Exhibit 10.13
EQUITABLE RESOURCES, INC.
NON-EMPLOYEE DIRECTORS' STOCK INCENTIVE PLAN
Section 1. Purpose
1.01 The purpose of the 1994 Equitable Resources, Inc.
Non-Employee Directors' Stock Incentive Plan (the "Plan") is to
assist Equitable Resources, Inc. (together with any successor
thereto, the "Company") in attracting and retaining the
services of non-employee directors who exhibit a high degree of
business responsibility, personal integrity and
professionalism.
Section 2. Definitions; Construction
2.01 Definitions. In addition to the terms defined
elsewhere in the Plan, the following terms as used in the Plan
shall have the following meanings when used with initial
capital letters:
2.01.1 "Award" means any Option or Restricted Stock
granted under the Plan.
2.01.2 "Award Agreement" means any written agreement,
contract or other instrument or document evidencing an
Award.
2.01.3 "Board" means the Company's Board of Directors.
2.01.4 "Code" means the Internal Revenue Code of 1986,
as amended from time to time, together with rules,
regulations and interpretations promulgated thereunder.
2.01.5 "Committee" means the Compensation Committee or
such other Committee of the Board as may be designated by
the Board to administer the Plan, as referred to in Section
3.01 hereof.
2.01.6 "Common Stock" means the shares of the common
stock, without par value, and such other securities of the
Company as may be substituted for Shares pursuant to
Section 8.01 hereof.
2.01.7 "Disability" means that a Participant is
disabled within the meaning of Section 422 (c) (6) of the
Code.
2.01.8 "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
2.01.9 "Fair Market Value" of shares of any stock,
including but not limited to Common Stock, or
units of any other securities (herein "shares"), shall be
the mean between the following prices, as applicable, for
the date as of which Fair Market Value is to be determined
as quoted in The Wall Street Journal (or in such other
reliable publication as the Committee, in its discretion,
may determine to rely upon): (a) if the shares are listed
on the New York Stock Exchange, the highest and lowest
sales prices per share as quoted in the NYSE-Composite
Transactions listing for such date, (b) if the shares not
listed on such exchange, the highest and lowest sales
prices per share for such date on (or on any composite
index including) the principal United States securities
exchange registered under the Exchange Act on which the
shares are listed, or (c) if the shares are not listed on
any such exchange, the highest and lowest sales prices per
share for such date on the National Association of
Securities Dealers Automated Quotations System or any
successor system then in use ("NASDAQ"). If there are no
such sale price quotations for the date as of which Fair
Market Value is to be determined but there are such sale
price quotations within a reasonable period both before and
after such date, then Fair Market Value shall be determined
by taking a weighted average of the means between the
highest and lowest sales prices per share as so quoted on
the nearest date before and the nearest date after the date
as of which Fair Market Value is to be determined. The
average should be weighted inversely by the respective
numbers of trading days between the selling dates and the
date as of which Fair Market Value is to be determined. If
there are no such sale price quotations on or within a
reasonable period both before and after the date as of
which Fair Market Value is to be determined, then Fair
Market Value of the shares shall be the mean between the
bona fide bid and asked prices per share as so quoted for
such date on NASDAQ, or if none, the weighted average of
the means between such bona fide bid and asked prices on
the nearest trading date before and the nearest trading
date after the date as of which Fair Market Value is to be
determined, if both such dates are within a reasonable
period. The average is to be determined in the manner
described above in this Section 2.01.9. If the Fair Market
Value of shares on the date as of which Fair Market Value
is to be determined cannot be determined on the basis
previously set forth in this Section 2.01.9, or if a
determination is required as to the Fair Market Value on
any date of property other than shares, the Committee shall
in good faith determine the Fair Market Value of such
shares or other property on such date. Fair Market Value
shall be determined without regard to any restriction other
than a restriction which, by its terms, will never
lapse.
2.01.10 "Option" means a right, granted under Section
6.04 hereof, to purchase Shares at a specified price during
specified time periods as provided in Section 6.03. Each
Option shall be a nonstatutory stock option, which is an
Option not intended to meet the requirements of Section 422
of the Code or any successor provision thereto.
