Exhibit 10.1





Exhibit 10.1




ABM INDUSTRIES INCORPORATED

STATEMENT OF TERMS AND CONDITIONS APPLICABLE TO

OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS

AND PERFORMANCE SHARES GRANTED TO EMPLOYEES

PURSUANT TO THE 2006 EQUITY INCENTIVE PLAN

(As Amended and Restated March 31, 2010)





	I.	 	INTRODUCTION





The following terms and conditions shall apply to each Award granted under the Plan to an Employee
eligible to participate in the Plan, except as may otherwise be determined by the Administrator, as
provided herein. This Statement of Terms and Conditions is subject to the terms of the Plan and of
any Award made pursuant to the Plan. In the event of any inconsistency between this Statement of
Terms and Conditions and the Plan, the Plan shall govern.




	II.	 	DEFINITIONS





Capitalized terms not otherwise defined in this Statement of Terms and Conditions shall have the
meaning set forth in the Plan. When capitalized in this Statement of Terms and Conditions, the
following additional terms shall have the meaning set forth below:




	A.	 	“Cause” means, with respect to a Participant:
	 
	 	 	(i) serious misconduct, dishonesty, disloyalty or insubordination;
	 
	 	 	(ii) the Participant’s conviction (or entry of a plea bargain admitting criminal guilt) of
any felony or misdemeanor involving moral turpitude;
	 
	 	 	(iii) drug or alcohol abuse that has a material or potentially material effect on the
Company’s reputation and/or the performance of the Participant’s duties and
responsibilities under the Participant’s employment agreement;
	 
	 	 	(iv) failure to substantially perform the Participant’s duties or responsibilities under
the Participant’s employment agreement for reasons other than death or disability;
	 
	 	 	(v) repeated inattention to duty for reasons other than death or disability; or
	 
	 	 	(vi) any other material breach of the Participant’s employment agreement by the
Participant.
	 
	B.	 	“Competitive Activity” shall mean, with respect to a Participant, the Participant’s
participation, without the written consent signed by an officer of the Company and authorized
by the Board, in the management of any business enterprise if (i) such enterprise engages in
substantial and direct competition with the Company and such enterprise’s sales of any product
or service competitive with any product or service of the Company amounted to 10% of such
enterprise’s net sales for its most recently completed fiscal year and if the Company’s net
sales of said product or service amounted to 10% of the Company’s net sales for its most
recently completed fiscal year or (ii) the primary business done or intended to be done by
such enterprise is in direct competition with the business of providing facility services in
any geographic market in which the Company operates. “Competitive Activity” will not include
the mere ownership of securities in any such enterprise and the exercise of rights appurtenant
thereto, if such ownership is less than 5% of the outstanding voting securities or units of
such enterprise.




 


 









 











	C.	 	“Excess Equity Award” means the positive difference, if any, between the value of the
Award granted to an Executive Officer and the Award that would have been made to such
Executive Officer had the amount of the Award been calculated based on the Company’s financial
statements as restated.
	 
	D.	 	“Executive Officer” means any person who is an officer of the Company for purposes of
Section 16 of the Exchange Act.
	 
	E.	 	“Fair Market Value” of a Share as of a specified date means the closing price at
which Shares are traded on such date as reported in the New York Stock Exchange composite
transactions published in the Wall Street Journal, or if no trading of Shares is reported for
that day, on the next following day on which trading is reported; provided
that for purposes of determining the exercise price of an Incentive Stock Option, the
Fair Market Value of a Share as of the date of grant means the average of the opening and
closing price at which Shares are traded on such date as reported in the New York Stock
Exchange composite transactions published in the Wall Street Journal, or if no trading of
Shares is reported for that day, on the next preceding day on which trading was reported.
	 
