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EXHIBIT 10.8
NEXTEL COMMUNICATIONS, INC.
AMENDED AND RESTATED INCENTIVE EQUITY PLAN
(AS AMENDED AND RESTATED AS OF NOVEMBER 16, 2000)
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NEXTEL COMMUNICATIONS, INC.
AMENDED AND RESTATED INCENTIVE EQUITY PLAN
(AS AMENDED AND RESTATED AS OF NOVEMBER 16, 2000)
1. PURPOSE. The purpose of this Plan is to attract and retain
directors and officers and other key employees of and consultants to Nextel
Communications, Inc. (the "Corporation") and its Subsidiaries and to provide
such persons with incentives and rewards for superior performance.
2. DEFINITIONS. (a) As used in this Plan,
"ACCELERATED VESTING PERIOD" means the period beginning on the effective
date of a Change of Control and ending on the first anniversary of such
effective date.
"ACCELERATED VESTING PROVISION" means an Option Rights agreement provision
pursuant to Section 4(g)(ii) of this Plan, a Deferred Shares agreement
provision pursuant to Section 7(c)(ii) of this Plan or a Performance Shares
or Performance Units agreement provision pursuant to Section 8(b)(ii) of this
Plan.
"APPRECIATION RIGHT" means a right granted pursuant to Section 5 of this
Plan, including a Free-Standing Appreciation Right and a Tandem Appreciation
Right.
"BASE PRICE" means the price to be used as the basis for determining the
Spread upon the exercise of a Free-Standing Appreciation Right.
"BOARD" means the Board of Directors of the Corporation and, to the extent
of any delegation by the Board to a committee of the Board (or a subcommittee
thereof) pursuant to Section 16(a) of this Plan, such committee (or
subcommittee).
"CAUSE" means (i) the conviction of a felony involving an intentional act
of fraud, embezzlement or theft in connection with one's duties or otherwise
in the course of one's employment with an Employer, (ii) the intentional and
wrongful damaging of property, contractual interests or business
relationships of an Employer, (iii) the intentional and wrongful disclosure
of secret processes or confidential information of an Employer in violation
of an agreement with or a policy of an Employer, or (iv) intentional conduct
contrary to an Employer's announced policies or practices (including those
contained in the Corporation's Employee Handbook) where either:
(1) the nature and/or severity of the conduct or its
consequences typically would have resulted in immediate termination
based on the Corporation's established employee termination or
disciplinary practices in place on the Reference Date; or
(2) the employee has been provided with written notice
detailing the relevant policy or practice and the nature of the
objectionable conduct or other violation, and within 20 business
days of the receipt of such notice the employee has not remedied the
violation or ceased to engage in the objectionable conduct.
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"CHANGE OF CONTROL" means the occurrence of any of the following
events:
(i) the Corporation is merged or consolidated or reorganized
into or with another company or other legal entity, and as a result
of such merger, consolidation or reorganization less than a
majority of the combined voting power of the then-outstanding
securities of such resulting company or entity immediately after
such transaction is held directly or indirectly in the aggregate by
the holders of voting securities of the Corporation immediately
prior to such transaction, including voting securities issuable upon
the exercise or conversion of options, warrants or other securities
or rights;
(ii) the Corporation sells or otherwise transfers all or
substantially all of its assets to another company or other legal
entity, and as a result of such sale or other transfer of assets,
less than a majority of the combined voting power or the then
outstanding securities of such company or other entity immediately
after such sale or transfer is held directly or indirectly in the
aggregate by the holders of voting securities of the Corporation
immediately prior to such sale or transfer, including voting
securities issuable upon exercise or conversion of options,
warrants or other securities or rights;
(iii) a report is filed on Schedule 13D or Schedule 14D-1
(or any successor schedule, form or report), each as promulgated
pursuant to the Securities Exchange Act of 1934, as amended ( the
"Exchange Act"), disclosing that any "person" (as that term is used
in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act) has
become the "beneficial owner" (as that term is used in Rule 13d-3
promulgated under the Exchange Act) of securities representing 50%
or more of the voting securities of the Corporation (or any
successor thereto by operation of law or by reason of the
acquisition of all or substantially all of the assets of the
Corporation), including voting securities issuable upon the
exercise of options, warrants or other securities or rights; or
(iv) the Corporation (or any successor thereto by operation
of law or by acquisition of all or substantially all of the assets
of the Corporation) files a report or proxy statement pursuant to
the Exchange Act disclosing in response to Form 8-K or Schedule 14A
(or any successor schedule, form, report or item therein) that a
change in control of the Corporation (or such successor) has
occurred;
provided, however, notwithstanding the provisions of (iii) and (iv) above,
a "Change of Control" shall not be deemed to have occurred solely because
(1) the Corporation, (2) an entity in which the Corporation directly or
indirectly beneficially owns 50% or more of the voting securities or (3)
any Corporation-sponsored employee stock ownership plan or other employee
benefit plan of the Corporation, either files or becomes obligated to file
a report or proxy statement under or in response to Schedule 13D, Schedule
14D-1, Form 8-K or Schedule 14A (or any successor form, report, schedule or
item therein) under the Exchange Act, disclosing beneficial ownership by it
of voting securities, whether in excess of 50% or otherwise, or because the
Corporation reports that a change of control
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of the Corporation has or may have occurred or will or may occur in the
future by reason of such beneficial ownership.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time.
"COMMISSION" means the United States Securities and Exchange Commission.
