<PAGE>
As filed with the Securities and Exchange Commission on September 24, 1997
Registration No. 333-_____
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM S-8
Registration Statement
Under
The Securities Act of 1933
---------------------------
ARCO Chemical Company
(Exact name of Registrant as specified in its charter)
Delaware 51-0104393
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3801 West Chester Pike, Newtown Square, Pennsylvania 19073-2387
- ---------------------------------------------------- -------------------
(Address of Principal Executive Offices) (Zip Code)
ARCO CHEMICAL COMPANY
RESTRICTED STOCK PLAN FOR OUTSIDE DIRECTORS
(Full title of the plan)
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
Robert J. Millstone, Esq. Copy to: Kathy Habecker Gaddes, Esq.
Vice President, General Counsel and Secretary ARCO Chemical Company
ARCO Chemical Company 3801 West Chester Pike
3801 West Chester Pike Newtown Square, PA 19073-2387
Newtown Square, PA 19073-2387 (610) 359-3208
(610) 359-3255
(Name, address and telephone number of agent for service)
</TABLE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================================
Title of Amount to be Proposed Maximum Proposed Maximum Amount of
Securities to be Registered* Offering Price Per Aggregate Offering Registration
Registered Share** Price** Fee
<S> <C> <C> <C> <C>
Common Stock, par 75,000 shares $44.9375 $3,370,312.50 $1,021.31
Value $1.00 per share
- ----------------------------------------------------------------------------------------------------
</TABLE>
* This Registration Statement also relates to such indeterminate number of
additional shares as may be offered as a result of stock splits, stock
dividends or similar transactions.
** The proposed maximum offering price per share and the proposed maximum
aggregate offering price are calculated solely for the purpose of
determining the registration fee pursuant to Rule 457 (c) and (h) under the
Securities Act of 1933, as amended. Such prices are based on a price of
$44.9375, which is the average of the high and low sale prices per share of
the Registrant's Common Stock on September 19, 1997, as reported on the New
York Stock Exchange Composite Tape.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
----------------------------------------------------
Item 1. Plan Information
----------------
Information required by this Item is omitted from the Registration
Statement in accordance with the Introductory Note to Part I of Form S-8.
Item 2. Registrant Information and Employee Plan Annual Information
-----------------------------------------------------------
Information required by this Item is omitted from the Registration
Statement in accordance with the Introductory Note to Part I of Form S-8.
<PAGE>
PART II
-------
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
--------------------------------------------------
Item 3. Incorporation of Documents by Reference
---------------------------------------
The following documents filed by ARCO Chemical Company (the "Company")
with the Securities and Exchange Commission (the "Commission") under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
incorporated herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1996.
(b) The Company's Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1997 and June 30, 1997.
(c) The Company's Current Reports on Form 8-K, dated June 27, 1997
and July 21, 1997.
(d) All other reports filed by the Company pursuant to Section 13(a)
or 15(d) of the Exchange Act after December 31, 1996.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act after the date of this Registration Statement
and prior to the filing of a post-effective amendment that indicates that all
securities offered hereby have been sold or that deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of the filing of such documents.
Item 5. Interests of Named Experts and Counsel
--------------------------------------
The legality of the Common Stock offered pursuant to this Registration
Statement will be passed upon for the Company by Robert J. Millstone, Esq., Vice
President, General Counsel and Secretary of the Company. As of August 31, 1997,
Mr. Millstone owned an aggregate of 2,389 shares of Common Stock, held directly
and under a Company benefit plan, and options to purchase another 48,300 shares
of Common Stock. Mr. Millstone disclaims beneficial ownership of an additional
318 shares of Common Stock held in a custodial account for his minor son and a
trust for his adult son.
II-1
<PAGE>
Item 6. Indemnification of Directors and Officers
-----------------------------------------
A. Reference is made to Section 25 of the By-Laws of the Company and
to Section 145 of the General Corporation Law of the State of Delaware as set
forth below.
