-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, Y7sDwkl3Dgxja/dvLMUiLdZKeSZpG096yR+XY8pBkGtp8nZr8XtEWnQiZJeHFVAV PmzqHsFttCGY+btG9ZCXbw== 0000908662-94-000008.txt : 19940613 0000908662-94-000008.hdr.sgml : 19940613 ACCESSION NUMBER: 0000908662-94-000008 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19940610 EFFECTIVENESS DATE: 19940629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WELLMAN INC CENTRAL INDEX KEY: 0000812708 STANDARD INDUSTRIAL CLASSIFICATION: 2820 IRS NUMBER: 041671740 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 033-54077 FILM NUMBER: 94533800 BUSINESS ADDRESS: STREET 1: 1040 BROAD ST STE 302 CITY: SHREWSBURY STATE: NJ ZIP: 07702 BUSINESS PHONE: 9085427300 S-8 1 ## ## ## -#- ## FORM S-8/S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Wellman, Inc. (Exact name of registrant as specified in its charter) Delaware 04-1671740 (State or other jurisdiction of I.R.S. Employer incorporation or organization) Identification No. 1040 Broad St., Suite 302, Shrewsbury, NJ 07702 (Address of Principal Executive Offices) (Zip Code) Wellman, Inc. 1985 Amended and Restated Incentive Stock Option Plan (Full title of the plan) Thomas M. Duff Wellman, Inc., 1040 Broad Street, Shrewsbury, NJ 07702 (Name and address of agent for service) (201) 542-7300 (Telephone number, including area code, of agent for service) with a copy to: Christine M. Marx, Edwards & Angell 2700 Hospital Trust Tower, Providence, RI 02903 Calculation of Registration Fee Proposed Proposed Title of maximum maximum securities offering aggregate Amount of to be Amount to be price per offering registration registered registered share* price* fee Common Stock, 1,500,000 $25.875 $38,812,500 $13,382.55 $.001 par shares value * Based on the average of the high and low prices of the Company's Common Stock reported on June 6, 1994. Pursuant to Rule 429 of the rules and regulations of the Commission under the Securities Act of 1933, as amended, the Prospectus contained herein relates also to Registration Statement Nos. 33-17196 and 33-36001. Part I, Items 1-2; Part II, Items 6. This Registration Statement relates to 1,500,000 additional shares of Wellman, Inc. (the "Company") Common Stock that may be issued pursuant to the Wellman, Inc. Amended and Restated 1985 Incentive Stock Option Plan (the "Plan") in accordance with the amendments to the Plan adopted by the Company's Board of Directors on February 24, 1994 and by the Company's stockholders on May 17, 1994. The contents of the Company's Registration Statements on Form S-8/S-3 (Registration Nos. 33-17196 and 33-36001) relating to the Plan are hereby incorporated by reference. PROSPECTUS 713,384 Shares WELLMAN, INC. Common Stock $.001 Par Value THE OFFERING This Prospectus relates to 713,384 shares of Common Stock, $.001 par value, of Wellman, Inc. (the "Company") purchased or which may be purchased by the executive officers of the Company (the "Selling Shareholders") pursuant to stock options granted pursuant to the Wellman, Inc. Amended and Restated 1985 Incentive Stock Option Plan (the "Plan"). Specific information as to the Selling Shareholders may be found on pages 3 and 4 of this Prospectus. The Company has been informed that said 713,384 shares of Common Stock may be offered from time to time publicly by the Selling Shareholders through one or more transactions on the New York Stock Exchange or through one or more brokers. The shares will be offered at prices prevailing at the time of sale. The Selling Shareholders and anyone effecting sales on behalf of the Selling Shareholders may be deemed to be "underwriters" within the meaning of the Securities Act of 1933, as amended (the "Securities Act"), and commissions or discounts given may be regarded as underwriting commissions or discounts under said Act. The Company will not receive any of the proceeds from sales by the Selling Shareholders. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this Prospectus is June 10, 1994. AVAILABLE INFORMATION The Company is subject to the information requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith, files reports and other information with the Securities and Exchange Commission (the "Commission"). Reports and other information concerning the Company can be inspected and copied at the public reference facilities maintained by the Commission at 450 5th Street, N.W., Room 1024, Washington, D.C. 20549 and at the Commission's Regional Offices in New York (Seven World Trade Center, Suite 1300, New York, New York 10048) and Chicago (500 West Madison Street, Suite 1400, Chicago, Illinois 60661), and copies of such material can be obtained from the Public Reference Section of the Commission at 450 5th Street, N.W., Washington, D.C. 20549, at prescribed rates. This Prospectus does not contain all information set forth in the Registration Statement and Exhibits thereto which the Company has filed with the Commission under the Securities Act and to which reference is hereby made. