The Rules Of The Octel Corp. Company Share Option Plan
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EXHIBIT 10.15
THE ASSOCIATED OCTEL COMPANY LIMITED
- and -
OCTEL PROFIT SHARING TRUST CO. LIMITED
TRUST DEED and RULES
of the
OCTEL PROFIT SHARING SHARE SCHEME
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CONTENTS
THIS DEED of TRUST............................................................44
1. DEFINITIONS...........................................................44
1.1 General..........................................................44
1.2 Clause Headings..................................................45
2. TRUSTS OF THE SCHEME..................................................45
2.1 Covenant to pay Amounts due in accordance with the Scheme........45
2.2 Trustee's Covenant to Apply Moneys in Acquisition of Shares......45
2.3 Appropriation in Accordance with Rules of the Scheme.............45
2.4 Holding of Shares pending Distribution...........................46
2.5 Payments of Money or Monies Worth................................46
2.6 Rights Issue in respect of Unappropriated Shares.................46
2.7 Use of Cash Balances.............................................46
2.8 Accounting for Moneys on Termination of the Scheme...............47
3. DIVIDENDS AND OTHER DISTRIBUTIONS.....................................47
4. GROUP COMPANIES.......................................................47
4.1 Addition of New Participating Companies..........................47
4.2 Company ceasing to be a Participating Company....................47
4.3 Provision of Information to Trustee..............................48
4.4 Company acts through Board of Directors..........................48
5. ACQUISITION OF SHARES.................................................48
5.1 Methods by which Shares may be acquired..........................48
5.2 Use of Sums not Applied in Acquisition of Shares.................48
6. ISSUE OF SHARES.......................................................49
6.1 Rights of Shares Subscribed by Trustee...........................49
6.2 Admission to the New York Stock Exchange.........................49
7. RETENTION OF SHARES...................................................49
7.1 No Disposal before Release Date..................................49
7.2 Disposals after Period of Retention and before Release Date......49
7.3 Sale by Participant after Period of Retention....................49
8. VOTING RIGHTS.........................................................50
9. NOTICES AND CIRCULARS.................................................50
9.1 Notices to Participants..........................................50
9.2 Circulars to Shareholders........................................50
10. RIGHTS ISSUES.......................................................50
10.1 Action by Trustee................................................50
10.2 Acquisition of New Shares........................................51
10.3 Trustee Requires Indemnity.......................................51
11. CAPITALISATION ISSUES...............................................51
12. SCRIP DIVIDENDS.....................................................51
12.1 Election by Trustee..............................................51
12.2 Shares shall not be Scheme Shares................................51
12.3 Cash Distribution................................................51
13. RECONSTRUCTIONS AND TAKE-OVERS......................................52
13.1 Participants shall be Notified...................................52
13.2 Consideration consisting of Cash.................................52
13.3 Compulsory Acquisition or Transfer of Shares.....................52
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14. ENTITLEMENTS........................................................52
14.1 Proportionate Allocation of Securities...........................52
14.2 Allocation of Securities forming part of holding of Scheme
Shares...........................................................53
15. INFORMATION.........................................................53
16. TRUSTEE'S POWERS OF DELEGATION......................................53
16.1 Delegation to Professional Person................................53
16.2 Delegation to Other Person or Company............................53
16.3 Revocation of Delegation.........................................53
16.4 Execution of Documents...........................................53
16.5 Deposit of Trust Property........................................54
17. ADMINISTRATION......................................................54
17.1 Trustee's Power to make Regulations..............................54
17.2 Decisions taken by Majority......................................54
17.3 Accounting for Tax...............................................54
17.4 Minimum Number of Trustees.......................................54
18. PROVISIONS RELATING TO THE TRUSTEE..................................55
18.1 Trustee's Indemnity..............................................55
18.2 Trustee's Interests..............................................55
18.3 Banker may be Trustee............................................55
18.4 Charges of Professional Trustee..................................55
18.5 Trustee not precluded from personal investment...................55
18.6 Information Supplied by Company..................................56
19. APPOINTMENT REMOVAL AND RETIREMENT OF TRUSTEES......................56
19.1 Statutory Power Vested in Company................................56
19.2 Power to Appoint Additional Trustees.............................56
19.3 Company Ceasing to Exist.........................................56
19.4 Removal of Trustee...............................................56
19.5 Retirement of Trustee............................................56
19.6 Transfer of Trust Property following Retirement..................57
19.7 Sole Continuing Trustee..........................................57
19.8 Trust Corporation................................................57
20. RESIDENCE OF THE TRUSTEES...........................................57
21. ALTERATIONS.........................................................57
22. TERMINATION.........................................................57
23. GENERAL.............................................................57
23.1 Governing Law....................................................57
23.2 Schedule One.....................................................58
schedule one: the rules.......................................................59
1. DEFINITIONS...........................................................59
2. INVITATIONS TO PARTICIPATE............................................65
2.1 Issue of Invitations.............................................65
2.2 Terms of Agreement...............................................65
2.3 Employee Electing not to Participate.............................66
3. PURCHASE OF SHARES FOR APPROPRIATION..................................66
3.1 Arrangements for Purchasing Shares...............................66
3.2 When Shares may not be Purchased.................................66
4. SUBSCRIPTION OF SHARES FOR APPROPRIATION..............................66
4.1 Arrangements for Subscription for New Shares.....................66
4.2 Timing of Contributions to Trustees..............................67
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5. APPROPRIATION OF SHARES...............................................67
5.1 Number of Appropriations.........................................67
5.2 Method of Appropriation..........................................67
5.3 Proportionate allocation of Shares which do not rank pari passu..68
5.4 Limitation to Relevant Amount....................................68
5.5 Evidence of share ownership......................................68
6. ISSUE OF SHARES.......................................................68
Shares to rank pari passu................................................68
7. DISPOSALS AND PAYMENT.................................................68
7.1 Prohibition on Disposal by Trustee...............................68
7.2 Accounting for Cash Receipts.....................................68
7.3 Accounting by Participating Company..............................69
8. TRANSFER OF LEGAL TITLE...............................................69
8.1 Transfer free of Income Tax......................................69
8.2 Transfer after Period of Retention...............................69
9. STAMP DUTY............................................................69
10. DISPUTES............................................................69
11. RIGHTS ON TERMINATION OF EMPLOYMENT.................................70
12. DUTY TO ACCOUNT FOR PAYE ETC........................................70
12.1 Deduction from Cash Payments.....................................70
12.2 Transfer of Shares prior to Release Date.........................70
12.3 Maintenance of records...........................................70
12.4 Information to Participants......................................70
13. ALTERATIONS.........................................................71
13.1 General Power to Amend Scheme....................................71
13.2 Amendment prior to Inland Revenue approval.......................71
13.3 Amendment subsequent to Inland Revenue approval..................71
13.4 Amendment which adversely affects Participants...................71
14. GENERAL.............................................................71
SCHEDULE TWO: NOTICE OF APPROPRIATION.........................................72
SCHEDULE THREE: DEED OF ADHERENCE.............................................74
SCHEDULE FOUR: INVITATION LETTER..............................................76
SCHEDULE FIVE: PARTICIPATION AGREEMENT........................................77
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THIS DEED of TRUST
is made the day of 1999
BETWEEN
1 The Associated Octel Company Limited whose registered office is situated
at Suite 2, 4th Floor, Berkeley Square House, Berkeley Square, London,
W1X 6DT ("the Company") and
2 Octel Profit Sharing Trust Co. Limited, whose registered office is
situated at Suite 2, 4th Floor, Berkeley Square House, Berkeley Square,
London, W1X 6DT ("the Trustee" which expression shall where the context
so permits include the trustee or trustees for the time being hereof).
