EXHIBIT 10.A.5
APPLE COMPUTER, INC.
1990 STOCK OPTION PLAN
1. Purposes of the Plan. The purposes of this 1990 Stock Option
Plan are to attract and retain high quality personnel for positions of
substantial responsibility, to provide additional incentive to Employees of
the Company, its Subsidiaries and its Affiliated Companies and to promote
the success of the Company's business. This Plan succeeds to and replaces
the Company's 1981 Stock Option Plan. Options granted under the Plan may
be incentive stock options (as defined under Section 422 of the Code) or
non-statutory stock options, as determined by the Administrator at the time
of grant of an option and subject to the applicable provisions of Section
422 of the Code, and the regulations promulgated thereunder. Stock
appreciation rights ("SARs") may be granted under the Plan in connection
with Options or independently of Options.
2. Definitions. As used herein, the following definitions shall
apply:
(a) "Administrator" means the Board or any of its Committees, as
shall be administering the Plan from time to time pursuant to Section 4 of
the Plan.
(b) "Affiliated Company" means a corporation which is not a
Subsidiary but with respect to which the Company owns, directly or
indirectly through one or more Subsidiaries, at least 20% of the total
voting power, unless the Administrator determines in its discretion that
such corporation is not an Affiliated Company.
(c) "Board" means the Board of Directors of the Company.
(d) "Common Stock" means the Common Stock, no par value, of the
Company.
(e) "Company" means Apple Computer, Inc., a California corporation,
or its successor.
(f) "Committee" means a Committee, if any, appointed by the Board in
accordance with paragraph (a) of Section 4 of the Plan.
(g) "Code" means the Internal Revenue Code of 1986, as amended from
time to time, and any successor thereto.
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(h) "Continuous Status as an Employee" means the absence of any
interruption or termination of the employment relationship with the Company
or any Subsidiary or Affiliated Company. Continuous Status as an Employee
shall not be considered interrupted in the case of: (i) medical leave,
provided that such leave is for a period of not more than four months; (ii)
military leave; (iii) family leave, provided that such leave is for a
period of not more than four months; (iv) any other leave of absence
approved by the Administrator, provided that such leave is for a period of
not more than four months, unless reemployment upon the expiration of such
leave is guaranteed by contract or statute, or unless provided otherwise
pursuant to formal policy adopted from time to time by the Company and
issued and promulgated to Employees in writing; or (v) in the case of
transfers between locations of the Company or between the Company, its
Subsidiaries,its successor or its Affiliated Companies.
(i) "Director" means a member of the Board.
(j) "Employee" means any person, including Officers and Directors,
employed by and on the payroll of the Company, any Subsidiary or any
Affiliated Company. The payment of Directors' fees by the Company shall
not be sufficient to constitute "employment" by the Company.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(l) "Fair Market Value" means the value of Common Stock determined as
follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system (including without limitation the
National Market System of the National Association of Securities
Dealers, Inc. Automated Quotation ("NASDAQ") System), its Fair Market
Value shall be the closing sales price for such stock or the closing
bid if no sales were reported, as quoted on such system or exchange
(or the exchange with the greatest volume of trading in Common Stock)
for the last market trading day prior to the time of determination, as
reported in the Wall Street Journal or such other source as the
Administrator deems reliable.
(ii) If the Common Stock is regularly quoted on the NASDAQ System
(but not on the National Market System) or quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market
Value shall be the mean between the high and low asked prices for the
Common Stock for the last day on which there are quoted prices prior
to the time of determination.
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith
by the Administrator.
(m) "Officer" means an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder.
(n) "Nonstatutory Stock Option" means an Option that is not an
Incentive Stock Option.
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(o) "Incentive Stock Option" means an Option that satisfies the
provisions of Section 422 of the Code and is expressly designated by the
Administrator at the time of grant as an incentive stock option.
(p) "Option" means an Option granted pursuant to the Plan.
(q) "Optioned Stock" means the Common Stock subject to an Option or
SAR.
