Exhibit 99.02
CARDINAL HEALTH, INC.
EMPLOYEE STOCK PURCHASE PLAN
SECTION 1 - PURPOSE
The Cardinal Health, Inc. Employee Stock Purchase Plan is adopted and
established by Cardinal Health, Inc., an Ohio corporation, on the date set forth
below, effective as of January 3, 2000, for the general benefit of the Employees
of the Company and of certain of its Subsidiaries. The purpose of the Plan is to
facilitate the purchase of Shares by Eligible Employees.
SECTION 2 - DEFINITIONS
a. "ACT" shall mean the Securities Act of 1933, as amended.
b. "ADMINISTRATOR" shall mean the Board of Directors of the Company, a
designated committee thereof, or the person(s) or entity delegated the
responsibility of administering the Plan, which initially shall be the Cardinal
Health, Inc. Profit Sharing and Retirement Savings Plan Committee.
c. "AGENT" shall mean the bank, brokerage firm, financial institution, or
other entity or person(s) engaged, retained or appointed to act as the agent of
the Employer and of the Participants under the Plan, which initially shall be
Merrill Lynch, Pierce, Fenner, & Smith, Inc.
d. "BOARD" shall mean the Board of Directors of the Company.
e. "CLOSING VALUE" shall mean, as of a particular date, the value of a
Share determined by the closing sales price for such Share (or the closing bid,
if no sales were reported) as quoted on The New York Stock Exchange for the last
market trading day prior to the date of determination, as reported in THE WALL
STREET JOURNAL or such other source as the Administrator deems reliable.
f. "CODE" shall mean the Internal Revenue Code of 1986, as amended and
currently in effect, or any successor body of federal tax law.
g. "COMPANY" shall mean Cardinal Health, Inc., including any successor
thereto.
h. "COMPENSATION" shall mean wages, salaries, fees for professional
service and other amounts received for personal services actually rendered in
the course of employment with the Employer (including, but not limited to,
commissions paid salesmen, compensation for services on the basis of a
percentage of profits, commissions on insurance premiums, tips and bonuses)
including amounts excludible from the Employee's gross income under Code Section
402(a)(8) (relating to a Code Section 401(k) arrangement), Code Section 402(h)
(relating to a Simplified Employee Pension), Code Section 125 (relating to a
cafeteria plan) or Code Section 403(b) (relating to a tax-sheltered annuity) and
compensation paid by the Employer to an Employee through another person under
the common paymaster provisions of Code Sections
3121(s) and 3306(p). Compensation does not include: (1) amounts realized from
the exercise of a non-qualified stock option, or when restricted stock (or
property) held by an Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture, (2) amounts realized from the sale,
exchange, or other disposition of stock acquired under a qualified stock option,
(3) moving allowances, automobile allowances, tuition reimbursement,
financial/tax planning reimbursement, other extraordinary compensation,
including tax "gross-up" payments, and imputed income from other
employer-provided benefits, and (4) other amounts that receive special tax
benefits, such as premiums for group term life insurance or contributions made
by the Employer (whether or not under salary reduction agreement) towards the
purchase of an annuity contract described in Code Section 403(b) (whether or not
the contributions are excludible from the gross income of the Employee), other
than amounts described above.
i. "DESIGNATED SUBSIDIARIES" shall mean all Subsidiaries whose Employees
have been designated by the Administrator, in its sole discretion, as eligible
to participate in the Plan.
j. "ELIGIBLE EMPLOYEE" means any Employee who (1) has worked as an
employee of an Employer for at least thirty (30) days and (2) is customarily
employed for at least five (5) months each calendar year or who is classified as
a "PRN" or on-call Employee.
k. "EMPLOYEE" means any person who performs services as a common law
employee of an Employer, and does not include "leased employees," as that term
is defined under Code Section 414(n), or other individuals providing services to
an Employer in a capacity as an independent contractor.
