Exhibit 10.9

 

DIAMOND S SHIPPING inc.

 

2019 EQUITY and INCENTIVE Compensation PLAN

 

1.           Purpose. The purpose of this Plan is to attract and retain
non-employee Directors, Employees and certain consultants to the Company and its
Subsidiaries and to provide to such Persons incentives and rewards for service
and/or performance.

 

2.           Definitions. As used in this Plan:

 

(a)          “Appreciation Right” means a right granted pursuant to Section 5 of
this Plan.

 

(b)          “Base Price” means the price to be used as the basis for
determining the Spread upon the exercise of an Appreciation Right.

 

(c)          “Board” means the Board of Directors of the Company.

 

(d)          “Change in Control” has the meaning set forth in Section 12 of this
Plan.

 

(e)          “Code” means the Internal Revenue Code of 1986, as amended from
time to time.

 

(f)          “Committee” means the Compensation Committee of the Board (or its
successor(s)) or any other committee of the Board designated by the Board to
administer this Plan pursuant to Section 10 of this Plan; provided that,
“Committee” will mean the Board with respect to Participants who are
non-employee Directors.

 

(g)          “Common Stock” means the common stock, no par value, 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 11 of this Plan.

 

(h)          “Company” means Diamond S Shipping Inc., a Marshall Islands
corporation, and its successors.

 

(i)          “Date of Grant” means the date provided for by the Committee on
which a grant of Option Rights, 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 Committee takes action with respect
thereto).

 

(j)          “Director” means a member of the Board.

 

(k)          “Effective Date” means the date that the Common Stock is listed for
trading on the NYSE.

 

 

 

 

(l)          “Employee” means any individual, including officers and Directors,
employed by the Company or any Subsidiary. Neither service as a Director nor
payment of a director’s fee by the Company will be sufficient to constitute
“employment” by the Company or any Subsidiary.

 

(m)          “Evidence of Award” means an agreement, certificate, resolution or
other type or form of writing or other evidence approved by the Committee that
sets forth the terms and conditions of the awards granted under this Plan. 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
Committee, need not be signed by a representative of the Company or a
Participant.

 

(n)          “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.

 

(o)          “Incentive Stock Option” means an Option Right that is intended to
qualify as an “incentive stock option” 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 Committee, Option Rights, Appreciation Rights, Restricted
Stock, Restricted Stock Units, dividend equivalents or other awards pursuant to
this Plan. If the Committee 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 Committee may in its discretion
modify such Management Objectives or the acceptable levels of achievement, in
whole or in part, as the Committee deems appropriate and equitable.

 

(q)          “Market Value per Share” means, as of any particular date, if the
Common Stock is listed on any established stock exchange or traded on any
established market, and unless otherwise determined by the Committee, the
closing price of a share of Common Stock as quoted on such exchange or market on
the date of determination, as reported in a source the Committee deems reliable.
If there is no closing price for the Common Stock on the particular date, then
the Market Value per Share will be the closing price on the last preceding date
for which such quotation exists. If there is no regular public trading market
for the shares of Common Stock, then the Market Value per Share will be the fair
market value as determined in good faith by the Committee. The Committee is
authorized to adopt another fair market value pricing method provided such
method is stated in the applicable Evidence of Award and is in compliance with
the fair market value pricing rules set forth in Section 409A of the Code.

 

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

 

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

 

(t)          “Option Right” means the right to purchase shares of Common Stock
upon exercise of an award granted pursuant to Section 4 of this Plan.

 

(u)          “Participant” means a Person who is selected by the Committee to
receive benefits under this Plan and who is at the time (i) an Employee,
including an individual who has agreed to commence serving in such capacity
within 90 days of the Date of Grant, (ii) a consultant (provided that such
Person satisfies the Form S-8 definition of “employee”) or (iii) a non-employee
Director.

 

(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 achieved.

 

(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 Committee.

 

(y)          “Person” means any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

 

(z)          “Plan” means this Equity and Incentive Compensation Plan, as may be
amended or amended and restated from time to time.

 

(aa)         “Restricted Stock” means shares of Common Stock granted or sold
pursuant to Section 6 of this Plan as to which neither the substantial risk of
forfeiture nor the prohibition on transfers has expired.

 

(bb)         “Restricted Stock Units” means an award made pursuant to Section 7
of this Plan of the right to receive shares of Common Stock, cash or a
combination thereof at the end of the applicable Restriction Period.

 

(cc)         “Restriction Period” means the period of time during which
Restricted Stock Units are subject to restrictions, as provided in Section 7 of
this Plan.