(r) "Optionee" means an Employee who receives an Option or SAR.
(s) "Parent" corporation shall have the meaning defined in Section
424(e) of the Code.
(t) "Plan" means this 1990 Stock Option Plan.
(u) "SAR" means a stock appreciation right granted pursuant to
Section 9 below.
(v) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 12 of the Plan.
(w) "Subsidiary" corporation has the meaning defined in Section
424(f) of the Code.
In addition, the terms "Rule 16b-3" and "Applicable Laws", the term
"Insiders", the term "Tax Date" and the terms "Change in Control" and
"Change in Control Price", shall have the meanings set forth, respectively,
in Sections 4, 9, 10 and 12 below.
3. Stock Subject to the Plan. Subject to the provisions of Section
12 of the Plan, the maximum aggregate number of Shares which may be
optioned and sold under the Plan or for which SARs may be granted and
exercised is 51,200,000 Shares (including Shares issued under the 1981
Stock Option Plan, to which this Plan is a successor).
The Shares may be authorized but unissued or reacquired Common Stock.
In the discretion of the Administrator, any or all of the Shares
authorized under the Plan may be subject to SARs issued pursuant to the
Plan.
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If an Option or SAR issued under this Plan or under the Company's 1981
Stock Option Plan should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were
subject thereto shall, unless this Plan shall have been terminated, become
available for other Options or SARs under this Plan. However, should the
Company reacquire Shares which were issued pursuant to the exercise of an
Option or SAR, such Shares shall not become available for future grant
under the Plan.
4. Administration of the Plan.
(a) Composition of Administrator.
(1) Multiple Administrative Bodies. If permitted by
Rule 16b-3 promulgated under the Exchange Act or any successor rule
thereto, as in effect at the time that discretion is being exercised with
respect to the Plan ("Rule 16b-3"), and by the legal requirements relating
to the administration of stock plans such as the Plan, if any, of
applicable securities laws, California corporate law and the Code
(collectively, "Applicable Laws"), the Plan may (but need not) be
administered by different administrative bodies with respect to (A)
Directors who are not Employees, (B) Directors who are Employees, (C)
Officers who are not Directors and (D) Employees who are neither Directors
nor Officers.
(2) Administration with respect to Directors and
Officers. With respect to grants and awards to Employees who are also
Officers or Directors of the Company, the Plan may be administered by (A)
the Board, if the Board may administer the Plan in compliance with Rule 16b-
3 as it applies to a plan intended to qualify thereunder as a discretionary
grant or award plan, or (B) a Committee designated by the Board to
administer the Plan, which Committee shall be constituted (I) in such a
manner as to permit the Plan and grants and awards thereunder to comply
with Rule 16b-3 as it applies to a plan intended to qualify thereunder as a
discretionary grant or award plan and (II) in such a manner as to satisfy
the Applicable Laws.
(3) Administration with respect to Other Persons.
With respect to grants and awards to Employees who are neither Directors
nor Officers of the Company, the Plan may be administered by (A) the Board
or (B) a Committee designated by the Board, which Committee shall be
constituted in such a manner as to satisfy the Applicable Laws.
(4) General. Once a Committee has been appointed
pursuant to subsection (2) or (3) of this Section 4(a), such Committee
shall continue to serve in its designated capacity until otherwise directed
by the Board. From time to time the Board may increase the size of any
Committee and appoint additional members thereof, remove members (with or
without cause) and appoint new members in substitution therefor, fill
vacancies (however caused) and remove all members of a Committee and
thereafter directly administer the Plan, all to the extent permitted by the
Applicable Laws and, in the case of a Committee appointed under subsection
(2) to the extent permitted by Rule 16b-3 as it applies to a plan intended
to qualify thereunder as a discretionary grant or award plan.
