EXHIBIT 10 (a)
AMENDMENT NO. 7
TO THE
TRANSMATION, INC.
DIRECTORS' STOCK PLAN
EFFECTIVE JUNE 20, 2001
WHEREAS, Transmation, Inc., an Ohio corporation (the "Company") has
established the Transmation, Inc. Directors' Stock Plan, as heretofore amended
(the "Plan"); and
WHEREAS, deeming appropriate and advisable to do so, and pursuant to
Section 9 of the Plan, the Board of Directors of the Company has authorized,
approved and adopted the further amendments to the Plan set forth herein;
NOW, THEREFORE, the Plan is hereby amended and restated in its entirety,
effective June 20, 2001, as set forth below:
TRANSMATION, INC.
AMENDED AND RESTATED DIRECTORS' STOCK PLAN
INCLUDING ALL AMENDMENTS THROUGH JUNE 20, 2001
THIS TRANSMATION, INC. DIRECTORS' STOCK PLAN (the "Plan") is established to
foster and promote the long-term financial success of Transmation, Inc., an Ohio
corporation (the "Company"), by attracting and retaining outstanding
non-employee Directors by enabling them to participate in the Company's growth
through automatic, non-discretionary awards ("Awards") of shares of the Common
Stock, par value $.50 per share, of the Company ("Shares"). Awards under this
Plan shall be in lieu of an annual cash retainer paid to Directors and cash fees
paid to Directors for attendance at meetings.
1. ELIGIBILITY. Eligibility in this Plan shall be limited to each member of
the Board of Directors of the Company (the "Board"), now or hereafter elected a
Director, who (a) is not an employee of the Company or any of its subsidiaries,
and (b) has elected, as herein provided, to receive Awards in lieu of cash
payments (each, a "Participating Director"). On or before March 31 of each year
(or such other date as the officers of the Company may, for reasons of
convenience of administration of this Plan, determine), each Director shall
notify the Company, by completing and executing the form annexed to this Plan as
Annex A, whether he elects to be a Participating Director for the ensuing fiscal
year of the Company.
2. SHARES SUBJECT TO THE PLAN. Shares which may be awarded under this Plan
may be, in whole or in part, authorized and unissued Shares or previously issued
Shares reacquired by the Company, including Shares purchased on the open market,
or such other securities as may be substituted pursuant to Section 10. The
maximum number of Shares which may be issued for all purposes under this Plan
shall be 200,000 (subject to adjustment pursuant to Section 10).
3. STOCK AWARDS.
(a) ANNUAL AWARDS. Each Participating Director shall receive an Award
of 2,666 Shares for each full year during which he serves as a Director;
provided, however, that if, on the date of any such Award, 2,666 Shares has an
aggregate market value in excess of $10,000, then such Award shall instead be in
the amount of the largest number of whole Shares that has an aggregate market
value not exceeding $10,000. For purposes hereof, a full year of service as a
Director shall mean service as a Director from the date of one annual meeting of
shareholders to the next annual meeting of shareholders. If a Director serves
less than a full-year term for any reason other than removal for cause, such
Director shall receive a pro rata Award of Shares for such year, based on the
number of whole months since the last annual meeting of shareholders during
which he served as a Director. If a pro rata Award would result in the issuance
of a fractional share, the fractional share shall be rounded up to 1 if the
fraction is .5 or greater and rounded down to zero if the fraction is less than
.5. Annual Awards shall be made on the annual meeting date and the share
certificates representing such Awards shall be issued as soon as practicable
after the next following September 30.
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(b) AWARDS FOR BOARD MEETINGS ATTENDED. Each Participating Director
shall receive an Award of 400 Shares for each regular or special meeting of the
Board attended by such Participating Director; provided, however, that if, on
the date of any such Award, 400 Shares has an aggregate market value in excess
of $1,500, then such Award shall instead be in the amount of the largest number
of whole Shares that has an aggregate market value not exceeding $1,500. Such
Awards shall be made on the date of each such Board meeting, with share
certificates representing such Awards to be issued as soon as practicable after
the last day of each fiscal quarter of the Company.
(c) AWARDS FOR COMMITTEE MEETINGS ATTENDED. Each Participating
Director shall receive an Award of 200 Shares for each meeting of a Committee of
the Board attended by such Participating Director; provided, however, that if,
on the date of any such Award, 200 Shares has an aggregate market value in
excess of $750, then such Award shall instead be in the amount of the largest
number of whole Shares that has an aggregate market value not exceeding $750.
Such Awards shall be made on the date of each such Committee meeting, with share
certificates representing such Awards to be issued as soon as practicable after
the last day of each fiscal quarter of the Company.
