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EXHIBIT 10-A-11
CHRYSLER CORPORATION
STOCK OPTION PLAN
(as amended through February 6, 1997)
1. PURPOSE
The purpose of the Stock Option Plan is to enable Chrysler Corporation
(below called the Corporation) to be thoroughly competitive in encouraging
salaried officers and key employees and nonemployee Directors who are
responsible for the Corporation's future growth and success to remain in its
service and to attract others to it.
2. AMOUNT OF STOCK SUBJECT TO THIS PLAN
The total number of shares of Common Stock of the Corporation that may be
sold pursuant to options granted under this Plan shall not exceed (a) 1,500,000
shares as constituted at the time of the annual meeting of stockholders on April
19, 1966 reduced by the number of shares as to which options have been granted
and exercised since that time under any other stock option plan of the
Corporation, plus (b) 1,500,000 shares as constituted at the time of the annual
meeting of stockholders on May 3, 1977, plus (c) 3,500,000 shares as constituted
at the time of the annual meeting of stockholders on June 3, 1982 (all before
the three-for-two split of the Common Stock that became effective on February
20, 1986), plus (d) 7,500,000 shares as constituted at the time of the annual
meeting of stockholders on May 14, 1986. The shares sold under this Plan may be
either authorized and unissued shares or issued shares reacquired by the
Corporation at any time, as the Board of Directors from time to time may
determine. Unless and until the Board of Directors shall determine to purchase
shares in the market for the purpose of this Plan or to use treasury shares, the
shares sold under this Plan shall be authorized and unissued shares reserved for
that purpose. If any options granted under this Plan shall terminate, lapse or
expire for any reason without having been exercised in full, the shares not
purchased under the options shall be available again for the purposes of this
Plan; provided, however, that this sentence shall not apply to any shares as to
which an option is forfeited upon the exercise of a Stock Appreciation Right or
a Limited Stock Appreciation Right, as defined below.
3. ELIGIBILITY AND PARTICIPATION
Nonemployee Directors of the Corporation and salaried officers and key
employees of the Corporation, its subsidiaries and its Related Entities (as
defined below) who are responsible for or contribute to the management, growth
or profitability of the business of the Corporation, its subsidiaries or its
Related Entities shall be eligible to be granted options, and any former
employees of the Corporation, its subsidiaries and its Related Entities shall be
eligible to be granted Reload Options (as defined in paragraph 4 below) with
respect to stock options granted to such former employees; provided, however,
with respect to an employee of a Related Entity, that such person was an
employee of the Corporation, a subsidiary or, if originally an employee of the
Corporation or a subsidiary, or another Related Entity immediately prior to
becoming employed by such Related Entity and accepted employment with such
Related Entity at the request of the Corporation or a subsidiary. The term
"Related Entity" when used herein shall mean any corporation, joint venture or
other entity, domestic or foreign, other than a subsidiary, in which the
Corporation owns, directly or indirectly, a substantial equity interest. The
term "Nonemployee Director" means a Director who is not an employee of the
Corporation, any of its subsidiaries or any Related Entity.
4. GRANTING OF OPTIONS
The Board of Directors of the Corporation shall appoint a Stock Option
Committee (below called the Committee), consisting of not less than two
Nonemployee Directors, each of whom shall be a "Non-Employee Director" within
the meaning of Rule 16b-3 under the Securities Exchange Act of 1934, as amended
from time to time (the "Exchange Act"), or meet any other applicable standard
for administrators
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under that or any similar rule in effect from time to time. Each member of the
Committee shall be appointed by the Board and serve at the pleasure of the
Board. The Committee shall have the power and authority granted to it in this
and other paragraphs of this Plan; provided, however, that the Board of
Directors shall have the right to exercise any and all such power and authority
and to perform each and every function of the Committee whenever, in the sole
discretion of the Board, this seems expedient.
