wci_ex1001-80630.htm


    EXHIBIT 10.01

    
 

    WILLIAMS
CONTROLS, INC.

    RESTATED
1993 STOCK OPTION PLAN

     

    This
Williams Controls, Inc. Restated 1993 Stock Option Plan (this "Plan") is
intended to encourage stock ownership by employees, officers and directors
(whether or not they are employees) of and consultants to Williams Controls,
Inc. (the "Corporation"), its divisions, Subsidiary corporations and Parent
corporations, so that they may acquire or increase their proprietary interest in
the Corporation, which will enable the Corporation to (i) induce qualified
persons to become employees, officers or directors of, or consultants to, the
Corporation; (ii) reward employees, directors, and consultants for past
services to the Corporation; and (iii) encourage such persons to remain in
the employ of, or associated with, the Corporation and to put forth maximum
efforts for the success of the business of the Corporation.  This Plan
was originally adopted September 20, 1993, subsequently amended to increase
the number of shares available under this Plan, and is now being restated, in
its entirety, to incorporate various changes.

     

    It is
intended that options granted by the Committee pursuant to Section 5(a) of this
Plan shall constitute "incentive stock options" ("Incentive Stock options")
within the meaning of Section 422 of the Code, and options granted by the
Committee pursuant to Section 6(b) of this Plan shall constitute "non-qualified
stock options" ("Non-qualified Stock Options").

     

    1.           Definitions. As used in this
Plan, the following words and phrases shall have the meanings
indicated:

     

    (a)           "Board"
means the Board of Directors of the Corporation.

     

    (b)           "Code"
means Internal Revenue Code of 1986, as amended from to time.

     

    (c)           "Committee"
means the Compensation Committee appointed by the Board, if one has been
appointed. If no Committee has been appointed, the term "Committee" shall mean
the Board.

     

    (d)           "Common
Stock" mean the Corporation's $.01 par value common stock.

     

    (e)           "Disability"
means a Recipient's inability to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment that can be
expected to result in death or that has lasted or can be expected to last for a
continuous period of not less than 12 months, or such other meaning ascribed in
Section 22(e)(3) or any successor provision of the Code. If the Recipient has a
disability insurance policy, the term "Disability" shall be as defined therein;
provided that said definition is not inconsistent with the meaning ascribed in
Section 22(e)(3) or any successor provision of the Code.

     

    (f)           "Exchange
Act" means Securities Exchange Act of 1934, as amended from time to
time.

     

    
      
        
        

      

      
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    (g)           "Fair
Market Value" per share as of a particular date means the last sale price of the
Corporation's Common Stock as reported on a national securities exchange or on
the NASDAQ National Market System or, if the quotation for the last sale
reported is not available for the Corporation's Common Stock, the average of the
closing bid and asked prices of the Corporation's Common Stock as reported by
NASDAQ or on the electronic bulletin board or, if none, the National Quotation
Bureau, Inc.'s "Pink Sheets" or, if such quotations are unavailable, the value
determined by the Committee in accordance with its discretion in making a bona
fide, good faith determination of fair market value. Fair Market Value shall be
determined without regard to any restriction other than a restriction which, by
its terms, never will lapse.

     

    (h)           "Option"
means either an Incentive Stock Option or a Non-qualified Stock Option, or
either or both of them.

     

    (i)           "Option
Price" means the purchase price of the shares of Common Stock covered by an
Option determined in accordance with Section 6(c) hereunder.

     

    (j)           "Parent"
means any corporation which is a "parent corporation" as defined in Section
424(e) of the Code, with respect to the Corporation.

     

    (k)           "Plan"
means this Restated 1993 Stock Option Plan.

     

    (1)           "Recipient"
means any person granted an Option hereunder.

     

    (m)           "Securities
Act" means the Securities Act of 1933, as amended from time to
time.

     

    (n)           "Subsidiary"
means any corporation which is a "subsidiary corporation" as defined in Section
424(f) of the Code, with respect to the Corporation.

