EXHIBIT 10. C
ALPHA INDUSTRIES, INC.
1994 NON-QUALIFIED STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
1. Purpose. The appropriate purpose of this 1994 Non-Qualified Stock
Option Plan for Non-Employee Directors is to attract and retain the services of
experienced and knowledgeable independent directors of the Corporation for the
benefit of the Corporation and its stockholders and to provide additional
incentives for such independent directors to continue to work for the best
interests of the Corporation and its stockholders through continuing ownership
of its common stock.
2. Definitions. As used herein, each of the following terms has the
indicated meaning:
"Annual Meeting" means the Corporation's annual meeting of
stockholders or special meeting in lieu of annual meeting of stockholders at
which one or more directors are elected.
"Board" means the Board of Directors of the Corporation.
"Commencement Date" means the date of the first Annual Meeting
following the approval of the Plan by the Board.
"Corporation" means Alpha Industries, Inc.
"Fair Market Value" means the closing sale price quoted on the
American Stock Exchange or such other national securities exchange or automated
quotation system on which the Shares may be traded or quoted on the date of the
granting of the Option.
"Non-Employee Director" means a person who, as of any applicable
date, is a member of the Board and is not an officer or employee of the
Corporation or any subsidiary of the Corporation.
"Option" means the contractual right to purchase Shares upon the
specific terms set forth in this Plan.
"Option Exercise Period" means the period commencing one (1) year
after the date of grant of an Option pursuant to this Plan and ending ten years
from the date of grant.
"Plan" means this Alpha Industries, Inc. 1994 Non-Qualified Stock
Option Plan for Non-Employee Directors.
"Shares" means the Common Stock, $.25 par value, of the Corporation.
"Subsidiary" means any corporation in an unbroken chain of
corporations beginning with the Corporation if, at the time of grant of the
Option, each of the corporations other than the last in the unbroken chain owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
3. Stock Subject to the Plan. The aggregate number of Shares that may
be issued and sold under the Plan shall be 50,000. The Shares to be issued upon
exercise of Options granted under this Plan shall be made available, at the
discretion of the Board, from (i) treasury Shares and Shares reacquired by the
Corporation for such purposes, including Shares purchased in the open market,
(ii) authorized but unissued Shares, and (iii) Shares previously reserved for
issuance upon exercise of Options which have expired or been terminated. If any
Option granted under this Plan shall expire or terminate for any reason without
having been exercised in full, the unpurchased Shares covered thereby shall
become available for grant under additional Options under the Plan so long as it
shall remain in effect.
4. Administration of the Plan. The Plan shall be administered by the
Board. The Board shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms and provisions of the
Plan and any Option issued under the Plan (and any agreement relating thereto)
and to otherwise supervise the administration of the Plan.
5. Eligibility; Grant of Option. On the Commencement Date, each Non-
Employee Director shall be granted an Option to purchase 5,000 Shares. In
addition, upon initial election or appointment as a Non-Employee Director,
immediately following the Annual Meeting at which such Non-Employee Director is
first elected by the stockholders, each Non-Employee Director shall be granted
an Option to purchase 5,000 Shares. Options to purchase Shares may be awarded to
Non-Employee Directors by the action of the Board or by the action of the
compensation committee described in Section III(a) of the Company's 1996
Long-Term Incentive Plan (the 'Committee'). Such awards shall be in lieu of
awards of options under the 1997 Non-Qualified Stock Option Plan for
Non-Employee Directors
6. Terms of Options and Limitations Thereon.
(a) Option Agreement. Each Option granted under this Plan shall be
evidenced by an Option agreement between the Corporation and the Option holder
and shall be upon such terms and conditions, not inconsistent with this Plan, as
the Board may determine.
(b) Price. The price at which any Shares may be purchased pursuant
to the exercise of an Option shall be the greater of the Fair Market Value of
the Shares on the date of grant or four dollars ($4.00).
(c) Exercise of Option. Each Option granted under this Plan may be
exercised as follows:
(i) beginning on the first anniversary of the date of grant, for
up to 20% of the Shares covered by the Option; and
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(ii) beginning on each anniversary of the date of grant thereafter,
for up to an additional 20% of such Shares for each additional year, until, on
the fifth anniversary of the date of grant, the Option may be exercised as to
100% of the Shares covered by the Option, until the expiration of the Option
Exercise Period.
