EXHIBIT 10.16
UNIROYAL TECHNOLOGY CORPORATION
1992 STOCK OPTION PLAN
AS AMENDED
TO JANUARY 1, 2002
AND RESTATED
UNIROYAL TECHNOLOGY CORPORATION
1992 STOCK OPTION PLAN
I........PURPOSE
Uniroyal Technology Corporation, a Delaware corporation (the
"Company"), desires to afford certain of its key employees and certain key
employees of any subsidiary corporation or parent corporation of the Company now
existing or hereafter formed or acquired who are responsible for the continued
growth of the Company an opportunity to acquire a proprietary interest in the
Company, and thus to create in such key employees an increased interest in and a
greater concern for the welfare of the Company and its subsidiaries.
The stock options ("Options") offered pursuant to this 1992
Stock Option Plan (the "Plan") are a matter of separate inducement and are not
in lieu of any salary or other compensation for the services of any key
employee.
The Company, by means of the Plan, seeks to retain the
services of persons now holding key positions and to secure and retain the
services of persons capable of filling such positions.
The Options granted under the Plan are intended to be either
incentive stock options ("Incentive Options") within the meaning of Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), or options that
do not meet the requirements for Incentive Options ("Non-Qualified Options"),
but the Company makes no warranty as to the qualification of any Option as an
Incentive Option.
II.......AMOUNT OF STOCK SUBJECT TO THE PLAN
The total number of Common Shares of the Company which may be
purchased pursuant to the exercise of Options granted under the Plan shall not
exceed, in the aggregate, 1,363,636 of the currently authorized Common Shares,
$.01 par value per share, of the Company (the "Shares"), such number to be
subject to adjustment in accordance with Article XI of the Plan.
Shares which may be acquired under the Plan may be either
authorized but unissued Shares, Shares of issued stock held in the Company's
treasury, or both, at the discretion of the Company. If and to the extent that
Options granted under the Plan expire or terminate without having been
exercised, the Shares covered by such expired or terminated Options may again be
subject to an Option under the Plan.
Except as provided in Article XXII hereof, the Company shall,
subject to the terms hereinafter set forth, grant:
(a)......on September 27, 1992 (the "Effective Date"), Options
to purchase 340,909 Shares to, and in the amounts set forth opposite
the names of, the key employees of the Company listed in Subsection A
of Annex A attached hereto, provided, however, that, with respect to
each individual listed in Subsection A of Annex A hereto, such
individual must be employed by the Company on the Effective Date and,
(x) if so employed, the Company shall grant the Options to such
individual in accordance with this subparagraph (a) and (y) if not so
employed, any Option that otherwise would be granted to such individual
shall be granted to the new key employee of the Company who
subsequently fills the position formerly occupied by the key employee
listed in Subsection A of Annex A, as of the date such new key employee
occupies the position of the individual listed on Subsection A of Annex
A,
(b)......on the fifteenth (15) day after the earlier of the
date (x) on which the Company releases statements showing the financial
condition and results of operations for the first full fiscal quarter
of the Company following the Effective Date, or (y) which is forty-five
(45) days after the end of the first full fiscal quarter of the Company
following the Effective Date, Options to purchase up to 454,545 Shares
in the aggregate to, and in the amounts set forth opposite the names
of, the key employees of the Company listed in Subsection B of Annex A
hereto; provided, however, that, with respect to each individual listed
in Subsection B of Annex A hereto, such individual must be employed by
the Company on the date of grant and, (x) if so employed, the Company
shall grant the Options to such individual in accordance with this
subparagraph (b) and (y) if not so employed, any Option that otherwise
would be granted to such individual may be granted to key employees of
the Company as determined by the Committee, in its discretion, and
(c)......on or after the first anniversary of the Effective
Date, Options to purchase up to 568,182 Shares in the aggregate to key
employees of the Company as determined by the Committee, in its
discretion.
Subject to the preceding paragraph, and except as provided in
Articles XVIII and XXII hereof, the Company may, from time to time during the
period beginning on the Effective Date and ending on September 27, 2002 (the
"Termination Date"), grant to certain key employees of the Company, or certain
key employees of any subsidiary corporation or parent corporation of the Company
now existing or hereafter formed or acquired, Incentive Options and/or
Non-Qualified Options under the terms hereinafter set forth.
As used in the Plan, the term "parent corporation" and
"subsidiary corporation" shall mean a corporation coming within the definition
of such terms contained in Sections 424(e) and 424(f) of the Code, respectively.
