| 1. |
ESTABLISHMENT, EFFECTIVE DATE AND TERM
|
| 2. |
PURPOSE AND PERMITTED AWARDS
|
| 3. |
ELIGIBILITY
|
| (a) |
The Eligible Individual was not previously an employee or member of the Board of Directors, or the Eligible Individual is to become employed by the Company or any member of the Company Group following a bona-fide
period of non-employment and non-service; and
|
| (b) |
The grant of the Award or Awards to the Eligible Individual is an inducement material to the Eligible Individual’s entering into employment with the Company (or another member of the Company Group) in accordance
with the Company Guide.
|
| 4. |
ADMINISTRATION
|
| (a) |
Committee. The Plan
shall be administered by the Committee, which shall have the full power and authority to take all actions, and to make all determinations not inconsistent with the specific terms and provisions of the Plan, including Section 3, and deemed
by the Committee to be necessary or appropriate to the administration of the Plan, any Award granted or any Award Agreement entered into hereunder. The Committee may correct any defect or supply any omission or reconcile any inconsistency
in the Plan or in any Award Agreement in the manner and to the extent it shall deem expedient to carry the Plan into effect as it may determine in its sole discretion. The decisions by the Committee shall be final, conclusive and binding
with respect to the interpretation and administration of the Plan, any Award or any Award Agreement entered into under the Plan. The Committee may, in its sole discretion, accelerate the vesting, exercisability or lapse of restrictions
with respect to any Award, provided that the exercise of such discretion is not otherwise prohibited by the Plan or violates the requirements of the Code.
|
| (b) |
Delegation to Officers or Employees. The Committee may designate officers or employees of the Company to assist the Committee in the administration of the Plan. The Committee may delegate authority to officers or employees of the Company to execute Award
Agreements or other documents on behalf of the Committee in connection with the administration of the Plan, subject to whatever limitations or restrictions the Committee may impose in accordance with applicable law and to the extent that
such delegation will not result in the loss of an exemption under Rule 16b‑3(d)(1) for Awards granted to Participants subject to Section 16 of the Exchange Act in respect of the Company and will not result in a related-person transaction
with an executive officer required to be disclosed under Item 404(a) of Regulation S-K (in accordance with Instruction 5.a.ii thereunder) under the Exchange Act. The Committee may not delegate authority to grant Awards other than in
accordance with Section 4(c) of the Plan.
|
| (e) |
Participants Outside the U.S. In order to conform with the provisions of local laws and regulations of foreign countries which may affect the Awards or the Participants, the Committee shall have the sole discretion to (i) modify the terms and conditions
of the Awards granted under the Plan to Eligible Individuals located outside the United States; (ii) establish subplans with such modifications as may be necessary or advisable under the circumstances present by local laws and
regulations; and (iii) take any action which it deems advisable to comply with or otherwise reflect any necessary governmental regulatory procedures, or to obtain any exemptions or approvals necessary with respect to the Plan or any
subplan established hereunder.
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| (f) |
Liability and Indemnification. No Covered Individual shall be liable for any action or determination made in good faith with respect to the Plan, any Award granted hereunder or any Award Agreement entered into hereunder. The Company shall, to the maximum
extent permitted by applicable law and its Certificate of Incorporation and Bylaws, indemnify and hold harmless each Covered Individual against any cost or expense (including reasonable attorney fees reasonably acceptable to the Company)
or liability (including any amount paid in settlement of a claim with the approval of the Company), and amounts advanced to such Covered Individual necessary to pay the foregoing at the earliest time and to the fullest extent permitted,
arising out of any act or omission to act in connection with the Plan, any Award granted hereunder or any Award Agreement entered into hereunder. Such indemnification shall be in addition to any rights of indemnification such individuals
may have under other agreements, applicable law or under the Certificate of Incorporation or Bylaws of the Company. Notwithstanding anything else herein, this indemnification will not apply to the actions or determinations made by a
Covered Individual with regard to Awards granted to such Covered Individual under the Plan or arising out of such Covered Individual’s own fraud or bad faith.
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| 5. |
SHARES OF COMMON STOCK SUBJECT TO THE PLAN
|
| (b) |
Reduction of Shares Available for Awards. Upon the granting of an Award, the number of shares of Common Stock available for issuance under this Section for the granting of further Awards shall be reduced as follows:
|
| (i) |
In connection with the granting of an Non-Qualified Stock Option or Stock Appreciation Right, the number of shares of Common Stock shall be reduced by the number of shares of Common Stock subject to the
Non-Qualified Stock Option or Stock Appreciation Right;
|
| (ii) |
In connection with the granting of an Award that is settled in Common Stock, other than the granting of an Non-Qualified Stock Option or Stock Appreciation Right, the number of shares of Common Stock shall be
reduced by the number of shares of Common Stock subject to the Award; and
|
| (iii) |
Awards settled in cash or property other than Common Stock shall not count against the total number of shares of Common Stock available to be granted pursuant to the Plan.
