As filed with the Securities and Exchange Commission on May 16, 2002
Registration No. 333-_______
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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ENGELHARD CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 22-1586002
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
101 Wood Avenue, Iselin, New Jersey 08830
(Address of principal executive offices) (Zip Code)
ENGELHARD CORPORATION 2002 LONG TERM INCENTIVE PLAN
(Full title of the plan)
-------------------
ARTHUR A. DORNBUSCH, II
Vice President, General Counsel and Secretary
Engelhard Corporation
101 Wood Avenue
Iselin, NJ 08830
(732) 205-5000
(Name, address (including zip code) and
telephone number (including area code) of agent for
service in the United States)
With copies to:
John Schuster, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, New York 10005-1702
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CALCULATION OF REGISTRATION FEE
=====================================================================================================================
Title of Securities Amount Proposed Maximum Proposed Maximum Amount of
to be to be Offering Price Per Aggregate Offering Registration
Registered Registered (1) Share (2) Price (2) Fee (2)
---------------------------------------------------------------------------------------------------------------------
Common Stock,
($1.00 par value)(3) 6,000,000 Shares $31.65 $189,900,000 $17,.470.80
=====================================================================================================================
(1) Includes an indeterminate number of securities that may be issuable by
reason of stock splits, stock dividends or similar transactions, in
accordance with Rule 416 under the Securities Act of 1933, as amended (the
"Act").
(2) Estimated solely for purposes of calculating the registration fee. Pursuant
to Rules 457(c) and 457(h) under the Act, the registration fee has been
calculated based on the average of the high and low sale prices reported
for the common stock of Engelhard Corporation on May 9, 2002, which was
$31.65 per share, as reported on the New York Stock Exchange.
(3) Includes Rights associated with the Common Stock.
================================================================================
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PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS.
ITEM 1. PLAN INFORMATION
Engelhard Corporation (the "Company") has prepared this Registration
Statement in accordance with the requirements of Form S-8 under the Securities
Act of 1933, as amended (the "Act"), to register 6,000,000 shares of common
stock, $1.00 par value (the "Common Stock"), of the Company issuable pursuant to
the Company's 2002 Long Term Incentive Plan (the "Plan").
The documents containing the information specified in Part I of Form S-8
will be sent or given to participants in the Plan as specified by Rule 428(b)(1)
of the Act. Such document(s) are not being filed with the Commission, but
constitute (along with the documents incorporated by reference into this
Registration Statement pursuant to Item 3 of Part II of this Registration
Statement) a prospectus that meets the requirements of Section 10(a) of the Act.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
Upon written or oral request, any of the documents incorporated by
reference in Item 3 of Part II of this Registration Statement (which documents
are incorporated by reference in the Section 10(a) prospectus), other documents
required to be delivered to eligible participants pursuant to Rule 428(b) or
additional information about the Plan and its administrator are available
without charge by contacting:
Engelhard Corporation
101 Wood Avenue
Iselin, New Jersey 08830
Attention: Corporate Secretary
Phone: (732) 205-5000
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT.
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by the Registrant with the Commission are
hereby incorporated by reference in this Registration Statement:
(1) The Registrant's Annual Report on Form 10-K for the year ended
December 31, 2001;
(2) The Registrant's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2002; and
(3) The section entitled "Description of Capital Stock" contained in the
Registrant's Amendment No. 4 to the Registration Statement on Form S-3
(File No. 333-73185), filed on May 18, 1999.
All documents filed by the Registrant pursuant to Sections 13(a), 13(c), 14
or 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
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unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
The class of securities offered is registered under Section 12 of the
Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the General Corporation Law of the State of Delaware, as
amended July 1, 1997 ("Section 145") empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that such person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation or enterprise. Depending on the character of the proceeding,
a corporation may indemnify against expenses (including attorneys' fees),
judgments, fines and/or amounts paid in settlement actually and reasonably
incurred in connection with such action, suit or proceeding if the person
indemnified acted in good faith and in a manner such person reasonably believed
to be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
such person's conduct was unlawful. In the case of an action by or in the right
of the corporation, no indemnification may be made with respect to any claim,
issue or matter as to which such person shall have been adjudged to be liable to
the corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine that despite the
adjudication of liability such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper. Section 145
further provides that to the extent that a present or former director or officer
of a corporation has been successful in the defense of any action, or any claim,
issue or matter therein, such person shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by such person in
connection therewith. Section 145 also states that the indemnification provided
for in such Section shall not be deemed exclusive of any other rights to which
the indemnified party may be entitled and empowers the corporation to purchase
and maintain insurance on behalf of directors, officers, employees and agents of
the corporation against any liability asserted against such person or incurred
by such person in any such capacity or arising out of such person's status as
such whether or not the corporation would have the power to indemnify such
person against such liabilities under Section 145.
Articles NINTH and TENTH of the Registrant's Restated Certificate of
Incorporation provide that to the fullest extent permitted by Delaware law, no
director of the Registrant will be liable to the Registrant or its shareholders
for monetary damages for breach of fiduciary duty as a director. In accordance
with Delaware law, the Registrant's Restated Certificate of Incorporation
provides that the directors will be liable to the Registrant, (i) for any breach
of the director's duty of loyalty to the Registrant or its shareholders, (ii)
for acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) in respect of certain unlawful dividend
payments, stock redemptions or repurchases, or (iv) for any transaction from
which the director derived an improper personal benefit. The effect of the
provision in the Restated Certificate of Incorporation is to eliminate the
rights of the Registrant and its shareholders (including through shareholders'
derivative suits on behalf of the Registrant) to recover monetary damages
against a director for breach of fiduciary duty as a director (including
breaches resulting from negligent or grossly negligent behavior) except in the
situations described in clauses (i) through (iv) above. These provisions do not
alter the liability of directors under federal
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securities laws. In addition, the Registrant maintains officers' and directors'
liability insurance for the benefit of its officers and directors.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The Exhibits to this Registration Statement are listed in the Exhibit Index
of this Registration Statement, which Index is incorporated herein by reference.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement: (i) to include any
prospectus required by section 10(a)(3) of the Act; (ii) to reflect in the
prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the
information set forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
registration statement; (iii) to include any material information with respect
to the plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the Registration
Statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed 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 Act, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(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.
(4) That, for purposes of determining any liability under the Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Exchange Act that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such
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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.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Iselin, State of New Jersey, on May 16, 2002.
