Exhibit 10.8
THE PRINTRONIX, INC.
2005 STOCK OPTION PLAN

1   PURPOSE       This 2005 Stock Option Plan (the “Plan”), is intended to
encourage stock ownership by employees of Printronix, Inc. (the “Corporation”),
its divisions and Subsidiary Corporations, so that they may acquire or increase
their proprietary interest in the Corporation, and to attract persons of
training, experience and ability and to encourage such employees to remain in
the employ of the Corporation, its divisions and Subsidiary Corporations, and to
put forth maximum efforts for the success of the business. The Plan is also
intended to encourage directors of the Corporation who are not employees or
officers of the Corporation or its Subsidiary Corporations (“Eligible
Directors”) to acquire or increase a proprietary interest in the Corporation, to
further promote and strengthen the interest of such Eligible Directors in the
development and financial success of the Corporation, and to assist the
Corporation in attracting and retaining highly qualified directors by providing
such directors options to purchase shares of Common Stock. It is further
intended that no Option granted pursuant to this Plan shall constitute an
incentive stock option (“Incentive Stock Option”) within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (“Code”), and all
Options so granted shall constitute nonqualified stock options (“Nonqualified
Stock Options”).   2   DEFINITIONS       As used in this Plan, the following
words and phrases shall have the meanings indicated:

  (a)   “CAUSE” used in connection with the termination of employment or service
of a Grantee, shall mean a termination of employment or service of the Grantee
by the Corporation or a division or Subsidiary Corporation due to (i) the
Grantee’s failure to render services in accordance with the terms of such
Grantee’s employment or service, which failure amounts to a material neglect of
such Grantee’s duties, (ii) the commission by the Grantee of an act of fraud,
misappropriation (including the unauthorized disclosure of confidential or
proprietary information) or embezzlement, or (iii) a conviction of or guilty
plea or confession to any felony.     (b)   “COMMON STOCK” shall mean shares of
the Corporation’s Common Stock, par value $.01 per share.

 

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

 

  (c)   “DISABILITY” shall mean a Grantee’s inability to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death or that has lasted or
can be expected to last for a continuous period of not less than twelve
(12) months.     (d)   “FAIR MARKET VALUE” per share as of a particular date
shall mean (i) the closing sales price per share of Common Stock as reported on
the NASDAQ market system (or if the shares of Common Stock are not then traded
on such system, on the principal national securities exchange on which they are
then traded) for the last preceding date on which there was a sale of such
Common Stock on such exchange, or (ii) if the shares of Common Stock are not
then traded on a national securities exchange but are traded on an
over-the-counter market, the average of the closing bid and asked prices for the
shares of Common Stock in such over-the-counter market for the last preceding
date on which there was a sale of such Common Stock in such market, or (iii) if
the shares of Common Stock are not then listed on a national securities exchange
or traded in an over-the-counter market, such value as the Committee in its
discretion may determine.     (e)   “GRANTEE” shall mean a person to whom an
Option or Restricted Stock Award has been granted.     (f)   “OPTION” shall mean
the right, granted to a Grantee pursuant to Section 3, to purchase a specified
number of shares of Common Stock, on the terms and subject to the restrictions
set forth in this Plan and by the Committee upon the grant of the Option to the
Grantee.     (g)   “RESTRICTED SHARE” shall mean a share of Common Stock,
awarded to a Grantee pursuant to Section 3, that is subject to the terms and
restrictions set forth in this Plan and by the Committee upon the award of the
Restricted Share to the Grantee.     (h)   “RETIREMENT” shall have such meaning
as the Committee shall determine from time to time.     (i)   “SUBSIDIARY
CORPORATION” shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the employer corporation if, at
the time of granting an Option or Restricted Stock Award, each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.

 

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

 

