Exhibit 99(a)
Amended, Restated and Renewed
as of February 11, 1997
SEI INVESTMENTS COMPANY
STOCK OPTION PLAN
1. Background.
The Board of Directors of SEI Investments Company (formerly known as SEI
Corporation), a Pennsylvania corporation (the "Company"), by resolution dated
January 21, 1981, adopted the Stock Option Plan (the "Plan") providing for the
grant of stock options for the purchase of shares of Non-Voting Common Stock of
the Company, which shares were subsequently converted to Common Stock, par value
$.01 (the "Shares"), to employees of the Company and its subsidiaries. The Plan
was initially approved by the shareholders of the Company on February 9, 1981.
The Plan has been subsequently amended and restated from time to time by all
requisite action of the Board of Directors and shareholders of the Company. The
Plan was again amended and restated by action by the Board of Directors on
February 11, 1997, subject to approval by shareholders of the Company.
2. Purpose of Plan.
The purpose of the Plan is to allow for the issuance thereunder of
Incentive Stock Options and Non-Qualified Options in order to provide an
additional means through which the Company can attract and retain employees and
consultants. The Company believes that the Plan will encourage the participants
to contribute materially to the growth of the Company, thereby benefitting the
Company's shareholders, and will align the economic interests of the
participants with those of the shareholders.
3. Administration of the Plan.
(a) Committee. The Plan shall be administered and interpreted by a Stock
Option Committee (the "Committee"). The Committee shall consist of two or more
persons appointed by the Board of Directors, all of whom shall be "outside
directors" as defined under section 162(m) of the Internal Revenue Code of 1986,
as amended (the "Code") and related Treasury regulations and "non-employee
directors" as defined under Rule 16b-3 under the Securities Exchange Act of
1934, as amended (the "Exchange Act").
(b) Committee Authority. The Committee shall have the sole authority to
(i) determine the individuals to whom grants shall be made under the Plan, (ii)
determine the type, size and terms of the grants to be made to each such
individual, (iii) determine the time when the grants will be made and the
duration of any applicable exercise period, including the criteria for
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exercisability and the acceleration of exercisability and (iv) deal with any
other matters arising under the Plan.
(c) Committee Determinations. The Committee shall have full power and
authority to administer and interpret the Plan, to make factual determinations
and to adopt or amend such rules, regulations, agreements and instruments for
implementing the Plan and for the conduct of its business as it deems necessary
or advisable, in its sole discretion. The Committee's interpretations of the
Plan and all determinations made by the Committee pursuant to the powers vested
in it hereunder shall be conclusive and binding on all persons having any
interest in the Plan or in any awards granted hereunder. All powers of the
Committee shall be executed in its sole discretion, in the best interest of the
Company, not as a fiduciary, and in keeping with the objectives of the Plan and
need not be uniform as to similarly situated individuals.
4. Shares Subject to the Plan.
(a) Plan Share Limits. The maximum aggregate number of Shares with respect
to which options may be granted from time to time under the Plan (subject to the
provisions of Section 12) shall be 12,304,988 Shares. The maximum aggregate
number of Shares that shall be subject to grants made under the Plan to any
individual during any calendar year shall be 25,000 Shares.
(b) Other Share Requirements. If an option granted under the Plan ceases
to be exercisable in whole or in part by reason of (i) the expiration of the
term of the option; (ii) the cancellation of the option with the consent of the
optionee; (iii) upon or following termination of employment of the optionee in
accordance with Section 10; or (iv) the forfeiture, exchange or surrender of the
option, the Shares which were subject to such option, but to which the option
had not been exercised at the time of termination of the option, shall continue
to be available under the Plan. The Shares to be issued upon exercise of options
granted under the Plan shall be either authorized but unissued Shares or Shares
reacquired by the Company and held in the treasury of the Company, including
Shares purchased by the Company on the open market for purposes of the Plan.
