EXHIBIT 10(B)
1988 STOCK OPTION PLAN
FOR KEY EMPLOYEES OF
OLIN CORPORATION AND SUBSIDIARIES
(AS AMENDED THROUGH FEBRUARY 23, 1995)
1. PURPOSE OF THE PLAN. The general purpose of the 1988 Stock Option
Plan for Key Employees of Olin Corporation and Subsidiaries (the "Plan") is to
aid in attracting, maintaining and developing a management capable of assuring
the future success of Olin Corporation ("Olin") by providing to key employees of
Olin and its subsidiaries additional incentive to enlarge their proprietary
interest in Olin, to continue and increase their efforts on Olin's behalf and to
remain in the employ of Olin or its subsidiaries.
2. SHARES SUBJECT TO THE PLAN. Options may be granted from time to time
under the Plan in respect of an aggregate of not exceeding 1,100,000 shares of
Common Stock of Olin (subject to the provisions in paragraph 15 hereof). If any
option granted under the Plan shall expire or terminate for any reason other
than its surrender pursuant to paragraph 7 (including, without limitation, by
reason of its surrender or cancellation, in whole or in part, or the
substitution therefor of a new option) without having been exercised in full,
the unpurchased shares subject thereto shall (unless the Plan shall have been
terminated) again be available for other options to be granted under the plan.
3. ADMINISTRATION OF THE PLAN. The Plan shall be administered by a
Committee on Stock Options (the "Committee") appointed by the Board of Directors
of Olin and consisting of not less than three of those members of the Board of
Directors who are not eligible to participate in the Plan or who shall have
advised the Board of Directors in writing that they irrevocably waive any rights
under the Plan.
The Committee shall have plenary authority in its discretion, but subject
to the express provisions of the Plan, to determine the purchase price of the
Common Stock covered by each option, the employees to whom, and the time or
times at which, options shall be granted and the number of shares to be covered
by each option; to interpret the Plan; to prescribe, amend and rescind rules and
regulations relating to it; to determine the terms and provisions (and
amendments thereof) of the respective option agreements (which need not be
identical), including, if the Committee shall determine that a particular option
is to conform to the requirements of any provision of the Internal Revenue Code
as amended from time to time, such terms and provisions (and amendments) as
shall be requisite in the judgment of the Committee to provide therefor or to
conform to any change in any law or regulation applicable thereto; and to make
all other determinations deemed necessary or advisable for the administration of
the Plan. The Committee's determination on the foregoing matters shall be
conclusive.
The Committee shall select one of its members as its chairman and shall
hold its meetings at such times and places as it shall deem advisable. A
majority of its members shall constitute a
quorum. All determinations of the Committee shall be made by not less than a
majority of its members. A decision or determination reduced to writing and
signed by a majority of the members shall be fully as effective as if it had
been made by a majority vote at a meeting duly called and held. The Committee
may appoint a secretary, shall keep minutes of its meetings and shall make such
rules and regulations for the conduct of its business as it shall deem
advisable. The Committee may designate the Secretary of Olin or other employees
of Olin to assist the Committee in the administration of the Plan and may grant
authority to such persons to execute option agreements or other documents on
behalf of the Committee.
4. ELIGIBILITY; FACTORS TO BE CONSIDERED IN GRANTING OPTIONS. Options
may be granted only to regular employees (including officers) of Olin and of its
present and future subsidiary corporations ("subsidiaries"). A Director of Olin
or of a subsidiary who is not also such an employee will not be eligible to
receive an option. In determining the employees to whom options shall be granted
and the number of shares to be covered by each option, the Committee may take
into account the nature of the services rendered by the respective employees,
their present and potential contributions to the success of Olin, and such other
factors as the Committee in its discretion shall deem relevant. An employee who
has been granted an option under the Plan or under any prior stock option plan
of Olin may be granted an additional option or options if the Committee shall so
determine. Nothing contained in the Plan shall be construed to limit the right
of Olin to grant or assume options otherwise than under the Plan in connection
with the acquisition by purchase, lease, merger, consolidation or otherwise of
the business and assets of any corporation, firm or association, including
options granted to employees thereof who become employees of Olin or a
subsidiary, or for other proper corporate purposes.
5. OPTION PRICES. The purchase price of the Common Stock covered by each
option shall be determined by the Committee but shall not be less than 100% of
the fair market value of the Common Stock at the time of granting the option.