 

(dd)         “Spread” means the excess of the Market Value per Share on the date
when an Appreciation Right is exercised over the Base Price provided for with
respect to the Appreciation Right.

 

(ee)         “Stockholder” means an individual or entity that owns one or more
shares of Common Stock.

 

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(ff)         “Subsidiary” means a corporation, company or other entity (i) more
than 50% 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, limited liability company, unincorporated
association or other similar entity), but more than 50% of whose ownership
interest representing the right generally to make decisions for such other
entity is, at such applicable time, owned or controlled, directly or indirectly,
by the Company; provided, however, that for purposes of determining whether any
individual may be a Participant for purposes of any grant of Incentive Stock
Options, “Subsidiary” means any corporation in which the Company at the time
owns or controls, directly or indirectly, more than 50% of the total combined
Voting Power represented by all classes of stock issued by such corporation.

 

(gg)         “Voting Power” means, at any time, the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
Directors in the case of the Company or members of the board of directors or
similar body in the case of another entity.

 

3.           Shares Available Under This Plan.

 

(a)          Maximum Shares Available Under This Plan.

 

(i)          Subject to adjustment as provided in Section 11 of this Plan and
the share counting rules set forth in Section 3(b) of this Plan, the number of
shares of Common Stock available under this Plan for awards of (A) Option Rights
or Appreciation Rights, (B) Restricted Stock, (C) Restricted Stock Units,
(D) Performance Shares or Performance Units, (E) awards contemplated by
Section 9 of this Plan or (F) dividend equivalents paid with respect to awards
made under this Plan will not exceed in the aggregate 3,989,000 shares of Common
Stock. Such shares may be shares of original issuance or treasury shares or a
combination of the foregoing.

 

(ii)         The aggregate number of shares of Common Stock available under
Section 3(a)(i) of this Plan will be reduced by (A) one share of Common Stock
for every one share of Common Stock subject to an award of Option Rights or
Appreciation Rights granted under this Plan, and (B) two shares of Common Stock
for every one share of Common Stock subject to an award other than of Option
Rights or Appreciation Rights granted under this Plan.

 

(b)          Share Counting Rules.

 

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(i)          Except as provided in Section 22 of this Plan, if any award granted
under this Plan (in whole or in part) is cancelled or forfeited, expires, is
settled for cash or is unearned, the shares of Common Stock subject to such
award will, to the extent of such cancellation, forfeiture, expiration, cash
settlement or unearned amount, again be available under Section 3(a)(i) above
(at a rate of one share of Common Stock for every one share of Common Stock
subject to awards of Option Rights or Appreciation Rights and two shares of
Common Stock for every one share of Common Stock subject to awards other than of
Option Rights or Appreciation Rights).

 

(ii)         Notwithstanding anything to the contrary contained in this Plan:
(A) shares of Common Stock withheld by the Company, tendered or otherwise used
in payment of the Option Price of an Option Right will not be added (or added
back, as applicable) to the aggregate number of shares of Common Stock available
under Section 3(a)(i) of this Plan; (B) shares of Common Stock withheld by the
Company, tendered or otherwise used to satisfy tax withholding with respect to
awards other than as described in clause (C) will not be added (or added back,
as applicable) to the aggregate number of shares of Common Stock available under
Section 3(a)(i) of this Plan; (C) shares of Common Stock withheld by the
Company, tendered or otherwise used prior to the tenth anniversary of the
Effective Date to satisfy tax withholding with respect to awards other than
Option Rights or Appreciation Rights will be added back (but only to the extent
such withholding did not exceed the minimum amounts of tax required to be
withheld) to the aggregate number of shares of Common Stock available under
Section 3(a)(i) of this Plan; (D) shares of Common Stock subject to an
Appreciation Right that are not actually issued in connection with the
settlement of such Appreciation Right on the exercise thereof will not be added
back to the aggregate number of shares of Common Stock available under
Section 3(a)(i) of this Plan; and (E) shares of Common Stock reacquired by the
Company on the open market or otherwise using cash proceeds from the exercise of
Option Rights will not be added (or added back, as applicable) to the aggregate
number of shares of Common Stock available under Section 3(a)(i) of this Plan.

 

(iii)        If, under this Plan, a Participant has elected to give up the right
to receive compensation in exchange for shares of Common Stock based on fair
market value, such shares of Common Stock will not count against the aggregate
limit under Section 3(a)(i) of this Plan.

 

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(c)          Limit on Incentive Stock Options. Notwithstanding anything to the
contrary contained in this Plan, and subject to adjustment as provided in
Section 11 of this Plan, the aggregate number of shares of Common Stock actually
issued or transferred by the Company upon the exercise of Incentive Stock
Options will not exceed 3,989,000 shares of Common Stock.

