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EXHIBIT (C)(11)
3-D GEOPHYSICAL 1995 LONG-TERM
INCENTIVE COMPENSATION PLAN
Amended and Restated January 5, 1996
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Table of Contents
Page
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ARTICLE I
GENERAL
1.1 Purpose................................................................................. 1
1.2 Administration.......................................................................... 1
1.3 Persons Eligible for Awards............................................................. 3
1.4 Types of Awards Under Plan.............................................................. 3
1.5 Shares Available for Awards............................................................. 4
1.6 Definitions of Certain Terms............................................................ 5
ARTICLE II
AWARDS UNDER THE PLAN
2.1 Agreements Evidencing Awards............................................................ 8
2.2 Grant of Stock Options, Stock Appreciation
Rights ............................................................................... 8
2.3 Grant of Stock Options to Non-Employee
Directors ............................................................................ 11
2.4 Exercise of Options and Stock Appreciation
Rights................................................................................ 12
2.5 Termination of Employment; Death........................................................ 15
2.6 Grant of Restricted Stock............................................................... 17
ARTICLE III
MISCELLANEOUS
3.1 Amendment of the Plan; Modification
of Awards............................................................................. 20
3.2 Restrictions............................................................................ 21
3.3 Nonassignability........................................................................ 22
3.4 Requirement of Notification of Election
Under Section 83(b) of the Code....................................................... 22
3.5 Requirement of Notification Upon
Disqualifying Disposition Under
Section 421(b) of the Code............................................................ 23
3.6 Right of Discharge Reserved............................................................. 23
3.7 Nature of Payments...................................................................... 23
3.8 Non-Uniform Determinations.............................................................. 24
3.9 Other Payments or Awards................................................................ 24
3.10 Section Headings........................................................................ 25
3.11 Effective Date and Term of Plan......................................................... 25
3.12 Governing Law........................................................................... 25
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ARTICLE I
GENERAL
1.1 Purpose
The purpose of the 3-D Geophysical 1995 Long-Term Incentive
Plan (the "Plan") is to provide for directors, officers and key employees of,
and consultants to, 3-D Geophysical, Inc. (the "Company") and its subsidiaries
an incentive (a) to enter into and remain in the service of the Company or its
subsidiaries, (b) to enhance the long-term performance of the Company and its
subsidiaries, and (c) to acquire a proprietary interest in the success of the
Company and its subsidiaries.
1.2 Administration
1.2.1 Subject to Section 1.2.6, the Plan shall be administered
by the Compensation Committee (the "Committee") of the board of directors of the
Company (the "Board"), which shall consist of not less than two directors. The
members of the Committee shall be appointed by, and serve at the pleasure of,
the Board. To the extent required for transactions under the Plan to qualify for
the exemptions available under Rule 16b-3 ("Rule 16b-3") promulgated under the
Securities Exchange Act of 1934 (the "1934 Act"), no person may serve on the
Committee if, during the year preceding such service, he was granted or awarded
equity securities of the Company (including options on such
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securities) under the Plan or any other plan of the Company or any affiliate
thereof (other than a grant pursuant to Section 2.3 hereof).
1.2.2 The Committee shall have the authority (a) to exercise
all of the powers granted to it under the Plan, (b) to construe, interpret and
implement the Plan and any Plan Agreements executed pursuant to Section 2.1, (c)
to prescribe, amend and rescind rules and regulations relating to the Plan,
including rules governing its own operations, (d) to make all determinations
necessary or advisable in administering the Plan, (e) to correct any defect,
supply any omission and reconcile any inconsistency in the Plan, and (f) to
amend the Plan to reflect changes in applicable law.
1.2.3 Actions of the Committee shall be taken by the vote of a
majority of its members. Any action may be taken by a written instrument signed
by a majority of the Committee members, and action so taken shall be fully as
effective as if it had been taken by a vote at a meeting.
1.2.4 The determination of the Committee on all matters
relating to the Plan or any Plan Agreement shall be final, binding and
conclusive.
1.2.5 No member of the Committee shall be liable for
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any action or determination made in good faith with respect to the Plan or any
award thereunder.