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE There are incorporated herein by reference the following documents: 1. The Company's Annual Report on Form 10-K for the year ended December 31, 1993, as filed with the Commission pursuant to the Exchange Act. 2. The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1994, as filed with the Commission pursuant to the Exchange Act. 3. The Company's Registration Statement on Form 8-A, as amended, which incorporated by reference the description of the Company's Common Stock contained in the Company's Registration Statement on Form S-1, filed with the Commission pursuant to the Securities Act. 4. All other documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold shall be deemed to be incorporated by reference into this Prospectus and such document shall be deemed to be a part hereof from the date of filing of such document. Any statement contained in this Prospectus or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Any person receiving a copy of this Prospectus may obtain, without charge, upon request, a copy of any of the documents incorporated by reference herein, except for the exhibits to such documents. Written requests should be mailed to Audrey Goodman, Wellman, Inc., 1040 Broad Street, Suite 302, Shrewsbury, New Jersey 07702. Telephone requests may be directed to Ms. Goodman at (908) 935-7312. SELLING SHAREHOLDERS Set forth below is information as to the Selling Shareholders, the number of shares of Common Stock of the Company beneficially owned, the number which may be offered as set forth on the cover of this Prospectus (assuming certain options are exercised) and the number of shares to be owned after completion of the offering assuming all shares are sold. Number of Shares of Name and Common Stock Number of Shares to be Position Beneficially Shares Which Owned After with Company Owned (1) May be Offered Offering Thomas M. Duff -0- 225,000 -0- President and Chief Executive Officer W. William Beckwith -0- 115,000 -0- Vice President Clifford J. Christensen 2,800 117,800 -0- Executive Vice President Paul D. Apostol -0- 70,000 -0- Vice President James P. Casey -0- 75,000 -0- Vice President Richard Kattar -0- 25,000 -0- Vice President Keith R. Phillips -0- 15,000 -0- Vice President, Chief Financial Office and Treasurer Mark J. Rosenblum 120 42,584 -0- Vice President - Controller Ernest Taylor -0- 28,000 -0- Vice President (1) Represents shares issued on or before the date hereof upon exercise of options issued pursuant to the Plan. The number of shares which each of the above persons, and any other persons with whom he is acting in concert for the purpose of selling the Company's shares, may sell in any three month period may not exceed 329,000 shares. LEGAL MATTERS The validity of the shares of Common Stock offered hereby has been passed upon for the Company by Edwards & Angell, Providence, Rhode Island. David K. Duffell, a partner of Edwards & Angell, is the Secretary of the Company. EXPERTS The consolidated financial statements of Wellman, Inc. at December 31, 1993 and 1992 and for each of the three years in the period ended December 31, 1993 appearing in the Company's Annual Report on Form 10-K for the year ended December 31, 1993 have been audited by Ernst & Young, independent auditors, as set forth in their report thereon appearing therein and incorporated herein by reference, which is based in part on the report of KPMG Stokes Kennedy Crowley, independent auditors. The consolidated financial statements referred to above are incorporated herein by reference in reliance upon such reports given upon the authority of such firms as experts in accounting and auditing. ## ## PART II INFORMATION NOT REQUIRED IN THE PROSPECTUS Item 3. Incorporation of Documents by Reference. There are incorporated herein by reference the following documents: 1. The Company's Annual Report on Form 10-K for the year ended December 31, 1993, as filed with the Commission pursuant to the Exchange Act. 2. The Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1994, as filed with the Commission pursuant to the Exchange Act. 3. The Company's Registration Statement on Form 8-A, as amended, which incorporated by reference the description of the Company's Common Stock contained in the Company's Registration Statement on Form S-1, filed with the Commission pursuant to the Securities Act. 4. All other documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the