As filed with the Securities and Exchange Commission on January 24, 1997
Registration No. 33-
- ---------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
T. ROWE PRICE ASSOCIATES, INC.
(Exact name of registrant as specified in its charter)
100 East Pratt Street
Baltimore, Maryland 21202
Maryland (Address of principal 52-0556948
(State or other executive offices) (I.R.S.
jurisdiction of Employer
incorporation or Identification
organization) No.)
T. ROWE PRICE ASSOCIATES INC.
1996 STOCK INCENTIVE PLAN
(Full title of the plan)
GEORGE A. ROCHE Copy to:
T. Rowe Price Associates, Inc. HENRY D. KAHN
100 East Pratt Street Piper & Marbury L.L.P.
Baltimore, Maryland 21202 36 South Charles Street
(410) 345-2099 Baltimore, Maryland 21201
(410) 576-1686
(Name, address and telephone number,
including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
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Title of Amount Proposed maxi- Proposed maxi- Amount of
securities to to be mum offering mum aggregate registration
be registered registered price per share offering price fee
- ------------- ---------- --------------- -------------- ---
Common Stock 8,000,000 $43.125* $345,000,000 $104,546
(par value
$.20 per share)
- --------------------------------------------------------------------------------
*Computed in accordance with Rule 457(h)(1) and (c) based on the closing price
of the registrant's common stock on January 22, 1997.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The information required by Part I, to the extent applicable, is included
in documents sent or given to the participants in the 1996 Stock Incentive Plan
of T. Rowe Price Associates, Inc. (the "Company") pursuant to Rule 428.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
----------------------------------------
The following documents have been filed by the Company with the Securities
and Exchange Commission and are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended December
31, 1995;
(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 since December 31, 1995, the end of the
Company's fiscal year covered by the report referred to in (a) above; and
(c) the description of the Company's common stock, par value $0.20 per
share contained in its Registration Statement on Form S-1 (File No. 33-3398), as
amended by Amendment No. 1 on Form 8-A/A (File No. 0-14282).
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Securities Exchange Act of 1934 subsequent to the date of this
Registration Statement and prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which deregisters
all securities then remaining unsold shall be deemed to be incorporated by
reference into this Registration Statement and to be a part hereof from the date
of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
-------------------------
Not applicable because the class of securities to be offered is registered
under Section 12 of the Securities Exchange Act of 1934.
<PAGE>
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
--------------------------------------
Certain legal matters in connection with the issuance of the Common Stock
offered by this Registration Statement are being passed upon for the Company by
Piper & Marbury L.L.P. of Baltimore, Maryland.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
-----------------------------------------
Directors and officers of the Company are indemnified to the full extent
provided by Section 2-418 of the Corporations and Associations Article of the
Annotated Code of Maryland, and under Article EIGHTH, Section 7 of the
Registrant's charter.
As permitted under Subsection (k) of Section 2-418 of the Corporations and
Associations Article of the Annotated Code of Maryland, the Company has
purchased and maintains insurance on behalf of its directors and officers
against any liability asserted against such directors and officers in their
capacities as such whether or not the Company would have the power to indemnify
such persons under the provisions of the Maryland law governing indemnification.
Section 2 of the 1996 Stock Incentive Plan, "Administration," provides that
no member of the Board of Directors or of the committee designated to administer
the Plan "shall be liable for any action or determination made in good faith,
nor for any matter as to which the Company's charter limits the liability of
directors." Such committee members are entitled to indemnification and
reimbursement in the manner provided in the Company's charter and by-laws in
addition to coverage under any directors' and officers' liability insurance in
effect from time to time.
As permitted by Maryland Law, Article Eighth, Section 8 of the Company's
Charter limits the monetary liability of the Company's directors and officers to
the Company and its stockholders to the maximum extent permitted by Maryland law
in effect from time to time. Section 8 of Article Eighth provides as follows:
Section 8. To the fullest extent permitted by Maryland statutory or
decisional law, as amended or interpreted, no director or officer of this
Corporation shall be personally liable to the Corporation or its stockholders
for money damages. No amendment or repeal of any of its provisions shall limit
or eliminate the benefits provided to directors and officers under this
provision with respect to any act or omission which occurred prior to such
amendment or repeal.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
-----------------------------------
Not applicable.
<PAGE>
ITEM 8. EXHIBITS.
--------
Exhibit
Number Description
- ------ -----------
4.1 1996 Stock Incentive Plan of the Company (incorporated by
reference from the registrant's definitive proxy statement for
the annual meeting of stockholders held on April 12, 1996).
4.2 Form of Incentive Stock Option Agreement.
4.3 Form of Non-Qualified Stock Option Agreement.
5.1 Opinion of Piper & Marbury L.L.P., as to the legality of the
securities being offered (includes Consent of Counsel).
23.1 Consent of Piper & Marbury L.L.P. (included in the opinion
filed as Exhibit 5.1 to this Registration Statement).
23.2 Consent of Price Waterhouse LLP.
24 Power of Attorney.
ITEM 9. UNDERTAKINGS.
------------
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 Securities
Act of 1933;
(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) which, individually or in the aggregate, represent
fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high and of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
<PAGE>
(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
registration statement is on Form S-3, Form S-8, or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) 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.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the 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 Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
<PAGE>
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 Baltimore, and the State of Maryland on this 28th day
of January, 1997.
T. ROWE PRICE ASSOCIATES, INC.
By: /s/ George J. Collins
--------------------------
George J. Collins
President, Chief Executive
Officer and Managing Director
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.
