Exhibit 10.15

 

AMENDED AND RESTATED CABLE ONE, INC.

 2015 OMNIBUS INCENTIVE COMPENSATION PLAN

 

SECTION 1. Purpose. This Amended and Restated Cable One, Inc. 2015 Omnibus
Incentive Compensation Plan (the “Plan”) is intended to promote the interests of
the Company and its stockholders by providing the employees, directors and
consultants of the Company and its Subsidiaries with incentives and rewards to
encourage them to continue in the service of the Company and its Subsidiaries
and with a proprietary interest in pursuing the long-term growth, profitability
and financial success of the Company. This Plan is intended to replace the Prior
Plan (as defined below), which Prior Plan shall be automatically terminated and
replaced and superseded by this Plan on the Effective Date (as defined below).
Notwithstanding the foregoing, any awards granted under the Prior Plan shall
remain in effect pursuant to their respective terms.

 

SECTION 2. Definitions. As used herein, the following terms shall have the
meanings set forth below:

 

“Affiliate” means (a) any entity that, directly or indirectly, is controlled by,
controls or is under common control with, the Company and/or (b) any entity in
which the Company has a significant equity interest, in either case as
determined by the Committee.

 

“Award” means any award that is permitted under Section 6 and granted under the
Plan or the Prior Plan.

 

“Applicable Exchange” means the New York Stock Exchange or any other national
stock exchange or quotation system on which the Shares may be listed or quoted.

 

“Award Agreement” means any written or electronic agreement, contract or other
instrument or document evidencing any Award, which may (but need not) require
execution or acknowledgment by a Participant.

 

“Board” means the Board of Directors of the Company.

 

“Cash Incentive Award” means an Award (a) granted pursuant to Section 6(h), (b)
that is settled in cash and (c) the value of which is set by the Committee and
is not calculated by reference to the Fair Market Value of a Share.

 

“Change of Control” shall (a) have the meaning set forth in an Award Agreement;
provided, however, that except in the case of a transaction similar to a
transaction described in subparagraph (b)(iii) below, any definition of Change
of Control set forth in an Award Agreement shall provide that a Change of
Control shall not occur until consummation or effectiveness of a change in
control of the Company, rather than upon the announcement, commencement,
stockholder approval or other potential occurrence of any event or transaction
that, if completed, would result in a change in control of the Company, or
(b) if there is no definition set forth in an Award Agreement, mean the
occurrence of any of the following events following the Effective Date:

 

(i) during any period of 24 consecutive calendar months, individuals who were
directors of the Company on the first day of such period (the “Incumbent
Directors”) cease for any reason to constitute a majority of the Board;
provided, however, that any individual becoming a director subsequent to the
first day of such period whose election, or nomination for election, by the
Company’s stockholders was approved by a vote of at least a majority of the
Incumbent Directors shall be considered as though such individual were an
Incumbent Director, but excluding, for purposes of this proviso, any such
individual whose initial assumption of office occurs as a result of an actual or
threatened proxy contest with respect to election or removal of directors or
other actual or threatened solicitation of proxies or consents by or on behalf
of a “person” (as used in Section 13(d) of the Exchange Act) (a “Person”), in
each case other than the Board;

 

1

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

 

 

(ii) the consummation of (A) a merger, consolidation, statutory share exchange
or similar form of corporate transaction involving (x) the Company or (y) any of
its Subsidiaries, but in the case of this clause (y) only if Company Voting
Securities (as defined below) are issued or issuable (each of the events
referred to in this clause (A) being hereinafter referred to as a
“Reorganization”) or (B) the sale or other disposition of all or substantially
all the assets of the Company to an entity that is not an Affiliate (a “Sale”),
in each case, if such Reorganization or Sale requires the approval of the
Company’s stockholders under the law of the Company’s jurisdiction of
organization (whether such approval is required for such Reorganization or Sale
or for the issuance of securities of the Company in such Reorganization or
Sale), unless, immediately following such Reorganization or Sale, (1) all or
substantially all the Persons who were the “beneficial owners” (as used in Rule
13d-3 under the Exchange Act (or a successor rule thereto)) of the securities
eligible to vote for the election of the Board (“Company Voting Securities”)
outstanding immediately prior to the consummation of such Reorganization or Sale
continue to beneficially own, directly or indirectly, more than 50% of the
combined voting power of the then outstanding voting securities of the
corporation or other entity resulting from such Reorganization or Sale
(including a corporation or other entity that, as a result of such transaction,
owns the Company or all or substantially all the Company’s assets either
directly or through one or more subsidiaries) (the “Continuing Company”) in
substantially the same proportions as their ownership, immediately prior to the
consummation of such Reorganization or Sale, of the outstanding Company Voting
Securities (excluding, for such purposes, any outstanding voting securities of
the Continuing Company that such beneficial owners hold immediately following
the consummation of the Reorganization or Sale as a result of their ownership
prior to such consummation of voting securities of any corporation or other
entity involved in or forming part of such Reorganization or Sale other than the
Company), (2) no Person (excluding any employee benefit plan (or related trust)
sponsored or maintained by the Continuing Company or any entity controlled by
the Continuing Company) beneficially owns, directly or indirectly, 30% or more
of the combined voting power of the then outstanding voting securities of the
Continuing Company and (3) at least a majority of the members of the board of
directors of the Continuing Company were Incumbent Directors at the time of the
execution of the definitive agreement providing for such Reorganization or Sale
or, in the absence of such an agreement, at the time at which approval of the
Board was obtained for such Reorganization or Sale;

 

2

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

 

 

(iii) the stockholders of the Company approve a plan of complete liquidation or
dissolution of the Company unless such liquidation or dissolution is part of a
transaction or series of transactions described in paragraph (ii) above that
does not otherwise constitute a Change of Control; or

 

(iv) any Person, corporation or other entity or “group” (as used in
Section 13(d) of the Exchange Act) (other than (A) the Company, (B) any trustee
or other fiduciary holding securities under an employee benefit plan of the
Company or an Affiliate or (C) any entity owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of the voting power of the Company Voting Securities) becomes the
beneficial owner, directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company Voting
Securities; provided, however, that for purposes of this subparagraph (iv), the
following acquisitions shall not constitute a Change of Control: (w) any
acquisition directly from the Company, (x) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or an
Affiliate (y) any acquisition by an underwriter temporarily holding such Company
Voting Securities pursuant to an offering of such securities or any acquisition
by a pledgee of Company Voting Securities holding such securities as collateral
or temporarily holding such securities upon foreclosure of the underlying
obligation or (z) any acquisition pursuant to a Reorganization or Sale that does
not constitute a Change of Control for purposes of subparagraph (ii) above;

 

provided that, to the extent any Award provides for the payment of non-qualified
deferred compensation subject to Section 409A of the Code, an event set forth
above shall not constitute a “Change of Control” unless it also constitutes a
“change in ownership”, a “change in the effective control” or a “change in the
ownership of substantial assets” of the Company within the meaning of Treasury
Regulation Section 1.409A-3(i)(5) and such limitation is necessary to avoid an
impermissible distribution or other event resulting in adverse tax consequences
under Section 409A.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time, or
any successor statute thereto, and the regulations promulgated thereunder.

 

“Committee” means the Compensation Committee of the Board or a subcommittee
thereof, or such other committee of the Board as may be designated by the Board
to administer the Plan.

 

“Company” means Cable ONE, Inc., a corporation organized under the laws of
Delaware, together with any successor thereto.

 

“Deferred Share Unit” means a deferred share unit Award that represents an
unfunded and unsecured promise to deliver Shares in accordance with the terms of
the applicable Award Agreement.

 

“Effective Date” shall have the meaning set forth in Section 10(a).

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, or any successor statute thereto, and the regulations promulgated
thereunder.

 

“Exercise Price” means (a) in the case of each Option, the price specified in
the applicable Award Agreement as the price-per-Share at which Shares may be
purchased pursuant to such Option or (b) in the case of each SAR, the price
specified in the applicable Award Agreement as the reference price-per-Share
used to calculate the amount payable to the Participant pursuant to such SAR.

 

3

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

 

 

“Fair Market Value” means, except as otherwise provided in the applicable Award
Agreement, (a) with respect to any property other than Shares, the fair market
value of such property determined by such methods or procedures as shall be
established from time to time by the Committee and (b) with respect to Shares,
as of any date, (i) the closing per-share sales price of Shares as reported by
the Applicable Exchange for such stock exchange for such date or if there were
no sales on such date, on the closest preceding date on which there were sales
of Shares or (ii) in the event there shall be no public market for the Shares on
such date, the fair market value of the Shares as determined in good faith by
the Committee.

 

“Incentive Stock Option” means an option to purchase Shares from the Company
that (a) is granted under Section 6(b) of the Plan or the Prior Plan and (b) 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.

 

“Independent Director” means a member of the Board (a) who is neither an
employee of the Company nor an employee of any Affiliate, and (b) who, at the
time of acting, is a “Non-Employee Director” under Rule 16b-3.

 

“Nonqualified Stock Option” means an option to purchase Shares from the Company
that (a) is granted under Section 6(b) of the Plan or the Prior Plan and (b) is
not an Incentive Stock Option.

