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Exhibit 10.2
GENESEE & WYOMING AUSTRALIA PTY LTD ACN 080 579 308
EXECUTIVE SHARE OPTION PLAN
RULES
1. DEFINITIONS AND INTERPRETATION
1.1 Definitions
In these Rules, unless the contrary intention appears:
Application Form means the form referred to in Rule 5.4(b).
ASX means Australian Stock Exchange Limited.
Board means the Board of Directors of the Company as constituted from time
to time.
Business Day has the meaning given to that term in the Listing Rules.
Company means Genesee & Wyoming Australia Pty Limited ACN 080 579 308.
Control has the meaning given to it under the Corporations Law.
Director means director of the Company from time to time.
Eligible Person means the Executives, the Company's senior executives and
the senior executives of Related Bodies Corporate of the Company from time
to time.
Equivalent Value of an Executive Option on a given date means:
(a) the Market Value of the Shares that would be issued if the Executive
Option were exercised on that date;
LESS
(b) the Exercise Price of that Executive Option.
Executive means each of Chuck Chabot, Anthony Mogytych, Paul Zaleck, Colin
Turner, Ian Jamieson and Thomas Lanni.
Executive Option means an option granted under this Plan.
Exercise Period means the period during which an Executive Option can be
exercised pursuant to Rule 8.
Exercise Price means the consideration per Share, determined in accordance
with Rule 9, payable by a Holder to the Company for the issue of Shares the
subject of the relevant Executive Option.
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2.
Expiry Date means in respect of an Executive Option the expiry date
specified in the Offer Notice in respect of that Option.
Holder means the registered holder of an Executive Option.
Independent Expert means an independent accountant selected by the Board;
Listed means having been admitted to the official list of the ASX and at
the relevant time still being so admitted even though, for the avoidance of
doubt, the quotation of the Company's securities may be suspended or
subject to a trading halt.
Listing Rules means the official listing rules of the ASX and any other
rules of the ASX which are applicable while the Company is Listed, except
to the extent of any express written waiver by the ASX.
Market Value means:
(a) before the Company is Listed, EBITDA of the Company multiplied by 5.5
less debt all debt (for the avoidance of doubt, debt includes bank
debt and any other liabilities in the nature of long term financing,
but does not include current liabilities incurred in the ordinary
course of business);
(b) where the Company is Listed, the weighted average of the sale price of
Shares quoted on the stock exchange of the ASX in the 5 Business Days
prior to the date on which the Market Value is to be calculated
(excluding the day of calculation);
(c) during a Trade Sale, the average price per share on a net present
value basis at a discount rate nominated by the Company that the
purchaser or subscriber is paying for the Company's shares
Marketable Parcel has the meaning given by the Listing Rules.
Offer Notice means an offer to grant Executive Options made under Rule 5.4;
Option Certificate means the certificate issued by the Company to the
relevant Holder in respect of an Executive Option.
Plan means the "Genesee & Wyoming Australia Pty Ltd Executive Share Option
Plan" constituted by these Rules.
Related Body Corporate has the meaning given to it under the Corporations
Law.
Rules means these rules as amended from time to time.
Share means a fully paid ordinary share in the capital of the Company. For
the purposes of this Plan, as at the commencement date of the total number
of shares issued by the Company is 16,524,000.
Supervening Event means:
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3.
(a) the sale of the main operating assets of the Company; or
(b) a change in Control of the Company; or
(c) a restructure of the affairs of the Company or its Related Bodies
Corporate that will affect the value of the Shares in the Company; or
(d) any fact, matter or circumstance which in the reasonable opinion of
the Board makes it undesirable for Executive Options to become
exercisable,
but does not include a Trade Sale.
