<PAGE> 1
As filed with the Securities and Exchange Commission on December 18, 1996
Registration No. 333-___
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
RAYCHEM CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 94-1369731
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
300 Constitution Drive, Menlo Park, California 94025-1164
(Address of Principal Executive Offices) (Zip Code)
AMENDED AND RESTATED 1990 INCENTIVE PLAN;
AMENDED AND RESTATED 1984 EMPLOYEE STOCK PURCHASE PLAN;
AMENDED AND RESTATED 1985 SUPPLEMENTAL EMPLOYEE STOCK PURCHASE PLAN;
1996 DIRECTORS STOCK OPTION PLAN
(Full Title of the Plans)
Karen O. Cottle
Raychem Corporation
300 Constitution Drive
Menlo Park, California 94025-1164
(Name and Address of Agent For Service)
(415) 361-3333
(Telephone Number, Including Area Code, of Agent For Service)
Copy to: Sarah A. O'Dowd
Heller, Ehrman, White & McAuliffe
525 University Avenue
Palo Alto, California 94301-1908
(415) 324-7000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Title Of Maximum Maximum
Securities Amount Offering Aggregate Amount Of
To Be To Be Price Per Offering Registration
Registered Registered Share (1) Price (1) Fee
---------- ---------- --------- --------- ---
<S> <C> <C> <C> <C>
Common Stock,
$1.00 par value 4,000,000 $81.625 $326,500,000 $98,940
</TABLE>
(1) Estimated (solely for the purpose of calculating the registration fee)
on the basis of the average high and low price of the registrant's Common
Shares on the New York Stock Exchange on December 13, 1996 (as reported in
the Wall Street Journal on December 16, 1996).
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This Registration Statement on Form S-8 covers 4,000,000 shares (the "Shares")
of Common Stock, par value $1.00 (the "Common Stock"), of Raychem Corporation, a
Delaware corporation ("Registrant"). Of the shares (i) 2,800,000 shares of
Common Stock are being registered under the Registrant's Amended and Restated
1990 Incentive Stock Plan, (ii) 1,000,000 shares of Common Stock are being
registered under the Registrant's Amended and Restated 1984 Employee Stock
Purchase Plan and Amended and Restated 1985 Supplemental Employee Stock Purchase
Plan, and (iii) 200,000 shares of Common Stock are being registered under the
Registrant's 1996 Directors Stock Option Plan.
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed or to be filed with the Securities and Exchange
Commission (the "Commission") by the Registrant are incorporated by reference in
this registration statement:
(a) The Registrant's latest annual report (Form 10-K) filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") that contains audited financial statements
for the Registrant's latest fiscal year for which such statements have
been filed;
(b) All other reports filed by the Registrant pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year covered by
the annual report referred to in (a) above;
(c) The description of the Common Stock of the Registrant contained in the
registration statement filed under the Exchange Act registering such
Common Stock under Section 12 of the Exchange Act.
All documents subsequently filed by the Registrant pursuant to Section 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 this registration statement and to be part thereof
from the date of filing of such documents.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102 of the Delaware General Corporation Law allows a corporation to
include in its Certificate of Incorporation a provision to eliminate the
personal liability of a director to the corporation or to any of its
stockholders for monetary damage for a breach of his fiduciary duty as a
director, except in the case where the director breached his duty of loyalty,
failed to act in good faith, engaged in intentional misconduct or knowingly
violated a law, authorized the payment of a dividend or approved a stock
repurchase in violation of Delaware corporate law or obtained an improper
personal benefit. The Registrant's Amended and Restated Certificate of
Incorporation contains a provision that eliminates directors' personal liability
as set forth above.
Section 145 of the Delaware General Corporation Law provides that a
corporation may 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, by reason
of the fact that he is or was a director, officer, employee or agent of the
corporation or is or was serving at its request in such capacity in another
corporation or business association against expenses (including attorneys'
fees),
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<PAGE> 3
judgments, fines and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit or proceeding if he acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
In addition, Article 8 of the Registrant's Amended and Restated Certificate of
Incorporation provides as follows:
Limitation of Liability and Indemnification of Directors.
A. Elimination of Certain Liability of Directors. A director of the
Corporation shall not be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability (i) for any breach of the director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the Delaware General Corporation Law, or (iv) for any transaction
from which the director derived an improper personal benefit.
B. Indemnification and Insurance
(1) Right to Indemnification. Each person who was or is made a
party or is threatened to be made a party to or is involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding") by reason of the fact that he or she, or a person
of whom he or she is the legal representative, is or was a director or officer
of the Corporation or is or was serving at the request of the Corporation 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), whether the basis of the proceeding is alleged action
in an official capacity as a director, officer, employee or agent or in any
other capacity while serving as a director, officer, employee or agent, shall be
indemnified and held harmless by the Corporation to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than said law permitted the Corporation to provide prior to such
amendment), against all expense, liability and loss (including attorneys' fees,
judgments, fines, Employee Retirement Income Security Act of 1974 excise taxes
or penalties and amounts paid or to be 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, officer, employee
or agent and shall inure to the benefit of his or her heirs, executors and
administrators; provided, however, that the Corporation shall indemnify any such
person seeking indemnification in connection with a proceeding (or part thereof)
initiated by such person only if such proceeding (or part thereof) was
authorized by the Board of Directors of the Corporation. The right to
indemnification conferred in this Section shall be a contract right and shall
include the right to be paid by the Corporation the expenses incurred in
defending any such proceeding in advance of the final disposition; provided,
however, that, if the Delaware General Corporation Law requires, the payment of
such expenses incurred by a director or officer in his or her capacity as a
director or officer (and not in any other capacity in which service was or is
rendered by such person while a director or officer, including, without
limitation, service with respect to an employee benefit plan) in advance of the
final disposition of a proceeding, shall be made only upon delivery to the
Corporation of an undertaking, by or on behalf of such director or officer, to
repay all amounts so advanced if ultimately it shall be determined that such
director or officer is not entitled to be indemnified under this Section or
otherwise. The Corporation may, by action of its Board of Directors, provide
indemnification to employees and agents of the Corporation with the same scope
and effect as the foregoing indemnification of directors and officers.
(2) Nonexclusivity 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,
provisions of this Certificate of Incorporation, Bylaws, agreement, vote of
stockholders or disinterested directors or otherwise.
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<PAGE> 4
(3) Insurance. The Corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent of the
Corporation or another corporation, partnership, joint venture, trust or other
enterprise against any such expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
The Company has purchased directors and officers liability insurance
which may indemnify the directors and officers of the Company (subject to policy
deductibles) against damages arising out of certain kinds of claims made against
them based on their negligent acts or omissions while acting in their capacity
as directors and officers.
ITEM 8. EXHIBITS
<TABLE>
<CAPTION>
<S> <C>
5 Opinion of Heller, Ehrman, White & McAuliffe
23.1 Consent of Heller, Ehrman, White & McAuliffe
(filed as part of Exhibit 5)
23.2 Consent of Price Waterhouse LLP, Independent Accountants
24 Power of Attorney (see pages 6-7)
99.1 Amended and Restated 1990 Incentive Plan
99.2 Amended and Restated 1984 Employee Stock Purchase Plan
99.3 Amended and Restated 1985 Supplemental Employee Stock Purchase Plan
99.4 1996 Directors Stock Option Plan
</TABLE>
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 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.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or 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.
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(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, each filing of the Registrant'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.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the
final adjudication of such issue.
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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 Menlo Park, state of California, on this 18th day of
December, 1996.
RAYCHEM CORPORATION
By: /s/ Raymond J. Sims
_______________________________________
Raymond J. Sims
Senior Vice President and Chief
Financial Officer
POWER OF ATTORNEY TO SIGN AMENDMENTS
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
does hereby constitute and appoint Richard A. Kashnow, Raymond J. Sims and Karen
O. Cottle, and each of them, with full power of substitution and full power to
act without the other such person's true and lawful attorney-in-fact and agent
for such person in such person's name, place and stead, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement on Form S-8 and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, 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
in order to effectuate the same as fully, to all intents and purposes, as they
or such person might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement on Form S-8 has been signed by the following persons in the capacities
and on the dates indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Richard A. Kashnow President, Chief December 18, 1996
_________________________ Executive Officer and
Richard A. Kashnow Chairman of the Board
of Directors (Principal
Executive Officer)
/s/ Raymond J. Sims Senior Vice President and December 18, 1996
_________________________ Chief Financial Officer
Raymond J. Sims (Principal Financial
Officer)
/s/ Deidra D. Barsotti Vice President and December 18, 1996
_________________________ Controller (Principal
Deidra D. Barsotti Accounting Officer)
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Richard Dulude Director December 18, 1996
- -------------------------
Richard Dulude
/s/ James F. Gibbons Director December 18, 1996
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James F. Gibbons
/s/ John P. McTague Director December 18, 1996
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John P. McTague
/s/ Dean O. Morton Director December 18, 1996
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Dean O. Morton
/s/ Isaac Stein Director December 18, 1996
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Isaac Stein
/s/ Chang-Lin Tien Director December 18, 1996
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Chang-Lin Tien
/s/ Cyril J. Yansouni Director December 18, 1996
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Cyril J. Yansouni
</TABLE>
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Index to Exhibits
<TABLE>
<CAPTION>
Sequentially
Numbered
Item No. Description of Item Page
-------- ------------------- ----
<S> <C> <C>
5 Opinion of Heller, Ehrman, White & McAuliffe
23.1 Consent of Heller, Ehrman, White & McAuliffe (filed as part of
Exhibit 5)
23.2 Consent of Price Waterhouse LLP, Independent Accountants
24 Power of Attorney (see pages 6 and 7)
99.1 Amended and Restated 1990 Incentive Plan
99.2 Amended and Restated 1984 Employee Stock Purchase Plan
99.3 Amended and Restated 1985 Supplemental Employee Stock Purchase
Plan
99.4 1996 Directors Stock Option Plan
</TABLE>
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<PAGE> 1
EXHIBIT 5.0
December 18, 1996
11850-0200
Raychem Corporation
300 Constitution Drive
Menlo Park, California 94025-1164
Registration Statement on Form S-8
----------------------------------
Ladies and Gentlemen:
We have acted as counsel to Raychem Corporation a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-8 (the "Registration Statement") which the Company proposes to file with
the Securities and Exchange Commission on or about December 18, 1996 for the
purpose of registering under the Securities Act of 1933, as amended, an
additional 4,000,000 shares of Common Stock of the Company (the "Shares"),
pursuant to the Company's Amended and Restated 1990 Incentive Plan, the
Company's Amended and Restated 1984 Employee Stock Purchase Plan, the Company's
Amended and Restated 1985 Supplemental Employee Stock Purchase Plan, and the
Company's 1996 Directors Stock Option Plan (the "Plans").
