Exhibit 99.6
CHARTWELL RE CORPORATION
AMENDED
1996 NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN
1. Purposes
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Chartwell Re Corporation (the "Company") desires to attract
and retain the services of outstanding non-employee directors by affording them
an opportunity to acquire a proprietary interest in the Company through
automatic, non-discretionary awards of stock options ("Options") exercisable to
purchase shares of Common Stock (as defined below), and thus to create in such
directors an increased interest in and a greater concern for the welfare of the
Company and its subsidiaries.
The Options offered pursuant to this 1996 Non-Employee
Directors Stock Option Plan (the "Plan") are a matter of separate inducement and
are not in lieu of any other compensation for the services of any director.
The Options granted under the Plan are intended to be options
that do not meet the requirements for incentive stock options within the meaning
of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
As used in the Plan, the term "parent corporation" and
"subsidiary corporation" shall mean a corporation coming within the definition
of such terms contained in Sections 424(e) and 424(f) of the code, respectively.
2. Amount of Stock Subject to the Plan
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Options granted under the Plan shall be exercisable for shares
of common stock of the Company ("Common Stock"). Initially, and for so long as
the Company continues to have authorized Common Stock, par value $.01 per share
("Ordinary Common Stock"), Options granted under the Plan shall be exercisable
for shares of Common Stock. If at any time there is more than one class of
Common Stock, the Shares (as defined below) shall be the class designated by the
Board of Directors pursuant to its authority under Section 4.
The total number of shares of Common Stock authorized for
issuance under the Plan upon the exercise of Options (the "Shares"), shall not
exceed, in the aggregate, 50,000 of the currently authorized shares of Common
Stock of the Company, such number to be subject to adjustment in accordance with
Section 13.
Shares which may be acquired under the Plan may be either
authorized but unissued Shares, Shares of issued stock held in the Company's
treasury, or both. If and to the extent that Options granted under the Plan
expire or terminate without having been exercised, the Shares covered by such
expired or terminated Options may again be subject to a later-granted Option
under the Plan.
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3. Effective Date and Term of the Plan
-----------------------------------
The Plan shall become effective at 5:00 p.m., New York City
time, on January 1, 1996 (the "Effective Date"); provided, however, that if the
Plan is not approved by a vote of the stockholders of the Company at an annual
meeting or any special meeting of stockholders within twelve months after the
Effective Date, the Plan and any Options granted hereunder shall terminate. The
Plan shall terminate at the close of business on December 31, 2006 (the
"Termination Date"), unless sooner terminated in accordance with its terms.
4. Administration
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The Plan shall be administered by the Board of Directors of
the Company (the "Board of Directors"), which may designate from among its
members a committee to exercise all power and authority of the Board of
Directors at any time and from time to time to administer the Plan. (References
herein to the Board of Directors shall be deemed to include references to any
such committee, except as the context otherwise requires.) Subject to the
express provisions of the Plan, the Board of Directors shall have authority to
construe the Plan and the Options granted hereunder, to prescribe, amend and
rescind rules and regulations relating to the Plan and to make all other
ministerial determinations necessary or advisable for administering the Plan;
provided, however, that no director shall participate in any determination to be
made by the Board of Directors with respect to his or her own participation in
or benefits under the Plan.
The determination of the Board of Directors on matters
referred to in this Section 4 shall be conclusive.
5. Eligibility
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All non-employee directors of the Company (including former
officers or former key employees), shall be eligible to be granted Options under
the Plan ("Eligible Directors").
6. Option Grants
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On the Effective Date, each Eligible Director then in office
shall automatically be granted an Option to purchase 1,000 Shares (subject to
adjustment as provided in Section 13), subject to the approval of the Plan by
the stockholders of the Company at the 1996 Annual Meeting. Thereafter,
effective on the date of each annual meeting of stockholders of the Company
during the term of the Plan commencing with the 1997 Annual Meeting of
Stockholders, each Eligible Director then in office shall automatically be
granted, immediately following each such annual meeting of stockholders of the
Company, an Option to purchase 1,000 Shares (subject to adjustment as provided
in Section 13), with the date of the grant to be the date of such annual
meeting.
