EXHIBIT 10.17
HEICO CORPORATION
1993 STOCK OPTION PLAN
1. PURPOSE. The purpose of this Plan is to advance the interests of
HEICO Corporation, a Florida corporation (the "Company"), and its Subsidiaries
by providing an additional incentive to attract and retain qualified and
competent persons who provide management and other services and upon whose
efforts and judgement the success of the Company and Subsidiaries is largely
dependent, through the encouragement of stock ownership in the Company by such
persons.
2. DEFINITIONS. As used herein, the following terms shall have the
meanings indicated:
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Committee" shall mean the stock option committee
appointed by the Board pursuant to Section 12 hereof, or if not
appointed, the Board.
(c) "Common Stock" shall mean the common stock, par value $.01
per share, of the Company.
(d) "Director" shall mean a member of the Board.
(e) "Disinterested Person" shall mean a Director who, during
one year prior to the time he serves on the Committee and during such
service, has not received Shares, options for Shares or any rights with
respect to Shares under this Plan or any other employee and/or Director
benefit plan of the Company or any of its affiliates except pursuant to
an election to receive annual director's fees in securities of the
Company.
(f) "Employee" and "employment" shall, except where the
context otherwise requires, mean or refer to a Director and his
Directorship as well as to a regular employee and his employment.
(g) "Fair Market Value" of a Share on any date of reference
shall mean the Closing Price of the Common Stock on such date, unless
the Committee in its sole discretion shall determine otherwise in a
fair and uniform manner. For this purpose, the Closing Price of the
Common Stock on any business day shall be (i) if the Common Stock is
listed or admitted for trading on any United States national securities
exchange, or if actual transactions are otherwise reported on a
consolidated transaction reporting system, the last reported sale price
of Common Stock on such exchange or reporting system, as reported in
any newspaper of general circulation, or (ii) if the Common Stock is
quoted on the National Association of Securities Dealers Automated
Quotations System ("NASDAQ"), or any similar system of automated
dissemination of quotations of securities prices in common use, the
mean between the closing bid and asked quotations for Common Stock as
reported by the National Quotation Bureau, Incorporated, if at least
two securities dealers have inserted both bid and asked quotations for
Common Stock on at least 5 of the 10 preceding business days.
(h) "Grantee" shall mean a person to whom a stock option is
granted under this Plan or any person who succeeds to the rights of
such person under this Plan by reason of death of such person or
transfer of such option as may be allowed under this Plan.
(i) "Incentive Stock Option" means an option to purchase
Shares of Common Stock which is intended to qualify as an incentive
stock option as defined in Section 422 of the Internal Revenue Code.
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(j) "Internal Revenue Code" shall mean the Internal Revenue
Code of 1986, as amended from time to time.
(k) "Key Employee" means any person, including officers and
Directors, in the regular full-time employment of the Company or any
Subsidiary who, in the opinion of the Committee, is or is expected to
be responsible for the management, growth or protection of some part or
all of the business of the Company or a Subsidiary.
(l) "Non-qualified Stock Option" means an option to purchase
Shares of Common Stock which is not intended to qualify as an Incentive
Stock Option.
(m) "Option" (when capitalized) shall mean any option granted
under this Plan.
(n) "Plan" shall mean this 1993 Stock Option Plan for HEICO
Corporation.
(o) "Share(s)" shall mean a share or shares of the Common
Stock.
(p) "Subsidiary" shall mean any corporation (other than the
Company) in any unbroken chain of corporations, beginning with the
Company if, at the time of the granting of the Option, each of the
corporations other than the last corporation in the unbroken chain owns
stock possessing ten (10) percent or more of any class of any equity
security in one of the other corporations in such chain and has the
right to direct the management of the other corporation.