(d) ATTENDANCE AT MEETINGS BY CONFERENCE TELEPHONE. Notwithstanding
any other provision of this Plan to the contrary: (i) a Participating Director
who attends by conference telephone equipment any regular meeting of the Board
shall receive no Award for attendance at such meeting; (ii) a Participating
Director who attends by conference telephone equipment any special meeting of
the Board shall receive an Award for attendance at such meeting, as if he had
been present in person, if and to the extent that such Award is otherwise
payable pursuant to Section 3(b); (iii) a Participating Director who attends by
conference telephone equipment any meeting of a Committee of the Board held on
14 days' or more notice shall receive no Award for attendance at such meeting;
and (iv) a Participating Director who attends by conference telephone equipment
any meeting of a Committee of the Board held on less than 14 days' notice shall
receive an Award for attendance at such meeting, as if he had been present in
person, if and to the extent that such Award is otherwise payable pursuant to
Section 3(b).
4. DEFERRAL OF AWARDS.
(a) DEFERRAL. A Participating Director may elect to defer receipt of
all or a portion of the Award that would otherwise be paid to him in Shares. All
such deferrals must be in Shares as set forth in this Section 4.
(b) TIME FOR ELECTING DEFERRAL. The election to defer the receipt of
an Award must be made prior to the time that such Award is earned by the
Participating Director. The election shall be made in accordance with the
procedures set forth in Section 4(c).
(c) MANNER OF ELECTING DEFERRAL. An election to defer the receipt of
an Award for a given fiscal year of the Company by a Participating Director
shall be made on the annual notice given by such Director to the Company
pursuant to Section 1 prior to the fiscal year to which the
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election relates. The election shall include: (1) a statement that the
Participating Director would like to defer the receipt of all or a portion of
the Award he would otherwise be entitled to receive pursuant to this Plan for
the forthcoming fiscal year of the Company; (2) the number of Shares of the
Award to be deferred; (3) if it is the Participating Director's first election
to defer an Award, the year to which receipt of his Participant Stock Account
should be deferred (which year must be at least two calendar years after the
calendar year in which the election is made); and (4) whether the Director
elects to receive the payment of his Participant Stock Account in a lump sum or
in equal annual installments (and if in installments, the number of annual
installments, not to exceed 10).
(d) PARTICIPANT STOCK ACCOUNTS FOR DEFERRALS.
(i) A Participant Stock Account shall be established for each
Participating Director who elects to defer the receipt of all or any
portion of an Award. The Participant Stock Account of a Participating
Director shall be credited with the number of Shares of the Award that
the Participating Director has elected to defer.
(ii) If at any time dividends are paid by the Company on the
Shares, then each Participant Stock Account shall, on each dividend
payment date, be credited with the number of Shares that the dividends
payable on the Shares then credited to such account would purchase
based upon the Fair Market Value of Shares on that day. If the payment
of such dividend would result in the issuance of a fractional share,
the fractional share shall be rounded up to 1 if the fraction if .5 or
greater and rounded down to zero if the fraction is less than .5.
(iii) The number of Shares credited to a Participant Stock
Account shall be appropriately adjusted to reflect any stock split,
stock dividend, stock exchange or similar change in capitalization. If
such adjustment would result in the issuance of a fractional share,
the fractional share shall be rounded up to 1 if the fraction if .5 or
greater and rounded down to zero if the fraction is less than .5.
(iv) In the event of a Change of Control, a Participant Stock
Account shall be credited with cash or consideration in an amount
equal to the value of the cash and other consideration received by the
shareholders. For purposes of this Plan, a "Change of Control" shall
mean: (a) the first purchase of shares pursuant to a tender or
exchange offer which is intended to effect the acquisition of more
than 50 percent of the voting power of the Company (other than a
tender or exchange offer made by the Company); or (b) approval by the
Company's shareholders of: (i) a merger or consolidation of the
Company with or into another corporation (other than a merger or
consolidation in which the Company is the surviving corporation and
which does not result in any reclassification or reorganization of the
shares), (ii) a sale or disposition of all or substantially all of the
Company's assets, or (iii) a plan of complete liquidation or
dissolution of the Company.
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(e) PAYMENT OF DEFERRED AMOUNTS.
(i) No distribution or withdrawal may be made from a Participant
Stock Account except as provided by this Section 4(e).
