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EXHIBIT 10.1
WATER PIK TECHNOLOGIES, INC.
1999 NON-EMPLOYEE DIRECTOR STOCK
COMPENSATION PLAN, AS AMENDED
ARTICLE I.
GENERAL
1.1. Purpose. It is the purpose of the Plan to promote the interests of
the Company and its stockholders by attracting, retaining and providing an
incentive to Non-Employee Directors through the acquisition of a proprietary
interest in the Company and an increased personal interest in its performance.
This purpose will be served by:
(a) providing an opportunity for Non-Employee Directors to
elect to receive Common Stock in lieu of Director's Retainer Fee Payments with
automatic payment of a portion of the Director's Retainer Fee Payment in the
form of Common Stock to those Non-Employee Directors not electing to receive
such portion in the form of Common Stock;
(b) granting each Non-Employee Director annually an option
covering 1,000 shares of Common Stock;
(c) granting each Non-Employee Director on a one-time basis an
option covering 5,000 shares of Common Stock; and
(d) granting each Non-Employee Director on a one-time basis
restricted Common Stock in the amount of 3,000 shares.
1.2. Adoption and Term. The Plan has been approved by the Board and
shall become effective as of the Effective Date (as hereinafter defined). The
Plan shall terminate without further action upon the earlier of (a) the tenth
anniversary of the effective date, and (b) the first date upon which no shares
of Common Stock remain available for issuance under the Plan.
1.3. Definitions. As used herein the following terms have the following
meanings:
(a) "Annual Options" means the Stock Options issuable under
Section 4.4(b) of the Plan.
(b) "Board" means the Board of Directors of the Company.
(c) "Change of Control" means any of the events set forth
below:
(i) The acquisition in one or more transactions,
other than from the Company, by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of a number of Company Voting Securities in excess of 25% of the Company Voting
Securities unless such acquisition has been approved by the Board; or
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(ii) Any election has occurred of persons to the
Board that causes two-thirds of the Board to consist of persons other than (A)
persons who were members of the Board on January 1, 2000 and (B) persons who
were nominated for election as members of the Board at a time when two-thirds of
the Board consisted of persons who were members of the Board on January 1, 2000;
provided, however, that any person nominated for election by the Board at a time
when at least two-thirds of the members of the Board were persons described in
clauses (A) and/or (B) or by persons who were themselves nominated by such Board
shall, for this purpose, be deemed to have been nominated by a Board composed of
persons described in clause (A); or
(iii) Approval by the stockholders of the Company of
a reorganization, merger or consolidation, unless, following such
reorganization, merger or consolidation, all or substantially all of the
individuals and entities who were the respective beneficial owners of the
Outstanding Stock and Company Voting Securities immediately prior to such
reorganization, merger or consolidation, following such reorganization, merger
or consolidation beneficially own, directly or indirectly, more than 75% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors or trustees, as the case may be, of the
entity resulting from such reorganization, merger or consolidation in
substantially the same proportion as their ownership of the Outstanding Stock
and Company Voting Securities immediately prior to such reorganization, merger
or consolidation, as the case may be; or
(iv) Approval by the stockholders of the Company of
(A) a complete liquidation or dissolution of the Company or (B) a sale or other
disposition of all or substantially all the assets of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as
amended. References to a section of the Code shall include that section and any
comparable section or sections of any future legislation that amends,
supplements or supersedes said section.
(e) "Common Stock" means the common stock, par value $0.01 per
share, of the Company.
(f) "Company" means Water Pik Technologies, Inc., a Delaware
corporation, and any successor thereto.
(g) "Compensation Year" means each calendar year or portion
thereof during which the Plan is in effect.
(h) "Director" means a member of the Board.
(i) "Director's Retainer Fee Payment" means the dollar value
of that portion of the annual retainer fee payable by the Company to a
Non-Employee Director for serving as a Director and for serving as the chair of
the Board or any committee of the Board as of a particular Payment Date, as
established by the Board and in effect from time to time.
