EXHIBIT 99.1
1999 EQUITABLE RESOURCES, INC.
NON-EMPLOYEE DIRECTORS' STOCK INCENTIVE PLAN
(As amended May 26, 1999)
SECTION 1. PURPOSE
1.01 The purpose of the 1999 Equitable Resources, Inc. Non-Employee
Directors' Stock Incentive Plan (the "Plan") is to assist 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 Other Stock-Based
Award 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. References to particular
sections of the Code shall include any successor provisions.
2.01.5 "Change of Control" has the meaning provided in
Section 9.03.
2.01.6 "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 any member of the Committee participating in
the taking of any action under the Plan shall qualify as a
"non-employee director" as then defined under Rule 16b-3.
2.01.7 "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.
2.01.8 "Disability" means that a Participant is disabled
within the meaning of Section 422(c)(6) of the Code.
2.01.9 "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
2.01.10 "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 closing price for the
date as of which Fair Market Value is to be determined in the
principal market in which such shares are traded, as quoted in The
Wall Street Journal (or in such other reliable publication as the
Committee, in its discretion, may determine to rely upon). If the
Fair Market Value of shares on any date cannot be determined on the
basis set forth in the preceding sentence, 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.
2.01.11 "Option" means a right granted under Section
6.02 hereof to purchase Shares at a specified price during specified
time periods as provided in Section 6.02. Each Option shall be a
nonstatutory stock option, which is an Option not intended to meet
the requirements of Section 422 of the Code.
2.01.12 "Other Stock-Based Award" means an Award,
granted under Section 6.04 hereof, that is denominated or payable
in, valued in whole or in part by reference to, or otherwise based
on, or related to, Shares.
2.01.13 "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.
2.01.14 "Reload Option Rights" and "Reload Option" have
the meanings provided in Section 6.02.2(v).
2.01.15 "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.
2.01.16 "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.
2.01.17 "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.
2.01.18 "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.
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 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;
(iv) to determine the type or types of Other Stock-Based
Awards to be granted to each Participant;
(v) to determine the number of Other Stock-Based Awards
to be granted, the number of Shares or amount of cash or other
property to which an Other Stock-Based Award will relate, the terms
and conditions of any Other Stock-Based 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 Other
Stock-Based Award;
(vi) to determine whether, to what extent and under what
circumstances an Other Stock-Based Award may be settled in, or the
exercise price of an Other Stock-Based Award may be paid in cash,
Shares, other Awards or other property, or an Other Stock-Based
Award may be accelerated, vested, canceled, forfeited, exchanged or
surrendered;
(vii) to determine whether, to what extent and under
what circumstances cash, Shares, other Awards, other property and
other amounts payable with respect to an Other Stock-Based Award
shall be deferred, whether automatically or at the election of the
Committee or at the election of the Participant;
(viii) to prescribe the form of each Award Agreement,
which need not be identical for each Participant;
(ix) 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; and
(x) 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, 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 furnished 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 discretions granted by the Plan to the Committee shall
likewise be exercisable at any time by the Board.
SECTION 4. SHARES SUBJECT TO THE PLAN
4.01 The maximum net number of Shares which may be issued and in
respect of which Awards may be granted under the Plan shall be limited to
300,000 shares of Common Stock, subject to adjustment as provided in Section
8.01.
For purposes of this Section 4.01, the number of Shares to which an
Award relates shall be counted against the number of Shares 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 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 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. If the exercise price of an Award is paid
by delivering to the Company Shares previously owned by the Participant, the
Shares covered by the Award equal to the number of Shares so delivered shall
again be available for Awards 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 shall be granted only to Participants as defined in
Section 2.01.13.
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. Except as required by applicable law,
Awards may be granted for no consideration other than prior and/or future
services.
6.02 Automatic Option Grants.
6.02.1 Annual Option Grants. Subject to Section 12.01
hereof, 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.
6.02.2 Terms of Options. The Options granted under
Section 6.02.1 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.
