Exhibit 10.1

 

U.S. Energy Corp.

Amended and Restated 2012 Equity and Performance Incentive Plan

 

Adopted By the Board: April 24, 2010, March 20, 2015, April 27, 2017 April 24,
2018, April 20, 2020

Approved by the Shareholders: June 29, 2012 June 19, 2015, July 17, 2017
September 11, 2018, June 9, 2020

Effective: July 1, 2012 2015 July 17, 2017 September 11, 2018, June 9, 2020

 

1. Purpose. The purpose of the 2012 Equity and Performance Incentive Plan is to
attract and retain officers and other employees of U.S. Energy Corp., a Wyoming
corporation, and its Subsidiaries and to provide to such persons incentives and
rewards for superior performance.

 

2. Definitions. As used in this Plan,

 

(a) “Award” means any Option, Stock Appreciation Right, Restricted Stock,
Performance Share, Performance Unit, Other Share-Based Award, or any other
right, interest or option related to Shares or other property (including cash)
granted pursuant to the provisions of this Plan.

 

(b) “Base Price” means the price to be used as the basis for determining the
Spread upon the exercise of a Free-Standing Appreciation Right and a Tandem
Appreciation Right.

 

(c) “Board” means the Board of Directors of the Company and, to the extent of
any delegation by the Board to a committee (or subcommittee thereof) pursuant to
Section 14 of this Plan, such committee (or subcommittee).

 

(d) “Change in Control” has the meaning set forth in Section 11.

 

(e) “Code” means the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations thereunder, as such law, rules and
regulations may be amended from time to time.

 

(f) “Common Stock” means the Common Stock, par value $0.01 per share, of the
Company or any security into which such Common Stock may be changed by reason of
any transaction or event of the type referred to in Section 13 of this Plan.

 

(g) “Company” means U.S. Energy Corp., a Wyoming corporation, and its
successors.

 

(h) “Date of Grant” means the date specified by the Board on which a grant of
Options, Stock Appreciation Rights, Performance Shares, Performance Units or
other awards contemplated by Section 9 of this Plan, or a grant or sale of
Restricted Stock, Restricted Stock Units, or other awards contemplated by
Section 9 of this Plan, will become effective (which date will not be earlier
than the date on which the Board takes action with respect thereto).

 

(i) “Director” means a member of the Board of Directors of the Company.

 

(j) “Effective Date” means July 1, 2012. As amended, the Effective Date shall be
the later of (1) July 1, 2015, or (2) the date that shareholder approval is
obtained for the Amended and Restated 2012 Equity and Performance Incentive
Plan.

 

(k) “Eligible Individual” means an officer, employee, Director, or contractor of
the Company or any one or more of its Subsidiaries.

 

(l) “Evidence of Award” means an agreement, certificate, resolution or other
type or form of writing or other evidence approved by the Board that sets forth
the terms and conditions of the Awards granted. An Evidence of Award may be in
an electronic medium, may be limited to notation on the books and records of the
Company and, unless otherwise determined by the Board, need not be signed by a
representative of the Company or a Participant.

  

(m) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations thereunder, as such law, rules and regulations may be
amended from time to time.

 

   

 

 

(n) “Free-Standing Appreciation Right” means a Stock Appreciation Right granted
pursuant to Section 5 of this Plan that is not granted in tandem with an Option.

 

(o) “Incentive Stock Options” means Options that are intended to qualify as
“incentive stock options” under Section 422 of the Code or any successor
provision.

 

(p) “Management Objectives” means the measurable performance objective or
objectives established pursuant to this Plan for Participants who have received
grants of Performance Shares or Performance Units or, when so determined by the
Board, Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock
Units, dividend credits or other awards pursuant to this Plan. Management
Objectives may be described in terms of Company-wide objectives or objectives
that are related to the performance of the individual Participant or of the
Subsidiary, division, department, region or function within the Company or
Subsidiary in which the Participant is employed. The Management Objectives may
be made relative to the performance of one or more other companies or
subsidiaries, divisions, departments, regions or functions within such other
companies, and may be made relative to an index of one or more of the
performance objectives themselves.

 

If the Board determines that a change in the business, operations, corporate
structure or capital structure of the Company, or the manner in which it
conducts its business, or other events or circumstances render the Management
Objectives unsuitable, the Board may in its discretion modify such Management
Objectives or the related level or levels of achievement, in whole or in part,
as the Board deems appropriate and equitable.

 

(q) “Market Value per Share” means, as of any particular date, the closing sale
price of a share of Common Stock as reported on the principal national
securities exchange on which the Common Stock is listed. If the Common Stock is
not traded on a given date, the Market Value per Share means the closing price
for a share of Common Stock on the principal national securities exchange on
which the Common Stock is traded for the immediately preceding date on which the
Common Stock is traded. If the Common Stock is not listed on a national
securities exchange, the Market Value per Share shall be the fair market value
of a share of Common Stock as determined in good faith by the Board in
accordance with the fair market value pricing rules set forth in Section 409A of
the Code.

 

(r) “Optionee” means the Eligible Individual named in an Evidence of Award
evidencing an outstanding Option.

 

(s) “Option Price” means the purchase price per Share payable on exercise of an
Option.

 

(t) “Option” means an option to purchase Common Stock granted pursuant to
Section 4 of this Plan.

 

(u) “Participant” means an Eligible Individual who has received an Award under
this Plan.

 

(v) “Performance Period” means, in respect of a Performance Share or Performance
Unit, a period of time established pursuant to Section 8 of this Plan within
which the Management Objectives relating to such Performance Share or
Performance Unit are to be measured.

 

(w) “Performance Share” means a bookkeeping entry that records the equivalent of
one share of Common Stock awarded pursuant to Section 8 of this Plan.

 

(x) “Performance Unit” means a bookkeeping entry awarded pursuant to Section 8
of this Plan that records a unit equivalent to $1.00 or such other value as is
determined by the Board.

 

(y) “Plan” means this U.S. Energy Corp. 2012 Equity and Performance Incentive
Plan, as may be amended from time to time.

 

(z) “Restricted Stock” means Common Stock granted or sold pursuant to Section 6
of this Plan as to which the applicable Restriction Period has not yet lapsed.

  

   

 

 

(aa) “Restriction Period” means the period of time during which Restricted Stock
is subject to a substantial risk of forfeiture or Restricted Stock Units are
subject to restrictions, as provided in Section 6 and Section 7 of this Plan.

 

(bb) “Restricted Stock Unit” means an award made pursuant to Section 7 of this
Plan of the right to receive Common Stock or cash at the end of a specified
period.

 

(cc) “Share” means one share of Common Stock.

 

(dd) “Spread” means, on any applicable measurement date, the excess of the
Market Value per Share over the Option Price or Base Price provided for in an
Option or Stock Appreciation Right, respectively.

