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Exhibit 10.10
AVX CORPORATION
1995 STOCK OPTION PLAN
AS AMENDED JULY 15, 1999
1. Adoption and Purpose. The Company hereby adopts this Plan providing
for the granting of stock options to selected employees of the Company and its
Subsidiaries. The general purpose of the Plan is to promote the interests of the
Company and its Subsidiaries by providing to their employees incentives to
continue and increase their efforts with respect to, and remain in the employ
of, the Company and its Subsidiaries.
Options granted under the Plan may be "incentive stock options" within
the meaning of Section 422 of the Code or "nonqualified stock options", and the
specific type of option granted shall be designated in an applicable stock
option agreement.
2. Administration. The Plan will be administered by the Equity
Compensation Committee (the "Committee"), which shall be comprised of two or
more persons, each of whom shall qualify as (a) an "outside director" within the
meaning of Section 162(m) of the Code and (b) a "Non-Employee Director" within
the meaning of Rule 16b-3(b)(3)(i) promulgated under the Exchange Act.
Subject to the express provisions of the Plan, the Committee shall have
plenary authority, in its discretion, to administer the Plan and to exercise all
powers and authority either specifically granted to it under the Plan or
necessary and advisable in the administration of the Plan, including without
limitation the authority to interpret the Plan; to prescribe, amend and rescind
rules and regulations relating to the Plan; to determine the terms of all
options granted under the Plan (which need not be identical), the purchase price
of the shares covered by each option, the individuals to whom and the time or
times at which options shall be granted, whether an option shall be an incentive
stock option or a nonqualified stock option, when an option can be exercised and
whether in whole or in installments, and the number of shares covered by each
option; and to make all other necessary or advisable determinations with respect
to the Plan. The determination of the Committee on such matters shall be
conclusive.
3. Participants. The Committee shall from time to time select the
officers and key employees of the Company and its Subsidiaries to whom options
are to be granted, and who will, upon such grant, become participants in the
Plan.
4. Shares Subject to Plan. The Committee may not grant options under
the Plan for more than 3,150,000 shares of Common Stock, subject to any
adjustment as provided in Section 13 hereof. Shares to be optioned and sold may
be made available from either authorized but unissued Common Stock or Common
Stock held by the Company in its treasury. Shares that by reason of the
expiration of an option or otherwise are no longer subject to purchase pursuant
to an option granted under the Plan may be reoffered under the Plan.
5. Limitation on Number of Options. The Committee may not grant
incentive stock options under the Plan to any employee unless either (i) the
aggregate Fair Market
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Value (determined as of the time an incentive stock option is granted) of the
stock with respect to which incentive stock options granted to an employee under
the Plan (including all options qualifying as incentive stock options pursuant
to Section 422 of the Code granted to such employee under any other plan of the
Company or its Parent or Subsidiaries) are exercisable for the first time by
such employee during any calendar year does not exceed $100,000 or (ii) such
option is issued in exchange for a previously granted incentive stock option in
a substitution which is not treated as a modification of such option pursuant to
Section 424 of the Code.
No person may be granted options under the Plan in any five-year period
representing an aggregate of more than 500,000 shares of Common Stock. The
limitation established by the preceding sentence shall be subject to adjustment
as provided in Section 13 hereof.
6. Grant of Options. All options under the Plan shall be granted by the
Committee. The Committee shall determine the number of shares of Common Stock to
be offered from time to time by grant of options to employees who are
participants of the Plan (it being understood that more than one option may be
granted to the same employee). The grant of an option to an employee shall not
be deemed either to entitle the employee to, or to disqualify the employee from,
participation in any other grant of options under the Plan.
The grant of options shall be evidenced by stock option agreements
containing such terms and provisions as are approved by the Committee, but not
inconsistent with the Plan, including provisions that may be necessary to
ensure, in the case of an incentive stock option, that the option qualifies as
an incentive stock option under the Code. The Company shall execute stock option
agreements upon instructions from the Committee.
