in Article 4
hereof; or
(b) Modify the eligibility requirements; or
(c) Materially increase the benefits accruing under
the Plan.
15.2 Awards Previously Granted. No termination, amendment,
or modification of the Plan shall adversely affect in any
material way any Award previously granted under the Plan, without
the written consent of the Participant holding such Award. The
Committee shall have the right to replace any previously-granted
Award under the Plan with an Award equal to the value of the
replaced Award at the time of replacement, without obtaining the
consent of the Participant holding such Award.
Article 16. Withholding
16.1 Tax Withholding. The Company shall have the power and
the right to deduct or withhold, or require a Participant to
remit to the Company, an amount sufficient to satisfy Federal,
state, and local taxes (including the Participant's FICA obliga-
tion) required by law to be withheld with respect to any taxable
event arising under or as a result of this Plan.
16.2 Share Withholding. With respect to withholding required
and/or permitted upon the exercise of Options or SARs, upon the
lapse of restrictions on Restricted Stock, or upon any other
taxable event hereunder, Participants may elect, subject to the
approval of the Committee, to satisfy the withholding
requirement, in whole or in part, by having the Company withhold
Shares (or by surrendering Shares previously owned which have
been held for longer than six months) having a Fair Market Value
on the date the tax is to be determined equal to the minimum
statutory total tax which could be imposed on the transaction.
All elections shall be irrevocable, made in writing, signed by
the Participant, and elections by Insiders shall additionally
comply with the requirements established by the Committee.
Article 17. Successors
All obligations of the Company under the Plan, with respect
to Awards granted hereunder, shall be binding on any successor to
the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation,
spin-off, or otherwise, of all or substantially all of the
business and/or assets of the Company.
Article 18. Legal Construction
18.1 Gender and Number. Except where otherwise indicated by
the context, any masculine term used herein also shall include
the feminine; the plural shall include the singular and the
singular shall include the plural.
18.2 Severability. In the event any provision of the Plan
shall be held illegal or invalid for any reason, the illegality
or invalidity shall not affect the remaining parts of the Plan,
and the Plan shall be construed and enforced as if the illegal or
invalid provision had not been included.
18.3 Requirements of Law. The granting of Awards and the
issuance of Shares under the Plan shall be subject to all
applicable laws, rules, and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may
be required. With respect to Insiders, transactions under this
Plan are intended to comply with all applicable conditions of
Rule 16b-3 or its successors under the Exchange Act. To the
extent any provision of the plan or action by the Committee fails
to comply with Section 18.3, it shall be deemed null and void, to
the extent permitted by law and deemed advisable by the
Committee.
Notwithstanding any other provision set forth in the Plan,
if required by any rule or interpretation promulgated under
Section 16 of the Exchange Act, any "derivative security" or
"equity security" offered pursuant to the Plan to any Insider may
not be sold or transferred for at least six (6) months after the
date of grant of such Award. The terms "equity security" and
"derivative security" shall have the meanings ascribed to them in
the then-current Rule 16(a) under the Exchange Act.
18.4 Governing Law. To the extent not preempted by Federal
law, the Plan, and all agreements hereunder, shall be construed
in accordance with and governed by the laws of the State of
Illinois.
Article 19. Prior Plans
Upon the approval by the Company's shareholders of this
Plan, all outstanding grants and awards under the Prior Plans, as
well as any Shares then-reserved for use under the Prior Plans,
shall be deemed transferred to this Plan. The terms and
conditions of any agreements issued pursuant to any of the Prior
Plans shall remain unchanged and in full force and effect.
<PAGE>
EXHIBIT 4.2
FORM OF STOCK OPTION AGREEMENT
1. Option Grant. Premark International, Inc., a Delaware
corporation ("Premark"), pursuant to the Premark International,
Inc. 1994 Incentive Plan (the "Plan"), a copy of which is
attached, hereby grants to the Optionee as of the Date of Grant
an option to purchase from Premark a number of shares of the
common stock of Premark, $1.00 par value ("Common Stock"), at the
Option Price, all as specifically indicated above. The Option
Term shall mean the period which begins on the Date of Grant and
ends on the date the Option Term Expires, as set forth above.