     

    2.           Administration.

     

    (a)           The
Plan shall be administered by the Committee. The Committee shall have the
authority in its discretion, subject to and not inconsistent with the express
provisions of this Plan, to administer this Plan and to exercise all the powers
and authorities either specifically conferred under this Plan or necessary or
advisable in the administration of this Plan, including the authority to grant
Options; to determine which Options shall be Incentive Stock Options and which
shall be Non-qualified Stock Options; to determine the vesting schedules and
other restrictions, if any, relating to Options; to determine the Option Price;
to determine the persons to whom, and the time or times at which, Options shall
be granted; to determine the number of shares to be covered by each Option; to
determine Fair Market Value per share; to interpret this Plan; to prescribe,
amend and rescind rules and regulations relating to this Plan; to determine the
terms and provisions of the Option agreements (which need not be identical)
entered into in connection with Options granted under this Plan; and to make all
other determinations deemed necessary or advisable for the administration of
this Plan. The Committee may delegate to one or more of its members or to one or
more agents such administrative duties as it may deem advisable, and the
Committee or any person to whom it has delegated duties as aforesaid may employ
one or more persons to render advice with respect to any responsibility the
Committee or such person may have under this Plan.

     

    
      
        
        

      

      
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    (b)           Options
granted under this Plan shall be evidenced by duly adopted resolutions of the
Committee included in the minutes of the meeting at which they are adopted or in
a unanimous written consent.

     

    (c)           With
respect to persons subject to Section 16 of the Exchange Act, transactions under
this Plan are intended to comply with all applicable conditions of Rule 16b-3 or
any successor regulation under the Exchange Act. To the extent any provision of
this Plan or action by the Committee fails to so comply, it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the Committee.
Any Option granted hereunder which would subject or subjects the Recipient to
liability under Section 16(b) of the Exchange Act is void ab initio as if it had
never been granted.

     

    (d)           No
member of the Committee or the Board shall be liable for any action taken or
determination made in good faith with respect to this Plan or any Option granted
hereunder.

     

    3.           Eligibility.

     

    (a)           Subject
to certain limitations hereinafter set forth, Options may be granted to
employees, officers and directors (whether or not they are employees) of, and
consultants to, the Corporation. In determining the persons to whom Options
shall be granted and the number of shares to be covered by each Option, the
Committee shall take into account the duties of the respective persons, their
present and potential contributions to the success of the Corporation and such
other factors as the Committee shall deem relevant to accomplish the purposes of
this Plan.

     

    (b)           A
Recipient shall be eligible to receive more than one grant of an Option during
the term of this Plan, on the terms and subject to the restrictions herein set
forth.

     

    4.           Stock Reserved.

     

    (a)           The
stock subject to Options hereunder shall be shares of Common Stock. Such shares,
in whole or in part, may be authorized but unissued shares or shares that shall
have been or that may be reacquired by the Corporation. The aggregate number of
shares of Common Stock as to which Options may be granted from time to time
under this Plan (the "Available Shares") shall not exceed 4,500,000
shares.  This number was originally set at 1,500,000 and subsequently
increased to 3,000,000 (shareholder approval on March 27, 1998), and then
increased again to 4,500,000 (shareholder approval on February 26,
1999).  Notwithstanding the foregoing, no more than 4,500,000 shares
of Common Stock shall be available for the grant of Incentive Stock Options
under the Plan. The number of Available Shares shall be subject to adjustment as
provided in Section 6(i) hereof.

     

    (b)           If
any outstanding Option under this Plan for any reason expires or is terminated
without having been exercised in full, the shares of Common Stock allocable to
the unexercised portion of such Option shall become available for subsequent
grants of Options under this Plan, unless this Plan shall have been
terminated.

     

    
      
        
        

      

      
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    5.           Stock Options

     

    (a)           Incentive Stock
Options.

     

    (1)           Options
granted pursuant to this Section 6(a) are intended to constitute Incentive Stock
Options and shall be subject to the following special terms and conditions, in
addition to the general terms and conditions specified in Section 6 hereof. Only
employees of the Corporation (as the term "employees" is defined for the
purposes of the Code) shall be entitled to receive Incentive Stock
Options.

