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EXHIBIT 10.1
HAVERTY FURNITURE COMPANIES, INC.
EMPLOYEE STOCK PURCHASE PLAN
As Amended and Restated February 7, 1995
and As Amended November 1, 1996
and As Amended and Restated October 29, 1999
1. Purpose. The purpose of the Haverty Furniture Companies, Inc. Employee
Stock Purchase Plan (the "Plan") is to encourage and enable eligible
employees of Haverty Furniture Companies, Inc. (the "Company") and any
of its subsidiaries to acquire proprietary interests in the Company
through the ownership of Common Stock of the Company. The Company
believes that employees who participate in the Plan will have a closer
identification with the Company by virtue of their ability as
stockholders to participate in the Company's growth and earnings. It is
the intention of the Company to have the Plan qualify as an "employee
stock purchase plan" under Section 423 of the Internal Revenue Code of
1986, as amended (the "Code"). Accordingly, the provisions of the Plan
shall be construed so as to extend and limit participation in a manner
consistent with the requirements of that section of the Code.
2. Definitions. The following words or terms have the following meanings:
(a) "Plan" shall mean this Haverty Furniture Companies, Inc.
Employee Stock Purchase Plan.
(b) "Company" shall mean Haverty Furniture Companies, Inc.
(c) "Board of Directors" shall mean the Board of Directors of the
Company or the Executive Committee of such Board.
(d) "Shares," "Stock" or "Common Stock" shall mean shares of the
$1.00 par value Common Stock of the Company.
(e) "Committee" shall mean the Stock Option Committee of the Board
of Directors of the Company.
(f) "Subsidiary" shall mean any corporation, if the Company owns
or controls, directly or indirectly, more than 50 percent of
the voting stock of such corporation.
(g) "Eligible Employee" shall mean a person regularly employed by
the Company or a Subsidiary on the effective date of any
offering of stock pursuant to the
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Plan; provided, however, that no person shall be considered an
Eligible Employee unless he or she is customarily employed by
the Company or a Subsidiary for at least twenty hours per week
and as of such effective date has been employed by the Company
or a Subsidiary for more than one year; and provided further,
that the Board of Directors may exclude the employees of any
specified Subsidiaries from any offering under the Plan. EX
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(h) "Offer Period" shall mean, with respect to any offering of
Stock hereunder, the period specified by the Committee (which
shall normally consist of six (6) calendar months) during
which such offering is effective and outstanding.
(i) "Grant Date" shall mean the commencement date of the
applicable Offer Period.
(j) "Exercise Date" shall mean the termination date of the
applicable Offer Period.
(k) "Options" shall mean the right or rights granted to Eligible
Employees to purchase the Company's Common Stock under an
offering made under the Plan and pursuant to such Eligible
Employees' elections to participate in such offering.
(l) "Fair Market Value" shall mean the closing price of the
Company's $1.00 par value Common Stock as quoted on the
National Association of Securities Dealers, Inc. National
Market System.
(m) "Annual Pay" shall mean, with respect to any Eligible
Employee, the taxable earnings paid by the Employer to the
Eligible Employee and reported on his Form W-2 for the
calendar year preceding the year in which the applicable
offering commences; provided that Annual Pay will include (a)
basic salary or wages, (b) overtime pay, (c) bonuses, (d)
commissions, (e) amounts deferred under Internal Revenue Code
Sections 401(k) and/or 125 pursuant to the Eligible Employee's
salary reduction agreement, and (f) amounts deferred under the
Company's Top Hat Mutual Fund Option Plan and/or any other
deferred compensation plan maintained by the Company and
Annual Pay will exclude (a) employer-paid FICA taxes and
contributions under any qualified pension plan to the extent
not currently taxable to the Eligible Employee, (b) amounts
realized from the exercise of nonqualified stock options or
the lapse of restrictions on stock or other disposition of
stock acquired under a qualified or incentive stock option,
(c) the imputed value of group term life insurance, (d) cash
and noncash fringe benefits including taxable fringe benefits
from the use of Company-owned vehicles, (e) reimbursements and
expense allowances, (f) moving expenses, (g) welfare benefits,
(h) income realized upon a participant's actual or
constructive receipt of amounts payable under any deferred
compensation plan maintained by the Company, including,
without limitation, pursuant to exercise of an option to
acquire mutual fund shares at a discount pursuant to the
Company's Top Hat
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Mutual Fund Option Plan, and (i) other amounts which receive
special tax benefits.