|
| (c) |
Cancelled, Forfeited or Surrendered Awards. Notwithstanding anything to the contrary in the Plan, if any Award is cancelled, forfeited or terminated for any reason prior to exercise, delivery or becoming vested in full, the shares of Common Stock that
were subject to such Award shall, to the extent cancelled, forfeited or terminated, immediately become available for future Awards granted under the Plan, as if said Awards had never been granted; provided, however, that any shares of Common Stock subject to an Award that is cancelled, forfeited or terminated in order to pay the exercise price, purchase price or any taxes or tax withholdings on an
Award shall not be available for future Awards granted under the Plan.
|
| 6. |
NON-QUALIFIED STOCK OPTIONS
|
| (a) |
Grant of Non-Qualified Stock Options. Subject to the terms and conditions of the Plan, including Section 3, the Committee may grant to such Eligible Individuals as the Committee may determine, Non-Qualified Stock Options to purchase such number of shares of
Common Stock and on such terms and conditions as the Committee shall determine in its sole and absolute discretion. Each grant of an Non-Qualified Stock Option shall satisfy the requirements set forth in this Section.
|
| (b) |
Type of Options. No
options other than Non-Qualified Stock Options may be granted under the Plan.
|
| (c) |
Exercise Price. The
Exercise Price of a Non-Qualified Stock Option shall be fixed by the Committee and stated in the respective Award Agreement, provided that the Exercise Price of the shares of
Common Stock subject to such Non-Qualified Stock Option may not be less than Fair Market Value of such Common Stock on the Grant Date, or if greater, the par value of the Common Stock.
|
| (d) |
Limitation on Non-Qualified Stock Option Period. Any Non-Qualified Stock Options granted under the Plan and all rights to purchase Common Stock thereunder shall terminate no later than the tenth anniversary of the Grant Date of such Non-Qualified Stock
Option or on such earlier date as may be stated in the Award Agreement relating to such Non-Qualified Stock Option. In the case of a Non-Qualified Stock Option expiring prior to the tenth anniversary of the Grant Date, the Committee may
in its discretion, at any time prior to the expiration or termination of said Non-Qualified Stock Option, extend the term of such Non-Qualified Stock Options for such additional period as it may determine, but in no event beyond the tenth
anniversary of the Grant Date thereof.
|
| (e) |
Vesting Schedule and Conditions. No Non-Qualified Stock Options may be exercised prior to the satisfaction of the conditions and vesting schedule provided for in the Plan and in the Award Agreement relating thereto. Except as otherwise provided by the
Committee, Non-Qualified Stock Options covered by any Award under the Plan that are subject solely to a future service requirement shall vest, subject to Sections 11 and 12 of the Plan, as follows: (i) 20% of the Non-Qualified Stock
Options subject to an Award shall vest immediately upon the Grant Date; and (ii) the remaining 80% of the Non-Qualified Stock Options subject to an Award shall vest over the four-year period immediately following the Grant Date in equal
annual increments of 20%, with one increment vesting on each anniversary date of the Grant Date.
|
| (f) |
Exercise. When the
conditions to the exercise of an Non-Qualified Stock Option have been satisfied, the Participant may exercise the Non-Qualified Stock Option only in accordance with the following provisions. The Participant shall deliver to the Company a
written notice stating that the Participant is exercising the Non-Qualified Stock Option and specifying the number of shares of Common Stock which are to be purchased pursuant to the Non-Qualified Stock Option, and such notice shall be
accompanied by payment in full of the Exercise Price of the shares for which the Non-Qualified Stock Option is being exercised, by one or more of the methods provided for in the Plan. Said notice must be delivered to the Company at its
principal office and addressed to the attention of the Chief Financial Officer. An attempt to exercise any Non-Qualified Stock Option granted hereunder other than as set forth in the Plan shall be invalid and of no force and effect.
|
| (g) |
Payment. Payment of the
Exercise Price for the shares of Common Stock purchased pursuant to the exercise of an Non-Qualified Stock Option shall be made by one of the following methods:
|
| (i) |
by cash, certified or cashier’s check, bank draft or money order;
|
| (ii) |
through the delivery to the Company of shares of Common Stock which have been previously owned by the Participant for the requisite period necessary to avoid a charge to the Company’s earnings for financial
reporting purposes; such shares shall be valued, for purposes of determining the extent to which the Exercise Price has been paid thereby, at their Fair Market Value on the date of exercise; without limiting the foregoing, the Committee may
require the Participant to furnish an opinion of counsel acceptable to the Committee to the effect that such delivery would not result in the Company incurring any liability under Section 16(b) of the Exchange Act; or
|
| (iii) |
by any other method which the Committee, in its sole and absolute discretion and to the extent permitted by applicable law, may permit, including, but not limited to through a “cashless exercise sale and
remittance procedure” pursuant to which the Participant shall concurrently provide irrevocable instructions (A) to a brokerage firm approved by the Committee to effect the immediate sale of the purchased shares and remit to the Company, 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, employment, excise, foreign and other taxes
required to be withheld by the Company by reason of such exercise and (B) to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale.
