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EXHIBIT 10.2
AMENDED AND RESTATED 1995 STOCK OPTION PLAN
SECTION 1. Description of this Plan. This is the 1995 Stock Option Plan,
dated December 5, 1995, as amended and restated effective as of February 28,
1999 (this "Plan"), of PIA Merchandising Services, Inc., a Delaware corporation
(the "Company"). Under this Plan, officers, directors, key employees and
consultants of the Company or its wholly-owned Subsidiaries (as defined below),
and other persons directly or indirectly providing valuable services to the
Company and the Subsidiaries, to be selected as set forth below, may be granted
options ("Options") to purchase shares of the common stock, par value $0.01 per
share, of the Company ("Common Stock"). This Plan permits the granting of both
Options that qualify for treatment as incentive stock options ("Incentive Stock
Options") under Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code"), and Options that do not qualify as Incentive Stock Options
("Nonqualified Stock Options"). For purposes of this Plan, the term "Subsidiary"
shall mean any corporation or other entity of which 50% or more of the voting
stock (or equivalent thereof) is owned by the Company or by another Subsidiary
(as so defined) of the Company.
SECTION 2. Purpose of this Plan. The purpose of this Plan and of granting
Options to specified persons is to further the growth, development and financial
success of the Company and the Subsidiaries by providing additional incentives
to certain officers, directors, key employees and consultants of, and other
persons directly or indirectly providing valuable services to, the Company and
the Subsidiaries. By assisting such persons in acquiring shares of Common Stock,
the Company can ensure that such persons will themselves benefit directly from
the Company's and the Subsidiaries' growth, development and financial success.
SECTION 3. Eligibility. The persons who shall be eligible to receive grants
of Options under this Plan shall be, at the time of the grant, the officers,
directors, key employees and consultants of, and other persons directly or
indirectly providing valuable services to, the Company and the Subsidiaries.
Notwithstanding the preceding sentence, only persons who are employees of the
Company and the Subsidiaries shall be eligible to receive grants of Incentive
Stock Options under this Plan. A person who holds an Option is herein referred
to as a "Participant." More than one Option may be granted to any Participant,
grants of Options may be made on more than one occasion to any Participant and
any individual Participant may receive grants of Options on up to 1,000,000
shares of Common Stock. Such grants of Options under this Plan may include an
Incentive Stock Option, Nonqualified Stock Option, or any combination thereof.
SECTION 4. Administration. This Plan shall be administered by the Board of
Directors (the "Board") or by the Compensation Committee established by the
Board. (The entity actually administering this Plan at any time, whether the
Board or the Compensation Committee, is referred to herein as the "Committee.")
If the Compensation Committee is authorized to administer this Plan at any time,
it shall, if possible, be composed solely of two or more Non-Employee Directors,
as such term is defined in Rule 16b-3(b)(3) under the Securities Exchange Act of
1934 (the "Exchange Act") and of persons who are "outside directors" within the
meaning of Code Section 162(m). The Committee shall meet at such times and
places as it determines and may meet through a telephone conference call. A
majority of its members shall constitute a quorum, and the decision of a
majority of those present at any meeting at which a quorum is present shall
constitute the decision of the Committee. A memorandum signed by all the members
of the Committee shall constitute the decision of the Committee without
necessity, in such event, for holding an actual meeting. The Committee is
authorized and empowered to administer this Plan and, subject to this Plan (a)
to select the Participants, to specify the number of shares of Common Stock with
respect to which Options are granted to each Participant, to specify the terms
of the Options and whether such Options shall be Incentive Stock Options or
Nonqualified Stock Options, and in general to grant Options; (b) to determine
the dates upon which Options shall be granted and the terms and conditions
thereof in a manner consistent with this Plan, which terms and conditions need
not be identical as to the various Options granted; (c) to interpret this Plan;
(d) to prescribe, amend and rescind rules relating to this Plan; (e) to
authorize any person to execute on behalf of the Company any instrument required
to effectuate the grant of an Option previously granted by the Committee; (f) to
determine the rights and obligations of Participants under this Plan; (g) to
specify the Option Price (as hereinafter defined); (h) to accelerate the time
during which an Option may be exercised, including, but not limited to, upon a
change of control of the Company, and to otherwise accelerate the time or extend
the post-
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termination exercise period during which an Option may be exercised, in each
case notwithstanding the provisions in the Option Agreement (as defined in
Section 13) stating the time during which it may be exercised; and (i) to make
all other determinations deemed necessary or advisable for the administration of
this Plan. The good faith interpretation and construction by the Committee of
any provision of this Plan or of any Option granted under it shall be final,
conclusive and binding. No member of the Committee shall be liable for any
action or determination made in good faith with respect to this Plan or any
Option granted under it.
