Exhibit 10.2


 


GRIFFON
CORPORATION


 


2011 Equity
INCENTIVE PLAN


 


(as
amended and restated on January 30, 2013)


 


1. Purpose.
The purpose of the Griffon Corporation 2011 Equity Incentive Plan (the “Plan”) is to attract, motivate and
retain selected employees, consultants and non-employee directors for the Company and its subsidiaries, to provide such
persons with incentives and rewards for superior performance and to better align the interests of such persons with the
interests of the Company’s stockholders.


 


2.Definitions.
As used in this Plan, the following terms shall be defined as set forth below:


 


2.1.“Award” means
any Performance Shares, Performance Units, Options, Stock Appreciation Rights, Restricted Shares, Deferred Shares or Other Stock-Based
Awards granted under the Plan.


 


2.2.“Award Agreement”
means an agreement, certificate, resolution or other form of writing or other evidence approved by the Committee that sets forth
the terms and conditions of an Award. An Award Agreement may be in an electronic medium, or may be limited to a notation on the
Company’s books or records, but shall be signed by a representative of the Company and the Participant unless otherwise approved
by the Committee.


 


2.3.“Base Price” means
the price used as the basis for determining the Spread upon the exercise of Stock Appreciation Right.


 


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


 


2.5.“Cause” means,
(a) if the applicable Participant is party to an effective employment, consulting, severance or similar agreement with the Company
or any of its Subsidiaries, the meaning of such term as defined therein; (b) if the applicable Participant is not a party to an
effective employment, consulting, severance or similar agreement or if no definition of “Cause” is set forth in the
applicable employment, consulting, severance or similar agreement, “Cause” shall have the same meaning as such term
is defined in the applicable Award Agreement; and (c) if the applicable Participant is not a party to any effective employment,
consulting, severance or similar agreement or no definition of “Cause” is set forth in the applicable employment, consulting,
severance or similar agreement, and no definition of “Cause” is set forth in the applicable Award Agreement, “Cause”
shall mean (i) engaging in (A) willful or gross misconduct or (B) willful or gross neglect; (ii) failing to adhere to the directions
of superiors or the Board or the written policies and practices of the Company or its Subsidiaries or affiliates; (iii) the commission
of a felony or a crime involving any of the following: moral turpitude, dishonesty, breach of trust or unethical business conduct;
or the commission of any crime involving the Company or its Subsidiaries or affiliates; (iv) fraud, misappropriation or embezzlement;
(v) a material breach of the Participant’s employment agreement (if any) with the Company or its Subsidiaries or affiliates;
(vi) acts or omissions constituting a material failure to perform substantially and adequately the duties assigned to the Participant;
(vii) any illegal act detrimental to the Company or its Subsidiaries or affiliates; or (viii) repeated failure to devote



    	 



    	



    

substantially
all of the Participant’s business time and efforts to the Company if required by the Participant’s employment agreement.


 


2.6.“Change in Control”
means, after the Effective Date:


 


(i)the acquisition, directly
or indirectly, by a “person” (within the meaning of Section 13(d)(3) of the Exchange Act) (a “Person”)
of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of more than 20% of the combined
voting power of the voting securities of the Company entitled to vote generally in the election of directors (the “Voting
Securities”); provided, however, that the following acquisitions shall not constitute a Change in Control: (a) any acquisition
by or from the Company or any Subsidiary, or by any employee benefit plan (or related trust) sponsored or maintained by the Company
or any Subsidiary, (b) any acquisition by an individual who as of the Effective Date is a member of the Board, (c) any acquisition
by any underwriter in any firm commitment underwriting of securities to be issued by the Company, or (d) any acquisition by any
corporation (or other entity) if, immediately following such acquisition, 65% or more of the then outstanding shares of common
stock (or other equity unit) of such corporation (or other entity) and the combined voting power of the then outstanding voting
securities of such corporation (or other entity), are beneficially owned, directly or indirectly, by all or substantially all of
the individuals or entities who, immediately prior to such acquisition, were the beneficial owners of the then outstanding Shares
and the Voting Securities in substantially the same proportions, respectively, as their ownership immediately prior to the acquisition
of the Stock and Voting Securities; or


 


(ii)the consummation of the
sale or other disposition of all or substantially all of the assets of the Company, other than to a wholly-owned Subsidiary or
to a holding company of which the Company is a direct or indirect wholly owned subsidiary prior to such transaction; or


 


(iii)the consummation of a reorganization,
merger or consolidation of the Company, other than a reorganization, merger or consolidation, which would result in the Voting
Securities outstanding immediately prior to the transaction continuing to represent (whether by remaining outstanding or by being
converted to voting securities of the surviving entity) 65% or more of the Voting Securities or the voting power of the voting
securities of such surviving entity outstanding immediately after such transaction; or


 


(iv)the consummation of a plan
of complete liquidation or substantial dissolution of the Company; or


 


(v)the following individuals
cease for any reason to constitute a majority of the Board: individuals who, as of the Effective Date, constitute the Board and
any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election
contest, including, but not limited to, a consent solicitation relating to the election of directors of the Company) whose appointment
or election by the Board or nomination for election by the Company’s stockholders was approved and recommended by a vote
of at least two-thirds of the directors then still in office who



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either
were directors on the Effective Date or whose appointment, election or nomination for election was previously so approved or recommended;
or


 


(vi)the sale, transfer, assignment,
distribution or other disposition by the Company and/or one of its Subsidiaries, in one transaction, or in a series of related
transactions within any period of 18 consecutive calendar months (including, without limitation, by means of the sale, transfer,
assignment, distribution or other disposition of the capital stock of any Subsidiary or Subsidiaries), of assets which account
for an aggregate of 50% or more of the consolidated revenues of the Company and its Subsidiaries, as determined in accordance with
U.S. generally accepted accounting principles, for the fiscal year most recently ended prior to the date of such transaction (or,
in the case of a series of transactions as described above, the first such transaction); provided, however, that no such transaction
shall be taken into account if substantially all the proceeds thereof (whether in cash or in kind) are used after such transaction
in the ongoing conduct by the Company and/or its Subsidiaries of the business conducted by the Company and/or its Subsidiaries
prior to such transaction; or


 


(vii)notwithstanding Sections
2.6(i) through 2.6(vi) above, in the case of a distribution under the Plan of an amount which is subject to Section 409A of the
Code, an event which constitutes a “change in control event” as defined under Section 409A of the Code.


