Attached files
Exhibit 10.7
PGT,
INC.
AMENDED
AND RESTATED
2006
EQUITY INCENTIVE PLAN
1. Purpose; Types of Awards;
Construction.
The
purposes of the PGT, Inc. Amended and Restated 2006 Equity Incentive Plan (the
“Plan”) are to afford an incentive to non-employee directors, selected officers
and other employees, advisors and consultants of PGT, Inc. (the “Company”), or
any Parent or Subsidiary of the Company that now exists or hereafter is
organized or acquired, to continue as non-employee directors, officers,
employees, advisors or consultants, as the case may be, to increase their
efforts on behalf of the Company and its Subsidiaries and to promote the success
of the Company’s business. The Plan provides for the grant of Options
(including “incentive stock options” and “nonqualified stock options”), stock
appreciation rights, restricted stock, restricted stock units and other
equity-based awards. The Plan is designed so that Awards granted
hereunder intended to comply with the requirements for “performance-based
compensation” under Section 162(m) of the Code may comply with such
requirements.
The Plan
was amended and restated effective March 18, 2010, subject to the approval of
the affirmative vote of a majority of the issued and outstanding shares of Stock
present, in person or by proxy, at the Company’s 2010 annual meeting of
stockholders and entitled to vote thereon.
2. Definitions.
For
purposes of the Plan, the following terms shall be defined as set forth
below:
(a) “Award”
means any Option, SAR, Restricted Stock, Restricted Stock Unit or Other
Stock-Based Award granted under the Plan.
(b) “Award
Agreement” means any written agreement, contract or other instrument or document
evidencing an Award.
(c) “Board”
means the Board of Directors of the Company.
(d) “Change
in Control means the occurrence of any of the following:
(i) any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than one or more Permitted Holders, is or becomes the
beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act,
except that for purposes of this clause such person or group shall be deemed to
have “beneficial ownership” of all securities that such person or group has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of Voting Stock of the Company or
the Subsidiary representing 50% or more of the voting power of the total
outstanding Voting Stock of the Company or the Subsidiary;
(ii) during
any period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of the Company (together with any new
directors whose election to such Board of Directors or whose nomination for
election was approved by a vote of a majority of the members of the Board of
Directors of the Company, which members constituting such majority are then
still in office and were either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the Board of Directors of the Company;
or
(iii) the
stockholders of the Company approve a plan of liquidation or dissolution of the
Company or there is consummated an agreement for the sale or other disposition,
directly or indirectly, by the Company of all or substantially all of the
Company’s assets, other than such sale or other disposition by the Company of
all or substantially all of the Company’s assets to an entity, more than fifty
percent (50%) of the combined voting power of the Voting Stock 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.
For
purposes of this Section 2(d) only:
“Control”
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract, or otherwise, and the terms
“Controlling” and “Controlled” have meanings correlative thereto.
“Controlled
Investment Affiliate” means, as to any Person, any other Person which directly
or indirectly is in Control of, is Controlled by, or is under common Control
with, such Person and is organized by such Person (or any Person Controlling
such Person) primarily for making equity or debt investments in the Company or
other portfolio companies.
“Equity
Interest” shall mean, with respect to any Person, any and all shares, interests,
participations or other equivalents, including membership interests (however
designated, whether voting or nonvoting), of equity of such Person, including,
if such Person is a partnership, partnership interests (whether general or
limited) and any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions of
property of, such partnership, but excluding debt securities convertible or
exchangeable into such equity.
“Permitted
Holder” means JLL Partners Fund IV, L.P. and its Controlled Investment
Affiliates.
“Person”
means any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization, limited liability
company or government or other entity.
“Voting
Stock” means, with respect to any Person, any class or classes of Equity
Interests pursuant to which the holders thereof have the general voting power
under ordinary circumstances to elect at least a majority of the board of
directors (or the functional equivalent) of such Person.
(e) “Code”
means the Internal Revenue Code of 1986, as amended from time to time, and the
rules and regulations promulgated thereunder.
(f) “Committee”
means the committee, if any, established by the Board to administer the Plan,
the composition of which shall at all times consist of “non-employee directors”
within the meaning of Rule 16b-3, and “outside directors” within the meaning of
Section 162(m) of the Code.
(g) “Company”
means PGT, Inc., a corporation organized under the laws of the State of
Delaware, or any successor corporation.
