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EXHIBIT 10
CBI INDUSTRIES, INC.
1995 STOCK OPTION PLAN
1. Purpose of Plan
The purpose of the CBI Industries, Inc., 1995 Stock Option Plan (the
"Plan") is to aid CBI Industries, Inc. and its Subsidiaries (collectively the
"Company") in securing and retaining Key Employees of outstanding ability by
making it possible to offer them an increased incentive in the form of a
proprietary interest in the Company, to join or continue in the service of the
Company and to increase their efforts for its welfare.
2. Definitions
As used in this Plan, the following words shall have the following
meanings:
(a) "CBI" means CBI Industries, Inc.;
(b) "Board of Directors" means the Board of Directors of CBI;
(c) "Common Stock" means common stock of CBI;
(d) "Holder" means either a Participant or a person other than a
Participant to whom an Option or a Right has been transferred in
accordance with Section 8(d) herein;
(e) "Incentive Stock Option" means an option to purchase shares of
Common Stock which is intended to qualify as an "incentive stock
option" as defined in Section 422A of the Internal Revenue Code;
(f) "Key Employee" means any person, including officers, in the
regular full-time employment of the Company who, in the opinion
of the Committee referred to in Section 3, is or is expected to
be primarily responsible for the management, growth or
protection of some part or all of the business of the Company;
(g) "Limited Right" means a right to receive cash in lieu of the
exercise of an Option, if granted pursuant to Section 5(e);
(h) "Officers Exercise Period" means any period beginning on the
third business day following the date of public release of a
summary statement of CBI's quarterly or annual sales and
earnings and ending on the twelfth business day following such
date;
(i) "Non-Qualified Stock Option" means an option to purchase shares
of Common Stock which is intended not to qualify as an incentive
stock option as defined in Section 422A of the Internal Revenue
Code;
(j) "Option" means an Incentive Stock Option or a Non-Qualified
Stock Option;
(k) "Participant" means a person to whom an Option is granted that
has not terminated and ceased to be exercisable under the Plan;
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(l) "Right" means a stock appreciation right to elect to receive
shares of Common Stock with a fair market value, at the time of
any exercise of such stock appreciation right, equal to the
amount by which the fair market value of all shares subject to
the Option (or part thereof) in respect of which such stock
appreciation right was granted exceeds the exercise price of
said Option (or part thereof), or to receive from CBI, in lieu
of such shares, the fair market value thereof in cash, as
provided in Section 7; and
(m) "Subsidiary" means any corporation other than CBI in an unbroken
chain of corporations beginning with CBI if each of the
corporations other than the last corporation in the unbroken
chain owns 50% or more of the voting stock in one of the other
corporations in such chain.
3. Administration of Plan
The Plan shall be administered by the Compensation Committee of the
Board of Directors (the "Committee"). None of the members of the Committee shall
be eligible to be selected for the grant of an Option, Right, Limited Right, or
any other option, stock appreciation right or shares under the Plan or the grant
of any stock or option under any other plan maintained by the Company during
such membership or have been so eligible for selection within one year prior
thereto or thereafter. The Committee may adopt its own rules of procedure, and
the action of a majority of the Committee, taken at a meeting or taken without a
meeting by a writing signed by such majority, shall constitute action by the
Committee. The Committee shall have the power and authority to administer,
construe and interpret the Plan, to make rules for carrying it out and to make
changes in such rules.
4. Granting of Options
The Committee may from time to time grant Options under the Plan to such
Key Employees and for such numbers of shares as the Committee may determine. The
Committee may grant Options in such amounts and may impose such conditions on
the grant of an Option as it deems advisable.
5. Terms of Options
The terms of each Option granted under the Plan shall be as determined
from time to time by the Committee and shall be set forth in an Incentive Stock
Option Agreement or a Non-Qualified Stock Option Agreement, as shall be
appropriate, in a form approved by the Committee, consistent, however, with the
following:
(a) The Option price per share shall not be less than fair market
value at the time the Option is granted.