"COMMON SHARES" means (i) shares of the Class A Common Stock, par value
$.001 per share, of the Corporation and (ii) any security into which Common
Shares may be converted by reason of any transaction or event of the type
referred to in Section 10 of this Plan.
"DATE OF GRANT" means the date specified by the Board on which a grant of
Option Rights, Appreciation Rights or Performance Shares or Performance Units
or a grant or sale of Restricted Shares or Deferred Shares shall become
effective, which shall not be earlier than the date on which the Board takes
action with respect thereto.
"DEFERRAL PERIOD" means the period of time during which Deferred Shares
are subject to deferral limitations under Section 7 of this Plan.
"DEFERRED SHARES" means an award pursuant to Section 7 of this Plan of the
right to receive Common Shares at the end of a specified Deferral Period.
"EMPLOYER" means the Corporation or a Subsidiary (other than a
Less-Than-Eighty-Percent Subsidiary) or a successor to the Corporation or any
such Subsidiary by merger or otherwise upon or following a Change of Control.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended from
time to time.
"EXECUTIVE" means any individual employed by any Employer in a position
having a salary grade of EX3, EX2 or EX1 (as the Corporation's salary grades
are established and in existence on July 14, 1999, and adjusting as
appropriate for any changes to the Corporation's system of classifying its
employees by salary grades implemented subsequent to such date).
"GOOD REASON" means that an Executive shall have made a good faith
determination that one or more of the following has occurred:
(i) any significant and adverse change in the Executive's
duties, responsibilities and authority, as compared in each case to the
corresponding circumstances in place on the Reference Date;
(ii) a relocation of the Executive's principal work location as
established on the Reference Date to a location that is more than 30 miles
away from such location;
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(iii) a reduction in the Executive's salary or bonus potential
that is not in either case agreed to by the Executive, or any other
significant adverse financial consequences associated with the Executive's
employment as compared to the corresponding circumstances in place on the
Reference Date; or
(iv) a breach by any Employer of its obligations under any
agreement to which the Employer and the Executive are parties that is
not cured within 20 business days following the Employer's receipt of a
written notice from the Executive specifying the particulars of such
breach in reasonable detail.
"FREE-STANDING APPRECIATION RIGHT" means an Appreciation Right granted
pursuant to Section 5 of this Plan that is not granted in tandem with an
Option Right or similar right.
"IMMEDIATE FAMILY" has the meaning ascribed thereto in Rule 16a-1(e), as
promulgated and amended from time to time by the Commission under the
Exchange Act, or any successor rule to the same effect.
"INCENTIVE STOCK OPTION" means an Option Right that is intended to quality
as an "incentive stock option" under Section 422 of the Code or any successor
provision thereto.
"LESS-THAN-EIGHTY-PERCENT SUBSIDIARY" means a Subsidiary with respect to
which the Corporation directly or indirectly owns or controls less than 80
percent of the total combined voting or other decision-making power.
"MANAGEMENT OBJECTIVES" means the achievement or performance objectives
established pursuant to this Plan for Participants who have received grants
of Performance Shares or Performance Units or, when so determined by the
Board, Restricted Shares.
"MARKET VALUE PER SHARE" means the fair market value of the Common Shares
as determined by the Board from time to time.
"NEW HIRE" means a Participant who is commencing, or has agreed to
commence, employment with the Corporation or a Subsidiary for the first time.
"NONAFFILIATE DIRECTOR" means a person who (i) is serving (or who has been
elected or appointed and has agreed to serve) as a member of the Board, (ii)
is not an officer or employee of the Corporation or any Subsidiary or a
beneficial owner of 10 percent or more of the outstanding Common Shares and
(iii) was not elected or appointed as a member of the Board pursuant to or in
connection with any contractual or other commitment on the part of the
Corporation to cause such person to be elected or appointed, or to nominate
or otherwise advance such person for election or appointment, as a member of
the Board.
"NONQUALIFIED OPTION" means an Option Right that is not intended to
qualify as a Tax-Qualified Option.
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"OPTIONEE" means the person so designated in an agreement evidencing an
outstanding Option Right.
"OPTION PRICE" means the purchase price payable upon the exercise of an
Option Right.
"OPTION RIGHT" means the right to purchase Common Shares from the
Corporation upon the exercise of a Nonqualified Option or a Tax-Qualified
Option granted pursuant to Section 4, or a Replacement Option Right granted
pursuant to Section 17(c), of this Plan.
"PARTICIPANT" means a person who is selected by the Board to receive
benefits under this Plan and (i) is at that time a Nonaffiliate Director or
an officer (including but not limited to an officer who may also be a member
of the Board) or other key employee of or a consultant to the Corporation or
any Subsidiary or (ii) has agreed to commence serving as an officer or other
key employee of or as a consultant to the Corporation or any Subsidiary.
"PERFORMANCE PERIOD" means, in respect of a Performance Share or
Performance Unit, a period of time established pursuant to Section 8 of this
Plan within which the Management Objectives relating thereto are to be
achieved.
"PERFORMANCE SHARE" means a bookkeeping entry that records the equivalent
of one Common Share awarded pursuant to Section 8 of this Plan. "PERFORMANCE
UNIT" means a bookkeeping entry that records a unit equivalent to $1.00
awarded pursuant to Section 8 of this Plan.
"REFERENCE DATE" means the day before the effective date of any Change of
Control of the Corporation.