Subject to the express provisions of this Plan, the Committee shall have
authority in its discretion from time to time, (a) to determine the salaried
officers and key employees of the Corporation, its subsidiaries and its Related
Entities to receive options, the times when they shall receive them, the number
of shares to be subject to each option, and the option price, (b) to determine
the terms and provisions of the option agreements applicable to options granted
under this Plan, to construe such terms and provisions, and to correct any
defect or supply any omission or reconcile any inconsistency in any option
agreement, and (c) to prescribe, amend, and rescind rules and regulations
relating to this Plan. The determination of the Committee with respect to such
matters shall be conclusive. The Committee may permit a person to whom an option
has been granted and whose employment with the Corporation or any subsidiary is
terminated in connection with the acceptance of employment, at the Corporation's
or any subsidiary's request, with a Related Entity, to exercise his or her
options through their stated terms, provided the option holder maintains his or
her employment with such Related Entity through the date of exercise of the
option.
Unless otherwise expressly provided by the Committee in any specific
instance, the action of the Committee naming a salaried officer or key employee
of the Corporation, any subsidiary or any Related Entity to receive an option
pursuant to this Plan (or any of the appreciation rights permitted under
paragraph 6 of this Plan), determining the number of shares to be subject to the
option (or such appreciation rights), and setting the option price of the shares
subject to the option (or such appreciation rights) shall constitute the
granting of the option (or such appreciation rights), and the date when the
Committee shall take the action shall be the date of granting the option (or
such appreciation rights).
The Committee shall designate each option granted to a salaried officer or
key employee of the Corporation, any subsidiary or any Related Entity under this
Plan as either an Incentive Stock Option or a Nonqualified Stock Option. An
Incentive Stock Option shall be subject to all of the requirements of this Plan,
including those specified in paragraph 5 of this Plan. A Nonqualified Stock
Option shall be subject to all of the requirements of this Plan, except those
specified in paragraph 5 of this Plan.
The Committee shall have the authority to specify, at the time of grant or,
with respect to Nonqualified Stock Options, at or after the time of grant, that
the person to whom an option is or was granted under this Plan (which may
include a former salaried officer or key employee of the Corporation, any
subsidiary or any Related Entity) shall be granted a Nonqualified Stock Option
(a "Reload Option") in the event such person exercises all or a part of a stock
option (an "Original Option") by surrendering in accordance with paragraph 6 of
this Plan already owned shares of unrestricted Common Stock in full or partial
payment of the option price under such Original Option, subject to the
availability of shares of stock under this Plan at the time of such exercise.
Each Reload Option shall cover a number of shares of stock equal to the number
of shares of stock surrendered in payment of the option price under such
Original Option, shall have an option price per share of stock equal to the Fair
Market Value (as defined below) of the stock on the date of grant of such Reload
Option and shall expire on the stated expiration date of the Original Option. A
Reload Option shall be exercisable at any time and from time to time from and
after the date of grant of such Reload Option (or, as the Committee in its sole
discretion shall determine at or after the time of grant, at such time or times
as shall be specified in the Reload Option). Any Reload Option may provide for
the grant, when exercised, of subsequent Reload Options to the extent and upon
such terms and conditions, consistent with this paragraph 5, as the Committee in
its sole discretion shall specify at or after the time of grant of such Reload
Option. A Reload Option shall contain such other terms and conditions, which may
include a restriction on the transferability of the shares of stock received
upon exercise of the Original Option representing at least the after-tax profit
received upon exercise of the Original Option, as the Committee in its sole
discretion shall deem desirable and which may be set forth in rules or
guidelines adopted by the Committee or in the Stock Option Agreements evidencing
the Reload Options. The term "Fair Market Value" when used herein shall mean, as
of any given date, the mean of the high and low trading price of the Common
Stock of the
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Corporation on such date as reported on the New York Stock Exchange or, if the
stock is not then traded on the New York Stock Exchange, on such other national
securities exchange on which the stock is admitted to trade or, if none, on the
National Association of Securities Dealers Automated Quotation System if the
stock is admitted for quotation thereon; provided, however, that if any such
exchange or quotation system is closed on any day on which Fair Market Value is
to be determined, Fair Market Value shall be determined as of the first day
immediately preceding such day on which such exchange or quotation system was
open for trading.
