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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. 1)*
Gibralter Packaging Group, Inc.
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(Name of Issuer)
Common Stock, $0.01 Par Value
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(Title of Class of Securities)
374-758-10-0
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(CUSIP Number)
Marc C. Krantz, Kohrman Jackson & Krantz P.L.L.,
1375 East 9th Street, Cleveland, Ohio 44114, 216-736-7204
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
December 3, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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<TABLE>
SCHEDULE 13D
CUSIP NO. 374-758-1-0
<S> <C>
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1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Walter E. Rose
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS*
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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NUMBER OF 7 SOLE VOTING POWER
SHARES 331,296
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BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
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EACH 9 SOLE DISPOSITIVE POWER
REPORTING 331,296
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PERSON 10 SHARED DISPOSITIVE POWER
WITH
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
331,296
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.5%
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14 TYPE OF REPORTING PERSON*
IN
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</TABLE>
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CUSIP No. 374-758-10-0
This Amendment No. 1 to Schedule 13D Statement is filed on behalf of
Walter E. Rose for the purpose of reporting the vesting of certain options
("Options") granted to Mr. Rose for the purchase of shares of common stock, par
value $0.01 per share, of Gibraltar Packaging Group, Inc., a Delaware
corporation.
Item 1. Security and Issuer.
Item 1 is amended and supplemented as follows:
This Amendment No. 1 to Schedule 13D Statement is filed on behalf of
Walter E. Rose and relates to the shares of common stock, par value $0.01 per
share (the "Shares"), of Gibraltar Packaging Group, Inc., a Delaware
corporation, that has its principal executive offices at 274 Riverside Avenue,
Westport Connecticut, 06880 ("Gibraltar").
Item 2. Identity and Background.
Item 2 is amended and supplemented as follows:
(a) This Amendment No. 1 to Schedule 13D Statement is filed on behalf of
Walter E. Rose.
(b) Mr. Rose's business address is 274 Riverside Avenue, Westport
Connecticut, 06880.
(c) Mr. Rose's principal occupation is President and Chief Executive
Officer of Gibraltar.
(d) Negative with respect to Mr. Rose.
(e) Negative with respect to Mr. Rose.
(f) Mr. Rose is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
Item 3 is amended and supplemented as follows:
The Options reported herein as having vested were granted to Mr. Rose as
compensation for services rendered by Mr. Rose to Gibraltar. The Stock Option
Agreement (the "Option Agreement") and Gibraltar's 1996 Non-Qualified Stock
Option Plan (the "Plan") pursuant to which the Options were granted to Mr. Rose
are attached hereto, as Exhibits 7.2 and 7.3, respectively. Should Mr. Rose
elect to exercise the Options when they vest in accordance with the Option
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CUSIP No. 374-758-10-0
Agreement, he will be required to purchase the Shares for a purchase price of
$4.00 per share.
Item 5. Interest in Securities of the Issuer.
Item 5 is amended and supplemented as follows:
(a) According to the most recently available filing with the Securities
and Exchange Commission (the "Commission") by Gibraltar, there would be
5,066,544 Shares outstanding if Mr. Rose exercised the Options reported herein
as vesting on February 1, 1997 ("Outstanding Shares").
Mr. Rose beneficially owns 331,296 Shares, or approximately 6.5% of
the Outstanding Shares, which is the sum of the 306,296 Shares owned by him and
the 25,000 Shares that Mr. Rose has the unconditional right to purchase on
February 1, 1997, in accordance with the terms of the Option Agreement. Under
Rule 13d(1)(i) promulgated by the Commission under the Securities Exchange Act
of 1934, as amended, Mr. Rose may be deemed to have beneficial ownership of the
25,000 Shares because he has the unconditional right to acquire such Shares in
60 days pursuant to the terms of the Option Agreement.
(b) Mr. Rose has sole power to vote, or to direct the voting of, and the
sole power to dispose or to direct the disposition of, the Shares owned by him.
