Attached files
| file | filename |
|---|---|
| 10-Q - FORM 10-Q - CBL & ASSOCIATES PROPERTIES INC | form10q.htm |
| EX-32.1 - EXHIBIT 32.1 - CBL & ASSOCIATES PROPERTIES INC | exhibit321.htm |
| EX-32.2 - EXHIBIT 32.2 - CBL & ASSOCIATES PROPERTIES INC | exhibit322.htm |
| EX-31.1 - EXHIBIT 31.1 - CBL & ASSOCIATES PROPERTIES INC | exhibit311.htm |
| EX-31.2 - EXHIBIT 31.2 - CBL & ASSOCIATES PROPERTIES INC | exhibit312.htm |
| EX-12.1 - EXHIBIT 12.1 - CBL & ASSOCIATES PROPERTIES INC | exhibit121.htm |
| EX-10.15.3 - EXHIBIT 10.15.3 - CBL & ASSOCIATES PROPERTIES INC | exhibit10153.htm |
SECOND
AMENDED AND RESTATED
CBL
& ASSOCIATES PROPERTIES, INC.
STOCK
INCENTIVE PLAN
SECOND
AMENDED AND RESTATED
CBL
& ASSOCIATES PROPERTIES, INC.
STOCK
INCENTIVE PLAN
WHEREAS, the CBL &
Associates Properties, Inc. 1993 Stock Incentive Plan was adopted by the Company
on October 27, 1993 (the “Initial
Plan”);
WHEREAS, the Initial Plan has
been amended by Amendment No. 1 on May 1, 1996, Amendment No. 2 on May 3, 2000
and by Amendment No. 3 on May 7, 2002;
WHEREAS, the Initial Plan, as
amended, was scheduled to terminate on October 27, 2003;
WHEREAS, the Awards granted
under the Initial Plan, as amended, and the status of the Initial Plan, as
amended, were as follows as of March 10, 2003 (the record date for stockholders
voting on the adoption of the Amended and Restated Plan, as defined below, and
prior to the antidilution adjustment made to reflect the 6/15/05 Stock Split, as
defined below):
Stock Awards (fully vested on grant or
fully vested as of March 10,
2003) 301,336
Deferred Stock Awards (subject to
vesting/issuance
following
March 10,
2003)
205,534
Outstanding
Employee Stock Options (vested and non-vested unexercised
stock
options granted to employees prior to March 10,
2003) 2,510,377
Non-Employee
Directors
Shares
3,000
Outstanding
Non-Employee Directors Stock
Options 20,000
Shares
Available For
Awards
1,109,461
WHEREAS, pursuant to the
recommendation of the Corporation’s Board of Directors, the Corporation’s
shareholders adopted the Amended and Restated CBL & Associates Properties,
Inc. Stock Incentive Plan on May 5, 2003 (the “Amended and Restated
Plan”); and
WHEREAS, pursuant to the
recommendation of the Compensation Committee of the Corporation’s Board of
Directors, the Board of Directors adopted that certain Amendment #1 to the
Amended and Restated Plan on October 29, 2003, which authorized the granting of
up to 100 shares of restricted Common Stock to the Non-Employee Directors of the
Corporation in lieu of annual grants of stock options; and
WHEREAS, pursuant to the
recommendation of the Compensation Committee of the Corporation’s Board of
Directors, the Board of Directors adopted that certain Amendment #2 to the
Amended and Restated Plan on November 4, 2004, which increased the number of
shares of restricted Common Stock that may be granted to the Non-Employee
Directors of the Corporation in lieu of stock options; and
WHEREAS, effective as of June
15, 2005, acting pursuant to Section 3(b) of the Amended and Restated Plan in
conjunction with a two-for-one stock split of the Company’s
1
Common
Stock, which was effected in the form of a stock dividend as of such date (the
“6/15/05 Stock
Split”), the Compensation Committee determined to make appropriate and
equitable adjustments to the Amended and Restated Plan and to the number of
shares subject to any award and any deferred compensation arrangement
outstanding under the Amended and Restated Plan, and to any vesting schedule and
exercise price applicable to each such outstanding award, as well as to the
total number of shares authorized for issuance under the Amended and Restated
Plan, to reflect the 6/15/05 Stock Split and to preserve the intrinsic value of
each such award and deferred compensation arrangement outstanding at such time;
and
WHEREAS, pursuant to the recommendation of the Compensation Committee of the Corporation’s Board of Directors, the Board of Directors adopted that certain Amendment #3 to the Amended and Restated Plan as of May 4, 2010, which amended the terms of the transfer restrictions imposed on restricted common stock granted to Non-Employee Directors to waive the transfer restrictions in the event of the death or disability of a Non-Employee Director; and
WHEREAS, pursuant to the
recommendation of the Compensation Committee of the Corporation’s Board of
Directors and in conjunction with the adopton of Amendment #3 as described
above, the Board of Directors also approved, effective as of May 4, 2010, a
further restatement of the the Amended and Restated Plan, to be desinated the
Second Amended and Restated CBL & Associates Properties, Inc. Stock
Incentive Plan (the “Second Amended and Restated
Plan”), to create an official version of such plan to be filed as an
exhibit to the Corporation’s periodic reports filed with the SEC that
incorporates and clearly reflects the changes made by Amendment #1, Amendment #2
and Amendment #3 thereto, as well as by the antidilution adjustments effected in
connection with the 6/15/05 Stock Split.
NOW, THEREFORE, pursuant to
the action of the Board of Directors of the Company on May 4, 2010, the Amended
and Restated Plan, as amended by Amendment #1, Amendment #2 and Amendment #3
thereto as described above, as well as by the antidilution adjustments effected
in connection with the 6/15/05 Stock Split, is hereby restated in its entirety
to reflect such changes, on the terms and provisions set forth
below. Notwithstanding the preceding sentence, the terms and
provisions of Pre-Amendment Awards, as defined below, continue in force as such
terms and provisions existed on the date such Pre-Amendment Awards were
made.
Effective Date – as a
restatement of the original Amended and Restated Plan, as amended, the effective
date of this Plan shall remain May 5, 2003, the date the Amended and Restated
Plan was submitted to the Company’s stockholders for vote, as to all
provisions hereof other than the changes previously effected by Amendment #1,
Amendment #2, Amendment #3 and the antidilution adjustments effected in
connection with the 6/15/05 Stock Split, each of which are effective as of their
respective dates of adoption by the Corporation’s Board of Directors or by the
Compensation Committee of the Corporation’s Board of Directors, as
applicable.
