Exhibit 4(iv)
ATLANTIC ENERGY, INC.
AND SUBSIDIARIES
EMPLOYEE STOCK PURCHASE PLAN
ARTICLE ONE - DEFINITIONS
Whenever used in this document, the following terms
shall have the respective meanings set forth below, unless a
different meaning is plainly required by the context:
1.0 Definitions
1.1 "Annual Base Compensation" means, with respect to a full-
time Employee, the Employee's Base Salary or 2,080 times the
Employee's Base Hourly Rate, whichever is applicable, in
effect on the date two months before the first Offering
Commencement Date. "Annual Base Compensation" means, with
respect to a non-full-time Employee, the amount equal to his
or her Base Hourly Rate in effect on the date two months
before the first Offering Commencement Date multiplied by
the number of Hours of Service compensated during the 12-
month period immediately preceding the date two months
before the first date of the applicable Offering Period.
1.2 "Base Salary" means the annual salary rate received by an
Employee, whose compensation is determined on a salaried
basis, as remuneration for services performed exclusive of
payments for overtime, lump sums in lieu of "Base Salary"
increases, shift premiums, bonuses paid in cash or stock and
other special payments, commissions and other incentive
payments.
1.3 "Base Hourly Rate" means the hourly rate of pay received by
an Employee whose compensation is determined on a non-
salaried basis, as remuneration for services performed,
exclusive of payments for overtime, lump sums in lieu of
"Base Hourly Rate" increases, shift premiums, bonuses paid
in cash or stock and other special payments, commissions and
other incentive payments.
1.4 "Board of Directors" means the Board of Directors of
Atlantic Energy, Inc.
1.5 "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
1.6 "Committee" means the Personnel & Benefits Committee, or any
successor committee, of the Board of Directors.
1.7 "Common Stock" means any authorized share of ownership of
Atlantic Energy, Inc. represented by a common stock
certificate or any other appropriate instrument evidencing
the same.
1.8 "Company" means Atlantic Energy, Inc. and any present or
future corporation that (i) would be a subsidiary
corporation of Atlantic Energy, Inc. as that term is defined
in S423 of the Code and (ii) is designated as a participant
in the Plan by the Committee, or any successor corporation.
1.9 "Eligible Employee" means any Employee who meets the
eligibility criteria set forth
in S3.0.
1.10 "Employee" means any person in the employ of an Employer.
1.11 "Employee Account" means the account to which a
Participant's payroll deduction and interest, if any, will
be credited.
1.12 "Employer" means Atlantic Energy, Inc. and all of its
directly or indirectly owned subsidiary companies including
but not limited to Atlantic City Electric Company, Atlantic
Energy Enterprises, Inc., Deepwater Operating Company,
Atlantic Generation, Inc., Atlantic Thermal Systems, Inc.,
Atlantic Southern Properties, Inc., ATE Investment, Inc.,
Atlantic Energy Technology, Inc., Atlantic CNRG Services,
LLC. and CoastalComm, Inc.
1.13 "Hour of Service" means (i) each hour for which an Employee
is directly or indirectly compensated or entitled to
compensation by the Employer for the performance of duties;
(ii) each hour for which an Employee is directly or
indirectly compensated or entitled to compensation by the
Employer on account of a period of time during which no
duties are performed (such as vacation, holidays, sickness,
disability, layoff, jury duty, military duty or leave of
absence); (iii) each hour for which back pay is awarded or
agreed to by the Employer without regard to mitigation. The
same Hours of Service shall not be credited both under (i)
or (ii), as the case may be, and (iii).
1.14 "1934 Act" means the Securities Exchange Act of 1934, as
amended from time to time.
1.15 "Offering Commencement Date" means the first day of the
Offering Period.
1.16 "Offering Period" means the 12-month term that an offering
under the Plan exists pursuant to Article Four.
1.17 "Participant" means an Eligible Employee who elects to
participate in the Plan.
1.18 "Plan" means the stock purchase plan know as the "Atlantic
Energy, Inc. and Subsidiaries Employee Stock Purchase Plan"
as amended from time to time.
1.19 "Purchase Date" means the last day of an Offering Period.
