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USCS INTERNATIONAL, INC.
EMPLOYEE STOCK PURCHASE PLAN
as amended through November 1, 1996
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The following constitutes the EMPLOYEE STOCK PURCHASE PLAN (the "Plan") of USCS
International, Inc. (the "Company").
1. PURPOSE. The purpose of the Plan is to provide employees of the Company
and its majority-owned U.S. subsidiaries with an opportunity to purchase Common
Stock of the Company through payroll deductions. The Plan is intended to
qualify as an "Employee Stock Purchase Plan" under the provisions of Sections
421 and 423 of the Internal Revenue Code of 1986, as amended (the "Code"). It
is the intention of the Company that the Plan shall not constitute a plan for
any purpose or provision under the Employee Retirement Income Security Act of
1974, as amended (29 U.S.C.A. SECTION 1001 et seq.).
2. DEFINITIONS.
(a) "COMPENSATION" means total wages and other compensation paid to an
Employee by his Employer during the Plan Year and reportable as compensation on
the Employee's Wage and Tax Statement (W-2), but excluding bonuses, taxable
perquisites, relocation assistance payments, and payments made to or on behalf
of an Employee to reimburse him for additional costs and expenses associated
with working outside the United States, plus the amount of any elective deferral
contributions made in accordance with Code sections 125, 129, 401(k), 402(a)(8),
or 402(h) of the Code.
(b) "EMPLOYEE" means any person who (as of the date of payroll
withholding under the Plan), is an employee of the Company (or of its Parent or
U.S. Subsidiary if such employees are to be participants in the Plan). A leased
employee, as described in Section 414(n) of the Internal Revenue Code, is not an
Employee for purposes of this Plan.
(c) "PARENT" means any corporation (other than the Company) in an unbroken
chain of corporations ending with the Company if, at the time of the purchase of
shares by a participant in the Plan, each of the corporations other than the
Company owns stock possessing fifty percent (50%) or more of the total combined
voting power of all classes of stock in one of the other corporations in such
chain.
(d) "U.S. SUBSIDIARY" means any corporation (other than the Company)
incorporated in one of the United States of America in an unbroken chain of
corporations beginning with the Company if, at the time of the purchase of
shares by a participant in the Plan, each of the corporations other than the
last corporation in the unbroken chain owns stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
3. ELIGIBILITY.
(a) Any employee, as defined in Section 2(b), shall be eligible to
participate in the Plan on the first day of the first month following date of
hire.
(b) Notwithstanding any provisions of the Plan to the contrary, no
employee shall be permitted to participate in the Plan: (i) if, immediately
after any purchase of shares under the Plan, such employee would own, directly
or indirectly, shares (including shares issuable upon the exercise of
outstanding options to purchase stock) possessing five percent (5%) or more of
the total combined voting power or value of all classes of shares of the Company
or of its Parent or Subsidiary; or (ii) if such employee's rights to purchase
shares under all employee stock purchase plans of the Company or of its Parent
or Subsidiary will accrue at a rate that exceeds $25,000 of the fair market
value of such shares (determined at the time such purchase option is granted)
for each calendar year in which such right to purchase is
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outstanding at any time.
4. PURCHASE PERIODS. The Plan shall be implemented by calendar quarter
purchase periods during the term of the Plan (each, a "Purchase Period"). The
Company's Board of Directors shall designate the commencement date of the
initial Purchase Period. Thereafter, each Purchase Period shall correspond to a
calendar quarter until otherwise determined by the Board of Directors or the
committee appointed to administer the Plan in accordance with Section 13.
5. PARTICIPATION.
(a) An eligible employee may become a participant in the Plan by
completing an ESPP enrollment form authorizing payroll deductions on the form
provided by the Company and filing it with the Company's benefits office not
less than ten (10) days prior to the commencement of any pay day. Once
enrolled, an employee will continue to participate until he withdraws from the
Plan or his participation is terminated, as provided in Section 10.
(b) Payroll deductions for a participant shall commence on the first pay
day following the receipt of the ESPP enrollment form pursuant to Section 5(a)
above, and shall end upon the participant's withdrawal from the Plan or the
termination of the participant's participation in the Plan, as provided in
Section 10.
(c) From time to time, as necessary, the Board of Directors of the Company
(or the administrative committee for the Plan) may meet with representatives of
any corporation which becomes a Parent or Subsidiary subsequent to the Plan's
adoption date to determine whether and to what extent the employees of such
Parent or Subsidiary shall be eligible to participate in the Plan.
6. PAYROLL DEDUCTIONS.
(a) At the time a participant files his ESPP enrollment form, he shall
elect to have payroll deductions in whole percentages made on each payday during
the Purchase Period at a rate not less than two percent (2%) and not exceeding
ten percent (10%) of the compensation which he receives on such payday, and the
aggregate of such payroll deductions during the Purchase Period shall not exceed
ten percent (10%) of his aggregate compensation during said Purchase Period,
excluding the effect of any increase in the rate of compensation which becomes
effective during the Purchase Period.
