EXHIBIT 4.4
1994 OMNIBUS STOCK OPTION PLAN
OF
STANDARD MOTOR PRODUCTS, INC.
[AS AMENDED AND RESTATED EFFECTIVE AS OF MAY 18, 2000]
1. PURPOSE. The purpose of this Stock Option Plan is to advance the
interest of Standard Motor Products, Inc., a New York corporation (the
"Company"), by encouraging and enabling the acquisition of a larger personal
proprietary interest in the Company by key employees of the Company and its
Subsidiaries (as hereinafter defined) and by other individuals upon whose
judgment and commitment the Company is largely dependent for the successful
conduct of its operations. It is anticipated that the acquisition of such
proprietary interest in the Company will stimulate the efforts of such
individuals on behalf of the Company and strengthen their desire to remain
associated with the Company and its Subsidiaries as well as enable the Company
to attract valuable employees.
2. DEFINITIONS. When used in this Plan, unless the context otherwise
requires:
(a) "Board of Directors" shall mean the Board of Directors of the
Company, as constituted from time to time, and as elected at the
Company's annual shareholders' meeting.
(b) "Cause" means a finding by the Board based upon reasonable
evidence presented in writing to the individual that the
individual engaged in a criminal act or a willful misconduct or
neglect inconsistent with his employment responsibilities or
contractual relationship with the Company any of which resulted
in harm to the Company.
(c) "Chief Executive Officer" shall mean the person(s) who at the
time shall be Chief Executive Officer or Co-Chief Executive
Officers of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Fair Market Value" of a Share at any particular time shall mean
with respect to common stock, the average of the high and low
sale prices per share of the Company's Common Stock on the New
York Stock Exchange on the date of a grant.
(f) "Incentive Stock Option" shall mean any stock option issued
pursuant to the Plan which qualifies as an incentive stock option
under Section 422 of the Code.
(g) "Non-Qualified Option" shall mean any stock option issued
pursuant to the Plan which is not an Incentive Stock Option.
(h) "Option" shall mean either an incentive Stock Option or a
Non-Qualified Option issued pursuant to the Plan.
(i) "Plan" shall mean this 1994 Omnibus Stock Option Plan of Standard
Motor Products, Inc., adopted by the Board of Directors at its
meeting held on April 8, 1994, as such Plan from time to time may
be amended. The effective date of this amendment and restatement
is May 18, 2000.
(j) "Share" shall mean a share of the Company's Common Stock, par
value $2.00 per share.
(k) "Subsidiary" shall mean an entity, 50% or more of the stock of
which having ordinary voting power is owned or controlled by the
Company.
3. COMMITTEE. The Plan shall be administered by the President or the Chief
Financial Officer of the Company or their designee(s). The Compensation
Committee of the Company, however, shall have control of the terms and
provisions of the Plan, including the right to amend the Plan as further defined
in Section 15.
4. PARTICIPANTS. Except for members of the Compensation Committee, who are
ineligible to receive option grants, all persons who now are, or who during the
term of the Plan become, key employees of the Company or any of its Subsidiaries
shall be eligible to receive Options under the Plan. The individuals to whom
Options are to be granted under the Plan, and the number of Shares to be subject
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to such Options shall be determined by the Compensation Committee in its sole
discretion, subject, however, to the terms and conditions of the Plan. A person
shall not be disqualified from receiving Options under the Plan solely because
he or she already holds a stock option of the Company or a Subsidiary, whether
granted pursuant to the Plan or otherwise.
5. GRANT OF OPTION. The Compensation Committee may, but shall not be
required to, grant Options with respect to an aggregate of not more than
1,500,000 Shares subject to adjustment pursuant to Section 13 hereof. Such
Shares may be either treasury Shares or authorized but unissued shares. Options
granted under the Plan to an employee of the Company or any of its Subsidiaries
may either be Incentive Stock Options or Non-Qualified Options, as the
Compensation Committee shall designate. No grant of an Option may exceed 50,000
shares. In addition, no more than one grant can be made to any individual in any
calendar year.