ARTICLE TWO - PURPOSE
2.0 Purpose
The Atlantic Energy, Inc. and Subsidiaries (the
"Company") Employee Stock Purchase Plan (the "Plan") is
intended to encourage equity ownership in the Company by
Eligible Employees in order to increase their proprietary
interest in and promote the continued success of the
Company. It is the intention of the Company to have the
Plan qualify as an "employee stock purchase plan" under S423
of the Internal Revenue Code of 1986, as amended (the
"Code"). The provisions of the Plan shall be construed so
as to extend and limit participation in a manner consistent
with the requirements of that section of the Code.
ARTICLE THREE - ELIGIBILITY AND PARTICIPATION
3.0 Eligibility
A regular, full-time Employee shall become an Eligible
Employee upon his or her completion of one Hour of Service
that must occur no later than 14 calendar days prior to the
Offering Commencement Date. An employee who is not a
regular, full-time Employee shall become an Eligible
Employee upon completion of 1,000 Hours of Service during
the twelve consecutive-month period commencing on the date
he or she first performs an Hour of Service and ending no
later than 14 calendar days prior to the Offering
Commencement Date. If such Employee does not complete 1,000
Hours of Service during such twelve-month period, then the
Employee would become an Eligible Employee upon completion
of 1,000 Hours of Service during a subsequent twelve
consecutive-month period. Approximately 1,500 Employees are
eligible to participate in the Plan.
3.1 Participation
An Eligible Employee may become a Participant by
completing an authorization for a payroll deduction on the
form provided by the Company and filing it with the Office
of the Treasurer of the Company on or before the date set
therefor by the Committee, which date shall be prior to the
Offering Commencement Date for the Offering Period. Payroll
deductions for an Eligible Employee shall commence in the
first regular pay period following the applicable Offering
Commencement Date and shall end in the pay period
immediately preceding the Purchase Date unless sooner
terminated by the Eligible Employee as provided in Article
Eight.
3.2 Limitations to Participation
Notwithstanding any provisions of the Plan to the
contrary, no Employee shall be granted an option to
participate in the Plan: (i) if, immediately after the
grant, such Employee would own Common Stock, and/or hold
options to purchase Common Stock, possessing 5% or more of
the total combined voting power or value of all classes of
Common Stock of the Company, (for purposes of this Section,
the rules of S423(d) of the Code shall apply in determining
Common Stock ownership of any Employee); (ii) which permits
his or her rights to purchase Common Stock under all
employee stock purchase plans of the Company to accrue at a
rate that exceeds $25,000 in fair market value of the Common
Stock (determined at the time such option is granted) for
each calendar year in which such option is outstanding.
ARTICLE FOUR - OFFERINGS UNDER THE PLAN
4.0 Annual Offerings
The Plan will be implemented in four (4) Offering
Periods beginning on the 15th day of August in each of the
years 1996, 1997, 1998 and 1999, with each Offering Period
ending on August 14, of the following year. The maximum
number of shares of Common Stock issued in the respective
years shall be:
Maximum Number of
Offering Period Shares to be Issued
August 15, 1996 - August 14, 1997 100,000
August 15, 1997 - August 14, 1998 100,000 plus
unissued shares from the
prior Offering Period
August 15, 1998 - August 14, 1999 100,000 plus
unissued shares from
prior Offering Periods
August 15, 1999 - August 14, 2000 100,000 plus
unissued shares from
prior Offering Periods
ARTICLE FIVE - GRANTING OF OPTIONS
5.0 Number of Option Shares
On the Offering Commencement Date a Participant shall
be deemed to have been granted an option to purchase a
maximum number of shares of Common Stock of the Company
equal to an amount determined as follows: a) a dollar
amount designated by the employee not in excess of 10% of
the Participant's Annual Base Compensation i) divided by 85%
of the market value of the Common Stock of the Company (as
defined in S5.1 below) on the applicable Offering
Commencement Date or 2) an amount equal to (i) that
percentage of the Participant's Annual Base Compensation
that he or she has elected to have withheld (but not in
excess of 10%) (ii) multiplied by the Participant's Annual
Base Compensation, (iii) divided by 85% of the market value
of the Common Stock of the Company (as defined in S5.1
below) on the applicable Offering Commencement Date. Such
method of determination shall be at the discretion of the
Company.
