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Exhibit 10.1
LANCE, INC.
1995 NONQUALIFIED STOCK OPTION PLAN
FOR NON-EMPLOYEE DIRECTORS
1. PURPOSE. This Plan is intended to provide Directors who are not
employees of the Company a sense of proprietorship and personal involvement in
the development and financial success of the Company and to encourage such
Directors to remain with and to devote their best efforts to the Company.
2. DEFINITIONS. Whenever used in the Plan, unless the context clearly
indicates otherwise, the following terms shall have the following meanings:
(a) "Act" means the Securities Exchange Act of 1934, as amended.
(b) "Board" or "Board of Directors" means the Board of Directors of
the Company.
(c) "Common Stock" means the Common Stock, $.83-1/3 par value, of the
Company and any other stock or securities resulting from the adjustment
thereof or substitution therefor as described in Section 8 below.
(d) "Company" means Lance, Inc., a North Carolina corporation, and any
corporation succeeding to the Company's rights and obligations hereunder.
(e) "Director" means a member of the Board of Directors of the Company
who is not a regular employee of the Company or its subsidiaries.
(f) "Disability" means the condition which results when an individual
has become permanently and totally disabled within the meaning of Section
105(d)(4) of the Internal Revenue Code of 1986.
(g) "Fair Market Value", with respect to a share of the Common Stock
on a particular date, shall be (i) if such Common Stock is listed on a
national securities exchange or a foreign securities exchange or traded on
the National Market System, the closing sale price of the Common Stock on
said date on the national securities exchange, the foreign securities
exchange or the National Market System on which the Common Stock is
principally traded, or, if no sales occur on said date, then on the next
preceding date on which there were such sales of Common Stock, or (ii) if
the Common Stock shall not be listed on a national securities exchange or a
foreign securities exchange or traded on the National Market System, the
mean between the closing bid and asked prices last reported by the National
Association of Securities Dealers, Inc. for the over-the-counter market on
said date or, if no bid and asked prices are reported on said date, then on
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next preceding date on which there were such quotations, or (iii) if at any
time quotations for the Common Stock shall not be reported by the National
Association of Securities Dealers, Inc. for the over-the-counter market and
the Common Stock shall not be listed on any national securities exchange or
any foreign securities exchange or traded on the National Market System,
the fair market value based on quotations for the Common Stock by market
makers or other securities dealers as determined by the Board of Directors
in such manner as the Board may deem reasonable.
(h) "Option" means a stock option granted pursuant to this Plan.
(i) "Optionee" means the person to whom an Option is granted.
(j) "Option Price" is defined in Section 6.
(k) "Plan" means this 1995 Nonqualified Stock Option Plan for
Non-Employee Directors, as in effect from time to time.
(l) "Stock Option Agreement" means the written agreement between an
Optionee and the Company evidencing the grant of an Option under the Plan
and setting forth or incorporating the terms and conditions thereof.
3. ADMINISTRATION. The Plan shall be administered by the Board of
Directors. The Board shall have all of the powers necessary to enable it
properly to carry out its duties under the Plan, including but not limited to
the power and duty to construe and interpret the Plan and to determine all
questions that shall arise under the Plan, which interpretations and
determinations shall be conclusive and binding upon all persons. Subject to the
express provisions of the Plan, the Board may establish from time to time such
regulations, provisions and procedures which in its opinion may be advisable in
the administration of the Plan.
Notwithstanding the foregoing or any other provision of this Plan to the
contrary, no discretion concerning decisions regarding the Plan shall be
afforded to a person who is not a "disinterested person" (as defined in the
rules and regulations of the Securities and Exchange Commission under Section 16
of the Act, as in effect from time to time). In the event that it is necessary
for the proper administration of the Plan to exercise any such discretion, and
the Board is so precluded from exercising such discretion, the Board may
delegate any authority to exercise such discretion to a person or committee of
persons, each of whom is a "disinterested person" as so defined.
