Exhibit 10.2

 

 

 
AMENDED AND RESTATED
AKORN, INC. 2003 STOCK OPTION PLAN
 

 
(Amended Effective December 29, 2011)
 

 

 

 

 

 

 

 

 

 

 

 

 

 
 
 

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TABLE OF CONTENTS
 

 

 
Page
       
ARTICLE 1 PURPOSE OF THE PLAN
1
   
ARTICLE 2 DEFINITIONS
1
2.1
Administrator
1
2.2
Affiliate
1
2.3
Applicable Laws
1
2.4
Award
1
2.5
Award Agreement
1
2.6
Awarded Stock
2
2.7
Beneficially Owned and Beneficial Ownership
2
2.8
Board
2
2.9
Change in Control
2
2.10
Code
3
2.11
Committee
3
2.12
Common Stock
3
2.13
Consultant
3
2.14
Corporation
3
2.15
Director
3
2.16
Disability
3
2.17
Effective Date
3
2.18
Employee
3
2.19
Exchange Act
3
2.20
Exchange Program
4
2.21
Fair Market Value
4
2.22
Fiscal Year
4
2.23
Incentive Stock Option
4
2.24
Non-Qualified Stock Option
4
2.25
Officer
4
2.26
Option
4
2.27
Other Stock Based Awards
4
2.28
Outside Director
4
2.29
Participant
4
2.30
Performance Share
4
2.31
Performance Unit
4
2.32
Period of Restriction
4
2.33
Plan
4
2.34
Prior Plan
4
2.35
Restricted Stock
5
2.36
Restricted Stock Unit
5
2.37
Rule 16b-3
5
2.38
Section 16(b)
5
2.39
Service Provider
5
2.40
Share
5
2.41
Stock Appreciation Right or SAR
5

 
 
 
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2.42
Unrestricted Stock
5
     
ARTICLE 3 PLAN ADMINISTRATION
5
3.1
Procedure.
5
3.2
Powers of the Administrator
6
3.3
Effect of Administrator’s Decision
7
     
ARTICLE 4 STOCK SUBJECT TO THE PLAN
7
4.1
Stock Subject to the Plan
7
4.2
Lapsed Awards
7
4.3
Adjustments for Changes in Capitalization and Similar Events
8
4.4
Substitute Awards
8
     
ARTICLE 5 PARTICIPATION
9
5.1
Eligibility
9
5.2
Termination of Participation
9
     
ARTICLE 6 STOCK OPTIONS
9
6.1
Option Grant
9
6.2
Exercise Price
10
6.3
Waiting Period and Exercise Dates
10
6.4
Exercise of Option.
10
6.5
Form of Consideration
11
6.6
Promissory Note
12
     
ARTICLE 7 RESTRICTED STOCK
12
7.1
Grant of Restricted Stock
12
7.2
Restricted Stock Agreement
12
7.3
Transferability
12
7.4
Other Restrictions
13
7.5
Removal of Restrictions
13
7.6
Voting Rights
13
7.7
Dividends and Other Distributions
13
7.8
Return of Restricted Stock to Corporation
13
     
ARTICLE 8 UNRESTRICTED STOCK
13
   
ARTICLE 9 STOCK APPRECIATION RIGHTS
13
9.1
Grant of SARs
13
9.2
Number of Shares
13
9.3
Exercise Price and Other Terms
13
9.4
SAR Agreement
13
9.5
Expiration of SARs
14
9.6
Payment of SAR Amount
14
9.7
Buyout Provisions
14
     
ARTICLE 10 PERFORMANCE UNITS AND PERFORMANCE SHARES
14
10.1
Grant of Performance Units/Shares
14
10.2
Value of Performance Units/Shares
14
10.3
Performance Objectives and Other Terms
14

 
 
 
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10.4
Earning of Performance Units/Shares
14
10.5
Form and Timing for Payment of Performance Units/Shares
14
10.6
Cancellation of Performance Units/Shares
15
     
ARTICLE 11 RESTRICTED STOCK UNITS
15
   
ARTICLE 12 OTHER STOCK BASED AWARDS
15
   
ARTICLE 13 DISSOLUTION OR LIQUIDATION; OR CHANGE IN CONTROL
15
13.1
Dissolution or Liquidation
15
13.2
Change in Control.
16
     
ARTICLE 14 MISCELLANEOUS PROVISIONS
17
14.1
No Uniform Rights to Awards
17
14.2
Share Certificates
17
14.3
No Rights as a Service Provider
17
14.4
No Rights as Shareholder
17
14.5
No Trust or Fund Created
17
14.6
No Fractional Shares
18
14.7
Requirement of Consent and Notification of Election Under Code § 83(b) or
Similar Provision
18
14.8
Requirement of Notification Upon Disqualifying Disposition Under Code § 421(b)
18
14.9
Leaves of Absence
18
14.10
Notices
18
14.11
Non-Transferability of Awards
18
14.12
Date of Grant
19
14.13
Amendment and Termination of Plan.
19
14.14
Conditions Upon Issuance of Shares.
19
14.15
Severability
19
14.16
Inability to Obtain Authority
19
14.17
Shareholder Approval
20
14.18
Governing Law
20

 

 
 
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AMENDED AND RESTATED
AKORN, INC. 2003 STOCK OPTION PLAN
 
ARTICLE 1
PURPOSE OF THE PLAN
 
The purpose of this Amended and Restated Akorn, Inc. 2003 Stock Option Plan is
to promote the interests of Akorn, Inc. and its shareholders by: (i) attracting
and retaining exceptional Directors, Employees and Consultants (including
prospective Directors, Employees and Consultants) of the Corporation, and
(ii) enabling such individuals to participate in the long-term growth and
financial success of the Corporation.
 
Accordingly, the Plan provides for the granting of Incentive Stock Options,
Non-Qualified Stock Options, Restricted Stock Awards, Unrestricted Stock Awards,
Restricted Stock Units, Stock Appreciation Rights, Performance Unit Awards,
Performance Share Awards, and Other Stock Based Awards.
 
ARTICLE 2
DEFINITIONS
 
2.1           “Administrator” means the Board, the Committee, or any Officer or
Employee of the Corporation to whom the Board or the Committee has delegated
authority to administer the Plan.
 
2.2           “Affiliate” means a “parent” or “subsidiary” corporation as
defined in Code §§ 424(e) and (f), or that the Board has designated as
participating in the Plan.
 
2.3           “Applicable Laws” means the requirements relating to the
administration of equity-based awards or equity compensation plans under U.S.
federal and state laws, the Code, any stock exchange or quotation system on
which the Common Stock is listed or quoted, and the applicable laws of any
foreign country or jurisdiction where Awards are, or will be, granted under the
Plan.
 
2.4           “Award” means, individually or collectively, a grant under the
Plan of Incentive Stock Options, Non-Qualified Stock Options, Restricted Stock
Awards, Unrestricted Stock Awards, Restricted Stock Units, Stock Appreciation
Rights, Performance Unit Awards, Performance Share Awards or Other Stock Based
Awards.
 
2.5           “Award Agreement” means the written or electronic agreement
setting forth the terms and provisions applicable to each Award granted under
the Plan. The Award Agreement is subject to the terms and conditions of the
Plan.
 
2.6           “Awarded Stock” means the Common Stock subject to an Award.
 
