Exhibit 10.1.9
PACIFIC CAPITAL BANCORP
AMENDED AND RESTATED 1996 DIRECTORS STOCK PLAN
(Effective February 22, 2000)
1. PURPOSES OF THE PLAN
The purposes of this 1996 Directors Stock Plan are to attract, motivate
and retain the best available Directors for the Company and each of its
Subsidiaries and to provide them with additional incentive to promote the
success of the Company's business.
2. DEFINITIONS
As used herein, the following definitions shall apply:
2.1 Administrator. "Administrator" means the Board of Directors or any
of its Committees as shall be administering the Plan in accordance with Section
8 of the Plan.
2.2 Applicable Laws. "Applicable Laws" means the federal and state laws
relating to the administration of stock option plans.
2.3 Award. "Award" means any Option or Restricted Stock granted or
issued under this Plan.
2.4 Award Agreement. "Award Agreement" means any Option Agreement or
Restricted Stock Agreement, as appropriate, relating to any Award.
2.5 "Board of Directors" means the Board of Directors of the Company.
2.6 "Change of Control" means the occurrence of either of the following
events:
2.6.1 An acquisition (other than directly from the Company) of
any voting securities of the Company by any person (as that term is used for
purposes of Section 13(d) or Section 14(d) of the Exchange Act), immediately
after which such person has beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of thirty-five percent (35%) or more
of the combined voting power of the Company's then outstanding voting
securities;
A. provided that a Change of Control shall not be
deemed to have occurred if the person acquiring the securities is
either (a) an employee benefit plan (or a trust forming a part thereof)
maintained by the Company or any of its Subsidiaries or (b) the Company
or any of its Subsidiaries; and
B. provided further that a Change of Control shall
not be deemed to have occurred if any other person acquires such
securities in connection with any merger, consolidation or other
reorganization of the Company in a transaction after which:
1
<PAGE>
(1) the shareholders of the Company, immediately
before such transaction, own directly or indirectly immediately after
such transaction at least fifty-one percent (51%) of the voting
securities of the surviving corporation in substantially the same
proportion as their ownership of the voting securities of the Company
immediately before such transaction; or
(2) the individuals who were Incumbent Directors at
the time of the Company's execution of the agreement providing for such
transaction constitute at least a majority of the members of the board
of directors of the corporation resulting from such merger,
consolidation or reorganization (the "Surviving Corporation"); provided
that, if the Company is not the Surviving Corporation, the individuals
who were Incumbent Directors at the time of the Company's execution of
the agreement providing for such transaction constitute at least a
majority of the members of the board of directors of the ultimate
parent corporation of the Surviving Corporation; or
(3) no person [other than (a) the Company, (b) any
Subsidiary of the Company, or (c) any employee benefit plan (or any
trust forming a part thereof) maintained by the Company, the Surviving
Corporation or any Subsidiary of the Company], has beneficial ownership
of thirty-five percent (35%) or more of the combined voting power of
the Surviving Corporation's voting securities outstanding immediately
after such transaction; or
2.6.2 A cumulative change in the composition of the Board of
Directors occurring during any two-year period, as a result of which fewer than
a majority of the Directors are Incumbent Directors; provided that no individual
shall be considered to be an Incumbent Director if such individual initially
assumed office as a result of either an actual or threatened election contest
(as described in Rule 14a-11 promulgated under the Exchange Act) (an "Election
Contest") or other actual or threatened solicitation of proxies or consents by
or on behalf of a person other than the Board of Directors (a "Proxy Contest"),
including by reason of any agreement intended to avoid or settle any Election
Contest or Proxy Contest.
2.6.3 Notwithstanding the foregoing, a Change of Control shall
not be deemed to occur solely because any person acquires beneficial ownership
of more than the permitted amount of the then outstanding voting securities of
the Company as a result of the acquisition of voting securities by the Company
which, by reducing the number of voting securities then outstanding, increases
the proportional number of voting securities beneficially owned by such person;
provided that if a Change of Control would occur (but for the operation of this
sentence) as a result of the acquisition of voting securities by the Company,
and, after such acquisition by the Company, such person becomes the beneficial
owner of any additional voting securities which increases the percentage of the
then outstanding voting securities beneficially owned by such person, then a
Change of Control shall occur.
2.6.4 Notwithstanding anything in this Plan or any Stock
Option Agreement or Restricted Stock Agreement to the contrary, (a) the
occurrence of a merger, consolidation or reorganization that is described in
Section 11.2 of this Plan shall not be considered the occurrence of a change of
control for any purposes under this Plan or any Stock Option Agreement or
Restricted Stock Agreement and (b) if a merger, consolidation, reorganization or
other transaction might be deemed to be described in both this Section and
Section 11.2 of this Plan, such merger, consolidation, reorganization or other
transaction shall be deemed to be described in only Section 11.2 of this Plan.
2
<PAGE>
2.7 "Code" means the Internal Revenue Code of 1986, as amended.
2.8 "Commission" means the Securities and Exchange Commission.
2.9 "Committee" means the Committee of the Board of Directors that
shall administer the Plan.
2.10 "Common Stock" means the Common Stock of the Company.
2.11 "Company" means Pacific Capital Bancorp, a California corporation.
2.12 "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.