SECTION 5. Shares Subject to this Plan. The number of shares of Common
Stock in respect of which Options may be granted under this Plan is 3,500,000,
subject to adjustment as provided in Section 12 hereof. Upon the expiration,
termination or cancellation, in whole or in part, for any reason of an
outstanding Option or any portion thereof which shall not have vested or shall
not have been exercised in full, any shares of Common Stock then remaining
unissued which shall have been reserved for issuance upon such exercise shall
again become available for the granting of additional Options under this Plan.
Notwithstanding the foregoing, shares subject to a terminated Option shall
continue to be considered to be outstanding for purposes of determining the
maximum number of shares that may be issued to a Participant. Similarly, the
repricing of an Option will be considered the grant of a new Option for this
purpose.
SECTION 6. Option Price. Except as provided in Section 12 hereof, the
purchase price per share (the "Option Price") of the shares of Common Stock
underlying each Incentive Stock Option shall be not less than the fair market
value of such shares on the date of granting of the Incentive Stock Option;
provided, however, that if the Participant is a ten percent (10%) stockholder of
the Company as detailed in Code Section 422(b)(6) at the time such Option is
granted (determined after taking into account the constructive ownership rules
of Section 424(d) of the Code), the Option Price shall be not less than 110
percent (110%) of said fair market value. The Option Price of the shares of
Common Stock underlying each Nonqualified Stock Option shall be not less than
eighty-five percent (85%) of the fair market value of such shares on the date of
granting of the Nonqualified Stock Option; provided, however, that with respect
to any Nonqualified Stock Option granted to a "covered employee" (as such term
is defined in Section 162(m) of the Code), the Option Price of the shares of
Common Stock underlying such Nonqualified Stock Option shall be not less than
the fair market value of such shares on the date of granting of such
Nonqualified Stock Option. The fair market value of such shares shall, unless
otherwise expressly determined by the Committee for good reason, shall be (i)
the last reported sale price of the Common Stock on the Nasdaq National Market,
if the Common Stock is quoted on the Nasdaq National Market, (ii) the last
reported sale price of the Common Stock on a national securities exchange, if
the Common Stock is listed on a national securities exchange, or (iii) if the
Common Stock is not so reported or listed, the average of the last reported bid
and asked price of the Common Stock in such market as the Common Stock may be
traded.
SECTION 7. Restrictions on Grants; Vesting of Options. Notwithstanding any
other provisions set forth herein or in any Option Agreement, no Options may be
granted under this Plan subsequent to December 5, 2005. All Options granted
pursuant to this Plan shall be granted pursuant to Option Agreements, as
described in Section 13 hereof. The vesting of all Options may be based on the
Company's attaining of performance criteria as specified at the time of the
granting thereof and/or may also be based on the passage of time. The Committee
shall determine the performance criteria, the performance measurement period and
the vesting schedule applicable to each Option or group of Options in a
schedule, a copy of which shall be filed with the records of the Committee and
attached to each Option Agreement to which the same applies. The performance
criteria, the performance measurement period and the vesting schedule and period
of exercisability need not be identical for all Options granted hereunder.
Following the conclusion of each applicable performance measurement period, the
Committee shall determine, in its sole good faith judgment, the extent, if at
all, that each Option subject thereto shall have vested based upon the
applicable performance criteria and vesting schedule. To the extent any Option
shall not have vested, because the applicable performance criteria has not been
met, and does not also vest based on the passage of time, it shall, to that
extent, automatically terminate and cease to be exercisable to such extent
notwithstanding the stated term during which it may be exercised. The Committee
shall promptly notify each affected Participant of such determination. The
Committee may periodically review the performance criteria applicable to any
Option or Options and, in its sole good faith judgment, may adjust the same to
reflect unanticipated major events, such as catastrophic occurrences, mergers,
acquisitions and the like.
