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Exhibit 10.1
 

 
GENCO SHIPPING & TRADING LIMITED
2012 EQUITY INCENTIVE PLAN
 
ARTICLE I
General
 
1.1  
Purpose

 
The Genco Shipping & Trading Limited 2012 Equity Incentive Plan (the “Plan”) is
designed to provide certain key persons, on whose initiative and efforts the
successful conduct of the business of Genco Shipping & Trading Limited (the
“Company”) depends, with incentives to: (a) enter into and remain in the service
of the Company (b) acquire a proprietary interest in the success of the Company,
(c) maximize their performance and (d) enhance the long-term performance of the
Company.
 
1.2  
Administration

 
(a)   Administration by Board of Directors.  The Plan shall be administered by
the Company’s Board of Directors (the “Board of Directors” or “Board”).  The
term “Administrator” shall refer to the Board or any committee or person to whom
the Board has delegated its authority pursuant to Section 1.2(c) hereof.  The
Administrator shall have the authority (i) to exercise all of the powers granted
to it under the Plan, (ii) to construe, interpret and implement the Plan and any
Award Agreements executed pursuant to Section 2.1, (iii) to prescribe, amend and
rescind rules and regulations relating to the Plan, including rules governing
its own operations, (iv) to make all determinations necessary or advisable in
administering the Plan, and (v) to correct any defect, supply any omission and
reconcile any inconsistency in the Plan.
 
(b)   Administrator Action.  Actions of the Administrator shall be taken by the
vote of a majority of its members.  Any action may be taken by a written
instrument signed by a majority of the Administrator members, and action so
taken shall be fully as effective as if it had been taken by a vote at a
meeting.  Except to the extent prohibited by applicable law or the applicable
rules of a stock exchange, the Administrator may allocate all or any portion of
its responsibilities and powers to any one or more of its members and may
delegate all or any part of its responsibilities to any person or persons
selected by it, and may revoke any such allocation or delegation at any time.
 
(c)   Deemed Delegation to Committee.  To the extent permitted by law and except
when the Company’s Board of Directors elects to act as the Administrator or to
delegate its responsibilities and powers to another person or persons, the Board
of Directors shall be deemed to have delegated its all of its responsibilities
and powers under the Plan, other than the authority to amend or terminate the
Plan, to the Compensation Committee of the Board of Directors or such other
committee or subcommittee as the Board may designate or as shall be formed by
the abstention or recusal of a non-Qualified Member (as defined below) of such
committee (the “Committee”).  The members of the Committee shall be appointed
by, and serve at the pleasure of, the Board of Directors.  While it is intended
that at all times that the Committee acts in connection with the Plan, the
Committee shall consist solely of Qualified Members, the number of whom shall
not be less than two, the fact that the Committee is not so comprised will not
invalidate any grant hereunder that otherwise satisfies the terms of the
Plan.  For purposes of the foregoing, a “Qualified Member” is a “non-employee
director” within the meaning of Rule 16b-3 promulgated under the Securities
Exchange Act of 1934 (the “1934 Act”).
 
(d)   Determinations Final.  The Administrator shall act in its sole discretion
with respect to all matters relating to the Plan and any Award Agreement, and
the determination of the Administrator on all such matters shall be final,
binding and conclusive.
 
(e)   Limit on Administrator’s Liability.  Neither the Administrator nor any
member of the Administrator shall be liable for any action or determination made
in good faith with respect to the Plan or any award thereunder.
 
 
 
 
 

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1.3  
Persons Eligible for Awards

 
The persons eligible to receive awards under the Plan are those officers,
directors, and executive, managerial, administrative and professional employees
of and consultants to the Company, (collectively, “key persons”) as the
Administrator shall select, taking into account the duties of the respective
employees, their present and potential contributions to the success of the
Company, and such other factors as the Administrator shall deem relevant in
connection with accomplishing the purpose of the Plan.  The Administrator may
from time to time, determine that any key person shall be ineligible to receive
awards under the Plan.
 
1.4  
Types of Awards Under Plan

 
Awards may be made under the Plan in the form of (a) incentive stock options,
(b) non-qualified stock options, (c) stock appreciation rights, (d) dividend
equivalent rights, (e) restricted stock, (f) unrestricted stock and
(g) restricted stock units, all as more fully set forth in Article II.  The term
“award” means any of the foregoing.  No incentive stock option may be granted to
a person who is not an employee of the Company on the date of grant.
 
1.5  
Shares Available for Awards

 
(a)   Subject to the provisions of Section 1.5(c), the aggregate number of
shares of common stock of the Company (“Common Stock”) with respect to which
awards may at any time be granted under the Plan are 3,000,000 shares of Common
Stock. 
 
(b)   Shares issued pursuant to the Plan may be authorized but unissued Common
Stock.  The Administrator may direct that any stock certificate evidencing
shares issued pursuant to the Plan shall bear a legend setting forth such
restrictions on transferability as may apply to such shares.
 
(c)   Adjustment Upon Changes in Common Stock.  Upon certain changes in Common
Stock, the number of shares of Common Stock available for issuance with respect
to awards that may be granted under the Plan pursuant to Section 1.5(a), shall
be adjusted pursuant to Section 3.7(a).
 
(d)   Certain Shares to Become Available Again.  The following shares of Common
Stock shall again become available for awards under the Plan: any shares that
are subject to an award under the Plan and that remain unissued upon the
cancellation or termination of such award for any reason whatsoever; any shares
of restricted stock forfeited pursuant to Section 2.7(e), provided that any
dividends paid on such shares are also forfeited pursuant to such
Section 2.7(e); and any shares in respect of which a stock appreciation right or
performance share award is settled for cash.
 
(e)   Individual Limit.  Except for the limits set forth in this
Section 1.5(e) and 2.2(i), no provision of this Plan shall be deemed to limit
the number or value of shares with respect to which the Administrator may make
awards to any eligible person.  Subject to adjustment as provided in
Section 3.7(a), the total number of shares of Common Stock with respect to which
awards may be granted to any one employee of the Company during any one calendar
year shall not exceed 600,000 shares.  Stock options and stock appreciation
rights granted and subsequently canceled or deemed to be canceled in a calendar
year count against this limit even after their cancellation.  The provisions of
this Section 1.(e) shall not apply in any circumstance with respect to which the
Administrator determines that compliance with Section 162(m) is not necessary.
 