1.2.6 Notwithstanding anything to the contrary contained
herein: (a) until the Board shall appoint the members of the Committee, the Plan
shall be administered by the Board; and (b) the Board may, in its sole
discretion, at any time and from time to time, resolve to administer the Plan.
In either of the foregoing events, the term "Committee" as used herein shall be
deemed to mean the Board.
1.3 Persons Eligible for Awards
Awards under the Plan may be made to such officers, directors,
and executive, administrative, technical or professional employees of, and
consultants to, the Company and its subsidiaries (collectively, "key persons")
as the Committee shall in its sole discretion select. Awards to directors who
are not employees of the Company or a subsidiary shall be made only pursuant to
Section 2.3.
1.4 Types of Awards Under Plan
Awards may be made under the Plan in the form of (a) incentive
stock options, (b) nonqualified stock options, (c) stock appreciation rights and
(d) restricted stock, all as more fully set forth in Article II. The term
"award" means any
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of the foregoing. No incentive stock option may be granted to a person who is
not an employee of the Company on the date of grant.
1.5 Shares Available for Awards
1.5.1 The total number of shares of common stock of the
Company, par value $0.01 per share ("Common Stock"), with respect to which
awards may be granted pursuant to the Plan shall not exceed 720,000 shares. Such
shares may be authorized but unissued Common Stock or authorized and issued
Common Stock held in the Company's treasury or acquired by the Company for the
purposes of the Plan. The Committee may direct that any stock certificate
evidencing shares issued pursuant to the Plan shall bear a legend setting forth
such restrictions on transferability as may apply to such shares pursuant to the
Plan.
1.5.2 If there is any change in the outstanding shares of
Common Stock by reason of a stock dividend or distribution, stock split-up,
recapitalization, combination or exchange of shares, or by reason of any merger,
consolidation, spinoff or other corporate reorganization in which the Company is
the surviving corporation, the number of shares available for issuance both in
the aggregate and with respect to each outstanding award, and the purchase price
per share under outstanding awards, shall be equitably adjusted by the
Committee, whose determination
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shall be final, binding and conclusive. After any adjustment made pursuant to
this Section 1.5.2, the number of shares subject to each outstanding award shall
be rounded to the nearest whole number.
1.5.3 The following shares of Common Stock shall become
available for further awards under the Plan: any shares subject to an award
under the Plan that remain unissued upon the cancellation or termination of such
award for any reason whatsoever; any shares of restricted stock forfeited
pursuant to Section 2.5.5; any shares in respect of which a stock appreciation
right is settled for cash; and any shares tendered in payment upon the exercise
of an option or stock appreciation right. Except as provided in Section 2.2.8,
there shall be no limit on the number or the value of the shares of Common Stock
that may be subject to awards to any individual under the Plan.
1.6 Definitions of Certain Terms
1.6.1 The "Fair Market Value" of a share of Common Stock on
any day shall be determined as follows.
(a) If the principal market for the Common Stock (the
"Market") is a national securities exchange or the National Association of
Securities Dealers Automated Quotation System ("NASDAQ") National Market, the
last sale price or, if no report-
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ed sales take place on the applicable date, the average of the high bid and low
asked price of Common Stock as reported for such Market on such date or, if no
such quotation is made on such date, on the next preceding day on which there
were quotations, provided that such quotations shall have been made within the
ten (10) business days preceding the applicable date;
(b) If the Market is the NASDAQ National List, the
NASDAQ Supplemental List or another market, the average of the high bid and low
asked price for Common Stock on the applicable date, or, if no such quotations
shall have been made on such date, on the next preceding day on which there were
quotations, provided that such quotations shall have been made within the ten
(10) business days preceding the applicable date; or,
(c) In the event that neither paragraph (a) nor (b)
shall apply, the Fair Market Value of a share of Common Stock on any day shall
be determined in good faith by the Committee.
1.6.2 The term "incentive stock option" means an option that
is intended to qualify for special federal income tax treatment pursuant to
sections 421 and 422 of the Internal Revenue Code of 1986 (the "Code"), as now
constituted or subsequently amended, or pursuant to a successor provision of the
Code, and which is so designated in the applicable Plan Agreement. Any option
that is not specifically designated as an
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incentive stock option shall under no circumstances be considered an incentive
stock option. Any option that is not an incentive stock option is referred to
herein as a "nonqualified stock option."
