Exhibit 4
The FINOVA Group Inc.
1992 STOCK INCENTIVE PLAN
(INCLUDING 2000 AMENDMENTS)
Section 1. Purpose.
A. Purpose. Through this Plan, FINOVA seeks to attract,
The Plan retain and motivate officers, employees and directors.
helps align the The Plan's incentives helps align their efforts with
interest of our the profitability of the Company and increases in
executives shareholder value.
and
shareholders. B. Defined Terms. Section 11 contains a Glossary of many
defined terms used in this Plan. The Plan defines other
terms in the text as they appear.
Section 2. Administration of the Plan.
A. Committee. The Human Resources Committee of the Board
or any other committee designated by the Board (the
"Committee") will administer the Plan, unless otherwise
determined by the Board. The Committee must contain at
least two Outside Directors. Unless the Committee
contains only Outside Directors, it will appoint a
subcommittee to act on all Awards to Section 16
Officers, except as otherwise permitted by Section
162(m). Each Committee member serves at the pleasure of
the Board. If no Committee is appointed to administer
the Plan, the Board will act in its place.
The B. Powers. The Committee may grant Awards under the Plan
Committee to officers, employees and directors of the Company and
has broad its Affiliates. Among other things, and subject to the
powers to terms of the Plan, the Committee may determine in its
administer the sole discretion:
Plan.
1. The officers, employees and directors to receive
Awards, except Awards to Non-Employee Directors
can only be made as permitted by Section 7;
2. The timing and form of each Award, including
Options (ISOs or NQs), Restricted Stock (including
PBRS), Stock Appreciation Rights, or any
combination thereof;
3. The number of Shares underlying an Award;
4. The terms of any Award, including any exercise
price, vesting restriction (including vesting or
lapse of restrictions in installments),
forfeiture, expiration date, or conditions for
exercise;
5. Any performance goals or conditions to be
satisfied in connection
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with an Award, including goals based on the
performance of the individual, Company or any
Affiliate, division or department;
6. Whether and how to adjust the terms of any Award
at any time, in whole or in part, including
accelerating the vesting or exercisability,
changing the number of Shares subject to the
Award, changing the performance goals or
measurements for performance-based Awards, or
waiving or relaxing any term;
7. Whether and how to defer Shares and other amounts
payable on an Award;
8. Whether and how amounts due for any Award may be
settled in cash, Shares or otherwise;
9. Whether and how an Award may be transferred to
other persons or entities, before or after
vesting; the Committee may permit transfer of
outstanding as well as future Awards; and
10. Whether and how to cash out all or part of an
Award or its underlying Shares by paying the
holder the difference, in cash or Stock, between
the Fair Market Value over the exercise price
times the number of Shares to be cashed out.
B. Agreements/Notice of Awards. Awards will be evidenced
by written agreements, the terms and provisions of
which may differ. The Company will deliver a copy of
the agreement promptly following the grant. The Company
may sign the agreements by facsimile signature.
C. Administration of the Plan. The Committee will
supervise the administration of the Plan. It may adopt,
alter and repeal administrative rules, guidelines and
practices for the Plan. It may interpret the Plan and
the terms of any Award and related agreement.
The
Committee D. Committee Action/Delegation. The Committee may act only
may delegate by a majority of its then-current members, except it
certain matters. may: (1) delegate to one or more officers of the
Company or its Affiliates the authority to make
decisions permitted under the Plan and by law, (2)
authorize a subcommittee to act in its place if
consistent with the Plan and law, and (3) authorize one
or more of its members or officers of the Company or
any Affiliate to execute and deliver documents on
behalf of the Committee or any subcommittee. The
Committee, however, can not delegate to any officer
under (1) above decisions under the Plan with respect
to Section 16 Officers. Any other reference in this
Plan to the Committee will not preclude any delegated
authority permitted by this section.
E. Discretion to Act. The Committee and persons with
delegated authority may act in their sole discretion
when granting an Award or, if permitted by the Plan,
after the grant. All decisions made by the Committee or
under delegated authority will be binding on all
persons, including the Company and Plan participants.
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Section 3. Stock Subject to Plan.
