Additional Proxy Soliciting Materials (definitive) (defa14a)
May 12 2017 - 4:28PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section
14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
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Filed by the
Registrant
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Filed by a Party other than the
Registrant
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CHECK THE APPROPRIATE
BOX:
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Preliminary Proxy
Statement
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Confidential, For Use
of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy
Statement
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Definitive Additional
Materials
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Soliciting Material
Under Rule 14a-12
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Layne
Christensen Company
(Name of Registrant as Specified In Its
Charter)
(Name of Person(s) Filing Proxy
Statement, if Other Than the Registrant)
PAYMENT OF FILING FEE (CHECK
THE APPROPRIATE BOX):
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No fee
required.
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Fee computed on table
below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1) Title of each class of
securities to which transaction applies:
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2) Aggregate number of securities
to which transaction applies:
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3) Per unit price or
other underlying value of transaction computed pursuant to Exchange Act
Rule 0-11 (set forth the amount on which the filing fee is calculated and
state how it was determined):
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4) Proposed maximum aggregate
value of transaction:
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5) Total fee
paid:
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Fee paid
previously with preliminary materials:
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Check box if
any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2)
and identify the filing for which the offsetting fee was paid previously.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
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1) Amount previously
paid:
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2) Form, Schedule or Registration
Statement No.:
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3) Filing Party:
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4) Date
Filed:
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Explanatory Note
On April 28, 2017, Layne Christensen
Company filed its definitive proxy statement for its Annual Meeting of
Shareholders to be held on May 31, 2017 (the 2017 Proxy Statement). Attached
is a copy of the Layne Christensen Company 2006 Equity Incentive Plan, as
proposed to be amended and restated pursuant to Item 4 of the 2017 Proxy
Statement, which was inadvertently omitted as Appendix A to the 2017 Proxy
Statement filed on April 28, 2017.
ii
Appendix A
LAYNE CHRISTENSEN
COMPANY
2006 EQUITY INCENTIVE PLAN
(As Amended and Restated)
LAYNE CHRISTENSEN
COMPANY
2006 EQUITY INCENTIVE PLAN
TABLE OF CONTENTS
SECTION 1 INTRODUCTION
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1
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1.1
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Establishment and Amendment History
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1
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1.2
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Purpose
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1
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1.3
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Duration
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1
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SECTION 2 DEFINITIONS
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1
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2.1
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Definitions
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1
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2.2
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General Interpretive Principles
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8
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SECTION 3 PLAN ADMINISTRATION
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8
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3.1
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Composition of Committee
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8
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3.2
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Authority of Committee
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8
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3.3
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Committee Delegation
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3.4
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Determination Under the Plan
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10
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SECTION 4 STOCK SUBJECT TO THE PLAN
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10
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4.1
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Number of Shares
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10
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4.2
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Unused and Forfeited Stock
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11
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4.3
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Adjustments in Authorized Shares
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11
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4.4
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General Adjustment Rules
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11
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SECTION 5 PARTICIPATION
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12
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5.1
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Basis of Grant
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12
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5.2
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Types of Grants; Limits
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12
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5.3
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Award Agreements
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12
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5.4
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Restrictive Covenants
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12
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5.5
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Maximum Annual Award
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12
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5.6
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No
Dividends or Dividend Equivalents on Unvested Awards
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12
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5.7
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Minimum Vesting / Exercise Requirements
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12
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5.8
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Clawback Policy
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13
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5.9
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Non-Employee Director Sublimit
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13
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SECTION 6 STOCK OPTIONS
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13
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6.1
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Grant of Options
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13
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6.2
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Option Agreements
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13
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6.3
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Stockholder Privileges
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SECTION 7 STOCK APPRECIATION RIGHTS
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18
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7.1
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Grant of SARs
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18
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7.2
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SAR Award Agreement
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18
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7.3
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Exercise of SARs
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7.4
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Expiration of SARs
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7.5
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Adjustment of SARs
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7.6
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Payment of SAR Amount; Automatic Exercise
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7.7
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Stockholder Privileges
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SECTION 8 AWARDS OF RESTRICTED STOCK AND
RESTRICTED STOCK UNITS
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8.1
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Restricted Stock Awards Granted by Committee
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20
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8.2
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Restricted Stock Unit Awards Granted by
Committee
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8.3
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Restrictions
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8.4
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Privileges of a Stockholder, Transferability
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8.5
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Enforcement of Restrictions
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8.6
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Termination of Service, Death, Disability,
etc.
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21
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SECTION 9 BONUS SHARES AND PERFORMANCE AWARDS;
SECTION 162(M) PROVISIONS 21
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9.1
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Awards Granted by Committee
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21
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9.2
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Bonus Shares
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9.3
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Communication of Award
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21
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9.4
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Terms of Performance Awards
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9.5
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Performance Goals
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9.6
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Determinations and Adjustments
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9.7
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Payment of Awards
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9.8
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Termination of Employment
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9.9
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Other Restrictions
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SECTION 10 REORGANIZATION, CHANGE IN CONTROL OR
LIQUIDATION
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10.1
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Change in Control
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10.2
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Acceleration Upon Involuntary Termination Following Change
in Control
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10.3
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Code Section 409A
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SECTION 11 RIGHTS OF EMPLOYEES;
PARTICIPANTS
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11.1
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Employment
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11.2
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Nontransferability
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11.3
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Permitted Transfers
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SECTION 12 GENERAL RESTRICTIONS
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12.1
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Investment Representations
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12.2
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Compliance with Securities Laws
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12.3
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Stock Restriction Agreement
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SECTION 13
OTHER EMPLOYEE BENEFITS
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SECTION 14
PLAN AMENDMENT, MODIFICATION AND
TERMINATION
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14.1
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Amendment, Modification, and Termination
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14.2
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Adjustment Upon Certain Unusual or Nonrecurring
Events
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14.3
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Awards Previously Granted
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SECTION 15
WITHHOLDING
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15.1
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Withholding Requirement
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15.2
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Withholding with Stock
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SECTION 16
NONEXCLUSIVITY OF THE PLAN
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SECTION 17
REQUIREMENTS OF LAW
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17.1
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Requirements of Law
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17.2
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Code Section 409A
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17.3
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Rule 16b-3
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17.4
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Governing Law
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iv
LAYNE CHRISTENSEN
COMPANY
2006 EQUITY INCENTIVE PLAN
(As Amended and Restated)
SECTION 1
INTRODUCTION
1.1
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Establishment and
Amendment History
. Layne
Christensen Company, a corporation organized and existing under the laws
of the state of Delaware (the Company), established effective June 8,
2006, the Layne Christensen Company 2006 Equity Incentive Plan (the
Plan) for certain employees and non-employee directors of the Company.
The Plan was last amended and restated effective June 6, 2014. Provided
the Company receives stockholder approval of this amendment and
restatement, the Plan has been amended and restated as set forth herein
effective as of May 31, 2017, (the "New Effective Date").
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1.2
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Purpose
. The purpose
of this Plan is to encourage employees of the Company and its affiliates
and subsidiaries to acquire a proprietary and vested interest in the
growth and performance of the Company. The Plan also is designed to assist
the Company in attracting and retaining employees and non-employee
directors by providing them with the opportunity to participate in the
success and profitability of the Company.
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1.3
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Duration
. The Plan
commenced on the Original Effective Date and shall remain in effect,
subject to the right of the Board to amend or terminate the Plan at any
time pursuant to Section 14 hereof, until all Shares subject to it shall
have been issued, purchased or acquired according to the Plans
provisions. Unless the Plan shall be reapproved by the stockholders of the
Company and the Board renews the continuation of the Plan, no Awards shall
be issued pursuant to the Plan after the tenth anniversary of the New
Effective Date.
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SECTION 2
DEFINITIONS
2.1
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Definitions
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following terms shall have the meanings set forth below.
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1933 Act
means the Securities Act of
1933.
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1934 Act
means the Securities
Exchange Act of 1934.
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Affiliate
of the Company means any
Person that directly, or indirectly through one or more intermediaries,
Controls or is Controlled by, or is under common Control with the
Company.
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Award
means a grant made under
this Plan in any form which may include but is not limited to Stock
Options, Restricted Stock, Restricted Stock Units, Bonus Shares,
Performance Shares, Stock Appreciation Rights and Performance
Units.
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Award Agreement
means a written or electronic
agreement or instrument between the Company and a Holder which evidences
an Award and sets forth such applicable terms, conditions and limitations
(including treatment as a Performance Award) as the Committee establishes
for the Award.
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Beneficiary
means the person, persons, trust or trusts
which have been designated by a Holder in his or her most recent written
beneficiary designation filed with the Company to receive the benefits
specified under this Plan upon the death of the Holder, or, if there is no
designated Beneficiary or surviving designated Beneficiary, then the
Person or Persons entitled by will or the laws of descent and distribution
to receive such benefits.
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Board
means the Board of Directors of
the Company.
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"
Bonus Shares
means Shares that are awarded to a
Participant without cost and without restriction in recognition of past
performance (whether determined by reference to another employee benefit
plan of the Company or otherwise) or as an incentive to become an employee
of the Company or an Affiliate.
