Attached files
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8-K - 8-K - Fluent, Inc. | g21080e8vk.htm |
EX-2.5 - EX-2.5 - Fluent, Inc. | g21080exv2w5.htm |
EX-3.3 - EX-3.3 - Fluent, Inc. | g21080exv3w3.htm |
EX-99.2 - EX-99.2 - Fluent, Inc. | g21080exv99w2.htm |
Exhibit
10.13
SEARCHMEDIA
HOLDINGS LIMITED
AMENDED
AND RESTATED 2008 SHARE INCENTIVE PLAN
PREAMBLE
SearchMedia International Limited originally established the
2008 Share Incentive Plan, effective January 1, 2008.
In connection with certain transactions (the Merger)
pursuant to Plan of Merger, Conversion and Share Exchange
between SearchMedia International Limited and SearchMedia
Holdings Limited (as well as other parties), SearchMedia
International Limited has become a wholly owned subsidiary of
SearchMedia Holdings Limited. In connection with the Merger,
SearchMedia Holdings Limited, subject to and effective only upon
the approval of its shareholders, hereby assumes, amends and
restates the 2008 Share Incentive Plan as follows.
ARTICLE 1
PURPOSE
The purpose of this 2008 Amended and Restated Share Incentive
Plan (the Plan) is to promote the success and
enhance the value of SearchMedia Holdings Limited, a company
incorporated under the laws of the Cayman Islands (the
Company) by linking the personal interests of
the members of the Board, Employees, and Consultants to those of
the Companys shareholders and by providing such
individuals with an incentive for outstanding performance to
generate superior returns to Company shareholders. The Plan is
further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of members
of the Board, Employees, and Consultants upon whose judgment,
interest, and special effort the successful conduct of the
Companys operation is largely dependent.
ARTICLE 2
DEFINITIONS
AND CONSTRUCTION
Wherever the following terms are used in the Plan, they shall
have the meanings specified below, unless the context clearly
indicates otherwise. The singular pronoun shall include the
plural where the context so indicates.
2.1 Applicable Laws means
(i) the laws of the Cayman Islands as they relate to the
Company and its Shares; (ii) the legal requirements
relating to the Plan and the Awards under applicable provisions
of the corporate, securities, tax and other laws, rules,
regulations and government orders; and (iii) the rules of
any applicable stock exchange or national market system, of any
jurisdiction applicable to Awards granted to residents therein.
2.2 Article means an article of
this Plan.
2.3 Award means an Option,
Restricted Share or Restricted Share Units award granted to a
Participant pursuant to the Plan.
2.4 Award Agreement means any
written agreement, contract, or other instrument or document
evidencing an Award, including through electronic medium.
2.5 Board means the Board of
Directors of the Company from time to time.
2.6 Change in Control means, as
applicable, a change in ownership or control of the Company
effected through either of the following transactions:
(a) Prior to the date of the effectiveness of the
Companys first registration statement on
Form F-1
filed with the U.S. Securities and Exchange Commission (the
SEC), the direct or indirect acquisition by
any person or related group of persons (other than an
acquisition from or by the Company) of beneficial ownership
(within the meaning of
Rule 13d-3
under the Exchange Act) of securities possessing
1
more than seventy-five percent (75%) of the total combined
voting power of the Companys outstanding
securities; or
(b) After the date of the effectiveness of the
Companys first registration statement on
Form F-1
filed with the SEC,
(i) The direct or indirect acquisition by any person or
related group of persons (other than an acquisition from or by
the Company) of beneficial ownership (within the meaning of
Rule 13d-3
under the Exchange Act) of securities possessing more than fifty
percent (50%) of the total combined voting power of the
Companys outstanding securities pursuant to a tender or
exchange offer made directly to the Companys shareholders
which a majority of the Incumbent Board (as defined below) who
are not affiliates or associates of the offeror under
Rule 12b-2
promulgated under the Exchange Act do not recommend such
shareholders accept; or
(ii) The individuals, who are members of the Board as of
the date of the effectiveness of the Companys first
registration statement on
Form F-1
filed with the SEC (the Incumbent Board), cease for
any reason to constitute at least fifty percent (50%) of the
Board; provided that if the election, or nomination for election
by the Companys shareholders, of any new member of the
Board is approved by a vote of at least fifty percent (50%) of
the Incumbent Board, such new member of the Board shall be
considered as a member of the Incumbent Board.
2.7 Code means the Internal
Revenue Code of 1986 of the United States, as amended.
2.8 Committee means the committee
of the Board described in Article 9.
2.9 Consultant means any
consultant or adviser if: (a) the consultant or adviser
renders bona fide services to a Service Recipient; (b) the
services rendered by the consultant or adviser are not in
connection with the offer or sale of securities in a
capital-raising transaction and do not directly or indirectly
promote or maintain a market for the Companys securities;
and (c) the consultant or adviser is a natural person who
has contracted directly with the Service Recipient to render
such services.
2.10 Corporate Transaction means
any of the following transactions:
(a) an amalgamation, arrangement or consolidation or scheme
of arrangement (i) in which the Company is not the
surviving entity, except for a transaction the principal purpose
of which is to change the jurisdiction in which the Company is
incorporated, or (ii) following which the holders of the
voting securities of the Company do not continue to hold more
than fifty percent (50%) of the combined voting power of the
voting securities of the surviving entity;
(b) the sale, transfer or other disposition of all or
substantially all of the assets of the Company; or
(c) the completion of a voluntary or insolvent liquidation
or dissolution of the Company.
