Exhibit 10.18
TYCO INTERNATIONAL LTD.
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THE RULES OF THE
UK SAVINGS-RELATED SHARE OPTION PLAN
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ADOPTED BY THE COMPANY ON 3 NOVEMBER 1999
RECEIVED FORMAL APPROVAL UNDER SCHEDULE 9 TO THE INCOME AND
CORPORATION TAXES ACT 1988 BY THE BOARD OF INLAND REVENUE
ON 5 JANAURY 2000 UNDER REFERENCE
PricewaterhouseCoopers
Plumtree Court
London
EC4A 4HT
1
TYCO INTERNATIONAL LTD
UK SAVINGS-RELATED SHARE OPTION PLAN
CONTENTS
RULE
1. INTERPRETATION AND CONSTRUCTION
Definitions (a)
Construction (b) to (d) / /
2. COMMON SHARE CAPITAL
Availability of authorised share capital (a)
Variation of share capital and adjustment of options (b)
3. APPLICATIONS FOR OPTIONS
4. GRANT OF OPTIONS
Contributions under the savings contract (a)
Timing of grant (b)
Grant of options / / Option certificates (c) to (e)
Options only to be granted to employees and directors (f)
Life of the Plan (g)
(h)
5. NON-TRANSFERABILITY OF OPTIONS / /
6. RIGHTS TO EXERCISE OPTIONS
General (a)
Death (b)
Cessation of employment in special circumstances (c) and (d)
Reaching specified age (e)
Employee Transferred to other member of the Group (f)
Cessation of employment in other circumstances (g)
Termination of savings contract (h)
Bankruptcy (i)
Conditions to be satisfied at time of exercise (j)
Exercise to be limited to repayment proceeds (k)
7. LOSS OF OFFICE OR EMPLOYMENT
8. TAKEOVERS, RECONSTRUCTION, AMALGAMATION &
LIQUIDATION
Change in control of the company - acquirng company (a) to (d)
Change in control of the company - acquiring person (e)
Change in control of the company - additional provisions for compromises (f) to (j)
Plan shares ceasing to satisfy paragraphs 10 to 14 of Schedule 9 (k)
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Liquidation (l)
9. EXERCISE OF OPTIONS AND LISTING OF SHARES
Procedures on exercise (a) and (b)
Rights attaching to Plan shares (c)
Listing (d)
10. PLAN AMENDMENTS AND TERMINATION
Amendments (a) to (f)
Termination (g)
11. ADMINISTRATION
Notice and documents (a) to (c)
Disputes (d)
Costs of the Plan (e)
Governing law (f)
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TYCO INTERNATIONAL LTD
UK SAVINGS-RELATED SHARE OPTION PLAN
RULES
1. INTERPRETATION AND CONSTRUCTION
DEFINITIONS
(a) In the Rules of this Plan unless the context otherwise requires the
following words and expressions shall have the following meanings:
Acquiring Company Any company which:
(a) has obtained Control of the
Company either:
(i) as a result of making a
Takeover Offer; or
(ii) in pursuance of a Compromise;
or
(b) becomes bound or entitled to
acquire Plan Shares on the terms
of an offer contained in Section
102 Notice(s);
Acquiring Person Any person, not being an Acquiring
Company who:
(a) either alone or together with any
person acting in concert with him
has obtained Control of the
Company as a result of making a
Takeover Offer or otherwise; or
(b) having Control of the Company,
makes a general offer to acquire
all of the common shares in issue
in the capital of the Company
(other than those that are already
owned by him and/or by any person
acting in concert with him);
Acquisition Price The amount payable in relation to the
exercise of an Option, being the
amount (after any adjustment pursuant
to Rule 2(b)) of the Option Price
multiplied by the number of Plan
Shares in respect of which the Option
is exercised;
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the Act The Income and Corporation Taxes
Act 1988;
Adoption Date The date on which this Plan is
adopted by the Company;
Appropriate Period In relation to:
(a) a Takeover Offer, means the period
of 6 months beginning with the
time when the person making the
Takeover Offer has obtained
Control of the Company and any
condition subject to which the
Takeover Offer is made is
satisfied;
(b) a Compromise means:
(i) where the Option is to be
exercised the period permitted
in the operation of Rules 8(f)
to 8(j);
(ii) where the Option is to be
Rolled- over the period of 6
months beginning with the time
when the court sanctions the
Compromise;
(c) a Section 102 Notice means the
period during which the Acquiring
Company is entitled and bound to
acquire shares on the terms of the
offer contained in such Section
102 Notice, and;