Except as provided below, the number of Shares with respect to which
Options may be granted to any eligible individual shall be determined by the
Compensation Committee in its sole discretion. Notwithstanding any other
provision of this Plan to the contrary, the aggregate Fair Market Value
(determined as of the time an Option is granted) of the Shares with respect to
which any individual employee may be granted Options which are Incentive Stock
Options, and which becomes exercisable for the first time in any one calendar
year (under this Plan and all other stock option plans maintained by the Company
or any of its Subsidiaries), shall not exceed $100,000.
To the extent that an Option shall expire or terminate for any reason,
without having been exercised in full, Options may again be issued under the
Plan with respect to the Shares for which the expired or terminated Option had
not been exercised.
A Certificate of Option or Option Agreement, in form determined by the
Compensation Committee and signed by the Chairman of the Board, the President or
the Chief Financial Officer of the Company, attested by the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary of the Company,
and having the seal of the Company affixed hereto, shall be delivered to each
person to whom an Option is granted. Each Certificate of Option or Option
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Agreement shall bear a legend indicating its status as either an Incentive Stock
Option or Non-Qualified Option, and shall contain the term designated by the
Compensation Committee pursuant to the Plan and such other terms and conditions,
not inconsistent with the Plan, as the Compensation Committee deems necessary or
appropriate.
6. PRICE. The purchase price per Share for the Shares to be purchased
pursuant to the exercise of any Option (the "Option Price") shall be fixed by
the Compensation Committee at the time of the grant of the Option and shall be
at least equal to 100% of the Fair Market Value of a Share on the date such
Option is granted; provided, however, that if an Option that is intended to
qualify as an Incentive Stock Option is issued to an employee who owns more than
ten percent (10%) of the combined voting power of all classes of stock of the
Company or any of its Subsidiaries ("10% owner"), then the Option Price for such
Option shall be at least equal to 110% of the Fair Market Value of a Share on
the date the Option is granted. Subject to the foregoing provisions, the
Compensation Committee shall have full authority and discretion and be fully
protected in fixing an Option Price. In determining whether a person is a l0%
owner, such person shall be considered the owner of stock in accordance with
Section 424 of the Code (or any successor provision of law) and will be deemed
to have exercised all then outstanding stock options granted to such person to
acquire stock of the Company or a Subsidiary, whether or not such stock options
were granted under the Plan.
Except as otherwise permitted below, payment of the Option Price pursuant
to the exercise of an Option shall be made in full at the time of the exercise
of the Option, either in cash, or by certified check payable to the order of the
Company. In addition, if the Compensation Committee in its discretion deems it
advisable, it may provide when an option is granted that the Option Price or any
portion the individual exercising such Shares, valued at their then Fair Market
Value, may be exercised, in whole or in part through the surrender of previously
acquired Shares of the Company at their full market value on the exercise date
or through other financial arrangements made with a stock broker.
7. DURATION OF OPTIONS. Except as provided below, each Option granted under
the Plan shall provide that it may not be exercised after ten years from the
date upon which the Option was granted, or such lesser period as determined by
the Compensation Committee in its discretion. However, any Option granted to a
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10% owner that is intended to qualify as an Incentive Stock Option shall provide
that it may not be exercised after five years after the date upon which the
option was granted, or such lesser period as determined by the Compensation
Committee in its discretion.
8. CONSIDERATION FOR OPTIONS. An individual designated by the Compensation
Committee to receive an Option under the Plan shall not be required to make any
cash payment in consideration of the grant of such Option. However, the
Compensation Committee in its discretion may require such other consideration as
it deems appropriate for the grant of an Option, including, without limitation,
by providing that the exercise of the Option is conditioned upon the holder's
continued employment by or other affiliation with the Company or a Subsidiary.
