Exhibit 10.4
STEWART INFORMATION SERVICES CORPORATION
2002 STOCK OPTION PLAN FOR REGION MANAGERS
TABLE OF CONTENTS
SECTION
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ARTICLE I PLAN
Purpose ...............................................1.1
Term of Plan ..........................................1.2
ARTICLE II DEFINITIONS
Affiliate .............................................2.1
Board .................................................2.2
Code ..................................................2.3
Committee .............................................2.4
Company ...............................................2.5
Employee ..............................................2.6
Fair Market Value .....................................2.7
Holder ................................................2.8
Incentive Option ......................................2.9
Mature Shares ........................................2.10
Nonqualified Option ..................................2.11
Option ...............................................2.12
Option Agreement .....................................2.13
Plan .................................................2.14
Region Manager .......................................2.15
Stock ................................................2.16
ARTICLE III ELIGIBILITY
ARTICLE IV GENERAL PROVISIONS RELATING TO OPTIONS
Authority to Grant Options ............................4.1
Dedicated Shares; Maximum Options .....................4.2
Non-Transferability ...................................4.3
Requirements of Law ...................................4.4
Changes in the Company's Capital Structure ............4.5
ARTICLE V OPTIONS
Type of Option ........................................5.1
Exercise Price ........................................5.2
Duration of Options ...................................5.3
Amount Exercisable ....................................5.4
Exercise of Options ...................................5.5
Substitution Options ..................................5.6
No Rights as Stockholder ..............................5.7
ARTICLE VI ADMINISTRATION
ARTICLE VII AMENDMENT OR TERMINATION OF PLAN
ARTICLE VIII MISCELLANEOUS
No Establishment of a Trust Fund ......................8.1
No Employment Obligation ..............................8.2
Forfeiture ............................................8.3
Tax Withholding .......................................8.4
ii
Written Agreement .....................................8.5
Indemnification of the Committee ......................8.6
Gender ................................................8.7
Headings ..............................................8.8
Other Compensation Plans ..............................8.9
Other Options .......................................8.10
Governing Law ........................................8.11
PLAN
PURPOSE. The Plan is intended to advance the best interests of the Company and
its stockholders by providing those persons who have substantial responsibility
for the management and growth of the Company and its Affiliates with additional
incentives and an opportunity to obtain or increase their proprietary interest
in the Company, thereby encouraging them to continue in their employment with
the Company or any of its Affiliates.
TERM OF PLAN. No Option shall be granted under the Plan after March 18, 2012.
The Plan shall remain in effect until all Options under the Plan have been
satisfied or expired.
DEFINITIONS
The words and phrases defined in this Article shall have the meaning set out in
these definitions throughout the Plan, unless the context in which any such word
or phrase appears reasonably requires a broader, narrower or different meaning.
"AFFILIATE" means any parent corporation and any subsidiary corporation. The
term "parent corporation" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, at the time of the
action or transaction, each of the corporations other than the Company owns
stock possessing 50 percent or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain. The term
"subsidiary corporation" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time of the
action or transaction, each of the corporations other than the last corporation
in the unbroken chain owns stock possessing 50 percent or more of the total
combined voting power of all classes of stock in one of the other corporations
in the chain.
"BOARD" means the board of directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMITTEE" means the Salary Committee of the Company.
"COMPANY" means Stewart Information Services Corporation, a Delaware
corporation.
"EMPLOYEE" means a person employed by the Company or any Affiliate as a common
law employee.
"FAIR MARKET VALUE" of the Stock as of any date means the closing price of the
Stock on such date, or, if the Stock was not traded on such date, on the
immediately preceding day that the Stock was so traded. However, if the Stock is
not listed on a securities exchange or quotation system, the Fair Market Value
will be an amount determined by the Committee.
"HOLDER" means a person who has been granted an Option or any person who is
entitled to receive stock under an Option.
"INCENTIVE OPTION" means an Option granted under the Plan which is designated as
an "Incentive Option" and satisfies the requirements of section 422 of the Code.