	F.	 	“Grant Date” means the date the Administrator grants the Award.
	 
	G.	 	“Independent Committee” means any committee consisting of independent
Directors designated by the independent members of the Board.
H. “Option Period” means the period commencing on the Grant Date of an
Option and, except as otherwise provided in Section III.E, ending on
the Termination Date.
I. “Option Proceeds” means, with respect to any sale or other disposition
of Shares issued or issuable upon the exercise of an Option, an amount
determined appropriate by the independent members of the Board or the
Independent Committee, in its sole judgment, to reflect the effect of
a restatement of the Company’s financial statements on the Company’s
stock price, up to an amount equal to the number of Shares sold or
disposed of, multiplied by a number equal to the difference between
the Fair Market Value per Share at the time of sale or disposition and
the Exercise Price.
	 
	J.	 	“Termination Date” means the date that an Option expires as set forth in the Option
Agreement.






	III.	 	OPTIONS






	A.	 	Option Notice and Agreement. An Option granted under the Plan shall be evidenced by
an Option Agreement setting forth the terms and conditions of the Option, including whether
the Option is an Incentive Stock Option or a Nonqualified Stock Option and the number of
Shares subject to the Option. Each Option Agreement shall incorporate by reference and be
subject to this Statement of Terms and Conditions and the terms and conditions of the Plan,
except as may otherwise be determined by the Administrator.
	 
	B.	 	Exercise Price. The Exercise Price of an Option, as specified in the Option
Agreement, shall be equal to or greater than the Fair Market Value of the Shares underlying
the Option on the Grant Date.
	 
	C.	 	Option Period. An Option shall be exercisable only during the applicable Option
Period, and during such Option Period the exercisability of the Option shall be subject to the
vesting provisions of Section III.D as modified by the rules set forth in Sections III.E, V
and VI. The Option Period shall be not more than seven years from the Grant Date.




 


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	D.	 	Vesting of Right to Exercise Options.






	 	1.	 	Except as provided in the last sentence of this Section III.D.1 and in
Sections V, VI and VII, an Option shall be exercisable during the Option Period in
accordance with the following vesting schedule: (i) 25% of the Shares subject to the
Option shall vest on the first anniversary of the Grant Date; (ii) an additional 25%
of the Shares shall vest on the second anniversary of the Grant Date; (iii) an
additional 25% of the Shares shall vest on the third anniversary of the Grant Date;
and (iv) the remaining 25% of the Shares subject to the Option shall vest on the
fourth anniversary of the Grant Date. Notwithstanding the foregoing, the
Administrator may specify a different vesting schedule.
	 
	 	2.	 	Any vested portion of an Option not exercised hereunder shall accumulate
and be exercisable at any time on or before the Termination Date, subject to the
rules set forth in Sections III.E, V, VI and VII. No Option may be exercised for less
than 5% of the total number of Shares then available for exercise under such Option.
In no event shall the Company be required to issue fractional shares.






	E.	 	Termination of Employment. In addition to the terms set forth in the Plan with
respect to termination of employment:






	 	1.	 	Except as provided in the last sentence of this Section III.E.1, if a
Participant ceases to be a bona fide employee of the Company or an Affiliate due to
his or her Retirement, Disability or death during the Option Period, in addition to
any Shares vested under the Option Agreement prior to the date of Disability or
death, the Option shall vest in the number of Shares equal to 25% of the number of
Shares originally subject to the Option, multiplied by the number of whole months
between the most recent anniversary date of the Option grant and the date of
Retirement, Disability or death, and divided by 12. Notwithstanding the foregoing,
the Administrator may specify a different provision regarding vesting upon
termination of employment due to Retirement, Disability or death, or any other
reason.
	 
	 	2.	 	If a Participant who ceases to be a bona fide employee of the Company or an
Affiliate is subsequently rehired prior to the expiration of his or her Option, then
the Option shall continue to remain outstanding until such time as the Participant
subsequently terminates employment or the Option otherwise terminates pursuant to
this Statement of Terms and Conditions. Upon the Participant’s subsequent termination
of employment, the post-termination exercise period calculated pursuant to the terms
and conditions of this Section III.E shall be reduced by the number of days between
the date of the Participant’s initial termination of employment and his or her rehire
date; provided, however, that if the rehired Participant continues to be employed by
the Company or an Affiliate for at least one year from his or her rehire date, then
the post-termination exercise period for the Option shall be determined in accordance
with the Plan and shall not be adjusted as described above.