Trade Sale means a sale or issue of 25% or more of the issued capital of
the Company to a single or related purchasers or subscribers;
1.2 Interpretation
In these Rules, unless the context otherwise requires:
(a) where an expression is defined, another part of speech or grammatical
form of that expression has a corresponding meaning;
(b) a reference to any legislation provision, regulation, rule or by-law
(including the Listing Rules) includes any statutory modification or
re-enactment of, or legislative provision substituted for, and any
subordinate legislation issued under, that legislation or legislative
provision;
(c) the singular includes the plural and vice versa;
(d) a reference to an individual or person includes a corporation,
partnership, joint venture, association, authority, trust, entity,
state or government and vice versa;
(e) a reference to any gender includes all genders; and
(f) including and similar expressions are not and must not be treated as
words of limitation.
1.3 Compliance with the Corporations Law and the Listing Rules
(a) Notwithstanding anything express or implied in these Rules, each and
every provision of these Rules is subject to the Corporations Law and,
if the Company is Listed, the Listing Rules.
(b) If there is any inconsistency between any provision of these Rules and
the Corporations Law or, if the Company is Listed, the Listing Rules,
the Corporations Law or the Listing Rules (as the case may be) will
prevail to the extent of the inconsistency.
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4.
1.4 Listing Rules
A reference in these Rules to the Listing Rules or the ASX has effect only
for so long as the Company is Listed and must otherwise be disregarded.
2. ESTABLISHMENT OF PLAN
2.1 The Board hereby establishes the Plan in accordance with the Rules.
2.2 The Plan hereby constituted is called the "Genesee & Wyoming Australia Pty
Ltd Executive Share Option Plan".
3. OBJECTIVES
The objectives of the Plan are:
(a) to enable exceptional Eligible Persons to acquire an interest in the
Company;
(b) create a sense of ownership in the Company and its success;
(c) to assist in the attraction and retention of high quality Eligible
Persons;
(d) to allow such persons interests to be aligned with the interests of
the Company's other shareholders;
(e) to avoid taking any action which could harm the commercial interests
the Company within 12 months of ceasing employment with the Company.
4. ADMINISTRATION OF PLAN
The Board is to administer the Plan and the Board has power:
(a) to determine procedures from time to time to administer the Plan
consistent with these Rules;
(b) to resolve conclusively all questions of fact or interpretation
arising in connection with the Plan; and
(c) to delegate to any one or more persons (including a committee) for
such period and on such conditions as the Board may determine the
exercise of any of the Board's powers or discretions arising under the
Plan.
5. ENTITLEMENT
5.1 The Board may at any time and from time to time determine which of the
Eligible Persons are eligible to participate in the Plan.
5.2 The Directors may from time to time determine in their absolute discretion
the number of Executive Options which may be granted to each Eligible
Person (if any).
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5.
5.3 In making the determinations under Rules 5.1 and 5.2, the Directors may
have regard to the following factors:
(a) the length of service of the Eligible Person with the Company or any
Related Body Corporate;
(b) the record of employment of the Eligible Person with the Company or
any Related Body Corporate;
(c) the potential contribution of the Eligible Person to the growth of the
Company or any Related Body Corporate;
(d) any other matters which tend to indicate the merit of the Eligible
Person; and
(e) where the Eligible Person was offered the right to participate in the
Plan before he or she commenced full time employment with the Company
or any Related Body Corporate, the fact that such an offer was made
and the terms of that offer.
5.4 Following a determination under Rule 5.2 to grant Executive Options, the
Company must give each Eligible Person to be granted Executive Options:
(a) an offer in writing to apply to take up those Executive Options
setting out:
(i) the number of Executive Options;
(ii) the Exercise Price (in Australian dollars), or where the
Exercise Price is determinable at some future time by reference
to a formula, the acquisition price (in Australian dollars)
were that formula applied as at the date of the offer; and
(iii) the Expiry Date of the Executive Options; and
(iv) any additional terms and conditions for the exercise of the
Executive Options (such as any performance criteria) not set
out in these Rules;
(b) an application form; and
(c) a copy of the Rules.
5.5 The making of the offer by the Company will not constitute any legally
binding commitment to the grant of the Executive Options referred to except
upon the actual grant of the Executive Options.
5.6 An Eligible Person who desires to apply for Executive Options must sign and
return to the Company the Application Form to that effect.