 

(ee) “Separation from Service” means a Participant’s Termination of Employment
with the Company and any of its Subsidiaries or affiliates that qualifies as a
“separation from service” for purposes of Section 409A of the Code. A Separation
from Service will be deemed to occur where the Participant and the Company, its
Subsidiary or affiliate, reasonably anticipate that the bona fide level of
services the Participant will perform (whether as an employee or as an
independent contractor) will be permanently reduced to a level that is less than
thirty-seven and a half percent (37.5%) of the average level of bona fide
services the Participant performed during the immediately preceding 36 months
(or the entire period the Participant has provided services if the Participant
has been providing services to the Company and any of its Subsidiaries or
affiliates for less than 36 months).

 

(ff) “Stock Appreciation Right” means a right granted pursuant to Section 5 of
this Plan, and includes both Tandem Appreciation Rights and Free-Standing
Appreciation Rights.

 

(gg) “Subsidiary” means a corporation, company or other entity (i) more than 50
percent of whose outstanding shares or securities (representing the right to
vote for the election of directors or other managing authority) are, or (ii)
which does not have outstanding shares or securities (as may be the case in a
partnership, joint venture or unincorporated association), but more than 50
percent of whose ownership interest representing the right generally to make
decisions for such other entity is, now or hereafter, owned or controlled,
directly or indirectly, by the Company except that for purposes of determining
whether any person may be a Participant for purposes of any grant of Incentive
Stock Options, “Subsidiary” means any corporation in which at the time the
Company owns or controls, directly or indirectly, more than 50 percent of the
total combined voting power represented by all classes of stock issued by such
corporation.

  

(hh) “Tandem Appreciation Right” means a Stock Appreciation Right granted
pursuant to Section 5 of this Plan that is granted in tandem with an Option.

 

(ii) “Termination of Employment” means the termination of a Participant’s
employment with, or performance of services for, the Company and any of its
Subsidiaries or affiliates. Unless otherwise determined by the Board, if a
Participant’s employment with the Company and its affiliates terminates but such
Participant continues to provide services to the Company and its affiliates in a
non-employee capacity, such change in status shall not be deemed a Termination
of Employment. A Participant shall be deemed to incur a Termination of
Employment in the event of the disaffiliation of such Participant’s subsidiary,
affiliate, or division unless the Board specifies otherwise. Temporary absences
from employment because of illness, vacation or leave of absence and transfers
among the Company and its Subsidiaries and affiliates do not constitute a
Termination of Employment. If an Award is subject to Section 409A of the Code,
however, Termination of Employment for purposes of that Award shall mean the
Participant’s Separation from Service.

 

3. Shares Available Under the Plan.

 

(a) Maximum Shares Available Under Plan.

 

  (i) Subject to adjustment as provided in Section 13 of this Plan, a maximum of
277,101 shares of Common Stock may be delivered pursuant to Awards granted under
this Plan.

 

   

 

 

  (ii) Shares of Common Stock covered by an Award shall not be counted as used
unless and until they are actually issued to a Participant and, therefore, the
total number of shares of Common Stock available under the Plan as of a given
date shall not be reduced by any Common Stock relating to prior Awards that have
expired or have been forfeited or cancelled. If the Award is to be settled in
cash, the number of shares of Common Stock on which the Award is based shall not
count toward the share limits set forth in this Section 3. Notwithstanding
anything to the contrary contained herein: (A) if shares of Common Stock are
tendered or otherwise used in payment of the Option Price of an Option or the
Base Price of a Stock Appreciation Right, the total number of shares of Common
Stock covered by the Option or Stock Appreciation Right being exercised shall
count against the aggregate Plan limit described above and (B) shares of Common
Stock withheld by the Company to satisfy the tax withholding obligation shall
count against the aggregate Plan limit described above.

 

(b) Limitations on Grants to Individual Participant.

 

  (i) Subject to adjustment as provided in Section 13 of this Plan, the maximum
number of shares with respect to which Awards may be granted hereunder to any
Participant or Director during any fiscal year of the Company shall be 150,000
shares (the “Limitation”). If an Option is canceled, the canceled Option shall
continue to be counted toward the Limitation for the year granted. An Option (or
a Stock Appreciation Right) that is repriced during any fiscal year is treated
as the cancellation of the Option (or Stock Appreciation Right) and grant of new
Option (or Stock Appreciation Right) for purposes of the Limitation for that
fiscal year.

 

4. Options. The Board may, from time to time and upon such terms and conditions
as it may determine, grant to Eligible Individuals options to purchase Common
Stock. Each grant of Options will be evidenced by an Evidence of Award which
shall contain such terms and conditions as the Board may approve that are not
inconsistent with the following terms and conditions and those of the remainder
of the Plan:

 

(a) Each Evidence of Award will specify the number of shares of Common Stock to
which it pertains subject to the limitations set forth in Section 3 of this
Plan.

 

(b) Each Evidence of Award will specify an Option Price per share, which may not
be less than the Market Value per Share on the Date of Grant (or 110% of the
Market Value Per Share in the case of an Incentive Stock Option issued to the
owner of 10% or more of the voting power of the Company or any of its
Subsidiaries).

 

(c) Each Evidence of Award will specify whether the Option Price will be
payable, to the extent permitted by applicable statutes and regulations, either
(a) in cash or by certified or bank check at the time the Option is exercised or
(b) in the discretion of the Committee, in any form of lawful consideration
approved by the Committee. As of the Effective Date (and subject to any future
action by the Committee to restrict the forms of consideration that may be used
to pay the Option Price) the Committee has approved the following:: (i) by
delivery to the Company of other Common Stock, duly endorsed for transfer to the
Company, with a Market Value per Share on the date of delivery equal to the
Option Price (or portion thereof) due for the number of Shares being acquired,
or by means of attestation whereby the Participant identifies for delivery
specific shares of Common Stock that have an aggregate Market Value per Share on
the date of attestation equal to the Option Price (or portion thereof) and
receives a number of shares of Common Stock equal to the difference between the
number of shares thereby purchased and the number of identified attestation
shares of Common Stock; (ii) a “cashless” exercise program established with a
broker; (iii) reduction in the number of shares of Common Stock otherwise
deliverable upon exercise of such Option with a Market Value per Share equal to
the aggregate Option Price at the time of exercise; (iv) any combination of the
foregoing methods; or (v) any other form of legal consideration that may be
acceptable to the Committee including but not limited to “net” or “immaculate”
exercise. Unless otherwise specifically provided in the Evidence of Award, the
exercise price of Common Stock acquired pursuant to an Option that is paid by
delivery (or attestation) to the Company of other Common Stock acquired,
directly or indirectly from the Company, shall be paid only by shares of Common
Stock of the Company that have been held for more than six months (or such
longer or shorter period of time required to avoid a charge to earnings for
financial accounting purposes). Notwithstanding the foregoing, during any period
for which the Common Stock is publicly traded (i.e., the Common Stock is listed
on any established stock exchange or a national market system) an exercise by a
Director or officer that involves or may involve a direct or indirect extension
of credit or arrangement of an extension of credit by the Company, directly or
indirectly, in violation of Section 402(a) of the Sarbanes-Oxley Act of 2002
shall be prohibited with respect to any Award under this Plan.

