EXHIBIT 10(d)
ONEIDA LTD
1998 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
1. Purposes
The purposes of the Plan are to attract, retain and compensate
highly qualified individuals who are not employees of the Company for service
as members of the Board of Directors of the Company and to provide them with an
ownership interest in the Company's Common Stock. The Plan will be beneficial
to the Company and its stockholders by allowing Non-Employee Directors to (i)
have a personal financial stake in the Company through an ownership interest in
the Company's Common Stock and (ii) underscore their common interest with
stockholders in increasing the value of the Company's Common Stock over the
long term.
2. Definitions and Rules of Construction
(a) Definitions. For purposes of this Plan, the following capitalized
words shall have the meanings set forth below:
"Annual Award" means an award of Options pursuant to Section 5(b) of the Plan.
"Annual Meeting" means an annual meeting of the Company's stockholders.
"Board" means the Board of Directors of the Company.
"Change of Control of the Company" shall be deemed to occur if any of the
following circumstances shall occur:
(i) any "person" or "group" within the meaning of Sections 13(d) and
14(d)(2) of the Securities Exchange Act of 1934 ("Act") becomes the "beneficial
owner" as defined in Rule 13d-3 under the Act of more than 20% of the then
outstanding voting securities of the Company;
(ii) any "person" or "group" within the meaning of Sections 13(d) and
14(d)(2) of the Act acquires by proxy or otherwise the right to vote for the
election of directors, for any merger or consolidation of the Company or for
any other matter or question with respect to more than 20% of the then
outstanding voting securities of the Company;
(iii) during any period of twenty-four consecutive months, Present
Directors and/or New Directors cease for any reason to constitute a majority of
the Board.
For these purposes, "Present Directors" shall mean individuals who
at the beginning of such consecutive twenty-four month period were members of
the Board and "New Directors" shall mean any director whose election by the
Board or whose nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds of the Directors then still in office
who were Present Directors or New Directors;
(iv) the stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company; or
(v) there shall be consummated:
(a) a reorganization, merger or consolidation of all or substantially
all of the assets of the Company (a "Business Combination"), unless, following
such Business Combination,
(1) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the outstanding Common Stock of the
Company and outstanding voting securities of the Company immediately prior to
such Business Combination beneficially own, directly or indirectly, more than
50% 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 directors, as the case may be, of the
corporation resulting from such Business Combination (including, without
limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either
directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Business
Combination of the outstanding Common Stock of the Company and outstanding
voting securities of the Company, as the case may be,
(2) no person (excluding any company resulting from such
Business Combination or any employee benefit plan (or related trust) of the
Company or such company resulting from such Business Combination) beneficially
owns, directly or indirectly, 20% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business
Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and
(3) at least a majority of the members of the board of
directors of the corporation resulting from such Business Combination were
members of the Board at the time of the execution of the initial agreement, or
of the action of the Board, providing for such Business Combination; or
(b) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all, or substantially all, of the
assets of the Company, provided, that the divestiture of less than
substantially all of the assets of the Company in one transaction or a series
of related transactions, whether effected by sale, lease, exchange, spin-off,
sale of the stock or merger of a subsidiary or otherwise, shall not constitute
a Change of Control.
Notwithstanding the foregoing, a Change of Control shall not be deemed to
occur pursuant to subparagraphs (i) and (ii) above, solely because twenty
percent (20%) or more of the combined voting power of the Company's then
outstanding securities is acquired by one or more employee benefit plans
maintained by the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the committee designated by the Board pursuant to Section
3(c) of the Plan.
"Common Stock" means the Common Stock of the Company, par value $1.00 per
share, or such other class or kind of shares or other securities as may be
applicable under Section 12.
"Company" means Oneida Ltd., a New York corporation, or any successor to
substantially all its business.
"Effective Date" means January 1, 1998.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fair Market Value" means, with respect to a share of Common Stock, the
fair market value thereof as of the relevant date of determination, as
determined in accordance with a valuation methodology approved by the
Committee. In the absence of any alternative valuation methodology approved
by the Committee, the Fair Market Value of a share of Common Stock shall equal
the closing price of a share of Common Stock as reported on the composite tape
for securities listed on the New York Stock Exchange, or such other
national securities exchange as may be designated by the Committee, or, in the
event that the Common Stock is not listed for trading on a national securities
exchange but is quoted on an automated system, on such automated system, in any
such case on the valuation date (or, if there were no sales on the valuation
date, the closing price as reported on said composite tape or automated system
for the most recent day during which a sale occurred).
