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EXHIBIT 10.12
AMENDED AND RESTATED
ANICOM, INC.
1995 DIRECTORS STOCK OPTION PLAN
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AMENDED AND RESTATED
ANICOM, INC.
1995 DIRECTORS STOCK OPTION PLAN
TABLE OF CONTENTS
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ARTICLE I
ESTABLISHMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
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1.1 Purpose. . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.1 "Affiliate" . . . . . . . . . . . . . . . . . . . . . 1
2.2 "Agreement" or "Award Agreement" . . . . . . . . . . . 1
2.3 "Anixter Family" . . . . . . . . . . . . . . . . . . . 2
2.4 "Board of Directors" or "Board" . . . . . . . . . . . . 2
2.5 "Cause" . . . . . . . . . . . . . . . . . . . . . . . . 2
2.6 "Change in Control" . . . . . . . . . . . . . . . . . 2
2.7 "Code" or "Internal Revenue Code" . . . . . . . . . . 2
2.8 "Commission" . . . . . . . . . . . . . . . . . . . . . 2
2.9 "Committee" . . . . . . . . . . . . . . . . . . . . . . 2
2.10 "Common Stock" . . . . . . . . . . . . . . . . . . . . 2
2.11 "Company" . . . . . . . . . . . . . . . . . . . . . . . 2
2.12 "Director" . . . . . . . . . . . . . . . . . . . . . . 3
2.13 "Disability" . . . . . . . . . . . . . . . . . . . . . 3
2.14 "Disinterested Person" . . . . . . . . . . . . . . . . 3
2.15 "Effective Date" . . . . . . . . . . . . . . . . . . . 3
2.16 "Exchange Act" . . . . . . . . . . . . . . . . . . . . 3
2.17 "Fair Market Value" . . . . . . . . . . . . . . . . . . 3
2.18 "Grant Date" . . . . . . . . . . . . . . . . . . . . . 4
2.19 "Initial Grant Date" . . . . . . . . . . . . . . . . . 4
2.20 "Nonqualified Option" . . . . . . . . . . . . . . . . . 4
2.21 "Option" . . . . . . . . . . . . . . . . . . . . . . . 4
2.22 "Option Period" . . . . . . . . . . . . . . . . . . . . 4
2.23 "Option Price" . . . . . . . . . . . . . . . . . . . . 4
2.24 "Participant" . . . . . . . . . . . . . . . . . . . . . 4
2.25 "Plan" . . . . . . . . . . . . . . . . . . . . . . . . 4
2.26 "Public Offering" . . . . . . . . . . . . . . . . . . . 4
2.27 "Representative" . . . . . . . . . . . . . . . . . . . 4
2.28 "Rule 16b-3" . . . . . . . . . . . . . . . . . . . . . 4
2.29 "Securities Act" . . . . . . . . . . . . . . . . . . . 5
2.30 "Termination of Directorship" . . . . . . . . . . . . . 5
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ARTICLE III
ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1 Committee Structure and Authority . . . . . . . . . . 5
ARTICLE IV
STOCK SUBJECT TO PLAN . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.1 Number of Shares . . . . . . . . . . . . . . . . . . 7
4.2 Release of Shares . . . . . . . . . . . . . . . . . . 7
4.3 Restrictions on Shares . . . . . . . . . . . . . . . 7
4.4 Shareholder Rights . . . . . . . . . . . . . . . . . 8
4.5 Reasonable Efforts To Register . . . . . . . . . . . 8
4.6 Anti-Dilution . . . . . . . . . . . . . . . . . . . . 8
ARTICLE V
OPTION GRANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
5.1 Eligibility . . . . . . . . . . . . . . . . . . . . . 9
5.2 Grant and Exercise . . . . . . . . . . . . . . . . . 9
5.3 Terms and Conditions . . . . . . . . . . . . . . . . 9
5.4 Termination by Reason of Death . . . . . . . . . . . 10
5.5 Termination by Reason of Disability . . . . . . . . . 10
5.6 Other Termination . . . . . . . . . . . . . . . . . . 11
5.7 Cashing Out of Option . . . . . . . . . . . . . . . . 11
ARTICLE VI
PROVISIONS APPLICABLE TO STOCK ACQUIRED UNDER THE PLAN . . . . . . . . 11
6.1 Transfer of Shares . . . . . . . . . . . . . . . . . 11
6.2 Limited Transfer During Offering . . . . . . . . . . 11
6.3 Committee Discretion . . . . . . . . . . . . . . . . 11
6.4 No Company Obligation . . . . . . . . . . . . . . . . 12
ARTICLE VII
CHANGE IN CONTROL PROVISIONS . . . . . . . . . . . . . . . . . . . . . 12
7.1 Impact of Event . . . . . . . . . . . . . . . . . . . 12
7.2 Definition of Change in Control . . . . . . . . . . . 12
ARTICLE VIII
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
8.1 Amendments and Termination . . . . . . . . . . . . . 13
8.2 Unfunded Status of Plan . . . . . . . . . . . . . . . 13
8.3 General Provisions . . . . . . . . . . . . . . . . . 14
8.4 Mitigation of Excise Tax . . . . . . . . . . . . . . 15
8.5 Options in Substitution for Options Granted by Other
Corporations . . . . . . . . . . . . . . . . . . . . 15
8.6 Procedure for Adoption . . . . . . . . . . . . . . . 15
8.7 Procedure for Withdrawal . . . . . . . . . . . . . . 15
8.8 Delay . . . . . . . . . . . . . . . . . . . . . . . . 15
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8.9 Headings . . . . . . . . . . . . . . . . . . . . . . 16
8.10 Severability . . . . . . . . . . . . . . . . . . . . 16
8.11 Successors and Assigns . . . . . . . . . . . . . . . 16
8.12 No Obligation to Give Notice . . . . . . . . . . . . 16
8.13 No Third Party Beneficiaries . . . . . . . . . . . . 16
8.14 Entire Agreement . . . . . . . . . . . . . . . . . . 17
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AMENDED AND RESTATED
ANICOM, INC.