 


2.7.“Code” means the
Internal Revenue Code of 1986, as amended from time to time and the regulations and other guidance issued thereunder.


 


2.8.“Committee” means
the Compensation Committee of the Board. The Committee shall have at least two members, each of whom shall be a “non-employee
director” as defined in Rule 16b-3 under the Exchange Act and an “outside director” as defined in Section 162(m)
of the Code and the regulations thereunder, and, if applicable meet the independence requirements of the applicable stock exchange,
quotation system or other self-regulatory organization on which the Shares are traded.


 


2.9.“Company” means
Griffon Corporation, a Delaware corporation, or any successor corporation.


 


2.10.“Consultant”
means an individual who renders services to the Company or a Subsidiary as a consultant, advisor or independent contractor.


 


2.11.“Deferral Period”
means the period of time during which Deferred Shares are subject to deferral limitations under Section 9.


 


2.12.“Deferred Shares”
means an Award pursuant to Section 9 of the right to receive Shares at the end of a specified Deferral Period.


 


2.13.“Effective Date”
has the meaning provided in Section 22.


 


2.14.“Employee” means
any person, including an officer, employed by the Company or a Subsidiary.



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2.15.“Exchange Act”
means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and
rules thereto.


 


2.16.“Fair Market Value”
means, on any given date, unless otherwise determined by the Committee, the closing sale prices reported as having occurred on
the New York Stock Exchange (or other principal exchange or market on which the Shares are traded or listed) on such date, or,
if no sale was made on such date on such principal exchange or market, on the last preceding day on which the Shares were traded
or listed.


 


2.17.“Grant Date”
means the date specified by the Committee on which a grant of an Award shall become effective, which shall not be earlier than
the date on which the Committee takes action with respect thereto.


 


2.18.“Incentive Stock Option”
means any Option which meets the requirements of Section 422 of the Code and which is designated as an Incentive Stock Option by
the Committee in the Award Agreement, and if the Committee does not designate an Option as an Incentive Stock Option in the Award
Agreement, it shall not be treated as an incentive stock option hereunder.


 


2.19.“Non-employee Director”
means a member of the Board who is not an Employee.


 


2.20.“Nonqualified Stock Option”
means an Option that is not intended to qualify as an Incentive Stock Option.


 


2.21.“Option” means
any option to purchase Shares granted under Section 6.


 


2.22.“Optionee” means
the person so designated in an agreement evidencing an outstanding Option.


 


2.23.“Option Price”
means the purchase price per share payable upon the exercise of an Option.


 


2.24.“Other Stock-Based Award”
means an Award granted pursuant to Section 9A.


 


2.25.“Participant”
means an Employee, Non-employee Director or Consultant who is selected by the Committee to receive an Award, provided that only
Employees may receive grants of Incentive Stock Options.


 


2.26.“Performance Objectives”
means the performance objectives established in the sole discretion of the Committee for Participants who are eligible to receive
Awards under the Plan. Performance Objectives may be described in terms of Company-wide objectives or objectives that are related
to the performance of the individual Participant or the Subsidiary, division, department or function within the Company or Subsidiary
in which the Participant is employed. Performance Objectives may be measured on an absolute or relative basis. Relative performance
may be measured by a group of peer companies or by a financial market index. Any Performance Objectives applicable to a Qualified
Performance-Based Award shall be limited to: specified levels of or increases in the Company’s, a division’s or a Subsidiary’s
return on capital, equity or assets; earnings measures/ratios (on a gross, net, pre-tax or post-tax basis),



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including basic earnings per share, diluted
earnings per share, total earnings, operating earnings, earnings growth, earnings before interest and taxes and earnings before
interest, taxes, depreciation and amortization; net economic profit (which is operating earnings minus a charge to capital); net
income; operating income; sales; sales growth; gross margin; direct margin; Share price (including but not limited to growth measures
and total stockholder return); operating profit; per period or cumulative cash flow (including but not limited to operating cash
flow and free cash flow) or cash flow return on investment (which equals net cash flow divided by total capital); inventory turns;
financial return ratios; market share; balance sheet measurements such as receivable turnover; improvement in or attainment of
expense levels; improvement in or attainment of working capital levels; debt reduction; strategic innovation; customer or employee
satisfaction; the consummation of one or more acquisitions of a certain size as measured by one or more of the financial criteria
listed above in this Section 2.26; individual objectives; and any combination of the foregoing. If the Committee determines that
a change in the business, operations, corporate structure or capital structure of the Company, or the manner in which it conducts
its business, or other events or circumstances render the Performance Objectives unsuitable, the Committee may modify such Performance
Objectives or the related minimum acceptable level of achievement, in whole or in part, as the Committee deems appropriate and
equitable.


 


2.27.“Performance Period”
means a period of time established under Section 5 within which the Performance Objectives relating to Awards are to be achieved.


 


2.28.“Performance Share”
means a bookkeeping entry that records the equivalent of one Share awarded pursuant to Section 5.


