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EXHIBIT 10.9
ENVOY CORPORATION
1998 EXPRESSBILL STOCK OPTION PLAN
SECTION 1. Purpose; Definitions.
The purpose of the Envoy Corporation 1998 ExpressBill Stock Option Plan
(the "Plan") is to enable Envoy Corporation (the "Corporation") to attract,
retain and reward employees of the Corporation and its Subsidiaries and
Affiliates, and to strengthen the mutuality of interests between such employees
by awarding such employees performance-based stock options in the Corporation.
The creation and implementation of the Plan will not diminish or prejudice other
compensation plans or programs approved from time to time by the Board.
For purposes of the Plan, the following terms shall be defined as set forth
below:
A. "Affiliate" means any entity other than the Corporation and its
Subsidiaries that is designated by the Board as a participating employer under
the Plan, provided that the Corporation directly or indirectly owns at least 20%
of the combined voting power of all classes of stock of such entity or at least
20% of the ownership interests in such entity.
B. "Board" means the Board of Directors of the Corporation.
C. "Cause" has the meaning provided in Section 5(j) of the Plan.
D. "Change in Control" has the meaning provided in Section 6(b) of the
Plan.
E. "Change in Control Price" has the meaning provided in Section 6(d) of
the Plan.
F. "Common Stock" means the Corporation's Common Stock, no par value per
share.
G. "Code" means the Internal Revenue Code of 1986, as amended from time to
time, and any successor thereto.
H. "Committee" means the Committee referred to in Section 2 of the Plan.
I. "Corporation" means Envoy Corporation, a corporation organized under the
laws of the State of Tennessee, or any successor corporation.
J. "Disability" means disability as determined under the Corporation's
Group Long Term Disability Insurance Plan.
K. "Early Retirement" means retirement, for purposes of this Plan with the
express consent of the Corporation at or before the time of such retirement,
from active employment with the Corporation and any Subsidiary or Affiliate
prior to age 65, in accordance with any applicable early retirement policy of
the Corporation then in effect or as may be approved by the Committee.
L. "Effective Date" has the meaning provided in Section 10 of the Plan.
M. "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor thereto.
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N. "Fair Market Value" means with respect to the Common Stock, as of any
given date or dates, unless otherwise determined by the Committee in good faith,
the reported closing price of a share of Common Stock on Nasdaq or such other
market or exchange as is the principal trading market for the Common Stock, or,
if no such sale of a share of Common Stock is reported on Nasdaq or other
exchange or principal trading market on such date, the fair market value of a
share of Common Stock as determined by the Committee in good faith.
O. "Incentive Stock Option" means any Stock Option intended to be and
designated as an "Incentive Stock Option" within the meaning of Section 422 of
the Code.
P. "Immediate Family" means any child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and shall include
adoptive relationships.
Q. "Nasdaq" means The Nasdaq Stock Market.
R. "Non-Employee Director" means a member of the Board who is a
Non-Employee Director within the meaning of Rule 16b-3(b)(3) promulgated under
the Exchange Act and an outside director within the meaning of Treasury
Regulation Sec. 162-27(e)(3) promulgated under the Code.
S. "Non-Qualified Stock Option" means any Stock Option that is not an
Incentive Stock Option.
T. "Normal Retirement" means retirement from active employment with the
Corporation and any Subsidiary or Affiliate on or after age 65.
U. "Performance Goals" means performance goals based on one or more of the
following criteria: (i) pre-tax income or after-tax income; (ii) operating cash
flow; (iii) operating profit; (iv) return on equity, assets, capital, or
investment; (v) earnings or book value per share; (vi) sales or revenues; (vii)
operating expenses; (viii) Common Stock price appreciation; and (ix)
implementation, management, or completion of critical projects or processes.
Where applicable, the Performance Goals may be expressed in terms of attaining a
specified level of the particular criteria or the attainment of a percentage
increase or decrease in the particular criteria, and may be applied to one or
more of the Corporation or any Subsidiary, or a division or strategic business
unit of the Corporation, or may be applied to the performance of the Corporation
relative to a market index, a group of other companies, or a combination
thereof, all as determined by the Committee. The Performance Goals may include a
threshold level of performance below which no payment will be made (or no
vesting will occur), levels of performance at which specified payments will be
made (or specified vesting will occur), and a maximum level of performance above
which no additional payment will be made (or at which full vesting will occur).
