Exhibit 10.10

 

B. RILEY PRINCIPAL MERGER CORP. II 2020 INCENTIVE PLAN

 

1. Establishment of the Plan; Effective Date; Duration.

 

(a) Establishment of the Plan; Effective Date. B. Riley Principal Merger Corp.
II, a Delaware corporation (the “Company”), hereby establishes this incentive
compensation plan to be known as the “B. Riley Principal Merger Corp. II 2020
Incentive Plan,” as amended from time to time (the “Plan”). The Plan permits the
grant of Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation
Rights, Restricted Stock, Restricted Stock Units, Other Stock-Based Awards,
Other Cash-Based Awards and Dividend Equivalents. If the Plan is not so approved
by the stockholders of the Company, then the Plan will be null and void in its
entirety. The Plan shall remain in effect as provided in Section 1(b) of the
Plan. Capitalized but undefined terms shall have the meaning set forth in
Section 3 of the Plan.

 

(b) Duration of the Plan. The Plan shall commence on the Effective Date and
shall remain in effect, subject to the right of the Board to amend or terminate
the Plan at any time pursuant to Section 13. However, in no event may an Award
be granted under the Plan on or after ten years from the Effective Date.

 

2. Purpose. The purpose of the Plan is to provide a means through which the
Company and its Affiliates may attract and retain key personnel and to provide a
means whereby certain directors, officers, employees, consultants and advisors
(and certain prospective directors, officers, employees, consultants, and
advisors) of the Company and its Affiliates can acquire and maintain an equity
interest in the Company, or be paid incentive compensation, which may be
measured by reference to the value of Common Stock, thereby strengthening their
commitment to the welfare of the Company and its Affiliates and aligning their
interests with those of the Company’s stockholders.

 

3. Definitions. Certain terms used herein have the definitions given to them in
the first instance in which they are used. In addition, for purposes of the
Plan, the following terms are defined as set forth below:

 

(a) “Affiliate” means (i) any person or entity that directly or indirectly
controls, is controlled by or is under common control with the Company and/or
(ii) to the extent provided by the Committee, any person or entity in which the
Company has a significant interest. The term “control” (including, with
correlative meaning, the terms “controlled by” and “under common control with”),
as applied to any person or entity, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such person or entity, whether through the ownership of voting or
other securities, by contract or otherwise.

 

(b) “Applicable Laws” means the requirements relating to the administration of
equity incentive plans under U.S. federal and state securities, tax and other
applicable laws, rules and regulations, the applicable rules of any stock
exchange or quotation system on which the Common Stock are listed or quoted, and
the applicable laws and rules of any foreign country or other jurisdiction where
Awards are granted, as are in effect from time to time.

 

(c) “Award” means, individually or collectively, any Incentive Stock Option,
Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock,
Restricted Stock Unit, Other Stock-Based Awards, Other Cash-Based Awards, and/or
Dividend Equivalents, granted under the Plan.

 

(d) “Award Agreement” means a written agreement between a Participant and the
Company which sets out the terms of the grant of an Award.

 

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

 

(f) “Cause” means, in the case of a particular Award, unless the applicable
Award Agreement states otherwise, (i) the Company or an Affiliate having “cause”
to terminate a Participant’s employment or service, as defined in any employment
or consulting or similar agreement between the Participant and the Company or an
Affiliate in effect at the time of such termination, or (ii) in the absence of
any such employment or consulting or similar agreement (or the absence of any
definition of  “Cause” contained therein), a Participant’s (A) conviction of, or
the entry of a plea of guilty or no contest to, a felony or any other crime that
causes the Company or its Affiliates public disgrace or disrepute, or materially
and adversely affects the Company’s or its Affiliates’ operations or financial
performance or the relationship the Company has with its customers; (B) gross
negligence or willful misconduct with respect to the Company or any of its
Affiliates, including, without limitation, fraud, embezzlement, theft or proven
dishonesty in the course of his employment or other service to the Company or an
Affiliate; (C) alcohol abuse or use of controlled substances other than in
accordance with a physician’s prescription; (D) refusal to perform any lawful,
material obligation or fulfill any duty (other than any duty or obligation of
the type described in clause (F) below) to the Company or its Affiliates (other
than due to a disability, as determined by the Committee), which refusal, if
curable, is not cured within 15 days after delivery of written notice thereof;
(E) material breach of any agreement with or duty owed to the Company or any of
its Affiliates, which breach, if curable, is not cured within 15 days after the
delivery of written notice thereof; or (F) any breach of any obligation or duty
to the Company or any of its Affiliates (whether arising by statute, common law
or agreement) relating to confidentiality, noncompetition, nonsolicitation
and/or proprietary rights.

 

(g) “Change in Control” shall, in the case of a particular Award, unless the
applicable Award Agreement states otherwise or contains a different definition
of “Change in Control,” be deemed to occur upon any of the following events:

 

(i) any “person” as such term is used in Sections 13(d) and 14(d) of the
Exchange Act (other than (A) the Company or any of its Affiliates, (B) any
trustee or other fiduciary holding securities under any employee benefit plan of
the Company or any of its Affiliates, (C) an underwriter temporarily holding
securities pursuant to an offering of such securities, or (D) an entity owned,
directly or indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of Common Stock) becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, by way of merger, consolidation, recapitalization, reorganization or
otherwise, of fifty percent (50%) or more of the total voting power of the then
outstanding voting securities of the Company;

 

(ii) the cessation of control (by virtue of their not constituting a majority of
directors) of the Board by the individuals (the “Continuing Directors”) who (x)
were directors on the Effective Date or (y) become directors after Effective
Date and whose election or nomination for election by the Company’s stockholders
was approved by a vote of at least two-thirds of the directors then in office
who were directors on the Effective Date or whose election or nomination for
election was previously so approved;

 

(iii) the consummation of a merger or consolidation of the Company with any
other company, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) at least fifty percent (50%) of
the total voting power represented by the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation;

 

(iv) the consummation of a plan of complete liquidation of the Company or the
sale or disposition by the Company of all or substantially all the Company’s
assets; or

 

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(v) any other event specified as a “Change in Control” in an applicable Award
Agreement.

 

Notwithstanding the foregoing, if a Change in Control constitutes a payment
event with respect to any Award (or any portion of an Award) that provides for
the deferral of compensation that is subject to Section 409A of the Code, to the
extent required to avoid the imposition of additional taxes under Section 409A
of the Code, the transaction or event described in subsection (i), (ii), (iii),
(iv), or (v) with respect to such Award (or portion thereof) shall only
constitute a Change in Control for purposes of the payment timing of such Award
if such transaction also constitutes a “change in control event,” as defined in
Treasury Regulation Section 1.409A-3(i)(5).

 

(h) “Claim” means any claim, liability or obligation of any nature, arising out
of or relating to the Plan or an alleged breach of the Plan or an Award
Agreement.

 

(i) “Code” means the Internal Revenue Code of 1986, as amended, and any
successor thereto. Reference in the Plan to any section of the Code shall be
deemed to include any regulations or other interpretative guidance under such
section, and any amendments or successor provisions to such section, regulations
or guidance.

 

(j) “Committee” means a committee of at least two people as the Board may
appoint to administer the Plan or, if no such committee has been appointed by
the Board, the Board.

 

(k) “Common Stock” means the Class A common stock of the Company, par value
$0.0001 per share.

 

(l) “Company” means B. Riley Principal Merger Corp. II, a Delaware corporation.

 

(m) “Date of Grant” means the date on which the granting of an Award is
authorized, or such other date as may be specified in such authorization or
applicable Award Agreement.

 

(n) “Dividend Equivalent” means a right awarded under Section 11 to receive the
equivalent value (in cash or Common Stock) of ordinary dividends that would
otherwise be paid on the Common Stock subject to an Award that is a full-value
award but that have not been issued or delivered.

 

(o) “Effective Date” means the later of (i) the date that the Company’s
stockholders approve the Plan and (ii) Closing.

 

(p) “Eligible Director” means a person who is a “non-employee director” within
the meaning of Rule 16b-3 under the Exchange Act.

 

(q) “Eligible Person” with respect to an Award denominated in Common Stock,
means any (i) individual employed by the Company or an Affiliate; (ii) director
of the Company or an Affiliate; (iii) consultant or advisor to the Company or an
Affiliate; provided, that, if the Securities Act applies, such persons must be
eligible to be offered securities registrable on Form S-8 under the Securities
Act; or (iv) prospective employees, directors, officers, consultants or advisors
who have accepted offers of employment or consultancy from the Company or its
Affiliates (and would satisfy the provisions of clauses (i) through (iii) above
once he or she begins employment with or begins providing services to the
Company or its Affiliates, provided, that, the Date of Grant of any Award to
such individual shall not be prior to the date he begins employment with or
begins providing services to the Company or its Affiliates).

