Exhibit 10.11


 


LHP HOLDING CORP.


2004 RESTRICTED STOCK PLAN


 


ARTICLE
I


PURPOSES


 


The purposes of
the Plan are to foster and promote the long-term financial success of the
Company and the Subsidiaries and materially increase shareholder value by (a)
motivating superior performance by Participants by means of performance-related
incentives, (b) encouraging and providing for the acquisition of an
ownership interest in the Company by Employees and (c) enabling the
Company and the Subsidiaries to attract and retain the services of an
outstanding management team upon whose judgment, interest and special effort
the successful conduct of its operations is largely dependent.


 


ARTICLE II


DEFINITIONS


 


Section 2.1  Certain Definitions.  Whenever used herein, the following terms
shall have the respective meanings set forth below:


(a)  “Adjustment
Event” means any dividend payable in capital stock of the Company, and any
stock split, share combination, extraordinary cash dividend, recapitalization,
reorganization, merger, consolidation, split-up, spin-off, combination,
exchange of shares or other similar event, in each case, affecting the Common
Stock.


 


(b)  “Affiliate”
shall have the same meaning given to such term in the Stockholders Agreement.


 


(c)  “Assumed
Tax Rate” shall have the meaning specified in Section 7.2(a).


 


(d)  “Award”
means an award of the right to purchase shares of Common Stock pursuant to the
Plan.


 


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


 


(f)  “Call
Rights” means the First Call Right, the Second Call Right, and the
Post-Employment Call Right.


 


(g)  “Cause”
means, with respect to any Participant (as determined by the Board in its sole
discretion), (i) the willful failure by the Participant to substantially
perform his duties as an employee of the Company or any Subsidiary (other than
due to physical or mental illness), (ii) the Participant’s engaging
in willful or serious misconduct that has caused or could reasonably be
expected to result in material injury to the Company or any Affiliate thereof
including, but not


 





















 


limited to, by way of damage to the reputation or
public standing of the Company or any Affiliate thereof, (iii) the
Participant’s conviction of, or entering a plea of guilt or nolo  contendere
to, a crime that constitutes a felony or involving moral turpitude, or (iv)
the Participant’s material violation or breach of any written Company policy or
rule or the material breach by the Participant of any of his obligations under
any written covenant or agreement with the Company or any Affiliate thereof; provided,
that with respect to any Participant who is party to an employment agreement
with the Company or any Subsidiary, “Cause” shall have the meaning specified in
such employment agreement.


 


(h)  “Change
of Control” means, with respect to the Company, the first to occur after
the effective date of the Plan of any of the following events:


 


(i)  the
acquisition by any person, entity or group (as defined in section 13(d) of the
Securities Exchange Act of 1934, as amended) (other than (A) the Company
and the Subsidiaries, (B) any employee benefit plan of the Company or
the Subsidiaries, or (C) the Investors (as defined in the Consulting
Agreement, dated as of May 27, 2004, by and among the Company and the other
parties thereto, as amended from time to time) or any Affiliate or partner
thereof) through one transaction or a series of transactions of 50% or more of
the combined voting power of the then outstanding voting securities of the
Company;


 


(ii)  the merger
or consolidation of the Company as a result of which persons who were
stockholders of the Company immediately prior to such merger or consolidation,
do not, immediately thereafter, own, directly or indirectly, more than 50% of
the combined voting power entitled to vote generally in the election of
directors of the merged or consolidated company;


 


(iii)  the
liquidation or dissolution of the Company (other than a dissolution occurring
upon a merger or consolidation thereof); and


 


(iv)  the sale,
transfer or other disposition of all or substantially all of the assets of the
Company through one transaction or a series of related transactions to one or
more persons or entities that are not, immediately prior to such sale, transfer
or other disposition, Affiliates of the Investors.


 


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


 


(j)  “Committee”
means the Compensation Committee of the Board (or such other committee of the
Board as the Board shall designate) or, if there shall not be any such
committee then serving, the Board.


