As filed with the Securities and Exchange Commission on October
2, 1998
Registration No. 33-
================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM S-8
REGISTRATION STATEMENT
Under the
SECURITIES ACT OF 1933
______________________
STATE STREET CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
MASSACHUSETTS 04-2456637
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
225 Franklin Street, Boston, Massachusetts 02110
(Address of Principal Executive Offices) (Zip Code)
STATE STREET GLOBAL ADVISORS
EQUITY COMPENSATION PLAN
(Full Title of the Plan)
MAUREEN SCANNELL BATEMAN, ESQ.
Executive Vice President and General Counsel
State Street Corporation
225 Franklin Street, Boston, Massachusetts 02110
(Name and Address of Agent For Service)
(617)786-3000
(Telephone Number, Including Area Code, of Agent For Service)
Copy to:
ROBERT F. HAYES, ESQ.
Ropes & Gray
One International Place
Boston, Massachusetts 02110
(617)951-7000
<TABLE>
CALCULATION OF REGISTRATION FEE
_________________________________________________________________
<S> <S> <C> <C> <C>
Proposed Proposed
Title of Maximum Maximum
Securities Offering Aggregate Amount of
to be Amount to be Price Per Offering Registration
Registered(1) Registered(1) Share(2) Price(2) Fee
- ------------- ------------- --------- ---------- ------------
Common Stock 600,000 $55.53125 $33,318,750 $9,829
$1 Par Value shares
</TABLE>
(1) Includes Preferred Share Purchase Rights. Prior to the
occurrence of certain events the Preferred Share Purchase
Rights will not be evidenced separately from the Common
Stock. Also includes such additional shares of Common Stock
as may be required in the event of a stock dividend,
recapitalization or other change in the Registrant's capital
stock.
(2) Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457 under the Securities
Act of 1933. The aggregate offering price has been
estimated on the basis of the average of the high and low
price for the Registrant's Common Stock as reported on the
New York Stock Exchange on September 30, 1998.
EXPLANATORY NOTE
This Registration Statement covers 600,000 shares of the
Registrant's Common stock (and Preferred Share Purchase Rights)
to be issued pursuant to the State Street Global Advisors Equity
Compensation Plan.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The Registrant hereby incorporates the following documents
herein by reference:
(1) The Registrant's Annual Report on Form 10-K for the
fiscal year ended December 31, 1997, as filed with the
Securities and Exchange Commission (the "Commission") on
March 26, 1998.
(2) The Registrant's Quarterly Reports on form 10-Q for the
periods ended March 31, 1998, as filed with the
Commission on May 12, 1998, and June 30, 1998, as filed
with the Commission on August 14, 1998.
(3) The description of the Registrant's Common Stock
included in the Registrant's effective registration
statement on Form 8-A, as filed with the Commission on
September 30, 1988, as amended by Amendment No.1 thereto
filed with the Commission on October 22, 1990 and
Amendment No.2 filed with the Commission on July 7,
1998.
(4) The Registrant's Current Reports on Form 8-K dated July
7, 1998 and Form 8-K/A dated September 17, 1998.
(5) All other reports filed by the Registrant with the
Commission pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act")
since the end of the fiscal year covered by the
Registrant's Annual Report referred to above.
All documents subsequently filed by the Registrant pursuant
to Sections 13(a), 13(c), 14 or 15(d) of 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
-2-
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.
Any statement contained herein or in a document incorporated
by reference shall be deemed to be modified or superseded for
purposes of this Registration Statement to the extent that a
statement contained in this Registration Statement or in any
other subsequently filed document which also is or is deemed to
be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute
a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the shares to be offered hereby will be
passed upon for the Registrant by Ropes & Gray. Truman S.