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Cause
means, unless otherwise defined in an Award
Agreement or otherwise defined in a Participant's employment agreement (in
which case such definition will apply), any of the
following:
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(i)
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Participants
conviction of, plea of guilty to, or plea of nolo contendere to a felony
or other crime that involves fraud or dishonesty;
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(ii)
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any willful action or
omission by a Participant which would constitute grounds for immediate
dismissal under the employment policies of the Company by which
Participant is employed, including intoxication with alcohol or illegal
drugs while on the premises of the Company, or violation of sexual
harassment laws or the internal sexual harassment policy of the Company by
which Participant is employed;
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(iii)
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Participants
habitual neglect of duties, including repeated absences from work without
reasonable excuse; or
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(iv)
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Participants willful
and intentional material misconduct in the performance of his or her
duties that results in financial detriment to the Company;
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provided,
however, that for purposes of clauses (ii), (iii) and (iv), Cause shall
not include any one or more of the following: bad judgment, negligence or
any act or omission believed by the Participant in good faith to have been
in or not opposed to the interest of the Company (without intent of the
Participant to gain, directly or indirectly, a profit to which the
Participant was not legally entitled). A Participant who agrees to resign
from the Participant's affiliation with the Company in lieu of being
terminated for Cause may be deemed, in the sole discretion of the
Committee, to have been terminated for Cause for purposes of this
Plan.
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Change in
Control
means, except as
otherwise defined in an Award Agreement to comply with Section 409A of the
Code, the first to occur of the following
events:
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(i)
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Any Person is or
becomes the Beneficial Owner (within the meaning set forth in Rule 13d-3
under the 1934 Act), directly or indirectly, of securities of the Company
(not including for this purpose any securities acquired directly from the
Company or its Affiliates) representing 50% or more of the combined voting
power of the Companys then outstanding securities, excluding any Person
who becomes such a Beneficial Owner in connection with a transaction
described in clause (x) of paragraph (iii) of this definition;
or
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(ii)
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The following
individuals cease for any reason to constitute a majority of the number of
directors then serving: individuals who, on the Original Effective Date,
constitute the Board and any new director (other than a director whose
initial assumption of office is in connection with an actual or threatened
election contest, including to a consent solicitation, relating to the
election of directors of the Company) whose appointment or election by the
Board or nomination for election by the Companys stockholders was
approved by a vote of at least two-thirds of the directors then still in
office who either were directors on the Original Effective Date or whose
appointment, election or nomination for election was previously so
approved or recommended; or
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(iii)
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There is consummated
a merger or consolidation of the Company with any other corporation, OTHER
THAN (x) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior to such merger or
consolidation continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity or any
parent thereof), in combination with the ownership of any trustee or other
fiduciary holding securities under an employee benefit plan of the Company
at least 50% of the combined voting power of the securities of the Company
or such surviving entity or any parent thereof outstanding immediately
after such merger or consolidation, or (y) a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no Person is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company (not including for
this purpose any securities acquired directly from the Company or its
Affiliates other than in connection with the acquisition by the Company or
its Affiliates of a business) representing 50% or more of the combined
voting power of the Companys then outstanding securities; or
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(iv)
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The stockholders of
the Company approve a plan of complete liquidation or dissolution of the
Company or there is consummated an agreement for the sale or disposition
by the Company of all or substantially all of the Companys assets, other
than a sale or disposition by the Company of
all or substantially all of the Companys assets to an entity, at least 50% of
the combined voting power of the voting securities of which are owned by
stockholders of the Company in substantially the same proportions as their
ownership of the Company immediately prior to such sale.
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Notwithstanding the
foregoing, a Change in Control shall not be deemed to have occurred by
virtue of the consummation of any transaction or series of integrated
transactions immediately following which the record holders of the
Companys common stock immediately prior to such transaction or series of
transactions continue to have substantially the same proportionate
ownership in an entity which owns all or substantially all of the
Companys assets immediately following such transaction or series of
transactions.
Code
means the
Internal Revenue Code of 1986, as it may be amended from time to time, and
the rules and regulations promulgated thereunder.
Committee
means (i) the Board, or
(ii) one or more committees of the Board to whom the Board has delegated
all or part of its authority under this Plan.
Company
means Layne Christensen
Company, a Delaware corporation, and any successor thereto.
Control
means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person, whether through the
ownership of voting securities, by contract or otherwise.
Covered
Employee
means an Employee
that meets the definition of covered employee under Section 162(m)(3) of
the Code, or any successor provision thereto.
Date of
Grant
or
Grant Date
means, with respect to any Award, the date
as of which such Award is granted under the Plan, which date shall be the
later of (i) the date on which the Committee resolved to grant the Award
or (ii) the first day of the Service Provider's service to the Company or
an Affiliate.
Disabled or
Disability
means an
individual (i) is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months or (ii) is, by
reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months, receiving income
replacement benefits for a period of not less than 3 months under a
Company-sponsored accident and health plan. Notwithstanding the above,
with respect to an Incentive Stock Option and the period of time following
a separation from service a Holder has to exercise such Incentive Stock
Option, disabled shall have the same meaning as defined in Code section
22(e)(3).
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Eligible
Employees
means key
employees (including officers and directors who are also employees) of the
Company or an Affiliate upon whose judgment, initiative and efforts the
Company is, or will be, important to the successful conduct of its
business.
Executive
Officer
means (i) the
president of the Company, any vice president of the Company in charge of a
principal business unit, division or function (such as sales,
administration, or finance), any other officer who performs a policy
making function or any other person who performs similar policy making
functions for the Company, (ii) Executive Officers (as defined in part (i)
of this definition) of subsidiaries of the Company who perform policy
making functions for the Company, and (iii) any Person designated or
identified by the Board as being an Executive Officer for purposes of the
1933 Act or the 1934 Act, including any Person designated or identified by
the Board as being a Section 16 Person.
Fair Market
Value
means, as of any
date, the value of the Stock determined in good faith by the Committee in
its sole discretion. Such determination shall be conclusive and binding on
all persons. For this purpose the Committee may adopt such formulas as in
its opinion shall reflect the true fair market value of such Stock from
time to time and may rely on such independent advice with respect to such
fair market value determination as the Committee shall deem appropriate.
To the extent that the Stock is readily tradable on an established
securities market, the fair market value of the stock may be determined
based upon the last sale before or the first sale after the grant, the
closing price on the trading day before or the trading day of the grant,
the arithmetic mean of the high and low prices on the trading day before
or the trading day of the grant, or any other reasonable method using
actual transactions in such stock as reported by such market. To the
extent that the Stock is not readily tradable on an established market,
the fair market value of the stock as of a valuation date means a value
determined by the reasonable application of a reasonable valuation method.
The determination whether a valuation method is reasonable, or whether an
application of a valuation method is reasonable, is made based on the
facts and circumstances as of the valuation date.
Holder
means a
Participant, Beneficiary or Permitted Transferee who is in possession of
an Award Agreement representing an Award that (i) in the case of a
Participant has been granted to such individual, (ii) in the case of a
Beneficiary, has been transferred to such person under the laws of descent
and distribution or (iii) in the case of a Permitted Transferee, has been
transferred to such person as permitted by the Committee, and, with
respect to all of the above clauses (i), (ii) and (iii), such Award
Agreement has not expired, been canceled or terminated.
Incentive Stock
Option
means any Option
designated as such and granted in accordance with the requirements of
Section 422 of the Code or any successor provisions thereto.
"New Effective
Date"
means May 31, 2017,
such date being the date this amended and restated Plan was approved by
the Company's stockholders.
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Nonqualified
Stock Option
means any
Option to purchase Shares that is not an Incentive Stock Option.
Option
means a right to purchase
Stock at a stated price for a specified period of time. Such definition
includes both Nonqualified Stock Options and Incentive Stock Options.
Option
Agreement
or Option Award Agreement means a written or electronic
agreement or instrument between the Company and a Holder evidencing an
Option.
Option Exercise
Price
means the price at
which Shares subject to an Option may be purchased, determined in
accordance with Section 6.2(b).
Option
Holder
shall have the
meaning as set forth in Section 6.2. For the avoidance of any doubt, in
situations where the Option has been transferred to a Permitted Transferee
or passed to a Beneficiary in accordance with the laws of descent and
distribution, the Option Holder will not be the same person as the Holder
of the Option.
Original
Effective Date
means April
24, 2006, such date being the date this Plan was originally approved by
the Company's stockholders.
Participant
means a Service Provider of
the Company designated by the Committee from time to time during the term
of the Plan to receive one or more Awards under the Plan.
Performance
Award
means any Award that
will be issued or granted, or become vested, exercisable or payable, as
the case may be, upon the achievement of certain performance goals (as
described in Section 9) to a Participant pursuant to Section 9.
Performance
Period
means the period of
time as specified by the Committee during which any performance goals on
Performance Awards are to be measured.
Performance
Shares
means an Award made pursuant to Section 9
which entitles a Holder to receive stock, their cash equivalent, or a
combination thereof based on the achievement of performance goals during a
Performance Period.
Performance
Units
means an Award made
pursuant to Section 9 which entitles a Holder to receive cash, Shares or a
combination thereof based on the achievement of performance targets during
a Performance Period.
Person
shall have the meaning
ascribed to such term in Section 3(a)(9) of the 1934 Act and used in
Sections 13(d) and 14(d) thereof, including group as defined in Section
13(d) thereof.
Plan
means the Layne Christensen
Company 2006 Equity Incentive Plan, as set forth in this instrument and as
hereafter amended from time to time.
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Plan Year
means each 12-month period
beginning January 1 and ending the following December 31, except that for the
first year of the Plan it shall begin on the Original Effective Date and extend
to December 31 of that year.
Restricted Stock
means Stock granted under Section
8 that is subject those restrictions set forth therein and the Award Agreement.
Restricted Stock Unit
means an Award granted under
Section 8 evidencing the Holder's right to receive a Share (or, at the
Committee's discretion, a cash payment equal to the Fair Market Value of a
Share) at some future date and that is subject those restrictions set forth
therein and the Award Agreement.
Rule
16b-3
means Rule 16b-3
promulgated under the 1934 Act, and any future regulation amending,
supplementing, or superseding such regulation.
SAR
or
Stock Appreciation Right
means an Award, granted either alone or in connection with an Option, that is
designated as a SAR pursuant to Section 7.