1. Section 25 of the By-Laws of the Company provides:
(a) Right to Indemnification. Each person who was or is a party or is
------------------------
threatened to be made a party to or is involved or is threatened to be
involved (as a witness or otherwise) in or otherwise requires
representation by counsel in connection with any threatened, pending or
completed action, suit or proceeding, or any inquiry that such person in
good faith believes might lead to the institution of any such action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he or she is or
was a director or officer of the Company or is or was serving at the
request of the Company as a director, officer, employee or agent of another
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, and the basis of
such proceeding is alleged action or inaction in an official capacity or in
any other capacity while serving as such a director, officer, employee or
agent, shall be indemnified and held harmless by the Company to the fullest
extent authorized by the General Corporation Law of Delaware, as the same
exists or may hereafter be amended (but, in the case of any such amendment
with reference to events occurring prior to the effective date thereof,
only to the extent that such amendment permits the Company to provide
broader indemnification rights than such law permitted the Company to
provide prior to such amendment), against all costs, charges, expenses,
liabilities and losses (including attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid in settlement) reasonably
incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a
director or officer (or to serve another entity at the request of the
Company) and shall inure to the benefit of such person's heirs, personal
representatives and estate; provided, however, that, except as provided in
------------------
paragraph (b) hereof, the Company shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated
by such person against the Company only if such proceeding (or part
thereof) was authorized prior to its initiation by a majority of the
disinterested members of the Board of Directors of the Company. The rights
to indemnification conferred in this Section shall include the right to be
paid by the Company any expenses incurred in defending any such proceeding
in advance of its final disposition; provided, however, that, if the
------------------
General Corporation Law of Delaware requires, payment shall be made to or
on behalf of a person only upon delivery to the Company of an undertaking,
by or on behalf of such person, to repay all amounts so advanced if it
shall ultimately be determined that such person is not entitled to be
indemnified under this Section or otherwise. The rights to indemnification
conferred in this Section shall be deemed to be a contract between the
Company and each person who serves in the capacities described above at any
time while this Section is in effect. Any repeal or modification of this
Section shall not in any way diminish any rights to indemnification of such
person or the obligations of the Company arising hereunder.
II-2
<PAGE>
(b) Right of claimant to appeal and to bring suit. If a claim under
---------------------------------------------
paragraph (a) of this Section is not paid in full by the Company within
thirty days after a written claim has been received by the Company, the
claimant may submit a written appeal to the Chairman of the Board. If the
claim is not paid in full by the Company within thirty days after a written
appeal has been received by the Chairman of the Board, the claimant may at
any time thereafter bring suit against the Company to recover the unpaid
amount of the claim. If successful in whole or in part, the claimant shall
be entitled to be paid also the expense of prosecuting or defending such
claim. In any action brought by the claimant to enforce a right to
indemnification hereunder or by the Company to recover payments by the
Company for expenses incurred by a claimant in a proceeding in advance of
its final disposition, the burden of proving that the claimant is not
entitled to be indemnified under this Section or otherwise shall be on the
Company. Neither the failure of the Company (including its Board of
Directors or its independent legal counsel) to have made a determination
prior to the commencement of such action that indemnification of the
claimant is proper in the circumstances because the claimant has met the
applicable standard of conduct set forth in the General Corporation Law of
Delaware, nor an actual determination by the Company (including its Board
of Directors or its independent legal counsel) that the claimant has not
met such applicable standard of conduct, shall create a presumption that
the claimant has not met the applicable standard of conduct or, in the case
of such an action brought by the claimant, be a defense to the action.
(c) Non-exclusivity of rights. The right to indemnification and the
-------------------------
payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in this Section shall not be exclusive of any
other right which any person may have or hereafter acquire under any
statute, the Company's Certificate of Incorporation, any By-Law, any
agreement, a vote of Company stockholders or of disinterested Company
directors or otherwise, both as to action in that person's official
capacity and as to action in any other capacity by holding such office, and
shall continue after the person ceases to serve the Company as a director
or officer or to serve another entity at the request of the Company.
(d) Insurance. The Company may maintain insurance, at its expense, to
---------
protect itself and any director or officer of the Company or another
corporation, partnership, joint venture, trust or other enterprise against
any expense, liability or loss, whether or not the Company would have the
power to indemnify such person against such expense, liability or loss
under the General Corporation Law of Delaware.
