Exhibit
10.1


 


EPIQ SYSTEMS, INC.


1995 STOCK OPTION PLAN


AS AMENDED THROUGH JUNE 2, 2010


 


I. PURPOSE


 


The purposes of the EPIQ
Systems, Inc. 1995 Stock Option Plan (the “Plan”) are to: (1) closely
associate the interests of the directors, officers and all other employees of
EPIQ Systems, Inc. (the “Corporation”) with the interests of the
shareholders by reinforcing the relationship between participants’ rewards and
shareholder gains; (2) provide directors, officers and all other employees
with an equity ownership in the Corporation commensurate with corporate
performance, as reflected in increased shareholder value; (3) maintain
competitive compensation levels; and (4) provide an incentive to officers
and all other employees for continuous employment with the Corporation.


 


II. ADMINISTRATION


 


(a)           The Plan shall be
administered by the Board of Directors of the Corporation (the “Board”) or a
Stock Option Plan Committee (“Committee”) of the Board.  Unless the Committee is composed solely of
not less than two members of the Board who qualify as “Non-Employee Directors”
under Rule 16b-3 or its successors promulgated under the Securities
Exchange Act of 1934, as amended (“Rule 16b-3”), all grants of stock
options under the Plan to officers and directors of the Corporation shall be
made by the Board. (The administrator of the Plan shall be referred to herein
as the “Committee”, regardless of whether the Plan is administered by the Board
or the Committee).  In addition to its
duties with respect to the Plan stated elsewhere in the Plan, the Committee
shall have full authority, consistent with the Plan, to interpret the Plan, to
promulgate such rules and regulations with respect to the Plan as it deems
desirable, to delegate its ministerial responsibilities hereunder to appropriate
persons and to make all other determinations necessary or desirable for the
administration of the Plan.  All
decisions, determinations and interpretations of the Committee shall be binding
upon all persons.


 


(b)           Stock options
granted pursuant to the Plan (“Options”) shall be either incentive stock
options (“ISOs”) intended to qualify under Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”), or nonqualified stock options (“NSOs”)
not intended to qualify under Section 422 of the Code.  References in this Plan to Options shall
include both ISOs and NSOs.


 


(c)           The Committee
shall administer the Plan in a manner necessary to establish and maintain the
Options intended to constitute ISOs as ISOs, and the Options intended to constitute
NSOs as NSOs.  Accordingly, only
employees of the Corporation will be eligible for grants of ISOs.  However, the Corporation makes no
representation that the Options designated as ISOs and the Options designated
as NSOs will qualify at the time of grant as ISOs and NSOs, respectively, or
will continue to qualify as ISOs and NSOs respectively.  Nor does the Corporation make any
representation concerning the tax consequences to any person upon receipt or
exercise of any Option hereunder or the subsequent sale of Common Stock
acquired thereunder.


 


III. SHARES SUBJECT TO THE PLAN


 


Shares of common stock that may be issued
under the Plan shall be the common stock, one cent ($.01) par value, of the
Corporation (“Common Stock”).  The
aggregate number of shares of Common Stock, subject to adjustment pursuant to Article XVI,
which may be delivered on exercise of the Options is 4,500,000 and such amounts
of shares of Common Stock shall be, and hereby are reserved for such
purpose.  Such shares may be previously
issues shares reacquired by the Corporation or authorized but unissued
shares.  If any Option expires,
terminates or is canceled for any reason, without having been exercised in
full, the shares 


 


1

















 


covered by the unexercised portion of such Option shall again be
available for Options, within the limit specified above.


 


IV. PARTICIPANTS


 


All members of the Board and
all employees of the Corporation, or, if applicable, its subsidiaries,
including employees who are members of the Board, shall be eligible to
participate in the Plan; provided, however, that only employees of the
Corporation shall be granted ISOs. 
Subject to the foregoing, the Committee shall, from time to time,
determine, in its discretion, the directors and employees, who shall be
eligible for participation in the Plan (the “Participants”).  (For purposes of the Plan, the term “Participant(s)”
shall, when appropriate, include any person permitted to exercise an Option in
accordance with the terms of the Plan.) 
A member of the Board who is not an employee of the Corporation shall
not be eligible to receive ISOs.


 


V. GRANTS OF OPTIONS


 


(a)           The Committee
shall in its discretion determine the time or times when Options shall be
granted and the number of shares of Common Stock to be subject to each Option,
except that no Option may be granted more than ten years after the effective
date hereof.