1.6.3 The term "employment" means, in the case of a grantee of
an award under the Plan who is not an employee of the Company or a subsidiary,
the grantee's membership on the Board or status as a consultant to the Company
or a subsidiary.
1.6.4 A grantee shall be deemed to have a "termination of
employment" upon ceasing to be employed by the Company and all of its
subsidiaries or by a corporation assuming awards in a transaction to which
section 425(a) of the Code applies. The Committee may in its discretion
determine whether any leave of absence constitutes a termination of employment
for purposes of the Plan and the impact, if any, of any such leave of absence on
awards theretofore made under the Plan. The Committee shall have the right to
determine whether the termination of a grantee's employment is a dismissal for
cause and the date of termination in such case, which date the Committee may
retroactively deem to be the date of the action that is cause for dismissal.
Such determinations of the Committee shall be final, binding and conclusive.
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1.6.5 The terms "parent corporation" and "subsidiary
corporation" have the meanings given them in section 425(e) and (f) of the Code,
respectively.
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ARTICLE II
AWARDS UNDER THE PLAN
2.1 Agreements Evidencing Awards
Each award granted under the Plan shall be evidenced by a
written agreement ("Plan Agreement") which shall contain such provisions as the
Committee may in its sole discretion deem necessary or desirable. By accepting
an award pursuant to the Plan, a grantee thereby agrees that the award shall be
subject to all of the terms and provisions of the Plan and the applicable Plan
Agreement.
2.2 Grant of Stock Options and Stock
Appreciation Rights
2.2.1 The Committee may grant incentive stock options and
nonqualified stock options (collectively, "options") to purchase shares of
Common Stock from the Company, to such key persons, and in such amounts and
subject to such terms and conditions, as the Committee shall determine in its
sole discretion, subject to the provisions of the Plan.
2.2.2 The Committee may grant stock appreciation rights to
such key persons, and in such amounts and subject to such terms and conditions,
as the Committee shall determine in its sole discretion, subject to the
provisions of the Plan. Stock appreciation rights may be granted in connection
with all
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or any part of, or independently of, any option granted under the Plan. A stock
appreciation right granted in connection with a nonqualified stock option may be
granted at or after the time of grant of such option. A stock appreciation right
granted in connection with an incentive stock option may be granted only at the
time of grant of such option.
2.2.3 The grantee of a stock appreciation right shall have the
right, subject to the terms of the Plan and the applicable Plan Agreement, to
receive from the Company an amount equal to (a) the excess of the Fair Market
Value of a share of Common Stock on the date of exercise of the stock
appreciation right over (b) the Fair Market Value of a share of Common Stock on
the date of grant (or over the option exercise price if the stock appreciation
right is granted in connection with an option), multiplied by (c) the number of
shares with respect to which the stock appreciation right is exercised. Payment
upon exercise of a stock appreciation right shall be in cash or in shares of
Common Stock (valued at their Fair Market Value on the date of exercise of the
stock appreciation right) or both, all as the Committee shall determine in its
sole discretion. Upon the exercise of a stock appreciation right granted in
connection with an option, the number of shares subject to the option shall be
reduced by the number of shares with respect to which the stock appreciation
right is exercised. Upon the exercise of an option
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in connection with which a stock appreciation right has been granted, the number
of shares subject to the stock appreciation right shall be reduced by the number
of shares with respect to which the option is exercised.
2.2.4 Each Plan Agreement with respect to an option shall set
forth the amount (the "option exercise price") payable by the grantee to the
Company upon exercise of the option evidenced thereby. The option exercise price
per share shall be determined by the Committee in its sole discretion; provided,
however, that the exercise price of an incentive stock option shall be at least
100% of the Fair Market Value of a share of Common Stock on the date the option
is granted, and provided further that in no event shall the option exercise
price be less than the par value of a share of Common Stock.
2.2.5 Each Plan Agreement with respect to an option or stock
appreciation right shall set forth the periods during which the award evidenced
thereby shall be exercisable, whether in whole or in part. Such periods shall be
determined by the Committee in its sole discretion; provided, however, that no
incentive stock option (or a stock appreciation right granted in connection with
an incentive stock option) shall be exercisable more than 10 years after the
date of grant.