|
| (h) |
Termination of Employment. Unless otherwise provided in an Award Agreement, upon the termination of the employment of a Participant with the Company Group for any reason, all of the Participant’s outstanding Non-Qualified Stock Options (whether
vested or unvested) shall be subject to the rules of this paragraph. Upon such termination, the Participant’s unvested Non-Qualified Stock Options shall expire. Notwithstanding anything in the Plan to the contrary, the Committee may
provide, in its sole and absolute discretion, that following the termination of employment of a Participant with the Company Group for any reason (i) any unvested Non-Qualified Stock Options held by the Participant that vest solely upon a
future service requirement shall vest in whole or in part, at any time subsequent to such termination of employment, and/or (ii) a Participant or the Participant’s estate, devisee or heir at law (whichever is applicable), may exercise an
Non-Qualified Stock Option, in whole or in part, at any time subsequent to such termination of employment and prior to the termination of the Non-Qualified Stock Option pursuant to its terms that are unrelated to termination of
employment. Unless otherwise determined by the Committee, temporary absence from employment because of illness, vacation, approved leaves of absence or military service shall not constitute a termination of employment.
|
| (i) |
Termination for Reason other than Cause, Disability or Death. If a Participant’s termination of employment is for any reason other than death, Disability, by the Company for Cause, any Non-Qualified Stock Option held by such Participant may be
exercised, to the extent exercisable at termination, by the Participant at any time within a period not to exceed ninety (90) days from the date of such termination, but in no event after the termination of the Non-Qualified Stock Option
pursuant to its terms that are unrelated to termination of employment.
|
| (ii) |
Disability. If a Participant’s termination of employment with the Company is by reason of a Disability of such Participant, any Non-Qualified Stock Option held by such Participant may be exercised, to the extent exercisable at
termination, by the Participant at any time within a period not to exceed one (1) year after such termination, but in no event after the termination of the Non-Qualified Stock Option pursuant to its terms that are unrelated to termination
of employment; provided, however, that if the Participant dies within such period, any vested Non-Qualified Stock Option held by such Participant upon death shall be exercisable
by the Participant’s estate, devisee or heir at law (whichever is applicable) for a period not to exceed one (1) year after the Participant’s death, but in no event after the termination of the Non-Qualified Stock Option pursuant to its
terms that are unrelated to termination of employment.
|
| (iii) |
Death. If
a Participant dies while in the employment of the Company Group, any Non-Qualified Stock Option held by such Participant may be exercised, to the extent exercisable at termination, by the Participant’s estate or the devisee named in the
Participant’s valid last will and testament or the Participant’s heir at law who inherits the Non-Qualified Stock Option, at any time within a period not to exceed one (1) year after the date of such Participant’s death, but in no event
after the termination of the Non-Qualified Stock Option pursuant to its terms that are unrelated to termination of employment.
|
| (iv) |
Termination for Cause. In the event the termination is for Cause, any Non-Qualified Stock Option held by the Participant at the time of such termination shall be deemed to have terminated and expired upon the date of such termination.
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| 7. |
STOCK APPRECIATION RIGHTS
|
| (a) |
Grant of Stock Appreciation Rights. Subject to the terms and conditions of the Plan, including Section 3, the Committee may grant to such Eligible Individuals as the Committee may determine, Stock Appreciation Rights, in such amounts and on such terms and
conditions, as the Committee shall determine in its sole and absolute discretion. Each grant of a Stock Appreciation Right shall satisfy the requirements as set forth in this Section.
|
| (b) |
Terms and Conditions of Stock Appreciation Rights. Unless otherwise provided in an Award Agreement, the terms and conditions (including, without limitation, the limitations on the Exercise Price, exercise period, repricing and termination) of the Stock
Appreciation Right shall be substantially identical (to the extent possible taking into account the differences related to the character of the Stock Appreciation Right) to the terms and conditions that would have been applicable under
Section 6 above were the grant of the Stock Appreciation Rights a grant of an Non-Qualified Stock Option.
|
| (c) |
Exercise of Stock Appreciation Rights. Stock Appreciation Rights shall be exercised by a Participant only by written notice delivered to the Chief Executive Officer or Chief Financial Officer of the Company, specifying the number of shares of Common Stock with
respect to which the Stock Appreciation Right is being exercised.
|
| (d) |
Payment of Stock Appreciation Right. Unless otherwise provided in an Award Agreement, upon exercise of a Stock Appreciation Right, the Participant or Participant’s estate, devisee or heir at law (whichever is applicable) shall be entitled to receive payment,
in cash, in shares of Common Stock, or in a combination thereof, as determined by the Committee in its sole and absolute discretion. The amount of such payment shall be determined by multiplying the excess, if any, of the Fair Market
Value of a share of Common Stock on the date of exercise over the Fair Market Value of a share of Common Stock on the Grant Date, by the number of shares of Common Stock with respect to which the Stock Appreciation Rights are then being
exercised. Notwithstanding the foregoing, the Committee may limit in any manner the amount payable with respect to a Stock Appreciation Right by including such limitation in the Award Agreement.