"MATURE SHARES" means shares of Stock that the Holder has held for at least six
months.
"NONQUALIFIED OPTION" means an Option granted under the Plan other than an
Incentive Option.
"OPTION" means either an Incentive Option or a Nonqualified Option granted under
the Plan to purchase shares of Stock.
"OPTION AGREEMENT" means the written agreement which sets out the terms of an
Option.
"PLAN" means the Stewart Information Services Corporation 2002 Stock Option Plan
for Region Managers, as set forth in this document and as it may be amended from
time to time.
"REGION MANAGER" means an Employee who holds the title "Region Manager" or an
Employee who the Committee, in its sole discretion, determines has a position
equivalent to the position of a Region Manager.
"STOCK" means the common stock of the Company, $1.00 par value, or, in the event
that the outstanding shares of common stock are later changed into or exchanged
for a different class of stock or securities of the Company or another
corporation, that other stock or security.
ELIGIBILITY
The individuals who shall be eligible to receive Options shall be those
full-time key Employees, including officers and directors, who are employed on
the date an Option is granted as a Region Manager and who have substantial
responsibility for the management and growth of the Company or any of its
Affiliates as the Committee shall determine from time to time.
GENERAL PROVISIONS RELATING TO OPTIONS
AUTHORITY TO GRANT OPTIONS. The Committee may grant Options to those eligible
Region Managers as it shall from time to time determine, under the terms and
conditions of the Plan. Factors the Committee may consider include, without
limitation:
Region rank of consolidated STG/STC pretax profit (dollars) in the Region
Manager's territory as reported on the Region Manager's consolidated profit
center statement;
Region rank of profit percentage in the Region Manager's territory as reported
on the Region Manager's STG/STC profit center statement; Region rank of
percentage of policy losses to premiums generated YTD as reported on the Region
Performance Summary Report;
Market share increase in the Region Manger's territory over the prior year as
reported on the quarterly ALTA statistics on market share. Market share weight
will be increased with market share growth in key states and percentage of state
responsibility of Region Manager;
Region rank of percentage increase in Cash to Houston remittances as reported on
the Region Performance Summary Report;
Region rank of percentage of delinquent premium YTD; Net expansion of territory
via acquisitions, branch offices, increased number of agents;
Region Manager incorporation and pursuit of SISCO Strategies (Service,
Technology, Growth, Communication) and Ten Standards in region's goals;
Other contributions towards overall company performance or failure to comply
with company requests. Items considered may include Region Manager rollout of
technology, new products or other programs sponsored by the company, completion
of agency visits, follow-up on audits and training and benefit participation.
The Committee shall evaluate the relative importance of these factors, and the
Region Manager's standing among the recipient group, in its sole and absolute
discretion and shall have full power and authority to determine according to the
above criteria the amount of shares subject to any option, subject only to any
applicable limitations set out in the Plan.
DEDICATED SHARES; MAXIMUM OPTIONS. The aggregate number of shares of Stock with
respect to which Options may be granted under the Plan is 300,000. Such shares
of Stock may be treasury shares or authorized but unissued shares. The number of
shares stated in this Section 4.2 shall be subject to adjustment in accordance
with the provisions of Section 4.5. If any outstanding Option expires or
terminates for any reason or any Option is surrendered, the shares of Stock
allocable to the unexercised portion of that Option may again be subject to an
Option granted under the Plan.
NON-TRANSFERABILITY. Incentive Options shall not be transferable by the Holder
other than by will or under the laws of descent and distribution, and shall be
exercisable, during the Holder's lifetime, only by him or her. Except as
specified in domestic relations court orders, Nonqualified Options shall not be
transferable by the Holder other than by will or under the laws of descent and
distribution, and shall be exercisable, during the Holder's lifetime, only by
him or her. In the discretion of the Committee, any attempt to transfer an
Option other than under the terms of the Plan and the applicable Option
agreement may terminate the Option.
