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EXHIBIT 10(F)
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KEITHLEY INSTRUMENTS, INC.
1992 STOCK INCENTIVE PLAN
1. General. This Stock Incentive Plan (the "Plan") provides eligible
employees of Keithley Instruments, Inc. (the "Company") with the opportunity to
acquire or expand their equity interest in the Company by making available for
award or purchase Common Shares, without par value, of the Company ("Common
Shares"), through the granting of nontransferable options to purchase Common
Shares ("Stock Options"), the granting of Common Shares subject to temporal
restrictions on transfer and substantial risks of forfeiture ("Restricted
Stock"), and the granting of nontransferable options to receive payments based
on the appreciation of Common Shares ("SARs"). Stock Options, Restricted Stock
and SARs shall be collectively referred to herein as "Grants"; an individual
grant of Stock Options, Restricted Stock or SARs shall be individually referred
to herein as a "Grant". It is intended that key employees may be granted,
simultaneously or from time to time, Stock Options that qualify as incentive
stock options ("Incentive Stock Options") under Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code") or Stock Options that do not so
qualify ("Non-qualified Stock Options"). No provision of the Plan is intended or
shall be construed to grant employees alternative rights in any Incentive Stock
Option granted under the Plan so as to prevent such Option from qualifying under
Section 422 of the Code.
2. Purpose of the Plan. The purpose of the Plan is to provide
continuing incentives to key employees of the Company and of any subsidiary
corporation of the Company, by encouraging such key employees to acquire new or
additional share ownership in the Company, thereby increasing their proprietary
interest in the Company's business and enhancing their personal interest in the
Company's success.
For purposes of the Plan, a "subsidiary corporation" consists of any
corporation fifty percent (50%) of the stock of which is directly or indirectly
owned or controlled by the Company.
3. Effective Date of the Plan. The Plan shall become effective upon its
adoption by the Board of Directors, subject to approval by holders of a majority
of the outstanding shares of voting capital stock of the Company. If the Plan is
not so approved within twelve (12) months after the date the Plan is adopted by
the Board of Directors, the Plan and any Grants made hereunder shall be null and
void. However, if the Plan is so approved, no further shareholder approval shall
be required with respect to the making of Grants pursuant to the Plan, except as
provided in Section 12 hereof.
4. Administration of the Plan. The Plan shall be administered by the
Compensation and Human Resources Committee of the Board of Directors of the
Company, however described, or by any other committee selected by such Board of
Directors by majority vote and composed of no fewer than two (2) members of such
Board of Directors (the "Committee"). No person shall be appointed to the
Committee who, during the one-year period immediately preceding such person's
appointment to the Committee, has received any Grants under the Plan or any
similar stock option or stock incentive plan, other than a formula-based plan,
maintained by the Company or any subsidiary corporation. A member of the
Committee shall not be eligible to participate in this Plan while serving on the
Committee.
A majority of the Committee shall constitute a quorum. The acts of a
majority of the members present at any meeting at which a quorum is present (or
acts unanimously approved in writing by the members of the Committee) shall
constitute binding acts of the Committee.
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Subject to the terms and conditions of the Plan, the Committee shall be
authorized and empowered:
(a) To select the key employees to whom Grants may be made;
(b) To determine the number of Common Shares to be covered by any
Grant;
(c) To prescribe the terms and conditions of any Grants made under
the Plan, and the form(s) and agreement(s) used in connection
with such Grants, which shall include agreements governing the
granting of Restricted Stock, Stock Options and/or SARs;
(d) To determine the time or times when Stock Options and/or SARs
will be granted and when they will terminate in whole or in
part;
(e) To determine the time or times when Stock Options and SARs
that are granted may be exercised;
(f) To determine, at the time a Stock Option is granted under the
Plan, whether such Option is an Incentive Stock Option
entitled to the benefits of Section 422 of the Code;
(g) To establish any other Stock Option agreement provisions not
inconsistent with the terms and conditions of the Plan or,
where the Stock Option is an Incentive Stock Option, with the
terms and conditions of Section 422 of the Code; and
(h) To determine whether SARs will be made part of any Grants
consisting of Stock Options, and to approve any SARs made part
of any such Grants pursuant to Section 9 hereof.
5. Employees Eligible for Grants. Grants may be made from time to time
to those key employees of the Company or a subsidiary corporation, who are
designated by the Committee in its sole and exclusive discretion. Key employees
may include, but shall not necessarily be limited to, members of the Board of
Directors (excluding members of the Committee), and officers, of the Company and
any subsidiary corporation; however, Stock Options intended to qualify as
Incentive Stock Options shall only be granted to key employees while actually
employed by the Company or a subsidiary corporation. The Committee may grant
more than one Stock Option, with or without SARs, to the same key employee. No
Stock Option shall be granted to any key employee during any period of time when
such key employee is on a leave of absence.