3   ADMINISTRATION       The Plan shall be administered by the
Compensation/Stock Option Committee (the “Committee”) of the Board of Directors
of the Corporation (the “Board”). The Committee shall consist of two or more
members of the Board, each of whom shall be both an “outside director” within
the meaning of Section 162(m) of the Code and a “nonemployee director” within
the meaning of Rule 16b-3, as from time to time amended (“Rule 16b-3”),
promulgated under Section 16 of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”).       The Committee shall have the authority in its
discretion, subject to and not inconsistent with the express provisions of the
Plan, to administer the Plan and to exercise all the powers and authorities
either specifically granted to it under the Plan or necessary or advisable in
the administration of the Plan, including, without limitation, the authority to
grant Options and make awards of Restricted Shares (“Restricted Stock Awards”
and sometimes collectively with the grant of Options, “Grants”); to determine
the purchase price of the shares of Common Stock covered by each Option (the
“Option Price”); to determine the persons to whom, and the time or times at
which, Options and Restricted Stock Awards shall be granted; to determine the
number of shares to be covered by each Option, and to determine the number of
Restricted Shares to be covered by each Restricted Stock Award; to interpret the
Plan; to prescribe, amend and rescind rules and regulations relating to the
Plan; to determine the terms and provisions of the agreements (which need not be
identical) entered into in connection with grants of Options (“Option
Agreements”) and Restricted Stock Awards (“Restricted Award Agreements”); and to
make all other determinations deemed necessary or advisable for the
administration of the Plan.       The determinations of the Committee shall be
binding and conclusive on all parties. The Committee may delegate to one or more
of its members or to one or more agents such administrative duties as it may
deem advisable, and the Committee or any person to whom it has delegated duties
as aforesaid may employ one or more persons to render advice with respect to any
responsibility the Committee or such person may have under the Plan. The
Committee shall have the authority in its discretion to delegate to specified
officers of the Corporation the power to make Grants, including to determine the
terms of such Grants, and the power to extend the exercisability of Options
pursuant to Section 6(f) or 6(g) hereof, in each case consistent with the terms
of this Plan and subject to such restrictions, if any, as the Committee may
specify when making such delegation; provided that the delegates shall not have
authority to make Grants to, or extend the exercisability of Options held by,
such delegates or any Executive Officer (as defined below in this Section 3).  
    The Board shall fill all vacancies, however caused, in the Committee. The
Board may from time to time appoint additional members to the Committee, and may
at any time remove one or more Committee members and substitute others. One
member of the Committee shall be selected by the Board as chairman. The
Committee shall hold its meetings at

 

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

 

    such times and places as it shall deem advisable. All determinations of the
Committee shall be made by a majority of its members either present in person or
participating by conference telephone at any meeting or by written consent,
except that, with respect to Grantees who are executive officers of the
Corporation within the meaning of Rule 3b-7 promulgated under Section 3 of the
Exchange Act (“Executive Officers”), all action of the Committee shall be taken
solely by those members of the Committee who are “outside directors” and
“nonemployee directors” as defined above, even if less than a majority of the
Committee. The Committee may appoint a secretary and make such rules and
regulations for the conduct of its business as it shall deem advisable, and
shall keep minutes of its meetings.       No member of the Board or Committee
shall be liable for any action taken or determination made in good faith with
respect to the Plan or any Grant made hereunder.   4   ELIGIBILITY       Options
and Restricted Stock Awards may be granted to employees (including, without
limitation, officers who are employees) of the Corporation or its present or
future divisions and Subsidiary Corporations, and to directors (whether or not
employees) of the Corporation or its present or future divisions and Subsidiary
Corporations. In determining the persons to whom Options and Restricted Stock
Awards shall be granted and the number of shares to be covered by each Option,
and the number of Restricted Shares to be covered by each Restricted Stock
Award, the Committee shall take into account the duties of the respective
persons, their present and potential contributions to the success of the
Corporation and such other factors as the Committee shall deem relevant in
connection with accomplishing the purpose of the Plan. A person to whom an
Option has been granted hereunder is sometimes referred to herein as an
“Optionee”.       A Grantee shall be eligible to receive more than one Grant
during the term of the Plan, but only on the terms and subject to the
restrictions hereinafter set forth.   5   STOCK       The shares of Common Stock
subject to Options and Restricted Stock Awards hereunder shall be shares of the
Corporation that are authorized but unissued. The aggregate number of shares of
Common Stock as to which Grants may be made from time to time under this Plan
shall not exceed 600,000; provided, however, the number of Restricted Shares
shall not exceed 50% of the authorized number of shares set forth in this
sentence.       If any shares subject to an Option Grant or Restricted Stock
Award are forfeited, canceled, exchanged or surrendered or if a Grant otherwise
terminates or expires without a distribution of shares to the Grantee, the
shares of Common Stock with respect to such Grant shall, to the extent of any
such forfeiture, cancellation, exchange, surrender, termination or expiration,
again be available for Grants under the Plan.

