1979 STOCK OPTION PLAN
FOR KEY EMPLOYEES
(With Stock Appreciation Rights)
Adopted: April 26, 1979
As Amended
September 25, 1980
September 24, 1981
January 27, 1983, and
April 25, 1991
THIS DOCUMENT CONSTITUTES PART OF
A PROSPECTUS COVERING SECURITIES
THAT HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
APRIL 2, 1993
MARTIN MARIETTA CORPORATION
1979 STOCK OPTION PLAN FOR KEY EMPLOYEES
1. Purpose
The purpose of the Plan is to attract and retain the services
of key employees in positions which contribute materially to the
successful operation of the business of the Corporation and to
grant such employees an attractive opportunity to acquire a
proprietary interest in the business enterprise and thereby provide
them with an added incentive to increase the earnings of the
Corporation.
It is intended that this purpose will be effected through the
granting of stock options and stock appreciation rights, as
provided herein.
2. Definitions
As used in the Plan, "Corporation" means Martin Marietta
Corporation and its subsidiaries. "Subsidiary" means a corporation
of which Martin Marietta Corporation owns, directly or indirectly,
stock having at least 50% of the power to vote, under normal
circumstances, in the election of directors. "Board of Directors"
means the Board of Directors of Martin Marietta Corporation. The
"Committee" means the Stock Option Committee. "Employee" means
officers and other key employees of the Corporation but excludes
directors who are not also officers or employees of the
Corporation. An "option" means an option to purchase shares of
Martin Marietta Common Stock. A "right" means a stock appreciation
right. "Grant" means the award of both a stock option and a stock
appreciation right. The "grant value of the right" means the fair
market value of a share of stock on the date a right is granted, as
that value may be adjusted pursuant to Section 7(a)(iii) of the
Plan.
3. Effective Date
The Plan shall become effective upon the approval by the
stockholders.
4. Eligible Employees
Options and rights may be granted only to exempt salaried
employees of the Corporation. However, not more than 10% of the
total number of shares available under the Plan shall be subject to
option to any one employee, and no individual who owns stock
possessing more than 5% of the combined voting power of all classes
of stock of the Corporation shall be eligible for a grant of
options and rights under the Plan.
5. Terms of Stock Options and Stock Appreciation Rights
The term of each option and right granted under the Plan shall
be determined by the Board of Directors, consistent with the
provisions of the Plan, including the following:
(a) Each grant of options and rights may be exercised in
whole or in part subject to the provisions of the Plan,
provided that no option or right shall be exercisable prior to
one year or after ten years from the date of grant. Except
as provided in Section 6(c)(ii) each grant shall be divided
into three approximately equal installments of 100-share and
100-right increments. The first installment shall be
exercisable one year after the date of grant and each
succeeding installment shall be exercisable one year from the
date the prior installment became exercisable. To the extent
that the installments are not equal in number, the larger
installment or installments shall be exercisable in the last
or second and last years. After the privilege to exercise an
installment accrues, the options and rights included in that
installment may, except as provided in Section 8, be exercised
at any time prior to the expiration of ten years from date of
grant.
(b) Each optionee must remain in the employ of the
Corporation for at least one year from the date the option and
right are granted before any part of the grant can be
exercised.
(c) An option or right shall not be assignable or
transferable by the employee to whom granted otherwise than by
will or by the laws of descent and distribution and shall be
exercisable during the participant's lifetime only by the
participant or in the event of disability by the legal
guardian or representative.
(d) The grant will be evidenced by a certificate that
will specify the number of shares and rights to which it
pertains.
6. Stock Options
(a) Shares of Stock Subject to the Plan
The shares that may be issued under the Plan shall not exceed
750,000 shares of the Common Stock, $1.00 par value, of the
Corporation except as provided in Paragraph (c) below. They may
consist in whole or in part of unissued or treasury shares. Such
treasury shares may be acquired to satisfy the requirements of the
Plan. If for any reason shares as to which an option has been
granted cease to be subject to purchase, then such shares shall
again be available for option under the Plan.
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(b) Grant of Options
(i) The purchase price of the stock subject to option
shall not be less than 100% of the fair market value of the
stock on the date the option is granted, except as otherwise
provided in Section 6(c)(i) below.
(ii) The purchase price of the stock subject to option
shall be paid in cash or, with the approval of the Board of
Directors or the Committee, may be paid in full or part by the
tender of Martin MarIetta Corporation Common Stock owned by
the optionee. Common Stock delivered in payment of the
purchase price shall be valued at the fair market value and
any portion of the purchase price not satisfied by the tender
of Common Stock shall be paid in full in cash upon such
exercise. No fractional shares shall be issued. As soon as
possible following receipt of payment to the Corporation, the
optionee (or other person entitled to exercise the option)
shall receive a certificate or certificates for such shares,
subject to the provisions of Section 6(d).
