<PAGE>
As filed with the Securities and Exchange Commission on August 13, 1998
File No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------
SECURITY CAPITAL GROUP INCORPORATED
(Exact name of registrant as specified in its charter)
MARYLAND 36-3692698
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
125 Lincoln Avenue 87501
Santa Fe, New Mexico (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code:
(505) 982-9292
SECURITY CAPITAL GROUP INCORPORATED
1998 LONG-TERM INCENTIVE PLAN
(Full title of the plan)
Jeffrey A. Klopf
Secretary
125 Lincoln Avenue
Santa Fe, New Mexico 87501
(505) 982-9292
(Agent for Service)
-----------------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=======================================================================================================
Proposed Proposed
Amount to be Maximum Maximum
Title of Securities to be Registered Offering Price Aggregate Amount of
Registered Shares Per Share(1) Offering Price(1) Registration Fee
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class B Common Stock, par
value $.01 per share
(including related preferred
share purchase rights) 12,257,733 $22.40625 $274,649,830.03 $81,021.70
=======================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee on the
basis of the average of the and low prices for the high shares of Class B
Common Stock as reported on the New York Stock Exchange on August 12, 1998.
================================================================================
<PAGE>
Part II
INFORMATION REQUIRED IN
THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, which have heretofore been filed Security Capital Group
Incorporated ("Security Capital" or "Registrant") with the Securities and
Exchange Commission (the "SEC") are incorporated by reference herein and shall
be deemed to be a part hereof:
(a) Form 10-K for the year ended December 31, 1997 (File No. 1-13355);
(b) Form 10-Q for the quarter ended March 31, 1998 (File No. 1-13355); and
(c) The description of Security Capital's shares of Class B Common Stock
(including the related preferred share purchase rights) contained in
the Security Capital's registration statement on Form 8-A filed with
the SEC on September 11, 1997 (File No. 1-13355).
All documents subsequently filed by Security Capital pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated herein by
reference and shall be deemed a part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the issuance of the shares of Class B Common Stock registered
hereunder is being passed upon for Security Capital by the law firm of Mayer,
Brown & Platt, Chicago, Illinois. Mayer, Brown & Platt has represented and is
currently representing Security Capital and certain of its affiliates.
ITEM 6. INDEMNIFICATION OF TRUSTEES AND OFFICERS.
Article EIGHTH of the Registrant's Charter provides as follows with respect to
the indemnification of directors and officers of the Registrant:
"The Corporation shall have the power, to the maximum extent permitted by
Maryland law in effect from time to time, to obligate itself to indemnify
and to pay or reimburse reasonable expenses in advance of final disposition
of a proceeding to (a) any individual who is a present or former director
of officer of the Corporation or (b) any individual who, while a director
or officer of the Corporation and at the request of the Corporation, serves
or has served as a director, officer, partner or trustee of another
corporation, partnership, joint venture, trust, employee benefit plan or
any other enterprise from and against any claim or liability to which such
person may become subject or which such person may incur by reason of his
or her status as a present or former director or officer of the
Corporation. The Corporation shall have the power, with the approval of
the Board of Directors, to provide such indemnification and advancement of
II-1
<PAGE>
expenses to a person who served a predecessor of the Corporation in any of
the capacities described in (a) or (b) above and to any employee or agent
of the Corporation or a predecessor of the Corporation."
Article NINTH of the Registrant's Charter provides as follows with respect to
limitation of liability of its directors and officers:
"To the maximum extent that Maryland law in effect from time to time
permits limitation of the liability of directors and officers of a Maryland
corporation, no director or officer of the Corporation shall be liable to
the Corporation or its stockholders for money damages. Neither the
amendment nor repeal of this Article NINTH nor the adoption or amendment of
any other provision of the Charter or Bylaws of the Corporation
inconsistent with this Article NINTH, shall apply to or affect in any
respect the applicability of the preceding sentence with respect to any act
or failure to act which occurred prior to such amendment, repeal or
adoption."
Article XIII of the Registrant's Bylaws provides as follows with respect to
limitation of liability of its directors and officers and advances for expenses:
"To the maximum extent permitted by Maryland law in effect from time to
time, the Corporation shall indemnify and, without requiring a preliminary
determination of the ultimate entitlement to indemnification shall pay or
reimburse reasonable expenses in advance of final disposition of a
proceeding to (a) any individual who is a present or former director or
officer of the Corporation and who is made a party to the proceeding by
reasons of his service in that capacity or (b) any individual who, while a
director of the Corporation and at the request of the Corporation, serves
or has served another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise and who is made a party to the
proceeding by reason of his or her service in that capacity. The
Corporation may, with the approval of the Board of Directors, provide such
indemnification and advance for expenses to a person who served a
predecessor of the Corporation in any of the capacities described in (a) or
(b) above and to any employee or agent of the Corporation or a predecessor
of the Corporation.
Neither the amendment nor repeal of this Article, nor the adoption or
amendment of any other provision of the Bylaws or Charter of the
Corporation inconsistent with this Article, shall apply to or affect in any
respect the applicability of the preceding paragraph with respect to any
act or failure to act which occurred prior to such amendment, repeal or
adoption."
Maryland law permits a Maryland corporation to include in its charter a
provision limiting the liability of its directors and officers to the
corporation and its stockholders for money damages except for liability
resulting from (a) actual receipt of an improper benefit or profit in money,
property or services or (b) active and deliberate dishonesty established by a
final judgment as being material to the cause of action. The Charter contains
such a provision which limits such liability to the maximum extent permitted by
Maryland law.
Maryland law requires a corporation (unless its charter requires otherwise,
which the Charter does not) to indemnify a director or officer who has been
successful, on the merits or otherwise, in the defense of any proceeding to
which he or she is made a party by reason of his or her service in that
capacity. Maryland law permits a corporation to indemnify its present and
former directors and officers, among others, against judgments, penalties,
fines, settlements and reasonable expenses actually incurred by them in
connection with any proceeding to which they may be made a party by reason of
their service in those or other capacities unless it is established that (a) the
act or omission of the director or officer was material to the matter giving
rise to the proceeding and (i) was committed in bad faith or (ii) was the result
of active and deliberate dishonesty, (b) the director or officer actually
received an improper personal benefit in money, property or services or (c) in
the case of any criminal proceeding, the director or officer had reasonable
cause to believe that the act or omission was unlawful. However, a Maryland
corporation may not indemnify for an adverse judgment in a suit by or in the
right of the corporation or for a
II-2
<PAGE>
judgment of liability on the basis that personal benefit was improperly
received, unless in either case a court orders indemnification and then only for
expenses. In addition, Maryland law permits a corporation to advance reasonable
expenses to a director or officer upon the corporation's receipt of (a) a
written affirmation by the director or officer of his or her good faith belief
that he or she has met the standard of conduct necessary for indemnification by
the corporation and (b) a written statement by or in his or her behalf to repay
the amount paid or reimbursed by the corporation if it shall ultimately be
determined that the standard of conduct was not met.
