Attached files
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S-1/A - FORM S-1/A - LPL Financial Holdings Inc. | b80825a2sv1za.htm |
EX-1.1 - EX-1.1 - LPL Financial Holdings Inc. | b80825a2exv1w1.htm |
EX-3.1 - EX-3.1 - LPL Financial Holdings Inc. | b80825a2exv3w1.htm |
EX-10.10 - EX-10.10 - LPL Financial Holdings Inc. | b80825a2exv10w10.htm |
EX-23.1 - EX-23.1 - LPL Financial Holdings Inc. | b80825a2exv23w1.htm |
Exhibit 10.19
LPL INVESTMENT
HOLDINGS INC.
2010 OMNIBUS EQUITY INCENTIVE PLAN
2010 OMNIBUS EQUITY INCENTIVE PLAN
1. DEFINED TERMS
Exhibit A, which is incorporated by reference, defines the
terms used in the Plan and sets forth certain operational rules
related to those terms.
2. PURPOSE
The Plan has been established to advance the interests of the
Company by providing for the grant to Participants of Awards.
3. ADMINISTRATION
The Administrator has discretionary authority, subject only to
the express provisions of the Plan, to interpret the Plan;
determine eligibility for and grant Awards; determine, modify or
waive the terms and conditions of any Award; prescribe forms,
rules and procedures; and otherwise do all things necessary to
carry out the purposes of the Plan. Determinations of the
Administrator made under the Plan will be conclusive and will
bind all parties.
4. LIMITS ON AWARDS UNDER THE PLAN
(a) Number of Shares. At the
Effective Date, the maximum number of shares of Stock that may
be delivered in satisfaction of Awards under the Plan shall be:
(1) 12,055,945 shares of the Stock; plus
(2) any shares of Stock that become available for grant
under the Companys Existing Plans after the Effective Date
as a result of termination of awards under the Existing Plans;
provided, that such shares will not be available for issuance of
ISOs.
(b) ISO Shares; Adjustments to Maximum Available
Shares. The maximum number of shares of Stock
deliverable upon the exercise of ISOs is 10,000,000 Shares
of Stock that are subject to Awards that have been terminated,
cancelled or forfeited upon termination of Employment under
Section 6(a)(4) without becoming exercisable shall be
available again for future grant under the Plan. The number of
shares of Stock delivered in satisfaction of Awards shall be
determined net of shares of Stock withheld by the Company in
payment of the exercise price of the Award or in satisfaction of
tax withholding requirements with respect to the Award and, for
the avoidance of doubt, without including any shares of Stock
underlying Awards settled in cash or which otherwise expire or
become unexercisable without having been exercised or are
forfeited to or repurchased by the Company due to failure to
vest. The limits set forth in this Section 4(b) shall be
construed to comply with Section 422. To the extent
consistent with the requirements of Section 422 and with
other applicable legal requirements (including applicable stock
exchange requirements), Stock issued under awards of an acquired
company that are converted, replaced or adjusted in connection
with the acquisition shall not reduce the number of shares
available for delivery upon the exercise of Awards under the
Plan.
(c) Type of Shares. Stock
delivered by the Company under the Plan may be authorized but
unissued Stock or previously issued Stock acquired by the
Company. No fractional shares of Stock will be delivered under
the Plan.
(d) Section 162(m)
Limits. The maximum number of shares of Stock
for which Stock Options may be granted to any person in a
calendar year and the maximum number of shares of Stock subject
to SARs granted to any person in any calendar year will each be
400,000. The maximum number of shares subject to other Awards
granted to any person in any calendar year will be
100,000 shares. The maximum amount payable to any person in
any year under Cash Awards will be $5,000,000. The foregoing
provision will be construed in a manner consistent with
Section 162(m).
5. ELIGIBILITY AND PARTICIPATION
The Administrator will select Participants from among those key
Employees, registered representatives and directors of, and
consultants and advisors to, the Company or its Affiliates who,
in the opinion of the Administrator, are in a position to make a
significant contribution to the success of the Company and its
Affiliates; provided, that, subject to such express
exceptions, if any, as the Administrator may establish,
eligibility shall be further limited to those persons as to whom
the use of a
Form S-8
registration statement is permissible. Eligibility for ISOs is
limited to employees of the Company or of a parent
corporation or subsidiary corporation of the
Company as those terms are defined in Section 424 of the
Code. Eligibility for Awards other than ISOs are limited to
individuals described in the first sentence of this
Section 5 who are providing direct services on the date of
grant of the Award to the Company or to a subsidiary of the
Company that would be described in the first sentence of Treas.
Regs. 1.409A-1(b)(5)(iii)(E).
