Exhibit 4.6


 


GENERAL
GROWTH PROPERTIES, INC.


1993
STOCK INCENTIVE PLAN, AS AMENDED(1)


 






(1) As
of May 15, 1997


 


SECTION 1.
PURPOSE; DEFINITIONS.


 


The
purpose of the Plan is to give the Company a significant advantage in
attracting, retaining and motivating officers, employees and directors and to
provide the Company and its Subsidiaries with the ability to provide incentives
more directly linked to the profitability of the Company’s businesses and
increases in stockholder value.


 


For
purposes of the Plan, the following terms are defined as set forth below:


 


“Affiliate”
means a corporation or other entity controlled by the Company and designated by
the Committee as such.


 


“Award”
means a Stock Option or Restricted Stock.


 


“Board”
means the Board of Directors of the Company.


 


“Cause”
has the meaning set forth in Section 5(i).


 


“Change
in Control” and “Change in Control Price” have the meanings set forth in Section 7(b) and
(c) respectively.


 


“Code”
means the Internal Revenue Code of 1986, as amended from time to time, and any
successor thereto.


 


“Commission”
means the Securities and Exchange Commission or any successor agency.


 


“Committee”
means the Committee referred to in Section 2.


 


“Common
Stock” means common stock, par value $.10 per share, of the Company.


 


“Company”
means General Growth Properties, Inc., a Delaware corporation.


 

















 


“Disability”
means permanent and total disability as determined under procedures established
by the Committee for purposes of the Plan.


 


“Disinterested
Person” shall mean a member of the Board who qualifies as a disinterested
person as defined in Rule 16b-3(c)(2), as promulgated by the Commission
under the Exchange Act, or any successor definition adopted by the Commission.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to time,
and any successor thereto.


 


“Fair
Market Value” means, as of any given date, the mean between the highest and
lowest reported sales prices of the Common Stock on the New York Stock Exchange
Composite Tape or, if not listed on such exchange, on any other national
securities exchange on which the Common Stock is listed or on NASDAQ. If there
is no regular public trading market for such Common Stock, the Fair Market
Value of the Common Stock shall be determined by the Committee in good faith.


 


“Incentive
Stock Option” means any Stock Option intended to be and designated as an “incentive
stock option” within the meaning of Section 422 of the Code.


 


“Non-Qualified
Stock Option” means any Stock Option that is not an Incentive Stock Option.


 


“Plan”
means the General Growth Properties, Inc. 1993 Stock Incentive Plan, as
set forth herein and as hereinafter amended from time to time.


 


“Restricted
Stock” means an award granted under Section 6.


 


“Retirement”
means retirement from active employment under a pension plan of the Company,
any Subsidiary or Affiliate, or under an employment contract with any of them,
or termination of employment at or after age 65 under circumstances which the
Committee, in its sole discretion, deems equivalent to retirement.


 


“Rule 16b-3”
means Rule 16b-3, as promulgated by the Commission under Section 16(b) of
the Exchange Act, as amended from time to time.


 


“Stock
Option” or “Option” means an option granted under Section 5.


 


“Subsidiary”
means any corporation, partnership or other entity


 

















 


of
which the Company or any Subsidiary owns, directly or indirectly, a majority of
the voting power of the voting equity securities or a majority of the equity interest.


 


“Termination
of Employment” means the termination of the participant’s employment with the
Company or any Subsidiary or Affiliate. A participant employed by a Subsidiary
or an Affiliate shall also be deemed to incur a Termination of Employment if
the Subsidiary or Affiliate ceases to be such a Subsidiary or Affiliate, as the
case may be, and the participant does not immediately thereafter become an
employee of the Company or another Subsidiary or Affiliate.


 


In
addition, certain other terms used herein have definitions given to them in the
first place in which they are used.


 


SECTION 2.
ADMINISTRATION.


 


The
Plan shall be administered by the Compensation Committee of the Board or such
other committee of the Board composed of not less than two Disinterested
Persons, each of whom shall be appointed by and serve at the pleasure of the
Board (the “Committee”). If at any time no Committee shall be in office, the
functions of the Committee specified in the Plan shall be exercised by the
Board.


 


The
Committee shall have plenary authority to grant Awards pursuant to the terms of
the Plan to officers, employees and directors of the Company and its Subsidiaries
and Affiliates.


