Exhibit 4.2
Exhibit B
THE COASTAL CORPORATION
Notice and Election to Participate in
Deferred Compensation Plan for Directors
and Designation of Beneficiary
1. Percentage Deferred. Pursuant to The Coastal Corporation Deferred
Compensation Plan for Directors (the "Plan"), I hereby elect to defer, as
provided in the Plan, the receipt of _____% of the Director's fees payable in
cash and earned by me in connection with the performance of my services as a
member of the Board of Directors of The Coastal Corporation beginning
________________, 199___. (Note: Changes may be made effective only as of
January 1 of a subsequent year, unless an exception described in Section 2 of
the Plan applies.)
2. Deferral Account. Of the amounts I have elected to defer in Section 1
above, I elect to have such amounts credited to my Account(s) as follows:
(a) % Account #1 (Interest Fixed Account) to be credited
with interest as provided in Section 3(a) of the Plan.
(b) % Account #2 (Phantom Stock Account) to be credited in
the form of shares of Phantom Stock, and for each
share of Phantom Stock credited to my account at the
time of this deferral, I shall be granted an option to
purchase a share of Stock, as provided in Section 3(b)
of the Plan.
3. Distribution Election. The proceeds of my Accounts under the Plan are to
be distributed following my termination of service as a member of the Board of
Directors of the Company as follows:
As a single sum upon my termination of service;
In two payments: 50% upon my termination of service, and the
balance on the ____ day of __________________ in the calendar
year following the calendar year of my termination of service;
4. Beneficiary. I hereby designate ______________________________________
as my beneficiary to receive all amounts held for me under the Plan which have
not been paid to me in the event of my death. My Beneficiary's social security
number and address are as follows:
Beneficiary's Social Security Number
Beneficiary's Address
Participant Date
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Exhibit 4.2
THE COASTAL CORPORATION
1997 DIRECTORS STOCK PLAN
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Exhibit 4.2
THE COASTAL CORPORATION
1997 DIRECTORS STOCK PLAN
TABLE OF CONTENTS
1 GENERAL...................................................... 1
1.1 Purpose.................................................. 1
1.2 Administration........................................... 1
1.3 Shares Available Under the Plan.......................... 1
1.4 Authority to Grant Options............................... 1
1.5 General Provisions of Options............................ 2
2 ELIGIBILITY TO PARTICIPATE................................... 2
3 OPTIONS...................................................... 2
3.1 Option Term.............................................. 2
3.2 Vesting.................................................. 3
3.3 Option Price............................................. 3
3.4 Exercise of Options...................................... 3
3.5 Payment of Option Price.................................. 3
3.6 Common Stock Certificates................................ 4
3.7 Nontransferability of Options............................ 4
3.8 No Rights as Shareholder................................. 4
3.9 Tax Election............................................. 4
4 CHANGES IN THE COMPANY'S CAPITAL STRUCTURE................... 4
5 REQUIREMENTS OF LAW.......................................... 6
6 AMENDMENT OR TERMINATION OF PLAN............................. 6
7 TAX WITHHOLDING.............................................. 6
8 TENURE....................................................... 7
9 WRITTEN AGREEMENT............................................ 7
10 INDEMNIFICATION OF COMMITTEE................................. 7
11 EFFECTIVE DATE OF PLAN....................................... 7
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Exhibit 4.2
THE COASTAL CORPORATION
1997 DIRECTORS STOCK PLAN
1. GENERAL
1.1 Purpose. This 1997 Directors Stock Plan (the "Plan") of The
Coastal Corporation (the "Company") for members of the board of
directors (the "Board") of the Company who are not employees of
the Company (i.e., nonemployee directors), is intended to advance
the best interests of the Company by providing incentives which
will attract, retain and reward nonemployee members of the Board
by offering them an opportunity to have a greater proprietary
interest which is more closely aligned with the Company and its
shareholders' interest.
