EXHIBIT 10.4
Saucony, Inc.
1993 EQUITY INCENTIVE PLAN, AS AMENDED
(Restated as of May 18, 2000)
1 Purpose.
The purpose of this plan (the "Plan") is to secure for Saucony, Inc. (the
"Company") and its shareholders the benefits arising from capital stock
ownership by employees, officers and directors of, and consultants or advisors
to, the Company and its parent and subsidiary corporations who are expected to
contribute to the Company's future growth and success. Except where the context
otherwise requires, the term "Company" shall include the parent and all present
and future subsidiaries of the Company as defined in Sections 424(e) and 424(f)
of the Internal Revenue Code of 1986, as amended or replaced from time to time
(the "Code").
2 Type of Options and Awards; Administration.
a. Types of Options and Awards. Options granted pursuant to the Plan
shall be authorized by action of the Board of Directors of the Company
(or a Committee designated by the Board of Directors) and may be
either incentive stock options ("Incentive Stock Options") meeting the
requirements of Section 422 of the Code or non-statutory options which
are not intended to meet the requirements of Section 422 of the Code.
Awards granted pursuant to the Plan shall be authorized by action of
the Board of Directors of the Company (or a Committee designated by
the Board of Directors) and shall meet the requirements of Section 13
of the Plan.
b. Administration. The Plan will be administered by the Board of
Directors of the Company, whose construction and interpretation of the
terms and provisions of the Plan shall be final and conclusive. The
Board of Directors may in its sole discretion (i) grant options to
purchase shares of the Company's Common Stock (as defined in Section 4
of the Plan), and issue shares upon exercise of such options as
provided in the Plan and (ii) make awards for the purchase of shares
of Common Stock pursuant to Section 13 of the Plan. The Board shall
have authority, subject to the express provisions of the Plan, to
construe the respective option agreements, awards and the Plan, to
prescribe, amend and rescind rules and regulations relating to the
Plan, to determine the terms and provisions of the respective option
agreements and awards, which need not be identical, and to make all
other determinations in the judgment of the Board of Directors
necessary or desirable for the administration of the Plan. The Board
of Directors may correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any option agreement or
award in the manner and to the extent it shall deem expedient to carry
the Plan into effect and it shall be the sole and final judge of such
expediency. No director or person acting pursuant to authority
delegated by the Board of Directors shall be liable for any action or
determination made in good faith. The Board of Directors may, to the
full extent permitted by or consistent with applicable laws or
regulations (including, without limitation, applicable state law and
Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the
"Exchange Act"), or any successor rule ("Rule 16b-3")), delegate any
or all of its powers under the Plan to a committee (the "Committee")
appointed by the Board of Directors, and if the Committee is so
appointed all references to the Board of Directors in the Plan shall
mean and relate to such Committee to the extent authority is so
delegated to such Committee.
c. Applicability of Rule 16b-3. Those provisions of the Plan which make
express reference to Rule 16b-3 shall apply only to such persons as
are required to file reports under Section 16(a) of the Exchange Act
(a "Reporting Person").
3 Eligibility.
a. General. Options and awards may be granted or made to persons who are,
at the time of grant, employees, officers or directors (so long as
such officers and directors are also employees) of, or consultants or
advisors to, the Company; provided, that the class of employees to
whom Incentive Stock Options may be granted shall be limited to all
employees of the Company; and provided further that non-employee
directors of the Company are not eligible to receive options or awards
of restricted stock under the Plan. A person who has been granted an
option or award may, if he or she is otherwise eligible, be granted
additional options or awards if the Board of Directors shall so
determine. Subject to adjustment as provided in Section 16 below, the
maximum number of shares with respect to which options or restricted
stock awards may be granted to any person under the Plan shall not
exceed 150,000 shares of Common Stock (as defined in Section 4 below)
during any calendar year during the term of the Plan. For the purpose
of calculating such maximum number, (a) an option or award shall
continue to be treated as outstanding notwithstanding its repricing,
cancellation or expiration and (b) the repricing of an outstanding
option or award or the issuance of a new option or award in
substitution for a cancelled option or award shall be deemed to
constitute the grant of a new additional option or award, as the case
may be, separate from the original grant that is repriced or
cancelled.