Such fair market value shall be determined by the Committee and shall be taken
at no less than the mean of the high and low sales prices of the Common Stock as
reported on the consolidated transaction reporting system for New York Stock
Exchange issues on such date or, if the Common Stock was not traded on such
date, on the first preceding day on which the Common Stock was traded.
6. EXERCISE OF OPTIONS. The Committee shall have authority in its
discretion to prescribe in any option agreement that the option will be
exercisable in full at any time or from time to time during the term of the
option, or to provide for the exercise thereof in such installments at such
times during said term as the Committee may determine. An option may be
exercised, at any time or from time to time during the term of the option, as to
any or all full shares which have become purchasable under the provisions of the
option but not as to less than 25 shares at any one time. The option price
shall be paid in full in cash or its equivalent at the time the option is
exercised; provided, however, that the Committee may elect to permit such option
price to be paid in shares of Common Stock of Olin, or a combination of cash and
shares of Common Stock of Olin, the fair market value of such Common Stock to be
determined for such purpose in such manner as shall be selected by the
Committee, but not at more than the mean of the high and low sales prices of the
Common Stock as reported on the consolidated transaction reporting system for
New York Stock Exchange issues on the date on which the optionee's written
notice of
exercise is received by Olin, or if the Common Stock was not traded on such day,
on the first preceding day on which the Common Stock was traded. The term of
each option shall be not more than ten years from the date of granting thereof,
or such shorter period as is prescribed in paragraphs 11, 13 and 14 hereof.
Except as provided in said paragraphs 11, 13 and 14 hereof, no option may be
exercised at any time unless the holder thereof is then a regular employee of
Olin or one of its subsidiaries. The holder of an option shall not have any of
the rights of a stockholder with respect to the shares covered by his or her
option until such shares shall be issued to him or her upon the due exercise of
the option.
In lieu of requiring an optionee to pay in cash such federal, state or
local income taxes as may be applicable to exercise of an option ("withholding
taxes"), the Committee may elect to permit withholding taxes to be paid by the
optionee in shares of Common Stock of Olin or in a combination of cash and
shares of Common Stock of Olin, the fair market value of such Common Stock to be
determined for such purpose as provided in the next preceding paragraph with
respect to the use of Common Stock of Olin in payment of the option price.
Shares delivered in payment of an option price or for withholding taxes may
be shares withheld by Olin upon exercise of an option or shares already owned by
the optionee.
7. STOCK APPRECIATION RIGHTS. The Committee shall have authority in its
discretion to grant a stock appreciation right ("SAR") to an optionee which
shall relate to and have the same terms and conditions as a specific option
granted to the optionee under the Plan (the "related option") together with such
additional terms and conditions, if any, as the Committee in its discretion may
prescribe. An SAR may be granted at the same time as the related option is
granted or, except as otherwise provided herein, at any time thereafter prior to
the last day on which the related option may be exercised. Each SAR shall be
evidenced by written agreement in such form as the committee shall approve'. An
SAR shall entitle the optionee, upon surrender of an exercisable related option
or an exercisable portion thereof, to receive a payment, at the election of the
Committee in cash, shares of Common Stock of Olin (and such other shares as may
be deliverable as a result of an adjustment pursuant to paragraph 15
("adjustment shares")) or a combination of cash and shares of Common Stock of
olin (and adjustment shares) equivalent to the appreciated value of the shares
that the optionee would have been entitled to purchase pursuant to the related
option or portion thereof surrendered. Such appreciated value shall be the
difference between the option price of such shares (as adjusted pursuant to
paragraph 15) and the fair market value of such shares (as defined in paragraph
5) on the date on which the optionee's notice of exercise is received by Olin.
If all or a portion of such payment is made in shares of Common Stock of Olin
(or adjustment shares), the shares shall be valued for purposes of such payment
at their fair market value, as defined in paragraph 5, on the date on which the
optionee's written notice of exercise is received by Olin. No fractional shares
shall be issued as a result of exercising an SAR.
An SAR shall be exercisable only during the period when the related option
is also exercisable. In no event shall an SAR or the related option held by an
optionee who is subject to the limitations of Section 16(b) of the Securities
Exchange Act be exercisable during the first six months following its date of
grant, provided that this restriction shall not apply in the event of the
death or disability of the optionee prior to the expiration of such six-month
period. If an SAR is exercised, the related option shall cease to be exercisable
to the extent of the number of shares with respect to which the SAR was
exercised. Upon the exercise or termination of a related option, the SAR granted
with respect thereto shall terminate to the extent of the number of shares as to
which the related option was exercised or terminated.