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SECTION 8. Special Limitations on Incentive Stock Options. To the extent
that the aggregate fair market value (determined at the time the respective
Incentive Stock Option is granted) of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by a Participant
during any calendar year under all incentive stock option plans of the Company
and the Subsidiaries exceeds $100,000, or such other limit as may be required by
the Code, such excess Incentive Stock Options shall be treated as Nonqualified
Stock Options. The Committee shall determine, in accordance with applicable
provisions of the Code, Treasury Regulations and other administrative
pronouncements, which of a Participant's Incentive Stock Options will not
constitute Incentive Stock Options because of such limitation and shall notify
the Participant of such determination as soon as practicable after such
determination.
SECTION 9. Exercise of Options. Subject to all other provisions of this
Plan, once vested, each Option shall be exercisable for the full number of
shares of Common Stock subject thereto, or any part thereof, in such
installments and at such intervals as the Committee may determine in granting
such Option, provided that no option may be exercisable subsequent to its
termination date. Once vested, and prior to its termination date, an Option may
be exercised by the Participant by giving written notice to the Company
specifying the number of full shares to be purchased and accompanied by payment
of the full purchase price therefor in cash, by check or in such other form of
lawful consideration as the Committee may approve from time to time, including,
without limitation and in the sole discretion of the Committee, the assignment
and transfer by the Participant to the Company of outstanding shares of Common
Stock theretofore held by the Participant. In connection with such assignment
and transfer, the Company shall have the right to deduct any fractional share to
be paid to the Participant. Once vested, and prior to its termination date, an
Option may only be exercised by the Participant or, in the event of death of the
Participant, by the person or persons (including the deceased Participant's
estate) to whom the deceased Participant's rights under such Option shall have
passed by will or the laws of descent and distribution. Notwithstanding the
foregoing in the immediately preceding sentence, in the event of disability
(within the meaning of Section 22(e)(3) of the Code) of a Participant, a
designee, or if the Participant has no designee, the legal representative, of
such Participant may exercise the Option on behalf of such Participant (provided
such Option would have been exercisable by such Participant) until the right to
exercise such Option expires, as set forth in such Participant's particular
Option Agreement.
SECTION 10. Issuance of Common Stock. The Company's obligation to issue
shares of its Common Stock upon exercise of an Option is expressly conditioned
upon the compliance by the Company with any registration or other qualification
obligations with respect to such shares under any state or federal law or
rulings and regulations of any government regulatory body and the making of such
investment representations or other representations and undertakings by the
Participant (or the Participant's legal representative, heir or legatee, as the
case may be) in order to comply with the requirements of any exemption from any
such registration or other qualification obligations with respect to such shares
which the Company in its sole discretion shall deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that such Participant (or the Participant's legal representative,
heir or legatee): (a) is purchasing such shares for investment and not with any
present intention of selling or otherwise disposing of such shares; and (b)
agrees to have a legend placed upon the face and reverse of any certificates
evidencing such shares (or, if applicable, an appropriate data entry made in the
ownership records of the Company) setting forth (i) any representations and
undertakings which such Participant has given to the Company or a reference
thereto, and (ii) that, prior to effecting any sale or other disposition of any
such shares, the Participant must furnish to the Company an opinion of counsel,
satisfactory to the Company and its counsel, to the effect that such sale or
disposition will not violate the applicable requirements of state and federal
laws and regulatory agencies; provided, however, that any such legend or data
entry shall be removed when no longer applicable. The Company, during the term
of this Plan, will at all times reserve and keep available, and will use its
reasonable efforts to obtain from any regulatory body having jurisdiction any
requisite authority in order to issue and sell such number of shares of Common
Stock as shall be sufficient to satisfy the requirements of this Plan. The
inability of the Company to obtain, from any regulatory body having
jurisdiction, authority reasonably deemed by the Company's counsel to be
necessary for the lawful issuance and sale of any shares hereunder shall relieve
the Company of any liability in respect of the non-issuance or sale of such
shares as to which such requisite authority shall not have been obtained.
