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EX-4.1
KFORCE INC.
1999 EMPLOYEE STOCK PURCHASE PLAN
(AS OF AUGUST 2001)
1. Purpose. The purpose of the Plan is to provide employees of Kforce Inc.
and its Subsidiaries with an opportunity to purchase Common Stock of
the Company through accumulated payroll deductions. It is the intention
of the Company that the Plan qualify as an "employee stock purchase
plan" under Section 423 of the Internal Revenue Code of 1986, as
amended (the "Code"). The provisions of the Plan shall be construed so
as to extend and limit participation in a manner consistent with the
requirements of Section 423 of the Code.
2. Definitions.
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Common Stock" shall mean the common stock of the Company, par
value $.01 per share.
(c) "Company" shall mean Kforce Inc.
(d) "Compensation" shall mean all compensation paid or payable in
the Offering Period in question in cash or in kind by the
Company by reason of services performed by an Employee during
any period which is included in the Employee's federal gross
income for federal income tax purposes for the Offering
Period, excluding amounts realized from the exercise of a
non-qualified stock option or the sale, exchange or other
disposition of an incentive stock option, plus any salary
reduction contributions to any plan which are not includable
in the Employee's gross income under Section 401(k) or Section
125 of the Code.
(e) "Employee" shall mean any individual who is an employee of the
Company or a Subsidiary for federal income tax withholding
purposes. For purposes of the Plan, the employment
relationship shall be treated as continuing intact while the
individual is on sick leave or other leave of absence approved
by the Company. Where the period of sick leave exceeds 180
days and the individual's right to re-employment is not
guaranteed either by statute or by contract, the employment
relationship shall be deemed to have terminated on the 181st
day of such leave.
(f) "Enrollment Date" shall mean the first day of each Offering
Period.
(g) "Exercise Date" shall mean the last day of each Offering
Period.
(h) "Fair Market Value" shall mean the value of the Common Stock.
If the Common Stock is listed on any established stock
exchange or a national market system, including without
limitation the National Market System of the National
Association of Securities Dealers, Inc. Automated Quotation
System ("Nasdaq"), the Fair Market Value of a share of Common
Stock shall be the closing sales price for a share of Common
Stock (or the closing bid, if no sales were reported), as
quoted on such system or exchange (or the exchange with the
greater volume of trading in Common Stock) on the day of such
determination as reported in the Wall Street Journal or such
other source as the Board deems reliable. In the absence of an
established market for the Common Stock, the Fair Market Value
of a share of Common Stock shall be determined in good faith
by the Board.
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(i) "Offering Period" shall mean a period of approximately six (6)
months, commencing on the first Trading Day on or after
January 1 and terminating on the last Trading Day occurring in
the period ending the following June 30, or commencing on the
first Trading Day on or after July 1 and terminating on the
last Trading Day occurring in the period ending with the
following December 31. The duration of Offering Periods may be
changed pursuant to Section 4 of the Plan.
(j) "Plan" shall mean Kforce Inc. 1999 Employee Stock Purchase
Plan, as set forth herein and as amended from time to time.
(k) "Purchase Price" shall mean an amount equal to eighty-five
percent (85%) of the Fair Market Value of a share of Common
Stock on the Enrollment Date or on the Exercise Date,
whichever is lower.
(l) "Reserves" shall mean the number of shares of Common Stock
covered by each option under the Plan that have not yet been
exercised and the number of shares of Common Stock that have
been authorized for issuance under the Plan but not yet placed
under option.
(m) "Subsidiary" shall mean a corporation, domestic or foreign, of
which not less than fifty (50) percent of the voting shares
are held by the Company or a Subsidiary, whether or not such
corporation now exists or is hereafter organized or acquired
by the Company or a Subsidiary.
(n) "Trading Day" shall mean a day on which national stock
exchanges and Nasdaq are open for trading.
3. Eligibility.
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(a) Initial Eligibility. Any Employee who shall be employed by the
Company or a Subsidiary on the date his or her participation
in the Plan is to become effective shall be eligible to
participate in offerings under the Plan that commence on or
after such Employee becomes a participant in the Plan.
(b) Restrictions on Participation. Notwithstanding any provisions
of the Plan to the contrary, no Employee shall be granted an
option under the Plan:
(i) if, immediately after the grant, such Employee (or
any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code)
would own capital stock of the Company, and/or hold
outstanding options to purchase such stock,
possessing five percent (5%) or more of the total
combined voting power or value of all classes of the
capital stock of the Company or of any Subsidiary; or
(ii) that permits his or her rights to purchase stock
under all employee stock purchase plans of the
Company and its subsidiaries to accrue at a rate that
exceeds twenty-five thousand dollars ($25,000) in
fair market value of stock (determined at the time
such option is granted) for each calendar year in
which such option is outstanding.