6. Shares Subject to the Plan. The shares to be issued pursuant to any
Grant made under the Plan shall be Common Shares. Either Common Shares held as
treasury stock, or authorized and unissued Common Shares, or both, may be so
issued, in such amount or amounts within the maximum limits of the Plan as the
Board of Directors shall from time to time determine. In the event a SAR is
granted in tandem with a Stock Option pursuant to Section 9 and such SAR is
thereafter exercised in whole or in part, then such Stock Option or the portion
thereof to which the duly exercised SAR relates shall be deemed to have been
exercised for purposes of such Option, but may be made available for reoffering
under the Plan to any eligible employee.
Subject to the provisions of the next succeeding paragraph of this
Section 6 and the provisions of Section 7(h), the aggregate number of Common
Shares that can be actually issued under the Plan (exclusive of Restricted Stock
forfeited under the Plan before the holder thereof received any
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benefits of ownership, such as dividends) shall be three hundred fifty thousand
(350,000) Common Shares.
If, at any time subsequent to the date of adoption of the Plan by the
Board of Directors, the number of Common Shares are increased or decreased, or
changed into or exchanged for a different number or kind of shares of stock or
other securities of the Company or of another corporation (whether as a result
of a stock split, stock dividend, combination or exchange of shares, exchange
for other securities, reclassification, reorganization, redesignation, merger,
consolidation, recapitalization or otherwise): (i) there shall automatically be
substituted for each Common Share subject to an unexercised Stock Option or SAR
(in whole or in part) granted under the Plan, the number and kind of shares of
stock or other securities into which each outstanding Common Share shall be
changed or for which each such Common Share shall be exchanged; (ii) the option
price per Common Share or unit of securities shall be increased or decreased
proportionately so that the aggregate purchase price for the securities subject
to a Stock Option or SAR shall remain the same as immediately prior to such
event; and (iii) any outstanding Restricted Stock that is converted, exchanged
or otherwise changed into a different number or kind of stock or security, shall
continue to be subject to any and all terms, conditions and restrictions
originally applicable to such Restricted Stock. In addition to the foregoing,
the Committee shall be entitled in the event of any such increase, decrease or
exchange of Common Shares to make other adjustments to the securities subject to
a Stock Option or SAR, the provisions of the Plan, and to any related Stock
Option or SAR agreements (including adjustments which may provide for the
elimination of fractional shares), where necessary to preserve the terms and
conditions of any Grants hereunder.
7. Stock Option Provisions.
(a) General. The Committee may grant to key employees (also referred to
as "optionees") nontransferable Stock Options that either qualify as Incentive
Stock Options under Section 422 of the Code or do not so qualify. However, any
Stock Option which is an Incentive Stock Option shall only be granted within 10
years from the earlier of (i) the date this Plan is adopted by the Board of
Directors of the Company; or (ii) the date this Plan is approved by the
shareholders of the Company.
(b) Stock Option Price. The option price per Common Share which may be
purchased under an Incentive Stock Option under the Plan shall be determined by
the Committee at the time of Grant, but shall not be less than one hundred
percent (100%) of the fair market value of a Common Share, determined as of the
date such Option is granted; however, if a key employee to whom an Incentive
Stock Option is granted is, at the time of the grant of such Option, an "owner,"
as defined in Section 422(b)(6) of the Code (modified as provided in Section
424(d) of the Code) of more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any subsidiary corporation (a
"Substantial Shareholder"), the price per Common Share of such Option, as
determined by the Committee, shall not be less than one hundred ten percent
(110%) of the fair market value of a Common Share on the date such Option is
granted. The option price per Common Share under each Stock Option granted
pursuant to the Plan which is not an Incentive Stock Option shall be determined
by the Committee at the time of Grant. Except as specifically provided above,
the fair market value of a Common Share shall be determined in accordance with
procedures to be established by the Committee. The day on which the Committee
approves the granting of a Stock Option shall be considered the date on which
such Option is granted.
(c) Period of Stock Option. The Committee shall determine when each
Stock Option is to expire. However, no Incentive Stock Option shall be
exercisable for a period of more than ten (10) years from the date upon which
such Option is granted. Further, no Incentive Stock Option granted to an
employee who is a Substantial Shareholder at the time of the grant of such
Option shall be exercisable after the expiration of (5) years from the date of
grant of such Option.
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(d) Limitation on Exercise and Transfer of Stock Options. Only the key
employee to whom a Stock Option is granted may exercise such Option, except
where a guardian or other legal representative has been duly appointed for such
employee, and except as otherwise provided in the case of such employee's death.
No Stock Option granted hereunder shall be transferable by an optionee other
than by will or the laws of descent and distribution. No Stock Option granted
hereunder may be pledged or hypothecated, nor shall any such Option be subject
to execution, attachment or similar process.