We have assumed the authenticity of all records, documents and
instruments submitted to us as originals, the genuineness of all signatures,
the legal capacity of natural persons and the conformity to the originals of
all records, documents and instruments submitted to us as copies.
In rendering our opinion, we have examined the following
records, documents and instruments:
(a) The Amended and Restated Certificate of Incorporation
of the Company, certified by the Secretary of State
of the State of Delaware as of December 17, 1996 and
certified to us by an officer of the Company as being
complete and in full force and effect as of the date
of this opinion;
<PAGE> 2
Raychem Corporation
December 18, 1996
Page 2
(b) The Bylaws of the Company, certified to us by an
officer of the Company as being complete and in full
force and effect as of the date of this opinion;
(c) A Certificate of the Senior Vice President and Chief
Financial Officer of the Company (i) attaching
records certified to us as constituting all records
of proceedings and actions of the Board of Directors
and stockholders of the Company relating to the Plans
and the Registration Statement, and (ii) certifying
as to certain factual matters;
(d) The Registration Statement;
(e) The Plans; and
(f) A letter from Harris Trust and Savings Bank, the
Company's transfer agent, dated December 13, 1996, as
to the number of shares of the Company's Common Stock
outstanding on December 12, 1996.
This opinion is limited to the Delaware General Corporation
Law, and we disclaim any opinion as to the laws of any other jurisdiction. We
further disclaim any opinion as to any other statute, rule, regulation,
ordinance, order or other promulgation of any other jurisdiction or any regional
or local governmental body or as to any related judicial or administrative
opinion.
Based upon the foregoing and our examination of such questions
of law as we have deemed necessary or appropriate for the purpose of this
opinion, and assuming that (i) the Registration Statement becomes and remains
effective during the period when the Shares are offered and issued, (ii) the
full consideration stated in the Plans is paid for each Share and that such
consideration in respect of each Share includes payment of cash or other lawful
consideration at least equal to the par value thereof, (iii) all applicable
securities laws are complied with, and (iv) appropriate certificates evidencing
the Shares will be executed and delivered upon issuance of the Shares, it is
our opinion that when issued and sold by the Company, after payment therefor in
the manner provided in the Plans and in the Registration Statement, the Shares
will be validly issued, fully paid and nonassessable.
This opinion is rendered to you in connection with the
Registration Statement and is solely for your benefit. This opinion may not be
relied upon by you for any other purpose, or relied upon by any other person,
firm, corporation or other entity for any purpose, without our prior written
consent. We disclaim any obligation to advise you of any change of law that
occurs, or any facts of which we become aware, after the date of this opinion.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement.
Very truly yours,
/s/ HELLER EHRMAN WHITE & MCAULIFFE
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated July 17, 1996, which
appears on page 21 of the 1996 Annual Report to Stockholders of Raychem
Corporation, which is incorporated by reference in Raychem Corporation's Annual
Report on Form 10-K for the year ended June 30, 1996. We also consent to the
incorporation by reference of our report on the Financial Statement Schedule,
which appears on page 14 of such Annual Report on Form 10-K.
Price Waterhouse LLP
San Jose, California
December 18, 1996
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EXHIBIT 99.1
RAYCHEM CORPORATION
AMENDED AND RESTATED 1990 INCENTIVE PLAN
SECTION 1. PURPOSE; DEFINITIONS.
(a) Purpose. The purpose of the Plan is to provide selected eligible
employees of, and consultants to, Raychem Corporation, a Delaware corporation,
its subsidiaries and affiliates an opportunity to participate in the Company's
future by offering them an opportunity to acquire stock in the Company so as to
retain, attract and motivate them.
(b) Definitions. For purposes of the Plan, the following terms have the
following meanings:
(i) "Award" means any award under the Plan, including any
Option, Restricted Stock, or Performance Share Award.
(ii) "Award Agreement" means, with respect to each Award, the
signed written agreement between the Company and the Plan participant
setting forth the terms and conditions of the Award.
(iii) "Board" means the Board of Directors of the Company.
(iv) "Change in Control" has the meaning set forth in Section
8(a).
(v) "Change in Control Price" has the meaning set forth in
Section 8(c).
(vi) "Code" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor statute.
(vii) "Commission" means the Securities and Exchange
Commission and any successor agency.
(viii) "Committee" means the Committee referred to in Section
2, or the Board in its capacity as administrator of the Plan in
accordance with Section 2.
(ix) "Company" means Raychem Corporation, a Delaware
corporation.
(x) "Disability" means permanent and total disability as
determined by the Committee for purposes of the Plan.
(xi) "Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time, and any successor statute.
(xii) "Fair Market Value" means as of any given date the
closing sales price of the Stock reported on the New York Stock
Exchange Composite Tape or, if no sale of Stock occurs on such date,
the fair market value of the Stock as determined by the Committee in
good faith.
(xiii) "Incentive Stock Option" means any Option intended to
be and designated as an "incentive stock option" within the meaning of
Section 422 of the Code.
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(xiv) "Option" means an option granted under Section 5.
(xv) "Performance Criteria" shall mean the following measures
of performance: total stockholder return, stock price, cash value
added, economic value added, operating margin, asset turnover, sales
growth, asset growth, return on investment, earnings per share, return
on equity, return on assets, return on capital, operating cash flow,
cost of capital, net income, net operating profit, customer
satisfaction, and employee satisfaction.
(xvi) "Performance Period" means the period determined by the
Committee under Section 7(a).
(xvii) "Performance Share" means the equivalent, as of any
time such assessment is made, of the Fair Market Value of one share of
Stock.
(xviii) "Performance Share Award" means an Award under Section
7.
(xix) "Plan" means this Raychem Corporation 1990 Incentive
Plan, as amended from time to time.
(xx) "Restricted Stock" means an Award of Stock subject to
restrictions, as more fully described in Section 6.
(xxi) "Restriction Period" means the period determined by the
Committee under Section 6(b).
(xxii) "Retirement" has the same meaning as in the "Raychem
Corporation Pension Plan" as in effect from time to time.
(xxiii) "Rule 16b-3" means Rule 16b-3 under Section 16(b) of
the Exchange Act, as amended from time to time, and any successor rule.
(xxiv) "Stock" means the Common Stock, $1.00 par value, of the
Company, and any successor security.
(xxv) "Subsidiary" has the meaning set forth in Section 424 of
the Code.
(xxvi) "Supplemental Stock Option" means any Option that is
not an Incentive Stock Option.
(xxvii) "Tax Date" means the date defined in Section 9(f).
(xxviii) "Termination" means, for purposes of the Plan, with
respect to a participant, that the participant has ceased to be, for
any reason, employed by, or consulting to, the Company, a subsidiary or
an affiliate; provided, however, that for purposes of this definition,
Termination shall not include a change in status from an employee of,
to a consultant to, the Company or any subsidiary or affiliate, or vice
versa.
SECTION 2. ADMINISTRATION.
(a) Committee. The Plan shall be administered by the Board or, upon
delegation by the Board, either in its entirety or only as it relates to persons
subject to Section 16 of the Exchange Act, by a committee of the Board. In
connection with the administration of the Plan, the Committee shall have the
powers possessed by the Board. The Committee may act only by a majority of its
members, except that
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<PAGE> 3
the Committee (i) may authorize any one or more of its members or any officer of
the Company to execute and deliver documents on behalf of the Committee and (ii)
so long as not otherwise required for the Plan to comply with Rule 16b-3, may
delegate to one or more officers or directors of the Company authority to grant
Awards to persons who are not subject to Section 16 of the Exchange Act with
respect to Stock. The Board at any time may abolish the Committee and revest in
the Board the administration of the Plan.
(b) Authority. The Committee shall grant Awards to eligible employees
and consultants. In particular and without limitation, the Committee, subject to
the terms of the Plan, shall:
(i) select the officers, employees and consultants to whom
Awards may be granted;
(ii) determine whether and to what extent Awards are to be
granted under the Plan;
(iii) determine the number of shares to be covered by each
Award granted under the Plan;
(iv) determine the terms and conditions of any Award granted
under the Plan and any related loans to be made by the Company, based
upon factors determined by the Committee; and
(v) determine to what extent and under what circumstances any
Award payments may be deferred by a participant.
(c) Committee Determinations Binding. The Committee may adopt, alter
and repeal administrative rules, guidelines and practices governing the Plan as
it from time to time shall deem advisable, may interpret the terms and
provisions of the Plan, any Award and any Award Agreement and may otherwise
supervise the administration of the Plan. Any determination made by the
Committee pursuant to the provisions of the Plan with respect to any Award shall
be made in its sole discretion at the time of the grant of the Award or, unless
in contravention of any express term of the Plan or Award, at any later time.
All decisions made by the Committee under the Plan shall be binding on all
persons, including the Company and Plan participants.
SECTION 3. STOCK SUBJECT TO PLAN.
(a) Number of Shares. The total number of shares of Stock reserved and
available for issuance pursuant to Awards under the Plan shall be 7,750,000
shares. Such shares may consist, in whole or in part, of authorized and unissued
shares or treasury shares or shares reacquired in private transactions or open
market purchases, but all shares issued under the Plan regardless of source
shall be counted against the 7,750,000 share limitation.
(b) Adjustments. In the event of any merger, reorganization,
consolidation, recapitalization, stock dividend, stock split or other change in
corporate structure affecting the Stock, such substitution or adjustments shall
be made in the aggregate number of shares of Stock reserved for issuance under
the Plan, in the number of shares of Stock specified in Section 3(c), in the
number and exercise price of shares subject to outstanding Options, and in the
number of shares subject to other outstanding Awards, as may be determined to be
appropriate by the Committee, in its sole discretion; provided, however, that
the number of shares subject to any Award shall always be a whole number.
(c) Individual Limitation. The Company may not issue Options or
Performance Shares with a Fair Market Value exercise price as of the date of
grant covering in the aggregate more than 500,000 shares of Stock (subject to
adjustments and substitutions as required under Section 3(b) above) to any one
participant in any one-year period. If and when the Committee establishes
performance criteria for the award of Options with an exercise price of less
than Fair Market Value or the award of Restricted Stock,
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<PAGE> 4
the Company may limit the number of shares issuable under such Awards to the
extent required to comply with the limitation on amounts deductible by the
Company under Section 162(m) of the Code.
SECTION 4. ELIGIBILITY.