WHEREAS
A The Company is incorporated in England and Wales;
B The Company wishes to establish a profit sharing share scheme to be
approved in accordance with the provisions of Schedule 9 of the Income
and Corporation Taxes Act 1988 (as amended) for the purposes of providing
funds to the Trustee to enable shares in the capital of the Company's
ultimate parent, Octel Corp. to be acquired by the Trustee and to be
appropriated to employees and directors of the Participating Companies
(as hereinafter defined) in accordance with the Rules of the Scheme;
C THE terms of the said Employee Share Trust (which are contained in this
Deed) have been approved by resolution of the Company dated 17 February
1999;
D THE Trustee has agreed to be the first trustee of the Scheme.
NOW THIS DEED WITNESSES as follows:
1. DEFINITIONS
1.1 General
In this Deed:
a references to any statute or statutory instrument or to any part
or parts thereof include any modification, amendment or
re-enactment thereof for the time being in force; and
b references to any deed, agreement, document or instrument
(including this Deed) shall be construed as a reference to such
deed, agreement, document or instrument as from time to time
amended, supplemented or varied; and
c where the context permits words of the masculine gender shall
include the feminine and vice versa and words in the singular
shall include the plural and vice versa.
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d unless the context otherwise requires words and expressions
defined in Schedule One shall have the same meaning in the other
parts of this Deed and references to "Clauses" shall mean clauses
of this Deed and references to "Rules" in this Deed and in
Schedule One shall mean the rules set out in Schedule One.
1.2 Clause Headings
The Clause headings in this Deed are included for reference purposes only
and do not affect its interpretation wherever they may appear.
2. TRUSTS OF THE SCHEME
2.1 Covenant to pay Amounts due in accordance with the Scheme
The Company and the Participating Companies hereby covenant with the
Trustee to pay to the Trustee in accordance with and subject to the
provisions of the Scheme the amounts due from it for the purposes of the
subscription for or purchase of Shares by the Trustee to be appropriated
under the Scheme to the Participants employed by it together with any
other amounts required to cover any costs, charges, and expenses incurred
in such subscription or purchase and any other expenses and charges
incurred by the Trustee in the establishment, operation and determination
of the Scheme. Each Participating Company shall be separately liable to
fund only the amount necessary to purchase Shares to be appropriated to
the Participants specifically employed by it.
2.2 Trustee's Covenant to Apply Moneys in Acquisition of Shares
Subject as hereinafter provided, the Trustee hereby covenants with the
Company to apply the moneys received pursuant to Clause 2.1 in the
subscription for or purchase of Shares and to hold the same, once
appropriated, and all other trust property deriving therefrom, UPON TRUST
for the Participants respectively entitled thereto, subject to the Rules
of the Scheme.
2.3 Appropriation in Accordance with Rules of the Scheme
As soon as reasonably practicable after the acquisition of Shares by it
pursuant to the Scheme the Trustee shall appropriate the Shares so
acquired to the Participants in accordance with the Rules of the Scheme
and shall as soon as reasonably practicable thereafter notify each
Participant in writing in the form (or substantially in the form) of
Schedule Two of the description and number of Shares so appropriated to
him, the date of the appropriation and the Initial Market Value of the
Shares.
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2.4 Holding of Shares pending Distribution
If, in the case of any acquisition of Shares under the Scheme, it is not
possible to appropriate all the Shares without fractional entitlements
arising in respect of individual Participants or, if for any other reason
the Trustee holds Shares for the purpose of the Scheme which are not to
be appropriated, the Trustee may hold so many of the Shares as the
Company shall direct for a period not exceeding 18 months from the
relevant date of acquisition and the Trustee may sell the Shares if they
cannot be appropriated within that period.
2.5 Payments of Money or Monies Worth
Subject to their obligations under paragraph 7 of Schedule 10 to the Act
and to any such direction as is mentioned in paragraph 4(2) of that
Schedule the Trustee:
a shall pay over to the Participant any money or money's worth
received by them in respect of or by reference to any of his
Shares other than money's worth consisting of new shares within
the meaning of paragraph 5 of Schedule 10 to the Act; and
b the Trustee shall deal only pursuant to a direction given by or on
behalf of the Participant or any person in whom the beneficial
interest in his Shares is for the time being vested with any right
conferred in respect of any of his Shares to be allotted shares,
securities or rights of any description.
2.6 Rights Issue in respect of Unappropriated Shares
If, prior to the appropriation of any Shares under the Scheme, the
Trustee becomes entitled in respect of those Shares to any rights to be
allotted or to subscribe for further securities (other than an issue of
bonus shares of the same class as Shares then held by the Trustee pending
any such appropriation, which bonus shares shall be retained by the
Trustee and shall form part of the Shares to be appropriated among the
Participants on the relevant Appropriation Day) the Trustee may exercise
those rights or sell those rights for the best consideration in money
reasonably obtainable at the time.
2.7 Use of Cash Balances
The Trustee shall hold:
a any unused cash balances arising under Clause 2.2;
b the net proceeds of any sale made pursuant to Clauses 2.4 and 2.5;
c any income therefrom;
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d any dividends received in respect of any unappropriated Shares
held under the Scheme; and
e any Capital Receipt of less than (pound)1 otherwise distributable
to a particular Participant
UPON TRUST to apply the same in or towards any reasonable expenses of
administering and determining the Scheme (including any provision for
taxation for which the Trustee is liable) and the Trustee shall notify
the Company on request of the amounts so held by it. The Trustee shall
not be under any duty to invest any moneys of which it stands possessed
under this Clause.
2.8 Accounting for Moneys on Termination of the Scheme
Upon the termination of the Scheme for whatever reason the Trustee shall
sell all unappropriated Shares and thereupon account (so far as
practicable) to the Company and to any Participating Companies for any
moneys held by it as far as is practicable in the same proportions as
they were provided or as may otherwise be appropriate.
3. DIVIDENDS AND OTHER DISTRIBUTIONS
As soon as practicable following their receipt of any dividends or other
distributions in respect of Scheme Shares, the Trustee shall pay and
account for such dividends or other distributions to the Participants
concerned, in accordance with their respective entitlements.
4. GROUP COMPANIES
4.1 Addition of New Participating Companies
The Scheme may, with the consent of the Directors and after notification
to the Inland Revenue, be extended to any company which is under the
Control of the Company not a party to this Deed by the adherence of such
company to the provisions of the Scheme by a deed supplemental hereto, in
the form of Schedule Three, amended as may be thought necessary by the
Company and the Trustee and thereupon the provisions of the Scheme and of
this Deed shall apply to such company as though it were a party to this
Deed.
4.2 Company ceasing to be a Participating Company
The Scheme shall cease to apply to any Participating Company other than
the Company at any time when:
a such company ceases to be under the Control of the Company; or
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b a notice is served by the Company upon the Trustee that the Scheme
shall cease to apply to such company provided that the conditions
specified in paragraph 2(3) of Schedule 9 to the Act continue to
be satisfied;
but any Shares previously appropriated to employees of any such
Participating Company shall be unaffected.
4.3 Provision of Information to Trustee
If, and so long as, the Scheme applies to any Participating Company, such
company shall provide the Trustee with all information required from it
for the purposes of the administration and determination of the Scheme
and shall do so in such form as the Trustee shall reasonably require and
the Trustee shall in good faith rely on such information without further
enquiry.
4.4 Company acts through Board of Directors
If, and so long as, the Scheme applies to any Participating Company the
powers and discretions exercisable by such company in relation to the
Scheme shall be exercisable by resolution of its board of directors or a
duly appointed committee thereof and a minute of any resolution thereof
signed by the secretary or a director of such company shall be sufficient
authority for the Trustee to act.