2.7           “Beneficially Owned” and “Beneficial Ownership” means as set forth
in Rule 13d-3 of the Exchange Act, provided that the exercise of voting rights
by a nominee or proxy holder of the Board in connection with a meeting or
proposed action by shareholders of the Corporation shall not be deemed to
constitute such ownership and any ownership or voting power of the trustee under
an employee benefit plan of the Corporation shall not be deemed to constitute
such ownership.
 
2.8           “Board” means the Board of Directors of the Corporation.
 
 
 
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2.9           “Change in Control” means, unless otherwise defined under Code
§ 409A and reflected in the Award Agreement, the occurrence of any of the
following events:
 
(a)           the shareholders of the Corporation approve a merger or
consolidation of the Corporation with any other entity such that after the
transaction more than 50% of the outstanding “Voting Securities” (defined as
securities the holders of which are entitled to vote for the election of
Directors) of the surviving entity would be Beneficially Owned by “Persons” (as
such term is used in §§ 13(d) and 14(d) of the Exchange Act) who did not
Beneficially Own “Voting Securities” of the Corporation prior to the
transaction;
 
(b)           Directors who were members of the Board immediately prior to a
meeting of the shareholders of the Corporation which meeting involves a contest
for the election of at least one directorship, do not constitute at least a
majority of the Directors following such meeting or election;
 
(c)           an acquisition, directly or indirectly, of more than 50% of the
outstanding shares of any class of “Voting Securities” of the Corporation by any
“Person;”
 
(d)           the shareholders of the Corporation approve a sale of all or
substantially all of the assets of the Corporation or the liquidation of the
Corporation; OR
 
(e)           there is a change, during any period of two consecutive years or
less of a majority of the Board as constituted as of the beginning of such
period, unless the election of each Director who is not a Director at the
beginning of such period was approved by a vote of at least two-thirds of the
Directors then in office who were Directors at the beginning of the period.
 
Notwithstanding the foregoing, a Change in Control shall not be deemed to have
occurred in the event the Corporation forms a holding company as a result of
which the holders of the Corporation’s “Voting Securities” immediately prior to
the transaction, hold, in approximately the same relative proportions as they
held prior to the transaction, substantially all of the “Voting Securities” of a
holding company owning all of the Corporation’s “Voting Securities” after the
completion of the transaction.
 
2.10           “Code” means the Internal Revenue Code of 1986, as amended, and
the Treasury regulations promulgated thereunder.  Any reference to a section of
the Code herein will be a reference to any successor or amended section of the
Code.
 
2.11           “Committee” means a committee of Directors or other individuals
satisfying Applicable Laws and appointed by the Board in accordance with
Article 3 of the Plan.  If the Committee is comprised of two Directors, both
Directors shall be “non-employee directors” as that term is defined in Rule
16b-3.
 
2.12           “Common Stock” means the Common Stock of the Corporation, or in
the case of Awards not based on Shares, the cash equivalent thereof.
 
2.13           “Consultant” means any person, including an advisor, engaged by
the Corporation or an Affiliate to render services to such entity.
 
2.14           “Corporation” means Akorn, Inc., a Louisiana corporation.
 
 
 
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2.15           “Director” means a member of the Board.
 
2.16           “Disability” means, unless otherwise defined under Code § 409A
and reflected in the Award Agreement, total and permanent disability as defined
in Code § 22(e)(3), provided that in the case of Awards other than Incentive
Stock Options, the Administrator in its discretion may determine whether a
permanent and total disability exists in accordance with uniform and
non-discriminatory standards adopted by the Administrator from time to time.
 
2.17           “Effective Date” means, as amended and restated, as of April 1,
2005, provided that the Plan as amended and restated is approved by the
shareholders of the Corporation on or within 12 months of such date.  The Plan
was originally made effective as of November 6, 2003.
 
2.18           “Employee” means any person, including Officers and Directors,
employed by the Corporation or an Affiliate.  Neither service as a Director nor
payment of a director’s fee by the Corporation will be sufficient to constitute
“employment” by the Corporation.
 
2.19           “Exchange Act” means the Securities Exchange Act of 1934, as
amended.
 
2.20           “Exchange Program” means a program under which (i) outstanding
Awards are surrendered or cancelled in exchange for Awards of the same type
(which may have lower exercise prices and different terms), Awards of a
different type, and/or cash; or (ii) the exercise price of an outstanding Award
is reduced.  The terms and conditions of any Exchange Program will be determined
by the Administrator in its sole discretion.
 
2.21           “Fair Market Value” means, as of any date and unless the
Administrator determines otherwise, the value of Common Stock determined as
follows:
 
(a)           If the Common Stock is listed on any established stock exchange or
a national market system, including without limitation the American Stock
Exchange, the NASDAQ National Market or the NASDAQ SmallCap Market of the NASDAQ
Stock Market, its Fair Market Value will be the closing sales price for such
stock (or the closing bid, if no sales were reported) as quoted on such exchange
or system for the day of determination, as reported in The Wall Street Journal
or such other source as the Administrator deems reliable;
 
(b)           If the Common Stock is regularly quoted by a recognized securities
dealer but selling prices are not reported, the Fair Market Value of a Share of
Common Stock will be the mean between the high bid and low asked prices for the
Common Stock for the day of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems reliable; or
 
(c)           In the absence of an established market for the Common Stock, the
Fair Market Value will be determined in good faith by the Administrator.
 
Notwithstanding the preceding, for federal, state, and local income tax
reporting purposes and for such other purposes as the Administrator deems
appropriate, the Fair Market Value shall be determined by the Administrator in
accordance with uniform and nondiscriminatory standards adopted by it from time
to time.
 
2.22           “Fiscal Year” means the fiscal year of the Corporation.
 
 
 
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2.23           “Incentive Stock Option” means an Option intended to qualify as
an incentive stock option within the meaning of Code § 422 and the Treasury
regulations promulgated thereunder.
 
2.24           “Non-Qualified Stock Option” means an Option that by its terms
does not qualify or is not intended to qualify as an Incentive Stock Option.
 
2.25           “Officer” means a person who is an officer of the Corporation
within the meaning of § 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
 
2.26           “Option” means an Incentive Stock Option or a Non-Qualified Stock
Option or both, as the context requires.
 
2.27           “Other Stock Based Awards” means any other awards not
specifically described in the Plan that are valued in whole or in part by
reference to, or are otherwise based on, Shares and are created by the
Administrator pursuant to Article 12.
 
2.28           “Outside Director” means a Director who either: (i) is not a
current Employee of the Corporation or an “affiliated corporation” (within the
meaning of the Treasury regulations promulgated under Code § 162(m)), is not a
former employee of the Corporation or an “affiliated corporation” receiving
compensation for prior services (other than benefits under a tax qualified
retirement plan), was not an officer of the Corporation or an “affiliated
corporation” at any time, and is not currently receiving direct or indirect
remuneration (within the meaning of the Treasury regulations promulgated under
Code § 162(m)) from the Corporation or an “affiliated corporation” for services
in any capacity other than as a Director; or (ii) is otherwise considered an
“outside director” for purposes of Code § 162(m).
 
2.29           “Participant” means the holder of an outstanding Award granted
under the Plan.
 