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(j) "Disability" means any physical or mental injury or
disease of a permanent nature which renders a Non-Employee Director incapable of
meeting the requirements of the duties performed by such Non-Employee Director
for the Company immediately prior to the commencement of such disability. The
determination of whether a Non-Employee Director is disabled shall be made by
the Board in its sole and absolute discretion.
(k) "Effective Date" means the effective date of the
distribution by Allegheny Teledyne Incorporated to its stockholders of the
Common Stock.
(l) "Employee" means any employee of the Company or an
affiliate.
(m) "Exchange Act" means the Securities Exchange Act of 1934,
as amended. References to a section of the Exchange Act or rule promulgated
thereunder shall include that section or rule and any comparable section(s) or
rule(s) of any future legislation or rulemaking that amends, supplements or
supersedes said section or rule.
(n) "Fair Market Value" means, as of any given date, the
average of the high and low trading prices of the Common Stock on such date as
reported on the New York Stock Exchange, or, if the Common Stock is not then
traded on the New York Stock Exchange, on such other national securities
exchange on which the Common Stock is admitted to trade, or, if none, on the
National Association of Securities Dealers Automated Quotation System if the
Common Stock is admitted for quotation thereon; provided, however, if there were
no sales reported as of such date, Fair Market Value shall be computed as of the
last date preceding such date on which a sale was reported; provided, further,
that if any such exchange or quotation system is closed on any day on which Fair
Market Value is to be determined, Fair Market Value shall be determined as of
the first date immediately preceding such date on which such exchange or
quotation system was open for trading.
(o) "First Amendment Date" means the date, June 28, 2000, when
the Plan was first amended.
(p) "Initial Option" means the Stock Options issuable under
Section 4.4(a) of the Plan.
(q) "Non-Employee Director" means a Director who is not an
Employee.
(r) "Non-Employee Director Notice" means a written notice
delivered in accordance with Section 4.2.
(s) "Option Period" means the term of the Stock Option set
forth in Section 4.4 (c) of the Plan.
(t) "Payment Date" means the first business day of January and
July of each Compensation Year on which the cash portion of the Director's
Retainer Fee Payment
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for serving as a Director is paid by the Company and the first business day of
January of each Compensation Year on which the Director's Retainer Fee Payment
for serving as the chair of the Board or any committee of the Board is paid by
the Company.
(u) "Plan" means this Water Pik Technologies, Inc. 1999
Non-Employee Director Stock Compensation Plan, as it may hereafter be amended
from time to time.
(v) "Restricted Stock" means shares of Common Stock awarded to
a Non-Employee Director subject to restrictions as described in Section 4.5 of
the Plan.
(w) "Retirement" means voluntary or involuntary resignation
from the Board at or after the third annual meeting of shareholders of the
Company held during calendar year 2002.
(x) "Stock Options" means options to purchase shares of Common
Stock of the Company issuable hereunder.
1.4. Shares Subject to the Plan. The shares to be offered under the
Plan shall consist of the Company's authorized but unissued Common Stock or
treasury shares and, subject to adjustment as provided in Section 5.1 hereof,
the aggregate amount of such stock which may be issued or subject to Stock
Options issued hereunder shall not exceed 100,000 shares. If any Stock Option
granted under the Plan shall expire or terminate for any reason, without having
been exercised or vested in full, as the case may be, the unpurchased shares
subject thereto shall again be available for issuance under the Plan. Stock
Options granted under the Plan will not be qualified as "incentive stock
options" under Section 422 of the Code.
ARTICLE II.