 

“Option” means an Incentive Stock Option or a Nonqualified Stock Option or both,
as the context requires.

 

“Participant” means any director, officer, employee or consultant (including any
prospective director, officer, employee or consultant) of the Company or its
Affiliates who is eligible for an Award under Section 5 and who is selected by
the Committee to receive an Award under the Plan or who receives a Substitute
Award pursuant to Section 4(c).

 

“Performance Compensation Award” means any Award designated by the Committee as
a Performance Compensation Award pursuant to Section 6(f) of the Plan or the
Prior Plan.

 

“Performance Criteria” means the criterion or criteria that the Committee shall
select for purposes of establishing the Performance Goal(s) for a Performance
Period with respect to any Performance Compensation Award or Performance Unit
or, if applicable, any Cash Incentive Award.

 

“Performance Formula” means, for a Performance Period, the one or more formulas
applied against the relevant Performance Goal to determine, with regard to the
Performance Compensation Award or Performance Unit or, if applicable, the Cash
Incentive Award of a particular Participant, whether all, some portion but less
than all, or none of such Award has been earned for the Performance Period.

 

“Performance Goal” means, for a Performance Period, the one or more goals
established by the Committee for the Performance Period based upon the
Performance Criteria.

 

“Performance Period” means the one or more periods of time as the Committee may
select over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant’s right to and the payment
of a Performance Compensation Award or Performance Unit or, if applicable, a
Cash Incentive Award.

 

“Performance Unit” means an Award under Section 6(f) of the Plan or the Prior
Plan that has a value set by the Committee (or that is determined by reference
to a valuation formula specified by the Committee or the Fair Market Value of
Shares), which value may be paid to the Participant by delivery of such property
as the Committee shall determine, including without limitation, cash or Shares,
or any combination thereof, upon achievement of such Performance Goals during
the relevant Performance Period as the Committee shall establish at the time of
such Award or thereafter.

 

“Plan” shall have the meaning specified in Section 1.

 

“Prior Plan” means the Cable ONE, Inc. 2015 Omnibus Incentive Compensation Plan.

 

“Restricted Share” means a Share that is granted under Section 6(d) of the Plan
or the Prior Plan that is subject to certain transfer restrictions, forfeiture
provisions and/or other terms and conditions specified herein and in the
applicable Award Agreement.

 

4

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

 

 

“RSU” means a restricted stock unit Award that is granted under Section 6(e) of
the Plan or the Prior Plan and is designated as such in the applicable Award
Agreement and that represents an unfunded and unsecured promise to deliver
Shares, cash, other securities, other Awards or other property in accordance
with the terms of the applicable Award Agreement.

 

“Rule 16b-3” means Rule 16b-3 as promulgated and interpreted by the SEC under
the Exchange Act or any successor rule or regulation thereto as in effect from
time to time.

 

“SAR” means a stock appreciation right Award that is granted under Section 6(c)
of the Plan or the Prior Plan and that represents an unfunded and unsecured
promise to deliver Shares, cash, other securities, other Awards or other
property equal in value to the excess, if any, of the Fair Market Value per
Share over the Exercise Price per Share of the SAR, subject to the terms of the
applicable Award Agreement.

 

“SEC” means the Securities and Exchange Commission or any successor thereto and
shall include the staff thereof.

 

“Shares” means shares of common stock of the Company, $0.01 par value, or such
other securities of the Company (a) into which such shares shall be changed by
reason of a recapitalization, merger, consolidation, split-up, combination,
exchange of shares or other similar transaction or (b) as may be determined by
the Committee pursuant to Section 4(b).

 

“Subsidiary” means any entity in which the Company, directly or indirectly,
possesses fifty percent (50%) or more of the total combined voting power of all
classes of its stock.

 

“Substitute Awards” shall have the meaning specified in Section 4(c).

 

“Treasury Regulations” means all proposed, temporary and final regulations
promulgated under the Code, as such regulations may be amended from time to time
(including corresponding provisions of succeeding regulations).

 

“Unrestricted Pool” means a number of Shares equal to 5% of the total number of
Shares originally available for issuance pursuant to Section 4 of the Prior Plan
less a number of Shares issued pursuant to Awards granted under the Prior Plan
prior to the Effective Date.

 

SECTION 3. Administration. (a) Composition of the Committee. The Plan shall be
administered by the Committee, which shall be composed of one or more directors,
as determined by the Board; provided that, to the extent necessary to comply
with the rules of the Applicable Exchange and Rule 16b-3 and to satisfy any
applicable requirements of Section 162(m) of the Code and any other applicable
laws or rules, the Committee shall be composed of two or more directors, all of
whom shall be Independent Directors and all of whom shall (i) qualify as
“outside directors” under Section 162(m) of the Code and (ii) meet the
independence requirements of the Applicable Exchange.

 

(b) Authority of the Committee. Subject to the terms of the Plan and applicable
law, and in addition to the other express powers and authorizations conferred on
the Committee by the Plan, the Committee shall have sole and plenary authority
to administer the Plan, including the authority to (i) designate Participants,
(ii) determine the type or types of Awards to be granted to a Participant,
(iii) determine the number of Shares or dollar value to be covered by, or with
respect to which payments, rights or other matters are to be calculated in
connection with, Awards, (iv) determine the terms and conditions of any Awards,
(v) determine the vesting schedules of Awards (which, except for Awards (A)
relating to a number of Shares not to exceed the Unrestricted Pool, (B) Cash
Incentive Awards and (C) Awards subject to vesting in whole or part based on
performance criteria, shall provide for full vesting no earlier than 12 months
after the applicable grant date (which minimum vesting period shall be deemed
satisfied with respect to an Award granted to an Independent Director in
connection with an annual shareholder meeting if such Award vests upon or after
the immediately following annual shareholder meeting), subject to any
accelerated vesting and/or exercisability, as applicable, determined by the
Committee in an Award Agreement, the Plan, the Prior Plan or any other
applicable arrangement to apply upon the occurrence of a specified event) and,
if certain performance criteria must be attained in order for an Award to vest
or be settled or paid, establish such performance criteria and certify whether,
and to what extent, such performance criteria have been attained, (vi) determine
whether, to what extent and under what circumstances Awards may be settled or
exercised in cash, Shares, other securities, other Awards or other property, or
canceled, forfeited or suspended and the method or methods by which Awards may
be settled, exercised, canceled, forfeited or suspended, (vii) determine
whether, to what extent and under what circumstances cash, Shares, other
securities, other Awards, other property and other amounts payable with respect
to an Award shall be deferred either automatically or at the election of the
holder thereof or of the Committee, (viii) interpret, administer, reconcile any
inconsistency in, correct any default in and/or supply any omission in, the Plan
and any instrument or agreement relating to, or Award made under, the Plan or
the Prior Plan, (ix) establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem appropriate for the proper
administration of the Plan, (x) accelerate the vesting or exercisability of,
payment for or lapse of restrictions on, Awards, (xi) amend an outstanding Award
or grant a replacement Award for an Award previously granted under the Plan or
the Prior Plan if, in its sole discretion, the Committee determines that (A) the
tax consequences of such Award to the Company or the Participant differ from
those consequences that were expected to occur on the date the Award was granted
or (B) clarifications or interpretations of, or changes to, tax law or
regulations permit Awards to be granted that have more favorable tax
consequences than initially anticipated and (xii) make any other determination
and take any other action that the Committee deems necessary or desirable for
the administration of the Plan.

 

5

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

 

 

(c) Committee Decisions. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations and other decisions under or with
respect to the Plan or any Award shall be within the sole and plenary discretion
of the Committee, may be made at any time and shall be final, conclusive and
binding upon all Persons, including the Company, any Affiliate, any Participant,
any holder or beneficiary of any Award and any stockholder. Without limiting the
generality of the foregoing, the Committee shall determine whether an authorized
leave of absence, or absence in military or government service, shall constitute
termination of employment. The employment of a Participant with the Company
shall be deemed to have terminated for all purposes of the Plan if such
Participant is employed by or provides services to a Person that is a Subsidiary
of the Company and such Person ceases to be a Subsidiary of the Company, unless
the Committee determines otherwise. A Participant who ceases to be an employee
of the Company but continues, or simultaneously commences, services as a
director of the Company shall not be deemed to have had a termination of
employment for purposes of the Plan.

 

(d) Indemnification. No member of the Board, the Committee or any employee of
the Company (each such person, a “Covered Person”) shall be liable for any
action taken or omitted to be taken or any determination made in good faith with
respect to the Plan or any Award. Each Covered Person shall be indemnified and
held harmless by the Company from and against (i) any loss, cost, liability or
expense (including attorneys’ fees) that may be imposed upon or incurred by such
Covered Person in connection with or resulting from any action, suit or
proceeding to which such Covered Person may be a party or in which such Covered
Person may be involved by reason of any action taken or omitted to be taken
under the Plan or any Award Agreement and (ii) any and all amounts paid by such
Covered Person, with the Company’s approval, in settlement thereof, or paid by
such Covered Person in satisfaction of any judgment in any such action, suit or
proceeding against such Covered Person; provided that the Company shall have the
right, at its own expense, to assume and defend any such action, suit or
proceeding, and, once the Company gives notice of its intent to assume the
defense, the Company shall have sole control over such defense with counsel of
the Company’s choice. The foregoing right of indemnification shall not be
available to a Covered Person to the extent that a court of competent
jurisdiction in a final judgment or other final adjudication, in either case not
subject to further appeal, determines that the acts or omissions of such Covered
Person giving rise to the indemnification claim resulted from such Covered
Person’s bad faith, fraud or willful criminal act or omission or that such right
of indemnification is otherwise prohibited by law or by the Company’s
organizational documents, in each case, as may be amended from time to time. The
foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which Covered Persons may be entitled under the Company’s
organizational documents, as a matter of law, or otherwise, or any other power
that the Company may have to indemnify such persons or hold them harmless.