filing of a post-effective amendment which indicates that all securities offered hereby have been sold or which deregisters all securities then remaining unsold shall be deemed to be incorporated by reference into this Prospectus and such document shall be deemed to be a part hereof from the date of filing of such document. Any statement contained in this Prospectus or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Any person receiving a copy of this Prospectus may obtain, without charge, upon request, a copy of any of the documents incorporated by reference herein, except for the exhibits to such documents. Written requests should be mailed to Audrey Goodman, Wellman, Inc., 1040 Broad Street, Suite 302, Shrewsbury, New Jersey 07702. Telephone requests may be directed to Ms. Goodman at (908) 935-7312. Item 4. Description of Securities. Not applicable Item 5. Interests of Named Experts and Counsel. Not applicable. Item 7. Exemption of Registrant Claimed Not applicable Item 8. Exhibits. 4 - Wellman, Inc. Amended and Restated 1985 Incentive Stock Option Plan 5 - Opinion of Edwards & Angell re: legality 23(a) - Consent of Ernst & Young 23(b) - Consent of KPMG Stokes Kennedy Crowley 23(c) - Consent of Edwards & Angell (included in Exhibit 5) Item 9. Undertakings. The undersigned Registrant hereby undertakes: 1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement 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; 2) That for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to 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. The undersigned Registrant hereby further undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in the Registration Statement shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. The undersigned Registrant hereby undertakes to deliver or cause to be delivered with this prospectus, to each person to whom this prospectus is sent or given, the latest annual report to securityholders that is incorporated by reference in the prospectus and furnished pursuant to and meeting the requirements of Rule 14a-3 or Rule 14c-3 under the Exchange Act; and, where interim financial information required to be presented by Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or cause to be delivered to each person to whom the prospectus is sent or given, the latest quarterly report that is specifically incorporated by reference in the prospectus to provide such interim financial information. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. SIGNATURES AND AMENDMENTS Each person whose signature appears below hereby authorizes the President or the Vice President-Chief Financial Officer of the Registrant, or any one of them, to execute in the name of each person, and to file, an amendment or amendments to this Registration Statement, which amendment may make such other changes in this Registration Statement as said officer or officers so acting deem(s) advisable. SIGNATURES Registrant: Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing of Form S-8/S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Shrewsbury, State of New Jersey, on June 10, 1994. WELLMAN, INC. By /s/Thomas M. Duff Thomas M. Duff President Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on June 10, 1994. Signatures Title /s/ Thomas M. Duff President, Chief Executive Thomas M. Duff Officer and Director /s/ Keith R. Phillips Vice President, Chief Keith R. Phillips Financial Officer and Treasurer (Principal Financial Officer) /s/ Mark J. Rosenblum Vice President-Controller Mark J. Rosenblum (Principal Accounting Officer) Vice President and Director C. W. Beckwith /s/ Peter H. Conze Director Peter H. Conze /s/ Richard F. Heitmiller Director Richard F. Heitmiller /s/ Jonathan M. Nelson Director Jonathan M. Nelson /s/ James E. Rogers Director James E. Rogers /s/ Roger A. Vandenberg Director Roger A. Vandenberg /s/ Allan R. Dragone Director Allan R. Dragone /s/ Raymond C. Tower Director Raymond C. Tower EXHIBIT INDEX TO WELLMAN FORM S-8 Exhibit No. Exhibit Description Page 4 Wellman, Inc. Amended and Restated 1985 Incentive Stock Option Plan 5 Opinion of Edwards & Angell re: legality 23(a) Consent of Ernst & Young 23(b) Consent of KPMG Stokes Kennedy Crowley 23(c) Consent of Edwards & Angell (included in Exhibit 5) EX-4 2 Exhibit 4 WELLMAN, INC. AMENDED AND RESTATED 1985 INCENTIVE STOCK OPTION PLAN Dated as of May 17, 1994 1. Purpose: This 1985 Incentive Stock Option Plan, as amended (the "1985 Incentive Plan") is intended as an incentive and to encourage stock ownership by certain key executive and managerial employees of Wellman, Inc. (the "Company") so that they may acquire a, or increase their, proprietary interest in the success of the Company, and to