REQUIREMENTS OF LAW. The Company shall not be required to sell or issue any
Stock under any Option if issuing that Stock would constitute or result in a
violation by the Holder or the Company of any provision of any law, statute or
regulation of any governmental authority. Specifically, in connection with any
applicable statute or regulation relating to the registration of securities,
upon exercise of any Option, the Company shall not be required to issue any
Stock unless the Committee has received evidence satisfactory to it to the
effect that the Holder will not transfer the Stock except in accordance with
applicable law, including receipt of an opinion of counsel satisfactory to the
Company to the effect that any proposed transfer complies with applicable law.
The determination by the Committee on this matter shall be final, binding and
conclusive. The Company may, but shall in no event be obligated to, register any
Stock covered by the Plan pursuant to applicable securities laws of any country
or any political subdivision. In the event the Stock issuable on exercise of an
Option is not registered, the Company may imprint on the certificate evidencing
the Stock any legend that counsel for the Company considers necessary or
advisable to comply with applicable law. The Company shall not be obligated to
take any other affirmative action in order to cause the exercise of an Option,
or the issuance of shares pursuant thereto, to comply with any law or regulation
of any governmental authority.
CHANGES IN THE COMPANY'S CAPITAL STRUCTURE.
The existence of outstanding Options shall not affect in any way the right or
power of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business, any merger or consolidation of the
Company, any issue of bonds, debentures, preferred or prior preference stock
ahead of or affecting the Stock or its rights, the dissolution or liquidation of
the Company, any sale or transfer of all or any part of its assets or business
or any other corporate act or proceeding, whether of a similar character or
otherwise. If the Company shall effect a subdivision or consolidation of shares
or other capital readjustment, the payment of a stock dividend, or other
increase or reduction of the number of shares of Stock outstanding, without
receiving compensation for money, services or property, then (i) the number,
class or series and per share price of shares of Stock subject to outstanding
Options under this Plan shall be appropriately adjusted in such a manner as to
entitle a Holder to receive upon exercise of an Option, for the same aggregate
cash consideration, the equivalent total number and class or series of shares
the Holder would have received had the Holder exercised his or her Option in
full immediately prior to the event requiring the adjustment, and (ii) the
number and class or series of shares of Stock then
reserved to be issued under the Plan shall be adjusted by substituting for the
total number and class or series of shares of Stock then reserved, that number
and class or series of shares of Stock that would have been received by the
owner of an equal number of outstanding shares of each class or series of Stock
as the result of the event requiring the adjustment.
If while unexercised Options remain outstanding under the Plan (i) the Company
shall not be the surviving entity in any merger, consolidation or other
reorganization (or survives only as a subsidiary of an entity other than an
entity that was wholly-owned by the Company immediately prior to such merger,
consolidation or other reorganization), (ii) the Company sells, leases or
exchanges or agrees to sell, lease or exchange all or substantially all of its
assets to any other person or entity (other than an entity wholly-owned by the
Company), (iii) the Company is to be dissolved or (iv) the Company is a party to
any other corporate transaction (as defined under section 424(a) of the Code and
applicable Department of Treasury Regulations) that is not described in clauses
(i), (ii) or (iii) of this sentence (each such event is referred to herein as a
"Corporate Change"), then, except as otherwise provided in an Option Agreement
or as a result of the Board's effectuation of one or more of the alternatives
described below, there shall be no acceleration of the time at which any Option
then outstanding may be exercised, and no later than ten days after the approval
by the stockholders of the Company of such Corporate Change, the Board, acting
in its sole and absolute discretion without the consent or approval of any
Holder, shall act to effect one or more of the following alternatives, which may
vary among individual Holders and which may vary among Options held by any
individual Holder:
accelerate the time at which some or all of the Options then outstanding may be
exercised so that such Options may be exercised in full for a limited period of
time on or before a specified date (before or after such Corporate Change) fixed
by the Board, after which specified date all such Options that remain
unexercised and all rights of Holders thereunder shall terminate;
require the mandatory surrender to the Company by all or selected Holders of