 

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

 

6   TERMS AND CONDITIONS OF OPTIONS       Each Option granted pursuant to the
Plan shall be evidenced by a written Option Agreement between the Corporation
and the Optionee, which agreement shall comply with and be subject to the
following terms and conditions (and with such other terms and conditions not
inconsistent with the terms of this Plan as the Committee, in its discretion,
shall establish):

  (a)   NUMBER OF SHARES. Each Option Agreement shall state the number of shares
of Common Stock to which the Option relates.     (b)   Each Option Agreement
shall specifically state that no portion of the Option constitutes an Incentive
Stock Option and the entire Option constitutes a Nonqualified Stock Option.    
(c)   OPTION PRICE. Each Option Agreement shall state the Option Price, which
shall be not less than one hundred percent (100%) of the Fair Market Value of
the shares of Common Stock of the Corporation on the date of grant of the
Option. The Option Price shall be subject to adjustment as provided in Section
6(i) hereof. The date on which the Committee adopts a resolution expressly
granting an Option shall be considered the day on which such Option is granted,
unless such resolution expressly provides for a specific later date.     (d)  
MEDIUM AND TIME OF PAYMENT. The Option Price shall be paid in full, at the time
of exercise, (i) in cash, (ii) in shares of Common Stock having a Fair Market
Value equal to such Option Price provided that such shares have been held by the
Grantee for at least six (6) months prior to such exercise, (iii) by promissory
note adequately secured in the discretion of the Committee, or (iv) in a
combination of the foregoing, or (v) in the sole discretion of the Committee,
through a cashless exercise procedure involving a broker; provided, however,
that such method and time for payment shall be permitted by and be in compliance
with applicable law.     (e)   TERM AND EXERCISE OF OPTIONS. Except as provided
in Section 6(i) hereof or unless otherwise determined by the Committee, the
shares covered by an Option shall become exercisable over such period, in
cumulative installments or otherwise, or upon the satisfaction of such
performance goals or other conditions, as the Committee shall determine;
provided, however, that the Committee shall have the authority to accelerate the
exercisability of all or any portion of any outstanding Option at such time and
under such circumstances as it, in its sole discretion, deems appropriate, and
provided further, however, that such exercise period shall not exceed ten
(10) years from the date of grant of such Option. The exercise period shall be
subject to earlier termination as provided in Sections 6(f) and 6(g) hereof. An
Option may be exercised, as to any or all full shares of Common Stock as to
which the Option has become exercisable, by giving written notice of such
exercise to the Committee; provided, however, that an

 

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

 

Option may not be exercised at any one time as to fewer than 100 shares (or such
number of shares as to which the Option is then exercisable if such number of
shares is less than 100).

  (f)   Except as provided in this Section 6(f) and in Section 6(g) hereof, an
Option may not be exercised unless the Optionee is then in the employ or service
of the Corporation or one of its divisions or Subsidiary Corporations, and
unless the Optionee has remained continuously so employed or in service since
the date of grant of the Option. In the event that the employment or service of
an Optionee shall terminate or cease other than by reason of death, Disability
or Retirement, all Options theretofore granted to such Optionee shall, to the
extent not theretofore exercised or canceled, terminate three months after such
separation of employment or cessation of service, as applicable, but in any
event not beyond the date on which the Option would otherwise expire pursuant to
Section 6(e) hereof; provided, however, that the Committee may in its discretion
at the time of the grant of an Option reduce the period for exercise of Options
that were exercisable at the time of separation of employment or cessation of
service to the date of such separation or cessation date. Nothing in the Plan or
in any Option granted pursuant hereto shall confer upon an individual any right
to continue in the employ or service of the Corporation or any of its divisions
or Subsidiary Corporations or interfere in any way with the right of the
Corporation or any such division or Subsidiary Corporation to terminate such
employment. Notwithstanding anything in the Plan to the contrary, in the event
that the employment or service of an Optionee shall terminate or cease for
Cause, all Options theretofore granted to such Optionee shall, to the extent not
theretofore exercised or canceled, terminate immediately.     (g)   DEATH,
DISABILITY OR RETIREMENT OF OPTIONEE. If an Optionee shall die while employed by
or in service to the Corporation or a Subsidiary Corporation, or if the
Optionee’s employment or service shall terminate or cease by reason of
Disability or Retirement, all Options theretofore granted to such Optionee, to
the extent exercisable on the date of death or separation, may be exercised by
the Optionee or by the Optionee’s estate or by a person who acquired the right
to exercise such Option by bequest or inheritance or otherwise by reason of the
death or Disability of the Optionee, at any time within three (3) months (in the
case of Retirement), twelve (12) months (in the case of Disability), or two
(2) years (in the case of death) after the date of death or termination by
reason of Disability or Retirement, or at such later time as the Committee may
in its discretion determine, but in any event not beyond the date on which the
Option would otherwise expire pursuant to Section 6(e) hereof.