ADMINISTRATION
2.1. The Board. The Plan shall be administered by the Board. Subject to
the provisions of the Plan, the Board shall interpret the Plan, promulgate,
amend, and rescind rules and regulations relating to the Plan and make all other
determinations necessary or advisable for its administration. Interpretation and
construction of any provision of the Plan by the Board shall be final and
conclusive. Notwithstanding the foregoing, the Board shall have or exercise no
discretion with respect to the selection of persons eligible to participate
hereunder, the determination of the number of shares of Common Stock or number
of Stock Options issuable to any person or any other aspect of Plan
administration with respect to which such discretion is not permitted in order
for grants of shares of Common Stock and Stock Options to be exempt under Rule
16b-3 promulgated under the Exchange Act.
ARTICLE III.
PARTICIPATION
3.1. Participants. Each Non-Employee Director shall participate in the
Plan on the terms and conditions hereinafter set forth.
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ARTICLE IV.
PAYMENT OF DIRECTOR'S FEES
4.1. General. The Director's Retainer Fee Payment shall be paid to each
Non-Employee Director, as of each Payment Date, as set forth in the Plan and
subject to such other payment policies and procedures as the Board may establish
from time to time. If, for the applicable Compensation Year, a Non-Employee
Director has not made an election pursuant to Section 4.2 to receive Common
Stock in lieu of at least twenty-five percent (25%) of the Director's Retainer
Fee Payment, then seventy-five percent (75%) of such director's Retainer Fee
Payment shall be paid in cash and twenty-five percent (25%) of the Director's
Retainer Fee Payment shall be paid in the form of Common Stock.
4.2. Non-Employee Director Notice. A Non-Employee Director may file
with the Secretary of the Company or other designee of the Board of Directors
prior to the commencement of a Compensation Year a Non-Employee Director Notice
making an election to receive either twenty-five percent (25%), fifty percent
(50%), seventy-five percent (75%) or one hundred (100%) of his or her Director's
Retainer Fee Payment in the form of Common Stock with the balance to be paid in
cash. If a Director does not timely file an election, he or she shall receive
twenty-five percent (25%) of the Director's Retainer Fee Payment in Common Stock
and seventy-five percent (75%) in cash. Notwithstanding the foregoing, elections
to receive Common Stock may be made at any time during a Compensation Year so
long as such elections are made irrevocably in advance of receiving the
corresponding Common Stock and approved in accordance with Rule 16b-3 under the
Exchange Act.
4.3 Conversion of Retainer Fee Payment to Shares. Each Non-Employee
Director who pursuant to Section 4.1 or 4.2 is to receive Common Stock as all or
part of his or her Director's Retainer Fee Payment with respect to a
Compensation Year and who is elected or reelected or is a continuing
Non-Employee Director as of the date of commencement of such Compensation Year,
shall receive as of the first business day of January during such Compensation
Year a number of shares of Common Stock equal to the quotient obtained by
dividing (i) the amount of the Director's Retainer Fee Payment to be paid in the
form of Common Stock by (ii) the Fair Market Value of the Common Stock per share
on the first business day of January. Cash shall be paid in lieu of any
fractional shares.
4.4 Stock Options
(a) Initial Option Grant. An Initial Option covering 5,000 shares of
Common Stock shall be granted to each Non-Employee Director on his or her first
date of Board service, or on the First Amendment Date for those Non-Employee
Directors serving on the Board on such date. The purchase price of the Common
Stock covered by the Initial Option will be the Fair Market Value of a share of
Common Stock as of the date of grant of the Initial Option.
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(b) Annual Option Grants. An Annual Option covering 1,000 shares of
Common Stock shall be granted to each Non-Employee Director on the Effective
Date, subject to approval by the stockholders of the Company. Thereafter, an
Annual Option covering 1,000 shares of Common Stock will be granted to each
Non-Employee Director automatically at the conclusion of each Company Annual
Meeting. If, after the Effective Date, a director first becomes a Non-Employee
Director on a date other than an Annual Meeting date, an Annual Option covering
1,000 shares of Common Stock will be granted to such director on his or her
first date of Board service. The purchase price of the Common Stock covered by
each Annual Option will be the Fair Market Value of a share of Common Stock as
of the date of grant of the Annual Option.