5.1 Option Price
The option price of stock purchased with payroll
deductions made during an Offering Period for a Participant
therein shall be the lower of: (i) 85% of the market value
of the Common Stock, which is the average of the high and
low selling price of the stock on the Offering Commencement
Date as reported by the "NYSE-Composite Transactions"
published in The Wall Street Journal, or the nearest prior
business day on which trading occurred on the New York Stock
Exchange or (ii) 85% of the market value of the Common
Stock, which is the average of the high and low selling
price of the stock on the Purchase Date or the nearest prior
business day on which trading occurred on the New York Stock
Exchange. If the Common Stock of the Company is not
admitted to trading on any of the aforesaid dates for which
the high and low selling prices of the stock are to be
determined, then reference shall be made to the fair market
value of the stock on that date, as determined on such basis
as shall be established or specified for the purpose by the
Committee. On December 29, 1995 the closing price of the
stock on the NYSE was $19.25.
ARTICLE SIX - EXERCISE OF OPTION
6.0 Automatic Exercise
Unless a participant gives written notice to the
Company as hereinafter provided, his or her option to
purchase shares of Common Stock through payroll deductions
made during any Offering Period will be deemed to have been
exercised automatically on the Purchase Date applicable to
such Offering Period for the purchase of the number of whole
shares of Common Stock which the accumulated payroll
deductions credited to his or her Employee Account at that
time will purchase at the applicable option price (but not
in excess of the number of shares for which options have
been granted to the employee pursuant to S5.0 hereof), and
any excess in his or her Employee Account at that time will
be returned as soon as practicable following the Purchase
Date.
6.1 Fractional Shares
Fractional shares will not be issued under the Plan and
any accumulated payroll deductions that would have been used
to purchase fractional shares will be returned to a
Participant as soon as practicable following the Purchase
Date.
6.2 Transferability of Option
During a Participant's lifetime, options held by such
Participant shall be exercisable only by that Participant.
6.3 Delivery of Instrument
Common Stock to be delivered to a Participant under the
Plan will be delivered in "book-entry" form. Such Common
Stock may be subject to certain restrictions as described
S7.5. As promptly as practicable after the Purchase Date of
each Offering Period, the Company will provide to each
participant an appropriate instrument representing the stock
purchased upon exercise of his or her option. A Participant
may request a common stock certificate to be issued in his
or her name by completing the appropriate authorization.
6.4 Expiration of Option
In no event may any option granted pursuant to the Plan
be exercised after the expiration of (i) three (3) years
from the date such option is granted if the option price is
not less than 85% of the fair market value of the stock at
the time of the exercise of the option, or (ii) 27 months
from the date such option is granted if the option price is
not determinable in the manner described in (i) above.
ARTICLE SEVEN - COMMON STOCK OFFERED UNDER THE PLAN
7.0 Stock
The stock offered under the Plan shall consist in whole
or in part of (i) authorized but unissued shares of Common
Stock of the Company, or (ii) shares issued and thereafter
acquired by the Company.
7.1 Maximum Number of Shares
The maximum number of shares that shall be issued under
the Plan, subject to adjustment upon changes in
capitalization of the Company as provided in Article
Fourteen shall be 100,000 in each Offering Period plus,
beginning with the Offering Period starting on August 15,
1997, all unissued shares from prior Offering Periods, but
not to exceed 400,000 shares for all Offering Periods. If
the total number of shares for which options are exercised
on any Purchase Date in accordance with S6.0 exceeds the
maximum number of shares for the applicable offering, the
Company shall make a prorata allocation of the shares
available for delivery and distribution in as nearly a
uniform manner as shall be practicable and as it shall
determine to be equitable, and the balance of payroll
deductions, plus interest, credited to each Employee Account
shall be returned to him or her as promptly as possible.
7.2 Effects of Termination by Participants
If an Eligible Employee's participation under the Plan
for any reason ends or is terminated and the shares that are
subject to an option are not purchased, the unpurchased
shares of Common Stock shall again be available for offering
under the Plan.
7.3 Participant's Interest in Option Stock
The participant will have no ownership interest in
stock covered by his or her option until such option has
been exercised. No adjustment will be made for dividends or
other rights for which the record date is prior to the date
of issuance.
