Exhibit 4.3a
TIFFANY & CO.
2008 DIRECTORS EQUITY COMPENSATION PLAN
Section 1
General
1.1 Purpose. The Tiffany & Co. 2008 Directors Equity Compensation Plan (the
"Plan") has been established by Tiffany & Co., a Delaware corporation, (the
"Company") to advance the interests of the Company by enabling the Company to
attract, retain and motivate qualified individuals to serve on the Company's
Board of Directors and to further link Participants' interests with those of the
Company's stockholders through compensation that is based on the Company's
Common Stock, thereby promoting the long-term financial interests of the Company
and its Related Companies, including the growth in value of the Company's
stockholders' equity and the enhancement of long-term returns to the Company's
stockholders.
1.2 Participation. Subject to the terms and conditions of the Plan, the
Committee shall, from time to time, determine and designate from among Eligible
Individuals those persons who will be granted one or more Awards under the Plan.
Eligible Individuals who are granted Awards become "Participants" in the Plan.
At the discretion of the Committee, a Participant may be granted any Award
permitted under the provisions of the Plan, and more than one Award may be
granted to a Participant. Awards need not be identical but shall be subject to
the terms and conditions specified in the Plan. Subject to the last two
sentences of subsection 2.2 of the Plan, Awards may be granted as alternatives
to or in replacement for awards outstanding under the Plan, or any other plan or
arrangement of the Company.
1.3 Operation, Administration, and Definitions. The operation and
administration of the Plan, including the Awards made under the Plan, shall be
subject to the provisions of Section 4 (relating to operation and
administration). Initially capitalized terms used in the Plan shall be defined
as set forth in the Plan (including in the definitional provisions of Section 7
of the Plan).
1.4 Prior Plan. This Plan is intended to become effective on approval by
the Company's stockholders, as provided for in Section 4.1 below. This Plan is
intended to replace the Company's 1998 Directors Option Plan approved by the
Company's stockholders on May 21, 1998 (the "Prior Plan"). In accordance with
the terms of the Prior Plan: (i) no Award may be granted or otherwise made under
the Prior Plan after May 21, 2008, but (ii) the Prior Plan shall remain in
effect as long as any awards under the Prior Plan are outstanding. Shares
subject to the Prior Plan which are not subject to outstanding awards under the
Prior Plan as of the Effective Date of this Plan (see subsection 4.1 of this
Plan) and which have not been delivered to participants under the Prior Plan as
of such Effective Date may not be awarded under the Prior Plan on or after such
Effective Date and the Prior Plan shall be deemed amended accordingly on such
Effective Date. Shares subject to the Prior Plan, as described in the preceding
sentence, shall not be deemed transferred to this Plan.
Section 2
Options
2.1 Definition. The grant of an "Option" entitles the Participant to
purchase Shares at an Exercise Price established by the Committee. Options
granted under this Section 2 shall be Non-Qualified Options. A "Non-Qualified
Option" is an Option that is not intended to be an "incentive stock option" as
that term is described in section 422(b) of the Code.
2008 Directors Equity Compensation Plan Page 1
May 15, 2008
2.2 Exercise Price. The per-share "Exercise Price" of each Option granted
under this Section 2 shall be established by the Committee or shall be
determined by a formula established by the Committee at or prior to the time the
Option is granted; except that the Exercise Price shall not be less than 100% of
the Fair Market Value of a Share as of the Pricing Date unless the Participant
has agreed to forgo all or a portion of his or her annual cash retainer or other
fees for service as a director of the Company in exchange for the Option, in
which case the difference between (a) the aggregate Fair Market Value of the
Shares subject to the Option as of the Pricing Date and (b) the aggregate
Exercise Price for the Shares subject to the Option shall be equal to the amount
of the cash retainer or other such fees agreed to be forgone by the Participant.
For purposes of the preceding sentence, the "Pricing Date" shall be the date on
which the Option is granted unless the Option is granted on a date on which the
principal exchange on which the Stock is then listed or admitted to trading is
closed for trading, in which case the "Pricing Date" shall be the most recent
date on which such exchange was open for trading prior to such grant date.
Except as provided in subsection 4.2(c), the Exercise Price of any Option may
not be decreased after the grant of the Award. An Option may not be surrendered
as consideration in exchange for a new Award with a lower Exercise Price.