encourage them to remain in the employ of the Company. The options granted before December 22, 1987 pursuant to the 1985 Incentive Plan shall be incentive stock options ("ISOs") as defined in Section 422A of the Internal Revenue Code of 1954, as from time to time amended (the "Code"). The options granted after December 21, 1987 pursuant to the 1985 Incentive Plan shall not be incentive stock options and the terms of any options issued after December 21, 1987 shall provide that it will not be treated as an incentive stock option. The 1985 Incentive Plan shall be interpreted to conform to the requirements of Section 422A with respect to options granted before December 22, 1987. Hereinafter, options granted pursuant to the 1985 Incentive Plan shall be referred to as "Options". 2. Administration: The 1985 Incentive Plan shall be administered by the members of the Compensation Committee of the Board of Directors of the Company (the "Committee"). The Committee shall from time to time at its discretion determine employees eligible for Options to be granted under the 1985 Incentive Plan, the number of shares subject to each Option, and such other matters specifically delegated to it under this 1985 Incentive Plan. In determining the grant of ISOs to eligible employees, for years prior to 1987 the aggregate market value of shares of Common Stock (the "Shares") underlying ISOs granted in any calendar year ("grant year") under the 1985 Incentive Plan and of ISOs granted in such grant year by the Company, its parent, or any subsidiary, as the terms "parent" and "subsidiary" are defined in Section 425(h) of the Code, and the predecessors of any such corporation (collectively, the "Employer Group") under any other incentive stock option plan to an individual shall not exceed $100,000 plus the amount of "unused limit carryover" to such year as determined by Section 422 A(c)(4) of the Code. The Committee shall have the final authority to interpret and construe the terms of the 1985 Incentive Plan and of any Option. No member of the Committee shall be liable for any action, interpretation or construction made in good faith with respect to the 1985 Incentive Plan or any Option. 3. Eligibility: Key executive and managerial employees (including officers, whether or not they are directors) of the Company shall be eligible to receive Options. A director of the Company who is not a full time employee of the Company shall not be eligible to receive Options. An eligible employee holding stock options and Options may receive additional Options. 4. Stock: The stock subject to Options shall be voting Shares of the Company's authorized but unissued voting Shares or the voting Shares held by the Company in its treasury. The total amount of the Shares on which Options may be granted pursuant to this 1985 Incentive Plan may equal but shall not exceed in the aggregate 3,508,000 voting Shares.* [*Originally 504,000, as adjusted for a two-for-one stock split effective June 15, 1989, and as amended on May 22, 1990 to add 1,000,000 Shares and as further amended on May 17, 1994 to add 1,500,000 Shares.] Such number of Shares shall be adjusted in accordance with the provisions of Article 5(i). In the event that an Option expires or is terminated, the Shares allocable to the unexercised portion of such Option may again be subjected to an Option. 5. Terms and Conditions of Options: Options shall be evidenced by agreements in such form as the Committee shall from time to time determine, which agreements shall comply with and be subject to the following terms and conditions: (a) Option Period: The vested and exercisable portion of the Option, as determined in accordance with Article 5(e), may be exercised for a period of 10 years from the date that the Option is granted (except that such period shall be 11 years if the Option is granted after December 21, 1987), provided, however that: (i) in the case of an Option granted to an individual who, at the time of grant, owns stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company or any parent or subsidiary corporation of the Company (a "Ten Percent Stockholder"), such period shall not exceed five years from the date of grant (except that such period shall not exceed six years from the date of grant if such date is after December 21, 1987); (ii) in the event that an optionee shall voluntarily resign, provided, with respect to Options granted on or after May 17, 1994, that such optionee does not subsequently compete with the Company, or an optionee's employment is terminated without cause, the period during which the vested and exercisable portion of the Option may be exercised shall not exceed three months after such termination (but not subsequent