Exhibit 10.1

 

CABOT OIL & GAS CORPORATION

 

2014 INCENTIVE PLAN

 

(As Established Effective as of May 1, 2014)

 

1.                                      Objectives.  The Cabot Oil & Gas
Corporation 2014 Incentive Plan (the “Plan”) is designed to attract and retain
nonemployee directors, employees and consultants and reward them for making
contributions to the success of Cabot Oil & Gas Corporation and its Subsidiaries
(as hereinafter defined). These objectives are to be accomplished by making
awards under the Plan and thereby providing Participants (as hereinafter
defined) with a proprietary interest in the growth and performance of the
Company.

 

2.                                      Definitions.  As used herein, the terms
set forth below shall have the following respective meanings:

 

“Award” means an Employee Award, a Director Award, or a Consultant Award.

 

“Award Agreement” means the document (in written or electronic form)
communicating the terms, conditions and limitations applicable to an Award.  The
Committee may, in its discretion, require that the Participant execute such
Award Agreement, or may provide for procedures through which Award Agreements
are made effective without execution.  Any Participant who is granted an Award
and who does not affirmatively reject the applicable Award Agreement shall be
deemed to have accepted the terms of Award as embodied in the Award Agreement.

 

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

 

“Cash Award” means an Award denominated in cash.

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Committee” means such committee of the Board as is designated by the Board to
administer the Plan, provided that such committee is comprised entirely of
Nonemployee Directors.

 

“Common Stock” means the Common Stock, par value $.10 per share, of the Company.

 

“Company” means Cabot Oil & Gas Corporation, a Delaware corporation, or any
successor thereto.

 

“Consultant” means a person other than an Employee or a Nonemployee Director
providing bona fide services to the Company or any of its Subsidiaries as a
consultant or advisor, as applicable, provided that such person is a natural
person and that such services are not in connection with the offer or sale of
securities in a capital-raising transaction and do not directly or indirectly
promote or maintain a market for any securities of the Company.

 

1

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

 

“Consultant Award” means the grant of any Nonqualified Stock Option, SAR, Stock
Award, Performance Award or Cash Award, whether granted singly, in combination
or in tandem, to a Consultant pursuant to such applicable terms, conditions and
limitations as may be established in order to fulfill the objectives of the
Plan.

 

“Director” means an individual serving as a member of the Board.

 

“Director Award” means the grant of any Nonqualified Stock Option or Stock
Award, whether granted singly, in combination, or in tandem, to a Nonemployee
Director pursuant to such applicable terms, conditions, and limitations as may
be established in order to fulfill the objectives of the Plan.

 

“Employee” means any person who is receiving remuneration for personal services
(or could be receiving remuneration except for an authorized leave of absence)
as an employee of the Company or any of its Subsidiaries.

 

“Employee Award” means the grant of any form of Stock Option, Stock Appreciation
Right, Stock Award, Performance Award or Cash Award, whether granted singly, in
combination or in tandem, to an Employee pursuant to any applicable terms,
conditions and limitations as the Committee may establish in order to fulfill
the objectives of the Plan.

 

“Fair Market Value” of a share of Common Stock means, as of a particular date,
(i)(A) if the shares of Common Stock are listed on a national securities
exchange, the last reported sales price per share of the Common Stock on the
consolidated transaction reporting system for the principal national securities
exchange on which shares of Common Stock are listed on that date, or, if there
shall have been no such sale so reported on that date, on the last preceding
date on which such a sale was so reported, or, at the discretion of the
Committee, the price prevailing on the exchange at the time of exercise or other
relevant event (as determined under procedures established by the Committee),
(B) if the shares of Common Stock are not so listed but are quoted by the NASDAQ
Global Select Market, the last reported sales price per share of Common Stock
reported on the consolidated transaction reporting system for the NASDAQ Global
Select Market, or, if there shall have been no such sale so reported on that
date, on the last preceding date on which such a sale was so reported or, at the
discretion of the Committee, the price prevailing on the NASDAQ Global Select
Market at the time of exercise or other relevant event, (C) if the shares of
Common Stock are not so listed or quoted, the average of the closing bid and
asked price on that date, or, if there are no quotations available for such
date, on the last preceding date on which such quotations shall be available, as
reported by the NASDAQ Global Select Market, or, if not reported by the NASDAQ
Global Select Market, by the OTC Market Group, or (D) if the shares of Common
Stock are not publicly traded, the most recent value determined by an
independent appraiser appointed by the Company for such purpose, or (ii) if
applicable, the price per share as determined in accordance with the procedures
of a third party administrator retained by the Company to administer the Plan
and as approved by the Committee.

 

2

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

 

“Incentive Stock Option” or “ISO” means a Stock Option that is intended to
comply with Section 422 of the Code.

 

“Nonemployee Director” means an individual serving as a member of the Board who
is not an Employee.

 

“Nonqualified Stock Option” means a Stock Option that is not an Incentive Stock
Option.

 

“Participant” means an Employee, Nonemployee Director, or Consultant to whom an
Award has been made under this Plan.

 

“Performance Award” means an Award made pursuant to this Plan that is subject to
the attainment in the future of one or more Performance Goals.

 

“Performance Goal” means one or more standards established by the Committee to
determine in whole or in part whether a Performance Award shall be earned.

 

“Prior Plan” means the Cabot Oil & Gas Corporation 2004 Incentive Plan, and any
other stock incentive plans of the Company under which awards are outstanding or
under which shares have been reserved but not yet used.

