Exhibit 10.14
EQUITABLE RESOURCES, INC.
LONG-TERM INCENTIVE PLAN
EXHIBIT B
Section 1. Purposes
1.01 The purpose of the 1994 Equitable Resources, Inc.
Long-Term Incentive Plan (the "Plan") is to enable Equitable
Resources, Inc. (together with any successor thereto, the
"Company") to focus key executives' efforts on performance
which will increase the value of the Company for its
shareholders. The Plan is intended to align the interests of
key executives with those of the shareholders by encouraging
share ownership. The Plan is also intended to help to attract
and retain key executives.
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, Stock Appreciation
Right, Restricted Stock, Deferred Stock, Performance
Award, Dividend Equivalent, or Other Stock-Based Award, or
any other right or interest relating to Shares or cash
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; provided however, that the Committee
shall qualify to administer the Plan as contemplated by
Rule 16b3 (c) (2) (i) of the Exchange Act or any successor
and by Section 162 (m) (4) (C) of the Code or any
successor.
2.01.6 "Common Stock" means 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 "Covered Employee" shall have the meaning
provided in Section 162(m) (3) of the Code.
2.01.8 "Deferred Stock" means Shares, granted under
Section 6.05 hereof, receipt of which is deferred for a
specified deferral period.
2.01.9 "Dividend Equivalent" means a right, granted
under Section 6.07 hereof, to receive interest or
dividends, or interest or dividend equivalents.
2.01.10 "Exchange Act" means the Securities Exchange
Act of 1934, as amended.
2.01.11 "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 2.01.10. 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 2.01.10, 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.
2.01.12 "Incentive Stock Option" means an Option that
is intended to meet the requirements of Section 422 of the
Code or any successor provision thereto and is designated
as such in the Award Agreement relating thereto.
2.01.13 "Option" means a right, granted under Section
6.02 hereof, to purchase Shares at a specified price
during specified time periods. An Option may be either an
Incentive Stock Option or a nonstatutory stock option,
which is an Option not intended to be an Incentive Stock
Option.
2.01.14 "Other Stock-Based Award" means an Award,
granted under Section 6.08 hereof, that is denominated or
payable in, valued in whole or in part by reference to, or
otherwise based on, or related to, Shares.
2.01.15 "Participant" means a key employee of the
Company or any Subsidiary, including, but not limited to,
Covered Employees, who is granted an Award under the Plan.
2.01.16 "Performance Award" means a right, granted
under Section 6.06 hereof, to receive Awards based upon
performance criteria specified by the Committee.
2.01.17 "Person" shall have the meaning assigned in the
Exchange Act.
2.01.18 "Restricted Stock" means Shares, granted under
Section 6.04 hereof, that are subject to certain
restrictions.
2.01.19 "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.
2.01.20 "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
2.01.21 "Stock Appreciation Right" means a right,
granted under Section 6.03 hereof, to be paid an amount
measured by the appreciation in the Fair Market Value of
Shares from the date of grant to the date of exercise.
2.01.22 "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.
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 designate Participants;
(ii) to determine the type or types of Awards to be
granted to each Participant;
(iii) to determine the number of Awards to be
granted, the number of Shares or amount of cash or other
property to which an Award will relate, the terms and
conditions of any Award (including, but not limited to,
any exercise price, grant price or purchase price, any
limitation or restriction, any schedule for lapse of
limitations, forfeiture restrictions or restrictions on
exercisability or transferability, and accelerations or
waivers thereof, based in each case on such considerations
as the Committee shall determine), and all other matters
to be determined in connection with an Award;
(iv) to determine whether, to what extent and under
what circumstances an Award may be settled in, or the
exercise price of an Award may be paid in cash, Shares,
other Awards or other property, or an Award may be
accelerated, vested, canceled, forfeited, exchanged or
surrendered;
(v) to determine whether, to what extent and under
what circumstances cash, Shares, other Awards, other
property and other amounts payable with respect to an
Award shall be deferred, whether automatically or at the
election of the Committee or at the election of the
Participant;
(vi) to interpret and administer the Plan and any
instrument or agreement relating to, or Award made under,
the Plan;
(vii) to prescribe the form of each Award Agreement,
which need not be identical for each Participant;
(viii) to adopt, amend, suspend, waive and rescind
such rules and regulations as the Committee may deem
necessary or advisable to administer the Plan;
(ix) 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 made under the
Plan;
(x) 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;
(xi) to submit for shareholder approval or not as
may be appropriate and to take such other actions and make
such other decisions as may be required by the Revenue
Reconciliation Act of 1993 with respect to the definition
of performance-based compensation as it may from time to
time be defined; and
(xii) to make such filings and take such actions as
may be required from time to time by appropriate state,
regulatory and governmental agencies.