"Initial Award" means an award of Options pursuant to Section 5(a) of the
Plan.
"Non-Employee Director" means a member of the Board who is not an employee of
the Company or a Subsidiary.
"Option" means an option to purchase shares of Common Stock awarded to a
Non-Employee Director pursuant to the Plan. Options awarded pursuant to this
Plan shall be non-statutory stock options
"Option Shares" means the shares of Common Stock issuable upon exercise of a
Option.
"Permanent Disability" means a medically determinable physical or mental
impairment rendering a Non-Employee Director substantially unable to function as
a member of the Board for any period of six consecutive months. Any dispute as
to whether a Non-Employee Director is Permanently Disabled shall be resolved
by a physician mutually acceptable to the Non-Employee Director and the Company,
whose decision shall be final and binding upon the Non-Employee Director and
the Company.
"Plan" means the Oneida Ltd. 1998 Non-Employee Directors Stock Option Plan as
described herein.
"Retirement" means a Non-Employee Director ceasing to be a member of the Board
as a result of retirement from the Board in accordance with the retirement
policy then applicable to Board members.
"Subsidiary" means (i) a domestic or foreign corporation or other entity with
respect to which the Company, directly or indirectly, has the power, whether
through the ownership of voting securities, by contract or otherwise, to
elect at least a majority of the members of such corporation's board of
directors or analogous governing body, or (ii) any other domestic or foreign
corporation or other entity in which the Company, directly or indirectly,
has an equity or similar interest and which the Committee designates as a
Subsidiary for purposes of the Plan.
"1933 Act" means the Securities Act of 1933, as amended.
(b) Rules of Construction. The masculine pronoun shall be deemed to
include the feminine pronoun and the singular form of a word shall be deemed to
include the plural form, unless the context requires otherwise. Unless the
text indicates otherwise, references to sections are to sections of the Plan.
3. Shares Available; Administration
(a) Subject to the provisions of Section 10(b) of the Plan, the maximum
number of shares of Common Stock which may be issued under the Plan shall not
exceed 100,000 shares. Either authorized and unissued shares of Common Stock
or treasury shares may be delivered upon exercise of Options awarded pursuant to
the Plan.
(b) If Options have been forfeited to the Company as described in
Section 6(c) or are terminated unexercised, the Options Shares underlying
such Options shall again be available for issuance in connection with future
awards under the Plan.
(c) The Plan will be administered by a committee designated by the Board
and composed exclusively of members of the Board who are not Non-Employee
Directors (the "Committee"). Subject to the provisions of this Plan, the
Committee shall have full and final authority to (i) interpret the Plan; (ii)
establish, amend and rescind any rules and regulations relating to the Plan;
(iii) prescribe award documentation; (iv) make factual determinations in
connection with the administration or interpretation of the Plan; and (v)
take any other actions necessary or advisable for the administration of the
Plan. The Committee's interpretation of the Plan, and all actions taken and
determinations made by the Committee pursuant to the powers vested in it
hereunder, shall be conclusive and binding upon all parties concerned including
the Company, its stockholders and persons granted Options under the Plan. The
Chairman of the Board of the Company shall be authorized to implement the Plan
in accordance with its terms and to take or cause to be taken such actions of a
ministerial nature as shall be necessary to effectuate the intent and
purposes thereof.
4. Eligibility
Options awarded pursuant to the Plan shall be granted only to active
members of the Board who are not, as of the date of any Option grants, employees
of the Company or any of its Subsidiaries or affiliates.
5. Option Grant
(a) Initial Award. On the date of a Non-Employee Director's initial
election or appointment to the Board, such Non-Employee Director (including
any Non-Employee Director reelected or reappointed after a period of at least
12 calendar months during which he did not serve on the Board) shall be granted
an Initial Award consisting of an Option to purchase 1,000 shares of Common
Stock. Such Option shall have a per share exercise price equal to the Fair
Market Value of the Common Stock on the date of the award and shall be subject
to the vesting schedule provided for in Section 6(a) and the other terms and
conditions provided for herein.
