Exhibit 4.1
AUTOMATIC DATA PROCESSING, INC.
EMPLOYEES' SAVING - STOCK OPTION PLAN
The following are the terms and restrictions of the Employees' Saving -
Stock Option Plan ("the Plan"), as adopted by the Board of Directors of
Automatic Data Processing, Inc. (the "Company") on January 29, 1996, for the
French-based employees of the Company and its subsidiaries:
1.The Plan is granted for a period commencing January 1, 1996 and ending
January 31, 1998 (the "Stock Option Period") to all employees of the Company's
French subsidiaries having concluded an indefinite-term employment contract as
of October 31, 1995. No employee shall be granted an option under this Plan if
such employee, immediately after the option is granted, owns stock in the
Company possessing 5% or more of the total combined voting power or value of
all classes of stock of the Company. Persons eligible to participate in the
Plan pursuant to this Section 1 are hereinafter called "Eligible Employees".
2.The maximum number of shares of Common Stock of the Company that may be
issued and sold to all employees of the Company and its subsidiaries in France
and outside of France under the Plan and comparable plans is 10,513,012. For
each Eligible Employee, the maximum number of stock options he may elect to
receive is limited to the nearest whole number of stock options determined by
dividing (a) an amount equal to 10% of his gross annual base salary in effect
on October 31, 1995 (bonuses and benefits in kind excluded), by (b) the price
per share provided in Section 3 below, up to a maximum of 698 options.
3.The price at which the Eligible Employees may exercise their options to
acquire shares of the Company is irrevocably fixed for all the duration of the
Plan to $30.39 per share, corresponding to FRF 148.53 per share, using an
exchange rate of FRF 4.8876 for $1.
4.The shares that the Eligible Employees may decide to acquire by
exercising their options will be paid by monthly deductions from their salaries
over a 23 calendar-month period commencing February 1, 1996 and ending December
31, 1997. Such deductions will correspond to FRF 6.46 per option and will bear
interest at a rate linked with that of the French monetary rate. The funds
collected from the Eligible Employees will be managed by a financial
institution.
5.The Eligible Employees shall be entitled to exercise their stock options
by written notice of exercise delivered to the ADP French subsidiary which
employs them, from January 15 to January 31, 1998.
6.The Eligible Employees who have elected to benefit from stock options may
withdraw from the Plan and cancel their election with respect to any or all of
such stock options by written notice of cancellation delivered to the ADP
French subsidiary which employs them, at any time during the Stock Option
Period. If an Eligible Employee cancels his election as to part
of the stock
options, he shall continue to make the required installment payments with
respect to the stock options which he has not cancelled.
An Eligible Employee's rights with respect to the stock options which he
has cancelled shall be to receive in cash, within 15 business days following
the end of the calendar month during which he has delivered the notice of
cancellation, the amount credited to his account with respect to such stock
options, which amount will include any interest to which he may be entitled.
7.In order to minimize the exchange risks pertaining to the respective
fluctuation of the French franc and the US dollar during the 23 calendar-month
period referred to in Section 4 above, the following method will be applied if
the Eligible Employees exercise their options to acquire shares of the Company:
-if, at the expiration of the 23 calendar-month period, i.e. on December
31, 1997, the exchange rate between the French franc and the US $ is the
same as the rate used to calculate the FRF equivalent of the price for the
shares, i.e. FRF 4.8876 for US dollar 1 (the "Reference Rate"), there will
be no adjustment;
-if on the same date, the French franc is higher, the Eligible Employees
will be reimbursed for the difference between the Reference Rate and the
rate in effect on December 31, 1997;
-if, on the same date, the French franc is lower, the Eligible Employees
will have the option either:
* to make an additional payment covering the difference between the rate
in effect on December 31, 1997 and the Reference Rate in order to
exercise all their stock options; or
* to exercise their stock options for a lower number of shares,
corresponding to the US dollar equivalent of the FRF amounts credited
to their accounts.
8.In the event of a stock dividend or a subdivision or combination of the
shares of capital stock of the Company, the maximum number of shares which may
thereafter be issued and sold under the Plan will be proportionately increased
or decreased, the terms relating to the price at which options to acquire
shares may be exercised will be appropriately adjusted, and such other action
will be taken as in the opinion of the Board of Directors of the Company will
be appropriate under the circumstances. In case of reclassification or other
change in the shares of capital stock of the Company, the Board of Directors of
the Company will make appropriate adjustments.
In the event that the Company is merged into another corporation, the Board
of Directors of the surviving or acquiring corporation may, but shall not be
required to, make such modification as is permissible and appropriate.
9.No option granted under the offering made pursuant to this Plan shall be
transferrable by an Eligible Employee, and an Eligible Employee's rights under
this offering shall be exercisable, during his lifetime, only by him.
10.Subject to the foregoing terms and restrictions, rules and regulations
and other matters relating to the Plan may be prescribed by the Board of
Directors of the Company.
11.If, prior to January 1, 1998, an Eligible Employee having elected to
receive stock options dies, resigns, is dismissed, or if he transfers to a
company other than the Company or a subsidiary thereof, or if the company by
which he is employed ceases to be a subsidiary of the Company, his rights under
the Plan shall thereupon be deemed to be cancelled. In such case, the rights
of the Eligible Employee (or of his estate) shall be to receive in cash, within
15 business days following the end of the calendar month during which his
rights under the Plan shall be deemed to be cancelled pursuant to this
Section 11, the amount credited to his account, which amount shall include any
interest to which he may be entitled.
12.An Eligible Employee who has been granted a leave of absence by the
Company's French subsidiary employing him for any reason may suspend payments
referred to in Section 4 above, or make payments in cash, for a period not to
exceed three months or, if such leave of absence is due to medical reasons,
nine months, following the date of the commencement of such leave of absence.
After such period, if the leave of absence continues, the Eligible Employee
shall be given the option of (a) receiving a cash refund of the amount credited
to his account within 15 business days following the end of the calendar month
during which the three-month (or nine-month) period has expired, which amount
shall include any interest to which he may be entitled, or (b) exercising the
option for such number of shares as such amount will permit, and receiving the
balance, if any, of such amount in cash.
13.An Eligible Employee who has retired will be permitted to continue
payments for a period not exceeding three months after retirement and if, at
the expiration of such period, payments have not been completed in accordance
with Section 4 above, either of the options described in Section 12 above may
be exercised with respect to the balance in his account.