In lieu of requiring an optionee to pay cash and receive certificates for
shares of Common Stock of Olin (and adjustment shares) upon the exercise of an
option, if the option agreement so provides, initially or by amendment, the
Committee may elect to require the optionee to surrender the option to Olin for
cancellation as to all or any portion of the number of shares covered by the
intended exercise and receive in exchange for such surrender a payment, at the
election of the Committee, in cash, in shares of Common Stock of Olin (and
adjustment shares), or a combination of cash and shares of Common Stock of Olin
(and adjustment shares) equivalent to the appreciated value of the shares
covered by the option surrendered for cancellation. Such appreciated value
shall be the difference between the option price of such shares (as adjusted
pursuant to paragraph 15) and the fair market value of such shares, as defined
in paragraph 5, on the date on which the optionee's notice of exercise is
received by Olin. If all or any part of such payment shall be in shares of
Common Stock of Olin (or adjustment shares), the shares shall be valued for
purposes of such payment at their fair market value, as defined in paragraph 5,
on the date on which the optionee's notice of exercise is received by Olin.
Upon delivery to Olin of a notice of exercise of option, the Committee may avail
itself of its right to require the optionee to surrender the option to Olin for
cancellation as to shares covered by such intended exercise. The Committee's
right of election shall expire, if not exercised, at the close of business on
the fifth business day following the delivery to Olin of such notice. Should
the Committee not exercise such right of election, the delivery of the aforesaid
notice of exercise shall constitute an exercise by the optionee of the option to
the extent therein set forth, and payment for the shares covered by such
exercise shall become due immediately.
8. CHANGE IN CONTROL. In the event of a change in Control of Olin, as
defined below, each option then outstanding shall become immediately and fully
exercisable, notwithstanding any provision therein for the exercise of such
option in installments and unless an SAR shall already have been granted with
respect to such option, the optionee shall be deemed to hold an SAR related to
such option, exercisable in accordance with and subject to all of the terms and
conditions of the first two paragraphs of paragraph 7, for the number of shares
exercisable under such option after giving effect to such acceleration. Such
SAR may, but need not be, evidenced by separate written agreement. For the
purposes of this paragraph 8, a Change in Control shall mean that any of the
following events shall have occurred:
(i) the Corporation ceases to be publicly owned with at least 1,000
stockholders;
(ii) a person, partnership, joint venture, corporation or other entity,
or two or more of any of the foregoing acting as a group (or a "person"
within the meaning of Sections 13(d)(3) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Act")), other than the Corporation,
a majority-owned subsidiary of the Corporation or an employee benefit plan
of the Corporation or such subsidiary, become(s) the "beneficial owner" (as
defined in Rule 13(d)(3) under the Act) of 20% or more of the then
outstanding voting stock of the Corporation;
(iii) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Corporation's Board of Directors
(together with any new Director whose election by the Corporation's Board
of Directors or whose nomination for election by the Corporation's
stockholders, was approved by a vote of at least two-thirds of the
Directors then still in office who either were Directors at the beginning
of such period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of the Directors
then in office; or
(iv) the Corporation's Board of Directors determines that a tender
offer for the Corporation's shares indicates a serious intention by the
offeror to acquire control of the Corporation.
9. EMPLOYEE'S AGREEMENT TO SERVE. Each employee receiving an option
shall, as one of the terms of the option agreement, agree that he or she will,
during employment, devote his or her entire time, energy and skill to the
service of Olin or a subsidiary and the promotion of its interests, subject to
vacations, sick leave and other absences in accordance with the regular policies
of, or other reasons satisfactory to, Olin and its subsidiaries. Such
employment shall (subject to the terms of any contract between Olin or any such
subsidiary and such employee) be at the pleasure of Olin or such subsidiary, and
shall be at such compensation as Olin or such subsidiary shall determine from
time to time. Upon termination of such employee's employment either (a) for
cause or (b) voluntarily on the part of the employee and without the written
consent of Olin, any option or options held by him or her under the Plan, to the
extent not theretofore exercised, shall forthwith terminate. Retirement
pursuant to any retirement plan of Olin or of a subsidiary shall be deemed to be
a termination of employment with Olin's consent.