5. Designation of Participants
(a) Eligible Individuals. Employees of the Company, and affiliates of the
Company, shall be eligible to receive options under the Plan. Consultants who
perform services to the Company or any of its affiliates shall be eligible to
participate in the Plan if the consultants render bona fide services and such
services are not in connection with the offer or sale of securities in a
capital-raising transaction. Notwithstanding the foregoing, only employees of
the Company or its subsidiaries shall be eligible to receive Incentive Stock
Options.
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(b) Selection of Optionees. From time to time, the Committee shall
designate from such eligible persons those who will receive options and the
number of Shares to be covered by each option.
(c) Rights of Participants. Nothing in the Plan shall entitle any
employee, consultant or other person to any claim or right to be granted an
option under this Plan. Nothing in this Plan, in any option granted pursuant to
this Plan, or in any action taken hereunder shall be construed as conferring on
any individual any rights to continue in the employ (or as a consultant) of the
Company or any of its subsidiaries, or any other employment (or consulting)
rights. Nothing in the Plan or in any option granted pursuant to this Plan shall
in any way interfere with the right of the Company or any of its subsidiaries to
terminate the optionee's employment (or consulting relationship) at any time.
Options may be granted to eligible persons whether or not they hold or have held
options under the Plan or under plans or arrangements previously adopted by the
Company.
(d) Definitions. For the purposes of the Plan, the term "subsidiary" shall
mean any corporation now existing or hereafter organized or acquired by the
Company in an unbroken chain of corporations beginning with the Company if, at
the time of the granting of the option, each of the corporations (including the
Company) other than the last corporation in the unbroken chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one or the other corporations, in such chain. The term
"affiliate" shall mean any corporation, partnership or other entity in which the
Company holds, directly or indirectly, fifty percent (50%) or more of the
entity's equity interest.
6. Types of Options.
Options granted under the Plan may be of two types: (a) options intended to
meet the requirements of section 422 of the Code ("Incentive Stock Options") and
(b) options not intended to meet the requirements of section 422 of the Code
("Non-Qualified Options"). The Committee shall have authority and discretion to
grant to an eligible person either Incentive Stock Options, Non-Qualified
Options or both but shall clearly designate the nature of each option at the
time of option grant.
7. Stock Option Agreement.
Each option granted under the Plan shall be subject to the terms and
conditions set forth herein and shall be evidenced by a stock option agreement,
which shall be executed by the Company. The agreement shall contain such terms
and provisions, not inconsistent with the Plan, as shall be determined by the
Committee, including (a) a clear designation of the status of the options
granted thereby; and (b) in the case of Incentive Stock Options such terms as
shall be requisite to cause such options to comply with the provisions of
section 422 of the Code. The Committee shall approve the form and provisions of
each stock option agreement, and any amendment thereto. Incentive Stock Options
and Non-Qualified Options may be granted
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simultaneously and subject to a single option agreement, provided that, in no
event shall a Non-Qualified Option be granted in tandem with an Incentive Stock
Option, such that the exercise of one affects the right to exercise the other.
The terms and provisions of such option agreements may vary between optionees
and between different options granted to the same optionee. By accepting any
option granted under the Plan, an optionee will be deemed to have agreed to all
provisions contained in the option agreement.
8. Option Price.
(a) Determination of Option Price. The option price shall be determined by
the Committee and shall be not less than the Fair Market Value (as defined
below) of the Shares at the time the option is granted provided; however, that
the option price of Shares with respect to Incentive Stock Options granted to
any person possessing (at the time of option grant) over ten percent of the
total combined voting power of all classes of stock of the Company and any
parent and subsidiary corporations (such person hereinafter a "control person")
shall be 110% of such Fair Market Value of a Share on the date the Incentive
Stock Option is granted.
