EXHIBIT 10.8

 

ALTISOURCE ASSET MANAGEMENT CORPORATION

2012 SPECIAL EQUITY INCENTIVE PLAN

 

SECTION 1.                         PURPOSE

 

1.01                        The purpose of the 2012 Special Equity Incentive
Plan (the “Plan”) is to assist Altisource Asset Management Corporation (the
“Corporation”) by incentivizing individuals who are providing services to the
Corporation through their service for entities that have service relationships
with the Corporation.

 

SECTION 2.                         DEFINITIONS; CONSTRUCTION

 

2.01                        Definitions.  In addition to the terms defined
elsewhere in the Plan, the following terms as used in the Plan shall have the
following meanings when used with initial capital letters:

 

2.01.1              “Administrator” means the Board or such committee of the
Board as may be designated by the Board to administer the Plan.

 

2.01.2              “Award” means any Option, Restricted Stock, Performance
Award or Other Stock-Based Award, or any other right or interest relating to
Shares granted under the Plan.

 

2.01.3              “Award Agreement” means any written agreement, contract or
other instrument or document evidencing an Award.

 

2.01.4              “Board” means the Corporation’s Board of Directors.

 

2.01.5              “Cause” means the definition provided in any employment,
severance or other agreement governing the relationship between a Participant
and the applicable Employer Entity, and if no such definition exists, then

 

(i)                         the Participant’s willful and intentional repeated
failure or refusal, continuing after notice that specifically identifies the
breach(es) complained of, to perform substantially his or her material duties,
responsibilities and obligations (other than a failure resulting from grantee’s
incapacity due to physical or mental illness or other reasons beyond the control
of grantee), and which failure or refusal results in demonstrable direct and
material injury to the applicable Employer Entity;

 

(ii)                      the Participant’s willful and intentional act or
failure to act involving fraud, misrepresentation, theft, embezzlement,
dishonesty or moral turpitude (collectively, “Fraud”) which results in
demonstrable direct and material injury to the applicable Employer Entity;

 

(iii)                    the Participant’s conviction of (or a plea of nolo
contendere to) an offense which is a felony in the jurisdiction involved or
which is a misdemeanor in the jurisdiction involved but which involves Fraud;
and

 

--------------------------------------------------------------------------------

 

(iv)                      the Participant’s material breach of a written policy
of the applicable Employer Entity or the rules of any governmental or regulatory
body applicable to the applicable Employer Entity.

 

2.01.6              “Code” means the Internal Revenue Code of 1986, as amended
from time to time, together with rules, regulations and interpretations
promulgated thereunder.  References to particular sections of the Code shall
include any successor provisions.

 

2.01.7              “Change of Control” shall mean a change in control of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), whether or not the Corporation is then
subject to such reporting requirement.

 

2.01.8              “Common Stock” means shares of the common stock, par value
$1.00 per share, and such other securities of the Corporation or other
corporation or entity as may be substituted for Shares pursuant to Section 8.01
hereof.

 

2.01.9              “Employer Entity” means Ocwen Financial Corporation,
Altisource Portfolio Solutions S.A. or another entity with a service
relationship with the Corporation.

 

2.01.10       “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

 

2.01.11       “Fair Market Value” of shares of any stock, including but not
limited to Common Stock, or units of any other securities (herein “shares”),
shall be the mean between the highest and lowest sales prices per share for the
date(s) as established by the Board as of which Fair Market Value is to be
determined in the principal market in which such shares are traded, as quoted in
The Wall Street Journal (or in such other reliable publication as the
Administrator, in its discretion, may determine to rely upon).  If the Fair
Market Value of shares on any date(s) cannot be determined on the basis set
forth in the preceding sentence, or if a determination is required as to the
Fair Market Value on any date of property other than shares, the Administrator
shall in good faith determine the Fair Market Value of such shares or other
property on such date(s).  Fair Market Value shall be determined without regard
to any restriction other than a restriction which, by its terms, will never
lapse.

 

2.01.12       “Option” means a right, granted under Section 6.02 hereof, to
purchase Shares at a specified price during specified time periods.

 

2.01.13       “Other Stock-Based Award” means an Award, granted under
Section 6.05 hereof, that is denominated or payable in, valued in whole or in
part by reference to, or otherwise based on, or related to, Shares.

 

2.01.14       “Participant” means (a) an individual who is not an employee of
the Corporation but is employed by Ocwen Financial Corporation, Altisource
Portfolio Solutions S.A. or another entity with a service relationship with the
Corporation.

 

2.01.15       “Performance Award,” “Performance Goal” and “Performance Period”
shall have the meanings provided in Section 6.04.

 

2

--------------------------------------------------------------------------------

 

2.01.16       “Person” shall have the meaning ascribed to such term in
Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and
14(d) thereof, and shall include a “group” as defined in Section 13(d) thereof.