(h) “Covered
Employee” has the meaning ascribed to such term under Section 162(m) of the
Code.
(i) “Effective
Date” means June 27, 2006.
(j) “Exchange
Act” means the Securities Exchange Act of 1934, as amended from time to time,
and the rules and regulations promulgated thereunder.
(k) “Fair
Market Value” means, with respect to Stock or other property, the fair market
value of such Stock or other property determined by such methods or procedures
as shall be established from time to time by the Board. Unless
otherwise determined by the Board in good faith, the per share Fair Market Value
of Stock as of a particular date shall mean (i) the closing sales price per
share of Stock on the national securities exchange on which the Stock is
principally traded, for the last preceding date on which there was a sale of
such Stock on such exchange; (ii) if the shares of Stock are then traded in an
over-the-counter market, the average of the closing bid and asked prices for the
shares of Stock in such over-the-counter market for the last preceding date on
which there was a sale of such Stock in such market; or (iii) if the shares of
Stock are not then listed on a national securities exchange or traded in an
over-the-counter market, such value as the Board, in its sole discretion, shall
determine.
(l) “ISO”
means any Option intended to be and designated as an incentive stock option
within the meaning of Section 422 of the Code.
(m) “NQSO”
means any Option that is not designated as an ISO.
(n) “Option”
means a right, granted to a Participant under Section 6(b)(i), to purchase
shares of Stock. An Option may be either an ISO or an NQSO, provided
that ISOs may be granted only to employees of the Company or a Parent or
Subsidiary of the Company.
(o) “Other
Stock-Based Award” means a right or other interest granted to a Participant that
may be denominated or payable in, valued in whole or in part by reference to, or
otherwise based on, or related to, Stock, including but not limited to (i)
unrestricted Stock awarded as a bonus or upon the attainment of Performance
Goals or otherwise as permitted under the Plan and (ii) a right granted to a
Participant to acquire Stock from the Company containing terms and conditions
prescribed by the Board.
(p) “Parent”
means a “parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.
(q) “Participant”
means a person who, as a non-employee director, officer or other employee,
advisor or consultant to the Company or a Parent or Subsidiary of the Company,
has been granted an Award under the Plan.
(r) “Performance
Goals” means performance goals based on one or more of the following criteria,
determined in accordance with generally accepted accounting principles, where
applicable: (i) pre-tax income or after-tax income; (ii) earnings
including operating income, earnings before or after taxes, earnings before or
after interest, depreciation, amortization, or extraordinary or special items;
(iii) net income excluding amortization of intangible assets, depreciation and
impairment of goodwill and intangible assets; (iv) operating income; (v)
earnings or book value per share (basic or diluted); (vi) return on assets
(gross or net), return on investment, return on capital, or return on equity;
(vii) return on revenues; (viii) net tangible assets (working capital plus
property, plants and equipment) or return on net tangible assets (operating
income divided by average net tangible assets); (ix) operating cash flow
(operating income plus or minus changes in working capital less capital
expenditures); (x) cash flow, free cash flow, cash flow return on investment
(discounted or otherwise), net cash provided by operations, or cash flow in
excess of cost of capital; (xi) economic value created; (xii) operating margin
or profit margin; (xiii) stock price or total stockholder return; (xiv) earnings
from continuing operations; (xv) cost targets, reductions or savings,
productivity or efficiencies; (xvi) strategic business criteria, consisting of
one or more objectives based on meeting specified market penetration or market
share, geographic business expansion, customer satisfaction, employee
satisfaction, human resources management, supervision of litigation, information
technology, or goals relating to divestitures, joint ventures or similar
transactions; or (xvii) any other criteria determined by the Board to be
appropriate. Where applicable, the Performance Goals may be expressed
in terms of attaining a specified level of the particular criterion or the
attainment of a percentage increase or decrease in the particular criterion, and
may be applied to one or more of the Company or a Parent or Subsidiary of the
Company, or a division or strategic business unit of the Company, all as
determined by the Board. The Performance Goals may include a
threshold level of performance below which no payment will be made (or no
vesting will occur), levels of performance at which specified payments will be
paid (or specified vesting will occur) and a maximum level of performance above
which no additional payment will be made (or at which full vesting will
occur). Each of the foregoing Performance Goals shall be evaluated in
accordance with generally accepted accounting principles, where applicable, and
shall be subject to certification by the Board. The Board shall have
the authority to make equitable adjustments to the Performance Goals in
recognition of unusual or non-recurring events affecting the Company or any
Parent or Subsidiary of the Company or the financial statements of the Company
or any Parent or Subsidiary of the Company, in response to changes in applicable
laws or regulations or to account for items of gain, loss or expense determined
to be extraordinary or unusual in nature or infrequent in occurrence or related
to the disposal of a segment of a business or related to a change in accounting
principles.