 

(r) “Exchange Act” means the U.S. Securities Exchange Act of 1934, as it may be
amended from time to time, including the rules and regulations promulgated
thereunder and successor provisions and rules and regulations thereto.

 

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(s) “Exercise Price” has the meaning given such term in Section 7(b) of the
Plan.

 

(t) “Fair Market Value” means, as of any date, the value of Common Stock
determined as follows:

 

(i) If the Common Stock are listed on any established stock exchange or a
national market system, the closing sales price for such shares (or the closing
bid, if no sales were reported) as quoted on such exchange or system on the day
of determination, as reported in The Wall Street Journal or such other source as
the Committee deems reliable;

 

(ii) If the Common Stock are regularly quoted by a recognized securities dealer
but selling prices are not reported, the Fair Market Value of a Common Share
will be the mean between the high bid and low asked prices for the Common Stock
on the day of determination, as reported in The Wall Street Journal or such
other source as the Committee deems reliable; or

 

(iii) In the absence of an established market for the Common Stock, the Fair
Market Value will be determined in good faith by the Committee (acting on the
advice of an Independent Third Party, should the Committee elect in its sole
discretion to utilize an Independent Third Party for this purpose).

 

(iv) Notwithstanding the foregoing, the determination of Fair Market Value in
all cases shall be in accordance with the requirements set forth under Section
409A of the Code to the extent necessary for an Award to comply with, or be
exempt from, Section 409A of the Code.

 

(u) “Immediate Family Members” shall have the meaning set forth in
Section 14(b)(ii).

 

(v) “Incentive Stock Option” means an Option that is designated by the Committee
as an incentive stock option as described in Section 422 of the Code and
otherwise meets the requirements set forth in the Plan for incentive stock
options.

 

(w) “Indemnifiable Person” shall have the meaning set forth in Section 4(e) of
the Plan.

 

(x) “Independent Third Party” means an individual or entity independent of the
Company having experience in providing investment banking or similar appraisal
or valuation services and with expertise generally in the valuation of
securities or other property for purposes of this Plan. The Committee may
utilize one or more Independent Third Parties.

 

(y) “Mature Shares” means Common Stock owned by a Participant that are not
subject to any pledge or security interest and that have been either previously
acquired by the Participant on the open market or meet such other requirements,
if any, as the Committee may determine are necessary in order to avoid an
accounting earnings charge on account of the use of such shares to pay the
Exercise Price or satisfy a tax or deduction obligation of the Participant.

 

(z) “Nonqualified Stock Option” means an Option that is not designated by the
Committee as an Incentive Stock Option.

 

(aa) “Option” means an Award granted under Section 7 of the Plan.

 

(bb) “Option Period” has the meaning given such term in Section 7(c) of the
Plan.

 

(cc) “Other Cash-Based Award” means a cash Award granted to a Participant under
Section 10 of the Plan, including cash awarded as a bonus or upon the attainment
of performance goals or otherwise as permitted under the Plan.

 

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(dd) “Other Stock-Based Award” means an equity-based or equity-related Award,
other than an Option, SAR, Restricted Stock, Restricted Stock Unit or Dividend
Equivalent, granted in accordance with the terms and conditions set forth under
Section 10 of the Plan (including upon the attainment of any performance goals
or otherwise as permitted under the Plan).

 

(ee) “Participant” means an Eligible Person who has been selected by the
Committee to participate in the Plan and to receive an Award pursuant to
Section 6 of the Plan.

 

(ff)  “Permitted Transferee” shall have the meaning set forth in
Section 14(b)(ii) of the Plan.

 

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

 

(hh) “Plan” means this B. Riley Principal Merger Corp. II 2020 Incentive Plan,
as amended from time to time.

 

(ii) “Restricted Period” means the period of time determined by the Committee
during which an Award is subject to restrictions or, as applicable, the period
of time within which performance is measured for purposes of determining whether
an Award has been earned.

 

(jj) “Restricted Stock Unit” means an unfunded and unsecured promise to deliver
Common Stock, cash, other securities or other property, subject to certain
performance or time-based restrictions (including, without limitation, a
requirement that the Participant remain continuously employed, provide
continuous services for a specified period of time, or attain specified
performance objectives), granted under Section 9 of the Plan.

 

(kk) “Restricted Stock” means Common Stock, subject to certain specified
performance or time-based restrictions (including, without limitation, a
requirement that the Participant remain continuously employed, provide
continuous services for a specified period of time, or attain specified
performance objectives), granted under Section 9 of the Plan.

 

(ll)  “SAR Period” has the meaning given such term in Section 8(c) of the Plan.

 

(mm) “Securities Act” means the Securities Act of 1933, as amended, and any
successor thereto. Reference in the Plan to any section of the Securities Act
shall be deemed to include any rules, regulations or other interpretative
guidance under such section, and any amendments or successor provisions to such
section, rules, regulations or guidance.

 

(nn) “Stock Appreciation Right” or “SAR” means an Award granted under Section 8
of the Plan.

 

(oo) “Strike Price” means, except as otherwise provided by the Committee in the
case of Substitute Awards, (i) in the case of a SAR granted in tandem with an
Option, the Exercise Price of the related Option, or (ii) in the case of a SAR
granted independent of an Option, the Fair Market Value on the Date of Grant.

 

(pp) “Subsidiary” means, with respect to any specified Person:

 

(i) any corporation, association or other business entity of which more than 50%
of the total voting power of shares (without regard to the occurrence of any
contingency and after giving effect to any voting agreement or stockholders’
agreement that effectively transfers voting power) is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person (or a combination thereof); and

 

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(ii) any partnership (or any comparable foreign entity (A) the sole general
partner (or functional equivalent thereof) or the managing general partner of
which is such Person or Subsidiary of such Person or (B) the only general
partners (or functional equivalents thereof) of which are that Person or one or
more Subsidiaries of that Person (or any combination thereof).

 

(qq) “Substitute Award” has the meaning given such term in Section 5(e).

 

4. Administration.

 

(a) The Committee shall administer the Plan. To the extent required to comply
with the provisions of Rule 16b-3 promulgated under the Exchange Act (if the
Board is not acting as the Committee under the Plan), it is intended that each
member of the Committee shall, at the time he takes any action with respect to
an Award under the Plan, be an Eligible Director. However, the fact that a
Committee member shall fail to qualify as an Eligible Director shall not
invalidate any Award granted by the Committee that is otherwise validly granted
under the Plan.

 

(b) Subject to the provisions of the Plan and Applicable Law, the Committee
shall have the sole and plenary authority, in addition to other express powers
and authorizations conferred on the Committee by the Plan, to: (i) designate
Participants; (ii) determine the type or types of Awards to be granted to a
Participant; (iii) determine the number of Common Stock to be covered by, or
with respect to which payments, rights, or other matters are to be calculated in
connection with, Awards; (iv) determine the terms and conditions of any Award
(including any performance goals, criteria, and/or periods applicable to
Awards); (v) determine whether, to what extent, and under what circumstances
Awards may be settled or exercised in cash, Common Stock, other securities,
other Awards or other property, or canceled, forfeited, or suspended and the
method or methods by which Awards may be settled, exercised, canceled,
forfeited, or suspended; (vi) determine whether, to what extent, and under what
circumstances the delivery of cash, Common Stock, other securities, other Awards
or other property and other amounts payable with respect to an Award shall be
deferred either automatically or at the election of the Participant or of the
Committee; (vii) interpret, administer, reconcile any inconsistency in, correct
any defect in and/or supply any omission in the Plan and any instrument or
agreement relating to, or Award granted under, the Plan, including any changes
required to comply with Applicable Laws; (viii) establish, amend, suspend, or
waive any rules and regulations and appoint such agents as the Committee shall
deem appropriate for the proper administration of the Plan; (ix) accelerate the
vesting or exercisability of, payment for or lapse of restrictions on, Awards;
(x) modify any performance goals, criteria and/or periods; and (y) make any
other determination and take any other action that the Committee deems necessary
or desirable for the administration of the Plan, in each case, to the extent
consistent with the terms of the Plan.

 

(c) The Committee may delegate to one or more officers of the Company or any
Affiliate the authority to act on behalf of the Committee with respect to any
matter, right, obligation, or election that is the responsibility of or that is
allocated to the Committee herein, and that may be so delegated as a matter of
law, except for grants of Awards to persons subject to Section 16 of the
Exchange Act.