 

2.01.17       “Restricted Stock” means Shares, granted under Section 6.03
hereof, that are subject to certain restrictions.

 

2.01.18       “Shares” means the common stock of the Corporation, par value
$0.01 per share, and such other securities of the Corporation as may be
substituted for Shares pursuant to Section 8.01 hereof.

 

2.01.19       “Subsidiary” means any corporation in an unbroken chain of
corporations beginning with the Corporation, if each of the corporations other
than the last corporation in the chain owns stock possessing at least 50% of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.

 

2.02                        Construction.  For purposes of the Plan, the
following rules of construction shall apply:

 

2.02.1              The word “or” is disjunctive but not necessarily exclusive.

 

2.02.2              Words in the singular include the plural; words in the
plural include the singular; words in the neuter gender include the masculine
and feminine genders, and words in the masculine or feminine gender include the
other and neuter genders.

 

SECTION 3.                         ADMINISTRATION

 

3.01                        The Plan shall be administered by the
Administrator.  The Administrator shall have complete, full and final authority
to take the following actions, in each case subject to and consistent with the
provisions of the Plan:

 

(i)                                     to designate Participants;

 

(ii)                                  to determine the type or types of Awards
to be granted to each Participant;

 

(iii)                             to determine the number of Awards to be
granted, the number of Shares or amount of cash or other property to which an
Award will relate, the terms and conditions of any Award (including, but not
limited to, any exercise price, grant price or purchase price, any limitation or
restriction, any schedule for lapse of limitations, forfeiture restrictions or
restrictions on exercisability or transferability, and accelerations or waivers
thereof, including in the case of a Change of Control based in each case on such
considerations as the Administrator shall determine), and all other matters to
be determined in connection with an Award;

 

(iv)                              to determine whether, to what extent and under
what circumstances an Award may be settled in, or the exercise price of an Award
may be paid in cash, Shares, other Awards or other property, or an Award may be
accelerated, vested, canceled, forfeited, exchanged or surrendered;

 

3

--------------------------------------------------------------------------------

 

(v)                                 to interpret and administer the Plan and any
instrument or agreement relating to, or Award made under, the Plan;

 

(vi)                              to prescribe the form of each Award Agreement,
which need not be identical for each Participant;

 

(vii)                           to adopt, amend, suspend, waive and rescind such
rules and regulations as the Administrator may deem necessary or advisable to
administer the Plan;

 

(viii)                        to correct any defect or supply any omission or
reconcile any inconsistency, and to construe and interpret the Plan, the
rules and regulations, any Award Agreement or other instrument entered into or
Award made under the Plan;

 

(ix)                              to make all other decisions and determinations
as may be required under the terms of the Plan or as the Administrator may deem
necessary or advisable for the administration of the Plan; and

 

(x)                                 to make such filings and take such actions
as may be required from time to time by appropriate state, regulatory and
governmental agencies.  Any action of the Administrator with respect to the Plan
shall be final, conclusive and binding on all Persons, including the
Corporation, Subsidiaries, Participants and any Person claiming any rights under
the Plan from or through any Participants.  The express grant of any specific
power to the Administrator, and the taking of any action by the Administrator,
shall not be construed as limiting any power or authority of the Administrator. 
The Administrator may delegate to officers, managers and/or agents of the
Corporation or any Subsidiary the authority, subject to such terms as the
Administrator shall determine, to perform administrative and other functions
under the Plan.  Each member of the Administrator shall be entitled to, in good
faith, rely or act upon any report or other information furnished to him by an
officer, manager or other employee of the Corporation or a Subsidiary, the
Corporation’s independent certified public accountants, or any executive
compensation consultant or other professional retained by the Corporation and/or
Administrator to assist in the administration of the Plan.

 

SECTION 4.                         SHARES SUBJECT TO THE PLAN

 

4.01                        The maximum net number of Shares which may be issued
and in respect of which Awards may be granted under the Plan shall be limited to
93,053 shares of Common Stock, subject to adjustment as

 

4

--------------------------------------------------------------------------------

 

provided in Section 8.01, which may be used for all forms of Awards.  Each Share
issued under the Plan pursuant to an Award shall reduce the number of available
Shares by 1.00.

 

For purposes of this Section 4.01, the number of Shares to which an Award
relates shall be counted against the number of Shares available under the Plan
at the time of grant of the Award, unless such number of Shares cannot be
determined at that time, in which case the number of Shares actually distributed
pursuant to the Award shall be counted against the number of Shares available
under the Plan at the time of distribution; provided, however, that Awards
related to or retroactively added to, or granted in tandem with, substituted for
or converted into, other Awards shall be counted or not counted against the
number of Shares reserved and available under the Plan in accordance with
procedures adopted by the Administrator so as to ensure appropriate counting but
avoid double counting.