 


Among
other things, the Committee shall have the authority, subject to the terms of
the Plan:


 


(a) to
select the officers, employees and directors to whom Awards may from time to
time be granted; provided that awards to non-employee directors shall be made
only in accordance with Section 12;


 


(b) to
determine whether and to what extent Incentive Stock Options, Non-Qualified
Stock Options and Restricted Stock or any combination thereof are to be granted
hereunder; 


 


(c) to
determine the number of shares of Common Stock to be covered by each Award
granted hereunder;


 


(d) to
determine the terms and conditions of any Award granted hereunder (including, but
not limited to, subject to Section 5(a), the option price, any vesting
restriction or limitation and any vesting


 

















 


acceleration
or forfeiture waiver regarding any Award and the shares of Common Stock
relating thereto, based on such factors as the Committee shall determine);


 


(e) to
modify, amend or adjust the terms and conditions of any Award, at any time or
from time to time, including, but not limited to, with respect to performance
goals and measurements applicable to performance-based Awards pursuant to the
terms of the Plan;


 


(f) to
determine to what extent and under what circumstances Common Stock and other
amounts payable with respect to an Award shall be deferred; and 


 


(g) to
determine under what circumstances a Stock Option may be settled in case or
Common Stock under Section 5(j).


 


The
Committee shall have the authority to adopt, alter and repeal such administrative
rules, guidelines and practices governing the Plan as it shall, from time to
time, deem advisable, to interpret the terms and provisions of the Plan and any
Award issued under the Plan (and any agreement relating thereto) and to
otherwise supervise the administration of the Plan.


 


The
Committee may act with respect to the Plan only by a majority of its members
then in office, except that the members thereof may (i) delegate to an officer
of the Company the authority to make decisions pursuant to paragraphs (c), (f),
(g), (h) and (i) of Section 5 (provided that no such delegation
may be made that would cause Awards or other transactions under the Plan to
cease to be exempt from Section 16(b) of the Exchange Act) and (ii) authorize
any one or more of their number or any officer of the Company to execute and
deliver documents on behalf of the Committee.


 


Any
determination made by the Committee or pursuant to delegated authority pursuant
to the provisions of the Plan with respect to any Award shall be made in the
sole discretion of the Committee or such delegate at the time of the grant of
the Award or, unless in contravention of any express term of the Plan, at any
time thereafter. All decisions made by the Committee or any appropriately
delegated officer pursuant to the provisions of the Plan shall be final and
binding on all persons, including the Company and Plan participants.


 


SECTION 3.
COMMON STOCK SUBJECT TO PLAN.


 


Subject
to adjustment as provided herein, the total number of shares of Common Stock
available for distribution pursuant to Awards under the Plan shall be 3,000,000
shares of Common Stock. Shares subject to an Award under the Plan may be
authorized and unissued shares or may be treasury shares.


 

















 


In
the event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, extraordinary distribution with respect to the Common
Stock or other change in corporate structure affecting the Common Stock, the
Committee or Board may make such substitution or adjustments in the aggregate
number and kind of shares reserved for issuance under the Plan, in the number,
kind and option price of shares subject to outstanding Stock Options, in the
number and kind of shares subject to other outstanding Awards granted under the
Plan and/or such other substitution or adjustments in the consideration
receivable upon exercise as it may determine to be appropriate in its sole
discretion; provided, however, that the number of shares subject to any Award
shall always be a whole number.


 


SECTION 4.
ELIGIBILITY.


 


Officers,
employees and directors of the Company, its Subsidiaries and Affiliates who are
responsible for or contribute to the management, growth and profitability of
the business of the Company, its Subsidiaries and Affiliates are eligible to be
granted Awards under the Plan. Except as expressly authorized by Section 12
of the Plan, however, no grant shall be made to a director who is not an
officer or a salaried employee.


 


SECTION 5.
STOCK OPTIONS.


 


Stock
Options may be granted alone or in addition to other Awards granted under the
Plan and may be of two types: Incentive Stock Options and Non-Qualified Stock
Options. Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.


 


The
Committee shall have the authority to grant any optionee Incentive Stock
Options, Non-Qualified Stock Options or both types of Stock Options. Incentive
Stock Options may be granted only to employees of the Company and its Subsidiaries
(within the meaning of Section 424(f) of the Code). To the extent that
any Stock Option is not designated as an Incentive Stock Option or even if so
designated does not qualify as an Incentive Stock Option, it shall constitute a
Non-Qualified Stock Option.


