exv10w13






Exhibit 10.13




THE CHEFS’ WAREHOUSE, INC.

2011 OMNIBUS EQUITY INCENTIVE PLAN




 









 





TABLE OF CONTENTS




	 	 	 	 	 	 	 

	Section 1.	 	Purpose
	 	 	1	 
	Section 2.	 	Definitions
	 	 	1	 
	Section 3.	 	Administration
	 	 	4	 
	Section 4.	 	Shares Available For Awards
	 	 	5	 
	Section 5.	 	Eligibility
	 	 	6	 
	Section 6.	 	Stock Options And Stock Appreciation Rights
	 	 	6	 
	Section 7.	 	Restricted Shares And Restricted Share Units
	 	 	8	 
	Section 8.	 	Performance Awards
	 	 	10	 
	Section 9.	 	Other Stock-Based Awards
	 	 	10	 
	Section 10.	 	Non-Employee Director And Outside Director Awards
	 	 	10	 
	Section 11.	 	Provisions Applicable To Covered Officers And Performance Awards
	 	 	11	 
	Section 12.	 	Separation From Service
	 	 	12	 
	Section 13.	 	Change In Control
	 	 	12	 
	Section 14.	 	Amendment And Termination
	 	 	14	 
	Section 15.	 	General Provisions
	 	 	14	 
	Section 16.	 	Term Of The Plan
	 	 	17	 






 









 





THE CHEFS’ WAREHOUSE, INC.

2011 OMNIBUS EQUITY INCENTIVE PLAN




Section 1. Purpose.




     This plan shall be known as the “The Chefs’ Warehouse, Inc. 2011 Omnibus Equity Incentive
Plan” (the “Plan”). The purpose of the Plan is to promote the interests of The Chefs’ Warehouse,
Inc. (the “Company”) and its stockholders by (i) attracting and retaining key officers, employees
and directors of, and consultants to, the Company and its Subsidiaries and Affiliates; (ii)
motivating such individuals by means of performance-related incentives to achieve long-range
performance goals; (iii) enabling such individuals to participate in the long-term growth and
financial success of the Company; (iv) encouraging ownership of stock in the Company by such
individuals; and (v) linking their compensation to the long-term interests of the Company and its
stockholders. With respect to any awards granted under the Plan that are intended to comply with
the requirements of “performance-based compensation” under Section 162(m) of the Code, the Plan
shall be interpreted in a manner consistent with such requirements.



Section 2. Definitions.




     As used in the Plan, the following terms shall have the meanings set forth below:



     2.1 “Affiliate” means (i) any entity that, directly or indirectly, is controlled by the
Company, (ii) any entity in which the Company has a significant equity interest, and (iii) an
affiliate of the Company, as defined in Rule 12b-2 promulgated under Section 12 of the Exchange
Act.



     2.2 “Award” means any Option, Stock Appreciation Right, Restricted Share Award, Restricted
Share Unit, Performance Award, or Other Stock-Based Award granted under the Plan, whether singly,
in combination or in tandem, to a Participant by the Committee (or the Board) pursuant to such
terms, conditions, restrictions and/or limitations, if any, as the Committee (or the Board) may
establish.



     2.3 “Award Agreement” means any written agreement, contract or other instrument or document
evidencing any Award, which may, but need not, be executed or acknowledged by a Participant.



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



     2.5 “Cause” means, unless otherwise defined in the applicable Award Agreement, (i) the
engaging by the Participant in willful misconduct that is injurious to the Company or its
Subsidiaries or Affiliates, or (ii) the embezzlement or misappropriation of funds or property of
the Company or its Subsidiaries or Affiliates by the Participant. For purposes of this paragraph,
no act, or failure to act, on the Participant’s part shall be considered “willful” unless done, or
omitted to be done, by the Participant not in good faith and without reasonable belief that the
Participant’s action or omission was in the best interest of the Company. Any determination of
Cause for purposes of the Plan or any Award shall be made by the Committee in its sole discretion.
Any such determination shall be final and binding on a Participant.



     2.6 “Change in Control” means, unless otherwise provided in the applicable Award Agreement,
the happening of one of the following:




     (a) any person or entity, including a “group” as defined in Section 13(d)(3) of the
Exchange Act, other than the Company or a wholly-owned Subsidiary thereof or any employee
benefit plan of the Company or any of its Subsidiaries, becomes the beneficial owner of the
Company’s securities having 35% or more of the combined voting power of the then outstanding
securities of the Company that may be cast for the election of directors of the Company
(other than as a result of an issuance of securities initiated by the Company in the
ordinary course of business); or




     (b) as the result of, or in connection with, any cash tender or exchange offer, merger
or other business combination, sale of assets or contested election, or any combination of
the foregoing transactions, less than a majority of the combined voting power of the then
outstanding securities of the Company or any



 









 







successor corporation or entity entitled to vote generally in the election of the directors of the Company or
such other corporation or entity after such transaction are held in the aggregate by
the holders of the Company’s securities entitled to vote generally in the election of
directors of the Company immediately prior to such transaction; or




     (c) during any period of two consecutive years, individuals who at the beginning of any
such period constitute the Board cease for any reason to constitute at least a majority
thereof, unless the election, or the nomination for election by the Company’s stockholders,
of each director of the Company first elected during such period was approved by a vote of
at least two-thirds of the directors of the Company then still in office who were directors
of the Company at the beginning of any such period.



     Notwithstanding the foregoing, unless otherwise provided in the applicable Award Agreement,
with respect to Awards subject to Section 409A of the Code, a Change in Control shall mean a
“change in the ownership of the Company,” a “change in the effective control of the Company,” or a
“change in the ownership of a substantial portion of the assets of the Company” as such terms are
defined in Section 1.409A-3(i)(5) of the Treasury Regulations.



     2.7 “Code” means the Internal Revenue Code of 1986, as amended from time to time.



     2.8 “Committee” means a committee of the Board composed of not less than two Non-Employee
Directors, each of whom shall be (i) a “non-employee director” for purposes of Exchange Act Section
16 and Rule 16b-3 thereunder, (ii) an “outside director” for purposes of Section 162(m), and (iii)
“independent” within the meaning of the listing standards of the Nasdaq Stock Market.