Any action of the Committee with respect to the
Plan shall be final, conclusive and binding on all
Persons, including the Company, Subsidiaries,
Participants, any Person claiming any rights under the
Plan from or through any Participant, employees 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 or any Subsidiary the authority,
subject to such terms as the Committee shall determine, to
perform administrative functions under the Plan and, with
respect to Participants who are not subject to Section 16 of
the Exchange Act, to take such actions and perform such
functions under the Plan as the Committee may specify. Each
member of the Committee shall be entitled to, in good faith,
rely or act upon any report or other information furnished to
him by an officer, manager or other employee of the Company or
a Subsidiary, 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.
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 in any
calendar year, subject to adjustment as provided in Section
8.01 of the Plan, shall be (a) in 1994 the sum of (1) one
percent (I%) of the total number of issued and outstanding
shares of Common Stock as of December 31, 1993 and (2) the
number of shares of Common Stock which are reserved but not
subject to grants under the Company's Key Employee Restricted
Stock Option and Stock Appreciation Rights Incentive
Compensation Plan as of the date this Plan is approved by the
shareholders of the Company and (b) in each succeeding
calendar year the sum of (1) one percent (I%) of the total
number of issued and outstanding shares of Common Stock as of
the close of the preceding calendar year, (2) the number of
shares of Common Stock which were available for Awards under
this Section 4.01 as of the close of the preceding calendar
year and (3) any shares of Common Stock which are subject to
an outstanding Award at the beginning of such year but which
thereafter again become available for Awards under the Plan as
provided in the fourth paragraph of this Section 4.01;
provided, however, that in no event may:
(i) the sum of (x) the number of Shares subject to
all outstanding Awards under the Plan and (y) the number
of Shares previously issued under the Plan at any time
equal or exceed 5% of the total number of shares of Common
Stock outstanding on the date of shareholder approval of
the Plan; or
(ii) the sum of (x) the number of Shares subject to
all outstanding Options and Stock Appreciation Rights
granted under the Plan and held by any single Participant
and (y) the number of shares previously issued to such
Participant upon exercise of Options and Stock
Appreciation Rights granted under the Plan at any time
exceed 25% of the sum of (A) the total number of Shares
subject to all outstanding Awards under the Plan, (B) the
total number of Shares previously issued under the Plan
and (C) the total number of Shares then available for the
grant of additional Awards under the Plan. Subject to
subparagraphs (i) and (ii) above, but notwithstanding
anything else contained above in this Section 4.01, in the
event of a Change of Control, the maximum number of shares
of Common Stock available for Awards under the Plan shall
be 5% of the total number of shares of Common Stock issued
and outstanding on the date of shareholder approval of the
Plan, less (1) the number of Shares subject to outstanding
Awards under the Plan and (2) the number of Shares
previously issued under the Plan.
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, unless such number of Shares cannot be
determined at that time, in which case the number of Shares
actually distributed pursuant to the Award shall be counted
against the number of Shares reserved and available under the
Plan at the time of distribution; provided, however, that
Awards related to or retroactively added to, or granted in
tandem with, substituted for or converted into, other Awards
shall be counted or not counted against the number of Shares
reserved and available under the Plan in accordance with
procedures adopted by the Committee so as to ensure
appropriate counting but avoid double counting.
If any Shares to which an Award relates are forfeited, or
payment is made to the Participant in the form of cash, cash
equivalents or other property other than Shares, or the Award
otherwise terminates without payment being made to the
Participant in the form of Shares, 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, alternative payment or termination, again be
available for Awards under the Plan provided, however,
forfeited Shares 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 Award 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 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 may be granted only to individuals who are
key full-time employees (including, without limitation,
employees who also are directors or officers and Covered
Employees) of the Company or any Subsidiary; provided,
however, that no Award shall be granted to any member of the
Committee.