Principal Executive Officer:
/s/ George J. Collins Date: January 24, 1997
- ---------------------
George J. Collins President, Chief
Executive Officer
and Managing
Director
Principal Financial Officer:
/s/ George A. Roche Date: January 24, 1997
- -------------------
George A. Roche Managing
Director and
Chief Financial Officer
Principal Accounting Officer:
/s/ Alvin M. Younger, Jr. Date: January 24, 1997
- -------------------------
Alvin M. Younger, Jr. Managing Director
Treasurer and
Secretary
<PAGE>
A Majority of the Board of Directors:
George J. Collins, Henry H. Hopkins, James A.C. Kennedy, John H. Laporte, James
S. Riepe, William T. Reynolds, George A. Roche, and M. David Testa.
By: /s/ George A. Roche For himself Date: January 24, 1997
------------------- and as
George A. Roche Attorney-in-Fact
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description Page Number
- ------ ----------- -----------
4.1 1996 Stock Incentive Plan of the Company
incorporated by reference from the registrant's
definitive proxy statement for the annual meeting of
stockholders held on April 12, 1996).
4.2 Form of Incentive Stock Option Agreement. 9
4.3 Form of Non-Qualified Stock Option Agreement. 18
5.1 Opinion of Piper & Marbury L.L.P., as to the legality
of the securities being offered (includes Consent of Counsel). 27
23.1 Consent of Piper & Marbury L.L.P. (included in the opinion 27
filed as Exhibit 5.1 to this Registration Statement).
23.2 Consent of Price Waterhouse LLP. 28
24 Power of Attorney. 29
INCENTIVE STOCK OPTION AGREEMENT
--------------------------------
pursuant to the
T. ROWE PRICE ASSOCIATES, INC.
1996 STOCK INCENTIVE PLAN
-------------------------
AGREEMENT, dated as of this __th day of ___________, _____, between T. ROWE
PRICE ASSOCIATES, INC. (the "Company"), and 1~ (the "Optionee").
WHEREAS, the Optionee is now in the employ of the Company or a Subsidiary
(as hereinafter defined) in a key capacity and the Company desires to have the
Optionee remain in such employ and to afford the Optionee the opportunity to
acquire, or enlarge, the Optionee's stock ownership in the Company so that the
Optionee may have a direct proprietary interest in the Company's success; and
WHEREAS, the Company has and its stockholders have approved the T. Rowe
Price Associates, Inc. 1996 Stock Incentive Plan (the "Plan"), pursuant to which
the Company may, from time to time, enter into stock option agreements with
certain of its eligible employees as therein defined;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
and agreements hereinafter set forth, the parties hereto hereby mutually
covenant and agree as follows:
1. Employee's Agreement.
---------------------
The Optionee agrees to remain in the employ of the Company and to render it
the Optionee's exclusive services at such compensation as shall be determined,
from time to time, by the Company for a period of one year from the date hereof,
but this Agreement shall not be deemed to limit or restrict the right of the
Company to terminate Optionee's employment at any time, for any reason, for or
without cause; provided, that the Company's sole remedy hereunder for a breach
of the employee's agreement shall be the termination of the option granted
hereunder in accordance with Section 6 hereof.
2. Grant of Option.
---------------
Subject to the terms and conditions set forth herein, the Company hereby
grants to the Optionee during the period commencing one year after the date of
<PAGE>
this Agreement and ending ten years from the date hereof (the "Option Period"),
the option to purchase from the Company at a price of $_____ per share up to but
not exceeding in the aggregate 2~ shares of the Company's Common Stock.
3. Exercise of Option.
------------------
The option granted in paragraph 2 hereof may be exercised, in whole or in
part, at any time and from time to time as follows:
(a) The aggregate number of shares of stock covered by this agreement shall
be divided into five equal installments. The first installment of 20% shall be
exercisable, in whole or in part, commencing __________, ___; the second
installment of 20% shall be exercisable, in whole or in part, commencing
__________, ____; the third installment of 20% shall be exercisable, in whole or
in part, commencing ___________, _____; the fourth installment of 20% shall be
exercisable, in whole or in part, commencing ___________, _____; and the final
installment of 20% shall be exercisable, in whole or in part, commencing,
_______________, ______.
(b) The Executive Compensation Committee of the Board of Directors of the
Company (the "Committee") may in its discretion place limitations on the extent
to which shares of Common Stock of the Company may be tendered by the Optionee
as payment upon exercise of an option pursuant to paragraph 4(a) hereof.
(c) In the case of an option not immediately exercisable in full, the
Committee may in its discretion accelerate the time at which such option may be
exercised.
(d) To the extent not exercised, installments shall accumulate and be
exercisable by the Optionee, in whole or in part, in any subsequent year
included in the Option Period but not later than the expiration of the Option
Period.
(e) No less than 50 shares of Common Stock may be purchased upon any one
exercise of the option granted hereby unless the number of shares purchased at
such time is the total number of shares in respect of which the option granted
hereby is then exercisable.
(f) In no event shall any option granted hereby be exercisable for a
fractional share.