b. Grant of Options to Directors and Officers. The selection of a
director or an officer (as the terms "director" and "officer" are
defined for purposes of Rule 16b-3) as a participant, the timing of
the option grant or award, the exercise price of the option or the
sale price of the award and the number of shares for which an option
or award may be granted to such director or officer shall be
determined either (i) by the Board of Directors, of which all members
shall be "disinterested persons" (as hereinafter defined), or (ii) by
a committee of two or more directors having full authority to act in
the matter, of which all members shall be "disinterested persons." For
the purposes of the Plan, a director shall be deemed to be
"disinterested" only if such person qualifies as a "disinterested
person" within the meaning of Rule 16b-3, as such term is interpreted
from time to time.
4 Stock Subject to Plan.
Subject to adjustment as provided in Section 16 below, the total number of
shares of Class A Common Stock, $.33-1/3 par value per share ("Class A
Common Stock"), and Class B Common Stock, $.33-1/3 par value per share
("Class B Common Stock"), which may be issued and sold under the Plan is
1,150,000 shares in the aggregate. The term "Common Stock" as used herein
shall refer to Class A Common Stock or Class B Common Stock as the case may
be. If an option granted under the Plan shall expire or terminate for any
reason without having been exercised in full, the unpurchased shares
subject to such option shall again be available for subsequent option
grants or awards under the Plan.
5 Forms of Option Agreements.
As a condition to the grant of an option under the Plan, each recipient of
an option shall execute an option agreement in such form not inconsistent
with the Plan as may be approved by the Board of Directors. Such option
agreements may differ among recipients.
6 Purchase Price Upon Exercise of Options.
a. General. The purchase price per share of Common Stock deliverable upon
the exercise of an option shall be determined by the Board of
Directors, provided, however, that in the case of an Incentive Stock
Option, the exercise price shall not be less than 100% of the fair
market value of such stock, as determined by the Board of Directors,
at the time of grant of such option, or less than 110% of such fair
market value in the case of options described in Section 11(b).
b. Payment of Purchase Price. Options granted under the Plan may provide
for the payment of the exercise price by delivery of cash or a check
to the order of the Company in an amount equal to the exercise price
of such options, or, to the extent provided in the applicable option
agreement, (i) by delivery to the Company of shares of Common Stock of
the Company already owned by the optionee having a fair market value
equal in amount to the exercise price of the options being exercised,
(ii) by any other means (including without limitation by delivery of a
promissory note of the optionee payable on such terms as are specified
by the Board of Directors) which the Board of Directors determines are
consistent with the purpose of the Plan and with applicable laws and
regulations (including, without limitation, the provisions of Rule
16b-3 and Regulation T promulgated by the Federal Reserve Board) or
(iii) by any combination of such methods of payment. The fair market
value of any shares of the Company's Common Stock or other non-cash
consideration which may be delivered upon exercise of an option shall
be determined in such manner as may be prescribed by the Board of
Directors.
7 Option Period.
Each option and all rights thereunder shall expire on such date as shall be
set forth in the applicable option agreement, except that such date, in the
case of an Incentive Stock Option, shall in no case be later than ten years
after the date on which the option is granted.
8 Exercise of Options.
Each option granted under the Plan shall be exercisable either in full or
in installments at such time or times and during such period as shall be
set forth in the agreement evidencing such option, subject to the
provisions of the Plan.
9 Nontransferability of Options.
Incentive Stock Options, and all options granted to Reporting Persons,
shall not be assignable or transferable by the person to whom it is
granted, either voluntarily or by operation of law, except by will or the
laws of descent and distribution, and, during the life of the optionee,
shall be exercisable only by the optionee; provided, however, that
non-statutory options granted to Reporting Persons may be transferred
pursuant to a qualified domestic relations order (as defined in Rule
16b-3).
