Exhibit 4.3
INNOTECH, INC.
1996 EQUITY INCENTIVE PLAN
Section 1. Purpose; Definitions.
The purpose of the Innotech, Inc. 1996 Equity Incentive
Plan (the "Plan") is to enable Innotech, Inc. (the "Company") to
offer to officers, other employees and independent agents,
consultants and advisors of the Company and its subsidiaries,
long-term performance-based stock and/or other equity interests in
the Company thereby enhancing its ability to attract, retain and
reward such individuals. The various types of long-term incentive
awards which may be provided under the Plan will enable the Company
to respond to changes in compensation practices, tax laws,
accounting regulations and the size and diversity of its
businesses.
For purposes of the Plan, the following terms shall be
defined as set forth below:
(a) "Agents" means those persons who are not employees
of the Company or any subsidiary, including independent agents,
consultants and advisors for the Company.
(b) "Board" means the Board of Directors of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as
amended from time to time, and any successor thereto.
(d) "Committee" means the Stock Option Committee of the
Board or any other committee of the Board which the Board may
designate.
(e) "Company" means Innotech, Inc., a corporation
organized under the laws of the State of Delaware.
(f) "Deferred Stock" means Stock to be received, under
an award made pursuant to Section 8 below, at the end of a
specified deferral period.
(g) "Disability" means disability as determined under
procedures established by the Committee for purposes of the Plan.
(h) "Early Retirement" means retirement, with the
approval of the Committee for purposes of one or more award(s)
hereunder, from active employment with the Company or any
Subsidiary prior to age 65.
(i) Fair Market Value: As said term is used in the Plan,
the "Fair Market Value" of a share of Stock on any day means: (i)
if the principal market for the Stock is The New York Stock
Exchange, any other national securities exchange or the Nasdaq
National Market, the closing sales price of the Stock on such day
as reported by such exchange or market, or on a consolidated tape
reflecting transactions on such exchange or market, or (ii) if the
principal market for the Stock is not a national securities
exchange and the Stock is quoted on the National Association of
Securities Dealers Automated Quotations System, the mean between
the closing bid and the closing asked prices for the Stock on such
day as quoted on such System, or (iii) if the principal market for
the Stock is not a national securities exchange and if the Stock is
not quoted on the National Association of Securities Dealers
Automated Quotations System, the mean between the highest bid and
lowest asked prices for the Stock on such day as reported by the
National Quotation Bureau, Inc.; provided that if clauses (i), (ii)
and (iii) of this paragraph are all inapplicable, or if no trades
have been made or no quotes are available for such day, the Fair
Market Value of the Stock shall be determined by the Company by any
method which it deems to be appropriate. The determination of the
Company shall be conclusive as to the Fair Market Value of the
Stock.
(j) "Incentive Stock Option" means any Stock Option
intended to be and designated as an "incentive stock option" within
the meaning of Section 422 of the Code.
(k) "Non-Qualified Stock Option" means any Stock Option
that is not an Incentive Stock Option.
(l) "Normal Retirement" means retirement from active
employment with the Company or any Subsidiary on or after age 65.
(m) "Other Stock-Based Award" means an award under
Section 9 below that is valued in whole or in part by reference to,
or is otherwise based upon, Stock.
(n) "Plan" means this Innotech, Inc. 1996 Equity
Incentive Plan, as hereinafter amended from time to time.
(o) "Qualified Domestic Relations Order" shall have the
meaning assigned to such term under the Code and the regulations
promulgated thereunder.
(p) "Restricted Stock" means Stock, received under an
award made pursuant to Section 7 below, that is subject to
restrictions under said Section 7.
(q) "Retirement" means Normal Retirement or Early
Retirement.
(r) "SAR Value" means the value of the excess of the
Fair Market Value of one share of Stock over the Stock Option
exercise price per share specified in a related Stock Option
multiplied by the number of shares in respect of which the Stock
Appreciation Right shall be exercised, on the date of exercise.
(s) "Stock" means the Common Stock of the Company, par
value $.001 per share.
(t) "Stock Appreciation Right" means the right, pursuant
to an award granted under Section 6 below, to surrender to the
Company all (or a portion) of a Stock Option in exchange for an
amount equal to the SAR Value.
(u) "Stock Option" or "Option" means any option to
purchase shares of Stock which is granted pursuant to the Plan.
(v) "Subsidiary" means any present or future subsidiary
corporation or affiliated entity of the Company, as such term is
defined in Section 424(f) of the Code, or any successor thereto.
Section 2. Administration.
(a) The Plan shall be administered by the Committee, the
membership of which shall be at all times constituted so as to not
adversely affect the compliance of awards under the Plan with the
requirements of Rule 16b-3 under the Securities Exchange Act of
1934, as amended from time to time (the "Exchange Act"), and the
requirements of Section 162(m)(4)(C) of the Code and the
regulations promulgated thereunder, as in effect from time to time,
or with the requirements of any other applicable law, rule or
regulation.
