EXHIBIT 4.7
PXRE CORPORATION
DIRECTOR STOCK OPTION PLAN
SECTION 1. PURPOSE
The purpose of the Plan is to secure for PXRE Corporation and
its stockholders the benefits inherent in increased common stock ownership by
directors of the Company who are not employees of the Company or any of its
subsidiaries.
SECTION 2. DEFINITIONS
Whenever used in this plan, the following terms shall have the
definitions set forth in this section:
2.1 "Board of Directors" shall mean the Board of
Directors of PXRE Corporation.
2.2 "Change of Control" has the meaning provided in
Section 7.2 of the Plan.
2.3 "Code" shall mean the Internal Revenue Code of
1986, as amended.
2.4 "Company" shall mean PXRE Corporation.
2.5 "Date of Grant" shall mean the date of the Annual
Meeting as of which a Director is granted an Option
under Section 5.1.
2.6 "Director" shall mean a member of the Board of
Directors who is not a full-time employee of the
Company or a subsidiary.
2.7 "Disability" shall mean the inability, in the
judgment of the Board, of a Director to perform his
or her duties due to mental or physical impairment.
2.8 "Effective Date" shall mean the date provided in
Section 12 of the Plan.
2.9 "Fair Market Value" as of any day shall mean the
arithmetic mean of the per share bid and asked price
for Shares on such day as reported by the NASDAQ
Interdealer Quotation System, or if the shares are
listed on an exchange, the average of the high and
low per share prices quoted for Shares on such date.
If the Shares are not publicly traded, Fair Market
Value shall be determined by the Board in a manner
consistent with the requirements of Section 422 of
the Code.
2.10 "Option" shall mean an option to purchase Shares
granted under Section 5 of the Plan.
2.11 "Retirement" shall mean retirement from the Board as
of the Annual Meeting of Stockholders coinciding with
or next following the Director's attainment of age of
72.
2.12 "Rule 16b-3" shall mean Rule 16b-3 promulgated under
the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
2.13 "Shares of stock" or "Shares" shall mean shares of
the Common Stock, par value $0.01 per share, of the
Company.
2.14 "Term-year" shall mean the period from one Annual
Meeting to the subsequent Annual Meeting.
SECTION 3. AMOUNT OF STOCK
The stock which may be issued and sold under the Plan shall
not exceed 100,000 Shares, subject to adjustment as provided in Section 6 below.
The Shares to be issued may be either authorized and unissued shares, treasury
shares, issued shares acquired by the Company or its subsidiaries or any
combination thereof. In the event that Options granted under the Plan shall
terminate or expire without being exercised in whole or in part, new Options may
be granted covering the shares not purchased under such lapsed Options.
SECTION 4. ELIGIBILITY
Each Director shall be eligible to receive an Option in
accordance with Section 5 below.
SECTION 5. TERMS AND CONDITIONS OF OPTIONS
Each Option granted under the Plan shall be evidenced by an
agreement in such form as the Board shall prescribe from time to time in
accordance with the Plan and shall comply with the following terms and
conditions:
5.1 Grants. As of the date of the Annual Meeting of
Stockholders of the Company each year on and after the Effective Date, each
Director who has been elected or re-elected or who is continuing as a member of
the Board as of the adjournment of the Annual Meeting shall automatically
receive an Option for 1,000 Shares.
5.2 Exercise Price. The Option exercise price shall be the
Fair Market Value of the Shares on the Date of Grant of the Option.
5.3 Vesting. Except as provided in Sections 5.4, 5.5 and 7.1,
no portion of an Option shall be exercisable prior to the Director's completion
of one Term-year on the Board next following the Date of Grant, and thereafter
the Option shall be exercisable with respect to 333 Shares on and after the
Director's completion of his or her first Term-year following the Date of Grant,
it shall be exercisable for an additional 333 Shares on and after the Director's
completion of a second Term-year following the Date of Grant, and it shall be
exercisable for the remaining 334 Shares on or after the Director's completion
of a third Term-year after the Date of Grant.
5.4 Option Expiration. No portion of an Option shall be
exercisable after the expiration of ten years from the Option's Date of Grant.