The option is exercisable in accordance with the terms and
conditions of this Agreement and the Plan. The Optionee shall
execute and return this Agreement to Premark. If Premark
determines that any agreement from the Optionee is appropriate in
order to comply with any listing, registration or other legal
requirement, the Optionee shall execute and deliver such
agreement to Premark. All determinations and interpretations
made by Premark in connection with any question arising under
this Agreement or the Plan shall be binding and conclusive upon
the Optionee or his or her legal representative.
2. Exercise Period. This option shall become exercisable
as set forth above. Any portion of the option which becomes
exercisable shall continue to be exercisable, until exercised,
during the term which begins on the date the Exercise Rights
Begin and ends on the date the Option Term Expires. Exceptions
to this general rule shall apply in the event of termination of
employment, a death or a Change of Control, as provided in
Paragraphs 6, 7 and 8 of this Agreement.
3. Exercise Procedure. Options are exercised by delivering
a written notice to Premark specifying the number of shares to be
purchased, and by including payment in full, or arrangements
satisfactory to Premark for payment in full, of the Option Price
for such shares. Premark shall make available to the Optionee a
form that may be used for this purpose. At least five shares
must be purchased at any one time unless fewer than five shares
remain subject to this option. The date of exercise shall be the
date on which such notice and payment, or arrangements
satisfactory to Premark for payment, are received by Premark.
4. Payment of the Option Price. As provided under Article
6 of the Plan, payment of the Option Price for the number of
shares to be purchased shall be made (i) in cash (including a
check, bank draft or money order), (ii) by delivery to Premark,
or by certifying to Premark's satisfaction the ownership, of
shares of Common Stock having a fair market value at least equal
to the Option Price for such shares, or (iii) by any combination
of (i) and (ii). For this purpose, the "fair market value" of
Common Stock shall be the closing price of a share of Common
Stock on the Composite Tape for New York Stock Exchange Listed
Stocks on the day before the date of exercise or, if there is no
reported sale on that day, on the last preceding date on which a
reported sale occurred.
5. Delivery of Certificate(s). Upon any exercise of this
option and subject to the payment of tax obligations under
Section 9 of this Agreement, Premark shall deliver the
certificate(s) representing the number of shares purchased. The
certificate(s) shall be registered in the name of the Optionee,
or if the Optionee so requests in writing at the time of
exercise, jointly in the name of the Optionee and another person
with rights of survivorship. If the Optionee dies, the
certificate(s) shall be registered in the name of the person
entitled to exercise this option in accordance with Paragraph 7
of the Agreement.
6. Termination of Employment. (a) If the Optionee shall
voluntarily resign employment from Premark or any Subsidiary (as
defined in Section 2 of the Plan) or retire from Premark or any
Subsidiary before age 65 and without the permission of the
Committee, the Optionee may, within a period of thirty days
following termination of employment but in no event after the
date the Option Term Expires as provided above, exercise the
option to the extent the Option was exercisable on the date of
termination of employment.
(b) If the Optionee shall cease to be employed by Premark
or any Subsidiary because that person was terminated by Premark
or any Subsidiary, other than for cause (as determined by
Premark), the option shall continue to become exercisable during
the period of one year following termination of employment, and
the Optionee may exercise the option during the one-year period
to the extent the option is exercisable or becomes exercisable.
Notwithstanding the foregoing, the option may not become
exercisable or be exercised after the date the Option Term
Expires as provided above.