Section 6. Specific Terms of Awards
6.01 GeneraL Subject to the terms of the Plan and any
applicable Award Agreement, Awards may be granted as set forth
in this Section 6. In addition, the Committee may impose on
any Award or the exercise thereof, at the date of grant or
thereafter (subject to the terms of Section 10.01), such
additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Committee shall determine,
including separate escrow provisions and terms requiring
forfeiture of Awards in the event of termination of employment
by the Participant. Except as provided in Section 7.01, or as
required by applicable law, Awards may be granted for no
consideration other than prior and/or future services.
6.02 Options. The Committee is authorized to grant
Options 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, except as
otherwise provided in Section 7.01, and except that in the
case of an Incentive Stock Option granted to an employee
who, immediately prior to such grant, owns stock
possessing more than 10% of the total combined voting
power of all classes of stock of the Company or any
Subsidiary (a "Ten Percent Employee") such exercise price
shall be I 10% of the Fair Market Value of a Share on the
date of grant. For purposes of the preceding sentence, an
individual (A) shall be considered as owning not only
shares of stock owned individually but also all shares of
stock that are at the time owned, directly or indirectly,
by or for the spouse, ancestors, lineal descendants and
brothers and sisters (whether by the whole or half blood)
of such individual and (B) shall be considered as owning
proportionately any shares owned, directly or indirectly,
by or for arty corporation, partnership, estate or trust
in which such individual is a shareholder, partner or
beneficiary.
(ii) Option Term. The term of each Option shall be
determined by the Committee, except that no Incentive
Stock Option shall be exercisable after the expiration of
ten years from the date of grant, and no Incentive Stock
Option granted to a Ten Percent Employee shall be
exercisable after the expiration of five years from the
date of grant.
(iii) Times and Methods of Exercise. The Committee
shall determine the time or times at which an Option may
be exercised in whole or in part, the methods by which
such exercise price may be paid or deemed to be paid, and
the form of such payment, including, without limitation,
cash, Shares, other outstanding Awards or other property
(including notes or other contractual obligations of
Participants to make payment on a deferred basis, to the
extent permitted by law) or any combination thereof,
having a Fair Market Value on the date of exercise equal
to the exercise price, provided, however, that (1) in the
case of a Participant who is at the time of exercise
subject to Section 16 of the Exchange Act, any portion of
the exercise price representing a fraction of a Share
shall in any event be paid in cash or in property other
than any equity security (as defined by the Exchange Act)
of the Company and (2) except as otherwise determined by
the Committee, in its discretion, at the time the Option
is granted, 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, if authorized by the Committee, may be accomplished
through the effective transfer to the Company of Shares held
by a broker or other agent. Unless otherwise determined by
the Committee, 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, unless the Committee, in its discretion,
shall otherwise determine, 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.
Notwithstanding any other provision contained in the Plan
or in any Award Agreement, but subject to the possible
exercise of the Committee's discretion contemplated in the
last sentence of this Section 6.02 (iii), the aggregate Fair
Market Value, determined as of the date of grant, of the
Shares with respect to which Incentive Stock Options are
exercisable for the first time by a Participant during any
calendar year under all plans of the corporation employing
such employee, any parent or subsidiary corporation of such
corporation and any predecessor corporation of any such
corporation shall not exceed $100,000. If the date on which
one or more of such Incentive Stock Options could first be
exercised would be accelerated pursuant to any provision of
the Plan or any Award Agreement, and the acceleration of such
exercise date would result in a violation of the restriction
set forth in the preceding sentence, then, notwithstanding any
such provision, but subject to the provisions of the next
succeeding sentence, the exercise dates of such Incentive
Stock Options shall be accelerated only to the date or dates,
if any, that do not result in a violation of such restriction
and, in such event, the exercise dates of the Incentive Stock
Options with the lowest option prices shall be accelerated to
the earliest such dales. The Committee may, in its
discretion, authorize the acceleration of the exercise date of
one or more Incentive Stock Options even if such acceleration
would violate the $ 1 00,000 restriction set forth in the
first sentence of this paragraph and even if such Incentive
Stock Options are thereby converted in whole or in part to
nonstatutory stock options.