5. INCENTIVE STOCK OPTIONS
An option designated by the Committee as an Incentive Stock Option is
intended to qualify as an "incentive stock option" within the meaning of
Subsection (b) of Section 422(A) of the Internal Revenue Code, and shall, in
addition to all other requirements of this Plan, be subject to the requirements
of this paragraph 5. An Incentive Stock Option may not be exercised by a person
while there is "outstanding", within the meaning of Section 422(A)(c)(7) of the
Internal Revenue Code or any amendment thereof in effect at the relevant time,
any Incentive Stock Option which was granted before the granting of such option,
to such person to purchase stock of the Corporation. An Incentive Stock Option
may not be granted to a person who at the time the option is granted owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Corporation, unless the option price of the shares of Common Stock
for which the option is granted to such person is not less than 110% of the Fair
Market Value of such stock at the time the option is granted and such option by
its terms is not exercisable after the expiration of five years from the date
such option is granted. The aggregate Fair Market Value, determined as of the
time the option is granted, of shares of Common Stock as to which any person may
be granted Incentive Stock Options in any calendar year shall not exceed
$100,000 plus any unused limit carryover to such year. In applying such calendar
year limitation, (a) the term "unused limit carryover" shall mean one-half of
the amount by which $100,000 exceeds the aggregate Fair Market Value, determined
as of the time the option is granted, of shares of Common Stock as to which the
person was granted options in any calendar year after 1980, (b) the amount of
options granted during a calendar year to a person shall be treated as first
using up the $100,000 limitation for that year, (c) to the extent that the
aggregate Fair Market Value, determined as of the time the option is granted, of
shares of Common Stock as to which options are granted to a person in any
calendar year, exceeds $100,000, the excess shall be treated as using up unused
limit carryovers to such year in the order of the calendar years in which the
carryovers arose, and (d) the amount of the unused limit carryover from any
calendar year which may be taken into account in any succeeding calendar year
shall be the amount of such carryover reduced by the amount of such carryover
which was used in prior calendar years; provided, however, that no unused limit
carryover may be carried over except to the three calendar years succeeding the
year in which it arose.
6. OPTION PRICE, PAYMENT AND APPRECIATION DISTRIBUTION
The option price of the shares of Common Stock subject to each option
granted to a salaried officer or key employee of the Corporation, any subsidiary
or any Related Entity pursuant to this Plan shall be set by the Committee and,
except as otherwise provided in paragraph 5 of this Plan, shall not be less than
100% of the Fair Market Value on the date of the granting of the option, as
determined by the Committee. Except as otherwise provided in this paragraph 6,
the option price shall be paid in full upon exercise of the option, in cash or
shares of Common Stock. The proceeds of sale of stock subject to the options are
to be added to the general funds of the Corporation and used for its corporate
purposes.
In connection with the payment of any federal, state or local taxes of any
kind required by law to be withheld with respect to any option, award or other
right under this Plan, the person to whom such option, award or other right is
granted may elect to have such tax withholding obligation satisfied, in whole or
in part, by (i) authorizing the Corporation to withhold from the shares of
Common Stock to be issued upon the exercise or vesting of such option, award or
right a number of shares of Common Stock with an aggregate Fair Market Value
that would satisfy the withholding amount due, or (ii) transferring to the
Corporation shares of Common Stock owned by that person with an aggregate Fair
Market Value that would satisfy the withholding amount due.
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The person to whom an option is granted under this Plan may, at the
discretion of the Committee, be granted at the time the option is granted, the
right (below called a Stock Appreciation Right) to elect as an alternative means
of exercising the option, to forfeit his option with respect to a number of
shares up to the Maximum Number of Shares, as defined below, in which case he
shall receive in cash or shares of Common Stock or any combination thereof, at
the sole discretion of the Committee, with respect to those shares as to which
he elects to forfeit his option, the Stock Appreciation, as defined below.
The person to whom an option is granted under this Plan may, at the
discretion of the Committee, be granted, at the time the option is granted, the
right (below called an Additional Appreciation Right) to receive at the time the
option is exercised, in cash or shares of Common Stock or any combination
thereof, at the sole discretion of the Committee, an amount equal to (a) the
number of shares he then purchased, multiplied by (b) the Stock Appreciation on
an equal number of shares; provided, however, that nonemployee Directors may not
be granted Additional Appreciation Rights.
