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EXHIBIT 10.1
BTG, INC.
DIRECTORS STOCK OPTION PLAN
AMENDED AND RESTATED AS OF DECEMBER 17, 1998
BTG, INC., a Virginia corporation (the "Corporation"), sets forth herein
the terms of the Directors Stock Option Plan (the "Plan") as follows:
1. PURPOSE
1.1. The Plan is intended to attract and retain the best possible
members of the Board and to provide additional incentives to those directors to
promote the success of the Corporation. The Plan provides Eligible Directors an
opportunity to purchase shares of the Stock pursuant to Options. Options granted
under the Plan shall not constitute "incentive stock options" within the meaning
of Section 422 of the Code.
1.2. The Plan is intended to constitute a "formula plan" and Eligible
Directors are intended to be "disinterested administrators" of other plans
maintained by the Corporation for purposes of Rule 16b-3 under the Exchange Act.
2. DEFINITIONS
For purposes of interpreting the Plan and related documents (including
Stock Option Agreements), the following definitions shall apply:
2.1. "Additional Option" means any Option other than an Initial Option.
2.2. "Administrator" means the Chief Financial Officer of the
Corporation or such other person as is appointed by the Board to serve as
Administrator.
2.3. "Board" means the board of directors of the Corporation.
2.4. "Code" means the Internal Revenue Code of 1986, as amended.
2.5. "Commencement of Service" means the date of election of the
Eligible Director to his or her first term as a Director.
2.6. "Corporation" means BTG, Inc., a Virginia corporation.
2.7. "Effective Date" means the date of adoption of the Plan by the
Board.
2.8. "Eligible Director" means a member of the Board who is not an
officer or employee of the Corporation or any of its subsidiaries.
2.9. "Exchange Act" means the Securities Exchange Act of 1934, as now in
effect or hereafter amended.
2.10. "Exercise Price" means the Option Price multiplied by the number
of shares of Stock purchased pursuant to exercise of an Option.
2.11. "Expiration Date" means the tenth anniversary of the Grant Date
or, if earlier, the termination of the Option pursuant to Section 4.2(c) hereof.
2.12. "Fair Market Value" means the value of each share of Stock subject
to the Plan determined as follows: If on the Grant Date or other determination
date the Stock is listed on an established national or regional stock exchange,
is admitted to quotation on the National
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Association of Securities Dealers Automated Quotation System, or is publicly
traded on an established securities market, the Fair Market Value of the Stock
shall be the closing price of the Stock on such exchange or in such market (the
highest such closing price if there is more than one such exchange or market) on
the trading day immediately preceding the Grant Date or other determination date
(or, if there is no such reported closing price, the Fair Market Value shall be
the mean between the highest bid and lowest asked prices or between the high and
low sale prices on such trading day), or, if no sale of the Stock is reported
for such trading day, on the next preceding day on which any sale shall have
been reported. If the Stock is not listed on such an exchange, quoted on such
system or traded on such a market, Fair Market Value shall be determined by the
Administrator in good faith.
2.13. "Grant Date" means the date on which an Option grant takes effect
pursuant to Section 7 hereof.
2.14. "Initial Option" means an Option received by each Eligible
Director as of the Effective Date or thereafter as of an Eligible Director's
Commencement of Service.
2.15. "Option" means any option to purchase one or more shares of Stock
pursuant to the Plan, including both Initial Options and Additional Options.
2.16. "Optionee" means an Eligible Director who holds an Option.
2.17. "Option Period" means the period during which Options may be
exercised as defined in Section 9 hereof.
2.18. "Option Price" means the purchase price for each share of Stock
subject to an Option.
2.19. "Securities Act" means the Securities Act of 1933, as now in
effect or as hereafter amended.
2.20. "Stock" means the Common Stock of the Corporation.
2.21. "Stock Option Agreement" means the written agreement evidencing
grant of an Option hereunder.