1.2 Administration. The Plan shall be administered by a committee (the
"Committee") consisting of not less than three members who shall
be appointed from time to time by the Board. Members of the
Committee shall be officers and/ or employees of the Company or
any of its subsidiaries, none of whom shall be eligible to
participate in the Plan. The Board shall have the power to add or
remove members of the Committee from time to time, and to fill
vacancies thereon arising by resignation, death, removal, or
otherwise. The Committee shall designate a chairman from among its
members, who shall preside at all of its meetings, and shall
designate a secretary, without regard to whether that person is a
member of the Committee, who shall keep the minutes of the
proceedings and all records, documents, and data pertaining to its
administration of the Plan. Meetings shall be held at such times
and places as shall be determined by the Committee. A majority of
the members of the Committee shall constitute a quorum for the
transaction of business, and the vote of a majority of those
members present at any meeting shall decide any question brought
before that meeting. In addition, the Committee may take any
action otherwise proper under the Plan by the affirmative vote,
taken without a meeting, of a majority of its members. Any
decision or determination reduced to writing and signed by a
majority of the members shall be as effective as if it had been
made by a majority vote at a meeting properly called and held. No
member of the Committee shall be liable for any act or omission of
any other member of the Committee or for any act or omission on
his own part, including but not limited to the exercise of any
power or discretion given to him under the Plan, except those
resulting from his own gross negligence or willful misconduct. All
questions of interpretation and application of the Plan, including
those involving Options (as defined herein) shall be subject to
the determination of the Committee. The actions of the Committee
in exercising all of the rights, powers and authorities set out in
this Plan, when performed in good faith and in its sole judgment,
shall be final, conclusive, and binding on the parties.
1.3 Shares Available Under the Plan. All shares available under the
Plan for the grant of Options shall be shares of the Company's
Common Stock, $ .33 1/3 par value (the "Common Stock"). The total
number of shares of Common Stock available under the Plan shall
not exceed in the aggregate 250,000 shares; provided, that the
class and aggregate number of shares which may be subject to grant
hereunder shall be subject to adjustment in accordance with the
provisions of Section 4 hereof. Such shares may be treasury shares
or authorized but unissued shares.
In the event that any outstanding Option for any reason shall
expire or terminate by reason of the death or retirement or
termination from the Board of the Participant, the surrender of
any Option, or any other
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Exhibit 4.2
cause, the shares of Common Stock allocable to the unexercised
portion of that Option may again be available under the Plan.
1.4 Authority to Grant Options. Subject to the provisions of the Plan,
the Board shall grant to Participants (as defined herein) an
option which is the number of whole shares of Common Stock which
have an equivalent value of Twenty-Five Thousand Dollars ($25,000)
on the date of the grant ("Option"). Options shall be granted on
the date of adoption of the Plan and thereafter on the date of the
Company's annual shareholder meeting, except that a director who
is newly appointed to the Board after the date of the annual
shareholder meeting shall be entitled to the grant of an Option on
the effective date of his appointment to the Board and for former
employee directors who become Participants (as defined below),
Options shall be granted on the first day of the month following
the next release of the Company's quarterly or annual earnings, as
the case may be; provided, however, a Participant shall be granted
only one Option in a calendar year. The value of the Option on the
date of the grant shall be determined using the Black-Scholes
option pricing model (as defined herein) and the number of shares
to be granted in the Option shall be rounded up to the nearest
whole share.
1.5 General Provisions of Options. In addition to those specifically
provided for under the Plan, Options under the Plan may also be
subject to such other provisions as the Board determines
appropriate, including without limitation, (i) provisions to
comply with federal and state securities laws or (ii) any
understanding as to a Participant's service on the Board.
1.5.1 Whole Shares. Fulfillment of any vesting
requirements of an Option shall be in whole shares
only and any shares which remain unvested due to
vesting of whole shares shall vest at the end of the
required vesting period.
1.5.2 Fair Market Value. For all purposes of the Plan,
"Fair Market Value" of a share of Common Stock as of
any particular date shall mean the average of the
high and low sales price of a share of Common Stock
on that date as reported by the principal national
securities exchange on which the Common Stock is then
listed, if the Common Stock is then listed on a
national securities exchange, or the average of the
bid and asked price of a share of Common Stock on
that date as reported in the NASDAQ listing, if the
Common Stock is not then listed on a national
securities exchange, provided that if no closing
price or quotes are reported on that date or, if in
the discretion of the Committee, another means of
determining the fair market value of a share of
Common Stock at that date shall be necessary or
advisable, the Committee may provide for another
means of determining fair market value.
1.5.3 Black-Scholes Option Pricing Model. For purposes of
the Plan, the "Black-Scholes option pricing model" is
a mathematical formula, first published in 1973,
which was developed as a means of determining a value
for publicly-traded options with very short terms
(relative to most executive options). The primary
inputs in the Black-Scholes method are stock price
volatility, dividend yield, the option term and the
risk-free rate.