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2.2.6 To the extent that the aggregate Fair Market Value
(determined as of the time the option is granted) of the stock with respect to
which incentive stock options are first exercisable by any employee during any
calendar year shall exceed $100,000, or such higher amount as may be permitted
from time to time under section 422 of the Code, such options shall be treated
as nonqualified stock options.
2.2.7 Notwithstanding the provisions of Sections 2.2.4 and
2.2.5, an incentive stock option may not be granted under the Plan to an
individual who, at the time the option is granted, owns stock possessing more
than 10% of the total combined voting power of all classes of stock of his
employer corporation or of its parent or subsidiary corporations (as such
ownership may be determined for purposes of section 422(b)(6) of the Code)
unless (a) at the time such incentive stock option is granted the option
exercise price is at least 110% of the Fair Market Value of the shares subject
thereto and (b) the incentive stock option by its terms is not exercisable after
the expiration of 5 years from the date it is granted.
2.3 Grant of Stock Options to Non-Employee Directors.
2.3.1 This Section 2.3 sets forth the provisions pursuant to
which nonqualified stock options shall be granted to those directors of the
Company who are not employees of the Com-
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pany or a subsidiary. The terms of such options as set forth herein may not be
varied other than by amendment of this Section 2.3 in accordance with Section
3.1. To the extent that any administrative action is required in connection with
this Section 2.3, such action shall be taken by the Board, whose determination
in such case shall be conclusive.
2.3.2 Nonqualified stock options shall be granted under this
Section 2.3 only to persons who are members of the Board and are not employees
of the Company or any subsidiary thereof ("Eligible Directors").
2.3.3 On the effective date of the initial public offering of
the Common Stock, each person who then satisfies the definition of Eligible
Director shall be granted a nonqualified stock option for 10,000 shares of
Common Stock at the price established for such public offering. Thereafter, upon
the initial election to the Board of any other person who satisfies the
definition of Eligible Director, such person shall be granted an option to
purchase 10,000 shares of Common Stock at the Fair Market Value on the date of
such person's election to the Board.
2.3.4 Each option granted under this Section 2.3 shall have a
term of 10 years, and shall become exercisable as to one-third of the shares
subject thereto on each of the first, second
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and third anniversaries of the date of grant. An option may be exercised from
time to time for all or part of the shares as to which it is then exercisable.
2.4 Exercise of Options and Stock Appreciation Rights
Subject to the provisions of this Article II, each option or
stock appreciation right granted under the Plan shall be exercisable as follows:
2.4.1 Unless the applicable Plan Agreement otherwise provides,
an option or stock appreciation right shall become exercisable in four
substantially equal installments, the first of which shall become exercisable on
the first anniversary of the date of grant and the remaining three of which
shall become exercisable, respectively, on the second, third and fourth
anniversaries of the date of grant.
2.4.2 Unless the applicable Plan Agreement otherwise provides,
once an installment becomes exercisable, it shall remain exercisable until
expiration, cancellation or termination of the award.
2.4.3 Unless the applicable Plan Agreement otherwise provides,
an option or stock appreciation right may be exercised from time to time as to
all or part of the shares as to which such award is then exercisable. A stock
appreciation right
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granted in connection with an option may be exercised at any time when, and to
the same extent that, the related option may be exercised.
2.4.4 An option or stock appreciation right shall be exercised
by the filing of a written notice with the Company, on such form and in such
manner as the Committee shall in its sole discretion prescribe. In the case of a
grantee of a stock appreciation right whose transactions in Common Stock are
subject to Section 16(b) of the 1934 Act, an election to exercise the stock
appreciation right in whole or in part shall, to the extent required to conform
to applicable interpretations of Rule 16b-3, be subject to the approval of the
Committee in its sole discretion, occur no sooner than six months after the
grant thereof, and be made irrevocably at least six months prior to such
exercise unless both the election and the exercise are made in a single "window
period" of 10 business days beginning on the third day following release of the
Company's quarterly or annual summary statement of sales and earnings.