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(b) Powers of the Administrator. Subject to the provisions of
the Plan and, in the case of a Committee, subject to the specific duties
delegated by the Board to such Committee, the Administrator shall have the
authority, in its discretion: (i) to determine the Fair Market Value of the
Common Stock in accordance with Section 2(l) of the Plan; (ii) to
determine, in accordance with Section 8(a) of the Plan, the exercise price
per Share of Options and SARs to be granted; (iii) to determine the
Employees to whom, and the time or times at which, Options and SARs shall
be granted and the number of Shares to be represented by each Option or SAR
(including without limitation whether or not a corporation shall be
excluded from the definition of Affiliated Company under Section 2(b));
(iv) to interpret the Plan; (v) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any Option or SAR granted
hereunder (including, but not limited to, any restriction or limitation, or
any vesting acceleration or waiver of forfeiture restrictions regarding any
Option or SAR and/or the Shares relating thereto, based in each case on
such factors as the Administrator shall determine, in its sole discretion);
(vi) to approve forms of agreement for use under the Plan; (vii) to
prescribe, amend and rescind rules and regulations relating to the Plan;
(viii) to modify or amend each Option or SAR (with the consent of the
Optionee) or accelerate the exercise date of any Option or SAR; (ix) to
reduce the exercise price of any Option or SAR to the then current Fair
Market Value if the Fair Market Value of the Common Stock covered by such
Option or SAR shall have declined since the date the Option or SAR was
granted; (x) to authorize any person to execute on behalf of the Company
any instrument required to effectuate the grant of an Option or SAR
previously granted by the Administrator; and (xi) to make all other
determinations deemed necessary or advisable for the administration of the
Plan.
(c) Effect of Decisions by the Administrator. All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees and any other holders of any Options.
5. Eligibility. Options and SARs may be granted only to Employees.
An Employee who has been granted an Option or SAR may, if he or she is
otherwise eligible, be granted an additional Option or Options, SAR or
SARs. Each Option shall be evidenced by a written Option agreement, which
shall expressly identify the Options as Incentive Stock Options or as
Nonstatutory Stock Options, and which shall be in such form and contain
such provisions as the Administrator shall from time to time deem
appropriate. However, notwithstanding such designation, to the extent that
the aggregate Fair Market Value of the Shares with respect to which Options
designated as Incentive Stock Options and options granted under other plans
of the Company or any Parent or Subsidiary that are designated as incentive
stock options are exercisable for the first time by an Optionee during any
calendar year exceeds $100,000, such excess Options shall be treated as
Nonstatutory Stock Options. For purposes of the preceding sentence, (i)
Options shall be taken into account in the order in which they were
granted, and (ii) the Fair Market Value of the Shares shall be determined
as of the time the Option or other incentive stock option with respect to
such Shares is granted. Without limiting the foregoing, the Administrator
may, at any time, or from time to time, authorize the Company, with the
consent of the respective recipients, to issue new Options or Options in
exchange for the surrender and cancellation of any or all outstanding
Options, other options, SARs or other stock appreciation rights.
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Neither the Plan nor any Option or SAR agreement shall confer upon any
Optionee any right with respect to continuation of employment by the
Company (or any Parent, Subsidiary or Affiliated Company), nor shall it
interfere in any way with the Optionee's right or the right of the Company
(or any Parent, Subsidiary or Affiliated Company) to terminate the
Optionee's employment at any time or for any reason.
6. Term of Plan. The Plan shall become effective upon its adoption
by the Board or its approval by vote of the holders of a majority of the
outstanding Shares of the Company entitled to vote on the adoption of the
Plan, whichever is earlier. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 14 of the Plan.
7. Term of Option. The term of each Option shall be ten (10) years
from the date of grant thereof or such shorter term as may be provided in
the Option agreement. However, in the case of an Incentive Stock Option
granted to an Optionee who, at the time the Incentive Stock Option is
granted, owns stock representing more than ten percent (10%) of the voting
power of all classes of stock of the Company or any Parent or Subsidiary,
the term of the Option shall be five (5) years from the date of grant
thereof or such shorter time as may be provided in the Option agreement.
8. Exercise Price and Consideration.
(a) Exercise Price. The per Share exercise price for the Shares
issuable pursuant to an Option shall be such price as is determined by the
Administrator, but shall in no event be less than 100% of the Fair Market
Value of Common Stock, determined as of the date of grant of the Option.
