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EXHIBIT 18
FORM OF FIRST AMENDMENT TO
THE EXIDE ELECTRONICS GROUP, INC.
1995 EMPLOYEE STOCK OPTION AND RESTRICTED STOCK PLAN
AND OPTIONS THEREUNDER
The Exide Electronics Group, Inc. 1995 Employee Stock Option and Restricted
Stock Plan (the "Plan"), and all Options and Restricted Stock currently
outstanding under the Plan ("Outstanding Awards"), are hereby amended, effective
as of July 16, 1997, as set forth below, pursuant to the authority of the
Committee set forth in Section 17 of the Plan to amend the Plan. (All
capitalized terms used in this First Amendment and not defined herein shall have
the meanings ascribed to them in the Plan.)
1. The following new definition is added to Section 2 of the Plan:
"Change of Control" means:
(a) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of voting securities of the Corporation where such
acquisition causes such Person to own 30% or more of the combined voting
power of the then outstanding voting securities of the Corporation
entitled to vote generally in the election of directors (the
"Outstanding Corporation Voting Securities"); provided, however, that
for purposes of this subsection (a), the following acquisitions shall
not be deemed to result in a Change of Control: (i) any acquisition
directly from the Corporation, (ii) any acquisition by the Corporation,
(iii) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any corporation controlled
by the Corporation or (iv) any acquisition pursuant to a transaction
that complies with clauses (i), (ii) and (iii) of subsection (c) below;
or
(b) individuals who, as of the date hereof, constitute the Board
of Directors (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Board of Directors; provided, however, that
any individual becoming a director subsequent to the date hereof whose
election, or nomination for election by the Corporation's shareholders,
was approved by a vote of at least a majority of the directors then
comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs
as a result of an actual or threatened election contest with respect to
the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other
than the Board of Directors; or
(c) The approval by the shareholders of the Corporation of a
reorganization, merger or consolidation or sale or other disposition of
all or substantially all of the assets of the Corporation or the
acquisition of assets of another entity ("Business Combination") or, if
consummation of such Business Combination is subject, at the time of
such approval by shareholders, to the consent of any government or
governmental agency, the obtaining of such consent (either explicitly or
implicitly by consummation); excluding, however, such a Business
Combination pursuant to which (i) all or substantially all of the
individuals and entities who were the beneficial owners of the
Outstanding Corporation Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly, more than
60% of, respectively, the then outstanding shares of common stock and
the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the case may
be, of the corporation resulting from such Business Combination
(including, without limitation, a corporation that as a result of such
transaction owns the Corporation or all or substantially all of the
Corporation's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding
Corporation Voting Securities, (ii) no Person (excluding any employee
benefit plan (or related trust) of the Corporation or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 30% or more of,
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respectively, the then outstanding shares of common stock of the
corporation resulting from such Business Combination or the combined
voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to
the Business Combination and (iii) at least a majority of the members of
the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board of
Directors, providing for such Business Combination; or
(d) approval by the shareholders of the Corporation of a complete
liquidation or dissolution of the Corporation.
2. Section 18 of the Plan is hereby amended to read in its entirety as
follows:
18.1 CHANGES IN CAPITALIZATION
In the event of any change in corporate capitalization, such as a
stock split or a corporate transaction, such as any merger, consolidation,
separation, including a spin-off, or other distribution of stock or
property of the Corporation, any reorganization (whether or not such
reorganization comes within the definition of such term in Section 368 of
the Code) or any partial or complete liquidation of the Corporation, the
Committee or Board may make such substitution or adjustments in the
aggregate number and kind of shares reserved for issuance under the Plan,
in the number, kind and option price of shares subject to outstanding
Options and Restricted Stock, and/or such other equitable substitution or
adjustments as it may determine to be appropriate in its sole discretion.
18.2 SURVIVAL OF INCENTIVE AWARDS
No event described in Section 18.1 shall cause the termination of the
Plan or of any Incentive Awards granted hereunder; provided, that such
Incentive Awards shall be subject to adjustment as provided for in Section
18.1 and, if such event constitutes a Change of Control, to the provisions
of Section 28 hereof.
3. A new Section 28 is hereby added to the Plan, reading in its entirety
as follows:
28. CHANGE OF CONTROL
Notwithstanding any other provision of the Plan to the contrary
(including without limitation Section 8.1 with respect to ISOs), in the
event of a Change in Control: (a) any Options outstanding as of the date of
such Change of Control that are not then fully exercisable and vested shall
become fully exercisable and vested to the full extent of the original
grant; and (b) all restrictions to which any Restricted Stock Awards are
subject at the time of such Change of Control shall lapse, and such
Restricted Stock shall become free of all restrictions and become fully
vested and transferable to the full extent of the original grant.
4. The foregoing amendments shall be applicable to all Outstanding Awards
to the same extent as if they were incorporated into the Agreements relating to
such Outstanding Awards, and any provisions of such Agreements with which such
amendments conflict shall be disregarded to the extent necessary to give effect
to such amendments.
5. Notwithstanding the foregoing, any amendment made by this First
Amendment to the Plan or to any Outstanding Award shall not be effective in
connection with a Change of Control or other corporate transaction that the
Corporation intends to be eligible for pooling-of-interests accounting under APB
No. 16 if and to the extent that giving effect to such amendment would make such
transaction ineligible for such ac-counting treatment.
6. The Plan is in all other respects ratified and affirmed without
amendment.
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