Awards may be granted to officers and other key employees of, and
consultants to, the Company, its subsidiaries and affiliates (excluding members
of the Committee and any person who serves only as a director).
SECTION 5. STOCK OPTIONS.
(a) Types. Any Option granted under the Plan shall be in such form as
the Committee may from time to time approve. The Committee shall have the
authority to grant to any participant Incentive Stock Options, Supplemental
Stock Options or both types of Options. Incentive Stock Options may be granted
only to employees of the Company, its parent (within the meaning of Section 424
of the Code) or Subsidiaries. Any portion of an Option that is not designated
as, or does not qualify as, an Incentive Stock Option shall constitute a
Supplemental Stock Option.
(b) Terms and Conditions. Options granted under the Plan shall be
subject to the following terms and conditions:
(i) Option Term. The term of each Option shall be fixed by the
Committee, but no Incentive Stock Option shall be exercisable more than
ten (10) years after the date the Option is granted, and no
Supplemental Stock Option shall be exercisable more than fifteen (15)
years after the date the Option is granted. If, at the time the Company
grants an Incentive Stock Option, the optionee owns directly or by
attribution stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company, or any parent or
Subsidiary of the Company, the Incentive Stock Option shall not be
exercisable more than five (5) years after the date of grant.
(ii) Grant Date. The Company may grant Options under the Plan
at any time and from time to time before the Plan terminates. The
Committee shall specify the date of grant or, if it fails to, the date
of grant shall be the date of action taken by the Committee to grant
the Option. However, if an Option is approved in anticipation of
employment, the date of grant shall be the date the intended optionee
is first treated as an employee for payroll purposes.
(iii) Exercise Price. Except as provided in Section 9(v), the
exercise price per share of Stock purchasable under an Option shall be
equal to at least 85% of the Fair Market Value on the date of grant,
and in the case of Incentive Stock Options shall be equal to at least
the Fair Market Value on the date of grant; provided, however, that if,
at the time the Company grants an Incentive Stock Option, the optionee
owns directly or by attribution stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company, or
any parent or Subsidiary of the Company, then the exercise price shall
be not less than 110% of the Fair Market Value on the date the
Incentive Stock Option is granted.
(iv) Exercisability. Subject to the other provisions of the
Plan, an Option shall be exercisable in its entirety at grant or at
such times and in such amounts as are specified in the Award Agreement
evidencing the Option. The Committee, in its absolute discretion, at
any time may waive any limitations respecting the time at which an
Option first becomes exercisable in whole or in part.
(v) Method of Exercise; Payment. To the extent the right to
purchase shares has accrued, Options may be exercised, in whole or in
part, from time to time, by written notice from the optionee to the
Company stating the number of shares being purchased, accompanied by
payment of the exercise price for the shares.
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(vi) No Disqualification. Notwithstanding any other provision
in the Plan, no term of the Plan relating to Incentive Stock Options
shall be interpreted, amended or altered nor shall any discretion or
authority granted under the Plan be exercised so as to disqualify the
Plan under Section 422 of the Code or, without the consent of the
optionee affected, to disqualify any Incentive Stock Option under such
Section 422.
SECTION 6. RESTRICTED STOCK.
(a) Price. Participants awarded Restricted Stock, within forty-five
(45) days of receipt of the applicable Award Agreement, which in no event shall
be later than ten (10) days after the Award grant date, shall pay to the Company
an amount equal to the par value of the Stock subject to the Award. If such
payment is not made and received by the Company by such date, the Award of
Restricted Stock shall lapse.
(b) Restrictions. Except as provided in Section 9(v), subject to the
provisions of the Plan and the Award Agreement, during the Restriction Period
set by the Committee, commencing with, and not exceeding ten (10) years from,
the date of such award, the participant shall not be permitted to sell, assign,
transfer, pledge or otherwise encumber shares of Restricted Stock. Within these
limits, the Committee may provide for the lapse of such restrictions in
installments and may accelerate or waive such restrictions, in whole or in part,
based on service, performance or such other factors or criteria as the Committee
may determine.
(c) Dividends. Unless otherwise determined by the Committee, with
respect to dividends on shares of Restricted Stock, dividends payable in cash
shall be automatically reinvested in additional Restricted Stock, and dividends
payable in Stock shall be paid in the form of Restricted Stock.
(d) Termination. Except to the extent otherwise provided in the Award
Agreement and pursuant to Section 6(b), in the event of a Termination during the
Restriction Period, all shares still subject to restriction shall be forfeited
by the participant.
SECTION 7. PERFORMANCE SHARES.
(a) Awards. The Committee shall determine the nature, length and
starting date of the Performance Period for each Performance Share Award, which
period shall be at least two (2) years (subject to Section 8) and not more than
six (6) years. The consideration payable by a participant with respect to a
Performance Share Award shall be an amount determined by the Committee in the
exercise of the Committee's discretion at the time of the Award; provided,
however, that the amount of consideration may be zero and may in no event exceed
50% of the Fair Market Value at the time of grant. The Committee shall determine
the Performance Criteria to be used in awarding Performance Shares and the
extent to which such Performance Shares have been earned. Performance Periods
may overlap and participants may participate simultaneously with respect to
Performance Share Awards that are subject to different Performance Periods and
different performance factors and criteria. At the beginning of each Performance
Period, the Committee shall determine for each Performance Share Award subject
to such Performance Period the number of shares of Stock (which may consist of
Restricted Stock) to be awarded to the participant at the end of the Performance
Period if and to the extent that the Performance Criteria for such Performance
Share Awards are met. Such number of shares of Stock may be fixed or may vary in
accordance with such Performance Criteria as may be determined by the Committee.
The Committee may provide that (i) amounts equivalent to interest at such rates
as the Committee may determine, or (ii) amounts equivalent to dividends paid by
the Company upon outstanding Stock shall be payable with respect to Performance
Share Awards.
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(b) Termination. Except as otherwise provided in the Award Agreement or
determined by the Committee, in the event of a Termination during a Performance
Period, the participant shall not be entitled to any payment with respect to the
Performance Shares subject to the Performance Period.
(c) Form of Payment. Payment shall be made in the form of cash or whole
shares of Stock, as the Committee, in its discretion, shall determine.
SECTION 8. CHANGE IN CONTROL.
(a) Definition of "Change in Control". For purposes of Section 8(b), a
"Change in Control" means the occurrence of any one of the following:
(i) Any "person", as such term is used in Sections 13(d) and
14(d) of the Exchange Act (other than the Company, a subsidiary, an
affiliate, or a Company employee benefit plan, including any trustee of
such plan acting as trustee) is or becomes the "beneficial owner" (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of securities of the Company representing 20% or more of the combined
voting power of the Company's then outstanding securities;
(ii) the solicitation of proxies (within the meaning of Rule
14a-1(k) under the Exchange Act and any successor rule with respect to
the election of any director of the Company where such solicitation is
for any candidate who is not a candidate proposed by a majority of the
Board in office prior to the time of such election; or
(iii) the dissolution or liquidation (partial or total) of the
Company or a sale of assets involving 30% or more of the assets of the
Company, any merger or reorganization of the Company whether or not
another entity is the survivor, a transaction pursuant to which the
holders, as a group, of all of the shares of the Company outstanding
prior to the transaction hold, as a group, less than 70% of the shares
of the Company outstanding after the transaction, or any other event
which the Committee determines, in its discretion, would materially
alter the structure of the Company or its ownership.
(b) Impact of Event. In the event of a "Change in Control" as defined
in Section 8(a), but only if and to the extent so specifically determined by the
Committee in its discretion, which determination may be amended or reversed only
by the affirmative vote of a majority of the persons who were members of the
Committee at the time such determination was made, acceleration and valuation
provisions no more favorable to participants than the following may apply:
(i) Subject to Section 5(b)(vi), any Options outstanding as of
the date such Change in Control is determined to have occurred and not
then exercisable and vested shall become fully exercisable and vested.
(ii) The restrictions and limitations applicable to any
Restricted Stock shall lapse, and such Restricted Stock shall become
fully vested.
(iii) The value (net of any exercise price) of all outstanding
Options and Restricted Stock, unless otherwise determined by the
Committee at or after grant and subject to Rule 16b-3, shall be cashed
out on the basis of the "Change in Control Price", as defined in
Section 8(c), as of the date such Change in Control is determined to
have occurred or such other date as the Committee may determine prior
to the Change in Control.
(iv) Any outstanding Performance Share Awards shall be vested
and paid in full as if all performance criteria had been met.
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(c) Change in Control Price. For purposes of this Section 8, "Change in
Control Price" means the highest price per share paid in any transaction
reported on the New York Stock Exchange Composite Tape or paid or offered in any
bona fide transaction related to a potential or actual Change in Control of the
Company at any time during the preceding 60-day period as determined by the
Committee, except that, in the case of Incentive Stock Options, such price shall
be based only on transactions reported for the date on which the Committee
decides to cash out such Options.
SECTION 9. GENERAL PROVISIONS.
(a) Award Grants. Any Award may be granted either alone or in addition
to other Awards granted under the Plan. Subject to the terms and restrictions
set forth elsewhere in the Plan, the Committee shall determine the
consideration, if any, payable by the participant for any Award and, in addition
to those set forth in the Plan, any other terms and conditions of the Awards.
Subject to the terms and restrictions set forth elsewhere in the Plan, the
Committee may condition the grant or payment of any Award upon the attainment of
specified performance goals or such other factors or criteria, including vesting
based on continued employment or consulting, as the Committee shall determine.
Performance objectives may vary from participant to participant and among groups
of participants and shall be based upon such Company, subsidiary, group or
division factors or criteria as the Committee may deem appropriate, including,
but not limited to, earnings per share or return on equity. The other provisions
of Awards also need not be the same with respect to each recipient. Unless
specified otherwise in the Plan or by the Committee, the date of grant of an
Award shall be the date of action by the Committee to grant the Award. The
Committee may also substitute new Options for previously granted options,
including previously granted Options having higher exercise prices.
(b) Award Agreement. As soon as practicable after the date of an Award
grant, the Company and the participant shall enter into a written Award
Agreement identifying the date of grant, and specifying the terms and conditions
of the Award. Options are not exercisable until after execution of the Award
agreement by the Company and the Plan participant, but a delay in execution of
the agreement shall not affect the validity of the Option grant.
(c) Certificates. All certificates for shares of Stock or other
securities delivered under the Plan shall be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem advisable under
the rules, regulations and other requirements of the Commission, any stock
exchange upon which the Stock is then listed and any applicable federal, state
or foreign securities law.