6. RULES APPLICABLE TO AWARDS
(a) All Awards
(1) Award Provisions. The
Administrator will determine the terms of all Awards, subject to
the limitations provided herein. By accepting (or, under such
rules as the Administrator may prescribe, being deemed to have
accepted) an Award, the Participant agrees to the terms of the
Award and the Plan. Notwithstanding any provision of this Plan
to the contrary, awards of an acquired company that are
converted, replaced or adjusted in connection with the
acquisition may contain terms and conditions that are
inconsistent with the terms and conditions specified herein, as
determined by the Administrator.
(2) Term of Plan. No Awards may be
made after the date that is one day before the
10th anniversary of the Effective Date, but previously
granted Awards may continue beyond that date in accordance with
their terms.
(3) Transferability. Neither ISOs
nor, except as the Administrator otherwise expressly provides in
accordance with the second sentence of this
Section 6(a)(3), Awards that are not ISOs may be
transferred other than by will or by the laws of descent and
distribution, and during a Participants lifetime ISOs
(and, except as the Administrator otherwise expressly provides
in accordance with the second sentence of this
Section 6(a)(3), other Awards requiring exercise that are
not ISOs) may be exercised only by the Participant. The
Administrator may permit Awards that are not ISOs, but not
Awards that are ISOs, to be transferred by gift, subject to such
limitations as the Administrator may impose.
(4) Vesting, etc. The
Administrator may determine the time or times at which an Award
will vest or become exercisable and the terms on which an Award
requiring exercise will remain exercisable. Without limiting the
foregoing, the Administrator may at any time accelerate the
vesting or exercisability of an Award, regardless of any adverse
or potentially adverse tax consequences resulting from such
acceleration. Unless the Administrator expressly provides
otherwise, however, the following rules will apply:
(A) Immediately upon the cessation of the
Participants Employment, each Award requiring exercise
that is then held by the Participant or by the
Participants permitted transferees, if any, will cease to
be exercisable and will terminate, except to the extent
otherwise provided in (B), (C), (D) or (E) below, and
all other Awards that are then held by the Participant or by the
Participants permitted transferees, if any, to the extent
not already vested will be forfeited.
(B) Subject to (C), (D) and (E) below, all Stock
Options and SARs held by the Participant or the
Participants permitted transferees, if any, immediately
prior to the cessation of the Participants Employment, to
the extent then exercisable, will remain exercisable for the
lesser of (i) a period of 90 days or (ii) the
period ending on the latest date on which such Stock Option or
SAR could have been exercised without regard to this
Section 6(a)(4), and will thereupon terminate;
(C) All Stock Options and SARs held by a Participant or the
Participants permitted transferees, if any, immediately
prior to the Participants death or total and permanent
disability (as determined by the Administrator in its sole
discretion), to the extent then exercisable, will remain
exercisable for the lesser of (i) the one year period
ending with the first anniversary of the Participants
death or the date on which the Participant becomes so disabled
or (ii) the period ending on the latest date on which such
Stock Option or SAR could have been exercised without regard to
this Section 6(a)(4), and will thereupon terminate;
(D) All Stock Options and SARs held by a Participant or the
Participants permitted transferees, if any, immediately
prior to the Participants Retirement, to the extent then
exercisable will remain exercisable for the lesser of (i) a
period of two years or (ii) the period ending on the latest
date on which such Stock Option could have been exercised
without regard to this Section 6(a)(4), and will thereupon
terminate; provided that all Stock Options and SARs will
terminate immediately in the event the Board determines that the
Participant is (i) not in compliance with any
non-competition or non-solicitation or non-disclosure agreement
with the Company, or (ii) if no such agreement exists,
engages in Competitive Activity, within twelve (12) months
following the Participants Retirement in violation of a
Participants Award agreement; and
(E) All Stock Options and SARs held by a Participant or the
Participants permitted transferees, if any, immediately
prior to the cessation of the Participants Employment will
immediately terminate upon such cessation if the Administrator
in its sole discretion determines that such cessation of
Employment is for Cause.
(5) Competitive Activity. The
Administrator may cancel, rescind, withhold or otherwise limit
or restrict any Award at any time if the Participant is not in
compliance with all applicable provisions of the Award agreement
and the Plan, or if the Participant breaches any agreement with
the Company or its Affiliates with respect to non-competition,
non-solicitation or confidentiality.
(6) Taxes. The delivery, vesting
or retention of Stock under an Award is conditioned upon full
satisfaction by the Participant of all tax withholding
requirements with respect to the Award. The Administrator will
make such provision for the withholding and payment of taxes as
it deems necessary. Such taxes shall be remitted to the Company
by cash or check acceptable to the Administrator or by other
means acceptable to the Administrator. In particular, but not in
limitation of the foregoing, the Administrator may, but need
not, hold back shares of Stock from an Award or permit a
Participant to tender previously owned shares of Stock in
satisfaction of tax withholding requirements (but not in excess
of the minimum withholding required by law).