2.11 Disability means that the
Participant qualifies to receive long-term disability payments
under the Service Recipients long-term disability
insurance program, as it may be amended from time to time, to
which the Participant provides services regardless of whether
the Participant is covered by such policy. If the Service
Recipient to which the Participant provides service does not
have a long-term disability plan in place,
Disability means that a Participant is unable to
carry out the responsibilities and functions of the position
held by the Participant by reason of any medically determinable
physical or mental impairment for a period of not less than
ninety (90) consecutive days. A Participant will not be
considered to have incurred a Disability unless he or she
furnishes proof of such impairment sufficient to satisfy the
Committee in its discretion.
2.12 Effective Date shall have
the meaning set forth in Section 10.1.
2.13 Employee means any person,
including an officer or member of the Board of the Company, any
Parent or Subsidiary of the Company, who is in the employ of a
Service Recipient, subject to the control and direction of the
Service Recipient as to both the work to be performed and the
manner and method of performance. The payment of a
directors fee by a Service Recipient shall not be
sufficient to constitute employment by the Service
Recipient.
2
2.14 Exchange Act means the
Securities Exchange Act of 1934 of the United States, as amended.
2.15 Fair Market Value means, as
of any date, the value of Shares determined as follows:
(a) If the Shares are listed on one or more established and
regulated stock exchanges or national market systems, its Fair
Market Value shall be the closing sales price for such shares
(or the closing bid, if no sales were reported) as quoted on the
principal exchange or system on which the Shares are listed (as
determined by the Committee) on the date of determination (or,
if no closing sales price or closing bid was reported on that
date, as applicable, on the last trading date such closing sales
price or closing bid was reported), as reported in The Wall
Street Journal or such other source as the Committee deems
reliable;
(b) If the Shares are regularly quoted on an automated
quotation system or by a recognized securities dealer, its Fair
Market Value shall be the closing sales price for such shares as
quoted on such system or by such securities dealer on the date
of determination, but if selling prices are not reported, the
Fair Market Value of a Share shall be the mean between the high
bid and low asked prices for the Shares on the date of
determination (or, if no such prices were reported on that date,
on the last date such prices were reported), as reported in
The Wall Street Journal or such other source as the
Committee deems reliable; or
(c) In the absence of an established market for the Shares
of the type described in (a) and (b), above, the Fair
Market Value thereof shall be determined by the Committee in
good faith and in its discretion by reference to (i) the
placing price of the latest private placement of the Shares and
the development of the Companys business operations and
the general economic and market conditions since such latest
private placement, (ii) other third party transactions
involving the Shares and the development of the Companys
business operation and the general economic and market
conditions since such sale, (iii) an independent valuation
of the Shares, or (iv) such other methodologies or
information as the Committee determines to be indicative of Fair
Market Value, relevant.
2.16 Incentive Share Option means
an Option that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto.
2.17 Independent Director means a
member of the Board who is not an Employee of the Company.
2.18 Non-Employee Director means
a member of the Board who qualifies as a Non-Employee
Director as defined in
Rule 16b-3(b)(3)
under the Exchange Act, or any successor definition adopted by
the Board.
2.19 Non-Qualified Share Option
means an Option that is not intended to be an Incentive Share
Option.
2.20 Option means a right granted
to a Participant pursuant to Article 5 of the Plan to
purchase a specified number of Shares at a specified price
during specified time periods. An Option may be either an
Incentive Share Option or a Non-Qualified Share Option.
2.21 Participant means a person
who, as a member of the Board, Consultant or Employee, has been
granted an Award pursuant to the Plan.
2.22 Parent means a parent
corporation under Section 424(e) of the Code.
2.23 Plan means this Amended and
Restated 2008 Share Incentive Award Plan, as it may be
amended from time to time.
2.24 Related Entity means any
business, corporation, partnership, limited liability company or
other entity in which the Company, a Parent or Subsidiary of the
Company holds a substantial ownership interest, directly or
indirectly but which is not a Subsidiary and which the Board
designates as a Related Entity for purposes of the Plan.
2.25 Restricted Share means a
Share awarded to a Participant pursuant to Article 6 that
is subject to certain restrictions and may be subject to risk of
forfeiture.
3
2.26 Restricted Share Unit means
the right granted to a Participant pursuant to Article 6 to
receive a Share at a future date.
2.27 Securities Act means the
Securities Act of 1933 of the United States, as amended.
2.28 Service Recipient means the
Company, any Parent or Subsidiary of the Company and any Related
Entity to which a Participant provides services as an Employee,
Consultant or as a Director.
2.29 Share means a share of the
Company, and such other securities of the Company that may be
substituted for Shares pursuant to Article 8.
2.30 Subsidiary means any
corporation or other entity of which a majority of the
outstanding voting shares or voting power is beneficially owned
directly or indirectly by the Company.
2.31 Trading Date means the
closing of the first sale to the general public of the Shares
pursuant to an effective registration statement under Applicable
Law, which results in the Shares being publicly traded on one or
more established stock exchanges or national market systems.
ARTICLE 3
SHARES
SUBJECT TO THE PLAN
3.1 Number of Shares.
(a) Subject to the provisions of Article 8 and
Section 3.1(b), the aggregate number of Shares which may be
issued or transferred pursuant to Awards under the Plan is
1,796,452.