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| 8. |
RESTRICTED STOCK
|
| (a) |
Grant of Restricted Stock. Subject to the terms and conditions of the Plan, including Section 3, the Committee may grant to such Eligible Individuals as the Committee may determine, Restricted Stock, in such amounts and on such terms and conditions
as the Committee shall determine in its sole and absolute discretion. Each grant of Restricted Stock shall satisfy the requirements as set forth in this Section.
|
| (b) |
Restrictions. The
Committee shall impose such restrictions on any Restricted Stock granted pursuant to the Plan as it may deem advisable including, without limitation, time-based vesting restrictions or the attainment of Performance Goals. Except as
otherwise provided by the Committee in its sole and absolute discretion and subject to Sections 11 and 12 of the Plan, Restricted Stock covered by any Award under the Plan that are subject solely to a future service requirement shall vest
over the four-year period immediately following the Grant Date in equal annual increments of 25%, with one increment vesting on each anniversary date of the Grant Date.
|
| (c) |
Certificates and Certificate Legend. With respect to a grant of Restricted Stock, the Company may issue a certificate evidencing such Restricted Stock to the Participant or issue and hold such shares of Restricted Stock for the benefit of the Participant until
the applicable restrictions expire. The Company may legend the certificate representing Restricted Stock to give appropriate notice of such restrictions. In addition to any such legends, each certificate representing shares of Restricted
Stock granted pursuant to the Plan shall bear the following legend:
|
| (d) |
Removal of Restrictions.
Except as otherwise provided in the Plan or the Award Agreement, shares of Restricted Stock shall become freely transferable by the Participant upon the lapse of the applicable restrictions. Once the shares of Restricted Stock are
released from the restrictions, the Participant shall be entitled to have the legend required by paragraph (c) above removed from the share certificate evidencing such Restricted Stock and the Company shall pay or distribute to the
Participant all dividends and distributions held in escrow by the Company with respect to such Restricted Stock, if any.
|
| (e) |
Stockholder Rights.
Unless otherwise provided in an Award Agreement, until the expiration of all applicable restrictions, (i) the Restricted Stock shall be treated as outstanding, (ii) the Participant holding shares of Restricted Stock may exercise full
voting rights with respect to such shares, and (iii) the Participant holding shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid with respect to such shares while they are so held. All
dividends and distributions shall be held in escrow by the Company (subject to the same restrictions on forfeitability) until all restrictions on the respective Restricted Stock have lapsed. If any such dividends or distributions are paid
in shares of Common Stock, such shares shall be subject to the same restrictions on transferability and forfeitability as the shares of Restricted Stock with respect to which they were paid.
|
| (f) |
Termination of Employment. Unless otherwise provided in an Award Agreement, if a Participant’s employment with the Company Group terminates for any reason, all unvested shares of Restricted Stock held by the Participant and any dividends or
distributions held in escrow by the Company with respect to such Restricted Stock shall be forfeited immediately and returned to the Company. Notwithstanding this paragraph, all grants of Restricted Stock that vest solely upon the
attainment of Performance Goals shall be treated pursuant to the terms and conditions that would have been applicable under Section 9 hereof as if such grants of Restricted Stock were Awards of Performance Shares, to the extent such terms
and conditions are applicable to shares of Restricted Stock. Notwithstanding anything in the Plan to the contrary, the Committee may provide, in its sole and absolute discretion, that following the termination of employment of a
Participant with the Company for any reason, any unvested shares of Restricted Stock held by the Participant that vest solely upon a future service requirement shall vest in whole or in part, at any time subsequent to such termination of
employment.
|
| 9. |
PERFORMANCE SHARES, PERFORMANCE UNITS AND RSUs
|
| (a) |
Grant of Performance Shares, Performance Units and RSUs. Subject to the terms and conditions of the Plan, including Section 3, the Committee may grant to such Eligible Individuals as the Committee may determine, Performance Shares, Performance
Units and RSUs, in such amounts and on such terms and conditions as the Committee shall determine in its sole and absolute discretion. Each grant of a Performance Share, a Performance Unit or an RSU shall satisfy the requirements as set
forth in this Section.
|
| (b) |
Performance Goals.
