EXHIBIT 10.28
NATIONAL PROCESSING, INC.
2000 STOCK OPTION PLAN
as Amended and Restated
Effective November 14, 2002
1. PURPOSES. The purposes of this 2000 Stock Option Plan are to provide
employment incentives and to encourage capital accumulation and stock
ownership by Eligible Employees of National Processing, Inc. ("National
Processing") or any of its Subsidiaries, and to provide to designated
Optionees under stock options heretofore or hereafter granted pursuant to
any stock option plan of National Processing or any of its Subsidiaries an
alternative method of realizing the benefits provided by such stock
options.
2. DEFINITIONS. As used in this Plan,
(a) "Additional Option" means an Option Right granted to an Optionee
to purchase a number of shares of Common Stock equal to the number of
shares of already owned Common Stock relinquished by the Optionee as
payment of the exercise price upon exercise of an Option Right and/or the
number of shares of Common Stock tendered or relinquished as payment of the
amount to be withheld under applicable federal, state and local income tax
laws in connection with the exercise of an option as described in Section
5.
(b) "Additional Option Feature" means a feature of an Option that
provides for the automatic grant of an Additional Option in accordance with
the provisions described in Section 5.
(c) The term "Appreciation Right" means a right granted pursuant to
Section 6 of this Plan.
(d) The term "Board of Directors" means the Board of Directors of
National Processing.
(e) The term "Committee" means the Committee provided for in Paragraph
10(a) of this Plan.
(f) The term "Common Stock" means Common Stock, of National Processing
or any security into which such Common Stock may be changed by reason of
any transaction or event of the type described in Section 8 of this Plan.
(g) The term "Eligible Employees" means persons who are at the time
the officers (including officers who are members of the Board of Directors)
and other key employees of National Processing or of any of its
Subsidiaries.
(h) The term "Internal Revenue Code" means the Internal Revenue Code
of 1986, as amended from time to time.
(i) The term "Incentive Stock Option" means an Option Right granted by
National Processing to an Eligible Employee, which Option Right is intended
to qualify as an "Incentive Stock Option" as that term is used in Section
422 of the Internal Revenue Code.
(j) The term "Market Value per Share" means, at any date, the closing
price of a share of Common Stock on the New York Stock Exchange on the
trading day immediately preceding such date as reported by the Wall Street
Journal (Midwest Edition) or, if the Common Stock shall be primarily traded
in another market, as determined in a manner specified by the Board of
Directors using quotations in such other market.
(k) The term "Option Agreement" shall have the meaning set forth in
Section 6(e).
(l) The term "Optionee" shall mean the optionee named in an agreement
evidencing an Outstanding Option.
(m) The term "Option Right" means the right to purchase a share of
Common Stock upon exercise of an Outstanding Option.
(n) The term "Outstanding Option" means, at any time, an option to
purchase shares of Common Stock granted by National Processing or any of
its Subsidiaries pursuant to this Plan or any other stock option plan of
National Processing or any such Subsidiary now or hereafter in effect, or
pursuant to any stock option plan of any corporation which is merged into
National Processing and where National Processing has by action of its
Board of Directors, assumed the obligations of such corporation under such
stock option plan, all whether or
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not such option is at the time exercisable, to the extent that such option
at such time has not been exercised and has not terminated.
(o) The term "Spread" means the excess of the Market Value per Share
of Common Stock on the date when an Appreciation Right is exercised over
the option price provided for in the related Option Right.
(p) The term "Subsidiary" shall mean any entity in which National
Processing beneficially owns or controls, directly or indirectly, 50% or
more of the voting equity securities.
3. SHARES AVAILABLE UNDER PLAN.
(a) The shares of Common Stock which may be made the subject of Option
Rights and Appreciation Rights pursuant to this Plan may be treasury shares
or shares of original issue or a combination of the foregoing.