(c) Commencement of Participation. An eligible Employee may become
a participant by completing an authorization for payroll
deduction on the form provided by the Company and submitting
that form to the third party administrator on or before the
date set therefor by the Board, which date shall be prior to
the Enrollment Date for the Offering Period. Payroll
deductions for a participant shall commence on the applicable
Enrollment Date
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when his authorization for a payroll deduction becomes
effective and shall end on the Exercise Date of the Offering
Period to which such authorization is applicable unless sooner
terminated by the participant as provided in Section 8(a) of
the Plan.
4. Offering Periods. The Plan shall be implemented by consecutive six (6)
month Offering Periods. The Board shall have the power to change the
duration of Offering Periods (including the commencement dates thereof)
with respect to future Offering Periods if such change is announced at
least five (5) days prior to the scheduled beginning of the first
Offering Period to be affected thereafter.
5. Payroll Deductions.
(a) Amount of Deduction. At the time a participant files his or
her subscription agreement, he or she shall elect to have
payroll deductions made on each pay day during the time he is
a participant in an Offering Period in an amount equal to any
whole percentage of the Compensation that he or she receives
on each pay day during the Offering Period. A participant may
elect up to 10%.
(b) Participant's Account. All payroll deductions made for a
participant shall be credited to his or her account under the
Plan. A participant may not make any additional payments into
his or her account.
(c) Changes in Payroll Deduction. Changes to payroll deductions
can be made by the participant in accordance to the below
restrictions. Changes are to be made by completing a new
subscription agreement and submitting it to the third party
administrator. Changes shall be made by the Company the next
payroll period following the receipt of such change notice
from the administrator or as soon as administratively
feasible. A participant's contribution election shall remain
in effect for successive Offering Periods unless changed by
the participant as indicated below or unless terminated as
provided in Section 8 hereof.
1) Increase Contributions. A participant may only
increase the amount they are contributing during the
enrollment period specified which is at the start of
any six-month Offering Period. The change in rate
will become effective with the first payroll of the
new Offering Period.
2) Decrease Contributions. A participant may decrease
the amount they are contributing once during any
six-month Offering Period. Should the participant
decrease their contribution to 0%, their previous
contributions will be used to make a purchase at the
end of that Offering Period. The change shall become
effective with the first full payroll period
following the date the Company receives the new
contribution or as soon as administratively feasible.
6. Grant of Option. On the Enrollment Date of each Offering Period, a
participant shall be deemed to have received an option to purchase on
each Exercise Date during such Offering Period at the applicable
Purchase Price a maximum number of shares of Common Stock determined by
dividing such participant's payroll deductions accumulated prior to
such Exercise Date and retained in the participant's account as of the
Exercise Date by the applicable Purchase Price.
7. Purchase of Option.
(a) Automatic Purchase. Unless a participant withdraws all of the
payroll deductions credited to his or her account prior
thereto as provided in Section 8 of the Plan, his or her
option for the purchase of Common Stock with payroll
deductions made during an Offering Period shall be deemed to
have been purchased automatically on the Exercise
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Date applicable to such Offering Period for the purchase of a
number of shares of Common Stock that the accumulated payroll
deductions in his or her account at that time will purchase at
the applicable option price (but not in excess of the number
of shares for which options have been granted to the
participant under Section 6 of the Plan). Whole and fractional
shares shall be purchased. During a participant's lifetime, a
participant's option to purchase shares hereunder is
exercisable only by him or her.
(b) Sale of Stock. Participants may sell their stock, transfer
shares to a broker, or take stock certificates of shares after
completing a 6-month holding period. The 6-month holding
period begins from the date the stock is purchased at the end
of the Offering Period. To initiate this process, the
participant must contact the third party administrator for
instructions.
8. Withdrawal.
(a) General. A participant may withdraw from the plan and receive
all of the payroll deductions credited to his or her account
and not yet used to exercise his or her option under the Plan
at any time during an Offering Period up to 15 days prior to
the close of the Offering Period by submitting the proper
paperwork to the third party administrator. All of the
participant's payroll deductions contributed during that
Offering Period shall be paid to such participant, such
participant's option for the Offering Period shall be
automatically terminated, and no further payroll deductions
for the purchase of shares shall be made for such Offering
Period.
(b) Effect on Subsequent Participation. A participant's withdrawal
from the Plan and the receipt of the payroll deductions
credited to his or her account shall not have any effect upon
his or her eligibility to participate in any similar plan that
may hereafter be adopted by the Company or in succeeding
Offering Periods that commence after the termination of the
Offering Period from which the participant withdraws. If,
however, a participant withdraws from the Plan during an
Offering Period, payroll deductions shall not resume at the
beginning of the succeeding Offering Period unless the
participant delivers to the third party administrator a new
subscription agreement prior to the commencement of such
succeeding Offering Period.
