Exhibit 10.1


 


CHARLES RIVER LABORATORIES INTERNATIONAL, INC.


2007
INCENTIVE PLAN


Originally
adopted by the Board of Directors on March 22, 2007;


approved by
the shareholders on May 8, 2007;


amended by
the Board of Directors on February 13, 2009;


amended by
the Compensation Committee of the Board of Directors on March 18, 2009


 


1.                                      ADMINISTRATION


 


Subject to the express provisions of the
Plan, the Administrator has the authority to interpret the Plan; determine
eligibility for and grant Awards; determine, modify or waive the terms and
conditions of any Award; prescribe forms, rules and procedures (which it
may modify or waive); and otherwise do all things necessary to implement the
Plan. Once an Award has been communicated in writing to a Participant, the Administrator
may not, without the Participant’s consent, alter the terms of the Award so as
to affect adversely the Participant’s rights under the Award, unless the
Administrator has expressly reserved the right to do so. In the case of any
Award intended to be eligible for the performance-based compensation exception
under Section 162(m), the Administrator shall exercise its discretion
consistent with qualifying the Award for such exception.


 


2.                                      LIMITS ON AWARDS UNDER THE PLAN


 


a.                                       NUMBER OF SHARES. 
Subject to adjustments as provided in Section 5, the total number
of shares of Stock subject to Awards granted under the Plan, in the aggregate,
may not exceed 8,800,000 (the “Fungible Pool Limit”). Each share of Stock
issued or to be issued in connection with any Full-Value Award shall be counted
against the Fungible Pool Limit as 2.3 Fungible Pool Units. Stock Options, SARs
and other Awards that do not deliver the full value at grant thereof of the
underlying shares of Stock and that expire no more than seven (7)  years
from the date of grant shall be counted against the Fungible Pool Limit as one
(1.0) Fungible Pool Unit. (For these purposes, the number of shares of Stock
taken into account with respect to a SAR shall be the number of shares of Stock
underlying the SAR at grant (i.e., not the final number of shares of Stock
delivered upon exercise of the SAR)). For purposes of the preceding sentence,
shares that have been forfeited or cancelled in accordance with the terms of
the applicable Award shall not be considered to have been delivered under the
Plan, but shares held back in satisfaction of the exercise price or tax
withholding requirements from shares that would otherwise have been delivered
pursuant to an Award will be considered to have been delivered under the Plan.
Any shares of Stock that again become available for grant pursuant to this Section 2(a) shall
be added back to the pool of available shares. 
For purposes of clarity, in calculating the number of shares of stock
remaining under the Fungible Pool Limit, the Administrator will not increase
the number of available Fungible Pool Units for shares of Stock delivered under
an Award (i.e. previously acquired Shares tendered by the Participant in
payment of the exercise price or of withholding taxes).  The Administrator shall determine the
appropriate methodology for calculating 


 

















 


the
number of shares of Stock issued pursuant to the Plan.


 


b.                                      TYPE OF SHARES.  Stock
delivered by the Company under the Plan may be authorized but unissued Stock or
previously issued Stock acquired by the Company and held in treasury. No
fractional shares of Stock will be delivered under the Plan.


 


c.                                       CERTAIN SHARE LIMITS.  The maximum number of shares of Stock for
which Stock Options may be granted to any person annually from and after
adoption of the Plan and prior to March 22, 2017, the maximum number of
shares of Stock subject to SARs granted to any person annually during such
period and the aggregate maximum number of shares of Stock subject to other
Awards that may be delivered (or the value of which may be paid) to any person
annually during such period shall each be 2,000,000. For purposes of the
preceding sentence, the repricing of a Stock Option or SAR shall be treated as
a new grant to the extent required under Section 162(m), PROVIDED, no such
repricing shall be permitted except in accordance with Section 4.a.(10) of
this Plan. Each person eligible to participate in the Plan shall be eligible to
receive Awards covering up to the full number of shares of Stock then available
for Awards under the Plan. No Awards may be granted under the Plan after March 22
2017, but previously granted Awards may extend beyond that date.