The Registrant has entered into indemnity agreements with each of its officers
and directors which provide for reimbursement of all expenses and liabilities of
such officer or director, arising out of any lawsuit or claim against such
officer or director due to the fact that he was or is serving as an officer or
director, except for such liabilities and expenses (a) the payment of which is
judicially determined to be unlawful, (b) relating to claims under Section 16(b)
of the Securities Exchange Act of 1934, or (c) relating to judicially determined
criminal violations.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See Index to Exhibits.
ITEM 9. UNDERTAKINGS.
A. Rule 415 Offering.
-----------------
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events 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 registration statement is on Form S-3 or
Form S-8, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to section
13 or section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
II-3
<PAGE>
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
B. Filings Incorporating Subsequent Exchange Act Documents by Reference.
--------------------------------------------------------------------
The undersigned registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to section 13(a) or section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Exchange Act) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Indemnification of Directors and Officers.
-----------------------------------------
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions of the registrant's charter or by-laws or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-4
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned directors and
officers of Security Capital Group Incorporated, hereby constitutes and appoints
William D. Sanders, C. Ronald Blankenship, Paul E. Szurek, Jeffrey A. Klopf and
Mark Pearson, his true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, with full power to act alone, to sign any and all
amendments (including post-effective amendments) to this registration statement,
and to file the same, with all exhibits thereto, and any and all 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 any and all acts and things requisite and necessary to be done in
and about the premises, as fully and to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or any of them, or his substitute or nominee, may lawfully do
or cause to be done by virtue hereof.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Santa Fe, State of New Mexico, on August 13, 1998.
SECURITY CAPITAL GROUP INCORPORATED
By /s/ Jeffrey A. Klopf
-----------------------------------
Jeffrey A. Klopf
Senior Vice President and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ William D. Sanders Chairman of the Board of Directors, August 13, 1998
- --------------------------- President and Chief Executive Officer
William D. Sanders (principal executive officer) and
Director
/s/ Paul E. Szurek Chief Financial Officer August 13, 1998
- --------------------------- (principal financial officer)
Paul E. Szurek
/s/ James C. Swaim Vice President August 13, 1998
- --------------------------- (principal accounting officer)
James C. Swaim
/s/ Samuel W. Bodman Director August 13, 1998
- ---------------------------
Samuel W. Bodman
/s/ Hermann Buerger Director August 13, 1998
- ---------------------------
Hermann Buerger
/s/ John P. Frazee, Jr. Director August 13, 1998
- ---------------------------
John P. Frazee, Jr.
/s/ Cyrus F. Freidheim, Jr. Director August 13, 1998
- ---------------------------
Cyrus F. Freidheim, Jr.
/s/ H. Laurance Fuller Director August 13, 1998
- ---------------------------
H. Laurance Fuller
Director
- ---------------------------
Ray L. Hunt
/s/ John T. Kelley III Director August 13, 1998
- ---------------------------
John T. Kelley III
/s/ Peter S. Willmott Director August 13, 1998
- ---------------------------
Peter S. Willmott
</TABLE>
II-6
<PAGE>
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
Exhibit
Number Description of Document
- ------ -----------------------
<S> <C>
4.1 Articles of Amendment and Restatement (incorporated by reference to
Exhibit 4.1 to Security Capital's Registration Statement on Form S-11
(File No. 333-26037)(the "Form S-11"))
4.2 Amended and Restated Bylaws (incorporated by reference to Exhibit 4.2
to the Form S-11)
4.3 Form of Rights Agreement between Security Capital and The First
National Bank of Boston, as Rights Agent, including form of Rights
Certificate (incorporated by reference to Exhibit 4.3 to the Form
S-11)
4.4 Form of stock certificate for shares of Class B Common Stock
(incorporated by reference to Exhibit 4.5 to the Form S-11)
4.5 Form of 6.5% Convertible Subordinated Debentures due 2016
(incorporated by reference to Exhibit 4.7 to the Form S-11)
4.6 Security Capital 1998 Long-Term Incentive Plan
5 Opinion of Mayer, Brown & Platt
15.1 Letter of Arthur Andersen LLP regarding unaudited interim financial
information
23.1 Consent of Mayer, Brown & Platt (included in its opinion filed as
Exhibit 5 hereto)
23.2 Consent of Arthur Andersen LLP
23.3 Consent of KPMG Peat Marwick LLP
23.4 Consent of Price Waterhouse SARL
23.5 Consent of Ernst & Young LLP
23.6 Consent of Ernst & Young LLP
24 Power of Attorney (included on page II-5)
</TABLE>
II-7
<PAGE>
Exhibit 4.6
SECURITY CAPITAL GROUP INCORPORATED
1998 LONG-TERM INCENTIVE PLAN
-----------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
<S> <C>
SECTION 1................................................ 1
GENERAL ............................................ 1
1.1. Purpose..................................... 1
1.2. Participation............................... 1
SECTION 2................................................ 2
OPTIONS............................................. 2
2.1. Definition.................................. 2
2.2. Eligibility................................. 2
2.3. Price....................................... 2
2.4. Exercise.................................... 3
2.5. Post-Exercise Limitations................... 4
2.6. Expiration Date............................. 4
SECTION 3................................................ 6
SHARE AWARDS........................................ 6
3.1. Definition.................................. 6
3.2. Eligibility................................. 6
3.3. Terms and Conditions of Awards.............. 6
SECTION 4................................................ 7
OPERATION AND ADMINISTRATION........................ 7
4.1. Effective Date.............................. 7
4.2. Shares Subject to Plan...................... 7
4.3. Individual Limits on Awards................. 8
4.4. Adjustments to Shares....................... 8
4.5. Change in Control........................... 11
4.6. Limit on Distribution....................... 13
4.7. Liability for Cash Payments................. 13
4.8. Performance-Based Compensation.............. 13
4.9. Withholding................................. 14
4.10. Transferability............................. 14
4.11. Notices..................................... 14
4.12. Form and Time of Elections.................. 15
4.13. Agreement With Company...................... 15
4.14. Limitation of Implied Rights................ 15
4.15. Evidence.................................... 16
4.16. Action by Company or Related Company........ 16
4.17. Gender and Number........................... 16
4.18. Applicable Law.............................. 16
4.19. Foreign Employees........................... 16
SECTION 5................................................ 16
COMMITTEE........................................... 16
5.1. Administration.............................. 16
5.2. Selection of Committee...................... 16
5.3. Powers of Committee......................... 17
5.4. Delegation by Committee..................... 18
5.5. Information to be Furnished to Committee.... 18
5.6. Liability and Indemnification of Committee.. 18
SECTION 6................................................ 18
AMENDMENT AND TERMINATION........................... 18
</TABLE>
<PAGE>
SECURITY CAPITAL GROUP INCORPORATED
1998 LONG-TERM INCENTIVE PLAN
-----------------------------
SECTION 1
----------
GENERAL
--------
1.1. Purpose. The Security Capital Group Incorporated 1998 Long-Term
Incentive Plan (the "Plan") has been established by Security Capital Group
Incorporated (the "Company") to:
(a) attract and retain employees and other persons providing services to
the Company and the Related Companies (as defined below);
(b) motivate Participants (as defined in subsection 1.2), by means of
appropriate incentives, to achieve long-range goals;
(c) provide incentive compensation opportunities that are competitive with
those of other corporations; and
(d) further identify Participants' interests with those of the Company's
other stockholders through compensation that is based on the value of
the Company's common shares;
and thereby promote the long-term financial interest of the Company and the
Related Companies, including the growth in value of the Company's equity and
enhancement of long-term stockholder return. The term "Related Company" means
any company during any period in which it is a "subsidiary corporation" (as that
term is defined in section 424(f) of the Internal Revenue Code of 1986, as
amended (the "Code")), with respect to the Company or any affiliate of the
Company which is designated as a Related Company by the Committee.
