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(As amended on 5/2/95)
CDI CORP.
NON-QUALIFIED STOCK OPTION AND STOCK APPRECIATION RIGHTS PLAN
1. Purpose. The purpose of this plan ("Plan") is to provide a
more effective method of compensating employees, consultants and
directors of the Company than is currently available and to complement
the other incentive plans of the Company, thus encouraging greater
personal interest in the success of the Company on the part of such
personnel and furnishing them with a further incentive to remain with
the Company and to increase their efforts on its behalf.
2. Definitions:
(a) "Board" means the board of directors of the Parent
Company.
(b) "Committee" means the committee described in Paragraph 5.
(c) "Company" means CDI Corp. and each of its Subsidiary
Companies.
(d) "Date of Exercise" means the date on which notice of
exercise of an Option or SAR is delivered to the Parent
Company.
(e) "Date of Grant" means the date on which an Option or SAR
is granted.
(f) "Eligible Director" means any director of the Parent
Company who is neither a full-time employee of the
Parent Company or any Subsidiary Company nor a member of
the Committee.
(g) "Fair Market Value" means the closing price of actual
sales of Shares on the New York Stock Exchange on a given
date or, if there are no such sales on such date, the
closing price of the Shares on such Exchange on the last
date on which there was a sale.
(h) "Holder" means a person to whom an SAR not attached to an
Option has been granted under the Plan, which SAR has not
been exercised and has not expired or terminated.
(i) "Option" means a non-qualified stock option granted under
the Plan and described in Paragraph 4(a).
(j) "Optionee" means a person to whom an Option or an Option
with an SAR attached has been granted under the Plan,
which Option or SAR has not been exercised and has not
expired or terminated.
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(k) "Parent Company" means CDI Corp.
(l) "Retainer Fee" means the annual retainer fee payable to
directors of the Board who are not full-time employees
of the Parent Company or any Subsidiary Company for
their service as directors of the Parent Company during
a Retainer Fee Year. A Retainer Fee does not include
attendance or committee fees.
(m) "Retainer Fee Option" means any Option granted to an
Eligible Director in partial payment of such Eligible
Director's Retainer Fee, whether such Option is granted
automatically or by election of the Eligible Director
pursuant to the terms of this Plan.
(n) "Retainer Fee Year" means the one year period between
consecutive annual meetings of the shareholders of the
Parent Company, beginning on the date immediately
following the annual meeting.
(o) "SAR" means a stock appreciation right granted under the
Plan and described in Paragraphs 4(b) or 4(c).
(p) "Shares" means shares of common stock, par value $.10
per share, of the Parent Company.
(q) "Subsidiary Company" means any corporation controlled by
the Parent Company or by a subsidiary controlled by the
Parent Company ("control" having the meaning set forth
in Section 368(c) of the Internal Revenue Code or
corresponding provisions of successor laws), provided
that if the corporation is controlled by a subsidiary of
the Parent Company, either the Parent Company must own
100% of the stock of the subsidiary or the subsidiary
must own 100% of the stock of the corporation.
(r) "Value" of an SAR shall mean the excess of the Fair
Market Value of a Share on the Date of Exercise over an
amount fixed by the Committee on the Date of Grant (the
"SAR Reference Price"); provided that the SAR Reference
Price may not be less than 50% of the Fair Market Value
of a Share on the Date of Grant. Where an SAR is
attached to an Option, the SAR Reference Price shall be
equal to the Option price of one Share under the attached
Option.
3. Shares Subject to the Plan. On and after April 30, 1991, not
more than 1,100,000 Shares may be delivered pursuant to the exercise of
Options or SARs under the Plan. The Shares so delivered may, at the
election of the Company, be either treasury Shares or Shares originally
issued for the purpose. When an Option is granted (whether or not
attached to an SAR), the number of Shares subject to such Option shall
be reserved for issuance out of the Shares remaining available for
grant under the Plan. When SARs not attached to an Option are granted,
there shall be reserved for issuance thereunder Shares in an amount
equal to one-half of the number of SARs granted. If Options or SARs
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granted under the Plan terminate or expire without being exercised in
whole or in part, other Options or SARs may be granted covering the
Shares not delivered. No individual shall be eligible to receive, in
any one calendar year, Options or SARs with respect to more than
400,000 Shares (which number is subject to adjustment as provided in
Paragraph 15 hereof).