The number of A. General Authorization. For Plan years beginning on or
initial after January 1, 1997, the Committee may continue to
authorized grant Awards for Shares in each calendar year
Shares in a (including partial years) totaling two and one-half
year generally percent (2.5%) of the Common Stock of the Company
remains the outstanding as of the first day of that year, subject
same as the to adjustment as provided in the Plan. Any available
former Plan. Shares not granted in a year will be available for
grant in a future year, but only if those Shares are
Awarded to new officers, employees or directors in
connection with the merger with or the acquisition of
all or substantially all the stock or assets of another
corporation or other entity by the Company or its
Affiliates. The Committee may award up to 500,000
shares of Preferred Stock under the Plan. The Committee
may issue Shares authorized and unissued Shares or
"treasury Shares" to satisfy any Award.
B. Limitations. Subject to adjustment as provided in the
Plan, the Committee may award a maximum of 5,000,000
shares of Common Stock as Incentive Stock Options over
the life of the Plan, and it may grant Awards for a
maximum of 1,000,000 Shares to any one participant in
any calendar year. Canceled and replacement Awards for
a participant will count against that individual award
limitation.
C. Adjustment in Amount. The Shares available under the
Plan will be increased by the number of Shares (1) of
Forfeited, unused Restricted Stock that are forfeited, (2) underlying an
or cashed-out Option (and related SAR, if any) that terminates for
Shares can be any reason without being exercised, or (3) underlying a
reused. Stock Appreciation Right that is exercised for cash.
D. Change in Corporate Structure. The Committee or Board
may adjust or substitute in its discretion the Shares
reserved for issuance under the Plan, the number and
exercise price of any outstanding Options and SARs, and
the number of Shares subject to other Awards in the
event of any change in corporate structure of the
Company. Those changes include any merger,
reorganization, consolidation, recapitalization, stock
dividend, stock split, or extraordinary distribution
regarding the Stock. The number of Shares subject to an
Award, however, must always be a whole number.
Section 4. Options.
A. Date of Grant. The grant of an Option occurs on the day
the Committee selects the person to participate in the
grant, determines the number of Shares subject to the
Option, and specifies the terms of the Option.
Options are
NQ's unless B. ISOs and NQs. The Committee may award Incentive Stock
designated as Options only to employees of the Company and its
ISO's. subsidiaries (as permitted by Section 422). The Option
agreement must note whether the Option is an ISO or NQ.
If an Option is not designated as an ISO, or even if so
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captioned it does not qualify as an ISO, it will be a
Non-Qualified Stock Option. No term of the Plan
relating to an Incentive Stock Option can be
interpreted, amended or altered, nor can any discretion
or authority granted under the Plan be exercised so as
to disqualify the Plan under Section 422 or, without
the written consent of the option holder, to disqualify
his or her ISOs under that section.
C. Terms. Options are subject to the following terms, and
such additional terms selected by the Committee:
1. Price. The Committee will state in the Option
agreement the Option price (or formula for
determining the price) per Share purchasable under
No Options that Option. The Option price must be no less than
are awarded the Fair Market Value of the Stock on the date of
at less than grant.
fair market
value or for 2. Term. All Options expire no later than 10 years
terms over 10 after the grant date.
years.
3. Method of Exercise. The Plan and Option agreement
determine when holders may exercise all or part of
their options. The holder must give the Company
written notice stating the number of Shares to be
purchased under the Option. The holder must pay
the full purchase price for the Shares purchased
at the time of exercise. The Company may determine
the permitted forms of notice and payment. The
Company will not issue any Shares until full
payment has been made.
Full payment 4. Use of Stock for Payment. If approved by the
is due on Committee, holders may pay for Options with
Option payment in full or unrestricted Stock already
exercise. owned by the holder of the same class as the Stock
subject to the Option. The Committee may permit
payment for an NQ with Restricted Stock of the
same class, based on the Fair Market Value of the
Stock on the exercise date. In that case, Shares
issued under the Option equal to the number of
Restricted Shares used will become Restricted
Shares with the same terms as the surrendered
Restricted Shares, unless the Committee determines
otherwise.
