Exhibit 99.1
WERNER ENTERPRISES, INC.
EQUITY PLAN
1. Background and History. Werner Enterprises, Inc. (the
"Company") initially adopted the Werner Enterprises, Inc. Stock
Option Plan in 1987, such plan being approved by the Company's
shareholders on June 9, 1987 at the Company's annual meeting.
The stock option plan was amended and restated in 1988, 1994,
2000, and most recently in 2004. If approved by the Company's
shareholders, the Company desires to again amend and restate the
option plan and, as the amendment and restatement will add
restricted stock to the types of awards eligible to be granted
under the plan, rename the plan as the Werner Enterprises, Inc.
Equity Plan (the "Plan") the terms of which are set forth herein.
2. Purpose. The purpose of the Plan is to advance the
interests of the Company and its shareholders by attracting and
retaining those individuals whose skill and initiative enhance
the Company's continued success, growth and profitability. This
Plan authorizes the Company to grant nonqualified stock options,
stock appreciation rights and restricted stock (hereinafter
defined as "Awards") to employees and non-employee directors.
This Plan authorizes the grant of Awards in order to help attract
and retain key employees and non-employee directors, by further
aligning their financial interests with those of the Company's
shareholders and by providing them with participatory rights in
the future success and growth of the Company, without necessarily
requiring a financial outlay by these individuals to ensure their
participation in the Plan benefits.
3. Definitions. The following words shall have the
following meaning:
(a) "Affiliate" of the Company means any Person
that directly, or indirectly through one or more
intermediaries, Controls or is Controlled by, or is
under common Control with the Company.
(b) "Award" means a grant of an Option, one or
more Stock Appreciation Rights, or one of more shares
of Restricted Stock.
(c) "Award Agreement" means a written agreement or
instrument between the Company and a Participant
evidencing an Award.
(d) "Board" means the Board of Directors of the
Company.
(e) "Cause" means unless otherwise defined in a
Participant's employment agreement or change in control
severance agreement with the Company, in which case
such definition will apply, (i) the material
misappropriation of any of the Company's funds or
property; (ii) the conviction of, or the entering of a
guilty plea or plea of no contest with respect to, a
felony, or the equivalent thereof; (iii) commission of
an act of willful damage, willful misrepresentation,
willful dishonesty, or other willful conduct that can
reasonably be expected to have a material adverse
effect on the business, reputation, or financial
situation of the Company; or (iv) gross negligence or
willful misconduct in performance of a Participant's
duties; provided, however, "cause" shall not exist
under clause (iv), above, with respect to an act or
failure to act unless (A) the Participant has been
provided written notice describing in sufficient detail
the acts or failure to act giving rise to the Company's
assertion of such gross negligence or misconduct,
(B) been provided a reasonable period to remedy any
such occurrence and (C) failed to sufficiently remedy
the occurrence.
(f) "Change in Control" means the first to occur
of the following events:
(1) Any Person, other than a Member of the
Werner Family, is or becomes the Beneficial
Owner (within the meaning set forth in Rule
13d-3 under the 1934 Act), directly or
indirectly, of securities of the Company (not
including for this purpose any securities
acquired directly from the Company or its
Affiliates or held by an employee benefit
plan of the Company) representing 50% or
more of the combined voting power of the
Company's then outstanding securities,
excluding any Person who becomes such a
Beneficial Owner in connection with a
transaction described in clause (x) of
paragraph (3) of this definition; or
(2) The following individuals cease for any
reason to constitute a majority of the number
of directors then serving: individuals who,
on the Effective Date, constitute the Board
and any new director (other than a director
whose initial assumption of office is in
connection with an actual or threatened
election contest, including a consent
solicitation, relating to the election of
directors of the Company) whose appointment
or election by the Board or nomination for
election by the Company's shareholders was
approved by a vote of at least two-thirds of
the directors then still in office who either
were directors on the Effective Date or whose
appointment, election or nomination for
election was previously so approved or
recommended; or
(3) There is consummated a merger or
consolidation of the Company with any other
corporation, OTHER THAN (x) a merger or
consolidation which would result in the
voting securities of the Company outstanding
immediately prior to such merger or
consolidation continuing to represent (either
by remaining outstanding or by being
converted into voting securities of the
surviving entity or any parent thereof), in
combination with the ownership of any trustee
or other fiduciary holding securities under
an employee benefit plan of the Company, at
least 50% of the combined voting power of the
securities of the Company or such surviving
entity or any parent thereof outstanding
immediately after such merger or
consolidation, or (y) a merger or
consolidation effected to implement a
recapitalization of the Company (or similar
transaction) in which no Person is or becomes
the Beneficial Owner, directly or indirectly,
of securities of the Company (not including
for this purpose any securities acquired
directly from the Company or its Affiliates
other than in connection with the acquisition
by the Company or its Affiliates of a
business) representing 50% or more of the
combined voting power of the Company's then
outstanding securities; or
(4) The shareholders of the Company approve
a plan of complete liquidation or dissolution
of the Company or there is consummated an
agreement for the sale or disposition by the
Company of all or substantially all of the
Company's assets, other than a sale or
disposition by the Company of all or
substantially all of the Company's assets to
an entity, at least 50% of the combined
voting power of the voting securities of
which are owned by shareholders of the
Company in substantially the same proportions
as their ownership of the Company immediately
prior to such sale.