III......ADMINISTRATION
The Plan shall be administered by the Option Committee of the Board of
Directors of the Company (the "Board") or such other committee or subcommittee
as the Board may designate or as shall be formed by the abstention or recusal of
a non-Qualified Member (as defined below) of such committee (the "Committee").
The members of the Committee shall be appointed by, and serve at the pleasure
of, the Board. Except as provided in the last sentence of this Article III, at
all times that the Committee acts in connection with the Plan, the Committee
shall consist solely of Qualified Members, the number of whom shall not be less
than two. A "Qualified Member" is both a "non-employee director" within the
meaning of Rule 16b-3 ("Rule 16b3") promulgated under the Securities Exchange
Act of 1934 (the "Exchange Act") and an "outside director" within the meaning of
section 162(m) of the Code. Solely with respect to the granting and
administration of awards to persons who are not at the time of the grant, and
who are not expected to become, subject to the insider trading restrictions of
Section 16 of the Exchange Act or the limitation on deductible compensation
under Section 162(m) of the Code, the Committee may consist of a single member
of the Board, who need not be a Qualified Member.
Subject to the express provisions of the Plan, the Committee shall have
authority, in its discretion, to determine the persons to whom Options shall be
granted, the time when such persons shall be granted Options, the number of
Shares which shall be subject to each Option, the purchase price of each Share
which shall be subject to each Option, the period(s) during which such Options
shall be exercisable (whether in whole or part), and the other terms and
provisions thereof (which need not be identical). In determining the persons to
whom Options shall be granted and the number of Shares for which Options are to
be granted to each person, the Committee shall give consideration to the length
of service, the amount of earnings and the responsibilities and duties of such
person.
Subject to the express provisions of the Plan, the Committee
also shall have authority to construe the Plan and the Options granted
thereunder, to amend the Plan and the Options granted thereunder, to prescribe,
amend and rescind rules and regulations relating to the Plan, to determine the
terms and provisions of the Options (which need not be identical) and to make
all other determinations necessary or advisable for administering the Plan. The
Committee also shall have the authority to require, in its discretion, as a
condition of the granting of any such Option, that the employee agree (a) not to
sell or otherwise dispose of Shares acquired pursuant to the exercise of such
Option for a period of six (6) months following the date of the acquisition of
such Option and (b) that in the event of termination of employment of such
employee, other than as a result of dismissal without cause, such employee will
not, for a period to be fixed at the time of the grant of the Option, enter into
any other employment or participate directly or indirectly in any other business
or enterprise which is competitive with the business of the Company or any
subsidiary corporation or parent corporation of the Company, or enter into any
employment in which such employee will be called upon to utilize special
knowledge obtained through employment with the Company or any subsidiary
corporation or parent corporation thereof.
The determination of the Committee on matters referred to in
this Article III shall be conclusive.
The Committee may employ such legal or other counsel,
consultants and agents as it may deem desirable for the administration of the
Plan and may rely upon any opinion or computation received from any such
counsel, consultant or agent. Expenses incurred by the Committee in the
engagement of such counsel, consultant or agent shall be paid by the Company. No
member or former member of the Board of Directors, the Executive Committee or
the Committee shall be liable for any action or determination made in good faith
with respect to the Plan or any award of Options granted hereunder.
IV.......ELIGIBILITY
Options may be granted only to salaried key employees of the
Company or any subsidiary corporation or parent corporation of the Company now
existing or hereafter formed or acquired, except as hereinafter provided. Any
person who shall have retired from the active employment by the Company or any
subsidiary corporation or parent corporation of the Company, although such
person shall have entered into a consulting contract with the Company or a
subsidiary corporation or parent corporation of the Company, shall not be
eligible to receive an Option.
The Plan does not create a right in any person to participate
in the Plan, nor does it create a right in any person to have any Options
granted to him or her.