(d) an Acquiring Person who obtains
Control of the Company, or who
having Control of the Company
makes a general offer for all of
the common shares in issue in the
capital of the Company, (other
than those which are already owned
by him and/or any person acting in
concert with him), means the
period of six months beginning
with the time when the Acquiring
Person obtains Control or makes
the offer as the case may be;
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Associated Company A company which has control of, or is
under the control of, the Company or
which is under the control of the same
person as the Company is controlled
by, provided that for these purposes
"control" shall have the meaning given
by section 416 of the Act;
Bonus Any sum payable by way of terminal
bonus under a Savings Contract, being
the additional payment made by the
Savings Authority when repaying
contributions made under a completed
Savings Contract;
Bonus Date In relation to any Eligible Employee's
(or Normal Maturity Date) Savings Contract the earliest date on
which a Standard Bonus is due or where
the Option- holder has indicated that
he intends to enter into a 5-year
Savings Contract and to seek the
Maximum Bonus, the earliest date on
which that Maximum Bonus is due;
Committee The Board of Directors of the Company
or a duly authorised committee of the
Board of Directors;
the Companies Act The Companies Act 1981 of Bermuda;
the Company Tyco International Ltd.;
Compromise In relation to the Company, means a
compromise or arrangement sanctioned
or to be sanctioned by the court under
section 101 of the Companies Act;
Control Control as defined in section 840 of
the Act;
Date of Grant The date on which an Option is granted
to an Eligible Employee, which shall
be the date specified on the Option
Certificate;
Eligible Employee (a) Any person who is not prohibited
from participating in this Plan by
reason of the provisions of
paragraph 8 of Schedule 9 and who:
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(i) is an employee or director
(other than a non-executive
director) of a Group Company;
and
(ii) if a director, is contracted
to work at least 25 hours a
week (exclusive of meal
breaks) for the Group; and
who in either case:
(aa) is chargeable to tax in
respect of his office or
employment under Case I
of Schedule E; and
(ab) was employed by the
Company for at least one
month prior to the
Invitation Date;
(b) is any other director or employee
of a Group Company who is not
prohibited from participating by
reason of paragraph 8 of Schedule
9 and, in the case of a director,
who satisfies (a)(ii) above, whom
the Committee in their sole
discretion approve;
Exchange Rate The average conversion rate for U.S.
dollars to Pounds Sterling as listed
in THE WALL STREET JOURNAL over the
same period as the Market Value is
determined;
Group The Company and its Subsidiaries from
time to time and the expression
"member of the Group" shall be
construed accordingly;
Group Company The Company, or a company which is for
the time being a Subsidiary over which
the Company has Control and which has
been nominated by the Committee to
participate for the time being in this
Plan;
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Invitation An invitation to apply for the grant
of an Option pursuant to Rule 3(a);
Invitation Date In respect of any Option grant, the
date on which an invitation is made by
the Committee pursuant to Rule 3(a);
London Stock Exchange The London Stock Exchange Limited or
any successor body;
Market Value In the case of Options granted under
this Plan, means the market value of a
Plan Share determined by the Committee
in accordance with any one of the
following;
(i) the closing price of a Plan Share
on the New York Stock Exchange, on
the Invitation Date; or
(ii) the closing price of a Plan Share
on the New York Stock Exchange, on
the last trading day preceding the
Invitation Date; or
(iii) the average of the composite
closing price of a Plan Share on
the New York Stock Exchange (as
reported by Bloomberg) for the
3-trading day period preceding the
Invitation Date; or
(iv) such other value as may be agreed
with the Share Valuation Division
of the Inland Revenue on or before
the Invitation Date.
The Market Value denoted in US$ will
be converted to pounds sterling
using the Exchange Rate.