(d) Termination. Unless otherwise provided in the applicable Award
Agreement or by the Committee, in the event of Termination for any reason other
than death, Retirement or Disability, Awards held at the date of Termination
(and only to the extent then exercisable or payable, as the case may be) may be
exercised in whole or in part at any time within three (3) months after the date
of Termination, or such lesser period specified in the Award Agreement (but in
no event after the expiration date of the Award), but not thereafter. If
Termination is due to death or Disability or, in the case of Awards granted
prior to August 2, 1991, Retirement, Awards held at the date of Termination (and
only to the extent then exercisable or payable, as the case may be) may be
exercised in whole or in part by the participant in the case of Retirement or
Disability, by the participant's guardian or legal representative or by the
person to whom the Award is transferred by will or the laws of descent and
distribution, at any time within two (2) years from the date of Termination or
any lesser period specified in the Award Agreement (but in no event after the
expiration of the Award). For Awards granted on or after August 2, 1991 and
before August 12, 1994, if Termination is due to Retirement, Awards held at the
date of Termination shall become fully exercisable or payable, as the case may
be, and may be exercised, in whole or in part, by the participant, by the
participant's guardian or legal representative or by the person to whom the
Award is transferred by will or the laws of descent and distribution, at any
time within three (3) years from the date of such Termination or any lesser
period specified in the Award Agreement (but in no event after the expiration of
the Award). For Awards granted on or after August 12, 1994, if Termination is
due to Retirement, Awards held at the date of Termination shall become fully
exercisable or payable, as the case may be, and may
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be exercised, in whole or in part, by the participant, by the participant's
guardian or legal representative or by the person to whom the Award is
transferred by will or the laws of descent and distribution, at any time within
five (5) years from the date of such Termination or any lesser period specified
in the Award Agreement (but in no event after the expiration of the Award).
(e) Delivery of Purchase Price. If and only to the extent authorized by
the Committee, participants may make all or any portion of any payment due to
the Company
(i) with respect to the consideration payable for an Award,
(ii) upon exercise of an Award, or
(iii) with respect to federal, state, local or
foreign tax payable in connection with an Award, by delivery of (x)
cash, (y) check, or (z) any property other than cash (including a
promissory note of the participant or shares of Stock or securities) so
long as, if applicable, such property constitutes valid consideration
for the Stock under applicable law. No promissory note under the Plan
shall have a term (including extensions) of more than five (5) years or
shall be of a principal amount exceeding 90% of the purchase price paid
by the borrower. To the extent participants may make payments due to
the Company upon grant or exercise of Awards by the delivery of shares
of Stock or other securities, the Committee, in its discretion, may
permit participants constructively to deliver for any such payment
securities of the Company held by the participant for at least three
(3) months or, if such securities were acquired through the exercise of
an Award, for at least six (6) months. Constructive delivery shall be
effected by (i) identification by the participant of shares intended to
be delivered constructively, (ii) confirmation by the Company of
participant's ownership of such shares (for example, by reference to
the Company's stock records, or by some other means of verification),
and (iii) if applicable, upon exercise, delivery to the participant of
a certificate for that number of shares equal to the number of shares
for which the Award is exercised less the number of shares
constructively delivered. If authorized by the Committee, exercise of
an Option may be made pursuant to a "cashless exercise/sale" procedure
pursuant to which funds to pay for exercise of the Option are delivered
to the issuer by a broker upon receipt of stock certificates from the
issuer, or pursuant to which participants obtain margin loans from
brokers to fund the exercise of the Option.
(f) Tax Withholding. If and to the extent authorized by the Committee,
in its sole discretion, a person who has received an Award or payment under an
Award, may make an election (i) to deliver to the Company a promissory note of
the participant on the terms set forth in Section 9(e), (ii) to tender to the
Company previously owned shares of Stock, or (iii) to have shares of Stock to be
obtained upon exercise of the Award or lapse of restrictions applicable to an
Award withheld by the Company on behalf of the participant, to pay the amount of
tax that the Committee, in its discretion, determines to be required to be
withheld by the Company.
Any shares tendered to or withheld by the Company shall be valued at
Fair Market Value on such date. The value of the shares of Stock tendered or
withheld may not exceed the required federal, state, local and foreign
withholding tax obligations as computed by the Company.
Unless the Committee permits otherwise, the participant shall pay to
the Company in cash, promptly when the amount of such obligations becomes
determinable, all applicable federal, state, local and foreign withholding taxes
that the Committee, in its discretion, determines to result from the lapse of
restrictions imposed upon an Award or upon exercise of an Award or from a
transfer or other disposition of shares of Stock acquired upon exercise or
payment of an Award or otherwise related to the Award or shares of Stock
acquired in connection with an Award.
(g) No Transferability. No Award shall be assignable or otherwise
transferable by the participant other than by will or by the laws of descent and
distribution, except as expressly permitted in the participant's Award
Agreement. During the life of a participant, except as expressly permitted in
the
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Award Agreement, an Award shall be exercisable, and any elections with respect
to an Award may be made, only by the participant or participant's guardian or
legal representative.
(h) Adjustment of Awards; Waivers. Subject to Section 5(b)(vi), the
Committee may adjust the performance goals and measurements applicable to Awards
(i) to take into account changes in law and accounting and tax rules, (ii) to
make such adjustments as the Committee deems necessary or appropriate to reflect
the inclusion or exclusion of the impact of extraordinary or unusual items,
events or circumstances in order to avoid windfalls or hardships, and (iii) to
make such adjustments as the Committee deems necessary or appropriate to reflect
any material changes in business conditions. In the event of hardship or other
special circumstances of a participant and otherwise in its discretion, the
Committee may waive in whole or in part any or all restrictions, conditions,
vesting, or forfeiture with respect to any Award granted to such participant.
(i) Non-Competition. The Committee may condition its discretionary
waiver of a forfeiture, the acceleration of vesting at the time of Termination
of a participant holding any unexercised or unearned Award, the waiver of
restrictions on any Award, or the extension of the expiration period to a period
not longer than that provided by the Plan upon such participant's agreement (and
compliance with such agreement) to (i) not engage in any business or activity
competitive with any business or activity conducted by the Company and (ii) be
available for consultations at the request of the Company's management, all on
such terms and conditions (including conditions in addition to (i) and (ii)) as
the Committee may determine.
(j) Dividends. The reinvestment of dividends in additional Stock or
Restricted Stock at the time of any dividend payment pursuant to Section 6(c)
shall only be permissible if sufficient shares of Stock are available under
Section 3 for such reinvestment (taking into account then outstanding Awards).
(k) Regulatory Compliance. Each Award under the Plan shall be subject
to the condition that, if at any time the Committee shall determine that (i) the
listing, registration or qualification of the shares of Stock, Common Shares, or
Preferred Shares upon any securities exchange or under any state or federal law,
(ii) the consent or approval of any government or regulatory body or (iii) an
agreement by the participant with respect thereto, is necessary or desirable,
then such Award shall not be consummated in whole or in part unless such
listing, registration, qualification, consent, approval or agreement shall have
been effected or obtained free of any conditions not acceptable to the
Committee.
(l) Listing. So long as the Stock is listed on the New York Stock
Exchange, shares of Stock for use under the provisions of the Plan shall not be
issued until they have been duly listed, upon official notice of issuance, on
the New York Stock Exchange and any other exchanges determined by the Board.
(m) Rights as Stockholder. Unless the Plan or the Committee expressly
specifies otherwise, an optionee shall have no rights as a stockholder with
respect to any shares covered by an Award until the issuance (as evidenced by
the appropriate entry on the books of the Company or a duly authorized transfer
agent) of a certificate evidencing the shares of Stock. Subject to Sections 3(b)
and 6(c), no adjustment shall be made for dividends or other rights for which
the record date precedes the date the certificate is issued.
(n) Beneficiary Designation. The Committee, in its discretion, may
establish procedures for a participant to designate a beneficiary to whom any
amounts payable in the event of the participant's death are to be paid.
(o) Additional Plans. Nothing contained in the Plan shall prevent the
Company, a subsidiary or an affiliate from adopting other or additional
compensation arrangements for its employees and consultants.
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(p) No Employment Rights. The adoption of the Plan shall not confer
upon any employee any right to continued employment nor shall it interfere in
any way with the right of the Company, a subsidiary or an affiliate to terminate
the employment of any employee at any time.
(q) Rule 16b-3. Notwithstanding any provision of the Plan, Awards shall
always be granted and exercised in such a manner as to conform to the provisions
of Rule 16b-3.
(r) Governing Law. Except as required by the Delaware General
Corporation Law, the Plan and all Awards shall be governed by and construed in
accordance with the laws of the State of California.
(s) Use of Proceeds. All cash proceeds to the Company under the Plan
shall constitute general funds of the Company.
(t) Unfunded Status of Plan. The Plan shall constitute an "unfunded"
plan for incentive and deferred compensation. The Committee may authorize the
creation of trusts or arrangements to meet the obligations created under the
Plan to deliver Stock or make payments; provided, however, that unless the
Committee otherwise determines, the existence of such trusts or other
arrangements shall be consistent with the "unfunded" status of the Plan.
(u) Assumption by Successor. The obligations of the Company under the
Plan and under any outstanding Award may be assumed by any successor
corporation, which for purposes of the Plan shall be included within the meaning
of "Company".
(v) Award Limitations
(i) Notwithstanding the provisions of Section 5(b) (iii),
except as provided in Section 9(v) (iv) and (v) below, the exercise price per
share of Stock purchasable under Options other than Incentive Stock Options
shall be equal to at least the Fair Market Value on the date of grant unless the
discount below Fair Market Value is expressly granted by the Committee in lieu
of an otherwise payable amount of salary or cash bonus.
(ii) Notwithstanding the provisions of Section 6(b), except as
provided in Section 9(v) (iv) and (v) below, the Restriction Period of an Award
of Restricted Stock shall be at least three years unless the restriction is
performance-based, in which event the Restriction Period shall be at least one
year.
(iii) Notwithstanding the last sentence of Section 9(a) or the
first sentence of Section 10, except as provided in Section 9(v) (v) below, the
Committee may substitute new Options for previously granted Options having
higher exercise prices or amend the exercise price of outstanding options to
lower such exercise price only where such substitutions or amendments would,
when aggregated with all Awards that do not satisfy the specific limitations of
this Section 9(v) (i) and (ii), cover not more than 5% of the shares of Stock
reserved for issuance under the Plan. Such substitutions or amendments shall be
initiated only to fulfill a legitimate corporate purpose (such as, without
limitation, retention of a key employee) and then only in order to maintain
option value when due to extreme circumstances beyond management's control.
