Exhibit 10.1
UNIVERSAL CORPORATION
AMENDED AND RESTATED
1994 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
Article I
DEFINITIONS
1.01 Affiliate means any "subsidiary" or "parent corporation" (within
the meaning of Section 424 of the Code) of the Company.
1.02 Agreement means a written agreement (including any amendment or
supplement thereto) between the Company and a Participant specifying the terms
and conditions of a Grant issued to such Participant.
1.03 Board means the Board of Directors of the Company.
1.04 Code means the Internal Revenue Code of 1986, and any amendments
thereto.
1.05 Commission means the Securities and Exchange Commission or any
successor agency.
1.06 Committee means the Executive Compensation Committee of the Board.
1.07 Common Stock means the Common Stock of the Company.
1.08 Company means Universal Corporation.
1.09 Exchange Act means the Securities Exchange Act of 1934, as amended
from time to time, and any successor thereto.
1.10 Fair Market Value means, on any given date, the closing price of a
share of Common Stock as reported on the New York Stock Exchange composite tape
on such day or, if the Common Stock was not traded on the New York Stock
Exchange on such day, then on the next preceding day that the Common Stock was
traded on such exchange, all as reported by such source as the Committee may
select. If there is no regular public trading market for the Common Stock, the
Fair Market Value shall be determined by the Committee in good faith.
1.11 Grant means the grant of an Option.
1.12 Non-Employee Director means a member of the Board who is not an
employee of the Company or an Affiliate and was not such an employee within
three years prior to his or her first election to the Board.
1.13 Option means a stock option that entitles the holder to purchase
from the Company under the terms of this Plan the number of shares of Common
Stock set forth in Article IV at the Option Price.
1.14 Option Price means the price per share for Common Stock purchased
on the exercise of an Option as provided in Article IV.
1.15 Participant means a Non-Employee Director who is eligible to
receive a Grant under this Plan.
1.16 Rule 16b-3 means Rule 16b-3, as promulgated by the Commission in
Release No. 34-28869 under Section 16(b) of the Exchange Act, effective May 1,
1991, or any successor rule as amended from time to time.
1.17 Securities Broker means the registered securities broker
acceptable to the Company who agrees to effect the cashless exercise of an
Option pursuant to Section 7.03 hereof.
1.18 Subsidiary means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of the
corporations in the chain (other than the last corporation) owns stock
possessing at least 50 percent of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
Article II
PURPOSE
This Plan is intended to associate the interests of the Non-Employee
Directors with those of the Company and its shareholders through increased
equity ownership, to assist the Company in recruiting and retaining individuals
of ability and experience who are not employed by the Company to serve on the
Board and its committees and to provide incentive to those individuals by
enabling them to participate in the future success of the Company.
Article III
ADMINISTRATION
The Plan shall be administered by the Committee. The Committee shall
have all the powers vested in it by the terms of the Plan, such powers to
include the authority (within the limitations described herein) to prescribe the
form of the Agreements evidencing Grants under the terms of this Plan. The
Committee 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, consistent with the provisions of the Plan. Any decision of
the Committee in the administration of the Plan, as described herein, shall be
final and conclusive. The Committee may act only by a majority of its members in
office, except that the members thereof 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 Committee. No member of the Committee shall
be liable for anything done or omitted to be done by such member or by any other
member of the Committee in connection with the Plan, except in circumstances
involving actual bad faith. All costs and expenses of administering the Plan
shall be borne by the Company.
Article IV
GRANTS OF OPTIONS
Every Non-Employee Director who serves on the Board during the term of
the Plan is eligible to receive Grants. Each Non-Employee Director serving on
the Board as of the effective date of this Plan shall be granted an Option on
such date. Every Non-Employee Director who continues to serve in such capacity
on the date which is the first business day following each Annual Meeting of
Shareholders during the term of this Plan shall be granted an Option on each
such date. Each Option shall be for the purchase by the Participant of 1,000
shares of Common Stock at a price per share equal to the Fair Market Value of a
share of the Common Stock on the date of the Grant. Each Option shall be
evidenced by an Agreement issued by the Committee in the form prescribed by the
Committee and consistent with the terms of this Plan.