3. SHARES AND OPTIONS. The Company may grant to Grantees from time to
time Options to purchase an aggregate of up to 855,000 Shares from Shares held
in the Company's treasury or from authorized and unissued Shares. Of this
amount, all or any may be optioned as Incentive Stock Options, as Non-qualified
Stock Options, or any combination thereof. If any Option granted under this Plan
shall terminate, expire, or be cancelled or surrendered as to any Shares, new
Options may thereafter be granted covering such Shares.
4. CONDITIONS FOR GRANT OF OPTIONS.
(a) Each Option shall be evidenced by an Option Agreement,
which Option Agreement may be altered consistent with this Plan and
with the approval of both the Committee and the Grantee, that may
contain terms deemed necessary or desirable by the Committee,
including, but not limited to, a requirement that the Grantee agree
that, for a specified period after termination of his employment, he
will not enter into any employment with, or participate directly or
indirectly in, any entity which is directly or indirectly competitive
with the Company or any of its Subsidiaries, provided such terms are
not inconsistent with this Plan or any applicable law. Grantees shall
be selected by the Committee in its discretion and shall be employees
and Directors who are not employees; provided, however, that Directors
who are not employees shall not be eligible to receive Incentive Stock
Options. Any person who files with the Committee, in a form
satisfactory to the Committee, a written waiver of eligibility to
receive any Option under this Plan shall not be eligible to receive any
Option under this Plan for the duration of such waiver.
(b) In granting Options, the Committee shall take into
consideration the contribution the person has made to the success of
the Company or its Subsidiaries and such other factors as the Committee
shall determine. The Committee shall also have the authority to consult
with and receive recommendations from officers and other personnel of
the Company and its Subsidiaries with regard to these matters. The
Committee may from time to time in granting Options under the Plan
prescribe such other terms and conditions concerning such Options as it
deems appropriate, including, without limitation, (i) prescribing the
date or dates on which the Option becomes exercisable, (ii) providing
that the Option rights accrue or become exercisable in installments
over a period of years, or upon the attainment of stated goals or both,
or (iii) relating an Option to the continued employment of the Grantee
for a specified period of time, provided that such terms and conditions
are not more favorable to the Grantee than those expressly permitted
herein.
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(c) The Options granted to Grantees under this Plan shall be
in addition to regular salaries, Director's fees, pension, life
insurance or other benefits related to their employment or
Directorships with the Company or its Subsidiaries. Neither the Plan
nor any Option granted under the Plan shall confer upon any person any
right to employment or Directorship or continuation of employment or
Directorship by the Company or any of its Subsidiaries.
(d) The Committee in its sole discretion shall determine in
each case whether periods of military or government service shall
constitute a continuation of employment for the purposes of this Plan
or any Option.
(e) During each fiscal year of the Company, no Employee may be
granted Option(s) to purchase more than 100,000 Shares.
(f) No employee may be granted any Incentive Stock Option
pursuant to this plan to the extent that the aggregate fair market
value (determined at the time the Option is granted) of the Shares with
respect to which Incentive Stock Options granted to the employee under
the terms of this Plan or its predecessor after December 31, 1986 are
exercisable for the first time by the employee during any calendar year
exceeds $100,000.
(g) Option agreements with respect to Incentive Stock Options
shall contain such terms and conditions as may be required under
Section 422 of the Internal Revenue Code, as such section may be
amended from time to time.
5. OPTION PRICE. The option price per share of any Option shall be the
price determined by the Committee; provided, however, that in no event shall the
option price per Share of any Incentive Stock Option be less than (i) 100% or
(ii) in the case of an individual who owns stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company, 110%, of the
Fair Market Value of the Shares underlying such Option on the date such Option
is granted.