7. Option Price and Payment
------------------------
The price for each Share purchasable upon exercise of any
Option granted hereunder on the Effective Date shall be an amount equal to the
fair market value per Share on the Effective Date. The price for each Share
purchasable upon exercise of any Option granted hereunder on the date of any
annual meeting of stockholders during the term of the Plan commencing with the
1997 Annual Meeting of Stockholders shall be an amount equal to the fair market
value per Share on the date of grant. For purposes of the Plan, fair market
value per Share shall be determined as follows:
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(a) If the Shares are listed on a national securities exchange in the
United States or reported on the National Association of Securities Dealers
Automated Quotation System-National Market System ("NASDAQ-NMS") on any date on
which the fair market value per Share is to be determined, the fair market value
per Share shall be deemed to be the closing quotation at which such Shares are
sold on such principal national securities exchange or reported on NASDAQ-NMS on
the date the Option is granted. If the Shares are listed on a national
securities exchange in the United States on such date or reported on NASDAQ-NMS
but no Shares are traded on such date, or such national securities exchange or
NASDAQ-NMS is not open for business on such date, the fair market value per
Share shall be determined as of the closest date preceding on which the Shares
were so traded.
(b) If on the date any Option is granted, a regular, active public
market exists (as determined in the sole discretion of the Board of Directors,
whose decision shall be conclusive and binding) for the Shares but such Shares
are not listed on a national securities exchange in the United States or
reported on NASDAQ-NMS, the fair market value per Share shall be deemed to be
the average of the closing bid and ask quotations in the over-the-counter market
for such Shares in the United States on the date such Option is granted. In the
event that there are no bid and ask quotations in the over-the-counter market in
the United States for such Shares on the date such Option is granted, the fair
market value per Share shall be determined as of the closest preceding date on
which such quotations are available. For purposes of the foregoing, a market in
which trading is sporadic and the ask quotations generally exceed the bid
quotations by more than 15% shall not be deemed to be a "regular, active public
market." If the Board of Directors determines that a regular, active public
market does not exist for the Shares, the Board of Directors shall determine the
fair market value per Share in its good faith judgment.
Upon the exercise of an Option granted hereunder, the Company
shall cause the purchased Shares to be issued to the Eligible Director when it
shall have received any one, or combination of the following: (1) the full
purchase price for the Shares from the optionee in cash; (2) Common Stock (in
proper form for transfer and accompanied by all requisite stock transfer tax
stamps or cash in lieu thereof) already owned by such optionee and having a fair
market value equal to the cash exercise price applicable to that portion of the
Option being exercised by the delivery of such shares, the fair market value per
each share of Common Stock so delivered to be determined as of the date
immediately preceding the date on which the Option is exercised in accordance
with paragraphs (a) and (b) of this Section 7, or as may be required in order to
comply with or to conform to the requirements of any applicable laws or
regulations or (3) written notice to the Company to withhold from those shares
of Common Stock that would otherwise be obtained upon such stock option
exercise, a number of shares having a fair market value on the date of exercise
equal to the option exercise price.
8. Terms of Options and Limitations on the Right of Exercise
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To the extent that an Option is not exercised within the
period of exercisability specified therein, it shall expire as to the then
unexercised part.
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In no event shall an Option granted hereunder be exercised for
a fraction of a Share or for less than one hundred Shares (unless the number
purchased is the total balance for which the Option is then exercisable).
A person entitled to receive Shares upon the exercise of an
Option shall not have the rights of a stockholder with respect to such Shares
until the date of issuance of a stock certificate to him or her for such Shares;
provided, however, that until such stock certificate is issued, any holder of an
Option using previously acquired shares of Common Stock in payment of an Option
exercise price shall continue to have the rights of a stockholder with respect
to such previously acquired shares of Common Stock.
9. Option Period and Exercise of Options
-------------------------------------
An Option granted to any Eligible Director shall not be
exercisable for six (6) months following the date of grant of such Option and
shall be exercisable for the period ending ten (10) years from the date of such
grant, except to the extent such exercise is further limited or restricted
pursuant to the provisions hereof.
Subject to the express provisions of the Plan, Options granted
under the Plan shall be exercised by the optionee as to all or part of the
Shares covered thereby by the giving of written notice of the exercise thereof
to the Corporate Secretary of the Company at the principal business office of
the Company, specifying the number of Shares to be purchased, whether the
payment is proposed to be in the form of cash or shares of Common Stock and
specifying a business day of the Company which is not more than ten (10) days
from the date such notice is given for the payment of the purchase price against
delivery of the Shares being purchased. Subject to the terms of Sections 15, 16
and 17, the Company shall cause certificates for the Shares so purchased to be
delivered at the principal business office of the Company, against payment of
the full purchase price, on the date specified in the notice of exercise.