Performance Goals will be based on one or more of the following criteria, as determined by the Committee in its absolute and sole discretion: (i) the attainment of certain target levels of, or a specified increase in, the Company’s
enterprise value or value creation targets; (ii) the attainment of certain target levels of, or a percentage increase in, the Company’s after-tax or pre-tax profits including, without limitation, that attributable to the Company’s
continuing and/or other operations; (iii) the attainment of certain target levels of, or a specified increase relating to, the Company’s operational cash flow or working capital, or a component thereof; (iv) the attainment of certain
target levels of, or a specified decrease relating to, the Company’s operational costs, or a component thereof; (v) the attainment of a certain level of reduction of, or other specified objectives with regard to limiting the level of
increase in all or a portion of bank debt or other of the Company’s long-term or short-term public or private debt or other similar financial obligations of the Company, which may be calculated net of cash balances and/or other offsets
and adjustments as may be established by the Committee; (vi) the attainment of a specified percentage increase in earnings per share or earnings per share from the Company’s continuing operations; (vii) the attainment of certain target
levels of, or a specified percentage increase in, the Company’s net sales, revenues, net income or earnings before income tax or other exclusions; (viii) the attainment of certain target levels of, or a specified increase in, the
Company’s return on capital employed or return on invested capital; (ix) the attainment of certain target levels of, or a percentage increase in, the Company’s after-tax or pre-tax return on stockholder equity; (x) the attainment of
certain target levels in the fair market value of the Company’s Common Stock; (xi) the growth in the value of an investment in the Common Stock assuming the reinvestment of dividends; (xii) the attainment of certain target levels of, or a
specified increase in, EBITDA (earnings before income tax, depreciation and amortization); and/or attainment of synergies and cost reductions in connection with mergers, acquisitions and similar corporate transactions involving the
Company. In addition, Performance Goals may be based upon the attainment by a subsidiary, division or other operational unit of the Company of specified levels of performance under one or more of the measures described above. Further, the
Performance Goals may be based upon the attainment by the Company (or a subsidiary, division, facility or other operational unit of the Company) of specified levels of performance under one or more of the foregoing measures relative to
the performance of other corporations. Performance Goals may include a threshold level of performance below which no Award will be earned, levels of performance at which an Award will become partially earned and a level at which an Award
will be fully earned.
|
| (c) |
Terms and Conditions.
|
| (i) |
Performance Shares and Performance Units. The applicable Award Agreement shall set forth (A) the number of Performance Shares or the dollar value of Performance Units granted to the Participant; (B) the Performance Period and
Performance Goals with respect to each such Award; (C) the threshold, target and maximum shares of Common Stock or dollar values of each Performance Share or Performance Unit and corresponding Performance Goals; and (D) any other terms
and conditions as the Committee determines in its sole and absolute discretion. The Committee shall establish, in its sole and absolute discretion, the Performance Goals for the applicable Performance Period for each Performance Share or
Performance; Unit granted hereunder. Performance Goals for different Participants and for different grants of Performance Shares and Performance Units need not be identical. Unless otherwise provided in an Award Agreement, a holder of
Performance Shares or Performance Units is not entitled to the rights of a holder of Common Stock.
|
| (ii) |
RSUs. The
applicable Award Agreement shall set forth such terms and conditions with respect to the RSUs as the Committee may impose, including restrictions on transferability, risk of forfeiture and other restrictions, if any, which restrictions
may lapse separately or in combination at such times, under such circumstances, in such installments or otherwise and under such other circumstances as the Committee may determine at the date of grant or thereafter.
|
| (d) |
Determination and Payment.
|
| (i) |
Performance Shares or Performance Units Earned. Following the end of a Performance Period, the Committee shall determine the extent to which Performance Shares or Performance Units have been earned on the basis of the Company’s actual
performance in relation to the established Performance Goals as set forth in the applicable Award Agreement and shall certify these results in writing. Unless otherwise provided in the Award Agreement, the payment with respect to
Performance Shares or Performance Units shall be made within 60 days following the end of the applicable Performance Period. Unless otherwise provided in an Award Agreement, the Committee shall determine in its sole and absolute
discretion whether payment with respect to the Performance Share or Performance Unit shall be made in cash, in shares of Common Stock, or in a combination thereof.
|
| (ii) |
RSUs. Unless
provided otherwise in the Award Agreement, Restricted Stock Units shall be paid within 60 days following the date on which the restrictions on the RSUs lapse.
|
| (i) |
Termination for Reason Other Than Death or Disability. If a Participant’s employment with the Company Group terminates prior to the expiration of a Performance Period with respect to any Performance Units or Performance Shares held by such
Participant for any reason other than death or Disability, the outstanding Performance Units or Performance Shares held by such Participant for which the Performance Period has not yet expired shall terminate upon such termination and the
Participant shall have no further rights pursuant to such Performance Units or Performance Shares.
|
| (ii) |
Termination of Employment for Death or Disability. If a Participant’s employment with the Company Group terminates by reason of the Participant’s death or Disability prior to the end of a Performance Period, the Participant, or the
Participant’s estate, devisee or heir at law (whichever is applicable) shall be entitled to a payment of the Participant’s outstanding Performance Units and Performance Shares, pursuant to the terms of the Plan and the Participant’s Award
Agreement; provided, however, that the Participant shall be deemed to have earned only that proportion (to the nearest whole unit or share) of the Performance Units or Performance
Shares granted to the Participant under such Award as the number of full months of the Performance Period which have elapsed since the first day of the Performance Period for which the Award was granted to the end of the month in which
the Participant’s termination of employment, bears to the total number of months in the Performance Period, subject to the attainment of the Performance Goals associated with the Award as certified by the Committee. The remaining
Performance Units or Performance Shares and any rights with respect thereto shall be canceled and forfeited.