1.5.4 "Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time, or such successor or
replacement statute.
2. ELIGIBILITY TO PARTICIPATE. Eligible participants shall include all
members of the Board who are not employed by the Company or any of its
subsidiaries ("nonemployee directors"). Additionally, directors who are
former executives of the Company shall be eligible to participate as of
the first day of the month following the next release of quarterly or
annual earnings, as the case may be, after the termination of employment
with the
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Exhibit 4.2
Company or any of its subsidiaries ("former employee directors"). The
nonemployee directors and the former employee directors comprise the
"Participants" under the Plan.
3. OPTIONS. The Options granted hereunder would be nonqualified stock
options, subject to the general provisions of the Plan and the following
specific rules:
3.1 Option Term. The Options shall expire at the earliest of the end
of (i) the five-year period commencing with the date of the grant,
(ii) the three-year period commencing with the date of the
Participant's retirement from the Board or termination of Board
membership, or (iii) the one-year period commencing with the date
of death of the Participant.
3.2 Vesting. Each Participant shall be entitled to a nonforfeitable
right of a thirty-three and one/third percent (331/3%) of his
Option upon completion of each year of service on the Board,
commencing on the date that is one year from the date of the grant
of the Option (i.e., any Option shall be fully vested on the third
anniversary of the date of the grant of the Option). Vesting shall
cease upon a Participant's retirement from the Board or
termination of Board membership.
3.3 Option Price. The price at which shares may be purchased pursuant
to an Option shall be 100 percent of the Fair Market Value of the
shares of Common Stock on the date the Option is granted (the
"Option Price").
3.4 Exercise of Options. Upon completion of the vesting requirement, a
Participant may exercise an Option by delivering to the Company a
written notice stating (i) that the Participant wishes to exercise
the Option on the date notice is delivered, (ii) the number of
shares of Common Stock with respect to which the Option is to be
exercised, (iii) the address to which the certificate representing
the shares of Common Stock should be mailed, and (iv) the social
security number of the Participant.
In order to be effective, the written notice shall be accompanied
by (i) payment of the Option Price and (ii) payment of an amount
of money necessary to satisfy the withholding tax liability
imposed on the Company, if any, that may result from the exercise
of the Option.
3.5 Payment of Option Price.
3.5.1 Payment of Option Price. Payment for each exercise
shall be made (i) by cash or by check drawn on a
national banking association and payable to the order
of the Company in United States dollars, (ii) or to
the extent permitted by law, in Common Stock valued
at its Fair Market Value on the date of exercise, or
(iii) any other manner acceptable to the Committee.
Notwithstanding the provisions of this Section, the
Committee, in its sole discretion, may refuse to
accept shares of Common Stock in payment of the
Option Price of the shares of Common Stock with
respect to which the Option is to be exercised and,
in that event, any certificates representing shares
of Common Stock that were received by the Company
with written notice shall be returned to the
Participant, together with notice by the Company to
the Participant of the refusal of the Committee to
accept the shares of Common Stock. If, at the
expiration of seven business days after the delivery
to the Participant of written notice from the Company
that it will not accept shares of Common Stock in
payment of the Option Price, the Participant shall
not have delivered to the Company a check or money
order drawn on a national banking association and
payable to the order of the Company in an amount, in
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Exhibit 4.2
United States dollars, equal to the Option Price of
the shares of Common Stock with respect to which such
Option is to be exercised, plus any applicable
withholding tax liability, the written notice from
the Participant to the Company shall be ineffective
to exercise the Option.
3.5.2 Payment in Common Stock. Any payment made in Common
Stock, shall be accomplished by delivering to the
Company (i) certificates registered in the name of
the Participant that represent a number of shares of
Common Stock legally and beneficially owned by the
Participant (free of all liens, claims and
encumbrances of every kind) and having a Fair Market
Value, on the date of receipt by the Company of
written notice, that is not greater than the Option
Price of the shares of Common Stock with respect to
which the Option is to be exercised, the certificates
to be accompanied by stock powers duly endorsed in
blank by the record holder of the shares of Common
Stock represented by certificates (or in lieu of such
certificates, other arrangements for the transfer of
shares to the Company which are satisfactory to the
Company), and cash or a check drawn on a national
banking association and payable to the order of the
Company in an amount, in United States dollars, equal
to the amount of the difference between the Option
Price and the Fair Market Value, plus (ii) the amount
of money, in a form acceptable to the Committee,
necessary to satisfy the withholding tax liability
imposed on the Company, if any, that may result from
the exercise of the Option, unless the Participant
elects to satisfy such withholding tax liability
pursuant to Section 3.5.3.
