EXHIBIT 10.21
SILGAN HOLDINGS INC.
FOURTH AMENDED AND RESTATED 1989 STOCK OPTION PLAN
I. PURPOSE OF PLAN; DEFINITIONS.
1.1 Purpose.
The purpose of the Silgan Holdings Inc. Fourth Amended and
Restated 1989 Stock Option Plan (the "Plan") is to strengthen Silgan Holdings
Inc., a Delaware corporation (the "Company"), by providing an additional means
of attracting and retaining officers and key personnel. It is intended that this
purpose be achieved by extending to designated officers or employees of the
Company an added long-term incentive for high levels of performance and for
unusual efforts designed to improve the financial performance of the Company,
through the grant of options to purchase shares of common stock of the Company
(as described herein). It is further intended that pursuant to this Plan, the
Committee may grant either ISOs or Nonstatutory Options (both as defined
herein).
1.2 Definitions.
For purposes of this Plan, the following terms shall be
defined as indicated, unless otherwise clearly required by the context in which
the term appears:
"Board of Directors" shall mean the Board of Directors of the Company.
"Carryover Amount" shall mean, in the case of all persons to whom
Options were granted effective as of June 30, 1989, an amount per share
determined by the Committee, and in the case of all other persons,
zero.
"Change of Control" shall mean any sale of the assets or voting stock
of the Company, whether by purchase, merger, consolidation or other
similar transaction, pursuant to which there is a transfer of ownership
of more than fifty percent (50%) of the assets or the voting stock of
the Company to a Person which theretofore did not own, directly or
indirectly, any of the voting stock of the Company; provided, however,
that a merger or consolidation of the Company with or into Silgan
Corporation or other restructuring of the Company in which the
stockholders of the Company retain at least fifty percent (50%) of the
voting stock of the surviving Person shall not be deemed a Change of
Control.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Committee" shall mean the committee of three or more persons selected
by the Board of Directors to administer this Plan.
"Common Stock" shall mean the authorized and issuable common stock of
the Company ($.01 par value).
"Fair Market Value" shall mean (i) if the stock is listed or admitted
to trade on a national securities exchange, the closing price of the
stock on the composite tape of the principal national securities
exchange on which the stock is so listed or admitted to trade, (ii) if
the stock is not listed or admitted to trade on a national securities
exchange, the mean between the last reported bid and asked price for
the stock as furnished by the National Association of Securities
Dealers, Inc. through NASDAQ or a similar organization if NASDAQ is no
longer reporting such information, or (iii) if the stock is not listed
or admitted to trade on a national securities exchange and if bid and
asked prices for the stock are not so furnished through NASDAQ or a
similar organization, the fair market value of the stock as determined
in good faith by the Committee in such manner as it deems appropriate,
taking into consideration, among other things, recent sales of the
stock.
"ISO" shall mean incentive stock option(s) within the meaning of
Section 422 of the Code.
"Nonstatutory Options" shall mean an option granted pursuant to the
Plan which does not qualify as an ISO.
"Option(s)" shall mean option(s) to purchase Common Stock under this
Plan and shall include Options that result from the conversion of
options under and as provided in stock option plans of any Subsidiary
to which the Company is a party.
"Option Price" shall have the meaning set forth in Section 3.1 hereof.
"Person" shall mean any individual, partnership, joint venture,
corporation, association, trust, or any other entity or organization,
including a government or political subdivision or any agency or
instrumentality thereof.
"Public Offering" shall mean a primary, public offering of shares of
Common Stock, pursuant to an effective registration statement,
registered under the Securities Act of 1933, as amended.
"S&H Stockholders" shall mean R. Philip Silver and D. Greg
Horrigan.
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"Subsidiary" shall mean any corporation if 50% or more of the total
combined voting power and value of all classes of stock is owned,
either directly or indirectly, by the Company or another Subsidiary.
