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EXHIBIT 4.3
CONSO PRODUCTS COMPANY
STOCK ELECTION PLAN FOR NON-EMPLOYEE DIRECTORS
1. PURPOSE. This Plan is intended to provide Directors who are not
employees of the Corporation the opportunity to receive all or part of their
compensation for serving as Directors in the form of shares of the Corporation's
Common Stock, thereby encouraging their equity participation in the Corporation,
giving them an additional personal stake in the Corporation's success, and
compensating them in a manner that is tied directly to the interests of the
other shareholders of the Corporation.
2. DEFINITIONS. Whenever used in the Plan, unless the context clearly
indicates otherwise, the following terms shall have the following meanings:
Board or Board of Directors means the Board of Directors of
the Corporation.
Board Approval means approval by both (a) the full Board of
Directors in the manner and to the extent required by applicable law
and the Corporation's bylaws (notwithstanding any participation in such
approval by Non-Employee Directors) and (b) a majority, not less than
two, of the Directors who are not Non-Employee Directors.
Common Stock means the Common Stock of the Corporation.
Compensation Period means the period beginning on the day
immediately following the date of a Quarterly Meeting and ending on
(and including) the date of the next Quarterly Meeting.
Corporation means Conso Products Company, a South Carolina
corporation.
Director means a member of the Board of Directors.
Director Compensation means the retainer fees, meeting
attendance fees, and any other cash compensation (other than
reimbursement of expenses) to which Non-Employee Directors are (without
regard to this Plan) entitled from time to time for their service as
Directors.
Effective Date means the date on which this Plan shall have
been approved by the Board of Directors as set forth in Section 10
below.
Elected Percentage means the percentage of Director
Compensation of a Non-Employee Director elected to be received in the
form of Common Stock pursuant to a Stock Election, or change in an
existing Stock Election, made in accordance with Section 3 below.
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Issuance Date means, with respect to any issuance of Common
Stock pursuant a Stock Election under this Plan that receives Board
Approval at a Quarterly Meeting, the fifth Trading Day after the date
of such Quarterly Meeting (or such other date as may be specified by
the Board of Directors in connection with such Board Approval).
Market Value, with respect to a share of the Common Stock on
any particular date, shall be (i) if such Common Stock is listed on a
national securities exchange or traded on the Nasdaq National Market
System ("NMS"), the closing price per share of the Common Stock on the
national securities exchange (or if traded on more than one such
exchange, the principal exchange on which such shares are traded) or
the NMS on said date or (ii) if the Common Stock shall not be listed on
a national securities exchange or traded on the NMS but shall be traded
in the over-the-counter market and quotations therefor are regularly
reported by Nasdaq, the last price (if such last price is then reported
on a real-time basis) or, if the last price is not then so reported,
the mean between the bid and asked prices last reported, by Nasdaq for
trading on the over-the-counter market on said date, or (iii) if at any
time quotations for the Common Stock shall not be regularly reported by
Nasdaq for the over-the-counter market and the Common Stock shall not
be listed on any national securities exchange or traded on the NMS, the
last price (if such last price is then reported on a real-time basis)
or, if the last price is not then so reported, the mean between the bid
and asked prices last reported, in reports generally available by the
market maker (or if there are more than one market maker on such day,
the average of the amounts determined from each) for such Common Stock
on such day or, if there is no such report by a market maker on such
day or on any of the most recent ten Business Days, the most recent
cash price per share of the Common Stock paid in an arm's length
transaction involving 100 shares or more on or prior to such day which
is ascertained by the Corporation within ten days after such day.
Non-Employee Director means a Director who is not a regular
employee of the Corporation or any of its subsidiaries.
Plan means the Conso Products Company Stock Election Plan for
Non-Employee Directors as set forth in this instrument, as the same may
be amended from time to time.
Quarterly Meeting means a regular quarterly meeting of the
Board of Directors.
Stock Election means an election by a Non-Employee Director to
receive Common Stock in lieu of Director Compensation made in
accordance with Section 3 below.
Trading Day means any day that is not a Saturday, Sunday or
other day on which the principal market for trading in the Common Stock
is closed for trading.