 

(e) Delegation of Authority to Senior Officers. The Committee may delegate, on
such terms and conditions as it determines in its sole and plenary discretion,
to one or more senior officers of the Company, subject to such restrictions and
limitation as the Committee may specify and to the requirements of applicable
law, the authority to make grants of Awards to officers (other than any officer
subject to Section 16 of the Exchange Act), employees and consultants of the
Company and its Affiliates (including any prospective officer (other than any
such officer who is expected to be subject to Section 16 of the Exchange Act),
employee or consultant), and all necessary and appropriate decisions and
determinations with respect thereto.

 

(f) Awards to Independent Directors. Notwithstanding anything to the contrary
contained herein, the Board may, in its sole and plenary discretion, at any time
and from time to time, grant Awards to Independent Directors or administer the
Plan with respect to such Awards. In any such case, the Board shall have all the
authority and responsibility granted to the Committee herein.

 

SECTION 4. Shares Available for Awards; Cash Payable Pursuant to Awards. (a)
Shares and Cash Available. (i) Subject to adjustment as provided in
Section 4(b), the maximum aggregate number of Shares that may be delivered
pursuant to Awards granted under the Plan (the “ Plan Share Limit”) shall be
equal to 329,962 Shares, less (A) one Share for every Share that was subject to
an Option or stock-settled SAR granted under the Prior Plan after March 17, 2017
and prior to the Effective Date and two Shares for every Share that was subject
to an Award other than an Option or stock-settled SAR granted under the Prior
Plan after March 17, 2017 and prior to the Effective Date plus (B) one Share for
every Share not issued with respect to any Option or stock-settled SAR granted
under the Prior Plan, and two Shares in respect of every Share that was not
issued with respect to any Award (other than an Option or stock-settled SAR)
granted under the Prior Plan, in each case that was forfeited, or otherwise
terminated or was canceled without delivery of Shares, or was settled other than
wholly through delivery of Shares, after March 17, 2017 and prior to the
Effective Date under the Prior Plan.

 

6

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

 

 

(ii) Subject to adjustment as provided in Section 4(b), (A) each Share with
respect to which an Option or stock-settled SAR is granted under the Plan shall
reduce the aggregate number of Shares that may be delivered under the Plan by
one Share and (B) each Share with respect to which any other Award denominated
in Shares is granted under the Plan shall reduce the aggregate number of Shares
that may be delivered under the Plan by two Shares. Upon exercise of a
stock-settled SAR, each Share with respect to which such stock-settled SAR is
exercised shall be counted as one Share against the maximum aggregate number of
Shares that may be delivered pursuant to Awards granted under the Plan as
provided above, regardless of the number of Shares actually delivered upon
settlement of such stock-settled SAR. Awards that are required to be settled in
cash will not reduce the Plan Share Limit. Subject to adjustment as provided in
Section 4(b), the maximum aggregate number of Shares that may be delivered
pursuant to Incentive Stock Options granted under the Plan shall be equal
to 329,962 (such amount, the “Plan ISO Limit”).

 

(iii) If, after the Effective Date, any Award granted under the Plan or the
Prior Plan is (A) forfeited, or otherwise expires, terminates or is canceled
without the delivery of all Shares subject thereto, or (B) is settled other than
wholly by delivery of Shares (including cash settlement), then, in the case of
clauses (A) and (B), the number of Shares subject to such Award that were not
issued with respect to such Award will not be treated as issued for purposes of
reducing the Plan Share Limit. For the avoidance of doubt, no Shares that are
surrendered, withheld or tendered to the Company in payment of the exercise
price of an Option or any taxes required to be withheld in respect of any Award
shall again become available to be delivered pursuant to Awards granted under
the Plan.

 

(iv) With respect to Awards that are intended to qualify as “qualified
performance-based compensation” under Section 162(m) of the Code, subject to
adjustment as provided in Section 4(b), (A) in the case of Awards that are
settled in Shares, the maximum aggregate number of Shares with respect to which
Awards may be granted in any fiscal year of the Company under the Plan to any
Participant (other than an Independent Director) shall be 50,000 (the “Annual
Individual Plan Share Limit”), (B) in the case of Awards that are settled in
cash based on the Fair Market Value of a Share, the maximum aggregate amount of
cash that may be paid pursuant to Awards granted to any Participant (other than
an Independent Director) in any fiscal year of the Company under the Plan shall
be equal to the per-Share Fair Market Value as of the relevant vesting, payment
or settlement date multiplied by the Annual Individual Plan Share Limit, and (C)
in the case of all Awards to Participants (other than Independent Directors)
other than those described in clauses (A) and (B), the maximum aggregate amount
of cash and other property (valued at its Fair Market Value) other than Shares
that may be paid or delivered pursuant to Awards under the Plan to any
Participant (other than an Independent Director) in any fiscal year of the
Company shall be equal to $15,000,000.

 

(v) Notwithstanding any other provision in the Plan to the contrary, the
aggregate grant date fair value (computed as of the date of grant in accordance
with applicable financial accounting rules) of all Awards granted to any
Independent Director during any fiscal year, plus the aggregate amount of all
payments made in cash or other property earned and paid or payable pursuant to
Awards to such director for services rendered for the same fiscal year, shall
not exceed $500,000 (the “Annual Independent Director Compensation Limit”).  For
the avoidance of doubt, any amounts payable in respect of an Award shall be
counted in the fiscal year earned (not the fiscal year paid) and any interest,
dividends, dividend equivalents or other earnings on any such compensation, to
the extent not included in the calculation of the grant date fair value of such
Awards, shall not count towards the Annual Independent Director Compensation
Limit.

 

(b) Adjustments for Changes in Capitalization and Similar Events. (i) In the
event of any extraordinary dividend or other extraordinary distribution (whether
in the form of cash, Shares, other securities or other property),
recapitalization, rights offering, stock split, reverse stock split, split-up or
spin-off, the Committee shall equitably adjust any or all of (A) the number of
Shares or other securities of the Company (or number and kind of other
securities or property) with respect to which Awards may be granted, including
(1) Plan Share Limit, (2) the Plan ISO Limit, (3) the Annual Individual Plan
Share Limit and (4) the Unrestricted Pool, and (B) the terms of any outstanding
Award, including (1) the number of Shares or other securities of the Company (or
number and kind of other securities or property) subject to outstanding Awards
or to which outstanding Awards relate and (2) the Exercise Price, if applicable,
with respect to any Award; provided, however, that the Committee shall determine
the method and manner in which to effect such equitable adjustment.

 

(ii) In the event that the Committee determines that any reorganization, merger,
consolidation, combination, repurchase or exchange of Shares or other securities
of the Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction or event
affects the Shares (including any Change of Control) such that an adjustment is
determined by the Committee in its discretion to be appropriate or desirable,
then the Committee may (A) in such manner as it may deem appropriate or
desirable, equitably adjust any or all of (1) the number of Shares or other
securities of the Company (or number and kind of other securities or property)
with respect to which Awards may be granted, including (V) the Plan Share Limit,
(W) the Plan ISO Limit (X) the Annual Individual Plan Share Limit and (Y) the
Unrestricted Pool, and (2) the terms of any outstanding Award, including (X) the
number of Shares or other securities of the Company (or number and kind of other
securities or property) subject to outstanding Awards or to which outstanding
Awards relate and (Y) the Exercise Price, if applicable, with respect to any
Award, (B) if deemed appropriate or desirable by the Committee, make provision
for a cash payment to the holder of an outstanding Award in consideration for
the cancelation of such Award, including, in the case of an outstanding Option
or SAR, a cash payment to the holder of such Option or SAR in consideration for
the cancelation of such Option or SAR in an amount equal to the excess, if any,
of the Fair Market Value (as of a date specified by the Committee) of the Shares
subject to such Option or SAR over the aggregate Exercise Price of such Option
or SAR and (C) if deemed appropriate or desirable by the Committee, cancel and
terminate any Option or SAR having a per-Share Exercise Price equal to, or in
excess of, the Fair Market Value of a Share subject to such Option or SAR
without any payment or consideration therefor.