to the expiration of the Option); (iii) in the event that an optionee's employment is terminated by reason of death or disability (as that term is defined in Section 22(e)(3)) or upon voluntary retirement on or after 65 years of age, then the period during which the vested and exercisable portion of the Option may be exercised shall not exceed three years after such death, disability or retirement (but not subsequent to the expiration of the Option); and (iv) in the event that an optionee's employment is terminated for cause (as hereinafter defined in subparagraph (1) of this paragraph) or, with respect to Options granted on or after May 17, 1994, if the optionee shall voluntarily resign and such optionee subsequently competes with the Company then the Option shall not be exercisable at any time. (b) Number of Shares: Each Option shall state the number of Shares to which it pertains. (c) Option Price: Each Option shall state the option price, which shall be not less than 100% of the fair market value per voting Share on the date of the granting of the Option. In the case of an Option granted to a Ten Percent Stockholder, this option price shall not be less than 110% of the fair market value per voting Share on the date of the granting of the Option. The fair market value on the date of the granting of the Option shall be determined by the Committee. (d) Medium and Time of Payment: The option price shall be payable in United States dollars upon the exercise of the Option and may be paid in cash or by personal or certified check, bank draft or postal or express money order. (e) Vesting of Option: Each Option shall be vested and exercisable to the extent of 20% of the total number of Shares to which it pertains beginning one year after the date it is granted and as to an additional 20% beginning on each of the second, third, fourth and fifth anniversaries of the date it is granted, provided, however that: (i) in the event that an employee is terminated for cause (as hereinafter defined in subparagraph (1) of this paragraph) or, with respect to Options granted on or after May 17, 1994, an employee voluntarily resigns and subsequently competes with the Company, his Option shall not be deemed vested or exercisable to any extent; (ii) in the event that an employee's employment is terminated because of death or disability, any Option granted to him shall be deemed vested and exercisable to the extent of 30% of the total number of Shares to which it pertains one year after the date it is granted, an additional 10% beginning on the second anniversary of the date it is granted; and (iii) all Options shall be exercisable in full upon the occurrence of a Change in Control of the Company. For purposes of this Article 5(e) and Article 5(a), termination of employment shall be considered to occur when an employee is no longer a full-time employee of the Company or of any parent or subsidiary corporation of the Company; whether an authorized leave of absence or absence on military or government service shall constitute termination of employment for purposes of the 1985 Incentive Plan shall be determined by the Committee; and the Committee shall determine whether a termination is with or without cause, a voluntary retirement, due to disability, or whether an optionee subsequent to termination competes with the Company. For purposes of this Article 5(e), a "Change in Control" shall be deemed to have occurred if (a) any "person" or "group" (as such terms are used in Section 13(d)(3) and 14(d)(2) of the Exchange Act) other than the Company is or becomes the beneficial owner, directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of the Company's then outstanding securities; or (b) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors of the Company cease for any reason to constitute at least a majority thereof unless the election, or the nomination for election by the Company's shareholders, of each new director was approved by a vote of at least two-thirds of the directors of the Company then still in office who were directors of the Company at the beginning of the period. (f) Serial Exercise: For grants of ISOs prior to 1987, the Option Agreement shall provide that an ISO shall not be exercisable and no put or call shall be allowed while there is outstanding any incentive stock option as defined in Section 422A of the Code previously granted under the 1985 Incentive Plan or under another incentive stock option plan as defined in Section 422A of the Code to the optionee with respect to stock in a member of the Employer Group. For this purpose, an incentive stock option shall be considered outstanding until it is exercised in full or expires by reason of lapse of