 


2.29.“Performance Unit”
means a bookkeeping entry that records a unit equivalent to $1.00 awarded pursuant to Section 5.


 


2.30.“Qualified Performance-Based
Award” means an Award or portion of an Award that is intended to satisfy the requirements for “qualified performance-based
compensation” under Code Section 162(m). The Committee shall designate any Qualified Performance-Based Award as such at the
time of grant.


 


2.31.“Restricted Shares”
mean Shares granted under Section 8 subject to a substantial risk of forfeiture.


 


2.32.“Shares” means
shares of the Common Stock of the Company, $.25 par value, or any security into which Shares may be converted by reason of any
transaction or event of the type referred to in Section 14.


 


2.33.“Spread” means,
in the case of a Stock Appreciation Right, the amount by which the Fair Market Value on the date when any such right is exercised
exceeds the Base Price specified in such right.


 


2.34.“Stock Appreciation Right”
means a right granted under Section 7.


 


2.35.“Subsidiary”
means a corporation or other entity in which the Company owns or controls directly or indirectly at least 50 percent of the total
combined voting power represented



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by all classes of stock issued by such corporation,
or in the case of a noncorporate entity, at least 50% of the profits or capital interests in such entity, at the time of such grant.


 


3.Shares Available Under the Plan.


 


3.1.Reserved Shares. Subject to
adjustment as provided in Section 14, the maximum number of Shares that may be (a) issued upon the exercise or settlement of Options
or Stock Appreciation Rights, (b) issued as Restricted Shares and released from substantial risk of forfeiture, (c) issued in payment
of Deferred Shares or Performance Shares, or (d) issued in connection with Other Stock-Based Awards, shall not in the aggregate
exceed 3,000,000 Shares plus any shares underlying awards outstanding as of the Effective Date under the Griffon Corporation 2006
Equity Incentive Plan that are subsequently cancelled or forfeited. Such Shares may be Shares of original issuance, Shares held
in Treasury, or Shares that have been reacquired by the Company. In addition:


 


(i)To the extent any Shares
covered by an Award are not issued to a Participant (or, if applicable, his heir, legatee or permitted transferee) because the
Award is forfeited or canceled, such Shares shall not be deemed to have been issued for purposes of determining the maximum number
of Shares available for issuance under the Plan.


 


(ii)Shares issued under the
Plan in settlement, assumption or substitution of outstanding awards (or obligations to grant future awards) under the plans or
arrangements of another entity shall not reduce the maximum number of Shares available for issuance under the Plan, to the extent
that such settlement, assumption or substitution is a result of the Company acquiring another entity (or an interest in another
entity).


 


3.2.ISO Maximum. In no event shall
the number of Shares issued upon the exercise of Incentive Stock Options exceed 600,000 Shares, subject to adjustment as provided
in Section 14.


 


3.3.Maximum Annual Award. No Participant
may receive Awards (including performance-based Awards) in the aggregate in any one fiscal year, subject to adjustment as provided
in Section 14, representing more than: (i) 2,000,000 Shares underlying Options; and (ii) 1,000,000 Shares underlying Performance
Shares, Performance Units, Stock Appreciation Rights, Restricted Shares, Deferred Shares and Other Stock-Based Awards. Notwithstanding
the above, the maximum number of shares that may be granted to a Participant in any one Performance Period underlying Performance
Shares and Performance Units that are intended to be Qualified Performance-Based Awards is 1,000,000 Shares, subject to adjustment
as provided in Section 14.


 


4.Plan Administration.


 


4.1.Committee Administration.
This Plan shall be administered by the Committee. The interpretation and construction by the Committee of any provision of this
Plan or of any Award Agreement and any determination by the Committee pursuant to any provision of this Plan or any such agreement,
notification or document, shall be final and conclusive. No member of the Committee shall be liable to any person for any such
action taken or determination made, other than one made in bad faith.


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4.2.Committee Powers. The Committee
shall have full authority to interpret the Plan; to establish and amend rules and regulations relating to the Plan; to select the
Participants and determine the type of Awards to be made to Participants, the number of shares subject to Awards and the terms,
conditions, restrictions and limitations of Awards; and to make all other determinations as are necessary or advisable for the
administration of the Plan.


 


4.3.Committee Delegation. The
Committee may delegate to one or more officers of the Company the authority to grant Awards to Participants who are not subject
to the requirements of Section 16 of the Exchange Act or Section 162(m) of the Code and the rules and regulations thereunder, provided
that the Committee shall have fixed the total number of Shares subject to such grants. Any such delegation shall be subject to
the limitations of Section 157(c) of the Delaware General Corporation Law. The Committee may revoke any such allocation or delegation
at any time for any reason with or without prior notice.


 


5.Performance Shares and Performance
Units. The Committee may authorize grants of Performance Shares and Performance Units, which shall vest and become payable
to the Participant upon the achievement of specified Performance Objectives during a specified Performance Period, upon such terms
and conditions as the Committee may determine in accordance with the following provisions:


 


5.1.Terms and Conditions of Performance
Share/Performance Unit Awards. Each grant shall specify the number of Performance Shares or Performance Units to which it pertains.
The Performance Period with respect to each Performance Share or Performance Unit shall commence on the Grant Date and may be subject
to earlier termination in the event of a Change in Control or other similar transaction or event. Each grant shall specify the
Performance Objectives that are to be achieved by the Participant. Each grant may specify in respect of the specified Performance
Objectives a minimum acceptable level of achievement below which no payment shall be made and may set forth a formula for determining
the amount of any payment to be made if performance is at or above such minimum acceptable level but falls short of the maximum
achievement of the specified Performance Objectives.


