ORBITAL SCIENCES CORPORATION
1990 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
ARTICLE I
PURPOSE OF PLAN
The purpose of this 1990 Stock Option Plan for
Non-Employee Directors is to promote the growth and profitability
of Orbital Sciences Corporation by providing, through the
ownership of Shares, incentives to attract and retain non-
employee directors who are in a position to make significant
contributions to the success of the Company and other
Participating Companies and to reward such directors for such
contributions.
ARTICLE II
DEFINITIONS
For the purposes of the Plan, the following terms shall
have the meanings set forth in this Article II:
2.01 Board. The term "Board" shall mean the Board of
Directors of the Company.
2.02 Committee. The term "Committee" shall mean a
committee appointed by the Board pursuant to Section 3.04 and
constituting not less than three (3) members of the Board.
2.03 Company. The term "Company" shall mean Orbital
Sciences Corporation, a Delaware corporation, or any successor
thereof.
2.04 Director. The term "Director" shall mean a member of
the Board, or a member of the board of directors of any
Participating Company.
2.05 Effective Date. The term "Effective Date" shall mean
August 2, 1990.
2.06 Eligible Director. The term "Eligible Director" shall
mean any Director who is not an employee of the Company or any
Participating Company and is not a holder of more than two
percent (2%) of the outstanding Shares, nor a person who is an
affiliate of any such holder.
2.07 Exchange Act. The term "Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
2.08 Fair Market Value. The term "Fair Market Value," when
used with respect to the determination of the option price of
Options, shall mean the closing sale price of outstanding Shares
on the national securities exchange on which outstanding Shares
are then principally traded or, if that measure of price is not
available, on a composite index of such exchanges or, if that
measure of price is not available, in a national market system on
which outstanding Shares are quoted on the date of the grant of
the Option. In the event that there are no sales of outstanding
Shares on any such exchange or market on such date of the grant
of the Option, the fair market value of Shares on the date of the
grant shall be deemed to be the closing sales price on the next
preceding day on which outstanding Shares were sold on any such
exchange or market. In the event that Shares are not listed or
quoted on any such exchange or market on such date of the grant
of the Option, a reasonable valuation of the fair market value of
the Shares on the date of the grant shall be made by the Board.
2.09 I.R.C. The term "I.R.C." shall mean the Internal
Revenue Code of 1986, as it has been or may be amended from time
to time.
2.10 Incentive Stock Option. The term "Incentive Stock
Option" shall mean any Option intended to satisfy the
requirements under I.R.C. Section 422(b) as an incentive stock
option.
2.11 Nonstatutory Stock Option. The term "Nonstatutory
Stock Option" shall mean any Option granted under the Plan that
does not qualify as an Incentive Stock Option.
2.12 Option. The term "Option" shall mean an option to
acquire Shares granted under the Plan.
2.13 Optionee. The term "Optionee" shall mean an Eligible
Director who has been granted Options.
2.14 Parent Corporation. The term "Parent Corporation"
shall mean a corporation as defined in I.R.C. Section 425(e).
2.15 Participating Company. The term "Participating
Company" shall mean the Company and any Parent Corporation or
Subsidiary Corporation.
2.16 Plan. The term "Plan" shall refer to the 1990 Stock
Option Plan for Non-Employee Directors of the Company set forth
herein that provides for the granting of Nonstatutory Stock
Options.
2.17 Securities Act. The term "Securities Act" shall mean
the Securities Act of 1933, as amended.
2.18 Shares. The term "Shares" shall mean shares of the
Company's authorized Common Stock, $0.01 par value, and may be
unissued shares or treasury shares or shares purchased for
purposes of the Plan.
2.19 Subsidiary Corporation. The term "Subsidiary
Corporation" shall mean a corporation as defined in I.R.C.
Section 425(f).
