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Exhibit 10(f)
THE PITTSTON COMPANY
1988 Stock Option Plan
(as amended 9-17-93)
ARTICLE I
Purpose of the Plan
This 1988 Stock Option Plan (this "Plan") contains provisions designed to
enable key employees of The Pittston Company (the "Company") and its
Subsidiaries to acquire a proprietary interest in the Company in the form of
shares of either or both classes of its Common Stock, viz., Pittston Services
Group Common Stock and Pittston Minerals Group Common Stock. The Company
intends this Plan to encourage those individuals who are expected to contribute
significantly to the Company's success to accept employment or continue in the
employ of the Company and its Subsidiaries, to enhance their incentive to
perform at the highest level, and, in general, to further the best interests of
the Company and its shareholders.
ARTICLE II
Administration of the Plan
Section 1. Subject to the authority as described herein of the Board
of Directors of the Company (the "Board"), this Plan shall be administered by a
committee (the "Committee") designated by the Board, which shall be composed of
at least three members of the Board, all of whom are Disinterested Persons.
Until otherwise determined by the Board, the Compensation and Benefits
Committee designated by the Board shall be the Committee under this Plan. The
Committee is authorized to interpret this Plan as it deems best. All
determinations by the Committee shall be made by the affirmative vote of a
majority of its members, but any determination reduced to writing and signed
by a majority of its members shall be fully as effective as if it had been made
by a majority vote at a meeting duly called and held. Subject to any
applicable provisions of the Company's bylaws or of this Plan, all deter-
minations by the Committee or by the Board pursuant to the provisions of this
Plan, and all related orders or resolutions of the Committee or the Board,
shall be final, conclusive and binding on all persons, including the Company
and its shareholders and those receiving options under this Plan.
Section 2. All authority of the Committee provided for in or pursuant
to this Plan, including that referred to in Section 1 of this Article II, may
also be exercised by the Board. No action of the Board taken pursuant to the
provisions of this Plan shall be effective unless at the time both a majority
of the Board and a majority of the directors acting in the matter are
Disinterested Persons. In the event of any conflict or inconsistency between
determinations, orders, resolutions or other actions of the Committee and the
Board taken in connection with this Plan, the actions of the Board shall
control.
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ARTICLE III
Eligibility
Only persons who are Employees, including individuals who have agreed to
become Employees as provided in Article XII, shall be eligible to receive
option grants under this Plan. Neither the members of the Committee nor any
member of the Board who is not an Employee shall be eligible to receive any
such grant.
ARTICLE IV
Stock Subject to Grants under this Plan
Section 1. Grants under this Plan shall relate to either or both of
the classes of Common Stock ("Common Stock") of the Company and may be made in
the form of incentive stock options or nonqualified stock options. Unless
otherwise indicated, references in this Plan to Common Stock shall be construed
to refer to the class of Common Stock covered by the particular option.
Section 2. Subject to Section 3 of this Article IV, the maximum number
of shares of Common Stock which may be issued pursuant to options exercised
under this Plan shall be (a) in the case of Pittston Services Group Common
Stock, 925,000 shares plus the number of shares of such Stock issuable pursuant
to options outstanding under this Plan on July 27, 1993, and (b) in the case of
Pittston Minerals Group Common Stock, 250,000 shares plus the number of shares
of such Stock issuable pursuant to options outstanding under this Plan on July
27, 1993. Such number of shares of Common Stock referred to in clause (a) or
(b) shall be reduced by the aggregate number of shares of such Common Stock
covered by options purchased pursuant to Section 3 or Section 4 of Article VI.
Section 3. In the event of any dividend payable in any class of Common
Stock or any split or combination of any class of Common Stock, (a) the number
of shares of such class which may be issued under this Plan shall be
proportionately increased or decreased, as the case may be, (b) the number of
shares of such class (including shares subject to options not then exercisable)
deliverable pursuant to grants theretofore made shall be proportionately
increased or decreased, as the case may be, and (c) the aggregate purchase
price of shares of such class subject to any such grant shall not be changed.
In the event of any other recapitalization, reorganization, extraordinary
dividend or distribution or restructuring transaction (including any
distribution of shares of stock of any Subsidiary or other property to holders
of shares of any class of Common Stock) affecting any class of Common Stock,
the number of shares of such class issuable under this Plan shall be subject to
such adjustment as the Committee or the Board may deem appropriate, and the
number of shares of such class issuable pursuant to any option theretofore
granted (whether or not then exercisable) and/or the option price per share of
such option, shall be subject to such adjustment as the Committee or the Board
may deem appropriate with a view toward preserving the value of such option.
In the event of a merger or share exchange in which the Company will not
survive as an
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independent, publicly owned corporation, or in the event of a consolidation or
of a sale of all or substantially all of the Company's assets, provision shall
be made for the protection and continuation of any outstanding options by the
substitution, on an equitable basis, of such shares of stock, other securities,
cash, or any combination thereof, as shall be appropriate.