(c) The only transaction in the Shares by Mr. Rose in the last 60 days
occurred because, as of December 3, 1996, under Rule 13d(1)(i), Mr. Rose may be
deemed to have beneficial ownership of the 25,000 Shares he has the
unconditional right to acquire on February 1, 1997 pursuant to the terms of the
Option Agreement.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Item 6 is amended and supplemented as follows:
Gibraltar granted Mr. Rose Options to purchase 125,000 Shares for an
exercise price of $4.00 per Share, on the terms and conditions set forth in the
Option Agreement and the Plan. The Options vest in accordance with the Option
Agreement as follows:
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CUSIP No. 374-758-10-0
<TABLE>
Date Shares
May be Purchased Number of Shares
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<S> <C>
February 1, 1997 25,000
August 1, 1997 25,000
August 1, 1998 25,000
August 1, 1999 25,000
August 1, 2000 25,000
</TABLE>
In accordance with the Option Agreement, the Options otherwise vesting on
August 1, 1997, August 1, 1998, August 1, 1999 and August 1, 2000 will not vest
unless and until at any time prior to the expiration of the Options, the per
Share fair market value (as such term is defined in the Option Agreement) is,
for a period of at least 20 consecutive trading days, equal to $6.00, $7.00,
$8.00 and $9.00, respectively. The Option Agreement and the Plan are attached
hereto as Exhibit 7.2 and 7.3, respectively.
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CUSIP No. 374-758-10-0
Item 7. Material to be Filed as Exhibits.
Item 7 is amended and supplemented as follows:
7.2 -- Stock Option Agreement
7.3 -- Gibraltar 1996 Non-Qualified Stock Option Plan
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CUSIP No. 374-758-10-0
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: December 30, 1996 /s/ Walter E. Rose
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Walter E. Rose
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CUSIP No. 419-411-10-3
Exhibit Index
7.2 -- Stock Option Agreement
7.3 -- Gibraltar 1996 Non-Qualified Stock Option Plan
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EXHIBIT 7.2
GIBRALTAR PACKAGING GROUP, INC.
STOCK OPTION AGREEMENT
This Agreement, effective as of August 1, 1996 (the "Grant Date"), is by
and among GIBRALTAR PACKAGING GROUP, INC., a Delaware corporation (the
"Company"), and WALTER E. ROSE ("Optionee").
To carry out the purposes of the Gibraltar Packaging Group, Inc. 1996
Non-Qualified Stock Option Plan ("Plan") by affording Optionee the opportunity
to purchase shares of Common Stock, par value $0.01 per share, of the Company
("Stock"), and in consideration of the mutual agreements and other matters set
forth herein and in the Plan, the Company and Optionee hereby agree as follows:
1. Grant of Option. The Company hereby grants to Optionee the right and
option (the "Option") to purchase all or any part of an aggregate of 125,000
shares of Stock, on the terms and conditions set forth herein and in the Plan.
2. Purchase Price. The purchase price of Stock purchased upon exercise
of the Option shall be $4.00 per share.
3. Exercise of Option.
(a) Subject to the earlier expiration of the Option as herein provided
and subject to the terms and conditions contained herein, the Option may be
exercised, by written notice to the Company at its principal executive office,
addressed to the attention of the Secretary of the Company, at any time and
from time to time on and after the Grant Date, subject to the vesting schedule
set forth below, such exercise to be effective at the time of receipt of such
written notice at the Company's principal executive office during normal
business hours; provided, however, that, except (i) any exercise of the Option
must be for a minimum of 500 shares of Stock and (ii) the Option shall only be
exercisable in accordance with the following vesting schedule subject to
Paragraphs 3(b) and 3(c):
<TABLE>
Date Shares of Stock
May be Purchased Percentage of Shares of Stock
-------------------------- -----------------------------
<S> <C>
Six months from Grant Date 20%
1 year from Grant Date 20%
2 years from Grant Date 20%
3 years from Grant Date 20%
4 years from Grant Date 20%
</TABLE>
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(b) Notwithstanding Paragraph 3(a) above, (i) the portion of the Option
that would otherwise vest on the date that is one year from the Grant Date
shall not be vested unless and until at any time prior to the expiration of
this Option the "Fair Market Value" (as defined below) of the Stock is equal to
or greater than $6.00 for 20 consecutive trading days; (ii) the portion of the
Option that would otherwise vest on the date that is two years from the Grant
Date shall not be vested unless and until at any time prior to the expiration
of this Option the Fair Market Value of the Stock is equal to or greater than
$7.00 for 20 consecutive trading days; (iii) the portion of the Option that
would otherwise vest on the date that is three years from the Grant Date shall
not be vested unless and until at any time prior to the expiration of this
Option the Fair Market Value of the Stock is equal to or greater than $8.00 for
20 consecutive trading days; and (iv) the portion of the Option that would
otherwise vest on the date that is four years from the Grant Date shall not be
vested unless and until at any time prior to the expiration of this Option the
Fair Market Value of the Stock is equal to or greater than $9.00 for 20
consecutive trading days. "Fair Market Value" means (i) if the Stock is
listed on a domestic securities exchange or admitted to unlisted trading
privileges on such exchange or listed for trading on the National Association
of Securities Dealers automated quotation system ("NASDAQ"), the last reported
sale price of a share of Stock on such exchange or NASDAQ, or if no such sale
is made any such day, the average closing bid and asked prices for any such day
on such exchange or NASDAQ; or (ii) if the Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are not so reported,
the price per share as determined by the board of directors of the Company
acting in good faith.