1.6  
Definitions of Certain Terms

 
(a)   The term “cause” in connection with a termination of employment for cause
shall mean:
 
(i)   
with respect to a member of the Board, cause shall consist of those acts or
omissions that would constitute “cause” under the by-laws of the Company, as
they may be amended from time to time;

 
(ii)   
with respect to an employee or consultant, to the extent that there is an
employment, severance or other agreement governing the relationship between the
grantee and the Company, or the in the case of a member of the Board, which
agreement contains a definition of “cause,” cause shall consist of those acts or
omissions that would constitute “cause” under such agreement or document; and
otherwise,

 
 
 
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(iii)  
the grantee’s termination of employment by the Company or an affiliate on
account of any one or more of the following:

 
(A)   
any failure by the grantee substantially to perform the grantee’s employment or
other duties;

 
(B)   
any excessive unauthorized absenteeism by the grantee;

 
(C)   
any refusal by the grantee to obey the lawful orders of the Board or any other
person or Administrator to whom the grantee reports;

 
(D)   
any act or omission by the grantee that is or may be injurious to the Company,
monetarily or otherwise;

 
(E)   
any act by the grantee that is inconsistent with the best interests of the
Company;

 
(F)   
the grantee’s material violation of any of the Company’s policies, including,
without limitation, those policies relating to discrimination or sexual
harassment;
 

(G)   
the grantee’s unauthorized (a) removal from the premises of the Company or an
affiliate of any document (in any medium or form) relating to the Company or an
affiliate or the customers or clients of the Company or an affiliate or (b)
disclosure to any person or entity of any of the Company’s, or its affiliates’
confidential or proprietary information;

 
(H)
 
(I)   
the grantee’s commission of any felony, or any other crime involving moral
turpitude; and
 
the grantee’s commission of any act involving dishonesty or fraud.

 
Any rights the Company may have hereunder in respect of the events giving rise
to cause shall be in addition to the rights the Company may have under any other
agreement with a grantee or at law or in equity.  Any determination of whether a
grantee’s employment is (or is deemed to have been) terminated for cause shall
be made by the Administrator, which determination shall be final, binding and
conclusive on all parties.  If, subsequent to a grantee’s voluntary termination
of employment or involuntary termination of employment without cause, it is
discovered that the grantee’s employment could have been terminated for cause,
the Administrator may deem such grantee’s employment to have been terminated for
cause.  A grantee’s termination of employment for cause shall be effective as of
the date of the occurrence of the event giving rise to cause, regardless of when
the determination of cause is made.
 
(b)   The term “Code” means the Internal Revenue Code of 1986, as amended.
 
(c)   The terms “employment” and “employed” shall be deemed to mean an
employee’s employment with, or a consultant’s provision of services to, the
Company, and each Board member’s service as a Board member.
 
(d)   The “Fair Market Value” of a share of Common Stock on any day shall be the
closing price on the New York Stock Exchange, as reported for such day in The
Wall Street Journal or, if no such price is reported for such day, the average
of the high bid and low asked price of Common Stock as reported for such day. 
If no quotation is made for the applicable day, the Fair Market Value of a share
of Common Stock on such day shall be determined in the manner set forth in the
preceding sentence using quotations for the next preceding day for which there
were quotations, provided that such quotations shall have been made within the
ten (10) business days preceding the applicable day.  Notwithstanding the
foregoing, if deemed necessary or appropriate by the Administrator, the Fair
Market Value of a share of Common Stock on any day shall be determined by the
Administrator.  In no event shall the Fair Market Value of any share of Common
Stock be less than its par value.
 
 
 
 
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(e)   The term “incentive stock option” means an option that is intended to
qualify for special federal income tax treatment pursuant to sections 421 and
422 of the Code as now constituted or subsequently amended, or pursuant to a
successor provision of the Code, and which is so designated in the applicable
Award Agreement.  Any option that is not specifically designated as an incentive
stock option shall under no circumstances be considered an incentive stock
option.  Any option that is not an incentive stock option is referred to herein
as a “non-qualified stock option.”
 
(f)   A grantee shall be deemed to have terminated employment upon (i) the date
the grantee ceases to be employed by, or to provide consulting services for, the
Company or any corporation (or any of its subsidiaries) which assumes the
grantee’s award in a transaction to which section 424(a) of the Code applies (a
“424 Corporation”); or (ii) the date the grantee ceases to be a Board member or
the member of the board of directors of a 424 Corporation, provided, however,
that in the case of a grantee (x) who is, at the time of reference, both an
employee or consultant and a Board member, or (y) who ceases to be engaged as an
employee, consultant or Board member and immediately is engaged in another of
such relationships with the Company or a 424 Corporation, the grantee shall be
deemed to have a “termination of employment” upon the later of the dates
determined pursuant to subparagraphs (i) and (ii) above.  The Administrator may
determine whether any leave of absence constitutes a termination of employment
for purposes of the Plan and the impact, if any, of any such leave of absence on
awards theretofore made under the Plan.
 
ARTICLE II
Awards Under The Plan
 
2.1  
Agreements Evidencing Awards

 
Each award granted under the Plan (except an award of unrestricted stock) shall
be evidenced by a written certificate (“Award Agreement”) which shall contain
such provisions as the Administrator may deem necessary or desirable.  By
executing an Award Agreement pursuant to the Plan, a grantee thereby agrees that
the award shall be subject to all of the terms and provisions of the Plan and
the applicable Award Agreement.

2.2  
Grant of Stock Options, Stock Appreciation Rights and Dividend Equivalent Rights

 
(a)   Stock Option Grants.  The Administrator may grant incentive stock options
and non-qualified stock options (“options”) to purchase shares of Common Stock
from the Company, to such key persons, and in such amounts and subject to such
vesting and forfeiture provisions and other terms and conditions, as the
Administrator shall determine, subject to the provisions of the Plan.  The
Administrator may grant incentive stock options only to employees.
 
(b)   Stock Appreciation Right Grants; Types of Stock Appreciation Rights.  The
Administrator may grant stock appreciation rights to such key persons, and in
such amounts and subject to such vesting and forfeiture provisions and other
terms and conditions, as the Administrator shall determine, subject to the
provisions of the Plan.  The terms of a stock appreciation right may provide
that it shall be automatically exercised upon the happening of a specified event
that is outside the control of the grantee, and that it shall not be otherwise
exercisable.  Stock appreciation rights may be granted in connection with all or
any part of, or independently of, any option granted under the Plan.  A stock
appreciation right granted in connection with an option may be granted at or
after the time of grant of such option.
 
