Company Name: American Bar Ass'n.
Public Availability Date: 05-01-1989

INQUIRY LETTER

American Bar Association
750 North Lake Shore Drive
Chicago, Illinois 60611
TELEPHONE(312) 988-5588

April 26, 1989

William E. Morley, Esq.
Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, DC 20549

Re: Securities Act of 1933 - Form S-8

Dear Mr. Morley:

On February 14, 1989, you responded to my letter of November 23, 1988 concerning the availability of the Form S-8 registration statement for sales to terminated employees upon exercise of options granted pursuant to employee benefit plans. I am writing to seek a clarification of the last sentence of your response in which you wrote that the Division's view as to the availability of Form S-8 was "conditioned upon the fact that the exercise will be pursuant to the terms of an employee stock option plan that specifically provides for the continued exercisability of the options for a period of time after retirement, death or other termination of employment."

As you know some stock option plans simply authorize the Board or Compensation Committee to establish the terms of exercise within broad limits and without specifying how long options may be exercisable after termination of employment. Other plans are more specific on that question but grant the Board or Committee authority to vary the terms of exercise in particular cases.

Concern has been expressed that, to satisfy the condition set forth in the last sentence of your February 14, 1989 letter, companies might be required to amend plans that afford Boards of Directors and Compensation Committees broad latitude with regard to the terms of exercisability following termination of employment. It is our understanding that your intention was not to require a change in existing practice. Accordingly, we hereby request a further interpretation to the effect that Form S-8 is available for sales of an issuer's securities to terminated employees upon the exercise of non-transferable stock options granted pursuant to an employee benefit plan so long as such exercises are permitted under the plan and, to the extent required by the plan, have been approved by the Board of Directors or Committee having authority to grant options under the plan.

If you have any questions or would like to discuss this matter with the undersigned (617) 951-7291 or other members of the Subcommittee, please let me know. I would appreciate it if you would send a copy of your reply to me at my office (c/o Ropes & Gray, One International Place, Boston, MA 02110).

Sincerely,

Donald W. Glazer
Co-Chairman, Subcommittee
on Employee Benefits and
Executive Compensation
Committee on Federal
Regulation of Securities

STAFF REPLY LETTER

MAY 1 1989

Donald W. Glazer, Esq.
Co-Chairman, Subcommittee on
Employee Benefits and Executive
Compensation
American Bar Association
c/o Ropes & Gray
225 Franklin Street
Boston, Massachusetts 02110

Dear Mr. Glazer:

This is in response to your letter of April 26, 1989 requesting clarification of my letter of February 14, 1989 concerning the availability of the Form S-8 registration statement for certain exercises of stock options.

It is the Division's view that Form S-8 is available for sales of an issuer's securities to terminated employees upon the exercise of non-transferable stock options granted pursuant to an employee benefit plan so long as such exercises are permitted under the plan and, to the extent required by the plan, have been approved by the Board of Directors or Committee having authority to grant options under the plan.

Sincerely,

William E. Morley
Chief Counsel
Associate Director (Legal)