time. For Options granted after 1986, the Option Agreement shall not contain such sequential exercise requirement. (g) Non-Transferability: An Option shall be exercisable during the optionee's lifetime only by him or his Permitted Transferee (as hereinafter defined) and after his death only by his personal representative or Permitted Transferee, and the Option shall not be assignable or transferable by him, otherwise (i) than by will or the laws of descent or distribution, (ii) pursuant to a qualified domestic relations order, as defined by the Internal Revenue Code or Title I of the Employee Retirement Income Security Act, or the rules thereunder, or (iii) to a Permitted Transferee if the stock option agreement provides for such transferability and no consideration is received by the optionee for such transfer. For purposes of this Article 5(g), a "Permitted Transferee" shall be a member of the immediate family (i.e., parent, spouse or child) of the optionee. Once so transferred, it shall not be further transferable. Any transferee shall be required to provide evidence of transfer satisfactory to the Committee. No transfer by the optionee by will or the laws of descent and distribution shall be effective to bind the Company unless the Company shall have been furnished with written notice thereof and a copy of the will and/or such other evidence as the Committee may deem necessary to establish the validity of the transfer and the acceptance by the transferee or transferees of the terms and conditions of the Option. (h) Investment Representation: Each Option Agreement may provide that, upon demand by the Committee for such a representation, the optionee (or any permissible transferee of the option under Article 5(g)) shall deliver to the Committee at the time of any exercise of an Option or portion thereof a written representation that the Shares to be acquired upon such exercise are to be acquired for investment and not for resale or with a view to the distribution thereof. Upon such demand, delivery of such representation prior to the delivery of any Shares issued upon exercise of an Option and prior to the expiration of the Option period shall be a condition precedent to the right of the optionee or such other transferee to purchase any Shares. (i) Adjustments in Event of Change in Voting Shares: In the event of any change in the voting Shares of the Company by reason of any stock dividend, recapitalization, reorganization, merger, consolidation, split-up, combination, or exchange of voting Shares at a price substantially below fair market value, or rights offering to purchase voting Shares, or of any similar change affecting the voting Shares, the number and kind of Shares which thereafter may be optioned and sold under the 1985 Incentive Plan and the number and kind of Shares subject to option in outstanding option agreements and the purchase price per share thereof shall be appropriately adjusted consistent with such change in such manner as the Committee may deem equitable in its discretion to prevent substantial dilution or enlargement of the rights granted to, or available for, participants in the 1985 Incentive Plan. (j) Rights as a Shareholder: An optionee or a transferee of an Option shall have no rights as a shareholder with respect to Shares covered by his Option until the date as of which a stock certificate is issued to him for such Shares. No adjustment shall be made for dividends (ordinary or extraordinary, whether in cash, securities or other property) or distributions or other rights for which the record date is prior to the date such stock certificate is issued. (k) No Right to Continued Employment: The Option Agreement shall not confer upon the optionee any right with respect to continuance of employment by the Company or a parent or subsidiary corporation of the Company, nor shall it interfere in any way with the right of his employer to terminate his employment at any time. (1) Definition of Cause: The term "cause" in the context of a termination of employment means only one or more of the following: (a) the commission in the course of employment of any dishonest or fraudulent act; (b) conviction of a felony (from which, through lapse of time or otherwise, no successful appeal shall have been made) whether or not committed in the course of employment; (c) the willful refusal to carry out reasonable instructions of the Chairman of the Board of Directors of the Company which has a material adverse affect upon the Company; and (d) the willful disclosure of any trade secrets or confidential corporate information to persons not authorized to know same. (m) Other Provisions: The Committee may, as a condition precedent to the exercise of any Option, require the holder of the Option (including, in the event of his death, his legal representatives, legatees or distributees) to enter into such agreements or to make such representations as may be required to make lawful under the laws of the U.S. or any foreign country the exercise of the Option and the ultimate disposition of the Shares acquired by such exercise. The Option Agreements authorized under the 1985 Incentive Plan shall contain such other provisions, consistent with the 1985 Incentive Plan, as the Committee shall deem advisable. 