4. Method of Exercising Option and Payment of Option Price.
-------------------------------------------------------
(a) The option granted hereby shall be exercised by the Optionee delivering
to the Secretary of the Company, from time to time, on any business day (the
"Exercise Date"), written notice specifying the number of shares the Optionee
then desires to purchase (the "Notice"), and either (i) cash, certified check,
<PAGE>
bank draft or postal or express money order to the order of the Company for an
amount in United States dollars equal to the option price for the number of
shares specified in the Notice (the "Total Option Price"), such payment to be
delivered with the Notice, (ii) shares of Common Stock of the Company with a
value (determined in accordance with paragraph 4(c)) equal to or less than the
Total Option Price plus cash, certified check, bank draft or postal or express
money order to the order of the Company for an amount in United States dollars
equal to the amount, if any, by which the Total Option Price exceeds the value
of such shares of the Company's stock (determined in accordance with paragraph
4(c)), or (iii) through such other means, acceptable to the Committee in its
sole discretion, as may be provided by an independent third party to facilitate
exercise or payment. Such Company's stock and cash shall be delivered to the
Secretary of the Company not later than the end of the first business day after
the Exercise Date. In the case of payment in shares, such payment shall be made
by delivery of the necessary share certificates, with executed stock powers
attached, to the Secretary of the Company.
(b) Within five business days after the Exercise Date, the Company shall,
subject to the receipt of withholding tax, if any, issue to the Optionee the
number of shares with respect to which such option shall be so exercised, and
shall deliver to the Optionee a certificate or certificates therefor.
(c) For purposes of paragraph 4(a), the value of shares of Common Stock
tendered to exercise an option shall be the last reported sales price of such
shares on the Nasdaq National Market System on the Exercise Date, or, if the
Common Stock is not quoted on the Nasdaq National Market System, the mean
between the closing bid and asked prices of such shares on the Nasdaq System on
the Exercise Date, or, if the foregoing are inapplicable, as otherwise
determined by the Committee.
(d) In the sole discretion of the Committee, the Company may in lieu of
requiring the exercise of an option and the payment of the Total Option Price,
authorize the payment of cash to the Optionee in an amount equal to the market
value of shares of Common Stock subject to an option less the option price in
exchange for the cancellation of the option.
5. Exercisability Upon the Occurrence of Certain Events.
----------------------------------------------------
(a) Notwithstanding any provisions limiting exercisability in whole or in
part, and unless the Committee shall have otherwise determined (within the
limits specified in the last sentence of this paragraph) to revoke or to limit,
in its sole and conclusive discretion, the acceleration provided for herein, the
following shall apply: Stock options ("options") and stock appreciation rights,
if any, ("rights") granted to the Optionee by the Company pursuant to this
Agreement will be exercisable in full for a period of one year (i) following the
Effective Date (as hereinafter defined) or (ii) commencing on the date (the
"Approval Date") of the approval of the Company's Board of Directors of an
agreement providing for a merger, consolidation, sale or disposition of all or
substantially all of the assets of the Company, or other form of extraordinary
<PAGE>
business combination as a result of the consummation of which stockholders of
the Company immediately before Approval Date will own less than a majority of
the outstanding voting stock of the resulting organization. After the expiration
of any such one year period, the options and rights shall remain exercisable
only to the extent, if any, provided in the applicable option or rights
agreement without taking into consideration the effect of this paragraph. The
Committee's discretion to revoke or limit the acceleration contemplated by this
paragraph may be exercised at any time before or within 20 business days after
the Effective Date or the Approval Date referred to in the foregoing clauses (i)
or (ii). In the event the Approval Date and an Effective Date arise from
substantially identical facts and circumstances (as determined by the Committee
in its sole discretion) and unless the Committee shall have determined to limit
the effect of this sentence, such one year period (and the 20 day period
referred to in the immediately preceding sentence) shall commence only once and
upon the first to occur of the Approval Date or the Effective Date.
(b) For purposes of the foregoing paragraph, the following terms have the
meanings indicated:
(i) "Effective Date" shall mean the date on which a "Change of
Control" as hereinafter defined occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs, and if the
Optionee's employment with the Company had terminated prior to the date on
which the Change of Control occurred, and if it is reasonably demonstrated
by the Optionee that such termination of employment either was at the
request of a third party who had taken steps reasonably calculated to
effect the Change of Control or otherwise arose in connection with or in
anticipation of the Change of Control, then, for all purposes of this
Agreement, the term "Effective Date" shall mean the date immediately prior
to the date of such termination of employment.
(ii) A "Change of Control" shall be deemed to have taken place on the
date of the earlier to occur of either of the following events: a) a third
party, including a "group" as defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, becomes the beneficial owner of 25% or more of the
Company's outstanding Common Stock, or b) as the result of, or in
connection with, any cash tender or exchange offer, merge, consolidation or
other business combination, sale or disposition of all or substantially all
of the Company's assets, or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were directors of
the Company immediately before the Transaction shall cease to constitute a
majority of the Board of Directors of the Company or any successor to the
Company or the persons who were stockholder of the Company immediately
before the Transaction shall cease to own at least a majority of the
outstanding voting stock of the Company or any successor to the Company.
<PAGE>
6. Termination.
------------
The option granted hereby shall terminate and be of no force or effect upon
the first occurrence of any one of the following events:
(a) The expiration of ten years from the date of this Agreement;
(b) The expiration of 30 days after termination of the Optionee's
employment with the Company, except in the case of the Optionee's death or
retirement with the consent of the Company; provided, however, that any day on
which the Company has restricted employee securities transactions under
then-applicable securities transactions policies and procedures shall not be
included in determining such 30-day period. During such period, the Optionee
shall have the right to exercise the option hereby granted only to the extent
exercisable on the date of termination.