 

(d)          Individual Director Limit. Notwithstanding anything to the contrary
contained in this Plan, and subject to adjustment as provided in Section 11 of
this Plan, in no event will any non-employee Director in any one calendar year
be granted compensation for such service having an aggregate maximum value
(measured at the Date of Grant as applicable, and calculating the value of any
awards under this Plan based on the grant date fair value for financial
reporting purposes) in excess of $350,000.

 

4.           Option Rights. The Committee may, from time to time and upon such
terms and conditions as it may determine, authorize the granting to Participants
of Option Rights. Each such grant may utilize any or all of the authorizations,
and will be subject to all of the requirements, contained in the following
provisions:

 

(a)          Each grant 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 grant will specify an Option Price per share of Common Stock,
which (except with respect to awards under Section 22 of this Plan) may not be
less than the Market Value per Share on the Date of Grant.

 

(c)          Each grant will specify whether the Option Price will be payable
(i) in cash, by check acceptable to the Company or by wire transfer of
immediately available funds, (ii) by the actual or constructive transfer to the
Company of shares of Common Stock owned by the Optionee having a value at the
time of exercise equal to the total Option Price, (iii) subject to any
conditions or limitations established by the Committee, by the withholding of
shares of Common Stock otherwise issuable upon exercise of an Option Right
pursuant to a “net exercise” arrangement (it being understood that, solely for
purposes of determining the number of treasury shares held by the Company, the
shares of Common Stock so withheld will not be treated as issued and acquired by
the Company upon such exercise), (iv) by a combination of such methods of
payment or (v) by such other methods as may be approved by the Committee.

 

(d)          To the extent permitted by law, any grant may provide for deferred
payment of the Option Price from the proceeds of sale through a bank or broker
on a date satisfactory to the Company of some or all of the shares of Common
Stock to which such exercise relates.

 

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

 

(f)          Each grant will specify the period or periods of continuous service
by the Optionee with the Company or any Subsidiary, if any, that is necessary
before any Option Rights or installments thereof will become exercisable. Option
Rights may provide for continued vesting or the earlier exercise of such Option
Rights, including in the event of the retirement, death or disability of a
Participant or in the event of a Change in Control.

 

(g)          Any grant of Option Rights may specify Management Objectives that
must be achieved as a condition to the exercise of such rights.

 

(h)          Option Rights granted under this Plan may be (i) options, including
Incentive Stock Options, that are intended to qualify under particular
provisions of the Code, (ii) options that are not intended to so qualify or
(iii) combinations of the foregoing. Incentive Stock Options may only be granted
to Participants who meet the definition of “employees” under Section 3401(c) of
the Code.

 

(i)          No Option Right will be exercisable more than 10 years from the
Date of Grant. The Committee may provide in any Evidence of Award for the
automatic exercise of an Option Right upon such terms and conditions as
established by the Committee.

 

(j)          Option Rights granted under this Plan may not provide for any
dividends or dividend equivalents thereon.

 

(k)          Each grant of Option Rights will be evidenced by an Evidence of
Award. Each Evidence of Award will be subject to this Plan and will contain such
terms and provisions, consistent with this Plan, as the Committee may approve.

 

5.           Appreciation Rights.

 

(a)          The Committee may, from time to time and upon such terms and
conditions as it may determine, authorize the granting to any Participant of
Appreciation Rights. An Appreciation Right will be the right of the Participant
to receive from the Company an amount determined by the Committee, which will be
expressed as a percentage of the Spread (not exceeding 100%) at the time of
exercise.

 

(b)          Each grant of Appreciation Rights may utilize any or all of the
authorizations, and will be subject to all of the requirements, contained in the
following provisions:

 

(i)           Each grant may specify that the amount payable on exercise of an
Appreciation Right will be paid by the Company in cash, shares of Common Stock
or any combination thereof.

 

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(ii)         Any grant may specify that the amount payable on exercise of an
Appreciation Right may not exceed a maximum specified by the Committee on the
Date of Grant.

 

(iii)         Any grant may specify waiting periods before exercise and
permissible exercise dates or periods.

 

(iv)         Each grant 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 Appreciation Rights or installments thereof will become exercisable.
Appreciation Rights may provide for continued vesting or the earlier exercise of
such Appreciation Rights, including in the event of the retirement, death or
disability of a Participant or in the event of a Change in Control.

 

(v)          Any grant of Appreciation Rights may specify Management Objectives
that must be achieved as a condition of the exercise of such Appreciation
Rights.

 

(vi)         Appreciation Rights granted under this Plan may not provide for any
dividends or dividend equivalents thereon.