(c)   Nature of Stock Appreciation Rights.  The grantee of a stock appreciation
right shall have the right, subject to the terms of the Plan and the applicable
Award Agreement, to receive from the Company an amount equal to (i) the excess
of the Fair Market Value of a share of Common Stock on the date of exercise of
the stock appreciation right over an amount (the “stock appreciation right
exercise price”) determined by the Administrator, which may not be less than the
Fair Market Value of a share of Common Stock on the date of grant (or over the
option exercise price if the stock appreciation right is granted in connection
with an option), multiplied by (ii) the number of shares with respect to which
the stock appreciation right is exercised.  Payment upon exercise of a stock
appreciation right shall be in cash or in shares of Common Stock (valued at
their Fair Market Value on the date of exercise of the stock appreciation right)
or both, all as the Administrator shall determine.  Upon the exercise of a stock
appreciation right granted in connection with an option, the number of shares
subject to the option shall be reduced by the number of shares with respect to
which the stock appreciation right is exercised.  Upon the exercise of an option
in connection with which a stock appreciation right has been granted, the number
of shares subject to the stock appreciation right shall be reduced by the number
of shares with respect to which the option is exercised.
 
 
 
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(d)   Option Exercise Price.  Each Award Agreement with respect to an option
shall set forth the amount (the “option exercise price”) payable by the grantee
to the Company upon exercise of the option evidenced thereby.  The option
exercise price per share shall be determined by the Administrator; provided,
however, that the option exercise price of an incentive stock option shall be at
least 100% of the Fair Market Value of a share of Common Stock on the date the
option is granted, and provided further that in no event shall the option
exercise price be less than the par value of a share of Common Stock.
 
(e)   Exercise Period.  Each Award Agreement with respect to an option or stock
appreciation right shall set forth the periods during which the award evidenced
thereby shall be exercisable, whether in whole or in part.  Such periods shall
be determined by the Administrator; provided, however, that no option or a stock
appreciation right shall be exercisable more than 10 years after the date of
grant. (See Section 2.3 for additional provisions relating to the exercise of
options and stock appreciation rights.)
 
(f)   Reload Options.  The Administrator may, include in any Award Agreement
with respect to an option (the “original option”) a provision that an additional
option (the “reload option”) shall be granted to any grantee who, pursuant to
Section 2.3(c)(ii), delivers shares of Common Stock in partial or full payment
of the exercise price of the original option.  The reload option shall be for a
number of shares of Common Stock equal to the number thus delivered, shall have
an exercise price equal to the Fair Market Value of a share of Common Stock on
the date of exercise of the original option, and shall have an expiration date
no later than the expiration date of the original option.  In the event that a
Award Agreement provides for the grant of a reload option, such Agreement shall
also provide that the exercise price of the original option be no less than the
Fair Market Value of a share of Common Stock on its date of grant, and that any
shares that are delivered pursuant to Section 2.3(c)(ii) in payment of such
exercise price shall have been held for at least six months.
 
(g)   Incentive Stock Option Limitations.
 
(i)   
Exercisability.  To the extent that the aggregate Fair Market Value (determined
as of the time the option is granted) of the stock with respect to which
incentive stock options are first exercisable by any employee during any
calendar year shall exceed $100,000, or such higher amount as may be permitted
from time to time under section 422 of the Code, such options shall be treated
as non-qualified stock options.

 
(ii)   
10% Owners.  Notwithstanding the provisions of paragraphs (d) and (e) of this
Section 2.2, an incentive stock option may not be granted under the Plan to an
individual who, at the time the option is granted, owns stock possessing more
than 10% of the total combined voting power of all classes of stock of his
employer corporation or of its parent or subsidiary corporations (as such
ownership may be determined for purposes of section 422(b) (6) of the Code)
unless (i) at the time such incentive stock option is granted the option
exercise price is at least 110% of the Fair Market Value of the shares subject
thereto and (ii) the incentive stock option by its terms is not exercisable
after the expiration of 5 years from the date it is granted.

 
2.3  
Exercise of Options and Stock Appreciation Rights

 
Subject to the other provisions of this Article II, each option and stock
appreciation right granted under the Plan shall be exercisable as follows:
 
(a)   Timing and Extent of Exercise.  Unless the applicable Award Agreement
otherwise provides, (i) an option or stock appreciation right may be exercised
from time to time as to all or part of the shares as to which such award is then
exercisable and (ii) a stock appreciation right granted in connection with an
option may be exercised at any time when, and to the same extent that, the
related option may be exercised.
 
 
 
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(b)   Notice of Exercise.  An option or stock appreciation right shall be
exercised by the filing of a written notice with the Company or the Company’s
designated exchange agent (the “exchange agent”), on such form and in such
manner as the Administrator shall prescribe.
 
(c)   Payment of Exercise Price.  Any written notice of exercise of an option
shall be accompanied by payment for the shares being purchased.  Such payment
shall be made: (i) by certified or official bank check (or the equivalent
thereof acceptable to the Company or its exchange agent) for the full option
exercise price; or (ii) with the consent of the Administrator, by delivery of
shares of Common Stock having a Fair Market Value (determined as of the exercise
date) equal to all or part of the option exercise price and a certified or
official bank check (or the equivalent thereof acceptable to the Company or its
exchange agent) for any remaining portion of the full option exercise price; or
(iii) with the consent of the Administrator and to the extent permitted by law,
by such other provision, consistent with the terms of the Plan, as the
Administrator may from time to time prescribe (whether directly or indirectly
through the exchange agent).
 
(d)   Delivery of Certificates Upon Exercise.  Subject to the provision of
section 2.3(e), promptly after receiving payment of the full option exercise
price, or after receiving notice of the exercise of a stock appreciation right
for which payment will be made partly or entirely in shares, the Company or its
exchange agent shall, subject to the provisions of Section 3.2, deliver to the
grantee or to such other person as may then have the right to exercise the
award, a certificate or certificates for the shares of Common Stock for which
the award has been exercised.  If the method of payment employed upon option
exercise so requires, and if applicable law permits, an optionee may direct the
Company, or its exchange agent as the case may be, to deliver the stock
certificate(s) to the optionee’s stockbroker.
 
