Exhibit 10.6
PHARMACIA CORPORATION
EQUITY COMPENSATION PLAN
Amended and Restated as of September 24, 2001
The purpose of the Pharmacia Corporation Equity Compensation Plan (the
"Plan") is to provide designated employees of Pharmacia Corporation (the
"Company") and its subsidiaries with the opportunity to receive grants of
nonqualified stock options, stock appreciation rights and restricted stock, with
respect to common stock of the Company. The Company believes that the Plan will
encourage the participants to contribute materially to the growth of the
Company, thereby benefiting the Company's shareholders, and will align the
economic interests of the participants with those of the shareholders.
1. Administration
(1) Committee. The Plan shall be administered and interpreted by a
committee (the "Committee") appointed by the Board of Directors of the Company
(the "Board"). The Committee may delegate any or all of its powers hereunder to
the Chief Executive Officer of the Company (the "CEO"). If the CEO administers
the Plan, references in the Plan to the "Committee" shall be deemed to refer to
the CEO.
(2) 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 or restriction period, including the
criteria for exercisability and the acceleration of exercisability; (iv) amend
the terms of any previously issued grant; (v) appoint employees of the Company
or its subsidiaries or third parties to act as the Company's agents with respect
to administration of the Plan, including, but not limited to, the administration
of the exercise of Awards granted under the Plan; (vi) adopt and amend from time
to time such forms, agreements, communications, or practices deemed advisable by
the Committee for use in administering the Plan pursuant to the most current
technology, and (vii) deal with any other matters arising under the Plan.
(3) 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.
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2. Grants
Awards under the Plan may consist of grants of nonqualified stock
options as described in Section 5 ("Options"), restricted stock as described in
Section 6 ("Restricted Stock") and stock appreciation rights as described in
Section 7 ("SARs") (hereinafter collectively referred to as "Grants"). All
Grants shall be subject to the terms and conditions set forth herein and to such
other terms and conditions consistent with this Plan as the Committee deems
appropriate and as are specified in writing by the Committee to the individual
in a grant instrument or an amendment to the grant instrument (the "Grant
Instrument"). The Committee shall approve the form and provisions of each Grant
Instrument. Grants under a particular Section of the Plan need not be uniform as
among the grantees.
3. Shares Subject to the Plan
(1) Shares Authorized. Subject to adjustment as described below, the
aggregate number of shares of common stock of the Company ("Company Stock") that
may be issued or transferred under the Plan is 14,760,000 shares of Company
Stock. The shares may be authorized but unissued shares of Company Stock or
reacquired shares of Company Stock, including shares purchased by the Company on
the open market for purposes of the Plan. If and to the extent Options or SARs
granted under the Plan terminate, expire, or are canceled, forfeited, exchanged
or surrendered without having been exercised, if and to the extent that any SARs
are paid in cash, and if and to the extent that any shares of Restricted Stock
are forfeited, the shares subject to such Grants shall again be available for
purposes of the Plan. If shares of Company Stock are used to pay the exercise
price of an Option, only the net number of shares received by the grantee
pursuant to such exercise shall be considered to have been issued or transferred
under the Plan with respect to such Option, and the remaining number of shares
subject to the Option shall again be available for purposes of the Plan.
(2) Adjustments. If there is any change in the number or kind of shares
of Company Stock outstanding (i) by reason of a stock dividend, spinoff,
recapitalization, stock split, or combination or exchange of shares, (ii) by
reason of a merger, reorganization or consolidation in which the Company is the
surviving corporation, (iii) by reason of a reclassification or change in par
value, or (iv) by reason of any other extraordinary or unusual event affecting
the outstanding Company Stock as a class without the Company's receipt of
consideration, or if the value of outstanding shares of Company Stock is
substantially reduced as a result of a spinoff or the Company's payment of an
extraordinary dividend or distribution, the maximum number of shares of Company
Stock available for Grants, the number of shares covered by outstanding Grants,
the kind of shares issued under the Plan, and the price per share or base price
of such Grants may be appropriately adjusted by the Committee to reflect any
increase or decrease in the number of, or change in the kind or value of, issued
shares of Company Stock to preclude, to the extent practicable, the enlargement
or dilution of rights and benefits under such Grants; provided, however, that
any fractional shares resulting from such adjustment shall be eliminated. Any
adjustments determined by the Committee shall be final, binding and conclusive.