For example purposes only, if the Fair Market Value of the Stock does not
reach $6.00 on 20 consecutive trading days prior to the date that is one year
from the Grant Date, the portion of the Option that would otherwise vest on
that date will not vest on that date. If the Fair Market Value of the Stock
subsequently is equal to or greater than $6.00 for 20 consecutive trading days
at any time prior to the expiration of this Option, such portion of the Option
will vest on the 20th day.
(c) The Option shall become immediately fully exercisable:
(i) if there occurs any transaction (which shall include a series of
transactions occurring within 60 days or occurring pursuant to a plan), that
has the result that stockholders of the Company immediately before such
transaction cease to own at least 51% of the voting stock of the Company or of
any entity that results from the participation of the Company in a
reorganization, consolidation, merger, liquidation or any other form of
corporate transaction;
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(ii) if the stockholders of the Company approve a plan of merger,
consolidation, reorganization, liquidation or dissolution in which the Company
does not survive (unless the approved merger, consolidation, reorganization,
liquidation or dissolution is subsequently abandoned); or
(iii) if the stockholders of the Company approve a plan for the sale,
lease, exchange, transfer, assignment or other disposition of all or
substantially all the property and assets of the Company (unless such plan is
subsequently abandoned).
(d) Optionee (or the person permitted to exercise the Option in the event
of Optionee's death) shall be and have all of the rights and privileges of a
stockholder of record of the Company with respect to shares acquired upon
exercise of the Option, effective upon such exercise.
4. Payment of Exercise Price. The purchase price of shares as to which
the Option is exercised shall be payable at the time of exercise (i) in cash or
check payable and acceptable to the Company, or (ii) by the Optionee
delivering to the Company a properly executed exercise notice together with
irrevocable instructions to a broker to promptly deliver to the Company cash or
a check payable and acceptable to the Company to pay the Option exercise price;
provided that in the event the Optionee chooses to pay the Option exercise
price as provided in clause (ii), the Optionee and the broker shall comply with
such procedures and enter into such agreements of indemnity and other
agreements as the Committee shall prescribe as a condition of such payment
procedure.
5. Transferability. The Option may be sold, exchanged, pledged,
transferred, assigned or otherwise encumbered by Optionee only as follows: (1)
to the spouse or any children or grandchildren of Optionee; (2) as a charitable
contribution or gift to or for the use of any person or entity described in
Section 170(c) of the Internal Revenue Code of 1986, as amended; (3) to any
"Controlled Entity," as such term is defined below; or (4) by will or the laws
of intestate succession. "Controlled Entity" means any trust, partnership,
limited liability company or other entity in which Optionee acts as trustee,
managing partner, managing member or otherwise controls.
6. Termination of Employment. If the Optionee's employment is
terminated for any reason other than a Qualified Termination (defined below),
the Option shall automatically expire simultaneously with such termination. In
the event of termination of an Optionee's employment due to death, retirement
on or after reaching age 65 (or if prior to age 65, with the consent of the
Committee), permanent disability (as determined under the standards of the
Company's long-term disability program) or termination by the Company for any
reason other than "cause" (such four events being a "Qualified Termination"),
the Option may be exercised by the Optionee (or his estate, personal
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representative or beneficiary) at any time within the three-month period
commencing on the day next following such Qualified Termination (or within the
next succeeding three months if the Optionee dies or becomes disabled within
the three-month period following such Qualified Termination) to the full extent
that the Optionee was entitled to exercise the same on the day immediately
prior to such Qualified Termination. For purposes of this clause, "cause"
shall mean:
(i) Final conviction of the Optionee of a felony under the laws of
the United States or any state thereof which results or was intended to result
directly or indirectly in gain or personal enrichment by the Optionee at the
expense of the Company;
(ii) Participation by the Optionee as an employee, officer or
principal shareholder in any business engaged in activities in direct
competition with the Company without the consent of the Company; or
(iii) Gross and willful inattention to Optionee's duties as an
employee for a continuous period of three months other than due to Optionee's
total physical disability, or another cause reasonably beyond the control of
Optionee, which inattention to duty has a material adverse effect on the
Company.