(b) All payroll deductions made by a participant shall be applied to
purchase shares on the next share purchase date as set forth in Section 8. A
participant may not make any additional payments into the Plan.
(c) A participant may discontinue his participation in the Plan as
provided in Section 10, or may change the rate of his payroll deductions (within
the limitation set forth in subparagraph (a) above) by completing or filing with
the Company a new ESPP enrollment form for payroll deduction.
7. PURCHASE PRICE.
(a) Each eligible employee participating in the Plan shall have the right
to purchase (at the per share price set forth below) up to the number of shares
of the Company's Common Stock determined by dividing each employee's accumulated
payroll deductions for the Purchase Period of his annual compensation as of
the date of the commencement of the applicable Purchase Period) by the lower of
ninety-five percent (95%) of the fair market value of a share of the Company's
Common Stock on (i) the
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first business day of such Purchase Period or (ii) the last business day of such
Purchase Period, subject to the limitations set forth in Sections 3(b) and 12.
Fair market value of a share of the Company's Common Stock shall be determined
as provided in subsection (b) below.
(b) The fair market value of the Company's Common Stock on any date shall
be determined by the Company's Board of Directors based upon such factors as
they deem relevant; provided, however, that where there is a public market for
the Common Stock, the fair market value per share shall be the average of the
last reported bid and asked prices of the Common Stock, as reported in THE WALL
STREET JOURNAL (or, if not so reported, as otherwise reported by the National
Association of Securities Dealers Automated Quotation (NASDAQ) System) or, in
the event the Common Stock is listed on a national securities exchange (within
the meaning of Section 6 of the Exchange Act) or the NASDAQ National Market
System, the fair market value per share shall be the closing price on such
exchange, as reported in THE WALL STREET JOURNAL, on the date of determination.
8. PURCHASE OF SHARES. Unless a participant withdraws from the Plan as
provided in Section 10, his purchase of shares in any Purchase Period will be
automatic as of the first business day of the next Purchase Period and the
maximum number of shares will be purchased for him at the applicable price
with the accumulated payroll deductions in his account. During the
participant's lifetime, only the participant may purchase shares under the Plan.
9. HOLD PERIOD; DELIVERY OF SHARE CERTIFICATES.
(a) Shares of the Company's Common Stock issued pursuant to this Plan
shall be subject to a six (6) month hold period commencing on the date that such
shares are issued by the Company (the "Hold Period"). No participant may sell,
assign, dispose of by gift or otherwise transfer any shares of the Company's
Common Stock issued pursuant to this Plan prior to the termination of the Hold
Period.
(b) The Company shall maintain a record of all shares issued to
participants in the Plan. Upon the termination of the applicable Hold Period, a
participant in the Plan may request in writing addressed to the director of
benefits of the Company a share certificate for shares of Common Stock issued to
such participant and no longer subject to a Hold Period. Upon receipt of such
written request, the Company shall arrange the delivery to such participant of a
certificate representing the shares purchased by such participant. The
participant will be responsible for paying any administrative fees for
certificate issuance.
10. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) A participant may withdraw from the Plan at any time by giving written
notice to the Company. After receipt of his notice of withdrawal, his
participation in the Plan will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made under the Plan. .
All of the participant's payroll deductions credited to his account prior to
withdrawal will be used to purchase shares at the next share purchase date and
will not be paid to him in cash.
(b) Upon termination of the participant's employment for any reason,
including retirement or death, his participation in the Plan will be
automatically terminated. All of the participant's payroll deductions credited
to his account prior to such termination will be used to purchase shares at the
next share purchase date and will not be paid in cash.
(c) A participant's withdrawal from the Plan will not have any effect upon
his eligibility to participate in the Plan at a future date or in any similar
plan which may hereafter be adopted by the Company, so long as the participant
is otherwise eligible to participate in such plan.
11. INTEREST. No interest shall accrue on the payroll deductions of a
participant in the Plan.
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12. STOCK.
(a) The maximum number of shares of the Company's Common Stock which shall
be made available for sale under the Plan shall be two hundred thousand
(200,000) shares, subject to adjustment upon changes in capitalization of the
Company as provided in Section 18. If the total number of shares which would
otherwise be subject to purchase by participants pursuant to Section 7(a)
exceeds the number of shares then available under the Plan (after deduction of
all shares which have been purchased under the Plan), the Company shall make a
pro rata allocation of the shares remaining available for purchase in as uniform
a manner as shall be practicable, provided that no participant shall be
permitted to purchase more shares than the maximum number of shares allowable to
such participant as calculated pursuant to the provisions of Section 7(a)
hereof. In such event, the Company shall give written notice of such reduction
of the number of shares available for purchase to each employee affected thereby
and shall similarly reduce the rate of payroll deductions, if necessary.
