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Exhibit 10(l)
FIRST TENNESSEE NATIONAL CORPORATION
1995 EMPLOYEE STOCK OPTION PLAN
(As Amended and Restated April 18, 2000)
1. Purpose. The 1995 Employee Stock Option Plan (the "Plan") of First
Tennessee National Corporation and any successor thereto (the "Company") is
designed to enable employees of the Company and its subsidiaries to obtain a
proprietary interest in the Company, and thus to share in the future success of
the Company's business. Accordingly, the Plan is intended as a further means
not only of attracting and retaining outstanding personnel, but also of
promoting a closer identity of interest between employees and shareholders.
2. DEFINITIONS. As used in the Plan, the following terms shall have the
respective meanings set forth below:
(a) "Change in Control" means the occurrence of any one of the
following events:
(i) individuals who, on January 21, 1997, constitute the Board
(the "Incumbent Directors") cease for any reason to constitute at
least a majority of the Board, provided that any person becoming a
director subsequent to January 21, 1997, whose election or nomination
for election was approved by a vote of at least three-fourths (3/4) of
the Incumbent Directors then on the Board (either by a specific vote
or by approval of the proxy statement of the Company in which such
person is named as a nominee for director, without written objection
to such nomination) shall be an Incumbent Director; provided, however,
that no individual elected or nominated as a director of the Company
initially as a result of an actual or threatened election contest with
respect to directors or as a result of any other actual or threatened
solicitation of proxies or consents by or on behalf of any person
other than the Board shall be deemed to be an Incumbent Director;
(ii) any "Person" (as defined under Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and
as used in Section 13(d) or Section 14(d) of the Exchange Act) is or
becomes a "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 20% or more of the combined voting power of the Company's
then outstanding securities eligible to vote for the election of the
Board (the "Company Voting Securities"); provided, however, that the
event described in this paragraph (ii) shall not be deemed to be a
change in control by virtue of any of the following acquisitions: (A)
by the Company or any entity in which the Company directly or
indirectly beneficially owns more than 50% of the voting securities or
interests (a "Subsidiary"), (B) by an employee stock ownership or
employee benefit plan or trust sponsored or maintained by the Company
or any Subsidiary, (C) by any underwriter temporarily holding
securities pursuant to an offering of such securities, or (D) pursuant
to a Non-Qualifying Transaction (as defined in paragraph (iii));
(iii) the shareholders of the Company approve a merger,
consolidation, share exchange or similar form of corporate transaction
involving the Company or any of its Subsidiaries that requires the
approval of the Company's shareholders, whether for such transaction
or the issuance of securities in the transaction (a "Business
Combination"), unless immediately following such Business Combination:
(A) more than 50% of the total voting power of (x) the corporation
resulting from such Business Combination (the "Surviving
Corporation"), or (y) if applicable, the ultimate parent corporation
that directly or indirectly has beneficial ownership of 100% of the
voting securities eligible to elect directors of the Surviving
Corporation (the "Parent Corporation"), is represented by Company
Voting Securities that were outstanding immediately prior to the
consummation of such Business Combination (or, if applicable, is
represented by shares into which such Company
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Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company
Voting Securities among the holders thereof immediately prior to the
Business Combination, (B) no person (other than any employee benefit
plan sponsored or maintained by the Surviving Corporation or the
Parent Corporation), is or becomes the beneficial owner, directly or
indirectly, of 20% or more of the total voting power of the
outstanding voting securities eligible to elect directors of the
Parent Corporation (or, if there is no Parent Corporation, the
Surviving Corporation) and (C) at least a majority of the members of
the board of directors of the Parent Corporation (or, if there is no
Parent Corporation, the Surviving Corporation) were Incumbent
Directors at the time of the Board's approval of the execution of the
initial agreement providing for such Business Combination (any
Business Combination which satisfies all of the criteria specified in
(A), (B) and (C) above shall be deemed to be a "Non-Qualifying
Transaction"); or
(iv) the shareholders of the Company approve a plan of complete
liquidation or dissolution of the Company or a sale of all or
substantially all of the Company's assets.
