Registration of Securities to be Offered to Employees Pursuant to an Employee Benefit Plan — Form S-8
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-8 Dxp Enterprises, Inc. 6 38K
2: EX-4.1 Restated Articles of Incorporation 17 59K
3: EX-4.3 Form of Common Stock Certificate 2 11K
4: EX-4.4 Dxp Enterprises, Inc. Long Term Incentive Plan 16 60K
5: EX-5.1 Opinion of Fulbright & Jaworski L.L.P. 2± 8K
6: EX-23.1 Consent of Arthur Andersen LLP 1 5K
EX-4.4 — Dxp Enterprises, Inc. Long Term Incentive Plan
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EXHIBIT 4.4
INDEX, INC.
LONG-TERM INCENTIVE PLAN
ARTICLE I: GENERAL
SECTION 1.1 Purpose of the Plan. The Long-Term Incentive Plan (the
"Plan") of Index, Inc. (the "Company") is intended to advance the best interests
of the Company, its subsidiaries and its shareholders in order to attract,
retain and motivate key employees by providing them with additional incentives
through (i) the grant of options ("Options") to purchase shares of Common Stock,
par value $.01 per share, of the Company ("Common Stock"), (ii) the grant of
stock appreciation rights ("Stock Appreciation Rights"), (iii) the award of
shares of restricted Common Stock ("Restricted Stock") and (iv) the award of
units payable in cash or shares of Common Stock based on performance
("Performance Awards"), thereby increasing the personal stake of such key
employees in the continued success and growth of the Company.
SECTION 1.2 Administration of the Plan. (a) The Plan shall be
administered by the Board of Directors of the Company or the compensation
committee of the Board of Directors or other designated committee of the Board
of Directors of the Company (the "Board of Directors") which shall consist of at
least two Outside Directors (the Board of Directors or such committee being
hereinafter referred to as the "Committee"). The Committee shall have authority
to interpret conclusively the provisions of the Plan, to adopt such rules and
regulations for carrying out the Plan as it may deem advisable, to decide
conclusively all questions of fact arising in the application of the Plan, to
establish performance criteria in respect of Awards (as defined herein) under
the Plan, to certify that Plan requirements have been met for any participant in
the Plan, to submit such matters as it may deem advisable to the Company's
shareholders for their approval, and to make all other determinations and take
all other actions necessary or desirable for the administration of the Plan. The
Committee is expressly authorized to adopt rules and regulations limiting or
eliminating its discretion in respect of certain matters as it may deem
advisable to comply with or obtain preferential treatment under any applicable
tax or other law rule, or regulation. All decisions and acts of the Committee
shall be final and binding upon all affected Plan participants.
For purposes of this Plan, "Outside Director" shall mean a nonemployee
director of the Company who is a "Non-Employee Director" within the meaning of
Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
(b) The Committee shall designate the eligible employees, if any, to be
granted Awards and the type and amount of such Awards and the time when Awards
will be granted. All Awards granted under the Plan shall be on the terms and
subject to the conditions determined by the Committee consistent with the Plan.
SECTION 1.3 Eligible Participants. Key employees, including officers,
of the Company and its subsidiaries (all such subsidiaries being referred to as
"Subsidiaries") shall be eligible for Awards under the Plan.
SECTION 1.4 Awards Under the Plan. Awards to key employees may be in
the form of (i) Options, (ii) Stock Appreciation Rights, which may be issued
independent of or in tandem with Options, (iii) shares of Restricted Stock, (iv)
Performance Awards, or (v) any combination of the foregoing (collectively,
"Awards").
SECTION 1.5 Shares Subject to the Plan. Initially, the aggregate number
of shares of Common Stock that may be issued under the Plan shall be 800,000. In
addition, as of January 1 of each year the Plan is in effect, if the total
number of shares of Common Stock issued and outstanding, not including any
shares issued under the Plan, exceeds the total number of shares of Common Stock
issued and outstanding as of January 1 of the preceding year (or, for 1996, as
of the effective date of the merger (the "Effective Date") of a wholly owned
subsidiary of the Company with SEPCO Industries, Inc. (the "Sepco Merger")
assuming all shares issued pursuant to the Sepco Merger and the proposed merger
of a subsidiary of the Company with and into Newman Communications, Inc are
issued), the number of shares available will be increased by an amount such that
the total number of shares that may be issued under the Plan shall be increased
by an amount such that the total number of shares of Common Stock available for
issuance under the Plan equals 5% of the total number of shares of Common Stock
outstanding, not including any shares issued under the Plan. Shares distributed
pursuant to the Plan may consist of authorized but unissued shares or treasury
shares of the Company, as shall be determined from time to time by the Board of
Directors.