V........OPTION PRICE AND PAYMENT
The price for each Share purchasable under any Option shall be
equal to (i) in the case of an Option granted on the Effective Date to a key
employee of the Company listed on Annex A hereto, (x) if the Shares are publicly
traded within one (1) year after the Effective Date, the average fair market
value per Share during the period commencing on the day that public trading
commences and ending on the twentieth (20) day thereafter, or (y) if the Shares
are not publicly traded, the fair market value per Share at the Effective Date
as determined by Hauser, Richards & Company, as set forth in the Third Amended
Disclosure Statement pursuant to Section 1125 of the Bankruptcy Code With
Respect to Third Amended Plan of Reorganization Under Chapter 11 of the United
States Bankruptcy Code For Polycast Technology Corporation and its Affiliated
Debtors dated May 11, 1992, and in the case of any other Option granted
hereunder, such amount as the Committee shall, in its best judgment, determine
to be one hundred percent (100%) of the fair market value per Share at the date
the Option is granted; provided, however, that in the case of an Incentive
Option granted to a person who, at the time such Option is granted, owns shares
of the Company or any subsidiary corporation or parent corporation of the
Company possessing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or of any subsidiary corporation or
parent corporation of the Company, the purchase price for each Share shall be
such amount as the Committee, in its best judgment, shall determine to be not
less than one hundred ten percent (110%) of the fair market value per Share at
the date the Option is granted. In determining the stock ownership of an
employee for any purpose under the Plan, the rules of Section 424(d) of the Code
shall be applied, and the Committee may rely on representations of fact made to
it by the employee and believed by it to be true.
If the Shares are listed on a national securities exchange in
the United States on any date on which the fair market value per Share is to be
determined, the fair market value per Share shall be deemed to be the closing
quotation at which such Shares are sold on such national securities exchange on
the date such Option is granted. In the event that the Shares are listed on a
national securities exchange in the United States on such date but the Shares
are not traded on such date, or such national securities exchange is not open
for business on such date, the fair market value per Share shall be determined
as of the closest preceding date on which such exchange shall have been open for
business and the Shares were traded. If the Shares are listed on more than one
national securities exchange in the United States on the date any such Option is
granted, the Committee shall determine which national securities exchange shall
be used for the purpose of determining the fair market value per Share.
If on the date any Option is granted a public market exists
for the Shares but such Shares are not listed on a national securities exchange
in the United States, the fair market value per Share shall be deemed to be the
average of the closing bid and asked quotations in the over-the-counter market
for such Shares in the United States on the date such Option is granted. In the
event that there are no bid and asked quotations in the over-the-counter market
in the United States for such Shares on the date such Option is granted, the
fair market value per Share shall be deemed to be the average of the closing bid
and asked quotations in the over-the-counter market in the United States for
such shares on the closest date preceding the date such Option is granted for
which such quotations are available.
For purposes of this Plan, the determination by the Committee
of the fair market value of a Share shall be conclusive.
Upon the exercise of an Option granted hereunder, the Company
shall cause the purchased Shares to be issued only when it shall have received
the full purchase price for the Shares in cash; provided, however, that in lieu
of cash, the holder of an Option may, to the extent permitted by applicable law,
exercise an Option (a) in whole or in part, by delivering to the Company Common
Shares of the Company (in proper form for transfer and accompanied by all
requisite stock transfer tax stamps or cash in lieu thereof) owned by such
holder having a fair market value equal to the cash exercise price applicable to
that portion of the Option being exercised by the delivery of such shares, the
fair market value of Common Shares so delivered to be determined as of the date
immediately preceding the date on which the Option is exercised, or as may be
required in order to comply with or to conform to the requirements of any
applicable laws or regulations, (b) in whole or in part, by delivering to the
Company authorization for the immediate sale of the Common Shares of the Company
that will be purchased by exercise of the Option and retention by Company of
such sale or liquidation proceeds (accompanied by all requisite authorizations
as legal counsel for the Company deem necessary) with respect to such numbers of
shares having a fair market value equal to the cash exercise price applicable to
that portion of the Option being exercised by holder, the fair market value of
Common Shares to be so purchased and sold to be determined as of the date
immediately preceding the date on which the Option is exercised, or as may be
required in order to comply with or to conform to the requirements of any
applicable laws or regulations, or (c) in part, by delivering to the Company an
executed promissory note on such terms and conditions as the Committee shall
determine, at the time of grant, in its discretion; provided, however, that (i)
the principal amount of such note shall not exceed ninety percent (90%) (or such
lesser percentage as would be permitted by applicable margin regulations) of the
aggregate purchase price of the Shares then being purchase pursuant to the
exercise of such Option and (ii) payment for shares with a promissory note is
permissible under applicable law.
VI.......TERM OF OPTIONS AND LIMITATIONS ON THE
RIGHT OF EXERCISE
Any Option granted hereunder shall be exercisable at such
times, in such amounts and during such period or periods as the Committee shall
determine at the date of the grant of such Option; provided, however, that an
Incentive Option shall not be exercisable after the expiration of ten (10) years
from the date such Option is granted; provided, further, that in the case of an
Incentive Option granted to a person who, at the time such Incentive Option is
granted, owns stock of the Company or any subsidiary corporation or parent
corporation of the Company possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of any
subsidiary corporation or parent corporation of the Company, such Incentive
Option shall not be exercisable after the expiration of five (5) years from the
date such Incentive Option is granted.