3.5.3 Withholding Tax. In lieu of requiring the Participant
to make a payment to the Company in an amount related
to the withholding tax requirement, the Committee
may, in its discretion, provide that, at the
Participant's election, the tax withholding
obligation imposed on the Company shall be satisfied
by the Participant's delivering to the Company shares
of Common Stock, the value of which is equal to the
tax withholding obligation, with such shares valued
at their Fair Market Value as of the date of delivery
of such shares by the Participant to the Company.
3.6 Common Stock Certificates. As promptly as practicable after the
receipt by the Company of (i) the written notice from the
Participant of the exercise of the Option, (ii) payment of the
Option Price of the shares of Common Stock with respect to which
the Option is to be exercised, and (iii) payment of any
withholding tax liability imposed on the Company that may result
from the exercise of the Option, the Company shall deliver to the
Participant a certificate representing the number of shares of
Common Stock with respect to which the Option has been exercised.
The certificate shall be registered in the name of the Participant
and delivery shall be considered to have been made when the
certificate shall have been mailed, postage prepaid, to the
Participant at the address specified for that purpose in written
notice from the Participant to the Company.
3.7 Nontransferability of Options. Options shall not be transferable
by the Participant other than by will or under the laws of descent
and distribution, except for gifts to members of the Participant's
family, and shall be exercisable, during the Participant's
lifetime, only by the Participant or the family member to whom the
Option has been transferred.
3.8 No Rights as Shareholder. No Participant shall have rights as a
shareholder with respect to shares covered by an Option until the
date of issuance of a stock certificate for the shares; and,
except as otherwise provided in Section 4, no adjustment for
dividends, or otherwise, shall be made if the record date therefor
is prior to the date of issuance of the certificate.
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Exhibit 4.2
3.9 Tax Election. Any Participant shall provide prior written notice
to the Company if the Participant makes an election pursuant to
Section 83(b) of the Code.
4. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE. The existence of outstanding
Options shall not affect in any way the right or power of the Company or
its shareholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's
capital structure or its business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior preference
stock ahead of or affecting the Common Stock or the rights thereof, or
the dissolution or liquidation of the Company, or any sale or transfer of
all or any part of its assets or business, or any other corporate act or
proceeding, whether of a similar character or otherwise.
If the Company shall effect a subdivision or consolidation of shares or
other capital readjustment, the payment of a dividend in capital stock or
other equity securities of the Company on its Common Stock or other
increase or reduction of the number of shares of the Common Stock
outstanding, without receiving consideration therefor in money, services,
or property, or the reclassification of its Common Stock, in whole or in
part, into other equity securities of the Company, then (a) the number,
class and per share price of shares of Common Stock subject to
outstanding Options hereunder shall be appropriately adjusted (or in the
case of the issuance of other equity securities as a dividend on, or in a
reclassification of, the Common Stock, the Options shall extend to such
other securities) in a manner so as to entitle a Participant to receive,
upon exercise of an Option, for the same aggregate cash consideration,
the same total number and class or classes of shares (or in the case of a
dividend of, or reclassification into, other equity securities, those
other securities) he would have held after adjustment if he had exercised
his Option immediately prior to the event requiring the adjustment, or,
if applicable, the record date for determining shareholders to be
affected by the adjustment; and (b) the number and class of shares then
reserved for issuance under the Plan (or in the case of a dividend of, or
reclassification into, other equity securities, those other securities)
shall be adjusted by substituting for the total number and class of
shares of stock then reserved, the number and class or classes of shares
of stock (or in the case of a dividend of, or reclassification into,
other equity securities, those other securities) that would have been
received by the owner of an equal number of outstanding shares of Common
Stock as a result of the event requiring the adjustment. Comparable
rights shall accrue to each Participant in the event of successive
subdivisions, consolidations, capital adjustments, dividends or
reclassifications of the character described above.