The Committee shall have full authority to grant,
pursuant to the terms of the Plan, to officers and other employees
of the Company and Agents under Section 4 below: (i) Stock Options,
(ii) Stock Appreciation Rights, (iii) Restricted Stock, (iv)
Deferred Stock, and/or (v) Other Stock- Based Awards.
(b) For purposes of illustration and not of limitation,
the Committee shall have the authority (subject to the express
provisions of the Plan):
(i) to select the officers, other employees and Agents
of the Company or any Subsidiary to whom Stock Options, Stock
Appreciation Rights, Restricted Stock, Deferred Stock and/or Other
Stock-Based Awards may from time to time be granted hereunder;
(ii) to determine the Incentive Stock Options,
Non-Qualified Stock Options, Stock Appreciation Rights, Restricted
Stock, Deferred Stock and/or Other Stock-Based Awards, or any
combination thereof, if any, to be granted hereunder to one or more
officers, other employees and Agents;
(iii) to determine the number of shares to be covered
by each award granted hereunder;
(iv) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any award granted
hereunder (including, but not limited to, share price, any
restrictions or limitations, and any vesting, acceleration or
forfeiture provisions, as the Committee shall determine);
(v) to determine the terms and conditions under which
awards granted hereunder are to operate on a tandem basis and/or in
conjunction with or apart from other awards made by the Company or
any Subsidiary outside of the Plan;
(vi) to determine the extent and circumstances under
which Stock and other amounts payable with respect to an award
hereunder shall be deferred, which may be either automatic or at
the election of the participant; and
(vii) to substitute (A) new Stock Options for
previously granted Stock Options, which previously granted Stock
Options have higher Option exercise prices and/or contain other
less favorable terms, and (B) new awards of any other type for
previously granted awards of the same type, which previously
granted awards are upon less favorable terms.
Subject to Section 11 hereof, the Committee 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 award issued under the Plan (and to determine the
form and substance of all agreements relating thereto), and to
otherwise supervise the administration of the Plan.
Subject to Section 11 hereof, all decisions made by the
Committee pursuant to the provisions of the Plan shall be made in
the Committee's sole discretion and shall be final and binding upon
all persons, including the Company, its Subsidiaries and Plan
participants.
Section 3. Stock Subject to Plan.
The total number of shares of Stock reserved and
available for distribution under the Plan shall be 200,000 shares.
Such shares may consist, in whole or in part, of authorized and
unissued shares or treasury shares. The maximum number of shares
of Stock as to which any individual may receive an award hereunder
during any calendar year shall be 100,000.
If any shares of Stock underlying an Option cease to be
subject to such Option, or if any shares of Stock that are subject
to any Stock Appreciation Right, Restricted Stock, Deferred Stock
award or Other Stock-Based Award granted hereunder are forfeited or
any such award otherwise terminates without a payment being made to
the participant in the form of cash and/or Stock, such shares
shall, for purposes of both of the limitations set forth in the
preceding paragraph, again be available for distribution in
connection with future grants and awards under the Plan.
In the event of any merger, reorganization,
consolidation, recapitalization, dividend (other than a dividend or
its equivalent which is credited to a Plan participant or a regular
cash dividend), Stock split or other change in corporate structure
affecting the Stock, such substitution or adjustment shall be made
in the aggregate number of shares of Stock reserved for issuance
under the Plan, in the number and Option exercise price of shares
subject to outstanding Options granted under the Plan, in the
maximum number of shares as to which any individual may receive an
award hereunder in any calendar year and in the number of shares
subject to other outstanding awards (including but not limited to
awards of Restricted Stock, Deferred Stock and Other Stock-Based
Awards) granted under the Plan as may be determined to be
appropriate by the Committee in order to prevent dilution or
enlargement of rights, provided that the number of shares subject
to any award shall always be a whole number. Such adjusted Option
exercise price shall also be used to determine the amount payable
by the Company upon the exercise of any Stock Appreciation Right
associated with any Stock Option.
Each Option shall be subject to the requirement that if
at any time the Board shall determine, in its discretion, that the
listing, registration or qualification of the shares of Stock
subject to such Option upon any securities exchange, stock market
or quotation system or under any state, federal or local law, or
the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with,
the granting of such Option or the issuance or purchase of shares
of Stock thereunder, no such Option may be exercised in whole or in
part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any condition
not acceptable to the Board.
Section 4. Eligibility.
Officers and other employees of the Company or any
Subsidiary (but excluding members of the Committee and any person
who serves only as a director of the Company) who are at the time
of the grant of an award under this Plan regularly employed by the
Company or any Subsidiary on a full-time basis and who are
responsible for or contribute to the management, growth and/or
profitability of the business of the Company or any Subsidiary, as
well as Agents, are eligible to be granted Options and other awards
under the Plan. Eligibility under the Plan for such officers and
other employees of the Company, and Agents, shall be determined by
the Committee.
Section 5. Stock Options.