     2.9 “Consultant” means any consultant to the Company or its Subsidiaries or Affiliates.



     2.10 “Covered Officer” means at any date (i) any individual who, with respect to the previous
taxable year of the Company, was a “covered employee” of the Company within the meaning of Section
162(m); provided, however, that the term “Covered Officer” shall not include any such individual
who is designated by the Committee, in its discretion, at the time of any Award or at any
subsequent time, as reasonably expected not to be such a “covered employee” with respect to the
current taxable year of the Company or the taxable year of the Company in which the applicable
Award will be paid or vested, and (ii) any individual who is designated by the Committee, in its
discretion, at the time of any Award or at any subsequent time, as reasonably expected to be such a
“covered employee” with respect to the current taxable year of the Company or with respect to the
taxable year of the Company in which any applicable Award will be paid or vested.



     2.11 “Director” means a member of the Board.



     2.12 “Disability” means, unless otherwise defined in the applicable Award Agreement, a
disability that would qualify as a total and permanent disability under the Company’s then current
long-term disability plan. With respect to Awards subject to Section 409A of the Code, unless
otherwise defined in the applicable Award Agreement, the term “Disability” shall have the meaning
set forth in Section 409A of the Code.



     2.13 “Early Retirement” means, unless otherwise provided in an Award Agreement, retirement
with the express consent of the Committee at or before the time of such retirement, from active
employment with the Company and any Subsidiary or Affiliate prior to age 65, in accordance with any
applicable early retirement policy of the Company then in effect or as may be approved by the
Committee.



     2.14 “Effective Date” has the meaning provided in Section 16.1 of the Plan.



     2.15 “Employee” means a current or prospective officer or employee of the Company or of any
Subsidiary or Affiliate.



     2.16 “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.



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     2.17 “Fair Market Value” with respect to the Shares, means, for purposes of a grant of an
Award as of any date, (i) the reported closing sales price of the Shares on the Nasdaq Stock
Market, or any other such market or
exchange as is the principal trading market for the Shares, on such date, or in the absence of
reported sales on such date, the closing sales price on the immediately preceding date on which
sales were reported or (ii) in the event there is no public market for the Shares on such date, the
fair market value as determined, in good faith and by the reasonable application of a reasonable
valuation method (as applicable), by the Committee in its sole discretion, and for purposes of a
sale of a Share as of any date, the actual sales price on that date.



     2.18 “Good Reason” means, unless otherwise provided in an Award Agreement, (i) a material
reduction in a Participant’s position, authority, duties or responsibilities following a Change in
Control as compared to such level immediately prior to a Change in Control, (ii) any material
reduction in a Participant’s annual base salary as in effect immediately prior to a Change in
Control; (iii) the relocation of the office at which the Participant is to perform the majority of
his or her duties following a Change in Control to a location more than 30 miles from the location
at which the Participant performed such duties prior to the Change in Control; or (iv) the failure
by the Company or its successor to continue to provide the Participant with benefits substantially
similar in aggregate value to those enjoyed by the Participant under any of the Company’s pension,
life insurance, medical, health and accident or disability plans in which Participant was
participating immediately prior to a Change in Control, unless the Participant is offered
participation in other comparable benefit plans generally available to similarly situated employees
of the Company or its successor after the Change in Control.



     2.19 “Grant Price” means the price established at the time of grant of an SAR pursuant to
Section 6 used to determine whether there is any payment due upon exercise of the SAR.



     2.20 “Incentive Stock Option” means an option to purchase Shares from the Company that is
granted under Section 6 of the Plan and that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto.



     2.21 “Non-Employee Director” means a member of the Board who is not an officer or employee of
the Company or any Subsidiary or Affiliate.



     2.22 “Non-Qualified Stock Option” means an option to purchase Shares from the Company that is
granted under Sections 6 or 10 of the Plan and is not intended to be an Incentive
Stock Option.



     2.23 “Normal Retirement” means, unless otherwise defined in the applicable Award Agreement,
retirement of a Participant from active employment with the Company or any of its Subsidiaries or
Affiliates on or after such Participant’s 65th birthday.



     2.24 “Option” means an Incentive Stock Option or a Non-Qualified Stock Option.



     2.25 “Option Price” means the purchase price payable to purchase one Share upon the exercise
of an Option.



     2.26 “Other Stock-Based Award” means any Award granted under Sections 9 or 10
of the Plan. For purposes of the share counting provisions of Section 4.1 hereof, an Other
Stock-Based Award that is not settled in cash shall be treated as (i) an Option Award if the
amounts payable thereunder will be determined by reference to the appreciation of a Share, and (ii)
a Restricted Share Award if the amounts payable thereunder will be determined by reference to the
full value of a Share.



     2.27 “Outside Director” means, with respect to the grant of an Award, a member of the Board
then serving on the Committee.



     2.28 “Participant” means any Employee, Director, Consultant or other person who receives an
Award under the Plan.



     2.29 “Performance Award” means any Award granted under Section 8 of the Plan. For
purposes of the share counting provisions of Section 4.1 hereof, a Performance Award that
is not settled in cash shall be treated



3









 







as (i) an Option Award if the amounts payable thereunder
will be determined by reference to the appreciation of a
Share, and (ii) a Restricted Share Award if the amounts payable thereunder will be determined
by reference to the full value of a Share.



     2.30 “Person” means any individual, corporation, partnership, limited liability company,
association, joint-stock company, trust, unincorporated organization, government or political
subdivision thereof or other entity.



     2.31
“Registration Date” means the time that the
registration statement on Form S-1 of Chefs’ Warehouse Holdings, LLC,
predecessor to the Company, becomes effective.



     2.32 “Restricted Share” means any Share granted under Sections 7 to 10 of the Plan.



     2.33 “Restricted Share Unit” means any unit granted under Sections 7 to 10 of the Plan.



     2.34 “Retirement” means Normal or Early Retirement.