(b) The Option shall be exercisable in whole or in part from time to
time during the period beginning at the completion of the
required holding period stated in the Option, if any, and ending
at the expiration of ten years from the date of grant of the
Option, unless an earlier expiration date shall be stated in the
Option or the Option shall cease to be exercisable pursuant to
paragraph (d) of this Section 5.
(c) Payment in full of the Option price shall be made upon exercise
of each Option and may be made in cash, by the delivery of
shares of Common Stock with a fair market value equal to the
Option price, or by a combination of cash and such shares whose
fair market value together with such cash shall equal the Option
price.
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(d) If a Participant's employment with the Company terminates other
than by reason of the Participant's death, retirement for
disability or retirement under a retirement plan of the Company,
the Participant's Option shall terminate and cease to be
exercisable. If a Participant's employment with the Company
terminates by reason of death or retirement due to disability,
an Incentive Stock Option shall terminate and cease to be
exercisable at the earlier of ten years from the date of grant
or one year from the date of death or such retirement; if by
reason of retirement under a plan, then at the earlier of ten
years from the date of grant or three months from the date of
such retirement. The Committee may, upon written request of a
Holder, convert an Incentive Stock Option into a Non-Qualified
Stock Option, and if such request is granted, the provisions
concerning termination of Non-Qualified Stock Options shall
apply to the Option in question which has been converted. A
Non-Qualified Stock Option shall terminate at the earlier of ten
years from the date of grant or one year from the date of
termination of employment if such termination is due to death.
Following any retirement of a Participant, a Non-Qualified Stock
Option shall terminate on the expiration date of the Option. If
the terms of an Option provide for its expiration prior to ten
years from the date of grant, the Committee may at any time
extend the expiration date of the Option but not beyond ten
years from its date of grant In the event any date specified
herein falls on a day that is not a business day, then such date
shall be deemed to be the next following business day.
(e) An Option may contain a Limited Right to receive cash in lieu of
shares under conditions to be set forth in the Option, in the
discretion of and as determined by the Committee, in addition to
Rights.
6. Granting of Rights
The Committee, at the time of grant of an Option or at any time prior to
the expiration of the term of an Option may also grant, subject to the terms and
conditions of the Plan, Rights in respect of all or part of such Option to a
Holder, provided that, if granted to a Participant, the Participant at such time
is a Key Employee.
7. Exercise of Options and Rights
(a) A Holder who decides to exercise an Option or Right in whole or
in part shall give notice in writing to the Secretary of CBI of
such exercise on a form approved by the Committee. A notice
exercising a Right shall also specify the extent, if any, to
which the Holder elects to receive shares of Common Stock and
the extent, if any, to which the Holder elects to receive cash,
but shall in any event be subject to the determination by the
Committee as provided in paragraph (d) of this Section 7. Any
exercise shall be effective as of the date specified in the
notice of exercise, but not earlier than the date the notice of
exercise is actually received by the Secretary of CBI, and in
the case of exercise of an Option, when payment in full of the
Option price is actually received by the Secretary of CBI.
(b) To the extent an Option is exercised in whole or in part, any
Right granted in respect of such Option (or part thereof) shall
terminate and cease to be exercisable. To the extent a Right is
exercised in whole or in part, the Option (or part thereof) in
respect of which such Right was granted shall terminate and
cease to be exercisable.
(c) Subject to Section 6, a Right shall be exercisable only during
the period in which the Option (or part thereof) in respect of
which such Right was granted is exercisable and, in addition, if
the Holder of such Right is an officer of CBI and elects to
receive cash for all or part of the payments upon exercise, or
who exercises for such cash, such Holder may so elect or
exercise
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such Right only during an Officer's Exercise Period. For this
purpose only, the fair market value of shares of CBI stock shall
be deemed to be the average of the closing prices for public
trading on the largest national securities exchange on which
such shares trade for all of the business days within such
Officer's Exercise Period.