10 Effect of Termination of Employment or Other Relationship.
The Board of Directors shall determine the period of time during which an
optionee may exercise an option following (i) the termination of the
optionee's employment or other relationship with the Company or (ii) the
death or disability of the optionee. Such periods shall be set forth in the
agreement evidencing such option.
11 Incentive Stock Options.
Options granted under the Plan which are intended to be Incentive Stock
Options shall be subject to the following additional terms and conditions:
a. Express Designation. All Incentive Stock Options granted under the
Plan shall, at the time of grant, be specifically designated as such
in the option agreement covering such Incentive Stock Options.
b. 10% Shareholder. If any employee to whom an Incentive Stock Option is
to be granted under the Plan is, at the time of the grant of such
option, the owner of stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company (after
taking into account the attribution of stock ownership rules of
Section 424(d) of the Code), then the following special provisions
shall be applicable to the Incentive Stock Option granted to such
individual:
i. The purchase price per share of the Common Stock subject to such
Incentive Stock Option shall not be less than 110% of the fair
market value of one share of Common Stock at the time of grant;
and
ii. The option exercise period shall not exceed five years from the
date of grant.
c. Dollar Limitation. For so long as the Code shall so provide, options
granted to any employee under the Plan (and any other incentive stock
option plans of the Company) which are intended to constitute
Incentive Stock Options shall not constitute Incentive Stock Options
to the extent that such options, in the aggregate, become exercisable
for the first time in any one calendar year for shares of Common Stock
with an aggregate fair market value (determined as of the respective
date or dates of grant) of more than $100,000.
d. Termination of Employment, Death or Disability. No Incentive Stock
Option may be exercised unless, at the time of such exercise, the
optionee is, and has been continuously since the date of grant of his
or her option, employed by the Company, except that:
i. an Incentive Stock Option may be exercised within the period of
three months after the date the optionee ceases to be an employee
of the Company (or within such lesser period as may be specified
in the applicable option agreement), provided, that the agreement
with respect to such option may designate a longer exercise
period and that the exercise after such three- month period shall
be treated as the exercise of a non-statutory option under the
Plan;
ii. if the optionee dies while in the employ of the Company, or
within three months after the optionee ceases to be such an
employee, the Incentive Stock Option may be exercised, by the
person to whom it is transferred by will or the laws of descent
and distribution, within the period of one year after the date of
death (or within such lesser period as may be specified in the
applicable option agreement); and
iii. if the optionee becomes disabled (within the meaning of Section
22(e)(3) of the Code or any successor provision thereto) while in
the employ of the Company, the Incentive Stock Option may be
exercised within the period of one year after the date the
optionee ceases to be such an employee because of such disability
(or within such lesser period as may be specified in the
applicable option agreement).
For all purposes of the Plan and any option or award granted hereunder,
"employment" shall be defined in accordance with the provisions of Section
1.421-7(h) of the Income Tax Regulations (or any successor regulations).
Notwithstanding the foregoing provisions, no stock option may be exercised after
its expiration date.
12 Additional Provisions.
a. Additional Option Provisions. The Board of Directors may, in its sole
discretion, include additional provisions in any option granted under
the Plan, including without limitation restrictions on transfer,
repurchase rights, commitments to pay cash bonuses, to make, arrange
for or guaranty loans or to transfer other property to optionees upon
exercise of options, or such other provisions as shall be determined
by the Board of Directors; provided that such additional provisions
shall not be inconsistent with any other term or condition of the
Plan.
b. Acceleration, Extension, Etc. The Board of Directors may, in its sole
discretion, (i) accelerate the date or dates on which all or any
particular option or options granted under the Plan may be exercised
or (ii) extend the dates during which all or any particular option or
options granted under the Plan may be exercised; provided, however,
that no such extension shall be permitted if it would cause the Plan
to fail to comply with Section 422 of the Code or with Rule 16b-3.