(c) The expiration of seven months after the date of the Optionee's
retirement with the consent of the Company. During such seven-month period the
Optionee shall have the right to exercise the option hereby granted to the
extent the right to exercise the same has accrued prior to such retirement but
has not been exercised prior to such retirement, subject, in addition, however,
to acceleration by the Committee pursuant to paragraph 3(c); or
(d) The expiration of seven months after the date of death of the Optionee
if said death occurs while (i) the Optionee is in the employ of the Company or
(ii) within the period of time after retirement with the consent of the Company
during which the Optionee was entitled to exercise the option. During such
seven-month period the Optionee's estate, personal representative or beneficiary
shall have the right to exercise the option hereby granted in full.
Retirement at the Optionee's normal retirement date or at an optional
retirement date in accordance with the provisions of a retirement plan of the
Company under which the Optionee is then covered shall constitute a retirement
with the consent of the Company for the purposes of this Agreement. The
Committee shall have absolute and uncontrolled discretion to determine whether
any other termination of Optionee's employment is to be considered as retirement
with the consent of the Company for the purposes of this Agreement and whether
an authorized leave of absence or absence on military or government service or
otherwise shall constitute a termination of employment for the purposes of this
Agreement. Any determination made by the Committee with respect to any matter
referred to in this paragraph 5 shall, subject to the provisions of paragraph 14
hereof, be final and conclusive on all persons affected thereby. Employment by
the Company shall be deemed to include employment of Optionee by, and to
continue during any period in which Optionee is in the employ of, a "Subsidiary"
of the Company as that term is defined in the Plan.
<PAGE>
7. 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 estate, personal representative, or beneficiary to whom this option may
be transferred by will or by the laws of descent and distribution, it shall be
deemed to include such person.
8. Assignability.
--------------
This option is not transferable by the Optionee otherwise than by will or
the laws of descent and distribution and is exercisable during the Optionee's
lifetime only by the Optionee. No assignment or transfer of this option, or of
the rights represented thereby, whether voluntary or involuntary, by 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 attempt to assign or transfer this option
the same shall terminate and be of no force or effect.
9. Rights as a Stockholder.
------------------------
The Optionee shall not be deemed for any purpose to be a stockholder of the
Company with respect to any shares as to which this option shall not have been
exercised and payment and issue made as herein provided.
10. The Company's Rights.
---------------------
The existence of this option shall not affect in any way the right or 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 other stocks with preference ahead of
or convertible into, or otherwise 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.
11. Recapitalization.
-----------------
The shares with respect to which this option is granted are shares of the
Common Stock of the Company as constituted on the date of this Agreement, but
if, and whenever, prior to the delivery by the Company of all of the shares of
Common Stock with respect to which this option is granted, the Company shall
effect a subdivision or consolidation of shares, or other capital readjustment,
or the payment of a stock dividend, or other increase or decrease in the number
of shares of Common Stock outstanding, without receiving compensation therefor
in money, services or property, then (a) in the event of any increase in the
number of such shares outstanding, the number of shares of Common Stock then
remaining subject to option hereunder shall be proportionately increased (except
<PAGE>
that any fraction of a share resulting from any such adjustment shall be
excluded from the operation of this Agreement), and the cash consideration
payable per share shall be proportionately reduced, and (b) in the event of a
reduction in the number of such shares outstanding, the number of shares of
Common Stock then remaining subject to option hereunder shall be proportionately
reduced (except that any fractional share resulting from any such adjustment
shall be excluded from the operation of this Agreement), and the cash
consideration payable per share shall be proportionately increased.
12. Merger and Consolidation.
-------------------------
After a merger of one or more corporations into the Company, or after a
consolidation of the Company and one or more corporations in which the Company
shall be the surviving or resulting corporation, the Optionee shall, at no
additional cost, be entitled upon any exercise of this option, to receive
(subject to any required action by stockholders) in lieu of the number of shares
as to which this option shall then be so exercised, the number and class of
shares of stock or other securities to which the Optionee would have been
entitled pursuant to the terms of the agreement of merger or consolidation, if,
immediately prior to such merger or consolidation, the Optionee had been the
holder of record of a number of shares of Common Stock of the Company equal to
the number of shares as to which such option shall be so exercised; provided,
that anything herein contained to the contrary notwithstanding, upon the
dissolution or liquidation of the Company, or upon any merger or consolidation,
in which the Company is not the surviving or resulting corporation, this option
shall terminate and be of no force or effect, except to the extent that such
surviving or resulting corporation may issue a substituted option.
13. Preemption of Applicable Laws or Regulations.
---------------------------------------------
Anything in this Agreement to the contrary notwithstanding, if, at any time
specified herein for the issue of shares to the Optionee, any law, regulation or
requirements of any governmental authority having jurisdiction in the premises
shall require either the Company or the Optionee to take any action in
connection with the shares then to be issued, the issue of such shares shall be
deferred until such action shall have been taken.
14. Resolution of Disputes.
-----------------------
Subject to the provisions of paragraph 14 hereof, any dispute or
disagreement which shall arise under, or as a result of, or pursuant to, this
Agreement shall be determined by the Committee in its absolute and uncontrolled
discretion, and any such determination or any other determination by the
Committee under or pursuant to this Agreement and any interpretation by the
Committee of the terms of this Agreement, shall be final, binding and conclusive
on all persons affected thereby.