 

7

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

 

 

(c) Substitute Awards. Awards may, in the discretion of the Committee, be
granted under the Plan in assumption of, or in substitution for, outstanding
awards previously granted by the Company or any of its Affiliates or a company
acquired by the Company or any of its Affiliates or with which the Company or
any of its Affiliates combines (“Substitute Awards”); provided, however, that in
no event may any Substitute Award be granted in a manner that would violate the
prohibitions on repricing of Options and SARs, as set forth in clauses (i), (ii)
or (iii) of Section 7(b). The number of Shares underlying any Substitute Awards
shall be counted against the Plan Share Limit; provided, however, that
Substitute Awards issued in connection with the assumption of, or in
substitution for, outstanding awards previously granted by an entity that is
acquired by the Company or any of its Affiliates or with which the Company or
any of its Affiliates combines shall not be counted against the Plan Share
Limit; provided further that Substitute Awards issued in connection with the
assumption of, or in substitution for, outstanding stock options intended to
qualify for special tax treatment under Sections 421 and 422 of the Code that
were previously granted by an entity that is acquired by the Company or any of
its Affiliates or with which the Company or any of its Affiliates combines shall
be counted against the maximum aggregate number of Shares available for
Incentive Stock Options under the Plan.

 

(d) Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant to
an Award may consist, in whole or in part, of authorized and unissued Shares or
of treasury Shares.

 

SECTION 5. Eligibility. Any director, officer, employee or consultant (including
any prospective director, officer, employee or consultant) of the Company or any
of its Affiliates shall be eligible to be designated a Participant.

 

SECTION 6. Awards. (a) Types of Awards. Awards may be made under the Plan in the
form of (i) Options, (ii) SARs, (iii) Restricted Shares, (iv) RSUs,
(v) Performance Compensation Awards, (vi) Performance Units, (vii) Cash
Incentive Awards, (viii) Deferred Share Units and (ix) other equity based or
equity related Awards that the Committee determines are consistent with the
purpose of the Plan and the interests of the Company. Awards may be granted in
tandem with other Awards. No Incentive Stock Option (other than an Incentive
Stock Option that may be assumed or issued by the Company in connection with a
transaction to which Section 424(a) of the Code applies) may be granted to a
person who is ineligible to receive an Incentive Stock Option under the Code.

 

(b) Options. (i) Grant. Subject to the provisions of the Plan, the Committee
shall have sole and plenary authority to determine (A) the Participants to whom
Options shall be granted, (B) subject to Section 4(a), the number of Shares
subject to each Option to be granted to each Participant, (C) subject to Section
4(b)(ii), the Exercise Price thereof, (D) whether each Option shall be an
Incentive Stock Option or a Nonqualified Stock Option and (E) the terms and
conditions of each Option, including the vesting criteria, term, methods of
exercise and methods and form of settlement. In the case of Incentive Stock
Options, the terms and conditions of such grants shall be subject to and comply
with such rules as may be prescribed by Section 422 of the Code and any
regulations related thereto, as may be amended from time to time. Each Option
granted under the Plan shall be a Nonqualified Stock Option unless the
applicable Award Agreement expressly states that the Option is intended to be an
Incentive Stock Option. If an Option is intended to be an Incentive Stock
Option, and if, for any reason, such Option (or any portion thereof) shall not
qualify as an Incentive Stock Option, then, to the extent of such
nonqualification, such Option (or portion thereof) shall be regarded as a
Nonqualified Stock Option appropriately granted under the Plan; provided that
such Option (or portion thereof) otherwise complies with the Plan’s requirements
relating to Nonqualified Stock Options.

 

(ii) Exercise Price. The Exercise Price of each Share covered by each Option
shall be not less than 100% of the Fair Market Value of such Share (determined
as of the date the Option is granted); provided, however, that in the case of
each Incentive Stock Option granted to an employee who, at the time of the grant
of such Option, owns stock representing more than 10% of the voting power of all
classes of stock of the Company or any Affiliate, the per-Share Exercise Price
shall be no less than 110% of the Fair Market Value per Share on the date of the
grant; provided further that Options granted as Substitute Awards may be granted
with a per Share exercise price that is less than 100% of the Fair Market Value
per Share on the date of grant. Unless otherwise specified by the Committee,
each Option is intended to qualify as “qualified performance-based compensation”
under Section 162(m) of the Code.

 

8

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

 

 

(iii) Vesting and Exercise. Subject to the minimum vesting provisions of Section
3(b)(v), each Option shall be vested and exercisable at such times, in such
manner and subject to such terms and conditions as the Committee may, in its
sole and plenary discretion, specify in the applicable Award Agreement or
thereafter. Except as otherwise specified by the Committee in the applicable
Award Agreement, each Option may only be exercised to the extent that it has
already vested at the time of exercise. Each Option shall be deemed to be
exercised when written or electronic notice of such exercise has been given to
the Company in accordance with the terms of the Award by the person entitled to
exercise the Award and full payment pursuant to Section 6(b)(iv) for the Shares
with respect to which the Award is exercised has been received by the Company.
Each Option may be exercised in whole or in part; provided, however, an Option
shall not be exercisable with respect to fractional Shares and, except as the
Committee may, in its sole and plenary discretion, permit otherwise, each
partial exercise of an Option shall be with respect to a minimum of 500 Shares.
The partial exercise of an Option shall not cause the expiration, termination or
cancelation of the remaining portion thereof. Exercise of each Option in any
manner shall result in a decrease in the number of Shares that thereafter may be
available for sale under the Option and, except as expressly set forth in
Sections 4(a) and 4(c), in the number of Shares that may be available for
purposes of the Plan, by the number of Shares as to which the Option is
exercised. The Committee may impose such conditions with respect to the exercise
of each Option, including any conditions relating to the application of Federal
or state securities laws, as it may deem necessary or advisable.

 

(iv) Payment. (A) No Shares shall be delivered pursuant to any exercise of an
Option until payment in full of the aggregate Exercise Price therefor is
received by the Company, and the Participant has paid to the Company (or the
Company has withheld in accordance with Section 9(d)) an amount equal to any
Federal, state, local and foreign income and employment taxes required to be
withheld. Such payments may be made in cash (or its equivalent) or, in the
Committee’s sole and plenary discretion, (1) by exchanging Shares owned by the
Participant (which are not the subject of any pledge or other security
interest), (2) if there shall be a public market for the Shares at such time,
subject to such rules as may be established by the Committee, through delivery
of irrevocable instructions to a broker to sell the Shares otherwise deliverable
upon the exercise of the Option and to deliver cash promptly to the Company, (3)
by having the Company withhold Shares from the Shares otherwise issuable
pursuant to the exercise of the Option (for the avoidance of doubt, the Shares
withheld shall be counted against the maximum number of Shares that may be
delivered pursuant to the Awards granted under the Plan as provided in Section
4(a) or (4) through any other method (or combination of methods) as approved by
the Committee; provided that the combined value of all cash and cash equivalents
and the Fair Market Value of any such Shares so tendered to the Company,
together with any Shares withheld by the Company in accordance with this Section
6(b)(iv) or Section 9(d), as of the date of such tender, is at least equal to
such aggregate Exercise Price and the amount of any Federal, state, local or
foreign income or employment taxes required to be withheld, if applicable.

 

(B) Wherever in the Plan or any Award Agreement a Participant is permitted to
pay the Exercise Price of an Option or taxes relating to the exercise of an
Option by delivering Shares, the Participant may, subject to procedures
satisfactory to the Committee, satisfy such delivery requirement by presenting
proof of beneficial ownership of such Shares, in which case the Company shall
treat the Option as exercised without further payment and shall withhold such
number of Shares from the Shares acquired by the exercise of the Option.

 

(v) Expiration/Forfeiture. Except as otherwise set forth in the applicable Award
Agreement, each Option shall expire immediately, without any payment, upon the
tenth anniversary of the date the Option is granted (or, in the case of vested
Options, three months after the date the Participant who is holding the Option
ceases to be a director, officer, employee or consultant of the Company or one
of its Affiliates, if earlier). In no event may an Option be exercisable after
the tenth anniversary of the date the Option is granted.

 

(c) SARs. (i) Grant. Subject to the provisions of the Plan, the Committee shall
have sole and plenary authority to determine (A) the Participants to whom SARs
shall be granted, (B) subject to Section 4(a), the number of SARs to be granted
to each Participant and (C) subject to Section 4(c)(ii), the Exercise Price
thereof and (D) the terms and conditions of each SAR, including the vesting
criteria, term, methods of exercise and methods and form of settlement.

 

(ii) Exercise Price. The Exercise Price of each Share covered by a SAR shall be
not less than 100% of the Fair Market Value of such Share (determined as of the
date the SAR is granted); provided that SARs granted as Substitute Awards may be
granted with a per Share exercise price that is less than 100% of the Fair
Market Value per Share on the date of grant. Unless otherwise specified by the
Committee, each SAR is intended to qualify as “qualified performance-based
compensation” under Section 162(m) of the Code.

 

9

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

 

 

(iii) Vesting and Exercise. Each SAR shall entitle the Participant to receive an
amount upon exercise equal to the excess, if any, of the Fair Market Value of a
Share on the date of exercise of the SAR over the Exercise Price thereof. The
Committee shall determine, in its sole and plenary discretion, whether a SAR
shall be settled in cash, Shares, other securities, other Awards, other property
or a combination of any of the foregoing. Subject to the minimum vesting
provisions of Section 3(b)(v), each SAR shall be vested and exercisable at such
time, in such manner and subject to such terms and conditions as the Committee
may, in its discretion, specify in the applicable Award Agreement or thereafter.