9. NON-TRANSFERABILITY OF OPTIONS. Options shall not be transferable by the
holder thereof, otherwise than by will or the laws of descent and distribution
to the extent provided in Section 12 hereof. Options may be exercised or
surrendered during the holder's lifetime only by the holder thereof; provided,
however, that in the event that an Option holder becomes legally incapacitated
and a representative or committee is appointed to act on his or her behalf, such
representative or committee may exercise any Options that are held by the
incapacitated Option holder to the same extent as the holder could have had he
or she not suffered such incapacity.
10. EXERCISE OF OPTIONS. Except as otherwise provided herein, an Option
after the grant thereof, shall be exercisable by the holder at such rate and
times as may be fixed by the Compensation Committee, but not sooner than
approval of the Plan by stockholders of the Company as provided in Section 16
hereof. No Option may be exercised until the first anniversary of the date upon
which the Option was granted. Subject to the approval of the Compensation
Committee and the provisions of Section 15, the following grants of Options
shall be offered under the Plan:
(a) The Option granted hereby shall remain exercisable, unless otherwise
determined by the Compensation Committee, until the fifth anniversary of the
date of the vesting of such Option, to the extent it has not theretofore been
exercised.
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(b) The option granted hereby shall become exercisable at the discretion of
the Compensation Committee either with cliff vesting or graded vesting. If
graded vesting, the vesting will occur over equal periods, not to exceed five
years. For example, if vesting is to occur over four years then 25% of the
Shares subject to an Option may be purchased on or after the first anniversary
of the Option's date of grant and an additional 25% of the Shares subject to the
Option may be purchased on or after each of the second, third and fourth
anniversaries, respectively, of the Option's date of grant, but in each case
prior to the Option's expiration date.
Notwithstanding anything to the contrary and for purposes of granting
Options in accordance with (b) above, the Compensation Committee shall retain
the right to require that with respect to any vesting of such Option, the Option
holder must acquire and continue to directly own shares of the Company's Common
Stock in an amount equivalent to no more than 50% of such Option holder's
applicable base salary for the applicable year(s). For purposes of determining
the ownership level, shares of the Company's Common Stock shall include all
shares owned directly by the Option holder. At the option of the Compensation
Committee, no more than 50% of the vested shares under the Standard Motor
Products, Inc. Employee Stock Ownership Plan may be considered in determining
the ownership level. If the Option holder does not possess the requisite
ownership level at the date of an initial option grant under this Plan, then the
Option holder shall be permitted a two-year period, measured from the date of
the initial grant awarded to the Optionee under this Plan, to acquire the shares
of the Company to satisfy the ownership requirement.
The Compensation Committee shall have the right to authorize the
availability to Plan participants of interest-bearing loans from the Company at
interest rates set by the Compensation Committee with payment terms not to
exceed four (4) years. Such loan is to be used solely for the purchase of the
Company's Common Stock to meet the initial ownership requirement under the Plan
up to an amount equal to seventy-five percent of an Optionee's required
ownership level. Additional loans to fund the future acquisition of the
Company's Common Stock as required by base wage increases are not permitted.
Such loans are to be secured by the Company's Common Stock.
Notwithstanding the foregoing, if an Option holder attains age 65 while
employed by the Company or any of its Subsidiaries, such Option as granted under
(a) above, shall become exercisable in full at that time that the Plan has been
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approved by the stockholders of the Company as provided in Section 16 hereof. In
addition, on account of total disability or death of the Option holder, the
vesting of such Options shall automatically accelerate. The Compensation
Committee may also accelerate the vesting of the Options under (b) above upon an
Option holder's termination of employment with the Company, subject to Section
12.
An Option shall be exercised by the delivery of a written notice duly
signed by the holder thereof to such effect by the Certificate of Option or
Option Agreement and, in the case of exercise of an Option, by full payment of
the Option Price for the Shares to be purchased pursuant to such exercise. Such
deliveries shall be made to the officer of the Company appointed by either the
Chairman of the Board or the Compensation Committee for the purpose of receiving
the same.