The person to whom an option is granted under this Plan may, at the
discretion of the Committee, be granted at the time the option is granted (or,
in the case of a Nonqualified Stock Option, at any time after such option has
been granted, or in the case of an Incentive Stock Option, at any time after
such option has been granted and the holder thereof has requested that he be
granted the appreciation right provided for in this subparagraph and consents to
any conversion of such option into a Nonqualified Stock Option as a result of
such grant), the right (below called a Limited Stock Appreciation Right) to
elect during the sixty day period following a Change in Control, as defined
below, as an alternative means of exercising the option, to forfeit his option
with respect to a number of shares up to the total number of shares subject
thereto, in which case he shall receive in cash with respect to those shares as
to which he elects to forfeit his option, the Change in Control Stock
Appreciation, as defined below.
Any shares as to which an option is forfeited through the exercise of a
Stock Appreciation Right or a Limited Stock Appreciation Right shall no longer
be subject to the option or the related Stock Appreciation Right or Limited
Stock Appreciation Right and shall not be available for granting further options
under this Plan.
For purposes of this paragraph 6, (a) "Maximum Number of Shares" shall mean
(i) if the option is a Nonqualified Stock Option and the Committee has directed
that the Stock Appreciation shall be paid all in cash, the total number of
shares that the holder then could have purchased under the option, or (ii) if
the option is a Nonqualified Stock Option and the Committee has directed that
the Stock Appreciation shall be paid all in shares of Common Stock or in a
combination of cash and shares of Common Stock, or if the option is an Incentive
Stock Option, the lesser of (A) the number of shares he then purchased or (B)
the remaining number of shares that he then could have purchased under the
option, and (b) "Stock Appreciation" with respect to any shares of Common Stock
shall mean an amount equal to the difference between the option price of such
shares and the Fair Market Value of such shares on the date the option is
exercised.
For purposes of this Plan, "Change in Control" shall mean a Change in
Control of the Corporation, which shall be deemed to have occurred if:
(a) any Person, as defined below, is or becomes the Beneficial Owner,
as defined below, of securities of the Corporation representing 20% or more
of the combined voting power of the Corporation's then outstanding
securities (unless the event causing the 20% threshold to be crossed is an
acquisition of securities directly from the Corporation);
(b) during any period of two consecutive years beginning after June 7,
1990, individuals who at the beginning of such period constitute the Board
of Directors and any new Director (other than a Director designated by a
Person who has entered into an agreement with the Corporation to effect a
transaction described in clauses (a), (c) or (d) of this Change in Control
definition) whose election or nomination for election was approved by a
vote of at least two-thirds 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 of Directors;
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(c) the stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other corporation (other than a
merger or consolidation which would result in the voting securities of the
Corporation outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the entity surviving such merger or consolidation), in
combination with voting securities of the Corporation or such surviving
entity held by a trustee or other fiduciary pursuant to any employee
benefit plan of the Corporation or such surviving entity or of any
subsidiary of the Corporation or such surviving entity, at least 80% of the
combined voting power of the securities of the Corporation or such
surviving entity outstanding immediately after such merger or
consolidation); or
(d) the stockholders of the Corporation approve a plan of complete
liquidation or dissolution of the Corporation or an agreement for the sale
or disposition by the Corporation of all or substantially all the
Corporation's assets.
For purposes of the definition of Change in Control, "Person" shall have
the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act as
supplemented by Section 13(d)(3) of the Exchange Act, provided, however, that
Person shall not include (a) the Corporation, any subsidiary of the Corporation
or any other Person controlled by the Corporation, (b) any trustee or other
fiduciary holding securities under any employee benefit plan of the Corporation
or of any subsidiary of the Corporation, or (c) a corporation owned, directly or
indirectly, by the stockholders of the Corporation in substantially the same
proportions as their ownership of securities of the Corporation.
