Exhibit 10.1

 

Cinedigm Corp.

2017 Incentive Plan

 

 

 

 

TABLE OF CONTENTS

 

    Page       Article 1. Establishment, Purpose, and Duration 1       Article
2. Definitions 1       Article 3. Administration 7       Article 4. Shares
Subject to this Plan and Maximum Awards 8       Article 5. Eligibility and
Participation 10       Article 6. Stock Options 10       Article 7. Stock
Appreciation Rights 12       Article 8. Restricted Stock and Restricted Stock
Units 13       Article 9. Performance Units/Performance Shares 15       Article
10. Cash-Based Awards and Other Stock-Based Awards 16       Article 11.
Transferability of Awards 16       Article 12. Performance Measures 17      
Article 13. Nonemployee Director Awards 19       Article 14. Minimum Vesting of
Share-Based Awards 19       Article 15. Dividend Equivalents 19       Article
16. Beneficiary Designation 20       Article 17. Rights of Participants 20      
Article 18. Change of Control 20       Article 19. Amendment, Modification,
Suspension, and Termination 22       Article 20. Withholding 23       Article
21. Successors 24       Article 22. General Provisions 24

 

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Cinedigm Corp.
2017 Incentive Plan

 

Article 1.Establishment, Purpose, and Duration

 

1.1         Establishment. Cinedigm Corp., a Delaware corporation (hereinafter
referred to as the “Company”), establishes an incentive compensation plan to be
known as the Cinedigm Corp. 2017 Incentive Plan (hereinafter referred to as the
“Plan”), as set forth in this document.

 

This Plan permits the grant of Nonqualified Stock Options, Incentive Stock
Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Shares, Performance Units, Cash-Based Awards, and Other Stock-Based
Awards.

 

This Plan’s effective date is the date the Plan is approved by the Company’s
shareholders (the “Effective Date”), and the Plan shall remain in effect as
provided in Section 1.3 hereof. Upon its effectiveness, the Plan shall supersede
the Existing Incentive Plan (as defined herein) such that no further Awards
shall be made under the Existing Incentive Plan. This Plan shall not, in any
way, affect awards under the Existing Incentive Plan that are outstanding as of
the Effective Date.

 

1.2         Purpose of this Plan. The purpose of the Plan is to (a) advance the
interests of the Company and its stockholders by providing incentives and
rewards to those individuals who are in a position to contribute to the long
term growth and profitability of the Company; (b) assist the Company and its
Subsidiaries and Affiliates in attracting, retaining, and developing highly
qualified Employees, Third Party Service Providers, and Nonemployee Directors
for the successful conduct of their business; and (c) make the Company's
compensation program competitive with those of other major employers.

 

1.3           Duration of this Plan. Unless sooner terminated as provided
herein, this Plan shall terminate ten (10) years from the Effective Date. After
this Plan is terminated, no Awards may be granted but Awards previously granted
shall remain outstanding in accordance with their applicable terms and
conditions and this Plan’s terms and conditions. Notwithstanding the foregoing,
no Incentive Stock Options may be granted more than ten (10) years after the
earlier of (a) adoption of this Plan by the Board, or (b) the Effective Date.

 

Article 2.Definitions

 

Whenever used in this Plan, the following terms shall have the meanings set
forth below, and when the meaning is intended, the initial letter of the word
shall be capitalized.

 

2.1“Affiliate” shall mean any corporation or other entity (including, but not
limited to, a partnership or a limited liability company), that is affiliated
with the Company through stock or equity ownership or otherwise, and is
designated as an Affiliate for purposes of this Plan by the Committee.

 

2.2“Annual Award Limit” or “Annual Award Limits” have the meaning set forth in
Section 4.1.

 

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2.3“Award” means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options, Incentive Stock Options, SARs, Restricted Stock,
Restricted Stock Units, Performance Shares, Performance Units, Cash-Based
Awards, or Other Stock-Based Awards, in each case subject to the terms of this
Plan.

 

2.4“Award Agreement” means either (i) a written agreement entered into by the
Company and a Participant setting forth the terms and provisions applicable to
an Award granted under this Plan, or (ii) a written or electronic statement
issued by the Company to a Participant describing the terms and provisions of
such Award, including any amendment or modification thereof. The Committee may
provide for the use of electronic, internet, or other non-paper Award
Agreements, and the use of electronic, internet, or other non-paper means for
the acceptance thereof and actions thereunder by a Participant.

 

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

 

2.6“Cash-Based Award” means an Award, denominated in cash, granted to a
Participant as described in Article 10.

 

2.7“Cause” means, unless otherwise specified in an Award Agreement or in an
applicable employment agreement between the Company (or its applicable
subsidiary or Affiliate) and a Participant, with respect to any Participant, as
determined by the Committee in its sole discretion, the Participant’s:

 

(a)Conviction of, or plea of nolo contendere to, a felony or other crime
involving moral turpitude;

 

(b)material breach of a material provision of a term of employment (or other
service provider function) that is not corrected within thirty (30) days
following written notice of such breach sent by the Company to the Participant;

 

(c)willful misconduct in the performance of material duties;

 

(d)performance of material duties that is grossly negligent; or

 

(e)failure to attempt to fully comply with any lawful directive of the Board
which is not corrected within thirty (30) days following written notice of such
breach sent by the Company to the Participant.

 

Whether or not “Cause” exists shall be determined solely by the Company in its
reasonable, good faith discretion.

 

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2.8“Change of Control” means the occurrence of any of the following events:

 

(a)Any one person, or more than one person acting as a group, acquires ownership
of stock (as determined under Code Section 318(a)) of the Company that, together
with stock held by such person or group, constitutes more than fifty percent
(50%) of the total fair market value or total voting power of the stock of the
Company; provided, however, that if any one person or more than one person
acting as a group, is considered to own more than fifty percent (50%) of the
total fair market value or total voting power of the stock of the Company, the
acquisition of additional stock by the same person or persons is not considered
to cause a Change in Control of the Company. This paragraph applies only when
there is a transfer of stock of the Company (or issuance of stock of the
Company) and stock in the Company remains outstanding after the transaction;

 

(b)any one person, or more than one person acting as a group, acquires (or has
acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) ownership of stock (as determined under
Code Section 318(a)) of the Company possessing thirty percent (30%) or more of
the total voting power of the stock of the Company; provided, however, that if
any one person or more than one person acting as a group, is considered to own
thirty percent (30%) or more of the total voting power of the stock of the
Company, the acquisition of additional stock by the same person or persons is
not considered to cause a Change in Control of the Company;

 

(c)the consummation of a Merger (as defined below), unless, following such
Merger, stock possessing at least fifty percent (50%) of the total combined
voting power of the issued and outstanding shares of all classes of Company
Voting Securities of the corporation resulting from such Merger is beneficially
owned, directly or indirectly, by individuals and entities who were beneficial
owners of the then-outstanding Company Voting Securities immediately prior to
such Merger in substantially the same proportion as their ownership immediately
prior to such Merger;

 

(d)individuals who are members of the Board as of the Effective Date of this
Plan (the “Incumbent Directors”) cease for any reason to constitute at least a
majority of the members of the Board; provided, however, that any individual
becoming a director subsequent to the date of this Plan whose appointment to the
Board or nomination for election by the Company was approved by a vote of at
least a majority of the Incumbent Directors then in office (unless such
appointment or election was at the request of an unrelated third party who has
taken steps reasonably calculated to result in a Change in Control as described
in paragraphs (a), (b) or (c) of this Section 2.8 and who has indicated publicly
an intent to seek control of the Company) shall be treated from the date of his
appointment or election as an Incumbent Director;

 

(e)consummation of a complete liquidation or dissolution of the Company; or

 

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(f)any one person, or more than one person acting as a group, acquires (or has
acquired during the 12-month period ending on the date of the most recent
acquisition by such person or persons) assets from the Company that have a total
gross fair market value equal to or more than forty percent (40%) of the total
gross fair market value of all of the assets of the Company immediately prior to
such acquisition(s); provided, however, that a transfer of assets by the Company
is not treated as a Change in Control if the assets are transferred to (A) a
shareholder of the Company (immediately before the asset transfer) in exchange
for or with respect to its stock; (B) an entity, fifty percent (50%) or more of
the total value or voting power of which is owned, directly or indirectly, by
the Company; (C) a person, or more than one person acting as a group, that owns,
directly or indirectly, fifty percent (50%) or more of the total value or voting
power of all outstanding stock of the Company; or (D) an entity, at least fifty
percent (50%) percent of the total value or voting power of which is owned,
directly or indirectly, by a person described in the previous subsection (C).
For purposes of this paragraph, (1) gross fair market value means the value of
the assets of the Company, or the value of the assets being disposed of,
determined without regard to any liabilities associated with such assets, and
(2) a person’s status is determined immediately after the transfer of the
assets.