Expiration Date – the
expiration date of this Plan, after which no Awards may be granted hereunder,
shall be May 5, 2013; provided, however, that the administration of the Plan
shall continue in effect until all matters relating to the payment of Awards
previously granted have been settled.
2
SECTION
1. Purpose; Definitions.
Purpose. The
purpose of the Plan is to give the Company a significant advantage in
attracting, retaining and motivating officers, employees and directors of the
Company and to provide the Company and is Subsidiaries with the ability to
provide incentives more directly linked to the long term profitability of the
Company’s businesses and increases in stockholder value thereby strengthening
the commitment of the Company’s officers, employees and directors to the welfare
of the Company and promoting an identity of interest between stockholders and
the Company’s officers, employees and directors.
Definitions. For
purposes of the Plan, the following terms are defined as set forth
below:
“Affiliate” means CBL
& Associates Management, Inc., and any other corporation or other entity in
which the Company has a substantial direct or indirect ownership interest, and
designated by the Compensation Committee as such.
“Award” means
awards/grants of Stock Option(s), unrestricted Stock, Restricted Stock,
Non-Employee Director Share(s), Non-Employee Director Stock Option(s) and/or any
other stock based awards described in Section 7 below that
is made pursuant to the terms of this Plan.
“Board” means the
Board of Directors of the Company.
“Cause” has the
meaning set forth in Section 5(a)(ix)
below.
“Change in Control”
shall mean the happening of any of the following events:
(i) An
acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either (A) the then outstanding shares of common
Stock of the Company (the “Outstanding Common
Stock”) or (B) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Voting
Securities”); excluding, however, the following: (I) any acquisition
directly from the Company, other than an acquisition by virtue of the exercise
of a conversion privilege unless the security being so converted was itself
acquired directly from the Company, (II) any acquisition by the Company, or
members of the Company’s management, or any combination thereof, (III) any
acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (IV)
any acquisition by any Person pursuant to a transaction which complies with
clauses (A), (B) and (C) of subsection (iii) of
this definition; or
(ii) A
change in the composition of the Board such that the individuals who, as of the
effective date of the Plan, constitute the Board (such Board shall be
hereinafter referred to as the “Incumbent Board”)
cease for any reason to constitute at least a majority of the Board; provided,
however, for the purposes of this definition, that any individual who becomes
a
3
(iii) The
approval by the stockholders of the Company of a Corporate Event as defined in
Section 8(a)
below; excluding, however, such a Corporate Event pursuant to which
(A) all
or substantially all of the individuals and entities who are the beneficial
owners, respectively, of the Outstanding Common Stock and Outstanding Voting
Securities immediately prior to such Corporate Event will beneficially own,
directly or indirectly, more than 60% of, respectively, the outstanding shares
of common stock, and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Corporate Event (including,
without limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company’s assets either directly or
through one or more Subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Corporate Event, of the Outstanding Common
Stock and Outstanding Voting Securities, as the case may be;
(B) no
Person (other than the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the
Company or such corporation resulting from such Corporate Event) will
beneficially own, directly or indirectly, 20% or more of,
respectively, the outstanding shares of common stock of the corporation
resulting from such Corporate Event or the combined voting power of the
outstanding voting securities of such corporation entitled to vote generally in
the election of directors except to the extent that such ownership existed with
respect to the Company prior to the Corporate Event; and
(C)
individuals who were members of the Incumbent Board will constitute at least a
majority of the members of the board of directors of the corporation resulting
from such Corporate Event; or
(iv) The
approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.
“Code” means the
Internal Revenue Code of 1986, as amended from time to time, and any successor
thereto.
“Commission” means the
Securities and Exchange Commission or any successor agency.
4
“Common Stock” means
common stock, par value $0.01 per share, of the Company.
“Company” means CBL
& Associates Properties, Inc., Delaware corporation.
“Compensation
Committee” means the Compensation Committee referred to in Section 2
below.
“Corporate Event”
shall have the meaning ascribed to that term in Section 8(a)
below.
“Date of Grant” means
the date on which the granting of an Award is authorized or such other date as
may be set forth in such authorization.
“Disability” means
permanent and total disability as determined under procedures established by the
Compensation Committee for purposes of the Plan.
“Exchange Act” means
the Securities Exchange Act of 1934, as amended from time to time, and any
successor thereto.
“Fair Market Value”
means, as of any given date, the mean between the highest and lowest reported
sales prices of the Common Stock on the New York Stock Exchange or, if not
listed on such exchange, on any other national securities exchange on which the
Common Stock is listed or on NASDAQ. If there is no regular public
trading market for such Common Stock the Fair Market Value of the Common Stock
shall be determined by the Compensation Committee in good faith.
“Incentive Stock
Option” means any Stock Option intended to be and designated as an
“incentive stock option” within the meaning of Section 422 of the
Code.
“Mature Stock” shall
have the meaning ascribed to that term in Section 5(a)(iv)
below.
“Non-Employee Director Share” means
a share of Common Stock granted to Non-Employee Directors as set forth in Section 13
below.
“Non-Employee Director Stock
Option” means a Stock Option granted to Non-Employee Directors as set
forth in Section
13 below.
“Non-Qualified Stock
Option” means any Stock Option that is not an Incentive Stock
Option.
“Participant” shall
mean any recipient of an Award under this Plan.
5
“Plan” means the
Amended and Restated CBL & Associates Properties, Inc. Stock Incentive Plan,
as set forth herein and as hereinafter amended from time to time.
“Pre-Amendment Awards”
means collectively the Deferred Stock Awards set forth in the 4th Whereas clause
above, the Outstanding Employee Stock Options set forth in the 4th Whereas
clause above, the Non-Employee Director Shares set forth in the 4th Whereas
clause above and the Outstanding Non-Employee Director Stock Options set forth
in the 4th Whereas clause above.
“Restricted Stock”
means an Award granted under Section 6
below.
“Retirement” means
retirement from active employment under a pension plan of the Company, any
Subsidiary or Affiliate, or under an employment contract with any of them, or
termination of employment at or after age 65 under circumstances which the
Compensation Committee, in its sole discretion, deems equivalent to
retirement.