II. ADMINISTRATION; PARTICIPATION.
2.1 Administration.
This Plan shall be administered by the Committee, none of the
members of which are currently eligible to receive Options and have not been
eligible to receive Options for at least twelve (12) months prior to their
selection to the Committee. The action of the Committee with respect to the
administration of this Plan shall be taken pursuant to a majority vote or the
written consent of a majority of its members. In the event action by the
Committee is taken by written consent of its members, the action by the
Committee shall be deemed to have been taken at the time the last member
required for valid action by the Committee signs the consent.
Subject to the express provisions of this Plan, the Committee
shall have the authority to construe and interpret this Plan and any agreements
defining the rights and obligations of the Company and participants under this
Plan, to further define the terms used in this Plan, to prescribe, amend and
rescind rules and regulations relating to the administration of this Plan, to
determine the duration and purposes of leaves of absence which may be granted to
participants without constituting a termination of their employment for purposes
of this Plan and to make all other determinations necessary or advisable for the
administration of this Plan. The determinations of the Committee on the
foregoing matters shall be conclusive.
Subject to the express provisions of this Plan, the Committee
shall select from the eligible class of employees of the Company or a Subsidiary
and make corresponding recommendations to the Board of Directors concerning the
individuals to whom Options shall be granted and the terms and provisions of
such Options (which need not be identical) including, but not by way of
limitation, the time at which such Options shall be granted, whether an Option
granted hereunder shall be intended to be treated as an ISO or a Nonstatutory
Option, the number of shares subject to each Option and the Option Price and the
consideration acceptable in payment of the Option Price. The Committee shall
also determine, as to each individual to whom Options shall be granted effective
as of June 30, 1989, the Carryover Amount, if any, applicable to such
individual.
No member of the Committee shall be liable for any action,
failure to act, determination or interpretation made in good faith with respect
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to this Plan or any transaction hereunder. The Company hereby agrees to
indemnify each member of the Committee for all costs and expenses and, to the
extent permitted by applicable law, any liability incurred by any member in
connection with defending against, responding to, negotiating the settlement of
or otherwise dealing with any claim, cause of action or dispute of any kind
arising in connection with the member's actions in administering this Plan or
authorizing or denying authorization to any transaction hereunder.
The Board of Directors, at any time it so desires, may
increase or decrease the number of members of the Committee, may remove from
membership on the Committee all or any portion of its members, and may appoint
such person or persons as it desires to fill any vacancy existing on the
Committee, whether caused by removal, resignation or otherwise.
2.2 Participation.
Only officers or key employees of the Company, or of a
Subsidiary, whose responsibility levels indicate their ability to substantially
contribute to the Company's growth and development shall be eligible for
selection by the Committee to participate in this Plan; provided, however, that
members of the Committee shall not, while members of this Committee, be eligible
to receive Options under this Plan. In addition, members of the Board of
Directors who are not officers or employees of the Company or of any Subsidiary
shall not be eligible to receive Options under this Plan. An individual who has
been granted an Option may, if otherwise eligible, be granted additional Options
if the Committee so determines.
Notwithstanding anything herein to the contrary, during the
initial term of the Amended and Restated Management Services Agreement dated as
of February 12, 1997 by and between S&H, Inc. and the Company (i.e., until June
30, 1999, unless such initial term is terminated for any reason prior to the
expiration thereof), Options may be granted under this Plan to either of the S&H
Stockholders if, and only if, any such grant of Options is approved by (i) a
majority of the members of the Committee (which majority must include a majority
of the members of the Committee excluding any of the S&H Stockholders that are
members of the Committee) and (ii) a majority of the members of the Board of
Directors (which majority must include a majority of the members of the Board of
Directors excluding any of the S&H Stockholders that are members of the Board of
Directors).
2.3 Stock Subject to the Plan.
Subject to Section 4.1 hereof, the stock to be offered under
this Plan shall be shares of authorized but unissued Common Stock or Common
Stock held in treasury. The aggregate amount of Common Stock to be delivered
upon exercise of all Options granted under the Plan shall not exceed the sum of
(i) 124,000 shares plus (ii) such number of shares issuable upon exercise of all
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Options that will be outstanding upon and in the event of the conversion to
Options of options under and in accordance with stock option plans of all
Subsidiaries, with such sum being subject to adjustment as set forth in Section
4.1 of this Plan. Such amount of Common Stock is hereby reserved for issuance
under this Plan. If any Option shall expire or terminate for any reason without
having been fully exercised, the unexercised shares subject thereto shall again
be available for the purposes of this Plan.
