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EXHIBIT 10.8
PHYSICIANS SALES & SERVICE, INC.
AMENDED AND RESTATED
DIRECTORS' STOCK PLAN
I. GENERAL
1.1 PURPOSE OF THE PLAN
The purpose of the Physician Sales & Service, Inc. Directors' Stock Plan
(the "Plan") is to enable Physician Sales & Service, Inc. (the "Company") to
attract and retain persons of exceptional ability to serve as directors of the
Company and to align the interests of directors and shareholders in enhancing
the value of the Company's common stock (the "Common Stock").
1.2 ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Compensation Committee or its
successor (the "Committee") of the Company's Board of Directors (the "Board")
which shall have full and final authority in its discretion to interpret,
administer and amend the provisions of the Plan; to adopt rules and regulations
for carrying out the Plan; to decide all questions of fact arising in the
application of the Plan; and to make all other determinations necessary or
advisable for the administration of the Plan. The Committee shall consist of at
least two persons and shall meet once each fiscal year, and at such additional
times as it may determine or as is requested by the chief executive officer of
the Company.
1.3 ELIGIBLE PARTICIPANTS
Each member of the Board who is not a full-time employee of the Company or
any of its subsidiaries shall be a participant (a "Participant") in the Plan.
1.4 GRANTS UNDER THE PLAN
Grants under the Plan shall be in the form of stock options as described in
Section II (an "Option" or "Options") and subject to restrictions described in
Section III ("Restricted Stock").
1.5 SHARES
The aggregate number of shares of Common Stock, including but not limited
to shares reserved for issuance pursuant to the exercise of Options, which may
be granted or issued under the terms of the Plan, may not exceed 200,000 shares
and hereby are reserved for such purpose. Whenever any outstanding grant or
portion thereof expires, is canceled or forfeited or is otherwise terminated for
any reason without having been exercised, the Common Stock allocable to the
expired, forfeited, canceled or otherwise terminated portion of the grant may
again be the subject of further grants hereunder.
Notwithstanding the foregoing, the number of shares of Common Stock
available for grants at any time under the Plan shall be reduced to such lesser
amount as may be required pursuant to the methods of calculation necessary so
that the exemptions provided pursuant to Rule 16b-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act") will continue to be
available for transactions involving all current and future grants. In addition,
during the period that any grants remain outstanding under the Plan, the
Committee may make good faith adjustments with respect to the number of shares
of Common Stock attributable to such grants for purposes of calculating the
maximum number of shares of Common Stock available for the granting of future
grants under the Plan, provided that following such adjustments the exemptions
provided pursuant to Rule 16b-3 under the Exchange Act will continue to be
available for transactions involving all current and future grants.
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1.6 DEFINITIONS
The following definitions shall apply to the Plan:
(a) "Disability" shall have the meaning provided in the Company's
applicable disability plan or, in the absence of such a definition, when a
Participant becomes totally disabled (as determined by a physician mutually
acceptable to the Participant and the Company) before termination of his or
her service on the Board if such total disability continues for more than
three (3) months.
(b) "Fair Market Value" means the average of the high and low sales
prices of the shares of Common Stock on such date on the principal national
securities exchange or automated quotation system of a registered
securities association on which such shares of Common Stock are listed or
admitted to trading. If the shares of Common Stock on such date are not
listed or admitted to trading, the Fair Market Value shall be the value
established by the Board in good faith.
(c) "Retirement" shall have the meaning provided in the Company's
retirement policy applicable to directors of the Company.
II. OPTIONS
2.1 TERMS AND CONDITIONS OF OPTIONS
Each Participant shall receive an annual grant of an Option to Purchase
1,500 shares of Common Stock on the date of each annual meeting of shareholders
of the Company at which directors are elected (an "Annual Meeting Date") during
the period such director serves on the Board.
2.2 NONQUALIFIED STOCK OPTIONS
The terms of the Options shall, at the time of grant, provide that the
Options will not be treated as incentive stock options within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
2.3 OPTION PRICE
The option price per share shall be the Fair Market Value of the Common
Stock on the date the Option is granted.
2.4 TERM AND EXERCISE OF OPTIONS
(a) The term of an Option shall not exceed ten (10) years from the date of
grant. Except as provided in this Section 2.4, after a Participant ceases to
serve as a director of the Company for any reason, including, without
limitation, Retirement, or any other voluntary or involuntary termination of a
Participant's service as a director (a "Termination"), the unexercisable portion
of an Option shall immediately terminate and be null and void, and the
unexercised portion of any outstanding Options held by such Participant shall
terminate and be null and void for all purposes, after three (3) months have
elapsed from the date of the Termination unless extended by the Committee, in
its sole discretion, within thirty (30) days from the date of the Termination.