 


Stock
Options shall be evidenced by option agreements, the terms and provisions of
which may differ. An option agreement shall indicate on its face whether it is
intended to be an agreement for an Incentive Stock Option or a Non-Qualified
Stock Option. The grant of a Stock Option shall occur on the date the Committee
by resolution selects an individual to be a participant in any grant of a Stock
Option, determines the number of shares of Stock to be subject to such Stock
Option to be granted to such individual and specifies the terms and provisions
of the Stock Option. The Company shall notify a


 

















 


participant
of any grant of a Stock Option, and a written option agreement or agreements
shall be duly executed and delivered by the Company to the participant. Such
agreement or agreements shall become effective upon execution by the
participant.


 


Anything
in the Plan to the contrary notwithstanding, no term of the Plan relating to
Incentive Stock Options shall be interpreted, amended or altered nor shall any
discretion or authority granted under the Plan be exercised so as to disqualify
the Plan under Section 422 of the Code or, without the consent of the
optionee affected, to disqualify any Incentive Stock Option under such Section 422.


 


Stock
Options granted under the Plan shall be subject to the following terms and
conditions and shall contain such additional terms and conditions as the
Committee shall deem desirable:


 


(a) Option
Price. The option price per share of Common Stock purchasable under a Stock
Option shall be determined by the Committee and set forth in the option
agreement, and shall not be less than the Fair Market Value of the Common Stock
subject to the Stock Option on the date of grant.


 


(b) Option
Term. The term of each Stock Option shall be fixed by the Committee, but no
Stock Option shall be exercisable more than 10 years after the date the Stock
Option is granted.


 


(c) Exercisability.
Except as otherwise provided herein, Stock Options shall be exercisable at such
time or times and subject to such terms and conditions as shall be determined
by the Committee. If the Committee provides that any Stock Option is
exercisable only in installments, the Committee may at any time waive such
installment exercise provisions, in whole or in part, based on such factors as
the Committee may determine. No Stock Option shall be exercisable until such time
as 25% or more of the outstanding Common Stock has been issued pursuant to a
public offering. In addition, the Committee may at any time, in whole or in
part, accelerate the exercisability of any Stock Option.


 


(d) Method
of Exercise. Subject to the provisions of this Section 5, Stock Options may be
exercised, in whole or in part, at any time during the option term by giving
written notice of exercise to the Company specifying the number of shares of
Common Stock subject to the Stock Option to be purchased.


 


The
option price of Common Stock to be purchased upon exercise of


 
















 


any
Option shall be paid in full in cash (by certified or bank check or such other
instrument as the Company may accept) or, if and to the extent set forth in the
option agreement, may also be paid by one or more of the following: (i) in the form of unrestricted Common Stock already owned
by the optionee (and, in the case of the exercise of
a Non-Qualified Stock Option, Restricted Stock subject to an Award hereunder)
based in any such instance on the Fair Market Value of the Common Stock on the
date the Stock Option is exercised; provided, however, that, in the case of an Incentive
Stock Option, the right to make a payment in the form of already owned shares
of Common Stock may be authorized only at the time the Stock Option is granted;
(ii)by requesting the Company to withhold from the number of shares of Common
Stock otherwise issuable upon exercise of the Stock Otion that number of shares having an aggregate fair market
value on the date of exercise equal to the exercise price for all of the shares
of Common Stock subject to such exercise; or (iii) by a combination thereof, in
each case in the manner provided in the option agreement.


 


In
the discretion of the Committee, payment for any shares subject to a Stock
Option may also be made by delivering a properly executed exercise notice to
the Company, together with a copy of irrevocable instructions to a broker to
deliver promptly to the Company the amount of sale or loan proceeds to pay the
purchase price. To facilitate the foregoing, the Company may enter into
agreements for coordinated procedures with one or more brokerage firms.


 


If
payment of the option exercise price of a Non-Qualified Stock Option is made in
whole or in part in the form of Restricted Stock, the number of shares of
Common Stock to be received upon such exercise equal to the number of shares of
Restricted Stock used for payment of the option exercise price shall be subject
to the same forfeiture restrictions to which such Restricted Stock was subject,
unless otherwise determined by the Committee.


 


No
shares of Common Stock shall be issued until full payment therefor
has been made. Subject to any forfeiture restrictions that may apply if a Stock
Option is exercised using Restricted Stock, an optionee
shall have all of the rights of a stockholder of the Company holding the Common
Stock that is subject to such Stock Option (including, if applicable, the right
to vote the shares and the right to receive dividends), when the optionee has given written notice of exercise, has paid in
full for such shares and, if requested, has given the representation described
in Section 10(a).