10. NON-TRANSFERABILITY OF OPTIONS. No option granted prior to February
23, 1995, under the Plan shall be transferable otherwise than by will or the
laws of descent and distribution, and an option may be exercised, during the
lifetime of the holder thereof, only by him or her. For options granted on or
after February 23, 1995, the following sentences shall apply: No option granted
under the Plan on or after February 23, 1995 shall be transferable otherwise
than by will or the laws of descent and distribution, except an option may be
transferred by gift to any member of the optionee's immediate family or to a
trust for the benefit of the one or more of such immediate family members if
prior to its granting the Committee shall have adopted a resolution indicating
that such option is transferable. During the lifetime of an optionee, and
option shall be exercisable only by the optionee unless it has been transferred
as permitted hereby, in which case it shall be exercisable only by such
transferee. For the purpose of this Paragraph 10 on optionee's "immediate
family" shall mean the optionee's spouse, children and grandchildren.
11. TERMINATION OF EMPLOYMENT. In the event the employment of an
employee to whom an option has been granted under the Plan shall be terminated
(otherwise than by reason of death), such option may, subject to the provisions
of the next to last sentence of paragraph 9 and to the provisions of paragraph
12, be exercised (to the extent of the number of shares that the
employee was entitled to purchase under such option at the termination of
employment) at any time within three months after such termination (which three-
month period may be extended by the Committee), but in no event shall such
three-month period or any such extension permit the exercise of an option after
the expiration date of the option specified in the option agreement therefor.
Options granted under the Plan shall not be affected by any change of duties or
position so long as the optionee continues to be an employee of Olin or of a
subsidiary. Nothing in the Plan or in any option granted pursuant thereto shall
confer on any employee any right to continue in the employ of Olin or any of its
subsidiaries or affect in any way the right of Olin or any of its subsidiaries
to terminate his or her employment at any time.
12. CONDITIONS TO ENJOYMENT OF OPTIONS. The following conditions shall
apply to the grant and exercise of options:
(i) The optionee shall not render services for any organization or
engage, directly or indirectly, in any business which, in the judgment of
the Committee or, if delegated to the Chief Executive Officer, in the
judgment by such Officer, is or becomes competitive with Olin or any
subsidiary, or which is or becomes otherwise prejudicial to or in conflict
with the interests of Olin or any subsidiary. Such judgment shall be based
on the optionee's positions and responsibilities while employed by Olin or
any subsidiary, the optionee's post-employment responsibilities and
position with the other organization or business, the extent of past,
current and potential competition or conflict between Olin or a subsidiary
and the other organization or business, the effect on customers, suppliers
and competitors of the optionee's assuming the post-employment position,
the guidelines established in the then current edition of Olin's Code of
Business Conduct, and such other considerations as are deemed relevant
given the applicable facts and circumstances. The optionee shall be free,
however, to purchase as an investment or otherwise, stock or other
securities of such organization or business so long as they are listed upon
a recognized securities exchange or traded over the counter, and such
investment does not represent a substantial investment to the optionee or a
greater than 10% equity interest in the organization or business.
(ii) The optionee shall not, without prior written authorization from
Olin, disclose to anyone outside Olin, or use in other than Olin's
business, any secret or confidential information, knowledge or data,
relating to the business of Olin or a subsidiary in violation of his or her
agreement with Olin or the subsidiary.
(iii) The optionee, pursuant to his or her agreement with Olin or a
subsidiary, shall disclose promptly and assign to Olin or the subsidiary
all right, title, and interest in any invention or idea, patentable or not,
made or conceived by the optionee during employment by Olin or the
subsidiary, relating in any manner to the actual or anticipated business,
research or development work of Olin or the subsidiary and shall do
anything reasonably necessary to enable Olin or the subsidiary to secure a
patent where appropriate in the United States and in foreign countries.
Notwithstanding any other provision of the Plan, the Committee in its sole
discretion, which may be delegated to the Chief Executive Officer of Olin, may
cancel any option at any time
prior to the exercise thereof, if the employment of the optionee shall be
terminated, other than by reason of death, unless the conditions in this
paragraph 12 are met.
Failure to comply with the conditions of this paragraph 12 prior to, or
during the six months after, any exercise shall constitute a rescission of the
exercise. The difference between the fair market value (as defined in paragraph
5) on date of exercise of the shares exercised and the option price shall be
returned to Olin by the optionee, in cash, within 10 days after notice of the
rescission has been given to the optionee by Olin's Chief Executive Officer,
chief legal officer or chief personnel officer. Such notice may be given at any
time within two years of the date of exercise.
Upon exercise of an option, the optionee shall certify on a form acceptable
to the Committee that he or she is in compliance with the terms and conditions
of the Plan.