2.4.5 Any written notice of exercise of an option shall be
accompanied by payment for the shares being purchased. Such payment shall be
made: (a) by certified or official bank check (or the equivalent thereof
acceptable to the Company) for the full option exercise price; or (b) with the
consent of the Committee (except that such consent shall not be required in the
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case of an option granted pursuant to Section 2.3), by delivery of shares of
Common Stock acquired at least six months prior to the option exercise date and
having a Fair Market Value (determined as of the exercise date) equal to all or
part of the option exercise price and a certified or official bank check (or the
equivalent thereof acceptable to the Company) for any remaining portion of the
full option exercise price; or (c) except in the case of an option granted
pursuant to Section 2.3, at the discretion of the Committee and to the extent
permitted by law, by such other provision as the Committee may from time to time
prescribe.
2.4.6 Each Plan Agreement evidencing an option (other than an
option granted pursuant to Section 2.3) shall provide that, upon the filing of
the notice described in Section 2.4.4, the Committee may in its discretion
determine that the Company shall make a payment to the grantee in lieu of
exercise of the option, which payment shall be equal to (a) the excess of the
Fair Market Value of a share of Common Stock on the date of such notice over (b)
the option exercise price, multiplied by (c) the number of shares with respect
to which the grantee proposes to exercise the option. Such payment shall be made
to the grantee in cash or in shares of Common Stock (valued at their Fair Market
Value on the notice date) or both, as the Committee shall determine in its sole
discretion.
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2.4.7 Promptly after receiving payment of the full option
exercise price, or after receiving notice of the exercise of a stock
appreciation right for which payment will be made partly or entirely in shares,
or after a determination by the Committee to make a payment in lieu of exercise
partly or entirely in shares, the Company shall, subject to the provisions of
Section 3.2, deliver to the grantee or to such other person as may then have the
right to exercise the award, a certificate or certificates for the shares of
Common Stock for which the award has been exercised. If the method of payment
employed upon option exercise so requires, and if applicable law permits, an
optionee may direct the Company to deliver the certificate(s) to the optionee's
stockbroker.
2.4.8 No grantee of an option or stock appreciation right (or
other person having the right to exercise such award) shall have any of the
rights of a stockholder of the Company with respect to shares subject to such
award until the issuance of a stock certificate to such person for such shares.
Except as otherwise provided in Section 1.5.2, no adjustment shall be made for
dividends, distributions or other rights (whether ordinary or extraordinary, and
whether in cash, securities or other property) for which the record date is
prior to the date such stock certificate is issued.
2.5 Termination of Employment; Death
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2.5.1 Except to the extent otherwise provided in Section 2.5.2
or 2.5.3 or in the applicable Plan Agreement, all options and stock appreciation
rights not theretofore exercised shall terminate upon termination of the
grantee's employment (which, in the case of an Eligible Director, shall mean his
membership on the Board) for any reason (including death).
2.5.2 If a grantee's employment terminates for any reason
other than death or dismissal for cause, the grantee may exercise any
outstanding option or stock appreciation right on the following terms and
conditions: (a) exercise may be made only to the extent that the grantee was
entitled to exercise the award on the date of employment termination; and (b)
exercise must occur within three months after employment terminates, except that
the three-month period shall be increased to one year if termination is by
reason of disability, but in no event after the expiration date of the award as
set forth in the Plan Agreement.
2.5.3 If a grantee dies while employed by the Company or any
subsidiary, or after employment termination but during the period in which the
grantee's awards are exercisable pursuant to Section 2.5.2, any outstanding
option or stock appreciation right shall be exercisable on the following terms
and conditions:
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(a) exercise may be made only to the extent that the grantee was entitled to
exercise the award on the date of death; and (b) exercise must occur by the
earlier of the first anniversary of the grantee's death or the expiration date
of the award. Any such exercise of an award following a grantee's death shall be
made only by the grantee's executor or administrator, unless the grantee's will
specifically disposes of such award, in which case such exercise shall be made
only by the recipient of such specific disposition. If a grantee's personal
representative or the recipient of a specific disposition under the grantee's
will shall be entitled to exercise any award pursuant to the preceding sentence,
such representative or recipient shall be bound by all the terms and conditions
of the Plan and the applicable Plan Agreement which would have applied to the
grantee.