If any Award under the Plan shall expire, terminate or be cancelled
(including cancellation upon an Option holder's exercise of a related Stock
Appreciation Right) for any reason without having been exercised in full, or if
any Award shall be forfeited to the Company, the unexercised or forfeited Award
shall not count against the above limits and shall again become available for
Awards under the Plan (unless the holder of such Award received dividends or
other economic benefits with respect to such Award, which dividends or other
economic benefits are not forfeited, in which case the Award shall count against
the above limits). Shares of Common Stock equal in number to the shares
surrendered in payment of the option price, and shares of Common Stock which are
withheld in order to satisfy Federal, state or local tax liability, shall count
against the above limits. Only the number of shares of Common Stock actually
issued upon exercise of a Stock Appreciation Right shall count against the above
limits, and any shares which were estimated to be used for such purposes and
were not in fact so used shall again become available for Awards under the Plan.
Cash exercises of Stock Appreciation Rights and cash settlement of other Awards
will not count against the above limits.
The aggregate number of shares of Common Stock subject to Options or
Stock Appreciation Rights that may be granted to any one participant in any one
year under the Plan shall be 400,000. The aggregate number of shares of Common
Stock that may be granted to any one participant in any one year in respect of
Restricted Stock shall be 400,000. The aggregate number of shares of Common
Stock that may be received by any one participant in any one year in respect of
a Performance Award shall be 400,000 and the aggregate amount of cash that may
be received by any one participant in any one year in respect to a Performance
Award shall be $500,000.
The total number of Awards (or portions thereof) settled in cash under
the Plan, based on the number of shares covered by such Awards (e.g., 100 shares
for a Stock Appreciation Right with respect to 100 shares), shall not exceed a
number equal to (i) the number of shares
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initially available for issuance under the Plan plus (ii) the number of shares
that have become available for issuance under the Plan pursuant to the first
paragraph of this Section 1.5.
The aggregate number of shares of Common Stock that are available under
the Plan for Options granted in accordance with Section 2.4(i) ("ISOs") is
800,000, subject to adjustments as provided in Section 5.2 of the Plan.
SECTION 1.6 Other Compensation Programs. Nothing contained in the Plan
shall be construed to preempt or limit the authority of the Board of Directors
to exercise its corporate rights and powers, including, but not by way of
limitation, the right of the Board of Directors (i) to grant incentive awards
for proper corporate purposes otherwise than under the Plan to any employee,
officer, director or other person or entity or (ii) to grant incentive awards
to, or assume incentive awards of, any person or entity in connection with the
acquisition (whether by purchase, lease, merger, consolidation or otherwise) of
the business or assets (in whole or in part) of any person or entity.
ARTICLE II: STOCK OPTIONS AND STOCK APPRECIATION RIGHTS
SECTION 2.1 Terms and Conditions of Options. Subject to the following
provisions, all Options granted under the Plan to employees of the Company and
its Subsidiaries shall be in such form and shall have such terms and conditions
as the Committee, in its discretion, may from time to time determine consistent
with the Plan.
(a) Option Price. The option price per share shall be determined by the
Committee, except that in the case of an Option granted in accordance with
Section 2.4(i) the option price per share shall not be less than the fair market
value of a share of Common Stock (as determined by the Committee) on the date
the Option is granted (other than in the case of substitute or assumed Options
to the extent required to qualify such Options for preferential tax treatment
under the Code as in effect at the time of such grant).
(b) Term of Option. The term of an Option shall be determined by the
Committee, except that in the case of an ISO the term of the Option shall not
exceed ten years from the date of grant, and, notwithstanding any other
provision of this Plan, no Option shall be exercised after the expiration of its
term.
(c) Exercise of Options. Options shall be exercisable at such time or
times and subject to such terms and conditions as the Committee shall specify in
the Option grant. Unless the Option grant specifies otherwise, the Committee
shall have discretion at any time to accelerate such time or times and otherwise
waive or amend any conditions in respect of all or any portion of the Options
held by any optionee. An Option may be exercised in accordance with its terms as
to any or all shares purchasable thereunder.
(d) Payment for Shares. The Committee may authorize payment for shares
as to which an Option is exercised to be made in cash, shares of Common Stock, a
combination thereof, by "cashless exercise" or in such other manner as the
Committee in its discretion may provide.
(e) Shareholder Rights. The holder of an Option shall, as such, have
none of the rights of a shareholder.
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(f) Termination of Employment. The Committee shall have discretion to
specify in the Option grant, or, with the consent of the optionee, an amendment
thereof, provisions with respect to the period, not extending beyond the term of
the Option, during which the Option may be exercised following the optionee's
termination of employment.