2.13 "Donative Transfer" means any transfer of an Option or Reload
Option made for donative purposes or without the payment or receipt by or on
behalf of the Optionee of any cash, property or other consideration. For
purposes of this Section 2.13, neither an Optionee's receipt of or eligibility
for a deduction, credit or similar allowance for federal or state income tax or
estate tax purposes nor the transferee's use for family or support purposes of
any proceeds realized from the sale of any shares of Common Stock acquired on
exercise of an Option shall be deemed to be the receipt of consideration.
2.14 Effective Date. "Effective Date" means February 22, 2000, the date
on which the amendment of this Plan was approved by the Board of Directors.
2.15 "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
2.16 "Fair Market Value" means, as of any date, the value of the Common
Stock determined as follows.
2.16.1 If the Common Stock is listed on an established stock
exchange or a national market system, including without limitation the Nasdaq
National Market of the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") System, the Fair Market Value of a share of
Common Stock shall be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such system or exchange (or the
exchange with the greatest volume of trading in the Common Stock) on the last
market trading day prior to the date of determination.
2.16.2 If the Common Stock is quoted on the NASDAQ System (but
not on the Nasdaq National Market thereof) or is regularly quoted by a
recognized securities dealer but selling prices are not reported, the Fair
Market Value of a share of Common Stock shall be the mean between the high bid
and low asked prices for the Common Stock on the last market trading day prior
to the date of determination.
2.17 Incumbent Directors. "Incumbent Directors" means Directors of the
Company who either (a) are Directors of the Company as of the Effective Date, or
(b) are elected, or nominated for election, to the Board of Directors by the
affirmative vote of at least a majority of the Incumbent Directors at the time
of such election or nomination; provided that, for purposes of clause (b) of
this Section 2.17, an individual whose election or nomination is effected in
connection with an actual or threatened Election Contest or Proxy Contest
relating to the election of Directors to the Company shall not be considered an
Incumbent Director.
2.18 Nonqualified Stock Option. "Nonqualified Stock Option" means an
Option which is not designated as an Incentive Stock Option by the
Administrator.
3
<PAGE>
2.19 "Option" means a stock option granted pursuant to the Plan and
shall include Reload Options. All Options granted hereunder shall be
"nonstatutory stock options" and each such Option shall be evidenced by a
written Stock Option Agreement.
2.20 "Optioned Stock" means the Common Stock subject to an Option.
2.21 "Optionee" means a Director who receives an Option.
2.22 "Participant" means any Director who has received an Award under
this Plan.
2.23 "Plan" means this Restricted Stock Option Plan, as amended and
restated.
2.24 Restricted Stock. "Restricted Stock" means Common Stock awarded
under this Plan.
2.25 Restricted Stockholder. "Restricted Stockholder" means a Director
granted an award of Restricted Stock under this Plan.
2.26 Restricted Stock Agreement. "Restricted Stock Agreement" means a
written agreement between the Company and the Restricted Stockholder evidencing
the terms and restrictions applying to the award of the Restricted Stock. Each
Restricted Stock Agreement is subject to the terms and conditions of the Plan.
The terms and provisions of each Restricted Stock Agreement need not be the
same.
2.27 "Plan" means this 1996 Directors Stock Option Plan.
2.28 "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act
or any successor to Rule 16b-3 in effect at the time in question.
2.29 "Section 16(b)" means Section 16(b) of the Exchange Act.
2.30 "Stock Option Agreement" means a written agreement between the
Company and an Optionee evidencing the terms and conditions of an individual
Option grant. Each Option Agreement is subject to the terms and conditions of
the Plan. The terms and provisions of each Option Agreement need not be the
same.
2.31 "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined as Section 424(f) of the Code.
3. STOCK SUBJECT TO THE PLAN
3.1 Original Reserve. Subject to the provisions of Sections 11.1 and
11.2 of the Plan, the maximum aggregate number of shares which are reserved for
issuance upon exercise of Options and other Awards granted under the Plan is
Five Hundred Fifty Thousand (550,000) shares of Common Stock. During the term of
this Plan, the Company will at all times reserve and keep available such number
of shares as shall be sufficient to satisfy the requirements of the Plan (the
Plan "Reserve").
3.2 Adjustments In Reserve. In the event that any outstanding Option
granted under the Plan expires or is terminated without exercise, or with only
partial exercise, prior to the end of the period during
4
<PAGE>
which Options may be granted under the Plan, the shares allocable to the
unexercised portion of such Option shall be added back into the Reserve. In the
event that any outstanding shares of Restricted Stock awarded under the Plan are
repurchased by the Company prior to the end of the period during which
Restricted Stock may be awarded under the Plan, such shares of Restricted Stock
shall be added back into the Reserve.
4. ELIGIBILITY
Awards may be granted only to Directors of the Company, or any
Subsidiary, who are not otherwise employed by the Company or any Subsidiary. In
addition, notwithstanding any other provision contained in this Plan, no
Director shall be eligible to receive any Award under the Plan if such
individual owns stock and securities possessing more than ten percent (10%) of
the total combined voting power or value of all classes of stock of the Company
or any Subsidiary. Notwithstanding anything in this Plan to the contrary, no
person shall be entitled to the grant of more than one Award during or with
respect to any year by reason of such person acting as a Director of more than
one of the Company or a Subsidiary. No person shall be eligible to receive the
grant of an Award under this Plan unless he or she is a Director of the Company
or such Subsidiary on the date of such grant.