1995 DIRECTORS STOCK OPTION PLAN
ARTICLE I
ESTABLISHMENT
1.1 Purpose.
The Anicom, Inc. 1995 Directors Stock Option Plan (the "Plan") was
previously established by Anicom, Inc. (the "Company") effective as of January
20, 1995. The Plan is hereby amended and restated in its entirety effective as
of May 23, 1996. The purpose of the Plan is to promote the overall financial
objectives of the Company and its stockholders by motivating directors of the
Company who are not employees to achieve long-term growth in shareholder equity
in the Company and to retain the association of those individuals. The Plan's
amendment and restatement and the grant of awards thereunder is expressly
conditioned upon the Plan's approval by the Company's stockholders to the
extent required by Rule 16b-3 of the Securities Exchange Act of 1934, as
amended. If such approval is not obtained on or before July 31, 1997, then the
Plan, as amended and restated, and all Awards thereunder to the extent affected
by the amendment and restatement shall be null and void ab initio, in which
case, the Plan shall continue in full force and effect as originally approved
by the stockholders of the Company.
ARTICLE II
DEFINITIONS
For purposes of the Plan, the following terms are defined as set forth
below:
2.1 "Affiliate" means any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated association or other
entity (other than the Company) that directly, or indirectly through one or
more intermediaries, controls, is controlled by, or is under common control
with, the Company including, without limitation, any member of an affiliated
group of which the Company is a common parent corporation as provided in
Section 1504 of the Code.
2.2 "Agreement" or "Award Agreement" means, individually or
collectively, any agreement entered into pursuant to the Plan pursuant to which
an Option is granted to a Participant.
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2.3 "Anixter Family" means Alan B. Anixter, William R. Anixter,
Scott C. Anixter, their spouses, heirs and any group (within the meaning of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), of which any of the foregoing persons is a member for purposes
of acquiring, holding or disposing of securities of the Company, any trust
established by or for the benefit of any of the foregoing and any other entity
controlled by or for the benefit of any of the foregoing.
2.4 "Board of Directors" or "Board" means the Board of Directors
of the Company.
2.5 "Cause" shall mean, for purposes of whether and when a
Participant has incurred a Termination of Employment for Cause, any act or
omission which permits the Company to terminate the written agreement or
arrangement between the Participant and the Company or an Affiliate for Cause
as defined in such agreement or arrangement, or in the event there is no such
agreement or arrangement or the agreement or arrangement does not define the
term "cause," then Cause shall mean (a) an act of fraud or dishonesty by
Participant that results in gain or personal enrichment of Participant at the
Company's expense, (b) Participant's conviction of a felony-class crime or any
act involving moral turpitude, (c) any material breach by Participant of any
provision of this Agreement that has not been cured by Participant within
thirty days of written notice of such breach from the Company, (d) the
Participant's willful engaging in gross misconduct materially injurious to the
Company that has not been cured by Participant within thirty days of written
notice specifying the alleged willful gross misconduct and material injury, or
(e) any intentional act or gross negligence by Participant that has a material,
detrimental effect on the reputation or business of the Company.
2.6 "Change in Control" has the meaning set forth in SECTION 7.2.
2.7 "Code" or "Internal Revenue Code" means the Internal Revenue
Code of 1986, as amended, final Treasury Regulations thereunder and any
subsequent Internal Revenue Code.
2.8 "Commission" means the Securities and Exchange Commission or
any successor agency.
2.9 "Committee" means the person or persons appointed by the Board
of Directors to administer the Plan, as further described in the Plan.
Initially, the Committee shall consist of Scott C. Anixter and Alan B. Anixter.
2.10 "Common Stock" means the shares of Common Stock, $.001 par
value, whether presently or hereafter issued, and any other stock or security
resulting from adjustment thereof as described hereinafter or the common stock
of any successor to the Company which is designated for the purpose of the
Plan.
2.11 "Company" means Anicom, Inc., a Delaware corporation, and
includes any successor or assignee corporation or corporations into which the
Company may be merged, changed or consolidated; any corporation for whose
securities the securities of the Company shall be exchanged; and any assignee
of or successor to substantially all of the assets of the Company.
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2.12 "Director" means each and any director who serves on the Board
and who is not an officer or employee of the Company or any of its Affiliates.
2.13 "Disability" means a mental or physical illness, injury, or
infirmity that prevents Participant from fulfilling his or her duties for the
Company or an Affiliate for a period of sixty (60) consecutive days in the
manner ordinarily required of him or her. Notwithstanding the foregoing, a
Disability shall not qualify under the Plan if it is the result of (i) a
willfully self-inflicted injury or willfully self-induced sickness; or (ii) an
injury or disease contracted, suffered, or incurred, while participating in a
criminal offense. The determination of Disability shall be made by the
Committee. The determination of Disability for purposes of the Plan shall not
be construed to be an admission of disability for any other purpose.