Casner, a partner of Ropes & Gray, is a director of the
Registrant and owns beneficially a total of 13,858 shares of
Common Stock of the Registrant. Ropes & Gray performs services
for the Registrant from time to time.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 67 of Chapter 156B of the General Laws of
Massachusetts provides that to the extent specified in or
authorized by the articles of organization, a by-law adopted by
stockholders, or a vote adopted by the holders of the majority of
shares of stock entitled to vote on the election of directors, a
corporation may indemnify directors, officers, employees and
other agents of the corporation, (and persons who serve at its
request as directors, officers, employees or other agents of
another organization or who serve at its request in any capacity
with respect to any employee benefit plan) except with respect to
any matter as to which such person shall have been adjudicated in
any proceeding not to have acted in good faith in the reasonable
belief that the action was in the best interest of the
corporation or the participants or beneficiaries of such employee
benefit plan.
The Restated Articles of Organization of the Registrant
(Article 6) provide the following:
-3-
The corporation shall to the fullest extent legally permissible
indemnify each person who is or was a director, officer, employee
or other agent of the corporation and each person who is or was
serving at the request of the corporation as a director, trustee,
officer, employee or other agent of another corporation or of any
partnership, joint venture, trust, employee benefit plan or other
enterprise or organization against all liabilities, costs and
expenses, including but not limited to amounts paid in
satisfaction of judgments, in settlement or as fines and
penalties, and counsel fees and disbursements, reasonably
incurred by him in connection with the defense or
disposition of or otherwise in connection with or resulting from
any action, suit or other proceeding, whether civil, criminal,
administrative or investigative, before any court or
administrative or legislative or investigative body, in which he
may be or may have been involved as a party or otherwise or with
which he may be or may have been threatened, while in office or
thereafter, by reason of his being or having been such a
director, officer, employee, agent or trustee, or by reason of
any action taken or not taken in any such capacity, except with
respect to any matter as to which he shall have been finally
adjudicated by a court of competent jurisdiction not to have
acted in good faith in the reasonable belief that his action was
in the best interests of the corporation (any person serving
another organization in one or more of the indicated capacities
at the request of the corporation who shall not have been
adjudicated in any proceeding not to have acted in good faith in
the reasonable belief that his action was in the best interest of
such other organization shall be deemed so to have acted in good
faith with respect to the corporation) or to the extent that such
matter relates to service with respect to an employee benefit
plan, in the best interest of the participants or beneficiaries
of such employee benefit plan. Expenses, including but not
limited to counsel fees and disbursements, so incurred by any
such person in defending any such action, suit or proceeding,
shall be paid from time to time by the corporation in advance of
the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of the person
indemnified to repay the amounts so paid if it shall ultimately
be determined that indemnification of such expenses is not
authorized hereunder.
If, in an action, suit or proceeding brought by or in the
name of the corporation, a director of the corporation is held
not liable for monetary damages, whether because that director is
relieved of personal liability under the provisions of this
Article Six of the
-4-
Articles of Organization, or otherwise, that director shall be
deemed to have met the standard of conduct set forth above and
to be entitled to indemnification for expenses reasonably
incurred in the defense of such action, suit or proceeding.
As to any matter disposed of by settlement by any such
person, pursuant to a consent decree or otherwise, no such
indemnification either for the amount of such settlement or for
any other expenses shall be provided unless such settlement shall
be approved as in the best interests of the corporation, after
notice that it involves such indemnification, (a) by vote of a
majority of the disinterested directors then in office (even
though the disinterested directors be less than a quorum), or (b)
by any disinterested person or persons to whom the question may
be referred by vote of a majority of such disinterested
directors, or (c) by vote of the holders of a majority of the
outstanding stock at the time entitled to vote for directors,
voting as a single class, exclusive of any stock owned by any
interested person, or (d) by any disinterested person or persons
to whom the question may be referred by vote of the holders of a
majority of such stock. No such approval shall prevent the
recovery from any such director, officer, employee, agent or
trustee of any amounts paid to him or on his behalf as
indemnification in accordance with the preceding sentence if such
person is subsequently adjudicated by a court of competent
jurisdiction not to have acted in good faith in the reasonable
belief that his action was in the best interests of the
corporation.