2.30           “Performance Share” means, pursuant to Article 10, an Award
granted to a Service Provider under which, upon the satisfaction of
predetermined individual or Corporation performance goals and/or objectives,
shares of Common Stock are paid to the Participant.
 
2.31           “Performance Unit” means, pursuant to Article 10, an Award
granted to a Service Provider under which, upon the satisfaction of
predetermined individual or Corporation performance goals and/or objectives, a
cash payment shall be paid to the Participant based on the number of “units”
awarded to the Participant.  For this purpose, the term “unit” means bookkeeping
units, each of which represents such monetary amount as shall be designated by
the Administrator in each Award Agreement.
 
2.32           “Period of Restriction” means the period during which the
transfer of Shares of Restricted Stock are subject to restrictions.  Such
restrictions may be based on the passage of time, the achievement of target
levels of performance, or the occurrence of other events as determined by the
Administrator.
 
2.33           “Plan” means this Amended and Restated Akorn, Inc. 2003 Stock
Option Plan, as amended from time to time.  The Plan is an amendment and
restatement of the Prior Plan.  Any option awards previously made under the
Prior Plan shall continue in full force and effect under the terms of the Prior
Plan and shall not be changed nor modified by any terms of this Plan.
 
2.34           “Prior Plan” means the Akorn, Inc. 2003 Stock Option Plan.
 
 
 
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2.35           “Restricted Stock” means shares of Common Stock issued pursuant
to a Restricted Stock Award under the Plan or issued pursuant to the early
exercise of an Option.
 
2.36           “Restricted Stock Unit” means an Award that the Administrator
permits to be paid in installments or on a deferred basis, and that represents
an unfunded and unsecured promise to deliver Shares, cash, other securities,
other Awards or other property in accordance with the terms of the applicable
Award Agreement.
 
2.37           “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
 
2.38           “Section 16(b)” means Section 16(b) of the Exchange Act.
 
2.39           “Service Provider” means an Employee, Director or Consultant.
 
2.40           “Share” means a share of the Common Stock, as adjusted in
accordance with Section 4.3 and Article 13 of the Plan.
 
2.41           “Stock Appreciation Right” or “SAR” means an Award that is
designated as a SAR, and represents an unfunded and unsecured promise to deliver
Shares, cash, other securities, other Awards or other property equal in value to
the excess, if any, of the Fair Market Value per Share over the exercise price
per Share of the SAR, subject to the terms of the applicable Award Agreement.
 
2.42           “Unrestricted Stock” means as defined in Article 8 of the Plan.
 
ARTICLE 3
PLAN ADMINISTRATION
 
3.1           Procedure.
 
(a)           Board’s Delegation.  The Board may delegate administration of the
Plan to a Committee(s).  If administration is delegated to a Committee, the
Committee shall have, in connection with the administration of the Plan, the
powers possessed by the Board, subject, however, to such resolutions, not
inconsistent with the provisions of this Plan, as may be adopted from time to
time by the Board.  The Board may abolish the Committee at any time and revest
in the Board the administration of the Plan.  Different Committees with respect
to different groups of Service Providers may administer the Plan.
 
(b)           Code § 162(m).  To the extent that the Administrator determines it
to be desirable and necessary to qualify Awards granted hereunder as
“performance-based compensation” within the meaning of Code § 162(m), the Plan
will be administered by a Committee of two or more Outside Directors.
 
(c)           Rule 16b-3.  To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
will be structured to satisfy the requirements for exemption under Rule 16b-3.
 
(d)           Other Administration.  Other than as provided above, the Plan will
be administered by: (i) the Board, or (ii) a Committee, which committee will be
constituted to satisfy Applicable Laws.
 
 
 
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(e)           Delegation of Authority for Day-to-Day Administration.  Except to
the extent prohibited by Applicable Law, the Administrator may delegate to one
or more individuals the day-to-day administration of the Plan and any of the
functions assigned to it in this Plan.  Such delegation may be revoked at any
time.
 
3.2           Powers of the Administrator.  Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator will have the authority, in
its discretion:
 
(a)           To determine the Fair Market Value.
 
(b)           To select the Service Providers to whom Awards may be granted
hereunder.
 
(c)           To determine the number of Shares to be covered by each Award
granted hereunder.
 
(d)           To approve forms of agreement for use under the Plan.
 
(e)           To determine the terms and conditions, not inconsistent with the
terms of the Plan, of any Award granted hereunder.  Such terms and conditions
include, but are not limited to, the exercise price, the time or times when
Awards may be exercised (which may be based on performance criteria), any
vesting acceleration or waiver of forfeiture or repurchase restrictions, and any
restriction or limitation regarding any Award or the Shares relating thereto,
based in each case on such factors as the Administrator will determine in its
sole discretion.
 
(f)           To reduce the exercise price of any Award to the then current Fair
Market Value if the Fair Market Value of the Common Stock covered by such Award
shall have declined since the date the Award was granted.
 
(g)          To institute an Exchange Program.
 
(h)          To construe and interpret the terms of the Plan and Awards granted
pursuant to the Plan, and to establish, amend and revoke rules and regulations
for its administration.
 
(i)           To prescribe, amend and rescind rules and regulations relating to
the Plan, including rules and regulations relating to sub-plans established for
the purpose of satisfying applicable foreign laws and/or qualifying for
preferred tax treatment under applicable foreign tax laws.
 
(j)           To modify or amend each Award (subject to Section 14.13(c) of the
Plan), including the discretionary authority to extend the post-termination
exercise period of Awards longer than is otherwise provided for in the Plan.
 
(k)          To allow Participants to satisfy withholding tax obligations by
electing to have the Corporation withhold from the Shares or cash to be issued
upon exercise or vesting of an Award that number of Shares or cash having a Fair
Market Value equal to the minimum amount required to be withheld.  The Fair
Market Value of any Shares to be withheld will be determined on the date that
the amount of tax to be withheld is to be determined.  All elections by a
Participant to have Shares or cash withheld for this purpose will be made in
such form and under such conditions as the Administrator may deem necessary or
advisable.
 
 
 
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(l)           To authorize any person to execute on behalf of the Corporation
any instrument required to affect the grant of an Award previously granted by
the Administrator.
 
(m)         To allow a Participant to defer the receipt of the payment of cash
or the delivery of Shares that would otherwise be due to such Participant under
an Award.
 
(n)          To determine whether Awards will be settled in Shares, cash or in
any combination thereof.
 
(o)          To create Other Stock Based Awards for issuance under the Plan.
 
(p)          To establish a program whereby Service Providers designated by the
Administrator can reduce compensation otherwise payable in cash in exchange for
Awards under the Plan.
 
(q)          To impose such restrictions, conditions or limitations as it
determines appropriate as to the timing and manner of any resales by a
Participant or other subsequent transfers by the Participant of any Shares
issued as a result of or under an Award, including without limitation,
(i) restrictions under an insider trading policy, and (ii) restrictions as to
the use of a specified brokerage firm for such resales or other transfers.  AND
 
(r)           To make all other determinations deemed necessary or advisable for
administering the Plan.
 
3.3           Effect of Administrator’s Decision.  The Administrator’s
decisions, determinations and interpretations will be final and binding on all
Participants and any other holders of Awards.
 
