EXHIBIT 21
NEW YORK STATE ELECTRIC & GAS CORPORATION
NON-STATUTORY STOCK OPTION AWARD AGREEMENT
1. Pursuant to the provisions of the 1997 Stock Option Plan, as it may be
amended from time to time (hereinafter called the "Plan"), of New York State
Electric & Gas Corporation (hereinafter called the "Company"), the Company
hereby grants to ________________ (hereinafter called the "Optionee"), subject
in all respects to the terms and conditions of the Plan and subject further to
the terms and conditions herein set forth, the right and option to purchase from
the Company all or any part of an aggregate of _______ shares of Common Stock
($6.66 2/3 Par Value) of the Company at the purchase price of $_____ per share
(hereinafter called the "Option"). Capitalized terms not defined herein shall
have the same definitions as in the Plan.
2. The Option is a Non-Statutory Stock Option and is intended not to qualify
as an Incentive Stock Option under Section 422 of the Code.
3. The Option may be exercised, except as otherwise provided herein, in whole
or in part at any time after its grant date, May 21, 1997 ("Option Grant Date")
and prior to May 21, 2007 ("Option Expiration Date"). Partial exercises of the
Option shall be made only with respect to whole shares of the Company's Common
Stock.
4. In addition to the grant of the Option hereunder, the Optionee is hereby
granted Stock Appreciation Rights in tandem with the Option which entitle the
Optionee to receive from the Company, upon the exercise of such Stock
Appreciation Rights, an amount equal to the excess of the Fair Market Value of a
share of the Company's Common Stock, determined on the date of the exercise,
over the exercise price of the Option. Stock Appreciation Rights shall not be
exercisable earlier than November 21, 1997 and shall expire on the Option
Expiration Date. Upon their exercise, Stock Appreciation Rights shall be settled
in cash. The exercise of Stock Appreciation Rights granted shall result in the
corresponding cancellation of the Option to the extent of the number of shares
of the Company's Common Stock as to which Stock Appreciation Rights are
exercised. The exercise of the Option shall result in the corresponding
cancellation of the Stock Appreciation Rights to the extent of the number of
shares of the Company's Common Stock as to which the Option is exercised. The
Option and the Stock Appreciation Rights are collectively referred to
hereinafter as "Awards".
5. Neither the Option nor any right hereunder shall be assignable or
transferrable by the Optionee or be subject to any lien, obligation or liability
of the Optionee, except that the Option may be transferred:
(a) by the Optionee by will or the laws of descent and distribution;
(b) by the Optionee, with the prior written consent of the committee
administering the Plan ("Committee"), by gift to (i) the Optionee's
spouse or a child or grandchild of the Optionee or of the Optionee's
spouse, or (ii) a trust or an estate in which the Optionee or the
Optionee's spouse or a child or grandchild of the Optionee or of the
Optionee's spouse has a substantial interest; and
(c) by the Optionee, with the prior written consent of the Committee,
pursuant to a domestic relations order as defined in Section 414 of
the Code, or any successor provision.
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In the event of a transfer, the Option shall continue to be subject to all the
terms and conditions contained herein and the Optionee shall remain obligated to
pay to the Company, upon the exercise of the Option by the Optionee's
transferee, amounts sufficient to satisfy any applicable federal, state and
local withholding tax requirements. The Option may not be further transferred by
the Optionee's transferee, except by will or the laws of
descent and distribution. Moreover, the Committee may require a transferee who
acquires the Option pursuant to Subsections (b) or (c) above to furnish to the
Company, as a condition to the issuance of shares upon the exercise of the
Option, an agreement (in such form as the Committee may specify) that is
executed by the transferee and that contains such provisions, including
representations and restrictions as to the transferability of the shares, as are
required by the Committee.
In the event of the termination of the employment of the Optionee, the Option
shall be exercisable by the Optionee's transferee only to the extent specified,
and during the applicable periods set forth, in Section 11 hereof.
A transfer of all or any portion of the Option shall result in the concurrent
transfer of the related tandem Stock Appreciation Rights. Stock Appreciation
Rights may not be transferred by themselves.