<PAGE>
15. Amendments.
-----------
The Committee shall have the right, in its absolute and uncontrolled
discretion, to alter or amend this Agreement, from time to time in any manner
for the purpose of promoting the objectives of the Plan but only if all
agreements granting options to purchase shares of the Company's Common Stock
pursuant to the Plan which is in effect and not wholly exercised at the time of
such alteration or amendment shall also be similarly altered or amended with
substantially the same effect, and any alteration or amendment of this Agreement
by the Committee shall, upon adoption thereof by the Committee, become and be
binding and conclusive on all persons affected thereby without requirement for
consent or other action with respect thereto by any such person. The Company
shall give written notice to the Optionee of any such alteration or amendment of
this Agreement by the Committee as promptly as practical after the adoption
thereof. The foregoing shall not restrict the ability of the Optionee and the
Company by mutual consent to alter or amend this Agreement in any manner which
is consistent with the Plan and approved by the Committee.
16. Notice.
-------
Any notice which either party hereto may be required or permitted to give
to the other shall be in writing, and may be delivered personally or by mail,
postage prepaid, addressed as follows: to the Secretary of the Company, or to
the Company (attention of the Secretary), at 100 East Pratt Street, Baltimore,
Maryland 21202, or at such other address as the Company, by notice to the
Optionee, may designate in writing from time to time to the Optionee at the
Optionee's address as shown on the records of the Company, or at such other
address as the Optionee, by notice to the Secretary of the Company, may
designate in writing from time to time.
17. Construction.
-------------
This Agreement has been entered into in accordance with the terms of the
Plan and wherever a conflict may arise between the terms of this Agreement and
the terms of the Plan, the terms of the Plan shall control.
18. Disqualifying Dispositions.
---------------------------
(a) The Optionee shall notify the Company, within ten (10) days of the
occurrence thereof, of the disposition of any stock acquired under this
incentive stock option agreement within less than two years of the date of this
Agreement or one year of the exercise of the option to purchase such shares.
<PAGE>
(b) In connection with any such disqualifying dispositions the Company
shall have the option to (i) require the Optionee to remit to the Company an
amount sufficient to satisfy all federal, state, and other withholding taxes
thereby incurred; or (ii) withhold all federal, state, and other withholding
taxes thereby incurred from compensation otherwise due to the Optionee.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officer, and the Optionee has hereunto set his or her
hand and seal all as of the day and year first above written.
THE COMPANY:
T. Rowe Price Associates, Inc.
By______________________________
THE OPTIONEE:
___________________________(L.S.)
NON-QUALIFIED STOCK OPTION AGREEMENT
pursuant to the
T. ROWE PRICE ASSOCIATES, INC.
1996 STOCK INCENTIVE PLAN
_
AGREEMENT, dated as of this __th day of __________, _____, between T. ROWE
PRICE ASSOCIATES, INC. (the "Company"), and 1~ (the "Optionee").
WHEREAS, the Optionee is now in the employ of the Company or a Subsidiary
(as hereinafter defined) in a key capacity and the Company desires to have the
Optionee remain in such employ and to afford the Optionee the opportunity to
acquire, or enlarge, the Optionee's stock ownership in the Company so that the
Optionee may have a direct proprietary interest in the Company's success; and
WHEREAS, the Company has and its stockholders have approved the T. Rowe
Price Associates, Inc. 1996 Stock Incentive Plan (the "Plan"), pursuant to which
the Company may, from time to time, enter into stock option agreements with
certain of its eligible employees as therein defined;
NOW THEREFORE, in consideration of the premises and of the mutual covenants
and agreements hereinafter set forth, the parties hereto hereby mutually
covenant and agree as follows:
1. Employee's Agreement.
The Optionee agrees to remain in the employ of the Company and to render it
the Optionee's exclusive services at such compensation as shall be determined,
from time to time, by the Company for a period of one year from the date hereof,
but this Agreement shall not be deemed to limit or restrict the right of the
Company to terminate Optionee's employment at any time, for any reason, for or
without cause; provided, that the Company's sole remedy hereunder for a breach
of the employee's agreement shall be the termination of the option granted
hereunder in accordance with Section 6 hereof.
2. Grant of Option.
Subject to the terms and conditions set forth herein, the Company hereby
grants to the Optionee during the period commencing one year after the date of
this Agreement and ending ten years from the date hereof (the "Option Period"),
the option to purchase from the Company at a price of $______ per share up to
but not exceeding in the aggregate 2~ shares of the Company's Common Stock.
3. Exercise of Option.
(a) The aggregate number of shares of stock shall be exercisable as
follows:
The first installment of 3~ shares shall be exercisable, in whole or
in part, commencing ----------, -----;
The second installment of 4~ shares shall be exercisable, in whole or
in part, commencing ----------, -----;
The third installment of 5~ shares shall be exercisable, in whole or
in part, commencing ------------, ------;
The fourth installment of 6~ shares shall be exercisable, in whole or
in part, commencing ____________, ______; and
The final installment of 7~ shares shall be exercisable, in whole or
in part, commencing --------------, -----.
(b) The Executive Compensation Committee of the Board of Directors of the
Company (the "Committee") may in its discretion place limitations on the extent
to which shares of Common Stock of the Company may be tendered by the Optionee
as payment upon exercise of an option pursuant to paragraph 4(a) hereof.
(c) In the case of an option not immediately exercisable in full, the
Committee may in its discretion accelerate the time at which such option may be
exercised.
(d) To the extent not exercised, installments shall accumulate and be
exercisable by the Optionee, in whole or in part, in any subsequent year
included in the Option Period but not later than the expiration of the Option
Period.
(e) No less than 50 shares of Common Stock may be purchased upon any one
exercise of the option granted hereby unless the number of shares purchased at
such time is the total number of shares in respect of which the option granted
hereby is then exercisable.
(f) In no event shall any option granted hereby be exercisable for a
fractional share.
