1
EXHIBIT 10.2
THE CRAWFORD & COMPANY UK SHARESAVE SCHEME
1. DEFINITIONS AND INTERPRETATION
1.1 In this Scheme, unless the context otherwise requires:-
"3-YEAR OPTION", "5-YEAR OPTION" and "7-YEAR OPTION" have the meanings
given in sub-rule 3.2 below;
"ASSOCIATED COMPANY" means an associated company within the meaning
given to that expression by section 187(2) of the Taxes Act 1988 for the
purposes of paragraph 23 of Schedule 9;
"THE BOARD" means the board of directors of the Company or a committee
appointed by them;
"BONUS DATE", in relation to an option, means:-
1.1.1 in the case of a 3-Year Option, the earliest date on which the
bonus is payable,
1.1.2 in the case of a 5-Year Option, the earliest date on which a
bonus is payable, and
1.1.3 in the case of a 7-Year Option, the earliest date on which the
maximum bonus is payable;
and for this purpose "payable" means payable under the Savings
Contract made in connection with the option;
"THE COMPANY" means Crawford & Company, a corporation incorporated
under the laws of the state of Georgia in the USA;
"THE EXERCISE DATE" shall be the date on which a validly completed
notice of exercise is received by the Company;
"THE GRANT DAY" shall be construed in accordance with sub-rule 2.1
below;
"THE INVITATION DATE" shall be the date on which an invitation is given
pursuant to sub-rule 3.6 below;
"PARTICIPANT" means a person who holds an option granted under this
Scheme;
35
2
"PARTICIPATING COMPANY" means the Company or any Subsidiary to which the
Board has resolved that this Scheme shall for the time being extend;
"SAVINGS BODY" means any building society, institution authorised under
the Banking Act 1987 or relevant European institution (within the
meaning of Schedule 15A to the Taxes Act 1988) with which a Savings
Contract can be made;
"SAVINGS CONTRACT" means an agreement to pay monthly contributions under
the terms of a certified contractual savings scheme, within the meaning
of section 326 of the Taxes Act 1988, which has been approved by the
Inland Revenue for the purposes of Schedule 9;
"SCHEDULE 9" means Schedule 9 to the Taxes Act 1988;
"SUBSIDIARY" means a body corporate which is a subsidiary of the Company
(within the meaning of section 736 of the Companies Act 1985) and of
which the Company has control (within the meaning of section 840 of the
Taxes Act 1988);
"THE TAXES ACT 1988" means the Income and Corporation Taxes Act 1988;
and expressions not otherwise defined in this Scheme have the same
meanings as they have in Schedule 9.
1.2 Any reference in this Scheme to any enactment includes a reference to
that enactment as from time to time modified, extended or re-enacted.
1.3 Expressions in italics are for guidance only and do not form part of
this Scheme.
2. ELIGIBILITY
2.1 Subject to sub-rule 2.5 below, an individual is eligible to be granted
an option on any day ("THE GRANT DAY") if (and only if):-
2.1.1 he is on the Grant Day an employee or director of a company
which is a Participating Company; and
2.1.2 he either satisfies the conditions specified in sub-rule 2.2
below or is nominated by the Board for this purpose.
2.2 The conditions referred to in sub-rule 2.1.2 above are that the
individual:-
2.2.1 shall at all times during the qualifying period have been an
employee (but not a director) or a full-time director of the
Company or a company which was for the time being a
Subsidiary; and
2.2.2 was at the relevant time chargeable to tax in respect of his
employment or office under Case I of Schedule E.
36
3
2.3 For the purposes of sub-rule 2.2 above:-
2.3.1 THE RELEVANT TIME is the date on which any invitation is given
under Rule 3.6 below or such other time during the period of 5
years ending with the Grant Day as the Board may determine
(provided that no such determination may be made if it would
have the effect that the qualifying period would not fall
within that 5-year period);
2.3.2 THE QUALIFYING PERIOD is such period ending at the relevant
time but falling within the 5-year period mentioned in
paragraph 2.3.1 above as the Board may determine;
2.3.3 an individual shall be treated as a FULL-TIME DIRECTOR of a
company if he is obliged to devote to the performance of the
duties of his office or employment with the company not less
than 25 hours a week;
2.3.4 Chapter I of Part XIV of the Employment Rights Act 1996 shall
have effect, with any necessary changes, for ascertaining the
length of the period during which an individual shall have
been an employee or a full-time director and whether he shall
have been an employee or a full-time director at all times
during that period.