1.2. Participation. Subject to the terms and conditions of the Plan, the
Committee (as described in Section 5) shall determine and designate, from time
to time, from among the Eligible Individuals (as defined below), those persons
who will be granted one or more awards under Sections 2 or 3 of the Plan (an
"Award"), and thereby become "Participants" in the Plan. In the discretion of
the Committee, and subject to the terms of the Plan, a Participant may be
granted any Award permitted under the provisions of the Plan, and more than one
Award may be granted to a Participant. Except as otherwise agreed by the
Company and the Participant, or except as otherwise provided in the Plan, an
Award under the Plan shall not affect any previous Award under
<PAGE>
the Plan or an award under any other plan maintained by the Company or the
Related Companies. For purposes of the Plan, the term "Eligible Individual"
shall mean any employee of the Company or a Related Company or other person
providing services thereto; provided, however, that a member of the Board of
Directors of the Company (the "Board") who is not an employee of the Company or
a Related Company shall not be an "Eligible Individual".
SECTION 2
---------
OPTIONS
-------
2.1. Definitions. The grant of an "Option" under this Section 2 entitles
the Participant to purchase shares of Class B common stock of the Company
("Shares") at a price fixed at the time the Option is granted, subject to the
terms of this Section. Options granted under this Section may be either
Incentive Stock Options or Non-Qualified Stock Options, as determined in the
discretion of the Committee. An "Incentive Stock Option" is an Option that is
intended to satisfy the requirements applicable to an "incentive stock option"
described in section 422 of the Code. A "Non-Qualified Stock Option" is an
Option that is not intended to be an Incentive Stock Option.
2.2. Eligibility. The Committee shall designate the Participants to whom
Options are to be granted under this Section and shall determine the number of
Shares subject to each such Option. If the Committee grants Incentive Stock
Options, to the extent that the aggregate fair market value of Shares with
respect to which Incentive Stock Options are exercisable for the first time by
any individual during any calendar year (under all plans of the Company and all
related companies within the meaning of section 424(f) of the Code) exceeds
$100,000, such options shall be treated as Non-Qualified Stock Options, to the
extent required by section 422 of the Code.
2.3. Price. The determination and payment of the purchase price of a
Share under each Option granted under this Section shall be subject to the
following:
(a) The purchase price shall be established by the Committee at the time
the Option is granted; provided, however, that in no event shall such
price be less than the greater of the Fair Market Value (defined
below) of a Share on the date the Option is granted or the par value
of a Share.
(b) Subject to the following provisions of this subsection, the full
purchase price of each Share purchased upon the exercise of any Option
shall be paid at the time of
2
<PAGE>
such exercise (or such later date as may be permitted by the Committee
in the case of a cashless exercise) and, as soon as practicable
thereafter (subject to an election under subsection 2.4), a
certificate representing the Shares so purchased shall be delivered to
the person entitled thereto.
(c) The purchase price shall be payable in cash or by tendering Shares by
actual delivery or attestation (valued at Fair Market Value as of the
day of exercise) that have been held by the Participant at least six
months, or in any combination thereof, as determined by the Committee.
(d) The "Fair Market Value" of a Share as of any date shall be determined
in accordance with the following rules:
(i) If the Shares are at the time listed or admitted to trading on
any stock exchange, then the Fair Market Value shall be the
closing price per Share on such date on the principal exchange on
which the Shares are then listed or admitted to trading or, if no
such sale is reported on that date, on the last preceding date on
which a sale was so reported.
(ii) If the Shares are not at the time listed or admitted to trading
on a stock exchange, the Fair Market Value shall be the average
of the closing reported bid and asked prices regular way of the
Shares on the date in question in the over-the-counter market, as
such prices are reported in a publication of general circulation
selected by the Committee and regularly reporting the market
price of Shares in such market.
(iii) If the Shares are not listed or admitted to trading on any stock
exchange or traded in the over-the-counter market, the Fair
Market Value shall be as determined by the Committee in good
faith.
(iv) For purposes of determining the Fair Market Value of Shares that
are sold pursuant to a cashless exercise program, Fair Market
Value shall be the price at which such Shares are sold.
2.4. Exercise. Except as otherwise expressly provided in the Plan, an
Option granted under this Section shall be exercisable in accordance with the
following terms of this subsection:
3
<PAGE>
(a) The terms and conditions relating to exercise of an Option shall be
established by the Committee, and may include, without limitation,
conditions relating to completion of a specified period of service
(subject to paragraph (b) below), achievement of performance standards
prior to exercise of the Option or the achievement of Share ownership
objectives by the Participant. The Committee, in its sole discretion,
may accelerate the vesting of any Option under circumstances
designated by it at the time the Option is granted or thereafter.
(b) No Option may be exercised by a Participant after the Expiration Date
(as defined in subsection 2.6) applicable to that Option.