(v) Reload Option Rights. Options granted
under this Section 6.02 shall have Reload Option Rights
which shall entitle the holder of the Option, upon
exercise of the Option or any portion thereof through
delivery of previously owned Shares, to automatically be
granted on the date of such exercise a new nonstatutory
stock option (a "Reload Option") (1) for a number of
Shares equal to the number of full Shares delivered in
payment of the option price of the original Option, (2)
having an option price equal to 100% of the Fair Market
Value per Share of the Common Stock on such date of
grant, (3) becoming exercisable six months from such
date of grant, (4) having the same expiration date as
the original Option so exercised and (5) having the same
other terms and conditions as apply to an Option granted
under Section 6.02.1. Subject to the preceding sentence
and the other provisions of the Plan, Reload Option
Rights and Reload Options shall have such additional
terms and be subject to such additional restrictions and
conditions, if any, as shall be determined, in its
discretion, by the Committee. The Committee may, in its
discretion, provide in an Award Agreement for such
limitations on the number or frequency of exercises of
Reload Option Rights, or the minimum numbers of Shares
for which such rights may be exercised, as the Committee
may deem advisable for the efficient administration of
the Plan. Reload Option Rights granted under this
Section 6.02 shall entitle the holder of an Option to be
granted a Reload Option only if the underlying Option to
which they relate is exercised during service as a
director of the Company of the original grantee of the
underlying Option. Except as otherwise specifically
provided herein or required by the context, the term
Option as used in this Plan shall include Reload Options
granted under this paragraph.
6.02.3 Allocation of Shares. If on any date on which
Options would otherwise be granted under this Section 6.02 the
number of Shares remaining available under Section 4.01 is not
sufficient for each Participant otherwise entitled to the grant of
an Option to be granted an Option for the full number of Shares
provided in this Section 6.02, then each such Participant shall
automatically be granted an Option 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 Option on such date and (2) the denominator
is the number of Shares for which all Participants would otherwise
be granted Options on such date, with any fractional shares being
disregarded.
6.03. Nature of Automatic Award Grants; Award Agreements. The grant
of the Awards provided for in Section 6.02 shall be automatic and not subject to
the discretion of the Committee or any other Person. However, the Committee may
condition the right of a Participant to be granted any such 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.
6.04 Other Stock-Based Awards. In addition to the automatic Awards
provided for in Section 6.02, 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, including, without limitation, stock
options or purchase rights having terms and conditions similar to or different
from Options granted under 6.02, Shares awarded subject to restrictions, 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 under, other compensation or incentive plans,
programs or arrangements of the Company for eligible Participants.
The Committee shall determine the terms and conditions of Other
Stock-Based Awards. Except as provided in the next paragraph, Shares or
securities delivered pursuant to a stock option or other purchase right granted
under this Section 6.04 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 combination thereof, 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.
Awards granted under this Section 6.04 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 any other plan, program or arrangement of the Company (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. The exercise price of an 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)
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.
6.05 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 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.
7.02 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 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 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. Except to the extent otherwise
determined by the Committee, 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, and any Option or other right to purchase or
acquire Shares granted to a Participant under the Plan shall be exercisable
during the Participant's lifetime only by such 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.
7.04 Registration and Listing Compliance. No Award shall be paid and
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 payment 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.
7.05 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 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.
SECTION 9. CHANGE OF CONTROL PROVISIONS
9.01 Acceleration of Exercisability and Lapse of Restrictions.
Unless otherwise determined by the Committee at the time of grant of an Award or
unless otherwise provided in the applicable Award Agreement, if the shareholders
of the Company shall approve a transaction which upon consummation would
constitute a Change of Control of the Company, or if any Change of Control of
the Company not subject to shareholder approval shall occur:
(i) all outstanding Awards pursuant to which the
Participant may have rights, the exercise of which is restricted or
limited, shall become fully exercisable;
(ii) all restrictions or limitations (including risks of
forfeiture and deferrals) on outstanding Awards subject to
restrictions or limitations under the Plan shall lapse unless prior
to such lapse the right to lapse of restrictions or limitations is
waived or deferred by the Participant; and
(iii) all 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.
9.02 Termination of Service Following Change of Control. If within
three years following the date of any Change of Control the service of a
Participant as a director of the Company shall be terminated voluntarily or
involuntarily for any reason, then unless otherwise provided in the applicable
Award Agreement, and in addition to any other rights of post-termination
exercise which the Participant (or other holder of the Award) may have under the
Plan or the applicable Award Agreement, any Option or other Award granted to the
Participant and outstanding on the date of the Change of Control, the payment or
receipt of which is dependent upon exercise by the Participant (or other holder
of the Award) shall be exercisable for a period of 90 days following the date of
such termination of service but not later than the expiration date of the Award.
