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Exhibit 4.5
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CORE INDUSTRIES INC
1988 Director Discounted Stock Option Plan
1. Definitions: As used herein, the following definitions shall
apply:
(a) "Plan" shall mean this Core Industries Inc 1988 Director
Discounted Stock Option Plan.
(b) "Committee" shall mean (i) a committee meeting the standards
of Rule 16b-3 of the Rules and Regulations under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or any similar
successor rule, appointed by the Board of Directors of the Corporation
to administer the Plan or, (ii) if no such committee is appointed, the
Board of Directors of the Corporation as a whole, provided that a
majority of the members of the Board are "disinterested persons" within
the meaning of Rule 16b-3.
(c) "Corporation" shall mean Core Industries Inc, a Nevada
corporation, or any successor thereof.
(d) "Participant" shall mean each member of the Corporation's
Board of Directors who is not an employee of the Corporation or of any
subsidiary of the Corporation. For purposes of the Plan, a
"subsidiary" is any corporation in which the Corporation owns,
directly or indirectly, stock possessing more than fifty percent of the
combined voting power of all classes of stock.
(e) "Nonqualified Option" shall mean an option to purchase Common
Stock of the Corporation which meets the requirements set forth in the
Plan but does not meet the definition of an incentive stock option set
forth in Section 422A of the Internal Revenue Code of 1986, as amended
(the "Code").
(f) "Market Value" shall mean the average of the highest and
lowest quoted selling prices of the Corporation's Common Stock on any
exchange or other market on which the shares of Common Stock of the
Corporation shall be traded on such date. If no shares of the
Corporation's Common Stock shall be traded on such date, "Market Value"
shall mean the average between the highest and lowest quoted selling
prices on the next preceding date on which any sales of the
Corporation's Common Stock shall have occurred.
(g) "Total Director Fees" shall mean the maximum amount of
director fees (including all fees receivable for attendance at Board of
Directors meetings, but excluding fees associated with service for any
committee of the Board of Directors) payable to a Participant during a
calendar year.
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(h) "Director Notice" shall mean an irrevocable written notice
delivered by a Participant to the Corporation prior to January 1 of any
year, to be effective for such calendar year or years as are specified
in such notice.
(i) "Designated Director Fees" shall mean the portion of a
Participant's Total Director Fees which shall be represented by grants
of Nonqualified Options pursuant to this Plan in lieu of cash payments
to such Participant, as specified by a Participant in a Director
Notice.
(j) "Option Price" shall mean the price at which a Nonqualified
Option may be exercised, as specified by a Participant in a Director
Notice, and which shall equal either 50% or 75% of Market Value on the
date of grant of such Nonqualified Option.
2. PURPOSE OF PLAN: The purpose of the Plan is to provide
non-employee directors of the Corporation with an increased incentive to make
significant and extraordinary contributions to the long-term performance and
growth of the Corporation and its subsidiaries, to joint the interests of
non-employee directors with the interests of the stockholders of the
Corporation, and to facilitate attracting and retaining non-employee directors
of exceptional ability.
3. ADMINISTRATION: The Plan shall be administered by the Committee.
Subject to the provisions of the Plan, the Committee is authorized to interpret
the Plan, to promulgate, amend and rescind rules and regulations relating to
the Plan and to make all other determinations necessary or advisable for its
administration. Interpretation and construction of any provision of the Plan by
the Committee shall be final and conclusive. Acts approved by a majority of the
members present at any meeting at which a quorum is present, or acts
unanimously approved in writing by the Committee, shall be the acts of the
Committee.
4. ANNUAL GRANTS: On January 1 of each year following the effective
date of the Plan, each Participant shall receive a Nonqualified Option covering
that whole number of shares of the Corporation's Common Stock as is closest to
the quotient of (i) the Designated Director Fees, as set forth in the
Participant's Director Notice in effect for such year, divided by (ii) the
difference between Market Value and Option Price, as set forth in the
Participant's Director Notice in effect for such year. The option exercise
price for each such Nonqualified Option shall be such Option Price. Each
Participant's director fees to be received in cash for any year shall be
reduced by the Designated Director Fees as set forth in the Participant's
Director Notice in effect for such year.
