Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Annual Report 10 80K
4: EX-10.13 Gartner Group 1998 Long Term Stock Option Plan 16 62K
5: EX-10.15 Gartner Group 1996 Long Term Stock Option Plan 13 51K
6: EX-10.20 Employment Agreement 12 63K
7: EX-10.21 Employment Agreement 12 63K
2: EX-10.6 Gartner Group, Inc. 1991 Stock Option Plan 23 76K
3: EX-10.9 Gartner Group, Inc. Long Term Stock Option Plan 16 53K
8: EX-13.1 Annual Report 51 288K
9: EX-21.1 Subsidiaries of Registrant 2± 9K
10: EX-23.1 Independent Auditors' Report on Schedule 1 7K
11: EX-23.2 Independent Auditors' Consent 1 7K
12: EX-27.1 Financial Data Schedule 1 10K
EX-10.6 — Gartner Group, Inc. 1991 Stock Option Plan
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Exhibit 10.6
GARTNER GROUP, INC.
1991 STOCK OPTION PLAN
As amended and restated on October 12, 1999
This 1991 Stock Option Plan is an amendment and restatement of the Gartner
Group, Inc. 1991 Stock Option and Appreciation Right Incentive Compensation
Plan.
1. Purpose of the Plan. The purpose of this Stock Option Plan is to enable
the Company to provide incentive to eligible employees, consultants and officers
whose present and potential contributions are important to the continued success
of the Company, to afford these individuals the opportunity to acquire a
proprietary interest in the Company, and to enable the Company to enlist and
retain in its employment qualified personnel for the successful conduct of its
business. It is intended that this purpose will be effected through the granting
of (a) stock options, (b) stock purchase rights, (c) stock appreciation rights,
and (d) long-term performance awards.
2. Definitions. As used herein, the following definitions shall apply:
(a) "Administrator" means the Board or such of its Committees as
shall be administering the Plan, in accordance with Section 8 of the Plan.
(b) "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under applicable securities laws, Delaware
corporate law and the Code.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
(e) "Committee" means a Committee appointed by the Board in
accordance with Section 8 of the Plan.
(f) "Common Stock" means the Common Stock, $.01 par value, of the
Company.
(g) "Company" means Gartner Group, Inc., a Delaware corporation,
previously known as GGI Holding Corporation.
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(h) "Consultant" means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services and who is compensated
for such services, provided that the term "Consultant" shall not include
Directors who are paid only a director's fee by the Company or who are not
compensated by the Company for their services as Directors.
(i) "Continuous Status as an Employee or Consultant" means that the
employment or consulting relationship is not interrupted or terminated by the
Company, or any Parent or Subsidiary. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of: (i) any leave of
absence approved by the Administrator, including sick leave, military leave, or
any other personal leave; provided, however, that for purposes of Continuous
Status as an Employee or Consultant, no such leave may exceed ninety (90) days,
unless reemployment upon the expiration of such leave is guaranteed by contract
(including written Company policies) or statute or unless (in the case of
Options and Rights other than Incentive Stock Options) the Administrator has
expressly designated a longer leave period during which (for purposes of such
Options or Rights) Continuous Status as an Employee or Consultant shall
continue; or (ii) transfers between locations of the Company or between the
Company, its Parent, its Subsidiaries or its successor; and provided further
that any vesting or lapsing of the Company's right to repurchase Shares at their
original purchase price shall cease on the ninety-first (91st) consecutive day
of any leave of absence approved by the Administrator and shall not recommence
until such date, if any, upon which the Consultant or Optionee resumes his or
her service with the Company. Continuous employment shall be interrupted and
terminated for an Employee if the Employee's weekly work hours change from full
time to part time. Part-time status for the purpose of vesting continuation or
eligibility to receive Options shall be determined in accordance with policies
adopted by the Company from time to time, which policies, if any, shall
supercede the determination of part-time status set forth in the Company's
posted "employee status definitions".
(j) "Director" means a member of the Board.
(k) "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.
(l) "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. Neither
service as a Director nor payment of a director's fee by the Company shall be
sufficient to constitute "employment" by the Company.
(m) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
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(n) "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without
limitation the Nasdaq National Market of the National
Association of Securities Dealers, Inc. Automated
Quotation ("NASDAQ") System, the Fair Market Value of a
share of Common Stock shall be the closing sales price
for such stock (or the closing bid price, if no sales
were reported) as quoted on such exchange or system (or
the exchange with the greatest volume of trading in
Common Stock) on the date of determination, as reported
in The Wall Street Journal or such other source as the
Administrator of the Plan deems reliable.
(ii) If the Common Stock is quoted on the NASDAQ System (but
not on the Nasdaq National Market thereof) or is
regularly quoted by a recognized securities dealer but
selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the
high bid and low asked prices for the Common Stock on the
date of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems
reliable.
(iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good
faith by the Administrator.
(o) "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
(p) "Long-Term Performance Award" means an award under Section 7
below. A Long-Term Performance Award shall permit the recipient to receive a
cash or stock bonus (as determined by the Administrator) upon satisfaction of
such performance factors as are set out in the recipient's individual grant.
Long-term Performance Awards will be based upon the achievement of Company,
Subsidiary and/or individual performance factors or upon such other criteria as
the Administrator may deem appropriate.
(q) "Long-Term Performance Award Agreement" means a written
agreement between the Company and an Optionee evidencing the terms and
conditions of an individual Long-Term Performance Award grant. The Long-Term
Performance Award Agreement is subject to the terms and conditions of the Plan.
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(r) "Nonstatutory Stock Option" means any Option that is not an
Incentive Stock Option.
(s) "Notice of Grant" means a written notice evidencing certain
terms and conditions of an individual Option, Stock Purchase Right, SAR or
Long-Term Performance Award grant. The Notice of Grant is part of the Option
Agreement, the SAR Agreement and the Long-Term Performance Award Agreement.
(t) "Officer" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(u) "Option" means a stock option granted pursuant to the Plan.
(v) "Option Agreement" means a written agreement between the Company
and an Optionee evidencing the terms and conditions of an individual Option
grant. The Option Agreement is subject to the terms and conditions of the Plan.
(w) "Option Exchange Program" means a program whereby outstanding
options are surrendered in exchange for options with a lower exercise price.
(x) "Optioned Stock" means the Common Stock subject to an Option or
Right.
(y) "Optionee" means an Employee or Consultant who holds an
outstanding Option or Right.
(aa) "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(bb) "Plan" means this Stock Option Plan, formerly the 1991 Stock
Option and Appreciation Right Incentive Compensation Plan.
(cc) "Restricted Stock" means shares of Common Stock subject to a
Restricted Stock Purchase Agreement acquired pursuant to a grant of Stock
Purchase Rights under Section 6 below.
(dd) "Restricted Stock Purchase Agreement" means a written agreement
between the Company and the Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan and the
Notice of Grant.
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(ee) "Right" means and includes SARs, Long-Term Performance Awards
and Stock Purchase Rights granted pursuant to the Plan.
(ff) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any
successor rule thereto, as in effect when discretion is being exercised with
respect to the Plan.
(gg) "SAR" means a stock appreciation right granted pursuant to
Section 5 of the Plan.
(hh) "SAR Agreement" means a written agreement between the Company
and an Optionee evidencing the terms and conditions of an individual SAR grant.
The SAR Agreement is subject to the terms and conditions of the Plan.
(ii) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 10 of the Plan.
(jj) "Stock Purchase Right" means the right to purchase Common Stock
pursuant to Section 6 of the Plan, as evidenced by a Notice of Grant.
(kk) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Shares Subject to the Plan. Subject to the provisions of Section 10
of the Plan, the total number of Shares reserved and available for distribution
under the Plan is 32,800,000 Shares. Subject to Section 10 of the Plan, if any
Shares that have been optioned under an Option cease to be subject to such
Option (other than through exercise of the Option), or if any Option or Right
granted hereunder is forfeited or any such award otherwise terminates prior to
the issuance of Common Stock to the participant, the shares that were subject to
such Option or Right shall again be available for distribution in connection
with future Option or right grants under the Plan; provided, however, that
Shares that have actually been issued under the Plan, whether upon exercise of
an Option or Right, shall not in any event be returned to the Plan and shall not
become available for future distribution under the Plan.
4. Eligibility. Nonstatutory Stock Options and Rights may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to
Employees. If otherwise eligible, an Employee or Consultant who has been granted
an Option or Right may be granted additional Options or Rights.
5. Options and SARs.
5
(a) Options. The Administrator, in its discretion, may grant Options
to eligible participants and shall determine whether such Options shall be
Incentive Stock Options or Nonstatutory Stock Options. Each Option shall be
evidenced by a Notice of Grant which shall expressly identify the Options as
Incentive Stock Options or as Nonstatutory Stock Options, and be in such form
and contain such provisions as the Administrator shall from time to time deem
appropriate. Without limiting the foregoing, the Administrator may at any time
authorize the Company, with the consent of the respective recipients, to issue
new Options or Rights in exchange for the surrender and cancellation of
outstanding Options or Rights. Option agreements shall contain the following
terms and conditions:
(i) Exercise Price; Number of Shares. The per Share exercise
price for the Shares issuable pursuant to an Option shall
be such price as is determined by the Administrator;
provided, however, that in the case of an Incentive Stock
Option, the price shall be no less than 100% of the Fair
Market Value of the Common Stock on the date the Option
is granted, subject to any additional conditions set out
in Section 5(a)(iv) below.