SECTION 2.2 Stock Appreciation Rights in Tandem with Options. (a) The
Committee may, either at the time of grant of an Option or at any time during
the term of the Option, grant Stock Appreciation Rights ("Tandem SARs") with
respect to all or any portion of the shares of Common Stock covered by such
Option. A Tandem SAR may be exercised at any time the Option to which it relates
is then exercisable, but only to the extent the Option to which it relates is
exercisable, and shall be subject to the conditions applicable to such Option.
When a Tandem SAR is exercised, the Option to which it relates shall cease to be
exercisable to the extent of the number of shares with respect to which the
Tandem SAR is exercised. Similarly, when an Option is exercised, the Tandem SARs
relating to the shares covered by such Option exercise shall terminate. Any
Tandem SAR which is outstanding on the last day of the term of the related
Option (as determined pursuant to Section 2.1(b)) shall be automatically
exercised on such date for cash without any action by the optionee.
(b) Upon exercise of a Tandem SAR, the holder shall receive, for each
share with respect to which the Tandem SAR is exercised, an amount (the
"Appreciation") equal to the difference between the option price per share of
the Option to which the Tandem SAR relates and the fair market value (as
determined by the Committee) of a share of Common Stock on the date of exercise
of the Tandem SAR. The Appreciation shall be payable in cash, Common Stock, or a
combination of both, at the option of the Committee, and shall be paid within 30
days of the exercise of the Tandem SAR.
SECTION 2.3 Stock Appreciation Rights Independent of Options. Subject
to the following provisions, all Stock Appreciation Rights granted independent
of Options ("Independent SARs") under the Plan to employees of the Company and
its Subsidiaries shall be in such form and shall have such terms and conditions
as the Committee, in its discretion, may from time to time determine consistent
with the Plan.
(a) Exercise Price. The exercise price per share shall be determined by
the Committee on the date the Independent SAR is granted.
(b) Term of Independent SAR. The term of an Independent SAR shall be
determined by the Committee, and, notwithstanding any other provision of this
Plan, no Independent SAR shall be exercised after the expiration of its term.
(c) Exercise of Independent SARs. Independent SARs shall be exercisable
at such time or times and subject to such terms and conditions as the Committee
shall specify in the Independent SAR grant. Unless the Independent SAR grant
specifies otherwise, the Committee shall have discretion at any time to
accelerate such time or times and otherwise waive or amend any conditions in
respect of all or any portion of the Independent SARs held by any participant.
Upon exercise of an Independent SAR, the holder shall receive, for each share
specified in the Independent SAR grant, an amount (the "Appreciation") equal to
the difference between the exercise price per share specified in the Independent
SAR grant and the fair market value (as determined by the Committee) of a share
of Common Stock on the date of exercise of the Independent SAR. The Appreciation
shall be payable in cash, Common Stock,
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or a combination of both, at the option of the Committee, and shall be paid
within 30 days of the exercise of the Independent SAR.
(d) Shareholder Rights. The holder of an Independent SAR shall, as
such, have none of the rights of a shareholder.
(e) Termination of Employment. The Committee shall have discretion to
specify in the Independent SAR grant, or, with the consent of the holder, an
amendment thereof, provisions with respect to the period, not extending beyond
the term of the Independent SAR, during which the Independent SAR may be
exercised following the holder's termination of employment.
SECTION 2.4 Statutory Options. Subject to the limitations on Option
terms set forth in Section 2.1, the Committee shall have the authority to grant
(i) ISOs within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code"), and (ii) Options containing such terms and conditions
as shall be required to qualify such Options for preferential tax treatment
under the Code as in effect at the time of such grant, including, if then
applicable, limits with respect to minimum exercise price, duration and amounts
and special limitations applicable to any 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 the Company or any affiliate. Options granted
pursuant to this Section 2.4 may contain such other terms and conditions
permitted by Article II of this Plan as the Committee, in its discretion, may
from time to time determine (including, without limitation, provision for Stock
Appreciation Rights), to the extent that such terms and conditions do not cause
the Options to lose their preferential tax treatment. If an Option intended to
be an ISO ceases or is otherwise not eligible to be an ISO, such Option (or
portion thereof necessary to maintain the status of the remaining portion of the
Option as an ISO) shall remain valid but be treated as an Option other than an
ISO.