(c) Prior to the date the Shares would otherwise be transferred pursuant
to the exercise of an Option, to the extent permitted by the
Committee, a Participant may irrevocably elect to defer receipt of
such Shares until the last date of a later calendar year, but in no
event later than the Participant's Date of Termination (as defined in
subsection 2.6), provided, that if the Date of Termination of a
Participant who is a member of a select group of management or a
highly compensated employee within the meaning of section 401(a)(1) of
the Employee Retirement Income Security Act of 1974, as amended,
occurs by reason of Retirement (as defined in subsection 2.6), the
Participant may elect to defer receipt for a period up to the last day
of the calendar year in which occurs the fifteenth anniversary of the
Participant's Retirement. Any such deferral election shall be made in
such form and at such times as the Committee may determine and shall
be subject to such other terms, conditions and limitations as the
Committee may establish, provided, however, any election to defer
payment beyond a Participant's Retirement which has not been on file
at least 12 months prior to the Participant's Retirement shall be
disregarded.
2.5. Post-Exercise Limitations. The Committee, in its discretion, may
impose such restrictions on Shares acquired pursuant to the exercise of an
Option as it determines to be desirable, including, without limitation,
restrictions relating to disposition of the shares and forfeiture restrictions
based on service, performance, Share ownership by the Participant and such other
factors as the Committee determines to be appropriate.
2.6. Expiration Date. The "Expiration Date" with respect to an Option means
the date established as the Expiration Date by
4
<PAGE>
the Committee at the time of the grant; provided, however, that unless
determined otherwise by the Committee, the Expiration Date with respect to any
Option shall not be later than the earliest to occur of:
(a) the ten-year anniversary of the date on which the Option is granted;
(b) if the Participant's Date of Termination occurs by reason of death,
Disability or Retirement, the one-year anniversary of such Date of
Termination;
(c) if the Participant's Date of Termination occurs for reasons other than
Retirement, death, Disability or Cause, the three-month anniversary of
such Date of Termination; or
(d) if the Participant's Date of Termination occurs for reasons of Cause,
such Date of Termination.
For purposes of the Plan, a Participant's "Date of Termination" shall be the
date on which he both ceases to be an employee of the Company and the Related
Companies and ceases to perform material services for the Company and the
Related Companies, regardless of the reason for the cessation; provided that a
"Date of Termination" shall not be considered to have occurred during the period
in which the reason for the cessation of services is a leave of absence approved
by the Company or the Related Company which was the recipient of the
Participant's services. Except as otherwise provided by the Committee, a
Participant shall be considered to have a "Disability" during the period in
which he is unable, by reason of a medically determinable physical or mental
impairment, to engage in the material and substantial duties of his regular
occupation, which condition is expected to be permanent. "Retirement" of a
Participant shall mean the occurrence of a Participant's Date of Termination,
other than for Cause, death or Disability, after providing at least five years
of service to the Company or the Related Companies and attaining age 60. For
purposes of the Plan, "Cause" shall mean, in the reasonable judgment of the
Committee (i) the willful and continued failure by the Participant to
substantially perform his duties with the Company or any Related Company after
written notification by the Company or Related Company, (ii) the willful
engaging by the Participant in conduct which is demonstrably injurious to the
Company or any Related Company, monetarily or otherwise, or (iii) the engaging
by the Participant in egregious misconduct involving serious moral turpitude.
For purposes hereof, no act, or failure to act, on the Participant's part shall
be deemed "willful" unless done, or omitted to be done, by the Participant not
in good faith and without reasonable belief
5
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that such action was in the best interest of the Company or Related Company.
SECTION 3
---------
SHARE AWARDS
-------------
3.1. Definition. Subject to the terms of this Section, a Share Award under
the Plan is a grant of Shares to a Participant, the earning, vesting or
distribution of which is subject to one or more conditions established by the
Committee, provided, that in no event will Share Awards under the Plan exceed
20% of the Shares reserved under the Plan. Such conditions may relate to events
(such as performance or continued employment) occurring before or after the date
the Share Award is granted, or the date the Shares are earned by, vested in or
delivered to the Participant. If the vesting of Share Awards is subject to
conditions occurring after the date of grant, the period beginning on the date
of grant of a Share Award and ending on the vesting or forfeiture of such Shares
(as applicable) is referred to as the "Restricted Period". To the extent that
the vesting of a Share Award is contingent on performance, the performance shall
be measured over a period of not less than one year. Share Awards may provide
for delivery of the shares of Shares at the time of grant or may provide for a
deferred delivery date. A Share Award may, but need not, be made in conjunction
with a cash-based incentive compensation program maintained by the Company and
may, but need not, be in lieu of cash otherwise awardable under such program.
3.2. Eligibility. The Committee shall designate the Participants to whom
Share Awards are to be granted and the number of Shares that are subject to each
such Award.
3.3. Terms and Conditions of Awards. Share Awards granted to Participants
under the Plan shall be subject to the following terms and conditions:
(a) Beginning on the date of grant (or, if later, the date of
distribution) of Shares comprising a Share Award, and including any
applicable Restricted Period, the Participant as owner of such Shares
shall have the right to vote such Shares.
(b) Payment of dividends, if any, with respect to Share Awards shall be
subject to the following:
(i) On and after the date that a Participant has a fully earned and
vested right to the Shares comprising a Share Award and the
Shares have been
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distributed to the Participant, the Participant shall have all
dividend rights (and other rights) of a stockholder with respect
to such Shares.
(ii) Prior to the date that a Participant has a fully earned and
vested right to the shares comprising a Share Award, the
Committee, in its sole discretion, may award Dividend Rights with
respect to such shares.
(iii) On and after the date that a Participant has a fully earned and
vested right to the Shares comprising a Share Award, but before
the Shares have been distributed to the Participant, the
Participant shall be entitled to Dividend Rights with respect to
such Shares, at the time and in the form determined by the
Committee.
(iv) A "Dividend Right" with respect to shares comprising a Share
Award shall entitle the Participant, as of each dividend payment
date, to an amount equal to the dividends payable with respect to
a Share multiplied by the number of such Shares. Dividend Rights
shall be settled in cash or in Shares valued at Fair Market Value
as of the date of settlement, as determined by the Committee,
shall be payable at the time determined by the Committee and
shall be subject to such other terms and conditions as the
Committee may determine.
SECTION 4
----------
OPERATION AND ADMINISTRATION
-----------------------------
4.1. Effective Date. The Plan shall be effective as of the date it is
approved by the Company's stockholders. The Plan shall be unlimited in duration
and, in the event of Plan termination, shall remain in effect as long as any
Awards awarded under it are outstanding and not fully vested; provided, however,
that no new Awards shall be made under the Plan on or after the tenth
anniversary of the date on which the Plan is adopted by the Board.