ARTICLE V
Purchase Price of Optioned Shares
Unless the Committee shall fix a greater purchase price, the purchase
price per share of Common Stock under any option shall be 100% of the Fair
Market Value of a share of Common Stock covered by such option at the time such
option is granted.
ARTICLE VI
Grant of Options
Section 1. Each option granted under this Plan shall constitute either
an incentive stock option, intended to qualify under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), or a nonqualified stock
option, not intended to qualify under said Section 422, as determined in each
case by the Committee.
Section 2. The Committee shall from time to time determine the
Employees to be granted options, it being understood that options may be
granted at different times to the same Employees. In addition, the Committee
shall determine (a) the number and class of shares of Common Stock subject to
each option, (b) the time or times when the options will be granted, (c) the
purchase price of the shares subject to each option, which price shall be not
less than that specified in Article V, and (d) the time or times when each
option may be exercised within the limits stated in this Plan, which except as
provided in the following sentence shall in no event be less than six months
after the date of grant. All options granted under this Plan shall become
exercisable in their entirety at the time of any Change in Control of the
Company. Anything in this Plan to the contrary notwithstanding, during the
period commencing September 17, 1993 and ending May 11, 1998, an individual
Employee shall not be granted one or more options for more than an aggregate of
(i) 300,000 shares of Pittston Services Group Common Stock and (ii) 100,000
shares of Pittston Minerals Group Common Stock, but the maximum number of
shares of each such class of Common Stock remaining available for any future
option grant or grants to such Employee shall be proportionately increased or
decreased, as the case may be, in the event of any dividend payable in shares
of such class or any split or combination of shares of such class.
Section 3. In connection with any option granted under this Plan the
Committtee in its discretion may grant a stock appreciation right (a "Stock
Appreciation Right"), providing that at the election of the holder of a Stock
Appreciation Right (which election shall, unless the Committee otherwise
consents, be made only during an Election Period), the Company shall purchase
all or
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any part of the related option to the extent that such option is exercisable at
the date of such election for an amount (payable in the form of cash, shares of
Common Stock or any combination thereof, all as the Committee shall in its
discretion determine) equal to the excess of the Fair Market Value of the
shares of Common Stock covered by such option or part thereof so purchased on
the date such election shall be made over the purchase price of such shares so
covered. A Stock Appreciation Right may also provide that the Committee or the
Board reserves the right to determine, in its discretion, the date (which shall
be subsequent to six months after the date of grant of such option) on which
such Right shall first become exercisable in whole or in part.
Section 4. In connection with any option granted under this Plan the
Committee in its discretion may grant a limited right (a "Limited Right")
providing that the Company shall, at the election of the holder of a Limited
Right (which election may be made only during the period beginning on the first
day following the date of expiration of any Offer and ending on the forty-fifth
day following such date), purchase all or any part of such option, for an
amount (payable entirely in cash) equal to the excess of the Offer Price of the
shares of Common Stock covered by such purchase on the date such election shall
be made over the purchase price of such shares so purchased. Notwithstanding
any other provision of this Plan, no Limited Right may be exercised within six
months of the date of its grant.
Section 5. The authority with respect to the grant of options and the
determination of their provisions contained in Sections 1 through 4 of this
Article VI may be delegated by the Board to one or more officers of the
Company, on such conditions and limitations as the Board shall approve;
provided, however, that no such authority shall be delegated with respect to
the grant of options to any officer or director of the Company or with respect
to the determination of any of the provisions of any of such options.
ARTICLE VII
Non-Transferability of Options
No option or Stock Appreciation Right (including any Limited Rights)
granted under this Plan shall be transferable by the optionee otherwise than by
will or by the laws of descent and distribution, and any such option or Stock
Appreciation Right (including any Limited Rights) shall be exercised during the
lifetime of the optionee only by the optionee or the optionee's duly appointed
legal representative.
ARTICLE VIII
Exercise of Options
Section 1. Each incentive stock option granted under this Plan shall
terminate not later than ten years from the date of grant. Each nonqualified
stock option granted under this Plan shall terminate not later than ten years
and two days from the date of grant.
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Section 2. Except in cases provided for in Article IX, each option
granted under this Plan may be exercised only while the optionee is an
Employee. An Employee's right to exercise any incentive stock option shall be
subject to the provisions of Section 422 of the Code restricting the
exercisability of such option during any calendar year.