(iv) Notwithstanding the foregoing, the Administrator may
grant Awards that do not satisfy the specific limitations of this Section 9(v)
(i) and (ii) so long as such Awards, in aggregate with Awards described in
Section 9(v) (iii), do not cover more than 5% of the shares of Stock reserved
for issuance under this Plan.
(v) Notwithstanding the foregoing, the provisions of this
Section 9(v) do not apply to the first 4,950,000 shares reserved for issuance
under this Plan.
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SECTION 10. AMENDMENTS AND TERMINATION.
The Board may amend, alter or discontinue the Plan or any Award
(subject to the provisions of Section 9(v) (iii)), but no amendment, alteration
or discontinuance shall be made which would impair the rights of a participant
under an outstanding Award without the participant's consent. In addition, to
the extent required for the Plan to comply with Rule 16b-3 or, with respect to
provisions solely as they relate to Incentive Stock Options, to the extent
required for the Plan to comply with Section 422 of the Code, the Board may not
amend or alter the Plan without the approval of a majority of the votes cast at
a duly held stockholders' meeting at which a quorum of the voting power of the
Company is represented in person or by proxy, where such amendment or alteration
would:
(a) except as expressly provided in the Plan, increase the total number
of shares reserved for issuance pursuant to Awards under the Plan;
(b) except as expressly provided in the Plan, change the minimum price
terms of Section 5(b)(iii);
(c) change the class of employees and consultants eligible to
participate in the Plan;
(d) extend the maximum Option period under Section 5(b)(i); or
(e) materially increase the benefits accruing to participants under the
Plan.
SECTION 11. EFFECTIVE DATE OF PLAN.
The Plan shall be effective on the date it is adopted by the Board but
all Awards shall be conditioned upon approval of the Plan at a duly held
stockholders' meeting by the affirmative vote of the holders of a majority of
the voting power of the shares of the Company represented in person or by proxy
and entitled to vote at the meeting.
SECTION 12. TERM OF PLAN.
No Award shall be granted on or after October 31, 2000, but Awards
granted prior to October 31, 2000 may extend beyond that date.
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EXHIBIT 99.2
RAYCHEM CORPORATION
AMENDED AND RESTATED 1984 EMPLOYEE STOCK PURCHASE PLAN
1. Purpose
The Amended and Restated 1984 Employee Stock Purchase Plan (the "Plan")
is designed to encourage and assist employees of Raychem Corporation and
participating subsidiaries (together, the "Company") to acquire an equity
interest in the Company through the purchase of shares of Common Stock.
2. Administration
(a) The Plan shall be administered by the Board of Directors except to
the extent the Board of Directors, by resolution, delegates administration of
the Plan to a committee of the Board. The Board of Directors or the committee to
which the Board of Directors delegates administration hereunder, in either case,
are hereinafter referred to as the "Board."
(b) The Corporate Benefits Committee, or such other committee or
persons as the Board may from time to time select (the "Administrator"), shall
be responsible for such matters as the Board shall determine from time to time.
Subject to the express provisions of the Plan, to the overall supervision of the
Board, and to the limitations of Section 423 or any successor provision of the
Internal Revenue Code of 1986, as amended (the "Code"), the Administrator may
administer and interpret the Plan in any manner it believes to be desirable and
any such interpretation shall be conclusive and binding on the Company and all
participants.
3. Shares Subject to Plan
(a) Number of Shares. The Company has reserved for sale under the Plan
16,000,000 shares of Common Stock, less any shares sold under either the Plan,
the Amended and Restated Raychem Limited Employee Stock Purchase Plan or the
Amended and Restated 1985 Supplemental Employee Stock Purchase Plan. Shares sold
under the Plan may be newly issued shares or shares reacquired in private
transactions or open market purchases, but all shares sold under the Plan
regardless of source shall be counted against the 16,000,000 share limitation.
(b) Adjustments. In the event of any reorganization, recapitalization,
stock split, reverse stock split, stock dividend, combination of shares, merger,
consolidation, offering of rights, or other similar change in the capital
structure of the Company, the Administrator may make such adjustment, if any, as
it deems appropriate in the number, kind, and purchase price of the shares
available for purchase under the Plan and in the maximum number of shares
subject to any option under the Plan.
4. Eligibility Requirements
Each employee, except those described in the next paragraph, shall
become eligible to participate in the Plan in accordance with Section 5 on the
first Enrollment Date (as herein defined) following employment by the Company.
Participation in the Plan is entirely voluntary.
The following employees are not eligible to participate in the Plan:
(i) employees who would, immediately upon enrollment in the
Plan, own directly or indirectly, or hold options or rights to acquire,
an aggregate of 5% or more of the total combined voting power or value
of all outstanding shares of all classes of the Company or any
subsidiary;
(ii) employees who are customarily employed by the Company
less than 15 hours per week or less than five months in any calendar
year; and
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(iii) employees who are prohibited by the laws of the nation
of their residence or employment from participating in the Plan.
"Employee" shall mean any individual who performs services for Raychem
Corporation or a participating subsidiary pursuant to an employment relationship
described in Treasury Regulations Section 31.3401(c)-1 or any successor
provision. "Subsidiary" shall mean any corporation in an unbroken chain of
corporations beginning with Raychem Corporation if, as of the applicable
Enrollment Date, each of the corporations other than the last corporation in the
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in the chain.
"Participating Subsidiary" shall mean a Subsidiary which has been designated by
the Administrator as covered by the Plan.
5. Participation
Enrollment. Any eligible employee may enroll or re-enroll in
the Plan as of the first trading day of any February, May, August and November,
or as of such other specific trading days established by the Administrator from
time to time (each an "Enrollment Date"). In order to enroll an eligible
employee must complete, sign, and submit to the Company an enrollment form. An
enrollment form must be received by the Company before the date established by
the Administrator from time to time (each a "Cut-Off Date"); provided, however,
that in no event shall a Cut-Off Date be more than 60 days before an Enrollment
Date. An enrollment form that is received before a CutOff Date shall be
effective on the Enrollment Date to which such Cut-Off Date relates.
6. Options to Purchase Common Stock
(a) Grant of Options. Enrollment by a participant in the Plan on an
Enrollment Date will constitute the grant by the Company to the participant of
options to purchase shares of Common Stock under the Plan. The number of options
granted will equal the number of percentage points of salary the participant
elects to have withheld. Re-enrollment by a participant in the Plan will
constitute cancellation by the participant of one or more outstanding options
and the grant by the Company to the participant of new options (equal in number
to the number of options canceled) on the Enrollment Date on which re-enrollment
occurs. An increase (but not a decrease) in the level of payroll withholding
also constitutes the grant of new options for the incremental change in the
percentage withheld but does not cancel outstanding options. Any participant
whose options expire and who has not withdrawn from the Plan will automatically
be re-enrolled in the Plan and granted new options (equal in number to the
number of expiring options) on the Enrollment Date immediately following the
Purchase Date on which the participant's then current options expire. Any date
on which a participant is granted options under the Plan is referred to as a
"Grant Date."
(b) Terms and Conditions of Options. Each option granted under the Plan
shall have the following terms:
(i) whether or not all shares of Common Stock have been
purchased thereunder, the option will expire on the earliest to occur
of (A) the completion of the purchase of shares on the last Purchase
Date occurring within 12 months of the Grant Date for such option, or
such shorter option period as may be established by the Board from time
to time prior to an Enrollment Date for all options to be granted on
such Enrollment Date, or (B) the date on which participation of such
participant in the Plan terminates for any reason;
(ii) payment for shares purchased under the option will be
made only through payroll withholding in accordance with Section 7;
(iii) purchase of shares upon exercise of the option will be
accomplished only in installments in accordance with Section 8;
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(iv) the price per share under the option will be determined
as provided in Section 8;
(v) unless otherwise determined by the Administrator, the
number of shares available for purchase under each option shall be
equal to the number of shares determined by dividing $3333 1/3 by the
fair market value of a share determined at the Grant Date of such
option;
(vi) notwithstanding clause (v), no option (taken together
with all other options then outstanding under this Plan and under all
other similar stock purchase plans of the Raychem Corporation or any
Subsidiary) shall in any event give the participant the right to
purchase shares at a rate which accrues in excess of $25,000 of fair
market value of such shares determined at the applicable Grant Dates in
any calendar year during which such participant is enrolled in the Plan
at any time; and
(vii) the option will in all respects be subject to the terms
and conditions of the Plan, as interpreted by the Administrator from
time to time.
7. Payroll Withholding
(a) Withholding Elections. Each participant may elect to make
contributions at a rate equal to any whole percentage up to a maximum of 15%, or
such other maximum percentage as the Board may establish from time to time
before an Enrollment Date for all options to be granted on such Enrollment Date,
of his or her monthly base earnings from the Company (excluding bonuses,
overtime pay, shift premiums, long term disability or workers' compensation
payments and similar amounts, but including elective qualified contributions by
the participant to employee benefit plans). The rate of contribution shall be
designated by the participant in the enrollment form. A participant may elect to
increase or decrease the rate of contribution effective as of any Enrollment
Date by delivery to the Company not later than the related Cut-Off Date of a new
enrollment form indicating the revised rate of contribution. An increase (but
not a decrease) in the contribution rate constitutes the grant of new options.
If the rate is decreased and there is more than one option outstanding, the
participant may specify the option to which such decrease should apply.
(b) Use of Funds. Contributions shall be credited to a participant's
account as soon as administratively feasible after payroll withholding. The
Company shall be entitled to use of the contributions immediately after payroll
withholding and shall have no obligation to pay interest on the contributions to
any participant.
8. Purchase of Shares
(a) Purchase Procedures. On the last trading day of each January,
April, July and October, or on such other specific trading days as may be
established by the Administrator from time to time prior to an Enrollment Date
for all options to be granted on such Enrollment Date (each a "Purchase Date"),
the Company shall apply the funds then credited to each participant's account to
the purchase of whole and fractional shares of Common Stock. The cost to the
participant for the shares purchased under any option shall be 85% of the lower
of:
(i) the closing price of Common Stock on the New York Stock
Exchange composite transactions tape on the Grant Date for such option;
or
(ii) the closing price of Common Stock on the New York Stock
Exchange composite transactions tape on that Purchase Date.
Any cash equal to less than the price of the smallest fractional share of Common
Stock which may be purchased under the Plan left in a participant's payroll
deduction account on a Purchase Date shall be carried forward in such
participant's account for application on the next Purchase Date.
The Administrator may in the case of participants employed by
participating subsidiaries provide for Common Stock to be sold through the
relevant Participating Subsidiaries to such participants, to the extent
consistent with Section 423 of the Code.