ENGELHARD CORPORATION
By: /s/ Michael A. Sperduto
------------------------------------
Michael A. Sperduto
Vice President, Chief Financial Officer
and Chief Accounting Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
* Chairman, Chief Executive Officer and Director May 16, 2002
------------------------------ (Principal Executive Officer)
Barry W. Perry
/s/ Michael A. Sperduto Vice President, Chief Financial Officer and May 16, 2002
--------------------------------- Chief Accounting Officer (Principal Accounting
Michael A. Sperduto Officer)
* Director May 16, 2002
---------------------------------
Marion H. Antonini
* Director May 16, 2002
---------------------------------
James V. Napier
* Director May 16, 2002
---------------------------------
Norma T. Pace
* Director May 16, 2002
---------------------------------
Henry R. Slack
* Director May 16, 2002
---------------------------------
Douglas G. Watson
-----------------------
* The undersigned, by signing his name hereto, does hereby sign this
Registration Statement on behalf of each of the above-indicated directors
of the Registrant pursuant to powers of attorney, executed on behalf of
each such director.
By: /s/ Arthur A. Dornbusch, II
---------------------------
Arthur A. Dornbusch, II
Attorney-in-fact
INDEX TO EXHIBITS
Exhibit
4.1 Restated Certificate of Incorporation (incorporated by reference to the
Registrant's Form 10, as amended on Form 8-K filed with the Securities and
Exchange Commission on May 19, 1981).
4.2 By-Laws as amended September 17, 1981 (incorporated by reference to the
Registrant's Form 10-Q for the quarter ended September 30, 1981).
4.3 Certificate of Amendment to the Restated Certificate of Incorporation
(incorporated by reference to the Registrant's Form 10-K for the year ended
December 31, 1987).
4.4 Article XVII of the Registrant's By-Laws as amended on May 2, 1988
(incorporated by reference to the Registrant's Form 8-K filed with the
Securities and Exchange Commission on May 21, 1988).
4.5 Certificate of Amendment to the Restated Certificate of Incorporation
(incorporated by reference to the Registrant's Form 10-Q for the quarter
ended March 31, 1993).
4.6 Certificate of Amendment to the Restated Certificate of Incorporation
(incorporated by reference to the Registrant's Form 10-Q for the quarter
ended March 31, 1996).
4.7 By-Laws as amended June 12, 1997 (incorporated by reference to the
Registrant's Form 10-Q for the quarter ended June 30, 1997).
4.8 Form of Rights Agreement dated as of October 1, 1998 between the Registrant
and ChaseMellon Shareholder Services, LLC (filed as Exhibit 1 to
Registration Statement on Form 8-A filed October 29, 1998 and incorporated
herein by reference).
4.9 Article II of the Registrant's By-Laws as amended December 17, 1998
(incorporated by reference to the Registrant's Form S-8 filed with the
Securities and Exchange Commission on January 29, 1999).
4.10 Article II, Section 8 of the By-Laws of the Registrant as amended March 1,
2001 (incorporated by reference to the Registrant's Form 10-K for the year
ended December 31, 2000).
4.11 Engelhard Corporation 2002 Long Term Incentive Plan.
5 Opinion of Cahill Gordon & Reindel.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Cahill Gordon & Reindel - contained in the opinion filed as
Exhibit 5.
24 Powers of Attorney from Directors.
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99 Letter regarding independent public accountants (incorporated by reference
to the Registrant's Form 10-K for the year ended December 31, 2001).
Exhibit 4.11
ENGELHARD CORPORATION
2002 LONG TERM INCENTIVE PLAN
(1) Purposes.
The purposes of the 2002 Long Term Incentive Plan are to advance the
interests of Engelhard Corporation and its shareholders by providing a means to
attract, retain, and motivate employees and directors of the Company upon whose
judgment, initiative and efforts the continued success, growth and development
of the Company is dependent.
(2) Definitions.
For purposes of the Plan, the following terms shall be defined as set forth
below:
(a) "Affiliate" means any entity other than the Company and its
Subsidiaries that is designated by the Board or the Committee as a
participating employer under the Plan, provided that the Company directly
or indirectly owns at least 20% of the combined voting power of all classes
of stock of such entity or at least 20% of the ownership interests in such
entity.
(b) "Award" means any Option, SAR, Restricted Share, Restricted Share
Unit, Performance Share, Performance Unit, or Other Share-Based Award
granted to an Eligible Person under the Plan.
(c) "Award Agreement" means any written agreement, contract, or other
instrument or document evidencing an Award.
(d) "Beneficiary" means the person, persons, trust or trusts which
have been designated by an Eligible Person in his or her most recent
written beneficiary designation filed with the Company to receive the
benefits specified under this Plan upon the death of the Eligible Person,
or, if there is no designated Beneficiary or surviving designated
Beneficiary, then the person, persons, trust or trusts entitled by will or
the laws of descent and distribution to receive such benefits.
(e) "Board" means the Board of Directors of the Company.
(f) "Code" means the Internal Revenue Code of 1986, as amended from
time to time. References to any provision of the Code shall be deemed to
include successor provisions thereto and regulations thereunder.
(g) "Committee" means the Stock Option/Stock Bonus Committee of the
Board, or such other Board committee (which may include the entire Board)
as may be designated by the Board to administer the Plan; provided,
however, that unless otherwise determined by the Board, the Committee shall
consist of two or more directors of the Company, each of whom is a
"non-employee director" within the meaning of Rule 16b-3 under the Exchange
Act, to the extent applicable, and each of whom is an "outside director"
within the meaning of Section 162(m) of the Code, to the extent applicable;
and provided further that the mere fact that the Committee shall fail to
qualify under either of the foregoing requirements shall not invalidate any
Award made by the Committee which Award is otherwise validly made under the
Plan.
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(h) "Company" means Engelhard Corporation, a corporation organized
under the laws of Delaware, or any successor corporation.
(i) "Director" means a member of the Board who is not an employee of
the Company, a Subsidiary or an Affiliate.
(j) "Eligible Person" means (i) an employee of the Company, a
Subsidiary or an Affiliate, including any director who is an employee, or
(ii) a Director.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time. References to any provision of the Exchange Act
shall be deemed to include successor provisions thereto and regulations
thereunder.