2.01.11 "Participant" means at any time any person who
is a member of the Board, but who is not at the time a
full-time employee of the Company or any Subsidiary nor has
been a full-time employee during the preceding 12-month
period. The term "Participant" does not include advisory,
emeritus or honorary directors.
2.01.12 "Person" shall have the meaning assigned in the
Exchange Act.
2.01.13 "Restricted Stock" means Shares, granted under
Section 6.04 hereof, that are subject to restrictions as
provided in Section 6.02.
2.01.14 "Retirement" means that a Participant ceases to
be a member of the Board for any reason on or after
reaching the age of fifty-eight (58) years with at least
sixty (60) months of service as a Director. Service shall
include the time a Director was an employee Director.
2.01.15 "Rule 16b-3" means Rule 16b-3 under the
Exchange Act, as amended from time to time, or any
successor to such Rule promulgated by the Securities and
Exchange Commission under Section 16 of the Exchange Act.
2.01.16 "Shares" means the common stock of the
Company, without par value, and such other securities of
the Company as may be substituted for Shares pursuant to
Section 8.01 hereof
2.01.17 "Subsidiary" means any corporation in an
unbroken chain of corporations beginning with the Company,
if each of the corporations other than the last corporation
in the chain owns stock possessing at least 50% of the
total combined voting power of all classes of stock in one
of the other corporations in the chain.
Definitions of the terms "Change of Control," "Change of
Control Price," "Potential Change of Control...... Related
Party," "Voting Securities or Security" and "Beneficial
Ownership" are set forth in Section 9.03 hereof
2.02 Construction. For purposes of the Plan, the
following rules of construction shall apply:
2.02.1 The word "or" is disjunctive but not
necessarily exclusive.
2.02.2 Words in the singular include the plural;
words in the plural include the singular, words in the
neuter gender include the masculine and feminine genders,
and words in the masculine or feminine gender include the
other and neuter genders.
Section 3. Administration
3.01 The Plan shall be administered by the Committee,
members of which receive no additional compensation for such
administrative service. All Awards will be automatic and
nondiscretionary pursuant to the terms of the Plan. The
Committee shall have full and final authority to take the
following actions, in each case subject to and consistent with
the provisions of the Plan:
(i) to interpret and administer the Plan and any
instrument or agreement relating to, or Award granted
under, the Plan;
(ii) to adopt, amend, suspend, waive and rescind such
rules and regulations as the Committee may deem necessary
or advisable to administer the Plan;
(iii) to correct any defect or supply any omission or
reconcile any inconsistency, and to construe and interpret
the Plan, the rules and regulations, any Award Agreement or
other instrument entered into or Award granted under the
Plan; and
(iv) to make all other decisions and determinations as
may be required under the terms of the Plan or as the
Committee may deem necessary or advisable for the
administration of the Plan.
Any action of the Committee with respect to the Plan shall
be final, conclusive and binding on all Persons, including the
Company, Participants, any Person claiming any rights under the
Plan from or through any Participant and shareholders. The
express grant of any specific power to the Committee, and the
taking of any action by the Committee, shall not be construed
as limiting any power or authority of the Committee. The
Committee may delegate to officers or managers of the Company
the authority, subject to such terms as the Committee shall
determine, to perform administrative functions under the Plan.
Each member of the Committee shall be entitled to, in good
faith, rely or act upon any report or other information
famished to him by any officer, manager or other employee of
the Company, the Company's independent certified public
accountants, or any executive compensation consultant or other
professional retained by the Company to assist in the
administration of the Plan. Any and all powers, authorizations
and discretion s granted by the Plan to the Committee shall
likewise be exercisable at any time by the Board.
Notwithstanding the above or any provisions of the Plan to
the contrary, (1) the selection of Participants to whom Awards
are to be granted, the number of shares subject to any Award,
the exercise price of any Option, the periods during which any
Option may be exercised, the term of any Option, the minimum
restrictions to which Restricted Stock shall be subject and the
duration of such restrictions shall be as hereinafter provided,
and the Committee shall have no discretion as to such matters
and (2) in no event shall the Committee or the Board have any
power of authority which would cause the Plan to fail to be a
plan described in Rule 16b-3 (c) (2) (ii).