 


d.                                      OTHER AWARD LIMITS.  No
more than $3,000,000 may be paid to any individual with respect to any Cash
Performance Award (other than an Award expressed in terms of shares of Stock or
units representing Stock, which shall instead be subject to the limit set forth
in Section 2.c. above). In applying the dollar limitation of the preceding
sentence: (A) multiple Cash Performance Awards to the same individual that
are determined by reference to performance periods of one year with or within
the same fiscal year of the Company shall be subject in the aggregate to one
limit of such amount, and (B) multiple Cash Performance Awards to the same
individual that are determined by reference to one or more multi-year
performance periods ending in the same fiscal year of the Company shall be
subject in the aggregate to a separate limit of such amount.


 


3.                                      ELIGIBILITY AND PARTICIPATION


 


The Administrator will select Participants
from among those key Employees, directors and other individuals or entities
providing services to the Company or its Affiliates who, in the opinion of the
Administrator, are in a position to make a significant contribution to the
success of the Company and its Affiliates. Eligibility for ISOs is further
limited to those individuals whose employment status would qualify them for the
tax treatment described in Sections 421 and 422 of the Code.


 


4.                                      RULES APPLICABLE TO AWARDS


 


a.                                       ALL AWARDS


 


(1)                                 TERMS OF
AWARDS. All Awards of Stock Options and SARs granted hereunder shall have a
term of not to exceed seven years from the date of grant.  The Administrator shall determine all other
terms of all Awards 


 


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subject to the limitations provided herein.


 


(2)                                 PERFORMANCE
CRITERIA. Where rights under an Award depend in whole or in part on
satisfaction of Performance Criteria, actions by the Company that have an effect,
however material, on such Performance Criteria or on the likelihood that they
will be satisfied will not be deemed an amendment or alteration of the Award.


 


(3)                                 ALTERNATIVE
SETTLEMENT. The Company may at any time extinguish rights under an Award in exchange
for payment in cash, Stock (subject to the limitations of Section 2) or
other property on such terms as the Administrator determines, PROVIDED the
holder of the Award consents to such exchange, PROVIDED FURTHER, no such
exchange will be made where the cash, Stock or property to be received has a
fair market value greater than the Award being extinguished, or where any such
exchange would violate Section 4.a.(10) of this Plan.


 


(4)                                 TRANSFERABILITY
OF AWARDS. Awards may not be transferred other than by will or by the laws of
descent and distribution and during a Participant’s lifetime an Award requiring
exercise may be exercised only by the Participant (or in the event of the
Participant’s incapacity, the person or persons legally appointed to act on the
Participant’s behalf).


 


(5)                                 VESTING, ETC.
Without limiting the generality of Section 1, the Administrator may
determine the time or times at which an Award will vest (i.e., become free of
forfeiture restrictions) or become exercisable and the terms on which an Award
requiring exercise will remain exercisable. Unless otherwise provided by Section 4.e
with respect to Performance Awards or if the Administrator expressly provides
otherwise:


 


(A)                             immediately
upon the cessation of a Participant’s employment or other service relationship
with the Company and its Affiliates, all Awards (other than Stock Options and
SARs) held by the Participant (or by a permitted transferee under Section 4.a.(4))
immediately prior to such cessation of employment or other service relationship
will be forfeited if not then vested and, where exercisability is relevant,
will cease to be exercisable;


 


(B)                               except as
provided in (C) and (D) below, all Stock Options and SARs held by a
Participant (or by a permitted transferee under Section 4.a.(4))
immediately prior to the cessation of the Participant’s employment or other
service relationship for reasons other than death, to the extent then
exercisable, will remain exercisable for the lesser of (i) a period of
three months or (ii) the period ending on the latest date on which such
Stock Option or SAR could have been exercised without regard to this Section 4.a.(5),
and shall thereupon 


 


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terminate;


 


(C)                               all Stock
Options and SARs held by a Participant (or by a permitted transferee under Section 4.a.(4))
immediately prior to the Participant’s death, to the extent then exercisable,
will remain exercisable for the lesser of (i) the one-year period ending
with the first anniversary of the Participant’s death or (ii) the period
ending on the latest date on which such Stock Option or SAR could have been
exercised without regard to this Section 4.a.(5), and shall thereupon
terminate; and


 


(D)                              all Stock
Options and SARs held by a Participant (or by a permitted transferee of the
Participant under Section 4.a.(4)) whose cessation of employment or other
service relationship is determined by the Administrator in its sole discretion
to result from reasons which cast such discredit on the Participant as to
justify immediate termination of the Award shall immediately terminate upon
such cessation.