 


(k)  “Common
Stock” means one share of common stock, par value $.01 per share, of the
Company.


 


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(l)  “Company”
means LHP Holding Corp., a Delaware corporation, and any successor thereto.


 


(m)  “Disability”
means a physical or mental disability or infirmity that prevents, or is
reasonably expected to prevent (based on an independent physician’s medical
examination), the performance by a Participant of his duties hereunder for a
continuous period of 90 days or longer or for 180 days or more in any 12-month
period.  The reasoned and good faith
judgment of the Board as to Disability shall be final, binding and
conclusive.  Notwithstanding the
foregoing definition, with respect to any Participant who is party to an
employment agreement with the Company or any Subsidiary, “Disability” shall
have the meaning specified in such employment agreement.


 


(n)  “Employee”
means any officer or key employee of the Company or any Subsidiary.


 


(o)  “Fair
Market Value” means, as of any date, with respect to the Common Stock, the
fair market value on such date per share of Common Stock as determined by the
Board in its sole discretion. 
Notwithstanding the foregoing, following a Public Offering, Fair Market
Value with respect to the Common Stock that is listed for trading shall mean
the average of the high and low trading prices for a share of the Common Stock
on the primary national exchange (including NASDAQ) on which the Common Stock
is then traded on the trading day immediately preceding the date as of which
such Fair Market Value is determined. 
The determination of Fair Market Value will not give effect to any
restrictions on the shares of the Common Stock (including transferability
restrictions and Call Rights) or the fact that such shares would represent a
minority interest in the Company.


 


(p)  “First
Call Right” shall have the meaning specified in Section 6.6(a).


 


(q)  “Good
Reason” means any termination by a Participant of his employment with the
Company, by written notice to the Company specifying in reasonable detail the
circumstances claimed to provide the basis for such termination, within 30 days
following the occurrence, without the Participant’s consent, of any of the
following events and the failure of the Company to correct the circumstances
set forth in the Participant’s written notice within 30 days of receipt of such
notice: (i) the assignment to the Participant of duties that are
significantly different from, and that result in a substantial diminution of,
the duties that he has as an employee; provided,
that a corporate reorganization by the Company and/or its Affiliates pursuant
to which the Company ceases to exist or the Participant’s title is changed
shall not constitute Good Reason hereunder so long as there is no substantial
diminution and significant difference in the nature of Executive’s duties, and
(ii) a reduction in the rate of the Participant’s base salary (other
than a proportionate adjustment applicable generally to similarly situated
Company executives).  Notwithstanding the
foregoing definition, with respect to any Participant who is party to an
employment agreement with the


 


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Company or any Subsidiary, “Good Reason” shall have
the meaning specified in such employment agreement.


 


(r)  “Option
Plan Value” shall have the meaning specified in Section 7.2(b)(ii).


 


(s)  “Participant”
means any Employee designated by the Board to receive an Award under the Plan.


 


(t)  “Payments”
shall have the meaning specified in Section 7.3.


 


(u)  “Plan”
means this LHP Holding Corp. 2004 Restricted Stock Plan, as amended from time
to time.


 


(v)  “Post-Employment
Call Right” shall have the meaning specified in Section 6.6(c).


 


(w)  “Public
Offering” shall have the same meaning given to such term in the
Stockholders Agreement.


 


(x)  “Purchase
Price” shall have the meaning specified in Section 6.1.


 


(y)  “Retirement”
means the termination of a Participant’s employment with the Company and any
Subsidiary on or after the date the Participant attains age 65 or such earlier
date as determined by the Board in its sole discretion; provided, that, with respect to
any Participant who is party to an employment agreement with the Company or any
Subsidiary, “Retirement” shall have the meaning specified in such employment
agreement.


 


(z)  “Second
Call Right” shall have the meaning specified in Section 6.6(b).