For purposes of the definition of Change in Control, a Person shall be
deemed the "Beneficial Owner" of any securities which such Person, directly or
indirectly, has the right to vote or dispose of or has "beneficial ownership" of
(within the meaning of Rule 13d-3 under the Exchange Act), including pursuant to
any agreement, arrangement or understanding (whether or not in writing);
provided, however, that: (a) a Person shall not be deemed the Beneficial Owner
of any security as a result of an agreement, arrangement or understanding to
vote such security (i) arising solely from a revocable proxy or consent given in
response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the Exchange Act and the applicable rules and regulations
thereunder or (ii) made in connection with, or to otherwise participate in, a
proxy or consent solicitation made, or to be made, pursuant to, and in
accordance with, the applicable provisions of the Exchange Act and the
applicable rules and regulations thereunder, in either case described in clause
(i) or clause (ii) above, whether or not such agreement, arrangement or
understanding is also then reportable by such Person on Schedule 13D under the
Exchange Act (or any comparable or successor report); and (b) a Person engaged
in business as an underwriter of securities shall not be deemed to be the
Beneficial Owner of any securities acquired through such Person's participation
in good faith in a firm commitment underwriting until the expiration of forty
days after the date of such acquisition.
For purposes of this paragraph 6, "Change in Control Stock Appreciation"
with respect to any share of Common Stock shall mean an amount equal to the
excess, if any, of
(a) the higher of (i) the Market Value of such share on the date the
option is exercised or (ii) (A) in the case of transactions described in
clauses (a) or (c) of the Change in Control definition, the highest per
share price paid (below called the Highest Price) for shares of Common
Stock of the Corporation in the transaction constituting the Change in
Control, (B) in the case of a transaction described in clause (b) of the
Change in Control definition which occurs in connection with a transaction
described in clauses (a), (c) or (d) of the Change in Control definition,
the Highest Price, (C) in the case of a transaction described in clause (b)
of the Change in Control definition which does not occur in connection with
a transaction described in clauses (a), (c) or (d) of the Change in Control
definition, the average of the daily closing prices per share of Common
Stock of the Corporation on the New York Stock Exchange, if such shares are
traded thereon, or, if not, such other national securities exchange on
which such shares are admitted to trade or, if none, the National
Association of Securities Dealers Automated Quotation System if such shares
are admitted for quotation thereon, on the thirty consecutive trading days
immediately preceding the Change in Control or (D) in the case of a
transaction described
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in clause (d) of the Change in Control definition, the equivalent of the
Highest Price as determined by the Committee, over
(b) the option price of such share, provided, however, that with
respect to a Limited Stock Appreciation Right associated with an option
which is an Incentive Stock Option immediately prior to the exercise of
such Limited Stock Appreciation Right, the Change in Control Stock
Appreciation thereon shall not exceed the maximum amount which will permit
such option to continue to qualify as an Incentive Stock Option.
7. PERIOD OF OPTION AND CERTAIN LIMITATIONS ON THE RIGHT TO EXERCISE
The person to whom an option is granted under this Plan (below called the
Option Holder) must remain in the continuous employ of the Corporation, any
subsidiary or any Related Entity of the Corporation for twelve consecutive
months from the date the option is granted before he can exercise any part of
the option, except that such requirement shall not apply to the exercise of
options, Stock Appreciation Rights, Additional Appreciation Rights or Limited
Stock Appreciation Rights following a Change in Control and except as provided
in paragraphs 8, 9 and 10 of this Plan. Thereafter,
(a) on and after the first anniversary of the date of granting the
option and before the second anniversary, he may buy not more than 40% of
the number of shares covered by the option,
(b) on and after the second anniversary and before the third
anniversary, he may buy not more than 70% thereof, and
(c) on and after the third anniversary and before the expiration of
the term of the option, which shall be not more than ten years from the
date of granting the option, he may buy all or from time to time any part
thereof
(the provisions of the foregoing clauses (a), (b) and (c) being hereinafter
called the Normal Exercise Provisions); provided, however, that
(x) the Committee shall have authority in its discretion to determine
that an option shall be exercisable under provisions other than the Normal
Exercise Provisions, so long as such other provisions do not at any time
permit the Option Holder to purchase a greater percentage of the shares
subject to the option than the Option Holder could purchase at such time
under the Normal Exercise Provisions, and in connection with any such
determination the Committee
(i) may retain the discretion to subsequently change any such other
provisions to the Normal Exercise Provisions or to other provisions not
more favorable than the Normal Exercise Provisions, and
(ii) may alter the application of paragraphs 8 and 9 of this Plan
with respect to any of the types of termination of employment referred
to therein but only during the period that any such other provisions
determined or changed pursuant to this proviso are in effect,
(y) except as otherwise determined pursuant to proviso (x) above, no
options may be exercised unless the Option Holder has been in the employ of
the Corporation, a subsidiary or a Related Entity continuously from the
date of granting the option or his employment was terminated for one of the
reasons referred to in paragraphs 8 and 9 of this Plan, and
(z) upon the occurrence of a Change in Control, all options, Stock
Appreciation Rights and Additional Appreciation Rights outstanding on the
date of such Change in Control shall become immediately and fully
exercisable.