Maximum Bonus The Bonus which is payable at the
earliest at the end of a period of 7
years from the starting date of
the Savings Contract;
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New York Stock Exchange (NYSE) The New York Stock Exchange or any
successor body;
Normal Retirement Date The age at which an employee is due to
retire in accordance with the terms of
his contract of employment;
Option A right to acquire Plan Shares at the
Acquisition Price granted to an
Eligible Employee under the provisions
of this Plan and for the time being
subsisting;
Option Certificate The certificate in respect of a grant
of an Option which shall be issued to
an Option-holder in accordance with
Rule 4(f);
Option-holder Any person who holds an Option, or
(where the context admits) his legal
personal representative(s);
Option Price The price per Plan Share determined by
the Committee being not less than the
greater of:
(i) the nominal value of a Plan Share;
and
(ii) 80 per cent of the Market Value
of such a Plan Share on the
Invitation Date or on such earlier
date or dates (the "Valuation
Date") as may be agreed in writing
with the Board of Inland Revenue;
Option Rollover In relation to an Option, means a
release by an Option-holder with the
consent of the Acquiring Company of
his rights ("old rights") under this
Plan in consideration of the grant to
him of rights ("new rights") which are
equivalent to the old rights but which
relate to shares in:
(a) the Acquiring Company; or
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(b) a company which has Control of the
Acquiring Company; or
(c) a company which either is, or has
Control of, a company which is a
member of a consortium within the
meaning of paragraph 10(c) of
Schedule 9
where the term "equivalent" shall be
construed in accordance with Rule
8(c);
this Plan The Tyco International Ltd. UK
Savings-Related Share Option Plan in
its present form or as from time to
time amended in accordance with the
provisions hereof;
Plan Shares Fully paid common shares in the
capital of the Company or any shares
representing the same which satisfy
the conditions specified in paragraphs
10 to 14 inclusive of Schedule 9;
Rolled-over The action of effecting an Option
Rollover or its completion;
the Rules The rules for the time being governing
this Plan;
Savings Authority A building society or an institution
authorised under the Banking Act 1987
to whom the Committee from time to
time determines that contributions are
payable under the terms of a Savings
Contract;
Savings Contract A contract under a certified
contractual savings scheme (within the
meaning of section 326 of the Act)
which has been approved by the
Committee for the purposes of this
Plan and by the Board of Inland
Revenue for the purposes of Schedule
9;
Schedule 9 Schedule 9 to the Act;
Section 102 Notice In relation to the Company, means a
notice served by a person who has
become entitled to serve such a
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notice on the shareholders of the
Company under section 102 of the
Companies Act;
Specified Age The age of 65 years;
Standard Bonus The Bonus payable under a 3-year or
5-year Savings Contract or the
earliest Bonus payable under a 5- year
Savings Contract as applicable;
Subsidiary A company which is a subsidiary of the
Company within the meaning of section
86 of the Companies Act;
Takeover Offer In relation to the Company, means
either:
(a) a general offer to acquire all of
the common shares in issue in the
capital of the Company which is
made on a condition such that if
it is satisfied the person making
the offer will have Control of the
Company; or
(b) a general offer to acquire all the
shares in the Company of the same
class as the Plan Shares;
Valid Application An application made by an Eligible
Employee on the application form
provided by the date specified in an
Invitation made in accordance with
Rule 3(a) as the latest date for
applications in which the monthly
contribution specified is permitted by
Rule 4(a).
CONSTRUCTION
(b) Words or expressions used herein shall where appropriate:
(i) when denoting the masculine gender include the feminine and
vice versa;
(ii) when denoting the singular include the plural and vice versa;
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(iii) unless otherwise defined herein or the context otherwise
requires have the same meanings as in Schedule 9 as amended
from time to time;
(iv) when referring to any enactment be construed as a reference to
that enactment as for the time being consolidated, amended,
re-enacted or replaced and shall include any regulations made
thereunder; and
(v) be construed such that the headings and sub-headings are for
ease of reference only, and do not affect the interpretation
of any Rule.
(c) For the purposes of any application of the provisions of this Plan
following an Option Rollover, Rules 1, 2, 6, 8, 11(a), 11(c) and 11(d)
shall only in relation to the new rights be construed as if the
following terms have the meanings assigned to them in this Rule 1(c)
and not the meaning assigned to them in Rule 1(a):
"Committee" The Board of Directors of the company in
respect of whose shares new rights have been
granted or a duly authorised committee
thereof;
"Company" The company in respect of whose shares new
rights have been granted;
"Plan Shares" Fully paid common shares in the
capital of the company for the time being
over whose shares new rights have been
granted and which satisfy the conditions
specified in paragraphs 10 to 14 inclusive of
Schedule 9.
(d) Where under any of the provisions of these Rules it is provided that an
Option shall lapse that Option shall cease to be exercisable thereafter
notwithstanding any other provision of these Rules.
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2. SHARE CAPITAL
AVAILABILITY OF AUTHORISED SHARE CAPITAL AND PLAN SHARES
(a) The Company shall at all times keep available sufficient authorised and
unissued Plan Shares or shall procure that sufficient Plan Shares are
available for transfer to satisfy the exercise to the full extent still
possible of all Options which have neither lapsed nor been fully
exercised taking account of any other obligations of the Company to
provide shares of the same class as Plan Shares.
VARIATION OF SHARE CAPITAL AND ADJUSTMENT OF OPTIONS
(b) In the event of any capitalisation issue or rights issue, rights offer
or any reduction, sub- division, consolidation or other variation of
the share capital of the Company, the number of Plan Shares comprised
in any Option and the Option Price may be adjusted by the Company
(including retrospective adjustments where appropriate) in such manner
as the Company considers to be in its opinion fair and reasonable
provided always that no adjustment shall have effect after the date of
adjustment for so long as the Plan is approved by the Board of Inland
Revenue, until the Board of Inland Revenue has approved the adjustment.