7.4 Registration of Common Stock
Common Stock to be delivered to a participant under the
Plan will be registered in the name of the participant, or,
if the participant so directs, by written notice to the
Office of the Treasurer of the Company prior to the Purchase
Date applicable thereto, in the names of the participant and
one such other person as may be designated by the
participant, as joint tenants with rights of survivorship or
to the extent permitted by applicable law.
7.5 Restrictions on Exercise
The Committee may, in its discretion, require that any
shares purchased pursuant to the Plan be subject to certain
restrictions regarding the sale of such shares. Under such
restrictions, Participants may not be permitted to sell,
transfer, pledge or assign shares purchased under the Plan
for a period of not more than one year from the Purchase
Date.
The Board of Directors may, in its discretion, require
as conditions to the exercise of any option that the shares
of Common Stock reserved for issuance upon the exercise of
the option shall have been duly listed, upon official notice
of issuance, upon a stock exchange, and that either (i) a
Registration Statement under the Securities Act of 1933, as
amended, with respect to said shares, shall be effective or
(ii) the participant shall have represented at the time of
purchase, in form and substance satisfactory to the Company,
that it is his or her intention to purchase the shares for
investment and not for resale or distribution.
ARTICLE EIGHT - WITHDRAWAL FROM THE PLAN AND TERMINATION OF
EMPLOYMENT
8.0 Withdrawal of Account
A Participant may withdraw payroll deductions credited
to his or her Employee Account under the Plan at any time
(except in no event will withdrawals be permitted in the
three business days prior to the Purchase Date) upon receipt
of written notice to the Office of the Treasurer of the
Company. All of the Participant's payroll deductions,
without interest, credited to the Employee Account will be
paid promptly after receipt of notice of withdrawal, and no
further payroll deduction will be made from the
Participant's pay during the Offering Period. As to the
Participants who are subject to Section 16 of the 1934 Act,
(generally officers of Atlantic Energy, Inc.), the right of
participation in the Plan subsequent to withdrawal shall be
governed by the limitations imposed upon each Participant
under the 1934 Act.
8.1 Effect on Subsequent Participation
A Participant's withdrawal during any Offering Period
will not have any effect upon his or her eligibility to
participate in any succeeding Offering Periods or in any
similar plan that may hereafter be adopted by the Company.
8.2 Termination of Employment
Upon termination of a Participant's employment during
the Offering Period for a reason other than retirement or
death, participation in the Plan shall terminate immediately
and within a reasonable time thereafter, the Eligible
Employee shall be paid all funds, without interest, then
credited to his or her Employee Account.
8.3 Termination of Employment due to Retirement
Upon termination of a Participant's employment during
the Offering Period due to retirement, the Participant shall
have the right to elect, by written notice given to the
Office of the Treasurer, prior to the earlier of the
Purchase Date or the expiration of a period of 90 days
commencing from the date of retirement either (i) to
withdraw all of the payroll deductions, without interest,
credited to the Participant's Employee Account under the
Plan or (ii) to exercise the Participant's option for the
purchase of Common Stock on the Purchase Date next following
the date of the Participant's retirement for the purchase of
the number of whole shares of Common Stock which the
accumulated payroll deductions, without interest, in the
Participant's Employee Account at the date of the
Participant's retirement will purchase at the applicable
option price, and any excess in such Employee Account will
be returned to the Participant as soon as practicable.
In the event that no such written notice of election
shall be duly received by the Office of the Treasurer of the
Company, the Participant shall automatically be deemed to
have elected, pursuant to (ii) above, to exercise the
Participant's option.
8.4 Termination of Employment due to Death
Upon termination of a Participant's employment during
the Offering Period due to death, the Participant's
beneficiary (as defined in Article Twelve) shall have the
right to elect, by written notice given to the Office of
Treasurer, prior to the earlier of the Purchase Date or the
expiration of a period of 90 days commencing from the date
of the Participant's death either (i) to withdraw all of the
payroll deductions, without interest, credited to the
Participant's Employee Account under the Plan, or (ii) to
exercise the Participant's option for the purchase of stock
on the Purchase Date next following the date of the
Participant's death for the purchase of the number of whole
shares of stock which the accumulated payroll deductions,
without interest, in the Participant's Employee Account at
the date of the Participant's death will purchase at the
applicable option price, and any excess in such account will
be returned to said beneficiary, without interest.