2.4 Stock Option Agreements.
Each Option granted pursuant to this Plan shall be evidenced
by an Incentive Stock Option Agreement or a Nonstatutory Stock Option Agreement
(any of which are at times herein referred to as an "Option Agreement" or,
collectively, as "Option Agreements"), which shall set forth the terms and
conditions of the option and specify whether such option is intended to be an
ISO or a Nonstatutory Stock Option.
III. OPTIONS.
3.1 Option Price.
Except as otherwise provided herein, the purchase price per
share of the Common Stock covered by each Option (the "Option Price") shall be
determined by the Committee; provided, however, the Option Price for an ISO
shall not be less than the Fair Market Value of the Common Stock covered by the
Option at the time of grant. The Option Price of any share purchased shall be
paid in full at the time of each purchase in cash, by check, or, provided that
all necessary regulatory approvals have been received, and provided further that
the Option Agreement provides for such exercise, the person exercising the
Option may deliver in payment of all or a portion of the Option Price
certificates for other shares of Common Stock which shall be valued at the Fair
Market Value of such Common Stock as of the date of exercise of the Option.
3.2 Option Period.
Except as otherwise provided herein or as otherwise determined
by the Committee, each Option and all rights or obligations thereunder shall
expire on such date as shall be provided in the Option Agreement, but not later
than the tenth anniversary (fifth anniversary in the case of an ISO granted to
an employee who owns or is deemed to own at the time of grant more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Company or a Subsidiary) of the date on which the Option is granted, and shall
be subject to earlier termination as hereinafter provided.
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3.3 Exercise of Options.
Each Option shall become exercisable and the total number of
shares subject thereto shall be purchasable no sooner than one year from the
date of the grant of the Option, and only in such installments, which need not
be equal, as specified in the Option Agreement. If the holder of an Option shall
not in any given installment period purchase all of the shares which the holder
is entitled to purchase in such installment period, the holder's right to
purchase any shares not so purchased in such installment period shall continue
until the expiration or earlier termination of the holder's Option. The
Committee may, at any time after grant of the Option and from time to time,
increase the number of shares purchasable in any installment so long as the
total number of shares subject to the Option is not increased. No Option or
installment thereof shall be exercisable except in respect of whole shares, and
fractional share interests shall be disregarded except that they may be
accumulated in accordance with the second sentence of this Section 3.3. No fewer
than ten (10) shares may be purchased at one time unless the number purchased is
the total number at the time available for purchase under the Option. The
Committee may impose such conditions or limitations, as shall be specified in
the applicable Option Agreement, on the sale or transfer of Common Stock
acquired upon exercise of an Option as it may deem necessary or desirable.
3.4 Nontransferability of Options.
An Option granted under this Plan shall, by its terms, be
nontransferable by the holder other than by will or the laws of descent and
distribution, and shall be exercised during the holder's lifetime only by the
holder or a duly appointed guardian or personal representative.
3.5 Termination of Employment.
(a) If an Option holder ceases to be an officer of or employed
by the Company or a Subsidiary because of the Option holder's voluntary
termination of employment, the Option will be exercisable only until the date of
resignation from office or termination of employment, to the extent, and only to
the extent, installments had become exercisable as of the date of termination of
employment or resignation from office.
(b) If an Option holder ceases to be an officer of or employed
by either the Company or a Subsidiary for any reason other than voluntary
termination specified in Section 3.5(a), the Option holder shall have ninety
(90) days, or such other period provided in the Option Agreement, from the date
of termination of employment to exercise his or her Option, to the extent, and
only to the extent, installments had become exercisable prior to the date of
termination of employment or removal or resignation from office.
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3.6 Permanent Disability of Employee.