     2.35 “SEC” means the Securities and Exchange Commission or any successor thereto.



     2.36 “Section 16” means Section 16 of the Exchange Act and the rules promulgated thereunder
and any successor provision thereto as in effect from time to time.



     2.37 “Section 162(m)” means Section 162(m) of the Code and the regulations promulgated
thereunder and any successor provision thereto as in effect from time to time.



     2.38 “Separation from Service” or “Separates from Service” shall have the meaning ascribed to
such term pursuant to Section 409A of the Code and the regulations promulgated thereunder.



     2.39 “Shares” means shares of the common stock, no par value per share, of the Company.



     2.40 “Share Reserve” has the meaning set forth in Section 4.1 hereof.



     2.41 “Specified Employee” has the meaning ascribed to such term pursuant to Section 409A of
the Code and the regulations promulgated thereunder.



     2.42 “Stock Appreciation Right” or “SAR” means a stock appreciation right granted under
Sections 6, 8 or 10 of the Plan that entitles the holder to receive, with
respect to each Share encompassed by the exercise of such SAR, the amount determined by the
Committee and specified in an Award Agreement. In the absence of such a determination, the holder
shall be entitled to receive, with respect to each Share encompassed by the exercise of such SAR,
the excess of the Fair Market Value of such Share on the date of exercise over the Grant Price.



     2.43 “Subsidiary” means any Person (other than the Company) of which 50% or more of its voting
power or its equity securities or equity interest is owned directly or indirectly by the Company.



     2.44 “Substitute Awards” means Awards granted solely in assumption of, or in substitution for,
outstanding awards previously granted by a company acquired by the Company or with which the
Company combines.



Section 3. Administration.




     3.1 Authority of Committee. The Plan shall be administered by a Committee, which shall be
appointed by and serve at the pleasure of the Board; provided, however, with respect to Awards to
Outside Directors, all references in the Plan to the Committee shall be deemed to be references to
the Board. Subject to the terms of the Plan and applicable law, and in addition to other express
powers and authorizations conferred on the Committee by the Plan, the Committee shall have full
power and authority in its discretion (and in accordance with Section 409A of the Code with respect
to Awards subject thereto) to: (i) designate Participants; (ii) determine eligibility for
participation in the Plan and decide all questions concerning eligibility for and the amount of
Awards under the Plan; (iii) determine the type or types of Awards to be granted to a Participant;
(iv) determine the number of Shares



4









 







to be covered by, or with respect to which payments, rights or
other matters are to be calculated in connection with Awards; (v) determine the timing, terms, and
conditions of any Award; (vi) accelerate the time at which all or any
part of an Award may be settled or exercised; (vii) determine whether, to what extent, and
under what circumstances Awards may be settled or exercised in cash, Shares, other securities,
other Awards or other property, or canceled, forfeited or suspended and the method or methods by
which Awards may be settled, exercised, canceled, forfeited or suspended; (viii) determine whether,
to what extent, and under what circumstances cash, Shares, other securities, other Awards, other
property, and other amounts payable with respect to an Award shall be deferred either automatically
or at the election of the holder thereof or of the Committee; (ix) grant Awards as an alternative
to, or as the form of payment for grants or rights earned or payable under, other bonus or
compensation plans, arrangements or policies of the Company or a Subsidiary or Affiliate; (x) grant
Substitute Awards on such terms and conditions as the Committee may prescribe, subject to
compliance with the Incentive Stock Option rules under Section 422 of the Code and the nonqualified
deferred compensation rules under Section 409A of the Code, where applicable; (xi) make all
determinations under the Plan concerning any Participant’s Separation from Service with the Company
or a Subsidiary or Affiliate, including whether such separation occurs by reason of Cause, Good
Reason, Disability, Retirement, or in connection with a Change in Control and whether a leave
constitutes a Separation from Service; (xii) interpret and administer the Plan and any instrument
or agreement relating to, or Award made under, the Plan; (xiii) except to the extent prohibited by
Section 6.2, amend or modify the terms of any Award at or after grant with the consent of
the holder of the Award; (xiv) establish, amend, suspend or waive such rules and regulations and
appoint such agents as it shall deem appropriate for the proper administration of the Plan; and
(xv) make any other determination and take any other action that the Committee deems necessary or
desirable for the administration of the Plan, subject to the exclusive authority of the Board under
Section 14 hereunder to amend or terminate the Plan.



     3.2 Committee Discretion Binding. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations, and other decisions under or with respect to the
Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and
shall be final, conclusive, and binding upon all Persons, including the Company, any Subsidiary or
Affiliate, any Participant and any holder or beneficiary of any Award. A Participant or other
holder of an Award may contest a decision or action by the Committee with respect to such person or
Award only on the grounds that such decision or action was arbitrary or capricious or was unlawful,
and any review of such decision or action shall be limited to determining whether the Committee’s
decision or action was arbitrary or capricious or was unlawful.



     3.3 Delegation. Subject to the terms of the Plan and applicable law, the Committee may
delegate to one or more officers or managers of the Company or of any Subsidiary or Affiliate, or
to a Committee of such officers or managers, the authority, subject to such terms and limitations
as the Committee shall determine, to grant Awards to or to cancel, modify or waive rights with
respect to, or to alter, discontinue, suspend or terminate Awards held by Participants who are not
officers or directors of the Company for purposes of Section 16 or who are otherwise not subject to
such Section.



     3.4 No Liability. No member of the Board or Committee shall be liable for any action taken or
determination made in good faith with respect to the Plan or any Award granted hereunder.



Section 4. Shares Available For Awards.