ARTICLE 4
STOCK SUBJECT TO THE PLAN
 
4.1           Stock Subject to the Plan.  Subject to the provisions of this
Article 4 and Article 13 of the Plan, the maximum aggregate number of Shares
that may be issued under the Plan is 19,000,000, of which the maximum number of
Shares that may be delivered pursuant to Incentive Stock Options granted under
the Plan shall be 300,000.  The Shares may be authorized and unissued, or
reacquired Common Stock.  Shares shall not be deemed to have been issued
pursuant to the Plan with respect to any portion of an Award that is paid in
cash.  Upon payment in Shares pursuant to the exercise of an Award, the number
of Shares available for issuance under the Plan shall be reduced only by the
number of Shares actually issued in such payment.  If a Participant pays the
exercise price (or purchase price, if applicable) of an Award through the tender
of Shares, or if Shares are tendered or withheld to satisfy any Corporation
withholding obligations, the number of Shares so tendered or withheld shall
again be available for issuance pursuant to future Awards under the Plan.
 
4.2           Lapsed Awards.  If any outstanding Award expires or is terminated
or canceled without having been exercised or settled in full, or if Shares
acquired pursuant to an Award subject to forfeiture or repurchase are forfeited
or repurchased by the Corporation, the Shares allocable to the terminated
portion of such Award or such forfeited or repurchased Shares shall again be
available for grant under the Plan.
 
 
 
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4.3           Adjustments for Changes in Capitalization and Similar Events.  In
the event the Administrator determines that any dividend or other distribution
(whether in the form of cash, Shares, other securities or other property),
recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase or exchange of Shares
or other securities of the Corporation, issuance of warrants or other rights to
purchase Shares or other securities of the Corporation, or other similar
corporate transaction or event affects the Shares such that an adjustment is
determined by the Administrator in its discretion to be appropriate or
desirable, then the Administrator shall:
 
(a)           in such manner as it may deem equitable or desirable, adjust any
or all of (i) the number of Shares or other securities of the Corporation (or
number and kind of other securities or property) with respect to which Awards
may be granted, including (1) the aggregate number of Shares that may be
delivered pursuant to Awards granted under the Plan, as provided in Section 4.1
of the Plan, and (2) the maximum number of Shares or other securities of the
Corporation (or number and kind of other securities or property) with respect to
which Awards may be granted to any Participant in any fiscal year of the
Corporation, and (ii) the terms of any outstanding Award, including (1) the
number of Shares or other securities of the Corporation (or number and kind of
other securities or property) subject to outstanding Awards or to which
outstanding Awards relate, and (2) the exercise price with respect to any Award;
OR
 
(b)           if deemed appropriate or desirable, make provision for a cash
payment to the holder of an outstanding Award in consideration for the
cancellation of such Award, including, in the case of an outstanding Option or
SAR, a cash payment to the holder of such Option or SAR in consideration for the
cancellation of such Option or SAR in an amount equal to the excess, if any, of
the Fair Market Value (as of a date specified by the Administrator) of the
Shares subject to such Option or SAR over the aggregate exercise price of such
Option or SAR (it being understood that, in such event, any Option or SAR having
a per Share exercise price equal to, or in excess of, the Fair Market Value of a
Share subject to such Option or SAR may be cancelled and terminated without any
payment or consideration therefore).
 
Any such adjustments shall be made by the Administrator in its absolute
discretion, and the decision of the Administrator shall be final, binding and
conclusive.  Any Shares issuable as a result of any such adjustment shall be
rounded to the next lower whole Share; no fractional Shares shall be issued.  At
all times the conversion of any convertible securities of the Corporation shall
not be treated as a “transaction not involving the receipt of consideration by
the Corporation.”
 
4.4           Substitute Awards.  Awards may, in the discretion of the
Administrator, be granted under the Plan in assumption of, or in substitution
for, outstanding awards previously granted by the Corporation and any Affiliate
or a company acquired by the Corporation or with which the Corporation combines
(“Substitute Awards”).  The number of Shares underlying any Substitute Awards
shall be counted against the aggregate number of Shares available for Awards
under the Plan; provided, however, that Substitute Awards issued in connection
with the assumption of, or in substitution for, outstanding awards previously
granted by an entity that is acquired by the Corporation or its Affiliate
through a merger or acquisition shall not be counted against the aggregate
number of Shares available for Awards under the Plan; provided further, however,
that Substitute Awards issued in connection with the assumption of, or in
substitution for, outstanding stock options intended to qualify for special tax
treatment under Code §§ 421 and 422 that were previously granted by an entity
that is acquired by the Corporation or an Affiliate through a merger or
acquisition shall be counted against the aggregate number of Shares available
for Incentive Stock Options under the Plan.
 
 
 
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ARTICLE 5
PARTICIPATION
 
5.1           Eligibility.  Any Director, Employee or Consultant (including any
prospective Director, Employee or Consultant) of the Corporation and any
Affiliate shall be eligible to be designated a Participant in the Plan for
purposes of receiving Awards.  However, Incentive Stock Options may be granted
only to Employees.
 
5.2           Termination of Participation.  If a Participant is no longer a
Service Provider due to a termination for “Cause,” then all Awards granted to
the Participant shall expire upon the earlier of: (i) the date of the occurrence
giving rise to such termination, or (ii) the natural expiration of the Award
according to its underlying terms.  Thereafter, the Participant shall have no
rights with respect to any Awards under the Plan.
 
(a)           Defining “Cause.”  For purposes of the Plan, “Cause” shall mean a
Participant’s personal dishonesty; misconduct; breach of fiduciary duty;
incompetence; intentional failure to perform stated obligations; willful
violation of any law, rule, regulation or final cease and desist order; or any
material breach of any provision of this Plan, Award Agreement, or any
employment agreement.
 
ARTICLE 6
STOCK OPTIONS
 
6.1           Option Grant.  Subject to the provisions of the Plan, the
Administrator shall have sole and plenary authority to determine the
Participants to whom Options shall be granted, the number of Shares to be
covered by each Option, whether the Option will be an Incentive Stock Option or
a Non-Qualified Stock Option and the conditions and limitations applicable to
the vesting and exercise of the Option.  However, no Participant shall be
granted more than 500,000 Options in any calendar year.  Notwithstanding the
foregoing, the Committee may, from time to time, in its discretion, grant a
Participant an option to purchase more than 500,000 shares of common stock in
any one calendar year, so long as such grant is approved by the Board.  In the
case of Incentive Stock Options, the terms and conditions of such grants shall
be subject to and comply with such rules as may be prescribed by Code § 422 and
any regulations related thereto, as may be amended from time to time.  All
Options granted under the Plan shall be Non-Qualified Stock Options unless the
applicable Award Agreement expressly states that the Option is intended to be an
Incentive Stock Option.  If an Option is intended to be an Incentive Stock
Option, and if for any reason such Option (or any portion thereof) shall not
qualify as an Incentive Stock Option, then, to the extent of such
non-qualification, such Option (or portion thereof) shall be regarded as a
Non-Qualified Stock Option appropriately granted under the Plan, provided that
such Option (or portion thereof) otherwise complies with the Plan’s requirements
relating to Non-Qualified Stock Options.
 