Computations required by paragraph (iii) shall be made on and as of
the date of shareholder approval and shall be based on reasonable assumptions
that will result in the lowest percentage obtainable.
Notwithstanding the foregoing, a change in control of the Company
shall not be deemed to occur solely because any person acquires beneficial
ownership of more than 20% of the Company Voting Securities as a result of the
acquisition of Company Voting Securities by the Company which reduces the
number of Company Voting Securities outstanding; provided, that if after such
acquisition by the Company such person becomes the beneficial owner of
additional Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such person, a
change in control of the Company shall then occur.
(b) "Committee" means the Stock Option Committee or any successor
committee designate by the Board of Directors to administer
the Stock Option Plan, as provided in Section 5(a) hereof.
(c) "Early Retirement" means termination of employment after an
employee has fulfilled all service requirements for an early
pension, and before his or her Normal Retirement Date, under
the terms of the First Tennessee National Corporation Pension
Plan, as amended from time to time.
(d) "Quota" means the portion of the total number of shares
subject to an option which the grantee of the option may
purchase during several periods of the term of the option (if
the option is subject to quotas), as provided in Section 8(b)
hereof. SAR's are granted, if at all, at the time of granting
a stock option. If a stock option is subject to quotas, the
related SAR is subject to the same quotas.
(e) "Retirement" means termination of employment after an
employee has fulfilled all service requirements for a pension
under the terms of the First Tennessee National Corporation
Pension Plan, as amended from time to time.
(f) "Subsidiary" means a subsidiary corporation as defined in
Section 425 of the Internal Revenue Code.
(g) "Successor" means the legal representative of the estate of a
deceased grantee or the person or persons who shall acquire
the right to exercise an option or related SAR by bequest or
inheritance or by reason of the death of the grantee, as
provided in Section 10 hereof.
(h) "Term of the Option" means the period during which a
particular option or related SAR may be exercised in Section
8(a) hereof.
(i) "Three months after cessation of employment" means a period
of time beginning at 12:01 A.M. on the day following the date
notice of termination of employment was given and ending at
11:59 P.M. on the date in the third following month
corresponding numerically with the date notice of termination
of employment was given ( or in the event that the third
following month does not have a date so
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corresponding, then the last day of the third following
month).
(j) "Five years after (an event occurring on day x)" and "five
years from (an event occurring on day x)" means a period of
time beginning at 12:01 A.M. on the day following day x and
ending at 11:59 P.M. on the date in the fifth following year
corresponding numerically with day x (or in the event that
the fifth following year does not have a date so
corresponding, then the last day of the sixtieth following
month).
(k) "Voluntary Resignation" means any termination of employment
that is not involuntary and that is not the result of the
employee's death, disability, early retirement or retirement.
3. EFFECTIVE DATE OF PLAN. The Plan shall become effective when approved
at a shareholder's meeting by the holders of a majority of the shares of
Company common stock present or represented at the meeting and entitled to vote
on the Plan. No options or related SAR's may be granted under the Plan after
the month and day in the year 2005 corresponding to the day before the month
and day on which the Plan becomes effective. The term of option granted on or
before such date may, however, extend beyond that date, but no incentive stock
options may be granted which are exercisable after the expiration of ten (10)
years after the date of the grant.
4. SHARES SUBJECT TO THE PLAN.
(a) The Company may grant options and related SAR's under the
Plan authorizing the issuance of no more than 3,000,000
shares of its $1.25 par value common stock, which will be
provided from shares purchased in the open market or
privately (that became authorized but unissued shares under
state corporation law) or by the issuance of previously
authorized but unissued shares.