 

   

 

 

(d) Successive grants may be made to the same Participant whether or not any
Options previously granted to such Participant remain unexercised.

 

(e) Each Evidence of Award will specify the period or periods of continuous
service by the Optionee with the Company or any Subsidiary, if any, that is
necessary before the Options or installments thereof will become exercisable.
The Evidence of Award may provide for the earlier exercisability of such Options
in the event of the retirement, death or disability of a Participant, or a
Change of Control.

 

(f) Any Evidence of Award Option may specify Management Objectives that must be
achieved as a condition to the Options becoming exercisable.

  

(g) Options granted under this Plan may be (i) options, including, without
limitation, Incentive Stock Options that are intended to qualify under
particular provisions of the Code, (ii) options that are not intended so to
qualify, or (iii) combinations of the foregoing. Incentive Stock Options shall
be designated as such in the Evidence of Award and may only be granted to
Participants who meet the definition of “employees” under Section 3401(c) of the
Code.

 

(h) No grant of Options may be accompanied by a tandem award of dividend
equivalents or provide for dividends, dividend equivalents or other
distributions to be paid on such Options.

 

(i) The exercise of an Option will result in the cancellation on a share
for-share basis of any Tandem Appreciation Right authorized under Section 5 of
this Plan.

 

(j) Each Evidence of Award shall specify the period during which the Option may
be exercisable; provided, however that no Option will be exercisable more than
10 years from the Date of Grant (5 years for any Incentive Stock Option issued
to any owner of 10% or more of the outstanding voting securities of the Company
or any of its Subsidiaries). Each Evidence of Award may provide for accelerated
expiration of the Option upon the Participant’s Termination of Employment.

 

5. Stock Appreciation Rights.

 

(a) The Board may, from time to time and upon such terms and conditions as it
may determine, authorize the granting (i) to any Optionee, of Tandem
Appreciation Rights in respect of Options granted hereunder, or (ii) to any
Eligible Individual, of Free-Standing Appreciation Rights. A Tandem Appreciation
Right will be a right of the Optionee, exercisable by surrender of the related
Option, to receive from the Company an amount determined by the Board, which
will be expressed as a percentage of the Spread (not exceeding 100 percent) of
the Tandem Appreciation Right at the time of exercise. Tandem Appreciation
Rights may be granted at any time prior to the exercise or termination of the
related Options; provided, however, that a Tandem Appreciation Right awarded in
relation to an Incentive Stock Option must be granted concurrently with such
Incentive Stock Option. A Free-Standing Appreciation Right will be a right of
the Participant to receive from the Company an amount determined by the Board,
which will be expressed as a percentage of the Spread (not exceeding 100
percent) of the Free Standing Appreciation Right at the time of exercise.

 

(b) Each grant of Stock Appreciation Rights will be evidenced by an Evidence of
Award which shall identify the Stock Appreciation Right as a Free-Standing
Appreciation Right or a Tandem Appreciation Right (and in the case of Tandem
Appreciation Rights shall identify the related Option) and shall contain such
terms and conditions as the Board may approve that are not inconsistent with the
following terms and conditions of this section and section 5(c) and 5(d) below
(as applicable), and those of the remainder of the Plan:

 

  (i) Each Evidence of Award shall specify the amount payable upon exercise of
the Stock Appreciation Right and may provide that such may be paid by the
Company in cash, in Common Stock or in any combination thereof and may retain in
the Board the right to elect among those alternatives.

 

   

 

 

  (ii) Any Evidence of Award may specify that the amount payable on exercise of
a Stock Appreciation Right may not exceed a maximum specified by the Board at
the Date of Grant.         (iii) No grant of Stock Appreciation Rights may be
accompanied by a tandem award of dividend equivalents or provide for dividends,
dividend equivalents or other distributions to be paid on such Stock
Appreciation Rights.

  

(c) Each Evidence of Award of Tandem Appreciation Rights shall specify the Base
Price of such Tandem Appreciation Rights (which shall generally equal the Option
Price of the Related Option) and will provide that such Tandem Appreciation
Rights may be exercised only at a time and during the period when the related
Option is also exercisable and at a time when the Spread is positive, and by
surrender of the related Option for cancellation. Successive grants of Tandem
Appreciation Rights may be made to the same Participant regardless of whether
any Tandem Appreciation Rights previously granted to the Participant remain
unexercised.

 

(d) Regarding Free-Standing Appreciation Rights only:

 

  (i) Each Evidence of Award will specify in respect of each Free-Standing
Appreciation Right a Base Price, which will be equal to or greater than the
Market Value per Share on the Date of Grant;         (ii) Each Evidence of Award
will specify the period or periods of continuous service by the Participant with
the Company or any Subsidiary, if any, that is necessary before the
Free-Standing Appreciation Right or installments thereof will become
exercisable. The Evidence of Award may provide for the earlier exercisability of
such Free-Standing Appreciation Rights in the event of the retirement, death or
disability of a Participant, or a Change of Control;         (iii) Any Evidence
of Award of Free-Standing Appreciation Rights may specify Management Objectives
that must be achieved as a condition of the Free-Standing Appreciation Rights
becoming exercisable;         (iv) Each Evidence of Award shall specify the
period during which the Free-Standing Appreciation Right may be exercisable;
provided, however that no Free-Standing Appreciation Right will be exercisable
more than 10 years from the Date of Grant. Each Evidence of Award may provide
for accelerated expiration of the Free-Standing Appreciation Right upon the
Participant’s Termination of Employment; and         (v) Successive grants of
Free-Standing Appreciation Rights may be made to the same Participant regardless
of whether any Free-Standing Appreciation Rights previously granted to the
Participant remain unexercised.

 

6. Restricted Stock. The Board may, from time to time and upon such terms and
conditions as it may determine, grant or sell Restricted Stock to Participants.
Each grant or sale of Restricted Stock will be evidenced by an Evidence of Award
which shall contain such terms and conditions as the Board may approve that are
not inconsistent with the following terms and conditions and those of the
remainder of the Plan:

 

(a) Each such grant or sale will constitute an immediate transfer of the
ownership of Common Stock to the Participant in consideration of the performance
of services, entitling such Participant to voting, dividend and other ownership
rights, but subject to the substantial risk of forfeiture and restrictions on
transfer hereinafter referred to.

  

(b) Each such grant or sale may be made without additional consideration or in
consideration of a payment by such Participant that is less than or equal to the
Market Value per Share at the Date of Grant.

 

(c) Each Evidence of Award will provide that the Restricted Stock covered by
such grant or sale will be subject to a “substantial risk of forfeiture” within
the meaning of Section 83 of the Code during the Restriction Period, which
“substantial risk of forfeiture” may lapse upon the passage of time and/or upon
achievement of Management Objectives referred to in subparagraph (e) below.

 

   

 

 

(d) Each such grant or sale will provide that during the Restriction Period for
which such substantial risk of forfeiture is to continue, the transferability of
the Restricted Stock will be prohibited or restricted in the manner and to the
extent prescribed by the Board in the Evidence of Award (which restrictions may
include, without limitation, rights of repurchase or first refusal in the
Company or provisions subjecting the Restricted Stock to a continuing
substantial risk of forfeiture in the hands of any transferee).