(7) Dividend Equivalents, Etc. The
Administrator may in its sole discretion provide for the payment
of amounts in lieu of cash dividends or other cash distributions
with respect to Stock subject to an Award whether or not the
holder of such Award is otherwise entitled to share in the
actual dividend or distribution in respect of such Award. Any
payment of dividend equivalents or similar payments shall be
established and administered consistent either with exemption
from, or in compliance with, the requirements of
Section 409A. In addition, any amounts payable in respect
of Restricted Stock or Restricted Stock Units may be subject to
such limits or restrictions as the Administrator may impose.
(8) Rights Limited. Nothing in the
Plan will be construed as giving any person the right to
continued employment or service with the Company or its
Affiliates, or any rights as a stockholder except as to shares
of Stock actually issued under the Plan. The loss of existing or
potential profit in Awards will not constitute an element of
damages in the event of termination of Employment for any
reason, even if the termination is in violation of an obligation
of the Company or any Affiliate to the Participant.
(9) Section 162(m). This
Section 6(a)(9) applies to any Performance Award intended
to qualify as performance-based for the purposes of
Section 162(m) other than a Stock Option or SAR. In the
case of any Performance Award to which this Section 6(a)(9)
applies, the Plan and
such Award will be construed to the maximum extent permitted by
law in a manner consistent with qualifying the Award for such
exception. With respect to such Performance Awards, the
Administrator will pre-establish, in writing, one or more
specific Performance Criteria no later than 90 days after
the commencement of the period of service to which the
performance relates (or at such earlier time as is required to
qualify the Award as performance-based under
Section 162(m)). Prior to grant, vesting or payment of the
Performance Award, as the case may be, the Administrator will
certify whether the applicable Performance Criteria have been
attained and such determination will be final and conclusive. No
Performance Award to which this Section 6(a)(9) applies may
be granted after the first meeting of the stockholders of the
Company held in 2015 until the listed performance measures set
forth in the definition of Performance Criteria (as
originally approved or as subsequently amended) have been
resubmitted to and reapproved by the stockholders of the Company
in accordance with the requirements of Section 162(m) of
the Code, unless such grant is made contingent upon such
approval.
(10) Coordination with Other
Plans. Awards under the Plan may be granted
in tandem with, or in satisfaction of or substitution for, other
awards made under other compensatory plans or programs of the
Company or its Affiliates. For example, but without limiting the
generality of the foregoing, awards under other compensatory
plans or programs of the Company or its Affiliates may be
settled in Stock (including, without limitation, Unrestricted
Stock) if the Administrator so determines, in which case the
shares delivered shall be treated as awarded under the Plan (and
shall reduce the number of shares thereafter available under the
Plan in accordance with the rules set forth in Section 4).
In any case where an award is made under another plan or program
of the Company or its Affiliates and such award is intended to
qualify for the performance-based compensation exception under
Section 162(m), and such award is settled by the delivery
of Stock or another Award under the Plan, the applicable
Section 162(m) limitations under both the other plan or
program and under the Plan shall be applied to the Plan as
necessary (as determined by the Administrator) to preserve the
availability of the Section 162(m) performance-based
compensation exception with respect thereto.
(11) Section 409A. Each Award
shall contain such terms as the Administrator determines, and
shall be construed and administered, such that the Award either
(i) qualifies for an exemption from the requirements of
Section 409A to the extent applicable, or
(ii) satisfies such requirements.
(12) Certain Requirements of Corporate
Law. Awards shall be granted and administered
consistent with the requirements of applicable Delaware law
relating to the issuance of stock and the consideration to be
received therefor, and with the applicable requirements of the
stock exchanges or other trading systems on which the Stock is
listed or entered for trading, in each case as determined by the
Administrator.
(b) Awards Requiring Exercise.
(1) Time And Manner Of
Exercise. Unless the Administrator expressly
provides otherwise, an Award requiring exercise will not be
deemed to have been exercised until the Administrator receives a
notice of exercise (in form acceptable to the Administrator),
which may be an electronic notice, signed (including electronic
signature in form acceptable to the Administrator) by the
appropriate person and accompanied by any payment required under
the Award. If the Award is exercised by any person other than
the Participant, the Administrator may require satisfactory
evidence that the person exercising the Award has the right to
do so.
(2) Exercise Price. The exercise
price (or the base value from which appreciation is to be
measured) of each Award requiring exercise shall be 100% (in the
case of an ISO granted to a ten-percent shareholder within the
meaning of subsection (b)(6) of Section 422, 110%) of the
fair market value of the Stock subject to the Award, determined
as of the date of grant, or such other amount as the
Administrator may determine in connection with the grant. No
such Award, once granted, may be repriced other than in
accordance with the terms of Section 9 below and
stockholder approval requirements of the New York Stock
Exchange, as applicable. Fair market value shall be determined
by the Administrator consistent with the applicable requirements
of Section 422 and Section 409A.