Each of the foregoing Performance Goals shall be determined, to the extent
applicable, in accordance with generally accepted accounting principles and
shall be subject to certification by the Committee; provided, that the Committee
shall have the authority to make equitable adjustments to the Performance Goals
in recognition of unusual or non-recurring events affecting the Corporation or
any Subsidiary or the financial statements of the Corporation or any Subsidiary,
in response to changes in applicable laws or regulations, or to account for
items of gain, loss, or expense determined to be extraordinary or unusual in
nature or infrequent in occurrence or related to the disposal of a segment of
business or related to a change in accounting principles.
V. "Plan" means this Envoy Corporation 1998 ExpressBill Stock Option Plan,
as amended from time to time.
W. "Retirement" means Normal or Early Retirement.
X. "Stock Option" or "Option" means any option to purchase shares of Common
Stock granted pursuant to Section 5 below.
Y. "Subsidiary" means any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the Corporation if each of the
corporations (other than the last corporation in the
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unbroken chain) owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in the chain.
SECTION 2. Administration.
Except as provided below, the Plan shall be administered by a Committee of
not less than two Non- Employee Directors, who shall be appointed by the Board
and who shall serve at the pleasure of the Board. The functions of the Committee
specified in the Plan may be exercised by an existing Committee of the Board
composed exclusively of Non-Employee Directors. The initial Committee shall be
the Compensation Committee of the Board. In the event there are not at least two
Non-Employee Directors on the Board, the Plan shall be administered by the
entire Board and all references herein to the Committee shall refer to the
Board.
The Committee shall have the power to delegate authority to the
Corporation's Chief Executive Officer, or to a committee composed of executive
officers of the Corporation, to grant, on behalf of the Committee, Non-
Qualified Stock Options exercisable at Fair Market Value on the date of grant,
subject to such guidelines as the Committee may determine from time to time;
provided, however that (i) options may only be granted pursuant to such
delegated authority for the purposes specified by the Committee, which may
include attracting new employees, awarding outstanding performance, or retaining
employees, (ii) the Committee shall specify the maximum number of shares that
may be granted for purposes of attracting any single new employee at any
specified level and the maximum number that may be granted to any other employee
for any other purpose, (iii) options to purchase no more than 50,000 shares may
be granted in any fiscal year pursuant to such delegated authority, and (iv) a
report of each grant of an option pursuant to such delegated authority shall be
presented to the Committee at the first meeting of the Committee following such
grant. Options granted pursuant to such delegated authority in accordance
herewith shall be deemed, to the extent permitted under applicable law, to have
been granted by the Committee for all purposes under the Plan.
The Committee shall have authority to grant Stock Options pursuant to the
terms of the Plan, to employees eligible under Section 4.
In particular, the Committee, or the Board, as the case may be, shall have
the authority, consistent with the terms of the Plan:
(a) to select the employees of the Corporation and its Subsidiaries and
Affiliates to whom Stock Options may from time to time be granted hereunder;
(b) to determine whether and to what extent Non-Qualified Stock Options are
to be granted hereunder to one or more eligible persons;
(c) to determine the number of shares to be covered by each such award
granted hereunder;
(d) to determine the terms and conditions, not inconsistent with the terms
of the Plan, of any award granted hereunder (including, but not limited to, the
share price and any restriction or limitation, or any vesting acceleration or
waiver of forfeiture restrictions regarding any Stock Option and/or the shares
of Common Stock relating thereto, based in each case on such factors as the
Committee shall determine, in its sole discretion); and to amend or waive any
such terms and conditions to the extent permitted by Section 7 hereof;
(e) to determine whether and under what circumstances a Stock Option may be
settled in cash or restricted stock under Section 5(k) or (l), as applicable,
instead of Common Stock;
(f) to determine the terms, conditions, and restrictions of any Performance
Goals and the number of Options subject thereto; and
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(g) to determine whether to require payment of tax withholding requirements
in shares of Common Stock subject to the award.
The Committee shall have the authority to adopt, alter, and repeal such
rules, guidelines, and practices governing the Plan as it shall, from time to
time, deem advisable; to interpret the terms and provisions of the Plan and any
award issued under the Plan (and any agreements relating thereto); and to
otherwise supervise the administration of the Plan; and, except as expressly set
forth herein or otherwise required by law, all decisions made by the Committee
pursuant to the provisions of the Plan shall be made in the Committee's sole
discretion and shall be final and binding on all persons, including the
Corporation and Plan participants.
SECTION 3. Shares of Common Stock Subject to Plan.