6.03 Stock Appreciation Rights. The Committee is
authorized to grant Stock Appreciation Rights to Participants
on the following terms and conditions:
(i) Right to Payment. A Stock Appreciation Right
shall confer on the Participant to whom it is granted a
right to receive, upon exercise thereof, the excess of (A)
the Fair Market Value of a Share on the date of exercise
or, if the Committee shall so determine in the case of any
such right other than one related to any Incentive Stock
Option, at any time during a specified period before or
after the date of exercise, over (B) the grant price of
the Stock Appreciation Right as determined by the
Committee as of the date of grant of the Stock
Appreciation Right, which, except as provided in Section
7.01, shall be equal to the Fair Market Value of a Share
on the date of grant.
(ii) Other Terms. The term, methods of exercise,
methods of settlement and any other terms and conditions
of any Stock Appreciation Right shall be determined by the
Committee.
6.04 Restricted Stock. The Committee is authorized to
grant Restricted Stock to Participants on the following terms
and conditions:
(i) Issuance and Restrictions. Restricted Stock
shall be subject to such restrictions on transferability
and other restrictions as the Committee may impose
(including, without limitation, limitations on the right
to vote Restricted Stock or the right to receive dividends
thereon), which restrictions may lapse separately or in
combination at such times, under such circumstances, in
such installments or otherwise, as the Committee shall
determine at the time of grant or thereafter.
(ii) Forfeiture. Except as otherwise determined by
the Committee at the time of grant or thereafter, upon
termination of employment (as determined under criteria
established by the Committee) during the applicable
restriction period, Restricted Stock that is at that time
subject to restrictions shall be forfeited and reacquired
by the Company; provided, however, that the Committee may
provide, by rule or regulation or in any Award Agreement,
that restrictions on Restricted Stock shall be waived in
whole or in part in the event of terminations resulting
from specified causes, and the Committee may in other
cases waive in whole or in part restrictions on Restricted
Stock.
(iii) Certificates for Shares. Restricted Stock
granted under the Plan may be evidenced in such manner as
the Committee shall determine, including, without
limitation, issuance of certificates representing Shares.
Certificates representing Shares of Restricted Stock shall
be registered in the name of the Participant and shall
bear an appropriate legend referring to the terms,
conditions and restrictions applicable to such Restricted
Stock.
6.05 Deferred Stock. The Committee is authorized to
grant Deferred Stock to Participants on the following terms
and conditions:
(i) Issuance and Limitations. Delivery of Shares
shall occur upon expiration of the deferral period
specified for the Award of Deferred Stock by the
Committee. In addition, an Award of Deferred Stock shall
be subject to such limitations as the Committee may
impose, which limitations may lapse at the expiration of
the deferral period or at other specified times,
separately or in combination, in installments or otherwise
as the Committee shall determine at the time of grant or
thereafter. A Participant awarded Deferred Stock shall
have no voting rights and shall have no rights to receive
dividends in respect of Deferred Stock, unless and only to
the extent that the Committee shall award Dividend
Equivalents in respect of such Deferred Stock.
(ii) Forfeiture. Except as otherwise determined by
the Committee upon termination of employment (as
determined under criteria established by the Committee)
during the applicable deferral period, Deferred Stock that
is at that time subject to deferral (other than a deferral
at the election of the Participant) shall be forfeited;
provided, however, that the Committee may provide, by rule
or regulation or in any Award Agreement, that forfeiture
of Deferred Stock shall be waived in whole or in part in
the event of terminations resulting from specified causes,
and the Committee may in other cases waive in whole or in
part the forfeiture of Deferred Stock.
6.06 Performance Awards. The Committee is authorized to
grant Performance Awards to Participants on the following
terms and conditions:
(i) Right to Payment. A Performance Award shall
confer upon the Participant rights, valued as determined
by the Committee, and payable to, or exercisable by, the
Participant to whom the Performance Award is granted, in
whole or in part, as the Committee shall establish. The
performance criteria and all other terms and conditions of
the Performance Award shall be determined by the Committee
upon the grant of each Performance Award or thereafter.
(ii) Other Terms. A Performance Award may be
denominated or payable in cash, deferred cash, Shares,
other Awards or other property, and other terms and
conditions of Performance Awards shall be as determined by
the Committee.