(e)   Investment Purpose and Legal Requirements.  Notwithstanding the foregoing,
at the time of the exercise of any option, the Company may, if it shall deem it
necessary or advisable for any reason, require the holder of such option (i) to
represent in writing to the Company that it is the optionee’s then intention to
acquire the Shares with respect to which the option is to be exercised for
investment and not with a view to the distribution thereof, or (ii) to postpone
the date of exercise until such time as the Company has available for delivery
to the optionee a prospectus meeting the requirements of all applicable
securities laws; and no shares shall be issued or transferred upon the exercise
of any option unless and until all legal requirements applicable to the issuance
or transfer of such Shares have been complied with to the satisfaction of the
Company.  The Company shall have the right to condition any issuance of shares
to any optionee hereunder on such optionee’s undertaking in writing to comply
with such restrictions on the subsequent transfer of such shares as the Company
shall deem necessary or advisable as a result of any applicable law, regulation
or official interpretation thereof, and certificates representing such shares
may contain a legend to reflect any such restrictions.
 
(f)   No Stockholder Rights.  No grantee of an option or stock appreciation
right (or other person having the right to exercise such award) shall have any
of the rights of a stockholder of the Company with respect to shares subject to
such award until the issuance of a stock certificate to such person for such
shares.  Except as otherwise provided in Section 1.5(c), no adjustment shall be
made for dividends, distributions or other rights (whether ordinary or
extraordinary, and whether in cash, securities or other property) for which the
record date is prior to the date such stock certificate is issued.
 
2.4  
Compensation in Lieu of Exercise of an Option

 
Upon written application of the grantee of an option, the Administrator may
determine to substitute, for the exercise of such option, compensation to the
grantee not in excess of the difference between the option exercise price and
the Fair Market Value of the shares covered by such written application on the
date of such application.  Such compensation may be in cash, in shares of Common
Stock, or both, and the payment thereof may be subject to conditions, all as the
Administrator shall determine.  In the event compensation is substituted
pursuant to this Section 2.4 for the exercise, in whole or in part, of an
option, the number of shares subject to the option shall be reduced by the
number of shares for which such compensation is substituted.
 
 
 
 
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2.5  
Termination of Employment

 
(a)   General Rule.  Except to the extent otherwise provided herein, including
in paragraphs (b), (c), (d) or (e) of this Section 2.5 and Section 3.8(b)(iii)
or by the Administrator in an Award Agreement or otherwise, a grantee whose
employment terminates may exercise any outstanding option or stock appreciation
right on the following terms and conditions: (i) exercise may be made only to
the extent that the grantee was entitled to exercise the award on the
termination of employment date; and (ii) exercise must occur within three months
after termination of employment but in no event after the original expiration
date of the award.
 
(b)   Termination for Cause; Resignation.  If a grantee’s employment is
terminated for cause or if a grantee resigns without the Company’s prior
consent, all options and stock appreciation rights not theretofore exercised
shall terminate upon the commencement of business on the date of the grantee’s
termination of employment.
 
(c)   Retirement.  If a grantee terminates employment as the result of his
retirement, then any outstanding option or stock appreciation right shall
continue to be exercisable pursuant to its terms, without any earlier expiration
of the award.  For this purpose “retirement” shall mean a grantee’s termination
of employment, under circumstances other than those described in paragraph
(b) above, on or after: (x) his 65th birthday, (y) the date on which he has
attained age 60 and completed at least five years of service with the Company,
as applicable, (using any method of calculation the Administrator deems
appropriate) or (z) if approved by the Administrator, on or after he has
completed at least 20 years of service.
 
(d)   Disability.  If a grantee’s employment is terminated due to disability (as
defined below), then any outstanding option or stock appreciation right shall
continue to be exercisable pursuant to its terms, without any earlier expiration
of the award.  For this purpose “disability” shall mean any physical or mental
condition that would qualify a grantee for a disability benefit under the
long-term disability plan maintained by the Company, if there is no such plan, a
physical or mental condition that prevents the grantee from performing the
essential functions of the grantee’s position (with or without reasonable
accommodation) for a period of six consecutive months.  The existence of a
disability shall be determined by the Administrator.
 
(e)   Death.
 
(i)   
Termination of Employment as a Result of Grantee’s Death.  If a grantee’s
employment terminates due to his death, then any outstanding option or stock
appreciation right shall continue to be exercisable pursuant to its terms,
without any earlier expiration of the award.

 
(ii)   
Restrictions on Exercise Following Death.  Any such exercise of an award
following a grantee’s death shall be made only by the grantee’s executor or
administrator or other duly appointed representative reasonably acceptable to
the Administrator, unless the grantee’s will specifically disposes of such
award, in which case such exercise shall be made only by the recipient of such
specific disposition.  If a grantee’s personal representative or the recipient
of a specific disposition under the grantee’s will shall be entitled to exercise
any award pursuant to the preceding sentence, such representative or recipient
shall be bound by all the terms and conditions of the Plan and the applicable
Award Agreement which would have applied to the grantee including, without
limitation, the provisions of Sections 3.2 and 3.5 hereof.

 
(f)   Special Rules for Incentive Stock Options.  No option that remains
exercisable for more than three months following a grantee’s termination of
employment for any reason other than death (including death within three months
after termination of employment or within one year after a termination of
employment due to disability) or disability, or for more than one year following
a grantee’s termination of employment as the result of his becoming disabled,
may be treated as an incentive stock option.
 
 
 
 
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2.6  
Transferability of Options, Stock Appreciation Rights and Restricted Stock Units

 
Except as otherwise provided by the Administrator, in an applicable Award
Agreement or otherwise, during the lifetime of a grantee, each option or stock
appreciation right granted to a grantee shall be exercisable only by the grantee
and no option, stock appreciation right shall be assignable or transferable
otherwise than by will or by the laws of descent and distribution.  The
Administrator may, in any applicable Award Agreement evidencing an option or
otherwise (other than an incentive stock option to the extent inconsistent with
the requirements of section 422 of the Code applicable to incentive stock
options) or stock appreciation right, permit a grantee to transfer all or some
of the options or stock appreciation rights, as applicable, to (A) the grantee’s
spouse, children or grandchildren (“Immediate Family Members”), (B) a trust or
trusts for the exclusive benefit of such Immediate Family Members, or (C) other
parties approved by the Administrator, provided, however, that no such transfer
may be for consideration.  Following any such transfer, any transferred options
and stock appreciation rights shall continue to be subject to the same terms and
conditions as were applicable immediately prior to the transfer.
 
