exv10w13



 



EXHIBIT 10.13



NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN



1.     Purpose. The purpose of the Halifax Non-Employee Directors Stock Option
Plan (the “Plan”) is to secure for Halifax Corporation (the “Company”) and its
stockholders the benefits of the incentive inherent in increased common stock
ownership by the members of the Board of Directors (the “Board”) of the Company
who are not employees of the Company or any of its subsidiaries.


2.     Adoption and Term. The Plan has been approved by the Board effective upon
approval by the Company’s shareholders on September 19, 1997. The Plan shall
terminate without further action at the close of the Company’s business day at
its principal executive office on September 18, 2004.


3.     Administration. The Plan shall be administered by the Board. The Board
shall have all the powers vested in it by the terms of the Plan, such powers to
include authority (within the limitations described herein) to prescribe the
form of the agreement embodying awards of stock options made under the Plan
(the “Options”) and the power to determine the restrictions, if any, on the
ability of participants to dispose of any stock issued in connection with the
exercise of any options granted pursuant to the Plan. The Board shall, subject
to the provisions of the Plan, have the power to construe the Plan, to
determine all questions arising thereunder and to adopt and amend such rules
and regulations for the administration of the Plan as it may deem desirable.
Any decisions of the Board in the administration of the Plan, as described
herein, shall be final and conclusive. The Board may authorize any one or more
of their number or the Secretary or any other officer of the Company to execute
and deliver documents on behalf of the Board. The Board hereby authorizes the
Secretary to execute and deliver all documents to be delivered by the Board
pursuant to the Plan. No member of the Board shall be liable for anything done
or omitted to be done by such member or by any other member of the Board in
connection with the Plan, except for such member’s own willful misconduct or as
expressly provided by statute.


4.     Amount of Stock. The stock which may be issued and sold under the Plan
will be the Common Stock (par value $0.24 per share) of the Company. The total
number of shares of stock for which Options may be granted under the Plan shall
not exceed 100,000 shares of Common Stock shares, subject to adjustment as
provided in Paragraph 6 below. The stock to be issued may be either authorized
and unissued shares or issued shares acquired by the Company or its
subsidiaries.


5.     Eligibility. Each member of the Board of the Company who is not an
employee of the Company or any of its subsidiaries (a “Non-Employee Director”)
shall be eligible to receive an Option in accordance with Paragraph 6 below.
The adoption of this Plan shall be not deemed to give any director any right to
be granted an Option, except to the extent and upon such terms and conditions,
in accordance with the terms of the Plan, as may be determined by the Board.


6.     Terms and Conditions of Options. Each Option granted under the Plan shall
be evidenced by an agreement in such form as the Board shall prescribe from
time to time in accordance with the Plan, and shall comply with the following
terms and conditions:

 






 





	 	(a)	 	The Option exercise price shall be the fair market value of the
Common Stock shares subject to such Option on the date the Option is
granted, which shall be the average of the high and the low sales
prices of a Common Stock share on the date of grant as reported on the
American Stock Exchange Composite Transactions Tape or, if the American
Stock Exchange is closed on that date, on the last preceding date on
which the American Stock Exchange was open for trading.
	 
	 	(b)	 	Each year, as of the first day of the month following the Annual
Meeting of Stockholders of the Company, each Non-Employee Director who
has been elected or reelected as a member of the Board as of the
adjournment of the Annual Meeting shall receive an Option for shares of
Common Stock as follows.




	 	 	 	(i) at any time a director is elected by the Stockholders and said
director has not previously been granted an option, a First Option shall
be granted for 5000 Common Stock shares.
	 
	 	 	 	(ii) upon each annual reelection as a director by the Stockholders, a
Subsequent Option shall be granted of up to a maximum of 2000 Common
Stock shares.
	 
	 	 	 	(iii) the total maximum number of shares of Common Stock for which any
director shall be granted Options under this Plan is 13,000.