6. EXERCISE OF OPTIONS. An Option shall be deemed exercised when (i)
the Company has received written notice of such exercise in accordance with the
terms of the Option, (ii) full payment of the aggregate option price of the
Shares as to which the Option is exercised has been made, and (iii) arrangements
that are satisfactory to the Committee in its sole discretion have been made for
the Grantee's payment to the Company of the amount, if any, that is necessary to
withhold in accordance with applicable Federal or State tax withholding
requirements. Unless further limited by the Committee in any Option Agreement,
the option price of any Shares shall be paid in cash, by certified check or
official bank check, by money order, by the Grantee's promissory note, with
Shares (including Shares acquired pursuant to a partial and simultaneous
exercise of the Option) or by a combination of the above; provided further,
however, that the Committee in its sole discretion may accept a personal check
in full or partial payment of any Shares. If the exercise price is paid in whole
or in part with Shares, the value of the Shares surrendered shall be their Fair
Market Value on the business day immediately preceding the date the Option is
exercised. The Company in its sole discretion may, on an individual basis or
pursuant to a general program established in connection with this Plan, lend
money to a Grantee to obtain the cash necessary to exercise all or a portion of
an Option granted hereunder or to pay any tax liability of the Grantee
attributable to such exercise. If the exercise price is paid in whole or in part
with the Grantee's promissory note, such note shall, unless specified by the
Committee at the time of grant or any time thereafter, (w) provide for full
recourse to the maker, (x) be collateralized by the pledge of the Shares that
the Grantee purchases upon exercise of the Option, (y) bear interest at the
prime rate of the Company's principal lender and (z) contain such other terms as
the Committee in its sole discretion shall reasonably require. No Grantee or
permitted transferee(s) thereof shall be deemed to be a holder of any Shares
subject to an Option unless and until exercise has been completed pursuant to
clauses (i-iii) above. No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property) or distributions
or other rights for which the record date is prior to the date of exercise,
except as expressly provided in Section 9 hereof.
7. EXERCISABILITY OF OPTIONS. Any Option shall become exercisable in
such amounts, at such intervals and upon such terms as the Committee shall
provide in the corresponding Option agreement, except as otherwise provided in
this Section 7.
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(a) The expiration date of an Option shall be determined by
the Committee at the time of grant, but in no event shall an Incentive
Stock Option be exercisable after the expiration of (i) ten (10) years
from the date of grant of the Option or (ii) in the case of an
individual who owns stock possessing more than 10% of the total
combined voting power of all classes of voting stock of the Company,
five years from the date of the grant of the Option.
(b) Except to the extent otherwise provided in any Option
agreement, each outstanding Option shall become immediately fully
exercisable
(i) if any "person" (as such term is used in Sections
13(d) and 14(d) (2) of the Securities Exchange Act of 1934),
except the Mendelson Reporting Group, as that group is defined
in an Amendment to a Schedule 13D filed on February 26, 1992
or any subsequent amendment to the aforementioned 13D, is or
becomes a beneficial owner, directly or indirectly, of
securities of the Company representing 15% or more of the
combined voting power of the Corporation's then outstanding
securities;
(ii) if, during any period of two consecutive years,
individuals who at the beginning of such period constitute the
Board cease for any reason to constitute at least a majority
thereof, unless the Board in existence immediately preceding
the two year period shall have nominated the new Directors
whose Directorships have create the altered Board composition;
or
(iii) if the stockholders of the Company shall
approve a plan of merger, consolidation, reorganization,
liquidation or dissolution in which the Company does not
survive (unless the merger, consolidation, reorganization,
liquidation or dissolution is subsequently abandoned)
provided, however, that a merger or reorganization pursuant to
which the Company merges with a Subsidiary which is owned
principally by the Company's pre-merger or reorganization
shareholders and which becomes publicly traded within five (5)
business days thereafter shall not trigger immediate
exercisability under this Section 7; or
(iv) if the stockholders of the Company shall approve
a plan for the sale, lease, exchange or other disposition of
all or substantially all of the property and assets of the
Company (unless such approved plan is subsequently abandoned).
(c) The Committee may in its sole discretion accelerate the
date on which any Option may be exercised.
