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EXHIBIT 99.1
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SCHEIN PHARMACEUTICAL, INC.
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
(AMENDED AND RESTATED AS OF AUGUST 24, 1998)
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TABLE OF CONTENTS
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I. PURPOSES..............................................................2
II. DEFINITIONS...........................................................2
A. "Act"..........................................................2
B. "Board"........................................................2
C. "Committee"....................................................2
D. "Common Stock".................................................2
E. "Eligible Director"............................................2
F. "Eligible Director -- Class 1".................................2
G. "Eligible Director -- Class 2".................................2
H. "Fair Market Value"............................................2
I. "Option".......................................................3
J. "Share"........................................................3
K. "Termination of Directorship"..................................3
III. EFFECTIVE DATE........................................................3
IV. ADMINISTRATION........................................................3
A. Duties of the Committee........................................3
B. Advisors.......................................................3
C. Indemnification................................................4
D. Meetings of the Committee......................................4
V. ADJUSTMENTS...........................................................4
A. Shares to be Delivered: Fractional Shares......................4
B. Number of Shares...............................................4
C. Adjustments....................................................4
VI. AWARDS AND TERMS OF OPTIONS...........................................5
A. Grant..........................................................5
B. Date of Grant..................................................6
C. Option Terms...................................................6
D. Expiration.....................................................6
E. Acceleration of Exercisability.................................6
VII. EFFECT OF TERMINATION OF DIRECTORSHIP.................................8
VIII. NONTRANSFERABILITY OF OPTIONS.........................................8
IX. RIGHTS AS A STOCKHOLDER...............................................8
X. TERMINATION, AMENDMENT AND MODIFICATION...............................8
XI. ISSUANCE OF STOCK CERTIFICATES: LEGENDS: PAYMENT OF EXPENSE...........9
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TABLE OF CONTENTS
(CONTINUED)
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PAGE
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A. Stock Certificate..............................................9
B. Legends........................................................9
C. Payment of Expenses............................................9
XII. LISTING OF SHARES AND RELATED MATTER..................................9
XIII. WITHHOLDING TAXES.....................................................9
XIV. GENERAL...............................................................9
A. Right to Terminate Directorship................................9
B. Ng Trust.......................................................9
C. Notices........................................................9
D. Severability..................................................10
E. Costs.........................................................10
F. Controlling Law...............................................10
G. Section 16(b).................................................10
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ii.
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SCHEIN PHARMACEUTICAL, INC.
1995 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
(AMENDED AND RESTATED AS OF AUGUST 24, 1998)
I. PURPOSES
The purposes of this 1995 Non-Employee Director Stock Option Plan (this
"Plan"), as amended and restated effective as of August 24, 1998, are to enable
Schein Pharmaceutical, Inc. (the "Company") to attract, retain and motivate
directors who will be important to the success of the Company, and to increase
the identity of interest between directors and stockholders of the Company by
granting certain directors options to purchase common stock of the Company.
II. DEFINITIONS
For purposes of this Plan, the following terms have the following
meanings:
A. "ACT" means the Securities Exchange Act of 1934 and the rules and
regulations under the Securities Exchange Act of 1934.
B. "BOARD" means the board of directors of the Company.
C. "COMMITTEE" means the Board or a duly appointed committee of the
Board to which the Board has delegated its power and functions under this Plan.
D. "COMMON STOCK" means the common stock of the Company, par value $0.01
per share, any common stock into which such common stock of the Company may be
converted and any common stock resulting from any reclassification of such
common stock.
E. "ELIGIBLE DIRECTOR" means an Eligible Director -- Class I or an
Eligible Director -- Class 2.
F. "ELIGIBLE DIRECTOR -- CLASS 1" means a director of the Company who is
not an Eligible Director -- Class 2 and who is not an active employee of the
Company or any subsidiary of the Company.