6.07 Dividend Equivalents. The Committee is authorized
to grant Dividend Equivalents to Participants. Dividend
Equivalents shall confer upon the Participant rights to
receive, currently or on a deferred basis, interest or
dividends, or interest or dividend equivalents, with respect
to a number of Shares, or otherwise, as determined by the
Committee. The Committee may provide that Dividend
Equivalents shall be paid or distributed when accrued or shall
be deemed to have been reinvested in additional Shares or
additional Awards or otherwise reinvested.
6.08 Other Stock-Based Awards. The Committee is
authorized, subject to limitations under applicable law, to
grant to Participants such other Awards that are denominated
or payable in, valued in whole or in part by reference to, or
otherwise based on, or related to, Shares, as deemed by the
Committee to be consistent with the purposes of the Plan and,
with respect to Participants who are subject to Section 16 of
the Exchange Act, to comply with Rule 16b-3 and applicable law
including, without limitation, purchase rights, Shares awarded
which are not subject to any restrictions or conditions,
convertible securities, exchangeable securities or other
rights convertible or exchangeable into Shares, as the
Committee in its discretion may determine. In the discretion
of the Committee, such Other Stock-Based Awards, including
Shares, or other types of Awards authorized under the Plan,
may be used in connection with, or to satisfy obligations of
the Company or a Subsidiary under, other compensation or
incentive plans, programs or arrangements of the Company or
any Subsidiary for eligible Participants, including without
limitation 'the Short-Term Incentive Compensation Plan, the
Supplemental Executive Retirement Plan (SERP) and executive
contracts.
The Committee shall determine the terms and conditions of
Other Stock-Based Awards. Except as provided in Section 7.01,
Shares or securities delivered pursuant to a purchase right
granted under this Section 6.08 shall be purchased for such
consideration, paid for by such methods and in such forms,
including, without limitation, cash, Shares, outstanding
Awards or other property or any hereof, as the Committee shall
determine, but the value of such consideration shall not be
less than the Fair Market Value of such Shares or other
securities on the date of grant of such purchase right.
Delivery of Shares or other securities in payment of a
purchase right, if authorized by the Committee, may be
accomplished through the effective transfer to the Company of
Shares or other securities held by a broker or other agent.
Unless otherwise determined by the Committee, the Company will
also cooperate with any person exercising a purchase right who
participates in a cashless exercise program of a broker or
other agent under which all or part of the Shares or
securities received upon exercise of a purchase right 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 a purchase right.
Notwithstanding the preceding sentence, unless the Committee,
in its discretion, shall otherwise determine, the exercise of
the purchase right shall not be deemed to occur, and no Shares
or other securities will be issued by the Company upon
exercise of a purchase right, until the Company has received
payment in full of the exercise price.
6.09 Exchange Provisions. The Committee may at any time
offer to exchange or buy out any previously granted Award for
a payment in cash, Shares, another Award or other property,
based on such terms and conditions as the Committee shall
determine and communicate to the Participant at the time that
such offer is made.
Section 7. General Terms of Awards
7.01 Stand-Alone, Tandem and Substitute Awards. Awards
granted under the Plan may, in the discretion of the
Committee, be granted either alone or in addition to, in
tandem with or in substitution for, any other Award granted
under the Plan or any award granted under the Management
Incentive Compensation Plan, or any other plan, program or
arrangement of the Company or any Subsidiary (subject to the
terms of Section 10.01) or any business entity acquired or to
be acquired by the Company or a Subsidiary. If an Award is
granted in substitution for another Award or award, the
Committee shall require the surrender of such other Award or
award in consideration for the grant of the new Award. Awards
granted in addition to or in tandem with other Awards or
awards may be granted either at the same time as or at a
different time from the grant of such other Awards or awards,
except that Awards may be granted in tandem with an Incentive
Stock Option only at the time the Incentive Stock Option is
granted. The exercise price of any Option, the grant price of
any Stock Appreciation Right or the purchase price of any
other Award conferring a right to purchase Shares:
(i) granted in substitution for an outstanding
Award or award shall be not less than the Fair Market
Value of Shares at the date such substitute Award is
granted; provided, however, that (1) except in the case of
(a) an Incentive Stock Option or (b) an Option or Stock
Appreciation Right granted to a Covered Employee, the
exercise, grant or purchase price per share of the
substituted Award may be reduced to reflect the Fair
Market Value of the Award or award required to be
surrendered by the Participant as a condition to receipt
of such substitute Award, and (2) in the case of any
Participant, the Committee may, in lieu of such price
reduction, make an additional Award or payment to the
Participant reflecting the Fair Market Value of the Award
or award required to be surrendered; or
(ii) retroactively granted in tandem with an
outstanding Award or award shall be not less than the
lesser of the Fair Market Value of Shares at the date of
grant of the later Award or the Fair Market Value of
Shares at the date of grant of the earlier Award.