     

    (2)           The
aggregate Fair Market Value (determined as of the date the Incentive Stock
Option is granted) of the shares of Common Stock with respect to which Incentive
Stock Options granted under this and any other plan of the Corporation, or any
Parent corporation or Subsidiary corporation, are exercisable for the first time
by an Recipient during any calendar year may not exceed the amount set forth in
Section 422(d) of the Code, as amended from time to time. On the date this Plan
was adopted, the maximum dollar amount as to which Incentive Stock options could
first become exercisable in any calendar year was $100,000.

     

    (3)           Incentive
Stock Options granted under this Plan are intended to satisfy all requirements
for incentive stock options under Section 422 of the Code and final Treasury
Regulations thereunder and, notwithstanding any other provision of this Plan,
this Plan and all Incentive Stock Options granted under it shall be so
construed, and all contrary provisions shall be so limited in scope and effect
and, to the extent they cannot be so limited they shall be void, except as
otherwise provided in Section 12 hereof.

     

    (b)           Non-qualified Stock
Options. Options granted pursuant to this Section 5(b) are intended to
constitute Non-qualified Stock Options and shall be subject only to the general
terms and conditions specified in Section 6 hereof.

     

    6.           Terms and Conditions of
Options. Each Option granted pursuant to this Plan shall be evidenced by
a written Option agreement between the Corporation and the Recipient, which
agreement shall be in substantially the form of Exhibit A hereto as modified
from time to time by the Committee in its discretion, and which shall comply
with and be subject to the following terms and conditions

     

    (a)           Number of Shares.
Each Option agreement shall state the number of shares of Common Stock covered
by the Option.

     

    (b)           Type of Option. Each
Option agreement shall specifically identify the portion, if any, of the option
which constitutes an Incentive Stock Option and the portion, if any, which
constitutes a Non-qualified Stock Option.

     

    
      
        
        

      

      
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    (c)           Option
Price.  Each Option agreement shall state the Option Price,
which shall be determined by the Committee subject only to the following
restrictions:

     

    (1)           The
Option Price of any Incentive Stock Option shall be not less than 100% of the
Fair Market Value per share on the date of grant of the Option; provided,
however, that any Incentive Stock Option granted under this Plan to a person
owning more than ten percent of the total combined voting power of the Common
Stock shall have an Option Price of not less than 110% of the Fair Market Value
per share on the date of grant of the Incentive Stock Option.

     

    (2)           Any
Non-qualified Stock Option granted under the Plan shall be at a price no less
than 80% of the Fair Market Value per share on the date of grant
thereof.

     

    (3)           The
Option Price shall be subject to adjustment as provided in Section 6(i)
hereof.

     

    (d)           Term of Option. Each
Option agreement shall state the period during and times at which the option
shall be exercisable; provided, however:

     

    (1)           The
date on which the Committee adopts a resolution expressly granting an Option
shall be considered the day on which such Option is granted, unless a future
date is specified in the resolution; provided, however, the Recipient shall have
no rights under the grant until the Recipient has executed an Option agreement
with respect to such Option.

     

    (2)           Except
as further restricted in paragraph 6(d)(3), the exercise period shall not exceed
ten years from the date of grant of the Option.

     

    (3)           Incentive
Stock Options granted to a person owning more than ten percent of the total
combined voting power of the Common Stock of the Corporation shall be for no
more than five years.

     

    (4)           The
Committee shall have the authority to accelerate or extend the exercisability of
any outstanding Option at such time and under such circumstances as it, in its
sole discretion, deems appropriate. No exercise period may be extended to
increase the term of the Option beyond ten years from the date of the
grant.

     

    (5)           The
exercise period shall be subject to earlier termination as provided in Sections
6(f) and 6(g) hereof and, furthermore, shall be terminated upon surrender of the
option by the holder thereof if such surrender has been authorized in advance by
the Committee.

     

    
      
        
        

      

      
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    (e)           Method of Exercise and
Medium and Time of Payment.

