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EXHIBIT 99(b)
OWEN HEALTHCARE, INC.
1992 STOCK OPTION PLAN
I. PURPOSE OF THE PLAN
The OWEN HEALTHCARE, INC. 1992 STOCK OPTION PLAN (the "PLAN") is intended
to provide a means whereby certain employees of OWEN HEALTHCARE, INC., a Texas
corporation (the "COMPANY"), and its subsidiaries may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company, thereby advancing the interests of the
Company and its shareholders. Accordingly, the Company may grant to certain
employees ("OPTIONEES") the option ("OPTION") to purchase shares of the common
stock of the Company ("STOCK"), as hereinafter set forth. Options granted under
the Plan may be either incentive stock options ("INCENTIVE STOCK OPTIONS"),
within the meaning of section 422(b) of the Internal Revenue Code of 1986, as
amended (the "CODE"), or options which do not constitute Incentive Stock
Options.
II. ADMINISTRATION
The Plan shall be administered by a committee (the "COMMITTEE") which shall
be appointed by the Board of Directors of the Company (the "BOARD"); provided,
however, that if and when the Company becomes subject to Section 16 of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), then, from and
after such time the Committee shall be constituted so as to permit the Plan to
comply with Rule 16b-3, as then in effect or as thereafter modified or amended
("RULE 16b-3"), promulgated under the 1934 Act. The Committee shall have sole
authority to select the Optionees from among those individuals eligible
hereunder and to establish the number of shares which may be issued under each
Option. In making such determination, the Committee may take into account the
nature of the services rendered by such individuals, their present and potential
contributions to the Company's success and such other factors as the Committee
in its discretion shall deem relevant. The Committee is authorized to interpret
the Plan and may from time to time adopt such rules and regulations, consistent
with the provisions of the Plan, as it may deem advisable to carry out the Plan.
All decisions made by the Committee in selecting the Optionees, in establishing
the number of shares which may be issued under each Option and in construing the
provisions of the Plan shall be final.
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III. OPTION AGREEMENTS
(a) Each Option shall be evidenced by a written agreement between the
Company and the Optionee ("OPTION AGREEMENT") which shall contain such terms and
conditions as may be approved by the Committee. The terms and conditions of the
respective Option Agreements need not be identical. Specifically, an Option
Agreement may provide for the surrender of the right to purchase shares under
the Option in return for a payment in cash or shares of Stock or a combination
of cash and shares of Stock equal in value to the excess of the fair market
value of the shares with respect to which the right to purchase is surrendered
over the option price therefor ("STOCK APPRECIATION RIGHTS"), on such terms and
conditions as the Committee in its sole discretion may prescribe; provided,
that, from and after the time the Company becomes subject to Section 16 of the
1934 Act, with respect to Stock Appreciation Rights granted to employees who are
subject to Section 16 of the 1934 Act, except as provided in Subparagraph
VIII(c) hereof, the Committee shall retain final authority (i) to determine
whether an Optionee shall be permitted, or (ii) to approve an election by an
Optionee, to receive cash in full or partial settlement of Stock Appreciation
Rights. Moreover, an Option Agreement may provide for the payment of the option
price, in whole or in part, by the delivery of a number of shares of Stock (plus
cash if necessary) having a fair market value equal to such option price.
(b) For all purposes under the Plan, the fair market value of a share of
Stock on a particular date shall be equal to the mean of the reported high and
low sales prices of the Stock on the stock exchange composite tape on that date,
or if no prices are reported on that date, on the last preceding date on which
such prices of the Stock are so reported. If the Stock is traded over the
counter at the time a determination of its fair market value is required to be
made hereunder, its fair market value shall be deemed to be equal to the average
between the reported high and low or closing bid and asked prices of Stock on
the most recent date on which Stock was publicly traded. In the event Stock is
not publicly traded at the time a determination of its value is required to be
made hereunder, the determination of its fair market value shall be made by the
Committee in such manner as it deems appropriate.