"REPLACEMENT OPTION RIGHT" means an Option Right granted pursuant to
Section 17(c) of this Plan in exchange for the surrender and cancellation of
an option to purchase shares of another corporation that is acquired by the
Corporation or a Subsidiary by merger or otherwise.
"RESTRICTED SHARES" means Common Shares granted or sold pursuant to
Section 6 of this Plan as to which neither the substantial risk of forfeiture
nor the restrictions on transfer referred to in Section 6 hereof has expired.
"RULE 16b-3" means Rule 16b-3, as promulgated and amended from time to
time by the Commission under the Exchange Act, or any successor rule to the
same effect.
"SPREAD" means, in the case of a Free-Standing Appreciation Right, the
amount by which the Market Value per Share on the date when the Appreciation
Right is exercised exceeds the Base Price specified therein or, in the case
of a Tandem Appreciation Right, the amount by which the Market Value per
Share on the date when
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the Appreciation Right is exercised exceeds the Option Price specified in the
related Option Right.
"STOCK OPTION PLAN" means the Fleet Call, Inc. Stock Option Plan (as
amended and restated as of July 15, 1992).
"SUBSIDIARY" means a corporation, partnership, joint venture,
unincorporated association or other entity in which the Corporation has a
direct or indirect ownership or other equity interest; provided, however, for
the purpose of determining whether any person may be a Participant for the
purposes of any grant of Incentive Stock Options, "Subsidiary" means any
corporation in which the Corporation owns or controls directly or indirectly
more than 50 percent of the total combined voting power represented by all
classes of stock issued by such corporation at the time of the grant.
"TANDEM APPRECIATION RIGHT" means an Appreciation Right granted pursuant
to Section 5 of this Plan that is granted in tandem with an Option Right or
any similar right granted under any other plan of the Corporation.
"TAX-QUALIFIED OPTION" means an Option Right that is intended to qualify
under particular provisions of the Code, including but not limited to an
Incentive Stock Option.
(b) As used in this Plan, the term "employment" shall be deemed to
refer to service as a member of the Board or as a consultant, as well as to a
traditional employment relationship, as the case may be.
3. SHARES AND PERFORMANCE UNITS AVAILABLE UNDER THE PLAN. (a) (i)
Subject to adjustment as provided in Section 10 of this Plan, the number of
Common Shares covered by outstanding awards, except Replacement Option Rights,
granted under this Plan and issued or transferred upon the exercise or payment
thereof shall not in the aggregate exceed 180,000,000 Common Shares, which may
be Common Shares of original issuance or Common Shares held in treasury or a
combination thereof and which include 170,039,556 Common Shares that have been
reserved by the Board for issuance or transfer under this Plan only, the
1,843,718 Common Shares that remained available for issuance or transfer under
the Stock Option Plan and were not covered by stock options outstanding
thereunder as of July 22, 1993, and any of the 8,116,726 Common Shares that were
covered by stock options outstanding under the Stock Option Plan as of July 22,
1993, and have or may become available for issuance or transfer under this Plan
as a result of the cancellation or termination of any such options prior to the
exercise thereof; provided, however, that the number of Common Shares issued or
transferred as Restricted Shares shall not in the aggregate exceed 400,000
Common Shares, and that the number of Common Shares covered by outstanding
Option Rights granted to consultants at an Option Price per Common Share that is
less than the Market Value per Share on the Date of Grant and issued or
transferred upon the exercise thereof shall not in the aggregate exceed
2,000,000 Common Shares, subject in each case to adjustment as provided in
Section 10 of this Plan.
(ii) Subject to adjustment as provided in Section 10 of this
Plan, the number of Common Shares covered by Replacement Option Rights granted
under this Plan
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during any calendar year shall not in the aggregate exceed five percent of the
Common Shares outstanding on January 1 of that year.
(iii) For the purposes of this Section 3(a):
(1) Upon payment in cash of the benefit provided by
any award granted under this Plan, any Common Shares that were covered by
that award shall again be available for issuance or transfer hereunder.
(2) Common Shares covered by any award granted under
this Plan shall be deemed to have been issued or transferred, and shall cease
to be available for future issuance or transfer in respect of any other award
granted hereunder, at the earlier of the time when they are actually issued
or transferred or the time when dividends or dividend equivalents are paid
thereon; provided, however, that Restricted Shares shall be deemed to have
been issued or transferred at the earlier of the time when they cease to be
subject to a substantial risk of forfeiture or the time when dividends are
paid thereon.
(b) The number of Performance Units that may be granted under
this Plan shall not in the aggregate exceed 500,000. Performance Units that are
granted under this Plan, but are not earned by the Participant at the end of the
Performance Period, shall be available for future grants of Performance Units
hereunder.
4. OPTION RIGHTS. The Board may authorize grants to Participants of
options to purchase Common Shares upon such terms and conditions as the Board
may determine in accordance with the following provisions:
(a) Each grant shall specify the number of Common Shares to which it
pertains.
(b) Each grant shall specify an Option Price per Common Share, which
shall be equal to or greater than the Market Value per Share on the Date of
Grant; provided, however, that the Option Price per Common Share of a
Replacement Option Right, and that the Option Price per Common Share of an
Option Right granted to a consultant, may be less than the Market Value per
Share on the Date of Grant.