     

    (1)           An
Option may be exercised as to any or all whole shares of Common Stock as to
which it then is exercisable.

     

    (2)           Each
exercise of an Option granted hereunder, whether in whole or in part, shall be
by written notice to the secretary of the Corporation designating the number of
shares as to which the Option is being exercised, and shall be accompanied by
payment in full of the Option Price for the number of shares so designated,
together with any written statements required by any applicable securities
laws.

     

    (3)           The
Option Price shall be paid in cash, or as authorized by the Committee, in shares
of Common Stock having a Fair Market Value equal to such Option Price or in
property or in a combination of cash, shares and property and, subject to
approval of the Committee, may be effected in whole or in part (A) with monies
received from the Corporation at the time of exercise as a compensatory cash
payment, or (B) with monies borrowed from the Corporation pursuant to repayment
terms and conditions as shall be determined from time to time by the Committee,
in its discretion, separately with respect to each exercise of an Option and
each Recipient; provided, however, that each such method and time for payment
and each such borrowing and the terms and conditions of repayment shall be
permitted by and be in compliance with applicable law.

     

    (4)           The
Committee shall have the sole and absolute discretion to determine whether or
not property other than cash or Common Stock may be used to purchase the shares
of Common Stock hereunder and, if so, to determine the value of the property
received.

     

    (5)           Applicable
withholding taxes shall be paid in the manner specified by Section 7
hereof.

     

    (f)           Termination. Except
as provided herein, an Option may not be exercised unless the Recipient then is
an employee, officer or director of, or consultant to, the Corporation or a
Subsidiary of or Parent to the Corporation, and unless the Recipient has
remained continuously as an employee, officer or director of, or consultant to,
the Corporation since the date of grant of the Option.

     

    
      
        
        

      

      
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    (1)           If
the Recipient ceases to be an employee, officer or director of, or consultant
to, the Corporation or a Subsidiary or Parent to the Corporation (other than by
reason of death, Disability or retirement), other than for Cause (as defined
below), all Options theretofore granted to such Recipient but not theretofore
exercised shall terminate three months after the date the Recipient ceased to be
an employee, officer or director of, or consultant to, the
Corporation.  In the event of a termination of employment or cessation
of working relationship for Cause, all unexercised Options shall immediately
terminate and expire.  For purposes of this Plan, a termination or
cessation for “Cause” means a termination of the Recipient’s employment or other
working relationship as a result of (A) willful refusal to perform his or
her obligations to the Company, (B) willful misconduct contrary to the
interests of the Company, (C) Commission of a serious criminal act, whether
denominated a felony, misdemeanor or otherwise, or (D) engaging in
activities directly in competition or antithetical to the best interests of the
Company.  To the extent a Recipient is a party to an employment
agreement or offer letter of employment with the Company that defines “cause” or
a similar term, then the meaning set forth in that agreement shall also be
considered “Cause” for purposes of this Plan.

     

    (2)           Nothing
in this Plan or in any Option granted hereunder shall confer upon an individual
any right to continue in the employ of, or other relationship with, the
Corporation or interfere in any way with the right of the Corporation to
terminate such employment or other relationship between the individual and the
Corporation.

     

    (g)           Death, Disability or
Retirement of Recipient. If a Recipient shall die while an employee,
officer or director of, or a consultant to, the Corporation, or if the
Recipient's employment, officer or director status, or consulting relationship,
shall terminate by reason of Disability or retirement, all Options theretofore
granted to such Recipient, whether or not otherwise exercisable, unless earlier
terminated in accordance with their terms, may be exercised by the Recipient or
by the Recipient's estate or by a person who acquired the right to exercise such
options by bequest or inheritance or otherwise by reason of the death or
Disability of the Recipient, at any time within one year after the date of
death, Disability or retirement of the Recipient; provided, however, that in the
case of Incentive Stock Options such one-year period shall be limited to three
months in the case of retirement.

     

    (h)           Transferability
Restriction.