 

For purposes of this Section 2.8, “Company Voting Securities” shall mean the
combined voting power of all outstanding classes of common stock of the Company
and all other outstanding securities of the Company entitled to vote generally
in the election of directors of the Company and “Merger” shall mean any merger,
reorganization, consolidation, share exchange, transfer of assets or other
transaction having similar effect involving the Company.

 

2.9“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to
time. For purposes of this Plan, references to sections of the Code shall be
deemed to include references to any applicable regulations thereunder and any
successor or similar provision.

 

2.10“Committee” means the Compensation Committee of the Board or such other
Committee appointed by the Board for the purpose of administering this Plan
comprised solely of two or more members of the Board who qualify as
“non-employee” directors within the meaning of Rule 16b-3 under the Exchange
Act, as “outside” directors within the meaning of § 162(m) of the Code, and as
“independent” directors within the meaning of NASDAQ Rule 4200(b)(15).

 

2.11“Company” or “Corporation” means Cinedigm Corp., a Delaware corporation, and
any successor thereto as provided in Article 20 herein.

 

2.12“Covered Employee” means any Employee who is a “covered employee,” as
defined in Code Section 162(m).

 

2.13“Effective Date” has the meaning set forth in Section 1.1.

 

2.14“Employee” means any individual performing services for the Company, an
Affiliate, or a Subsidiary and designated as an employee of the Company, its
Affiliates, and/or its Subsidiaries on the payroll records thereof. An Employee
shall not include any individual during any period he or she is classified or
treated by the Company, Affiliate, and/or Subsidiary as an independent
contractor, a consultant, or any employee of an employment, consulting, or
temporary agency or any other entity other than the Company, Affiliate, and/or
Subsidiary, without regard to whether such individual is subsequently determined
to have been, or is subsequently retroactively reclassified as a common-law
employee of the Company, Affiliate, and/or Subsidiary during such period.

 

2.15“Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time, or any successor act thereto.

 

2.16“Existing Incentive Plan” means the Second Amended and Restated 2000 Equity
Incentive Plan of Access Integrated Technologies, Inc., as previously amended,
restated, supplemented or otherwise modified prior to the Effective Date.

 

2.17“Full Value Award” means an Award other than in the form of an ISO, NQSO, or
SAR, and which is settled by the issuance of Shares.

 

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2.18“Good Reason” means, unless otherwise specified in an Award Agreement or in
an applicable employment agreement between the Company (or its applicable
Subsidiary or Affiliate) and a Participant, with respect to any Participant, as
determined by the Committee in its sole discretion without the Employee’s
written consent:

 

(a)a material and substantially adverse reduction in title or job
responsibilities compared with title or job responsibilities on the Effective
Date;

 

(b)the Company’s requiring the office nearest to the Employee’s principal
residence to be located at a place that is more than fifty (50) miles from where
such office is currently located; or

 

(c)any material breach of an employment agreement by the Company.

 

Notwithstanding the foregoing, Good Reason will be deemed to exist only in the
event that: (x) the Employee gives written notice to the Company of his or her
claim of Good Reason and the specific grounds for his claim within ninety (90)
days following the occurrence of the event upon which his claim rests, (y) the
Company fails to cure such breach within thirty days (30) of receiving such
notice (“Cure Period”), and (z) the Employee gives written notice to the Company
to terminate his employment within fifteen (15) days following the Cure Period.

 

2.19“Grant Date” means the date an Award is granted to a Participant pursuant to
the Plan.

 

2.20“Grant Price” means the price established at the time of grant of an SAR
pursuant to Article 7, used to determine whether there is any payment due upon
exercise of the SAR.

 

2.21“Incentive Stock Option” or “ISO” means an Option to purchase Shares granted
under Article 6 to an Employee and that is designated as an Incentive Stock
Option and that is intended to meet the requirements of Code Section 422, or any
successor provision.

 

2.22“Insider” shall mean an individual who is, on the relevant date, an officer,
or director of the Company, or a more than ten percent (10%) beneficial owner
(as that term is defined in Section 13d-3 of the Exchange Act) 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.

 

2.23“Market Price” means the closing price of the Class A Common Stock of the
Company as reported on the NASDAQ Global Market or such other primary market or
exchange on which the Class A Common Stock may, from time to time, trade (the
“Market”), on the date for which a Market Price is to be determined under this
Plan. To the extent an Option or SAR is granted on a date that the Market is
closed, the Market Price shall be the closing price on the last preceding
trading day.

 

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2.24“Nonemployee Director” means a member of the Company’s Board of Directors
who is not an Employee of the Company or its Affiliates or Subsidiaries.

 

2.25“Nonqualified Stock Option” or “NQSO” means an Option that is not intended
to meet the requirements of Code Section 422, or that otherwise does not meet
such requirements.

 

2.26“Option” means an Incentive Stock Option or a Nonqualified Stock Option, as
described in Article 6.

 

2.27“Option Price” means the price at which a Share may be purchased by a
Participant pursuant to an Option.

 

2.28“Other Stock-Based Award” means an equity-based or equity-related Award not
otherwise described by the terms of this Plan, granted pursuant to Article 10.

 

2.29“Participant” means any eligible individual as set forth in Article 5 to
whom an Award is granted.

 

2.30“Performance-Based Compensation” means compensation under an Award for which
(i) the Performance Measures for the Performance Period have been designated by
the Committee not later than the earlier of (a) ninety (90) days after the
beginning of the Performance Period, or (b) the date as of which twenty-five
percent (25%) of such period of time has elapsed, and (ii) the Award is
otherwise intended to satisfy the requirements of Code Section 162(m) for
certain performance-based compensation paid to Covered Employees.
Notwithstanding the foregoing, nothing in this Plan shall be construed to mean
that an Award which does not satisfy the requirements for performance-based
compensation under Code Section 162(m) does not constitute performance-based
compensation for other purposes, including Code Section 409A.

 

2.31“Performance Measures” means measures as described in Article 12 on which
the performance goals are based and which are approved by the Company’s
shareholders pursuant to this Plan in order to qualify Awards as
Performance-Based Compensation.

 

2.32“Performance Period” means the period of time during which the Performance
Measures must be met in order to determine the amount and/or vesting of an
Award.

 

2.33“Performance Share” means an Award under Article 9 herein and subject to the
terms of this Plan, denominated in Shares, the value of which at the time it is
payable is determined by the extent to which the applicable Performance Measures
have been achieved.

 

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2.34“Performance Unit” means an Award under Article 9 herein and subject to the
terms of this Plan, denominated in units, the value of which at the time it is
payable is determined as a function of the extent to which corresponding
Performance Measures have been achieved.

 

2.35“Period of Restriction” means the period when Restricted Stock or Restricted
Stock Units are subject to a substantial risk of forfeiture (based on the
passage of time, the achievement of Performance Measures or other performance
goals, or upon the occurrence of other events as determined by the Committee, in
its discretion), as provided in Article 8.

 

2.36“Plan” means this Cinedigm Corp. 2017 Incentive Plan.

 

2.37“Plan Year” means the twelve (12) month period beginning each April 1st.

 

2.38“Restricted Stock” means an Award granted to a Participant pursuant to
Article 8.

 

2.39“Restricted Stock Unit” means an Award granted to a Participant pursuant to
Article 8, except no Shares are actually awarded to the Participant on the Grant
Date.

 

2.40“Share” means a share of Class A Common Stock, $0.001 par value, of the
Company.

 

2.41“Stock Appreciation Right” or “SAR” means an Award, designated as an SAR,
pursuant to the terms of Article 7 herein.

 

2.42“Subsidiary” means any corporation or other entity, whether domestic or
foreign, in which the Company has or obtains, directly or indirectly, a
proprietary interest of more than fifty percent (50%) by reason of stock
ownership or otherwise.