 


5.2.Payment of Performance Shares
and Units. Each grant shall specify the time and manner of payment of Performance Shares or Performance Units that shall have
been earned, and shall be paid by the Company in Shares.


 


5.3.Maximum Payment. Subject to
Section 3.4 of the Plan, any grant of Performance Shares may specify that the number of Shares payable with respect thereto may
not exceed a maximum number of Shares specified by the Committee on the Grant Date.


 


5.4.Adjustment of Performance Objectives.
The Committee may adjust Performance Objectives and the related minimum acceptable level of achievement if, in the sole judgment
of the Committee, events or transactions have occurred after the Grant Date that are unrelated to the performance of the Participant
and result in distortion of the Performance Objectives or the related minimum acceptable level of achievement.


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5.5.Qualified Performance-Based Awards.
In the case of a Qualified Performance-Based Award the following provisions shall apply in addition to, and where necessary,
in lieu of other provisions of the Plan, including the provisions of Sections 5.1 through 5.4:


 


(i)Only Employees who are “Covered
Employees” within the meaning of Section 162(m) of the Code shall be eligible to receive Qualified Performance-Based Awards.
The Committee shall designate in its sole discretion which Covered Employees shall be Participants for a Performance Period within
the earlier of the (a) first 90 days of a Performance Period and (b) the lapse of 25% of the Performance Period.


 


(ii)The Committee shall establish
in writing within the earlier of the (a) first 90 days of a Performance Period and (b) the lapse of 25% of the Performance Period,
and in any event, while the outcome is substantially uncertain, (x) Performance Objectives for the Performance Period, and (y)
in respect of such Performance Objectives, a minimum acceptable level of achievement below which no Award shall be made, and an
objective formula or other method for determining the Award to be made if performance is at or above such minimum acceptable level
but falls short of the maximum achievement of the specified Performance Objectives.


 


(iii)Following the completion
of a Performance Period, the Committee shall review and certify in writing whether, and to what extent, the Performance Objectives
for the Performance Period have been achieved and, if so, calculate and certify in writing the amount of the Qualified Performance-Based
Awards earned for the period based upon the Performance Objectives and the related formulas or methods as determined pursuant to
Section 5.5(ii). The Committee shall then determine the actual number of Shares issuable under each Participant’s Award for
the Performance Period, and, in doing so, may reduce or eliminate the amount of the Award, as permitted in the Award Agreement.
In no event shall the Committee have the authority to increase Award amounts to any Covered Employee.


 


(iv)Subject to Section 20.2,
Awards granted for a Performance Period shall be made to Participants within a reasonable time after completion of the certification
described in Section 5.5(iii).


 


5.6.Other Awards. Any grant of
an Award under Sections 6, 7, 8, 9 or 9A and/or the vesting or exercise thereof, may be further conditioned upon the attainment
of Performance Objectives established by the Committee in accordance with the applicable provisions of this Section 5 regarding
Performance Shares and Performance Units.


 


6.Options. The Committee
may from time to time authorize grants of Options to Participants upon such terms and conditions as the Committee may determine
in accordance with the following provisions:


 


6.1.Number of Shares. Each grant
shall specify the number of Shares to which it pertains.


 


6.2.Option Price. Each grant shall
specify an Option Price per Share, which shall be equal to or greater than the Fair Market Value per Share on the Grant Date; provided
that in the




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case of any Incentive Stock Option granted
to a person who on any given date owns, either directly or indirectly (taking into account the attribution rules contained in Section
424(d) of the Code), stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company
or any Subsidiary, the Option Price shall not be less than 110% of the Fair Market Value of a Share on the date of grant.


 


6.3.Consideration. Each grant
shall specify the form of consideration to be paid in satisfaction of the Option Price and the manner of payment of such consideration,
which may include (i) cash in the form of currency or check or other cash equivalent, in each such case as is acceptable to the
Company, (ii) subject to approval by the Committee, nonforfeitable, unrestricted Shares owned by the Optionee, or shares underlying
the Option being exercised, (iii) any other legal consideration that the Committee may deem appropriate on such basis as the Committee
may determine in accordance with this Plan, or (iv) any combination of the foregoing.


 


6.4.Broker Assisted Exercise.
To the extent such program is permitted by the Company and permitted by applicable law, rule or regulations, the Option Price may
be satisfied from the proceeds of a sale through a bank or broker on the date of exercise of some or all of the Shares to which
the exercise relates pursuant to a broker assisted exercise program provided by such bank or broker.


 


6.5.Exercise Period. No Option
granted may be exercised more than ten years after the Grant Date; provided that in the case of any Incentive Stock Option granted
to a person who on any given date owns, either directly or indirectly (taking into account the attribution rules contained in Section
424(d) of the Code), stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company
or any Subsidiary, such Option may not be exercised more than five years after the Grant Date.


 


6.6.Disqualifying Dispositions of
ISOs. Each Participant awarded an Incentive Stock Option under the Plan shall notify the Company in writing immediately after
the date he or she makes a disqualifying disposition (as defined in Section 421(b) of the Code) of any Shares acquired pursuant
to the exercise of such Incentive Stock Option. The Company may, if determined by the Committee and in accordance with procedures
established by it, retain possession of any Shares 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, subject to complying with any instructions
from such Participant as to the sale of such Shares.