The Notice of Grant shall specify the number of Shares to
which it pertains.
(ii) Waiting Period and Exercise Dates. At the time an Option
is granted, the Administrator will determine the terms
and conditions to be satisfied before Shares may be
purchased, including the dates on which Shares subject to
the Option may first be purchased. The Administrator may
specify that an Option may not be exercised until the
completion of the service period specified at the time of
grant. (Any such period is referred to herein as the
"waiting period.") At the time an Option is granted, the
Administrator shall fix the period within which the
Option may be exercised, which shall not be earlier than
the end of the waiting period, if any, nor, in the case
of an Incentive Stock Option, later than ten (10) years,
from the date of grant.
(iii) Form of Payment. The consideration to be paid for the
Shares to be issued upon exercise of an Option, including
the method of payment, shall be determined by the
Administrator (and, in the case of an Incentive
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Stock Option, shall be determined at the time of grant)
and may consist entirely of:
(1) cash;
(2) check;
(3) promissory note;
(4) other Shares which (1) in the case of Shares acquired
upon exercise of an option, have been owned by the
Optionee for more than six months on the date of
surrender, and (2) have a Fair Market Value on the date
of surrender not greater than the aggregate exercise
price of the Shares as to which said Option shall be
exercised;
(5) delivery of a properly executed exercise notice
together with such other documentation as the
Administrator and any broker approved by the Company, if
applicable, shall require to effect an exercise of the
Option and delivery to the Company of the sale or loan
proceeds required to pay the exercise price;
(6) any combination of the foregoing methods of payment;
or
(7) such other consideration and method of payment for
the issuance of Shares to the extent permitted by
Applicable Laws.
(iv) Special Incentive Stock Option Provisions. In addition to
the foregoing, Options granted under the Plan which are
intended to be Incentive Stock Options under Section 422
of the Code shall be subject to the following terms and
conditions:
(1) Dollar Limitation. To the extent that the aggregate
Fair Market Value of (a) the Shares with respect to which
Options designated as Incentive Stock Options plus (b)
the shares of stock of the Company, Parent and any
Subsidiary with respect to which other incentive stock
options are exercisable for the first time by an Optionee
during any calendar year under all plans of the Company
and any Parent
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and Subsidiary exceeds $100,000, such Options shall be
treated as Nonstatutory Stock Options. For purposes of
the preceding sentence, (a) Options shall be taken into
account in the order in which they were granted, and (b)
the Fair Market Value of the Shares shall be determined
as of the time the Option or other incentive stock option
is granted.
(2) 10% Stockholder. If any Optionee to whom an Incentive
Stock Option is to be granted pursuant to the provisions
of the Plan is, on the date of grant, the owner of Common
Stock (as determined under Section 424(d) of the Code)
possessing more than 10% of the total combined voting
power of all classes of stock of the Company or any
Parent or Subsidiary of the Company, then the following
special provisions shall be applicable to the Option
granted to such individual:
(a) The per Share Option price of Shares subject to
such Incentive Stock Option shall not be less than
110% of the Fair Market Value of Common Stock on the
date of grant; and
(b) The Option shall not have a term in excess of five
(5) years from the date of grant.
Except as modified by the preceding provisions of this
subsection 5(a)(iv) and except as otherwise limited by
Section 422 of the Code, all of the provisions of the
Plan shall be applicable to the Incentive Stock Options
granted hereunder.
(v) Other Provisions. Each Option granted under the Plan may
contain such other terms, provisions, and conditions not
inconsistent with the Plan as may be determined by the
Administrator.
(vi) Buyout Provisions. The Administrator may at any time
offer to buy out for a payment in cash or Shares, an
Option previously granted, based on such terms and
conditions as the Administrator shall establish and
communicate to the Optionee at the time that such offer
is made.
(b) SARs.
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(i) In Connection with Options. At the sole discretion of the
Administrator, SARs may be granted in connection with all
or any part of an Option, either concurrently with the
grant of the Option or at any time thereafter during the
term of the Option. The following provisions apply to
SARs that are granted in connection with Options:
(1) The SAR shall entitle the Optionee to exercise the
SAR by surrendering to the Company unexercised a portion
of the related Option. The Optionee shall receive in
Exchange from the Company an amount equal to the excess
of (1) the Fair Market Value on the date of exercise of
the SAR of the Common Stock covered by the surrendered
portion of the related Option over (2) the exercise price
of the Common Stock covered by the surrendered portion of
the related Option. Notwithstanding the foregoing, the
Administrator may place limits on the amount that may be
paid upon exercise of an SAR; provided, however, that
such limit shall not restrict the exercisability of the
related Option.
(2) When an SAR is exercised, the related Option, to the
extent surrendered, shall cease to be exercisable.