5. ACQUISITION OF SHARES
5.1 Methods by which Shares may be acquired
Shares to be used under the Scheme may be acquired by the Trustee by way
of:
a subscription; or
b purchase including from Participants; or
c a rights or capitalisation issue in respect of Shares which have
been acquired by the Trustee and have not been appropriated under
the Scheme.
5.2 Use of Sums not Applied in Acquisition of Shares
Any sums paid by a Participating Company to the Trustee pursuant to
Clause 2.1 shall if not applied for the purposes of the Scheme within
nine months from the date of such payment be used to cover the Trustee's
incidental costs and expenses or be repaid promptly to that company.
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6. ISSUE OF SHARES
6.1 Rights of Shares Subscribed by Trustee
All Shares subscribed for by the Trustee pursuant to the Scheme shall as
to voting, dividend, transfer and other rights (including those arising
on a liquidation) rank pari passu except that they will not rank for any
dividend or other rights declared by reference to a record date preceding
the date of such subscription.
6.2 Admission to the New York Stock Exchange
If, and so long as, the Shares which are to be issued are of the same
class as shares which are traded on The New York Stock Exchange, the
Company shall use its best endeavours to procure that as soon as
practicable after the allotment of any Shares to the Trustee pursuant to
the Scheme, application shall be made to The New York Stock Exchange for
permission to deal in those Shares unless such application has already
been made.
7. RETENTION OF SHARES
7.1 No Disposal before Release Date
The Trustee shall not dispose of any Scheme Shares held on behalf of a
Participant before the Release Date during the applicable Period of
Retention except in accordance with a direction of such Participant (or
his personal representatives) in the event of a Reconstruction or
Take-over affecting such shares.
7.2 Disposals after Period of Retention and before Release Date
The Trustee shall not dispose of any Scheme Shares held on behalf of a
Participant (other than in accordance with a direction given by a
Participant or his personal representatives in the event of a
Reconstruction or Take-over affecting his Scheme Shares) after the end of
the applicable Period of Retention and before the Release Date except:
a at the written direction of such Participant or any other person
in whom the beneficial interest is vested by law; and
b by a transaction which would not involve a breach of paragraphs
2(2)(c) and (d) of Schedule 9 to the Act.
7.3 Sale by Participant after Period of Retention
After the applicable Period of Retention and before the Release Date
nothing shall prevent a Participant from selling his beneficial interest
in his Scheme Shares to the Trustee for the same consideration as in
accordance with Clause 7.2b would be required to be obtained on a sale of
such Shares to a third party.
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8. VOTING RIGHTS
In respect of any Scheme Shares the Trustee shall upon any matter in
relation to which at a general meeting of the Relevant Company or at any
class meeting they are entitled to exercise any voting rights attaching
thereto vote in such way as the Trustee, in its discretion considers to
be in the interests of the Participants as a whole. The Trustee shall not
exercise any voting rights in respect of any unappropriated Shares
acquired by it pursuant to the Scheme.
9. NOTICES AND CIRCULARS
9.1 Notices to Participants
Notices or documents which the Trustee is required or may desire to give
to any Eligible Employee or Participant shall either be delivered to him
by hand or sent to him by post at his last known home or business address
according to information provided by him to the relevant Participating
Company. Notices sent by post shall be deemed to have been given on the
day following the date of posting.
9.2 Circulars to Shareholders
The Company shall make available to Participants copies of all circulars
and documents sent by it to the holders of its Shares and if and for so
long as the Company is not the Relevant Company shall use all reasonable
endeavours to procure that all circulars and documents sent by the
Relevant Company to its ordinary shareholders shall be made available to
Participants.
10. RIGHTS ISSUES
10.1 Action by Trustee
Whenever any rights to acquire shares or other securities or other rights
of any nature are granted by the Relevant Company in respect of Scheme
Shares the Trustee shall act in the best interests of the Participants in
deciding whether:
a (subject to the provision by him of funds) to take up the rights
on behalf of the Participants; or
b to sell the rights (in whole or in part); or
c to allow the rights to lapse; or
d to sell rights nil paid to the extent necessary to enable the
Trustee to subscribe in full for the balance of any unsold rights.
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10.2 Acquisition of New Shares
Any New Shares (within the meaning of paragraph 5 of Schedule 10 of the
Act) taken up by the Trustee on behalf of any Participant under this
Clause shall subject to Clause 14 form part of the Participant's Scheme
Shares and shall be deemed to have been acquired or appropriated at the
same time as the Scheme Shares to which they relate.
10.3 Trustee Requires Indemnity
Nothing in this Clause shall require the Trustee to act in any manner
whereby they would be involved in any liability unless indemnified to
their satisfaction by the Participant in question against such liability.
In the exercise of any discretion conferred upon it the Trustee shall not
be liable for any loss to any Participant arising by reason of any matter
or thing other than wilful fraud or wrongdoing on the part of the
relevant trustee sought to be made liable.
11. CAPITALISATION ISSUES
Where the Relevant Company allots any New Shares (within the meaning of
paragraph 5 of Schedule 10 of the Act) by way of capitalisation to the
Trustee in respect of any Scheme Shares held by it such New Shares shall
subject to and in accordance with Clause 14 form part of such Scheme
Shares and shall be deemed to have been acquired or appropriated at the
same time as the Scheme Shares in respect of which they are allotted.
12. SCRIP DIVIDENDS
12.1 Election by Trustee
Whenever the Relevant Company offers to the holders of any Scheme Shares
the right to elect to receive Shares wholly or partly in lieu of a cash
dividend the Trustee shall act in the best interests of the Participants
in electing whether to receive cash or Shares in respect of such
dividend.
12.2 Shares shall not be Scheme Shares
Any Shares taken up by the Trustee on behalf of any Participant under
this Clause shall not form part of the Scheme Shares to which they relate
but shall be registered in the name of the relevant Participant.
12.3 Cash Distribution
In so far as any dividend or other distribution consists of cash it shall
belong to the Participants concerned and be paid to them in accordance
with Clause 3.
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13. RECONSTRUCTIONS AND TAKE-OVERS
13.1 Participants shall be Notified
Participants shall be notified of any Reconstruction or Take-over and any
Participant may give notice in writing to the Trustees instructing them
in respect of any of his Scheme Shares (and where appropriate exercising
any right to elect to receive any particular form of consideration
available thereunder).
13.2 Consideration consisting of Cash
To the extent the consideration received by virtue of any Reconstruction
or Take-over consists of cash it shall be treated as the proceeds of a
disposal under Clause 7.2 and so far as it consists of New Shares (within
the meaning of paragraph 5 of Schedule 10 of the Act) it shall be held by
the Trustee as Scheme Shares subject to the terms of this Deed and the
Rules of the Scheme mutatis mutandis as if the same were the Scheme
Shares in respect of which they are issued or which they otherwise
represent.
13.3 Compulsory Acquisition or Transfer of Shares
In the event of any Scheme Shares being compulsorily acquired or Scheme
Shares are transferred to another company or cancelled for a
consideration consisting of cash and/or shares the Participants concerned
shall receive notification thereof from the Trustees as soon as
practicable after such acquisition transfer or cancellation. The Trustee
shall act in the best interests of the Participants in electing whether
to receive cash or Shares in respect of such consideration and the
provisions of this Clause and Clause 14 shall apply mutatis mutandis.