(b) Subject to adjustments in accordance with Section 8 of this Plan,
the maximum number of shares of Common Stock which may be sold upon the
exercise of Option Rights granted pursuant to this Plan shall be 5,000,000
shares of Common Stock which are made available for sale by virtue of this
Plan. For purposes of determining the number of shares that may be sold
under the Plan, such number shall increase by the number of shares
surrendered by an optionee or relinquished to National Processing (a) in
connection with the exercise of an Option Right or (b) in payment of
federal, state and local income tax withholding liabilities upon exercise
of an Option Right.
(c) Subject to adjustments in accordance with Section 8 of this Plan,
the maximum number of shares of Common Stock which may be delivered upon
the exercise of Appreciation Rights granted pursuant to this Plan shall not
exceed 5,000,000.
(d) Shares covered by Option Rights cancelled upon exercise of
Appreciation Rights shall not be available for the granting of further
Option Rights under this Plan or under any other stock option plan of
National Processing or of any of its Subsidiaries, anything in this Plan or
such other stock option plan to the contrary notwithstanding.
4. GRANTS OF OPTION RIGHTS. The Board of Directors may, from time to time and
upon such terms and conditions as it may determine, authorize the granting
to Eligible Employees of Option Rights. Each such grant may utilize any or
all of the authorizations, and shall be subject to all of the limitations,
contained in the following provisions:
(a) Each grant shall specify the number of shares of Common Stock to
which it pertains.
(b) Each grant shall specify an option price per share not less than
the Market Value per Share on the date of grant.
(c) Successive grants may be made to the same Eligible Employee
whether or not any Option Rights previously granted to such Eligible
Employee remain unexercised. No Eligible Employee may, however, be granted
under this plan, in the aggregate, more than 1,500,000 Option Rights or
Appreciation Rights, subject to adjustment pursuant to Section 8 of this
Plan over any ten year period.
(d) Option Rights granted under this Plan may be (i) options which are
intended to qualify under particular provisions of the Internal Revenue
Code, as in effect from time to time, (ii) options which are not intended
so to qualify, or (iii) combinations of the foregoing.
(e) The date of grant of each Option Right shall be the date of its
authorization by the Board of Directors or such later date designated by
the Board of Directors, except that the date of grant of an Additional
Option shall be the date of exercise of the underlying Option Right. No
Option Right shall be exercisable more than ten years from such date of
grant.
(f) Upon exercise of an Option Right, the option price shall be
payable (i) in cash, (ii) by the transfer to National Processing by the
Optionee of shares of Common Stock with a value (Market Value per Share
times the number of shares) equal to the total option price, or (iii) by a
combination of such methods of payment.
(g) Each grant of Option Rights shall be evidenced by an agreement
executed on behalf of National Processing by any officer designated by the
Board of Directors for this purpose and delivered to and accepted by the
Eligible Employee and shall contain such terms and provisions, consistent
with this Plan, as the Board of Directors may approve.
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(h) No Option Rights, intended to be an Incentive Stock Option, shall
be granted hereunder to any Optionee which would allow the aggregate fair
market (determined at the time the Option Rights are granted) of the stock
subject of Option Rights, including the Incentive Stock Option in question,
which such Optionee may exercise for the first time during any calendar
year, to exceed $100,000. Any Option Rights intended to be Incentive Stock
Options granted by any "parent," as such term is used in Section 422A of
the Internal Revenue Code, as amended, of National Processing pursuant to
such parent's Stock Option plans, shall be included in the definition of
Option Rights for the purpose of determining the $100,000 limitation.
5. ADDITIONAL OPTION.
(a) The Board of Directors may, at or after the date of grant of
Option Rights, grant Additional Options.
(b) If an Optionee exercises an Outstanding Option that has an
Additional Option Feature by transferring already owned shares of Common
Stock and/or when shares of Common Stock are tendered or relinquished as
payment of the amount to be withheld under applicable federal, state and
local income tax laws (at withholding rates not to exceed the Optionee's
applicable marginal tax rates) in connection with the exercise of an
option, the Optionee shall automatically be granted an Additional Option.