 

(iv) Expiration/Forfeiture. Except as otherwise set forth in the applicable
Award Agreement, each SAR shall expire immediately, without any payment, upon
the tenth anniversary of the date the SAR is granted (or, in the case of vested
SARs, three months after the date the Participant who is holding the SAR ceases
to be a director, officer, employee or consultant of the Company or one of its
Affiliates, if earlier). In no event may SAR be exercisable after the tenth
anniversary of the date the SAR is granted.

 

(d) Restricted Shares. (i) Grant. Subject to the provisions of the Plan, the
Committee shall have sole and plenary authority to determine (A) the
Participants to whom Restricted Shares shall be granted, (B) subject to Section
4(a), the number of Restricted Shares to be granted to each Participant, (C)
subject to the minimum vesting provisions of Section 3(b)(v), the duration of
the period during which, and the conditions, if any, under which, the Restricted
Shares may vest or may be forfeited to the Company and (D) the terms and
conditions of each such Award, including the vesting criteria, term and methods
and form of settlement.

 

(ii) Share Certificates. Each Restricted Share may be evidenced in such manner
as the Committee shall determine. If certificates representing Restricted Shares
are registered in the name of the applicable Participant, such certificates must
bear an appropriate legend referring to the terms, conditions and restrictions
applicable to such Restricted Shares, and the Company may, at its discretion,
retain physical possession of such certificates until such time as all
applicable restrictions lapse.

 

(iii) Rights as a Stockholder. In connection with each grant of Restricted
Shares, except as provided in the applicable Award Agreement and subject to
Section 6(j), the Participant shall be entitled to the rights of a stockholder
(including the right to vote and the payment of dividends or dividend
equivalents) in respect of such Restricted Shares.

 

(e) RSUs. (i) Grant. Subject to the provisions of the Plan, the Committee shall
have sole and plenary authority to determine (A) the Participants to whom RSUs
shall be granted, (B) subject to Section 4(a), the number of RSUs to be granted
to each Participant, (C) subject to the minimum vesting provisions of Section
3(b)(v), the duration of the period during which, and the conditions, if any,
under which, the RSUs may vest or may be forfeited to the Company and (D) the
terms and conditions of each such Award, including the vesting criteria, term
and methods and form of settlement.

 

(ii) Payment/Lapse of Restrictions. Each RSU shall be granted with respect to a
specified number of Shares (or a number of Shares determined pursuant to a
specified formula) or shall have a value equal to the Fair Market Value of a
specified number of Shares (or a number of Shares determined pursuant to a
specified formula). RSUs shall be paid in cash, Shares, other securities, other
Awards or other property, as determined in the sole and plenary discretion of
the Committee, upon the lapse of restrictions applicable thereto, or otherwise
in accordance with the applicable Award Agreement.

 

(f) Performance Compensation Awards. (i) General. The Committee shall have the
authority, at the time of grant of any Award, to designate such Award (other
than an Option or SAR) as a Performance Compensation Award in order for such
Award to qualify as “qualified performance-based compensation” under
Section 162(m) of the Code. Options and SARs granted under the Plan shall not be
included among Awards that are designated as Performance Compensation Awards
under this Section 6(f).

 

(ii) Eligibility. The Committee shall, in its sole discretion, designate within
the first 90 days of a Performance Period (or, if shorter, within the maximum
period allowed under Section 162(m) of the Code) which Participants shall be
eligible to receive Performance Compensation Awards in respect of such
Performance Period. However, designation of a Participant as eligible to receive
an Award hereunder for a Performance Period shall not in any manner entitle such
Participant to receive payment in respect of any Performance Compensation Award
for such Performance Period. The determination as to whether or not such
Participant becomes entitled to payment in respect of any Performance
Compensation Award shall be decided solely in accordance with the provisions of
this Section 6(f). Moreover, designation of a Participant as eligible to receive
an Award hereunder for a particular Performance Period shall not require
designation of such Participant as eligible to receive an Award hereunder in any
subsequent Performance Period and designation of one person as a Participant
eligible to receive an Award hereunder shall not require designation of any
other person as a Participant eligible to receive an Award hereunder in such
period or in any other period.

 

10

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

 

 

(iii) Discretion of the Committee with Respect to Performance Compensation
Awards. With regard to a particular Performance Period, the Committee shall have
full discretion to select (A) the length of such Performance Period, (B) the
type(s) of Performance Compensation Awards to be issued, (C) the Performance
Criteria that will be used to establish the Performance Goal(s), (D) the kind(s)
and/or level(s) of the Performance Goals(s) that is (are) to apply to the
Company or any of its Subsidiaries, Affiliates, divisions or operational units,
or any combination of the foregoing, (E) any additional vesting conditions
whether or not performance-based (that are not deemed Performance Goals) that
may apply to such Awards and (F) the Performance Formula; provided that any such
Performance Formula shall be objective and non-discretionary. Within the first
90 days of a Performance Period (or, if shorter, within the maximum period
allowed under Section 162(m) of the Code), the Committee shall, with regard to
the Performance Compensation Awards to be issued for such Performance Period,
exercise its discretion with respect to each of the matters enumerated in the
immediately preceding sentence and record the same in writing.

 

(iv) Performance Criteria. Notwithstanding the foregoing, the Performance
Criteria that shall be used to establish the Performance Goal(s) with respect to
Performance Compensation Awards shall be based on the attainment of specific
levels of performance of the Company or any of its Subsidiaries, Affiliates,
divisions or operational units, or any combination of the foregoing, and shall
be limited to one or any combination of the following criteria: (A) share price;
(B) net income or earnings before or after taxes (including earnings before
interest, taxes, depreciation and/or amortization) (“EBITDA”); (C) adjusted
EBITDA (D) earnings per share (including specified types or categories thereof);
(E) cash flow (including specified types or categories thereof); (F) revenues
(including specified types or categories thereof); (G) return measures
(including specified types or categories thereof); (H) stockholder return
measures (including specified types or categories thereof); (I) sales or product
volume; (J) working capital; (K) gross or net profitability/profit margins
(including profitability of an identifiable business unit or product); (L)
earnings from continuing operations; (M) costs (including specified types or
categories thereof) and cost reduction goals; (N) budget comparisons; (O)
implementation or completion of critical projects; (P) market share (in the
aggregate or by segment); (Q) the formation of joint ventures, research or
development collaborations, or the completion of other transactions;
(R) economic value; (S) enterprise value; (T) book, economic book or intrinsic
book value (including book value per share); (U) improvements in capital
structure; (V) customer satisfaction survey results; (W) operating income; (X)
product unit and pricing targets; (Y) combined ratio; (Z) operating ratio; (AA)
leverage ratio; (BB) credit rating; (CC) borrowing levels; (DD) objective
measures of productivity or operating efficiency; (EE) expenses (including
specified types or categories thereof); (FF) product unit and pricing targets;
(GG) safety and accident rates; (HH) days sales outstanding; (II) operating
metrics relating to sales, installations or customer service or satisfaction
(JJ) capital spending management, network upgrades or product or service
deployments; and (KK) market share or penetration, subscriber or customer
acquisition or retention, ratings or viewership. Such Performance Criteria may
be applied on an absolute basis, be relative to one or more peer companies of
the Company or indices or any combination thereof or, if applicable, be computed
on an accrual or cash accounting basis. To the extent required under
Section 162(m) of the Code, the Committee shall, within the first 90 days of the
applicable Performance Period (or, if shorter, within the maximum period allowed
under Section 162(m) of the Code), define in an objective manner the method of
calculating the Performance Criteria it selects to use for such Performance
Period.

 

(v) Modification of Performance Goals. The Committee is authorized at any time
during the first 90 days of a Performance Period (or, if shorter, within the
maximum period allowed under Section 162(m) of the Code), or any time thereafter
(but only to the extent the exercise of such authority after such 90-day period
(or such shorter period, if applicable) would not cause the Performance
Compensation Awards granted to any Participant for the Performance Period to
fail to qualify as “qualified performance-based compensation” under
Section 162(m) of the Code), in its sole and plenary discretion, to adjust or
modify the calculation of a Performance Goal for such Performance Period to the
extent permitted under Section 162(m) of the Code, including but not limited to,
(A) in the event of, or in anticipation of, any unusual or nonrecurring
corporate item, transaction, event or development affecting the Company, or any
of its Affiliates, Subsidiaries, divisions or operating units (to the extent
applicable to such Performance Goal) or (B) in recognition of, or in
anticipation of, any other unusual or nonrecurring events affecting the Company
or any of its Affiliates, Subsidiaries, divisions or operating units (to the
extent applicable to such Performance Goal), or the financial statements of the
Company or any of its Affiliates, Subsidiaries, divisions or operating units (to
the extent applicable to such Performance Goal), or of changes in applicable
rules, rulings, regulations or other requirements of any governmental body or
securities exchange, accounting principles, law or business conditions.

