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EXHIBIT 10.01
CSK AUTO CORPORATION
DIRECTORS STOCK PLAN
SECTION 1
PURPOSE
The purpose of the CSK Auto Corporation Directors Stock Plan (the "Plan")
is to advance the interests of CSK Auto Corporation, a Delaware corporation
(hereinafter the "Company"), by enabling the Company to attract, retain and
motivate qualified individuals to serve on the Company's Board of Directors
and to align the financial interests of such individuals with those of the
Company's stockholders by providing for or increasing their proprietary
interest in the Company. The stock options granted pursuant to this Plan
are not qualified under Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code").
SECTION 2
DEFINITIONS
"BOARD" MEANS THE BOARD OF DIRECTORS OF THE COMPANY.
"COMMITTEE" MEANS THE BOARD AND/OR A COMMITTEE OF THE BOARD
ACTING PURSUANT TO ITS AUTHORIZATION TO ADMINISTER THIS PLAN UNDER
SECTION 7.
"COMMON STOCK" MEANS THE COMPANY'S COMMON STOCK, PAR VALUE
$.01 PER SHARE, AS PRESENTLY CONSTITUTED, SUBJECT TO ADJUSTMENT AS
PROVIDED IN SECTION 9.
"FAIR MARKET VALUE" MEANS, AS OF ANY DATE, AND UNLESS THE
BOARD SHALL SPECIFY OTHERWISE, THE MEAN BETWEEN THE HIGH AND THE LOW
MARKET PRICES FOR THE COMMON STOCK REPORTED FOR THAT DATE ON THE
COMPOSITE TAPE FOR SECURITIES LISTED ON THE NEW YORK STOCK EXCHANGE OR,
IF THE COMMON STOCK DID NOT TRADE ON THE NEW YORK STOCK EXCHANGE ON THE
DATE IN QUESTION, THEN FOR THE NEXT PRECEDING DATE FOR WHICH THE COMMON
STOCK TRADED ON THE NEW YORK STOCK EXCHANGE.
"NON-EMPLOYEE DIRECTOR" MEANS A MEMBER OF THE BOARD WHO IS NOT
AT THE TIME ALSO AN EMPLOYEE OF THE COMPANY OR ANY OF ITS DIRECT OR
INDIRECT MAJORITY-OWNED SUBSIDIARIES (REGARDLESS OF WHETHER SUCH
SUBSIDIARY IS ORGANIZED AS A CORPORATION, PARTNERSHIP OR OTHER ENTITY).
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SECTION 3
SHARES SUBJECT TO THE PLAN
Subject to adjustment as provided in Section 9, the maximum number of
shares of Common Stock which may be issued pursuant to this Plan shall not
exceed 50,000. Shares issued under this Plan may be authorized and unissued
shares of Common Stock or shares of Common Stock reacquired by the Company.
All or any shares of Common Stock subject to a stock option or stock grant
which for any reason are not issued or are reacquired under the stock
option or stock grant may again be made subject to a stock option or stock
grant under the Plan.
SECTION 4
PARTICIPANTS
Any person who is a Non-Employee Director shall be eligible for the
award of stock options and/or stock grants hereunder.
SECTION 5
NON-EMPLOYEE DIRECTOR AWARDS
The Board may provide for stock options and/or stock grants to be awarded
to Non-Employee Directors in consideration for their service to the
Company. The Board shall determine to which Non-Employee Directors any such
stock options and/or stock grants shall be awarded hereunder (any such
person, a "Participant"). The Board shall specify the number of shares
subject to each stock option or stock grant provided for under this Section
5, or the formula pursuant to which such number shall be determined, the
Participants to receive any such award, the date of award and the vesting
and expiration terms applicable to such stock option or stock grant. The
award of stock options or stock grants hereunder may, but need not, be
conditioned on the Non-Employee Director electing to forego his or her
right to all or any part of his or her cash retainer or other fees. Subject
to adjustment pursuant to Section 9, the maximum number of shares of Common
Stock subject to stock options and stock grants awarded under this Plan
during any calendar year to any person on account of his or her service as
a Non-Employee Director, other than stock options or stock grants that a
Non-Employee Director has elected to receive in lieu of cash retainer or
other fees, shall not exceed 50,000 shares.