The Additional Option shall be subject to the following provisions:
(1) The Additional Option shall cover the number of shares of Common
Stock equal to the sum of (A) the number of shares of Common Stock
delivered as consideration upon the exercise of the previously granted
Outstanding Option to which such Additional Option Feature relates and (B)
the number of shares of Common Stock tendered or relinquished as payment of
the amount to be withheld under applicable federal, state and local income
tax laws in connection with the exercise of the option to which such
Additional Option Feature relates;
(2) The Additional Option will not have an Additional Option Feature
unless the Board of Directors directs otherwise;
(3) The Additional Option option price shall be 100% of the Market
Value per Share on the date the employee delivers shares of Common Stock to
exercise the Option that has the Additional Option Feature and/or delivers
or forfeits shares of Common Stock in payment of income tax withholding on
the exercise of an Option that has the Additional Option Feature;
(4) The Additional Option shall have the same termination date and
other termination provisions as the underlying Option that had the
Additional Option Feature.
6. GRANTS OF APPRECIATION RIGHTS. The Board of Directors may from time to time
authorize the granting of Appreciation Rights in respect of any or all of
the Option Rights under any Outstanding Option (including Options Rights
simultaneously granted) to the Optionee thereunder. An Appreciation Right
shall be a right in the Optionee to receive from National Processing an
amount which shall be determined by the Board of Directors and shall be
expressed as a percentage of the Spread (not exceeding 100%) at the time of
exercise. To the extent such Optionee elects to exercise such Appreciation
Right instead of the related Option Right, the related Option Right shall
be cancelled, and vice versa. Each such grant may utilize any or all of the
authorizations, and shall be subject to all of the limitations, contained
in the following provisions:
(a) Any grant may permit the exercise of an Appreciation Right with
respect to the value of shares of Common Stock covered by the related
Option Rights.
(b) Any grant may specify that the amount payable on exercise of an
Appreciation Right may be paid by National Processing in cash, in shares of
Common Stock or in any combination thereof, and may either grant to the
Optionee or retain in the Board of Directors the right to elect among those
alternatives.
(c) Each grant shall provide that the maximum number of shares of
Common Stock deliverable upon exercise of an Appreciation Right may not
exceed the number of shares of Common Stock purchasable upon exercise of
the related Option Rights.
(d) Any grant may specify waiting periods before exercise and
permissible exercise dates or periods. No Appreciation Right shall be
exercisable except at a time when the related Option Right is also
exercisable.
(e) Each grant of an Appreciation Right shall be evidenced by an
agreement executed on behalf of National City by any officer designated by
the Board of Directors for this purpose and delivered to and
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accepted by the Optionee, which agreement shall describe such Appreciation
Right, identify the related Option Rights, state that such Appreciation
Right is subject to all the terms and conditions of this Plan, including
the right of the Board of Directors to amend, suspend or terminate such
Appreciation Right as set forth in Paragraph 11(c) of this Plan, and
contain such other terms and provisions, consistent with this Plan, as the
Board of Directors may approve (the "Option Agreement"). A failure by the
Optionee to execute and deliver to National Processing the Option Agreement
within 60 days after the grant of Option Rights may terminate the Option
Rights upon the determination of the Board of Directors.
7. TRANSFERABILITY. Except as otherwise provided for by the Board of
Directors, no Option Right including any related Appreciation Right shall
be transferable by an Optionee other than by will or the laws of descent
and distribution. Unless the Board of Directors directs otherwise, Option
Rights and Appreciation Rights shall be exercisable during the Optionee's
lifetime only by the Optionee or by the Optionee's guardian or legal
representative.
8. ADJUSTMENTS. The Board of Directors may make or provide for such
adjustments in the maximum numbers and kind of shares of Common Stock
specified in Paragraphs 3(b) and (c) and 4(c) of this Plan, in the numbers
and kind of shares of Common Stock covered by Option Rights and
Appreciation Rights granted hereunder, and in the prices per share
applicable under such Option Rights and Appreciation Rights, as such Board
in its sole discretion, exercised in good faith, may determine is equitably
required to prevent dilution or enlargement of the rights of Optionees that
otherwise would result from any stock dividend, stock split, combination of
shares, recapitalization or other change in the capital structure of
National Processing, merger, consolidation, spin-off, reorganization,
partial or complete liquidation, issuance of rights or warrants to purchase
securities, or other corporate transaction or event having an effect
similar to any of the foregoing.