5. TYPES OF AWARDS
5.1 Grant of Options.
5.1.1 Effective Date of Option Grant. The "grant" of an Option
pursuant to this Plan shall be deemed to have occurred on the latest of: (a) the
date the Board of Directors or the Committee announces the grant of the Option;
or (b) such later date designated by the Board of Directors or the Committee or
set forth in the Stock Option Agreement.
5.1.2 Determination of Grants.
A. The Administrator may from time to time, in its
absolute discretion:
(1) Determine which Directors are to be
granted Options;
(2) Determine the number of shares subject
to Options granted to any Director; and
(3) Determine the other terms and conditions
of such Options consistent with this Plan.
B. Upon the selection of a Director to be granted an
Option, the Administrator shall instruct the Secretary of the Company
to issue the Option and may impose such conditions on the grant of the
Option as the Administrator deems appropriate.
5.1.3 Other Awards. Options may be granted either alone, in
addition to, or in tandem with other Awards granted under the Plan and/or cash
awards made outside of the Plan.
5.1.4 Stock Option Agreements. Each Option granted hereunder
shall be evidenced by a written Stock Option Agreement.
5
<PAGE>
5.2 Award of Restricted Stock.
5.2.1 Effective Date of Award. The award of Restricted Stock
pursuant to this Plan shall be deemed to have occurred on the latest of: (a) the
date the Board of Directors or the Committee announces the award of the
Restricted Stock; or (b) such later date designated by the Board of Directors or
the Committee or set forth in the Restricted Stock Agreement.
5.2.2 Determination of Awards.
A. The Administrator may from time to time, in its
absolute discretion:
(1) Determine which Directors are to be
awarded Restricted Stock;
(2) Determine the purchase price, if any,
and the form of payment of the purchase price for the
Restricted Stock; provided that such purchase price shall be
no less than par value;
(3) Determine the period, if any, over which
the Restricted Stockholder's interest in the Restricted Stock
shall vest; provided that such period shall not be longer than
five (5) years and at least twenty percent (20%) of the
interest shall vest on each anniversary of the date of
issuance of the Restricted Stock; provided further that the
Administrator may provide in any Restricted Stock Agreement
that the Restricted Stock shall be fully vested on the
occurrence of a Change in Control; and
(4) Determine the other terms and
conditions, consistent with this Plan, applicable to the award
of the Restricted Stock.
B. Upon the grant of Restricted Stock award, the
Administrator shall instruct the Secretary of the Company to issue such
Restricted Stock and may impose such conditions on the issuance of such
Restricted Stock as it deems appropriate.
5.2.3 Other Awards. Restricted Stock may be issued either
alone, in addition to, or in tandem with other Awards granted under the Plan
and/or cash awards made outside of the Plan.
5.2.4 Restricted Stock Agreements. Each award of Restricted
Stock shall be evidenced by a written Restricted Stock Agreement.
5.3 Performance Awards. The Administrator may designate whether any
grant of any Option or Restricted Stock is intended to be "performance-based
compensation" as that term is used in Section 162(m) of the Code. Any grant of
an Option or award of Restricted Stock designated as intended to be
"performance-based compensation" shall be conditioned on the achievement of one
or more performance measures established by the Administrator. For grants of
Options and awards of Restricted Stock intended to be "performance-based
compensation," the grant of the Option or Restricted Stock and the establishment
of the performance measures shall be made during the period required under
Section 162(m) of the Code.
6. TERMS OF OPTIONS
6.1 Term of Option. Subject to the provisions of Section 6.3, below,
the term of each Option shall be five (5) years from the date of grant thereof.
6
<PAGE>
6.2 Exercise Price and Consideration.
6.2.1 Exercise Price. The exercise price per share for the
shares to be issued upon exercise of an Option shall be 100% of the Fair Market
Value per share of Common Stock on the date of grant of the Option.
6.2.2 Consideration. The consideration to be paid for the
shares to be issued upon exercise of an Option shall consist entirely of cash,
cashier's or bank certified check, or other shares of Common Stock having a Fair
Market Value on the date of exercise of the Option equal to the exercise price
for the shares as to which the Option is being exercised, or any combination of
such methods of payment. In the event that the exercise price is paid, whether
in whole or in part, through the tender of shares of Common Stock already owned
by the Optionee, then the Option must be exercised for a minimum of at least 100
shares or the total number of shares subject to the Option, if less than 100
shares.
6.3 Exercise of Option.
6.3.1 Six-Month Vesting Period. Any Option shall become
exercisable only after the expiration of six (6) months following the date of
grant of such Option. Thereafter, the Option shall be fully vested and shall be
exercisable in whole or in part at any time and from time to time during the
term of the Option.
6.3.2 Acceleration on Change of Control. Upon the occurrence
of a Change of Control, all unexercised Options then outstanding shall be and
become immediately exercisable effective as the effective date of such Change of
Control. The Company shall use its reasonable efforts to promptly notify each
Optionee upon the occurrence of a Change of Control; provided that neither the
Company nor any member of the Board of Directors or the Committee shall have any
liability to any Optionee solely by reason of any delay or failure to give
notice of the occurrence of a Change of Control.