 


(aa)  “Stockholders
Agreement” means the Stockholders Agreement, dated as of May 27, 2004, by
and among the Company, the other parties thereto and each other person who
becomes a party thereto, as amended or superseded from time to time.


 


(bb)  “Stock
Plan Value” shall have the meaning specified in Section 7.2(b)(i).


 


(cc)  “Subscription
Agreement” means the subscription agreement, substantially in the form
attached hereto as Exhibit A or such other form as the Board shall approve, to
be entered into by the Company and the Participant in connection with the
purchase by a Participant of any shares of Common Stock pursuant to Article VI
hereof.


 


(dd)   “Subsidiary”
means any corporation in which the Company owns, directly or indirectly, stock
representing 50% or more of the combined voting


 


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power of all classes of stock entitled to vote, and
any other business organization, regardless of form, in which the Company
possesses, directly or indirectly, 50% or more of the total combined equity
interests in such organization.


 


Section 2.2  Gender and Number.  Except when otherwise indicated by the
context, words in the masculine gender used in the Plan shall include the
feminine gender, the singular shall include the plural, and the plural shall
include the singular.


 


ARTICLE III


ELIGIBILITY


 


Participants in
the Plan shall be those Employees selected by the Board to participate in the
Plan.  The selection of an Employee as a
Participant shall neither entitle such Employee to, nor disqualify such
Employee from, participation in any other incentive plan of the Company.


ARTICLE IV


ADMINISTRATION


 


Section 4.1  Power to Grant and Establish Terms of
Awards.  The Board shall have the
discretionary authority, subject to the terms of the Plan, to determine the
Employees to whom Awards shall be granted and the terms and conditions of such
Awards including, but not limited to, the number of shares of Common Stock
subject to an Award, the time or times at which Awards shall be granted, and
the terms and conditions of the Subscription Agreements.


 


Section 4.2  Administration.  The Board shall be responsible for the
administration of the Plan.  The Board
shall have discretionary authority to prescribe, amend and rescind rules and
regulations relating to the Plan, to provide for conditions deemed necessary or
advisable to protect the interests of the Company and the Subsidiaries, to
interpret the Plan and to make all other determinations necessary or advisable
for the administration and interpretation of the Plan and to carry out its
provisions and purposes.  Any
determination, interpretation or other action made or taken (including any
failure to make any determination or interpretation, or take any other action)
by the Board pursuant to the provisions of the Plan shall be final, binding and
conclusive for all purposes and upon all persons, and shall be given deference
in any proceeding with respect thereto. 
The Board may consult with legal counsel, who may be counsel to the
Company, and shall not incur any liability for any action taken in good faith
in reliance upon the advice of counsel.


 


Section 4.3  Delegation by the Board.  All of the powers, duties and
responsibilities of the Board specified in the Plan may, to the full extent
permitted by applicable law, be exercised and performed by the Committee to the
extent authorized by the Board to exercise and perform such powers, duties and
responsibilities.


 


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ARTICLE V


STOCK SUBJECT TO PLAN


 


Section 5.1  Number.  Subject to the provisions of Section 5.3, the
number of shares of Common Stock subject to Awards plus the number of shares of
Common Stock subject to Subscription Agreements may not exceed 195,676 shares
in the aggregate.  Notwithstanding the
foregoing, at any such time as the offer and sale of securities pursuant to
this Plan is subject to compliance with Section 260.140.45 of Title 10 of the
California Code of Regulations (as amended from time to time), the total number
of shares of Common Stock subject to the Plan (together with equity-based
awards under any other incentive plan of the Company) and the total number of
shares available for award under any stock bonus or similar plan of the Company
shall not exceed thirty percent (30%) (or such other higher percentage
limitation as may be approved by the shareholders of the Company pursuant to Section
260.140.45) of the then outstanding shares of the Company as calculated in
accordance with the conditions and exclusions of Section 260.140.45.