(3) Payment Of Exercise
Price. Where the exercise of an Award is to
be accompanied by payment, payment of the exercise price shall
be by cash or check acceptable to the Administrator, or, if so
permitted by the Administrator and if legally permissible,
(i) through the delivery of unrestricted shares of Stock
that have been outstanding for at least six months (unless the
Administrator approves a shorter period) and that have a fair
market value equal to the exercise price, (ii) through a
broker-assisted exercise program acceptable to the
Administrator, (iii) through the withholding of shares of
Stock otherwise to be delivered upon exercise of the Award whose
Fair Market Value is equal to the aggregate exercise price of
the Award being exercised, (iv) by other means acceptable
to the Administrator, or (v) by any combination of the
foregoing permissible forms of payment. No Award requiring
exercise or portion thereof may be exercised unless, at the time
of exercise, the fair market value of the shares of Stock
subject to such Award or portion thereof exceeds the exercise
price for the Award or such portion. The delivery of shares in
payment of the exercise price under clause (i) above may be
accomplished either by actual delivery or by constructive
delivery through attestation of ownership, subject to such rules
as the Administrator may prescribe.
(4) Maximum Term. Awards requiring
exercise will have a maximum term not to exceed ten
(10) years from the date of grant (five (5) years from
the date of grant in the case of an ISO granted to a ten-percent
shareholder within the meaning of subsection (b)(6) of
Section 422) from the date of grant.
7. EFFECT OF CERTAIN TRANSACTIONS
(a) Mergers, etc. Except as
otherwise provided in an Award, the Administrator shall, in its
sole discretion, determine the effect of a Covered Transaction
on Awards, which determination may include, but is not limited
to, taking the following actions:
(1) Assumption or Substitution. If
the Covered Transaction is one in which there is an acquiring or
surviving entity, the Administrator may provide for the
assumption or continuation of some or all outstanding Awards or
for the grant of new awards in substitution therefor by the
acquiror or survivor or an affiliate of the acquiror or survivor.
(2) Cash-Out of Awards. If the
Covered Transaction is one in which holders of Stock will
receive upon consummation a payment (whether cash, non-cash or a
combination of the foregoing), then subject to
Section 7(a)(5) below the Administrator may provide for
payment (a cash-out), with respect to some or all
Awards or any portion thereof, equal in the case of each
affected Award or portion thereof to the excess, if any, of
(A) the fair market value of one share of Stock times the
number of shares of Stock subject to the Award or such portion,
over (B) the aggregate exercise or purchase price, if any,
under the Award or such portion (in the case of an SAR, the
aggregate base value above which appreciation is measured), in
each case on such payment terms (which need not be the same as
the terms of payment to holders of Stock) and other terms, and
subject to such conditions, as the Administrator determines;
provided, that the Administrator shall not exercise its
discretion under this Section 7(a)(2) with respect to an
Award or portion thereof providing for nonqualified
deferred compensation subject to Section 409A in a
manner that would constitute an extension or acceleration of, or
other change in, payment terms if such change would be
inconsistent with the applicable requirements of
Section 409A.
(3) Acceleration of Certain
Awards. If the Covered Transaction (whether
or not there is an acquiring or surviving entity) is one in
which there is no assumption, substitution or cash-out, then
subject to Section 7(a)(5) below the Administrator may
provide that each Award will become fully exercisable and the
delivery of any shares of Stock remaining deliverable under each
outstanding Award of Stock Units (including Restricted Stock
Units and Performance Awards to the extent consisting of Stock
Units) will be accelerated and such shares will be delivered,
prior to the Covered Transaction, in each case on a basis that
gives the holder of the Award a reasonable opportunity, as
determined by the Administrator, following exercise of the Award
or the delivery of the shares, as the case may be, to
participate as a stockholder in the Covered Transaction;
provided, that to the extent acceleration pursuant to this
Section 7(a)(3) of an Award subject to Section 409A
would cause the Award to fail to satisfy the requirements of
Section 409A, the
Award shall not be accelerated and the Administrator in lieu
thereof shall take such steps as are necessary to ensure that
payment of the Award is made in a medium other than Stock and on
terms that as nearly as possible, but taking into account
adjustments required or permitted by this Section 7,
replicate the prior terms of the Award.
(4) Termination of Awards Upon Consummation of
Covered Transaction. Each Award will
terminate upon consummation of the Covered Transaction, other
than the following: (i) Awards assumed pursuant to
Section 7(a)(1) above; (ii) Awards converted pursuant
to the proviso in Section 7(a)(3) above into an ongoing
right to receive payment other than Stock, and
(iii) outstanding shares of Restricted Stock (which will be
treated in the same manner as other shares of Stock, subject to
Section 7(a)(5) below).
