EXHIBIT 10.44
CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD.
UNAPPROVED SHARE OPTION SCHEME
ADOPTED BY THE BOARD OF CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD. ON 23
JANUARY 1998
KPMG Tax Advisers
1 PUDDLE DOCK
LONDON
EC4V 3PD
REF: CAS2.DOC2
DATE: 23 JANUARY 1998
RULES OF THE CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD. UNAPPROVED SHARE
OPTION SCHEME
INDEX
Page
1 Definitions..................................................... 3
2 Grant of Options................................................ 7
3 Exercise of Options............................................. 8
4 Take-overs, Reconstructions, Liquidations and Option Exchanges.. 10
5 Variation of Share Capital...................................... 12
6 Manner of Exercise of Options................................... 13
7 Administration and Amendment.................................... 14
8 Loss of Office or Employment.................................... 15
Appendix 1 Letter of Grant
Appendix 2 Option Certificate and Notice of Exercise
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RULES OF THE CASTLE TRANSMISSION SERVICES (HOLDINGS) LTD. UNAPPROVED SHARE
OPTION SCHEME
1 DEFINITIONS
1.1 In these Rules the following words and expressions shall have, where the
context so admits, the following meanings:
"Act" - the Income and Corporation Taxes Act 1988;
"Adoption Date" - the date on which the Scheme is adopted by the Board;
"Auditors" - the auditors for the time being of the Company (acting as experts and not as arbitrators);
"Board" - the board of directors of the Company or the Committee at which a quorum is present;
"Committee" - a duly constituted committee of the Board;
"Company" - Castle Transmission Services (Holdings) Ltd. registered in England No 3242381 or save for Rules 2 and 7.2
such company as shall be at any time the Acquiring Company as defined in Rule 4.5;
"Control" - as described in section 416 or section 840 of the Act;
"Date of Grant" - the date on which an Option is, was or is to be granted to an Eligible Employee under the Scheme, pursuant
to Rule 2.1, or on which an Option is or was treated as being granted pursuant to Rule 2.3;
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"Eligibility Date" - 1st March 1997 or, if the Option Holder was not an Eligible Employee on that date, the Date of
Grant;
"Eligible Employee" - any director or employee of any Group Company;
"Exercise Conditions" - any conditions imposed pursuant to Rule 2.2;
"Exercise Price" - the price as determined by the Board at which an Eligible Employee may acquire a Unit on the
exercise of an Option being, subject to Rule 2.3 and Rule 5, not less than the aggregate nominal
value of the underlying shares;
"Group" - the Company and its Subsidiaries and the phrase "Group Company" shall be construed accordingly;
"Letter of Grant" - the letter in the form set out in Appendix I or in such form as the Board may determine from time to
time;
"Merger" - the acquisition of Control of the Company by Castle Tower Holding Corporation (a Delaware
corporation) or a company under the Control of or having Control of that company;
"New Option" - an option over shares in the Acquiring Company (as defined in Rule 4.5) granted in consideration of
the release of a Subsisting Option;
"Notice of Exercise" - the notice of exercise in the form set out in Appendix II or in such form as the Board may
determine from time to time;
"Option" - a right to acquire Units granted or to be granted pursuant to Rules 2.1 or 2.3;
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"Option Certificate" - the option certificate in the form set out in Appendix II or in such form as the Board may
determine from time to time;
"Option Holder" - a person who has been granted an Option or (where the context admits) his legal personal
representative(s);
"Recognised Exchange" - a recognised stock exchange within the meaning of section 841 of the Act or a recognised investment
exchange within the meaning of the Financial Services Act 1986;
"Rules" - the rules of the Scheme as the same may be amended from time to time;
"this Scheme" - this Castle Transmission Services (Holdings) Ltd. Unapproved Share Option Scheme constituted and
governed by the Rules;
"Subsidiary" - a company which is under the Control of the Company and is a subsidiary of the Company within the
meaning of section 736 of the Companies Act 1985;
"Subsisting Option" - an Option which has been granted and which has not lapsed, been surrendered, renounced or exercised
in full;
"Unit" - subject to Rule 5.1, a stapled shareholding comprising one ordinary share of 1p and nine hundred and
ninety-nine redeemable preference shares of 1p each in the capital of the Company or, where a New
Option has been granted or is to be granted pursuant to Rule 2.3, a share in the capital of the
Acquiring Company;
1.2 In these Rules, except insofar as the context otherwise requires:
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(i) words denoting the singular shall include the plural and vice versa;
(ii) words importing a gender shall include every gender and references
to a person shall include bodies corporate and unincorporated and
vice versa;
(iii) reference to any enactment shall be construed as a reference to that
enactment as from time to time amended, modified, extended or re-
enacted and shall include any orders, regulations, instruments or
other sub-ordinate legislation made under the relevant enactment;
and
(iv) headings and captions are provided for reference only and shall not
be considered as part of the Scheme.