After a merger of one or more corporations into the Company, after any
consolidation of the Company and any one or more corporations, or after
any other corporate transaction described in Section 424(a) of the Code
in which the Company shall be the surviving corporation, each
Participant, at no additional cost, shall be entitled to receive (subject
to any required action by shareholders), upon any exercise of his Option,
in lieu of the number of shares as to which the Option shall then be
exercisable, the number and class of shares of stock or other securities
to which the holder would have been entitled pursuant to the terms of the
agreement of merger or consolidation, if, immediately prior to such
merger or consolidation, such holder had been the holder of a number of
shares of Common Stock equal to the number of shares as to which the
Option shall then be exercised and, if as a result of the merger,
consolidation or other transaction, the holders of Common Stock are not
entitled to receive any shares of Common Stock pursuant to the terms
thereof, each Participant, at no additional cost, shall be entitled to
receive, upon exercise of his Option, other assets and property,
including cash, to which he would have been entitled if at the time of
such merger, consolidation or other transaction he had been the holder of
the number of shares of Common Stock equal to the number of shares as to
which the Option shall then be exercised. Comparable rights shall accrue
to each Participant in the event of successive mergers or consolidations
of the character described above.
If the Company is merged into or consolidated with another corporation
under circumstances where the Company is not the surviving corporation,
or if the Company is liquidated, or sells or otherwise disposes of
substantially all its assets to another corporation while unexercised
Options remain outstanding under the Plan, (i) subject to
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Exhibit 4.2
the provisions of clause (iii) below, after the effective date of such
merger, consolidation or sale, as the case may be, each holder of an
outstanding Option shall be entitled, upon exercise of such Option, to
receive in lieu of shares of Common Stock, shares of such stock or other
securities as the holders of shares of Common Stock received pursuant to
the terms of the merger, consolidation or sale; (ii) the Board may waive
any limitations set forth in or imposed pursuant to Section 3 hereof so
that all Options from and after a date prior to the effective date of
such merger, consolidation, liquidation or sale, as the case may be,
specified by the Board shall be exercisable in full; and (iii) all
outstanding Options may be canceled by the Board as of the effective date
of any such merger, consolidation, liquidation or sale, provided that (a)
notice of such cancellation shall be given to each holder of an Option
and (b) each holder of an Option shall have the right to exercise such
Option in full (without regard to any limitations set forth in or imposed
pursuant to Section 3 hereof) during a 30-day period preceding the
effective date of such merger, consolidation, liquidation, sale or
acquisition.
Except as hereinbefore expressly provided, the issue by the Company of
shares of stock of any class, or securities convertible into shares of
stock of any class, for cash or property, or for labor or services either
upon direct sale or upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number
or price of shares of Common Stock then subject to outstanding Options.
5. REQUIREMENTS OF LAW. The Company shall not be required to sell or issue
any shares under any Option if the issuance of those shares would
constitute a violation by the Participant or the Company of any
provisions of any law or regulation of any governmental authority. Each
Option granted under the Plan shall be subject to the requirements that,
if at any time the Board or the Committee shall determine that the
listing, registration or qualification of the shares subject thereto upon
any securities exchange or under any state or federal law of the United
States or of any other country or governmental subdivision thereof, or
the consent or approval of any governmental regulatory body, or
investment or other representations, are necessary or desirable in
connection with the issue or purchase of shares subject thereto, no
Option may be exercised in whole or in part, unless the listing,
registration, qualification, consent, approval or representations shall
have been effected or obtained free of any conditions not acceptable to
the Board. If required at any time by the Board or the Committee, an
Option may not be exercised until the Participant has delivered an
investment letter to the Company. In addition, specifically in connection
with the Securities Act of 1933, as currently in effect or as hereafter
amended, (the "1933 Act"), upon exercise of any Option, the Company shall
not be required to issue the underlying shares unless the Committee has
received evidence satisfactory to it to the effect that the holder of the
Option will not transfer the shares except pursuant to a registration
statement in effect under the 1933 Act or unless an opinion of counsel
satisfactory to the Committee has been received by the Company to the
effect that registration is not required. Any determination in this
connection by the Committee shall be final, binding and conclusive. In
the event the shares issuable on exercise of an Option are not registered
under the 1933 Act, the Company may imprint on the certificate for the
shares the following legend or any other legend which counsel for the
Company considers necessary or advisable to comply with the 1933 Act:
"The shares of stock represented by this certificate have not
been registered under the Securities Act of 1933 or under the
securities laws of any state and may not be sold or
transferred except upon such registration or upon receipt by
the Corporation of an opinion of counsel satisfactory to the
Corporation, in form and substance satisfactory to the
Corporation, that registration is not required for such sale
or transfer."