In the event that the Administrator shall reduce the exercise price, the
exercise price shall be no less than 100% of the Fair Market Value as of
the date of that reduction. In no event shall the per Share exercise price
be less than 110% of the Fair Market Value per Share as of the date of
grant in the case of an Incentive Stock Option granted to an Optionee who,
immediately before the grant of such Option, owns Shares representing more
than 10% of the voting power or value of all classes of stock of the
Company or any Parent or Subsidiary.
(b) Method of Payment. The consideration to be paid for the
Shares to be issued upon exercise of an Option, including the method of
payment, shall be determined by the Administrator (and, in the case of an
Incentive Stock Option, shall be determined at the time of grant) and may
consist of (i) cash, (ii) check, (iii) promissory note, (iv) other Shares
which (x) in the case of Shares acquired upon exercise of an Option, have
been owned by the Optionee for more than six (6) months on the date of
surrender, and (y) have a Fair Market Value on the date of surrender equal
to the aggregate exercise price of the Shares as to which said Option shall
be exercised, (v) delivery of a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the
Company the amount of sale or loan proceeds required to pay the exercise
price, (vi) if the Optionee is subject to Section 16 of the Exchange Act,
by delivering an irrevocable subscription agreement for the Shares which
irrevocably obligates the Optionee to take and pay for the Shares not more
than twelve (12) months after the date of delivery of the subscription
agreement, or (vii) any combination of the foregoing methods of payment
and/or any other consideration or method of payment as shall be permitted
under applicable corporate law.
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9. Stock Appreciation Rights.
(a) Granted in Connection with Options. At the sole discretion
of the Administrator, SARs may be granted in connection with all or any
part of an Option, either concurrently with the grant of the Option or at
any time thereafter during the term of the Option. The following
provisions apply to SARs that are granted in connection with Options:
(i) The SAR shall entitle the Optionee to exercise the SAR
by surrendering to the Company unexercised a portion of the related Option.
The Optionee shall receive in exchange from the Company an amount equal to
the excess of (x) the Fair Market Value on the date of exercise of the SAR
of the Common Stock covered by the surrendered portion of the related
Option over (y) the exercise price of the Common Stock covered by the
surrendered portion of the related Option. Notwithstanding the foregoing,
the Administrator may place limits on the amount that may be paid upon
exercise of an SAR; provided, however, that such limit shall not restrict
the exercisability of the related Option.
(ii) When an SAR is exercised, the related Option, to the
extent surrendered, shall no longer be exercisable.
(iii) An SAR shall be exercisable only when and to the
extent that the related Option is exercisable and shall expire no
later than the date on which the related Option expires.
(iv) An SAR may only be exercised at a time when the Fair
Market Value of the Common Stock covered by the related Option exceeds the
exercise price of the Common Stock covered by the related Option.
(b) Independent SARs. At the sole discretion of the
Administrator, SARs may be granted without related Options. The following
provisions apply to SARs that are not granted in connection with Options:
(i) The SAR shall entitle the Optionee, by exercising the
SAR, to receive from the Company an amount equal to the excess of (x)
the Fair Market Value of the Common Stock covered by exercised portion
of the SAR, as of the date of such exercise, over (y) the Fair Market
Value of the Common Stock covered by the exercised portion of the SAR,
as of the date on which the SAR was granted; provided, however, that
the Administrator may place limits on the amount that may be paid upon
exercise of an SAR.
(ii) SARs shall be exercisable, in whole or in part, at such
times as the Administrator shall specify in the Optionee's SAR
agreement.
(c) Form of Payment. The Company's obligation arising upon the
exercise of an SAR may be paid in Common Stock or in cash, or in any
combination of Common Stock and cash, as the Administrator, in its sole
discretion, may determine. Shares issued upon the exercise of an SAR shall
be valued at their Fair Market Value as of the date of exercise.