Section 4. Shares Subject to the Plan
4.01 The maximum number of shares of Common Stock in
respect of which Awards may be granted under the Plan, subject
to adjustment as provided in Section 8.01 of the Plan, shall be
80,000.
For purposes of this Section 4.01, the number of Shares to
which an Award relates shall be counted against the number of
Shares reserved and available under the Plan at the time of
grant of the Award. If any Award is forfeited, or an Option
otherwise terminates without being exercised in full, any
Shares counted against the number of Shares reserved and
available under the Plan with respect to such Award shall, to
the extent of any such forfeiture or termination, again be
available for Awards under the Plan; provided, however, that
forfeited Shares of Restricted Stock may not again be made
available to the extent the Participant received dividends or
other benefits of ownership (not including voting rights) prior
to such forfeiture. The payment of the exercise price of an
Option in Shares shall not increase the number of Shares
available under the Plan.
Any Shares distributed pursuant to an Award may consist,
in whole or in part, of authorized and unissued Shares or of
treasury Shares, including Shares repurchased by the Company
for purposes of the Plan.
Section 5. Eligibility
5.01 Awards shall be granted only to Participants as
defined in Section 2.01.1 1.
Section 6. Specific Terms of Awards
6.01 General Awards shall be granted only as set forth in
this Section 6. Awards shall be granted for no consideration
other than prior and future services.
6.02 Terms of Restricted Stock. Restricted Stock shall be
granted to Participants on the following terms and conditions:
(i) Restriction Period. Shares of Restricted Stock
shall be subject to the restrictions provided in this
Section 6.02 during the period (the "Restriction Period")
commencing on the date of grant and ending six months after
the date of approval of the Plan by the shareholders of the
Company as provided in Section 12.01.
(ii) Restrictions. During the Restriction Period,
Shares of Restricted Stock may not be sold, assigned,
transferred or encumbered by the Participant, and
certificates for such Shares shall be deposited with the
Company in escrow. Subject to the foregoing restrictions,
from the date of grant of Restricted Stock, and unless and
until such Shares are deemed forfeited to the Company as
provided herein, the Participant shall be a shareholder
with respect to the Restricted Stock, and shall have all of
the rights of a shareholder with respect to such Shares,
including the right to vote such Shares and to receive all
dividends and other distributions paid with respect to such
Shares, except that any dividend or distribution payable
during the Restriction Period in Common Stock shall be
added to the Restricted Stock awarded and held by the
Company in escrow subject to the same restrictions.
(iii) Forfeiture of restricted Stock. If during the
Restriction Period a Participant shall cease to be a member
of the Board for any reason other than death or Disability
on or after the date of shareholder approval of the Plan,
the Shares of Restricted Stock granted to the Participant
shall be deemed forfeited to the Company.
(iv) Lapse of Restrictions. The restrictions on Shares
of Restricted Stock provided herein shall lapse upon the
earlier of (1) expiration of the Restriction Period or (2)
the death or Disability of the Participant while a member
of the Board during the Restriction Period and on or after
the date of shareholder approval of the Plan. As promptly
as practicable following the lapse of the restrictions,
certificates for such Shares shall be delivered to the
Participant or his estate or beneficiary.
6.03 Terms of Options. The Options shall be granted to
Participants on the following terms and conditions:
(i) Exercise Price. The exercise price per Share of
an Option shall be 100% of the Fair Market Value of a Share
on the date of grant of such Option.
(ii) Option Term. The term of each Option shall be
five (5) years from the date of grant, provided however,
that the Option shall expire upon the Participant's
termination of service as a director of the Company for any
reason other than Retirement, Disability or death.
(iii) Exercisability. The Option shall become
exercisable upon the expiration of three years from the
date of grant or, if earlier, upon the Participant's
termination of service as a director of the Company by
reason of Retirement, Disability or death.
(iv) Methods of Exercise. The exercise price of any
Option may be paid in cash or Shares, or any combination
thereof, having a Fair Market Value on the date of exercise
equal to the exercise price, provided, however, that (1)
any portion of the exercise price representing a fraction
of a Share shall in any event be paid in cash and (2) no
Shares which have been held for less than six months may be
delivered in payment of the exercise price of an Option.
Delivery of Shares in payment of the exercise price of an
Option may be accomplished through the effective transfer
to the Company of Shares held by a broker or other agent.