 


Unless the Administrator expressly provides otherwise, a Participant’s “employment
or other service relationship with the Company and its Affiliates” will be deemed
to have ceased, in the case of an employee Participant, upon termination of the
Participant’s employment with the Company and its Affiliates (whether or not
the Participant continues in the service of the Company or its Affiliates in
some capacity other than that of an employee of the Company or its Affiliates),
and in the case of any other Participant, when the service relationship in
respect of which the Award was granted terminates (whether or not the
Participant continues in the service of the Company or its Affiliates in some
other capacity).


 


(6)                                 TAXES. The
Administrator will make such provision for the withholding of taxes as it deems
necessary. The Administrator may, but need not, hold back shares of Stock from
an Award or permit a Participant to tender previously owned shares of Stock in
satisfaction of tax withholding requirements. In no event shall Stock be
tendered or held back by the Company in excess of the minimum amount required
to be withheld for Federal, state, and local taxes. As provided in Section 2(a) of
this Plan, in the event shares of Stock are held back from an Award in
satisfaction of tax withholding requirements, such shares will nonetheless be
considered to have been delivered under the Plan.


 


(7)                                 DIVIDEND
EQUIVALENTS, ETC. The Administrator may provide for the payment of amounts in
lieu of cash dividends or other cash distributions with respect to Stock
subject to any Full Value Award if and in such manner as it deems appropriate.


 


(8)                                 RIGHTS LIMITED.
Nothing in the Plan shall be construed as giving any 


 


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person the right to continued employment or service with the Company or
its Affiliates, or any rights as a shareholder except as to shares of Stock
actually issued under the Plan. The loss of existing or potential profit in
Awards will not constitute an element of damages in the event of termination of
employment or service for any reason, even if the termination is in violation
of an obligation of the Company or Affiliate to the Participant.


 


(9)                                 SECTION 162(m).
The Administrator in its discretion may grant Performance Awards that are
intended to qualify for the performance-based compensation exception under Section 162(m) and
Performance Awards that are not intended so to qualify. In the case of an Award
intended to be eligible for the performance-based compensation exception under Section 162(m),
the Plan and such Award shall be construed to the maximum extent permitted by
law in a manner consistent with qualifying the Award for such exception. In the
case of a Performance Award intended to qualify as performance-based for the
purposes of Section 162(m), except as otherwise permitted by the
regulations at Treas. Regs. Section 1.162-27: (i) the Administrator
shall pre-establish in writing one or more specific Performance Criteria no
later than 90 days after the commencement of the period of service to which the
performance relates (or at such earlier time as is required to qualify the
Award as performance-based under Section 162(m)); (ii) payment of the
Award shall be conditioned upon prior certification by the Administrator that
the Performance Criteria have been satisfied; and (iii) if the Performance
Criteria with respect to the Award are not satisfied, no other Award shall be
provided in substitution of the Performance Award. The provisions of this Section 6.a.(9) shall
be construed in a manner that is consistent with the regulations under Section 162(m).


 


(10)                           OPTION AND SAR
REPRICING. Options and SARs may not be repriced, or replaced or repurchased for
cash, without the approval of the shareholders of the Company.


 


b.                                      AWARDS
REQUIRING EXERCISE


 


(1)                                 TIME AND MANNER
OF EXERCISE. Unless the Administrator expressly provides otherwise, (a) an
Award requiring exercise by the holder will not be deemed to have been
exercised until the Administrator receives a written notice of exercise (in
form acceptable to the Administrator) signed by the appropriate person and
accompanied by any payment required under the Award or adequate provision therefore,
as set forth in Section 4(b)(3); and (b) if the Award is exercised by
any person other than the Participant, the Administrator may require
satisfactory evidence that the person exercising the Award has the right to do
so.


 


(2)                                 EXERCISE PRICE.
The Administrator shall determine the exercise price of 


 


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each Stock Option and SAR; PROVIDED, that each Stock Option and SAR
must have an exercise price that is not less than the fair market value of the
Stock subject to the Stock Option and SAR, determined as of the date of grant.
An ISO granted to an Employee described in Section 422(b)(6) of the Code must
have an exercise price that is not less than 110% of such fair market value.