7. Withholding of Tax. To the extent that the exercise of the Option is
a taxable event with respect to which the Company has a duty to withhold for
federal or state income tax purposes, Optionee shall pay to the Company at the
time of such exercise (or such other time as the law permits if Optionee is
subject to Section 16(b) of the Securities Exchange Act of 1934) such amount of
money as the Company may require to meet its obligation under applicable tax
laws or regulations (or to be entitled to a tax deduction), and, if Optionee
fails to do so, the Company is authorized to withhold from any cash
remuneration then or thereafter payable to Optionee any tax required to be
withheld by reason of such resulting compensation income (or to be entitled to
a tax deduction) or otherwise refuse to issue or transfer any shares otherwise
required to be issued pursuant to the terms hereof.
8. Status of Stock. Unless the offering, sale and delivery of shares of
Stock acquirable upon exercise of the Option have been registered and continue
to be so at the date of exercise hereof under the Securities Act of 1933 (the
"Act"), Optionee agrees that the shares of Stock which Optionee acquires by
exercise the Option shall be acquired for investment without a view to
distribution, within the meaning of the Act, and shall not be sold,
transferred, assigned, pledged or hypothecated in the absence of an effective
registration statement for the shares under the Act and applicable state
securities laws or an applicable exemption from the registration requirements
of the act and any applicable state securities laws. Optionee also agrees that
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the shares of Stock which Optionee may acquire by exercising the Option will
not be sold or disposed of in any manner which would constitute a violation of
any other applicable securities law, whether federal or state.
In addition, Optionee agrees (a) that the certificates representing
the shares of Stock issued under this Agreement may bear such legend or legends
as the Committee deems appropriate in order to assure compliance with
applicable securities laws, and (b) that the Company may give instruction to
its transfer agent, if any, to stop transfer of the shares of Stock issued
under this Agreement on the stock transfer records of the Company, if such
proposed transfer would in the opinion of counsel satisfactory to the Company
constitute a violation of any applicable securities law or any such agreements.
Optionee further agrees that the Option granted herein shall be
subject to the requirement that, if at any time the Board of Directors shall
determine, in its discretion, that the listing, registration or qualification
of the shares subject to such Option upon any securities exchange or under any
state or federal law, or the consent or approval of any governmental regulatory
body, is necessary or desirable as a condition of, or in connection with, the
issue or purchase or issuance of shares hereunder, such Option may not be
exercised in whole or in part unless such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not reasonably acceptable to the Board of Directors.
9. Employment Relationship. For purposes of this Agreement, Optionee
shall be considered to be in the employment of the Company as long as Optionee
remains an employee of either the Company or its Subsidiaries (as defined in
the Plan). Any question as to whether and when there has been a termination of
such employment, for purposes of this Agreement, and the cause of such
termination, for purposes of this Agreement, shall be determined by the
Committee, and its determination shall be final. Nothing herein shall give
Optionee any right to continued employment or affect in any manner the right of
the Company or any subsidiary or parent corporation to terminate the employment
of Optionee.
10. Miscellaneous. This Agreement shall be binding upon and inure to the
benefit of any successors to the Company and all persons lawfully claiming
under Optionee. This Agreement and all actions taken hereunder shall be
governed by and constructed in accordance with the laws of the State of
Delaware. In the event of conflict between this Agreement and the Plan, the
terms of the Plan shall control. A copy of the Plan is attached hereto as
Exhibit A, and the Plan is incorporated herein by this reference. The
Committee shall have authority to construe the terms of this Agreement, and the
Committee's determinations shall be final and binding on Optionee and the
Company.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed and Optionee has executed this Agreement as of the day and year first
above written.
OPTIONEE GIBRALTAR PACKAGING GROUP, INC.
/s/ Walter E. Rose By: /s/ Rebecca L. Couturier
- ------------------ ----------------------------
Name: Rebecca L. Couturier
--------------------------
Title: Assistant Secretary
-------------------------
<PAGE>
EXHIBIT 7.3
GIBRALTAR PACKAGING GROUP, INC.
1996 NON-QUALIFIED STOCK OPTION PLAN
1. Purpose
The purpose of the Gibraltar Packaging Group, Inc. 1996 Non-Qualified
Stock Option Plan (the "1996 Plan") is to enhance the ability of Gibraltar
Packaging Group, Inc. (the "Company") and its Subsidiaries (as defined below)
to attract and retain individuals possessing superior managerial talent to
serve as employees of the Company and its Subsidiaries, and to provide
long-term incentives to such persons to contribute to the future success and
prosperity of the Company and its Subsidiaries. Accordingly, under the 1996
Plan the Company may grant to key employees options ("Options") to purchase
shares of the Company's common stock, par value $.01 per share ("Common
Stock").