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(b) Certificates Evidencing Common Stock. At the election of the
participant, certificates evidencing shares purchased on any Purchase Date shall
be delivered as soon as administratively feasible or a notation of
noncertificated shares shall be made on the stock records of the Company, but,
in either case, participants shall be treated as the owners of their shares
effective as of the Purchase Date.
9. Withdrawal From the Plan
A participant may withdraw from the Plan in full (but not in part) at
any time. All funds credited to a participant's payroll deduction account shall
be distributed to him or her without interest as soon as administratively
feasible after notice of withdrawal is received by the Company. An employee who
has withdrawn may not return funds to the Company and require the Company to
apply those funds to the purchase of shares. Any eligible employee who has
withdrawn from the Plan may, however, enroll in the Plan again on any subsequent
Enrollment Date in accordance with the provisions of Section 5.
10. Termination of Employment
Participation in the Plan terminates immediately when a participant
ceases to be employed by the Company for any reason whatsoever (including death
or disability) or otherwise becomes ineligible to participate in the Plan. As
soon as administratively feasible after termination, the Company shall pay to
the participant or his or her beneficiary or legal representative all amounts
credited to the participant's payroll deduction account.
11. Leave of Absence
Unless a participant has voluntarily withdrawn from the Plan, shares
will be purchased for that participant's account on the Purchase Date next
following commencement of a leave of absence by such participant. Participation
in the Plan will terminate immediately after the purchase of shares on such
Purchase Date, however, unless:
(i) the leave of absence is of less than 90 days' duration and
is due to illness, injury or other reason approved by the
Administrator; or
(ii) the participant's right to reemployment after such leave
is guaranteed by contract or statute.
12. Designation of Beneficiary
Each participant may designate one or more beneficiaries in the event
of death and may, in his or her sole discretion, change such designation at any
time. Any such designation shall be effective upon receipt by the Company and
shall control over any disposition by will or otherwise.
As soon as administratively feasible after the death of a participant,
fractional shares will be sold and the cash proceeds along with a certificate
representing whole shares credited to his or her account shall be delivered to
the designated beneficiaries or, in the absence of a designation, to the
executor, administrator or other legal representative of the participant's
estate. Such delivery shall relieve the Company of further liability with
respect to the Plan on account of the deceased participant. If more than one
beneficiary is designated, each beneficiary shall receive an equal portion of
the account unless the participant has given express contrary instructions.
13. Assignment
The rights of a participant under the Plan shall not be assignable by
such participant, by operation of law, or otherwise. No participant may create a
lien on any funds, securities, rights or other property held by the Company for
the account of the participant under the Plan, except to the extent that there
has been a designation of beneficiaries in accordance with the Plan, and except
to the extent permitted by the laws of descent and distribution if beneficiaries
have not been designated.
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A participant's right to purchase shares under the Plan shall be
exercisable only during the participant's lifetime and only by him or her,
except that a participant may direct the Company in the enrollment form to issue
share certificates to the participant jointly with one or more other persons
with right of survivorship, or to certain forms of trusts approved by the
Administrator.
14. Administrative Assistance
The Administrator may, in its sole discretion, retain a brokerage firm,
bank, or other financial institution to assist in the purchase of shares,
delivery of reports, or other administrative aspects of the Plan. If the
Administrator so elects, each participant shall (unless prohibited by the laws
of the nation of his or her employment or residence) be deemed upon enrollment
in the Plan to have authorized the establishment of an account on his or her
behalf at such institution. Shares purchased by a participant under the Plan
shall be held in the account in the participant's name, or if the participant so
indicates in the enrollment form, in the participant's name together with the
name of one or more other persons, in joint tenancy with right of survivorship
or spousal community property, or in certain forms of trusts approved by the
Administrator.
15. Costs
All costs and expenses incurred in administering the Plan shall be paid
by the Company, except that (i) the Company may impose a transaction fee on each
sale of shares made by a participant through the Company and (ii) any stamp
duties or transfer taxes applicable to participation in the Plan may be charged
to a participant's account. Any brokerage fees for the purchase of shares by a
participant shall be paid by the Company, but brokerage and/or bank fees for the
resale of shares by a participant shall be borne by the participant.
16. Reports
The Company shall provide or cause to be provided to each participant a
report of his or her contributions and the shares purchased by that participant
on each Purchase Date.
17. Equal Rights and Privileges
All eligible employees shall have equal rights and privileges with
respect to the Plan so that the Plan qualifies as an "employee stock purchase
plan" within the meaning of Section 423 or any successor provision of the Code
and the related regulations. Any provision of the Plan which is inconsistent
with Section 423 or any successor provision of the Code shall without further
act or amendment by the Company or the Board be reformed to comply with the
requirements of Section 423. This Section 17 shall take precedence over all
other provisions in the Plan.
18. Applicable Law
The Plan shall be governed by the substantive laws (excluding the
conflict of laws rules) of the State of California.
19. Modification and Termination
The Board may amend, alter or terminate the Plan at any time. No
amendment shall be effective without the approval of a majority of the votes
cast at a duly held stockholders' meeting at which a quorum of the voting power
of the Company is represented in person or by proxy, if such amendment would:
(i) increase the number of shares reserved for purchase under
the Plan;
(ii) materially increase the benefits to participants; or
(iii) materially modify the requirements for participation.
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The Board may elect to terminate any or all outstanding options at any
time. In the event the Plan is terminated, the Board may also elect either to
terminate outstanding options upon completion of the purchase of shares on the
next Purchase Date, or to permit options to expire in accordance with their
terms (and participation to continue through such expiration dates). If the
options are terminated prior to expiration, all funds contributed to the Plan
that have not been used to purchase shares shall be returned to the participants
as soon as administratively feasible.
If at any time the shares available under the Plan are over-enrolled,
enrollments shall be reduced proportionately to eliminate the over-enrollment.
Any funds that cannot be applied to the purchase of shares due to
over-enrollment shall be refunded to participants as soon as administratively
feasible.
20. Board and Stockholder Approval
This Plan was approved by the Board of Directors on August 3, 1984 and
by the holders of a majority of the voting power of all outstanding shares of
the Company on October 1, 1984. Amendments to this Plan were approved by the
Board of Directors on August 9, 1985, January 24, 1986, August 8, 1986, August
3, 1990, August 2, 1991, May 8, 1992, August 20, 1993, August 12, 1994, June 7,
1995, August 16, 1996 and October 4, 1996 and by the stockholders of the Company
on October 14, 1985, November 11, 1986, October 31, 1990, October 30, 1991,
October 28, 1992, October 27, 1993, November 9, 1994, November 1, 1995 and
November 1, 1996.
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EXHIBIT 99.3
RAYCHEM CORPORATION
AMENDED AND RESTATED 1985 SUPPLEMENTAL EMPLOYEE
STOCK PURCHASE PLAN
1. Purpose
The Amended and Restated 1985 Supplemental Employee Stock Purchase Plan
(the "Plan") is designed to encourage and assist employees of participating
subsidiaries (the "Participating Subsidiaries") of Raychem Corporation (the
"Company") to acquire an equity interest in the Company through the purchase of
shares of Common Stock of the Company. The terms and conditions of purchase are
designed to be substantially the same in economic substance as the terms for
employees of the Company under the Amended and Restated 1984 Employee Stock
Purchase Plan (the "1984 Plan") but may vary as to procedures for purchase as
desirable or necessary to reflect the tax, employment, securities, foreign
exchange or other applicable laws and regulations in effect from time to time in
the nations in which the Participating Subsidiaries are located.
2. Administration
(a) The Plan shall be administered by the Board of Directors of the
Company unless and until such time as the Board of Directors delegates
administration to a committee pursuant to Section 2(b).
(b) The Board of Directors, by resolution, may delegate administration
of the Plan to a committee of the Board. The Board of Directors or the committee
to which the Board of Directors delegates administration hereunder, in either
case, are hereafter referred to as the "Board."
(c) The Corporate Benefits Committee, or such other committee or
persons as the Board may from time to time select (the "Administrator") shall be
responsible for the matters set forth herein and for such additional matters as
the Board shall determine from time to time. At the time that the Plan is
adopted by a Participating Subsidiary, the Administrator, after consultation
with the management of the Participating Subsidiary and local legal and
financial advisors, where required, shall publish supplemental rules for
administration of the Plan (the "Rules") for that Participating Subsidiary. The
Rules shall specify purchase procedures under the Plan for that Participating
Subsidiary so as to comply with the tax, employment, securities, foreign
exchange or other applicable laws of the nation where the Participating
Subsidiary is located without materially affecting the economic substance of the
Plan with respect to the Company or participants.
(d) The Administrator shall have the power, subject to, and within the
limits of, the express provisions of the Plan and the overall supervision of the
Board:
(1) To construe and interpret the Plan and to establish,
amend, and revoke the Rules. The Administrator, in the exercise of this
power, shall generally determine all questions of policy and expediency
that may arise and may correct any defect, omission, or inconsistency
in the Plan or the Rules in a manner and to the extent it shall deem
necessary or expedient to make the Plan fully effective.
(2) To prescribe the terms and provisions of participation by
eligible employees which shall be identical for all employees of each
Participating Subsidiary but may vary among Participating Subsidiaries
to the extent deemed necessary or desirable by the Administrator;
provided, however, that in no event shall such variation materially
alter the economic substance of the Plan with respect to the Company or
participants.
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(3) To designate from time to time which subsidiaries shall
become Participating Subsidiaries.
(4) To provide for Common Stock to be sold through the
Participating Subsidiaries to participants, if the Administrator in its
discretion so elects.
(5) To retain a brokerage firm, bank or other financial
institution to act as trustee, depository, pledgeholder, escrowholder,
or in such other capacity as specified by the Administrator to assist
in the purchase and sale of shares, delivery of reports, holding or
delivery of funds or share certificates or other administrative aspects
of the Plan, and to make such provision for currency translation as the
Administrator deems appropriate.
(6) To establish a mechanism to enable the participants to
purchase shares with U.S. dollars should exchange control regulations,
or any other law or regulation be enacted which in any way limits or
restricts the purchase of Common Stock by participants through
limitations on transfer of funds into or out of the country in which
the Participating Subsidiaries are located.
(7) To specify the method of designation of funds to be
applied to the purchase of shares which may include, without
limitation, payroll withholding, payment in full in cash upon purchase,
loans from the Company or Participating Subsidiary with appropriate
escrow and repurchase agreements, or any other arrangement not
inconsistent with the Plan which the Administrator in its discretion
may approve.