	F.	 	Method of Exercise. A Participant may exercise an Option with respect to all or any
part of the exercisable Shares as follows:






	 	1.	 	By giving the Company, or its authorized representative designated for this
purpose, written notice of such exercise specifying the number of Shares as to which
the Option is so exercised. Such notice shall be accompanied by an amount equal to
the Exercise Price of such Shares, in the form of any one or combination of the
following:




 


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	 	a.	 	cash or certified check, bank draft, postal or express
money order payable to the order of the Company in lawful money of the
United States;
	 
	 	b.	 	if approved by the Company at the time of exercise,
personal check of the Participant;
	 
	 	c.	 	if approved by the Company at the time of exercise, a
“net exercise” pursuant to which the Company will not require a payment of
the exercise price from the Participant but will reduce the number of Shares
issued upon the exercise by the largest number of whole Shares that has a
Fair Market Value that does not exceed the aggregate exercise price. With
respect to any remaining balance of the aggregate exercise price, the
Company shall accept payment in a form identified in (a) or (b) of this
section;
	 
	 	d.	 	if approved by the Company at the time of exercise, by
tendering to the Company or its authorized representative Shares which have
been owned by the Participant for at least six months prior to said tender,
and having a Fair Market Value, as determined by the Company, equal to the
Exercise Price. In the event a Participant tenders Shares to pay the
Exercise Price, tender of Shares acquired through exercise of an Incentive
Stock Option may result in unfavorable income tax consequences unless such
Shares are held for at least two years from the Grant Date of the Incentive
Stock Option and one year from the date of exercise of the Incentive Stock
Option;
	 
	 	e.	 	if approved by the Company at the time of exercise,
delivery (including by FAX transmission) to the Company or its authorized
representative of an executed irrevocable option exercise form together with
irrevocable instructions to an approved registered investment broker to sell
Shares in an amount sufficient to pay the Exercise Price plus any applicable
withholding taxes and to transfer the proceeds of such sale to the Company;
and






	 	2.	 	If required by the Company, by giving satisfactory assurance in writing,
signed by the Participant, the Participant shall give his or her assurance that the
Shares subject to the Option are being purchased for investment and not with a view
to the distribution thereof; provided that such assurance shall be deemed
inapplicable to (i) any sale of the Shares by such Participant made in accordance
with the terms of a registration statement covering such sale, which has heretofore
been (or may hereafter be) filed and become effective under the Securities Act of
1933, as amended (the “Securities Act”) and with respect to which no stop order
suspending the effectiveness thereof has been issued, and (ii) any other sale of the
Shares with respect to which, in the opinion of counsel for the Company, such
assurance is not required to be given in order to comply with the provisions of the
Securities Act.






	G.	 	Limitations on Transfer. An Option shall, during a Participant’s lifetime, be
exercisable only by the Participant. No Option or any right granted thereunder shall be
transferable by the Participant by operation of law or otherwise, other than as set forth in
the Plan. In the event of any attempt by a Participant to alienate, assign, pledge,
hypothecate, or otherwise dispose of an Option or of any right thereunder, except as provided
herein, or in the event of the levy of any attachment, execution, or similar process upon the
rights or interest hereby conferred, the Company at its election may terminate the affected
Option by notice to the Participant and the Option shall thereupon become null and void.




 


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	H.	 	No Shareholder Rights. Neither a Participant nor any person entitled to exercise a
Participant’s rights in the event of the Participant’s death shall have any of the rights of a
shareholder with respect to the Shares subject to an Option except to the extent that an
Option has been exercised.