 

(e) Any Evidence of Award may specify Management Objectives that, if achieved,
will result in termination or early termination of the restrictions applicable
to such Restricted Stock. Each Evidence of Award may specify in respect of such
Management Objectives a minimum acceptable level of achievement and may set
forth a formula for determining the number of shares of Restricted Stock on
which restrictions will terminate if performance is at or above the minimum or
threshold level or levels, or is at or above the target level or levels, but
falls short of maximum achievement of the specified Management Objectives.

 

(f) Notwithstanding anything to the contrary contained in this Plan, any
Evidence of Award may provide for the earlier termination of restrictions on
such Restricted Stock in the event of the retirement, death or disability of a
Participant, or a Change of Control.

 

(g) Any such grant or sale of Restricted Stock may require that any or all
dividends or other distributions paid thereon during the Restriction Period be
subject to the same restrictions as the underlying award and/or reinvested or
deemed reinvested in additional shares of Restricted Stock. In the event such
dividends are not reinvested or deemed reinvested in additional shares of
Restricted Stock, they shall be paid in cash (without interest) on the date on
which the Restricted Period lapses.

 

(h) Unless otherwise directed by the Board, (i) all certificates representing
shares of Restricted Stock will be held in custody by the Company until all
restrictions thereon will have lapsed, together with a stock power or powers
executed by the Participant in whose name such certificates are registered,
endorsed in blank and covering such Shares, or (ii) all shares of Restricted
Stock will be held at the Company’s transfer agent in book entry form with
appropriate restrictions relating to the transfer of such shares of Restricted
Stock.

 

7. Restricted Stock Units. The Board may, from time to time and upon such terms
and conditions as it may determine, grant Restricted Stock Units to Eligible
Individuals. Each grant of Restricted Stock Units will be evidenced by an
Evidence of Award which shall contain such terms and conditions as the Board may
approve that are not inconsistent with the following terms and conditions and
those of the remainder of the Plan:

 

(a) Each such grant will constitute the agreement by the Company to deliver one
share of Common Stock per Restricted Stock Unit (or to deliver the cash
equivalent thereof) to the Participant in the future in consideration of the
performance of services, but subject to the fulfillment of such conditions
(which may include the achievement of Management Objectives) during the
Restriction Period as the Board may specify in the Evidence of Award. Each
Evidence of Award may specify in respect of such Management Objectives a minimum
acceptable level of achievement and may set forth a formula for determining the
number of Common Shares subject to the Restricted Stock Units as to which
restrictions will terminate if performance is at or above the minimum or
threshold level or levels, or is at or above the target level or levels, but
falls short of maximum achievement of the specified Management Objectives.

  

(b) Notwithstanding anything to the contrary contained in this Plan, any
Evidence of Award may provide for the earlier lapse or modification of the
Restriction Period in the event of the retirement, death or disability of a
Participant, or a change of Control.

 

(c) During the Restriction Period, the Participant will have no right to
transfer any rights under his or her award and will have no rights of ownership
in the Restricted Stock Units and will have no right to vote the Common Shares
subject to the Restricted Stock Units, but the Board may in the Evidence of
Award authorize the payment of dividend equivalents on either a current,
deferred or contingent basis, either in cash or in additional shares of Common
Stock, provided that dividend equivalents shall not be paid in a manner that
would cause any tax to be due under 409A of the Code.

 

   

 

 

(d) Each Evidence of Award Unit will specify the time and manner of payment of
the Restricted Stock Units that have been earned. Each Evidence of Award will
specify that the amount payable with respect thereto will be paid by the Company
in Common Stock or cash. If a cash payment is made in lieu of delivering shares
of Common Stock, the amount of such payment shall be based on the Market Value
per Share as of the date on which the Restriction Period lapsed with respect to
each Restricted Stock Unit.

 

8. Performance Shares and Performance Units. The Board may, from time to time
and upon such terms and conditions as it may determine, grant Performance Shares
and Performance Units that will become payable to a Participant upon achievement
of specified Management Objectives during the Performance Period. Each grant or
sale of Performance Shares and Performance Units will be evidenced by an
Evidence of Award which shall contain such terms and conditions as the Board may
approve that are not inconsistent with the following terms and conditions and
those of the remainder of the Plan:

 

(a) Each Evidence of Award will specify the number of Performance Shares or
Performance Units to which it pertains, which number may be subject to
adjustment to reflect changes in compensation or other factors.

 

(b) The Performance Period with respect to each Performance Share or Performance
Unit will be such period of time as will be determined by the Board at the time
of grant, and may be subject to earlier lapse or other modification in the event
of the retirement, death or disability of a Participant, or a Change of Control.

 

(c) Any Evidence of Award will specify Management Objectives which, if achieved,
will result in payment or early payment of the award, and each Evidence of Award
may specify in respect of such Management Objectives a minimum acceptable level
of achievement and may set forth a formula for determining the number of
Performance Shares or Performance Units that will be earned if performance is at
or above the minimum or threshold level or levels, or is at or above the target
level or levels, but falls short of maximum achievement of the specified
Management Objectives. The grant of Performance Shares or Performance Units will
specify that, before the Performance Shares or Performance Units will be earned
and paid, the Board must certify that the Management Objectives have been
satisfied.

 

(d) Each Evidence of Award will specify the payment to be made pursuant to any
award of Performance Shares or Performance Units and the time and manner of such
payment. Any Evidence of Award may specify that the amount payable with respect
thereto may be paid by the Company in cash, in Common Stock or in any
combination thereof and may retain in the Board the right to elect among those
alternatives.

  

(e) Any Evidence of Award may specify that the amount payable or the number of
shares of Common Stock issued with respect thereto may not exceed maximums
specified by the Board at the Date of Grant.

 

(f) The Evidence of Award may provide for the payment of dividend equivalents to
the holder thereof either in cash or in additional shares of Common Stock
subject in all cases to payment on a contingent basis based on the Participant’s
earning of the Performance Shares with respect to which such dividend
equivalents are paid, provided that dividend equivalents shall not be paid in a
manner that would cause any tax to be due under 409A of the Code.

 

9. Other Awards.

 

(a) The Board may, subject to limitations under applicable law, grant to any
Eligible Individual such other awards that may be denominated or payable in,
valued in whole or in part by reference to, or otherwise based on, or related
to, shares of Common Stock or factors that may influence the value of such
shares, including, without limitation, convertible or exchangeable debt
securities, other rights convertible or exchangeable into Common Stock, purchase
rights for Common Stock, awards with value and payment contingent upon
performance of the Company or specified Subsidiaries, affiliates or other
business units thereof or any other factors designated by the Board, and awards
valued by reference to the book value of shares of Common Stock or the value of
securities of, or the performance of specified Subsidiaries or affiliates or
other business units of the Company. The Board shall determine the terms and
conditions of such awards. Shares of Common Stock delivered pursuant to an award
in the nature of a purchase right granted under this Section 9 shall be
purchased for such consideration, paid for at such time, by such methods, and in
such forms, including, without limitation, cash, shares of Common Stock, other
awards, notes or other property, as the Board shall determine.