|
| 10. |
OTHER AWARDS
|
| 11. |
CHANGE IN CONTROL
|
| 12. |
CHANGE IN STATUS OF PARENT OR SUBSIDIARY
|
| 13. |
REQUIREMENTS OF LAW
|
| (a) |
Violations of Law. The
Company shall not be required to make any payments, sell or issue any shares of Common Stock under any Award if the sale or issuance of such shares would constitute a violation by the individual exercising the Award, the Participant or
the Company of any provisions of any law or regulation of any governmental authority, including without limitation any provisions of the Sarbanes-Oxley Act, and any other federal or state securities laws or regulations. Any determination
in this connection by the Committee shall be final, binding, and conclusive. The Company shall not be obligated to take any affirmative action in order to cause the exercise of an Award, the issuance of shares pursuant thereto, or the
grant of an Award to comply with any law or regulation of any governmental authority.
|
| (b) |
Registration. At the
time of any exercise or receipt of any Award, the Company may, if it shall determine it necessary or desirable for any reason, require the Participant (or Participant’s heirs, legatees or legal representative, as the case may be), as a
condition to the exercise or grant thereof, to deliver to the Company a written representation of present intention to hold the shares for their own account as an investment and not with a view to, or for sale in connection with, the
distribution of such shares, except in compliance with applicable federal and state securities laws with respect thereto. In the event such representation is required to be delivered, an appropriate legend may be placed upon each
certificate delivered to the Participant (or Participant’s heirs, legatees or legal representative, as the case may be) upon the Participant’s exercise of part or all of the Award or receipt of an Award and a stop transfer order may be
placed with the transfer agent. Each Award shall also be subject to the requirement that, if at any time the Company determines, in its discretion, that the listing, registration or qualification of the shares subject to the Award upon
any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition of or in connection with, the issuance or purchase of the shares
thereunder, the Award may not be exercised in whole or in part and the restrictions on an Award may not be removed unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any
conditions not acceptable to the Company in its sole discretion. The Participant shall provide the Company with any certificates, representations and information that the Company requests and shall otherwise cooperate with the Company in
obtaining any listing, registration, qualification, consent or approval that the Company deems necessary or appropriate. The Company shall not be obligated to take any affirmative action in order to cause the exercisability or vesting of
an Award, to cause the exercise of an Award or the issuance of shares pursuant thereto, or to cause the grant of Award to comply with any law or regulation of any governmental authority.
|
| (c) |
Withholding. The
Committee may make such provisions and take such steps as it may deem necessary or appropriate for the withholding of any taxes that the Company is required by any law or regulation of any governmental authority, whether federal, state or
local, domestic or foreign, to withhold in connection with the grant or exercise of an Award, or the removal of restrictions on an Award including, but not limited to: (i) the withholding of delivery of shares of Common Stock until the
holder reimburses the Company for the amount the Company is required to withhold with respect to such taxes; (ii) the canceling of any number of shares of Common Stock issuable in an amount sufficient to reimburse the Company for the
amount it is required to so withhold; (iii) withholding the amount due from any such person’s wages or compensation due to such person; or (iv) requiring the Participant to pay the Company cash in the amount the Company is required to
withhold with respect to such taxes.
|
| (d) |
Governing Law. The Plan
shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware.
|
| 14. |
GENERAL PROVISIONS
|
| (a) |
Award Agreements. All
Awards granted pursuant to the Plan shall be evidenced by an Award Agreement. Each Award Agreement shall specify the terms and conditions of the Award granted and shall contain any additional provisions as the Committee shall deem
appropriate, in its sole and absolute discretion (including, to the extent that the Committee deems appropriate, provisions relating to confidentiality, non-competition, non-solicitation and similar matters). The terms of each Award
Agreement need not be identical for Eligible Individuals provided that each Award Agreement shall comply with the terms of the Plan.
|
| (b) |
Exemptions from Section 16(b) Liability. It is the intent of the Company that the grant of any Awards to or other transaction by a Participant who is subject to Section 16 of the Exchange Act shall be exempt from Section 16 pursuant to an applicable exemption
(except for transactions acknowledged in writing to be non-exempt by such Participant and sales transactions to persons other than the Company). Accordingly, if any provision of the Plan or any Award Agreement does not comply with the
requirements of Rule 16b-3 then applicable to any such transaction, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Participant shall avoid
liability under Section 16(b). In the event Rule 16b-3 is revised or replaced, the Board, or the Committee acting on behalf of the Board, may exercise discretion to modify the Plan in any respect necessary to satisfy the requirements of
the revised exemption or its replacement.
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| (c) |
Purchase Price. To the
extent the purchase price of any Award granted hereunder is less than par value of a share of Common Stock and such purchase price is not permitted by applicable law, the per share purchase price shall be deemed to be equal to the par
value of a share of Common Stock.