(8) To exercise such powers and to perform such acts as are
deemed generally necessary or expedient to promote the best interests
of the Company or any Participating Subsidiary, and to enable the
general purpose of the Plan, as expressed in Section 1, to be
accomplished.
3. Shares Subject to Plan
(a) Number of Shares. The Company has reserved for sale under the Plan
16,000,000 shares of Common Stock, less any shares sold under either the 1984
Plan, the Amended and Restated Raychem Limited Employee Stock Purchase Plan, or
the Plan. Shares sold under the Plan may be newly issued shares or shares
reacquired in private transactions or open market purchases, but all shares sold
under the Plan regardless of source shall be counted against the 16,000,000
share limitation.
(b) Adjustments. In the event of any reorganization, recapitalization,
stock split, reverse stock split, stock dividend, combination of shares, merger,
consolidation, offering of rights or other similar change in the capital
structure of the Company, the Administrator may make such adjustment, if any, as
it deems appropriate in the number, kind and purchase price of the shares
available for purchase under the Plan and in the maximum number of shares
subject to any grant under the Plan.
4. Eligibility Requirements
Each employee of a Participating Subsidiary, except those described in
the next paragraph, shall be eligible to participate in the Plan. Participation
in the Plan is entirely voluntary.
The following employees are not eligible to participate in the Plan:
(a) employees who would, immediately upon enrollment in the
Plan, own directly or indirectly, or hold options or rights to acquire, an
aggregate of 5% or more of the total combined voting power or value of all
outstanding shares of all classes of the Company or any Subsidiary;
(b) employees who are customarily employed for less than five
months in any calendar year or less than 15 hours per week; and
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(c) employees who are prohibited by the laws of the nation of
their residence or employment from participating in the Plan.
"Employee" shall mean any individual who performs services for
a Participating Subsidiary and is deemed to be an employee under the laws of the
country in which such Subsidiary is located.
"Subsidiary" shall mean any company whose financial statements
are consolidated with those of the Company.
5. Participation
(a) Enrollment. Any eligible employee may enroll or re-enroll
in the Plan as of such specific trading days as are established from time to
time ("Enrollment Dates"). The Administrator may require eligible employees to
complete, sign and submit to the Company an enrollment form in order to enroll
or re-enroll in the Plan and may establish deadlines prior to the Enrollment
Dates by which such enrollment forms must be received so as to effect enrollment
on such Enrollment Date. Enrollment or re-enrollment by a participant in the
Plan on an Enrollment Date will constitute the one or more grants by the Company
to the participant of the right to apply funds to the purchase of shares of
Common Stock from the Company under the Plan, in accordance with Section 6.
(b) Special Rule. A participant in the 1984 Plan ("1984 Plan
Participant") whose employment is transferred without material interruption to a
Participating Subsidiary may (if such transfer terminates his or her
participation in the 1984 Plan) enroll in the Plan within ten business days
following the beginning of his or her employment by the Participating
Subsidiary. Unless otherwise elected by the 1984 Plan Participant or determined
by the Administrator at the time of such enrollment, the Grant Date of the 1984
Plan Participant for purposes of the Plan for such enrollment will be considered
to be the 1984 Plan Participant's most recent date of enrollment in the 1984
Plan, and the percentage of compensation being withheld under the 1984 Plan
shall be the percentage used to determine the 1984 Plan Participant's Designed
Funds pursuant to Section 6(b) of the Plan.
6. Purchase
(a) Designated Funds. Each participant may elect to purchase shares
with designated funds in an amount equal to any whole percentage, up to 15
percent (or such other maximum percentage as the Board may specify for the Plan
and the 1984 Plan), of such participant's base pay (the "Designated Funds").
(b) Grant of Right to Apply Designated Funds. Enrollment or
re-enrollment by a participant in the Plan on an Enrollment Date will constitute
the grant by the Company to the participant of the right to apply Designated
Funds to the purchase of shares of Common Stock from the Company under the Plan.
The number of grants granted on any such Enrollment Date will be equal to the
number of percentage points of Designated Funds specified by the participant.
Any date on which a participant is granted the right to apply Designated Funds
to the purchase of shares of Common Stock under the Plan is referred to as a
"Grant Date."
(c) Terms and Conditions of Rights to Apply Designated Funds. For each
grant made under the Plan the Administrator must set forth in the Rules the
following terms (and, in its discretion, may set forth in the Rules any
additional terms of grant not inconsistent with the terms below):
(1) the expiration date of the grant shall be the earlier to
occur of (A) the completion of the purchase of shares within 12 months
of the applicable Grant Date, (or such shorter period as the Board may
establish) or (B) the date on which participation of such participant
in the Plan terminates for any reason;
(2) the per share price which shall be paid in U.S. dollars
and shall be 85% of the lower of:
(A) the closing price of Common Stock reported by the
New York Stock Exchange on the applicable Grant Date; or
(B) the closing price of Common Stock reported by the
New York Stock Exchange
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on the Delivery Date; and
(3) unless otherwise determined by the Administrator, the
number of shares available for purchase under each grant shall be
determined by dividing $3333-1/3 by the fair market value of a share of
Common Stock determined at the Grant Date of such grant for each 1% of
Designated Funds;
(4) notwithstanding clause (3), the grant (taken together with
all other grants then outstanding under this Plan and under all other similar
stock purchase plans of the Company or any subsidiary) will in no event give the
participant the right to purchase shares at a rate which accrues in excess of
U.S. $25,000 of fair market value of such shares determined at the applicable
Grant Dates in any calendar year during which such participant is enrolled in
the Plan at any time.
(d) Delivery Dates. On such specific trading days as may be
established by the Administrator from time to time prior to an Enrollment Date
for all enrollments or re-enrollments made on such Enrollment Date ("Delivery
Dates"), the Company shall apply the equivalent in U.S. dollars of the
Designated Funds of each participant to whole and fractional shares of Common
Stock.
7. Withdrawal from the Plan
A participant may withdraw from the Plan in full (but not in
part) at any time. All Designated Funds not applied or to be applied to the
purchase of shares under the Plan by such participant shall be distributed to
such participant without interest as soon as administratively feasible after
notice of withdrawal is received by the Company. Any eligible employee who has
withdrawn from the Plan may enroll in the Plan again on any subsequent
Enrollment Date in accordance with the provisions of Section 5.
8. Termination of Employment
(a) Except as provided in Section 8(b) below, participation in
the Plan ceases immediately when the employment of a participant by a
Participating Subsidiary terminates (such that after employment termination such
participant is not employed by any Participating Subsidiary) for any reason
whatsoever, including death or disability, or when such participant otherwise
becomes ineligible to participate in the Plan. As soon as administratively
feasible after termination, the Company shall pay to the participant or his or
her beneficiary or legal representative all Designated Funds of such participant
not applied or to be applied to the purchase of shares under the Plan.
(b) Following transfer of a participant's employment without
material interruption from a Participating Subsidiary to the Company or any
subsidiary that is a participant in the 1984 Plan, any outstanding grant to the
participant under the Plan shall not terminate until the last occurrence of the
earliest of: (i) the end of the last Delivery Date included in the term of the
grant, (ii) enrollment of the participant in the 1984 Plan, (iii) any event or
change of condition or status (other than the transfer described in this Section
8(b)) that would have caused the grant to terminate if the transfer of
employment described in this Section 8(b) had not occurred. While a grant
remains outstanding pursuant to this Section 8(b), the Company or other
subsidiary to which the participant is transferred shall effect payroll
withholdings pursuant to the grant and shall remit them to the Participating
Subsidiary that employed the Participant at the time of the transfer; such
withholdings shall be treated by the Participating Subsidiary as Designated
Funds of the participant at the time withheld by the Company or other
subsidiary. Notwithstanding the provisions of Section 6 relating to the
designation and application of Designated Funds, following approval by the
Company and the Participating Subsidiary, the participant may, in lieu of
payroll withholding, pay a corresponding amount to the Participating Subsidiary
if such amount is received on or before the relevant Delivery Date.
9. Leave of Absence
Unless a participant has voluntarily withdrawn from the Plan,
Designated Funds will be applied to the purchase of shares on the Delivery Date
next following commencement of a leave of absence by such participant.
Participation in the Plan will terminate immediately after the application of
funds on such Delivery Date, however,
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unless:
(a) the leave of absence is of less than 90 days duration and
is due to illness, injury or other reason approved by the Administrator; or
(b) the participant's right to reemployment after such leave
is guaranteed by contract or statute.
10. Costs
All costs and expenses incurred in administering the Plan shall be paid
by the Participating Subsidiary, except that (i) the Company may impose a
transaction fee on each sale of shares made by a participant through the Company
and (ii) any stamp duties or transfer taxes applicable to participation in the
Plan may be charged to the account of such participant. Any brokerage fees for
the purchase of shares by a participant shall be paid by the Company, but
brokerage and/or bank fees for the resale of shares by a participant shall be
borne by the participant.
11. Reports
The Company shall provide or cause to be provided to each participant a
report of his or her Designated Funds and the application of such Designated
Funds on each Delivery Date.
12. Modification and Termination
(a) Modification. The Board may amend, alter or terminate the Plan at
any time. No amendment shall be effective without the approval of a majority of
the votes cast at a duly held stockholders' meeting at which a quorum of the
voting power of the Company is represented in person or by proxy if such
amendment would:
(i) increase the number of shares reserved for purchase under
the Plan;
(ii) materially increase the benefits to participants; or
(iii) materially modify the requirements for participation.
(b) Termination. The Board may elect to terminate any or all
outstanding options at any time. In the event the Plan is terminated, the Board
may also elect to either terminate outstanding grants upon completion of the
application of Designated Funds on the next Delivery Date, or to permit grants
to expire in accordance with their terms (and participation to continue through
such expiration dates). If the grants are terminated prior to expiration, all
Designated Funds that have not been and will not be applied to the purchase of
shares shall be returned to the participants as soon as administratively
feasible.
If at any time the shares available under the Plan are overenrolled,
enrollments shall be reduced proportionately to eliminate the overenrollment.
Any Designated Funds that cannot be applied to the purchase of shares due to
overenrollment shall be refunded to participants as soon as administratively
feasible.
13. Effective Date; Approvals
(a) Effective Date. The Plan shall be effective with respect to each
Participating Subsidiary on the date specified by the Administrator for such
Participating Subsidiary.
(b) Approvals. This Plan was approved by the Board of Directors on
August 9, 1985 and by the holders of a majority of the voting power of all
outstanding shares of the Company on October 14, 1985. Amendments to this Plan
were approved by the Board of Directors on August 8, 1986, August 3, 1990,
August 2, 1991, May 8, 1992, August 20, 1993, August 12, 1994, June 7, 1995,
August 16, 1996 and October 4, 1996 and by the stockholders of the Company on
November 11, 1986, October 31, 1990, October 30, 1991, October 28, 1992, October
27, 1993, November 9, 1994, November 1, 1995 and November 1, 1996.