The 5. Transferability/Restrictions on Transfer. Holders
Committee may not transfer options except as permitted by
may permit the Committee or this Plan. A holder may transfer
transfer of Options by will, the laws of descent and
Awards. distribution, or under a domestic relations order
(as defined by the Code or by ERISA)
(collectively, by "Will"). Except as noted above,
all Stock Options are exercisable during the
optionee's lifetime only by the optionee or his or
her guardian or legal representative. In those
events, the term "holder," "optionee," and
"participant" include the guardian and legal
representative of the optionee and any person or
entity receiving an option by Will or permitted
transfer. The Committee cannot permit transfer of
ISOs other than by Will, unless the transfer would
not terminate ISO status.
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6. Termination of Employment. After Termination of
Employment, participants may exercise Options, to
Employees the extent then exercisable or as accelerated by
may generally the Committee, during the periods noted below,
exercise unless otherwise permitted by the Committee or the
Options after Option Agreement. In no event, however, will the
they leave Option be exercisable after expiration of the
FINOVA within original Option term. An ISO exercised after the
the following exercise periods permitted by the Code will be
periods: treated as an NQ.
Death - 1 year (a) Death. One year from the date of death. If
Disability - 3 the optionee dies after Termination of
years Employment during the periods referenced in
Retirement - 3 Section 4.C.6(b), that period will be
years extended to the extent necessary to permit
Termination exercise within one year from the date of
for Cause - death.
Options expire
Other reasons (b) Disability or Retirement. Three years from
- - 3 months the Termination of Employment due to
Disability or Retirement.
(c) Terminations for Cause. The Option will
terminate and will not be exercisable.
"Cause" means (i) conviction of a felony,
(ii) dishonesty in fulfilling one's
employment duties or (iii) willful and
deliberate failure to perform those duties in
any material respect.
(d) Terminations Not for Cause, Death, Disability
or Retirement. Three months from the
Termination of Employment.
7. Cash Out for Change in Control. During the first
60 days after a Change in Control (the "Exercise
Period"), an optionee may elect, by written notice
to the Company, to be paid in cash the Spread for
each Share underlying his or her outstanding
Options, even if not then exercisable, in lieu of
payment of the exercise price for the Options. The
payment will be made within 30 days of that
notice. The rights under this Section 4.C.7
supersede all other provisions of the Plan, but
will not exist if the Committee states that at the
time of the grant. The "Spread" is the amount the
Change in Control Price per Share on the date of
election exceeds the exercise price per Share.
Section 16 Officers may not make the election
provided for by this paragraph for Options granted
within 6 months of a Change in Control. In that
case, the Options will automatically be canceled
in exchange for a cash payment equal to the Spread
multiplied by the number of Shares underlying the
Options. That payment will be made on the day that
is 6 months and 1 day after the grant of the
Options.
8. Rights as a Shareholder. The holder of an Option
will have all the rights of a shareholder of the
Company for that class or series of Stock
(including, if applicable, the right to vote the
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securities and the right to receive dividends)
when the holder gives written notice of exercise,
pays for the Shares and, if requested, gives the
representation described in Section 10.A.
Section 5. Stock Appreciation Rights.
A. Grant and Exercise. The Committee may grant Stock
Appreciation Rights with all or part of any Option
Award, either at or after the grant (at the time of
grant only for ISOs). A Stock Appreciation Right will
terminate and not be exercisable on the termination or
exercise of the related Option, and vice versa. To
exercise an SAR, the holder must surrender the
applicable part of the related Option and comply with
procedures established by the Committee.
B. Terms. Stock Appreciation Rights are subject to the
following terms, and any additional terms selected by
the Committee:
1. Same as Options. SARs are exercisable only at the
times and to the extent the related Options are
exercisable.
Exercise of an
SAR cancels 2. Payment for SARs. Upon exercise of an SAR, an
the underlying optionee the Company will pay cash, Shares or both
Option and equal to the amount the Fair Market Value of each
vice versa. Share exceeds the Option price of the related
Option, multiplied by the number of Shares for
which the SAR is exercised. The Committee will
determine the form of payment.