(a) Grant and Exercise. Stock Options granted under the
Plan may be of two types: (i) Incentive Stock Options and
(ii) Non-Qualified Stock Options. Any Stock Option granted under
the Plan shall contain such terms as the Committee may from time to
time approve. The Committee shall have the authority to grant to
any optionee Incentive Stock Options, Non-Qualified Stock Options,
or both types of Stock Options (in each case with or without Stock
Appreciation Rights), which may be granted alone or in addition to
other awards granted by the Company. To the extent that any Stock
Option does not qualify as an Incentive Stock Option, it shall
constitute a separate Non-Qualified Stock Option.
Anything in the Plan to the contrary notwithstanding, no
Incentive Stock Options shall be granted under the Plan unless the
Plan shall have been approved by the Company's stockholders in
accordance with the requirements of Section 422 of the Code, and no
term of the Plan relating to Incentive Stock Options or any
agreement providing for Incentive Stock Options shall be
interpreted, amended or altered, nor shall any discretion or
authority granted under the Plan be so exercised, so as to
disqualify the Plan under Section 422 of the Code, or, without the
consent of the optionee(s) affected, to disqualify any Incentive
Stock Option under such Section 422.
(b) Terms and Conditions. Stock Options granted under
the Plan shall be subject to the following terms and conditions:
(i) Option Exercise Price. The Option exercise price
per share of Stock purchasable under a Stock Option shall be
determined by the Committee at the time of grant but shall be not
less than 100% of the Fair Market Value at the time of grant (110%,
in the case of an Incentive Stock Option granted to an optionee
who, at the time of grant, owns Stock representing more than 10% of
the total combined voting power of all classes of stock of the
Company or its parent (if any) or subsidiary corporations ("10%
Stockholder"), as those terms are defined in Sections 424(e) and
(f) of the Code).
(ii) Option Term. The term of each Stock Option shall be
fixed by the Committee, but no Incentive Stock Option shall be
exercisable more than ten years (five years, in the case of an
Incentive Stock Option granted to a 10% Stockholder) after the date
on which the Option is granted, and no Non-Qualified Stock Option
shall be exercisable more than ten years and one day after the date
on which the Option is granted.
(iii) Exercisability. To ensure that the Company or
any Subsidiary will achieve the purpose and receive the benefits
contemplated in the Plan, any option granted to any optionee
hereunder shall, unless the condition of this sentence is waived or
modified in the agreement evidencing the Option or by resolution
adopted by the Committee, be exercisable according to the following
schedule:
Portion of Total Option
Time Period Which is Exercisable
Date of Grant 33%
First Anniversary of Date of Grant 33%
Second Anniversary of Date of Grant 34%
Subject to the vesting schedule described above, each
option may be exercised in whole or in part; provided, however,
that no fewer than 100 shares (or the remaining shares then
purchasable under the Option if fewer than 100 shares) may be
purchased upon any exercise of Option hereunder and that only whole
shares will be issued pursuant to the exercise of any Option.
(iv) Method of Exercise. Subject to whatever
installment, exercise and waiting period provisions are applicable
in a particular case, Stock Options may be exercised in whole or in
part at any time during the Option term, by giving written notice
of exercise to the Company specifying the number of shares of Stock
to be purchased. Such notice shall be accompanied by payment in
full of the Option exercise price, which shall be in cash or,
unless otherwise provided in the Stock Option agreement referred to
in Section 5(b)(xii) below, in whole shares of Stock which are
already owned by the holder of the Option or, unless otherwise
provided in the Stock Option agreement referred to in Section
5(b)(xii) below, partly in cash and partly in such Stock. Cash
payments shall be made by wire transfer, certified or bank check or
personal check, in each case payable to the order of the Company;
provided, however, that the Company shall not be required to
deliver certificates for shares of Stock with respect to which an
Option is exercised until the Company has confirmed the receipt of
good and available funds in payment of the Option exercise price
therefor. Payments in the form of Stock (which shall be valued at
the Fair Market Value of a share of Stock on the date of exercise)
shall be made by delivery of stock certificates in negotiable form
which are effective to transfer good and valid title thereto to the
Company, free of any liens or encumbrances. An optionee shall have
none of the rights of a stockholder with respect to the shares of
Stock subject to the Option until such shares shall be transferred
to the optionee upon the exercise of the Option. At the discretion
of the Board or the Committee, as the case may be, an Option may be
exercised with respect to a specified number of shares of Stock by
written notice of exercise to the Company stating that (i) the
Option exercise price for the shares and any withholding tax due
thereon will be paid to the Company directly by a broker-dealer
designated by the optionee and irrevocable instructions to such
effect have been furnished by the optionee to such broker-dealer;
and (ii) an advice from the broker-dealer confirming payment to the
Company will be promptly delivered to the Company. The exercise of
any such Option shall be irrevocable at the time of notice to the
Company; provided, however, that the Company shall not be required
to deliver certificates for shares of Stock with respect to the
exercise of the Option until the Company has confirmed the receipt
of good and sufficient funds in payment of the exercise price
thereof.
(v) Transferability; Exercisability. Unless otherwise
specifically provided in the Stock Option agreement referred to in
Section 5(b)(xii) below, no Stock Option shall be transferable by
the optionee otherwise than by will, by the laws of descent and
distribution or by a Qualified Domestic Relations Order, and all
Stock Options shall be exercisable, during the optionee's lifetime,
only by the optionee or by his spouse to whom the Option has been
transferred pursuant to the terms of a Qualified Domestic Relations
Order.