(b) When an option is granted under the Plan, the Committee in
its sole discretion may include the grant of a SAR permitting
the grantee to elect to receive stock or cash or a
combination thereof in exchange for the surrender the
unexercised related option or portion thereof. Solely with
respect to grantees subject to the reporting and short-swing
profits provisions of Section 16 of the Securities Exchange
Act of 1934 ("Section 16 grantees"), the Committee shall have
the sole discretion to consent to or disapprove the election
of the grantee to receive cash in full or partial settlement
of the SAR. With respect to all other grantees, the election
is final without any action by the Committee.
(c) Shares as to which options and related SAR's previously
granted under this Plan shall for any reason lapse shall be
restored to the total number available for grant of options.
Shares subject to options surrendered in exchange for the
exercise of a SAR shall not be restored to the total number
available for the grant of options or related SAR's.
5. PLAN ADMINISTRATION.
(a) The Plan shall be administered by a Stock Option Committee
(the "Committee") whose members shall be appointed from time
to time by, and shall serve at the pleasure of, the Board of
Directors of the Company. In addition, all members shall be
directors and shall meet the definitional requirements for
"disinterested person" (with any exceptions therein
permitted) contained in the then current SEC Rule 16b-3 or
any successor provision.
(b) The Committee shall adopt such rules of procedure as it may
deem proper.
(c) The powers of the Committee shall include plenary authority
to interpret the Plan, and subject to the provisions hereof,
to determine the persons to whom options and related SAR's
shall be granted, the number of shares subject to each option
and related SAR, the term of option and related SAR, and the
date on which options and related SAR's shall be granted.
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6. ELIGIBILITY.
(a) Options and related SAR's may be granted under the Plan to
employees of the Company or any subsidiary selected by the
Committee. Determination by the Committee of the employees to
whom options and related SAR's shall be granted shall be
conclusive.
(b) An individual may receive more than one option and related
SAR, subject, however, to the following limitations: (i) in
the case of an incentive stock option (as described in
Section 422A of the Internal Revenue Code of 1986), the
aggregate fair market value (determined at the time the
options are granted) of the Company's common stock with
respect to which incentive stock options are exercisable for
the first time during any calendar year by any individual
employee (under this Plan and all other similar plans of the
Company and its subsidiaries) shall not exceed $100,000, and
(ii) the maximum number of shares with respect to which
options or SAR's are granted to an individual during the term
of the Plan, as defined in Section 3 hereof, shall not exceed
200,000 shares. Incentive stock options granted hereunder
shall be clearly identified as such at the time of grant.
7. OPTION PRICE. The option price per share to be paid by the grantee to
the Company upon exercise of the option shall be determined by the Committee,
but shall not be less than 100% of the fair market value of the share at the
time the option is granted, nor shall the price per share be less than the par
value of the share. Notwithstanding the prior sentence, the option price per
share may be less than 100% of the fair market value of the share at the time
the option is granted if:
(a) The grantee of the option has entered into an agreement with
the Company pursuant to which the grant of the option is in
lieu of the payment of compensation; and
(b) The amount of such compensation when added to the cash
exercise price of the option equals at least 100% of the fair
market value (at the time the option is granted) of the
shares subject to option.
"Fair market value" for purposes of the Plan shall be the mean between the high
and low sales prices at which shares of the Company were sold on the valuation
day as quoted by the Nasdaq Stock Market or, if there were no sales on that
day, then on the last day prior to the valuation day during which there were
sales. In the event that this method of valuation is not practicable, then the
Committee, in its discretion, shall establish the method by which fair market
value shall be determined.
8. TERMS OR QUOTAS OF OPTIONS AND RELATED SAR'S:
(a) TERM. Each option and related SAR granted under the Plan
shall be exercisable only during a term (the "Term of the
Option") commencing one year, or such other period of time
(which may be less than or more than one year) as is
determined to be appropriate by the Committee, after the date
when the option or related SAR was granted and ending (unless
the option and related SAR shall have terminated earlier
under other provisions of the Plan) on a date to be fixed by
the Committee. Notwithstanding the foregoing, each option and
related SAR granted under the Plan shall become exercisable
in full immediately upon a Change in Control.