 

(vii)        Successive grants of Appreciation Rights may be made to the same
Participant regardless of whether any Appreciation Rights previously granted to
the Participant remain unexercised.

 

(viii)       Each grant of Appreciation Rights will be evidenced by an Evidence
of Award. Each Evidence of Award will be subject to this Plan and will contain
such terms and provisions, consistent with this Plan, as the Committee may
approve.

 

(ix)          Each grant will specify in respect of each Appreciation Right a
Base Price, which (except with respect to awards under Section 22 of this Plan)
may not be less than the Market Value per Share on the Date of Grant.

 

(x)           No Appreciation Right granted under this Plan may be exercised
more than 10 years from the Date of Grant. The Committee may provide in any
Evidence of Award for the automatic exercise of an Appreciation Right upon such
terms and conditions as established by the Committee.

 

6.           Restricted Stock. The Committee may, from time to time and upon
such terms and conditions as it may determine, authorize the grant or sale of
Restricted Stock to Participants. Each such grant or sale may utilize any or all
of the authorizations, and will be subject to all of the requirements, contained
in the following provisions:

 

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(a)          Each such grant or sale will constitute an immediate transfer of
the ownership of shares 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 described.

 

(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 the Market Value per Share on the Date of Grant.

 

(c)          Each such grant or sale 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 for a period to be
determined by the Committee on the Date of Grant or until achievement of
Management Objectives referred to in Section 6(e) of this Plan.

 

(d)          Each such grant or sale will provide that during or after the
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 Committee on the Date of Grant (which
restrictions may include rights of repurchase or first refusal of the Company or
provisions subjecting the Restricted Stock to a continuing substantial risk of
forfeiture while held by any transferee).

 

(e)          Any grant of Restricted Stock may specify Management Objectives
that, if achieved, will result in termination or early termination of the
restrictions applicable to such Restricted Stock.

 

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

 

(g)          Any such grant or sale of Restricted Stock will require that any
and all dividends or other distributions paid thereon during the period of such
restrictions be automatically deferred and/or reinvested in additional
Restricted Stock, which will be subject to the same restrictions as the
underlying award. For the avoidance of doubt, any such dividends or other
distributions on Restricted Stock will be deferred until, and paid contingent
upon, the vesting of such Restricted Stock.

 

(h)          Each grant or sale of Restricted Stock will be evidenced by an
Evidence of Award. Each Evidence of Award will be subject to this Plan and will
contain such terms and provisions, consistent with this Plan, as the Committee
may approve. Unless otherwise directed by the Committee, (i) all certificates
representing 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 Restricted Stock will be
held at the Company’s transfer agent in book entry form with appropriate
restrictions relating to the transfer of such Restricted Stock.

 

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7.           Restricted Stock Units. The Committee may, from time to time and
upon such terms and conditions as it may determine, authorize the granting or
sale of Restricted Stock Units to Participants. Each such grant or sale may
utilize any or all of the authorizations, and will be subject to all of the
requirements, contained in the following provisions:

 

(a)          Each such grant or sale will constitute the agreement by the
Company to deliver shares of Common Stock or cash, or a combination 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
Committee may specify.

 

(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 the Market Value per Share on the Date of Grant.

 

(c)          Notwithstanding anything to the contrary contained in this Plan,
Restricted Stock Units may provide for continued vesting or the earlier lapse or
other modification of the Restriction Period, including in the event of the
retirement, death or disability of a Participant or in the event of a Change in
Control.

 

(d)          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 shares of Common Stock deliverable upon payment of the
Restricted Stock Units and will have no right to vote them, but the Committee
may, at or after the Date of Grant, authorize the payment of dividend
equivalents on such Restricted Stock Units on a deferred and contingent basis,
either in cash or in additional shares of Common Stock; provided, however, that
dividend equivalents or other distributions on shares of Common Stock underlying
Restricted Stock Units will be deferred until and paid contingent upon the
vesting of such Restricted Stock Units.

 

(e)          Each grant or sale of Restricted Stock Units will specify the time
and manner of payment of the Restricted Stock Units that have been earned. Each
grant or sale will specify that the amount payable with respect thereto will be
paid by the Company in whole shares of Common Stock or cash, or a combination
thereof. Any fractional amounts may be rounded up or down to the nearest whole
number or payable in cash, in any such case, as may be determined by the
Committee in its sole discretion.

 

(f)          Each grant or sale of Restricted Stock Units will be evidenced by
an Evidence of Award. Each Evidence of Award will be subject to this Plan and
will contain such terms and provisions, consistent with this Plan, as the
Committee may approve.

