IS TO INCREASE
AUTOMATICALLY EACH CALENDAR YEAR PURSUANT TO THE PROVISIONS OF SECTION V.B OF
THIS ARTICLE ONE.
SUCH ADJUSTMENTS TO THE OUTSTANDING OPTIONS 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.
F.
OUTSTANDING AWARDS GRANTED PURSUANT TO THE PLAN SHALL IN NO WAY AFFECT
THE RIGHT OF THE CORPORATION TO ADJUST, RECLASSIFY, REORGANIZE OR OTHERWISE
CHANGE ITS CAPITAL OR BUSINESS STRUCTURE OR TO MERGE, CONSOLIDATE, DISSOLVE,
LIQUIDATE OR SELL OR TRANSFER ALL OR ANY PART OF ITS BUSINESS OR ASSETS.
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ARTICLE TWO
DISCRETIONARY OPTION 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.
All options granted under the Plan shall be
Non-Statutory Options.
A.
EXERCISE PRICE.
1.
THE EXERCISE PRICE PER SHARE SHALL BE FIXED BY THE PLAN ADMINISTRATOR.
2.
THE EXERCISE PRICE SHALL BECOME IMMEDIATELY DUE UPON EXERCISE OF THE
OPTION AND SHALL, SUBJECT TO THE PROVISIONS OF THIS PLAN AND THE DOCUMENTS
EVIDENCING THE OPTION, BE PAYABLE IN ONE OR MORE OF THE FORMS SPECIFIED BELOW:
(A)
CASH OR CHECK MADE PAYABLE TO THE CORPORATION,
(B)
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, OR
(C)
IF 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 (I) 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 (II) THE CORPORATION
TO DELIVER THE CERTIFICATES FOR THE PURCHASED SHARES DIRECTLY TO SUCH BROKERAGE
FIRM IN ORDER TO COMPLETE THE SALE.
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.
EACH OPTION SHALL 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.
HOWEVER, NO OPTION SHALL HAVE A TERM IN EXCESS OF TEN (10) YEARS
MEASURED FROM THE OPTION GRANT DATE.
C.
EFFECT OF TERMINATION OF SERVICE.
1.
THE FOLLOWING PROVISIONS SHALL GOVERN THE EXERCISE OF ANY OPTIONS GRANTED
PURSUANT TO THE DISCRETIONARY OPTION GRANT PROGRAM THAT ARE OUTSTANDING AT THE
TIME OF THE OPTIONEE'S CESSATION OF SERVICE:
5
(A)