(e) Indemnity agreements. The Company may from time to time enter
--------------------
into indemnity agreements with the persons who are members of its Board of
Directors and with such officers or other persons as the Board may
designate, such indemnity agreements to provide in substance that the
Company will indemnify such persons to the fullest extent of the provisions
of this Section 25.
(f) Indemnification of employees and agents of the Company. The
------------------------------------------------------
Company may, under procedures authorized from time to time by the Board of
Directors, grant rights to indemnification, and to be paid by the Company
the expenses incurred in defending any
II-3
<PAGE>
proceeding in advance of its final disposition, to any employee or agent of
the Company to the fullest extent of the provisions of this Section 25.
2. Section 145 of the General Corporation Law of the State of
Delaware provides:
(a) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
person in connection with such action, suit or proceeding if the person
acted in good faith and in a manner the person 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
the person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which
the person 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 reasonable cause to believe that the person's conduct was
unlawful.
(b) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action or suit by or in the right of the corporation to
procure a judgment in its favor by reason of the fact that the person is or
was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and
reasonably incurred by the person in connection with the defense or
settlement of such action or suit if the person acted in good faith and in
a manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of
this section, or in defense of any claim, issue or matter therein, he shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.
II-4
<PAGE>
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the director, officer, employee or agent is proper in the circumstances
because the person has met the applicable standard of conduct set forth in
subsections (a) and (b) of this section. Such determination shall be made
(1) by a majority vote of the directors who are not parties to such action,
suit or proceeding, even though less than a quorum, or (2) if there are no
such directors, or if such directors so direct, by independent legal
counsel in a written opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by other employees and agents may be
so paid upon such terms and conditions, if any, as the board of directors
deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any bylaw, agreement, vote
of stockholders or disinterested directors or otherwise, both as to action
in his official capacity and as to action in another capacity while holding
such office.
(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability
under this section.
(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
this section with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if its separate
existence had continued.
II-5
<PAGE>
(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good
faith and in a manner he reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
(k) The Court of Chancery is hereby vested with exclusive jurisdiction
to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement,
vote of stockholders or disinterested directors, or otherwise. The Court
of Chancery may summarily determine a corporation's obligation to advance
expenses (including attorneys' fees).
B. Under the Administrative Services Agreement between Atlantic
Richfield Company ("ARCO") and the Company, ARCO provides the Company with
insurance coverage under ARCO's Directors' and Officers' Liability Insurance, to
the extent authorized by the By-Laws of the Company and the laws of the State of
Delaware. Such coverage currently has a limit of $205,000,000.
Item 7. Exemption from Registration Claimed
-----------------------------------
None.
Item 8. Exhibits
--------
<TABLE>
<CAPTION>
Number Description Method of Filing
- ------ ----------------------------------------------------- ----------------
<S> <C> <C>
4 ARCO Chemical Company Restricted Stock Plan for Filed herewith
Outside Directors.
5 Opinion of Robert J. Millstone, Esq., Vice President, Filed herewith
General Counsel and Secretary of the Company as to
the legality of the securities being registered.
23.1 Consent of Robert J. Millstone, Esq., Vice President, Included in Exhibit 5
General Counsel and Secretary of the Company.
23.2 Consent of Coopers & Lybrand L.L.P. Filed herewith
</TABLE>
II-6
<PAGE>
24 Power of Attorney authorizing Van Billet to sign the Filed herewith
Registration Statement and all amendments thereto on
behalf of certain directors and officers of the
Company.
Item 9. Undertakings
------------
(a) The Company hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information
set forth in 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
end 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% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective 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-8, 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 Company pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-7
<PAGE>
(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 Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise,
the Company has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or controlling
person of the Company 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 Company will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication of such
issue.
II-8
<PAGE>
SIGNATURES
----------
The Registrant. Pursuant to the requirements of the Securities
--------------
Act of 1933, as amended, 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 Newtown Square, Commonwealth
of Pennsylvania, on this 24th day of September, 1997.
