-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Dnnlq3rcDsNTdfbBTaZF7HgBW9DqSmog3U7Pm1hsbyjpbf7eKBmsCOhgz4DIHHqR jvICaTzSVNUvvy+MODOlMQ== 0000932440-97-000304.txt : 19971024 0000932440-97-000304.hdr.sgml : 19971024 ACCESSION NUMBER: 0000932440-97-000304 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19971023 EFFECTIVENESS DATE: 19971023 SROS: CSE SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNION CARBIDE CORP /NEW/ CENTRAL INDEX KEY: 0000100790 STANDARD INDUSTRIAL CLASSIFICATION: INDUSTRIAL ORGANIC CHEMICALS [2860] IRS NUMBER: 131421730 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-38493 FILM NUMBER: 97699356 BUSINESS ADDRESS: STREET 1: 39 OLD RIDGEBURY RD CITY: DANBURY STATE: CT ZIP: 06817-0001 BUSINESS PHONE: 2037942000 MAIL ADDRESS: STREET 1: 39 OLD RIDGEBURY RD CITY: DANBURY STATE: CT ZIP: 06817-0001 FORMER COMPANY: FORMER CONFORMED NAME: UNION CARBIDE CORP DATE OF NAME CHANGE: 19890806 FORMER COMPANY: FORMER CONFORMED NAME: UNION CARBIDE & CARBON CORP DATE OF NAME CHANGE: 19710317 S-8 1 As filed with the Securities and Exchange Commission on October 22, 1997. Registration No. 333- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Union Carbide Corporation ------------------------------------------------ (Exact name of registrant as specified in its charter) New York 13-1421730 - --------------------------------------- --------------------------------- (State or other jurisdiction of (IRS Employer Identification No.) incorporation or organization) 39 Old Ridgebury Road, Danbury, CT 06817-0001 ------------------------------------------------ (Address of principal executive offices) 1997 Union Carbide Long-Term Incentive Plan ------------------------------------------------ (Full title of the plan) Joseph E. Geoghan, Esq. Vice President, General Counsel and Secretary Union Carbide Corporation 39 Old Ridgebury Road, Danbury, CT 06817-0001 ------------------------------------------------ (Name and address of agent for service) (203) 794-2000 ------------------------------------------------ (Telephone number, including area code, of agent for service) CALCULATION OF REGISTRATION FEE ================================================================================================================================ Title of securities to Amount to be Proposed maximum Proposed maximum Amount of be registered registered offering price per share(1) aggregate offering price(1) registration fee - -------------------------------------------------------------------------------------------------------------------------------- Common Stock, 6,000,000 shares $47.156 $282,936,000 $85,739.00 $1.00 par value ================================================================================================================================
(1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) and (h) under the Securities Act of 1933, as amended, on the basis of the average of the high and low prices reported in the consolidated reporting system on October 15, 1997. PART I INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS The document(s) containing the information specified by Part I of this Form S-8 Registration Statement (the "Registration Statement") will be sent or given to participants in the 1997 Union Carbide Long-Term Incentive Plan (the "Plan") of Union Carbide Corporation, a New York corporation (the "Company"), as specified in Rule 428(b)(1) promulgated by the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Securities Act"). Such document(s) are not being filed with the Commission but constitute (along with the documents incorporated by reference into the Registration Statement pursuant to Item 3 of Part II hereof), a prospectus that meets the requirements of Section 10(a) of the Securities Act. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE. The following documents have been filed by the Company with the Commission and are hereby incorporated by reference in this Registration Statement: (a) The Company's Annual Report on Form 10-K for the year ended December 31, 1996, which includes a description of the Company's Common Stock. (b) The description of the Company's Common Stock, which is set forth in the Restated Certificate of Incorporation of the Registrant, as amended and which is also incorporated by reference in Exhibit 3.1 to the Annual Report of the Registrant on Form 10-K for the year ended December 31, 1994. (c) All documents subsequently filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such documents. ITEM 4. DESCRIPTION OF SECURITIES. Not applicable. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. None. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Sections 721 through 726 of the New York Business Corporation Law provide for indemnification of directors and officers. If a director or officer is successful on the merits or otherwise in a legal proceeding, he must be indemnified to the extent he was successful. Further, indemnification is permitted in both third-party and derivative suits if he acted in good faith and for a purpose he reasonably believed was in the best interest of the Company, and if, in the case of a criminal proceeding, he had no reasonable cause to believe his conduct was unlawful. Indemnification under this provision applies to judgments, fines, amounts paid in settlement and reasonable expenses, in the case of third party actions, and amounts paid in settlement and reasonable expenses, in the case of derivative actions. In a derivative action, II-1 however, a director or officer may not be indemnified for amounts paid to settle such