 

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8.           Performance Shares and Performance Units. The Committee may, from
time to time and upon such terms and conditions as it may determine, authorize
the granting of Performance Shares and Performance Units. Each such grant may
utilize any or all of the authorizations, and will be subject to all of the
requirements, contained in the following provisions:

 

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

 

(b)          The Performance Period with respect to each grant of Performance
Shares or Performance Units will be such period of time as will be determined by
the Committee, which may be subject to continued vesting or earlier lapse or
other modification, including in the event of the retirement, death or
disability of a Participant or in the event of a Change in Control.

 

(c)          Each grant of Performance Shares or Performance Units will specify
Management Objectives which, if achieved, will result in payment or early
payment of the award, and each grant may specify in respect of such specified
Management Objectives a minimum acceptable level or levels 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.

 

(d)          Each grant will specify the time and manner of payment of
Performance Shares or Performance Units that have been earned. Any grant may
specify that the amount payable with respect thereto may be paid by the Company
in cash, in shares of Common Stock, in Restricted Stock or Restricted Stock
Units or in any combination thereof.

 

(e)          Any grant of Performance Shares or Performance Units may specify
that the amount payable or the number of shares of Common Stock, Restricted
Stock or Restricted Stock Units payable with respect thereto may not exceed a
maximum specified by the Committee on the Date of Grant.

 

(f)          The Committee may, on the Date of Grant of Performance Shares or
Performance Units, 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 deferral and payment on a contingent basis based on the Participant’s
earning and vesting of the Performance Shares or Performance Units, as
applicable, with respect to which such dividend equivalents are paid.

 

(g)          Each grant of Performance Shares or Performance Units will be
evidenced by an Evidence of Award. Each Evidence of Award will be subject to
this Plan and will contain such terms and provisions, consistent with this Plan,
as the Committee may approve.

 

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9.           Other Awards.

 

(a)          Subject to applicable law and the applicable limits set forth in
Section 3 of this Plan, the Committee may authorize the grant to any Participant
of shares of Common Stock or such other awards that may be denominated or
payable in, valued in whole or in part by reference to, or otherwise based on,
or relating 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 shares of Common
Stock, purchase rights for shares of 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
Committee, and awards valued by reference to the book value of the 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 Committee
will 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 will be purchased for such consideration, paid for at such time,
by such methods, and in such forms, including, without limitation, shares of
Common Stock, other awards, notes or other property, as the Committee
determines.

 

(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.

 

(c)          The Committee may authorize the grant of shares of Common Stock as
a bonus, or may authorize the grant of 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
will be determined by the Committee in a manner that complies with Section 409A
of the Code.

 

(d)          The Committee may, at or after the Date of Grant, authorize the
payment of dividends or dividend equivalents on awards granted under this
Section 9 on a deferred and contingent basis, either in cash or in additional
shares of Common Stock; provided, however, that dividend equivalents or other
distributions on shares of Common Stock underlying awards granted under this
Section 9 will be deferred until and paid contingent upon the earning and
vesting of such awards.

 

(e)          The Evidence of Award will specify the time and terms of delivery
of an award granted under this Section 9.

 

(f)           Notwithstanding anything to the contrary contained in this Plan,
awards under this Section 9 may provide for the earning or vesting of, or
earlier elimination of restrictions applicable to, such award, including in the
event of the retirement, death or disability of a Participant or in the event of
a Change in Control.

 

10.          Administration of This Plan.

 

(a)          This Plan will be administered by the Committee. The Committee may
from time to time delegate all or any part of its authority under this Plan to a
subcommittee thereof. To the extent of any such delegation, references in this
Plan to the Committee will be deemed to be references to such subcommittee.

 

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(b)          The interpretation and construction by the Committee of any
provision of this Plan or of any Evidence of Award (or related documents) and
any determination by the Committee pursuant to any provision of this Plan or of
any such agreement, notification or document will be final and conclusive. No
member of the Committee will be liable for any such action or determination made
in good faith. In addition, the Committee is authorized to take any action it
determines in its sole discretion to be appropriate subject only to the express
limitations contained in this Plan, and no authorization in any Plan section or
other provision of this Plan is intended or may be deemed to constitute a
limitation on the authority of the Committee.

 

(c)          To the extent permitted by law, the Committee may delegate to one
or more of its members, 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 Committee, the subcommittee, 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 Committee, the subcommittee
or such Person may have under this Plan. The Committee may, by resolution,
authorize one or more officers of the Company to do one or both of the following
on the same basis as the Committee: (i) designate employees to be recipients of
awards under this Plan; and (ii) determine the size of any such awards;
provided, however, that (A) the Committee will 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” (as such term is defined
in Rule 13d-3 promulgated under 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 Committee in accordance with Section 16 of the Exchange
Act; (B) the resolution providing for such authorization will set forth the
total number of shares of Common Stock such officer(s) may grant; and (C) the
officer(s) will report periodically to the Committee regarding the nature and
scope of the awards granted pursuant to the authority delegated.