SECTION 2.5 Change of Control. Notwithstanding the exercisability
schedule governing any Option or Stock Appreciation Right, upon the occurrence
of a Change of Control (as defined in Section 5.9) all Options and Stock
Appreciation Rights outstanding at the time of such Change of Control and held
by participants who are employees of the Company or its subsidiaries at the time
of such Change of Control shall (unless specifically provided otherwise in the
grant thereof) become immediately exercisable and, unless the participant agrees
otherwise in writing, remain exercisable for three years (but not beyond the
term of the Option or Stock Appreciation Right) after the employee's termination
of employment for any reason other than termination by the Company or a
subsidiary of the Company for dishonesty, conviction of a felony, wilful
unauthorized disclosure of confidential information or wilful refusal to perform
the duties of such employee's position or positions with the Company or such
subsidiary (termination for "cause"); provided that this Section 2.5 shall not
apply to Awards granted to a participant if, in connection with a Change of
Control pursuant to clause (1) of Section 5.9, such participant is the Person or
forms part of the Person specified in such clause (1).
ARTICLE III: RESTRICTED STOCK
SECTION 3.1 Terms and Conditions of Restricted Stock Awards. Subject to
the following provisions, all Awards of Restricted Stock under the Plan to
employees of the Company and
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its Subsidiaries shall be in such form and shall have such terms and conditions
as the Committee, in its discretion, may from time to time determine consistent
with the Plan.
(a) Restricted Stock Award. The Restricted Stock Award shall specify
the number of shares of Restricted Stock to be awarded, the price, if any, to be
paid by the recipient of the Restricted Stock, and the date or dates on which
the Restricted Stock will vest. The vesting and number of shares of Restricted
Stock may be conditioned upon the completion of a specified period of service
with the Company or its Subsidiaries, upon the attainment of specified
performance objectives, or upon such other criteria as the Committee may
determine in accordance with the provisions hereof. Performance objectives will
be based on increases in share prices, operating income, margin, sales increases
on a Company wide, division, product line or other basis, net income before or
after taxes or before or after extraordinary charges, completions of successful
acquisitions, implementation of strategic expansions, net income or cash flow
thresholds, return on common equity or any combination of the foregoing.
(b) Restrictions on Transfer. Stock certificates representing the
Restricted Stock granted to an employee may be registered in the employee's name
or held by the Company prior to the achievement of certain criteria. Such
certificates shall either be held by the Company on behalf of the employee, or
delivered to the employee bearing a legend to restrict transfer of the
certificate until the Restricted Stock has vested, as determined by the
Committee. The Committee shall determine whether the employee shall have the
right to vote and/or receive dividends on the Restricted Stock before it has
vested. No share of Restricted Stock may be sold, transferred, assigned, or
pledged by the employee until such share has vested in accordance with the terms
of the Restricted Stock Award. Unless the grant of a Restricted Stock Award
specifies otherwise, in the event of an employee's termination of employment
before all the employee's Restricted Stock has vested, or in the event other
conditions to the vesting of Restricted Stock have not been satisfied prior to
any deadline for the satisfaction of such conditions set forth in the Award, the
shares of Restricted Stock that have not vested shall be forfeited and any
purchase price paid by the employee shall be returned to the employee. At the
time Restricted Stock vests (and, if the employee has been issued legended
certificates of Restricted Stock, upon the return of such certificates to the
Company), a certificate for such vested shares shall be delivered to the
employee or the employee's estate, free of all restrictions.
(c) Accelerated Vesting. Notwithstanding the vesting conditions set
forth in the Restricted Stock Award, (i) unless the Restricted Stock grant
specifies otherwise, the Committee may in its discretion at any time accelerate
the vesting of Restricted Stock or otherwise waive or amend any conditions of a
grant of Restricted Stock, and (ii) all shares of Restricted Stock shall vest
upon a Change of Control of the Company; provided that clause (ii) above shall
not apply to Awards granted to a participant if, in connection with a Change of
Control pursuant to clause (1) of Section 5.9, such participant is the Person or
forms part of the Person specified in such clause (1).
ARTICLE IV: PERFORMANCE AWARDS
SECTION 4.1 Terms and Conditions of Performance Awards. The Committee
shall be authorized to grant Performance Awards, which are payable in stock,
cash or a combination thereof, at the discretion of the Committee.
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(a) Performance Period. The Committee shall establish with respect to
each Performance Award a performance period over which the performance goal of
such Performance Award shall be measured. The performance period for a
Performance Award shall be established prior to the time such Performance Award
is granted and may overlap with performance periods relating to other
Performance Awards granted hereunder to the same employee.
(b) Performance Objectives. The Committee shall establish a minimum
level of acceptable achievement for the holder at the time of each Award. Each
Performance Award shall be contingent upon future performances and achievement
of objectives described either in terms of Company-wide performance or in terms
that are related to performance of the employee or of the division, subsidiary,
department or function within the Company in which the employee is employed. The
Committee shall have the authority to establish the specific performance
objectives and measures applicable to such objectives. Such objectives, however,
shall be based on increases in share prices, operating income, margin, sales
increases on a Company wide, division, product line or other basis, net income
before or after taxes or before or after extraordinary charges, completions of
successful acquisitions, implementation of strategic expansions, net income or
cash flow thresholds, return on common equity or any combination of the
foregoing.