(3) An SAR shall be exercisable only when and to the
extent that the related Option is exercisable and shall
expire no later than the date on which the related Option
expires.
(4) An SAR may only be exercised at a time when the Fair
Market Value of the Common Stock covered by the related
Option exceeds the exercise price of the Common Stock
covered by the related Option.
(ii) Independent of Options. At the sole discretion of the
Administrator, SARs may be granted without related
Options. The following provisions apply to SARs that are
not granted in connection with Options:
(1) The SAR shall entitle the Optionee, by exercising the
SAR, to receive from the Company an
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amount equal to the excess of (1) the Fair Market Value
of the Common Stock covered by the exercised portion of
the SAR, as of the date of such exercise, over (2) the
Fair Market Value of the Common Stock covered by the
exercised portion of the SAR, as of the last market
trading date prior to the date on which the SAR was
granted; provided, however, that the Administrator may
place limits on the aggregate amount that may be paid
upon exercise of an SAR.
(2) SARs shall be exercisable, in whole or in part, at
such times as the Administrator shall specify in the
Optionee's SAR agreement.
(iii) Form of Payment. The Company's obligation arising upon
the exercise of an SAR may be paid in Common Stock or in
cash, or in any combination of Common Stock and cash, as
the Administrator, in its sole discretion, may determine.
Shares issued upon the exercise of an SAR shall be valued
at their Fair Market Value as of the date of exercise.
(c) Method of Exercise.
(i) Procedure for Exercise; Rights as a Stockholder. Any
Option or SAR granted hereunder shall be exercisable at
such times and under such conditions as determined by the
Administrator and as shall be permissible under the terms
of the Plan.
An Option may not be exercised for a fraction of a Share.
An Option or SAR shall be deemed to be exercised when
written notice of such exercise has been given to the
Company in accordance with the terms of the Option or SAR
by the person entitled to exercise the Option or SAR and
full payment for the Shares with respect to which the
Option is exercised has been received by the Company.
Full payment may, as authorized by the Administrator
(and, in the case of an Incentive Stock Option,
determined at the time of grant) and permitted by the
Option Agreement consist of any consideration and method
of payment allowable under subsection 5(a)(iii) of the
Plan. Until the issuance (as evidenced by the appropriate
entry
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on the books of the Company or of a duly authorized
transfer agent of the Company) of the stock certificate
evidencing such Shares, no right to vote or receive
dividends or any other rights as a stockholder shall
exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. No adjustment will be made
for a dividend or other right for which the record date
is prior to the date the stock certificate is issued,
except as provided in Section 10 of the Plan.
Exercise of an Option in any manner shall result in a
decrease in the number of Shares which thereafter shall
be available, both for purposes of the Plan and for sale
under the Option, by the number of Shares as to which the
Option is exercised. Exercise of an SAR in any manner
shall, to the extent the SAR is exercised, result in a
decrease in the number of Shares which thereafter shall
be available for purposes of the Plan, and the SAR shall
cease to be exercisable to the extent it has been
exercised.
(ii) Rule 16b-3. Options and SARs granted to individuals
subject to Section 16 of the Exchange Act ("Insiders")
must comply with the applicable provisions of Rule 16b-3
and shall contain such additional conditions or
restrictions as may be required thereunder to qualify for
the maximum exemption from Section 16 of the Exchange Act
with respect to Plan transactions.
(iii) Termination of Employment or Consulting Relationship. In
the event an Optionee's Continuous Status as an Employee
or Consultant terminates (other than upon the Optionee's
death or Disability), the Optionee may exercise his or
her Option or SAR, but only within such period of time as
is determined by the Administrator at the time of grant,
not to exceed six (6) months (three (3) months in the
case of an Incentive Stock Option) from the date of such
termination, and only to the extent that the Optionee was
entitled to exercise it at the date of such termination
(but in no event later than the expiration of the term of
such Option or SAR as set forth in the Option or SAR
Agreement). To the extent that Optionee was not entitled
to exercise an Option or SAR at the date of such
termination, and to the extent that the
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Optionee does not exercise such Option or SAR (to the
extent otherwise so entitled) within the time specified
herein, the Option or SAR shall terminate.
(iv) Disability of Optionee. In the event an Optionee's
Continuous Status as an Employee or Consultant terminates
as a result of the Optionee's Disability, the Optionee
may exercise his or her Option or SAR, but only within
six (6) months from the date of such termination, and
only to the extent that the Optionee was entitled to
exercise it at the date of such termination (but in no
event later than the expiration of the term of such
Option or SAR as set forth in the Option or SAR
Agreement). To the extent that Optionee was not entitled
to exercise an Option or SAR at the date of such
termination, and to the extent that the Optionee does not
exercise such Option or SAR (to the extent otherwise so
entitled) within the time specified herein, the Option or
SAR shall terminate.