13 Awards.
A restricted stock award ("award") shall consist of the sale and issuance
by the Company of shares of Common Stock, and purchase by the recipient of
such shares, subject to the terms, conditions and restrictions described in
the document evidencing the award and in this Section 13 and elsewhere in
the Plan.
a. Execution of Restricted Stock Award Agreement. As a condition to an
award under the Plan, each recipient of an award shall execute an
agreement in such form, which may differ among recipients, as shall be
specified by the Board of Directors at the time of such award.
b. Price. The Board of Directors shall determine the price at which
shares of Common Stock shall be sold to recipients of awards under the
Plan. The Board of Directors may, in its discretion, issue shares
pursuant to awards without the payment of any cash purchase price by
the recipients or issue shares pursuant to awards at a purchase price
below the then fair market value of the Common Stock. If a purchase
price is required to be paid, it shall be paid in cash or by check
payable to the order of the Company at the time that the award is
accepted by the recipient, or by such other means as may be approved
by the Board of Directors.
c. Number of Shares. The award shall specify the number of shares of
Common Stock granted thereunder.
d. Restrictions on Transfer. In addition to such other terms, conditions
and restrictions upon awards as shall be imposed by the Board of
Directors, all shares issued pursuant to an award shall be subject to
the following restrictions:
(1) All shares of Common Stock subject to an award (including any
shares issued pursuant to paragraph (e) of this Section) shall be
subject to certain restrictions on disposition and obligations of
resale to the Company as provided in subparagraph (2) below for
the period specified in the document evidencing the award, and
shall not be sold, assigned, transferred, pledged, hypothecated
or otherwise disposed of until such restrictions lapse. The
period during which such restrictions are applicable is referred
to as the "Restricted Period."
(2) In the event that a recipient's employment with the Company (or
consultancy or advisory relationship, as the case may be) is
terminated within the Restricted Period, whether such termination
is voluntary or involuntary, with or without cause, or because of
the death or disability of the recipient, the Company shall have
the right and option for a period of three months following such
termination to buy for cash that number of the shares of Common
Stock purchased under the award as to which the restrictions on
transfer and the forfeiture provisions contained in the award
have not then lapsed, at a price equal to the price per share
originally paid by the recipient. If such termination occurs
within the last three months of the applicable restrictions, the
restrictions and repurchase rights of the Company shall continue
to apply until the expiration of the Company's three month option
period.
(3) Notwithstanding subparagraphs (1) and (2) above, the Board of
Directors may, in its discretion, either at the time that an
award is made or at any time thereafter, waive its right to
repurchase shares of Common Stock upon the occurrence of any of
the events described in this paragraph (d) or remove or modify
any part or all of the restrictions. In addition, the Board of
Directors may, in its discretion, impose upon the recipient of an
award at the time of such award such other restrictions on any
shares of Common Stock issued pursuant to such award as the Board
of Directors may deem advisable.
e. Additional Shares. Any shares received by a recipient of an award as a
stock dividend on, or as a result of stock splits, combinations,
exchanges of shares, reorganizations, mergers, consolidations or
otherwise with respect to, shares of Common Stock received pursuant to
such award shall have the same status and shall bear the same
restrictions, all on a proportionate basis, as the shares initially
purchased pursuant to such award.
f. Transfers in Breach of Award. If any transfer of shares purchased
pursuant to an award is made or attempted contrary to the terms of the
Plan and of such award, the Board of Directors shall have the right to
purchase for the account of the Company those shares from the owner
thereof or his or her transferee at any time before or after the
transfer at the price paid for such shares by the person to whom they
were awarded under the Plan. In addition to any other legal or
equitable remedies which it may have, the Company may enforce its
rights by specific performance to the extent permitted by law. The
Company may refuse for any purpose to recognize as a shareholder of
the Company any transferee who receives any shares contrary to the
provisions of the Plan and the applicable award or any recipient of an
award who breaches his or her obligation to resell shares as required
by the provisions of the Plan and the applicable award, and the
Company may retain and/or recover all dividends on such shares which
were paid or payable subsequent to the date on which the prohibited
transfer or breach was made or attempted.
g. Additional Award Provisions. The Board of Directors may, in its sole
discretion, include additional provisions in any award granted under
the Plan, including without limitation commitments to pay cash
bonuses, make, arrange for or guarantee loans or transfer other
property to recipients upon the grant of awards, or such other
provisions as shall be determined by the Board of Directors.