2.14 "Disinterested Person" shall have the meaning set forth in
Rule 16b-3, or any successor definition adopted by the Commission and shall
mean a person is also an "outside director" under Section 162(m) of the Code.
2.15 "Effective Date" means the date on which the Plan is approved
by the Company's stockholders to the extent required by Rule 16b-3.
2.16 "Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
2.17 "Fair Market Value" means the value of the Common Stock
determined on the basis of the good faith determination of the Committee,
without regard to whether the Common Stock is restricted or represents a
minority interest, pursuant to the applicable method described below:
(a) if the Common Stock is listed on a national
securities exchange or quoted on The Nasdaq Stock Market (either the
Nasdaq Stock Market or the Nasdaq Small Cap Market (in either case,
("NASDAQ")), the closing price of the Common Stock on the relevant
date (or, if such date is not a business day or a day on which
quotations are reported, then on the immediately preceding date on
which quotations were reported), as reported by the principal national
exchange on which such shares are traded (in the case of an exchange)
or by the NASDAQ, as the case may be;
(b) if the Common Stock is not listed on a national
securities exchange or quoted on the NASDAQ, but is actively traded in
the over-the-counter market, the average of the closing bid and asked
prices for the Common Stock on the relevant date (or, if such date is
not a business day or a day on which quotations are reported, then on
the immediately preceding date on which quotations were reported), or
the most recent preceding date for which such quotations are reported;
and
(c) if, on the relevant date, the Common Stock is not
publicly traded or reported as described in (a) or (b), the value
determined in good faith by the Committee.
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2.18 "Grant Date" means the date that as of which an Option is
granted pursuant to the Plan.
2.19 "Initial Grant Date" means the date that as of which an Option
is initially granted pursuant to the Plan. Unless otherwise designated, the
Initial Grant Date is the date on which a director takes office.
2.20 "Nonqualified Option" means an Option granted under the Plan
other than an incentive stock option within the meaning of Section 422 of the
Code.
2.21 "Option" means the right to purchase the number of shares of
Common Stock specified by the Plan at a price and for a term fixed by the Plan,
and subject to such other limitations and restrictions as the Plan and the
Committee imposes.
2.22 "Option Period" means the period during which the Option shall
be exercisable in accordance with the Agreement and the Plan.
2.23 "Option Price" means the price at which the Common Stock may
be purchased under an Option as provided in SECTION 5.3.
2.24 "Participant" means a Director to whom an Option has been
granted, under the Plan, and in the event a person becomes a Representative,
then the term "Participant" shall mean such Representative. For purposes of
this Agreement, the term "Termination of Directorship" shall be deemed to be
binding on a Representative of the Director.
2.25 "Plan" means the Anicom, Inc. 1995 Directors Stock Option
Plan, as herein set forth and as may be amended from time to time.
2.26 "Public Offering" means an initial public offering of shares
of Common Stock under the Securities Act.
2.27 "Representative" means (a) the person or entity acting as the
executor or administrator of a Participant's estate pursuant to the last will
and testament of a Participant or pursuant to the laws of the jurisdiction in
which the Participant had the Participant's primary residence at the date of
the Participant's death; (b) the person or entity acting as the guardian or
temporary guardian of a Participant; (c) the person or entity which is the
beneficiary of the Participant upon or following the Participant's death; or
(d) any person to whom an Option has been permissibly transferred including,
without limitation, a trust for the benefit of the Participant, the
Participant's parents, spouse or descendants, or a custodian under a uniform
gifts to minors act or similar statute for the benefit of the Participant's
descendants, to the extent permitted by the Committee and not inconsistent with
the Rule 16b-3; provided that only one of the foregoing shall be the
Representative at any point in time as determined under applicable law and
recognized by the Committee.
2.28 "Rule 16b-3" means Rule 16b-3, as promulgated under the
Exchange Act, as amended from time to time, or any successor thereto.
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2.29 "Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
2.30 "Termination of Directorship" means the occurrence of any act
or event that results in the person's ceasing, for whatever reason, to be a
Director of the Company or of any Affiliate, including, without limitation,
death, Disability, dismissal, severance at the election of the Participant,
retirement, or severance as a result of the discontinuance, liquidation, sale
or transfer by the Company or its Affiliates of all businesses owned or
operated by the Company or its Affiliates.
In addition, certain other terms used herein have definitions given to
them in the first place in which they are used.
ARTICLE III
ADMINISTRATION
3.1 Committee Structure and Authority. The Plan shall be
administered by the Committee which, except as provided herein, may be
comprised of one or more persons. The Committee shall be a committee of the
Board of Directors, unless such committee does not exist or the Board
establishes a committee whose sole purpose is the administration of the Plan;
provided that only those members of the Committee of the Board who participate
in the decision relative to Options under the Plan shall be deemed to be part
of the "Committee" for purposes of the Plan. In the absence of an appointment,
the Board or the portion thereof that are Disinterested Persons shall be the
Committee. A majority of the Committee shall constitute a quorum at any
meeting thereof (including telephone conference) and the acts of a majority of
the members present, or acts approved in writing by a majority of the entire
Committee without a meeting, shall be the acts of the Committee for purposes of
the Plan. The Committee may authorize any one or more of its members or an
officer of the Company to execute and deliver documents on behalf of the
Committee. The Committee shall include no less than the number of
Disinterested Persons required for application of Rule 16b-3. No member of the
Committee shall exercise any discretion respecting himself or herself under the
Plan. The Board shall have the authority to remove, replace or fill any
vacancy of any member of the Committee upon notice to the Committee and the
affected member. Any member of the Committee may resign upon notice to the
Board. The Committee may allocate among one or more of its members, or may
delegate to one or more of its agents, such duties and responsibilities as it
determines.