SECTION 11. Non-transferability. Except as otherwise provided below, an
Option may not be sold, pledged, assigned, hypothecated, transferred or disposed
of in any manner other than by will or by the laws of
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descent or distribution. The Committee may, in its discretion, authorize all or
a portion of any Nonqualified Stock Option granted to a Participant to be on
terms which permit transfer by such Participant to (a) the spouse, children or
grandchildren of the optionee ("Immediate Family Members"), (b) a trust or
trusts for the exclusive benefit of such Immediate Family Members, or (c) a
partnership in which such Immediate Family Members are the only partners,
provided that (i) there may be no consideration for any such transfer, and (ii)
the Option Agreement (defined below) pursuant to which such Options are granted
must be approved by the Committee, and must expressly provide for
transferability in a manner consistent with this Section 11. Following transfer,
any such Options shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer, provided that for purposes of
Sections 9 and 10 hereof the term "Participants" shall be deemed to refer to the
transferee. The events of termination of employment of Section 25 hereof shall
continue to be applied with respect to the original Participant, following which
the Options shall be exercisable by the transferee only to the extent, and for
the periods specified in the Option Agreement. Any permitted transferee shall be
required prior to any transfer of an Option or shares of Common Stock acquired
pursuant to the exercise of an Option to execute a written undertaking to be
bound by the provisions of the applicable Option Agreement.
SECTION 12. Adjustments Upon Capitalization and Corporate Changes;
Substitute Options. Subject to Section 15(b) hereof, if the outstanding shares
of the Common Stock of the Company are changed into, or exchanged for, a
different number or kind of shares or securities of the Company through
reorganization, merger, recapitalization or reclassification, or if the number
of outstanding shares is changed through a stock split, stock dividend, stock
consolidation or like capital adjustment, or if the Company makes a distribution
in partial liquidation or any other comparable extraordinary distribution with
respect to its Common Stock, an appropriate adjustment shall be made by the
Committee in the number, kind or Option Price of shares as to which Options may
be granted. A corresponding adjustment shall likewise be made in the number,
kind or Option Price of shares with respect to which unexercised Options have
theretofore been granted. Any such adjustment in an outstanding Option, however,
shall be made without change in the total price applicable to the unexercised
portion of the Option but with a corresponding adjustment in the price for each
share covered by the Option. In making such adjustments, or in determining that
no such adjustments are necessary, the Committee may rely upon the advice of
counsel and accountants to the Company, and the good faith determination of the
Committee shall be final, conclusive and binding. No fractional shares of stock
shall be issued under this Plan on account of any such adjustment.
If the Company at any time should succeed to the business of another
corporation through a merger or consolidation, or through the acquisition of
stock or assets of such corporation or its subsidiaries, Options may be granted
under this Plan to option holders of such corporation or its subsidiaries, in
substitution for options to purchase stock of such corporation held by them at
the time of succession. The Committee, in its sole and absolute discretion,
shall determine the extent to which such substitute Options shall be granted (if
at all), the person or persons to receive such substitute Options (who need not
be all option holders of such corporation), the number of Options to be received
by each such person, the Option Price of such Option (which may be determined
without regard to Section 6 hereof) and the terms and conditions of such
substitute Options; provided, however, that the Option Price of each such
substituted Option which is an Incentive Stock Option shall be an amount such
that, in the sole and absolute judgment of the Committee (and in compliance with
Section 424(a) of the Code in the case of an Incentive Stock Option), the
economic benefit provided by such Option is not greater than the economic
benefit represented by the option in the acquired corporation as of the date of
the Company's acquisition of such corporation.
SECTION 13. Option Agreement. Each Option granted under this Plan shall be
evidenced by a written stock option agreement (an "Option Agreement") executed
by the Company and the Participant which (a) shall contain each of the
provisions and agreements herein specifically required to be contained therein,
(b) shall indicate whether such Option is to be an Incentive Stock Option or a
Nonqualified Stock Option, and if an Incentive Stock Option, shall contain terms
and conditions permitting such Option to qualify for treatment as an incentive
stock option under Section 422 of the Code, and (c) may contain such other terms
and conditions as the Committee deems desirable and which are not inconsistent
with this Plan.
SECTION 14. Rights as a Stockholder. A Participant or permitted transferee
of a Participant shall have no rights as a stockholder with respect to any
shares covered by an Option until the date of an entry evidencing such ownership
is made in the stock transfer books of the Company (the "Exercise Date"). No
adjustment
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shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights for which the
record date is prior to the Exercise Date.
SECTION 15. Termination of Options, Acceleration of Options.