In no case may an option be exercised for a fraction of a share.
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8. TERMINATION OF EMPLOYMENT
All the rights of an Option Holder under his option shall lapse if his
employment with the Corporation, any subsidiary or any Related Entity is
terminated for any reason other than those referred to in this paragraph 8 or in
paragraph 9 of this Plan.
If the employment of an Option Holder with the Corporation, any subsidiary
or any Related Entity is terminated (a) by reason of retirement or permanent
total disability, or (b) at or after age 55 under circumstances which the
Committee, in its discretion, deems equivalent to retirement, and in either case
he has been in the employ of the Corporation, any subsidiary or any Related
Entity continuously from the date of granting the option until the termination
of his employment, the Option Holder may exercise the option (and any associated
Stock Appreciation Right, Additional Appreciation Right or Limited Stock
Appreciation Right) after such termination of employment at any time within the
five year period commencing on the date of termination of his employment, but
not beyond the term of his option, and only to the extent that he would on the
date of exercise have been entitled under paragraph 7 of this Plan to exercise
the option (or any associated Stock Appreciation Right, Additional Appreciation
Right or Limited Stock Appreciation Right) if he had continued to be employed by
the Corporation, such subsidiary or such Related Entity.
If the employment of an Option Holder with the Corporation or any
subsidiary is terminated by the Corporation or such subsidiary under mutually
satisfactory conditions, or if an Option Holder's employment with a Related
Entity is terminated under conditions mutually satisfactory to such Related
Entity and the Option Holder, and he has been in the employ of the Corporation,
any subsidiary or any Related Entity continuously from the date of granting the
option until the termination of his employment, the Committee, in its
discretion, may permit the Option Holder to exercise the option (and any
associated Stock Appreciation Right, Additional Appreciation Right or Limited
Stock Appreciation Right) after such termination of employment at any time
within the one year period commencing on the date of termination of his
employment, but not beyond the term of his option, and only to the extent that
he would on the date of exercise have been entitled under paragraph 7 of this
Plan to exercise the option (or any associated Stock Appreciation Right,
Additional Appreciation Right or Limited Stock Appreciation Right) if he had
continued to be employed by the Corporation, such subsidiary or such Related
Entity.
Notwithstanding the above, the exercise of any option after termination of
employment shall be subject to satisfaction of the conditions precedent that the
Option Holder neither, (a) takes other employment or renders services to others
without the written consent of the Corporation, nor (b) conducts himself in a
manner adversely affecting the Corporation.
Notwithstanding the foregoing provisions of this paragraph 8 (including,
without limitation, the immediately preceding subparagraph of this paragraph 8),
if the employment of an Option Holder is terminated by the Corporation, any
subsidiary or any Related Entity for any reason within the two year period
immediately following a Change in Control, and he has been in the employ of the
Corporation, any subsidiary or any Related Entity continuously from the date of
granting the option until the termination of his employment, the Option Holder
shall be permitted to exercise the option (and any associated Stock Appreciation
Right, Additional Appreciation Right or Limited Stock Appreciation Right) after
such termination of employment at any time within the three month period
commencing on the date of termination of his employment, but not beyond the term
of his option, and only to the extent that he would on the date of exercise have
been entitled under paragraph 7 of this Plan to exercise the option (or any
related Stock Appreciation Right, Additional Appreciation Right or Limited Stock
Appreciation Right) if he had continued to be employed by the Corporation.
Options granted under this Plan shall not be affected by any change of
employment so long as the Option Holder continues to be an employee of the
Corporation, any subsidiary or any Related Entity. The option agreements may
contain such provisions as the Committee shall approve regarding the effect of
approved leaves of absence. Nothing in this Plan or in any option granted under
it shall confer any right to continue in the employ of the Corporation, any
subsidiary or any Related Entity, or interfere in any way with the right of the
Corporation, any subsidiary or any Related Entity, to terminate any employment
at any time.