(s) “Plan”
means this PGT, Inc. Amended and Restated 2006 Equity Incentive Plan, as amended
from time to time.
(t) “Restricted
Stock” means an Award of shares of Stock to a Participant under Section
6(b)(iii) that may be subject to certain restrictions and to a risk of
forfeiture.
(u) “Restricted
Stock Unit” or “RSU” means a right granted to a Participant under Section
6(b)(iv) to receive Stock or cash at the end of a specified period, which right
may be conditioned on the satisfaction of specified performance or other
criteria.
(v) “Rule
16b-3” means Rule 16b-3, as from time to time in effect promulgated by the
Securities and Exchange Commission under Section 16 of the Exchange Act,
including any successor to such Rule.
(w) “Securities
Act” means the Securities Act of 1933, as amended from time to time, and the
rules and regulations promulgated thereunder.
(x) “Stock”
means shares of the common stock, par value $0.01 per share, of the
Company.
(y) “Stock
Appreciation Right” or “SAR” means the right, granted to a Participant under
Section 6(b)(ii), to be paid an amount measured by the appreciation in the Fair
Market Value of Stock from the date of grant to the date of exercise of the
right.
(z) “Subsidiary”
means a “subsidiary corporation,” whether now or hereafter existing, as defined
in Section 424(f) of the Code.
3. Administration.
The Plan
shall be administered by the Board. The Board may appoint a Committee
to administer all or a portion of the Plan and to make recommendations to the
Board with respect to the Plan and any Awards; provided, that such Committee’s
authorities and responsibilities shall always be limited by the Board’s sole
authority to make all final determinations under the Plan. The Board
or the Committee may appoint and delegate to another person or committee any or
all of the authority of the Board or the Committee, as applicable, with respect
to Awards to Participants other than Participants who are subject to potential
liability under Section 16(b) of the Exchange Act with respect to transactions
involving equity securities of the Company at the time any such delegated
authority is exercised. With respect to Awards that are intended to
meet the performance-based compensation exception to Section 162(m) of the Code
and that are made to a Participant who is or is reasonably expected to be a
Covered Employee, such delegation shall not include any authority, which if
exercised by the delegate(s) rather than by the Committee, would cause the
Participant’s Award to fail to meet such exception. The Committee or
any other person to whom the Board has delegated duties as aforesaid may employ
one or more persons to render advice with respect to any responsibility the
Board or such Committee or person may have under the Plan. No member
of the Board or Committee shall be liable for any action taken or determination
made in good faith with respect to the Plan or any Award granted
hereunder.
The Board
shall have the authority in its discretion, subject to and not inconsistent with
the express provisions of the Plan, to administer the Plan and to exercise all
the powers and authorities either specifically granted to it under the Plan or
necessary or advisable in the administration of the Plan, including, without
limitation, the authority to: (i) grant Awards; (ii) determine the
persons to whom and the time or times at which Awards shall be granted; (iii)
determine the type and number of Awards to be granted, the number of shares of
Stock to which an Award may relate and the terms, conditions, restrictions and
performance criteria relating to any Award; (iv) determine Performance Goals no
later than such time as required to ensure that an underlying Award that is
intended to comply with the requirements of Section 162(m) of the Code so
complies; (v) determine whether, to what extent, and under what circumstances an
Award may be settled, cancelled, forfeited, exchanged, or surrendered; (vi) make
adjustments in the terms and conditions of, and the Performance Goals (if any)
included in, Awards; (vii) construe and interpret the Plan and any Award; (viii)
prescribe, amend and rescind rules and regulations relating to the Plan; (ix)
determine the terms and provisions of the Award Agreements (which need not be
identical for each Participant); and (x) make all other determinations deemed
necessary or advisable for the administration of the Plan. All
decisions, determinations and interpretations of the Board shall be final and
binding on all persons, including but not limited to the Company, any parent or
subsidiary of the Company, any Participant (or any person claiming any rights
under the Plan from or through any Participant) and any
stockholder.