“Rule 16b-3” means
Rule 16b-3, as promulgated by the Commission under Section 16(b) of the Exchange
Act, as amended from time to time.
“Stock Award(s)” means
any award of Common Stock of the Company, whether such award is in the form of
Restricted Stock or Stock that is unrestricted.
“Stock Option” or
“Option” means
an option granted under Section 5(a)
below.
“Subsidiary” means a
“subsidiary corporation” within the meaning of Section 424(f) of the
Code.
“Termination of
Employment” means the termination of the Participant’s employment with
the Company or any Subsidiary or Affiliate. A Participant employed by
a Subsidiary or an Affiliate shall also be deemed to incur a Termination of
Employment if the Subsidiary or Affiliate ceases to be such a Subsidiary or
Affiliate, as the case may be, and the Participant does not immediately
thereafter become an employee of the Company or another Subsidiary or
Affiliate.
In
addition, certain other terms used herein have definitions given to them in the
first place in which they are used.
SECTION 2. Administration.
The Plan
shall be administered by the Compensation Committee of the Board as such is
presently situated on the Effective Date and as it shall be constituted after
the Effective Date throughout the term of this Plan (the “Compensation
Committee”). The Compensation Committee is required to be
comprised of Independent Directors, as defined by the Board and/or applicable
law. If at any time no Compensation Committee shall be in office, the
functions of the Compensation Committee specified in the Plan shall be exercised
by the Board or by such
6
Subject
to Section 14
hereof, the Compensation Committee shall have primary authority to grant Awards
pursuant to the terms of the Plan to officers, employees and directors of the
Company and its Subsidiaries and Affiliates.
Among
other things, the Compensation Committee shall have the authority, subject to
the terms of the Plan:
(a) to
select the officers, employees and directors to whom Awards may from time to
time be granted; provided that awards to non-employee directors shall be made
only in accordance with Section 13
below;
(b) to
determine whether and to what extent Incentive Stock Options, Non-Qualified
Stock Options and Restricted Stock or any combination thereof are to be granted
hereunder;
(c) to
determine the number of shares of Common Stock to be covered by each Award
granted hereunder;
(d) to
determine the terms and conditions of any Award granted hereunder (including,
but not limited to, subject to Section 5(a) below,
the option price, any vesting restriction or limitation and any vesting
acceleration or forfeiture waiver regarding any Award and the shares of Common
Stock relating thereto, based on such factors as the Compensation Committee
shall determine);
(e) to
modify, amend or adjust the terms and conditions of any Award, at any time or
from time to time, including, but not limited to, with respect to performance
goals and measurements applicable to performance-based Awards pursuant to the
terms of the Plan;
(f) to
determine to what extent and under what circumstances Common Stock and other
amounts payable with respect to an Award shall be deferred; and
(g) to
determine under what circumstances a Stock Option may be settled in cash or
Common Stock under Section 5(a)(iv)
below.
The
Compensation Committee shall have the authority to adopt, alter and repeal such
administrative rules, guidelines and practices governing the Plan as it shall,
from time to time, deem advisable, to interpret the terms and provisions of the
Plan and any Award issued under the Plan (and any agreement relating thereto)
and to otherwise supervise the administration of the Plan.
7
The
Compensation Committee may act with respect to the Plan only by a majority of
its members then in office, except that the members thereof may authorize any
one or more of their number or any officer of the Company to execute and deliver
documents on behalf of the Compensation Committee.
Any
determination made by the Compensation Committee or pursuant to delegated
authority pursuant to the provisions of the Plan with respect to any Award shall
be made in the sole discretion of the Compensation Committee or such delegate at
the time of the grant of the Award or, unless in contravention of any express
term of the Plan, at any time thereafter. All decisions made by the
Compensation Committee or any appropriately delegated officer pursuant to the
provisions of the Plan shall be final and binding on all persons, including the
Company and Plan Participants subject to Plan provisions, including but not
limited to Section
14 below.
SECTION 3. Common Stock
Subject to Plan.
(a) Number of Shares of Common
Stock Available. Subject to adjustment as
provided herein, the total number of shares of Common Stock available for
distribution pursuant to Awards under the Plan shall be 10,400,000 shares of
Common Stock, and the maximum number of shares of Common Stock with respect to
which Options may be granted to any Plan Participant during any calendar year
shall not exceed 200,000. Shares subject to an Award under the Plan
may be authorized and unissued shares or may be treasury shares.
(b) Adjustments. Awards
granted under the Plan and any agreements evidencing such Awards, the maximum
number of shares of Stock subject to all Awards under the Plan, the number of
shares of Stock subject to outstanding Awards and the maximum number of shares
of Stock with respect to which any one person may be granted Options or stock
appreciation rights during any year may be subject to adjustment or
substitution, as determined by the Company or the Compensation Committee, as to
the number, price or kind of a share of Stock or other consideration subject to
such Awards or as otherwise determined by the Company or the Compensation
Committee to be equitable:
(i) in
the event of changes in the outstanding Stock or in the capital structure of the
Company by reason of stock dividends, stock splits, reverse stock splits,
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges, or other relevant changes in capitalization occurring after the Date
of Grant of any such Award; or
(ii) in
the event of any change in applicable laws or any change in circumstances which
results in or would result in any substantial dilution or enlargement of the
rights granted to, or available for, Participants in the Plan; or
(iii) for
any other reason which the Company or the Compensation Committee determines
otherwise warrants equitable adjustment because it interferes with the intended
operation of the Plan.
8
Any
adjustment to Incentive Stock Options under this Section 3(b) shall
take into account that adjustments which constitute a "modification" within the
meaning of Section 424(h)(3) of the Code may have an adverse tax impact on such
Incentive Stock Options and the Compensation Committee may, in its sole
discretion, provide for a different adjustment or no adjustment in order to
preserve the tax effects of Incentive Stock Options. Unless otherwise
determined by the Company or the Compensation Committee, any adjustments or
substitutions under this Section 3(b) shall be
made in a manner which does not adversely affect the exemption provided pursuant
to Rule 16b-3 under the Exchange Act and any such adjustments or substitutions
shall be subject to the provisions of this Plan including, but not limited to
Section 9 and
Section 14
below. Further, with respect to Awards intended to qualify as
"performance-based compensation" under Section 162(m) of the Code, such
adjustments or substitutions shall, unless otherwise determined by the Company
or the Compensation Committee, be made only to the extent that the Company or
the Compensation Committee determines that such adjustments or substitutions may
be made without a loss of deductibility for such Awards under Section 162(m) of
the Code. The Company shall give each Participant notice of an
adjustment hereunder and, upon notice, such adjustment shall be conclusive and
binding for all purposes.
