As filed with the Securities and Exchange Commission on
August 2, 1994
Registration No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
McKESSON CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 94-3040479
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Post Street
San Francisco, California 94104
(Address of Principal Executive Offices) (Zip Code)
McKesson Corporation 1994 Option Gain Deferral Plan
(Full Title of Plan)
Nancy A. Miller Ivan D. Meyerson
Vice President and Vice President and
Corporate Secretary General Counsel
One Post Street One Post Street
San Francisco, CA 94104 San Francisco, CA 94104
(Name and address of agents for service)
(415) 983-8300
(Telephone number, including area code, of agents for service)
CALCULATION OF REGISTRATION FEE
Proposed
Proposed Maximum
Amount Maximum Aggregate Amount of
Title of Securities to be Offering Offering Registra-
to be Registered Registered Price Price Fee
- ----------------------------------------------------------------------
General Obligations $25,000,000 $25,000,000 $25,000,000 $8,620.69
of McKesson
Corporation under the
McKesson Corporation
1994 Option Gain
Deferral Plan in the
principal amount of
$25,000,000
* This registration statement covers the principal amount of
$25,000,000 and the registration fee is based upon such
principal amount.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 1. Plan Information.*
Item 2. Registrant Information and Employee Plan Annual
Information.*
Item 3. Incorporation of Certain Documents by Reference.
The following documents filed by the Company with the
Securities and Exchange Commission are incorporated herein by
reference:
(a) The Company's Annual Report on Form 10-K for the fiscal
year ended March 31, 1994.
(b) The Company's Definitive Proxy Statement dated June 14,
1994, filed with the Commission pursuant to Section 14
of the Exchange Act in connection with the annual
meeting of stockholders originally scheduled to be held
on July 27, 1994 (including the financial Appendix
thereto).
(c) The Company's Schedule 14D-9 dated July 15, 1994.
(d) The Company's press release dated July 11, 1994.
(e) The Company's Current Report on Form 8-K dated July 29,
1994.
In addition, all documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 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 the registration
statement and to be a part hereof from the date of filing of such
documents.
Item 4. Description of Securities.
The McKesson Corporation Option Gain Deferral Plan (the
"Plan") is an unfunded deferred compensation plan. The
securities to be issued under the Plan constitute general
obligations of the Registrant and will be offered to eligible
Plan participants who may elect to defer receipt of any or all of
the cash portion of their exercisable option gains described
herein. An aggregate principal amount of $25,000,000 is being
registered under the Plan.
- --------------------
* Information required by Part I to be contained in the
Section 10(a) prospectus is omitted from the Registration
Statement in accordance with Rule 428 under the Securities
Act of 1933 and the Note to Part I of Form S-8.
Participation in the Plan is limited to the non-employee
members of the Registrant's Board of Directors and to key
employees of the Registrant who received stock options and who,
in connection with the restructuring of the Company that will
result in the sale of the PCS business to Eli Lilly and Company
(the "Transaction"), elect to defer receipt of any or all of the
cash portion of their exercisable option gains (the "Option
Gain") otherwise payable in the Transaction. The minimum amount
of the Option Gain that may be deferred by a participating
employee or non-employee director under the Plan is $5,000 and
the maximum amount is 100% of the Option Gain. Notwithstanding
these limits, deferrals may be reduced by the Company to leave
sufficient remaining compensation for legally required taxes and
other authorized deductions. All obligations under the Plan will
be assigned to and assumed by the Registrant's subsidiary, SP
Ventures, Inc. (to be renamed McKesson Corporation) ("New
McKesson") in connection with the Transaction.
The Option Gain deferred by a participant under the Plan is
credited to a separate bookkeeping account for such participant.
No actual funds or Registrant stock are set aside for the purpose
of funding the Registrant's obligation to pay this deferred
amount. Interest will be credited to each account for each year
of a participant's participation in the Plan at a rate equal to
the Moody's Corporate Bond Yield Average for December of the
preceding year. Each account balance will be compounded monthly
at the twelfth root of the annual declared rate of interest
provided for under the Plan. The interest rate to be credited
for the remainder of calendar year 1994 is 7.5%.