6.3.3 Procedure for Exercise. An Option shall be deemed to be
exercised when the Optionee has delivered to the Administrator written notice of
such exercise and full payment of the exercise price for the shares with respect
to which the Option is being exercised. Full payment shall consist of such
consideration as is allowable under Section 6.2, above. An Option may not be
granted or exercised for a fraction of a share. Exercise of an Option in any
manner shall result in a decrease in the number of shares which thereafter may
be available, both for the purposes of the Plan and for issuance under the
Option, by the number of shares as to which the Option is exercised. Optionee
may designate in the notice of exercise that some or all of the shares of Common
Stock or other securities to be issued upon such exercise shall be issued in the
name of Optionee's spouse, the trustee of a revocable trust in which Optionee
and his or her spouse are the sole primary beneficiaries, Optionee's prior
spouse, or any combination of the foregoing. Notwithstanding anything herein to
the contrary, Optionee may not designate in the notice of exercise that any of
the shares of Common Stock or other securities shall be issued to Optionee's
prior spouse unless such issuance is to be made pursuant to a domestic relations
order as defined in the Code or Title I of the Employee Income Retirement
Security Act, or the rules thereunder. The Company may rely on a representation
of the Optionee, or such other evidence as the Company deems appropriate, for
purposes of determining the propriety of the exercise of any Option and the
compliance of such exercise with the terms of this Plan and any applicable Stock
Option Agreement. The Company shall have no obligation to independently
investigate the propriety of the exercise of any Option or the compliance of
such exercise with the terms of this Plan or any applicable Stock Option
Agreement.
7
<PAGE>
6.3.4 Rights as a Shareholder. Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
the shares of Common Stock, the Optionee shall have no right to vote or receive
dividends or any other rights as a shareholder with respect to the Optioned
Stock, notwithstanding the exercise of the Option. No adjustment shall be made
in the exercise price payable on the exercise of any Option or the number of
shares of Common Stock or other securities or property issuable upon exercise of
an Option for any dividend, distribution or other right for which the record
date is prior to the date the stock certificate is issued to Optionee with
respect to any Optioned Stock, except as provided in Section 11.1 and Section
11.2, below.
6.3.5 Termination of Option.
A. Termination of Status as Director. If an
Optionee's continuous status as a Director is terminated other than for
cause or by reason of the Optionee's death or disability, the Optionee
may, but only within the three (3)-month period from the date of the
termination of the Optionee's status as a Director (but not later than
the expiration of the term of the Option), exercise any outstanding
Option (including any Reload Option) to the extent that the Option was
exercisable at the date of such termination. If the Optionee does not
exercise the Option in full during such 3-month period, the unexercised
portion of the Option shall terminate at the close of business,
California time, on the last business day of such 3-month period and
thereafter shall not be exercisable in whole or in part.
Notwithstanding anything in this Section to the contrary, if the Option
is not exercisable on the date of the termination of the Optionee's
status as a Director, then the Option shall terminate simultaneously
with the termination of the Optionee's status as a Director and
thereafter shall not be exercisable in whole or in part.
B. Disability of Optionee. Notwithstanding the
provisions of Section 6.3.5.A, above, if an Optionee's continuous
status as a Director is terminated other than for cause and as a result
of the Optionee's death or disability, the Optionee or his or her
estate or personal representative may exercise the Option to the extent
that the Option was exercisable at the date of such termination in
whole or in part at any time and from time to time during the twelve
(12)-month period from the date of the termination of the Optionee's
status as a Director. If the Optionee does not exercise the Option in
full during such 12-month period, the unexercised portion of the Option
shall terminate at the close of business, California time, on the last
business day of such 12-month period and thereafter shall not be
exercisable in whole or in part. Notwithstanding anything in this
Section to the contrary, if the Option is not exercisable on the date
of the termination of the Optionee's status as a Director, then the
Option shall terminate simultaneously with the termination of the
Optionee's status as a Director and thereafter shall not be exercisable
in whole or in part.
C. Termination for Cause. If an Optionee's continuous
status as a Director is terminated for cause, all outstanding Options
held by the Optionee shall terminate simultaneously with the
termination of the Optionee's status as a Director and thereafter shall
not be exercisable in whole or in part. For purposes of this Section,
an Optionee's status as a Director shall be deemed to be terminated for
"cause" as of the date on which the Optionee is removed as a Director
for any reason described in Section 304 of the California General
Corporation Law.
D. Status as a Director. The termination of an
Optionee's status as a Director shall be deemed to occur on the
effective date of the earliest of (a) the Optionee's resignation as a
Director, (b) the removal of the Optionee as a Director, or (c) the
Optionee's death.
8
<PAGE>
6.4 Reload Features.
6.4.1 Grant of Reload Options. Whenever the holder of an
Option granted under this Plan (including any Reload Options granted under the
provisions of this Section 6.4 or Section 9, below) (the "Original Option")
exercises the Original Option and pays the exercise price by tendering shares of
the Common Stock held by the Optionee, then the Company shall grant the Optionee
a new option (the "Reload Option") for that number of shares of the Common Stock
which is equal to the number of shares tendered by the Optionee in payment of
the exercise price for the Original Option. All Reload Options granted hereunder
shall be on the following terms and conditions.
A. Exercise Price. The exercise price per share shall
be an amount equal to the Fair Market Value per share of the Common
Stock as of the date of exercise of the Original Option.
B. Expiration Date. The term of the Reload Option
shall begin as of the date of exercise of the Original Option and,
unless terminated sooner pursuant to the terms of this Plan or the
Stock Option Agreement, shall terminate five (5) years thereafter.
C. Vesting Period. Any Reload Option shall become
exercisable one (1) year following the date of grant of such Reload
Option. Thereafter the Reload Option shall be fully vested and shall be
exercisable in whole or in part at any time and from time to time
during the term of the Reload Option.