(a)           Term of Option.  The term of each Option will be stated in the
Award Agreement. In the case of an Incentive Stock Option, the term will be 10
years from the date of grant or such shorter term as may be provided in the
Award Agreement. Moreover, in the case of an Incentive Stock Option granted to a
Participant who, at the time the Incentive Stock Option is granted, owns stock
representing more than 10% of the total combined voting power of all classes of
stock of the Corporation or any Affiliate, the term of the Incentive Stock
Option will be five years from the date of grant or such shorter term as may be
provided in the Award Agreement.
 
 
 
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(b)           $100,000 Limitation for Incentive Stock Options.  Each Option will
be designated in the Award Agreement as either an Incentive Stock Option or a
Non-Qualified Stock Option.  However, notwithstanding such designation, to the
extent the aggregate Fair Market Value of the Shares with respect to which
Incentive Stock Options are exercisable for the first time by the Participant
during any calendar year (under all plans of the Corporation and any Affiliate)
exceeds $100,000, such Options will be treated as Non-Qualified Stock
Options.  For purposes of this Section 6.1(b), Incentive Stock Options will be
taken into account in the order in which they were granted.  The Fair Market
Value of the Shares will be determined as of the time the Option with respect to
such Shares is granted.
 
6.2           Exercise Price.  Except as otherwise established by the
Administrator at the time an Option is granted and set forth in the applicable
Award Agreement, the exercise price of each Share covered by an Option shall be
not less than 100% of the Fair Market Value of such Share (determined as of the
date the Option is granted); provided, however, that in the case of an Incentive
Stock Option granted to an Employee who, at the time of the grant of such
Option, owns stock representing more than 10% of the voting power of all classes
of stock of the Corporation and any Affiliate, the per Share exercise price
shall be no less than 110% of the Fair Market Value per Share on the date of the
grant.  Options are intended to qualify as “qualified performance-based
compensation” under Code § 162(m).
 
Notwithstanding the foregoing, Options may be granted with an exercise price of
less than 100% of the Fair Market Value per Share on the date of grant if such
Option is granted pursuant to an assumption or substitution for another option
in a manner satisfying the provisions of Code § 424(a) (involving a corporate
reorganization).
 
6.3           Waiting Period and Exercise Dates.  At the time an Option is
granted, the Administrator will fix the period within which the Option may be
exercised and will determine any conditions that must be satisfied before the
Option may be exercised.
 
6.4           Exercise of Option.
 
(a)           Procedure for Exercise; Rights as a Shareholder.  Any Option
granted hereunder will be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Award Agreement.  An Option may not be exercised for a fraction of
a Share.
 
An Option will be deemed exercised when the Corporation receives: (i) written or
electronic notice of exercise (in accordance with the Award Agreement) from the
person entitled to exercise the Option, and (ii) full payment for the Shares
with respect to which the Option is exercised.  Full payment may consist of any
consideration and method of payment authorized by the Administrator and
permitted by the Award Agreement and the Plan.  Shares issued upon exercise of
an Option will be issued in the name of the Participant or, if requested by the
Participant, in the name of the Participant and his or her spouse.  Until the
Shares are issued (as evidenced by the appropriate entry on the books of the
Corporation or of a duly authorized transfer agent of the Corporation), no right
to vote or receive dividends or any other rights as a shareholder will exist
with respect to the Awarded Stock, notwithstanding the exercise of the
Option.  The Corporation will issue (or cause to be issued) such Shares promptly
after the Option is exercised.  No adjustment will be made for a dividend or
other right for which the record date is prior to the date the Shares are
issued, except as provided in Articles 4 and 13 of the Plan or the applicable
Award Agreement.
 
 
 
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Exercising an Option in any manner will decrease the number of Shares thereafter
available for sale under the Option, by the number of Shares as to which the
Option is exercised.
 
(b)           Termination of Relationship as Service Provider.  If a Participant
ceases to be a Service Provider, other than upon the Participant’s death or
Disability, the Participant may exercise his or her Option within such period of
time as is specified in the Award Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Award Agreement).  In the absence of
a specified time in the Award Agreement, the Option will remain exercisable for
three months following the Participant’s termination.
 
(c)           Disability of Participant.  If a Participant ceases to be a
Service Provider as a result of the Participant’s Disability, the Participant
may exercise his or her Option within such period of time as is specified in the
Award Agreement to the extent the Option is vested on the date of termination
(but in no event later than the expiration of the term of such Option as set
forth in the Award Agreement).  In the absence of a specified time in the Award
Agreement, the Option will remain exercisable for 12 months following the
Participant’s termination.
 
(d)           Death of Participant.  If a Participant dies while a Service
Provider, the Option may be exercised following the Participant’s death within
such period of time as is specified in the Award Agreement to the extent that
the Option is vested on the date of death (but in no event may the option be
exercised later than the expiration of the term of such Option as set forth in
the Award Agreement), by the Participant’s designated beneficiary, provided such
beneficiary has been designated prior to Participant’s death in a form
acceptable to the Administrator.  If no such beneficiary has been designated by
the Participant, then such Option may be exercised by the personal
representative of the Participant’s estate or by the person(s) to whom the
Option is transferred pursuant to the Participant’s will or in accordance with
the laws of descent and distribution.  In the absence of a specified time in the
Award Agreement, the Option will remain exercisable for 12 months following
Participant’s death.
 
(e)           Buyout Provisions.  The Administrator may at any time offer to buy
out for a payment in cash or Shares an Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Participant at the time that such offer is made.
 
(f)           Reversion to Plan.  Unless otherwise provided by the
Administrator, if on the date of termination, Disability or death as provided in
Sections 6.4(b), (c), and (d) of the Plan, Participant is not vested as to his
or her entire Option, the Shares covered by the unvested portion of the Option
will immediately revert to the Plan following the Participant’s termination,
Disability or death.  If the Option is not so exercised within the time
specified herein, the Option will terminate, and the Shares covered by such
Option will revert to the Plan.
 
6.5           Form of Consideration.  The Administrator will determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator will
determine the acceptable form of consideration at the time of grant.  To the
extent permitted by Applicable Laws, consideration may consist entirely of:
 
(a)           cash;
 
(b)           check;
 
 
 
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(c)           promissory note (subject to Section 6.6);
 
(d)           other Shares which meet the conditions established by the
Administrator to avoid adverse accounting consequences (as determined by the
Administrator);
 
(e)           consideration received by the Corporation under a cashless
exercise program implemented by the Corporation in connection with the Plan;
 
(f)            a reduction in the amount of any Corporation liability to the
Participant, including any liability attributable to the Participant’s
participation in any Corporation-sponsored deferred compensation program or
arrangement;
 
(g)           any combination of the foregoing methods of payment; or
 
(h)           such other consideration and method of payment for the issuance of
Shares to the extent permitted by Applicable Laws.
 
6.6           Promissory Note.  Where applicable and subject to the requirements
of Applicable Law, payment of all or part of the purchase price of an Award may
be made by delivery of a full recourse promissory note (“Promissory Note”).  The
Promissory Note shall be executed by the Participant, made payable to the
Corporation and bear interest at such rate as the Administrator shall determine,
but in no case less than the minimum rate which will not cause under the Code:
(i) imputed interest, (ii) original issue discount, or (iii) any other similar
result.  Unless otherwise determined by the Administrator, interest on the
Promissory Note shall be payable in quarterly installments on March 31, June 30,
September 30, and December 31 of each calendar year.  A Promissory Note shall
contain such other terms and conditions as may be determined by the
Administrator; provided, however, that the full principal amount of the
Promissory Note and all unpaid interest accrued thereon shall be due not later
than five years from the date of exercise.  The Corporation may obtain from the
Participant a security interest in all Awards issued to the Participant under
the Plan for the purpose of securing payment under the Promissory Note and may
retain possession of, where applicable, the Share certificates in order to
perfect its security interest.
 