8. TERMINATION OF OPTION PERIOD.
(a) The unexercised portion of any Option shall automatically
and without notice terminate and become null and void at the time of
the earliest to occur of the following:
(i) one week after the date on which the Grantee's
employment is terminated for any reason other than by reason
of (A) cause (which, for purposes of this Plan, shall mean the
termination of the Grantee's employment by reason of the
Grantee's willful misconduct or gross negligence), (B) a
mental or physical disability as determined by a medical
doctor satisfactory to the Committee, or (C) death; provided,
however, that the one week period may be extended by the
Committee to up to three (3) months with respect to Incentive
Stock Options and up to thirty six (36) months in the case of
Non-qualified Stock Options;
(ii) immediately upon termination of the Grantee's
employment for cause, provided, however, that the Committee
may extend the period to up to three (3) months with respect
to Incentive Stock Options and up to thirty six (36) months in
the case of Non-qualified Stock Options;
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(iii) six months after the date on which the
Grantee's employment is terminated by reason of mental or
physical disability as determined by a medical doctor
satisfactory to the Committee, provided, however, that the
Committee may extend the period to up to thirty six (36)
months in respect to Non-qualified Stock Options;
(iv) (A) twelve months after the date of termination
of the Grantee's employment by reason of death of the Grantee,
or (B) three months after the date on which the Grantee shall
die if such death shall occur during the six (6) month period
specified in Subsection 8(a)(iii) hereof, provided, however,
that the Committee may extend the period to up to thirty six
(36) months in respect to Non-qualified Stock Options.
(b) The Committee in its sole discretion may by giving written
notice ("cancellation notice") cancel, effective upon the date of the
consummation of any corporate transaction described in Subsections
7(b)(iii) or (iv) hereof, any Option that remains unexercised on such
date. Such cancellation notice shall be given a reasonable period of
time prior to the proposed date of such cancellation and may be given
either before or after stockholder approval of such corporate
transaction.
9. ADJUSTMENT OF SHARES.
(a) If, at any time while the Plan is in effect or unexercised
Options are outstanding, there shall be any increase or decrease in the
number of issued and outstanding Shares through the declaration of a
stock dividend or through any recapitalization resulting in a stock
split-up, combination or exchange of Shares, then and in such event:
(i) appropriate adjustment shall be made in the
maximum number of Shares available for grant under the Plan
(including, but not limited to, shares permitted to be granted
to any one individual employee), so that the same percentage
of the Company's issued and outstanding Shares shall continue
to be subject to being so optioned; and
(ii) appropriate adjustment shall be made in the
number of Shares and the option price per Share thereof then
subject to any outstanding Option, so that the same percentage
of the Company's issued and outstanding Shares shall remain
subject to purchase at the same aggregate option price.
(b) Subject to the specific terms of any Option agreement, the
Committee may change the terms of Options outstanding under this Plan
with respect to the option price or the number of Shares subject to the
Options, or both, when, in the Committee's sole discretion, such
adjustments become appropriate by reason of a corporate transaction
described in Subsections 7(b)(iii) or (iv) hereof.
(c) Except as otherwise expressly provided herein, the
issuance by the Company of shares of its capital stock of any class, or
securities convertible into shares of capital stock of any class,
either in connection with direct sale or 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, shall not affect, and no adjustment by reason thereof shall
be made with respect to the number of or option price of Shares then
subject to outstanding Options granted under this Plan.
(d) Without limiting the generality of the foregoing, the
existence of outstanding Options granted under the Plan shall not
affect in any manner the right or power of the Company to make,
authorize or consummate (i) any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or
its business; (ii) any merger or consolidation of the Company; (iii)
any issuance by the Company of debt securities or preferred or
preference stock that would rank above the Shares subject to
outstanding Options; (iv) the dissolution or liquidation of the
Company; (v) any sale, transfer or assignment of all or any part of the
assets or business of the Company; or (vi) any other corporate act or
proceeding, whether of a similar character or otherwise.