4. ELIGIBILITY; OPTION GRANTS. Each Director serving on May 1 of each
calendar year beginning May 1, 1995 shall automatically be granted an option to
purchase shares of the Common Stock on May 1 of such calendar year. The first
such Option for a Director shall be for 2,500 shares and each subsequent Option
shall be for 4,000 shares with the number of shares being subject to adjustment
or substitution as provided in Section 8 hereof; provided, however,
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that such automatic grants shall be made pro rata to all Directors if on the
date of a grant there shall not be a sufficient number of shares of Common Stock
available under the Plan to make all such grants.
5. SHARES AVAILABLE FOR OPTION. The Board of Directors shall reserve for
the purposes of the Plan, and by adoption of the Plan does hereby reserve, out
of the authorized but unissued Common Stock, a total of 100,000 shares of Common
Stock of the Company, subject to adjustment or substitution as provided in
Section 8 hereof. In the event that an Option expires or is terminated
unexercised as to any shares covered thereby, such shares shall not thereafter
be available for the granting of Options under the Plan and the reserve for such
shares shall be terminated.
6. OPTION PRICE. The price at which each share of Common Stock, subject to
adjustment as provided in Section 8 hereof, may be purchased upon the exercise
of an Option (the "Option Price") shall be the Fair Market Value of the shares
of Common Stock subject to the Option on the date such Option is granted.
7. EXERCISE OF OPTIONS.
(a) Each Option by its terms shall require the Optionee granted such
Option to remain available to serve as a Director of the Company for one
year from the date of the grant of such Option before the right to exercise
any part of such Option will accrue; provided, however, the first such
Option granted to a Director by its terms shall require the Optionee to
remain available to serve as a Director of the Company for only six months
from the date of grant of such Option before the right to exercise any part
of such Option will accrue. The Optionee may thereafter exercise any or all
of such option until the expiration or termination of the option; provided,
that not less than 100 shares may be purchased at any one time unless the
number of shares purchased is the total number at such time purchasable
under the Option. Subject to earlier termination as provided herein, all
Options granted shall expire ten years from the date of grant thereof.
(b) If an Optionee shall cease to be a Director otherwise than by such
Optionee's death or Disability, then, subject to Subsection 7(a) hereof,
the Option shall be exercisable at any time prior to the earlier of (i) the
expiration date of such Option or (ii) that date which is three months from
the date such Optionee ceases to be a Director, such three month period to
include the date on which such termination occurs. If an Optionee ceases to
be a Director as a result of such Optionee's death or Disability, then,
subject to Subsection 7(a) hereof, the Option shall be exercisable at any
time prior to the earlier of (i) the expiration date of such option or (ii)
that date which is one year from the date such Optionee ceases to be a
Director.
(c) Each Option by its terms shall not be transferable by the Optionee
otherwise than by will, or if the Optionee dies intestate, by the laws of
descent and
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distribution, and such Option shall be exercisable during such Optionee's
lifetime only by such Optionee. In the event of the death of an Optionee,
then such Optionee's Options shall be exercisable to the extent herein
provided by the executor or personal representative of the Optionee's
estate or by any person who acquired the right to exercise such Option by
bequest under the Optionee's will or by inheritance.
(d) Each Option shall be confirmed by a Stock Option Agreement.
(e) The Option Price for each share of Common Stock purchased pursuant
to the exercise of each Option shall, at the time of the exercise of the
Option, be paid in full in cash or equivalent. An Option shall be deemed
exercised only when written notice of such exercise, together with payment
of the Option Price, is received from the Optionee by the Company at its
principal office. No Optionee shall have any rights as a shareholder of the
Company with respect to Common Stock issuable pursuant to such Optionee's
Option until such Option is duly exercised.
(f) To the extent that an Option is not exercised within the period of
time prescribed therefor as set forth in the Plan, the Option shall lapse
and all rights of the Optionee thereunder shall terminate.