2.6 Grant of Restricted Stock
2.6.1 The Committee may grant restricted shares of Common
Stock to such key persons, in such amounts, and subject to such terms and
conditions as the Committee shall determine in its sole discretion, subject to
the provisions of the Plan. Restricted stock awards may be made independently of
or in connection with any other award under the Plan. A grantee of a restricted
stock award shall have no rights with respect to such award unless such grantee
accepts the award within such period as the Committee shall specify by executing
a Plan Agreement in such
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form as the Committee shall determine and, if the Committee shall so require,
makes payment to the Company by certified or official bank check (or the
equivalent thereof acceptable to the Company) in such amount as the Committee
may determine.
2.6.2 Promptly after a grantee accepts a restricted stock
award, the Company shall issue in the grantee's name a certificate or
certificates for the shares of Common Stock covered by the award. Upon the
issuance of such certificate(s), the grantee shall have the rights of a
stockholder with respect to the restricted stock, subject to the
nontransferability restrictions and Company repurchase rights described in
Sections 2.6.4 and 2.6.5, subject also to such other restrictions and conditions
as the Committee in its discretion may include in the applicable Plan Agreement.
2.6.3 Unless the Committee shall otherwise determine, any
certificate issued evidencing shares of restricted stock shall remain in the
possession of the Company until such shares are free of any restrictions
specified in the applicable Plan Agreement.
2.6.4 Shares of restricted stock may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as
specifically provided in this Plan or the applicable Plan Agreement. The
Committee at the time of grant
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shall specify the date or dates (which may depend upon or be related to the
attainment of performance goals and other conditions) on which the
nontransferability of the restricted stock shall lapse. Unless the applicable
Plan Agreement provides otherwise, additional shares of Common Stock or other
property distributed to the grantee in respect of shares of restricted stock, as
dividends or otherwise, shall be subject to the same restrictions applicable to
such restricted stock.
2.6.5 During the 90 days following termination of the
grantee's employment for any reason, the Company shall have the right to require
the return of any shares to which restrictions on transferability apply, in
exchange for which the Company shall repay to the grantee (or the grantee's
estate) any amount paid by the grantee for such shares.
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ARTICLE III
MISCELLANEOUS
3.1 Amendment of the Plan; Modification of Awards
3.1.1 The Board may from time to time suspend, discontinue,
revise or amend the Plan in any respect whatsoever, except that no such
amendment shall materially impair any rights or materially increase any
obligations under any award theretofore made under the Plan without the consent
of the grantee (or, after the grantee's death, the person having the right to
exercise the award). Notwithstanding the foregoing, Sections 2.3.2, 2.3.3 and
2.3.4 may not be amended more than once every six months except as may be
necessary to comply with changes in the Internal Revenue Code, the Employee
Retirement Income Security Act, or the regulations thereunder.
3.1.2 Shareholder approval shall be required with respect to
any amendment (a) which increases the aggregate number of shares which may be
issued pursuant to incentive stock options or changes the class of employees
eligible to receive such options or (b) for which approval is required for
compliance with Rule 16b-3.
3.1.3 The Committee may amend any outstanding Plan Agreement
other than one evidencing an award under Section 2.3,
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including, without limitation, by amendment which would (a) accelerate the time
or times at which the award becomes unrestricted or may be exercised, or (b)
waive or amend any goals, restrictions or conditions set forth in the Agreement,
or (c) waive or amend the operation of Section 2.5 with respect to the
termination of the award at termination of employment. However, any such or
amendment that materially impairs the rights or materially increases the
obligations of a grantee under an outstanding award shall be made only with the
consent of the grantee (or, upon the grantee's death, the person having the
right to exercise the award).
3.2 Restrictions
3.2.1 If the Committee shall at any time determine that any
Consent (as hereinafter defined) is necessary or desirable as a condition of, or
in connection with, the granting of any award under the Plan, the issuance or
purchase of shares or other rights thereunder, or the taking of any other action
thereunder (each such action being hereinafter referred to as a "Plan Action"),
then such Plan Action shall not be taken, in whole or in part, unless and until
such Consent shall have been effected or obtained to the full satisfaction of
the Committee.