SECTION
4. Eligibility.
Officers,
employees and directors of the Company, its Subsidiaries and Affiliates who are
responsible for or contribute to the management, growth and profitability of the
business of the Company, its Subsidiaries and Affiliates are eligible to be
granted Awards under the Plan. Except as expressly authorized by
Section 13 of
the Plan, however, no grant shall be made to a director who is not an officer or
a salaried employee of the Company, its Subsidiaries and/or
Affiliates.
SECTION
5. Stock Options; Stock Awards.
(a) Stock
Options. Stock Options may be granted alone
or in addition to other Awards granted under the Plan and may be of two types:
Incentive Stock Options and Non-Qualified Stock Options. Any Stock
Option granted under the Plan shall be in such form as the Compensation
Committee may from time to time approve.
The
Compensation Committee shall have the authority to grant any optionee Incentive
Stock Options, Non-Qualified Stock Options or both types of Stock
Options. Incentive Stock Options may be granted only to employees of
the Company and its Subsidiaries and Affiliates. To the extent that
any Stock Option is not designated as an Incentive Stock Option or even if so
designated does not qualify as an Incentive Stock Option, it shall constitute a
Non-Qualified Stock Option.
Stock
Options shall be evidenced by option agreements, the terms and provisions of
which may differ. An option agreement shall indicate on its face
whether it is intended to be an agreement for an Incentive Stock Option or a
Non-Qualified Stock Option. The grant of a Stock Option shall occur
on the date the Compensation Committee by resolution selects an individual to be
a Participant in any grant of a Stock Option, determines the number of shares of
Stock to be subject to such Stock Option to be granted to such individual and
specifies the terms
9
Anything
in the Plan to the contrary notwithstanding, no term of the Plan relating to
Incentive Stock Options shall be interpreted, amended or altered nor shall any
discretion or authority granted under the Plan be exercised so as to disqualify
the Plan under Section 422 of the Code or, without the consent of the optionee
affected, to disqualify any Incentive Stock Option under such Section 422 of the
Code.
Stock
Options granted under the Plan shall be subject to the following terms and
conditions and shall contain such additional terms and conditions as the
Compensation Committee shall deem desirable:
(i) Option
Price. The option price per share of Common Stock purchasable
under a Stock Option (A) shall be determined by the Compensation Committee and
set forth in the option agreement, (B) shall not be less than the Fair Market
Value of the Common Stock subject to the Stock Option on the Date of Grant and
(C) in the case of an Incentive Stock Option granted to an optionee who owns
stock representing more than 10% of the voting power of all classes of stock of
the Company or any subsidiary of the Company, shall not be less than 110% of the
Fair Market Value of the Common Stock subject to the Incentive Stock Option on
the Date of Grant.
(ii) Option
Term. The term of each Stock Option shall be fixed by the
Compensation Committee, but (A) no Stock Option shall be exercisable more than
10 years after the date the Stock Option is granted and (B) no Incentive Stock
Option granted to an optionee who owns stock representing more than 10% of the
voting power of all classes of stock of the Company or any Subsidiary shall be
exercisable more than five years after the date the Stock Option is
granted.
(iii) Exercisability. Except
as otherwise provided herein, Stock Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by the
Compensation Committee. If the Compensation Committee provides that
any Stock Option is exercisable only in installments, the Compensation Committee
may at any time waive such installment exercise provisions, in whole or in part,
based on such factors as the Compensation Committee may determine. In
addition, the Compensation Committee may at any time, in whole or in part,
accelerate the exercisability of any Stock Option.
Notwithstanding
any other provision hereof, the aggregate Fair Market Value, determined on the
date of award, of Common Stock with respect to which Incentive Stock Options are
exercisable by an optionee for the first time during any calendar year under all
stock option plans of the Company and any Subsidiary of the Company shall not
exceed $100,000.
(iv) Method of
Exercise. Subject to the provisions of this Section 5(a), Stock
Options may be exercised, in whole or in part, at any time during the option
term by giving
10
written
notice of exercise to the Company specifying the number of shares of Common
Stock subject to the Stock Option to be purchased.
The
option price of Common Stock to be purchased upon exercise of any Option shall
be paid in full in cash (by certified or bank check, or such other instrument as
the Company may accept) or, if and to the extent set forth in the option
agreement, may also be paid by one or more
of the following: (A) in the case of the exercise of a Non-Qualified Stock
Option, in the form of unrestricted Common Stock already owned by the optionee
that meets the definition of “Mature Stock”, as defined below, based in any such
instance on the Fair Market Value of the Common Stock on the date the Stock
Option is exercised; provided, however, that, in the case of an Incentive Stock
Option, the right to make a payment in the form of already owned shares of
Common Stock may be authorized only at the time the Stock Option is granted; (B)
by requesting the Company to withhold from the number of shares of Common Stock
otherwise issuable upon exercise of the Stock Option that number of shares
having an aggregate Fair Market Value on the date of exercise equal to the
exercise price for all of the shares of Common Stock subject to such exercise;
or (C) by a combination thereof, in each case in the manner provided in the
option agreement.
As noted
above, the option price may be paid in shares of Common Stock owned by the
optionee upon the exercise of a Stock Option provided the shares of
Common Stock so utilized meet the definition of “Mature Stock”. For
purposes hereof, the term “Mature Stock” shall
mean (I) shares of unrestricted Common Stock that have been owned by the
optionee for at least six (6) consecutive months prior to the date of the
exercise of the Stock Option wherein such shares at to be utilized to
pay all or a portion of the Option Price; or (II) shares of
unrestricted Common Stock that were purchased by the optionee in an open-market
transaction prior to the exercise of the Stock Options wherein such
shares are to be utilized to pay all or a portion of the Option
Price.
In the
discretion of the Compensation Committee and to the extent allowed under
applicable law, payment for any shares subject to a Stock Option may also be
made by delivering a properly executed exercise notice to the Company, together
with a copy of irrevocable instructions to a broker to deliver promptly to the
Company the amount of funds to pay the purchase price.