(c) Size, Frequency and Vesting. The Committee shall have the authority
to determine at the time of the Award the maximum value of a Performance Award,
the frequency of Awards and the date or dates when Awards vest.
(d) Payment. Following the end of each performance period, the holder
of each Performance Award will be entitled to receive payment of an amount, not
exceeding the maximum value of the Performance Award, based on the achievement
of the performance measures for such performance period, as determined by the
Committee. If at the end of the performance period the specified objectives have
been attained, the employee shall be deemed to have fully earned the Performance
Award. If the employee exceeds the specified minimum level of acceptable
achievement but does not fully attain such objectives, the employee shall be
deemed to have partly earned the Performance Award, and shall become entitled to
receive a portion of the total Award, as determined by the Committee. If a
Performance Award is granted after the start of a performance period, the Award
shall be reduced to reflect the portion of the performance period during which
the Award was in effect. Unless the Award specifies otherwise, including
restrictions in order to satisfy the conditions under Section 162(m) of the
Code, the Committee may adjust the payment of Awards or the performance
objectives if events occur or circumstances arise which would cause a particular
payment or set of performance objectives to be inappropriate, as determined by
the Committee.
(e) Termination of Employment. A recipient of a Performance Award who,
by reason of death, disability or retirement, terminates employment before the
end of the applicable performance period shall be entitled to receive, to the
extent earned, a portion of the Award which is proportional to the portion of
the performance period during which the employee was employed. A recipient of a
Performance Award who terminates employment for any other reason shall not be
entitled to any part of the Award unless the Committee determines otherwise;
however, the Committee may in no event pay the employee more than that portion
of the Award which is proportional to his or her period of actual service.
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(f) Accelerated Vesting. Notwithstanding the vesting conditions set
forth in a Performance Award, (i) unless the Award specifies otherwise, the
Committee may in its discretion at any time accelerate vesting of the Award or
otherwise waive or amend any conditions (including but not limited to
performance objectives) in respect of a Performance Award, and (ii) all
Performance Awards shall vest upon a Change of Control of the Company. In
addition, each participant in the Plan shall receive the maximum Performance
Award he or she could have earned for the proportionate part of the performance
period prior to the Change of Control, and shall retain the right to earn any
additional portion of his or her Award if he or she remains in the Company's
employ. However, clause (ii) above shall not apply to Awards granted to a
participant if, in connection with a Change of Control pursuant to clause (1) of
Section 5.9, such participant is the Person or forms part of the Person
specified in such clause (1).
(g) Shareholder Rights. The holder of a Performance Award shall, as
such, have none of the rights of a shareholder.
ARTICLE V: ADDITIONAL PROVISIONS
SECTION 5.1 General Restrictions. Each Award under the Plan shall be
subject to the requirement that, if at any time the Committee shall determine
that (i) the listing, registration or qualification of the shares of Common
Stock subject or related thereto upon any securities exchange or under any state
or Federal law, or (ii) the consent or approval of any government regulatory
body, or (iii) an agreement by the recipient of an Award with respect to the
disposition of shares of Common Stock, is necessary or desirable (in connection
with any requirement or interpretation of any Federal or state securities law,
rule or regulation) as a condition of, or in connection with, the granting of
such Award or the issuance, purchase or delivery of shares of Common Stock
thereunder, such Award may not be consummated in whole or in part unless such
listing, registration, qualification, consent, approval or agreement shall have
been effected or obtained free of any conditions not acceptable to the
Committee.
SECTION 5.2 Adjustments for Changes in Capitalization. In the event of
any stock dividends, stock splits, recapitalizations, combinations, exchanges of
shares, mergers, consolidation, liquidations, split-ups, split-offs, spin-offs,
or other similar changes in capitalization, or any distribution to shareholders,
including a rights offering, other than regular cash dividends, changes in the
outstanding stock of the Company by reason of any increase or decrease in the
number of issued shares of Common Stock resulting from a split-up or
consolidation of shares or any similar capital adjustment or the payment of any
stock dividend, any share repurchase at a price in excess of the market price of
the Common Stock at the time such repurchase is announced or other increase or
decrease in the number of such shares, the Committee shall make appropriate
adjustment in the number and kind of shares authorized by the Plan (including
shares available for ISOs), in the number, price or kind of shares covered by
the Awards and in any outstanding Awards under the Plan; provided, however, that
no such adjustment shall increase the aggregate value of any outstanding Award.