 

(d) Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations, and other decisions under or with respect to
the Plan or any Award or any documents evidencing Awards granted pursuant to the
Plan shall be within the sole discretion of the Committee, may be made at any
time and shall be final, conclusive and binding upon all persons or entities,
including, without limitation, the Company, any Affiliate, any Participant, any
holder or beneficiary of any Award, and any stockholder of the Company.

 

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(e) No member of the Board, the Committee, delegate of the Committee or any
employee or agent of the Company (each such person, an “Indemnifiable Person”)
shall be liable for any action taken or omitted to be taken or any determination
made in good faith with respect to the Plan or any Award hereunder. Each
Indemnifiable Person shall be indemnified and held harmless by the Company
against and from any loss, cost, liability, or expense (including attorneys’
fees) that may be imposed upon or incurred by such Indemnifiable Person in
connection with or resulting from any action, suit or proceeding to which such
Indemnifiable Person may be a party or in which such Indemnifiable Person may be
involved by reason of any action taken or omitted to be taken under the Plan or
any Award Agreement and against and from any and all amounts paid by such
Indemnifiable Person with the Company’s approval, in settlement thereof, or paid
by such Indemnifiable Person in satisfaction of any judgment in any such action,
suit or proceeding against such Indemnifiable Person, provided that the Company
shall have the right, at its own expense, to assume and defend any such action,
suit or proceeding and once the Company gives notice of its intent to assume the
defense, the Company shall have sole control over such defense with counsel of
the Company’s choice. The foregoing right of indemnification shall not be
available to an Indemnifiable Person to the extent that a final judgment or
other final adjudication (in either case not subject to further appeal) binding
upon such Indemnifiable Person determines that the acts or omissions of such
Indemnifiable Person giving rise to the indemnification claim resulted from such
Indemnifiable Person’s bad faith, fraud or willful criminal act or omission or
that such right of indemnification is otherwise prohibited by law or by the
Company’s Articles of Incorporation or Bylaws. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such Indemnifiable Persons may be entitled under the Company’s Articles of
Incorporation or Bylaws, as a matter of law, or otherwise, or any other power
that the Company may have to indemnify such Indemnifiable Persons or hold them
harmless.

 

(f) Notwithstanding anything to the contrary contained in the Plan, the Board
may, in its sole discretion, at any time and from time to time, grant Awards and
administer the Plan with respect to such Awards. In any such case, the Board
shall have all the authority granted to the Committee under the Plan.

 

5. Grant of Awards; Shares Subject to the Plan; Limitations.

 

(a) The Committee may, from time to time, grant Awards to one or more Eligible
Persons.

 

(b) Subject to Section 12 of the Plan, Awards granted under the Plan shall be
subject to the following limitations: (i) the Committee is authorized to deliver
under the Plan an aggregate of 6,000,000 Common Stock (“Original Share
Reserve”); provided, that the total number of Common Stock that will be
reserved, and that may be issued, under the Plan will automatically increase on
the first trading day of each calendar year, beginning with calendar year 2021,
by a number of Common Stock equal to one percent (1%) of the total outstanding
Common Stock on the last day of the prior calendar year, and (ii) the maximum
number of Common Stock that may be granted under the Plan during any single
fiscal year to any Participant who is a non-employee director, when taken
together with any cash fees paid to such non-employee director during such year
in respect of his service as a non-employee director (including service as a
member or chair of any committee of the Board), shall not exceed $500,000 in
total value (calculating the value of any such Awards based on the Fair Market
Value on the Date of Grant of such Awards for financial reporting purposes);
provided that the non-employee directors who are considered independent (under
the rules of The New York Stock Exchange or other securities exchange on which
the Common Stock is traded) may make exceptions to this limit for a
non-executive chair of the Board, if any, in which case the non-employee
director receiving such additional compensation may not participate in the
decision to award such compensation. Notwithstanding the automatic annual
increase set forth in (i) above, the Board may act prior to January 1st of a
given year to provide that there will be no such increase in the share reserve
for such year or that the increase in the share reserve for such year will be a
lesser number of Common Stock than would otherwise occur pursuant to the
stipulated percentage.

 

(c) In the event that (i) any Option or other Award granted hereunder is
exercised through the tendering of Common Stock (either actually or by
attestation) or by the withholding of Common Stock by the Company, or (ii) tax
or deduction liabilities arising from such Option or other Award are satisfied
by the tendering of Common Stock (either actually or by attestation) or by the
withholding of Common Stock by the Company, then in each such case the Common
Stock so tendered or withheld shall be added to the Common Stock available for
grant under the Plan on a one-for-one basis. Shares underlying Awards under this
Plan that are forfeited, canceled, expire unexercised, or are settled in cash
shall also be available again for issuance as Awards under the Plan.

 

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(d) Common Stock delivered by the Company in settlement of Awards may be
authorized and unissued shares, shares held in the treasury of the Company,
shares purchased on the open market or by private purchase, or a combination of
the foregoing.

 

(e) Awards may, in the sole discretion of the Committee, be granted under the
Plan in assumption of, or in substitution for, outstanding awards previously
granted by an entity acquired by the Company or with which the Company combines
(“Substitute Awards”). The number of Common Stock underlying any Substitute
Awards shall not be counted against the aggregate number of Common Stock
available for Awards under the Plan.

 

6. Eligibility. Participation shall be limited to Eligible Persons who have
entered into an Award Agreement or who have received written notification from
the Committee, or from a person designated by the Committee, that they have been
selected to participate in the Plan.

 

7. Options.

 

(a) Generally. Each Option granted under the Plan shall be evidenced by an Award
Agreement (whether in paper or electronic medium (including email or the posting
on a web site maintained by the Company or a third party under contract with the
Company)). Each Option so granted shall be subject to the conditions set forth
in this Section 7 and to such other conditions not inconsistent with the Plan as
may be reflected in the applicable Award Agreement. All Options granted under
the Plan shall be Nonqualified Stock Options unless the applicable Award
Agreement expressly states that the Option is intended to be an Incentive Stock
Option. Subject to Section 12, the maximum aggregate number of Common Stock that
may be issued through the exercise of Incentive Stock Options granted under the
Plan is the number of Common Stock equal to the Original Share Reserve, which,
for the avoidance of doubt, such share limit shall not be subject to the annual
adjustment provided in Section 5(b)(i). Incentive Stock Options shall be granted
only to Eligible Persons who are employees of the Company and its Affiliates,
and no Incentive Stock Option shall be granted to any Eligible Person who is
ineligible to receive an Incentive Stock Option under the Code. No Option shall
be treated as an Incentive Stock Option unless the Plan has been approved by the
stockholder of the Company in a manner intended to comply with the stockholder
approval requirements of Section 422(b)(1) of the Code; provided that any Option
intended to be an Incentive Stock Option shall not fail to be effective solely
on account of a failure to obtain such approval, but rather such Option shall be
treated as a Nonqualified Stock Option unless and until such approval is
obtained. In the case of an Incentive Stock Option, the terms and conditions of
such grant shall be subject to and comply with such rules as may be prescribed
by Section 422 of the Code. If for any reason an Option intended to be an
Incentive Stock Option (or any portion thereof) shall not qualify as an
Incentive Stock Option, then, to the extent of such nonqualification, such
Option or portion thereof shall be regarded as a Nonqualified Stock Option
appropriately granted under the Plan.

 

(b) Exercise Price. Except with respect to Substitute Awards, the exercise price
(“Exercise Price”) per Common Share for each Option shall not be less than 100%
of the Fair Market Value of such share determined as of the Date of Grant;
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 shares representing
more than 10% of the total combined voting power of all classes of shares of the
Company or any related corporation (as determined in accordance with Treasury
Regulation Section 1.422-2(f)), the Exercise Price per share shall not be less
than 110% of the Fair Market Value per share on the Date of Grant and provided
further, that, notwithstanding any provision herein to the contrary, the
Exercise Price shall not be less than the par value per Common Share.