(n) "Minimum Contribution" shall mean, with respect to any
offering under the Plan, 1% of Annual Pay.
3. Shares Reserved for Plan. The Shares of the Company's Common Stock to
be sold to Eligible Employees under the Plan may, at the election of
the Company, be either treasury shares or shares originally issued for
such purpose. The maximum number of Shares which shall be reserved and
made available for sale under the Plan shall be 1,500,000 (giving
effect to the June 30, 1993 stock split and the August 25, 1999 stock
split) of which 396,500 shares remained available for issuance as of
August 25, 1999 (after giving effect to the August 25, 1999 stock
split). The Shares reserved may be issued and sold pursuant to one or
more offerings under the Plan. With respect to each offering, the Board
of Directors, or the Committee, will specify the number of Shares to be
made available, the commencement date and the termination date of the
applicable Offer Period and such other terms and conditions not
inconsistent with the Plan as may be necessary or appropriate. In no
event shall the Offer Period for any offering exceed 27 months.
In the event of a subdivision, combination or reclassification
of the Company's Shares, the maximum number of Shares which may
thereafter be issued and sold under the Plan and the number of Shares
subject to options to purchase at the time of such subdivision,
combination or reclassification will be proportionately increased or
decreased, the terms relating to the price at which Shares subject to
options to purchase will be sold will be appropriately adjusted, and
such other action will be taken as in the opinion of the Board of
Directors is appropriate under the circumstances.
4. Administration of the Plan. Except as otherwise provided herein, the
Plan shall be administered by the Committee. Subject to the provisions
of Paragraph 6, the Committee shall be vested with full authority to
make, administer and interpret such equitable rules and regulations
regarding the Plan as it may deem advisable. Except as otherwise
provided herein, any determination, decision or action of the Committee
in connection with the construction, interpretation, administration or
application of the Plan shall be final, conclusive and binding upon all
Eligible Employees and any and all persons claiming under or through an
Eligible Employee.
The Committee may act by a majority vote at a regular or
special meeting of the Committee or by decision reduced to writing and
signed by a majority of the members of the Committee without holding a
formal meeting. Vacancies in the membership of the Committee shall be
filled by the Board of Directors.
The Committee may request that the management of the Company
appoint a "Plan Administrator" to carry out the administrative and
ministerial functions necessary to implement the determinations,
decisions and actions of the Committee with respect to
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any offering under the Plan.
5. Offerings. The Plan will be implemented by offerings made by the
Company from time to time as determined by the Committee, but in any
event not more than two times per year. Participation in any offering
under the Plan shall neither limit, nor require, participation in any
other offering except that no employee may have more than one
authorization for a payroll deduction in effect simultaneously.
6. Participation in the Plan. (a) Options to purchase the Company's Common
Stock under the Plan shall be granted only to Eligible Employees. With
respect to any offering under the Plan, options to purchase Shares
shall be granted to all Eligible Employees of the Company and its
Subsidiaries (other than any Subsidiary whose employees have been
excluded from such offering by the Board of Directors) who have elected
to participate in such offering as provided hereunder; provided,
however, that the Board of Directors may determine that any offering of
Common Stock under the Plan will not be extended to highly compensated
employees (within the meaning of Section 414(q) of the Code) of the
Company or its Subsidiaries, and provided further that in no event may
an employee be granted an option under this Plan if such employee,
immediately after the option is granted, owns Stock possessing five
percent or more of the total combined voting power or value of all
classes of capital stock of the Company or any Subsidiary.
(b) For the purposes of determining stock ownership under
this Paragraph 6, the rules of Section 424(d) of the Code shall apply
and Stock which the employee may purchase under all outstanding options
(whether or not granted under this Plan) shall be treated as Stock
owned by the employee. Any decision relating to whether to include or
exclude any officer or highly compensated employee of the Company
pursuant to this Paragraph 6 shall be made only by the members of the
Board of Directors who are not executive officers of the Company and
who have not participated in this Plan or any similar employee stock
option plan of the Company (except the Company's 1986, 1988 and 1993
Non-Qualified Stock Option Plans) for a period of at least one year
prior to such determination.