The Company will also cooperate with any person exercising
an Option who participates in a cashless exercise program
of a broker or other agent under which all or part of the
Shares received upon exercise of the Option are sold
through the broker or other agent, or under which the
broker or other agent makes a loan to such person, for the
purpose of paying the exercise price of an Option.
Notwithstanding the preceding sentence, the exercise of the
Option shall not be deemed to occur, and no Shares will be
issued by the Company upon exercise of an Option, until the
Company has received payment in full of the exercise price.
6.04 Grant of Awards. Subject to Section 12.01 hereof-.
6.04.1 Initial Restricted Stock Grants. Upon the
effectiveness of a Registration Statement with respect to
such shares under the Securities Act of 1933 and the
furnishing to such Participants of an appropriate
prospectus with respect thereto, each Person who is then a
Participant shall automatically be granted 450 Shares of
Restricted Stock.
6.04.2 Initial Option Grants. On the first day of
June (or if not a day on which the New York Stock Exchange
is open for trading, then on the first such trading day
thereafter) in each year during the term of the Plan, any
Person who is then a Participant and who has not previously
been granted Restricted Stock under Section 6.04.1 or an
Option under this Section 6.04.2 shall automatically be
granted an Option for 2,500 Shares, which shall be in
addition to the Option granted to the Participant on such
date under Section 6.04.3.
6.04.3 Annual Option Grants. On the first day of
June (or if not a day on which the New York Stock Exchange
is open for trading, then on the first such trading day
thereafter) in each year during the term of the Plan, each
Person who is then a Participant shall automatically be
granted an Option for 500 Shares.
6.04.4 Allocation of shore. If on any date on which
Awards would otherwise be granted under this Section 6.04
the number of Shares remaining available under Section 4.01
is not sufficient for each Participant otherwise entitled
to the grant of an Award to be granted an Award for the
full number of Shares provided in this Section 6.04, then
each such Participant shall automatically be granted an
Award for the number of whole Shares (if any) equal to (a)
the number of Shares then remaining available under the
Plan, multiplied by (b) a fraction of which (1) the
numerator is the number of Shares for which such
Participant would otherwise be granted an Award on such
date and (2) the denominator is the number of Shares for
which all Participants would otherwise be granted Awards on
such date, with any fractional shares being disregarded.
6.04.5 Nature of Award Grants; Award Agreements. The
grant of the Awards provided for in this Section 6.04 shall
be automatic and not subject to the discretion of the
Committee or any other Person. However, the Committee may
condition the right of Participant to be granted an Award
upon the execution and delivery by the Participant of an
Award Agreement setting forth the terms and conditions of
the Award as provided herein and such other terms,
conditions and restrictions, not inconsistent with the
provisions of the Plan, as the Committee in its discretion
may determine.
Section 7. General Terms of Awards
7.01 Certain Restrictions Under Rule 16b-3. Upon the
effectiveness of any amendment to Rule 16b-3, this Plan and any
Award Agreement for an outstanding Award held by a Participant
then subject to Section 16 of the Exchange Act shall be deemed
to be amended, without further action on the part of the
Committee, the Board or the Participant, to the extent
necessary for Awards under the Plan or such Award Agreement to
qualify for the exemption provided by Rule 16b-3, as so
amended, except to the extent any such amendment requires
shareholder approval.
7.01.1 Six-Month Limitations on Sales. Except in the
case of death, Shares underlying any Award granted under
the Plan may not be sold for at least six months after the
later of (1) the date of approval of the Plan by the
shareholders of the Company as provided in Section 12.01
and (2) the date of grant of the Award; provided, that
these limitations shall not apply to the extent such
limitations are not at the time required for the grant of
the Award to continue to qualify for the exemption provided
by Rule 16b-3. Certificates issued for Shares subject to
limitations under this Section 7.01.1 may be made subject
to stop-transfer orders and/or legended as provided in
Section 7.04.