(c) Duration and Exercise of Stock Options. Subject to Section 4.4(f)
below, Annual Options become exercisable on the first anniversary of the date on
which they were granted, and Initial Options become exercisable in equal
one-third increments on the first, second and third anniversaries of the date on
which they were granted. Stock Options shall terminate upon the expiration of
ten years from the date of grant. No Stock Option may be exercised for a
fraction of a share and no partial exercise of any Stock Option may be for less
than one hundred (100) shares.
(d) Purchase Price. The purchase price for the shares shall be paid in
full at the time of exercise (i) in cash or by check payable to the order of the
Company, (ii) by delivery of shares of Common Stock of the Company already owned
by, and in the possession of Stock Option holder, or (iii) by delivering a
properly executed exercise notice together with irrevocable instructions to a
broker to deliver promptly to the Company the amount of sale or loan proceeds to
pay the Stock Option price (in which case the exercise will be effective upon
receipt of such proceeds by the Company). Shares of Common Stock used to satisfy
the exercise price of a Stock Option shall be valued at their Fair Market Value
on the date of exercise.
(e) Transferability. Stock Options granted hereunder shall not be
transferable, other than by will or the laws of descent and distribution, and
shall be exercisable during a Stock Option holder's lifetime only by the Stock
Option holder or by his or her guardian or legal representative, except to the
extent transfer is (i) permitted by Rule 16b-3 promulgated under the Exchange
Act and (ii) approved by the Board or its designee. Subject to the foregoing,
Stock Options shall not be assigned, pledged or otherwise encumbered by the
holder thereof, either voluntarily or by operation of law.
(f) Termination of Directorship. In the event the Board service of the
Non-Employee Director terminates by reason of death, Disability or Retirement,
or upon the occurrence of a Change in Control, all Stock Options shall become
immediately and fully vested and exercisable. In the event of removal of a
director from the Board of Directors for reasons other than death, Disability or
Retirement, or resignation prior to the third annual meeting of shareholders of
the Company, all rights of such director in a Stock Option that the director was
entitled to exercise on the date of removal or voluntary resignation shall
terminate on the 30th day (or, if such day is not a business day, on the next
business day) after the date of removal. In no event may a Stock Option be
exercised after the earlier to occur of: (i) twelve (12) months after
termination of directorship or (ii) expiration of the period specified in
Section 4.4(c).
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4.5 Restricted Stock.
(a) Restricted Stock Awards. Each Non-Employee Director shall receive
an award of 3,000 shares of Restricted Stock on the First Amendment Date. Each
Non-Employee Director who first becomes a Non-Employee Director following the
First Amendment Date shall receive an award of 3,000 shares of Restricted Stock
on the date that he or she first commences Board service. The terms of all such
Restricted Stock awards shall be set forth in an award agreement between the
Company and each Non-Employee Director which shall contain such forfeiture
periods and conditions, restrictions and other provisions, not inconsistent with
this Article or the Plan, as shall be determined by the Board.
(i) Issuance of Restricted Stock. As soon as practicable after
the date of grant of the Restricted Stock award (the "Date of Grant"), the
Company shall cause to be transferred on the books of the Company shares of
Common Stock, registered on behalf of the Non-Employee Director, evidencing such
Restricted Stock, but subject to forfeiture to the Company retroactive to the
Date of Grant if an award agreement delivered to the Non-Employee Director by
the Company with respect to the Restricted Stock is not duly executed by the
Non-Employee Director and timely returned to the Company. Until the lapse or
release of all restrictions applicable to an award of Restricted Stock, the
stock certificates representing such Restricted Stock shall be held in custody
by the Company or its designee.