4. Eligibility.
Awards
may be granted to selected non-employee directors, officers and other employees,
advisors or consultants of the Company or any Parent or Subsidiary of the
Company, in the discretion of the Board. In determining the persons
to whom Awards shall be granted and the type of any Award (including the number
of shares to be covered by such Award), the Board shall take into account such
factors as the Board shall deem relevant in connection with accomplishing the
purposes of the Plan.
5. Stock Subject to the
Plan.
The
maximum number of shares of Stock reserved for the grant of Awards under the
Plan shall be 7,000,000, subject to adjustment as provided herein. No
more than 7,000,000 shares of Stock may be made subject to Options (which may be
ISOs or NQSOs) or SARs granted under the Plan, and no more than 2,000,000 shares
of Stock may be made subject to stock-based awards other than Options or SARs
(including Restricted Stock and Restricted Stock Units or Other Stock-Based
Awards), in either case, subject to adjustment as provided
herein. The maximum number of shares of Stock that may be made
subject to Awards granted to any Covered Employee in any calendar year may not
exceed 1,500,000. Such shares may, in whole or in part, be authorized
but unissued shares or shares that shall have been or may be reacquired by the
Company in the open market, in private transactions or otherwise. If
any shares subject to an Award are forfeited, cancelled, exchanged or
surrendered or if an Award terminates or expires without a distribution of
shares to the Participant, or if shares of Stock are surrendered or withheld as
payment of either the exercise price of an Award and/or withholding taxes in
respect of an Award, the shares of Stock with respect to such Award shall, to
the extent of any such forfeiture, cancellation, exchange, surrender,
withholding, termination or expiration, again be available for Awards under the
Plan. Upon the exercise of any Award granted in tandem with any other
Award, such related Award shall be cancelled to the extent of the number of
shares of Stock as to which the Award is exercised and, notwithstanding the
foregoing, such number of shares shall no longer be available for Awards under
the Plan.
In the
event that the Board shall determine that any dividend or other distribution
(whether in the form of cash, Stock, or other property), recapitalization, Stock
split, reverse split, reorganization, merger, consolidation, spin-off,
combination, repurchase, or share exchange, or other similar corporate
transaction or event, affects the Stock such that an adjustment is appropriate
in order to prevent dilution or enlargement of the rights of Participants under
the Plan, then the Board shall make such equitable changes or adjustments as it
deems necessary or appropriate to any or all of: (i) the number and
kind of shares of Stock or other property (including cash) that may thereafter
be issued in connection with Awards; (ii) the number and kind of shares of Stock
or other property (including cash) issued or issuable in respect of outstanding
Awards; (iii) the exercise price, grant price or purchase price relating to any
Award; provided, that, with respect to ISOs, such adjustment shall be made in
accordance with Section 424(h) of the Code; and (iv) the Performance Goals
applicable to outstanding Awards; provided, however, that no such adjustment
shall cause any Award hereunder which is or becomes subject to Section 409A of
the Code to fail to comply with the requirements of such section. In
addition, the Board may determine that any such equitable adjustment may be
accomplished by making a payment to the Award holder, in the form of cash or
other property (including but not limited to shares of Stock).
6. Terms of
Awards.
(a) General. The
term of each Award shall be for such period as may be determined by the
Board. Subject to the terms of the Plan and any applicable Award
Agreement, payments to be made by the Company or a Parent or Subsidiary of the
Company upon the grant, vesting, maturation or exercise of an Award may be made
in such forms as the Board shall determine at the date of grant or thereafter,
including, without limitation, cash, Stock or other property, and may be made in
a single payment or transfer, in installments or on a deferred
basis. The Board may make rules relating to installment or deferred
payments with respect to Awards, including the rate of interest to be credited
with respect to such payments. In addition to the foregoing, the
Board may impose on any Award or the exercise thereof, at the date of grant or
thereafter, such additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Board shall determine.
(b) Terms of Specified
Awards. The Board is authorized to grant the Awards described
in this Section 6(b), under such terms and conditions as deemed by the Board to
be consistent with the purposes of the Plan. Such Awards may be
granted with vesting, value and/or and payment contingent upon Performance
Goals. Except as otherwise set forth herein or as may be determined
by the Board, each Award granted under the Plan shall be evidenced by an Award
Agreement containing such terms and conditions applicable to such Award as the
Board shall determine at the date of grant or thereafter.