6. Unless otherwise provided by the Committee, the Option, or any portion
thereof, shall be exercised by a written notice (in such form as the Committee
may specify) that is addressed to the Secretary of the Company and that
specifies the number of shares with respect to which it is being exercised and
the total exercise price. The written notice shall be accompanied by the payment
of the exercise price in cash or the equivalent payable to the Company, or,
unless otherwise provided by the Committee, by tendering (either actually or by
delivery of a Committee-approved form attesting to stock ownership) previously
acquired shares of the Company's Common Stock which are owned by the Optionee
(or the
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Optionee's transferee) and which are not subject to any pledge or other
security interest, or by any combination of the foregoing. With respect to
shares tendered in lieu of the payment of cash or cash equivalents, such shares
shall be valued on the basis of their Fair Market Value on the date of exercise.
Unless otherwise provided by the Committee, an Option shall not be deemed
exercised until the date ("Exercise Date") that both a written notice of
exercise and the payment of the exercise price in the form required herein is
provided to the Company in accordance with the provisions of Section 10 hereof.
The Committee, in its sole discretion, may, in lieu of delivering shares
covered by the exercised Option, settle the exercise of the Option by means of a
cash payment to the Optionee (or the Optionee's transferee) equal to the
difference between the Fair Market Value of the Company's Common Stock
determined on the Exercise Date and the Option Price. The Committee shall at the
same time return to the Optionee (or the Optionee's transferee) any payment for
the shares covered by the Option.
Unless otherwise provided by the Committee, (i) the Stock Appreciation Rights
shall be exercised by delivery of a written notice that is addressed to the
Secretary of the Company and that specifies the number of shares with respect to
which the Stock Appreciation Right is being exercised, and (ii) the Exercise
Date with respect to a Stock Appreciation Right shall be the date the written
notice of exercise of the Stock Appreciation Right is provided to the Company
in accordance with the provisions of Section 10 hereof.
7. As a condition to the issuance of shares of Common Stock of the Company
under the Option, the Optionee shall remit (or cause to be remitted) to the
Company an amount sufficient to satisfy any applicable federal, state and local
withholding tax requirements. An Optionee may, totally or in part, satisfy this
obligation by electing to have shares withheld (with the consent of the
Optionee's
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transferee, in the event the Option is exercised by a transferee) or
by delivering other shares having a Fair Market Value equal to the amount
required to be withheld, provided that this election is made in writing on or
prior to the date of the exercise of the Option. The Fair Market Value of any
shares so withheld or delivered shall be determined as of the date the taxes are
required to be withheld.
8. Except as otherwise provided herein, to the extent that all or any portion
of the exercise price, or taxes incurred in connection with the exercise of the
Option, are paid by the Optionee by surrendering shares of the Company's Common
Stock (or, in the case of the payment of taxes, by the withholding of shares)
then, concurrently with such surrender or withholding, the Optionee shall be
granted as an additional option a replacement option, subject in all respects to
the provisions of the Plan, including but not limited to Article V
thereof. The replacement option, to the extent permissible, shall cover the
number of shares of the Company's Common Stock surrendered to pay the exercise
price plus the number of shares surrendered or withheld to satisfy the
Optionee's tax liability and shall have an exercise price equal to 100% of the
Fair Market Value of the Company's Common Stock determined on the date such
replacement option is granted. The replacement option shall not be exercisable
for six months from the date of its grant and shall expire on the Option
Expiration Date. No replacement option shall be issued after November 21, 2006.
Replacement options shall be issued with respect to options which are themselves
replacement options. Notwithstanding the foregoing, neither the surrender of
shares in connection with the exercise of the Option (or a replacement option)
by the Optionee's transferee, nor the surrender or withholding of shares in
connection with the payment of any taxes incurred with respect to such an
exercise, shall result in the grant of a replacement option to any party.
9. The Company shall, on or as soon as practicable after the date of the
exercise of all or a portion of the Option, deliver to the Optionee (or the
Optionee's
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transferee) a certificate or certificates for the appropriate number
of shares of the Company's Common Stock (or in the event that the Company is
using a book entry system, make the appropriate book entry). Notwithstanding
anything to the contrary contained in the Plan or this Agreement, the Company
shall not be required to issue shares of Common Stock until all applicable
legal, listing, registration and regulatory requirements or approvals relating
to the issuance have been satisfied or obtained. The shares of the Company's
Common Stock issued upon the exercise of an Option may not be transferred except
in accordance with all applicable federal and state securities laws, rules and
regulations. Certificates issued to transferees of the Optionee may contain
legends reflecting any restrictions on transferability imposed by the Company in
order to comply with such laws, rules and regulations. The Company shall not be
required to register any shares issued to any transferees of the Optionee.