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| (d) |
Deferral of Awards. The
Committee may from time to time establish procedures pursuant to which a Participant may elect to defer, until a time or times later than the vesting of an Award, receipt of all or a portion of the shares of Common Stock or cash subject
to such Award and to receive Common Stock or cash at such later time or times, all on such terms and conditions as the Committee shall determine. The Committee shall not permit the deferral of an Award unless counsel for the Company
determines that such action will not result in adverse tax consequences to a Participant under Section 409A of the Code. If any such deferrals are permitted, then notwithstanding anything to the contrary herein, a Participant who elects
to defer receipt of Common Stock shall not have any rights as a stockholder with respect to deferred shares of Common Stock unless and until shares of Common Stock are actually delivered to the Participant with respect thereto, except to
the extent otherwise determined by the Committee.
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| (e) |
Prospective Employees.
Notwithstanding anything to the contrary, any Award granted to a Prospective Employee shall not become vested prior to the date the Prospective Employee first becomes an employee of the Company.
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| (f) |
Stockholder Rights.
Except as expressly provided in the Plan or an Award Agreement, a Participant shall not have any of the rights of a stockholder with respect to Common Stock subject to the Awards prior to satisfaction of all conditions relating to the
issuance of such Common Stock, and no adjustment shall be made for dividends, distributions or other rights of any kind for which the record date is prior to the date on which all such conditions have been satisfied.
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| (g) |
Transferability of Awards. A Participant may not Transfer an Award other than by will or the laws of descent and distribution. Awards may be exercised during the Participant’s lifetime only by the Participant. No Award shall be liable for or subject
to the debts, contracts, or liabilities of any Participant, nor shall any Award be subject to legal process or attachment for or against such person. Any purported Transfer of an Award in contravention of the provisions of the Plan shall
have no force or effect and shall be null and void, and the purported transferee of such Award shall not acquire any rights with respect to such Award. Notwithstanding anything to the contrary, the Committee may in its sole and absolute
discretion permit the Transfer of an Award to a Participant’s “family member” as such term is defined in the Form S-8 Registration Statement under the Securities Act of 1933, as amended, under such terms and conditions as specified by the
Committee; provided, however, that the Participant will not directly or indirectly receive any payment of value in connection with the transfer of the Award. In such case, such
Award shall be exercisable only by the transferee approved of by the Committee.
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| (h) |
Buyout and Settlement Provisions. Except as prohibited hereunder, the Committee may at any time on behalf of the Company offer to buy out any Awards previously granted based on such terms and conditions as the Committee shall determine which shall be
communicated to the Participants at the time such offer is made.
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| (i) |
Use of Proceeds. The
proceeds received by the Company from the sale of Common Stock pursuant to Awards granted under the Plan shall constitute general funds of Company.
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| (j) |
Modification or Substitution of an Award.
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| (i) |
Generally. Subject to the terms and conditions of the Plan, the Award Agreement and applicable law (including the Code), the Committee may modify outstanding Awards, provided that, except as permitted in the Plan or the applicable
Award Agreement, no modification of an Award shall materially adversely affect any rights or obligations of the Participant under the applicable Award Agreement without the Participant’s consent. Nothing in the Plan shall limit the right
of the Company to pay compensation of any kind outside the terms of the Plan.
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| (ii) |
Limitation on Repricing. Unless such action is approved by the Company’s shareholders in accordance with applicable law: (A) no outstanding Non-Qualified Stock Option or Stock Appreciation Right granted under the Plan may be amended to provide
an Exercise Price that is lower than the then-current Exercise Price of such outstanding Non-Qualified Stock Option or Stock Appreciation Right (other than adjustments to the Exercise Price pursuant to Sections 5(d) and 11 hereof); (B)
the Committee may not cancel any outstanding Non-Qualified Stock Option or Stock Appreciation Right when its Exercise Price is equal to or greater than the Fair Market Value of the underlying Common Stock and grant in substitution
therefore new Awards, equity, cash or other property (other than adjustments pursuant to Section 11 hereof); (C) the Committee may not authorize the repurchase of an outstanding Non-Qualified Stock Option or Stock Appreciation Right which
has an Exercise Price that is higher than the then-current fair market value of the Common Stock (other than adjustments pursuant to Section 11 hereof); (D) the Committee may not cancel any outstanding Non-Qualified Stock Option or Stock
Appreciation Right and grant in substitution therefore new Awards as part of a strategy to materially enhance the position of the holder of such Non-Qualified Stock Options or Stock Appreciation Rights with respect to their value as of
the time of such substitution (other than adjustments pursuant to Section 5(d) hereof), and (E) the Committee may not take any other action that is treated as a repricing under generally accepted accounting principles (other than
adjustments pursuant to Sections 5(d) and 11 hereof). A cancellation and exchange or substitution described in clauses (B) and (D) of the preceding sentence will be considered a repricing regardless of whether the Non-Qualified Stock
Option, Restricted Stock or other equity is delivered simultaneously with the cancellation, regardless of whether it is treated as a repricing under generally accepted accounting principles, and regardless of whether it is voluntary on
the part of the Participant.