(ii) The initial deferral term of a Participant Stock Account
shall be until the October 15th of the year identified by the
Participating Director in his first election to defer receipt of an
Award; provided, however, a Participating Director may continuously
elect to extend such deferral period by giving the Company notice of
his election to extend the existing deferral period and the new year
to which it is to be deferred, if such notice is given at least six
months prior to the date that the first distribution with respect to
his Participant Stock Account is scheduled to be made.
(iii) At the expiration of the deferral term (including any valid
extensions thereof), payment of a Participant Stock Account shall be
made either in a lump sum or over annual installments, in accordance
with the Participating Director's prior election.
(iv) If a lump sum payment is elected, the Company shall transfer
to the Participating Director the number of Shares credited to his
Participant Stock Account on the date of the expiration of the
deferral term (including any valid extensions thereof).
(v) If installment payments are elected, then the first annual
installment shall equal the number of Shares credited to the
Participation Stock Account multiplied by a fraction, the numerator of
which is one and the denominator of which is the total number of
annual installments to be made. All subsequent installments shall be
for the same number of Shares as the first installment, subject to
adjustment to reflect any credits made pursuant to Sections 4(d)(ii),
(iii) and (iv); provided, however, the final installment shall be for
the remaining balance of the number Shares in the Participant Stock
Account. If any payment under this subsection (v) would result in the
issuance of a fractional share, the fractional share shall be rounded
up to 1 if the fraction if .5 or greater and rounded down to zero if
the fraction is less than .5.
(vi) In the event of the death of a Participating Director before
he has received all of the deferred payments to which he is entitled
hereunder, the remaining installments that would have been paid to
such Participating Director shall be paid to his estate.
(vii) Notwithstanding a Participating Director's election of
installment payments, the Company, in its sole discretion, shall have
the right to accelerate any installment payments or to make payment of
the balance of a Participant Stock Account in a lump sum.
(viii) If there has been a Change of Control, the Company shall
thereafter make payments with respect to a Participant Stock Account
in cash or other consideration.
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(f) RIGHTS UNSECURED. The maintenance of individual Participant Stock
Accounts is for bookkeeping purposes only. The Company is not obligated to
acquire or set aside any particular assets for the discharge of its obligations,
nor is any Participating Director to have any property rights in any particular
assets held by the Company, whether or not held for the purpose of funding the
Company's obligations. The right of any Participating Director or his estate to
receive future installments under the provisions of this Plan shall be an
unsecured claim against the general assets of the Company.
(g) STATEMENT OF ACCOUNT. Statements will be sent to Participating
Directors who have deferred Awards under this Section not less frequently than
annually listing the number of Shares credited to his Participant Stock Account,
when the deferral period for his Participant Stock Account is set to expire, and
whether payment of his Participant Stock Account at the end of the deferral
period is to be made by lump sum or installments.
(h) FAIR MARKET VALUE. For purposes of the Plan, the fair market value
per share of the Common Stock on any date ("Fair Market Value") shall be the
closing price of the Common Stock on the principal national securities exchange
on which the Common Stock is then listed or admitted to trading, and the closing
price shall be the last reported sale price regular way or, if no sale takes
place on such date, the average of the closing bid and closing asked prices
regular way, as reported by such exchange. If the Common Stock is not then so
listed or admitted to trading on a national securities exchange, then Fair
Market Value shall be the closing price of the Common Stock in the
over-the-counter market as reported by the National Association of Securities
Dealers Automated Quotation System ("NASDAQ"), and the closing price shall be
the last reported sale price regular way or, if no sale takes place on such
date, the average of the closing bid and closing asked prices regular way, as
reported by NASDAQ. If the Common Stock closing price is not then reported by
NASDAQ, then Fair Market Value shall be the mean between the representative
closing bid and closing asked prices of the Common Stock in the over-the-counter
market as reported by NASDAQ. If the Common Stock bid and asked prices are not
then reported by NASDAQ, then Fair Market Value shall be the quote furnished by
any member of the National Association of Securities Dealers, Inc. selected from
time to time by the Company for that purpose. If no member of the National
Association of Securities Dealers, Inc. then furnishes quotes with respect to
the Common Stock, then Fair Market Value shall be determined by resolution of
the Company's Board of Directors. Notwithstanding the foregoing provisions of
this Section 4(h), if the Board of Directors shall at any time determine that it
is impracticable to apply the foregoing methods of determining Fair Market
Value, then the Board of Directors is hereby empowered to adopt any other
reasonable method for such purpose.
5. ADMINISTRATION OF THE PLAN. This Plan shall be self-effectuating.
Administrative determinations necessary or advisable for the administration or
interpretation of this Plan in order to carry out its provisions and purposes
shall be made by the officers of the Company.