14 General Restrictions.
a. Investment Representations. The Company may require any person to whom
an option or award is granted, as a condition of exercising such
option or purchasing the shares subject to the award, to give written
assurances in substance and form satisfactory to the Company to the
effect that such person is acquiring the Common Stock subject to the
option or award for his or her own account for investment and not with
any present intention of selling or otherwise distributing the same,
and to such other effects as the Company deems necessary or
appropriate in order to comply with federal and applicable state
securities laws.
b. Compliance With Securities Laws. Each option and award shall be
subject to the requirement that if, at any time, counsel to the
Company shall determine that the listing, registration or
qualification of the shares subject to such option or award upon any
securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, or that the
disclosure of non-public information or the satisfaction of any other
condition is necessary as a condition of, or in connection with, the
issuance or purchase of shares thereunder, such option or award may
not be exercised, in whole or in part, unless such listing,
registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions
acceptable to the Board of Directors. Nothing herein shall be deemed
to require the Company to apply for or to obtain such listing,
registration or qualification, or to satisfy such condition.
15 Rights as a Shareholder.
The holder of an option or recipient of an award shall have no rights as a
shareholder with respect to any shares covered by the option or award
(including, without limitation, any rights to receive dividends or non-cash
distributions with respect to such shares) until the date of issue of a
stock certificate to him or her for such shares. No adjustment shall be
made for dividends or other rights for which the record date is prior to
the date such stock certificate is issued.
16 Adjustment Provisions for Recapitalizations and Related Transactions.
a. General. If, through or as a result of any merger, consolidation, sale
of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend,
stock split, reverse stock split or other similar transaction, (i) the
outstanding shares of Common Stock are increased or decreased or are
exchanged for a different number or kind of shares or other securities
of the Company, or (ii) additional shares or new or different shares
or other securities of the Company or other non-cash assets are
distributed with respect to such shares of Common Stock or other
securities, an appropriate and proportionate adjustment shall be made
in (x) the maximum number and kind of shares reserved for issuance
under the Plan, (y) the number and kind of shares or other securities
subject to then outstanding options under the Plan, and (z) the price
for each share subject to any then outstanding options under the Plan
or repurchase rights of the Company, without changing the aggregate
purchase price as to which such options remain exercisable, provided
that no adjustment shall be made pursuant to this Section 16 if such
adjustment would cause the Plan to fail to comply with Section 422 of
the Code or with Rule 16b-3.
b. Board Authority to Make Adjustments. Any adjustments under this
Section 16 will be made by the Board of Directors, whose determination
as to what adjustments, if any, will be made and the extent thereof
will be final, binding and conclusive. No fractional shares will be
issued under the Plan on account of any such adjustments.
17 Merger, Consolidation, Asset Sale, Liquidation, etc.
a. General. In the event of a consolidation or merger in which
outstanding shares of Common Stock are exchanged for securities, cash
or other property of any other corporation or business entity or in
the event of a liquidation of the Company or sale of all or
substantially all of the assets of the Company, the Board of Directors
of the Company, or the board of directors of any corporation assuming
the obligations of the Company, may, in its discretion, take any one
or more of the following actions, as to outstanding options and
awards: (i) provide that such options shall be assumed, or equivalent
options shall be substituted, by the acquiring or succeeding
corporation (or an affiliate thereof), provided that any such options
substituted for Incentive Stock Options shall meet the requirements of
Section 424(a) of the Code, (ii) upon written notice to the optionees,
provide that all unexercised options will terminate immediately prior
to the consummation of such transaction unless exercised by the
optionee within a specified period following the date of such notice,
(iii) in the event of a merger under the terms of which holders of the
Common Stock of the Company will receive upon consummation thereof a
cash payment for each share surrendered in the merger (the "Merger
Price"), make or provide for a cash payment to the optionees equal to
the difference between (A) the Merger Price times the number of shares
of Common Stock subject to such outstanding options (to the extent
then exercisable at prices not in excess of the Merger Price) and (B)
the aggregate exercise price of all such outstanding options in
exchange for the termination of such options, and (iv) provide that
all or any outstanding options shall become exercisable in full, any
restrictions on exercising outstanding options issued pursuant to the
Plan prior to any given date shall terminate and any restrictions on
and rights of the Company to repurchase shares covered by outstanding
awards issued pursuant to the Plan shall terminate.