5.5 Exercise When No Longer a Director. No Option shall be
exercisable unless the person exercising the Option has been, at all times
during the period beginning with the Date of Grant of the Option and ending on
the date of such exercise, a Director of the Company, except that:
(a) Retirement or Disability. If such a person shall
cease to be a Director by reason of Retirement or Disability
while holding an Option (whether or not then exercisable)
that has not expired, such person may, at any time within
three years following such termination (but in no event after
the Option has expired under the provisions of Section 5.4),
exercise the Option with respect to any shares as to which
such person has not exercised the Option on the date the
person ceased to be a Director; provided, however, that no
Shares issuable on exercise of the Option may be sold,
assigned, pledged or otherwise transferred for the period of
time after the date of the grant of the Option as is specified
in Rule 16b-3;
(b) Death: If such a person shall cease to be a
Director by reason of death while holding an Option (whether
or not then exercisable) that has not expired, his or her
executors, administrators, heirs, legatees or distributees, as
the case may be, may, at any time within three years following
such termination (but in no event after the Option has expired
under the provisions of Section 5.4), exercise the Option with
respect to any shares as to which such person has not
exercised the Option on the date the person died; provided,
however, that no shares of Common Stock issuable on exercise
of the Option may be sold, assigned, pledged or otherwise
transferred for the period of time after the date of the grant
of the Option as is specified in Rule 16b-3;
(c) Other. If such a person shall cease to be a
Director for reasons other than Retirement, Disability or
death, while holding an Option then exercisable that has not
expired, such person may, at any time within three months
after the date he or she ceases to be a Director (but in no
event after the Option has expired under the provisions of
Section 5.4 above), exercise the Option with respect to any
Shares as to which such person could have but has not
exercised the Option on the date the person ceased to be a
Director; and
(d) Death of a Former Director. If any person should
die within three years following the date he or she ceased to
be a Director by reason of Retirement or Disability or within
three months following the date he or she ceased to be a
Director for reasons other than Retirement, Disability or
death, the decedent's estate or any person who acquires the
right to exercise the Option by reason of the decedent's death
may exercise the Option (to the extent that the decedent was
entitled to do so on the date the decedent ceased to be a
Director) at any time (but in no event after the Option has
expired under the provisions of Section 5.4) within the period
ending on the later of (i) the last day of the period within
which the decedent could have exercised the Option but for his
or her death and (ii) the first anniversary of such person's
death.
5.6 Exercise Notice. A Director may exercise all or part of an
Option that is exercisable under Section 5.5 by delivering a written notice
substantially in the form attached hereto to the Treasurer of the Company
specifying the number of Shares to be purchased and providing payment in full of
the exercise price in United States dollars by certified check or bank draft.
5.7 Personal Representatives. In the event any Option is
exercised by the executors, administrators, heirs, legatees or distributees of
the estate of a deceased Director or by the guardian or legal representative of
a disabled former Director, the Company shall be under no obligation to issue
Shares thereunder unless and until the Company is satisfied that the person or
persons exercising the Option are the duly appointed legal representatives of
the deceased Director's estate or the proper legatees or distributees thereof or
the duly appointed guardian or legal representative of the disabled former
Director.
SECTION 6. ADJUSTMENT IN THE EVENT OF CHANGE IN STOCK
In the event the outstanding Shares are increased or changed
into or exchanged for a different number or kind of shares of capital stock or
other securities of the Company by reason of any stock dividend or split,
recapitalization, reclassification, merger, consolidation, combination of Shares
or other corporate change, the Board shall make such substitution or adjustment,
if any, as it deems to be equitable,
in the number or kind of Shares or other securities as to which Options may be
granted and in the number of Shares or the exercise price under unexercised
Options granted prior to such change.
In the case of any such substitution or adjustment, the
aggregate Option price in each Stock Option Agreement of all the Shares covered
thereby prior to such substitution or adjustment shall be the Option price for
all the shares or other securities substituted for such Shares or to which such
Shares are adjusted, and the Option price per share after such substitution or
adjustment shall be determined accordingly; provided, however, that no such
determination shall obligate the Company to issue or sell fractional shares or
other securities.
SECTION 7. ACCELERATION
7.1 Change of Control; Delisting. Notwithstanding any other
provisions of the Plan, upon the earlier of (a) a "Change of Control" of the
Company (as defined below), or (b) the Shares of the Company ceasing to be
publicly traded, any unexercisable portion of an Option shall become
exercisable.
7.2 Change of Control Defined. For the purposes hereof, a
"Change of Control" of the Company shall be deemed to have occurred if:
(a) any "person" (as such term is used in Section
13(d) and 14(d) of the Exchange Act other than the Company
becomes the "beneficial owner" (as determined for purposes of
Regulation 13-D under the Exchange Act as currently in
effect), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the
Company's then outstanding securities; or
(b) the stockholders of the Company approve (i) any
merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would
result in the holders of the voting securities of the Company
outstanding immediately prior thereto holding immediately
thereafter securities representing more than 80% of the
combined voting power of the voting securities of the Company
or such surviving entity outstanding immediately after such
merger or consolidation, or (ii) any sale or other disposition
(in one transaction or a series of related transactions) of
all, or substantially all, of the assets of the Company; or
(c) the stockholders of the Company approve a plan or
proposal for the liquidation or dissolution of the Company; or
(d) during any period of two consecutive years (not
including any period prior to June 8, 1995), individuals who
at the beginning of such period constitute the entire Board of
Directors of the Company and any new director, whose election
to the Board or nomination for election to the Board by the
Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose
election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the
Board.
