Document 7MyZOpJMKB1jmR5kNwMoQmn4R

MAFCO CONSOLIDATED GROUP INC (Form: 10-K, Received: 03/28/1997 00 00:0 . Page 79 of 116 accumulated postretirement benefit obligation was 7.25% at December 31, 1996 and 1995. 12. STOCK BASED COMPENSATION Under the terms of the Company's 1995 stock option plan (the "MC Group Stock Option Plan"), stock options and stock appreciation rights may be granted to key employees of the Company. A maximum of 1,250,000 shares of MC Group Common Stock have been reserved for issuance under the MC Group Stock Option Plan The MC Group options vest one-third each year beginning on the first anniversary of the date of grant and become 100% vested on the third anniversary of the date of grant. The following table summarizes the stock option transactions under the MC Group Stock Option Plan and the grant of 750,000 options to the Chairman of the Board of Directors for services rendered and to be rendered to the Company. Outstanding - beginning of year Granted Outstanding at year end Exercisable at year end Weighted average fair value of options granted during the year Weighted aaverage remaining contractual life of options outstanding (in years) YEAR ENDED DECEMBER 31, 1996 1995 OPTIONS EXERCISE PRICE OPTIONS 750,000 875,000 $ 17.38 21.57 - 750,000 1,625,000 791,667 19 63 750,000 250,000 10.08 9 27 Cigar Holdings adopted its 1996 stock plan (the "Cigar Stock Option Plan") prior to the effectiveness of the Cigar IPO Under the Cigar Stock Option Plan, incentive stock options, non-quakfied stock options, stock appreciation rights, restricted and unrestricted stock (collectively "Awards"), may be granted to selected employees, consultants and directors of Cigar Holdings, and any of its affiliates, from time to time. The aggregate number of shares of Cigar Holdings common stock as to which options and rights may be granted under the Cigar Stock Option Plan may not exceed 3,000,000 As of December 31,1996 there were 1,237,500 shares of Cigar Holdings non-qualified options outstanding that were issued to officers and employees, 1,150,000 shares at an exercise price equal to the initial public offering price of $23 00 per share and 87,500 shares at $25 00 per share. None of the Cigar Holdings option shares were exercisable at December 31, 1996 and 1,762,500 shares remained available for future grants These Cigar Holdings options vest one-third each year F-24 MAFCO CONSOLIDATED GROUP INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS beginning on the first anniversary of the date of grant and become 100% vested on the third anniversary http //www edgarpro.com/EFX dll/EDGARpro.dll?FetchFilingHTMLl?ID=969943&Ses .. 10/19/2003