(b) To the extent that an Award terminates, expires, or
lapses for any reason, any Shares subject to the Award shall
again be available for the grant of an Award pursuant to the
Plan. To the extent permitted by Applicable Laws, Shares issued
in assumption of, or in substitution for, any outstanding awards
of any entity acquired in any form or combination by the Company
or any Parent or Subsidiary of the Company shall not be counted
against Shares available for grant pursuant to the Plan. Shares
delivered by the Participant or withheld by the Company upon the
exercise of any Award under the Plan, in payment of the exercise
price thereof or tax withholding thereon, may again be optioned,
granted or awarded hereunder, subject to the limitations of
Section 3.1(a). If any Restricted Shares are forfeited by
the Participant or repurchased by the Company, such Shares may
again be optioned, granted or awarded hereunder, subject to the
limitations of Section 3.1(a). Notwithstanding the
provisions of this Section 3.1(b), no Shares may again be
optioned, granted or awarded if such action would cause an
Incentive Share Option to fail to qualify as an incentive share
option under Section 422 of the Code.
3.2 Shares Distributed. Any Shares
issued pursuant to an Award may consist, in whole or in part, of
authorized and unissued Shares, treasury Shares (subject to
Applicable Laws) or Shares purchased on the open market.
Additionally, in the discretion of the Committee, American
Depository Shares in an amount equal to the number of Shares
which otherwise would be distributed pursuant to an Award may be
distributed in lieu of Shares in settlement of any Award. If the
number of Shares represented by an American Depository Share is
other than on a one-to-one basis, the limitations of
Section 3.1 shall be adjusted to reflect the distribution
of American Depository Shares in lieu of Shares.
ARTICLE 4
ELIGIBILITY
AND PARTICIPATION
4.1 Eligibility. Persons eligible
to participate in this Plan include Employees, Consultants, and
all members of the Board, as determined by the Committee.
4.2 Participation. Subject to the
provisions of the Plan, the Committee may, from time to time,
select from among all eligible individuals, those to whom Awards
shall be granted and shall determine the nature and amount of
each Award. No individual shall have any right to be granted an
Award pursuant to this Plan.
4
4.3 Jurisdictions. In order to
assure the viability of Awards granted to Participants employed
in various jurisdictions, the Committee may provide for such
special terms as it may consider necessary or appropriate to
accommodate differences in local law, tax policy, or custom
applicable in the jurisdiction in which the Participant resides
or is employed. Moreover, the Committee may approve such
supplements to, or amendments, restatements, or alternative
versions of, the Plan as it may consider necessary or
appropriate for such purposes without thereby affecting the
terms of the Plan as in effect for any other purpose;
provided, however, that no such supplements, amendments,
restatements, or alternative versions shall increase the share
limitations contained in Section 3.1 of the Plan.
Notwithstanding the foregoing, the Committee may not take any
actions hereunder, and no Awards shall be granted, that would
violate any Applicable Laws.
ARTICLE 5
OPTIONS
5.1 General. The Committee is
authorized to grant Options to Participants on the following
terms and conditions:
(a) Exercise Price. The exercise
price per Share subject to an Option shall be determined by the
Committee and set forth in the Award Agreement which may be a
fixed or variable price related to the Fair Market Value of the
Shares; provided, however, that no Option may be
granted to an individual subject to taxation in the United
States at less than the Fair Market Value on the date of grant,
without the Participants consent. The exercise price per
Share subject to an Option may be amended or adjusted in the
absolute discretion of the Committee, the determination of which
shall be final, binding and conclusive. For the avoidance of
doubt, to the extent not prohibited by Applicable Laws or any
exchange rule, a re-pricing of Options mentioned in the
preceding sentence shall be effective without the approval of
the Companys shareholders or the approval of the
Participants. Notwithstanding the foregoing, the exercise price
per Share subject to an Option shall not be increased without
the approval of the affected Participants.
(b) Time and Conditions of
Exercise. The Committee shall determine the
time or times at which an Option may be exercised in whole or in
part, including exercise prior to vesting; provided that
the term of any Option granted under the Plan shall not exceed
ten years, except as provided in Section 11.1. The
Committee shall also determine any conditions, if any, that must
be satisfied before all or part of an Option may be exercised.
(c) Payment. The Committee shall
determine the methods by which the exercise price of an Option
may be paid, the form of payment, including, without limitation
(i) cash or check denominated in a currency determined by
the Committee, and subject to Applicable Law, (ii) Shares
held for such period of time as may be required by the Committee
in order to avoid adverse financial accounting consequences and
having a Fair Market Value on the date of delivery equal to the
aggregate exercise price of the Option or exercised portion
thereof, (v) after the Trading Date the delivery of a
notice that the Participant has placed a market sell order with
a broker with respect to Shares then issuable upon exercise of
the Option, and that the broker has been directed to pay a
sufficient portion of the net proceeds of the sale to the
Company in satisfaction of the Option exercise price;
provided that payment of such proceeds is then made to
the Company upon settlement of such sale, (vi) other
property acceptable to the Committee with a Fair Market Value
equal to the exercise price, or (vii) any combination of
the foregoing. Notwithstanding any other provision of the Plan
to the contrary, no Participant shall be permitted to pay the
exercise price of an Option in any method which would violate
Applicable Law.