(a) As of the Effective Date, the aggregate number of shares of Common
Stock that may be issued under the Plan shall be 300,000 shares. The shares of
Common Stock issuable under the Plan may consist, in whole or in part, of
authorized and unissued shares or treasury shares.
(b) If any shares of Common Stock that have been optioned cease to be
subject to a Stock Option or any such award otherwise terminates without a
payment being made to the participant in the form of Common Stock, such shares
shall again be available for distribution in connection with future awards under
the Plan.
(c) In the event of any merger, reorganization, consolidation,
recapitalization, extraordinary cash dividend, stock dividend, stock split or
other change in corporate structure affecting the Common Stock, an appropriate
substitution or adjustment shall be made in the maximum number of shares that
may be awarded under the Plan, in the number and option price of shares subject
to outstanding Options granted under the Plan, in the Performance Goals, as may
be determined to be appropriate by the Committee, in its sole discretion,
provided that the number of shares subject to any award shall always be a whole
number.
SECTION 4. Eligibility.
Employees of the Corporation and its Subsidiaries and Affiliates who are
responsible for or contribute to the management, growth and/or profitability of
the business of the Corporation and/or its Subsidiaries and Affiliates are
eligible to be granted awards under the Plan.
SECTION 5. Stock Options.
Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.
Stock Options granted under the Plan will be Non-Qualified Stock Options.
No Incentive Stock Options may be granted pursuant to this Plan.
Options granted to employees under the Plan shall be subject to the
following terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Committee shall
deem desirable.
(a) Option Price. The option price per share of Common Stock purchasable
under a Stock Option shall be determined by the Committee at the time of grant
but shall be not less than 50% of the Fair Market Value of the Common Stock at
grant.
(b) Option Term. The term of each Stock Option shall be fixed by the
Committee.
(c) Exercisability. Stock Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by the
Committee at or after grant. The Committee may provide
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that a Stock Option shall vest over a period of future service at a rate
specified at the time of grant, or that the Stock Option is exercisable only in
installments. If the Committee provides, in its sole discretion, that any Stock
Option is exercisable only in installments, the Committee may waive such
installment exercise provisions at any time at or after grant, in whole or in
part, based on such factors as the Committee shall determine in its sole
discretion.
(d) Method of Exercise. Subject to whatever installment exercise
restrictions apply under Section 5(c), Stock Options may be exercised in whole
or in part at any time during the option period, by giving written notice of
exercise to the Corporation specifying the number of shares to be purchased.
Such notice shall be accompanied by payment in full of the purchase price,
either by check, note, or such other instrument as the Committee may accept. As
determined by the Committee, in its sole discretion, at or after grant, payment
in full or in part may also be made in the form of shares of Common Stock
already owned by the optionee or shares of restricted stock or shares subject to
such Option or another award hereunder (in each case valued at the Fair Market
Value of the Common Stock on the date the Option is exercised). If payment of
the exercise price is made in part or in full with Common Stock, the Committee
may award to the employee a new Stock Option to replace the Common Stock which
was surrendered. If payment of the option exercise price of a Non-Qualified
Stock Option is made in whole or in part in the form of restricted stock, such
restricted stock (and any replacement shares relating thereto) shall remain (or
be) restricted in accordance with the original terms of the restricted stock
award in question, and any additional Common Stock received upon the exercise
shall be subject to the same forfeiture restrictions, unless otherwise
determined by the Committee, in its sole discretion, at or after grant. No
shares of Common Stock shall be issued until full payment therefor has been
made. An optionee shall generally have the rights to dividends or other rights
of a shareholder with respect to shares subject to the Option when the optionee
has given written notice of exercise, has paid in full for such shares, and, if
requested, has given the representation described in Section 9(a).
(e) Transferability of Options. No Non-Qualified Stock Option shall be
transferable by the optionee without the prior written consent of the Committee
other than (i) transfers by the Optionee to a member of his or her Immediate
Family or a trust for the benefit of the optionee or a member of his or her
Immediate Family, or (ii) transfers by will or by the laws of descent and
distribution.
(f) Bonus for Taxes. The Committee in its discretion may award at the time
of grant or thereafter the right to receive upon exercise of such Stock Option a
cash bonus calculated to pay part or all of the federal and state, if any,
income tax incurred by the optionee upon such exercise.