 


7.Stock Appreciation Rights.
The Committee may also authorize grants to Participants of Stock Appreciation Rights. A Stock Appreciation Right is the right of
the Participant to receive from the Company an amount, which, shall be determined by the Committee and shall be expressed as a
percentage (not exceeding 100 percent) of the Spread at the time of the exercise of such right. Any grant of Stock Appreciation
Rights shall be upon such terms and conditions as the Committee may determine in accordance with the following provisions:


 


7.1.Payment in Shares. Any amount
payable upon the exercise of a Stock Appreciation Right shall be paid by the Company in Shares. Any grant may specify that the 




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number of Shares payable upon the exercise
of a Stock Appreciation Right shall not exceed a maximum number of Shares specified by the Committee on the Grant Date.


 


7.2.Exercise Period. Any grant
may specify (a) a waiting period or periods before Stock Appreciation Rights shall become exercisable and (b) permissible dates
or periods on or during which Stock Appreciation Rights shall be exercisable; provided that no Stock Appreciation Right granted
may be exercised more than ten years after the Grant Date. A grant may specify that a Stock Appreciation Right may be exercised
only in the event of a Change in Control or other similar transaction or event.


 


7.3.Base Price. Each grant shall
specify in respect of each Stock Appreciation Right a Base Price per Share, which shall be equal to or greater than the Fair Market
Value of such Share on the Grant Date.


 


7.4.Deemed Exercise. The Committee
may provide that a Stock Appreciation Right shall be deemed to be exercised at the close of business on the scheduled expiration
date of such Stock Appreciation Right if at such time the Stock Appreciation Right by its terms remains exercisable and, if so
exercised, would result in a payment of Shares to the holder of such Stock Appreciation Right.


 


8.Restricted Shares. The
Committee may also authorize grants to Participants of Restricted Shares upon such terms and conditions as the Committee may determine
in accordance with the following provisions:


 


8.1.Transfer of Shares. Each grant
shall constitute an immediate transfer of the ownership of Shares to the Participant in consideration of the performance of services,
subject to the substantial risk of forfeiture and restrictions on transfer referred to in Section 10. Each grant may be made without
additional consideration from the Participant or in consideration of a payment by the Participant that is less than the Fair Market
Value of such Shares on the Grant Date.


 


8.2.Dividends. Unless otherwise
provided by the Committee in an Award Agreement, all dividends or other distributions paid on the Restricted Shares during the
period of such restrictions shall be subject to the same restrictions as the underlying Award.


 


9.Deferred Shares.
The Committee may authorize grants of Deferred Shares to Participants upon such terms and conditions as the Committee may
determine in accordance with the following provisions:


 


9.1.Deferred Transfer of Shares.
Each grant shall constitute the agreement by the Company to issue or transfer Shares to the Participant in the future in consideration
of the performance of services, subject to the fulfillment during the Deferral Period of such conditions as the Committee may specify.


 


9.2.Consideration. Each grant
may be made without additional consideration from the Participant or in consideration of a payment by the Participant that is
less than the Fair Market Value of such Shares on the Grant Date. 




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9A.Other Stock-Based Awards.
The Committee may authorize grants to Participants of Awards, other than those described in Sections 5 through 9, that are based
on, related to, or are in some form of, Shares (“Other Stock-Based Awards”). Such Other Stock-Based Awards shall be
in such form and have such conditions as the Committee shall determine from time to time, including, without limitation, to whom
such Other Stock-Based Awards shall be made, the number of Shares to be awarded thereunder (or underlying such Award), and whether
such Other Stock-Based Awards shall be settled in cash, Shares or a combination of cash and Shares.


 


10.Vesting.


 


10.1.In General. Each grant of
Options and Stock Appreciation Rights shall specify the period of continuous employment by the Company or any Subsidiary, or service
to the Company or any Subsidiary (and in the case of a Non-employee Director, service on the Board), of the Participant that is
necessary before such Options or Stock Appreciation Rights, or installments thereof, shall become exercisable. Each grant of Restricted
Shares shall specify the period during which such Restricted Shares shall be subject to a “substantial risk of forfeiture”
within the meaning of Code Section 83, and each grant of Deferred Shares shall specify the Deferral Period to which such Deferred
Shares shall be subject. Each grant of such Award may provide for the earlier exercise of rights, termination of a risk of forfeiture
or termination of a Deferral Period in the event of a Change in Control or similar transaction or event.


 


10.2.Restrictions on Transfer of Restricted
Shares. Each grant of Restricted Shares shall provide that, during the period for which a substantial risk of forfeiture is
to continue, the transferability of the Restricted Shares shall be prohibited or restricted in the manner and to the extent prescribed
by the Committee on the Grant Date. Such restrictions may include, without limitation, rights of repurchase or first refusal in
the Company or provisions subjecting the Restricted Shares to a continuing substantial risk of forfeiture in the hands of any transferee.


 


11.Dividends and Other Ownership
Rights.


 


11.1.Restricted Shares. Except
as otherwise determined by the Committee, an Award of Restricted Shares shall entitle the Participant to voting and other ownership
rights during the period for which a substantial risk of forfeiture is to continue. Notwithstanding the foregoing, except as otherwise
determined by the Committee at or after the time of grant of an Award, any dividends or other distributions paid on the Restricted
Shares during the period of such restrictions shall be subject to the same restrictions as the underlying Award.


 


11.2.Deferred Shares. Unless otherwise
determined by the Committee, during the Deferral Period, the Participant shall not have any right to transfer any rights under
an Award of Deferred Shares, shall not have any rights of ownership in the Deferred Shares and shall not have any right to vote
such Shares.


 


12.Transferability.


 


12.1.Transfer Restrictions. Except
as provided in Section 12.2, no Award granted shall be transferable by a Participant other than by will or the laws of descent
and distribution, and Options and Stock Appreciation Rights shall be exercisable during a Participant’s lifetime only by
the Participant or, in the event of the Participant’s legal incapacity, by his or her guardian or 




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legal representative acting in a fiduciary capacity on behalf of the Participant
under state law. Any attempt to transfer an Award in violation of this Plan shall render such Award null and void. 