The right of indemnification hereby provided shall not be
exclusive of or affect any other rights to which any director,
officer, employee, agent or trustee may be entitled or which may
lawfully be granted to him. As used herein, the terms
"director", "officer", "employee", "agent" and "trustee" include
their respective executors, administrators and other legal
representatives, an "interested" person is one against whom the
action, suit or other proceeding in question or another action,
suit or other proceeding on the same or similar grounds is then
or had been pending or threatened, and a "disinterested" person
is a person against whom no such action, suit or other proceeding
is then or had been pending or threatened.
By action of the board of directors, notwithstanding any
interest of the directors in such action, the corporation may
purchase and maintain insurance, in such amounts as the board of
directors may from time to time deem appropriate, on behalf of
any person who is
-5-
or was a director, officer, employee or other agent of the
corporation, or is or was serving at the request of
the corporation as a director, trustee, officer, employee or
other agent of another corporation or of any partnership, joint
venture, trust, employee benefit plan or other enterprise or
organization against any liability incurred by him in any such
capacity, or arising out of his status as such, whether or not
the corporation would have the power to indemnify him against
such liability.
In addition, the Registrant maintains a directors' and
officers' liability insurance policy.
Article 6 of the Registrant's Restated Articles of
Organization also provides that 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 notwithstanding any provision of law imposing such
liability, provided, however, that this paragraph of Article Six
shall not eliminate the liability of a director to the extent
such liability is imposed by applicable law (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 or
law, (iii) for any transaction from which the director derived an
improper personal benefit, or (iv) for paying a dividend,
approving a stock repurchase or making loans which are illegal
under certain provisions of Massachusetts law, as the same exists
or hereafter may be amended.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
Exhibit No. Description
4.1 Restated Articles of Organization as amended
(filed with the Securities and Exchange
Commission as Exhibit 3.1 to Registrant's
Annual Report on Form 10-K for the fiscal
year ended December 31, 1997, and
incorporated by reference)
-6-
4.2 By-laws as amended (filed with the Securities
and Exchange Commission as Exhibit 3.2 to
Registrant's Annual Report on Form 10-K for
the fiscal year ended December 31, 1992, and
incorporated by reference)
5.1 Opinion of Counsel
15.1 Letter re unaudited interim financial
information
23.1 Consent of Ernst & Young LLP
23.2 Consent of Ropes & Gray (included in
Exhibit 5.1)
24.1 Power of Attorney (contained in Part II
hereof under Signature and Power of Attorney)
99.1 State Street Global Advisors Equity
Compensation Plan
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events 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) shall not apply if 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
-7-
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer, or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
-8-
SIGNATURES AND POWER OF ATTORNEY
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 Boston, the Commonwealth of Massachusetts on the 2nd
day of October, 1998.
STATE STREET CORPORATION
By: /s/Rex S. Schuette
---------------------------
Rex S. Schuette
Senior Vice President and
Chief Accounting Officer
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities indicated on September 10, 1998.
In addition, the undersigned officers and directors of State
Street Corporation (the "Corporation") hereby severally
constitute and appoint Ronald L. O'Kelley, Maureen Scannell
Bateman and Rex S. Schuette, and each of them singly, our true
and lawful attorneys with full power to them, and each of them
singly, to sign for us and in our names in the capacities as
indicated, any and all amendments or supplements to the
Registration Statement on Form S-8 of the Corporation, and
generally to do all such things in our name and on our behalf in
our capacities as indicated to enable the Corporation to comply
with the provisions of the Securities Act of 1933, as amended,
and all requirements of the Securities and Exchange Commission,
hereby ratifying and confirming our signatures as they may be
required by our said attorneys or any of them, to any and all
amendments.