For purposes of the 1996 Plan, a "Subsidiary" shall be any corporation in
which the Company has a direct or indirect ownership interest of 50% or more
of the total combined voting power of all classes of stock in such corporation.
2. Administration and Interpretation
A. Administration. The 1996 Plan shall be administered by the
Compensation Committee (the "Committee") of the Board of Directors of the
Company (the "Board"). The Committee may prescribe, amend and rescind the
rules and regulations for administration of the 1996 Plan and shall have full
power and authority to construe and interpret the 1996 Plan. The Committee may
correct any defect or any omission or reconcile any inconsistency in the 1996
Plan or in any grant made under the 1996 Plan in the manner and to the extent
it shall deem desirable.
Committee members shall be appointed by and shall serve at the
pleasure of the Board. All members of the Committee shall be "disinterested
persons" within the meaning of Rule 16b-3 of the General Rules and Regulations
of the Securities Exchange Act of 1934 (the "1934 Act"). The Board may from
time to time appoint members of the Committee in substitution for or in
addition to members previously appointed and may fill vacancies, however
caused, in the Committee. A majority of the members of the Committee shall
constitute a quorum, and the acts of a majority of the members present at a
meeting, or the acts of a majority of the members evidenced in writing, shall
be the acts of the Committee. Members of the Committee may, in the discretion
of the Board, receive compensation for their services as members, and all
expenses and liabilities they incur in connection with the administration of
the 1996 Plan shall be borne by the Company.
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The day-to-day administration of the 1996 Plan may be carried out by
such officers and employees of the Company or its Subsidiaries as shall be
designated from time to time by the Committee. The Committee may employ
attorneys, consultants, accountants, appraisers, brokers or other persons, and
the Committee, the Company and the officers and employees of the Company shall
be entitled to rely upon the advice, opinions or valuations of any such
persons.
The Committee shall have the authority (i) to make all decisions
concerning Options granted under the 1996 Plan, including without limitation
the selection of the persons to whom Options are granted, the number of shares
of Common Stock subject to each Option and the terms and conditions of each
Option; (ii) to construe the terms and provisions of the 1996 Plan and the
option agreements ("Agreements") under which Options are granted; and (iii) to
adopt, from time to time, such rules and regulations, not inconsistent with the
terms of the 1996 Plan, as it may deem advisable to carry out the 1996 Plan.
All decisions by the Committee shall be final. The effective date of an
Option, as determined by the Committee, is referred to herein as the "Grant
Date."
B. Interpretation. The interpretation and construction by the Committee
of any provisions of the 1996 Plan or of any grant under the 1996 Plan and any
determination by the Committee under any provision of the 1996 Plan or any such
grant shall be final and conclusive for all purposes.
C. Limitation on Liability. Neither the Committee nor any member
thereof shall be liable for any act, omission, interpretation, construction or
determination made in connection with the 1996 Plan in good faith, and the
members of the Committee shall be entitled to indemnification and reimbursement
by the Company in respect of any claim, loss, damage or expense (including
counsel fees) arising therefrom to the full extent permitted by law and the
certificate of incorporation of the Company. The members of the Committee, if
appointed, shall be named as insureds under any directors and officers
liability insurance coverage that may be in effect from time to time.
3. Shares Subject to Grants Under the 1996 Plan
The aggregate number of shares which may be issued under Options granted
under the 1996 Plan shall not exceed 300,000 shares of Common Stock. Such
shares may consist of authorized but unissued shares of Common Stock or
previously issued shares of Common Stock reacquired by the Company. Any of
such shares which remain unissued and which are not subject to outstanding
Options at the termination of the 1996 Plan shall cease to be subject to the
1996 Plan, but until termination of the 1996 Plan, the Company shall at all
times make available a sufficient number of shares to meet the requirements of
the 1996 Plan and the outstanding Options. The number of shares of Common
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Stock that are available for Options under the 1996 Plan shall be decreased by
each exercise of an Option, and to the extent that such Option lapses the
shares theretofore subject to such Option may again be subject to other Options
granted under the 1996 Plan. If any Option, in whole or in part, expires or
terminates unexercised or is canceled or forfeited, the shares theretofore
subject to such Option may be subject to another Option granted under the 1996
Plan. The aggregate number of shares which may be issued under Options granted
under the 1996 Plan shall be subject to adjustment as provided in Section 6
hereof.