(i) Options. The
Board is authorized to grant Options to Participants on the following terms and
conditions:
(A) Type of
Award. The Award Agreement evidencing the grant of an Option
under the Plan shall designate the Option as an ISO or an NQSO.
(B) Exercise
Price. The exercise price per share of Stock purchasable under
an Option shall be determined by the Board, but in no event shall the per share
exercise price of any Option be less than the Fair Market Value of a share of
Stock on the date of grant of such Option. The exercise price for
Stock subject to an Option may be paid in cash or by an exchange of Stock
previously owned by the Participant, through a “broker cashless exercise”
procedure approved by the Board (to the extent permitted by law) or a
combination of the above, in any case in an amount having a combined value equal
to such exercise price; provided that the Board may require that any Stock
exchanged by the Participant have been owned by the Participant for at least six
months as of the date of exercise. An Award Agreement may provide
that a Participant may pay all or a portion of the aggregate exercise price by
having shares of Stock with a Fair Market Value on the date of exercise equal to
the aggregate exercise price withheld by the Company.
(C) Term and Exercisability of
Options. Options shall be exercisable over the exercise period
(which shall not exceed ten years from the date of grant), at such times and
upon such conditions as the Board may determine, as reflected in the Award
Agreement; provided, that the Board shall have the authority to accelerate the
exercisability of any outstanding Option at such time and under such
circumstances as it, in its sole discretion, deems appropriate. An
Option may be exercised to the extent of any or all full shares of Stock as to
which the Option has become exercisable, by giving written notice of such
exercise to the Board or its designated agent.
(D) Termination of
Employment. An Option may not be exercised
unless: (1) the Participant is then a director of, in the employ of,
or providing services to, the Company or a Parent or Subsidiary of the Company;
and (2) the Participant has remained continuously so employed, or continuously
maintained such relationship, since the date of grant of the Option; provided,
that the Award Agreement may contain provisions extending the exercisability of
Options, in the event of specified terminations of employment or service, to a
date not later than the expiration date of such Option.
(E) Other
Provisions. Options may be subject to such other conditions
including, but not limited to, restrictions on transferability of the shares
acquired upon exercise of such Options, as the Board may prescribe in its
discretion or as may be required by applicable law.
(ii) SARs. The
Board is authorized to grant SARs to Participants on the following terms and
conditions:
(A) In
General. Unless the Board determines otherwise, an SAR (1)
granted in tandem with an NQSO may be granted at the time of grant of the
related NQSO or at any time thereafter or (2) granted in tandem with an ISO may
only be granted at the time of grant of the related ISO. An SAR
granted in tandem with an Option shall be exercisable only to the extent the
underlying Option is exercisable. Payment of an SAR may be made in
cash, Stock or property as specified in the Award or determined by the
Board.
(B) Right
Conferred. An SAR shall confer on the Participant a right to
receive an amount with respect to each share subject thereto, upon exercise
thereof, equal to the excess of (1) the Fair Market Value of one share of Stock
on the date of exercise over (2) the grant price of the SAR (which in the case
of an SAR granted in tandem with an Option shall be equal to the exercise price
of the underlying Option, and which in the case of any other SAR shall be such
price as the Board may determine), and may be paid with or without interest, as
determined by the Board, where the date of exercise is earlier than the date on
which payment in respect of the SAR is made.
(C) Term and Exercisability of
SARs. SARs shall be exercisable over the exercise period
(which shall not exceed the lesser of ten years from the date of grant or, in
the case of a tandem SAR, the expiration of its related Award), at such times
and upon such conditions as the Board may determine, as reflected in the Award
Agreement; provided, that the Board shall have the authority to accelerate the
exercisability of any outstanding SAR at such time and under such circumstances
as it, in its sole discretion, deems appropriate. An SAR may be
exercised to the extent of any or all full shares of Stock as to which the SAR
(or, in the case of a tandem SAR, its related Award) has become exercisable, by
giving written notice of such exercise to the Board or its designated
agent.