(l) "Fair Market Value" means, with respect to Shares or other
property, the fair market value of such Shares or other property determined
by such methods or procedures as shall be established from time to time by
the Committee. If the Shares are listed on any established stock exchange
or a national market system, unless otherwise determined by the Committee
in good faith, the Fair Market Value of Shares shall mean the mean between
the high and low selling prices per Share on the immediately preceding date
(or, if the Shares were not traded on that day, the next preceding day that
the Shares were traded) on the principal exchange on which the Shares are
traded, as such prices are officially quoted on such exchange.
(m) "ISO" means any option intended to be and designated as an
incentive stock option within the meaning of Section 422 of the Code.
(n) "NQSO" means any Option that is not an ISO.
(o) "Option" means a right, granted under Section 5(b), to purchase
Shares.
(p) "Other Share-Based Award" means a right, granted under Section
5(g), that relates to or is valued by reference to Shares.
(q) "Participant" means an Eligible Person who has been granted an
Award under the Plan.
(r) "Performance Share" means a performance share granted under
Section 5(f).
(s) "Performance Unit" means a performance unit granted under Section
5(f).
(t) "Plan" means this 2002 Long Term Incentive Plan.
(u) "Restricted Shares" means an Award of Shares under Section 5(d)
that may be subject to certain restrictions and to a risk of forfeiture.
(v) "Restricted Share Unit" means a right, granted under Section 5(e),
to receive Shares or cash at the end of a specified deferral period.
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(w) "Rule 16b-3" means Rule 16b-3, as from time to time in effect and
applicable to the Plan and Participants, promulgated by the Securities and
Exchange Commission under Section 16 of the Exchange Act.
(x) "SAR" or "Share Appreciation Right" means the right, granted under
Section 5(c), to be paid an amount measured by the difference between the
exercise price of the right and the Fair Market Value of Shares on the date
of exercise of the right, with payment to be made in cash, Shares, or
property as specified in the Award or determined by the Committee.
(y) "Shares" means common stock, $1.00 par value per share, of the
Company.
(z) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of the
corporations (other than the last corporation in the unbroken chain) owns
shares possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain.
(3) Administration.
(a) Authority of the Committee. The Plan shall be administered by the
Committee, and the Committee shall have full and final authority to take
the following actions, in each case subject to and consistent with the
provisions of the Plan:
(i) to select Eligible Persons to whom Awards may be granted;
(ii) to designate Affiliates;
(iii) to determine the type or types of Awards to be granted to
each Eligible Person;
(iv) to determine the type and number of Awards to be granted,
the number of Shares to which an Award may relate, the terms and
conditions of any Award granted under the Plan (including, but not
limited to, any exercise price, grant price, or purchase price, any
restriction or condition, any schedule for lapse of restrictions or
conditions relating to transferability or forfeiture, exercisability,
or settlement of an Award, and waiver or accelerations thereof, and
waivers of performance conditions relating to an Award, based in each
case on such considerations as the Committee shall determine), and all
other matters to be determined in connection with an Award;
(v) to determine whether, to what extent, and under what
circumstances an Award may be settled, or the exercise price of an
Award may be paid, in cash, Shares, other Awards, or other property,
or an Award may be canceled, forfeited, exchanged, or surrendered;
(vi) to determine whether, to what extent, and under what
circumstances cash, Shares, other Awards, or other property payable
with respect to an Award will be deferred either automatically, at the
election of the Committee, or at the election of the Eligible Person;
(vii) to prescribe the form of each Award Agreement, which need
not be identical for each Eligible Person;
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(viii) to adopt, amend, suspend, waive, and rescind such rules
and regulations and appoint such agents as the Committee may deem
necessary or advisable to administer the Plan;
(ix) to correct any defect or supply any omission or reconcile
any inconsistency in the Plan and to construe and interpret the Plan
and any Award, rules and regulations, Award Agreement, or other
instrument hereunder;
(x) to accelerate the exercisability or vesting of all or any
portion of any Award or to extend the period during which an Award is
exercisable;
(xi) to determine whether uncertificated Shares may be used in
satisfying Awards and otherwise in connection with the Plan; and
(xii) to make all other decisions and determinations as may be
required under the terms of the Plan or as the Committee may deem
necessary or advisable for the administration of the Plan.
(b) Manner of Exercise of Committee Authority. The Committee shall
have sole discretion in exercising its authority under the Plan. Any action
of the Committee with respect to the Plan shall be final, conclusive, and
binding on all persons, including the Company, Subsidiaries, Affiliates,
Eligible Persons, any person claiming any rights under the Plan from or
through any Eligible Person, and shareholders. The express grant of any
specific power to the Committee, and the taking of any action by the
Committee, shall not be construed as limiting any power or authority of the
Committee. Notwithstanding any provision of the Plan to the contrary, the
Chief Executive Officer of the Company shall have the power and authority,
subject to the terms and conditions of the Plan, to make awards under the
Plan to executives who are not officers or directors of the Company for
purposes of Section 16(b) of the Securities Exchange Act of 1934, as
amended; provided, however, that the authority of the Chief Executive
Officer to make such awards shall be subject to limitations as may be
imposed from time to time by the Committee.
(c) Limitation of Liability. Each member of the Committee shall be
entitled to, in good faith, rely or act upon any report or other
information furnished to him or her by any officer or other employee of the
Company or any Subsidiary or Affiliate, the Company's independent certified
public accountants, or other professional retained by the Company to assist
in the administration of the Plan. No member of the Committee, nor any
officer or employee of the Company acting on behalf of the Committee, shall
be personally liable for any action, determination, or interpretation taken
or made in good faith with respect to the Plan, and all members of the
Committee and any officer or employee of the Company acting on their behalf
shall, to the extent permitted by law, be fully indemnified and protected
by the Company with respect to any such action, determination, or
interpretation.
(d) Limitation on Committee's Discretion. Anything in this Plan to the
contrary notwithstanding, in the case of any Award which is intended to
qualify as "performance-based compensation" within the meaning of Section
162(m)(4)(C) of the Code, if the Award Agreement so provides, the Committee
shall have no discretion to increase the amount of compensation payable
under the Award to the extent such an increase would cause the Award to
lose its qualification as such performance-based compensation.
(e) No Option or SAR Repricing Without Shareholder Approval. Except as
provided in the first sentence of Section 4(c) hereof relating to certain
antidilution adjustments, unless the approval
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of shareholders of the Company is obtained, Options and SARs issued under
the Plan shall not be amended to lower their exercise price and Options and
SARs issued under the Plan will not be exchanged for other Options or SARs
with lower exercise prices.
(4) Shares Subject to the Plan.