ARTICLE 7
RESTRICTED STOCK
 
7.1           Grant of Restricted Stock.  Subject to the terms and provisions of
the Plan, the Administrator, at any time and from time to time, may grant Shares
of Restricted Stock to Service Providers in such amounts as the Administrator,
in its sole discretion, will determine.
 
7.2           Restricted Stock Agreement.  Each Award of Restricted Stock will
be evidenced by an Award Agreement that will specify the Period of Restriction,
the number of Shares granted, and such other terms and conditions as the
Administrator will determine in its sole discretion.  Unless the Administrator
determines otherwise, Shares of Restricted Stock will be held by the Corporation
as escrow agent until the restrictions on such Shares have lapsed.
 
7.3           Transferability.  Except as provided in this Article 7, Shares of
Restricted Stock may not be sold, transferred, pledged, assigned or otherwise
alienated or hypothecated until the end of the applicable Period of Restriction.
 
 
 
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7.4           Other Restrictions.  The Administrator, in its sole discretion,
may impose such other restrictions on Shares of Restricted Stock as it may deem
advisable or appropriate.
 
7.5           Removal of Restrictions.  Except as otherwise provided in this
Article 7, Shares of Restricted Stock covered by each Restricted Stock grant
made under the Plan will be released from escrow as soon as practicable after
the last day of the Period of Restriction.  The Administrator, in its
discretion, may accelerate the time at which any restrictions will lapse or be
removed.
 
7.6           Voting Rights.  During the Period of Restriction, Service
Providers holding Shares of Restricted Stock granted hereunder may exercise full
voting rights with respect to those Shares, unless the Administrator determines
otherwise.
 
7.7           Dividends and Other Distributions.  During the Period of
Restriction, Service Providers holding Shares of Restricted Stock will be
entitled to receive all dividends and other distributions paid with respect to
such Shares unless otherwise provided in the Award Agreement.  If any such
dividends or distributions are paid in Shares, the Shares will be subject to the
same restrictions on transferability and forfeitability as the Shares of
Restricted Stock with respect to which they were paid.
 
7.8           Return of Restricted Stock to Corporation.  On the date set forth
in the Award Agreement, the Restricted Stock for which restrictions have not
lapsed will revert to the Corporation and again will become available for grant
under the Plan.
 
ARTICLE 8
UNRESTRICTED STOCK
 
Pursuant to the terms of the applicable Award Agreement, a Service Provider may
be awarded (or sold at a discount) shares of Common Stock that are not subject
to a Period of Restriction, in consideration for past services rendered thereby
to the Corporation and any Affiliate or for other valid consideration.
 
ARTICLE 9
STOCK APPRECIATION RIGHTS
 
9.1           Grant of SARs.  Subject to the terms and conditions of the Plan, a
SAR may be granted to Service Providers at any time and from time to time as
will be determined by the Administrator, in its sole discretion.
 
9.2           Number of Shares.  The Administrator will have sole discretion to
determine the number of SARs granted to any Service Provider.
 
9.3           Exercise Price and Other Terms.  The Administrator, subject to the
provisions of the Plan, will have sole discretion to determine the terms and
conditions of SARs granted under the Plan.
 
9.4           SAR Agreement.  Each SAR grant will be evidenced by an Award
Agreement that will specify the exercise price, the term of the SAR, the
conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, will determine.
 
 
 
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9.5           Expiration of SARs.  A SAR granted under the Plan will expire upon
the date determined by the Administrator, in its sole discretion, and as set
forth in the Award Agreement. Notwithstanding the foregoing, the rules of
Sections 6.4(b), (c) and (d) will also apply to SARs.
 
9.6           Payment of SAR Amount.  Upon exercise of a SAR, a Participant will
be entitled to receive payment from the Corporation an amount determined by
multiplying: (i) the difference between the Fair Market Value of a Share on the
date of exercise over the exercise price; times (ii) the number of Shares with
respect to which the SAR is exercised.  At the discretion of the Administrator,
the payment upon SAR exercise may be in cash, in Shares of equivalent value,
other securities, other Awards, other property or a combination of any of the
foregoing.
 
9.7           Buyout Provisions.  The Administrator may at any time offer to buy
out for a payment in cash or Shares a SAR previously granted based on such terms
and conditions as the Administrator shall establish and communicate to the
Participant at the time that such offer is made.
 
ARTICLE 10
PERFORMANCE UNITS AND PERFORMANCE SHARES
 
10.1         Grant of Performance Units/Shares.  Subject to the terms and
conditions of the Plan, Performance Units and Performance Shares may be granted
to Service Providers at any time and from time to time, as will be determined by
the Administrator, in its sole discretion.  The Administrator will have complete
discretion in determining the number of Performance Units and Performance Shares
granted to each Participant.
 
10.2         Value of Performance Units/Shares.  Each Performance Unit will have
an initial value that is established by the Administrator on or before the date
of grant.  Each Performance Share will have an initial value equal to the Fair
Market Value of a Share on the date of grant.
 
10.3         Performance Objectives and Other Terms.  The Administrator will set
performance objectives in its discretion which, depending on the extent to which
they are met, will determine the number or value of Performance Units/Shares
that will be paid out to the Service Providers.  The time period during which
the performance objectives must be met will be called the “Performance
Period.”  Each Award of Performance Units/Shares will be evidenced by an Award
Agreement that will specify the “Performance Period,” and such other terms and
conditions as the Administrator, in its sole discretion, will determine.  The
Administrator may set performance objectives based upon the achievement of
Corporation-wide, divisional, or individual goals, applicable federal or state
securities laws, or any other basis determined by the Administrator in its
discretion.
 
10.4         Earning of Performance Units/Shares.  After the applicable
“Performance Period” has ended, the holder of Performance Units/Shares will be
entitled to receive a payout of the number of Performance Units/Shares earned by
the Participant over the “Performance Period,” to be determined as a function of
the extent to which the corresponding performance objectives have been
achieved.  After the grant of a Performance Unit/Share, the Administrator, in
its sole discretion, may reduce or waive any performance objectives for such
Performance Unit/Share.
 
10.5         Form and Timing for Payment of Performance Units/Shares.  Payment
of earned Performance Units/Shares will be made as soon after the expiration of
the applicable Performance Period at the time determined by the
Administrator.  The Administrator, in its sole discretion, may pay earned
Performance Units/Shares in the form of cash, in Shares (which have an aggregate
Fair Market Value equal to the value of the earned Performance Units/Shares at
the close of the applicable Performance Period) or in a combination thereof.
 
 
 
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10.6         Cancellation of Performance Units/Shares.  On the date set forth in
the Award Agreement, all unearned or unvested Performance Units/Shares will be
forfeited to the Corporation, and again will be available for grant under the
Plan.
 
ARTICLE 11
RESTRICTED STOCK UNITS
 
Restricted Stock Units are Awards consisting of Restricted Stock, Performance
Shares and/or Performance Units that the Administrator, in its sole discretion
permits to be paid out in installments or on a deferred basis, in accordance
with rules and procedures established by the Administrator and in conformance
with Code § 409A.
 