7.01.2 Nontransferability. Options shall not be
transferable by a Participant except by will or the laws of
descent and distribution and shall be exercisable during a
Participant's lifetime only by such Participant or his
guardian or legal representative; provided, that these
restrictions on transferability shall not apply to the
extent such restrictions are not at the time required for
the Plan to continue to meet the requirements of Rule 16b-
3. Notwithstanding the preceding sentence and
notwithstanding the restrictions on transfer of Restricted
Stock, if so determined by the Committee, a Participant
may, in the manner established by the Committee, designate
a beneficiary or beneficiaries to exercise the rights of
the Participant, and to receive any distribution with
respect to any Award, upon the death of the Participant.
7.02 Limits on Transfer of Awards,- Beneficiaries. No
right or interest of a Participant in any Option or Restricted
Stock shall be pledged, encumbered or hypothecated to or in
favor of any Person other than the Company, or shall be subject
to any lien, obligation or liability of such Participant to any
Person other than the Company. A beneficiary, guardian, legal
representative or other Person claiming any rights under the
Plan from or through any Participant shall be subject to all
the terms and conditions of the Plan and any Award Agreement
applicable to such Participant as well as any additional
restrictions or limitations deemed necessary or appropriate by
the Committee.
7.03 Registration and Listing Compliance. No Shares shall
be distributed with respect to any Award in a transaction
subject to the registration requirements of the Securities Act
of 1933, as amended, or any state securities law or subject to
a listing requirement under any listing agreement between the
Company and any National securities exchange, and no Award
shall confer upon any Participant rights to such delivery or
distribution until such laws and contractual obligations of the
Company have been complied with in all material respects.
Neither the grant of any Award nor anything else contained
herein shall obligate the Company to take any action to comply
with any requirements of any such securities laws or
contractual obligations relating to the registration (or
exemption therefrom) or listing of any Shares or other
securities, whether or not necessary in order to permit any
such delivery or distribution.
7.04 Stock Certificates. All certificates for Shares
delivered under the terms of the Plan shall be subject to such
stop-transfer orders and other restrictions as the Committee
may deem advisable under federal or state securities laws,
rules and regulations thereunder, and the rules of any National
securities exchange or automated quotation system on which
Shares are listed or quoted. The Committee may cause a legend
or legends to be placed on any such certificates to make
appropriate reference to such restrictions or any other
restrictions or limitations that may be applicable to Shares.
Section 8. Adjustment Provisions
8.01 In the event that the Committee shall determine that
any dividend or other distribution (whether in the form of
cash, Shares, other securities or other property),
recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, exchange of Shares or other securities
of the Company, or other similar corporate transaction or event
affects the Shares such that an adjustment is determined by the
Committee to be appropriate in order to prevent dilution or
enlargement of Participants' rights under the Plan, then the
Committee shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and kind of Shares which
may thereafter be issued in connection with Awards; (ii) the
number and kind of Shares issued or issuable in respect of
outstanding Options; and (iii) the exercise price of
outstanding Options.
Section 9. Change of Control Provisions
9.01 Acceleration of Exercisability and Lapse of
Restrictions; Automatic Cash-Out of Awards. In the event of a
Change of Control, the following acceleration and cash-out
provisions shall apply:
(i) All outstanding Options shall become fully
exercisable, and all restrictions (other than those
contained in Section 7.01.1) on outstanding Restricted
Stock shall immediately lapse.
(ii) All outstanding Awards not subject to limitations
under Section 7.01.1 shall be automatically surrendered,
and the Participants shall receive, in full satisfaction
therefor, cash payments equal to the Change of Control
Price of the Shares subject to the Award, reduced in the
case of Options by the exercise price thereof In no event
will an Award be automatically surrendered or a Participant
have the right to receive cash under this Section 9.01 (ii)
with respect to an Award (a) if at least six months shall
not have elapsed from the date on which the Participant was
granted the Award (or, if later, from the date of
shareholder approval of the Plan)before the date of the
Change of Control (unless this restriction is not at such
time required under Rule 16b-3(c)(1) or Rule 16b-3(e)) or
(b) if the Participant is subject to Section 16 of the
Exchange Act and had the power to control the occurrence or
timing of the Change of Control such that the surrender and
right to receive cash under this Section 9.01 (ii) would
fail to be exempt pursuant to Rule 16b-3(e).