Notwithstanding the foregoing, a "Change in
Control" shall not be deemed to have occurred by
virtue of (i) the consummation of any transaction
or series of integrated transactions immediately
following which the record holders of the Common
Stock immediately prior to such transaction or
series of transactions continue to have
substantially the same proportionate ownership in
an entity which owns all or substantially all of
the Company's assets immediately following such
transaction or series of transactions or (ii) the
acquisition of shares of Common Stock by the
Company such that, by reducing the number of
outstanding shares of Common Stock, the
proportionate number of shares of Common Stock
Beneficially Owned by a Person was increased, and,
but for this sentenced resulted in a Change in
Control.
(g) "Code" means the Internal Revenue Code of
1986, as amended from time to time.
(h) "Company" means Werner Enterprises, Inc., a
Nebraska corporation.
(i) "Committee" means (A) the Board, or (B) one or
more committees of the Board to whom the Board has
delegated all or part of its authority under this Plan.
Initially, the Committee shall be the Compensation
Committee of the Board which is delegated all of the
Board's authority under this Plan as contemplated by
clause (B) in this definition.
(j) "Common Stock" or "Stock" means the common
stock of the Company, par value $.01 per share.
(k) "Control" means the possession, directly or
indirectly, of the power to direct or cause the
direction of the management and policies of a person,
whether through the ownership of voting securities, by
contract or otherwise.
(l) "Effective Date" means May 8, 2007, such date
being the date this amended and restated Plan was
approved by the Company's shareholders.
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(m) "Exchange Act" means the Securities Exchange
Act of 1934, as amended from time to time.
(n) "Fair Market Value" means: (i) if the Stock is
traded on a national securities exchange, the closing
trading price of a share of Stock for composite
transactions, as published by The Wall Street Journal
for the date in question; or (ii) if the Stock is not
traded on a national securities exchange, the value of
the Stock determined in good faith by the Committee in
its sole discretion.
(o) "Good Reason" means, without a Participant's
written consent and unless otherwise defined in a
Participant's employment agreement or change in control
severance agreement with the Company (in which case
such definition will apply), any of the following:
(1) Any material and adverse reduction or
material and adverse diminution in a
Participant's position (including status,
offices, titles and reporting requirements),
authority, duties or responsibilities held,
exercised or assigned at any time during the
90-day period immediately preceding the
Change in Control;
(2) Any reduction in a Participant's annual
base salary as in effect immediately
preceding the Change in Control or as the
same may be increased from time to time; or
(3) A Participant being required by the
Company to be based at any office or location
that is more than 70 miles from the location
where the Participant was employed
immediately preceding the Change in Control.
Provided, however, notwithstanding the occurrence
of any of the events set forth above in this
definition, Good Reason shall not include for the
purpose of this definition (1) an isolated,
insubstantial and inadvertent action not taken in
bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by
the Participant, or (2) any reduction in the
Participant's base annual salary or reduction in
benefits received by the Participant where such
reduction is in connection with a company-wide
reduction in salaries or benefits.