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4. Eligibility for Participation
All employees of the Company and its subsidiaries who are not elected
or appointed executive officers of the Company ("Employees") shall be eligible
to participate in the Plan. The Committee shall select the Employees to receive
Grants and shall determine the number of shares of Company Stock subject to a
particular Grant in such manner as the Committee determines. Employees who
receive Grants under this Plan shall hereinafter be referred to as "Grantees".
5. Granting of Options
(1) Number of Shares. The Committee shall determine the number of
shares of Company Stock that will be subject to each Grant of Options to
Employees.
(2) Type of Option and Price.
(i) All Options granted under the Plan shall be nonqualified
stock options, which are not intended to qualify as "incentive stock options"
within the meaning of section 422 of the Internal Revenue Code of 1986, as
amended.
(ii) The purchase price (the "Exercise Price") of Company
Stock subject to an Option shall be determined by the Committee and shall not be
less than the Fair Market Value (as defined below) of a share of Company Stock
on the date the Option is granted.
(iii) "Fair Market Value" shall mean, per share of Company
Stock, the average of the highest and lowest prices of the Company Stock on the
New York Stock Exchange (the "NYSE"), or such other national securities exchange
as may be designated by the Committee, on the applicable date, or, if there are
no sales of Company Stock on the NYSE on such date, then the average of the
highest and lowest prices of the Company Stock on the last previous day on which
a sale on the NYSE is reported.
(3) Option Term. The Committee shall determine the term of each Option,
which shall not exceed ten years from the date of grant.
(4) Exercisability of Options. Options shall become exercisable in
accordance with such terms and conditions, consistent with the Plan, as may be
determined by the Committee at or after grant.
(5) Termination of Employment, Disability or Death.
(i) Unless the Committee determines otherwise, an Option may
only be exercised while the Grantee is employed by the Company (as defined
below) as an employee. The Committee shall determine whether, and under what
circumstances, an Option may be exercised after a Grantee's permanent
disability, death or other termination of employment. Except as otherwise
provided by the Committee, any of the Grantee's Options that are not otherwise
exercisable as of the date on which the Grantee ceases to be employed by the
Company shall terminate as of such date. For purposes of this Section 5(e) and
Sections 6, 7, 8
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and 9, the term "Company" shall mean the Company and its subsidiaries and, if
the Grant Instrument so provides, its parent corporation.
(6) Exercise of Options. A Grantee may exercise an Option that has
become exercisable, in whole or in part, by delivering a notice of exercise (in
the form prescribed from time to time by the Committee) to the Company with
payment of the Exercise Price. The Grantee shall pay the Exercise Price for an
Option as specified by the Committee and set forth in the option agreement and
may include, but is not limited to, the following: (i) in cash, (ii) with the
approval of the Committee, by delivering shares of Company Stock owned by the
Grantee (including Company Stock acquired in connection with the exercise of an
Option, subject to such restrictions as the Committee deems appropriate) and
having a Fair Market Value on the date of exercise equal to the Exercise Price
or by attestation (on a form prescribed by the Committee) to ownership of shares
of Company Stock having a Fair Market Value on the date of exercise equal to the
Exercise Price, (iii) by payment through a broker in accordance with procedures
established by the Committee and permitted by Regulation T of the Federal
Reserve Board, or (iv) by such other method as the Committee may approve. Shares
of Company Stock used to exercise an Option shall have been held by the Grantee
for the requisite period of time to avoid adverse accounting consequences to the
Company with respect to the Option. The Grantee shall pay the Exercise Price and
the amount of any withholding tax due (pursuant to Section 9) at the time of
exercise. The Committee may from time to time adopt such methods and procedures
for exercising outstanding Options as are consistent with current technology and
the Company's system for administering the Plan.
(7) Replacement Options. The Committee may, in its sole discretion,
permit by the terms of a stock option agreement or otherwise that if a Grantee
exercises an Option, in whole or in part, while the Grantee is an Employee and
the Grantee uses shares of Company Stock to exercise the Option, the Grantee may
receive, upon the date of exercise, an additional Option to purchase a number of
shares of Company Stock equal to the number of whole shares used to pay the
Exercise Price for the Option. The new Option shall be granted with an Exercise
Price equal to the Fair Market Value of the Company Stock on the date of grant
of the new Option, for a term not longer than the unexpired term of the
exercised Option and on such other terms as the Committee shall determine. Any
such replacement option shall be subject to the availability of sufficient
shares of Company Stock under Section 3.
