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CONNING ASSET MANAGEMENT COMPANY
INCENTIVE STOCK OPTION AWARD
Name of Option Recipient: Name
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On November 22, 1996, the Company awarded you a stock option. You
were granted an option to buy 100 shares of the Company's Class B Non-Voting
Common Stock at the price of $7.00 per share.
You may purchase shares under the option as follows:
May be Purchased
Number of Shares Not Before Not After
---------------- ---------- ---------
20 November 22, 1997 November 21, 2006
40 November 22, 1998 November 21, 2006
60 November 22, 1999 November 21, 2006
80 November 22, 2000 November 21, 2006
100 November 22, 2001 November 21, 2006
IMPORTANT: By signing below, you agree to be bound by, and
acknowledge receipt of, the attached Terms and Conditions of this Incentive
Stock Option Award and the Conning Corporation 1996 Flexible Stock Plan.
CONNING CORPORATION
Read and agreed
to this 22nd day of
November, 1996
- ---------------------------------- By: -------------------------------
Name: Leonard M. Rubenstein
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TERMS AND CONDITIONS
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INCENTIVE STOCK OPTION AWARD GRANTED UNDER
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CONNING CORPORATION
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1996 FLEXIBLE STOCK PLAN
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1. Definitions
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(a) Committee The committee of directors (or, in certain cases, their designees) which administers
--------- the Stock Option Plan.
(b) Company Conning Corporation, a Missouri corporation.
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(c) IPO An initial public offering of any class of the Company's capital stock.
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(d) Option The option granted by the Option Award.
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(e) Option Award The Incentive Stock Option Award to which the Terms and
------------ Conditions are attached together with, except where the context
requires otherwise, these Terms and Conditions.
(f) Participant The recipient of an Option Award. Each Participant must be
----------- employed by the Company or an Affiliate of the Company or must
be a director of the Company, and otherwise satisfy the
requirements of Section 422 of the Internal Revenue Code of 1986,
as amended ("Code").
(g) Stock Option Plan The Conning Corporation 1996 Flexible Stock Plan, as amended
----------------- from time to time.
All capitalized terms not otherwise defined herein shall have the meanings
given to such terms by the Stock Option Plan.
2. Evidence of Option Grant and Incentive Stock Option
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The Option Award evidences a grant to the Participant of an Option to
purchase that number of shares ("Optioned Shares") of the par value $.01 per
share Class B Non-Voting
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Common Stock of the Company (or, following the automatic conversion of the Class
B Non-Voting Common Stock, that number of shares of Class A Voting Common Stock
into which such shares of Class B Non-Voting Common Stock would have been
converted had they been outstanding at the time of such automatic conversion)
("Stock") set forth on the Option Award. The Participant may exercise the Option
as shown on the Option Award. In no event shall the Option or any part of the
Option be exercisable after November 21, 2006 (the "Option Expiration Date").
The Option is intended to constitute an "Incentive Stock Option" as defined in
Section 422 of the Code.
3. Exercise of Option
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The Option shall be exercised by the Participant delivering a written
notice of exercise to the Company's Secretary. This notice shall specify
the number of Optioned Shares the Participant then desires to purchase.
4. Payment of Option Price
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Payment for the Shares purchased under the Option shall be made to
the Company either:
(a) in cash (including cashier's check, bank draft or money
order); or
(b) by the tender to the Company of shares owned by the
Participant having a Fair Market Value equal to the
Option price:
(c) in cash, but by means of a so-called "cashless exercise"; or
(d) by any combination of cash and Shares.
In addition to the foregoing methods of payment, payment of the Option price
may, at the discretion of the Committee, be made in whole or in part in
other property, rights and credits, including, to the extent permitted by
applicable law, the Participant's promissory note.
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5. Form of Notice of Exercise
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The Participant's notice as required by Section 3 shall be signed
by the Participant and shall be in substantially the following form with
appropriate adjustments depending on how the Option price is paid:
"I hereby exercise my Option to purchase ------------- Shares in
accordance with my Option Award dated -----------------, 19---,
granted under the Company's 1996 Flexible Stock Plan.