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(d) Rule 16b-3. SARs granted to persons who are subject to
Section 16 of the Exchange Act ("Insiders") shall contain such additional
restrictions as may be required to be contained in the plan or SAR
agreement in order for the SAR to qualify for the maximum exemption
provided by Rule 16b-3.
10. Method of Exercise.
(a) Procedure for Exercise; Rights as a Shareholder. Any Option
or SAR granted hereunder shall be exercisable at such times and under such
conditions as determined by the Administrator and as shall be permissible
under the terms of the Plan.
An Option or SAR shall be deemed to be exercised when written
notice of such exercise has been given to the Company in accordance with
the terms of the Option or SAR by the person entitled to exercise the
Option or SAR and full payment for the Shares with respect to which the
Option is exercised has been received by the Company. Full payment may, as
authorized by the Administrator (and, in the case of an Incentive Stock
Option, determined at the time of grant) and permitted by the Option
agreement, consist of any consideration and method of payment allowable
under Section 8(b) of the Plan. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company) of the stock certificate evidencing such
Shares, no right to vote or receive dividends or any other rights as a
shareholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock
certificate is issued, except as provided in Section 12 of the Plan. An
Option or SAR may not be exercised with respect to a fraction of a Share.
Exercise of an Option in any manner shall result in a decrease in
the number of Shares which thereafter shall be available, both for purposes
of the Plan and for sale under the Option, by the number of Shares as to
which the Option is exercised. Exercise of an SAR in any manner shall, to
the extent the SAR is exercised, result in a decrease in the number of
Shares which thereafter shall be available for purposes of the Plan, and
the SAR shall cease to be exercisable to the extent it has been exercised.
(b) Rule 16b-3. Options and SARs granted to Insiders must
comply with Rule 16b-3 and shall contain such additional conditions or
restrictions as may be required thereunder to be contained in the Plan or
the agreement to qualify for the maximum exemption from Section 16 of the
Exchange Act with respect to Plan transactions.
(c) Termination of Continuous Employment. Upon termination of
an Optionee's Continuous Status as Employee (other than termination by
reason of the Optionee's death), the Optionee may, but only within ninety
(90) days after the date of such termination, exercise his or her Option or
SAR to the extent that it was exercisable at the date of such termination.
Notwithstanding the foregoing, however, an Option or SAR may not be
exercised after the date the Option or SAR would otherwise expire by its
terms due to the passage of time from the date of grant.
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(d) Death of Optionee. In the event of the death of an
Optionee:
(1) Who is at the time of death an Employee and who shall
have been in Continuous Status as an Employee since the date of grant
of the Option, the Option or SAR may be exercised at any time within
six (6) months (or such other period of time not exceeding twelve (12)
months as determined by the Administrator) following the date of death
by the Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent
of the right to exercise that would have accrued had the Optionee
continued living and terminated his or her employment six (6) months
(or such other period of time not exceeding twelve (12) months as
determined by the Administrator) after the date of death; or
(2) Within ninety (90) days after the termination of
Continuous Status as an Employee, the Option or SAR may be exercised,
at any time within six (6) months (or such other period of time not
exceeding twelve (12) months as determined by the Administrator)
following the date of death by the Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or
inheritance, but only to the extent of the right to exercise that had
accrued at the date of termination.
Notwithstanding the foregoing, however, an Option or SAR may not
be exercised after the date the Option or SAR would otherwise expire by its
terms due to the passage of time from the date of grant.
(e) Stock Withholding to Satisfy Withholding Tax Obligations.
When an Optionee incurs tax liability in connection with the exercise of an
Option or SAR, which tax liability is subject to tax withholding under
applicable tax laws, and the Optionee is obligated to pay the Company an
amount required to be withheld under applicable tax laws, the Optionee may
satisfy the withholding tax obligation (including, at the election of the
Optionee, any additional amount which the Optionee desires to have withheld
in order to satisfy in whole or in part the Optionee's full estimated tax
in connection with the exercise) by electing to have the Company withhold
from the Shares to be issued upon exercise of the Option, or the Shares to
be issued upon exercise of the SAR, if any, that number of Shares having a
Fair Market Value equal to the amount required to be withheld (and any
additional amount desired to be withheld, as aforesaid). The Fair Market
Value of the Shares to be withheld shall be determined on the date that the
amount of tax to be withheld is to be determined (the "Tax Date").
