Exhibit 10.43
MCKESSON CORPORATION
1998 CANADIAN STOCK INCENTIVE PLAN
(As Amended Through October 26, 2001)
ARTICLE I - PURPOSE
1.1 The purpose of the McKesson Corporation 1998 Canadian Stock Incentive
Plan (the "Plan"), is to enable McKesson Corporation (the "Company") to
offer designated employees of Canadian subsidiaries of the Company
performance-based stock incentives thereby attracting, retaining and
rewarding such employees and strengthening the mutuality of interests
between the employees and the Company's shareholders.
ARTICLE II - DEFINITIONS
2.1 In this Plan, the following terms shall have the following meanings:
(a) "Article" and "Section" means an article or section of this Plan;
(b) "Award" means any grant approved in accordance with the terms of
the Plan;
(c) "Beneficiary" means a person or persons designated by the
Participant to succeed to, in the event of death, any outstanding
Award held by the Participant. Any Participant may, subject to
applicable laws and such limitations as may be prescribed by the
Committee, designate one or more persons primarily or
contingently as beneficiaries in writing by notice delivered to
the Company, and may revoke such designations in writing. If a
Participant fails effectively to designate a beneficiary, the
Participant's estate shall be the Participant's beneficiary;
(d) "Board of Directors" means the board of directors of the Company;
(e) "Committee" means the Compensation Committee of the Board of
Directors or such other committee, as the Board of Directors may
appoint from time to time for the purpose of administering this
Plan, or if at any time the Board does not have a Compensation
Committee or does not so appoint another committee for such
purpose, the Board of Directors;
(f) "Company" means McKesson Corporation and its successors and
assigns;
(g) "Disability" means (i) a physical or mental condition which, in
the judgment of the Committee based on competent medical evidence
satisfactory to the
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Committee, including, if required by the Committee, medical
evidence obtained by an examination conducted by a physician
selected by the Committee, renders an individual unable to engage
in any substantial gainful activity and which impairment is
likely to result in death or to be of long, continued and
indefinite duration, or (ii) a judicial declaration of
incompetence;
(h) "Fair Market Value" means, as of any date, the composite closing
price on such day of the Company's common shares as reported in
The Wall Street Journal;
(i) "Latest Exercise Date" means the latest date on which a
particular Option may be exercised;
(j) "Medis" means Medis Health and Pharmaceutical Services Inc.;
(k) "Notice of Grant" means a notice executed by the Company and the
Participant to whom an Award has been granted by which the
Committee shall notify a Participant of an Award granted to him
in accordance with the terms of the Plan, which notice shall be
duly executed by the Company and such Participant;
(l) "Option" means a right generated under the Plan to a Participant
to purchase Shares in accordance with the terms of the Plan;
(m) "Optionee" means a Participant to whom an Award of an Option has
been made;
(n) "Option Price" means in respect of an option, the price to be
paid per Share by a Participant on the exercise of an Option set
out in Section 5.2(b);
(o) "Participant" means an employee of Medis or a Canadian subsidiary
of the Company who has been designated by the Committee in its
sole discretion as being eligible to participate in the Plan;
(p) "Plan" means this McKesson Corporation 1998 Canadian Stock
Incentive Plan and any schedules attached hereto, as amended and
restated from time to time;
(q) "Retirement" means any retirement in accordance with the
applicable retirement policies of the relevant Canadian
subsidiary;
(r) "Shares" means common shares of the Company;
(s) "Stock Appreciation Right" means an Award described in Article
IV;
(t) "Termination of Employment" means the termination of a
Participant's employment with Medis, a Canadian subsidiary of the
Company or the Company, other than as a result of death,
Disability or Retirement;
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2.2 In this Plan, unless the context requires otherwise, references to the
male gender include the female gender and words importing the singular
number may be construed to extend to and include the plural number and
vice versa.
ARTICLE III - ADMINISTRATION
3.1 This Plan shall be administered and interpreted by the Committee. The
Committee will construe and interpret the terms and provisions of the
Plan and of any Award granted thereunder. The Committee may correct any
defect, complete any omission or reconcile any inconsistency in the
Plan, in any Notice of Grant or in any agreement relating to the Plan in
is sole discretion and in the manner or to the extent is shall deem
necessary.