Deferrals are generally subject to a minimum deferral period
of two years following the date of deferral. However, upon
termination of employment for any reason other than retirement or
death, a participant's full account balance will be paid to the
participant regardless of any prior deferral election. Upon
retirement under the McKesson Corporation Retirement Plan or in
the event of a participant's death, Plan benefits will be
distributed in the form and at the time designated by the
participant's prior valid deferral election selected from the
payment options offered by the Plan. In the case of undue
hardship for a participant, the Plan Administrator, in its sole
discretion, may direct payment to a participant of all or any
portion of any amounts deferred. The Plan does not provide for
distribution of deferred funds to participants upon a change in
control.
Amounts paid under the Plan will be paid from the general
funds of the Registrant or New McKesson, and each participant and
his or her beneficiaries have the status of unsecured general
creditors of the Registrant and New McKesson with no special or
prior right to any assets of the Registrant or New McKesson for
payment of any obligations under the Plan. Except as otherwise
provided by law, Plan benefits are not assignable and may not be
used as security for loans or otherwise alienated. As of
June 30, 1994, the aggregate amount of indebtedness of the
Registrant senior to the rights of the participants in the Plan
was approximately $302 million. Under the Plan, there is no
limitation on the Registrant's (or New McKesson's) right to issue
additional senior debt or other securities. No events of default
exist under the Plan nor is any absence of default evidence
required. No trust of any kind is created by the Plan for the
benefit of any participant or participant's beneficiary.
The Plan may be terminated or amended at any time by an
action of the majority of the Registrant's (or New McKesson's)
Board of Directors. Any amendment will be prospective, so that
benefits attributable to prior compensation deferrals will not be
affected by such amendment. If the Plan is terminated,
previously deferred compensation and credited interest will be
paid under the terms of the Plan as soon as is practicable after
termination.
Item 5. Interests of Named Experts and Counsel.
Not Applicable
Item 6. Indemnification of Officers and Directors
Paragraph 7 of Article SIX of the Company's Restated
Certificate of Incorporation provides as follows:
"7. The Corporation shall indemnify (a) its directors to
the fullest extent permitted by the laws of the State of
Delaware now or hereafter in force, including the advance of
expenses under the procedures provided by such laws, (b) all
of its officers to the same extent as it shall indemnify its
directors, and (c) its officers who are not directors to
such further extent as shall be authorized by the Board of
Directors and be consistent with law. Subject only to any
limitations prescribed by the laws of the State of Delaware
now or hereafter in force, the foregoing shall not limit the
authority of the Corporation to indemnify the directors,
officers and other employees and agents of this Corporation
consistent with law and shall not be deemed to be exclusive
of any rights to which those indemnified may be entitled as
a matter of law or under any resolution, By-Law provision,
or agreement."
Under Section 145 of the General Corporation Law of the
State of Delaware, the state in which the Registrant is
incorporated, a Delaware corporation has the power, under
specified circumstances, to indemnify its directors, officers,
employees and agents in connection with actions, suits or
proceedings brought against them by a third party, or by or in
the right of the corporation, by reason of the fact that they
were or are such directors, officers, employees or agents. In
general, Section 145 provides that a corporation has the power to
indemnify directors,, officers, employees or agents where the
individual acted in good faith and in a manner such individual
reasonably believed to be in, or not opposed to, the best
interests of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe such
individual's conduct was unlawful. In circumstances where the
individual shall have been adjudged to be liable for negligence
or misconduct in the performance of such individual's duty to the
corporation, indemnification will be allowed only to the extent
that the court considering the action decides, in view of the
circumstances, the individual is entitled to indemnity.
The directors and officers of the Registrant and its
subsidiaries are covered by policies of insurance under which
they are insured, within limits and subject to the limitations of
the policies, against certain expenses in connection with the
defense of actions, suits or proceedings, and certain liabilities
which might be imposed as a result of such actions, suits or
proceedings, in which they are parties by reason of being or
having been directors or officers; the Registrant is similarly
insured, with respect to certain payments it might be required to
make its directors or officers under the applicable statutes and
its charter provisions. In addition, pursuant to authority
contained in Article VIII of the Registrant's By-Laws ("Article
VIII"), the Registrant has entered into indemnification
agreements with its directors and officers. Those agreements, in
effect, give each director and officer a contractual right to
assert against the Registrant the indemnification rights provided
to them in Article VIII upon the occurrence of an Indemnifiable
Event (as defined in the agreements). The agreements further
provide for the funding of a trust by the Registrant in certain
specified circumstances in an amount sufficient to satisfy the
indemnitee's expenses and liabilities relating to an
Indemnifiable Event.