2.3 Exercise. Options shall be exercisable in accordance with such terms
and conditions and during such periods as may be established by the Committee
provided that no Option shall be exercisable after, and each Option shall become
void no later than, the tenth (10th ) anniversary of the date of the grant of
such option.
2.4 Payment of Option Exercise Price. The payment of the Exercise Price of
an Option granted under this Section 2 shall be subject to the following:
(a) The Exercise Price may be paid by ordinary check or such other form of
tender as the Committee may specify.
(b) If permitted by the Committee, the Exercise Price for Shares purchased
upon the exercise of an Option may be paid in part or in full by
tendering Shares (by either actual delivery of shares or by
attestation, with such shares valued at Fair Market Value as of the
date of exercise). The Committee may refuse to accept payment in
Shares if such payment would result in an accounting charge to the
Company.
(c) The Committee may permit a Participant to elect to pay the Exercise
Price upon the exercise of an Option by irrevocably authorizing a
third party to sell Shares acquired upon exercise of the Option (or a
sufficient portion of such shares) and remit to the Company a
sufficient portion of the sale proceeds to pay the entire Exercise
Price and any tax withholding resulting from such exercise.
Section 3
Stock Awards
3.1 Definition. A "Stock Award" is a grant of Shares or of a right to
receive Shares.
3.2 Restrictions on Stock Awards. Each Stock Award shall be subject to such
conditions, restrictions and contingencies, if any, as the Committee shall
determine.
2008 Directors Equity Compensation Plan Page 2
May 15, 2008
Section 4
Operation and Administration
4.1 Effective Date and Duration. Subject to approval of the stockholders of
the Company at the Company's 2008 annual meeting, the Plan shall be effective as
of the date of such approval (the "Effective Date") and shall remain in effect
as long as any Awards under the Plan are outstanding; provided, however, that no
Award may be granted or otherwise made under the Plan on a date that is more
than ten (10) years from the Effective Date.
4.2 Shares Subject to Plan.
(a) (i) Subject to the following provisions of this subsection 4.2, the
maximum aggregate number of Shares that may be delivered to
Participants and their beneficiaries under the Plan shall be One
Million (1,000,000) Shares, provided that such maximum shall be
reduced by one and 58 hundredths (1.58) of a Share for each Share that
is delivered pursuant to a Stock Award. Shares issued under the Plan
may be authorized and unissued Shares or Shares reacquired by the
Company.
(ii) Any Shares granted under the Plan that are forfeited because of
the failure to meet a Stock Award contingency or condition shall again
be available for delivery pursuant to new Awards granted under the
Plan. To the extent any Shares covered by an Award are not delivered
to a Participant or a Participant's beneficiary because the Award is
forfeited or canceled, such shares shall not be deemed to have been
delivered for purposes of determining the maximum number of Shares
available for delivery under the Plan.
(iii) If the Exercise Price and/or tax withholding obligation for any
Option or Award granted under the Plan is satisfied by tendering
Shares to the Company (by either actual delivery or attestation) or by
the Company withholding Shares, the number of Shares issued on such
exercise or Award without offset for the number of Shares so tendered
shall be deemed delivered for purposes of determining the maximum
number of Shares available for delivery under the Plan; if the
Exercise Price and/or tax withholding obligation for any Option or
Award granted under the Plan is satisfied by the Company withholding
Shares, the full number of Shares for which such Option was exercised
or such Award was granted, without reduction for the number of Shares
withheld, shall be deemed delivered for purposes of determining the
maximum number of Shares available for delivery under the Plan.
(b) Subject to adjustment under paragraph 4.2(c), the following additional
limitation is imposed under the Plan: the maximum aggregate number of
Shares that may be awarded to any one Participant in any single fiscal
year of the Company, either as Shares subject to Options, Stock Awards
or any combination of Options and Stock Awards shall be Twenty-five
Thousand (25,000) Shares.