Upon a Termination as a result of death or Disability, any outstanding Options
may be exercised by the Participant or the Participant's legal representative
within twelve (12) months after such death or Disability; provided, however,
that in no event shall the period extend beyond the expiration of the option
term.
(b) Options shall become exercisable in whole or in part after one (1) year
has elapsed from the date of grant. In no event, however, shall an Option be
exercised after the expiration of ten (10) years from the date of grant.
(c) A Participant, by written notice to the Company, may designate one or
more persons (and from time to time change such designation) including his or
her legal representative, who, by reason of his or her death, shall acquire the
right to exercise all or a portion of the Option. If no designation is made
before the death of
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the Participant, the Participant's Option may be exercised by the personal
representative of the Participant's estate, or by a person who acquired the
right to exercise such Option by will or the laws of descent and distribution.
If the person with exercise rights desires to exercise any portion of the
Option, such person must do so in accordance with the terms and conditions of
this Plan.
2.5 NOTICE OF EXERCISE
When exercisable pursuant to the terms of the Plan and the governing stock
option agreement, an Option shall be exercised by the Participant as to all or
part of the shares subject to the Option by delivering written notice of
exercise to the Company at its principal business office or such other office as
the Company may from time to time direct, (a) specifying the number of shares to
be purchased, (b) accompanied by a check payable to the Company in an amount
equal to the full exercise price of the number of shares being exercised, (c)
including a Tax Election, if applicable, in accordance with Section 4.7, and (d)
containing such further provisions consistent with the provisions of the Plan,
as the Company may from time to time prescribe. No Option may be exercised after
the expiration of the term specified in Section 2.4 hereof.
2.6 LIMITATION OF EXERCISE PERIODS
The Committee may limit the time periods within which an Option may be
exercised if a limitation on exercise is deemed necessary in order to effect
compliance with applicable law.
2.7 CHANGE IN CONTROL
Notwithstanding anything herein to the contrary, if a Change in Control has
occurred, then the Option shall immediately become exercisable on the date such
Change in Control occurred.
III. RESTRICTED STOCK
3.1 TERMS AND CONDITIONS
Each Participant shall receive an annual grant of 1,500 shares of Common
Stock subject to the restrictions set forth in Section 3.2 ("Restricted Stock")
on the Annual Meeting Date at which the shareholders elect such Participant to
serve as a director; provided however, that (a) as of the date of their
election, Participants elected to serve as a Class II or Class III director in
1994 shall receive a grant of 500 and 1,000 shares, respectively, and (b) as of
the date of their election, Participants who are elected to fill a vacancy for a
term less than three (3) years shall receive a grant of 500 shares per year for
each full year of the term to which such Participant is elected. Restricted
Stock, with such restrictions noted on the face of the certificates, shall be
issued in the name of the Participant granted the Restricted Stock and such
certificates shall be deposited with a trust administered by the Committee (and
subject to the claims of the Company's creditors) during the restriction period
set forth in Section 3.3.
3.2 RESTRICTIONS
Until the lapse of the restriction period set forth in Section 3.3, the
shares of Restricted Stock granted hereunder may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated. The Committee may
impose such other restrictions on any shares of restricted stock as required by
law including, without limitation, restrictions under applicable federal or
state securities laws, and may place legends on the certificates representing
such restricted stock to provide appropriate notice of such restrictions.
3.3 PERIOD OF RESTRICTION
Subject to Section 3.6, the restrictions set forth in Section 3.2 shall
lapse and such shares shall be freely transferable upon the expiration of the
director's term in office as specified in accordance with Article VIII of the
Company's Amended and Restated Articles of Incorporation.
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3.4 TERMINATION OF SERVICE AS A DIRECTOR
If a Participant ceases to serve as a director of the Company prior to the
lapsing of the restrictions in accordance with Section 3.3 as a result of death,
Disability or Retirement, restrictions on the shares of Restricted Stock granted
to the Participant shall immediately lapse on the date of death, Disability or
Retirement. If a Participant ceases to serve as a director of the Company prior
to the lapsing of restrictions in accordance with Section 3.3 for any reason
other than death, Disability or Retirement, the shares of Restricted Stock
granted to such Participant shall be forfeited and shall revert to the Company.