 


(e)
Non-transferability of Stock Options. No Stock Option shall be transferable by
the optionee other than (i)
by will or by the laws of


 

















 


descent and
distribution or (ii) pursuant to a qualified domestic relations order (as
defined in the Code or Title I of the Employee Retirement Income Security Act
of 1974, as amended, or the rules thereunder). All
Stock Options shall be exercisable, during the optionee’s
lifetime, only by the optionee or by the guardian or
legal representative of the optionee or by an
alternate payee pursuant to such qualified domestic relations order, it being
understood that the terms “holder” and “optionee”
include the guardian and legal representative of the optionee named in the option agreement and any person to
whom an option is transferred by will or the laws of descent and distribution
or pursuant to a qualified domestic relations order.


 


(f)
Termination by Death. If an optionee’s employment terminates
by reason of death, any Stock Option held by such optionee
may thereafter be exercised, to the extent then exercisable, or on such
accelerated basis as the Committee may determine~ for a period of one year (or
such other period as the Committee may specify in the option agreement) from
the date of such death or until the expiration of the stated term of such Stock
Option, whichever period is the shorter. In the event of termination of
employment due to death, if an Incentive Stock Option is exercised after the
expiration of the exercise periods that apply for purposes of Section 422 of
the Code, such Stock Option will thereafter be treated as a Non-Qualified Stock
Option.


 


(g)
Termination by Reason of Disability. If an optionee’s
employment terminates by reason of Disability, any Stock Option held by such optionee may thereafter be exercised by the optionee, to the extent it was exercisable at the time of
termination, or on such accelerated basis as the Committee may determine, for a
period of three years (or such shorter period as the Committee may specify in
the option agreement) from the date of such termination of employment or until
the expiration of the stated term of such Stock Option, whichever period is the
shorter; provided, however, that if the optionee dies
within such three-year period (or such shorter period), any unexercised Stock
Option held by such optionee shall, notwithstanding
the expiration of such three-year (or such shorter) period, continue to be
exercisable to the extent to which it was exercisable at the time of death for
a period of one year from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter. In the event
of termination of employment by reason of Disability, if an Incentive Stock Option
is exercised after the expiration of the exercise periods that apply for
purposes of Section 422 of the Code, such Stock Option will thereafter be
treated as a Non-Qualified Stock Option.


 


(h)
Termination by Reason of Retirement. If an  optionee’s


 

















 


employment
terminates by reason of Retirement, any Non-Qualified Stock Option held by such
optionee may thereafter be exercised by the optionee, to the extent it was exercisable at the time of
such Retirement or on such accelerated basis as the Committee may determine,
for a period of three years (or such shorter period as the Committee may
specify in the option agreement) from the date of such termination of
employment or until the expiration of the stated term of such Non-Qualified
Stock Option, whichever period is the shorter; provided, however, that if the optionee dies within such three-year (or such shorter)
period, any unexercised Non-Qualified Stock Option held by such optionee shall, notwithstanding the expiration of such
three-year (or such shorter) period, continue to be exercisable to the extent
to which it was exercisable at the time of death for a period of one year from
the date of such death or until the expiration of the stated term of such Non-Qualified
Stock Option, whichever period is the shorter. In the event of termination of
employment by reason of Retirement, an Incentive Stock Option may be exercised
by the optionee, to the extent it was exercisable at
the time of such Retirement or on such accelerated basis as the Committee may
determine, only within a period of three months thereafter or prior to the
expiration of the stated term of such Incentive Stock Option, whichever period
is the shorter; provided, however, that if the optionee
dies within such three-month period, any unexercised Incentive Stock Option
held by such optionee shall, notwithstanding the
expiration of such three-month period, continue to be exercisable to the extent
to which it was exercisable at the time of death for a period of one year from
the date of such death or until the expiration of the stated term of such
Incentive Stock Option, whichever period is the shorter.


 


(i) Other Termination. Unless otherwise determined by the Committee,
if there occurs a Termination of Employment for any reason other than death,
Disability, Retirement or Cause, any Stock Option held by such Optionee shall thereupon terminate, except that such Stock Option,
to the extent then exercisable, or on such accelerated basis as the Committee
may determine, may, if such Termination of Employment is without Cause, be
exercised for the lesser of (A) in the case of a Non-Qualified Stock Option,
one year from the date of such Termination of Employment or the balance of such
Stock Option’s term and (B) in the case of an Incentive Stock Option, three
months from the date of such Termination of Employment or the balance of such
Stock Option’s term; provided, however, that if the optionee
dies within such one year or three-month period, any unexercised Stock Option
held by such optionee shall notwithstanding the
expiration of such one-year or three-month period, continue to be exercisable
to the extent to which it was exercisable at the time of death for a period of
one year from the date


 

















 


of such death or
until the expiration of the stated term of such Stock Option, whichever period
is the shorter. In the event of Termination of Employment for Cause, any
unexercised Stock Option held by such optionee shall
expire immediately upon the giving to the optionee of
notice of such Termination of Employment. Unless otherwise determined by the Committee,
for the purposes of the Plan, “Cause” shall mean (i)
the conviction of the optionee for committing a
felony under Federal law or the law of the state in which such action occurred,
(ii) dishonesty in the course of fulfilling the optionee’s
employment duties or (iii)Ewillful
and deliberate failure on the part of the optionee to
perform his employment duties in any material respect.