 


Section 5.2  Canceled, Terminated, or Forfeited Awards.  Any shares of Common Stock subject to an
Award that for any reason expires or is canceled, terminated, forfeited,
substituted for or otherwise settled without the issuance of such shares of
Common Stock shall again be available for award under the Plan.  Any shares of Common Stock subject to a
Subscription Agreement that for any reason are repurchased by the Company shall
again be available for award under the Plan.


 


Section 5.3  Adjustments in Capitalization.  If the Board determines in its sole
discretion that, as a result of any Adjustment Event, an adjustment is
necessary or appropriate to preserve, or to prevent enlargement of, the
benefits or potential benefits made available under the Plan, then the Board
shall, in such manner as the Board shall deem equitable, adjust any or all of (a)
the number and kind of shares that thereafter may be awarded under the Plan, (b)
the number and kind of shares subject to outstanding Awards, and (c) the
number and kind of shares subject to Subscription Agreements and the Purchase
Price (as defined below) for shares subject to Subscription Agreements.  In addition, the Board may make provisions
for a cash payment to any and all Participants in respect of their shares of
Common Stock subject to Subscription Agreements.  Further, in connection with any such
adjustment, the number of shares of Common Stock subject to any Award and the
number of shares of Common Stock subject to any Subscription Agreement shall be
rounded to the nearest whole number.


 


ARTICLE VI


AWARDS; TERMS OF COMMON STOCK


 


Section 6.1  Grant of Awards.  Awards may be granted to Participants at such
time or times as the Board shall determine. 
At the time of grant of an Award, the Board shall determine the number
of shares of Common Stock subject to such Award, the purchase price thereof
(which shall not be less than the Fair Market Value on the date of grant or
purchase) (the “Purchase Price”) and the duration of the Award.  Each purchase of Common Stock pursuant to an
Award shall be consummated pursuant to a


 


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Subscription Agreement,
which shall include such terms and conditions not inconsistent with the Plan as
the Board shall determine including, but not limited to, customary
representations, warranties and covenants with respect to securities law
matters.  The Board may establish
different terms and conditions for different Participants receiving Awards and
for the same Participant for each Award such Participant may receive, whether
or not granted at different times.  The
grant of any Award to any Employee shall not entitle such Employee to the grant
of any other Awards.


 


Section 6.2  Stockholders Agreement.  Each Participant who purchases shares of
Common Stock shall be entitled to the benefits of and be bound by the
obligations set forth in the Stockholders Agreement and shall be deemed to be a
Management Stockholder (as defined in the Stockholders Agreement) thereunder,
and as a condition to receipt of any shares of Common Stock, the Participant
shall from time to time, as requested by the Company, execute and deliver a
joinder to the Stockholders Agreement evidencing the forgoing (and such
holder’s spouse will execute and deliver any spousal consent requested for
community property reasons or otherwise).


 


Section
6.3  Restrictions on Transferability.  Except as provided in Article VII, as
otherwise expressly provided in any Subscription Agreement or as permitted by
the Board, no Common Stock may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated (other than by will or by the laws of
descent and distribution; provided, that such
recipient shall be bound by the terms of the Plan, any applicable Subscription
Agreement and the Stockholders Agreement) until the lapse of the Call Rights
for any reason.  Thereafter, shares of
Common Stock purchased hereunder may only be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated in compliance with applicable
securities laws, the Plan, the Subscription Agreement, the Stockholders
Agreement and any other agreement to which such Common Stock is subject, or by
will or the laws of descent and distribution (provided that such recipient shall be bound by
the provisions of the Plan and any applicable Subscription Agreement).


 


Section 6.4  Rights as Stockholder.  Except as otherwise expressly provided in any
Subscription Agreement or in the Stockholders Agreement, each Participant who
holds shares of Common Stock purchased hereunder may exercise any voting or
other rights as a stockholder of the Company with respect to such shares; provided,
that a certificate or certificates in respect of such shares have been issued
to such Participant, and such Participant has executed and delivered a
Subscription Agreement.