a suit or for any claim, issue or matter as to which such person shall have been adjudged liable to the Company absent a court determination that the person is fairly and reasonably entitled to indemnity. Notwithstanding the failure of the Company to provide indemnification and despite any contrary resolution of the board or shareholders, indemnification shall be awarded by the proper court pursuant to Section 724 of the New York Business Corporation Law. Under New York law, expenses may be advanced upon receipt of an undertaking by or on behalf of the director or officer to repay the amounts in the event the recipient is ultimately found not to be entitled to indemnification. The advance is conditioned only upon receipt of the undertaking and not upon a finding that the officer or director has met the applicable indemnity standards. Article V of the Company's By-Laws requires it to indemnify each of its past, present and future directors, officers and employees to the fullest extent permitted by law for any and all costs and expenses resulting from or relating to any suit or claim arising out of service to the Company or to other organizations at the Company's request. The Company has entered into indemnity agreements with each of its directors and officers which require the Company, among other things, to indemnify each director or officer for all costs and expenses of suits and claims (to the fullest extent permitted by law), and to advance to each director or officer the costs and expenses of defending any suit or claim if such director or officer undertakes to pay back such advances to the extent required by law. These provisions do not apply to any suit or claim voluntarily commenced by the director or officer against the Company, unless the institution of such proceeding was approved by a majority of the Board of Directors or the director or officer is successful on the merits in such proceeding. Section 402 of the New York Business Corporation Law permits the Company to include in its certificate of incorporation provisions eliminating the personal liability of directors to the Company or its shareholders for any breach of duty in such capacity unless a judgment or final adjudication adverse to the director that his acts or omissions were in bad faith or involved intentional misconduct or a knowing violation of law or that he personally gained a financial profit or other advantage to which he was not legally entitled or his acts violated Section 719 of the New York Business Corporation Law. The certificate of incorporation of the Company contains a provision eliminating the personal liability of its directors to the Company and its shareholders except to the extent such liability may not be eliminated by law. The Company carries directors' and officers' insurance which covers its directors and officers against certain liabilities they may incur when acting in their capacity as directors or officers of the Company. II-2 ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. Not Applicable. ITEM 8. EXHIBITS. EXHIBIT NUMBER DESCRIPTION 4.1 1997 Union Carbide Long-Term Incentive Plan 4.2 Restated Certificate of Incorporation of the Registrant, as amended (incorporated by reference to Exhibit 3.1 to the Annual Report of the Registrant on Form 10-K for the year ended December 31, 1994) 5 Opinion of Kelley Drye & Warren LLP, Counsel to Company, as to the legality of the shares being registered under this Registration Statement. 23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors 23.2 Consent of Kelley Drye & Warren LLP (included in opinion filed as Exhibit 5) 24 Powers of Attorney of Directors and Certain Officers of the Company (included on the signature pages hereof) II-3 ITEM 9. UNDERTAKINGS. THE UNDERSIGNED COMPANY HEREBY UNDERTAKES: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) to include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided however that subparagraphs (i) and (ii) do not apply if the information required to be included in a post-effective amendment by those subparagraphs is contained in periodic reports filed by the Company pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 ("1934 Act") that are incorporated by reference in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for the purposes of determining any liability under the Securities Act, each filing of the Company's annual report pursuant to Section 13(a) or 15(d) of the 1934 Act (and where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the 1934 Act), that it is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (5) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions described in Item 6 of this Registration Statement, or otherwise, the Company has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in the opinion of its counsel the matter has been settled by controlling II-4 precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-5 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Company certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Danbury, State of Connecticut on this 24th day of September, 1997. UNION CARBIDE CORPORATION By:JOHN K. WULFF --------------------------------------- John K. Wulff Vice President, Chief Financial Officer and Controller (Principal Financial and Accounting Officer) POWER OF ATTORNEY We, the undersigned officers and directors of Union Carbide Corporation, hereby severally constitute and appoint William M. Joyce and John K. Wulff, and each of them singly, our true and lawful attorney, with full power to them, to sign for us in our names in the capacities indicated below, this registration statement and any and all post-effective amendments to this Registration Statement, and generally to do all things in our name and on our behalf in such capacities to enable Union Carbide Corporation to comply with the provisions of the Securities Act of 1933, as amended, and all requirements of the Securities and Exchange Commission, hereby ratifying and confirming our signatures as they may be signed by our said attorneys, or any of them, to said Registration Statement and any and all amendments thereto. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates stated. SIGNATURE TITLE DATE Chairman of the Board WILLIAM H. JOYCE President, Chief Executive September 24, 1997 - ---------------------- Officer and Director William H. Joyce (Principal Executive Officer) II-6 Vice-President, Chief Financial JOHN K. WULFF Officer and Controller September 24, 1997 - ---------------------- (Principal Financial and John K. Wulff Accounting Officer) JOHN J. CREEDON Director September 24, 1997 - ---------------------- John J. Creedon C. FRED FETTEROLF Director September 24, 1997 - ---------------------- C. Fred Fetterolf JOSEPH E. GEOGHAN Director September 24, 1997 - ---------------------- Joseph E. Geoghan THOMAS P. GERRITY Director September 24, 1997 - ---------------------- Thomas P. Gerrity - ---------------------- Director September 24, 1997 Rainer E. Gut II-7 VERNON E. JORDAN, JR. Director September 24, 1997 - ---------------------- Vernon E. Jordan, Jr. - ---------------------- Director September 24, 1997 Robert D. Kennedy RONALD L. KUEHN, JR. Director September 24, 1997 - ---------------------- Ronald L. Kuehn, Jr. ROZANNE L. RIDGWAY Director September 24, 1997 - ---------------------- Rozanne L. Ridgway JAMES M. RINGLER Director September 24, 1997 - ---------------------- James M. Ringler WILLIAM S. SNEATH Director September 24, 1997 - ---------------------- William S. Sneath II-8 EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION 4.1 1997 Union Carbide Long-Term Incentive Plan 4.2 Restated Certificate of Incorporation of the Registrant, as amended (incorporated by reference to Exhibit 3.1 to the Annual Report of the Registrant on Form 10-K for the year ended December 31, 1994). 5 Opinion of Kelley Drye & Warren LLP, Counsel to Company, as to the legality of the shares being registered under this Registration Statement 23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors 23.2 Consent of Kelley Drye & Warren LLP (included in opinion filed as Exhibit 5) 24 Powers of Attorney of Directors and Certain Officers of the Company (included on the signature pages hereof) II-9 EX-4 2 EXHIBIT 4.1 WORKING COPY AS OF 5/12/97 (Restated through First Amendment) 1997 UNION CARBIDE LONG-TERM INCENTIVE PLAN TABLE OF CONTENTS PAGE Section 1: Purpose........................................................-1- Section 2: Definitions....................................................-1- Section 3: Participation..................................................-4- Section 4: Administration.................................................-4- Section 5: Awards.........................................................-5- Section 6: Stock Options..................................................-7- Section 7: Exercise Payments.............................................-11- Section 8: Grants of Stock...............................................-12- Section 9: Performance Awards............................................-13- Section 10: General Provisions............................................-14- Section 11: Amendment, Suspension, or Termination.........................-15- Section 12: Effective Date and Duration of the Plan.......................-15- 1997 UNION CARBIDE LONG-TERM INCENTIVE PLAN SECTION 1: PURPOSE. The purpose of the 1997 Union Carbide Long-Term Incentive Plan (hereinafter referred to as the "Plan") is to (a) advance the interests of Union Carbide Corporation (the "Corporation") and its stockholders by providing incentives and rewards to those employees who are in a position to contribute to the long-term growth and profitability of the Corporation; (b) assist the Corporation and its subsidiaries and affiliates in attracting, retaining, and motivating highly qualified employees for the successful conduct of their business; and (c) make the Corporation's compensation program competitive with those of other major employers. SECTION 2: DEFINITIONS. 2.1: A "Change in Control of the Corporation" shall be deemed to occur if any of the following circumstances shall occur: (i) any "person" or "group" within the meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 ("Act") becomes the "beneficial owner" as defined in Rule 13d-3 under the Act of more than 20% of the then outstanding voting securities of the Corporation; (ii) any "person" or "group" within the meaning of Sections 13(d) and 14(d)(2) of the Act acquires by proxy or otherwise the right to vote for the election of directors, for any merger or consolidation of the Corporation or for any other matter or question with respect to more than 20% of the then outstanding voting securities of the Corporation; (iii) during any period of twenty-four consecutive months, Present Directors and/or New Directors cease for any reason to constitute a majority of the Board. For these purposes, "Present Directors" shall mean individuals who at the beginning of such consecutive twenty-four month period were members of the Board and "New Directors" shall mean any director whose election by the Board 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 