5.7 An Eligible Person may apply for less than the number of Executive Options
offered to him or her.
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6.
5.8 If required by the Corporations Law or the Listing Rules, the Company must
provide to ASIC a copy of the offer or invitation document (which need not
contain details of the offer or invitation particular to the offeree such
as the identity or entitlement of the offeree) and of each accompanying
document no later than 7 days after the provision of that material to the
offeree.
5.9 The Eligible Person will obtain Executive Options on the date of the grant
of the Executive Options by the Company at the times specified in the
Application Form. An Eligible Person who ceases for any reason whatsoever
to be employed by the Company or a Related Body Corporate of the Company
will not have any right to the grant of Executive Options that have not yet
been granted to him or her.
6. GRANT OF EXECUTIVE OPTIONS
6.1 Subject to these Rules, the grant of Executive Options will take place at
such times and upon such terms and conditions as the Directors may
determine.
6.2 Unless otherwise determined by the Directors at the time of grant, an
Executive Option will be granted free of charge on the following terms and
conditions:
(a) (Number of Shares) Each Executive Option entitles the Holder to
subscribe for one Share at the Exercise Price.
(b) (Exercise Period) Subject to Rule 8, an Executive Option may be
exercised during such period as determined by the Board from time to
time either generally or in respect of the Eligible Person concerned,
up to and including 5.00 pm South Australian time on the Expiry Date.
(c) (Method of Exercise) An Executive Option may be exercised by notice in
writing to the Company accompanied by payment of the Exercise Price
and the Option Certificate to which the Executive Option relates,
delivered to the registered office of the Company during the Exercise
Period.
(d) (Notice of Exercise) The notice referred to in Rule 6.2(c) must
specify the number of Executive Options exercised.
(e) (Board to allot Shares) Within 10 Business Days after receipt of the
notice referred to in Rule 6.2(c) and the payment of the Exercise
Price, the Directors will:
(i) allot to the Holder the number of Shares fully paid up which
corresponds to the number of Executive Options properly exercised
by the Holder;
(ii) cancel the Option Certificate relating to those Executive
Options; and
(iii) if applicable, issue a new Option Certificate in relation to any
unexercised Executive Options.
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7.
(f) (No participating rights) Unless otherwise provided in these Rules, there
are no participating rights or entitlements inherent in the Executive
Options.
(g) (New Issues) Subject to the Listing Rules, if the Company is Listed Holders
will be entitled to participate in new issues of capital offered to
shareholders of the Company on the prior exercise of their Executive
Options. The Company will ensure that for the purposes of determining
entitlements to any such issue, the record date in respect of that issue
will be at least ten Business Days after the issue is announced. This will
give Holders the opportunity to exercise their Executive Options should
they so wish prior to the date for determining entitlements to participate
in any such issue.
(h) (Pro rata issue) Subject to the Listing Rules, if during the life of an
Executive Option, there is a pro rata issue (except a bonus issue) to the
holders of Shares, the Exercise Price may be reduced according to the
following formula:
O' = O - E[P-(S+D)]
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N + 1
O' = the new exercise price of the Executive Option.
O = the exercise price of the Executive Option which would apply but
for this formula.
E = the number of Shares into which one Executive Option is
exercisable.
Note: E is one unless the number has changed pursuant to Rule
6.2(i) because of a bonus issue.
P = the Market Value of a Share.
S = the subscription price for a Share under the pro rata issue.
D = the dividend due but not yet paid on the existing Shares (except
those to be issued under the pro rata issue).
N = the number of Shares with rights or entitlements that must be
held to receive a right to one new security under the pro rata
issue.
(i) (Bonus issue) Subject to the Listing Rules, if there is a bonus issue to
the holders of Shares, the number of Shares over which the Executive Option
is exercisable may be increased by the number of Shares which the Holder of
the Executive Option would have received if the Executive Option had been
exercised before the record date for the bonus issue.