6. ADDITIONAL REQUIREMENTS. Unless a Registration Statement with respect
thereto shall then be effective under the Securities Act of 1933, as amended
(the "Act"), each Award to a Participating Director is conditioned upon the
Company's prior receipt of a letter, in the form of Annex A hereto, duly
executed by such Participating Director, stating that Shares issued to him
As of June 20, 2001
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under this Plan will be held by such Participating Director solely for
investment and not with a view to, or for sale in connection with, any
distribution thereof, nor with any present intention of selling, transferring or
disposing of the same. Shares issued to a Participating Director hereunder may
not thereafter be offered for sale, sold or otherwise transferred unless (a) a
Registration Statement with respect thereto shall then be effective under the
Act, and the Company shall have been furnished with proof satisfactory to it
that the holder thereof has complied with applicable state securities laws, or
(b) the Company shall have received an opinion of counsel in form and substance
satisfactory to counsel for the Company that the proposed offer for sale, sale
or transfer is exempt from the registration requirements of the Act and may
otherwise be transferred in compliance with the Act and in compliance with any
other applicable law, including all applicable state securities laws; and the
Company may withhold transfer, registration and delivery of such Shares until
one of the foregoing conditions shall have been met.
7. LISTING AND REGISTRATION. The Company, in its discretion, may postpone
the issuance and delivery of Shares pursuant to any Award until completion of
such stock exchange listing, or registration or other qualification of such
Shares under any state or federal law, rule or regulation, as the Company may
consider appropriate; and may require any Participating Director to make such
representations and furnish such information as it considers appropriate in
connection with the issuance of Shares in compliance with applicable law,
including without limitation federal or state laws regulating the sale or
issuance of securities. Notwithstanding the foregoing, the Company shall be
under no obligation whatsoever to list, register or otherwise qualify any Shares
under this Plan.
8. RIGHTS AS A SHAREHOLDER. No Participating Director shall have any rights
as a shareholder with respect to the Shares awarded or to be awarded to him
under this Plan until the date of the issuance to him of a stock certificate
representing such Shares. No adjustment shall be made for dividends or for
distributions of any other kind with respect to Shares for which the record date
is prior to the date of the issuance to the Participating Director of a
certificate for the Shares.
9. AMENDMENT, SUSPENSION AND TERMINATION OF PLAN. The Board may suspend or
terminate this Plan or any portion thereof at any time and may amend this Plan
from time to time in such respects as the Board may deem advisable; provided,
however, that any amendment that changes the timing of Awards, the eligibility
requirements for Participating Directors, or the number of Shares subject to an
Award shall not be made more frequently than every six months unless otherwise
necessary to comply with the Internal Revenue Code of 1986, as amended, the
Employee Retirement Income Security Act of 1974, as amended, or any regulations
thereunder.
10. CAPITAL ADJUSTMENTS. In the event that (a) in connection with a merger
or consolidation of the Company or a sale by the Company of all or a part of its
assets, the outstanding Shares are exchanged for a different number or class of
shares of stock or other securities of the Company, or for shares of the stock
or other securities of any other entity; or (b) new, different or additional
shares or other securities of the Company or of another entity are received by
the holders of Shares, whether by way of recapitalization or otherwise; or (c)
any dividend in the form of stock is made to the holders of Shares, or any stock
split or reverse split pertaining to Shares is effected; then the Board shall,
in order to prevent the dilution or
As of June 20, 2001
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enlargement of rights under this Plan, make such adjustments in the number and
type of Shares or other securities authorized and the number and type of Shares
or other securities that may be awarded under this Plan as may be determined to
be appropriate and equitable.
11. RIGHTS OF DIRECTORS. Nothing in this Plan shall confer upon any
Director any right to serve as a Director for any period of time or to continue
his present or any other rate of compensation. A Participating Director's right
to receive Awards hereunder shall not be transferable in any way.
12. PLAN NOT EXCLUSIVE. The adoption of this Plan shall not preclude the
adoption by appropriate means of any stock option or other incentive plan for
Directors.
13. REQUIREMENTS OF LAW. The granting of Awards and the issuance of Shares
hereunder shall be subject to all applicable rules and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may
be required.
14. TERM OF PLAN. This Plan shall become effective upon its approval by the
Board, and shall continue in effect until terminated by the Board.
15. IN GENERAL. As used herein, the masculine pronoun shall include the
feminine and the neuter, as appropriate to the context. As used herein, the term
"Section" shall mean the appropriate Section of this Plan.