-9-
Signature Title
--------- -----
/s/Marshall N. Carter
- ------------------------- Chairman and Chief Executive Officer
Marshall N. Carter and Director (Principal Executive
Officer)
/s/Ronald L. O'Kelley
- ------------------------- Executive Vice President and Chief
Ronald L. O'Kelley Financial Officer (Principal Financial
Officer)
/s/Rex S. Schuette
- ------------------------- Senior Vice President and Chief
Rex S. Schuette Accounting Officer (Principal
Accounting Officer)
- ------------------------- Director
Tenley E. Albright
/s/I. MacAllister Booth
- ------------------------- Director
I. MacAllister Booth
/s/James I. Cash, Jr.
- ------------------------- Director
James I. Cash, Jr.
/s/Truman S. Casner
- ------------------------- Director
Truman S. Casner
/s/Nader F. Darehshori
- ------------------------- Director
Nader F. Darehshori
/s/Arthur L. Goldstein
- ------------------------- Director
Arthur L. Goldstein
/s/David P. Gruber
- ------------------------- Director
David P. Gruber
/s/Charles F. Kaye
- ------------------------- Director
Charles F. Kaye
/s/John M. Kucharski
- ------------------------- Director
John M. Kucharski
-10-
Signature Title
--------- -----
/s/Charles R. LaMantia
- ------------------------- Director
Charles R. LaMantia
- ------------------------- Director
David B. Perini
/s/Dennis J. Picard
- ------------------------- Director
Dennis J. Picard
/s/Alfred Poe
- ------------------------- Director
Alfred Poe
/s/Bernard W. Reznicek
- ------------------------- Director
Bernard W. Reznicek
/s/David A. Spina
- ------------------------- Director
David A. Spina
/s/Diane C. Walsh
- ------------------------- Director
Diana C. Walsh
/s/Robert E. Weissman
- ------------------------- Director
Robert E. Weissman
-11-
INDEX TO EXHIBITS
Exhibit Number Exhibit
- -------------- -------
4.1 Restated Articles of Organization as amended
(filed with the Securities and Exchange
Commission as Exhibit 3.1 to Registrant's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1997, and incorporated by
reference)
4.2 By-laws as amended (filed with the Securities and
Exchange Commission as Exhibit 3.2 to Registrant's
Annual Report on Form 10-K for the fiscal year
ended December 31, 1992, and incorporated by
reference)
5.1 Opinion of Counsel
15.1 Letter re unaudited interim financial
information
23.1 Consent of Ernst & Young LLP
23.2 Consent of Ropes & Gray (included in Exhibit 5.1)
24.1 Power of Attorney (contained in Part II hereof
under Signature and Power of Attorney)
99.1 State Street Global Advisors Equity Compensation
Plan
-12-
EXHIBIT 5.1
[Letterhead of ROPES & GRAY]
September 25, 1998
State Street Corporation
225 Franklin Street
Boston, MA 02110
Ladies and Gentlemen:
This opinion is furnished to you in connection with a
registration statement on Form S-8 (the "Registration
Statement") to be filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933,
as amended, for the registration of 600,000 shares of common
stock, $1.00 par value per share (the "Common Stock"), of State
Street Corporation, a Massachusetts corporation (the "Company"),
to be sold pursuant to the Company's State Street Global Advisors
Equity Compensation Plan (the "Plan").
We have acted as counsel for the Company in the past and are
familiar with the actions taken by the Company in connection with
the Plan. For purposes of this opinion we have examined the
Registration Statement, the Plan and such other documents as we
have deemed appropriate.
We have made such examination of Massachusetts law as we
have deemed relevant for purposes of this opinion but have not
made any review of the laws of any other state or jurisdiction.
Accordingly, this opinion is limited to Massachusetts law.
Based upon the foregoing, we are of the opinion that (i) the
Common Stock has been duly authorized, and (ii) the Common Stock,
when issued and sold in accordance with the terms of the Plan,
will have been validly issued and will be fully paid and
non-assessable.
We hereby consent to your filing this opinion as an exhibit
to the Registration Statement.