G. "ELIGIBLE DIRECTOR -- CLASS 2" means a director of the Company
designated by the Board as such at the time the director is first elected to
serve on the Board or, in the case of members of the Board at the time this Plan
is adopted, a director of the Company designated by the Board as such at that
time, and, in each case, who is not an active employee of the Company or any
subsidiary of the Company (it being understood that the Board shall have the
right, but shall not be required, to designate a director as an Eligible
Director -- Class 2, and that the Board shall designate a director as an
Eligible Director -- Class 2 only if, at the time of the designation, the
director shall have waived all future annual fees for serving as a director of
the Company but not fees for attending Board meetings or committee meetings or
reimbursement of out-of-pocket expenses for traveling to and from and attending
such meetings).
H. "FAIR MARKET VALUE" means the value of a Share as of a particular
date determined as follows:
1. If the Common Stock is listed or admitted to trading on that
date on a national securities exchange or is quoted on the Nasdaq National
Market, the closing sale price of a Share as reported on the
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relevant composite transaction tape, if applicable, or on the principal national
securities exchange or through the Nasdaq National Market, as the case may be,
on that date, or, in the absence of reported sales on that date, the mean
between the highest reported bid and lowest reported asked prices reported on
the relevant composite transaction tape or national securities exchange or
through the Nasdaq National Market, as the case may be, on that date.
2. If the Common Stock is not listed or quoted as described in
clause 1, but bid and asked prices are quoted through Nasdaq, the mean between
the highest reported bid and the lowest reported asked prices as quoted through
Nasdaq on that date.
3. If the Fair Market Value would otherwise be determined in
accordance with clause 2 but the Committee determines that that would not
properly reflect the Fair Market Value, by any other method the Committee
determines to be reasonable.
4. If the Common Stock is not publicly traded, an amount
determined by the Committee in good faith.
I. "OPTION" means the right to purchase one Share at a prescribed
purchase price on the terms specified in this Plan.
J. "SHARE" means a share of Common Stock.
K. "TERMINATION OF DIRECTORSHIP" with respect to an individual means
that individual is no longer a director of the Company.
III. EFFECTIVE DATE
This Plan became effective January 1, 1995 (the "Effective Date"), and
was approved on September 30, 1995 by holders of a majority of the outstanding
Shares at the time of approval. This Plan was amended and restated as of August
8, 1996, and further amended and restated as of August 24, 1998.
IV. ADMINISTRATION
A. DUTIES OF THE COMMITTEE. This Plan shall be administered by the
Committee The Committee shall have full authority to interpret this Plan and to
decide any questions and settle any controversies or disputes that may arise in
connection with this Plan; to establish, amend and rescind rules for carrying
out this Plan; to administer this Plan; to prescribe the forms of instruments
evidencing Options and any other instruments required under this Plan, and to
change such forms from time to time; and to make all other determinations and to
take all actions in connection with this Plan and the Options as the Committee,
in its sole discretion, deems necessary or desirable. The Committee shall not be
bound to any standards of uniformity or similarity of action, interpretation or
conduct in the discharge of its duties under this Plan. Any determination,
action or conclusion of the Committee shall be final, conclusive and binding on
all parties.
B. ADVISORS. The Committee may employ such legal counsel, consultants
and agents as it deems desirable for the administration of this Plan, and may
rely upon any advice or opinion received from any such counsel or consultant and
any computation received from any such consultant or agent. The Company shall
pay all the expenses of any such counsel, consultant or agent.
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C. INDEMNIFICATION. To the maximum extent permitted by applicable law,
no officer of the Company or member or former member of the Committee or of the
Board shall be liable for any action or determination made in good faith with
respect to this Plan or any Option granted under it. To the maximum extent
permitted by applicable law and the certificate of incorporation and by-laws of
the Company, the Company shall indemnify and hold harmless each officer and
member or former member of the Committee and the Board against any cost or
expense (including reasonable fees of counsel reasonably acceptable to the
Company) or liability (including any sum paid in settlement of a claim with the
approval of the Company), and advanced amounts necessary to pay the foregoing at
the earliest time and to the fullest extent permitted, arising out of any act or
omission to act in connection with this Plan. Such indemnification shall be in
addition to any rights of an indemnitee under applicable law or the certificate
of incorporation or by-laws of the Company. Notwithstanding anything to the
contrary in this paragraph, however, the rights under this paragraph shall not
apply to actions or determinations by an individual with regard to Options
granted to that individual under this Plan.