Except in the case of an Option over Plan Shares already in issue, no
adjustment shall be made which would cause the Option Price to be less
than the nominal value of that Plan Share. Notice of any such
adjustment shall be given to the Option-holders affected by such
adjustment by the Committee, who may call in Option certificates for
endorsement, cancellation or re-issue subsequent upon such adjustment.
(c) Where an Option subsists over both issued and unissued Plan Shares, the
adjustment permitted by Rule 2(b) may only be made if the reduction of
the Option Price of both issued and unissued Plan Shares may be made to
the same extent.
3. APPLICATIONS FOR OPTIONS
(a) Subject to the restrictions hereinafter contained, the Committee may,
in its absolute discretion, from time to time, announce its intention
to issue Invitations to Eligible Employees to apply for the grant of
Options under the Plan. If the Committee announces its intention to
issue Invitations, it shall issue an Invitation to every person who is
an Eligible Employee in whatever manner is determined by the Committee
to be appropriate, provided that the following details are included:
(i) the maximum number of Plan Shares over which Options are to be
granted on the Date of Grant immediately following such
Invitation;
(ii) the Option Price;
(iii) the last date by which applications made pursuant to Rule 3(b)
must be received (which shall be not earlier than 14 days nor
later than 21 days after the Invitation Date); and
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(iv) whether employees may enter into a 3 year Savings Contract or
a 5 year Savings Contract; and
(v) whether the repayment under the Savings Contracts linked to
those Options shall include any Bonus and, if so, whether in
the case of a 5 year Savings Contract, it may include the
Maximum Bonus or the Standard Bonus.
(b) Each person who in relation to a grant of an Option is an Eligible
Employee may, not later than the date specified in the Invitation
referred to in Rule 3(a) as the last date for receipt of applications,
apply for an Option in respect of any of the Plan Shares specified in
any such Invitation, by delivery of a Valid Application complying with
the requirements of this Rule to the secretary for the time being of
the Company, or as specified on the application form.
(c) Applications for Options shall be in writing in such form as the
Committee may from time to time prescribe.
4 GRANT OF OPTIONS
CONTRIBUTIONS UNDER THE SAVINGS CONTRACT
(a) The monthly contribution payable by a participant under a Savings
Contract shall be in multiples of (pound)1 and shall not:
(i) be less than(pound)5 or such other minimum amount as may for
the time being be permitted under the terms of the Savings
Contract; nor
(ii) when aggregated with the monthly contributions being paid
under any other savings contract(s), certified pursuant to
section 326 of the Act, entered into by that Eligible
Employee in connection with the grant of any option under a
savings-related share option plan approved by the Board of
the Inland Revenue under Schedule 9, exceed (pound)250 or
such maximum amount determined by the Committee and from time
to time permitted under Schedule 9.
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TIMING OF GRANT
(b) No Option shall be granted to any Eligible Employee if such grant shall
be prohibited under the legislation from time to time in force
governing the approval of savings-related share option plans involving
a certified contractual savings scheme.
GRANT OF OPTIONS
(c) The grant of an Option shall be conditional upon the Eligible Employee
having submitted to the Committee (or such other party as the Committee
in its discretion shall direct) a Valid Application, prior to the grant
of that Option, for entry into a Savings Contract. In making his
application the Eligible Employee shall state inter alia the monthly
contribution which he would like to make under the Savings Contract
and, if he may elect for a 3 year or a 5 year Savings Contract, his
election in that respect, and if he has elected for a 5 year Savings
Contract whether he elects for the repayment under the Savings Contract
to be taken as including the Standard Bonus or the Maximum Bonus (if so
permitted pursuant to Rule 3(a)). Each such application shall be deemed
to be in respect of the largest whole number of Plan Shares which can
be purchased with the expected repayment (including the Standard Bonus
or Maximum Bonus applied for if this is to be included in accordance
with Rule 3(a)(v)) under the Savings Contract at the Bonus Date.
(d) As soon as possible after the final date for the receipt of
applications in relation to each grant of Options and within 30 days of
the earliest of the dates on which the Market Value was taken for the
purposes of determining the Option Price, the Company shall, subject to
Rule 4(f), grant to each Eligible Employee who has submitted a Valid
Application an Option in respect of the whole number of Plan Shares for
which he is deemed to have applied in accordance with Rule 3(c).