Very truly yours,
/s/Ropes & Gray
Ropes & Gray
EXHIBIT 15.1
The Stockholders and Board of Directors
State Street Corporation
We are aware of the incorporation by reference in the
Registration Statement on Form S-8 pertaining to the State Street
Global Advisors Equity Compensation Plan of State Street
Corporation of our reports dated April 13, 1998 and July 14,
1998 relating to the unaudited consolidated interim
financial statements of State Street Corporation that are
included in its Form 10-Q for the quarters ended March 31, 1998
and June 30, 1998, respectively.
Pursuant to Rule 436(c) of the Securities Act of 1933, our
reports are not a part of the registration statement prepared or
certified by accountants within the meaning of Section 7 or 11 of
the Securities Act of 1933.
/s/Ernst & Young LLP
ERNST & YOUNG LLP
Boston, Massachusetts
September 28, 1998
EXHIBIT 23.1
Consent of Independent Auditors
We consent to the reference to our firm under the caption
"Interest of Named Experts and Counsel" in the Registration
Statement on Form S-8 pertaining to the State Street Global
Advisors Equity Compensation Plan of State Street Corporation
and to the incorporation by reference therein of our report
dated January 13, 1998, with respect to the consolidated
financial statements of State Street Corporation incorporated by
reference in its Annual Report (Form 10-K) for the year ended
December 31, 1997, filed with the Securities and Exchange
Commission.
/s/Ernst & Young LLP
ERNST & YOUNG LLP
Boston, Massachusetts
September 28, 1998
EXHIBIT 99.1
STATE STREET GLOBAL ADVISORS
EQUITY COMPENSATION PLAN
I. INTRODUCTION; PURPOSE
The purpose of the State Street Global Advisors Equity
Compensation Plan set forth herein (the "Plan") is to increase
the financial success of State Street Global Advisors ("SSgA"), a
division of State Street Bank and Trust Company (the "Bank"), and
thereby further the interests of State Street Corporation
[formerly State Street Boston Corporation] (the "Corporation")
and its subsidiaries, including the Bank, and the interests of
the Corporation's shareholders by granting to key officers of
SSgA awards ("Awards") based on the common stock of the
Corporation ("Stock").
II. ADMINISTRATION
The Plan will be administered by the Executive Compensation
Committee (the "Committee") of the Board of Directors of the
Corporation. The Committee shall have complete authority,
subject to the terms of the Plan, to do any of the following in
its discretion: (i) grant Awards in accordance with III. below;
(ii) waive compliance by a holder of an Award with any obligation
to be performed by the holder under the Award, and waive any
terms or conditions of an Award; (iii) amend or cancel an
existing Award in whole or in part (and if an Award is canceled,
grant another Award in accordance with III. below, with the same
or different terms, in its place), except that no such action
shall adversely affect the rights of a holder of an Award without
the holder's consent; (iv) prescribe and modify the form or forms
of all notices, elections, agreements, or other instruments, if
any, to be used under the Plan; (v) adopt, amend, and rescind
rules for the administration of the Plan; and (vi) interpret the
Plan and Awards and decide any questions and settle all
controversies and disputes that may arise in connection with the
Plan or any Award. Determinations and actions by the Committee
shall be conclusive and shall bind all parties.
III. ELIGIBILITY AND PARTICIPATION; AWARDS
Participation in the plan is limited to the Chief Executive
Officer (CEO) of SSgA and those other senior officers of SSgA
whose responsibilities are expected to have a direct impact on
the financial success of SSgA and who are selected for
participation in the Plan by the CEO of SSgA with the prior
approval of the CEO of the Corporation. The initial Awards under
the Plan as approved by the Committee, covering all shares
initially available under the Plan, shall be made to the
individuals and for the number of shares specified in Exhibit A.