ARCO Chemical Company
By: ALAN R. HIRSIG
--------------------------------------
Alan R. Hirsig
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons, in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Capacity Date
--------- -------- ----
<S> <C> <C>
ANTHONY G. FERNANDES* Chairman of the Board September 24, 1997
- --------------------------- and Director
Anthony G. Fernandes
ALAN R. HIRSIG President, September 24, 1997
- --------------------------- Chief Executive Officer and
Alan R. Hirsig Director
MARVIN O. SCHLANGER* Executive Vice President, September 24, 1997
- --------------------------- Chief Operating Officer and Director
Marvin O. Schlanger
WALTER J. TUSINSKI* Senior Vice President, September 24, 1997
- --------------------------- Chief Financial Officer and Director
Walter J. Tusinski
</TABLE>
II-9
<PAGE>
<TABLE>
<CAPTION>
Signature Capacity Date
--------- -------- ----
<S> <C> <C>
WALTER F. BERAN* Director September 24, 1997
- ------------------------------
Walter F. Beran
MARIE L. KNOWLES* Director September 24, 1997
- ------------------------------
Marie L. Knowles
JAMES A. MIDDLETON* Director September 24, 1997
- ------------------------------
James A. Middleton
STEPHEN R. MUT* Director September 24, 1997
- ------------------------------
Stephen R. Mut
FRANK SAVAGE* Director September 24, 1997
- ------------------------------
Frank Savage
ROBERT H. STEWART, III* Director September 24, 1997
- ------------------------------
Robert H. Stewart, III
VAN BILLET Vice President and Controller September 24, 1997
- ------------------------------ (principal accounting officer)
Van Billet
September 24, 1997
* By: VAN BILLET
- ------------------------------
Van Billet
(Attorney in fact)
</TABLE>
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Number Description Method of Filing
------ -------------------------------------------------- ----------------
<S> <C> <C>
4 ARCO Chemical Company Restricted Stock Plan Filed herewith
for Outside Directors.
5 Opinion of Robert J. Millstone, Esq., Vice Filed herewith
President, General Counsel and Secretary of the
Company as to the legality of the securities being
registered.
23.1 Consent of Robert J. Millstone, Esq., Vice Included in Exhibit 5
President, General Counsel and Secretary of the
Company.
23.2 Consent of Coopers & Lybrand L.L.P. Filed herewith
24 Power of Attorney authorizing Van Billet to sign Filed herewith
the Registration Statement and all amendments
thereto on behalf of certain directors and officers
of the Company.
</TABLE>
<PAGE>
EXHIBIT 4
-----------
<PAGE>
ARCO CHEMICAL COMPANY
RESTRICTED STOCK PLAN FOR OUTSIDE DIRECTORS
The ARCO Chemical Company Restricted Stock Plan for Outside Directors is
set forth as follows:
I. Purposes of the Plan.
The purposes of this Plan are to provide Outside Directors serving on the
Board of Directors of ARCO Chemical Company with a specific incentive to work
for the long-range growth and success of the Company, to align more closely
their interests with those of the Company's stockholders, and to facilitate the
attraction and retention of Outside Directors of superior capability.
II. Definitions.
As used herein, the following terms shall have the following meanings:
2.1 "Annual Compensation" shall mean the sum of the annual retainer payable to
an Outside Director and the annual fee payable to an Outside Director for
service as Chair of any committee in any year, as such amounts are
established by the Board from time to time; provided, however, that Annual
Compensation shall not include meeting fees, which are payable exclusively
in cash to Outside Directors, or any other payment in respect of
compensation for services, such as consulting fees, if any, that may be
payable to an Outside Director from time to time.
2.2 "Board" shall mean the Board of Directors of ARCO Chemical Company.
2.3 "Change of Control" shall mean Change of Control of ARCO Chemical Company
as defined in the ARCO Chemical Company Trust Agreement For Outside
Directors Benefit Plans between ARCO Chemical Company and The State Street
Bank and Trust Company, effective as of July 1, 1994.
2.4 "Committee" shall mean the Outside Directors Compensation Committee of the
Board of Directors of ARCO Chemical Company.
2.5 "Common Stock" shall mean the common stock of ARCO Chemical Company having
a par value of $1.00 per share.