(d) Evidence of Grant. All Options
shall be evidenced by an Award Agreement between the Company and
the Participant. The Award Agreement shall include such
additional provisions as may be specified by the Committee.
5.2 Incentive Share
Options. Incentive Share Options may be
granted to Employees of the Company, a Parent or Subsidiary of
the Company. Incentive Share Options may not be granted to
Employees of a Related
5
Entity or to Independent Directors or Consultants. The terms of
any Incentive Share Options granted pursuant to the Plan, in
addition to the requirements of Section 5.1, must comply
with the following additional provisions of this
Section 5.2:
(a) Expiration of Option. An
Incentive Share Option may not be exercised to any extent by
anyone after the first to occur of the following events:
(i) Ten years from the date it is granted, unless an
earlier time is set in the Award Agreement;
(ii) 90 days after the Participants termination
of employment as an Employee (save in the case of termination on
account of Disability or death or for cause); and
(iii) One year after the date of the Participants
termination of employment or service on account of Disability or
death. Upon the Participants Disability or death, any
Incentive Share Options exercisable at the Participants
Disability or death may be exercised by the Participants
legal representative or representatives, by the person or
persons entitled to do so pursuant to the Participants
last will and testament, or, if the Participant fails to make
testamentary disposition of such Incentive Share Option or dies
intestate, by the person or persons entitled to receive the
Incentive Share Option pursuant to the applicable laws of
descent and distribution.
(b) Individual Dollar
Limitation. The aggregate Fair Market Value
(determined as of the time the Option is granted) of all Shares
with respect to which Incentive Share Options are first
exercisable by a Participant in any calendar year may not exceed
U.S.$100,000 or such other limitation as imposed by
Section 422(d) of the Code, or any successor provision. To
the extent that Incentive Share Options are first exercisable by
a Participant in excess of such limitation, the excess shall be
considered Non-Qualified Share Options.
(c) Ten Percent Owners. An
Incentive Share Option shall be granted to any individual who,
at the date of grant, owns Shares possessing more than ten
percent of the total combined voting power of all classes of
shares of the Company only if such Option is granted at a price
that is not less than 110% of Fair Market Value on the date of
grant and the Option is exercisable for no more than five years
from the date of grant.
(d) Transfer Restriction. The
Participant shall give the Company prompt notice of any
disposition of Shares acquired by exercise of an Incentive Share
Option within (i) two years from the date of grant of such
Incentive Share Option or (ii) one year after the transfer
of such Shares to the Participant.
(e) Expiration of Incentive Share
Options. No Award of an Incentive Share
Option may be made pursuant to this Plan after the tenth
anniversary of the Effective Date.
(f) Right to Exercise. During a
Participants lifetime, an Incentive Share Option may be
exercised only by the Participant.
ARTICLE 6
RESTRICTED
SHARES AND RESTRICTED SHARE UNITS
6.1 Grant of Restricted
Shares. The Committee is authorized to make
Awards of Restricted Shares
and/or
Restricted Share Units to any Participant selected by the
Committee in such amounts and subject to such terms and
conditions as determined by the Committee. All Awards of
Restricted Shares shall be evidenced by an Award Agreement.
6.2 Issuance and
Restrictions. Restricted Shares shall be
subject to such restrictions on transferability and other
restrictions as the Committee may impose (including, without
limitation, limitations on the right to vote Restricted Shares
or the right to receive dividends on the Restricted Share).
These restrictions may lapse separately or in combination at
such times, pursuant to such circumstances, in such
installments, or otherwise, as the Committee determines at the
time of the grant of the Award or thereafter.
6
6.3 Forfeiture/Repurchase. Except
as otherwise determined by the Committee at the time of the
grant of the Award or thereafter, upon termination of employment
or service during the applicable restriction period, Restricted
Shares that are at that time subject to restrictions shall be
forfeited or repurchased in accordance with the Award Agreement;
provided, however, that the Committee may
(a) provide in any Restricted Share Award Agreement that
restrictions or forfeiture and repurchase conditions relating to
Restricted Shares will be waived in whole or in part in the
event of terminations resulting from specified causes, and
(b) in other cases waive in whole or in part restrictions
or forfeiture and repurchase conditions relating to Restricted
Shares.
6.4 Certificates for Restricted
Shares. Restricted Shares granted pursuant to
the Plan may be evidenced in such manner as the Committee shall
determine. If certificates representing Restricted Shares are
registered in the name of the Participant, certificates must
bear an appropriate legend referring to the terms, conditions,
and restrictions applicable to such Restricted Shares, and the
Company may, at its discretion, retain physical possession of
the certificate until such time as all applicable restrictions
lapse.
6.5 Restricted Share Units. At the
time of grant, the Committee shall specify the date or dates on
which the Restricted Share Units shall become fully vested and
nonforfeitable, and may specify such conditions to vesting as it
deems appropriate. At the time of grant, the Committee shall
specify the maturity date applicable to each grant of Restricted
Share Units which shall be no earlier than the vesting date or
dates of the Award and may be determined at the election of the
grantee. On the maturity date, the Company shall, subject to
Sections 7.4 and 7.5, transfer to the Participant one
unrestricted, fully transferable Share for each Restricted Share
Unit scheduled to be paid out on such date and not previously
forfeited.