2.7  
Grant of Restricted Stock

 
(a)   Restricted Stock Grants.  The Administrator may grant restricted shares of
Common Stock to such key persons, in such amounts, and subject to such vesting
and forfeiture provisions and other terms and conditions as the Administrator
shall determine, subject to the provisions of the Plan.  Restricted stock awards
may be made independently of or in connection with any other award under the
Plan.  A grantee of a restricted stock award shall have no rights with respect
to such award unless such grantee accepts the award within such period as the
Administrator shall specify by accepting delivery of an Award Agreement in such
form as the Administrator shall determine and, in the event the restricted
shares are newly issued by the Company, makes payment to the Company or its
exchange agent as required by the Administrator and in accordance with the
Marshall Islands Business Corporations Act.
 
(b)   Issuance of Stock Certificate(s).  Promptly after a grantee accepts a
restricted stock award, the Company or its exchange agent shall issue to the
grantee a stock certificate or stock certificates for the shares of Common Stock
covered by the award or shall establish an account evidencing ownership of the
stock in uncertificated form.  Upon the issuance of such stock certificate(s),
or establishment of such account, the grantee shall have the rights of a
stockholder with respect to the restricted stock, subject to: (i) the
nontransferability restrictions and forfeiture provision described in paragraphs
(d) and (e) of this Section 2.7; (ii) if so directed by the Administrator, a
requirement that any dividends paid on such shares shall be held in escrow until
all restrictions on such shares have lapsed; and (iii) any other restrictions
and conditions contained in the applicable Award Agreement.
 
(c)   Custody of Stock Certificate(s).  Unless the Administrator shall otherwise
determine, any stock certificates issued evidencing shares of restricted stock
shall remain in the possession of the Company until such shares are free of any
restrictions specified in the applicable restricted stock agreement.  The
Administrator may direct that such stock certificate(s) bear a legend setting
forth the applicable restrictions on transferability.
 
(d)   Vesting/Nontransferability.  Until they vest, shares of restricted stock
may not be sold, assigned, transferred, pledged or otherwise encumbered or
disposed of except as otherwise specifically provided in this Plan or the
applicable Award Agreement.  The Administrator at the time of grant shall
specify the date or dates (which may depend upon or be related to the
achievement of performance goals and other conditions) on which the
nontransferability of the restricted stock shall lapse.
 
(e)   Consequence of Termination of Employment.  Except as may otherwise be
provided by the Administrator in the applicable Award Agreement or otherwise, a
grantee’s termination of employment for any reason shall cause the immediate
forfeiture of all shares of restricted stock that have not yet vested as of the
date of such termination of employment.  All dividends paid on such shares also
shall be forfeited, whether by termination of any escrow arrangement under which
such dividends are held, by the grantee’s repayment of dividends he received
directly, or otherwise, unless the Administrator determines otherwise in the
applicable Award Agreement or otherwise.
 
 
 
 
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2.8 Grant of Restricted Stock Units
 
(a)   Restricted Stock Unit Grants. The Administrator may grant awards of
restricted stock units to such key persons, in such amounts, and subject to such
terms and conditions as the Administrator shall determine, subject to the
provisions of the Plan.  Restricted stock units may be awarded independently of
or in connection with any other award under the Plan.  A grantee of a restricted
stock unit award shall have no rights with respect to such award unless such
grantee accepts the award within such period as the Administrator shall specify
by accepting delivery of an Award Agreement in such form as the Administrator
shall determine.  A grant of a restricted stock unit entitles the grantee to
receive a share of Common Stock or, in the sole discretion of the Administrator,
the value of a share, on a date specified in the Award Agreement.  If no date is
specified, the grantee shall receive such share or value on the date that the
restricted stock unit vests.
 
(b)   Vesting/Nontransferability.  Until they vest, restricted stock units may
not be sold, assigned, transferred, pledged or otherwise encumbered or disposed
of except as otherwise specifically provided in this Plan or the applicable
Award Agreement.  The Administrator at the time of grant shall specify the date
or dates (which may depend upon or be related to a period of continued
employment with the Company, the achievement of performance goals or other
conditions or a combination of such conditions) on which the restricted stock
units shall vest.
 
(c)   Consequence of Termination of Employment.  Except as may otherwise be
provided by the Administrator at any time, a grantee’s termination of employment
for any reason (including death) shall cause the immediate forfeiture of all
restricted stock units that have not yet vested as of the date of such
termination of employment.
 
(d)   Stockholder Rights.  The grantee of a restricted stock unit will have the
rights of a stockholder only as to shares for which a stock certificate has been
issued pursuant to the award and not with respect to any other shares subject to
the award.
 
2.9  
Grant of Unrestricted Stock

 
The Administrator may grant (or sell at a purchase price at least equal to par
value) shares of Common Stock free of restrictions under the Plan, to such key
persons and in such amounts and subject to such forfeiture provisions and other
terms and conditions as the Administrator may determine.  Shares may be thus
granted or sold in respect of past services or other valid consideration.
 
2.10  
Dividend Equivalent Rights

 
The Administrator may include in any Award Agreement with respect to an option,
stock appreciation right or restricted stock unit, a dividend equivalent right
entitling the grantee to receive amounts equal to the ordinary dividends that
would be paid, during the time such award is outstanding and unexercised, on the
shares of Common Stock covered by such award if such shares were then
outstanding. In the event such a provision is included in a Award Agreement, the
Administrator shall determine whether such payments shall be made in cash or in
shares of Common Stock, whether they shall be conditioned upon the exercise of
the award to which they relate (in the case of options and stock appreciation
rights), the time or times at which they shall be made, and such other vesting
and forfeiture provisions and other terms and conditions as the Administrator
shall deem appropriate.
 