D. MEETINGS OF THE COMMITTEE. The Committee shall adopt such rules and
regulations as it deems appropriate concerning its meetings and the transaction
of its business. All determinations by the Committee shall be made by the
affirmative vote of a majority of its members. Any such determination may be
made at a meeting duly called and held at which a majority of the members of the
Committee are a attendance in person or through telephonic communication. Any
written determination signed by all the members of the Committee shall be as
effective as if made by a majority vote of the members at a meeting duly called
and held.
V. ADJUSTMENTS
A. SHARES TO BE DELIVERED: FRACTIONAL SHARES. Shares to be issued under
this Plan shall be made available, at the sole discretion of the Board, either
from authorized but unissued Shares or from issued Shares reacquired by the
Company and held in treasury. No fractional Shares shall be issued or
transferred upon the exercise of any Option, nor shall any compensation be paid
with regard to fractional shares.
B. NUMBER OF SHARES. Subject to adjustment as provided in this Article
V. the maximum aggregate number of Shares that may be issued under this Plan
shall be 105,000 (after giving effect to a 105-for-one stock split on April 3,
1998). Where Options are for any reason canceled, or expire or terminate
unexercised, the Shares covered by those Options shall again be available for
the grant of Options, subject to the preceding sentence.
C. ADJUSTMENTS. The existence of this Plan and the Options granted under
this Plan shall not affect in any way the right or power of the Board or the
stockholders 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
issuance of securities, whether or not senior to the Common Stock, 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, but
this Article V(C) shall govern outstanding Options in each such case.
1. If the Company effects a subdivision, recapitalization or
consolidation of Shares or effects a stock dividend on Shares without receipt of
consideration, the aggregate number and kind of shares of capital stock issuable
under this Plan shall be proportionately adjusted, and each holder of a then
outstanding Option shall have the right to purchase under that Option, in lieu
of the number of Shares as to which the Option was then exercisable but or, the
same terms and conditions of exercise set forth in that Option, the number and
kind of shares of capital stock the holder would have owned after the
subdivision, recapitalization, consolidation or
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dividend, if, immediately prior to the subdivision, recapitalization,
consolidation or dividend, the holder had been the holder of record of the
number of Shares as to which that Option was then exercisable.
2. If the Company merges or consolidates with one or more
corporations and the Company is the surviving corporation, thereafter, upon
exercise of an Option theretofore granted, the holder shall be entitled to
purchase under that Option, in lieu of the number of Shares as to which the
Option was then exercisable, but on the same terms and conditions of exercise
set forth in that Option, the number and kind of shares of capital stock or
other property to which the holder would have been entitled pursuant to the
agreement of merger or consolidation, if, immediately prior to the merger or
consolidation, the holder had been the holder of record of the number of Shares
as to which that Option was then exercisable.
3. If the Company is not the surviving corporation in any merger
or consolidation, or if the Company is to be dissolved or liquidated, then,
unless the surviving corporation assumes the Options or substitutes new options
that are determined by the Board in its sole discretion to be substantially
similar in nature and equivalent in terms and value to Options then outstanding,
upon the effective date of the merger, consolidation, liquidation or
dissolution, any unexercised Options shall expire without additional
compensation to the holders; provided that the Committee shall give notice to
each holder at least 20 days prior to the merger, consolidation, dissolution or
liquidation that the Options, if unexercised, will expire upon the merger,
consolidation, dissolution or liquidation, and each holder has the right to
exercise in full, effective as of the consummation of the merger, consolidation,
dissolution or liquidation, all the holder's then outstanding Options (without
regard to limitations on exercise otherwise contained in the Options, other than
pursuant to Article III) contingent on the occurrence of the merger,
consolidation, dissolution or liquidation, and provided that, if the
contemplated transaction does not take place within 90 days after that notice,
the notice, accelerated vesting and exercise shall be null and void.