(D) Termination of
Employment. An SAR may not be exercised unless: (1)
the Participant is then a director of, in the employ of, or providing services
to, the Company or a Parent or Subsidiary of the Company; and (2) the
Participant has remained continuously so employed, or continuously maintained
such relationship, since the date of grant of the SAR; provided, that the Award
Agreement may contain provisions extending the exercisability of SAR, in the
event of specified terminations of employment or service, to a date not later
than the expiration date of such SAR (or, in the case of a tandem SAR, its
related Award).
(E) Other
Provisions. SARs may be subject to such other conditions
including, but not limited to, restrictions on transferability of the shares
acquired upon exercise of such SARs, as the Board may prescribe in its
discretion or as may be required by applicable law.
(iii) Restricted
Stock. The Board is authorized to grant Restricted Stock to
Participants on the following terms and conditions:
(A) Issuance and
Restrictions. Restricted Stock shall be subject to such
restrictions on transferability and other restrictions, if any, as the Board may
impose at the date of grant or thereafter, which restrictions may lapse
separately or in combination at such times, under such circumstances, in such
installments, or otherwise, as the Board may determine. The Board may
place restrictions on Restricted Stock that shall lapse, in whole or in part,
only upon the attainment of Performance Goals. Unless otherwise
determined by the Board, a Participant granted Restricted Stock shall have all
of the rights of a stockholder including, without limitation, the right to vote
Restricted Stock and the right to receive dividends thereon.
(B) Forfeiture. Upon
termination of employment with or service to the Company during the applicable
restriction period, Restricted Stock and any accrued but unpaid dividends that
are then subject to restrictions shall be forfeited; provided, that the Board
may provide, by rule or regulation or in any Award Agreement, or may determine
in any individual case, that restrictions or forfeiture conditions relating to
Restricted Stock will be waived in whole or in part in the event of terminations
resulting from specified causes, and the Board may in other cases waive in whole
or in part the forfeiture of Restricted Stock.
(C) Certificates for
Stock. Restricted Stock granted under the Plan may be
evidenced in such manner as the Board shall determine. If
certificates representing Restricted Stock are registered in the name of the
Participant, such certificates shall bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Restricted Stock, and the
Company shall retain physical possession of the certificate.
(D) Dividends. Dividends
paid on Restricted Stock shall be either paid at the dividend payment date, or
deferred for payment to such date as determined by the Board, in cash or in
shares of Stock having a Fair Market Value equal to the amount of such
dividends. Unless otherwise determined by the Board, Stock
distributed in connection with a stock split or stock dividend, and other
property distributed as a dividend, shall be subject to restrictions and a risk
of forfeiture to the same extent as the Restricted Stock with respect to which
such Stock or other property has been distributed.
(iv) Restricted Stock
Units. The Board is authorized to grant Restricted Stock Units
to Participants, subject to the following terms and conditions:
(A) Award and
Restrictions. Delivery of Stock or cash, as determined by the
Board, will occur upon expiration of the period specified for Restricted Stock
Units by the Board during which forfeiture conditions apply, or such later date
as the Board shall determine. The Board may place restrictions on
Restricted Stock Units that shall lapse, in whole or in part, only upon the
attainment of Performance Goals.
(B) Forfeiture. Upon
termination of employment with or service to the Company prior to the vesting of
a Restricted Stock Unit, or upon failure to satisfy any other conditions
precedent to the delivery of Stock or cash to which such Restricted Stock Units
relate, all Restricted Stock Units and any accrued but unpaid dividend
equivalents that are then subject to deferral or restriction shall be forfeited;
provided, that the Board may provide, by rule or regulation or in any Award
Agreement, or may determine in any individual case, that restrictions or
forfeiture conditions relating to Restricted Stock Units will be waived in whole
or in part in the event of termination resulting from specified causes, and the
Board may in other cases waive in whole or in part the forfeiture of Restricted
Stock Units.
(C) Dividend
Equivalents. The Board may in its discretion determine whether
Restricted Stock Units may be credited with dividend equivalents at such time as
dividends, whether in the form of cash, Stock or other property, are paid with
respect to the Stock. Any such dividend equivalents shall be credited
in the form of additional Restricted Stock Units and shall subject to
restrictions and a risk of forfeiture to the same extent as the Restricted Stock
Unit with respect to which such dividend equivalent was credited.