6. Restricted Stock Grants
The Committee may issue or transfer shares of Company Stock to an
Employee under a Grant of Restricted Stock, upon such terms as the Committee
deems appropriate. The following provisions are applicable to Restricted Stock:
(1) General Requirements. Shares of Company Stock issued or transferred
pursuant to Restricted Stock Grants may be issued or transferred for
consideration or for no consideration, and subject to restrictions or no
restrictions, as determined by the Committee. The Committee may, but shall not
be required to, establish conditions under which restrictions on shares of
Restricted Stock shall lapse over a period of time or according to such other
criteria as the Committee deems appropriate, including, without limitation,
restrictions based upon the achievement of specific performance goals. The
period of time during which the Restricted
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Stock will remain subject to restrictions will be designated in the Grant
Instrument as the "Restriction Period."
(2) Number of Shares. The Committee shall determine the number of
shares of Company Stock to be issued or transferred pursuant to a Restricted
Stock Grant and the restrictions applicable to such shares.
(3) Requirement of Employment. If the Grantee ceases to be employed by
the Company during a period designated in the Grant Instrument as the
Restriction Period, or if other specified conditions are not met, the Restricted
Stock Grant shall terminate as to all shares covered by the Grant as to which
the restrictions have not lapsed, and those shares of Company Stock must be
immediately returned to the Company. The Committee may, however, provide for
complete or partial exceptions to this requirement as it deems appropriate.
(4) Restrictions on Transfer and Legend on Stock Certificate. During
the Restriction Period, a Grantee may not sell, assign, transfer, pledge or
otherwise dispose of the shares of Restricted Stock except to a Successor
Grantee under Section 10. Each certificate for a share of Restricted Stock shall
contain a legend giving appropriate notice of the restrictions in the Grant. The
Grantee shall be entitled to have the legend removed from the stock certificate
covering the shares subject to restrictions when all restrictions on such shares
have lapsed. The Committee may determine that the Company will not issue
certificates for shares of Restricted Stock until all restrictions on such
shares have lapsed, or that the Company will retain possession of certificates
for shares of Restricted Stock until all restrictions on such shares have
lapsed.
(5) Right to Vote and to Receive Dividends. During the Restriction
Period, the Grantee shall have the right to vote shares of Restricted Stock and
to receive any dividends or other distributions paid on such shares, subject to
any restrictions deemed appropriate by the Committee.
(6) Lapse of Restrictions. All restrictions imposed on Restricted Stock
shall lapse upon the expiration of the applicable Restriction Period and the
satisfaction of all conditions imposed by the Committee. The Committee may
determine, as to any or all Restricted Stock Grants, that the restrictions shall
lapse without regard to any Restriction Period.
7. Stock Appreciation Rights
(1) General Requirements. The Committee may grant SARs to an Employee
separately or in tandem with any Option (for all or a portion of the applicable
Option). Tandem SARs may be granted either at the time the Option is granted or
at any time thereafter while the Option remains outstanding. The Committee shall
establish the base amount of the SAR at the time the SAR is granted. Unless the
Committee determines otherwise, the base amount of each SAR shall be equal to
the per share Exercise Price of the related Option or, if there is no related
Option, the Fair Market Value of a share of Company Stock as of the date of
Grant of the SAR.
(2) Tandem SARs. In the case of tandem SARs, the number of SARs granted
to a Grantee that shall be exercisable during a specified period shall not
exceed the number of shares of Company Stock that the Grantee may purchase upon
the exercise of the related Option during such period. Upon the exercise of an
Option, the SARs relating to the Company Stock covered
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by such Option shall terminate. Upon the exercise of SARs, the related Option
shall terminate to the extent of an equal number of shares of Company Stock.
(3) Exercisability. An SAR shall be exercisable during the period
specified by the Committee in the Grant Instrument and shall be subject to such
vesting and other restrictions as may be specified in the Grant Instrument. The
Committee may accelerate the exercisability of any or all outstanding SARs at
any time for any reason. Unless the Committee determines otherwise, SARs may
only be exercised while the Grantee is employed by the Company or during the
applicable period after termination of employment as described in Section 5(e).
A tandem SAR shall be exercisable only during the period when the Option to
which it is related is also exercisable. The Committee may from time to time
adopt such methods or procedures for exercising SARs as are consistent with
current technology and the Company's system for administering the Plan.