2.20 Terminating Transaction. The term "Terminating
Transaction" shall mean any of the following events: (a) the
dissolution or liquidation of the Company; (b) a reorganization,
merger or consolidation of the Company with one or more other
corporations as a result of which the Company goes out of
existence or becomes a subsidiary of another corporation (which
shall be deemed to have occurred if another corporation shall
own, directly or indirectly, eighty percent (80%) or more of the
aggregate voting power of all outstanding equity securities of
the Company); (c) a sale of substantially all of the Company's
assets; or (d) a sale to one person (or two or more persons
acting in concert) of equity securities of the Company
representing eighty percent (80%) or more of the aggregate voting
power of all outstanding equity securities of the Company. As
used herein or elsewhere in this Plan, the word "person" shall
mean an individual, corporation, partnership, association or
other person or entity, or any group of two or more of the
foregoing that have agreed to act together.
2.21 Termination Date. The term "Termination Date" shall
mean August 2, 2000.
2.22 Total Disability. The term "Total Disability" shall
mean a total and permanent disability as that term is defined in
I.R.C. Section 22(e)(3).
ARTICLE III
ADMINISTRATION OF PLAN
3.01 Administration by Board. The Plan shall be
administered by the Board. The Board shall have full and
absolute power and authority in its sole discretion (a) to grant
Options in accordance with the Plan to Eligible Directors; (b) to
prescribe the form or forms of instruments evidencing Options and
any other instruments required under the Plan and to change such
forms from time to time; (c) to adopt, amend and rescind rules
and regulations for the administration of the Plan; and (d) to
interpret the Plan and to decide any questions and settle all
controversies and disputes that may arise in connection with the
Plan.
3.02 Rules and Regulations. The Board may adopt such rules
and regulations as the Board may deem necessary or appropriate to
carry out the purposes of the Plan and shall have authority to do
everything necessary or appropriate to administer the Plan.
3.03 Binding Authority. All decisions, determinations,
interpretations or other actions by the Board shall be final,
conclusive and binding on all parties and on their successors-in-
interest.
3.04 Administration by Committee. The Board, in its sole
discretion, may, from time to time, appoint a Committee to
administer the Plan and exercise all of the powers, authority and
discretion of the Board under the Plan, other than the power and
authority to amend and terminate the Plan under Section 7.01.
ARTICLE IV
NUMBER OF SHARES AVAILABLE FOR GRANT
Subject to the provisions of this Article IV and
Section 6.08(a), the maximum aggregate number of Shares which may
be optioned and sold under the Plan is 170,000. In the event
that outstanding Options shall, for any reason, terminate, lapse,
be forfeited or expire without being exercised, the Shares
subject to such unexercised Options shall again be available for
the granting of Options. In the event that Shares that were
previously issued by the Company upon exercise of an Option are
reacquired by the Company as part of the consideration received
(in accordance with Section 6.05(b) hereof) upon the subsequent
exercise of an Option, such reacquired Shares shall again be
available for the granting of Options.
ARTICLE V
TERM OF PLAN
The Plan shall be effective as of the Effective Date
and shall terminate on the Termination Date. No Option may be
granted after the Termination Date.
ARTICLE VI
OPTION TERMS
6.01 Number of Options Shares and Form of Option Agreement.
Each Eligible Director shall be granted a Nonstatutory Stock
Option for two thousand (2,000) Shares on August 2, 1991. In
addition, each Eligible Director shall be granted a Nonstatutory
Stock Option for two thousand (2,000) Shares on January 2, 1991
and on each anniversary thereafter through January 2, 1995, and
three thousand (3,000) Shares on January 2, 1996 and on each
anniversary thereafter, provided that such individual is then an
Eligible Director. Any Option granted shall be evidenced by an
agreement ("Option Agreement") in such form as the Board, in its
discretion, may, from time to time, approve. Any Option
Agreement shall contain such terms and conditions as the Board
may deem necessary or appropriate and which are not inconsistent
with the provisions of the Plan.
6.02 Option Exercise Price. The option exercise price for
Shares covered by Options shall be the Fair Market Value of the
Shares.
6.03 Vesting and Exercisability of Options. Subject to the
limitations set forth herein and/or in any applicable Option
Agreement entered into hereunder, Options granted shall vest and
be exercisable in accordance with the rules set forth in this
Section 6.03:
(a) General. Subject to the other provisions of this
Section 6.03, Options shall vest and become exercisable in
accordance with the following formula:
(i) Options granted on August 2, 1990 shall
become exercisable to the extent of one hundred percent
(100%) of the Shares covered thereby on January 2, 1991; and
(ii) Options granted after August 2, 1990 shall
become exercisable as to one hundred percent (100%) of the
Shares covered thereby on the first anniversary of the date
of grant.
