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EXHIBIT (4) (c)
SUDBURY, INC.
1995 STOCK OPTION PLAN
1. PURPOSE OF THE PLAN. The purpose of this 1995 Stock Option Plan (the
"Plan") adopted as of the 22nd day of June, 1995 is to advance the interests of
Sudbury, Inc. (the "Company") and its stockholders by allowing the Company to
provide to certain present and future key employees of the Company and its
subsidiaries an incentive to acquire shares of the $.01 par value common stock
(the "Shares") of the Company on reasonable terms, thereby securing for the
Company the benefits inherent in such Share ownership. Additionally, the Plan
was designed to accord the Compensation Committee of the Company flexibility to
grant key employees either Incentive Stock Options (as defined in Section
422(b) of the Internal Revenue Code of 1986, as amended (the "Code"), or
options which do not qualify as Incentive Stock Options (such options being
hereinafter referred to as "Non-Qualified Stock Options").
2. STOCK SUBJECT TO THE PLAN. The aggregate number of Shares of the
Company for which options may be granted under the Plan shall be 1,000,000 (One
Million). Shares issued pursuant to an exercise of options under the Plan
shall be made available from either authorized but unissued or reacquired
Shares of the Company. If an option shall expire or terminate for any reason
without being exercised in full, then the Shares as to which such option was
not exercised shall become available for other options to be granted under the
Plan.
3. ADJUSTMENT. The number of Shares subject to the Plan and to options
granted under the Plan shall be adjusted as follows: (a) in the event that all
of the outstanding Shares are changed by any stock dividend, stock split or
recapitalization or in the event that extraordinary cash or non-cash dividends
are declared with respect to the Shares, the number of Shares subject to the
Plan and to options granted hereunder shall be equitably adjusted; (b) except
as otherwise provided in Section 7.1 hereof, in the event of any merger,
consolidation or reorganization of the Company with any other corporation or
corporations, there shall be substituted, on an equitable basis as determined
by the Committee, for each Share then subject to the Plan, whether or not at
the time subject to outstanding options, the number and kind of Shares or other
securities to which the holders of Shares of the Company will be entitled
pursuant to the transaction; and (c) except as otherwise provided in Section
7.2 hereof, in the event of any other relevant change in the capitalization of
the Company, the Committee shall provide for an equitable adjustment in the
number of Shares then subject to the Plan, whether or not then subject to
outstanding options. In the event of any such adjustment the purchase price
per Share shall be equitably adjusted. Any such adjustment or substitution may
provide for the elimination of any fractional Share which might otherwise
become subject to an option. The adjustment and manner of application of the
foregoing provisions shall be determined by the Committee in its sole
discretion.
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4. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the
Compensation Committee, appointed by the Board of Directors and consisting of
not less than two outside directors as defined under Section 162(m) of the Code
(the "Committee") who shall be "disinterested persons" (as defined in Rule
16b-3 of the Securities Exchange Act of 1934, as amended (("Exchange Act")).
Except as otherwise provided in Section 16 of the Exchange Act or Rule 16b-3
thereof, the members of the Committee shall not be eligible, to participate in
the Plan or any other plan of the Company or of any affiliate (as defined under
the Exchange Act) of the Company entitling the participants therein to acquire
stock, stock options, or stock appreciation rights of the Company or an
affiliate thereof so long as they remain a member of the Committee. Subject to
the express provisions of the Plan, the Committee shall have authority to
determine among the full-time employees of the Company, its subsidiaries or a
subsidiary of its subsidiaries to whom options shall be granted. For these
purposes, a subsidiary shall be deemed to include any company as to which the
Company owns and/or controls 50% of the outstanding voting equity securities.
The Committee shall also have authority to determine the number of shares to be
covered by each option grant and the terms of any such option grant; to amend
or cancel options; to accelerate vesting of options; to require the
cancellation or surrender of any previously granted options or other awards
under the Plan or any other plans of the Company as a condition to the granting
of an option; to construe and interpret the Plan and any option agreement
entered into thereunder; to establish, amend, and rescind rules and regulations
for administration of the Plan; and shall have such additional authority as the
Board of Directors from time to time may determine to be necessary or
desirable.
5. BASIC OPTION TERMS:
5.1 TYPES OF OPTIONS. Options granted under the Plan may be (a)
Incentive Stock Options or (b) Non-Qualified Stock Options. Option
agreements reflecting the grant of options shall designate whether an
option is an Incentive Stock Option or a Non-Qualified Stock Option.
In the case of a grant intended to qualify as an Incentive Stock
Option under Section 422 of the Code, no such option shall be granted
hereunder to any person who, immediately after such option is granted,
owns (as defined in Sections 422 and 424 of the Code) stock possessing
more than 10% of the total combined voting power or value of all
classes of stock of the Company or its subsidiary corporations. The
aggregate fair market value (determined on the date of grant) of the
Shares with respect to which Incentive Stock Options are exercisable
for the first time by any individual during any calendar year (under
this Plan or any other plan of the Company and any subsidiary
corporation that provides for the granting of incentive stock options)
shall not exceed $100,000.