 

   

 

 

(b) Cash awards, as an element of or supplement to any other award granted under
this Plan, may also be granted pursuant to this Section 9 of this Plan.

 

(c) The Board may grant Common Stock as a bonus, or may grant other awards in
lieu of obligations of the Company or a Subsidiary to pay cash or deliver other
property under this Plan or under other plans or compensatory arrangements,
subject to such terms as shall be determined by the Board in a manner that
complies with Section 409A of the Code.

 

(d) Share-based awards pursuant to this Section 9 are not required to be subject
to any minimum vesting period.

 

10. Transferability.

 

(a) Except as otherwise determined by the Board, no Option, Stock Appreciation
Right or other Award shall be transferable by the Participant except by will or
the laws of descent and distribution, and in no event shall any such Award be
transferred for value. Except as otherwise determined by the Board, Options and
Stock Appreciation Rights will be exercisable during the Participant’s lifetime
only by him or her or, in the event of the Participant’s legal incapacity to do
so, by his or her guardian or legal representative acting on behalf of the
Participant in a fiduciary capacity under state law and/or court supervision.

 

(b) Any Evidence of Award may provide that part or all of the shares of Common
Stock that are (i) to be issued or transferred by the Company upon (A) the
exercise of Options or Stock Appreciation Rights, (B) upon the termination of
the Restriction Period applicable to Restricted Stock Units or (C) upon payment
under any grant of Performance Shares or Performance Units or (ii) no longer
subject to the substantial risk of forfeiture and restrictions on transfer
referred to in Section 6 of this Plan, will be subject to further restrictions
on transfer that are consistent with applicable law.

  

11. Change in Control.

 

(a) In the event of a Change in Control, but notwithstanding any other provision
of the Plan to the contrary, the Board may, in its discretion, take any of the
actions listed in this Section 11.

 

  (i) provide that any Options and Stock Appreciation Rights outstanding which
are not then exercisable and vested shall become immediately vested and fully
exercisable;         (ii) provide that any Restricted Stock, Restricted Stock
Unit and other Awards shall become vested in full;         (iii) provide that
Performance Criteria applicable to Performance Shares and Performance Units or
Management Objectives applicable to other Awards shall be deemed to be satisfied
and such Awards shall be considered to be earned and payable in full;        
(iv) provide for the assumption or substitution of equal or greater value of any
Award on such terms and conditions as the Board deems appropriate and consistent
with Section 409A of the Code;         (v) make such settlements of outstanding
Awards as it deems appropriate, including, without limitation, the cancellation
of outstanding Awards in exchange for payments of cash, property or a
combination thereof having an aggregate value equal to the value of such Awards,
as determined by the Board in its sole discretion; and         (vi) provide for
the cancellation without payment of each Option or Stock Appreciation Right or
other Award with an Option Price or Base Price (or similar amount) greater than
the consideration offered in connection with any such Change in Control.

 

   

 

 

  (a) The Board’s actions need not be uniform, and may result in disparate
treatment among Participants, Awards, and portions of the same Award, as the
Board determines in its sole and absolute discretion.         (b)
Notwithstanding the foregoing, in the event the Board does not, for any reason,
provide for the assumption or substitution with an award of equal or greater
value of any Award (or portion thereof) pursuant to the Change in Control
transaction, such Award (or portion thereof) shall become vested in full
immediately prior to such Change in Control.         (c) To the extent the Board
provides for the assumption or substitution with an award of equal or greater
value of an outstanding Award (or portion thereof), then, to the extent not
otherwise vested by the Board in accordance with the provisions of this Section
11 and notwithstanding any other provision of this Plan to the contrary, during
the 12-month period following a Change in Control: (i) upon the involuntary
termination of an Optionee or Participant’s employment other than termination
for Cause; (ii) upon the voluntary termination of employment by the Participant
following a material and adverse change in the Optionee or Participant’s
compensation, responsibilities, functions or reporting relationship; or (iii) in
the event an Optionee or Participant resigns rather than accept a mandatory
relocation greater than 50 miles; then, in any such event, all outstanding
Awards held by such Optionee or Participant shall become vested as of the Date
of Termination. Any Option or Stock Appreciation Right held by the Optionee or
Participant as of the date of the Change in Control that remains outstanding as
of the date of Termination of Employment may thereafter be exercised, until the
earlier of (i) the third anniversary of the date of Termination of Employment;
or (ii) the expiration of the Term of such Option or Stock Appreciation Right.
Restricted Stock shall immediately be vested free and transferable. Restricted
Stock Units, Performance Shares, Performance Units and other Awards shall be
vested as of the Termination of Employment and settled as soon as practicable as
specified in the Evidence of Award; provided, however, that if the Award is
subject to Section 409A and the Optionee or Participant is a Specified Employee,
the Award shall be settled on the first day of the seventh month following the
Participant’s Termination of Employment.

  

  (d) For purposes of the Plan, a “Change in Control” shall mean any of the
following events:

 

  (i) The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”)) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 25% or more of the then-outstanding Shares of Common Stock plus any other
outstanding shares of stock of the Corporation entitled to vote in the election
of directors (the “Outstanding Company Voting Securities”); provided, however,
that the Company and any employee benefit plan (or related trust) sponsored by
it shall not be deemed to be a Person; or         (ii) A change in the
composition of the Board such that the individuals who constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board. For this purpose, any individual whose election or nomination for
election by the Company’s shareholders was approved by a vote of at least
two-thirds of the directors then comprising the Incumbent Board shall be
considered a member of the Incumbent Board; or         (iii) The consummation of
a reorganization, merger, statutory share exchange or consolidation or similar
corporate transaction involving the Company or any of its Subsidiaries or a sale
or other disposition of substantially all of the assets of the Company or a
material acquisition of assets or stock of another entity by the Company or any
of its Subsidiaries, (each, a “Business Combination”) if:

 

   

 

 

  (A) the individuals and entities that were the beneficial owners of the
Outstanding Company Voting Securities immediately prior to such Business
Combination do not beneficially own, directly or indirectly, more than 50% of
the then-outstanding shares of stock and the combined voting power of the
then-outstanding voting securities of the corporation resulting from such
Business Combination; or         (B) a Person beneficially owns, directly or
indirectly, 25% or more of the then-outstanding shares of stock of the
corporation resulting from such Business Combination; or         (C) members of
the Incumbent Board do not comprise at least a majority of the members of the
board of directors of the corporation resulting from such Business Combination;
or

 

  (iv) A complete liquidation or dissolution of the Company.