<PAGE>
4. Method of Exercising Option and Payment of Option Price.
(a) The option granted hereby shall be exercised by the Optionee delivering
to the Secretary of the Company, from time to time, on any business day (the
"Exercise Date"), written notice specifying the number of shares the Optionee
then desires to purchase (the "Notice"), and either (i) cash, certified check,
bank draft or postal or express money order to the order of the Company for an
amount in United States dollars equal to the option price for the number of
shares specified in the Notice (the "Total Option Price"), such payment to be
delivered with the Notice, (ii) shares of Common Stock of the Company with a
value (determined in accordance with paragraph 4(c)) equal to or less than the
Total Option Price plus cash, certified check, bank draft or postal or express
money order to the order of the Company for an amount in United States dollars
equal to the amount, if any, by which the Total Option Price exceeds the value
of such shares of the Company's stock (determined in accordance with paragraph
4(c)), or (iii) through such other means, acceptable to the Committee in its
sole discretion, as may be provided by an independent third party to facilitate
exercise or payment. Such Company's stock and cash shall be delivered to the
Secretary of the Company not later than the end of the first business day after
the Exercise Date. In the case of payment in shares, such payment shall be made
by delivery of the necessary share certificates, with executed stock powers
attached, to the Secretary of the Company.
(b) Within five business days after the Exercise Date, the Company shall,
subject to the receipt of withholding tax, if any, issue to the Optionee the
number of shares with respect to which such option shall be so exercised, and
shall deliver to the Optionee a certificate or certificates therefor.
(c) For purposes of paragraph 4(a), the value of shares of Common Stock
tendered to exercise an option shall be the last reported sales price of such
shares on the Nasdaq National Market System on the Exercise Date, or, if the
Common Stock is not quoted on the Nasdaq National Market System, the mean
between the closing bid and asked prices of such shares on the Nasdaq System on
the Exercise Date, or, if the foregoing are inapplicable, as otherwise
determined by the Committee.
(d) In the sole discretion of the Committee, the Company may in lieu of
requiring the exercise of an option and the payment of the Total Option Price,
authorize the payment of cash to the Optionee in an amount equal to the market
value of shares of Common Stock subject to an option less the option price in
exchange for the cancellation of the option.
5. Exercisability Upon the Occurrence of Certain Events.
(a) Notwithstanding any provisions limiting exercisability in whole or in
part, and unless the Committee shall have otherwise determined (within the
limits specified in the last sentence of this paragraph) to revoke or to limit,
<PAGE>
in its sole and conclusive discretion, the acceleration provided for herein, the
following shall apply: Stock options ("options") and stock appreciation rights,
if any, ("rights") granted to the Optionee by the Company pursuant to this
Agreement will be exercisable in full for a period of one year (i) following the
Effective Date (as hereinafter defined) or (ii) commencing on the date (the
"Approval Date") of the approval of the Company's Board of Directors of an
agreement providing for a merger, consolidation, sale or disposition of all or
substantially all of the assets of the Company, or other form of extraordinary
business combination as a result of the consummation of which stockholders of
the Company immediately before Approval Date will own less than a majority of
the outstanding voting stock of the resulting organization. After the expiration
of any such one year period, the options and rights shall remain exercisable
only to the extent, if any, provided in the applicable option or rights
agreement without taking into consideration the effect of this paragraph. The
Committee's discretion to revoke or limit the acceleration contemplated by this
paragraph may be exercised at any time before or within 20 business days after
the Effective Date or the Approval Date referred to in the foregoing clauses (i)
or (ii). In the event the Approval Date and an Effective Date arise from
substantially identical facts and circumstances (as determined by the Committee
in its sole discretion) and unless the Committee shall have determined to limit
the effect of this sentence, such one year period (and the 20 day period
referred to in the immediately preceding sentence) shall commence only once and
upon the first to occur of the Approval Date or the Effective Date.
(b) For purposes of the foregoing paragraph, the following terms have the
meanings indicated:
(i) "Effective Date" shall mean the date on which a "Change of
Control" as hereinafter defined occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs, and if the
Optionee's employment with the Company had terminated prior to the date on
which the Change of Control occurred, and if it is reasonably demonstrated
by the Optionee that such termination of employment either was at the
request of a third party who had taken steps reasonably calculated to
effect the Change of Control or otherwise arose in connection with or in
anticipation of the Change of Control, then, for all purposes of this
Agreement, the term "Effective Date" shall mean the date immediately prior
to the date of such termination of employment.
(ii) A "Change of Control" shall be deemed to have taken place on the
date of the earlier to occur of either of the following events: a) a third
party, including a "group" as defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, becomes the beneficial owner of 25% or more of the
Company's outstanding Common Stock, or b) as the result of, or in
connection with, any cash tender or exchange offer, merge, consolidation or
other business combination, sale or disposition of all or substantially all
of the Company's assets, or contested election, or any combination of the
foregoing transactions (a "Transaction"), the persons who were directors of
<PAGE>
the Company immediately before the Transaction shall cease to constitute a
majority of the Board of Directors of the Company or any successor to the
Company or the persons who were stockholder of the Company immediately
before the Transaction shall cease to own at least a majority of the
outstanding voting stock of the Company or any successor to the Company.
6. Termination.
The option granted hereby shall terminate and be of no force or effect
upon the first occurrence of any one of the following events:
(a) The expiration of ten years from the date of this Agreement;
(b) The expiration of 30 days after termination of the Optionee's
employment with the Company, except in the case of the Optionee's death or
retirement with the consent of the Company; provided, however, that any day on
which the Company has restricted employee securities transactions under
then-applicable securities transactions policies and procedures shall not be
included in determining such 30-day period. During such period, the Optionee
shall have the right to exercise the option hereby granted only to the extent
exercisable on the date of termination.