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9. DEATH OF OPTION HOLDER
If (a) the employment of an Option Holder terminates by reason of death,
(b) an Option Holder dies within the five year period following termination of
employment (i) by reason of retirement or permanent total disability, or (ii) at
or after age 55 under circumstances which the Committee, in its discretion,
deems equivalent to retirement, (c) an Option Holder dies within the one year
period following termination of employment under mutually satisfactory
conditions and the Committee has determined that he may exercise the option
after such termination of employment, or (d) an Option Holder dies within the
three month period following termination of employment for any reason within the
two year period immediately following a Change in Control and if in any such
case he has been in the employ of either the Corporation, any subsidiary or any
Related Entity continuously from the date of granting the option until the
termination of his employment, the option theretofore granted to him may be
exercised by the legal representative of the deceased Option Holder at any time
within a period of one year after his death, but not beyond the term of the
option, and only to the extent that he was entitled to exercise the option on
the date of his death, plus, a pro rata portion of the additional number of
shares, if any, he would have become entitled to purchase under the option on
the anniversary of the date of granting the option that next follows the date of
his death (such pro rata portion to be 2 1/2% of the full number of shares for
which the option was granted for each full month during the twelve month period
preceding such anniversary that the Option Holder was alive).
10. GRANTING OF OPTIONS TO NONEMPLOYEE DIRECTORS
Each person who is not an employee of the Corporation or any of its
subsidiaries and who on and after May 14, 1986 is elected or reelected as a
Director of the Corporation at any annual or special meeting of stockholders of
the Corporation, shall as of the date of each such election or reelection
automatically be granted an option to purchase 1,000 shares of Common Stock (as
constituted at the time of the annual meeting of stockholders on May 14, 1986)
for an option price equal to 100% of Market Value on such date (and,
notwithstanding the discretion of the Committee under paragraph 6 of this Plan,
each such option granted on or after May 14, 1986 shall automatically have
associated with it a Stock Appreciation Right, the Stock Appreciation on which
shall be payable all in cash, and each such option granted on or after June 7,
1990 shall automatically have associated with it a Limited Stock Appreciation
Right, subject, in each case, to applicable law). The action of the stockholders
in electing or reelecting a nonemployee Director shall constitute the granting
of the option (and the associated Stock Appreciation Right and Limited Stock
Appreciation Right), and the date when the stockholders shall take such action
shall be the date of granting the option (and the associated Stock Appreciation
Right and Limited Stock Appreciation Right). All such options shall be
designated as Nonqualified Stock Options and, except as otherwise expressly
provided in this Plan, shall be subject to the same terms and provisions as are
then in effect with respect to granting of Nonqualified Stock Options to
salaried officers and key employees of the Corporation. Subject to the
foregoing, all provisions of this Plan not inconsistent with the foregoing shall
apply to options granted to nonemployee Directors, except that with respect to
an option (and the associated Stock Appreciation Right and Limited Stock
Appreciation Right) granted to a nonemployee Director, (a) any requirement for
employment with the Corporation, any subsidiary or any Related Entity shall be
deemed to be a requirement for service as a Director, (b) any requirement of
continuous employment shall be deemed to be a requirement of continuous service
as a Director, and (c) any reference to termination of employment shall be
deemed to mean termination of service as a Director. The maximum number of
shares as to which options may be granted to any nonemployee Director under this
Plan, as in effect through April 17, 1992, shall be 6,000 shares (as constituted
at the time of the annual meeting of stockholders on May 14, 1986).
11. NONTRANSFERABILITY OF OPTIONS; DEFERRAL OF PROCEEDS
No option granted under this Plan shall be transferable by the Option
Holder otherwise than by will or the laws of descent and distribution, and any
option may be exercised during the lifetime of the Option Holder only by him.
The Option Holder may elect, on or after the date of grant of an option
hereunder, to defer receipt of all or any portion of the proceeds, whether in
the form of cash or shares of Common Stock, deliverable to such
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Option Holder upon the exercise of an option or Stock Appreciation Right
hereunder set forth, in each case to the extent permitted by and subject to the
terms and conditions set forth in any deferral or similar plan or arrangement
enacted by the Board of Directors or the Committee in its sole discretion.