     4.1 Shares Available. Subject to the provisions of Section 4.2 below, the maximum
aggregate number of Shares which may be issued pursuant to all Awards after the Effective Date of
this Plan is 1,750,000 Shares (the “Share Reserve”). The number of Shares with respect to which
Incentive Stock Options may be granted shall be no more than 1,000,000. Each Share issued pursuant to
an Option shall reduce the Share Reserve by one (1) share. Each Share subject to a redeemed
portion of a SAR shall reduce the Share Reserve by one (1) share. Each Share issued pursuant to a
Restricted Stock Award or a Restricted Stock Unit Award shall reduce the Share Reserve by one (1)
share. If any Award granted under this Plan (whether before or after the Effective Date of this
Plan) shall expire, terminate, be settled in cash (in whole or in part) or otherwise be forfeited
or canceled for any reason before it has vested or been exercised in full, the Shares subject to
such Award shall, to the extent of such expiration, cash settlement, forfeiture, or termination,
again be available for Awards under the Plan, in accordance with this Section 4.1. The
Committee may make such other determinations regarding the counting of Shares issued pursuant to
this Plan as it deems necessary or advisable, provided that such determinations shall be permitted
by law. Notwithstanding the foregoing,







5









 







if an Option or SAR is exercised, in whole or in part, by
tender of Shares or if the Company’s tax withholding obligation is satisfied by withholding Shares,
the number of Shares deemed to have been issued under the Plan for
purposes of the limitation set forth in this Section 4.1 shall be the number of Shares that
were subject to the Option or SAR or portion thereof, and not the net number of Shares actually
issued and any SARs to be settled in Shares shall be counted in full against the number of Shares
available for issuance under the Plan, regardless of the number of shares issued upon the
settlement of the SAR. Any Shares that again become available for grant pursuant to this Section
shall be added back as (i) one (1) Share if such Shares were subject to Options or Stock
Appreciation Rights granted under the Plan, and (ii) as one (1) Share if such Shares were subject
to Awards other than Options or Stock Appreciation Rights granted under the Plan. Notwithstanding
the foregoing and subject to adjustment as provided in Section 4.2 hereof, no Participant
may receive Options or SARs under the Plan in any calendar year that, taken together, relate to
more than 200,000 Shares.



     4.2 Adjustments. Without limiting the Committee’s discretion as provided in Section
13 hereof, in the event that the Committee determines that any dividend or other distribution
(whether in the form of cash, Shares, other securities or other property, and other than a normal
cash dividend), recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase or exchange of Shares or other
securities of the Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction or event affects the Shares, then
the Committee shall, in an equitable and proportionate manner as determined by the Committee (and,
as applicable, in such manner as is consistent with Sections 162(m), 422 and 409A of the Code and
the regulations thereunder) either: (i) adjust any or all of (1) the aggregate number of Shares or
other securities of the Company (or number and kind of other securities or property) with respect
to which Awards may be granted under the Plan; (2) the number of Shares or other securities of the
Company (or number and kind of other securities or property) subject to outstanding Awards under
the Plan, provided that the number of Shares subject to any Award shall always be a whole number;
(3) the grant or exercise price with respect to any Award under the Plan, and (4) the limits on the
number of Shares or Awards that may be granted to Participants under the Plan in any calendar year;
(ii) provide for an equivalent award in respect of securities of the surviving entity of any
merger, consolidation or other transaction or event having a similar effect; or (iii) make
provision for a cash payment to the holder of an outstanding Award. Any such adjustments to
outstanding Awards shall be effected in a manner that precludes the material enlargement of rights
and benefits under such Awards.



     4.3 Substitute Awards. Any Shares issued by the Company as Substitute Awards in connection
with the assumption or substitution of outstanding grants from any acquired corporation shall not
reduce the Shares available for Awards under the Plan.



     4.4 Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant to an Award may
consist, in whole or in part, of authorized and unissued Shares or of issued Shares which have been
reacquired by the Company.



Section 5. Eligibility.




     Any Employee, Director or Consultant shall be eligible to be designated a Participant;
provided, however, that Outside Directors shall only be eligible to receive Awards granted
consistent with Section 10.



Section 6. Stock Options And Stock Appreciation Rights.




     6.1 Grant. Subject to the provisions of the Plan, the Committee shall have sole and complete
authority to determine the Participants to whom Options and SARs shall be granted, the number of
Shares subject to each Award, the exercise price and the conditions and limitations applicable to
the exercise of each Option and SAR. An Option may be granted with or without a related SAR. An
SAR may be granted with or without a related Option. The grant of an Option or SAR shall occur
when the Committee by resolution, written consent or other appropriate action determines to grant
such Option or SAR for a particular number of Shares to a particular Participant at a particular
Option Price or Grant Price, as the case may be, or such later date as the Committee shall specify
in such resolution, written consent or other appropriate action. The Committee shall have the
authority to grant Incentive Stock Options and to grant Non-Qualified Stock Options. In the case
of Incentive Stock Options, the terms and conditions of such grants shall be subject to and comply
with Section 422 of the Code, as from time to time amended, and any regulations implementing such
statute. To the extent the aggregate Fair Market Value (determined at the time the Incentive Stock



6









 







Option is granted) of the Shares with respect to which all Incentive Stock Options are exercisable
for the first time by an Employee during any calendar year (under all plans described in Section
422(d) of the Code of the Employee’s
employer corporation and its parent and Subsidiaries) exceeds $100,000, such Options shall be
treated as Non-Qualified Stock Options.



     6.2 Price. The Committee in its sole discretion shall establish the Option Price at the time
each Option is granted and the Grant Price at the time each SAR is granted. Except in the case of
Substitute Awards, the Option Price of an Option may not be less than the Fair Market Value of a
Share on the date of grant of such Option, and the Grant Price of an SAR may not be less than the
Fair Market Value of a Share on the date of grant of such SAR. In the case of Substitute Awards or
Awards granted in connection with an adjustment provided for in Section 4.2 hereof in the
form of Options or SARS, such grants shall have an Option Price (or Grant Price) per Share that is
intended to maintain the economic value of the Award that was replaced or adjusted as determined by
the Committee. Notwithstanding the foregoing and except as permitted by the provisions of
Section 4.2 hereof, the Committee shall not have the power to (i) amend the terms of
previously granted Options to reduce the Option Price of such Options, (ii) amend the terms of
previously granted SARs to reduce the Grant Price of such SARs, (iii) cancel such Options and grant
substitute Options with a lower Option Price than the cancelled Options, or (iv) cancel such SARs
and grant substitute SARs with a lower Grant Price than the cancelled SARs, in each case without
the approval of the Company’s stockholders.