2.4 Any determination of the Board under paragraph 2.3.1 or 2.3.2 above
shall have effect in relation to every individual for the purpose of
ascertaining whether he is eligible to be granted an option on the Grant
Day.
2.5 An individual is not eligible to be granted an option at any time if he
is at that time ineligible to participate in this Scheme by virtue of
paragraph 8 of Schedule 9 (material interest in close company).
3. GRANT OF OPTIONS
3.1 Subject to Rule 4 below, the Board may grant an option to acquire shares
in the Company which satisfy the requirements of paragraphs 10 to 14 of
Schedule 9 (fully paid up, unrestricted, ordinary share capital), upon
the terms set out in this Scheme, to any individual who:-
3.1.1 is eligible to be granted an option in accordance with Rule 2
above, and
3.1.2 has applied for an option and proposed to make a Savings
Contract in connection with it (with a Savings Body approved
by the Board) in the form and manner prescribed by the Board,
and for this purpose an option to acquire includes an option to
purchase and an option to subscribe.
37
4
3.2 The type of option to be granted to an individual, that is to say a
3-Year Option, a 5-Year Option or a 7-Year Option, shall be determined
by the Board or, if the Board so permits, by the individual; and for
this purpose:-
3.2.1 a 3-YEAR OPTION is an option in connection with which a three
year Savings Contract is to be made and in respect of which,
subject to sub-rule 4.3 below, the repayment is to be taken as
including the bonus;
3.2.2 a 5-YEAR OPTION is an option in connection with which a five
year Savings Contract is to be made and in respect of which,
subject to sub-rule 4.3 below, the repayment is to be taken as
including a bonus other than the maximum bonus; and
3.2.3 a 7-YEAR OPTION is an option in connection with which a five
year Savings Contract is to be made and in respect of which
the repayment is to be taken as including the maximum bonus.
3.3 The amount of the monthly contribution under the Savings Contract to be
made in connection with an option granted to an individual shall,
subject to sub-rule 4.5 below, be the amount which the individual shall
have specified in his application for the option that he is willing to
pay or, if lower, the maximum permitted amount, that is to say, the
maximum amount which:-
3.3.1 when aggregated with the amount of his monthly contributions
under any other Savings Contract linked to this Scheme or to
any other savings-related share option scheme approved under
Schedule 9, does not exceed (pound)250 or such other maximum
amount as may for the time being be permitted by paragraph
24(2)(a) of Schedule 9;
3.3.2 does not exceed the maximum amount for the time being
permitted under the terms of the Savings Contract; and
3.3.3 when aggregated with the amount of his monthly contributions
under any other Savings Contract linked to this Scheme, does
not exceed any maximum amount determined by the Board.
3.4 The number of shares in respect of which an option may be granted to any
individual shall be the maximum number which can be paid for, at the
price determined under sub-rule 3.5 below, with monies equal to the
amount of the repayment due on the Bonus Date under the Savings Contract
to be made in connection with the option and for these purposes, the
exchange rate to be used shall be the closing mid-point sterling/US
dollar exchange rate published in the Financial Times (or such other
newspaper as the Board may select from time to time) on the Exercise
Date (or if not published on that day, the last preceding day of
publication).