(c) The expiration of seven months after the date of the Optionee's
retirement with the consent of the Company. During such seven-month period the
Optionee shall have the right to exercise the option hereby granted to the
extent the right to exercise the same has accrued prior to such retirement but
has not been exercised prior to such retirement, subject, in addition, however,
to acceleration by the Committee pursuant to paragraph 3(c); or
(d) The expiration of seven months after the date of death of the Optionee
if said death occurs while (i) the Optionee is in the employ of the Company or
(ii) within the period of time after retirement with the consent of the Company
during which the Optionee was entitled to exercise the option. During such
seven-month period the Optionee's estate, personal representative or beneficiary
shall have the right to exercise the option hereby granted in full.
Retirement at the Optionee's normal retirement date or at an optional
retirement date in accordance with the provisions of a retirement plan of the
Company under which the Optionee is then covered shall constitute a retirement
with the consent of the Company for the purposes of this Agreement. The
Committee shall have absolute and uncontrolled discretion to determine whether
any other termination of Optionee's employment is to be considered as retirement
with the consent of the Company for the purposes of this Agreement and whether
an authorized leave of absence or absence on military or government service or
otherwise shall constitute a termination of employment for the purposes of this
Agreement. Any determination made by the Committee with respect to any matter
<PAGE>
referred to in this paragraph 5 shall, subject to the provisions of paragraph 14
hereof, be final and conclusive on all persons affected thereby. Employment by
the Company shall be deemed to include employment of Optionee by, and to
continue during any period in which Optionee is in the employ of, a "Subsidiary"
of the Company as that term is defined in the Plan.
7. 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 estate, personal representative, or beneficiary to whom this option may
be transferred by will or by the laws of descent and distribution, it shall be
deemed to include such person.
8. Assignability.
This option is not transferable by the Optionee otherwise than by will or
the laws of descent and distribution and is exercisable during the Optionee's
lifetime only by the Optionee. No assignment or transfer of this option, or of
the rights represented thereby, whether voluntary or involuntary, by 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 attempt to assign or transfer this option
the same shall terminate and be of no force or effect.
9. Rights as a Stockholder.
The Optionee shall not be deemed for any purpose to be a stockholder of the
Company with respect to any shares as to which this option shall not have been
exercised and payment and issue made as herein provided.
10. The Company's Rights.
The existence of this option shall not affect in any way the right or 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 other stocks with preference ahead of
or convertible into, or otherwise 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.
11. Recapitalization.
The shares with respect to which this option is granted are shares of the
Common Stock of the Company as constituted on the date of this Agreement, but
if, and whenever, prior to the delivery by the Company of all of the shares of
Common Stock with respect to which this option is granted, the Company shall
<PAGE>
effect a subdivision or consolidation of shares, or other capital readjustment,
or the payment of a stock dividend, or other increase or decrease in the number
of shares of Common Stock outstanding, without receiving compensation therefor
in money, services or property, then (a) in the event of any increase in the
number of such shares outstanding, the number of shares of Common Stock then
remaining subject to option hereunder shall be proportionately increased (except
that any fraction of a share resulting from any such adjustment shall be
excluded from the operation of this Agreement), and the cash consideration
payable per share shall be proportionately reduced, and (b) in the event of a
reduction in the number of such shares outstanding, the number of shares of
Common Stock then remaining subject to option hereunder shall be proportionately
reduced (except that any fractional share resulting from any such adjustment
shall be excluded from the operation of this Agreement), and the cash
consideration payable per share shall be proportionately increased.
12. Merger and Consolidation.
After a merger of one or more corporations into the Company, or after a
consolidation of the Company and one or more corporations in which the Company
shall be the surviving or resulting corporation, the Optionee shall, at no
additional cost, be entitled upon any exercise of this option, to receive
(subject to any required action by stockholders) in lieu of the number of shares
as to which this option shall then be so exercised, the number and class of
shares of stock or other securities to which the Optionee would have been
entitled pursuant to the terms of the agreement of merger or consolidation, if,
immediately prior to such merger or consolidation, the Optionee had been the
holder of record of a number of shares of Common Stock of the Company equal to
the number of shares as to which such option shall be so exercised; provided,
that anything herein contained to the contrary notwithstanding, upon the
dissolution or liquidation of the Company, or upon any merger or consolidation,
in which the Company is not the surviving or resulting corporation, this option
shall terminate and be of no force or effect, except to the extent that such
surviving or resulting corporation may issue a substituted option.
13. Preemption of Applicable Laws or Regulations.
Anything in this Agreement to the contrary notwithstanding, if, at any time
specified herein for the issue of shares to the Optionee, any law, regulation or
requirements of any governmental authority having jurisdiction in the premises
shall require either the Company or the Optionee to take any action in
connection with the shares then to be issued, the issue of such shares shall be
deferred until such action shall have been taken.
14. Resolution of Disputes.
Subject to the provisions of paragraph 14 hereof, any dispute or
disagreement which shall arise under, or as a result of, or pursuant to, this
Agreement shall be determined by the Committee in its absolute and uncontrolled
discretion, and any such determination or any other determination by the
<PAGE>
Committee under or pursuant to this Agreement and any interpretation by the
Committee of the terms of this Agreement, shall be final, binding and conclusive
on all persons affected thereby.