12.2.Limited Transfer Rights.
The Committee may expressly provide in an Award Agreement (or an amendment to an Award Agreement) that a Participant may transfer
such Award (other than an Incentive Stock Option), in whole or in part, to a spouse or lineal descendant (a “Family Member”),
a trust for the exclusive benefit of Family Members, a partnership or other entity in which all the beneficial owners are Family
Members, or any other entity affiliated with the Participant that may be approved by the Committee. Subsequent transfers of Awards
shall be prohibited except in accordance with this Section 12.2. All terms and conditions of the Award, including without limitation
provisions relating to termination of the Participant’s employment or service with the Company or a Subsidiary, shall continue
to apply following a transfer made in accordance with this Section 12.2. In order for a transfer to be effective, a Participant
must agree in writing prior to the transfer on a form provided by the Company to pay any and all payroll and withholding taxes
due upon exercise of the transferred Option. In addition, prior to the exercise of a transferred Option by a transferee, arrangements
must be made by the Participant with the Company for the payment of all payroll and withholding taxes. Finally, the Company shall
be under no obligation to provide a transferee with any notice regarding the transferred Awards held by the transferee upon forfeiture
or any other circumstance.


 


12.3.Restrictions on Transfer.
Any Award granted may provide that all or any part of the Shares that are (a) to be issued or transferred by the Company upon the
exercise of Options or Stock Appreciation Rights, upon termination of the Deferral Period applicable to Deferred Shares or upon
payment under any grant of Performance Shares or Performance Units, or (b) no longer subject to the substantial risk of forfeiture
and restrictions on transfer referred to in Section 10, shall be subject to further restrictions upon transfer, including restrictions
relating to any minimum Share ownership requirements imposed by the Company with respect to a Participant.


 


13.Award Agreement. Each
grant under the Plan shall be evidenced by an Award Agreement, which shall describe the subject Award, state that the Award is
subject to all of the terms and conditions of this Plan and contain such other terms and provisions as the Committee may determine
consistent with this Plan.


 


14.Adjustments.
The Committee shall make or provide for appropriate adjustments in the (a) number of Shares covered by outstanding Options,
Stock Appreciation Rights, Deferred Shares, Restricted Shares, Performance Shares and Other Stock-Based Awards granted hereunder,
(b) prices per Share applicable to such Options and Stock Appreciation Rights, and (c) kind of Shares covered thereby (including
Shares of another issuer), as the Committee in its sole discretion may in good faith determine to be equitably required in order
to prevent dilution or enlargement of the rights of Participants that otherwise would result from (x) any stock dividend, stock
split, combination or exchange of Shares, recapitalization or other change in the capital structure of the Company, (y) any merger,
consolidation, spin-off, spin-out, split-off, split-up, reorganization, partial or complete liquidation or other distribution
of assets (other than a normal cash dividend), issuance of rights or warrants to purchase securities, or (z) any other corporate
transaction or event having an effect similar to any of the foregoing. Moreover, in the 




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event of any such transaction or event, the
Committee may provide in substitution for any or all outstanding Awards such alternative consideration as it may in good faith
determine to be equitable under the circumstances and may require in connection therewith the surrender of all Awards so replaced.
The Committee may also make or provide for such adjustments in each of the limitations specified in Section 3 as the Committee
in its sole discretion may in good faith determine to be appropriate in order to reflect any transaction or event described in
this Section 14. The Company shall give each Participant notice of an adjustment hereunder and, upon
notice, such adjustment shall be conclusive and binding for all purposes.


 


15.Fractional Shares. The
Company shall not be required to issue any fractional Shares pursuant to this Plan. The Committee may provide for the elimination
of fractions or for the settlement thereof in cash.


 


16.Withholding Taxes. The
Company shall be entitled to deduct from any payment under the Plan, regardless of the form of such payment, the amount of all
applicable income and employment taxes required by law to be withheld with respect to such payment or may require the Participant
to pay to it such tax prior to and as a condition of the making of such payment. In accordance with any applicable administrative
guidelines it establishes, the Committee may allow a Participant to pay the amount of taxes required by law to be withheld from
an Award by withholding from any payment of Shares due as a result of such Award, or by permitting the Participant to deliver to
the Company Shares having a Fair Market Value, as determined by the Committee, equal to the minimum amount of such required withholding
taxes.


 


17.Certain Terminations of Employment,
Hardship and Approved Leaves of Absence. In the event of termination of employment by reason of death, disability, normal
retirement, early retirement with the consent of the Committee, other termination of employment or a leave of absence that is approved
by the Committee, or in the event of hardship or other special circumstances that are approved by the Committee, of a Participant
who holds an Option or Stock Appreciation Right that is not immediately and fully exercisable, any Restricted Shares as to which
the substantial risk of forfeiture or the prohibition or restriction on transfer has not lapsed, any Deferred Shares as to which
the Deferral Period is not complete, any Performance Shares or Performance Units that have not been fully earned, any Shares that
are subject to any transfer restriction pursuant to Section 12.3, or any Other Stock-Based-Award that is subject to any similar
limitations or restrictions, the Committee may, in its sole discretion, take any action that it deems to be equitable under the
circumstances or in the best interests of the Company, including without limitation waiving or modifying any limitation or requirement
with respect to any Award and providing for post-termination exercise periods with respect to any Option or Stock Appreciation
Right; provided that in the case of any Award subject to Section 409A of the Code, the Committee shall not take any action pursuant
to this Section 17 unless such action is permissible under Section 409A of the Code and the regulations thereunder.