5. INDEMNIFICATION OF COMMITTEE MEMBERS: In addition to such other
rights of indemnification as they may have, the members of the Committee shall
be indemnified by the Corporation against the reasonable expenses, including
attorneys' fees, actually and necessarily incurred in connection with the
defense of any action, suit or proceeding, or in connection with
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any appeal therein, to which they or any of them may be a party by reason of
any action taken or failure to act under or in connection with the Plan or any
option granted hereunder, and against all amounts paid by them in settlement
thereof (provided such settlement is approved by independent legal counsel
selected by the Corporation) or paid by them in satisfaction of a judgment in
any such action, suit or proceeding, except in relation to matters as to which
it shall be adjudged in such action, suit or proceeding that such Committee
member has acted in bad faith; provided, however, that within sixty (60) days
after receipt of notice of institution of any such action, suit or proceeding
a Committee member shall offer the Corporation in writing the opportunity, at
its own cost, to handle and defend the same.
6. MAXIMUM NUMBER OF SHARES SUBJECT TO PLAN: The maximum number of
shares with respect to which stock options may be granted under the Plan shall
be 100,000 shares in the aggregate of Common Stock of the Corporation, which
may consist in whole or in part of the authorized and unissued or reacquired
Common Stock of the Corporation. If a stock option expires or terminates for
any reason without having been fully exercised, the number of shares with
respect to which the stock option was not exercised at the time of its
expiration or termination shall again become available for the grant of stock
options under the Plan, unless the Plan shall have been terminated.
The number of shares subject to each outstanding stock option, the
option price with respect to outstanding stock options, and the aggregate
number of shares remaining available under the Plan shall be subject to such
adjustment as the Committee, in its discretion, deems appropriate to reflect
such events as stock dividends, stock splits, recapitalizations, mergers,
consolidations or reorganizations of or by the Corporation. Provided, however,
that no fractional shares shall be issued pursuant to the Plan, no rights may
be granted under the Plan with respect to fractional shares, and any fractional
shares resulting from such adjustments shall be eliminated from any outstanding
stock option.
7. WRITTEN AGREEMENT: Each stock option shall be evidenced by a
written agreement and shall contain such provisions as may be approved by the
Committee. Such agreements shall constitute binding contracts between the
Corporation and the Participant, and every Participant, upon acceptance of such
agreement, shall be bound by the terms and restrictions of the Plan and of such
agreement. The terms of each such agreement shall be in accordance with the
Plan, but the agreements may include such additional provisions and restrictions
determined by the Committee, provided that such additional provisions and
restrictions are not inconsistent with the terms of the Plan.
8. PAYMENT OF STOCK OPTION PRICE: To exercise in whole or in part any
stock option granted hereunder, payment of the option price in full in cash or,
with the consent of the Committee, in Common Stock of the Corporation, shall
be made by the Participant for all shares so purchased. In the discretion of
and subject to such conditions as may be established by the Committee, payment
of the option price may also be made by the
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Corporation retaining from the shares to be delivered upon exercise of the
stock option that number of shares having a fair market value on the date of
exercise equal to the option price of the number of shares with respect to
which the Participant exercises the stock option. No Participant shall have
any of the rights of a stockholder of the Corporation under any stock option
until the actual issuance of shares to said Participant, and prior to such
issuance no adjustment shall be made for dividends, distributions or other
rights in respect of such shares, except as provided in Paragraph 6.
9. EXERCISE OF STOCK OPTIONS: A Participant may exercise a stock
option, in whole or in part by delivery to the Corporation of written notice of
the exercise, in such form as the Committee may prescribe, accompanied by (i)
full payment for the shares with respect to which the stock option is
exercised, in cash or, in the sole discretion of the Committee, in Common Stock
of the Corporation or (ii) in the sole discretion of the Committee, irrevocable
instructions to a stock broker to promptly deliver to the Corporation full
payment for the shares with respect to which the stock option is exercised from
the proceeds of the stock broker's sale of or loan against the shares.
Successive stock options may be granted to the same Participant,
whether or not the stock option(s) previously granted to such Participant
remain unexercised. A Participant may exercise a stock option, if then
exercisable, notwithstanding that stock options previously granted to such
Participant remain unexercised.
10. NON-TRANSFERABILITY OF STOCK OPTIONS: No stock option granted
under the Plan to a Participant shall be transferable by such Participant
otherwise than by will, or by the laws of descent and distribution, and stock
options shall be exercisable, during the lifetime of the Participant, only by
the Participant.