some or all of the then outstanding Options held by such Holders (irrespective
of whether such Options are then exercisable under the provisions of this Plan
or the Option Agreements evidencing such Options) as of a date, before or after
such Corporate Change, specified by the Board, in which event the Board shall
thereupon cancel such Options and the Company shall pay to each such Holder an
amount of cash per share equal to the excess, if any, of the per share price
offered to stockholders of the Company in connection with such Corporate Change
over the exercise prices under such Options for such shares;
with respect to all or selected Holders, have some or all of their then
outstanding Options (whether vested or unvested) assumed or have a new Option
substituted for some or all of their then outstanding Options (whether vested or
unvested) by an entity which is a party to the transaction resulting in such
Corporate Change and which is then employing such Holder or which is affiliated
or associated with such Holder in the same or a substantially similar manner as
the Company prior to the Corporate Change, or a parent or subsidiary of such
entity, provided that (A) such assumption or substitution is on a basis where
the excess of the aggregate fair market value of the shares subject to the
Option immediately after the assumption or substitution over the aggregate
exercise price of such shares is equal to the excess of the aggregate fair
market value of all shares subject to the Option immediately before such
assumption or substitution over the aggregate exercise price of such shares, and
(B) the assumed rights under such existing Option or the substituted rights
under such new Option as the case may be will have the same terms and conditions
as the rights under the existing Option assumed or substituted for, as the case
may be;
provide that the number and class or series of shares of Stock covered by an
Option (whether vested or unvested) theretofore granted shall be adjusted so
that such Option when exercised shall thereafter cover the number and class or
series of shares of stock or other securities or property (including, without
limitation, cash) to which the Holder would have been entitled pursuant to the
terms of the agreement or plan relating to such Corporate Change if, immediately
prior to such Corporate Change, the Holder had been the holder of record of the
number of shares of Stock then covered by such Option; or
make such adjustments to Options then outstanding as the Board deems appropriate
to reflect such Corporate Change (provided, however, that the Board may
determine in its sole and absolute discretion that no such adjustment is
necessary).
In effecting one or more of alternatives (3), (4) or (5) above, and except as
otherwise may be provided in an Option Agreement, the Board, in its sole and
absolute discretion and without the consent or approval of any Holder, may
accelerate the time at which some or all Options then outstanding may be
exercised. In the event of changes in the outstanding Stock by reason of
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges or other relevant changes in capitalization occurring after the date
of the grant of any Option and not otherwise provided for by this Section 4.5,
any outstanding Options and any agreements evidencing such Options shall be
subject to adjustment by the Board in its sole and absolute discretion as to the
number and price of shares of stock or other consideration subject to such
Options.
In the event of any such change in the outstanding Stock, the aggregate number
of shares available under this Plan may be appropriately adjusted by the Board,
whose determination shall be conclusive. The issuance by the Company of shares
of stock of any class or series, or securities convertible into shares of stock
of any class or series, for cash or property, or for labor or services either
upon direct sale or upon the exercise of rights or warrants to subscribe for
them, or upon conversion or exchange of shares or obligations of the Company
convertible into, or exchangeable for, shares or other securities, shall not
affect, and no adjustment by reason of such issuance shall be made with respect
to, the number, class or series, or price of shares of Stock then subject to
outstanding Options.
OPTIONS
TYPE OF OPTION. The Committee shall specify in an Option Agreement whether a
given Option is an Incentive Option or a Nonqualified Option. Notwithstanding
such designation, however, to the extent that the aggregate Fair Market Value
(determined as of the time an Incentive Option is granted) of the Stock with
respect to which incentive stock options first become exercisable by an Employee
during any calendar year (under the Plan and any other incentive stock option
plan(s) of the Company or any Affiliate) exceeds $100,000, the Incentive Option
shall be treated as a Nonqualified Option. In making this determination,
incentive stock options shall be taken into account in the order in which they
were granted.
EXERCISE PRICE. The price for which Stock may be purchased under an Option shall
not be less than 100 percent of the Fair Market Value of the shares of Stock on
the date the Option is granted.