 

2.43“Third Party Service Provider” means any consultant, agent, advisor, or
independent contractor who renders services to the Company, a Subsidiary, or an
Affiliate that (a) are not in connection with the offer and sale of Company’s
securities in a capital raising transaction, and (b) do not directly or
indirectly promote or maintain a market for the Company’s securities.

 

Article 3.Administration

 

3.1         General. The Committee shall be responsible for administering this
Plan, subject to this Article 3 and the other provisions of this Plan. The
Committee may employ attorneys, consultants, accountants, agents, and other
individuals, any of whom may be an Employee, and the Committee, the Company, and
its officers and directors shall be entitled to rely upon the advice, opinions,
or valuations of any such individuals. All actions taken and all interpretations
and determinations made by the Committee shall be final and binding upon the
Participants, the Company, and all other interested individuals.

 

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3.2         Authority of the Committee. The Committee shall have full and
exclusive discretionary power to interpret the terms and the intent of this Plan
and any Award Agreement or other agreement or document ancillary to or in
connection with this Plan, to determine eligibility for Awards and to adopt such
rules, regulations, forms, instruments, and guidelines for administering this
Plan as the Committee may deem necessary or proper. Such authority shall
include, but not be limited to, selecting Award recipients; determining the
types and amount of Awards to be granted to a recipient (including setting the
Option Price and Grant Price, so long as it is not lower than the applicable
Market Price or such other higher limit as required under applicable law);
establishing all Award terms and conditions, including the terms and conditions
set forth in Award Agreements; granting Awards as an alternative to or as the
form of payment for grants or rights earned or due under compensation plans or
arrangements of the Company; construing any ambiguous provision of the Plan or
any Award Agreement; establishing administrative regulations to further the
purpose of the Plan; and, subject to Article 19, adopting modifications and
amendments to this Plan or any Award Agreement, including without limitation,
any that are necessary to comply with the laws of the countries and other
jurisdictions in which the Company, its Affiliates, and/or its Subsidiaries
operate. The Committee also shall have the ability to delegate to the Chief
Executive Officer of the Company the right to allocate Awards among eligible
individuals who are not Insiders, provided that such delegation is subject to
such terms and conditions as the Committee in its discretion shall determine.

 

3.3         Delegation. The Committee may delegate to one or more of its members
or to one or more officers of the Company, and/or its Subsidiaries and
Affiliates or to one or more agents or advisors such administrative duties or
powers as it may deem advisable, and the Committee or any individuals to whom it
has delegated duties or powers as aforesaid may employ one or more individuals
to render advice with respect to any responsibility the Committee or such
individuals may have under this Plan.

 

Article 4.Shares Subject to this Plan and Maximum Awards

 

4.1         Number of Shares Available for Awards and Maximum Amount of
Non-Share Awards.

 

Subject to adjustment as provided in Section 4.3:

 

(a)The maximum number of Shares available for issuance to Participants under
this Plan, inclusive of Shares issued and Shares underlying outstanding awards
granted on or after the Effective Date, is 2,108,270 Shares, which includes
128,270 unused Shares carried over from the Existing Incentive Plan.

 

(b)The maximum number of Shares subject to Options or SARs granted in any one
(1) Plan Year to any one Participant shall be 400,000.

 

(c)The maximum number of Shares subject to all Full Value Awards granted in any
one (1) Plan Year to any one Participant shall be 400,000.

 

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(d)With respect to Awards granted under the Plan that are (i) intended to
satisfy the “performance-based” compensation exception contained in Code Section
162(m), and (ii) payable other than in Shares, the maximum amount payable to a
Participant in any year is $5,000,000.

 

(e)The maximum number of Shares that may be issued in the aggregate to all
Nonemployee Directors in any one (1) Plan Year shall be 300,000.

 

4.2         Share Usage. Shares covered by an Award shall only be counted as
used to the extent they are actually issued. With respect to Options and SARs,
the number of Shares available for Awards under the Plan pursuant to Section
4.1, shall be reduced by one Share for each Share covered by such Award or to
which such Award relates. The number of Shares available for Awards under the
Plan shall be reduced by one Share for each Share covered by such Award or to
which such Award relates. Awards that do not entitle the holder thereof to
receive or purchase Shares shall not be counted against the aggregate number of
Shares available for Awards under the Plan. In addition, any Shares related to
Awards which terminate by expiration, forfeiture, cancellation, or otherwise
without the issuance of such Shares shall be available again for grant under
this Plan. In no event, however, will the following Shares again become
available for Awards or increase the number of Shares available for grant under
the Plan: (i) Shares tendered by the Participant in payment of the exercise
price of an Option; (ii) Shares withheld from exercised Awards for tax
withholding purposes; (iii) Shares subject to a SAR that are not issued in
connection with the settlement of that SAR; and (iv) Shares repurchased by the
Company with proceeds received from the exercise of an Option. The Shares
available for issuance under this Plan shall be authorized and unissued Shares.

 

4.3         Adjustments in Authorized Shares. In the event of any corporate
event or transaction (including, but not limited to, a change in the Shares of
the Company or the capitalization of the Company) such as a merger,
consolidation, reorganization, recapitalization, separation, partial or complete
liquidation, stock dividend, stock split, reverse stock split, split up,
spin-off, or other distribution of stock or property of the Company, combination
of Shares, exchange of Shares, dividend in kind, or other like change in capital
structure, number of outstanding Shares or distribution (other than normal cash
dividends) to shareholders of the Company, or any similar corporate event or
transaction, the Committee, in its sole discretion, in order to prevent dilution
or enlargement of Participants’ rights under this Plan, shall substitute or
adjust, as applicable, the number and kind of Shares that may be issued under
this Plan or under particular forms of Awards, the number and kind of Shares
subject to outstanding Awards, the Option Price or Grant Price applicable to
outstanding Awards, the Annual Award Limits, and other value determinations
applicable to outstanding Awards.

 

The Committee, in its sole discretion, may also make appropriate adjustments in
the terms of any Awards under this Plan to reflect or relate to such changes or
distributions and to modify any other terms of outstanding Awards, including
modifications of Performance Measures and changes in the length of Performance
Periods. The determination of the Committee as to the foregoing adjustments, if
any, shall be conclusive and binding on Participants under this Plan.

 

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Subject to the provisions of Article 19 and notwithstanding anything else herein
to the contrary, without affecting the number of Shares reserved or available
hereunder, the Committee may authorize the issuance or assumption of benefits
under this Plan in connection with any merger, consolidation, acquisition of
property or stock, or reorganization upon such terms and conditions as it may
deem appropriate (including, but not limited to, a conversion of equity awards
into Awards under this Plan in a manner consistent with paragraph 53 of FASB
Interpretation No. 44), subject to compliance with the rules under Code Sections
422 and 424, as and where applicable.

 

Article 5.Eligibility and Participation

 

5.1         Eligibility. Individuals eligible to participate in this Plan
include all Employees, Nonemployee Directors, and Third Party Service Providers.

 

5.2         Actual Participation. Subject to the provisions of this Plan, the
Committee may, from time to time, select from all eligible individuals those
individuals to whom Awards shall be granted and shall determine, in its sole
discretion, the nature of any and all terms permissible by law, and the amount
of each Award.

 

Article 6.Stock Options

 

6.1         Grant of Options. Subject to the terms and provisions of this Plan,
Options may be granted to Participants in such number, and upon such terms, and
at any time and from time to time as shall be determined by the Committee, in
its sole discretion.

 

6.2         Award Agreement. Each Option grant shall be evidenced by an Award
Agreement that shall specify the Option Price, the maximum duration of the
Option, the number of Shares to which the Option pertains, the conditions upon
which an Option shall become vested and exercisable, and such other provisions
as the Committee shall determine which are not inconsistent with the terms of
this Plan. The Award Agreement also shall specify whether the Option is intended
to be an ISO or a NQSO.

 

6.3         Option Price. The Option Price for each grant of an Option under
this Plan shall be determined by the Committee in its sole discretion and shall
be specified in the Award Agreement; provided, however, the Option Price must be
at least equal to one hundred percent (100%) of the Market Price of the Shares
as determined on the Grant Date. If the Participant to whom an ISO is granted
owns, at the time of the grant, more than ten percent (10%) of the combined
voting power of the Company, or its Subsidiaries or Affiliates, the exercise
price of each Share subject to such Option shall be not less than one hundred
ten percent (110%) of the closing price described in the preceding sentence.