(5) Additional Limitations. Any
share of Stock and any cash or other property delivered pursuant
to Section 7(a)(2) or Section 7(a)(3) above with
respect to an Award may, in the discretion of the Administrator,
contain such restrictions, if any, as the Administrator deems
appropriate to reflect any performance or other vesting
conditions to which the Award was subject and that did not lapse
(and were not satisfied) in connection with the Covered
Transaction. For purposes of the immediately preceding sentence,
a cash-out under Section 7(a)(2) above or the acceleration
of exercisability of an Award under Section 7(a)(3) above
shall not, in and of itself, be treated as the lapsing (or
satisfaction) of a performance or other vesting condition. In
the case of Restricted Stock that does not vest in connection
with the Covered Transaction, the Administrator may require that
any amounts delivered, exchanged or otherwise paid in respect of
such Stock in connection with the Covered Transaction be placed
in escrow or otherwise made subject to such restrictions as the
Administrator deems appropriate to carry out the intent of the
Plan.
(b) Changes in and Distributions With Respect to
Stock
(1) Basic Adjustment
Provisions. In the event of a stock dividend,
stock split or combination of shares (including a reverse stock
split), recapitalization or other change in the Companys
capital structure, the Administrator shall make appropriate
adjustments to the maximum number of shares specified in
Section 4(a) that may be delivered under the Plan and to
maximum share limits described in Section 4(d), and will
also make appropriate adjustments to the number and kind of
shares of stock or securities subject to Awards then outstanding
or subsequently granted, any exercise prices relating to Awards
and any other provision of Awards affected by such change.
(2) Certain Other Adjustments. The
Administrator may also make adjustments of the type described in
Section 7(b)(1) above to take into account distributions to
stockholders other than those provided for in Section 7(a)
and 7(b)(1), or any other event, if the Administrator determines
that adjustments are appropriate to avoid distortion in the
operation of the Plan and to preserve the value of Awards made
hereunder, having due regard for the qualification of ISOs under
Section 422 and the requirements of Section 409A and
for the performance-based compensation rules of
Section 162(m), where applicable.
(3) Continuing Application of Plan
Terms. References in the Plan to shares of
Stock will be construed to include any stock or securities
resulting from an adjustment pursuant to this Section 7.
8. LEGAL CONDITIONS ON DELIVERY OF STOCK
The Company will use commercially reasonable efforts to satisfy
applicable legal requirements for the issuance of shares of
Stock pursuant to the exercise of any Award. The Company will
not be obligated to deliver any shares of Stock pursuant to the
Plan or to remove any restriction from shares of Stock
previously delivered under the Plan until: (i) the Company
is satisfied that all legal matters in connection with the
issuance and delivery of such shares have been addressed and
resolved; (ii) if the outstanding Stock is at the time of
delivery listed on any stock exchange or national market system,
the shares to be delivered have been listed or authorized to be
listed on such exchange or system upon official notice of
issuance; and (iii) all conditions of the Award have been
satisfied or waived. If the sale of Stock has not been
registered under the Securities Act of 1933, as amended,
the Company may require, as a condition to exercise of the
Award, such representations or agreements as counsel for the
Company may consider appropriate to avoid violation of such Act.
The Company may require that certificates evidencing Stock
issued under the Plan bear an appropriate legend reflecting any
restriction on transfer applicable to such Stock, and the
Company may hold the certificates pending lapse of the
applicable restrictions.
9. AMENDMENT AND TERMINATION
The Administrator may at any time or times amend the Plan or any
outstanding Award for any purpose which may at the time be
permitted by law, and may at any time terminate the Plan as to
any future grants of Awards; provided, that except as
otherwise expressly provided in the Plan the Administrator may
not, without the Participants consent, alter the terms of
a Award so as to affect materially and adversely the
Participants rights under the Award, unless the
Administrator expressly reserved the right to do so at the time
the Award was granted. In furtherance of the foregoing, the
Administrator may, without stockholder approval, amend any
outstanding Award requiring exercise to provide an exercise
price (or base value, in the case of an SAR) per share that is
lower than the then-current exercise price (or base value) per
share of such outstanding Award (but not lower than the exercise
price or base value at which a new Award of the same type could
be granted on the date of such amendment). The Board may also,
without stockholder approval, cancel any outstanding award
(whether or not granted under the Plan) and grant in
substitution therefor new Awards under the Plan covering the
same or a different number of shares of Common Stock, including,
in the case of an Award requiring exercise, a new Award having
an exercise price (or base value, in the case of an SAR) per
share lower than the then-current exercise price (or base value,
in the case of an SAR) per share of the cancelled award, subject
to the requirements of Section 6(b)(2) above. Any
amendments to the Plan shall be conditioned upon stockholder
approval only to the extent, if any, such approval is required
by law (including the Code and applicable stock exchange
requirements), as determined by the Administrator.