(b) QUOTAS. The Committee shall have authority to grant options
and related SAR's exercisable in full at any time during
their term, or exercisable in quotas. Quotas or portions
thereof not purchased in earlier periods shall be cumulated
and be available for purchase in later periods. In exercising
his or her option or related SAR, the grantee may purchase
less than the full quota available to him or her.
(c) EXERCISE OF STOCK OPTIONS. Stock options shall be exercised
by delivering, mailing, or transmitting to the Committee or
its designee the following items:
(i) A notice, in the form, by the method, and at times
prescribed by the Committee, specifying the
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number of shares to be purchased; and
(ii) A check or money order payable to the Company for the
full option price.
In addition, the Committee in its sole discretion may
determine that it is an appropriate method of payment for
grantees to pay, or make partial payment of, the option price
with shares of Company common stock, $1.25 par value, in lieu
of cash. In addition, in its sole discretion the Committee
may determine that it is an appropriate method of payment for
grantees to pay for any shares subject to an option by
delivering a properly executed exercise notice together with
a copy of irrevocable instructions to a broker to deliver
promptly to the Company the amount of sale or loan proceeds
to pay the purchase price. To facilitate the foregoing, the
Company may enter into agreements for coordinated procedures
with one or more brokerage firms. The value of Company common
stock surrendered in payment of the exercise price shall be
its fair market value, determined pursuant to Section 7, on
the date of exercise. Upon receipt of such notice of exercise
of a stock option and upon payment of the option price by a
method other than a cashless exercise, the Company shall
promptly deliver to the grantee (or in the event the grantee
has executed a deferral agreement, the Company shall deliver
to the grantee at the time specified in such deferral
agreement) a certificate or certificates for the shares
purchased, without charge to him or her for issue or transfer
tax.
(d) EXERCISE OF SAR'S. Except as required by subsection 8(e), a
SAR shall be exercised by delivering, mailing, or
transmitting to the Committee or its designee a notice in the
form, by the method, and at times prescribed by the
Committee, specifying the grantee's election, in accordance
with Subsection 4(b), to receive cash, stock, or a
combination thereof in full or partial settlement of the SAR,
or a portion thereof.
(e) CASH SETTLEMENTS OF SAR'S BY SECTION 16 GRANTEES.
Notwithstanding subsection 8(d), solely with respect to
Section 16 grantees, an election to receive cash in full or
partial settlement of a SAR or a portion thereof and the
actual exercise of such SAR shall be made by delivering,
mailing, or transmitting, to the Committee or its designee
during the period beginning on the third business day
following the release for publication of the Company's
quarterly or annual sales and earnings and ending on the
twelfth business day following such date a notice, in the
form and by the method prescribed by the Committee,
specifying the grantee's election to receive cash in full or
partial settlement of the SAR, or a portion thereof. Such
notice shall constitute both the grantee's election to
receive cash and the actual exercise of the SAR for a cash
settlement.
(f) SAR PAYMENTS. Upon the exercise of a SAR in accordance with
subsection 8(d), the Company shall promptly deliver to the
grantee stock or cash or a combination thereof, in such
proportion as has been elected by the grantee pursuant to
subsection 8(d), equal to:
(i) The fair market value, as determined in Section 7,
of one share of Company common stock on the date of exercise
of the SAR: minus
(ii) The option price of the related option; multiplied by
(iii) The number of shares subject to option which are
being surrendered in exercise of the SAR, or portion thereof.
Provided, however, solely for the purpose of exercising an
SAR, the per share gain to the grantee as measured by the
difference between the fair market value, as described in
(i), and the option price, as described in (ii), shall not
exceed 200% of the option price. For example, if the option
price is $12 per share, the gain may not exceed $24 per share
or, in this example, be based on a fair market value at the
time of exercise in excess of $36.