ARTICLE III
Miscellaneous
 
3.1  
Amendment of the Plan; Modification of Awards

 
(a)   Amendment of the Plan.  Subject to Section 3.1(b), the Board may from time
to time suspend, discontinue, revise or amend the Plan in any respect
whatsoever, except that no such amendment shall materially impair any rights or
materially increase any obligations of the grantee under any award theretofore
made under the Plan without the consent of the grantee (or, upon the grantee’s
death, the person having the right to exercise the award).  For purposes of this
Section 3.1, any action of the Board or the Administrator that in any way alters
or affects the tax treatment of any award or that the Board determines is
necessary to prevent an award from being subject to tax under Section 409A of
the Code shall not be considered to materially impair any rights of any grantee.
 
 
 
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(b)   Stockholder Approval Requirement.  Stockholder approval shall be required
with respect to any amendment to the Plan that (i) increases the aggregate
number of shares that may be issued pursuant to incentive stock options or
changes the class of employees eligible to receive such options; (ii) materially
increases the benefits under the Plan to persons whose transactions in Common
Stock are subject to section 16(b) of the 1934 Act or increases the benefits
under the Plan or materially increases the number of shares which may be issued
to such persons, or materially modifies the eligibility requirements affecting
such persons, (iii) to the extent required by applicable stock exchange rules,
or (iv) to the extent the Board determines that stockholder approval is
appropriate and necessary to enable awards under the Plan to comply with
Sections 422 or 162(m) of the Code.
 
(c)   Modification of Awards.  The Administrator may cancel any award under the
Plan.  The Administrator also may amend any outstanding Award Agreement,
including, without limitation, by amendment which would: (i) accelerate the time
or times at which the award becomes unrestricted or may be exercised; (ii) waive
or amend any goals, restrictions or conditions set forth in the Agreement; or
(iii) waive or amend the operation of Section 2.5 with respect to the
termination of the award upon termination of employment, provided however, that
the Committee may not (w) lower the exercise price of an outstanding option or
stock appreciation right, (x) cancel an option or stock appreciation right in
exchange for a new option or stock appreciation right with a lower exercise
price, (y) cancel an option or stock appreciation right in exchange for a
different type of award under the Plan that has a value that is greater than the
excess of the fair market value of the applicable shares on the date of such
payment over the exercise price or (z) authorize the payment of cash in lieu of
the exercise of an option or stock appreciation right in an amount that is
greater than the excess of the fair market value of the applicable shares on the
date of such payment over the exercise price.  However, any such cancellation or
amendment (other than an amendment pursuant to Sections 3.7 or 3.8(b)) that
materially impairs the rights or materially increases the obligations of a
grantee under an outstanding award shall be made only with the consent of the
grantee (or, upon the grantee’s death, the person having the right to exercise
the award).
 
3.2  
Consent Requirement

 
(a)   No Plan Action Without Required Consent.  If the Administrator shall at
any time determine that any Consent (as hereinafter defined) is necessary or
desirable as a condition of, or in connection with, the granting of any award
under the Plan, the issuance or purchase of shares or other rights thereunder,
or the taking of any other action thereunder (each such action being hereinafter
referred to as a “Plan Action”), then such Plan Action shall not be taken, in
whole or in part, unless and until such Consent shall have been effected or
obtained to the full satisfaction of the Administrator.
 
(b)   Consent Defined.  The term “Consent” as used herein with respect to any
Plan Action means (i) any and all listing on any securities exchange or any
registrations or qualifications under any federal, state or local law, rule or
regulation, (ii) any and all written agreements and representations by the
grantee with respect to the disposition of shares, or with respect to any other
matter, which the Administrator shall deem necessary or desirable to comply with
the terms of any such listing, registration or qualification or to obtain an
exemption from the requirement that any such listing, qualification or
registration be made and (iii) any and all consents, clearances and approvals in
respect of a Plan Action by any governmental or other regulatory bodies.
 
3.3  
Nonassignability

 
Except as otherwise provided herein, (a) no award or right granted to any person
under the Plan or under any Award Agreement shall be assignable or transferable
other than by will or by the laws of descent and distribution; and (b) all
rights granted under the Plan or any Award Agreement shall be exercisable during
the life of the grantee only by the grantee or the grantee’s legal
representative.
 
 
 
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3.4  
Requirement of Notification of Election Under Section 83(b) of the Code

 
If any grantee shall, in connection with the acquisition of shares of Common
Stock under the Plan, make the election permitted under section 83(b) of the
Code (i.e., an election to include in gross income in the year of transfer the
amounts specified in section 83(b)), such grantee shall notify the Company of
such election within 10 days of filing notice of the election with the Internal
Revenue Service, in addition to any filing and notification required pursuant to
regulations issued under the authority of Code section 83(b).
 
3.5  
Requirement of Notification Upon Disqualifying Disposition Under
Section 421(b) of the Code

 
Each grantee of an incentive stock option shall notify the Company of any
disposition of shares of Common Stock issued pursuant to the exercise of such
option under the circumstances described in section 421(b) of the Code (relating
to certain disqualifying dispositions), within 10 days of such disposition.
 
3.6  
Withholding Taxes

 
(a)   With Respect to Cash Payments.  Whenever cash is to be paid pursuant to an
award under the Plan, the Company shall be entitled to deduct therefrom an
amount sufficient in its opinion to satisfy all federal, state and other
governmental tax withholding requirements related to such payment.
 
(b)   With Respect to Delivery of Common Stock.  Whenever shares of Common Stock
are to be delivered pursuant to an award under the Plan, the Company shall be
entitled to require as a condition of delivery that the grantee remit to the
Company an amount sufficient in the opinion of the Company to satisfy all
federal, state and other governmental tax withholding requirements related
thereto.  With the approval of the Administrator, the grantee may satisfy the
foregoing condition by electing to have the Company withhold from delivery
shares having a value equal to the amount of tax to be withheld. Such shares
shall be valued at their Fair Market Value as of the date on which the amount of
tax to be withheld is determined. Fractional share amounts shall be settled in
cash.  Such a withholding election may be made with respect to all or any
portion of the shares to be delivered pursuant to an award.
 
3.7  
Adjustment Upon Changes in Common Stock

 
(a)   Corporate Events.  In the event of any change in the number of shares of
Common Stock outstanding by reason of any stock dividend or split, reverse stock
split, recapitalization, merger, consolidation, combination or exchange of
shares or similar corporate change (collectively referred to as “corporate
events”), the Administrator shall make the following adjustments, subject to
Sections 3.7(b) and (c):
 
(i)   
Shares Available for Grants.  The maximum number of shares of Common Stock with
respect to which the Administrator may grant awards under Article II hereof, as
described in Section 1.5(a), and the individual annual limit described in
Section 1.5(e), shall be appropriately adjusted by the Administrator.