In the event of any adjustment in the number of shares covered by any
Award, any fractional shares resulting from such adjustment shall be disregarded
and each such Award shall cover only the number of full shares resulting from
such adjustment.
SECTION 5.3 Amendments. (a) The Board of Directors may at any time and
from time to time and in any respect amend or modify the Plan.
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(b) The Committee shall have the authority to amend any Award to
include any provision which, at the time of such amendment, is authorized under
the terms of the Plan; however, no outstanding Award may be revoked or altered
in a manner unfavorable to the holder without the written consent of the holder.
SECTION 5.4 Cancellation of Awards. Any Award granted under the Plan
may be cancelled at any time with the consent of the holder and a new Award may
be granted to such holder in lieu thereof, which Award may, in the discretion of
the Committee, be on more favorable terms and conditions than the cancelled
Award.
SECTION 5.5 Withholding. Whenever the Company proposes or is required
to issue or transfer shares of Common Stock under the Plan, the Company shall
have the right to require the holder to pay an amount in cash or to retain or
sell without notice, or demand surrender of, shares of Common Stock in value
sufficient to satisfy any Federal, state or local withholding tax liability
("Withholding Tax") prior to the delivery of any certificate for such shares (or
remainder of shares if Common Stock is retained to satisfy such tax liability).
Whenever under the Plan payments are to be made in cash, such payments shall be
net of an amount sufficient to satisfy any Federal, state or local withholding
tax liability.
Whenever Common Stock is so retained or surrendered to satisfy
Withholding Tax, the value of shares of Common Stock so retained or surrendered
shall be determined by the Committee, and the value of shares of Common Stock so
sold shall be the net proceeds (after deduction of commissions) received by the
Company from such sale, as determined by the Committee.
SECTION 5.6 Non-assignability. Except as expressly provided in the
Plan, no Award under the Plan shall be assignable or transferable by the holder
thereof except by will or by the laws of descent and distribution. During the
life of the holder, Awards under the Plan shall be exercisable only by such
holder or by the guardian or legal representative of such holder.
SECTION 5.7 Non-uniform Determinations. Determinations by the Committee
under the Plan (including, without limitation, determinations of the persons to
receive Awards; the form, amount and timing of such Awards; the terms and
provisions of such Awards and the agreements evidencing same; and provisions
with respect to termination of employment) 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.
SECTION 5.8 No Guarantee of Employment. The grant of an Award under the
Plan shall not constitute an assurance of continued employment for any period or
any obligation of the Board of Directors to nominate any director for reelection
by the Company's shareholders.
SECTION 5.9 Change of Control. A "Change of Control" shall be deemed to
have occurred if:
(1) any Person (as defined below), other than a Designated
Person, is or becomes the Beneficial Owner (as defined below) of
securities of the Company representing 35% or more of the Voting Power
(as defined below);
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(2) there shall occur a change in the composition of a
majority of the Board of Directors within any period of four
consecutive years which change shall not have been approved by a
majority of the Board of Directors as constituted immediately prior to
the commencement of such period;
(3) at any meeting of the shareholders of the Company called
for the purpose of electing directors, more than one of the persons
nominated by the Board of Directors for election as directors shall
fail to be elected; or
(4) the shareholders of the Company approve a merger,
consolidation, sale of substantially all assets or other reorganization
of the Company, other than a reincorporation, in which the Company does
not survive.
For purposes of this Section 5.9, (i) "Person" shall have the meaning
set forth in Sections 3(a)(9) and 13(d)(3) of the Securities Exchange Act of
1934, as in effect on August 15, 1996, (ii) "Beneficial Owner" shall have the
meaning set forth in Rules 13d-3 and 13d-5 promulgated under the Exchange Act on
August 15, 1996; (iii) "Voting Power" shall mean the voting power of the
outstanding securities of the Company having the right under ordinary
circumstances to vote at an election of the Board of Directors; and (iv)
"Designated Person" shall mean any Person who at the Effective Date is a
Beneficial Owner of 10% or more of the Common Stock or whose Beneficial
Ownership of securities is solely the result of such Person acquiring securities
as an underwriter in an underwritten public offering of such securities.
SECTION 5.10 Duration and Termination. (a) The Plan shall be of
unlimited duration. Notwithstanding the foregoing, no ISO (within the meaning of
Section 422 of the Code) shall be granted under the Plan ten (10) years after
the effective date of the Plan, but Awards granted prior to such date may extend
beyond such date, and the terms of this Plan shall continue to apply to all
Awards granted hereunder.
(b) The Board of Directors may suspend, discontinue or terminate the
Plan at any time. Such action shall not impair any of the rights of any holder
of any Award outstanding on the date of the Plan's suspension, discontinuance or
termination without the holder's written consent.