(b) Annual Awards. At each Annual Meeting during the term of the Plan,
each person who has continuously served as a member of the Board since the
immediately preceding Annual Meeting (or in the case of the Annual Meeting held
in 1998, each person who has served as a member of the Board since the Effective
Date), and who is reelected at such Annual Meeting or who will otherwise
continue to serve on the Board following such Annual Meeting, will receive
an Annual Award consisting of an Option to purchase 1,000 shares of Common Stock
(or such lesser number determined by multiplying 1,000 by a fraction, the
numerator of which is the number of full or partial months since the
immediately preceding Annual Meeting during which such person served on the
Board in the capacity of a Non-Employee Director, and the denominator of
which is the number of full or partial months since the immediately
preceding Annual Meeting). The Option shall have a per share exercise price
equal to the Fair Market Value of the Common Stock on the date such Option is
granted and shall be subject to the vesting schedule provided for in Section
6(a) and the other terms and conditions provided for herein.
6. Vesting
(a) Vesting. Options awarded pursuant to the Plan shall vest and become
exercisable upon the earlier of (i) twelve months from the date of the Option
grant or (ii) the Annual Meeting which is immediately following the Annual
Meeting of such Option grant.
(b) Accelerated Vesting. Notwithstanding anything to the contrary in
Section 6(a), an Option shall become fully vested and exercisable upon the
earlier to occur of (i) a Non-Employee Director ceasing to be a member of the
Board as a result of death, Permanent Disability or Retirement, or (ii) a
Change of Control of the Company.
(c) Forfeiture. In the event of a Non-Employee Director's termination of
service as a member of the Board for any reason other than death, Permanent
Disability, Retirement or a Change of Control of the Company prior to the
satisfaction of the vesting period described in Section 6(a), the unvested
portion of any Options awarded to the Non-Employee Director shall be forfeited
to the Company as of the date of termination of service, and the Non-employee
Director shall have no further rights or interest therein.
7. Term of Options
(a) Ten-Year Term. Each Option shall expire ten years from the date of its
grant, subject to earlier termination as provided herein.
(b) Exercise Following Certain Terminations of Service. If a Non-Employee
Director's service as a member of the Board terminates for any reason other
than death, Permanent Disability, Retirement or a Change of Control of the
Company, the Non-Employee Director shall have the right, subject to the terms
and conditions hereof, to exercise the Option, to the extent it has vested as of
the date of such termination of service, at any time within six months after the
date of such termination, subject to the earlier expiration of the Option as
provided in Section 7(a). At the end of such six-month period the Option shall
expire.
(c) Exercise Following Termination of Service Due to Death, Permanent
Disability, Retirement or a Change of Control of the Company. If a Non-
Employee Director's service as a member of the Board terminates by reason of
death, Permanent Disability, Retirement or a Change of Control of the Company,
all Options awarded to such Non-Employee Director may be exercised by such
Non-Employee Director, or by his or her estate, personal representative
or beneficiary, as the case may be, at any time within one year after the
date of termination of service, subject to the earlier expiration of the Option
as provided in Section 7(a). At the end of such one-year period the Option
shall expire.
(d) Exercise Following Termination of Service Subject to Company Policies
and Procedures on Insider Trading. Any exercise of an Option pursuant to
Section 7(b) or 7(c) following termination of a Non-Employee Director's
service as a member of the Board for any reason other than death shall be
subject to, and shall be permitted only to the extent such exercise complies
with, the policies and procedures of the Company concerning insider
trading that were applicable to the Non-Employee Director on the date of such
termination of service (as such policies and procedures may be amended by the
Company during the period provided in Section 7(b) or 7(c), as the case may
be, for exercise of the Option).
8. Time and Manner of Exercise
(a) Notice of Exercise. Subject to the other terms and conditions
hereof, a Non-Employee Director may exercise any Options (to the extent
vested) by giving written notice of exercise to the Company; provided,
however, that no less than 100 Option Shares may be purchased upon any exercise
of the Option unless the number of Option Shares purchased at such time is the
total number of Option Shares in respect of which an Option is then
exercisable, and provided, further, that in no event shall an Option be
exercisable for a fractional share. The date of exercise of an Option shall
be the later of (i) the date on which the Company receives such written notice
or (ii) the date on which the conditions provided in Section 8(b) are
satisfied. Notwithstanding any other provision of the Plan or of the notice of
award relating to an Option provided for in Section 9, no Option may be
exercised, whether in whole or in part, and no Option Shares will be issued
by the Company in respect of any such attempted exercise, at any time when
such exercise is prohibited by Company policy then in effect concerning
transactions by a Non-Employee Director in the Company's securities.
In the event that a Non-Employee Director gives written notice of exercise to
the Company at a time when such exercise is prohibited by such policy, the
Company in its sole discretion may disregard such notice of exercise or may
consider such notice to be delivered as of the first date that the Non-Employee
Director is permitted to exercise such Option in accordance with such
Company policy.