 
(ii)   
Restricted Stock.  Unless the Administrator otherwise determines, any securities
or other property (including dividends paid in cash) received by a grantee with
respect to a share of restricted stock as a result of a corporate event will not
vest until such share of restricted stock vests, and shall be promptly deposited
with the Company or another custodian designated by the Company.

 
(iii)   
Restricted Stock Units.  The Administrator shall adjust outstanding grants of
shares of restricted stock units to reflect any corporate event as the
Administrator may deem appropriate to prevent the enlargement or dilution of
rights of grantees.

 
(iv)   
Options, Stock Appreciation Rights and Dividend Equivalent Rights.  Subject to
any required action by the stockholders of the Company, in the event of any
increase or decrease in the number of issued shares of Common Stock or a change
in the class of shares of Common Stock resulting from a corporate event, the
Administrator shall proportionally adjust the number or class of shares of
Common Stock subject to each outstanding option and stock appreciation right,
the exercise price-per-share of Common Stock of each such option and stock
appreciation right and the number of any related dividend equivalent rights.

 
 
 
 
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(b)   Outstanding Options, Stock Appreciation Rights, Restricted Stock Units and
Dividend Equivalent Rights – Certain Mergers.  Subject to any required action by
the stockholders of the Company, in the event that the Company shall be the
surviving corporation in any merger or consolidation (except a merger or
consolidation as a result of which the holders of shares of Common Stock receive
securities of another corporation and/or other property, including cash), each
option, stock appreciation right, restricted stock unit and dividend equivalent
right outstanding on the date of such merger or consolidation shall pertain to
and apply to the securities which a holder of the number of shares of Common
Stock subject to such option, stock appreciation right, restricted stock unit or
dividend equivalent right would have received in such merger or consolidation.
 
(c)   Outstanding Options, Stock Appreciation Rights, Restricted Stock Units and
Dividend Equivalent Rights – Certain Other Transactions.  In the event of (i) a
dissolution or liquidation of the Company, (ii) a sale of all or substantially
all of the Company’s assets, (iii) a merger or consolidation involving the
Company in which the Company is not the surviving corporation or (iv) a merger
or consolidation involving the Company in which the Company is the surviving
corporation but the holders of shares of Common Stock receive securities of
another corporation and/or other property, including cash, the Administrator
shall have the power to:
 
(i)   
cancel, effective immediately prior to the occurrence of such event, each
option, stock appreciation right and restricted stock unit (including each
dividend equivalent right related thereto) outstanding immediately prior to such
event (whether or not then exercisable), and, in full consideration of such
cancellation, pay to the grantee (A) to whom such option or stock appreciation
right was granted, for each share of Common Stock subject to such option or
stock appreciation right, respectively, an amount equal to the excess of (x) the
value, as determined by the Administrator, of the property (including cash)
received by the holder of a share of Common Stock as a result of such event over
(y) the exercise price of such option or stock appreciation right and (B) to
whom such restricted stock unit was granted, for each share of Common Stock
subject to such award, the value, as determined by the Administrator, of the
property (including cash) received by the holder of a share of Common Stock as a
result of such event;

 
(ii)   
provide that each option and stock appreciation right outstanding immediately
prior to such event (whether or not otherwise exercisable) (a) may be exercised
a period of not less than 30 days prior to the occurrence of such event and (b)
shall expire upon the occurrence of such event and cancel, effective immediately
prior to the occurrence of such event, each restricted stock unit (including
each dividend equivalent right related thereto) outstanding immediately prior to
such event (whether or not then vested), and, in full consideration of such
cancellation, pay to the grantee to whom such restricted stock unit was granted,
for each share of Common Stock subject to such award, the value, as determined
by the Administrator, of the property (including cash) received by the holder of
a share of Common Stock as a result of such event; or

 
(iii)   
provide for the exchange of each option, stock appreciation right and restricted
stock unit (including any related dividend equivalent right) outstanding
immediately prior to such event (whether or not then exercisable) for an option
on, stock appreciation right, restricted stock unit and dividend equivalent
right with respect to, as appropriate, some or all of the property which a
holder of the number of shares of Common Stock subject to such option, stock
appreciation right or restricted stock unit would have received and, incident
thereto, make an equitable adjustment as determined by the Administrator in the
exercise price of the option or stock appreciation right, or the number of
shares or amount of property subject to the option, stock appreciation right,
restricted stock unit or dividend equivalent right or, if the Administrator so
determines, provide for a payment to the grantee to whom such option, stock
appreciation right or restricted stock unit was granted in partial consideration
for the exchange of the option, stock appreciation right or restricted stock
unit.

 
 
 
 
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Any payments to  be made by the Company pursuant to the foregoing paragraphs
(i), (ii) and (iii) shall be made in cash or such other property as shall be
received by a holder of Common Stock as a result of such event.
 
(d)   Outstanding Options, Stock Appreciation Rights, Restricted Stock Units and
Dividend Equivalent Rights – Other Changes.  In the event of any change in the
capitalization of the Company or a corporate change other than those
specifically referred to in Sections 3.7(a), (b) or (c) hereof, the
Administrator may make such adjustments in the number and class of shares or
other property subject to options, stock appreciation rights, restricted stock
units and dividend equivalent rights outstanding on the date on which such
change occurs and in the per-share exercise price of each such option and stock
appreciation right as the Administrator may consider appropriate to prevent
dilution or enlargement of rights.  In addition, if and to the extent the
Administrator determines it is appropriate, the Administrator may elect to
cancel each or any option, stock appreciation right and restricted stock unit
(including each dividend equivalent right related thereto) outstanding
immediately prior to such event (whether or not then exercisable), and, in full
consideration of such cancellation, pay to the grantee to whom such award was
granted an amount in cash or such other property as shall be received by a
holder of Common Stock as a result of such event, (A) for each share of Common
Stock subject to such option or stock appreciation right, respectively, equal to
the excess of (i) the Fair Market Value of Common Stock on the date of such
cancellation over (ii) the exercise price of such option or stock appreciation
right (B) for each share of Common Stock subject to such restricted stock unit
equal to the Fair Market Value of Common Stock on the date of such cancellation.
 