(iii) In the event that any Award is subject to
limitations under Section 7.01.1 at the time of a Change of
Control, then, solely for the purpose of determining the
rights of the Participant with respect to such Award, a
Change of Control shall be deemed to occur at the close of
business on the first business day following the date on
which the limitations on such Award under Section 7.01.1
have expired; provided, however, that this Section 9.01
(iii) shall not apply if its application would cause the
surrender of the Award and the receipt of cash under
Section 9.01 (ii) to fail to be exempt pursuant to Rule
16b3 (e).
(iv) In the discretion of the Committee, the Committee
may permit any Participant not subject to Section 16 of the
Exchange Act on the date of a Change of Control to elect,
in such manner and at such time or times or within such
periods as the Committee may determine (whether before or
after a Change of Control), and subject to such other
terms, conditions or restrictions, if any, as the Committee
may determine to impose, not to surrender for cash pursuant
to Section 9.01 (ii) all or any portion of any Award held
by the Participant; provided, however, that such election
may not be made available if to do so would cause the grant
of the Award to fail to qualify for the exemption provided
by Rule 16b3 (c) (2) (ii).
9.02 Creation and Funding of Trust. Upon the occurrence
of a Potential Change of Control, the Company shall deposit
with the trustee of a trust for the benefit of Participants
monies or other property having a Fair Market Value at least
equal to the Fair Market Value of the Shares subject to the
Awards outstanding at that date, reduced in the case of Options
by the aggregate exercise price thereof The trust shall be a
grantor trust which shall preserve the "unfunded" status of
Awards under the Plan. Subsequent to a Potential Change of
Control which is no longer continuing and prior to a Change of
Control and termination of the trust, upon the request of the
Company, the trustee shall deliver the monies or other property
held in the trust to the Company. In the discretion of the
Committee, moneys or other property may also be deposited in
the trust created under this Section 9.02 for the benefit of
participants in any other compensation or benefit plan,
program, contract or arrangement of the Company or any
Subsidiary.
9.03 Definition of Certain Terms. For purposes of this
Section 9, the following definitions, in addition to those set
forth in Section 2.01, shall apply:
9.03.1 "Change of Control" means and shall be deemed
to have occurred if (i) any Person, other than the Company
or a Related Party, purchases or otherwise acquires, under
a tender offer or otherwise, Beneficial Ownership of any
Voting Securities which, when combined with other Voting
Securities then Beneficially Owned by such Person,
represent twenty percent (20%) or more of the total voting
power of all the then outstanding Voting Securities; or
(ii) the individuals (a) who as of the effective date of
the Plan constitute the Board or (b) who thereafter are
elected to the Board and whose election, or nomination for
election, to the Board was approved by a vote of at least
two-thirds of the directors then still in office who either
were directors as of the effective date of the Plan or
whose election or nomination for election was previously so
approved (the "Continuing Directors"), cease for any reason
to constitute a majority of the members of the Board; or
(iii) the Company is a party to a merger, consolidation,
share exchange, recapitalization or reorganization of the
Company or an acquisition of securities or assets by the
Company, other than any such transaction (a) which would
result in the Voting Securities outstanding immediately
prior thereto continuing to represent either by remaining
outstanding or by being converted into Voting Securities of
the surviving or acquiring entity, at least fifty percent
(50%) of the total voting power represented by the Voting
Securities of such surviving or acquiring entity
outstanding immediately after such transaction and (b) in
or as a result of which the voting rights of each Voting
Security relative to the voting rights of all other Voting
Securities are not altered other than through the exercise
of dissenters' rights; or (iv) the shareholders of the
Company approve a plan of complete liquidation of the
Company; or (v) the Company shall sell or otherwise dispose
of, other than to a Related Party, in a single or a series
of related transactions otherwise than in the ordinary
course of business, assets of the Company and/or stock or
assets of any Subsidiary, having a book value equal to 50%
or more of the consolidated total assets of the Company, in
each case measured as the date of the most recent quarterly
or annual balance sheet of the Company required to be
included or incorporated by reference in any proxy or
information statement of the Company famished to the
shareholders of the Company in connection with such
transaction, or if no such proxy or information statement
is famished to shareholders or no such balance sheet is
required to be included or incorporated by reference
therein, as of the date of the most recent quarterly or
annual balance sheet of the Company required to be filed
with the Securities and Exchange Commission prior to the
date of any such transaction;
9.03.2 "Change of Control Price" means, with respect
to a Share, the higher of (i) the highest reported sales
price of Shares on the New York Stock Exchange's
consolidated transaction reporting system (or if the Common
Stock is not then listed on such Exchange, on or on any
composite index including the principal United States
securities exchange on which the Common Stock is then
listed, or if none, on NASDAQ or any similar system then in
use, and in the absence of any such reported sales prices,
the highest publicly reported bid price for Shares) during
the 30 calendar days preceding the date of a Change of
Control or (ii) the highest price paid or offered in a
transaction which either (a) results in a Change of Control
or (b) would be consummated but for another transaction
which results in a Change of Control and, if it were
consummated, would result in a Change of Control. With
respect to clause (ii) in the preceding sentence, the
"price paid or offered" will be equal to the sum of (a) the
face amount of any portion of the consideration consisting
of cash or cash equivalents and (b) the fair market value
of any portion of the consideration consisting of real or
personal property other than cash or cash equivalents, as
established by an independent appraiser selected by the
Committee.