(b) Termination of Options. All installments of an
Option shall expire and terminate ten (10) years from the day
before the date such Option was granted (the "Option Termination
Date").
(c) Termination of Directorship other than by Death or
Total Disability. In the event that an Optionee ceases to be a
Director for any reason (other than death or Total Disability),
any Options held by such Optionee that have not vested and become
exercisable as of the directorship termination date shall expire
and become unexercisable as of the directorship termination date.
All vested and exercisable Options as of the directorship
termination date shall expire and become unexercisable as of the
earlier of (i) three (3) months following the directorship
termination date or (ii) the original Option Termination Date.
For purposes of the Plan, an Optionee who is a Director of any
Participating Company shall not be deemed to have incurred a
termination of his directorship so long as such Optionee is a
Director of any Participating Company.
(d) Death or Total Disability of Optionee while a
Director. In the event that the directorship of an Optionee with
a Participating Company is terminated by reason of death or Total
Disability, any vested and exercisable Options held by such
Optionee shall expire and become unexercisable as of the earlier
of (i) the applicable Option Termination Date or (ii) the first
anniversary of the date of termination of directorship of such
Optionee by reason of the Optionee's death or Total Disability.
Any such vested and exercisable Options may be
exercised prior to their expiration only by the person or persons
to whom the Optionee's Option rights pass by will or the laws of
descent and distribution. Any Options held by such a deceased or
disabled Optionee that are not vested and exercisable as of the
date of the Director's termination of directorship due to death
or Total Disability shall expire and become unexercisable as of
the directorship termination date.
(e) Termination of Affiliation of Participating
Company. Notwithstanding the foregoing provisions of this
Section 6.03, in the case of an Optionee who is a Director of a
Participating Company other than the Company, upon an Affiliation
Termination (as defined herein) of such Participating Company,
such Optionee shall be deemed (for all purposes of the Plan) to
have incurred a termination of his directorship for reasons other
than death or Total Disability, with such termination to be
deemed effective as of the effective date of said Affiliation
Termination. As used herein, the term "Affiliation Termination"
shall mean, with respect to a Participating Company, the
termination of such Participating Company's status as a
Participating Company.
6.04 Exercise of Options. Options may be exercised, in
whole or in part, by giving written notice of exercise to the
Company, which notice shall specify the number of Shares to be
purchased and shall be accompanied by payment in full of the
purchase price in accordance with Section 6.05. An Option shall
be deemed exercised when such written notice of exercise has been
received by the Company. No Shares shall be issued until full
payment has been made and the Optionee has satisfied such other
conditions as may be required by the Plan, as may be required by
applicable laws, rules or regulations, or as may be adopted or
imposed by the Board. Until the issuance of stock certificates,
no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to optioned Shares
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 6.08(a).
6.05 Payment of Option Exercise Price.
(a) Except as otherwise provided in Section 6.05(b),
the entire option exercise price shall be paid at the time the
Option is exercised by cashier's check or such other means as
deemed acceptable by the Company.
(b) An Optionee may elect to pay for all or some of
the Optionee's Shares with Shares to which the Optionee has a
right at the time of the exercise by the Optionee, including
Shares to which the Optionee has obtained a right by previous
exercise, subject to all restrictions and limitations of
applicable laws, rules and regulations and subject to the
satisfaction of any conditions the Board may impose, including,
but not limited to, the making of such representations and
warranties and the providing of such other assurances that the
Board may require with respect to the Optionee's title to the
Shares used for payment of the exercise price. Such payment
shall be made by delivery of certificates representing Shares,
duly endorsed or with duly signed stock power attached, such
Shares to be valued at the last reported sale price of the Shares
on a national securities exchange or national market system on
the date immediately preceding the day notice of exercise is
received by the Company or, if such Shares are not then listed or
quoted on such an exchange or market, on such basis as the Board
shall determine.