Among other things, the Committee shall have the authority, subject to
the terms of the Plan and the limitation of section (c)(2)(ii) of Rule 16b-3 so
that the Plan is described in that section:
(a) to determine the terms and conditions of any Option
hereunder (including, but not limited to, the Option Period, any
exercise restriction or limitation and any exercise acceleration or
forfeiture waiver regarding any Option and the shares of Common Stock
relating thereto);
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(b) to adjust the terms and conditions, at any time or
from time to time, of any Option, subject to the limitations of
SECTION 8.1;
(c) to provide for the forms of Agreement to be utilized
in connection with the Plan;
(d) to determine whether a Participant has a Disability
or is in retirement;
(e) to determine what securities law requirements are
applicable to the Plan, Options, and the issuance of shares of Common
Stock and to require of a Participant that appropriate action be taken
with respect to such requirements;
(f) to cancel, with the consent of the Participant or as
otherwise provided in the Plan or an Agreement, outstanding Options;
(g) to require as a condition of the exercise of an
Option or the issuance or transfer of a certificate of Common Stock,
the withholding from a Participant of the amount of any federal, state
or local taxes as may be necessary in order for the Company or any
other employer to obtain a deduction or as may be otherwise required
by law;
(h) to determine whether and with what effect an
individual has incurred a Termination of Directorship;
(i) to determine whether the Company or any other person
has a right or obligation to purchase Common Stock from a Participant
and, if so, the terms and conditions on which such Common Stock is to
be purchased;
(j) to determine the restrictions or limitations on the
transfer of Common Stock;
(k) to determine whether an Option is to be adjusted,
modified or purchased, or is to become fully exercisable, under the
Plan or the terms of an Agreement;
(l) to interpret and make a final determination with
respect to the remaining number of shares of Common Stock available
under the Plan;
(m) to determine the permissible methods of Option
exercise and payment, including cashless exercise arrangements;
(n) to adopt, amend and rescind such rules and
regulations as, in its opinion, may be advisable in the administration
of the Plan; and
(o) to appoint and compensate agents, counsel, auditors
or other specialists to aid it in the discharge of its duties.
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The Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms and provisions of the
Plan and any Option issued under the Plan (and any Agreement) and to otherwise
supervise the administration of the Plan. The Committee's policies and
procedures may differ with respect to Options granted at different times or to
different Participants.
Any determination made by the Committee pursuant to the provisions of
the Plan shall be made in its sole discretion, and in the case of any
determination relating to an Option, may be made at the time of the grant of
the Option or, unless in contravention of any express term of the Plan or an
Agreement, at any time thereafter. All decisions made by the Committee
pursuant to the provisions of the Plan shall be final and binding on all
persons, including the Company and Participants. Any determination shall not
be subject to de novo review if challenged in court.
ARTICLE IV
STOCK SUBJECT TO PLAN
4.1 Number of Shares. Subject to adjustment under SECTION 4.6,
the total number of shares of Common Stock reserved and available for
distribution pursuant to Options under the Plan shall be 100,000 shares of
Common Stock authorized for issuance on the Effective Date. Such shares may
consist, in whole or in part, of authorized and unissued shares or treasury
shares.
4.2 Release of Shares. If any shares of Common Stock that have
been optioned cease to be subject to an Option, if any shares of Common Stock
that are subject to any Option are forfeited, if any Option otherwise
terminates without issuance of shares of Common Stock being made to the
Participant, such shares, or if any shares (whether or not restricted) of
Common Stock that were previously issued under the Plan are received by the
Company in connection with the exercise of an Award, such shares, in the
discretion of the Committee, may again be available for distribution in
connection with Options under the Plan.
4.3 Restrictions on Shares. Shares of Common Stock issued upon
exercise of an Option shall be subject to the terms and conditions specified
herein and to such other terms, conditions and restrictions as the Committee in
its discretion may determine or provide in the Option Agreement. The Company
shall not be required to issue or deliver any certificates for shares of Common
Stock, cash or other property prior to (i) the listing of such shares on any
stock exchange (or other public market) on which the Common Stock may then be
listed (or regularly traded), (ii) the completion of any registration or
qualification of such shares under federal or state law, or any ruling or
regulation of any government body which the Committee determines to be
necessary or advisable, and (iii) the satisfaction of any applicable
withholding obligation in order for the Company or an Affiliate to obtain a
deduction with respect to the exercise of an Option. The Company may cause any
certificate for any share of Common Stock to be delivered to be properly marked
with a legend or other notation reflecting the limitations
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on transfer of such Common Stock as provided in the Plan or as the Committee
may otherwise require. The Committee may require any person exercising an
Option to make such representations and furnish such information as it may
consider appropriate in connection with the issuance or delivery of the shares
of Common Stock in compliance with applicable law or otherwise. Fractional
shares shall not be delivered, but shall be rounded to the next lower whole
number of shares.
4.4 Shareholder Rights. No person shall have any rights of a
shareholder as to shares of Common Stock subject to an Option until, after
proper exercise of the Option or other action required, such shares shall have
been recorded on the Company's official shareholder records as having been
issued or transferred. Upon exercise of the Option or any portion thereof, the
Company will have thirty (30) days in which to issue the shares, and the
Participant will not be treated as a shareholder for any purpose whatsoever
prior to such issuance. No adjustment shall be made for cash dividends or
other rights for which the record date is prior to the date such shares are
recorded as issued or transferred in the Company's official shareholder
records, except as provided herein or in an Agreement.