If an Option holder is no longer an officer of or employed by
either the Company or a Subsidiary, as a result of permanent disability (as
defined below), the holder shall have twelve (12) months, or such shorter period
as is provided in the Option Agreement, from the date of termination of
employment to exercise his or her Option. The Option shall expire at the end of
such 12-month period (or such shorter period as is provided in the Option
Agreement or as provided pursuant to Section 3.2 hereof) to the extent not
exercised within that period. As used herein, "permanent disability" shall mean
the inability of an Option holder by reason of illness or injury to perform
substantially all of his or her duties as an employee of the Company or a
Subsidiary during any continued period of one hundred eighty (180) days.
3.7 Death of Employee.
If an Option holder dies while an officer of or employed by
the Company or a Subsidiary, or during the periods described in Section 3.5(b)
or 3.6 hereof, the holder's Option shall be exercisable during the twelve-month
period, or such shorter period as is provided in the Option Agreement, following
the holder's death, by the executor of the holder's will, the administrator of
the holder's estate, or as otherwise provided in the Option Agreement, (and not
otherwise, regardless of any community property or other interest therein of the
spouse of the holder or such spouse's successor in interest), provided that in
no event shall the Option be exercised after the period provided for in Section
3.2 hereof. Unless sooner terminated pursuant to the Plan, the Option shall
expire at the end of such twelve-month period (or such shorter period as is
provided in the Option Agreement or as is provided pursuant to Section 3.2
hereof) to the extent not exercised within that period. In the event that the
holder's spouse shall have acquired a community property interest in the Option,
the holder, the executor of the holder's will, the administrator of the holder's
estate, or such other Person as is otherwise provided in the Option Agreement,
may exercise the option on behalf of the spouse of the holder or such spouse's
successor in interest.
3.8 Limitation on Grant of ISOs.
The aggregate Fair Market Value (determined as of the date or
dates the ISO or ISOs are granted) of the Common Stock with respect to which the
ISO or ISOs granted to an employee are exercisable for the first time by such
employee during any one calendar year (under this Plan and all other incentive
stock option plans of the Company or any Subsidiary) shall not exceed $100,000.
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3.9 Option Shall be Designated an ISO or Nonstatutory Option.
The Option Agreement for each option grant shall state whether
the Options granted thereby are intended to be ISOs or Nonstatutory Options.
IV. OTHER PROVISIONS.
4.1 Adjustments Upon Changes in Capitalization and Ownership.
Subject to Section 4.2 below, if the outstanding shares of
Common Stock are increased, decreased or changed into, or exchanged for, a
different number or kind of shares or securities of the Company through a
reorganization or merger in which the Company is the surviving entity,
combination, recapitalization, reclassification, stock split-up, reverse stock
split, stock dividend, stock consolidation or otherwise, an appropriate and
proportionate adjustment shall be made in the number and kind of shares for
which Options may be granted as set forth in Section 2.3 hereof and in the
Carryover Amount. A corresponding adjustment changing the number or kind of
shares and the exercise price per share allocated to unexercised Options or
portions thereof, which shall have been granted prior to any such change, and
the Carryover Amount, shall also be made. Subject, in the case of ISOs, to
Section 424 of the Code, any such adjustment, 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.
Upon the dissolution or liquidation of the Company, or,
subject to Section 4.2 below, upon a reorganization, merger or consolidation of
the Company with one or more corporations as a result of which the Company is
not the surviving corporation, in which such surviving corporation (or an
affiliate), if applicable, does not assume all obligations of the Company under
this Plan and substitute for the unexercised Options granted under the Plan
options to purchase securities of such surviving corporation having a value
substantially equivalent to or greater than the Common Stock issuable upon
exercise of such Options and on terms substantially the same as or better than
those granted under the Plan, such Options shall become immediately exercisable
upon the occurrence of such an event, but in no event may such Options be
exercised after the exercise period specified in each individual Option
Agreement.
Adjustments under this Section 4.1 shall be made by the
Committee, whose determination as to what adjustments shall be made, and the
extent thereof, shall be final, binding and conclusive. No fractional shares of
Common Stock shall be issued under this Plan on account of any such adjustment.
If for any reason any person becomes entitled to any interest in a fractional
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share, a cash payment shall be made of an equivalent value of such interest.