 

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(c) Vesting and Expiration. Options shall vest and become exercisable in such
manner and on such date or dates determined by the Committee (including, if
applicable, the attainment of any performance goals, as determined by the
Committee in the applicable Award Agreement) and shall expire after such period,
not to exceed ten years, as may be determined by the Committee (the “Option
Period”); provided, however, that the Option Period shall not exceed five years
from the Date of Grant in the case of an Incentive Stock Option granted to a
Participant who on the Date of Grant owns shares representing more than 10% of
the total combined voting power of all classes of shares of the Company or any
related corporation (as determined in accordance with Treasury Regulation
Section 1.422- 2(f)); provided, further, that notwithstanding any vesting dates
set by the Committee, the Committee may, in its sole discretion, accelerate the
exercisability of any Option, which acceleration shall not affect the terms and
conditions of such Option other than with respect to exercisability. In the
event of any termination of employment or service with the Company or its
Affiliates thereof of a Participant who has been granted one or more Options,
the Options shall be exercisable at the time or times and subject to the terms
and conditions set forth in the Award Agreement. If the Option would expire at a
time when the exercise of the Option would violate applicable securities laws,
the expiration date applicable to the Option will be automatically extended to a
date that is 30 calendar days following the date such exercise would no longer
violate applicable securities laws (so long as such extension shall not violate
Section 409A of the Code); provided, that in no event shall such expiration date
be extended beyond the expiration of the Option Period.

 

(d) Method of Exercise and Form of Payment. No Common Stock shall be delivered
pursuant to any exercise of an Option until payment in full of the Exercise
Price therefor is received by the Company and the Participant has paid to the
Company an amount equal to any taxes required to be withheld or paid upon
exercise of such Option. Options that have become exercisable may be exercised
by delivery of written or electronic notice of exercise to the Company in
accordance with the terms of the Option, accompanied by payment of the Exercise
Price. The Exercise Price shall be payable (i) in cash, check, cash equivalent
and/or Common Stock valued at the Fair Market Value at the time the Option is
exercised (including, pursuant to procedures approved by the Committee, by means
of attestation of ownership of a sufficient number of Common Stock in lieu of
actual delivery of such shares to the Company); provided, that, such Common
Stock are not subject to any pledge or other security interest and are Mature
Shares; and (ii) by such other method as the Committee may permit in accordance
with Applicable Law, in its sole discretion, including without limitation: (A)
in other property having a Fair Market Value on the date of exercise equal to
the Exercise Price, (B) if there is a public market for the Common Stock at such
time, by means of a broker-assisted “cashless exercise” pursuant to which the
Company is delivered a copy of irrevocable instructions to a stockbroker to sell
the Common Stock otherwise deliverable upon the exercise of the Option and to
deliver promptly to the Company an amount equal to the Exercise Price, or (C) by
a “net exercise” method whereby the Company withholds from the delivery of the
Common Stock for which the Option was exercised that number of Common Stock
having a Fair Market Value equal to the aggregate Exercise Price for the Common
Stock for which the Option was exercised. No fractional Common Stock shall be
issued or delivered pursuant to the Plan or any Award, and the Committee shall
determine whether cash, other securities or other property shall be paid or
transferred in lieu of any fractional Common Stock, or whether such fractional
Common Stock or any rights thereto shall be canceled, terminated or otherwise
eliminated.

 

(e) Notification upon Disqualifying Disposition of an Incentive Stock Option.
Each Participant awarded an Incentive Stock Option under the Plan shall notify
the Company in writing immediately after the date he makes a disqualifying
disposition of any Common Stock acquired pursuant to the exercise of such
Incentive Stock Option. A disqualifying disposition is any disposition
(including, without limitation, any sale) of such Common Stock before the later
of (i) two years after the Date of Grant of the Incentive Stock Option or (ii)
one year after the date of exercise of the Incentive Stock Option. The Company
may, if determined by the Committee and in accordance with procedures
established by the Committee, retain possession of any Common Stock acquired
pursuant to the exercise of an Incentive Stock Option as agent for the
applicable Participant until the end of the period described in the preceding
sentence.

 

9

 

 

(f) Compliance With Laws, etc. Notwithstanding the foregoing, in no event shall
a Participant be permitted to exercise an Option in a manner that the Committee
determines would violate the SarbanesOxley Act of 2002, if applicable; any other
Applicable Law; the applicable rules and regulations of the Securities and
Exchange Commission; or the applicable rules and regulations of any securities
exchange or inter-dealer quotation system on which the securities of the Company
are listed or traded.

 

8. Stock Appreciation Rights.

 

(a) Generally. Each SAR granted under the Plan shall be evidenced by an Award
Agreement (whether in paper or electronic medium (including email or the posting
on a web site maintained by the Company or a third party under contract with the
Company)). Each SAR so granted shall be subject to the conditions set forth in
this Section 8 and to such other conditions not inconsistent with the Plan as
may be reflected in the applicable Award Agreement. Any Option granted under the
Plan may include tandem SARs. The Committee also may award SARs to Eligible
Persons independent of any Option.

 

(b) Strike Price. The Strike Price per Common Share for each SAR shall not be
less than 100% of the Fair Market Value of such share determined as of the Date
of Grant.

 

(c) Vesting and Expiration. A SAR granted in connection with an Option shall
become exercisable and shall expire according to the same vesting schedule and
expiration provisions as the corresponding Option. A SAR granted independent of
an Option shall vest and become exercisable and shall expire in such manner and
on such date or dates determined by the Committee (including, if applicable, the
attainment of any performance goals, as shall be determined by the Committee in
the applicable Award Agreement) and shall expire after such period, not to
exceed ten years, as may be determined by the Committee (the “SAR Period”);
provided, however, that notwithstanding any vesting dates set by the Committee,
the Committee may, in its sole discretion, accelerate the exercisability of any
SAR, which acceleration shall not affect the terms and conditions of such SAR
other than with respect to exercisability. In the event of any termination of
employment or service with the Company and its Affiliates thereof of a
Participant who has been granted one of more SARs, the SARs shall be exercisable
at the time or times and subject to the terms and conditions as set forth in the
Award Agreement (or in the underlying Option Award Agreement, as may be
applicable). If the SAR would expire at a time when the exercise of the SAR
would violate applicable securities laws, the expiration date applicable to the
SAR will be automatically extended to a date that is 30 calendar days following
the date such exercise would no longer violate applicable securities laws (so
long as such extension shall not violate Section 409A of the Code); provided,
that, in no event shall such expiration date be extended beyond the expiration
of the SAR Period.

 

(d) Method of Exercise. SARs that have become exercisable may be exercised by
delivery of written or electronic notice of exercise to the Company in
accordance with the terms of the Award, specifying the number of SARs to be
exercised and the date on which such SARs were awarded.

 

(e) Payment. Upon the exercise of a SAR, the Company shall pay to the
Participant an amount equal to the number of shares subject to the SAR that are
being exercised, multiplied by the excess, if any, of the Fair Market Value of
one Common Share on the exercise date over the Strike Price, less an amount
equal to any taxes required to be withheld or paid. The Company shall pay such
amount in cash, in Common Stock having a Fair Market Value equal to such amount,
or any combination thereof, as determined by the Committee. No fractional Common
Stock shall be issued or delivered pursuant to the Plan or any Award, and the
Committee shall determine whether cash, other securities or other property shall
be paid or transferred in lieu of any fractional Common Stock, or whether such
fractional Common Stock or any rights thereto shall be canceled, terminated or
otherwise eliminated.

 

10

 

 

9. Restricted Stock and Restricted Stock Units.

 

(a) Generally. Each grant of Restricted Stock and Restricted Stock Units shall
be evidenced by an Award Agreement (whether in paper or electronic medium
(including email or the posting on a web site maintained by the Company or a
third party under contract with the Company)). Each such grant shall be subject
to the conditions set forth in this Section 9 and to such other conditions not
inconsistent with the Plan as may be reflected in the applicable Award Agreement
(including the performance goals, if any, upon whose attainment the Restricted
Period shall lapse in part or full).

 

(b) Restricted Accounts; Escrow or Similar Arrangement. Upon the grant of
Restricted Stock, a book entry in a restricted account shall be established in
the Participant’s name at the Company’s transfer agent and, if the Committee
determines that the Restricted Stock shall be held by the Company or in escrow
rather than held in such restricted account pending the release of the
applicable restrictions, the Committee may require the Participant to
additionally execute and deliver to the Company (i) an escrow agreement
satisfactory to the Committee, if applicable, and (ii) the appropriate stock
power (endorsed in blank) with respect to the Restricted Stock covered by such
agreement. If a Participant shall fail to execute an agreement evidencing an
Award of Restricted Stock and, if applicable, an escrow agreement and blank
stock power within the amount of time specified by the Committee, the Award
shall be null and void. Subject to the restrictions set forth in this Section 9
and the applicable Award Agreement, the Participant generally shall have the
rights and privileges of a stockholder as to such Restricted Stock, including,
without limitation, the right to vote such Restricted Stock and the right to
receive dividends, if applicable. To the extent shares of Restricted Stock are
forfeited, any share certificates issued to the Participant evidencing such
shares shall be returned to the Company, and all rights of the Participant to
such shares and as a stockholder with respect thereto shall terminate without
further obligation on the part of the Company.