2.6 "Company" shall mean ARCO Chemical Company.
2.7 "Fair Market Value" of a share of Common Stock shall be the mean between
the highest and lowest sales prices, or the closing sales price of a share
of Common Stock, whichever is higher, on the date in question as reported
on the composite tape for issues listed on the New York Stock Exchange.
<PAGE>
2.8 "Mandatory Retirement Age" shall mean the mandatory retirement age for
Outside Directors established by the By-Laws of ARCO Chemical Company.
2.9 "Outside Director" shall mean any member of the Board of Directors of ARCO
Chemical Company that is neither a director, officer or employee of
Atlantic Richfield Company nor an officer or employee of ARCO Chemical
Company nor a director, officer or employee of any of the affiliates of
ARCO Chemical Company or Atlantic Richfield Company.
2.10 "Plan" shall mean this ARCO Chemical Company Restricted Stock Plan for
Outside Directors, including any amendments hereof and rules and
regulations hereunder.
2.11 "Restricted Stock" shall mean shares of Common Stock awarded under this
Plan, which are subject to certain forfeiture and transferability
restrictions as provided in the Plan, in regulations of the Outside
Director Compensation Committee, and in the agreement evidencing the grant
of such Restricted Stock.
III. Participation.
Participation in the Plan is limited to Outside Directors of ARCO Chemical
Company.
IV. Administration of the Plan.
The Plan shall be administered by the Committee. The Committee is
authorized to adopt rules regarding the administration of the Plan, including,
but not limited to, procedures regarding the timing and form of distributions
and elections under the Plan. The Committee may delegate any responsibility
relating to the administration of the Plan to one or more employees of the
Company. The Committee shall act upon all matters relating to the
interpretation and construction of the Plan. Any interpretation, construction
or any other action made or taken pursuant to the provisions of the Plan by the
Committee shall be final, binding and conclusive for all purposes and upon all
persons including the Company, its Outside Directors and their respective
successors in interest.
V. Grant of Restricted Stock.
A. Each Outside Director who (i) is an active participant in the ARCO
Chemical Company Retirement Plan for Outside Directors as of September 30, 1997
and (ii) will not attain Mandatory Retirement Age prior to December 31, 1997,
may elect to convert to Restricted Stock the present value of the accrued
benefit of such Outside Director under the ARCO Chemical Company Retirement Plan
for Outside Directors, effective as of October 1, 1997. Effective October 1,
1997, each Outside Director who elected such conversion shall receive shares of
Restricted Stock equal to the present value of his or her aggregate accrued
benefit under the ARCO Chemical Company Retirement Plan for Outside Directors.
For purposes of determining the number of shares of Restricted Stock to which an
Outside Director is entitled pursuant to such conversion, the average Fair
Market Value of a share of Common Stock during the ten (10) trading days
preceding the date of conversion shall be used.
B. Each Outside Director who (i)is an active participant in the ARCO
Chemical Company Deferral Plan for Outside Directors as of September 30, 1997
and (ii) will not attain Mandatory
<PAGE>
Retirement Age prior to December 31, 1997, may elect to convert to Restricted
Stock the present value of his or her account balance, or any portion thereof,
in the ARCO Chemical Company Deferral Plan for Outside Directors, effective as
of October 1, 1997. Effective October 1, 1997, each Outside Director who
elected such conversion shall receive shares of Restricted Stock equal to the
present value of all or such portion of his or her account balance under the
ARCO Chemical Company Deferral Plan for Outside Directors. For purposes of
determining the number of shares of Restricted Stock to which an Outside
Director is entitled pursuant to such conversion, the average Fair Market Value
of a share of Common Stock during the ten (10) trading days preceding the date
of conversion shall be used.