10. Termination of Directorship
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If an Eligible Director's service as a director of the Company
is terminated, any Option previously granted to such Eligible Director shall, to
the extent not theretofore exercised, terminate and become null and void;
provided, however, that:
(a) if an Eligible Director holding an outstanding Option dies,
including during either the three (3) month or one (1) year period, whichever is
applicable, specified in clause (b) immediately below, such Option shall, to the
extent not theretofore exercised, remain exercisable for one (1) year after such
Eligible Director's death, by such Eligible Director's legatee, distributee,
guardian or legal or personal representative; and
(b) if the service with the Company of an Eligible Director holding an
outstanding Option is terminated by reason of (i) such Eligible Director's
disability (as described in Section 22(e) (3) of the Code), (ii) voluntary
retirement from service as a director of the Company or (iii) failure of the
Company to nominate for re-election such Eligible Director who is otherwise
eligible, except if such failure to nominate for reelection is due to any act of
(A) fraud or intentional misrepresentation or (B) embezzlement, misappropriation
or conversion of assets or opportunities of the Company or any subsidiary
corporation or parent corporation of the Company (in which case, such Option
shall terminate and no longer be exercisable), such Option shall, to the extent
not theretofore exercised, remain exercisable for (X) three (3) months after the
date of such termination of service in the case of termination by reason of
voluntary retirement or failure of the Company to nominate for re-election such
Eligible Director who is otherwise eligible, subject to the above exceptions
thereto stated in this clause (b), and (Y) one (1) year after the date of
termination of service in the case of termination by reason of disability.
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In no event, however, shall an Eligible Director be entitled
to exercise any Option after the expiration of the period of exercisability of
such Option, as specified therein.
11. Use of Proceeds
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The cash proceeds from the sale of Shares subject to the
Options granted hereunder are to be added to the general funds of the Company
and used for its general corporate purposes as the Board of Directors shall
determine.
12. Non-Transferability of Options
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An Option granted hereunder shall not be transferable, whether
by operation of law or otherwise, other than by will or the laws of descent and
distribution pursuant to clause (a) of Section 10. Except to the extent provided
above, Options also may not be assigned, transferred, pledged, hypothecated or
disposed of in any way (whether by operation of law or otherwise) and shall not
be subject to execution, attachment or similar process.
13. Adjustment of Shares
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Notwithstanding any other provision contained herein, in the
event of any change in the Shares subject to the Plan or to any Option granted
under the Plan (through merger, consolidation, reorganization, recapitalization,
stock dividend, stock split, split-up, split-off, spin-off, combination of
shares, exchange of shares, or other like change in the capital structure of the
Company), an adjustment shall be made to each outstanding Option to the effect
that each such Option shall thereafter be exercisable for such securities, cash
and/or other property as would have been received in respect of the Shares
subject to such Option had such Option been exercised in full immediately prior
to such change, and such an adjustment shall be made successively each time any
such change shall occur. The term "Shares" after any such change shall refer to
the securities, cash and/or property then receivable upon exercise of an Option.
In addition, in the event of any such change, the Board of Directors shall make
any further adjustment to the maximum number of Shares which may be acquired
under the Plan pursuant to the exercise of Options, the maximum number of shares
for which Options may be granted to any one (1) Eligible Director and the number
of Shares and price per Share subject to outstanding Options as shall be
equitable to prevent dilution or enlargement of rights under such Options, and
the determination of the Board of Directors as to these matters shall be
conclusive and binding on the optionee.
14. Right to Terminate Service
--------------------------
The Plan shall not impose any obligation on the Company or on
any subsidiary corporation or parent corporation thereof to continue the service
of any director holding Options and shall not impose any obligation on the part
of any director holding Options to remain in the service of the Company or of
any subsidiary corporation or parent corporation thereof.
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15. Purchase for Investment
-----------------------
Except as hereinafter provided, the Board of Directors may
require the holder of an Option granted hereunder, as a condition to exercise of
such Option in the event the Shares subject to such Option are not registered
pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "Securities Act"), and applicable state securities laws,
to execute and deliver to the Company a written statement, in form satisfactory
to the Board of Directors, in which such holder (a) represents and warrants that
such holder is purchasing or acquiring the Shares acquired thereunder for such
holder's own account for investment only and not with a view to the resale or
distribution thereof in violation of any federal or state securities laws and
(b) agrees that any subsequent resale or distribution of any of such Shares
shall be made only pursuant to either (i) an effective registration statement
covering such Shares under the Securities Act and applicable state securities
laws or (ii) specific exemptions from the registration requirements of the
Securities Act and any applicable state securities laws, based on a written
opinion of counsel, in form and substance satisfactory to counsel for the
Company, as to the application thereto of any such exemptions.
Nothing herein shall be construed as requiring the Company to
register Shares subject to any Option under the Securities Act or any state
securities law and, to the extent deemed necessary by the Company, Shares issued
upon exercise of an Option may contain a legend to the effect that registration
rights have not been granted with respect to such Shares.