 


(3)                                 PAYMENT OF
EXERCISE PRICE, IF ANY. Where the exercise of an Award is to be accompanied by
payment, the Administrator may determine the required or permitted forms of
payment, subject to the following: (a) all payments will be by cash or
check acceptable to the Administrator, or, if so permitted by the Administrator
(with the consent of the optionee of an ISO if permitted after the grant), (i) through
the delivery of shares of Stock which have been outstanding for at least six
months (unless the Administrator approves a shorter period) and which have a
fair market value equal to the exercise price, (ii) by delivery of a
promissory note of the person exercising the Award to the Company, payable on
such terms as are specified by the Administrator, (iii) if the Stock is
publicly traded, by delivery of an unconditional and irrevocable undertaking by
a broker to deliver promptly to the Company sufficient funds to pay the
exercise price, or (iv) by any combination of the foregoing permissible
forms of payment; and (b) where shares of Stock issued under an Award are
part of an original issue of shares, the Award shall require an exercise price
equal to at least the par value of such shares.


 


(4)                                 GRANT OF STOCK
OPTIONS. Each Stock Option awarded under the Plan shall be deemed to have been
awarded as a non-ISO (and to have been so designated by its terms) unless the
Administrator expressly provides for ISO treatment that the Stock Option is to
be treated as an ISO.


 


c.                                       AWARDS NOT
REQUIRING EXERCISE


 


Awards of Restricted Stock and Unrestricted Stock may be made in return
for either (1) services determined by the Administrator to have a value
not less than the par value of the Awarded shares of Stock, or (2) cash or
other property having a value not less than the par value of the Awarded shares
of Stock plus such additional amounts (if any) as the Administrator may
determine payable in such combination and type of cash, other property (of any
kind) or services as the Administrator may determine.


 


d.                                      AWARDS OF
FULL-VALUE AWARDS


 


Notwithstanding
Section 4(a)(5) of this Plan, (1) Full-Value Awards to
Participants other than non-employee members of the Board of Directors that are
not Performance Awards shall vest (i.e., become free of forfeiture
restrictions) over a period of time at least three years or more from the date
of grant, and (2) Full-Value Awards that are Performance Awards shall be
subject to the attainment of Performance Criteria which require at least 12
months to achieve; 


 


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PROVIDED,
however that Full-Value Awards that aggregate not more than 5% of the number of
shares reserved for issuance under the Plan may be awarded without the vesting
requirements set forth in clauses (1) and (2).  For purposes of clarity, Full-Value Awards
issued to non-employee members of the Board of Directors will not be included
in determining whether the 5% threshold in the prior sentence has been
achieved.


 


e.                                       PERFORMANCE
AWARDS


 


Performance Awards may be granted to Participants as follows:
 
(1)                     Prior to the grant of any Performance Award, the Administrator shall establish for each such award (i) performance levels at which 100% of the award shall be earned and a range (which need not be the same for all awards) within which greater and lesser percentages shall be earned and (ii) a performance period (which shall not be less than 12 months) which shall be determined at time of grant.
 
(2)                     With respect to the performance levels to be established pursuant to paragraph 4.e.(1), the specific measures for each grant shall be established by the Administrator at the time of such grant. In creating these measures, the Administrator may establish the specific goals based upon or relating to any Performance Criteria (as defined below).
 
(3)                     Except as otherwise provided in paragraph 4.e.(5), the percentage of each Performance Award to be distributed to an employee shall be determined by the Administrator on the basis of the performance levels established for such award and on the basis of individual performance in satisfaction of the Performance Award during such period. Any Performance Award, as determined and adjusted pursuant to this paragraph and paragraphs 4.e.(5-8) is herein referred to as a “Final Award”. No distribution of any Final Award (or portion thereof) shall be made if the minimum performance level applicable to the related Performance Award is not achieved during the applicable performance period or, unless otherwise determined by the Administrator, if the employment of the employee to whom the related Performance Award was granted shall terminate for any reason whatsoever (including death) within 12 months after the date the Performance Award was granted.
 
(4)                     All Final Awards which have vested in accordance with the provisions of paragraphs 4.e.(5-10) shall be granted as soon as practicable following the end of the related vesting period. Final awards shall be granted in the form of Restricted Stock, Unrestricted Stock, Deferred Stock, Cash Performance Awards, or cash or any combination thereof, as the Administrator shall determine.
 