 


(b)           The Committee may
in its discretion grant to Participants who are employees of the Corporation
either ISOs, NSOs or a combination of both and shall at the time the Option is
granted designate whether the Option is an ISO or NSO.


 


(c)           The Committee may
only grant NSOs to Participants who are not employees of the Corporation.


 


(d)           At any given
time, a share of Common Stock may be subject to only one of the two types of
Options that may be issued under the Plan.


 


(e)           With respect to
ISOs granted under the Plan, the aggregate fair market value (determined as of
the date the Option is granted) of the Common Stock with respect to which ISOs
are exercisable for the first time by the Participant during any calendar year
under all stock option plans of the Corporation and its subsidiaries shall not
exceed $100,000.  Notwithstanding the
provisions for acceleration of the date an Option is first exercisable in Article VII
and Article VIII, in no event shall the date that an ISO is first
exercisable be accelerated under this Plan if the acceleration would cause an
ISO of a Participant to exceed the limit set forth in this paragraph.


 


(f)            No Option
intended to constitute an ISO shall be granted to an employee who, at the time
the Option is granted, owns (within the meaning of Section 422(b)(6) of
the Code) Common Stock possessing more than 10 percent of the total combined
voting power of all classes of stock of the Corporation or, if applicable, any
of its subsidiaries (hereinafter referred to as a “Ten Percent Shareholder”)
unless (1) the purchase price of the Common Stock subject to such Option
shall be, subject to adjustment pursuant to Article XVI, at least 110
percent of the fair market value of the Common Stock on the day the Option is
granted determined in accordance with Article VI which relates to the
method for determining the fair market value of the Common Stock on the date
the ISO is granted, and (2) the Option by its terms is not exercisable
after the expiration of five years from the date such Option is granted.


 


(g)           Each Option shall
be evidenced by a written Option Agreement which shall (1) state the terms
and conditions of the Option in accordance with the Plan; and (2) contain
such additional provisions as may be required under applicable laws,
regulations, and rules or otherwise consistent with the terms of the Plan
as the Committee may determine.


 


2

















 


VI. OPTION PRICE


 


(a)           The purchase
price of a share of Common Stock subject to an NSO shall be, subject to
adjustment pursuant to Article XVI, an amount equal to the fair market
value of the Common Stock on the day the NSO is granted.


 


(b)           Except as
provided in paragraph (f) of Article V relating to ISOs issued to Ten
Percent Shareholders, the purchase price of a share of Common Stock subject to
an ISO shall be, subject to adjustment pursuant to Article XVI, an amount equal
to the fair market value of the Common Stock on the day the ISO is granted.


 


(c)           The fair market
value shall be the closing price at which the Common Stock is traded on the day
the NSO or ISO is granted. For this purpose, the closing price of the Common
Stock on any business day shall be (i) if such Common Stock is listed or
admitted for trading on any United States national securities exchange, or if
actual transactions are otherwise reported on a consolidated transaction
reporting system, the last reported sale price of Common Stock on such exchange
or reporting system, as reported in any newspaper of general circulation, (ii) if
the Common Stock is quoted on the National Association of Securities Dealers
Automated Quotations System (“NASDAQ”), or any similar system of automated
dissemination of quotations of securities prices in common use, the closing bid
quotation for such day of the Common Stock on such system, or (iii) if
neither clause (i) or (ii) is applicable, the mean between the high
bid and low ask quotations for the Common Stock as reported by the National
Quotation Bureau, Incorporated if at least two securities dealers have inserted
both bid and ask quotations for the Common Stock on at least 5 of the 10
preceding days.


 


(d)           Except for adjustments pursuant to Article XVI, the
purchase price for any outstanding NSO or ISO granted under the Plan may not be
decreased after the date of grant nor may an outstanding NSO or ISO granted
under the Plan be surrendered to the Company as consideration for the grant of
a new option with a lower exercise price.


 


VII. OPTION PERIOD; EXERCISE RIGHTS


 


(a)           Except as
provided in paragraph (f) of Article V relating to ISOs issued to Ten
Percent Shareholders, each Option shall be exercisable for a term as the Committee
shall determine, but not more than 10 years from the date it is granted, and
shall be subject to earlier termination as provided in Article VIII.


 


(b)           Unless
specifically provided by the Committee in its sole discretion, an Option shall
become exercisable upon its grant.