(vi) Termination by Reason of Death. Subject to Section
5(b)(x) below, in the event of the death of an optionee, any Stock
Option held by such optionee, unless otherwise determined by the
Committee, shall be exercisable by the legal representative of the
estate or by the legatee of the optionee under the will of the
optionee, for a period of one year (or such other period as the
Committee may specify, which period shall not be greater than three
months in the case of an Incentive Stock Option) from the date of
such death or until the expiration of the stated term of such Stock
Option, whichever period is the shorter, to the extent such Stock
Option was exercisable at the time of death.
(vii) Termination by Reason of Disability of Employee
Optionee. Subject to Section 5(b)(x) below, any Stock Options held
by an optionee who is an officer or employee and whose employment
by the Company or any Subsidiary terminates by reason of
Disability, unless otherwise determined by the Committee, shall be
exercisable by the optionee for a period of one year (or such other
period as the Committee may specify, which period shall not be
greater than three months in the case of an Incentive Stock Option)
from the date of such termination of employment or until the
expiration of the stated term of such Stock Option, whichever
period is the shorter, to the extent such Stock Option was
exercisable at the time of such Disability; provided, however, that
if the optionee dies within such one-year period (or such other
period as the Committee shall specify, which period shall not be
greater than three months in the case of an Incentive Stock
Option), any unexercised Stock Option (other than an Incentive
Stock Option) held by such optionee shall thereafter be exercisable
to the extent to which it was exercisable at the time of death for
a period of one year from the date of such death or until the
expiration of the stated term of such Stock Option, whichever
period is the shorter.
(viii) Termination by Reason of Retirement of Employee
Optionee. Subject to Section 5(b)(x) below, any Stock Options held
by an optionee who is an officer or employee and whose employment
by the Company or a Subsidiary terminates by reason of Normal
Retirement, unless otherwise determined by the Committee, shall be
exercisable by the optionee for a period of one year (or such other
period as the Committee may specify, which period shall not be
greater than three months in the case of an Incentive Stock Option)
from the date of such termination of employment or the expiration
of the stated term of such Stock Option, whichever period is the
shorter, to the extent such Stock Option was exercisable at the
time of such Normal Retirement; provided, however, that if the
optionee dies within such one-year period, any unexercised Stock
Option (other than an Incentive Stock Option) held by such optionee
shall thereafter be exercisable, to the extent to which it was
exercisable at the time of death, for a period of one year from the
date of such death or until the expiration of the stated term of
such Stock Option, whichever period is the shorter. If an
optionee's employment with the Company or any Subsidiary terminates
by reason of Early Retirement, the Stock Option shall thereupon
terminate, provided if the Committee so approves at the time of
Early Retirement, any Stock Option held by the optionee shall
become fully vested and may thereafter be exercised by the optionee
as provided above in connection with termination of employment by
reason of Normal Retirement.
(ix) Other Termination of Employment of Employee
Optionee. Subject to the provisions of Section 13(g) below and
unless otherwise determined by the Committee, if an optionee who is
an officer or employee whose employment by the Company or any
Subsidiary terminates for any reason other than death, Disability
or Retirement, any Stock Options held by him shall thereupon
automatically terminate, except that if the optionee's employment
is involuntarily terminated by the Company or a Subsidiary, without
cause, such Stock Option may be exercised for the lesser of three
months after termination of employment or the balance of such Stock
Option's term.
(x) Intentionally Omitted.
(xi) Buy-out and Settlement Provisions. The Committee
may at any time offer to buy out a Stock Option previously granted,
based upon such terms and conditions as the Committee shall
establish, and communicate to the optionee at the time that such
offer is made.
(xii) Stock Option Agreement. Each grant of a Stock
Option shall be confirmed by, and shall be subject to the terms of,
an agreement executed by the Company and the participant.
Section 6. Stock Appreciation Rights.
(a) Grant and Exercise. Stock Appreciation Rights may
be granted in conjunction with all or part of any Stock Option
granted by the Company. In the case of a Non-Qualified Stock
Option, such rights may be granted either at or after the time of
the grant of such Non-Qualified Stock Option. In the case of an
Incentive Stock Option, such rights may be granted only at the time
of the grant of such Incentive Stock Option.
A Stock Appreciation Right which is granted with respect
to a given Stock Option shall terminate and shall no longer be
exercisable upon the termination or exercise of the related Stock
Option, except that, unless otherwise determined by the Committee
at the time of grant, a Stock Appreciation Right granted with
respect to less than the full number of shares covered by a related
Stock Option shall not be reduced until after the number of shares
remaining under the related Stock Option equals the number of
shares covered by the Stock Appreciation Right.
A Stock Appreciation Right may be exercised by an
optionee, in accordance with Section 6(b) below, by surrendering
the applicable portion of the related Stock Option. Upon such
exercise and surrender, the optionee shall be entitled to receive
an amount (and in the form) determined in the manner prescribed in
Section 6(b) below. Stock Options which have been so surrendered,
in whole or in part, shall no longer be exercisable to the extent
the related Stock Appreciation Rights have been exercised.