 

If any Shares to which an Award relates are forfeited or the Award otherwise
terminates without payment being made to the Participant in the form of Shares
or if payment is made to the Participant in the form of cash, cash equivalents
or other property other than Shares, any Shares counted against the number of
Shares available under the Plan with respect to such Award shall, to the extent
of any such forfeiture or termination or alternative payment, again be available
for Awards under the Plan.  If the exercise price of an Award is paid by
delivering to the Corporation Shares previously owned by the Participant or if
Shares are delivered or withheld for purposes of satisfying a tax withholding
obligation, the number of Shares covered by the Award equal to the number of
Shares so delivered or withheld shall, however, be counted against the number of
Shares granted and shall not again be available for Awards under the Plan.  Any
Shares distributed pursuant to an Award may consist, in whole or part, of
authorized and unissued Shares, including Shares repurchased by the Corporation
for purposes of the Plan.

 

SECTION 5.                         ELIGIBILITY

 

5.01                        Awards may be granted only to individuals who are
employees of Ocwen Financial Corporation, Altisource Portfolio Solutions S.A. or
another entity with a service relationship with the Corporation.

 

SECTION 6.                         SPECIFIC TERMS OF AWARDS

 

6.01                        General.  Subject to the terms of the Plan and any
applicable Award Agreement, Awards may be granted as set forth in this
Section 6.  In addition, the Administrator may impose on any Award or the
exercise thereof, at the date of grant or thereafter (subject to the terms of
Section 9.01), such additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Administrator shall determine, including separate
escrow provisions and terms requiring forfeiture of Awards in the event of
termination of employment or service by the Participant.  Except as required by
applicable law, Awards may be granted for no consideration other than prior
and/or future services.

 

5

--------------------------------------------------------------------------------

 

 

6.02                        Options.  The Administrator is authorized to grant
Options to Participants on the following terms and conditions:

 

(i)                                     Exercise Price.  The criteria for
determining the exercise price per Share of an Option shall be determined and
such price shall be established by the Administrator prior to each grant;

 

(ii)                                  Option Term.  The term of each Option
shall be determined by the Administrator, except that no Option shall be
exercisable after the expiration of ten years from the date of grant.  The
Option shall be evidenced by a form of written Award Agreement, and subject to
the terms thereof;

 

(iii)                             Times and Methods of Exercise.  The
Administrator shall determine the time or times at which an Option may be
exercised in whole or in part, the methods by which the exercise price may be
paid or deemed to be paid, and the form of such payment, including, without
limitation, cash, Shares, or other property or any combination thereof, having a
Fair Market Value on the date of exercise equal to the exercise price, provided,
however, that except as otherwise determined by the Administrator, in its
discretion, at the time the Option is granted, no shares which have been held
for less than six months may be delivered in payment of the exercise price of an
Option.  Delivery of Shares in payment of the exercise price of an Option, if
authorized by the Administrator, may be accomplished through the effective
transfer to the Corporation of Shares held by a broker or other agent; and

 

Unless otherwise determined by the Administrator, the Corporation will also
cooperate with any person exercising an Option who participates in a cashless
exercise program of a broker or other agent under which all or part of the
Shares received upon exercise of the Option are sold through the broker or other
agent, for the purpose of paying the exercise price of an Option. 
Notwithstanding the preceding sentence, unless the Administrator, in its
discretion, shall otherwise determine, the exercise of the Option shall not be
deemed to occur, and no Shares will be issued by the Corporation upon exercise
of an Option, until the Corporation has received payment in full of the exercise
price.

 

(iv)                              Termination of Employment.  In the case of
Participants, unless otherwise determined by the Administrator and reflected in
the Award Agreement or award program:

 

(A)                               if a Participant shall die while employed by
the applicable Employer Entity or during a period following termination of
employment during which an Option otherwise remains exercisable under this
Section 6.02(iv), Options granted to the Participant, to the extent exercisable
at the time of the Participant’s

 

6

--------------------------------------------------------------------------------

 

death, may be exercised within two years after the date of the Participant’s
death, but not later than the expiration date of the Options, by the executor or
administrator of the Participant’s estate or by the Person or Persons to whom
the Participant shall have transferred such right by will or by the laws of
descent and distribution;

 

(B)                               if the Participant must terminate employment
due to disability, the Options may be exercised within three years after the
date of termination, but not later than the expiration date of the Options;

 

(C)                               if the Participant has attained the age of 60
and has been an employee of the applicable Employer Entity for not less than
three (3) years as of or on the date of termination of employment by reason of
retirement, the Options shall vest and shall become immediately exercisable in
full on the date of termination and may be exercised within three years after
the date of retirement, but not later than the expiration date of the Options;

 