SECTION 8. MISCELLANEOUS PROVISIONS
8.1 No Right to Directorship. Neither the Plan nor any action
taken hereunder shall be construed as giving any Director any right to be
retained in the service of the Company.
8.2 Options Nontransferable. A Director's interest in an
Option and his or her rights under the Plan may not be assigned or transferred
in whole or in part either directly or by operation of law or otherwise (except
under a qualified domestic relations order (as defined in Section 414(p) of the
Code) or,
in the event of Director's death, by will or the laws of descent and
distribution), including, but not by way of limitation, execution, levy,
garnishment, attachment, pledge, bankruptcy or in any other manner, and no such
right or interest of any Director in the Plan shall be subject to any obligation
or liability of such Director.
8.3 Compliance with Law. No Shares shall be issued hereunder
unless counsel for the Company shall be satisfied that such issuance will be in
compliance with all applicable federal, state and other securities, insurance
and other laws and regulations.
8.4 Expenses. The expenses of the Plan shall be borne by the
Company.
8.5 Unfunded. The Plan shall be unfunded. The Company shall
not be required to establish any special or separate fund or to make any other
segregation of assets to assure the issuance of Shares upon exercise of any
Option under the Plan and issuance of Shares upon exercise of Options shall be
subordinate to the claims of the Company's general creditors.
8.6 Acceptance. By accepting any Option or other benefit under
the Plan, each Director and each person claiming under or through such person
shall be conclusively deemed to have indicated his or her acceptance and
ratification of, and consent to, any action taken under the Plan by the Company
or the Board.
8.7 Construction. It is the intent of the Company that the
Plan comply in all respects with Rule 16b-3 or any successor rule, that any
ambiguities or inconsistencies in construction of the Plan be interpreted to
give effect to such intention and that if any provision of the Plan is found not
to be in compliance with Rule 16b-3, such provision shall be deemed null and
void to the extent required to permit the Plan to comply with Rule 16b-3. The
Board may adopt rules and regulations under, and amend, the Plan in furtherance
of the intent of the foregoing.
In all other respects the Plan and Options granted thereunder
shall be governed by, and construed in accordance with the laws of the State of
Delaware without regard to the conflict of laws principles thereof.
SECTION 9. AMENDMENT OR DISCONTINUANCE
The Plan may be amended at any time and from time to time by
the Board as the Board shall deem advisable, including, but not limited to,
amendments necessary to qualify for any exemption or to comply with applicable
law or regulations; provided, however, that except as provided in Section 6
above, the Board may not, without further approval by the holders of a majority
of the outstanding Shares of the Company entitled to vote thereon increase the
maximum number of Shares as to which Options may be granted under the Plan,
increase the number of shares subject to an Option, change the Option exercise
price described in Section 5.2 above, extend the period during which Options may
be granted or exercised under the Plan or change the class of persons eligible
to receive Options under the Plan. Subject to the provision of Section 8.7
relating to Rule 16b-3, no amendment of the Plan shall materially and adversely
affect any right of any Director with respect to any Option theretofore granted
without such Director's written consent. Notwithstanding the foregoing, this
Plan may not be amended more frequently than once every six months (other than
to comply with changes in the Code or the Employee Retirement Income Security
Act of 1974, as amended) or such other period as may be permitted by Rule
16b-3(c)(2)(ii)(B).
SECTION 10. ADMINISTRATION
The Plan shall be administered by the Board. The Board shall
have all the powers vested in it by the terms of the Plan, such powers to
include authority (within the limitations described herein) to prescribe the
form of the agreement embodying Options granted under the Plan. The Board shall,
subject to the provisions of the Plan, have the power to construe the Plan, to
determine all questions arising thereunder
and to adopt and amend such rules and regulations for the administration of the
Plan as it may deem desirable. Any decision of the Board in the administration
of the Plan, as described herein, shall be final and conclusive. The Board may
act only by a majority of its members in office, except that the members thereof
may authorize any one or more of their number or the Secretary or any other
officer of the Company to execute and deliver documents on behalf of the Board.
No member of the Board shall be liable for anything done or omitted to be done
by such member or by any other member of the Board in connection with the Plan,
except in circumstances involving actual bad faith.
SECTION 11. TERMINATION
This Plan shall terminate upon the earlier of the following
dates or events to occur:
(a) upon the adoption of a resolution of the Board
terminating the Plan; or
(b) immediately following the automatic grant of
Options at the Annual Meeting in 2005.
SECTION 12. EFFECTIVE DATE OF PLAN
The Plan shall become effective as of April 20, 1995, provided
that the adoption of the Plan shall have been approved by the affirmative vote
of the holders of a majority of the outstanding Shares of the Company present in
person or represented by proxy at the 1995 Annual Meeting of Stockholders.