b. Substitute Options. The Company may grant options under the Plan in
substitution for options held by employees of another corporation who
become employees of the Company, or a subsidiary of the Company, as
the result of a merger or consolidation of the employing corporation
with the Company or a subsidiary of the Company, or as a result of the
acquisition by the Company, or one of its subsidiaries, of property or
stock of the employing corporation. The Company may direct that
substitute options be granted on such terms and conditions as the
Board of Directors considers appropriate in the circumstances.
18 No Special Employment Rights.
Nothing contained in the Plan or in any option or award shall confer upon
any recipient of an award or optionee any right with respect to the
continuation of his or her employment by the Company or interfere in any
way with the right of the Company at any time to terminate such employment
or to increase or decrease the compensation of the optionee.
19 Other Employee Benefits.
Except as to plans which by their terms include such amounts as
compensation, neither the amount of any compensation deemed to be received
by an employee as a result of the exercise of an option or the sale of
shares received upon such exercise nor the value of an award granted to an
employee will constitute compensation with respect to which any other
employee benefits of such employee are determined, including, without
limitation, benefits under any bonus, pension, profit-sharing, life
insurance or salary continuation plan, except as otherwise specifically
determined by the Board of Directors.
20 Amendment of the Plan.
a. The Board of Directors may at any time, and from time to time, modify
or amend the Plan in any respect, except that if at any time the
approval of the shareholders of the Company is required as to such
modification or amendment under Section 422 of the Code or any
successor provision with respect to Incentive Stock Options or under
Rule 16b-3 with respect to options held by or awards made to Reporting
Persons, the Board of Directors may not effect such modification or
amendment without such approval.
b. The termination or any modification or amendment of the Plan shall
not, without the consent of an optionee or recipient of an award,
affect his or her rights under an option or award previously granted
to him or her. With the consent of the optionee or recipient of the
award affected, the Board of Directors may amend outstanding option
agreements or awards in a manner not inconsistent with the Plan. The
Board of Directors shall have the right to amend or modify (i) the
terms and provisions of the Plan and of any outstanding Incentive
Stock Options granted under the Plan to the extent necessary to
qualify any or all such options for such favorable federal income tax
treatment (including deferral of taxation upon exercise) as may be
afforded incentive stock options under Section 422 of the Code and
(ii) the terms and provisions of the Plan and of any outstanding
option or award to the extent necessary to ensure the qualification of
the Plan under Rule 16b-3 or any successor rule.
21 Withholding.
a. The Company shall have the right to deduct from payments of any kind
otherwise due to the optionee or recipient of an award any federal,
state or local taxes of any kind required by law to be withheld with
respect to any shares issued upon exercise of options under the Plan
or the purchase of shares subject to the award. Subject to the prior
approval of the Company, which may be withheld by the Company in its
sole discretion, the optionee or recipient of an award may elect to
satisfy such obligations, in whole or in part, (i) by causing the
Company to withhold shares of Common Stock otherwise issuable pursuant
to the exercise of an option or the purchase of shares subject to an
award or (ii) by delivering to the Company shares of Common Stock
already owned by the optionee or award recipient. The shares so
delivered or withheld shall have a fair market value equal to such
withholding obligation. The fair market value of the shares used to
satisfy such withholding obligation shall be determined by the Company
as of the date that the amount of tax to be withheld is to be
determined. An optionee or award recipient who has made an election
pursuant to this Section 21(a) may only satisfy his or her withholding
obligation with shares of Common Stock which are not subject to any
repurchase, forfeiture, unfulfilled vesting or other similar
requirements.