D. Other Terms. All other terms of Reload Options
granted hereunder shall be identical to the terms and conditions of the
Original Option, the exercise of which gives rise to the grant of the
Reload Option.
6.4.2 Restrictions on Reload Options. Any and all Reload
Options granted pursuant to this Section 6.4 (or Section 9, below) shall be
subject to the following conditions and restrictions.
A. Holding Period of Shares Tendered. No Reload
Option shall be granted pursuant to Section 6.4.1, above, unless the
shares of Common Stock tendered upon exercise of the Original Option in
payment therefore have been held by the Optionee for a period of more
than six (6) months prior to the exercise of the Original Option. The
Company may rely on a representation of the Optionee, or such other
evidence as the Company deems appropriate, for purposes of determining
the holding period of any shares surrendered on exercise of an Option
and the compliance of such exercise with the terms of this Plan and any
applicable Stock Option Agreement. The Company shall have no obligation
to independently investigate the holding period or the propriety of the
exercise of any Option or the compliance of such exercise with the
terms of this Plan or any applicable Stock Option Agreement.
B. Holding Period of Original Option Shares. If any
of the shares of Common Stock of the Company which are issued upon
exercise of the Original Option are sold within one (1) year following
the exercise of the Original Option, then the Reload Option shall
immediately terminate.
9
<PAGE>
C. Exception. The holding period restrictions set
forth in Sections 6.4.2.A and 6.4.2.B, above, shall not apply to an
Optionee's transfer of shares of Common Stock (i) to the Company in
payment of all or any portion of the exercise price upon exercise of an
Option, whether an Original Option or a Reload Option, or (ii) in
satisfaction of the Optionee's income tax withholding obligation, if
any, by the transfer of shares to the Company or by the Company's
withholding of shares that would otherwise be issued as a result of the
exercise of an Option, or (iii) to the acquiring party in any
transaction described in Section 11.2, below, in which the Company is
not the surviving corporation, or (iv) to any person described in
Section 6.5.2.A hereof so long as the transfer satisfies the conditions
of Section 6.5.2 hereof.
6.5 Transferability of Options.
6.5.1 Restriction on Transfer. Except as specifically set
forth in Section 6.5.2 hereof, no Option or Reload Option may be sold, pledged,
assigned, hypothecated, transferred, or otherwise disposed of in any manner,
other than by will or the laws of descent and distribution.
6.5.2 Limited Transferability. A Stock Option Agreement may
provide that an Optionee may transfer all or any portion of any Option or Reload
Option in accordance with the provisions of this Section 6.5.2. If a Stock
Option Agreement permits the transfer of any Option or Reload Option, any
transfer that does not comply with all of the provisions of this Section 6.5.2
and the Stock Option Agreement shall be null and void ab initio. The provisions
of the Stock Option Agreements dealing with the transferability of the Options
need not be identical for all Options and the provision for transferability with
respect to one Option shall not require the provision for transferability with
respect to any other Option.
A. Permitted Transferees. An Option or Reload Option
may be transferred or assigned by the Optionee only to one or more of
the following: (a) the Optionee's spouse, parents and lineal
descendants, including adopted children (the "Immediate Family
Members"); (b) a trust established by the Optionee and with respect to
which all beneficial interests are held by one or more of the Optionee,
the Immediate Family Members, and a tax-exempt charitable organization
which has only a contingent residual interest in the trust; (c) a
partnership or limited liability company established by the Optionee
and in which all beneficial interests are held by one or more of the
Optionee and the Immediate Family Members; (d) a tax-exempt
educational, religious or charitable organization, as those terms are
defined in Section 501(c)(3) of the Code; and (e) such other persons
and entities as the Company may specifically approve in writing after
written notice from the Optionee. The Company may require as a
condition to the transfer of any Option or Reload Option under this
Section that the transferee provide to the Company reasonable evidence
that the proposed transferee is described in one of the foregoing
clauses.
B. Permitted Transfers. Any transfer of an Option or
Reload Option under this Section 6.5.2 must be either a Donative
Transfer, a transfer to a partnership or limited liability company
described in clause (c) of Section 6.5.2.A above, or a transfer
specifically approved in writing by the Company after written notice
from the Optionee.
C. Minimum Transfer. Any transfer of an Option or a
Reload Option must be with respect to not less than one hundred (100)
shares of Optioned Stock and may be made only in whole number multiples
of one hundred (100) shares of Optioned Stock.
D. Notice to the Company. The Optionee shall give the
Company at least ten (10) days prior written notice of any proposed
transfer of an Option or Reload Option pursuant to this Section 6.5.2.A
and shall include with such notice:
10
<PAGE>
(1) The name and address of the proposed
transferee and a statement of the basis on which the proposed
transferee is a permitted transferee under Section 6.5.2.A
hereof; and
(2) The proposed transferee's written
agreement to accept the transferred Option or Reload Option
and any shares of Common Stock acquired on exercise of the
Option or Reload Option subject to all of the terms and
conditions of this Plan and the applicable Stock Option
Agreement, including the provisions dealing with the
termination of the Option or Reload Option on the death or
disability of the Optionee or the termination of the
Optionee's status as a Director of the Company.
E. No Further Transfer. Notwithstanding anything in
this Plan or any Stock Option Agreement to the contrary, a transferee
of any Option or Reload Option shall not have the right to further
transfer all or any portion of the transferred Option, other than (a)
by will or the laws of descent and distribution, or (b), if the
transferee is a trust, pursuant to the terms of the trust agreement by
reason of the death of any settlor.