SECTION 6
TERMS AND CONDITIONS OF STOCK OPTIONS AND STOCK GRANTS
General Terms and Conditions: Stock options and stock grants awarded
pursuant to the Plan need not be identical but each stock option and stock
grant shall be subject to the following general terms and conditions:
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TERMS AND RESTRICTIONS UPON SHARES: THE BOARD MAY PROVIDE THAT
THE SHARES OF COMMON STOCK ISSUED UPON EXERCISE OF A STOCK OPTION OR
RECEIPT OF A STOCK GRANT SHALL BE SUBJECT TO SUCH FURTHER CONDITIONS,
RESTRICTIONS OR AGREEMENTS AS THE BOARD IN ITS DISCRETION MAY SPECIFY
PRIOR TO THE EXERCISE OF SUCH STOCK OPTION OR RECEIPT OF SUCH STOCK
GRANT, INCLUDING WITHOUT LIMITATION, DEFERRALS ON ISSUANCE, CONDITIONS
ON VESTING OR TRANSFERABILITY, AND FORFEITURE OR REPURCHASE PROVISIONS.
THE COMMITTEE MAY ESTABLISH RULES FOR THE DEFERRED DELIVERY OF SHARES
OF COMMON STOCK UPON EXERCISE OF A STOCK OPTION OR RECEIPT OF A STOCK
GRANT WITH THE DEFERRAL EVIDENCED BY USE OF "STOCK UNITS" EQUAL IN
NUMBER TO THE NUMBER OF SHARES OF COMMON STOCK WHOSE DELIVERY IS SO
DEFERRED. A "STOCK UNIT" IS A BOOKKEEPING ENTRY REPRESENTING AN AMOUNT
EQUIVALENT TO THE FAIR MARKET VALUE OF ONE SHARE OF COMMON STOCK. STOCK
UNITS REPRESENT AN UNFUNDED AND UNSECURED OBLIGATION OF THE CORPORATION
EXCEPT AS OTHERWISE PROVIDED BY THE BOARD. SETTLEMENT OF STOCK UNITS
UPON EXPIRATION OF THE DEFERRAL PERIOD SHALL BE MADE IN SHARES OF
COMMON STOCK OR OTHERWISE AS DETERMINED BY THE COMMITTEE. THE AMOUNT OF
COMMON STOCK, OR OTHER SETTLEMENT MEDIUM, TO BE SO DISTRIBUTED MAY BE
INCREASED BY AN INTEREST FACTOR OR BY DIVIDEND EQUIVALENTS. UNTIL A
STOCK UNIT IS SETTLED, THE NUMBER OF SHARES OF COMMON STOCK REPRESENTED
BY A STOCK UNIT SHALL BE SUBJECT TO ADJUSTMENT PURSUANT TO SECTION 9.
TRANSFERABILITY OF OPTION: UNLESS OTHERWISE PROVIDED BY THE
COMMITTEE, EACH STOCK OPTION SHALL BE TRANSFERABLE ONLY BY WILL OR THE
LAWS OF DESCENT AND DISTRIBUTION.
OTHER TERMS AND CONDITIONS: NO HOLDER OF A STOCK OPTION OR
STOCK GRANT SHALL HAVE ANY RIGHTS AS A STOCKHOLDER WITH RESPECT TO ANY
SHARES OF COMMON STOCK SUBJECT TO A STOCK OPTION OR STOCK GRANT
HEREUNDER UNTIL SAID SHARES HAVE BEEN ISSUED. STOCK OPTIONS AND STOCK
GRANTS MAY ALSO CONTAIN SUCH OTHER PROVISIONS, WHICH SHALL NOT BE
INCONSISTENT WITH ANY OF THE FOREGOING TERMS, AS THE BOARD OR THE
COMMITTEE SHALL DEEM APPROPRIATE. THE BOARD MAY WAIVE CONDITIONS TO
AND/OR ACCELERATE EXERCISABILITY OF A STOCK OPTION OR STOCK GRANT,
EITHER AUTOMATICALLY UPON THE OCCURRENCE OF SPECIFIED EVENTS (INCLUDING
IN CONNECTION WITH A CHANGE OF CONTROL OF THE COMPANY) OR OTHERWISE IN
ITS DISCRETION. NO STOCK OPTION OR STOCK GRANT, HOWEVER, NOR ANYTHING
CONTAINED IN THE PLAN, SHALL CONFER UPON ANY PARTICIPANT ANY RIGHT TO
SERVE AS A DIRECTOR OF THE COMPANY.