If additional shares become available under the Plan pursuant to
IV.(b) below, additional Awards may be made as follows: (a) if
to the CEO of SSgA, by the Committee in its discretion; and (b)
if to any other officer of SSgA, by the CEO of SSgA with the
prior approval of the CEO of the Corporation.
IV. TERMS AND CONDITIONS
(a) Awards. Except as otherwise specifically provided,
each Award shall consist of an unfunded and unsecured commitment
by the Corporation to make future delivery of shares of Stock in
accordance with the terms of the Plan.
(b) Shares Available for Awards.* The total number of
shares of Stock reserved for issuance under the Plan is 600,000.
Except as otherwise specified by the Committee, all shares
delivered under the Plan shall be treasury shares. In the event
of a stock dividend, stock split, recapitalization or similar
change in the capitalization of the Corporation, the Committee
shall make appropriate adjustment in the number and type of
shares reserved for issuance under the Plan. To the extent an
Award or any portion thereof is forfeited under (c) below prior
to vesting, the shares of Stock underlying the forfeited portion
of the Award shall again be available for future Awards under the
Plan.
(c) Vesting and Distributions.
1. In the event a Participant's employment with SSgA terminates
for any reason, each Award held by the Participant shall be
immediately forfeited (and no payment shall be made with respect
thereto) except to the extent the Award was vested at time of
termination. Except as hereinafter provided, each Award shall be
vested as to 20% of the shares subject to the Award on December
31, 2001 and as to an additional 20% of the shares subject to the
Award on December 31 of each of 2002, 2003, 2004 and 2005.
2. If a Participant's employment with SSgA terminates by reason
of death, permanent disability as determined by the Committee, or
retirement at or after age 55 with at least ten years of service
with the Corporation and its subsidiaries ("retirement"), each
Award then held by the Participant shall be considered vested
immediately prior to such termination for a number of shares
equal to the product of (i) the full number of shares initially
covered by the Award, times (ii) a fraction, the numerator of
which is the full number of years elapsed since January 1, 1996,
and the denominator of which is ten (10). Vesting under this
paragraph shall be in lieu of any vesting under the second
sentence of 1. above.
3. Notwithstanding 1. above, if a Participant ceases to be
employed by SSgA but continues in the employment of the
Corporation and its subsidiaries (a "transfer"), or if a
Participant requests a change from full-time to part-time
employment within SSgA or requests reassignment to another
position within SSgA and such other position involves fewer
responsibilities or lower levels of remuneration (as determined
by the Committee in its sole discretion) and in either case such
request is granted (a "voluntary reduction in position"), the
Participant (i) shall promptly forfeit so much of his or her
Awards as would be treated as not having vested under 2. above
had the Participant retired (as defined under 2. above) on the
date of the transfer or voluntary reduction in position, and (ii)
shall forfeit the remainder of such Awards (the "remaining
portion") if and when he or she suffers a termination of
employment with the Corporation and its subsidiaries (other than
by reason of death, permanent disability as determined by the
Committee, or retirement (as defined at 2. above)) prior to
having worked continuously for the Corporation and its
subsidiaries until the date (the "deferred vesting date") on
which, under the second sentence of 1. above, the Participant,
had he or she continued to work continuously in his or her
original position at SSgA, would have vested in a percentage of
his or her Award at least equal to the remaining portion. On
the deferred vesting date (if the Participant has continued to
work continuously for the Corporation and its subsidiaries until
such date), or in the event of the Participant's earlier death,
permanent disability as determined by the Committee, or
retirement (as defined at 2. above), the Participant shall be
deemed vested in so much of his or her Award as has not been
forfeited.