3. Transferability of SARs. Holders may transfer SARs
only to the extent permitted for the underlying
Option.
4. Cash Out for Change in Control. The provisions of
Section 4.C.7 also apply to SARs.
Section 6. Restricted Stock.
A. Section 16 Officers. Unless otherwise provided by the
Committee, awards of Restricted Stock to Section 16
PBRS Awards Officers will only be PBRS Awards which comply with the
can base performance-based compensation requirements of Section
performance 162(m). Unless otherwise determined by the Committee,
on various the performance goals for the PBRS Awards will be based
factors. on the following factors: total shareholder return
(alone or in comparison with one or more indices),
revenues (gross or net), earnings per share, expenses,
margin (gross or net), changes in stock price, funds or
asset turnover, market share, net income (before or
after taxes), return on assets, equity, capital,
investment, or sales (actual or pro forma), operating
margin, net revenue growth, or cash flow. The Committee
may decline to use any or all of those performance
goals and it may apply these performance measures
singly or in any combination. It may also link them to
performance of the Company, its Affiliates or any
division, department or individual. The Committee may
not forgive satisfaction of
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any performance condition specified for officers
subject to Section 162(m), nor may it increase an Award
to those officers over amounts provided for by the
initial grant, unless permitted by Section 162(m). The
Committee must certify attainment of the performance
results if required by Section 162(m).
B. Awards and Certificates. The Committee may determine
the form Restricted Stock may take, including
book-entry registration or issuance of one or more
stock certificates. Restricted Stock will be registered
in the name of the participant. Restricted Stock
certificates will bear an appropriate legend referring
to the restrictions on that Award. The legend will read
essentially:
The transferability of this certificate and the
shares of stock represented hereby are subject to
the terms (including forfeiture) of the 1992 Stock
Incentive Plan and a Restricted Stock Agreement.
Copies of the Plan and Agreement are on file at
the offices of The FINOVA Group Inc.
The Company's most recent principal address will also
be included in the legend, but the failure to update
the address in the event of a change will have no
effect on the restrictions on those Shares. The Company
will hold any certificates evidencing Restricted Stock
until the restrictions lapse, unless otherwise
determined by the Committee. The Committee may also
require, as a condition to an Award, that the
participant deliver one or more stock powers and, if
appropriate, SEC Forms 144 or other applicable forms,
executed in blank, relating to the Restricted Stock.
C. Terms. Restricted Stock is subject to the following
terms and any other terms selected by the Committee:
1. No Transfer. Except as permitted by the Plan,
Committee or Restricted Stock agreement, the
participant may not transfer, sell, assign, pledge
or otherwise encumber the Restricted Stock during
the period set by the Committee beginning on the
date of the Award (the "Restriction Period").
2. Rights as a Shareholder. Except as provided by the
Plan, Committee or Restricted Stock agreement, the
Restricted Stock participant will have all the rights of a
can not be shareholder for the same class or series of Stock
transferred as the Restricted Stock, including, if applicable,
during the the right to vote the Shares and to receive any
Restriction cash dividends. If the Committee requires in the
Period, with Restricted Stock agreement, and subject to Section
limited 10.F, (a) cash dividends on the Restricted Stock
exceptions. will be automatically deferred and reinvested in
additional Restricted Stock, and (b) Stock
dividends will be paid in the form of Restricted
Stock of the same class as the dividend.
3. Forfeiture of Restricted Stock. Except as provided
by this Plan, the Committee or the Restricted
Stock agreement, a participant will forfeit all
Shares of Restricted Stock still subject to
restriction upon his or her Termination of
Employment.
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4. Certificates Upon Vesting. Upon expiration of the
Restriction Period without a prior forfeiture, the
Company will deliver unlegended certificates for
those Shares to the participant.
Section 7. Non-Employee Director Awards.
A. Automatic Grants. Each Non-Employee Director who has
served on the Board continuously since the commencement
Non-Employee of his or her term will receive an annual (including
Directors receive partial years) grant of Non-Qualified Options to
Options for 4,000 purchase 3,000 Shares of Common Stock. The grant will
Shares on occur automatically on the third Thursday of August
election and during that director's term. Each Non-Employee Director
3,000 Shares each will also be awarded NQs to purchase 4,000 shares of
year of service. Common Stock on joining the Board. The exercise price
for those grants will equal the Fair Market Value on
the date of grant.