Options may be exercised in whole, or in part, from time to time, only
during the Option Exercise Period, by the giving of written notice, signed by
the holder of the Option, to the Corporation stating the number of Shares with
respect to which the Option is being exercised, accompanied by full payment for
such Shares pursuant to section 7(a) hereof; provided however, (i) if a person
to whom an Option has been granted ceases to be a Non-Employee Director during
the Option Exercise Period by reason of retirement, death or any reason, other
than termination for cause, such Option shall be exercisable by him or her or by
the executors, administrators, legatees or distributees of his or her estate
until the earlier of (A) the end of the Option Exercise Period or (B) 36 months
following his or her retirement or death or the date on which he or she ceased
to be a Non-Employee Director; and (ii) if a person to whom an Option has been
granted ceases to be a Non-Employee Director of the Corporation by reason of
termination for cause, such Option shall terminate as of the date such person
ceased to be a Non-Employee Director. Termination for cause shall be defined as
termination on account of any act of (i) fraud or intentional misrepresentation,
or (ii) embezzlement, misappropriation or conversion of assets or opportunities
of the Corporation or any Subsidiary.
(d) Non-Assignability. No Option, or right or interest in an
Option, shall be assignable or transferable by the holder, except by will, the
laws of descent and distribution or pursuant to a qualified domestic relations
order (as defined in the Internal Revenue Code of 1986, as amended, or Title I
of the Employee Retirement Income Security Act of 1974, as amended, or the rules
thereunder), and during the lifetime of the holder shall be exercisable only by
him or her.
7. Payment.
(a) The purchase price of Shares upon exercise of an Option shall
be paid by the Option holder in full upon exercise, and may be paid (i) in cash,
(ii) by delivery of Shares, or (iii) any combination of cash and Shares, as the
Board may determine.
(b) No Shares shall be issued or transferred upon exercise of any
Option under this Plan unless and until all legal requirements applicable to the
issuance or transfer of such Shares, and such other requirements as are
consistent with the Plan, have been complied with to the satisfaction of the
Board, including without limitation those described in Paragraph 10 hereof.
8. Stock Adjustments.
(a) If the Corporation is a party to any merger or consolidation,
any purchase or acquisition of property or stock, or any separation,
reorganization or liquidation, the Board (or,
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if the Corporation is not the surviving corporation, the board of directors of
the surviving corporation) shall have the power to make arrangements, which
shall be binding upon the holders of unexpired Options, for the substitution of
new options for, or the assumption by another corporation of, any unexpired
Options then outstanding hereunder.
(b) If by reason of recapitalization, reclassification, stock
split, combination of shares, separation (including a spin-off) or dividend on
the stock payable in Shares, the outstanding Shares of the Corporation are
increased or decreased or changed into or exchanged for a different number or
kind of shares or other securities of the Corporation, the Board shall
conclusively determine the appropriate adjustment in the exercise prices of
outstanding Options and in the number and kind of shares as to which outstanding
Options shall be exercisable.
(c) In the event of a transaction of the type described in
paragraphs (a) and (b) above, the total number of Shares on which Options may be
granted under this Plan shall be appropriately adjusted by the Board.
9. Change of Control Provisions.
(a) Notwithstanding any other provision of the Plan to the
contrary, in the event of a Change of Control, any Options outstanding as of the
date such Change of Control is determined to have occurred and not then
exercisable shall become fully exercisable to the full extent of the original
grant.
(b) A "Change in Control" shall mean:
(i) there shall have been consummated (a) any consolidation or
merger of the Corporation in which the Corporation is not the continuing or
surviving entity pursuant to which the Shares are converted into cash,
securities or other property, other than a merger of the Corporation in which
the ownership by the Corporation's stockholders of the securities in the
surviving entity is in the same proportion as the ownership by the Corporation's
stockholders of the stock in the Corporation immediately prior to the merger or
(b) any sale, lease, exchange or other transfer (in one transaction or a series
of related transactions) of all or substantially all of the assets of the
Corporation; or
(ii) the stockholders of the Corporation have approved any
plan or proposal for the liquidation or dissolution of the Corporation; or
(iii) any person (as that term is used in Sections 13(d) and
14 (d)(2) of the Securities Exchange Act of 1934, as amended (the "1934 Act"))
has become the beneficial owner (within the meaning of Rule 13d-3 promulgated
under the 1934 Act) of 30% or more of the Corporation's outstanding Shares; or
(iv) that during any period of two consecutive years,
individuals who, at the beginning of such period, constitute the entire Board
shall cease, for any reason, to constitute a majority thereof, unless the
election, or the nomination for election by the Corporation's
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stockholders, of each new director was approved by a vote of at least
three-quarters of the directors then still in office who were directors at the
beginning of the period.
