1
EXHIBIT 99.6
ADMINISTAFF, INC.
NONQUALIFIED STOCK OPTION PLAN
Administaff, Inc., a Delaware corporation (the "Company"), hereby
adopts the Administaff, Inc. Nonqualified Stock Option Plan (the "Plan")
effective as of July 27, 1999. The terms and provisions of the Plan are set
forth below.
1. Purpose. The purpose of the Plan is to promote the interests
of the Company by encouraging employees of the Company and its Subsidiaries who
are not officers of the Company to acquire or increase their equity interests in
the Company and to provide a means whereby such persons may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company, thereby advancing the interests of the
Company and its stockholders. The Plan is also contemplated to enhance the
ability of the Company and its Subsidiaries to attract and retain the services
of individuals who are believed to be essential for the continued growth and
profitability of the Company.
2. Definitions. As used in this Plan:
(a) "Board" means the Board of Directors of the Company.
(b) "CEO" means the Chief Executive Officer of the
Company.
(c) "Change in Control" shall be deemed to have occurred
upon:
(i) the date of the acquisition by any "person"
(within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934 ("Exchange Act")), excluding
the Company or any of its Subsidiaries, of beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange
Act) of 30% or more of either the then outstanding shares of
common stock of the Company, or the then outstanding voting
securities entitled to vote generally in the election of
directors; or
(ii) the date the individuals who constitute the
Board as of May 28, 1997 (the "Incumbent Board"), cease for
any reason to constitute at least a majority of the members of
the Board, provided that any person becoming a director
subsequent to May 28, 1997 whose election, or nomination for
election by the Company's stockholders, was approved by a vote
of at least a majority of
2
the directors then comprising the Incumbent Board (other than
any individual whose nomination for election to Board
membership was not endorsed by the Company's management prior
to, or at the time of, such individual's initial nomination
for election) shall be, for purposes of this Plan, considered
as though such person were a member of the Incumbent Board;
(iii) the date of consummation of a merger,
consolidation, recapitalization, reorganization, sale or
disposition of all or a substantial portion of the Company's
assets, or the issuance of shares of stock of the Company in
connection with the acquisition of the stock or assets of
another entity, provided, however, that a Change in Control
shall not occur under this clause (iii) if consummation of the
transaction would result in at least 65% of the total voting
power represented by the voting securities of the Company (or,
if not the Company, the entity that succeeds to all or
substantially all of the Company's business) outstanding
immediately after such transaction being beneficially owned
(within the meaning of Rule 13d-3 promulgated pursuant to the
Exchange Act) by at least 65% of the holders of outstanding
voting securities of the Company immediately prior to the
transaction, with the voting power of each such continuing
holder relative to other such continuing holders not
substantially altered in the transaction; or
(iv) the date the Company files a report or proxy
statement with the Securities and Exchange Commission pursuant
to the Exchange Act disclosing in response to Form 8-K or
Schedule 14A (or any successor schedule, form or report or
item therein) that a change in control of the Company has or
may have occurred or will or may occur in the future pursuant
to any then-existing contract or transaction.
(d) "Committee" means the Compensation Committee of the
Board of Directors of the Company
(e) "Common Stock" means the Common Stock, $0.01 par
value, of the Company or any security into which such Common Stock may
be changed by reason of any transaction or event of the type described
in Paragraph 6.
(f) "Date of Grant" means the date specified by the CEO
on which an Option Right will become effective, which date will not be
earlier than the date on which the CEO takes action with respect
thereto.
-2-
3
(g) "Employee" means an employee of the Company or
Subsidiary who is not an officer of the Company, and any person who has
been offered employment by the Company or a Subsidiary (other than as
an officer of the Company), provided that any Option Right granted to
such prospective employee shall be canceled if such person fails to
commence such employment, and no such Option Right shall be exercisable
before such person has commenced such employment.