(c) An Eligible Employee may become a participant by
completing the form provided by the Company for such purpose in
connection with the applicable offering and filing it with the Plan
Administrator (or such other person as may be designated by the Company
on such form) prior to the commencement date of the applicable
offering.
(d) With respect to any offer hereunder, each
participating Eligible Employee shall have the same rights and
privileges subject to the limitations set forth in Paragraph 10;
provided, that the use of Annual Pay (which varies among Eligible
Employees) as the basis for determining the number of Shares for which
an Eligible Employee may be granted an option shall not be construed to
create a difference in such rights and privileges so long as each
Eligible Employee has the right to elect the same percentage of his
Annual Pay as a payroll deduction under Paragraph 8.
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7. Purchase Price. The purchase price for Shares purchased pursuant to the
Plan will be the lesser of (a) an amount equal to 85% of the Fair
Market Value of the Stock on the Grant Date, or if no Shares were
traded on that day, on the last day prior thereto on which Shares were
traded; or (b) an amount equal to 85% of the Fair Market Value of the
Stock on the Exercise Date, or if no Shares were traded on that day, on
the last day prior thereto on which Shares were traded. The purchase
price for Shares purchased pursuant to the Plan will be payable only by
means of payroll deductions as provided herein.
8. Payroll Deductions. (a) In the form filed pursuant to Paragraph 6(c) a
participant shall specify an amount which, in the aggregate during such
offering, is not less than one percent (1%) and not more than ten
percent (10%) of his Annual Pay which will be deducted from his pay in
equal (or as nearly equal as is practicable) installments on each
payday during the time he is a participant in such offering. Payroll
deductions for a participant shall commence on the commencement date of
the offering to which the authorization for a payroll deduction is
applicable and shall end on the termination date of such offering
unless sooner terminated by the Participant as provided in Paragraph
13.
(b) Intentionally omitted.
(c) All payroll deductions made for a participant shall
be credited to his account under the Plan.
(d) A participant may discontinue his participation in
the Plan as provided in Paragraph 13. During each Offer Period, a
participant may reduce the rate of his payroll deductions one time for
that offering by giving written notice of such reduction to the Plan
Administrator; provided, however, that a participant who is not
discontinuing his participation in the Plan as provided in Paragraph 13
may not reduce the rate of his payroll deductions below that required
to enable the participant to make the Minimum Contribution. If for any
reason other than the termination of the participant's employment
subject to Paragraph 13(c), a participant has no pay or his pay is
insufficient (after other authorized deductions) to permit deduction of
his scheduled payroll deductions hereunder during a portion of the
Offer Period and such participant's actual payroll deductions during
the Offer Period equal less than the Minimum Contribution, such
participant shall be deemed to have elected to withdraw from the
offering effective on the termination date of such offering as provided
in Paragraph 11(a)(i).
9. Grants of Options. Subject to the limitations set forth below in this
Paragraph 9 or in Paragraph 10, each Eligible Employee participating in
an offering shall be granted an option to purchase a fixed maximum
number of Shares determined by the following procedure:
Step 1 - Determine the aggregate amount which would
be withheld from the
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Eligible Employee's pay during the
applicable Offer Period in accordance with
such Eligible Employee's authorization for a
payroll deduction;
Step 2 - Determine the figure which represents 85%
of the Fair Market Value on the Grant Date;
Step 3 - Divide the figure determined in Step 1 by
the figure determined in Step 2 and round
off the quotient to the nearest whole
number. Subject to the limitations set forth
herein, this final figure shall be the fixed
maximum number of Shares for which the
Eligible Employee may be granted an option
to purchase under the applicable offering.
In the event the total maximum number of Shares for which options would
otherwise be granted in accordance with this Paragraph 9 under any offering
hereunder exceeds the number of Shares offered, the Company shall reduce the
maximum number of Shares for which Eligible Employees may be granted options to
allot the Shares available in such manner as it shall determine, but generally
pro rata, and shall grant options to purchase only for such reduced number of
Shares. In such event, the payroll deductions to be made pursuant to the
authorizations therefor shall be reduced accordingly (without regard to the
otherwise applicable Minimum Contribution) and the Company shall give written
notice of such reduction to each employee affected thereby.