(c) Each Option and all rights granted thereunder shall not be transferable
other than by will or the laws of descent and distribution, and shall be
exercisable during the Optionee's lifetime only by the Optionee or the
Optionee's guardian or legal representative.
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IV. ELIGIBILITY OF OPTIONEE
Options may be granted only to individuals who are employees (including
officers and directors who are also employees) of the Company or any parent or
subsidiary corporation (as defined in section 424 of the Code) of the Company at
the time the Option is granted; provided, however, that, from and after the time
the Company becomes subject to Section 16 of the 1934 Act, members of the
Committee shall not be eligible to be granted Options. Options may be granted to
the same individual on more than one occasion. No Incentive Stock Option shall
be granted to an individual if, at the time the Option is granted, such
individual owns stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or of its parent or subsidiary
corporation, within the meaning of section 422(b)(6) of the Code, unless (i) at
the time such Option is granted the option price is at least 110% of the fair
market value of the Stock subject to the Option and (ii) such Option by its
terms is not exercisable after the expiration of five years from the date of
grant. To the extent that the aggregate fair market value (determined at the
time the respective Incentive Stock Option is granted) of stock with respect to
which Incentive Stock Options are exercisable for the first time by an
individual during any calendar year under all incentive stock option plans of
the Company and its parent and subsidiary corporations exceeds $100,000, such
excess Incentive Stock Options shall be treated as Options which do not
constitute Incentive Stock Options. The Committee shall determine, in accordance
with applicable provisions of the Code, Treasury Regulations and other
administrative pronouncements, which of an Optionee's Incentive Stock Options
will not constitute Incentive Stock Options because of such limitation and shall
notify the Optionee of such determination as soon as practicable after such
determination.
V. SHARES SUBJECT TO THE PLAN
The aggregate number of shares which may be issued under Options granted
under the Plan shall not exceed 200,000 shares of Stock. Such shares may
consist of authorized but unissued shares of Stock or previously issued shares
of Stock reacquired by the Company. Any of such shares which remain unissued and
which are not subject to outstanding Options at the termination of the Plan
shall cease to be subject to the Plan, but, until termination of the Plan, the
Company shall at all times make available a sufficient number of shares to meet
the requirements of the Plan. Should any Option hereunder expire or terminate
prior to its exercise in full, the shares theretofore subject to such Option may
again be subject to an Option granted under the Plan (but only to the extent
permitted under Rule 16b-3 with respect to shares subject to an Option which
expires or terminates on or after the time the Company becomes subject to
Section 16 of the 1934 Act). The aggregate number of shares which may be issued
under the Plan shall be subject to adjustment in the same manner as provided in
Paragraph VIII hereof with respect to shares of Stock subject to Options then
outstanding. Exercise of an Option in
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any manner, including an exercise involving a Stock Appreciation Right, shall
result in a decrease in the number of shares of Stock which may thereafter be
available, both for purposes of the Plan and for sale to any one individual, by
the number of shares as to which the Option is exercised. Separate stock
certificates shall be issued by the Company for those shares acquired pursuant
to the exercise of an Incentive Stock Option and for those shares acquired
pursuant to the exercise of any Option which does not constitute an Incentive
Stock Option.
VI. OPTION PRICE
The purchase price of Stock issued under each Option shall be determined
by the Committee, but (i) in the case of an Incentive Stock Option, such
purchase price shall not be less than the fair market value of Stock subject to
the Option on the date the Option is granted, and (ii) in the case of an option
that does not constitute an Incentive Stock Option, such purchase price shall
not be less than 80% of the fair market value of Stock subject to the Option on
the date the Option is granted.
VII. TERM OF PLAN
The Plan shall be effective upon the date of its adoption by the Board,
provided the Plan is approved by the shareholders of the Company within twelve
months thereafter. Except with respect to Options then outstanding, if not
sooner terminated under the provisions of Paragraph IX, the Plan shall terminate
upon and no further Options shall be granted after the expiration of ten years
from the date of its adoption by the Board.