(4) Value of SARs. When a Grantee exercises SARs, the Grantee shall
receive in settlement of such SARs an amount equal to the value of the stock
appreciation for the number of SARs exercised, payable in cash, Company Stock or
a combination thereof. The stock appreciation for an SAR is the amount by which
the Fair Market Value of the underlying Company Stock on the date of exercise of
the SAR exceeds the base amount of the SAR as described in Subsection (a).
(5) Form of Payment. The Committee shall determine whether the
appreciation in an SAR shall be paid in the form of cash, shares of Company
Stock, or a combination of the two, in such proportion as the Committee deems
appropriate. For purposes of calculating the number of shares of Company Stock
to be received, shares of Company Stock shall be valued at their Fair Market
Value on the date of exercise of the SAR. If shares of Company Stock are to be
received upon exercise of an SAR, cash shall be delivered in lieu of any
fractional share.
8. Employees Subject to Taxation Outside the United States
With respect to Employees who are subject to taxation in countries
other than the United States, the Committee may make Grants on such terms and
conditions different from those specified in this Plan (including without
limitation granting stock options with a term longer than ten years if
appropriate to assure favorable tax treatment) as may in the judgment of the
Committee be necessary or desirable to foster and promote achievement of the
purposes of the Plan, and, in furtherance of such purposes, the Committee may
make such modifications, amendments, procedures and subplans as may be necessary
or advisable to comply with the laws of countries in which the Company operates
or has employees.
9. Withholding of Taxes
Grants under the Plan shall be subject to all applicable tax
withholding requirements. Tax withholding requirements may be satisfied in any
of the following ways:
(1) The Company may deduct from all Grants paid in cash, or from other
wages paid to the Grantee, any taxes required by law to be withheld with respect
to such Grants;
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(2) A Grantee may elect to satisfy the Company's tax withholding
obligations with respect to a Grant by having shares withheld up to an amount
that does not exceed the Grantee's minimum applicable withholding tax rate;
(3) A Grantee may satisfy the Company's withholding tax obligations by
tendering shares of Company Stock owned by the Grantee; or
(4) A Grantee may satisfy the Company's withholding tax obligations by
such other method as the Committee may approve.
10. Transferability of Grants. Only the Grantee may exercise rights
under a Grant during the Grantee's lifetime. A Grantee may not transfer those
rights except upon death by will, by the laws of descent and distribution or
pursuant to a written beneficiary designation filed with the Company. When a
Grantee dies, the personal representative or other person entitled to succeed to
the rights of the Grantee ("Successor Grantee") may exercise such rights. A
Successor Grantee must furnish proof satisfactory to the Company of his or her
right to receive the Grant under the Grantee's will, under the applicable laws
of descent and distribution or under the applicable beneficiary designation.
Notwithstanding the foregoing, the Senior Vice President of Human Resources of
the Company may, in his or her sole discretion, allow for the transfer of a
nonqualified stock option for no consideration to the Grantee's "Immediate
Family" upon such terms and conditions as are approved by the Senior Vice
President of Human Resources. In the event of such permitted transfer, the
transferee shall take such nonqualified stock option subject to the same
restrictions, terms and conditions in the stock option agreement at the time of
transfer. For this purpose, "Immediate Family" shall mean (i) the Grantee's
children, grandchildren, spouse or common law spouse, siblings or parents, as
well as (ii) a trust in which these persons (or the Grantee) have more than 50%
of the beneficial interest, a foundation in which these persons (or the Grantee)
control the management of assets, and any other entity in which these persons
(or the Grantee) own more than 50% of the voting interests."