 

“Qualified Performance Award” means a Performance Award made to a Participant
who is an Employee that is intended to qualify as qualified performance-based
compensation under Section 162(m) of the Code, as described in Paragraph
7(a)(v)(B) of the Plan.

 

“Restricted Stock” means Common Stock that is restricted or subject to
forfeiture provisions.

 

“Restricted Stock Unit” means a Stock Unit that is restricted or subject to
forfeiture provisions.

 

“Restriction Period” means a period of time beginning as of the date of grant of
an Award of Restricted Stock or Restricted Stock Units and ending as of the date
upon which the Common Stock subject to such Award is no longer restricted or
subject to forfeiture provisions.

 

“Stock Award” means an Award consisting of Common Stock or Stock Units,
including the award of Restricted Stock or Restricted Stock Units.

 

“Stock Appreciation Right” or “SAR” means the right to receive a payment, in
cash or Common Stock, equal to the excess of the Fair Market Value or other
specified valuation of a number of shares of Common Stock on the date the stock
appreciation right is exercised over a specific strike price, in each case as
determined by the Committee.

 

3

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

 

“Stock Based Awards Limitations” means the limitations applied to any awards
granted hereunder as described in Paragraphs 7(b)(i) and (ii) and Paragraph
8(b) of the Plan.

 

“Stock Option” means a right to purchase a specified number of shares of Common
Stock at a specified exercise price, which right may be an Incentive Stock
Option or a Nonqualified Stock Option.

 

“Stock Unit” means a unit evidencing the right to receive in specified
circumstances one share of Common Stock (as determined by the Committee or the
Board), which, in the discretion of the Committee, may be restricted or subject
to forfeiture provisions.

 

“Subsidiary” means (i) in the case of a corporation, any corporation of which
the Company directly or indirectly owns shares representing 50% or more of the
combined voting power of the shares of all classes or series of capital stock of
such corporation which have the right to vote generally on matters submitted to
a vote of the stockholders of such corporation, (ii) in the case of a
partnership or other business entity not organized as a corporation, any such
business entity of which the Company directly or indirectly owns 50% or more of
the voting, capital or profits interests (whether in the form of partnership
interests, membership interests or otherwise), and (iii) any other corporation,
partnership or other entity that is a “subsidiary” of the Company within the
meaning of Rule 405 promulgated by the Securities and Exchange Commission under
the Securities Act of 1933, as amended.

 

3.                                      Eligibility.

 

(a)                                 Employees. Employees and individuals who
have agreed to become Employees are eligible for an Employee Award under this
Plan.

 

(b)                                 Directors. Nonemployee Directors are
eligible for the grant of Director Awards under this Plan.

 

(c)                                  Consultants. Consultants are eligible for
the grant of Consultant Awards under this Plan.

 

4.                                      Common Stock Available for Awards. 
Subject to the provisions of Paragraph 15 hereof, there shall be available for
Awards granted wholly or partly in Common Stock (including rights or options
which may be exercised for or settled in Common Stock) during the term of this
Plan an aggregate of 18,000,000 shares of Common Stock.  No more than 10,000,000
shares of Common Stock will be used for Incentive Stock Options. The Board and
the appropriate officers of the Company are authorized to take from time to time
whatever actions are necessary, and to file required documents with governmental
authorities and stock exchanges and transaction reporting systems, to make
shares of Common Stock available for issuance pursuant to Awards. Common Stock
related to Awards under this Plan that are forfeited or terminated, expire
unexercised, are settled in cash in lieu of Stock or in a manner such that all
or some of the shares covered by an Award are not issued to a Participant, or
are exchanged for Awards that do not involve Common Stock, shall immediately
become available for Awards hereunder. If the purchase price of any Award
granted under the Plan is satisfied by tendering

 

4

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

 

shares of Common Stock to the Company, or if the tax withholding obligation
resulting from the settlement of any such Option or other Award is satisfied by
tendering or withholding shares of Common Stock, only the number of shares of
Common Stock issued net of the shares of Common Stock tendered or withheld shall
be deemed delivered for purposes of determining usage of shares against the
maximum number of shares of Common Stock available for delivery under the Plan
or any sub limit set forth above.  Shares of Common Stock delivered under the
Plan as an Award or in settlement of an Award issued or made (a) upon the
assumption, substitution, conversion or replacement of outstanding awards under
a plan or arrangement of an entity acquired in a merger or other acquisition or
(b) as a post-transaction grant under such a plan or arrangement of an acquired
entity shall not reduce or be counted against the maximum number of shares of
Common Stock available for delivery under the Plan, to the extent that the
exemption for transactions in connection with mergers and acquisitions from the
stockholder approval requirements of the New York Stock Exchange for equity
compensation plans applies. The Committee may from time to time adopt and
observe such rules and procedures concerning the counting of shares against the
Plan maximum or any sub limit as it may deem appropriate, including rules more
restrictive than those set forth above to the extent necessary to satisfy the
requirements of any national stock exchange on which the Common Stock is listed
or any applicable regulatory requirement.

 

5.                                      Administration.

 

(a)                                 This Plan shall be administered by the
Committee except as otherwise provided herein.