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EXHIBIT 99.4
RAYCHEM CORPORATION
1996 DIRECTORS STOCK OPTION PLAN
1. Purpose.
The purpose of the 1996 Directors Stock Option Plan
(the "Plan") of Raychem Corporation (the "Company") is to supplement the cash
compensation of nonemployee members of the Company's Board of Directors (the
"Board") and to provide a means for such directors to increase their holdings of
Company stock.
2. Definitions.
The following definitions shall apply to this Plan:
(a) "Annual Grant Date" shall mean, for each calendar
year, the date on which the stockholders of the Company have their regular
annual meeting.
(b) "Board" shall mean the Board of Directors of the
Company.
(c) "Committee" shall mean the Committee referred to
in Section 3(a), or the Board in its capacity as administrator of the Plan in
accordance with Section 3.
(d) "Eligible Director" shall mean any person who is
a member of the Board and who is not a full or part-time employee of the Company
or of any subsidiary or affiliate of the Company.
(e) "Grant Date" shall mean the Initial Grant Date or
the Annual Grant Date, as appropriate.
(f) "Initial Grant Date" shall mean (i) in the case
of an Eligible Director who was not an employee of the Company immediately prior
to the date such person became an Eligible Director, the date such Eligible
Director is first elected as a member of the Board, or (ii) in the case of an
Eligible Director who was an employee of the Company immediately prior to the
date such person became an Eligible Director, the date such Eligible Director
resigned as an employee of the Company.
(g) "Option" shall mean an option to purchase Shares
granted under this Plan.
(h) "Option Agreement" shall mean the written
agreement described in Section 6.
(i) "Shares" shall mean shares of common stock of the
Company.
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3. Administration.
(a) General. This Plan shall be administered by the
Board or, upon delegation by the Board, by a committee of the Board.
(b) Powers of Committee. The Committee shall have
full and complete authority to adopt such rules and regulations and to make all
such other determinations not inconsistent with the Plan as may be necessary for
the administration of the Plan.
4. Shares Subject to Plan.
(a) Aggregate Number. Subject to adjustment in
accordance with Section 6(h), an aggregate of 200,000 Shares is reserved for
issuance under this Plan. Shares sold under this Plan may be unissued Shares or
reacquired Shares, but all Shares issued under the Plan, regardless of source,
shall be counted against the 200,000-Share limitation.
(b) Rights as Stockholder. An Eligible Director shall
have no rights as a stockholder with respect to Shares acquired by exercise of
an option until the issuance (as evidenced by the appropriate entry on the books
of the Company or a duly authorized transfer agent) of a stock certificate
evidencing the Shares. Subject to Section 6(h), no adjustment shall be made for
dividends or other events for which the record date is prior to the date the
certificate is issued.
5. Nondiscretionary Grants.
(a) Initial Grants. On the Initial Grant Date, each
Eligible Director shall receive the grant of an Option to purchase 5,000 Shares.
(b) Regular Annual Grants. On each Annual Grant Date,
immediately after the annual election of directors, each Eligible Director then
in office shall receive the grant of an Option to purchase 1,250 Shares.
(c) One Time Grant. On November 1, 1996, each
Eligible Director then in office shall receive the grant of an Option to
purchase 2,000 Shares.
(d) Adjustment. The number of Shares for which
Options are granted in accordance with this Section 5 and the number of Shares
subject to any option shall be subject to adjustment in accordance with Section
6(h).
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6. Terms of Option Agreements.
Upon the grant of each Option, the Company and the
Eligible Director shall enter into an Option Agreement which shall specify the
Grant Date and the exercise price, and shall include or incorporate by reference
the substance of all of the following provisions and such other provisions
consistent with this Plan as the Board may determine:
(a) Term. The term of the Option shall be ten years
from its Grant Date, subject to earlier termination in accordance with Sections
6(f) or 6(i).
(b) Exercise Schedule. The Option shall be
exercisable on the following schedule: Beginning on the first anniversary of the
Grant Date, for up to 25% of the Shares covered by the option; beginning on the
second anniversary of the Grant Date, for up to 50% of such Shares; beginning on
the third anniversary of the Grant Date, for up to 75% of such Shares; and
beginning on the fourth anniversary of the Grant Date, and, thereafter until the
earlier of expiration of the Option's term or termination of the Option in
accordance with Section 6(g) or 6(i), for up to 100% of such Shares.
Notwithstanding the foregoing, an Option held by an Eligible Director shall
become immediately exercisable in full upon the death or disability of such
Eligible Director, upon retirement of such Eligible Director from the Board, or
upon an unsuccessful attempt by such Eligible Director to win reelection to the
Board, or upon the adoption by the Company of a plan for a liquidation,
dissolution, merger, consolidation or reorganization as described in clause (x),
(y) or (z) of Section 6(i).
(c) Purchase Price. The purchase price of the Shares
subject to each Option shall be the closing sales price for Shares as reported
by the Wall Street Journal, New York Stock Exchange Composite Transactions, on
the Grant Date of such Option, or on the last preceding business day if such
Grant Date is not a business day.
(d) Payment of Purchase Price. The purchase price of
Shares acquired pursuant to an Option shall be paid in full at the time the
Option is exercised in cash or by delivery of any property other than cash
(including Shares, or other securities of the Company), so long as such property
constitutes valid consideration for the Shares purchased under applicable law
and is surrendered in good form for transfer, or by some combination of cash and
such property; provided, however, that Options may not be exercised by the
delivery of Shares more frequently than at six-month intervals. Exercise of an
Option may also be made pursuant to a "cashless exercise/sale" procedure
pursuant to which funds to pay for exercise of the Option are delivered to the
issuer by a broker upon receipt of stock certificates from the issuer, or
pursuant to which participants obtain margin loans from brokers to fund the
exercise of the Option.
(e) Tax Withholding. A participant may make an
election to have the Shares to be obtained upon exercise of the Option withheld
by the Company on behalf of the participant, to pay the amount of tax that the
Committee, in its discretion, determines to be required to be withheld by the
Company.
Any Shares tendered to or withheld by the Company shall be valued at
Fair Market Value on such date. The value of the Shares tendered or withheld may
not exceed the required federal, state, local and foreign withholding tax
obligations as computed by the Company.
The participant shall pay to the Company in cash or by delivery of any
valid consideration other than cash (including Shares, or other securities of
the Company), promptly when the amount of such obligations becomes determinable,
all applicable federal, state, local and foreign withholding taxes that the
Committee, in its discretion, determines to result upon exercise of an
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Option or from a transfer or other disposition of Shares upon exercise of an
Option or otherwise related to the Option or Shares acquired in connection with
an Option.
(f) Transferability. Except as approved by the Board,
no Option shall be transferable otherwise than by will or the laws of descent
and distribution, and, an Option shall be exercisable during the Eligible
Director's lifetime only by the Eligible Director.
(g) Termination of Membership on the Board. Except in
the case of death, disability, retirement from the Board, or an unsuccessful
attempt to win reelection to the Board, if an Eligible Director's membership on
the Board terminates for any reason, an Option held at the date of termination
(but only to the extent exercisable at the time of such termination in
accordance with Section 6(b)) may be exercised in whole or in part at any time
within one year after the date of such termination (but in no event after the
term of the Option expires) and shall thereafter terminate. If an Eligible
Director's membership terminates because of death, disability, retirement from
the Board, or an unsuccessful attempt to win reelection to the Board, an Option
held at the date of such termination may be exercised for up to 100% of the
Shares covered by such Options at any time within one year after the date of
such termination (but in no event after the term of the Option expires) and
shall thereafter terminate.
(h) Capitalization Changes. If any change is made in
the Shares subject to the Plan or subject to any Option granted under the Plan,
through merger, consolidation, reorganization, recapitalization, stock dividend,
dividend in property other than cash, stock split, liquidating dividend,
combination of shares, exchange of shares, change in corporate structure or
otherwise, the Committee shall make appropriate adjustments as to the maximum
number of Shares subject to the Plan, the number of Shares covered by any Option
Grant, the maximum number of Shares for which Options may be granted to any
Eligible Director, and the number of Shares and price per Share covered by
outstanding Options.
(i) Change of Ownership. In the event of (x) a
dissolution or liquidation of the Company, (y) a merger or consolidation in
which the Company is not the surviving corporation, or (z) any other capital
reorganization in which more than 50% of the shares of the Company entitled to
vote are exchanged, the Company shall give to the Eligible Director, at the time
of adoption of the plan for liquidation, dissolution, merger, consolidation or
reorganization, either (i) a reasonable time thereafter within which to exercise
the Option prior to the effectiveness of such liquidation, dissolution, merger,
consolidation or reorganization, at the end of which time the Option shall
terminate, or (ii) the right to exercise the Option as to an equivalent number
of shares of stock of the corporation succeeding the Company or acquiring its
business by reason of such liquidation, dissolution, merger, consolidation or
reorganization.
7. Use of Proceeds.
Proceeds from the sale of Shares pursuant to this
Plan shall be used by the Company for general corporate purposes.
8. Legal Requirements.
The Company shall not be obligated to offer or sell
any Shares except in compliance with all applicable federal and state securities
laws and any rules and regulations thereunder. Any certificates representing
shares purchased upon exercise of an Option shall bear appropriate legends.
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9. Amendment of Plan.
The Board may amend the Plan at any time, provided,
however, that any amendment that increases the number of shares as to which
Options may be granted or reduces the exercise price below the price provided in
the Plan shall be subject to the approval of the Company's stockholders. No
other amendment shall require stockholder approval except to the extent (a)
required by applicable laws, regulations or rules or (b) the Board otherwise
concludes that stockholder approval is advisable. No amendment shall affect the
rights of the holder of any Option, except with that holder's consent.
10. Termination or Suspension of Plan.
The Board at any time may suspend or terminate this
Plan. This Plan, unless sooner terminated, shall terminate on the tenth
anniversary of its adoption by the Board. No Option may be granted under this
Plan while this Plan is suspended or after it is terminated. Suspension or
termination of this Plan shall not affect the rights of the holder of any
Option, except with that holder's consent.
11. Stockholder Approval.
This Plan is subject to approval at the annual
meeting of stockholders on November 1, 1996, by the affirmative vote of the
holders of a majority of the voting power of the shares of the Company
represented in person or by proxy and entitled to vote at the meeting.
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