Section 3. A person electing to exercise an option shall give written
notice to the Company of such election and of the number of shares of Common
Stock such person has elected to purchase, and shall tender the full purchase
price of such shares, which tender shall be made in cash or cash equivalent
(which may be such person's personal check) at the time of purchase or in
accordance with cash payment arrangements acceptable to the Company for payment
prior to delivery of such shares or, if the Committee so determines either
generally or with respect to a specified option or group of options, in shares
of Common Stock already owned by such person (which shares shall be valued for
such purpose on the basis of their Fair Market Value on the date of exercise),
or in any combination thereof. The Company shall have no obligation to deliver
shares of Common Stock pursuant to the exercise of any option, in whole or in
part, until the Company receives payment in full of the purchase price thereof.
No optionee or legal representative, legatee or distributee of such optionee
shall be or be deemed to be a holder of any shares of Common Stock subject to
such option or entitled to any rights as a shareholder of the Company in
respect of any shares of Common Stock covered by such option until such shares
have been paid for in full and issued by the Company. A person electing to
exercise a Stock Appreciation Right or Limited Right then exercisable shall
give written notice to the Company of such election and of the option or part
thereof which is to be purchased by the Company.
ARTICLE IX
Termination of Options
Section 1. If an optionee shall cease to be an Employee for any reason
other than death or retirement under the Company's Pension-Retirement Plan or
any other pension plan sponsored by the Company or a Subsidiary, all of the
optionee's options shall be terminated except that any option, Stock
Appreciation Right or Limited Right to the extent then exercisable may be
exercised within three months after cessation of employment, but not later than
the termination date of the option or in the case of a Limited Right not later
than the expiration date of such Right.
Section 2. If and when an optionee shall cease to be an Employee by
reason of the optionee's early, normal or late retirement under the Company's
Pension-Retirement Plan or any such other pension plan, all of the optionee's
options shall be terminated except that (a) any Stock Appreciation Right or
Limited Right to the extent then exercisable may be exercised within three
months after such retirement, but not later than the termination date of the
option or in the case of a Limited Right not later than the expiration date of
such Right, and (b) any option to the extent then exercisable may, unless it
otherwise provides, be exercised within three years after such retirement, but
not later than the
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termination date of the option, unless within 45 days after such retirement the
Committee determines, in its discretion, that such option may be exercised only
within a period of shorter duration (not less than three months following
notice of such determination to the optionee) to be specified by the Committee.
Section 3. If an optionee shall die while an Employee, all of the
optionee's options shall be terminated except that any option (but not any
Stock Appreciation Right or Limited Right) to the extent then exercisable by
the optionee at the time of death, together with the unmatured installment, if
any, of the option which at that time is next scheduled to become exercisable,
may be exercised within one year after the date of such death, but not later
than the termination date of the option, by the optionee's estate or by the
person designated in the optionee's last will and testament.
Section 4. If an optionee shall die after ceasing to be an Employee,
all of the optionee's options shall be terminated except that any option (but
not any Stock Appreciation Right or Limited Right) to the extent exercisable by
the optionee at the time of death may be exercised within one year after the
date of death, but not later than the termination date of the option, by the
optionee's estate or by the person designated in the optionee's last will and
testament.
ARTICLE X
Miscellaneous Provisions
Section 1. Each option grant under this Plan shall be subject to the
requirement that if at any time the Committee shall determine that the listing,
registration or qualification of the shares of Common Stock subject to such
grant upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the making of such grant or
the issue of Common Stock pursuant thereto, then, anything in this Plan to the
contrary notwithstanding, no option may be exercised in whole or in part, and
no shares of Common Stock shall be issued, unless such listing, registration,
qualification, consent or approval shall have been effected or obtained free
from any conditions not reasonably acceptable to the Committee.
Section 2. The Company may establish appropriate procedures to ensure
payment or withholding of such income or other taxes as may be provided by law
to be paid or withheld in connection with the issue of shares of Common Stock
under this Plan or the making of any payments pursuant to Section 3 or 4 of
Article VI, and to ensure that the Company receives prompt advice concerning
the occurrence of an Income Recognition Date or any other event which may
create, or affect the timing or amount of, any obligation to pay or withhold
any such taxes or which may make available to the Company any tax deduction
resulting from the occurrence of such event. Such procedures may include
arrangements for payment or withholding of taxes by retaining shares of Common
Stock otherwise issuable to the optionee in accordance with the provisions of
this Plan or by accepting already owned shares, and by applying the Fair Market
Value of such shares to the withholding
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taxes payable or to the amount of tax liability in excess of withholding taxes
which arises from the delivery of such shares.
Section 3. Any question as to whether and when there has been a
retirement under the Company's Pension-Retirement Plan or any other pension
plan sponsored by the Company or a Subsidiary or a cessation of employment for
any other reason shall be determined by the Committee, and any such reasonable
determination shall be final.
Section 4. All instruments evidencing options granted shall be in such
form, consistent with this Plan and any applicable determinations or other
actions of the Committee and the Board, as the officers of the Company shall
determine.