3. ELECTION TO RECEIVE COMMON STOCK IN LIEU OF CASH COMPENSATION. At
any time at or prior to a Quarterly Meeting, beginning with the first Quarterly
Meeting held after the
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Effective Date, a Non-Employee Director may by notice to the Corporation elect,
subject to Board Approval at such Quarterly Meeting, to receive all or part of
his or her Director Compensation that is payable with respect to the
Compensation Period ending on the date of such Quarterly Meeting in the form of
Common Stock, in lieu of payment thereof in cash. Such election (a "Stock
Election") shall specify the percentage of Director Compensation to be received
in the form of Common Stock (the "Elected Percentage") and shall be effective
with respect to the Compensation Period ending on the date of the Quarterly
Meeting at or prior to which such election is made and with respect to each
Compensation Period thereafter until such Non-Employee Director shall have given
notice to the Corporation, at or prior to the Quarterly Meeting held on the last
day of the Compensation Period for which such termination or change is to take
effect, of a termination of such Stock Election or of a change in the Elected
Percentage previously elected.
Notice of a Stock Election, or of any change in the Elected Percentage,
or of termination of a Stock Election previously made, shall be given to the
Corporation, at or prior to the vote of the Board of Directors at the Quarterly
Meeting on Board Approval of the issuance of Common Stock pursuant to Stock
Elections, either (a) orally at such Quarterly Meeting, or (b) in writing,
substantially in the form of Exhibit 1 hereto or such other form as is
reasonably satisfactory to the Board of Directors.
At each Quarterly Meeting, the Board of Directors shall consider Board
Approval of the issuance of the shares of Common Stock that each Non-Employee
Director has, pursuant to his or her Stock Election, elected to receive in lieu
of payment in cash of his or her Director Compensation for the Compensation
Period ending on the date of such Quarterly Meeting. If a Non-Employee Director
has not made such a Stock Election, or to the extent of that portion of his or
her Director Compensation not covered by a Stock Election, or if such Board
Approval is not obtained, his or her Director Compensation for such Compensation
Period (or the percentage thereof other than the Elected Percentage) will be
paid in cash as soon as practicable after such Quarterly Meeting.
4. ISSUANCE OF SHARES PURSUANT TO STOCK ELECTION; RESERVATION OF
SHARES. If the issuance of shares of Common Stock pursuant to a Stock Election
made by a Non-Employee Director hereunder receives Board Approval at a Quarterly
Meeting, then, as of the Issuance Date with respect such Quarterly Meeting, the
Corporation shall issue to such Non-Employee Director, in lieu of the applicable
Elected Percentage of Director Compensation that would otherwise have been
payable in cash to such Non-Employee Director for the Compensation Period ending
on the date of such Quarterly Meeting, that number of whole shares of Common
Stock (with any fractional share rounded up to a whole share) equal to (A) the
Elected Percentage of such Non-Employee Director's Director Compensation payable
with respect to such Compensation Period, divided by (B) 90% of the Market Value
per share of the Common Stock on such Issuance Date. Notwithstanding the
foregoing, if on the Issuance Date the person to whom shares would otherwise be
issued hereunder is no longer a Director of the Corporation, then such shares
shall not be issued and such person shall receive any Director Compensation to
which he or she is entitled for the previous Compensation Period in the form of
cash.
The shares of Common Stock issued under this Plan need not be
represented by a certificate; provided, that upon the request of the holder of
any such shares not represented by a certificate, the corporation shall promptly
cause a certificate or certificates for such shares to
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be issued. If certificates for such shares are not issued, then within a
reasonable time after such shares are issued the Corporation shall send to the
Non-Employee Director to whom such shares were issued a written statement, which
may be substantially in the form of Exhibit 2 hereto, setting forth the number
of shares so issued and the other information required by applicable law, with a
copy to the registrar and transfer agent for the Common Stock for entry on the
Corporation's stock records.
The Board of Directors hereby reserves for the purposes of the Plan,
out of the authorized but unissued Common Stock, a total of 25,000 shares of
Common Stock (or the number and kind of shares of stock or other securities
which, in accordance with Section 5 of the Plan, shall be substituted for such
number of shares or to which such number of shares shall be adjusted, or such
greater number of shares as the Board of Directors may hereafter reserve
hereunder by resolution). The number of shares of Common Stock that may be
issued hereunder shall not exceed such number (subject to adjustment in
accordance with said Section 5 or increase by action of the Board of Directors).