(c) Each grant shall specify the form of consideration to be paid in
satisfaction of the Option Price and the manner of payment of such
consideration, which may include (i) cash in the form of currency or check or
other cash equivalent acceptable to the Corporation, (ii) nonforfeitable,
nonrestricted Common Shares that are already owned by the optionee and have a
value at the time of exercise that is equal to the Option Price, (iii) any
other legal consideration that the Board may deem appropriate, including but
not limited to any form of consideration authorized under Section 4(d), on
such basis as the Board may determine in accordance with this Plan and (iv)
any combination of the foregoing.
(d) On or after the Date of Grant of any Nonqualified Option, the
Board may determine that payment of the Option Price may also be made in
whole or in part in the form of Restricted Shares or other Common Shares that
are subject to risk of forfeiture or
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restrictions on transfer. Unless otherwise determined by the Board on or
after the Date of Grant, whenever any Option Price is paid in whole or in
part by means of any of the forms of consideration specified in this Section
4(d), the Common Shares received by the Optionee upon the exercise of the
Nonqualified Option shall be subject to the same risks of forfeiture or
restrictions on transfer as those that applied to the consideration
surrendered by the Optionee; provided, however, that such risks of forfeiture
and restrictions on transfer shall apply only to the same number of Common
Shares received by the Optionee as applied to the forfeitable or restricted
Common Shares surrendered by the Optionee.
(e) Any grant may provide for deferred payment of the Option Price
from the proceeds of sale through a broker on the date of exercise of some or
all of the Common Shares to which the exercise relates.
(f) Successive grants may be made to the same Participant regardless
of whether any Option Rights previously granted to the Participant remain
unexercised.
(g) Each grant (i) shall specify the period or periods of continuous
employment of the Optionee by the Corporation or any Subsidiary that are
necessary before the Option Rights or installments thereof shall become
exercisable and (ii) in the case of any grant subsequent to July 14, 1999,
unless otherwise expressly determined in a resolution duly adopted by the
Board on the Date of Grant or such later date on which the Board may ratify
such grant, shall provide that the Option Rights shall (A) if the Optionee is
a Nonaffiliate Director, immediately become fully exercisable upon the
occurrence of a Change of Control of the Corporation or (B) if the Optionee
is recognized by any Employer as a regular full time employee who is subject
to U.S. income tax withholding, immediately become fully exercisable upon the
termination of the Optionee's employment by an Employer without Cause during
the Accelerated Vesting Period or also, in the case of an Optionee who is an
Executive, upon the termination of the Optionee's employment by the Optionee
for Good Reason during the Accelerated Vesting Period; provided, however,
that any such Accelerated Vesting Provision shall be deemed void ab initio
and shall be of no force or effect, if it should be determined that any such
provision would prevent a proposed merger or other business combination that
is intended by the parties thereto to be accounted for as a pooling of
interests from being so accounted for.
(h) Option Rights granted pursuant to this Section 4 may be
Nonqualified Options or Tax-Qualified Options or combinations thereof.
(i) On or after the Date of Grant of any Nonqualified Option, the
Board may provide for the payment to the Optionee of dividend equivalents
thereon in cash or Common Shares on a current, deferred or contingent basis,
or the Board may provide that any dividend equivalents shall be credited
against the Option Price.
(j) No Option Right granted pursuant to this Section 4 may be
exercised more than 10 years from the Date of Grant.
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(k) Each grant shall be evidenced by an agreement that shall be
executed on behalf of the Corporation by any officer thereof and delivered to
and accepted by the Optionee and shall contain such terms and provisions as
the Board may determine consistent with this Plan.
5. APPRECIATION RIGHTS. The Board may authorize grants to
Participants of Appreciation Rights. An Appreciation Right shall be a right of
the Participant to receive from the Corporation an amount that shall be
determined by the Board and shall be expressed as a percentage (not exceeding
100 percent) of the Spread at the time of the exercise of the Appreciation
Right. Any grant of Appreciation Rights under this Plan shall be upon such terms
and conditions as the Board may determine in accordance with the following
provisions:
(a) Any grant may specify that the amount payable upon the exercise
of an Appreciation Right may be paid by the Corporation in cash, Common
Shares or any combination thereof and may (i) either grant to the Participant
or reserve to the Board the right to elect among those alternatives or (ii)
preclude the right of the Participant to receive and the Corporation to issue
Common Shares or other equity securities in lieu of cash; provided, however,
that no form of consideration or manner of payment that would cause Rule
16b-3 to cease to apply to this Plan shall be permitted.
(b) Any grant may specify that the amount payable upon the exercise
of an Appreciation Right shall not exceed a maximum specified by the Board on
the Date of Grant.
(c) Any grant may specify (i) a waiting period or periods before
Appreciation Rights shall become exercisable and (ii) permissible dates or
periods on or during which Appreciation Rights shall be exercisable.
(d) Any grant may specify that an Appreciation Right may be
exercised only in the event of a Change of Control or other similar
transaction or event.
(e) On or after the Date of Grant of any Appreciation Rights, the
Board may provide for the payment to the Participant of dividend equivalents
thereon in cash or Common Shares on a current, deferred or contingent basis.
(f) Each grant shall be evidenced by an agreement that shall be
executed on behalf of the Corporation by any officer thereof and delivered to
and accepted by the Participant and shall contain such terms and provisions
as the Board may determine consistent with this Plan.
(g) Regarding Tandem Appreciation Rights only: Each grant shall
specifically identify the related Option Right (or similar right granted
under any other plan of the Corporation) and shall provide that the Tandem
Appreciation Right may be exercised only (i) at a time when the related
Option Right (or such similar right) is also exercisable and the Spread is
positive and (ii) by surrender of the related Option Right (or such similar
right) for cancellation.