(b) Payment. Prior to the issuance of a certificate pursuant to
Section 8(e) hereof evidencing the Option Shares in respect of which all or a
portion of an Option shall have been exercised, a Non-Employee Director shall
have paid to the Company the exercise price for all Option Shares purchased
pursuant to the exercise of such Option. Payment shall be made on or within
twenty business days after the date of exercise, and such Option price shall be
paid (i) by personal check, bank draft or postal or express money order (such
modes of payment are collectively referred to as "cash") payable to the order
of the Company in U.S. dollars, (ii) in whole shares of Common Stock of the
Company owned by the Non-Employee Director prior to exercising the Option, or
(iii) in a combination of cash and delivery of shares of Common Stock as the
Board in its sole discretion may approve. In addition to the exercise methods
described above, a Non-Employee Director may exercise an Option through a
procedure whereby the Non-Employee Director delivers to the Company an
irrevocable notice of exercise in exchange for the Company issuing the shares
of Common Stock subject to the Option to a broker previously designated or
approved by the Company, subject to the rules and procedures as the
Administrator may determine.
(c) Stockholder Rights. A Non-Employee Director shall have no rights as a
stockholder with respect to any shares of Common Stock issuable upon exercise
of an Option until a certificate evidencing such shares shall have been issued
to the Non-Employee Director pursuant to Section 8(e), and no adjustment shall
be made for dividends or distributions or other rights in respect of any share
for which the record date is prior to the date upon which the Non-Employee
Director shall become the holder of record thereof.
(d) Limitation on Exercise. No Option shall be exercisable unless the
Common Stock subject thereto has been registered under the Securities Act and
qualified under applicable state "blue sky" laws in connection with the offer
and sale thereof, or the Company has determined that an exemption from
registration under the Securities Act and from qualification under such state
"blue sky" laws is available.
(e) Issuance of Shares. Subject to the foregoing conditions, as soon
as is reasonably practicable after its receipt of a proper notice of exercise
and payment of the Option price for the number of shares with respect to which
the Option is exercised, the Company shall deliver to the Non-Employee Director
(or following the Non-Employee Director's death, such other person entitled to
exercise the Option), at the principal office of the Company or at such other
location as may be acceptable to the Company and the Non-Employee Director
(or such other person), one or more stock certificates for the appropriate
number of shares of Common Stock issued in connection with such exercise.
Such shares shall be fully paid and nonassessable and shall be issued in the
name of the Non-Employee Director (or such other person).
(f) Tax Withholding. The Company shall have the right, prior to the
delivery of any certificates evidencing shares of Common Stock to be issued
upon full or partial exercise of an Option, to require a Non-Employee Director
to remit to the Company any amount sufficient to satisfy any Federal, state
or local tax withholding requirements. The Company may permit the Non-Employee
Director to satisfy, in whole or in part, such obligation to remit taxes, by
directing the Company to withhold shares of Common Stock that would otherwise
be received by the Non-Employee Director, pursuant to such rules as the
Committee may establish from time to time, by delivering to the Company shares
of Common Stock owned by the Non-Employee Director prior to exercising the
Option, or by making a payment to the Company consisting of a combination of
cash and such shares of Common Stock. Such an election shall be subject to
the following:
(i) the election shall be made in such manner as may be prescribed by
the Committee and the Committee shall have the right, in its discretion, to
disapprove such election; and
(ii) the election shall be made prior to the date to be used to
determine the tax to be withheld and shall be irrevocable.
The value of any share of Common Stock to be withheld by the Company or
delivered to the Company pursuant to this Section 8(f) shall be the Fair Market
Value of the Common Stock on the date to be used to determine the amount of tax
to be withheld.
The Company shall also have the right to deduct from all cash payments
made pursuant to or in connection with the Option any Federal, state or local
taxes required to be withheld with respect to such payments.
(g) Restrictions on Transfer. An Option may not be transferred,
pledged, assigned, or otherwise disposed of, except by will or by the laws of
descent and distribution or pursuant to a qualified domestic relations order as
defined in the Code or Title I of ERISA ("QDRO"). The Option shall be
exercisable, during the Non-Employee Director's lifetime, only by the Non-
Employee Director or by the person to whom the Option has been transferred
pursuant to a QDRO. No assignment or transfer of the Option, or of the rights
represented thereby, whether voluntary or involuntary, by operation of law or
otherwise, except by will or the laws of descent and distribution or pursuant to
a QDRO, shall vest in the assignee or transferee any interest or right in the
Option, but immediately upon any attempt to assign or transfer the Option the
same shall terminate and be of no force or effect.