10. OTHER COMPENSATION ARRANGEMENTS
The existence of the Plan or the grant of any Award will not in
any way affect the Companys right to award a person
bonuses or other compensation in addition to Awards under the
Plan.
11. MISCELLANEOUS
(a) Waiver of Jury Trial. By
accepting an Award under the Plan, each Participant waives any
right to a trial by jury in any action, proceeding or
counterclaim concerning any rights under the Plan and any Award,
or under any amendment, waiver, consent, instrument, document or
other agreement delivered or which in the future may be
delivered in connection therewith, and agrees that any such
action, proceedings or counterclaim shall be tried before a
court and not before a jury. By accepting an Award under the
Plan, each Participant certifies that no officer,
representative, or attorney of the Company has represented,
expressly or otherwise, that the Company would not, in the event
of any action, proceeding or counterclaim, seek to enforce the
foregoing waivers.
(b) Limitation of
Liability. Notwithstanding anything to the
contrary in the Plan, neither the Company, nor any Affiliate,
nor the Administrator, nor any person acting on behalf of the
Company, any Affiliate, or the Administrator, shall be liable to
any Participant or to the estate or beneficiary of any
Participant or to any other holder of an Award by reason of any
acceleration of income, or any additional tax (including any
interest and penalties), asserted by reason of the failure of an
Award to satisfy the requirements of Section 422 or
Section 409A or by reason of Section 4999 of the Code,
or otherwise asserted with respect to the Award; provided, that
nothing in this Section 11(b) shall limit the ability of
the Administrator or the Company, in its discretion, to provide
by separate express written agreement with a Participant for a
gross-up
payment or other payment in connection with any such
acceleration of income or additional tax.
(c) Rule 16b-3. During
any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, it is the
intent of the Company that Awards pursuant to the Plan and the
exercise of any Awards granted hereunder that would otherwise be
subject to Section 16(b) of the Exchange Act will qualify
for exemption provided by
Rule 16b-3
under the
Exchange Act. To the extent that any provision of the Plan or
action by the Administrator does not comply with the
requirements of
Rule 16b-3,
it shall be deemed inoperative with respect to such Awards to
the extent permitted by law and deemed advisable by the
Administrator, and shall not affect the validity of the Plan. In
the event that
Rule 16b-3
is revised or replaced, the Administrator may exercise its
discretion to modify this Plan in any respect necessary to
satisfy the requirements of, or to take advantage of any
features of, the revised exemption or its replacement.
12. ESTABLISHMENT OF
SUB-PLANS
The Board may from time to time establish one or more
sub-plans
under the Plan for purposes of satisfying applicable blue sky,
securities or tax laws of various jurisdictions. The Board shall
establish such
sub-plans by
adopting supplements to the Plan setting forth (i) such
limitations on the Administrators discretion under the
Plan as the Board deems necessary or desirable and
(ii) such additional terms and conditions not otherwise
inconsistent with the Plan as the Board shall deem necessary or
desirable. All supplements adopted by the Board shall be deemed
to be part of the Plan, but each supplement shall apply only to
Participants within the affected jurisdiction and the Company
shall not be required to provide copies of any supplement to
Participants in any jurisdiction that is not affected.
13. GOVERNING LAW
Except as otherwise provided by the express terms of an Award
agreement or under a
sub-plan
described in Section 12, the provisions of the Plan and of
Awards under the Plan and all claims or disputes arising out of
our based upon the Plan or any Award under the Plan or relating
to the subject matter hereof or thereof will be governed by and
construed in accordance with the domestic substantive laws of
the State of Delaware without giving effect to any choice or
conflict of laws provision or rule that would cause the
application of the domestic substantive laws of any other
jurisdiction.
EXHIBIT A
Definition of
Terms
The following terms, when used in the Plan, will have the
meanings and be subject to the provisions set forth below:
Administrator: The Compensation
Committee, except that the Compensation Committee may delegate
(i) to one or more of its members (or one or more other
members of the Board) such of its duties, powers and
responsibilities as it may determine; (ii) to one or more
officers of the Company the power to grant rights or options to
the extent permitted by Section 157(c) of the Delaware
General Corporation Law; and (iii) to such Employees or
other persons as it determines such ministerial tasks as it
deems appropriate. In the event of any delegation described in
the preceding sentence, the term Administrator shall
include the person or persons so delegated to the extent of such
delegation.