(b) Terms and Conditions. Stock Appreciation Rights
shall be subject to the following terms and conditions:
(i) Stock Appreciation Rights shall be exercisable only
at such time or times and to the extent that the Stock Options to
which they relate shall be exercisable in accordance with the
provisions of Section 5 hereof and this Section 6; provided,
however, that any Stock Appreciation Right granted subsequent to
the grant of the related Stock Option shall not be exercisable
during the first six months of the term of such Stock Appreciation
Right, except that this special limitation shall not apply in the
event of Disability or Termination of an employee optionee or death
of an optionee prior to the expiration of the six-month period.
(ii) Upon the exercise of a Stock Appreciation Right, an
optionee shall be entitled to receive up to, but not more than, an
amount in cash and/or shares of Stock equal to the SAR Value. The
Committee shall have the right to determine the form of payment,
subject to Section 6(b)(v) below. For purposes of this paragraph,
the shares of Stock will be valued at their Fair Market Value on
the date of exercise of the Stock Appreciation Right.
(iii) Stock Appreciation Rights shall be transferable
and exercisable only when and to the extent that the underlying
Stock Option would be transferable and exercisable under Section
5(b)(v) hereof.
(iv) Upon the exercise of a Stock Appreciation Right, the
Stock Option or part thereof to which such Stock Appreciation Right
is related shall be deemed to have been exercised for the purpose
of the limitations set forth in Section 3 hereof on the number of
shares of Stock to be issued under the Plan and on the maximum
number of shares of Stock with respect to which any individual may
receive an award, but only to the extent of the number of shares
issued under the Stock Appreciation Right at the time of exercise
based upon the SAR Value.
(v) The Committee may grant "Limited Stock Appreciation
Rights", i.e., Stock Appreciation Rights that become exercisable
only in the event of a Change in Control as defined in Section 10
hereof, subject to such terms and conditions as the Committee may
specify at the time of grant. Said Limited Stock Appreciation
Rights shall be settled solely in cash, in an amount equal to the
SAR Value.
Each grant of Stock Appreciation Rights shall be
confirmed by, and shall be subject to the terms of, an agreement,
executed by the Company and the participant.
Section 7. Restricted Stock.
(a) Grant and Exercise. Shares of Restricted Stock may
be issued either alone or in addition to other awards granted by
the Company. The Committee shall determine the eligible persons to
whom, and the time or times at which, grants of Restricted Stock
shall be made, the number of shares to be awarded, the price (if
any) to be paid by the recipient, the time or times within which
such awards may be subject to forfeiture (the "Restriction
Period"), the vesting schedule and rights to acceleration thereof,
and all other terms and conditions of the awards.
The Committee may condition the grant of Restricted Stock
upon the attainment of specified performance goals or such other
factors as the Committee may determine.
(b) Terms and Conditions. Each Restricted Stock award
shall be subject to the following terms and conditions:
(i) Restricted Stock, when issued, shall be represented
by a stock certificate or certificates registered in the name of
the holder to whom such Restricted Stock shall have been awarded.
During the Restriction Period, certificates representing the
Restricted Stock and any securities constituting Retained
Distributions (as defined below) shall bear a restrictive legend to
the effect that ownership of the Restricted Stock (and such
Retained Distributions), and the enjoyment of all rights
appurtenant thereto, are subject to the restrictions, terms and
conditions provided in the Plan and the applicable Restricted Stock
agreement. Such certificates shall be deposited by the holder with
the Company, together with stock powers or other instruments of
assignment, each endorsed in blank, which will permit transfer to
the Company of all or any portion of the Restricted Stock and any
securities constituting Retained Distributions that shall be
forfeited or that shall not become vested in accordance with the
Plan and the applicable Restricted Stock agreement.
(ii) Restricted Stock shall constitute issued and
outstanding shares of Common Stock for all corporate purposes. The
holder thereof shall have the right to vote such Restricted Stock,
to receive and retain all regular cash dividends and other cash
equivalent distributions as the Board may in its sole discretion
designate, pay or distribute on such Restricted Stock and to
exercise all other rights, powers and privileges of a holder of
Common Stock with respect to such Restricted Stock, with the
exceptions that (A) the holder will not be entitled to delivery of
the stock certificate or certificates representing such Restricted
Stock until the Restriction Period shall have expired and unless
all other vesting requirements with respect thereto shall have been
fulfilled; (B) the Company will retain custody of the stock
certificate or certificates representing the Restricted Stock
during the Restriction Period; (C) other than regular cash
dividends and other cash equivalent distributions as the Board may
in its sole discretion designate, pay or distribute, the Company
will retain custody of all distributions ("Retained Distributions")
made or declared with respect to the Restricted Stock (and such
Retained Distributions will be subject to the same restrictions,
terms and conditions as are applicable to the Restricted Stock)
until such time, if ever, as the Restricted Stock with respect to
which such Retained Distributions shall have been made, paid or
declared shall have become vested and with respect to which the
Restriction Period shall have expired; (D) the holder may not sell,
assign, transfer, pledge, exchange, encumber or dispose of the
Restricted Shares or any Retained Distributions during the
Restriction Period; and (E) a breach by the holder of any of the
restrictions, terms or conditions contained in this Plan or the
Restricted Stock agreement referred to in the following clause (iv)
or otherwise established by the Committee with respect to any
Restricted Stock or Retained Distributions will cause a forfeiture
of such Restricted Stock and any Retained Distributions with
respect thereto.