 


18.Termination for Cause. A
Participant who is terminated for Cause shall, unless otherwise determined by the Committee, immediately forfeit, effective as
of the date the Participant engages in such conduct, all unexercised, unearned, and/or unpaid Awards, including, but not by way
of limitation, Awards earned but not yet paid or exercised, all unpaid dividends and all interest, if any, accrued on the foregoing. 



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19.Foreign Participants.
In order to facilitate the making of any grant or combination of grants under this Plan, the Committee may provide for such special
terms for Awards to Participants who are foreign nationals, or who are employed by or perform services for the Company or any Subsidiary
outside of the United States of America, as the Committee may consider necessary or appropriate to accommodate differences in local
law, tax policy or custom. Moreover, the Committee may approve such supplements to, or amendments, restatements or alternative
versions of, this Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of this
Plan as in effect for any other purpose, provided that no such supplements, amendments, restatements or alternative versions shall
include any provisions that are inconsistent with the terms of this Plan, as then in effect, unless this Plan could have been amended
to eliminate such inconsistency without further approval by the stockholders of the Company.


 


20.Amendments and Other Matters.


 


20.1.Plan Amendments. This Plan
may be amended from time to time by the Board, but no such amendment shall: (a) increase any of the limitations specified in Section
3, other than to reflect an adjustment made in accordance with Section 14, (b) change the class of persons eligible to receive
grants of Awards or the types of Awards available under the Plan, or (c) increase the benefits to Participants under the Plan,
in any such case without the further approval of the stockholders of the Company. The Board shall also condition any amendment
on the approval of the stockholders of the Company if such approval is necessary with respect to the applicable listing or other
requirements of a national securities exchange or other applicable laws, policies or regulations, and the Board may condition any
amendment on the approval of the stockholders of the Company if such approval is deemed advisable to comply with such requirements.


 


20.2.Award Deferrals. An Award
Agreement may provide that payment of any Award, dividend, or any portion thereof, may be deferred by a Participant until such
time as the Committee may establish, provided that no Award of any Option or a Stock Appreciation Right shall be permitted to be
deferred and further provided that such deferral is made in accordance with the requirements of Section 409A of the Code. All such
deferrals shall be accomplished by the delivery of a written, irrevocable election by the Participant prior to the time established
by the Committee in accordance with the requirements of Section 409A of the Code for such purpose, on a form provided by the Company.
Deferred Awards may also be credited with interest, at such rates to be determined by the Committee.


 


20.3.Conditional Awards. To the
extent permitted under Section 409A of the Code, the Committee may condition the grant of any Award or combination of Awards on
the surrender or deferral by the Participant of his or her right to receive a cash bonus or other compensation otherwise payable
by the Company or any Subsidiary to the Participant.


 


20.4.Repricing Prohibited. No
Award may be repriced, replaced, regranted through cancellation, or modified, directly or indirectly, without the approval of the
stockholders of the Company, provided that nothing herein shall prevent the Committee from taking any action provided for in Section
14.



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20.5.Underwater Option Buyouts Prohibited.
Without the approval of the stockholders of the Company, the Company shall not cancel, or acquire in exchange for cash or other
property, any Underwater Option. An Option shall be deemed to be an “Underwater Option” on any given date if, and only
if, on such date, the Option Price in respect of such Option is greater than the Fair Market Value on such date; provided that
nothing herein shall prevent the Committee or the Board from taking any action provided for in Section 14 or 21.3. In no event
shall this Section 20.5 be construed to apply to “issuing or assuming a stock option in a transaction to which Section 424(a)
applies,” within the meaning of Section 424 of the Code.


 


20.6.Amendments to Awards. Subject
to the requirements of Section 20.4, the Committee may at any time unilaterally amend any unexercised, unearned, or unpaid Award,
including, but not by way of limitation, Awards earned but not yet paid, to the extent it deems appropriate (including for the
purposes of compliance with local laws and regulations or to avoid costly government filings); provided, however, that except to
the extent that the Committee determines that an amendment is necessary to avoid a penalty tax under Section 409A of the Code,
any such amendment which, in the opinion of the Committee, is materially adverse to the Participant shall require the Participant’s
consent.


 


20.7.No Employment Right. This
Plan shall not confer upon any Participant any right with respect to continuance of employment or other service with the Company
or any Subsidiary and shall not interfere in any way with any right that the Company or any Subsidiary would otherwise have to
terminate any Participant’s employment or other service at any time.


 


20.8.Compliance with Section 409A
of the Code. Notwithstanding any other provision of the Plan to the contrary, (a) to the extent that any payment of or in connection
with an Award constitutes a payment under a “non-qualified deferred compensation plan,” as defined in Section 409A
of the Code, such payment shall be made in compliance with Section 409A of the Code and (b) any adjustment of Shares or prices
per Share or substitution of Awards pursuant to Section 14 and any modification of Awards pursuant to Section 17 shall not cause
the affected Award to violate the requirements of Section 409A of the Code.


 


21.Change in Control. Except
as otherwise provided at the time of grant in an Award Agreement relating to a particular Award and subject to the requirements
of Section 14, if a Change in Control occurs, then:


 


21.1.If a Participant is terminated without
Cause following such Change in Control, the Participant’s Restricted Shares, Deferred Shares, Performance Shares, Performance
Units or Other Stock-Based Awards that were forfeitable shall, unless otherwise determined by the Committee prior to the occurrence
of the Change in Control, become nonforfeitable and, to the extent applicable, shall be converted into Shares.


 


21.2.If a Participant is terminated without
Cause following such Change in Control, the Participant’s unexercised Option or Stock Appreciation Right, whether or not
exercisable on the date of such Change in Control, shall thereupon be fully exercisable and may be exercised, in whole or in part.