	IV.	 	RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND PERFORMANCE SHARES






	A.	 	Agreement. A Restricted Stock Award, Restricted Stock Unit Award, or Performance
Share Award granted under the Plan shall be evidenced by an Agreement to be executed by the
Participant and the Company setting forth the terms and conditions of the Award. Each Award
Agreement shall incorporate by reference and be subject to this Statement of Terms and
Conditions and the terms and conditions of the Plan, except as may otherwise be determined by
the Administrator.
	 
	B.	 	Special Restrictions. Each Restricted Stock Award, Restricted Stock Unit Award, or
Performance Share Award made under the Plan shall contain the following terms, conditions and
restrictions, except as may otherwise be determined by the Administrator.






	 	1.	 	Restrictions. Until the restrictions imposed on any Restricted
Stock Award shall lapse, shares of Restricted Stock granted to a Participant: (a)
shall not be sold, assigned, transferred, pledged, hypothecated, or otherwise
disposed of, and (b) shall, if the Participant experiences a “separation from
service” (within the meaning of Section 409A of the Code) from the Company or an
Affiliate for any reason (except as otherwise provided in the Plan or in Section
IV.B.2) be returned to the Company forthwith, and all the rights of the Participant
to such Shares shall immediately terminate. A Participant shall not be permitted to
sell, transfer, pledge, assign or encumber such Restricted Stock Units or Performance
Shares, other than pursuant to a qualified domestic relations order as defined in the
Code or Title I of the Employee Retirement Income Security Act. If a Participant
experiences a “separation from service” (within the meaning of Section 409A of the
Code) from the Company or an Affiliate (except as otherwise provided in the Plan or
in Section IV.B.2) prior to the lapse of the restrictions imposed on a Restricted
Stock Unit Award or Performance Share Award, the unvested portion of the Restricted
Stock Unit Award or Performance Share Award shall be forfeited to the Company, and
all the rights of the Participant to such Award shall immediately terminate. If a
Participant is absent from work with the Company or an Affiliate because of his or
her short-term disability or because the Participant is on an approved leave of
absence, if the period of such leave does not exceed six months (or if longer, so
long as the individual retains a right to reemployment with the Company under an
applicable statute or by contract), the Participant shall not be deemed during the
period of any such absence, by virtue of such absence alone, to have experienced a
“separation from service” (within the meaning of Section 409A of the Code) from the
Company or an Affiliate except as the Administrator may otherwise expressly
determine. Notwithstanding the foregoing, if the Participant is on a voluntary leave
of absence for the purpose of serving the government of the country of which the
Participant is a citizen or in which the Participant’s principal place of employment
is located, such leave shall be considered an approved leave of absence.
	 
	 	2.	 	Termination of Employment by Reason of Retirement, Disability or
Death.






	 	a.	 	Restricted Stock Awards and Restricted Stock Unit
Awards. Notwithstanding any provision contained in the Plan to the
contrary, and except as provided in the last sentence of this Section
IV.B.2.a, if a




 


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	 	 	 	Participant who has been in the continuous employment of the Company or
an Affiliate since the Grant Date of a Restricted Stock Award or
Restricted Stock Unit Award ceases to be a bona fide employee of the
Company or an Affiliate, which cessation constitutes a “separation from
service” under Section 409A of the Code and which is a result of
Retirement, Disability or death, then the restrictions shall lapse as to
the number of Shares or Share Equivalents equal to: (i) 50% of the
number of Shares or Share Equivalents originally subject to the Award,
multiplied by (ii) the number of whole months between the Grant Date (or
if the Grant Date occurred more than two years prior to the date of
Retirement, Disability or death, the second anniversary of the Grant
Date) and the date of Retirement, Disability or death, divided by (iii)
24. Notwithstanding the foregoing, the Administrator may specify a
different provision regarding vesting upon termination of employment due
to Retirement, Disability or death, or any other reason.
	 