14. ENTITLEMENTS
14.1 Proportionate Allocation of Securities
Where in respect of Shares of the same class as the Scheme Shares an
offer or invitation is made conferring rights to acquire against payment
additional securities in the Relevant Company or where new securities by
way of capitalisation are to be allotted by such company the Trustee
shall allocate such rights or securities amongst the Participants
concerned on a proportionate basis and if such allocation shall give rise
to a fraction of a right or a security shall round such allocation down
to the next whole right or security and the Trustee shall use its best
endeavours to sell any rights or securities which are not allocated and
distribute the net proceeds of sale (after deducting therefrom any
expenses of sale and any taxation which may be payable by the Trustee in
respect thereof) among the Participants whose allocation was rounded down
such proceeds being treated as a Capital Receipt in accordance with
Section 186(3) of the Act provided that any sum of less than (pound)1
otherwise distributable to a particular Participant may be retained by
the Trustee.
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14.2 Allocation of Securities forming part of holding of Scheme Shares
In any circumstances in which the Trustee receives new securities which
are deemed to form part of a holding of Scheme Shares the Trustee shall
allocate the securities to the Participant by reference to the relevant
dates of appropriation or acquisition of the Scheme Shares to which they
relate and if any such allocation should give rise to a fraction of a
security the Trustee shall subject to the Act round such allocation up or
down to the next whole security.
15. INFORMATION
The Trustee shall maintain such records as may be necessary to comply with the
Act and shall at all times and from time to time give to each Participant such
information as shall be in its possession to enable him to determine and
quantify any liability he may have to income tax under Schedule E by reason of
any Relevant Event.
16. TRUSTEE'S POWERS OF DELEGATION
16.1 Delegation to Professional Person
In the exercise of its discretions and the performance of its duties
hereunder the Trustee may employ and pay a registrar, solicitor, broker,
actuary, accountant, banker or other adviser and may appoint any such
person as its agent to transact all or any business and may act on the
advice or opinion of any such solicitor, broker, actuary, accountant,
banker or other adviser and shall not be responsible for anything done or
omitted to be done or suffered in good faith in reliance on such advice
or opinion.
16.2 Delegation to Other Person or Company
Except as otherwise provided by Section 186 and Schedules 9 and 10 to the
Act the Trustee may delegate any of their powers and duties hereunder or
any business including the exercise of any discretion to any person or
company including any Participating Company.
16.3 Revocation of Delegation
The Trustee may at any time and shall if so directed by the Company
revoke any delegation or arrangement made under this Clause and require
any trust property held by another person to be returned to the Trustee.
16.4 Execution of Documents
The Trustee may execute or sign or appoint an attorney to excute or sign
and may authorise any of its directors, officers or employees on its
behalf to effect the execution or signature of any deeds, documents,
cheques or other instruments by the impression of any signature on behalf
of or as witness of any sealing by the Trustee in writing, printing,
lithography, photocopying or any other mode of representing or
reproducing words in a visible form. Any such signature or sealing shall
constitute due execution by the Trustee.
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16.5 Deposit of Trust Property
The Trustee may at any time cause any part of the trust property to be
deposited for safekeeping with any person on behalf of the Trustee and
may pay any expenses in connection therewith.
17. ADMINISTRATION
17.1 Trustee's Power to make Regulations
Subject to, and in accordance with, the provisions of this Deed,
including Schedule One, the Trustee may make such regulations as it
considers appropriate relating to the administration of the Scheme.
17.2 Decisions taken by Majority
The directors of the Trustee shall meet together as may be necessary for
the administration of the trusts hereof and all decisions taken by a
majority (or as a result of the casting vote of any chairman appointed by
the directors of the Trustee present at the meeting) of the directors of
the Trustee present at any meeting of the board of the Trustee of which
notice has been given to all of them present in the United Kingdom
(provided at least two directors shall be present) shall be as effective
for all purposes as if such decisions had been unanimous decisions of all
the directors. A written resolution signed by all the directors arrived
at without any meeting shall be effective for all purpose. Nothing herein
shall preclude a sole director from acting on its own.
17.3 Accounting for Tax
The Trustee shall arrange for the relevant Participating Companies to
account to the Inland Revenue or other authority concerned for any
amounts deducted from payments made pursuant to the Scheme in respect of
income tax or any other deductions required in accordance with paragraph
7 of Schedule 10 to the Act. Where there is no relevant Participating
Company in respect of a Participant the Trustee shall account to the
Inland Revenue or other authority concerned for any amounts of income tax
or any other deductions required to be made in accordance with paragraph
7 to Schedule 10 of the Act.
17.4 Minimum Number of Trustees
The number of trustees of the Scheme shall not be less than two persons
unless a company is appointed as sole trustee and if at any time the
number of trustees shall fall below such limits the surviving or
continuing trustees shall have power to act only for the purpose of doing
all things necessary to concur in or secure the appointment of a new
trustee or trustees.
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18. PROVISIONS RELATING TO THE TRUSTEE
18.1 Trustee's Indemnity
The Company shall pay to or reimburse the Trustee or its directors, as
appropriate, upon demand for all charges and expenses reasonably incurred
by it or them in the course of the administration and determination of
the trusts of this Deed and of the Scheme and shall keep the estates and
effects of the Trustee's directors fully indemnified and saved harmless
against all actions, claims, losses, demands, proceedings, charges,
expenses, costs, damages, taxes, duties and other liabilities arising out
of anything done or caused to be done by them or suffered or incurred by
them in the exercise or purported exercise of any of the powers and
discretions vested in them by this Deed and the Scheme or otherwise
howsoever arising out of or in connection with the preparation,
administration, operation, or termination of the Scheme but so that no
director shall be indemnified or exonerated in respect of any fraud or
wilful default on his part and in addition the Trustee shall have the
benefit of all indemnities conferred upon trustees generally by law and
by the Trustee Act 1925.
18.2 Trustee's Interests
A person shall not be disqualified from acting as director of the trustee
hereof or exercising any power vested in the Trustee by reason of the
fact that he is or has been a director or employee of any Participating
Company or is participating in or has participated in the Scheme or for
any remuneration or other benefit received thereby or in connection
therewith.
18.3 Banker may be Trustee
Any bank which is banker to any Participating Company may act as trustee
without being required to account for any profit resulting therefrom.
18.4 Charges of Professional Trustee
Any person acting as a director of the trustee in the course of any
profession or business carried on by him may charge and be paid such
reasonable remuneration charges or disbursements whether in connection
with the Scheme or otherwise as shall from time to time be agreed between
him and the Company.
18.5 Trustee not precluded from personal investment
No director or officer of a body corporate or a trust corporation acting
as a trustee shall on his own account be precluded from acquiring,
holding, or dealing with any debentures, debenture stock, shares or
securities whatsoever of the Company or any other company in the shares
of which the Company may be interested or from entering into any contract
or other transaction with the Company or any such other company or from
being interested in any such contract or transaction and nor shall he be
in any way liable to
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THE OCTEL PROFIT SHARING SHARE SCHEME
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account to the Company, or any Participant in the Scheme for any profits
made fees, commissions, shares of brokerage, discounts allowed or
advantages obtained by him from or in connection with such acquisition,
holding, dealing, contract or transaction whether or not in connection
with his duties hereunder.
18.6 Information Supplied by Company
The Trustee shall be entitled in the absence of manifest error to rely
without further enquiry on information supplied to them by the Company
for the purposes of the Scheme and shall also be entitled to rely in the
absence of manifest error on any direction, notice or document purporting
to be given or executed by or with the authority of the Company or by any
Participant in the Scheme as having been so given or executed.
19. APPOINTMENT REMOVAL AND RETIREMENT OF TRUSTEES
19.1 Statutory Power Vested in Company
The statutory power of appointing new and additional trustees shall be
vested in the Company, which may at any time by writing under hand of a
person duly authorised by a resolution of the Directors appoint a new
trustee including a corporate trustee.
19.2 Power to Appoint Additional Trustees
In addition to the said statutory power the Company shall have power at
any time by deed to appoint any person to be an additional trustee hereof
notwithstanding that the effect of such appointment would be to increase
the number of trustees hereof beyond four.