F. Further Acts. The Company may require as a
condition to the transfer of any Option or Reload Option such
additional information and agreements from the Optionee and the
proposed transferee as the Company may deem necessary or beneficial for
purposes of complying with this Section or any applicable federal or
state law, rule or regulation.
G. Disclaimer. The Company's acceptance of any
transfer of an Option or Reload Option shall not be considered legal or
tax advice to the Optionee or the proposed transferee as to their
compliance with any applicable law, rule or regulation or the legal or
tax consequences of such transfer or the subsequent exercise of the
transferred Option or the sale or exchange of any of the shares of
Common Stock acquired on exercise of the transferred Option.
7. TERMS OF RESTRICTED STOCK GRANTS
7.1 Continued Services. As consideration for the issuance of the
Restricted Stock, in addition to payment of any purchase price, the Restricted
Stockholder shall agree to continue as a Director of the Company for a period of
at least one (1) year (or such shorter period as may be fixed by the
Administrator) after the Restricted Stock is issued. Nothing in this Plan or in
any Restricted Stock Agreement shall confer on any Restricted Stockholder any
right to continue as a Director of the Company for any period or any particular
period or shall interfere with or restrict in any way the rights of the Company
to terminate the Restricted Stockholder's status as a Director at any time for
any reason whatsoever, with or without cause.
7.2 Rights as Stockholders. Upon delivery of the shares of Restricted
Stock to the Restricted Stockholder, the Restricted Stockholder shall have,
unless otherwise provided by the Administrator, all the rights of a stockholder
with respect to said shares, subject to the restrictions in the Restricted Stock
Agreement, including the right to receive all dividends and other distributions
paid or made with respect to the Restricted Stock.
7.3 Restriction on Transfer. Notwithstanding anything in this Plan or
any Restricted Stock Agreement to the contrary, no Restricted Stockholder may
sell or otherwise transfer, whether or not for value, any of the Restricted
Stock prior to six (6) months after the date of the award of the Restricted
Stock.
11
<PAGE>
7.4 Restriction. All shares of Restricted Stock issued under this Plan
(including any shares of Common Stock and other securities issued with respect
to the shares of Restricted Stock as a result of stock dividends, stock splits
or similar changes in the capital structure of the Company) shall be subject to
such restrictions as the Administrator shall provide, which restrictions may
include, without limitation, restrictions concerning voting rights,
transferability of the Restricted Stock and restrictions based on the
continuation of the Restricted Stockholder's status as a Director of the
Company, and the Company's or the Restricted Stockholder's performance; provided
that the Administrator may, on such terms and conditions as it may determine to
be appropriate, remove any or all of such restrictions at any time and from time
to time. The restrictions, if any, imposed by the Administrator under this
Section need not be identical for all Restricted Stock and the imposition of any
restrictions with respect to any Restricted Stock shall not require the
imposition of the same or any other restrictions with respect to any other
Restricted Stock.
7.5 Repurchase of Unvested Restricted Stock. Each Restricted Stock
Agreement shall provide that the Company shall have the right to repurchase from
the Restricted Stockholder the unvested Restricted Stock upon a termination of
the Restricted Stockholder's status as a Director of the Company at a cash price
per share equal to the purchase price paid by the Restricted Stockholder for
such Restricted Stock; provided that provision may be made that no such right of
repurchase shall exist in the event of such a termination without cause or
following a Change In Control.
7.6 Repurchase of Vested Restricted Stock. In the discretion of the
Administrator, the Restricted Stock Agreement may provide that the Company shall
have the right to repurchase the vested Restricted Stock upon a termination of
the Restricted Stockholder's status as a Director of the Company at a cash price
per share equal to the then Fair Market Value of the Common Stock; provided that
provision may be made that no such right of repurchase shall exist in the event
of such a termination without cause or following a Change In Control.
7.7 Legend. The Administrator shall cause a legend or legends to be
placed on certificates representing shares of Restricted Stock that are subject
to restrictions under Restricted Stock Agreements, which legend or legends shall
make appropriate reference to the applicable restrictions.
8. CONDITIONS UPON ISSUANCE OF SHARES
8.1 Compliance with Law. Shares of Common Stock shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
8.2 Investment Intent. As a condition to the exercise of an Option, the
Company may require the person exercising such Option to represent and warrant
at the time of any such exercise that the shares of Common Stock are being
purchased only for investment and without any present intention to sell or
distribute such shares if, in the opinion of counsel for the Company, such a
representation is required by applicable law.
8.3 Governmental Consents. Inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the
Company's counsel to be necessary to the lawful issuance and sale of any shares
of Common Stock hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell, or any delay in issuing or selling, such shares
as to which such requisite shall not have been obtained.
12
<PAGE>
9. TAX WITHHOLDING
To the extent that the exercise of any Option (including any Reload
Option) granted hereunder gives rise to an income tax withholding obligation on
the part of the Company with respect to the Optionee, the Company may satisfy
such obligation on such terms and in accordance with such procedures as it deems
appropriate under applicable law. At the election of the Optionee, such
withholding obligation may be satisfied through the Optionee's surrender of
shares of Common Stock owned by the Optionee or through the Company's retention
of shares of the Common Stock which would otherwise be issued as a result of the
exercise of the Option. If withholding is made in shares of Common Stock, the
Company shall grant to the Optionee a Reload Option, on the terms specified in
Section 6.4 hereof for the number of shares so withheld.