(e) Employment, Holding Period Requirements For Certain Options. The
Committee may condition any Stock Option granted hereunder upon the continued
employment of the optionee by the Company or by a subsidiary corporation, and
may make any such Stock Option immediately exercisable. However, the Committee
will require that, from and after the date of grant of any Incentive Stock
Option granted hereunder until the day three (3) months prior to the date such
Option is exercised, such optionee must be an employee of the Company or of a
subsidiary corporation, but always subject to the right of the Company or any
such subsidiary corporation to terminate such optionee's employment during such
period. Each Stock Option shall be subject to such additional restrictions as to
the time and method of exercise as shall be prescribed by the Committee. Upon
completion of such requirements, if any, a Stock Option or the appropriate
portion thereof may be exercised in whole or in part from time to time during
the option period; however, such exercise right(s) shall be limited to whole
shares.
(f) Payment for Stock Option Price. A Stock Option shall be exercised
by an optionee giving written notice to the Company of his intention to exercise
the same, accompanied by full payment of the purchase price in cash or by check,
or, with the consent of the Committee, in whole or in part with a surrender of
Common Shares having a fair market value on the date of exercise equal to that
portion of the purchase price for which payment in cash or check is not made.
The Committee may, in its sole discretion, approve other methods of exercise for
a Stock Option or payment of the option price, provided that no such method
shall cause any option granted under the Plan as an Incentive Stock Option to
not qualify under Section 422 of the Code, or cause any Common Share issued in
connection with the exercise of an option not to be a fully paid and
non-assessable Common Share.
(g) Certain Reissuances of Stock Options. To the extent Common Shares
are surrendered by an optionee in connection with the exercise of a Stock Option
in accordance with Section 7(f), the Committee may in its sole discretion grant
new Stock Options to such optionee (to the extent Common Shares remain available
for Grants), subject to the following terms and conditions:
(i) The number of Common Shares shall be equal to the number of Common
Shares being surrendered by the optionee;
(ii) The option price per Common Share shall be equal to the fair
market value of Common Shares, determined on the date of exercise of
the Stock Options whose exercise caused such Grant; and
(iii) The terms and conditions of such Stock Options shall in all other
respects replicate such terms and conditions of the Stock Options whose
exercise caused such Grant, except to the extent such terms and
conditions are determined to not be wholly consistent with the general
provisions of this Section 7, or in conflict with the remaining
provisions of this Plan.
(h) Cancellation and Replacement of Stock Options and Related Rights.
The Committee may at any time or from time to time permit the voluntary
surrender by an optionee who is the holder of any outstanding Stock Options
under the Plan, where such surrender is conditioned upon the
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granting to such optionee of new Stock Options for such number of shares as the
Committee shall determine, or may require such a voluntary surrender as a
condition precedent to the grant of new Stock Options. The Committee shall
determine the terms and conditions of new Stock Options, including the prices at
and periods during which they may be exercised, in accordance with the
provisions of this Plan, all or any of which may differ from the terms and
conditions of the Stock Options surrendered. Any such new Stock Options shall be
subject to all the relevant provisions of this Plan. The Common Shares subject
to any Stock Option so surrendered, and/or any Common Shares subject to any
Stock Option that has lapsed, been forfeited, or been cancelled and extinguished
in connection with the exercise of an SAR, shall no longer be charged against
the limitation provided in Section 6 of this Plan and may again become shares
subject to the Plan. The granting of new Stock Options in connection with the
surrender of outstanding Stock Options under this Plan shall be considered for
the purposes of the Plan as the granting of new Stock Options and not an
alteration, amendment or modification of the Plan or of the Stock Options being
surrendered.
(i) Limitation on Exercisable Incentive Stock Options. The aggregate
fair market value of the Common Shares first becoming subject to exercise as
Incentive Stock Options by a key employee during any given calendar year shall
not exceed the sum of One Hundred Thousand Dollars ($100,000). Such aggregate
fair market value shall be determined as of the date such Option is granted,
taking into account, in the order in which granted, any other incentive stock
options granted by the Company, or by a parent or subsidiary thereof.
8. Restricted Stock.
(a) Grant. The Committee shall determine the key employees to whom, and
the time or times at which, Grants of Restricted Stock will be made, the number
of shares of Restricted Stock to be granted, the price (if any) to be paid by
such key employees (subject to Section 8(b)), the time or times within which
such Restricted Stock grants may be subject to forfeiture, and the other terms
and conditions of the grants in addition to those set forth in Section 8(b). The
Committee may condition the grant of Restricted Stock upon the attainment of
specified performance goals or such other factors as the Committee may determine
in its sole discretion.
(b) Terms and Conditions. Restricted Stock granted under the Plan shall
contain any terms and conditions, not inconsistent with the provisions of the
Plan, which are deemed desirable by the Committee. A key employee who receives a
grant of Restricted Stock shall not have any rights with respect to such Grant,
unless and until such key employee has executed an agreement evidencing such
Grant in the form approved from time to time by the Committee, has delivered a
fully executed copy thereof to the Company, and has otherwise complied with the
applicable terms and conditions of such Grant. In addition, Restricted Stock
granted under the Plan shall be subject to the following terms and conditions:
(i) The purchase price for Common Shares consisting of Restricted
Stock, if any, will be specified by the Committee.