Notwithstanding anything contained herein to the contrary, the
Committee shall, in the case of Options granted on the dates set forth in
Article II to the key employees of the Company listed in Subsections A and B of
Annex A hereto, cause each such Option (x) to become exercisable on the first
day of the month which is eighteen (18) months after the first full month
following the Effective Date, to the extent of sixty percent (60%) of the total
number of Shares covered thereby, and (y) to become exercisable on the first day
of the month which is thirty-six (36) months after the first full month
following the Effective Date, to the extent of the remaining Shares covered
thereby.
The Committee shall have the right to accelerate, in whole or
in part, from time to time, conditionally or unconditionally, rights to exercise
any Option granted hereunder.
To the extent that an Option is not exercised within the
period of exercisability specified therein, it shall expire as to the then
unexercised part.
Except to the extent otherwise provided under the Code, to the
extent that the aggregate fair market value of stock for which Incentive Options
(under all stock option plans of the Company and of any parent corporation or
subsidiary corporation of the Company) are exercisable for the first time by an
employee during any calendar year exceeds $100,000, such Options shall be
treated as Non-Qualified Options. For purposes of this limitation, (a) the fair
market value of stock is determined as of the time the Option is granted, and
(b) the limitation will be applied by taking into account Options in the order
in which they were granted.
In no event shall an Option granted hereunder be exercised for
a fraction of a Share.
A person entitled to receive Shares upon the exercise of an
Option shall not have the rights of a stockholder with respect to such Shares
until the date of issuance of a stock certificate to such person for such
Shares; provided, however, that until such stock certificate is issued, any
holder of an Option using previously acquired Shares in payment of an option
exercise price shall continue to have the rights of a stockholder with respect
to such previously acquired Shares.
VII......TERMINATION OF EMPLOYMENT
Upon termination of employment of any employee of the Company
and all subsidiary corporations and parent corporations of the Company, any
Option previously granted to the employee, unless otherwise specified by the
Committee in the Option, shall, to the extent not theretofore exercised,
terminate and become null and void; provided, however, that:
(a) if the employee shall die while in the employ of such
corporation or during either the three (3) month or one (1) year
period, whichever is applicable, specified in clause (b) below and at a
time when such employee was entitled to exercise an Option as herein
provided, the legal representative of such employee, or such person who
acquired such Option by bequest or inheritance or by reason of the
death of the employee, may, not later than one (1) year from the date
of death, exercise such Option, to the extent not theretofore
exercised, in respect of any or all of such number of Shares as
specified by the Committee in such Option; and
(b) if the employment of any employee to whom such Option
shall have been granted shall terminate by reason of the employee's
retirement (at such age or upon such conditions as shall be specified
by the Committee), disability (as described in Section 22(e)(3) of the
Code) or dismissal by the employer other than for cause (as defined
below), and while such employee is entitled to exercise such Option as
herein provided, such employee shall have the right to exercise such
Option so granted in respect of any or all of such number of Shares as
specified by the Committee in such Option, at any time up to and
including (i) three (3) months after the date of such termination of
employment in the case of termination by reason of retirement or
dismissal other than for cause, and (ii) one (1) year after the date of
termination of employment in the case of termination by reason of
disability.
In no event, however, shall any person be entitled to exercise
any Option after the expiration of the period of exercisability of such Option,
as specified therein.
If an employee voluntarily terminates his or her employment,
or is discharged for cause, any Option granted hereunder shall, unless otherwise
specified by the Option Committee in the Option, forthwith terminate with
respect to any unexercised portion thereof.
If an Option granted hereunder shall be exercised by the legal
representative of a deceased grantee or by a person who acquired an Option
granted hereunder by bequest or inheritance or by reason of the death of any
employee or former employee, written notice of such exercise shall be
accompanied by a certified copy of letters testamentary or equivalent proof of
the right of such legal representative or other person to exercise such Option.