Notwithstanding the foregoing, the Options held by persons subject to section
16(b) of the Act that would not have vested under this Plan except pursuant to
Article VI(E) prior to the effective date of the merger, consolidation,
liquidation or dissolution shall not expire upon the consummation of the merger,
consummation of the merger, consolidation, liquidation or dissolution, but shall
expire 30 days after they would have otherwise vested under this Plan and shall,
after the merger, consolidation, liquidation or dissolution, represent the right
to receive the number and kind of shares of capital stock or other property to
which the holder would have been entitled, if, immediately prior to the merger,
consolidation, liquidation or dissolution, the holder had been the holder of
record of the number of Shares as to which that Option was then exercisable.
4. If, as a result of any adjustment pursuant to the preceding
paragraphs of this Article V(C) any holder becomes entitled upon exercise of an
Option to receive any shares of capital stock other than Common Stock, then the
number and kind of shares of capital stock so receivable shall be subject to
adjustment from time to time pursuant to this Article V(C), mutates mutandis.
5. Except as provided above, 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 or services, upon direct sale, upon exercise of
rights or warrants or upon conversion of shares or other securities, whether or
not for fair value, shall not affect, and no adjustment by reason of the
issuance shall be made with respect to, the number of Shares subject to Options
granted or the purchase price per Share.
VI. AWARDS AND TERMS OF OPTIONS
A. GRANT. Without further action by the Board or the stockholders of the
Company, each Eligible Director on each Annual Date of Grant (as defined below)
shall be automatically granted Options to purchase a number of Shares determined
by dividing $50,000 by the Fair Market Value on the Annual Date of Grant, in the
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case of each Eligible Director -- Class 1, and a number of Shares determined by
dividing $100,000 by the Fair Market Value on the Annual Date of Grant, in the
case of each Eligible Director -- Class 2; provided that no such Option shall be
granted, if, on the date of grant, the Company shall have liquidated, dissolved
or merged or consolidated with another entity and is not the surviving entity
(unless this Plan shall have been assumed by the surviving entity with regard to
future grants). If an Eligible Director shall first become a member of the Board
on a date other than an Annual Date of Grant, such Eligible Director on the date
he first becomes a member of the Board shall be automatically granted Options to
purchase a number of Shares equal to the number set forth above (i) multiplied
by a fraction, the numerator of which shall be the number of days from the date
of grant until the next following Annual Date of Grant, and the denominator of
which shall be 365 and (ii) divided by the Fair Market Value on the date of
grant. In addition, on August 24, 1998, each then Eligible Director -- Class I
shall be automatically granted Options to purchase a number of Shares determined
by dividing $18,223 by the Fair Market Value on August 24, 1998, and each then
Eligible Director -- Class 2 shall be automatically granted Options to purchase
a number of Shares determined by dividing $11,554 by the Fair Market Value on
August 24, 1998.
B. DATE OF GRANT. Grants shall be made on the Effective Date, annually
on each anniversary of the Effective Date (the "Annual Date of Grant") and at
such other times as provided in Article VI(A) provided that, if the Common Stock
is then publicly traded and that date in any year is a date on which the
national securities exchange or automated quotation system on which the Common
Stock is primarily traded or through which it is primarily quoted is not open
for trading or quotation, the grant shall be made on the first day thereafter on
which the relevant exchange or quotation system is open for trading or
quotation.
C. OPTION TERMS.
1. The purchase price per Share ("Purchase Price") deliverable
upon the exercise of an Option shall be 100% of the Fair Market Value at the
time of the grant of the Option, or the par value of a Share, whichever is
greater.