(p) "Member of the Werner Family" means (i)
Clarence L. Werner and any other person who shall be a
lineal descendant, naturally or by legal adoption, of
Clarence L. Werner (each such person being referred to
as a "Werner Descendant"), (ii) a spouse of a Werner
Descendant, and (iii) a trust, corporation, limited
liability company or partnership under the terms of
which the principal beneficiaries are Werner
Descendants or persons included in clause (i) or (ii).
For purposes of the foregoing, a person who is a spouse
of a Werner Descendant at the time of the death of such
Werner Descendant shall continue to be a Member of the
Werner Family following such death only so long as
there is living a Werner Descendant who is an issue
(naturally or by legal adoption) from the marriage of
such person and such deceased Werner Descendant.
(q) "Option" means a right to purchase Common
Stock, granted pursuant to the Plan. All Options
granted under the Plan will be nonqualified stock
options and not "Incentive Stock Options" under Section
422 of the Code.
(r) "Option Price" means the purchase price for
Common Stock under an Option, as determined in Section
7 below.
(s) "Plan" means this Werner Enterprises, Inc.
Equity Plan, as amended from time to time.
(t) "Participant" means an employee or
non-employee director of the Company (or any of its
subsidiaries) to whom an Award is granted under the
Plan.
(u) "Person" shall have the meaning ascribed to
such term in Section 3(a)(9) of the Exchange Act and
used in Sections 13(d) and 14(d) thereof, including
"group" as defined in Section 13(d) thereof.
(v) "Restricted Stock" means Stock granted under
Section 9 that is subject to those restrictions set
forth therein and the Award Agreement.
(w) "Rule 16b-3" means Rule 16b-3 promulgated
under the Exchange Act.
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(x) "Stock Appreciation Right" or "SAR" means a
right to receive an amount equal to the appreciation in
a share of Stock from the grant date to the exercise
date and granted pursuant to Section 8 below.
4. Stock Subject to Plan; Award Limits.
(a) Number of Shares. Subject to the provisions of
Section 12 of the Plan, the maximum number of shares of
Common Stock that may be issued under the Plan is
20,000,000 shares. Such shares may be treasury, or
authorized but unissued, shares of Common Stock of the
Company.
(b) Award Limitation. Subject to adjustment
pursuant to Section 12, Awards covering no more than
2,562,500 shares in the aggregate may be granted to one
person during the Plan's duration.
(c) Unused and Forfeited Stock. Any shares of
Common Stock that are subject to an Award under this
Plan that are not used because the terms and conditions
of the Award are not met, including any shares that are
subject to an Award that expires or is terminated for
any reason, any shares that are used for full or
partial payment of the purchase price of shares with
respect to which an Option is exercised and any shares
retained by the Company pursuant to Section 17(b) shall
automatically become available for use under the Plan.
5. Administration.
(a) Composition. The Plan shall be administered by
the Committee. To the extent the Board considers it
desirable for transactions relating to Awards to be
eligible to qualify for an exemption under Rule 16b-3,
the Committee shall consist of two or more directors of
the Company, all of whom qualify as "non-employee
directors" within the meaning of Rule 16b-3. To the
extent the Board considers it desirable for
compensation delivered pursuant to Awards to be
eligible to qualify for an exemption from the limit on
tax deductibility of compensation under Section 162(m)
of the Code, the Committee shall consist of two or more
directors of the Company, all of whom shall qualify as
"outside directors" within the meaning of Code Section
162(m).
(b) Authority. Two members of the Committee shall
constitute a quorum for the transaction of business.
The Committee is granted the authority to determine the
recipients of Awards, the number of shares subject to
such Awards, if applicable, the date on which Awards
are granted, become exercisable or vested, and any
other terms of the Awards consistent with the terms of
this Plan. The interpretation and construction of any
provision of the Plan by the Committee shall be final,
unless otherwise determined by a majority of the entire
Board. No member of the Board or the Committee shall
be liable for any action or determination made by him
in good faith.