 

(c) Vesting. Unless otherwise provided by the Committee in an Award Agreement
the unvested portion of Restricted Stock and Restricted Stock Units shall
terminate and be forfeited upon termination of employment or service of the
Participant granted the applicable Award.

 

(d) Delivery of Restricted Stock and Settlement of Restricted Stock Units.

 

(i) Upon the expiration of the Restricted Period with respect to any shares of
Restricted Stock, the restrictions set forth in the applicable Award Agreement
shall be of no further force or effect with respect to such shares, except as
set forth in the applicable Award Agreement. If an escrow arrangement is used,
upon such expiration, the Company shall deliver to the Participant, or his
beneficiary, without charge, the share certificate evidencing the shares of
Restricted Stock that have not then been forfeited and with respect to which the
Restricted Period has expired (rounded down to the nearest full share) or shall
register such shares in the Participants name without any such restrictions.
Dividends, if any, that may have been withheld by the Committee and attributable
to any particular share of Restricted Stock shall be distributed to the
Participant in cash or, at the sole discretion of the Committee, in Common Stock
having a Fair Market Value equal to the amount of such dividends, upon the
release of restrictions on such share and, if such share is forfeited, the
Participant shall have no right to such dividends (except as otherwise set forth
by the Committee in the applicable Award Agreement).

 

11

 

 

(ii) Unless otherwise provided by the Committee in an Award Agreement, upon the
expiration of the Restricted Period with respect to any outstanding Restricted
Stock Units, the Company shall deliver to the Participant, or his beneficiary,
without charge, one Common Share for each such outstanding Restricted Stock
Unit; provided, however, that the Committee may, in its sole discretion, elect
to (A) pay cash or part cash and part Common Share in lieu of delivering only
Common Stock in respect of such Restricted Stock Units or (B) defer the delivery
of Common Stock (or cash or part Common Stock and part cash, as the case may be)
beyond the expiration of the Restricted Period if such delivery would result in
a violation of Applicable Law until such time as is no longer the case. If a
cash payment is made in lieu of delivering Common Stock, the amount of such
payment shall be equal to the Fair Market Value of the Common Stock as of the
date on which the Restricted Period lapsed with respect to such Restricted Stock
Units, less an amount equal to any taxes required to be withheld or paid.

 

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

 

(a) Other Stock-Based Awards. The Committee may grant types of equity-based or
equityrelated Awards not otherwise described by the terms of the Plan (including
the grant or offer for sale of unrestricted Common Stock), in such amounts and
subject to such terms and conditions, as the Committee shall determine
(including, if applicable, the attainment of any performance goals, as set forth
in the applicable Award Agreement). Such Other Stock-Based Awards may involve
the transfer of actual Common Stock to Participants, or payment in cash or
otherwise of amounts based on the value of Common Stock. The terms and
conditions of such Awards shall be consistent with the Plan and set forth in the
Award Agreement and need not be uniform among all such Awards or all
Participants receiving such Awards.

 

(b) Other Cash-Based Awards. The Committee may grant a Participant a cash Award
not otherwise described by the terms of the Plan, including cash awarded as a
bonus or upon the attainment of performance goals or otherwise as permitted
under the Plan.

 

(c) Value of Awards. Each Other Stock-Based Award shall be expressed in terms of
Common Stock or units based on Common Stock, as determined by the Committee, and
each Other Cash-Based Awards shall be expressed in terms of cash, as determined
by the Committee. The Committee may establish performance goals in its
discretion and any such performance goals shall be set forth in the applicable
Award Agreement. If the Committee exercises its discretion to establish
performance goals, the number and/or value of Other Stock-Based Awards or Other
Cash-Based Awards that will be paid out to the Participant will depend on the
extent to which such performance goals are met.

 

(d) Payment of Awards. Payment, if any, with respect to an Other Stock-Based
Award or Other Cash-Based Award shall be made in accordance with the terms of
the Award, as set forth in the Award Agreement, in cash, Common Stock or a
combination of cash and Common Stock, as the Committee determines.

 

(e) Vesting. The Committee shall determine the extent to which the Participant
shall have the right to receive Other Stock-Based Awards or Other Cash-Based
Awards following the Participant’s termination of employment or service
(including by reason of such Participant’s death, disability (as determined by
the Committee), or termination without Cause). Such provisions shall be
determined in the sole discretion of the Committee and will be included in the
applicable Award Agreement but need not be uniform among all Other Stock-Based
Awards or Other Cash-Based Awards issued pursuant to the Plan and may reflect
distinctions based on the reasons for the termination of employment or service.

 

11. Dividend Equivalents. No adjustment shall be made in the Common Stock
issuable or taken into account under Awards on account of cash dividends that
may be paid or other rights that may be issued to the holders of Common Stock
prior to issuance of such Common Stock under such Award. The Committee may grant
Dividend Equivalents based on the dividends declared on Common Stock that are
subject to any Award (other than an Option or Stock Appreciation Right). Any
Award of Dividend Equivalents may be credited as of the dividend payment dates,
during the period between the Date of Grant of the Award and the date the Award
becomes payable or terminates or expires, as determined by the Committee;
however, Dividend Equivalents shall not be payable unless and until the Award
becomes payable, and shall be subject to forfeiture to the same extent as the
underlying Award. Dividend Equivalents may be subject to any additional
limitations and/or restrictions determined by the Committee. Dividend
Equivalents shall be payable in cash, Common Stock or converted to full-value
Awards, calculated based on such formula, as may be determined by the Committee.

 

12

 

 

12. Changes in Capital Structure and Similar Events. In the event of  (a) any
dividend (other than ordinary cash dividends) or other distribution (whether in
the form of cash, Common Stock, other securities or other property),
recapitalization, stock split, reverse stock split, reorganization, merger,
amalgamation, consolidation, spin-off, split-up, split-off, combination,
repurchase or exchange of Common Stock or other securities of the Company,
issuance of warrants or other rights to acquire Common Stock or other securities
of the Company, or other similar corporate transaction or event (including,
without limitation, a Change in Control) that affects the Common Stock, or (b)
unusual or infrequently occurring events (including, without limitation, a
Change in Control) affecting the Company, any Affiliate, or the financial
statements of the Company or any Affiliate, or changes in applicable rules,
rulings, regulations or other requirements of any governmental body or
securities exchange or inter-dealer quotation system, accounting principles or
law, such that in either case an adjustment is determined by the Committee in
its sole discretion to be necessary or appropriate, then the Committee shall
make any such adjustments in such manner as it may deem equitable, subject to
the requirements of Code Sections 409A, 421, and 422, if applicable, including
without limitation any or all of the following:

 

(a) adjusting any or all of  (i) the number of Common Stock or other securities
of the Company (or number and kind of other securities or other property) that
may be delivered in respect of Awards or with respect to which Awards may be
granted under the Plan (including, without limitation, adjusting any or all of
the limitations under Section 5 of the Plan) and (ii) the terms of any
outstanding Award, including, without limitation, (A) the number of Common Stock
or other securities of the Company (or number and kind of other securities or
other property) subject to outstanding Awards or to which outstanding Awards
relate, (B) the Exercise Price or Strike Price with respect to any Award or (C)
any applicable performance measures;

 

(b) providing for a substitution or assumption of Awards in a manner that
substantially preserves the applicable terms of such Awards;

 

(c) accelerating the exercisability or vesting of, lapse of restrictions on, or
termination of, Awards or providing for a period of time for exercise prior to
the occurrence of such event;

 

(d) modifying the terms of Awards to add events, conditions or circumstances
(including termination of employment within a specified period after a Change in
Control) upon which the exercisability or vesting of or lapse of restrictions
thereon will accelerate;

 

(e) deeming any performance measures satisfied at target, maximum or actual
performance through closing or such other level determined by the Committee in
its sole discretion, or providing for the performance measures to continue (as
is or as adjusted by the Committee) after closing;

 

(f) providing that for a period prior to the Change in Control determined by the
Committee in its sole discretion, any Options or SARs that would not otherwise
become exercisable prior to the Change in Control will be exercisable as to all
Common Stock subject thereto (but any such exercise will be contingent upon and
subject to the occurrence of the Change in Control and if the Change in Control
does not take place after giving such notice for any reason whatsoever, the
exercise will be null and void) and that any Options or SARs not exercised prior
to the consummation of the Change in Control will terminate and be of no further
force and effect as of the consummation of the Change in Control; and

 

13

 

 

(g) canceling any one or more outstanding Awards and causing to be paid to the
holders thereof, in cash, Common Stock, other securities or other property, or
any combination thereof, the value of such Awards, if any, as determined by the
Committee (which if applicable may be based upon the price per Common Share
received or to be received by other stockholders of the Company in such event),
including without limitation, in the case of an outstanding Option or SAR, a
cash payment in an amount equal to the excess, if any, of the Fair Market Value
(as of a date specified by the Committee) of the Common Stock subject to such
Option or SAR over the aggregate Exercise Price or Strike Price of such Option
or SAR, respectively (it being understood that, in such event, any Option or SAR
having a per share Exercise Price or Strike Price equal to, or in excess of, the
Fair Market Value of a Common Share subject thereto may be canceled and
terminated without any payment or consideration therefor); provided, however,
that in the case of any “equity restructuring” (within the meaning of the
Financial Accounting Standards Board Accounting Standards Codification Topic
718), the Committee shall make an equitable or proportionate adjustment to
outstanding Awards to reflect such equity restructuring. The Company shall give
each Participant notice of an adjustment hereunder and, upon notice, such
adjustment shall be final, conclusive and binding for all purposes.