(e) If the Committee receives Valid Applications such that on the grant of
all the Options applied for the maximum number of Shares determined by
the Committee pursuant to Rule 3(a)(i) would be exceeded, then subject
to the provisions of Rule 4(a)(i) the following steps or such other
arrangements approved in advance by the Inland Revenue shall be carried
out in the following order to the extent necessary to eliminate the
excess:
(i) if the Maximum Bonus is included, then only the Standard Bonus
shall be taken to be included;
(ii) the excess over (pound)50, or such greater or lesser amount as
the Committee may decide, of the monthly savings contribution
chosen by each applicant shall be reduced pro rata to the
extent necessary;
(iii) the excess over (pound)5 of the monthly savings contribution
chosen by each applicant shall be reduced pro-rata to the
extent necessary;
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(iv) if the Standard Bonus is included or is taken to be included
then no Bonus shall be taken to be included;
(v) applications will be selected by lot, each based on a monthly
savings contribution of (pound)5 and the exclusion of any
Bonus in the repayment under the Savings Contract.
As soon as possible after the final date for the receipt of
applications in relation to each grant of Options and within 42 days of
the earliest of the dates on which the Market Value was taken for the
purposes of determining the Option Price, the Company shall grant to
each Eligible Employee who has submitted a Valid Application, or where
appropriate to those Eligible Employees selected by lot pursuant to
this Rule 4(e), an Option in respect of the number of Plan Shares for
which he is deemed to have applied scaled down proportionately to the
reduction made in his monthly contributions pursuant to this Rule 4(e).
OPTION CERTIFICATES
(f) Subject to the Eligible Employee entering into a Savings Contract, as
soon as possible after the Date of Grant each Eligible Employee shall
be issued an Option Certificate in respect of his Option, specifying
the Date of Grant, the number of Plan Shares subject to the Option, the
Option Price and the Acquisition Price.
OPTIONS ONLY TO BE GRANTED TO EMPLOYEES AND DIRECTORS
(g) No Option shall be granted to any person who is no longer a director or
employee of a Group Company on the date Options are granted under this
Rule 4.
LIFE OF THE PLAN
(h) No Option may be granted more than ten years after the Adoption Date.
5 NON-TRANSFERABILITY OF OPTIONS
Save as provided in Rule 6(b) no Option nor any right thereunder shall be
capable of being transferred, assigned, charged or otherwise disposed of. Any
such purported transfer, assignment, charge or disposal shall result in the
cancellation of the Option.
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6 RIGHTS TO EXERCISE OPTIONS
GENERAL
(a) (i) Save as provided in Rules 6(b), 6(c), 6(e), 6(g) and 8, an Option
may be exercised only during the period commencing with the Bonus
Date under the relevant Savings Contract; and
(ii) save as provided in Rule 6(b), an Option shall not be exercisable
later than six months after such Bonus Date.
DEATH
(b) If an Option-holder dies, future savings contributions cease, but any
outstanding Option may be exercised by his legal personal
representatives, but only:
(i) within 12 months after the date of his death if such death occurs
before the Bonus Date; or
(ii) within 12 months after the Bonus Date in the event of his death
within six months after such Bonus Date.
CESSATION OF EMPLOYMENT IN SPECIAL CIRCUMSTANCES
(c) If an Option-holder shall cease to be employed within the Group by
reason:
(i) of injury or disability (evidenced to the satisfaction of the
Committee) or redundancy within the meaning of the Employment
Rights Act 1996; or
(ii) of retirement on reaching the Specified Age or his Normal
Retirement Date; or
(iii) that his office or employment is in a company of which the
Company ceases to have Control; or
(iv) that his office or employment relates to a business or part of a
business which is transferred to a person who is not a company of
which the Company has Control
he may exercise all or any of his Options in whole or in part during
the period ending six months after the date of such cessation (at the
end of which period his Options will lapse to the extent unexercised).
(d) No person shall be treated for the purposes of Rule 6(c) and 6(g) as
ceasing to hold the office or employment by virtue of which he is an
Eligible Employee until he ceases to
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hold any office or employment in the Company or any Associated Company
over which the Company has Control.
REACHING SPECIFIED AGE
(e) If at the date of reaching the Specified Age an Option-holder does not
retire he may exercise his Option within the period of six months
commencing with that date.
EMPLOYEE TRANSFERRED TO OTHER MEMBER OF THE GROUP
(f) An Option-holder who is employed on the Bonus Date by an Associated
Company of a Group Company or by a company of which the Company has
Control may exercise his Option within the period of six months
commencing with the Bonus Date.
CESSATION OF EMPLOYMENT IN OTHER CIRCUMSTANCES
(g) If an Option-holder shall cease to hold the office or employment by
virtue of which he is an Eligible Employee more than three years after
the Date of Grant of an Option other than by reason of misconduct, such
Option may be exercised within six months after the date of such
cessation at the end of which period his Options will lapse to the
extent unexercised.