All elections by an Optionee to have Shares withheld for this
purpose shall be made in writing in a form acceptable to the Administrator
and shall be subject to the following restrictions:
(i) the election must be made on or prior to the applicable
Tax Date;
(ii) once made, the election shall be irrevocable as to the
particular Shares of the Option or SAR as to which the election is made
unless revocation of the election is permitted by Rule 16b-3 and the Code;
and
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(iii) all elections shall be subject to the consent or
disapproval of the Administrator.
In the event the election to have Shares withheld is made by an
Optionee and the Tax Date is deferred under Section 83 of the Code because
no election is filed under Section 83(b) of the Code, the Optionee shall
receive the full number of Shares with respect to which the Option or SAR
is exercised but such Optionee shall be unconditionally obligated to tender
back to the Company the proper number of Shares on the Tax Date.
11. Non-Transferability of Options. Options and SARs may not be
sold, pledged, assigned, hypothecated, transferred or disposed of in any
manner other than by will or by the laws of descent or distribution or
pursuant to a qualified domestic relations order as defined by the Code or
Title I of the Employee Retirement Income Security Act, or the rules
thereunder. The designation of a beneficiary by an Optionee or holder of
an SAR does not constitute a transfer. An Option or an SAR may be
exercised, during the lifetime of the Optionee or SAR holder, only by the
Optionee or SAR holder or by a transferee permitted by this Section 11.
12. Adjustments Upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action
by the shareholders of the Company, the number of Shares covered by each
outstanding Option and SAR, and the number of Shares which have been
authorized for issuance under the Plan but as to which no Options or SARs
have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Option or SAR, as well as the price per
Share covered by each such outstanding Option or SAR, shall be
proportionately adjusted for any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the aggregate number of issued Shares effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed
to have been "effected without receipt of consideration." Such adjustment
shall be made by the Administrator, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided
herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and
no adjustment by reason thereof shall be made with respect to, the number
or price of Shares subject to an Option or SAR.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, all outstanding Options and SARs
will terminate immediately prior to the consummation of such proposed
action, unless otherwise provided by the Administrator. The Administrator
may, in the exercise of its sole discretion in such instances, declare that
any Option or SAR shall terminate as of a date fixed by the Administrator
and give each Optionee the right to exercise his or her Option or SAR as to
all or any part of the Optioned Stock or SAR, including Shares as to which
the Option or SAR would not otherwise be exercisable.
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(c) Sale of Assets or Merger. Subject to the provisions of
paragraph (d) hereof, in the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the
Company with or into another corporation, each outstanding Option and SAR
shall be assumed or an equivalent option or stock appreciation right shall
be substituted by such successor corporation or a parent or subsidiary of
such successor corporation, unless the Administrator determines, in the
exercise of its sole discretion and in lieu of such assumption or
substitution, that the Optionee shall have the right to exercise the Option
or SAR as to all of the Optioned Stock, including Shares as to which the
Option or SAR would not otherwise be exercisable. If the Administrator
makes an Option or SAR fully exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Company shall
notify the Optionee that the Option or SAR shall be fully exercisable for a
period of thirty (30) days from the date of such notice, and the Option or
SAR will terminate upon the expiration of such period. For purposes of
this paragraph, an Option granted under the Plan shall be deemed to be
assumed if, following the sale of assets or merger, the Option confers the
right to purchase, for each Share of Optioned Stock subject to the Option
immediately prior to the sale of assets or merger, the consideration
(whether stock, cash or other securities or property) received in the sale
of assets or merger by holders of Common Stock for each Share held on the
effective date of the transaction (and if such holders were offered a
choice of consideration, the type of consideration chosen by the holders of
a majority of the outstanding Shares); provided, however, that if such
consideration received in the sale of assets or merger was not solely
Common Stock of the successor corporation or its parent, the Administrator
may, with the consent of the successor corporation and the participant,
provide for the per share consideration to be received upon exercise of the
Option to be solely Common Stock of the successor corporation or its parent
equal in Fair Market Value to the per share consideration received by
holders of Common Stock in the sale of assets or merger.