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10. All notices under this Agreement shall be in writing. Notices, other
communications and payments provided for in this Agreement shall be deemed to
have been duly given or made when delivered in person or when mailed by United
States registered mail, return receipt requested, postage prepaid, addressed to
the Company at the address set forth below or to the Optionee at the address set
forth on the signature page of this Agreement or to such substitute address as
either party may have furnished to the other in writing in accordance herewith,
except that notice of change of address shall be effective only upon actual
receipt:
Corporate Secretary
New York State Electric & Gas Corporation
Corporate Drive
Kirkwood Industrial Park
X.X. Xxx 0000
Xxxxxxxxxx, Xxx Xxxx 00000-0000
11. Termination of Employment.
(a) In the event that the Optionee ceases to be an employee of the
Company by reason of death or total disability, the Awards may be
exercised by the Optionee or by the Optionee's legal representative
or representatives or by the persons entitled to do so under the
Optionee's will or the laws of descent and distribution, to the
extent the Awards are then otherwise exercisable, during the one-year
period following the date of the Optionee's death or total
disability, but not after the expiration of such period.
(b) In the event that the Optionee ceases to be an employee of the
Company by reason of termination by the Company of the Optionee's
employment for cause (as determined in the sole discretion of the
Committee), the
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Awards shall expire to the extent that they are unexercised at the
time of such termination of employment.
(c) In the event that the Optionee ceases to be an employee of the
Company for any reason other than death, total disability or
termination of employment by the Company for cause, the Optionee may
exercise the Awards, to the extent the Awards are then otherwise
exercisable, during the ninety-day period following the date of such
cessation of employment, but not after the expiration of such
period.
12. In the event of any change in the number of outstanding shares of the
Company's Common Stock or the Common Stock price by reason of any stock dividend
or split, recapitalization, merger, consolidation, spin-off, reorganization,
combination, exchange of shares or other similar corporate change, then in any
such event the number and kind of shares subject to the Awards and the exercise
price per share may be appropriately adjusted consistent with such change in
such manner as the Committee in its sole discretion may deem equitable. Any
adjustments made by the Committee shall be conclusive and binding for all
purposes of the Plan.
In the event of the dissolution or complete liquidation of the Company, or
upon a reorganization, merger or consolidation of the Company which results in
the outstanding shares of the Company's Common Stock subject to this Option
being changed into or exchanged for property (including cash), rights or
securities not issued by the Company, or any combination thereof, or the sale of
all or substantially all of the Company's assets to, or the acquisition of
shares of the Company representing more than seventy-five percent (75%) of the
voting power
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of the stock of the Company then outstanding by, another corporation or
person, the Awards shall terminate, unless provision is made in writing in
connection with such transaction for the assumption of the Awards, or the
substitution for the Awards of an award covering the shares of a successor
employer corporation, or a parent or a subsidiary thereof, with appropriate
adjustments in accordance with the provisions hereinabove as to the number
and kind of shares awarded and their exercise price, in which event the
Awards shall continue in the manner and under the terms so provided.
13. The Awards shall not confer upon the Optionee any right with respect to
the continuance of employment with the Company, nor shall it affect any right
which the Company may have to terminate the employment of the Optionee.
14. The Optionee (or Optionee's transferee) shall not be entitled to the
rights of a stockholder with respect to any shares of the Company's Common Stock
subject to the Option prior to the date of issuance of a certificate or
certificates for such shares (or in the event that the Company is using a book
entry system, the date the Company makes the appropriate book entry). No
adjustment shall be made for dividends or distributions or other rights with
respect to such shares for which the record date is prior to the date the stock
certificate or certificates are issued (or appropriate book entry is made).
15. A copy of the Plan has been delivered to the Optionee prior to the
execution hereof and is on file at the Company's corporate offices in Binghamton
and Ithaca, New York.
16. This Agreement shall be governed by the laws of the State of New York,
other than its conflicts of laws provisions. In the event of an inconsistency
between any term of the Plan and any term of this Agreement, the terms of the
Plan shall govern.
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NEW YORK STATE ELECTRIC & GAS CORPORATION
By:
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Vice President and Secretary
Dated: May 21, 1997
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ACCEPTED AND AGREED TO:
Optionee acknowledges receipt of a copy of the Plan and represents that Optionee
is familiar with the terms and provisions contained therein. Optionee hereby
accepts the Awards subject to all of the terms and provisions of the Plan.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
and interpretations of the Committee as to any questions arising under the Plan,
the Option and the Stock Appreciation Rights.
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