STOCK OPTION PRICE: THE EXERCISE PRICE FOR EACH STOCK OPTION
SHALL BE ESTABLISHED BY THE BOARD OR UNDER A FORMULA ESTABLISHED BY THE
BOARD. THE EXERCISE PRICE SHALL NOT BE LESS THAN THE FAIR MARKET VALUE
OF THE STOCK ON THE DATE OF GRANT. THE EXERCISE PRICE SHALL BE PAID IN
FULL AT THE TIME OF EXERCISE. THE EXERCISE PRICE SHALL BE PAYABLE IN
CASH, BY PAYMENT UNDER AN ARRANGEMENT WITH A BROKER WHERE PAYMENT IS
MADE PURSUANT TO AN IRREVOCABLE DIRECTION TO THE BROKER TO DELIVER ALL
OR PART OF THE PROCEEDS FROM THE SALE OF THE OPTION
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SHARES TO THE COMPANY, BY THE SURRENDER OF SHARES OF COMMON STOCK OWNED
BY THE OPTIONHOLDER EXERCISING THE OPTION AND HAVING A FAIR MARKET
VALUE ON THE DATE OF EXERCISE EQUAL TO THE EXERCISE PRICE BUT ONLY IF
SUCH WILL NOT RESULT IN AN ACCOUNTING CHARGE TO THE COMPANY, OR BY ANY
COMBINATION OF THE FOREGOING. IN ADDITION, THE EXERCISE PRICE SHALL BE
PAYABLE IN SUCH OTHER FORM(S) OF CONSIDERATION AS THE COMMITTEE IN ITS
DISCRETION SHALL SPECIFY, INCLUDING WITHOUT LIMITATION BY LOAN (AS
DESCRIBED IN SECTION 8) OR BY TECHNIQUES THAT MAY RESULT IN AN
ACCOUNTING CHARGE TO THE COMPANY.
STOCK GRANT TERMS: STOCK GRANTS UNDER THE PLAN MAY, IN THE
SOLE DISCRETION OF THE BOARD, BUT NEED NOT, BE CONDITIONED UPON THE
PARTICIPANT PAYING CASH OR CASH-EQUIVALENT CONSIDERATION OR AGREEING TO
FOREGO OTHER COMPENSATION FOR THE SHARES COVERED BY THE STOCK GRANT.
STOCK GRANTS UNDER THE PLAN MAY BE SUBJECT TO SUCH CONDITIONS,
RESTRICTIONS OR OTHER VESTING TERMS AS ARE ESTABLISHED IN THE SOLE
DISCRETION OF THE BOARD. THE CONDITIONS, RESTRICTIONS OR VESTING TERMS
MAY BE CONTINGENT UPON THE PASSAGE OF TIME, CONTINUED SERVICE OR
ACHIEVEMENT OF COMPANY OR INDIVIDUAL PERFORMANCE GOALS, AS SPECIFIED BY
THE BOARD.
SECTION 7
ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Board, except that as provided herein
the Plan may be administered by a Committee of the Board, as appointed from
time to time by the Board. The Board shall fill vacancies on and from time
to time may remove or add members to the Committee.
Subject to the express provisions of this Plan, the Committee shall be
authorized and empowered to do all things necessary or desirable in
connection with the administration of this Plan, including, without
limitation: (a) to prescribe, amend and rescind rules relating to this Plan
and to define terms not otherwise defined herein; (b) to prescribe the form
of documentation used to evidence any stock option or stock grant awarded
hereunder, including provision for such terms as it considers necessary or
desirable, not inconsistent with the terms established by the Board; (c) to
establish and verify the extent of satisfaction of any conditions to
exercisability applicable to stock options or to receipt or vesting of
stock grants; (d) to determine whether, and the extent to which,
adjustments are required pursuant to Section 9 hereof; and (e) to interpret
and construe this Plan, any rules and regulations under the Plan and the
terms and conditions of any stock option or stock grant awarded hereunder,
and to make exceptions to any procedural provisions in good faith and for
the benefit of the Company. Notwithstanding any provision of this Plan, the
Board may at any time limit the authority of the Committee to administer
this Plan.
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All decisions, determinations and interpretations by the Board or, except
as to the Board, the Committee regarding the Plan, any rules and
regulations under the Plan and the terms and conditions of any stock option
or stock grant awarded hereunder, shall be final and binding on all
Participants and holders of stock options and stock grants. The Board and
the Committee may consider such factors as it deems relevant, in its sole
and absolute discretion, in making such decisions, determinations and
interpretations including, without limitation, the recommendations or
advice of any officer or other employee of the Company and such attorneys,
consultants and accountants as it may select.
SECTION 8
LOANS
The Company may, if authorized by the Board, make loans for the purpose of
enabling a Participant to exercise stock options and, if applicable,
receive stock awarded under the Plan and to pay the tax liability resulting
from a stock option exercise or stock grant under the Plan. The Board shall
have full authority to determine the terms and conditions of such loans.
Such loans may be secured by the shares of Common Stock received upon
exercise of such stock option or receipt of such stock grant.