	 	(c)	 	Options shall not be transferable by the Optionee otherwise than
by will or the laws of descent and distribution, and shall be
exercisable during the lifetime of the Optionee only by the Optionee.
	 
	 	(d)	 	No Option or any part of an Option shall be exercisable:




	 	 	 	(i) after the expiration of ten years from the date the Option was
granted,
	 
	 	 	 	(ii) unless written notice of the exercise is delivered to the Company
specifying the number of shares to be purchased and payment in full is
made for the shares of Common Stock being acquired thereunder at the time
of exercise; such payment shall be made (a) in United States dollars by
check, or bank draft, or (b) by tendering to the Company Common Stock
shares owned by the person exercising the Option and having a fair market
value equal to the cash exercise price applicable to such Option, such
fair market value to be the average of the high and low sales prices of a
Common Stock share on the date of exercise as reported on the American
Stock Exchange Composite Transactions Tape, or, if the American Stock
Exchange is closed on that date, on the last preceding date on which the
American Stock Exchange was open for trading, it being understood that
the Board shall determine acceptable methods for tendering Common Stock
shares and may impose such conditions on the use of Common Stock shares
to exercise Options as it deems appropriate, or (c) by a combination of United States dollars
and Common Stock shares as aforesaid; and



 






 





	 	 	 	(iii) in the event the right to exercise the Option granted did not vest
pursuant to paragraph 6(e) or 6(d) of the Plan prior to the date the
Optionee ceased to be a Director of the Company.




	 	(e)	 	If the Option granted is a First Option, it shall become
exercisable in installments cumulatively with respect to one sixtieth
of the Optioned Stock per month after the date of grant, so that one
hundred percent (100%) of the Optioned Stock shall be exercisable five
(5) years after the date of grant.
	 
	 	(f)	 	If the Option granted is a Subsequent Option, it shall become
exercisable in installments cumulatively with respect to one-twelfth of
the Optioned Stock per month after the date of grant, so that one
hundred percent (100%) of the Optioned Stock shall be exercisable one
(1) year after the date of grant.



7.     Effect of Changes in Capitalization.



	 	(a)	 	Changes in Shares.




	 	 	 	If the number of outstanding shares of Stock is increased or decreased or
changed into or exchanged for a different number or kind of stock or
other securities of the Company by reason of any recapitalization,
reclassification, Stock split, reverse split, combination of Stock,
exchange of Stock, Stock dividend or other distribution payable in
capital stock, or other increase or decrease in such shares effected
without receipt of consideration by the Company occurring after the date
the Option is granted, a proportionate and appropriate adjustment shall
be made by the Company in the number and kind of shares subject to the
Option, so that the proportionate interest of the Optionee immediately
following such event shall, to the extent practicable, be the same as
immediately prior to such event. Any such adjustment in the Option shall
not change the total Option Price with respect to shares subject to the
unexercised portion of the Option but shall include a corresponding
proportionate adjustment in the Option Price per share.




	 	(b)	 	Reorganization in Which the Company Is the Surviving Entity.




	 	 	 	Subject to Section (c) of this Section, if the Company shall be the
surviving entity in any reorganization, merger or consolidation of the
Company with one or more other entities, the Option shall pertain to and
apply to the securities to which a holder of the number of shares subject
to the Option would have been entitled immediately following such
reorganization, merger or consolidation, with a corresponding
proportionate adjustment of the Option Price per share so that the
aggregate Option Price thereafter shall be the same as the aggregate
Option Price of the shares remaining subject to the Option immediately
prior to such reorganization, merger or consolidation.




	 	(c)	 	Reorganization in Which the Company Is Not the Surviving Company or
Sale of Assets or Stock.