4.5 Reasonable Efforts To Register. If there has been a Public
Offering, the Company intends to register under the Securities Act the Common
Stock delivered or deliverable pursuant to Options on Form S-8 if available to
the Company for this purpose (or any successor or alternate form that is
substantially similar to that form to the extent available to effect such
registration), in accordance with the rules and regulations governing such
forms. If the Committee deems registration to be in the Company's best
interests, the Company will use efforts to cause the registration statement to
become effective and will file such supplements and amendments to the
registration statement as may be necessary to keep the registration statement
in effect until the earliest of (a) one year following the expiration of the
Option Period of the last Option outstanding, (b) the date the Company is no
longer a reporting company under the Exchange Act and (c) the date all
Participants have disposed of all shares delivered pursuant to any Option. The
Company may delay the foregoing obligation if the Committee reasonably
determines that any such registration is not in the Company's best interests or
if there is no material benefit to Participants in the Plan.
4.6 Anti-Dilution. In the event of any Company stock dividend,
stock split, combination or exchange of shares, recapitalization or other
change in the capital structure of the Company, corporate separation or
division of the Company (including, but not limited to, a split-up, spin-off,
split-off or distribution to Company shareholders other than a normal cash
dividend), sale by the Company of all or a substantial portion of its assets
(measured on either a stand-alone or consolidated basis), reorganization,
rights offering, a partial or complete liquidation, or any other corporate
transaction, Company share offering or event involving the Company and having
an effect similar to any of the foregoing, then the Committee shall adjust or
substitute, as the case may be, the number of shares of Common Stock available
for Options under the Plan, the number of shares of Common Stock covered by
outstanding Options, the exercise price per share of outstanding Options, and
any other characteristics or terms of the Options as the Committee shall deem
necessary or appropriate to reflect equitably the effects of such changes to
the Participants; provided, however, that any fractional shares resulting from
such adjustment shall be eliminated by rounding to the next lower whole number
of shares with
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appropriate payment for such fractional share as shall reasonably be determined
by the Committee.
ARTICLE V
OPTION GRANTS
5.1 Eligibility. Each Director shall be granted Options to
purchase shares of Common Stock as provided herein.
5.2 Grant and Exercise. Each Director who is a Director on the
Effective Date shall be granted an Option on such date to purchase 5,000 shares
of Common Stock without further action by the Board or the Committee. Each
Director who joins the Board after the Effective Date shall be granted an
Option on the Initial Grant Date to purchase 5,000 shares of Common Stock
without further action by the Board or the Committee. On the date of the
Company's annual meeting of stockholders in the calendar year following the
Effective Date and on the date of each annual meeting of stockholders
thereafter, each such Director who is still a Director on such anniversary date
shall be granted an additional Option to purchase 5,000 shares of Common Stock
without further action by the Board or the Committee; provided that the total
number of shares for which Options have been granted to a Director under this
Plan shall not exceed 25,000 shares.
If the number of shares of Common Stock available to grant under the
Plan on a scheduled date of grant is insufficient to make all automatic grants
required to be made pursuant to the Plan on such date, then each eligible
Director shall receive an Option to purchase a pro rata number of the remaining
shares of Common Stock available under the Plan; provided further, however,
that if such proration results in fractional shares of Common Stock, then such
Option shall be rounded down to the nearest number of whole shares of Common
Stock. In all events, the Option Price shall be the Fair Market Value per
share on the date the Option is granted. Each Option granted under the Plan
shall be evidenced by an Agreement, in a form approved by the Committee, which
shall embody the terms and conditions of such Option and which shall be subject
to the express terms and conditions set forth in the Plan. Such Agreement
shall become effective upon execution by the Participant.
5.3 Terms and Conditions. Options shall be subject to such terms
and conditions as shall be determined by the Committee, including the
following:
(a) Option Period. The Option Period of each Option
shall be seven (7) years.
(b) Exercisability. Subject to SECTION 7.1, Options
shall be exercisable at such time or times and subject to such terms
and conditions as shall be determined by the Committee. If the
Committee provides that any Option is exercisable only in
installments, the Committee may at any time waive such installment
exercise provisions, in whole or in part. In addition, the Committee
may at any time accelerate the exercisability of any Option.
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(c) Method of Exercise. Subject to the provisions of
this Article V and an Agreement, a Participant may exercise Options,
in whole or in part, at any time during the Option Period by the
Participant's giving written notice of exercise on a form provided by
the Committee to the Company specifying the number of shares of Common
Stock subject to the Option to be purchased. Such notice shall be
accompanied by payment in full of the purchase price by cash or check
or such other form of payment as the Company may accept. If approved
by the Committee, payment in full or in part may also be made (i) by
delivering Common Stock already owned by the Participant having a
total Fair Market Value on the date of such delivery equal to the
Option Price; (ii) by the execution and delivery of a note or other
evidence of indebtedness (and any security agreement thereunder)
satisfactory to the Committee and permitted in accordance with SECTION
5.3(E); (iii) by authorizing the Company to retain shares of Common
Stock which would otherwise be issuable upon exercise of the Option
having a total Fair Market Value on the date of delivery equal to the
Option Price; (iv) by the delivery of cash or the extension of credit
by a broker-dealer to whom the Participant has submitted a notice of
exercise or otherwise indicated an intent to exercise an Option (in
accordance with Part 220, Chapter II, Title 12 of the Code of Federal
Regulations, a so-called "cashless" exercise); or (v) by any
combination of the foregoing. No shares of Common Stock shall be
issued until full payment therefor has been made.