Within a reasonable time after exercise of an Option, the Company shall
cause to be delivered to the person entitled thereto a certificate for the
Shares purchased pursuant to exercise of the Option. All such Shares and
certificates shall be issued in the name of the person who is entitled at the
time to exercise the Option or, if such person is the original holder and so
elects, in the name of such person and his or her spouse as joint tenants with
right of survivorship. If the Option shall have been exercised with respect to
less than all of the Shares subject thereto, then the Company shall also cause
to be delivered to the person entitled thereto a new Certificate of Option or
Option Agreement in replacement of the certificate or agreement surrendered at
the time of the exercise, indicating the number of shares with respect to which
the Option remains available for exercise, or else the original certificate or
agreement shall be enclosed to give effect to the partial exercise thereof.
11. TAX WITHHOLDING. In the event that the holder of an Option elects to
exercise his or her Options or any part thereof pursuant to Section 10 hereof,
and the Company or a Subsidiary shall be required to withhold any amount with
respect to such exercise by reason of my federal, state or local tax laws, rules
or regulations, then the Company or such Subsidiary shall be entitled to deduct
and withhold any amounts from any payments (including but not limited to
payments in Shares) to be made to the holder, whether in connection with such
exercise or otherwise. In any event, the holder shall make available to the
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Company or such Subsidiary, promptly when requested by the Company or such
Subsidiary, sufficient funds or other property (including, but not limited to,
Shares) to meet the requirements of such withholding; and the Company or
Subsidiary shall be entitled to take and authorize such steps as it may deem
advisable in order to have the amounts required to be withheld made available to
the Company or such Subsidiary out of any funds or property (including, but not
limited to, Shares) due or to become due to the holder.
12. TERMINATION OF EMPLOYMENT OR OTHER RELATIONSHIP. If an Option holder's
employment by the Company and its Subsidiaries shall terminate for any reason
other than discharge for Cause, retirement on or after age 65, total disability
(to an extent, if any and in a manner as shall be determined by each case by the
Compensation Committee in its sole discretion), or death, then such Option
holder or the representative of the estate or the heirs of a deceased Option
holder, as the case may be, shall have until the earlier of the end of the 90th
business day following such cessation of employment, as the case may be, or the
expiration date of the Option, and no longer, to exercise any unexercised
portion of such Option that he could have exercised on the day on which such
employment services terminated. If the employment of an Option holder with the
Company and its Subsidiaries is terminated for Cause (the determination of
whether such termination was for Cause to be made by the Compensation Committee
in its sole discretion which shall be conclusive) then all Options held by such
holder shall terminate immediately, and an Option holder whose employment is so
terminated shall have no right on and after such termination to exercise any
then unexercised portion of such options notwithstanding the holder's right to
exercise all or a portion of such Options prior to termination.
Notwithstanding any part of the foregoing to the contrary, Options may not
be exercised prior to the approval of the Plan by the stockholders of the
Company as provided in Section 16 hereof.
The Compensation Committee in its discretion may provide when it grants an
Option that, notwithstanding any provision of the Plan or a Certificate of
Option or Option Agreement to the contrary, the Option Price payable upon the
exercise of an Option after the termination of the Option holder's employment,
may only be paid upon exercise and in cash or by certified check.
An Option holder's transfer, without interruption in service, between the
Company and its Subsidiaries during the term of an Option granted under the Plan
shall not be considered a termination of employment or other relationship for
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purposes of the Plan. An Option holder's rights shall not be affected by
any change in duties or position after an Option is granted to him or her under
the Plan, so long as the Option holder continues to be employed by the Company
or a Subsidiary. Whether an authorized leave of absence or absence for military
or governmental service shall constitute termination of employment or other
relationship for purposes of the Plan shall be determined by the Compensation
Committee in its sole discretion.
Nothing contained herein or in any Certificate of Option or Option
Agreement shall be construed to confer on any employee or other individual any
right to continue to be employed by the Company or a Subsidiary or derogate from
any right of the Company or a Subsidiary to retire, request the resignation of
or discharge such individual (without or with pay), at any time with or without
cause.