3.2 The Committee shall have full authority to grant, pursuant to the terms
of the Plan, to Participants Options and Stock Appreciation Rights. In
particular, and without limitation, the Committee shall have the
authority to:
(i) select the Participants to whom Awards may be granted from
time to time hereunder;
(ii) determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Award granted hereunder,
including, but not limited to, any restriction or
limitation on transfer, any vesting schedule or
acceleration thereof, or any forfeiture provisions or
waiver thereof regarding any Award and the Shares relating
thereto, based on such factors as the Committee shall
determine, in its sole discretion; and
(iii) modify or waive any restrictions or limitations contained
in and grant extensions to or accelerate the vestings of,
any outstanding Awards, so long as such notifications,
waivers, extensions or accelerations are consistent with
the terms of the Plan; but no such changes shall impair
the rights of any Participant without his consent.
The Chief Executive Officer of the Company shall have concurrent
authority to grant Options to Participants, pursuant to the terms of the
Plan and consistent with the administration of the Plan by the
Committee, subject to the limitations of Section 5.1.
3.3 The Committee shall have full and complete authority to adopt, alter and
repeal any administrative rules, guidelines or practices governing the
Plan and perform all acts, including the delegation of its authority as
it shall from time to time deem advisable.
3.4 Any decision, interpretation or other action made or taken in good faith
by or at the direction of the Committee (or any of its members) or the
Company arising out of or in connection with the Plan shall be within
the absolute discretion of all and each of them, as the case may be, and
shall be final, binding and conclusive on the Company and all employees
and Participants and their respective Beneficiaries, heirs, executors,
administrators, successors and assigns.
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ARTICLE IV - SHARES AVAILABLE
4.1 The number of shares on which Options/Stock Appreciation Rights which
may be granted will be determined at the sole discretion of the Board of
Directors.
4.2 If the Company changes the number of issued Shares at any time for any
reason, including by stock dividend, stock split, recapitalization,
reorganization, exchange of shares, liquidation, combination or other
change in corporate structure affecting the Shares or makes a
distribution of cash or property which has a substantial impact on the
value of the issued Shares or there is a change in the valuation
formula, the Awards shall be appropriately adjusted by the Board of
Directors in their sole discretion. The Board of Directors shall also
make adjustments so that the net value of each such Award shall not be
changed.
4.3 Except as otherwise specifically provided herein, the Committee or the
Chief Executive Officer, as applicable, shall determine the time to make
an Award. Each Award shall be effective on a date determined by the
Committee; provided, however, with respect to an Option awarded by the
Chief Executive Officer, the effective date of such Award shall be the
later of (i) the date when [the Chief Executive Officer executes a
document setting forth the Option Award and delivers such document to
the Corporate Secretary for filing with the minutes of the Committee] or
(ii) the date specified in the Award.
ARTICLE V - OPTIONS
5.1 The Committee (or the Chief Executive Officer), in its (or his)
discretion, may grant to a Participant an Option; provided, however,
that the Chief Executive Officer may not: (i) grant options under the
Plan and the McKesson Corporation 1999 Stock Option and Restricted Stock
Plan covering more than 1,000,000 shares in the aggregate; (ii) grant an
option covering more than 100,000 shares to an individual officer or
employee; or (iii) designate himself or any executive officer of the
Corporation, as defined in the Rules of the New York Stock Exchange, as
a recipient of any option granted. Options granted by the Chief
Executive Officer shall be subject to the same terms as options granted
by the Committee.
5.2 Options granted under this Plan shall be subject to the following terms
and conditions and shall be in such form and contain such additional
terms, not inconsistent with the terms of this Plan, as the Committee
may deem desirable:
(a) At the time of the Award of an Option, the Committee (or the
Chief Executive Officer) shall specify the maximum number of
Shares which the Optionee may purchase. In exercising its (or
his) discretion, the Committee (or the Chief Executive Officer)
shall consider the Participant's performance and contribution to
the success of the Company and any special circumstances
including, but not limited to, the sustained superior performance
of the Participant, the need to retain the Participant and the
need to attract new employees.
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(b) The Option Price per Share shall be determined by the Committee
or the Chief Executive Officer, as applicable.
(c) All Options are immediately exercisable upon Disability or death,
and the Optionee or the Optionee's estate must exercise options
within three years of the date of such death or Disability. After
such period, all unexercised Options shall be automatically
cancelled and any rights to such Options shall be forfeited.