	 	b.	 	Performance Share Awards. Notwithstanding any
provision contained in the Plan to the contrary, and except as provided in
the last sentence of this Section IV.B.2.b, if a Participant who has been in
the continuous employment of the Company or an Affiliate since the Grant
Date of a Performance Share Award ceases to be a bona fide employee of the
Company or an Affiliate as a result of Retirement, Disability or death, then
at the end of the performance period the restrictions shall lapse as to the
number of Share Equivalents equal to: (i) the number of Performance Shares
vested in accordance with the performance objectives established by the
Administrator for the Award, multiplied by (ii) the number of whole months
between the Grant Date and the date of Retirement, Disability or death,
divided by (iii) the number of months in the performance period.
Notwithstanding the foregoing, the Administrator may specify a different
provision regarding vesting upon termination of employment due to
Retirement, Disability or death, or any other reason.






	C.	 	Dividends, Dividend Equivalents, and Business Transactions. Upon cash dividends being
paid on outstanding shares of ABM common stock, dividends shall be paid with respect to
Restricted Stock during the Restriction Period and shall be converted to additional shares of
Restricted Stock, which shall be subject to the same restrictions as the original Award for
the duration of the Restricted Period. Upon cash dividends being paid on outstanding shares of
ABM common stock, dividend equivalents shall be credited in respect of Restricted Stock Units
and Performance Shares, which shall be converted into additional Restricted Stock Units or
Performance Shares, which will be subject to all of the terms and conditions of the underlying
Restricted Stock Unit Award or Performance Share Award, including the same vesting
restrictions as the underlying Award. Upon stock dividends being paid on outstanding shares of
ABM common stock or a Business Transaction, the Administrator is authorized to take such
actions and make such changes with respect to outstanding Awards, including the performance
criteria for the termination of restrictions on Awards, as are consistent with the Plan and
this Statement of Terms and Conditions to effect the terms of the Awards.
	 
	D.	 	Election to Recognize Gross Income in the Year of Grant. If any Participant validly
elects within thirty days of the Grant Date to include in gross income for federal income tax
purposes an amount equal to the Fair Market Value of the Shares of Restricted Stock granted on
the Grant Date, such Participant shall pay to the Company, or make arrangements satisfactory
to the Administrator to pay to the Company in the year of such grant, any federal, state or
local taxes required to be withheld with respect to such shares in accordance with Section
VIII.F.




 


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	E.	 	No Shareholder Rights for Restricted Stock Units or Performance Shares. Neither a
Participant nor any person entitled to exercise a Participant’s rights in the event of the
Participant’s death shall have any of the rights of a shareholder with respect to the Share
Equivalents subject to a Restricted Stock Unit Award or Performance Share Award except to the
extent that a stock certificate has been issued with respect to such Shares upon the payment
of any vested Restricted Stock Unit Award or Performance Share Award.
	 
	F.	 	Time of Payment of Restricted Stock Units and Performance Shares.






	 	1.	 	Subject to Section IV.F.2 below, upon the lapse of the restriction imposed
on Restricted Stock Unit Awards or Performance Share Awards, all Restricted Stock
Units and Performance Shares that were not forfeited pursuant to Sections IV.B.1, V
or VI shall be paid to the Participant as soon as reasonably practicable after the
restrictions lapse but not later than 75 days following the date on which the
restrictions lapse. Payment shall be made in Shares in the form of a stock
certificate. The foregoing notwithstanding, the Participant may elect to defer
payment of the Restricted Stock Units in the manner described in Section IV.G.
	 
	 	2.	 	To the extent required in order to avoid accelerated taxation and/or tax
penalties under Code Section 409A, amounts that would otherwise be payable pursuant
to Section IV.F of this Statement of Terms and Conditions during the six-month period
immediately following a Participant’s termination of employment shall instead be paid
on the first business day after the date that is six months following the
Participant’s termination of employment (or upon the Participant’s death, if
earlier).