VIII. RECAPITALIZATION OR REORGANIZATION
(a) The existence of the Plan and the Options granted hereunder shall not
affect in any way the right or power of the Board or the shareholders of the
Company to make or authorize any adjustment, recapitalization, reorganization
or other change in the Company's capital structure or its business, any merger
or consolidation of the Company, any issue of debt or equity securities, the
dissolution or liquidation of the Company or any sale, lease, exchange or other
disposition of all or any part of its assets or business or any other corporate
act or proceeding.
(b) The shares with respect to which Options may be granted are shares of
Stock as presently constituted, but if, and whenever, prior to the expiration
of an Option theretofore granted, the Company shall effect a subdivision or
consolidation of shares of Stock or the payment of a stock dividend on Stock
without receipt of consideration by the Company, the number of shares of Stock
with respect to which such Option may thereafter be exercised (i) in the event
of an increase in the number of outstanding shares shall be proportionately
increased, and the purchase price per share shall be proportionately
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reduced, and (ii) in the event of a reduction in the number of outstanding
shares shall be proportionately reduced, and the purchase price per share shall
be proportionately increased.
(c) If the Company recapitalizes or otherwise changes its capital
structure, thereafter upon any exercise of an Option theretofore granted the
Optionee shall be entitled to purchase under such Option, in lieu of the number
and class of shares of Stock then covered by such Option, the number and class
of shares of stock and securities to which the Optionee would have been
entitled pursuant to the terms of the recapitalization if, immediately prior to
such recapitalization, the Optionee had been the holder of record of the number
of shares of Stock then covered by such Option. If (i) the Company shall not be
the surviving entity in any merger, consolidation or other reorganization (or
survives only as a subsidiary of an entity other than a previously wholly-owned
subsidiary of the Company), (ii) the Company sells, leases or exchanges or
agrees to sell, lease or exchange all or substantially all of its assets to any
other person or entity (other than a wholly-owned subsidiary of the Company),
(iii) the Company is to be dissolved and liquidated, (iv) any person or entity,
including a "group" as contemplated by Section 13(d)(3) of the 1934 Act, except
an underwriter or similar entity in connection with a public offering of Stock,
acquires or gains ownership or control (including, without limitation, power to
vote) of more than 50% of the outstanding shares of Stock, or (v) as a result
of or in connection with a contested election of directors, the persons who
were directors of the Company before such election shall cease to constitute a
majority of the Board (each such event is referred to herein as a "CORPORATE
CHANGE"), then effective as of a date (selected by the Committee) within (a)
ten days after the approval by the shareholders of the Company of such merger,
consolidation, reorganization, sale, lease or exchange of assets or dissolution
or such election of directors or (b) thirty days of such change of control, the
Committee, acting in its sole discretion without the consent or approval of any
Optionee, shall effect one or more of the following alternatives, which may
vary among individual Optionees: (1) accelerate the time at which Options then
outstanding may be exercised so that such Options may be exercised in full for
a limited period of time on or before a specified date (before or after such
Corporate Change) fixed by the Committee, after which specified date all
unexercised Options and all rights of Optionees thereunder shall terminate, (2)
require the mandatory surrender to the Company by selected Optionees of some or
all of the outstanding Options held by such Optionees (irrespective of whether
such Options are then exercisable under the provisions of the Plan) as of a
date, before or after such Corporate Change, specified by the Committee, in
which event the Committee shall thereupon cancel such Options and pay to each
Optionee an amount of cash per share equal to the excess of the amount
calculated in Subparagraph (d) below (the "CHANGE OF CONTROL VALUE") of the
shares subject to such Option over the exercise price(s) under such Options for
such shares, (3) make such adjustments to Options then outstanding as the
Committee deems appropriate to reflect such Corporate Change (provided,
however, that the Committee may determine in its sole discretion that no
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adjustment is necessary to Options then outstanding) or (4) provide that
thereafter upon any exercise of an Option theretofore granted the Optionee
shall be entitled to purchase under such Option, in lieu of the number of
shares of Stock as to which such Option shall then be exercisable, the number
and class of shares of stock or other securities or property to which the
Optionee would have been entitled pursuant to the terms of the agreement of
merger, consolidation or sale of assets and dissolution if, immediately prior
to such merger, consolidation or sale of assets and dissolution the Optionee
had been the holder of record of the number of shares of Stock as to which such
Option is then exercisable.