ARTICLE 7
PROVISIONS
APPLICABLE TO AWARDS
7.1 Award Agreement. Awards under
the Plan shall be evidenced by Award Agreements that set forth
the terms, conditions and limitations for each Award which may
include the term of an Award, the provisions applicable in the
event the Participants employment or service terminates,
and the Companys authority to unilaterally or bilaterally
amend, modify, suspend, cancel or rescind an Award.
7.2 Limits on Transfer. No right
or interest of a Participant in any Award may be pledged,
encumbered, or hypothecated to or in favor of any party other
than the Company or a Subsidiary, or shall be subject to any
lien, obligation, or liability of such Participant to any other
party other than the Company or a Subsidiary. Except as
otherwise provided by the Committee, no Award shall be assigned,
transferred, or otherwise disposed of by a Participant other
than by will or the laws of descent and distribution. The
Committee by express provision in the Award or an amendment
thereto may permit an Award (other than an Incentive Share
Option) to be transferred to, exercised by and paid to certain
persons or entities related to the Participant, including but
not limited to members of the Participants family,
charitable institutions, or trusts or other entities whose
beneficiaries or beneficial owners are members of the
Participants family
and/or
charitable institutions, or to such other persons or entities as
may be expressly approved by the Committee, pursuant to such
conditions and procedures as the Committee may establish. 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 (or to a blind trust in connection
with the Participants termination of employment or service
with the Company or a Subsidiary to assume a position with a
governmental, charitable, educational or similar non-profit
institution) and on a basis consistent with the Companys
lawful issue of securities.
7.3 Beneficiaries. Notwithstanding
Section 7.2, a Participant may, in the manner determined by
the Committee, designate a beneficiary to exercise the rights of
the Participant and to receive any distribution with respect to
any Award upon the Participants death. A beneficiary,
legal guardian, legal representative, or other person claiming
any rights pursuant to the Plan is subject to all terms and
conditions of the Plan and any Award Agreement applicable to the
Participant, except to the extent the Plan and Award Agreement
otherwise provide, and to any additional restrictions deemed
necessary or appropriate by the Committee. If the Participant is
married and resides in a community property jurisdiction, a
designation of a person other than
7
the Participants spouse as his or her beneficiary with
respect to more than 50% of the Participants interest in
the Award shall not be effective without the prior written
consent of the Participants spouse. If no beneficiary has
been designated or survives the Participant, payment shall be
made to the person entitled thereto pursuant to the
Participants will or the laws of descent and distribution.
Subject to the foregoing, a beneficiary designation may be
changed or revoked by a Participant at any time provided the
change or revocation is filed with the Committee.
7.4 Share
Issuance. Notwithstanding anything herein to
the contrary, the Company shall not be required to issue or
deliver any certificates or make any book entries evidencing
Shares pursuant to the exercise of any Award, unless and until
the Board has determined, with advice of counsel, that the
issuance and delivery of such Shares is in compliance with all
Applicable Laws, regulations of governmental authorities and, if
applicable, the requirements of any exchange on which the Shares
are listed or traded. All Share certificates delivered pursuant
to the Plan and all Shares issued pursuant to book entry
procedures are subject to any stop-transfer orders and other
restrictions as the Committee deems necessary or advisable to
comply with all Applicable Laws, and the rules of any national
securities exchange or automated quotation system on which the
Shares are listed, quoted, or traded. The Committee may place
legends on any Share certificate to reference restrictions
applicable to the Share. In addition to the terms and conditions
provided herein, the Board may require that a Participant make
such reasonable covenants, agreements, and representations as
the Board, in its discretion, deems advisable in order to comply
with any such laws, regulations, or requirements. The Committee
shall have the right to require any Participant to comply with
any timing or other restrictions with respect to the settlement
or exercise of any Award, including a window-period limitation,
as may be imposed in the discretion of the Committee.
Notwithstanding any other provision of the Plan, unless
otherwise determined by the Committee or required by Applicable
Law, the Company shall not deliver to any Participant
certificates evidencing Shares issued in connection with any
Award and instead such Shares shall be recorded in the books of
the Company (or, as applicable, its transfer agent or stock plan
administrator).
7.5 Paperless
Administration. Subject to Applicable Laws,
the Committee may establish, for itself or using the services of
a third party, an automated system for the documentation,
granting or exercise of Awards, such as a system using an
internet website or interactive voice response, then the
paperless documentation, granting or exercise of Awards by a
Participant may be permitted through the use of such an
automated system.
7.6 Applicable Currency. Unless
otherwise required by Applicable Law, or as determined in the
discretion of the Committee, all Awards shall be designated in
U.S. dollars. A Participant may be required to provide
evidence that any currency used to pay the exercise price of any
Award were acquired and taken out of the jurisdiction in which
the Participant resides in accordance with Applicable Laws,
including foreign exchange control laws and regulations. In the
event the exercise price for an Award is paid in Chinese
Renminbi or other foreign currency, as permitted by the
Committee, the amount payable will be determined by conversion
from U.S. dollars at the official rate promulgated by the
Peoples Bank of China for Chinese Renminbi, or for
jurisdictions other than the Peoples Republic of China,
the exchange rate as selected by the Committee on the date of
exercise.