13. DEATH OF AN EMPLOYEE. If an employee to whom an option has been
granted under the Plan shall die while employed by Olin or a subsidiary or after
the termination of such employment, such option may, subject to the provisions
of the next to the last sentence of paragraph 9 and to the provisions of
paragraph 12, be exercised by the legatee or legatees of the employee under his
or her last will, or by his or her personal representatives or distributes, as
follows: if an employee dies while so employed, at any time within one year
after the employee's death (which one-year period may be extended by the
Committee), to the extent of the remaining shares covered by such option,
whether or not such shares had become purchasable by the employee at the date of
his or her death; and if an employee dies after termination of employment and
within the period an option remains exercisable, at any time within the longer
of (i) the period that he or she could have exercised the option had he or she
not died or (ii) one year after the date of death (which one-year period may be
extended by the Committee), in either case, to the extent of the number of
shares purchasable by such employee pursuant to the provisions of paragraph 11
at the date of his or her death. Notwithstanding the provisions of this
paragraph 13, no option shall be exercisable after the expiration date specified
in the option agreement therefor.
14. DISABILITY OF AN EMPLOYEE. If an employee to whom an option has been
granted under the Plan shall become totally and permanently disabled, as that
term is now defined in Section 105(d)(4) of the Internal Revenue Code, as such
Section may be amended from time to time, and the employee's employment with
Olin or a subsidiary is terminated as a result, such option may be exercised by
such employee within one year after the date of termination of employment,
provided that no option shall be exercisable after the expiration date specified
in the option agreement therefor nor for more shares than that which could have
been purchased thereunder on the date of termination of employment.
15. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. In the event of any
change in the outstanding Common Stock of Olin by reason of stockdividends,
stock splits, recapitalization, mergers, consolidations, combinations or
exchanges of shares, split-ups, split-offs, spin-offs, liquidations or other
similar changes in capitalization, or any distributions to common shareholders
other than cash dividends, the numbers, class and prices of shares covered by
outstanding options granted under the Plan and the aggregate number and class of
shares available under the
Plan, shall be appropriately adjusted by the Committee, whose determination
shall be conclusive. Without limiting the foregoing, in the event of any split-
up, split-off, spin-off or other distribution to shareholders of shares
representing a part of Olin's business, properties and assets, the Committee
may, with the consent of an optionee, modify an outstanding option or options so
that such option or options shall thereafter relate to shares of Common Stock of
Olin and shares of capital stock of the corporation owning the business,
properties and assets so split-up, split-off, spun-off or otherwise distributed
to shareholders of Olin in the same ratio in which holders of the Common Stock
of Olin became entitled to receive shares of capital stock of the corporation
owning the business, properties and assets so splitup, split-off, spun-off or
otherwise distributed.
16. EFFECTIVENESS OF THE PLAN. The Plan became effective on April 28,
1988.
17. TIME OF GRANTING OF OPTIONS. The granting of an option pursuant to
the Plan shall take place on the date established by the Committee. However, no
option may be exercised if the employee to whom the option is granted shall fail
to execute and deliver a copy of the option agreement to the Committee or Olin
within 60 days after delivery of the option agreement to such employee.
18. CONSENT OF EMPLOYEE. Every employee who accepts an option under the
Plan shall be bound by the terms and restrictions of the Plan and his or her
acceptance of an option shall constitute an agreement between him or her and
Olin and its subsidiaries and any successors in interest to any of them.
19. TERMINATION AND AMENDMENT. Unless the Plan theretofore has been
terminated as hereinafter provided, it shall terminate on, and no option shall
be granted thereunder after, April 30, 1998. The Board of Directors of Olin may
at any time prior to that date terminate the Plan, or make such modification
thereof as it shall deem advisable; provided, however, that the Board of
Directors may not, without further approval by shareholders of Olin, (a)
increase the maximum number of shares for which options may be granted under the
Plan, (b) change the manner of determining the minimum option prices, other than
to change the manner of determining the fair market value of the Common Stock as
stated in paragraph 5 above to conform to any then applicable provisions of the
Internal Revenue Code or regulations thereunder, or (c) increase the period
during which options may be granted. No termination, modification or amendment
of the Plan may, without the consent of the employee to whom any option shall
theretofore have been granted, adversely affect the rights of such employee
under such option.
20. INCENTIVE STOCK OPTION LIMITATION. The aggregate fair market value
(determined at the time an option is granted) of Common Stock of Olin with
respect to which incentive stock options (as defined in Section 422A of the
Internal Revenue Code) are exercisable for the first time by an individual
during any calendar year (under the Plan and any other stock option plan of the
individual's employer corporation and its parent and subsidiary corporations)
shall not exceed $100,000.