 

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

 

  (h)   NONTRANSFERABILITY OF OPTIONS. Options granted under the Plan shall not
be transferable except (i) by will or the laws of descent and distribution, or
(ii) as specifically provided below in this Section (6)(h). Any Optionee may
transfer Non-statutory Stock Options to members of his or her Immediate Family
(as defined below) if (x) the option agreement pursuant to which the Option was
granted so provides, (y) such agreement was approved by the Board or the
Committee, and (z) the Optionee does not receive any consideration for the
transfer. “Immediate Family” means children, grandchildren, and spouse of the
Optionee or one or more trusts for the benefit of such family members or
partnerships in which such family members are the only partners. Any
Nonstatutory Stock Option agreement may be amended to provided for the
transferability feature as outlined above, provided that such amendment is
approved by the Board or the Committee. Any Option not granted pursuant to an
option agreement expressly permitting its transfer shall not be transferable.
During the lifetime of the Optionee, Options may be exercised only by the
Optionee, the guardian or legal representative of the Optionee, or the
transferee as permitted under this Section 6(h).     (i)   EFFECT OF CERTAIN
CHANGES. (1) If there is any change in the shares of Common Stock through the
declaration of stock dividends, distributions made with respect to shares of
Common Stock, recapitalizations, restructurings, stock splits, or combinations
or exchanges of such shares, or the like, then the number of shares of Common
Stock or other securities available for Options, the kind and amount of shares
and other securities covered by outstanding Options, and/or the Option Price, as
appropriate, shall be adjusted as necessary to reflect equitably such change in
the shares of Common Stock; provided, however, that any fractional shares
resulting from such adjustment shall be eliminated. (2) In the event of
dissolution or liquidation of the Corporation, or any merger, consolidation,
acquisition of property or stock, separation or reorganization in which the
Corporation is not the surviving entity, each outstanding Option shall
terminate, unless the surviving entity assumes the outstanding Options or
replaces them with new options of comparable value in accordance with the
provisions of Section 424(a) of the Code; provided, however, that should the
surviving entity not assume or replace the outstanding Options under the Plan,
each Optionee shall have the right, immediately prior to such dissolution,
liquidation, merger, consolidation, acquisition of property or stock, separation
or reorganization, to exercise his or her outstanding Option in full, without
regard to any installment exercise provisions, to the extent it shall not have
been exercised. (3) In the event of a change in the Common Stock of the
Corporation as presently constituted which is limited to a change of all of its
authorized shares with par value into the same number of shares with a different
par value or without par value, the shares resulting from any such change shall
be deemed to be the Common Stock within the meaning of the Plan. (4) The
foregoing adjustments shall be made by the Committee, whose determination in
that respect shall be final, binding and conclusive. (5) Except as hereinbefore
expressly provided in this Section 6(i), the

 

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

 

      Optionee shall have no rights by reason of any subdivision or
consolidation of shares of stock of any class or the payment of any stock
dividend or any other increase or decrease in the number of shares of stock of
any class or by reason of any dissolution, liquidation, merger, or consolidation
or spin-off of assets or stock of another corporation; and any issue by the
Corporation of shares of stock of any class, or securities convertible into
shares of stock of any class, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common
Stock subject to the Option. The grant of an Option pursuant to the Plan shall
not affect in any way the right or power of the Corporation to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structures or to merge or to consolidate or to dissolve, liquidate or sell, or
transfer all or part of its business or assets.           (j)   RIGHTS AS A
STOCKHOLDER. An Optionee or a transferee of an Option shall have no rights as a
stockholder with respect to any shares covered by the Option until the date of
the issuance of a stock certificate for such shares. No adjustment shall be made
for dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distribution of other rights for which the record date is prior to
the date such stock certificate is issued, except as provided in Section 6(i)
hereof.     (k)   OTHER PROVISIONS. The Option Agreements authorized under the
Plan may contain such other provisions, including without limitation the
imposition of (1) restrictions upon the exercise of an Option and (2) provisions
that will result in the forfeiture of an Option and/or the shares acquired
thereunder in the event the Optionee breaches covenants relating to
non-competition, confidentiality and non-solicitation of employees and
customers, as the Committee shall deem advisable.     (l)   NO REPRICING OF
OPTIONS. After the grant of an option the exercise price may not be reduced, no
action may be taken by the Committee that would be treated as repricing under
generally accepted accounting principles and there shall be no cancellation of
an option when the exercise price exceeds fair market value in exchange for
another option, restricted stock or other equity, unless in connection with a
merger, acquisition, spinoff or other similar transaction.