(c) If the outstanding Shares are increased or decreased, or are changed
into or exchanged for cash, property, or a different number or kind of
shares or securities, or if cash, property or Shares or other
securities are distributed in respect of such outstanding Shares, in
either case as a result of one or more mergers, reorganizations,
reclassifications, recapitalizations, stock splits, reverse stock
splits, stock dividends, dividends (other than regular, quarterly
dividends), or other distributions, spin-offs or the like, or if
2008 Directors Equity Compensation Plan Page 3
May 15, 2008
substantially all of the property and assets of the Company are sold,
then, unless the terms of the transaction shall provide otherwise,
appropriate adjustments shall be made in the number and/or type of
shares or securities for which Awards may thereafter be granted under
the Plan and for which Awards then outstanding under the Plan may
thereafter be exercised. Any such adjustments in outstanding Awards
shall be made without changing the aggregate Exercise Price applicable
to the unexercised portions of outstanding Options. The Committee
shall make such adjustments to preserve the benefits or potential
benefits of the Plan and the Awards; such adjustments may include, but
shall not be limited to, adjustment of: (i) the number and kind of
shares which may be delivered under the Plan; (ii) the number and kind
of shares subject to outstanding Awards; (iii) the Exercise Price of
outstanding Options; (iv) the limit specified in subsection 4.2(b)
above; and (v) any other adjustments that the Committee determines to
be equitable. No right to purchase or receive fractional shares shall
result from any adjustment in Options or Stock Awards pursuant to this
paragraph 4.2(c). In case of any such adjustment, Shares subject to
the Option or Stock Award shall be rounded up to the nearest whole
Share.
4.3 Limit on Distribution. Distribution of Shares or other amounts under
the Plan shall be subject to the following:
(a) Notwithstanding any other provision of the Plan, the Company shall
have no obligation to deliver any Shares under the Plan or make any
other distribution of benefits under the Plan unless such delivery or
distribution would comply with all applicable laws (including, without
limitation, the requirements of the Securities Act of 1933) and the
applicable requirements of any securities exchange or similar entity
and the Committee may impose such restrictions on any Shares acquired
pursuant to the Plan as the Committee may deem advisable, including,
without limitation, restrictions under applicable federal securities
laws, under the requirements of any stock exchange or market upon
which such Shares are then listed and/or traded, and under any blue
sky or state securities laws applicable to such Shares. In the event
that the Committee determines in its discretion that the registration,
listing or qualification of the Shares issuable under the Plan on any
securities exchange or under any applicable law or governmental
regulation is necessary as a condition to the issuance of such Shares
under an Option or Stock Award, such Option or Stock Award shall not
be exercisable or exercised in whole or in part unless such
registration, listing and qualification, and any necessary consents or
approvals have been unconditionally obtained.
(b) Distribution of Shares under the Plan may be effected on a
non-certificated basis, to the extent not prohibited by applicable law
or the applicable rules of any stock exchange.
4.4 Tax Withholding. Before distribution of Shares under the Plan, the
Company may require the recipient to remit to the Company an amount sufficient
to satisfy any federal, state or local tax withholding requirements or, if
agreed by the Committee, the Company may withhold from the Shares to be
delivered and/or otherwise issued Shares sufficient to satisfy all or a portion
of such tax withholding requirements. Whenever under the Plan payments are to be
made in cash, such payments shall be in an amount sufficient to satisfy any
federal, state or local tax withholding requirements as well as the amount of
the cash payment otherwise required. Neither the Company nor any Related Company
shall be liable to a Participant or any other person as to any tax consequence
expected, but not realized, by any Participant or other person due to the
receipt or exercise of any Award hereunder.
2008 Directors Equity Compensation Plan Page 4
May 15, 2008
4.5 Reserved Rights. Subject to the limitations of subsection 4.2 on the
number of Shares that may be delivered under the Plan, the Plan does not limit
the right of the Company to use available Shares, including authorized but
un-issued Shares and treasury Shares, as the form of payment for compensation,
grants or rights earned or due under any other compensation plans or
arrangements of the Company or a Related Company, including the plans or
arrangements of the Company or a Related Company, including the plans or
arrangements of the Company or a Related Company acquiring another entity (or an
interest in another entity). The Committee may provide in the Award Agreement
that the Shares to be issued upon exercise of an Option or receipt of a Stock
Award shall be subject to such further conditions, restrictions or agreements as
the Committee in its discretion may specify, including without limitation,
conditions on vesting or transferability, and forfeiture and repurchase
provisions.