(v) Transferability of Stock
Options. No Stock Option shall be transferable by the optionee
other than (A) by will or by the laws of descent and distribution or (B)
pursuant to a qualified domestic relations order (as defined in the Code or
Title I of the Employee Retirement Income Security Act of 1974, as amended, or
the rules thereunder) or (C) by a gift to a “family member”, as herein
defined. All Stock Options shall be exercisable, during the
optionee’s lifetime, only by the optionee or by the guardian or legal
representative of the optionee or by an alternate payee pursuant to such
qualified domestic relations order or by the “family member” who is the donee of
a gift, it being understood that the terms “holder” and “optionee” include the
guardian, legal representative or family member donee of the optionee named in
the option agreement and any person to whom an option is transferred by will or
the laws of descent and distribution, pursuant to a qualified domestic relations
order or pursuant to a gift to a “family member”. For purposes of
this Plan, the term “family member” as relates to the
11
(vi) Termination by
Death. If an optionee’s employment terminates by reason of
death, any Stock Option held by such optionee may thereafter be exercised, to
the extent then exercisable, or on such accelerated basis as the Compensation
Committee may determine, for a period of one year (or such other period as the
Compensation Committee may specify in the option agreement) from the date of
such death or until the expiration of the stated term of such Stock Option,
whichever period is the shorter. In the event of termination of
employment due to death, if an Incentive Stock option is exercised after the
expiration of the exercise periods that apply for purposes of Section 422 of the
Code, such Stock Option will thereafter be treated as a Non-Qualified Stock
Option.
(vii) Termination by Reason of
Disability. If an optionee’s employment terminates by reason
of Disability, any Stock Option held by such optionee may thereafter be
exercised by the optionee, to the extent it was exercisable at the time of
termination, or on such accelerated basis as the Compensation Committee may
determine, for a period of three years (or such shorter period as the
Compensation Committee may specify in the option agreement) from the date of
such termination of employment or until the expiration of the stated term of
such Stock Option, whichever period is the shorter; provided, however, that if
the optionee dies within such three-year period (or such shorter period), any
unexercised Stock Option held by such optionee shall, notwithstanding the
expiration of such three-year (or such shorter) period, continue to be
exercisable to the extent to which it was exercisable at the time of death for a
period of one year from the date of such death or until the expiration of the
stated term of such Stock Option, whichever period is the shorter. In
the event of termination of employment by reason of Disability, if an Incentive
Stock Option is exercised after the expiration of the exercise periods that
apply for purposes of Section 422 of the Code, such Stock Option will thereafter
be treated as a Non-Qualified Stock Option.
(viii) Termination by Reason of
Retirement. If an optionee’s employment terminates by reason
of Retirement, any Non-Qualified Stock Option held by such optionee may
thereafter be exercised by the optionee, to the extent it was exercisable at the
time of such Retirement or on such accelerated basis as the Compensation
Committee may determine, for a period of three years (or such shorter period as
the Compensation Committee may specify in the
12
(ix) Other
Termination. Unless otherwise determined by the Compensation
Committee, if there occurs a Termination of Employment for any reason other than
death, Disability, Retirement or Cause, any Stock Option held by such optionee
shall thereupon terminate, except that such Stock Option, to the extent then
exercisable, or on such accelerated basis as the Compensation Committee may
determine, may, if such Termination of Employment is without Cause, be exercised
for the lesser of (A) in the case of a Non-Qualified Stock Option, one year from
the date of such Termination of Employment or the balance of such Stock Option’s
term and (B) in the case of an Incentive Stock Option, three months from the
date of such Termination of Employment or the balance of such Stock Option’s
term; provided, however, that if the optionee dies within such one-year or
three-month period, any unexercised Stock Option held by such optionee shall
notwithstanding the expiration of such one-year or three-month period, continue
to be exercisable to the extent to which it was exercisable at the time of death
for a period of one year from the date of such death or until the expiration of
the stated term of such Stock Option, whichever period is the
shorter. In the event of Termination of Employment for Cause, any
unexercised Stock Option held by such optionee shall expire immediately upon the
giving to the optionee of notice of such Termination of
Employment. Unless otherwise determined by the Compensation
Committee, for the purposes of the Plan, “Cause” shall mean (I) the conviction
of the optionee for a felony under Federal law or the law of the state in action
occurred, (II) dishonesty in the course of the optionee’s employment duties or
(III) willful and failure on the part of the optionee to perform his duties in
any material respect.
(x) Cashing Out of Stock
Option. On receipt of written notice of exercise and subject
to confirmation of applicable accounting implications, the Compensation
Committee may elect to cash out all or any part of the shares of Common Stock
for which a Stock Option is being exercised by paying the optionee an amount, in
cash or Common Stock, equal to the excess of the Fair Market Value of the Common
Stock over the option price times the number of shares of
13
Common Stock for
which the Stock Option is being exercised on the effective date of such cash
out.
(xi) Corporate Event Cash
Out. The provisions of Section 8 below shall
be applicable in the event of a Corporate Event as defined therein.
(b) Stock
Awards. Subject to the terms of this Plan,
the Compensation Committee may grant Awards to individuals in the form of shares
of Common Stock of the Company and may place restrictions on such Awards as set
forth in Section
6 below or may grant such shares of Common Stock without
restrictions.
SECTION
6. Restricted Stock.
(a) Administration. Restricted
Stock may be awarded either alone, in addition to or in tandem with other Awards
granted under the Plan. The Compensation Committee shall determine
the eligible persons to whom and the time or times at which Restricted Stock
shall be awarded, the number of shares of Restricted Stock to be awarded, the
number of shares of Restricted Stock to be awarded to any person, the duration
of the period (the “Restrictions Period”)
during which, and the conditions under which receipt of the Common Stock will be
Restricted, and the other terms and conditions of the Award in addition to those
set forth in Section
6(b).
The
Compensation Committee may condition the grant of Restricted Stock upon the
attainment of specified performance goals or such other factors or criteria as
the Compensation Committee shall determine, in its sole discretion.
The
provisions of Restricted Stock awards need not be the same with respect to each
recipient.