(a) Each Option shall terminate and expire, and shall no longer be subject
to exercise, as the Committee may determine in granting such Option, and each
Option granted under this Plan shall set forth a termination date thereof,
which, subject to earlier termination as set forth in Section 7 hereof or this
Section 15, or as otherwise set forth in any particular Option Agreement, with
respect to Nonqualified Stock Options, shall be no later than ten years from the
date such Option is granted, and with respect to Incentive Stock Options, shall
also be no later than ten years from the date such Option is granted unless the
Participant is a ten percent (10%) stockholder of the Company (as described in
Section 422(b)(6) of the Code, and determined after taking into account the
constructive ownership rules of Section 424(d) of the Code) at the time such
Option is granted, in which case the Option shall terminate and expire no later
than five years from the date of the grant thereof. An Incentive Stock Option
shall contain any additional termination events required by Section 422 of the
Code.
(b) Subject to Section 15(c) hereof, unless the Committee shall, in its
sole discretion, determine otherwise, upon (i) the dissolution, liquidation or
sale of all or substantially all of the business, properties and assets of the
Company, (ii) upon any reorganization, merger or consolidation in which the
Company does not survive, (iii) upon any reorganization, merger, consolidation
or exchange of securities in which the Company does survive and any of the
Company's stockholders have the opportunity to receive cash, securities of
another corporation and/or other property in exchange for their capital stock of
the Company, or (iv) upon any acquisition by any person or group (as defined in
Section 13(d) of the Securities Act of 1934) of beneficial ownership of more
than fifty percent (50%) of the Company's then outstanding shares of Common
Stock (each of the events described in clauses (i), (ii), (iii) or (iv) is
referred to herein individually as an "Extraordinary Event"), this Plan and each
outstanding Option shall terminate. In such event each Participant shall have
the right until 10 days before the effective date of the Extraordinary Event to
exercise, in whole or in part, any unexpired Option or Options issued to the
Participant, to the extent that said Option is then vested and exercisable
pursuant to the provisions of said Option or Options and of Section 7 hereof.
The termination of employment of, or the termination of a consulting or other
relationship with, a Participant for any reason shall not accelerate or
otherwise affect the number of shares with respect to which an Option may be
exercised;
provided, however, that the Option may only be exercised with respect to that
number of shares which could have been purchased under the Option had the Option
been exercised by the Participant on the date of such termination.
(c) Notwithstanding the provisions of Section 7 or paragraphs (a) or (b) of
this Section 15, or any provision to the contrary contained in a particular
Option Agreement, the Committee, in its sole discretion, at any time, or from
time to time, may elect to accelerate the vesting of all or any portion of any
Option then outstanding. The decision by the Committee to accelerate an Option
or to decline to accelerate an Option shall be final, conclusive and binding. In
the event of the acceleration of the exercisability of Options as the result of
a decision by the Committee pursuant to this Section 15(c), each outstanding
Option so accelerated shall be exercisable for a period from and after the date
of such acceleration and upon such other terms and conditions as the Committee
may determine in its sole discretion; provided, however, that such terms and
conditions (other than terms and conditions relating solely to the acceleration
of exercisability and the related termination of an Option) may not adversely
affect the rights of any Participant without the consent of the Participant so
adversely affected. Any outstanding Option which has not been exercised by the
holder at the end of such stated period shall terminate automatically and become
null and void.
SECTION 16. Withholding of Taxes. The Company, or a Subsidiary, as the case
may be, may deduct and withhold from the wages, salary, bonus and other income
paid by the Company or such Subsidiary to the Participant the requisite tax upon
the amount of taxable income, if any, recognized by the Participant in
connection with the exercise in whole or in part of any Option, or the sale of
Common Stock issued to the Participant upon the exercise of an Option, as may be
required from time to time under any federal or state tax laws and regulations.
This withholding of tax shall be made from the Company's (or such Subsidiaries')
concurrent or next payment of wages, salary, bonus or other income to the
Participant or by payment to the
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Company (or such Subsidiaries) by the Participant of the required withholding
tax, as the Committee may determine. The Company may permit the Participant to
elect to surrender, or authorize the Company to withhold, shares of Common Stock
(valued at their fair market value on the date of surrender or withholding of
such shares) in satisfaction of the Company's withholding obligation, however,
no fractional shares of Common Stock shall be delivered, nor shall any cash in
lieu of fractional shares be paid, by the Company. The Company shall have the
right to deduct fractional shares to be paid to the Participant as a result of
such surrender or withholding of shares.