(d) The Committee shall have sole discretion to determine the form
in which payment will be made following exercise of a Right. All
or any part of the obligation arising out of an exercise of a
Right may be settled:
(i) by payment in shares of Common Stock with a fair market
value equal to the cash that would otherwise be paid,
(ii) by payment in cash, or
(iii) by payment in a combination of such shares and cash.
(e) To the extent that any Right shall not have been exercised or
cancelled or become non-exercisable, it shall be deemed to have
been exercised automatically, without any notice of exercise, on
the last day on which the Right's related Option is exercisable,
or, in the case of officers of CBI, on the last day of the
Officer's Exercise Period before the last day on which the
Right's related Option is exercisable, provided that any other
conditions or limitations on the Right's exercise other than
notice of exercise are satisfied and the Right shall then have
value. Such exercise shall be deemed to specify that, subject to
determination by the Committee as provided in paragraph (d) of
this Section 7, the Holder elects to receive cash and that such
exercise of a Right shall be effective as of the time of the
exercise.
(f) The aggregate fair market value of the shares for which any Key
Employee may exercise Incentive Stock Options in any calendar
year under all plans of CBI shall not exceed the sum of $100,000
plus the amount which may be carried forward to that year. For
purposes of the preceding sentence, the aggregate fair market
value shall be determined as of the time an Incentive Stock
Option is granted, and the amount which may be carried forward
from each previous calendar year is $100,000 minus the amount of
Incentive Options first exercisable and actually exercised in
that previous calendar year. This provision shall be applied by
taking options into account in the order in which they were
granted.
(g) To the extent the receipt of shares of Common Stock pursuant to
the exercise of any Option or Right is subject to the
withholding of any income or employment taxes by CBI for which
CBI requires reimbursement from the recipient, the recipient may
elect to reimburse CBI with shares of Common Stock withheld from
the shares to be received, or cash, or a combination of such
shares and cash, of sufficient value to make such reimbursement.
Any such withholding or reimbursement shall comply with all
applicable governing laws and regulations.
8. Limitations and Conditions
(a) The total number of shares of Common Stock that may be optioned
or issued or transferred upon exercise of Rights under the Plan
is 1,700,000 shares. Such total number of shares may consist, in
whole or in part, of unissued shares or reacquired shares. The
foregoing number of shares may be increased or decreased by the
events set forth in of Section 10.
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(b) Any shares that have been optioned that cease to be subject to
an Option (other than by reason of exercise of the Option) shall
again be available for option and shall not be considered as
having been theretofore optioned. Any shares subject to an
Option (or part thereof) that is cancelled upon exercise of a
Right shall be treated as if the Option itself were exercised
and such shares shall no longer be available for grant.
(c) No Option or Right shall be granted under the Plan after January
1, 2005 but Options and Rights theretofore granted may extend
beyond that date. At the time an Option or Right is granted or
amended or the terms or conditions of an Option or Right are
changed, the Committee may provide for limitations or conditions
on the exercisability of the Option or Right.
(d) (i) A Non-Qualified Stock Option shall be
non-transferrable unless the Committee designates
otherwise. An Incentive Stock Option or a Right
associated therewith shall not be transferable by the
Participant otherwise than by will or by the laws of
descent and distribution or by the provisions for the
designation of a beneficiary in accordance with (ii)
below. A Right shall never be transferred except to the
transferee of the related Option. During the lifetime
of the Participant, an Incentive Stock Option or a
Right associated therewith shall only be exercisable by
the Participant.