4.2 Change of Control.
In the event of a Change of Control other than a Pooling
Transaction (as hereinafter defined) during the term of one or more Options,
such Options shall, subject to Section 4.1 above, remain outstanding and shall
become exercisable by the holder thereof upon the terms and conditions of the
Plan and the Option Agreement between such holder and the Company; provided,
however, the Committee may, in its discretion, take one or more of the following
actions in connection with a Change of Control (other than a Pooling
Transaction):
(a) The Committee may declare that any or all
Options shall terminate as of a date to be fixed by the Committee and may
require that the respective holders thereof surrender all or a portion of their
unexercised Options for cancellation by the Company prior to such date and, upon
such surrender, such holders shall receive (i) the cash, securities or other
consideration they would have received had they exercised such Options
immediately prior to such Change of Control and had they disposed of their
shares of Common Stock issuable upon such exercise in connection with such
Change of Control (subject to required deductions and withholdings), minus (ii)
an amount of cash or fair market value of securities or other such consideration
equal to the Option Price for such Options surrendered; or
(b) The Committee may declare that, upon the
exercise by a holder of any or all Options after a Change of Control in
accordance with the provisions of the Plan, such holder shall be entitled to
receive only the cash, securities or other consideration he would have been
entitled to receive had he exercised such Options immediately prior to such
Change of Control and had he disposed of the Common Stock issuable upon such
exercise in connection with such Change of Control; or
(c) The Committee may declare that any or all
Options shall terminate as of a date to be fixed by the Committee and give the
holders thereof the right to exercise their Options prior to such date as to all
or any part thereof; or
(d) The Committee may permit the successor
corporation to assume the obligations of the Company under the Plan and to
substitute for the unexercised Options granted under the Plan options to
purchase securities of such successor corporation having a value substantially
equivalent to or greater than the Common Stock issuable upon exercise of such
Options and on terms substantially the same as or better than those granted
under the Plan, all as determined by the Committee, whereupon all outstanding
Options and all future Options granted under the Plan shall thenceforth become
options to purchase such securities of such successor corporation on such terms.
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Notwithstanding anything herein or in any Option Agreement to
the contrary, if, during the term of one or more Options, there shall occur a
Change of Control which is intended to qualify as a "pooling of interests" for
accounting and financial reporting purposes (a "Pooling Transaction"), it shall
be a condition to the effectiveness of such Change of Control transaction that
the acquiror agree to assume the obligations of the Company under the Plan and
to provide for the substitution of options to purchase securities equivalent to,
and with terms the same as, those granted under the Plan, all as determined by
the Committee.
4.3 Continuation of Employment.
Nothing contained in this Plan (or in any Option granted
pursuant to this Plan) or in any Option Agreement shall confer upon any employee
any right to continue in the employ of the Company or a Subsidiary or constitute
any contract or agreement of employment or interfere in any way with the right
of the Company or a Subsidiary to reduce any person's compensation from the rate
in existence at the time of the granting of an Option or Right or to change any
person's position or duties or to demote or terminate such person's employment
with or without cause, but nothing contained herein or in any Option Agreement
shall effect any contractual rights of an employee obtained otherwise than under
this Plan.
4.4 Government Regulations.
This Plan and the grant and exercise of Options shall be
subject to all applicable rules and regulations of governmental authorities.
4.5 Withholding.
The Company may require, as a condition to (1) issuing or
delivering to the holder of an Option shares or certificates evidencing the
shares upon exercise of the Option or (2) allowing the transfer of shares
subsequent to their issuance to the holder of an Option, that the holder of an
Option or other person exercising the Option pay any sums that federal, state,
or local tax law requires to be withheld with respect to such exercise or
transfer. Neither the Company nor any Subsidiary shall be obligated to advise
any holder of an Option of the existence of the tax or the amount which the
Company will be so required to withhold.