l. "EMPLOYER" means, individually and collectively, the Company and the
Designated Subsidiaries.
m. "ENROLLMENT PERIOD" shall mean the period immediately preceding the
Offering Period that is designated by the Administrator in its discretion as the
period during which an Eligible Employee may elect to participate in the Plan.
n. "OFFERING PERIOD" shall mean the period during which Participants in
the Plan authorize payroll deductions to fund the purchase of Shares on their
behalf under the Plan pursuant to the options granted to them hereunder.
o. "PARTICIPANT" means any Eligible Employee who has elected to
participate in the Plan for an Offering Period by authorizing payroll deductions
and following all applicable procedures established by the Administrator during
the Enrollment Period for such Offering Period.
p. "PLAN" shall mean this Cardinal Health, Inc. Employee Stock Purchase
Plan.
q. "PLAN ACCOUNT" shall mean the individual account established by the
Agent for each Participant for purposes of accounting for and/or holding each
Participant's payroll deductions, Shares, etc.
2
r. "PLAN YEAR" shall mean the fiscal year of the Company.
s. "PURCHASE PRICE" shall mean, for each Share purchased in accordance
with Section 4 hereof, an amount equal to the lesser of (1) eighty-five percent
(85%) of the Closing Value of a Share on the first Trading Day of each Offering
Period, or the earliest date thereafter as is administratively feasible (which
for Plan purposes shall be deemed to be the date the option to purchase such
Shares was granted to each Eligible Employee who is, or elects to become, a
Participant); or (2) eighty-five percent (85%) of the Closing Value of such
Share on the last Trading Day of the Offering Period, or the earliest date
thereafter as is administratively feasible (which for Plan purposes shall be
deemed to be the date each such option to purchase such Shares was exercised).
t. "SHARES" means the Class A common shares, without par value, of the
Company.
u. "SUBSIDIARY" shall mean a corporation, domestic or foreign, of which
not less than fifty percent (50%) of the voting shares are held by the Company
or a Subsidiary, whether or not such corporation now exists or is hereafter
organized or acquired by the Company or a Subsidiary (or as otherwise may be
defined in Code Section 424).
v. "TRADING DAY" shall mean a day on which national stock exchanges and
The New York Stock Exchange are open for trading.
SECTION 3 - ELIGIBLE EMPLOYEES
a. IN GENERAL. Participation in the Plan is voluntary. All Eligible
Employees of an Employer are eligible to participate in the Plan. All Eligible
Employees granted options to purchase Shares hereunder shall have the same
rights and privileges as every other such Eligible Employee, and only Eligible
Employees of an Employer satisfying the applicable requirements of the Plan will
be entitled to be granted options hereunder.
b. LIMITATIONS ON RIGHTS. An Employee who otherwise is an Eligible
Employee shall not be entitled to purchase Shares under the Plan if: (1) such
purchase would cause such Eligible Employee to own Shares (including any Shares
which would be owned if such Eligible Employee purchased all of the Shares made
available for purchase by such Eligible Employee under all options or rights
then held by such Eligible Employee, whether or not then exercisable)
representing five percent (5%) or more of the total combined voting power or
value of each class of stock of the Company or any Subsidiary; or (2) such
purchase would cause such Eligible Employee to have options or rights to
purchase more than $25,000 of Shares under the Plan (and under all other
employee stock purchase plans of the Company and its Subsidiary corporations
which qualify for treatment under Section 423 of the Code) for any calendar year
in which such rights are outstanding (based on the Closing Value of such Shares,
determined as of the date such rights are granted and can first be exercised
hereunder). For purposes of clause (1) of this subsection b., the attribution
rules set forth in Section 424(d) of the Code and related regulations shall
apply.