Affiliate: Any corporation or
other entity that stands in a relationship to the Company that
would result in the Company and such corporation or other entity
being treated as one employer under Section 414(b) and
Section 414(c) of the Code, except that in determining
eligibility for the grant of an Award by reason of service for
an Affiliate, Sections 414(b) and 414(c) of the Code shall
be applied by substituting at least 50% for at
least 80% under Section 1563(a)(1), (2) and
(3) of the Code and Treas. Regs. § 1.414(c)-2;
provided, that to the extent permitted under
Section 409A, at least 20% shall be used in
lieu of at least 50%; and further provided,
that the lower ownership threshold described in this definition
(50% or 20% as the case may be) shall apply only if the same
definition of affiliation is used consistently with respect to
all compensatory stock options or stock awards (whether under
the Plan or another plan). The Company may at any time by
amendment provide that different ownership thresholds
(consistent with Section 409A) apply but any such change
shall not be effective for twelve (12) months.
Award: Any or a combination of the
following:
(i) Stock Options.
(ii) SARs.
(iii) Restricted Stock
(iv) Unrestricted Stock.
(v) Stock Units, including Restricted Stock Units.
(vi) Performance Awards.
(vii) Cash Awards.
(viii) Awards (other than Awards described in
(i) through (vi) above) that are convertible into or
otherwise based on Stock.
Board: The Board of Directors of
the Company.
Cash Award: An Award denominated
in cash.
Cause: In the case of any
Participant, unless a defined term cause is set
forth in a Participants Award or employment agreement in
which case such definition shall govern, a termination by the
Company or an affiliate of the Participants Employment or
a termination by the Participant of the Participants
Employment, in either case following the occurrence of any of
the following events: (i) the Participants willful
and continued failure to perform, or gross negligence or willful
misconduct in the performance of, his or her material duties
with respect to the Company or an Affiliate which, if curable,
continues beyond ten business days after a written demand for
substantial performance is delivered to the Participant by the
Company; or (ii) Participants conviction of, or a
plea of nolo contendere to, a crime constituting a felony under
the laws of the United States or any state thereof;
(iii) the Participants committing or engaging in any
act of fraud, embezzlement, theft or other act of dishonesty
against the Company or its subsidiaries that causes material
injury, monetarily or otherwise, to the Company or an Affiliate;
or (iv) the Participants breach of his or her
noncompetition
or nonsolicitation obligations in any agreement with the Company
that causes material injury, monetarily or otherwise, to the
Company or an Affiliate.
Code: The U.S. Internal
Revenue Code of 1986 as from time to time amended and in effect,
or any successor statute as from time to time in effect.
Company: LPL Investment Holdings
Inc.
Compensation Committee: The
Compensation and Human Resources Committee of the Board.
Competitive Activity: engaging,
directly or indirectly, alone or as principal, agent, employee,
employer, consultant, investor, partner or manager, or providing
advisory or other services to, or owning any stock or any other
ownership interest in, or making any financial investment in any
business (or entity) that engages in any business in which the
Company and its subsidiaries are engaged, or that provides any
material products
and/or
services that the Company or its subsidiaries were actively
developing or designing (provided that where such Competitive
Activity occurs following termination of Employment, the
Competitive Activity shall be determined at the date of
termination); provided, that the foregoing shall not restrict
the Participant from owning less than two percent (2%) of the
outstanding securities of any class of securities listed on a
national exchange or inter-dealer quotation system.
Covered Transaction: Any of
(i) a consolidation, merger, or similar transaction or
series of related transactions, including a sale or other
disposition of stock, in which the Company is not the surviving
corporation or which results in the acquisition of all or
substantially all of the Companys then outstanding common
stock by a single person or entity or by a group of persons
and/or
entities acting in concert, in each case by other than an
Affiliate (ii) a sale or transfer of all or substantially all
the Companys assets, or (iii) a dissolution or
liquidation of the Company. Where a Covered Transaction involves
a tender offer that is reasonably expected to be followed by a
merger described in clause (i) (as determined by the
Administrator), the Covered Transaction will be deemed to have
occurred upon consummation of the tender offer.
Effective Date: The date on which
the initial public offering of LPL becomes effective within the
meaning of the Securities Act of 1933.
Employee: Any person who is
employed by the Company or an Affiliate.
Employment: A Participants
employment or other service relationship with the Company and
its Affiliates. Employment will be deemed to continue, unless
the Administrator expressly provides otherwise, so long as the
Participant is employed by, or otherwise is providing services
in a capacity described in Section 5 to the Company or its
Affiliates. If a Participants employment or other service
relationship is with an Affiliate and that entity ceases to be
an Affiliate, the Participants Employment will be deemed
to have terminated when the entity ceases to be an Affiliate
unless the Participant transfers Employment to the Company or
its remaining Affiliates. Notwithstanding the foregoing, in
construing the provisions of any Award relating to the payment
of nonqualified deferred compensation (subject to
Section 409A) upon a termination or cessation of
Employment, references to termination or cessation of
employment, separation from service, retirement or similar or
correlative terms shall be construed to require a
separation from service (as that term is defined in
Section 1.409A-1(h)
of the Treasury Regulations) from the Company and from all other
corporations and trades or businesses, if any, that would be
treated as a single service recipient with the
Company under
Section 1.409A-1(h)(3)
of the Treasury Regulations. The Company may, but need not,
elect in writing, subject to the applicable limitations under
Section 409A, any of the special elective rules prescribed
in
Section 1.409A-1(h)
of the Treasury Regulations for purposes of determining whether
a separation from service has occurred. Any such
written election shall be deemed a part of the Plan.