7.02 Certain Restrictions Under Rule ]6b-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.
7.02.1 Six-Month Limitations on Sales and Exercises.
Any equity security (as defined by the Exchange Act),
other than a derivative security, granted or awarded
pursuant to the Plan to a Participant who is at the time
of grant or award subject to Section 16 of the Exchange
Act must be held by the Participant for at least six
months after grant (or, if later, after the date of
shareholder approval of the Plan), except in the case of
death. If a derivative security is granted or awarded to
a Participant who is at the time of grant or award subject
to Section 16 of the Exchange Act, (1) the Participant may
not dispose of the derivative security (other than through
exercise or conversion or upon death) or of any equity
security acquired upon its exercise or conversion (other
than upon death) until six months have elapsed from the
date of grant or award of the derivative security (or, if
later, from the date of shareholder approval of the Plan)
and (2) except with respect to an Option, the derivative
security may not be exercised or converted within such
six-month period (other than upon death) unless such
exercise would not cause the grant or award of the
derivative security to cease to be exempt under Rule 16b-
3. The limitations in this Section 7.02.1 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 7.02.1 may be made subject to stop-transfer
orders, legended and/or made subject to a custodial
arrangement as provided in Section 7.07.
7.02.2 Nontransferability. Awards which constitute
derivative securities 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; provided,
however, that, 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 (other than an
Incentive Stock Option), upon the death of the
Participant; and provided, further, that the Committee may
determine that these restrictions on transferability shall
not apply to Awards (other than an Incentive Stock Option)
granted to any Participant who, at the time of the initial
grant and the transfer, is not subject to Section 16 of
the Exchange Act or shall not apply to Awards (other than
an Incentive Stock Option) granted to a Participant
subject to Section 16 to the extent such restrictions are
not at the time required for the Plan to continue to meet
the requirements of Rule 16b-3.
7.02.3 Decisions Required to be Made by the
Committee. Other provisions of the Plan and any Award
Agreement notwithstanding, if any decision regarding an
Award or the exercise of any right by a Participant, at
any time such Participant is subject to Section 16 of the
Exchange Act, is required to be made or approved by the
Committee in order that the Plan will continue to meet the
requirements of Rule 16b-3 or in order that a transaction
by such Participant will be exempt under Rule 16b-3, then
the Committee shall retain full and exclusive power and
authority to make such decision or to approve or
disapprove any such decision by the Participant.
7.03 Term of Awards. The term of each Award shall be
for such period as may be determined by the Committee;
provided, however, that in no event shall the term of any
Incentive Stock Option, or a Stock Appreciation Right granted
in tandem therewith, exceed a period of ten years from the
date of its grant.
7.04 Form of Payment of Awards. Subject to the terms of
the Plan and any applicable Award Agreement, payments or
substitutions to be made by the Company upon the grant,
exercise or other payment or distribution of an Award may be
made in such forms as the Committee shall determine at the
time of grant or thereafter (subject to the terms of Section
10.01), including, without limitation, cash, Shares, other
Awards or other property or any combination thereof, and may
be made in a single payment or substitution, in installments
or on a deferred basis, in each case in accordance with rules
and procedures established, or as otherwise determined, by the
Committee. Such rules and procedures or determinations may
include, without limitation, provisions for the payment or
crediting of reasonable interest on installment or deferred
payments or the grant or crediting of Dividend Equivalents in
respect of installment or deferred payments.
7.05 Limits on Transfer of awards; Beneficiaries. No
right or interest of a Participant in any Award 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 or a Subsidiary. Unless
otherwise determined by the Committee (subject to the
requirements of Section 7.02.2), no Award and no rights or
interests therein shall be assignable or transferable by a
Participant otherwise than by will or the laws of descent and
distribution except to the Company or a Subsidiary under the
terms of the Plan; provided, however, that, 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. 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.