13. ADJUSTMENT OF SHARES. If prior to the complete exercise of any Option
there shall be declared and paid a stock dividend upon the shares or if the
Shares shall be split up, converted, exchanged, reclassified, combined or in any
way substituted for, the Option to the extent that they have not been exercised,
shall entitle the holder upon the future exercise of the Option to purchase such
number and kind of securities or other property subject to the terms of the
Option which he or she would have been entitled to receive had he or she
actually owned the Shares subject to the unexercised portion of the Option at
the time of the occurrence of such event; and the aggregate Option Price payable
upon the future exercise of the Option shall be the same as if the original
shares were being purchased thereunder. Any fractional Shares or other
securities which may be issuable upon the exercise of the Option as a result of
such adjustment shall be payable in cash based upon the Fair Market Value of
such Shares or other securities as of the time of such exercise. If any such
event should occur, the number of Shares with respect to which Options remains
to be granted, or with respect to which Options may again be granted, shall be
similarly adjusted.
If the Board of Directors approves or authorizes the dissolution or
liquidation of the Company, or the reorganization, merger or consolidation of
the Company with one or more corporations as a result of which either the
Company will become a wholly-owned subsidiary of another corporation or neither
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the Company nor a Subsidiary is the surviving corporation, or the sale of all or
substantially all of the assets of the Company other than to a Subsidiary, or if
a tender offer for the Common Stock (or any other capital stock of the Company
or a Subsidiary for which all the Common Stock has heretofore been exchanged or
into which it has been changed (the "Recapitalized Stock")) shall commence, or,
if during any twelve-month period, a majority of the members of the Board of
Directors are replaced with newly elected individuals, or such existing
directors cease to constitute a majority of the Board of Directors, unless such
new directors were nominated by the management of the Company (each of the
foregoing being referred to hereinafter as an "Extraordinary Transaction"), or,
if after the adoption of the Plan, any individual, corporation other entity or
any group (within the meaning of Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended), which is unaffiliated with the Company or a Subsidiary
other than as a stockholder of the Company, acquires, directly or indirectly,
within any twelve-month period shares of the Common Stock or any class of
Recapitalized Stock with full voting rights (excluding any shares issued in any
acquisition or reorganization approved by the Board of Directors in which the
Company is the surviving corporation or in control of the surviving corporation
and any shares issued by the Company in a public or private offering), such that
such individual, corporation, other entity or group becomes, directly or
indirectly, after the adoption of the Plan, the holder of Common Stock or such
Recapitalized stock representing 25 percent or more of the then current ordinary
voting power of the Company's stock (a "Substantial Change in Ownership"), then,
effective upon the Board of Director's approval of the Extraordinary Transaction
(other than a tender offer), the commencement of the tender offer, or the
occurrence of the Substantial Change in Ownership, as the case may be, the time
when each then outstanding Options granted under the Plan may be exercised shall
automatically be accelerated so that each holder thereof may exercise his or her
Options in full or in any part prior to the consummation of the Extraordinary
Transaction or promptly after a Substantial Change in Ownership. For the
purposes of determining if a Substantial Change in Ownership has occurred, an
individual, corporation, other entity or group shall not be deemed to hold any
Common Stock or Recapitalized Stock issuable upon the conversion of any
convertible securities of the Company or a Subsidiary or upon the exercise of
any option or warrant for or other right to purchase Common Stock or
Recapitalized Stock unless such Common Stock or Recapitalized Stock has actually
been issued upon
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conversion or exercise. Where any Option, the exercise date of which has been
accelerated pursuant to this paragraph, is thereafter exercised, the Option
Price may be paid in any manner and upon the terms permitted by the applicable
Option.
The Compensation Committee's determination as to adjustments to be made
pursuant to this Section 13 shall be final, binding and conclusive.