SAR
Holder
shall have the meaning as
set forth in Section 7.2.
Section 16
Person
means a Person who is
subject to obligations under Section 16 of the 1934 Act with respect to
transactions involving equity securities of the Company.
Service Provider
means an Eligible Employee or a
non-employee director of the Company. Solely for purposes of Substitute Awards,
the term Service Provider includes any current or former employee or
non-employee director of an Acquired Entity (as defined in the definition of
Substitute Awards) who holds Acquired Entity Awards (as defined in the
definition of Substitute Awards) immediately prior to the Acquisition Date (as
defined in the definition of Substitute Awards).
Share
means a share of Stock.
Stock
means authorized and issued or unissued common
stock of the Company, at such par value as may be established from time to time.
Subsidiary
means (i) in
the case of an Incentive Stock Option a subsidiary corporation, whether now or
hereafter existing, as defined in section 424(f) of the Code, and (ii) in the
case of any other type of Award, in addition to a subsidiary corporation as
defined in clause (i), a limited liability company, partnership or other entity
in which the Company controls fifty percent (50%) or more of the voting power or
equity interests.
Substitute
Award
means an Award granted
under the Plan in substitution for stock or stock based awards ("Acquired Entity
Awards") held by current and former employees or former non-employee directors
of another corporation or entity who become Service Providers as the result of a
merger or consolidation of the employing corporation or other entity (the
"Acquired Entity") with the Company, a Subsidiary or an Affiliate, or the
acquisition by the Company, a Subsidiary or an Affiliate, of property or stock
of, or other ownership interest in, the Acquired Entity immediately prior to
such merger, consolidation or acquisition ("Acquisition Date") as agreed to by
the parties to such corporate transaction and as may be set forth in the
definitive purchase agreement. The limitations of Sections 4.1 and 5.5 on the
number of Shares reserved or available for grants, and the limitations under
Sections 6.2 and 7.1 with respect to the Option Exercise Prices and SAR exercise
prices, shall not apply to Substitute Awards. Any issuance of a Substitute Award
which relates to an Option or a SAR shall be completed in conformity with the
rules under Code section 409A relating to the substitutions and assumptions of
stock rights by reason of a corporate transaction.
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7
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Vested Option
means any Option, or portion thereof, which
is exercisable by the Holder. Vested Options remain exercisable only for
that period of time as provided for under this Plan and any applicable
Option Award Agreement. Once a Vested Option is no longer exercisable
after otherwise having been exercisable, the Option shall become null and
void.
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2.2
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General Interpretive Principles.
(i) Words in the singular
shall include the plural and vice versa, and words of one gender shall
include the other gender, in each case, as the context requires; (ii) the
terms "hereof," "herein," and "herewith" and words of similar import
shall, unless otherwise stated, be construed to refer to this Plan and not
to any particular provision of this Plan, and references to Sections are
references to the Sections of this Plan unless otherwise specified; (iii)
the word "including" and words of similar import when used in this Plan
shall mean "including, without limitation," unless otherwise specified;
and (iv) any reference to any U.S. federal, state, or local act, statute
or law shall be deemed to also refer to all amendments or successor
provisions thereto, as well as all rules and regulations promulgated under
such act, statute or law, unless the context otherwise
requires.
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SECTION 3
PLAN ADMINISTRATION
3.1
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Composition of Committee.
The Plan shall be administered by the Committee. To the extent the
Board considers it desirable for transactions relating to Awards to be
eligible to qualify for an exemption under Rule 16b-3, the Committee will
consist of two or more directors of the Company, all of whom qualify as
"non-employee directors" within the meaning of Rule 16b-3. To the extent
the Board considers it desirable for compensation delivered pursuant to
Awards to be eligible to qualify for an exemption from the limit on tax
deductibility of compensation under section 162(m) of the Code, the
Committee shall consist of two or more directors of the Company, all of
whom shall qualify as "outside directors" within the meaning of Code
section 162(m).
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3.2
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Authority of Committee
. Subject to the terms of the Plan and applicable law, and in
addition to other express powers and authorizations conferred on the
Committee by the Plan, the Committee shall have full power and authority
to:
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(a)
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select the Service
Providers to whom Awards may from time to time be granted
hereunder;
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(b)
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determine the type or
types of Awards to be granted to eligible Service Providers;
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(c)
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determine the number
of Shares to be covered by, or with respect to which payments, rights, or
other matters are to be calculated in connection with,
Awards;
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(d)
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determine the terms
and conditions of any Award;
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(e)
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determine whether,
and to what extent, and under what circumstances Awards may be settled or
exercised in cash, Shares, other securities, other Awards or other
property;
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(f)
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determine whether,
and to what extent, and under what circumstance Awards may be canceled,
forfeited, or suspended and the method or methods by which Awards may be
settled, exercised, canceled, forfeited, or suspended;
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(g)
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correct any defect,
supply an omission, reconcile any inconsistency and otherwise interpret
and administer the Plan and any instrument or Award Agreement relating to
the Plan or any Award hereunder;
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(h)
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to grant Awards in
replacement of Awards previously granted under this Plan or any other
compensation plan of the Company, provided that any such replacement grant
that would be considered a repricing shall be subject to stockholder
approval;
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(i)
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cause the forfeiture
of any Award or recover any Shares, cash or other property attributable to
an Award for violations of any Company ethics policy or pursuant to any
Company compensation clawback policy, in each case, in effect on the
Effective Date or as adopted or amended thereafter;
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(j)
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with the consent of
the Holder, to amend any Award Agreement at any time, including waiving
any restriction or vesting or exercise condition applicable to any Award
or any group of Awards for any reason and at any time; provided that the
consent of the Holder shall not be required for any amendment (i) that, in
the Committee's determination, does not materially adversely affect the
rights of the Holder, or (ii) which is necessary or advisable (as
determined by the Committee) to carry out the purpose of the Award as a
result of any new applicable law or change in an existing applicable law,
or (iii) to the extent the Award Agreement specifically permits amendment
without consent;
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(k)
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subject to Section
5.7, to determine whether, to what extent, and under what circumstances an
Award may be vested, paid, settled, canceled, forfeited or surrendered,
or, in connection with a Participant's death, disability, retirement,
Change in Control, termination of employment following a Change in Control
or other special circumstances determined by the Committee, or, to extend
the period subsequent to the termination of employment within which an
Award may be exercised;
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(l)
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modify and
amend the Plan, establish, amend, suspend, or waive such rules,
regulations and procedures of the Plan, and appoint such agents as it
shall deem appropriate for the proper administration of the Plan;
and
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(m)
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make any other
determination and take any other action that the Committee deems necessary
or desirable for the administration of the Plan.
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3.3
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Committee
Delegation.
The Committee
may delegate to any member of the Board or committee of Board members such
of its powers as it deems appropriate, including the power to
sub-delegate, except that, pursuant to such delegation or sub-delegation,
only a member of the Board (or a committee thereof) may grant Awards from
time to time to specified categories of Service Providers in amounts and
on terms to be specified by the Board or the Committee; provided that no
such grants shall be made other than by the Board or the Committee to
individuals who are then Section 16 Persons or other than by the Committee
to individuals who are then or are deemed likely to become a "covered
employee" within the meaning of Code section 162(m). A majority of the
members of the Committee may determine its actions and fix the time and
place of its meetings.
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3.4
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Determination
Under the Plan
. Unless
otherwise expressly provided in the Plan, all designations,
determinations, adjustments, interpretations, and other decisions under or
with respect to the Plan, any Award or Award Agreement shall be within the
sole discretion of the Committee, may be made at any time and shall be
final, conclusive, and binding upon all persons, including the Company,
any Participant, any Holder, and any stockholder. No member of the
Committee shall be liable for any action, determination or interpretation
made in good faith, and all members of the Committee shall, in addition to
their rights as directors, be fully protected by the Company with respect
to any such action, determination or interpretation
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SECTION 4
STOCK SUBJECT TO THE PLAN
4.1
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Number of Shares
. Subject to adjustment as provided in
Section 4.3 and subject to the maximum number of Shares that may be
granted to an individual in a calendar year as set forth in Section 5.5,
the aggregate number of Shares authorized for issuance under the Plan in
accordance with the provisions of the Plan shall be FOUR MILLION
ONE HUNDRED THIRTY FOUR THOUSAND FIVE HUNDRED
(4,134,500), subject to such restrictions or other provisions as the
Committee may from time to time deem necessary (the "Maximum Share
Limit"). Any Shares required to satisfy Substitute Awards shall not count
against the Maximum Share Limit. Any Shares issued hereunder may consist,
in whole or in part, of authorized and unissued shares or treasury shares.
The Shares may be divided among the various Plan components as the
Committee shall determine; provided, however, the maximum number of Shares
that may be issued pursuant to Incentive Stock Options shall be the sum of
the Maximum Share Limit and any Incentive Stock Options issued as
Substitute Awards. Shares that are subject to an underlying Award and
Shares that are issued pursuant to the exercise of an Award shall be
applied to reduce the maximum number of Shares remaining available for use
under the Plan. The Company shall at all times during the term of the Plan
and while any Awards are outstanding retain as authorized and
unissued Stock, or as treasury Stock, at least the number of Shares from
time to time required under the provisions of the Plan, or otherwise
assure itself of its ability to perform its obligations
hereunder.
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10
4.2
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Unused
and Forfeited Stock
. Any
Shares that are subject to an Award under this Plan that are not used
because the terms and conditions of the Award are not met, including any
Shares that are subject to an Award that expires or is terminated for any
reason, shall again be available for grant under the Plan. Shares subject
to an Award under this Plan shall not again be made available for issuance
or delivery under this Plan if such shares are (a) tendered in payment of
an Option, (b) delivered or withheld by the Company to satisfy any tax
withholding obligation, (c) covered by a stock-settled SAR or other Award
that were not issued upon the settlement of the Award or (d) are
repurchased on the open market using stock option exercise
proceeds.