2. Except as otherwise provided in this Plan each Option (a)
granted prior to August 8, 1996 shall be exercisable with respect to 20% of the
Shares subject to the Option on or after the first anniversary of the date of
grant and with respect to an additional 20% of the Shares subject to the Option
on or after each of the next four anniversaries of the date of grant, and (b)
granted on or after August 8, 1996 shall be exercisable with respect to
one-third of the Shares subject to the Option on or after the first anniversary
of the date of grant and with respect to an additional one-third of the Shares
subject to the Option on or after each of the next two anniversaries of the date
of grant.
3. An Option holder electing to exercise one or more Options
shall give written notice to the secretary of the Company of the election and
the number of Options the holder elects to exercise. Shares so purchased shall
be paid for at the time of exercise in cash or by delivery of unencumbered
Shares (valued, for these purposes, at 100% of the Fair Market Value at the
time) owned by the holder for at least six months (or such longer period as
required by applicable accounting standards to avoid a charge to earnings) or a
combination of cash and such Shares.
D. EXPIRATION. Except as otherwise provided in this Plan, if not
previously exercised, each Option shall expire upon the tenth anniversary of the
date of grant.
E. ACCELERATION OF EXERCISABILITY. All Options granted and not
previously exercisable shall become fully exercisable immediately upon a Change
of Control (as defined below). A "Change of Control" shall be deemed to have
occurred upon:
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1. any individual, entity or group (within the meaning of section
13d-3 or l4d-1 of the Act) (a "Person") directly or indirectly being a
beneficial owner (within the meaning of Rule 13d-3 under the Act, except that a
Person shall not be deemed a beneficial owner of securities solely by virtue of
that Person's rights under any voting trust or shareholders agreement in effect
on the Effective Date) of more than 50% of the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Voting Securities"); excluding, however,
the following: (x) the Company, (y) any employee benefit plan (or related trust)
sponsored or maintained by the Company or (z) any corporation that becomes a
beneficial owner pursuant to a reorganization, merger, consolidation or similar
corporate transaction (in each case, a "Corporate Transaction"), if, pursuant to
the Corporate Transaction, the conditions described in clauses (a), (b) and (c)
of paragraph 3 below are satisfied; or
2. a change in the composition of the Board, such that the
individuals who, as of the Effective Date, constitute the Board (the Board as of
the Effective Date, the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board; provided that, for purposes of this clause, any
individual who becomes a member of the Board subsequent to the Effective Date
and whose election, or nomination for election by the Company's stockholders,
was approved by the members of the Board who also are members of the Incumbent
Board (or so deemed to be pursuant to this proviso) shall be deemed a member of
the Incumbent Board; but, provided further that any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of Regulation
14A under the Act) or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board shall not be so deemed
a member of the Incumbent Board; or
3. the approval by the stockholders of the Company of a Corporate
Transaction, or, if consummation of the Corporate Transaction is subject, at the
time of such approval by stockholders, to the consent of any government or
governmental agency, the obtaining of the consent (either explicitly or
implicitly by consummation); excluding, however, such a Corporate Transaction
pursuant to which (a) the beneficial owners (or beneficiaries of the beneficial
owners) of the outstanding Shares and Outstanding Voting Securities immediately
prior to the Corporate Transaction will beneficially own, directly or
indirectly, more than 60% of, respectively, the outstanding shares of common
stock of the corporation resulting from the Corporate Transaction and the
combined voting power of the outstanding voting securities of that corporation
entitled to vote generally in the election of directors, in substantially the
same proportions as their ownership, immediately prior to the Corporate
Transaction, of the outstanding Shares and Outstanding Voting Securities, as the
case may be, (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 and any Person beneficially owning, immediately prior to
the Corporate Transaction, directly or indirectly, 20% or more of the
outstanding Shares or Outstanding Voting Securities, as the case may be) will
beneficially own, directly or indirectly, 20% or more of, respectively, the
outstanding shares of common stock of the corporation resulting from the
Corporate Transaction or the combined voting power of the then outstanding