ARTICLE 8
CHANGES IN
CAPITAL STRUCTURE
8.1 Adjustments. In the event of
any distribution, share split, combination or exchange of
Shares, amalgamation, arrangement or consolidation,
reorganization of the Company, including the Company becoming a
subsidiary in a transaction not involving a Corporate
Transaction, spin-off, recapitalization or other distribution
(other than normal cash dividends) of Company assets to its
shareholders, or any other change affecting the Shares or the
share price of a Share, the Committee shall make such
proportionate and equitable adjustments, if any, to reflect such
change with respect to (a) the aggregate number and type of
shares that may be issued under the Plan (including, but not
limited to, adjustments of the limitations in Section 3.1
and substitutions of shares in a parent or surviving company);
(b) the terms and conditions of any outstanding Awards
(including, without limitation, any applicable performance
targets or criteria with respect
8
thereto); and (c) the grant or exercise price per share for
any outstanding Awards under the Plan. The form and manner of
any such adjustments shall be determined by the Committee in its
sole discretion.
8.2 Acceleration upon a Change of
Control. Except as may otherwise be provided
in any Award Agreement or any other written agreement entered
into by and between the Company and a Participant, if a Change
of Control occurs and a Participants Awards are not
converted, assumed or replaced by a successor, the vesting of
such Awards shall accelerate by one (1) year upon such
Change of Control. Upon, or in anticipation of, a Change of
Control, the Committee may in its sole discretion provide for
(i) any and all Awards outstanding hereunder to terminate
at a specific time in the future and shall give each Participant
the right to exercise such Awards during a period of time as the
Committee shall determine, (ii) either the purchase of any
Award for an amount of cash equal to the amount that could have
been attained upon the exercise of such Award or realization of
the Participants rights had such Award been currently
exercisable or payable or fully vested (and, for the avoidance
of doubt, if as of such date the Committee determines in good
faith that no amount would have been attained upon the exercise
of such Award or realization of the Participant s rights,
then such Award may be terminated by the Company without
payment), (iii) the replacement of such Award with other
rights or property selected by the Committee in its sole
discretion or the assumption of or substitution of such Award by
the successor or surviving corporation, or a parent or
subsidiary thereof, with appropriate adjustments as to the
number and kind of Shares and prices, or (iv) provide for
payment of Awards in cash based on the value of Shares on the
date of the Change of Control plus reasonable interest on the
Award through the date such Award would otherwise be vested or
have been paid in accordance with its original terms, if
necessary to comply with Section 409A of the Code.
8.3 Outstanding Awards Corporate
Transactions. In the event of a Corporate
Transaction, each Award will terminate upon the consummation of
the Corporate Transaction, unless the Award is assumed by the
successor entity or Parent thereof in connection with the
Corporate Transaction. Except as provided otherwise in an
individual Award Agreement, in the event of a Corporate
Transaction and:
(a) the Award either is (x) assumed by the successor
entity or Parent thereof or replaced with a comparable Award (as
determined by the Committee) with respect to shares of the
capital stock (or equivalent) of the successor entity or Parent
thereof or (y) replaced with a cash incentive program of
the successor entity which preserves the compensation element of
such Award existing at the time of the Corporate Transaction and
provides for subsequent payout in accordance with the same
vesting schedule applicable to such Award, then such Award (if
assumed), the replacement Award (if replaced), or the cash
incentive program automatically shall become fully vested,
exercisable and payable and be released from any restrictions on
transfer (other than transfer restrictions applicable to
Options) and repurchase or forfeiture rights, immediately upon
termination of the Participants employment or service with
all Service Recipients within twelve (12) months of the
Corporate Transaction without cause; and
(b) For each Award that is neither assumed nor replaced,
such portion of the Award shall automatically become fully
vested and exercisable and be released from any repurchase or
forfeiture rights (other than repurchase rights exercisable at
Fair Market Value) for all of the Shares at the time represented
by such portion of the Award, immediately prior to the specified
effective date of such Corporate Transaction, provided that the
Participant remains an Employee, Consultant or Director on the
effective date of the Corporate Transaction.
8.4 Outstanding Awards Other
Changes. In the event of any other change in
the capitalization of the Company or corporate change other than
those specifically referred to in this Article 8, the
Committee may, in its absolute discretion, make such adjustments
in the number and class of shares subject to Awards outstanding
on the date on which such change occurs and in the per share
grant or exercise price of each Award as the Committee may
consider appropriate to prevent dilution or enlargement of
rights.
8.5 No Other Rights. Except as
expressly provided in the Plan, no Participant shall have any
rights by reason of any subdivision or consolidation of shares
of any class, the payment of any dividend, any increase or
decrease in the number of shares of any class or any
dissolution, liquidation, merger, or consolidation of the
Company or any other corporation. Except as expressly provided
in the Plan or pursuant to action of the Committee under the
Plan, no issuance by the Company of shares of any class, or
securities convertible into
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shares of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number of shares
subject to an Award or the grant or exercise price of any Award.
ARTICLE 9
ADMINISTRATION
9.1 Committee. The Plan shall be
administered by the Compensation Committee of the Board;
provided, however that the Compensation Committee may
delegate to a committee of one or more members of the Board the
authority to grant or amend Awards to Participants other than
Independent Directors and executive officers of the Company. The
Committee shall consist of at least two individuals, each of
whom qualifies as a Non-Employee Director. Reference to the
Committee shall refer to the Board if the Compensation Committee
has not been established or ceases to exist and the Board does
not appoint a successor Committee. Notwithstanding the
foregoing, the full Board, acting by majority of its members in
office shall conduct the general administration of the Plan if
required by Applicable Law, and with respect to Awards granted
to Independent Directors and for purposes of such Awards the
term Committee as used in the Plan shall be deemed
to refer to the Board.