(iii) Upon the expiration of the Restriction Period
with respect to each award of Restricted Stock and the satisfaction
of any other applicable restrictions, terms and conditions (A) all
or part of such Restricted Stock shall become vested in accordance
with the terms of the Restricted Stock agreement referred to in the
following clause (iv), and (B) any Retained Distributions with
respect to such Restricted Stock shall become vested to the extent
that the Restricted Stock related thereto shall have become vested.
Any such Restricted Stock and Retained Distributions that do not
vest shall be forfeited to the Company and the holder shall not
thereafter have any rights with respect to such Restricted Stock
and Retained Distributions that shall have been so forfeited.
(iv) Each Restricted Stock award shall be confirmed by,
and shall be subject to the terms of, an agreement executed by the
Company and the participant.
Section 8. Deferred Stock.
(a) Grant and Exercise. Deferred Stock may be awarded
either alone or in addition to other awards granted by the Company.
The Committee shall determine the eligible persons to whom and the
time or times at which Deferred Stock shall be awarded, the number
of shares of Deferred Stock to be awarded to any person, the
duration of the period (the "Deferral Period") during which, and
the conditions under which, receipt of the Stock will be deferred,
and all the other terms and conditions of the awards.
The Committee may condition the grant of Deferred Stock
upon the attainment of specified performance goals or such other
factors or criteria as the Committee shall determine.
(b) Terms and Conditions. Each Deferred Stock award
shall be subject to the following terms and conditions:
(i) Subject to the provisions of this Plan and the award
agreement referred to in Section 8(b)(vii) below, Deferred Stock
awards may not be sold, assigned, transferred, pledged or otherwise
encumbered during the Deferral Period. At the expiration of the
Deferral Period (or the Additional Deferral Period referred to in
Section 8(b)(vi) below, where applicable), share certificates shall
be delivered to the participant, or his legal representative, in a
number equal to the number of shares covered by the Deferred Stock
award.
(ii) As determined by the Committee at the time of award,
amounts equal to any dividends declared during the Deferral Period
(or the Additional Deferral Period referred to in Section 8(b)(vi)
below, where applicable) with respect to the number of shares
covered by a Deferred Stock award may be paid to the participant
currently or deferred and deemed to be reinvested in additional
Deferred Stock.
(iii) Subject to the provisions of the award
agreement and this Section 8 and Section 13(g) below, upon
termination of a participant who is an officer or employee whose
employment with the Company or any Subsidiary is terminated for any
reason during the Deferral Period (or the Additional Deferral
Period referred to in Section 8(b)(vi) below, where applicable) for
a given award, the Deferred Stock in question will vest or be
forfeited in accordance with the terms and conditions established
by the Committee at the time of grant.
(iv) The Committee may, after grant, accelerate the
vesting of all or any part of any Deferred Stock award and/or waive
the deferral limitations for all or any part of a Deferred Stock
award.
(v) In the event of hardship or other special
circumstances of an Agent or a participant who is an officer or
employee whose employment with the Company or any Subsidiary is
involuntarily terminated (other than for cause), the Committee may
waive in whole or in part any or all of the remaining deferral
limitations imposed hereunder or pursuant to the award agreement
referred to in Section 8(b)(vii) below with respect to any or all
of the participant's Deferred Stock.
(vi) A participant may request to, and the Committee may
at any time, defer the receipt of an award (or an installment of an
award) for an additional specified period or until a specified
event (the "Additional Deferral Period"). Subject to any
exceptions adopted by the Committee, such request must generally be
made at least one year prior to expiration of the Deferral Period
for such Deferred Stock award (or such installment).
(vii) Each Deferred Stock award shall be confirmed
by, and shall be subject to the terms of, an agreement executed by
the Company and the participant.
Section 9. Other Stock-Based Awards.
(a) Grant and Exercise. Other Stock-Based Awards which
may include performance shares, and shares valued by reference to
the performance of the Company or any Subsidiary, may be granted
either alone or in addition to or in tandem with Stock Options,
Stock Appreciation Rights, Restricted Stock or Deferred Stock under
this or any other plan of the Company.
The Committee shall determine the eligible persons to
whom, and the time or times at which, such awards shall be made,
the number of shares of Stock to be awarded pursuant to such
awards, and all other terms and conditions of the awards. The
Committee may also provide for the grant of Stock under such awards
upon the completion of a specified performance period.
(b) Terms and Conditions. Each Other Stock-Based Award
shall be subject to the following terms and conditions:
(i) Shares of Stock subject to an Other Stock-Based
Award may not be sold, assigned, transferred, pledged or otherwise
encumbered prior to the date on which the shares are issued, or, if
later, the date on which any applicable restriction, performance or
deferral period lapses.