4.2. Shares Subject to Plan. The Shares with respect to which Awards may be
made under the Plan shall be shares currently authorized but unissued or
currently held or subsequently acquired by the Company as treasury shares,
including shares purchased in the open market or in private transactions.
Subject to the provisions of subsection 4.4, the number of Shares which
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may be issued with respect to Awards under the Plan shall not exceed 12,257,733
Shares in the aggregate. Except as otherwise provided herein, any Shares subject
to an Award which for any reason expires or is terminated without issuance of
Shares (including Shares that are not issued because Shares are tendered
pursuant to subsection 2.3(c) or 4.9) shall again be available under the Plan.
4.3. Individual Limits on Awards. Notwithstanding any other provision of
the Plan to the contrary, no Participant shall receive any Award of an Option
under the Plan to the extent that the sum of:
(a) the number of Shares subject to such Award;
(b) the number of Shares subject to all other prior Awards of Options
under the Plan during the one-year period ending on the date of the
Award; and
(c) the number of Shares subject to all other prior share options granted
to the Participant under other plans or arrangements of the Company
during the one-year period ending on the date of the Award;
would exceed the Participant's Individual Limit under the Plan. The
determination made under the foregoing provisions of this subsection shall be
based on the Shares subject to the Awards at the time of grant, regardless of
when the Awards become exercisable. Subject to the provisions of subsection 4.4,
a Participant's "Individual Limit" shall be 1,000,000 Shares.
4.4. Adjustments to Shares.
(a) If the Company shall effect any subdivision or consolidation of Shares
or other capital readjustment, payment of stock dividend, stock split,
combination of shares or recapitalization or other increase or
reduction of the number of Shares outstanding without receiving
compensation therefor in money, services or property, then the
Committee shall equitably adjust (i) the number of Shares available
under the Plan; (ii) the number of shares available under any
individual or other limits; (iii) the number of Shares subject to
outstanding Awards; and (iv) the per-share price under any outstanding
Award to the extent that the Participant is required to pay a purchase
price per Share with respect to the Award.
(b) If the Company is reorganized, merged or consolidated or is party to a
plan of exchange with another corporation, pursuant to which
reorganization, merger,
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consolidation or plan of exchange, the stockholders of the Company
receive any shares of stock or other securities or property, or the
Company shall distribute securities of another corporation to its
stockholders, there shall be substituted for the Shares subject to
outstanding Awards an appropriate number of shares of each class of
stock or amount of other securities or property which were distributed
to the stockholders of the Company in respect of such Shares, subject
to the following:
(i) If the Committee determines that the substitution described in
accordance with the foregoing provisions of this paragraph would
not be fully consistent with the purposes of the Plan or the
purposes of the outstanding Awards under the Plan, the Committee
may make such other adjustments to the Awards to the extent that
the Committee determines such adjustments are consistent with
the purposes of the Plan and of the affected Awards.
(ii) All or any of the Awards may be cancelled by the Committee on or
immediately prior to the effective date of the applicable
transaction, but only if the Committee gives reasonable advance
notice of the cancellation to each affected Participant, and
only if either: (A) the Participant is permitted to exercise all
Awards that will be cancelled (without regard to whether such
Awards would otherwise be exercisable) for a reasonable period
prior to the effective date of the cancellation; or (B) the
Participant receives payment or other benefits that the
Committee determines to be reasonable compensation for the value
of all cancelled Awards (without regard to whether such Awards
would otherwise be vested).
(iii) Upon the occurrence of a reorganization of the Company or any
other event described in this paragraph (b), any successor to
the Company shall be substituted for the Company to the extent
that the Company and the successor agree to such substitution.
(c) Upon (or, in the discretion of the Committee, immediately prior to)
the sale to (or exchange with) a third party unrelated to the Company
of all or substantially all of the assets of the Company, all Awards
shall be cancelled. If Awards are cancelled
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under this paragraph, then, with respect to any affected
Participant, either:
(i) the Participant shall be provided with reasonable advance
notice of the cancellation, and the Participant shall be
permitted to exercise all Awards that will be cancelled
(without regard to whether such Awards would otherwise be
exercisable) for a reasonable period prior to the effective
date of the cancellation; or
(ii) the Participant shall receive payment or other benefits that
the Committee determines to be reasonable compensation for
the value of all cancelled Awards (without regard to whether
such cancelled Awards would otherwise be vested).
The foregoing provisions of this paragraph shall also apply to
the sale of all or substantially all of the assets of the Company
to a related party, if the Committee determines such application
is appropriate. Notwithstanding the foregoing provisions of this
paragraph (c), in lieu of cancellation of outstanding Awards, the
Committee and the purchaser of all or substantially all of the
Company's assets may provide that an appropriate number of shares
or securities of the purchaser or its affiliates shall be
substituted for Shares with respect to outstanding Awards under
the Plan, provided that such substituted awards shall be
comparable in value and contain terms and conditions similar to
the Awards.
(d) In determining what action, if any, is necessary or appropriate
under the foregoing provisions of this subsection, the Committee
shall act in a manner that it determines to be consistent with
the purposes of the Plan and of the affected Awards and, where
applicable or otherwise appropriate, in a manner that it
determines to be necessary to preserve the benefits and potential
benefits of the affected Awards for the Participants and the
Company.
(e) The existence of this Plan and the Awards granted hereunder shall
not affect in any way the right or power of the Company or its
stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, any merger or
consolidation of the Company, any issue of bonds, debentures,
preferred or prior preference stocks ahead of or affecting the
Company's Shares or the rights
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<PAGE>
thereof, the dissolution or liquidation of the Company, any sale or
transfer of all or any part of its assets or business, or any other
corporate act or proceeding, whether of a similar character or
otherwise.
(f) Except as expressly provided by the terms of this Plan, the issue by
the Company of shares of stock of any class, or securities convertible
into shares of stock of any class, for cash or property or for labor
or services, either upon direct sale, upon the exercise of rights or
warrants to subscribe therefor or upon conversion of shares or
obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof,
shall be made with respect to Awards then outstanding hereunder.
(g) Awards under the Plan are subject to adjustment under this subsection
only during the period in which they are considered to be outstanding
under the Plan. For purposes of this subsection, an Award is
considered "outstanding" on any date if the Participant's ability to
obtain all benefits with respect to the Award is subject to limits
imposed by the Plan (including any limits imposed by the Agreement
reflecting the Award). The determination of whether an Award is
outstanding shall be made by the Committee.