 

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

 

7   TERMS AND CONDITIONS OF RESTRICTED STOCK AWARDS       Each Restricted Stock
Award granted under the Plan shall be evidenced by a written Restricted Award
Agreement between the Corporation and the Grantee, which agreement shall comply
with, and be subject to, the following terms and conditions (and with such other
terms and conditions not inconsistent with the terms of this Plan as the
Committee, in its discretion, shall establish):

  (a)   NUMBER OF SHARES AND UNITS. The Committee shall determine the number of
Restricted Shares to be awarded to a Grantee pursuant to the Restricted Stock
Award.     (b)   NONTRANSFERABILITY. Except as set forth in subsections (f) and
(g) of this Section 7, a Grantee may not sell, assign, transfer, pledge,
hypothecate or otherwise dispose of any Restricted Shares awarded to said
Grantee under this Plan, or any interest therein, except by will or the laws of
descent and distribution, until the Restricted Period (as defined below) shall
have elapsed. The Committee may also in its discretion impose such other
restrictions and conditions on Restricted Shares awarded as it deems appropriate
including without limitation, the imposition of provisions that will result in
the forfeiture of Restricted Shares in the event the Grantee breaches covenants
relating to non-competition, confidentiality and non-solicitation of employees
and customers. In determining the Restricted Period of an award, the Committee
may provide that the restrictions shall lapse with respect to specified
percentages of the awarded shares on successive anniversaries of the date of
such award or upon the satisfaction of such other conditions as the Committee
may impose. In no event shall the Restricted Period end with respect to a
Restricted Stock Award prior to the satisfaction by the Grantee of any liability
arising under Section 8 hereof. Any attempt to dispose of any Restricted Shares
in contravention of any such restrictions shall be null and void and without
effect. The period during which such restrictions on transfer, and such other
restrictions as the Committee may impose, are in effect is referred to as the
“Restricted Period”.     (c)   CERTIFICATES REPRESENTING RESTRICTED SHARES. The
Corporation shall not be required to issue stock certificates representing
Restricted Shares awarded to a Grantee until the Restricted Period related to
such shares has lapsed. If any stock certificates representing Restricted Shares
awarded pursuant to a Restricted Stock Award are issued prior to the lapse of
the Restricted Period, such stock certificate shall bear an appropriate legend
referring to such restrictions. Such certificates may be retained by the
Corporation during the Restricted Period.

 

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

 

  (d)   TERMINATION. If the Grantee’s continuous employment or service with the
Corporation or any of its divisions or Subsidiary Corporations shall terminate
for any reason prior to the expiration of the Restricted Period applicable to
any Restricted Shares granted to such Grantee, or prior to the satisfaction of
any other conditions established by the Committee applicable to such Grant, any
such Restricted Shares then remaining subject to restrictions (after taking into
account the provisions of subsections (f) and (g) of this Section 7) shall
thereupon be forfeited by the Grantee and any such Restricted Shares shall be
transferred to, and reacquired by, the Corporation or its Subsidiary Corporation
at no cost to the Corporation or the Subsidiary Corporation. In such event, the
Grantee, or in the event of his death, his personal representative, shall, with
respect to any such shares, forthwith deliver to the Secretary of the
Corporation any stock certificates in the possession of the Grantee or the
Grantee’s representative representing the Restricted Shares remaining subject to
such restrictions, accompanied by such instruments of transfer, if any, as may
reasonably be required by the Secretary of the Corporation.     (e)   RIGHTS AS
A STOCKHOLDER. Upon receipt by a Grantee of a Restricted Stock Award, the
Grantee shall possess all incidents of ownership of the Restricted Shares
(subject to subsection (b) of this Section 7), including the right to receive or
reinvest dividends with respect to such shares and to vote such shares.     (f)
  EFFECT OF CERTAIN CHANGES. The number of Restricted Shares subject to a Grant
shall be appropriately adjusted by the Committee in the event of any change in
the shares of Common Stock set forth in Section 6(i)(1). Upon the occurrence of
an Acceleration Event, as defined in Section 6(i)(2), all restrictions then
outstanding with respect to a Restricted Stock Award shall automatically expire
and be of no further force and effect.     (g)   OTHER PROVISIONS. The Committee
shall have the authority (and the Restricted Award Agreement may so provide) to
cancel all or any portion of any outstanding restrictions and conditions prior
to the expiration of the Restricted Period with respect to all or part of a
Restricted Stock Award on such terms and conditions as the Committee may deem
appropriate. The Restricted Award Agreements authorized under this Plan shall
contain such other provisions not inconsistent with the terms hereof as the
Committee shall deem advisable.