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10. TRANSFERABILITY OF OPTIONS. Each Option agreement shall provide
that the Option shall not be transferable by the Grantee otherwise than by will
or the laws of descent and distribution or, in the case of Nonqualified Stock
Options, pursuant to a qualified domestic relations order as defined by the
Internal Revenue Code or Title I of the Employee Retirement Income Security Act,
or the rules thereunder; provided, however, that the Committee may waive the
foregoing transferability restriction with respect to Non-qualified Stock
Options on a case-by-case basis.
11. ISSUANCE OF SHARES. As a condition of any sale or issuance of
Shares upon exercise of any Option, the Committee may require such arrangement
or undertakings, if any, as the Committee may deem necessary or advisable to
ensure compliance with any applicable federal or state securities law or
regulation, including, but not limited to, the following:
(i) a representation and warranty by the Grantee to
the Company, at the time any Option is exercised, that he is
acquiring the Shares to be issued to him for investment and
not with a view to, or for sale in connection with, the
distribution of any such Shares; and
(ii) a representation, warranty and/or agreement to
be bound by any legends that are, in the opinion of the
Committee, necessary or appropriate to comply with the
provisions of any securities laws deemed by the Committee to
be applicable to the issuance of the Shares and are endorsed
upon the Share certificates.
12. ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by a stock option committee
(herein called the "Committee") consisting of not less than two (2)
Directors, all of whom shall be Disinterested Persons; provided,
however, that if no Committee is appointed, the Board may administer
the Plan provided that all members of the Board at the time are
Disinterested Persons. The Committee shall have all of the powers of
the Board with respect to the Plan. Any member of the Committee may be
removed at any time, with or without cause, by resolution of the Board,
and any vacancy occurring in the membership of the Committee may be
filled by appointment of the Board.
(b) The Committee, from time to time, may adopt rules and
regulations for carrying out the purposes f the Plan. The
determinations and the interpretation and construction of any provision
of the Plan by the Committee shall be final and conclusive.
(c) Any and all decisions or determinations of the Committee
shall be made either (i) by a majority vote of the members of the
Committee at a meeting or (ii) without a meeting by the unanimous
written approval of the members of the Committee.
13. INTERPRETATION.
(a) If any provision of the Plan should be held invalid for
any reason, such holding shall not affect the remaining provisions
hereof, but instead the Plan shall be construed and enforced as if such
provision had never been included in the Plan.
(b) This Plan shall be governed by the laws of the State of
Florida.
(c) Headings contained in this Plan are for convenience only
and shall in no manner be construed as part of this Plan.
(d) Any reference to the masculine, feminine, or neuter gender
shall be a reference to such other gender as is appropriate.
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14. AMENDMENT AND DISCONTINUATION OF THE PLAN. The Committee may from
time to time amend the Plan or any Option consistent with the Plan; provided,
however, that (except to the extent provided in Section 9) no such amendment
may, without approval by the stockholders of the Company, (a) increase the
number of Shares reserved for Options, (b) change the requirements for
eligibility to receive Options, or (c) materially increase the benefits accruing
to the participants under the Plan; and provided, further, that (except to the
extent provided in Section 8) no amendment or suspension of the Plan or any
Option issued hereunder shall substantially impair any Option previously granted
to any Grantee without the consent of such Grantee.
15. EFFECTIVE DATE AND TERMINATION DATE. The effective date of this
Plan shall be March 17, 1993 provided that the Plan is approved by the Company's
Stockholder(s), and the Plan shall terminate on the tenth (10th) anniversary of
the effective date. After such termination date, no Options may be granted
hereunder; provided, however, that Options outstanding at such date may be
exercised pursuant to their terms.
Dated as of the 18TH HEICO CORPORATION
day of MARCH, 1997.
By: /S/ LAURANS A. MENDELSON
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Laurans A. Mendelson
Chairman, President and
Chief Executive Officer
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