In the event that no such written notice of election
shall be duly received by the Office of the Treasurer of the
Company, the beneficiary shall automatically be deemed to
have elected, pursuant to (ii) above, to exercise the
Participant's option.
8.5 Leave of Absence
If a Participant is granted a leave of absence, such
Participant shall have the right to elect (i) to withdraw
without interest, the balance in his or her Employee Account
pursuant to S8.0, (ii) to discontinue contributions to the
Plan and forfeit any interest earned but remain a
Participant in the Plan, or (iii) remain a participant in
the Plan during such leave of absence, authorizing
deductions to be made from any payments by the company to
the Participant during such leave of absence.
ARTICLE NINE - PAYROLL DEDUCTIONS
9.0 Amount of Payroll Deduction
An Eligible Employee shall authorize the Employer in
writing to withhold funds from his or her compensation
throughout the 12-month Offering Period not in excess of 10%
of the Eligible Employee's Annual Base Compensation. Such
amounts are subject to the limitations set forth in S3.2.
Such amounts will be sufficient to accumulate over the term
of the Offering Period the aggregate purchase price of the
shares which the Eligible Employee has elected the option to
purchase pursuant to the Plan.
9.1 Employee Account
Funds withheld from a Participant's compensation shall
be credited to the Participant's Employee Account
established under the Plan. A Participant may not make any
separate cash payment into such account.
9.2 Changes in Payroll Deduction
A Participant may not increase or decrease the amount
withheld from the Participant's compensation or make other
deposits to his or her Employee Account. A Participant may
discontinue participation in the Plan as provided in Article
Eight and only shall be permitted to withdraw and be paid
any funds accumulated in the Employee Account pursuant to
the terms of the Plan.
9.3 Use of Funds
All payroll deductions received or held by the Company
under this Plan may be used by the Company for any corporate
purpose and the Company shall not be obligated to segregate
such payroll deductions.
9.4 Underfunded Status of Employee Account
If for any reason other than that set forth in S8.3,
S8.4 and S8.5 herein, the balance in a Participant's
Employee Account on the Purchase Date is less than the
aggregate purchase price of the shares which the Participant
has elected the option to purchase pursuant to the Plan, the
Participant's option will be exercised on the Purchase Date
for the number of whole shares of Common Stock which the
accumulated payroll deductions, without interest, in the
Participant's Employee Account will purchase at the
applicable option price, and any excess will be returned to
the Participant as soon as practicable.
ARTICLE TEN - INTEREST
10.0 Payment of Interest
Except as otherwise provided, interest shall be paid
during the term of the Offering Period on funds credited to
each Employee Account at the dividend rate in effect on June
30 in each of the Offering Periods and made available to
depositors holding a share savings account with the Atlantic
City Electric Company Employees' Federal Credit Union.
Interest will be compounded daily on the average daily
balance of each Employee Account beginning on the Offering
Commencement Date and ending on the last business day
preceding the Purchase Date. Interest will cease to accrue
on the Purchase Date and will be distributed to the
Participant as soon as practicable after the Purchase Date.
The Committee may determine that interest shall be paid on
the Employee Account on any other basis the Committee deems
appropriate.
ARTICLE ELEVEN - ADMINISTRATION
11.0 Personnel & Benefits Committee
The Plan shall be administered by the Personnel &
Benefits Committee of the Board of Directors. Members of
the Committee shall be Directors who are disinterested
persons under Rule 16(b)(3) promulgated under the 1934 Act
and successor rules. The Committee may employ agents,
attorneys, compensation experts, accountants or other
persons (who also may be Employees of the Employer) and
allocate or delegate to them powers, rights, and duties, all
as the Committee may consider necessary or advisable to
properly carry out the administration of the Plan. The
Committee may adopt rules and regulations as it deems
appropriate to assist in administering and enforcing the
Plan.
The Committee shall have the discretionary authority to
regulate and interpret the Plan's provisions. The
interpretation and construction by the Committee of any
provisions of the Plan, the terms and conditions of an
offering and of Employee participation and any determination
by the Committee pursuant to any provision of the Plan shall
be final and conclusive.