3.5 RIGHTS AS SHAREHOLDER
Prior to the lapsing of restrictions in accordance with Section 3.3,
Participants holding shares of Restricted Stock shall be entitled to receive all
dividends and other distributions paid with respect to such shares while they
are held by the Participant. If any such dividend or distribution is paid in
shares of Common Stock, such shares shall be subject to the same restrictions on
transferability as the shares of Restricted Stock with respect to which they
were paid.
3.6 CHANGE IN CONTROL
Notwithstanding anything herein to the contrary, if a Change in Control has
occurred, then all restrictions on the Restricted Stock shall lapse on the date
such Change in Control occurred.
3.7 SECTION 83(B) ELECTION
Participants shall not be permitted to make an election under Section 83(b)
of the Code with respect to shares of Restricted Stock granted under the Plan.
IV. GENERAL PROVISIONS
4.1 GENERAL RESTRICTIONS
Each grant under the Plan shall be subject to the requirement that if the
Committee shall determine, at any time, that (a) the listing, registration or
qualification of the shares of Common Stock subject or related thereto upon any
securities exchange or under any state or federal law, or (b) the consent or
approval of any government regulatory body, or (c) an agreement by the
Participant with respect to the disposition of shares of Common Stock, is
necessary or desirable as a condition of, or in connection with, the granting or
the issuance or purchase of shares of Common Stock thereunder, such grant may
not be consummated in whole or in part unless such listing, registration,
qualification, consent, approval or agreement shall have been effected or
obtained free of any conditions not acceptable to the Committee.
4.2 ADJUSTMENTS FOR CHANGES IN CAPITALIZATION
In the event of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, rights offer, liquidation, dissolution, merger,
consolidation, spin-off or sale of assets, or any other change in or affecting
the corporate structure or capitalization of the Company, the Board shall make
such adjustments as the Committee may recommend, and as the Board in its
discretion may deem appropriate, in the number and kind of shares authorized by
the Plan, in the number, Option price or kind of shares covered by the grants
and in any outstanding grants under the Plan in order to prevent substantial
dilution or enlargement thereof.
4.3 AMENDMENTS
Without further approval of the shareholders, the Board may discontinue the
Plan at any time and may amend it from time to time in such respects as the
Board may deem advisable, unless shareholder or regulatory approval is required
by law or regulation, and subject to any conditions established by the terms of
such amendment; provided however, that the Plan may not be amended more than
once every six (6) months
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other than to comport with changes in the Code, the Employee Retirement Income
Security Act or the rules thereunder.
4.4 MODIFICATION, SUBSTITUTION OR CANCELLATION OF GRANTS
No rights or obligations under any outstanding Option may be altered or
impaired without the Participant's consent. Any grant under the Plan may be
canceled at any time with the consent of the Participant, and a new grant may be
provided to such Participant in lieu thereof.
4.5 SHARES SUBJECT TO THE PLAN
Shares distributed pursuant to the Plan shall be made available from
authorized but unissued shares or from shares purchased or otherwise acquired by
the Company for use in the Plan, as shall be determined from time to time by the
Committee.
4.6 RIGHTS OF A SHAREHOLDER
Participants under the Plan, unless otherwise provided by the Plan, shall
have no rights as shareholders by reason thereof unless and until certificates
for shares of Common Stock are issued to them.