SECTION 5.11 Effective Date. The Plan shall be effective as of August
12, 1996, subject to the consummation of the Sepco Merger.
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AMENDMENT
TO
INDEX, INC.
LONG-TERM INCENTIVE PLAN
ADOPTED BY THE COMPENSATION COMMITTEE MAY 12, 1997
SECTION 1.5 of the Index, Inc. Long-Term Incentive Plan is hereby
amended and restated in its entirety as follows:
SECTION 1.5 Shares Subject to the Plan. Initially, the
aggregate number of shares of Common Stock that may be issued under the
Plan shall be 400,000. In addition, as of January 1 of each year the
Plan is in effect, if the total number of shares of Common Stock issued
and outstanding, not including any shares issued under the Plan,
exceeds the total number of shares of Common Stock issued and
outstanding as of January 1 of the preceding year (or, for 1996, as of
the effective date of the merger (the "Effective Date") of a wholly
owned subsidiary of the Company with SEPCO Industries, Inc. (the "Sepco
Merger") assuming all shares issued pursuant to the Sepco Merger and
the proposed merger of a subsidiary of the Company with and into Newman
Communications, Inc are issued), the number of shares available will be
increased by an amount such that the total number of shares that may be
issued under the Plan shall be increased by an amount such that the
total number of shares of Common Stock available for issuance under the
Plan equals 5% of the total number of shares of Common Stock
outstanding, not including any shares issued under the Plan. Shares
distributed pursuant to the Plan may consist of authorized but unissued
shares or treasury shares of the Company, as shall be determined from
time to time by the Board of Directors.
If any Award under the Plan shall expire, terminate or be
cancelled (including cancellation upon an Option holder's exercise of a
related Stock Appreciation Right) for any reason without having been
exercised in full, or if any Award shall be forfeited to the Company,
the unexercised or forfeited Award shall not count against the above
limits and shall again become available for Awards under the Plan
(unless the holder of such Award received dividends or other economic
benefits with respect to such Award, which dividends or other economic
benefits are not forfeited, in which case the Award shall count against
the above limits). Shares of Common Stock equal in number to the shares
surrendered in payment of the option price, and shares of Common Stock
which are withheld in order to satisfy Federal, state or local tax
liability, shall count against the above limits. Only the number of
shares of Common Stock actually issued upon exercise of a Stock
Appreciation Right shall count against the above limits, and any shares
which were estimated to be used for such purposes and were not in fact
so used shall again become available for Awards under the Plan. Cash
exercises of Stock Appreciation Rights and cash settlement of other
Awards will not count against the above limits.
The aggregate number of shares of Common Stock subject to
Options or Stock Appreciation Rights that may be granted to any one
participant in any one year under the Plan shall be 200,000. The
aggregate number of shares of Common Stock that may be granted to any
one participant in any one year in
respect of Restricted Stock shall be 200,000. The aggregate number of
shares of Common Stock that may be received by any one participant in
any one year in respect of a Performance Award shall be 200,000 and the
aggregate amount of cash that may be received by any one participant in
any one year in respect to a Performance Award shall be $500,000.
The total number of Awards (or portions thereof) settled in
cash under the Plan, based on the number of shares covered by such
Awards (e.g., 100 shares for a Stock Appreciation Right with respect to
100 shares), shall not exceed a number equal to (i) the number of
shares initially available for issuance under the Plan plus (ii) the
number of shares that have become available for issuance under the Plan
pursuant to the first paragraph of this Section 1.5.
The aggregate number of shares of Common Stock that are
available under the Plan for Options granted in accordance with Section
2.4(i) ("ISOs") is 400,000, subject to adjustments as provided in
Section 5.2 of the Plan.
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AMENDMENT
TO
INDEX, INC.
LONG-TERM INCENTIVE PLAN
ADOPTED BY THE BOARD OF DIRECTORS JANUARY 8, 1998
The first sentence of Section 1.5 of the Index, Inc. Long-Term
Incentive Plan is hereby replaced and amended to read as follows:
SECTION 1.5 Shares Subject to the Plan. The aggregate number
of shares of Common Stock that may be issued under the Plan shall be
660,000, of which 260,000 shares may not be issued pursuant to stock
options intended to qualify as incentive stock options within the
meaning of Section 422(b) of the Internal Revenue Code of 1986, as
amended, or pursuant to awards granted to executive officers of the
Company.
Amendment
to
Index, Inc.
Long-Term Incentive Plan
Adopted by the Board of Directors July 6, 1998
1. The name of the Index, Inc. Long-Term Incentive Plan, as amended
(the "Plan") is hereby changed to the DXP Enterprises, Inc. Long-Term Incentive
Plan.