9.03.3 "Potential Change of Control" means and shall
be deemed to have arisen if (i) the Company enters into an
agreement, the consummation of which would result in the
occurrence of the Change of Control; or (ii) any Person
(including the Company) publicly announces an intention to
take or to consider taking actions which if consummated
would constitute a Change of Control; or (iii) any Person,
other than a Related Party, files with the Securities and
Exchange Commission a Schedule 13D pursuant to Rule 13d-I
under the Exchange Act with respect to Voting Securities;
or (iv) any Person, other than the Company or a Related
Party, files with the Federal Trade Commission a
notification and report form pursuant to the Hart-Scott-
Rodino Antitrust Improvements Act of 1976 with respect to
any Voting Securities or any assets of the Company or a
Subsidiary; or (v) the Board or a committee thereof adopts
a resolution to the effect that, for purposes of the Plan,
a Potential Change of Control has arisen. A Potential
Change of Control will be deemed to continue (a) with
respect to an agreement within the purview of clause (i) of
the preceding sentence, until the agreement is canceled or
terminated; or (b) with respect to an announcement within
the purview of clause (ii) of the preceding sentence, until
the Person making the announcement publicly abandons the
stated intention or fails to act on such intention for a
period of 12 calendar months; or (c) with respect to the
filing of a Schedule 13D within the purview of clause (iii)
of the preceding sentence, until the Person involved
publicly announces that its ownership or acquisition of the
Voting Securities is for investment purposes only and not
for the purpose of seeking a Change of Control or such
Person disposes of all Voting Securities exceeding 5% of
the outstanding shares of any class; or (d) with respect to
the filing of a notification and report form within the
purview of clause (iv) of the preceding sentence with
respect to Voting Securities or assets, until the person
publicly abandons the transaction which was the subject of
such filing or fails to act thereon for a period of 12
calendar months or, in the case of a filing with respect to
Voting Securities, until the Person involved (1) publicly
announces that its ownership or acquisition of the Voting
Securities is for investment purposes only and not for the
purpose of seeking a Change of Control or (2) following
completion of such transaction disposes of all Voting
Securities exceeding 5% of the outstanding shares of any
class; or (e)until a Change of Control has occurred if the
majority of the Continuing Directors, on reasonable belief
after due investigation, adopts a resolution that either
(1) the Potential Change of Control has ceased to exist or
(2) the Potential Change of Control is believed to be not
reasonably likely to result in a Change of Control.
9.03.4 "Related Party" means (i) a Subsidiary; or
(ii) a trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any Subsidiary;
or (iii) a Company owned directly or indirectly by the
shareholders of the Company in substantially the same
proportion as their ownership of Voting Securities.
9.03.5 "Voting Securities or Security" means any
securities of the Company which carry the right to vote
generally in the election of directors.
9.03.6 "Beneficial Ownership" shall be determined in
accordance with Regulation 13D-G under the Exchange Act, as
in effect on the effective date of the Plan.