3
SECTION 4 - ENROLLMENT AND OFFERING PERIODS
a. ENROLLING IN THE PLAN. To participate in the Plan, an Eligible Employee
must enroll in the Plan. Enrollment for a given Offering Period will take place
during the Enrollment Period for such Offering Period. The Administrator shall
designate the initial Enrollment Period and each subsequent Enrollment Period
and the Offering Period to which each Enrollment Period relates. Participation
in the Plan with respect to any one or more of the Offering Periods shall
neither limit nor require participation in the Plan for any other Offering
Period.
b. THE OFFERING PERIOD. Any Employee who is an Eligible Employee and who
desires to be granted options to purchase Shares hereunder must enroll in
accordance with the procedures established by the Administrator during an
Enrollment Period. Such authorization shall be effective for the Offering Period
immediately following such Enrollment Period. The duration of an Offering Period
shall be determined by the Administrator prior to the Enrollment Period and
shall commence on the first day (or the first Trading Day) of the Offering
Period and end on the last day (or the last Trading Day) of the Offering Period;
provided, however, that if the Administrator terminates the Plan during an
Offering Period, pursuant to its authority in Section 17 of the Plan, such
Offering Period shall be deemed to end on the date the Plan is terminated. The
termination of the Plan and the Offering Period shall end the Participant's
rights to contribute amounts to the Plan or continue participation in the
Offering Period. The date of termination of the Plan shall be deemed to be the
final day of the Offering Period for purposes of determining the Purchase Price
under the Offering Period and all amounts contributed during the Offering Period
will be used as of such termination date to purchase Shares in accordance with
the general provisions of Section 9.
The Administrator may designate one or more Offering Periods during each
Plan Year during the term of this Plan. On the first day (or the first Trading
Day) of each Offering Period, each Participant shall be granted an option to
purchase Shares under the Plan. Each option granted hereunder shall expire at
the end of the Offering Period for which it was granted. In no event may an
option granted hereunder be exercised after the expiration of 27 months from the
date of grant.
c. CHANGING ENROLLMENT. The offering of Shares pursuant to options granted
hereunder the Plan shall occur only during an Offering Period and shall be made
only to Participants. Once an Eligible Employee is enrolled in the Plan, the
Administrator or Employer will inform the Agent of such fact. Once enrolled, a
Participant shall continue to participate in the Plan for each succeeding
Offering Period until he or she terminates his or her participation by revoking
his or her payroll deduction authorization or ceases to be an Eligible Employee.
Once a Participant has elected to participate under the Plan, that Participant's
payroll deduction authorization shall apply to all subsequent Offering Periods
unless and until the Participant ceases to be an Eligible Employee, or modifies
or terminates said authorization. If a Participant desires to change his or her
rate of contribution, he or she may do so effective for the next Offering Period
by following the procedures established by the Administrator during the
Enrollment Period immediately preceding such Offering Period.
4
SECTION 5 - TERM OF PLAN
This Plan shall be in effect from January 3, 2000, until it is terminated
by action of the Board.
SECTION 6 - NUMBER OF SHARES TO BE MADE AVAILABLE
Subject to adjustment as provided in Section 16 hereof, the total number
of Shares made available for purchase by Participants granted options which are
exercised under Section 9 hereof is 5,000,000, which may consist of authorized
but unissued shares, treasury shares, or shares purchased by the Plan in the
open market. The provisions of Section 9 b. shall control in the event the
number of Shares covered by options which are exercised for any Offering Period
exceeds the number of Shares available for sale under the Plan. If all of the
Shares authorized for sale under the Plan have been sold, the Plan shall either
be continued through additional authorizations of Shares made by the Board (such
authorizations must, however, comply with Section 17 hereof), or shall be
terminated in accordance with Section 17 hereof.
SECTION 7 - USE OF FUNDS
All payroll deductions received or held by an Employer under the Plan may
be used by the Employer for any corporate purpose, and the Employer shall not be
obligated to segregate such payroll deductions. Any amounts held by an Employer
or other party holding amounts in connection with or as a result of payroll
withholding made pursuant to the Plan and pending the purchase of Shares
hereunder shall be considered a non-interest-bearing, unsecured indebtedness
extended to the Employer or other party by the Participants. Administrative
expenses of the Plan shall be allocated to each Participant's Plan Account
unless such expenses are paid by the Employer.