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4.3
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Adjustments in Authorized Shares.
If, without the receipt of consideration
therefore by the Company, the Company shall at any time increase or
decrease the number of its outstanding Shares or change in any way the
rights and privileges of such Shares such as, but not limited to, the
payment of a stock dividend or any other distribution upon such Shares
payable in Stock, or through a stock split, spin-off, extraordinary cash
dividend, subdivision, consolidation, combination, reclassification or
recapitalization involving the Stock, or any similar corporate event or
transaction, such that an adjustment is necessary in order to prevent
dilution or enlargement of the benefits or potential benefits intended to
be made available under the Plan then in relation to the Stock that is
affected by one or more of the above events, (i) the numbers, rights,
privileges and kinds of Shares that may be issued under this Plan or under
particular forms of Awards, (ii) the number and kind of Shares subject to
outstanding Awards, (iii) the Option Exercise Price or SAR exercise price
applicable to outstanding Awards, and (iv) the annual individual
limitation set forth in Section 5.5, shall be increased, decreased or
changed in like manner as if they had been issued and outstanding, fully
paid and non assessable at the time of such occurrence.
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4.4
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General
Adjustment Rules
.
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(a)
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If any adjustment or
substitution provided for in this Section 4 shall result in the creation
of a fractional Share under any Award, such fractional Share shall be
rounded to the nearest whole Share and fractional Shares shall not be
issued.
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(b)
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In the case of any
such substitution or adjustment affecting an Option or a SAR (including a
Nonqualified Stock Option) such substitution or adjustments shall be made
in a manner that is in accordance with the substitution and assumption
rules set forth in Treasury Regulations 1.424-1 and the applicable
guidance relating to Code section 409A.
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11
SECTION 5
PARTICIPATION
5.1
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Basis of
Grant
. Participants in the Plan
shall be those Service Providers, who, in the judgment of the Committee,
have performed, are performing, or during the term of their
incentive arrangement will perform, important services in the
management, operation and development of the Company, and significantly
contribute, or are expected to significantly contribute, to the
achievement of long-term corporate economic objectives.
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5.2
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Types of Grants;
Limits.
Participants may be
granted from time to time one or more Awards; provided, however, that the
grant of each such Award shall be separately approved by the Committee or
its designee, and receipt of one such Award shall not result in the
automatic receipt of any other Award. Written or electronic notice shall
be given to such Participant, specifying the terms, conditions, right and
duties related to such Award. Under no circumstance shall Incentive Stock
Options be granted to (i) non-employee directors or (ii) any person not
permitted to receive Incentive Stock Options under the Code.
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5.3
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Award
Agreements
. Each
Participant shall enter into an Award Agreement(s) with the Company, in
such form as the Committee shall determine and which is consistent with
the provisions of the Plan, specifying the applicable Award terms,
conditions, rights and duties. Unless otherwise explicitly stated in the
Award Agreement, Awards shall be deemed to be granted as of the date
specified in the grant resolution of the Committee, which date shall be
the date of any related agreement(s) with the Participant. Unless
explicitly provided for in a particular Award Agreement that the terms of
the Plan are being superseded, in the event of any inconsistency between
the provisions of the Plan and any such Award Agreement(s) entered into
hereunder, the provisions of the Plan shall govern.
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5.4
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Restrictive
Covenants
. The Committee
may, in its sole and absolute discretion, place certain restrictive
covenants in an Award Agreement requiring the Participant to agree to
refrain from certain actions. Such restrictive covenants, if contained in
the Award Agreement, will be binding on the Participant.
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5.5
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Maximum Annual
Award.
Subject to any
adjustments required to be made pursuant to Section 4.3, the maximum
number of Shares with respect to which an Award or Awards (including
Options and SARs) may be granted to any Participant in any one taxable
year of the Company (the Maximum Annual Participant Award) shall not
exceed 600,000 Shares (increased, proportionately, in the event of any
stock split or stock dividend with respect to the Shares).
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5.6
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No Dividends or
Dividend Equivalents on Unvested Awards
. Notwithstanding any other provision in
this Plan to the contrary, in no event may cash or stock dividends or
dividend equivalents relating to an unvested portion of an Award be paid
to a Holder before that portion of the Award becomes vested.
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5.7
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Minimum Vesting /
Exercise Requirements
.
Except for Substitute Awards, or following the death, disability or
retirement of a Participant, Awards granted under the Plan shall in all
cases have a minimum vesting period of not less than twelve (12) months
from the Award's date of grant, and such minimum vesting requirement shall
be applicable to grants to employees and non-employee directors. The
one-year minimum vesting requirement shall not apply to the extent the
terms of an Award allow for accelerated vesting following a
Change in Control, and the Committee may elect to exempt up to 5% of the
Maximum Share Limit from this minimum vesting
requirement.
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12
5.8
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Clawback
Policy
. Notwithstanding any
other provision of this Plan, any Award may be subject to recovery under
any law, governmental regulation or stock exchange listing requirement,
including certain provisions of the Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010 or certain recovery provisions of the
Sarbanes-Oxley Act of 2002, or any other compensation clawback policy that
is adopted by the Committee and that will require the Company to be able
to claw back compensation paid to an executive under certain
circumstances. Any Participant or beneficiary receiving an Award
acknowledges that the Award may be clawed back by the Company in
accordance with any policies and procedures adopted by the Committee in
order to comply with any law, governmental regulation or stock exchange
listing requirement or as set forth in an Award Agreement.
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5.9
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Non-Employee
Director Sublimit
. No
non-employee director may be granted Awards of Options, SARs, Restricted
Shares, Restricted Share Units, Bonus Shares, Performance Shares, or
Performance Units (or any other Award which is denominated in Shares) in
any one (1) calendar year with respect to a number of Shares that exceeds
a number equal to the quotient of $250,000 divided by the grant date fair
value of the awards (determined under applicable accounting principles),
rounded down to the nearest whole share; provided, however, for purposes
of the foregoing limitation, (a) any Shares deferred pursuant to a
nonqualified deferred compensation arrangement shall count against the
limit only during the calendar year in which such Award is initially made
and not in the calendar year in which the deferred Shares are ultimately
issued, and (b) no Shares under any Award or portion thereof which is made
pursuant to an election made by a non-employee director to receive his or
her non-employee director cash compensation in the form of an Award under
this Plan rather than in cash shall count against the limit in this
Section 5.10.
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SECTION 6
STOCK
OPTIONS
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6.1
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Grant of Options.
A Participant may be granted one or more
Options. The Committee in its sole discretion shall designate whether an
Option is an Incentive Stock Option or a Nonqualified Stock Option. The
Committee may grant both an Incentive Stock Option and a Nonqualified
Stock Option to the same Participant at the same time or at different
times. Incentive Stock Options and Nonqualified Stock Options, whether
granted at the same or different times, shall be deemed to have been
awarded in separate grants, shall be clearly identified, and in no event
shall the exercise of one Option affect the right to exercise any other
Option or affect the number of Shares for which any other Option may be
exercised.
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6.2
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Option Agreements
. Each Option granted under the Plan shall
be evidenced by an Option Award Agreement which shall be entered into by
the Company and the Participant to whom the Option is granted (the Option
Holder), and which shall contain, or be subject
to, the following terms and conditions, as
well as such other terms and conditions not inconsistent therewith, as the
Committee may consider appropriate in each case.
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(a)
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Number
of Shares
. Each Option
Award Agreement shall state that it covers a specified number of Shares,
as determined by the Committee. To the extent that the aggregate Fair
Market Value of Shares with respect to which Options designated as
Incentive Stock Options are exercisable for the first time by any Option
Holder during any calendar year exceeds $100,000 or, if different, the
maximum limitation in effect at the time of grant under section 422(d) of
the Code, or any successor provision, such Options in excess of such limit
shall be treated as Nonqualified Stock Options. The foregoing shall be
applied by taking Options into account in the order in which they were
granted. For the purposes of the foregoing, the Fair Market Value of any
Share shall be determined as of the time the Option with respect to such
Share is granted. In the event the foregoing results in a portion of an
Option designated as an Incentive Stock Option exceeding the $100,000
limitation, only such excess shall be treated as a Nonqualified Stock
Option.
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(b)
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Price
. Each Option
Award Agreement shall state the Option Exercise Price at which each Share
covered by an Option may be purchased. Such Option Exercise Price shall be
determined in each case by the Committee, but in no event other than with
respect to the issuance of a Substitute Award shall the Option Exercise
Price for each Share covered by an Option be less than the Fair Market
Value of the Stock on the Options Grant Date, as determined by the
Committee; provided, however, that the Option Exercise Price for each
Share covered by an Incentive Stock Option granted to an Eligible Employee
who then owns stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or any parent or Subsidiary
corporation of the Company must be at least 110% of the Fair Market Value
of the Stock subject to the Incentive Stock Option on the Options Grant
Date.
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(c)
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Duration
of Options; Automatic Exercise
.
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(i)
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Each Option Award
Agreement shall state the period of time, determined by the Committee,
within which the Option may be exercised by the Option Holder (the Option
Period). The Option Period must expire, in all cases, not more than ten
years from the Options Grant Date; provided, however, that the Option
Period of an Incentive Stock Option granted to an Eligible Employee who
then owns Stock possessing more than 10% of the total combined voting
power of all classes of Stock of the Company must expire not more than
five years from the Options Grant Date. Each Option Award Agreement shall
also state the periods of time, if any, as determined by the Committee,
when incremental portions of each Option shall become exercisable. If any
Option or portion thereof is not exercised during its Option Period, such
unexercised portion shall be deemed to have been forfeited and have no
further force or effect.