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The maximum aggregate number of Shares underlying options that may be
granted to any employee under the Plan during any calendar year is
250,000.
5.2 OPTION PERIOD. An option grant under the Plan shall expire on
a date fixed by the Committee which shall be not later than ten years
after the date on which the option is so granted.
5.3 OPTION PRICE. The option price shall be not less than the per
share fair market value of the outstanding Shares of the Company on
the date the option is granted, and not less than the par value of the
Shares as to which the option is granted. The date on which the
Committee approves the granting of an option shall be deemed the date
on which the option is granted. The purchase price of the Shares as
to which an option is exercised shall be payable in full at the time
of exercise either (a) in cash (including check, bank draft, wire
transfer or money order), (b) by delivering, in transferable form,
that number of Shares which, on the business day preceding the date of
exercise, has an aggregate fair market value equal to such purchase
price, or (c) a combination of the foregoing. The fair market value
of the Shares shall be deemed to be (a) the closing price of the
Shares on the principal stock exchange on which the Shares are then
traded on the last business day preceding the date of exercise of the
option, or (b) if no sales take place on such day on any such
exchange, the average of the last reported closing bid and asked
prices on such day as officially quoted on the principal stock
exchange on which the Shares are then traded, or (c) if the Shares are
not listed on any such exchange, the average of the last reported
closing bid and asked prices on the over-the-counter market on the day
preceding the date of exercise of the option. The Nasdaq Stock Market
shall be deemed a principal stock exchange.
5.4 NON-TRANSFERABILITY. Options shall not be transferable other
than by will or the laws of descent and distribution or pursuant to a
qualified domestic relation order as defined by the Code or Title I of
the Employee Retirement Income Security Act of 1974, as amended, or
the rules thereunder; provided that an Incentive Stock Option may not
be transferred pursuant to a qualified domestic relations order unless
the transfer is otherwise permitted pursuant to the Code without
affecting the option's qualification as an Incentive Stock Option.
Options shall not be exercisable except by the optionee during his
lifetime either directly or through his guardian or legal
representative.
All actions of the Committee under this Section 5 shall be binding and
conclusive on the Company, on optionees under the Plan, and on
employees eligible to receive options under the Plan.
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6. OPTION AGREEMENT. Each grant of an option under the Plan shall be
evidenced by an option agreement in a form approved by the Committee, which
option agreement shall set forth the option price, the option period, and such
additional terms and conditions as the Committee may prescribe. The option
agreement shall be signed on behalf of the Company by the Chairman, the
President, or a Vice President of the Company, other than the employee who is a
party to the agreement, and shall be dated as of the date of the granting of
the option, as determined by Paragraph 5.3 above.
7. CHANGE OF CONTROL:
7.1 If the Company shall liquidate or dissolve, or shall be a
party to a merger, consolidation or other business combination with
respect to which it shall not be the surviving corporation, the
Company shall give written notice thereof to the holders of options
not previously exercised at least thirty days prior thereof, and the
optionee shall have the right within said thirty-day period to
exercise all options in full to the extent not previously exercised.
To the extent that an option shall not have been exercised on or prior
to the effective date of such liquidation, dissolution, merger or
consolidation or business combination, it shall terminate on said
date, unless it is assumed by another corporation.
7.2 Options granted under the Plan shall become exercisable in
full if and when any corporation, partnership, joint venture, person
or a group acting together ("Acquiring Entity") for a similar purpose
shall directly or indirectly acquire or announce an intent to directly
or indirectly acquire control of the Company or any successor or
assignee of the Company. For purposes of this Section 7, control
shall mean the acquisition of, or the formation of a group whose
members beneficially own Shares, which after giving effect thereto,
shall permit the Acquiring Entity to vote 45% or more of the aggregate
voting power, as measured by all Shares then outstanding, in the
election of directors of the Company.
8. AMENDMENT AND TERMINATION OF THE PLAN. The Company, by action of its
Board of Directors or stockholders, may amend, modify, suspend, or terminate
the Plan at any time; provided, however, that no action by the Board of
Directors or stockholders may (a) impair an optionee's rights under any
outstanding option without such optionee's consent, (b) increase the total
number of shares as to which options may be granted (except increases
attributable to the adjustments authorized by Paragraph 3 hereof), (c) reduce
the price at which options may be granted, or (d) extend the expiration date of
the Plan. No action may be taken by the Company (without the consent of the
optionee) which will prevent the Incentive Stock Options issued under this Plan
from being "Incentive Stock Options" under Section 422 of the Code.