(g) Termination by Death. Subject to Section 5(k), if an optionee's
employment by the Corporation and any Subsidiary or Affiliate terminates by
reason of death, any Stock Option held by such optionee may thereafter be
exercised, to the extent such option was exercisable at the time of death or on
such accelerated basis as the Committee may determine at or after grant by the
legal representative of the estate or by the legatee of the optionee under the
will of the optionee, for a period of one year (or such other period as the
Committee may specify at or after grant) from the date of such death or until
the expiration of the stated term of such Stock Option, whichever period is the
shorter.
(h) Termination by Reason of Disability. Subject to Section 5(k), if an
optionee's employment by the Corporation and any Subsidiary or Affiliate
terminates by reason of Disability, any Stock Option held by such optionee may
thereafter be exercised by the optionee, to the extent it was exercisable at the
time of termination or on such accelerated basis as the Committee may determine
at or after grant, for a period of three years (or such other period as the
Committee may specify at or after grant) from the date of such termination of
employment or until the expiration of the stated term of such Stock Option,
whichever period
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is the shorter; provided however, that, if the optionee dies within the period
specified above (or other such period as the Committee shall specify at or after
grant), any unexercised Stock Option held by such optionee shall thereafter be
exercisable to the extent to which it was exercisable at the time of death for a
period of twelve months from the date of such death or until the expiration of
the stated term of such Stock Option, whichever period is shorter.
(i) Termination by Reason of Retirement. Subject to Section 5(k), if an
optionee's employment by the Corporation and any Subsidiary or Affiliate
terminates by reason of Normal or Early Retirement, any Stock Option held by
such optionee may thereafter be exercised by the optionee, to the extent it was
exercisable at the time of such Retirement or on such accelerated basis as the
Committee may determine at or after grant, for a period of three years (or such
other period as the Committee may specify at or after grant) from the date of
such termination of employment or the expiration of the stated term of such
Stock Option, whichever period is the shorter; provided however, that, if the
optionee dies within the period specified above (or other such period as the
Committee shall specify at or after grant), any unexercised Stock Option held by
such optionee shall thereafter be exercisable to the extent to which it was
exercisable at the time of death for a period of twelve months from the date of
such death or until the expiration of the stated term of such Stock Option,
whichever period is shorter.
(j) Other Termination. Subject to Section 5(k), unless otherwise determined
by the Committee (or pursuant to procedures established by the Committee) at or
after grant, if an optionee's employment by the Corporation and any Subsidiary
or Affiliate is involuntarily terminated for any reason other than death,
Disability or Normal or Early Retirement, the Stock Option shall thereupon
terminate, except that such Stock Option may be exercised, to the extent
otherwise then exercisable, for the lesser of three months or the balance of
such Stock Option's term if the involuntary termination is without Cause. For
purposes of this Plan, "Cause" means (i) a felony conviction of a participant or
the failure of a participant to contest prosecution for a felony, or (ii) a
participant's willful misconduct or dishonesty, which is directly and materially
harmful to the business or reputation of the Corporation or any Subsidiary or
Affiliate, in each case as determined by the Committee, in its sole direction.
If an optionee voluntarily terminates employment with the Corporation and any
Subsidiary or Affiliate (except for Disability, Normal or Early Retirement), the
Stock Option shall thereupon terminate; provided, however, that the Committee at
grant or thereafter may extend the exercise period in this situation for the
lesser of three months or the balance of such Stock Option's term.
(k) Buyout Provisions. The Committee may at any time offer to buy out for a
payment in cash, Common Stock, or restricted stock an Option previously granted,
based on such terms and conditions as the Committee shall establish and
communicate to the optionee at the time that such offer is made.
(l) Settlement Provisions. If the option agreement so provides at grant or
is amended after grant and prior to exercise to so provide (with the optionee's
consent), the Committee may require that all or part of the shares to be issued
with respect to the spread value of an exercised Option take the form of
restricted stock, which shall be valued on the date of exercise on the basis of
the Fair Market Value (as determined by the Committee) of such restricted stock
determined without regards to the forfeiture restrictions involved.
(m) Performance and Other Conditions. The Committee may condition the
exercise of any Option upon the attainment of specified Performance Goals or
other factors as the Committee may determine, in its sole discretion. Unless
specifically provided in the option agreement, any such conditional Option shall
vest six months prior to its expiration if the conditions to exercise have not
theretofore been satisfied.
SECTION 6. Change in Control Provisions.