(5)                     Payment of any Final Award (or portion thereof) to an individual employee shall be subject to the continued rendering of services as an employee (unless this condition is waived by the Administrator).  If the Administrator shall determine 
 
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that such employee has failed to satisfy such conditions precedent, all Performance Awards granted to such employee which have not become Final Awards, and all Final Awards which have not been paid pursuant to paragraph 4.e.(10) shall be immediately canceled. Upon termination of an employee’s employment other than by death (whether such termination is before or after a Performance Award shall have become a Final Award), the Administrator may, but shall not in any case be required to, waive the condition precedent of continuing to render services.
 
(6)                     If, upon termination of an employee’s employment prior to the end of any performance period for a reason other than death, the Administrator shall determine to waive the condition precedent of continuing to render services as provided in paragraph 4.e.(5), the Performance Award granted to such employee with respect to such performance period shall be reduced pro rata based on the number of months remaining in the performance period after the month of such termination and such awards will be paid at the time they would have been paid absent an employment termination. The Final Award for such employee shall be determined by the Administrator (i) on the basis of the performance levels established for such award (including the minimum performance level) and the performance level achieved through the end of the performance period and (ii) in the discretion of the Administrator, on the basis of individual performance during the period prior to such termination. A qualifying leave of absence, determined in accordance with procedures established by the Administrator, shall not be deemed to be a termination of employment but, except as otherwise determined by the Administrator, the employee’s Performance Award will be reduced pro rata based on the number of months during which such person was on such leave of absence during the performance period. A Performance Award shall not vest during a leave of absence granted an employee for local, state, provincial, or federal government service.
 
(7)                     Upon termination of an employee’s employment by reason of death prior to the end of any performance period, the Performance Award granted to such employee with respect to such performance period, except as otherwise provided in paragraph 4.e.(3), shall be reduced pro rata based on the number of months remaining in the performance period after the month of such employee’s death. The percentage of the reduced Performance Award to be distributed to such employee shall be determined by the Administrator (i) on the basis of the performance levels established for such award (including the minimum performance level) and the performance level achieved through the end of the fiscal year during which such employee died and (ii) in the discretion of the Administrator, on the basis of individual performance during the applicable period. Such Final Awards will immediately vest and be paid as promptly as practicable.


 


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(8)                      If an employee is promoted during the performance period with respect to any Performance Award, such Performance Award may, in the discretion of the Administrator, be increased to reflect such employee’s new responsibilities.
 
(9)                     Performance Awards that have become Final Awards may be subject to a vesting schedule established by the Administrator. Except as otherwise provided in this Plan, no Final Award (or portion thereof) subject to a vesting schedule shall be paid prior to vesting and the unpaid portion of any Final Award shall be subject to the provisions of paragraph 4.e.(5). The Administrator shall have the authority to modify a vesting schedule as may be necessary or appropriate in order to implement the purposes of this Plan.
 
(10)               No holder of a Performance Award shall have any rights to dividends or interest or other rights of a stockholder with respect to a Performance Award prior to such Performance Award’s becoming a Final Award.
 
(11)               To the extent that any employee, former employee, or any other person acquires a right to receive payments or distributions under this Plan with respect to a Performance Award, such right shall be no greater than the right of a general unsecured creditor of the Company. All payments and distributions to be made hereunder shall be paid from the general assets of the Company. Nothing contained in this Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any employee, former employee, or any other person.
 


5.                                    EFFECT OF CERTAIN TRANSACTIONS


 


a.                                      MERGERS, ETC.
Immediately prior to a Covered Transaction (other than an Excluded Transaction
in which the outstanding Awards have been assumed or substituted for as
provided below), all outstanding Awards shall vest and, if relevant, become
exercisable, all Performance Criteria and other conditions to any Award shall
be deemed satisfied (and with respect to any Performance Awards, satisfied to
the extent that Final Awards with respect thereto shall have been deemed to
have been awarded in accordance with Section 4.e (subject to the
discretion of the Administrator as to the satisfaction of performance levels of
the Performance Award)), and all deferrals measured by reference to or payable
in shares of Stock shall be accelerated. Upon consummation of a Covered
Transaction, all Awards then outstanding and requiring exercise or delivery
shall terminate unless assumed by an acquiring or surviving entity or its
affiliate as provided below.