4. Eligibility
The individuals who shall be eligible to receive Options under the 1996
Plan shall be such key employees of the Company and its Subsidiaries as the
Committee from time to time shall determine. In granting Options, the
Committee shall take into consideration the contribution an individual has made
or may make to the success of the Company or its Subsidiaries and such other
factors as the Committee shall determine. The Committee shall also have the
authority to consult with and receive recommendations from officers and other
employees of the Company and its Subsidiaries with regard to these matters. In
no event shall any individual or his legal representatives, heirs, legatees,
distributees or successors have any right to participate in the 1996 Plan
except to such extent, if any, as the Committee shall determine.
Options may be granted under the 1996 Plan from time to time in
substitution for stock options, restricted stock or other stock-based
compensation granted by other corporations where, as a result of a merger or
consolidation of such other corporation with the Company or a Subsidiary, or
the acquisition by the Company or a Subsidiary of the assets of such other
corporation, or the acquisition by the Company or a Subsidiary of stock of, or
other beneficial ownership interest in, such other corporation, the individuals
who held such other stock options, restricted stock or other stock-based
compensation become eligible to receive Options under the 1996 Plan.
5. Grants and Terms of Options
A. Grants of Options. Grants of Options under the 1996 Plan shall be
for such number of shares of Common Stock and shall be subject to such terms
and conditions as the Committee shall designate.
B. Terms of Options. Each grant of an Option shall be evidenced by an
Agreement executed by the recipient of the Option (the "Optionee") and an
authorized officer of the Company. Each Agreement shall be in a form approved
by the Committee, shall comply with and be subject to the terms and conditions
of the 1996 Plan and may contain such other provisions, consistent with the
terms and conditions of the 1996 Plan, as the Committee shall deem advisable.
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References herein to an Agreement shall include, to the extent applicable, any
amendment to the Agreement and any interpretation or construction thereof by
the Committee pursuant to this 1996 Plan.
(1) Exercise of Options. Options shall not be exercisable prior to
the date six months following the Grant Date. In addition, the Committee may
include in each Agreement a provision stating that the Option granted therein
may not be exercised in whole or in part for an additional period of time
specified in such Agreement, and may further limit the exercisability of the
Option in such manner as the Committee deems appropriate, including, without
limitation, the achievement of specified performance goals or other criteria.
Except as provided herein or as so specified in the Agreement or in a
resolution of the Committee, any Option may be exercised in whole at any time
or in part from time to time during its term. The Committee may, in its
discretion, at any time and from time to time accelerate the exercisability of
all or part of any Option, provided such Option shall not be exercisable prior
to the date six months following its Grant Date. An Optionee may exercise an
Option by providing written notice to the Company at any time or from time to
time during the period such Option is exercisable and by satisfying such other
conditions as are set forth in the Agreement relating to the Option including,
without limitation, satisfying the requirements for tax withholding, if any,
with respect to such exercise in a manner acceptable to the Committee, which
may include, in its discretion, withholding of shares to be acquired upon such
exercise.
(2) Payment of Option Exercise Price. Upon exercise of an Option,
the full price per share (the "Exercise Price") for the shares with respect to
which the Option is being exercised shall be payable to the Company (i) in cash
or by check payable and acceptable to the Company or (ii) subject to the
approval of the Committee, (a) by tendering to the Company shares of Common
Stock owned by the Optionee having an aggregate Market Value Per Share (as
defined below) as of the date of exercise and tender that is not greater than
the Exercise Price for the shares with respect to which the Option is being
exercised and by paying any remaining amount of the Exercise Price as provided
in (i) above; provided, however, that the Committee may, upon confirming that
the Optionee owns the number of additional shares being tendered, authorize the
issuance of a new certificate for the number of shares being acquired pursuant
to the exercise of the Option less the number of shares being tendered upon the
exercise, and return to the Optionee (or not require surrender of) the
certificate for the shares being tendered upon the exercise; or (b) by the
Optionee delivering to the Company a properly executed exercise notice together
with irrevocable instructions to a broker to promptly deliver to the Company
cash or a check payable and acceptable to the Company to pay the option
exercise price; provided that in the event the Optionee chooses to pay the
Option exercise as provided in (ii)(b) above, the Optionee and the broker shall
comply with such procedures and enter into such agreements of indemnity and
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other agreements as the Committee shall prescribe as a condition of such
payment procedure. Payment instructions will be received subject to
collection.
(3) Number of Shares. Each Agreement shall state the total number
of shares of Common Stock that is subject to the Option, which option shall be
subject to adjustment pursuant to Section 6.