 

6.4         Term of Options. Each Option granted to a Participant shall expire
at such time as the Committee shall determine at the time of grant; provided,
however, no Option shall be exercisable later than the day before the tenth
(10th) anniversary date of its Grant Date (or in the case of an ISO granted to a
Participant who at the time of grant owns stock representing more than ten
percent (10%) of the combined voting power of the Company, or its Subsidiaries
or Affiliates, no later than the day before the fifth (5th) anniversary date of
its Grant Date). Notwithstanding the foregoing, for Nonqualified Stock Options
granted to Participants outside the United States, the Committee has the
authority to grant Nonqualified Stock Options that have a term greater than ten
(10) years.

 

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6.5         Exercise of Options. Subject to Section 6.8, Options granted under
this Article 6 shall be exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in each instance approve,
which terms and restrictions need not be the same for each grant or for each
Participant.

 

6.6         Payment. Options granted under this Article 6 shall be exercised by
the delivery of a notice of exercise to the Company or an agent designated by
the Company in a form specified or accepted by the Committee, or by complying
with any alternative procedures which may be authorized by the Committee,
setting forth the number of Shares with respect to which the Option is to be
exercised, accompanied by full payment for the Shares.

 

A condition of the issuance of the Shares as to which an Option shall be
exercised shall be the payment of the Option Price. The Option Price of any
Option shall be payable to the Company in full either: (a) in cash or its
equivalent; (b) by tendering (either by actual delivery or attestation)
previously acquired Shares having an aggregate Market Price at the time of
exercise equal to the Option Price (provided that except as otherwise determined
by the Committee, the Shares that are tendered must have been held by the
Participant for at least six (6) months (or such other period, if any, as the
Committee may permit) prior to their tender to satisfy the Option Price if
acquired under this Plan or any other compensation plan maintained by the
Company or have been purchased on the open market); (c) by a cashless
(broker-assisted) exercise; (d) by the Company withholding Shares that otherwise
would be delivered to the exerciser pursuant to the exercise of the Option in an
amount equaling the value of the exercise price; (e) by a combination of (a),
(b), (c) and/or (d); or (f) any other method approved or accepted by the
Committee in its sole discretion.

 

Subject to any governing rules or regulations, as soon as practicable after
receipt of written notification of exercise and full payment (including
satisfaction of any applicable tax withholding), the Company shall deliver to
the Participant evidence of book entry Shares, or upon the Participant’s
request, Share certificates in an appropriate amount based upon the number of
Shares purchased under the Option(s).

 

Unless otherwise determined by the Committee, all payments under all of the
methods indicated above shall be paid in United States dollars.

 

6.7         Restrictions on Share Transferability. The Committee may impose such
restrictions on any Shares acquired pursuant to the exercise of an Option
granted under this Article 6 as it may deem advisable, including, without
limitation, minimum holding period requirements, or restrictions under
applicable federal securities laws, requirements of any stock exchange or market
upon which such Shares are then listed and/or traded, or any blue sky or state
securities laws applicable to such Shares.

 

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6.8         Termination of Employment. Each Participant’s Award Agreement shall
set forth the extent to which the Participant shall have the right to exercise
the Option following termination of the Participant’s employment or provision of
services to the Company, its Affiliates, and/or its Subsidiaries, as the case
may be. Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into with each
Participant, need not be uniform among all Options issued pursuant to this
Article 6, and may reflect distinctions based on the reasons for termination.
Unless otherwise provided in an Award Agreement, the right to exercise an Option
shall terminate on the date the Participant’s employment, or service on the
Board or to the Company, terminates.

 

6.9         Notification of Disqualifying Disposition. If any Participant shall
make any disposition of Shares issued pursuant to the exercise of an ISO under
the circumstances described in Code Section 421(b) (relating to certain
disqualifying dispositions), such Participant shall notify the Company of such
disposition within ten (10) days thereof.

 

6.10       Limits on Incentive Stock Options. The aggregate fair market value of
all Shares with respect to which ISOs are exercisable for the first time by a
Participant in any one calendar year, under this Plan or any other stock option
plan maintained by the Company (or by any subsidiary or parent of the Company),
shall not exceed $100,000. The fair market value of such Shares shall be the
mean closing price of the Shares as reported on the Market on the date the
related ISO is granted.

 

Article 7.Stock Appreciation Rights

 

7.1         Grant of SARs. Subject to the terms and conditions of this Plan,
SARs may be granted to Participants at any time and from time to time as shall
be determined by the Committee. Subject to the terms and conditions of this
Plan, the Committee shall have complete discretion in determining the number of
SARs granted to each Participant and, consistent with the provisions of this
Plan, in determining the terms and conditions pertaining to such SARs. The Grant
Price for each grant of an SAR shall be determined by the Committee and shall be
specified in the Award Agreement; provided, however, the Grant Price on the
Grant Date must be at least equal to one hundred percent (100%) of the Market
Price of the Shares as determined on the Grant Date.

 

7.2         SAR Agreement. Each SAR Award shall be evidenced by an Award
Agreement that shall specify the Grant Price, the term of the SAR, and such
other provisions as the Committee shall determine.

 

7.3         Term of SAR. The term of an SAR granted under this Plan shall be
determined by the Committee, in its sole discretion, and except as determined
otherwise by the Committee and specified in the SAR Award Agreement, no SAR
shall be exercisable later than the tenth (10th) anniversary date of its grant.
Notwithstanding the foregoing, for SARs granted to Participants outside the
United States, the Committee has the authority to grant SARs that have a term
greater than ten (10) years.

 

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7.4         Exercise of SARs. SARs may be exercised upon whatever terms and
conditions the Committee, in its sole discretion, imposes.

 

7.5         Settlement of SARs. Upon the exercise of an SAR, a Participant shall
be entitled to receive payment from the Company in an amount determined by
multiplying:

 

(a)The excess of the Market Price of a Share on the date of exercise over the
Grant Price; by

 

(b)The number of Shares with respect to which the SAR is exercised.

 

At the discretion of the Committee, the payment upon SAR exercise may be in
cash, Shares, or any combination thereof, or in any other manner approved by the
Committee in its sole discretion. The Committee’s determination regarding the
form of SAR payout shall be set forth in the Award Agreement pertaining to the
grant of the SAR.

 

7.6         Termination of Employment. Each Award Agreement shall set forth the
extent to which the Participant shall have the right to exercise the SAR
following termination of the Participant’s employment with or provision of
services to the Company, its Affiliates, and/or its Subsidiaries, as the case
may be. Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into with
Participants, need not be uniform among all SARs issued pursuant to this Plan,
and may reflect distinctions based on the reasons for termination. Unless
otherwise provided in an Award Agreement, the right to exercise the SAR shall
terminate on the date the Participant’s employment, or service on the Board or
to the Company, terminates.

 

7.7         Other Restrictions. The Committee shall impose such other conditions
and/or restrictions on any Shares received upon exercise of an SAR granted
pursuant to this Plan as it may deem advisable or desirable. These restrictions
may include, but shall not be limited to, a requirement that the Participant
hold the Shares received upon exercise of an SAR for a specified period of time.

 

Article 8.Restricted Stock and Restricted Stock Units

 

8.1         Grant of Restricted Stock or Restricted Stock Units. Subject to the
terms and provisions of this Plan, the Committee, at any time and from time to
time, may grant Shares of Restricted Stock and/or Restricted Stock Units to
Participants in such amounts as the Committee shall determine. Restricted Stock
Units shall be similar to Restricted Stock except that no Shares are actually
awarded to the Participant on the Grant Date.

 

8.2         Restricted Stock or Restricted Stock Unit Agreement. Each Restricted
Stock and/or Restricted Stock Unit grant shall be evidenced by an Award
Agreement that shall specify the Period(s) of Restriction, the number of Shares
of Restricted Stock or the number of Restricted Stock Units granted, and such
other provisions as the Committee shall determine.

 

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8.3         Other Restrictions. The Committee shall impose such other conditions
and/or restrictions on any Shares of Restricted Stock or Restricted Stock Units
granted pursuant to this Plan as it may deem advisable including, without
limitation, restrictions based upon the achievement of specific Performance
Measures or other performance goals, time-based restrictions on vesting
following the attainment of the Performance Measures or other performance goals,
time-based restrictions, and/or restrictions under applicable laws or under the
requirements of any stock exchange or market upon which such Shares are listed
or traded, or holding requirements or sale restrictions placed on the Shares by
the Company upon vesting of such Restricted Stock or Restricted Stock Units.