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2. GRANT OF OPTIONS
2.1 The Board may select any number of individuals who shall at the intended
Date of Grant be Eligible Employees and grant them Options at any time or
times after the Adoption Date but not later than the tenth anniversary of
the Adoption Date.
2.2 In granting an Option pursuant to Rule 2.1 the Board may impose any
objective condition and/or limitation upon the exercise of such Option
whether such condition and/or limitation is imposed when the Option is
granted or subsequent to the grant. Any condition and/or limitation
imposed or to be imposed and the timeframe within which a condition can be
imposed subsequent to grant shall be:
(i) set out in the Option Certificate or in a schedule referred
to in the Option Certificate; and
(ii) such that rights to exercise such Option after the fulfilment or
attainment of any conditions and/or limitations so specified or to be
specified shall not be subsequently dependent upon the further
discretion of any person.
2.3 Where the circumstances noted in Rule 4.5 apply New Options may be granted
in consideration for the release of Options previously granted under this
Scheme. Such New Options are deemed to be equivalent to the old Options
and to have been granted within the terms of this Scheme.
2.4 No Option may be transferred, assigned or charged and any purported
transfer, assignment or charge shall be void ab initio. Each Option
Certificate shall carry a statement to this effect. For the avoidance of
doubt, this Rule 2.4 shall not prevent the Option of a deceased Option
Holder being exercised by his personal representative(s) within the terms
of these Rules.
2.5 Options shall be granted by deed and shall be evidenced by the issue of a
Letter of Grant to Eligible Employees specifying the Date of Grant, the
number of Units subject to Option, the Exercise Price and any Exercise
Conditions. The Option Certificate shall be sent to the Option Holder
together with a Letter of Grant as soon as practicable after the Date of
Grant.
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3. EXERCISE OF OPTIONS
3.1 Subject to each of the rules of this Rule 3 and Rule 6 below any Subsisting
Option may be exercised by the Option Holder or, if deceased, by his
personal representatives in whole or in part at the time of or at any time
following the occurrence of the earliest of the following events:
(i) the third anniversary of the Eligibility Date;
(ii) the death of the Option Holder on or after 28th February 1998;
(iii) upon the Option Holder ceasing to be a director or employee of the
Group on or after 28th February 1998 other than by reason of the
Option Holder (having been at the date of such cessation a director
or employee of the Group for a continuous period of less than five
years since 28 February 1997 and the Board not making a resolution
in accordance with 5.7(b) of the Company's articles of association
on the date of such cessation) giving notice to the Company or any
of its subsidiaries of his intention to terminate his employment or
the termination of the Option Holder's employment with the Company
or any of its subsidiaries in circumstances involving a repudiatory
breach by the Option Holder of his employment contract or in
circumstances which would entitle the Company or, as the case may
be, any subsidiary summarily to terminate his employment without
notice;
(iv) an opportunity to exercise the Option pursuant to Rule 4;
(v) upon the Option Holder ceasing to be a director or employee of the
Group on or after 28th February 1998 where that cessation was by
reason either of the company or companies of which he was employed
ceasing to be a Group Company or of the office of employment
relating to a business or part of a business which is transferred to
a person who is not a Group Company;
3.2 An Option may only be exercised if the Exercise Conditions have been
satisfied unless the Board decide otherwise.
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3.3 The Board may in exceptional circumstances not otherwise provided for in
these Rules invite all Option Holders to exercise their Options at any time
following the Date of Grant. Where exercise is thereby permitted, it shall
take place to such extent and within such period as the Board shall specify
but in exercising this discretion the Board will not discriminate between
individual Option Holders.