(j) (Reorganisation of Executive Options) Subject to the Listing Rules, if any
reorganisation of the issued capital of the Company takes place
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8.
prior to the Expiry Date, the number of Executive Options to which each
Holder is entitled and the exercise price will be reorganised as follows:
(A) in a consolidation of capital, the number of Executive Options will be
consolidated in the same ratio as the Shares and the Exercise Price
will be amended in inverse proportion to that ratio;
(B) in a sub-division of capital, the number of Executive Options will be
sub-divided in the same ratio as the Shares and the Exercise Price
will be amended in inverse proportion to that ratio;
(C) in a return of capital, the number of Executive Options must remain
the same and the Exercise Price of each Executive Options must be
reduced by the same amount as the amount returned in relation to each
Share;
(D) in a reduction of capital by a cancellation of paid up capital that is
lost or not represented by available assets where no securities are
cancelled, the number of Executive Options and the Exercise Price must
remain unaltered;
(E) in a pro rata cancellation of Shares, the number of Executive Options
must be reduced in the same ratio as the ordinary capital and the
Exercise Price of each Executive Option will be amended in inverse
proportion to that ratio;
(F) in any other case, the number of Executive Options or the Exercise
Price will be reorganised so that the holder of the Executive Option
will not receive a benefit that holders of Shares do not receive. This
Rule does not prevent a rounding up of the number of Shares to be
received on exercise if the rounding up is approved at the
shareholders' meeting which at the reorganisation is approved; and
in all other respects the terms of the exercise of Executive Options will
remain unchanged.
(k) (Ranking) All Shares issued upon exercise of the Executive Options will
rank equally in all respects with the Company's then existing fully paid
Shares. If the Company has been admitted to the official list of the ASX,
the Company will apply for official quotation by ASX of all Shares issued
upon exercise of the Executive Options.
(l) (Non-transferability) The Executive Options are not transferable and if the
Company is admitted to the official list of ASX no application will be made
to the ASX for official quotation of the Executive Options.
7. SUPERVENING EVENTS
7.1 Notwithstanding anything in these Rules, if, prior to the Company becoming
Listed, during the life of an Executive Option the Board resolves that
there has been, or is likely to be, a Supervening Event the Company will
give notice of
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9.
the Supervening Event to each Holder (Termination Notice). For the avoidance of
doubt, the Board is not obliged to determine that an event which might satisfy
the circumstances under the definition of Supervening Event constitutes a
Supervening Event and may specifically determine that a particular event will
not be treated as a Supervening Event.
7.2 The Termination Notice must specify the nature of the Supervening Event and
the Board's reasons for resolving that the fact matter or circumstance
amounts to a Supervening Event that triggers the operation of this Rule.
The Termination Notice must specify the alternative method of compensating
Holders of Executive Options as determined by the Board under Rule 7.4.
7.3 Upon receipt of a Termination Notice all unexercised Executive Options will
immediately lapse and this Plan will be terminated.
7.4 Upon resolving that there has been, or is likely to be, a Supervening
Event, the Board must also determine the most appropriate method of
compensating Holders of Executive Options that lapse under this Rule 7 from
the following options. The Board may resolve to:
(a) pay each Holder an amount equal to the Equivalent Value of the
Executive Options on the date of the Termination Notice; or
(b) procure that shares are issued in a Related Body Corporate of the
Company such that:
(i) the Market Value of the shares to be issued is equal to the
Market Value of the Shares that would have been issued had the
Executive Options been exercised; and
(ii) the amount payable by the Holder in relation to the shares is
equal to the Exercise Price of the Executive Options; and
(iii) notwithstanding the foregoing the shares shall be credited as
fully paid; or
(c) Procure that common stock in the capital of Genesee & Wyoming Inc. be
issued to the Holder such that:
(i) the Market Value of the common stock to be issued is equal to
the Market Value of the Shares that would have been issued had
the Executive Options been exercised; and
(ii) the amount payable by Holder in relation to the common stock is
equal to the Exercise Price of the Executive Options; and
(iii) notwithstanding the foregoing the common stock shall be credited
as fully paid.