4.6 Amendment, Termination, and Reissuance.
(a) The Board of Directors may at any time suspend, amend or
terminate this Plan (or any part thereof) and, with the consent of the holder of
an Option, may make such modifications of the terms and conditions of such
holder's Option as it shall deem advisable. No Option may be granted during any
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suspension of this Plan or after such termination. The amendment, suspension or
termination of this Plan shall not, without the consent of the holder of an
Option, adversely alter or impair any rights or obligations under any Option
theretofore granted under this Plan. The Committee shall have the power and may,
with the consent of the holder of any Option, cancel any existing Option and
reissue Options to the holder of those canceled Options, having a new and lower
Option Price, but otherwise bearing substantially similar terms to the canceled
Options.
(b) In addition to the Board of Directors' approval of any
amendment, if the amendment would (i) increase the benefits accruing to
participants in this Plan, (ii) increase the aggregate number of shares which
may be issued under this Plan, or (iii) modify the requirements of eligibility
for participation in this Plan, then such amendment shall be approved by the
holders of a majority of the Company's outstanding capital stock present, or
represented, and entitled to vote at a meeting duly held for the purpose of
approving such amendment. For purposes of this Subsection 4.6(b), any
cancellation and reissuance of Options at the same, or a new or lower, Option
Price pursuant to Subsection 4.6(a) hereof shall not constitute an amendment of
the Plan.
4.7 Time of Grant and Exercise.
(a) Except as the Committee or Board of Directors shall
otherwise determine, the granting of an Option pursuant to the Plan shall take
place at the time of the resolutions adopted by the Committee granting such
Option; provided, however, that if the appropriate resolutions of the Committee
indicate that an Option is to be granted as of or at some future date, the date
of grant shall be such future date.
(b) An Option shall be deemed to be exercised when the
Secretary of the Company receives written notice of such exercise from the
person entitled to exercise the Option, together with payment in full of the
purchase price made in accordance with Section 3.1 of this Plan and all
applicable withholding taxes.
4.8 Privileges of Stock Ownership; Nondistributive Intent.
The holder of an Option shall not be entitled to the privilege
of stock ownership as to any shares of Common Stock not actually issued and
delivered to him or her. Upon exercise of an Option, unless a registration
statement is in effect under the Securities Act of 1933, as amended, relating to
the Common Stock issuable upon exercise and there is available for delivery a
prospectus meeting the requirements of Section 10(a)(3) of said Act, the Common
Stock may be issued to the option holder only if he or she represents and
warrants in writing to the Company and its counsel that the shares purchased are
being acquired for investment and not with a view to the resale or distribution
thereof. No shares shall be issued upon the exercise of any Option unless and
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until there shall have been full compliance with any then applicable
requirements of the Securities and Exchange Commission, or any other regulatory
agencies having jurisdiction over this Plan (and of any exchanges upon which
stock of the Company may be listed).
4.9 Issuance of Stock Certificates.
Upon exercise of an Option, the person receiving Common Stock
shall be entitled to one stock certificate evidencing the shares acquired upon
such exercise; provided, however, that any person who tenders Common Stock to
the Company in payment of a portion or all of the purchase price of stock
purchased upon exercise of an Option, shall be entitled to receive two
certificates, one representing a number of shares equal to the number of shares
exchanged for the stock acquired upon exercise, and another representing the
additional shares acquired upon exercise of the Option.
4.10 Effective Date of this Plan.
This Plan shall, subject to its adoption by the Board of
Directors and the Company's stockholders in accordance with applicable law and
the Company's Certificate of Incorporation, be effective as of June 30, 1989.
4.11 Expiration.
Unless previously terminated by the Board of Directors, this
Plan shall expire at the close of business on the date that is ten (10) years
less one day from the date executed below and no Option shall be granted under
it thereafter, but such expiration shall not affect any Option theretofore
granted.
4.12 Governing Law.
This Plan and the Options issued hereunder shall be governed
by, and construed in accordance with, the laws of the State of New York
applicable to contracts made and performed within such State, except as such
laws may be supplanted by the laws of the United States of America, which laws
shall then govern its effect and its construction to the extent they supplant
New York law.
EXECUTED as of the 14th day of February, 1997.
SILGAN HOLDINGS INC.
By /s/ R. Philip Silver
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Title Co-Chief Executive Officer
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