	G.	 	Deferral Election. Each Participant, pursuant to rules established by the
Administrator, may be entitled to elect to defer all or a percentage of any payment in respect
of a Restricted Stock Unit Award or Performance Shares that he or she may be entitled to
receive as determined pursuant to Section IV.F. This election shall be made by giving notice
in a manner and within the time prescribed by the Administrator and in compliance with Code
Section 409A. Each Participant must indicate the percentage (expressed in whole percentages)
he or she chooses to defer of any payment he or she may be entitled to receive. If no notice
is given, the Participant shall be deemed to have made no deferral election. Each deferral
election filed with the Company shall become irrevocable in accordance with the terms and
conditions of the Company’s Deferred Compensation Plan (or any successor plan) and in
compliance with Code Section 409A.






	V.	 	SPECIAL FORFEITURE AND REPAYMENT RULES IN THE EVENT OF CONDUCT CONSTITUTING CAUSE





Any other provision of this Statement of Terms and Conditions to the contrary notwithstanding, if
the independent members of the Board or the Independent Committee determines that a Participant has
engaged in conduct which constitutes Cause, the following provisions shall apply:




	A.	 	Any outstanding Option shall immediately and automatically terminate, be forfeited and shall
cease to be exercisable, without limitation. In addition, any shares of Restricted Stock,
Restricted Stock Units or Performance Shares as to which the restrictions have not lapsed
shall immediately and automatically be forfeited, all of the rights of the Participant to such
 shares or share equivalents shall immediately terminate, and any Restricted Stock shall be
returned to the Company.




 


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	B.	 	The lapse of restrictions on or vesting of Restricted Stock, Restricted Stock Units, or
Performance Shares that have vested or upon which the restrictions have lapsed within the
36-month period immediately prior to the date it is determined that the Participant
engaged in conduct constituting Cause (the “Determination Date”) shall be rescinded and
all outstanding Awards shall be cancelled. The Participant shall deliver to the Company
the Shares delivered upon vesting or lapse of restrictions if such vesting or lapse of
restrictions has been rescinded and the Shares retained by the Participant.
	 
	C.	 	The independent members of the Board or the Independent Committee may, to the extent
permitted by applicable law, rescind any Awards made to the Participant within the 36-month
period immediately prior to the Determination Date.
	 
	D.	 	The independent members of the Board or the Independent Committee may, to the extent
permitted by applicable law, recover any gains realized from the sale of vested Shares or the
sale or other disposition of any Shares issued or issuable upon the exercise of an Option, in
the case of any such sale or other disposition during the 36-month period immediately prior to
the Determination Date.





The independent members of the Board or the Independent Committee shall determine in such body’s
sole discretion whether the Participant has engaged in conduct that constitutes Cause.



Any provision of this Section V which is determined by a court of competent jurisdiction to be
invalid or unenforceable should be construed or limited in a manner that is valid and enforceable
and that comes closest to the business objectives intended by such invalid or unenforceable
provision, without invalidating or rendering unenforceable the remaining provisions of this Section
V.




	VI.	 	RECOUPMENT IN THE EVENT OF A RESTATEMENT





Any other provision of this Statement of Terms and Conditions to the contrary notwithstanding, if
the Company’s financial statements are the subject of a restatement due to misconduct, fraud or
malfeasance, then the following shall apply:




	A.	 	To the extent permitted by governing law, the independent members of the Board or the
Independent Committee may, in its discretion, (1) rescind any Excess Equity Award or portion
thereof made to an Executive Officer within the 36-month period immediately prior to the date
such material restatement is first publicly disclosed and (2) in the event that an Executive
Officer has sold or otherwise disposed of some or all of the Shares subject to the Excess
Equity Award, recover any gains made from the sale or other disposition of such Shares that
was effected during the 36-month period immediately prior to the date such material
restatement is first publicly disclosed. In no event shall the Company be required to award an
Executive Officer additional equity incentive compensation should the restated financial
statements result in a higher equity incentive payment.
	 