* * * * *
THE FOREGOING TRANSMATION, INC. AMENDED AND RESTATED DIRECTORS' STOCK PLAN
WAS DULY ADOPTED BY THE BOARD OF DIRECTORS OF TRANSMATION, INC. ON JUNE 20, 2001
/s/ PETER J. ADAMSKI
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PETER J. ADAMSKI, SECRETARY
As of June 20, 2001
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ANNEX A
ELECTION UNDER THE TRANSMATION, INC. DIRECTORS' STOCK PLAN
To: Transmation, Inc.
1. AWARD ELECTION (check one box only):
[ ] I hereby elect, for the fiscal year of Transmation, Inc. (the
"Company") ending March 31, ____, to receive in lieu of cash
Directors' compensation, awards of shares of the Company's
Common Stock, par value $.50 per share (the "Shares"), under
the Transmation, Inc. Directors' Stock Plan (the "Plan").
[ ] I hereby elect, for the fiscal year of the Company ending
March 31, ____, to receive in lieu of cash Directors'
compensation, awards of Shares under the Plan and to defer
receipt of _____________ Shares of such award until the
expiration of the deferral period for my Participant Stock
Account pursuant to the Plan.
Complete the following only if this is your first
deferral of an Award: I hereby elect to defer receipt
of all Shares credited to my Participant Stock
Account under the Plan until October 15, _______
(year, which must be at least two years after the
current year). I hereby request that my Participant
Stock Account be paid out at the end of the deferral
period as follows (check one circle only):
( ) lump sum
( ) annual installments (may not exceed ten)
Complete the following only to further extend the
deferral of your Participant Stock Account: I hereby
elect to further defer the payment from my
Participant Stock Account until October 15, _____
(insert new year, which must be at least two years
after the current year). (Note: this election to
further defer payment of a Participant Stock Account
must be made at least six months prior to the date
payments are scheduled to commence.)
[ ] I hereby elect, for the fiscal year of the Company ending
March 31, ____, to receive Directors' compensation only in
cash.
2. REPRESENTATIONS
If I have elected to receive awards of Shares under the Plan, then:
(a) I acknowledge and agree that unless a Registration Statement with
respect thereto shall then be effective under the Securities Act of 1933, as
amended (the "Act"), any
As of June 20, 2001
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Shares issued to me under the Plan shall be acquired by me solely for investment
and not with a view to, or for sale in connection with, any distribution
thereof, nor with any present intention of selling, transferring or disposing of
the same. I further acknowledge and agree that any Shares issued to me under the
Plan may not be offered for sale, sold or otherwise transferred or disposed of
unless (i) a Registration Statement with respect thereto shall then be effective
under the Act, and I shall have provided proof satisfactory to counsel for the
Company that I have complied with all applicable state securities laws, or (ii)
the Company shall have received an opinion of counsel in form and substance
satisfactory to counsel for the Company that the proposed offer for sale, sale
or transfer of the Shares is exempt from the registration requirements of the
Act and may otherwise be effected in compliance with any other applicable law,
including all applicable state securities laws.
(b) I agree that unless a Registration Statement with respect thereto shall
then be effective under the Act, a legend to this effect may be placed on each
certificate, and a stop transfer order may be placed against my account,
relating to the Shares issued to me under the Plan. In addition, each such
certificate shall bear such additional legends and statements as the Company
deems advisable to assure compliance with the provisions of Section 5 of the
Plan as well as all Federal and state laws and regulations, including securities
laws and regulations.
(c) I understand that the Company is relying upon the foregoing
representations and agreements in connection with the issuance to me of Shares
under the Plan. In consideration of such issuance, I hereby indemnify and hold
harmless the Company, and the officers, other Directors, employees and agents
thereof, from and against any and all liability, losses, damages, expenses and
attorneys' fees which they may hereafter incur, suffer or be required to pay by
reason of the falsity of, or my failure to comply with, any of the foregoing
representations and agreements.
If I have elected to receive awards of Shares under the Plan and to defer
receipt of such awards under the Plan, then:
I hereby acknowledge that the Shares that I have deferred will be credited
to a Participant Stock Account for my by the Company and that payment of such
Participant Stock Account will be made to me in accordance with the terms of the
Plan. In addition, I acknowledge that such Participant Stock Account is for
bookkeeping purposes only; that the Company is not obligated to acquire or set
aside any particular assets for the discharge of its obligations; that I have no
property rights in any particular assets of the Company, whether or not held for
the purpose of funding the Company's obligations; and that my rights or those of
my estate in such Participant Stock Account shall be an unsecured claim against
the general assets of the Company.
Dated:
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(signature)
As of June 20, 2001
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