7. Option Price. Subject to the provisions set forth in this Section 7
relating to incentive stock options, the purchase price per share of the Common
Stock under each option shall be determined by the Committee, but shall not be
less than (i) 100% of the Fair Market Value per share of the Common Stock on the
date the option is granted, or (ii) with respect to an option issued in exchange
for a previously granted option in a substitution which is not treated as a
modification of such option (or would be so treated if such option was an
incentive stock option) pursuant to Section 424 of the Code, the appropriately
adjusted exercise price determined in accordance with Section 424 and the
regulations issued thereunder. No incentive stock option shall be granted to an
employee who, at the time such option is granted, is a Ten Percent Shareholder
unless at the time such incentive stock option is granted the option price per
share is at least 110% of the Fair Market Value per share of the Common Stock
subject to the incentive stock option.
8. Option Period. The option period will begin on the date the option
is granted, which will be the date the Committee authorizes the option unless
the Committee specifies a later date. No option may terminate later than the day
prior to the tenth anniversary of the date the option is granted; provided,
however, that an incentive stock option granted to an employee who, at the time
of such grant, is a Ten Percent Shareholder shall not be exercisable after the
expiration of five years after the date of grant. The Committee may provide for
the exercise of options in installments and upon such terms, conditions and
restrictions as it may determine. The Committee may provide in a stock option
agreement for termination of an option in the case of termination of employment
or any other reason.
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9. Exercisability of Options. The Committee may in its discretion
prescribe in the stock option agreement the installments, if any, in which an
option granted under the Plan shall become exercisable; provided, however, that
no option shall be exercisable (x) until the six-month anniversary of the date
of its grant and (y) unless the holder thereof is then an employee of the
Company or a Subsidiary, except in each case as otherwise provided in this Plan
(including Section 12) or as the Committee otherwise determines.
Except as provided in the applicable option agreement, if the
participant voluntarily terminates his employment or his employment with the
Company or Subsidiary is terminated for cause (as defined below), neither the
Company, the Parent nor any Subsidiary shall have any further obligation to the
participant hereunder, and the options (whether or not vested) shall immediately
terminate in full. In the event a participant's employment is terminated by the
Company for any reason other than for cause (defined as the commission of an act
of dishonesty, gross incompetency or intentional or willful misconduct, which
act occurs in the course of participant's performance of his duties as an
employee), options may be exercised, to the extent of the shares with respect to
which the option could have been exercised by the participant as of his date of
termination of employment, by the participant in accordance with its terms but
in no event beyond the earlier of (x) 90 days after the date of termination or
(y) the scheduled expiration of such option.
10. Payment; Method of Exercise. Payment shall be made in cash or,
unless otherwise prohibited in the applicable stock option agreement, in shares
of Common Stock already owned by the holder of the option or partly in cash and
partly in such shares. No shares may be issued until full payment of the
purchase price therefor has been made, and a participant will have none of the
rights of a stockholder until shares are issued to him.
An option may be exercised by written notice to the Company. Such
notice shall state that the holder of the option elects to exercise the option,
the number of shares in respect of which it is being exercised and the manner of
payment for such shares and shall either (i) be accompanied by payment of the
full purchase price of such shares or (ii) fix a date (not more than 10 business
days from the date of exercise) for the payment of the full purchase price of
such shares. Cash payments shall be made by cash or check payable to the order
of the Company. Common Stock payments (valued at Fair Market Value on the date
of exercise) shall be made by delivery of stock certificates in negotiable form.
If certificates representing Common Stock are used to pay all or part of the
purchase price of an option, a separate certificate shall be delivered by the
Company representing the same number of shares as each certificate so used, and
an additional certificate shall be delivered representing the additional shares
to which the holder of the option is entitled as a result of the exercise of the
option.
11. Withholding Taxes. If the Committee shall so require, as a
condition of exercise, each participant shall agree that (a) no later than the
date of exercise of any option, the participant will pay to the Company or make
arrangements satisfactory to the Committee regarding payment of any Federal,
state or local taxes of any kind required by law to be withheld upon the
exercise of such option (any such tax, a "Withholding Tax"); and (b) the Company
shall, to the extent permitted or required by law, have the right to deduct from
any payment of any kind otherwise due to the participant, any such Withholding
Tax.