(h) Regarding Free-Standing Appreciation Rights only:
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(i) Each grant shall specify in respect of each Free-Standing
Appreciation Right a Base Price per Common Share, which shall be equal to
or greater than the Market Value per Share on the Date of Grant;
(ii) Successive grants may be made to the same Participant
regardless of whether any Free-Standing Appreciation Rights previously
granted to the Participant remain unexercised;
(iii) Each grant shall specify the period or periods of
continuous employment of the Participant by the Corporation or any
Subsidiary that are necessary before the Free-Standing Appreciation Rights
or installments thereof shall become exercisable, and any grant may
provide for the earlier exercise of the Free-Standing Appreciation Rights
in the event of a Change of Control or other similar transaction or event;
and
(iv) No Free-Standing Appreciation Right granted under this
Plan may be exercised more than 10 years from the Date of Grant.
6. RESTRICTED SHARES. The Board may authorize grants or sales to
Participants of Restricted Shares upon such terms and conditions as the Board
may determine in accordance with the following provisions:
(a) Each grant or sale shall constitute an immediate transfer of the
ownership of Common Shares to the Participant in consideration of the
performance of services, entitling such Participant to dividend, voting and
other ownership rights, subject to the substantial risk of forfeiture and
restrictions on transfer hereinafter referred to.
(b) Each grant or sale may be made without additional consideration
from the Participant or in consideration of a payment by the Participant that
is less than the Market Value per Share on the Date of Grant.
(c) Each grant or sale shall provide that the Restricted Shares
covered thereby shall be subject to a "substantial risk of forfeiture" within
the meaning of Section 83 of the Code for a period to be determined by the
Board on the Date of Grant, and any grant or sale may provide for the earlier
termination of such period in the event of a Change of Control or other
similar transaction or event.
(d) Each grant or sale shall provide that, during the period for
which such substantial risk of forfeiture is to continue, the transferability
of the Restricted Shares shall be prohibited or restricted in the manner and
to the extent prescribed by the Board on the Date of Grant. Such restrictions
may include without limitation rights of repurchase or first refusal in the
Corporation or provisions subjecting the Restricted Shares to a continuing
substantial risk of forfeiture in the hands of any transferee.
(e) Any grant or sale may require that any or all dividends or other
distributions paid on the Restricted Shares during the period of such
restrictions be automatically sequestered and reinvested on an immediate or
deferred basis in additional
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Common Shares, which may be subject to the same restrictions as the
underlying award or such other restrictions as the Board may determine.
(f) Each grant or sale shall be evidenced by an agreement that shall
be executed on behalf of the Corporation by any officer thereof and delivered
to and accepted by the Participant and shall contain such terms and
provisions as the Board may determine consistent with this Plan. Unless
otherwise directed by the Board, all certificates representing Restricted
Shares, together with a stock power that shall be endorsed in blank by the
Participant with respect to the Restricted Shares, shall be held in custody
by the Corporation until all restrictions thereon lapse.
7. DEFERRED SHARES. The Board may authorize grants or sales of
Deferred Shares to Participants upon such terms and conditions as the Board may
determine in accordance with the following provisions:
(a) Each grant or sale shall constitute the agreement by the
Corporation to issue or transfer Common Shares to the Participant in the
future in consideration of the performance of services, subject to the
fulfillment during the Deferral Period of such conditions as the Board may
specify.
(b) Each grant or sale may be made without additional consideration
from the Participant or in consideration of a payment by the Participant that
is less than the Market Value per Share on the Date of Grant.
(c) Each grant or sale (i) shall provide that the Deferred Shares
covered thereby shall be subject to a Deferral Period, which shall be
determined by the Board on the Date of Grant, and (ii) in the case of any
grant or sale subsequent to July 14, 1999, unless otherwise expressly
determined in a resolution duly adopted by the Board on the Date of Grant or
such later date on which the Board may ratify such grant or sale, shall
provide for the earlier termination of the Deferral Period, and the immediate
vesting of the Participant's rights to all of the Deferred Shares subject to
the grant or sale, (A) if the Participant is a Nonaffiliate Director, upon
the occurrence of a Change of Control of the Corporation or (B) if the
Participant is recognized by any Employer as a regular full time employee who
is subject to U.S. income tax withholding, upon the termination of the
Participant's employment by an Employer without Cause during the Accelerated
Vesting Period or also, in the case of a Participant who is an Executive,
upon the termination of the Participant's employment by the Participant for
Good Reason during the Accelerated Vesting Period; provided, however, that
any such Accelerated Vesting Provision shall be deemed void ab initio and
shall be of no force or effect, if it should be determined that any such
provision would prevent a proposed merger or other business combination that
is intended by the parties thereto to be accounted for as a pooling of
interests from being so accounted for.
(d) During the Deferral Period, the Participant shall not have any
rights of ownership in the Deferred Shares, shall not have any right to vote
the Deferred Shares and, except as provided in Section 9(c), shall not have
any right to transfer any rights under the subject award, but the Board may
on or after the Date of Grant authorize the
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payment of dividend equivalents on the Deferred Shares in cash or additional
Common Shares on a current, deferred or contingent basis.
(e) Each grant or sale shall be evidenced by an agreement that shall
be executed on behalf of the Corporation by any officer thereof and delivered
to and accepted by the Participant and shall contain such terms and
provisions as the Board may determine consistent with this Plan.