4.6 Dividends and Dividend Equivalents. An Award may provide the
Participant with the right to receive dividends or dividend equivalent payments
with respect to Shares which may be paid currently or credited to an account for
the Participant, and which may be settled in cash or Shares as determined by the
Committee. Any such settlements, and any such crediting of dividends or dividend
equivalents or reinvestment in Shares may be subject to such conditions,
restrictions and contingencies as the Committee shall establish, including
reinvestment of such credited amounts in Stock equivalents.
4.7 Settlements; Deferred Delivery. Awards may be settled through cash
payments, the delivery of Shares, the granting of replacement Awards, or
combinations thereof, all subject to such conditions, restrictions and
contingencies as the Committee shall determine. The Committee may establish
provisions for the deferred delivery of Shares upon the exercise of an Option or
receipt of a Stock Award with the deferral evidenced by use of Stock Units equal
in number to the number of Shares whose delivery is so deferred. A "Stock Unit"
is a bookkeeping entry representing an amount equivalent to the Fair Market
Value of one Share. Stock Units represent an unfunded and unsecured obligation
of the Company except as otherwise provided by the Committee. Settlement of
Stock Units upon expiration of the deferral period shall be made in Shares or
otherwise as determined by the Committee. The amount of Shares, or other
settlement medium, to be so distributed may be increased by an interest factor
or by dividend equivalents. Until a Stock Unit is settled, the number of Shares
represented by a Stock Unit shall be subject to adjustment pursuant to paragraph
4.2(c). Unless otherwise specified by the Committee, any deferred delivery of
Shares pursuant to an Award shall be settled by the delivery of Shares no later
than the 60th day following the date the person to whom such deferred delivery
must be made ceases to be a director of the Company.
4.8 Transferability. Unless otherwise provided by the Committee, any Option
granted under the Plan, and, until vested, any Stock Award granted under the
Plan, shall by its terms be nontransferable by the Participant otherwise than by
will, the laws of descent and distribution, and shall be exercisable by, or
become vested in, during the Participant's lifetime, only the Participant.
4.9 Form and Time of Elections. Unless otherwise specified herein, each
election required or permitted to be made by any Participant or other person
entitled to benefits under the Plan, and any permitted modification, or
revocation thereof, shall be in writing filed with the secretary of the Company
at such times, in such form, and subject to such restrictions and limitations,
not inconsistent with the terms of the Plan, as the Committee shall require.
4.10 Award Agreements with Company; Vesting and Acceleration of Vesting of
Awards. At the time of an Award to a Participant, the Committee may require the
Participant to enter into an agreement with the Company (an "Award Agreement")
in a form specified by the Committee, agreeing to the terms and conditions of
the Plan and to such additional terms and conditions, not inconsistent with the
Plan, as the Committee may, in its sole discretion, prescribe, including, but
not limited to, conditions to the vesting or exercise of an Award, such as
continued service as a director of the Company for a specified period of time.
The Committee may waive such conditions to and/or accelerate exercisability or
vesting of an Option or Stock Award, either automatically upon the occurrence of
specified events (including in connection with a change of control of the
Company) or otherwise in its discretion.
2008 Directors Equity Compensation Plan Page 5
May 15, 2008
4.11 Limitation of Implied Rights.
(a) Neither a Participant nor any other person shall, by reason of the
Plan or any Award Agreement, acquire any right in or title to any
assets, funds or property of the Company or any Related Company
whatsoever, including, without limitation, any specific funds, assets,
or other property which the Company or any Related Company, in their
sole discretion, may set aside in anticipation of a liability under
the Plan. A Participant shall have only a contractual right to the
Shares or amounts, if any, payable under the Plan, unsecured by the
assets of the Company or of any Related Company. Nothing contained in
the Plan or any Award Agreement shall constitute a guarantee that the
assets of such companies shall be sufficient to pay any benefits to
any person.
(b) Neither the Plan nor any Award Agreement shall constitute a contract
of employment, and selection as a Participant will not confer upon any
Participant any right to serve as a director of the Company, nor any
right or claim to any benefit under the Plan, unless such right or
claim has specifically accrued under the terms of the Plan or an
Award. Except as otherwise provided in the Plan, no Award under the
Plan shall confer upon the holder thereof any right as a stockholder
of the Company prior to the date on which the individual fulfills all
conditions for receipt of such rights.