On the Grant Date each participating Eligible Employee shall be granted
an option to purchase the number of Shares determined under this Paragraph 9,
subject to the limitations set forth in Paragraph 10. Notice that an option has
been granted shall be given to each participating Eligible Employee and such
notice shall show the maximum number of Shares subject to such option and the
amount to be deducted from the Eligible Employee's pay for each payroll period
during the applicable Offer Period.
All Shares included in any offering under the Plan in excess of the
total number of Shares for which options are granted hereunder and all Shares
with respect to which options granted hereunder are not exercised shall continue
to be reserved for the Plan and shall be available for inclusion in any
subsequent offering under the Plan.
10. Limitations Of Number Of Options Which May Be Granted And Shares Which
May Be Purchased. The following limitations shall apply with respect to
the number of Shares for which each Eligible Employee who elects to
participate in an offering under the Plan may be granted an option
hereunder:
(1) No Eligible Employee may purchase Shares under any one
offering pursuant to the Plan for an aggregate purchase price
in excess of 10% of his Annual Pay; and
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(2) No Eligible Employee participating in an offering and not
withdrawing therefrom may purchase Shares under any one
offering pursuant to the Plan for an aggregate purchase price
which is less than 1% of his Annual Pay, unless such purchase
relates to the full number of shares subject to the option
granted to such Eligible Employee pursuant to the Plan; and
(3) No Eligible Employee shall be granted an option to purchase
Shares under the Plan if such Eligible Employee immediately
after such option is granted, owns stock or holds options to
purchase stock possessing in the aggregate five percent or
more of the total combined voting power or value of the
capital stock of the Company or of any Subsidiary (under the
rules set forth in Section 424(d) of the Code); and
(4) No Eligible Employee may be granted an option to purchase
Shares which permits his right to purchase Stock under the
Plan and all other stock option plans of the Company and of
any Subsidiary pursuant to Section 423 of the Code to accrue
at a rate which exceeds in any one calendar year $25,000 of
the fair market value of such Stock (determined on the Grant
Date).
11. Exercise of Option. (a) Unless a participant's aggregate payroll
deductions with respect to an offering are less than the Minimum
Contribution (other than as the result of a reduction in payroll
deductions pursuant to Section 9 hereof) or the participant gives
written notice to the Company as hereinafter provided, his option to
purchase Shares in such offering will be exercised automatically for
him on the termination date of the applicable offering, for the
purchase of the number of whole Shares subject to such participant's
option which the accumulated payroll deductions in his account at that
time will purchase at the applicable option price.
(b) By written notice to the Company not earlier than
ninety (90) days prior to the termination date of the applicable
offering and not later than the day prior to such termination date, a
participant may elect, effective on the termination date of such
offering, to:
(i) Withdraw all the accumulated payroll deductions in
his account at the termination date; or
(ii) Exercise his option for a specified number of whole
Shares less than the number of whole Shares subject
to such option which the accumulated payroll
deductions in his account at the termination date
will purchase at the applicable option price;
provided, however, no participant may exercise an
option pursuant to this Paragraph 11(a)(2)(ii) for a
number of whole shares which is less than the number
of whole shares which such participant's Minimum
Contribution would purchase at the applicable option
price.
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12. Delivery. As promptly as practicable after the termination of each
offering, the Company will deliver to each participant, as appropriate,
either the Shares purchased upon the exercise of his option together
with a cash payment equal to the balance of any payroll deductions
credited to his account during such offering which were not used for
the purchase of Shares, or a cash payment equal to the total of the
payroll deductions credited to his account during such offering.
13. Withdrawal. (a) A participant may withdraw payroll deductions credited
to his account under the Plan at any time by giving written notice to
the Company. All of the participant's payroll deductions credited to
his account will be paid to him promptly after receipt of his notice of
withdrawal, and no further payroll deductions will be made from his pay
except in accordance with an authorization for a new payroll deduction
filed with respect to a different offering in accordance with Paragraph
6(c).