(4) Exercise Price. The Exercise Price for each Option shall be
fixed by the Committee on the Grant Date. The Exercise Price shall be in no
event less than the par value of the Common Stock. The Exercise Price shall be
subject to adjustment pursuant to Section 6.
(5) Term. The term of each Option shall be determined by the
Committee at the Grant Date; provided, however, that each Option shall expire
no later than ten years from the Grant Date (such date, as determined by the
Committee or provided for herein, being referred to hereafter as the
"Expiration time"); provided further, however, if the initial term of an Option
is for less than 10 years, the Committee, in its discretion, may modify the
Expiration Time to a date that is no later than 10 years from the initial Grant
Date.
(6) Termination of Employment. If the employment of an Optionee is
terminated for any reason other than a Qualified Termination (defined below),
the Option granted to such Optionee shall automatically expire simultaneously
with such termination. In the event of termination of an Optionee's employment
due to death, retirement, on or after reaching age 65 (or if prior to age 65,
with the consent of the Committee), permanent disability (as determined under
the standards of the Company's long-term disability program) or termination by
the Company for any reason other than "cause" (each of such four events being a
"Qualified Termination"), the Option may be exercised by the Optionee (or his
estate, personal representative or beneficiary) at any time within the
three-month period commencing on the day next following such Qualified
Termination (or within the next succeeding three months if the Optionee dies or
becomes disabled within the three-month period following a Qualified
Termination relating to other than the Optionee's death or disability) to the
full extent that the Optionee was entitled to exercise the same on the day
immediately prior to such Qualified Termination. For purposes of this clause,
"cause" shall mean:
(i) Final conviction of the Optionee of a felony under the laws
of the United States or any state thereof which results or was intended to
result directly or indirectly in gain or personal enrichment by the Optionee at
the expense of the Company;
(ii) Participation by the Optionee as an employee, officer or
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principal shareholder in any business engaged in activities in direct
competition with the Company without the consent of the Company; or
(iii) Gross and willful inattention to Optionee's duties as
an employee for a continuous period of three months other than due to
Optionee's total physical disability, or other cause reasonably beyond the
control of Optionee, which inattention to duty has a material adverse effect on
the Company.
Notwithstanding the foregoing however, the Committee may, in its
discretion provide that an Option shall remain outstanding and be exercisable
following termination of employment on such other terms and conditions as the
Committee shall approve.
6. Recapitalization or Reorganization
A. The existence of the 1996 Plan and the Options granted hereunder
shall not affect in any way the right or power of the Board or the shareholders
of the Company to make or authorize any adjustment, recapitalization,
reorganization or other change in the Company's capital structure or its
business, any merger or consolidation of the Company, any issue of bonds,
debentures, or shares of preferred stock ahead of or affecting Common Stock or
the rights thereof, the dissolution or liquidation of the Company or any sale
or transfer of all or any part of its assets or business, or any other
corporate act or proceeding.
B. The shares with respect to which Options may be granted are shares of
Common Stock as presently constituted. If, and whenever, prior to the
termination of the 1996 Plan or the expiration of an outstanding Option, the
Company shall effect a subdivision of shares of Common Stock or the payment of
a stock dividend on Common Stock without receipt of consideration by the
Company, the remaining shares of Common Stock available under the 1996 Plan and
the number of shares of Common Stock with respect to which outstanding Options
may thereafter be exercised shall be proportionately increased, and the
Exercise Price under outstanding Options shall be proportionately reduced. If,
and whenever, prior to the termination of the 1996 Plan or the expiration of an
outstanding Option, the Company shall effect a consolidation of shares of
Common Stock, the remaining shares of Common Stock available under the 1996
Plan and the number of shares of Common Stock with respect to which any
outstanding Option may thereafter be exercised shall be proportionately
reduced, and the Exercise Price under the outstanding Options shall be
proportionately increased.
C. Except as may otherwise be expressly provided in the 1996 Plan, the
issuance by the Company of shares of stock of any class or securities
convertible into shares of stock of any class, for cash, property, labor or
services, upon direct sale, upon the exercise of rights or warrants to
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subscribe therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, and in any case whether or
not for fair value, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number of shares of Common Stock available under
the 1996 Plan or subject to Options theretofore granted or the Exercise Price
per share.