(D)                               if the employment of a Participant with the
applicable Employer Entity shall be involuntarily terminated under circumstances
which would qualify the Participant for benefits under a severance plan of the
applicable Employer Entity or shall terminate his or her employment with the
written consent of the applicable Employer Entity, the Administrator may elect
to vest the Options immediately.  Options granted to the Participant, to the
extent exercisable at the date of the Participant’s termination of employment,
may be exercised within six months after the date of termination of employment,
but not later than the expiration date of the Options;

 

(E)                                if the employment of a Participant with the
applicable Employer Entity shall be involuntarily terminated for Cause, any
outstanding Options granted to such Participant, whether or not vested, shall
terminate on the date of such termination; and

 

(F)                                 except to the extent an Option remains
exercisable under paragraphs (A) through (D) above, any Option granted to a
Participant shall terminate six months after the date of termination of
employment or engagement of the Participant with the applicable Employer Entity.

 

6.03                        Restricted Stock.  The Administrator is authorized
to grant Restricted Stock to Participants on the following terms and conditions:

 

(i)                                     Issuance and Restrictions.  Restricted
Stock shall be subject to such restrictions on transferability and other
restrictions as the Administrator

 

7

--------------------------------------------------------------------------------

 

may impose (including, without limitation, limitations on the right to vote
Restricted Stock or the right to receive dividends thereon), which restrictions
may lapse separately or in combination at such times, under such circumstances,
in such installments or otherwise, as the Administrator shall determine at the
time of grant or thereafter.  The restriction period applicable to Restricted
Stock shall, in the case of a time-based restriction, be not less than three
years, with ratable vesting over such period or, in the case of a
performance-based restriction period, be not less than one year;

 

(ii)                                  Forfeiture.  Except as otherwise
determined by the Administrator at the time of grant or thereafter, upon
termination of employment during the applicable restriction period, Restricted
Stock that is at that time subject to restrictions shall be forfeited and
reacquired by the Corporation; provided, however, that the Administrator may
provide, by rule or regulation or in any Award Agreement, that restrictions on
Restricted Stock shall be waived in whole or in part in the event of
terminations resulting from specified causes, and the Administrator may in other
cases waive in whole or in part restrictions on Restricted Stock; and

 

(iii)                               Certificates for Shares.  Restricted Stock
granted under the Plan may be evidenced in such manner as the Administrator
shall determine, including, without limitation, issuance of certificates
representing Shares, which may be held in escrow.  Certificates representing
Shares of Restricted Stock shall be registered in the name of the Participant
and shall bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such Restricted Stock.

 

6.04                        Performance Awards.  The Administrator is authorized
to grant Performance Awards to Participants on the following terms and
conditions:

 

(i)                                     Right to Payment.  A Performance Award
shall represent a right to receive Shares based on the achievement, or the level
of achievement, during a specified Performance Period of one or more Performance
Goals established by the Administrator at the time of the Award;

 

(ii)                                  Terms of Performance Awards.  At or prior
to the time a Performance Award is granted, the Administrator shall cause to be
set forth in the Award Agreement or otherwise in writing (1) the Performance
Goals applicable to the Award and the Performance Period during which the
achievement of the Performance Goals shall be measured, (2) the amount which may
be earned by the Participant based on the achievement, or the level of
achievement, of the Performance Goals or the formula by which such amount shall
be determined and (3) such other terms and conditions applicable to the Award as
the Administrator may, in its discretion, determine to include therein.  The
terms so established by the Administrator shall be objective such that a third
party having knowledge

 

8

--------------------------------------------------------------------------------

 

of the relevant facts could determine whether or not any Performance Goal has
been achieved, or the extent of such achievement, and the amount, if any, which
has been earned by the Participant based on such performance.  The Administrator
may retain the discretion to reduce (but not to increase) the amount of a
Performance Award which will be earned based on the achievement of Performance
Goals.  When the Performance Goals are established, the Administrator shall also
specify the manner in which the level of achievement of such Performance Goals
shall be calculated and the weighting assigned to such Performance Goals.  The
Administrator may determine that unusual items or certain specified events or
occurrences, including changes in accounting standards or tax laws and the
effects of non-operational items or extraordinary items as defined by generally
accepted accounting principles, shall be excluded from the calculation;

 

(iii)                               Performance Goals. “Performance Goals” shall
mean one or more pre-established, objective measures of performance during a
specified “Performance Period”, selected by the Administrator in its discretion.