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| (l) |
Section 409A of the Code. The Award Agreement for any Award that the Committee reasonably determines to constitute “nonqualified” deferred compensation plan” under Code Section 409A (a “Section 409A Plan”),
and the provisions of the Plan applicable to that Award, shall be construed in a manner consistent with the applicable requirements of Code Section 409A, and the Committee, in its sole discretion and without the consent of any
Participant, may amend any Award Agreement (and the provisions of the Plan applicable thereto) if and to the extent that the Committee determines that such amendment is necessary or appropriate to comply with the requirements of Code
Section 409A. If any Award constitutes a Section 409A Plan, then the Award shall be subject to the following additional requirements, if and to the extent required to comply with Code Section 409A:
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| (i) |
Payments under the Section 409A Plan may not be made earlier than (A) the Participant’s “separation from service”, (B) the date the Participant becomes “disabled”, (C) the Participant’s death, (D) a “specified
time (or pursuant to a fixed schedule)” specified in the Award Agreement at the date of the deferral of such compensation, (E) a “change in the ownership or effective control of the corporation, or in the ownership of a substantial portion
of the assets: of the corporation, or (F) the occurrence of an “unforeseeable emergency”;
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| (ii) |
The time or schedule for any payment of the deferred compensation may not be accelerated, except to the extent provided in applicable Treasury Regulations or other applicable guidance issued by the Internal
Revenue Service;
|
| (iii) |
Any elections with respect to the deferral of such compensation or the time and form of distribution of such deferred compensation shall comply with the requirements of Code Section 409A(a)(4); and
|
| (iv) |
In the case of any Participant who is a “specified employee”, a distribution on account of a “separation from service” may not be made before the date which is six months after the date of the Participant’s
“separation from service” (or, if earlier, the date of the Participant’s death).
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| (v) |
For purposes of the foregoing, the terms in quotations shall have the same meanings as those terms have for purposes of Code Section 409A, and the limitations set forth herein shall be applied in such manner (and
only to the extent) as shall be necessary to comply with any requirements of Code Section 409A that are applicable to the Award.
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| (m) |
Notification of 83(b) Election. If in connection with the grant of any Award, any Participant makes an election permitted under Code Section 83(b), such Participant must notify the Company in writing of such election within ten days of filing such
election with the Internal Revenue Service.
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| (p) |
Unfunded Status of Plan.
The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments as to which a Participant has a fixed and vested interest but which are not yet made to such Participant by the
Company, nothing contained herein shall give any such Participant any rights that are greater than those of a general creditor of the Company
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| (q) |
Nonexclusivity of Plan.
The Non-Qualified Stock Option of the Plan shall not be construed as creating any limitations upon the right and authority of the Board to adopt such other incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individuals or specifically to a particular individual or individuals) as the Board in its sole and absolute discretion determines desirable.
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| (r) |
Other Benefits. No
Award payment under the Plan shall be deemed compensation for purposes of computing benefits under any retirement plan of the Company or any agreement between a Participant and the Company, nor affect any benefits under any other benefit
plan of the Company now or subsequently in effect under which benefits are based upon a Participant’s level of compensation.
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| (s) |
Headings. The section
headings in the Plan are for convenience only; they form no part of this Agreement and shall not affect its interpretation.
|
| (t) |
Pronouns. The use of
any gender in the Plan shall be deemed to include all genders, and the use of the singular shall be deemed to include the plural and vice versa, wherever it appears appropriate from the context.
|
| (u) |
Successors and Assigns.
The Plan shall be binding on all successors of the Company and all successors and permitted assigns of a Participant, including, but not limited to, a Participant’s estate, devisee, or heir at law.
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| (v) |
Severability. If any
provision of the Plan or any Award Agreement shall be determined to be illegal or unenforceable by any court of law in any jurisdiction, the remaining provisions hereof and thereof shall be severable and enforceable in accordance with
their terms, and all provisions shall remain enforceable in any other jurisdiction.
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| (w) |
Notices. Any
communication or notice required or permitted to be given under the Plan shall be in writing, and mailed by registered or certified mail or delivered by hand, to the Company, to its principal place of business, attention: Chief Financial
Officer and if to the holder of an Award, to the address as appearing on the records of the Company.
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| (a) |
any “person” as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company, any
company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of common stock of the Company is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities;
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| (b) |
during any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an
agreement with the Company to effect a transaction described in paragraph (a), (c), or (d) of this Section) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the
Board;
|
| (c) |
a merger, consolidation, reorganization, or other business combination of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; provided, however, that a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no person acquires more than twenty-five percent (25%) of the combined voting power of the Company’s then outstanding securities shall not constitute a Change in
Control; or
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| (d) |
complete liquidation of the Company or the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets other than (x) the sale or disposition of all or substantially
all of the assets of the Company to a person or persons who beneficially own, directly or indirectly, at least fifty percent (50%) or more of the combined voting power of the outstanding voting securities of the Company at the time of the
sale or (y) pursuant to a spin-off type transaction, directly or indirectly, of such assets to the stockholders of the Company.
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