4.7 WITHHOLDING
The Company shall have the right to deduct from any distribution of Common
Stock to any Participant an amount equal to the federal, state and local income
taxes and other amounts as may be required by law to be withheld (the
"Withholding Taxes") with respect to any grant under the Plan. If a Participant
is to experience a taxable event in connection with the receipt of cash or
shares of Common Stock pursuant to an Option exercise (a "Taxable Event"), the
Participant shall pay the Withholding Taxes to the Company prior to the issuance
of such shares of Common Stock. In satisfaction of the obligation to pay
Withholding Taxes to the Company, the Participant may make a written election
(the "Tax Election"), which may be accepted or rejected in the discretion of the
Committee, to have withheld a portion of the shares of Common Stock then
issuable to the Participant having an aggregate Fair Market Value on the day
immediately preceding the date of such issuance equal to the Withholding Taxes,
provided that in respect of a Participant who may be subject to liability under
Section 16(b) of the Exchange Act either: (i) in the case of a Taxable Event
involving an Option or a grant of Restricted Stock, (A) the Tax Election is made
at least six (6) months prior to the date of the Taxable Event and (B) the Tax
Election is irrevocable with respect to all Taxable Events of a similar nature
occurring prior to the expiration of six (6) months following a revocation of
the Tax Election; (ii) in the case of the exercise of an Option (A) the
Participant makes the Tax Election at least six (6) months after the date the
Option was granted, (B) the Option is exercised during the ten (10) day period
beginning on the third business day and ending on the twelfth business day
following the release for publication of the Company's quarterly or annual
statement of sales and earnings (the "Window Period") and (C) the Tax Election
is made during the Window Period in which the Option is exercised or prior to
such Window Period and subsequent to the immediately preceding Window Period; or
(iii) in the case of a Taxable Event relating to the payment of an award, (A)
the Participant makes the Tax Election at least six (6) months after the date of
grant and (B) the Tax Election is made (1) in the case of a Taxable Event
occurring within a Window Period, during the Window Period in which the Taxable
Event occurs or (2) in the case of a Taxable Event not occurring within a Window
Period, during the Window Period immediately preceding the Taxable Event.
Notwithstanding the foregoing, the Committee may, by the adoption of rules or
otherwise, (i) modify the provisions of this Section 4.7 as may be necessary to
ensure that the Tax Elections will be exempt transactions under Section 16(b) of
the Exchange Act, and (ii) permit Tax Elections to be made at such other times
and subject to such other conditions as the Committee determines will constitute
exempt transactions under Section 16(b) of the Exchange Act.
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4.8 NONASSIGNABILITY
Except as expressly provided in the Plan, no grant shall be transferable
except by will, the laws of descent and distribution or a qualified domestic
relations order ("QDRO") as defined by the Code or Title I of the Employee
Retirement Income Security Act of 1974, as amended, or the rules thereunder.
During the lifetime of the Participant, except as expressly provided in the
Plan, grants under the Plan shall be exercisable only by such Participant or by
the guardian or legal representative of such Participant or pursuant to a QDRO.
4.9 NONUNIFORM DETERMINATIONS
Determinations by the Committee under the Plan (including, without
limitation, determinations of the persons to receive grants, the form, amount
and timing of such grants, and the terms and provisions of such grants and the
agreements evidencing the same) need not be uniform and may be made by it
selectively among persons who receive, or are eligible to receive, awards under
the Plan, whether or not such persons are similarly situated.
4.10 EFFECTIVE DATE; DURATION
The Plan shall become effective as of the date the Company becomes admitted
to trading on the NASDAQ, subject to approval by the shareholders. No grant may
be given under the Plan after May 31, 2000, but grants theretofore granted may
extend beyond such date.
4.11 CHANGE IN CONTROL
Notwithstanding anything herein to the contrary, if a Change in Control of
the Company occurs, then all Options shall become fully exercisable and all
restrictions on the Restricted Stock shall lapse as of the date such Change in
Control occurred. For the purposes of the Plan, a Change in Control of the
Company shall be deemed to have occurred upon the earliest of the following
events:
(a) when the Company acquires actual knowledge that any person (as
such term is used in Sections 13(d) and 14(d) of the Exchange Act), other
than any person who was the beneficial owner of 25% or more of the Common
Stock as of the effective date of the Plan, becomes the beneficial owner
(as defined in Rule 13d-3 of the Exchange Act) directly or indirectly, of
securities of the Company representing 25% or more of the combined voting
power of the Company's then-outstanding securities;
(b) upon the first purchase of Common Stock pursuant to a tender or
exchange offer (other than a tender or exchange offer made by the Company);
(c) upon the approval by the Company's shareholders of (i) a merger or
consolidation of the Company with or into another corporation (other than a
merger or consolidation in which the Company is the surviving corporation
and which does not result in any capital reorganization or reclassification
or other change in the Company's then-outstanding shares of Common Stock),
(ii) a sale or disposition of all or substantially all of the Company's
assets or (iii) a plan of liquidation or dissolution of the Company; or
(d) if the Board of Directors or any designated committee determines
in its sole discretion that any person (as such term is used in Sections
13(d) and 14(d) of the Exchange Act), other than a person who exercised a
controlling influence as of the effective date of the Plan, directly or
indirectly exercises a controlling influence over the management or
policies of the Company.
4.12 GOVERNING LAW
The Plan and all actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of Florida.
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