 

13. Amendments and Termination.

 

(a) Amendment and Termination of the Plan. The Board may amend, alter, suspend,
discontinue, or terminate the Plan or any portion thereof at any time; provided
that (i) no amendment to Section 13(b) (to the extent required by the proviso in
such Section 13(b)) shall be made without stockholder approval and (ii) no such
amendment, alteration, suspension, discontinuation or termination shall be made
without stockholder approval if such approval is necessary to comply with any
tax or regulatory requirement applicable to the Plan (including, without
limitation, as necessary to comply with any rules or requirements of any
securities exchange or inter-dealer quotation system on which the Common Stock
may be listed or quoted); provided, further, that any such amendment,
alteration, suspension, discontinuance or termination that would materially and
adversely affect the rights of any Participant or any holder or beneficiary of
any Award theretofore granted shall not to that extent be effective without the
consent of the affected Participant, holder or beneficiary.

 

(b) Amendment of Award Agreements. The Committee may, to the extent consistent
with the terms of any applicable Award Agreement, waive any conditions or rights
under, amend any terms of, or alter, suspend, discontinue, cancel or terminate,
any Award theretofore granted or the associated Award Agreement, prospectively
or retroactively; provided that any such waiver, amendment, alteration,
suspension, discontinuance, cancellation or termination that would materially
and adversely affect the rights of any Participant with respect to any Award
theretofore granted shall not to that extent be effective without the consent of
the affected Participant, unless the Committee determines, in its sole
discretion, that the amendment is necessary for the Award to comply with Code
Section 409A; provided, further, that without stockholder approval, except as
otherwise permitted under Section 12 of the Plan, (i) no amendment or
modification may reduce the Exercise Price of any Option or the Strike Price of
any SAR, (ii) the Committee may not cancel any outstanding Option or SAR where
the Fair Market Value of the Common Stock underlying such Option or SAR is less
than its Exercise Price and replace it with a new Option or SAR, another Award
or cash and (iii) the Committee may not take any other action that is considered
a “repricing” for purposes of the stockholder approval rules of the applicable
securities exchange or inter-dealer quotation system on which the Common Stock
are listed or quoted.

 

14

 

 

14. General.

 

(a) Award Agreements. Each Award under the Plan shall be evidenced by an Award
Agreement, which shall be delivered to the Participant (whether in paper or
electronic medium (including email or the posting on a web site maintained by
the Company or a third party under contract with the Company)) and shall specify
the terms and conditions of the Award and any rules applicable thereto,
including, without limitation, the effect on such Award of the death, disability
or termination of employment or service of a Participant, or of such other
events as may be determined by the Committee. Except as the Plan otherwise
provides, each Award may be made alone or in addition or in relation to any
other Award. The terms of each Award to a Participant need not be identical, and
the Committee need not treat Participants or Awards (or portions thereof)
uniformly.

 

(b) Nontransferability.

 

(i) Each Award shall be exercisable only by a Participant during the
Participant’s lifetime, or, if permissible under Applicable Law, by the
Participant’s legal guardian or representative. No Award may be assigned,
alienated, pledged, attached, sold or otherwise transferred or encumbered by a
Participant other than by will or by the laws of descent and distribution and
any such purported assignment, alienation, pledge, attachment, sale, transfer or
encumbrance shall be void and unenforceable against the Company or an Affiliate;
provided that the designation of a beneficiary shall not constitute an
assignment, alienation, pledge, attachment, sale, transfer or encumbrance.

 

(ii) Notwithstanding the foregoing, the Committee may, in its sole discretion,
permit Awards (other than Incentive Stock Options) to be transferred by a
Participant, without consideration, subject to such rules as the Committee may
adopt consistent with any applicable Award Agreement to preserve the purposes of
the Plan, to: (A) any person who is a “family member” of the Participant, as
such term is used in the instructions to Form S-8 under the Securities Act
(collectively, the “Immediate Family Members”); (B) a trust solely for the
benefit of the Participant and his Immediate Family Members; (C) a partnership
or limited liability company whose only partners or stockholders are the
Participant and his Immediate Family Members; or (D) any other transferee as may
be approved either (I) by the Board or the Committee in its sole discretion, or
(II) as provided in the applicable Award Agreement (each transferee described in
clauses (A), (B), (C) and (D) above is hereinafter referred to as, a “Permitted
Transferee”); provided that the Participant gives the Committee advance written
notice describing the terms and conditions of the proposed transfer and the
Committee notifies the Participant in writing that such a transfer would comply
with the requirements of the Plan.

 

(iii) The terms of any Award transferred in accordance with the immediately
preceding sentence shall apply to the Permitted Transferee and any reference in
the Plan, or in any applicable Award Agreement, to a Participant shall be deemed
to refer to the Permitted Transferee, except that (A) Permitted Transferees
shall not be entitled to transfer any Award, other than by will or the laws of
descent and distribution; (B) Permitted Transferees shall not be entitled to
exercise any transferred Option unless there shall be in effect a registration
statement on an appropriate form covering the Common Stock to be acquired
pursuant to the exercise of such Option if the Committee determines, consistent
with any applicable Award Agreement, that such a registration statement is
necessary or appropriate; (C) the Committee or the Company shall not be required
to provide any notice to a Permitted Transferee, whether or not such notice is
or would otherwise have been required to be given to the Participant under the
Plan or otherwise; and (D) the consequences of the termination of the
Participant’s employment by, or services to, the Company or an Affiliate under
the terms of the Plan and the applicable Award Agreement shall continue to be
applied with respect to the Participant, including, without limitation, that an
Option shall be exercisable by the Permitted Transferee only to the extent, and
for the periods, specified in the Plan and the applicable Award Agreement.

 

15

 

 

(c) Tax Withholding and Deductions.

 

(i) A Participant shall be required to pay to the Company or any Affiliate, and
the Company or any Affiliate shall have the right and is hereby authorized to
deduct and withhold, from any cash, Common Stock, other securities or other
property deliverable under any Award or from any compensation or other amounts
owing to a Participant, the amount (in cash, Common Stock, other securities or
other property) of any required taxes (up to the maximum statutory rate under
Applicable Law as in effect from time to time as determined by the Committee)
and deduction in respect of an Award, its grant, vesting or exercise, or any
payment or transfer under an Award or under the Plan and to take such other
action as may be necessary in the opinion of the Committee or the Company to
satisfy all obligations for the payment of such taxes.

 

(ii) Without limiting the generality of clause (i) above, the Committee may, in
its sole discretion, permit a Participant to satisfy, in whole or in part, the
foregoing tax and deduction liability by (A) the delivery of Common Stock (which
are not subject to any pledge or other security interest and are Mature Shares,
except as otherwise determined by the Committee) owned by the Participant having
a Fair Market Value equal to such liability or (B) having the Company withhold
from the number of Common Stock otherwise issuable or deliverable pursuant to
the exercise or settlement of the Award a number of shares with a Fair Market
Value equal to such liability.