(c) Delegation. Notwithstanding the general
administrative powers discussed above, the Board may,
by resolution, expressly delegate to a special
committee consisting of two or more directors, who may
also be officers of the Company, or to a senior
executive officer of the Company, the authority, within
specified parameters, to (i) grant employees Awards
under the Plan, and (ii) determine the number of such
Awards to be received by any such participants;
provided, however, that if such delegation of duties
and responsibilities is to officers of the Company or
to directors who are not "non-employee directors"
(within the meaning of Rule 16b-3(b)(3) under the
Exchange Act) and "outside directors" (within the
meaning of Code Section 162(m)), such officers or
directors may not grant Awards to employees (a) who are
subject to Section 16(a) of the Exchange Act at the
time of grant, or (b) who, at the time of grant, are
anticipated to become during the term of the Award,
"covered employees" as defined in Code Section
162(m)(3). The acts of such delegate(s) shall be
within limits specifically prescribed by the Board,
will be treated hereunder as acts of the Board and such
delegate(s) shall report regularly to the Board and the
Compensation Committee of the Board regarding the
delegated duties and responsibilities and any Awards so
granted.
6. Eligibility. The Committee may grant Awards to any key
employee (including an employee who is a director and/or an
officer of the Company and its subsidiaries) and any non-employee
director. Awards may be granted by the Committee at any time and
may include or exclude new or previous Participants as the
Committee shall determine. Awards granted at different times
need not contain similar provisions.
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7. Stock Options. The Committee may grant one or more
Options to a Participant. Each Option will be evidenced by a
written Award Agreement and entered into by the Company and the
Participant to whom the Option is granted, such Award Agreement
containing or being subject to the following terms and
conditions:
(a) Option Price. The purchase price of Common
Stock under each Option shall be not less than 100
percent of the Fair Market Value of the Common Stock on
the date the Option is granted. In addition, the Plan
allows, at the discretion of the Committee, the
surrender of an Option and its subsequent regrant. The
regranting of the Option may allow for lower-priced
shares (as then valued) to be granted or for a lesser
number of shares than originally intended to be issued.
However, as with the originally issued option shares,
the price to the Participant may not be less than the
Fair Market Value of the regranted optioned shares, as
determined at the time of regrant.
(b) Time and Method of Payment. The Option Price
shall be paid in full at the time an Option is
exercised under the Plan through a payment of cash or
cashier's check or, if permitted by the Committee, the
surrender or attestation of previously acquired Stock,
the payment through a broker in accordance with
procedures permitted by Regulation T of the Federal
Reserve Board, or any other method permitted under
applicable law. Exercise of an Option without
concurrent payment in full shall be invalid and of no
effect. Upon the exercise of an Option and the payment
of the full Option Price, the Participant shall be
entitled to the issuance of a stock certificate
evidencing his ownership of such Common Stock and, as
of that date, the Participant shall have all the rights
of a shareholder. No adjustment will be made for
dividends or other rights for which the record date is
prior to the date the Participant is entitled to the
issuance of a stock certificate.
(c) Number of Shares. Each Option shall state the
total number of shares of Common Stock to which it
pertains. The number of shares to which a Participant
is entitled under an Option shall be reduced by the
number of Stock Appreciation Rights (described in
Section 8 below) related to the Option that have been
previously exercised by the Participant.
(d) Option Period and Limitations on Exercise of
Options. The Committee may in its discretion provide
that an Option may become exercisable only after the
expiration of a period of time specified in the Option
Award Agreement. Except as provided in the Option
Award Agreement, Options shall not be exercisable until
the expiration of six months from the date the Option
is granted, and any Option may be exercised in whole or
in part. No Option may be exercised after the
expiration of ten years and one day from the date it is
granted. Unless otherwise noted in the Option Award
Agreement, no Option may be exercised for a fractional
share of Common Stock.
(e) Limitations Upon Exercise of Options. If a
Participant exercises an Option, the SARs to which the
Option relates shall expire. Adjustment to the number
of shares in the Plan and the price per share pursuant
to Section 12 below shall also be made to any Options
held by each Participant.
(f) No Obligation To Exercise Option. The granting
of an Option shall impose no obligation upon the
Participant to exercise such Option.
8. Stock Appreciation Rights. The Committee may grant
Stock Appreciation Rights at the same time as Participants are
awarded Options under the Plan. Such Stock Appreciation Rights
shall be evidenced by a written Award Agreement and entered into
by the Company and the Participant to whom the SAR is granted,
such agreement containing or being subject to the following terms
and conditions:
(a) Grant. Each SAR shall relate to a specific
Option under the Plan and shall be awarded to a
Participant concurrently with the grant of such Option.