(h) Non-qualified Status of Options. Options awarded under the Plan are
not intended to qualify, and shall not be treated, as an "incentive stock
options" within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended.
9. Notice of Award
The terms and conditions of each award of Options shall be embodied in a
certificate which shall incorporate the Plan by reference. Each certificate
shall state the date on which the Options were granted, the number of shares
subject to such Option and the per share exercise price therefor.
10. No Restriction on Right of Company to Effect Corporate Changes
(a) Authority of the Company and Stockholders. The existence of the
Plan, any award certificates and the Options granted hereunder shall not
affect or restrict in any way the right or power of the Company or the
stockholders of the Company to make or authorize any adjustment,
recapitalization, reorganization or other change in the Company's capital
structure or its business, any merger or consolidation of the Company, any
issue of stock or of options, warrants or rights to purchase stock or of
bonds, debentures, preferred or prior preference stocks whose rights are
superior to or affect the Common Stock or the rights thereof or which are
convertible into or exchangeable for Common Stock, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise.
(b) Change in Capitalization. Notwithstanding any provision of the
Plan or any award certificates, the number and kind of shares authorized for
issuance under Section 3(a) may be equitably adjusted in the sole discretion of
the Committee in the event of a stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, extraordinary dividend, split-up, spin-
off, combination, exchange of shares, warrants or rights offering to purchase
Common Stock at a price substantially below Fair Market Value or other similar
corporate event affecting the Common Stock in order to preserve, but not
increase, the benefits or potential benefits intended to be made available
under the Plan. In addition, upon the occurrence of any of the foregoing
events, the number of outstanding Options and the number and kind of shares
subject to any outstanding Option and the purchase price per share, if any,
under any outstanding Option may be equitably adjusted (including by payment
of cash to a Non-Employee Director) in the sole discretion of the
Committee in order to preserve the benefits or potential benefits intended to
be made available to Non-Employee Directors granted Options. Such adjustments
shall be made by the Committee, in its sole discretion, whose determination as
to what adjustments shall be made, and the extent thereof, shall be final.
Unless otherwise determined by the Committee, such adjusted Options shall
be subject to the same vesting schedule and restrictions to which the
underlying Option is subject.
11. Effective Date; Term of the Plan
Subject to approval by the majority of the shareholders of the Company at
the 1998 Annual Meeting, the effective date of the Plan shall be January 1,
1998. If the Plan is not approved by the stockholders at such Annual Meeting,
the Plan and all interests in the Plan awarded to Non-Employee Directors
before the date of such Annual Meeting shall be void ab initio and of no further
force and effect. Unless terminated earlier in accordance with Section
12 below, the Plan shall terminate on the Annual Meeting of shareholders of the
Company in 2003. After such date, no further awards of Options may be made
hereunder, but previously granted awards shall remain outstanding subject to the
terms hereof.
12. Amendments; Termination
The Board may at any time and from time to time alter, amend, suspend
or terminate the Plan in whole or in part, provided, however, that in no
event may the provisions of the Plan respecting eligibility to participate or
the timing or amount of awards be amended more frequently than once every six
months, other than to comply with changes in the Code, ERISA or any rules or
regulations thereunder. Any amendment to the Plan, which under the requirements
of applicable law must be approved by the stockholders of the Company, shall
not be effective unless and until such stockholder approval has been obtained in
compliance with such law. Any amendment to the Plan that must be approved by
the stockholders of the Company in order to maintain the continued qualification
of the Plan under Rule 16b-3 under the Exchange Act, or any successor
provision, shall not be effective unless and until such stockholder approval
has been obtained in compliance with such rule. No termination or amendment of
the Plan may, without the written consent of the Non-Employee Director, affect
any such person's rights under the provisions of the Plan with respect to awards
of Options which were made prior to such action.
13. No Right to Reelection
Nothing in the Plan shall be deemed to create any obligation on the part of
the Board to nominate any of its members for reelection by the Company's
stockholders, nor confer upon any Non-Employee Director the right to remain a
member of the Board for any period of time, or at any particular rate of
compensation.
14. Governing Law
The Plan and all award documents issued shall be construed in accordance
with and governed by the laws of the state of New York.