securities of that corporation entitled to vote generally in the election of
directors and (c) individuals who were members of the Incumbent Board will
constitute at least a majority of the members of the board of directors of the
corporation resulting from the Corporate Transaction; or
4. the approval of the stockholders of the Company of (a) a
complete liquidation or dissolution of the Company or (b) the sale or other
disposition of all or substantially all the assets of the Company; excluding,
however, such a sale or other disposition to a corporation with respect to
which, following the sale or other disposition, (i) more than 60% of the then
outstanding shares of common stock of that corporation and the combined voting
power of the then outstanding voting securities of that corporation entitled to
vote generally in the election of directors will be then beneficially owned,
directly or indirectly, by the individuals and entities
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who were the beneficial owners (or beneficiaries of the beneficial owners),
respectively, of the outstanding Shares and Outstanding Voting Securities
immediately prior to the sale or other disposition in substantially the same
proportion as their ownership, immediately prior to the sale or other
disposition, of the outstanding Shares and Outstanding Voting Securities, as the
case may be, (ii) no Person (other than the Company and any employee benefit
plan (or related trust) of the Company or that corporation and any Person
beneficially owning, immediately prior to such sale or other disposition,
directly or indirectly, 20% or more of the outstanding Shares or Outstanding
Voting Securities, as the case may be) will beneficially own, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of that corporation and the combined voting power of the then outstanding
voting securities of that corporation entitled-to vote generally in the election
of directors and (iii) individuals who were members of the Incumbent Board will
constitute at least a majority of the members of the board of directors of that
corporation.
VII. EFFECT OF TERMINATION OF DIRECTORSHIP
Upon Termination of Directorship for any reason other than cause, all
outstanding Options shall continue to vest, and remain exercisable until the
expiration of the Option, in accordance with this Plan. Upon Termination of
Directorship for cause, all outstanding Options shall terminate and become null
and void.
VIII. NONTRANSFERABILITY OF OPTIONS
No Option shall be transferable by the holder otherwise than by will or
under applicable laws of descent and distribution, and, during the lifetime of
the holder, may be exercised only by the holder or the holder's guardian or
legal representative. In addition, except as provided above, no Option shall be
assigned, negotiated, pledged or hypothecated (whether by operation of law or
otherwise), and no Option shall be subject to execution, attachment or similar
process. Upon any attempt to transfer, assign, negotiate, pledge or hypothecate
any Option, or in the event of any levy upon any Option by reason of any
execution, attachment or similar process contrary to the provisions of this
paragraph, the Option shall immediately terminate and become null and void.
IX. RIGHTS AS A STOCKHOLDER
A holder of an Option (or a permitted transferee of an Option) shall
have no rights as a stockholder with respect to any Shares covered by the
holder's Options, until the holder (or permitted transferee) shall have become
the holder of record of the Shares, and no adjustments shall be made for
dividends in cash or other property or distributions or other rights in respect
of any Shares, except as otherwise specifically provided in this Plan.
X. TERMINATION, AMENDMENT AND MODIFICATION
This Plan shall terminate at the close of business on the tenth
anniversary of the Effective Date (the "Termination Date"), unless terminated
sooner as provided in this Plan, and no Option shall be granted under this Plan
on or after that date. The termination of this Plan shall not terminate any
outstanding Options that by their terms continue beyond the Termination Date.
The Committee at any time or from time to time may amend this Plan to effect (A)
amendments necessary or desirable in order that this Plan and the Options shall
conform to all applicable laws and regulations, and (B) any other amendments
deemed appropriate. Notwithstanding the foregoing, the Committee may not effect
any amendment that would require the approval of the stockholders of the Company
unless the approval is obtained.
This Plan may be amended or terminated at any time by the stockholders
of the Company.
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Except as otherwise required by law, no termination, amendment or
modification of this Plan may, without the consent of the holder of an Option or
the permitted transferee of the holder's Option, alter or impair the rights and
obligations under any then outstanding Option.