 

(vi) Payment of Performance Compensation Awards. (A) Condition to Receipt of
Payment. A Participant must be employed by the Company or one of its
Subsidiaries on the last day of a Performance Period to be eligible for payment
in respect of a Performance Compensation Award for such Performance Period.
Notwithstanding the foregoing and to the extent permitted by Section 162(m) of
the Code, in the discretion of the Committee, Performance Compensation Awards
may be paid to Participants who have retired or whose employment has terminated
prior to the last day of the Performance Period for which a Performance
Compensation Award is made, or to the designee or estate of a Participant who
died prior to the last day of a Performance Period.

 

11

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

 

 

(B) Limitation. Except as otherwise permitted by Section 162(m) of the Code, a
Participant shall be eligible to receive a payment in respect of a Performance
Compensation Award only to the extent that (1) the Performance Goal(s) for the
relevant Performance Period are achieved and certified by the Committee in
accordance with Section 6(f)(vi)(C) and (2) the Performance Formula as applied
against such Performance Goal(s) determines that all or some portion of such
Participant’s Performance Compensation Award has been earned for such
Performance Period.

 

(C) Certification. Following the completion of a Performance Period, the
Committee shall certify in writing whether, and to what extent, the Performance
Goals for the Performance Period have been achieved and, if so, to calculate and
certify in writing that amount of the Performance Compensation Awards earned for
the period based upon the objective Performance Formula. The Committee shall
then determine the actual amount of each Participant’s Performance Compensation
Award for the Performance Period and, in so doing, may apply negative discretion
as authorized by Section 6(f)(vi)(D).

 

(D) Negative Discretion. In determining the actual amount of an individual
Performance Compensation Award for a Performance Period, the Committee may, in
its sole and plenary discretion, reduce or eliminate the amount of the Award
earned in the Performance Period, even if applicable Performance Goals have been
attained and without regard to any employment agreement between the Company and
a Participant.

 

(E) Discretion. Except as otherwise permitted by Section 162(m) of the Code, in
no event shall any discretionary authority granted to the Committee by the Plan
be used to (1) grant or provide payment in respect of Performance Compensation
Awards for a Performance Period if the Performance Goals for such Performance
Period have not been attained, (2) increase a Performance Compensation Award for
any Participant at any time after the first 90 days of the Performance Period
(or, if shorter, the maximum period allowed under Section 162(m) of the Code) or
(3) increase the amount of a Performance Compensation Award above the maximum
amount payable under Section 4(a) of the Plan. Nothing in this Section 6(f) is
intended to limit the Committee’s discretion to adopt conditions with respect to
any Award that is not intended to qualify as “performance-based compensation”
under Section 162(m) of the Code or the Committee’s discretion in respect of
conditions that are not Performance Goals with respect to any Award that is
intended to qualify as “performance-based compensation” under Section 162(m) of
the Code.

 

(F) Form of Payment. In the case of any Performance Compensation Award other
than a Restricted Share, RSU or other equity-based Award that is subject to
performance-based vesting conditions, such Performance Compensation Award shall
be payable, in the discretion of the Committee, in cash or in Restricted Shares,
RSUs or fully vested Shares of equivalent value and shall be paid on such terms
as determined by the Committee in its discretion. Any Restricted Shares and RSUs
shall be subject to the terms of this Plan (or any successor equity-compensation
plan) and any applicable Award Agreement. The number of Restricted Shares, RSUs
or Shares that is equivalent in value to a dollar amount shall be determined in
accordance with a methodology specified by the Committee within the first
90 days of the relevant Performance Period (or, if shorter, within the maximum
period allowed under Section 162(m) of the Code).

 

(g) Performance Units. (i) Grant. Subject to the provisions of the Plan, the
Committee shall have sole and plenary authority to determine the Participants to
whom Performance Units shall be granted.

 

(ii) Value of Performance Units. Each Performance Unit shall have an initial
value that is established by the Committee at the time of grant. The Committee
shall set Performance Goals in its discretion which, depending on the extent to
which they are met during a Performance Period, will determine in accordance
with Section 4(a) the number and/or value of Performance Units that will be paid
out to the Participant.

 

(iii) Earning of Performance Units. Subject to the provisions of the Plan, after
the applicable Performance Period has ended, the holder of Performance Units
shall be entitled to receive a payout of the number and value of Performance
Units earned by the Participant over the Performance Period, to be determined by
the Committee, in its sole and plenary discretion, as a function of the extent
to which the corresponding Performance Goals have been achieved.

 

(iv) Form and Timing of Payment of Performance Units. Subject to the provisions
of the Plan, the Committee, in its sole and plenary discretion, may pay earned
Performance Units in the form of cash or in Shares (or in a combination thereof)
that have an aggregate Fair Market Value equal to the value of the earned
Performance Units at the close of the applicable Performance Period. Such Shares
may be granted subject to any restrictions in the applicable Award Agreement
deemed appropriate by the Committee. The determination of the Committee with
respect to the form and timing of payout of such Awards shall be set forth in
the applicable Award Agreement.

 

12

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

 

 

(h) Cash Incentive Awards. (i) Grant. Subject to the provisions of the Plan, the
Committee, in its sole and plenary discretion, shall have the authority to
determine (A) the Participants to whom Cash Incentive Awards shall be granted,
(B) subject to Section 4(a), the amount of Cash Incentive Awards to be granted
to each Participant, (C) the duration of the period during which, and the
conditions, if any, under which, the Cash Incentive Awards may vest or may be
forfeited to the Company and (D) the other terms and conditions of each Cash
Incentive Award. Each Cash Incentive Award shall have an initial value that is
established by the Committee at the time of grant. The Committee may set
performance goals or other payment conditions in its discretion, which,
depending on the extent to which they are met during a specified performance
period, shall determine the amount and/or value of the Cash Incentive Award that
shall be paid to the Participant.

 

(ii) Earning of Cash Incentive Awards. Subject to the provisions of the Plan,
after the applicable vesting period has ended, the holder of a Cash Incentive
Award shall be entitled to receive a payout of the amount of the Cash Incentive
Award earned by the Participant over the specified vesting period, which, in the
case of any Cash Incentive Award the vesting of which is subject to the
achievement of performance goals, shall be determined by the Committee, in its
sole and plenary discretion, as a function of the extent to which the
corresponding performance goals or other conditions to payment have been
achieved.

 

(i) Other Stock-Based Awards. Subject to the provisions of the Plan, including
the minimum vesting provisions of Section 3(b)(v), the Committee shall have the
sole and plenary authority to grant to Participants other equity-based or
equity-related Awards (including Deferred Share Units and fully vested Shares)
(whether payable in cash, equity or otherwise) in such amounts and subject to
such terms and conditions as the Committee shall determine; provided that any
such Awards must comply, to the extent deemed desirable by the Committee, with
Rule 16b-3 and applicable law.

 

(j) Dividends and Dividend Equivalents. In the sole and plenary discretion of
the Committee, the Committee may provide in the applicable Award Agreement,
other than for an Option, SAR or Cash Incentive Award, for the payment of
dividends or dividend equivalents to the Participant, payable in cash, Shares,
other securities, other Awards or other property, on a current or deferred
basis, on such terms and conditions as may be determined by the Committee in its
sole and plenary discretion, including (i) payment directly to the Participant,
(ii) withholding of such amounts by the Company subject to vesting of the Award
or (iii) reinvestment in additional Shares, Restricted Shares or other Awards;
provided, however, that a Participant shall be eligible to receive dividends or
dividend equivalents in respect of any such Award only to the extent that the
applicable vesting criteria for such Award have been satisfied and in the case
of any Performance Compensation Award, Performance Unit or other
performance-based Award that is payable upon the achievement of Performance
Goals, (A) the Performance Goals for the relevant Performance Period are
achieved and (B) the Performance Formula as applied against such Performance
Goals determines that all or some portion of such Award has been earned for such
Performance Period.

 

SECTION 7. Amendment and Termination. (a) Amendments to the Plan. Subject to any
applicable law or government regulation, to any requirement that must be
satisfied if the Plan is intended to be a stockholder-approved plan for purposes
of Section 162(m) of the Code and to the rules of the Applicable Exchange, the
Plan may be amended, modified or terminated by the Board without the approval of
the stockholders of the Company, except that stockholder approval shall be
required for any amendment that would (i) increase either the Plan Share Limit
or the Plan ISO Limit, (ii) change the class of employees or other individuals
eligible to participate in the Plan or (iii) result in the amendment,
cancellation or action described in clause (i), (ii) or (iii) of the second
sentence of Section 7(b) being permitted without the approval by the Company’s
stockholders; provided, however, that any adjustment under Section 4(b) shall
not constitute an increase for purposes of this Section 7(a)(i). No amendment,
modification or termination of the Plan may, without the consent of the
Participant to whom any Award shall theretofor have been granted, materially and
adversely affect the rights of such Participant (or his or her transferee) under
such Award, unless otherwise provided by the Committee in the applicable Award
Agreement or made to comply with applicable law, tax rules, stock exchange rules
or accounting rules.