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(ii)
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With respect to any
Nonqualified Stock Option granted after the Original Effective Date or any
Incentive Stock Option granted after June 6, 2014 and to the extent that
such Option has not otherwise been exercised, cancelled, terminated or
forfeited, if on the last day of the Option Period, the Fair Market Value
exceeds the Option Exercise Price, such Option shall be deemed to have
been exercised by the Participant on such last day of the Option Period
through either a "cashless exercise" or "net exercise" procedure and the
Company shall issue the appropriate number of Shares
therefor.
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(d)
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Termination of Service, Death, Disability, etc.
Each Option Agreement shall state the period
of time, if any, determined by the Committee, within which the Vested
Option may be exercised after an Option Holder ceases to be a Service
Provider on account of the Participants death, Disability, voluntary
resignation, removal from the Board or the Company having terminated such
Option Holders employment with or without Cause. If, within the period of
time specified in the Option Award Agreement following the Option Holder's
termination of employment, an Option Holder is prohibited by law or a
Company's insider trading policy from exercising any Nonqualified Stock
Option, the period of time during which such Option may be exercised will
automatically be extended until the 30
th
day following the date the prohibition is
lifted. Notwithstanding the immediately preceding sentence, in no event
shall the Option exercise period be extended beyond the tenth anniversary
of the Option's Grant Date.
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(e)
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Transferability
.
Except to the extent permitted by the Committee pursuant to Section 11.3,
Options shall not be transferable by the Option Holder except by will or
pursuant to the laws of descent and distribution. Each Vested Option shall
be exercisable during the Option Holders lifetime only by him or her, or
in the event of Disability or incapacity, by his or her guardian or legal
representative. Shares issuable pursuant to any Option shall be delivered
only to or for the account of the Option Holder, or in the event of
Disability or incapacity, to his or her guardian or legal
representative.
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(f)
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Exercise, Payments, etc
.
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(i)
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Unless otherwise
provided in the Option Award Agreement, each Vested Option may be
exercised by delivery to the Corporate Secretary or Chief Financial
Officer of the Company or their designees a written or electronic notice
specifying the number of Shares with respect to which such Option is
exercised and payment of the Option Exercise Price. Such notice shall be
in a form satisfactory to the Committee or its designee and shall specify
the particular Vested Option that is being exercised and the number of
Shares with respect to which the Vested Option is being exercised. The
exercise of the Vested Option shall be deemed effective upon receipt of
such notice by the Corporate Secretary or Chief Financial Officer of the
Company or their designees and payment to the Company. The purchase of
such Stock shall take place at the principal offices of the Company
upon delivery of such notice, at which time
the purchase price of the Stock shall be paid in full by any of the
methods or any combination of the methods set forth in (ii) below.
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(ii)
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The Option Exercise
Price may be paid by any of the following methods:
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A.
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Cash or certified bank check;
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B.
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By delivery to the Company of Shares then
owned by the Holder, the Fair Market Value of which equals the purchase
price of the Stock purchased pursuant to the Vested Option, properly
endorsed for transfer to the Company; provided, however, that Shares used
for this purpose must have been held by the Holder for such minimum period
of time as may be established from time to time by the Committee; and
provided further that the Fair Market Value of any Shares delivered in
payment of the purchase price upon exercise of the Options shall be the
Fair Market Value as of the exercise date, which shall be the date of
delivery of the certificates for the Stock used as payment of the Option
Exercise Price.
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In lieu of actually surrendering to the
Company the stock certificates representing the number of Shares then
owned by the Holder, the Committee may, in its discretion permit the
Holder to submit to the Company a statement affirming ownership by the
Holder of such number of Shares and request that such Shares, although not
actually surrendered, be deemed to have been surrendered by the Holder as
payment of the exercise price.
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C.
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For any Holder other than an Executive
Officer or except as otherwise prohibited by the Committee, by payment
through a broker in accordance with procedures permitted by Regulation T
of the Federal Reserve Board.
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D.
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For any Nonqualified Stock Option, by a "net
exercise" arrangement pursuant to which the Company will not require a
payment of the Option Exercise Price but will reduce the number of Shares
of Stock upon the exercise by the largest number of whole shares that has
a Fair Market Value on the date of exercise that does not exceed the
aggregate Option Exercise Price.
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E.
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Any combination of the consideration
provided in the foregoing subsections (A), (B), (C) and (D).
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(iii)
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The Company shall not
guarantee a third-party loan obtained by a Holder to pay part or the
entire Option Exercise Price of the Shares.
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(g)
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Date of
Grant
. Unless otherwise
specifically specified in the Option Award Agreement, an option shall be
considered as having been granted on the date specified in the grant
resolution of the Committee.
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(h)
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Withholding
.
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(A)
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Nonqualified Stock Options
. Upon any exercise of a Nonqualified Stock
Option, the Option Holder shall make appropriate arrangements with the
Company to provide for the minimum amount of additional withholding
required by applicable federal and state income tax and payroll laws,
including payment of such taxes through delivery of Stock or by
withholding Stock to be issued under the Option, as provided in Section 15
hereof.
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(B)
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Incentive Stock Options.
In the event that an Option Holder makes a
disposition (as defined in Section 424(c) of the Code) of any Stock
acquired pursuant to the exercise of an Incentive Stock Option prior to
the later of (i) the expiration of two years from the date on which the
Incentive Stock Option was granted or (ii) the expiration of one year from
the date on which the Option was exercised, the Participant shall send
written or electronic notice to the Company at its principal office
(Attention: Corporate Secretary) of the date of such disposition, the
number of shares disposed of, the amount of proceeds received from such
disposition, and any other information relating to such disposition as the
Company may reasonably request. The Option Holder shall, in the event of
such a disposition, make appropriate arrangements with the Company to
provide for the amount of additional withholding, if any, required by
applicable Federal and state income tax laws.
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(i)
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Adjustment of
Options
. Subject to the
limitations set forth below and those contained in Sections 6 and 14, the
Committee may make any adjustment in the Option Exercise Price, the number
of Shares subject to, or the terms of, an outstanding Option and a
subsequent granting of an Option by amendment or by substitution of an
outstanding Option. Such amendment, substitution, or re-grant may result
in terms and conditions (including Option Exercise Price, number of Shares
covered, vesting schedule or exercise period) that differ from the terms
and conditions of the original Option; provided, however, except as
permitted under Section 10, the Committee may not, without stockholder
approval (i) amend an Option to reduce its Option Exercise Price, (ii)
cancel an Option and regrant an Option with a lower Option Exercise Price
than the original Option Exercise Price of the cancelled Option, (iii)
cancel an Option in exchange for cash or another Award or (iv) take any
other action (whether in the form of an amendment, cancellation or
replacement grant) that has the effect of "repricing" an Option, as
defined under applicable NASDAQ rules or the rules of the established
stock exchange or quotation system on which the Company Stock is then
listed or traded if such Exchange's or quotation system's rules define
what constitutes a repricing. Other than with respect to a modification
that a reasonable
person would not
find to be a material adverse change in an Option Holder's rights under an
Option, the Committee also may not adversely affect the rights of any
Option Holder to previously granted Options without the consent of such
Option Holder. If such action is affected by the amendment, the effective
date of such amendment shall be the date of the original grant. Any
adjustment, modification, extension or renewal of an Option shall be
effected such that the Option is either exempt from, or is compliant with,
Code section 409A.
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17
6.3
|
Stockholder Privileges
. No Holder shall have any rights as a
stockholder with respect to any Shares covered by an Option until the
Holder becomes the holder of record of such Stock, and no adjustments
shall be made for dividends or other distributions or other rights as to
which there is a record date preceding the date such Holder becomes the
holder of record of such Stock, except as provided in Section
4.
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SECTION 7
STOCK APPRECIATION RIGHTS
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7.1
|
Grant of
SARs
. Subject to the terms
and conditions of this Plan, a SAR may be granted to a Participant at any
time and from time to time as shall be determined by the Committee in its
sole discretion.
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(a)
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Number of Shares
. The Committee shall have complete discretion to
determine the number of SARs granted to any Participant, subject to the
limitations imposed in this Plan and by applicable
law.
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(b)
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Exercise Price
and Other Terms
. Except with
respect to a Substitute Award, all SARs shall be granted with an exercise
price no less than the Fair Market Value of the underlying Shares on the
SARs Date of Grant. The Committee, subject to the provisions of this
Plan, shall have complete discretion to determine the terms and conditions
of SARs granted under this Plan.
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(c)
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Duration of
SARs
. Each SAR Award Agreement
shall state the period of time, determined by the Committee (not to exceed
10 years), within which the SARs may be exercised by the Holder (the SAR
Period).
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7.2
|
SAR Award
Agreement
. Each SAR granted
under the Plan shall be evidenced by a SAR Award Agreement which shall be
entered into by the Company and the Participant to whom the SAR is granted
(the SAR Holder), and which shall specify the exercise price per share,
the terms of the SAR, the conditions of exercise, and such other terms and
conditions as the Committee in its sole discretion shall
determine.
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7.3
|
Exercise of
SARs
. SARs shall be
exercisable on such terms and conditions as the Committee in its sole
discretion shall determine.
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7.4
|
Expiration of
SARs
. A SAR granted under
this Plan shall expire on the earlier of (i) the tenth anniversary of the
SARs Date of Grant or (ii) the date set forth in the SAR Award Agreement,
which date shall be determined by the Committee in its sole
discretion. Unless otherwise
specifically provided for in the SAR Award Agreement, a SAR granted under this Plan shall terminate according to
the same rules under which a Nonqualified Stock Option would terminate in
the event of a SAR Holders termination of employment, death or Disability
as provided for in the SAR Award Agreement.