 


VIII. EXERCISE RIGHTS UPON TERMINATION OF EMPLOYMENT


 


(a)           If a Participant
terminates employment on account of becoming disabled, the Participant may
exercise the Option in whole or in part within one year after the date of
disability, but in no event later than the date on which it would have expired
if the Participant had not become disabled.


 


For this purpose, a
Participant shall be deemed to be disabled if he or she is determined to be
disabled for purposes of meeting any insurance requirements under policies
provided by the Corporation.  If no such
policies are in effect, disability shall have the same meaning as set forth in Section 22(e) of
the Code.


 


(b)           If a Participant
dies during a period in which he or she is entitled to exercise an Option
(including the periods referred to in paragraphs (a) and (d) of this
Article), the Option may be exercised at any time within its remaining term as
shall be prescribed in the Option Agreement, but in no event later than the
date on which it would have expired if the Participant had lived, or one year
after the Participant’s death, whichever date is earlier, by the Participant’s
executor or administrator or by any person or persons who shall


 


3

















 


have acquired the Option directly from the
Participant by will or the laws of descent and distribution.  The Option may be exercised in whole or in
part.


 


(c)           If a Participant’s
employment with the Corporation or a subsidiary shall be terminated for cause,
he or she shall forfeit any and all outstanding Option rights and such rights
shall be deemed to have lapsed for purposes hereof as of the date of the
Participant’s termination of service.


 


(d)           If a Participant
ceases to be employed by the Corporation or a subsidiary for any reason other
than disability, death or termination for cause during a period in which he or
she is entitled to exercise an Option, the Participant’s Option shall terminate
three months after the date of such cessation of employment, but in no event
later than the date on which it would have expired if such cessation of
employment had not occurred.  During such
period the Option may be exercised only to the extent that the Participant was
entitled to do so at the date of cessation of employment.  The employment of a Participant shall not be
deemed to have ceased upon his or her absence from the Corporation or a
subsidiary on a leave of absence granted in accordance with the usual
procedures of the Corporation or such subsidiary.


 


(e)           No acceleration
of the exercise date of an ISO shall occur pursuant to this Article if
such earlier exercise would cause an ISO to violate paragraph (e) of Article V.


 


IX. METHOD OF EXERCISE


 


An Option shall be deemed
exercised when (i) the Corporation has received written notice of such
exercise in accordance with the terms of the Option, (ii) full payment of
the aggregate exercise price of the shares of Common Stock as to which the
Option is exercised has been made, and (iii) arrangements that are satisfactory
to the Committee in its sole discretion have been made for the Participant’s
payment to the Corporation of the amount that is necessary for the Corporation
to withhold taxes in accordance with applicable Federal, state or local tax
withholding requirements.  The exercise
price of any share of Common Stock purchased, and any required tax payment,
shall be paid in cash, by the tender of mature shares of Common Stock, or
both.  If payment is made in cash, it may
be made by certified or official bank check, personal check or money order. If
payment is made by the tender of mature shares of Common Stock, the fair market
value of each such share shall be determined as of the day the shares are
tendered for payment, in a manner consistent with the determination of fair
market value under paragraph (c) of Article VI.  Any excess of the value of the tendered
shares over the purchase price will be returned to the Participant as follows:


 


(i)            Any
whole shares remaining in excess of the purchase price will be returned to the
Participant in kind, and may be represented by one or more certificates as
determined by the Corporation in its sole discretion.


 


(ii)           Any
partial Shares remaining in excess of the purchase price will be returned to
the Participant in cash.


 


No Participant shall be deemed to be a holder
of any shares of Common Stock subject to an Option unless and until a stock
certificate or certificates for such shares are issued to such person(s) under
the terms of the Plan.  No adjustment
shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights for which the
record date is prior to the date such stock certificate is issued, except as
expressly provided in Article XVI.


 


For purposes of this Article IX, “mature
shares” shall mean those shares of Common Stock held by Participant for at
least six (6) months, with the measurement of the beginning of such six (6) month
period commencing with those shares owned by Participant.