(iii) No person shall have the right of a stockholder with
respect to shares subject to an option until the date the
option is exercised.
(c) Adjustment Upon Changes in Stock
(i) If there shall be any change affecting the stock
subject to the Plan or to any option granted thereunder
through merger, consolidation, reorganization,
recapitalization, stock dividend, stock split or combination,
or otherwise, the Board of Directors shall make appropriate
proportional adjustments in the aggregate number of shares
subject to the Plan and the number of shares and the price per
share subject to outstanding options and may assume old
options or substitute new options for old options, regardless
of whether the option price of any such option resulting from
the proportional adjustment is less than the then fair market
value of the subject shares.
(ii) In the event of a proposed dissolution or
liquidation of Martin Marietta Corporation, each option
granted under the Plan shall terminate as of a date, which in
no event shall be later than the expiration date specified in
the option, to be fixed by the Board of Directors, provided
that not less than 30 days' written notice of the date so
fixed shall be given to each optionee (or other person
entitled to exercise the option) and each optionee (or other
person entitled to exercise the option) shall have the right
(provided that by the date of exercise of the option the
optionee has remained in the employ of the Corporation for at
least one year from the date the option was granted), during
the period of 30 days preceding such termination to exercise
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the option as to all or any part of the shares covered
thereby, including shares as to which such option would not
otherwise then be exercisable.
(iii) In the event of a Change of Control, each optionee
(or other person entitled to exercise the option) shall have
the right (provided that by the date of exercise of the option
the optionee has remained in the employ of the Corporation for
at least six months from the date the option was granted),
during period of 60 days following a Change of Control to
exercise the option as to all or any pert of the shares
covered thereby, including shares as to which such option
would not otherwise then be exercisable. For purposes of this
paragraph, the term "Change of Control" shall mean the
following:
(A) a tender offer or exchange offer is made whereby the
effect of such offer is to take over and control the
affairs of the Corporation and such offer is consummated
for the ownership of securities of the Corporation
representing 25% or more of the combined voting powers of
the Corporation's then outstanding voting securities;
(B) The Corporation is merged or consolidated with
another corporation and as a result of such merger or
consolidation less than 75% of the outstanding voting
securities of the surviving or resulting corporation
shall then be owned in the aggregate by the former
stockholders of the Corporation, other than affiliates
within the meaning of the Securities Exchange Act of 1934
(the "Exchange Act") or any party to such merger or
consolidation;
(C) the Corporation transfers substantially all of its
assets to another corporation or entity which is not a
wholly owned subsidiary of the Corporation;
(D) any "person" (as such term is used in
Sections 3(a)(9) and 13(d)(3) of the Exchange Act) is or
becomes the beneficial owner, directly or indirectly, of
securities of the Corporation representing 25% or more of
the combined voting power of the Corporation's then
outstanding securities and the effect of such ownership
is to take over and control the affairs of the
Corporation; or
(E) during any period of two consecutive years,
individuals who at the beginning of such period
constitute the Board of Directors of the Corporation
cease for any reason to constitute at least a majority
thereof unless the election, or the nomination for
election by the Corporation's stockholders, of each new
director was approved by a vote of at least two-thirds of
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the directors then still in office who were directors at
the beginning of the period. For purposes of the Plan,
ownership of voting securities shall take into account
and include ownership as determined by applying the
provisions of Rule 13d--3(d)(I)(i) of the exchange Act
(as then in effect).
(d) Limitations on Transfer of Shares
The Corporation shall not be required, upon the exercise of
any option, to issue or deliver any shares of stock prior to (a)
the authorization of such shares for listing on any stock exchange
on which Martin Marietta Corporation's Common Stock may then be
listed, and (b) such registration or other qualification of such
shares under applicable securities laws as the Corporation shall
determine to be necessary or advisable. If shares issuable on the
exercise of options have not been registered under the Securities
Act of 1933 ("the Act"') or theme is not available a current
Prospectus meeting the requirements of the Act with respect
thereto, optionees may be required to represent at the time of each
exercise of options that the shares purchased are being acquired
for investment and not with a view to distribution; and the
Corporation may place a legend on the stock certificate to indicate
that the stock may not be sold or otherwise disposed of except in
accordance with the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
7. Stock Appreciation Rights
(a) Grant of Rights
(i) Stock appreciation rights shall be granted only to
recipients of stock options and each right will relate to a
specific stock option granted under the Plan. The number of
rights granted shall equal the number of shares granted under
the stock option provisions of the Plan and shall be granted
concurrently with the grant of the related stock option.