(b) Determination of Fair Market Value. For the purposes of this Plan, the
Fair Market Value of the Shares shall mean the average (mean) of the closing bid
and asked prices of the Shares as reported on the relevant date through the
National Association of Securities Dealers Automated Quotation System or, if the
Shares are listed or admitted to trading on the Nasdaq National Market System or
any national securities exchange or if the last reported sale price of such
Shares is generally available, the last reported sale price on such system or
exchange on the relevant date. The Fair Market Value for any day for which
there is no such bid and asked price or last reported sales price shall be the
Fair Market Value of the next preceding day for which there is such a price.
Should the Shares be traded otherwise than on the markets referred to
above, then the Fair Market Value shall be determined by the Committee. If the
Shares are not publicly traded, then the Fair Market Value shall be not less
than the value established for the Shares by an independent appraisal as of a
date not more than twelve months before such value determination by the
Committee.
9. Amount of Incentive Stock Options.
With respect to Incentive Stock Options granted after December 31, 1986, if
the aggregate Fair Market Value (determined as of the time of option grant) of
the Shares with respect to which such Incentive Stock Options first become
exercisable during any calendar year under this Plan and any other plan of the
Company or any parent or subsidiary, exceeds $100,000, then such Incentive Stock
Options, to the extent of such excess, shall be treated for all tax purposes as
Non-Qualified Options.
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10. Terms of Options.
The Committee shall have the authority to determine the term of each
option, provided that no Incentive Stock Option granted to a control person
shall be exercisable after the expiration of five (5) years from the date of
option grant and no other option shall be exercisable after the expiration of
ten (10) years from the date of option grant. Subject to the limitation periods
hereinabove set forth, no option, or portion thereof, granted under the Plan
shall vest after the optionee ceases to be employed by (and is employed by
neither) the Company or one of its subsidiaries or affiliates (a "termination of
employment") and all options shall terminate automatically on the earliest to
occur of the expiration of the option term (as described above), or one of the
following events:
a. Upon the expiration of ten (10) days after notice by the Company
pursuant to Section 12(d) of the sale of all or substantially all of its assets;
b. Thirty (30) days after a termination of employment (or within such
other period of time as may be specified by the Committee) for any reason other
than death, retirement or disability;
c. One year from the date of a termination of employment (or within such
other period of time as may be specified by the Committee) by reason of the
optionee's death;
d. Three months from the date of a termination of employment (or within
such other period of time as may be specified by the Committee) by reason of the
optionee's disability or retirement; or
e. As of the date of a termination of employment by reason of a
termination for cause.
For purpose of determining whether or not a termination of employment has
occurred, (i) the transfer of an optionee among the Company or any subsidiary or
affiliate shall not be deemed a termination of employment, (ii) the sale of any
subsidiary or affiliate to an unaffiliated party shall be deemed a termination
of employment of any optionee who continues to be employed by such subsidiary or
affiliate subsequent to such sale, (iii) a consultant shall be deemed to have
incurred a termination of employment at the time he is no longer required to
perform services for the Company or any subsidiary or affiliate, as determined
by the Committee, (iv) an optionee shall be deemed to have been terminated for
cause if the Committee finds that the optionee has breached his employment or
service contract with the Company, any subsidiary or affiliate, or has been
engaged in disloyalty to the Company, any subsidiary or affiliate, including,
without limitation, fraud, embezzlement, theft, commission of a felony or proven
dishonesty in the course of his employment or service, or has disclosed trade
secrets or confidential information of the Company, any subsidiary or affiliate
to persons not entitled to receive such information, and (v)
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an optionee shall be deemed to be disabled if the optionee becomes disabled
within the meaning of section 22(e)(3) of the Code. Notwithstanding the
foregoing, with respect to an option granted to a consultant, the Committee, in
its sole discretion, shall establish the provisions concerning termination of
such option at the time of option grant. In the absence of such establishment,
the provisions of (a) through (e) above shall apply.