B. Election for Retainer Payments. In addition to the
Awards authorized by Section 7.A, each Non-Employee
Director may from time to time elect to receive, in
lieu of all or part of the cash retainer otherwise
payable to that director, (1) Restricted Stock
("Directors Retainer Shares") with a Fair Market Value
Directors may equal to the amount of the retainer payment to be paid
elect to receive on that date, (2) Non-Qualified Options to purchase
all or part of Common Stock with a Fair Market Value as of that
their annual payment date equal to two and one-half times the amount
retainer in of the retainer payment ("Directors Retainer Options"),
Restricted Stock or (3) a combination of the above. The Committee may
or Options. establish minimum thresholds for election of any
alternative other than cash.
C. Directors Retainer Shares. Except as permitted by the
Plan, Committee or Restricted Stock Agreement,
Directors may not transfer Retainer Shares until the
day before the next annual meeting of the Company's
shareholders. Those Shares will be forfeited to the
Company if the director ceases to be a Board member
prior to that date except as otherwise provided by this
Plan.
D. Directors Retainer Options. Except as provided below,
Directors Retainer Options may be exercised in whole or
in part commencing on the day before the next annual
meeting of shareholders and ending ten years after the
date of grant. If the director ceases to be a Board
member before the Directors Retainer Option becomes
exercisable, the Option becomes void, except as
provided by this Plan. The exercise price will be the
Fair Market Value of the Shares on the date of grant.
E. Death, Disability or Retirement of a Director. If a
participant ceases to be a Board member due to death,
Disability or Retirement as a director at the end of a
term or upon a Change in Control, then any Directors
Retainer Shares and Directors Retainer Options will
immediately vest and become exercisable, as the case
may be. Any restriction on transfer imposed by this
Plan and any risk of forfeiture will cease on any of
those events.
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F. Expiration of Directors Retainer Options. Directors
Retainer Options that are exercisable but have not been
exercised expire six months after the date the director
ceases to be a Board member, except as noted below. If
the Board membership ceases due to death, Disability or
Retirement as a director at the end of a term, those
Options may be exercised for two years after
termination of Board membership, and if the director
dies within the six month or two year periods noted
above, the Options may be exercised at any time within
two years after the death. Nothing in this paragraph
permits exercise of any Options beyond the original ten
year term.
G. Allocation of Shares. If the number of Shares available
for future grants under the Plan is not sufficient to
make all automatic grants required to be made on that
date, then all Non-Employee Directors entitled to a
grant on that date will share proportionately in the
available Options. In addition, no elections under
Section 7.B can be made until all automatic grants for
that date have been made, and the directors who have
elected to receive all or any portion of their retainer
under that subsection will share ratably in the number
of remaining available Shares.
H. Other Terms. Except as expressly provided in this
Section 7, any Award granted under this Section will be
subject to the terms of the Plan, including those
contained in Sections 4, 6 and 8, as appropriate.
Section 8. Change in Control Provisions.
A. Impact of Event. Notwithstanding any other provision in
this Plan to the contrary, if a Change of Control
occurs:
Awards vest and 1. Options and SARs. Any unvested or unexercisable
can be exercised Options and SARs outstanding as of the date of the
if a Change in Change in Control become fully vested and
Control occurs. exercisable to the full extent of the original
grant, without regard to the three month limit on
exercisability imposed by Section 4.C.6(d) of the
Plan.
2. Restricted Stock. The restrictions on Restricted
Stock lapse, and it will become free of all
restrictions (other than those imposed by the
securities laws). The Restricted Stock will fully
vest immediately, including full vesting of the
maximum number of Shares or payouts as if maximum
performance conditions or goals were achieved, as
applicable.