Article V
AMOUNT OF STOCK
The total number of shares of Common Stock reserved and available for
issuance upon exercise of Options granted under the Plan shall be 100,000
shares, subject to adjustment as provided in Article VIII below. The Common
Stock to be issued may be either authorized and unissued shares, issued shares
acquired by the Company or its Subsidiaries or any combination thereof. In the
event that an Option is terminated, in whole or in part, for any reason other
than its exercise, the number of shares of Common Stock allocated to such Option
or terminated portion thereof may be reallocated to other Options to be granted
under this Plan. In the event that the number of shares of Common Stock
available for future Grants under the Plan is insufficient to make all automatic
Grants required to be made on such date, then all Non-Employee Directors shall
share ratably in the number of Options available for Grants under the Plan.
Article VI
EXERCISE OF OPTIONS
6.01 Exercisability. Each Option shall be first exercisable on the date
which is six months from the date of the grant of the Option and shall continue
to be exercisable for a term of ten years thereafter; provided however, that:
(i) subject to the six month exercisability requirement set forth above, an
Option shall be exercisable, in the event of a Participant's death prior to
exercising the Option, by his estate, or the person or persons to whom his
rights under the Option shall pass by will or the laws of descent and
distribution but only for a period of two years from the date of the
Participant's death or during the remainder of the period preceding the
expiration of the Option, whichever is shorter; (ii) subject to the six month
exercisability requirement set forth above, an Option shall be exercisable, if a
Participant becomes permanently and totally disabled (within the meaning of
Section 105(d)(4) of the Code) while serving on the Board prior to exercising
the Option, but only for a period of two years from the date on which he ceases
serving on the Board due to such disability or during the remainder of the
period preceding the expiration of the Option, whichever is shorter; and (iii)
subject to the six month exercisability requirement set forth above, in the
event that a Participant resigns from or is not re-elected or does not stand for
re-election to the Board or in any other circumstance approved by the Board in
its sole discretion, an Option shall be exercisable but only for a period of two
years following the date of his resignation or cessation of service on the
Board, or in the period prescribed by the Board in an approved circumstance, or
during the remainder of the period preceding the expiration of the Option,
whichever is shorter.
6.02 Transferability. Any Option granted hereunder will be
nontransferable and, accordingly, shall not be assignable, alienable, salable or
otherwise transferable by any Participant, unless the Participant's Agreement,
as determined in the discretion of the Committee, expressly authorizes all or a
portion of the Options to be granted to the Participant on terms which permit
transfer by such Participant to (i) the spouse, children or grandchildren of the
Participant ("Immediately Family Members"), (ii) a trust or trusts for the
exclusive benefit of such Immediately Family Members, or (iii) a partnership in
which such Immediate Family Members are the only partners, provided that (x)
there may be no consideration for any such transfer, (y) the Agreement pursuant
to which Options are granted must be approved by the Committee and must
expressly provide for transferability in a manner consistent with this Article,
and (z) subsequent transfers of transferred Options shall be prohibited except
those transferred by will or the laws of descent and distribution. Following
transfer, any such Options shall continue to be subject to the same terms and
conditions as were applicable immediately prior to transfer, provided that for
purposes of this Article VI, the term Participant shall be deemed to refer to
the transferee. The events of resignation from or cessation of Board service of
this Article shall continue to be applied with respect to the original
Participant to whom the Option was granted, following which the Option shall be
exercisable by the transferee only to the extent, and for the period specified
in this Article VI.
Article VII
MANNER OF EXERCISE
7.01 Exercise. Subject to the provisions of Article VI, an Option may
be exercised in whole at any time or in part from time to time. An Option
granted under this Plan may be exercised with respect to any number of whole
shares less than the full number for which the Option could be exercised. Such
partial exercise of an Option shall not affect the right to exercise the Option
from time to time in accordance with this Plan with respect to remaining shares
subject to the Option.
7.02 Payment. Payment of the Option Price may be made in cash or by
surrendering previously-owned shares of Common Stock to the Company, provided
the shares surrendered have a Fair Market Value (determined as of the day
preceding the date of exercise) that is not less than such Option Price or part
thereof.
7.03 Cashless Exercise. To the extent permitted under applicable laws
and regulations, at the request of the Participant, the Company will cooperate
in a "cashless exercise" of an Option. The cashless exercise shall be effected
by the Participant delivering to the Securities Broker instructions to exercise
all or part of the Option, including instructions to sell a sufficient number of
shares of Common Stock to cover the costs and expenses associated therewith.