(b) Terms and
Conditions. The shares of Restricted Stock awarded pursuant to
this Section 6
may, in the sole discretion of the Compensation Committee, be subject to any of
the following terms and conditions:
(i) Subject
to the provisions of this Plan and the Award agreement referred to in Section 6(b)(v)
below, Restricted Stock Awards may not be sold, assigned, transferred, pledged
or otherwise encumbered during the Restrictions Period and a legend evidencing
such restrictions shall, at the request of the Company or the Compensation
Committee and upon such language as the Company or the Compensation Committee
shall require, be inserted on any stock certificate evidencing shares received
under a Restricted Stock Award. At the expiration of the Restrictions
Period if such Participant has previously received stock certificates with the
above-referenced legend thereon with respect to the referenced Restricted Stock
Award, certificates for shares of Common Stock without such legend shall, within
a reasonable time following the request of the Participant or his or her legal
representative, be delivered to the Participant or his or her legal
representative, by the Company’s transfer agent in a number equal to the shares
represented by the stock certificates previously received by such Participant
with respect to the referenced Restricted Stock Award.
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(ii) Unless
otherwise determined by the Compensation Committee at grant, amounts equal to
any dividends declared during the Restrictions Period with respect to the number
of shares covered by a Restricted Stock Award will be paid to the Participant
currently, or deferred and deemed to be reinvested in additional Restricted
Stock, or otherwise reinvested, all as determined at or after the time of the
Award by the Compensation Committee or, if the Compensation Committee determines
to allow the Participant to make the election, at the election of the
Participant.
(iii) Subject
to the provisions of the Award agreement and this Section 6, upon
termination of a Participant’s employment with the Company and any Subsidiary or
Affiliate for any reason during the Restrictions Period for a given Award, the
Restricted Stock in question will vest, or be forfeited, in accordance with the
terms and conditions established by the Compensation Committee at
grant.
(iv) The
Compensation Committee may, at or after grant, accelerate the vesting of all or
any part of any Restricted Stock Award and/or waive the deferral limitations for
all or any part of such Award.
(v) Each
Restricted Stock Award shall be confirmed by, and subject to the terms of, a
Restricted Stock agreement executed by the Company and the
Participant.
(c) Limitations and Additional
Restrictions Applicable to Restricted Stock
Awards. Notwithstanding the provisions of this Section 6, any awards
of Restricted Stock under this Plan shall be subject to the provisions of Section 14
below.
SECTION
7. Other Stock-Based Awards
Subject
to all other applicable provisions of this Plan, including but not limited to
the provisions of
Section 9 and Section 14 below, the
Compensation Committee may grant any other cash, stock or stock-related Awards
to any eligible individual under this Plan that the Compensation Committee deems
appropriate, including, but not limited to, stock appreciation rights, limited
stock appreciation rights, phantom stock Awards, the bargain purchase of Stock
and Stock bonuses. Any such benefits and any related agreements shall
contain such terms and conditions as the Compensation Committee deems
appropriate including, but not limited to the right to settle any stock
appreciation right by use of Common Stock. Such Awards and agreements
need not be identical. The Compensation Committee may provide a stock
option deferral program or similar types of plans designed to provide further
deferral of taxable income to Participants including the use of unfunded
deferred compensation arrangements that may
15
SECTION 8. Changes in
Company’s Capital Structure.
(a) Corporate
Events. Notwithstanding
the above, in the event of any of the following:
(i) The
Company is merged or consolidated with another corporation or
entity;
(ii) All
or substantially all of the assets of the Company or the Common Stock are
acquired by another person or entity;
(iii) The
reorganization or liquidation of the Company; or
(iv) The
Company shall enter into a written agreement to undergo an event described in
clauses (i), (ii) or (iii) above,
(each
(i), (ii), (iii) and (iv) above, a “Corporate Event”)
then, the Company shall require the successor corporation or parent thereof to
assume such outstanding Awards; provided, however, the Company
or the Compensation Committee may, in lieu of requiring such assumption, provide
that all outstanding Awards shall terminate as of the consummation of such
Corporate Event, and (x) accelerate the exercisability of, or cause all vesting
restrictions to lapse on, all outstanding Awards to a date at least ten days
prior to the date of such Corporate Event and/or (y) provide that holders of
Awards will receive a cash payment in respect of cancellation of their Awards
based on the amount (if any) by which the per share consideration being paid for
the Stock in connection with such Corporate Event exceeds the applicable
exercise price.
For
purposes of this Section 8, an Award
shall be considered assumed, without limitation, if, at the time of issuance of
the stock or other consideration upon a Corporate Event, each holder of an Award
would be entitled to receive upon exercise of the award the same number and kind
of shares of stock or the same amount of property, cash or securities as such
holder would have been entitled to receive upon the occurrence of the
transaction if the holder had been, immediately prior to such transaction, the
holder of the number of shares of Stock covered by the Award at such time;
provided, that if such consideration received in the transaction is not solely
equity securities of the successor entity, the Company or the Compensation
Committee may, with the consent of the successor entity, provide for the
consideration to be received upon exercise of the Award to be solely equity
securities of the successor entity equal to the Fair Market Value of the per
share consideration received by holders of Stock in the Corporate
Event.
16
(b) Effect of Change in
Control. Except
to the extent reflected in a particular Award agreement or as determined by the
Company or the Compensation Committee, in the event of a Change in Control,
notwithstanding any vesting schedule with respect to an Award of Options or
Restricted Stock, such Option shall become immediately exercisable with respect
to 100% of the shares subject to such Option, and the Restrictions Period shall
expire immediately with respect to 100% of such shares of Restricted
Stock. In the event of a Change in Control, all other Awards shall
become fully vested and or payable to the fullest extent of any Award or portion
thereof that has not then expired and any restrictions with respect thereto
shall expire. The Company and the Compensation Committee shall have
full authority and discretion to interpret this Section 8(b) and to
implement any course of action with respect to any Award so as to satisfy the
intent of this provision. The obligations of the Company under the
Plan shall be binding upon any successor corporation or organization resulting
from the merger, consolidation or other reorganization of the Company, or upon
any successor corporation or organization succeeding to substantially all of the
assets and business of the Company.
SECTION
9. Term, Amendment and Termination.
The Plan
will terminate on May 5, 2013. Under the Plan, Awards outstanding as
of May 5, 2013 shall not be affected or impaired by the termination of the
Plan.