B. Definition of Change in Control. For purposes of the
Plan, a "Change in Control" means the happening of any
of the following events:
1. Acquisition. An acquisition by any person, entity
or group (within the meaning of Section 13(d)(3)
or 14(d)(2) of the Exchange Act (a "Person") of
beneficial ownership (within the meaning of SEC
Rule 13d-3) of 20% or more of either (a) the
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then outstanding common stock (the "Outstanding
Common Stock") or (b) the combined voting power of
the then outstanding voting securities entitled to
vote generally in the election of directors (the
"Outstanding Voting Securities") of the Company.
Exception. No Change of Control will have occurred
for any acquisition (i) directly from the Company
or any Affiliate, other than one by exercise of a
conversion privilege unless the security being so
converted was itself acquired directly from the
Company or Affiliate, (ii) by the Company or any
Affiliate, (iii) by any employee benefit plan or
related trust sponsored or maintained by the
Company or any Affiliate, or (iv) by any
corporation pursuant to a transaction that
complies with clauses (a), (b) and (c) of the
Exception contained in subsection 3 of this
Section 8.B; or
2. Change in the Board. A change in the composition
of the Board so that the members who as of January
1, 1997 constitute the Board (the "Incumbent
Board") cease for any reason to be at least a
majority of the Board. Any person who becomes a
Board member after January 1, 1997 whose election
or nomination for election was approved by at
least a majority of the Incumbent Board will also
be a member of the Incumbent Board, unless his or
her initial assumption of office occurs due to
either an actual or threatened election contest
(as those terms are used in SEC Rule 14a-11 or SEC
Regulation 14A) or other actual or threatened
solicitation of proxies or consents by or on
behalf of a Person other than the Board; or
3. Corporate Transaction. The Company's shareholders
approve a reorganization, merger, consolidation or
sale or other disposition of all or substantially
all the assets of the Company (a "Corporate
Transaction").
Exception. If all of the following apply, the
instance will not be a Corporate Transaction: (a)
all or substantially all of the beneficial owners
of the Company's Outstanding Common Stock or
Outstanding Voting Securities, respectively,
immediately prior to the Corporate Transaction
will beneficially own, directly or indirectly,
more than 60% of, respectively, the Outstanding
Common Stock and the Outstanding Voting Securities
of the corporation resulting from the Corporate
Transaction (including any corporation that owns
the Company or all or substantially all of the
Company's assets directly or indirectly) in
substantially the same proportions as their
ownership immediately prior to the Corporate
Transaction, (b) no Person (other than the
Company, any employee benefit plan -- or related
trust -- of the Company or the corporation
resulting from the Corporate Transaction) will
beneficially own, directly or indirectly, 20% or
more of the Outstanding Common Stock or
Outstanding Voting Securities, except to the
extent that ownership existed prior to the
Corporate
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Transaction, and (c) members of the Incumbent
Board constitute at least a majority of the board
of directors resulting from the Corporate
Transaction, or
4. Liquidation/Dissolution of the Company. The
shareholders of the Company approve a complete
liquidation or dissolution of the Company.
C. Change in Control Price. For purposes of this Plan,
"Change in Control Price" means the higher of (1) the
highest reported sales price, regular way, of a Share
in any transaction reported on the NYSE Composite Tape,
on any other national exchange listing the Shares or on
NASDAQ during the 60 days ending on the date of the
Change in Control or (2) if the Change in Control
results from a tender or exchange offer or a Corporate
Transaction, the highest price per Share paid in that
tender or exchange offer or Corporate Transaction. For
Incentive Stock Options and Stock Appreciation Rights
relating to ISOs, the Change in Control Price will be
in all cases the Fair Market Value of the Stock on the
date the ISO or SAR is cashed out. To the extent the
consideration paid in any Change in Control transaction
consists of all or in part securities or other non-cash
consideration, the Board will determine the value of
the securities or non-cash consideration in its
discretion.
Section 9. Effective Date/Term/Amendment/Termination.
A. Effective Date. This amended Plan is effective upon
approval by the Board. Those changes necessary for
The Board may qualification under Section 162(m) or Section 422 will
amend the Plan not be effective until those changes are ratified and
but may not approved by a majority of the Company's shareholders
adversely impact who vote on the matter at a meeting with a quorum
existing Awards, present. All Awards outstanding on the effective date
with certain of these amendments to this Plan will remain
exceptions. outstanding and will become subject to the terms of
this Plan as amended.