(c) If the Optionee shall cease to be employed by Premark
or any Subsidiary because that person (i) became disabled, (ii)
retired from Premark or any Subsidiary on or after age 65, or
(iii) retired prior to age 65 with the permission of the
Committee, the option shall continue to become exercisable during
the period of three years following termination of employment,
and the Optionee may esercise the option during the three-year
period to the extent the option is exercisable or becomes
exercisable. Notwithstanding the foregoing, the option may not
become exercisable or be exercised after the date the Option Term
Expires as provided above.
(d) Notwithstanding Section 6(c) above, if the Optionee
becomes disabled, or retires with the permission of the
Committee, and is determined at the time of either such event by
Premark to be an eligible senior executive of Premark or any
Subsidiary for purposes of this section, the option shall
continue to become exercisable and may be exercised through the
date the Option Term Expires as provided above.
(e) If the Optionee's employment with Premark or any
Subsidiary is terminated for cause (as determined by Premark),
all rights to exercise the option shall expire upon Optionee's
receipt of written notice of termination of employment.
7. Death of an Optionee. If the Optionee dies while
employed by Premark or any Sudsidiary, or while entitled to
Extraordinary Exercise Rights if such rights so provide, the
option to purchase shares hereunder shall become immediately and
fully exercisable by the person to whom the option is transferred
by will or the laws of descent and distribution and may be
exercised within one year following the Optionee's death, but not
later than the end of the Option Term. If the Optionee dies
after termination of employment with Premark or any Sudsidiary,
the option may be exercised by such person only to the extent the
option was exercisable on the date of death and only on or before
the earliest of (a) one year following Optionee's death, (b) the
last date on which the Optionee could have exercised the option
had he or she not died, or (c) end of the Option Term.
8. Change of Control. In the event of a Change of Control
(as defined in Section 2 of the Plan), this option to purchase
shares shall become immediately and fully exercisable, subject to
Article 13 of the Plan and shall remain exercisable throughout
such Option Term. If the Optionee shall exercise all or a
portion of the option to purchase shares hereunder during the 60-
day period following a Change of Control, the Optionee may elect
either to pay the Option price to purchase such shares or to
surrender all or part of such option to Premark and receive cash
in accordance with the provisions of the Plan.
9. Withholding Tax. Upon any exercise of this option, the
Optionee or other person entitled to receive shares of Common
Stock pursuant to such exercise will be obligated to pay to
Premark the amount of any taxes which Premark determines the
Optionee's employer is required to withhold with respect to such
shares. In lieu of a cash payment of such amount, Premark shall
have the right to retain, or sell without notice, a sufficient
number of such shares to cover the amount required to be
withheld. If, however, the Optionee is an officer or director of
Premark (within the meaning of Section 16 of the Securities
Exchange Act of 1934), Premark shall not retain, or sell without
notice, such shares unless the Optionee exercises the option
within the ten business day period beginning on the third
business day following the date of Premark's release of a
quarterly or annual summary statement of sales and earnings, or
irrevocably elects to have shares withheld in satisfaction of
taxes required to be withheld by the employer, which election
shall take effect six months after the date of such election.
10. Transferability. In accordance with Section 6.8 of the
Plan, the option may not be assigned, encumbered or transferred.
During the lifetime of the Optionee, the option may be exercised
only by the Optionee. If the Optionee dies, the option may be
transferred in accordance with Section 7 of the Agreement.
11. Notices. All notices hereunder to Premark shall be
delivered or mailed to the Corporate Secretary of Premark
International, Inc. at its headquarters office. All notices
hereunder to the Optionee shall be delivered personally or mailed
to the Optionee's address indicated below, unless the Optionee
notifies Premark in writing of a change of address.
12. Assumption of Risk. It is expressly understood and
agreed that the Optionee assumes all risks incident to any change
hereafter in applicable laws or regulations, or incident to any
change in the market value of the Common Stock after the exercise
of this option in whole or in part.
The parties confirm this Agreement effective as of the Date
of Grant and have executed it on _______________, 199 .