(g) SAR PAYMENTS TO SECTION 16 GRANTEES. Upon the exercise of a
SAR in accordance with subsection 9(e), the Company shall
promptly deliver to the grantee cash or the combination of
stock and cash, in
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such proportion as has been elected by the grantee and
consented to by the Committee pursuant to subsections 4(b)
and 8(e), equal to:
(i) The highest fair market value, as determined in
Section 7, of one share of Company common stock occurring
during ten business day period specified in subsection 8(e)
during which the grantee makes his election and exercises the
SAR; minus
(ii) The option price of the related option; multiplied by
(iii) The number of shares subject to option which are
being surrendered in exercise of the SAR, or portion thereof.
Provided, however, solely for the purpose of exercising an
SAR, the per share gain to the grantee as measured by the
difference between the fair market value, as described in
(i), and the option price, as described in (ii), shall not
exceed 200% of the option price. For example, if the option
price is $12 per share, the gain may not exceed $24 per share
or, in this example, be based on a fair market value at the
time of exercise in excess of $36.
(h) POSTPONEMENTS. The Committee may postpone any exercise of an
option or related SAR for such period of time as the
Committee in its discretion reasonably believes necessary to
prevent any acts or omissions that the Committee reasonably
believes will be or will result in the violation of any state
or federal law; and the Company shall not be obligated by
virtue of any provision of the Plan or the terms of any prior
grant of an option or related SAR to recognize the exercise
of an option or related SAR or to sell or issue shares during
the period of such postponement. Any such postponement shall
automatically extend the time within which the option or
related SAR may be exercised, as follows: The exercise period
shall be extended for a period of time equal to the number of
days of the postponement, but in no event shall the exercise
period be extended beyond the last day of the postponement
for more days than there were remaining in the option or
related SAR's exercise period on the first day of the
postponement. Neither the Company, nor its directors of
officers, shall have any obligation or liability to the
grantee of an option or related SAR or to a successor with
respect to any shares as to which the option or related SAR
shall lapse because of such postponement.
(i) NON-TRANSFERABILITY. All options and related SAR's granted
under the Plan shall be non-transferable other than by will
or by the laws of descent and distribution, subject to
Section 10 hereof, and an option or related SAR may be
exercised during the lifetime of the grantee only by him or
her or by his/her guardian or legal representative. Also, if
required by the then current Rule 16b-3, or any successor
provision, and solely with respect to Section 16 grantees,
common stock acquired upon the exercise of an option or
related SAR may not be sold for at least six months after
acquisition, except in the case of such grantee's death or
disability. Also, if required by the then current Rule 16b-3,
or any successor provision, and solely with respect to
Section 16 grantees, then notwithstanding anything hereunto
the contrary, options and SAR's are not exercisable for at
least six months after grant except in the case of death or
disability.
(j) CERTIFICATES. The stock certificate or certificates to be
delivered under this Plan may, at the request of the grantee,
be issued in his or her name or, with the consent of the
Company, the name of another person as specified by the
grantee.
(k) RESTRICTIONS. This subsection (k) shall be void and of no
legal effect in the event of a Change of Control.
Notwithstanding anything in any other section or subsection
herein to the contrary, the following provisions shall apply
to all options and related SAR's (except options and, if any,
related SAR's designated by the Committee as FirstShare
options and related SAR's), exercises and grantees. An amount
equal to the spread realized in connection with the exercise
of an option or SAR within six months prior to a grantee's
voluntary resignation shall be paid to the Company by the
grantee in the event that the grantee, within six months
following voluntary resignation, engages, directly or
indirectly, in any activity determined by the Committee to be
competitive with any activity of the
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Company or any of its subsidiaries.