The aggregate Option price of the Shares I am purchasing is
$------------. I hereby tender in payment of such price the following:
(a) my cashier's check, bank draft or money order made payable
to the Company in the amounts of $-------------; and/or
(b) --------- Shares having a Fair Market Value of
$-------------.
I have forwarded to you under separate cover a stock power (with
signature guaranteed) authorizing you to transfer my ----------- Shares as
per the requirements of this letter and my Option Award.
I hereby represent to the Company that I own the -----------
Shares delivered herewith free and clear of all liens and encumbrances
and that I have the full and lawful right to transfer such Shares to the
Company.
If the Shares purchased have not been registered under the
Securities Act of 1933, I hereby further represent to the Company that I
am acquiring the --------- Shares that I am purchasing solely for
investment and solely for my own account and that I have no present
intention of selling or offering for sale any of such Shares to any other
person or persons."
6. Stock Certificates
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Upon the exercise of the Option solely for cash or cash and
property (other than Stock), rights and/or credits specifically permitted by
the Committee, the Participant shall be entitled to one Stock certificate
evidencing the Shares acquired upon exercise. However, if the Participant
delivers Stock of the Company when exercising the Option, then the
Participant shall be entitled to two or three certificates.
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If the number of Shares tendered is less than or equal to the
number required to pay for all of the Shares purchased, then the Participant
shall be entitled to receive two certificates. One certificate shall
represent a number of Shares equal to the number of Shares delivered by the
Participant. The second certificate shall represent the additional Shares
acquired by the Participant upon the exercise of the Option.
If the number of Shares tendered is more than the number
required to pay for all of the Shares purchased, then the Participant shall
be entitled to receive three certificates, one for the portion of the number
of Shares purchased which is equal to the number of tendered Shares applied
to exercise the Option, a second for the remainder of the number of Shares
purchased upon exercise of the Option, and a third for the number of Shares
tendered which were not applied to purchase the Shares pursuant to the
Option.
7. Legends on Certificates
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The certificate or certificates to be issued under Section 6
shall be issued as soon as practicable. Such certificate or certificates
shall contain thereon a legend in substantially the following form if the
Shares evidenced by such certificate have not been registered under the
Securities Act of 1933, as amended:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933 or any applicable state
law. They may not be offered for sale, sold, transferred or pledged
without (1) registration under the Securities Act of 1933 and any
applicable state law; or (2) at holder's expense, an opinion
(satisfactory to the Company) that registration is not required."
The certificates shall also contain such other legends as may be appropriate
or required by law, such as a legend relating to any shareholders' agreement
that may apply to the Shares.
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8. Termination of Employment; Nonassignability
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8.1 Termination of Employment or Status as Director. If, on or
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after the date that the Option shall have first become exercisable, the
Participant's employment shall be terminated for any reason, the Participant
shall have the right, within 3 months after such termination (but not later
than the Option Expiration Date), to exercise such Option to the extent that
such Option or any installment thereof shall have accrued at the date of
such termination and shall not have been exercised. In the event of the
Participant's death during such 3 month (or shorter) period, the provisions
of Section 8.4 shall apply. For purposes of this Section, termination of
employment shall be deemed to occur on the later of the termination of a
Participant's employment with the Company or an Affiliate or a Participant's
ceasing to serve as a director of the Company.
8.2 Disability. If, on or after the date that the Option shall
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first have become exercisable, the Participant's employment shall be
terminated for disability (as such term is defined at Section 422(c)(6) of
the Code), the Participant shall have the right, within 1 year after such
termination (but not later than the Option Expiration Date), to exercise
such Option to the extent that such Option or any installment thereof shall
have accrued at the date of such termination of employment and shall not
have been exercised. In the event of the Participant's death during such 1
year (or shorter) period, the provisions of Section 8.4 shall apply.