3.4 An Option shall lapse and become thereafter incapable of exercise on the
earliest of the following events:
(i) the seventh anniversary of the Date of Grant or such earlier date
specified by the Board at the Date of Grant;
(ii) immediately upon the Board notifying the Option Holder that the
Exercise Condition has not been satisfied unless at that same time
the Board notify the Option Holder that the circumstances are such
that the Board consider the Option should remain exercisable;
(iii) the first anniversary of an Option Holder's death where death occurs
on or after 28th February 1998;
(iv) six months after an Option is first exercisable pursuant to Rule 3.1
(iii) and (v);
(v) immediately upon the Option Holder ceasing to be a director or
employee of the Group in circumstances where the Option is not
exercisable pursuant to Rule 3.1 (ii), (iii) or (v);
(vi) the end of the period of exercisability determined in accordance
with Rule 4;
(vii) where the Option Holder is offered a New Option in consideration for
the release of an Option pursuant to Rule 4.5 at the end of the
period in which that company's offer may be accepted;
(viii) the Option Holder being adjudicated bankrupt;
(ix) the surrender of the Option by the Option Holder.
4. TAKE-OVERS, RECONSTRUCTIONS, LIQUIDATIONS AND OPTION EXCHANGES
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4.1 If in circumstances other than a Merger any person not being a company
under the same Control as the Company obtains Control of the Company as a
result of making a general offer to acquire the whole of the issued share
capital of the Company (other than that which is already owned by him)
which is unconditional or which is made on a condition such that if it is
satisfied the person making the offer will have Control of the Company then
the Board shall notify all Option Holders as soon as is practicable of the
offer in accordance with Rule 7.4. Any Subsisting Option may be exercised
from the date of the receipt of that notification up to the expiry of a
period ending six months from the time when the person making the offer has
obtained Control of the Company and any condition subject to which the
offer is made has been satisfied.
4.2 If in circumstances other than a Merger any person not being a company
under the same Control as the Company obtains Control of the Company other
than as a result of the events specified in Rule 4.1 then the Board shall
notify all Option Holders as soon as practicable after the change of
Control in accordance with Rule 7.4. Any Subsisting Option may be
exercised from the date of the receipt of that notification up to the
expiry of a period ending six months from the time when the person obtains
Control of the Company.
4.3 If in circumstances other than a Merger under Section 425 of the Companies
Act 1985 the Court sanctions a compromise or arrangement which affects the
shares comprised within Units any Subsisting Option may be exercised within
six months of the Court sanctioning such compromise or arrangement.
4.4 If in circumstances other than a Merger any person becomes bound or
entitled to acquire shares in the Company under sections 428 to 430 of the
Companies Act 1985 any Subsisting Option may be exercised at any time when
that person remains so bound or entitled.
4.5 If as a result of the occurrence of one or more of the events specified in
Rules 4.1, 4.2, 4.3 or 4.4 or as a result of a Merger a company whether or
not under the same Control as the Company has obtained Control of the
Company the Option Holder may, if the other company (the Acquiring Company)
so agrees, release any Subsisting Option he holds in consideration for the
grant of a New Option.
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A New Option issued in consideration of the release of an Option shall be
evidenced by an Option Certificate which shall import the relevant
provisions of these Rules.
A New Option shall, for all other purposes of this Scheme, be treated as
having been acquired at the same time as the corresponding released Option.
4.6 If notice is duly given of a general meeting at which a resolution will be
proposed for the voluntary winding-up of the Company, an Option shall be
exercisable in whole or in part (but so that any exercise hereunder shall
be conditional upon such resolution being passed) at any time thereafter
until the resolution is duly passed or defeated or the general meeting is
concluded or adjourned, whichever shall first occur. If such resolution is
passed an Option shall to the extent unexercised thereupon lapse.
4.7 The periods of exercisability under Rule 3.1(iv) and the date of lapse
under Rule 3.4(vi) and (vii) are those of whichever of the pre-conditions
of Rules 4.1, 4.2, 4.3, 4.4, or 4.5 are first achieved. The subsequent
achievement of any other pre-conditions will not cause a period of
exercisability to begin nor a date of lapse to arise.
4.8 For the purpose of this Rule 4 a person shall be deemed to have obtained
Control of a Company if he and others acting in concert with him have
together obtained Control of it.
4.9 The exercise of an Option pursuant to the preceding provisions of this Rule
4 shall be subject to the provisions of Rule 6.
4.10 A New Option shall not be exercisable by virtue of the event pursuant to
which it was granted.