2. Section 1.1 of the Plan is hereby amended and restated in its
entirety as follows:
SECTION 1.1 Purpose of the Plan. The Long-Term Incentive Plan
(the "Plan") of DXP Enterprises, Inc. (the "Company") is intended to
advance the best interests of the Company, its subsidiaries and its
shareholders in order to attract, retain and motivate key employees by
providing them with additional incentives through (i) the grant of
options ("Options") to purchase shares of Common Stock, par value $.01
per share, of the Company ("Common Stock"), (ii) the grant of stock
appreciation rights ("Stock Appreciation Rights"), (iii) the award of
shares of restricted Common Stock ("Restricted Stock") and (iv) the
award of units payable in cash or shares of Common Stock based on
performance ("Performance Awards"), thereby increasing the personal
stake of such key employees in the continued success and growth of the
Company.
AMENDMENT
TO
DXP ENTERPRISES, INC.
LONG-TERM INCENTIVE PLAN
ADOPTED BY THE COMPENSATION COMMITTEE JULY 17, 1998
Section 1.5 of the DXP Enterprises, Inc. Long-Term Incentive Plan, as
amended, is hereby amended and restated in its entirety as follows:
SECTION 1.5 Shares Subject to the Plan. The aggregate number
of shares of Common Stock that may be issued under the Plan shall be
330,000, of which 130,000 shares may not be issued pursuant to stock
options intended to qualify as incentive stock options within the
meaning of Section 422(b) of the Internal Revenue Code of 1986, as
amended, or pursuant to awards granted to executive officers of the
Company. In addition, as of January 1 of each year the Plan is in
effect, if the total number of shares of Common Stock issued and
outstanding, not including any shares issued under the Plan, exceeds
the total number of shares of Common Stock issued and outstanding as of
January 1 of the preceding year (or, for 1996, as of the effective date
of the merger (the "Effective Date") of a wholly owned subsidiary of
the Company with SEPCO Industries, Inc. (the "Sepco Merger") assuming
all shares issued pursuant to the Sepco Merger and the proposed merger
of a subsidiary of the Company with and into Newman Communications,
Inc. are issued), the number of shares available will be increased by
an amount such that the total number of shares that may be issued under
the Plan shall be increased by an amount such that the total number of
shares of Common Stock available for issuance under the Plan equals 5%
of the total number of shares of Common Stock outstanding, not
including any shares issued under the Plan. Shares distributed pursuant
to the Plan may consist of authorized but unissued shares or treasury
shares of the Company, as shall be determined from time to time by the
Board of Directors.
If any Award under the Plan shall expire, terminate or be
cancelled (including cancellation upon an Option holder's exercise of a
related Stock Appreciation Right) for any reason without having been
exercised in full, or if any Award shall be forfeited to the Company,
the unexercised or forfeited Award shall not count against the above
limits and shall again become available for Awards under the Plan
(unless the holder of such Award received dividends or other economic
benefits with respect to such Award, which dividends or other economic
benefits are not forfeited, in which case the Award shall count against
the above limits). Shares of Common Stock equal in number to the shares
surrendered in payment of the option price, and shares of Common Stock
which are withheld in order to satisfy Federal, state or local tax
liability, shall count against the above limits. Only the number of
shares of Common Stock actually issued upon exercise of a Stock
Appreciation Right shall count against the above limits, and any shares
which were estimated to be used for such purposes and were not in fact
so used shall again become available for Awards under the Plan. Cash
exercises of Stock Appreciation Rights and cash settlement of other
Awards will not count against the above limits.
The aggregate number of shares of Common Stock subject to
Options or Stock Appreciation Rights that may be granted to any one
participant in any one year under the Plan shall be 100,000. The
aggregate number of shares of Common Stock that may be granted to any
one participant in any one year in respect of Restricted Stock shall be
100,000. The aggregate number of shares of Common Stock that may be
received by any one participant in any one year in respect of a
Performance Award shall be 100,000 and the aggregate amount of cash
that may be received by any one participant in any one year in respect
to a Performance Award shall be $500,000.
The total number of Awards (or portions thereof) settled in
cash under the Plan, based on the number of shares covered by such
Awards (e.g., 100 shares for a Stock Appreciation Right with respect to
100 shares), shall not exceed a number equal to (i) the number of
shares initially available for issuance under the Plan plus (ii) the
number of shares that have become available for issuance under the Plan
pursuant to the first paragraph of this Section 1.5.
The aggregate number of shares of Common Stock that are
available under the Plan for Options granted in accordance with Section
2.4(i) ("ISOs") is 200,000, subject to adjustments as provided in
Section 5.2 of the Plan.
-2-
Dates Referenced Herein and Documents Incorporated by Reference
18 Subsequent Filings that Reference this Filing
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