     

    (1)           Options
granted under this Plan shall not be transferable other than by will or by the
laws of descent and distribution or pursuant to a qualified domestic relations
order as defined by the Code or Title I of the Employee Retirement Income
Security Act of 1974, or the rules thereunder. Options may be exercised, during
the lifetime of the Recipient, only by the Recipient and thereafter only by his
or her legal representative.

     

    (2)           Any
attempted sale, pledge, assignment, hypothecation or other transfer of an Option
contrary to the provisions hereof and the levy of any execution, attachment or
similar process upon an Option shall be null and void and without force or
effect and shall result in a termination of the Option.

     

    
      
        
        

      

      
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    (3)           (A)
As a condition to the transfer of any shares of Common Stock issued upon
exercise of an Option granted under this Plan, the Corporation may require an
opinion of counsel, satisfactory to the Corporation, to the effect that such
transfer will not be in violation of the Securities Act or any other applicable
securities laws or that such transfer has been registered under federal and all
applicable state securities laws. (B) Further, the Corporation shall be
authorized to refrain from delivering or transferring shares of Common Stock
issued under this Plan until the Committee determines that such delivery or
transfer will not violate applicable securities laws and the Recipient has
tendered to the Corporation any federal, state or local tax owed by the
Recipient as a result of exercising the Option or disposing of any Common Stock
when the Corporation has a legal liability to satisfy such tax. (C) The
Corporation shall not be liable for damages due to delay in the delivery or
issuance of any stock certificate for any reason whatsoever, including, but not
limited to, a delay caused by listing requirements of any securities exchange or
the National Association of Securities Dealers, or any registration requirements
under the Securities Act, the Exchange Act, or under any other state or federal
law, rule or regulation. (D) The Corporation is under no obligation to take any
action or incur any expense in order to register or qualify the delivery or
transfer of shares of Common Stock under applicable securities laws or to
perfect any exemption from such registration or qualification. (E) Furthermore,
the Corporation will not be liable to any Recipient for failure to deliver or
transfer shares of Common Stock if such failure is based upon the provisions of
this paragraph.

     

    (i)           Effect of Certain
Changes.

     

    (1)           If
there is any change in the number of shares of Common Stock through the
declaration of stock dividends, or through a recapitalization resulting in stock
splits, or combinations or exchanges of such shares, the number of shares of
Common Stock available for Options and the number of such shares covered by
outstanding options, and the exercise price per share of the outstanding
options, shall be proportionately adjusted by the Committee to reflect any
increase or decrease in the number of issued shares of Common Stock; provided,
however, that any fractional shares resulting from such adjustment shall be
eliminated.  A stock dividend on the Company’s Series B Preferred
Stock, which stock is convertible into Common Stock, shall not be deemed an
event that triggers an adjustment under this paragraph 6(i)(1).

     

    
      
        
        

      

      
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    (2)           In
the event of the proposed dissolution or liquidation of the Corporation, or any
corporate separation or division, including, but not limited to, split-up,
split-off or spin-off, or a merger or consolidation of the Corporation with
another corporation, the Committee may provide that the holder of each Option
then exercisable shall have the right to exercise such Option (at its then
current Option Price) solely for the kind and amount of shares of stock and
other securities, property, cash or any combination thereof receivable upon such
dissolution, liquidation, corporate separation or division, or merger or
consolidation by a holder of the number of shares of Common Stock for which such
Option might have been exercised immediately prior to such dissolution,
liquidation, or corporate separation or division, or merger or consolidation; or
in the alternative the Committee may provide that each option granted under this
Plan shall terminate as of a date fixed by the Committee; provided, however,
that not less than 30 days' written notice of the date so fixed shall be given
to each Recipient, who shall have the right, during the period of 30 days
preceding such termination, to exercise the Option as to all or any part of the
shares of Common Stock covered thereby, including shares as to which such option
would not otherwise be exercisable.