DURATION OF OPTIONS. Unless the Option Agreement specifies a shorter general
term, an Option shall expire on the earliest of the date that is (a) the tenth
anniversary of the date the Option is granted or (b) one day less than three
months after the date of the Holder's termination of employment with the Company
and all Affiliates (other than by reason of the Holder's death) or (c) the date
that is one year after the date of the Holder's death. Unless the Holder's
Option Agreement specifies otherwise, an Option shall not continue to vest after
the severance of the employment relationship between the Company and all
Affiliates.
After the death of the Holder, the Holder's executors, administrators or any
person or persons to whom the Holder's Option may be transferred by will or by
the laws of descent and distribution, shall have the right, at any time prior to
the expiration of the Option to exercise the Option, in respect to the number of
shares that the Holder would have been entitled to exercise if the Holder
exercised the Option prior to the Holder's death.
AMOUNT EXERCISABLE. Each Option may be exercised at the time, in the manner and
subject to the conditions the Committee specifies in the Option Agreement in its
sole discretion.
EXERCISE OF OPTIONS. Each Option shall be exercised by the delivery of written
notice to the Committee setting forth the number of shares of Stock with respect
to which the Option is to be exercised, together with: (a) cash, certified
check, bank draft or postal or express money order payable to the order of the
Company for an amount equal to the exercise price under the Option, (b) Mature
Shares with a Fair Market Value on the date of exercise equal to the exercise
price under the Option, (c) an election to make a cashless exercise through a
registered broker-dealer (if approved in advance by the Committee or by an
executive officer of the Company) or (d) except as specified below, any other
form of payment which is acceptable to the Committee, and specifying the address
to which the certificates for the shares are to be mailed. As promptly as
practicable after receipt of written notification and payment, the Company shall
deliver to the Holder certificates for the number of shares with respect to
which the Option has been exercised, issued in the Holder's name. If Mature
Shares are used for payment by the Holder, the aggregate Fair Market Value of
the shares of Stock tendered must be equal to or less than the aggregate
exercise price of the shares being purchased upon exercise of the Option, and
any difference must be paid by cash, certified check, bank draft or postal or
express money order payable to the order of the Company. Delivery of the shares
shall be deemed effected for all purposes when a stock transfer agent of the
Company shall have deposited the certificates in the United States mail,
addressed to the Holder, at the address specified by the Holder.
Whenever an Option is exercised by exchanging Mature Shares owned by the Holder,
the Holder shall deliver to the Company certificates registered in the name of
the Holder representing a number of shares of Stock legally and beneficially
owned by the Holder, free of all liens, claims and encumbrances of every kind,
accompanied by stock powers duly endorsed in blank by the record holder of the
shares represented by the certificates (with signature guaranteed by a
commercial bank or trust company or by a brokerage firm having a membership on a
registered national stock exchange). The delivery of certificates upon the
exercise of Options is subject to the condition that the person exercising the
Option provide the Company with the information the Company might reasonably
request pertaining to exercise, sale or other disposition.
The Committee may permit a Holder to elect to pay the exercise price upon
exercise of an Option by authorizing a third-party broker to sell all or a
portion of the shares of Stock acquired upon exercise of the Option and remit to
the Company a sufficient portion of the sale proceeds to pay the exercise price
and any applicable tax withholding resulting from such exercise.
The Committee shall not permit a Holder to pay such Holder's exercise price upon
the exercise of an Option by having the Company reduce the number of shares of
Stock that will be delivered to the Holder pursuant to the exercise of the
Option. In addition, the Committee shall not permit a Holder to pay such
Holder's exercise price upon the exercise of an Option by using shares of Stock
other than Mature Shares.
An Option may not be exercised for a fraction of a share of Stock.