11. Exercise of Options.
(a) Exercisability of Options. The time or times at which or during which
options granted under this Plan may be exercised, and any conditions pertaining
to such exercise, shall be determined by the Committee and specified in the
stock option agreement or an amendment to the stock option agreement; provided
however, that no Incentive Stock Option granted on or before December 31, 1986
shall become exercisable while the optionee has outstanding any previously
granted incentive stock option (as defined in section 422 of the Code) to
purchase stock in the Company, in a corporation that (at the time of option
grant) was a parent or subsidiary of the Company or in a predecessor corporation
of any of such corporations.
(b) Transferability of Options.
(i) Nontransferability of Options. Except as provided below, no
option granted under this Plan shall be assignable or otherwise transferable
except by will or the laws of descent and distribution or, with respect to Non-
Qualified Options, if permitted in any specific case by the Committee, pursuant
to a domestic relations order (as defined under the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended, or the regulations
thereunder). Any option shall be exercisable solely by the optionee during the
lifetime of the optionee and, after the death of the optionee, an option shall
be exercisable (subject to the provision of Section 10) solely by either the
duly qualified personal representative or representatives of the optionee, or
the person or persons who acquire the right to exercise such option by will or
the laws of descent and distribution and such person or persons furnish proof
satisfactory to the Company of his or their right to receive the option under
the optionee's will or under the applicable laws of descent and distribution.
(ii) Transfer of Non-Qualified Options. Notwithstanding the
foregoing, the Committee may provide, in a stock option agreement, that an
optionee may transfer Non-Qualified Options to family members or other persons
or entities according to such terms as the Committee may determine; provided
that the optionee receives no consideration for the transfer of a Non-Qualified
Option and the transferred Option shall continue to be subject to the same terms
and conditions as were applicable to the Option immediately before the transfer.
(c) Payment of Option Price. The purchase price of the Shares as to which
an option is exercised shall be paid in full in cash or in any other manner
approved by the Committee which may include, but shall not be limited to,
payment by surrender of unrestricted Shares owned by the optionee (including
Shares acquired in connection with the exercise of the option,
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subject to such restrictions as the Committee deems appropriate) and having a
Fair Market Value on the date of exercise equal to the purchase price, or
payment through a broker in accordance with procedures permitted by Regulation T
of the Federal Reserve Board. The optionee shall pay the option price and the
amount of any withholding tax due (pursuant to Subsection (d)) at the time of
exercise.
(d) Withholding of Taxes.
(i) Required Withholding. All options under the Plan shall be subject
to applicable federal (including FICA), state and local tax withholding
requirements. The Company may require the optionee or other person receiving
such Shares to pay to the Company the amount of any such taxes that the Company
is required to withhold with respect to the exercise of such options, or the
Company may deduct from other wages paid by the Company the amount of any
withholding taxes due with respect to such exercise.
(ii) Withholding Shares. If the Company is required to withhold any
taxes arising from an exercise of options under the Plan, the Treasurer of the
Company may, in such person's discretion, withhold delivery of Shares issuable
upon exercise of an option in an amount (valued at the Fair Market Value of such
Shares on the date of exercise of the option) sufficient to cover the Company's
withholding obligation with respect to such taxes.
(e) Notice of Exercise. Notice in writing shall be given by the optionee
to the Treasurer of the Company, or such other person as may be designated from
time to time by the Treasurer, on any day on which the offices of the Company
are generally open for the conduct of business, which notice shall indicate the
exercise of any option and specify the number of Shares desired at the option
price.
(f) Limitations on Issuance of Shares. The obligation of the Company to
deliver Shares upon such exercise shall be subject to all applicable laws,
rules, regulations, and such approvals by governmental agencies as may be deemed
appropriate by the Committee, including, among others, such steps as counsel for
the Company shall be deem necessary or appropriate to comply with requirements
of relevant securities laws. Such obligation shall also be subject to the
condition that the Shares reserved for issuance upon the exercise of options
granted under the Plan shall have been duly listed on any national securities
exchange which then constitutes the principal trading market for the Shares.