SECTION 9
ADJUSTMENT OF AND CHANGES IN THE STOCK
If the outstanding securities of the class then subject to this Plan are
increased, decreased or exchanged for or converted into cash, property or a
different number or kind of shares or securities, or if cash, property or
shares or securities are distributed in respect of such outstanding
securities, in either case as a result of a reorganization,
reclassification, dividend (other than a regular, quarterly cash dividend)
or other distribution, stock split, reverse stock split, spin-off or the
like, or if substantially all of the property and assets of the Company are
sold, then, unless the terms of such transaction shall provide otherwise,
the maximum number and type of shares or other securities that may be
issued under this Plan shall be appropriately adjusted. The Committee shall
determine in its sole discretion the appropriate adjustment to be effected
pursuant to the immediately preceding sentence. In addition, in connection
with any such change in the class of securities then subject to this Plan,
the Committee may make appropriate and proportionate adjustments in the
number and type of shares or other securities or cash or other property
that may be acquired pursuant to stock options and stock grants theretofore
awarded under this Plan and the exercise price of such stock options or
price, if any, of such stock grants.
No right to purchase or receive fractional shares shall result from any
adjustment in stock options or stock grants pursuant to this Section 9. In
case of any such adjustment, the shares subject to the stock option or
stock grant shall be rounded up to the nearest whole share of Common Stock.
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SECTION 10
REGISTRATION, LISTING OR QUALIFICATION OF STOCK
In the event that the Board or the Committee determines in its discretion
that the registration, listing or qualification of the shares of Common
Stock issuable under the Plan on any securities exchange or under any
applicable law or governmental regulation is necessary as a condition to
the issuance of such shares under the stock option or stock grant, the
stock option or stock grant shall not be exercisable or exercised in whole
or in part unless such registration, listing, qualification, consent or
approval has been unconditionally obtained.
SECTION 11
TAXES
The Board or Committee may make such provisions or impose such conditions
as it may deem appropriate for the withholding or payment by a Participant
of any taxes which it determines are necessary or appropriate in connection
with any issuance of shares under this Plan, and the rights of a holder of
a stock option or stock grant in any shares are subject to satisfaction of
such conditions. The Company shall not be required to issue shares of
Common Stock or to recognize the disposition of such shares until such
obligations are satisfied. At the Participant's election, any such
obligations may be satisfied by having the Company withhold a portion of
the shares of Common Stock that otherwise would be issued to the holder of
the stock option or stock grant upon exercise of the stock option or
vesting or receipt of the stock grant or by surrendering to the Company
shares of Common Stock previously acquired. The Company and any affiliate
of the Company shall not be liable to a Participant or any other persons as
to any tax consequence expected, but not realized, by any Participant or
other person due to the receipt of any stock options or shares awarded
hereunder.
SECTION 12
ARBITRATION AND APPLICABLE LAW
Any claim, dispute or other matter in question of any kind relating to this
Plan shall be settled by arbitration before a single arbitrator and
otherwise conducted in accordance with the Rules of the American
Arbitration Association, which proceedings shall be held in the city in
which the Company's executive offices are located. Notice of demand for
arbitration shall be made in writing to the opposing party and to the
American Arbitration Association within a reasonable time after the claim,
dispute or other matter in question has arisen. In no event shall a demand
for arbitration be made after the date when the applicable statute of
limitations would bar the institution of a legal or equitable proceeding
based on such claim, dispute or other matter in question. The decision of
the arbitrator shall be final and may be enforced in any court of competent
jurisdiction. This
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Plan and any rights hereunder shall be interpreted and construed in
accordance with the laws of the State of Delaware and applicable federal
law.
SECTION 13
EFFECTIVE DATE, AMENDMENT AND TERMINATION OF PLAN
This Plan shall become effective upon its approval by a majority of the
outstanding shares of the Company present, or represented by proxy, and
entitled to vote at the Company's 1999 annual meeting of stockholders to
take place following the conclusion of its 1998 fiscal year. Any stock
options and stock grants awarded prior to the such date shall be contingent
on such approval and, if such approval is not obtained, shall be null and
of no effect.
Unless earlier suspended or terminated by the Board, no stock options or
stock grants may be awarded after the tenth anniversary of the date the
Plan is approved by the Company's stockholders. The Board may periodically
amend the Plan as determined appropriate, without further action by the
Company's stockholders except to the extent required by applicable law.
Notwithstanding the foregoing, and subject to adjustment pursuant to
Section 9, the Plan may not be amended to increase the number of shares of
Common Stock authorized for issuance under the Plan, unless any such
amendment is approved by the Company's stockholders. The Plan may be
earlier terminated at such earlier time as the Board may determine.
Termination and expiration of the Plan will not affect the rights and
obligations arising under stock options or stock grants theretofore awarded
and then in effect.
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