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18
7.5
|
Adjustment of SARs.
Subject to the limitations
set forth below and those contained in Sections 7 and 14, the Committee
may make any adjustment in the SAR exercise price, the number of Shares
subject to, or the terms of, an outstanding SAR and a subsequent granting
of an SAR by amendment or by substitution of an outstanding SAR. Such
amendment, substitution, or re-grant may result in terms and conditions
(including SAR exercise price, number of Shares covered, vesting schedule
or exercise period) that differ from the terms and conditions of the
original SAR; provided, however, except as permitted under Section 10, the
Committee may not, without stockholder approval (i) amend a SAR to reduce
its exercise price, (ii) cancel a SAR and regrant a SAR with a lower
exercise price than the original SAR exercise price of the cancelled SAR,
(iii) cancel a SAR in exchange for cash or another Award or (iv) take any
other action (whether in the form of an amendment, cancellation or
replacement grant) that has the effect of "repricing" a SAR, as defined
under applicable NASDAQ rules or the rules of the established stock
exchange or quotation system on which the Company Stock is then listed or
traded. The Committee also may not adversely affect the rights of any SAR
Holder to previously granted SARs without the consent of such SAR Holder.
If such action is affected by the amendment, the effective date of such
amendment shall be the date of the original grant. Any adjustment,
modification, extension or renewal of a SAR shall be effected such that
the SAR is either exempt from, or is compliant with, Code section
409A.
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7.6
|
Payment of SAR
Amount; Automatic Exercise
.
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(a)
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Upon exercise of a SAR, a Holder shall be
entitled to receive payment from the Company in an amount determined by
multiplying (i) the positive difference between the Fair Market Value of a
Share on the date of exercise over the exercise price per Share by (ii)
the number of Shares with respect to which the SAR is exercised. At the
Committee's discretion, the payment upon a SAR exercise may be in whole
Shares of equivalent value, cash, or a combination of whole Shares and
cash. Fractional Shares shall be rounded down to the nearest whole
Share.
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(b)
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With respect to any SAR and to the extent
that such SAR has not otherwise been exercised, cancelled, terminated or
forfeited, if on the last day of the SAR Period, the Fair Market Value
exceeds the SAR exercise price, such SAR shall be deemed to have been
exercised by the Participant on such last day of the SAR Period and the
Company shall deliver the appropriate number of Shares or amount of cash
therefor.
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7.7
|
Stockholder
Privileges
. No Holder shall
have any rights as a stockholder with respect to any Shares covered by a
SAR until the Holder becomes the holder of record of such Stock, and no
adjustments shall be made for dividends or other distributions or other
rights as to which there is a record
date preceding the date such Holder becomes the holder of record of such
Stock, except as provided in Section 4.
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19
SECTION 8
AWARDS OF RESTRICTED STOCK AND RESTRICTED STOCK
UNITS
8.1
|
Restricted Stock
Awards Granted by Committee
. Coincident with or following designation for participation in the
Plan and subject to the terms and provisions of the Plan, the Committee,
at any time and from time to time, may grant Restricted Stock to any
Service Provider in such amounts as the Committee shall
determine.
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8.2
|
Restricted Stock
Unit Awards Granted by Committee
. Coincident with or following designation for participation in the
Plan and subject to the terms and provisions of the Plan, The Committee
may grant a Service Provider Restricted Stock Units, in connection with or
separate from a grant of Restricted Stock. Upon the vesting of Restricted
Stock Units, the Holder shall be entitled to receive the full value of the
Restricted Stock Units payable in Shares or, if determined by the
Committee, cash.
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8.3
|
Restrictions
. A
Holders right to retain Shares of Restricted Stock or be paid with
respect to Restricted Stock Units shall be subject to such restrictions,
including him or her continuing to perform as a Service Provider for a
restriction period specified by the Committee, or the attainment of
specified performance goals and objectives, as may be established by the
Committee with respect to such Award. The Committee may in its sole
discretion require different periods of service or different performance
goals and objectives with respect to (i) different Holders, (ii) different
Restricted Stock or Restricted Stock Unit Awards, or (iii) separate,
designated portions of the Shares constituting a Restricted Stock Award.
Any grant of Restricted Stock or Restricted Stock Units shall contain
terms such that the Award is either exempt from Code section 409A or
complies with such section.
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8.4
|
Privileges of a
Stockholder, Transferability
. Unless otherwise provided in the Award Agreement, a Participant
shall have all voting, dividend, liquidation and other rights with respect
to Shares of Restricted Stock, provided however that any dividends paid on
Shares of Restricted Stock prior to such Shares becoming vested shall be
held in escrow by the Company and subject to the same restrictions on
transferability and forfeitability as the underlying Shares of Restricted
Stock. Any voting, dividend, liquidation or other rights shall accrue to
the benefit of a Holder only with respect to Shares of Restricted Stock
held by, or for the benefit of, the Holder on the record date of any such
dividend or voting date. A Participants right to sell, encumber or
otherwise transfer such Restricted Stock shall, in addition to the
restrictions otherwise provided for in the Award Agreement, be subject to
the limitations of Section 11.2 hereof. The Committee may determine that a
Holder of Restricted Stock Units is entitled to receive dividend
equivalent payments on such units; provided, however, in no event shall
any dividend equivalents relating to Restricted Stock Units subject to one
or more performance-based vesting criteria be paid unless and until the
underlying Restricted Stock Units are earned. If the Committee determines
that Restricted Stock Units shall receive dividend equivalent
payments, such feature will be specified in
the applicable Award Agreement. Restricted Stock Units shall not have any
voting rights.
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20
8.5
|
Enforcement of
Restrictions.
The Committee
may in its sole discretion require one or more of the following methods of
enforcing the restrictions referred to in Section 8.2 and
8.3:
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(a)
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placing a legend on the stock certificates,
or the Restricted Stock Unit Award Agreement, as applicable, referring to
restrictions;
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(b)
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|
requiring the Holder to keep the stock
certificates, duly endorsed, in the custody of the Company while the
restrictions remain in effect;
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(c)
|
|
requiring that the stock certificates, duly
endorsed, be held in the custody of a third party nominee selected by the
Company who will hold such Shares of Restricted Stock on behalf of the
Holder while the restrictions remain in effect; or
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(d)
|
|
inserting a provision into the Restricted
Stock Award Agreement prohibiting assignment of such Award Agreement until
the terms and conditions or restrictions contained therein have been
satisfied or released, as applicable.
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8.6
|
Termination of
Service, Death, Disability, etc..
Except as otherwise provided in an Award Agreement, in the event of
the death or Disability of a Participant, all service period and other
restrictions applicable to Restricted Stock Awards then held by him or her
shall lapse, and such Awards shall become fully nonforfeitable. Subject to
Section 10 and except as otherwise provided in an Award Agreement, in the
event a Participant ceases to be a Service Provider for any other reason,
any Restricted Stock Awards as to which the service period or other
vesting conditions for have not been satisfied shall be
forfeited.
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SECTION 9
BONUS SHARES AND PERFORMANCE AWARDS; SECTION
162(M) PROVISIONS
9.1
|
Awards Granted by
Committee
. Coincident with
or following designation for participation in the Plan, a Participant may
be granted Bonus Shares, Performance Shares, Performance Units or any
other Performance Award.
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9.2
|
Bonus
Shares
. Subject to the
terms of the Plan, the Committee may grant Bonus Shares to any
Participant, in such amount, upon such terms and at any time and from time
to time as shall be determined by the Committee.
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9.3
|
Communication of
Award
. Written or
electronic notice of the maximum amount of a Holders Award and the
Performance Period determined by Committee shall be given to a Participant
as soon as practicable after approval of the Award by the
Committee.
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9.4
|
Terms of
Performance Awards
. The
Committee shall determine (i) whether the Award will be in the form of a
Performance Share, Performance Unit or any other type of Performance
Award, and (ii) whether, if a payment is due with respect to an Award
such payment shall be made
in cash, Stock or some combination. Except as provided in Section 10,
Performance Awards will be issued or granted, or become vested or payable,
only after the end of the relevant Performance Period. The Committee shall
establish maximum and minimum performance targets to be achieved during
the applicable Performance Period. Each grant of a Performance Share,
Performance Unit or other Performance Award shall be subject to additional
terms and conditions not inconsistent with the provisions of the Plan. The
performance goals to be achieved for each Performance Period and the
amount of the Award to be distributed upon satisfaction of those
performance goals shall be conclusively determined by the
Committee.
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21
9.5
|
Performance
Goals
. If an Award is
subject to this Section 9, then the lapsing of restrictions thereon, or
the vesting thereof, and the distribution of cash, Shares or other
property pursuant thereto, as applicable, shall be subject to the
achievement of one or more objective performance goals established by the
Committee, which shall be based on the attainment of one or any
combination of the following metrics, and which may be established on an
absolute or relative basis for the Company as a whole or any of its
subsidiaries, operating divisions or other operating units:
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(a)
|
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Earnings measures
(either in the aggregate or on a per-Share basis), including earnings per
share, earnings before interest, earnings before interest and taxes,
earnings before interest, taxes and depreciation or earnings before
interest, taxes, depreciation and amortization and in the case of any of
the foregoing, adjusted to exclude any one or more of the
following:
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(i)
|
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stock-based compensation
expense;
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(ii)
|
|
income from discontinued
operations;
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(iii)
|
|
gain on cancellation of debt;
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(iv)
|
|
debt extinguishment and related
costs;
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(v)
|
|
restructuring, separation and/or integration
charges and costs;
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(vi)
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|
reorganization and/or recapitalization
charges and costs;
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(vii)
|
|
impairment charges;
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(viii)
|
|
gain or loss related to investments or the
sale of assets;
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(ix)
|
|
sales and use tax settlement;
and
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(x)
|
|
gain on non-monetary
transaction.