4.12 Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which an officer of the
Company acting on it considers pertinent and reliable, and signed, made or
presented by the proper party or parties.
4.13 Action by Company. Any action required or permitted to be taken by the
Company shall be by resolution of the Board, or by action of one or more members
of such Board (including a committee of such board) who are duly authorized to
act for such Board, or (except to the extent prohibited by applicable law or
applicable rules of any stock exchange) by a duly authorized officer of the
Company.
4.14 Gender and Number. Where the context admits, words in any gender shall
include any other gender, words in the singular shall include the plural and the
plural shall include the singular.
4.15 Non-exclusivity of the Plan. Neither the adoption of the Plan by the
Board of Directors of the Company nor the submission of the Plan to the
stockholders of the Company for approval shall be construed as creating any
limitations on the power of such Board of Directors or a committee of such Board
to adopt such other incentive arrangements as it or they may deem desirable,
including without limitation, the granting of restricted stock, stock options or
cash bonuses otherwise than under the Plan, and such arrangements may be
generally applicable or applicable only in specific cases.
Section 5
Committee
5.1 Administration. The authority to control and manage the operation and
administration of the Plan shall be vested in the Board and/or a committee of
the Board (either the Board or such committee the "Committee" hereunder) in
accordance with this Section 5.
2008 Directors Equity Compensation Plan Page 6
May 15, 2008
5.2 Selection of Committee. If consisting of less than the full
membership of the Board, the Committee shall be selected by the Board and shall
consist of two or more members of the Board.
5.3 Powers of Committee. The authority to manage and control the operation
and administration of the Plan shall be vested in the Committee, subject to the
following:
(a) Subject to the provisions of the Plan, the Committee will have the
authority and discretion to select from amongst Eligible Individuals
those persons who shall receive Awards, to determine who is an
Eligible Individual, to determine the time or times of receipt, to
determine the types of Awards and the number of Shares covered by the
Awards, to establish the terms, conditions, restrictions, and other
provisions of such Awards and Award Agreements, and (subject to the
restrictions imposed by Section 6) to cancel, amend or suspend Awards.
In making such Award determinations, the Committee may take into
account such factors as the Committee deems relevant.
(b) The Committee will have the authority and discretion to establish
terms and conditions of Awards as the Committee determines to be
necessary or appropriate to conform to applicable requirements or
practices of jurisdictions outside the United States.
(c) The Committee will have the authority and discretion to interpret the
Plan, to establish, amend and rescind any rules and regulations
relating to the Plan, to determine the terms and provisions of any
Award Agreements, and to make all other determinations that may be
necessary or advisable for the administration of the Plan.
(d) Interpretations of the Plan by the Committee and decisions made by the
Committee under the Plan are final and binding.
(e) In controlling and managing the operation and administration of the
Plan, the Committee shall act by a majority of its then members, by
meeting or by writing filed without a meeting. The Committee shall
maintain adequate records concerning the Plan and concerning its
proceedings and acts in such form and detail as the Committee may
decide.
5.4 Delegation by Committee. Except to the extent prohibited by applicable
law or the applicable rules of a stock exchange, the Committee may allocate all
or any portion of its powers and responsibilities to any one or more of its
members and may delegate all or part of its responsibilities and powers to any
person or persons selected by it. Any such allocation or delegation may be
revoked by the Committee at any time.
5.5 Information to be furnished to Committee. The Company shall furnish the
Committee with such data and information as may be requested by the Committee to
discharge its duties. The records of the Company as to an Eligible Individual's
or a Participant's service as a director shall be conclusive on all persons
unless determined to be incorrect by the Committee. Participants and other
persons entitled to benefits under the Plan must furnish the Committee such
evidence, data or information as the Committee considers necessary or desirable
to carry out the terms of the Plan.
2008 Directors Equity Compensation Plan Page 7
May 15, 2008
Section 6
Amendment and Termination
6.1 Board's Right to Amend or Terminate. Subject to the limitations set
forth in this Section 6, the Board may, at any time, amend or terminate the
Plan.