PREMARK INTERNATIONAL, INC. OPTIONEE
_________________________
Signature
_________________________
Street Address
John M. Costigan _________________________
Senior Vice President City State Zip Code
<PAGE>
EXHIBIT 5
May 4, 1994
Premark International, Inc.
1717 Deerfield Road
Deerfield, Illinois 60015
RE: Premark International, Inc. Registration
Statement on Form S-8 Relating to the Premark
International, Inc. 1994 Incentive Plan
Dear Sirs:
Premark International, Inc., a Delaware corporation (the
"Company"), proposes to file a Registration Statement on Form S-8
(the "Registration Statement") under the Securities Act of 1933
(the "Act") in connection with a proposed sale to employees of
the Company of up to 2,500,000 shares of Common Stock, par value
$1.00 per share, of the Company (the "Common Stock") pursuant to
the exercise of options which have been or may be granted to such
persons under the Company's 1994 Incentive Plan (the "Plan").
As counsel to the Company, I have examined such corporate
proceedings and such other legal matters as I deemed relevant to
the authorization and issuance of the shares of Common Stock
covered by the Registration Statement. Based upon such
examination, it is my opinion that the shares of Common Stock
being sold by the Company are legally authorized and, upon the
issuance and delivery thereof and the receipt by the Company of
the purchase price therefor as provided in the Plan, will be
legally issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as Exhibit 5 to
the Registration Statement. In giving this consent, I do not
concede that I am an expert within the meaning of the Act or the
rules and regulations thereunder, or that this consent is
required by Section 7 of the Act.
Very truly yours,
John M. Costigan
EXHIBIT 23
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the
Registration Statement pertaining to the Premark International,
Inc. 1994 Incentive Plan on Form S-8 of our report dated February
11, 1994, which appears on page 41 of the 1993 Annual Report to
Shareholders of Premark International, Inc., which is
incorporated by reference in Premark International, Inc.'s Annual
Report on Form 10-K for the year ended December 25, 1993. We
also consent to the incorporation by reference of our report on
the Financial Statement Schedules, which appears on page 13 of
such Annual Report on Form 10-K.
Price Waterhouse
May 4, 1994
Chicago, Illinois
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, That the undersigned Director of
Premark International, Inc., a Delaware corporation (the
"Corporation"), hereby constitutes and appoints
each of John M. Costigan, L. John Fletcher and Thomas M. Roehlk,
and their or his substitutes or substitute, his or her true and
lawful attorney and agent, in the name and on behalf of the
undersigned, to do any and all acts and things and execute any
and all instruments which the said attorney and agent may deem
necessary or advisable to enable the Corporation to comply with
the Securities Act of 1933, as amended, and any rules and
regulations and requirements of the Securities and Exchange
Commission in respect thereof, in connection with the
registration under the Securities Act of 1933, as amended, of the
common stock, $1.00 par value, of the Corporation on a
Registration Statement on Form S-8, and to any and all
amendments, including post-effective amendments, to the said
Registration Statement, relating to the Premark International,
Inc. 1994 Incentive Plan, as the same may be amended from time to
time, including specifically, but without limiting the generality
of the foregoing, the power and authority to sign the name of the
undersigned in his or her capacity as a Director of the
Corporation, and to file the same, or cause the same to be
filed, together with exhibits, supplements, appendices,
instruments and other documents pertaining thereto, with the
Securities and Exchange Commission, and hereby ratifying and
confirming all that said attorneys and agents, and each of them,
and their or his substitute or substitutes, may have done, may do
or cause to be done by virtue hereof.
IN WITNESS WHEREOF, The undersigned has hereunto set his or her
hand this 4th day of May, 1994.
William O. Bourke Dr. Ruth M. Davis
Dr. Lloyd C. Elam Clifford J. Grum
Joseph E. Luecke Bob Marbut
John B. McKinnon Robert M. Price
Janice D. Stoney