C. Effective October 1, 1997, pursuant to procedures adopted by the
Committee, each Outside Director shall elect to receive in shares of Restricted
Stock a percentage of the Annual Compensation to be paid to such Outside
Director during the period that such Outside Director serves on the Board;
provided, that in no event shall any Outside Director elect to receive less than
- --------
sixty-five percent (65%) of the Annual Compensation in shares of Restricted
Stock. Subject to Section VII hereof, the award of shares of Restricted Stock
shall be made annually, pursuant to procedures adopted by the Committee based on
the Fair Market Value of a share of Common Stock on the date of the award or the
next preceding trading date of Common Stock; provided, that for purposes of the
--------
award of shares of Restricted Stock made for the period from October 1, 1997 to
December 31, 1997, the average Fair Market Value of a share of Common Stock
during the ten (10) trading days preceding the date of award shall be used.
D. Dividends earned on any award of shares of Restricted Stock under
Subparagraphs A, B and C shall be reinvested in additional shares of Restricted
Stock on the date such dividends are earned; and such additional shares of
Restricted Stock shall be subject to the terms and conditions generally
applicable to Restricted Stock under the Plan.
VI. Terms and Conditions of Restricted Stock.
All Restricted Stock granted or issued under the Plan shall be subject to
the following terms and conditions:
A. Subject to the terms and conditions of this Plan, (i) shares of
Restricted Stock have voting and other rights incident to ownership, including
the right to receive dividends and (ii) dividends accruing on shares of
Restricted Stock shall be reinvested in shares of Restricted Stock.
B. Each share of Restricted Stock shall become nonforfeitable upon the
earlier of (i) retirement at Mandatory Retirement Age, (ii) Change of Control,
(iii) death, (iv) termination of membership on the Board due to a disability, or
(v) termination prior to Mandatory Retirement Age with the consent of a majority
of the remaining members of the Board. Termination prior to Mandatory
Retirement Age with the consent of a majority of the remaining members includes
the failure to be nominated for re-election or the failure to be re-elected to
the Board. If the Outside Director terminates membership on the Board prior to
Mandatory Retirement Age for any reason other than a Change of Control or such
Outside Director's death, termination of membership on the Board due to
disability or termination effected with the consent of the majority of the
remaining members of the Board, the shares of Restricted Stock in the Outside
Director's account shall be forfeited. Notwithstanding anything to the contrary
contained herein, any payments of Restricted Stock to an Outside Director during
the year
<PAGE>
in which such Outside Director leaves the Board, which are not otherwise
forfeited, shall be prorated for such year.
C. For the period during which shares of Restricted Stock are subject to
forfeiture under Subparagraph B hereof or are being held for later distribution
pursuant to a deferral election under Subparagraph D hereof, such shares shall
be nontransferable and nonassignable and may not be sold, assigned, pledged or
otherwise transferred or encumbered by the Outside Director, and any attempt to
do so shall be void.
D. Each Outside Director shall make an election upon entry into the Plan
to govern the distribution of benefits subsequent to Mandatory Retirement Age,
subject to any time, form and other procedures regarding such election as are
prescribed by the Committee. Such election shall be irrevocable. An Outside
Director may request that the Committee consider a change in the election, but
any such change shall be made in the sole discretion of the Committee.
Restricted Stock shall continue to be nontransferable and nonassignable until
distributed.
VII. Common Stock Subject to Plan.
The maximum number of shares of Common Stock that may be issued under the
Plan shall not in the aggregate exceed 75,000 shares of Common Stock, subject to
the adjustments under Paragraph VIII. Common Stock issued under the Plan shall
be Common Stock which is treasury stock; provided that if there is no treasury
--------
stock, the Company may purchase shares of Common Stock on the open market for
issuance under the Plan. Shares of Restricted Stock that have been forfeited
may again become available for the award under this Plan.
VIII. Adjustments.
If the class of shares then subject to the Plan is changed into or
exchanged for a different number or kind of shares or securities, as a result of
any one or more stock splits, reverse stock splits, stock dividends,
recapitalizations, reorganizations, share exchanges or similar events, the
Committee shall make such adjustments that it deems necessary in the number
and/or type of shares or securities for which Restricted Stock has been or may
thereafter be granted under this Plan.
IX. General Provisions.
A. Each member of the Committee may rely upon information reported to him
or her by officers or employees of the Company with responsibility for matters
related to the Plan, and shall not be liable for any act done or omitted, except
in circumstances that would constitute a failure to comply with the standard of
conduct applicable to such member under the General Corporation Law of Delaware.