15. Amendments.
The Committee shall have the right, in its absolute and uncontrolled
discretion, to alter or amend this Agreement, from time to time in any manner
for the purpose of promoting the objectives of the Plan but only if all
agreements granting options to purchase shares of the Company's Common Stock
pursuant to the Plan which is in effect and not wholly exercised at the time of
such alteration or amendment shall also be similarly altered or amended with
substantially the same effect, and any alteration or amendment of this Agreement
by the Committee shall, upon adoption thereof by the Committee, become and be
binding and conclusive on all persons affected thereby without requirement for
consent or other action with respect thereto by any such person. The Company
shall give written notice to the Optionee of any such alteration or amendment of
this Agreement by the Committee as promptly as practical after the adoption
thereof. The foregoing shall not restrict the ability of the Optionee and the
Company by mutual consent to alter or amend this Agreement in any manner which
is consistent with the Plan and approved by the Committee.
16. Notice.
Any notice which either party hereto may be required or permitted to give
to the other shall be in writing, and may be delivered personally or by mail,
postage prepaid, addressed as follows: to the Secretary of the Company, or to
the Company (attention of the Secretary), at 100 East Pratt Street, Baltimore,
Maryland 21202, or at such other address as the Company, by notice to the
Optionee, may designate in writing from time to time to the Optionee at the
Optionee's address as shown on the records of the Company, or at such other
address as the Optionee, by notice to the Secretary of the Company, may
designate in writing from time to time.
17. Construction.
This Agreement has been entered into in accordance with the terms of the
Plan and wherever a conflict may arise between the terms of this Agreement and
the terms of the Plan, the terms of the Plan shall control.
18. The option created by this Agreement shall not be treated as an
incentive stock option.
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its duly authorized officer, and the Optionee has hereunto set his or her hand
and seal all as of the day and year first above written.
THE COMPANY:
T. Rowe Price Associates, Inc.
By________________________________
THE OPTIONEE:
____________________________(L.S.)
PIPER & MARBURY
L.L.P.
CHARLES CENTER SOUTH
36 SOUTH CHARLES STREET
BALTIMORE, MARYLAND 21201-3018
410-539-2530
FAX: 410-539-0489
January 24, 1997
T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, Maryland 21202
Registration Statement on Form S-8
Dear Sirs:
We have acted as counsel for T. Rowe Price Associates, Inc., a Maryland
corporation (the "Company"), in connection with a Registration Statement on Form
S-8 which was filed by the Company under the Securities Act of 1933, as amended,
(the "Registration Statement"), and which registers 8,000,000 shares of the
Common Stock of the Company (the "Shares") to be issued pursuant to the
Company's 1996 Stock Incentive Plan (the "Incentive Plan"). In that capacity, we
have reviewed the charter and by-laws of the Company, the Registration
Statement, the corporate action taken by the Company that provides for the
issuance or delivery of the Shares to be issued or delivered under the Incentive
Plan and such other materials and matters as we have deemed necessary for the
issuance of this opinion.
Based upon the foregoing, we are of the opinion that the Shares have been
duly and validly authorized and upon issuance and delivery thereof as
contemplated in the Registration Statement, will be, under the general
corporation law of the State of Maryland, legally issued, fully paid, and
non-assessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement and to the reference to our firm and to our opinion in the
Registration Statement and the prospectus which is a part thereof.
Very truly yours,
/s/ Piper & Marbury L.L.P.
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 25, 1996, appearing on page 22
of the T. Rowe Price Associates, Inc. Annual Report on Form 10-K for the year
ended December 31, 1995.
/s/ PRICE WATERHOUSE LLP
Baltimore, Maryland
January 24, 1997
T. ROWE PRICE ASSOCIATES, INC.
Power of Attorney
KNOW ALL MEN BY THESE PRESENTS, that the undersigned directors and officers
of T. Rowe Price Associates, Inc., a Maryland corporation, constitute and
appoint George J. Collins, George A. Roche, and Alvin M. Younger, Jr. or any one
of them, the true and lawful agents and attorneys-in-fact of the undersigned
with full power and authority in said agents and attorneys-in-fact, and in any
one or more of them, to sign for the undersigned in their respective names as
directors and officers of T. Rowe Price Associates, Inc., a Registration
Statement on Form S-8 (or other appropriate form) to be filed with the
Securities and Exchange Commission under the Securities Act of 1933 and any
amendment or supplement to such registration statement relating to the sale of
common stock under the T. Rowe Price Associates, Inc. 1996 Stock Incentive Plan.
We hereby confirm all acts taken by such agents and attorneys-in-fact, or any
one or more of them, as herein authorized.
DATED: January 24, 1997
/s/ George J. Collins
---------------------
George J. Collins,
Principal Executive Officer and Director
/s/ George A. Roche
-------------------
George A. Roche,
Principal Financial Officer and Director
/s/ Alvin M. Younger, Jr.
-------------------------
Alvin M. Younger, Jr.
Principal Accounting Officer
George J. Collins, Henry H. Hopkins, James A.C. Kennedy, John H. Laporte,
William T. Reynolds, James S. Riepe, George A. Roche, and M. David Testa.
/s/ Henry H. Hopkins
--------------------
Henry H. Hopkins
/s/ James A.C. Kennedy
----------------------
James A.C. Kennedy
/s/ John H. Laporte
-------------------
John H. Laporte
/s/ William T. Reynolds
-----------------------
William T. Reynolds
/s/ James S. Riepe
------------------
James S. Riepe
/s/ M. David Testa
------------------
M. David Testa