4. The Committee may prescribe different vesting rules than
those specified in 1., 2., or 3. above in connection with
additional Awards described in III.(a) or III.(b) above or in
such other circumstances as the Committee may determine. A
Participant shall not be deemed to have suffered a termination of
employment with SSgA merely by reason of a bona fide leave of
absence, as determined by the Committee in its discretion
5. On or as soon as practicable after December 31, 2005 (or
such other date as shall be specified in connection with the
grant of an Award or by the Committee after grant), the
Corporation shall deliver to each Participant or former
Participant then holding a vested Award (or to the beneficiary of
a deceased Participant who died holding an Award vested or deemed
vested under 1., 2. or 3. above) the shares of Stock subject to
the vested Award. In the event of the death, permanent
disability or retirement of a Participant, such shares shall
instead be delivered as soon as practicable after such death,
permanent disability or retirement.
(d) Shareholder rights. A Participant shall have no rights
as a shareholder with respect to Stock subject to Awards under
the Plan, including but not limited to rights to dividends or
voting rights, until such shares have been delivered.
(e) Nontransferability of Awards. Awards granted under the
Plan and rights thereunder may not be pledged, encumbered, sold,
exchanged or otherwise transferred or disposed of by a
Participant or by any other person, and any attempt to pledge,
encumber, sell, exchange or otherwise transfer or dispose of an
Award or any such interest shall be null and void.
Notwithstanding the foregoing, a Participant may designate a
beneficiary or beneficiaries to receive in accordance with (c)2.
or (c)3. above any shares of Stock payable under an Award held by
the Participant at time of death. Any beneficiary designation
hereunder shall be made in a form acceptable to the Committee and
subject to such conditions as the Committee may impose. In the
absence of an effective beneficiary designation form, a
Participant's estate shall be deemed to be the Participant's sole
designated beneficiary for purposes of the Plan.
V. MISCELLANEOUS PROVISIONS
(a) Change in Control. In the event the Corporation sells
all or substantially all of SSgA (a "covered transaction"), as
determined by the Committee, each Participant employed by SSgA
immediately prior to consummation of the covered transaction
shall be entitled to the delivery, as soon as practicable
following consummation of the covered transaction, of a number of
shares of Stock equal to the product of (i) the full number of
shares subject to all Awards then held by the Participant, times
(ii) a fraction, the numerator of which is the number of full
years elapsed from January 1, 1996 (determined as of the
consummation of the covered transaction) and the denominator of
which is ten (10). A different vesting proration formula may be
provided for in connection with additional Awards described in
III.(a) or III.(b) above. The benefits provided by this
paragraph shall be in addition to, and not in lieu of, benefits
provided under any change in control agreement to which the
Participant is a party.
(b) No hire/no solicitation/non-compete agreement. Each
Award to a Participant under the Plan shall be conditioned upon
the Participant's execution of an agreement in form satisfactory
to the Committee substantially to the effect that:
1. The Participant shall hold in a fiduciary capacity for the
benefit of the Corporation all secret or confidential
information, knowledge or data relating to the Corporation or any
of its subsidiaries, and their respective businesses and Clients
(as defined below), which shall have been obtained by the
Participant during the Participant's employment by the
Corporation or any of its affiliated companies and which shall
not be or become public knowledge (other than by acts by the
Participant or representatives of the Participant in violation
hereof) . After termination of the Participant's employment, the
Participant shall not, without the prior written consent of the
Corporation or as may otherwise be required by law or legal
process, communicate or divulge any such information, knowledge
or data to anyone other than the Corporation and those designated
by it. The term "Client" means any person or entity that is a
customer or client of the Corporation or any of its subsidiaries.
2. During the term of employment of the Participant and during
the Nonsolicitation Period (as defined below), the Participant
shall not, without the prior written consent of the Corporation,
solicit, directly or indirectly (other than through a general
solicitation of employment not specifically directed to employees
of the Corporation or its subsidiaries), the employment of any
person who within the previous 12 months was an officer of the
Corporation or any of its subsidiaries. The term
"Nonsolicitation Period" means the period beginning on the date
of termination of the Participant's employment with the
Corporation and its subsidiaries (the "Termination Date") and
ending eighteen (18) months after the Termination Date.