 

To the extent deemed appropriate by the Committee, the Company may retain the
certificates representing Shares of Restricted Stock in the Company’s possession
until such time as all conditions and/or restrictions applicable to such Shares
have been satisfied or lapse.

 

Except as otherwise provided in this Article 8, Shares of Restricted Stock
covered by each Restricted Stock Award shall become freely transferable by the
Participant after all conditions and restrictions applicable to such Shares have
been satisfied or lapse (including satisfaction of any applicable tax
withholding obligations), and Restricted Stock Units shall be paid in cash,
Shares, or a combination of cash and Shares as the Committee, in its sole
discretion shall determine.

 

8.4         Certificate Legend. In addition to any legends placed on
certificates pursuant to Section 8.3, each certificate representing Shares of
Restricted Stock granted pursuant to this Plan may bear a legend such as the
following or as otherwise determined by the Committee in its sole discretion:

 

The sale or transfer of Shares of stock represented by this certificate, whether
voluntary, involuntary, or by operation of law, is subject to certain
restrictions on transfer as set forth in the Cinedigm Corp. 2017 Incentive Plan,
and in the associated Award Agreement. A copy of this Plan and such Award
Agreement may be obtained from Cinedigm Corp..

 

8.5         Voting Rights. Unless otherwise determined by the Committee and set
forth in a Participant’s Award Agreement, to the extent permitted or required by
law, as determined by the Committee, Participants holding Shares of Restricted
Stock granted hereunder may be granted the right to exercise full voting rights
with respect to those Shares during the Period of Restriction. A Participant
shall have no voting rights with respect to any Restricted Stock Units granted
hereunder.

 

8.6         Termination of Employment. Each Award Agreement shall set forth the
extent to which the Participant shall have the right to retain Restricted Stock
and/or Restricted Stock Units following termination of the Participant’s
employment with or provision of services to the Company, its Affiliates, and/or
its Subsidiaries, as the case may be. Such provisions shall be determined in the
sole discretion of the Committee, shall be included in the Award Agreement
entered into with each Participant, need not be uniform among all Shares of
Restricted Stock or Restricted Stock Units issued pursuant to this Plan, and may
reflect distinctions based on the reasons for termination.

 

 14 

 

 

8.7         Section 83(b) Election. The Committee may provide in an Award
Agreement that the Award of Restricted Stock is conditioned upon the Participant
making or refraining from making an election with respect to the Award under
Code Section 83(b). If a Participant makes an election pursuant to Code Section
83(b) concerning a Restricted Stock Award, the Participant shall be required to
file promptly a copy of such election with the Company.

 

Article 9.Performance Units/Performance Shares

 

9.1         Grant of Performance Units/Performance Shares. Subject to the terms
and provisions of this Plan, the Committee, at any time and from time to time,
may grant Performance Units and/or Performance Shares to Participants in such
amounts and upon such terms as the Committee shall determine. Performance Units
and Performance Shares that are earned (as described in Section 9.3) may be
subject to vesting requirements as set forth in the applicable Award Agreement.
Except as the Committee may otherwise provide in an Award Agreement, Performance
Units and Performance Shares may not vest prior to the expiration of at least
one (1) year of a Performance Period.

 

9.2         Value of Performance Units/Performance Shares. Each Performance Unit
shall have an initial value that is established by the Committee at the time of
grant. Each Performance Share shall have an initial value equal to the Marker
Price of a Share on the Grant Date. The Committee shall set Performance Measures
in its discretion which, depending on the extent to which they are met, will
determine the value and/or number of Performance Units/Performance Shares that
may be earned by the Participant.

 

9.3         Earning of Performance Units/Performance Shares. Subject to the
terms of this Plan, after the applicable Performance Period and vesting period,
if any, have ended, the holder of Performance Units/Performance Shares shall be
entitled to receive payout on the value and number of Performance
Units/Performance Shares earned by the Participant over the Performance Period,
to be determined as a function of the extent to which the corresponding
Performance Measures have been achieved.

 

9.4         Form and Timing of Payment of Performance Units/Performance Shares.
Payment of earned and vested Performance Units/Performance Shares shall be as
determined by the Committee and as evidenced in the Award Agreement. Subject
to the terms of this Plan, the Committee, in its sole discretion, may pay
earned and vested Performance Units/Performance Shares in the form of cash or in
Shares (or in a combination thereof). Any Shares may be granted subject to any
restrictions deemed appropriate by the Committee. The determination of the
Committee with respect to the form of payout of such Awards shall be set forth
in the Award Agreement pertaining to the grant of the Award.

 

9.5          Termination of Employment. Each Award Agreement shall set forth the
extent to which the Participant shall have the right to retain Performance Units
and/or Performance Shares following termination of the Participant’s employment
with the Company, its Affiliates, and/or its Subsidiaries, as the case may be.
Such provisions shall be determined in the sole discretion of the Committee,
shall be included in the Award Agreement entered into with each Participant,
need not be uniform among all Awards of Performance Units or Performance Shares
issued pursuant to this Plan, and may reflect distinctions based on the reasons
for termination.

 

 15 

 

 

Article 10.Cash-Based Awards and Other Stock-Based Awards

 

10.1       Grant of Cash-Based Awards. Subject to the terms and provisions of
the Plan, the Committee, at any time and from time to time, may grant Cash-Based
Awards to Participants in such amounts and upon such terms as the Committee may
determine.

 

10.2       Other Stock-Based Awards. The Committee may grant other types of
equity-based or equity-related Awards not otherwise described by the terms of
this Plan (including the grant or offer for sale of unrestricted Shares) in such
amounts and subject to such terms and conditions, as the Committee shall
determine. Such Awards may involve the transfer of actual Shares to
Participants, or payment in cash or otherwise of amounts based on the value of
Shares and may include, without limitation, Awards designed to comply with or
take advantage of the applicable local laws of jurisdictions other than the
United States.

 

10.3       Value of Cash-Based and Other Stock-Based Awards. Each Cash-Based
Award shall specify a payment amount or payment range as determined by the
Committee. Each Other Stock-Based Award shall be expressed in terms of Shares or
units based on Shares, as determined by the Committee. The Committee may
establish performance goals in its discretion. If the Committee exercises its
discretion to establish performance goals, the number and/or value of Cash-Based
Awards or Other Stock-Based Awards that will be paid out to the Participant will
depend on the extent to which the performance goals are met.

 

10.4       Payment of Cash-Based Awards and Other Stock-Based Awards. Payment,
if any, with respect to a Cash-Based Award or an Other Stock-Based Award shall
be made in accordance with the terms of the Award, in cash or Shares as the
Committee determines.

 

10.5       Termination of Employment. The Committee shall determine the extent
to which the Participant shall have the right to receive Cash-Based Awards or
Other Stock-Based Awards following termination of the Participant’s employment
with or provision of services to the Company, its Affiliates, and/or its
Subsidiaries, as the case may be. Such provisions shall be determined in the
sole discretion of the Committee, such provisions shall be included in the Award
Agreement entered into with each Participant, but need not be uniform among all
Awards of Cash-Based Awards or Other Stock-Based Awards issued pursuant to the
Plan, and may reflect distinctions based on the reasons for termination.

 

Article 11.Transferability of Awards

 

11.1       Transferability. Except as provided in Section 11.2 below, during a
Participant’s lifetime, his or her Awards shall be exercisable only by the
Participant (except Options and SARs may be exercised by the Participant’s duly
appointed personal representative). Awards shall not be transferable other than
by will or the laws of descent and distribution; no Awards shall be subject, in
whole or in part, to attachment, execution, or levy of any kind; and any
purported transfer in violation hereof shall be null and void. The Committee may
establish such procedures as it deems appropriate for a Participant to designate
a beneficiary to whom any amounts payable or Shares deliverable in the event of,
or following, the Participant’s death, may be provided.

 

 16 

 

 

11.2      Committee Action. The Committee may, in its discretion, determine that
notwithstanding Section 11.1, any or all Awards (other than ISOs) shall be
transferable to and exercisable by such transferees, and subject to such terms
and conditions, as the Committee may deem appropriate; provided, however, no
Award may be transferred for value (as defined in the General Instructions to
Form S-8).