9.03 Definition of Change of Control. For purposes of this Section
9, a "Change of Control" of the Company shall mean any of the following events:
(a) The sale or other disposition by the Company of all
or substantially all of its assets to a single purchaser or to a
group of purchasers, other than to a corporation with respect to
which, following such sale or disposition, more than eighty percent
of, respectively, the then outstanding shares of Common Stock and
the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of the Board is then
owned beneficially, directly or indirectly, by all or substantially
all of the individuals and entities who were the beneficial owners,
respectively of the outstanding Common Stock and the combined voting
power of the then outstanding voting securities immediately prior to
such sale or disposition in substantially the same proportion as
their ownership of the outstanding Common Stock and voting power
immediately prior to such sale or disposition;
(b) The acquisition in one or more transactions by any
person or group, directly or indirectly, of beneficial ownership of
twenty percent or more of the outstanding shares of Common Stock or
the combined voting power of the then outstanding voting securities
of the Company entitled to vote generally in the election of the
Board; provided, however, that any acquisition by (x) the Company or
any of its Subsidiaries, or any employee benefit plan (or related
trust) sponsored or maintained by the Company or any of its
Subsidiaries or (y) any person that is eligible, pursuant to Rule
13d-1(b) under the Exchange Act (as in effect on the effective date
of the Plan) to file a statement on Schedule 13G with respect to its
beneficial ownership of Common Stock and other voting securities,
whether or not such person shall have filed a statement on Schedule
13G, unless such person shall have filed a statement on Schedule 13D
with respect to beneficial ownership of fifteen percent or more of
the Company's voting securities, shall not constitute a Change of
Control;
(c) The Company's termination of its business and
liquidation of its assets;
(d) There is consummated a merger, consolidation,
reorganization, share exchange, or similar transaction involving the
Company (including a triangular merger), in any case, unless
immediately following such transaction: (i) all or substantially all
of the persons who were the beneficial owners of the outstanding
Commons Stock and outstanding voting securities of the Company
immediately prior to the transaction beneficially own, directly or
indirectly, more than 60% of the outstanding shares of Commons Stock
and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors
of the corporation resulting from such transaction (including a
corporation or other person which as a result of such transaction
owns the Company or all or substantially all of the Company's assets
through one or more subsidiaries (a "Parent Company")) in
substantially the same proportion as their ownership of the Common
Stock and other voting securities of the Company immediately prior
to the consummation of the transaction, (ii) no person (other than
the Company, any employee benefit plan sponsored or maintained by
the Company or, if reference was made to equity ownership of any
Parent Company for purposes of determining whether clause (i) above
is satisfied in connection with the transaction, such Parent
Company) beneficially owns, directly or indirectly, 20% or more of
the outstanding shares of Common Stock or the combined voting power
of the voting securities entitled to vote generally in the election
of directors of the corporation resulting from such transaction and
(iii) individuals who were members of the Board immediately prior to
the consummation of the transaction constitute at least a majority
of the members of the board of directors resulting from such
transaction (or, if reference was made to equity ownership of any
Parent Company for purposes of determining whether clause (i) above
is satisfied in connection with the transaction, such Parent
Company); or
(e) The following individuals cease for any reason to
constitute a majority of the number of directors then serving:
individuals who, on the date hereof, constitute the entire Board and
any new director (other than a director whose initial assumption of
office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose
appointment or election by the Board or nomination for election by
the Company's shareholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either
were directors on the effective date of the Plan or whose
appointment, election or nomination for election was previously so
approved.
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 by
the rules of any stock exchange on which the Shares may then be listed, or if
the Board determines that obtaining such shareholder approval is for any reason
advisable; provided, however, that 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.
10.02 Notwithstanding any of the provision of this Plan to the
contrary, except as provided in Section 8.01 of the Plan, the exercise price of
any outstanding Option or the exercise price or minimum purchase price of any
Other Stock-Based Award may not be reduced, whether through amendment,
cancellation or replacement, unless such reduction is approved by the
shareholders of the Company.
SECTION 11. GENERAL PROVISIONS
11.01 No Shareholder Rights. 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 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 or payments not yet made 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 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.
11.04 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. 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.
11.06 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 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
March 17, 1999, the date of adoption of the Plan by the Board, provided that
such adoption of the Plan is approved by a majority of the votes cast at a duly
held meeting of shareholders held on or prior to March 16, 2000 at which a
quorum representing a majority of the outstanding voting stock of the Company
is, either in person or by proxy, present and voting. Notwithstanding anything
else contained in the Plan or in any Award Agreement, no Option or other
purchase right granted under the Plan may be exercised, and no certificates for
Shares may be delivered 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.