(a) Impact of Event. In the event of:
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(1) a "Change in Control" as defined in Section 6(b); or
(2) a "Potential Change in Control" as defined in Section 6(c), but only if
and to the extent so determined by the Committee or the Board at or after grant
(subject to any right of approval expressly reserved by the Committee or the
Board at the time of such determination);
(i) subject to the limitations set forth below in this Section 6(a), the
following acceleration provisions shall apply:
Any Stock Option awarded under the Plan not previously exercisable and
vested shall become fully exercisable and vested.
(ii) subject to the limitations set forth below in this Section 6(a), the
value of all outstanding Stock Options, to the extent vested, shall, unless
otherwise determined Board or by the Committee in its sole discretion prior to
any Change in Control, be cashed out on the basis of the "Change in Control
Price" as defined in Section 6(d) as of the date such Change in Control or such
Potential Change in Control is determined to have occurred or such other date as
the Board or Committee may determine prior to the Change in Control.
(iii) The Board or the Committee may impose additional conditions on the
acceleration or valuation of any award in the award agreement.
(b) Definition of Change in Control. For purposes of Section 6(a), a
"Change in Control" means the happening of any of the following:
(i) any person or entity, including a "group" as defined in Section
13(d)(3) of the Exchange Act, other than the Corporation or a wholly-owned
subsidiary thereof or any employee benefit plan of the Corporation or any of its
Subsidiaries, becomes the beneficial owner of the Corporation's securities
having 35% or more of the combined voting power of the then outstanding
securities of the Corporation that may be cast for the election of directors of
the Corporation (other than as a result of an issuance of securities initiated
by the Corporation in the ordinary course of business); or
(ii) as the result of, or in connection with, any cash tender or exchange
offer, merger or other business combination, sales of assets or contested
election, or any combination of the foregoing transactions, less than a majority
of the combined voting power of the then outstanding securities of the
Corporation or any successor corporation or entity entitled to vote generally in
the election of the directors of the Corporation or such other corporation or
entity after such transaction are held in the aggregate by the holders of the
Corporation's securities entitled to vote generally in the election of directors
of the Corporation immediately prior to such transaction; or
(iii) during any period of two consecutive years, individuals who at the
beginning of any such period constitute the Board cease for any reason to
constitute at least a majority thereof, unless the election, or the nomination
for election by the Corporation's shareholders, of each director of the
Corporation first elected during such period was approved by a vote of at least
two-thirds of the directors of the Corporation then still in office who were
directors of the Corporation at the beginning of any such period.
(c) Definition of Potential Change in Control. For purposes of Section
6(a), a "Potential Change in Control" means the happening of any one of the
following:
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(i) The approval by shareholders of an agreement by the Corporation, the
consummation of which would result in a Change in Control of the Corporation as
defined in Section 6(b); or
(ii) The acquisition of beneficial ownership, directly or indirectly, by
any entity, person or group (other than the Corporation or a Subsidiary or any
Corporation employee benefit plan (including any trustee of such plan acting as
such trustee)) of securities of the Corporation representing 5% or more of the
combined voting power of the Corporation's outstanding securities and the
adoption by the Committee of a resolution to the effect that a Potential Change
in Control of the Corporation has occurred for purposes of this Plan.
(d) Change in Control Price. For purposes of this Section 6, "Change in
Control Price" means the highest price per share paid in any transaction
reported on Nasdaq or such other exchange or market as is the principal trading
market for the Common Stock, or paid or offered in any bona fide transaction
related to a Potential or actual Change in Control of the Corporation at any
time during the 60 day period immediately preceding the occurrence of the Change
in Control (or, where applicable, the occurrence of the Potential Change in
Control event), in each case as determined by the Committee except that, in the
case of Incentive Stock Options and Stock Appreciation Rights relating to
Incentive Stock Options, such price shall be based only on transactions reported
for the date on which the optionee exercises such Stock Appreciation Rights or,
where applicable, the date on which a cash out occurs under Section 6(a)(ii).
SECTION 7. Amendments and Termination.
The Board may at any time amend, alter or discontinue the Plan without
shareholder approval to the fullest extent permitted by the Exchange Act and the
Code; provided, however, that no amendment, alteration, or discontinuation shall
be made which would impair the rights of an optionee or participant under a
Stock Option theretofore granted, without the participant's consent.
The Committee may amend the terms of any Stock Option or other award
theretofore granted, prospectively or retroactively, but, subject to Section 3
above, no such amendment shall impair the rights of any holder without the
holder's consent. The Committee may also substitute new Stock Options for
previously granted Stock Options (on a one for one or other basis), including
previously granted Stock Options having higher option exercise prices.