 

(d) No Claim to Awards; No Rights to Continued Employment; Waiver. No employee
of the Company or an Affiliate, or other person, shall have any Claim or right
to be granted an Award under the Plan or, having been selected for the grant of
an Award, to be selected for a grant of any other Award. A Participant’s sole
remedy for any Claim related to the Plan or any Award shall be against the
Company, and no Participant shall have any Claim or right of any nature against
any Subsidiary or Affiliate of the Company or any stockholder or existing or
former director, officer or employee of the Company or any Subsidiary of the
Company. There is no obligation for uniformity of treatment of Participants or
holders or beneficiaries of Awards. The terms and conditions of Awards and the
Committee’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. Neither
the Plan nor any action taken hereunder shall be construed as giving any
Participant any right to be retained in the employ or service of the Company or
an Affiliate, nor shall it be construed as giving any Participant any rights to
continued service on the Board. The Company or any of its Affiliates may at any
time dismiss a Participant from employment or discontinue any consulting
relationship, free from any liability or any Claim under the Plan, unless
otherwise expressly provided in the Plan or any Award Agreement. By accepting an
Award under the Plan, a Participant shall thereby be deemed to have waived any
Claim to continued exercise or vesting of an Award or to damages or severance
entitlement related to non-continuation of the Award beyond the period provided
under the Plan or any Award Agreement, notwithstanding any provision to the
contrary in any written employment contract or other agreement between the
Company and its Affiliates and the Participant, whether any such agreement is
executed before, on or after the Date of Grant.

 

(e) International Participants. With respect to Participants who reside or work
outside of the United States of America, the Committee may in its sole
discretion amend the terms of the Plan or outstanding Awards with respect to
such Participants in order to conform such terms with the requirements of local
law or to obtain more favorable tax or other treatment for a Participant, the
Company or its Affiliates.

 

16

 

 

(f) Designation and Change of Beneficiary. Each Participant may file with the
Committee a written designation of one or more persons as the beneficiary(ies)
who shall be entitled to receive the amounts payable with respect to an Award,
if any, due under the Plan upon his death. A Participant may, from time to time,
revoke or change his beneficiary designation without the consent of any prior
beneficiary by filing a new designation with the Committee. The last such
designation received by the Committee shall be controlling; provided, however,
that no designation, or change or revocation thereof, shall be effective unless
received by the Committee prior to the Participant’s death, and in no event
shall it be effective as of a date prior to such receipt. If no beneficiary
designation is filed by a Participant, the beneficiary shall be deemed to be his
spouse or, if the Participant is unmarried at the time of death, his estate.

 

(g) Termination of Employment/Service. Unless determined otherwise by the
Committee at any time following such event: (i) neither a temporary absence from
employment or service due to illness, vacation or leave of absence nor a
transfer from employment or service with the Company to employment or service
with an Affiliate (or vice-versa) shall be considered a termination of
employment or service with the Company or an Affiliate; and (ii) if a
Participant’s employment with the Company and its Affiliates terminates, but
such Participant continues to provide services to the Company and its Affiliates
in a non-employee capacity (or vice-versa), such change in status shall not be
considered a termination of employment with the Company or an Affiliate.

 

(h) No Rights as a Stockholder. Except as otherwise specifically provided in the
Plan or any Award Agreement, no person shall be entitled to the privileges of
ownership in respect of Common Stock or other securities that are subject to
Awards hereunder until such shares have been issued or delivered to that person.

 

(i) Government and Other Regulations.

 

(i) The obligation of the Company to settle Awards in Common Stock or other
consideration shall be subject to all Applicable Laws, rules, and regulations,
and to such approvals by governmental agencies as may be required.
Notwithstanding any terms or conditions of any Award to the contrary, the
Company shall be under no obligation to offer to sell or to sell, and shall be
prohibited from offering to sell or selling, any Common Stock or other
securities pursuant to an Award unless such shares have been properly registered
for sale pursuant to the Securities Act with the Securities and Exchange
Commission or unless the Company has received an opinion of counsel,
satisfactory to the Company, that such shares may be offered or sold without
such registration pursuant to an available exemption therefrom and the terms and
conditions of such exemption have been fully complied with. The Company shall be
under no obligation to register for sale under the Securities Act any of the
Common Stock or other securities to be offered or sold under the Plan. The
Committee shall have the authority to provide that all certificates for Common
Stock or other securities of the Company or any Affiliate delivered under the
Plan shall be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the Plan, the applicable Award Agreement, the
federal securities laws, or the rules, regulations and other requirements of the
Securities and Exchange Commission, any securities exchange or interdealer
quotation system upon which such shares or other securities are then listed or
quoted and any other applicable federal, state, local or non-U.S. laws, and,
without limiting the generality of Section 9 of the Plan, the Committee may
cause a legend or legends to be put on any such certificates to make appropriate
reference to such restrictions. Notwithstanding any provision in the Plan to the
contrary, the Committee reserves the right to add any additional terms or
provisions to any Award granted under the Plan that it in its sole discretion
deems necessary or advisable in order that such Award complies with the legal
requirements of any governmental entity to whose jurisdiction the Award is
subject.

 

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(ii) The Committee may cancel an Award or any portion thereof if the Committee
determines, in its sole discretion, that legal or contractual restrictions
and/or blockage and/or other market considerations would make the Company’s
acquisition of Common Stock from the public markets, the Company’s issuance of
Common Stock or other securities to the Participant, the Participant’s
acquisition of Common Stock or other securities from the Company and/or the
Participant’s sale of Common Stock to the public markets, illegal, impracticable
or inadvisable. If the Committee determines to cancel all or any portion of an
Award denominated in Common Stock in accordance with the foregoing, the Company
shall pay to the Participant an amount equal to the excess of  (A) the aggregate
Fair Market Value of the Common Stock subject to such Award or portion thereof
that is canceled (determined as of the applicable exercise date, or the date
that the shares would have been vested or delivered, as applicable), over (B)
the aggregate Exercise Price or Strike Price (in the case of an Option or SAR,
respectively) or any amount payable as a condition of delivery of Common Stock
(in the case of any other Award). Such amount shall be delivered to the
Participant as soon as practicable following the cancellation of such Award or
portion thereof.

 

(j) Payments to Persons Other Than Participants. If the Committee shall find
that any person to whom any amount is payable under the Plan is unable to care
for his or her affairs because of illness or accident, or is a minor, or has
died, then any payment due to such person or his estate (unless a prior Claim
therefor has been made by a duly appointed legal representative) may, if the
Committee so directs the Company, be paid to his or her spouse, child, relative,
an institution maintaining or having custody of such person, or any other person
deemed by the Committee to be a proper recipient on behalf of such person
otherwise entitled to payment. Any such payment shall be a complete discharge of
the liability of the Committee and the Company therefor.

 

(k) Nonexclusivity of the Plan. Neither the adoption of this Plan by the Board
nor the submission of this Plan to the stockholders of the Company for approval
shall be construed as creating any limitations on the power of the Board to
adopt such other incentive arrangements as it may deem desirable, including,
without limitation, the granting of stock options or other equity-based awards
otherwise than under this Plan, and such arrangements may be either applicable
generally or only in specific cases.

 

(l) No Trust or Fund Created. The Plan is intended to constitute an “unfunded”
plan for incentive compensation. 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 Company or any Affiliate, on the one hand, and a
Participant or other person or entity, on the other hand. No provision of the
Plan or any Award shall require the Company, for the purpose of satisfying any
obligations under the Plan, to purchase assets or place any assets in a trust or
other entity to which contributions are made or otherwise to segregate any
assets, nor shall the Company maintain separate bank accounts, books, records or
other evidence of the existence of a segregated or separately maintained or
administered fund for such purposes. Participants shall have no rights under the
Plan other than as unsecured general creditors of the Company, except that
insofar as they may have become entitled to payment of additional compensation
by performance of services, they shall have the same rights as other employees
or service providers under general law.

 

(m) Reliance on Reports. Each member of the Committee and each member of the
Board shall be fully justified in acting or failing to act, as the case may be,
and shall not be liable for having so acted or failed to act in good faith, in
reliance upon any report made by the independent public accountant of the
Company and its Affiliates and/or any other information furnished in connection
with the Plan by any agent of or service provider to the Company or the
Committee or the Board, other than himself.

 

(n) Relationship to Other Benefits. No payment under the Plan shall be taken
into account in determining any benefits under any pension, retirement, profit
sharing, group insurance or other benefit plan of the Company except as
otherwise specifically provided in such other plan.

 

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(o) Governing Law. The Plan shall be governed by and construed in accordance
with the internal laws of the State of Delaware applicable to contracts made and
performed wholly within the State of Delaware, without giving effect to the
conflict of laws provisions thereof.

 

(p) Severability. If any provision of the Plan or any Award or Award Agreement
is or becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction or as to any person or entity or Award, or would disqualify the
Plan or any Award under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to the Applicable
Laws, or if it cannot be construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan or
the Award, such provision shall be construed or deemed stricken as to such
jurisdiction, person or entity or Award and the remainder of the Plan and any
such Award shall remain in full force and effect.