 

(b)                                 Subject to the provisions hereof, the
Committee shall have full and exclusive power and authority to administer this
Plan and to take all actions that are specifically contemplated hereby or are
necessary or appropriate in connection with the administration hereof. The
Committee shall also have full and exclusive power to interpret this Plan and to
adopt such rules, regulations and guidelines for carrying out this Plan as it
may deem necessary or proper. The Committee may, in its discretion, provide for
the extension of the exercisability of an Employee Award or Consultant Award,
accelerate the vesting or exercisability of an Employee Award or Consultant
Award, eliminate or make less restrictive any restrictions applicable to an
Employee Award or Consultant Award, waive any restriction or other provision of
this Plan (insofar as such provision related to Employee Awards or Consultant
Awards) or an Employee Award or Consultant Award or otherwise amend or modify an
Employee Award or Consultant Award in any manner that is either (i) not
materially adverse to the Participant to whom such an Employee Award or
Consultant Award was granted or (ii) consented to by such Participant.
Notwithstanding anything herein to the contrary, except as expressly provided by
the adjustment provisions of Paragraph 15, without the approval of the Company’s
stockholders, Stock Options and SARs issued under the Plan will not be
(i) repriced, replaced, or regranted through cancellation or by decreasing the
exercise price of a previously granted Stock Option or SAR or (ii) canceled in
exchange for cash or other Awards or Stock Options or SARs with an exercise
price that is less than the exercise price of the original Stock Options or
SARs. The Committee may correct any defect or supply any omission or reconcile
any inconsistency in this Plan or in any Award in the manner and to the extent
the Committee deems

 

5

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

 

necessary or desirable to further the Plan purposes. Any decision of the
Committee in the interpretation and administration of this Plan shall lie within
its sole and absolute discretion and shall be final, conclusive and binding on
all parties concerned. No member of the Committee or officer of the Company to
whom it has delegated authority in accordance with the provisions of Paragraph 6
of this Plan shall be liable for anything done or omitted to be done by him or
her, by any member of the Committee or by any officer of the Company in
connection with the performance of any duties under this Plan, except for his or
her own willful misconduct or as expressly provided by statute. The Committee
shall establish the vesting schedule, if any, for each Award.

 

(c)                                  The Board shall have the same powers,
duties, and authority to administer the Plan with respect to Director Awards as
the Committee retains with respect to Employee Awards and Consultant Awards.

 

6.                                      Delegation of Authority.  Following the
authorization of a pool of cash or shares of Common Stock to be available for
Awards, the Board or the Committee may authorize the Chief Executive Officer
and/or another executive officer of the Company, if and to the extent permitted
by applicable law, rule or regulation, or a subcommittee of members of the
Board, to grant individual Employee Awards from such pool pursuant to such
conditions or limitations as the Board or the Committee may establish. The Board
or Committee may also delegate to the Chief Executive Officer and to other
employees of the Company its administrative duties under this Plan (excluding
its granting authority) pursuant to such conditions or limitations as the
Committee may establish. The Board or Committee may engage or authorize the
engagement of a third party administrator to carry out administrative functions
under the Plan.

 

7.                                      Employee Awards and Consultant Awards.

 

(a)                                 The Committee (or other committee to whom
such authority is delegated under Paragraph 6 above) shall determine the type or
types of Employee Awards to be made under this Plan and shall designate from
time to time Employees who are to be recipients of such Awards. Each Employee
Award made hereunder may, in the discretion of the Committee, be embodied in an
Award Agreement, which shall contain such terms, conditions, performance
requirements and limitations as shall be determined by the Committee in its sole
discretion and shall, if required by the Committee, be signed by the Participant
to whom the Employee Award is granted and signed for and on behalf of the
Company. Employee Awards may consist of those listed in this Paragraph 7 and may
be granted singly, in combination or in tandem. Employee Awards may also be
granted in combination or in tandem with, in replacement of (subject to
Paragraph 12), or as alternatives to, grants or rights under this Plan or any
other employee plan of the Company or any of its Subsidiaries, including the
plan of any acquired entity. An Employee Award may provide for the grant or
issuance of additional, replacement or alternative Employee Awards upon the
occurrence of specified events. All or part of an Employee Award may be subject
to conditions established by the Committee, which may include, but are not
limited to, continuous service with the Company and its Subsidiaries,
achievement of specific business objectives, items referenced to in clause
(v) below, and other comparable measurements of performance.

 

6

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

 

(i)                                     Stock Option.  An Employee Award may
consist of a right to purchase a specified number of shares of Common Stock at a
specified price that is not less than the greater of (i) the Fair Market Value
of the Common Stock on the date of grant and (ii) the par value of the Common
Stock on the date of grant. A Stock Option may be in the form of an Incentive
Stock Option or a Nonqualified Stock Option. The term of the Stock Option shall
extend no more than 10 years after the date of grant; provided, however, if the
term of a Nonqualified Stock Option (but not an Incentive Stock Option) expires
when trading in the Common Stock is prohibited by law or the Company’s insider
trading policy, then the term of such Nonqualified Stock Option shall expire on
the 30th day after the expiration of such prohibition.  Unless otherwise
provided in the applicable Award Agreement, upon the expiration of the term of a
Stock Option (as extended, if applicable, by the previous sentence) if the Stock
Option remains unexercised and the exercise price is less than the Fair Market
Value of a share of Common Stock, then the Stock Option shall automatically be
exercised by means of a cashless exercise method approved by the
Committee.  Stock Options may not include provisions that “reload” the Stock
Option upon exercise. Subject to the foregoing provisions, the terms, conditions
and limitations applicable to any Stock Options awarded to Employees pursuant to
this Plan, including the exercise price, the term of the Stock Options, the
number of shares subject to the Stock Option and the date or dates upon which
they become exercisable, shall be determined by the Committee.