 


(j)
Cashing Out of Stock Option. On receipt of written notice of exercise, the
Committee may elect to cash out all or any part of the shares of Common Stock
for which a Stock Option is being exercised by paying the optionee
an amount, in cash or Common Stock, equal to the excess of the Fair Market
Value of the Common Stock over the option price times the number of shares of
Common Stock for which the Stock Option is being exercised on the effective
date of such cash out.


 


Cash
outs pursuant to this Section 5(j) relating to options held by optionees who are actually or potentially subject to
Section 16(b) of the Exchange Act shall comply with the “window period”
provisions of Rule 16b-3(e), to the extent applicable. 


 


(k) Change in Control Cash Out. Notwithstanding any other
provision of the Plan, during the 60-day period from and after a Change in
Control (the “Exercise Period”), unless the Committee shall determine otherwise
at the time of grant, an optionee shall have the
right, whether or not the Stock Option is fully exercisable and in lieu of the
payment of the exercise price for the shares of Common Stock being purchased
under the Stock Option and by giving notice to the Company, to elect (within
the Exercise Period) to surrender all or part of the Stock Option to the Company
and to receive cash, within 30 days of such notice, in an amount equal to the
amount by which the Change in Control Price per share of Common Stock on the
date of such election shall exceed the exercise price per share of Common Stock
under the Stock Option (the “Spread”) multiplied by the number of shares of
Common Stock granted under the Stock Option as to which the right granted under
this Section 5(k) shall have been exercised; provided, however, that if the
Change in Control is within six months of the date of grant of a particular
Stock Option held by an optionee who is an officer or
director of the Company and is subject to Section 16(b) of the Exchange Act no
such election shall be made by such optionee with
respect to such Stock Option prior to six months from the date of grant.
Notwithstanding any other provision


 

















 


hereof,
if the end of such 60-day period from and after a Change in Control is within
six months of the date of grant of a Stock Option held by an optionee who is an officer or director of the Company and
is subject to Section 16(b) of the Exchange Act, such Stock Option shall be cancelled
in exchange for a cash payment to the optionee,
effected on the day which is six months and one day after the date of grant of
such Option, equal to the Spread multiplied by the number of shares of Common
Stock granted under the Stock Option.


 


SECTION
6.  RESTRICTED STOCK.


 


(a)
Administration. Shares of Restricted Stock may be awarded either alone or in
addition to other Awards granted under the Plan. The Committee shall determine the
officers and employees to whom and the time or times at which grants of
Restricted Stock will be awarded, the number of shares to be awarded to any
participant, the time or times within which such Awards may be subject to
forfeiture and any other terms and conditions of the Awards, in addition to
those contained in Section 6(c).


 


The
Committee may condition the grant of Restricted Stock upon the attainment of
specified performance goals of the participant or of the Company or Subsidiary,
division or department of the Company for or within which the participant is
primarily employed or upon such other factors or criteria as the Committee
shall determine. The provisions of Restricted Stock Awards need not be the same
with respect to each recipient.


 


(b)
Awards and Certificates. Shares of Restricted Stock shall be evidenced in such
manner as the Committee may deem appropriate, including book-entry registration
or issuance of one or more stock certificates. Any certificate issued in
respect of shares of Restricted Stock shall be registered in the name of such
participant and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Award, substantially in the
following form:


 


The
transferability of this certificate and the shares of stock represented hereby
are subject to the terms and conditions (including forfeiture) of the General
Growth Properties, Inc. 1993 Stock Incentive Plan and a Restricted Stock
Agreement. Copies of such Plan and Agreement are on file at the office of the
Secretary of General Growth Properties, Inc.


 


The
Committee may require that the certificates evidencing such shares be held in
custody by the Company until the restrictions thereon shall have lapsed and that,
as a condition of any Award of Restricted Stock, the participant shall


 
















 


have
delivered a stock power, endorsed in blank, relating to the Common Stock covered
by such Award.