 

Article 12.Performance Measures

 

12.1      Performance Measures. The Performance Measures upon which the payment
or vesting of an Award to a Covered Employee that is intended to qualify as
Performance-Based Compensation shall be limited to the following:

 

(a)Net earnings or Net Income (before or after taxes);

 

(b)Earnings per share (basic or diluted);

 

(c)Net sales or revenue growth;

 

(d)Net operating profit;

 

(e)Return measures (including, but not limited to, return on assets, capital,
invested capital, equity, sales, or revenue);

 

(f)Cash flow (including, but not limited to, throughput, operating cash flow,
free cash flow, cash flow return on equity, and cash flow return on investment);

 

(g)Earnings before or after taxes, interest, depreciation, and/or amortization;

 

(h)Earnings before taxes;

 

(i)Gross or operating margins;

 

(j)Corporate value measures;

 

(k)Capital expenditures;

 

(l)Unit volumes;

 

(m)Productivity ratios;

 

(n)Share price (including, but not limited to, growth measures and total
shareholder return);

 

(o)Cost or expense;

 

 17 

 

 

(p)Margins (including, but not limited to, debt or profit);

 

(q)Operating efficiency;

 

(r)Market share;

 

(s)Customer satisfaction;

 

(t)Working capital targets or any element thereof;

 

(u)Economic value added or EVA® (net operating profit after tax minus the sum of
capital multiplied by the cost of capital);

 

(v)Health, safety and environmental performance;

 

(w)Corporate advocacy metrics;

 

(x)Strategic milestones (including, but not limited to, debt reduction,
improvement of cost of debt, equity or capital, completion of projects,
achievement of synergies or integration objectives, or improvements to credit
rating, inventory turnover, weighted average cost of capital, implementation of
significant new processes, productivity or production, product quality, and any
combination of the foregoing);

 

(y)Strategic sustainability metrics (including, but not limited to, corporate
governance, enterprise risk management, employee development, and portfolio
restructuring); and

 

(z)Stockholder equity or net worth.

 

Any one or more Performance Measure(s) may be used to measure the performance of
any Participant, the Company, Subsidiary, and/or Affiliate as a whole or any
business unit or line of business of the Company, Subsidiary, and/or Affiliate
or any combination thereof, as the Committee may deem appropriate, or any of the
above Performance Measures on an absolute, gross, total, net per share, average,
adjusted or relative basis (or measure based on changes therein), including, as
compared to the performance of a group of comparator companies, or published or
special index that the Committee, in its sole discretion, deems appropriate, or
the Company may select Performance Measure (n) above as compared to various
stock market indices. The Committee also has the authority to provide for
accelerated vesting of any Award based on the achievement of performance goals
pursuant to the Performance Measures specified in this Article 12.

 

 18 

 

 

12.2       Evaluation of Performance. The Committee may provide in any such
Award that any evaluation of performance may include or exclude any of the
following events that occurs during a Performance Period: (a) asset write-downs,
(b) litigation or claim judgments or settlements, (c) the effect of changes in
tax laws, accounting principles, or other laws or provisions affecting reported
results, (d) any reorganization and restructuring programs, (e) unusual and/or
nonrecurring items as described in management’s discussion and analysis of
financial condition and results of operations appearing in the Company’s annual
report to shareholders for the applicable year, (f) acquisitions or
divestitures, and (g) foreign exchange gains and losses. To the extent such
inclusions or exclusions affect Awards to Covered Employees, they shall be
prescribed in a form that meets the requirements of Code Section 162(m) for
deductibility.

 

12.3       Adjustment of Performance-Based Compensation. The Committee shall not
use discretion to adjust the payout of Performance-Based Compensation upwards
once the Performance Measures have been established. The Committee shall retain
the discretion to adjust such Awards downward, either on a formula or
discretionary basis or any combination, as the Committee determines.

 

12.4       Committee Discretion. In the event that applicable tax and/or
securities laws change to permit Committee discretion to alter the governing
Performance Measures without obtaining shareholder approval of such changes, the
Committee shall have sole discretion to make such changes without obtaining
shareholder approval. In addition, in the event that the Committee determines
that it is advisable to grant Awards that are not Performance-Based
Compensation, the Committee may make such grants without satisfying the
requirements of Code Section 162(m) and base vesting on Performance Measures
other than those set forth in Section 12.1.

 

Article 13.Nonemployee Director Awards

 

The Board or Committee shall determine all Nonemployee Director Awards. The
terms and conditions of any grant to any such Nonemployee Director shall be set
forth in an Award Agreement.

 

Article 14.Minimum Vesting of Share-Based Awards

 

Notwithstanding any other provision of this Plan to the contrary, Awards granted
pursuant to Article 6, 7 and 8 of this Plan shall be subject to a minimum
vesting period of at least one (1) year, provided, however, (a) such vesting may
be cliff or graded (starting no earlier than one (1) year after grant), (b) the
Committee may provide for earlier vesting as specified in an Award Agreement,
and (c) no more than five percent (5%) of the maximum number of Shares
authorized for issuance under this Plan pursuant to Section 4.1(a) may be
granted with a minimum vesting period of less than one (1) year.

 

Article 15.Dividend Equivalents

 

Any Participant selected by the Committee may be granted dividend equivalents
based on the dividends declared on Shares that are subject to any Award, to be
credited as of dividend payment dates, during the period between the date the
Award is granted and the date the Award is exercised, vests or expires, as
determined by the Committee. Such dividend equivalents shall be converted to
cash or additional Shares by such formula and at such time and subject to such
limitations as may be determined by the Committee. Notwithstanding the
foregoing, for all Awards, the payment of dividends prior to an Award becoming
vested shall be prohibited, and the Committee shall determine the extent to
which dividends may accrue during the vesting period and become payable upon
vesting. Dividends and dividend equivalents may not be paid on unexercised
Options and SARs.

 

 19 

 

 

Article 16.Beneficiary Designation

 

Each Participant under this Plan may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under this Plan is to be paid in case of his death before he receives
any or all of such benefit. Each such designation shall revoke all prior
designations by the same Participant, shall be in a form prescribed by the
Committee, and will be effective only when filed by the Participant in writing
with the Company, or the Company’s designated agent, during the Participant’s
lifetime. In the absence of any such beneficiary designation, benefits remaining
unpaid or rights remaining unexercised at the Participant’s death shall be paid
to or exercised by the Participant’s executor, administrator, or legal
representative.

 

Article 17.Rights of Participants

 

17.1       Employment. Nothing in this Plan or an Award Agreement shall
interfere with or limit in any way the right of the Company, its Affiliates,
and/or its Subsidiaries, to terminate any Participant’s employment, or service
on the Board or to the Company, at any time or for any reason not prohibited by
law, nor confer upon any Participant any right to continue his employment, or
service as a Nonemployee Director or Third Party Service Provider, for any
specified period of time.

 

Neither an Award nor any benefits arising under this Plan shall constitute an
employment contract with the Company, its Affiliates, and/or its Subsidiaries
and, accordingly, subject to Articles 3 and 19, this Plan and the benefits
hereunder may be terminated at any time in the sole and exclusive discretion of
the Committee without giving rise to any liability on the part of the Company,
its Affiliates, and/or its Subsidiaries.

 

17.2       Participation. No individual shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected to
receive a future Award.

 

17.3       Rights as a Shareholder. Except as otherwise provided herein, a
Participant shall have none of the rights of a shareholder with respect to
Shares covered by any Award until the Participant becomes the record holder of
such Shares.

 

Article 18.Change of Control

 

18.1       Change of Control of the Company. Notwithstanding any other provision
of this Plan to the contrary, the provisions of this Article 18 shall apply in
the event of a Change of Control, unless otherwise determined by the Committee
in connection with the grant of an Award as reflected in the applicable Award
Agreement or severance compensation agreement.

 

 20 

 

 

(a)            If, upon a Change of Control, a Participant receives a new Award
which qualifies as a “Replacement Award” (as defined below), the Replacement
Award shall continue subject to the terms of the Replacement Award.

 

(b)            If, upon a Change of Control that results in the Company’s Shares
no longer being traded on the NASDAQ Global Market or another established
securities market and no Replacement Award is granted to a Participant, the
unvested portion of an Award whose vesting is based only on a service
requirement shall become immediately vested and exercisable, as applicable, upon
the Change of Control.