 

(ii)                                  Stock Appreciation Right.  An Employee
Award may consist of a right to receive a payment, in cash or Common Stock,
equal to the excess of the Fair Market Value or other specified valuation of a
specified number of shares of Common Stock on the date the Stock Appreciation
Right is exercised over a specified strike price (which may be no less than the
Fair Market Value of the Common Stock on the date of grant) as set forth in the
applicable Award Agreement. The holder of a tandem SAR may elect to exercise
either the option or the SAR, but not both. The exercise period for an SAR shall
extend no more than 10 years after the date of grant; provided, however, if the
term of an SAR expires when trading in the Common Stock is prohibited by law or
the Company’s insider trading policy, then the term of such SAR shall expire on
the 30th day after the expiration of such prohibition. Unless otherwise provided
in the applicable Award Agreement, upon the expiration of the term of a SAR (as
extended, if applicable, by the previous sentence) if the SAR remains
unexercised and the exercise price is less than the Fair Market Value of a share
of Common Stock then the SAR will be automatically exercised.  SARs may not
include provisions that “reload” the SAR upon exercise. Subject to the foregoing
provisions, the terms, conditions and limitations applicable to any SARs awarded
to Employees pursuant to this Plan, including the exercise price, the term of
any SARs and the date or dates upon which they become exercisable, shall be
determined by the Committee.

 

(iii)                               Stock Award.  An Employee Award may be in
the form of a Stock Award. The terms, conditions and limitations applicable to
any Stock Awards

 

7

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

 

granted pursuant to this Plan shall be determined by the Committee, subject to
the limitations set forth below.

 

(iv)                              Cash Award.  An Employee Award may be in the
form of a Cash Award. The terms, conditions and limitations applicable to any
Cash Awards granted pursuant to this Plan shall be determined by the Committee.

 

(v)                                 Performance Award.  Without limiting the
type or number of Awards that may be made under the other provisions of this
Plan, an Award may be in the form of a Performance Award. The terms, conditions
and limitations applicable to any Performance Awards granted to Participants
pursuant to this Plan shall be determined by the Committee, subject to the
limitations set forth below. The Committee shall set Performance Goals in its
discretion which, depending on the extent to which they are met, will determine
the value and/or amount of Performance Awards that will be paid out to the
Participant and/or the portion of an Award that may be exercised.

 

(A)                               Nonqualified Performance Awards.  Performance
Awards granted to Employees that are not intended to qualify as qualified
performance-based compensation under Section 162(m) of the Code, or that are
Stock Options or SARs, shall be based on achievement of such goals and be
subject to such terms, conditions and restrictions as the Committee or its
delegate shall determine.

 

(B)                               Qualified Performance Awards.  Performance
Awards granted to Employees under the Plan that are intended to qualify as
Qualified Performance Awards shall be paid, vested or otherwise deliverable
solely on account of the attainment of one or more pre-established, objective
Performance Goals established by the Committee prior to the earlier to occur of
(x) 90 days after the commencement of the period of service to which the
Performance Goal relates and (y) the lapse of 25% of the period of service (as
scheduled in good faith at the time the goal is established), and in any event
while the outcome is substantially uncertain. A Performance Goal is objective if
a third party having knowledge of the relevant facts could determine whether the
goal is met. Such a Performance Goal may be based on one or more business
criteria that apply to the Employee, one or more business units, divisions or
geographic regions of the Company, the Company as a whole, or, if desired by the
Committee, by comparison to a peer group of companies, and shall include one or
more of the following: revenue, net income, net income per share, stock price,
market share, earnings per share, other earnings measures, return on equity,
return on assets, return on net assets, costs, stockholder value, EBIT, EBITDA,
funds from operations, cash flow, cash flow from operations, increase in cash
flow, increase in cash flow from operations, increase in cash flow return, net
cash flow, net cash flow before financing activities, other cash flow measures,
economic value added, total stockholder return, return on capital, return on
invested capital, return on investment, operating income, operating margin,
after-tax operating income, debt reduction, internal rate of return, capital
efficiency, reserve additions, proceeds from dispositions, production volumes,
increase in production, reserve replacement

 

8

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

 

measures, finding and development costs, total market value, petroleum reserve
measures and safety and environmental performance measures. Unless otherwise
stated, such a Performance Goal need not be based upon an increase or positive
result under a particular business criterion and could include, for example,
maintaining the status quo or limiting economic losses (measured, in each case,
by reference to specific business criteria). In interpreting Plan provisions
applicable to Performance Goals and Qualified Performance Awards, it is the
intent of the Plan to conform with the standards of Section 162(m) of the Code
and Treasury Regulation § 1.162-27(e)(2)(i), as to grants to those Employees
whose compensation is, or is likely to be, subject to Section 162(m) or the
Code, and the Committee in establishing such goals and interpreting the Plan
shall be guided by such provisions. Prior to the payment of any compensation
based on the achievement of Performance Goals applicable to Qualified
Performance Awards, the Committee must certify in writing that applicable
Performance Goals and any of the material terms thereof were, in fact,
satisfied. For this purpose, approved minutes of the Committee meeting in which
the certification is made shall be treated as such written certification.
Subject to the foregoing provisions, the terms, conditions and limitations
applicable to any Qualified Performance Awards made pursuant to this Plan shall
be determined by the Committee.  The Committee may provide in any such
Performance Award that any evaluation of performance may include or exclude any
of the following events that occurs during a Performance Period: (a) asset
write-downs, (b) litigation or claim judgments or settlements, (c) the effect of
changes in tax laws, accounting principles, or other laws or provisions
affecting reported results, (d) any reorganization and restructuring programs,
(e) extraordinary items as described in FASB ASC Topic No. 360 and/or
nonrecurring, unusual or special items as described in management’s discussion
and analysis of financial condition and results of operations appearing in the
Company’s annual report to stockholders, Form 10-K or Form 10-Q for the
applicable period, (f) acquisitions or divestitures, (g) foreign exchange gains
and losses and (h) settlement of hedging activities.  The amount of cash or
shares payable or vested pursuant to Awards that are intended to be Qualified
Performance Awards may not be adjusted upward; provided, however, that the
Committee may retain the discretion to adjust the amount of cash or shares
payable or vested pursuant to such Qualified Performance Awards downward, either
on a formula or discretionary basis or any combination, as the Committee
determines.