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(b)
|
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Operating profit,
operating income or operating margin (either in the aggregate or on a
per-Share basis);
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(c)
|
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Net earnings on
either a LIFO or FIFO basis (either in the aggregate or on a per-Share
basis);
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(d)
|
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Net income or loss
(either in the aggregate or on a per-Share basis);
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(e)
|
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Cash flow provided by
operations (either in the aggregate or on a per-Share basis);
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(f)
|
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Cash flow returns,
including cash flow returns on invested capital (cash flow from operating
activities minus capital expenditures, the difference of which is divided
by the difference between total assets and non-interest bearing current
liabilities);
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(g)
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Ratio of debt to debt
plus equity;
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(h)
|
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Net
borrowing;
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(i)
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|
Credit quality or
debt ratings;
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(j)
|
|
Inventory levels,
inventory turn or shrinkage;
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(k)
|
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Sales;
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(l)
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Revenues;
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(m)
|
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Free cash flow
(either in the aggregate or on a per-Share basis);
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(n)
|
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Reductions in expense
levels, determined either on a Company-wide basis or with respect to any
one or more business units;
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(o)
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Operating and
maintenance cost management and employee productivity;
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(p)
|
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Gross
margin;
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(q)
|
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Return measures
(including return on assets, return on capital, return on equity, return
on investment or return on sales);
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(r)
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Productivity
increases;
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(s)
|
|
Share price
(including attainment of a specified per-Share price during the Incentive
Period; growth measures and total stockholder return or attainment by the
Shares of a specified price for a specified period of time);
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(t)
|
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Growth or rate of
growth of any of the above business criteria;
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(u)
|
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Specified revenue,
market share, market penetration, business development, geographic
business expansion goals, objectively identified project milestones,
production volume levels, cost targets, customer satisfaction, and goals
relating to acquisitions or divestitures; and
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(v)
|
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Accomplishment of
mergers, acquisitions, dispositions, public offerings, or similar
extraordinary business transactions;
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provided that
applicable incentive goals may be applied on a pre- or post-tax basis; and
provided further that the Committee may, when the applicable incentive
goals are established, provide
that the formula for such goals may include or exclude items to measure
specific objectives, such as losses from discontinued operations,
extraordinary gains or losses, the cumulative effect of accounting
changes, acquisitions or divestitures, foreign exchange impacts and any
unusual, nonrecurring gain or loss. As established by the Committee, the
incentive goals may include, without limitation, GAAP and non-GAAP
financial measures.
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23
9.6
|
Determinations and
Adjustments
. When the
Committee determines whether a performance goal has been satisfied for any
Performance Period, the Committee, where the Committee deems appropriate,
may make such determination using calculations which alternatively include
and exclude one, or more than one, unusual or infrequently occurring
events or transactions as determined under U.S. generally accepted
accounting principles, and the Committee may determine whether a
performance goal has been satisfied for any Performance Period taking into
account the alternative which the Committee deems appropriate under the
circumstances. The Committee also may take into account any other unusual
or non-recurring items, including (i) asset write-downs; (ii) litigation
or claim judgments or settlements; and (iii) the charges or costs
associated with restructurings of the Company, discontinued operations,
and the cumulative effects of accounting changes and, further, may take
into account any unusual or non-recurring events affecting the Company,
changes in applicable tax laws or accounting principles or such other
factors as the Committee may determine reasonable and appropriate under
the circumstances (including any factors that could result in the
Company's paying non-deductible compensation to an Employee or
non-employee director). Notwithstanding any provision of the Plan other
than Section 4.3, with respect to any Award that is subject to this
Section 9, the Committee may not adjust upwards the amount payable
pursuant to such Award, nor may it waive the achievement of the applicable
performance goals except in the case of the death or Disability of the
Participant.
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9.7
|
Payment of
Awards
. Following the
conclusion of each Performance Period, the Committee shall determine the
extent to which performance targets have been attained, and the
satisfaction of any other terms and conditions with respect to an Award
relating to such Performance Period. The Committee shall determine what,
if any, payment is due with respect to an Award and whether such payment
shall be made in cash, Stock or some combination. Payment shall be made in
a lump sum, as determined by the Committee, commencing as promptly as
practicable following the end of the applicable Performance Period,
subject to such terms and conditions and in such forms as may be
prescribed by the Committee. All Awards shall be paid no later than March
15
th
of the Plan
Year following the Plan Year in which the Committee determines that a
Participant is entitled to receive the performance award.
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9.8
|
Termination of
Employment
. If a
Participant ceases to be a Service Provider for any reason other than
having been terminated for Cause after the end of a Performance Period yet
before receiving payment as provided for in Section 9.7, the Holder (or
the Holders Beneficiaries) shall be entitled to receive the full amount
payable as soon as practicable after such amount has been determined by
the Committee. Unless otherwise determined by the Committee, if a Holder
ceases to be a Service Provider before the end of a Performance Period by
reason of his or her death or Disability, the Performance Period
for such Holder for the purpose of
determining the amount of the Award payable shall end at the end of the
calendar quarter immediately preceding the date on which such Holder
ceased to be a Service Provider. The amount of an Award payable to a
Holder to whom the preceding sentence is applicable shall be paid at the
end of the Performance Period and shall be that fraction of the Award
computed pursuant to the preceding sentence the numerator of which is the
number of calendar quarters during the Performance Period during all of
which said Holder was a Service Provider and the denominator of which is
the number of full calendar quarters in the Performance Period. In the
event a Holder is terminated as a Service Provider for Cause, either
before the end of the Performance Period or after the end of the
Performance Period but prior to the amount of the Award having been paid,
the Holders participation in the Plan shall cease, all outstanding Awards
of Performance Shares or Performance Units to such Participant and any
right to receive the payment for any Awards (whether or not any
Performance Period has been completed) shall be canceled.
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24
9.9
|
Other
Restrictions.
The Committee
shall have the power to impose such other restrictions on Awards subject
to Section 9 as it may deem necessary or appropriate to insure that such
Awards satisfy all requirements for "performance-based compensation"
within the meaning of Section 162(m)(4)(B) of the Code or any successor
thereto.
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SECTION 10
REORGANIZATION, CHANGE IN CONTROL OR LIQUIDATION
10.1
|
Change in
Control
. In order to
maintain the Holder's rights in the event of any Change in Control of the
Company, the Committee, as constituted before such Change in Control, may,
in its sole discretion, as to any Award, either at the time an Award is
made hereunder or any time thereafter, take any one (1) or more of the
following actions: (i) provide for the purchase by the Company of any such
Award, upon the Holder's request, for an amount of cash (if any) equal to
the amount that could have been attained upon the exercise of such Award
or realization of the Holder's rights had such Award been currently
exercisable or payable; (ii) make such adjustment to any such Award then
outstanding as the Committee deems appropriate to reflect such Change in
Control; (iii) cause any such Award then outstanding to be assumed, or new
rights substituted therefor, by the acquiring or surviving corporation
after such Change in Control; (iv) remove restrictions or exercise
conditions on any Award or modify the performance requirements for any
Awards; or (v) provide that Options, SARs or other Awards granted
hereunder must be exercised in connection with the closing of such
transactions, and that if not so exercised such Awards will expire. Any
such determinations by the Committee may be made generally with respect to
all Holders, or may be made on a case-by-case basis with respect to a
particular Holder.
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10.2
|
Acceleration Upon
Involuntary Termination Following Change in Control
. Except where (i) an Award Agreement or any
other agreement approved by the Committee to which a Holder is a party, or
(ii) any employee benefit plan or program applicable to a Holder,
addresses the effect of a Change in Control or termination of employment
following a Change in Control on an Award, in which case such agreement,
plan or program will control, in the event that within the period
commencing on a Change in Control and
ending on the second anniversary of the Change in Control, the
Company terminates a Holder's employment other than for Cause, there shall
be an automatic acceleration of any time periods relating to the exercise
or realization of any such Award and any performance goal relating to any
award with performance-based vesting shall be deemed satisfactorily
completed without any action required by the Committee so that such Award
may be exercised or realized in full on or before a date fixed by the
Committee. The Committee may, in its discretion, include such further
provisions and limitations in any Award Agreement as it may deem in the
best interests of the Company.
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25
10.3
|
Code Section 409A
. For any payment under the Plan that
constitutes deferred compensation under Code Section 409A, in no event
shall any action be taken pursuant to this Section 10 to the extent such
action would result in accelerated taxation and/or tax penalties under
Code Section 409A.
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|
|
SECTION 11
RIGHTS OF EMPLOYEES; PARTICIPANTS
11.1
|
Employment
. Nothing
contained in the Plan or in any Award granted under the Plan shall confer
upon any Participant any right with respect to the continuation of his or
her services as a Service Provider or interfere in any way with the right
of the Company, subject to the terms of any separate employment or
consulting agreement to the contrary, at any time to terminate such
services or to increase or decrease the compensation of the Participant
from the rate in existence at the time of the grant of an Award. Whether
an authorized leave of absence, or absence in military or government
service, shall constitute a termination of Participants services as a
Service Provider shall be determined by the Committee at the
time.
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11.2
|
Nontransferability
.