The number of SARs granted to a Participant may be
equal to the number of shares that the Participant is
entitled to receive pursuant to the related Option. The
number of SARs held by a Participant shall be the
number of SARs granted reduced by:
(1) the number of SARs exercised for Common
Stock or cash pursuant to the SARs Award
Agreement; or
(2) the number of shares of Common Stock
purchased by such Participant pursuant to the
related Option.
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(b) Manner of Exercise. A Participant shall
exercise SARs by giving written notice of such exercise
to the Company. The date on which such written notice
is received by the Company shall be the exercise date
for the SARs.
(c) Appreciation Available. Each SAR shall entitle
a Participant to the excess of the Fair Market Value of
a share of Common Stock on the exercise date over the
Option Price of the related Option.
(d) Payment of Appreciation. The appreciation
available to a Participant from an exercise of one or
more SARs may, in the sole discretion of the Committee,
be paid to the Participant either in cash or Common
Stock. If paid in cash, the amount thereof shall be
the amount of appreciation available (see (c) above).
If paid in Common Stock, the number of shares that
shall be issued pursuant to the exercise of SARs shall
be determined by dividing the amount of appreciation by
the Fair Market Value of a share of Common Stock on the
exercise date of the SAR; provided, however, that no
fractional shares shall be issued upon the exercise of
SARs.
(e) Limitations Upon Exercise of SARs. If a
Participant exercises a SAR for cash, the Option to
which the SARs relates shall expire. SARs may be
exercised only at such times and by such persons as may
exercise Options under the Plan. Adjustment to the
number of shares in the Plan and the price per share
pursuant to Section 12 below shall also be made to any
SARs held by each Participant.
(f) No Obligation To Exercise SARs. The granting
of one or more SARs shall impose no obligation upon the
Participant to exercise such SARs
9. Restricted Stock. The Committee may grant shares of
Restricted Stock in such amounts as the Committee shall determine
and subject to the terms and provisions of this Plan.
(a) Restrictions. A Participant's right to retain
shares of Restricted Stock shall be subject to such a
restriction that the Participant continue to perform as
an Employee or remain a non-employee director for a
restriction period specified by the Committee and not
less than one year nor more than ten years. The
Committee may also require that a Participant's right
to retain shares of Restricted Stock is subject to the
attainment of specified performance goals and
objectives. The Committee may, in its sole discretion,
require different periods of service or different
performance goals and objectives with respect to
(i) different Participants or (ii) separate, designated
portions of the shares that are Restricted Stock. Any
grant of Restricted Stock shall contain terms such that
the Award is either exempt from Code Section 409A or
complies with such Section.
(b) Privileges of a Shareholder, Transferability.
Unless otherwise provided in the Award Agreement, a
Participant shall not have voting, dividend,
liquidation and other rights with respect to shares of
Restricted Stock. If a Participant is granted in the
Award Agreement any voting, dividend, liquidation or
other rights on shares of Restricted Stock, such rights
(1) shall accrue to the benefit of a Participant only
with respect to shares of Restricted Stock held by, or
for the benefit of, the Participant on the record date
of any such dividend or voting date and (2) subject to
the terms of the Award Agreement, any dividends paid on
shares of Restricted Stock before such shares become
vested may be held in escrow by the Company and subject
to the same restrictions on transferability and
forfeitability as the underlying shares of Restricted
Stock. A Participant's right to sell, encumber or
otherwise transfer such Restricted Stock shall, in
addition to the restrictions otherwise provided for in
the Award Agreement, be subject to the limitations of
Section 9(b) hereof.
(c) Enforcement of Restrictions. The Committee
may, in its sole discretion, require one or more of the
following methods of enforcing the restrictions
referred to in Section 9(a) and (b):
(1) placing a legend on the Stock
certificates referring to restrictions;
(2) requiring the Participant to keep the
Stock certificates, duly endorsed, in the
custody of the Company while the restrictions
remain in effect;
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(3) requiring that the Stock certificates,
duly endorsed, be held in the custody of a
third party nominee selected by the Company
who will hold such shares of Restricted Stock
on behalf of the Participant while the
restrictions remain in effect; or
(4) inserting a provision into the
Restricted Stock Award Agreement prohibiting
assignment of such Award Agreement until the
terms and conditions or restrictions
contained therein have been satisfied or
released, as applicable.