If at any time there would otherwise be issued hereunder shares of the Common
Stock, the issuance of which would cause the aggregate number of shares issued
hereunder to exceed such number, then only those shares so reserved and
available for issuance hereunder shall be issued (pro rata to the Non-Employee
Directors in accordance with the respective numbers of shares otherwise issuable
to them hereunder), any accrued Director Compensation which (but for such
limitation) would be paid in shares of Common Stock shall instead be paid in
cash, and this Plan shall thereupon terminate.
5. ADJUSTMENTS. In the event that after the Effective Date a dividend
shall be declared upon the Common Stock payable in shares of Common Stock or
other securities of the Corporation, the number of shares reserved for issuance
pursuant to the Plan but not yet issued shall be adjusted by adding to each such
share the number of shares or other securities of the Corporation which would be
distributable thereon if such share had been outstanding on the date fixed for
determining the shareholders entitled to receive such dividend in shares or
other securities. In the event that after the Effective Date the outstanding
shares of Common Stock shall be changed into or exchanged for a different number
or kind of shares of stock or other securities of the Corporation or of another
corporation, or into or for the right to receive cash or other property
(otherwise than as a dividend or other distribution by the Corporation of cash
or property), whether through reorganization, recapitalization, stock split-up,
combination of shares, merger, consolidation or statutory share exchange, then
there shall be substituted for each share of Common Stock reserved for issuance
pursuant to the Plan but not yet issued, the number and kind of shares of stock
or other securities or rights to receive cash or property into which each
outstanding share of Common Stock shall be so changed or for which each such
share shall be exchanged. No adjustment or substitution provided for in this
Section 5 shall require the Corporation to issue a fractional share and the
total substitution or adjustment shall be limited accordingly.
If any shares are issuable hereunder after a record date for, but
before the payment, distribution or effective date for, any share dividend,
stock split or other similar capital change, so that the fair value of the
shares so issuable after such record date would not be comparable to the Market
Value of the outstanding shares of Common Stock used in calculating the number
of shares to be so issued (e.g., a Market Value which does not yet reflect a
stock split for which the record date was prior to the Issuance Date), then
equitable adjustment shall be made in the number of shares to be so issued so
that the value of the shares so issued, on the effective date
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of their issuance, would be fairly comparable to the Market Value of the
outstanding shares used in calculating such number of shares.
6. AMENDMENT AND TERMINATION OF PLAN. The Board of Directors shall have
the right to amend, suspend or terminate the Plan at any time, provided that no
such amendment or termination shall affect any shares previously issued
hereunder. The Plan shall terminate automatically upon the issuance of all of
the shares of Common Stock reserved for issuance hereunder.
7. COMPLIANCE WITH LAW AND OTHER CONDITIONS. No shares shall be issued
pursuant to the Plan prior to compliance by the Corporation with any applicable
laws and regulations relating thereto, including without limitation applicable
federal and state laws relating to the sale of securities. In addition, if at
the time of the issuance of any shares hereunder, the Corporation is required to
withhold any taxes with respect to the Common Stock so issued, the Corporation
shall not be required to issue such shares unless and until satisfactory
arrangements have been made with the Corporation to provide sufficient funds in
cash for the Corporation to meet such withholding requirements, and the
Corporation shall have no obligation to advance any of its own funds for such
purpose.
8. ADMINISTRATION. This Plan shall be administered in accordance with
the terms hereof by the proper officers of the Corporation. If any issue shall
arise as to the interpretation, operation or administration of this Plan, such
issue shall be resolved by the Board of Directors, and the determination of the
Board pursuant to Board Approval shall be final and binding.
9. NO ASSIGNMENT. No Non-Employee Director may assign any of his or her
rights or interests under the Plan, all rights and interests hereunder being
personal to the respective Non-Employee Directors. Nothing herein shall limit
the ability of any person receiving shares of the Common Stock pursuant to the
Plan to assign and transfer such shares after they are issued hereunder, subject
to any restrictions on transfer imposed by applicable law.