were Present Directors or New Directors; (iv) the stockholders of the Corporation approve a plan of complete liquidation or dissolution of the Corporation; or (v) there shall be consummated: (x) a reorganization, merger or consolidation of all or substantially all of the assets of the Corporation (a "Business Combination"), unless, following such Business Combination, (a) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the outstanding Common Stock of the Corporation and outstanding voting securities of the Corporation immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Corporation or all or substantially all of the Corporation's assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination of the outstanding Common Stock of the Corporation and outstanding voting securities of the Corporation, as the case may be, (b) no Person (excluding any corporation resulting from such Business Combination or any employee benefit plan (or related trust) of the Corporation or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 20% or more of, respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (c) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or (y) any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Corporation, provided, that the divestiture of less than substantially all of the assets of the Corporation in one transaction or a series of related transactions, whether effected by sale, lease, exchange, spin-off, sale of the stock or merger of a subsidiary or otherwise, shall not constitute a Change in Control. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur pursuant to Subparagraphs (i) and (ii) above, solely because twenty percent (20%) or more of the combined voting power of the Corporation's then outstanding securities is acquired by one or more employee benefit plans maintained by the Corporation. -2- 2.2: "Code" means the Internal Revenue Code of 1986, as now or hereafter amended. 2.3: "Employee" means all employees of the Corporation or of a subsidiary or affiliate of the Corporation participating in the Plan, including officers of the Corporation, as well as officers of the Corporation who are also directors of the Corporation. However, an individual who is a member of the Committee shall not be an "employee" for purposes of this Plan. 2.4: "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 2.5: "Exercise Payment" is a payment upon the exercise of a stock option of an amount determined by the Committee in its discretion, which amount shall not be greater than 60% of the excess of the Market Price over the option price of the stock acquired upon the exercise of the option. 2.6: "Incentive Stock Option" means any stock option granted pursuant to this Plan which is designated as such by the Committee and which complies with Section 422 of the Code. 2.7: "Market Price" is the mean of the high and low prices of the common stock of the Corporation as reported in the New York Stock Exchange-Composite Transactions on the date the option is exercised (or on the next preceding day such stock was traded on a stock exchange included in the New York Stock Exchange-Composite Transactions if it was not traded on any such exchange on the date the option is exercised). 2.8: "Non-Qualified Stock Option" means any stock option granted pursuant to this Plan which is not an Incentive Stock Option. -3- 2.9: "Retirement" shall mean retirement from employment by the Corporation or a subsidiary or affiliate with the right to receive immediately a non-actuarially reduced pension under the Corporation's Retirement Program. 2.10: "Restricted Stock" means stock of the Corporation subject to restrictions on the transfer of such stock, conditions of forfeitability of such stock, or any other limitations or restrictions as determined by the Committee. SECTION 3: PARTICIPATION. The Participants in the Plan ("Participants") shall be those Employees serving in a managerial, administrative, or professional position who are selected to participate in the Plan by the Committee of the Board of Directors of the Corporation named to administer the Plan pursuant to Section 4. SECTION 4: ADMINISTRATION. The Plan shall be administered and interpreted by a Committee of three or more members of the Board of Directors (hereinafter referred to as the "Committee") appointed by the Board. The Committee shall consist of "nonemployee directors" within the meaning of Rule 16b-3 under the Exchange Act. All decisions and acts of the Committee shall be final and binding upon all Participants. The Committee shall: (i) determine the number and types of awards to be made under the Plan; (ii) select the awards to be made to Participants; (iii) set the option price, the number of options to be awarded, and the number of shares to be awarded out of the total number of shares available for award; (iv) delegate to the Chief Executive Officer of the Corporation the right to allocate awards among Employees who are not executive officers or directors of the Corporation within the meaning of the Exchange Act, such delegation to be subject to such terms and conditions as the Committee in its discretion shall determine; (v) establish administrative -4- regulations to further the purpose of the Plan; and (vi) take any other action desirable or necessary to interpret, construe or implement properly the provisions of the Plan. SECTION 5: AWARDS. Awards under this Plan may be in any of the following forms (or a combination thereof): (i) stock option awards; (ii) exercise payment rights; (iii) grants of stock or Restricted Stock; or (iv) performance