6. Term of 1985 Incentive Plan: Subject to Article 8, the 1985 Incentive Plan shall remain in effect until all Shares subject or which may become subject to the 1985 Incentive Plan shall have been purchased pursuant to Options; provided that no grant shall be made under the 1985 Incentive Plan after December 15, 1997. 7. Indemnification of Committee: To the full extent permitted by law, the Company shall indemnify each person made or threatened to be made a party to any civil or criminal action or proceeding by reason of the fact that he, or his testator or intestate, is or was a member of the Committee. 8. Amendment of the 1985 Incentive Plan: The Board of Directors of the Company may from time to time amend, suspend or discontinue the 1985 Incentive Plan, provided, however that, subject to the provisions of Article 5(i), no action of the Board of Directors or of the Committee may: (i) increase the number of Shares subject to the 1985 Incentive Plan pursuant to Article 4; (ii) permit the granting of any Option at a price less than that determined in accordance with Articles 5(c); or (iii) permit the granting of Options which expire beyond the period provided for in Article 5(a). Without the written consent of an optionee, no amendment or suspension of the 1985 Incentive Plan shall alter or impair any Option previously granted to him under the 1985 Incentive Plan. 9. Application of Funds: The proceeds received by the Company from the sale of Shares pursuant to Options will be used for general corporate purposes. 10. No Obligation to Exercise Option: The granting of an Option shall impose no obligation upon the optionee to exercise such Option. EX-5 3 Exhibit 5 June 10, 1994 Wellman, Inc. 1040 Broad Street Shrewsbury, NJ 07702 Ladies and Gentlemen: This opinion is furnished in connection with the filing by Wellman, Inc. (the "Company") of a Registration Statement on Form S-8/S-3 (the "Registration Statement") registering under the Securities Act of 1933, as amended, 1,500,000 shares of Common Stock, $.001 par value (the "Common Stock"), to be issued pursuant to stock options under the Company's Amended and Restated 1985 Incentive Stock Option Plan (the "Plan"). As counsel for the Company, we participated in the preparation of the Registration Statement and have examined such other certificates and documents as we deemed necessary or appropriate for the purposes of this opinion. Based upon the foregoing, we are of the opinion that the shares of Common Stock being registered by the Registration Statement, when issued nad paid for as contemplated by the Plan, will be validly issued, fully paid and non-assessable. We hereby consent to the reference to our firm in the Registration Statement. Very truly yours, EDWARDS & ANGELL EX-23 4 Exhibit 23(a) CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" in the Registration Statement on Form S-8/S-3 pertaining to the Wellman, Inc. Amended and Restated 1985 Incentive Stock Option Plan and in the related Prospectuses and to the incorporation by reference therein of our report dated February 15, 1994 with respect to the consolidated financial statements and schedules of Wellman, Inc. included in its Annual Report (Form 10-K) for the year ended December 31, 1993, filed with the Securities and Exchange Commission. ERNST & YOUNG Charlotte, North Carolina June 10, 1994 Exhibit 23(b) CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the capiton "Experts" in the Registration Statement on Form S-8/S-3 pertaining to the Wellman, Inc. 1985 Amended and Restated Incentive Stock Option Plan and in the related Prospectuses and to the incorporation by reference therein of our report dated 17 February 1994, with respect to the consolidated financial statements of Wellman Internationsl Limited and subsidiary at 31 December 1993 and 1992, and for each of the three years in the period ended 31 December 1993, included in Wellman, Inc.'s Annual Report (Form 10-K) for the year ended 31 December 1993, filed with the Securities and Exchange Commission. KPMG STOKES KENNEDY CROWLEY Chartered Accountants Registered Auditors Dublin, Ireland 10 June 1994 -----END PRIVACY-ENHANCED MESSAGE-----