 

  (e) If an Award is subject to Section 409A of the Code, any provision
regarding the timing or form of payment upon a Change in Control shall be set
forth in the Award Agreement when the Award is granted. The payment or
settlement of any such Award that is subject to Section 409A of the Code shall
accelerate upon a Change in Control only if the event also constitutes a “change
in ownership,” “change in effective control,” or “change in the ownership of a
substantial portion of the Company’s assets” as defined under Section 409A of
the Code. Any adjustment to the Award that does not affect the Award’s status
under Section 409A (including, but not limited to, accelerated vesting or
adjustment of the amount of the Award) may occur upon a Change-in-Control as
defined in the Plan without regard to this paragraph, even if the event does not
constitute a “change in ownership,” “change in effective control,” or “change in
the ownership of a substantial portion of the Company’s assets” under Section
409A.

 

12. Securities Act Compliance.

 

(a) If the Board deems it necessary to comply with the Securities Act of 1933,
as amended, and the regulations and rulings thereunder, the Board may require a
written investment intent representation by the Optionee or Participant and may
require a restrictive legend be affixed to certificates for shares of Common
Stock.

 

(b) If, based upon the opinion of counsel for the Company, the Committee
determines that the exercise or nonforfeitability of, or delivery of benefits
pursuant to, any Award would violate any applicable provision of (i) U.S.
federal, state or local securities law or (ii) the listing requirements of any
national securities exchange on which are listed any of the Company’s equity
securities, then the Committee may postpone any such exercise, nonforfeitability
or delivery, as the case may be, until such provisions would be satisfied.
Nothing herein shall require the Company to take any actions to cause such
exercise, nonforfeitability or delivery to comply with all such provisions.

 

13. Adjustments. The Board shall make or provide for such adjustments in the
numbers of shares of Common Stock covered by outstanding Awards, the Option
Price of Options and the Base Price of Stock Appreciation Rights, Options and in
the kind of shares covered thereby, as the Board, in its sole discretion,
exercised in good faith, may determine is equitably required to prevent dilution
or enlargement of the rights of Participants or Optionees that otherwise would
result from (a) any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Company, (b)
any merger, consolidation, spin-off, split-off, spin-out, split-up,
reorganization, partial or complete liquidation or other distribution of assets,
issuance of rights or warrants to purchase securities, or (c) any other
corporate transaction or event having an effect similar to any of the foregoing.
The Board shall also make or provide for such adjustments in the numbers of
shares of Common Stock specified in Section 3 of this Plan as the Board in its
sole discretion, exercised in good faith, may determine is appropriate to
reflect any transaction or event described in this Section 13; provided,
however, that any such adjustment to the number specified in Section 3(a)(i)
will be made only if and to the extent that such adjustment would not cause any
Option intended to qualify as an Incentive Stock Option to fail to so qualify.

  

   

 

 

14. Administration of the Plan.

 

(a) This Plan will be administered by the Board, which may from time to time
delegate all or any part of its authority under this Plan to the Compensation
Committee (the “Committee”) of the Board (or a subcommittee thereof), as
constituted from time to time. To the extent of any such delegation, references
in this Plan to the Board will be deemed to be references to such Committee or
subcommittee. A majority of the Board or Committee (or subcommittee), as
applicable, will constitute a quorum, and the action of the members of the Board
or Committee (or subcommittee) present at any meeting at which a quorum is
present, or acts unanimously approved in writing, will be the acts of the Board
or Committee (or subcommittee).

 

(b) The interpretation and construction by the Board of any provision of this
Plan or of any agreement, notification or document evidencing the grant of
Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Shares, Performance Units or other awards pursuant to Section 9 of
this Plan and any determination by the Board pursuant to any provision of this
Plan or of any such agreement, notification or document will be final and
conclusive. No member of the Board will be liable for any such action or
determination made in good faith.

 

(c) The Board or, to the extent of any delegation as provided in Section 14(a),
the Committee, may delegate to one or more of its members or to one or more
officers of the Company, or to one or more agents or advisors, such
administrative duties or powers as it may deem advisable, and the Board, the
committee, or any person to whom duties or powers have been delegated as
aforesaid, may employ one or more persons to render advice with respect to any
responsibility the Board, the Committee or such person may have under the Plan.
The Board or the Committee may, by resolution and consistent with applicable
law, authorize one or more officers of the Company to do one or both of the
following on the same basis as the Board or the Committee: (i) designate
employees to be recipients of awards under this Plan; (ii) determine the size of
any such awards; provided, however, that (A) the Board or the Committee shall
not delegate such responsibilities to any such officer for awards granted to an
employee who is an officer, Director, or more than 10% beneficial owner of any
class of the Company’s equity securities that is registered pursuant to Section
12 of the Exchange Act, as determined by the Board in accordance with Section 16
of the Exchange Act; (B) the resolution providing for such authorization sets
forth the total number of shares of Common Stock such officer(s) may grant; and
(C) the officer(s) shall report periodically to the Board or the Committee, as
the case may be, regarding the nature and scope of the awards granted pursuant
to the authority delegated.

 

15. Clawback. Any benefits the Optionee or Participant may receive under this
Plan shall be subject to repayment or forfeiture as may be required to comply
with (i) any applicable listing standards of a national securities exchange
adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act (regarding recovery of erroneously awarded compensation)
and any implementing rules and regulations of the U.S. Securities and Exchange
Commission adopted thereunder, (ii) similar rules under the laws of any other
jurisdiction and (iii) any policies adopted by the Company to implement such
requirements, all to the extent determined by the Company in its discretion to
be applicable to the Optionee or Participant.

 

16. Recapture Provisions. Any Evidence of Award may provide for the cancellation
or forfeiture of an award or the forfeiture and repayment to the Company of any
gain related to an award, or other provisions intended to have a similar effect,
upon such terms and conditions as may be determined from time to time by the
Board.

  

17. Non U.S. Participants. In order to facilitate the making of any grant or
combination of grants under this Plan, the Board may provide for such special
terms for awards to Participants who are foreign nationals or who are employed
by the Company or any Subsidiary outside of the United States of America or who
provide services to the Company under an agreement with a foreign nation or
agency, as the Board may consider necessary or appropriate to accommodate
differences in local law, tax policy or custom. Moreover, the Board may approve
such supplements to or amendments, restatements or alternative versions of this
Plan (including without limitation, sub-plans) as it may consider necessary or
appropriate for such purposes, without thereby affecting the terms of this Plan
as in effect for any other purpose, and the Secretary or other appropriate
officer of the Company may certify any such document as having been approved and
adopted in the same manner as this Plan. No such special terms, supplements,
amendments or restatements, however, will include any provisions that are
inconsistent with the terms of this Plan as then in effect unless this Plan
could have been amended to eliminate such inconsistency without further approval
by the stockholders of the Company.