	 	 	 	Upon the dissolution liquidation of the Company, or upon a merger,
consolidation or reorganization of the Company with one or more other
companies in which the Company



 






 







	 	 	 	is not the surviving company, or upon a
sale of substantially all of the assets of the Company to another
company, or upon any transaction (including, without limitation, a merger
or reorganization in which the Company is the surviving company) approved
by the Board which results in any person or entity owning 50 percent or
more of the combined voting power of all classes of stock of the Company,
the Option shall terminate, except to the extent provision is made in
writing in connection with such transaction for the assumption of the
Option, or for the substitution for the Option of a new option covering
the stock of a successor company, or a parent or subsidiary thereof, with
appropriate adjustments as to the number and kinds of shares and exercise
prices, in which event the Option shall continue in the manner and under
the terms so provided. In the event of any such termination of the
Option, the Optionee shall have the right immediately prior to the
occurrence of such termination and during such period occurring prior to
such termination as the Board in its sole discretion shall determine and
designate, to exercise the Option to the extent that the Option was
otherwise exercisable at the time such termination occurs. The
Administrator shall send written notice of an event that will result in
such a termination to the Optionee not later than the time at which the
Company gives notice thereof to its stockholders.



8.     Miscellaneous Provisions.



	 	(a)	 	Except as expressly provided for in the Plan, no Non-Employee
Director or other person shall have any claim or right to be granted
an option under the Plan. Neither the Plan nor any action taken
hereunder shall be construed as giving any Non-Employee Director any
right to be retained in the service of the Company.
	 
	 	(b)	 	An Optionee’s rights and interest under the Plan may not be
assigned or transferred in whole or in part either directly or by
operation of law or otherwise (except in the event of an Optionee’s
death, by will or the laws of descent and distribution), including,
but not by way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy, or in any other manner, and no such
right or interest of any participant in the Plan shall be subject to
any obligation or liability of such participant.
	 
	 	(c)	 	No Common Stock shares shall be issued hereunder unless counsel for
the Company shall be satisfied that such issuance will be in compliance
with applicable Federal, state, and other securities laws and
regulations.
	 
	 	(d)	 	It shall be a condition to the obligation of the Company to issue
Common Stock shares upon exercise of an Option, that the Optionee (or
any beneficiary or person entitled to act under subparagraph 5(d)(iii)
above) pay to the Company, upon its demand, such amount as may be
requested by the Company for the purpose of satisfying any liability to
withhold Federal, state, local, or foreign income or other taxes. If
the amount requested is not paid (which payment may be made in any
manner prescribed in subparagraph 5(d)(ii), the Company may refuse to
issue Common Stock shares.
	 
	 	(e)	 	The expenses of the Plan shall be borne by the Company.



 






 





	 	(f)	 	The Plan shall be unfunded. the Company shall not be required to
establish any special or separate fund or to make any other
segregation of assets to assure the issuance of shares upon exercise
of any Option under the Plan, and the issuance of shares upon exercise
of Options shall be subordinate to the claims of the Company’s general
creditors.
	 
	 	(g)	 	By accepting any Option or other benefit under the Plan, each
Optionee and each person claiming under or through such person shall be
conclusively deemed to have indicated his or her acceptance and
ratification of, and consent to, any action taken under the Plan by the
Company or the Board.



9.     Amendment or Discontinuance. The Plan may be amended at any time and from
time to time by the Board as the Board shall deem advisable; provided, however,
that no amendment shall become effective without stockholder approval if such
stockholder approval is required by law, rule, or regulation, and provided
further, to the extent required by Rule 16B-3 under Section 16 of the
Securities Exchange Act of 1934, in effect from time to time, Plan provisions
relating to the amount, price, and timing of Options shall not be amended more
than once every six months, except that the foregoing shall not preclude any
amendment to comport with changes in the Internal Revenue Code of 1986, the
Employee Retirement Income Security Act of 1974, or the rules thereunder in
effect from time to time. No amendment of the Plan shall materially and
adversely affect any right of any participant with respect to any Option
theretofore granted without such participant’s written consent.


10.     Effective Date of Plan. The Plan shall become effective when the Plan is
approved and adopted by the Company’s stockholders.