SECTION 8 - AMOUNT OF CONTRIBUTION; METHOD OF PAYMENT
a. PAYROLL WITHHOLDING. Except as otherwise specifically provided herein,
the Purchase Price will be payable by each Participant by means of payroll
withholding. The withholding shall be in increments of one percent (1%). The
minimum withholding permitted shall be an amount equal to one percent (1%) of a
Participant's Compensation and the maximum withholding shall be an amount equal
to fifteen percent (15%) of a Participant's Compensation. In any event, the
total withholding permitted to be made by any Participant for a calendar year
shall be limited to the sum of $21,250. The actual percentage of Compensation to
be deducted shall be specified by a Participant in his or her authorization for
payroll withholding. Participants may not deposit any separate cash payments
into their Plan Accounts.
b. APPLICATION OF WITHHOLDING RULES. Payroll withholding will commence
with the first paycheck issued during the Offering Period and will, except as
otherwise provided herein, continue with each paycheck throughout the entire
Offering Period, except for pay periods for which such Participant receives no
compensation (e.g., uncompensated personal leave, leave of absence). A pay
period which ends at such time that it is administratively impracticable to
credit any paycheck for such pay period to the then-current
5
Offering Period will be credited in its entirety to the immediately subsequent
Offering Period. A pay period which overlaps Offering Periods will be credited
in its entirety to the Offering Period in which it is paid. Payroll withholding
shall be retained by the Employer or other party responsible for making such
payment to the Participant, until applied to the purchase of Shares as described
in Section 9 and the satisfaction of any related federal, state or local
withholding obligations (including any employment tax obligations).
At the time the Shares are purchased, or at the time some or all of the
Shares issued under the Plan are disposed of, Participants must make adequate
provision for the Employer's federal, state, local or other tax withholding
obligations (including employment taxes), if any, which arise upon the purchase
or disposition of the Shares. At any time, the Employer may, but shall not be
obligated to, withhold from each Participant's Compensation the amount necessary
for the Employer to meet applicable withholding obligations, including any
withholding required to make available to the Employer any tax deductions or
benefits attributable to the sale or early disposition of Shares by the
Participant. Each Participant, as a condition of participating under the Plan,
agrees to bear responsibility for all federal, state, and local income taxes
required to be withheld from his or her Compensation as well as the
Participant's portion of FICA (both the OASDI and Medicare components) with
respect to any Compensation arising on account of the purchase or disposition of
Shares. The Employer may increase income and/or employment tax withholding on a
Participant's Compensation after the purchase or disposition of Shares in order
to comply with federal, state and local tax laws, and each Participant agrees to
sign any and all appropriate documents to facilitate such withholding.
SECTION 9 - PURCHASING, TRANSFERRING SHARES
a. MAINTENANCE OF PLAN ACCOUNT. Upon the exercise of a Participant's
initial option to purchase Shares under the Plan, the Agent shall establish a
Plan Account in the name of such Participant. At the close of each Offering
Period, the aggregate amount deducted during such Offering Period by the
Employer from a Participant's Compensation (and credited to a
non-interest-bearing account maintained by the Employer or other party for
bookkeeping purposes) will be communicated by the Employer to the Agent and
shall thereupon be credited by the Agent to such Participant's Account (unless
the Participant has given notice to the Administrator of his or her revocation
of authorization prior to the date such communication is made). As of the last
day of each Offering Period, or as soon thereafter as is administratively
practicable, each Participant's option to purchase Shares will be exercised
automatically for him or her by the Agent with respect to those amounts reported
to the Agent by the Administrator or Employer as creditable to that
Participant's Plan Account. On the date of exercise, the amount then credited to
the Participant's Plan Account for the purpose of purchasing Shares hereunder
will be divided by the Purchase Price and there shall be transferred to the
Participant's Plan Account by the Agent the number of full and fractional shares
which results.