(ii) The recipient of an Other Stock-Based Award shall be
entitled to receive, currently or on a deferred basis, dividends or
dividend equivalents with respect to the number of shares covered
by the award, as determined by the Committee at the time of the
award. The Committee may provide that such amounts (if any) shall
be deemed to have been reinvested in additional Stock.
(iii) Any Other Stock-Based Award and any Stock
covered by any Other Stock-Based Award shall vest or be forfeited
to the extent so provided in the award agreement, as determined by
the Committee.
(iv) In the event of Retirement, Disability or death of
a participant who is an officer or employee of the Company or any
Subsidiary, or in cases of special circumstances of any
participant, the Committee may waive in whole or in part any or all
of the limitations imposed hereunder (if any) with respect to any
or all of an Other Stock-Based Award.
(v) Each Other Stock-Based Award shall be confirmed by,
and shall be subject to the terms of, an agreement executed by the
Company and by the participant.
Section 10. Change in Control Provisions.
(a) A "Change of Control" shall be deemed to have
occurred on the tenth day after:
(i) any individual, firm, corporation or other entity,
or any group (as defined in Section 13(d)(3) of the Exchange Act
becomes, directly or indirectly, the beneficial owner (as defined
in the General Rules and Regulations of the Securities and Exchange
Commission with respect to Sections 13(d) and 13(g) of the Act) of
more than 20% of the then outstanding shares of the Company's
capital stock entitled to vote generally in the election of
directors of the Company; or
(ii) the commencement of, or the first public
announcement of the intention of any individual, firm, corporation
or other entity or of any group (as defined in Section 13(d)(3) of
the Exchange Act) to commence, a tender or exchange offer subject
to Section 14(d)(1) of the Exchange Act for any class of the
Company's capital stock; or
(iii) the stockholders of the Company approve (1) a
definitive agreement for the merger or other business combination
of the Company with or into another corporation pursuant to which
the stockholders of the Company do not own, immediately after the
transaction, more than 50% of the voting power of the corporation
that survives and is a publicly owned corporation and not a
subsidiary of another corporation, or (2) a definitive agreement
for the sale, exchange or other disposition of all or substantially
all of the assets of the Company, or (3) any plan or proposal for
the liquidation or dissolution of the Company; provided, however,
that a "Change of Control" shall not be deemed to have taken place
if beneficial ownership is acquired by, or a tender or exchange
offer is commenced or announced by, the Company, any
profit-sharing, employee ownership or other employee benefit plan
of the Company, any trustee of or fiduciary with respect to any
such plan when acting in such capacity, or any group comprised
solely of such entities.
(b) In the event of a "Change of Control" as defined in
Section 10(a) above, awards granted under the Plan will be subject
to the following provisions, unless the provisions of this Section
10 are suspended or terminated by an affirmative vote of a majority
of the Board prior to the occurrence of such a "Change of Control":
(i) all outstanding Stock Options, and all Stock
Appreciation Rights (including Limited Stock Appreciation Rights)
shall become exercisable in full, whether or not otherwise
exercisable or fully vested at such time, and any such Stock Option
or Stock Appreciation Right shall remain exercisable in full
thereafter until it expires pursuant to its terms; and
(ii) all restrictions and deferral limitations contained
in Restricted Stock awards, Deferred Stock awards and Other
Stock-Based Awards granted under the Plan shall lapse.
Section 11. Amendments and Termination.
The Board may at any time, and from time to time, amend
any of the provisions of the Plan, and may at any time suspend or
terminate the Plan. The Committee may amend the terms of any award
theretofore granted under the Plan; provided, however, that subject
to Section 3 hereof, no such amendment may be made by the Committee
which in any material respect impairs the rights of the participant
without the participant's consent.
Section 12. Unfunded Status of Plan.
The Plan is intended to constitute an "unfunded" plan for
incentive and deferred compensation. With respect to any payments
not yet made to a participant or optionee by the Company, nothing
contained herein shall give any such participant or optionee any
rights that are greater than those of a general creditor of the
Company.
Section 13. General Provisions.
(a) Investment Representations. The Committee may
require each person acquiring shares of Stock pursuant to a Stock
Option or other award under the Plan to represent to and agree with
the Company in writing that the optionee or participant is
acquiring the shares for investment without a view to distribution
thereof.
All certificates for shares of Stock delivered under the
Plan shall be subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the rules,
regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which the Stock is then listed,
any applicable Federal or state securities law, and any applicable
corporate law, and the Committee may cause a legend or legends to
be put on any such certificates to make appropriate reference to
such restrictions.
(b) Additional Incentive Arrangements. Nothing
contained in the Plan shall prevent the Board from adopting such
other or additional incentive arrangements as it may deem
desirable, including, but not limited to, the granting of stock
options and the awarding of stock and cash otherwise than under the
Plan; and such arrangements may be either generally applicable or
applicable only in specific cases.