10. EFFECTIVE DATE. The Plan has been adopted and approved by Board
Approval of the Board of Directors on January 28, 1997.
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EXHIBIT 1
CONSO PRODUCTS COMPANY
STOCK ELECTION PLAN FOR NON-EMPLOYEE DIRECTORS
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STOCK ELECTION, CHANGE OR TERMINATION FORM
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To: Conso Products Company
P.O. Box 326
513 North Duncan Bypass
Union, South Carolina 29379
Ladies and Gentlemen:
Pursuant to the Stock Election Plan for Non-Employee Directors (the
"Plan"; all capitalized terms used herein and not otherwise defined herein
having the meanings ascribed to them in the Plan) of Conso Products Company (the
"Corporation"), the undersigned Non-Employee Director hereby makes a Stock
Election, changes his or her Elected Percentage that was designated in a
previous Stock Election, or terminates his or her Stock Election, effective for
the Compensation Period that includes the date hereof and for all Compensation
Periods thereafter until a change or termination of this election shall become
effective, as follows (check applicable box and complete):
[ ] INITIAL STOCK ELECTION. Pursuant to the Plan, I hereby make a Stock
Election. The applicable Elected Percentage of my Director Compensation
to be received in the form of Common Stock is:
[ ]100% [ ] Other:__________% (specify percentage).
[ ] CHANGE IN ELECTED PERCENTAGE. I have heretofore made a Stock Election
and hereby elect to change my Elected Percentage to:
[ ] 100% [ ] Other:__________% (specify percentage).
[ ] TERMINATION OF STOCK ELECTION. I hereby terminate my Stock Election and
request that all of my Director Compensation be paid to me in cash
unless and until I hereafter elect to again participate in the Plan.
I hereby acknowledge that I have received a copy of the Prospectus for
the Plan (which includes a copy of the Plan) and a copy of the Corporation's
most recent Annual Report to Shareholders.
Date:
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(Signature of Non-Employee Director)
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(Typed or Printed Name)
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EXHIBIT 2
CONSO PRODUCTS COMPANY
NOTICE OF ISSUANCE OF SHARES PURSUANT TO
STOCK ELECTION PLAN FOR NON-EMPLOYEE DIRECTORS
To:
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Address:
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(Taxpayer Identification Number)
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Issuance Date Total Director
- -------------------------------------- Compensation for $
Number of Shares Issued Compensation Period
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Market Value per Share $ Elected Percentage %
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Total Market Value of $ Director Compensation $
Shares Issued Paid in Shares
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Pursuant to the Stock Election Plan for Non-Employee Directors (the
"Plan"; all capitalized terms used herein and not otherwise defined herein
having the meanings ascribed to them in the Plan) of Conso Products Company, a
South Carolina corporation (the "Corporation"), there have been issued to you,
as of the Issuance Date set forth above, the number of shares of the Common
Stock of the Corporation set forth above. The number of shares so issued was
determined in accordance with the Plan based upon your applicable Elected
Percentage of your Director Compensation accrued during the Compensation Period
ended on the date of the last Quarterly Meeting prior to the Issuance Date and
the Market Value per share of the Common Stock on such Issuance Date, all as set
forth above.
Certificates for these shares will not be issued to you unless you so
request, but appropriate entry on the Corporation's stock records will be made
to reflect your ownership of these shares as of the Issuance Date. Upon your
request, the Corporation will cause certificates for such shares to be issued to
you.
In addition to the Common Stock, the Corporation is authorized by its
articles of incorporation to issue Preferred Stock and may hereafter be
authorized to issue shares of other classes, or of different series within
classes. The Corporation will furnish each shareholder upon request without
charge a written statement of the designations, relative rights, preferences and
limitations applicable to each class and the variations thereof applicable to
each series, and the authority of the Board of Directors to determine variations
for future series, of all such shares.
A copy of this Notice is being sent to the Corporation's registrar and
transfer agent for the Common Stock, who is hereby directed to make appropriate
entries in the Corporation's stock records and record the issuance of the Shares
in uncertificated form as of the Issuance Date from the shares of Common Stock
reserved for issuance pursuant to the Plan.
CONSO PRODUCTS COMPANY
By
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Title:
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cc: First Union National Bank of North Carolina