Item 7. Exemption from Registration Claimed.
Not Applicable
Item 8. Exhibits.
The exhibits listed below are filed as part of this
Registration Statement:
Exhibit
No. Description
- -----------------------------------------------------------------
4 McKesson Corporation 1994 Option Gain Deferral Plan
Summary
5 Opinion of Ivan D. Meyerson, Vice President and General
Counsel of the Registrant, as to the legality of the
securities being registered
23 Independent Auditors' Consent
23.1 Consent of Ivan D. Meyerson, Vice President and General
Counsel of the Registrant, is included in Exhibit 5 to
this Registration Statement
24 Powers of Attorney pursuant to which certain officers
and directors of the registrant signed this
Registration Statement
99.1 Memorandum to Executives and Non-Employee Directors
Eligible to Participate in the McKesson Corporation
1994 Option Gain Deferral Plan dated August 2, 1994
99.2 Form of Participant's Election to Defer Cash Portion of
Option Gain under the McKesson Corporation 1994 Option
Gain Deferral Plan
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;
(ii) To reflect in the prospectus any facts or
events effective arising after the date of the registration
statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represents a fundamental
change in the information set forth in the registration
statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such
information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the registration statement is on Form
S-3 or Form S-8 and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13
or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in 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.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (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.
(c) The undersigned registrant hereby undertakes to deliver
or cause to be delivered with the prospectus, to each person to
whom the prospectus is sent or given, the latest annual report to
security holders that is incorporated by reference in the
prospectus and furnished pursuant to and meeting the requirements
of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be
presented by Article 3 of Regulation S-X is not set forth in the
prospectus, to deliver, or cause to be delivered to each person
to whom the prospectus is sent or given, the latest quarterly
report that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
(d) Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
the provisions described in Item 6, 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
proceedings) 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.
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 San Francisco, State of California, on the 2nd day of
August 1994.
McKESSON CORPORATION
(Registrant)
By:/s/Nancy A. Miller
Vice President and Secretary
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the date indicated.
Signature Title Date
- --------- ----- -----
*
- -----------------
Alan J. Seelenfreund Chairman of the Board August 2, 1994
and Chief Executive Officer
(Principal Executive Officer)
*
- -----------------
David E. McDowell President, Chief August 2, 1994
Operating Officer
and Director
*
- -----------------
Garret A. Scholz Vice President August 2, 1994
Finance (Principal
Financial Officer)
*
- -----------------
Richard H. Hawkins Vice President and August 2, 1994
Controller (Principal
(Accounting Officer)
*
- -----------------
Tully M. Friedman Director August 2, 1994
*
- -----------------
James R. Harvey Director August 2, 1994
*
- -----------------
George M. Keller Director August 2, 1994
*
- -----------------
Leslie L. Luttgens Director August 2, 1994
*
- ----------------
John M. Pietruski Director August 2, 1994
- ----------------
Jane E. Shaw Director August 2, 1994
*
- ----------------
Robert H. Waterman, Jr. Director August 2, 1994
*By: /s/Nancy A. Miller
(Attorney-in-Fact)
EXHIBIT INDEX
Exhibit
No. Description
- ---------------------------------------------------------------
4 McKesson Corporation 1994 Option Gain Deferral Plan
Summary
5 Opinion of Ivan D. Meyerson, Vice President and General
Counsel of the Registrant, as to the legality of the
securities being registered
23 Independent Auditors' Consent
23.1 Consent of Ivan D. Meyerson, Vice President and General
Counsel of the Registrant, is included in Exhibit 5 to
this Registration Statement
24 Powers of Attorney pursuant to which certain officers
and directors of the registrant signed this
Registration Statement
99.1 Memorandum to Executives and Non-Employee Directors
Eligible to Participate in the McKesson Corporation
1994 Option Gain Deferral Plan dated August 2, 1994
99.2 Form of Participant's Election to Defer Cash Portion of
Option Gain under the McKesson Corporation 1994 Option
Gain Deferral Plan
EXHIBIT 4
August 1994
McKESSON CORPORATION
1994 OPTION GAIN DEFERRAL PLAN
SUMMARY
The McKesson Corporation Option Gain Deferral Plan ("OGDP" or the
"Plan") provides eligible executives and non-employee directors
with an opportunity to reduce current taxable income by deferring
for future receipt the cash portion of any gains you will realize
from exercisable stock options in connection with the
restructuring of McKesson Corporation that will result in the
sale of the PCS business to Eli Lilly and Company (the
"Transaction"). This summary outlines the principal Plan
provisions.