12. Rights in the Event of Death, Retirement or Incapacity. If a
participant's employment is terminated due to death, Retirement or Incapacity
prior to termination of his or her right to exercise an option in accordance
with the provisions of his or her stock option
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agreement without having fully exercised the option, then (a) the Committee in
its discretion may cause the option to become fully vested and (b) such option
may be exercised by the participant (or in the event of the participant's death,
by his estate or by the person who acquired the right to exercise the option by
bequest or inheritance), to the extent of the shares with respect to which the
option could have been exercised by the participant as of the date of his or her
death, Retirement or Incapacity but also taking into account any acceleration of
vesting pursuant to clause (a) above, provided that the option is exercised
prior to the earlier of (x) one year after the date of such death, Retirement or
Incapacity and (y) the date of its original expiration. In the event of the
death of a participant following his or her termination of employment during the
period in which his or her option remains exercisable, such option may be
exercised to, the extent the option could have been exercised by the decedent,
by the participant's estate or by the person who acquired the right to exercise
the option by bequest or inheritance at any time within one year after the date
of death but in no event beyond the original expiration date of the option.
13. Effect of Certain Changes. (a) If there is any change in the number
of outstanding shares of Common Stock by reason of any stock dividend, stock
split, recapitalization, combination, exchange of shares, merger, consolidation,
liquidation, split-up, spin-off or other similar change in capitalization, any
distribution to common shareholders, including a rights offering, other than
cash dividends, or any like change, then the number of shares of Common Stock
available for options, the number of such shares covered by outstanding options,
and the price per share of such options shall be proportionately adjusted by the
Committee to reflect such change or distribution; provided, however, that any
fractional shares resulting from such adjustment shall be eliminated.
(b) In the event of a change in the Common Stock of the Company as
presently constituted, the shares resulting from any such change shall be deemed
to be the Common Stock within the meaning of the Plan.
(c) In the event of a reorganization, recapitalization, merger,
consolidation, acquisition of property or stock, extraordinary dividend or
distribution (other than as covered by Section 13(a) hereof), separation or
liquidation of the Company, or any other event similarly affecting the Company,
the Board or the Committee shall have the right, but not the obligation,
notwithstanding anything to the contrary in this Plan, to provide that
outstanding options granted under this Plan shall (i) be canceled in respect of
a cash payment or the payment of securities or property, or any combination
thereof, with a per share value determined by the Board in good faith to be
equal to the value received by the stockholders of the Company in such event in
the respect of each share of Common Stock, with appropriate deductions of
exercise prices, or (ii) be adjusted to represent options to receive cash,
securities, property, or any combination thereof, with a per share value
determined by the Board in good faith to be equal to the value received by the
stockholders of the Company in such event in respect of each share of Common
Stock, at such exercise prices as the Board or the Committee in its discretion
may determine is appropriate.
(d) To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Committee,
whose determination in that respect shall be final, binding and conclusive;
provided that each incentive stock option granted pursuant to this Plan shall
not be adjusted in a manner that causes such option to fail to continue to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.
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14. Nonexclusive Plan. Neither the adoption of the Plan by the Board
nor the submission of the Plan to the stockholders of the Company for approval
shall be construed as creating any limitations on the power of the Board to
adopt such other incentive arrangements as it may deem desirable, including,
without limitation, the granting of stock options otherwise than under the Plan,
and such arrangements may be either generally applicable or applicable only in
specific cases.
15. Section 16 Persons. With respect to persons subject to Section 16
of the Exchange Act, transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 or its successors under the Exchange Act. To
the extent any provision of the Plan or action by the Committee fails to so
comply, it shall be deemed null and void, to the extent permitted by law and
deemed advisable by the Committee.