TERMINATION OF SAVINGS CONTRACT
(h) If an Option-holder gives, or under the terms of the Savings Contract
has or is deemed to have given, notice to the relevant Savings
Authority that he intends to stop paying contributions under his
Savings Contract then, unless the relevant Option is then exercisable
under this Rule 6, it shall thereupon lapse.
BANKRUPTCY
(i) If the Option-holder is adjudicated bankrupt, his Option shall
thereupon lapse.
CONDITIONS TO BE SATISFIED AT TIME OF EXERCISE
(j) No Option may be exercised by an Option-holder, or by the legal
personal representatives of an Option-holder who is (or at the date of
his death was):
(i) not a director or employee of the Company, or a Group Company
unless the Option is to be exercised pursuant to Rules 6(b), 6(c)
6(f) and 6(g); or
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(ii) precluded from such exercise by paragraph 8 of Schedule 9.
EXERCISE TO BE LIMITED TO REPAYMENT PROCEEDS
(k) If an Option becomes exercisable under any provision of this Plan then
the maximum number of Plan Shares over which it shall be exercisable
shall be limited to the largest whole number of Plan Shares that may be
acquired at the Option Price out of the repayment including any
interest or Bonus received under the relevant Savings Contract. For
these purposes the repayment under the Savings Contract shall exclude
the repayment of any contribution the due date for payment of which
falls more than one month after the date on which repayment is made.
7 LOSS OF OFFICE OR EMPLOYMENT
(a) The grant of an Option does not form part of the Option-holder's
entitlement to remuneration or benefits pursuant to his contract of
employment nor does the existence of a contract of employment between
an Eligible Employee and any company give such Eligible Employee any
right or entitlement to have an Option granted to him in respect of any
number of Plan Shares or any expectation that an Option might be
granted to him whether subject to any conditions or at all.
(b) The rights and obligations of an Option-holder under the terms and
conditions of his office or employment shall not be affected by his
participation in the Plan or any right he may have to participate in
the Plan.
(c) An individual who participates in the Plan waives all and any rights to
compensation or damages in consequence of the termination of his office
or employment with any company for any reason whatsoever in so far as
those rights arise, or may arise, from his ceasing to have rights under
or be entitled to exercise any Option under the Plan as a result of
such termination or from the loss or diminution of value of such rights
or entitlements. By participating in this Plan the Option-holder agrees
that, if necessary, his terms of employment shall be varied
accordingly.
8 TAKEOVERS, RECONSTRUCTION, AMALGAMATION & LIQUIDATION
CHANGE IN CONTROL OF THE COMPANY - ACQUIRING COMPANY
(a) If after the Adoption Date and subject to Rules 8(f) to 8(j), any
company has become an Acquiring Company the Committee shall as soon as
practicable thereafter notify every Option-holder accordingly, and each
Option-holder may within the Appropriate Period:
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(i) exercise all or any of his Options to the extent of the repayment
due under the relevant Savings Contracts; or
(ii) to the extent that an Option is not or has not been exercised,
execute, with the consent of the Acquiring Company, an Option
Rollover by a notice in writing in a form prescribed by the
directors of the Acquiring Company.
(b) To the extent that any Option which has become exercisable and/or
capable of being Rolled-over pursuant to Rule 8(a)(i) or 8(a)(ii) has
not been exercised and/or Rolled-over at the expiry of the Appropriate
Period it shall to the extent unexercised lapse.
(c) For the purposes of an Option Rollover the new rights shall only be
regarded as equivalent to the old rights if:
(i) the shares to which they relate satisfy the conditions of
paragraph 10 to 14 of Schedule 9; and
(ii) the new rights are exercisable in the same manner as the old
rights and subject to the provisions of this Plan as it had
effect immediately before an Option Rollover; and
(iii) the total market value of the Plan Shares subject to an Option
which is being Rolled-over is equal immediately before such
Option Rollover to the total market value (in each case
determined in accordance with Part VIII of the Taxation of
Chargeable Gains Act 1992) of the shares in respect of which an
Option-holder's new rights are being granted immediately after
such Option Rollover; and
(iv) the total amount payable in respect of the exercise in full of an
Option following an Option Rollover is equal to the total
Acquisition Price immediately preceding such Option Rollover.
(d) For the purposes of any application of the provisions of this Plan,
following an Option Rollover any new rights granted pursuant to Rule
8(a) shall be regarded as having been granted at the time the
corresponding old rights were granted. With effect from the Option
Rollover, the new rights shall be subject to the provisions of the Plan
as it had effect in relation to Options which have been released.