38
5
3.5 The price at which shares may be acquired by the exercise of options of
a particular type granted on any day shall be a price denominated in US
dollars which is determined by the Board and stated on that day,
provided that:-
3.5.1 if shares of the same class as those shares are quoted on the
New York Stock Exchange, the price shall not be less than 85%
of-
(a) the average of the closing prices of shares of that
class on the five dealing days last preceding the
Invitation Date, or
(b) if the first of those dealing days does not fall
within the period of 30 days ending with the day on
which the options are granted or falls prior to the
date on which the Company last announced its results
for any period, the closing price of shares of that
class on the dealing day last preceding the day on
which the options are granted or such other dealing
day as may be agreed with the Inland Revenue;
3.5.2 if paragraph (a) above does not apply, the price shall not be
less than the Specified Percentage of the market value (within
the meaning of Part VIII of the Taxation of Chargeable Gains
Act 1992) of shares of that class, as agreed in advance for
the purposes of this Scheme with the Shares Valuation Division
of the Inland Revenue, on -
(a) the Invitation Date, or
(b) if that date does not fall within the period of 30
days ending with the day on which the options are
granted, on the day on which the options are granted
or such other day as may be agreed with the Inland
Revenue; and
3.5.3 in the case of an option to acquire shares only by
subscription, the price shall not be less than the nominal
value of those shares;
3.6 The Board shall ensure that, in relation to the grant of options on any
day:-
3.6.1 every individual who is eligible to be granted an option on
that day has been given an invitation;
3.6.2 the invitation specifies a period of not less than 14 days in
which an application for an option may be
made; and
3.6.3 every eligible individual who has applied for an option as
mentioned in sub-rule 3.1 above is in fact granted an option
on that day.
3.7 An invitation to apply for an option may only be given within the
period of 10 years beginning with the date on which this Scheme is
adopted by the Company.
39
6
3.8 An option granted to any person:-
3.8.1 shall not, except as provided in sub-rule 5.3 below, be
capable of being transferred by him; and
3.8.2 shall lapse forthwith if he is adjudged bankrupt.
4. EXERCISE OF OPTIONS
4.1 The exercise of any option shall be effected in the form and manner
prescribed by the Board, provided that the monies paid for shares on
such exercise shall not exceed the amount of the repayment made and any
interest paid under the Savings Contract made in connection with the
option.
4.2 Subject to sub-rules 4.3, 4.4 and 4.6 below and to Rule 6 below, an
option shall not be capable of being exercised before the Bonus Date.
4.3 Subject to sub-rule 4.8 below:-
4.3.1 if any Participant dies before the Bonus Date, any option
granted to him may (and must, if at all) be exercised by his
personal representatives within 12 months after the date of
his death, and
4.3.2 if he dies on or within 6 months after the Bonus Date, any
option granted to him may (and must, if at all) be exercised
by his personal representatives within 12 months after the
Bonus Date,
provided in either case that his death occurs at a time when he either
holds the office or employment by virtue of which he is eligible to
participate in this Scheme or is entitled to exercise the option by
virtue of sub-rule 4.4 below.
4.4 Subject to sub-rule 4.8 below, if any Participant ceases to hold the
office or employment by virtue of which he is eligible to participate in
this Scheme (otherwise than by reason of his death), the following
provisions apply in relation to any option granted to him:-
4.4.1 if he so ceases by reason of injury, disability, redundancy
within the meaning of the Employment Rights Act 1996, or
retirement on reaching the age of 60 or any other age at which
he is bound to retire in accordance with the terms of his
contract of employment, the option may (and subject to
sub-rule 4.3 above must, if at all) be exercised within 6
months of his so ceasing;
4.4.2 if he so ceases by reason only that the office or employment
is in a company of which the Company ceases to have control,
or relates to a business or part of a business which is
transferred to a person who is neither an Associated Company
of the Company nor a company of which
40
7
the Company has control, the option may (and subject to
sub-rule 4.3 above must, if at all) be exercised within 6
months of his so ceasing;
4.4.3 if he so ceases for any other reason within 3 years of the
grant of the option, the option may not be exercised at all;
4.4.4 if he so ceases for any other reason (except for dismissal for
misconduct) more than 3 years after the grant of the option,
the option may (and subject to sub-rule 4.3 above must, if at
all) be exercised within 6 months of his so ceasing.
4.5 Subject to sub-rule 4.8 below, if, at the Bonus Date, a Participant
holds an office or employment with a company which is not a
Participating Company but which is an Associated Company or a company of
which the Company has control, any option granted to him may (and
subject to sub-rule 4.3 above must, if at all) be exercised within 6
months of the Bonus Date.
4.6 Subject to sub-rule 4.8 below, where any Participant continues to hold
the office or employment by virtue of which he is eligible to
participate in this Scheme after the date on which he reaches the age of
60, he may exercise any option within 6 months of that date.