12. Capital Change of the Company.
(a) Adjustments. In the event that there is a change in, reclassification
of, subdivision of, combination of, split-up or spin-off with respect to, stock
dividend on, or exchange of stock of the Company for the outstanding Shares of
the Company, the maximum aggregate number and class of Shares as to which
options may be granted under the Plan, the maximum aggregate number of Shares
that any individual participating in the Plan may be granted in any calendar
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year, and the number and class of Shares as to which each outstanding option and
the option price may (but need not) be adjusted by the Committee in any manner
in which the Committee, in is absolute discretion, deems appropriate. Such
adjustment to Shares subject to the Plan or to Shares subject to options under
the Plan shall not in any event take place with respect to any dividend payable
in Shares of the Company, unless such dividend would result in either (i) an
increase of ten percent (10%) or more in the outstanding Shares of the Company
since the adoption of the Plan or the grant of the subject option thereunder, as
the case may be; or (ii) an increase in any one transaction of five percent (5%)
or more in the outstanding Shares.
(b) Consolidation or Merger of the Company. If the Company shall be
consolidated or merged with another corporation, each optionee who has an
outstanding option hereunder shall, at the time for issuance of Shares upon
exercise or partial exercise of such option, be entitled to receive the same
number and kind of shares, or the same amount of other property, cash, or
securities as the optionee would have been entitled to receive upon the
happening of such consolidation or merger if the optionee had been, immediately
prior to such event, the holder of the number of Shares to which the optionee
has an outstanding option hereunder (to the extent of such exercise or partial
exercise) adjusted in the manner provided in this Section, or, if another
corporation shall be the survivor, such other corporation shall substitute
therefor a substantially equivalent number and kind of shares of stock or other
property, cash, or securities of such other corporation. Notwithstanding
anything in the Plan to the contrary, in the event of a consolidation or merger
described above, the Committee shall not have the right to take any actions
described in the Plan that would make the consolidation or merger ineligible for
pooling of interests accounting treatment or that would make the consolidation
or merger ineligible for desired tax treatment if, in the absence of such right,
the consolidation or merger would qualify for such treatment and the Company
intends to use such treatment with respect to the consolidation or merger.
(c) Further Adjustments. In the event that there shall be any change,
other then as specified above, in the number or kind of the outstanding Shares
or of any stock or other securities into which such Shares shall have been
changed or for which they shall have been exchanged, or in the event of a
dividend to holders of the Shares payable other than in cash or stock of the
Company, then if the Committee shall determine that such change equitably
requires an adjustment in the number or kind of Shares theretofore appropriated
for the purposes of the Plan but not yet covered by an option, an adjustment in
the number or kind of Shares that may be granted to any individual during any
calendar year under the limit set forth in Section 4 of the Plan, or an
adjustment with respect to the number, price or kind of Shares then subject to
an option or options, such adjustment shall be made and shall be effective and
binding for all purposes of the Plan.
(d) Sale of Substantially all Assets. Notwithstanding the above, if all or
substantially all of the assets of the Company shall be sold or exchanged
(otherwise than by merger or consolidation), each optionee shall have the right
to exercise such option in full, to the extent that
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it has not previously been exercised within ten (10) days after the notice by
the Company of the right to exercise, and any such option not so exercised shall
lapse.
13. Termination and Amendment.
(a) Termination and Amendment of Plan. Unless the Plan shall theretofore
have been terminated as hereinafter provided, it shall terminate on, and no
option shall be granted thereunder after, January 1, 2001. The Board of
Directors may also terminate the Plan or make such modifications or amendments
thereof as it shall deem advisable; provided, however, that the Board of
Directors shall not, amend the Plan without further approval by the holders of a
majority of the outstanding common stock of the Company if such approval is
required by section 162(m) of the Code or such approval is required by section
422 of the Code.