 

(b)                                 Notwithstanding anything to the contrary
contained in this Plan, the following limitations shall apply to any Awards made
hereunder:

 

(i)                                     no Participant may be granted, during
any calendar year, Awards consisting of Stock Options or Stock Appreciation
Rights (including Stock Options and SARs that are granted as Performance Awards)
that are exercisable for more than 5,000,000 shares of Common Stock;

 

(ii)                                  no Participant may be granted, during any
calendar year, Stock Awards (including Stock Awards that are granted as
Performance Awards)

 

9

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

 

covering or relating to more than 2,000,000 shares of Common Stock (the
limitation set forth in this clause (ii), together with the limitation set forth
in clause (i) above,

 

(iii)                               no Participant may be granted Employee
Awards consisting of cash (including Cash Awards that are granted as Performance
Awards) in respect of any calendar year having a value determined on the date of
grant in excess of $20,000,000.

 

A Participant may be granted Awards in combination such that portions of the
Award are subject to differing limitations set out in the clauses of this
Paragraph 7(b), in which event each portion of the combination Award is subject
only to a single appropriate limitation in clauses (i), (ii) or (iii). For
example, if a Participant is granted a Performance Award that is in part a Stock
Award and in part a Cash Award, then the Stock Award shall be subject only to
the limitation in clause (ii) and the Cash Award shall be subject only to the
limitation in clause (iii).

 

(c)                                  Subject to Paragraph 7(d), the Committee
shall have the sole responsibility and authority to determine the type or types
of Consultant Awards to be made under this Plan and the terms, conditions and
limitations applicable to such Awards.

 

(d)                                 Stock Awards, other than those awards which
are subject to specific grant limitations under the Plan, shall be in lieu of,
and have a Fair Market Value on the date of grant equal to, other compensation
that the Company would otherwise have awarded to the Participant.

 

8.                                      Director Awards.

 

(a)                                 The Board may grant Director Awards to
Nonemployee Directors of the Company from time to time in accordance with this
Paragraph 8. Director Awards may consist of those listed in this Paragraph 8 and
may be granted singly, in combination or in tandem. Each Director Award may, in
the discretion of the Board, be embodied in an Award Agreement, which shall
contain such terms, conditions and limitations as shall be determined by the
Board in its sole discretion and, if required by the Board, shall be signed by
the Participant to whom the Director Award is granted and signed for and on
behalf of the Company.

 

(i)                                     Stock Options.  A Director Award may
consist of a right to purchase a specified number of shares of Common Stock at a
specified price that is not less than the greater of (i) the Fair Market Value
of the Common Stock on the date of grant and (ii) the par value of the Common
Stock on the date of grant. A Stock Option granted as a Director Award may not
be in the form of an Incentive Stock Option. The term of the Stock Option shall
extend no more than 10 years after the date of grant; provided, however, if the
term of a Stock Option expires when trading in the Common Stock is prohibited by
law or the Company’s insider trading policy, then the term of such Stock Option
shall expire on the 30th day after the expiration of such prohibition.  Unless
otherwise

 

10

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

 

provided in the applicable Award Agreement, upon the expiration of the term of a
Stock Option (as extended, if applicable, by the previous sentence) if the Stock
Option remains unexercised and the exercise price is less than the Fair Market
Value of a share of Common Stock, then the Stock Option shall automatically be
exercised by means of a cashless exercise method approved by the Committee. 
Stock Options may not include provisions that “reload” the Stock Option upon
exercise. Subject to the foregoing provisions, the terms, conditions and
limitations applicable to any Stock Options awarded to Nonemployee Directors
pursuant to this Plan, including the strike price, the term of the Stock
Options, the number of share subject to the Stock Option (subject to Paragraph
8(b)) and the date or dates upon which they become exercisable, shall be
determined by the Board.

 

(ii)                                  Stock Awards.  A Director Award may be in
the form of a Stock Award. Any terms, conditions and limitations applicable to
any Stock Awards granted to a Nonemployee Director pursuant to this Plan,
including but not limited to rights to dividend equivalents, shall be determined
by the Board.

 

(b)                                 No Participant may be granted, during any
calendar year, Director Awards consisting of Stock Awards or Stock Options
covering or relating to more than 84,000 shares of Common Stock.

 

(c)                                  At the discretion of the Board, Director
Awards may be settled by a cash payment in an amount that the Board shall
determine in its sole discretion is equal to the fair market value of such
Director Awards.