 

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11.          Adjustments. The Committee will make or provide for such
adjustments in the number of and kind of shares of Common Stock covered by
outstanding Option Rights, Appreciation Rights, Restricted Stock, Restricted
Stock Units, Performance Shares and Performance Units granted hereunder and, if
applicable, in the number of and kind of shares of Common Stock covered by other
awards granted pursuant to Section 9 of this Plan, in the Option Price and Base
Price provided in outstanding Option Rights and Appreciation Rights,
respectively, and in other award terms, as the Committee, in its sole
discretion, exercised in good faith, determines is equitably required to prevent
dilution or enlargement of the rights of Participants that otherwise would
result from (a) any extraordinary cash dividend, 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. Moreover, in the event of any such transaction or event or in the
event of a Change in Control, the Committee may provide in substitution for any
or all outstanding awards under this Plan such alternative consideration
(including cash), if any, as it, in good faith, may determine to be equitable in
the circumstances and will require in connection therewith the surrender of all
awards so replaced in a manner that complies with Section 409A of the Code. In
addition, for each Option Right or Appreciation Right with an Option Price or
Base Price, respectively, greater than or equal to the consideration offered in
connection with any such transaction or event or Change in Control, the
Committee may in its discretion elect to cancel such Option Right or
Appreciation Right without any payment to the Person holding such Option Right
or Appreciation Right. The Committee will also make or provide for such
adjustments in the number of shares of Common Stock specified in Section 3 of
this Plan as the Committee in its sole discretion, exercised in good faith,
determines is appropriate to reflect any transaction or event described in this
Section 11; provided, however, that any such adjustment to the number specified
in Section 3(c) of this Plan will be made only if and to the extent that such
adjustment would not cause any Option Right intended to qualify as an Incentive
Stock Option to fail to so qualify.

 

12.          Change in Control. For purposes of this Plan, a “Change in Control”
will have the meaning in the applicable Evidence of Award.

 

13.          Detrimental Activity and Recapture Provisions. Any Evidence of
Award may reference a clawback policy of the Company or 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 by the
Committee from time to time, if a Participant, either (a) during employment or
other service with the Company or a Subsidiary, or (b) within a specified period
after termination of such employment or service, engages in any detrimental
activity, as described in the applicable Evidence of Award or such clawback
policy. In addition, notwithstanding anything in this Plan to the contrary, any
Evidence of Award or such clawback policy may also provide for the cancellation
or forfeiture of an award or the forfeiture and repayment to the Company of any
shares of Common Stock issued under and/or any other benefit related to an
award, or other provisions intended to have a similar effect, upon such terms
and conditions as may be required by the Committee or under Section 10D of the
Exchange Act and any applicable rules or regulations promulgated by the
Securities and Exchange Commission or any national securities exchange or
national securities association on which the shares of Common Stock may be
traded.

 

14.          Non-U.S. Participants. In order to facilitate the making of any
grant or combination of grants under this Plan, the Committee 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 or any Subsidiary under an
agreement with a foreign nation or agency, as the Committee may consider
necessary or appropriate to accommodate differences in local law, tax policy or
custom. Moreover, the Committee may approve such supplements to or amendments,
restatements or alternative versions of this Plan (including 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.

 

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15.          Transferability.

 

(a)          Except as otherwise determined by the Committee, no Option Right,
Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance Share,
Performance Unit, award contemplated by Section 9 of this Plan or dividend
equivalents paid with respect to awards made under this Plan will be
transferable by the Participant except by will or the laws of descent and
distribution. In no event will any such award granted under this Plan be
transferred for value. Except as otherwise determined by the Committee, Option
Rights and 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 or court
supervision.

 

(b)          The Committee may specify on the Date of Grant that part or all of
the shares of Common Stock that are (i) to be issued or transferred by the
Company upon the exercise of Option Rights or Appreciation Rights, upon the
termination of the Restriction Period applicable to Restricted Stock Units or
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, including minimum holding periods.