ARTICLE 12
OTHER STOCK BASED AWARDS
 
Other Stock Based Awards may be granted either alone, in addition to, or in
tandem with, other Awards granted under the Plan and/or cash awards made outside
of the Plan. The Administrator shall have authority to determine the Service
Providers to whom and the time or times at which Other Stock Based Awards shall
be made, the amount of such Other Stock Based Awards, and all other conditions
of the Other Stock Based Awards including any dividend and/or voting rights.
 
ARTICLE 13
DISSOLUTION OR LIQUIDATION; OR CHANGE IN CONTROL
 
13.1         Dissolution or Liquidation.  In the event of the proposed
dissolution or liquidation of the Corporation, the Administrator will notify
each Participant as soon as practicable prior to the effective date of such
proposed transaction. The Administrator in its discretion may provide for a
Participant to have the right to exercise his or her Award, to the extent
applicable, until 10 days prior to such transaction as to all of the Awarded
Stock covered thereby, including Shares as to which the Award would not
otherwise be exercisable. In addition, the Administrator may provide that any
Corporation repurchase option or forfeiture rights applicable to any Award shall
lapse 100%, and that any Award vesting shall accelerate 100%, provided the
proposed dissolution or liquidation takes place at the time and in the manner
contemplated. To the extent it has not been previously exercised or vested, an
Award will terminate immediately prior to the consummation of such proposed
action.
 
 
 
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13.2         Change in Control.
 
(a)           Options and SARs.  In the event of a Change in Control, each
outstanding Option and SAR shall be assumed or an equivalent option or SAR
substituted by the successor corporation or Affiliate of the successor
corporation. With respect to Options and SARs granted to an Outside Director
that are assumed or substituted for, if immediately prior to or after the Change
in Control the Participant’s status as a Director or a director of the successor
corporation, as applicable, is terminated other than upon a voluntary
resignation by the Participant, then the Participant shall fully vest in and
have the right to exercise such Options and SARs as to all of the Awarded Stock,
including Shares as to which it would not otherwise be vested or exercisable.
Unless otherwise determined by the Administrator, in the event that the
successor corporation refuses to assume or substitute for the Option or SAR, the
Participant shall fully vest in and have the right to exercise the Option or SAR
as to all of the Awarded Stock, including Shares as to which it would not
otherwise be vested or exercisable. If an Option or SAR is not assumed or
substituted in the event of a Change in Control, the Administrator shall notify
the Participant in writing or electronically that the Option or SAR shall be
exercisable for a period of up to 15 days from the date of such notice, and the
Option or SAR shall terminate upon the expiration of such period. For the
purposes of this paragraph, the Option or SAR shall be considered assumed if,
following the Change in Control, the option or stock appreciation right confers
the right to purchase or receive, for each Share of Awarded Stock subject to the
Option or SAR immediately prior to the Change in Control, the consideration
(whether stock, cash, or other securities or property) received in the Change in
Control by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the type
of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change in Control
is not solely common stock of the successor corporation or its Affiliate, the
Administrator may, with the consent of the successor corporation, provide for
the consideration to be received upon the exercise of the Option or SAR, for
each Share of Awarded Stock subject to the Option or SAR, to be solely common
stock of the successor corporation or its Affiliate equal in fair market value
to the per share consideration received by holders of Common Stock in the Change
in Control. Notwithstanding anything herein to the contrary, an Award that
vests, is earned or paid-out upon the satisfaction of one or more performance
goals will not be considered assumed if the Corporation or its successor
modifies any of such performance goals without the Participant’s consent;
provided, however, a modification to such performance goals only to reflect the
successor corporation’s post-Change in Control corporate structure will not be
deemed to invalidate an otherwise valid Award assumption.
 
(b)           Restricted Stock, Unrestricted Stock, Performance Shares,
Performance Units, Restricted Stock Units, and Other Stock Based Awards.  In the
event of a Change in Control, each outstanding Restricted Stock, Unrestricted
Stock, Performance Share, Performance Unit, Other Stock Based Award and
Restricted Stock Unit awards shall be assumed or an equivalent Restricted Stock,
Unrestricted Stock, Performance Share, Performance Unit, Other Stock Based Award
and Restricted Stock Unit award substituted by the successor corporation or an
Affiliate of the successor corporation.  With respect to Awards granted to an
Outside Director that are assumed or substituted for, if immediately prior to or
after the Change in Control the Participant’s status as a Director or a director
of the successor corporation, as applicable, is terminated other than upon a
voluntary resignation by the Participant, then the Participant shall fully vest
in such Awards, including Shares as to which it would not otherwise be
vested.  Unless determined otherwise by the Administrator, in the event that the
successor corporation refuses to assume or substitute for the Restricted Stock,
Unrestricted Stock, Performance Share, Performance Unit, Other Stock Based Award
or Restricted Stock Unit award, the Participant shall fully vest in the
Restricted Stock, Unrestricted Stock, Performance Share, Performance Unit, Other
Stock Based Award or Restricted Stock Unit including as to Shares which would
not otherwise be vested. For the purposes of this paragraph, a Restricted Stock,
Unrestricted Stock, Performance Share, Performance Unit, Other Stock Based Award
and Restricted Stock Unit award shall be considered assumed if following the
Change in Control, the award confers the right to purchase or receive, for each
Share subject to the Award immediately prior to the Change in Control, the
consideration (whether stock, cash, or other securities or property) received in
the Change in Control by holders of Common Stock for each Share held on the
effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received
in the Change in Control is not solely common stock of the successor corporation
or its Affiliate, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received, for each Share and
each unit/right to acquire a Share subject to the Award, to be solely common
stock of the successor corporation or its Affiliate equal in fair market value
to the per share consideration received by holders of Common Stock in the Change
in Control. Notwithstanding anything herein to the contrary, an Award that
vests, is earned or paid-out upon the satisfaction of one or more performance
goals will not be considered assumed if the Corporation or its successor
modifies any of such performance goals without the Participant’s consent;
provided, however, a modification to such performance goals only to reflect the
successor corporation’s post-Change in Control corporate structure will not be
deemed to invalidate an otherwise valid Award assumption.
 
 
 
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ARTICLE 14
MISCELLANEOUS PROVISIONS
 
14.1         No Uniform Rights to Awards.  The Corporation has no obligation to
uniformly treat Participants or holders or beneficiaries of Awards.  The terms
and conditions of Awards and the Administrator’s determinations and
interpretations with respect thereto need not be the same with respect to each
Participant and may be made selectively among Participants, whether or not such
Participants are similarly situated.
 
14.2         Share Certificates.  All certificates for Shares or other
securities of the Corporation or Affiliate delivered under the Plan pursuant to
any Award or the exercise thereof shall be subject to such stop transfer orders
and other restrictions as the Administrator may deem advisable under the Plan,
the applicable Award Agreement or the rules, regulations and other requirements
of the SEC, the NYSE or any other stock exchange or quotation system upon which
such Shares or other securities are then listed or reported and any applicable
Federal or state laws, and the Administrator may cause a legend or legends to be
put on any such certificates to make appropriate reference to such restrictions.
 