19.3 Company Ceasing to Exist
All powers of appointment and removal shall be vested in the Trustee in
the event that the Company ceases to exist otherwise than in consequence
of a reconstruction or amalgamation.
19.4 Removal of Trustee
The Company may at any time by writing under hand of a person duly
authorised by a resolution of the directors remove a trustee from office
(but not so as to leave in office fewer than two trustees unless a
corporate trustee) without assigning any reason therefor and such removal
shall (in the absence of any other date specified in the notice) take
place forthwith.
19.5 Retirement of Trustee
A trustee may retire by giving to the Company written notice of his
desire to retire and such notice shall take effect at the expiry of three
months (or such other period as may be agreed with the Company) from the
date of such notice. The trustee shall not be obliged and shall not be
responsible for any costs occasioned by such retirement but shall execute
all such documents and do all such things as may be necessary to give
proper effect to such retirement.
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19.6 Transfer of Trust Property following Retirement
Forthwith upon his removal or retirement a trustee shall transfer all
trust property held by him and deliver all documents in his possession
relating to the Scheme to the remaining trustees (if any) or otherwise as
the Company may direct.
19.7 Sole Continuing Trustee
After such removal or retirement as is mentioned in Clauses 19.4 or 19.5
a sole trustee (whether or not a trust corporation) may continue to act
as a trustee in all respects but so that if after such removal or
retirement there shall be no continuing trustee the Company shall
forthwith appoint a new trustee in place of such removed or retired
trustee.
19.8 Trust Corporation
The provisions of Sections 37 and 39 of the Trustee Act 1925 shall apply
hereto as if all references therein to a trust corporation were
references to any company authorised to undertake trust business.
20. RESIDENCE OF THE TRUSTEES
If there is more than one trustee at least one of their number shall at
all times be resident in the United Kingdom for United Kingdom tax
purposes. If there is only one trustee it shall be a body corporate
(which in accordance with Clause 19.8 need not be a trust corporation) at
all times resident in the United Kingdom for United Kingdom tax purposes.
21. ALTERATIONS
The Company may at any time (with the concurrence of the Trustee) by deed
supplemental hereto alter any of the provisions of this Deed (including
the Schedules hereto) in accordance with Rule 13.
22. TERMINATION
No appropriation of shares under the Scheme may be made later than
seventy-six years after the date of this Deed and the perpetuity period
applicable to this Deed shall be eighty years.
23. GENERAL
23.1 Governing Law
This Deed shall be governed by and construed in accordance with the laws
of England and Wales.
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23.2 Schedule One
Schedule One shall have effect as part of this Deed.
IN WITNESS whereof this document has been executed and delivered as a deed the
day and year first above mentioned.
RULES OF OCTEL PROFIT SHARING SHARE SCHEME
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SCHEDULE ONE: THE RULES
1. DEFINITIONS
In these Rules, the following words and expressions shall, where the context so
permits, have the meanings set forth below:
"Accounting Period" any period as the Directors may from time to
time determine, being the period for which the
audited accounts of the Company are made up;
the "Act" the Income and Corporation Taxes Act 1998;
"Agreement" a letter in the form (or substantially in the
form) of Schedule Five;
the "Appropriate Percentage" in relation to Scheme Shares shall be determined
as follows according to the time of the Relevant
Event:
(1) subject to (2) below, if the Relevant
Event occurs before the third
anniversary of the relevant
Appropriation Day, 100 %;
(2) if the Relevant Event occurs before
the third anniversary of the relevant
Appropriation Day and the Relevant
Participant either:
(a) ceases to be a director or
employee of any Participating
Company by reason of injury
disability or redundancy with
in the meaning of the
Employment Rights Act 1996; or
(b) reaches age 65, 50 %;
"Appropriation Day" a day determined by the Directors (and agreed in
advance with the Trustee) as the day on which
Shares are to be appropriated to Participants in
accordance with this Scheme;
"Capital Receipt" in relation to the Scheme Shares of a
Participant, any money or money's worth which
the Trustee or the Participant become entitled
to receive, save to the extent that it is
disregarded pursuant to the provisions of
Section 186(3) of the Act;
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the "Company" The Associated Octel Company Limited, registered in
England and Wales (registered number 344359);
"Continuous Employment" the meaning ascribed by Section 211 of the
Employment Rights Act 1996;
"Control" means the power of a person to secure
(a) by means of the holding of shares or the
possession of voting power in relation to
any body corporate; or
(b) by virtue of any powers conferred by the
articles of association or other document
regulating any body corporate,
that the affairs of a body corporate are conducted
in accordance with the wishes of that person;
"Dealing Day" a day on which The New York Stock Exchange is open
for the transaction of business;
the "Deed" the Trust Deed constituting, inter alia, this Scheme
as amended from time to time;
the "Directors" the board of directors of the Company, or a duly
authorised committee thereof;
"Eligible Employee" any person (other than one who has served notice
under Rule 2.3 that he does not wish to participate
in the proposed appropriation) who on the applicable
Appropriation Day:
(1) is a Full Time Director or employee of a
Participating Company and:
(a) is chargeable to tax in respect of
his office or employment under Case
I of Schedule E of the Act; and
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(b) on the immediately preceding
Qualifying Date had such period of
Continuous Employment with any one or
more Participating Companies (taken
consecutively) as the Directors may
determine provided, being a period not
exceeding five years in total ending on
the relevant Appropriation Date; or
(2) is a former employee who ceased employment
with a Participating Company in the preceding
eighteen months whom the Directors may in
their absolute discretion permit to
participate; or
(3) would be eligible to participate under (1)
above save that he is not chargeable to tax
under Case I of Schedule E of the Act but
whom the Directors may in their absolute
discretion permit to participate;
PROVIDED THAT:
(A) a person who at the relevant Qualifying Date
is absent due to pregnancy or confinement
(and who immediately prior to such absence
satisfied the criteria set out in paragraph
(1) above) shall be treated as an employee on
the relevant Qualifying Date provided that
the employment during such pregnancy or
confinement shall be taken to be part of the
required period of Continuous Employment with
any one or more Participating Companies; and
(B) a person who is ineligible to participate by
virtue of paragraphs 8 or 35 of Schedule 9 to
the Act shall not be treated as an Eligible
Employee;
"Full Time Director" a Director who is contracted to work at least 25 hours
per week (exclusive of meal breaks) (or such lower
number of hours per week as the Directors may determine
from time to time in their absolute discretion) for any
one or more of the Participating Companies;
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"Initial Market Value" (1) save as mentioned in (2) below, the value
of a Share immediately before the
relevant Appropriation Day determined in
accordance with Part VIII of the Taxation
of Chargeable Gains Act 1992 and agreed
in advance with the Shares Valuation
Division of the Inland Revenue; or
(2) in relation to appropriations of Shares
quoted on the New York Stock Exchange,
their value determined by reference to
the average cost to the Trustees
(exclusive of all incidental expenses) of
all Shares acquired during the following
periods:
(a) in respect of subscribed Shares (if any)
in the period of 30 days immediately
preceding the relevant Appropriation Day
provided that such shares shall only be
subscribed at a price which is equivalent
to the middle market quotation for such
Shares as derived from the Wall Street
Journal for the Dealing Day preceding
subscription; and
(b) in respect of purchased Shares (if any)
the period of 60 days immediately
preceding the relevant Appropriation Day.