(h) "Market Value per Share" means, at any date, the
closing sale price per share of the Common Stock on that date (or, if
there are no sales on that date, the last preceding date on which there
was a sale) in the principal market in which the Common Stock is
traded.
(i) "Option Price" means the purchase price per share
payable on exercise of an Option Right.
(j) "Option Right" means the right to purchase a share of
Common Stock upon exercise of an option granted pursuant to Paragraph
4.
(k) "Participant" means an Employee who is selected by
the CEO to receive an Option Right.
(l) "subsidiary" means, at any time, any corporation or
other entity in which at the time the Company then owns or controls,
directly or indirectly, not less than 50% of the total combined voting
power represented by all classes of equity interests issued by such
corporation or entity.
3. Shares Available Under Plan. Subject to adjustments as
provided in Paragraph 6, the maximum number of shares of Common Stock with
respect to Option Rights may be granted in any calendar year under this Plan is
SIX HUNDRED THOUSAND (600,000); however, any shares of Common Stock which are
subject to Option Rights that are terminated unexercised, forfeited or
surrendered or which expire for any reason during that same calendar year in
which such Option Rights were granted will again be available for issuance that
calendar year. Such shares may be shares of original issuance or treasury shares
or a combination of the foregoing.
4. Option Rights. The CEO may from time to time make grants to
any Employee of options to purchase shares of Common Stock upon such terms and
conditions as the CEO may determine, to the extent not inconsistent with the
following provisions:
(a) Each grant will specify the number of shares of
Common Stock to which it pertains.
-3-
4
(b) Each grant will specify its Option Price, which may
not be less than 100% of the Market Value per Share on the Date of
Grant.
(c) Each grant will specify that the Option Price will be
payable (i) in cash or by check payable and acceptable to the Company
or (ii) to the extent provided for in the option agreement, (a) by
tendering to the Company shares of Common Stock owned by the optionee
for at least six months, if acquired pursuant to a Company stock
option, and having an aggregate Market Value Per Share as of the date
of exercise and tender that is not greater than the full Option Price
for the shares with respect to which the Option is being exercised and
by paying any remaining amount of the Option Price as provided in (i)
above (provided that the CEO may, upon confirming that the optionee
owns the number of shares being tendered, authorize the issuance of a
new certificate for the number of shares being acquired pursuant to the
exercise of the option less the number of shares being tendered upon
the exercise and return to the optionee (or not require surrender of)
the certificate for the shares being tendered upon the exercise) or (b)
by the optionee delivering to the Company a properly executed exercise
notice together with irrevocable instructions to a broker to promptly
deliver to the Company cash or a check payable and acceptable to the
Company to pay the Option Price and any required tax withholding
amounts; provided that in the event the optionee chooses to pay the
Option Price and withholding taxes as provided in (ii)(b) above, the
optionee and the broker shall comply with such procedures and enter
into such agreements as the CEO may prescribe as a condition of such
payment procedure, or (iii) by a combination of such payment methods.
Payment instruments will be received subject to collection.
(d) Successive grants may be made to the same Participant
whether or not any Option Rights previously granted to such Participant
remain unexercised.
(e) Each grant will specify the required period or
periods of continuous service by the Participant with the Company and
the Subsidiaries and any performance objectives to be achieved, as
established by the CEO, before the Option Rights or installments
thereof will become exercisable, and any grant may provide, in the
CEO's discretion, for the earlier vesting of the Option Rights upon
termination of the Participant's employment due to death, disability or
retirement. In addition, the CEO may, in his discretion, accelerate the
vesting, in whole or in part, of all or any outstanding Options of one
or more, including all, Participants. Any such action taken by the CEO
need not be uniform as to Participants.
-4-
5
(f) Each grant the exercise of which, or the timing of
the exercise of which, is dependent, in whole or in part, on the
achievement of performance objectives or other criteria may specify a
minimum level of achievement in respect of the specified performance
objectives or other criteria below which no Option Rights will be
exercisable and may set forth a formula or other method for determining
the number of Option Rights that will be exercisable if performance is
at or above such minimum but short of full achievement of the
performance objectives.