10. Effect of Termination of Employment on Outstanding
Awards. The Committee shall determine in each case whether a
termination of employment (including a termination due to
disability) shall be considered voluntary or involuntary. In
addition, the Committee shall determine, subject to applicable
law, whether a leave of absence or similar circumstance shall
constitute a termination of employment and the date upon which a
termination resulting therefrom became effective. Any such
determination of the Committee shall be final and conclusive,
unless overruled by the entire Board at its next regular or
special meeting. The effect of a Participant's termination of
employment on outstanding Awards is as follows:
(a) Involuntary Termination for Cause. If a
Participant's employment with the Company or a
subsidiary thereof is involuntarily terminated by the
Company or such subsidiary for Cause, all of the
Options, SARs and shares of Restricted Stock held by
the Participant will immediately terminate and be
forfeited and his rights under the Award Agreement to
exercise the Options or SARs, or become vested in the
Restricted Shares, as the case may be, will immediately
terminate.
(b) Involuntary Termination by Company Other Than
for Cause or Voluntary Resignation-Effect on Options
and SARs. If the Company involuntarily terminates a
Participant's employment not for Cause or if a
Participant's employment with the Company or a
subsidiary of the Company is voluntarily terminated by
the Participant, the Participant may exercise his or
her Options or SARs that are otherwise exercisable
pursuant to this Plan on the date of such termination
for up to and including one hundred and eighty (180)
days after such termination of his or her employment,
but in no event shall any Option or SAR be exercisable
more than ten years and one day from the date it was
granted. The Committee has the right to cancel an
Option or SAR during such 180 day period if the
Participant engages in employment or activities
contrary, in the opinion of the Committee, to the best
interests of the Company.
(c) Voluntary Resignation-Effect on Restricted
Shares. If a Participant's employment with the Company
or a subsidiary of the Company is voluntarily
terminated by the Participant, all unvested Restricted
Shares then held by the Participant shall be forfeited
and returned to the Company effective as of the date of
the Participant's termination.
(d) Death.
(1) If a Participant dies while employed by
the Company, or within one hundred and eighty
(180) days after having retired or
voluntarily terminated his or her employment,
and at the time of death had unexercised
Options or SARs, the executors or
administrators, or legatees or heirs, of his
estate shall have the right to exercise such
Options and SARs within one year of the
Participant's death to the extent that such
deceased Participant was entitled to exercise
the Options and SARs on the date of his
death; provided, however, that in no event
shall the Options or SARs be exercisable more
than ten years and one day from the date they
were granted. As a condition to any such
exercise, the Committee may require any such
executor, administrator, legatee or heir
seeking to exercise such Options or SARs to
provide evidence satisfactory to the
Committee, in its sole discretion, of his or
her authority to exercise such Options or
SARs on behalf of the Participant's estate.
(2) If the Participant dies while holding
shares of Restricted Stock which have not
otherwise been forfeited, all service period
and other restrictions applicable to the
shares of Restricted Stock then held by him
or her shall lapse, and such shares shall
become fully vested and nonforfeitable.
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11. Nonassignability.
(a) General Rule. Except as provided below in
Section 11(b), no Award may be assigned, alienated,
pledged, hypothecated, attached or sold or otherwise
transferred or encumbered by a Participant except by
will or by the laws of descent and distribution, and
any such purported assignment, alienation, pledge,
attachment, sale, transfer or encumbrance shall be void
and unenforceable against the Company. If the
Participant attempts to alienate, assign, pledge,
hypothecate or otherwise dispose of Participant's
Award, the Board may terminate the Participant's Award
by notice to him or her and such Award will thereupon
become null and void.
(b) Permitted Transfers. Pursuant to conditions
and procedures established by the Committee from time
to time, the Committee may permit Awards to be
transferred to, exercised by and paid to certain
persons or entities related to a Participant, including
members of the Participant's immediate family,
charitable institutions, or trusts or other entities
whose beneficiaries or beneficial owners are members of
the Participant's immediate family and/or charitable
institutions (a "Permitted Transferee"). In the case
of initial Awards, at the request of the Participant,
the Committee may permit the naming of the related
person or entity as the Award recipient. Any permitted
transfer shall be subject to the condition that the
Committee receive evidence satisfactory to it that the
transfer is being made for estate and/or tax planning
purposes on a gratuitous or donative basis and without
consideration (other than nominal consideration).