(ii) Grants of Restricted Stock shall only be accepted by executing a
Restricted Stock agreement and paying, in cash or by check, whatever
price (if any) is required under Section 8(b)(i).
(iii) Each key employee granted Restricted Stock shall be issued a
stock certificate in respect of such shares of Restricted Stock. Such
certificate shall be registered in the name of such key employee, and
shall bear an appropriate legend referring to the terms, conditions,
and restrictions applicable to such Grant.
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(iv) Any stock certificates evidencing Common Shares consisting of
Restricted Stock shall either (A) be held in custody by the Company
until the employment and other restrictions thereon shall all have
lapsed; or (B) be affixed with a legend, identifying such Shares as
Restricted Stock and expressly prohibiting the sale, transfer, tender,
pledge, assignment or encumbrance of such Shares, as the Committee
shall determine. With respect to any Restricted Stock held in custody
by the Company, the key employee granted such Restricted Stock shall
deliver to the Company a stock power, endorsed in blank, relating to
the Common Shares represented by such Stock. With respect to any
Restricted Stock held by a key employee under legend, the key employee
granted such Restricted Stock shall deliver to the Company an
acknowledgement that such Stock remains subject to a substantial risk
of forfeiture in the event of termination of employment under certain
circumstances, and that the certificates representing ownership of such
Stock will be surrendered to the Company immediately upon any such
termination of employment.
(v) Subject to the provisions of the Plan and the Restricted Stock
agreement, during a temporal period set by the Committee and commencing
with the date of such Grant (the "Restriction Period"), a key employee
shall not be permitted to sell, transfer, tender, pledge, assign or
otherwise encumber any Restricted Stock granted under the Plan.
However, the Committee, in its sole discretion, may provide for the
lapse of such transfer or other restrictions in installments, or
accelerate or waive such restrictions in whole or in part, based on
service, performance or other factors and criteria selected by the
Committee.
(vi) Except as provided in this Section 8(b)(vi) and Section 8(b)(v), a
key employee shall have, with respect to shares of Restricted Stock
granted to him, all of the rights of a shareholder of the Company,
including the right to vote such Stock and the right to receive any
dividends thereon. The Committee, in its sole discretion and as
determined at the time of a Grant of Restricted Stock, may permit or
require cash dividends otherwise due and payable to be deferred and, if
the Committee so determines, reinvested either in additional Restricted
Stock (to the extent Common Shares are available), or otherwise. Stock
dividends issued with respect to Restricted Stock shall be treated as
additional shares of Restricted Stock. As Restricted Stock, such
additional Common Shares will be subject to the same restrictions,
terms and conditions applicable to the Restricted Stock with respect to
which such additional Common Shares were issued.
(vii) No Restricted Stock shall be transferable by a key employee other
than by will or by the laws of descent and distribution.
(viii) In the event Restricted Stock is forfeited by a key employee,
the Company will refund to such key employee any payment(s) made by
such key employee to purchase such Stock, promptly upon such forfeiture
(and any corresponding surrender of stock certificates).
(c) Minimum Value Provisions. To ensure that Grants of Restricted Stock
actually reflect the performance of the Company and service of the key employee,
the Committee may provide, in its sole discretion, for a tandem
performance-based award, or other grant, designed to guarantee a minimum value,
payable in cash or Common Shares, to the recipient of a Restricted Stock Grant,
subject to such performance, future service, deferral and other terms and
conditions as may be specified by the Committee.
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9. Stock Appreciation Rights. A key employee may be granted the right
to receive a payment based on the increase in the value of Common Shares
occurring after the date of such Grant; such rights shall be known as Stock
Appreciation Rights ("SARs"). SARs may (but need not) be granted to a key
employee in tandem with, and exercisable in lieu of exercising, a Grant of Stock
Options. SARs will be specifically granted upon terms and conditions specified
by the Committee, if the Company is the employer of the key employee, or by a
subsidiary corporation subject to the Committee's approval, if such subsidiary
corporation is the employer of the key employee. No optionee shall be entitled
to SAR rights solely as a result of the grant of a Stock Option to him. Any such
rights, if granted, may only be exercised by the holder thereof, either with
respect to all, or a portion, of the Stock Option to which it applies. When
granted in tandem with a Stock Option, an SAR shall provide that the holder of a
Stock Option shall have the right to receive an amount equal to one hundred
percent (100%) of the excess, if any, of the fair market value of the Common
Shares covered by such Option, determined as of the date of exercise of such SAR
by the Committee (in the same manner as such value is determined for purposes of
the granting of Stock Options), over the price to be paid for such Common Shares
under such Option. Such amount shall be payable by either the Company or the
subsidiary corporation, whichever such corporation is the employer of the key
employee, in one or more of the following manners, as determined by the
Committee:
(a) cash (or check);
(b) fully paid Common Shares having a fair market value equal to
such amount; or
(c) a combination of cash (or check) and Common Shares.