 

16.          Withholding Taxes. To the extent that the Company is required to
withhold federal, state, local or foreign taxes or other amounts 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 or other amounts required to be withheld, which arrangements (in the
discretion of the Committee) may include relinquishment of a portion of such
benefit. If a Participant’s benefit is to be received in the form of shares of
Common Stock, and such Participant fails to make arrangements for the payment of
taxes or other amounts, then, unless otherwise determined by the Committee, the
Company will withhold shares of Common Stock having a value equal to the amount
required to be withheld. Notwithstanding the foregoing, when a Participant is
required to pay the Company an amount required to be withheld under applicable
income, employment, tax or other laws, the Participant may elect, unless
otherwise determined by the Committee, to satisfy the obligation, in whole or in
part, by having withheld, from the shares of Common Stock 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 of Common Stock used for tax
or other withholding will be valued at an amount equal to the fair market value
of such shares of Common Stock on the date the benefit is to be included in
Participant’s income. In no event will the fair market value of the shares of
Common Stock to be withheld and delivered pursuant to this Section 16 exceed the
minimum amount required to be withheld, unless (i) an additional amount can be
withheld and not result in adverse accounting consequences, (ii) such additional
withholding amount is authorized by the Committee, and (iii) the total amount
withheld does not exceed the Participant’s estimated tax obligations
attributable to the applicable transaction. Participants will also make such
arrangements as the Company may require for the payment of any withholding tax
or other obligation that may arise in connection with the disposition of shares
of Common Stock acquired upon the exercise of Option Rights.

 

 15 

 

 

17.          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 will 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 will 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
owed by a Participant to the Company or any of its Subsidiaries.

 

(c)          If, at the time of a Participant’s separation from service (within
the meaning of Section 409A of the Code), (i) the Participant will 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 makes 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 will not pay
such amount on the otherwise scheduled payment date but will instead pay it,
without interest, on the first business day of the seventh month after such
separation from service.

 

 16 

 

 

(d)          Solely with respect to any award that constitutes nonqualified
deferred compensation subject to Section 409A of the Code and that is payable on
account of a Change in Control (including any installments or stream of payments
that are accelerated on account of a Change in Control), a Change in Control
will occur only if such event also constitutes a “change in the ownership,”
“change in effective control,” and/or a “change in the ownership of a
substantial portion of assets” of the Company as those terms are defined under
Treasury Regulation §1.409A-3(i)(5), but only to the extent necessary to
establish a time and form of payment that complies with Section 409A of the
Code, without altering the definition of Change in Control for any purpose in
respect of such award.

 

(e)          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 will 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 will have any obligation to indemnify or
otherwise hold a Participant harmless from any or all of such taxes or
penalties.

 

18.          Amendments.

 

(a)          The Board may at any time and from time to time amend this Plan in
whole or in part; provided, however, that if an amendment to this Plan, for
purposes of applicable stock exchange rules and except as permitted under
Section 11 of this Plan, (i) would materially increase the benefits accruing to
Participants under this Plan, (ii) would materially increase the number of
securities which may be issued under this Plan, (iii) would materially modify
the requirements for participation in this Plan, or (iv) must otherwise be
approved by the Stockholders in order to comply with applicable law or the rules
of the New York Stock Exchange or, if the shares of Common Stock are not traded
on the New York Stock Exchange, the principal national securities exchange upon
which the shares of Common Stock are traded or quoted, all as determined by the
Board, 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 11 of this Plan or in connection with a Change in Control,
the terms of outstanding awards may not be amended to reduce the Option Price of
outstanding Option Rights or the Base Price of outstanding Appreciation Rights,
or cancel outstanding “underwater” Option Rights or Appreciation Rights
(including following a Participant’s voluntary surrender of “underwater” Option
Rights or Appreciation Rights) in exchange for cash, other awards or Option
Rights or Appreciation Rights with an Option Price or Base Price, as applicable,
that is less than the Option Price of the original Option Rights or Base Price
of the original Appreciation Rights, as applicable, without Stockholder
approval. This Section 18(b) is intended to prohibit the repricing of
“underwater” Option Rights and Appreciation Rights and will not be construed to
prohibit the adjustments provided for in Section 11 of this Plan.
Notwithstanding any provision of this Plan to the contrary, this Section 18(b)
may not be amended without approval by the Stockholders.

 

 17 

 

 

(c)          If permitted by Section 409A of the Code, but subject to the
paragraph that follows, including in the case of termination of employment or
service, or in the case of unforeseeable emergency or other circumstances or in
the event of a Change in Control, to the extent a Participant holds an Option
Right or Appreciation Right not immediately exercisable in full, or any
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
dividend equivalents or other awards made pursuant to Section 9 of this Plan
subject to any vesting schedule or transfer restriction, or who holds shares of
Common Stock subject to any transfer restriction imposed pursuant to
Section 15(b) of this Plan, the Committee may, in its sole discretion, provide
for continued vesting or accelerate the time at which such Option Right,
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 18(b) of this Plan, the Committee may amend the
terms of any award theretofore granted under this Plan prospectively or
retroactively. Except for adjustments made pursuant to Section 11 of this Plan,
no such amendment will materially impair the rights 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.