Each member of the Committee shall have the right to indemnification in
accordance with Section 25 of the Company's By-Laws for any damages sustained by
such member relating to the administration of this Plan.
B. The grant of shares of Restricted Stock under the Plan shall not
constitute an assurance of service on the Board or of nomination to or
continuation of service on the Board, such service being
<PAGE>
subject to election by the stockholders and the will of the Board, or in any way
interfere with or limit the right of stockholders to remove any Outside Director
from the Board.
C. The Plan and the grant of Restricted Stock hereunder shall be subject
to all applicable rules and regulations of governmental and other authorities.
The Company shall require the withholding of any and all taxes that the Company
believes to be required to be withheld by any government or agency thereof.
D. Shares of Common Stock received with respect to an award of Restricted
Stock pursuant to a stock split, stock dividend or other change in the
capitalization of the Company will be held subject to the same restrictions on
transferability that are applicable to such shares of Restricted Stock.
X. Amendment, Suspension or Termination of the Plan.
The Board of Directors of the Company may suspend, terminate or amend this
Plan at any time. No amendment, suspension or termination of the Plan shall
deprive Outside Directors of any Restricted Stock granted under the Plan on or
before such date.
XI. Effective Date.
The effective date of the Plan is October 1, 1997.
<PAGE>
EXHIBIT 5
-------------
EXHIBIT 23.1
-------------
<PAGE>
[LETTERHEAD]
September 24, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Registration Statement on Form S-8 Relating to the ARCO Chemical
Company Restricted Stock Plan for Outside Directors
----------------------------------------------------------------
Dear Sir or Madam:
I am the Vice President, General Counsel and Secretary of ARCO Chemical Company
(the "Company"). I have reviewed the ARCO Chemical Company Restricted Stock
Plan for Outside Directors (the "Plan"), and have considered the proposed sale
of 75,000 shares of the Company's Common Stock, par value $1.00 per share
("Common Stock"), under the Plan. This opinion is furnished as an exhibit to
the Registration Statement referred to above.
Based on such examination of corporate records, documents, and questions of law
as I have considered necessary, I am of the opinion that, when the shares of
Common Stock are sold in the manner contemplated by the Registration Statement
and the Plan, they will be legally issued, fully paid, and non-assessable.
I consent to the filing of this opinion as an exhibit to the Registration
Statement referred to above.
Very truly yours,
/s/ Robert J. Millstone
EXHIBIT 5
EXHIBIT 23.1
<PAGE>
EXHIBIT 23.2
---------------
<PAGE>
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of our report dated February 12, 1997 on our audits of the consolidated
financial statements of ARCO Chemical Company as of December 31, 1996 and 1995
and for the years ended December 31, 1996, 1995, and 1994, which is included in
the Annual Report on Form 10-K of ARCO Chemical Company for the year ended
December 31, 1996.
Coopers & Lybrand L.L.P.
2400 Eleven Penn Center
Philadelphia, PA
September 24, 1997
EXHIBIT 23.2
<PAGE>
EXHIBIT 24
----------------
<PAGE>
ARCO CHEMICAL COMPANY
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Van Billet, Alan R. Hirsig, Robert J. Millstone, and Walter J. Tusinski, and
each of them, his or her true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities, to effect the following acts as
necessary or appropriate for the conduct of the business and affairs of ARCO
Chemical Company (the "Company"):
I. In connection with any outstanding security of the Company
registered pursuant to Section 12 of the Securities Exchange Act of 1934,
as amended
(1) to execute any singular or periodic report required or
permitted to be filed under the Securities Exchange Act of 1934, as
amended, including specifically the Company's Annual Report on Form 10-K
------------
for the fiscal year ended December 31, 1996; and
(2) to file or cause to be filed such report with the
Securities and Exchange Commission (the "Commission"), any national or
foreign securities exchange, any securities industry self-regulatory
organization, any state or other jurisdiction of the United States, and any
jurisdiction outside the United States, in each case as required or
permitted by applicable law;
II. In connection with the issuance, offering, or sale of any
securities authorized by the Board of Directors of the Company or by the
Executive Committee thereof pursuant to due authorization by such Board, or in
connection with the issuance, offering or sale of any security, participation or
interest in any employee or executive compensation or benefit plan authorized
and approved by the Board of Directors of the Company or by the Executive or
Compensation Committees thereof pursuant to due authorization by such Board.