 

Performance Goals may be based upon one or more of the following objective
performance measures and expressed in either, or a combination of, absolute or
relative values: earnings per share, earnings per share growth, return on
capital employed, costs, net income, net income growth, operating margin,
revenues, revenue growth, revenue from operations, expenses, income from
operations as a percent of capital employed, income from operations, cash flow,
market share, return on equity, return on assets, earnings (including EBITDA and
EBIT), operating cash flow, operating cash flow as a percent of capital
employed, economic value added, gross margin, total shareholder return,
workforce diversity, number of accounts, workers’ compensation claims, budgeted
amounts, cost per hire, turnover rate, and/or training costs and expenses. 
Performance Goals based on such performance measures may be based either on the
performance of the Corporation, a Subsidiary or Subsidiaries, affiliate, any
branch, department, business unit or other portion thereof under such measure
for the Performance Period and/or upon a comparison of such performance with the
performance of a peer group of corporations, prior Performance Periods or other
measure selected or defined by the Administrator at the time of making a
Performance Award.  The Administrator may in its discretion also determine to
use other objective performance measures as Performance Goals;

 

(iv)                              Administrator Certification.  Following
completion of the applicable Performance Period, and prior to any payment of a
Performance Award to the Participant, the Administrator shall determine in
accordance with the terms of the Performance Award and shall certify in writing
whether the applicable Performance Goal or Goals were achieved, or the level of
such achievement, and the amount, if any, earned by the Participant based upon

 

9

--------------------------------------------------------------------------------

 

such performance.  For this purpose, approved minutes of the meeting of the
Administrator at which certification is made shall be sufficient to satisfy the
requirement of a written certification; and

 

Performance Awards are not intended to provide for the deferral of compensation,
such that payment of Performance Awards shall be paid within two and one-half
months following the end of the calendar year in which the Performance Period
ends or such other earlier time period if and to the extent as may be required
to avoid characterization of such Awards as deferred compensation.

 

6.05                        Other Stock-Based Awards.  The Administrator is
authorized, subject to limitations under applicable law, to grant to
Participants, in lieu of salary, cash bonus, fees or other payments, such other
Awards that are denominated or payable in, valued in whole or in part by
reference to, or otherwise based on, or related to, Shares, as deemed by the
Administrator to be consistent with the purposes of the Plan, including, without
limitation, purchase rights, appreciation rights, Shares awarded which are not
subject to any restrictions or conditions, convertible securities, exchangeable
securities or other rights convertible or exchangeable into Shares, as the
Administrator in its discretion may determine.  In the discretion of the
Administrator, such Other Stock-Based Awards, including Shares, or other types
of Awards authorized under the Plan, may be used in connection with, or to
satisfy obligations of the Corporation or a Subsidiary under, other compensation
or incentive plans, programs or arrangements of the Corporation or any
Subsidiary for eligible Participants.

 

The Administrator shall determine the terms and conditions of Other Stock-Based
Awards.  Shares or securities delivered pursuant to a purchase right granted
under this Section 6.05 shall be purchased for such consideration, paid for by
such methods and in such forms, including, without limitation, cash, Shares, or
other property or any combination thereof, as the Administrator shall determine,
but the value of such consideration shall not be less than the Fair Market Value
of such Shares or other securities on the date of grant of such purchase right.

 

Appreciation rights may not be granted at a price less than the fair market
value of the underlying Shares on the date of grant.  Delivery of Shares or
other securities in payment of a purchase right or appreciation right, if
authorized by the Administrator, may be accomplished through the effective
transfer to the Corporation of Shares or other securities held by a broker or
other agent.  Unless otherwise determined by the Administrator, the Corporation
will also cooperate with any person exercising a purchase right who participates
in a cashless exercise program of a broker or other agent under which all or
part of the Shares or securities received upon exercise of a purchase right are
sold through the broker or other agent, or under which the broker or other agent
makes a loan to such person, for the purpose of paying the exercise price of a
purchase right.

 

Notwithstanding the preceding sentence, unless the Administrator, in its
discretion, shall otherwise determine, the exercise of the purchase right shall
not be deemed to occur, and

 

10

--------------------------------------------------------------------------------

 

no Shares or other securities will be issued by the Corporation upon exercise of
a purchase right, until the Corporation has received payment in full of the
exercise price.

 

SECTION 7.                         GENERAL TERMS OF AWARDS

 

7.01                        Stand-Alone, Tandem and Substitute Awards.  Awards
granted under the Plan may, in the discretion of the Administrator, be granted
either alone or in addition to, or in tandem with, any other Award granted under
the Plan or any award granted under any other plan, program or arrangement of
the Corporation or any Subsidiary (subject to the terms of Section 9.01) or any
business entity acquired or to be acquired by the Corporation or a Subsidiary.

 

Awards granted in addition to or in tandem with other Awards or awards may be
granted either at the same time as or at a different time from the grant of such
other Awards or awards.

 

7.02                        Term of Awards.  The term of each Award shall be for
such period as may be determined by the Administrator; provided, however, that
in no event shall the term of any Option exceed a period of ten years from the
date of its grant.