3. ADMINISTRATION
The Plan shall be administered by the Administrator. The Administrator's
responsibilities under the Plan shall be limited to taking all legal actions
necessary to document the Options provided herein, to maintain appropriate
records and reports regarding those Options, and to take all acts authorized or
required by the Plan.
4. STOCK SUBJECT TO THE PLAN
4.1. Options to purchase not more than 100,000 shares of the Stock may
be granted under the Plan. If any Option expires, terminates or is terminated or
cancelled for any reason before it is exercised in full, the shares of Stock
that were subject to the unexercised portion of the Option shall be available
for future Options granted under the Plan.
4.2(a). If the outstanding shares of Stock are increased or decreased or
changed into or exchanged for a different number or kind of shares or other
securities of the Corporation by reason of any recapitalization,
reclassification, stock split-up, combination of shares, exchange of shares,
stock dividend or other distribution payable on capital stock, or other increase
or decrease in such shares effected without receipt of consideration by the
Corporation, occurring after the Effective Date, the number and kinds of shares
for the purchase of which Options
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may be granted under the Plan shall be adjusted proportionately and accordingly
by the Corporation. In addition, the number and kind of shares for which Options
are outstanding shall be adjusted proportionately and accordingly so that the
proportionate interest of the holder of the Option immediately following such
event shall, to the extent practicable, be the same as immediately prior to such
event. Any such adjustment in outstanding Options shall not change the aggregate
Option Price payable with respect to shares subject to the unexercised portion
of the Option outstanding but shall include a corresponding proportionate
adjustment in the Option Price per share.
4.2(b). Subject to Section 4.2(c) hereof, if the Corporation shall be
the surviving corporation in any reorganization, merger or consolidation of the
Corporation with one or more other corporations, any Option theretofore granted
pursuant to the Plan shall pertain to and apply to the securities to which a
holder of the number of shares of Stock subject to such Option would have been
entitled immediately following such reorganization, merger or consolidation,
with a corresponding proportionate adjustment of the Option Price per share so
that the aggregate Option Price thereafter shall be the same as the aggregate
Option Price of the shares remaining subject to the Option immediately prior to
such reorganization, merger or consolidation.
4.2(c). Upon the dissolution or liquidation of the Corporation, or upon
a merger, consolidation or reorganization of the Corporation with one or more
other corporations in which the Corporation is not the surviving corporation, or
upon a sale of substantially all of the assets of the Corporation to another
corporation, or upon any transaction (including, without limitation, a merger or
reorganization in which the Corporation is the surviving corporation) approved
by the Board which results in any person or entity owning 80 percent or more of
the combined voting power of all classes of stock of the Corporation, the Plan
and all Options outstanding hereunder shall terminate, except to the extent
provision is made in writing in connection with such transaction for the
continuation of the Plan, the assumption of the Options theretofore granted, or
for the substitution for such Options of new options covering the stock of a
successor corporation, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kinds of shares and exercise prices, in which
event the Plan (if applicable) and Options theretofore granted shall continue in
the manner and under the terms so provided. In the event of any such termination
of the Plan and Options, each individual holding an Option shall have the right
(subject to the limitations on exercise set forth in Section 9 below)
immediately prior to the occurrence of such termination and during such period
occurring prior to such termination as the Board in its sole discretion shall
determine and designate, to exercise such Option to the extent that such Option
was otherwise exercisable at the time such termination occurs. The Administrator
shall send written notice of an event that will result in such a termination to
all individuals who hold Options not later than the time at which the
Corporation gives notice thereof to its stockholders.
4.2(d). Adjustments under this Section 4.2 related to stock or
securities of the Corporation shall be made by the Administrator, whose
determination in that respect shall be final and conclusive. No fractional
shares of Stock or units of other securities shall be issued pursuant to any
such adjustment, and any fractions resulting from any such adjustment shall be
eliminated in each case by rounding downward to the nearest whole share or unit.
4.2(e). The grant of an Option pursuant to the Plan shall not affect or
limit in any way the right or power of the Corporation to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge, consolidate, dissolve or liquidate, or to sell or
transfer all or any part of its business or assets.