SUBSTITUTION OPTIONS. Options may be granted under the Plan from time to time in
substitution for stock options held by employees of other corporations who are
about to become employees of or affiliated with the Company or any Affiliate as
the result of a merger or consolidation of the employing corporation with the
Company or any Affiliate, or the acquisition by the Company or any Affiliate of
the assets of the employing corporation, or the acquisition by the Company or
any Affiliate of stock of the employing corporation as the result of which it
becomes an Affiliate of the Company. The terms and conditions of the substitute
Options granted may vary from the terms and conditions set out in the Plan to
the extent the Committee, at the time of grant, may deem appropriate to conform,
in whole or in part, to the provisions of the stock options in substitution for
which they are granted.
NO RIGHTS AS STOCKHOLDER. No Holder shall have any rights as a stockholder with
respect to Stock covered by such Holder's Option until the date a stock
certificate is issued for the Stock.
ADMINISTRATION
The Plan shall be administered by the Committee. All questions of interpretation
and application of the Plan and Options shall be subject to the determination of
the Committee. A majority of the members of the Committee shall constitute a
quorum. All determinations of the Committee shall be made by a majority of its
members. Any decision or determination reduced to writing and signed by a
majority of the members shall be as effective as if it had been made by a
majority vote at a meeting properly called and held. The Plan shall be
administered in such a manner as to permit the Options which are designated to
be Incentive Options to qualify as Incentive Options. In carrying out its
authority under the Plan, the Committee shall have full and final authority and
discretion, including but not limited to the following rights, powers and
authorities, to:
determine the persons to whom and the time or times at which Options will be
made;
determine the number of shares and the exercise price of Stock covered in each
Option, subject to the terms of the Plan;
determine the terms, provisions and conditions of each Option, which need not be
identical;
accelerate the time at which any outstanding Option may be exercised;
define the effect, if any, on an Option of the death, disability, retirement or
other termination of employment relationship between the Holder and the Company
and Affiliates;
prescribe, amend and rescind rules and regulations relating to administration of
the Plan; and make all other determinations and take all other actions deemed
necessary, appropriate or advisable for the proper administration of the Plan.
The actions of the Committee in exercising all of the rights, powers, and
authorities set out in this Article and all other Articles of the Plan, when
performed in good faith and in its sole judgment, shall be final, conclusive and
binding on all parties.
AMENDMENT OR TERMINATION OF PLAN
The Board may amend, terminate or suspend the Plan at any time, in its sole and
absolute discretion; provided, however, that to the extent required to maintain
the status of any Incentive Option under the Code, no amendment that would
change the aggregate number of shares of Stock which may be issued under
Incentive Options, or change the class of Employees eligible to receive
Incentive Options shall be made without the approval of the Company's
stockholders. Subject to the preceding sentence, the Board shall have the power
to make any changes in the Plan and in the regulations and administrative
provisions under it or in any outstanding Incentive Option as in the opinion of
counsel for the Company may be necessary or appropriate from time to time to
enable any Incentive Option granted under the Plan to continue to qualify as an
incentive stock option or such other stock option as may be defined under the
Code so as to receive preferential federal income tax treatment.
MISCELLANEOUS
NO ESTABLISHMENT OF A TRUST FUND. No property shall be set aside nor shall a
trust fund of any kind be established to secure the rights of any Holder under
the Plan. All Holders shall at all times rely solely upon the general credit of
the Company for the payment of any benefit which becomes payable under the Plan.
NO EMPLOYMENT OBLIGATION. The granting of any Option shall not constitute an
employment contract, express or implied, nor impose upon the Company or any
Affiliate any obligation to employ or continue to employ, or utilize the
services of, any Holder. The right of the Company or any Affiliate to terminate
the employment of any person shall not be diminished or affected by reason of
the fact that an Option has been granted to him.
FORFEITURE. Notwithstanding any other provisions of the Plan, if the Committee
finds by a majority vote after full consideration of the facts that the Holder,
before or after termination of such Holder's employment relationship with the
Company or an Affiliate for any reason committed or engaged in willful
misconduct, gross negligence, a breach of fiduciary duty, fraud, embezzlement,
theft, a felony, a crime involving moral turpitude or proven dishonesty in the
course of such Holder's employment by the Company or an Affiliate, the Holder
shall forfeit all outstanding Options, and all exercised Options if the Company
has not yet delivered a stock certificate to the Holder with respect thereto.