 


4

















 


X. WITHHOLDING TAXES


 


Whenever the Corporation
proposes or is required to issue or transfer shares of Common Stock under the
Plan, the Corporation shall have the right to require the Participant to remit
to the Corporation an amount sufficient to satisfy any Federal, state and/or
local withholding tax requirements prior to the delivery of any certificate or
certificates for such shares. 
Alternatively, the Corporation may issue or transfer such shares of
Common Stock net of the number of shares sufficient to satisfy the withholding
tax requirements.  For withholding tax
purposes, the shares of Common Stock shall be valued on the date the
withholding obligation is incurred.


 


XI. NONTRANSFERABILITY OF OPTIONS


 


Each Option shall be
nonassignable and nontransferable by the Participant other than by will or the
laws of descent and distribution.  Each
Option shall be exercisable during the Participant’s lifetime only by the
Participant.


 


XII. REPURCHASE OF SHARES BY CORPORATION


 


The Corporation is under no
obligation to repurchase Common Stock acquired pursuant to the exercise of an
Option hereunder.


 


XIII. USE OF PROCEEDS


 


The proceeds received by the
Corporation from the sale by it of shares of Common Stock to Participants exercising
Options pursuant to the Plan will be used for the general purposes of the
Corporation.


 


XIV. LAWS AND REGULATIONS


 


(a)           If any provision
of the Plan should be held invalid or illegal for any reason, such
determination shall not affect the remaining provisions hereof, but instead the
Plan shall be construed and enforced as if such provision had never been
included in the Plan.  Without limiting
the generality of the foregoing, transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3.  To the extent any provision of the Plan or
action by the Committee hereunder is inconsistent with the foregoing
requirements, it shall be deemed null and void.


 


(b)           The
determinations and the interpretation and construction of any provision of the
Plan by the Committee shall be final and conclusive.  This Plan shall be governed by the laws of
the State of Missouri.  Headings
contained in this Plan are for convenience only and shall in no manner be
construed as part of this Plan.  Any
reference to the masculine, feminine, or neuter gender shall be a reference to
such other gender as is appropriate.


 


XV. ISSUANCE OF SHARES OF COMMON STOCK


 


As a condition of any sale
or issuance of shares of Common Stock upon exercise of any Option, the
Committee may require such agreements or undertakings, if any, as the Committee
may deem necessary or advisable to assure compliance with any applicable law or
regulation include, but not limited to, the following:


 


(a)           a
representation and warranty by the Participant to the Corporation, at the time
any Option is exercised, that the Participant is acquiring the shares of Common
Stock to be issued for investment and not with a view to, or for sale in
connection with, the distribution of any such shares; and


 


5

















 


(b)           a
representation, warranty and/or agreement to be bound by any legends that are,
in the opinion of the Committee, necessary or appropriate to comply with the
provisions of any securities law deemed by the Committee to be applicable to
the issuance of the shares of Common Stock and are endorsed upon the share
certificates.


 


XVI. ADJUSTMENT UPON CHANGES IN CAPITALIZATION


 


(a)           In the event of a
reorganization, recapitalization, stock split, stock dividend, combination of
shares, merger, consolidation, distribution of assets, or any other change in
the corporate structure or shares of the Company, the Committee, as necessary
to prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan, shall appropriately and equitably make
such adjustment in the number and kind of Shares available for issuance under
this Plan (including, without limitation, the total number of Shares available
for issuance under this Plan pursuant to Section III), the number and kind
of options, and the exercise price of outstanding options; provided, in each
case, that with respect to grants of ISOs intended to qualify as ISOs after
such adjustment, no such adjustment shall be authorized to the extent such
adjustment would cause the Incentive Stock Option to violate Section 424(a) of
the Code.  Any such adjustment shall be
final, conclusive and binding for all purposes of this Plan.


 


(b)           Except as
otherwise expressly provided herein, the issuance by the Corporation of shares
of its capital stock of any class, or securities convertible into shares of
capital stock of any class, either in connection with a direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Corporation convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or exercise price of the shares of Common Stock then
subject to outstanding Options granted under the Plan.


 


(c)           Without limiting
the generality of the foregoing, the existence of outstanding Options granted
under the Plan shall not affect in any manner the right or power to the
Corporation to make, authorize or consummate (i) any or all adjustments,
recapitalizations, reorganizations or other changes in the Corporation’s
capital structure or its business; (ii) any merger or consolidation of the
Corporation; (iii) any issue by the Corporation of debt securities, or
preferred or preference stock that would rank above the shares of Common Stock
subject to outstanding Options; (iv) the dissolution or liquidation of the
Corporation; (v) any sale, transfer or assignment of all or any part of
the assets or business of the Corporation; or (vi) any other corporate act
or proceedings, whether of a similar character or otherwise.