PARTICIPATION
You are eligible to defer compensation under the Plan if you:
* are a participant in the McKesson Corporation 1978 Stock
Option Plan, and
* are otherwise entitled to receive a cash payment in
cancellation of your exercisable Company stock options in
connection with the Transaction.
AMOUNT OF DEFERRAL
An eligible executive or director may elect to defer up to the
entire net amount (after payment of applicable taxes, such as
FICA tax) of the gain that is paid in cash to holders of
exercisable stock options upon completion of the Transaction.
Any deferral of the cash portion of any option gains realized due
to the Transaction must be at least $5,000.
The gain on exercisable stock options that results from the
Transaction will be provided in a combination of cash and new
exercisable options for new McKesson. The amount of your
exercisable option gain is based on the average closing price of
new McKesson common shares over the ten consecutive trading days
following distribution of these shares to shareholders.
Therefore, the exact amount of the cash portion of the gain from
exercisable stock options eligible for deferral cannot be
determined with certainty until after expiration of that trading
period.
This Plan does not apply to gains realized by the exercise of
options or the sale of option shares before the completion of the
Transaction nor to gains realized from the exercise of new
exercisable options received as a result of the Transaction or to
the sale of these option shares.
As a condition to making the deferral election, you must agree
that, so long as the Transaction has not been abandoned, you will
not exercise stock options to the extent that such exercise would
prevent your deferral of the amount of the cash portion of the
option gains so designated on your OGDP deferral election form
(other than to avoid an option's expiration in accordance with
its terms).
_________________________________________________________________
THIS DOCUMENT CONSTITUTES A PART OF A PROSPECTUS COVERING
SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933.
MINIMUM DEFERRAL PERIOD
The minimum deferral period is basically two years following the
date of deferral. Accordingly, any exercisable stock option gain
deferred during 1994 may generally not be paid to you until
January 1997. However, an earlier payment will be made to you
upon your termination, death, disability, or retirement. In the
event of your death, payment under the Plan may commence
immediately to your beneficiary in accordance with a valid
election.
MODIFICATION OF PRIOR ELECTIONS
Any deferral election may be modified as to its payment form and
timing to the extent such change:
* is made at least one year prior to the previously
scheduled commencement of benefits; and
* does not provide for payment within one year of the
election.
1994 INTEREST RATE: 7.5%
The interest rate to be credited during 1994 on OGDP balances
will be 7.5%. Interest will be credited in future years at the
Moody's Corporate Bond Yield Average - Monthly Average Corporates
applicable in December of each prior year.
DISTRIBUTIONS FROM THE PLAN
Unless an earlier distribution is made (as described above), the
distribution date must be at least two years after the end of the
calendar year in which the election is made. Therefore, an
employee may elect to receive a distribution of his account
balance before his termination of employment, subject to a
minimum 2-year deferral period.
If you terminate employment for any reason other than retirement,
disability, or death, your full account balance will be paid to
you at that time, regardless of any prior deferral election under
OGDP. Upon retirement or disability, or in the event of your
death, Plan benefits will be distributed in the form and at the
time you designated in a prior valid election. The Plan does not
provide for distribution of account balances upon change of
control.
A hardship withdrawal of all or a portion or your account balance
may also be available, subject to the discretion of the Plan
Administrator.
RELATIONSHIP TO OTHER BENEFITS
PSIP, Supplemental PSIP, Retirement Plan, Life insurance, Short-
Term Disability, and Long-Term Disability (LTD) benefits are not
affected by deferrals under OGDP.
TAXES
Appropriate FICA tax on the funds you defer, as well as income
taxes on any amount withheld to pay FICA tax, will be collected
or withheld from your distribution of the option gains following
the completion of the Transaction. McKesson has been advised
that your option gain deferrals and interest credited under the
Plan should not be subject to federal and state income tax until
distributed from the Plan. Federal and state taxes will be
withheld in the future when OGDP distributions are made to you or
your beneficiaries. However, inasmuch as the Company is in no
position to provide individuals with tax advice, eligible
executives and non-employee directors are encouraged to consult
their own tax advisors concerning the tax consequences of
currently receiving option gains in cash or making a deferral
election under OGDP.
The Plan is not funded and is not intended to be qualified under
Section 401(a) of the Internal Revenue Code.