No member of the Board of Directors shall be liable for
any action or determination made in good faith under the
Plan.
ARTICLE TWELVE - DESIGNATION OF BENEFICIARY
12.0 Designation of Beneficiary
A Participant may file a written designation of
beneficiary who is to receive any stock and/or cash. Such
designation of beneficiary may be changed by the Participant
at any time by written notice to the Office of the
Treasurer. Upon the death of a Participant and upon receipt
by the Company of proof of identity and existence at the
Participant's death of a beneficiary validly designated by
the Participant under the Plan, the Company shall deliver
such stock and/or cash to such beneficiary. In the event of
death of a Participant and in the absence of a beneficiary
validly designated under the Plan who is living at the time
of the Participant's death, the Company shall deliver such
stock and/or cash to the any beneficiary designated by the
Participant under the Atlantic City Electric Company
Retirement Plan, ("Retirement Plan") or if the Participant
is an Employee of an affiliate any retirement plan of an
such affiliate. If no beneficiary has been designated under
the Retirement Plan or any retirement plan of an affiliate,
the Company shall deliver such stock and/or cash to the
executor or administrator of the estate of the Participant,
or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its
discretion, may deliver such stock and/or cash to the spouse
or to any one or more dependents of the Participant as the
Company may designate. No beneficiary shall, prior to the
death of the Participant by whom he or she has been
designated, acquire any interest in the stock or cash
credited to the Participant under the Plan.
ARTICLE THIRTEEN - TRANSFERABILITY AND ASSIGNABILITY
13.0 Restrictions on Transferability and Assignability
Neither payroll deductions plus interest, if any,
credited to a Participant's Employee Account nor any rights
with regard to the exercise of an option to receive stock
under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way by the Participant other
than by will or the laws of descent and distribution. Any
such attempted assignment, transfer, pledge or other
disposition shall be without effect, except that the Company
may treat such act as an election to withdraw funds in
accordance with S8.0. No right of any Employee to purchase
stock pursuant to an offering made under the Plan shall be
subject to any obligation or liability of the Participant or
have a lien imposed upon it. During the lifetime of a
Participant, the shares that he or she is entitled to
purchase under the Plan may be purchased only by the
Participant.
Shares purchased pursuant to the Plan by a Participant
who is subject to short swing profit liability under Section
16(b) of the 1934 Act cannot be transferred for at least
six months from the date of acquisition.
ARTICLE FOURTEEN - ADJUSTMENTS UPON CHANGES IN CAPITALIZATION
14.0 Recapitalization
If, while any options are outstanding, the outstanding
shares of Common Stock of the Company have increased,
decreased, changed into or been exchanged for a different
number or kind of shares or securities of the Company
through reorganization, merger, recapitalization,
reclassification, stock split, reverse stock split or
similar transaction, appropriate and proportionate
adjustments may be made by the Committee in the number
and/or kind of shares that are subject to purchase under
outstanding options and on the option exercise price or
prices applicable to such outstanding options. In addition,
in any such event, the number and/or kind of shares that may
be offered as described in Article Four hereof shall also be
proportionately adjusted. No adjustments shall be made for
stock dividends.
ARTICLE FIFTEEN - DISSOLUTION OR CHANGE IN CONTROL OF
CORPORATION
15.0 Dissolution or Change in Control
Upon the dissolution or liquidation of the Company, or
upon "Change of Control" as hereinafter defined, the holder
of each option then outstanding under the Plan will
thereafter be entitled to receive at the next Purchase Date
upon the exercise of such option for each share as to which
such option shall be exercised, the cash, securities and/or
property that a holder of one share of the Common Stock was
entitled to receive upon and at the time of such transaction
(which shall in no event be less than 85% of the Fair Market
Value, as required by Section 423 of the Code). The Board
of Directors shall take such steps in connection with such
transactions as they shall deem necessary to assure that the
provisions of this S15.0 shall thereafter be applicable in
relation to the said cash, securities and/or property as to
which such holder of such option might thereafter be
entitled to receive.