7.04 Shareholder Rights. No Participant shall have any rights as a
shareholder with respect to shares subject to an Option until the date he
exercises such Option.
Article VIII
ADJUSTMENT UPON CHANGE IN COMMON STOCK
Should the Company effect one or more (x) stock dividends, stock
split-ups, subdivisions or consolidations of shares or other similar changes in
capitalization; (y) spin-offs, spin-outs, split-ups, split-offs, or other such
distribution of assets to shareholders; or (z) direct or indirect assumptions
and/or conversions of outstanding options due to an acquisition of the Company,
then the maximum number of shares as to which Grants may be issued under this
Plan and the number and price of shares of Common Stock subject to Grants shall
be proportionately adjusted, and the terms of Options shall be adjusted, as the
Committee shall determine to be equitably required to retain for the
Participants the equivalent economic benefit of their Option(s). Any
determination made under this Article VIII by the Committee shall be final and
conclusive.
The issuance by the Company of shares of Common Stock or securities
convertible into shares of Common Stock, for cash or property or for labor or
services, either upon direct sale or upon the exercise of rights or warrants to
subscribe therefor, or upon conversion of shares or obligations of the Company
convertible into such shares or other securities, shall not affect, and no
adjustment by reason thereof shall be made with respect to any Grant.
Article IX
COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES
No Option shall be exercisable, no Common Stock shall be issued, no
certificates for shares of Common Stock shall be delivered, and no payment shall
be made under this Plan except in compliance with all applicable federal and
state laws and regulations (including, without limitation, withholding tax
requirements, if any) and the rules of all domestic stock exchanges on which the
Company's shares may be listed. The Company may rely on an opinion of its
counsel as to such compliance. Any share certificate issued to evidence Common
Stock for which an Option is exercised may bear such legends and statements as
the Committee may deem advisable to assure compliance with federal and state
laws and regulations. No Grant shall be exercisable, no Common Stock shall be
issued, and no certificate for shares shall be delivered until the Company has
obtained such consent or approval as the Committee may deem advisable from
regulatory bodies having jurisdiction over such matters.
Article X
GENERAL PROVISIONS
10.01 Rules of Construction. Headings are given to the articles and
sections of this Plan for ease of reference. The reference to any statute,
regulation, or other provision of law shall be construed to refer to any
amendment to or successor of such provision of law.
10.02 Amendment. The Board may amend or terminate this Plan from time
to time; provided, however, that the Board may amend no more often than once
every six months and no amendment may become effective until shareholder
approval is obtained if the amendment would increase the number of shares that
may be issued hereunder pursuant to Options, increase the benefits to
Participants under the Plan, or change the requirements as to eligibility for
participation in the Plan. No amendment shall, without a Participant's consent,
adversely affect any rights of such Participant under any Grant outstanding at
the time such amendment is made except if such an amendment is made to cause the
Plan or a Grant to qualify for the Rule 16b-3 exemption. No amendment shall be
made if it would disqualify the Plan from the exemption provided by Rule 16b-3.
10.03 No Right. 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.
10.04 Unfunded Plan. 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 issuance of shares upon exercise of Options shall be
subordinated to the claims of the Company's general creditors.
10.05 Acceptance. By accepting any Option or other benefit under the
Plan, each Participant and each person claiming under or through such person
shall be conclusively deemed to have indicated his acceptance and ratification
of, and consent to, any action taken under the Plan by the Company or the Board.
10.06 Rule 16b-3 Compliance. It is the intention of the Company that
the Plan comply in all respects with Rule 16b-3, that any ambiguities or
inconsistencies in construction of the Plan be interpreted to give effect to
such intention and that if any provision of the Plan is found not to be in
compliance with Rule 16b-3, such provision shall be deemed null and void to the
extent required to permit the Plan to comply with Rule 16b-3. The Board may
adopt rules and regulations under, and amend, the Plan in furtherance of the
intent of the foregoing.
10.07 Term of Plan. No Grant may be issued under this Plan before the
effective date of the Plan or after the first business day following the 2004
Annual Meeting of Shareholders (the "Termination Date"). Grants issued on or
before the Termination Date shall remain valid in accordance with their terms.
10.08 Effective Date. This Amended and Restated Plan has been approved
by the Board of Directors of the Company, effective as of December 3, 1998.