BOOKKEEPING ACCOUNT ONLY
Deferred amounts are recorded by the Company only as a
bookkeeping account, and no actual funds are set aside. In the
event of bankruptcy, your rights are unsecured and may be
subordinated to those of the Company's creditors.
NO ASSIGNMENT OF PLAN BENEFITS
Except as otherwise provided by law, your Plan benefit is not
assignable, either by you or someone else. You may not transfer,
use as security for a loan or otherwise alienate your Plan
benefit.
PLAN AMENDMENT OR TERMINATION
The Plan may be amended or terminated at any time by action of a
majority of the Board of Directors of the Company or, after the
completion of the Transaction, a majority of the Board of
Directors of new McKesson. Any benefits attributable to prior
exercisable option gain deferrals are not affected by such
action. In the event of Plan termination, previously deferred
compensation and credited interest shall be paid under the terms
of the Plan as soon as practicable following the Plan
termination.
NO EMPLOYMENT CONTRACT
Nothing in the Plan or this summary shall grant any rights of
continued employment. Also, this summary does not prohibit
changes in the terms of, or the termination of, employment of an
employee covered by the Plan.
ERISA RIGHTS
The Employee Retirement Income Security Act of 1974 (ERISA)
protects employees' rights under benefit plans. As a plan
subject to ERISA, the Plan must meet certain requirements
relating to reporting and disclosure, retention of records, and
communication of plan benefits.
OTHER INFORMATION
The Plan Administrator maintains the records relating to your
benefits under the Plan. A report summarizing the status of your
account under the Plan is available upon request. Any such
request regarding your Plan benefits or for other information
relating to the operation of the Plan should be directed as
follows:
Manager, Retirement and PSIP Department
McKesson Corporation
One Post Street, 14th Floor
San Francisco, CA 94104
Telephone: (415) 983-8572
This summary outlines the provisions of the Plan. The summary
does not state all the Plan terms and conditions. The Plan
document will govern the actual Plan benefits paid from the Plan.
Copies of the Plan can be requested by contacting the Plan
Administrator.
You may also obtain without charge, upon written or oral request
to the Plan Administrator, the documents incorporated by
reference in Item 3 of Part II of the Company's Registration
Statement on Form S-8.
ELECTION FORM DUE DATE
If you wish to defer all or any of the cash portion of any
exercisable option gain resulting from the Transaction, you can
make your election on the attached form. Any such deferral will
be deducted from the cash portion of the gain otherwise payable
upon completion of the Transaction. Your election form must be
received by August 19, 1994 and will be irrevocable after that
date. The election form may be faxed to the Retirement & PSIP
Department at (415) 983-8549.
EXHIBITS 5 and 23.1
August 2, 1994
Securities and Exchange Commission
File Desk, Room 1004
450 Fifth Street, NW
Washington, DC 20549
Dear Sir or Madam:
McKesson Corporation (the "Company") is filing with the
Securities and Exchange Commission a Registration Statement on
Form S-8 for the purpose of registering under the Securities Act
of 1933, as amended, General Obligations of the Company in the
principal amount of $25,000,000 pursuant to the Company's 1994
Option Gain Deferral Plan.
As General Counsel of the Company, I have examined such documents
and such matters of fact and law as I have deemed necessary for
the purpose of rendering the opinion expressed herein.
Based upon the foregoing, I am of the opinion that the General
Obligations of the Company described above have been duly
authorized and will be validly issued, fully paid and
non-assessable.
Pursuant to the requirements of the Securities Act of 1933, as
amended, I hereby consent to the filing of this opinion as an
exhibit to the registration statement referred to above,
including any amendments thereto.
Very truly yours,
/s/Ivan D. Meyerson
Vice President and General Counsel
EXHIBIT 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of McKesson Corporation on Form S-8 of our report dated
May 16, 1994 (July 10, 1994 as to Note 1), which expresses an
unqualified opinion and includes an explanatory paragraph
relating to the Corporation's change in its method of accounting
for postemployment benefits, postretirement benefits other than
pensions and environmental clean-up costs appearing in the Form
8-K of McKesson Corporation dated July 29, 1994.
/s/DELOITTE & TOUCHE
San Francisco, California
August 2, 1994
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
WHEREAS, McKesson Corporation, a Delaware Corporation
(the "Company"), contemplates filing with the Securities and
Exchange Commission at Washington, D.C., under the provisions of
the Securities Act of 1933, as amended, and the regulations
promulgated thereunder, a Registration Statement on Form S-8 (and
amendments thereto, including post-effective amendments),
registering General Obligations of the Company under the
Company's 1994 Option Gain Deferral Plan.