(a) Subject to adjustment as provided in Section 4(c) hereof, (i) the
total number of Shares reserved for issuance in connection with Awards
under the Plan shall be 6,000,000 and (ii) the total number of Shares
reserved for issuance in connection with Awards other than Options and SARs
(i.e., Restricted Share, Restricted Unit, Performance Share, Performance
Unit and Other Share-Based Awards) shall be 500,000. No Award may be
granted if the number of Shares to which such Award relates, when added to
the number of Shares previously issued under the Plan, exceeds the number
of Shares reserved under the applicable provision of the preceding
sentence. If any Awards are forfeited, canceled, terminated, exchanged or
surrendered or such Award is settled in cash or otherwise terminates
without a distribution of Shares to the Participant, any Shares counted
against the number of Shares reserved and available under the Plan with
respect to such Award shall, to the extent of any such forfeiture,
settlement, termination, cancellation, exchange or surrender, again be
available for Awards under the Plan. Upon the exercise of any Award granted
in tandem with any other Awards, such related Awards shall be canceled to
the extent of the number of Shares as to which the Award is exercised.
(b) Subject to adjustment as provided in Section 4(c) hereof, the
maximum number of Shares (i) with respect to which Options or SARs may be
granted during a calendar year to any Eligible Person under this Plan shall
be 1,000,000 Shares, and (ii) with respect to Performance Shares,
Performance Units, Restricted Shares or Restricted Share Units intended to
qualify as performance-based compensation within the meaning of Section
162(m)(4)(C) of the Code shall be the equivalent of 100,000 Shares during a
calendar year to any Eligible Person under this Plan.
(c) In the event that the Committee shall determine that any dividend
in Shares, recapitalization, Share split, reverse split, reorganization,
merger, consolidation, spin-off, combination, repurchase, or share
exchange, or other similar corporate transaction or event, affects the
Shares such that an adjustment is appropriate in order to prevent dilution
or enlargement of the rights of Eligible Persons under the Plan, then the
Committee shall make such equitable changes or adjustments as it deems
appropriate and, in such manner as it may deem equitable, adjust any or all
of (i) the number and kind of shares which may thereafter be issued under
the Plan, (ii) the number and kind of shares, other securities or other
consideration issued or issuable in respect of outstanding Awards, and
(iii) the exercise price, grant price, or purchase price relating to any
Award; provided, however, in each case that, with respect to ISOs, such
adjustment shall be made in accordance with Section 424(a) of the Code,
unless the Committee determines otherwise. In addition, the Committee is
authorized to make adjustments in the terms and conditions of, and the
criteria and performance objectives included in, Awards in recognition of
unusual or non-recurring events (including, without limitation, events
described in the preceding sentence) affecting the Company or any
Subsidiary or Affiliate or the financial statements of the Company or any
Subsidiary or Affiliate, or in response to changes in applicable laws,
regulations, or accounting principles; provided, however, that, if an Award
Agreement specifically so provides, the Committee shall not have discretion
to increase the amount of compensation payable under the Award to the
extent such an increase would cause the Award to lose its qualification as
performance-based compensation for purposes of Section 162(m)(4)(C) of the
Code and the regulations thereunder.
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(d) Any Shares distributed pursuant to an Award may consist, in whole
or in part, of authorized and unissued Shares or treasury Shares including
Shares acquired by purchase in the open market or in private transactions.
(5) Specific Terms of Awards.
(a) General. Awards may be granted on the terms and conditions set
forth in this Section 5. In addition, the Committee may impose on any Award
or the exercise thereof, at the date of grant or thereafter (subject to
Section 8(d)), such additional terms and conditions, not inconsistent with
the provisions of the Plan, as the Committee shall determine, including
terms regarding forfeiture of Awards or continued exercisability of Awards
in the event of termination of service by the Eligible Person.
(b) Options. The Committee is authorized to grant Options, which may
be NQSOs or ISOs, to Eligible Persons on the following terms and
conditions:
(i) Exercise Price. The exercise price per Share purchasable
under an Option shall be determined by the Committee; provided,
however, that the exercise price per Share of an Option shall not be
less than the Fair Market Value of a Share on the date of grant of the
Option. Consistent with the foregoing, the Committee may, without
limitation, set an exercise price that is based upon achievement of
performance criteria if deemed appropriate by the Committee.
(ii) Option Term. The term of each Option shall be determined by
the Committee; provided, however, that such term shall not be longer
than ten years from the date of grant of the Option.
(iii) Time and Method of Exercise. The Committee shall determine
at the date of grant or thereafter the time or times at which an
Option may be exercised in whole or in part (including, without
limitation, upon achievement of performance criteria if deemed
appropriate by the Committee), the methods by which such exercise
price may be paid or deemed to be paid (including, without limitation,
broker-assisted exercise arrangements), the form of such payment
(including, without limitation, cash, Shares, notes or other
property), and the methods by which Shares will be delivered or deemed
to be delivered to Eligible Persons; provided, however, that in no
event may any portion of the exercise price be paid with Shares
acquired either under an Award granted pursuant to this Plan, upon
exercise of a stock option granted under another Company plan or as a
stock bonus or other stock award granted under another Company plan
unless, in any such case, the Shares were acquired and vested more
than six months in advance of the date of exercise.
(iv) ISOs. The terms of any ISO granted under the Plan shall
comply in all respects with the provisions of Section 422 of the Code,
including but not limited to the requirement that the ISO shall be
granted within ten years from the earlier of the date of adoption or
shareholder approval of the Plan. ISOs may only be granted to
employees of the Company or a Subsidiary.
(c) SARs. The Committee is authorized to grant SARs (Share
Appreciation Rights) to Eligible Persons on the following terms and
conditions:
7
(i) Right to Payment. An SAR shall confer on the Eligible Person
to whom it is granted a right to receive with respect to each Share
subject thereto, upon exercise thereof, the excess of (1) the Fair
Market Value of one Share on the date of exercise (or, if the
Committee shall so determine in the case of any such right, the Fair
Market Value of one Share at any time during a specified period before
or after the date of exercise) over (2) the exercise price per Share
of the SAR as determined by the Committee as of the date of grant of
the SAR (which shall not be less than the Fair Market Value per Share
on the date of grant of the SAR and, in the case of an SAR granted in
tandem with an Option, shall be equal to the exercise price of the
underlying Option).