b. Notwithstanding the foregoing, in the case of a Reporting Person, no
election to use shares for the payment of withholding taxes shall be
effective unless made in compliance with any applicable requirements
of Rule 16b-3.
c. If the recipient of an award under the Plan elects, in accordance with
Section 83(b) of the Code, to recognize ordinary income in the year of
acquisition of any shares awarded under the Plan, the Company will
require at the time of such election an additional payment for
withholding tax purposes based on the difference, if any, between the
purchase price of such shares and the fair market value of such shares
as of the date immediately preceding the date of the award.
22 Cancellation and New Grant of Options, Etc.
The Board of Directors shall have the authority to effect, at any time and
from time to time, with the consent of the affected optionees, (i) the
cancellation of any or all outstanding options under the Plan and the grant
in substitution therefor of new options under the Plan covering the same or
different numbers of shares of Common Stock and having an option exercise
price per share which may be lower or higher than the exercise price per
share of the cancelled options or (ii) the amendment of the terms of any
and all outstanding options under the Plan to provide an option exercise
price per share which is higher or lower than the then-current exercise
price per share of such outstanding options.
23 Effective Date and Duration of the Plan.
a. Effective Date. The Plan shall become effective when adopted by the
Board of Directors, but no Incentive Stock Option granted under the
Plan shall become exercisable unless and until the Plan shall have
been approved by the Company's shareholders. If such shareholder
approval is not obtained within twelve months after the date of the
Board's adoption of the Plan, no options previously granted under the
Plan shall be deemed to be Incentive Stock Options and no Incentive
Stock Options shall be granted thereafter. Amendments to the Plan not
requiring shareholder approval shall become effective when adopted by
the Board of Directors; amendments requiring shareholder approval (as
provided in Section 20) shall become effective when adopted by the
Board of Directors, but no Incentive Stock Option issued after the
date of such amendment shall become exercisable (to the extent that
such amendment to the Plan was required to enable the Company to grant
such Incentive Stock Option to a particular optionee) unless and until
such amendment shall have been approved by the Company's shareholders.
If such shareholder approval is not obtained within twelve months of
the Board's adoption of such amendment, any Incentive Stock Options
granted on or after the date of such amendment shall terminate to the
extent that such amendment to the Plan was required to enable the
Company to grant such option to a particular optionee. Subject to this
limitation, options and awards may be granted under the Plan at any
time after the effective date and before the date fixed for
termination of the Plan.
b. Termination. Unless sooner terminated in accordance with Section 17,
the Plan shall terminate, with respect to Incentive Stock Options,
upon the earlier of (i) the close of business on the day next
preceding the tenth anniversary of the date of its adoption by the
Board of Directors, or (ii) the date on which all shares available for
issuance under the Plan shall have been issued pursuant to the
exercise or cancellation of options or the final vesting of awards
granted under the Plan. Unless sooner terminated in accordance with
Section 17, the Plan shall terminate with respect to options which are
not Incentive Stock Options and awards on the date specified in (ii)
above. If the date of termination is determined under (i) above, then
options outstanding on such date shall continue to have force and
effect in accordance with the provisions of the instruments evidencing
such options.
24 Provision for Foreign Participants.
The Board of Directors may, without amending the Plan, modify awards or
options granted to participants who are foreign nationals or employed
outside the United States to recognize differences in laws, rules,
regulations or customs of such foreign jurisdictions with respect to tax,
securities, currency, employee benefit or other matters.
Plan/Amendment Adopted by the Adopted by the
Board of Directors Stockholders
- --------------- ------------------ --------------
Plan April 7, 1993 May 25, 1993
Amendment No. 1 January 3, 1994 May 26, 1994
Amendment No. 2 March 19, 1997 May 15, 1997
Amendment No. 3 March 20, 2000 May 18, 2000