12. ADJUSTMENT FOR CHANGES IN CAPITALIZATION
Notwithstanding any other provision of this Plan, in the event of any
change in the outstanding Common Stock of the Corporation by reason of a stock
dividend, recapitalization, merger, consolidation, split-up, combination or
exchange of shares, and the like, the aggregate number and class of shares
available under this Plan and the number and class of shares subject to each
outstanding option and the option prices shall be appropriately adjusted by the
Board of Directors, whose determination shall be conclusive.
13. INTERPRETATION
The Board of Directors shall have full power and authority to interpret and
construe this Plan and its interpreting and construing of this Plan and acts
pursuant to this Plan in good faith shall be final and conclusive. The Board of
Directors may correct any defect or supply any omission or reconcile any
inconsistency in such a manner and to such an extent as it shall find expedient
to carry this Plan into effect, and it shall be the sole and final judge of the
expediency. If any such interpreting or construing shall involve a question of
law, the Board of Directors may rely and act upon the opinion of counsel (who
may be of counsel to the Corporation) on the question of law.
This Plan is intended to satisfy the conditions of Rule 16b-3 under the
Exchange Act, and all interpretations of this Plan shall to the extent permitted
by law, regulations and rulings be made in a manner consistent with and so as to
satisfy the conditions of Rule 16b-3. In interpreting and applying the
provisions of this Plan any option granted as an Incentive Stock Option pursuant
to this Plan shall to the extent permitted by law, regulations and rulings be
construed as, and any ambiguity shall be resolved in favor of preserving its
status as, an "incentive stock option" within the meaning of Subsection (b) of
Section 422(A) of the Internal Revenue Code.
Notwithstanding any provision to the contrary in this Plan or in any
Incentive Stock Option granted pursuant to this Plan, if any change in law or
any regulation or ruling of the Internal Revenue Service shall have the effect
of disqualifying any Incentive Stock Option granted under this Plan as an
"incentive stock option" within the meaning of Subsection (b) of Section 422(A)
of the Internal Revenue Code, the option granted shall nevertheless continue to
be outstanding as and shall be deemed to be a Nonqualified Stock Option under
this Plan, and in such event paragraph 5 of this Plan shall cease to be
operative with respect to such option.
14. AMENDMENT AND TERMINATION
The Board of Directors of the Corporation or the Committee may at any time
terminate this Plan or make such changes in it and additions to it as it shall
deem advisable, including but not limited to, provisions changing the percentage
of shares as to which an option that so provides must be exercised relative to
shares forfeited in connection with the receipt of the appreciation on the
forfeited shares; provided, however, that except as provided in paragraph 12
hereof, the Board of Directors may not, without further approval by the holders
of a majority of the shares of Common Stock of the Corporation then outstanding
and entitled to vote, increase the maximum number of shares as to which options
may be granted under this Plan or reduce the minimum option price or extend the
period during which options may be granted or exercised or change the class of
persons eligible to receive options under this Plan. Unless terminated earlier
by the Board of Directors, this Plan shall terminate on April 17, 1992, and no
options under it shall be granted thereafter; provided, however, that options
granted prior to April 17, 1992 may extend beyond that date; and provided,
further, however, that Reload Options may be granted prior to and on and after
April 17, 1992, but no Reload Option shall be exercisable after any date which
is later than the date on which a Stock Option granted prior to April 17, 1992
could be exercised. No termination or amendment of this Plan may, without the
written
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consent of the Option Holder of an option then existing, terminate his option or
materially and adversely affect his rights under the Option.
15. EFFECTIVE PERIOD
The effective date of this Plan was originally January 13, 1972, subject,
however, to approval of this Plan by the vote of the holders of a majority of
the shares of Common Stock of the Corporation outstanding and entitled to vote,
which approval was obtained at the annual meeting of the stockholders on April
18, 1972. This Plan was readopted by the Board of Directors following approval
by the vote of the holders of a majority of the shares of Common Stock of the
Corporation outstanding and entitled to vote at the annual meeting of the
stockholders on June 3, 1982. Subject to the express provisions of this Plan,
options may be granted under this Plan at any time and from time to time prior
to termination of this Plan.
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