(d) Non-transferability of Options. Except as provided
herein or in an Agreement, no Option shall be transferable by the
Participant other than by will or by the laws of descent and
distribution, and all Options shall be exercisable during the
Participant's lifetime only by the Participant. If and to the extent
permitted by Rule 16b-3 and except as otherwise provided herein or by
an Agreement, every Option granted hereunder shall be freely
transferable, but only if such transfer is exempt under Rule 16b-3 or
is the Committee adopts Securities Exchange Act Release 34-28869 of
the Securities Exchange Commission the Committee may permit an Option
to be transferred pursuant to a domestic relations order which would
be a "qualified domestic relations order" as defined in Section 414 of
the Code if such section applied to the Option.
5.4 Termination by Reason of Death. Unless otherwise provided in
an Agreement or determined by the Committee, if a Participant incurs a
Termination of Directorship due to death, any vested, unexpired and unexercised
Options held by such Participant shall thereafter be fully exercisable for a
period of one (1) year (or such other period or no period as the Committee may
specify) immediately following the date of such death or until the expiration
of the Option Period, whichever period is the shorter.
5.5 Termination by Reason of Disability. Unless otherwise
provided in an Agreement or determined by the Board, if a Participant incurs a
Termination of Directorship due to a Disability, any vested, unexpired and
unexercised Options held by such Participant shall thereafter be fully
exercisable by the Participant for the period of one (1) year (or such other
period or no period as the Committee may specify) immediately following the
date of such Termination of Directorship or until the expiration of the Option
Period, whichever period is shorter, and the Participant's death at any time
following such Termination of Directorship due to Disability shall not affect
the foregoing.
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5.6 Other Termination. Unless otherwise provided in an Agreement
or determined by the Committee, if a Participant incurs a Termination of
Directorship by the Company for Cause, any vested, unexpired and unexercised
Stock Option held by such Participant shall terminate immediately upon notice
of termination by the Company. The death or Disability of a Participant after
a Termination of Directorship otherwise provided herein shall not extend the
exercisability of the time permitted to exercise an Option.
5.7 Cashing Out of Option. On receipt of written notice of
exercise, the Committee may elect to cash out all or part of the portion of any
Option for which at least six months has elapsed since the Grant Date (provided
that such limitation shall not apply to an Option granted to a Participant who
has subsequently died) to be exercised by paying the Participant an amount, in
cash or Common Stock, equal to the excess of the Fair Market Value of the
Common Stock that is subject to the Option over the Option Price times the
number of shares of Common Stock subject to the Option on the effective date of
such cash out. Cash outs relating to Options held by Participants who are
actually or potentially subject to Section 16(b) of the Exchange Act shall
comply with the "window period" provisions of Rule 16b-3, to the extent
applicable, and, Fair Market Value shall be determined in accordance with the
definition set forth in SECTION 2.16.
ARTICLE VI
PROVISIONS APPLICABLE TO STOCK ACQUIRED UNDER THE PLAN
6.1 Transfer of Shares. A Participant may at any time make a
transfer of shares of Common Stock received pursuant to the exercise of an
Option to his parents, spouse or descendants or to any trust for the benefit of
the foregoing or to a custodian under a uniform gifts to minors act or similar
statute for the benefit of any of the Participant's descendants. Any transfer
of shares received pursuant to the exercise of an Option shall not be permitted
or valid unless and until the transferee agrees to be bound by the provisions
of the Plan, and any provision respecting Common Stock under the Agreement,
provided that "Termination of Directorship" shall continue to refer to the
Termination of the Directorship of the Participant.
6.2 Limited Transfer During Offering. In the event there is an
effective registration statement under the Securities Act pursuant to which
shares of Common Stock shall be offered for sale in an underwritten offering, a
Participant shall not, during the period requested by the underwriters
managing the registered public offering, effect any public sale or distribution
of shares received directly or indirectly pursuant to an exercise of an Option.
6.3 Committee Discretion. The Committee may in its sole
discretion include in any Agreement an obligation that the Company purchase a
Participant's shares of Common Stock received upon the exercise of an Option
(including the purchase of any unexercised Options which have not expired), or
may obligate a Participant to sell shares of Common Stock to the Company upon
such terms and conditions as the Committee may determine and set forth in an
Agreement. The provisions of this Article VI shall be construed by the
Committee in its sole discretion, and shall be subject to such other terms and
conditions as the Committee may from time to time determine.
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6.4 No Company Obligation. None of the Company, an Affiliate or
the Committee shall have any duty or obligation to affirmatively disclose
material information regarding the Company to a record or beneficial holder of
Common Stock or an Option, and such holder shall have no right to be advised of
any material information regarding the Company or any Affiliate at any time
prior to, upon or in connection with receipt or the exercise of an Option or
the Company's purchase of Common Stock in accordance with the terms hereof.
ARTICLE VII
CHANGE IN CONTROL PROVISIONS
7.1 Impact of Event. Notwithstanding any other provision of the
Plan to the contrary, in the event of a Change in Control (as defined in
SECTION 7.2), any Options outstanding as of the date such Change in Control and
not then exercisable shall become fully exercisable to the full extent of the
original grant.