awards. Except as otherwise defined herein, "stock" shall mean the common stock, $1.00 par value, of the Corporation. All awards shall be made pursuant to award agreements between the Participant and the Corporation. The agreements shall be in such form as the Committee approves from time to time. a. MAXIMUM AMOUNT AVAILABLE. The total number of shares of stock (including Restricted Stock, if any) optioned or granted under this Plan during the term of the Plan shall not exceed 2,000,000 shares; provided, however, that if, during the term of the Plan, the Corporation (i) reacquires shares of stock (including, but not limited to, repurchases of shares on the open market or in private transactions), (ii) withholds shares in connection with the exercise of an option pursuant to Section 6.4 of this Plan, or (iii) withholds shares as a result of the exercise of an option pursuant to Section 6.7 of this Plan, or a similar provision under another incentive or stock option plan of the Corporation, to meet any applicable federal, state or local withholding tax requirements arising as a result of the exercise of an option, then additional shares of stock may be optioned or granted under this Plan equal to the number of shares so reacquired or withheld, except that no more than 4,000,000 additional shares (for a total of 6,000,000 shares under the Plan) shall be authorized for options or grants under this provision. No Participant may be granted, in the aggregate, awards which would result in the Participant receiving more than 15% of the maximum number of shares available for award under the Plan. Solely for the purpose of -5- computing the total number of shares of stock optioned or granted under this Plan, there shall not be counted any shares which have been forfeited and any shares covered by an option which, prior to such computation, has terminated in accordance with its terms or has been canceled by the Participant or the Corporation. b. ADJUSTMENT IN THE EVENT OF RECAPITALIZATION, ETC. In the event of any change in the outstanding shares of the Corporation by reason of any stock split, stock dividend, recapitalization, merger, consolidation, combination or exchange of shares or other similar corporate change or in the event of any special distribution to the stockholders, the Committee shall make such equitable adjustments in the number of shares and prices per share applicable to options then outstanding and in the number of shares which are available thereafter for Stock Option Awards (as defined in Section 6.1) or other awards, both under the Plan as a whole and with respect to individuals, as the Committee determines are necessary and appropriate. Any such adjustment shall be conclusive and binding for all purposes of the Plan. SECTION 6: STOCK OPTIONS. 6.1: The Corporation may award options to purchase common stock or Restricted Stock of the Corporation (hereinafter referred to as "Stock Option Awards") to such Participants as the Committee, or the Chief Executive Officer of the Corporation, if the Committee in its discretion delegates the right to allocate awards pursuant to Section 4, authorizes and under such terms as the Committee establishes. The Committee shall determine with respect to each Stock Option Award and designate in the grant whether a Participant is to receive an Incentive Stock Option or a Non-Qualified Stock Option. -6- 6.2: The option price of each share of stock subject to a Stock Option Award shall be specified in the grant, but in no event shall the exercise price be less than the closing price of the common stock of the Corporation on the date the award is authorized as reported in the New York Stock Exchange-Composite Transactions. If the Participant to whom an Incentive Stock Option is granted owns, at the time of the grant, more than ten percent (10%) of the combined voting power of the Participant's employer or a parent or subsidiary of the employer, the option price of each share of stock subject to such grant shall be not less than one hundred ten percent (110%) of the closing price described in the preceding sentence. 6.3: (a) Except as set forth in subsection (b) below, a stock option by its terms shall not be transferable by the Participant other than by will or the laws of descent and distribution, and, during the Participant's lifetime, will be exercisable only by the Participant. A stock option by its terms also shall be of no more than 10 years' duration, except that an Incentive Stock Option granted to a Participant who, at the time of the grant, owns stock representing more than ten percent (10%) of the combined voting power of the Participant's employer or a parent or subsidiary of the employer shall be by its terms be of no more than five (5) years' duration. A stock option by its terms shall be exercisable only after the earliest of: (i) such period of time as the Committee shall determine and specify in the grant, but in no event less than one year following the date of grant of such award; (ii) the Participant's death; or (iii) a Change in Control of the Corporation. (b) Notwithstanding the provisions of subsection (a), the terms of a Non- Qualified Stock Option may permit the Participant to transfer the Stock Option to (i) his or her spouse, children or grandchildren (referred to herein as the Participant's "Family -7- Members"), (ii) a trust or trusts for the exclusive benefit of such Family Members, or (iii) a partnership in which such Family Members are the only partners. Any transfer pursuant to this subsection (b) shall be subject to the following: (A) there may be no