(d) Options may be exercised in accordance with the terms of the
Award in whole or in part at any time before the Latest Exercise
Date, and subject to subsections (c), (g) and (h), provided that:
(i) the Optionee notifies the Company in writing of his intent
to exercise the Option in whole or in part in such form as
prescribed by the Company and forwards such notice to the
Office of the Corporate Secretary of the Company;
(ii) the Participant's written notice is accompanied by payment
in full in the amount of the aggregate Option Price for
such number of Shares in such form as the Company may
accept.
(e) No fractional Shares shall be issued upon the exercise of an
Option. Accordingly, if for any reason, an Optionee would
otherwise have become entitled to a fractional Share upon the
exercise of an Option, he shall have the right to purchase only
the next lower whole number of Shares and no payment or other
adjustment will be made with respect to the fractional interests
so disregarded.
(f) The interest of any Optionee shall not be transferable or
alienable by him either by pledge, assignment or in any other
manner whatsoever and, during his lifetime shall be vested only
in him, but shall thereafter enure to the benefit of and be
binding upon the Beneficiary or legal personal representatives of
the Optionee.
(g) On the Optionee's Termination of Employment for any reason, other
than by reason of the Retirement, Disability or death of the
Optionee, the Optionee may exercise any Option for which rights
to exercise have accrued to the Optionee at the time of
Termination of Employment, within 3 months following the date of
Termination of Employment. After such period, all unexercised
Options shall be automatically cancelled and any rights to any
Options shall be forfeited.
(h) Where the employment of an Optionee is terminated by reason of
Retirement, the Optionee may exercise any Option for which rights
to exercise have accrued to the Optionee at the time of
Retirement within three years following the date of Retirement.
After such period, all unexercised Options shall be automatically
cancelled and any rights to any Options shall be forfeited.
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(i) The Committee may at any time offer to buy out an option
previously granted, based on such terms and conditions as the
Committee shall establish and communicate to the Participant at
the time that such offer is made.
(j) The Committee may at any time in its sole discretion accelerate
the right to exercise any Options.
(k) In the event of a Change of Control as defined in this section,
the right to exercise Options will be accelerated such that all
Options are immediately exercisable.
A "Change of Control" of me Company shall be deemed to have
occurred if any of the events set forth in any one of the
following paragraphs shall occur:
(i) any "person" (as such term is used in sections 13 (d) and
14(d) of the Securities Exchange Act of 1934, as amended
(U.S.), excluding the Company or any of As affiliates, a
trustee or any fiduciary holding securities under an
employee benefit plan of the Company or any of its
affiliates, an underwriter temporarily holding securities
pursuant to an offering of such securities or a
corporation owned, directly or indirectly, by stockholders
of the Company in substantially the same proportions as
their ownership of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (U.S.),
directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of
the Company's then outstanding securities; or
(ii) during any period of not more than two consecutive years,
individuals who at the beginning of such period constitute
the Board and any new director (other than a director
designated by a Person who has entered into an agreement
with the Company to effect a transaction described in
clause (i), (iii) or (iv) or this paragraph) whose
election by the Board or nomination for election by the
Company's stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or
whose election or nomination for election was previously
so approved, cease for any reason to constitute a majority
thereof; or
(iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation,
other than (A) a merger or consolidation which would
result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting
securities of the surviving entity), in combination with
the ownership of any trustee or other fiduciary holding
securities under an employee benefit plan of the Company,
at least 50% of the combined voting power of the voting
securities of the Company or such surviving entity
outstanding
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immediately after such merger or consolidation, or (B) a
merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction)
in which no person acquires more than 50% of the combined
voting power of the Company's then outstanding securities;
or
(iv) the shareholders of the Company approve a plan of complete
liquidation of the Company or any agreement for the sale
or disposition by the Company of all or substantially all
of the Company's assets.
Notwithstanding the foregoing, no Change in Control shall be
deemed to have occurred if there is consummated any transaction
or series of integrated transactions immediately following which
the holders of the Stock immediately prior to such transaction or
series of transactions continue to have the same proportionate
ownership in an entity which owns all or substantially all of the
assets of the Company immediately prior to such transaction or
series of transactions.
A Change of Control shall also be deemed to occur in the event
that 50.1% of more of the shares of Medis become owned by an
entity other than the Company.
5.3 The Committee or the Chief Executive Officer, as applicable, shall
notify each Optionee of the terms and conditions of the Award of an
Option by a Notice of Grant. The Notice of Grant shall indicate the
Option Price, the earliest and Latest Exercise Date and other terms
relating to the Award of the Option.