The Board
may not amend, alter or discontinue the Plan or an Award in such manner so as
to impair the rights of an optionee under a Stock Option or a
recipient of a Restricted Stock Award theretofore granted without the optionee’s
or recipient’s consent except such an amendment made to cause
the Award to qualify for the exemption provided by Rule 16b-3. If any
proposed amendment to the Plan would (i) materially increase the benefits
accruing to Participants under the Plan, (ii) materially increase the aggregate
number of securities that may be issued under the Plan or (iii) materially
reduce the requirements as to eligibility for participation in the Plan, then
to the extent required
by applicable law or deemed necessary or advisable by the Compensation
Committee, such amendment shall be presented to the Company’s
stockholders for approval. Notwithstanding the foregoing, however,
the requirement that any such amendments to the Plan be presented to the
Company's stockholders for approval shall not apply to such amendments as
required by applicable law or to cause the Plan to comply with generally
accepted accounting principles.
Subject
to the above provisions, the Board shall have authority to amend the Plan to
take into account changes in law and tax and accounting rules, as well as other
developments and to grant Awards which qualify for beneficial treatment under
such rules without stockholder approval. Notwithstanding the above
provisions, any changes or adjustments as described in Section 3(b) above
may be made without stockholder approval.
SECTION
10. Unfunded
Status of Plan.
It is
presently intended that the Plan constitute an “unfunded” plan for incentive and
deferred compensation. The Compensation Committee may authorize the
creation of trusts
17
SECTION
11. General Provisions.
(a) Additional Provisions of an
Award. The Compensation Committee may
require each person purchasing or receiving shares pursuant to an Award to
represent to and agree with the Company in writing that such person is acquiring
the shares without a view to the distribution thereof. The
certificates for such shares may include any legend which the Compensation
Committee deems appropriate to reflect any restrictions on
transfer. All certificates for shares of Common Stock or other
securities delivered under the Plan shall be subject to such stock transfer
orders and other restrictions as the Compensation Committee may deem advisable
under the rules, regulations and other requirements of the Commission, any stock
exchange upon which the Common Stock is then listed and any applicable Federal
or state securities law, and the Compensation Committee may cause a legend or
legends to be put on any such certificates to make appropriate reference to such
restrictions.
(b) Privileges of Stock
Ownership. Except as otherwise provided in this Plan, no
person shall be entitled to the privileges of stock ownership in respect of
shares of Common Stock which are subject to Awards hereunder until such shares
shall have been issued to such person.
(c) Government and Other
Regulations. The obligation of the Company to make payment of
Awards in Stock or otherwise shall be subject to all applicable laws, rules and
regulations, and to such approvals by governmental agencies as may be
required. Notwithstanding any terms or conditions of any Award to the
contrary, the Company shall be under no obligation to offer to sell or to sell
and shall be prohibited from offering to sell or selling any shares of Stock
pursuant to an Award unless such shares have been properly registered for sale
pursuant to the Securities Act with the Securities and Exchange Commission or
unless the Company has received an opinion of counsel, satisfactory to the
Company, that such shares may be offered or sold without such registration
pursuant to an available exemption therefrom and the terms and conditions of
such exemption have been fully complied with. The Company shall be
under no obligation to register for sale under the Securities Act any of the
shares of Stock to be offered or sold under the Plan. If the shares
of Stock offered for sale or sold under the Plan are offered or sold pursuant to
an exemption from registration under the Securities Act, the Company may
restrict the transfer of such shares and may legend the Stock
18
certificates representing such shares in such
manner as it deems advisable to ensure the availability of any such
exemption.
(d) No Restriction on Other
Compensation Arrangements. Nothing contained in the Plan shall
prevent the Company or any Subsidiary or Affiliate from adopting other or
additional compensation arrangements for its employees.
(e) No Employment Right or
Claim. The adoption
of the Plan shall not confer upon any employee any right to continued employment
nor shall it interfere in any way with the right of the Company or any
Subsidiary or Affiliate to terminate the employment of any employee at any
time. No individual shall have any claim or right to be granted an
Award under the Plan, or, having been selected for the grant of an Award, to be
selected for the grant of any other Award.
(f) Tax
Withholding. No later than
the date as of which an amount first becomes subject to being included in the
gross income of the Participant for Federal income tax purposes with respect to
any Award under the Plan, the Participant shall pay to the Company, or make
arrangements satisfactory to the Company regarding the payment of, any Federal,
state, local or foreign taxes of any kind required by law to be withheld with
respect to such amount. If so determined by the Compensation Committee,
withholding obligations may be settled with Common Stock, including Common Stock
that is part of the Award that gives rise to the withholding
requirement. The obligations of the Company under the Plan shall be
conditional on such payment or arrangements, and the Company, its Subsidiaries
and its Affiliates shall, to the extent permitted by law, have the right to
deduct any such taxes from any payment otherwise due to the
Participant. The Compensation Committee may establish such procedures
as it deems appropriate, including the making of irrevocable elections, for the
settlement of withholding obligations with Common Stock.
(g) Payments to Persons Other
Than Participants. If any person to whom any amount is payable
under the Plan is unable to care for his affairs because of illness or accident,
or is a minor, or has died, then any payment due to such person or his estate
(unless a prior claim therefor has been made by a duly appointed legal
representative) may, if the Compensation Committee so directs the Company, be
paid to his spouse, child, relative, an institution maintaining or having
custody of such person, or any other person deemed by the Compensation Committee
to be a proper recipient on behalf of such person otherwise entitled to
payment. Any such payment shall be a complete discharge of the
liability of the Company therefor.
(h) No Liability of Compensation
Committee Members. No member of the Compensation Committee
shall be personally liable by reason of any contract or other instrument
executed by such member or on his behalf in his capacity as a member of the
Compensation Committee nor for any mistake of judgment made in good faith, and
the Company shall indemnify and hold harmless each member of the Compensation
Committee and each other employee, officer or director of the Company to whom
any duty or power relating to the administration or interpretation of the Plan
may be allocated or delegated, against any cost or expense (including counsel
fees) or liability (including any sum paid in settlement of a claim) arising out
of any act or omission to act in connection with the Plan unless arising out of
such
19
person's
own fraud or willful bad faith; provided, however, that
approval of the Board shall be required for the payment of any amount in
settlement of a claim against any such person. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company's Certificate of
Incorporation or By-Laws, as a matter of law, or otherwise, or any power that
the Company may have to indemnify them or hold them harmless.