6.06 Options Not Transferable. Options granted under the
Plan may not be sold, pledged, hypothecated, assigned,
encumbered, gifted or otherwise transferred or alienated in any
manner, either voluntarily or involuntarily by operation of law,
other than by will or the laws of descent and distribution, and
may be exercised during the lifetime of an Optionee only by such
Optionee.
6.07 Restrictions on Issuance of Shares.
(a) No Shares shall be issued or delivered upon
exercise of an Option unless and until there shall have been
compliance with all applicable requirements of the Securities
Act, all applicable listing or similar requirements of any
national securities exchange or national market system on which
Shares are then listed or quoted, and any other requirement of
law or of any regulatory body having jurisdiction over such
issuance and delivery. The inability of the Company to obtain
any required permits, authorizations or approvals necessary for
the lawful issuance and sale of any Shares hereunder on terms
deemed reasonable by the Board shall relieve the Company, the
Board and any Committee of any liability in respect of the non-
issuance or sale of such Shares as to which such requisite
permits, authorizations or approvals shall not have been
obtained.
(b) As a condition to the granting or exercise of any
Option, the Board may require the person receiving or exercising
such Option to make any representation and/or warranty to the
Company as may be required under any applicable law or
regulation, including, but not limited to, a representation that
the Option and/or Shares are being acquired only for investment
and without any present intention to sell or distribute such
Option and/or Shares, if such a representation is required under
the Securities Act or any other applicable law, rule or
regulation.
(c) The grant of Options prior to approval of the Plan
by the affirmative vote or written consent of a majority of the
holders of outstanding Shares represented and voting at a meeting
or by written consent is conditioned on such approval being
obtained within twelve (12) months of the adoption of the Plan.
In the event such stockholder approval is not obtained within
such time period, any outstanding Options shall be void.
6.08 Option Adjustments.
(a) If the outstanding Shares are increased,
decreased, changed into or exchanged for a different number or
kind of shares of the Company through reorganization,
recapitalization, reclassification, stock dividend, stock split
or reverse stock split, upon authorization of the Board, a
proportionate adjustment shall be made in the number or kind of
shares and the per-share option price thereof, which may be
issued in the aggregate and to individual Optionees upon exercise
of Options; provided, however, that no such adjustment need be
made if, upon the advice of counsel, the Board determines that
such adjustment may result in the receipt of federally taxable
income to holders of outstanding Options or the holders of Common
Stock or other classes of the Company's securities.
(b) In the event of any Terminating Transaction, all
outstanding Options shall become exercisable prior to the
consummation of such Terminating Transaction and the Board shall
take all necessary actions to ensure that such Options remain
exercisable for a period of at least twenty (20) days prior to
the consummation. Upon consummation of the Terminating
Transaction, all outstanding Options shall terminate and cease to
be exercisable. There shall be excluded from the operation of
the provisions of this Section 6.08(b) any Terminating
Transaction in which: (i) the holders of outstanding Shares
prior to the Terminating Transaction retain or acquire securities
constituting a majority of the outstanding voting common stock of
the acquiring or surviving corporation or other entity; and
(ii) no single person owns more than half of the outstanding
voting common stock of the acquiring or surviving corporation or
other entity. For purposes of this Section 6.08(b), voting
common stock of the acquiring or surviving corporation or other
entity, upon exercise of warrants or options, shall be considered
outstanding, and all securities that vote in the election of
directors (other than solely as the result of a default in the
making of any dividend or other payment) shall be deemed to
constitute that number of shares of voting common stock that is
equivalent to the number of such votes that may be cast by the
holders of such securities.
Notwithstanding the foregoing, in the event that any
person or group of persons commences a tender offer for
outstanding Shares within the scope of Regulation 14D under the
Exchange Act, all outstanding Options shall become immediately
exercisable. Any Shares received upon this accelerated exercise
that are not purchased pursuant to the offer (whether by failure
of the offer or otherwise) shall be subject to repurchase at the
exercise price by the Company upon termination of the Optionee's
service as a Director, in accordance with the vesting schedule
that corresponds to the schedule of exercisability for the Option
under which the Shares were acquired.