10. ADMINISTRATION
10.1 Procedure. The Plan shall be administered by the Board of
Directors or the Committee. The Committee shall consist of not less than two (2)
Directors all of whom shall be Non-Employee Directors of the Company within the
meaning of Rule 16b-3. Once appointed, the Committee shall continue to
administer the Plan until otherwise directed by the Board of Directors. The
Board of Directors may increase the size of the Committee and may appoint
additional members, remove members (with or without cause) and substitute new
members, fill vacancies (however caused), and remove all members of the
Committee and thereafter directly administer the Plan, all to the extent
permitted by Applicable Law. No member of the Board of Directors or the
Committee shall be liable for any action or determination undertaken or made in
good faith with respect to the Plan or any agreement executed pursuant to the
Plan. Subject to the terms of this Plan, the Board of Directors or the Committee
shall determine:
10.2 Powers of the Administrator. Subject to the provisions of the
Plan, the Administrator shall have the authority, in its discretion, to:
10.2.1 Select the Directors to whom Options, Restricted Stock
and other Awards may be granted or awarded hereunder;
10.2.2 Determine whether and to what extent Options,
Restricted Stock and other Awards are granted or awarded hereunder;
10.2.3 Determine the number of shares of Common Stock to be
covered by Options, Restricted Stock and other Awards granted or awarded
hereunder;
10.2.4 Determine the Fair Market Value of the Common Stock in
accordance with Section 2.16 hereof;
10.2.5 Approve forms of the Option Agreements and the
Restricted Stock Agreements, which Agreements need not be identical;
10.2.6 Determine the terms and conditions, not inconsistent
with the terms of this Plan, of any award granted hereunder, including, but not
limited to, the exercise price, the time or times when Options or Restricted
Stock may be exercised or become vested (which may be based on performance
criteria), any vesting acceleration or waiver of forfeiture restrictions, and
any restriction or limitation regarding any Option or Restricted Stock or the
shares of Common Stock relating thereto, based in each case on such factors as
the Administrator, in its sole discretion, shall determine;
13
<PAGE>
10.2.7 Construe and interpret the terms of the Plan and awards
granted under the Plan;
10.2.8 Prescribe, amend and rescind rules and regulations
relating to the Plan;
10.2.9 Modify or amend each Option or Restricted Stock;
10.2.10 Authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option or the award of
Restricted Stock previously authorized by the Administrator;
10.2.11 Determine the terms and restrictions applicable to
Options and any Restricted Stock; and
10.2.12 Make all other determinations deemed necessary or
advisable for administering the Plan.
10.3 Committee Procedure. If the Committee acts as the Administrator,
the Administrator shall act pursuant to the vote or written consent of a
majority of its members, and minutes shall be kept of all of its meetings and
copies thereof shall be provided to the Board of Directors. Subject to the
provisions of the Plan and the directions of the Board of Directors, the
Committee may establish and follow such other rules and regulations for the
conduct of its business as it may deem advisable.
10.4 Professional Assistance; Good Faith Actions. The Administrator
may, with the approval of the Board of Directors, employ and rely on the advice
of attorneys, consultants, accountants, appraisers, brokers, or other persons.
All actions taken and all interpretations and determinations made by the
Administrator in good faith shall be final and binding upon all Optionees,
Restricted Stockholders, the Company and all other interested persons. No member
of the Administrator or the Board of Directors or any officer, employee or agent
of the Company shall be personally liable for any action, determination or
interpretation made by the Administrator in good faith with respect to this
Plan, any Options or Restricted Stock granted or awarded under this Plan, or any
Option Agreement or Restricted Stock Agreement.
10.5 Indemnification. In addition to any other rights of
indemnification they may have, the Administrator and the members of the
Administrator shall be indemnified by the Company against reasonable expenses,
including attorneys' fees and costs, incurred in connection with the defense of
any claim, action, suit, or proceeding, or in connection with any appeal
thereof, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan, any Option or
Restricted Stock granted or awarded thereunder, or any Option Agreement or
Restricted Stock Agreement, and against all amounts paid by them in settlement
thereof (provided such settlement is approved by independent legal counsel
selected by the Company) or paid by them in satisfaction of a judgment in any
action, suit, or proceeding; provided that the foregoing indemnification shall
not apply to matters as to which it shall be adjudged in such action, suit, or
proceeding that the Administrator or such member is liable for gross negligence
or willful misconduct in the performance of his or her duties. The
indemnification provided in this Section shall be available only if, within
sixty (60) days after institution of any such claim, action, suit, or
proceeding, the Administrator or the member thereof seeking indemnification
shall in writing offer the Company the opportunity, at its own expense, to
handle and defend such claim, action, suit or proceeding.
14
<PAGE>
11. ADJUSTMENT OF SHARES
11.1 Recapitalization of the Company. Except as otherwise provided
herein, appropriate and proportionate adjustments shall be made in the number
and class of shares subject to the Plan and to the Options granted under the
Plan, and the exercise price of such Options, in the event of a stock dividend
(but only on Common Stock), stock split, reverse stock split, recapitalization,
reorganization or like change in the capital structure of the Company. To the
extent that the foregoing adjustments relate to stock or securities of the
Company, such adjustments shall be made by the Committee, the determination of
which in that respect shall be final, binding, and conclusive.