"Invitation" a letter of offer in the form (or substantially the
form) of Schedule Four;
"Locked-In Value" in relation to any Scheme Shares, shall be
construed in accordance with Section 186(5) of the
Act, being at the date of the Deed:
(1) the Initial Market Value of the Scheme
Shares; or
(2) in the event that the Participant has by
virtue of Section 186(3) of the Act
become chargeable to income tax on a
percentage of the amount or value of any
Capital Receipt in respect of the Scheme
Shares, the amount by which the Initial
Market Value of the Scheme Shares exceeds
the amount or value of such percentage of
such Capital Receipt or, if there has
been more than one Capital Receipt, the
aggregate of them;
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"Participant" an Eligible Employee to whom Scheme Shares are
appropriated in accordance with this Scheme (or,
where the context admits, his personal
representatives);
"Participating Company" the Company and any other company for the time
being designated as a Participating Company being a
company which is under the Control of the Company;
"Period of Retention" in relation to Scheme Shares, the period beginning
on the date on which they are appropriated to a
Participant and ending on whichever is the earliest
of:-
(1) the second anniversary of such date;
(2) the date on which such Participant ceases
to be a director or employee of any
Participating Company by reason of injury
disability or redundancy within the
meaning of the Employment Rights Act
1996;
(3) the date on which such Participant
reaches age 65; and
(4) the date of such Participant's death;
"Qualifying Corporate Bond" has the meaning attributed by Section 117 of the
Taxation of Chargeable Gains Act 1992;
"Qualifying Date" a date as the Directors may from time to time
determine (or, in the absence of any such
determination, the last day of the Company's
accounting period) in the period of one year
immediately preceding the relevant Appropriation
Day;
"Qualifying Remuneration" in relation to any Participant shall mean his total
earnings from the Company and any Participating
Company for the Year of Assessment immediately
preceding the Appropriation Day;
"Reconstruction and Take- a transaction affecting any Scheme Shares which:
over"
(1) is an offer for those Scheme Shares which
if accepted, would result in a new
holding of shares being equated with such
Scheme Shares for the purposes of capital
gains tax; or
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(2) is entered into pursuant to a scheme of
arrangement or a compromise applicable to
or affecting:-
(a) all the issued ordinary share
capital of the Relevant Company or,
as the case may be, all of it that
is of the class in question; or
(b) all the shares, or shares of the
class in question, which are held by
a class of shareholders identified
otherwise than by reference to their
employment or their participation in
an approved profit sharing scheme
approved by the Inland Revenue under
the Act; or
(3) is an offer of cash (with or without other
assets) where the offer forms part of a
general offer which is made to the holders
of shares of the same class in the
Relevant Company and which is made in the
first instance on a condition such that if
it is satisfied the offer or will have
control (within the meaning of Section 416
of the Act); or
(4) is an offer of a Qualifying Corporate
Bond, whether alone or with cash or other
assets or both where the offer forms part
of a general offer which is made as
mentioned in paragraph (3) above;
"Redundancy" the meaning ascribed by the Employment Rights Act
1996;
"the Release Date" the meaning ascribed by Section 187(2) of the Act;
"the Relevant Amount" in relation to a Participant, an amount equal to 10%
of his salary (or, if greater, (pound)3,000) subject
to a maximum of (pound)8,000; "salary" for this
purpose shall have the meaning ascribed by Section
187(5) of the Act for the current or preceding Year
of Assessment, whichever is the greater;
"the Relevant Company" Octel Corp. or any other company whose shares are as
a result of a Reconstruction or Take Over, Scheme
Shares;
"Relevant Event" in relation to any Scheme Shares, an event which
gives rise to a charge to income tax under Schedule
E pursuant to the provisions of the Act;
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"Rules" the Rules of the Scheme and "Rule" shall be
construed accordingly;
"Scheme" Octel Profit Sharing Share Scheme in its present
form, or as from time to time altered in
accordance with the Rules;
"Scheme Shares" Shares held by the Trustee upon the terms of this
Scheme on behalf of the Participants;
"Share" a share in Octel Corp. satisfying paragraphs 10,
11, 12 and 14 of Schedule 9 to the Act;
"Trustee" the Trustee referred to in the Deed, or such other
person or persons who is or are the trustee or
trustees from time to time of the Scheme;
"Year of Assessment" a year beginning on any 6 April and ending on the
following 5 April.
References to any statutory provision are to that provision as amended or
re-enacted from time to time and, unless the context otherwise requires, words
in the singular include the plural (and vice versa) and words importing the
masculine shall include the feminine (and vice versa).
2. INVITATIONS TO PARTICIPATE
2.1 Issue of Invitations
When the Directors have determined that this Scheme shall operate, the
Company shall, following the applicable Qualifying Date, issue an
invitation to each Eligible Employee inviting him to consent (if he has not
already done so) to the appropriation of Shares on the proposed
Appropriation Day (or if so provided in the Invitation, on all future
Appropriation Days until further notice) by signing and returning the
accompanying Agreement duly completed and signed by such date at least
fourteen days after the date of the Invitation as shall be specified in the
Invitation (but in any event prior to the relevant Appropriation Day).
2.2 Terms of Agreement
Save as provided in Clause 6 of the Deed, an Agreement shall bind the
relevant Eligible Employee in contract with the Company:
a to permit the Scheme Shares to be appropriated to him to remain in the
hands of the Trustee throughout the applicable Period of Retention;
and
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b not to assign, charge or otherwise dispose of his beneficial interest
in those Scheme Shares during the applicable Period of Retention; and
c if he directs the Trustee to transfer the legal title of those Scheme
Shares to him at any time before the applicable Release Date, to pay
to the Trustee before such transfer takes place a sum equal to income
tax at the basic rate on the Appropriate Percentage of the
Locked-In-Value of such Scheme Shares at the time of such direction;
and
d not prior to the relevant Release Date to direct the Trustee to
dispose of those Scheme Shares otherwise than as aforesaid or by sale
for the best consideration in money that can reasonably be obtained
therefor at the time of such sale.
2.3 Employee Electing not to Participate
Notwithstanding anything to the contrary, an Eligible Employee may by
written notice given to the Company before an Appropriation Day direct that
Shares shall not be appropriated to him on that Appropriation Day or, if
applicable, on each subsequent Appropriation Day until further notice.
3. PURCHASE OF SHARES FOR APPROPRIATION
3.1 Arrangements for Purchasing Shares
The Trustee may upon the direction of the Directors, purchase Shares from
time to time until the Dealing Day preceding the relevant Appropriation
Day. Such Shares may be purchased on The New York Stock Exchange or
privately (provided that any such private purchase made at the time when
the Shares are listed is made at a price which is equivalent to the middle
market quotation for such Shares as reported in The Wall Street Journal for
the Dealing Day preceding the day in question) and provided that an
Appropriation of Shares shall be at not less than the Initial Market Value.
3.2 When Shares may not be Purchased
The Trustee shall not purchase any Share unless it is reasonably certain at
that time that any appropriation of that Share on the relevant
Appropriation Day would not breach any relevant term of this Scheme or any
similar scheme established by the Company or any of its Subsidiaries.
4. SUBSCRIPTION OF SHARES FOR APPROPRIATION
4.1 Arrangements for Subscription for New Shares
The Trustee, at the direction of the Directors, may at any time within the
period of 30 days prior to the Dealing Day immediately preceding the
relevant Appropriation Day, subscribe for Shares for appropriation under
this Scheme on that Appropriation Day, and the price per Share at which the
Trustee subscribes for Shares under this Scheme shall be the greater of:-
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a the nominal value of a Share on the date of subscription; and
b the market value of a Share which:
i so long as the Shares are listed on the New York Stock Exchange,
shall be the middle market quotation of a Share as derived from
the New York Stock Exchange (as derived from the Wall Street
Journal) on the day immediately preceding the Dealing Day before
the date of subscription; or
ii so long as the Shares are not listed on the New York Stock
Exchange shall be their value determined in accordance with
Section 272 of the Taxation of Chargeable Gains Act 1992 and as
agreed in advance with the Shares Valuation Division of the
Inland Revenue for the purposes of the Scheme.