For the purposes of the Plan, the term "for cause" shall mean
(a) with respect to an employee who is a party to a written employment agreement
with, or, alternatively, participates in a compensation or benefit plan of the
Company or a subsidiary corporation or parent corporation of the Company, which
agreement or plan contains a definition of "for cause" or "cause" (or words of
like import) for purposes of termination of employment thereunder by the Company
or such subsidiary corporation or parent corporation of the Company, "for cause"
or "cause" as defined therein; or (b) in all other cases, (i) the willful
commission by an employee of an act that causes or may cause substantial damage
to the Company or a subsidiary corporation or parent corporation of the Company;
(ii) the commission by an employee of an act of fraud in the performance of such
employee's duties on behalf of the Company or a subsidiary corporation or parent
corporation of the Company; (iii) conviction of the employee for commission of a
felony in connection with the performance of his duties on behalf of the Company
or a subsidiary corporation or parent corporation of the Company, or (iv) the
continuing failure of an employee to perform the duties of such employee to the
Company or a subsidiary corporation or parent corporation of the Company after
written notice thereof and a reasonable opportunity to be heard and cure such
failure are given to the employee by the Committee.
For the purposes of the Plan, an employment relationship shall
be deemed to exist between an individual and a corporation if, at the time of
the determination, the individual was an "employee" of such corporation for
purposes of Section 422 of the Code. If an individual is on leave of absence
taken with the consent of the corporation by which such individual was employed,
or is on active military service, and is determined to be an "employee" for
purposes of the exercise of an Option, such individual shall not be entitled to
exercise such Option during such period and while the employment is treated as
continuing intact unless such individual shall have obtained the prior written
consent of such corporation, which consent shall be signed by the chairman of
the board of directors, the president, a vice-president or other duly authorized
officer of such corporation.
A termination of employment shall not be deemed to occur by
reason of (i) the transfer of an employee from employment by the Company to
employment by a subsidiary corporation or a parent corporation of the Company,
(ii) the transfer of an employee from employment by a subsidiary corporation or
a parent corporation of the Company to employment by the Company or by another
subsidiary corporation or parent corporation of the Company, or (iii) a layoff
or furlough of the employee.
VIII. EXERCISE OF OPTIONS
Options granted under the Plan shall be exercised by the
optionee as to all or part of the Shares covered thereby by the giving of
written notice of the exercise thereof to the Corporate Secretary of the Company
at the principal business office of the Company, specifying the number of Shares
to be purchased and accompanied by payment of the purchase price. Subject to the
terms of Articles XIII, XIV and XVI hereof, the Company shall cause certificates
for the Shares so purchased to be delivered at the principal business office of
the Company, against payment of the full purchase price, on the date specified
in the notice of exercise.
IX. .....USE OF PROCEEDS
The cash proceeds of the sale of Shares subject to the Options
granted hereunder are to be added to the general funds of the Company and used
for its general corporate purposes as the Board of Directors shall determine.
X. ......NONTRANSFERABILITY OF OPTIONS
No Option granted hereunder shall be transferable, whether by
operation of law or otherwise, other than by will or the laws of descent and
distribution, and any Option granted hereunder shall be exercisable, during the
lifetime of the holder, only by such holder. Except to the extent provided
above, Options may not be assigned, transferred, pledged, hypothecated or
disposed of in any way (whether by operation of law or otherwise) and shall not
be subject to execution, attachment or similar process.
XI.......ADJUSTMENT OF SHARES; EFFECT OF CERTAIN TRANSACTIONS
Notwithstanding any other provision contained herein, in the
event of any change in the Shares subject to the Plan or to any Option granted
under the Plan (through merger, consolidation, reorganization, recapitalization,
stock dividend, stock split, split-up, split-off, spin-off, combination of
shares, exchange of shares, or other like change in capital structure of the
Company), an adjustment shall be made to each outstanding Option such that each
such Option shall thereafter be exercisable for such securities, cash and/or
other property as would have been received in respect of the Shares subject to
such Option had such Option been exercised in full immediately prior to such
change, and such an adjustment shall be made successively each time any such
change shall occur. The term "Shares" after any such change shall refer to the
securities, cash and/or property then receivable upon exercise of an Option. In
addition, in the event of any such change, the Committee shall make any further
adjustment to the maximum number of Shares which may be acquired under the Plan
pursuant to the exercise of Options, the maximum number of shares for which
Options may be granted to any one employee of the Company, and the number of
Shares and price per Share subject to outstanding Options as shall be equitable
to prevent dilution or enlargement of rights under such Options, and the
determination of the Committee as to these matters shall be conclusive;
provided, however, that (a) each such adjustment with respect to an Incentive
Option shall comply with the rules of Section 424(a) of the Code (or any
successor provision), and (b) in no event shall any adjustment be made which
would render any Incentive Option granted hereunder other than an "incentive
stock option" as defined in Section 422 of the Code.