(d) For the purposes of clause (2) in Subparagraph (c) above, the "CHANGE
OF CONTROL VALUE" shall equal the amount determined in clause (i), (ii) or
(iii), whichever is applicable, as follows: (i) the per share price offered to
shareholders of the Company in any such merger, consolidation, reorganization,
sale of assets or dissolution transaction, (ii) the price per share offered to
shareholders of the Company in any tender offer or exchange offer whereby a
Corporate Change takes place, or (iii) if such Corporate Change occurs other
than pursuant to a tender or exchange offer, the fair market value per share of
the shares into which such Options being surrendered are exercisable, as
determined by the Committee as of the date determined by the Committee to be the
date of cancellation and surrender of such Options. In the event that the
consideration offered to shareholders of the Company in any transaction
described in this Subparagraph (d) or Subparagraph (c) above consists of
anything other than cash, the Committee shall determine the fair cash equivalent
of the portion of the consideration offered which is other than cash.
(e) Any adjustment provided for in Subparagraphs (b) or (c) above shall be
subject to any required shareholder action.
(f) Except as hereinbefore expressly provided, the issuance by the Company
of shares of stock of any class or securities convertible into shares of stock
of any class, for cash, property, labor or services, upon direct sale, upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, and in any case whether or not for fair value, shall not affect,
and no adjustment by reason thereof shall be made with respect to, the number
of shares of Stock subject to Options theretofore granted or the purchase price
per share.
IX. AMENDMENT OR TERMINATION OF THE PLAN
The Board in its discretion may terminate the Plan at any time with
respect to any shares for which Options have not theretofore been granted. The
Board shall have the right to alter or amend the Plan or any part thereof from
time to time; provided, that no change in any Option theretofore granted may be
made which would impair the rights of
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the Optionee without the consent of such Optionee; and provided, further, that
(i) the Board may not make any alteration or amendment on or after the time the
Company becomes subject to Section 16 of the 1934 Act which would decrease any
authority granted to the Committee hereunder in contravention of Rule 16b-3 and
(ii) the Board may not make any alteration or amendment which would materially
increase the benefits accruing to participants under the Plan, increase the
aggregate number of shares which may be issued pursuant to the provisions of
the Plan, change the class of individuals eligible to receive Options under the
Plan or extend the term of the Plan, without the approval of the shareholders
of the Company.
X. SECURITIES LAW
(a) The Company shall not be obligated to issue any Stock pursuant to any
Option granted under the Plan at any time when the offering of the shares
covered by such Option have not been registered under the Securities Act of
1933 and such other state and federal laws, rules or regulations as the Company
or the Committee deems applicable and, in the opinion of legal counsel for the
Company, there is no exemption from the registration requirements of such laws,
rules or regulations available for the offering and sale of such shares.
(b) From and after the time the Company becomes subject to Section 16 of
the 1934 Act, it is intended that the Plan and any grant of an Option made to a
person subject to Section 16 of the 1934 Act meet all of the requirements of
Rule 16b-3. If any provision of the Plan or any such Option would disqualify
the Plan or such Option under, or would otherwise not comply with, Rule 16b-3,
such provision or Option shall be construed or deemed amended to conform to
Rule 16b-3.