5.4 As soon as practicable, after the Company's receipt of the Participant's
written notice as specified in Section 5.2(d) and payment of the Option
Price, the Optionee shall be entitled to receive a certificate
representing the Shares purchased through the exercise of the Option.
5.5 An Optionee shall not have any rights as a shareholder in respect of
Shares subject to an Option until such Shares have been paid for in full
and issued.
5.6 The Committee may, in its discretion, provide at any time, and from time
to time, that particular Options granted hereunder will be accompanied
by a grant of Stock Appreciation Rights as set out in Article VI.
5.7 Any other provision of these terms and conditions to the contrary
notwithstanding, if the Committee determines that an Optionee has
engaged in any of the actions described in (c) below, the consequences
set forth in (a) and (b) below shall result:
(a) Any outstanding Option shall immediately and automatically
terminate, be forfeited and shall cease to be exercisable,
without limitation, by the Optionee or his or her
representatives, in the case of the death of the Optionee.
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(b) If the Optionee exercised an Option within six months prior to
the date upon which the Company discovered that the Optionee
engaged in any action described in (c) below, the Optionee, upon
written notice from the Company, shall immediately pay to the
Company the economic value realized or obtained by the exercise
of such Option measured at the date of exercise.
(c) The consequences described in (a) and (b) above shall apply if
the Optionee, either before or after termination of employment
with Medis, the Company or its affiliates:
(i) Discloses to others, or takes or uses for his own purpose
or the purpose of others, any trade secrets, confidential
information, knowledge, data or know-how or any other
proprietary information or intellectual property belonging
to Medis, the Company or its affiliates and obtained by
the Optionee during the term of his employment, whether or
not they are the Optionee's work product. Examples of such
confidential information or trade secrets include, without
limitation, customer lists, supplier lists, pricing and
cost data, computer programs, delivery routes, advertising
plans, wage and salary date, financial information,
research and development plans, processes, equipment,
product information and all other types and categories of
information as to which the Optionee knows or has reason
to know that Medis, the Company or its affiliates intends
or expects secrecy to be maintained;
(ii) Fails to promptly return all documents and other tangible
items belonging to Medis, the Company or its affiliates in
the Optionee's possession or control, including all
complete or partial copies, recordings, abstracts, notes
or reproductions of any kind made from or about such
documents or information contained therein, upon
termination of employment, whether pursuant to retirement
or otherwise;
(iii) Fails to provide Medis, the Company or its affiliates with
at least thirty (30) days' written notice prior to
directly or indirectly engaging in, becoming employed by,
or rendering services, advice or assistance to any
business in competition with Medis, the Company or its
affiliates. As used herein, "business in competition"
means any person organization or enterprise which is
engaged in or is about to become engaged in any line of
business engaged in by Medis, the Company or its
affiliates at the time of the termination of the
Optionee's employment with Medis, the Company or its
affiliates;
(iv) Fails to inform any new employer, before accepting
employment, of the terms of this paragraph and of the
Optionee's continuing obligation to maintain the
confidentiality of the trade secrets and other
confidential information belonging to Medis, the Company
or its affiliates and
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obtained by the Optionee during the term of his employment
with Medis, the Company or any Subsidiary;
(v) Induces or attempts to induce, directly or indirectly, any
of the customers of Medis, the Company or its affiliates,
employees, representatives or consultants to terminate,
discontinue or cease working with or for Medis, the
Company or its affiliates, or to breach any contract with
Medis, the Company or any of its affiliates, in order to
work with or for, or enter into a contract with, the
Optionee or any third party; or
(vi) Engages in conduct which is not in good faith and which
disrupts, damages, impairs or interferes with the
business, reputation or employees of Medis, the Company or
its affiliates.
The Committee shall determine in its sole discretion whether the
Optionee has engaged in any of the acts set forth in (i) through (vi)
above, and its determination shall be conclusive and binding on all
interested persons.
Any provision of this paragraph which is determined by a court of
competent jurisdiction to be invalid or unenforceable should be
construed or limited in a manner that is valid and enforceable and that
comes closest to the business objectives intended by such invalid or
unenforceable provision, without invalidating or rendering unenforceable
the remaining provisions of this paragraph.
ARTICLE VI - APPRECIATION RIGHTS
6.1 Stock Appreciation Rights may only be granted in conjunction with an
Option (referred to in this Article as a "Reference Option") granted
under the Plan.