 


Section 6.5  Dividends and Distributions.  Except as otherwise expressly provided in any
Subscription Agreement or in the Stockholders Agreement, each Participant
shall, with respect to the shares of Common Stock purchased hereunder by the
Participant that remain outstanding as of the record date of any dividend or
distribution, be entitled to receive all dividends and distributions paid in
respect of such shares; provided that, if
any such dividends or distributions are paid in shares of Common Stock or other
property, such shares and such other property shall be subject to the same Call
Rights and other restrictions as apply to the Common Stock with respect to
which they were paid.


 


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Section 6.6  Rights Upon and After Termination of
Employment.  Except as otherwise
expressly provided in any Subscription Agreement, each Subscription Agreement
shall provide that the Company shall have (subject to such
additional terms and conditions as set forth in the applicable Subscription
Agreement):


 


(a)  the right
(the “First Call Right”) to repurchase all or a portion of the shares
subject to the First Call Right upon the termination of a Participant’s
employment with the Company and any Subsidiary that employs the Participant for
any reason, at a purchase price equal to the lower of their aggregate Purchase
Price and their aggregate Fair Market Value. 
The number of shares of Common Stock that shall be subject to the First
Call Right as of any termination date shall be equal to the number of shares of
Common Stock purchased hereunder by the Participant that remain outstanding as
of the date of such termination, multiplied by a fraction, the numerator of
which shall equal four minus the number of full years from the purchase date
(or such other date as the Board shall determine) to the employment termination
date (but not less than zero), and the denominator of which shall equal four,
and


 


(b)  the right
(the “Second Call Right”) to repurchase all or any portion of the shares
of Common Stock subject to the Second Call Right upon the termination of a
Participant’s employment (i) (A) by the Company for Cause at any
time, or (B) by the Participant without Good Reason during the six year
period beginning from the purchase date (or such other date as the Board shall
determine) of such shares, in either case, at a purchase price equal to the
lower of their aggregate Purchase Price and their aggregate Fair Market Value,
and (ii) for any other reason during the six year period beginning from
the purchase date (or such other date as the Board shall determine) of such
shares, their aggregate Fair Market Value; provided that, if Holdings
does not purchase the Participant’s shares pursuant to the Second Call Right
and the Participant’s employment is terminated as a result of the Participant’s
death or Disability, the Participant (or the Participant’s estate) shall have
the right (following the expiration of Holdings’ right under this Section
6.6(b)) to require Holdings to buy all of the shares subject to the Second Call
Right.  The number of
shares of Common Stock that shall be subject to the Second Call Right as of any
termination date shall be equal to the number of shares of Common Stock
purchased hereunder by the Participant that remain outstanding and are no
longer subject to the First Call Right, in each case, as of the date of such
termination, and


 


(c)  the right
(the “Post-Employment Call Right”) to repurchase all or any or portion
of the shares subject to the Post-Employment Call Right upon
any breach of any post-termination non-competition, non-solicitation,
confidentiality, or other similar agreement or covenant with the Company, at a
purchase price equal to the lower of their aggregate Purchase Price and their
aggregate Fair Market Value.  The number
of shares of Common Stock that shall be subject to the Post-Employment Call
Right as of the date of any such breach shall be equal to the number of shares
of Common Stock purchased hereunder by the Participant that remain outstanding
as of the date of such breach.


 


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ARTICLE VII


CHANGE OF CONTROL


 


Section 7.1  Lapse of Rights.  Notwithstanding anything else contained in
the Plan, except as otherwise expressly provided in any Subscription Agreement,
in the event of a Change of Control, the Call Rights applicable to any shares
of Common Stock purchased hereunder shall automatically expire.  For the avoidance of doubt, the restrictions
contained in this Plan (including, but not limited to, the Call Rights that
lapse pursuant to the immediately preceding sentence) and any applicable
Subscription Agreement shall not preclude such shares of Common Stock from
participating in any Change of Control.