4.7 Subject to sub-rule 4.3 above, an option shall not be capable of being
exercised later than 6 months after the Bonus Date.
4.8 Where, before an option has become capable of being exercised, the
Participant gives notice that he intends to stop paying monthly
contributions under the Savings Contract made in connection with the
option, or is deemed under its terms to have given such notice, or makes
an application for repayment of the monthly contributions paid under it,
the option may not be exercised at all.
4.9 A Participant shall not be treated for the purposes of sub-rules 4.3 and
4.4 above as ceasing to hold the office or employment by virtue of which
he is eligible to participate in this Scheme until he ceases to hold an
office or employment in the Company or any Associated Company or company
of which the Company has control, and a female Participant who ceases to
hold the office or employment by virtue of which she is eligible to
participate in this Scheme by reason of pregnancy or confinement and who
exercises her right to return to work under the Employment Rights Act
1996 before exercising her option shall be treated for the purposes of
sub-rule 4.4 above as not having ceased to hold that office or
employment.
4.10 A Participant shall not be eligible to exercise an option at any time:-
4.10.1 unless, subject to sub-rules 4.4 and 4.5 above, he is at that
time a director or employee of a Participating Company;
41
8
4.10.2 if he is not at that time eligible to participate in this
Scheme by virtue of paragraph 8 of Schedule 9 (material
interest in close company).
4.11 An option shall not be capable of being exercised more than once.
4.12 Within 30 days after an option has been exercised by any person, the
Board shall allot to him (or a nominee for him) or, as appropriate,
procure the transfer to him (or a nominee for him) of the number of
shares in respect of which the option has been exercised, provided
that:-
4.12.1 the Board considers that the issue or transfer thereof would
be lawful in all relevant jurisdictions; and
4.12.2 in a case where a Participating Company is obliged to (or
would suffer a disadvantage if it were not to) account for any
tax (in any jurisdiction) for which the person in question is
liable by virtue of the exercise of the option and/or for any
social security contributions recoverable from the person in
question (together, the "Tax Liability"), that person has
either:
(a) made a payment to the Participating Company of an
amount equal to the Tax Liability; or
(b) entered into arrangements acceptable to that or
another Participating Company to secure that such a
payment is made (whether by authorising the sale of
some or all of the shares on his behalf and the
payment to the Participating Company of the relevant
amount out of the proceeds of sale or otherwise).
4.13 All shares allotted under this Scheme shall rank equally in all respects
with shares of the same class then in issue except for any rights
attaching to such shares by reference to a record date before the date
of the allotment.
4.14 If shares of the same class as those allotted under this Scheme are
listed on any stock exchange, the Company shall apply to that stock
exchange for any shares so allotted to be admitted thereto.
5. TAKEOVER, RECONSTRUCTION AND WINDING UP
5.1 If any person obtains control of the Company (within the meaning of
section 840 of the Taxes Act 1988) as a result of making a general offer
to acquire shares in the Company, or having obtained control makes such
an offer, the Board shall within 7 days of becoming aware thereof notify
every Participant thereof and, subject to sub-rules 4.3, 4.4, 4.7 and
4.8 above, any option may be exercised within one month (or such longer
period as the Board may permit) of the notification, but not later than
6 months after that person has obtained control.
42
9
5.2 For the purposes of sub-rule 5.1 above, a person shall be deemed to have
obtained control of the Company if he and others acting in concert with
him have together obtained control of it.
5.3 If a compromise or arrangement is effected for the purposes of or in
connection with a scheme for the reconstruction of the Company or its
amalgamation with any other company or companies, or if the Company
passes a resolution for voluntary winding up, the Board shall forthwith
notify every Participant thereof and, subject to sub-rules 4.3, 4.4, 4.7
and 4.8 above, any option may be exercised within one month of the
notification, but to the extent that it is not exercised within that
period shall (notwithstanding any other provision of this Scheme) lapse
on the expiration of that period.