14.3         No Rights as a Service Provider.  Neither the Plan nor any Award
shall confer upon a Participant any right with respect to continuing his or her
relationship as a Service Provider, nor shall they interfere in any way with the
right of the Participant or the right of the Corporation or its Affiliate to
terminate such relationship at any time, with or without cause.
 
14.4         No Rights as Shareholder.  No Participant or holder or beneficiary
of any Award shall have any rights as a shareholder with respect to any Shares
to be distributed under the Plan until he or she has become the holder of such
Shares.  In connection with each grant of Restricted Stock, except as provided
in the applicable Award Agreement, the Participant shall not be entitled to the
rights of a shareholder in respect of such Restricted Shares.  Except as
otherwise provided in Section 4.3 or the applicable Award Agreement, no
adjustments shall be made for dividends or distributions on (whether ordinary or
extraordinary, and whether in cash, Shares, other securities or other property),
or other events relating to, Shares subject to an Award for which the record
date is prior to the date such Shares are delivered.
 
14.5         No Trust or Fund Created.  Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Corporation or Affiliate, on one hand, and a
Participant or any other person, on the other.  To the extent that any person
acquires a right to receive payments from the Corporation or Affiliate pursuant
to an Award, such right shall be no greater than the right of any unsecured
general creditor of the Corporation or Affiliate.
 
 
 
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14.6         No Fractional Shares.  No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award, and the Administrator shall
determine whether cash, other securities or other property shall be paid or
transferred in lieu of any fractional Shares or whether such fractional Shares
or any rights thereto shall be cancelled, terminated or otherwise eliminated.
 
14.7         Requirement of Consent and Notification of Election Under Code
§ 83(b) or Similar Provision.  No election under Code § 83(b) (to include in
gross income in the year of transfer the amounts specified in Code § 83(b)) or
under a similar provision of law may be made unless expressly permitted by the
terms of the applicable Award Agreement or by action of the Administrator in
writing prior to the making of such election.  If an Award recipient, in
connection with the acquisition of Shares under the Plan or otherwise, is
expressly permitted under the terms of the applicable Award Agreement or by such
Administrator action to make such an election and the Participant makes the
election, the Participant shall notify the Administrator of such election within
10 days of filing notice of the election with the IRS or other governmental
authority, in addition to any filing and notification required pursuant to
regulations issued under Code § 83(b) or other applicable provision.
 
14.8         Requirement of Notification Upon Disqualifying Disposition Under
Code § 421(b).  If any Participant shall make any disposition of Shares
delivered pursuant to the exercise of an Incentive Stock Option under the
circumstances described in Code § 421(b) (relating to certain disqualifying
dispositions) or any successor provision of the Code, such Participant shall
notify the Corporation of such disposition within 10 days of such disposition.
 
14.9         Leaves of Absence.  Unless the Administrator provides otherwise,
vesting of Awards granted hereunder will be suspended during any unpaid leave of
absence and will resume on the date the Participant returns to work on a regular
schedule as determined by the Corporation; provided, however, that no vesting
credit will be awarded for the time vesting has been suspended during such leave
of absence.  A Service Provider will not cease to be an Employee in the case of
(i) any leave of absence approved by the Corporation or (ii) transfers between
locations of the Corporation or between the Corporation or its Affiliate.  For
purposes of Incentive Stock Options, no such leave may exceed 3 months, unless
reemployment upon expiration of such leave is guaranteed by statute or
contract.  If reemployment upon expiration of a leave of absence approved by the
Corporation is not so guaranteed, then 6 months from the first day of such leave
any Incentive Stock Option held by the Participant will cease to be treated as
an Incentive Stock Option and will be treated for tax purposes as a
Non-Qualified Stock Option.
 
14.10       Notices.  Any written notice to the Corporation required by any
provisions of the Plan shall be addressed to the Secretary of the Corporation
and shall be effective when received.
 
14.11       Non-Transferability of Awards.  Other than pursuant to a domestic
relations order (within the meaning of Rule 16a-12 promulgated under the
Exchange Act) and unless determined otherwise by the Administrator, an Award may
not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution, and may be
exercised, during the lifetime of the Participant, only by the Participant. If
the Administrator makes an Award transferable, such Award will contain such
additional terms and conditions as the Administrator deems appropriate.
 
 
 
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14.12       Date of Grant.  The date of grant of an Award will be, for all
purposes, the date on which the Administrator makes the determination granting
such Award, or such other later date as is determined by the Administrator.
Notice of the determination will be provided to each Participant within a
reasonable time after the date of such grant.
 
14.13       Amendment and Termination of Plan.
 
(a)           Amendment and Termination.  The Board may at any time amend,
alter, suspend or terminate the Plan.  Unless sooner terminated, this Plan shall
terminate on November 6, 2013, the date that is 10 years from the date the Plan
was originally adopted by the Board or approved by the shareholders of the
Corporation, whichever was earlier.
 
(b)           Shareholder Approval.  The Corporation will obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
 
(c)           Effect of Amendment or Termination.  Subject to Section 14.15 of
the Plan, no amendment, alteration, suspension or termination of the Plan will
impair the rights of any Participant, unless mutually agreed upon between the
Participant and the Administrator, which agreement must be in writing and signed
by the Participant and the Corporation. Termination of the Plan will not affect
the Administrator’s ability to exercise the powers granted to it hereunder with
respect to Awards granted under the Plan prior to the date of such termination.
 
14.14       Conditions Upon Issuance of Shares.
 
(a)           Legal Compliance.  Shares will not be issued pursuant to the
exercise of an Award unless the exercise of such Award and the issuance and
delivery of such Shares will comply with Applicable Laws and will be further
subject to the approval of counsel for the Corporation with respect to such
compliance.
 
(b)           Investment Representations.  As a condition to the exercise or
receipt of an Award, the Corporation may require the person exercising or
receiving such Award to represent and warrant at the time of any such exercise
or receipt that the Shares are being purchased only for investment and without
any present intention to sell or distribute such Shares if, in the opinion of
counsel for the Corporation, such a representation is required.
 
14.15       Severability.  Notwithstanding any contrary provision of the Plan or
an Award to the contrary, if any one or more of the provisions (or any part
thereof) of this Plan or the Awards shall be held invalid, illegal or
unenforceable in any respect, such provision shall be modified so as to make it
valid, legal and enforceable, and the validity, legality and enforceability of
the remaining provisions (or any part thereof) of the Plan or Award, as
applicable, shall not in any way be affected or impaired thereby.
 
14.16       Inability to Obtain Authority.  The inability of the Corporation to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Corporation’s counsel to be necessary to the lawful issuance
and sale of any Shares hereunder, will relieve the Corporation of any liability
in respect of the failure to issue or sell such Shares as to which such
requisite authority will not have been obtained.
 
 
 
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14.17       Shareholder Approval.  The Plan will be subject to approval by the
shareholders of the Corporation within 12 months after the date the Plan is
adopted. Such shareholder approval will be obtained in the manner and to the
degree required under Applicable Laws, and is effective as of the Effective
Date.
 
14.18       Governing Law.  The validity, construction and effect of the Plan
and any rules and regulations relating to the Plan and any Award Agreement shall
be determined in accordance with the laws of the State of Illinois, without
giving effect to the conflict of laws provisions thereof.
 
 
Approved by the Shareholders: December 29, 2011
 
 
 
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