11. Change of Control of the Company
As used herein, a "Change of Control" shall mean:
(1) The acquisition by any individual, entity or group ("Person"),
including any "person" within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), of beneficial
ownership, within the meaning of Rule 13d-3 promulgated under the Exchange Act,
of 33% or more of either (i) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (ii) the combined voting
power of the then outstanding securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that the following acquisitions of Outstanding
Company Common Stock or Outstanding Company Voting Securities shall not
constitute a Change in Control: (A) any acquisition by the Company, (B) any
acquisition by an employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company, or (C)
any acquisition by any corporation pursuant to a reorganization, merger or
consolidation involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in clauses (i), (ii)
and (iii) of subsection (c) of this Section 11 shall be
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satisfied; and provided further that, for purposes of clause (A), if any Person
(other than the Company or any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the
Company) shall become the beneficial owner of 33% or more of the Outstanding
Company Common Stock or 33% or more of the Outstanding Company Voting Securities
by reason of any acquisition of Outstanding Company Common Stock or Outstanding
Company Voting Securities by the Company and such Person shall, after such
acquisition by the Company, become the beneficial owner of any additional shares
of the Outstanding Company Common Stock or any additional Outstanding Voting
Securities and such beneficial ownership is publicly announced, such additional
beneficial ownership shall constitute a Change in Control;
(2) Individuals who, as of the date hereof, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of
such Board; provided, however, that any individual who becomes a director of the
Company subsequent to the date hereof whose election, or nomination for election
by the Company's stockholders, was approved by the vote of at least
three-quarters of the directors then comprising the Incumbent Board (either by a
specific vote or by approval of the proxy statement of the Company in which such
person is named as a nominee for director, without objection to such nomination)
shall be deemed to have been a member of the Incumbent Board; and provided
further, that no individual who was initially elected as a director of the
Company as a result of an actual or threatened election contest, as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, or
any other actual or threatened solicitation of proxies or consents by or on
behalf of any Person other than the Board shall be deemed to have been a member
of the Incumbent Board;
(3) Approval by the stockholders of the Company of a reorganization,
merger or consolidation involving the Company unless, in any such case,
immediately after such reorganization, merger or consolidation, (i) more than
50% of the then outstanding shares of common stock of the corporation resulting
from such reorganization, merger or consolidation and more than 50% of the
combined voting power of the then outstanding securities of such corporation
entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals or
entities who were the beneficial owners, directly or indirectly, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities
immediately prior to such reorganization, merger or consolidation and in
substantially the same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or consolidation, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities,
as the case may be, (ii) no Person (other than the Company, any employee benefit
plan (or related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or consolidation (or any
corporation controlled by the Company), or any Person which beneficially owned,
immediately prior to such reorganization, merger or consolidation, directly or
indirectly, 33% or more of the Outstanding Company Common Stock or the
Outstanding Company Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 33% or more of the then outstanding shares of common
stock of such corporation or 33% or more of the combined voting power of the
then outstanding securities of such corporation entitled to vote generally in
the election of directors and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such reorganization, merger
or consolidation were members of the
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Incumbent Board at the time of the execution of the initial agreement or action
of the Board providing for such reorganization, merger or consolidation; or
(4) (i) Approval by the stockholders of the Company of a plan of
complete liquidation or dissolution of the Company or (ii) the sale or other
disposition of all or substantially all of the assets of the Company other than
to a corporation with respect to which, immediately after such sale or other
disposition, (A) more than 50% of the then outstanding shares of common stock
thereof and more than 50% of the combined voting power of the then outstanding
securities thereof entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or substantially all of
the individuals and entities who were the beneficial owners, respectively, of
the Outstanding Company Common Stock and the Outstanding Company Voting
Securities immediately prior to such sale or other disposition and in
substantially the same proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the Outstanding Company
Common Stock and the Outstanding Company Voting Securities, as the case may be,
(B) no Person (other than the Company, any employee benefit plan (or related
trust) sponsored or maintained by the Company or such corporation (or any
corporation controlled by the Company), or any Person which beneficially owned,
immediately prior to such sale or other disposition, directly or indirectly, 33%
or more of the Outstanding Company Common Stock or the Outstanding Company
Voting Securities, as the case may be) beneficially owns, directly or
indirectly, 33% or more of the then outstanding shares of common stock thereof
or 33% or more of the combined voting power of the then outstanding securities
thereof entitled to vote generally in the election of directors and (C) at least
a majority of the members of the board of directors thereof were members of the
Incumbent Board at the time of the execution of the initial agreement or action
of the Board providing for such sale or other disposition (or were approved
directly or indirectly by the Incumbent Board).
12. Consequences of a Change of Control
(1) Acceleration. Upon a Change of Control, unless the Committee
determines otherwise, (i) all outstanding Options and SARs shall automatically
accelerate and become fully exercisable, and (ii) the restrictions and
conditions on all outstanding Restricted Stock shall immediately lapse.
(2) Assumption of Grants. Upon a Change of Control where the Company is
not the surviving corporation (or survives only as a subsidiary of another
corporation), unless the Committee determines otherwise, all outstanding Options
and SARs that are not exercised shall be assumed by, or replaced with comparable
options or rights by, the surviving corporation, and other outstanding Grants
shall be converted to similar grants of the surviving corporation.