(ii) Common Stockholder Rights. Beginning on the Date of Grant
of the Restricted Stock and subject to execution of the award agreement as
provided in Section 4.5 (a)(i) , the Non-Employee Director shall become a
stockholder of the Company with respect to all Common Stock subject to the award
agreement and shall have all of the rights of a stockholder, including, but not
limited to, the right to vote such Common Stock and the right to receive
dividends (or dividend equivalents) paid with respect to such Common Stock;
provided, however, that any Common Stock distributed as a dividend or otherwise
with respect to any Restricted Stock as to which the restrictions have not yet
lapsed shall be subject to the same restrictions as such Restricted Stock and
shall be held as prescribed in Section 4.5 (a)(i).
(iii) Restriction on Transferability. None of the Restricted
Stock may be assigned, transferred (other than by will or the laws of descent
and distribution), pledged, sold or otherwise disposed of prior to lapse or
release of the restrictions applicable thereto.
(iv) Delivery of Common Stock Upon Release of Restrictions.
Upon expiration or earlier termination of the forfeiture period without a
forfeiture and the satisfaction of or release from any other conditions
prescribed by the Board, the restrictions applicable to the Restricted Stock
shall lapse. As promptly as administratively feasible thereafter, the Company
shall deliver to the Non-Employee Director, or, in the case of the Non-Employee
Director's death, to his or her legal representatives, one or more stock
certificates for the appropriate number of shares of Common Stock, free of all
such restrictions, except for any restrictions that may be imposed by law.
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(b) Terms of Restricted Stock.
(i) Forfeiture of Restricted Stock. Subject to Section 4.5
(b)(ii), all Restricted Stock shall be forfeited and returned to the Company and
all rights of the Non-Employee Director with respect to such Restricted Stock
shall cease and terminate in their entirety if during the applicable forfeiture
period: (A) the Non-Employee Director transfers, sells or otherwise disposes of
the Restricted Stock other than in a transaction constituting a Change in
Control, or (B) the Board service of the Non-Employee Director with the Company
terminates for any reason other than death, Disability or Retirement.
(ii) Waiver of Forfeiture Period. Notwithstanding anything
contained in this Section 4.5 to the contrary, the Board may, in its sole
discretion, waive the forfeiture conditions set forth in any award agreement
under appropriate circumstances and subject to such terms and conditions
(including forfeiture of a proportionate number of the shares of Restricted
Stock) as the Board may deem appropriate.
ARTICLE V.
MISCELLANEOUS
5.1. Adjustments Upon Changes in Common Stock. The number and kind of
shares available for issuance under the Plan, and the number and kind of shares
subject to, and the exercise price of, outstanding Stock Options, shall be
appropriately adjusted to prevent dilution or enlargement of rights by reason of
any stock dividend, stock split, combination or exchange of shares,
recapitalization, merger, consolidation or other change in capitalization with a
similar substantive effect upon the Plan or the shares issuable under the Plan.
5.2. Amendment and Termination. The Board shall have complete power and
authority to amend the Plan at any time; provided, however, that the Board shall
not, without the affirmative approval of the stockholders of the Company, make
any amendment which requires stockholder approval under any applicable law or
regulation of a national stock exchange on which the Common Stock is traded. The
Board shall have the right and the power to terminate the Plan at any time. No
amendment or termination of the Plan may, without the consent of the
Non-Employee Director, adversely affect the right of such Non-Employee Director
with respect to any Stock Options then outstanding.
5.3. Requirements of Law. The issuance of Common Stock under the Plan
shall be subject to all applicable laws, rules and regulations and to such
approval by governmental agencies as may be required.
5.4. No Guarantee of Membership. Nothing in the Plan shall confer upon
a Non-Employee Director any right to continue to serve as a Director.
5.5 Construction. Words of any gender used in the Plan shall be
construed to include any other gender, unless the context requires otherwise.
5.6 Governing Law. This Plan shall be governed by, construed and
interpreted in accordance with the laws of the State of Delaware, without regard
to its principles of conflict of law, as to all matters, including matters of
validity, construction, effect, performance and remedies.
Adopted by Board on 11/12/99.
Approved by Shareholder(s) on 11/12/99.
Amended on 6/27/00.
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