 

(c)            Notwithstanding subparagraph (a) and except as may be otherwise
provided in an Award Agreement, upon a Change of Control, with respect to Awards
that are Performance Shares or Performance Units issued pursuant to Article 9 of
the Plan, a pro-rata portion of the Award shall be immediately earned, vested
and payable; such portion shall be determined based on the portion of the
Performance Period that has elapsed as of (i) the date of the Change of Control,
if the Performance Measure is based on stock price, or (ii) the end of the last
full calendar quarter preceding or commensurate with the date of the Change of
Control if the Performance Measure is not based on stock price (in each case,
the “Adjusted Measurement Date”). The Award amount that will be considered
earned and payable will be calculated based on the higher of target or actual
performance measured as of the Adjusted Measurement Date. To the extent any
earned Awards that are Performance Shares or Performance Units have not been
paid prior to the Change of Control because they are subject to vesting, such
earned but unvested Awards shall become immediately vested, and payable upon the
Change of Control.

 

(d)            Except as provided in subparagraph (c) or as otherwise provided
in an Award Agreement, if, following a Change of Control, the Company’s Shares
continue to be traded on the NASDAQ Global Market or another established
securities market, outstanding Awards shall continue in effect and be treated as
Replacement Awards as described in subparagraph (a).

 

(e)            Notwithstanding any of subparagraphs (a), (b) or (d) of this
Section 18.1, the Committee may, in its sole discretion, determine that any or
all outstanding Awards granted under the Plan, whether or not exercisable, will
be canceled and terminated, and that in connection with such cancellation and
termination, the holder of such Award may receive for each Share subject to such
Awards a cash payment (or the delivery of shares of stock, other securities or a
combination of cash, stock and securities equivalent to such cash payment) equal
to the difference, if any, between the consideration received by shareholders of
the Company in respect of a Share in connection with such transaction and the
purchase price per share, if any, under the Award multiplied by the number of
Shares subject to such Award; provided that if such product is zero or less or
to the extent that the Award is not then exercisable, the Awards will be
canceled and terminated without payment therefor.

 

 21 

 

 

18.2       Replacement Awards. An Award shall be considered a Replacement Award
if: (i) it has a value at least equal to the value of the Award it is replacing
as determined by the Committee in its sole discretion; (ii) it relates to
publicly traded equity securities of the Company or its successor in the Change
of Control or another entity that is affiliated with the Company or its
successor following the Change of Control; and (iii) its other terms and
conditions are not less favorable to the Participant than the terms and
conditions of the Award it is replacing (including the provisions that would
apply in the event of a subsequent Change of Control). Without limiting the
generality of the foregoing, the Replacement Award may take the form of a
continuation of the Award it is replacing if the requirements of the preceding
sentence are satisfied. The determination of whether the conditions of this
Section 18.2 are satisfied shall be made by the Committee, as constituted
immediately before the Change of Control, in its sole discretion.

 

18.3       Reduction of Excess Parachute Payments. Except as may be provided in
a severance compensation agreement between the Company and the Participant, if,
in connection with a Change of Control, a Participant’s Award will cause the
Participant to be liable for federal excise tax under Code Section 4999 levied
on certain “excess parachute payments” as defined in Code Section 280G (“Excise
Tax”), then the payments made pursuant to the Awards shall be reduced (or repaid
to the Company, if previously paid or provided) as provided below:

 

(a)          If the payments due upon a Change of Control under this Plan and
any other agreement between a Participant and the Company, exceed 2.99 times the
Participant’s “base amount,” as defined in Code Section 280G, and it is
determined that any Excise Tax is payable by a Participant, the Participant
shall receive either (i) all payments otherwise due; or (ii) the reduced payment
amount described in the next sentence, whichever will provide the Participant
with the greater after-tax economic benefit taking into account for these
purposes any applicable Excise Tax. To the extent necessary, and in compliance
with the Code, a reduced payment amount shall be calculated by reducing the
payments to the minimum extent necessary so that no portion of any payment, as
so reduced or repaid, constitutes an excess parachute payment. .

 

(b)          Whether payments are to be reduced pursuant to this Section 18.3,
and the extent to which they are to be so reduced, will be determined solely by
the Company in good faith and the Company will notify the Participant in writing
of its determination.

 

(c)          In no event shall a Participant be entitled to receive any kind of
gross-up payment or Excise Tax reimbursement from the Company.

 

Article 19.Amendment, Modification, Suspension, and Termination

 

19.1       Amendment, Modification, Suspension, and Termination. Subject to
Section 19.3, the Committee may, at any time and from time to time, alter,
amend, modify, suspend, or terminate this Plan and any Award Agreement in whole
or in part; provided, however, that, (i) without the prior approval of the
Company’s shareholders and except as provided in Section 4.3, Options or SARs
issued under this Plan will not be repriced, repurchased (including a cash
buyout), replaced, or regranted through cancellation, or by lowering the Option
Price of a previously granted Option or the Grant Price of a previously granted
SAR, (ii) any amendment of the Plan must comply with the rules of the Market,
and (iii) no material amendment of this Plan shall be made without shareholder
approval if shareholder approval is required by law, regulation, or stock
exchange rule.

 

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19.2      Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. Subject to the requirements of Sections 12.2 and 12.3, the
Committee may make adjustments in the terms and conditions of, and the criteria
included in, Awards in recognition of unusual or nonrecurring events (including,
without limitation, the events described in Section 4.3 hereof) affecting the
Company or the financial statements of the Company or of changes in applicable
laws, regulations, or accounting principles, whenever the Committee determines
that such adjustments are appropriate in order to prevent unintended dilution or
enlargement of the benefits or potential benefits intended to be made available
under this Plan. The determination of the Committee as to the foregoing
adjustments, if any, shall be conclusive and binding on Participants under this
Plan.

 

19.3      Awards Previously Granted. Notwithstanding any other provision of this
Plan to the contrary (other than Section 19.4), no termination, amendment,
suspension, or modification of this Plan or an Award Agreement shall adversely
affect in any material way any Award previously granted under this Plan, without
the written consent of the Participant holding such Award.

 

19.4      Amendment to Conform to Law. Notwithstanding any other provision of
this Plan to the contrary, the Committee may amend the Plan or an Award
Agreement, to take effect retroactively or otherwise, as deemed necessary or
advisable for the purpose of conforming the Plan or an Award Agreement to any
present or future law relating to plans of this or similar nature (including,
but not limited to, Code Section 409A), and to the administrative regulations
and rulings promulgated thereunder. By accepting an Award under this Plan, a
Participant agrees to any amendment made pursuant to this Section 19.4 to any
Award granted under the Plan without further consideration or action.

 

19.5      Compliance with the Exchange Act. It is the Company's intent that the
Plan comply in all respects with Rule 16b-3 under the Exchange Act and any
related regulations. If any provision of this Plan is later found not to be in
compliance with such Rule and regulations, the provisions shall be deemed null
and void. All grants to, and exercises of Options by Insiders under this Plan
shall be executed in accordance with the requirements of Section 16 of the
Exchange Act and regulations promulgated thereunder.

 

Article 20.Withholding

 

20.1      Tax Withholding. The Company shall have the power and the right to
deduct or withhold from any amounts due and owing to the Participant, or require
a Participant to remit to the Company, up to the maximum statutory amount to
satisfy federal, state, and local taxes, domestic or foreign, required by law or
regulation to be withheld with respect to any taxable event arising as a result
of this Plan.

 

20.2      Share Withholding. With respect to withholding required upon the lapse
of restrictions on Restricted Stock and Restricted Stock Units, or upon the
achievement of Performance Measures related to Performance Shares, or any other
taxable event arising as a result of an Award granted hereunder, the Committee
may establish provisions in the applicable Award Agreements to satisfy the
withholding requirement, in whole or in part, by having the Company withhold
whole Shares having a Market Price on the date the tax is to be determined up to
the maximum statutory total tax withholding that could be imposed on the
transaction.

 

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Article 21.Successors

 

All obligations of the Company under this Plan with respect to Awards granted
hereunder shall be binding on any successor to the Company, regardless of
whether the existence of such successor is the result of a direct or indirect
purchase, merger, consolidation, or otherwise, of all or substantially all of
the business and/or assets of the Company.