16. Assignability. Nonqualified options may be transferred by gift to
any member of the optionee's immediate family or to a trust for the benefit of
one or more of such immediate family members and nonqualified and incentive
stock options may be transferred by the laws of descent and distribution. During
an optionee's lifetime, options granted to an optionee may be exercised only by
such optionee or by his or her guardian or legal representative unless the
option has been transferred in accordance with the preceding sentence, in which
case, it shall be exercisable only by such transferee. For purposes of this
Section 16, immediate family shall mean the optionee's spouse, children and
grandchildren.
17. Amendment or Discontinuance. The Plan may be amended or
discontinued by the Board without the approval of the stockholders of the
Company, except that stockholder approval shall be required for any amendment
that would (a) increase (except as provided in Section 13 hereof) the maximum
number of shares of Common Stock for which options may be granted under the Plan
or (b) change the class of employees eligible to participate in the Plan. No
termination, modification or amendment of the Plan may, without the consent of
the participant to whom any option shall theretofore have been granted,
adversely affect the rights of such employee (or his or her transferee) under
such option.
18. Effect of Plan. Neither the adoption of the Plan nor any action of
the Board or Committee shall be deemed to give any officer or employee any right
to be granted an option to purchase Common Stock or any other rights except as
may be evidenced by a stock option agreement, or any amendment thereto, duly
authorized by the Board or Committee and executed on behalf of the Company, and
then only to the extent and on the terms and conditions expressly set forth
therein.
19. Term. Unless sooner terminated by action of the Board, this Plan
will terminate on August 1, 2005. The Committee may not grant options under the
Plan after that date, but options granted before that date will continue to be
effective in accordance with their terms.
20. Effectiveness; Approval of Stockholders. The Plan shall take effect
upon its adoption by the Board, but its effectiveness and the exercise of any
options shall be subject to the approval of the holders of a majority of the
voting shares of the Company, which approval must occur within twelve months
after the date on which the Plan is adopted by the Board.
21. Definitions. For the purpose of this Plan, unless the context
requires otherwise, the following terms shall have the meanings indicated:
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(a) "Board" means the board of directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" means the Common Stock which the Company is
currently authorized to issue or may in the future be authorized to issue (as
long as the Common Stock varies from that currently authorized, if at all, only
in amount of par value).
(d) "Company" means AVX Corporation, a Delaware corporation.
(e) "Exchange Act" means the Securities Exchange Act of 1934, as from
time to time amended.
(f) "Fair Market Value" means the average of the high and the low sales
prices of a share of Common Stock on the date of grant (or, if not a trading
day, on the last preceding trading day) as reported on the New York Stock
Exchange Composite Transactions Tape or, if not listed on the New York Stock
Exchange, the principal stock exchange or the NASDAQ National Market on which
the Common Stock is then listed or traded; provided, however, that if the Common
Stock is not so listed or traded then the Fair Market Value shall be determined
in good faith by the Board.
(g) "Incapacity" means any material physical, mental or other
disability rendering the participant incapable of substantially performing his
services hereunder that is not cured within 180 days of the first occurrence of
such incapacity. In the event of any dispute between the Company and the
participant as to whether the participant is incapacitated as defined herein,
the determination of whether the participant is so incapacitated shall be made
by an independent physician selected by the Company's Board of Directors and the
decision of such physician shall be binding upon the Company and the
participant.
(h) "Option Period" means the period during which an option may be
exercised.
(i) "Parent" means any corporation in an unbroken chain of corporations
ending with the Company if, at the time of granting of the option, each of the
corporations other than the Company 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.
(j) "Plan" means this AVX Corporation 1995 Stock Option Plan as amended
from time to time.
(k) "Retirement" means, with respect to any participant, the
participant's retirement as an employee of the Company on or after reaching age
55.
(l) "Subsidiary" means any corporation in an unbroken chain of
corporations beginning with the Company if, at the time of the granting of the
option, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in
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one of the other corporations in the chain. The "Subsidiaries" means more than
one of any such corporations.
(m) "Ten Percent Shareholder" means an individual who owns (or is
treated as owning under Section 424(d) of the Code) stock possessing more than
10% of the total combined voting power of all classes of stock of the Company
or any Subsidiary.