 

19.          Governing Law. This Plan and all grants and awards and actions
taken hereunder will be governed by and construed in accordance with the
internal substantive laws of the Republic of the Marshall Islands.

 

20.          Effective Date/Termination. This Plan will be effective as of the
Effective Date. No grant will be made under this Plan on or after the tenth
anniversary of the Effective Date, but all grants made prior to such date will
continue in effect thereafter subject to the terms thereof and of this Plan.

 

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21.          Miscellaneous Provisions.

 

(a)          The Company will not be required to issue any fractional shares of
Common Stock pursuant to this Plan. The Committee 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)           Except with respect to Section 21(e) of this Plan, to the extent
that any provision of this Plan would prevent any Option Right 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 Right. Such provision,
however, will remain in effect for other Option Rights 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 Company, contrary to law or the regulations
of any duly constituted authority having jurisdiction over this Plan.

 

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

 

(f)           No Participant will have any rights as a Stockholder with respect
to any shares of Common Stock 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 of Common Stock upon the stock records of the Company.

 

(g)          The Committee may 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)          Except with respect to Option Rights and Appreciation Rights, the
Committee may permit Participants to elect to defer the issuance of shares of
Common Stock under this Plan pursuant to such rules, procedures or programs as
it may establish for purposes of this Plan and which are intended to comply with
the requirements of Section 409A of the Code. The Committee also may provide
that deferred issuances and settlements include the crediting of dividend
equivalents or interest on the deferral amounts.

 

(i)           If any provision of this Plan is or becomes invalid or
unenforceable in any jurisdiction, or would disqualify this Plan or any award
under any law deemed applicable by the Committee, such provision will be
construed or deemed amended or limited in scope to conform to applicable laws
or, in the discretion of the Committee, it will be stricken and the remainder of
this Plan will remain in full force and effect. Notwithstanding anything in this
Plan or an Evidence of Award to the contrary, nothing in this Plan or in an
Evidence of Award prevents a Participant from providing, without prior notice to
the Company, information to governmental authorities regarding possible legal
violations or otherwise testifying or participating in any investigation or
proceeding by any governmental authorities regarding possible legal violations,
and for purpose of clarity a Participant is not prohibited from providing
information voluntarily to the Securities and Exchange Commission pursuant to
Section 21F of the Exchange Act.

 

 19 

 

 

22.          Stock-Based Awards in Substitution for Awards Granted by Another
Company. Notwithstanding anything in this Plan to the contrary:

 

(a)          Awards may be granted under this Plan in substitution for or in
conversion of, or in connection with an assumption of, stock options, stock
appreciation rights, restricted stock, restricted stock units or other stock or
stock-based awards held by awardees of an entity engaging in a corporate
acquisition or merger transaction with the Company or any Subsidiary. Any
conversion, substitution or assumption will be effective as of the close of the
merger or acquisition, and, to the extent applicable, will be conducted in a
manner that complies with Section 409A of the Code. The awards so granted may
reflect the original terms of the awards being assumed or substituted or
converted for and need not comply with other specific terms of this Plan, and
may account for shares of Common Stock substituted for the securities covered by
the original awards and the number of shares subject to the original awards, as
well as any exercise or purchase prices applicable to the original awards,
adjusted to account for differences in stock prices in connection with the
transaction.

 

(b)          In the event that a company acquired by the Company or any
Subsidiary or with which the Company or any Subsidiary merges has shares
available under a pre-existing plan previously approved by stockholders and not
adopted in contemplation of such acquisition or merger, the shares available for
grant pursuant to the terms of such plan (as adjusted, to the extent
appropriate, to reflect such acquisition or merger) may be used for awards made
after such acquisition or merger under this Plan; provided, however, that awards
using such available shares may not be made after the date awards or grants
could have been made under the terms of the pre-existing plan absent the
acquisition or merger, and may only be made to individuals who were not
employees or directors of the Company or any Subsidiary prior to such
acquisition or merger.

 

(c)          Any shares of Common Stock that are issued or transferred by, or
that are subject to any awards that are granted by, or become obligations of,
the Company under Section 22(a) or 22(b) of this Plan will not reduce the shares
of Common Stock available for issuance or transfer under this Plan or otherwise
count against the limits contained in Section 3 of this Plan. In addition, no
shares of Common Stock subject to an award that is granted by, or becomes an
obligation of, the Company under Section 22(a) or 22(b) of this Plan will be
added to the aggregate limit contained in Section 3(a)(i) of this Plan.

 

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