     6.3 Term. Subject to the Committee’s authority under Section 3.1 and the provisions
of Section 6.6, each Option and SAR and all rights and obligations thereunder shall expire
on the date determined by the Committee and specified in the Award Agreement. The Committee shall
be under no duty to provide terms of like duration for Options or SARs granted under the Plan.
Notwithstanding the foregoing, but subject to Section 6.4(a) hereof, no Option or SAR shall
be exercisable after the expiration of ten (10) years from the date such Option or SAR was granted.



     6.4 Exercise.




     (a) Each Option and SAR shall be exercisable at such times and subject to such terms
and conditions as the Committee may, in its sole discretion, specify in the applicable Award
Agreement or thereafter. The Committee shall have full and complete authority to determine,
subject to Section 6.6 herein, whether an Option or SAR will be exercisable in full
at any time or from time to time during the term of the Option or SAR, or to provide for the
exercise thereof in such installments, upon the occurrence of such events and at such times
during the term of the Option or SAR as the Committee may determine. An Award Agreement may
provide that the period of time over which an Option, other than an Incentive Stock Option,
or SAR may be exercised shall be automatically extended if on the scheduled expiration of
such Award, the Participant’s exercise of such Award would violate applicable securities
law; provided, however, that during the extended exercise period the Option or SAR may only
be exercised to the extent such Award was exercisable in accordance with its terms
immediately prior to such scheduled expiration date; provided further, however, that such
extended exercise period shall end not later than thirty (30) days after the exercise of
such Option or SAR first would no longer violate such laws.




     (b) The Committee may impose such conditions with respect to the exercise of Options or
SARs, including without limitation, any relating to the application of federal, state or
foreign securities laws or the Code, as it may deem necessary or advisable. The exercise of
any Option granted hereunder shall be effective only at such time as the sale of Shares
pursuant to such exercise will not violate any state or federal securities or other laws.




     (c) An Option or SAR may be exercised in whole or in part at any time, with respect to
whole Shares only, within the period permitted thereunder for the exercise thereof, and
shall be exercised by written notice of intent to exercise the Option or SAR, delivered to
the Company at its principal office, and payment in full to the Company at the direction of
the Committee of the amount of the Option Price for the number of Shares with respect to
which the Option is then being exercised.




     (d) Payment of the Option Price shall be made in (i) cash or cash equivalents, (ii) at
the discretion of the Committee, by transfer, either actually or by attestation, to the
Company of unencumbered Shares previously acquired by the Participant, valued at the Fair
Market Value of such Shares on the date of exercise (or next succeeding trading date, if the
date of exercise is not a trading date), together with any



7









 







applicable withholding taxes,
such transfer to be upon such terms and conditions as determined by the Committee, (iii) by
a combination of (i) or (ii), or (iv) by any other method approved or accepted by the
Committee in its sole discretion, including, if the Committee so determines, (x) a cashless
(broker-assisted) exercise that complies with applicable laws or (y) withholding Shares
(net-exercise) otherwise deliverable to the Participant pursuant to the Option having an
aggregate Fair Market Value at the time of exercise equal to the total Option Price. Until
the optionee has been issued the Shares subject to such exercise, he or she shall possess no
rights as a stockholder with respect to such Shares. The Company reserves, at any and all
times in the Company’s sole discretion, the right to establish, decline to approve or
terminate any program or procedures for the exercise of Options by means of a method set
forth in subsection (iv) above, including with respect to one or more Participants specified
by the Company notwithstanding that such program or procedures may be available to other
Participants.




     (e) At the Committee’s discretion, the amount payable as a result of the exercise of an
SAR may be settled in cash, Shares or a combination of cash and Shares. A fractional Share
shall not be deliverable upon the exercise of a SAR but a cash payment will be made in lieu
thereof.



     6.5 Separation from Service. Except as otherwise provided in the applicable Award Agreement,
an Option or SAR may be exercised only to the extent that it is then exercisable, and if at all
times during the period beginning with the date of granting such Award and ending on the date of
exercise of such Award the Participant is an Employee, Non-Employee Director or Consultant, and
shall terminate immediately upon a Separation from Service by the Participant. An Option or SAR
shall cease to become exercisable upon a Separation from Service of the holder thereof.
Notwithstanding the foregoing provisions of this Section 6.5 to the contrary, the Committee
may determine in its discretion that an Option or SAR may be exercised following any such
Separation from Service, whether or not exercisable at the time of such separation; provided,
however, that in no event may an Option or SAR be exercised after the expiration date of such Award
specified in the applicable Award Agreement, except as provided in Section 6.4(a).



     6.6 Ten Percent Stock Rule. Notwithstanding any other provisions in the Plan, if at the time
an Option is otherwise to be granted pursuant to the Plan, the optionee or rights holder owns
directly or indirectly (within the meaning of Section 424(d) of the Code) Shares of the Company
possessing more than ten percent (10%) of the total combined voting power of all classes of Stock
of the Company or its parent or Subsidiary or Affiliate corporations (within the meaning of Section
422(b)(6) of the Code), then any Incentive Stock Option to be granted to such optionee or rights
holder pursuant to the Plan shall satisfy the requirement of Section 422(c)(5) of the Code, and the
Option Price shall be not less than one hundred ten percent (110%) of the Fair Market Value of the
Shares of the Company, and such Option by its terms shall not be exercisable after the expiration
of five (5) years from the date such Option is granted.



Section 7. Restricted Shares And Restricted Share Units.




     7.1 Grant.




     (a) Subject to the provisions of the Plan, the Committee shall have sole and complete
authority to determine the Participants to whom Restricted Shares and Restricted Share Units
shall be granted, the number of Restricted Shares and/or the number of Restricted Share
Units to be granted to each Participant, the duration of the period during which, and the
conditions under which, the Restricted Shares and Restricted Share Units may be forfeited to
the Company, and the other terms and conditions of such Awards. The Restricted Share and
Restricted Share Unit Awards shall be evidenced by Award Agreements in such form as the
Committee shall from time to time approve, which agreements shall comply with and be subject
to the terms and conditions provided hereunder and any additional terms and conditions
established by the Committee that are consistent with the terms of the Plan.