(3) Other Alternatives. Notwithstanding the foregoing, subject to
subsection (d) below, in the event of a Change of Control, the Committee may
take one or both of the following actions with respect to any or all outstanding
Options and SARs: the Committee may (i) require that Grantees surrender their
outstanding Options and SARs in exchange for a payment by the Company, in cash
or Company Stock as determined by the Committee, in an amount equal to the
amount by which the then Fair Market Value of the shares of Company Stock
subject to the Grantee's unexercised Options and SARs exceeds the Exercise Price
of the Options or the base
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amount of the SARs, as applicable or (ii) after giving Grantees an opportunity
to exercise their outstanding Options and SARs, terminate any or all unexercised
Options and SARs at such time as the Committee deems appropriate. Such surrender
or termination shall take place as of the date of the Change of Control or such
other date as the Committee may specify.
(4) Limitations. Notwithstanding anything in the Plan to the contrary,
in the event of a Change of Control, the Committee shall not have the right to
take any actions described in the Plan (including without limitation actions
described in Subsection (c) above) that would make the Change of Control
ineligible for pooling of interests accounting treatment or that would make the
Change of Control ineligible for desired tax treatment if, in the absence of
such right, the Change of Control would qualify for such treatment and the
Company intends to use such treatment with respect to the Change of Control.
13. Requirements for Issuance or Transfer of Shares
No Company Stock shall be issued or transferred in connection with any
Grant hereunder unless and until all legal requirements applicable to the
issuance or transfer of such Company Stock have been complied with to the
satisfaction of the Committee. The Committee shall have the right to condition
any Grant made to any Grantee hereunder on such Grantee's undertaking in writing
to comply with such restrictions on his or her subsequent disposition of such
shares of Company Stock as the Committee shall deem necessary or advisable, and
certificates representing such shares may be legended to reflect any such
restrictions. Certificates representing shares of Company Stock issued or
transferred under the Plan will be subject to such stop-transfer orders and
other restrictions as may be required by applicable laws, regulations and
interpretations, including any requirement that a legend be placed thereon.
14. Amendment and Termination of the Plan
(1) Amendment. The Board may amend or terminate the Plan at any time.
(2) Termination of Plan. The Plan shall terminate on the day
immediately preceding the tenth anniversary of its effective date, unless the
Plan is terminated earlier by the Board or is extended by the Board with the
approval of the shareholders.
(3) Termination and Amendment of Outstanding Grants. A termination or
amendment of the Plan that occurs after a Grant is made shall not materially
impair the rights of a Grantee unless the Grantee consents or unless the
Committee acts under Section 20(b). The termination of the Plan shall not impair
the power and authority of the Committee with respect to an outstanding Grant.
Whether or not the Plan has terminated, an outstanding Grant may be terminated
or amended under Section 20(b) or may be amended by agreement of the Company and
the Grantee consistent with the Plan.
(4) 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.
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15. 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 any Grants under this Plan. In no event shall
interest be paid or accrued on any Grant, including unpaid installments of
Grants.
16. Rights of Participants
Nothing in this Plan shall entitle any Employee or other person to any
claim or right to be granted a Grant under this Plan. Neither this Plan nor any
action taken hereunder shall be construed as giving any individual any rights to
be retained by or in the employ of the Company or any other employment rights.
17. No Fractional Shares
No fractional shares of Company Stock shall be issued or delivered
pursuant to the Plan or any Grant. 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.
18. 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.
19. Effective Date of the Plan.
The Plan shall be effective as of January 1, 1999. The Plan was amended
as of September 21, 2000 and was further amended and restated effective as of
September 24, 2001.
20. Miscellaneous
(1) 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 Grants 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.
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(2) Compliance with Law. The Plan, the exercise of Options and SARs and
the obligations of the Company to issue or transfer shares of Company Stock
under Grants shall be subject to all applicable laws and to approvals by any
governmental or regulatory agency as may be required. 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 Grantees. The Committee
may, in its sole discretion, agree to limit its authority under this Section.
(3) Governing Law. The validity, construction, interpretation and
effect of the Plan and Grant Instruments issued under the Plan shall be governed
and construed by and determined in accordance with the laws of the State of
Delaware, without giving effect to the conflict of laws provisions thereof.
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