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21.3.Notwithstanding Sections 21.1 and
21.2, in the event of a Change in Control, the Committee may in its discretion cancel any outstanding
Awards and (a) pay to the holders thereof, in cash or stock, or any combination thereof, the value of such Awards based upon the
price per share of Stock received or to be received by other stockholders of the Company in the event or (b) arrange for substitute
awards to be granted to the holders thereof, denominated in the equity of the acquirer or an affiliate thereof, provided such substitute
awards substantially preserve the value of the substituted Awards.


 


21.4.If a Change in Control occurs during
the term of one or more Performance Periods for which the Committee has granted performance-based Awards pursuant to the provisions
of Section 5, the term of each such Performance Period (hereinafter a “current Performance Period”) shall immediately
terminate upon the occurrence of such Change in Control. Upon a Change in Control, for each current Performance Period and each
completed Performance Period for which the Committee has not on or before such date made a determination as to whether and to what
degree the Performance Objectives for such period have been attained (hereinafter a “completed Performance Period”),
it shall be assumed that the Performance Objectives have been attained at a level of one hundred percent (100%) or the equivalent
thereof. A Participant in one or more current Performance Periods shall be considered to have earned and, therefore, be entitled
to receive, a prorated portion of the Award previously granted to him for each such current Performance Period. Such prorated portion
shall be determined by multiplying the number of Performance Shares or Performance Units (or other performance-based Awards), as
the case may be, granted to the Participant by a fraction, the numerator of which is the total number of days that have elapsed
since the beginning of the current Performance Period, and the denominator of which is the total number of days in such current
Performance Period. A Participant in one or more completed Performance Periods shall be considered to have earned and, therefore,
be entitled to receive all the Performance Shares or Performance Units (or other performance-based Awards), as the case may be,
previously granted to him during each such completed Performance Period.


 


21.5.Upon a Change in Control, any Awards
deferred by a Participant under Section 20.2, but for which he or she has not received payment as of such date, shall be paid after
the occurrence of the Change in Control but no later than the 90th day following such Change in Control.


 


21.6.Notwithstanding any provision of
this Section 21, in the case of any Award subject to Section 409A of the Code, such Award shall vest and be distributed only in
accordance with the terms of the applicable Award Agreement and the Committee shall only be permitted to use discretion to the
extent that such discretion would be permitted under Section 409A of the Code.


 


22.Effective Date. This
Plan shall become effective on the date it is approved by the stockholders of the Company (the “Effective Date”). All
Awards shall be governed in accordance with the terms and conditions of the Plan in effect on the date of their respective Award
Agreements.



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23.Termination. This Plan
shall terminate on the tenth anniversary of the earlier of the date on which the Plan was adopted or the Effective Date, and no
Award shall be granted after such date.


 


24.Savings Clause. This
Plan is intended to comply in all aspects with applicable laws and regulations. In case any one or more of the provisions of this
Plan shall be held invalid, illegal or unenforceable in any respect under applicable law and regulation, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and the invalid, illegal or
unenforceable provision shall be deemed null and void; however, to the extent permissible by law, any provision which could be
deemed null and void shall first be construed, interpreted or revised retroactively to permit this Plan to be construed in compliance
with all applicable laws so as to foster the intent of the Plan.


 


25.Arbitration of Disputes.
Any and all disputes arising out of or relating to the Plan or any Award Agreement (or breach thereof) shall be resolved exclusively
through binding arbitration in the State of New York in accordance with the rules of the American Arbitration Association then
in effect.


 


26.Regulatory Approvals and Listings.
Notwithstanding anything contained in this Plan to the contrary, the Company shall have no obligation to issue or deliver certificates
of Shares evidencing Awards or any other Award resulting in the payment of Shares prior to (i) the obtaining of any approval from
any governmental agency which the Company shall, in its sole discretion, determine to be necessary or advisable, (ii) the admission
of such Shares to listing on the stock exchange or market on which the Shares may be listed, and (iii) the completion of any registration
or other qualification of said Shares under any state or federal law or ruling of any governmental body which the Company shall,
in its sole discretion, determine to be necessary or advisable. The Committee may, from time to time, impose additional restrictions
upon an Award, including but not limited to, restrictions regarding tax withholdings and restrictions regarding the Participant’s
ability to exercise Awards under the Company’s broker-assisted stock option exercise program.


 


27.No Right, Title, or Interest
in Company Assets. No Participant shall have any rights as a stockholder of the Company as a result of participation in
the Plan until the date of issuance of a stock certificate in his or her name, and, in the case of Restricted Shares, such rights
are granted to the Participant under the Plan. To the extent any person acquires a right to receive payments from the Company under
the Plan, such rights shall be no greater than the rights of an unsecured creditor of the Company and the Participant shall not
have any rights in or against any specific assets of the Company. All of the Awards granted under the Plan shall be unfunded.


 


28.No Guarantee of Tax Consequences.
Notwithstanding any other provision of the Plan, no person connected with the Plan in any capacity, including, but not limited
to, the Company and its directors, officers, agents and employees, makes any representation, commitment, or guarantee that any
tax treatment, including, but not limited to, federal, state and local income, estate and gift tax treatment, shall be applicable
with respect to the tax treatment of any Award, any amounts deferred under the Plan, or paid to or for the benefit of a Participant
under the Plan, or that such tax treatment shall apply to or be available to a Participant on account of



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participation in the Plan, or that any of
the foregoing amounts shall not be subject to the 20% penalty tax and interest under Section 409A of the Code.


 


29.Governing Law. The validity,
construction and effect of this Plan and any Award hereunder shall be determined in accordance with the laws of the State of Delaware.



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