 


Section
7.2  Exit Bonus.


 


(a)  In
General.  Except as otherwise
expressly provided in any Subscription Agreement, in the event of a Change of
Control, the Board will compare the Stock Plan Value with the Option Plan Value
for each Participant who is employed by the Company or any Subsidiary through
the date of such Change of Control.  To
the extent that the Option Plan Value exceeds the Stock Plan Value and provided
that such Participant is employed by the Company or any Subsidiary through the
date of the Change of Control, such Participant shall receive within 30 days
after the Change of Control a cash bonus equal to such excess, plus an
additional amount such that, after payment of all taxes incurred by a
Participant on the receipt of such cash bonus, the Participant retains the same
after-tax amount that he would have retained had such payment not been subject
to tax (calculated assuming that a Participant’s combined federal, state and
local marginal income tax rate is equal to the combined marginal tax rate which
would be applicable to such Participant based solely on the income derived by
such Participant for the last completed fiscal year of the Company and the
rates applicable to a person working and residing in the jurisdiction in which
such Participant works and resides (the “Assumed Tax Rate”)).


 


(b)  Certain
Definitions; Calculations.


 


(i)  “Stock
Plan Value” means the after-tax value a Participant receives in connection
with the Change of Control in respect of the shares of Common Stock purchased
hereunder by the Participant that remain outstanding immediately prior to the
date of such Change of Control, plus the after-tax value of any dividends and
distribution received by such Participant prior to the date of the Change of
Control.


 


(ii)  “Option
Plan Value” means the after-tax value the Participant would have received
had the Investors made their investments in the Company in Common Stock and
established a 10% option pool (fully diluted) at the time this Plan was
adopted.  For the avoidance of doubt,
Option Plan Value shall be calculated assuming that the Participant was not
entitled to receive any dividends or distributions in respect of the


 


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shares of Common Stock underlying the Participant’s
hypothetical options, and that such options were cashed out in connection with
the Change of Control.


 


(iii)  Calculations;
Determinations.  All calculations and
determinations made by the Board pursuant to this Section 7.2 shall be in the
Board’s sole discretion, shall be final, binding and conclusive upon all
persons and for all purposes, and shall be made as of the date of the Change of
Control using the Assumed Tax Rate and using the aggregate Purchase Price of
the Participant’s shares of Common Stock as the aggregate exercise price for
the hypothetical options.


 


Section 7.3  Limitation on Benefits.  Notwithstanding anything to the contrary
contained in the Plan or any Subscription Agreement, to the extent that any of
the payments and benefits provided for under the Plan, any applicable
Subscription Agreement or any other agreement or arrangement between the
Company and a Participant (collectively, the “Payments”) would
constitute a “parachute payment” within the meaning of section 280G of the
Code, the amount of such Payments shall be reduced to the amount that would
result in no portion of the Payments being subject to the excise tax imposed
pursuant to section 4999 of the Code.  If
any Payments that would be reduced, pursuant to the immediately preceding
sentence but would not be so reduced if the stockholder approval requirements
of section 280G(b)(5) of the Code are satisfied, the Company shall use its
reasonable best efforts to cause such payments to be submitted for such
approval prior to the Change of Control giving rise to such payments.


 


ARTICLE VIII


EFFECTIVE DATE, AMENDMENT AND
TERMINATION


 


The Plan shall be
effective upon adoption by the Board or such later date, as the Board shall
specify, and shall expire on the tenth anniversary thereof (except as to
outstanding Awards and shares subject to Subscription Agreements), unless
sooner terminated pursuant to this Article VIII.  The Board at any time may terminate or
suspend the Plan, and from time to time may amend or modify the Plan.  No termination, suspension, amendment or
modification of the Plan shall (except in the case of an adjustment pursuant to
Section 5.3 hereof) in any manner adversely affect any Award theretofore
granted under the Plan or any shares subject to a Subscription Agreement,
without the consent of the Participant holding such Award.  Shareholder approval of any such termination,
suspension, amendment or modification shall be obtained to the extent mandated
by applicable law, or if otherwise deemed appropriate by the Board.