(e)   No Other Rights. Except as expressly provided in the Plan, no grantee
shall have any rights by reason of any subdivision or consolidation of shares of
stock of any class, the payment of any dividend, any increase or decrease in the
number of shares of stock of any class or any dissolution, liquidation, merger
or consolidation of the Company or any other corporation. Except as expressly
provided in the Plan, no issuance by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall
affect, and no adjustment by reason thereof shall be made with respect to, the
number of shares of Common Stock subject to an award or the exercise price of
any option or stock appreciation right.
 
3.8  
Change in Control

 
(a)   Change in Control Defined.  For purposes of this Section 3.8, “Change in
Control” shall mean the occurrence of any of the following:
 
(i)   
any person or “group” (within the meaning of Section 13(d)(3) of the 1934 Act),
other than Oaktree Capital Management, LLC and its related entities or Peter C.
Georgiopoulos, acquiring “beneficial ownership” (as defined in Rule 13d-3 under
the 1934 Act), directly or indirectly, of fifty percent (50%) or more of the
aggregate voting power of the capital stock ordinarily entitled to elect
directors of the Company;

 
(ii)   
the sale of all or substantially all of the Company’s assets in one or more
related transactions to a person other than such a sale to a subsidiary of the
Company which does not involve a change in the equity holdings of the Company or
to an entity which Oaktree Capital Management, LLC or Peter C. Georgiopoulos
directly or indirectly controls; or

 
(iii)   
any merger, consolidation, reorganization or similar event of the Company or any
of its subsidiaries, as a result of which the holders of the voting stock of the
Company immediately prior to such merger, consolidation, reorganization or
similar event do not directly or indirectly hold at least fifty-one percent
(51%) of the aggregate voting power of the capital stock of the surviving
entity.

 
Notwithstanding the foregoing, for each award subject to Section 409A of the
Code, a Change in Control shall be deemed to occur under this Plan with respect
to such Award only if a change in the ownership or effective control of the
Company or a change in the ownership of a substantial portion of the assets of
the Company shall also be deemed to have occurred under Section 409A of the
Code.
 
 
 
 
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(b)   Effect of a Change in Control.  Unless the Administrator provides
otherwise in a Award Agreement, upon the occurrence of a Change in Control:
 
(i)   
notwithstanding any other provision of this Plan, any award then outstanding
shall become fully vested and any award in the form of an option or stock
appreciation right shall be immediately exercisable;

 
(ii)   
to the extent permitted by law, the Administrator may amend any Award Agreement
in such manner as it deems appropriate;

 
(iii)   
a grantee whose employment terminates for any reason, other than for cause,
concurrent with or within one year following the Change in Control may exercise
any outstanding option or stock appreciation right, but only to the extent that
the grantee was entitled to exercise the award on his termination of employment
date, until the earlier of (A) the original expiration date of the award and (B)
the later of (x) the date provided for under the terms of Section 2.5 without
reference to this Section 3.8(b)(iii) and (y) the first anniversary of the
grantee’s termination of employment.

 
(c)   Miscellaneous.  Whenever deemed appropriate by the Administrator, any
action referred to in paragraph (b)(ii) of this Section 3.8 may be made
conditional upon the consummation of the applicable Change in Control
transaction.
 
3.9  
Right of Discharge Reserved

 
Nothing in the Plan or in any Award Agreement shall (i) confer upon any grantee
the right to continue his employment with the Company, (ii) affect any right
that the Company may have to terminate such employment, or (iii) be deemed to
determine an individual’s status as an employee or consultant.
 
3.10  
Non-Uniform Determinations

 
The Administrator’s determinations under the Plan need not be uniform and may be
made by it selectively among persons who receive, or who are eligible to
receive, awards under the Plan (whether or not such persons are similarly
situated).  Without limiting the generality of the foregoing, the Administrator
shall be entitled, among other things, to make non-uniform and selective
determinations, and to enter into non-uniform and selective Award Agreements, as
to (a) the persons to receive awards under the Plan, and (b) the terms and
provisions of awards under the Plan.
 
3.11  
Other Payments or Awards

 
Nothing contained in the Plan shall be deemed in any way to limit or restrict
the Company from making any award or payment to any person under any other plan,
arrangement or understanding, whether now existing or hereafter in effect.
 
3.12  
Headings

 
Any section, subsection, paragraph or other subdivision headings contained
herein are for the purpose of convenience only and are not intended to expand,
limit or otherwise define the contents of such subdivisions.
 
3.13  
Effective Date and Term of Plan

 
(a)   Adoption; Stockholder Approval.  The Plan was adopted by the Board on
March 27, 2012, subject to approval by the Company’s shareholders.  All awards
under the Plan prior to such shareholder approval are subject in their entirety
to such approval.  If such approval is not obtained prior to the first
anniversary of the adoption of the Plan, the Plan and all awards thereunder
shall terminate on that date.
 
 
 
 
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(b)   Termination of Plan.  Unless sooner terminated by the Board or pursuant to
Paragraph (a) above, the provisions of the Plan respecting the grant of
incentive stock options shall terminate on the tenth anniversary of the adoption
of the Plan by the Board, and no incentive stock option awards shall thereafter
be made under the Plan.  All such awards made under the Plan prior to its
termination shall remain in effect until such awards have been satisfied or
terminated in accordance with the terms and provisions of the Plan and the
applicable Award Agreements.
 
3.14  
Restriction on Issuance of Stock Pursuant to Awards

 
The Company shall not permit any shares of Common Stock to be issued pursuant to
Awards granted under the Plan unless such shares of Common Stock are fully paid
and non-assessable under applicable law.
 
3.15  
Governing Law

 
Except to the extent preempted by any applicable federal law, the Plan will be
construed and administered in accordance with the laws of the State of New York,
without giving effect to principles of conflict of laws.
 
3.16  
Deferred Compensation

 
The Plan is intended to comply with the requirements of Section 409A of the Code
so as not to be subject to tax under Section 409A, and shall be interpreted
accordingly.  Notwithstanding anything else herein to the contrary, any payment
scheduled to be made to the grantee after the grantee’s termination of
employment shall not be made until the date six months after the date of the
termination of employment to the extent necessary to comply with Section
409A(a)(2)(B)(i) and applicable Treasury Regulations.  Following any such
six-month delay, all such delayed payments will be paid in a single lump sum on
the date six months after such termination of employment.
 
 
 
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