In no event may any person exercise any SARs granted hereunder unless (i) such
person is then permitted to exercise the Stock Option or the portion thereof
with respect to which such SARs relate, and (ii) the fair market value of the
Common Shares covered by the Stock Option, determined as provided above, exceeds
the option price of such Common Shares. Upon the exercise of any SARs, the Stock
Option, or that portion thereof to which such SARs relate, shall be canceled and
automatically extinguished. A SAR granted in tandem with a Stock Option
hereunder shall be made a part of the Stock Option agreement to which such SAR
relates, in a form approved by the Committee and not inconsistent with this
Plan. The granting of a Stock Option or SAR shall impose no obligation upon the
optionee to exercise such Stock Option or SAR. The Company's or a subsidiary
corporation's obligation to satisfy SARs shall not be funded or secured in any
manner. No SAR granted hereunder shall be transferable by the key employee
granted such SAR, other than by will or the laws of descent and distribution.
After the Grant of an SAR, an optionee intending to rely on an
exemption from Section 16(b) of the Securities Exchange Act of 1934 (the
"Exchange Act") shall be required to hold such SAR for six (6) months from the
date the price for such SAR is fixed to the date of cash settlement.
Additionally, in order to remain exempt from Section 16(b) of the Exchange Act,
an SAR must be exercised by an optionee subject to such Section only during the
period beginning on the third business day following the release of a summary
statement of the Company's quarterly or annual sales and earnings and ending on
the twelfth business day following said date.
10. Termination of Employment. If a key employee ceases to be an
employee of the Company and every subsidiary corporation, for a reason other
than death, retirement, or permanent and total disability, his Grants shall,
unless extended by the Committee on or before his date of termination of
employment, terminate on the effective date of such termination of employment.
Neither the key employee nor any other person shall have any right after such
date to exercise all or any part of his Stock Options or SARs, and all
Restricted Stock which is not vested or otherwise subject to restriction shall
thereupon be forfeited, and/or declared void and without value.
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If termination of employment is due to death or permanent and total
disability, then outstanding Stock Options and SARs may be exercised within the
one (1) year period ending on the anniversary of such death or permanent and
total disability. In the case of death, such outstanding Stock Options and SARs
shall be exercised by such key employee's estate, or the person designated by
such key employee by will, or as otherwise designated by the laws of descent and
distribution. Notwithstanding the foregoing, in no event shall any Stock Option
or SAR be exercisable after the expiration of the option period, and in the case
of exercises made after a key employee's death, not to any greater extent than
the key employee would have been entitled to exercise such Option or SAR at the
time of his death. Restricted Stock held by a key employee whose employment by
the Company or any subsidiary corporation terminates by reason of death shall
thereupon vest and all restrictions and risks of forfeiture thereon shall
thereupon lapse.
Subject to the discretion of the Committee, in the event a key employee
terminates employment with the Company and all subsidiary corporations because
of normal or early retirement under the Keithley Instruments, Inc., Employees'
Pension Plan (or any successor pension plan), or (in the case of Restricted
Stock) permanent and total disability, (a) any then-outstanding Stock Options
and/or SARs held by such key employee shall lapse at the earlier of the end of
the term of such Stock Option or SAR, or three (3) months after such retirement
or permanent and total disability; and (b) any Restricted Stock held by such key
employee shall thereafter vest and any applicable restrictions shall lapse, to
the extent such Restricted Stock would have become vested or no longer subject
to restriction within one year from the time of termination had the key employee
continued to fulfill all of the conditions of the Restricted Stock during such
period (or on such accelerated basis as the Committee may determine at or after
date of Grant).
In the event an employee of the Company or one of its subsidiary
corporations is granted a leave of absence by the Company or such subsidiary
corporation to enter military service or because of sickness, his employment
with the Company or such subsidiary corporation shall not be considered
terminated, and he shall be deemed an employee of the Company or such subsidiary
corporation during such leave of absence or any extension thereof granted by the
Company or such subsidiary corporation.
11. Change of Control. Upon the occurrence of a Change of Control (as
defined below), notwithstanding any other provisions hereof or of any agreement
to the contrary, all Stock Options and SARs granted under this Plan shall become
immediately exercisable in full and all Restricted Stock grants shall become
immediately vested and any applicable restrictions shall lapse.