(ii) A right shall entitle an optionee to receive without
payment to the Corporation cash equivalent to the excess, if
any, of the fair market value of a share of Martin Marietta
Common Stock on the exercise date over the grant value of the
right.
(iii) Should there be a change affecting the stock
subject to the Plan as referred to in Section 6(c), the number
of rights shall be adjusted to equal the number of related
stock option shares upon completion of the adjustment required
by the change. The grant value of a right shall also be
adjusted to equal the option price of the related stock option
following the adjustment required by the change.
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(b) Exercise of Rights
(i) Subject to the limitations set forth herein, an
optionee shall be entitled to receive payment in cash for
rights granted under this Plan. The cash payment will be in
consideration of services performed for the Corporation or for
its benefit by the optionee.
(ii) Nothing contained herein shall be construed to
require the simultaneous exercise of options and the related
rights where such options or rights are exercised after
May 1,1991.
(c) Limitation on Value of Rights
The cash payment for a right shall not exceed 100% of the
grant value of the right except in the event of a Change of Control
in which event the value shall be determined in accordance with
Section 7(a)(ii).
8. Death, Termination of Employment, or Retirement
(a) If an optionee dies while employed by the
Corporation or within three months after termination of
employment, options and rights may be exercised by the persons
referred to in Section 5(c) only within one year from the date
of death. In cases of retirement, either early or normal, or
of disability, options may be exercised within three years
from the date of such retirement or disability. In cases of
termination of an optionee's employment by the Corporation,
with or without cause, the options and rights may be exercised
by the optionee only within three months from the date of
termination of employment. Nothing contained in the Plan or
in any option or right granted hereunder shall confer upon any
optionee any right of continued employment by the Corporation
nor limit in any way the right of the Corporation to terminate
the participant's employment at any time.
(b) Except in cases of retirement or disability, a grant
may be exercised pursuant to this Section 8 only to the extent
the optionee was entitled to exercise the options and rights
at the time of termination of employment or death or as
provided in Section 6(c)(ii), and in any event, may not be
exercised after the expiration of ten years from the date of
grant. In the event an optionee ceases to be an employee, the
options and rights which are not exercisable at the time shall
terminate. In cases of retirement where an optionee has
applied for and is receiving benefits pursuant to a retirement
plan for Martin Marietta salaried employees, or disability,
all outstanding options and rights shall become exercisable
upon such retirement or disability and may be exercised
pursuant to this Section 8 or as provided in Section 6(c)(ii)
but in any event options and rights may not be exercised less
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than six months or after the expiration of ten years from the
date of grant thereof.
9. Leave of Absence
For the purpose of the Plan, an employee on leave of absence
will be considered as still in the employ of the Corporation unless
otherwise provided in an agreement between the employee and the
Corporation.
10. Administration
(a) Stock Option Committee
(i) The Stock Option Committee shall consist of three or
more of those members of the Board of Directors who are not
eligible to receive options and rights under the Plan. The
members of the Committee shall be designated by the Board of
Directors. A majority of the members of the Committee shall
constitute a quorum. The vote of a majority of a quorum shall
constitute action by the Committee.
(ii) The Committee shall determine the employees who will
participate in the Plan, the number of shares and rights
subject to each grant, and shall have the authority to adopt
rules and regulations for administering the Plan.
(iii) As and to the extent authorized by the Board of
Directors or the By-Laws, the Committee may exercise the
powers and authority related to the Plan which are vested in
the Board of Directors. The Committee may delegate to the
officers or employees of the Corporation the authority to
execute and deliver documents and to take such other steps
deemed necessary or convenient for the efficient
administration of the Plan.
(b) Finality of Determinations
The Board of Directors shall have the power to interpret the
Plan. All interpretations, determinations, and actions by the
Board of Directors or, to the extent authorized by the Plan, the
Board of Directors or the By-Laws, by the Committee, shall be
final, conclusive, and binding upon all parties.
11. Amendment and Termination
The Board of Directors shall have the power, in its
discretion, to amend, suspend, or terminate the Plan or options and
rights granted under the Plan at any time. It shall not, however,
without further action by the stockholders, have the power to (a)
change the class of employees eligible to receive options under the
Plan, (b) provide for options or rights exercisable more than ten
years after the date granted, or (c) extend the expiration date of
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the Plan; nor shall it have the power (except as otherwise provided
in the Plan) to (d) increase the number of shares subject to the
Plan or (e) reduce the option price below the fair market value of
the stock at the time the option was granted. No amendment,
suspension, or termination of the Plan or options and rights
granted under the Plan shall, except with the consent of the
optionee, adversely affect an option or right previously granted.
12. Duration
The Plan shall remain in effect until all options and rights
granted under the Plan have been exercised or terminated under the
terms of the Plan, provided that options and rights under the Plan
must be granted within ten years from the effective date of the
Plan.
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