 

Article 22.General Provisions

 

22.1      Forfeiture Events. Any Awards granted under the Plan will be subject
to recoupment in accordance with any clawback policy that the Company currently
has in effect, or is required to adhere to, adopt or modify, pursuant to the
listing standards of any national securities exchange or association on which
the Company’s securities are listed or as is otherwise required by the
Dodd-Frank Wall Street Reform and Consumer Protection Act or the Sarbanes-Oxley
Act of 2002, or other applicable law (“Clawback Policy”). In addition, the
Committee or the Board may impose such clawback, suspension, restriction,
recovery, or recoupment provisions in an Award Agreement as the Committee or the
Board determines necessary or appropriate, including, but not limited to, a
reacquisition right in respect of previously acquired Shares or other cash or
property, including the gains realized thereon, as set forth in the Award
Agreement. These conditions may include, without limitation, actions by the
Participant which constitute a conflict of interest with the Company, are
prejudicial to the Company’s interests, or are in violation of any non-compete
agreement or obligation, any confidentiality agreement or obligation, the
Company’s applicable policies or the Participant’s terms and conditions of
employment. The Committee may require, upon exercise, payment or delivery
pursuant to an award, that the Participant certify in a manner acceptable to the
Company that he or she is in compliance with the terms and conditions of the
Award. No recovery of compensation under this Section will be an event giving
rise to a right to resign for “good reason” or “constructive termination” (or
similar term) under any agreement or otherwise with the Company.

 

22.2      Legend. The certificates for Shares may include any legend which the
Committee deems appropriate to reflect any restrictions on transfer of such
Shares.

 

22.3      Gender and Number. Except where otherwise indicated by the context,
any masculine term used herein also shall include the feminine, the plural shall
include the singular, and the singular shall include the plural.

 

22.4      Severability. In the event any provision of this Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of this Plan, and this Plan shall be construed and enforced
as if the illegal or invalid provision had not been included.

 

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22.5      Requirements of Law. The granting of Awards and the issuance of Shares
under this Plan shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.

 

22.6      Delivery of Title. The Company shall have no obligation to issue or
deliver evidence of title for Shares issued under this Plan prior to:

 

(a)Obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and

 

(b)Completion of any registration or other qualification of the Shares under any
applicable national or foreign law or ruling of any governmental body that the
Company determines to be necessary or advisable.

 

22.7      Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

 

22.8      Investment Representations. The Committee may require any individual
receiving Shares pursuant to an Award under this Plan to represent and warrant
in writing that the individual is acquiring the Shares for investment and
without any present intention to sell or distribute such Shares.

 

22.9      Employees Based Outside the United States. Notwithstanding any
provision of this Plan to the contrary, in order to comply with the laws in
other countries in which the Company, its Affiliates, and/or its Subsidiaries
operate or have Employees, Nonemployee Directors, or Third Party Service
Providers, the Committee, in its sole discretion, shall have the power and
authority to:

 

(a)Determine which Affiliates and Subsidiaries shall be covered by this Plan;

 

(b)Determine which Employees, Nonemployee Directors, and/or Third Party Service
Providers outside the United States are eligible to participate in this Plan;

 

(c)Modify the terms and conditions of any Award granted to Employees,
Nonemployee Directors, and/or Third Party Service Providers outside the United
States to comply with applicable foreign laws;

 

(d)Establish subplans and modify exercise procedures and other terms and
procedures, to the extent such actions may be necessary or advisable. Any
subplans and modifications to Plan terms and procedures established under this
Section 21.9 by the Committee shall be attached to this Plan document as
appendices; and

 

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(e)Take any action, before or after an Award is made, that it deems advisable to
obtain approval or comply with any necessary local government regulatory
exemptions or approvals.

 

Notwithstanding the above, the Committee may not take any actions hereunder, and
no Awards shall be granted, that would violate applicable law.

 

22.10    Uncertificated Shares. To the extent that this Plan provides for
issuance of certificates to reflect the transfer of Shares, the transfer of such
Shares may be effected on a noncertificated basis, to the extent not prohibited
by applicable law or the rules of any stock exchange.

 

22.11    Unfunded Plan. Participants shall have no right, title, or interest
whatsoever in or to any investments that the Company, and/or its Subsidiaries,
and/or its Affiliates may make to aid it in meeting its obligations under this
Plan. Nothing contained in this Plan, and no action taken pursuant to its
provisions, shall create or be construed to create a trust of any kind, or a
fiduciary relationship between the Company and any Participant, beneficiary,
legal representative, or any other individual. To the extent that any individual
acquires a right to receive payments from the Company, its Subsidiaries, and/or
its Affiliates under this Plan, such right shall be no greater than the right of
an unsecured general creditor of the Company, a Subsidiary, or an Affiliate, as
the case may be. All payments to be made hereunder shall be paid from the
general funds of the Company, a Subsidiary, or an Affiliate, as the case may be
and no special or separate fund shall be established and no segregation of
assets shall be made to assure payment of such amounts except as expressly set
forth in this Plan.

 

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

 

22.13    Retirement and Welfare Plans. Neither Awards made under this Plan nor
Shares or cash paid pursuant to such Awards, except pursuant to Covered Employee
annual incentive awards, may be included as “compensation” for purposes of
computing the benefits payable to any Participant under the Company’s or any
Subsidiary’s or Affiliate’s retirement plans (both qualified and non-qualified)
or welfare benefit plans unless such other plan expressly provides that such
compensation shall be taken into account in computing a Participant’s benefit.

 

22.14    Deferred Compensation. If any Award would be considered non-qualified
deferred compensation as defined under Code Section 409A and if this Plan fails
to meet the requirements of Code Section 409A with respect to such Award, then
such Award shall be null and void. However, the Committee may permit deferrals
of compensation pursuant to the terms of a Participant’s Award Agreement, a
separate plan or a subplan which meets the requirements of Code Section 409A and
any related guidance. Additionally, to the extent any Award is subject to Code
Section 409A, notwithstanding any provision herein to the contrary, the Plan
does not permit the acceleration or delay of the time or schedule of any
distribution related to such Award, except as permitted by Code Section 409A,
the regulations thereunder, and/or the Secretary of the United States Treasury.
To the extent the Plan or an Award Agreement is required to be interpreted under
Code Section 409A, such interpretation shall be consistent, to the extent
feasible as determined by the Company, with the intent to not cause the
imposition of penalties under Code Section 409A.

 

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22.15    Nonexclusivity of this Plan. The adoption of this Plan shall not be
construed as creating any limitations on the power of the Board or Committee to
adopt such other compensation arrangements as it may deem desirable for any
Participant.

 

22.16    No Constraint on Corporate Action. Nothing in this Plan shall be
construed to: (i) limit, impair, or otherwise affect the Company’s or a
Subsidiary’s or an Affiliate’s right or power to make adjustments,
reclassifications, reorganizations, or changes of its capital or business
structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer
all or any part of its business or assets; or (ii) limit the right or power of
the Company or a Subsidiary or an Affiliate to take any action which such entity
deems to be necessary or appropriate.

 

22.17    Governing Law. The Plan and each Award Agreement shall be governed by
the laws of the State of Delaware, excluding any conflicts or choice of law rule
or principle that might otherwise refer construction or interpretation of this
Plan to the substantive law of another jurisdiction. Unless otherwise provided
in the Award Agreement, recipients of an Award under this Plan are deemed to
submit to the exclusive jurisdiction and venue of the federal or state courts of
Delaware, to resolve any and all issues that may arise out of or relate to this
Plan or any related Award Agreement.

 

22.18    Section 162(m). It is the intention of the Company that, unless
otherwise provided by the Committee, awards determined in accordance with this
Plan shall be excluded from the deduction limitations contained in Code Section
162(m). Therefore, subject to the Committee’s determination that an Award need
not meet the Performance-Based Compensation exception contained in Code section
162(m), if any Plan provision is found not to be in compliance with such
exception, that provision shall be deemed amended so that the Plan does so
comply to the extent permitted by law and deemed advisable by the Committee, and
in all such events the Plan shall be construed in favor of its meeting the
Performance-Based Compensation exception contained in Code Section 162(m).

 

As evidence of its adoption of this amendment and restatement of the Plan, the
Company has caused this document to be executed by its duly authorized officer
the 31st day of August, 2017.

 

  CINEDIGM CORP.         By:   /s/ Christopher J. McGurk     Name: Christopher
J. McGurk     Title: Chief Executive Officer

 

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