WHEREAS, the undersigned is an officer or director, or
both, of the Company,
NOW, THEREFORE, the undersigned hereby constitutes and
appoints Nancy A. Miller and Ivan D. Meyerson, and each of them,
his or her true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for such person
and in his or her name, place and stead, in any and all
capacities, to sign the aforementioned Registration Statement and
any and all amendments (including post-effective amendments)
thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing requisite and necessary to
be done in and about the premises, as fully as to all intents and
purposes he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or
their substitutes, may lawfully do and cause to be done by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto set
his or her hand this 27th day of July, 1994.
/s/Alan J. Seelenfreund
/s/David E. McDowell
/s/Garret A. Scholz
/s/Richard H. Hawkins
/s/Tully M. Friedman
/s/James R. Harvey
/s/George M. Keller
/s/Leslie L. Luttgens
/s/John F. Pietruski
Jane E. Shaw
/s/Robert H. Waterman, Jr.
EXHIBIT 99.1
Memorandum To Executives and August 2, 1994
Non-Employee Directors
Eligible to Participate in
Option Gain Deferral Plan
From: Bill Armstrong Corporate Headquarters
(415) 983-9437
Option Gain Deferral Plan --
Action Required by 8/19/94
We are pleased to announce that we have established the McKesson
Corporation 1994 Option Gain Deferral Plan ("OGDP") allowing you
to defer the cash portion of the gain you will realize from your
exercisable stock options in connection with the restructuring of
McKesson Corporation that will result in the sale of the PCS
business to Eli Lilly and Company (the "Transaction").
You will recall from earlier communications that you will receive
some of the gain in the value of your vested options in cash and
the balance in vested stock options for shares of new McKesson.
Under the OGDP, (and subject to the deferral ceiling established
by the Company as explained below) you will be able to defer up
to 100% of the cash portion of your gain. This offer does not
apply to any portion of the gain you will receive in new vested
options which you may subsequently exercise. An election to
defer the entire cash portion of your gain should result in a
deferral into the OGDP of the gain remaining after payment of
applicable taxes, such as FICA. I encourage you to read all the
materials before making your final decision. I also encourage
you to consult with your tax advisor concerning the tax
consequences of currently receiving your option gains in cash or
making a deferral election under OGDP.
The interest rate credited for the remainder of calendar year
1994 on OGDP balances will be 7.5%. Thereafter, the interest
rate will be set each year at the Moody's Corporate Bond Yield
Average for December of the preceding year.
Depending upon participants' response to this deferral
opportunity, the Company may not be able to accept all deferrals
under this plan. If total deferrals are too large, each
participant's deferral will be reduced proportionately.
Unlike other payments of salary and incentive awards, stock
option gains, whether or not deferred, are not eligible for a
Company match under the Profit-Sharing Investment Plan (PSIP) or
the Supplemental PSIP.
A summary of the provisions of the OGDP is enclosed for your
review along with a deferral election form. Should you wish to
make a deferral election, your election form must be received by
August 19, 1994. Deferral elections will be irrevocable after
that date.
If you have any questions regarding the OGDP, please call Rick
Schmitt at (415) 983-9052.
EXHIBIT 99.2
McKESSON CORPORATION
1994 OPTION GAIN DEFERRAL PLAN (OGDP)
PARTICIPANT'S ELECTION TO DEFER CASH PORTION OF OPTION GAIN
in connection with the restructuring of
McKesson Corporation that will result
in the sale of the PCS business to Eli Lilly and
Company (the "Transaction")
I. ELECTION TO PARTICIPATE
Having been designated eligible to participate in the
McKesson Corporation 1994 Option Gain Deferral Plan, I hereby
elect to defer compensation under the Plan in the amount
stated in Section II.
II. AMOUNT OF COMPENSATION DEFERRED (Minimum deferral is $5,000)
I elect to defer receipt of the following amount of the cash
portion of any option gain realized upon completion of the
Transaction.
[] percent (%) of cash gain. [] Cash gain in the
amount of $ .
III. METHOD OF PAYMENT
A. Form of Benefit
I elect distribution of my balance attributable to the
cash portion of the option gain realized upon completion
of the Transaction in the following form:
[] Single Sum. [] Payment in (2 to 10)
approximately equal annual installments.