     (b) Each Restricted Share and Restricted Share Unit Award made under the Plan shall be
for such number of Shares as shall be determined by the Committee and set forth in the Award
Agreement containing the terms of such Restricted Share or Restricted Share Unit Award.
Such agreement shall set forth a period of time (not less than one year) during which the
grantee must remain in the continuous employment (or other service-providing capacity) of
the Company in order for the forfeiture and transfer restrictions to lapse. If the
Committee so determines, the restrictions may lapse during such restricted period in
installments with respect to specified portions of the Shares covered by the Restricted
Share or Restricted Share Unit



8









 







Award. The Award Agreement may also, in the discretion of
the Committee, set forth performance or other conditions that will subject the Shares to
forfeiture and transfer restrictions. The Committee may, at its
discretion, waive all or any part of the restrictions applicable to any or all outstanding
Restricted Share and Restricted Share Unit Awards.



     7.2 Delivery of Shares and Transfer Restrictions.




     (a) At the time a Restricted Share Award is granted, a certificate representing the
number of Shares awarded thereunder shall be registered in the name of the grantee. Such
certificate shall be held by the Company or any custodian appointed by the Company for the
account of the grantee subject to the terms and conditions of the Plan, and shall bear such
a legend setting forth the restrictions imposed thereon as the Committee, in its discretion,
may determine. The foregoing to the contrary notwithstanding, the Committee may, in its
discretion, provide that a Participant’s ownership of Restricted Shares prior to the lapse
of any transfer restrictions or any other applicable restrictions shall, in lieu of such
certificates, be evidenced by a “book entry” (i.e., a computerized or manual entry) in the
records of the Company or its designated agent in the name of the Participant who has
received such Award, and confirmation and account statements sent to the Participant with
respect to such book-entry Shares may bear the restrictive legend referenced in the
preceding sentence. Such records of the Company or such agent shall, absent manifest error,
be binding on all Participants who receive Restricted Share Awards evidenced in such manner.
The holding of Restricted Shares by the Company or such an escrow holder, or the use of
book entries to evidence the ownership of Restricted Shares, in accordance with this
Section 7.2(a), shall not affect the rights of Participants as owners of the
Restricted Shares awarded to them, nor affect the restrictions applicable to such shares
under the Award Agreement or the Plan, including the transfer restrictions.




     (b) Unless otherwise provided in the applicable Award Agreement, the grantee shall have
all rights of a stockholder with respect to the Restricted Shares, including the right to
receive dividends and the right to vote such Shares, subject to the following restrictions:
(i) the grantee shall not be entitled to delivery of the stock certificate until the
expiration of the restricted period and the fulfillment of any other restrictive conditions
set forth in the Award Agreement with respect to such Shares; (ii) none of the Shares may be
sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or disposed of
during such restricted period or until after the fulfillment of any such other restrictive
conditions; and (iii) except as otherwise determined by the Committee at or after grant, all
of the Shares shall be forfeited and all rights of the grantee to such Shares shall
terminate, without further obligation on the part of the Company, unless the grantee remains
in the continuous employment of the Company for the entire restricted period in relation to
which such Shares were granted and unless any other restrictive conditions relating to the
Restricted Share Award are met. Restricted Share Units shall be subject to similar transfer
restrictions as Restricted Share Awards, except that no Shares are actually awarded to a
Participant who is granted Restricted Share Units on the date of grant, and such Participant
shall have no rights of a stockholder with respect to such Restricted Share Units until the
restrictions set forth in the applicable Award Agreement have lapsed.



     7.3 Termination of Restrictions. At the end of the restricted period and provided that any
other restrictive conditions of the Restricted Share Award are met, or at such earlier time as
otherwise determined by the Committee, all restrictions set forth in the Award Agreement relating
to the Restricted Share Award or in the Plan shall lapse as to the Restricted Shares subject
thereto, and a stock certificate for the appropriate number of Shares, free of the restrictions and
restricted stock legend, shall be delivered to the Participant or the Participant’s beneficiary or
estate, as the case may be (or, in the case of book-entry Shares, such restrictions and restricted
stock legend shall be removed from the confirmation and account statements delivered to the
Participant or the Participant’s beneficiary or estate, as the case may be, in book-entry form).



     7.4 Payment of Restricted Share Units. Each Restricted Share Unit shall have a value equal to
the Fair Market Value of a Share. Restricted Share Units may be paid in cash, Shares, other
securities or other property, as determined in the sole discretion of the Committee, upon the lapse
of the restrictions applicable thereto, or otherwise in accordance with the applicable Award
Agreement. The applicable Award Agreement shall specify whether a Participant will be entitled to
receive dividend equivalent rights in respect of Restricted Share Units at the time of any payment
of dividends to stockholders on Shares. If the applicable Award Agreement specifies that a
Participant will be entitled to dividend equivalent rights, (i) the amount of any such dividend
equivalent right shall equal the



9









 







amount that would be payable to the Participant as a stockholder
in respect of a number of Shares equal to the number of vested Restricted Share Units then credited
to the Participant, and (ii) any such dividend equivalent right
shall be paid in accordance with the Company’s payment practices as may be established from time to
time and as of the date on which such dividend would have been payable in respect of outstanding
Shares (and in accordance with Section 409A of the Code with regard to Awards subject thereto);
provided, that no dividend equivalents shall be paid on Restricted Share Units that are not yet
vested. Except as otherwise determined by the Committee at or after grant, Restricted Share Units
may not be sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or disposed
of, and all Restricted Share Units and all rights of the grantee to such Restricted Share Units
shall terminate, without further obligation on the part of the Company, unless the grantee remains
in continuous employment of the Company for the entire restricted period in relation to which such
Restricted Share Units were granted and unless any other restrictive conditions relating to the
Restricted Share Unit Award are met.



Section 8. Performance Awards.