12. Adjustments in Authorized Shares.
(a) If, without the receipt of consideration
therefore by the Company, the Company at any time
increases or decreases the number of its outstanding
shares of Common Stock or changes in any way the rights
and privileges of such shares such as, but not limited
to, the payment of a stock dividend or any other
distribution upon such Stock payable in Stock, or
through a stock split, subdivision, consolidation,
combination, reclassification or recapitalization
involving the Stock, such that any adjustment is
necessary in order to prevent dilution or enlargement
of the benefits or potential benefits intended to be
made available under the Plan then in relation to the
Stock that is affected by one or more of the above
events, the numbers, rights and privileges of (i) the
aggregate number of shares of Common Stock available
for Awards under the Plan, (ii) the aggregate number of
shares that may be subject to Awards granted to any one
person, (iii) the shares of Stock then included in each
outstanding Award granted hereunder and (iv) the Option
Price, if applicable, shall be increased, decreased or
changed in like manner as if they had been issued and
outstanding, fully paid and non assessable at the time
of such occurrence. The manner in which such
adjustments are made shall be determined by the Board
or Committee in its sole discretion provided such
adjustments are consistent with the provisions of
Section 12(b), below.
(b) General Adjustment Rules.
(1) If any adjustment or substitution
provided for in this Section 12 shall result
in the creation of a fractional share under
any Award, such fractional share shall be
rounded up to a whole share and no fractional
share shall be issued.
(2) In the case of any such substitution or
adjustment affecting an Option or a SAR such
substitution or adjustments shall be made in
a manner that is in accordance with the
substitution and assumption rules set forth
in Treasury Regulations 1.424-1 and the
applicable guidance relating to Code Section
409A.
13. Reorganization, Change in Control or Liquidation.
(a) Except as otherwise provided in an Award
Agreement or other agreement approved by the Committee
to which any Participant is a party, in the event that,
within the period commencing on a Change in Control and
ending on the second anniversary of the Change in
Control, and except as the Committee may expressly
provide otherwise, a Participant's employment with the
Company or one of its affiliates is terminated other
than for Cause, or the Participant voluntarily resigns
for Good Reason, then (i) all Options and SARs then
outstanding shall become fully exercisable, and (ii)
all restrictions (other than restrictions imposed by
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law) and conditions on all Restricted Stock Awards then
outstanding shall be deemed satisfied as of the date of
the Participant's termination of employment.
(b) In addition to the foregoing, in the event the
Company undergoes a Change in Control or in the event
of a corporate merger or consolidation (other than a
merger or consolidation in which the Company is the
continuing corporation and that does not result in any
reclassification or change of outstanding shares of
Common Stock), major acquisition of property (or
stock), separation, reorganization or liquidation in
which the Company is a party and in which a Change in
Control does not occur, the Committee, or the board of
directors of any corporation assuming the obligations
of the Company, shall have the full power and
discretion to take any one or more of the following
actions:
(1) Without reducing the underlying economic
value of any Award, amend the procedures and
conditions for the exercise or settlement of
any outstanding Awards granted hereunder;
(2) Provide for the purchase by the Company
of any Award, upon the Participant's request,
for, with respect to an Option or SAR, an
amount of cash equal to the positive amount,
if any, that could have been attained upon
the exercise of such Award or realization of
the Participant's rights had such Award been
currently exercisable, or, in the case of
Restricted Stock, the Fair Market Value of
such shares of Stock;
(3) Provide that Options or SARs granted
hereunder must be exercised in connection
with the closing of such transactions, and
that if not so exercised such Options or SARs
will expire;
(4) Make such adjustment to any Award that
is outstanding as the Committee or Board
deems appropriate to reflect such Change in
Control or corporate event; or
(5) Cause any Award then outstanding to be
assumed, or new rights of equivalent economic
value substituted therefore, by the acquiring
or surviving corporation.
Any such determinations by the Committee may be made
generally with respect to all Participants, or may be
made on a case-by-case basis with respect to
particular Participants. Notwithstanding the
foregoing, any transaction undertaken for the purpose
of reincorporating the Company under the laws of
another jurisdiction, if such transaction does not
materially affect the beneficial ownership of the
Company's capital stock, such transaction shall not
constitute a merger, consolidation, major acquisition
of property for stock, separation, reorganization,
liquidation, or Change in Control.