ARTICLE
IX 


MISCELLANEOUS


 


Section 9.1  Nontransferability of Awards.  No Award may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution.


 


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Section 9.2  Beneficiary Designation.  Each Participant under the Plan may from time
to time name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit under the Plan is to be paid or by whom any
right under the Plan is to be exercised in case of his or her death.  Each designation will revoke all prior designations
by the same Participant, shall be in a form prescribed by the Board and will be
effective only when filed by the Participant in writing with the Board during
his lifetime.  In the absence of any such
designation, benefits remaining unpaid or Awards or shares subject to any
Subscription Agreement outstanding at the Participant’s death shall be paid to
or exercised by the Participant’s surviving spouse, if any, or otherwise to or
by his estate.


 


Section 9.3  Tax Withholding.  The Company and each Subsidiary shall have
the power to withhold, or require a Participant to remit to the Company or any
Subsidiary promptly upon notification of the amount due, an amount determined
by the Company or such Subsidiary, in its discretion, to be sufficient to satisfy
all Federal, state, local and foreign withholding tax requirements in respect
of any Award or shares subject to any Subscription Agreement and the Company
may (or may cause a Subsidiary to) defer payment of cash or issuance or
delivery of Common Stock until such requirements are satisfied.  The Board may permit or require a Participant
to satisfy his tax withholding obligation hereunder in such other manner,
subject to such conditions, as the Board shall determine.


 


Section 9.4  Requirements of Law.  The grant of Awards and the issuance of
shares of Common Stock shall be subject to all applicable laws, rules and
regulations, and to such approvals by any governmental agencies or national or
foreign securities exchanges as may be appropriate or required, as determined
by the Board.  Notwithstanding any other
provision of the Plan or any Subscription Agreement, no Awards shall be
granted, and no shares of Common Stock shall be issued in connection with any
Award, if such grant or issuance would result in a violation of applicable law,
including the federal securities laws and any applicable state or foreign
securities laws.


 


Section 9.5  No Guarantee of Employment or
Participation.  Nothing in the Plan
shall interfere with or limit in any way the right of the Company or any
Subsidiary to terminate any Participant’s employment at any time and for any
reason, nor confer upon any Participant any right to continue in the employ of
the Company or any Subsidiary.  No
Employee shall have a right to be selected as a Participant or, having been so
selected, to receive any Awards.


 


Section 9.6  No Limitation on Compensation.  Nothing in the Plan shall be construed to
limit the right of the Company or any Subsidiary to establish other plans or to
pay compensation to its employees in cash or property, in a manner that is not
expressly authorized under the Plan.


 


Section 9.7  No Right to Particular Assets.  Nothing contained in this Plan and no action
taken pursuant to this Plan shall create or be construed to create a trust of
any kind or any fiduciary relationship between the Company and the
Subsidiaries, on the one hand, and any Participant or executor, administrator
or other personal representative or


 


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designated beneficiary of such Participant, on the
other hand, or any other persons.  Any
reserves that may be established by the Company or any Subsidiary in connection
with this Plan shall continue to be held as part of the general funds of the
Company, and no individual or entity other than the Company shall have any
interest in such funds until paid to a Participant.  To the extent that any Participant or his
executor, administrator or other personal representative, as the case may be,
acquires a right to receive any payment from the Company or a Subsidiary
pursuant to this Plan, such right shall be no greater than the right of an
unsecured general creditor of the Company or such Subsidiary.


 


Section 9.8  No Impact On Benefits.  Awards shall not be treated as compensation
for purposes of calculating an Employee’s rights under any employee benefit
plan, except to the extent provided in any such plan.