consideration for any such transfer; (B) the stock option agreement pursuant to which such Stock Options are granted must be approved by the Committee, and must expressly provide for transferability in a manner consistent with this subsection (b); and (C) subsequent transfers of transferred Stock Options shall be prohibited except those in accordance with subsection (a) of this Section 6.3. Following transfer, any such Stock Options shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that for purposes of Section 6.4 hereof, the term "Participant" shall be deemed to refer to the transferee. The events of death, disability, Retirement and termination of employment in the Plan hereof shall continue to be applied with respect to the original Participant, following which the Stock Options shall be exercisable by the transferee only to the extent and for the periods specified in Sections 6.3(a) and (c) hereof. (c) An option is only exercisable by a Participant (or, if subsection (b) applies, the transferee) while the Participant is in active employment with the Corporation, or its subsidiary, except: (i) in the case of a Participant's death, Retirement or disability; (ii) during a three-year period commencing on the date of a Participant's termination of employment by the Corporation other than for cause; (iii) during a three-year period commencing on the date of termination, by the Participant or the Corporation, of employment after a Change in Control of the Corporation, unless such termination of employment is for cause; or (iv) if the Committee decides that it is in the best interest of the -8- Corporation to permit individual exceptions. An option may not be exercised pursuant to this paragraph after the expiration date of the option. 6.4: An option may be exercised with respect to part or all of the shares subject to the option by giving written notice to the Corporation of the exercise of the option. The option price for the shares for which an option is exercised shall be paid on or within ten business days after the date of exercise. The terms of the stock option may provide that the option price may be paid (i) in cash, (ii) in whole shares of common stock of the Corporation owned by the Participant prior to exercising the option, (iii) by having the Corporation withhold a number of shares from the exercise, equal in value to the option price, or (iv) in a combination of cash and delivery of shares, or cash and withholding of shares of common stock. The value of any share of common stock delivered or withheld in payment of the option price shall be its Market Price on the date the option is exercised. 6.5: The Committee may, in its discretion, grant to Participants holding stock options the right to receive, with respect to each share covered by an option, payments of amounts equal to the regular cash dividends paid to holders of the Company's common stock during the period that the option is outstanding (such payments are hereinafter referred to as "Dividend Payments"). 6.6: The aggregate fair market value of all shares of stock with respect to which Incentive Stock Options are exercisable for the first time by a Participant in any one calendar year, under this Plan or any other stock option plan maintained by the Corporation (or by any subsidiary or parent of the Corporation), shall not exceed $100,000. The fair market value of such shares of stock shall be the mean of the high and low prices of the common stock of the Corporation as reported in the New York Stock Exchange - Composite -9- Transactions on the date the related stock option is granted (or on the next preceding day such stock was traded on a stock exchange included in the New York Stock Exchange Composite Transactions if it was not traded on any such exchange on the date the related stock option is granted). 6.7: In order to enable the Corporation to meet any applicable federal, state or local withholding tax requirements arising as a result of the exercise of a stock option, a Participant shall pay the Corporation the amount of tax to be withheld or may elect to satisfy such obligation by having the Corporation withhold shares that otherwise would be delivered to the Participant pursuant to the exercise of the option for which the tax is being withheld, by delivering to the Corporation other shares of common stock of the Corporation owned by the Participant prior to exercising the option, or by making a payment to the Corporation consisting of a combination of cash and such shares of common stock. Such an election shall be subject to the following: (a) the election shall be made in such manner as may be prescribed by the Committee and the Committee shall have the right, in its discretion, to disapprove such election; and (b) the election shall be made prior to the date to be used to determine the tax to be withheld and shall be irrevocable. The value of any share of common stock to be withheld by the Corporation or delivered to the Corporation pursuant to this Section 6.7 shall be the Market Price on the date to be used to determine the amount of tax to be withheld. SECTION 7: EXERCISE PAYMENTS. 7.1: The Committee may, in its discretion, grant to Participants holding stock options the right to receive Exercise Payments relating to such number of shares covered by the Participant's stock options as the Committee determines in its discretion. Exercise -10- Payments shall be reduced by the total amount which may have been received as Dividend Payments pursuant to Section 6.5 with respect to the stock option that is being exercised. 