Exchange Act: The Securities
Exchange Act of 1934, as from time to time amended and in
effect, or any successor statute as from time to time in effect.
Existing Plans: LPL Investment
Holdings Inc. 2005 Stock Option Plan for Non-Qualified Stock
Options; LPL Investment Holdings Inc. 2005 Stock Option Plan for
Incentive Stock Options; LPL
Investment Holdings Inc. 2008 Stock Option Plan; and LPL
Investment Holdings Inc. Advisor Incentive Plan.
ISO: A Stock Option intended to be
an incentive stock option within the meaning of
Section 422. Each option granted pursuant to the Plan will
be treated as providing by its terms that it is to be a
non-incentive stock option unless, as of the date of grant, it
is expressly designated as an ISO.
Participant: A person who is
granted an Award under the Plan.
Performance Award: An Award
subject to Performance Criteria. The Compensation Committee in
its discretion may grant Performance Awards that are intended to
qualify for the performance-based compensation exception under
Section 162(m) and Performance Awards that are not intended
so to qualify.
Performance Criteria: Specified
criteria, other than the mere continuation of Employment or the
mere passage of time, the satisfaction of which is a condition
for the grant, exercisability, vesting or full enjoyment of an
Award. For purposes of Awards that are intended to qualify for
the performance-based compensation exception under
Section 162(m), a Performance Criterion will mean an
objectively determinable measure of performance relating to any
or any combination of the following (measured either absolutely
or by reference to an index or indices and determined either on
a consolidated basis or, as the context permits, on a
divisional, subsidiary, line of business, project or
geographical basis or in combinations thereof): sales; revenues;
assets; expenses; earnings before or after deduction for all or
any portion of interest, taxes, depreciation, or amortization,
whether or not on a continuing operations or an aggregate or per
share basis; return on equity, investment, capital or assets;
one or more operating ratios; borrowing levels, leverage ratios
or credit rating; market share; capital expenditures; cash flow;
stock price; stockholder return; sales of particular products or
services; customer acquisition or retention; acquisitions and
divestitures (in whole or in part); joint ventures and strategic
alliances; spin-offs,
split-ups
and the like; reorganizations; or recapitalizations,
restructurings, financings (issuance of debt or equity) or
refinancings. A Performance Criterion and any targets with
respect thereto determined by the Administrator need not be
based upon an increase, a positive or improved result or
avoidance of loss. To the extent consistent with the
requirements for satisfying the performance-based compensation
exception under Section 162(m), the Administrator may
provide in the case of any Award intended to qualify for such
exception that one or more of the Performance Criteria
applicable to such Award will be adjusted in an objectively
determinable manner to reflect events (for example, but without
limitation, acquisitions or dispositions) occurring during the
performance period that affect the applicable Performance
Criterion or Criteria.
Plan: The LPL Investment Holdings
Inc. 2010 Omnibus Equity Incentive Plan as from time to time
amended and in effect.
Restricted Stock: Stock subject to
restrictions requiring that it be redelivered or offered for
sale to the Company if specified conditions are not satisfied.
Restricted Stock Unit: A Stock
Unit that is, or as to which the delivery of Stock or cash in
lieu of Stock is, subject to the satisfaction of specified
performance or other vesting conditions.
Retirement: Termination of
Employment other than for Cause following attainment of
age 65 and completion of five (5) years of continuous
service with the Company.
SAR: A right entitling the holder
upon exercise to receive an amount (payable in cash or in shares
of Stock of equivalent value) equal to the excess of the fair
market value of the shares of Stock subject to the right over
the base value from which appreciation under the SAR is to be
measured.
Section 162(m): Section 162(m)
of the Code.
Section 409A: Section 409A
of the Code.
Section 422: Section 422
of the Code.
Stock: Common Stock of the
Company, par value $0.001 per share.
Stock Option: An option entitling
the holder to acquire shares of Stock upon payment of the
exercise price.
Stock Unit: An unfunded and
unsecured promise, denominated in shares of Stock, to deliver
Stock or cash measured by the value of Stock in the future.
Unrestricted Stock: Stock not
subject to any restrictions under the terms of the Award.