(1) to execute and file, or cause to be filed, with the
Commission, (A) Registration Statements and any and all amendments
(including post-effective amendments) thereto, and to file, or cause to be
filed, all exhibits thereto and other documents in connection therewith as
required or permitted by the Commission in connection with such
registration under the Securities Act of 1993, as amended, and (B) any
singular or periodic report or other document required or permitted to be
filed by the Company with the Commission pursuant to the Securities
Exchange Act of 1934, as amended;
EXHIBIT 24
<PAGE>
(2) to execute and file, or cause to be filed, any application
for registration or exemption therefrom, or any report or any other
document required or permitted to be filed by the Company under the Blue
Sky or securities laws of any state or other jurisdiction of the United
States, and to furnish any other information required in connection
therewith, including any reports or other documents required or permitted
to be filed subsequent to the issuance of such securities;
(3) to execute and file, or cause to be filed, any application
for registration or exemption therefrom under the securities laws of any
jurisdiction outside the United States, including any reports or other
documents required or permitted to be filed subsequent to the issuance of
such securities; and
(4) to execute and file, or cause to be filed, any application
for listing such securities on any national or foreign securities exchange;
granting to such attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act required to be done as he or she
might or could do in person, hereby ratifying and confirming all that such
attorneys-in-fact and agents, and each of them, may lawfully do or cause to be
done by virtue of this Power of Attorney.
Each such attorney-in-fact and agent shall have the right to
indemnification for any action taken or omitted pursuant to this Power of
Attorney provided in the By-Laws of the Company to officers and directors for
service as such, including, but not limited to, the non-exclusivity provisions
of such By-Laws.
Each person whose signature appears below may at any time revoke this Power
of Attorney, as to himself or herself only, by an instrument in writing
specifying that this Power of Attorney is revoked as to him or her as of the
date of delivery of such revocation to the Secretary of the Company or at a
subsequent specified date. This Power of Attorney shall be revoked
automatically with respect to any person whose signature appears below effective
on the date he or she ceases to be a member of the Board of Directors, or in the
case of Mr. Billet, on the date he ceases to be principal accounting officer of
the Company, or in the case of Mr. Millstone, on the date he ceases to be Vice
President, General Counsel and Secretary. Any revocation shall not void or
otherwise affect any acts performed by any attorney-in-fact and agent named
herein pursuant to this Power of Attorney prior to the effective date of such
revocation.
This instrument may be executed in multiple counterparts each of which
shall be deemed an original and all of which together shall be deemed one
instrument.
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ ANTHONY G. FERNANDES Chairman of the Board September 24, 1997
- ------------------------------ and Director
Anthony G. Fernandes
/s/ ALAN R. HIRSIG President, September 24, 1997
- ------------------------------ Chief Executive Officer and
Alan R. Hirsig Director
/s/ MARVIN O. SCHLANGER Executive Vice President, September 24, 1997
- ------------------------------ Chief Operating Officer and
Marvin O. Schlanger Director
/s/ WALTER J. TUSINSKI Senior Vice President, September 24, 1997
- ------------------------------ Chief Financial Officer and
Walter J. Tusinski Director
/s/ WALTER F. BERAN Director September 24, 1997
- ------------------------------
Walter F. Beran
/s/ MARIE L. KNOWLES Director September 24, 1997
- ------------------------------
Marie L. Knowles
/s/ JAMES A. MIDDLETON Director September 24, 1997
- ------------------------------
James A. Middleton
/s/ STEPHEN R. MUT Director September 24, 1997
- ------------------------------
Stephen R. Mut
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ FRANK SAVAGE Director September 24, 1997
- ------------------------------
Frank Savage
/s/ ROBERT H. STEWART, III Director September 24, 1997
- ------------------------------
Robert H. Stewart, III
</TABLE>