     

    (3)           Paragraph
(2) of this Section 6(i) shall not apply to a merger or consolidation in which
the Corporation is the surviving corporation and shares of Common Stock are not
converted into or exchanged for stock, securities of any other corporation, cash
or any other thing of value. Notwithstanding the preceding sentence, in case of
any consolidation or merger of another corporation into the Corporation in which
the Corporation is the surviving corporation and in which there is a
reclassification or change (including a change which results in the right to
receive cash or other property) of the shares of Common Stock (other than a
change in par value, or from par value to no par value, or as a result of a
subdivision or combination, but including any change in such shares into two or
more classes or series of shares), the Committee may provide that the holder of
each Option then exercisable shall have the right to exercise such option solely
for the kind and amount of shares of stock and other securities (including those
of any new direct or indirect Parent of the Corporation), property, cash or any
combination thereof receivable upon such reclassification, change, consolidation
or merger by the holder of the number of shares of Common Stock for which such
option might have been exercised.

     

    (4)           Notwithstanding
paragraph (2) of this Section 6(i), in the event of any merger or consolidation
in which the Corporation is not the surviving corporation, or any sale or
transfer by the Corporation of all or substantially all its assets, or any
tender offer or exchange offer for, or the acquisition, directly or indirectly,
by any person or group for more than 50% of the then outstanding voting
securities of the Corporation (each such transaction referred to as a “Sales
Event”), all Options granted under the Plan shall become exercisable in full,
notwithstanding any other provision of this Plan or of any outstanding Options
granted thereunder, including provisions providing for staggered vesting of
options, on and after (i) the fifteenth day prior to the effective date of such
merger, consolidation, sale, transfer or acquisition or (ii) the date of
commencement of such tender offer or exchange offer, as the case may be. To the
extent that Section 422(d) of the Code would not permit the provisions of the
foregoing sentence to apply to any outstanding Incentive Stock Options, such
Incentive Stock Options shall immediately upon the occurrence of the event
described in the foregoing sentence, be treated for all purposes of this Plan as
Non-qualified Stock Options and shall be immediately exercisable as such as
provided in the foregoing sentence. Notwithstanding the foregoing, in no event
shall any Option be exercisable after the date of termination of the exercise
period of such Option specified in Section 6(d).

     

    
      
        
        

      

      
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    (5)           If
there is a change in the Common Stock of the Corporation as presently
constituted, which is limited to a change of all of its authorized shares with
par value into the same number of shares with a different par value or without
par value, the shares resulting from any such change shall be deemed to be the
Common Stock within the meaning of this Plan.

     

    (6)           To
the extent that the foregoing adjustments relate to stock or securities of the
Corporation, such adjustments shall be made by the Committee, whose
determination in that respect shall be final, binding and conclusive, provided
that each Incentive Stock Option granted pursuant to this Plan shall not be
adjusted in a manner that causes such option to fail to continue to qualify as
an Incentive Stock Option within the meaning of Section 422 of the Code, except
as otherwise provided in Section 6(i)(4) hereof.

     

    (7)           Except
as expressly provided in this Section 6(i), the Recipient shall have no rights
by reason of any subdivision or consolidation of shares of stock of any class or
the payment of any stock dividend or any other increase or decrease in the
number of shares of stock of any class or by reason of any dissolution,
liquidation, merger, or consolidation or split-up, split-off or spin-off of
assets or stock of another corporation; and any issue by the Corporation of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock subject to the
Option. The grant of an Option under this Plan shall not affect in any way the
right or power of the Corporation to make adjustments, reclassifications,
reorganizations or changes of its capital or business structures or to merge or
to consolidate or to dissolve, liquidate or sell, or transfer all or part of its
business or assets.

     

    (j)           Rights as
Shareholder/Non-Distributive Intent.

     

    (1)           Neither
a person to whom an Option is granted, nor such person's legal representative,
heir, legatee or distributee, shall be deemed to be the holder of, or to have
any rights of a holder with respect to, any shares of Common Stock subject to
such Option until after the Option is exercised and the shares are issued to the
person exercising such Option.