Section 5. The grant of an option to an Employee shall not be
construed to give such Employee any right to be retained in the employ of the
Company or any of its Subsidiaries.
ARTICLE XI
Plan Termination and Amendments
Section 1. The Board may terminate this Plan at any time, but this
Plan shall in any event terminate on May 11, 1998, and no options may
thereafter be granted, unless the shareholders shall have approved its
extension. Options granted in accordance with this Plan prior to the date of
its termination may extend beyond that date.
Section 2. The Board or the Committee may from time to time amend,
modify or suspend this Plan, but no such amendment or modification without the
approval of the shareholders shall
(a) increase the maximum number (determined as provided in
this Plan) of shares of any class of Common Stock which may be issued
pursuant to options granted under this Plan;
(b) permit the grant of any option at a purchase price
less than 100% of the Fair Market Value of the Common Stock covered by
such option at the time such option is granted;
(c) permit the exercise of an option unless arrangements
are made to ensure that the full purchase price of the shares as to
which the option is exercised is paid prior to delivery of such
shares; or
(d) extend beyond May 11, 1998, the period during which
option grants may be made.
ARTICLE XII
Definitions
Wherever used in this Plan, the following terms shall have the meanings
indicated:
Change in Control: A Change in Control shall be deemed to
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have occurred if either (a) any person, or any two or more persons acting as a
group, and all affiliates of such person or persons, shall own beneficially
more than 20% of the total voting power in the election of directors of the
Company of all classes of Common Stock outstanding (exclusive of shares held by
the Company's Subsidiaries) pursuant to a tender offer, exchange offer or
series of purchases or other acquisitions, or any combination of those
transactions, or (b) there shall be a change in the composition of the Board at
any time within two years after any tender offer, exchange offer, merger,
consolidation, sale of assets or contested election, or any combination of
those transactions (a "Transaction"), so that (i) the persons who were
directors of the Company immediately before the first such Transaction cease to
constitute a majority of the Board of Directors of the corporation which shall
thereafter be in control of the companies that were parties to or otherwise
involved in such first Transaction, or (ii) the number of persons who shall
thereafter be directors of such corporation shall be fewer than two-thirds of
the number of directors of the Company immediately prior to such first
Transaction. A Change in Control shall be deemed to take place upon the first
to occur of the events specified in the foregoing clauses (a) and (b).
Disinterested Persons: Such term shall have the meaning ascribed thereto
in Rule 16b-3(d)(3) under the Securities Exchange Act of 1934.
Election Period: The period beginning on the third business day following
a date on which the Company releases for publication its quarterly or annual
summary statements of sales and earnings, and ending on the twelfth business
day following such date.
Employee: Any officer and any other employee of the Company or a
Subsidiary, including (a) any director who is also an employee of the Company
or a Subsidiary and (b) an employee on approved leave of absence provided such
employee's right to continue employment with the Company or a Subsidiary upon
expiration of such employee's leave of absence is guaranteed either by statute
or by contract with or by a policy of the Company or a Subsidiary. For
purposes of eligibility for the grant of a nonqualified stock option, such term
shall include any individual who has agreed in writing to become an officer or
other employee of the Company or a Subsidiary within 30 days following the date
on which an option is granted to such individual.
Fair Market Value: With respect to shares of any class of Common Stock,
the average of the high and low quoted sale prices of a share of such Stock on
the date in question (or, if there is no reported sale on such date, on the
last preceding date on which any reported sale occurred) on the New York Stock
Exchange Composite Transactions Tape.
Income Recognition Date: With respect to the exercise of any option, the
later of (a) the date of such exercise or (b) the date on which the rights of
the holder of such option in the shares of Common Stock covered by such
exercise become transferable and not subject to a substantial risk of
forfeiture (within the meaning of Section 83 of the Code); provided, however,
that, if such holder shall make an election pursuant to Section 83(b) of the
Code with respect to such exercise, the Income Recognition Date with respect
thereto shall be the date of such exercise.
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Offer: Any tender offer, exchange offer or series of purchases or other
acquisitions, or any combination of those transactions, as a result of which
any person, or any two or more persons acting as a group, and all affiliates of
such person or persons, shall own beneficially more than 30% of the total
voting power in the election of directors of the Company of all classes of
Common Stock outstanding (exclusive of shares held by the Company's
Subsidiaries).
Offer Price: The highest price per share of Common Stock paid in any
Offer which is in effect at any time beginning on the ninetieth day prior to
the date on which a Limited Right is exercised. Any securities or property
which are part or all of the consideration paid for shares of Common Stock in
the Offer shall be valued in determining the Offer Price at the higher of (a)
the valuation placed on such securities or property by the person or persons
making such Offer or (b) the valuation of such securities or property as may be
determined by the Committee.
Subsidiary: Any corporation of which stock representing at least 50% of
the ordinary voting power is owned, directly or indirectly, by the Company.