3.2.2 The term "Consent" as used herein with respect to any
Plan Action means (a) any and all listings, registrations
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or qualifications in respect thereof upon any securities exchange or under any
federal, state or local law, rule or regulation, (b) any and all written
agreements and representations by the grantee with respect to the disposition of
shares, or with respect to any other matter, which the Committee shall deem
necessary or desirable to comply with the terms of any such listing,
registration or qualification or to obtain an exemption from the requirement
that any such listing, qualification or registration be made and (c) any and all
consents, clearances and approvals in respect of a Plan Action by any
governmental or other regulatory bodies.
3.3 Nonassignability
To the extent necessary to comply with section 422 of the Code
and with applicable interpretations of Rule 16b-3, no award or right granted to
any person under the Plan shall be assignable or transferable other than by will
or by the laws of descent and distribution, and all such awards and rights shall
be exercisable during the life of the grantee only by the grantee or the
grantee's legal representative. No assignment or transfer shall be made without
consent of the Committee.
3.4 Requirement of Notification of
Election Under Section 83(b) of the Code
If any grantee shall, in connection with the acquisi-
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tion of shares of Common Stock under the Plan, make the election permitted under
section 83(b) of the Code (i.e., an election to include in gross income in the
year of transfer the amounts specified in section 83(b)), such grantee shall
notify the Company of such election within 10 days of filing notice of the
election with the Internal Revenue Service, in addition to any filing and
notification required pursuant to regulations issued under the authority of Code
section 83(b).
3.5 Requirement of Notification Upon Disqualifying
Disposition Under Section 421(b) of the Code
Each Plan Agreement with respect to an incentive stock option
shall require the grantee to notify the Company of any disposition of shares of
Common Stock issued pursuant to the exercise of such option under the
circumstances described in section 421(b) of the Code (relating to certain
disqualifying dispositions), within 10 days of such disposition.
3.6 Right of Discharge Reserved
Nothing in the Plan or in any Plan Agreement shall confer upon
any grantee the right to continue in the employ of the Company or any subsidiary
thereof or affect any right which the Company may have to terminate such
employment.
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3.7 Nature of Payments
3.7.1 Any and all grants of awards and issuances of shares of
Common Stock under the Plan shall be in consideration of services performed for
the Company or a subsidiary by the grantee.
3.7.2 All such grants and issuances shall constitute a special
incentive payment to the grantee and shall not be taken into account in
computing the amount of salary or compensation of the grantee for the purpose of
determining any benefits under any pension, retirement, profit-sharing, bonus,
life insurance or other benefit plan of the Company or a subsidiary or under any
agreement between the Company or a subsidiary and the grantee, unless such plan
or agreement specifically provides otherwise.
3.8 Non-Uniform Determinations
The Committee's determinations under the Plan need not be
uniform and may be made by it selectively among persons who receive, or are
eligible to receive, awards under the Plan (whether or not such persons are
similarly situated). Without limiting the generality of the foregoing, the
Committee shall be entitled, among other things, to make non-uniform and
selective determinations, and to enter into non-uniform and selective Plan
agreements, as to (a) the persons to receive awards under the Plan, (b) the
terms and provisions of awards under the Plan, and
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(c) the treatment of leaves of absence pursuant to Section 1.6.4. 3.9 Other
Payments or Awards
Nothing contained in the Plan shall be deemed in any way to
limit or restrict the Company and its subsidiaries from making any award or
payment to any person under any other plan, arrangement or understanding,
whether now existing or hereafter in effect.
3.10 Section Headings
The section headings contained herein are for the purpose of
convenience only and are not intended to define or limit the contents of the
sections.
3.11 Effective Date and Term of Plan
3.11.1 The Plan was adopted by the Board on November 10, 1995,
subject to approval by the Company's shareholders. All awards under the Plan
prior to such shareholder approval are subject in their entirety to such
approval. If such approval is not obtained prior to the first anniversary of the
date of adoption of the Plan, the Plan and all awards thereunder shall terminate
on that date.
3.11.2 Unless sooner terminated by the Board, the Plan shall
terminate on the tenth anniversary of its adoption by the
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Board. All awards made under the Plan prior to its termination shall remain in
effect until such awards have been satisfied or terminated in accordance with
the terms and provisions of the Plan and the applicable Plan Agreements.
3.12 Governing Law
All rights and obligations under the Plan shall be construed
and interpreted in accordance with the laws of the State of [New York], without
giving effect to principles of conflict of laws.
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