AWARD, AND (VI) THE MAXIMUM NUMBER, TYPE AND/OR CLASS OF SECURITIES BY
WHICH THE SHARE RESERVE IS TO INCREASE AUTOMATICALLY EACH CALENDAR YEAR PURSUANT
TO THE PROVISIONS OF SECTION V.B. OF THIS ARTICLE ONE. SUCH ADJUSTMENTS TO THE
OUTSTANDING AWARDS ARE TO BE EFFECTED IN A MANNER WHICH SHALL PRECLUDE THE
ENLARGEMENT OR DILUTION OF RIGHTS AND BENEFITS UNDER SUCH OPTIONS. THE
ADJUSTMENTS DETERMINED BY THE PLAN ADMINISTRATOR SHALL BE FINAL, BINDING AND
CONCLUSIVE.
4
ARTICLE TWO
DISCRETIONARY OPTION/STOCK APPRECIATION RIGHT GRANT PROGRAM
I.
OPTION TERMS
Each option shall be evidenced by one or more documents in the form approved by
the Plan Administrator; provided, however, that each such document shall comply
with the terms specified below. Each document evidencing an Incentive Option
shall, in addition, be subject to the provisions of the Plan applicable to such
options.
A.
EXERCISE PRICE.
1.
THE EXERCISE PRICE PER SHARE SHALL BE
FIXED BY THE PLAN ADMINISTRATOR BUT SHALL NOT BE LESS THAN ONE HUNDRED PERCENT
(100%) OF THE FAIR MARKET VALUE PER SHARE OF COMMON STOCK ON THE OPTION GRANT
DATE.
2.
THE EXERCISE PRICE SHALL BECOME
IMMEDIATELY DUE UPON EXERCISE OF THE OPTION AND SHALL, SUBJECT TO THE PROVISIONS
OF THE DOCUMENTS EVIDENCING THE OPTION, BE PAYABLE IN ONE OR MORE OF THE FORMS
SPECIFIED BELOW:
(I)
CASH OR CHECK MADE PAYABLE TO THE
CORPORATION, OR
(II)
SHARES OF COMMON STOCK HELD FOR THE
REQUISITE PERIOD NECESSARY TO AVOID A CHARGE TO THE CORPORATION'S EARNINGS FOR
FINANCIAL REPORTING PURPOSES AND VALUED AT FAIR MARKET VALUE ON THE EXERCISE
DATE (INCLUDING THE CANCELLATION OF SHARES OF COMMON STOCK SUBJECT TO THE
OPTION), OR
(III)
TO THE EXTENT THE OPTION IS EXERCISED FOR
VESTED SHARES, THROUGH A SPECIAL SALE AND REMITTANCE PROCEDURE PURSUANT TO WHICH
THE OPTIONEE SHALL CONCURRENTLY PROVIDE IRREVOCABLE INSTRUCTIONS TO (A) A
CORPORATION-DESIGNATED BROKERAGE FIRM TO EFFECT THE IMMEDIATE SALE OF THE
PURCHASED SHARES AND REMIT TO THE CORPORATION, OUT OF THE SALE PROCEEDS
AVAILABLE ON THE SETTLEMENT DATE, SUFFICIENT FUNDS TO COVER THE AGGREGATE
EXERCISE PRICE PAYABLE FOR THE PURCHASED SHARES PLUS ALL APPLICABLE FEDERAL,
STATE AND LOCAL INCOME AND EMPLOYMENT TAXES REQUIRED TO BE WITHHELD BY THE
CORPORATION BY REASON OF SUCH EXERCISE AND (B) THE CORPORATION TO DELIVER THE
CERTIFICATES FOR THE PURCHASED SHARES DIRECTLY TO SUCH BROKERAGE FIRM IN ORDER
TO COMPLETE THE SALE, OR
5
(IV)
ANY OTHER FORM OF LEGAL CONSIDERATION, AS
DETERMINED BY THE PLAN ADMINISTRATOR AND SPECIFICALLY INCLUDED IN THE STOCK
OPTION AGREEMENT.
Except to the extent such sale and remittance procedure is utilized, payment of
the exercise price for the purchased shares must be made on the Exercise Date.
B.
EXERCISE AND TERM OF OPTIONS.
1.
EACH OPTION SHALL VEST AND BE
EXERCISABLE AT SUCH TIME OR TIMES, DURING SUCH PERIOD AND FOR SUCH NUMBER OF
SHARES AS SHALL BE DETERMINED BY THE PLAN ADMINISTRATOR AND SET FORTH IN THE
DOCUMENTS EVIDENCING THE OPTION.
2.
NOTWITHSTANDING ANY OTHER PROVISION OF
THE PLAN, NO OPTION SHALL HAVE A TERM IN