 

7.03                        Form of Payment of Awards.  Subject to the terms of
the Plan and any applicable Award Agreement, payments or substitutions to be
made by the Corporation upon the grant, exercise or other payment or
distribution of an Award may be made in such forms as the Administrator shall
determine at the time of grant or thereafter (subject to the terms of Section
9.01), including, without limitation, cash, Shares, or other property or any
combination thereof, in each case in accordance with rules and procedures
established, or as otherwise determined, by the Administrator.

 

7.04                        Limits on Transfer of Awards; Beneficiaries.  No
right or interest of a Participant in any Award shall be pledged, encumbered or
hypothecated to or in favor of any Person other than the Corporation, or shall
be subject to any lien, obligation or liability of such Participant to any
Person other than the Corporation or a Subsidiary except as otherwise
established by the Administrator at the time of grant or thereafter.  No Award
and no rights or interests therein shall be assignable or transferable by a
Participant otherwise than by will or the laws of descent and distribution, and
any Option or other right to purchase or acquire Shares granted to a Participant
under the Plan shall be exercisable during the Participant’s lifetime only by
such Participant.  A beneficiary, guardian, legal representative or other Person
claiming any rights under the Plan from or through any Participant shall be
subject to all the terms and conditions of the Plan and any Award Agreement
applicable to such Participant as well as any additional restrictions or
limitations deemed necessary or appropriate by the Administrator.

 

7.05                        Registration and Listing Compliance.  No Award shall
be paid and no Shares or other securities shall be distributed with respect to
any Award in a transaction subject to the registration requirements of the
Securities Act of 1933, as amended, or any state securities law or subject to a
listing requirement under any listing agreement between the Corporation and any
national securities exchange, and no Award shall confer upon any

 

11

--------------------------------------------------------------------------------

 

Participant rights to such payment or distribution until such laws and
contractual obligations of the Corporation have been complied with in all
material respects.  Except to the extent required by the terms of an Award
Agreement or another contract between the Corporation and the Participant,
neither the grant of any Award nor anything else contained herein shall obligate
the Corporation to take any action to comply with any requirements of any such
securities laws or contractual obligations relating to the registration (or
exemption therefrom) or listing of any Shares or other securities, whether or
not necessary in order to permit any such payment or distribution.

 

7.06                        Stock Certificates.  Awards representing Shares
under the Plan may be recorded in book entry form until the lapse of
restrictions or limitations thereon, or issued in the form of certificates.  All
certificates for Shares delivered under the terms of the Plan shall be subject
to such stop-transfer orders and other restrictions as the Administrator may
deem advisable under federal or state securities laws, rules and regulations
thereunder, and the rules of any national securities exchange or automated
quotation system on which Shares are listed or quoted.  The Administrator may
cause a legend or legends to be placed on any such certificates to make
appropriate reference to such restrictions or any other restrictions or
limitations that may be applicable to Shares.  In addition, during any period in
which Awards or Shares are subject to restrictions or limitations under the
terms of the Plan or any Award Agreement, the Administrator may require any
Participant to enter into an agreement providing that certificates representing
Shares issuable or issued pursuant to an Award shall remain in the physical
custody of the Corporation or such other Person as the Administrator may
designate.

 

7.07                        Payment for Awards.  To the extent required by
applicable law or as otherwise may be determined by the Administrator, the
Administrator may require a Participant to pay the fair market value of an Award
in exchange for the receipt of the Award.  Fair market value of an Award shall
be determined by the Administrator in good faith.

 

SECTION 8.                         ADJUSTMENT PROVISIONS

 

8.01                        If a dividend or other distribution shall be
declared upon the Common Stock payable in shares of the Common Stock, the number
of shares of Common Stock then subject to any outstanding Options, Performance
Awards or Other Stock Based Awards, the number of shares of Common Stock which
may be issued under the Plan but are not then subject to outstanding Options,
Performance Awards or Other Stock Based Awards and the maximum number of shares
as to which Options or Performance Awards may be granted and as to which shares
may be awarded under Sections 6.02(vi) and 6.04(v), shall be adjusted by adding
thereto the number of shares of Common Stock which would have been distributable
thereon if such shares had been outstanding on the date fixed for determining
the shareholders entitled to receive such stock dividend or distribution. 
Shares of Common Stock so distributed with respect to any Restricted Stock held
in escrow shall also be held by the Corporation in escrow and shall be subject
to the same restrictions as are applicable to the Restricted Stock on which they
were distributed.