Except as provided in Section 11.3, no right or interest of any Holder in
an Award granted pursuant to the Plan shall be assignable or transferable
during the lifetime of the Participant, either voluntarily or
involuntarily, or be subjected to any lien, directly or indirectly, by
operation of law, or otherwise, including execution, levy, garnishment,
attachment, pledge or bankruptcy. In the event of a Participants death, a
Holders rights and interests in all Awards shall, to the extent not
otherwise prohibited hereunder, be transferable by testamentary will or
the laws of descent and distribution, and payment of any amounts due under
the Plan shall be made to, and exercise of any Options or SARs may be made
by, the Holders legal representatives, heirs or legatees. If, in the
opinion of the Committee, a person entitled to payments or to exercise
rights with respect to the Plan is disabled from caring for his or her
affairs because of a mental condition, physical condition or age, payment
due such person may be made to, and such rights shall be exercised by,
such persons guardian, conservator, or other legal personal
representative upon furnishing the Committee with evidence satisfactory to
the Committee of such status. Transfers shall not be deemed to include
transfers to the Company or cashless exercise procedures with third
parties who provide financing for the purpose of (or who otherwise
facilitate) the exercise of Awards consistent with applicable laws and the
authorization of the Committee.
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26
11.3
|
Permitted Transfers
. Pursuant to conditions and procedures
established by the Committee from time to time, the Committee may permit
Awards to be transferred, without consideration other than nominal
consideration, exercised by and paid to certain persons or entities
related to a Participant, including members of the Participants immediate
family, charitable institutions, or trusts or other entities whose
beneficiaries or beneficial owners are members of the Participants
immediate family and/or charitable institutions (a Permitted
Transferee). In the case of initial Awards, at the request of the
Participant, the Committee may permit the naming of the related person or
entity as the Award recipient. Any permitted transfer shall be subject to
the condition that the Committee receive evidence satisfactory to it that
the transfer is being made for estate and/or tax planning purposes on a
gratuitous or donative basis and without consideration (other than nominal
consideration). Notwithstanding the foregoing, Incentive Stock Options
shall only be transferable to the extent permitted in Section 422 of the
Code, or such successor provision thereto, and the treasury regulations
thereunder.
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SECTION 12
GENERAL RESTRICTIONS
12.1
|
Investment Representations
. The Company may require any person to whom an Option or other
Award is granted, as a condition of exercising such Option or receiving
Stock under the Award, to give written assurances in substance and form
satisfactory to the Company and its counsel to the effect that such person
is acquiring the Stock subject to the Option or the Award for his or her
own account for investment and not with any present intention of selling
or otherwise distributing the same, and to such other effects as the
Company deems necessary or appropriate in order to comply with federal and
applicable state securities laws. Legends evidencing such restrictions may
be placed on the certificates evidencing the Stock.
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12.2
|
Compliance with Securities Laws
.
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(a)
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Each Award shall be
subject to the requirement that, if at any time counsel to the Company
shall determine that the listing, registration or qualification of the
Shares subject to such Award upon any securities exchange or under any
state or federal law, or the consent or approval of any governmental or
regulatory body, is necessary as a condition of, or in connection with,
the issuance or purchase of Shares thereunder, such Award may not be
accepted or exercised in whole or in part unless such listing,
registration, qualification, consent or approval shall have been effected
or obtained on conditions acceptable to the Committee. Nothing herein
shall be deemed to require the Company to apply for or to obtain such
listing, registration or qualification.
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(b)
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Each Holder who is a
director or an Executive Officer is restricted from taking any action with
respect to any Award if such action would result in a (i) violation of
Section 306 of the Sarbanes-Oxley Act of 2002, and the regulations
promulgated thereunder, whether or not such law and regulations are
applicable to the Company, or (ii) any policies adopted by the Company
restricting transactions in the Stock.
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27
12.3
|
Stock Restriction
Agreement
. The Committee
may provide that Shares issuable upon the exercise of an Option shall,
under certain conditions, be subject to restrictions whereby the Company
has (i) a right of first refusal with respect to such Shares, (ii)
specific rights or limitations with respect to the Participants ability
to vote such Shares, or (iii) a right or obligation to repurchase all or a
portion of such Shares, which restrictions may survive a Participants
cessation or termination as a Service Provider.
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SECTION 13
OTHER EMPLOYEE BENEFITS
The amount of any
compensation deemed to be received by a Participant as a result of the exercise
of an Option or the grant, payment or vesting of any other Award shall not
constitute earnings with respect to which any other benefits of such
Participant are determined, including benefits under (a) any pension, profit
sharing, life insurance or salary continuation plan or other employee benefit
plan of the Company or (b) any agreement between the Company and the
Participant, except as such plan or agreement shall otherwise expressly provide.
SECTION 14
PLAN AMENDMENT, MODIFICATION AND TERMINATION
14.1
|
Amendment,
Modification, and Termination
. The Board may at any time terminate, and from time to time may
amend or modify, the Plan; provided, however, that no amendment or
modification may become effective without approval of the amendment or
modification by the stockholders if stockholder approval is required to
enable the Plan to satisfy any applicable statutory or regulatory
requirements, to comply with the requirements for listing on any exchange
where the Shares are listed, or if the Company, on the advice of counsel,
determines that stockholder approval is otherwise necessary or
desirable.
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14.2
|
Adjustment Upon
Certain Unusual or Nonrecurring Events
. The Board may make adjustments in the
terms and conditions of Awards in recognition of unusual or nonrecurring
events (including the events described in Section 4.3) affecting the
Company or the financial statements of the Company or of changes in
applicable laws, regulations, or accounting principles, whenever the Board
determines that such adjustments are appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to
be made available under the Plan.
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14.3
|
Awards Previously
Granted
. Notwithstanding
any other provision of the Plan to the contrary (but subject to a Holder's
employment being terminated for Cause and Section 14.2), no termination,
amendment or modification of the Plan shall adversely affect in any
material way any Award previously granted under the Plan, without the
written or electronic consent of the Holder of such
Award.
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SECTION 15
WITHHOLDING
15.1
|
Withholding
Requirement
. The Companys
obligations to deliver Shares upon the exercise of an Option, or upon the
vesting of any other Award, shall be subject to the
Holders satisfaction of all applicable
federal, state and local income and other tax withholding requirements.
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28
15.2
|
Withholding with Stock
. For Eligible Employees, the Committee may, in its sole
discretion, permit the Holder to pay all minimum required amounts of tax
withholding, or any part thereof, by electing to transfer to the Company,
or to have the Company withhold from Shares otherwise issuable to the
Holder, Shares having a value not to exceed the minimum amount required to
be withheld under federal, state or local law or such lesser amount as may
be elected by the Holder. All elections shall be subject to the approval
or disapproval of the Committee or its delegate. The value of Shares to be
withheld shall be based on the Fair Market Value of the Stock on the date
that the amount of tax to be withheld is to be determined (the "Tax
Date"), as determined by the Committee. Any such elections by Holder to
have Shares withheld for this purpose will be subject to the following
restrictions:
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(a)
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All elections must be
made prior to the Tax Date;
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(b)
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All elections shall
be irrevocable; and
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(c)
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If the Holder is an
officer or director of the Company within the meaning of Section 16 of the
1934 Act (Section 16), the Holder must satisfy the requirements of such
Section 16 and any applicable rules thereunder with respect to the use of
Stock to satisfy such tax withholding
obligation.
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SECTION 16
NONEXCLUSIVITY OF THE PLAN
Neither the adoption of the
Plan by the Board nor the submission of the Plan to stockholders of the Company
for approval shall be construed as creating any limitations on the power or
authority of the Board or the Committee to continue to maintain or adopt such
other or additional incentive or other compensation arrangements of whatever
nature as the Board or the Committee, as the case may be, may deem necessary or
desirable or preclude or limit the continuation of any other plan, practice or
arrangement for the payment of compensation or fringe benefits to employees, or
non-employee directors generally, or to any class or group of employees, or
non-employee directors, which the Company now has lawfully put into effect,
including any retirement, pension, savings and stock purchase plan, insurance,
death and disability benefits and executive short-term incentive plans.
SECTION 17
REQUIREMENTS OF LAW
17.1
|
Requirements of
Law
. The issuance of Stock
and the payment of cash pursuant to the Plan shall be subject to all
applicable laws, rules and regulations, and to such approvals by any
governmental agencies or stock exchanges as may be required.
Notwithstanding any provision of the Plan or any Award, Holders shall not
be entitled to exercise, or receive benefits under any Award, and the
Company shall not be obligated to deliver any Shares or other benefits to
a Holder, if such exercise or delivery would constitute a violation by the
Holder or the Company of any applicable law or regulation.
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29
17.2
|
Code Section
409A
. This Plan and all
Awards granted thereunder are intended to meet or be exempt from the
requirements of Code section 409A and shall be administered, construed and
interpreted in a manner that is accordance with and in furtherance of such
intent. In the event that any provision of this Plan shall be determined
to contravene Code section 409A, the regulations promulgated thereunder,
regulatory interpretations or announcements with respect to section 409A
or applicable judicial decisions construing section 409A, any such
provision shall be void and have no effect. Any payments described in the
Plan that are due within the "short-term deferral period" as defined in
Code section 409A shall not be treated as deferred compensation unless
applicable laws require otherwise.
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17.3
|
Rule
16b-3
. Each transaction
under the Plan is intended to comply with all applicable conditions of
Rule 16b-3, to the extent Rule 16b-3 reasonably may be relevant or
applicable to such transaction. To the extent any provision of the Plan or
any action by the Committee under the Plan fails to so comply, such
provision or action shall, without further action by any person, be deemed
to be automatically amended to the extent necessary to effect compliance
with Rule 16b-3; provided, however, that if such provision or action
cannot be amended to effect such compliance, such provision or action
shall be deemed null and void to the extent permitted by law and deemed
advisable by the Committee.
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17.4
|
Governing
Law
. The Plan and all
agreements hereunder shall be construed in accordance with and governed by
the laws of the state of Delaware without giving effect to the principles
of the conflict of laws to the contrary.
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30
Layne Christensen Company (delisted) (NASDAQ:LAYN)
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