8. PERFORMANCE SHARES AND PERFORMANCE UNITS. The Board may
authorize grants of Performance Shares and Performance Units, which shall become
payable to the Participant upon the achievement of specified Management
Objectives, upon such terms and conditions as the Board may determine in
accordance with the following provisions:
(a) Each grant shall specify the number of Performance Shares or
Performance Units to which it pertains, which may be subject to adjustment to
reflect changes in compensation or other factors.
(b) The Performance Period with respect to each Performance Share or
Performance Unit (i) shall be determined by the Board on the Date of Grant
and (ii) in the case of any grant made subsequent to July 14, 1999, unless
otherwise expressly determined in a resolution duly adopted by the Board on
the Date of Grant or such later date on which the Board may ratify such
grant, shall provide for the earlier termination of the Performance Period,
and the immediate vesting of the Participant's rights to all of the
Performance Shares or Performance Units subject to the grant, (A) if the
Participant is a Nonaffiliate Director, upon the occurrence of a Change of
Control of the Corporation or (B) if the Participant is recognized by any
Employer as a regular full time employee who is subject to U.S. income tax
withholding, upon the termination of the Participant's employment by an
Employer without Cause during the Accelerated Vesting Period or also, in the
case of a Participant who is an Executive, upon the termination of the
Participant's employment by the Participant for Good Reason during the
Accelerated Vesting Period; provided, however, that any such Accelerated
Vesting Provision shall be deemed void ab initio and shall be of no force or
effect, if it should be determined that any such provision would prevent a
proposed merger or other business combination that is intended by the parties
thereto to be accounted for as a pooling of interests from being so accounted
for.
(c) Each grant shall specify the Management Objectives that are to
be achieved by the Participant, which may be described in terms of
Corporation-wide objectives or objectives that are related to the performance
of the individual Participant or the Subsidiary, division, department or
function within the Corporation or Subsidiary in which the Participant is
employed or with respect to which the Participant provides consulting
services.
(d) Each grant shall specify in respect of the specified Management
Objectives a minimum acceptable level of achievement below which no payment
will be made and shall set forth a formula for determining the amount of any
payment to be made
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if performance is at or above the minimum acceptable level but falls short of
full achievement of the specified Management Objectives.
(e) Each grant shall specify the time and manner of payment of
Performance Shares or Performance Units that shall have been earned, and any
grant may specify that any such amount may be paid by the Corporation in
cash, Common Shares or any combination thereof and may either grant to the
Participant or reserve to the Board the right to elect among those
alternatives; provided, however, that no form of consideration or manner of
payment that would cause Rule 16b-3 to cease to apply to this Plan shall be
permitted.
(f) Any grant of Performance Shares may specify that the amount
payable with respect thereto may not exceed a maximum specified by the Board
on the Date of Grant. Any grant of Performance Units may specify that the
amount payable, or the number of Common Shares issuable, with respect thereto
may not exceed maximums specified by the Board on the Date of Grant
(g) On or after the Date of Grant of Performance Shares, the Board
may provide for the payment to the Participant of dividend equivalents
thereon in cash or additional Common Shares on a current, deferred or
contingent basis.
(h) The Board may adjust Management Objectives and the related
minimum acceptable level of achievement if, in the sole judgment of the
Board, events or transactions have occurred after the Date of Grant that are
unrelated to the performance of the Participant and result in distortion of
the Management Objectives or the related minimum acceptable level of
achievement.
(i) Each grant shall be evidenced by an agreement that shall be
executed on behalf of the Corporation by any officer thereof and delivered to
and accepted by the Participant and shall contain such terms and provisions
as the Board may determine consistent with this Plan.
9. TRANSFERABILITY. (a) Except as otherwise determined by the
Board, no Option Right, Appreciation Right or other derivative security granted
under this Plan shall be transferable by a Participant other than by will or the
laws of descent and distribution and, except as otherwise determined by the
Board, Option Rights and Appreciation Rights shall be exercisable during a
Participant's lifetime only by the Participant or his or her guardian or legal
representative.
(b) The Board may specify at the Date of Grant that all or any part
of the Common Shares that are to be issued or transferred by the Corporation
upon the exercise of Option Rights or Appreciation Rights, upon the termination
of the Deferral Period applicable to Deferred Shares or upon payment under any
grant of Performance Shares or Performance Units, or are to be no longer subject
to the substantial risk of forfeiture and restrictions on transfer referred to
in Section 6 of this Plan, shall be subject to further restrictions on transfer.
(c) Notwithstanding the provisions of Section 9(a), Option Rights
(other than Incentive Stock Options), Appreciation Rights, Restricted Shares,
Deferred Shares, Performance
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Shares and Performance Units shall be transferable by a Participant, without
payment of consideration therefor by the transferee, to any one or more members
of the Participant's Immediate Family (or to one or more trusts established
solely for the benefit of one or more members of the Participant's Immediate
Family or to one or more partnerships in which the only partners are members of
the Participant's Immediate Family); provided, however, that (i) no such
transfer shall be effective unless reasonable prior notice thereof is delivered
to the Corporation and such transfer is thereafter effected in accordance with
any terms and conditions that shall have been made applicable thereto by the
Corporation or the Board and (ii) any such transferee shall be subject to the
same terms and conditions hereunder as the Participant.