(b) Termination and Amendment of Outstanding Options. The Committee may
authorize amendments of outstanding options including without limitation the
reduction of the option prices specified therein (or the granting of new options
at lower prices upon the cancellation of outstanding options), so long as all
options granted hereunder outstanding at any one time shall not call for
issuance of more shares of common stock than those provided in Section 4 hereof
and so long as the provisions of any amended option would have been permissible
under the Plan if such option had been originally granted as of the date of such
amendment with such amended terms. No termination, modification, or amendment
of this Plan may adversely affect any then outstanding option under such Plan
without the consent of the person to whom such option has been granted. Whether
or not the Plan has terminated, an outstanding option may be terminated or
amended under Section 18(c) or may be amended by agreement of the Company and
the optionee consistent with the Plan.
(c) Governing Document. The Plan shall be the controlling document. No
other statements, representations, explanatory materials or examples, oral or
written, may amend the Plan in any manner. The Plan shall be binding upon and
enforceable against the Company and its successors and assigns.
14. Funding of the Plan.
This Plan shall be unfunded. The Company shall not be required to
establish any special or separate fund or to make any other segregation of
assets to assure the payment of grants under this Plan. In no event shall
interest be paid or accrued on any grant.
15. No Fractional Shares
No fractional Shares shall be issued or delivered pursuant to the Plan or
any option. The Committee shall determine whether cash, other awards or other
property shall be issued or paid in lieu of such fractional shares or whether
such fractional shares or any rights thereto shall be forfeited or otherwise
eliminated.
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16. Headings.
Section headings are for reference only. In the event of a conflict
between a title and the content of a Section, the content of the Section shall
control.
17. Effective Date.
Subject to the approval of the Company's shareholders, the Plan, as amended
and restated, shall be effective on February 11, 1997.
18. Miscellaneous.
(a) Grants in Connection with Corporate Transactions and Otherwise.
Nothing contained in this Plan shall be construed to (i) limit the right of the
Committee to make grants under this Plan in connection with the acquisition, by
purchase, lease, merger, consolidation or otherwise, of the business or assets
of any corporation, firm or association, including options to employees thereof
who become employees of the Company, or for other proper corporate purposes, or
(ii) limit the right of the Company to grant stock options or make other awards
outside of this Plan. Without limiting the foregoing, the Committee may make a
grant to an employee of another corporation who becomes an employee by reason of
a corporate merger, consolidation, acquisition of stock or property,
reorganization or liquidation involving the Company or any of its subsidiaries
in substitution for a stock option or restricted stock grant made by such
corporation. The terms and conditions of the substitute grants may vary from
the terms and conditions required by the Plan and from those of the substituted
stock incentives. The Committee shall prescribe the provisions of the
substitute grants.
(b) Rights of an Optionee. No optionee shall have any rights of a
shareholder with respect to any Shares unless and until the optionee has
exercised the option with respect to such Shares and has paid the full option
price therefor.
(c) Compliance with Law. The Plan and the exercise of options shall be
subject to all applicable laws and to approvals by any governmental or
regulatory agency as may be required. With respect to persons subject to section
16 of the Exchange Act, it is the intent of the Company that the Plan and all
transactions under the Plan comply with all applicable provisions of Rule 16b-3
or its successors under the Exchange Act. The Committee may revoke any grant if
it is contrary to law or modify a grant to bring it into compliance with any
valid and mandatory government regulation. The Committee may also adopt rules
regarding the withholding of taxes on payments to optionees. The Committee may,
in its sole discretion, agree to limit its authority under this Section.
(d) Governing Law. The validity, construction, interpretation and effect
of the Plan and stock option agreements issued under the Plan shall exclusively
be governed by and determined in accordance with the law of the Commonwealth of
Pennsylvania, to the extent such law is not superseded by or inconsistent with
Federal law.
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