     8.1 Grant. The Committee shall have sole and complete authority to determine the Participants
who shall receive a Performance Award, which shall consist of a right that is (i) denominated in
cash or Shares (including but not limited to Restricted Shares and Restricted Share Units), (ii)
valued, as determined by the Committee, in accordance with the achievement of such performance
goals during such performance periods as the Committee shall establish, and (iii) payable at such
time and in such form as the Committee shall determine.



     8.2 Terms and Conditions. Subject to the terms of the Plan and any applicable Award
Agreement, the Committee shall determine the performance goals to be achieved during any
performance period, the length of any performance period, the amount of any Performance Award and
the amount and kind of any payment or transfer to be made pursuant to any Performance Award, and
may amend specific provisions of the Performance Award; provided, however, that such amendment may
not adversely affect existing Performance Awards made within a performance period commencing prior
to implementation of the amendment.



     8.3 Payment of Performance Awards. Performance Awards may be paid in a lump sum or in
installments following the close of the performance period or, in accordance with the procedures
established by the Committee, on a deferred basis. Separation from Service prior to the end of any
performance period, other than for reasons of death or Disability, will result in the forfeiture of
the Performance Award, and no payments will be made. Notwithstanding the foregoing, the Committee
may in its discretion, waive any performance goals and/or other terms and conditions relating to a
Performance Award. A Participant’s rights to any Performance Award may not be sold, assigned,
transferred, pledged, hypothecated or otherwise encumbered or disposed of in any manner, except by
will or the laws of descent and distribution, and/or except as the Committee may determine at or
after grant.



Section 9. Other Stock-Based Awards.




     The Committee shall have the authority to determine the Participants who shall receive an
Other Stock-Based Award, which shall consist of any right that is (i) not an Award described in
Sections 6 and 7 above and (ii) an Award of Shares or an Award denominated or
payable in, valued in whole or in part by reference to, or otherwise based on or related to, Shares
(including, without limitation, securities convertible into Shares), as deemed by the Committee to
be consistent with the purposes of the Plan. Subject to the terms of the Plan and any applicable
Award Agreement, the Committee shall determine the terms and conditions of any such Other
Stock-Based Award.



Section 10. Non-Employee Director And Outside Director Awards.




     10.1 The Board may provide that all or a portion of a Non-Employee Director’s annual retainer,
meeting fees and/or other awards or compensation as determined by the Board, be payable (either
automatically or at the election of a Non-Employee Director) in the form of Non-Qualified Stock
Options, Restricted Shares, Restricted Share Units and/or Other Stock-Based Awards, including
unrestricted Shares. The Board shall determine the terms and conditions of any such Awards,
including the terms and conditions which shall apply upon a termination of the Non-Employee
Director’s service as a member of the Board, and shall have full power and authority in its
discretion to administer such Awards, subject to the terms of the Plan and applicable law.



10









 





     10.2 The Board may also grant Awards to Outside Directors pursuant to the terms of the Plan,
including any Award described in Sections 6, 7 and 9 above. With respect
to such Awards, all references in the Plan to the Committee shall be deemed to be references to the
Board.



Section 11. Provisions Applicable To Covered Officers And Performance Awards.




     11.1 Notwithstanding anything in the Plan to the contrary, unless the Committee determines
that a Performance Award to be granted to a Covered Officer should not qualify as
“performance-based compensation” for purposes of Section 162(m), Performance Awards granted to
Covered Officers shall be subject to the terms and provisions of this Section 11.



     11.2 The Committee may grant Performance Awards to Covered Officers based solely upon the
attainment of performance targets related to one or more performance goals selected by the
Committee from among the goals specified below. For the purposes of this Section 11,
performance goals shall be limited to one or more of the following Company, Subsidiary, operating
unit, business segment or division financial performance measures:




	 	(a)	 	earnings before any one or more of the following: interest,
taxes, depreciation, amortization and/or stock compensation;
	 
	 	(b)	 	operating (or gross) income or profit;
	 
	 	(c)	 	operating efficiencies;
	 
	 	(d)	 	return on equity, assets, capital, capital employed or
investment;
	 
	 	(e)	 	after tax operating income;
	 
	 	(f)	 	net income;
	 
	 	(g)	 	earnings or book value per Share;
	 
	 	(h)	 	financial ratios;
	 
	 	(i)	 	cash flow(s);
	 
	 	(j)	 	total sales or revenues or sales or revenues per employee;
	 
	 	(k)	 	production (separate work units or SWUs);
	 
	 	(l)	 	stock price or total stockholder return;
	 
	 	(m)	 	dividends;
	 
	 	(n)	 	debt or cost reduction;
	 
	 	(o)	 	strategic business objectives, consisting of one or more
objectives based on meeting specified cost targets, business expansion goals
(including, without limitation, developmental, strategic or manufacturing
milestones of products or projects in development, execution of contracts with
current or prospective customers and development of business expansion
strategies) and goals relating to acquisitions, joint ventures or collaborations
or divestitures; or
	 
	 	(p)	 	any combination thereof.





Each goal may be expressed on an absolute and/or relative basis, may be based on or otherwise
employ comparisons based on internal targets, the past performance of the Company or any
Subsidiary, operating unit, business segment or




11









 








division of the Company and/or the past or current
performance of other companies, and in the case of earnings-based measures, may use or employ
comparisons relating to capital, stockholders’ equity and/or Shares outstanding, or to assets or
net assets. The Committee may appropriately adjust any evaluation of performance under criteria
set forth in this Section 11.2 to exclude any of the following events that occurs during a
performance period: (i) asset impairments or write-downs, (ii) litigation or claim judgments or
settlements, (iii) the effect of changes in tax law, accounting principles or other such laws or
provisions affecting reported results, (iv) accruals for reorganization and restructuring programs,
(v) any extraordinary non-recurring items as described in Accounting Principles Board Opinion No.
30 and/or in management’s discussion and analysis of financial condition and results of operations
appearing in the Company’s annual report to stockholders for the applicable year, (vi) the effect
of adverse federal, governmental or regulatory action, or delays in federal, governmental or
regulatory action or (vii) any other event either not directly related to the operations of the
Company or not within the reasonable control of the Company’s management; provided that the
Committee commits to make any such adjustments within the 90 day period set forth in Section
11.4.