8. EXERCISE OF EXECUTIVE OPTIONS
Unless Executive Options have lapsed under Rule 7 all Executive Options
shall be exercisable in accordance with this Rule 8 as follows:
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10.
(a) (Not Listed and No Trade Sale - Options are exercisable and Compulsory
Buy Back) If, prior to the Expiry Date with respect to an Executive Option,
the Company does not become Listed and a Trade Sale does not occur then an
Executive Option is exercisable on the Expiry Date for a period of one week
from the Expiry Date. If the Executive Option is not exercised during that
period it will automatically lapse. If the Executive Option is exercised
during that period the Company will, if possible under the Corporations
Law, buy back the Shares issued to the Holder on exercise not earlier than
6 months after the date the Shares are issued for an amount equal to the
value of the Shares as determined by an Independent Expert.
(b) (Listed prior to Expiry) If prior to the Expiry Date of an Executive Option
the Company becomes Listed the Executive Option will be exercisable during
the period:
(i) commencing on the date the Company is admitted to the official list of
the ASX; and
(ii) ending on the Expiry Date.
Notwithstanding the provisions of sub-clause (b) and subject to ASX Listing
Rules, if within [12] months of exercising an Executive Option an Executive
ceases employment with the Company and commences working for a business
determined by the Board to be a competitor of the Company he shall be
deemed to have appointed the [company secretary] as his agent and attorney
for the purpose of selling his Shares with authority to execute on his
behalf a share transfer and to take all such steps as necessary to effect
the share transfer. Such Shares shall be transferred during the ordinary
course of trading on ASX and the proceeds, less any costs, shall be paid to
the Executive. The Company shall be entitled to retain any share
certificates issued following the exercise of Executive Options for a
period of [12] months following the date of exercise.
(c) (Trade Sale Prior to Expiry) If, prior to the Expiry Date of an Executive
Option and prior to the Company becoming Listed, the board forms the view
that a Trade Sale is likely to occur, the Company must give notice to the
Holder of the Executive Option of the Trade Sale and the date on which the
Trade Sale is likely to occur, being no less than 10 Business Days from the
date of the notice. The Executive Option will be exercisable in the period:
(i) commencing on the date the notice is received; and
(ii) ending on the date specified in the notice being no less than 5
Business Days before the date of the Trade Sale.
The Company must procure that the purchaser of the shares in the capital of
the Company also purchases the Shares issued upon exercise of Executive
Options under this clause 8(c) at the Market Value for a Trade Sale.
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11.
(d) (Change of Control while Listed) If, during the life of an Executive
Option and provided the Company is admitted to the official list of
ASX, a takeover offer is made for the Shares and the Board becomes
aware that more than 25% of the issued Shares have or will become
vested in the offeror and its associates, the Company will give notice
of the takeover offer to each Holder. Each Holder may then exercise
any unexercised Executive Options within 5 Business Days of the
notice. All unexercised Executive Options will expire 6 Business Days
after the date the notice is received by the Holder.
9. EXERCISE PRICE OF EXECUTIVE OPTIONS
The Exercise Price of an Executive Option will be the amount determined by
the Board and specified in an Offer Notice given under clause 5.4 for that
Executive Option being:
(a) the Market Value of a Share as at the date on which the Executive
Options are granted under clause 5; or
(b) such lower or higher amount as the board determines.
10. MAXIMUM AND MINIMUM NUMBER OF EXECUTIVE OPTIONS
10.1 If the Company is Listed, Executive Options may not be granted under the
Plan if:
(a) immediately following a grant, the number of Shares the subject of
the grant of Executive Options when aggregated with:
(i) the number of Shares which would be issued if each outstanding
Executive Option were to be exercised; and
(ii) the number of Shares issued during the previous five years under
the Plan or any other employee share plan extended only to
employees of the Company (including Directors) and its Related
Bodies Corporate,
(disregarding any offer or option acquired or share issued following
the making or an offer, which is exempt from the disclosure
requirements in Chapter 6D of the Corporations Law) exceeds five
percent of the total number of issued shares in that class in the
Company as at the time of grant of those Executive Options; or
(b) if that grant would cause the Company to be in breach of the Listing
Rules (including Listing Rules 7.1 or 7.16).