 


In the event of a Covered Transaction, the
Administrator may provide for substitute or replacement Awards from, or the
assumption of Awards by, the acquiring or surviving entity or its affiliates on
such terms as the Administrator determines.


 


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b.            CHANGES
IN AND DISTRIBUTIONS WITH RESPECT TO THE STOCK


 


(1)                                 BASIC
ADJUSTMENT PROVISIONS. In the event of a stock dividend, stock split or
combination of shares, recapitalization or other change in the Company’s
capital structure, the Administrator will make appropriate adjustments to the
maximum number of shares that may be delivered under the Plan under Section 2.a.
and to the maximum share limits described in Section 2.c., and will also
make appropriate adjustments to the number and kind of shares of stock or
securities subject to Awards then outstanding or subsequently granted, any
exercise prices relating to Awards and any other provision of Awards affected
by such change.


 


(2)                                 CERTAIN OTHER
ADJUSTMENTS. The Administrator may also make adjustments of the type described
in paragraph (1) above to take into account distributions to common
stockholders other than those provided for in Section 5.a. and 5.b.(1), or
any other event, if the Administrator determines that adjustments are
appropriate to avoid distortion in the operation of the Plan and to preserve
the value of Awards made hereunder; PROVIDED, that no such adjustment shall be
made to the maximum share limits described in Section 2.c., or otherwise
to an Award intended to be eligible for the performance-based exception under Section 162(m),
except to the extent consistent with that exception, nor shall any change be
made to ISOs except to the extent consistent with their continued qualification
under Section 422 of the Code.


 


(3)                                 CONTINUING
APPLICATION OF PLAN TERMS. References in the Plan to shares of Stock shall be
construed to include any stock or securities resulting from an adjustment
pursuant to Section 5.b.(1) or 5.b.(2) above.


 


6.                                    LEGAL CONDITIONS ON DELIVERY OF STOCK


 


The Company will not be obligated to deliver
any shares of Stock pursuant to the Plan or to remove any restriction from
shares of Stock previously delivered under the Plan until the Company’s counsel
has approved all legal matters in connection with the issuance and delivery of
such shares; if the outstanding Stock is at the time of delivery listed on any
stock exchange or national market system, the shares to be delivered have been
listed or authorized to be listed on such exchange or system upon official
notice of issuance; and all conditions of the Award have been satisfied or
waived. If the sale of Stock has not been registered under the Securities Act
of 1933, as amended, the Company may require, as a condition to exercise of the
Award, such representations or agreements as counsel for the Company may
consider appropriate to avoid violation of such Act. The Company may require
that certificates evidencing Stock issued under the Plan bear an appropriate
legend reflecting any restriction on transfer applicable to such Stock.


 


7.                                    AMENDMENT AND TERMINATION


 


Subject to the last sentence of Section 1,
the Administrator may at any time or times amend the Plan or any outstanding
Award for any purpose which may at the time be permitted by law, or may at any
time terminate the Plan as to any further grants of Awards; PROVIDED, that
(except to 


 


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the
extent expressly required or permitted by the Plan) no such amendment will,
without the approval of the stockholders of the Company, effectuate a change
for which stockholder approval is required under the rules of the New York
Stock Exchange (which includes any “material revision” as defined under the rules of
the New York Stock Exchange) or in order for the Plan to continue to qualify
under Section 422 of the Code and for Awards to be eligible for the
performance-based exception under Section 162(m).


 


8.                                    NON-LIMITATION OF THE COMPANY’S RIGHTS


 


The existence of the Plan or the grant of any
Award shall not in any way affect the Company’s right to award a person bonuses
or other compensation in addition to Awards under the Plan.


 


9.                                    GOVERNING LAW


 


The Plan shall be construed in accordance
with the laws of The Commonwealth of Massachusetts without reference to
principles of conflicts of laws.


 


10.                             DEFINED TERMS.


 


The following terms, when used in the Plan,
shall have the meanings and be subject to the provisions set forth below:


 


“ADMINISTRATOR”: The Board
or, if one or more has been appointed, the Committee. With respect to
ministerial tasks deemed appropriate by the Board or Committee, the term “Administrator”
shall also include such persons (including Employees) to whom the Board or
Committee shall have delegated such tasks.


 


“AFFILIATE”: Any corporation or other entity owning, directly or
indirectly, 50% or more of the outstanding Stock of the Company, or in which
the Company or any such corporation or other entity owns, directly or
indirectly, 50% of the outstanding capital stock (determined by aggregate
voting rights) or other voting interests.