(d) Change in Control. In the event of a "Change in Control" of
the Company, as defined in paragraph (e) below, unless otherwise determined
by the Administrator prior to the occurrence of such Change in Control, the
following acceleration and valuation provisions shall apply:
(1) Any Options and SARs outstanding as of the date such
Change in Control is determined to have occurred that are not yet
exercisable and vested on such date shall become fully exercisable and
vested; and
(2) The value of all outstanding Options and SARs shall,
unless otherwise determined by the Administrator at or after grant, be
cashed-out. The amount at which such Options and SARs shall be cashed
out shall be equal to the excess of (x) the Change in Control Price
(as defined below) over (y) the exercise price of the Common Stock
covered by the Option or SAR. The cash-out proceeds shall be paid to
the Optionee or, in the event of death of an Optionee prior to
payment, to the estate of the Optionee or to a person who acquired the
right to exercise the Option or SAR by bequest or inheritance.
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(e) Definition of "Change in Control". For purposes of this
Section 12, a "Change in Control" means the happening of any of the
following:
(i) When any "person", as such term is used in
Sections 13(d) and 14(d) of the Exchange Act (other than the Company,
a Subsidiary or a Company employee benefit plan, including any trustee
of such plan acting as trustee) is or becomes the "beneficial owner"
(as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent
(50%) or more of the combined voting power of the Company's then
outstanding securities; or
(ii) The occurrence of a transaction requiring shareholder
approval, and involving the sale of all or substantially all of the
assets of the Company or the merger of the Company with or into
another corporation.
(f) Change in Control Price. For purposes of this Section 12,
"Change in Control Price" shall be, as determined by the Administrator, (i)
the highest Fair Market Value at any time within the 60-day period
immediately preceding the date of determination of the Change in Control
Price by the Administrator (the "60-Day Period"), or (ii) the highest price
paid or offered, as determined by the Administrator, in any bona fide
transaction or bona fide offer related to the Change in Control of the
Company, at any time within the 60-Day Period.
13. Time of Granting Options and SARs. The date of grant of an
Option or SAR shall, for all purposes, be the date on which the
Administrator makes the determination granting such Option or SAR. Notice
of the determination shall be given to each Employee to whom an Option or
SAR is so granted within a reasonable time after the date of such grant.
14. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan, as it may deem advisable; provided
that, to the extent necessary and desirable to comply with Rule 16b-3 or
with Section 422 of the Code (or any other Applicable Law), the Company
shall obtain shareholder approval of any Plan amendment in such a manner
and to such a degree as is required.
(b) Effect of Amendment or Termination. Any such amendment,
alteration, suspension or termination of the Plan shall not impair the
rights of any Optionee or SAR holder under any grant theretofore made
without his or her consent. Such Options and SARs shall remain in full
force and effect as if this Plan had not been amended or terminated.
15. Conditions Upon Issuance of Shares. Shares shall not be issued
with respect to an Option or SAR unless the exercise of such Option or SAR
and the issuance and delivery of such Shares pursuant thereto shall comply
with all relevant provisions of law, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and
regulations promulgated thereunder, and the requirements of any stock
exchange or quotation system upon which the Shares may then be listed or
quoted, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
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As a condition to the exercise of an Option or SAR or the
issuance of Shares upon exercise of an Option or SAR, the Company may
require the person exercising such Option or SAR to represent and warrant
at the time of any such exercise that the Shares are being purchased only
for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation
is required by any of the aforementioned relevant provisions of law.
Inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the non-
issuance or sale of such Shares as to which such requisite authority shall
not have been obtained.
16. Reservation of Shares. The Company, during the term of this
Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.
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