7.2 Definition of Change in Control. For purposes of the Plan, a
"Change in Control" shall mean the happening of any of the following events:
(a) An acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
"PERSON") of the beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of fifty percent (50%) or
more of the then outstanding shares of common stock of the Company
(the "OUTSTANDING COMPANY COMMON STOCK") or (ii) the approval by the
stockholders of the Company of a reorganization, merger,
consolidation, complete liquidation or dissolution of the Company, the
sale or disposition of all or substantially all of the assets of the
Company or similar corporate transaction (in each case referred to in
this SECTION 7.2(A) as a "CORPORATE TRANSACTION") or, if consummation
of such Corporate Transaction is subject, at the time of such approval
by stockholders, to the consent of any government or governmental
agency, the obtaining of such consent (either explicitly or
implicitly) provided such acquisition or beneficial ownership would
result in any other Person's beneficially owning fifty percent (50%)
or more of the Outstanding Company Common Stock; excluding, however,
the following: (A) any acquisition by the Company or by an employee
benefit plan (or related trust) sponsored or maintained by the Company
or an Affiliate, (B) any acquisition by a member of the Anixter
Family, or (C) any acquisition by or consummation of a Corporate
Transaction with an Affiliate.
(b) A change in the composition of the Board such that
the individuals who, as of the date of the Initial Public Offering
(the "PUBLIC OFFERING"), constitute the Board (such Board shall be
hereinafter referred to as the "INCUMBENT BOARD") cease for any reason
to constitute at least a majority of the Board; provided, however, for
purposes of this SECTION 7.2(B), that any individual who becomes a
member of the Board subsequent to the date of the Company's Public
Offering whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of those
individuals who are members of the Board and who were also members of
the Incumbent
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Board (or deemed to be such pursuant to this provision) shall be
considered as though such individual were a member of the Incumbent
Board; but, provided, further, that any such individual whose initial
assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board shall not be so considered as a member of
the Incumbent Board.
ARTICLE VIII
MISCELLANEOUS
8.1 Amendments and Termination. The Board may amend, alter, or
discontinue the Plan at any time, but no amendment, alteration or
discontinuation shall be made which would (a) impair the rights of a
Participant under an Option theretofore granted without the Participant's
consent, except such an amendment made to cause the Plan to qualify for the
exemption provided by Rule 16b-3 or (b) disqualify the Plan from the exemption
provided by Rule 16b-3. In addition, no such amendment shall be made without
the approval of the Company's shareholders to the extent such approval is
required by law or agreement. Notwithstanding the foregoing, the Plan may not
be amended more than once every six (6) months to change the Plan provisions
listed in section (c)(2)(ii)(A) of Rule 16b-3, other than to comport with
changes in the Code or Rule 16b- 3.
The Committee may amend the Plan at any time provided that (a) no
amendment shall impair the rights of any Participant under any Option
theretofore granted without the Participant's consent, (b) no amendment shall
disqualify the Plan from the exemption provided by Rule 16b-3, and (c) any
amendment shall be subject to the approval or rejection of the Board.
Notwithstanding the foregoing, the Plan may not be amended more than once every
six (6) months to change the Plan provisions listed in section (c)(2)(ii)(A) of
Rule 16b-3, other than to comport with changes in the Code or Rule 16b-3.
Subject to the above provisions, the Board shall have authority to
amend the Plan to take into account changes in law and tax and accounting
rules, as well as other developments and to grant Options which qualify for
beneficial treatment under such rules without shareholder approval.
8.2 Unfunded Status of Plan. It is intended that the Plan be an
"unfunded" plan for incentive and deferred compensation. The Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Common Stock or make payments; provided,
however, that, unless the Committee otherwise determines, the existence of such
trusts or other arrangements is consistent with the "unfunded" status of the
Plan.
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8.3 General Provisions.
(a) Representation. The Committee may require each
person purchasing or receiving shares pursuant to an Option to
represent to and agree with the Company in writing that such person is
acquiring the shares without a view to the distribution thereof. The
certificates for such shares may include any legend which the
Committee deems appropriate to reflect any restrictions on transfer.
(b) No Additional Obligation. Nothing contained in the
Plan shall prevent the Company or an Affiliate from adopting other or
additional compensation arrangements for its employees.
(c) Withholding. No later than the date as of which an
amount first becomes includible in the gross income of the Participant
for Federal income tax purposes with respect to any Option, the
Participant shall pay to the Company (or other entity identified by
the Committee), or make arrangements satisfactory to the Company or
other entity identified by the Committee regarding the payment of, any
Federal, state, local or foreign taxes of any kind required by law to
be withheld with respect to such amount required in order for the
Company or an Affiliate to obtain a current deduction. Unless
otherwise determined by the Committee, withholding obligations may be
settled with Common Stock, including Common Stock that is part of the
Option that gives rise to the withholding requirement provided that
any applicable requirements under Section 16 of the Exchange Act are
satisfied. The obligations of the Company under the Plan shall be
conditional on such payment or arrangements, and the Company and its
Affiliates shall, to the extent permitted by law, have the right to
deduct any such taxes from any payment otherwise due to the
Participant.
(d) Representation. The Committee shall establish such
procedures as it deems appropriate for a Participant to designate a
Representative to whom any amounts payable in the event of the
Participant's death are to be paid.
(e) Controlling Law. The Plan and all Options made and
actions taken thereunder shall be governed by and construed in
accordance with the laws of the State of Delaware (other than its law
respecting choice of law). The Plan shall be construed to comply with
all applicable law, and to avoid liability to the Company, an
Affiliate or a Participant, including, without limitation, liability
under Section 16(b) of the Exchange Act.