For purposes of this Plan, a Change of Control shall be deemed to have
occurred if: (i) a tender offer shall be made and consummated for the ownership
of 25% or more of the outstanding voting securities of the Company; (ii) the
Company shall be merged or consolidated with another corporation and, as a
result of such merger or consolidation, less than 75% of the outstanding voting
securities of the surviving or resulting corporation shall be owned in the
aggregate by the former shareholders of the Company as the same shall have
existed immediately prior to such merger or consolidation; (iii) the Company
shall sell substantially all of its assets to another corporation which is not a
wholly owned subsidiary; or (iv) a person, within the meaning of Section 3(a)(9)
or of Section 13(d)(3) (as in effect on the date hereof) of the Exchange Act,
shall acquire, other than by reason of inheritance, twenty-five percent (25%) or
more of the outstanding voting securities of the Company (whether directly,
indirectly, beneficially or of record). In making any such determination,
transfers made by a person to an affiliate of such person (as determined by the
Board of Directors of the Company), whether by gift, devise or otherwise, shall
not be taken into account. For purposes of this Plan, ownership of voting
securities shall take into account and shall include ownership as determined by
applying the provisions of Rule 13d-3(d)(1)(i) as in effect on the date hereof
pursuant to the Exchange Act.
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12. Amendments to Plan. The Committee is authorized to interpret this
Plan and from time to time adopt any rules and regulations for carrying out this
Plan that it may deem advisable. Subject to the approval of the Board of
Directors of the Company, the Committee may at any time amend, modify, suspend
or terminate this Plan. In no event, however, without the approval of
shareholders, shall any action of the Committee or the Board of Directors result
in:
(a) Materially amending, modifying or altering the eligibility
requirements provided in Section 5 hereof;
(b) Materially increasing, except as provided in Section 6 hereof,
the maximum number of shares subject to Grants; or
(c) Materially increasing the benefits accruing to participants
under this Plan;
except to conform this Plan and any agreements made hereunder to changes in the
Code or governing law.
13. Investment Representation, Approvals and Listing. The Committee
may, if it deems appropriate, condition its grant of any Stock Option hereunder
upon receipt of the following investment representation from the optionee:
"I agree that any Common Shares of Keithley Instruments, Inc. which I
may acquire by virtue of this Stock Option shall be acquired for
investment purposes only and not with a view to distribution or resale,
and may not be transferred, sold, assigned, pledged, hypothecated or
otherwise disposed of by me unless (i) a registration statement or
post-effective amendment to a registration statement under the
Securities Act of 1933, as amended, with respect to said Common Shares
has become effective so as to permit the sale or other disposition of
said shares by me; or (ii) there is presented to Keithley Instruments,
Inc. an opinion of counsel satisfactory to Keithley Instruments, Inc.
to the effect that the sale or other proposed disposition of said
Common Shares by me may lawfully be made otherwise than pursuant to an
effective registration statement or post-effective amendment to a
registration statement relating to the said shares under the Securities
Act of 1933, as amended."
The Company shall not be required to issue any certificate or
certificates for Common Shares upon the exercise of any Stock Option or a SAR
granted under this Plan prior to (i) the obtaining of any approval from any
governmental agency which the Committee shall, in its sole discretion, determine
to be necessary or advisable; (ii) the admission of such shares to listing on
any national securities exchange on which the Common Shares may be listed; (iii)
the completion of any registration or other qualifications of the Common Shares
under any state or federal law or ruling or regulations of any governmental body
which the Committee shall, in its sole discretion, determine to be necessary or
advisable or the determination by the Committee, in its sole discretion, that
any registration or other qualification of the Common Shares is not necessary or
advisable; and (iv) the obtaining of an investment representation from the
optionee in the form stated above or in such other form as the Committee, in its
sole discretion, shall determine to be adequate.
14. General Provisions. The form and substance of Stock Option
agreements, Restricted Stock agreements, and SAR agreements made hereunder,
whether granted at the same or different times, need not be identical. Nothing
in this Plan or in any agreement shall confer upon any employee any right to
continue in the employ of the Company or any of its subsidiary corporations, to
be entitled to any remuneration or benefits not set forth in this Plan or such
Grant, or to interfere with or limit the right of the Company or any subsidiary
corporation to terminate his employment at any time, with or without cause.
Nothing contained in this Plan or in any Stock Option agreement or SAR shall be
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construed as entitling any optionee to any rights of a shareholder as a result
of the grant of a Stock Option or an SAR, until such time as Common Shares are
actually issued to such optionee pursuant to the exercise of such Option or SAR.
This Plan may be assumed by the successors and assigns of the Company. The
liability of the Company under this Plan and any sale made hereunder is limited
to the obligations set forth herein with respect to such sale and no term or
provision of this Plan shall be construed to impose any liability on the Company
in favor of any employee with respect to any loss, cost or expense which the
employee may incur in connection with or arising out of any transaction in
connection with this Plan. The cash proceeds received by the Company from the
issuance of Common Shares pursuant to this Plan will be used for general
corporate purposes. The expense of administering this Plan shall be borne by the
Company. The captions and section numbers appearing in this Plan are inserted
only as a matter of convenience. They do not define, limit, construe or describe
the scope or intent of the provisions of this Plan.