10. No Rights Other Than Those Expressly Created. No person affiliated
with the Corporation or any Subsidiary or other person shall have any claim or
right to be granted an Option hereunder. Neither this Plan nor any action taken
hereunder shall be construed as (i) giving any Option holder any right to
continue to be affiliated with the Corporation, (ii) giving any Option holder
any equity or interest of any kind in any assets of the Corporation, or (iii)
creating a trust of any kind or a fiduciary relationship of any kind between the
Corporation and any such person. No Option holder shall have any of the rights
of a stockholder with respect to Shares covered by an Option, until such time as
the Option has been exercised and Shares have been issued to such person.
11. Miscellaneous.
(a) Withholding of Taxes. Pursuant to applicable Federal, state,
local or foreign laws, the Corporation may be required to collect income or
other taxes upon the grant of an Option to, or exercise of an Option by, a
holder. The Corporation may require, as a condition to the exercise of an
Option, that the recipient pay the Corporation, at such time as the Board
determines, the amount of any taxes which the Board may determine is required to
be withheld.
(b) Securities Law Compliance. Upon exercise of an Option, the
holder shall be required to make such representations and furnish such
information as may, in the opinion of counsel for the Corporation, be
appropriate to permit the Corporation to issue or transfer the Shares in
compliance with the provisions of applicable federal or state securities laws.
The Corporation, in its discretion, may postpone the issuance and delivery of
Shares, upon any exercise of an Option, until completion of such registration or
other qualification of such Shares under any federal or state laws, or stock
exchange listing, as the Corporation may consider appropriate. The Corporation
intends to register or qualify the Shares under federal and state securities
laws, but is not obligated to register or qualify the Shares under such laws and
may refuse to issue such Shares if neither registration nor exemption therefrom
is practical. The Board may require that prior to the issuance or transfer of
any Shares upon exercise of an Option, the recipient enter into a written
agreement to comply with any restrictions on subsequent disposition that the
Board or the Corporation deems necessary or advisable under any applicable
federal and state securities laws. Certificates representing the Shares issued
hereunder may be legended to reflect such restrictions.
(c) Compliance with Rule l6b-3. With respect to a person subject
to Section 16 of the 1934 Act, transactions under this Plan are intended to
comply with all applicable conditions of Rule l6b-3 or its successors ("Rule
16b-3") under the 1934 Act, including maintaining the status of the Non-Employee
Directors as "disinterested persons" under Rule 16b-3. To the extent any
provision of the Plan or action by the administrators of the Plan fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the administrators of the Plan.
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(d) Indemnity. The Board shall not be liable for any act,
omission, interpretation, construction or determination made in good faith in
connection with their responsibilities with respect to the Plan, and the
Corporation hereby agrees to indemnify the members of the Board, in respect of
any claim, loss, damage, or expense (including counsel fees) arising from any
such act, omission, interpretation, construction or determination, to the full
extent permitted by law.
(e) Options Not Deemed Incentive Stock Options. Options granted
under the Plan shall not be deemed incentive stock options as that term is
defined in Section 422 of the Internal Revenue Code of 1986, as amended.
12. Effective Date; Amendment; Termination.
(a) The effective date of this Plan shall be the date of the
approval of stockholders of the Corporation holding at least a majority of the
voting stock of the Corporation present or represented and entitled to vote at a
meeting of the stockholders.
(b) The date of grant of any Option granted hereunder shall be the
date upon which such option shall be voted by the Board, unless the vote
expressly otherwise provides.
(c) The Board may at any time, and from time to time, amend,
suspend or terminate this Plan in whole or in part. Provided, however, that so
long as there is a requirement under Rule 16b-3 for stockholder approval of the
Plan and certain amendments thereto, any such amendment which (i) materially
increases the number of Shares which may be subject to Options granted under the
Plan, (ii) materially increases the benefits accruing to participants in the
Plan, or (iii) materially modifies the requirement for eligibility to
participate in the Plan, shall be subject to stockholder approval; and provided,
further, that the provisions of this Plan relating to the amount and price of
securities to be awarded and the timing of such awards may not be amended more
than once every six months, other than to comport with changes in the Internal
Revenue Code, the Employee Retirement Income Security Act, or the rules
thereunder. However, except as provided herein, no amendment, suspension or
termination of this Plan may affect the rights of any person to whom an Option
has been granted without such person's consent.
(d) This Plan shall terminate ten years from its effective date,
and no Option shall be granted under this Plan thereafter, but such termination
shall not affect the validity of Options granted prior to the date of
termination.
Date of Board of Directors Adoption: July 14, 1994
Date of Stockholders Approval: September 12, 1994
Amended: April 27, 1999
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