 

   

 

 

18. Withholding Taxes. To the extent that the Company is required to withhold
federal, state, local or foreign taxes in connection with any payment made or
benefit realized by a Participant or other person under this Plan, and the
amounts available to the Company for such withholding are insufficient, it will
be a condition to the receipt of such payment or the realization of such benefit
that the Participant or such other person make arrangements satisfactory to the
Company for payment of the balance of such taxes required to be withheld, which
arrangements (in the discretion of the Board) may include relinquishment of a
portion of such benefit. If a Participant fails to make arrangements for the
payment of tax, the Company may withhold such tax from any other form of
remuneration payable to the Participant, including, if it determines in its sole
and absolute discretion, from shares of Common Stock payable pursuant to the
Award having a value equal to the amount required to be withheld. When a
Participant is required to pay the Company an amount required to be withheld
under applicable income and employment tax laws, the Participant may elect to
satisfy the obligation, in whole or in part, by electing to have withheld, from
the shares required to be delivered to the Participant, shares of Common Stock
having a value equal to the amount required to be withheld, or by delivering to
the Company other shares of Common Stock held by such Participant. The shares
used for tax withholding will be valued at an amount equal to the Market Value
per Share of such Common Stock on the date the benefit is to be included in
Participant’s income. In no event shall the Market Value per Share of the Common
Stock to be withheld and delivered pursuant to this Section 18 to satisfy
applicable withholding taxes in connection with the benefit exceed the minimum
amount of taxes required to be withheld. Participants shall also make such
arrangements as the Company may require for the payment of any withholding tax
obligation that may arise in connection with the disposition of shares of Common
Stock acquired upon the exercise of Options.

 

19. Amendments, Termination Etc.

 

(a) The Board may at any time and from time to time amend the Plan in whole or
in part; provided, however, that if an amendment to the Plan (i) would
materially increase the benefits accruing to participants under the Plan, (ii)
would materially increase the number of securities which may be issued under the
Plan, (iii) would materially modify the requirements for participation in the
Plan or (iv) must otherwise be approved by the stockholders of the Company in
order to comply with applicable law or the rules of the principal national
securities exchange upon which the Common Stock is traded or quoted, then, such
amendment will be subject to stockholder approval and will not be effective
unless and until such approval has been obtained.

 

(b) Except in connection with a corporate transaction or event described in
Section 13 of this Plan, the terms of outstanding awards may not be amended to
reduce the Option Price of outstanding Options or the Base Price of outstanding
Stock Appreciation Rights, or cancel outstanding Options or Stock Appreciation
Rights in exchange for cash, other awards or Options or Stock Appreciation
Rights with an Option Price or Base Price, as applicable, that is less than the
Option Price of the original Options or Base Price of the original Stock
Appreciation Rights, as applicable, without stockholder approval.

  

(c) If permitted by Section 409A of the Code, but subject to Section 20d)
hereof, in case of termination of employment by reason of death, disability or
normal or early retirement, or in the case of unforeseeable emergency or other
special circumstances, of a Participant who holds an Option or Stock
Appreciation Right not immediately exercisable in full, or any shares of
Restricted Stock as to which the substantial risk of forfeiture or the
prohibition or restriction on transfer has not lapsed, or any Restricted Stock
Units as to which the Restriction Period has not been completed, or any
Performance Shares or Performance Units which have not been fully earned, or any
other awards made pursuant to Section 9 subject to any vesting schedule or
transfer restriction, or who holds Common Stock subject to any transfer
restriction imposed pursuant to Section 10(b) of this Plan, or in the case of a
change of control, the Board may, in its sole discretion, accelerate the time at
which such Option, Stock Appreciation Right or other award may be exercised or
the time at which such substantial risk of forfeiture or prohibition or
restriction on transfer will lapse or the time when such Restriction Period will
end or the time at which such Performance Shares or Performance Units will be
deemed to have been fully earned or the time when such transfer restriction will
terminate or may waive any other limitation or requirement under any such award.

 

   

 

 

(d) Subject to Section 20(b) hereof, the Board may amend the terms of any award
theretofore granted under this Plan prospectively or retroactively. Subject to
Section 13 above, no such amendment shall impair any material right of any
Participant without his or her consent. The Board may, in its discretion,
terminate this Plan at any time. Termination of this Plan will not affect the
rights of Participants or their successors under any awards outstanding
hereunder and not exercised in full on the date of termination.

 

20. Compliance with Section 409A of the Code.

 

(a) To the extent applicable, it is intended that this Plan and any grants made
hereunder comply with the provisions of Section 409A of the Code, so that the
income inclusion provisions of Section 409A(a)(1) of the Code do not apply to
the Participants. This Plan and any grants made hereunder shall be administered
in a manner consistent with this intent. Any reference in this Plan to Section
409A of the Code will also include any regulations or any other formal guidance
promulgated with respect to such Section by the U.S. Department of the Treasury
or the Internal Revenue Service.

 

(b) Neither a Participant nor any of a Participant’s creditors or beneficiaries
shall have the right to subject any deferred compensation (within the meaning of
Section 409A of the Code) payable under this Plan and grants hereunder 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 a Participant or for a Participant’s benefit under this Plan and
grants hereunder may not be reduced by, or offset against, any amount owing by a
Participant to the Company or any of its affiliates.

 

(c) If, at the time of a Participant’s separation from service (within the
meaning of Section 409A of the Code), (i) the 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 (ii)
the Company shall make a good faith determination that an amount payable
hereunder 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, without interest, on the earlier of the tenth business day following (i) the
seventh month after such Separation of Service, (ii) the Participant’s death,
(iii) or such earlier date or event on which such amount may be paid without
violating the provisions of Code Section 409A.

  

(d) Notwithstanding any provision of this Plan and grants hereunder 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
this Plan and grants hereunder 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 a Participant or
for a Participant’s account in connection with this Plan and grants hereunder
(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 a Participant harmless from any or all of such taxes or
penalties.

 

21. Code Section 162(m) Provisions.

 

(a) Covered Employees.

 

  (i) Notwithstanding any other provision of the Plan, if the Committee
determines that any Award is being granted to a Participant who is, or is likely
to be, as of the end of the tax year in which the Company would claim a tax
deduction in connection with such Award, a “covered employee” (within the
meaning of 162(m) (3) of the Code), then the Committee may provide that this
Section 21 is applicable to such Award.

 

   

 

 

(b) Performance Goals.

 

  (i) If an Award is subject to this Section 18, then the lapsing of
restrictions thereon and the distribution of Shares or other property pursuant
thereto, as applicable, shall be subject to the achievement of one or more
specified levels of Performance Criteria. Such Performance Criteria may be based
solely by reference to the Company’s performance or the performance of a
division or business unit of the Company, or based upon the relative performance
of other companies or upon comparisons of any of the indicators of performance
relative to other companies. The Committee may also exclude the impact of an
event or occurrence which the Committee determines should appropriately be
excluded, including (a) restructurings, discontinued operations, extraordinary
items, and other unusual or non-recurring charges, (b) an event either not
directly related to the operations of the Company or not within the reasonable
control of the Company’s management, or (c) a change in accounting standards
required by generally accepted accounting principles; provided that the
Committee may not make any adjustment to the extent it would adversely affect
the qualification of any compensation payable under such Performance Criteria as
“performance-based compensation” under Section 162(m). Such Performance Criteria
shall be set by the

 

Committee within the time period prescribed by, and shall otherwise comply with
the requirements of, Section 162(m) of the Code, or any successor provision
thereto, and the regulations thereunder. Before any payments are made with
respect to any Awards subject to this Section 21, the Committee shall certify in
writing whether and to what extent the Performance Criteria relating to such
payment have been met.