15. Termination of This Plan. This Plan shall terminate on February 8,
2002, and thereafter no Stock Options or Restricted Stock or SARs shall be
granted hereunder. All Stock Options and SARs outstanding at the time of
termination of this Plan shall continue in full force and effect according to
their terms and the terms and conditions of this Plan.
Page 10
11
KEITHLEY INSTRUMENTS, INC.
Amendment To The 1992 Stock Incentive Plan
To Increase Number of Shares Available for Grant
In accordance with action duly taken by the Board of Directors
of Keithley Instruments, Inc. (the "Company"), Section 6 of the Keithley
Instruments, Inc. 1992 Stock Incentive Plan (the "1992 Plan") is hereby amended
to increase the number of common shares subject to issuance under the 1992 Plan
to a total of 1,900,000 common shares (after taking into account the effects of
the 2-for-1 stock split), subject to approval by an affirmative vote by a
majority of the Company's shareholders.
Accordingly, the second paragraph in Section 6 of the 1992
Plan is hereby amended, effective December 9, 1995, so as to provide in its
entirety as follows:
Subject only to the provisions of the next succeeding
paragraph of this Section 6, the aggregate number of Common
Shares made subject to all Grants under the Plan shall be one
million nine hundred thousand (1,900,000) Common Shares. Such
aggregate number of Common Shares shall not include any Common
Shares reacquired or never issued due to a forfeiture,
exchange or relinquishment of rights under a Grant made
hereunder.
The Plan in all other respects remains unchanged.
KEITHLEY INSTRUMENTS, INC.
By /s/ Joseph P. Keithley
----------------------
Its Chairman
---------------------
12
KEITHLEY INSTRUMENTS, INC.
1992 STOCK INCENTIVE PLAN
1997 AMENDMENT
In accordance with Section 12 of the Keithley Instruments, Inc. 1992
Stock Incentive Plan (the "Plan"), Compensation Committee of the Board of
Directors of Keithley Instruments, Inc., an Ohio corporation (the "Committee")
hereby amends the Plan, effective February 15, 1997, in the following respects:
1. Section 4 of the Plan is amended so as to provide in its entirety as
follows:
"4. Administration of the Plan. The Plan shall be administered
by the Compensation Committee of the Board of Directors of the Company,
however described, or by any other committee selected by such Board of
Directors by majority vote and composed of no fewer than two (2)
members of such Board of Directors who are "non-employee directors" as
defined under Rule 16b-3(b)(3) of the Securities Exchange Act of 1934
(the "Committee"). A member of the Committee shall not be eligible to
participate in this Plan while serving on the Committee.
A majority of the Committee shall constitute a
quorum. The acts of a majority of the members present at any
meeting at which a quorum is present (or acts unanimously
approved in writing by the members of the Committee) shall
constitute binding acts of the Committee.
Subject to the terms and conditions of the Plan, the
Committee shall be authorized and empowered:
(a) To select the key employees to whom Grants may be
made;
(b) To determine the number of Common Shares to be
covered by any Grant;
(c) To prescribe the terms and conditions of any Grants
made under the Plan, and the form(s) and agreement(s)
used in connection with such Grants, which shall
include agreements governing the granting of
Restricted Stock, Stock Options and/or SARs;
(d) To determine the time or times when Stock Options
and/or SARs will be granted and when they will
terminate in whole or in part;
(e) To determine the time or times when Stock Options and
SARs that are granted may be exercised;
(f) To determine, at the time a Stock Option is granted
under the Plan, whether such Option is an Incentive
Stock Option entitled to the benefits of Section 422
of the Code;
(g) To establish any other Stock Option agreement
provisions not inconsistent with the terms and
conditions of the Plan or, where the Stock Option is
an Incentive Stock Option, with the terms and
conditions of Section 422 of the Code;
13
(h) To determine whether SARs will be made part of any
Grants consisting of Stock Options, and to approve
any SARs made part of any such Grants pursuant to
Section 9 hereof; and
(i) To delegate to one (1) or more Company officers
limited authority to make de minimis Grants of Stock
Options or Incentive Stock Options (not to exceed
2,500 Common Shares per individual), to select
individuals to whom offers of Company employment are,
or are expected to be made, at Fair Market Value and
otherwise under terms and conditions approved in
advance by the Committee, subject to ratification by
the Committee."
2. Section 5 of the Plan is amended so as to provide in its entirety as
follows:
"5. Employees Eligible for Grants. Grants may be made from
time to time to those key employees of the Company or a subsidiary
corporation, who are designated by the Committee in its sole and
exclusive discretion (or by its delegee(s) in accordance with Section
4(i) hereof). Key employees may include, but shall not necessarily be
limited to, members of the Board of Directors (excluding members of the
Committee), and officers, of the Company and any subsidiary
corporation; however, Stock Options intended to qualify as Incentive
Stock Options shall only be granted to key employees while actually
employed by the Company or a subsidiary corporation. The Committee may
grant more than one Stock Option, with or without SARs, to the same key
employee. No Stock Option shall be granted to any key employee during
any period of time when such key employee is on a leave of absence."