9.2 Action by the Committee. A
majority of the Committee shall constitute a quorum. The acts of
a majority of the members present at any meeting at which a
quorum is present, and acts approved in writing by a majority of
the Committee in lieu of a meeting, shall be deemed the acts of
the Committee. Each member of the Committee is entitled to, in
good faith, rely or act upon any report or other information
furnished to that member by any officer or other employee of the
Company or any Subsidiary, the Companys independent
certified public accountants, or any executive compensation
consultant or other professional retained by the Company to
assist in the administration of the Plan.
9.3 Authority of
Committee. Subject to any specific
designation in the Plan, the Committee has the exclusive power,
authority and discretion to:
(a) Designate eligible Employees, Directors and Consultants
to receive Awards;
(b) Determine the type or types of Awards to be granted to
each Participant;
(c) Determine the number of Awards to be granted and the
number of Shares to which an Award will relate;
(d) Determine the terms and conditions of any Award granted
pursuant to the Plan, including, but not limited to, the
exercise price, grant price, or purchase price, any restrictions
or limitations on the Award, any schedule for lapse of
forfeiture restrictions or restrictions on the exercisability of
an Award, and accelerations or waivers thereof, any provisions
related to non-competition and recapture of gain on an Award,
based in each case on such considerations as the Committee in
its sole discretion determines;
(e) Determine whether, to what extent, and pursuant to what
circumstances an Award may be settled in, or the exercise price
of an Award may be paid in, cash, Shares, other Awards, or other
property, or an Award may be canceled, forfeited, or surrendered;
(f) Prescribe the form of each Award Agreement, which need
not be identical for each Participant;
(g) Decide all other matters that must be determined in
connection with an Award;
(h) Establish, adopt, or revise any rules and regulations
as it may deem necessary or advisable to administer the Plan;
(i) Interpret the terms of, and any matter arising pursuant
to, the Plan or any Award Agreement; and
(j) Make all other decisions and determinations that may be
required pursuant to the Plan or as the Committee deems
necessary or advisable to administer the Plan.
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9.4 Decisions Binding. The
Committees interpretation of the Plan, any Awards granted
pursuant to the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are
final, binding, and conclusive on all parties.
ARTICLE 10
EFFECTIVE
AND EXPIRATION DATE
10.1 Effective Date. The Effective
Date of the Plan is January 1, 2008.
10.2 Expiration Date. The Plan
will expire on, and no Award may be granted pursuant to the Plan
after, the tenth anniversary of the Effective Date. Any Awards
that are outstanding on the tenth anniversary of the Effective
Date shall remain in force according to the terms of the Plan
and the applicable Award Agreement.
ARTICLE 11
AMENDMENT,
MODIFICATION, AND TERMINATION
11.1 Amendment, Modification, And
Termination. With the approval of the Board,
at any time and from time to time, the Committee may terminate,
amend or modify the Plan; provided, however, that
(a) to the extent necessary and desirable to comply with
Applicable Laws, or stock exchange rules, the Company shall
obtain shareholder approval of any Plan amendment in such a
manner and to such a degree as required, and
(b) shareholder approval is required for any amendment to
the Plan that (i) increases the number of Shares available
under the Plan (other than any adjustment as provided by
Article 8), (ii) permits the Committee to extend the
term of the Plan or the exercise period for an Option beyond ten
years from the date of grant, or (iii) results in a
material increase in benefits or a change in eligibility
requirements.
11.2 Awards Previously
Granted. Except with respect to amendments
made pursuant to Section 11.1, no termination, amendment,
or modification of the Plan shall adversely affect in any
material way any Award previously granted pursuant to the Plan
without the prior written consent of the Participant.
ARTICLE 12
GENERAL
PROVISIONS
12.1 No Rights to Awards. No
Participant, employee, or other person shall have any claim to
be granted any Award pursuant to the Plan, and neither the
Company nor the Committee is obligated to treat Participants,
employees, and other persons uniformly.
12.2 No Shareholders Rights. No
Award gives the Participant any of the rights of a Shareholder
of the Company unless and until Shares are in fact issued to
such person in connection with such Award.
12.3 Taxes. No Shares shall be
delivered under the Plan to any Participant until such
Participant has made arrangements acceptable to the Committee
for the satisfaction of any income and employment tax
withholding obligations under Applicable Laws. The Company or
any Subsidiary shall have the authority and the right to deduct
or withhold, or require a Participant to remit to the Company,
an amount sufficient to satisfy all applicable taxes (including
the Participants payroll tax obligations) required or
permitted by law to be withheld with respect to any taxable
event concerning a Participant arising as a result of this Plan.
The Committee may in its discretion and in satisfaction of the
foregoing requirement allow a Participant to elect to have the
Company withhold Shares otherwise issuable under an Award (or
allow the return of Shares) having a Fair Market Value equal to
the sums required to be withheld. Notwithstanding any other
provision of the Plan, the number of Shares which may be
withheld with respect to the issuance, vesting, exercise or
payment of any Award (or which may be repurchased from the
Participant of such Award after such Shares were acquired by the
Participant from the Company) in order to satisfy all of the
Participants income and payroll tax liabilities with
respect to the issuance, vesting, exercise or payment of the
Award shall, unless specifically
11
approved by the Committee, be limited to the number of Shares
which have a Fair Market Value on the date of withholding or
repurchase equal to the aggregate amount of such liabilities
based on the minimum statutory income and payroll tax
withholding rates that are applicable to such supplemental
taxable income under Applicable Law.