SECTION 17. Effectiveness and Termination of this Plan. This Plan became
effective on the date on which it was adopted by the Board and was approved by
approved by the stockholders of the Company within 12 months of December 5,
1995. This Plan shall terminate at the earliest of the time when all shares of
Common Stock which may be issued hereunder have been so issued, or at such time
as set forth in Section 15(b) hereof; provided, however, that the Board may in
its sole discretion terminate this Plan at any other time. Unless earlier
terminated by the Board, this Plan shall terminate on December 5, 2005. Subject
to Section 15(b) hereof, no such termination shall in any way affect any Option
then outstanding.
SECTION 18. Time of Granting Options. The date of grant of an Option shall,
for all purposes, be the date on which the Committee makes the determination
granting such Option. Notice of the determination shall be given to each
Participant to whom an Option is so granted within a reasonable time after the
date of such grant.
SECTION 19. Amendment of this Plan. The Board may (a) make such changes in
the terms and conditions of granted Options as it deems advisable, provided each
Participant adversely affected by such change consents thereto, and (b) make
such amendments to this Plan as it deems advisable. Such amendments and changes
shall include, but not be limited to, acceleration of the time at which an
Option may be exercised. The Board may obtain stockholder approval of any
amendment to this Plan for any reason (including in order to take advantage of
certain exemptions under Code Section 162(m) or Code Section 422), but shall not
be required to do so unless required by law or by the rules of the Nasdaq
National Market or any stock exchange on which the Common Stock may then be
listed.
SECTION 20. Transfers and Leaves of Absence. For purposes of this Plan, (a)
a transfer of a Participant's employment or consulting relationship, without an
intervening period, between the Company and a Subsidiary shall not be deemed a
termination of employment or a termination of a consulting relationship, and (b)
a Participant who is granted in writing a leave of absence shall be deemed to
have remained in the employ of, or in a consulting relationship with, the
Company (or a Subsidiary, whichever is applicable) during such leave of absence.
Notwithstanding the foregoing, for purposes of determining the exercisability of
an Incentive Stock Option, a Participant who is on a leave of absence that
exceeds 90 days will be considered to have terminated his or her employment on
the 91st day of the leave of absence, unless the Participant's rights to
reemployment are guaranteed by statute or contract.
SECTION 21. No Obligation to Exercise Option. The granting of an Option
shall impose no obligation on the Participant to exercise such Option.
SECTION 22. Governing Law. This Plan and any Option granted pursuant to
this Plan shall be construed under and governed by the laws of the State of
Delaware without regard to conflict of law provisions thereof.
SECTION 23. Not an Employment or Other Agreement. Nothing contained in this
Plan or in any Option Agreement shall confer, intend to confer or imply any
rights of employment or any rights to any other relationship or rights to
continued employment by, or rights to a continued consulting relationship with,
the Company or any Subsidiaries in favor of any Participant or limit the ability
of the Company or any Subsidiaries to terminate, with or without cause, in its
sole and absolute discretion, the employment of, or relationship with, any
Participant, subject to the terms of any written employment or other agreement
to which a Participant is a party.
SECTION 24. Termination of Employment. The terms and conditions under which
an Option may be exercised after a Participant's termination of employment shall
be determined by the Committee and shall be specified in the Option Agreement.
The conditions under which such post-termination exercises shall be
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permitted with respect to Incentive Stock Options shall be determined in
accordance with the provisions of Section 422 of the Code.
SECTION 25. Indemnification. In addition to such other rights of
indemnification as they may have as directors, the members of the Committee
shall be indemnified by the Company to the fullest extent permitted by law
against the reasonable expenses, including reasonable attorneys' fees, actually
and necessarily incurred in connection with the defense of any action, suit or
proceeding, or in connection with any appeal therein, to which they or any of
them may be a party by reason of any action taken or failure to act under or in
connection with this Plan or any Option granted thereunder, and against all
amounts paid by them in satisfaction of a judgment in any such action, suit or
proceeding, except in relation to matters as to which it shall be adjudged in
such action, suit or proceeding that such Committee member is not entitled to
indemnification under applicable law; provided that within 60 days after
institution of any such action, suit or proceeding such Committee member shall
in writing offer the Company the opportunity, at the Company's expense, to
handle and defend the same.
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