CHANGE IN CONTROL OF THE COMPANY - ACQUIRING PERSON
(e) If after the Adoption Date, a person becomes an Acquiring Person and
subject to Rules 8(f) to 8(j) the Committee shall, as soon as
practicable thereafter, notify every Option-
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holder accordingly and each Option-holder may within the Appropriate
Period exercise his Options to the extent of the repayment due under
the relevant Savings Contracts (but in the case of a Compromise subject
to Rules 8(f) to 8(j)) and any Option which has become exercisable
pursuant to this Rule 8(e) and has not been exercised at the expiry of
the Appropriate Period shall to the extent unexercised lapse.
CHANGE IN CONTROL OF THE COMPANY - ADDITIONAL PROVISIONS FOR COMPROMISES
(f) Where a Compromise is proposed between the Company and its members:
(i) Options which prior to the date of any general meeting of the
members ordered by the court have become exercisable pursuant to
the Rules of this Plan excluding Rule 8(g) shall, subject to
Rules 8(h) to 8(j) remain exercisable and may be exercised in
accordance with Rule 8(a) or (e) or at the election of the
Option-holder be exercised on the basis set out in Rule 8(g); and
(ii) Rule 8(g) shall apply to any Option not falling within Rule
8(f)(i).
(g) Options to which this Rule 8(g) applies shall become exercisable from
the date of the meeting of the members ordered by the court on terms
that exercise is conditional on the court sanctioning the Compromise
and where exercise is permitted under this Rule 8(g):
(i) notice of exercise shall be in such form as may be prescribed by
the Committee; and
(ii) notwithstanding any other provision in this Plan, the date of
exercise of all Options exercised conditionally pursuant to this
Rule 8(g) shall be the date on which the court sanctions the
Compromise.
(h) Notwithstanding any other Rule in this Plan, unless the Committee
determines otherwise, no notice of exercise of an Option shall be
effective if received on or after the day on which it is anticipated
that the court will sanction the Compromise.
(i) If after six months from the date of the meeting ordered by the court
to consider the Compromise referred to in Rule 8(f) the court has not
sanctioned the Compromise, the conditional exercise of Options under
Rule 8(g) shall be of no effect and Rules 8(f) and 8(h) shall cease to
apply in relation to that Compromise.
(j) Upon the Compromise becoming effective, any Options, to the extent
unexercised, shall lapse.
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PLAN SHARES CEASING TO SATISFY PARAGRAPHS 10 TO 14 OF SCHEDULE 9
(k) If a resolution is proposed or an action taken as a result of which
Plan Shares will cease to satisfy the requirements of any of paragraphs
10 to 14 of Schedule 9, then, unless the Committee determines that all
Options may be exercised in such manner as it may determine at such
time as it may specify but in any event before the date on which Plan
Shares will cease to satisfy the requirements of paragraphs 10 to 14 of
Schedule 9, the Committee will be deemed to have notified the Board of
Inland Revenue that the Plan no longer satisfies the requirements for
approval and that from then on the Plan shall continue in force as an
unapproved plan. From the date of such resolution being passed or such
action being taken the definition of Plan Shares in Rule 1(a) shall be
taken to have been amended to exclude the words "which satisfy the
conditions specified in paragraphs 10 to 14 inclusive of Schedule 9"
and requirements throughout the Plan to obtain the approval of the
Board of Inland Revenue shall no longer have effect. The Committee
shall notify Option-holders in writing that Options may be exercised or
that the status of the Plan will be changed and shall send a copy of
that notification to the Board of Inland Revenue.
LIQUIDATION
(l) If notice is duly given of a general meeting at which a resolution will
be proposed for the voluntary winding-up of the Company, except for the
purposes of reconstruction or amalgamation, an Option shall be
exercisable in whole or in part at any time thereafter until the
resolution is duly passed or defeated or the general meeting concluded
or adjourned sine die, whichever shall first occur. If such a
resolution is passed, the Option shall, to the extent unexercised,
thereupon lapse and if such a resolution is defeated the relevant
Option shall, to the extent unexercised, thereupon continue to subsist.