4. Rights to be Granted. Rights which may be granted under the
Plan are:
(a) Options, which give the Optionee the right for a specified
time period to purchase a specified number of Shares at a specified
price;
(b) SARs, which are attached to Options and which give the
Optionee the right for a specified time period, without payment to the
Company, to receive the Value of such SARs, to be paid in cash and
Shares in accordance with Paragraph 9 below, in lieu of purchasing
Shares under the related Option; and
(c) SARs, which are not attached to Options and which give the
Holder the right for a specified time period, without payment to the
Company, to receive the Value of such SARs, to be paid in cash and
Shares in accordance with Paragraph 9 below.
5. Administration. The Plan shall be administered by the Stock
Option Committee, which shall be composed of not less than two
directors of the Parent Company, appointed by the Board, none of whom
shall be eligible (or shall have been eligible within one year prior to
the date of their appointments) to be granted Options or SARs under the
Plan or to be selected as a participant under any other discretionary
plan of the Company or any of its affiliates entitling them to acquire
stock, stock options or stock appreciation rights of the Company or any
of its affiliates. Except with respect to Retainer Fee Options, the
Committee may determine from time to time which eligible participants
shall be granted Options or SARs under the Plan, the number of Shares
to be subject to the Option in each case, the number and type of SARs,
if any, to be awarded in each case, and the other substantive
provisions of each Option and SAR agreement. However, any Options,
other than Retainer Fee Options, or SARs granted to a member of the
Board must also be approved by a majority of the Board not including
the recipient. At least 60 days before the next annual meeting of
shareholders of the Parent Company, the Committee may determine that
Retainer Fee Options will not be made available with respect to the
Retainer Fees to be earned during the Retainer Fee Year beginning on
the day following such annual meeting.
6. Retainer Fee Options.
(a) Mandatory Retainer Fee Options. Unless the Committee
determines, as provided in Paragraph 5, not to make Retainer Fee
Options available with respect to a Retainer Fee Year, an Eligible
Director will be granted, on the first business day of such Retainer
Fee Year, Retainer Fee Options, having a value, determined in
accordance with Paragraph 6(c), equal to one half of the cash value of
his Retainer Fee for such Retainer Fee Year.
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(b) Elective Retainer Fee Options. Unless the Committee
determines, as provided in Paragraph 5, not to make Retainer Fee
Options available with respect to a Retainer Fee Year, an Eligible
Director may, in lieu of receiving in cash all or any portion of his
Retainer Fee due in cash for such Retainer Fee Year, irrevocably elect
to receive Retainer Fee Options having a value, determined in
accordance with Paragraph 6(c), equal to the portion of such Retainer
Fee he elects not to receive in cash. This election must be made by an
Eligible Director no later than the day before the first day of such
Retainer Fee Year. Grants made pursuant to such an Eligible Director's
election will be made on the first business day that is six months
after the first day of the Retainer Fee Year.
(c) Value of Retainer Fee Options. For purposes of this
Paragraph 6 and unless otherwise determined by the Committee, the value
of a Retainer Fee Option to purchase one Share shall equal 25% (the
"Option Percentage") of the Fair Market Value of one Share on the last
trading day immediately preceding the Date of Grant; provided, however,
that the Committee may change the Option Percentage only if such change
is made at least 60 days before the beginning of any Retainer Fee Year
in which Retainer Fee Options affected by such change would be granted.
Retainer Fee Options to purchase fractional Shares shall not be
granted; instead the number of Shares for which a Retainer Fee Option
is exercisable shall be rounded down to eliminate any fractional Share.
If the Committee determines that another method of valuing Retainer Fee
Options would be more appropriate, the Committee may implement an
alternative method of determining the value of Retainer Fee Options.
(d) Terms of Retainer Fee Options. The Committee may determine
from time to time the terms of the Retainer Fee Options, provided such
terms are consistent with the terms of the Plan. Unless otherwise
determined by the Committee, (a) Retainer Fee Options shall not vest
until (and therefore will not be exercisable until) one year after the
Date of Grant and (b) if an Eligible Director ceases to be a member of
the Board for any reason: (i) unvested Retainer Fee Options shall
expire and be unexercisable and the portion of the Eligible Director's
Retainer Fee earned as of the date of cessation that is represented by
such unvested Retainer Fee Options shall be paid in cash, and (ii)
Retainer Fee Options elected, but not granted prior to such cessation,
shall not be granted and the portion of the Retainer Fee earned but not
paid in such Retainer Fee Options shall be paid in cash.