The Agent shall hold in its name, or in the name of its nominee, all
Shares so purchased and allocated. No certificate will be issued to a
Participant for Shares held in his or her Plan Account unless he or she so
requests in writing or unless such Participant's active participation in the
Plan is terminated due to death, disability, separation from service or
retirement. Notwithstanding any provision herein to the contrary, no
certificates shall be issued for Shares
6
until such Shares have been held in the Participant's Plan Account for a period
of at least 24 months following the date of exercise of the option to purchase
such Shares.
b. INSUFFICIENT NUMBER OF AVAILABLE SHARES. In the event: the number of
Shares covered by options which are exercised for any Offering Period exceeds
the number of Shares available for sale under the Plan, the number of Shares
actually available for sale hereunder shall be limited to the remaining number
of Shares authorized for sale under the Plan and shall be allocated by the Agent
among the Participants in proportion to each Participant's Compensation during
the Offering Period over the total Compensation of all Participants during the
Offering Period. Any excess amounts withheld and credited to Participants
Accounts then shall be returned to the Participants as soon as is
administratively practicable.
c. HANDLING EXCESS SHARES. In the event that the number of Shares which
would be credited to any Participant's Plan Account in any Offering Period
exceeds the limit specified in Section 3 b. hereof, such Participant's Account
shall be credited with the maximum number of Shares permissible, and the
remaining amounts will be refunded in cash as soon as administratively
practicable.
d. STATUS REPORTS. Statements of each Participant's Plan Account shall be
given to participating Employees at least annually.
SECTION 10 - DIVIDENDS AND OTHER DISTRIBUTIONS
a. REINVESTMENT OF DIVIDENDS. Cash dividends and other cash distributions
received by the Agent on Shares held in its custody hereunder will be credited
to the Plan Accounts of individual Participants in accordance with such
Participants' interests in the Shares with respect to which such dividends or
distributions are paid or made, and will be applied, as soon as practical after
the receipt thereof by the Agent, to the purchase in the open market at
prevailing market prices of the number of whole Shares capable of being
purchased with such funds (after deduction of any bank service fees, brokerage
charges, transfer taxes, and any other transaction fee, expense or cost payable
in connection with the purchase of such Shares and not otherwise paid by the
Employer).
b. SHARES TO BE HELD IN AGENT'S NAME. All purchases of Shares made
pursuant to this Section will be made in the name of the Agent or its nominee,
shall be held as provided in Section 9 hereof, and shall be transferred and
credited to the Plan Account(s) of the individual Participant(s) to which such
dividends or other distributions were credited. Dividends paid in the form of
Shares will be allocated by the Agent, as and when received, with respect to
Shares held in its custody hereunder to the Plan Accounts of individual
Participants in accordance with such Participants' interests in such Shares with
respect to which such dividends were paid. Property, other than Shares or cash,
received by the Agent as a distribution on Shares held in its custody hereunder,
shall be sold by the Agent for the accounts of the Participants, and the Agent
shall treat the proceeds of such sale in the same manner as cash dividends
received by the Agent on Shares held in its custody hereunder.
7
c. TAX RESPONSIBILITIES. The automatic reinvestment of dividends under the
Plan will not relieve a Participant (or Eligible Employee with a Plan Account)
of any income or other tax that may be due on or with respect to such dividends.
The Agent shall report to each Participant (or Eligible Employee with a Plan
Account) the amount of dividends credited to his or her Plan Account.
SECTION 11 - VOTING OF SHARES
A Participant shall have no interest or voting right in the Shares covered
by his or her option until such option has been exercised. Shares held for a
Participant (or Eligible Employee with a Plan Account) in his or her Plan
Account will be voted in accordance with the Participant's (or Eligible
Employee's) express directions. In the absence of any such directions, such
Shares will not be voted.