(ii) Upon the death of a Participant, any outstanding and
unexercised Options or Rights held by such Participant
on the date of death shall be transferred to such
beneficiary or beneficiaries as have been effectively
designated by the Participant or, if none, then to the
deceased Participant's surviving spouse or, if none,
then to the Participant's lawful descendants, per
stirpes as defined by common law, or, if none, then to
the deceased Participant's estate. Any such transfer
shall be effective as of the date of death of the
Participant. To be effective, the designation of such
beneficiary must be filed with the Committee or its
designate in such written form as it requires and may
include secondary, successive or contingent
beneficiaries. Any Participant may change a beneficiary
designation at any time by filing with the Committee a
new beneficiary designation meeting the above
requirements. The determination of the Committee as to
the identity of a beneficiary, or whether a beneficiary
is living or dead, pursuant to any determinations of
rights under this Plan shall be conclusive and binding
on all concerned.
(e) No person shall have any rights of a stockholder (i) as to
shares under option until, after proper exercise of the Option,
such shares shall have been recorded on CBI's official
stockholder records as having been issued or transferred or (ii)
as to shares to be delivered following exercise of a Right
until, after proper exercise of the Right and determination by
the Committee to make payment therefor in shares, such shares
shall have been recorded on CBI's official stockholder records
as having been issued or transferred.
(f) CBI shall not be obligated to deliver any shares until they have
been listed (or authorized for listing upon official notice of
issuance) upon each stock exchange upon which outstanding shares
of such class at the time are listed nor until there has been
compliance with such laws or regulations as CBI may deem
applicable. CBI shall use its best efforts to effect such
listing and compliance. No fractional shares shall be delivered.
(g) The total number of shares of Common Stock that may be optioned
to a Participant in any year shall not exceed 100,000 shares.
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9. Transfers and Leaves of Absence
For the purposes of the Plan: (a) a transfer of a Participant's
employment without an intervening period from CBI to a Subsidiary or vice versa,
or from one Subsidiary to another, shall not be deemed a termination of
employment, and (b) a Participant who is granted in writing a leave of absence
shall be deemed to have remained in the employ of the Company during such leave
of absence.
10. Stock Adjustments
In the event of any merger, consolidation, stock dividend, split-up,
combination or exchange of shares or recapitalization or change in
capitalization, the total number of shares set forth in paragraph (a) of Section
8 shall be proportionately and appropriately adjusted. In any such case, the
number and kind of shares that are subject to any Option (including any Option
outstanding after termination of employment), the Option price per share and the
number of Rights granted in connection therewith, if any, shall be
proportionately and appropriately adjusted by the Committee without any change
in the aggregate Option price to be paid therefor upon exercise of the Option.
11. Amendment and Termination
(a) The Board of Directors shall have the power to amend the Plan,
including the power to change the amount of the aggregate fair
market value of the shares for which any Key Employee may
exercise Incentive Stock Options under Section 4 to the extent
provided in Section 422A, or any successor provision, of the
Internal Revenue Code. It shall not, however, except as
otherwise provided in the Plan, increase the maximum number of
shares authorized for the Plan, nor reduce the basis upon which
the minimum Option price is determined, nor extend the period
within which Options or Rights under the Plan may be granted,
nor change the basis upon which shares or cash may be
distributed upon exercise of a Right, nor provide for an Option
or Right that is exercisable more than ten years from the date
of grant. It shall have no power (without the consent of the
person or persons at the time entitled to exercise the Option)
to change the terms and conditions of any Option in a manner
that would adversely affect the rights of such person or persons
except to the extent, if any, provided in the Option.
(b) The Board of Directors may suspend or terminate the Plan at any
time. No such suspension or termination shall affect Options or
Rights then in effect.
12. Effective Date
The Plan shall be effective as of January 1, 1995, subject to its
approval by the stockholders of CBI and subject to any modification that may be
made herein prior to such stockholder approval that may be deemed required or
appropriate by the Board of Directors to meet legal requirements. All Options,
together with related Rights or Limited Rights, if any, which have been or may
be granted under the Plan prior to stockholder approval, shall be conditioned
upon, and may not be exercised until after, such stockholder approval.
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