10. ADJUSTMENTS. The Board may make or provide for such adjustments
in the number of Common Shares covered by outstanding Option Rights,
Appreciation Rights, Deferred Shares and Performance Shares granted hereunder,
the Option Prices per Common Share or Base Prices per Common Share applicable to
any such Option Rights and Appreciation Rights, and the kind of shares
(including shares of another issuer) covered thereby, as the Board may in good
faith determine to be equitably required in order to prevent dilution or
expansion of the rights of Participants that otherwise would result from (a) any
stock dividend, stock split, combination of shares, recapitalization or other
change in the capital structure of the Corporation or (b) any merger,
consolidation, spin-off, spin-out, split-off, split-up, reorganization, partial
or complete liquidation or other distribution of assets, issuance of warrants or
other rights to purchase securities or any other corporate transaction or event
having an effect similar to any of the foregoing. In the event of any such
transaction or event, the Board may provide in substitution for any or all
outstanding awards under this Plan such alternative consideration as it may in
good faith determine to be equitable under the circumstances and may require in
connection therewith the surrender of all awards so replaced. On or after the
Date of Grant of any award under this Plan, the Board may provide in the
agreement evidencing the award that the holder of the award may elect to receive
an equivalent award in respect of securities of the surviving entity of any
merger, consolidation or other transaction or event having a similar effect, or
the Board may provide that the holder will automatically be entitled to receive
such an equivalent award. The Board may also make or provide for such
adjustments in the numbers of Common Shares specified in Sections 3(a)(i) and
3(a)(ii) of this Plan as the Board may in good faith determine to be appropriate
in order to reflect any transaction or event described in this Section 10.
11. FRACTIONAL SHARES. The Corporation shall not be required to
issue any fractional Common Shares pursuant to this Plan. The Board may provide
for the elimination of fractions or for the settlement thereof in cash.
12. WITHHOLDING TAXES. To the extent that the Corporation is
required to withhold federal, state, local or foreign taxes in connection with
any payment made or benefit realized by a Participant or other person under this
Plan, and the amounts available to the Corporation for the withholding are
insufficient, it shall be a condition to the receipt of any such payment or the
realization of any such benefit that the Participant or such other person make
arrangements satisfactory to the Corporation for payment of the balance of any
taxes required to be withheld. At the discretion of the Board, any such
arrangements may include relinquishment of a portion of any such payment or
benefit. The Corporation and any Participant or such other
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person may also make similar arrangements with respect to the payment of any
taxes with respect to which withholding is not required.
13. PARTICIPATION BY EMPLOYEES OF OR CONSULTANTS TO A
LESS-THAN-EIGHTY-PERCENT SUBSIDIARY. As a condition to the effectiveness of any
grant or award to be made hereunder to a Participant who is an employee of or a
consultant to a Less-Than-Eighty-Percent Subsidiary, regardless of whether the
Participant is also employed by or engaged as a consultant to the Corporation or
another Subsidiary, the Board may require the Less-Than-Eighty-Percent
Subsidiary to agree to transfer to the Participant (as, if and when provided for
under this Plan and any applicable agreement entered into between the
Participant and the Less-Than-Eighty-Percent Subsidiary pursuant to this Plan)
the Common Shares that would otherwise be delivered by the Corporation upon
receipt by the Less-Than-Eighty-Percent Subsidiary of any consideration then
otherwise payable by the Participant to the Corporation. Any such award may be
evidenced by an agreement between the Participant and the
Less-Than-Eighty-Percent Subsidiary, in lieu of the Corporation, on terms
consistent with this Plan and approved by the Board and the
Less-Than-Eighty-Percent Subsidiary. All Common Shares so delivered by or to a
Less-Than-Eighty-Percent Subsidiary will be treated as if they had been
delivered by or to the Corporation for the purposes of Section 3 of this Plan,
and all references to the Corporation in this Plan shall be deemed to refer to
the Less-Than-Eighty-Percent Subsidiary except with respect to the definitions
of the Board and the Board and in other cases where the context otherwise
requires.
14. CERTAIN TERMINATIONS OF EMPLOYMENT, HARDSHIP AND APPROVED LEAVES
OF ABSENCE. Notwithstanding any other provision of this Plan to the contrary, in
the event of termination of employment by reason of death, disability, normal
retirement, early retirement with the consent of the Corporation, termination of
employment to enter public service with the consent of the Corporation or leave
of absence approved by the Corporation, or in the event of hardship or other
special circumstances, of a Participant who holds an Option Right or
Appreciation Right that is not immediately and fully exercisable, any Restricted
Shares as to which the substantial risk of forfeiture or the prohibition or
restriction on transfer has not lapsed, any Deferred Shares as to which the
Deferral Period is not complete, any Performance Shares or Performance Units
that have not been fully earned, or any Common Shares that are subject to any
transfer restriction pursuant to Section 9(b) of this Plan, the Board may take
any action that it deems to be equitable under the circumstances or in the best
interests of the Corporation, including but not limited to waiving or modifying
any limitation or requirement with respect to any award under this Plan.
15. FOREIGN PARTICIPANTS. In order to facilitate the making of any
award or combination of awards under this Plan, the Board may provide for such
special terms for awards to Participants who are foreign nationals, or who are
employed by or engaged as consultants to the Corporation or any Subsidiary
outside of the United States of America, as the Board may consider necessary or
appropriate to accommodate differences in local law, tax policy or custom. In
addition, the Board may approve such supplements to, or amendments, restatements
or alternative versions of, this Plan as it may consider necessary or
appropriate for such purposes without thereby affecting the terms of this Plan
as in effect for any other purpose; provided, however, that no such supplements,
amendments, restatements or alternative versions shall include any provisions
that are inconsistent with the terms of this Plan, as then in effect, unless
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this Plan could have been amended to eliminate the inconsistency without further
approval by the stockholders of the Corporation.