14. ISSUANCE OF SHARES COMPLIANCE WITH SECURITIES LAWS. The Company may
postpone the issuance and delivery of Shares upon any exercise of an Option
until (a) the admission of such Shares to listing on NYSE or any stock exchange
or exchanges on which Shares are then listed and (b) the completion of such
registration or other qualification of such Shares or such filings under any
federal or state law, rule or regulation as the Company shall determine to be
necessary or advisable. Any person exercising any Option shall make such
representations and furnish such information as may, in the opinion of counsel
for the Company, be appropriate to permit the Company to issue the Shares in
compliance with the provisions of applicable federal and state securities laws,
rules, and regulations. The Company shall have the right, in its sole
discretion, to issue "stop transfer" instructions for, and to place an
appropriate legend on the certificates for, any Shares which may be issued upon
exercise of an Option. Nothing in the Plan or any Certificate of Option or
Option Agreement shall be construed to require the Company to register the Share
issued or issuable under the Options under the Securities Act of 1933, as
amended, or under any applicable state securities law.
15. AMENDMENT AND ADMINISTRATION OF THE PLAN. Except as hereinafter
provided, the Compensation Committee may at any time withdraw or from time to
time amend the Plan and the terms and conditions of any Options not theretofore
granted, and the Compensation Committee may, with the consent of the affected
holder of any Option, at any time or from time to time amend the terms and
conditions of such Options as have been theretofore granted. Notwithstanding the
foregoing, (i) neither the Board of Directors nor the Compensation Committee may
take any action which would result in the failure of any Incentive Stock Option
to meet the requirements of Section 422 of the Code and (ii) neither the Board
of Directors nor the Compensation Committee may take any of the following
actions unless the holders of a majority of the Company's stock entitled to vote
approve such action within one year before or after it is taken:
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(a) materially increase the total number of Shares for which Options may be
granted under the Plan in the aggregate or to any one person;
(b) change the minimum Option Price for Shares subject to Options;
(c) permit an Option to be exercised earlier than one year after it is
granted;
(d) extend the termination date of the Plan; or
(e) take any other action with respect to the Plan which under the Code
would be deemed the adoption of a new plan or which, under Rule 16b-3
promulgated pursuant to the Securities Exchange Act of 1934, would require
approval of the Company's stockholders.
To the extent not inconsistent with the Plan, the Compensation Committee
may authorize and establish such rules and regulations as it may determine to be
advisable to make the Plan Options effective or to provide for their
administration, and may take such other action with regard to the Plan Options
as it shall deem desirable to effectuate their purpose. The Compensation
Committee shall have the authority to interpret the Plan as it may deem
advisable and to make determinations which shall be final, binding and
conclusive upon all persons. No member of the Board of Directors or the
Compensation Committee shall be liable for any action or determination made in
good faith with respect to the Plan or any Option granted under it.
16. APPROVALS. This Plan is conditioned upon its approval by the holders of
a majority of the stock of the Company entitled to vote, present in person or by
proxy, at any special or annual meeting, on or before May 26, 1994; provided,
however, that the Plan is adopted and approved by the Board of Directors. Any
Options granted under the Plan prior to such approval shall be granted subject
to such approval, and in the event that this Plan is not approved by the
stockholders of the Company as aforesaid, this Plan shall be void and of no
force and effect, and any Options that may have been granted shall be void and
of no force or effect.
17. APPLICABLE LAW. The Plan and all Options granted pursuant to it are
subject to all applicable laws and the rules and regulations of governmental
authorities. Notwithstanding any provisions of the Plan or any Option to the
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contrary, no option holder shall be entitled to exercise an Option or any other
right under the applicable Option, and the Company shall not be obligated to
issue any Shares to such holder or to take any other action under the applicable
Option, if such exercise, issuance or other action would constitute a violation
of any law, rule, or regulation applicable to the Option holder or the Company
or of any order, judicial decision, or material agreement to which the Company
is a party or by which it is bound. The Plan will be administered in accordance
with and governed by the laws of the state of New York.
18. FINAL ISSUANCE DATE. No Option shall be granted under the Plan after
May 25, 2004.
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