7.2: At the discretion of the Committee, the Exercise Payment may be made in cash, common stock, Restricted Stock, or a combination thereof. Exercise Payments shall be paid within 20 business days following the exercise of a related stock option; provided, however, that payment may be deferred by the Committee, in its discretion, to such date and under such terms and conditions as the Committee may determine. 7.3: Exercise Payments shall be paid only upon the exercise of related stock options which are exercised by the Participant while an active Employee; provided, however, that in the case of a Participant's death, Exercise Payments will be paid if the related stock options are exercised within nine months after death, but before the expiration of the stock option's term. In the case of a Participant's Retirement, any Exercise Payments awarded to the Participant will be paid if the stock options are exercised within the later of (i) three months after Retirement or (ii) three months after such options became exercisable, but before the expiration of the term of the stock option. SECTION 8: GRANTS OF STOCK. 8:1.The Committee may grant, either alone or in addition to other awards granted under the Plan, shares of stock or Restricted Stock to such Participants as the Committee, or the Chief Executive Officer of the Corporation, if the Committee in its discretion delegates the right to allocate awards pursuant to Section 4, authorizes and under such terms as the Committee establishes. The Committee, in its discretion, may also make a cash payment to a Participant granted shares of stock or Restricted Stock under the Plan to allow such Participant to satisfy tax obligations arising out of receipt of the stock or -11- Restricted Stock. Alternatively, the terms of the stock or Restricted Stock grant may allow for the Participant to satisfy tax withholding obligations by delivering whole shares of common stock of the Corporation to the Corporation; the value of any shares of common stock delivered in payment of tax withholding obligations shall be its Market Price on the date to be used to determine the amount of tax to be paid. 8:2. Notwithstanding any provision in this Plan to the contrary, no more than 20% of the maximum number of shares of stock available for award under this Plan shall be granted to Participants as Restricted Stock. 8:3. A grant of Restricted Stock pursuant to this Section 8 shall be subject to a minimum vesting period of at least three (3) years, or such longer period as the Committee may, in its sole discretion, determine; provided, however, that the Committee may grant up to three hundred thousand (300,000) shares of Restricted Stock with a vesting period of less than three (3) years. In the event that a Participant terminates employment with the Corporation prior to the date that the Restricted Stock satisfies a vesting period, such Restricted Stock shall be forfeited except (i) in the case of the Participant's death, disability or Retirement, (ii) in the case of a Participant's termination of employment by the Corporation other than for cause, (iii) in the case of a Change in Control of the Corporation, or (iv) if the Committee determines it is in the best interests of the Corporation to permit individual exceptions. -12- SECTION 9: PERFORMANCE AWARDS. 9.1: The Committee may grant, either alone or in addition to other awards granted under the Plan, awards of stock and other awards that are valued in whole or in part by reference to, or are otherwise based on, the market value of the common stock, Restricted Stock or other securities of the Corporation ("Performance Awards") to such Participants as the Committee, or the Chief Executive Officer of the Corporation, if the Committee in its discretion delegates the right to allocate awards pursuant to Section 4, authorizes and under such terms as the Committee establishes. Performance Awards may be paid in common stock, Restricted Stock or other securities of the Company, cash or any other form of property as the Committee shall determine. Performance Awards shall entitle the Participant to receive an award if the measures of performance established by the Committee are met. The measures of performance shall be established by the Committee in its absolute discretion. 9.2: The Committee shall determine the times at which Performance Awards are to be made and all conditions of such awards. 9.3: The Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber shares received pursuant to this Section 9 prior to the date on which any applicable restriction or performance period established by the Committee lapses. SECTION 10: GENERAL PROVISIONS. 10.1: Subject to the provisions of Section 6.3(b), if applicable, any assignment or transfer of any awards without the written consent of the Corporation shall be null and void. -13- 10.2: Nothing contained herein shall require the Corporation to segregate any monies from its general funds, or to create any trusts, or to make any special deposits for any immediate or deferred amounts payable to any Participant for any year. 10.3: Participation in this Plan shall not affect the Corporation's right to discharge a Participant. 10.4: Restricted Stock may not be sold or transferred by the Participant until any restrictions that have been established by the Committee have lapsed. 10.5: The Participant shall have, with respect to Restricted Stock, all of the rights of a stockholder of the Corporation, including the right to vote the shares and the right to receive any dividends, unless the Committee shall otherwise determine. 