SECTION 12 - IN-SERVICE DISTRIBUTION OR SALE OF SHARES
a. SALE OF SHARES. Subject to the provisions of Section 19, a Participant
may at any time, and without withdrawing from the Plan, by giving notice to the
Agent, direct the Agent to sell all or part of the Shares held on behalf of the
Participant. Upon receipt of such a notice, the Agent shall, as soon as
practicable after receipt of such notice, sell such Shares in the marketplace at
the prevailing market price and transmit the net proceeds of such sale (less any
bank service fees, brokerage charges, transfer taxes, and any other transaction
fee, expense or cost) to the Participant.
b. IN-SERVICE SHARE DISTRIBUTIONS. A Participant may, without withdrawing
from the Plan, request that a certificate for all or part of the full Shares
held in his or her Plan Account be sent to him or her after the relevant Shares
have been purchased and allocated SUBJECT TO THE REQUIREMENT THAT SUCH SHARES BE
HELD IN THE PARTICIPANT'S PLAN ACCOUNT FOR A PERIOD OF AT LEAST 24 MONTHS AFTER
THE DATE OF EXERCISE, AS DESCRIBED IN SECTION 9 a., ABOVE.
All such requests must be submitted in writing to the Agent. No
certificate for a fractional Share will be issued; the fair value of fractional
Shares on the date of withdrawal of all Shares credited to a Participant's Plan
Account shall be paid in cash to such Participant. The Plan may impose a
reasonable charge, to be paid by the Participant, for each stock certificate so
issued prior to the date active participation in the Plan ceases; such charge
shall be paid by the Participant to the Administrator or Employer prior to the
date any distribution of a certificate evidencing ownership of such Shares
occurs.
SECTION 13 - CESSATION OF ACTIVE PARTICIPATION
A Participant may at any time, by giving notice to the Administrator or
Employer, revoke his or her authorization for payroll deduction for the Offering
Period in which such revocation is made. A PARTICIPANT WHO REVOKES AUTHORIZATION
FOR PAYROLL DEDUCTION MAY NOT AGAIN PARTICIPATE UNDER THE PLAN UNTIL THE NEXT
OFFERING PERIOD IMMEDIATELY SUBSEQUENT TO THE OFFERING PERIOD
8
DURING WHICH THE PARTICIPANT REVOKED PAYROLL DEDUCTION AUTHORIZATION WITH
RESPECT THERETO.
SECTION 14 - SEPARATION FROM EMPLOYMENT
Separation from employment for any reason, including death, disability,
termination or retirement shall be treated automatically as a withdrawal from
the Plan.
SECTION 15 - ASSIGNMENT
Neither payroll deductions credited to a Participant's Plan Account nor
any rights with regard to options or Shares held under the Plan may be assigned,
alienated, transferred, pledged, or otherwise disposed of in any way by a
Participant other than by will or the laws of descent and distribution. Any such
assignment, alienation, transfer, pledge, or other disposition shall be without
effect, except that the Administrator may treat such act as an election to
withdraw from the Plan. A Participant's right to purchase Shares under this Plan
may be exercisable during the Participant's lifetime only by the Participant. A
Participant's Plan Account shall be payable to the Participant's estate upon his
or her death.
SECTION 16 - ADJUSTMENT OF AND CHANGES IN SHARES
If at any time after the effective date of the Plan the Company shall
subdivide or reclassify the Shares which have been or may be optioned under the
Plan, or shall declare thereon any stock split or dividend payable in Shares, or
shall alter the capital structure of the Shares or the Company in any similar
manner, then the number and class of shares held in the Plan and which may
thereafter be optioned (in the aggregate and to any Participant) shall be
adjusted accordingly, and in the case of each option outstanding at the time of
any such action, the number and class of shares which may thereafter be
purchased pursuant to such option and the Purchase Price shall be adjusted
accordingly, as necessary to preserve the rights of the holder(s) of such Shares
and option(s).