(b) A participant's withdrawal will not have any effect
upon his eligibility to participate in a succeeding offering or in any
similar plan which may hereafter be adopted by the Company.
(c) Upon termination of the participant's employment for
any reason, including retirement, the payroll deductions credited to
his account will be returned to him, or, in the case of his death, to
the person or persons entitled thereto under Paragraph 14 and all
options granted to such participant hereunder and not previously
exercised shall be deemed canceled.
14. Designation of Beneficiary. A participant may file a written
designation of a beneficiary who is to receive any Shares and cash to
the participant's credit under the Plan in the event of such
participant's death prior to delivery to him of such Shares and cash.
Such designation of beneficiary may be changed by the participant at
any time by written notice. Upon the death of a participant and upon
receipt by the Company of proof of the identity and existence at the
participant's death of a beneficiary validly designated by him under
the Plan, the Company shall deliver such Shares and cash to such
beneficiary. In the event of the death of a participant and in the
absence of a beneficiary validly designated under the Plan who is
living at the time of such participant's death, the Company shall
deliver such Shares and cash to the executor or administrator of the
estate of the participant, or if no such executor or administrator has
been appointed (to the knowledge of the Company) the Company shall
deliver such Shares and cash to the applicable court having
jurisdiction over the administration of such estate. No designated
beneficiary shall, prior to the death of the participant by whom he has
been designated, acquire any interest in the Shares or cash credited to
the participant under the Plan.
15. Rights As Stockholder. An Eligible Employee shall have no rights as a
stockholder with respect to Shares subject to an option until such
option has been exercised with respect to such Shares in connection
with the terms hereunder. A certificate for the Shares purchased will
be issued as soon as practicable after the termination of the
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applicable offering. Such Shares will be registered in the name of the
applicable Eligible Employee.
16. Options Not Transferable. Neither an Eligible Employee's options nor
the payroll deductions credited to such Eligible Employee's account may
be sold, pledged, assigned or transferred in any manner otherwise than
by will or by the laws of descent and distribution, and during the
lifetime of the Eligible Employee, such options may only be exercised
by him or her. If this provision is violated the right of the Eligible
Employee to exercise such options shall terminate and the only right
remaining hereunder with respect to such options and such payroll
deductions will be to have paid over to the person entitled thereto the
amount then credited to the Eligible Employee's account.
17. Application of Funds. All funds received by the Company pursuant to
payroll deductions authorized in accordance with the terms hereof and
held by the Company at any time may be used for any valid corporate
purpose and will not be maintained in a segregated account.
Participants shall not be entitled to earn interest on any such funds
held by the Company hereunder. Until paid over to the applicable
Eligible Employee or used to purchase Shares as provided hereunder, the
amount of each Eligible Employee's payroll deductions in connection
with any applicable offering shall represent an indebtedness of the
Company to such Eligible Employee.
18. Governmental Approvals or Consents. The Plan shall not be effective
unless it is approved by the stockholders of the Company within 12
months after the Plan is adopted by the Board of Directors of the
Company. The Plan and any offerings and sales to Eligible Employees
under it are subject to any governmental approvals or consents that may
be or become applicable in connection therewith. The Board of Directors
of the Company may make such changes in the Plan and include such terms
in any offering under the Plan as may be necessary or desirable, in the
opinion of counsel, so that the Plan will comply with the rules and
regulations of any governmental authority and so that Eligible
Employees participating in the Plan will be eligible for tax benefits
under the Code or the laws of any state.
19. Amendment or Termination. The Board of Directors of the Company may at
any time terminate or amend the Plan. No such termination shall affect
options previously granted, nor may an amendment make any change in any
option theretofore granted which would adversely affect the rights of
any participant nor may an amendment be made without prior approval of
the stockholders of the Company if such amendment would:
(1) Increase the maximum number of shares authorized under
Paragraph 3 for sale under the Plan otherwise than as required
to reflect a subdivision, a combination or a reclassification
as provided in Paragraph 3 hereof; or
(2) Expand the persons eligible to participate in the Plan beyond
the employees of
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the Company and its Subsidiaries.
20. Notices. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have
been duly given when received by the Treasurer of the Company or when
received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.
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