(l) TAXES. The Company shall be entitled to withhold the amount
of any tax attributable to amounts payable or shares
deliverable under the Plan, and the Company may defer making
payment or delivery of any benefits under the Plan if any tax
is payable until indemnified to its satisfaction. The
Committee may, in its discretion and subject to such rules
which it may adopt, permit a grantee to satisfy, in whole or
in part, any federal, state and local withholding tax
obligation which may arise in connection with the exercise of
a stock option or SAR, by electing either:
(i) To have the Company withhold shares of Company common
stock from the shares to be issued upon the exercise of the
option or SAR;
(ii) To permit a grantee to tender back shares of Company
common stock issued upon the exercise of an option or SAR; or
(iii) To deliver to the Company previously owned shares of
Company common stock having a fair market value equal to the
amount of the federal, state, and local withholding tax
associated with the exercise of the option or SAR.
(m) ADDITIONAL PROVISIONS APPLICABLE TO OPTION AGREEMENTS IN LIEU
OF COMPENSATION. If the Committee, in its discretion permits
participants to enter into agreements as contemplated by
Section 7 herein, then such agreements must be irrevocable
and cannot be changed by the participant once made, and such
agreements must be made at least prior to the performance of
any services with respect to which an option may be granted.
Also, solely with respect to Section 16 grantees, the date of
the grant of any option pursuant to an agreement contemplated
by Section 7 herein must be at least six months after the
date on which a participant enters into such agreement, and
the exercise price must be determined by reference to the
fair market value of the Company's shares on the date of
grant. If any participant who enters into such an agreement
terminates employment prior to the grant of the option, then
the option will not be granted and all compensation which
would have been covered by the option will be paid to the
participant in cash.
9. EXERCISE OF OPTION BY GRANTEE ON CESSATION OF EMPLOYMENT. If a person
to whom an option has been granted shall cease, for a reason other than his or
her death, disability, early retirement, retirement, or voluntary resignation,
to be employed by the Company or a subsidiary, the option and related SAR shall
terminate three months after the cessation of employment, unless it terminates
earlier under other provisions of the Plan. Until the option or related SAR
terminates, it may be exercised by the grantee for all or a portion of the
shares as to which the right to purchase had accrued under the Plan at the time
of cessation of employment, subject to all applicable conditions and
restrictions provided in Section 8 hereof. If a person to whom an option or
related SAR has been granted shall retire or become disabled, the option and
related SAR shall terminate five years after the date of early retirement,
retirement or disability, unless it terminates earlier under the Plan. Although
such exercise by a retiree or disabled grantee is not limited to the exercise
rights which had accrued at the date of early retirement, retirement or
disability, such exercise shall be subject to all applicable conditions and
restrictions prescribed in Section 8 hereof. If a person shall voluntarily
resign, his option and related SAR to the extent not previously exercised shall
terminate at once. In the event that the sale of certain assets and assumption
of certain liabilities (referred to herein as "the sale of the Division") of
the HomeBanc Mortgage Corporation division (the "Division") of First Horizon
Home Loan Corporation occurs, then notwithstanding anything herein to the
contrary, if the grantee of one or more stock options described in the second
sentence of Section 7 of the Plan is employed by the Division immediately prior
to the closing of the sale of the Division and is not an employee of the
Equibanc department of the Division and if the employment of the grantee of
such option or options terminates at the time of the closing of the sale of the
Division, then each of such stock options shall terminate at 5:00 p.m. Memphis
time on the fifth anniversary of the closing of the sale of the Division (or if
such date is not a business day, then on the immediately preceding business
day), unless it terminates earlier under the Plan. The exercise of each of such
options is subject to all applicable conditions and restrictions provided in
Section 8 hereof.
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10. EXERCISE OF OPTION OR RELATED SAR AFTER DEATH OF GRANTEE. If the
grantee of an option and related SAR shall die while in the employ of the
Company or within three months after ceasing to be an employee, and if the
option and related SAR was in effect at the time of his or her death (whether
or not its term had then commenced), the option and related SAR may, until the
expiration of five years from the date of death of the grantee or until the
earlier expiration of the term of the option and related SAR, be exercised by
the successor of the deceased grantee. Although such exercise is not limited to
the exercise rights which had accrued at the date of death of the grantee, such
exercise shall be subject to all applicable conditions and restrictions
prescribed in Section 8 hereof.