 

(b) Amendments to Awards. The Committee may waive any conditions or rights
under, amend any terms of, or alter, suspend, discontinue, cancel or terminate
any Award theretofor granted, prospectively or retroactively; provided, however,
that, except as set forth in the Plan, for such actions taken to comply with
applicable law, tax rules, stock vesting rules or accounting rules or as
otherwise provided by the Committee in the applicable Award Agreement, any such
waiver, amendment, alteration, suspension, discontinuance, cancelation or
termination that would materially and adversely impair the rights of any
Participant or any holder or beneficiary of any Award theretofor granted shall
not to that extent be effective without the consent of the applicable
Participant, holder or beneficiary. Notwithstanding the preceding sentence, in
no event may any Option or SAR (i) be amended to decrease the Exercise Price
thereof, (ii) be canceled at a time when its Exercise Price exceeds the Fair
Market Value of the underlying Shares in exchange for another Option or SAR or
any Restricted Share, RSU, other equity-based Award, award under any other
equity-compensation plan or any cash payment or (iii) be subject to any action
that would be treated, for accounting purposes, as a “repricing” of such Option
or SAR, unless such amendment, cancelation or action is approved by the
Company’s stockholders. For the avoidance of doubt, an adjustment to the
Exercise Price of an Option or SAR that is made in accordance with Section 4(b)
or Section 8 shall not be considered a reduction in Exercise Price or
“repricing” of such Option or SAR.

 

13

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

 

 

(c) Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
Events. Subject to Section 6(f)(v) and the penultimate sentence of Section 7(b),
the Committee is hereby authorized to make adjustments in the terms and
conditions of, and the criteria included in, Awards in recognition of unusual or
nonrecurring events (including the events described in Section 4(b) or the
occurrence of a Change of Control) affecting the Company, any Affiliate, or the
financial statements of the Company or any Affiliate, or of changes in
applicable rules, rulings, regulations or other requirements of any governmental
body or securities exchange, accounting principles or law (i) whenever the
Committee, in its sole and plenary discretion, determines that such adjustments
are appropriate or desirable, including providing for a substitution or
assumption of Awards, accelerating the exercisability of, lapse of restrictions
on, or termination of, Awards or providing for a period of time for exercise
prior to the occurrence of such event, (ii) if deemed appropriate or desirable
by the Committee, in its sole and plenary discretion, by providing for a cash
payment to the holder of an Award in consideration for the cancelation of such
Award, including, in the case of an outstanding Option or SAR, a cash payment to
the holder of such Option or SAR in consideration for the cancelation of such
Option or SAR in an amount equal to the excess, if any, of the Fair Market Value
(as of a date specified by the Committee) of the Shares subject to such Option
or SAR over the aggregate Exercise Price of such Option or SAR and (iii) if
deemed appropriate or desirable by the Committee, in its sole and plenary
discretion, by canceling and terminating any Option or SAR having a per-Share
Exercise Price equal to, or in excess of, the Fair Market Value of a Share
subject to such Option or SAR without any payment or consideration therefor.

 

SECTION 8. Change of Control. Unless otherwise provided in the applicable Award
Agreement, in the event of a Change of Control after the Effective Date, unless
provision is made in connection with the Change of Control for (a) assumption or
continuation of Awards previously granted or (b) substitution for such Awards of
new awards covering stock of a successor corporation or its “parent corporation”
(as defined in Section 424(e) of the Code) or “subsidiary corporation” (as
defined in Section 424(f) of the Code) with appropriate adjustments as to the
number and kinds of shares and the Exercise Prices, if applicable, (i) any
outstanding Options or SARs then held by Participants that are unexercisable or
otherwise unvested shall automatically be deemed exercisable or otherwise
vested, as the case may be, as of immediately prior to such Change of Control,
(ii) all Performance Units, Cash Incentive Awards and Awards designated as
Performance Compensation Awards shall automatically vest as of immediately prior
to such Change of Control as if the date of the Change of Control were the last
day of the applicable Performance Period and “target” performance levels had
been attained and shall be paid out as soon as practicable following such Change
of Control, and (iii) all other outstanding Awards (i.e., other than Options,
SARs, Performance Units, Cash Incentive Awards and Awards designated as
Performance Compensation Awards) then held by Participants that are
unexercisable, unvested or still subject to restrictions or forfeiture, shall
automatically be deemed exercisable and vested and all restrictions and
forfeiture provisions related thereto shall lapse as of immediately prior to
such Change of Control and shall be paid out as soon as practicable following
such Change of Control. The Committee shall have full and final authority, which
shall be exercised in its discretion, to determine conclusively whether a Change
of Control has occurred and the date of the occurrence of such Change of Control
and any incidental matters relating thereto.

 

SECTION 9. General Provisions. (a) Nontransferability. Except as otherwise
specified in the applicable Award Agreement, during the Participant’s lifetime,
each Award (and any rights and obligations thereunder) shall be exercisable only
by the Participant, or, if permissible under applicable law, by the
Participant’s legal guardian or representative, and no Award (or any rights and
obligations thereunder) may be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by a Participant otherwise than by will or
by the laws of descent and distribution, and any such purported assignment,
alienation, pledge, attachment, sale, transfer or encumbrance shall be void and
unenforceable against the Company or any Affiliate; provided that (i) the
designation of a beneficiary shall not constitute an assignment, alienation,
pledge, attachment, sale, transfer or encumbrance; (ii) no transfer by will or
the laws of descent and distribution of any Award, or the right to exercise any
Award, shall be effective to bind the Company unless the Committee shall have
been furnished with (a) written notice thereof and with a copy of the will
and/or such evidence as the Committee may deem necessary to establish the
validity of the transfer and (b) an agreement by the transferee to comply with
all the terms and conditions of the Award that are or would have been applicable
to the Participant and to be bound by the acknowledgements made by the
Participant in connection with the grant of the Award; and (iii) the Board or
the Committee may permit further transferability, on a general or specific
basis, and may impose conditions and limitations on any permitted
transferability; provided, however, that Incentive Stock Options shall not be
transferable in any way that would violate Section 1.422-2(a)(2) of the Treasury
Regulations and in no event may any Award (or any rights and obligations
thereunder) be transferred in any way in exchange for value. All terms and
conditions of the Plan and all Award Agreements shall be binding upon any
permitted successors and assigns.

 

14

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

 

 

(b) No Rights to Awards. No Participant or other Person shall have any claim to
be granted any Award, and there is no obligation for uniformity of treatment of
Participants or holders or beneficiaries of Awards. The terms and conditions of
Awards and the Committee’s determinations and interpretations with respect
thereto need not be the same with respect to each Participant and may be made
selectively among Participants, whether or not such Participants are similarly
situated.

 

(c) Share Certificates. All certificates or book entry credits for Shares or
other securities of the Company or any Affiliate delivered under the Plan
pursuant to any Award or the exercise thereof shall be subject to such stop
transfer orders and other restrictions as the Committee may deem advisable under
the Plan, the applicable Award Agreement or the rules, regulations and other
requirements of the SEC, the Applicable Exchange and any applicable Federal or
state laws, and the Committee may cause a legend or legends to be put on any
such certificates to make appropriate reference to such restrictions. Shares
shall be evidenced in such manner as the Committee may deem appropriate,
including book-entry registration or issuance of one or more stock certificates.

 

(d) Withholding. (i) Authority to Withhold. A Participant may be required to pay
to the Company or any Affiliate, and the Company or any Affiliate shall have the
right and is hereby authorized to withhold from any Award, from any payment due
or transfer made under any Award or under the Plan or from any compensation or
other amount owing to a Participant, the amount (in cash, Shares, other
securities, other Awards or other property) of any applicable withholding taxes
in respect of an Award, its exercise or any payment or transfer under an Award
or under the Plan and to take such other action as may be necessary in the
opinion of the Committee or the Company to satisfy all obligations for the
payment of such taxes.

 

(ii) Alternative Ways to Satisfy Withholding Liability. Without limiting the
generality of Section 9(d)(i), subject to the Committee’s discretion, a
Participant may satisfy, in whole or in part, the foregoing withholding
liability (A) by delivery of Shares owned by the Participant (which are not
subject to any pledge or other security interest) or by delivery of irrevocable
instructions to a broker to sell Shares and promptly deliver to the Company the
proceeds from the sale of Shares, in each case, with the amount realized equal
to the amount required to cover such withholding liability or (B) by having the
Company withhold from the number of Shares otherwise issuable pursuant to the
exercise of the Option or SAR, or the lapse of the restrictions on any other
Award (in the case of SARs and other Awards, if such SARs and other Awards are
settled in Shares), the number of whole Shares necessary to satisfy such
withholding liability based on the fair value of such Shares at such time.

 

(e) Section 409A. (i) It is intended that the provisions of the Plan comply with
Section 409A of the Code, and all provisions of the Plan shall be construed and
interpreted in a manner consistent with the requirements for avoiding taxes or
penalties under Section 409A of the Code.

 

(ii) No Participant or the creditors or beneficiaries of a Participant shall
have the right to subject any deferred compensation (within the meaning of
Section 409A of the Code) payable under the Plan to any anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment or
garnishment. Except as permitted under Section 409A of the Code, any deferred
compensation (within the meaning of Section 409A of the Code) payable to any
Participant or for the benefit of any Participant under the Plan may not be
reduced by, or offset against, any amount owing by any such Participant to the
Company or any of its Affiliates.