8.3 Intentionally Omitted.
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8.4 Death. If a Participant shall die within the 3 month (or
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shorter) period referred to in Section 8.1 or the 1 year (or shorter) period
referred to in Section 8.2 or while in the employ or serving as a director of
the Company or an Affiliate on or after the date that the Option shall have
first become exercisable, the beneficiary designated pursuant to Section 8.6
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hereof, or, if no such designation is in effect, the personal representative of
the estate of the decedent or the person or persons to whom the Option shall
have been validly transferred by such personal representative pursuant to will
or the laws of descent and distribution, shall have the right, within 1 year
from the date of the Participant's death (but no later than the Option
Expiration Date), to exercise the Participant's Option to the extent that such
Option or any installment thereof shall have accrued at the date of death and
shall not have been exercised. No transfer of the Option shall be effective to
bind the Company unless the Company shall have been furnished with written
notice of such transfer and a copy of the will and/or such other evidence as the
Committee may deem necessary to establish the validity of the transfer. No
transfer shall be effective without the acceptance by the transferee of the
terms and conditions of such Option and the terms and conditions of any
shareholders' agreement applicable to the Option.
8.5 Option Not Vested. If a Participant's employment shall
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terminate before the Option shall have first become exercisable, or before
any installment or installments are exercisable, then the Participant's full
interest in the Option or such installment or installments, as the case may
be, shall terminate and all rights thereunder shall cease. For purposes of
this Section, termination of employment shall be deemed to occur on the
later of the termination of a Participant's employment with the Company or
an Affiliate or a Participant's ceasing to serve as a director of the
Company.
8.6 Non-Transferability of Rights, Designation of Beneficiaries.
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The Option shall not be transferable by the Participant otherwise than by
will or the laws of descent and distribution or as provided in this Section
8.6. During the lifetime of the Participant, the Option shall be
exercisable only by the Participant.
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The Participant, however, may file with the Company a written
designation of a beneficiary or beneficiaries to exercise, in the event of
death of the Participant, the Option granted hereunder, subject to all of
the provisions of this Section 8. A Participant may from time to time
revoke or change any such designation of beneficiary and any designation of
beneficiary under the Plan shall be controlling over any other disposition,
testamentary or otherwise; provided, however, that if the Committee shall be
in doubt as to the right of any such beneficiary to exercise the Option, the
Committee may determine to recognize only an exercise by the personal
representative of the estate of the Participant, in which case the Company,
the Committee and the members thereof shall not be under any further
liability to anyone.
8.7 Limitation on Extensions. Certain provisions hereof extend
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the date by which the Option must otherwise be exercised under the
provisions of Section 1 and the Option Award. Notwithstanding those
provisions herein which otherwise extend the time period in which the Option
must be exercised, no extension may extend the Option later than the day
immediately preceding the tenth annual anniversary date of the date hereof.
9. Withholding.
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The Company or any Affiliate that employs the Participant shall have
the right to deduct any sums that federal, state or local tax law requires to be
withheld with respect to the exercise of the Option, or as otherwise may be
required by such laws. The Company or any such Affiliate may require as a
condition to issuing Stock upon the exercise of the Option that the Participant
or other person exercising the Option pay any sum that federal, state or local
tax law requires to be withheld with respect to such exercise. In the
alternative, the Participant or other person exercising the Option may elect to
pay such sums to the Company or the Affiliate by delivering written notice of
that election to the Company's Secretary prior to or concurrently
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with exercise. There is no obligation that the Participant be advised of the
existence of the tax or the amount which the employer corporation will be so
required to withhold.
10. Changes in Capital Structure.
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If there is any change in the capital structure of the Company, or if
there shall be any dividend upon the Stock, payable in Stock, or if there shall
be a Stock split, spin-off, split-up, spin-out, recapitalization, merger,
consolidation, reorganization, combination or exchange of shares, the maximum
aggregate number of shares with respect to which Options may be exercised
hereunder and the number and the Option Price of the shares of Stock with
respect to which the Option has been granted hereunder, shall be proportionately
adjusted by the Committee as it deems equitable, in its absolute discretion, to
prevent dilution or enlargement of the rights of the Participant. The issuance
of Stock for consideration and the issuance of Stock rights shall not be
considered a change in the Company's capital structure. No adjustment provided
for in this section shall require the issuance of any fractional shares.
11. Stock Option Plan Controls
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The Option Award and these Terms and conditions are subject to all
terms and provisions of the Stock Option Plan which is incorporated herein by
reference. In the event of any conflict, the Stock Option Plan shall control
over the Option Award and these Terms and Conditions.
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