5. ELIGIBILITY
Eligibility under the Plan is limited to Eligible Directors.
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6. OPTION PRICE
The Option Price of the Stock covered by each Option granted under the
Plan prior to December 17, 1998 shall be the Fair Market Value of such Stock on
the Grant Date. The Option Price of the Stock covered by each Option granted
under the Plan, on or after December 17, 1998, shall be 110% of the Fair Market
Value of such Stock on the Grant Date. The Option Price shall be subject to
adjustment as provided in Section 4.2 hereof.
7. NUMBER OF SHARES AND GRANT DATES
On the Effective Date, each Eligible Director then serving on the Board
shall be granted an Initial Option to purchase shares of Stock, the number of
shares of which will vary depending upon each Eligible Director's years of
service as a director of the Corporation as of the time of the Effective Date,
as follows: (1) more than seven years of service - 2,500 shares; (2) between
three and seven years of service - 2,000 shares; (3) between zero and three
years of service - 1,500 shares; and (4) no service - 1,000 shares. Prior to
December 17, 1998, each Eligible Director whose Commencement of Service is after
the Effective Date shall be granted an Initial Option to purchase 1,000 shares
of Stock as of the date of the Eligible Director's Commencement of Service. An
Eligible Director also shall be granted an Additional Option to purchase 1,000
shares of Stock on each anniversary of the Grant Date of the Initial Option if
the Eligible Director continues to be an Eligible Director on each of those
anniversary dates. (On or after December 17, 1998, the amount subject to grant
shall be amended as follows: each Eligible Director whose Commencement of
Service is on or after December 17, 1998 shall be granted an Initial Option to
purchase 2,500 shares of Stock as of the date of the Eligible Director's
Commencement of Service. Each Eligible Director also shall be granted an
Additional Option to purchase 2,500 shares of Stock on each anniversary of the
Grant Date of the Initial Option if the Eligible Director continues to be an
Eligible Director on each of those anniversary dates.)
8. VESTING OF OPTIONS
Subject to Section 9 hereof, the Options granted to each Eligible
Director shall be vested upon the Grant Date.
9. OPTION PERIOD
An Option shall be exercisable only during the Option Period. The Option
Period shall commence six months after the Grant Date and shall end at the close
of business on the Expiration Date; provided, however, that in no event shall
any Option Period commence prior to approval of the Plan by the Corporation's
stockholders. The Option granted to an Eligible Director will terminate on the
Expiration Date.
10. TIMING AND METHOD OF EXERCISE
Subject to Sections 8 and 9 hereof, an Optionee may, at any time,
exercise an Option with respect to all or any part of the shares of Stock then
subject to such Option by giving the Corporation written notice of exercise,
specifying the number of shares as to which the Option is being exercised. Such
notice shall be addressed to the Administrator at the Corporation's principal
office, and shall be effective when actually received (by personal delivery, fax
or other delivery) by the Administrator. Such notice shall be accompanied by an
amount equal to the Exercise Price of such shares, in the form of any one or
combination of the following: (a) cash or cash equivalents, or (b) shares of
Stock valued at Fair Market Value in accordance with the Plan; provided,
however, that the Board may in its discretion impose and set forth in the Option
Agreement pertaining to an Option such limitations or prohibitions on the use of
shares of Stock to exercise Options as it deems appropriate. Shares of Stock
acquired by the Optionee through exercise of an Option may be surrendered in
payment of the Exercise Price of Options; provided, however, that any Stock
surrendered in payment must have been (a) held by the
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Optionee for more than six months at the time of surrender, or (b) acquired
under an Option granted not less than six months prior to the time of surrender.
Payment in full of the Exercise Price need not accompany the written notice of
exercise provided the notice directs that the Stock certificate or certificates
for the shares for which the Option is exercised be delivered to a licensed
broker acceptable to the Corporation as the agent for the individual exercising
the Option and, at the time such Stock certificate or certificates are
delivered, the broker tenders to the Corporation cash (or cash equivalents
acceptable to the Corporation) equal to the Exercise Price.