11. TERM OF STOCK OPTIONS: If not sooner terminated, each stock option
granted hereunder shall expire not more than 10 years from the date of the
granting thereof, nor more than two years following the date upon which the
Participant ceases to be a member of the Corporation's Board of Directors. If
during any year a Participant fails to attend any meeting of the Board of
Directors, the portion (if any) of such Participant's director fees which were
not included in Designated Director Fees, and which the Participant therefore
elected to receive in cash, shall first be reduced and then, to the extent
necessary, the Participant's Nonqualified Option granted in such year shall be
reduced by that whole number of shares of Common Stock closest to the quotient
determined by dividing (i) the amount of remaining directors fees not received
by such Participant by (ii) the difference between the Market Value on the date
of grant and the applicable Option Price.
12. INVESTMENT PURPOSE: If the Committee in its discretion determines
that as a matter of law such procedure is or may be desirable, it may require a
Participant, upon any acquisition of stock hereunder and as a
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condition to the Corporation's obligation to deliver certificates representing
such shares, to execute and deliver to the Corporation a written statement, in
form satisfactory to the Committee, representing and warranting that the
Participant's acquisition of shares of stock shall be for such person's own
account, for investment and not with a view to the resale or distribution
thereof and that any subsequent offer for sale or sale of any such shares shall
be made either pursuant to (a) a Registration Statement on an appropriate form
under the Securities Act of 1933, as amended (the "Securities Act"), which
Registration Statement has become effective and is current with respect to the
shares being offered and sold, or (b) a specific exemption from the
registration requirements of the Securities Act, but in claiming such exemption
the Participant shall, prior to any offer for sale or sale of such shares,
obtain either the Corporation's approval or a favorable written opinion from
counsel for or approved by the Corporation as to the availability of such
exemption. The Corporation may endorse an appropriate legend referring to the
foregoing restiction upon the certificate or certificates representing any
shares issued or transferred to the Participant under this Plan.
13. RIGHT TO CONTINUED SERVICE AS A DIRECTOR: Nothing contained in the
Plan or in any stock option granted pursuant to the Plan, nor any action taken
by the Committee hereunder, shall confer upon any Participant any right with
respect to continuation of service as a director of the Corporation nor
interfere in any way with the right of the Corporation or its stockholders to
terminate such Participant's service as a director of the Corporation at any
time.
14. WITHHOLDING PAYMENTS: If upon the exercise of an option there
shall be payable by the Corporation any amount for income tax withholding, then
in the Committee's sole discretion, either the Corporation shall appropriately
reduce the amount of stock to be paid to the Participant or the Participant
shall pay such amount to the Corporation to reimburse it for such income tax
withholding. The Committee may, in its sole discretion, permit Participants to
satisfy such withholding obligations, in whole or in part, by electing to have
the amount of Common Stock delivered or deliverable upon exercise of a stock
option appropriately reduced, or by electing to tender Common Stock back to the
Corporation for such income tax withholding, subject to such rules and
regulations as the Committee may adopt. The Committee may make such other
arrangements with respect to income tax withholding as it shall determine.
15. EFFECTIVENESS OF PLAN: The Plan shall be effective on the date the
Board of Directors of the Corporation adopts the Plan, provided that the
stockholders of the Corporation approve the Plan within 12 months of its
adoption by the Board of Directors. Stock options may be granted prior to
stockholder approval of the Plan, but each such stock option grant shall be
subject to stockholder approval of the Plan. No stock option may be exercised
prior to stockholder approval.
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16. TERMINATION, DURATION AND AMENDMENTS OF PLAN: The Plan may be
abandoned or terminated at any time by the Board of Directors of the
Corporation. Unless sooner terminated, the Plan shall terminate on the date
ten years after its adoption by the Board of Directors, and no stock options may
be granted thereafter. The termination of the Plan shall not affect the
validity of any stock option outstanding on the date of termination.
For the purpose of conforming to any changes in applicable law or
govermental regulations, or for any other lawful purpose, the Board of Directors
shall have the right, with or without approval of the stockholders of the
Corporation, to amend or revise the terms of the Plan at any time; provided,
however, that no such amendment or revision shall (i) increase the maximum
number of shares in the aggregate which are subject to the Plan (subject,
however, to the provisions of Paragraph 6), change the class of persons
eligible to be Participants under the Plan or materially increase the benefits
accruing to Participants under the Plan, without approval or ratification
of the stockholders of the Corporation; or (ii) change the stock option price
(except as contemplated by Paragraph 6) or alter or impair any stock option
which shall have been previously granted under the Plan, without the consent
of the holder thereof.
As adopted by the Board of Directors on November 15, 1988.
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