Section 10. Amendments to and Termination of the Plan
10.01 The Board may amend, alter, suspend, discontinue or
terminate the Plan without the consent of shareholders or
Participants, except that, without the approval of the
shareholders of the Company, no amendment, alteration,
suspension, discontinuation or termination shall be made if
shareholder approval is required by any federal or state law or
regulation, or if the Board determines that obtaining such
shareholder approval is for any reason advisable; provided,
however, that (1) except as provided in Section 7.01, without
the consent of the Participant, no amendment, alteration,
suspension, discontinuation or termination of the Plan may
materially and adversely affect the rights of such Participant
under any Award theretofore granted to him and (2) no provision
of the Plan referred to in Rule 16b-3 (c) (2) (ii) (A) may be
amended more than once every six months other than to comport
with changes in the Code or the rules thereunder.
Section 11. General Provisions
11.01 No Shareholder Rights. No Option shall confer on any
Participant any of the rights of a shareholder of the Company
unless and until Shares are in fact issued to such Participant
in connection with such Option.
11.02 No Right to Directorship. Nothing contained in the
Plan or any Award Agreement shall confer, and no grant of an
Award shall be construed as conferring, upon any Participant
any right to continue as a director of the Company or interfere
in any way with the rights of the shareholders of the Company
or the Board to elect and remove directors.
11.03 Unfunded Status of Awards,-Creation of Trusts. The
Plan is intended to constitute an unfunded" plan for incentive
compensation. With respect to any Shares not yet issued to a
Participant pursuant to an Award, nothing contained in the Plan
or any Award Agreement shall give any such Participant any
rights that are greater than those of a general unsecured
creditor of the Company; provided, however, that, in addition
to the requirements of Section 9.02, the Committee may
authorize the creation of trusts or make other arrangements to
meet the Company's obligations under the Plan to deliver Shares
pursuant to any Award, which trusts or other arrangements shall
be consistent with the "unfunded" status of the Plan unless the
Committee otherwise determines.
11.04 No Limit on Other Compensatory Arrangements. Nothing
contained in the Plan shall prevent the Company from adopting
other or additional compensation arrangements, and such
arrangements may be either generally applicable or applicable
only in specific cases. To the extent consistent with the
Plan, the terms of each Award shall be construed so as to be
consistent with such other arrangements in effect at the time
the Award is granted.
11.05 No Fractional Shares. No fractional Shares shall be
issued or delivered pursuant to the Plan or any Award.
11.06 Governing Law. The validity, interpretation,
construction and effect of the Plan and any rules and
regulations relating to the Plan shall be governed by the laws
of the Commonwealth of Pennsylvania (without regard to the
conflicts of laws thereof), and applicable federal law.
11.07 Severability. If any provision of the Plan or any
Award Agreement is or becomes or is deemed invalid, illegal or
unenforceable in any jurisdiction, or would disqualify the Plan
or any Award under any law deemed applicable by the Committee,
such provision shall be construed or deemed amended to conform
to applicable laws or if it cannot be construed or deemed
amended without, in the determination of the Committee,
materially altering the intent of the Plan, it shall be deleted
and the remainder of the Plan shall remain in full force and
effect; provided, however, that, unless otherwise determined by
the Committee, the provision shall not be construed or deemed
amended or deleted with respect to any Participant whose rights
and obligations under the Plan are not subject to the law of
such jurisdiction or the law deemed applicable by the
Committee.
Section 12. Effective Date and Term of the Plan
12.01 The effective date and date of adoption of the Plan
shall be January 21, 1994, the date of adoption of the Plan by
the Board, provided that such adoption of the Plan is approved
by the affirmative vote of a majority of the shares of Common
Stock present in person or represented by proxy and entitled to
vote at a duly held meeting of shareholders of the Company held
on or prior to December 31, 1994. Notwithstanding anything
else contained in the Plan or in any Award Agreement, no Option
granted under the Plan may be exercised, and no certificates
for Shares of Restricted Stock may be delivered, prior to such
shareholder approval or prior to any required approval or
consent from those governmental agencies having jurisdiction in
these matters. In the event such shareholder or regulatory
approval is not obtained, all Options granted under the Plan
shall automatically be deemed void and of no effect, and all
Shares of Restricted Stock granted under the Plan shall be
deemed forfeited to the Company. No Award may be granted under
the Plan subsequent to June 2, 1998.