4.2 Timing of Contributions to Trustees
Contributions to be made by the Company and each Participating Company to
the Trustee to support any purchase for or subscription of Shares to be
made by the Trustee for appropriation on any Appropriation Day shall be
paid not later than the Dealing Day immediately prior to the relevant
Appropriation Day.
5. APPROPRIATION OF SHARES
5.1 Number of Appropriations
Not more than two appropriations of Shares shall be made under the Scheme
in each Year of Assessment out of profits of the Participating Companies.
5.2 Method of Appropriation
Shares shall be appropriated amongst Eligible Employees on an Appropriation
Day in accordance with such one or more of the following methods as the
Directors shall determine:-
a Eligible Employees shall receive Shares having an Initial Market Value
equal to such percentage of their Qualifying Remuneration as the
Directors shall determine; or
b Eligible Employees shall receive a number of Shares per year of
Continuous Employment with one or more Participating Companies and/or
Subsidiaries; or
c Eligible Employees shall receive a fixed number of Shares or a number
of Shares with a Market Value equal to a fixed sum; or
d such other formula to be determined by the Directors and contained in
a supplementary Trust Deed to be executed by the Trustees and the
Company, and approved by the Inland Revenue.
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For the avoidance of doubt, the methods mentioned in this Rule may be added
but not multiplied.
5.3 Proportionate allocation of Shares which do not rank pari passu
Where the Trustee on an Appropriation Day appropriates Shares a proportion
of which rank for any dividend or other rights by reference to a record
date preceding the relevant Appropriation Day and a proportion of which do
not, then the Shares to be appropriated to each Eligible Employee shall as
far as practicable be in the same proportions thereto.
5.4 Limitation to Relevant Amount
The aggregate of the Initial Market Value of all Shares which may be
appropriated to any Participant in any Year of Assessment shall not exceed
the Relevant Amount.
5.5 Evidence of share ownership
Evidence of share ownership shall be provided by the Company in respect of
Scheme Shares and shall be delivered to or to the order of the Trustee.
6. ISSUE OF SHARES
Shares to rank pari passu
All Shares issued under the Scheme shall as to voting, dividend, transfer
and other rights (including those arising on a liquidation) rank pari passu
in all respects with the Shares then in issue.
7. DISPOSALS AND PAYMENT
7.1 Prohibition on Disposal by Trustee
The Trustee shall not dispose of any Scheme Shares which have been
appropriated to a Participant (whether to the Participant concerned or
otherwise) except in accordance with Clause 5 of the Deed.
7.2 Accounting for Cash Receipts
Upon receipt of a sum of money being (or being part of) the proceeds of any
disposal or Capital Receipt in respect of any Scheme Shares, the Trustee
shall (subject to compliance with the provisions of the Act) account to the
Participant for any balance remaining in their hands and relating to such
Scheme Shares, provided that any sum of less than (pound)1 distributable to
a particular Participant may be retained by the Trustee.
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7.3 Accounting by Participating Company
Any Participating Company to which the Trustee pays any part of any such
sum as is referred to in Rule 7.2 shall (subject to compliance with the
Act) forthwith account to the Participant for the balance remaining in its
hands.
8. TRANSFER OF LEGAL TITLE
8.1 Transfer free of Income Tax
Forthwith upon the earlier of:
a the Release Date of any Scheme Shares; and
b any time at which by reason of the provisions of the Act any such
Scheme Shares shall cease to give rise upon their disposal to a charge
to income tax on the relevant Participant,
the Trustee shall transfer the applicable Scheme Shares to the Participant
concerned.
8.2 Transfer after Period of Retention
At any time after the end of the applicable Period of Retention, a
Participant may, by notice in writing require the Trustee to transfer the
relevant Scheme Shares into his name.
9. STAMP DUTY
Any stamp duty, stamp duty reserve tax or other expenses involved in any
transfer of Shares by the Trustee shall be payable:-
a in the case of a transfer into the name of the Participant concerned,
by the Trustee (and reimbursed by the Company); and
b in any other case, by the Participant concerned or the purchaser from
the Participant concerned.
10. DISPUTES
The decision of the Directors in any dispute or question affecting any
Eligible Employee or Participant under this Scheme shall be final and
conclusive.
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11. RIGHTS ON TERMINATION OF EMPLOYMENT
In no circumstances shall any person who has ceased to be an employee of
any Participating Company by reason of dismissal or otherwise howsoever or
who is under notice of termination of his employment be entitled to claim
as against such Participating Company or the Trustee any compensation for
or in respect of any consequential loss he may suffer by reason of the
operation of the terms of the Scheme or of the provisions of the Act.
12. DUTY TO ACCOUNT FOR PAYE ETC
12.1 Deduction from Cash Payments
Where the Trustee receives a sum of money which constitutes (or forms part
of):
a the proceeds of a disposal of Shares falling within Clause 6 which
constitutes a Relevant Event, or
b a Capital Receipt,
then, if required by and in accordance with the provisions of paragraph 7
of Schedule 10 of the Act it shall pay to the Company or relevant
Participating Company out of that sum of money an amount equal to that on
which income tax is payable and the Company or relevant Participating
Company shall then pay over that amount to the Participant in question but
in so doing shall make a PAYE deduction, unless such Participant shall have
ceased to be employed by the Company or Participating Company or the Board
of Inland Revenue otherwise directs when the Trustee shall pay over the
amount to the Participant but in so doing shall deduct United Kingdom
income tax at the basic rate for the time being in force on an amount equal
to that on which income tax is payable.
12.2 Transfer of Shares prior to Release Date
Where the Trustee receives from a Participant who has directed it to
transfer the ownership of his Shares to him at any time before the Release
Date, the sum calculated in accordance with Rule 2.2c, that sum shall be
treated as a PAYE deduction by the Trustee.
12.3 Maintenance of records
The Trustee shall maintain such records as may be necessary to enable then
to carry out their obligations under paragraph 7 of Schedule 10 of the Act,
including records of all payments to the Company and sums deducted by the
Trustee falling within Rule 12.1 and all sums received from Participants
falling within Rule 12.2.
12.4 Information to Participants
The Trustee shall inform each Participant in writing of any facts relevant
to determining the liability (if any) of that Participant to income tax
under Schedule E by reason of an occurrence of an event under the Scheme in
relation to his Scheme Shares.
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13. ALTERATIONS
13.1 General Power to Amend Scheme
Subject to the concurrence of the Trustee in a deed supplemental hereto,
the Rules of the Scheme may be altered in accordance with the following
provisions of this Rule. Any such alterations shall be binding on all
Participating Companies.
13.2 Amendment prior to Inland Revenue approval
The Directors may, prior to the approval of the Scheme under the Act by the
Inland Revenue, alter the Rules of the Scheme as may be necessary in order
to obtain such approval.
13.3 Amendment subsequent to Inland Revenue approval
After the date on which the Scheme is approved by the Inland Revenue under
the Act, the Directors may in their discretion alter the Rules provided
that no such alteration shall be effective until approved by the Inland
Revenue.
13.4 Amendment which adversely affects Participants
No alteration which purports to enlarge the obligations or restrict the
rights of any Participant in respect of Scheme Shares already appropriated
to him shall be effective.