(c) Termination of Employment. Upon a participant's ceasing to be
an Employee, for any reason, he or she shall be deemed to have
elected to withdraw from the Plan and the payroll deductions
credited to such participant's account during the Offering
Period but not yet used to exercise the option shall be
returned to such participant or, in the case of his or her
death, to the person or persons entitled thereto under Section
12 of the Plan, and such participant's option shall be
automatically terminated. Notwithstanding the preceding
sentence, a participant who receives payment in lieu of notice
of employment shall be treated as continuing to be an Employee
for the participant's customary number of hours per week of
employment during the period in which the participant is
subject to such payment in lieu of notice.
9. Interest. No interest shall accrue on the payroll deductions
of a participant in the Plan.
10. Stock.
(a) Maximum Shares of Kforce Common Stock. The maximum number of
shares of the Company's Common Stock that shall be made
available for sale under the Plan shall be six million
(6,000,000) shares, subject to adjustment upon changes in
capitalization of the Company as provided in Section 16 of the
Plan. If, on a given Exercise Date, the number of shares with
respect to which options are to be exercised exceeds the
number of shares available under the Plan, the Company shall
make a pro rata allocation of the shares remaining available
for purchase in as uniform a manner as shall be practicable
and as it
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shall determine to be equitable, and the balance of payroll
deductions credited to the account of each participant shall
be returned to him or her as promptly as possible.
(b) Participant's Interest in Option Stock. The participant shall
have no interest or voting right in shares covered by his or
her option until such option has been exercised.
(c) Registration of Stock. Shares of Kforce Common Stock to be
delivered to a participant under the Plan shall be registered
in the name of the participant or in the name of the
participant and his or her spouse as joint tenants with right
of survivorship.
11. Administration. The Plan shall be administered by the Board or a
committee of members of the Board appointed by the Board. The Board or
its committee shall have full and exclusive discretionary authority to
construe, interpret and apply the terms of the Plan, to determine
eligibility and to adjudicate all disputed claims filed under the Plan.
Every finding, decision and determination made by the Board or its
committee shall, to the full extent permitted by law, be final and
binding upon all parties.
12. Designation of Beneficiary. A participant may file a written
designation of a beneficiary who is to receive any shares and cash, if
any, from the participant's account under the Plan in the event of such
participant's death subsequent to an Exercise Date on which the option
is exercised but prior to delivery to such participant of such shares
and cash. In addition, a participant may file a written designation of
a beneficiary who is to receive any cash from the participant's account
under the Plan in the event of such participant's death prior to
exercise of the option. If a participant is married and the designated
beneficiary is not the spouse, spousal consent shall be required for
such designation to be effective. Such designation of beneficiary may
be changed by the participant at any time by written notice. In the
event of the death of the 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/or 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, in its discretion, may
deliver such shares and/or cash to the spouse or to any one or more
dependents or relatives of such participant, or, if no spouse,
dependent or relative is known to the Company, then to such other
person as the Company may designate.
13. Transferability. Neither payroll deductions credited to a participant's
account nor any rights with regard to the exercise of an option or to
receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of
descent and distribution) by the participant. Any such attempt at
assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to
withdraw funds from an Offering Period in accordance with Section 8 of
the Plan.
14. Use of Funds. All payroll deductions received or held by the Company
under the Plan may be used by the Company for any corporate purpose,
and the Company shall not be obligated to segregate such payroll
deductions.
15. Reports. Individual accounts shall be maintained for each participant
in the Plan. Statements of account shall be given to participating
Employees at least annually, which statements shall set forth the
amounts of payroll deductions, the Purchase Price, the number of shares
purchased and the remaining cash balance, if any.
16. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
Merger or Asset Sale.
(a) Changes in Capitalization. Subject to any required action by
the shareholders of the Company, (i) the Reserves, (ii) the
maximum number of shares each participant may purchase during
each Offering Period, (iii) the Purchase Price per share, and
(iv) the
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number of shares of Common Stock covered by each option under
the Plan that has not yet been exercised shall be
proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or
decrease in the number of shares of Common Stock effected
without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the
Company shall not be deemed to have been "effected without
receipt of consideration." Such adjustment shall be made by
the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein,
no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common
Stock subject to an option.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Offering Period
then in progress shall be shortened by setting a new Exercise
Date (the "New Exercise Date"), and shall terminate
immediately prior to the consummation of such proposed
dissolution or liquidation, unless provided otherwise by the
Board. The New Exercise Date shall be before the date of the
Company's proposed dissolution or liquidation. The Board shall
notify each participant in writing, at least ten (10) business
days prior to the New Exercise Date, that the Exercise Date
for the participant's option has been changed to the New
Exercise Date and that the participant's option shall be
exercised automatically on the New Exercise Date, unless prior
to such date the participant has withdrawn the payroll
deductions credited to his or her account as provided in
Section 8 of the Plan.