(v) Death of Optionee. Notwithstanding Sections 5(c)(iii) and
5(c)(iv) above, in the event of an Optionee's death
during Optionee's Continuous Status as an Employee or
Consultant, the Optionee's estate or a person who
acquired the right to exercise the deceased Optionee's
Option or SAR by bequest or inheritance may exercise the
Option or SAR, but only within six (6) months (or such
lesser period as the Option or SAR Agreement may provide,
or such longer period, not to exceed twelve (12) months,
as the Option or SAR Agreement may provide) following the
date of death, and only to the extent that the Optionee
was entitled to exercise it at the date of death (but in
no event later than the expiration of the full term of
such Option or SAR as set forth in the Option or SAR
Agreement). To the extent that Optionee was not entitled
to exercise an Option or SAR at the date of death, and to
the extent that the Optionee's estate or a person who
acquired the right to exercise such Option does not
exercise such Option or SAR (to the extent otherwise so
entitled) within the time specified herein, the Option or
SAR shall terminate.
(d) The following limitations shall apply to grants of Options to
Employees:
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(i) No Employee shall be granted, in any fiscal year of the
Company, Options to purchase more than 500,000 shares.
(ii) In connection with his or her initial employment, an
Employee may be granted Options to purchase up to an
additional 500,000 Shares which shall not count against
the limit set forth in subsection (i) above.
(iii) The foregoing limitations shall be adjusted
proportionately in connection with any change in the
Company's capitalization as described in Section 10.
(iv) If an Option is canceled in the same fiscal year of the
Company in which it was granted (other than in connection
with a transaction describe in Section 10), the canceled
Option will be counted against the limit set forth in
Section 5(d)(i). For this purpose, if the exercise price
of an Option is reduced, the transaction will be treated
as a cancellation of the Option and the grant of a new
Option.
6. Stock Purchase Rights.
(a) Rights to Purchase. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing of the terms, conditions and restrictions related to the
offer, including the number of Shares that the offeree shall be entitled to
purchase, the price to be paid, and the time within which the offeree must
accept such offer, which shall in no event exceed thirty (30) days from the date
upon which the Administrator made the determination to grant the Stock Purchase
Right. The offer shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.
(b) Repurchase Option. Unless the Administrator determines
otherwise, the Restricted Stock Purchase Agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the purchaser's employment with the Company for any reason (including death or
Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock purchase agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at such rate as the
Administrator may determine.
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(c) Other Provisions. The Restricted Stock Purchase Agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion. In
addition, the provisions of Restricted Stock Purchase Agreements need not be the
same with respect to each purchaser.
(d) Rule 16b-3. Stock Purchase Rights granted to Insiders, and
Shares purchased by Insiders in connection with Stock Purchase Rights, shall be
subject to any restrictions applicable thereto in compliance with Rule 16b-3. An
Insider may only purchase Shares pursuant to the grant of a Stock Purchase
Right, and may only sell Shares purchased pursuant to the grant of a Stock
Purchase Right, during such time or times as are permitted by Rule 16b-3.
(e) Rights as a Stockholder. Once the Stock Purchase Right is
exercised, the purchaser shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 10
of the Plan.
7. Long-Term Performance Awards.
(a) Administration. Long-Term Performance Awards are cash or stock
bonus awards that may be granted either alone or in addition to other awards
granted under the Plan. Such awards shall be granted for no cash consideration.
The Administrator shall determine the nature, length and starting date of any
performance period (the "Performance Period") for each Long-Term Performance
Award, and shall determine the performance or employment factors, if any, to be
used in the determination of Long-Term Performance Awards and the extent to
which such Long-Term Performance Awards are valued or have been earned.
Long-Term Performance Awards may vary from participant to participant and
between groups of participants and shall be based upon the achievement of
Company, Subsidiary, Parent and/or individual performance factors or upon such
other criteria as the Administrator may deem appropriate. Performance Periods
may overlap and participants may participate simultaneously with respect to
Long-Term Performance Awards that are subject to different Performance Periods
and different performance factors and criteria. Long-Term Performance Awards
shall be confirmed by, and be subject to the terms of, a Long-Term Performance
Award agreement. The terms of such awards need not be the same with respect to
each participant.
At the beginning of each Performance Period, the Administrator
may determine for each Long-Term Performance Award subject to such Performance
Period the range of dollar values or number of shares of Common
14
Stock to be awarded to the participant at the end of the Performance Period if
and to the extent that the relevant measures of performance for such Long-Term
Performance Award are met. Such dollar values or number of shares of Common
Stock may be fixed or may vary in accordance with such performance or other
criteria as may be determined by the Administrator.