(ii) Other Terms. The Committee shall determine, at the time of
grant or thereafter, the time or times at which an SAR may be
exercised in whole or in part (which shall not be more than ten years
after the date of grant of the SAR), the method of exercise, method of
settlement, form of consideration payable in settlement, method by
which Shares will be delivered or deemed to be delivered to Eligible
Persons, whether or not an SAR shall be in tandem with any other
Award, and any other terms and conditions of any SAR. Unless the
Committee determines otherwise, an SAR (1) granted in tandem with an
NQSO may be granted at the time of grant of the related NQSO or at any
time thereafter and (2) granted in tandem with an ISO may only be
granted at the time of grant of the related ISO.
(d) Restricted Shares. The Committee is authorized to grant Restricted
Shares to Eligible Persons on the following terms and conditions:
(i) Issuance and Restrictions. Restricted Shares shall be subject
to such restrictions on transferability and other restrictions, if
any, as the Committee may impose at the date of grant or thereafter,
which restrictions may lapse separately or in combination at such
times, under such circumstances (including, without limitation, upon
achievement of performance criteria if deemed appropriate by the
Committee), in such installments, or otherwise, as the Committee may
determine. Except to the extent restricted under the Award Agreement
relating to the Restricted Shares, an Eligible Person granted
Restricted Shares shall have all of the rights of a shareholder
including, without limitation, the right to vote Restricted Shares and
the right to receive dividends thereon. If the lapse of restrictions
is conditioned on the achievement of performance criteria, the
Committee shall select the criterion or criteria from the list of
criteria set forth in Section 5(f)(i). The Committee must certify in
writing prior to the lapse of restrictions conditioned on achievement
of performance criteria that such performance criteria were in fact
satisfied.
(ii) Forfeiture. Except as otherwise determined by the Committee,
at the date of grant or thereafter, upon termination of service during
the applicable restriction period, Restricted Shares and any accrued
but unpaid dividends or dividend equivalents that are at that time
subject to restrictions shall be forfeited; provided, however, that
the Committee may provide, by rule or regulation or in any Award
Agreement, or may determine in any individual case, that restrictions
or forfeiture conditions relating to Restricted Shares will be waived
in whole or in part in the event of terminations resulting from
specified causes, and the Committee may in other cases waive in whole
or in part the forfeiture of Restricted Shares.
(iii) Certificates for Shares. Restricted Shares granted under
the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Shares are
registered in the name of the Eligible Person, such certificates shall
bear an
8
appropriate legend referring to the terms, conditions, and
restrictions applicable to such Restricted Shares, and the Company
shall retain physical possession of the certificate.
(iv) Dividends. Dividends paid on Restricted Shares shall be
either paid at the dividend payment date, or deferred for payment to
such date as determined by the Committee, in cash or in unrestricted
Shares having a Fair Market Value equal to the amount of such
dividends. Shares distributed in connection with a Share split or
dividend in Shares, and other property distributed as a dividend,
shall be subject to restrictions and a risk of forfeiture to the same
extent as the Restricted Shares with respect to which such Shares or
other property has been distributed.
(e) Restricted Share Units. The Committee is authorized to grant
Restricted Share Units to Eligible Persons, subject to the following terms
and conditions:
(i) Award and Restrictions. Delivery of Shares or cash, as the
case may be, will occur upon expiration of the deferral period
specified for Restricted Share Units by the Committee (or, if
permitted by the Committee, as elected by the Eligible Person). In
addition, Restricted Share Units shall be subject to such restrictions
as the Committee may impose, if any (including, without limitation,
the achievement of performance criteria if deemed appropriate by the
Committee), at the date of grant or thereafter, which restrictions may
lapse at the expiration of the deferral period or at earlier or later
specified times, separately or in combination, in installments or
otherwise, as the Committee may determine. If the lapse of
restrictions is conditioned on the achievement of performance
criteria, the Committee shall select the criterion or criteria from
the list of criteria set forth in Section 5(f)(i). The Committee must
certify in writing prior to the lapse of restrictions conditioned on
the achievement of performance criteria that such performance criteria
were in fact satisfied.
(ii) Forfeiture. Except as otherwise determined by the Committee
at date of grant or thereafter, upon termination of service (as
determined under criteria established by the Committee) during the
applicable deferral period or portion thereof to which forfeiture
conditions apply (as provided in the Award Agreement evidencing the
Restricted Share Units), or upon failure to satisfy any other
conditions precedent to the delivery of Shares or cash to which such
Restricted Share Units relate, all Restricted Share Units that are at
that time subject to deferral or restriction shall be forfeited;
provided, however, that the Committee may provide, by rule or
regulation or in any Award Agreement, or may determine in any
individual case, that restrictions or forfeiture conditions relating
to Restricted Share Units will be waived in whole or in part in the
event of termination resulting from specified causes, and the
Committee may in other cases waive in whole or in part the forfeiture
of Restricted Share Units.
(f) Performance Shares and Performance Units. The Committee is
authorized to grant Performance Shares or Performance Units or both to
Eligible Persons on the following terms and conditions:
(i) Performance Period. The Committee shall determine a
performance period (the "Performance Period") of one or more years and
shall determine the performance objectives for grants of Performance
Shares and Performance Units. Performance objectives may vary from
Eligible Person to Eligible Person and shall be based upon one or more
of the following performance criteria as the Committee may deem
appropriate: appreciation in value of the Shares; total shareholder
return; earnings per share; operating income; net income; pretax
9
earnings; pretax earnings before interest, depreciation and
amortization; pro forma net income; return on equity; return on
designated assets; return on capital; economic value added; earnings;
revenues; expenses; operating profit margin; operating cash flow; free
cash flow; cash flow return on investment; operating margin; net
profit margin; or any of the above criteria as compared to the
performance of a published or special index deemed applicable by the
Committee, including, but not limited to, the Standard & Poor's 500
Stock Index. The performance objectives may be determined by reference
to the performance of the Company, or of a Subsidiary or Affiliate, or
of a division or unit of any of the foregoing. Performance Periods may
overlap and Eligible Persons may participate simultaneously with
respect to Performance Shares and Performance Units for which
different Performance Periods are prescribed.
(ii) Award Value. At the beginning of a Performance Period, the
Committee shall determine for each Eligible Person or group of
Eligible Persons with respect to that Performance Period the range of
number of Shares, if any, in the case of Performance Shares, and the
range of dollar values, if any, in the case of Performance Units,
which may be fixed or may vary in accordance with such performance or
other criteria specified by the Committee, which shall be paid to an
Eligible Person as an Award if the relevant measure of Company
performance for the Performance Period is met. The Committee must
certify in writing that the applicable performance criteria were
satisfied prior to payment under any Performance Shares or Performance
Units.