In the event of a "change in control" of the Company, all then
outstanding Options shall immediately become exercisable. For purposes of the
Plan, a "change in control" of the Company occurs if (a) more than fifty percent
(50%) of the total combined voting power of all classes of stock of the Company
normally entitled to vote for the election of directors of the Company is
acquired by another person, firm or corporation or by a cooperating group of
such individuals or entities, (b) the Board of Directors approves the sale of
all or substantially all of the property or assets of the Company, or (c) the
Board of Directors approves a consolidation or merger of the Company with
another corporation, the consummation of which would result in the occurrence of
an event described in clause (a) above.
Notwithstanding anything contained herein to the contrary, the
Committee, in its discretion, may determine that, upon the occurrence of a
transaction described in the preceding paragraph, each Option outstanding
hereunder shall terminate within a specified number of days after notice to the
holder, and such holder shall receive, with respect to each Share subject to
such Option, an amount equal to the excess of the fair market value of such
Shares immediately prior to the occurrence of such transaction over the exercise
price per Share of such Option; such amount shall be payable in cash, in one or
more of the kinds of property payable in such transaction, or in a combination
thereof, as the Committee in its discretion shall determine. The provisions
contained in the preceding sentence shall be inapplicable to an Option granted
within six (6) months before the occurrence of a transaction described above if
the holder of such Option is subject to the reporting requirements of Section
16(a) of the Exchange Act.
XII......RIGHT TO TERMINATE EMPLOYMENT
The Plan shall not impose any obligation on the Company or on
any subsidiary corporation or parent corporation thereof to continue the
employment of any holder of an Option and it shall not impose any obligation on
the part of any holder of an Option to remain in the employ of the Company or of
any subsidiary corporation or parent corporation thereof.
XIII. PURCHASE FOR INVESTMENT
Except as hereinafter provided, the Committee may require the
holder of an Option granted hereunder, as a condition of exercise of such
Option, to execute and deliver to the Company a written statement, in form
satisfactory to the Committee, in which such holder represents and warrants that
such holder is purchasing or acquiring the Shares acquired thereunder for such
holder's own account, for investment only and not with a view to the resale or
distribution thereof, and agrees that any subsequent resale or distribution of
any of such Shares shall be made only pursuant to either (i) a Registration
Statement on an appropriate form under the Securities Act of 1933, as amended
(the "Securities Act"), which Registration Statement has become effective and is
current with regard to the Shares being sold, or (ii) a specific exemption from
the registration requirements of the Securities Act, but in claiming such
exemption the holder shall, prior to any offer of sale or sale of such Shares,
obtain a prior favorable written opinion of counsel, in form and substance
satisfactory to counsel for the Company, as to the application of such exemption
thereto. The foregoing restriction shall not apply to (x) issuances by the
Company so long as the Shares being issued are registered under the Securities
Act and a prospectus in respect thereof is current or (y) reofferings of Shares
by affiliates of the Company (as defined in Rule 405 or any successor rule or
regulation promulgated under the Securities Act) if the Shares being reoffered
are registered under the Securities Act and a prospectus in respect thereof is
current.
Nothing herein shall be construed as requiring the Company to
register Shares subject to any Option under the Securities Act. In addition, if
at any time the Committee shall determine that the listing or qualification of
the Shares subject to such Option on any securities exchange or under any
applicable law, or the consent or approval of any governmental regulatory body,
is necessary or desirable as a condition of, or in connection with, the granting
of an Option, or the issuance of Shares thereunder, such Option may not be
exercised in whole or in part unless such listing, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Committee.
XIV......ISSUANCE OF STOCK CERTIFICATES; LEGENDS, PAYMENT
OF EXPENSES
Upon any exercise of an Option which may be granted hereunder
and payment of the purchase price in respect thereof, a certificate or
certificates for the Shares shall be issued by the Company in the name of the
person exercising the Option and shall be delivered to or upon the order of such
person.
The Company may endorse such legend or legends upon the
certificates for Shares issued pursuant to the Plan and may issue such "stop
transfer" instructions to its transfer agent in respect of such Shares as the
Committee, in its discretion, determines to be necessary or appropriate to (a)
prevent a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act, (b) implement the provisions of the Plan and
any agreement between the Company and the optionee or grantee with respect to
such Shares, or (c) permit the Company to determine the occurrence of a
disqualifying disposition, as described in Section 421(b) of the Code, of Shares
transferred upon exercise of an Incentive Option granted under the Plan.