 

(q) Obligations Binding on Successors. The obligations of the Company under the
Plan shall be binding upon any successor corporation or organization resulting
from the merger, amalgamation, consolidation or other reorganization of the
Company, or upon any successor corporation or organization succeeding to
substantially all of the assets and business of the Company.

 

(r) Code Section 409A.

 

(i) Notwithstanding any provision of this Plan to the contrary, all Awards made
under this Plan are intended to be exempt from or, in the alternative, comply
with Code Section 409A and the authoritative guidance thereunder, including the
exceptions for stock rights and short-term deferrals. The Plan shall be
construed and interpreted in accordance with such intent. Each payment under an
Award shall be treated as a separate payment for purposes of Code Section 409A.

 

(ii) If a Participant is a “specified employee” (as such term is defined for
purposes of Code Section 409A) at the time of his termination of service, no
amount that is nonqualified deferred compensation subject to Code Section 409A
and that becomes payable by reason of such termination of service shall be paid
to the Participant (or in the event of the Participant’s death, the
Participant’s representative or estate) before the earlier of  (x) the first
business day after the date that is six months following the date of the
Participant’s termination of service, and (y) within 30 days following the date
of the Participant’s death. For purposes of Code Section 409A, a termination of
service shall be deemed to occur only if it is a “separation from service”
within the meaning of Code Section 409A, and references in the Plan and any
Award Agreement to “termination of service” or similar terms shall mean a
“separation from service.” If any Award is or becomes subject to Code Section
409A, unless the applicable Award Agreement provides otherwise, such Award shall
be payable upon the Participant’s “separation from service” within the meaning
of Code Section 409A. If any Award is or becomes subject to Code Section 409A
and if payment of such Award would be accelerated or otherwise triggered under a
Change in Control, then the definition of Change in Control shall be deemed
modified, only to the extent necessary to avoid the imposition of any additional
tax under Code Section 409A, to mean a “change in control event” as such term is
defined for purposes of Code Section 409A.

 

(iii) Any adjustments made pursuant to Section 13 to Awards that are subject to
Code Section 409A shall be made in compliance with the requirements of Code
Section 409A, and any adjustments made pursuant to Section 13 to Awards that are
not subject to Code Section 409A shall be made in such a manner as to ensure
that after such adjustment, the Awards either (x) continue not to be subject to
Code Section 409A or (y) comply with the requirements of Code Section 409A.

 

(s) Notification of Election Under Code Section 83(b). If any Participant, in
connection with the acquisition of Common Stock under an Award, makes the
election permitted under Code Section 83(b), if applicable, the Participant
shall notify the Company of the election within ten days of filing notice of the
election with the Internal Revenue Service.

 

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(t) Expenses; Gender; Titles and Headings; Interpretation. The expenses of
administering the Plan shall be borne by the Company and its Affiliates.
Masculine pronouns and other words of masculine gender shall refer to both men
and women. The titles and headings of the sections in the Plan are for
convenience of reference only, and in the event of any conflict, the text of the
Plan, rather than such titles or headings shall control. Unless the context of
the Plan otherwise requires, words using the singular or plural number also
include the plural or singular number, respectively; derivative forms of defined
terms will have correlative meanings; the terms “hereof,” “herein” and
“hereunder” and derivative or similar words refer to this entire Plan; the term
“Section” refers to the specified Section of this Plan and references to
“paragraphs” or “clauses” shall be to separate paragraphs or clauses of the
Section or subsection in which the reference occurs; the words “include,”
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”; and the word “or” shall be disjunctive but not exclusive

 

(u) Other Agreements. Notwithstanding the above, the Committee may require, as a
condition to the grant of and/or the receipt of Common Stock or other securities
under an Award, that the Participant execute lock-up, stockholder or other
agreements, as it may determine in its sole and absolute discretion.

 

(v) Payments. Participants shall be required to pay, to the extent required by
Applicable Law, any amounts required to receive Common Stock or other securities
under any Award made under the Plan.

 

(w) Clawback; Erroneously Awarded Compensation. All Awards (including on a
retroactive basis) granted under the Plan are subject to the terms of any
Company forfeiture, incentive compensation recoupment, clawback or similar
policy as it may be in effect from time to time, as well as any similar
provisions of Applicable Laws, as well as any other policy of the Company that
may apply to the Awards, such as anti-hedging or pledging policies, as they may
be in effect from time to time. In particular, these policies and/or provisions
shall include, without limitation, (i) any Company policy established to comply
with Applicable Laws (including, without limitation, Section 304 of the
Sarbanes-Oxley Act and Section 954 of the Dodd-Frank Wall Street Reform and
Consumer Protection Act), and/or (ii) the rules and regulations of the
applicable securities exchange or inter-dealer quotation system on which the
Common Stock or other securities are listed or quoted, and these requirements
shall be deemed incorporated by reference into all outstanding Award Agreements.

 

(x) No Fractional Shares. No fractional shares of Common Stock shall be issued
or delivered pursuant to the Plan. The Committee shall determine whether cash,
other Awards, or other property shall be issued or paid in lieu of fractional
shares or whether fractional shares or any rights thereto shall be forfeited,
rounded, or otherwise eliminated.

 

(y) Paperless Administration. If the Company establishes, for itself or using
the services of a third party, an automated system for the documentation,
granting or exercise of Awards, such as a system using an internet website or
interactive voice response, then the paperless documentation, granting or
exercise of Awards by a Participant may be permitted through the use of such an
automated system.

 

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(z) Data Privacy. As a condition for receiving any Award, each Participant
explicitly and unambiguously consents to the collection, use and transfer, in
electronic or other form, of personal data as described in this Section 14(z) by
and among the Company and its Subsidiaries and Affiliates exclusively for
implementing, administering and managing the Participant’s participation in the
Plan. The Company and its Subsidiaries and Affiliates may hold certain personal
information about a Participant, including the Participant’s name, address and
telephone number; birthdate; social security, insurance number or other
identification number; salary; nationality; job title(s); any Common Stock held
in the Company or its Subsidiaries and Affiliates; and Award details, to
implement, manage and administer the Plan and Awards (the “Data”). The Company
and its Subsidiaries and Affiliates may transfer the Data amongst themselves as
necessary to implement, administer and manage a Participant’s participation in
the Plan, and the Company and its Subsidiaries and Affiliates may transfer the
Data to third parties assisting the Company with Plan implementation,
administration and management. These recipients may be located in the
Participant’s country, or elsewhere, and the Participant’s country may have
different data privacy laws and protections than the recipients’ country. By
accepting an Award, each Participant authorizes the recipients to receive,
possess, use, retain and transfer the Data, in electronic or other form, to
implement, administer and manage the Participant’s participation in the Plan,
including any required Data transfer to a broker or other third party with whom
the Company or the Participant may elect to deposit any Common Stock. The Data
related to a Participant will be held only as long as necessary to implement,
administer, and manage the Participant’s participation in the Plan. A
Participant may, at any time, view the Data that the Company holds regarding the
Participant, request additional information about the storage and processing of
the Data regarding the Participant, recommend any necessary corrections to the
Data regarding the Participant or refuse or withdraw the consents in this
Section 14(z) in writing, without cost, by contacting the local human resources
representative. The Company may cancel Participant’s ability to participate in
the Plan and, in the Committee’s discretion, the Participant may forfeit any
outstanding Awards if the Participant refuses or withdraws the consents in this
Section 14(z).

 

(aa) Broker-Assisted Sales. In the event of a broker-assisted sale of Common
Stock in connection with the payment of amounts owed by a Participant under or
with respect to the Plan or Awards: (a) any Common Stock to be sold through the
broker-assisted sale will be sold on the day the payment first becomes due, or
as soon thereafter as practicable; (b) the Common Stock may be sold as part of a
block trade with other Participants in the Plan in which all participants
receive an average price; (c) the applicable Participant will be responsible for
all broker’s fees and other costs of sale, and by accepting an Award, each
Participant agrees to indemnify and hold the Company harmless from any losses,
costs, damages, or expenses relating to any such sale; (d) to the extent the
Company or its designee receives proceeds of the sale that exceed the amount
owed, the Company will pay the excess in cash to the applicable Participant as
soon as reasonably practicable; (e) the Company and its designees are under no
obligation to arrange for the sale at any particular price; and (f) if the
proceeds of the sale are insufficient to satisfy the Participant’s applicable
obligation, the Participant may be required to pay immediately upon demand to
the Company or its designee an amount in cash sufficient to satisfy any
remaining portion of the Participant’s obligation.

 

 

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