SECTION 17 - AMENDMENT OR TERMINATION OF THE PLAN
The Board shall have the right, at any time, to amend, modify or terminate
the Plan without notice; provided, however, that no Participant's existing
options shall be adversely affected by any such amendment, modification or
termination, except to comply with applicable law, stock exchange rules or
accounting rules. Notwithstanding the foregoing, the Board shall have the right
to terminate the Plan with respect to all future payroll deductions and related
purchases at any time. Such termination of the Plan shall also terminate any
current Offering Period in accordance with Section 4 of the Plan.
Designations of participating corporations may be made from time to time
from among a group of corporations consisting of the Employer, its parent and
its Subsidiaries (including corporations that become Subsidiaries or a parent
after the adoption and approval of the Plan).
9
SECTION 18 - ADMINISTRATION
a. ADMINISTRATION. The Plan shall be administered by the Administrator.
The Administrator shall be responsible for the administration of all matters
under the Plan which have not been delegated to the Agent. The Administrator
shall have full and exclusive discretionary authority to construe, interpret and
apply the terms of the Plan, to determine eligibility and to adjudicate all
disputed claims filed under the Plan. Any rule or regulation adopted by the
Administrator shall remain in full force and effect unless and until altered,
amended or repealed by the Administrator.
b. SPECIFIC RESPONSIBILITIES. The Administrator's responsibilities shall
include, but shall not be limited to:
(1) interpreting the Plan (including issues relating to the
definition and application of "Compensation");
(2) identifying and compiling a list of persons who are Eligible
Employees for an Offering Period; and
(3) identifying those Eligible Employees not entitled to be granted
options or other rights for an Offering Period on account of the
limitations described in Section 3 b. hereof.
The Administrator may from time to time adopt rules and regulations for
carrying out the terms of the Plan. Interpretation or construction of any
provision of the Plan by the Administrator shall be final and conclusive on all
persons, absent specific and contrary action taken by the Board. Any
interpretation or construction of any provision of the Plan by the Board shall
be final and conclusive.
SECTION 19 - SECURITIES LAW RESTRICTIONS
Notwithstanding any provision of the Plan to the contrary, no payroll
deductions shall take place and no Shares may be purchased under the Plan until
a registration statement has been filed and become effective with respect to the
issuance of the Shares covered by the Plan under the Act. Prior to the
effectiveness of such registration statement, Shares subject to purchase under
the Plan may be offered to Eligible Employees only pursuant to an exemption from
the registration requirements of the Act.
SECTION 20 - NO INDEPENDENT EMPLOYEE'S RIGHTS
Nothing in the Plan shall be construed to be a contract of employment
between an Employer or Subsidiary and any Employee, or any group or category of
Employees (whether for a definite or specific duration or otherwise), or to
prevent the Employer, its parent or any Subsidiary from terminating any
Employee's employment at any time, without notice or recompense. No Employee
shall have any rights as a shareholder until the option to purchase Shares,
granted to him or her hereunder, has been exercised.
10
SECTION 21 - APPLICABLE LAW
The Plan shall be construed, administered and governed in all respects
under the laws of the State of Ohio to the extent such laws are not preempted or
controlled by federal law.
SECTION 22 - MERGER OR CONSOLIDATION
If the Company shall at any time merge into or consolidate with another
corporation or business entity, each Participant will thereafter be entitled to
receive at the end of the Offering Period (during which such merger or
consolidation occurs) the securities or property which a holder of Shares was
entitled to upon and at the time of such merger or consolidation. A sale of all
or substantially all of the assets of the Company shall be deemed a merger or
consolidation for the foregoing purposes.
11
FIRST AMENDMENT
TO THE
CARDINAL HEALTH EMPLOYEE STOCK PURCHASE PLAN
Background Information
A. Cardinal Health, Inc., an Ohio corporation (the "Company"), maintains
an employee stock purchase plan known as the Cardinal Health, Inc. Employee
Stock Purchase Plan (the "Plan") for the benefit of its eligible employees.