     

    (2)           Upon
exercise of an Option at a time when there is no registration statement in
effect under the Securities Act relating to the shares issuable upon exercise,
shares may be issued to the Recipient only if the Recipient represents and
warrants in writing to the Corporation that the shares purchased are being
acquired for investment and not with a view to the distribution thereof and
provides the Corporation with sufficient information to establish an exemption
from the registration requirements of the Securities Act.

     

    
      
        
        

      

      
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    (3)           No
shares shall be issued upon the exercise of an Option unless and until there
shall have been compliance with any then applicable requirements of the
Securities and Exchange Commission, or any other regulatory agencies having
jurisdiction over the Corporation.

     

    (4)           No
adjustment shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property) or distribution or other rights for which
the record date is prior to the date such stock certificate is issued, except as
provided in Section 6(i) hereof.

     

    (k)           Other
Provisions.  Option agreements evidencing Options granted under the
Plan shall contain such other provisions, including, without limitation, (i) the
imposition of restrictions upon the exercise of an Option, and (ii) in the case
of an Incentive Stock Option, the inclusion of any condition not consistent with
such Option qualifying as an Incentive Stock Option, as the Committee shall deem
advisable.

     

    7.           Agreement by Recipient Regarding
Withholding Taxes.   Each Recipient agrees that the
Corporation, to the extent permitted or required by law, shall deduct a
sufficient number of shares due to the Recipient upon exercise of the Option to
allow the Corporation to pay federal, state and local taxes of any kind required
by law to be withheld upon the exercise of such option from any payment of any
kind otherwise due to the Recipient. The Corporation shall not be obligated to
advise any Recipient of the existence of any tax or the amount which the
Corporation will be so required to withhold.

     

    8.           Term of Plan. Options may be
granted under this Plan from time to time within a period of ten years from the
date this Plan was last amended by the Board and the shareholders of the
Company, pursuant to IRS regulations.  Effective December 4, 1998 the
Board amended the Plan to cover up to 4,500,000 shares, which increase was
approved by the Corporation’s shareholders on February 26, 1999, and so
Options may be granted under this Plan until December 3, 2008.

     

    9.           Amendment and Termination of the
Plan. The Committee at any time and from time to time may suspend,
terminate, modify or amend this Plan.  Except as provided in
Section 6 hereof, no suspension, termination, modification or amendment of
the Plan may adversely affect any option previously granted, unless the written
consent of the Recipient is obtained.

     

    
      
        
        

      

      
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    10.           Assumption. Subject to Section
6, the terms and conditions of any outstanding Options granted under this Plan
shall be assumed by, be binding upon and shall inure to the benefit of any
successor corporation to the Corporation and continue to be governed by, to the
extent applicable, the terms and conditions of this Plan. Such successor
corporation may but shall not be obligated to assume this Plan.

     

    11.           Termination of Right of
Action.  Every right of action arising out of or in connection
with this Plan by or on behalf of the Corporation, or by any shareholder of the
Corporation against any past, present or future member of the Board, or against
any employee, or by an employee (past, present or future) against the
Corporation, irrespective of the place where an action may be brought and of the
place of residence of any such shareholder, director or employee, will cease and
be barred by the expiration of three years from the date of the act or omission
in respect of which such right of action is alleged to have risen or such
shorter period as may be provided by law.

     

    12.           Tax Litigation.  The
Corporation shall have the right, but not the obligation, to contest, at its
expense, any tax ruling or decision, administrative or judicial, on any issue
which is related to this Plan and which the Committee believes to be important
to holders of Options granted under this Plan and to conduct any such contest or
any litigation arising therefrom to a final decision.

     

    13.           Adoption.  This Plan
was originally approved by the Board of Directors of the Corporation on
September 20, 1993 and approved by the Corporation’s shareholders on
March 15, 1994.  This Plan was subsequently amended to increase
the number of shares available for grant, with the Board most recently
increasing the available shares to 4,500,000 on December 4, 1998 (and
shareholder approval of the increase on February 26, 1999).  This
Plan has been restated effective May 15, 2003 to incorporate various clarifying
changes, which changes neither increase the number of shares available nor
expand the category of individuals that may be Recipients.

     

     

     

     

     

     

     

     

     

     

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