14. GENERAL
The Company in general meeting or the Directors may at any time resolve to
terminate this Scheme, in which event no further Scheme Shares shall be
appropriated but the provisions of this Scheme shall continue in full force and
effect in relation to Scheme Shares already appropriated
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SCHEDULE TWO: NOTICE OF APPROPRIATION
To: (Name) Date:
(Address)
From: The Trustee of Octel Profit Sharing Share Scheme
This is to certify that the Trustee has now made an appropriation to [Name of
Participant] ("the Participant") of [ ] Ordinary Shares of [$ ] each in Octel
Corp. under the Scheme, and their initial market value for income tax purposes
is set out below[based on the current share price of $ [ ] converted at an
exchange rate of $ : (pound)1]:-
Date of Initial Number of Shares Value per share Market Value
Appropriation (pound) (pound)
The Ordinary Shares are held for the Participant by the Trustee of Octel Profit
Sharing Scheme and are subject to a valid contract under paragraph 2 (2) of
Schedule 9 of the Income and Corporation Taxes Act 1988.
Yours faithfully
for Octel Profit Sharing Trust Co. Limited
Notes:
1. PAYMENTS OF DIVIDENDS
Any dividends will be paid by the BACS system directly to your nominated bank
account. It is very important therefore that you notify the Trustee immediately
if you change your bank details (see below).
2. INCOME TAX
Income tax is not payable on the value of your shares if they are held on your
behalf by the Trustee until the `Release Date' (currently three years from the
date of appropriation). The amount of any dividend received and its tax credit
should be entered on your Income Tax Return for the relevant year.
72
OCTEL PROFIT SHARING SHARE SCHEME: NOTICE OF APPROPRIATION
- --------------------------------------------------------------------------------
Write to the Trustee if:
(1) you change your name: (give your old names and new names in full and send a
copy of any documentation, e.g. marriage certificate);
(2) you change your address: (give your old and new address and state your full
names).
Address all such correspondence to the Trustee at:-
Trustee of Octel Profit Sharing Share Scheme
Octel Profit Sharing Trust Co. Limited
c/o The Associated Octel Company Ltd
PO BOX 17
Oil Sites Road
Ellesmere Port
South Wirral
L65 4 HF
ALWAYS WRITE NAMES AND ADDRESSES IN BLOCK CAPITALS
73
OCTEL PROFIT SHARING SHARE SCHEME: DEED OF ADHERENCE
- --------------------------------------------------------------------------------
SCHEDULE THREE: DEED OF ADHERENCE
THIS DEED is made the [ ] day of [ ] 1999
BETWEEN
(1) The Associated Octel Company Limited whose registered office is at Suite 2,
4th Floor, Berkeley Square House, Berkeley Square, London, W1X 6DT ("the
Company");
(2) Octel Profit Sharing Trust Co. Limited whose registered office is at Suite
2, 4th Floor, Berkeley Square House, Berkeley Square, London, W1X 6DT ("the
Trustee"); and
(3) [ ] whose registered office is at [ ] ("the New Participating
Company").
WHEREAS
(A) This Deed is supplemental to a Deed dated [ ] and made between the Company
and the Trustee (hereinafter called the "Principal Deed") whereby the
Company established Octel Profit Sharing Share Scheme (hereinafter called
"the Scheme").
(B) The New Participating Company is controlled by the Company within the
meaning of Section 840 of the Income and Corporation Taxes Act 1988.
(C) In pursuance of the power contained in Clause 4 of the Principal Deed, the
Company has agreed that subject to its entering into this Deed of
Adherence, the New Participating Company may become a Participating Company
for the purposes of the Scheme.
NOW THIS DEED WITNESSES as follows:-
1. The Company hereby agrees that the New Participating Company shall be a
Participating Company for the purposes of the Scheme.
2. The New Participating Company hereby covenants with the Company and with
the Trustee that it will observe and perform all covenants, conditions and
provisions contained in the Principal Deed and all the provisions of the
Scheme applicable to Participating Companies.
IN WITNESS whereof the parties hereto have caused this Deed to be executed the
day and year first before written
74
OCTEL PROFIT SHARING SHARE SCHEME: DEED OF ADHERENCE
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THE COMMON SEAL of
The Associated Octel Company
Limited hereto affixed in
the presence of:
Director
Secretary
THE COMMON SEAL of )
Octel Profit Sharing Trust Co. Limited )
was hereto affixed in )
the presence of: )
Authorised signatory
Authorised signatory
THE COMMON SEAL of
[ ]
was hereto affixed in
the presence of:
Director
Secretary
75
OCTEL PROFIT SHARING SHARE SCHEME:
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SCHEDULE FOUR: INVITATION LETTER
Dear [ ]
Octel Profit Sharing Share Scheme ("the Scheme")
The Directors of the Company invite you to participate in the Scheme, and I am
pleased to announce that you are eligible to have [ ] Ordinary Shares in Octel
Corp. with a value of [(pound) ] appropriated to you.
In order to participate in this appropriation you must complete the top copy of
the Contract of Participation which is enclosed and return it to [ ] not later
than [ ]. THE SECOND COPY OF THE CONTRACT OF PARTICIPATION SHOULD BE RETAINED -
PLEASE KEEP IT IN A SAFE PLACE
Yours faithfully
76
OCTEL PROFIT SHARING SHARE SCHEME:
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SCHEDULE FIVE: PARTICIPATION AGREEMENT
Octel Profit Sharing Share Scheme ("the Scheme")
To: [ ]
Section I
- ---------
I have received the invitation to participate in Octel Profit Sharing Share
Scheme dated [ ] notifying me of my entitlement to receive ordinary shares of [$
] each in Octel Corp. and I hereby instruct you that I wish to take up my full
entitlement to Shares.
You will receive your full entitlement to Shares provided you have completed
Section II below.
Section II
- ----------
You must complete this Section if you intend to take any Shares;
I wish to be appropriated Shares under the Scheme and in consideration of such
appropriation I agree with the Company as follows:-
(1) I will be bound by the Rules of the Scheme;
(2) I will permit the Shares appropriated to me under the Scheme to remain
in the hands of the Trustee of the Scheme throughout the period up to
the Release Date (as defined in the Rules of the Scheme currently
three years after the Shares are appropriated to me);
(3) I will not assign, charge or otherwise dispose of my beneficial
interest in the Shares period up to the Release Date;
(4) If I direct the Trustee of the Scheme to transfer the ownership of my
Shares to me at any time before the Release Date (as defined in the
Rules of the Scheme - currently three years after the Shares are
appropriated to me), I will pay to the Trustee of the Scheme before
the transfer takes place such sum on account of income tax as they are
required to collect under the Income and Corporation Taxes Act 1988;
(5) I will not direct the Trustee of the Scheme to dispose of my Shares in
any other way at any time after the Retention Period and before the
Release Date, except by sale for the best consideration in money that
can reasonably be obtained at the time of the sale.
77
OCTEL PROFIT SHARING SHARE SCHEME:
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(6) I will permit the Trustee to make any payments of dividends directly
to me through the Bank Automated Clearing System (BACS) and understand
that this will require details of my nominated bank account to be
disclosed to the Trustee for the purposes of making this payment to
me.
Provided that none of the obligations contained in paragraphs (2) and (3) above
shall prevent me from:-
a giving directions to the Trustee of the Scheme; or
b agreeing to sell to the Trustee of the Scheme my beneficial interest in my
Shares in accordance with the provisions of paragraph 1 of Schedule 10 of
the Income and Corporation Taxes Act 1988 (which only applies in the event
of company reconstructions, schemes of arrangement, take-overs and similar
events).
Signed ............................. Dated ..................
Signed .....................................Dated ...............
78
OCTEL PROFIT SHARING SHARE SCHEME:
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EXECUTED as a DEED by )
The Associated Octel Company Limited )
Director
Director/Secretary
EXECUTED as a DEED by )
Octel Profit Sharing Trust Co. Limited )
Director
Director/Secretary
79