 


(c) Terms
and Conditions. Shares of Restricted Stock shall be subject to the following
terms and conditions:


 


(i) Subject
to the provisions of the Plan and the Restricted Stock Agreement referred to in
Section 6(c)(vi), during a period set by the Committee, commencing with
the date of such Award (the “Restriction Period”), the participant shall not be
permitted to sell, assign, transfer, pledge or otherwise encumber shares of
Restricted Stock. The Committee may provide for the lapse of such restrictions
in installments or otherwise and may accelerate or waive such restrictions, in
whole or in part, in each case based on period of service, performance of the
participant or of the Company or the Subsidiary, division or department for
which the participant is employed or such other factors or criteria as the
Committee may determine.


 


(ii) Except
as provided in this paragraph (ii) and Section 6(c)(i) and the Restricted
Stock Agreement, the participant shall have, with respect to the shares of
Restricted Stock, all of the rights of a stockholder of the Company holding the
class or series of Common Stock that is the subject of the Restricted Stock, including,
if applicable, the right to vote the shares and the right to receive any cash
dividends. If so determined by the Committee in the applicable Restricted Stock
Agreement and subject to Section 10(f) of the Plan, (A) cash
dividends on the shares of Common Stock that are the subject of the Restricted
Stock Award shall be automatically deferred and reinvested in additional Restricted
Stock and (B) dividends payable in Common Stock shall be paid in the form
of Restricted Stock.


 


(iii) Except
to the extent otherwise provided in the applicable Restricted Stock Agreement
and Sections 6(c)(i), 6(c)(iv) and 7(a)(ii), upon a participant’s
Termination of Employment for any reason during the Restriction Period, all
shares still subject to restriction shall be forfeited by the participant.


 


(iv) Except
to the extent otherwise provided in Section 7(a)(ii), in the event of a
Termination of Employment of a participant for any reason (other than for
Cause), the Committee shall have the discretion to waive in whole or in part
any or all remaining restrictions with respect to any or all of such participant’s
shares of Restricted Stock.


 

















 


(v) If
and when the Restriction Period expires without a prior forfeiture of the
Restricted Stock subject to such Restriction Period, unlegended certificates
for such shares shall be delivered to the participant.


 


(vi) Each
Award shall be confirmed by, and be subject to the terms of, a Restricted Stock
Agreement.


 


SECTION 7.
CHANGE IN CONTROL PROVISIONS.


 


(a) Impact
of Event. Notwithstanding any other provision of the Plan to the contrary, in
the event of a Change in Control:


 


(i) Any
Stock Options outstanding as of the date such Change in Control is determined
to have occurred and not then exercisable and vested shall become fully
exercisable and vested to the full extent of the original grant.


 


(ii) The
restrictions applicable to any Restricted Stock shall lapse, and such
Restricted Stock shall become free of all restrictions and become fully vested
and transferable to the full extent of the original grant.


 


(b) Definition
of Change in Control. For purposes of the Plan, a “Change in Control” shall
mean the happening of any of the following events:


 


(i) An
acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or
more of either (1) the then outstanding shares of common stock of the Company
(the “Outstanding Common Stock”) or (2) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Voting Securities”); excluding,
however, the following: (1) any acquisition directly from the Company,
other than an acquisition by virtue of the exercise of a conversion privilege
unless the security being so converted was itself acquired directly from the Company,
(2) any acquisition by the Company, or members of the Company’s
management, or any combination thereof, (3) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company or (4) any acquisition by any
Person


 

















 


pursuant
to a transaction which complies with clauses (1), (2) and (3) of
subsection (iii) of this Section 7(b); or


 


(ii) A change in the composition of the Board such that the individuals
who, as of the effective date of the Plan, constitute the Board (such Board
shall be hereinafter referred to as the “Incumbent Board”) cease for any reason
to constitute at least a majority of the Board; provided, however, for purposes
of this Section 7(b), that any individual who becomes a member of the
Board subsequent to such effective dater whose election, or nomination for
election by the Company’s shareholders, was approved by a vote of at least a
majority of those individuals who are members of the Board and who were also
members of the Incumbent Board (or deemed to be such pursuant to this proviso)
shall be considered as though such individual were a member of the Incumbent Board;
but, provided further, that any such individual whose initial assumption of
office occurs as result of either an actual or threatened election contest (as
such terms are used in Rule 14a-11 of Regulation 14A promulgated under the
Exchange Act) or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board shall not be so considered as
a member of the Incumbent Board; or


 