The Company shall pay all issue or transfer taxes with respect
to the issuance or transfer of Shares, as well as all fees and expenses
necessarily incurred by the Company in connection with such issuance or
transfer, except fees and expenses which may be necessitated by the filing or
amending of a Registration Statement under the Securities Act, which fees and
expenses shall be borne by the recipient of the Shares unless such Registration
Statement has been filed by the Company for its own corporate purposes (and the
Company so states) in which event the recipient of the Shares shall bear only
such fees and expenses as are attributable to the inclusion of the Shares he or
she receives in the Registration Statement.
All Shares issued as provided herein shall be fully paid and
nonassessable to the extent permitted by law.
XV.......WITHHOLDING TAXES
The Company may require an employee exercising a Non-Qualified
Option granted hereunder, or disposing of Shares acquired pursuant to the
exercise of an Incentive Option in a disqualifying disposition (within the
meaning of Section 421(b) of the Code), to reimburse the corporation that
employs such employee for any taxes required by any government to be withheld or
otherwise deducted and paid by such corporation in respect of the issuance or
disposition of such Shares. In lieu thereof, the corporation that employs such
employee shall have the right to withhold the amount of such taxes from any
other sums due or to become due from such corporation to the employee upon such
terms and conditions as the Committee shall prescribe. The corporation that
employs such employee may, in its discretion, hold the stock certificate to
which such employee is entitled upon the exercise of an Option as security for
the payment of such withholding tax liability, until cash sufficient to pay that
liability has been accumulated. In addition, at any time that the Company
becomes subject to a withholding obligation under applicable law with respect to
the exercise of a Non-Qualified Option (the "Tax Date"), except as set forth
below, a holder of a Non-Qualified Option may elect to satisfy, in whole or in
part, the holder's related personal tax liabilities (an "Election") by (a)
directing the Company to withhold from Shares issuable in the related exercise
either a specified number of Shares or Shares having a specified value (in each
case not in excess of the related personal tax liabilities), (b) tendering
Shares previously issued pursuant to the exercise of an Option or other shares
of the Company's common stock owned by the holder or (c) combining any or all of
the foregoing options in any fashion. An Election shall be irrevocable. The
withheld Shares and other Shares tendered in payment shall be valued at their
fair market value (determined in accordance with the principles set forth in
Article V hereof) on the Tax Date. The Committee may disapprove of any Election,
suspend or terminate the right to make Elections or provide that the right to
make Elections shall not apply to particular Shares or exercises. The Committee
may impose any additional conditions or restrictions on the right to make an
Election as it shall deem appropriate. In addition, the Company shall be
authorized to effect any such withholding upon exercise of a Non-Qualified
Option by retention of shares issuable upon such exercise having a fair market
value at the date of exercise (as determined under Article V) which is equal to
the amount to be withheld; provided, however, that the Company shall not be
authorized to effect such withholding without the prior written consent of the
employee if such withholding would subject such employee to liability under
Section 16(b) of the Exchange Act. The Committee may prescribe such rules as it
determines with respect to employees subject to the reporting requirements of
Section 16(a) of the Exchange Act to effect such tax withholding in compliance
with the Rules established by the Securities and Exchange Commission (the
"Commission") under Section 16 of the Exchange Act and the positions of the
staff of the Commission thereunder expressed in no-action letters exempting such
tax withholding from liability under Section 16(b) of the Exchange Act.
XVI......LISTING OF SHARES AND RELATED MATTERS
The Board of Directors may delay any issuance or delivery of
Shares if it determines that listing, registration or qualification of Shares
covered by the Plan upon any national securities exchange or under any state or
federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the sale or
purchase of Shares under the Plan, until such listing, registration,
qualification, consent or approval shall have been effected or obtained, or
otherwise provided for, free of any conditions not acceptable to the Board of
Directors.
XVII. AMENDMENT OF THE PLAN
The Board of Directors may, from time to time, amend the Plan,
provided that no amendment shall be made, without the approval of the
stockholders of the Company, that will (a) increase the total number of Shares
reserved for Options under the Plan (other than an increase resulting from an
adjustment provided for in Article XI hereof), (b) reduce the exercise price of
any Incentive Option granted hereunder, (c) modify the provisions of the Plan
relating to eligibility, or (d) materially increase the benefits accruing to
participants under the Plan. The Committee shall be authorized to amend the Plan
and the Options granted thereunder to permit the Incentive Options granted
thereunder to qualify as incentive stock options within the meaning of Section
422 of the Code and the Treasury regulations promulgated thereunder. The rights
and obligations under any Option granted before amendment of the Plan or any
unexercised portion of such Option shall not be adversely affected by amendment
of the Plan or the Option without the consent of the holder of such Option.