 

(iii) If, at the time of a Participant’s separation from service (within the
meaning of Section 409A of the Code), (A) such Participant shall be a specified
employee (within the meaning of Section 409A of the Code and using the
identification methodology selected by the Company from time to time) and (B)
the Company shall make a good faith determination that an amount payable
pursuant to an Award constitutes deferred compensation (within the meaning of
Section 409A of the Code) the payment of which is required to be delayed
pursuant to the six-month delay rule set forth in Section 409A of the Code in
order to avoid taxes or penalties under Section 409A of the Code, then the
Company shall not pay such amount on the otherwise scheduled payment date but
shall instead pay it on the first business day after such six-month period. Such
amount shall be paid without interest, unless otherwise determined by the
Committee, in its sole discretion, or as otherwise provided in any applicable
employment agreement between the Company and the relevant Participant.

 

(iv) Notwithstanding any provision of the Plan to the contrary, in light of the
uncertainty with respect to the proper application of Section 409A of the Code,
the Company reserves the right to make amendments to any Award as the Company
deems necessary or desirable to avoid the imposition of taxes or penalties under
Section 409A of the Code. In any case, a Participant shall be solely responsible
and liable for the satisfaction of all taxes and penalties that may be imposed
on such Participant or for such Participant’s account in connection with an
Award (including any taxes and penalties under Section 409A of the Code), and
neither the Company nor any of its Affiliates shall have any obligation to
indemnify or otherwise hold such Participant harmless from any or all of such
taxes or penalties.

 

15

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

 

 

(f) Award Agreements. Each Award hereunder shall be evidenced by an Award
Agreement, which shall be delivered to the Participant and shall specify the
terms and conditions of the Award and any rules applicable thereto, including
the effect on such Award of the death, disability or termination of employment
or service of a Participant and the effect, if any, of such other events as may
be determined by the Committee.

 

(g) No Limit on Other Compensation Arrangements. Nothing contained in the Plan
shall prevent the Company or any Affiliate from adopting or continuing in effect
other compensation arrangements, which may, but need not, provide for the grant
of options, restricted stock, shares, other types of equity-based awards
(subject to stockholder approval if such approval is required) and cash
incentive awards, and such arrangements may be either generally applicable or
applicable only in specific cases.

 

(h) No Right to Employment. The grant of an Award shall not be construed as
giving a Participant the right to be retained as a director, officer, employee
or consultant of or to the Company or any Affiliate, nor shall it be construed
as giving a Participant any rights to continued service on the Board. Further,
the Company or an Affiliate may at any time dismiss a Participant from
employment or discontinue any directorship or consulting relationship, free from
any liability or any claim under the Plan, unless otherwise expressly provided
in the Plan or in any Award Agreement.

 

(i) No Rights as Stockholder. No Participant or holder or beneficiary of any
Award shall have any rights as a stockholder with respect to any Shares to be
distributed under the Plan until he or she has become the holder of such Shares.
Except as otherwise provided in Section 4(b), Section 7(c) or the applicable
Award Agreement, no adjustments shall be made for dividends or distributions on
(whether ordinary or extraordinary, and whether in cash, Shares, or other
securities or other property), or other events relating to, Shares subject to an
Award for which the record date is prior to the date such Shares are delivered.

 

(j) Governing Law. (i) The validity, construction and effect of the Plan and any
rules and regulations relating to the Plan and any Award Agreement shall be
determined in accordance with the laws of the State of Delaware, without giving
effect to the conflict of laws provisions thereof.

 

(k) Severability. If any provision of the Plan or any Award is or becomes or is
deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any
Person or Award, or would disqualify the Plan or any Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed amended
to conform to the applicable laws, or if it cannot be construed or deemed
amended without, in the determination of the Committee, materially altering the
intent of the Plan or the Award, such provision shall be construed or deemed
stricken as to such jurisdiction, Person or Award and the remainder of the Plan
and any such Award shall remain in full force and effect.

 

(l) Other Laws; Restrictions on Transfer of Shares. The Committee may refuse to
issue or transfer any Shares or other consideration under an Award if, acting in
its sole and plenary discretion, it determines that the issuance or transfer of
such Shares or such other consideration might violate any applicable law or
regulation or entitle the Company to recover the same under Section 16(b) of the
Exchange Act, and any payment tendered to the Company by a Participant, other
holder or beneficiary in connection with the exercise of such Award shall be
promptly refunded to the relevant Participant, holder or beneficiary. Without
limiting the generality of the foregoing, no Award granted hereunder shall be
construed as an offer to sell securities of the Company, and no such offer shall
be outstanding, unless and until the Committee in its sole and plenary
discretion has determined that any such offer, if made, would be in compliance
with all applicable requirements of the U.S. Federal and any other applicable
securities laws.

 

(m) No Trust or Fund Created. Neither the Plan nor any Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Affiliate, on one hand, and a
Participant or any other Person, on the other. To the extent that any Person
acquires a right to receive payments from the Company or any Affiliate pursuant
to an Award, such right shall be no greater than the right of any unsecured
general creditor of the Company or such Affiliate.

 

16

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

 

 

(n) Recoupment of Awards. Notwithstanding anything to the contrary contained
herein, an Award Agreement may provide that an Award granted thereunder shall be
canceled if the Participant, without the consent of the Company, while employed
by or providing services to the Company or any Affiliate or after termination of
such employment or service, (a) violates a non-competition, non-solicitation or
non-disclosure covenant or agreement, (b) otherwise engages in activity that is
in conflict with or adverse to the interest of the Company or any Affiliate,
including fraud or conduct contributing to any financial restatements or
irregularities, as determined by the Committee in its sole discretion or (c) to
the extent applicable to the Participant, otherwise violates any policy adopted
by the Company or any of its Affiliates relating to the recovery of compensation
granted, paid, delivered, awarded or otherwise provided to any Participant by
the Company or any of its Affiliates as such policy is in effect on the date of
grant of the applicable Award or, to the extent necessary to address the
requirements of applicable law (including Section 954 of the Dodd-Frank Wall
Street Reform and Consumer Protection Act of 2010, as codified in Section 10D of
the Exchange Act, Section 304 of the Sarbanes-Oxley Act of 2002 or any other
applicable law), as may be amended from time to time. The Committee may also
provide in an Award Agreement that (i) a Participant will forfeit any gain
realized on the vesting or exercise of such Award if the Participant engages in
any activity referred to in the preceding sentence, or (ii) a Participant must
repay the gain to the Company realized under a previously paid Performance
Compensation Award, Performance Unit or any other Award that vested or was
earned with respect to performance objectives if a financial restatement reduces
the amount that would have been earned under such Award. Notwithstanding the
foregoing, none of the non-disclosure restrictions in this Section 9(n) or in
any Award Agreement shall, or shall be interpreted to, impair the Participant
from exercising any legally protected whistleblower rights (including under Rule
21F under the Exchange Act).

 

(o) No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award, and the Committee shall determine whether
cash, other securities or other property shall be paid or transferred in lieu of
any fractional Shares or whether such fractional Shares or any rights thereto
shall be canceled, terminated or otherwise eliminated.

 

(p) Requirement of Consent and Notification of Election Under Section 83(b) of
the Code or Similar Provision. No election under Section 83(b) of the Code (to
include in gross income in the year of transfer the amounts specified in
Section 83(b) of the Code) or under a similar provision of law may be made
unless expressly permitted by the terms of the applicable Award Agreement or by
action of the Committee in writing prior to the making of such election. If an
Award recipient, in connection with the acquisition of Shares under the Plan or
otherwise, is expressly permitted under the terms of the applicable Award
Agreement or by such Committee action to make such an election and the
Participant makes the election, the Participant shall notify the Committee of
such election within ten days of filing notice of the election with the Internal
Revenue Service (or any successor thereto) or other governmental authority, in
addition to any filing and notification required pursuant to regulations issued
under Section 83(b) of the Code or any other applicable provision.

 

(q) Requirement of Notification Upon Disqualifying Disposition Under
Section 421(b) of the Code. If any Participant shall make any disposition of
Shares delivered pursuant to the exercise of an Incentive Stock Option under the
circumstances described in Section 421(b) of the Code (relating to certain
disqualifying dispositions) or any successor provision of the Code, such
Participant shall notify the Company of such disposition within ten days of such
disposition.

 

(r) Headings and Construction. Headings are given to the Sections and
subsections of the Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of the Plan or any provision thereof. Whenever the words
“include”, “includes” or “including” are used in the Plan, they shall be deemed
to be followed by the words “but not limited to”, and the word “or” shall not be
deemed to be exclusive.

 

SECTION 10. Term of the Plan. (a) Effective Date. The Plan shall be effective as
of the date of its adoption by the Board and approval by the Company’s
stockholders (the date of such approval, the “Effective Date”).

 

(b) Expiration Date. No Award shall be granted under the Plan after the tenth
anniversary of the Effective Date. No Incentive Stock Option shall be granted
under the Plan after the tenth anniversary of the date of its adoption by the
Board. Unless otherwise expressly provided in the Plan or in an applicable Award
Agreement, any Award granted hereunder, and the authority of the Board or the
Committee to amend, alter, adjust, suspend, discontinue or terminate any such
Award or to waive any conditions or rights under any such Award, shall
nevertheless continue thereafter.

 

17