(iii) Significant Events. If during the course of a Performance
Period there shall occur significant events as determined by the
Committee which the Committee expects to have a substantial effect on
a performance objective during such period, the Committee may revise
such objective; provided, however, that, if an Award Agreement so
provides, the Committee shall not have any discretion to increase the
amount of compensation payable under the Award to the extent such an
increase would cause the Award to lose its qualification as
performance-based compensation for purposes of Section 162(m)(4)(C) of
the Code and the regulations thereunder.
(iv) Forfeiture. Except as otherwise determined by the Committee,
at the date of grant or thereafter, upon termination of service during
the applicable Performance Period, Performance Shares and Performance
Units for which the Performance Period was prescribed shall be
forfeited; provided, however, that the Committee may provide, by rule
or regulation or in any Award Agreement, or may determine in an
individual case, that restrictions or forfeiture conditions relating
to Performance Shares and Performance Units will be waived in whole or
in part in the event of terminations resulting from specified causes,
and the Committee may in other cases waive in whole or in part the
forfeiture of Performance Shares and Performance Units.
(v) Payment. Each Performance Share or Performance Unit may be
paid in whole Shares, or cash, or a combination of Shares and cash
either as a lump sum payment or in installments, all as the Committee
shall determine, at the time of grant of the Performance Share or
Performance Unit or otherwise, commencing as soon as practicable after
the end of the relevant Performance Period. The Committee must certify
in writing prior to the payment of any Performance Share or
Performance Unit that the performance objectives and any other
material terms were in fact satisfied.
10
(g) Other Share-Based Awards. The Committee is authorized, subject to
limitations under applicable law, to grant to Eligible Persons such other
Awards that may be denominated or payable in, valued in whole or in part by
reference to, or otherwise based on, or related to, Shares, as deemed by
the Committee to be consistent with the purposes of the Plan, including,
without limitation, unrestricted shares awarded purely as a "bonus" and not
subject to any restrictions or conditions, other rights convertible or
exchangeable into Shares, purchase rights for Shares, Awards with value and
payment contingent upon performance of the Company or any other factors
designated by the Committee, and Awards valued by reference to the
performance of specified Subsidiaries or Affiliates. The Committee shall
determine the terms and conditions of such Awards at date of grant or
thereafter. Shares delivered pursuant to an Award in the nature of a
purchase right granted under this Section 5(g) shall be purchased for such
consideration, paid for at such times, by such methods, and in such forms,
including, without limitation, cash, Shares, notes or other property, as
the Committee shall determine. Cash awards, as an element of or supplement
to any other Award under the Plan, shall also be authorized pursuant to
this Section 5(g).
(6) Certain Provisions Applicable to Awards.
(a) Stand-Alone, Additional, Tandem and Substitute Awards. Awards
granted under the Plan may, in the discretion of the Committee, be granted
to Eligible Persons either alone or in addition to, in tandem with, or in
exchange or substitution for, any other Award granted under the Plan or any
award granted under any other plan or agreement of the Company, any
Subsidiary or Affiliate, or any business entity to be acquired by the
Company or a Subsidiary or Affiliate, or any other right of an Eligible
Person to receive payment from the Company or any Subsidiary or Affiliate.
Awards may be granted in addition to or in tandem with such other Awards or
awards, and may be granted either as of the same time as or a different
time from the grant of such other Awards or awards. Subject to the
provisions of Section 3(e) hereof prohibiting Option and SAR repricing
without shareholder approval, the per Share exercise price of any Option or
grant price of any SAR which is granted, in connection with the
substitution of awards granted under any other plan or agreement of the
Company or any Subsidiary or Affiliate or any business entity to be
acquired by the Company or any Subsidiary or Affiliate, shall be determined
by the Committee, in its discretion.
(b) Term of Awards. The term of each Award granted to an Eligible
Person shall be for such period as may be determined by the Committee;
provided, however, that in no event shall the term of any Option or SAR
exceed a period of ten years from the date of its grant (or such shorter
period as may be applicable under Section 422 of the Code).
(c) Form of Payment Under Awards. Subject to the terms of the Plan and
any applicable Award Agreement, payments to be made by the Company or a
Subsidiary or Affiliate upon the grant, maturation, or exercise of an Award
may be made in such forms as the Committee shall determine at the date of
grant or thereafter, including, without limitation, cash, Shares, notes or
other property, and may be made in a single payment or transfer, in
installments, or on a deferred basis. The Committee may make rules relating
to installment or deferred payments with respect to Awards, including the
rate of interest to be credited with respect to such payments, and the
Committee may require deferral of payment under an Award if, in the sole
judgment of the Committee, it may be necessary in order to avoid
nondeductibility of the payment under Section 162(m) of the Code.
(d) Nontransferability. Unless otherwise set forth by the Committee in
an Award Agreement, Awards shall be transferable by an Eligible Person only
by will or the laws of descent and distribution (or pursuant to a
Beneficiary designation) and shall be exercisable during the lifetime of an
Eli-
11
gible Person only by such Eligible Person or his guardian or legal
representative. An Eligible Person's rights under the Plan may not be
pledged, mortgaged, hypothecated, or otherwise encumbered, and shall not be
subject to claims of the Eligible Person's creditors.
(7) Change of Control Provisions.
(a) Acceleration of Exercisability and Lapse of Restrictions. Unless
otherwise provided by the Committee at the time of the Award grant, in the
event of a Change of Control, (i) all outstanding Awards pursuant to which
the Participant may have rights the exercise of which is restricted or
limited, shall become fully exercisable at the time of the Change of
Control, and (ii) unless the right to lapse of restrictions is waived by a
Participant prior to such lapse, all restrictions on outstanding Awards
subject to restrictions under the Plan shall lapse, and all performance
criteria and other conditions to payment of Awards under which payments of
cash, Shares or other property are subject to conditions shall be deemed to
be achieved or fulfilled and shall be waived by the Company at the time of
the Change of Control.