9 EXERCISE OF OPTIONS
PROCEDURES ON EXERCISE
(a) Exercise of an Option, or of new rights under this Plan, shall be
effected by a notice in writing in a form prescribed from time to time
by the Committee lodged with the Secretary of the company or at its
office as appropriate or with the Company's duly appointed agent
specifying the number of Plan Shares in respect of which the Option is
being exercised and accompanied by evidence of the termination of the
related Savings Contract. The exercise of the Option will not take
place until a remittance for the Acquisition Price for the Plan Shares
concerned is received. Payment may be made by banker's draft or cheque
or telegraphic or other electronic transfer provided that if a cheque
is not cleared the Eligible Employee shall be deemed never to have
exercised his Option and neither the Company nor any other person will
be under any obligation to
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provide any Plan Shares for him. Notwithstanding anything to the
contrary therein contained such notice shall (other than in the
circumstances contained in the immediately preceding proviso and/or
Rule 8(g) above) take effect upon receipt of notice and payment in full
and such day shall, notwithstanding Rule 11(c) constitute for all
purposes the date of exercise of such Option and the Secretary of the
Company shall procure that the said shares are issued or transferred
within 28 days thereafter. The Option Certificate should also be lodged
but failure to do so will not invalidate the exercise of the Option.
The company will keep a suitable form of notice available, so that an
Option-holder desirous of exercising an Option may obtain copies
thereof from the Secretary of the Company.
(b) All transfers and all allotments of Plan Shares shall be subject to any
necessary consents of HM Treasury or other authorities in the United
Kingdom or elsewhere under enactment's or regulations for the time
being in force and it shall be the responsibility of the Option-holder
to comply with any requirements to be fulfilled in order to obtain or
obviate the necessity for any such consent.
RIGHTS ATTACHING TO PLAN SHARES
(c) Plan Shares transferred pursuant to this Plan will be transferred
without the benefit of any rights attaching thereto by reference to a
record date preceding the date of exercise. Save as regards rights
attaching to Plan Shares by reference to a record date prior to the
date on which the Plan Shares are allotted and issued, Plan Shares
issued upon the exercise of Options shall be identical and rank pari
passu in all respects with shares of the same class then in issue.
10 PLAN AMENDMENTS AND TERMINATION
AMENDMENTS
(a) Notwithstanding the provisions of Rules 10(b) to 10(d) and 11(b), the
Committee may at any time make such alterations (including additions)
to the Rules as are necessary to secure that the Rules receive initial
approval from the Board of Inland Revenue under Schedule 9 and continue
to be so approved.
(b) Subject to Rules 10(c) and 10(d) the Committee may from time to time at
its absolute discretion, amend any of the Rules.
(c) No amendment waiver or replacement to or of this Plan (or any Rule)
shall be made to the extent to which it would have the effect of
abrogating or altering adversely any of the subsisting rights of
Option-holders except with such consent on their part as would be
required by the provisions of the Company's Bye-Laws if the Plan Shares
to be issued or transferred on the exercise of the Options already
granted and still subsisting were so
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issued or transferred and constituted a separate class of share capital
and if such provisions applied mutatis mutandis thereto.
(d) So long as this Plan remains approved under Schedule 9 no amendment to
this Plan shall take effect after the date of alteration until the
Board of Inland Revenue has approved the amendment or the Committee is
deemed to have given the notification to the Inland Revenue described
in Rule 8(k).
(e) The Committee shall have the power from time to time to make or vary
regulations for the administration of this Plan and to amend the terms
or impose further conditions on the grant and exercise of Options to
take account of overseas taxation, and securities or exchange control
laws provided always that such regulations, terms and conditions shall
not be inconsistent with the provisions of this Plan and shall not
cause any of the provisions of Schedule 9 relevant to this Plan to
cease to be satisfied.
TERMINATION
(f) Notwithstanding the provision contained in Rule 4(h), the Board of
Directors or the Committee may at any time resolve that no further
Options be granted under this Plan, and in such event no further
Options will be granted but in all other respects the provisions of
this Plan shall remain in full force and effect.
11 ADMINISTRATION
NOTICE AND DOCUMENTS
(a) Option-holders not otherwise entitled thereto may be sent copies of all
relevant notices and other documents sent by the Company to its
ordinary shareholders generally.
(b) Written notices of any amendment made in accordance with Rule 10 shall
be given to those Option-holders affected by such amendment.
(c) Any notice or other document required to be given hereunder to any
Option-holder shall be delivered to him or sent by First Class pre-paid
post to him at his home address according to the records of the Company
or such other address as may appear to the Company to be appropriate.
Any notice or other document required to be given to the Company shall
be delivered to it or sent by First Class pre-paid post to its
registered office or such other address as may be determined by the
Company to be appropriate. Notices sent by post shall be deemed to have
been given on the fifth day following the date of posting.
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DISPUTES
(d) The decision of the Committee in any dispute or question relating to
any Option shall be final and conclusive subject to the terms of this
Plan.
COSTS OF THE PLAN
(e) The costs of introducing and administering this Plan shall be borne by
the Company.
GOVERNING LAW
(g) These Rules shall be governed by and construed in accordance with
Bermudan Law.
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