SECTION 8. Unfunded Status of Plan.
The Plan is intended to constitute an "unfunded" plan for incentive and
deferred compensation. With respect to any payments not yet made to a
participant or optionee by the Corporation, nothing contained herein shall give
any such participant or optionee any rights that are greater than those of a
general creditor of the Corporation. In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Common Stock or payments in lieu of or with
respect to awards hereunder; provided, however, that, unless the Committee
otherwise determines with the consent of the affected participant, the existence
of such trusts or other arrangements is consistent with the "unfunded" status of
the Plan.
SECTION 9. General Provisions.
(a) The Committee may require each person purchasing shares pursuant to a
Stock Option to represent to and agree with the Corporation in writing that the
optionee or participant is acquiring the shares without a view to distribution
thereof. The certificates for such shares may include any legend which the
Committee deems appropriate to reflect any restrictions on transfer. All
certificates for shares of Common Stock or other securities delivered under the
Plan shall be subject to such stop-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of the Commission, any stock exchange upon which the Common Stock
is then listed, and any applicable
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Federal or state securities law, and the Committee may cause a legend or legends
to be put on any such certificates to make appropriate reference to such
restrictions.
(b) Nothing contained in this Plan shall prevent the Board from adopting
other or additional compensation arrangements, subject to shareholder approval
if such approval is required; and such arrangements may be either generally
applicable or applicable only in specific cases.
(c) The adoption of the Plan shall not confer upon any employee of the
Corporation or any Subsidiary or Affiliate any right to continued employment
with the Corporation or a Subsidiary or Affiliate, as the case may be, nor shall
it interfere in any way with the right of the Corporation or a Subsidiary or
Affiliate to terminate the employment of any of its employees at any time.
(d) No later than the date as of which an amount first becomes includible
in the gross income of the participant for Federal income tax purposes with
respect to any award under the Plan, the participant shall pay to the
Corporation, or make arrangements satisfactory to the Committee regarding the
payment of, any Federal, state, or local taxes of any kind required by law to be
withheld with respect to such amount. The Committee may require withholding
obligations to be settled with Common Stock, including Common Stock that is part
of the award that gives rise to the withholding requirement. The obligations of
the Corporation under the Plan shall be conditional on such payment or
arrangements and the Corporation and its Subsidiaries or Affiliates shall, to
the extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to the participant.
(e) The Plan and all awards made and actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Tennessee.
(f) The members of the Committee and the Board shall not be liable to any
employee or other person with respect to any determination made hereunder in a
manner that is not inconsistent with their legal obligations as members of the
Board. In addition to such other rights of indemnification as they may have as
directors or as members of the Committee, the members of the Committee shall be
indemnified by the Corporation against the reasonable expenses, including
attorneys' fees actually and necessarily incurred in connection with the defense
of any action, suit or proceeding, or in connection with any appeal therein, to
which they or any of them may be a party by reason of any action taken or
failure to act under or in connection with the Plan or any option granted
thereunder, and against all amounts paid by them in settlement thereof (provided
such settlement is approved by independent legal counsel selected by the
Corporation) or paid by them in satisfaction of a judgment in any such action,
suit or proceeding, except in relation to matters as to which it shall be
adjudged in such action, suit or proceeding that such Committee member is liable
for negligence or misconduct in the performance of his duties; provided that
within 60 days after institution of any such action, suit or proceeding, the
Committee member shall in writing offer the Corporation the opportunity, at its
own expense, to handle and defend the same.
(g) In addition to any other restrictions on transfer that may be
applicable under the terms of this Plan or the applicable award agreement, no
Stock Option issued under this Plan is transferable by the participant without
the prior written consent of the Committee, other than (i) transfers by an
Optionee to a member of his or her Immediate Family or a trust for the benefit
of the optionee or a member of his or her Immediate Family or (ii) transfers by
will or by the laws of descent and distribution. The designation of a
beneficiary will not constitute a transfer.
SECTION 10. Effective Date of Plan.
The Plan shall be effective as of the date of approval of the Plan by the
Board of Directors of the Corporation (the "Effective Date").
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SECTION 11. Term of Plan.
No Stock Option shall be granted pursuant to the Plan on or after the tenth
anniversary of the Effective Date of the Plan, but awards granted prior to such
tenth anniversary may be extended beyond that date.
Ex10-12 for 10-K ExBill Stock Op Plan
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