11. PYRAMIDING OF OPTIONS. The Committee in its sole discretion may from
time to time permit the method of exercising options known as pyramiding (the
automatic application of shares received upon the exercise of a portion of a
stock option to satisfy the exercise price for additional portions of the
option).
12. SHAREHOLDER RIGHTS. No person shall have any rights of a shareholder by
virtue of a stock option and related SAR except with respect to shares actually
issued to him or her, and issuance of shares shall confer no retroactive right
to dividends.
13. ADJUSTMENT FOR CHANGES IN CAPITALIZATION. Any increase in the number of
outstanding shares of common stock of the Company occurring through stock
splits or stock dividends after the adoption of the Plan shall be reflected
proportionately:
(a) In an increase in the aggregate number of shares then
available for the grant of options and related SAR's under
the Plan, or becoming available through the termination of
options and related SAR's previously granted but unexercised;
(b) In the number available to grant to any one person;
(c) In the number subject to options and related SAR's then
outstanding; and
(d) In the quotas remaining available for exercise under
outstanding options and related SAR's,
and a proportionate reduction shall be made in the per-share option price as to
any outstanding options and related SAR's or portions thereof not yet
exercised. Any fractional shares resulting from such adjustments shall be
eliminated. If changes in capitalization other than those considered above
shall occur, the Board of Directors shall make such adjustments in the number
and class of shares for which options and related SAR's may thereafter be
granted, and in the number and class of shares remaining subject to options and
related SAR's previously granted and in the per-share option price as the Board
in its discretion may consider appropriate, and all such adjustments shall be
conclusive; provided, however, that the Board shall not make any adjustments
with respect to the number of shares subject to previously granted incentive
stock options or available for grant as options if such adjustment would
constitute the adoption of a new plan requiring shareholder approval before
further incentive stock options could be granted.
14. TERMINATION, SUSPENSION, OR MODIFICATION OF PLAN. The Board of
Directors may at any time terminate, suspend, or modify the Plan, except that
the Board of Directors shall not amend the Plan in violation of law and shall
not, without shareholder approval, make any amendment to the Plan (other than
amendments pursuant to Section 13 herein) that would:
(a) Increase the number of shares specified in Section 4(a);
(b) Extend the duration of the Plan specified in Section 3; or
(c) Modify the class of employees eligible to receive options and
related SAR's under the Plan.
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No termination, suspension, or modification of the Plan shall adversely affect
any right acquired by any grantee, or by any successor of a grantee (as
provided in Section 10 hereof), under the terms of an option and related SAR's
granted before the date of such termination, suspension, or modification,
unless such grantee or successor shall consent, but it shall be conclusively
presumed that any adjustment for changes in capitalization as provided in
Section 13 does not adversely affect any such right.
15. APPLICATION OF PROCEEDS. The proceeds received by the Company from the
sale of its shares under the Plan will be used for general corporate purposes.
16. NO RIGHT TO EMPLOYMENT. Neither the adoption of the Plan nor the
granting of any stock option or SAR shall confer upon the grantee any right to
continue in the employ of the Company or any of its subsidiaries or interfere
in any way with the right of the Company or the subsidiary to terminate such
employment at any time.
17. SUCCESSORS. This Plan shall bind any successor of the Company, its
assets or its businesses (whether direct or indirect, by purchase, merger,
consolidation or otherwise), in the same manner and to the same extent that the
Company would be obligated under this Plan if no succession had taken place. In
the case of any transaction in which a successor would not by the foregoing
provision or by operation of law be bound by this Plan, the Company shall
require such successor expressly and unconditionally to assume and agree to
perform the Company's obligations under this Plan, in the same manner and to
the same extent that the Company would be required to perform if no such
succession had taken place. The term "Company," as used in the Plan, shall mean
the Company as hereinbefore defined and any successor or assignee to the
business or assets which by reason hereof becomes bound by this Plan.
9
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