"Change of Control" of the Company shall occur (i) if
any "person" as defined in Section 3(a)(9) of the 1934 Act
and as used in Section 13(d) and 14(d) thereof, including a
"group" as defined in Section 13(d) of the 1934 Act but
excluding the Company and any Subsidiary and any employee
benefit plan sponsored or maintained by the Company or any
Subsidiary (including any trustee of such plan acting as
trustee), directly or indirectly becomes the "beneficial
owner," as defined in Rule 13(d)(3) under the 1934 Act , of
securities of the Company representing 20 percent or more of
the combined voting power of the Company's then outstanding
securities; or (ii) when, during any period of 24
consecutive months during the existence of the Plan, the
individuals who, at the beginning of such period, constitute
the Board of Directors (the "Incumbent Directors") cease for
any reason other than death to constitute at least a
majority thereof, provided however that a director who was
not a director at the beginning of such 24-month period
shall be deemed to have satisfied such 24-month requirement
(and be an Incumbent Director) if such director was elected
by, or on the recommendation of or with the approval of, at
least two-thirds of the directors who then qualified as
Incumbent Directors either actually (because they were
directors at the beginning of such 24-month period) or by
prior operation of this S15.0; or (iii) the occurrence of a
transaction requiring stockholder approval for the
acquisition of the Company by an entity other than the
Company or a subsidiary through purchase of assets, or by
merger or otherwise.
ARTICLE SIXTEEN - REQUIRED APPROVALS
16.0 Effective Date
The Plan was adopted by the Board of Directors on
February 8, 1996 and shall become effective on April 24,
1996 subject to the approval of shareholders of the majority
vote of the votes cast at the Annual Meeting of Shareholders
to be held on April 24, 1996, at which a quorum representing
the majority of all outstanding voting stock is, either in
person or by proxy, present and voting on the Plan.
ARTICLE SEVENTEEN - TERMINATION OF AND AMENDMENTS TO THE PLAN
17.0 Termination and Amendments
The Committee may amend, alter, or discontinue or
suspend the Plan or alter or amend any and all terms of
participation in an offering made thereunder at any time but
no amendment, alteration, discontinuance or suspension shall
be made that would impair the rights of a Participant
without the Participant's consent or which, without approval
of the Company's stockholders would (i) increase the total
number of shares reserved for the purpose of the Plan or the
maximum number of shares that each Participant can elect to
purchase as a result of participation in any offering under
the Plan; (ii) extend the maximum term of an Offering
Period under the Plan beyond 12 months; (iii) decrease
either the option price or change the pricing terms
specified in S5.1; (iv) materially expand the requirements
as to eligibility for Employees under the Plan; and (v)
materially increase benefits under the Plan within the
meaning of Rule 16(b)(3) under the 1934 Act to the extent
that rule is applicable.
ARTICLE EIGHTEEN - RIGHTS TO EMPLOYMENT
18.0 No Employment Rights
The Plan does not, directly or indirectly, create any
right for the benefit of any Employee or class of Employees
to purchase any shares under the Plan, or create in any
Employee or class of Employees any right with respect to
continuation of employment by the Company, and it shall not
be deeded to interfere in any way with the Company's right
to terminate or otherwise modify an Employee's employment at
any time.
ARTICLE NINETEEN - EXPENSES
19.0 Expenses
All expenses of administering the Plan shall be borne
by the Company.
ARTICLE TWENTY - CONFORMANCE WITH TAX LAWS
20.0 Section 423
The Plan and all offerings thereunder shall conform to
the requirement of Code S423 that governs employee stock
purchase plans. Should any of the terms of the Plan or
offerings be found not in conformity with the terms of Code
S423, those terms shall be invalid and shall be omitted from
the Plan or the offering but the remaining terms of the Plan
shall not be affected.
ARTICLE TWENTY-ONE - WITHHOLDING
21.0 Withholding
Any amounts to be paid or shares to be delivered under
the Plan shall be reduced by any sums required to be
withheld by the Company under federal, state and local tax
withholding laws.
ARTICLE TWENTY-TWO - GOVERNING LAW
22.0 Applicable Law
The Plan and the terms and conditions of participation
in the Plan, shall be construed and administered according
to the laws of the State of New Jersey to the extent that
those laws are not preempted by the laws of the United
States of America.
ARTICLE TWENTY-THREE - OTHER PLANS
23.0 Other Plans
Nothing contained in this Plan shall prevent the
Company from establishing other benefit plans in which
Employees thereof may also participate.