10.2 The number of Executive Options exercised by Holder must be at least equal
to a Marketable Parcel of the Shares the subject of the Executive Options.
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12.
11. MAXIMUM NUMBER OF EXECUTIVE OPTIONS TO AN ELIGIBLE PERSON
Executive Options may not be granted under the Plan if, immediately
following the grant, the number of Shares the subject of the grant of
Executive Options when aggregated with:
(a) a number of Shares which would be issued if each outstanding Executive
Option to acquire Shares under the Plan were to be exercised; and
(b) the number of Shares previously acquired under the Plan or otherwise;
would result in an Eligible Person's legal or beneficial interest in the
total capital of the Company exceeding five per cent.
12. CEASING TO BE EMPLOYED
12.1 If a Holder ceases to be employed by the Company or a Related Body
Corporate of the Company:
(a) due to death, disability or retirement (from the age of 55), the
Executive Options of that Holder will lapse and the Holder (or his or
her estate) will be entitled to a cash payment equal to the
Equivalent Value of the Executive Options held by the Holder; and
(b) in all other cases, the Executive Options of that Holder will
immediately lapse.
12.2 A person is deemed to cease employment with the Company or a Related Body
Corporate of the Company due to disability if that person is, in the
opinion of the Board, substantially absent from work due to illness for a
period in excess of 3 consecutive months.
13. OPTION CERTIFICATE
The Company must, within 10 Business Days of the date of grant of the
Executive Options deliver to the grantee an Option Certificate for the
relevant number of Executive Options marked "Non-transferable. Not granted
Official Quotation".
14. REQUESTS FOR INFORMATION
The Company must, within a reasonable period after the receipt of a
request, during any period in which the offer of Executive Options remains
open to an Eligible Person, provide to that Eligible Person in writing the
following information:
(a) the current market price of the Shares; and
(b) where the Exercise Price is determinable at some future time by
reference to a formula, the Australian dollar equivalent of the
acquisition price were that formula applied as at that date.
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13.
15. AMENDMENTS TO THE RULES
These Rules may be amended from time to time by resolution of the Board,
subject to, for as long as the Company is admitted to the official list of
the ASX, obtaining any necessary approval of shareholders required by the
Listing Rules.
16. CORPORATIONS LAW
16.1 This Rule 16 does not apply for so long as the Executive Options offered
under this Plan are offered under a Disclosure Document in accordance with
Chapter 6D of the Corporations Law or the Company has been granted relief
from the disclosure requirements of the Corporations Law.
16.2 This Plan is subject to the provisions of the Corporations Law. Without
limiting the generality of the foregoing, no Executive Option may be
offered and no Share may be issued upon the exercise of an Executive
Option unless that offer is exempt from the disclosure requirement of the
Corporations Law or the Company determines in its absolute discretion to
comply with those requirements.
17. RIGHTS OF EMPLOYEES
The Plan will not form any part of any contract of employment between the
Company or an Related Body Corporate and any Eligible Person and will not
confer directly or indirectly on any Eligible Person any legal or
equitable right whatsoever (other than rights as the holder of Executive
Options or Shares issued under the Plan) against the Company or any
Related Body Corporate.
18. TERMINATION OF THE PLAN
The Board may at any time by resolution terminate the Plan without
prejudice to any Executive Options previously granted.
19. GOVERNING LAW
This agreement is governed by the law in force in South Australia and the
parties submit to the non-exclusive jurisdiction of the courts of South
Australia and all courts competent to hear appeals from the courts of
South Australia in respect of all proceedings arising in connection with
this agreement.
These Rules were adopted by the Directors of the Company under a
resolution of the Directors on September 27 , 2000.
/s/ Ian James D. Jamieson
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Secretary