B. Termination. The Plan terminates on December 31, 2002.
Awards outstanding as of the date the Plan terminates
will not be affected or impaired by that termination.
C. Changes to the Plan/Restrictions. The Board may amend,
alter or discontinue the Plan, including to incorporate
changes in law, tax and accounting rules, or other
developments, and to grant Awards that qualify for
beneficial treatment under those changes. No change can
be made, however, that would (1) impair the rights of a
participant granted before that date without the
participant's consent, except for a change made to
cause the Plan to qualify for exemptions provided by
then-current law, including exemptions relating to
securities and taxation, or (2) disqualify the Plan
from the exemptions provided by SEC Rule 16b-3 or for
favorable tax treatment under Sections 162(m) or 422.
No amendment
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can be made without approval of the Company's
shareholders if their approval is required by law or is
necessary to maintain the exemptions under Rule 16b-3
or Sections 162(m) or 422. No term of the Plan can be
interpreted, amended or altered, nor can any discretion
or authority to act under the Plan be exercised so as
to disqualify the Plan under Sections 162(m) or 422 or
Rule 16b-3.
D. Changes to Prior Awards/Restrictions. The Committee may
amend the terms of any Award granted before that date,
prospectively or retroactively, but no amendment can
impair the rights of any holder without the holder's
consent, except as noted in this Section 9. The
Committee may also substitute new Options for
previously granted Options, including previously
granted Options having higher exercise prices.
Section 10. General Provisions.
A. No Intent to Transfer. The Committee may require each
person acquiring an Award or the underlying Shares to
represent to and agree with the Company in writing that
the person is acquiring the Award or Shares without a
view to the distribution thereof. All Shares or other
securities issued under the Plan will be subject to
stop transfer orders and other restrictions imposed by
the Committee, including restrictions imposed by law,
SEC or stock exchange rules or other restrictions. The
certificates for Shares or other Awards may contain any
legend the Committee deems appropriate regarding any
restrictions on transfer or otherwise.
B. Other Compensation Permitted. Nothing in this Plan will
prevent the Company or any Affiliate from adopting
other or additional compensation arrangements for their
employees.
C. No Employment Rights. Nothing in this Plan or any Award
will confer on any employee any right to continued
employment, nor will either interfere with the right of
the Company or any Affiliate to terminate the
employment of any employee at any time.
D. Taxes. The participant must pay to the Company or make
arrangements satisfactory to the Company regarding the
payment of any Federal, state, local and foreign taxes
of any kind required by law to be withheld regarding
any Award. The participant must satisfy that tax
obligation no later than when the amount becomes
Holders must includible in the person's gross income for Federal
pay taxes due income tax purposes. Unless otherwise determined by the
on Awards. Company, withholding obligations may be settled with
Stock, including Stock that is part of the Award giving
rise to the tax obligation. The obligations of the
Company under the Plan are conditional on satisfaction
of these taxes. The Company and its Affiliates may
deduct any taxes due from any payment otherwise due the
participant if permitted by law.
E. Right of First Refusal. At the time of grant, the
Committee may require
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that the participant offer to the Company the right to
purchase Shares resulting from an Award (or if the
Committee permits transfer, of the Award itself) that
the participant wishes to sell, transfer, assign,
pledge or otherwise encumber. The Company will have the
right to purchase the Shares (or Award) at the then
Fair Market Value of the Shares, subject to terms the
Committee specifies at the time of grant.
F. Reinvestment of Dividends Subject to Availability. The
reinvestment of dividends in additional Restricted
Stock can only occur if sufficient Shares are available
under Section 3 for that reinvestment (taking into
account then outstanding Awards).
G. Beneficiary Designation. The Committee will establish
procedures for a participant to designate a beneficiary
to whom any amounts payable in the event of the
participant's death are to be paid.
H. Governing Law. The Plan and all Awards made and actions
taken under the Plan will be governed by and construed
in accordance with the laws of the State of Delaware,
without regard to its conflicts of law principles.