7. Eligibility. Eligible participants under the Plan shall be all
salaried employees, consultants and directors of the Parent Company or
any Subsidiary Company, except members of the Committee. Only Eligible
Directors shall be eligible to receive Retainer Fee Options pursuant to
Paragraph 6.
8. Option Exercise Price.
(a) The price at which Shares may be purchased on exercise of an
Option shall be determined in each case by the Committee, but may not
be less than 50% of the Fair Market Value of the Shares on the Date of
Grant; provided, however, that unless otherwise determined by the
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Committee, the price at which Shares may be purchased on exercise of a
Retainer Fee Option shall be the Fair Market Value of the Shares on the
last trading day immediately preceding the Date of Grant.
(b) Upon exercise of any Option granted pursuant to this Plan,
the Optionee shall pay to the Parent Company the full Option price:
(i) By check or in cash; or
(ii) By delivering to the Parent Company certificates for
Shares owned by the Optionee and endorsed to the Parent
Company representing a number of Shares having a then
current Fair Market Value equal to the Option price; or
(iii) Any combination of the above.
Upon payment of the Option price the appropriate accounts of the Parent
Company shall then be credited accordingly.
9. Issuance of Certificates; Payment of Cash.
(a) Upon payment of the Option price, a certificate for the
number of whole Shares and a check for the Fair Market Value on the
Date of Exercise of the fractional Share, if any, to which the Optionee
is entitled shall be delivered to such Optionee by the Parent Company,
provided that the Optionee has remitted to his employer an amount,
determined by such employer, sufficient to satisfy the applicable
requirements to withhold federal, state, and local taxes, or made other
arrangements with his employer for the satisfaction of such withholding
requirements.
(b) Upon exercise of SARs, the Value of such SARs shall be paid
one-half in cash and one-half in Shares. The number of Shares to be
delivered by the Parent Company shall be an amount equal to 50% of the
Value of such SARs divided by the Fair Market Value of a Share on the
Date of Exercise of such SARs. Any right to a fractional Share shall
be satisfied by the Parent Company in cash. The employer of the
Optionee or Holder shall deduct from the amount of cash payable any
amount necessary to satisfy applicable federal, state, or local
withholding requirements.
10. Term. Unless otherwise determined by the Committee, Options
or SARs granted under the Plan shall not be exercisable after five
years from the Date of Grant.
11. Exercise of Options and SARs. Unless otherwise determined by
the Committee and subject to the provisions of Paragraphs 12 and 14, an
Option or SAR may be exercised in whole or in part during its term,
provided that an Option or SAR shall be exercisable only by the
Optionee or Holder during his lifetime and, unless otherwise determined
by the Committee and subject to the provisions of Paragraph 6, only
while he is a salaried employee, consultant or director of the Parent
Company or of a Subsidiary Company.
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12. Death or Termination of Qualifying Relationship. Unless
otherwise determined by the Committee, Options (other than Retainer Fee
Options) and SARs shall terminate upon the termination for any reason
of the Optionee's or Holder's qualifying relationship with the Company,
except that if an Optionee or Holder dies while holding a vested Option
or SAR not fully exercised or expired, the unexercised portion may be
exercised by his estate or his heirs or beneficiaries within the period
of six months following the date of death (in no event, however, may an
Option or SAR be exercised after its stated date of expiration). For
purposes of this Plan, a transfer of a participant between two
employers, each of which is a part of the Company, shall not be deemed
a termination of employment.
13. Relationship Between Options and SARs. Upon exercise of an
Option, any SAR attached to such Option shall automatically expire.
Upon exercise of an SAR attached to an Option, the related Option shall
automatically expire. Except as set forth above, the grant, exercise,
termination or expiration of any Option granted to an Optionee or
Holder shall have no effect upon any SAR held by such Optionee or
Holder, and the grant, exercise, termination or expiration of an SAR
granted to any Optionee or Holder shall have no effect upon any Option
held by such Optionee or Holder.
14. Transferability of Options and SARs. No Option or SAR may be
transferred except by will or the applicable laws of descent and
distribution.
15. Adjustment on Change in Capitalization. In case the number of
outstanding Shares is changed as a result of a stock dividend, stock
split, recapitalization, combination, subdivision, issuance of rights
or other similar corporate change, the Board shall make an appropriate
adjustment in the aggregate number of Shares which may be issued under
the Plan, in the per individual annual limitation set forth in
Paragraph 3 above and in the number of Shares subject to, and the
Option price or Value of, any then outstanding Options or SARs.