D. Unless otherwise provided in any Option, each outstanding Option
shall become immediately fully exercisable:
(1) if there occurs any transaction (which shall include a series of
transactions occurring within 60 days or occurring pursuant to a plan), that
has the result that stockholders of the Company immediately before such
transaction cease to own at least 51% of the voting stock of the Company or of
any entity that results from the participation of the Company in a
reorganization, consolidation, merger, liquidation or any other form of
corporate transaction;
(2) if the stockholders of the Company approve a plan of merger,
consolidation, reorganization, liquidation or dissolution in which the Company
does not survive (unless the approved merger, consolidation, reorganization,
liquidation or dissolution is subsequently abandoned); or
(3) if the stockholders of the Company approve a plan for the sale,
lease, exchange, transfer, assignment or other disposition of all or
substantially all the property and assets of the Company (unless such plan is
subsequently abandoned).
E. Any adjustment provided for above shall be subject to any required
shareholder action.
7. Recipient's Agreement
If, in the opinion of counsel for the Company, at the time of the exercise
of any Option it is necessary or desirable, in order to comply with any then
applicable laws or regulations relating to the sale of securities, for the
individual exercising the Option to agree to hold any shares issued to the
individual for investment and without intention to resell or distribute the
same and for the individual to agree to dispose of such shares only in
compliance with such laws and regulations, the individual shall be required,
upon the request of the Company, to execute and deliver to the Company a
further agreement to such effect.
8. Miscellaneous
A. No Employment Contract. Nothing contained in the 1996 Plan shall be
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construed as conferring upon any employee the right to continue in the employ
of the Company or any Subsidiary.
B. Employment with Subsidiaries. Employment by the Company for the
purpose of this 1996 Plan shall be deemed to include employment by, and to
continue during any period in which an employee is in the employment of, any
Subsidiary.
C. No Rights as a Shareholder. A person granted an Option under the
1996 Plan shall have no rights as a shareholder with respect to shares covered
by such person's Option until the date of the issuance of shares to the person
upon the exercise of the Option. No adjustment will be made for dividends or
other distributions or rights for which the record date is prior to the date of
such issuance.
D. No Restriction on Corporate Action. Nothing contained in the 1996
Plan shall be construed to prevent the Company or any Subsidiary from taking
any corporate action that is deemed by the Company or such Subsidiary to be
appropriate or in its best interest, whether or not such action would have an
adverse effect on the 1996 Plan or any Option granted under the 1996 Plan. No
person that receives, or is eligible to receive, Options under the 1996 Plan
shall have any claim against the Company or any Subsidiary as a result of any
such action.
E. Transferability. A person that receives Options under the 1996 Plan
or such person's beneficiary shall have the power or right to sell, exchange,
pledge, transfer, assign or otherwise encumber or dispose of such person's or
beneficiary's Options received under the 1996 Plan only as follows: (1) to the
spouse or any children or grandchildren of such person that receives Options
under the 1996 Plan; (2) as a charitable contribution or gift to or for the use
of any person or entity described in Section 170(c) of the Internal Revenue
Code of 1986, as amended; (3) to any "Controlled Entity," as such term is
defined below; or (4) by will or the laws of intestate succession. "Controlled
Entity" means any trust, partnership. limited liability company or other entity
in which such person that receives Options under the 1996 Plan acts as trustee,
managing partner, managing member or otherwise controls; provided that to the
extent any such Option received under the 1996 Plan is awarded to a spouse
pursuant to any divorce proceeding, such interest shall be deemed to be
terminated and forfeited notwithstanding any vesting provisions or other terms
herein or in the Agreement evidencing such Option.
F. Governing Law; Construction. All rights and obligations under the
1996 Plan shall be governed by, and the 1996 Plan shall be construed in
accordance with, the laws of the State of Delaware without regard to the
principles of conflicts of laws. Titles and headings to Sections herein are
for purposes of reference only, and shall in no way limit, define or otherwise
affect the meaning or interpretation of any provisions of the 1996 Plan.
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G. Amendment and Termination. The Committee may from time to time and
at any time alter, amend, suspend, discontinue or terminate this 1996 Plan and
any grants of Options hereunder. The 1996 Plan shall terminate on the tenth
anniversary date of the effective date of the 1996 Plan and no Options shall be
awarded after such date.
H. Preemption by Applicable Laws and Regulations. Anything in the 1996
Plan or any Agreement to the contrary notwithstanding, if, at any time
specified herein or therein for the making of any determination or the taking
of any action, any law, regulation or requirements of any governmental
authority having jurisdiction in the premises shall require the Company to take
any additional action not otherwise required by the 1996 Plan or an Agreement
in connection with any such determination or action, the making of such
determination or the taking of such action, as the case may be, shall be
deferred until such additional action shall have been taken.
I. Effective Date. The 1996 Plan was adopted by the Board on August 1,
1996, and shall be deemed to have become effective on that date.