I. Unfunded Status of Plan. The Board intends that the
Plan constitute an "unfunded" plan for incentive and
deferred compensation. The Committee may create trusts
or other arrangements to meet the obligations created
under the Plan to deliver Stock or make payments.
Unless the Committee otherwise determines, however, the
existence of those trusts or arrangements shall be
consistent with the unfunded status of the Plan.
Section 11. Definitions.
As used in this Plan:
"Affiliate" means a corporation or other entity controlled
by the Company and designated by the Committee as eligible
to participate in this Plan.
"Award" means an Option, Stock Appreciation Right or
Restricted Stock grant issued under the Plan.
"Board" means the Board of Directors of the Company.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor provisions. The Code includes its related
rules.
"Committee" is defined in Section 2.A.
"Common Stock" means the common stock, par value $.01 per
share, of the Company.
"Company" or "FINOVA" means The FINOVA Group Inc., a
Delaware corporation.
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"Disability" means permanent and total disability under the
Company's policies as they then exist. The Committee may
amend or interpret, for purposes of the Plan, the Company's
disability policies in its discretion.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and any successor provisions. The Exchange Act
includes its related rules, as they may be amended.
"Fair Market Value" as of any given date depends on whether
the Stock is immediately resold. The resale price is the
fair market value if the participant resells that Stock in
an arms-length transaction on the open market on the same
date the Fair Market Value is to be determined. In all other
cases, the Fair Market Value is the average of the high and
low reported sales prices of the Stock on the given date.
The reported sales price will be determined in the following
order, as applicable: the NYSE Composite Tape, any other
national stock exchange listing the stock, NASDAQ, or if the
Stock's sales are not regularly reported by any of the
above, by the Committee in its good faith discretion. For
any day that is not a trading day on the national securities
markets, the previous trading day will determine Fair Market
Value.
"Incentive Stock Option" or "ISO" means any Option intended
to be and designated as an "incentive stock option" within
the meaning of Section 422 of the Code.
"Including" even if not capitalized, means including without
limitation.
"Non-Employee Director" means a director who is not
otherwise an employee of the Company or any Affiliate and
has not been so employed for any part of the preceding
fiscal year.
"Non-Qualified Option" or "NQ" means any Option that is not
an ISO.
"Option" means an option granted under Section 4 or 7.
"Outside Director" means a director who satisfies the
requirements of an "outside director" as defined in Section
162(m) and who otherwise satisfies the requirements of a
"non-employee director" under Rule 16b-3.
"Plan" means this 1992 Stock Incentive Plan, as it may be
amended.
"Performance Based Restricted Stock" or "PBRS" means
Restricted Stock with performance conditions other than the
mere passage of time or continued employment or service
which satisfy the requirements as performance-based
compensation under Section 162(m).
"Preferred Stock" means preferred stock, par value $.01, of
the Company.
"Restricted Stock" means an Award granted under Section 6 or
7.C.
"Retirement" means (A) retirement from active employment as
defined in a pension plan of the Company or an Affiliate,
(B) retirement under an employment contract
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with the Company or an Affiliate, or (C) termination of
employment (or service as a non-employee director) at or
after age 55 under circumstances that the Committee in its
sole discretion deems to be retirement.
"SEC" means the Securities and Exchange Commission or any
successor.
"Section 16 Officer" means any officer (including any
employee director) subject to the insider trading and
reporting requirements of Section 16 of the Exchange Act.
Non-Employee Directors are not Section 16 Officers for
purposes of this Plan.
"Section 162(m)" means Section 162(m) of the Code.
"Section 422" means Section 422 of the Code.
"Shares" or "Stock" means the Common Stock or Preferred
Stock, as the case may be.
"Stock Appreciation Right" or "SAR" means a right granted
under Section 5.
"Termination of Employment" means the termination of the
participant's employment with the Company or an Affiliate.
It also occurs if the participant is employed by a division,
department or Affiliate that ceases its affiliation with the
Company. In any case, the participant will not incur a
Termination of Employment if he or she immediately becomes
an employee of the Company or another Affiliate following
that event.
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