B. Pursuant to Section 17 of the Plan, the Company may amend the Plan by
action of its Board of Directors, which authority has been delegated by the
Board of Directors to the Benefits Policy Committee of the Company.
C. The Cardinal Health Benefits Policy Committee (the "Committee") is
empowered to amend the Plan on behalf of the Company by action of a majority of
its members then in office and, at its February 19, 2004 meeting, authorized the
amendments set forth herein.
D. The undersigned has been duly authorized to execute this amendment on
behalf of the Benefits Policy Committee in order to correctly reflect a number
of technical issues relative to the operation of the Plan, none of which,
individually or collectively, is significant enough to warrant or require
approval of the shareholders of the Company under Treasury Regulations issued
under Internal Revenue Code Section 423.
Amendment to the Plan
Effective as of January 1, 2004, the Cardinal Health, Inc. Employee Stock
Purchase Plan is amended in the following respects:
1. Section 2.k is hereby revised to read as follows: "Employee" means any
person who performs services as a common law employee of an Employer, and does
not include individuals providing services to an Employer in a capacity as an
independent contractor.
2. Section 2.s is hereby amended by deleting "or the earliest date
thereafter as is administratively feasible" in the two places it appears in such
section.
3. Section 3.b is hereby amended by moving "if" from in front of (1) to
immediately after (1).
4. Section 3.b(2) is hereby amended by inserting "to the extent that"
immediately after (2) and deleting "and can be first exercised hereunder" from
such clause.
5. In all other respects, the Plan shall remain in full force and effect.
Date: April 24, 2004 CARDINAL HEALTH, INC.
By: /s/ Sue Nelson
---------------------------------
Its: Vice President, Benefits
SECOND AMENDMENT
TO THE
CARDINAL HEALTH EMPLOYEE STOCK PURCHASE PLAN
Background Information
A. Cardinal Health, Inc., an Ohio corporation (the "Company"), maintains
an employee stock purchase plan known as the Cardinal Health, Inc. Employee
Stock Purchase Plan (the "Plan") for the benefit of its eligible employees.
B. Pursuant to Section 17 of the Plan, the Company may amend the Plan by
action of its Board of Directors, which authority has been delegated by the
Board of Directors to the Financial Benefit Plans Committee of the Company.
C. The Cardinal Health Financial Benefit Plans Committee (the "Committee")
is empowered to amend the Plan on behalf of the Company by action of a majority
of its members then in office and, at its February 24, 2005 meeting, authorized
the amendments set forth herein and the execution of these amendments by the
undersigned.
Amendment to the Plan
Effective as of February 24, 2005, the Cardinal Health, Inc. Employee
Stock Purchase Plan is amended in the following respects:
1. Section 10.a is hereby revised to read as follows: "Reinvestment of
Dividends. Cash dividends and other cash distributions received by the Agent on
Shares held in its custody hereunder will be credited to the Plan Accounts of
individual Participants in accordance with such Participants' interests in the
Shares with respect to which such dividends or distributions are paid or made.
Cash dividends will be applied, as soon as practicable after the receipt thereof
by the Agent, in accordance with the directions of the individual Participant to
whose Plan Account such amounts have been credited. Participants may, but are
not required to, direct that such cash dividends be applied to the purchase in
the open market at prevailing market prices of the number of whole Shares
capable of being purchased with such funds (or the portion of such funds
designated for such application by the Participant), after deduction of any bank
service fees, brokerage charges, transfer taxes, and any other transaction fee,
expense or cost payable in connection with the purchase of such Shares and not
otherwise paid by the Employer."
2. In all other respects, the Plan shall remain in full force and effect.
Date: February 24, 2005 CARDINAL HEALTH, INC.
By: /s/ Susan Nelson
----------------------------------
Its: Vice President, Compensation and
Benefits, Secretary BPC