9. FRACTIONAL SHARES. National Processing shall not be required to issue any
fractional share of Common Stock pursuant to this Plan. The Board of
Directors may provide for the elimination of fractions or for the
settlement of fractions in cash.
10. ADMINISTRATION OF THE PLAN.
(a) This Plan shall be administered by the Board of Directors, which
may from time to time delegate all or any part of its authority under this
Plan to a Compensation Committee of the Board of Directors, a subcommittee
of the Compensation Committee, or another committee of directors of
National Processing appointed by the Board of Directors to serve as the
committee responsible for administering this Plan (the "Committee"). To the
extent of such delegation, references herein to the "Board of Directors"
shall include the Committee. The Board of Directors may name assistants who
may be, but need not be, members of the Committee. Such assistants shall
serve at the pleasure of the Board of Directors, and shall perform such
functions as are provided for herein and such other functions as may be
assigned by the Board of Directors.
(b) The interpretation and construction by the Board of Directors of
any provision of this Plan or of any agreement evidencing the grant of
Option Rights or Appreciation Rights and any determination by the Board of
Directors pursuant to any provision of this Plan or of any such agreement
shall be final and conclusive. No member of the Board of Directors or any
assistant shall be liable for any action taken or omitted in connection
with the interpretation or administration of this Plan or any grant unless
attributable to his or her own willful misconduct or lack of good faith.
11. AMENDMENTS, ETC.
(a) This Plan may be amended from time to time by the Board of
Directors but without further approval by the shareholders of National
Processing no such amendment shall (i) increase the maximum numbers of
shares of Common Stock specified in Paragraphs 3(b) and (c) and 4(c) of
this Plan (except that adjustments authorized by Section 8 of this Plan
shall not be limited by this provision), (ii) change the definition of
"Eligible Employees", or (iii) materially increase the benefits accruing to
Optionees hereunder.
(b) Except as provided in Section 8 of the Plan, the Committee shall
not, without the further approval of shareholders of National City,
authorize the amendment of any outstanding Option Right to reduce the
option price. Furthermore, no Option Rights shall be cancelled and replaced
with awards having a lower option
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price (except as provided by Sections 5 and 8 of this Plan) without the
further approval of the shareholders of National Processing.
(c) The Board of Directors may at any time amend, suspend or terminate
any agreement evidencing Appreciation Rights granted under this Plan; in
the case of an amendment, the amended Appreciation Right shall conform to
the provisions of this Plan.
(d) In the case of any Option or Appreciation Right not immediately
exercisable in full, the Board of Directors in its discretion may
accelerate the time at which Option or Appreciation Rights may be
exercised.
12. ASSUMPTIONS.
(a) In the event that a corporation is merged into National
Processing, and National Processing is the survivor of such merger, the
Board of Directors may elect, in its sole discretion, to assume under this
Plan any or all outstanding options granted by such corporation to its
officers and employees under any stock option plan adopted by it prior to
such merger. Such assumptions shall be on such terms and conditions as the
Board of Directors may determine in its sole discretion, provided, however,
that the options as assumed do not provide or contain any terms, conditions
or rights which an Option Right may not provide or contain under Sections 2
through 10 hereunder.
13. MISCELLANEOUS.
(a) All expenses and costs in connection with the operation of the
Plan shall be borne by National Processing.
(b) This Plan shall be construed in accordance with and governed by
the internal substantive laws of the State of Ohio.
(c) This Plan shall be binding upon and inure to the benefit of
National Processing, its successors and assigns and each Participant and
his or her beneficiaries, heirs, executors, administrators and legal
representatives.
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