(b) Adjustment of Awards. The Administrator may adjust the
performance factors applicable to the Long-Term Performance Awards to take into
account changes in legal, accounting and tax rules and to make such adjustments
as the Administrator deems necessary or appropriate to reflect the inclusion or
exclusion of the impact of extraordinary or unusual items, events or
circumstances in order to avoid windfalls or hardships.
8. Administration.
(a) Composition of Administrator.
(i) Multiple Administrative Bodies. If permitted by Rule
16b-3 and Applicable Laws, the Plan may (but need not) be
administered by different administrative bodies with
respect to (A) Directors who are employees, (B) Officers
who are not Directors and (C) Employees who are neither
Directors nor Officers.
(ii) Administration with respect to Directors and Officers.
With respect to grants of Options and Rights to eligible
participants who are Officers or Directors of the
Company, the Plan shall be administered by (A) the Board,
if the Board may administer the Plan in compliance with
Rule 16b-3 as it applies to a plan intended to qualify
thereunder as a discretionary grant or award plan, or (B)
a Committee designated by the Board to administer the
Plan, which Committee shall be constituted (1) in such a
manner as to permit the Plan to comply with Rule 16b-3 as
it applies to a plan intended to qualify thereunder as a
discretionary grant or award plan and (2) in such a
manner as to satisfy the Applicable Laws.
(iii) Administration with respect to Other Persons. With
respect to grants of Options to eligible participants who
are neither Directors nor Officers of the Company, the
Plan shall be administered by (A) the Board or (B) a
Committee designated by the Board, which Committee shall
be constituted in such a manner as to satisfy the
Applicable Laws.
15
(iv) General. Once a Committee has been appointed pursuant to
subsection (ii) or (iii) of this Section 8(a), such
Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. From time
to time the Board may increase the size of any Committee
and appoint additional members thereof, remove members
(with or without cause) and appoint new members in
substitution therefor, fill vacancies (however caused)
and remove all members of a Committee and thereafter
directly administer the Plan, all to the extent permitted
by the Applicable Laws and, in the case of a Committee
appointed under subsection (ii), to the extent permitted
by Rule 16b-3 as it applies to a plan intended to qualify
thereunder as a discretionary grant or award plan.
(b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:
(i) to determine the Fair Market Value of the Common Stock,
in accordance with Section 2(n) of the Plan;
(ii) to select the Consultants and Employees to whom Options
and Rights may be granted hereunder;
(iii) to determine whether and to what extent Options and
Rights or any combination thereof, are granted hereunder;
(iv) to determine the number of shares of Common Stock to be
covered by each Option and Right granted hereunder;
(v) to approve forms of agreement for use under the Plan;
(vi) to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any award granted
hereunder. Such terms and conditions include, but are not
limited to, the exercise price, the time or times when
Options or Rights may be exercised (which may be based on
performance
16
criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or
limitation regarding any Option or Right or the shares of
Common Stock relating thereto, based in each case on such
factors as the Administrator, in its sole discretion,
shall determine;
(vii) to construe and interpret the terms of the Plan;
(viii) to prescribe, amend and rescind rules and regulations
relating to the Plan;
(ix) to determine whether and under what circumstances an
Option or Right may be settled in cash instead of Common
Stock or Common Stock instead of cash;
(x) to reduce the exercise price of any Option or Right;
(xi) to modify or amend each Option or Right (subject to
Section 16 of the Plan);
(xii) to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an
Option or Right previously granted by the Administrator;
(xiii) to institute an Option Exchange Program;
(xiv) to determine the terms and restrictions applicable to
Options and Rights and any Restricted Stock; and
(xv) to make all other determinations deemed necessary or
advisable for administering the Plan.
(c) Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options or Rights.
9. Transferability of Options. Unless otherwise determined by the
Administrator to the contrary, Options and Rights may not be sold, pledged,
assigned, hypothecated, transferred or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee. The Administrator may, in the
manner established by the Administrator, provide for the transfer of a
Nonstatuatory Stock Option by the Optionee to any member of the Optionee's
immediate family. In such case, the Nonstatutory Stock Option shall be
17
exercisable only by such transferee. Following transfer, any such Nonstatutory
Stock Options shall continue to be subject to the same terms and conditions as
were applicable immediately prior to the transfer. For purposes of this Section,
an Optionee's "immediate family" shall mean any of the following who have
acquired the Option from the Optionee through a gift or domestic relations
order: a child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, trusts for
the exclusive benefit of these persons and any other entity owned solely by
these persons, and such other persons and entities as shall be eligible to be
included as transferees in the Form S-8 Registration Statement under the
Securities Act of 1933, as amended, filed or to be filed by the Company to
register shares of Common Stock to be issued upon the exercise of Options
granted pursuant to the Plan.
10. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
(a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and Right, and the number of shares of Common Stock
which have been authorized for issuance under the Plan but as to which no
Options or Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Right, as well as the price per
share of Common Stock covered by each such outstanding Option or Right, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration." Such adjustment shall be
made by the Board, whose determination in that respect shall be final, binding
and conclusive. Except as expressly provided herein, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, shall affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock subject to an
Option or Right.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, to the extent that an Option or Right
has not been previously exercised, it will terminate immediately prior to the
consummation of such proposed action. The Board may, in the exercise of its sole
discretion in such instances, declare that any Option or Right shall terminate
as of a date fixed by the Board and give each Optionee the right to exercise his
18
or her Option or Right as to all or any part of the Optioned Stock, including
Shares as to which the Option or Right would not otherwise be exercisable.
(c) Merger or Asset Sale. In the event of a merger of the Company
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option and Right shall be assumed or an
equivalent Option or Right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation. In the event that the successor
corporation does not agree to assume the Option or to substitute an equivalent
option, the Administrator shall, in lieu of such assumption or substitution,
provide for the Optionee to have the right to exercise the Option or Right as to
all or a portion of the Optioned Stock, including Shares as to which it would
not otherwise be exercisable. If the Administrator makes an Option or Right
exercisable in lieu of assumption or substitution in the event of a merger or
sale of assets, the Administrator shall notify the Optionee that the Option or
Right shall be exercisable for a period of not less than fifteen (15) days from
the date of such notice, and the Option or Right will terminate upon the
expiration of such period. For the purposes of this paragraph, the Option or
Right shall be considered assumed if, immediately following the merger or sale
of assets, the Option or Right confers the right to purchase, for each Share of
Optioned Stock subject to the Option or Right immediately prior to the merger or
sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the merger or sale of assets was not solely
common stock of the successor corporation or its Parent, the Administrator may,
with the consent of the successor corporation and the participant, provide for
the consideration to be received upon the exercise of the Option or Right, for
each Share of Optioned Stock subject to the Option or Right, to be solely common
stock of the successor corporation or its Parent equal in Fair Market Value to
the per share consideration received by holders of Common Stock in the merger or
sale of assets.
11. Date of Grant. The date of grant of an Option or Right shall be, for
all purposes, the date on which the Administrator makes the determination
granting such Option or Right, or such other later date as is determined by the
Administrator. Notice of the determination shall be provided to each Optionee
within a reasonable time after the date of such grant.
12. Conditions Upon Issuance of Shares.
(a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option or Right unless the exercise of such Option or Right and
the issuance and delivery of such Shares shall comply with all relevant
19
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder,
Applicable Laws, and the requirements of any stock exchange or quotation system
upon which the Shares may then be listed or quoted, and shall be further subject
to the approval of counsel for the Company with respect to such compliance.
(b) Investment Representations. As a condition to the exercise of an
Option or Right, the Company may require the person exercising such Option or
Right to represent and warrant at the time of any such exercise that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required.
13. Liability of Company.
(a) Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.
(b) Grants Exceeding Allotted Shares. If the Optioned Stock covered
by an Option or Right exceeds, as of the date of grant, the number of Shares
which may be issued under the Plan without additional stockholder approval, such
Option or Right shall be void with respect to such excess Optioned Stock, unless
stockholder approval of an amendment sufficiently increasing the number of
Shares subject to the Plan is timely obtained in accordance with Section 16(b)
of the Plan.
14. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
15. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be obtained
in the manner and to the degree required under applicable federal and state law.
16. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan.
20
(b) Stockholder Approval. The Company shall obtain stockholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Rule 16b-3 or with Section 422 of the Code (or any successor rule or
statute or other applicable law, rule or regulation, including the requirements
of any exchange or quotation system on which the Common Stock is listed or
quoted). Such stockholder approval, if required, shall be obtained in such a
manner and to such a degree as is required by the applicable law, rule or
regulation.
(c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
17. Taxation Upon Exercise of Option or Right. At the discretion of the
Administrator, Optionees may satisfy withholding obligations as provided in this
Section 17. When an Optionee incurs tax liability in connection with an Option
or Right, which tax liability is subject to withholding under applicable tax
laws, the Optionee may satisfy the tax withholding obligation by one or some
combination of the following methods: (a) by cash payment, or (b) out of
Optionee's current compensation, or (c) by surrendering to the Company Shares
which (i) in the case of Shares previously acquired from the Company, have been
owned by the Optionee for more than six months on the date of surrender, and
(ii) have a fair market value on the date of surrender equal to or less than
Optionee's marginal tax rate times the ordinary income recognized, or (d) by
electing to have the Company withhold from the Shares to be issued upon exercise
of the Option or Right that number of Shares having a fair market value equal to
the amount required to be withheld. For this purpose, the fair market value of
the Shares to be withheld shall be determined on the date that the amount of tax
to be withheld is to be determined (the "Tax Date").