(c) Merger or Asset Sale. In the event of a proposed sale of all
or substantially all of the assets of the Company, or the
merger of the Company with or into another corporation, the
Company shall use its best efforts to have each outstanding
option assumed or an equivalent option substituted by the
successor corporation or a parent or Subsidiary of the
successor corporation. In the event that the successor
corporation refuses to assume or substitute for the option,
the Company shall set a New Exercise Date and any Offering
Periods then in progress shall end on the New Exercise Date.
The New Exercise Date shall be the date immediately prior to
the date of the Company's proposed sale or merger. The Board
shall notify each participant in writing, at least ten (10)
business days prior to the New Exercise Date, that the
Exercise Date for the participant's option has been changed to
the New Exercise Date and that the participant's option shall
be exercised automatically on the New Exercise Date, unless
prior to such date the participant has withdrawn the payroll
deductions credited to his or her account as provided in
Section 8 of the Plan.
17. Amendment or Termination. The Board of Directors of the Company may at
any time and for any reason terminate or amend the Plan. Except as
provided in Section 16 of the Plan, no such termination can affect
options previously granted; provided, that an Offering Period may be
shortened by the Board of Directors to an earlier Exercise Date and the
Plan may be terminated immediately thereafter if the Board determines
that the termination of the Plan is in the best interests of the
Company and its shareholders. Except as provided in Section 16 of the
Plan, no amendment may make any change in any option theretofore
granted that adversely affects the rights of any participant. To the
extent necessary to comply with Section 423 of the Code (or any
successor rule or provision or any other applicable law, regulation or
stock exchange rule), the Company shall obtain shareholder approval for
any amendment to the Plan in such a manner and to such a degree as
required. Without shareholder consent and without regard to whether any
participant rights may be considered to have been "adversely affected,"
the Board (or its committee) shall be entitled to change Offering
Periods, limit the frequency and/or number of changes in the amount
withheld during an Offering Period, establish the exchange ratio
applicable to amounts designated by a participant in order to adjust
for delays or mistakes in the Company's
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processing of properly completed withholding elections, establish
reasonable waiting and adjustment periods and/or accounting and
crediting procedures to ensure that amounts applied toward purchase of
Common Stock for each participant properly correspond with amounts
withheld from the participant's Compensation, and establish such other
limitations or procedures as the Board (or its committee) determines in
its sole discretion advisable that are consistent with the Plan.
18. 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 in the form specified by the Company at
the location, or by the person, designated by the Company for the
receipt thereof.
19. Conditions Upon Issuance of Shares of Kforce Common Stock. Shares of
Kforce Common Stock shall not be issued with respect to an option
unless the exercise of such option and the issuance and delivery of
such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation,
the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon
which the shares may be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance. As
a condition to the exercise of an option, the Company may require the
person exercising such option to represent and warrant at the time of
any such exercise that the shares are being purchased only for
investment and without any present intention to sell or distribute such
shares if, in the opinion of counsel for the Company, such a
representation is required by any of the aforementioned applicable
provisions of law. The terms and conditions of options granted under
the Plan to, and the purchase of shares by, persons subject to Section
16 of the Exchange Act shall comply with the applicable provisions of
Rule 16b-3 under the Exchange Act. This Plan shall be deemed to
contain, and such options shall contain, and the shares issued upon
exercise thereof shall be subject to, such additional conditions and
restrictions as may be required by Rule 16b-3 under the Exchange Act to
qualify for the maximum exemption from Section 16 of the Exchange Act
with respect to Plan transactions.
In addition to the restriction described in the first paragraph of this
Section 19, the shares of the Company's Common Stock received by any
person upon the exercise of an option may not be sold, assigned,
transferred, pledged or otherwise disposed of for a period of six
months from the date of such exercise. The shares of Company's Common
Stock received upon the exercise of an option may bear a legend to such
effect or the Company may require the person receiving such shares to
execute an agreement to such effect.
20. Tax Withholding. At the time the option is exercised, in whole or in
part, or at the time some or all of the Company's Common Stock issued
under the Plan is disposed of, the participant must make adequate
provision for the Company's federal, state or other tax withholding
obligations, if any, that arise upon the exercise of the option or the
disposition of the Common Stock. At any time, the Company may, but
shall not be obligated to, withhold from the participant's compensation
the amount necessary for the Company to meet applicable withholding
obligations, including any withholding required to make available to
the Company any tax deductions attributable to sale or early
disposition of Common Stock by the Employee.
21. Term of Plan. The Plan shall become effective upon the earlier to occur
of its adoption by the Board of Directors or its approval by the
shareholders of the Company. It shall continue in effect for a term of
ten (10) years unless terminated under Section 17 of the Plan.
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