6.2 Stock Appreciation Rights shall be subject to such terms and conditions,
not inconsistent with the provisions of this Plan, as shall be
determined from time to time by the Committee, including the following:
(a) A Stock Appreciation Right granted with respect to a Reference
Option shall terminate and no longer be exercisable upon the
termination or exercise of the Reference Option.
(b) A Stock Appreciation Right shall be exercisable only at such time
or times and to the extent that the Reference Option to which it
relates shall be exercisable.
(c) A Stock Appreciation Right may be exercised by an Optionee by
surrendering the applicable portion of the Reference Option. The
Participant will then have no further rights relating to the
Reference Option.
(d) Upon exercising a Stock Appreciation Right, a Participant shall
be entitled to receive an amount in cash, as determined by the
Committee, equal in value to the excess Fair Market Value of one
Share over the Option Price in Respect of the
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Reference Option multiplied by the number of Shares in respect of
which the Stock Appreciation Right shall have been exercised.
(e) Stock Appreciation Rights shall not be transferable except to the
extent indicated in Subsection 5.2(i) and shall terminate in
accordance with Subsections 5.2(c), (g) or (h).
6.3 The Committee shall notify a Participant of an Award of a Stock
Appreciation Right by a Notice of Grant. The Notice of Grant shall
indicate the term of the Award, the Reference Option and Option Price or
the Fair Market Value on the date of the Award, as applicable.
ARTICLE VII - TERMINATION OR AMENDMENT
7.1 Notwithstanding any other provision of the Plan, the Company, acting
through its Board of Directors, may, at any time and from time to time,
amend in whole or in part, any or all of the provisions of the Plan, or
suspend or terminate it entirely; provided, however, that, unless
otherwise required by law, the rights of a Participant with respect of
any Awards granted prior to such amendment, suspension or termination,
may not be impaired without the consent of such Participant.
ARTICLE VIII - GENERAL
8.1 This Plan is intended to be unfunded. With respect to any payments to
which a Participant has a fixed and vested interest, but which have not
yet been made to the Participant by the Company, nothing in the Plan
shall give any such Participant any rights that are greater than those
of a general creditor of the Company.
8.2 Participation in the Plan is not a guarantee of employment or of
continued participation in the Plan in any subsequent year.
8.3 In no event shall the value of, or income arising from, any Awards under
this Plan be treated as compensation for the purposes of any pension,
profit sharing, life insurance, disability or any other retirement or
welfare benefit plan now maintained or hereafter adopted by Medis, the
Company or any of its affiliates unless such plan specifically provides
to the contrary. Nothing herein contained shall affect Optionee's right
to participate in and receive benefits from and in accordance with the
then current provisions of any pensions, insurance, or other employment
welfare plan or program offered by Medis, the Company or any of its
affiliates.
8.4 The Company shall have the right to deduct from any payment to be made
pursuant to the Plan, or to otherwise require, prior to the issuance or
delivery of any Shares or the payment of any cash hereunder, payment by
the Participant of any taxes required bylaw to be withheld. The
Committee may permit any such withholding obligation to be satisfied by
reducing the number of Shares otherwise deliverable or by accepting the
delivery of previously owned Shares on account thereof.
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8.5 Except as specifically permitted hereunder, the interest of any
Participant or Optionee under the Plan in any Award shall not be
transferable or alienable by him and, during his lifetime, shall be
vested only in him, but shall thereafter enure to the benefit or and be
binding upon the Beneficiary or legal personal representatives of the
Participant.
8.6 No member of the Board of Directors, no member of the Committee, no
employee (including the Chief Executive Officer) nor the Company shall
be liable for any act or failure to act hereunder, by another member or
employee or by an agent to whom duties in connection with the
administration of the Plan have been delegated except in circumstances
involving bad faith, gross negligence or fraud.
8.7 The Company's obligation to issue Shares in accordance with the terms of
the Plan and any Award hereunder is subject to compliance with the laws,
rules and regulations of all public agencies and authorities applicable
to the issuance and distribution of such Shares and to the listing of
such Shares on any stock exchange on which any of the Shares of the
Company may be listed. As a condition of participation in the Plan, all
Participants must first agree to comply with all such laws, rules and
regulations and to furnish to the Company all information and
undertakings as may be required to permit compliance with such laws,
rules and regulations.
8.8 The Plan and any Awards hereunder shall be governed by and construed in
accordance with the laws of the Province of Ontario and the laws of
Canada applicable therein.
8.9 The effective date of this Plan is the 28th day of January, 1998.