11. NO STOCKHOLDER RIGHTS UNDER OPTION
Neither an Optionee nor any person entitled to exercise an Optionee's
rights in the event of an Optionee's death shall have any of the rights of a
stockholder with respect to the shares of Stock subject to an Option except to
the extent the certificates for such shares shall have been issued upon the
exercise of the Option.
12. CONTINUATION OF SERVICE
Nothing in the Plan shall confer upon any person any right to continue
as a member of the Board or interfere in any way with the right of the
Corporation to terminate such relationship.
13. STOCK OPTION AGREEMENT
Each Option granted pursuant to the Plan shall be evidenced by a written
Stock Option Agreement notifying the Optionee of the grant and incorporating the
terms of the Plan. The Stock Option Agreement shall be executed by the
Corporation and the Optionee.
14. WITHHOLDING
The Corporation shall have the right to withhold, or require an Optionee
to remit to the Corporation, an amount sufficient to satisfy any applicable
federal, state or local withholding tax requirements imposed with respect to
exercise of Options. To the extent permissible under applicable tax, securities
and other laws, the Optionee may satisfy a tax withholding requirement by
directing the Corporation to apply shares of Stock to which the Optionee is
entitled as a result of the exercise of an Option to satisfy withholding
requirements under this Section 14.
15. NON-TRANSFERABILITY OF OPTIONS
Each Option granted pursuant to the Plan shall, during Optionee's
lifetime, be exercisable only by Optionee, and neither the Option nor any right
thereunder shall be transferable by the Optionee by operation of law or
otherwise other than by will or the laws of descent and distribution, and shall
not be pledged or hypothecated (by operation of law or otherwise) or subject to
execution, attachment or similar processes.
16. USE OF PROCEEDS
The proceeds received by the Corporation from the sale of Stock pursuant
to Options granted under the Plan shall constitute general funds of the
Corporation.
17. ADOPTION, AMENDMENT, SUSPENSION AND TERMINATION
17.1. The Plan shall be effective as of the date of adoption by the
Board, subject to stockholders' approval of the Plan within one year of the
Effective Date by a majority of the votes cast at a duly held meeting of the
stockholders of the Corporation at which a quorum representing a majority of all
outstanding stock is present, either in person or by proxy, and voting on the
matter, or by written consent in accordance with applicable state law and the
Amended and Restated Articles of Incorporation and Amended and Restated Bylaws
of the
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Corporation and in a manner that satisfies the requirements of Rule 16b-3(b) of
the Exchange Act; provided, however, that upon approval of the Plan by the
stockholders of the Corporation, all Options granted under the Plan on or after
the Effective Date shall be fully effective as if the stockholders of the
Corporation had approved the Plan on the Effective Date. If the stockholders
fail to approve the Plan within one year of the Effective Date, any Options
granted hereunder shall be null, void and of no effect.
17.2. Subject to the limitation of Section 17.4 hereof, the Board may at
any time suspend or terminate the Plan, and may amend it from time to time in
such respects as the Board may deem advisable; provided, however, the Board
shall not amend the Plan in the following respects without the approval of
stockholders then sufficient to approve the Plan in the first instance:
(a) To materially increase the benefits provided under the Plan;
(b) To increase the maximum number of shares which may be granted;
(c) To change the designation or class of persons eligible to receive
Options under the Plan.
17.3. No Option may be granted during any suspension or after the
termination of the Plan, and no amendment, suspension or termination of the Plan
shall, without the Optionee's consent, alter or impair any rights or obligations
under any Stock Option Agreement previously entered into under the Plan. The
Plan shall terminate ten years after the Effective Date unless previously
terminated pursuant to Section 4.2 hereof or by the Board pursuant to this
Section 17.
17.4. Notwithstanding the provisions of Section 17.2 hereof, the Plan
shall not be amended more than once in any six-month period other than to
comport with changes in the Code, the Employee Retirement Income Security Act of
1974, or the rules promulgated thereunder.