10.6: Upon a Participant's termination of employment during the period any restrictions are in effect, all Restricted Stock shall be forfeited without compensation to the Participant unless the Committee decides that it is in the best interest of the Corporation to permit individual exceptions. SECTION 11: AMENDMENT, SUSPENSION, OR TERMINATION. 11.1: The Board of Directors may suspend, terminate, or amend the Plan, including but not limited to such amendments as may be necessary or desirable resulting from changes in the federal income tax laws and other applicable laws, but may not, without approval by the holders of a majority of all outstanding shares entitled to vote on the subject at a meeting of stockholders of the Corporation, increase the total number of shares of stock that may be optioned or granted under this Plan. 11.2: It is intended that grants and awards made under this Plan comply with the requirements of Rule 16b-3 under the Exchange Act. Should the requirements of Rule -14- 16b-3 change, the Board of Directors may amend this Plan or grants hereunder, as necessary, to comply with the requirements of that rule or its successor provision or provisions. SECTION 12: EFFECTIVE DATE AND DURATION OF THE PLAN. This Plan shall be effective following approval by the stockholders of the Corporation. No award shall be granted under this Plan subsequent to the annual meeting of shareholders of the Corporation in 2002. -15- EX-5 3 EXHIBIT 5 October 21, 1997 Board of Directors Union Carbide Corporation 39 Old Ridgebury Road Danbury, CT 06817-0001 Re: Registration Statement on Form S-8 for 1997 Union Carbide Long-Term Incentive Plan ---------------------------------- Dear Sirs: We are acting as counsel to Union Carbide Corporation, a New York corporation ("Corporation"), in connection with the preparation and filing of a Registration Statement on Form S-8 (the "Registration Statement") under the Securities Act of 1933, as amended, ("Act") with the Securities and Exchange Commission ("Commission") relating to the registration of 6,000,000 shares of common stock, $1.00 par value per share (the "Common Stock"), of the Corporation offered for sale pursuant to the 1997 Union Carbide Long-Term Incentive Plan (the "Plan"). In connection with the opinion, we have examined and are familiar with originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records, certificates of public officials and officers of the Corporation and such other instruments as we have deemed necessary or appropriate as a basis for the opinions expressed below. For purposes of this opinion we have assumed the authenticity of all documents submitted to us as originals, the conformity to originals of all documents Board of Directors Union Carbide Corporation -2- October 21, 1997 submitted to us as certified or photostatic copies, and the authenticity of the originals of all documents submitted to us as copies. We have also assumed the legal capacity of all natural persons, the genuineness of all signatures on all documents examined by us, the authority of such persons signing on behalf of the parties thereto other than the Corporation and the due authorization, execution and delivery of all documents by the parties thereto other than the Corporation. As to certain factual matters material to the opinion expressed herein, we have relied to the extent we deemed proper upon representations, warranties and statements as to matters of officers and other representatives of the Corporation. Our opinion expressed below is subject to the qualification that we express no opinion as to any law other than the laws of the State of New York and the federal laws of the United States of America. Without limiting the foregoing, we express no opinion with respect to the applicability thereto or effect of municipal laws or the rules, regulations or orders of any municipal agencies within any such state. Based upon the foregoing, we are of the opinion that: 1. The Corporation has been duly organized and is validly existing under the laws of the State of New York. 2. The Plan has been duly adopted by the Board of Directors of the Corporation and approved by the shareholders of the Corporation. 3. The shares of Common Stock of the Corporation to which the Registration Statement relates have been duly authorized and reserved for issuance pursuant to the Plan and, when issued and sold pursuant to the Plan, will be legally issued, fully paid and non-assessable. This opinion is limited to the specific issues addressed herein, and no opinion may be inferred or implied beyond that expressly stated herein. We assume no obligation to revise or supplement this opinion should the present laws of the State of New York or the federal laws of the United States of America be changed by legislative action, judicial decision or otherwise. We hereby consent to the filing of this letter as an Exhibit 5 to the Registration Statement. In giving such consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission promulgated thereunder. Board of Directors Union Carbide Corporation -3- October 21, 1997 This opinion is furnished to you in connection with the filing of the Registration Statement and is not to be used, circulated, quoted or otherwise relied upon for any other purpose. Very truly yours, KELLEY DRYE & WARREN LLP EX-23 4 EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS The Board of Directors of Union Carbide Corporation We consent to the use of our reports incorporated herein by reference. KPMG PEAT MARWICK LLP Stamford, Connecticut October 21, 1997 -----END PRIVACY-ENHANCED MESSAGE-----