(b) Definition of Change of Control. For purposes of this Section 7,
"Change of Control" shall mean:
(i) the acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
"Person"), of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of 20% or more of either (1) the
then outstanding shares of common stock of the Company (the
"Outstanding Company Common Stock") or (2) the combined voting power
of the then outstanding voting securities of the Company entitled to
vote generally in the election of directors (the "Outstanding Company
Voting Securities"); provided, however, that the following
acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Company (other than by exercise of a
conversion privilege); (ii) any acquisition by the Company or any of
its subsidiaries; (iii) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any of
its subsidiaries; (iv) any acquisition by any corporation with respect
to which, following such acquisition, more than 60% of, respectively,
the then outstanding shares of common stock of such corporation and
the combined voting power of the then outstanding voting securities of
such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all
or substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to
such acquisition in substantially the same proportions as their
ownership, immediately prior to such acquisition, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the
case may be; or (v) any acquisition by a Person owning more than 25%
of the Outstanding Company Common Stock on the Effective Date; or
(ii) During any period of two consecutive years, individuals who,
as of the beginning of such period, constitute the Board of Directors
of the Company (the "Incumbent Board"), cease for any reason to
constitute at least a majority of the Board of Directors of the
Company; provided, however, that any individual becoming a director
subsequent to the beginning of such period whose election, or
nomination for election by the Company's shareholders, was approved by
a vote of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding, for this purpose, any
such individual whose initial assumption of office occurs as
12
a result of either an actual or threatened election contest (as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act); or
(iii) approval by the shareholders of the Company of a
reorganization, merger or consolidation, in each case, with respect of
which all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities immediately
prior to such reorganization, merger or consolidation, do not,
following such reorganization, merger or consolidation, beneficially
own, directly or indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting power of
the then outstanding voting securities entitled to vote generally in
the election of directors, as the case may be, of the corporation
resulting from such reorganization, merger or consolidation in
substantially the same proportions as their ownership, immediately
prior to such reorganization, merger or consolidation of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be; or
(iv) approval by the shareholders of the Company of (1) a
complete liquidation or dissolution of the Company or (2) a sale or
other disposition of all or substantially all of the assets of the
Company, other than to the corporation, with respect to which
following such sale or other disposition, more than 60% of,
respectively, the then outstanding shares of common stock of such
corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately
prior to such sale or other disposition, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case
may be.
(8) General Provisions.
(a) Compliance with Legal and Trading Requirements. The Plan, the
granting and exercising of Awards thereunder, and the other obligations of
the Company under the Plan and any Award Agreement, shall be subject to all
applicable federal and state laws, rules and regulations, and to such
approvals by any regulatory or governmental agency as may be required. The
Company, in its discretion, may postpone the issuance or delivery of Shares
under any Award until completion of such stock exchange or market system
listing or registration or qualification of such Shares or other required
action under any state or federal law, rule or regulation as the Company
may consider appropriate, and may require any Participant to make such
representations and furnish such information as it may consider appropriate
in connection with the issuance or delivery of Shares in compliance with
applicable laws, rules and regulations. No provisions of the Plan shall be
interpreted or construed to obligate the Company to register any Shares
under federal or state law.
(b) No Right to Continued Employment or Service. Neither the Plan nor
any action taken thereunder shall be construed as giving any employee or
director the right to be retained in the employ or service of the Company
or any of its Subsidiaries or Affiliates, nor shall it interfere in any way
with the right of the Company or any of its Subsidiaries or Affiliates to
terminate any employee's or director's employment or service at any time.
13
(c) Taxes. The Company or any Subsidiary or Affiliate is authorized to
withhold from any Award granted, any payment relating to an Award under the
Plan, including from a distribution of Shares, or any payroll or other
payment to an Eligible Person, amounts of withholding and other taxes due
in connection with any transaction involving an Award, and to take such
other action as the Committee may deem advisable to enable the Company and
Eligible Persons to satisfy obligations for the payment of withholding
taxes and other tax obligations relating to any Award. This authority shall
include authority to withhold or receive Shares or other property and to
make cash payments in respect thereof in satisfaction of an Eligible
Person's tax obligations; provided, however, that the amount of tax
withholding to be satisfied by withholding Shares shall be limited to the
minimum amount of taxes, including employment taxes, required to be
withheld under applicable Federal, state and local law.
(d) Changes to the Plan and Awards. The Board may amend, alter,
suspend, discontinue, or terminate the Plan or the Committee's authority to
grant Awards under the Plan without the consent of shareholders of the
Company or Participants, except that any such amendment, alteration,
suspension, discontinuation, or termination shall be subject to the
approval of the Company's shareholders to the extent such shareholder
approval is required under Section 422 of the Code; provided, however,
that, without the consent of an affected Participant, no amendment,
alteration, suspension, discontinuation, or termination of the Plan may
materially and adversely affect the rights of such Participant under any
Award theretofore granted to him or her. The Committee may waive any
conditions or rights under, amend any terms of, or amend, alter, suspend,
discontinue or terminate, any Award theretofore granted, prospectively or
retrospectively; provided, however, that, without the consent of a
Participant, no amendment, alteration, suspension, discontinuation or
termination of any Award may materially and adversely affect the rights of
such Participant under any Award theretofore granted to him or her.
(e) No Rights to Awards; No Shareholder Rights. No Eligible Person or
employee shall have any claim to be granted any Award under the Plan, and
there is no obligation for uniformity of treatment of Eligible Persons and
employees. No Award shall confer on any Eligible Person any of the rights
of a shareholder of the Company unless and until Shares are duly issued or
transferred to the Eligible Person in accordance with the terms of the
Award.
(f) Unfunded Status of Awards. The Plan is intended to constitute an
"unfunded" plan for incentive compensation. With respect to any payments
not yet made to a Participant pursuant to an Award, nothing contained in
the Plan or any Award shall give any such Participant any rights that are
greater than those of a general creditor of the Company; provided, however,
that the Committee may authorize the creation of trusts or make other
arrangements to meet the Company's obligations under the Plan to deliver
cash, Shares, other Awards, or other property pursuant to any Award, which
trusts or other arrangements shall be consistent with the "unfunded" status
of the Plan unless the Committee otherwise determines with the consent of
each affected Participant.
(g) Nonexclusivity of the Plan. Neither the adoption of the Plan by
the Board nor its submission to the shareholders of the Company for
approval shall be construed as creating any limitations on the power of the
Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of options and other awards
otherwise than under the Plan, and such arrangements may be either
applicable generally or only in specific cases.
(h) Not Compensation for Benefit Plans. No Award payable under this
Plan shall be deemed salary or compensation for the purpose of computing
benefits under any benefit plan or other arrangement of the Company for the
benefit of its employees or directors unless the Company shall determine
otherwise.