	B.	 	In addition to the foregoing, the independent members of the Board or the Independent
Committee may, in its discretion, require that an Executive Officer pay the Company, in cash
and upon demand, Option Proceeds resulting from the sale or other disposition of Shares issued
or issuable upon the exercise of an Option if the sale or disposition was effected during the
36-month period immediately prior to the date such material restatement is first publicly
disclosed.





Any provision of this Section VI which is determined by a court of competent jurisdiction to be
invalid or unenforceable should be construed or limited in a manner that is valid and enforceable
and that comes closest to the business objectives intended by such invalid or unenforceable
provision, without invalidating or rendering unenforceable the remaining provisions of this Section
VI.


 


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	VII.	 	CHANGE IN CONTROL






	A.	 	Effect of Change in Control on Options. Subject to the limitations set forth in
Section VII.C, in the event of a Change in Control, the surviving, continuing, successor, or
purchasing Company or other business entity or parent thereof, as the case may be (the
“Acquiror”) may, without the consent of any Participant, either assume or continue the
Company’s rights and obligations under outstanding Options or substitute for outstanding
Options substantially equivalent options covering the Acquiror’s stock. All Options assumed
or continued by the Acquiror in connection with a Change in Control will become fully vested
and exercisable if the Participant’s employment is terminated without Cause at any time during
the 12-month period following the Change in Control.
	 
	 	 	Any Option granted one year or more prior to the Change in Control that is neither assumed
nor continued by the Acquiror in connection with the Change in Control shall, contingent
on the Change in Control, become fully vested and exercisable immediately prior to the
Change in Control. Any Option granted less than one year prior to the Change in Control
that is neither assumed nor continued by the Acquiror in connection with the Change in
Control shall, to the extent not previously vested and exercisable, immediately prior to
the Change in Control become vested and exercisable as to the number of Shares subject to
such Option equal to (i) the number of Shares originally subject to such Option,
multiplied by (ii) the number of whole months between the Grant Date and the Change in
Control, divided by (iii) the number of months between the Grant Date and the date on
which all Shares originally subject to such Option would have been fully vested and
exercisable; and such Option shall terminate with respect to all remaining Shares subject
to such Option.
	 
	B.	 	Effect of Change in Control on Awards Other than Options. Subject to the limitations
set forth in Section VII.C, in the event of a Change in Control, the Acquiror may, without the
consent of any Participant, either assume or continue the Company’s rights and obligations
under outstanding Awards other than Options or substitute for such Awards substantially
equivalent awards covering the Acquiror’s stock. All Awards other than Options assumed or
continued by the Acquiror in connection with a Change in Control will become fully vested and
all restrictions on such Awards will lapse if the Participant’s employment is terminated
without Cause at any time during the 12-month period following the Change in Control. Any
Award that is neither assumed nor continued by the Acquiror in connection with the Change in
Control shall, upon the Change in Control, become fully vested and all restrictions shall be
released immediately prior to the Change in Control, and all Restricted Unit Awards and
Performance Share Awards shall become immediately payable. Notwithstanding anything in this
Section VII.B to the contrary, if the Change in Control does not constitute a “change in
effective ownership or control” of the Company within the meaning of Code Section 409A, the
Restricted Stock Units and Performance Shares granted pursuant to this Statement of Terms and
Conditions will vest as provided in this Section VII.B, but will be payable to the Participant
in accordance with the provisions of Section IV.
	 
	C.	 	Excess Parachute Payments. Subject to a Severance Agreement between the Participant
and the Company approved by the Board of Directors or the Compensation Committee, if any
amount or benefit to be paid or provided under an Award or any other agreement between a
Participant and the Company would be an Excess Parachute Payment but for the application of
this sentence, then the payments and benefits to be paid or provided under the Award and any
other agreement will be reduced to the minimum extent necessary (but in no event to less than
zero) so that no portion of any such payment or benefit, as so reduced, constitutes an Excess
Parachute Payment. The determination of whether any reduction in such payments or benefits to
be provided under the Award or any other agreement or otherwise is required pursuant to the
preceding sentence will be made at the expense of the Company by independent accountants or
the Company’s