 

9.                                      Payment of Awards.

 

(a)                                 General.  Payment of Awards may be made in
the form of cash or Common Stock or combinations thereof and may include such
restrictions as the Committee shall determine, including in the case of Common
Stock, restrictions on transfer and forfeiture provisions. If such payment is
made in the form of Restricted Stock, the Committee shall specify whether the
underlying shares are to be issued at the beginning or end of the Restriction
Period. In the event that shares of Restricted Stock are to be issued at the
beginning of the Restriction Period, the certificates evidencing such shares (to
the extent that such shares are so evidenced) shall contain appropriate legends
and restrictions that describe the terms and conditions of the restrictions
applicable thereto. In the event that shares of Restricted Stock are to be
issued at the end of the Restriction Period, the right to receive such shares
shall be evidenced by book entry registration or in such other manner as the
Committee may determine.

 

(b)                                 Deferral.  With the approval of the
Committee, amounts payable in respect of Awards may be deferred, either in the
form of installments or a future lump sum payment. The Committee may permit
selected Participants to elect to defer payments of some or all types of Awards
in accordance with procedures established by the Committee or the Board. Any
deferred payment, whether elected by the Participant or specified by the Award
Agreement or by the Committee, may be forfeited if and to the extent that the
Award Agreement so provides.

 

11

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

 

(c)                                  Dividends, Earnings and Interest. 
Dividends or dividend equivalent rights may be extended to and made part of any
Stock Award, subject to such terms, conditions and restrictions as the Committee
may establish; provided, however, that no such dividends or dividend equivalents
shall be paid with respect to unvested Stock Awards, including Stock Awards
subject to Performance Goals, but may, in the discretion of the Committee, be
accrued and paid to the Participant at the time that such Stock Award vests. 
The Committee may also establish rules and procedures for the crediting of
interest or other earnings on deferred cash payments. Dividends and/or dividend
equivalents shall not be paid with respect to any Stock Options or SARs.

 

(d)                                 Substitution of Awards.  Subject to
Paragraphs 12 and 15, at the discretion of the Committee, a Participant who is
an Employee or Consultant may be offered an election to substitute an Employee
Award or Consultant Award for another Employee Award or Consultant Award or
Employee Awards or Consultant Awards of the same or different type.

 

(e)                                  Cash-out of Awards.  At the discretion of
the Committee, an Award that is a Stock Option or Stock Appreciation Right may
be settled by a cash payment equal to the difference between the Fair Market
Value per share of Common Stock on the date of exercise and the exercise price
of the Award, multiplied by the number of shares with respect to which the Award
is exercised.

 

10.                               Stock Option Exercise.  The price at which
shares of Common Stock may be purchased under a Stock Option shall be paid in
full at the time of exercise in cash or, if permitted by the Committee and
elected by the optionee, the optionee may purchase such shares by means of
tendering Common Stock or surrendering another Award, including Restricted
Stock, valued at Fair Market Value on the date of exercise, or any combination
thereof.

 

The Committee shall determine acceptable methods for Participants who are
Employees or Consultants to tender Common Stock or other Employee Awards or
Consultant Awards to exercise a Stock Option as it deems appropriate. If
permitted by the Committee, payment may be made by successive exercises by the
Participant or by a net exercise or cashless exercise procedures.  The Committee
may provide for procedures to permit the exercise or purchase of such Awards by
use of the proceeds to be received from the sale of Common Stock issuable
pursuant to an Award. The Committee may adopt additional rules and procedures
regarding the exercise of Options from time to time, provided that such
rules and procedures are not inconsistent with the provisions of this Paragraph
10.

 

An optionee desiring to pay the exercise price of a Stock Option by tendering
Common Stock using the method of attestation may, subject to any such conditions
and in compliance with any such procedures as the Committee may adopt, do so by
attesting to the ownership of Common Stock of the requisite value in which case
the Company shall issue or otherwise deliver to the optionee upon such exercise
a number of shares of Common Stock subject to the Stock Option equal to the
result obtained by dividing (a) the excess of the aggregate Fair Market Value of
the shares of Common Stock subject to the Stock Option for which the Stock
Option (or portion thereof) is being exercised over the exercise price payable
in respect of such exercise by

 

12

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

 

(b) the Fair Market Value per share of Common Stock subject to the Stock Option,
and the optionee may retain the shares of Common Stock the ownership of which is
attested.

 

11.                               Taxes.  The Company or its designated third
party administrator shall have the right to deduct applicable taxes from any
Award payment and withhold, at the time of delivery or vesting of cash or shares
of Common Stock under this Plan, an appropriate amount of cash or number of
shares of Common Stock or a combination thereof for payment of taxes or other
amounts required by law or to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for withholding of such taxes;
provided, however, that, unless otherwise determined by the Committee in
response to a change in accounting rules, the number of shares of Common Stock
withheld for payment of required withholding taxes must equal no more than the
required minimum withholding taxes. The Committee may also permit withholding to
be satisfied by the transfer to the Company of shares of Common Stock
theretofore owned by the holder of the Employee Award with respect to which
withholding is required. If shares of Common Stock are used to satisfy tax
withholding, such shares shall be valued based on the Fair Market Value when the
tax withholding is required to be made.