(v) Other Stock-Based
Awards. The Board is authorized to grant Awards to
Participants in the form of Other Stock-Based Awards, as deemed by the Board to
be consistent with the purposes of the Plan. Awards granted pursuant
to this paragraph may be granted with vesting, value and/or payment contingent
upon Performance Goals. The Board shall determine the terms and
conditions of such Awards at the date of grant or thereafter. Without
limiting the generality of this paragraph, Other Stock-Based Awards may include
unrestricted shares of Stock to be issued in respect of bonuses and Stock-based
units issued in respect of one or more non-qualified deferred compensation
programs which may be adopted by the Company.
7. Change in Control
Provisions.
Unless
otherwise determined by the Board and evidenced in an Award Agreement, in the
event of a Change of Control:
(a) any Award
carrying a right to exercise that was not previously vested and exercisable
shall become fully vested and exercisable; and
(b) the
restrictions, deferral limitations, payment conditions and forfeiture conditions
applicable to any other Award granted under the Plan shall lapse and such Awards
shall be deemed fully vested, and any performance conditions imposed with
respect to Awards shall be deemed to be fully achieved.
8. General
Provisions.
(a) Nontransferability. Unless
otherwise provided in an Award Agreement, Awards shall not be transferable by a
Participant except by will or the laws of descent and distribution and shall be
exercisable during the lifetime of a Participant only by such Participant or his
guardian or legal representative.
(b) No Right to Continued
Employment, etc. Nothing in the Plan or in any Award, any
Award Agreement or other agreement entered into pursuant hereto shall confer
upon any Participant the right to continue in the employ of, or to continue as a
director of, or to continue to provide services to, the Company or any Parent or
Subsidiary of the Company or to be entitled to any remuneration or benefits not
set forth in the Plan or such Award Agreement or other agreement or to interfere
with or limit in any way the right of the Company or any such Parent or
Subsidiary to terminate such Participant’s employment or director or independent
contractor relationship.
(c) Taxes. The
Company or any Parent or Subsidiary of the Company is authorized to withhold
from any Award granted, any payment relating to an Award under the Plan,
including from a distribution of Stock, or any other payment to a Participant,
amounts of withholding and other taxes due in connection with any transaction
involving an Award, and to take such other action as the Board may deem
advisable to enable the Company and Participants to satisfy obligations for the
payment of withholding taxes and other tax obligations relating to any
Award. This authority shall include authority to withhold or receive
Stock or other property and to make cash payments in respect thereof in
satisfaction of a Participant’s tax obligations. The Board may
provide in the Award Agreement that in the event that a Participant is required
to pay any amount to be withheld in connection with the issuance of shares of
Stock in settlement or exercise of an Award, the Participant may satisfy such
obligation (in whole or in part) by electing to have the Company withhold a
portion of the shares of Stock to be received upon settlement or exercise of
such Award that is equal to the minimum amount required to be
withheld.
(d) Effective Date; Amendment
and Termination.
(i) The Plan
shall take effect upon the Effective Date; provided, however, that holders of a
majority of the issued and outstanding shares of Stock shall have previously
approved the Plan.
(ii) The Plan
was amended and restated effective March 18, 2010, subject to the approval of
the affirmative vote of a majority of the issued and outstanding shares of Stock
present, in person or by proxy, at the Company’s 2010 annual meeting of
stockholders and entitled to vote thereon.
(iii) The Board
may at any time and from time to time alter, amend, suspend or terminate the
Plan in whole or in part; provided, however, that unless otherwise determined by
the Board, an amendment that requires stockholder approval in order for the Plan
to comply with Section 162(m) or any other law, regulation or stock exchange
requirement shall not be effective unless approved by the requisite vote of
stockholders. The Board may at any time and from time to time alter,
amend, suspend or terminate an outstanding Award in whole or in
part. Notwithstanding the foregoing sentence of this clause (ii), no
alteration or amendment to or suspension or termination of the Plan or any Award
shall affect adversely any of the rights of any Participant, without such
Participant’s consent, under any Award theretofore granted under the
Plan.
(e) Expiration of
Plan. Unless earlier terminated by the Board pursuant to the
provisions of the Plan, the Plan shall expire on the tenth anniversary of the
Effective Date. No Awards shall be granted under the Plan after such
expiration date. The expiration of the Plan shall not affect
adversely any of the rights of any Participant, without such Participant’s
consent, under any Award theretofore granted.
(f) Deferrals. The
Board shall have the authority to establish such procedures and programs that it
deems appropriate to provide Participants with the ability to defer receipt of
cash, Stock or other property payable with respect to Awards granted under the
Plan.