(c) To the maximum extent possible, any adjustments
authorized under this Section 6.08 with respect to any
outstanding Options shall be made by means of appropriate
adjustments to the number of Shares (or other securities) and the
option exercise price therefor under the unexercised portions of
such outstanding Options, but without changing the aggregate
exercise price applicable to said unexercised portions. In all
cases, the nature and extent of adjustments under this Section
6.08 shall be determined by the Board in its sole discretion, and
any such determination as to what adjustments shall be made, and
the extent thereof, shall be final and binding. No fractional
shares of stock shall be issued under the Plan pursuant to any
such adjustment.
6.09 Taxes. The Board shall make such provisions and take
such steps as it deems necessary or appropriate for the
withholding of any federal, state, local and other tax required
by law to be withheld with respect to the grant or exercise of an
Option, or with respect to the disposition of Shares acquired
pursuant to the exercise of an Option pursuant to the Plan,
including, but not limited to, the deduction of the amount of any
such withholding tax from any compensation or other amounts
payable to an Optionee by any member of the Participating
Companies, or requiring an Optionee (or the Optionee's
beneficiary or legal representative), as a condition of granting
or exercising an Option, to pay to any member of the
Participating Companies any amount required to be withheld, or to
execute such other documents as the Board deems necessary or
desirable in connection with the satisfaction of any applicable
withholding obligation. An Optionee may, in lieu of remitting to
the Company amounts sufficient to satisfy federal, state, local
or other withholding tax requirements, direct the Company to
withhold Shares or deliver Shares in each case with a value equal
to such withholding tax requirements.
6.10 Legends on Options and Stock Certificates. Each
Option Agreement and each certificate representing Shares
acquired upon exercise of an Option shall be endorsed with all
legends, if any, required by applicable federal and state
securities laws to be placed on the Option Agreement and/or the
certificate. The determination of which legends, if any, shall
be placed upon Option Agreements and/or said Shares shall be made
by the Board in its sole discretion, and such decision shall be
final and binding.
ARTICLE VII
AMENDMENT OR TERMINATION OF PLAN
The Board may amend, alter and/or terminate the Plan
at any time; provided, however, that no change shall be effective
unless approved by the stockholders of the Company if such change
would cause the Plan to fail to comply with Rule 16b-3 of the
Exchange Act or any successor rule under such Act as in effect on
the date of such amendment; provided, further, that unless
required by applicable law, rule or regulation, no amendment of
the Plan shall affect in a material and adverse manner Options
granted prior to the date of any such amendment without the
consent of any Optionee holding any such affected Options; and
provided, further, that the provisions of Sections 6.01, 6.02 and
6.03 shall not be amended more than once every six (6) months,
other than to comport with changes in the I.R.C., the Employee
Retirement Income Security Act or the rules thereunder.
ARTICLE VIII
GENERAL PROVISIONS
8.01 Availability of the Plan. A copy of the Plan shall be
delivered to the Secretary of the Company and shall be shown by
the Secretary to any Eligible Director making reasonable inquiry
concerning the Plan.
8.02 Notice. Any notice or other communication required or
permitted to be given pursuant to the Plan or under any Option
Agreement must be in writing and may be given by registered or
certified mail and, if given by registered or certified mail,
shall be determined to have been given and received when a
registered or certified letter containing such notice, properly
addressed with postage prepaid, is deposited in the United States
mails and, if given otherwise than by registered or certified
mail, shall be deemed to have been given when delivered to and
received by the party to whom addressed. Notice shall be given
to Eligible Directors at their most recent addresses shown in the
Company's records. Notice to the Company shall be addressed to
the Company at the address of the Company's principal executive
offices, to the attention of the Secretary of the Company.
8.03 Titles and Headings. Titles and headings of sections
of the Plan are for convenience of reference only and shall not
affect the construction of any provision of the Plan.
8.04 Governing Law. The Plan shall be governed by,
interpreted under and construed and enforced in accordance with
the internal laws, and not the laws pertaining to conflicts or
choice of laws, of the State of Delaware, applicable to
agreements made and to be performed wholly within the State of
Delaware.