16. ADMINISTRATION OF THE PLAN. (a) This Plan shall be administered
by the Board, which may from time to time delegate all or any part of its
authority under this Plan to a committee of the Board consisting of two or more
members of the Board, or a subcommittee of a committee of the Board consisting
exclusively of two or more "Non-Employee Directors" (as defined in Rule 16b-3),
appointed by the Board. A majority of the committee (or subcommittee) shall
constitute a quorum, and the action of the members of the committee (or
subcommittee) present at any meeting at which a quorum is present, or acts
unanimously approved in writing, shall be the acts of the committee (or
subcommittee). To the extent of any such delegation, references in this Plan to
the Board shall be deemed to be references to any such committee or
subcommittee.
(b) The Board may from time to time reserve a specified number of
Common Shares, subject to adjustment as provided in Section 10 of this Plan, for
grants of Nonqualified Options to New Hires upon commencement of their
employment with the Corporation or any Subsidiary, or to any Participant in
connection with a promotion or other form of special recognition approved in
writing by the Chief Executive Officer, and may delegate to one or more officers
of the Corporation the authority to determine the Participants to whom such
Nonqualified Options shall be granted in accordance with this Section 16(b), and
to determine the number of such Common Shares to which any such Nonqualified
Option shall pertain, subject to the terms and conditions of this Plan and the
terms and conditions of an agreement evidencing any such Nonqualified Option and
approved by the Board. For the purposes of Section 4(b) of this Plan, as it
relates to any Nonqualified Option that shall be granted pursuant to this
Section 16(b), (i) the Date of Grant shall be the date on which the New Hire's
employment with the Corporation or any Subsidiary actually commences or the date
on which the promotion or other form of special recognition is approved in
writing by the Chief Executive Officer, as the case may be, and (ii) unless the
Board determines otherwise, the Option Price per Common Share shall be the
closing price of the Common Shares on the Nasdaq Stock Market on the Date of
Grant.
(c) The interpretation and construction by the Board of any
provision of this Plan or any agreement, notification or document evidencing the
grant of Option Rights, Appreciation Rights, Restricted Shares, Deferred Shares,
Performance Shares or Performance Units, and any determination by the Board
pursuant to any provision of this Plan or any such agreement, notification or
document, shall be final and conclusive. No member of the Board shall be liable
for any such action taken or determination made in good faith.
17. AMENDMENTS AND OTHER MATTERS. (a) The Board may at any time and
from time to time amend this Plan in whole or in part; provided, however, that
(1) any amendment that must be approved by the stockholders of the Corporation
in order to comply with applicable law or the rules of the Nasdaq National
Market shall not be effective unless and until such approval has been obtained
and (2) the provisions of Sections 4(g), 7(c) and 8(b), including but not
limited to clause (ii) of each of these Sections, may not be amended following a
Change of Control in any way that would adversely affect the rights of holders
of awards granted under Sections 4, 7 and 8 hereof after July 14, 1999.
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(b) With the concurrence of the affected Participant, the Board may
cancel any agreement evidencing Option Rights or any other award granted under
this Plan. In the event of any such cancellation, the Board may authorize the
granting of new Option Rights or other awards hereunder, which may or may not
cover the same number of Common Shares as had been covered by the canceled
Option Rights or other award, at such Option Price, in such manner and subject
to such other terms, conditions and discretion as would have been permitted
under this Plan had the canceled Option Rights or other award not been granted.
(c) The Board may grant under this Plan any award or combination of
awards authorized under this Plan, including but not limited to Replacement
Option Rights, in exchange for the surrender and cancellation of an award that
was not granted under this Plan (including but not limited to an award that was
granted by the Corporation or a Subsidiary, or by another corporation that is
acquired by the Corporation or a Subsidiary by merger or otherwise, prior to the
adoption of this Plan by the Board), and any such award or combination of awards
so granted under this Plan may or may not cover the same number of Common Shares
as had been covered by the canceled award and shall be subject to such other
terms, conditions and discretion as would have been permitted under this Plan
had the canceled award not been granted.
(d) This Plan shall not confer upon any Participant any right with
respect to continuance of employment or other service with the Corporation or
any Subsidiary and shall not interfere in any way with any right that the
Corporation or any Subsidiary would otherwise have to terminate any
Participant's employment or other service at any time.
(e) To the extent that any provision of this Plan would prevent any
Option Right that was intended to qualify as a Tax-Qualified Option from so
qualifying, any such provision shall be null and void with respect to any such
Option Right; provided, however, that any such provision shall remain in effect
with respect to other Option Rights, and there shall be no further effect on any
provision of this Plan.
(f) The Board may also permit Participants to elect to defer the
issuance of Common Shares or the settlement of awards in cash under this Plan
pursuant to such procedures, programs or rules as the Board may establish for
the purposes of this Plan. The Board may also provide that deferred issuances
and settlements include the payment or crediting of dividend equivalents or
interest on the deferral amounts.
(g) The Board may condition the grant of any award or combination of
awards authorized under this Plan on the surrender or deferral by the
Participant of his or her right to receive a cash bonus or other compensation
otherwise payable by the Company or a Subsidiary to the Participant.
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