(g) No Rights to Awards; No
Stockholder Rights. No Participant shall have any claim to be
granted any Award under the Plan. There is no obligation for
uniformity of treatment among Participants. Except as provided
specifically herein, a Participant or a transferee of an Award shall have no
rights as a stockholder with respect to any shares covered by the Award until
the date of the issuance of a stock certificate to him for such
shares.
(h) Unfunded Status of
Awards. The Plan is intended to constitute an “unfunded” plan
for incentive and deferred compensation. With respect to any payments
not yet made to a Participant pursuant to an Award, nothing contained in the
Plan or any Award shall give any such Participant any rights that are greater
than those of a general creditor of the Company.
(i) No Fractional
Shares. No fractional shares of Stock shall be issued or
delivered pursuant to the Plan or any Award. The Board shall
determine whether cash, other Awards or other property shall be issued or paid
in lieu of such fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.
(j) Regulations and Other
Approvals.
(i) The
obligation of the Company to sell or deliver Stock with respect to any Award
granted under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Board.
(ii) Each
Award is subject to the requirement that, if at any time the Board determines,
in its absolute discretion, that the listing, registration or qualification of
Stock issuable pursuant to the Plan is required by any securities exchange or
under any state or federal law, or the consent or approval of any governmental
regulatory body is necessary or desirable as a condition of, or in connection
with, the grant of an Award or the issuance of Stock, no such Award shall be
granted or payment made or Stock issued, in whole or in part, unless listing,
registration, qualification, consent or approval has been effected or obtained
free of any conditions not acceptable to the Board.
(iii) In the
event that the disposition of Stock acquired pursuant to the Plan is not covered
by a then-current registration statement under the Securities Act and is not
otherwise exempt from such registration, such Stock shall be restricted against
transfer to the extent required by the Securities Act or regulations thereunder,
and the Board may require a Participant receiving Stock pursuant to the Plan, as
a condition precedent to receipt of such Stock, to represent to the Company in
writing that the Stock acquired by such Participant is acquired for investment
only and not with a view to distribution.
(iv) The Board
may require a Participant receiving Stock pursuant to the Plan, as a condition
precedent to receipt of such Stock, to enter into a stockholder agreement or
“lock-up” agreement in such form as the Board shall determine is necessary or
desirable to further the Company’s interests.
(k) Section 409A
Compliance. The intent of the Company is that payments and
benefits under the Plan comply with Section 409A of the Code to the extent
subject thereto, and, accordingly, to the maximum extent permitted, the Plan
shall be interpreted and be administered to be in compliance
therewith. Notwithstanding anything contained herein to the contrary,
to the extent required in order to avoid accelerated taxation and/or tax
penalties under Section 409A of the Code, a Participant shall not be considered
to have terminated employment with the Company for purposes of the Plan and no
payment shall be due to the Participant under the Plan or any Award Agreement
until the Participant would be considered to have incurred a “separation from
service” from the Company within the meaning of Section 409A of the
Code. Any payments described in the Plan that are due within the
“short term deferral period” as defined in Section 409A of the Code shall not be
treated as deferred compensation unless applicable law requires
otherwise. Notwithstanding anything to the contrary in the Plan, to
the extent necessary to avoid imposition of any individual excise tax and late
interest charges imposed under Section 409A of the Code, the settlement and
payment of all or any portion of any Award that is to be paid or settled as part
of a separation pay plan shall instead be made on the first business day after
the date that is six months following such separation from service (or the date
of death, if earlier).
(l) Equity
Exchange. Notwithstanding any other provision of the Plan to
the contrary, upon approval of the Company’s stockholders at its 2010 annual
meeting of stockholders, the Company may offer to employees of the Company or
its Subsidiary the opportunity to tender certain outstanding equity awards
granted under the Plan or the Company’s 2004 Stock Incentive Plan for
cancellation in exchange for the issuance of a replacement Option that will
represent the ability to purchase, at a lower exercise price and subject to a
new term and new vesting schedule, shares of Stock, provided that such offer to
exchange such outstanding equity awards is completed within three months of the
date of the receipt of such stockholder approval.
(m) Governing
Law. The Plan and all determinations made and actions taken
pursuant hereto shall be governed by the laws of the State of Delaware without
giving effect to the conflict of laws principles thereof.