 


“AWARD”: Any or a combination of the following (which shall include any
Final Award with respect to the following):


 


(i)                                     Stock Options.


 


(ii)                                  SARs.


 


(iii)                               Restricted
Stock.


 


(iv)                              Unrestricted Stock.


 


(v)                                 Deferred Stock.


 


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(vi)                              Cash
Performance Awards.


 


(vii)                           Other
Performance Awards.


 


(viii)                        Grants of cash
made in connection with other Awards in order to help defray in whole or in
part the economic cost (including tax cost) of the Award to the Participant.


 


“BOARD”: The Board of Directors of the Company.


 


“CASH PERFORMANCE AWARD”: A Performance Award payable in cash. The
right of the Company under Section 4.a.(3) (subject to the consent of
the holder of the Award as therein provided) to extinguish an Award in exchange
for cash or the exercise by the Company of such right shall not make an Award
otherwise not payable in cash a Cash Performance Award.


 


“CODE”: The U.S. Internal Revenue Code of 1986 as from time to time
amended and in effect, or any successor statute as from time to time in effect.


 


“COMMITTEE”: One or more committees of the Board (including any
subcommittee thereof) appointed or authorized to make Awards and otherwise to
administer the Plan. In the case of Awards granted to executive officers of the
Company, except as otherwise permitted by the regulations at Treas. Regs. Section 1.162-27,
the Committee shall be comprised solely of two or more outside directors within
the meaning of Section 162(m).


 


“COMPANY”: Charles River Laboratories International, Inc.


 


“COVERED TRANSACTION”: Any of (i) a consolidation or merger in
which the Company is not the surviving corporation or which results in any
individual, entity or “group” (within the meaning of section 13(d) of the
Securities Exchange Act of 1934) acquiring the beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) directly or
indirectly of more than 50% of either the then outstanding shares of common
stock of the Company or the combined voting power of the then outstanding
voting securities of the Company entitled to vote generally in the election of
directors, (ii) a sale or transfer of all or substantially all the Company’s
assets, or (iii) a dissolution or liquidation of the Company.


 


“DEFERRED STOCK”: A promise to deliver Stock or other securities in the
future on specified terms.


 


“EMPLOYEE”: Any person who is employed by the Company or an Affiliate.


 


“EXCLUDED TRANSACTION”: A Covered Transaction in which


 


(i)                                    the shares of
common stock of the Company or the voting securities of the Company entitled to
vote generally in the election of directors are acquired 


 


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directly from the Company;
or


 


(ii)                                 the shares of
common stock of the Company or the voting securities of the Company entitled to
vote generally in the election of directors are acquired by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company; or


 


(iii)                              (a) the
beneficial owners of the outstanding shares of common stock of the Company, and
of the securities of the Company entitled to vote generally in the election of
directors, immediately prior to such transaction beneficially own, directly or
indirectly, in substantially the same proportions immediately following such
transaction more than 50% of the outstanding shares of common stock and of the
combined voting power of the then outstanding voting securities entitled to
vote generally in the election of directors of the corporation (including,
without limitation, a corporation which as a result of such transaction owns
the Company or all or substantially all of the Company’s assets either directly
or through one or more subsidiaries) resulting from such transaction and (b) at
least a majority of the members of the board of directors of the corporation
resulting from such transaction were members of the board of directors at the
time of the execution of the initial agreement, or of the action of the Board,
authorizing such transaction.


 


“FULL-VALUE AWARD”: an Award
other than an Option or SAR, and which is settled by the issuance of shares of
Stock or the value of the stated number of shares in cash.


 


“FUNGIBLE
POOL UNIT”: the measuring unit used for purposes of the Plan, as specified in Section 2,
to determine the number of Shares which may be subject to Awards hereunder,
which shall consist of Shares in the proportions (ranging from 1.0  to 2.3) as set forth in Section 2(a).


 


“ISO”: A Stock Option intended to be an “incentive stock option” within
the meaning of Section 422 of the Code.


 


“PARTICIPANT”: An Employee, director or other person providing services
to the Company or its Affiliates who is granted an Award under the Plan.