12.4 No Right to Employment or
Services. Nothing in the Plan or any Award
Agreement shall interfere with or limit in any way the right of
the Service Recipient to terminate any Participants
employment or services at any time, nor confer upon any
Participant any right to continue in the employ or service of
any Service Recipient.
12.5 Effect of Plan upon Other Compensation
Plans. The adoption of the Plan shall not
affect any other compensation or incentive plans in effect for
any Service Recipient. Nothing in the Plan shall be construed to
limit the right of any Service Recipient: (a) to establish
any other forms of incentives or compensation for Employees,
Directors or Consultants, or (b) to grant or assume options
or other rights or awards otherwise than under the Plan in
connection with any proper corporate purpose including without
limitation, the grant or assumption of options in connection
with the acquisition by purchase, lease, merger, consolidation
or otherwise, of the business, stock or assets of any
corporation, partnership, limited liability company, firm or
association.
12.6 Unfunded Status of
Awards. The Plan is intended to be an
unfunded plan for incentive compensation. With
respect to any payments not yet made to a Participant pursuant
to an Award, nothing contained in the Plan or any Award
Agreement shall give the Participant any rights that are greater
than those of a general creditor of the Company or any
Subsidiary.
12.7 Indemnification. To the
extent allowable pursuant to applicable law, each member of the
Committee or of the Board shall be indemnified and held harmless
by the Company from any loss, cost, liability, or expense that
may be imposed upon or reasonably incurred by such member in
connection with or resulting from any claim, action, suit, or
proceeding to which he or she may be a party or in which he or
she may be involved by reason of any action or failure to act
pursuant to the Plan and against and from any and all amounts
paid by him or her in satisfaction of judgment in such action,
suit, or proceeding against him or her; provided he or
she gives the Company an opportunity, at its own expense, to
handle and defend the same before he or she undertakes to handle
and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled pursuant
to the Companys Memorandum of Association and Articles of
Association, as a matter of law, or otherwise, or any power that
the Company may have to indemnify them or hold them harmless.
12.8 Relationship to other
Benefits. No payment pursuant to the Plan
shall be taken into account in determining any benefits pursuant
to any pension, retirement, savings, profit sharing, group
insurance, welfare or other benefit plan of the Company or any
Subsidiary except to the extent otherwise expressly provided in
writing in such other plan or an agreement thereunder.
12.9 Expenses. The expenses of
administering the Plan shall be borne by the Company and its
Subsidiaries.
12.10 Titles and Headings. The
titles and headings of the Sections in the Plan are for
convenience of reference only and, in the event of any conflict,
the text of the Plan, rather than such titles or headings, shall
control.
12.11 Fractional Shares. No
fractional Share shall be issued and the Committee shall
determine, in its discretion, whether cash shall be given in
lieu of fractional shares or whether such fractional shares
shall be eliminated by rounding up or down as appropriate.
12.12 Government and Other
Regulations. The obligation of the Company to
make payment of awards in Shares or otherwise shall be subject
to all Applicable Laws and to such approvals by government
agencies as may be required. The Company shall be under no
obligation to register any of the Shares paid pursuant to the
Plan under the Securities Act or any other similar law in any
applicable jurisdiction. If the Shares paid pursuant to the Plan
may in certain circumstances be exempt from registration
pursuant to the Securities Act
12
or other Applicable Laws, the Company may restrict the transfer
of such Shares in such manner as it deems advisable to ensure
the availability of any such exemption.
12.13 Governing Law. The Plan and
all Award Agreements shall be construed in accordance with and
governed by the laws of the Cayman Islands.
12.14 Section 409A. To the
extent that the Committee determines that any Award granted
under the Plan is or may become subject to Section 409A of
the Code, the Award Agreement evidencing such Award shall
incorporate the terms and conditions required by
Section 409A of the Code. To the extent applicable, the
Plan and the Award Agreements shall be interpreted in accordance
with Section 409A of the Code and the U.S. Department
of Treasury regulations and other interpretative guidance issued
thereunder, including without limitation any such regulation or
other guidance that may be issued after the Effective Date.
Notwithstanding any provision of the Plan to the contrary, in
the event that following the Effective Date the Committee
determines that any Award may be subject to Section 409A of
the Code and related U.S. Department of Treasury guidance
(including such U.S. Department of Treasury guidance as may
be issued after the Effective Date), the Committee may adopt
such amendments to the Plan and the applicable Award agreement
or adopt other policies and procedures (including amendments,
policies and procedures with retroactive effect), or take any
other actions, that the Committee determines is necessary or
appropriate to (a) exempt the Award from Section 409A
of the Code and /or preserve the intended tax treatment of the
benefits provided with respect to the Award, or (b) comply
with the requirements of Section 409A of the Code and
related U.S. Department of Treasury guidance.
12.15 Appendices. The Committee
may approve such supplements, amendments or appendices to the
Plan as it may consider necessary or appropriate for purposes of
compliance with applicable laws or otherwise and such
supplements, amendments or appendices shall be considered a part
of the Plan; provided, however, that no such
supplements shall increase the share limitations contained in
Section 3.1 of the Plan.
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