 

12.                               Amendment, Modification, Suspension or
Termination.  The Board may amend, modify, suspend or terminate this Plan for
the purpose of meeting or addressing any changes in legal requirements or for
any other purpose permitted by law except that (i) no amendment or alteration
that would materially and adversely affect the rights of any Participant under
any Award previously granted to such Participant shall be made without such
Participant’s consent and (ii) no amendment or alteration shall be effective
prior to approval by the Company’s stockholders to the extent such approval is
required by applicable legal requirements or applicable requirements of the
securities exchange on which the Company’s Common Stock is listed.
Notwithstanding anything herein to the contrary, except as expressly provided by
the adjustment provisions of Paragraph 15, without the approval of the Company’s
stockholders, Stock Options and SARs issued under the Plan will not be
(i) repriced, replaced, or regranted through cancellation or by decreasing the
exercise price of a previously granted Stock Option or SAR or (ii) canceled in
exchange for cash or other Awards or Stock Options or SARs with an exercise
price that is less than the exercise price of the original Stock Options or
SARs.

 

13.                               Termination of Employment.  Upon the
termination of employment by a Participant, any unexercised, deferred or unpaid
Awards shall be treated as provided in the specific Award Agreement evidencing
the Award. In the event of such a termination, the Committee may, in its
discretion, provide for the extension of the exercisability of an Award,
accelerate the vesting or exercisability of an Award, eliminate or make less
restrictive any restrictions contained in an Award, waive any restriction or
other provision of this Plan or an Award or otherwise amend or modify the Award
in any manner that is either (i) not materially adverse to such Participant or
(ii) consented to by such Participant.

 

14.                               Assignability.  Unless otherwise determined by
the Committee and provided in the Award Agreement or the terms of an Award, no
Award or any other benefit under this Plan shall be assignable or otherwise
transferable except by will, by beneficiary designation or the laws of descent
and distribution or pursuant to a qualified domestic relations order as defined
by the Code or Title I of the Employee Retirement Income Security Act, or the

 

13

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

 

rules thereunder. In the event that a beneficiary designation conflicts with an
assignment by will, the beneficiary designation will prevail. The Committee may
prescribe and include in applicable Award Agreements or the terms of an Award
other restrictions on transfer. Any attempted assignment of an Award or any
other benefit under this Plan in violation of this Paragraph 14 shall be null
and void.

 

15.                               Adjustments.

 

(a)                                 The existence of outstanding Awards shall
not affect in any manner the right or power of the Company or its stockholders
to make or authorize any or all adjustments, recapitalizations, reorganizations
or other changes in the capital stock of the Company or its business or any
merger or consolidation of the Company, or any issue of bonds, debentures,
preferred or prior preference stock (whether or not such issue is prior to, on a
parity with or junior to the Common Stock) or the dissolution or liquidation of
the Company, or any sale or transfer of all or any part of its assets or
business, or any other corporate act or proceeding of any kind, whether or not
of a character similar to that of the acts or proceedings enumerated above.

 

(b)                                 In the event of any subdivision or
consolidation of outstanding shares of Common Stock, declaration of a dividend
payable in shares of Common Stock or other stock split, then (i) the number of
shares of Common Stock reserved under this Plan and the number of shares of
Common Stock available for issuance pursuant to specific types of Awards as
described in Paragraph 4, (ii) the number of shares of Common Stock covered by
outstanding Awards in the form of Common Stock or units denominated in Common
Stock, (iii) the exercise price or other price in respect of such Awards,
(iv) the appropriate Fair Market Value and other price determinations for such
Awards, and (v) the Stock Based Awards Limitations shall each be proportionately
adjusted by the Committee as appropriate to reflect such transaction. In the
event of any other recapitalization or capital reorganization of the Company,
any consolidation or merger of the Company with another corporation or entity,
the adoption by the Company of any plan of exchange affecting the Common Stock
or any distribution to holders of Common Stock of securities or property
(including cash dividends that the Committee determines are not in the ordinary
course of business but excluding normal cash dividends or dividends payable in
Common Stock), the Committee shall make appropriate adjustments to (i) the
number of shares of Common Stock reserved under this Plan and the number of
shares of Common Stock available for issuance pursuant to specific types of
Awards as described in Paragraph 4, (ii) the number and kind of shares of Common
Stock covered by outstanding Awards in the form of Common Stock or units
denominated in Common Stock, (iii) the exercise price or other price in respect
of such Awards, (iv) the appropriate Fair Market Value and other price
determinations for such Awards, and (v) the Stock Based Awards Limitations to
reflect such transaction; provided that such adjustments shall only be such as
are necessary to maintain the proportionate interest of the holders of the
Awards and preserve, without increasing, the value of such Awards.

 

(c)                                  In the event of a corporate merger,
consolidation, acquisition of property or stock, separation, reorganization or
liquidation, the Committee may make such adjustments to Awards or other
provisions for the disposition of Awards as it deems

 

14

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

 

equitable, and shall be authorized, in its discretion, (i) to provide for the
substitution of a new Award or other arrangement (which, if applicable, may be
exercisable for such property or stock as the Committee determines) for an Award
or the assumption of the Award, regardless of whether in a transaction to which
Section 424(a) of the Code applies, (ii) to provide, prior to the transaction,
for the acceleration of the vesting and exercisability of, or lapse of
restrictions with respect to, the Award and, if the transaction is a cash
merger, provide for the termination of any portion of the Award that remains
unexercised at the time of such transaction, or (iii) to cancel any such Awards
and to deliver to the Participants cash in an amount that the Committee shall
determine in its sole discretion is equal to the Fair Market Value of such
Awards on the date of such event, which in the case of Stock Options or SARs
shall be the excess (if any) of the Fair Market Value of Common Stock on such
date over the exercise or strike price of such Award.

 

(d)                                 No adjustment or substitution pursuant to
this Paragraph 15 shall be made in a manner that results in noncompliance with
the requirements of Section 409A of the Code, to the extent applicable.