If the Optionee is an Insider, any surrender of previously owned Shares
to satisfy tax withholding obligations arising upon exercise of this Option must
comply with the applicable provisions of Rule 16b-3 and shall be subject to such
additional conditions or restrictions as may be required thereunder to qualify
for the maximum exemption from Section 16 of the Exchange Act with respect to
Plan transactions.
All elections by an Optionee to have Shares withheld to satisfy tax
withholding obligations shall be made in writing in a form acceptable to the
Administrator and shall be subject to the following restrictions:
(a) the election must be made on or prior to the applicable Tax
Date;
21
(b) once made, the election shall be irrevocable as to the
particular Shares of the Option as to which the election is made;
(c) all elections shall be subject to the consent or disapproval of
the Administrator;
(d) if the Optionee is an Insider, the election must comply with the
applicable provisions of Rule 16b-3 and shall be subject to such additional
conditions or restrictions as may be required thereunder to qualify for the
maximum exemption from Section 16 of the Exchange Act with respect to Plan
transactions.
In the event the election to have Shares withheld is made by an
Optionee and the Tax Date is deferred under Section 83 of the Code because no
election is filed under Section 83(b) of the Code, the Optionee shall receive
the full number of Shares with respect to which the Option is exercised but such
Optionee shall be unconditionally obligated to tender back to the Company the
proper number of Shares on the Tax Date.
18. Term of the Plan. The Plan shall expire, and no further Options shall
be granted pursuant to the Plan, on April 25, 2001.
19. Tax and Social Security Indemnity. An Optionee shall indemnify the
Company against any tax arising in respect of the grant or exercise of an Option
or Right which is a liability of the Optionee but for which the Company is
required to account under the laws of any relevant territory. The Company may
recover the tax from the Optionee in such manner as the Administrator deems
appropriate, including (but without prejudice to the generality of the
foregoing):
(a) withholding shares upon the exercise of the Option and selling
the same;
(b) deducting the necessary amount from the Optionee's compensation;
or
(c) requiring the Optionee to make cash payment to the Company for
such tax.
20. Options Granted to Employees of French Subsidiaries.
(a) Purpose. Options granted under the Plan to Employees of French
subsidiaries are intended to qualify under the French regulations as provided in
articles 208-1 to 208-8-2 of the French Company Act (Code des Societes). The
purpose of this Section is to specify the applicable rules to Options for French
Employees and shall not be applicable to any other Employee of the Company.
22
(b) General. Options granted to French Employees under the Plan are
subject to the provisions of the Plan and any option agreement unless otherwise
provided in this Section 20.
(c) Eligible Participants. Options may be granted exclusively to
Employees of French subsidiaries as (defined in Section 2(l)) of the Plan.
Payment of Director fees by the Company shall not be sufficient to constitute
employment for any purposes of the Options granted to Employees of French
subsidiaries. Employees of French subsidiaries may not be granted Options if, at
the date of grant, they hold more than ten percent (10%) of the Common Stock of
the Company. Section 5(a)(iv)(2) shall not apply to the grant of Options to
French employees.
(d) Options. Eligible Employees may be granted options as provided
in Section 5(a) of the Plan. If rights or awards mentioned in Section 5(b)
(Stock Appreciation Rights), Section 6 (Stock Purchase Rights) and Section 7
(Long-Term Performance Awards) of the Plan are granted to Employees of French
subsidiaries, the provisions of this Section shall not apply to the Stock
Appreciation Rights, Stock Purchase Rights and Long-Term Performance Awards
granted.
(e) Option Price. The exercise price of the Option shall be
determined as set forth in the Plan but it shall not be less than 80% of the
average Fair Market Value of the Common Stock during the twenty (20) market
trading days prior to the date of the grant. The exercise price shall remain
unchanged once the Option is granted. The authority of Administrator to reduce
the Option exercise price, as set forth in Section 8(b)(x) of the Plan, shall,
with respect to Options granted to Employees of French subsidiaries, be limited
to the extend that such reduction may not be to a price less than 80% of the
average Fair Market Value of the Common Stock during the twenty (20) market
trading days prior to the date of such reduction.
(f) Exercise of the Option. Upon exercise of an Option, Employees of
French subsidiaries will receive Shares of Common Stock. Section 8(b)(ix) of the
Plan, concerning the ability to settle the Option in cash instead of Shares of
Common Stock, is not applicable to Employees of French subsidiaries.
(g) Qualification of Plan. In order to have the Plan qualify in
France, any other provision of the Plan that would not be consistent with French
company law or tax law requirements shall not apply to Employees of French
subsidiaries.
23
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 4/25/01 | | 22 |
| Filed on: | | 12/22/99 | | | | | | | DEF 14A |
| | 10/12/99 | | 1 |
| For Period End: | | 9/30/99 |
| List all Filings |
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