B. Time Payments Begin
I elect to have payment of my balance attributable to the
cash portion of the option gain realized upon completion
of the Transaction at the following time:
[] As soon as practicable following termination of my
employment due to retirement if paid in a single
sum.
[] In January of the year (and each
year thereafter if to be paid in installments).
[] In January of the year following
termination of my employment due to retirement (and
each year thereafter if to be paid in
installments).
All Plan funds will be paid in a single sum as soon as
practicable following termination of employment (except in
the case of retirement, disability or death).
IV. DESIGNATION OF BENEFICIARY
My beneficiary is:
__________________ ____________ __________ ______________
Full Name Relationship Birth Date Address
__________________ ____________ __________ ______________
If more than one, the share of any designated beneficiary who
shall not survive me by more than 30 days to receive all
segments, shall go to the survivors share and share alike,
and, if no survivors, to my estate.
Unless otherwise indicated below, the above beneficiary
designation shall apply only to OGDP.
V. PRE-RETIREMENT DEATH BENEFIT ELECTION
A. Form of Benefit for Beneficiary
In the event of my death before benefits have begun, I
elect to have my balance attributable to the cash portion
of the option gain realized upon the completion of the
Transaction paid to my Beneficiary in the following form:
[] Single Sum. [] Payment in (2 to 10)
approximately equal annual
installments.
B. Time Payment Begins
I elect to have payment of my balance attributable to the
cash portion of the option gain realized upon completion
of the Transaction to my Beneficiary begin at the
following time:
[] As soon as practicable following my death (and each
year thereafter if to be paid in installments).
[] In January of the _____ year following my death
(and each year thereafter if to be paid in
installments).
[] When I would otherwise receive distributions under
this Plan.
VI. DISABILITY BENEFIT ELECTION
Notwithstanding my elections in Section III above, in the
event of my disability, I also elect payment of my balance
attributable to the cash portion of the option gain realized
upon the completion of the Transaction in
(1 to 10) approximately equal annual installments, the first
installment to be paid in January of the _______ year
following determination of disability.
VII. SUMMARY OF PRINCIPAL PLAN PROVISIONS
I understand that:
* So long as the Transaction has not been abandoned, I may
not exercise stock options to the extent that such
exercise would prevent my deferral of the amount of the
cash portion of the option gains so designated herein
(other than to avoid an option's expiration in accordance
with its terms).
* If my election does not result in a minimum of $5,000
deferred, it shall be invalid.
* My deferral of any option gain realized upon completion of
the Transaction is not subject to a Company match under
the PSIP or the Supplemental PSIP.
* The remainder of any exercisable option gains not deferred
will be paid in cash and new exercisable options for new
McKesson upon completion of the Transaction.
* Minimum deferral period is 2 years from the date the
election is made, unless distribution is made due to
retirement, death, disability, or termination.
* The Plan does not provide for distribution of account
balances upon change of control.
* This deferral will be established only as a bookkeeping
account. In the event of bankruptcy, my rights are
unsecured and may be subordinated to those of the
Company's creditors.
* If I terminate employment with the Company and new
McKesson prior to the completion of the Transaction, I may
not defer the amount of compensation I elected under
Section II.
* The Company will withhold appropriate taxes on future OGDP
payments as they are made to me and my Beneficiary.
* In the event of my death after payment of benefits has
begun, my Beneficiary will continue to receive benefits at
the times and in the same form as I was receiving.
However, in the event of my death before payment of
benefits has begun, benefits will be paid at the time and
in the form designated in Section V above.
Please refer to the Plan document for further Plan
provisions.
________________ _____________ ________ ______________
Print Name Signature Date Work
Location/Phone
VIII. CONSENT OF SPOUSE
I, _______________________________, acknowledge that I am the
spouse of __________________________________, who is a
participant in the McKesson Corporation 1994 Option Gain
Deferral Plan (OGDP). I understand that my spouse has
designated a beneficiary other than me to receive more than
50% of the value of the account under the Plan, and that I
will not receive at least 50% of the account balance in the
event of my spouse's death. I consent to such designation of
beneficiary by my spouse.
____________________ ___________________________
Date Signature of Spouse
Return Form To: Richard M. Schmitt
Retirement & PSIP
One Post Street, 20th Floor Fax: 415-983-8549