(iii) The approval by the shareholders of the Company of a reorganization,
merger or consolidation or sale or other disposition of all or substantially
all of the assets of the Company (“Corporate Transaction”); excluding, however,
such a Corporate Transaction pursuant to which (1) all or substantially all
of the individuals and entities who are the beneficial owners, respectively, of
the Outstanding Common Stock and Outstanding Voting Securities immediately
prior to such Corporate Transaction will beneficially own, directly or
indirectly, more than 60% of, respectively, the outstanding shares of common
stock, and the combined voting power of the then outstanding voting securities entitled
to vote generally in the election of directors, as the case may be, of the
corporation resulting from such Corporate Transaction (including, without
limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company’s assets either directly or through
one or more Subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Corporate Transaction, of the Outstanding
Common Stock and Outstanding Voting Securities, as the case may be, (2) no
Person (other than the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the 


 

















 


Company or such corporation resulting from such Corporate Transaction)
will beneficially own, directly or indirectly, 20% or more of, respectively,
the outstanding shares of common stock of the corporation resulting from such
Corporate Transaction or the combined voting power of the outstanding voting
securities of such corporation entitled to vote generally in the election of
directors except to the extent that such ownership existed with respect to the
Company prior to the Corporate Transaction and (3) individuals who were
members of the Incumbent Board will constitute at least a majority of the
members of the board of directors of the corporation resulting from such Corporate
Transaction; or


 


(iv) The approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company. 


 


(c) Change in Control Price. For purposes of the Plan, “Change in Control
Price” means the higher of (i) the highest reported sales price, regular
way, of a share of Common Stock in any transaction reported on the New York
Stock Exchange Composite Tape or other national securities exchange on which
such shares are listed or on NASDAQ, as applicable, during the 60-day period
prior to and including the date of a Change in Control and (ii) if the
Change in Control is the result of a tender or exchange offer or a Corporate
Transaction, the highest price per share of Common Stock paid in such tender or
exchange offer or Corporate Transaction; provided, however, that (x) in
the case of a Stock Option which (A) is held by an optionee who is an
officer or director of the Company and is subject to Section 16(b) of
the Exchange Act and (B) was granted within 240 days of the Change in
Control, then the Change in Control Price for such Stock Option shall be the
Fair Market Value of the Common Stock on the date such Stock Option is
exercised or cancelled and (y) in the case of Incentive Stock Options, the
Change in Control Price shall be in all cases the Fair Market Value of the
Common Stock on the date such Incentive Stock Option is exercised. To the
extent that the consideration paid in any such transaction described above
consists all or in part of securities or other non-cash consideration, the
value of such securities or other non-cash consideration shall be determined in
the sole discretion of the Board.


 


SECTION 8. TERM, AMENDMENT AND TERMINATION.


 


The Plan will terminate on April 4, 2003. Under the Plan, Awards outstanding
as of April 4, 2003 shall not be affected or impaired by the termination
of the Plan.


 


The Board may amend, alter, or discontinue the Plan, but no amendment,


 

















 


alteration or discontinuation shall be made which would (i) impair
the rights of an optionee under a Stock Option or a recipient of a Restricted
Stock Award theretofore granted without the optionee’s or recipient’s consent,
except such an amendment made to cause the Plan to qualify for the exemption
provided by Rule 16b-3, or (ii) disqualify the Plan from the
exemption provided by Rule 16b-3. In addition, no such amendment shall be made
without the approval of the Company’s stockholders to the extent such approval
is required by law or agreement. 


 


The Committee may amend the terms of any Stock Option or other Award theretofore
granted, prospectively or retroactively, but no such amendment shall impair the
rights of any holder without the holder’s consent except such an amendment made
to cause the Plan or Award to qualify for the exemption provided by Rule 16b-3.


 


Subject to the above provisions, the Board shall have authority to
amend the Plan to take into account changes in law and tax and accounting
rules, as well as other developments and to grant Awards which qualify for
beneficial treatment under such rules without stockholder approval.


 


SECTION 9. UNFUNDED STATUS OF PLAN.


 


It is presently intended that the Plan constitute an “unfunded” plan
for incentive and deferred compensation. The Committee may authorize the
creation of trusts or other arrangements to meet the obligations created under
the Plan to deliver Common Stock or make payments; provided, however, that,
unless the Committee otherwise determines, the existence of such trusts or
other arrangements is consistent with the “unfunded” status of the Plan.


 


SECTION 10. GENERAL PROVISIONS.