5.4 If any company ("the acquiring company"):-
5.4.1 obtains control of the Company as a result of making-
(a) a general offer to acquire the whole of the issued
ordinary share capital of the Company which is made
on a condition such that if it is satisfied the
acquiring company will have control of the Company,
or
(b) a general offer to acquire all the shares in the
Company which are of the same class as the shares
which may be acquired by the exercise of options
granted under this Scheme,
any Participant may at any time within the appropriate period (which
expression shall be construed in accordance with paragraph 15(2) of
Schedule 9), by agreement with the acquiring company, release any option
which has not lapsed ("the old option") in consideration of the grant to
him of an option ("the new option") which (for the purposes of that
paragraph) is equivalent to the old option but relates to shares in a
different company (whether the acquiring company itself or some other
company falling within paragraph 10(b) or (c) of Schedule 9).
5.5 The new option shall not be regarded for the purposes of sub-rule 5.4
above as equivalent to the old option unless the conditions set out in
paragraph 15(3) of Schedule 9 are satisfied, but so that the provisions
of this Scheme shall for this purpose be construed as if:-
5.5.1 the new option were an option granted under this Scheme at the
same time as the old option;
5.5.2 except for the purposes of the definitions of "Participating
Company" and "Subsidiary" in sub-rule 1.1 and sub-rules 4.4.2,
4.5 and 4.9 above, the expression "the Company" were defined
as "a company whose shares may be acquired by the exercise of
options granted under this Scheme";
43
10
5.5.3 the Savings Contract made in connection with the old option
had been made in connection with the new option; and
5.5.4 the Bonus Date in relation to the new option were the same as
that in relation to the old option.
6. VARIATION OF CAPITAL
6.1 Subject to sub-rule 6.3 below, in the event of any variation of the
share capital of the Company, the Board may make such adjustments as it
considers appropriate under sub-rule 6.2 below.
6.2 An adjustment made under this sub-rule shall be to one or more of the
following:-
6.2.1 the price at which shares may be acquired by the exercise of
any option;
6.2.2 where any option has been exercised but no shares have been
allotted or transferred pursuant to the exercise, the price at
which they may be acquired.
6.3 At a time when this Scheme is approved by the Inland Revenue under
Schedule 9, no adjustment under sub-rule 6.2 above shall be made without
the prior approval of the Inland Revenue.
6.4 An adjustment under sub-rule 6.2 above may have the effect of reducing
the price at which shares may be acquired by the exercise of an option
to less than their nominal value, but only if and to the extent that the
Board shall be authorised to capitalise from the reserves of the Company
a sum equal to the amount by which the nominal value of the shares in
respect of which the option is exercised exceeds the price at which the
shares may be subscribed for and to apply that sum in paying up that
amount on the shares; and so that on the exercise of any option in
respect of which such a reduction shall have been made the Board shall
capitalise that sum (if any) and apply it in paying up that amount.
7. ALTERATIONS
The Board may at any time alter this Scheme, provided that no alteration
shall be made at a time when this Scheme is approved by the Inland
Revenue under Schedule 9 without the prior approval of the Inland
Revenue.
8. MISCELLANEOUS
8.1 The rights and obligations of any individual under the terms of his
office or employment with the Company or a Subsidiary shall not be
affected by his participation in this Scheme or any right which he may
have to participate in it, and an individual who participates in it
shall waive all and any rights to compensation or damages in consequence
of the termination of his office or
44
11
employment for any reason whatsoever insofar as those rights arise or
may arise from his ceasing to have rights under or be entitled to
exercise any option as a result of such termination.
8.2 In the event of any dispute or disagreement as to the interpretation of
this Scheme, or as to any question or right arising from or related to
this Scheme, the decision of the Board shall be final and binding upon
all persons.
8.3 The Company and any Subsidiary may provide money to the trustees of any
trust or any other person to enable them or him to acquire shares to be
held for the purposes of the Scheme, or enter into any guarantee or
indemnity for those purposes, to the extent permitted by any applicable
laws.
8.4 Any notice or other communication under or in connection with this
Scheme may be given by personal delivery or by sending it by post, in
the case of a company to its registered office, and in the case of an
individual to his last known address, or, where he is a director or
employee of the Company or a Subsidiary, either to his last known
address or to the address of the place of business at which he performs
the whole or substantially the whole of the duties of his office or
employment.
CLIFFORD CHANCE
200 Aldersgate Street
London EC1A 4JJ
45