 

16.                               Restrictions.  No Common Stock or other form
of payment shall be issued with respect to any Award unless the Company shall be
satisfied based on the advice of its counsel that such issuance will be in
compliance with applicable federal and state securities laws. Certificates
evidencing shares of Common Stock delivered under this Plan (to the extent that
such shares are evidenced) may be subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the rules, regulations
and other requirements of the Securities and Exchange Commission, any securities
exchange or transaction reporting system upon which the Common Stock is then
listed or to which it is admitted for quotation and any applicable federal or
state securities law. The Committee may cause a legend or legends to be placed
upon any such certificates to make appropriate reference to such restrictions.

 

17.                               Unfunded Plan.  This Plan shall be unfunded.
Although bookkeeping accounts may be established with respect to Participants
under this Plan, any such accounts shall be used merely as a bookkeeping
convenience, including bookkeeping accounts established by a third party
administrator retained by the Company to administer the Plan. The Company shall
not be required to segregate any assets for purposes of this Plan or Awards
hereunder, nor shall the Company nor the Board nor the Committee be deemed to be
a trustee of any benefit under this Plan. Any liability or obligation of the
Company to any Participant with respect to a an Award under this Plan shall be
based solely upon any contractual obligations that may be created by this Plan
and any Award Agreement or terms of the Award, and no such liability or
obligation of the Company shall be deemed to be secured by any pledge or other
encumbrance on any property of the Company. Neither the Company nor the Board
nor the Committee shall be required to give any security or bond for the
performance of any obligation that may be created by this Plan.

 

18.                               Right to Continued Service or Employment. 
Nothing in the Plan or an Award Agreement shall interfere with or limit in any
way the right of the Company to terminate any Participant’s employment or other
service relationship at any time, or confer upon any Participant any right to
continue in the capacity in which he or she is employed or otherwise serves the
Company.

 

15

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

 

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

 

20.                               Governing Law.  This Plan and all
determinations made and actions taken pursuant hereto, to the extent not
otherwise governed by mandatory provisions of the Code or the securities laws of
the United States, shall be governed by and construed in accordance with the
laws of the State of Delaware.

 

21.                               Effective Date and Term of Plan.  The Plan
will be submitted to the stockholders of the Company for approval at the 2014
annual meeting of the stockholders and, if approved, shall be effective as of
the date of such approval. No Award shall be made under the Plan ten years or
more after such approval. As of the date of stockholder approval of this Plan,
no further awards shall be made under the Prior Plans, provided, however, that
any and all outstanding awards granted under the Prior Plans shall continue to
be outstanding and shall be subject to the appropriate terms of the Prior Plan
under which such award was granted and as are in effect as of the date this Plan
is effective.

 

22.                               Clawback.  To the extent required by
applicable law or any applicable securities exchange listing standards, or as
otherwise determined by the Committee, Awards and amounts paid or payable
pursuant to or with respect to Awards shall be subject to the provisions of any
clawback policy implemented by the Company, which clawback policy may provide
for forfeiture, repurchase and/or recoupment of Awards and amounts paid or
payable pursuant to or with respect to Awards.  Notwithstanding any provision of
this Plan or any Award Agreement to the contrary, the Company reserves the
right, without the consent of any Participant, to adopt any such clawback
policies and procedures, including such policies and procedures applicable to
this Plan or any Award Agreement with retroactive effect.

 

23.                               Section 409A.

 

(a)                                 Awards made under this Plan are intended to
comply with or be exempt from Section 409A of the Code, and ambiguous provisions
hereof, if any, shall be construed and interpreted in a manner consistent with
such intent.  No payment, benefit or consideration shall be substituted for an
Award if such action would result in the imposition of taxes under Section 409A
of the Code.  Notwithstanding anything in this Plan to the contrary, if any Plan
provision or Award under this Plan would result in the imposition of an
additional tax under Section 409A of the Code, that Plan provision or Award
shall be reformed, to the extent permissible under Section 409A of the Code, to
avoid imposition of the additional tax, and no such action shall be deemed to
adversely affect the Participant’s rights to an Award.

 

(b)                                 Unless the Committee provides otherwise in
an Award Agreement, each Restricted Stock Unit (including a Restricted Stock
Unit that is a Performance Award) or Cash Award (or portion thereof if the Award
is subject to a vesting schedule) shall be settled no later than the 15th day of
the third month after the end of the first calendar year in which the Award (or
such portion thereof) is no longer subject to a “substantial risk of

 

16

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

 

forfeiture” within the meaning of Section 409A of the Code.  If the Committee
determines that a Restricted Stock Unit (including a Restricted Stock Unit that
is a Performance Award) or Cash Award is intended to be subject to Section 409A
of the Code, the applicable Award Agreement shall include terms that are
designed to satisfy the requirements of Section 409A of the Code.

 

(c)                                  If the Participant is identified by the
Company as a “specified employee” within the meaning of
Section 409A(a)(2)(B)(i) of the Code on the date on which the Participant has a
“separation from service” (other than due to death) within the meaning of
Treasury Regulation § 1.409A-1(h), any Award payable or settled on account of a
separation from service that is deferred compensation subject to Section 409A of
the Code shall be paid or settled on the earliest of (1) the first business day
following the expiration of six months from the Participant’s separation from
service, (2) the date of the Participant’s death, or (3) such earlier date as
complies with the requirements of Section 409A of the Code.

 

17

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