Moreover, no amendment without the approval of stockholders of the Company
shall be made if stockholder approval under Section 422 of the Code or Rule
16b-3 of the Exchange Act would be required.
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9. GOVERNANCE BY RULE 16B-3. The Plan is intended to comply with the
provisions of 16b-3 promulgated under the Exchange Act and shall be interpreted
in a manner consistent therewith.
10. EXPIRATION OF THE PLAN. Options may be granted under the Plan at any
time through June 22, 2005, on which date the Plan shall expire unless sooner
terminated by stockholder vote. No Plan termination shall affect any options
then outstanding.
11. GENERAL PROVISIONS. The Company may establish procedures whereby an
optionee subject to the requirements of Rule 16b-3, Regulation T, of the Code,
and other federal, state and local tax and securities laws, may exercise an
option without making a direct payment of the option price to the Company;
provided, however, that these cashless exercise procedures shall not apply to
Incentive Stock Options which are outstanding on the date the Company
establishes such procedures unless the application of such procedures to such
options is permitted pursuant to the Code and the regulations thereunder,
without affecting the options' qualification under Code Section 422 as
Incentive Stock Options. If the Company elects to establish a cashless
exercise program the Company shall determine administrative procedures and
policies it deems appropriate and these procedures and policies shall be
binding on any optionee wishing to use the cashless exercise program.
Nothing contained in the Plan or in any option granted pursuant thereto shall
confer upon any optionee any right to continue in the employ of the Company or
any subsidiary of the Company, or limit or restrict any right of the Company or
its subsidiaries to terminate the employment of the optionee at any time.
No optionee shall have any of the rights of a stockholder with respect to any
Shares subject to an option grant until certificates representing those Shares
have been issued to the optionee.
At the time of the exercise of any option, the Company may require, as a
condition of the exercise of such option, the optionee to pay the Company an
amount equal to the amount of tax the Company may be required to withhold with
respect to the Shares.
The Plan shall be governed by and construed in accordance with the laws of the
State of Delaware.
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12. EFFECTIVENESS OF THE PLAN. The Plan shall be approved by the Board.
The Plan shall thereafter be submitted to the Company's stockholders for
approval and unless the Plan is approved by the affirmative votes of the
holders of shares having a majority of the voting power of all shares
represented at a meeting duly held in accordance with Delaware law within
twelve (12) months after being approved by the Board, the Plan and all options
granted under it shall be void and of no force and effect. The Plan shall
become effective on June 22, 1995 at which time the Company's 1990 Stock Option
Plan will terminate.
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JULY 27, 1995
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FORM OF EXERCISE OF OPTION
Granted Under the Sudbury, Inc.
1995 Stock Option Plan
Date:
Sudbury, Inc.
30100 Chagrin Blvd.
Suite 203
Pepper Pike, OH 44124
Attention: Secretary
Referring to the Stock Option Agreement dated as of _____________,
____, between Sudbury, Inc. (the "Company") and the undersigned, granting to me
the right to purchase a remainder of _________ shares of Common Stock of the
Company at $____per share, I hereby exercise my right to purchase pursuant to
said Agreement __________ shares of such Common Stock.
In payment of the aggregate purchase price of $ ________, I have
enclosed herewith a check, bank draft or money order in the amount of $
_______, and/or (if shares of Common Stock of the Company are being used in
partial or full payment of the purchase price) the following certificates for
shares of Common Stock.*
Certificate Nos. Shares Certificate Nos. Shares
________________ ______ ________________ ______
________________ ______ ________________ ______
________________ ______ ________________ ______
_______________________________________________________
* When this Exercise of Option is signed by the sole registered owner of
the certificate(s) listed and transmitted hereby, no endorsement of
the certificate(s) or separate stock powers is required. If this Form
of Exercise of Option is signed by a person other than the registered
owner of the certificate(s) listed, or if the certificate(s)
transmitted hereby is/are owned by two or more joint owners, such
certificate(s) must be endorsed or accompanied by appropriate stock
powers.
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The stock certificate(s) representing the shares purchased as
aforesaid, together with such additional shares, if any, as may be required to
adjust for stock splits or stock dividends subsequent to the date of the
option, and shares, if any, represented by a certificate tendered herewith in
excess of the number of shares required for payment of the purchase price,
should be issued and delivered to me as follows:
__________ By delivery to me in person at the above office of the
Company
__________ By mailing the same to me at the address shown below
my signature hereto
I understand that this exercise of stock option is subject to federal,
state, and local withholding requirements and I will comply, prior to the
issuance of the shares hereunder, with whatever arrangements the Company deems
necessary.
Please issue the stock certificate(s) in the following denominations:
________________________________
________________________________
Very truly yours,
________________________________________
{Employee's Signature}
Address:________________________________
________________________________________
Social Security No.:____________________
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