XI. ISSUANCE OF STOCK CERTIFICATES: LEGENDS: PAYMENT OF EXPENSE
A. STOCK CERTIFICATE. Upon any exercise of an Option and payment of the
exercise price as provided in the Option, a certificate or certificates for the
Shares as to which the Option has been exercised shall be issued by the Company
in the name of the person or persons exercising the Option and shall be
delivered to or upon the order of that person or those persons, subject,
however, in the case of Options exercised pursuant to clause 3 of Article V(C),
to the merger, consolidation, dissolution or liquidation triggering the rights
under that section.
B. LEGENDS. Certificates for Shares issued upon exercise of an Option
shall bear such legends as the Committee, in its sole discretion, determines to
be necessary or appropriate to prevent a violation of, or to perfect an
exemption from, the registration requirements of the Securities Act of 1933 or
to implement the provisions of any agreements between the Company and the holder
of the Option with respect to the Shares.
C. PAYMENT OF EXPENSES. The Company shall pay all issue or transfer
taxes with respect to the issuance or transfer of Shares, as well as all fees
and expenses incurred by the Company in connection with the issuance or transfer
and with the administration of this Plan.
XII. LISTING OF SHARES AND RELATED MATTER
If at any time the Board or the Committee determines in its sole
discretion that the listing, registration or qualification of the Shares covered
by this Plan upon any national 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 grant of
Options or the award or sale of Shares under this Plan, no Option grant shall be
effective and no Shares shall be delivered, as the case may be, unless and until
such listing, registration, qualification, consent or approval shall have been
effected or obtained, or otherwise provided for, free of any conditions not
acceptable to the Board.
XIII. WITHHOLDING TAXES
The Company shall have the right to require, prior to the issuance or
delivery of any Shares, payment by the holder of an Option of any federal, state
or local taxes required by law to be withheld.
XIV. GENERAL
A. RIGHT TO TERMINATE DIRECTORSHIP. This Plan shall not impose any
obligation on the Company to retain any Eligible Director as a director, nor
shall it impose any obligation on the part of any Eligible Director to remain as
a director.
B. NG TRUST. Nothing in this Plan and no action taken pursuant to this
Plan (including, without limitation, the grant of any Option) shall create or be
construed to create a trust of any kind, or a fiduciary relationship, between
the Company and any Option holder or the executor, administrator or other
personal representative or designated beneficiary of a holder or any other
person.
C. NOTICES. Any notice or other communication to the Company under this
Plan shall be addressed to the Company at its principal executive offices from
time to time. Each Eligible Director shall be responsible for
<PAGE> 12
furnishing the Committee with the Eligible Director's current address for the
mailing to that Eligible Director of notices and other communications. Any
notice or other communication to the Eligible Director shall, if the Company has
received notice that the Eligible Director is then deceased, be given to the
Eligible Director's personal representative, if that representative has
previously informed the Company of his or her status and address (and has
provided such reasonable substantiating information as the Company may request)
by written notice under this section. Any notice under this Plan shall be deemed
to have been given when delivered in person or when dispatched by telegram or
one business day after having been dispatched by a nationally recognized
overnight courier service or three business days after having been mailed by
United States registered or certified mail, return receipt requested, postage
prepaid.
D. SEVERABILITY. If any provision of this Plan is held invalid or
unenforceable, the invalidity or unenforceability shall not affect any other
provision of this Plan, and this Plan shall be construed and enforced as if that
provision had not been included.
E. COSTS. The Company shall bear all expenses included in administering
this Plan, including expenses of issuing Common Stock pursuant to any Options.
F. CONTROLLING LAW. This Plan shall be construed and enforced according
to the laws of the state of incorporation of the Company.
G. SECTION 16(b). All elections and transactions under this Plan by
persons subject to section 16 of the Act involving shares of Common Stock are
intended to comply with all exemptive conditions under Rule 16b-3. To the extent
any provision of this Plan or action by the Committee fails so to comply, it
shall be deemed null and void. The Committee may establish and adopt written
administrative guidelines, designed to facilitate compliance with section 16(b)
of the Act, as it may deem necessary or proper for the administration and
operation of this Plan and the transaction of business under this Plan.