16. Certain Corporate Transactions. If during the term of any
Option or SAR, or after an Eligible Director has elected to receive,
but before he has received, Retainer Fee Options, the Parent Company or
any of the Subsidiary Companies shall be merged into or consolidated
with or otherwise combined with or acquired by another person or
entity, or there is a divisive reorganization or a liquidation or
partial liquidation of the Parent Company, the Parent Company may (but
shall not be required to) take any of the following courses of action:
(a) Not less than 10 days nor more than 60 days prior to any such
transaction, all Optionees and Holders shall be notified that their
Options and SARs shall expire on the 10th day after the date of such
notice, in which event all Optionees and Holders shall have the right
to exercise all of their Options and SARs prior to such new expiration
date; or
(b) The Parent Company shall provide in any agreement with
respect to any such merger, consolidation, combination or acquisition
that the surviving, new or acquiring corporation shall grant options
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and stock appreciation rights to the Optionees and Holders to acquire
shares, or stock appreciation rights in shares, in such corporation
provided that the excess of the fair market value of the shares of such
corporation immediately after the consummation of such merger,
consolidation, combination or acquisition over the option price, or the
value of such stock appreciation rights at the time of grant, shall not
be greater than the excess of the Fair Market Value of the Shares over
the Option price of Options, or the Value of the SARs as determined
under Paragraph 2(r), immediately prior to the consummation of such
merger, consolidation, combination or acquisition; or
(c) Cancel an Eligible Director's right to receive Retainer Fee
Options elected, but not yet granted, and on the date the Eligible
Directors would otherwise have received Retainer Fee Options, the
Parent Company or any successor corporation shall pay the Retainer Fees
to which such elected but ungranted Retainer Fee Options relate in
cash; or
(d) The Parent Company shall take such other action as the Board
shall determine to be reasonable under the circumstances in order to
permit Optionees, Holders and Eligible Directors to realize the value
of rights granted to them under the Plan.
17. Plan Not to Affect Relationship With the Company. Neither the
Plan nor any Option or SAR shall confer upon any participant any right
to continue in the service of the Company.
18. Amendment. The Board may at any time terminate the Plan or
make such changes therein as it shall deem advisable. The Board may
not, however, without the approval of the voting shareholders of the
Parent Company, (i) increase the total number of Shares which may be
delivered under the Plan, (ii) change the class of persons eligible to
receive Options or SARs, (iii) withdraw the authority to administer the
Plan from a committee consisting of directors or (iv) otherwise amend
the Plan in a manner which would require the approval of the
shareholders of the Parent Company in order to maintain the exemption
available under Rule 16b-3 (or any similar rule) of the Securities and
Exchange Commission. No outstanding Option or SAR shall be affected by
any such amendment without the written consent of the Optionee, Holder
or other person then entitled to exercise such Option or SAR.
19. Securities Laws. The Committee shall make each grant under
the Plan subject to such conditions as shall cause both the grant and
exercise of any Option or SAR to comply with the then-existing
requirements of Rule 16b-3 (or any similar rule) of the Securities and
Exchange Commission.
Unless otherwise permitted by the Committee, the date of any
exercise of an SAR by a Holder or an Optionee who is an officer,
director or beneficial owner of ten percent or more of any class of any
registered equity security of the Parent Company shall be required to
occur within the period beginning with the third and ending with the
twelfth business day after the date of the release of the Parent
Company's quarterly or annual sales and earnings information to the
public.
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20. Performance-Based Compensation. Unless otherwise provided by
the Committee in their discretion pursuant to the first sentence of
Paragraph 8(a), it is intended that all compensation income recognized
by employees as the result of the exercise of Options or SARs, or the
disposition of Shares acquired on exercise of Options or SARs, shall be
considered performance-based compensation excludable from such
employee's "applicable employee remuneration" pursuant to section
162(m)(4)(C) of the Internal Revenue Code of 1986, as amended.
21. General. Each Option or SAR granted shall be evidenced by a
written instrument containing such terms and conditions not
inconsistent with the Plan as the Committee may determine. The
issuance of Shares on the exercise of an Option or SAR shall be subject
to all of the applicable requirements of the Pennsylvania Business
Corporation Law and other applicable laws. Among other things the
Optionee or Holder may be required to deliver an investment
representation to the Company in connection with any exercise of an
Option or SAR or to agree to refrain from selling or otherwise
disposing of the Shares acquired for a specified period of time.