14
(i) No Fractional Shares. No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award. The Committee shall determine
whether cash, other Awards, or other property shall be issued or paid in
lieu of such fractional Shares or whether such fractional Shares or any
rights thereto shall be forfeited or otherwise eliminated.
(j) Governing Law. The validity, construction, and effect of the Plan,
any rules and regulations relating to the Plan, and any Award Agreement
shall be determined in accordance with the laws of New Jersey without
giving effect to principles of conflict of laws thereof.
(k) Effective Date; Plan Termination. The Plan shall become effective
as of March 7, 2002 (the "Effective Date"), subject to approval by
shareholders of the Company. The Plan shall terminate as to future awards
on the date which is ten (10) years after the Effective Date.
(l) Titles and Headings. The titles and headings of the sections in
the Plan are for convenience of reference only. In the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.
Exhibit 5
[Letterhead of Cahill Gordon & Reindel]
May 16, 2002
(212) 701-3000
Engelhard Corporation
101 Wood Avenue
Iselin, New Jersey 08830
Gentlemen:
We have acted as counsel to Engelhard Corporation, a Delaware corporation
(the "Company"), in connection with the filing of a Registration Statement on
Form S-8 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Act"), relating to the registration pursuant to the provisions of
the Act of 6,000,000 shares of common stock, $1.00 par value (the "Common
Stock") of the Company, which are issuable pursuant to awards (the "Awards")
granted and to be granted pursuant to the Company's 2002 Long Term Incentive
Plan (the "Plan").
We advise you that, in our opinion, upon the issuance of Common Stock
pursuant to a duly granted Award in accordance with its terms and the terms of
the Plan, and upon payment to the Company of the Award exercise price for such
Common Stock, if any, in accordance therewith, the Common Stock so issued will
be legally issued, fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement. In giving such consent, we do not consider that we are "experts"
within the meaning of such term as used in the Act or the rules and regulations
of the Securities and Exchange Commission issued thereunder, with respect to any
part of the Registration Statement, including this opinion as an exhibit or
otherwise.
Very truly yours,
/s/ Cahill Gordon & Reindel
-----------------------------------
Cahill Gordon & Reindel
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our report dated January 31, 2002
on Engelhard Corporation and Subsidiaries' consolidated financial statements
included in Engelhard Corporation and Subsidiaries' Form 10-K for the year ended
December 31, 2001 and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
New York, New York
May 14, 2002
Exhibit 24
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and Barry
W. Perry, or either of them individually, his/her true and lawful attorney or
attorneys with substitution and resubstitution, to execute in his/her name,
place or stead in his/her capacity as an officer or director or both of
Engelhard Corporation, a Delaware corporation (the "Company"), a Registration
Statement under the Securities Act of 1933, as amended, on Form S-8 relating to
the Company's 2002 Long Term Incentive Plan and covering shares of the Company's
common stock ($1 par value), any amendments to such Registration Statement
(including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 16,
2002.
/s/ Marion H. Antonini
---------------------------
Marion H. Antonini
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and Barry
W. Perry, or either of them individually, his/her true and lawful attorney or
attorneys with substitution and resubstitution, to execute in his/her name,
place or stead in his/her capacity as an officer or director or both of
Engelhard Corporation, a Delaware corporation (the "Company"), a Registration
Statement under the Securities Act of 1933, as amended, on Form S-8 relating to
the Company's 2002 Long Term Incentive Plan and covering shares of the Company's
common stock ($1 par value), any amendments to such Registration Statement
(including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 16,
2002.
/s/ James V. Napier
------------------------
James V. Napier
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and Barry
W. Perry, or either of them individually, his/her true and lawful attorney or
attorneys with substitution and resubstitution, to execute in his/her name,
place or stead in his/her capacity as an officer or director or both of
Engelhard Corporation, a Delaware corporation (the "Company"), a Registration
Statement under the Securities Act of 1933, as amended, on Form S-8 relating to
the Company's 2002 Long Term Incentive Plan and covering shares of the Company's
common stock ($1 par value), any amendments to such Registration Statement
(including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 16,
2002.
/s/ Norma T. Pace
-----------------------
Norma T. Pace
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and Barry
W. Perry, or either of them individually, his/her true and lawful attorney or
attorneys with substitution and resubstitution, to execute in his/her name,
place or stead in his/her capacity as an officer or director or both of
Engelhard Corporation, a Delaware corporation (the "Company"), a Registration
Statement under the Securities Act of 1933, as amended, on Form S-8 relating to
the Company's 2002 Long Term Incentive Plan and covering shares of the Company's
common stock ($1 par value), any amendments to such Registration Statement
(including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 2,
2002.
/s/ Henry R. Slack
----------------------------
Henry R. Slack
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and Barry
W. Perry, or either of them individually, his/her true and lawful attorney or
attorneys with substitution and resubstitution, to execute in his/her name,
place or stead in his/her capacity as an officer or director or both of
Engelhard Corporation, a Delaware corporation (the "Company"), a Registration
Statement under the Securities Act of 1933, as amended, on Form S-8 relating to
the Company's 2002 Long Term Incentive Plan and covering shares of the Company's
common stock ($1 par value), any amendments to such Registration Statement
(including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 16,
2002.
/s/ Douglas G. Watson
--------------------------
Douglas G. Watson
ENGELHARD CORPORATION
Power of Attorney
WHEREAS, the undersigned hereby appoints Arthur A. Dornbusch, II and
Michael A. Sperduto, or either of them individually, his/her true and lawful
attorney or attorneys with substitution and resubstitution, to execute in
his/her name, place or stead in his/her capacity as an officer or director or
both of Engelhard Corporation, a Delaware corporation (the "Company"), a
Registration Statement under the Securities Act of 1933, as amended, on Form S-8
relating to the Company's 2002 Long Term Incentive Plan and covering shares of
the Company's common stock ($1 par value), any amendments to such Registration
Statement (including post-effective amendments) and all instruments necessary or
incidental in connection therewith, and to file or cause to be filed such
Registration Statement, amendments and other instruments with the Securities and
Exchange Commission, and hereby grants unto said attorneys the full power and
authority to do and perform every act whatsoever necessary or desirable to be
done in the premises, as fully to all intents and purposes as he/she might or
could do in person. The undersigned hereby ratifies and approves the actions of
said attorneys and each of them.
IN WITNESS WHEREOF, the undersigned has executed this instrument on May 3,
2002.
/s/ Barry W. Perry
-----------------------
Barry W. Perry