 

If the outstanding shares of Common Stock shall be changed into or exchangeable
for a different number or kind of shares of stock or other securities of the
Corporation or

 

12

--------------------------------------------------------------------------------

 

another corporation, or cash or other property, whether through reorganization,
reclassification, recapitalization, stock split-up, combination of shares,
merger or consolidation, then there shall be substituted for each share of
Common Stock subject to any then outstanding Option, Performance Award or Other
Stock Based Award, and for each share of Common Stock which may be issued under
the Plan but which is not then subject to any outstanding Option, Performance
Award or Other Stock Based Award, the number and kind of shares of stock or
other securities (and in the case of outstanding Options, Performance Awards or
Other Stock Based Awards, the cash or other property) into which each
outstanding share of the Common Stock shall be so changed or for which each such
share shall be exchangeable.  Unless otherwise determined by the Administrator
in its discretion, any such stock or securities, as well as any cash or other
property, into or for which any Restricted Stock held in escrow shall be changed
or exchangeable in any such transaction shall also be held by the Corporation in
escrow and shall be subject to the same restrictions as are applicable to the
Restricted Stock in respect of which such stock, securities, cash or other
property was issued or distributed.

 

In case of any adjustment or substitution as provided for in this Section 8.01,
the aggregate option price for all Shares subject to each then outstanding
Option, Performance Award or Other Stock Based Award, prior to such adjustment
or substitution shall be the aggregate option price for all shares of stock or
other securities (including any fraction), cash or other property to which such
Shares shall have been adjusted or which shall have been substituted for such
Shares.  Any new option price per share or other unit shall be carried to at
least three decimal places with the last decimal place rounded upwards to the
nearest whole number.

 

If the outstanding shares of the Common Stock shall be changed in value by
reason of any spin-off, split-off or split-up, or dividend in partial
liquidation, dividend in property other than cash, or extraordinary distribution
to shareholders of the Common Stock, (a) the Administrator shall make any
adjustments to any then outstanding Option, Performance Award or Other Stock
Based Award, which it determines are equitably required to prevent dilution or
enlargement of the rights of optionees and awardees which would otherwise result
from any such transaction, and (b) unless otherwise determined by the
Administrator in its discretion, any stock, securities, cash or other property
distributed with respect to any Restricted Stock held in escrow or for which any
Restricted Stock held in escrow shall be exchanged in any such transaction shall
also be held by the Corporation in escrow and shall be subject to the same
restrictions as are applicable to the Restricted Stock in respect of which such
stock, securities, cash or other property was distributed or exchanged.

 

No adjustment or substitution provided for in this Section 8.01 shall require
the Corporation to issue or sell a fraction of a Share or other security. 
Accordingly, all fractional Shares or other securities which result from any
such adjustment or substitution shall be eliminated and not carried forward to
any subsequent adjustment or substitution.  Owners of Restricted Stock held in
escrow shall be treated in the same manner as owners of Common Stock not held in
escrow with respect to fractional Shares created by an adjustment or
substitution of Shares, except that, unless otherwise determined by the
Administrator in its discretion, any cash or other property paid in lieu of a
fractional

 

13

--------------------------------------------------------------------------------

 

Share shall be subject to restrictions similar to those applicable to the
Restricted Stock exchanged therefor. 

 

In the event of any other change in or conversion of the Common Stock, the
Administrator may in its discretion adjust the outstanding Awards and other
amounts provided in the Plan in order to prevent the dilution or enlargement of
rights of Participants.

 

SECTION 9.                         AMENDMENTS TO AND TERMINATION OF THE PLAN

 

9.01                        The Board may amend, alter, suspend, discontinue or
terminate the Plan without the consent of shareholders or Participants, except
that, without the approval of the shareholders of the Corporation, no amendment,
alteration, suspension, discontinuation or termination shall be made if
shareholder approval is required by any federal or state law or regulation or by
the rules of any stock exchange on which the Shares may then be listed, or if
the amendment, alteration or other change materially increases the benefits
accruing to Participants, increases the number of Shares available under the
Plan or modifies the requirements for participation under the Plan, or if the
Board in its discretion determines that obtaining such shareholder approval is
for any reason advisable; provided, however, that without the written consent of
the Participant, no amendment, alteration, suspension, discontinuation or
termination of the Plan may materially and adversely affect the rights of such
Participant under any Award theretofore granted to him.  The Administrator may,
consistent with the terms of the Plan, waive any conditions or rights under,
amend any terms of, or amend, alter, suspend, discontinue or terminate, any
Award theretofore granted, prospectively or retrospectively; provided, however,
that without the consent of a Participant, no amendment, alteration, suspension,
discontinuation or termination of any Award may materially and adversely affect
the rights of such Participant under any Award theretofore granted to him; and
provided further that, except as provided in Section 8.01 of the Plan, the
exercise price of any outstanding Option may not be reduced, whether through
amendment, cancellation or replacement, unless such reduction is approved by the
shareholders of the Corporation.

 

SECTION 10.                  GENERAL PROVISIONS

 

10.01                 No Right to Awards; No Shareholder Rights.  No Participant
shall have any claim to be granted any Award under the Plan, and there is no
obligation for uniformity of treatment of Participants, except as provided in
any other compensation, fee or other arrangement.  No Award shall confer on any
Participant any of the rights of a shareholder of the Corporation unless and
until Shares are in fact issued to such Participant in connection with such
Award.