(c) Continued Employment. Nothing contained in the Plan
or in any award hereunder shall be deemed to confer upon any
officer, employee or Agent of the Company or any Subsidiary any
right to continued employment with the Company or any Subsidiary,
nor shall it interfere in any way with the right of the Company or
any Subsidiary to terminate the employment of any of its officers
and employees or the relationship of Agents at any time.
(d) Withholding. Not later than the date as of which an
amount first becomes includable in the gross income of the
participant for Federal income tax purposes with respect to any
award under the Plan, the participant shall pay to the Company, or
make arrangements satisfactory to the Committee regarding the
payment of, any Federal, state and local taxes of any kind required
by law to be withheld or paid with respect to such amount. If
permitted by the Committee, tax withholding or payment obligations
may be settled with Stock, including Stock that is part of the
award that gives rise to the withholding requirement. The
obligations of the Company under the Plan shall be conditional upon
such payment or arrangements, and the Company or the participant's
employer (if not the Company) shall, to the extent permitted by
law, have the right to deduct any such taxes from any payment of
any kind otherwise due to the participant from the Company or any
Subsidiary.
(e) Governing Law. The validity, construction and
effect of the Plan and all awards made and actions taken thereunder
shall be governed by and construed in accordance with the laws of
the State of Delaware (without regard to choice of law provisions).
(f) Other Benefit Plans. Any Stock Option granted or
other award made under the Plan shall not be deemed compensation
for purposes of computing benefits under any retirement plan of the
Company or any Subsidiary and shall not affect any benefits under
any other benefit plan now or subsequently in effect under which
the availability or amount of benefits is related to the level of
compensation (unless required by specific reference in any such
other plan to awards under the Plan).
(g) Employee Status. A leave of absence, unless
otherwise determined by the Committee prior to the commencement
thereof, shall not be considered a termination of employment. Any
Stock Option granted or awards made under the Plan to officers and
employees of the Company or any Subsidiary shall not be affected by
any change of employment, so long as the holder continues to be an
employee of the Company or any Subsidiary. If an optionee's
relationship with the Company or any Subsidiary changes (i.e., from
an employee to an Agent), such change shall constitute a
termination of an optionee's employment with the Company or a
Subsidiary, and the optionee's Option shall terminate in accordance
with Section 5(b)(viii) hereof as if the employment of the optionee
terminated by reason of Early Retirement.
(h) Non-Transferability. Except as otherwise expressly
provided in the Plan or in any Stock Option or other applicable
agreement, no right or benefit under the Plan may be alienated,
sold, assigned, hypothecated, pledged, exchanged, transferred,
encumbered or charged, otherwise than by will, by the laws of
descent and distribution or by a Qualified Domestic Relations
Order, and any attempt otherwise to alienate, sell, assign,
hypothecate, pledge, exchange, transfer, encumber or charge the
same shall be void. No right or benefit hereunder shall in any
manner be liable for or subject to the debts, contracts,
liabilities or torts of the person entitled to such benefit.
(i) Applicable Laws. The obligations of the Company
with respect to all Stock Options and awards under the Plan shall
be subject to (A) all applicable laws, rules and regulations and
such approvals by any governmental agencies as may be required,
including, without limitation, the effectiveness of a registration
statement under the Securities Act of 1933, as amended and (B) the
rules and regulations of any securities exchange on which the Stock
may be listed.
(j) Conflicts. If any of the terms or provisions of the
Plan conflict with the requirements of Rule 16b-3 under the
Exchange Act, as in effect from time to time, or with the
requirements of any other applicable law, rule or regulation,
and/or with respect to Incentive Stock Options, Section 422 of the
Code, then such terms or provisions shall be deemed inoperative to
the extent they so conflict with the requirements of said Rule
16b-3, and/or with respect to Incentive Stock Options, Section 422
of the Code. With respect to Incentive Stock Options, if this Plan
does not contain any provision required to be included herein under
Section 422 of the Code, such provision shall be deemed to be
incorporated herein, with the same force and effect as if such
provision had been set out at length herein.
(k) Written Agreements. The Committee may terminate any
Stock Option or other award made under the Plan if a written
agreement relating thereto is not executed and returned to the
Company within 30 days after such agreement has been delivered to
the participant for his or her execution.
(l) Consideration for Stock. The Committee may not
grant any awards under the Plan pursuant to which the Company will
be required to issue any shares of Stock unless the Company will
receive consideration for the shares of Stock sufficient under the
laws of the State of Delaware so that such shares of Stock will be
fully paid and nonassessable when issued.
Section 14. Effective Date of Plan.
The Board approved the Plan on October 4, 1996, and the
Plan became effective on such date (the "Effective Date"). The
Plan shall be governed by the provisions of Rule 16b-3 under
Section 16 of the Exchange Act, as amended by Release Number 34-
37260, and shall not be subject to the phase-in period for such
amendment.
Section 15. Term of Plan.
No Stock Option, Stock Appreciation Rights, Restricted Stock
award, Deferred Stock award or Other Stock-Based Award shall be
granted pursuant to the Plan on or after ten years after the
Effective Date, but awards granted prior to such date may extend
beyond that date.
As of October 4, 1996