(i) Reliance on
Reports. Each member of the Compensation Committee and each
member of the Board shall be fully justified in relying, acting or failing to
act, and shall not be liable for having so relied, acted or failed to act in
good faith, upon any report made by the independent public accountant of the
Company and its Subsidiaries and upon any other information furnished in
connection with the Plan by any person or persons other than
himself.
(j) Relationship to Other
Benefits. No payment under the Plan shall be taken into
account in determining any benefits under any pension, retirement, profit
sharing, group insurance or other benefit plan of the Company or any Subsidiary
except as otherwise specifically provided in such other plan.
(k) Expenses. The
expenses of administering the Plan shall be borne by the Company and its
Subsidiaries.
(l) Pronouns. Masculine
pronouns and other words of masculine gender shall refer to both men and
women.
(m) 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.
(n) Termination of
Employment. For all purposes herein, a person who transfers
from employment or service with the Company to employment or service with a
Subsidiary or vice versa shall not be deemed to have terminated employment or
service with the Company or a Subsidiary.
(o) Other
Procedures. The Compensation Committee shall
establish such procedures as it deems appropriate for a Participant to designate
a beneficiary to whom any amounts payable in the event of the Participant’s
death are to be paid.
(p) Governing
Law. The Plan and all Awards made and
actions taken thereunder shall be governed by and construed in accordance with
the laws of the State of Delaware.
SECTION
12. Effective Date of Plan.
Provided
the Plan is approved by the Company’s stockholders, the Plan shall be effective
on May 5, 2003, the date the Plan was submitted to the Company’s
stockholders for vote.
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SECTION 13. Non-Employee
Director Stock Options and Non-Employee Director Shares.
(a) Each
director of the Company who is not otherwise an employee of the Company or any
Subsidiary or Affiliate from and after the effective date of the Plan (a “Non-Employee
Director”) shall, on each December 31 during such Non-Employee Director’s
term, automatically be granted, either, in the discretion of the Compensation
Committee,
(i)
Non-Qualified Stock Options to purchase 1,000 shares of Common Stock
having an exercise price per share equal to 100% of the Fair Market value of the
Common Stock at the
Date of Grant of such Non-Qualified Stock Option or
(ii)
Non-Employee Director Shares, as defined below, in an amount not to exceed 1,000
shares of Non-Employee Director Shares per grant per year.
Each such Non-Employee Director, upon
joining the Board, shall also be awarded 1,000 shares of Common Stock (such
initial grant of Common Stock and shares of Common Stock awarded pursuant to
Subsection (ii) of this Section 13 are herein
referred to as “Non-Employee Director
Shares”). Non-Employee Director Shares shall be fully vested
upon grant, but may not be sold, pledged, or otherwise transferred in any manner
during a Non-Employee Director’s term and for one year thereafter; provided,
however, that in the event of the death or Disability of a Non-Employee
Director, all transfer restrictions concerning such Non-Employee Director Shares
shall immediately be removed, and such shares shall thereupon be freely
transferrable by the Non-Employee Director or by his or her estate or legal
representative, as applicable. The Compensation Committee may require
that such shares bear an appropriate legend evidencing such transfer
restrictions. The Compensation Committee may determine to grant the
Awards set forth above on January 1 of a year in lieu of December
31.
(b) An
automatic Non-Employee Director Stock Option or award of additional Non-Employee
Director Shares shall be granted hereunder only if as of each Date of Grant (or,
in the case of any initial grant, from and after the effective date of the Plan)
the Non-Employee Director (i) is not otherwise an employee of the Company or any
Subsidiary or Affiliate, (ii) has not been an employee of the Company or any
Subsidiary or Affiliate for any part of the preceding fiscal year and (iii) has
served on the Board continuously since the commencement of his
term.
(c) Each
holder of a Stock Option granted pursuant to this Section 13 shall also
have the rights specified in Section
5(a).
(d) In
the event that the number of shares of Common Stock available for future grant
under the Plan is insufficient to make all automatic grants required to be made
on such date, then all Non-Employee Directors entitled to a grant on such date
shall share ratably in the number of options on shares available for grant under
the Plan and/or shall share ratably in the number of shares available for grant
under the Plan.
21
(e) Except
as expressly provided in this Section 13, any Stock
Option granted hereunder shall be subject to the terms and conditions of the
Plan as if the grant were made pursuant to Section 5(a)
hereof.
(f) Awards
granted under this Section 13 shall be
subject to any applicable restrictions set forth in Section 14(a)
below.
SECTION
14. Award Limitations.
(a) General
Restriction. Any provision of this Plan to
the contrary notwithstanding, in no event shall any Awards or Award of
Non-Employee Director Shares be made, and in no event shall any option be
granted or exercised, if the grant or exercise of such Award or Option, would
result in a violation of the Common Stock
ownership limits or any other requirements necessary for qualification of the
Company as a “real estate investment trust” for federal income tax
purposes. For purposes of the Plan, in determining whether such
limits would be violated, Participants shall be deemed to own beneficially any
shares of Common Stock subject to unexercised Options, whether or not
vested. Any such Award or grant or exercise of Options, if made,
shall be null and void and shall have no legal effect. In addition,
the Plan and any Awards or Options granted hereunder shall be subject in all
events to, and shall in no event violate (i) the “Ownership Limit” as set forth
in the Company’s Amended and Restated Certificate of Incorporation, (ii) the
provisions of any applicable rule or regulation of the Securities and Exchange
Commission, the New York Stock Exchange and/or such other exchange upon which
the Company’s stock may be traded or (iii) any provision of any federal or state
law, rule or regulation.
(b) Restrictions on Stock
Awards. Stock Awards granted from the
Plan must be subject to the following guidelines:
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(i)
|
Stock
Awards may be granted from the Plan in lieu of cash compensation;
and
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|
(ii)
|
Except
for Stock Awards falling within the 5% Authorization (defined below),
Stock Awards that are granted from the Plan other than in lieu of cash
compensation (A) pursuant to a stock award program or (B) independently,
must provide for a vesting period of a minimum of three (3) years or may
provide for a vesting period of less than three (3) years but at least one
(1) year if the restrictions period placed upon the Stock Award is
performance based.
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Up to a
maximum of Stock Awards equivalent to 5% of the total shares available for grant
under the Plan as set forth in the first sentence of Section 3(a) above
(the “5%
Authorization”), Stock Awards may be granted to officers and employees of
the Company other than in lieu of cash compensation and without the necessity of
compliance with the vesting or performance based criteria set forth
directly above.