 


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	 	 	benefits consultant. The fact that the
Participant’s right to payments or
benefits may be reduced by reason of
the limitations contained in this
paragraph will not of itself limit or
otherwise affect any other rights of
the Participant under any other
agreement. In the event that any
payment or benefit intended to be
provided is required to be reduced
pursuant to this paragraph, the
Participant will be entitled to
designate the payments and/or benefits
to be so reduced in order to give
effect to this paragraph. The Company
will provide the Participant with all
information reasonably requested by
the Participant to permit the
Participant to make such designation.
In the event that the Participant
fails to make such designation within
10 business days after receiving
notice from the Company of a reduction
under this paragraph, the Company may
effect such reduction in any manner it
deems appropriate.






	VIII.	 	MISCELLANEOUS






	A.	 	No Effect on Terms of Employment. Subject to the terms of any employment contract
entered into by the Company and a Participant to the contrary, the Company (or an Affiliate
which employs him or her) shall have the right to terminate or change the terms of employment
of a Participant at any time and for any reason whatsoever.
	 
	B.	 	Grants to Participants in Foreign Countries. In making grants to Participants in
foreign countries, the Administrator has the full discretion to deviate from this Statement of
Terms and Conditions in order to adjust Awards under the Plan to prevailing local conditions,
including custom and legal and tax requirements.
	 
	C.	 	Information Notification. Any information required to be given under the terms of an
Award Agreement shall be addressed to the Company in writing by mail, overnight delivery
service, or by electronic transmission to the Senior Vice President, Human Resources and the
Assistant Vice President & Director of Compensation. Any notice to be given to a Participant
shall be given in writing by mail, overnight delivery service, or by electronic transmission.
	 
	D.	 	Administrator Decisions Conclusive. All decisions of the Administrator administering
the Plan upon any questions arising under the Plan, under this Statement of Terms and
Conditions, or under an Award Agreement, shall be conclusive.
	 
	E.	 	No Effect on Other Benefit Plans. Nothing herein contained shall affect a
Participant’s right to participate in and receive benefits from and in accordance with the
then current provisions of any pensions, insurance or other employment welfare plan or program
offered by the Company.
	 
	F.	 	Withholding. Each Participant shall agree to make appropriate arrangements with the
Company and his or her employer for satisfaction of any applicable federal, state or local
income tax withholding requirements or payroll tax requirements. If approved by the Company at
the time of exercise, such arrangements may include an election by a Participant to have the
Company retain some portion of the Stock acquired pursuant to exercise of an Option to satisfy
such withholding requirements. The election must be made prior to the date on which the amount
to be withheld is determined. If a qualifying election is made, then upon exercise of an
Option, in whole or in part, the Company will retain the number of Shares having a value equal
to the amount necessary to satisfy any withholding requirements. Calculation of the number of
Shares to be withheld shall be made based on the Fair Market Value of the Stock. In no event,
however, shall the Company be required to issue fractional shares of Stock. The Administrator
shall be authorized to establish such rules, forms and procedures as it deems necessary to
implement the foregoing.




 


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With respect to the vesting of an Award other than an Option, if the Participant does not make an
arrangement with the Company and his or her employer for satisfaction of the applicable income and
withholding requirements or social security requirements in advance of the vesting date, the
Company shall retain the number of Shares (that otherwise would have been payable to the
Participant) having a value equal to the amount necessary to satisfy any withholding requirements.
Calculation of the number of such Shares shall be as described above.




	G.	 	Successors. This Statement of Terms and Conditions and the Award Agreements shall be
binding upon and inure to the benefit of any successor or successors of the Company.
“Participant” as used herein shall include the Participant’s Beneficiary.
	 
	H.	 	Governing Law. The interpretation, performance, and enforcement of this Statement of
Terms and Conditions and all Award Agreements shall be governed by the laws of the State of
Delaware.






 


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