The Plan otherwise remains unchanged.
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KEITHLEY INSTRUMENTS, INC.
1992 STOCK INCENTIVE PLAN
1999 AMENDMENT
In accordance with Section 12 of the Keithley Instruments, Inc. 1992
Stock Incentive Plan (the "Plan"), the Compensation Committee of the Board of
Directors of Keithley Instruments, Inc., an Ohio corporation (the "Committee")
hereby amends the Plan, effective September 30, 1999, in the following respects:
Section 10 of the Plan is amended so as to provide in its entirety as
follows:
"10. Termination of Employment. If a key employee ceases to be
an employee of the Company and every subsidiary corporation, for a
reason other than death, retirement, or permanent and total disability,
his Grants shall, unless extended by the Committee on or before his
date of termination of employment, terminate on the effective date of
such termination of employment. Neither the key employee nor any other
person shall have any right after such date to exercise all or any part
of his Stock Options or SARs, and all Restricted Stock which is not
vested or otherwise subject to restriction shall thereupon be
forfeited, and/or declared void and without value.
If termination of employment is due to death or permanent and
total disability, then outstanding Stock Options and SARs may be
exercised within the one (1) year period ending on the anniversary of
such death or permanent and total disability. In the case of death,
such outstanding Stock Options and SARs shall be exercised by such key
employee's estate, or the person designated by such key employee by
will, or as otherwise designated by the laws of descent and
distribution. Notwithstanding the foregoing, in no event shall any
Stock Option or SAR be exercisable after the expiration of the option
period, and in the case of exercises made after a key employee's death,
not to any greater extent than the key employee would have been
entitled to exercise such Option or SAR at the time of his death.
Restricted Stock held by a key employee whose employment by the Company
or any subsidiary corporation terminates by reason of death shall
thereupon vest and all restrictions and risks of forfeiture thereon
shall thereupon lapse.
Subject to the discretion of the Committee, in the event a key
employee terminates employment with the Company and all subsidiary
corporations because of normal, early or disability retirement under
the Keithley Instruments, Inc., Employees' Pension Plan (or any
successor pension plan), (a) any then outstanding Stock Options and/or
SARs held by such key employee shall lapse at the earlier of (i) the
end of the term of such Stock Option or SAR, or (ii) twelve (12) months
after such retirement or permanent and total disability (subject only
to the three (3) month exercise limitation
15
applicable to Incentive Stock Options); and (b) any Restricted Stock
held by such key employee shall thereafter vest and any applicable
restrictions shall lapse, to the extent such Restricted Stock would
have become vested or no longer subject to restriction within twelve
(12) months from the time of termination had the key employee continued
to fulfill all of the conditions of the Restricted Stock during such
period (or on such accelerated basis as the Committee may determine at
or after date of Grant).
In the event an employee of the Company or one of its
subsidiary corporations is granted a leave of absence by the Company or
such subsidiary corporation to enter military service or because of
sickness, his employment with the Company or such subsidiary
corporation shall not be considered terminated, and he shall be deemed
an employee of the Company or such subsidiary corporation during such
leave of absence or any extension thereof granted by the Company or
such subsidiary corporation."
The Plan otherwise remains unchanged.
IN WITNESS WHEREOF, the undersigned members of the Committee
have set their hand this 10th day of September, 1999.
/s/ James B. Griswold
------------------------
James B. Griswold
/s/ James T. Bartlett
------------------------
James T. Bartlett
/s/ R. Elton White
------------------------
R. Elton White
/s/ Arden L. Bement, Jr.
------------------------
Arden L. Bement, Jr.
16
KEITHLEY INSTRUMENTS, INC.
Amendment To The 1992 Stock Incentive Plan
To Increase Number of Shares Available for Grant
In accordance with action duly taken by the Board of Directors of
Keithley Instruments, Inc. (the "Company"), Section 6 of the Keithley
Instruments, Inc. 1992 Stock Incentive Plan (the "1992 Plan") is hereby amended
to increase the number of common shares subject to issuance under the 1992 Plan
to a total of 2,700,000 common shares, subject to approval by an affirmative
vote by a majority of the Company's shareholders.
Accordingly, the second paragraph in Section 6 of the 1992 Plan is
hereby amended, effective December 3, 1999, so as to provide in its entirety as
follows:
Subject only to the provisions of the next succeeding
paragraph of this Section 6, the aggregate number of Common Shares made
subject to all Grants under the Plan shall be two million seven hundred
thousand (2,700,000) Common Shares. Such aggregate number of Common
Shares shall not include any Common Shares reacquired or never issued
due to a forfeiture, exchange or relinquishment of rights under a Grant
made hereunder.
The Plan in all other respects remains unchanged.