3. During the term of employment of Participant and during the
Nonsolicitation Period, the Participant shall not, without the
prior consent of the Corporation, engage in the Solicitation of
Business (as defined below) from any Client on behalf of any
person or entity other than the Corporation and its subsidiaries.
The term "Solicitation of Business" means the attempt through
direct personal contact on the part of the Participant with a
Client with whom the Participant has had significant personal
contact while employed by the Corporation and its subsidiaries to
induce such Client to transfer its business relationship from the
Corporation and its subsidiaries to any other person or entity;
4. For a period of eighteen (18) months following termination
of employment for any reason, the Participant shall not engage,
either directly or indirectly, in any manner or capacity as
advisor, principal, agent, partner, officer, director, employee,
member of any association, or otherwise, in any business or
activity which is at the time competitive with any business or
activity conducted by the Corporation or any of its subsidiaries.
5. In the event of a breach by the Participant of any of the
foregoing, (a) the Participant shall forfeit all rights to any
and all Awards then held by the Participant and shall promptly
refund to the Corporation any and all payments previously
received by him or her under Awards, and (b) the Corporation may
seek injunctive relief in addition to, and not in lieu of, any
other relief to which it may be entitled, including the relief
described at (a) immediately above.
6. Upon and following the occurrence (as determined by the
Committee) of a "covered transaction" as described in V.(a), the
nonsolicitation and noncompetition restrictions described in
paragraphs 2., 3., and 4. above shall cease to apply.
(c) No right to employment. Nothing herein shall entitle
any Participant to continued employment with the Corporation or
its subsidiaries, nor shall a claim of lost profits under any
Award be deemed an element of damages in any claim relating to
any termination of employment.
(d) Tax withholding, etc.. No shares of Stock shall be
required to be delivered under any Award until the Participant
(or if the Participant has died, his or her beneficiary(ies) or
estate) shall have paid to the Corporation in cash the full
amount of any tax withholding due in connection with such
delivery of shares or shall have made other provision
satisfactory to the Committee for the payment of such taxes. The
Corporation may require that a Participant remit to the
Corporation in cash the full amount of any FICA or similar taxes
that may become due prior to delivery of shares of Stock
hereunder, the payment of such taxes to be a condition to the
delivery to the Participant or his or her beneficiary(ies) of any
shares of Stock hereunder.
(e) Successors and assigns; certain mergers, etc. The
obligations of the Corporation under the Plan shall be binding
upon any successor to all or substantially all of the
Corporation's assets or business. In the event of a merger or
consolidation involving the Corporation in which the Corporation
is not the surviving entity, or which results in the acquisition
of all or substantially all of the Corporation's outstanding
stock by another entity, or in the event of a sale of all or
substantially all of the Corporation's business or assets or the
liquidation of the Corporation, (any of the foregoing, a
"termination event"), the Corporation may arrange for the
assumption of Awards by the successor or for substitute awards to
be granted by any successor on substantially the same terms,
taking into account changes in capitalization and related terms;
but if the Corporation does not or cannot provide for such
assumption or substitution, (i) each Award outstanding
immediately prior to the termination event shall be deemed vested
for the number of shares for which it would then have been vested
had a change in control of SSgA occurred on the date of the
termination event, and (ii) the Corporation prior to the
termination event (but contingent upon its consummation) shall
transfer such shares to the person holding such Award. Upon
consummation of the termination event all Awards shall terminate
unless assumed by a successor.
(f) Amendment and termination. The Committee may at any
time terminate the Plan and may at any time and from time to time
prior thereto amend the Plan or any Award in such manner and to
such extent as it may determine; provided, that no such action
shall adversely affect the rights of any person then holding an
Award, without such person's consent; and further provided, that
the Committee may not increase the number of shares of Stock
reserved for issuance under the Plan, other than in accordance
with the adjustment provisions of IV.(b) above, without the
approval of the Board of Directors.
(g) Governing law. The Plan and all Awards hereunder shall
be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts.
* Adjusted for the two-for-one stock split effective April 30,
1997.