 


XVII. NO EMPLOYMENT RIGHTS


 


Nothing in the Plan shall
confer upon any employee of the Corporation or of a subsidiary, if applicable,
any right to continued employment, or interfere with the right of the
Corporation or a subsidiary to terminate his or her employment at any time, for
any reason.


 


XVIII. TERM OF PLAN; TERMINATION; AMENDMENTS


 


(a)           This Plan is
effective as of October 17, 1995 (the “Effective Date”), the date of its
original adoption by the unanimous consent of the Board and the unanimous
consent of the Shareholders of the Corporation. 
This Plan shall continue in effect until all Options granted hereunder
have expired or been exercised, unless sooner terminated under the provisions
relating thereto.  No Option shall be
granted after 10 years from the Effective Date.


 


(b)           The Board may
from time to time amend, terminate or suspend the Plan or an Option, provided,
however that, except to the extent provided in Article XVI, no such
amendment may (i) without approval by the Corporation’s shareholders,
increase the number of shares of Common Stock reserved for Options or change
the class of persons eligible to receive Options or involve any other change or
modification requiring shareholder approval under Rule 16b-3, (ii) permit
the granting of Options that expire beyond the


 


6

















 


maximum period described in Article V, (iii) extend
the termination date of the Plan as set forth in Article V, (iv) cause
the Plan to be ineligible to issue ISOs, (v) without approval by the
Corporation’s shareholders, amend any outstanding NSO or ISO in a manner that
would be deemed to be a repricing under the rules of the New York Stock
Exchange or NASDAQ, (vi) without approval by the Corporation’s
shareholders, amend Article VI, (vii) without approval by the
Corporation’s shareholders, materially increase in any other way the benefits
accruing to Participants or (viii) except to the extent otherwise
specifically provided in the Plan, substantially impair any Option previously
granted to a Participant without the consent of such Participant.  Any termination or suspension of the Plan
shall not affect Options already granted and such Options shall remain in full
force and effect as if this Plan had not been terminated or suspended.  No Option may be granted while the Plan is
suspended or after it is terminated.


 


(c)           Except as set
forth herein, the Board or the Committee, as the case may be, may at any time
or times amend the Plan, or amend any outstanding Option or Options for the
purpose of satisfying the requirements of any changes in applicable laws or
regulations or for any other purpose which at the time may be permitted by
law.  In the event that applicable rules or
regulations are promulgated by the Internal Revenue Service which permit the
acceleration of the date an Option is first exercisable without violating the
$100,000 limit described in paragraph (e) of Article V, the Committee
is authorized to act on behalf of the Board in amending the Plan to permit
acceleration in conformity with such rules or regulations.


 


(d)           Nothing contained
in this Plan shall be construed to prevent the Corporation or any subsidiary,
if applicable, from taking any corporate action which is deemed by the
Corporation or any such subsidiary to be appropriate or in its best interest,
whether or not such action would have an adverse effect on the Plan or any
award made under the Plan.  No employee,
beneficiary, other person shall have any claim against the Corporation or any
subsidiary as a result of any such action.


 


XIX. INDEMNIFICATION OF COMMITTEE AND BOARD


 


The Corporation may,
consistent with applicable law, indemnify members of the Committee against any
liability, loss or other financial consequence suffered by them with respect to
any act or omission of the Committee or its members relating to the Plan to the
same extent and subject to the same conditions as specified in the indemnity
provisions contained in the By-Laws of the Corporation.


 


XX. INTERPRETATION


 


(a)           If any provision
of the Plan should be held invalid or illegal for any reason, such
determination shall not affect the remaining provisions hereof, but instead the
Plan shall be construed and enforced as if such provision had never been
included in the Plan.  Without limiting
the generality of the foregoing, transactions under this Plan are intended to
comply with all applicable conditions of Rule 16b-3 or its successors promulgated
under the Securities Exchange Act of 1934 and, in the case of ISOs, with all
applicable conditions of Section 422 of the Code or its successors and
regulations promulgated thereunder.  To
the extent any provision of the Plan or action by the Committee or Board
hereunder is inconsistent with the foregoing requirements, it shall be deemed
null and void.


 


(b)           The
determinations and the interpretation and construction of any provision of the
Plan by the Committee shall be final and conclusive.


 


7