8. ADJUSTMENT OF NUMBER OF SHARES. In the event that a dividend shall be
declared on the Common Stock payable in shares of the Common Stock, the number
of shares of Common Stock subject to grant to each Director each calendar year,
the number of shares then subject to any Option and the number of shares
reserved for issuance pursuant to the Plan shall be adjusted by adding to each
such share the number of shares which would be distributable thereon if such
share had been outstanding on the date fixed for determining the shareholders
entitled to receive such stock dividend. In the event that the outstanding
shares of Common Stock generally shall be changed into or exchanged for a
different number or kind of shares of stock or other securities of the Company
or of another corporation, or changed into or exchanged for cash or property or
the right to receive cash or property (but not including any dividend payable in
cash or property other than a liquidating distribution), whether through
reorganization, recapitalization, stock split-up, combination of shares, merger
or consolidation, then there shall be substituted for each share of Common Stock
subject to grant to each Director each calendar year and subject to any Option,
and for each share of Common Stock reserved for issuance pursuant to the Plan,
the number and kind of shares of stock or other securities or cash or property
or right 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. In
the case of any such substitution or adjustment as provided for in this Section
8, the Option Price for each share covered thereby prior to such substitution or
adjustment shall be the Option Price for all shares of stock or other securities
or cash or property or right to receive cash or property which shall have been
substituted for such share or to which such share shall have been adjusted
pursuant to this Section 8. No adjustment or substitution provided for in this
Section 8 shall require the Company in any Stock Option Agreement to issue a
fractional share and the total substitution or adjustment with respect to each
Stock Option Agreement shall be limited accordingly.
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9. AMENDMENT OF PLAN. The Board of Directors shall have the right to amend,
suspend or terminate the Plan at any time; provided that, except as and to the
extent authorized and permitted by Section 8 above, (a) no amendment, suspension
or termination shall adversely affect the rights of any Optionee as to any
outstanding Option without the consent of such Optionee, subject to any
limitation on such rights set forth in the Plan or such Optionee's Stock Option
Agreement except for any amendment the Board deems necessary to preserve or
provide exemptions from the applicability of Section 16(b) of the Act to the
grant, lapse, disposition, cancellation or exercise of Options; and (b) no
amendment relating to the determination of the Optionees or of the grant dates
or of the number of Options granted to any Optionee, or of the requirement that
no discretion concerning decisions regarding the Plan shall be afforded to a
person who is not a "disinterested person," shall be made more than once every
six months, other than to comport with changes in the Internal Revenue Code of
1986 or the rules thereunder.
10. RESALES OF SHARES. The Company may impose such restrictions on the sale
or other disposition of shares issued pursuant to the exercise of Options as the
Board deems necessary to comply with applicable securities laws. Certificates
for shares issued upon the exercise of Options may bear such legends as the
Company deems necessary to give notice of such restrictions.
11. COMPLIANCE WITH LAW AND OTHER CONDITIONS. No shares shall be issued
pursuant to the exercise of any Option prior to compliance by the Company, to
the satisfaction of its counsel, with any applicable laws. The Company shall not
be obligated to (but may in its discretion) take any action under applicable
federal or state securities laws (including registration or qualification of the
Plan, the Options or the Common Stock) necessary for compliance therewith in
order to permit the issuance of shares upon the exercise of Options or the
immediate resale thereof by Optionees, except for actions (other than
registration or qualification) that may be taken by the Company without
unreasonable effort or expense and without the incurrence of any material
exposure to liability.
12. NONQUALIFIED OPTIONS. Options granted under the Plan will not be
treated as "incentive stock options" under Section 422 of the Internal Revenue
Code of 1986.
13. EFFECTIVE DATE. The Plan shall be effective on February 21, 1995,
subject to approval of the Plan by a plurality of the shares voting on the
approval of the Plan at the 1995 Annual Meeting of Stockholders. Until such
approval shall be obtained, no Options shall be exercisable and if such approval
shall not be obtained prior to the completion of the 1995 Annual Meeting of
Stockholders, this Plan and all Options granted hereunder shall be void.
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