 


Section 9.9  Freedom of Action.  Subject to Article VII, nothing in the Plan
or any Subscription Agreement shall be construed as limiting or preventing the
Company or any Subsidiary from taking any action with respect to the operation
or conduct of its business that it deems appropriate or in its best interest.


 


Section 9.10  Governing Law.  The Plan, and all Subscription Agreements
hereunder, shall be construed in accordance with and governed by the laws of
the State of Delaware without regard to principles of conflicts of laws.


 


Section
9.11  Severability; Blue Pencil. 
In the event that any one or more of the provisions of this Plan or any
Subscription Agreement shall be or become invalid, illegal or unenforceable in
any respect, the validity, legality and enforceability of the remaining
provisions contained herein or therein shall not be affected thereby.  If, in the opinion of any court of competent
jurisdiction any covenant or covenants of the Plan or any Subscription
Agreement are not reasonable in any respect, such court shall have the right,
power and authority to excise or modify such provision or provisions of such covenants
as to the court shall appear not reasonable and to enforce the remainder of
these covenants as so amended.


 


Section 9.12  Indemnification.  Each person who is or shall have been a
member of the Board or the Committee shall be indemnified and held harmless by
the Company to the fullest extent permitted by law against and from any loss,
cost, liability or expense (including any related attorneys’ fees and advances
thereof) that may be imposed upon or reasonably incurred by him in connection
with, based upon or arising or resulting from any claim, action, suit or
proceeding to which he may be made a party or in which he may be involved by
reason of any action taken or failure to act under or in connection with the
Plan or any Subscription Agreement and against and from any and all amounts
paid by him in settlement thereof, with the Company’s approval, or paid by him
in satisfaction of any judgment in any such action, suit or proceeding against
him; provided that he shall give the
Company an opportunity, at its own expense, to handle and defend the same
before he undertakes to handle and defend it on his own behalf.  The foregoing right of indemnification shall
not be exclusive and shall be independent of any other rights of
indemnification to which such persons may be entitled under the Company’s
Articles of Incorporation or By-laws, by contract, as a matter of law or
otherwise.


 


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Section 9.13  Notices.  Each Participant shall be responsible for
furnishing the Company with the current and proper address for the mailing of
notices and delivery of agreements and certificates.  Any notices required or permitted to be given
shall be deemed given if directed to the person to whom addressed at such
address and mailed by regular United States mail, first-class and
prepaid.  If any item mailed to such
address is returned as undeliverable to the addressee, mailing will be
suspended until the Participant furnishes the proper address.


 


Section 9.14  Incapacity.  Any benefit payable to or for the benefit of
a minor, an incompetent person or other person incapable of receiving such
benefit shall be deemed paid when paid to such person’s guardian or to the
party providing or reasonably appearing to provide for the care of such person,
and such payment shall fully discharge the Board, the Committee, the Company
and other parties with respect thereto.


 


Section 9.15  Rights Cumulative; Waiver.  The rights and remedies of Participants and
the Company under this Plan shall be cumulative and not exclusive of any rights
or remedies which either would otherwise have hereunder or at law or in equity
or by statute, and no failure or delay by either party in exercising any right
or remedy shall impair any such right or remedy or operate as a waiver of such
right or remedy, nor shall any single or partial exercise of any power or right
preclude such party’s other or further exercise or the exercise of any other
power or right.  The waiver by any party
hereto of a breach of any provision of the Plan shall not operate or be
construed as a waiver of any preceding or succeeding breach and no failure by
either party to exercise any right or privilege hereunder shall be deemed a
waiver of such party’s rights or privileges hereunder or shall be deemed a
waiver of such party’s rights to exercise the same at any subsequent time or
times hereunder.


 


Section 9.16  Headings and Captions.  The headings and captions herein are provided
for reference and convenience only, shall not be considered part of this Plan
and shall not be employed in the construction of this Plan


 


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