14. Termination and Amendment. The Board, by resolution,
may terminate the Plan with respect to any Awards that have not
been granted. The Board or Committee may at any time amend or
modify, the Plan; provided, however, that no amendment or
modification may become effective without approval of the
amendment or modification by the shareholders if shareholder
approval is required to enable the Plan to satisfy any applicable
statutory or regulatory requirements, to comply with the
requirements for listing on any exchange where the Stock is
listed, or if the Company, on the advice of counsel, determines
that shareholder approval is otherwise necessary or desirable.
Notwithstanding any other provision of the Plan to the contrary
(but subject to a Participant's employment being terminated for
Cause), no termination, amendment or modification of the Plan
shall adversely affect in any material way any Award previously
granted under the Plan, without the written consent of the
Participant of such Award.
15. Agreement and Representation of Employees. As a
condition to the receipt of any shares of Stock under the Plan,
the Company may require the person receiving such shares to
represent and warrant that the shares of Common Stock are being
acquired 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 under the
Securities Act of 1933 or any other applicable law, regulation or
rule of any governmental agency.
16. Reservation of Shares of Common Stock. The Company,
during the term of the Plan, will at all times reserve and keep
available the number of shares of Common Stock that shall be
sufficient to satisfy the requirements of this Plan. The
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inability of the Company to obtain from any regulatory body
having jurisdiction the authority deemed necessary by legal
counsel for the Company for the lawful issuance and sale of its
Common Stock hereunder shall relieve the Company of any liability
in respect of the failure to issue or sell Common Stock as to
which the requisite authority has not been obtained.
17. Withholding.
(a) Withholding Requirement. The Company's
obligations to deliver Shares upon the exercise of an
Option, or upon the vesting of any other Award, shall
be subject to the Participant's satisfaction of all
applicable federal, state and local income and other
tax withholding requirements.
(b) Withholding with Stock. The Committee may, in
its sole discretion, permit a Participant to pay all
minimum required amounts of tax withholding, or any
part thereof, by electing to transfer to the Company,
or to have the Company withhold from the shares of
Common Stock otherwise issuable to the Participant,
shares of Common Stock having a value not to exceed the
minimum amount required to be withheld under federal,
state or local law or such lesser amount as may be
elected by the Participant. The Committee may require
that any shares transferred to the Company have been
held or owned by the Participant for a minimum period
of time. All elections shall be subject to the
approval or disapproval of the Committee. The value of
shares of Stock to be withheld shall be based on the
Fair Market Value of the Stock on the date that the
amount of tax to be withheld is to be determined (the
"Tax Date"), as determined by the Committee. Any such
elections by Participant to have Shares withheld for
this purpose will be subject to the following
restrictions:
(1) All elections must be made prior to the
Tax Date;
(2) All elections shall be irrevocable; and
(3) If the Participant is an officer or
director of the Company within the meaning of
Section 16 of the 1934 Act ("Section 16"),
the Participant must satisfy the requirements
of such Section 16 and any applicable rules
thereunder with respect to the use of Stock
to satisfy such tax withholding obligation.
18. Effective Date of Plan. The Plan was originally
effective as of June 9, 1987 and this most recent amendment and
restatement, if approved by the Company's shareholders, will be
effective May 8, 2007.
19. Code Section 409A. This Plan is intended to meet or to
be exempt from the requirements of Section 409A of the Code, and
shall be administered, construed and interpreted in a manner that
is in accordance with and in furtherance of such intent. Any
provision of this Plan that would cause an Award to fail to
satisfy Section 409A of the Code or, if applicable, an exemption
from the requirements of that Section, shall be amended (in a
manner that as closely as practicable achieves the original
intent of this Plan) to comply with Section 409A of the Code or
any such exemption on a timely basis, which may be made on a
retroactive basis, in accordance with regulations and other
guidance issued under Section 409A of the Code.
20. Termination Date of Plan. This Plan may be terminated
by the Board of Directors, in its sole discretion, and no Award
shall be granted pursuant to this Plan after such termination.
Termination of this Plan shall not affect any Award granted
during the term of this Plan.
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