11.2 Reorganization or Liquidation of the Company.
11.2.1 Operative Events. In the event of (a) the complete
liquidation of the Company, or (b) a merger, reorganization, or consolidation of
the Company with any other corporation (other than a Subsidiary of the Company)
in which the Company is not the surviving corporation or the Company becomes an
eighty percent (80%) or more owned subsidiary of another corporation, or (c) any
sale of all or substantially all of the Company's assets, any unexercised
Options then outstanding under the Plan shall be deemed canceled as of the
effective date of any such liquidation, merger, reorganization, consolidation or
sale, unless the surviving corporation in any such merger, reorganization or
consolidation or the acquiring corporation in any such sale elects to assume the
Options under the Plan or to issue substitute options in place thereof; provided
that, if any Options granted under the Plan would be canceled in accordance with
the foregoing, the Optionee shall have the right, exercisable during a 10-day
period ending on the fifth day prior to the effective date of such liquidation,
merger, reorganization, consolidation or sale, to exercise the Options in whole
or in part even though the Option otherwise was not then exercisable.
Notwithstanding anything in this Plan or any Stock Option Agreement to the
contrary, the Company shall not be deemed to have been liquidated by reason of
the merger or consolidation of the Company with or into a Subsidiary of the
Company in a transaction in which the Company is not the surviving corporation.
11.2.2 Notice of Event. The Company shall give each Optionee
at least thirty (30) days' prior written notice of the anticipated effective
date of any such liquidation, merger, reorganization, consolidation or sale.
Notwithstanding anything in this Plan or in any Stock Option Agreement to the
contrary, (i) all Option exercises effected during the foregoing 10-day period
shall be deemed to be effective immediately prior to the closing of such
liquidation, merger, reorganization, consolidation or sale and (ii) if the
Company abandons or otherwise fails to close any such liquidation, merger,
reorganization, consolidation or sale, then (A) all exercises during the
foregoing 10-day period shall cease to be effective ab initio and (B) the
outstanding Options shall be exercisable as otherwise determined under the
applicable Stock Option Agreements and without consideration of this Section
11.2.2 or the corresponding provisions of any Stock Option Agreement.
12. TERM; TERMINATION; AND AMENDMENT OF PLAN
12.1 Term of Plan. This Plan has been adopted by the Board of Directors
as of February 27, 1996. The term of the Plan shall begin as of February 27,
1996, and shall continue until December 31, 2005, unless terminated sooner in
accordance with the provisions of the Plan.
15
<PAGE>
12.2 Amendment And Termination Of The Plan
12.2.1 Amendment and Termination. The Board of Directors may
at any time amend, alter, suspend or terminate the Plan.
12.2.2 Stockholder Approval. The Company shall obtain
stockholder approval of any Plan amendment to the extent necessary to comply
with Applicable Law, including the requirements of any exchange or quotation
system on which the Common Stock is listed or quoted. Such stockholder approval,
if required, shall be obtained in such a manner and to such a degree as is
required by the Applicable Law.
12.2.3 Effect of Amendment or Termination. No amendment,
alteration, suspension or termination of the Plan shall impair the rights of any
Optionee or Restricted Stockholder, unless mutually agreed otherwise between the
Optionee or the Restricted Stockholder and the Administrator, which agreement
must be in writing and signed by the Optionee or the Restricted Stockholder and
the Company.
12.3 Effect Of Amendments
12.3.1 Amendment of Options. From and after the Effective
Date, the date of this Amended Plan, all of the terms and provisions of the Plan
as amended shall apply to all Options which are outstanding as of such date and
the Stock Option Agreements covering such Options shall be deemed automatically
amended to reflect the amended terms of this Plan.
12.3.2 No Change in Price or Term. Notwithstanding anything in
this Plan to the contrary, in no event shall the amendment of any Stock Option
Agreement in accordance with the provisions of this Section change any or all of
the number of shares covered by any Option or the exercise price, vesting
schedule or term of the Option.
12.3.3 Amended Stock Option Agreements. Any Optionee who holds
an Option that is deemed amended under this Section may at any time deliver to
the Company his or her existing Stock Option Agreement and request that the
Company deliver to the Optionee a new Stock Option Agreement incorporating the
amended and restated terms and provisions of the Plan. The Company shall deliver
to the Optionee a new Stock Option Agreement promptly after the Optionee's
delivery of the existing Stock Option Agreement. NOTWITHSTANDING ANYTHING IN
THIS PLAN TO THE CONTRARY, THE OPTIONEE SHALL BE SOLELY RESPONSIBLE FOR
DETERMINING WHETHER THE AMENDMENT OF A STOCK OPTION AGREEMENT WILL CONSTITUTE A
MODIFICATION OF THE OPTION AND THE COMPANY SHALL HAVE NO RESPONSIBILITY OR
LIABILITY TO THE OPTIONEE BY REASON OF THE AMENDMENT OF A STOCK OPTION AGREEMENT
BEING A MODIFICATION OF THE OPTION.
16
<PAGE>
CERTIFICATE OF SECRETARY
The undersigned, being the Corporate Secretary of the Company, does
hereby certify that the Amended and Restated Directors Stock Plan effective as
of February 22, 2000, was adopted by the Board of Directors of the Company at a
duly called and held meeting of the Board of Directors on February 22, 2000, and
was duly approved by the stockholders of the Company duly held on April 25,
2000.
Dated: August 9, 2000
----------------------------------------
Jay D. Smith, Esq., Corporate Secretary
17