The Company may, but shall not be obligated to, register any securities
covered hereby pursuant to the 1933 Act and in the event any shares are
registered, the Company may remove any legend on certificates
representing such registered shares. The Company shall not be obligated
to take any other affirmative action in order to cause the
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Exhibit 4.2
exercise of an Option or the issuance of shares pursuant thereto to
comply with any law or regulation of any governmental authority.
6. AMENDMENT OR TERMINATION OF PLAN. The Board may modify, revise or
terminate the Plan at any time and from time to time; provided, however,
that without the further approval by the affirmative vote of a majority
of the votes cast attributable to shares present in person or by proxy
and entitled to vote at a meeting of shareholders, or if the provisions
of the corporate charter, by-laws or applicable state law prescribes a
greater degree of shareholder approval for this action, without the
degree of shareholder approval thus required, the Board may not (i)
change the aggregate number of shares which may be issued under Options
pursuant to the provisions of the Plan, (ii) extend the term during which
an Option may be exercised or granted or the termination date of the
Plan, (iii) change the eligibility to receive Options under the Plan, or
(iv) reduce the Option Price, unless, in each such case, the Board shall
obtain an opinion of legal counsel to the effect that shareholder
approval of the amendment is not required (a) by law, (b) by the
applicable rules and regulations of, or any agreement with, any national
securities exchange on which the Common Stock is then listed or if the
Common Stock is not so listed, the rules and regulations, or any
agreement with, the National Association of Securities Dealers, Inc., and
(c) in order to make available to the Participant with respect to any
Option granted under the Plan, the benefits of Rule 16b-3 of the Rules
and Regulations under the Exchange Act, or any similar or successor rule.
7. TAX WITHHOLDING. To the extent not otherwise provided for herein, the
Company shall be entitled to deduct from compensation payable to each
Participant any sums required by federal, state, or local tax law to be
withheld with respect to the grant, exercise, or vesting, as appropriate,
of an Option. In the alternative, the Company may require the Participant
(or other person exercising the Option) to pay the sum directly to the
Company. The Company shall have no obligation upon exercise of any Option
until payment has been received. The Company shall not be obligated to
advise a Participant of the existence of the tax or the amount which the
Company will be required to withhold.
8. TENURE. A Participant's right, if any to continue to serve on the Board
shall not be enlarged or otherwise affected by his designation as a
Participant under the Plan.
9. WRITTEN AGREEMENT. Each Option granted hereunder shall be embodied in a
written agreement, which shall be subject to the terms and conditions
prescribed herein, and shall be signed by the Participant and by an
appropriate officer of the Company for and in the name and on behalf of
the Company.
10. INDEMNIFICATION OF COMMITTEE. The Company shall, to the fullest extent
provided by law, indemnify each present and future member of the
Committee against, and each member of the Committee shall be entitled
without further act on his part to indemnity from the Company for all
expenses (including the amount of judgments and the amount of approved
settlements made with a view to the curtailment of costs of litigation,
other than amounts paid to the Company itself) reasonably incurred by him
in connection with or arising out of any action, suit or proceeding in
which he may be involved by reason of his being or having been a member
of the Committee, whether or not he continues to be a member of the
Committee at the time of incurring such expenses; provided, however, that
such indemnity shall not include any expenses incurred by any such member
of the Committee (i) in respect of matters as to which he shall be
finally adjudged in any such action, suit or proceeding to have been
guilty of gross negligence or willful misconduct in the performance of
his duty as such member of the Committee, or (ii) in respect of any
matter in which any settlement is effected, to an amount in excess of the
amount approved by the Company on the advice of its legal counsel; and
provided further, that no right of indemnification under the provisions
set forth herein shall be available to, or enforceable by, any such
member of the Committee unless, within sixty (60) days after institution
of any such action, suit or proceeding, he shall have offered the
Company, in writing, the opportunity to handle and defend same at its
own expense. The foregoing right of indemnification shall inure to the
benefit of the heirs, executors or administrators of each
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Exhibit 4.2
member of the Committee and shall be in addition to all other rights to
which the member of the Committee may be entitled as a matter of law,
contract, or otherwise.
11. EFFECTIVE DATE OF PLAN. The Plan shall become effective and shall be
deemed to have been adopted on June 5 , 1997. No Option shall be granted
pursuant to the Plan after June 4, 2007.
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