(b) The participant will have no interest or voting right in shares to be
purchased by a participant under the Plan until such shares have been issued by
the Company.
(c) Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the participant and
his or her spouse.
13. Administration. The Plan shall be administered by the Board of Directors
of the Company or a committee appointed by the Board. The administration,
interpretation or application of the Plan by the Board or its committee shall be
final, conclusive and binding upon all participants. Members of the Board of
Directors or its committee who are eligible employees are permitted to
participate in the Plan.
14. Designation of Beneficiary.
(a) A participant may file a written designation of a beneficiary who is
to receive any shares and cash, if any, from the participant's account under the
Plan in the event of such participant's death prior to delivery to him of such
shares and cash. In addition, a participant may file a written designation of a
beneficiary who is to receive any cash from the participant's account under the
Plan in the event of such participant's death.
(b) Such designation of beneficiary may be changed by the participant at
any time by written notice. In the event of the death of a participant and in
the absence of a beneficiary validly designated under the Plan who is living at
the time of such participant's death, the Company shall deliver such shares
and/or cash to the executor or administrator of the estate of the participant,
or if no such executor or administrator has been appointed (to the knowledge of
the Company), the Company, in its discretion, may deliver such shares and/or
cash to the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent or relative is known to the Company,
then to such other person as the Company may designate.
15. TRANSFERABILITY. Neither payroll deductions credited to a participant's
account nor any rights with regard to the receipt of shares under the Plan may
be assigned, transferred, pledged or otherwise disposed of in any way (other
than by will, the laws of descent and distribution or pursuant to a qualified
domestic relations order as defined by the Code or Title I of the Employee
Retirement Income Security Act, or the rules thereunder or as provided in
Section 14) by the participant. Any such attempt at assignment, transfer,
pledge or other disposition shall be without effect, except that the Company may
treat such act as an election to withdraw funds in accordance with Section 10.
16. USE OF FUNDS. All payroll deductions received or held by the Company under
the Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such payroll deductions.
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17. REPORTS. Individual accounts will be maintained for each participant in
the Plan. Statements of account will be given to participating employees
periodically.
18. CHANGES IN CAPITALIZATION. If any shares are purchased under this Plan
subsequent to any stock dividend, stock split, spin-off, recapitalization,
merger, combination, reclassification, exchange of shares or the like, occurring
after such shares were purchased but prior to delivery of the stock certificate
therefor, as a result of which shares of any class shall be issued in respect of
the outstanding shares, or shares shall be changed into the same, whether a
different number of the same or another class or classes, the number of shares
to be issued by the Company and the purchase price for such shares shall be
appropriately adjusted by the Company, as necessary to maintain the equality of
rights and privileges afforded participants and shares issuable under the Plan,
provided that, in any transaction described in Section 424 of the Code, the Plan
shall be administered in such a manner as to satisfy the provisions of Section
424 and the regulations thereunder; and provided further, that any increase in
the aggregate number of shares subject to the Plan (other than an increase
merely reflecting a change in capitalization such as a stock dividend or stock
split) must be approved by the Company's stockholders in accordance with Section
22 hereof.
19. AMENDMENT OR TERMINATION. The Board of Directors of the Company may at any
time terminate, modify, extend or renew the Plan or any rights to purchase
shares granted hereunder; provided that no such modification, extension or
renewal be made without prior approval of the stockholders of the Company if
such amendment would:
(a) Increase the number of shares reserved under the Plan;
(b) Permit payroll deductions at a rate in excess of ten percent (10%) of
the participant's compensation rate;
(c) Materially modify the eligibility requirements; or
(d) Materially increase the benefits which may accrue to participants
under the Plan.
20. NOTICES. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.
21. TERM OF PLAN. The Plan shall become effective upon the earlier to occur of
its adoption by the Board of Directors or its approval by the stockholders of
the Company as described in Section 22. It shall continue in effect for a term
of twenty (20) years unless sooner terminated pursuant to Section 19.
22. APPROVAL OF STOCKHOLDERS. The Plan and any increase in the number of
shares reserved under the Plan must be approved by the stockholders of the
Company within twelve (12) months before or after the date the Plan has been
adopted or an increase in the number of shares reserved under the Plan has been
approved by the Board of Directors. Such stockholder approval shall be by the
affirmative vote of a majority of the capital stock of the Company present or
represented and entitled to vote at a duly held meeting or by the written
consent of the holders of a majority of the outstanding capital stock of the
Company entitled to vote. Any purchases of shares pursuant to the Plan before
stockholder approval is obtained must be rescinded if stockholder approval is
not obtained within twelve (12) months after the Plan is adopted. Such shares
shall not be counted in determining whether such approval is obtained.
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