4.5. Change in Control. In the event that (i) a Participant's employment is
terminated by the Company or the successor to the Company or an affiliated
entity which is his or her employer for reasons other than Cause following a
Change in Control of the Company (as defined below), or (ii) the Plan is
terminated by the Company or its successor following a Change in Control without
provision for the continuation of outstanding Awards hereunder, all Options
which have not otherwise expired shall become immediately exercisable and all
other Awards shall become fully vested. For purposes of the Plan, a "Change in
Control" means the happening of any of the following:
(a) the stockholders of the Company approve a definitive agreement to
merge the Company into or consolidate the Company with another entity,
sell or otherwise dispose of all or substantially all of its assets or
adopt a plan of liquidation, provided, however, that a Change in
Control shall not be deemed to have occurred by reason of a
transaction, or a substantially concurrent or otherwise related series
of transactions, upon the completion of which 50% or more of the
beneficial ownership of the voting power of the Company, the surviving
corporation or corporation directly or
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indirectly controlling the Company or the surviving corporation, as
the case may be, is held by the same persons (as defined below)
(although not necessarily in the same proportion) as held the
beneficial ownership of the voting power of the Company immediately
prior to the transaction or the substantially concurrent or otherwise
related series of transactions, except that upon the completion
thereof, employees or employee benefit plans of the Company may be a
new holder of such beneficial ownership; provided, further, that a
transaction with an "Affiliate" of the Company (as defined in the
Securities Exchange Act of 1934, as amended (the "Exchange Act"))
shall not be treated as a Change in Control; or
(b) the "beneficial ownership" (as defined in Rule 13d-3 under the
Exchange Act) of securities representing 50% or more of the combined
voting power of the Company is acquired, other than from the Company,
by any "person" as defined in Sections 13(d) and 14(d) of the Exchange
Act (other than by an Affiliate or any trustee or other fiduciary
holding securities under an employee benefit or other similar stock
plan of the Company); or
(c) at any time during any period of two consecutive years, individuals
who at the beginning of such period were members of the Board of
Directors of the Company cease for any reason to constitute at least a
majority thereof (unless the election, or the nomination for election
by the Company's stockholders, of each new Director was approved by a
vote of at least two-thirds of the Directors still in office at the
time of such election or nomination who were Directors at the
beginning of such period).
For purposes of this subsection, a Participant's employment shall be deemed to
be terminated by the Company or the successor to the Company or an affiliated
entity if the Participant terminates employment after (i) a substantial adverse
alteration in the nature of the Participant's status or responsibilities from
those in effect immediately prior to the Change in Control, or (ii) a material
reduction in the Participant's annual base salary and target bonus, if any, as
in effect immediately prior to the Change in Control. If, upon a Change in
Control, awards in other shares or securities are substituted for outstanding
Awards pursuant to Section 4.4, and immediately following the Change in Control
the Participant becomes employed by the entity into which the Company merged, or
the purchaser of substantially all of the assets of the Company, or a successor
to such entity or purchaser, the Participant shall not be treated as having
terminated employment for purposes of this Section 4.5 until such
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<PAGE>
time as the Participant terminates employment with the merged entity or
purchaser (or successor), as applicable.
4.6. Limit on Distribution. Distribution of Shares or other amounts under
the Plan shall be subject to the following:
(a) Notwithstanding any other provision of the Plan, the Company shall
have no liability to deliver any Shares under the Plan or make any
other distribution of benefits under the Plan unless such delivery or
distribution would comply with all applicable laws and the applicable
requirements of any securities exchange or similar entity.
(b) In the case of a Participant who is subject to Section 16(a) and 16(b)
of the Exchange Act, the Committee may, at any time, add such
conditions and limitations to any Award to such Participant, or any
feature of any such Award, as the Committee, in its sole discretion,
deems necessary or desirable to comply with Section 16(a) or 16(b) and
the rules and regulations thereunder or to obtain any exemption
therefrom.
(c) To the extent that the Plan provides for issuance of certificates to
reflect the transfer of Shares, the transfer of such Shares may be
effected on a non-certificated basis, to the extent not prohibited by
applicable law or the rules of any stock exchange.
4.7. Liability for Cash Payments. Subject to the provisions of this
Section, each Related Company shall be liable for payment of cash due under the
Plan with respect to any Participant to the extent that such benefits are
attributable to the service rendered for that Related Company by the
Participant. Any disputes relating to liability of a Related Company for cash
payments shall be resolved by the Committee.
4.8. Performance-Based Compensation. To the extent that the Committee
determines that it is necessary or desirable to conform any Awards under the
Plan with the requirements applicable to "Performance-Based Compensation", as
that term is used in Code section 162(m)(4)(C), it may, at or prior to the time
an Award is granted, take such steps and impose such restrictions with respect
to such Award as it determines to be necessary to satisfy such requirements
including, without limitation:
(a) The establishment of performance goals that must be satisfied prior to
the payment or distribution of benefits under such Awards.
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<PAGE>
(b) The submission of such Awards and performance goals to the Company's
stockholders for approval and making the receipt of benefits under
such Awards contingent on receipt of such approval.
(c) Providing that no payment or distribution be made under such Awards
unless the Committee certifies that the goals and the applicable terms
of the Plan and Agreement reflecting the Awards have been satisfied .
To the extent that the Committee determines that the foregoing requirements
relating to Performance-Based Compensation do not apply to Awards under the Plan
because the Awards constitute Options, the Committee may, at the time the Award
is granted, conform the Awards to alternative methods of satisfying the
requirements applicable to Performance-Based Compensation.
4.9. Withholding. All Awards and other payments under the Plan are subject
to withholding of all applicable taxes, which withholding obligations may be
satisfied, with the consent of the Committee, through the surrender of Shares
which the Participant already owns or to which a Participant is otherwise
entitled under the Plan; provided, however, except to the extent permitted by
the Committee, previously-owned Shares that have been held by the Participant
less than six months or Shares to which the Participant is entitled under the
Plan may only be used to satisfy the minimum tax withholding required by
applicable law.
4.10. Transferability. Awards under the Plan are not transferable except as
designated by the Participant by will or by the laws of descent and distribution
or, to the extent provided by the Committee, pursuant to a qualified domestic
relations order (within the meaning of the Code and applicable rules
thereunder). To the extent that the Participant who receives an Award under the
Plan has the right to exercise such Award, the Award may be exercised during the
lifetime of the Participant only by the Participant. Notwithstanding the
foregoing provisions of this subsection, Awards under the Plan may be
transferred to or for the benefit of the Participant's family (including,
without limitation, to a trust or partnership for the benefit of a Participant's
family), subject to such procedures as the Committee may establish. In no event
shall an Incentive Stock Option be transferable to the extent that such
transferability would violate the requirements applicable to such option under
Code section 422.