6.2 Amendments Requiring Stockholder Approval. Other than as provided in
subsection 4.2 (c) (relating to certain adjustments to Shares), the approval of
the Company's stockholders shall be required for any amendment which: (i)
increases the maximum number of Shares that may be delivered to Participants
under the Plan set forth in subsection 4.2(a); (ii) increases the maximum
limitation contained in Section 4.2(b); (iii) decreases the Exercise Price of
any Option below the minimum provided in subsection 2.2; (iv) modifies or
eliminates the prohibitions stated in the final two sentences of subsection 2.2;
or (v) increases the maximum term of any Option set forth in Section 2.3.
Whenever the approval of the Company's stockholders is required pursuant to this
subsection 6.2, such approval shall be sufficient if obtained by a majority vote
of those stockholders present or represented and actually voting on the matter
at a meeting of stockholders duly called, at which meeting a majority of the
outstanding shares actually vote on such matter.
6.3 Consent of Affected Participants. No amendment to or termination of the
Plan shall, in the absence of written consent to the change by the affected
Participant (or, if the Participant is not then living or if the Award has been
transferred pursuant to a right of transfer contained in an Award Agreement, the
affected beneficiary or affected transferee, as the case may be), adversely
affect the rights of any Participant, beneficiary or permitted transferee under
any Award granted under the Plan prior to the date such amendment or termination
is adopted by the Board.
Section 7
Defined Terms
For the purposes of the Plan, the terms listed below shall be defined as
follows:
Award. The term "Award" shall mean, individually and collectively, any award or
benefit granted to any Participant under the Plan, including, without
limitation, the grant of Options and Stock Awards.
Award Agreement. The term "Award Agreement" is defined in subsection 4.10.
Board. The term "Board" shall mean the Board of Directors of the Company.
Code. The term "Code" shall mean the Internal Revenue Code of 1986, as amended.
A reference to any provision of the Code shall include reference to any
successor provision of the Code or of any law that is enacted to replace the
Code.
Eligible Individual. The term "Eligible Individual" shall mean a Non-Employee
Director. The term "Non-Employee Director" means a member of the Board who is
not at the time of an Award also an employee of the Company or a Related
Company.
Fair Market Value. For purposes of determining the "Fair Market Value" of a
share of Stock, the following rules shall apply:
2008 Directors Equity Compensation Plan Page 8
May 15, 2008
(i) If the Stock is at the time listed or admitted to trading on any
stock exchange, then the Fair Market Value shall be the higher of (a)
the simple arithmetic mean of the lowest and the highest reported
sales prices of the Stock on the date in question on the principal
exchange on which the Stock is then listed or admitted to trading and
(b) the closing price on such exchange on such date. If no reported
sale of Stock takes place on the date in question on the principal
exchange, then the reported closing asked price of the Stock on such
date on the principal exchange shall be determinative of Fair Market
Value.
(ii) If the Stock is not at the time listed or admitted to trading on
a stock exchange, the Fair Market Value shall be the mean between the
lowest reported bid price and the highest reported asked price of the
Stock on the date in question in the over-the-counter market, as such
prices are reported in a publication of general circulation selected
by the Committee and regularly reporting the market price of the Stock
in such market.
(iii) If the Stock is not listed or admitted to trading on any stock
exchange or traded in the over-the-counter market, the Fair Market
Value shall be as determined by the Committee, acting in good faith.
Related Companies. The term "Related Company" means:
(i) any corporation, partnership, joint venture or other entity during
any period in which such corporation, partnership, joint venture or
other entity owns, directly or indirectly, at least fifty percent
(50%) of the voting power of all classes of voting stock of the
Company (or any corporation, partnership, joint venture or other
entity which is a successor to the Company);
(ii) any corporation, partnership, joint venture or other entity
during any period in which the Company (or any corporation,
partnership, joint venture or other entity which is a successor to the
Company or any entity that is a Related Company by reason of clause
(i) next above) owns, directly or indirectly, at least a fifty percent
(50%) voting or profits interest; or
(iii) any business venture in which the Company has a significant
interest, as determined at the discretion of the Committee.
Shares. The term "Shares" shall mean shares of the Common Stock of the Company,
$.01 par value, as presently constituted, subject to adjustment as provided in
paragraph 4.2(c) above.
Section 8
Successors
All obligations of the Company under the Plan with respect to Awards shall
be binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger, consolidation
or otherwise, of all or substantially all of the business and/or assets of the
Company.
2008 Directors Equity Compensation Plan Page 9
May 15, 2008