 

10.02                 Withholding.  To the extent required by applicable
Federal, state, local or foreign law, the Participant or his successor shall
make arrangements satisfactory to the Corporation, in its discretion, for the
satisfaction of any withholding tax obligations that arise in connection with an
Award.  The Corporation shall not be required to issue any Shares or make any
other payment under the Plan until such obligations are satisfied.  The
Corporation is authorized to withhold from any Award granted or any payment due
under

 

14

--------------------------------------------------------------------------------

 

the Plan, including from a distribution of Shares, amounts of withholding taxes
due with respect to an Award, its exercise or any payment thereunder, and to
take such other action as the Administrator may deem necessary or advisable to
enable the Corporation and Participants to satisfy obligations for the payment
of such taxes.  This authority shall include authority to withhold or receive
Shares, Awards or other property and to make cash payments in respect thereof in
satisfaction of such tax obligations.

 

10.03                 No Right to Employment or Continuation of Service. 
Nothing contained in the Plan or any Award Agreement shall confer, and no grant
of an Award shall be construed as conferring, upon any Participant any right to
come into or to continue in the employ or service of the Employer Entity or the
Corporation or to interfere in any way with the right of the Employer Entity,
the Corporation or shareholders to terminate his employment or service at any
time or increase or decrease his compensation, fees, or other payments from the
rate in existence at the time of granting of an Award, except as provided in any
Award Agreement or other compensation, fee or other arrangement.

 

10.04                 Unfunded Status of Awards; Creation of Trusts.  The Plan
is intended to constitute an “unfunded” plan for incentive compensation.  With
respect to any payments not yet made to a Participant pursuant to an Award,
nothing contained in the Plan or any Award Agreement shall give any such
Participant any rights that are greater than those of a general unsecured
creditor of the Corporation; provided, however, that the Administrator may
authorize the creation of trusts or make other arrangements to meet the
Corporation’s obligations under the Plan to deliver Shares or other property
pursuant to any Award, which trusts or other arrangements shall be consistent
with the “unfunded” status of the Plan unless the Administrator otherwise
determines.

 

10.05                 No Limit on Other Compensatory Arrangements.  Nothing
contained in the Plan shall prevent the Corporation from adopting other or
additional compensation, fee or other arrangements (which may include, without
limitation, employment agreements with executives and arrangements which relate
to Awards under the Plan), and such arrangements may be either generally
applicable or applicable only in specific cases.  Notwithstanding anything in
the Plan to the contrary, the terms of each Award shall be construed so as to be
consistent with such other arrangements in effect at the time of the Award.

 

10.06                 No Fractional Shares.  No fractional Shares shall be
issued or delivered pursuant to the Plan or any Award.  The Administrator shall
determine whether cash, other Awards or other property shall be issued or paid
in lieu of fractional Shares or whether such fractional Shares or any rights
thereto shall be forfeited or otherwise eliminated.

 

10.07                 Governing Law.  The validity, interpretation, construction
and effect of the Plan and any rules and regulations relating to the Plan shall
be governed by the laws of the United States Virgin Islands (without regard to
the conflicts of laws thereof).

 

10.08                 Severability.  If any provision of the Plan or any Award
is or becomes or is deemed invalid, illegal or unenforceable in any
jurisdiction, or would disqualify the Plan or any Award under any law deemed
applicable by the Administrator, such provision shall be

 

15

--------------------------------------------------------------------------------

 

construed or deemed amended to conform to applicable laws or if it cannot be
construed or deemed amended without, in the determination of the Administrator,
materially altering the intent of the Plan or Award, it shall be deleted and the
remainder of the Plan or Award shall remain in full force and effect; provided,
however, that, unless otherwise determined by the Administrator, the provision
shall not be construed or deemed amended or deleted with respect to any
Participant whose rights and obligations under the Plan are not subject to the
law of such jurisdiction or the law deemed applicable by the Administrator.

 

SECTION 11.                  EFFECTIVE DATE AND TERM OF THE PLAN

 

11.01                 The effective date and date of adoption of the Plan shall
be December 21, 2012, the date of adoption of the Plan by the Board, provided
that such adoption of the Plan is approved by a majority of the votes cast at a
duly held meeting of shareholders at which a quorum representing a majority of
the outstanding voting stock of the Corporation is, either in person or by
proxy, present and voting.  Notwithstanding anything else contained in the Plan
or in any Award Agreement, no Option or other purchase right granted under the
Plan may be exercised, and no Shares may be distributed pursuant to any Award
granted under the Plan, prior to such shareholder approval.  In the event such
shareholder approval is not obtained, all Awards granted under the Plan shall
automatically be deemed void and of no effect.

 

16

--------------------------------------------------------------------------------