 

(c) Other Restrictions.

 

  (i) The Committee shall have the power to impose such other restrictions on
Awards subject to this Section 21 as it may deem necessary or appropriate to
ensure that such Awards satisfy all requirements for “performance-based
compensation” within the meaning of Section 162(m)(4)(C) of the Code, or any
successor provision thereto.

  

22. Code Section 280G Reduction in Awards.

 

(a) Notwithstanding anything to the contrary contained in this Plan, in the
event the Company determines, in its sole discretion, that any payment or
distribution by the Company to or for the benefit of any Participant (whether
paid or payable or distributed or distributable pursuant to the terms of this
Plan or otherwise) (collectively, “Payments”) would be subject to the excise tax
imposed by Section 4999 of the Code or any interest or penalties are incurred by
the Participant with respect to such excise tax (such excise tax, together with
any such interest and penalties, are hereinafter collectively referred to as the
“Excise Tax”), then there shall be made a calculation under which such Payments
provided to the Participant are reduced to the extent necessary so that no
portion thereof shall be subject to the Excise Tax (the “4999 Limit”). A
comparison shall then be made between (A) Participant’s Net After-Tax Benefit
(as defined below) assuming application of the 4999 Limit; and (B) Participant’s
Net After-Tax Benefit without application of the 4999 Limit. If (B) exceeds (A),
then no limit on the Payments received by Participant under this Agreement shall
be imposed by this Section 22. Otherwise, the amount payable to Executive
pursuant to this Agreement shall be reduced so that no such Payment is subject
to the Excise Tax. “Net After-Tax Benefit” shall mean the sum of (x) all
payments that Participant receives or is entitled to receive that are in the
nature of compensation and contingent on a change in the ownership or effective
control of the Company or in the ownership of a substantial portion of the
assets of the Company within the meaning of Code Section 280G(b)(2) (either, a
“Section 280G Transaction”), less (y) the amount of federal, state, local and
employment taxes and Excise Tax (if any) imposed with respect to such payments.

 

(b) In the event that a reduction in Payments is required pursuant to the
immediately preceding paragraph, then, except as provided below with respect to
Payments that consist of health and welfare benefits, the reduction in Payments
shall be implemented by determining the “Parachute Payment Ratio” (as defined
below) for each Payment and then reducing the Payments in order beginning with
the Payment with the highest Parachute Payment Ratio. For Payments with the same
Parachute Payment Ratio, such Payments shall be reduced based on the time of
payment of such Payments, with amounts being paid furthest in the future being
reduced first. For Payments with the same Parachute Payment Ratio and the same
time of payment, such Payments shall be reduced on a pro-rata basis (but not
below zero) prior to reducing Payments next in order for reduction. For purposes
of this Section, “Parachute Payment Ratio” shall mean a fraction, the numerator
of which is the value of the applicable Payment as determined for purposes of
Code Section 280G, and the denominator of which is the financial present value
of such Parachute Payment, determined at the date such payment is treated as
made for purposes of Code Section 280G (the “Valuation Date”). In determining
the denominator for purposes of the preceding sentence (1) present values shall
be determined using the same discount rate that applies for purposes of
discounting payments under Code Section 280G; (2) the financial value of
payments shall be determined generally under Q&A 12, 13 and 14 of Treasury
Regulation 1.280G-1; and (3) other reasonable valuation assumptions as
determined by Company shall be used. Notwithstanding the foregoing, Payments
that consist of health and welfare benefits shall be reduced after all other
Payments, with health and welfare Payments being made furthest in the future
being reduced first.

 

   

 

 

Notwithstanding the foregoing, if a Participant is a party to an employment or
other agreement with the Company or participates in a severance program
sponsored by the Company or one of its affiliates that contains express
provisions regarding Section 280G or Section 4999 of the Code (or any similar
successor provision), the Section 280G or Section 4999 provisions of such
employment or other agreement or plan, as applicable, shall control as to any
Payments due that Participant.

 

23. Governing Law. The Plan and all grants and awards and actions taken
thereunder shall be governed by and construed in accordance with the internal
substantive laws of the State of Wyoming.

  

24. Effective Date/Expiration. This Plan will be effective as of the Effective
Date, which is the date on which the Plan is adopted by the Board. The Plan
shall be submitted to the Company’s stockholders for approval. Unless the Plan
is approved by the Company’s stockholders within twelve (12) months before or
after the Effective Date, the Plan and all Awards made under it shall be void
and of no force and effect. No grant will be made under this Plan more than ten
(10) years from the date the Plan is adopted, or the date the Plan is approved
by the Company’s shareholders, whichever is earlier but all grants made on or
prior to such date will continue in effect thereafter subject to the terms
thereof and of this Plan. The provisions of this Section 24 shall be applied to
the Plan, as amended and restated, as if the Plan were originally established on
the date that the Amended and Restated 2012 Equity and Performance Incentive
Plan is adopted, and accordingly, the Plan will not expire until ten (10) years
following the date the Amended and Restated 2012 Equity and Performance
Incentive Plan is adopted.

 

25. Miscellaneous.

 

(a) The Company will not be required to issue any fractional shares of Common
Stock pursuant to this Plan. The Board may provide for the elimination of
fractions or for the settlement of fractions in cash.

 

(b) This Plan will not confer upon any Participant any right with respect to
continuance of employment or other service with the Company or any Subsidiary,
nor will it interfere in any way with any right the Company or any Subsidiary
would otherwise have to terminate such Participant’s employment or other service
at any time.

 

(c) To the extent that any provision of this Plan would prevent any Option that
was intended to qualify as an Incentive Stock Option from qualifying as such,
that provision will be null and void with respect to such Option. Such
provision, however, will remain in effect for other Options and there will be no
further effect on any provision of this Plan.

 

(d) No award under this Plan may be exercised by the holder thereof if such
exercise, and the receipt of cash or stock thereunder, would be, in the opinion
of counsel selected by the Board, contrary to law or the regulations of any duly
constituted authority having jurisdiction over this Plan.

 

(e) Absence or leave approved by a duly constituted officer of the Company or
any of its Subsidiaries shall not be considered interruption or termination of
service of any employee for any purposes of this Plan or awards granted
hereunder.

 

(f) No Participant shall have any rights as a stockholder with respect to any
shares subject to awards granted to him or her under this Plan prior to the date
as of which he or she is actually recorded as the holder of such shares upon the
stock records of the Company.

 

(g) The Board may, to the extent compliant with applicable law, condition the
grant of any award or combination of awards authorized under this Plan on the
surrender or deferral by the Participant of his or her right to receive a cash
bonus or other compensation otherwise payable by the Company or a Subsidiary to
the Participant.

 

(h) If any provision of the Plan is or becomes invalid, illegal or unenforceable
in any jurisdiction, or would disqualify the Plan or any award under any law
deemed applicable by the Board, such provision shall be construed or deemed
amended or limited in scope to conform to applicable laws or, in the discretion
of the Board, it shall be stricken and the remainder of the Plan shall remain in
full force and effect.