16. Issuance of Stock Certificates; Legends; Payment of Expenses
------------------------------------------------------------
The Company may endorse such legend or legends upon the
certificates for Shares issued upon exercise of Options granted pursuant to the
Plan and may issue such "stop transfer" instructions to its transfer agent in
respect of such Shares as the Board of Directors, in its discretion, determines
to be necessary or appropriate to (a) prevent a violation of, or to perfect an
exemption from, the registration requirements of the Securities Act or (b)
implement the provisions of the Plan and any agreement between the Company and
the optionee or grantee with respect to such Shares.
The Company shall pay all issue and transfer taxes with
respect to the issuance or transfer of Shares, as well as all fees and expenses
necessarily incurred by the Company in connection with such issuance or
transfer.
All Shares issued as provided herein shall be fully paid and
nonassessable to the extent permitted by law.
17. Listing of Shares and Related Matters
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If at any time the listing, registration or qualification of
the Shares subject to an Option on any securities exchange or under any
applicable law, or the consent or approval of any governmental regulatory body,
is necessary as a condition of, or in connection with, the granting of the
Option, or the issuance of Shares thereunder, such Option may not be exercised
in whole or in part unless such listing, registration, qualification, consent or
approval shall have been effected or obtained.
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18. Amendment of the Plan
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The Board of Directors may, from time to time, amend the Plan,
provided that no amendment shall be made without the approval of the
stockholders of the Company that will (a) increase the total number of Shares
reserved for Options under the Plan (other than an increase resulting from an
adjustment provided for in Section 13), (b) modify the provisions of the Plan
relating to eligibility, or (c) materially increase the benefits accruing to
participants under the Plan. Notwithstanding any other provision hereof, in no
event shall the provisions of the Plan be amended more than one time in any
six-month period, other than to comport with changes to the applicable law or
the rules promulgated thereunder.
19. Termination or Suspension of the Plan
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The Board of Directors may at any time suspend or terminate
the Plan. Options may not be granted while the Plan is suspended or after it is
terminated. Rights and obligations under any Option granted while the Plan is in
effect shall not be altered or impaired by suspension or termination of the
Plan, except upon the consent of the person to whom the Option was granted. The
ministerial power of the Board of Directors to construe and administer any
Options under Section 4 that are granted prior to the termination or the
suspension of the Plan shall continue after such termination or during such
suspension.
20. Savings Provision
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With respect to all participants in the Plan, transactions
under the Plan are intended to comply with all applicable conditions of Rule
16b-3 (or any successor provision) under the Exchange Act. To the extent any
provision of the Plan term of any Option or action by the Board of Directors
fails to so comply, it shall be deemed amended so as to be consistent with the
requirements of said Rule 16b-3 and, to the extent such amendment shall not
suffice for purposes of such compliance, it shall be deemed null and void to the
extent permitted by law and deemed advisable by the Board of Directors.
21. Governing Law
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The Plan, such Options as may be granted hereunder and all
related matters shall be governed by, and construed and enforced in accordance
with, the laws of the State of Delaware from time to time in effect.
22. Partial Invalidity
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The invalidity or illegality of any provision herein shall not
be deemed to affect the validity of any other provision.
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23. Cancellation and Substitution of Options Upon Merger
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Notwithstanding anything to the contrary contained in the
Plan, at the time of the merger (the "Effective Time") of the Company with and
into Trenwick Group Inc. ("Trenwick"), pursuant to the terms of the Agreement
and Plan of Merger between Trenwick and the Company, dated as of June 21, 1999
(the "Merger Agreement"), each outstanding Option under the Plan, whether or not
then vested or exercisable, shall be assumed by Trenwick and converted into an
option to acquire, on the same terms and conditions as were applicable under
such Option prior to the Effective Time, the number (rounded down to the nearest
whole number) of shares of Trenwick common stock, par value $.10 per share (the
"Trenwick Common Stock") determined by multiplying (x) the number of shares of
Common Stock subject to such Option immediately prior to the Effective Time by
(y) 0.825, at a price per share of Trenwick Common Stock (rounded up to the
nearest whole cent) equal to (A) the current price for each Share purchaseable
upon exercise of any Option granted under the Plan divided by (b) 0.825.
24. Cancellation and Substitution of Options Upon Business Combination
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Notwithstanding anything to the contrary contained in the Plan, at the
"Effective Time" (as defined in the Amended and Restated Agreement, Schemes of
Arrangement and Plan of Reorganization among LaSalle Re Holdings Limited,
LaSalle Re Limited, the Company and Trenwick Group Ltd., formerly Gowin Holdings
International Limited ("Trenwick Bermuda") dated as of March 20, 2000 (the
"Business Combination Agreement")), each outstanding Option under the Plan,
whether or not then vested or exercisable, shall be assumed by Trenwick and
converted into an option to acquire, on the same terms and conditions as were
applicable under such Option prior to the Effective Time, an equivalent number
of "New Holdings Shares" (as defined in the Business Combination Agreement).
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