 

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

 

8   WITHHOLDING TAXES       When a Grantee or other person becomes entitled to
receive shares of Common Stock pursuant to the exercise of an Option or upon the
lapse of restrictions relating to a Restricted Stock Award the Corporation shall
have the right to require the Grantee or such other person to remit to the
Corporation an amount sufficient to satisfy any federal, state and local
withholding tax requirements related thereto. Unless otherwise prohibited by the
Committee or by applicable law, satisfaction of the withholding tax obligation
may be accomplished by any of the following methods or by a combination of such
methods: (a) tendering a cash payment, (b) authorizing the Company to withhold
from the shares of Common Stock or cash otherwise payable (1) one or more of
such shares having an aggregate Fair Market Value, determined as of the date the
withholding tax obligation arises, less than or equal to the amount of the total
withholding tax obligation or (2) cash in an amount less than or equal to the
amount of the total withholding tax obligation and (c) delivering to the Company
shares of Common Stock (provided that such shares shall have been held for at
least six (6) months) having an aggregate Fair Market Value, determined as of
the date the withholding tax obligation arises, less than or equal to the amount
of the total withholding tax obligation.   9   TERM OF PLAN       Unless
terminated earlier by the Board, the term of this Plan shall be ten (10) years
from the date the Plan was adopted. No Option or Restricted Stock Award shall be
granted pursuant to this Plan later than August 16, 2015, but Options and
Restricted Stock and Unit Awards theretofore granted may extend beyond that date
in accordance with their terms.   10   AMENDMENT AND TERMINATION OF THE PLAN    
  The Board may, at any time and from time to time, suspend, terminate, modify
or amend the Plan. Except as provided in Section 6 hereof, no suspension,
termination, modification or amendment of the Plan may adversely affect any
Grant previously made, unless the written consent of the Grantee is obtained.  
11   EFFECTIVE DATE       The Plan shall take effect on August 16, 2005, the
date of its adoption by the Board of Directors.

 

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

 

12   MISCELLANEOUS

  (a)   Effect of Headings. The section and subsection headings contained herein
are for convenience only and shall not affect the construction hereof.     (b)  
Compliance with Legal Requirements. The Plan and the other obligations of the
Corporation under the Plan and any agreement shall be subject to all applicable
federal and state laws, rules and regulations, and to such approvals by any
regulatory or governmental agency as may be required. The Corporation, in its
discretion, may postpone the issuance or delivery of Common Stock under any
Grant as the Corporation may consider appropriate, and may require any Grantee
to make such representations and furnish such information as it may consider
appropriate in connection with the issuance or delivery of Common Stock in
compliance with applicable laws, rules and regulations.     (c)   No Right To
Continued Employment. Nothing in the Plan or in any agreement entered into
pursuant hereto shall confer upon any Grantee the right to continue in the
employ or service of the Corporation or any of its divisions or Subsidiary
Corporations, to be entitled to any remuneration or benefits not set forth in
the Plan or such agreement or to interfere with or limit in any way the right of
the Corporation or such division or Subsidiary Corporation to terminate such
Grantee’s employment.     (d)   No Grantee shall have any claim to be made any
Grant under the Plan, and there is no obligation for uniformity of treatment for
Grantees. Except as provided specifically herein, a Grantee or a transferee of a
Grant shall have no rights as a stockholder with respect to any shares covered
by any Grant until the date of the issuance of a stock certificate for such
shares.     (e)   Beneficiary. A Grantee may file with the Committee a written
designation of a beneficiary on such form as may be prescribed by the Committee
and may, from time to time, amend or revoke such designation. If no designated
beneficiary survives the Grantee, the executor or administrator of the Grantee’s
estate shall be deemed to be the Grantee’s beneficiary.

13   GOVERNING LAW       The Plan shall be construed and administered in
accordance with the laws of the State of Delaware without regard to its
principles of conflicts of law.