4.11. Notices. Any notice or document required to be filed with the
Committee under the Plan will be properly filed if delivered or mailed by
registered mail, postage prepaid, to the Committee, in care of the Company, at
its principal executive offices. The Committee may, by advance written notice to
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<PAGE>
affected persons, revise such notice procedure from time to time. Any notice
required under the Plan (other than a notice of election) may be waived by the
person entitled to notice.
4.12. Form and Time of Elections. Unless otherwise specified herein, each
election required or permitted to be made by any Participant or other person
entitled to benefits under the Plan, and any permitted modification or
revocation thereof, shall be in writing filed with the Committee at such times,
in such form, and subject to such restrictions and limitations, not inconsistent
with the terms of the Plan, as the Committee shall require.
4.13. Agreement With Company. At the time of an Award to a Participant
under the Plan, the Committee may require a Participant to enter into an
agreement with the Company (the "Agreement") in a form specified by the
Committee, agreeing to the terms and conditions of the Plan and to such
additional terms and conditions, not inconsistent with the Plan, as the
Committee may, in its sole discretion, prescribe.
4.14. Limitation of Implied Rights.
(a) Neither a Participant nor any other person shall, by reason of the
Plan, acquire any right in or title to any assets, funds or property
of the Company or any Related Company whatsoever, including, without
limitation, any specific funds, assets, or other property which the
Company or any Related Company, in its sole discretion, may set aside
in anticipation of a liability under the Plan. A Participant shall
have only a contractual right to the amounts, if any, payable under
the Plan, unsecured by any assets of the Company and any Related
Company. Nothing contained in the Plan shall constitute a guarantee by
the Company or any Related Company that the assets of such companies
shall be sufficient to pay any benefits to any person.
(b) The Plan does not constitute a contract of employment, and selection
as a Participant will not give any employee the right to be retained
in the employ of the Company or any Related Company, nor any right or
claim to any benefit under the Plan, unless such right or claim has
specifically accrued under the terms of the Plan. Except as otherwise
provided in the Plan, no Award under the Plan shall confer upon the
holder thereof any right as a stockholder of the Company prior to the
date on which he fulfills all service requirements and other
conditions for receipt of such rights and Shares are registered in his
name.
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<PAGE>
4.15. Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the person acting on
it considers pertinent and reliable, and signed, made or presented by the proper
party or parties.
4.16. Action by Company or Related Company. Any action required or
permitted to be taken by the Company or any Related Company shall be by
resolution of its board of directors or trustees, as applicable, or by action of
one or more members of the board (including a committee of the board) who are
duly authorized to act for the board or (except to the extent prohibited by
applicable law or the rules of any stock exchange) by a duly authorized officer
of the Company.
4.17. Gender and Number. Where the context admits, words in any gender
shall include any other gender, words in the singular shall include the plural
and the plural shall include the singular.
4.18. Applicable Law. The provisions of the Plan shall be construed in
accordance with the laws of the State of Maryland, without giving effect to
choice of law principles.
4.19. Foreign Employees. Notwithstanding any other provision of the Plan to
the contrary, the Committee may grant Awards to eligible persons who are foreign
nationals on such terms and conditions different from those specified in the
Plan as may, in the judgment of the Committee, be necessary or desirable to
foster and promote achievement of the purposes of the Plan. In furtherance of
such purposes, the Committee may make such modifications, amendments, procedures
and subplans as may be necessary or advisable to comply with provisions of laws
in other countries or jurisdictions in which the Company or a Related Company
operates or has employees.
SECTION 5
COMMITTEE
5.1. Administration. The authority to control and manage the operation and
administration of the Plan shall be vested in a committee (the "Committee") in
accordance with this Section 5.
5.2. Selection of Committee. So long as the Company is subject to section
16 of the Exchange Act, the Committee shall be selected by the Board and shall
consist of not fewer than two members of the Board or such greater number as may
be required for compliance with Rule 16b-3 issued under the Exchange Act, none
of whom shall be eligible to receive Awards under the Plan.
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5.3. Powers of Committee. The authority to manage and control the
operation and administration of the Plan shall be vested in the Committee,
subject to the following:
(a) Subject to the provisions of the Plan, the Committee will have the
authority and discretion to select individuals to receive Awards, to
determine the time or times of receipt, to determine the types of
Awards and the number of Shares covered by the Awards, to establish
the terms, conditions, performance criteria, restrictions, and other
provisions of such Awards, and to cancel or suspend Awards. In making
such Award determinations, the Committee may take into account the
nature of services rendered by the respective employee, the
individual's present and potential contribution to the Company's
success and such other factors as the Committee deems relevant.
(b) Subject to the provisions of the Plan, the Committee will have the
authority and discretion to determine the extent to which Awards under
the Plan will be structured to conform to the requirements applicable
to Performance-Based Compensation, and to take such action, establish
such procedures, and impose such restrictions at the time such Awards
are granted as the Committee determines to be necessary or appropriate
to conform to such requirements.
(c) The Committee will have the authority and discretion to interpret the
Plan, to establish, amend and rescind any rules and regulations
relating to the Plan, to determine the terms and provisions of any
agreements made pursuant to the Plan and to make all other
determinations that may be necessary or advisable for the
administration of the Plan.
(d) Any interpretation of the Plan by the Committee and any decision made
by it under the Plan is final and binding on all persons.
(e) Except as otherwise expressly provided in the Plan, where the
Committee is authorized to make a determination with respect to any
Award, such determination shall be made at the time the Award is made,
except that the Committee may reserve the authority to have such
determination made by the Committee in the future (but only if such
reservation is made at the time the Award is granted and is expressly
stated in the Agreement reflecting the Award).
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5.4. Delegation by Committee. Except to the extent prohibited by
applicable law or the rules of any stock exchange or NASDAQ (if appropriate),
the Committee may allocate all or any portion of its responsibilities and powers
to any one or more of its members and may delegate all or any part of its
responsibilities and powers to any person or persons selected by it. Any such
allocation or delegation may be revoked by the Committee at any time.
5.5. Information to be Furnished to Committee. The Company and Related
Companies shall furnish the Committee such data and information as may be
required for it to discharge its duties. The records of the Company and Related
Companies as to an employee's or Participant's employment (or other provision of
services), termination of employment (or cessation of the provision of
services), leave of absence, reemployment and compensation shall be conclusive
on all persons unless determined to be incorrect. Participants and other persons
entitled to benefits under the Plan must furnish the Committee such evidence,
data or information as the Committee considers desirable to carry out the terms
of the Plan.