(f) Offset. Any amounts owed to the Company or an
Affiliate by the Participant of whatever nature may be offset by the
Company from the value of any shares of Common Stock, cash or other
thing of value under the Plan or an Agreement to be transferred to the
Participant, and no shares of Common Stock, cash or other thing of
value under the Plan or an Agreement shall be transferred unless and
until all disputes between the Company and the Participant have been
fully and finally resolved and the Participant has waived all claims
to such against the Company or an Affiliate.
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8.4 Mitigation of Excise Tax. If any payment or right accruing to
a Participant under the Plan (without the application of this SECTION 8.4),
either alone or together with other payments or rights accruing to the
Participant from the Company or an Affiliate ("Total Payments") would
constitute a "parachute payment" (as defined in Section 280G of the Code and
regulations thereunder) that is subject to the excise tax imposed by Section
4999 of the Code (or similar tax and/or assessment), the Company (or its
successor or assigns) shall increase the amounts payable hereunder to the
extent necessary to place Participant in the same after-tax position as he or
she would have been in had no such excise tax been imposed on the payments
hereunder. The determination of the amount of any such excise taxes shall
initially be made by an independent accounting firm employed by the Company.
The Participant shall cooperate in good faith with the Committee in making such
determination and providing the necessary information for this purpose. If, at
a later date, it is determined that the amount of excise taxes payable by
Participant is greater than the amount initially so determined, then the
Company (or its successor or assigns) shall pay Participant an amount equal to
the sum of (i) such additional excise taxes, (ii) any interest, fines and
penalties resulting from such underpayment, plus (iii) an amount necessary to
reimburse Participant for any income, excise or other taxes payable by
Participant with respect to the amount specified in (i) and (ii) above, and the
reimbursement provided by this (iii).
8.5 Options in Substitution for Options Granted by Other
Corporations. Options may be granted under the Plan from time to time in
substitution for awards held by employees, directors or service providers of
other corporations who are about to become Directors of the Company or an
Affiliate as the result of a merger or consolidation of the employing
corporation with the Company or an Affiliate, or the acquisition by the Company
or an Affiliate of the assets of the employing corporation, or the acquisition
by the Company or Affiliate of the stock of the employing corporation, as the
result of which it becomes a designated employer under the Plan. The terms and
conditions of the Options so granted may vary from the terms and conditions set
forth in the Plan at the time of such grant as the majority of the members of
the Committee may deem appropriate to conform, in whole or in part, to the
provisions of the awards in substitution for which they are granted.
8.6 Procedure for Adoption. Any Affiliate of the Company may by
resolution of such Affiliate's board of directors, with the consent of the
Board of Directors and subject to such conditions as may be imposed by the
Board of Directors, adopt the Plan for the benefit of its employees as of the
date specified in the board resolution.
8.7 Procedure for Withdrawal. Any Affiliate which has adopted the
Plan may, by resolution of the board of directors of such direct or indirect
subsidiary, with the consent of the Board of Directors and subject to such
conditions as may be imposed by the Board of Directors, terminate its adoption
of the Plan.
8.8 Delay. If at the time a Participant incurs a Termination of
Directorship (other than due to Cause) or if at the time of a Change in
Control, the Participant is subject to "short-swing" liability under Section 16
of the Exchange Act, any time period provided for under the Plan or an
Agreement to the extent necessary to avoid the imposition of liability shall be
suspended and delayed during the period the Participant would be subject to
such liability, but
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not more than six (6) months and one (1) day and not to exceed the Option
Period. The Company shall have the right to suspend or delay any time period
described in the Plan or an Agreement if the Committee shall determine that the
action may constitute a violation of any law or result in liability under any
law to the Company, an Affiliate or a shareholder of the Company until such
time as the action required or permitted shall not constitute a violation of
law or result in liability to the Company, an Affiliate or a shareholder of the
Company. The Committee shall have the discretion to suspend the application of
the provisions of the Plan required solely to comply with Rule 16b-3 if the
Committee shall determine that Rule 16b-3 does not apply to the Plan.
8.9 Headings. The headings contained in the Plan are for
reference purposes only and shall not affect the meaning or interpretation of
the Plan.
8.10 Severability. If any provision of the Plan shall for any
reason be held to be invalid or unenforceable, such invalidity or
unenforceability shall not effect any other provision hereby, and the Plan
shall be construed as if such invalid or unenforceable provision were omitted.
8.11 Successors and Assigns. The Plan shall inure to the benefit
of and be binding upon each successor and assign of the Company. All
obligations imposed upon a Participant, and all rights granted to the Company
hereunder, shall be binding upon the Participant's heirs, legal representatives
and successors.
8.12 No Obligation to Give Notice. No provision of the Plan shall
be deemed to create an obligation on the Company to give notice to any person
or entity of any event, except as expressly set forth in this Agreement.
8.13 No Third Party Beneficiaries. Nothing in this Agreement
expressed or implied is intended to confer any right or remedy under or by
reason of this Agreement on any person other than the parties hereto and their
respective heirs, representatives, successors and assigns, nor is anything set
forth herein intended to affect or discharge the obligation or liability of any
third persons to any party to this Agreement nor shall any provision give any
third party any right of subrogation or action over against any part to this
Agreement.
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8.14 Entire Agreement. The Plan and the Agreement constitute the
entire agreement with respect to the subject matter hereof and thereof,
provided that in the event of any inconsistency between the Plan and the
Agreement, the terms and conditions of the Plan shall control.
EXECUTED on this 23rd day of May, 1996.
ANICOM, INC.
By:
---------------------------
Its:
---------------------------
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