7.06 Registration and Listing Compliance. No Award shall
be paid and no Shares or other securities 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 payment or
distribution until such laws and contractual obligations of
the Company have been complied with in all material respects.
Except to the extent required by the terms of an Award
Agreement or another contract between the Company and the
Participant, 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 payment or distribution.
7.07 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.
In addition, during any period in which Awards or Shares are
subject to restrictions or limitations under the terms of the
Plan or any Award Agreement, or during any period during which
delivery or receipt of an Award or Shares has been deferred by
the Committee or a Participant, the Committee may require any
Participant to enter into an agreement providing that
certificates representing Shares issuable or issued pursuant
to an Award shall remain in the physical custody of the
Company or such other Person as the Committee may designate.
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 Awards; and (iii)
the exercise price, grant price or purchase price relating to
any Award or, if deemed appropriate, make provision for a cash
payment with respect to any outstanding Award; provided,
however, in each case, that (1) with respect to Incentive
Stock Options, no such adjustment shall be authorized to the
extent that such authority would cause the Plan to violate
Section 422(b) (1) of the Code or any successor provision
thereto and (2) with respect to Options and Stock Appreciation
Rights held by a Covered Employee, no such adjustment shall be
authorized to the extent that such authority would cause such
Awards to fail to qualify as "performance-based compensation"
under Section 162 (m) (4) (C) of the Code. In addition, the
Committee is authorized to make adjustments in the terms and
conditions of, and the criteria of, Awards in recognition of
unusual or nonrecurring events (including, without limitation,
events described in the preceding sentence) affecting the
Company or the financial statements of the Company, or in
response to changes in applicable laws, regulations or
accounting principles; provided, however, that (1) with
respect to Incentive Stock Options, no such adjustment shall
be authorized to the extent that such authority would cause
the Plan to violate Section 422(b)(1) of the Code or any
successor provision thereto and (2) with respect to Options
and Stock Appreciation Rights held by a Covered Employee, no
such adjustment shall be authorized to the extent that such
authority would cause such Awards to fail to qualify as
"performance-based compensation" under Section 162 (m) (4) (C)
of the Code.
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 unless otherwise provided by the
Committee at the time of the Award grant:
(i) All outstanding Awards pursuant to which the
Participant may have rights, the exercise of which is
restricted or limited, shall become fully exercisable,
except as may be otherwise provided in Section 7.02. 1;
unless the right to lapse of restrictions or limitations
is waived or deferred by a Participant prior to such
lapse, all restrictions or limitations (including risks of
forfeiture and deferrals) on outstanding Awards subject to
restrictions or limitations under the Plan shall lapse,
except as may be otherwise provided in Section 7.02. 1;
and all performance criteria and other conditions to
payment of Awards under which payments of cash, Shares or
other property are subject to conditions shall be deemed
to be achieved or fulfilled and shall be waived by the
Company, except as may be otherwise required to comply
with Rule 16b-3.
(ii) All outstanding Awards not subject to
limitations under Section 7.02.1 shall be automatically
surrendered, and the Participants shall receive, in full
satisfaction therefor, cash payments equal to the value of
such outstanding Awards calculated on the basis of the
Change of Control Price of any Shares or the Fair Market
Value of any property other than Shares relating to such
Award; provided, however, that (a) in the case of a
nonstatutory stock option, or a Stock Appreciation Right
granted in tandem therewith, the cash payment shall be
equal to the Change of Control Price of the Shares subject
to the Option reduced by the exercise price thereof, (b)
in the case of an Incentive Stock Option, or a Stock
Appreciation Right granted in tandem therewith, the cash
payment shall be equal to the Fair Market Value of the
Shares subject to the Option on the date on which the
Change of Control occurred reduced by the exercise price
thereof, (c) in the case of a Stock Appreciation Right not
granted in tandem with another award, the cash payment
shall be equal to the Change of Control Price of the
Shares subject to the Stock Appreciation Right reduced by
the grant price thereof, and (d) in the case of any other
purchase right, the cash payment shall be reduced by the
Fair Market Value of the consideration otherwise required
to exercise such purchase right. In the event that an
Award is granted in tandem with another Award such that
the Participant's right to payment for such Award is an
alternative to payment of another Award, the Participant
shall surrender all alternative Awards and receive payment
for the Award which produces the highest payment to the
Participant. In no event will an Award be automatically
surrendered or a Participant have the right to receive
cash under this Section 9.02 (ii) with respect to an Award
(1) if the Participant is subject to Section 16 of the
Exchange Act (or was subject to Section 16 of the Exchange
Act at the date of grant of the Award) and 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 (2) 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 7.02.1 at the time of a Change
of Control, then, solely for the purpose of determining
the rights of the Participant under Section 9.02(ii) 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 7.02.1 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 16b-3(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 9.02(ii) all or any portion
of any Award or Awards held by the Participant.