5.6. Liability and Indemnification of Committee. No member or authorized
delegate of the Committee shall be liable to any person for any action taken or
omitted in connection with the administration of the Plan unless attributable to
his own fraud or willful misconduct; nor shall the Company or any Related
Company be liable to any person for any such action unless attributable to fraud
or willful misconduct on the part of a Director or employee of the Company or
Related Company. The Committee, the individual members thereof, and persons
acting as the authorized delegates of the Committee under the Plan, shall be
indemnified by the Company against any and all liabilities, losses, costs and
expenses (including legal fees and expenses) of whatsoever kind and nature which
may be imposed on, incurred by or asserted against the Committee or its members
or authorized delegates by reason of the performance of a Committee function if
the Committee or its members or authorized delegates did not act dishonestly or
in willful violation of the law or regulation under which such liability, loss,
cost or expense arises. This indemnification shall not duplicate but may
supplement any coverage available under any applicable insurance.
SECTION 6
AMENDMENT AND TERMINATION
Subject to obtaining such approvals as may be required under the Code,
Federal securities law, Maryland corporate law or stock exchange requirements,
the Board may, at any time, amend or
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terminate the Plan, provided that, subject to subsection 4.4 (relating to
certain adjustments to shares), no amendment or termination may materially
adversely affect the rights of any Participant or beneficiary under any Award
made under the Plan prior to the date such amendment is adopted by the Board.
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Exhibit 5
August 13, 1998
Security Capital Group Incorporated
125 Lincoln Avenue
Santa Fe, New Mexico 87501
Re: Registration Statement on Form S-8
1998 Long-Term Incentive Plan
Ladies and Gentlemen:
We have acted as counsel to Security Capital Group Incorporated, a
Maryland corporation ("Security Capital" or the "Company"), in connection with
the proceedings (the "Company Proceedings") taken and to be taken relating to
the registration by Security Capital of an aggregate of 12,257,733 of its shares
of Class B Common Stock, par value $.01 per share (the "Class B Shares"), with
the Securities and Exchange Commission (the "SEC") in connection with the
Company's 1998 Long-Term Incentive Plan (the "Plan"). We have also participated
in the preparation and filing with the SEC under the Securities Act of 1933, as
amended, of a registration statement on Form S-8 (the "Registration Statement")
relating to the Class B Shares to be issued pursuant to the Plan.
As counsel to Security Capital, we have examined originals or copies
certified to our satisfaction of the Company's Articles of Amendment and
Restatement and Amended and Restated Bylaws, resolution of the Board of
Directors and such other Company records, instruments, certificates and
documents and such questions of law as we considered necessary or appropriate to
enable us to express this opinion. As to certain facts material to our opinion,
we have relied, to the extent we deem such reliance proper, upon certificates of
public officials and officers of Security Capital. In rendering this opinion,
we have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity to authentic original
documents of photostatic copies.
Based upon and subject to the foregoing and to the assumptions,
limitations and conditions set forth herein, we are of the opinion that, upon
completion of the Company Proceedings, the Class B Shares will have been validly
issued and delivered in accordance with the Company Proceedings and the Plan,
the Class B Shares will be validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
MAYER, BROWN & PLATT
<PAGE>
EXHIBIT 15.1
August 12, 1998
Board of Directors and Shareholders of
Security Capital Group Incorporated:
We are aware that Security Capital Group Incorporated has incorporated by
reference in its Registration Statement on Form S-8, relating to the Security
Capital Group Incorporated 1998 Long-Term Incentive Plan, its Form 10-Q for the
quarter ended March 31, 1998, which includes our report dated May 12, 1998
covering the unaudited interim financial information contained therein. Pursuant
to Regulation C of the Securities Act of 1933 (the "Act"), that report is not
considered a part of such registration statement or a report prepared or
certified by our firm within the meaning of Sections 7 and 11 of the Act.
Very Truly Yours,
ARTHUR ANDERSEN LLP
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement on Form S-8 of our Security Capital
Group Incorporated report dated March 18, 1998, our ProLogis Trust (formerly
known as Security Capital Industrial Trust) reports dated March 13, 1998 and to
all references to our Firm included in or made a part of this registration
statement.
ARTHUR ANDERSEN LLP
Chicago, Illinois
August 12, 1998
<PAGE>
EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
The Board of Directors of
Security Capital Group Incorporated:
We consent to the incorporation by reference in this registration statement on
Form S-8 of Security Capital Group Incorporated related to the Security Capital
Group Incorporated 1998 Long-Term Incentive Plan of our report dated January 31,
1998, except as to Note 13 which is as of March 6, 1998, relating to the balance
sheets of Security Capital Pacific Trust as of December 31, 1997 and 1996, the
related statements of earnings, shareholders' equity, and cash flows for each of
the years in the three-year period ended December 31, 1998, and the related
schedule as of December 31, 1997, which are incorporated by reference in this
registration statement.
KPMG Peat Marwick LLP
Chicago, Illinois
August 12, 1998
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EXHIBIT 23.4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the use in the Registration Statement on Form S-8 filed by
Security Capital Group Incorporated, in connection with the Security Capital
Group Incorporated 1998 Long-Term Incentive Plan, of our reports dated February
28, 1997 and February 25, 1998 relating to the consolidated financial statements
of Security Capital U.S. Realty, which reports are incorporated by reference in
such registration statement.
Price Waterhouse SARL
24-26 Avenue de la Liberte
L-1014 Luxembourg
August 12, 1998
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Exhibit 23.5
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration
Statement (Form S-8) pertaining to the Security Capital Group Incorporated 1998
Long-Term Incentive Plan of our report dated February 3, 1997, with respect to
the financial statements at December 31, 1996 and 1995 and for each of the three
years in the period ended December 31, 1996 of Security Capital Atlantic
Incorporated, which is included in the Annual Report (Form 10-K) of Security
Capital Group Incorporated for the year ended December 31, 1997 filed with the
Securities and Exchange Commission.
Ernst & Young LLP
Dallas, Texas
August 10, 1998
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Exhibit 23.6
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Security Capital Group Incorporated 1998 Long-Term
Incentive Plan of our report dated February 24, 1997, with respect to the
financial statements at December 31, 1996 and for the year ended December 31,
1996 of Homestead Village Incorporated, which is included in the Annual Report
(Form 10-K) of Security Capital Group Incorporated for the year ended December
31, 1997 filed with the Securities and Exchange Commission.
Ernst & Young LLP
Dallas Texas
August 10, 1998