(g) Option Rights granted under this Plan shall be
options which are not intended to qualify as incentive stock options
under Section 422 of the Internal Revenue Code of 1986, as amended.
(h) Each grant shall specify the period during which the
Option Right may be exercised, but no Option Right will be exercisable
more than ten years from the Date of Grant.
(i) Each grant of Option Rights will be evidenced by an
agreement executed on behalf of the Company by any authorized officer
and delivered to the Participant and containing such terms and
provisions consistent with this Plan, as the CEO may approve.
(j) Notwithstanding anything contained in the Plan to the
contrary, all Option Rights shall immediately become exercisable in
full upon a Change in Control.
5. Transferability. No Option Right (or any interest
therein) will be transferable by a Participant other than by (i) will or the
laws of descent and distribution or (ii) a qualified domestic relations order
and an Option Right will be exercisable during the Participant's lifetime only
by the Participant or by the Participant's guardian or legal representative.
6. Adjustments. The Committee may make or provide for
such adjustments in the maximum number of shares of Common Stock specified in
Paragraph 3, in the numbers of shares of Common Stock covered by outstanding
Option Rights granted hereunder, in the Option Price applicable to any such
Option Rights, and/or in the kind of shares covered thereby (including shares of
another issuer), as the Committee, in its sole discretion exercised in good
faith, may determine is equitably required to prevent dilution or enlargement of
the rights of Participants that otherwise would result from any stock dividend,
stock split, combination of shares, recapitalization or other change in the
capital structure of the Company, merger, consolidation, reorganization, partial
or complete liquidation, issuance of rights or warrants to purchase securities
or any other corporation transaction or event having an effect similar to any of
the foregoing.
-5-
6
7. Fractional Shares. The Company will not be required to issue
any fractional share of Common Stock pursuant to this Plan. The CEO may provide
for the elimination of fractions for the settlement of fractions in cash.
8. Withholding of Taxes. To the extent that the Company is
required to withhold federal, state, local or foreign taxes in connection with
any grant to or exercise by a Participant or any other person under this Plan,
it will be a condition to the receipt of such grant or exercise that the
Participant or such other person make arrangements satisfactory to the Company
for the payment of such taxes required to be withheld. The CEO may provide in
any grant agreement that such taxes may be satisfied by the relinquishment of a
portion of such Award or payment.
9. Administration of the Plan. (a) This Plan will be administered
by the CEO, who may delegate ministerial matters to such person or persons as
the CEO may choose.
(b) The interpretation and construction by the CEO of any
provision of this Plan or of any agreement, notification or document evidencing
the grant of an Option Right and any determination by the CEO pursuant to any
provision of this Plan or of any such agreement, notification or documentation
will be final and conclusive. The CEO will not be liable for any such action or
determination made in good faith or in the absence of gross negligence or
willful misconduct on the part of the CEO.
10. Amendments. The Committee may amend or terminate the Plan or
the CEO's authority to grant Option Rights under the Plan without the consent of
stockholders or Participants; provided, however, the Committee may, in its
discretion, determine to submit any changes to the Board for approval. Upon
submission to the Board, the Board may, in its discretion, determine to submit
any changes to stockholders for approval; and provided, further, no such action
by either the Committee or the Board may be taken which would materially impair
the rights of a Participant under any Option Right theretofore granted to him
without the consent of the Participant.
11. No Employment Rights. This Plan will not confer upon any
Participant any right with respect to continuance of employment or other service
with the Company or any Subsidiary, nor will it interfere in any way with any
right the Company or any Subsidiary would otherwise have to terminate such
Participant's employment or other service at any time.
12. Effective Date. The Plan shall be effective upon its approval
by the Committee.
-6-