 


“PERFORMANCE AWARD”: An Award subject to Performance Criteria
(including any Award that is a Final Award distributed in satisfaction of the
vesting of a Performance Award that was subject to Performance Criteria).


 


“PERFORMANCE CRITERIA”: Specified criteria the satisfaction of which is
a condition for the exercisability, vesting or full enjoyment of an Award. For
purposes of Performance Awards that are intended to qualify for the
performance-based compensation exception under Section 162(m), a Performance
Criterion shall mean an objectively determinable 


 


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measure of performance relating to any of the following (determined
either on a consolidated basis or, as the context permits, on a divisional,
subsidiary, line of business, project or geographical basis or in combinations
thereof): (i) sales; revenues; assets; liabilities; costs; expenses;
earnings before or after deduction for all or any portion of interest, taxes,
depreciation, amortization or other items, whether or not on a continuing
operations or an aggregate or per share basis; return on equity, investment,
capital or assets; one or more operating ratios; borrowing levels, leverage
ratios or credit rating; market share; capital expenditures; cash flow; working
capital requirements; stock price; stockholder return; sales, contribution or
gross margin, of particular products or services; particular operating or
financial ratios; customer acquisition, expansion and retention; or any combination
of the foregoing; or (ii) acquisitions and divestitures (in whole or in
part); joint ventures and strategic alliances; spin-offs, split-ups and the
like; reorganizations; recapitalizations, restructurings, financings (issuance
of debt or equity) and refinancings; transactions that would constitute a
change of control; or any combination of the foregoing. A Performance Criterion
measure and targets with respect thereto determined by the Administrator need
not be based upon an increase, a positive or improved result or avoidance of
loss.


 


“PLAN”: The Charles River Laboratories International, Inc. 2007
Incentive Plan as from time to time amended and in effect.


 


“PREEXISTING PLANS”: Any plan of the Company or its predecessors in
existence at or prior to March 22, 2007 under which equity, equity-based
or performance cash awards were granted, including, without limitation, the
following: (1) Charles River Laboratories International, Inc. 2000
Incentive Plan; (2) Charles River Laboratories Holdings, Inc. 1999
Management Incentive Plan; and (3) Charles River Laboratories
International, Inc. 2000 Directors Stock Plan.  For the purposes of this definition, “preexisting
plans” shall not refer to the Company’s Executive Incentive Compensation Plan
(EICP).


 


“RESTRICTED STOCK”: An Award of Stock subject to restrictions requiring
that such Stock be redelivered to the Company if specified conditions are not
satisfied.


 


“SECTION 162(m)”: Section 162(m) of the Code.


 


“SARS”: Rights entitling the holder upon exercise to receive cash or
Stock, as the Administrator determines, equal to a function (determined by the
Administrator using such factors as it deems appropriate) of the amount by
which the Stock has appreciated in value since the date of the Award.


 


“STOCK”: Common Stock of the Company.


 


“STOCK OPTIONS”: Options entitling the recipient to acquire shares of
Stock upon payment of the exercise price.


 


“UNRESTRICTED STOCK”: An Award of Stock not subject to any restrictions
under the Plan.


 


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11.                             SECTION 409A OF THE CODE


 


To the extent
applicable, the Plan is intended to comply with Section 409A of the Code
and the Administrator shall interpret and administer the Plan in accordance
therewith.  In addition, any provision in
this Plan document that is determined to violate the requirements of Section 409A
shall be void and without effect.  In
addition, any provision that is required to appear in this Plan document that
is not expressly set forth shall be deemed to be set forth herein, and such
Plan shall be administered in all respects as if such provisions were expressly
set forth.  The Administrator shall have
the authority unilaterally to accelerate or delay a payment to which the holder
of any Award may be entitled to the extent necessary or desirable to comply
with, or avoid adverse consequences under, Section 409A.


 


12.                             EFFECTIVE DATE OF THE PLAN


 


The Plan shall be effective as of the date of
its approval by the Board, subject to its approval by the stockholders of the
Company.


 


13.                             AWARDS UNDER PREEXISTING PLANS


 


Upon approval of the Plan by stockholders of
the Company as contemplated under Section 12, no further awards shall be
granted under the Preexisting Plans; PROVIDED, however, that any shares that
have been forfeited or cancelled in accordance with the terms of the applicable
award under a Preexisting Plan may be subsequently again awarded in accordance
with the terms of such Preexisting Plan.


 


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