5. VARIATION OF SHARE CAPITAL
5.1 In the event of any variation of the share capital of the Company,
including, but without prejudice to the generality of the preceding words,
any capitalisation or rights issue or any consolidation, sub-division,
redemption or reduction of capital the definition of Unit and hence the
class of shares comprised within an Option, the number of Units or shares
subject to any Option and the Exercise Price may be adjusted by the Board
in such manner as the Auditors confirm in writing to be, in their
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opinion, fair and reasonable provided that the Exercise Price for each Unit
subject to an Option is not reduced below the nominal value of the
underlying shares unless (and to the extent that) the Company is authorised
to capitalise from its undistributed profits or reserves upon the exercise
of such Option an amount equal to the difference between the aggregate
Exercise Price and the aggregate nominal value of the underlying shares to
be issued upon such exercise and to apply such sum in paying up the
difference;
Such variation shall be deemed to be effective, from the record date at
which the respective variation applied to other shares of the same class as
the shares comprised within the Units. Any Options exercised within that
period shall be treated as exercised with the benefit of the variation
confirmed by the Auditors.
5.2 The Board shall take such steps as it considers necessary to notify Option
Holders of any adjustment made under Rule 5.1 and may call in, cancel,
endorse, issue or reissue any Option Certificate consequent upon such
adjustment.
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6. MANNER OF EXERCISE OF OPTIONS
6.1 Subject to Rule 6.6 an Option shall be exercised in whole or in part by the
Option Holder or, as the case may be, his personal representatives giving
notice in writing to the Board by the appropriate Notice of Exercise
detailing the number of Units in respect of which he wishes to exercise the
Option accompanied by the appropriate payment and the relevant Option
Certificate and shall be effective on the date of its receipt by the Board.
6.2 Subject to Rule 6.6 where an Option is exercised, the number of shares
comprised within the Units specified in the Notice of Exercise given in
accordance with Rule 6.1 shall be allotted and issued credited as fully
paid to the Option Holder within 30 days of the date of exercise and the
Company shall arrange for the delivery of evidence of title in respect
thereof. Save for any rights determined by reference to a record date
preceding the date of allotment, such shares shall rank pari passu with the
other shares of the same class then in issue.
6.3 When an Option is exercised in part, the balance shall remain exercisable
on the same terms as originally applied to the Option and a new Option
Certificate in respect of the balance shall be issued by the Company as
soon as possible after the partial exercise.
6.4 Where shares comprised within a Unit in respect of which an Option has been
granted are or become listed on any Recognised Exchange, the Company shall
apply for shares in respect of which an Option has been exercised to be so
listed, if they were not so listed already.
6.5 Where shares comprised within a Unit are listed on any Recognised Exchange
then no Option may be exercised in contravention of the terms of such
securities transactions rules of the Recognised Exchange as may from time
to time be in force.
6.6 If an Option is exercised and the Option Holder is liable to tax, duties or
other amounts on such exercise and his employer or former employer being a
Group Company is liable to make a payment to the appropriate authorities on
account of that liability the Option Holder shall make a payment to his
employer or former employer equal to the amount which the employer or
former employer is required to pay to the appropriate authorities. No
shares comprised within a Unit shall be allotted to the Option Holder until
the employer has received payment from the Option Holder. This Rule 6.6
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shall not apply if the Option Holder makes alternative arrangements to the
satisfaction of his employer or former employer and the Company is informed
by the employer or former employer that the arrangements are satisfactory.
7. ADMINISTRATION AND AMENDMENT
7.1 The Scheme shall be administered by the Board whose decision on all
disputes shall be final save where the Rules require the concurrence of the
Auditors.
7.2 The Board may from time to time amend these Rules provided that no
amendment may materially affect an Option Holder as regards an Option
granted prior to the amendment being made.
7.3 The cost of establishing and operating the Scheme shall be borne by the
Group Companies in such proportions as the Board shall determine.
7.4 Any notice or other communication under or in connection with the Scheme
may be given by the Board either personally or by post, and to the Board
either personally or by post to the Secretary of the Board; items sent by
post shall be pre-paid and shall be deemed to have been received 72 hours
after posting.
7.5 The Company shall at all times keep available sufficient authorised and
unissued shares to satisfy the exercise to the full extent of all
Subsisting Options, taking account of any other obligations of the Company
to issue unissued shares of the same class as are comprised within Units.
8. LOSS OF OFFICE OR EMPLOYMENT
The rights and obligations of any individual under the terms of his office or
employment with any Group Company shall not be affected by his participation in
the Scheme or any right which he may have to participate therein, and an
individual who participates therein shall waive any and all rights to
compensation or damages in consequence of the termination of his office or
employment for any reason whatsoever insofar as those rights arise or may arise
from his ceasing to have rights under or be entitled to exercise any Option
under the Scheme as a result of such termination.
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