The decision of the Committee shall be final. No decision of the Committee,
however, shall affect the finality of the discharge of the Holder by the Company
or an Affiliate in any manner.
TAX WITHHOLDING. The Company or any Affiliate shall be entitled to deduct from
other compensation payable to each Holder any sums required by federal, state or
local tax law to be withheld with respect to the grant or exercise of an Option.
In the alternative, the Company may require the Holder of an Option to pay such
sums for taxes directly to the Company or any Affiliate in cash or by check
within ten days after the date of exercise or lapse of restrictions. In the
discretion of the Committee, and with the consent of the Holder, the Company may
reduce the number of shares of Stock issued to the Holder upon such Holder's
exercise of an Option to satisfy the tax withholding obligations of the Company
or an Affiliate; provided that the Fair Market Value of the shares held back
shall not exceed the Company's or the Affiliate's minimum statutory withholding
tax obligations. The Company shall have no obligation upon exercise of any
Option until the Company or an Affiliate has received payment sufficient to
cover all tax withholding amounts due with respect to that exercise. Neither the
Company nor any Affiliate shall be obligated to advise a Holder of the existence
of the tax or the amount which it will be required to withhold.
WRITTEN AGREEMENT. Each Option shall be embodied in a written agreement which
shall be subject to the terms and conditions of the Plan and shall be signed by
the Holder and by a member of the Committee on behalf of the Committee and the
Company or an executive officer of the Company, other than the Holder, on behalf
of the Company. The agreement may contain any other provisions that the
Committee in its discretion shall deem advisable which are not inconsistent with
the terms of the Plan.
INDEMNIFICATION OF THE COMMITTEE. The Company shall indemnify each present and
future member of the Committee against, and each member of the Committee shall
be entitled without further action his or her part to indemnity from the Company
for, all expenses (including attorney's fees, the amount of judgments and the
amount of approved settlements made with a view to the curtailment of costs of
litigation, other than amounts paid to the Company itself) reasonably incurred
by such member in connection with or arising out of any action, suit or
proceeding in which such member may be involved by reason of such member being
or having been a member of the Committee, whether or not he or she continues to
be a member of the Committee at the time of incurring the expenses, including,
without limitation, matters as to which such member shall be finally adjudged in
any action, suit or proceeding to have been negligent in the performance of such
member's duty as a member of the Committee. However, this indemnity shall not
include any expenses incurred by any member of the Committee in respect of
matters as to which such member shall be finally adjudged in any action, suit or
proceeding to have been guilty of gross negligence or willful misconduct in the
performance of his duty as a member of the Committee. In addition, no right of
indemnification under the Plan shall be available to or enforceable by any
member of the Committee unless, within 60 days after institution of any action,
suit or proceeding, such member shall have offered the Company, in writing, the
opportunity to handle and defend same at its own expense. This right of
indemnification shall inure to the benefit of the heirs, executors or
administrators of each member of the Committee and shall be in addition to all
other rights to which a member of the Committee may be entitled as a matter of
law, contract or otherwise.
GENDER. If the context requires, words of one gender when used in the Plan shall
include the other and words used in the singular or plural shall include the
other.
HEADINGS. Headings of Articles and Sections are included for convenience of
reference only and do not constitute part of the Plan and shall not be used in
construing the terms of the Plan.
OTHER COMPENSATION PLANS. The adoption of the Plan shall not affect any other
stock option, incentive or other compensation or benefit plans in effect for the
Company or any Affiliate, nor shall the Plan preclude the Company from
establishing any other forms of incentive compensation arrangements for
Employees.
OTHER OPTIONS. The grant of an Option shall not confer upon the Holder the right
to receive any future or other Options under the Plan, whether or not Options
may be granted to similarly situated Holders, or the right to receive future
Options upon the same terms or conditions as previously granted.
GOVERNING LAW. The provisions of the Plan shall be construed, administered and
governed under the laws of the State of Delaware.