18. SECURITIES LAWS
18.1. The Corporation shall not be required to sell or issue any shares
of Stock under any Option if the sale or issuance of such shares would
constitute a violation by the individual exercising the Option or the
Corporation of any provisions of any law or regulation of any governmental
authority, including without limitation any federal or state securities laws or
regulations. Specifically in connection with the Securities Act, upon exercise
of any Option, unless a registration statement under the Securities Act is in
effect with respect to the shares of Stock covered by such Option, the
Corporation shall not be required to sell or issue such shares unless the
Administrator has received evidence satisfactory to the Administrator that the
holder of such Option may acquire such shares pursuant to an exemption from
registration under the Securities Act. Any determination in this connection by
the Administrator shall be final and conclusive. The Corporation may, but shall
in no event be obligated to, register any securities covered hereby pursuant to
the Securities Act. The Corporation shall not be obligated to take any
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. As to any jurisdiction that expressly imposes the
requirement that an Option shall not be exercisable unless and until the shares
of Stock covered by such Option are registered or are subject to an available
exemption from registration, the exercise of such Option (under circumstances in
which the laws of such jurisdiction apply) shall be deemed conditioned upon the
effectiveness of such registration or the availability of such an exemption.
18.2. The intent of the Plan is to qualify for the exemption provided by
Rule 16b-3 under the Exchange Act. To the extent any provision of the Plan does
not comply with the
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requirements of Rule 16b-3, it shall be deemed inoperative and shall not affect
the validity of the Plan. In the event Rule 16b-3 is revised or replaced, the
Administrator may exercise discretion to modify the Plan in any respect
necessary to satisfy the requirements of the revised exemption or its
replacement.
19. INDEMNIFICATION
19.1. To the extent permitted by applicable law, the Administrator shall
be indemnified and held harmless by the Corporation against and from any and all
loss, cost, liability or expense that may be imposed upon or reasonably incurred
by the Administrator in connection with or resulting from any claim, action,
suit or proceeding to which the Administrator may be a party or in which the
Administrator may be involved by reason of any action taken or failure to act
under the Plan, and against and from any and all amounts paid by the
Administrator (with the Corporation's written approval) in the settlement
thereof, or paid by the Administrator in satisfaction of a judgment in any such
action, suit or proceeding except a judgment in favor of the Corporation;
subject, however, to the conditions that upon the institution of any claim,
action, suit or proceeding against the Administrator, the Administrator shall
give the Corporation an opportunity in writing, at its own expense, to handle
and defend the same before the Administrator undertakes to handle and defend it
on the Administrator's own behalf. The foregoing right of indemnification shall
not be exclusive of any other right to which such person may be entitled as a
matter of law or otherwise, or any power the Corporation may have to indemnify
the Administrator or hold the Administrator harmless.
19.2. The Administrator and each officer and employee of the Corporation
shall be fully justified in reasonably relying or acting upon any information
furnished in connection with the administration of the Plan by the Corporation
or any employee of the Corporation. In no event shall any person who is or shall
have been the Administrator, or an officer or employee of the Corporation, be
liable for any determination made or other action taken or any omission to act
in reliance upon any such information, or for any action (including furnishing
of information) taken or any failure to act, if in good faith.
20. GOVERNING LAW
The validity, interpretation and effect of the Plan, and the rights of
all persons hereunder, shall be governed by and determined in accordance with
the laws of Virginia, other than the choice of law rules thereof.
The Plan was duly adopted and approved by the Board on August 30, 1995,
and was duly approved by the stockholders of the Corporation on August 14, 1996.
/s/ Marilynn D. Bersoff
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Marilynn D. Bersoff
Secretary
The amended Plan was duly adopted and approved by the Board on December
17, 1998, and was duly approved by the stockholders of the Corporation on
September 9, 1999.
/s/ Marilynn D. Bersoff
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Marilynn D. Bersoff
Secretary
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