XVIII. TERMINATION OR SUSPENSION OF THE PLAN
The Board of Directors may at any time suspend or terminate
the Plan; provided, however, that the Board of Directors shall not suspend or
terminate the Plan prior to granting the Options on the dates set forth in
Article II to the key employees of the Company listed on Subsections A and B of
Annex A hereto. The Plan shall terminate at the close of business on the
Termination Date. Options may not be granted while the Plan is suspended or
after it is terminated. Rights and obligations under any Option granted while
the Plan is in effect shall not be altered or impaired by suspension or
termination of the Plan, except upon the consent of the person to whom the
Option was granted. The power of the Committee to construe and administer any
Options granted prior to the termination or suspension of the Plan under Article
III nevertheless shall continue after such termination or during such
suspension.
XIX......SAVINGS PROVISION
With respect to persons subject to Section 16 of the Exchange
Act, transactions under the Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successors under the Exchange Act. To the extent
any provision of the Plan or action by the Committee fails to so comply, it
shall be deemed null and void, to the extent permitted by law and deemed
advisable by the Committee.
XX.......GOVERNING LAW
The Plan and such Options as may be granted hereunder and all
related matters shall be governed by, and construed and enforced in accordance
with, the laws of the State of Florida from time to time obtaining.
XXI......PARTIAL INVALIDITY
The invalidity or illegality of any provision herein shall not
be deemed to affect the validity of any other provision.
XXII. EFFECTIVE DATE
The Plan shall become effective at 9:00 A.M., Sarasota,
Florida time, on the Effective Date; provided, however, that if the Plan is not
approved by a vote of the stockholders of the Company at an annual meeting or
any special meeting or by unanimous written consent within twelve (12) months
after the Effective Date, any Options granted hereunder shall be Non-Qualified
Options whether or not initially designated as such by the Committee.
Annex A
Stock Option Distributions
A. First Allotment: Options to purchase 340,909 shares are to be
distributed to the following key employees and Secondary Management (as
defined herein) in the respective number of shares:
(1) Curd 73,864
(2) Soran 62,500
(3) Zulanas 34,091
(4) Janney 28,409
(5) Lynn 17,045
(6) Foster 17,045
(7) Lauer 17,045
(8) Matrange 17,045
(9) President of UEP 17,045
(10) Secondary Management 56,820
(As determined by the Committee)
"Secondary Management" shall mean the following individuals or their
successors for each the following companies:
1. Acrylic Division of Polycast Technology Corporation
a. McCormick (Operations)
b. J. Lee (R & D)
c. DuPont (Sales/Mkt)
d. Pungello (Finance)
2. Royalite Division of Polycast Technology Corporation
a. Dobersch (Operations)
b. V. Lee (R & D)
c. Munday (Sales/Mkt)
d. Ketcham (Finance)
3. Uniroyal Engineered Products, Inc. ("UEP")
a. Schrader (Operations)
b. [Open] (R & D)
c. Schaltz (Sales/Mkt)
d. Steele (Sales/Mkt)
e. [Open] (Finance)
4. Uniroyal Adhesives and Sealants Company, Inc./Ensolite, Inc.
a. Chiantello (Operations)
b. [Open] (R & D)
c. [Open] (Sales/Mkt)
d. Lauer (Finance)
e. Miller (Finance)
5. Uniroyal Technology Corporation
a. Wagner (Finance)
b. [Open]
B. Second Allotment: Options to purchase up to 454,545 shares are to be
distributed to the following key employees and Secondary Management in
the respective number of shares:
(1) Curd 97,727
(2) Soran 82,955
(3) Zulanas 45,455
(4) Janney 37,500
(5) Lynn 22,727
(6) Foster 22,727
(7) Lauer 22,727
(8) Matrange 22,727
(9) President of UEP 22,727
(10) Secondary Management 77,273
(As determined by the Committee)
C. Third Allotment: It is contemplated that options to purchase up to
568,182 shares will be distributed to the following key employees and
Secondary Management in the respective number of shares, or to such key
employees of the company or Secondary Management and in such number of
shares as determined by the Committee, in its discretion:
(1) Curd 123,864
(2) Soran 104,545
(3) Zulanas 56,818
(4) Janney 47,727
(5) Lynn 28,409
(6) Foster 28,409
(7) Lauer 28,409
(8) Matrange 28,409
(9) President of UEP 28,409
(10) Secondary Management 93,183
(As determined by the Committee)