 


(a) The Committee may require each person purchasing or receiving shares
pursuant to an Award to represent to and agree with the Company in writing that
such person is acquiring the shares without a view to the distribution thereof.
The certificates for such shares may include any legend which the Committee
deems appropriate to reflect any restrictions on transfer.


 


All certificates for shares of Common Stock or other securities delivered
under the Plan shall be subject to such stock transfer orders and other
restrictions as the Committee may deem advisable under the rules, regulations
and other requirements of the Commission, any stock exchange upon which the
Common Stock is then listed and any applicable Federal or state securities law,
and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference  



 
















 


to
such restrictions.


 


(b) Nothing
contained in the Plan shall prevent the Company or any Subsidiary or Affiliate
from adopting other or additional compensation arrangements for its employees.


 


(c) The
adoption of the Plan shall not confer upon any employee any right to continued
employment nor shall it interfere in any way with the right of the Company or
any Subsidiary or Affiliate to terminate the employment of any employee at any
time.


 


(d) No
later than the date as of which an amount first becomes includible in the gross
income of the participant for Federal income tax purposes with respect to any
Award under the Plan, the participant shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of, any Federal,
state, local or foreign taxes of any kind required by law to be withheld with
respect to such amount. Unless otherwise determined by the Committee,
withholding obligations may be settled with Common Stock, including Common
Stock that is part of the Award that gives rise to the withholding requirement.
The obligations of the Company under the Plan shall be conditional on such
payment or arrangements, and the Company, its Subsidiaries and its Affiliates
shall, to the extent permitted by law, have the right to deduct any such taxes from
any payment otherwise due to the participant. The Committee may establish such
procedures as it deems appropriate, including the making of irrevocable
elections, for the settlement of withholding obligations with Common Stock.


 


(e) At
the time of grant, the Committee may provide in connection with any grant made
under the Plan that the shares of Common Stock received as a result of such
grant shall be subject to a right of first refusal pursuant to which the
participant shall be required to offer to the Company any shares that the
participant wishes to sell at the then Fair Market Value of the Common Stock,
subject to such other terms and conditions as the Committee may specify at the
time of grant.


 


(f) The
reinvestment of dividends in additional Restricted Stock at the time of any
dividend payment shall only be permissible if sufficient shares of Common Stock
are available under Section 3 for such reinvestment (taking into account
then outstanding Stock Options and other Awards).


 


(g) The
Committee shall establish such procedures as it deems appropriate for a
participant to designate a beneficiary to whom any amounts payable in the event
of the participant’s death are to be paid.


 

















 


(h) The
Plan and all Awards made and actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of Delaware.


 


SECTION 11.
EFFECTIVE DATE OF PLAN.


 


The
Plan shall be effective on the later of (a) the date it is approved by the
shareholders of the Company and (b) the date, if any, specified by the Board
at the time it is approved by the Board.


 


SECTION 12.
DIRECTOR STOCK OPTIONS.


 


(a) Each
director of the Company who is not otherwise an employee of the Company or any
Subsidiary or Affiliate from and after the effective date of the Plan shall, on
the first day of each January during such director’s term, automatically
be granted Non-Qualified Stock Options to purchase 500 shares of Common Stock
having an exercise price per share equal to 100% of the Fair Market Value of the
Common Stock at the date of grant of such Non-Qualified Stock Option. Each such
director, upon joining the Board, shall also be awarded an initial grant of Non-Qualified
Stock Options to purchase 500 shares of Common Stock having an exercise price
equal to 100% of the Fair Market Value of the Common Stock as of such date.


 


(b) An
automatic director Stock Option shall be granted hereunder only if as of each
date of grant (or, in the case of any initial grant, from and after the
effective date of the Plan) the director (i) is not otherwise an employee
of the Company or any Subsidiary or Affiliate, (ii) has not been an employee of
the Company or any Subsidiary or Affiliate for any part of the preceding fiscal
year and (iii) has served on the Board continuously since the commencement
of his term.


 


(c) Each
holder of a Stock Option granted pursuant to this Section 12 shall also have
the rights specified in Section 5(k).


 


(d) In
the event that the number of shares of Common Stock available for future grant
under the Plan is insufficient to make all automatic grants required to be made
on such date, then all non-employee directors entitled to a grant on such date
shall share ratably in the number of options on shares available for grant
under the Plan.


 


(e) The
provisions of paragraph (a) of this Section 12 may not be amended
more often than once every six months. Except as expressly provided in this Section 12,
any Stock Option granted hereunder shall be


 

















 


subject
to the terms and conditions of the Plan as if the grant were made pursuant to Section 5
hereof.