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 value of the cash, Shares and other property to
be paid or distributed in connection with Awards outstanding
at that date. 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, monies 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 furnished to the
shareholders of the Company in connection with such
transaction, or if no such proxy or information statement
is furnished 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 in its discretion determines
that obtaining such shareholder approval is for any reason
advisable; provided, however, that except as provided in
Section 7.02, 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. The Committee may waive any conditions or
rights under, amend any terms of, or amend, alter, suspend,
discontinue or terminate, any Award theretofore granted,
prospectively or retrospectively; provided, however, that
except as provided in Section 7.02, without the consent of a
Participant, no amendment, alteration, suspension,
discontinuation or termination of any Award may materially and
adversely affect the rights of such Participant under any
Award theretofore granted to him.
Section 11. General Provisions
11.01 No Right to Awards,- No Shareholder Rights. No
Participant or employee shall have any claim to be granted any
Award under the Plan, and there is no obligation for
uniformity of treatment of Participants and employees, except
as provided in any other compensation arrangement. No Award
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 Award.
11.02 Withholding. To the extent required by applicable
Federal, state, local or foreign law, the Participant or his
successor shall make arrangements satisfactory to the Company,
in its discretion, for the satisfaction of any withholding tax
obligations that arise in connection with an Award. The
Company shall not be required to issue any Shares or make any
cash or other payment under the Plan until such obligations
are satisfied.
The Company is authorized to withhold from any Award
granted or any payment due under the Plan, including from a
distribution of Shares, amounts of withholding taxes due with
respect to an Award, its exercise or any payment thereunder,
and to take such other action as the Committee may deem
necessary or advisable to enable the Company and Participants
to satisfy obligations for the payment of such taxes. This
authority shall include authority to withhold or receive
Shares, Awards or other property and to make cash payments in
respect thereof in satisfaction of such tax obligations.
11.03 No Right to Employment. 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 in the employ of the Company or to
interfere in any way with the right of the Company to
terminate his employment at any time or increase or decrease
his compensation from the rate in existence at the time of
granting of an Award, except as provided in any Award
Agreement or other compensation arrangement.
11.04 Unfunded Status of awards,- Creation of Trusts. The
Plan is intended to constitute an "unfunded" plan for
incentive and deferred compensation. With respect to any
payments not yet made to a Participant pursuant to an Award,
nothing contained in the Plan or any Award 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 cash, Shares or other property pursuant to any
Award, which trusts or other arrangements shall be consistent
with the "unfunded" status of the Plan unless the Committee
otherwise determines.
11.05 No Limit on Other Compensatory Arrangements.
Nothing contained in the Plan shall prevent the Company from
adopting other or additional compensation arrangements (which
may include, without limitation, employment agreements with
executives and arrangements which relate to Awards under the
Plan), and such arrangements may be either generally
applicable or applicable only in specific cases.
Notwithstanding anything in the Plan to the contrary (other
than the provisions of Section 7.02), the terms of each Award
shall be construed so as to be consistent with such other
arrangements in effect at the time of the Award.
11.06 No Fractional Shares. No fractional Shares shall be
issued or delivered pursuant to the Plan or any Award. The
Committee shall determine whether cash, other Awards or other
property shall be issued or paid in lieu of fractional Shares
or whether such fractional Shares or any rights thereto shall
be forfeited or otherwise eliminated.
11.07 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.
11.08 Severability. If any provision of the Plan or any
Award 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 or Award, it shall
be deleted and the remainder of the Plan or Award 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, Stock Appreciation Right or other purchase right
granted under the Plan may be exercised, and no Shares may be
distributed pursuant to any Award granted under the Plan,
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 Awards granted
under the Plan shall automatically be deemed void and of no
effect. No Award may be granted under the Plan subsequent to
May 27, 1999.