     11.3 With respect to any Covered Officer, the maximum annual number of Shares in respect of
which all Performance Awards may be granted under Section 8 of the Plan is 200,000 and the
maximum amount of all Performance Awards that are settled in cash and that may be granted under
Section 8 of the Plan in any year is $2,000,000.



     11.4 In the case of grants of Performance Awards with respect to which compliance with Section
162(m) is intended, no later than 90 days following the commencement of each performance period (or
such other time as may be required or permitted by Section 162(m) of the Code), the Committee
shall, in writing, (1) select the performance goal or goals applicable to the performance period,
(2) establish the various targets and bonus amounts which may be earned for such performance
period, and (3) specify the relationship between performance goals and targets and the amounts to
be earned by each Covered Officer for such performance period. Following the completion of each
performance period, the Committee shall certify in writing whether the applicable performance
targets have been achieved and the amounts, if any, payable to Covered Officers for such
performance period. In determining the amount earned by a Covered Officer for a given performance
period, subject to any applicable Award Agreement, the Committee shall have the right to reduce
(but not increase) the amount payable at a given level of performance to take into account
additional factors that the Committee may deem relevant in its sole discretion to the assessment of
individual or corporate performance for the performance period.



     11.5 Unless otherwise expressly stated in the relevant Award Agreement, each Award granted to
a Covered Officer under the Plan is intended to be performance-based compensation within the
meaning of Section 162(m). Accordingly, unless otherwise determined by the Committee, if any
provision of the Plan or any Award Agreement relating to such an Award does not comply or is
inconsistent with Section 162(m), such provision shall be construed or deemed amended to the extent
necessary to conform to such requirements, and no provision shall be deemed to confer upon the
Committee discretion to increase the amount of compensation otherwise payable to a Covered Officer
in connection with any such Award upon the attainment of the performance criteria established by
the Committee.



Section 12. Separation from Service.




     The Committee shall have the full power and authority to determine the terms and conditions
that shall apply to any Award upon a Separation from Service with the Company, its Subsidiaries and
Affiliates, including a separation from the Company with or without Cause, by a Participant
voluntarily, or by reason of death, Disability, Early Retirement or Retirement, and may provide
such terms and conditions in the Award Agreement or in such rules and regulations as it may
prescribe.



Section 13. Change In Control.




     13.1 Certain Terminations. Unless otherwise provided by the Committee, or in an Award
Agreement or by a contractual agreement between the Company and a Participant, if, within one year
following a Change in Control, a Participant Separates from Service with the Company (or its
successor) by reason of (a) death; (b) Disability; (c) Normal Retirement or Early Retirement; (d)
for Good Reason by the Participant; or (e) involuntary termination by the Company for any reason
other than for Cause, all outstanding Awards of such Participant shall vest, become immediately
exercisable and payable and have all restrictions lifted. For purposes of an Award subject



12









 







to Section 409A of the Code, Good Reason shall exist only if (i) the Participant notifies the Company
of the event establishing Good Reason within 90 days of its initial existence, (ii) the Company is
provided 30 days to cure such
event and (iii) the Participant Separates from Service with the Company (or its successor) within
180 days of the initial occurrence of the event.



     13.2 Accelerated Vesting. The Committee may (in accordance with Section 409A, to the extent
applicable), in its discretion, provide in any Award Agreement, or, in the event of a Change in
Control, may take such actions as it deems appropriate to provide, for the acceleration of the
exercisability, vesting and/or settlement in connection with such Change in Control of each or any
outstanding Award or portion thereof and Shares acquired pursuant thereto upon such conditions (if
any), including termination of the Participant’s service prior to, upon, or following such Change
in Control, to such extent as the Committee shall determine. In the event of a Change of Control,
and without the consent of any Participant, the Committee may, in its discretion, provide that for
a period of at least fifteen (15) days prior to the Change in Control, any Options or Stock
Appreciation Rights shall be exercisable as to all Shares subject thereto and that upon the
occurrence of the Change in Control, such Stock Options or Stock Appreciation Rights shall
terminate and be of no further force and effect.



     13.3 Assumption, Continuation or Substitution. In the event of a Change in Control, the
surviving, continuing, successor, or purchasing corporation or other business entity or parent
thereof, as the case may be (the "Acquiror"), may (in accordance with Section 409A, to the extent
applicable), without the consent of any Participant, either assume or continue the Company’s rights
and obligations under each or any Award or portion thereof outstanding immediately prior to the
Change in Control or substitute for each or any such outstanding Award or portion thereof a
substantially equivalent award with respect to the Acquiror’s stock, as applicable; provided, that
in the event of such an assumption, the Acquiror must grant the rights set forth in Section
13.1 to the Participant in respect of such assumed Awards. For purposes of this Section, if so
determined by the Committee, in its discretion, an Award denominated in Shares shall be deemed
assumed if, following the Change in Control, the Award (as adjusted, if applicable, pursuant to
Section 4.2 hereof) confers the right to receive, subject to the terms and conditions of
the Plan and the applicable Award Agreement, for each Share subject to the Award immediately prior
to the Change in Control, the consideration (whether stock, cash, other securities or property or a
combination thereof) to which a holder of a share of Stock on the effective date of the Change in
Control was entitled; provided, however, that if such consideration is not solely common stock of
the Acquiror, the Committee may, with the consent of the Acquiror, provide for the consideration to
be received upon the exercise or settlement of the Award, for each Share subject to the Award, to
consist solely of common stock of the Acquiror equal in Fair Market Value to the per share
consideration received by holders of Shares pursuant to the Change in Control. Any Award or portion
thereof which is neither assumed or continued by the Acquiror in connection with the Change in
Control nor exercised or settled as of the time of consummation of the Change in Control shall
terminate and cease to be outstanding effective as of the time of consummation of the Change in
Control.



     13.4 Cash-Out of Awards. The Committee may (in accordance with Section 409A, to the extent
applicable), in its discretion at or after grant and without the consent of any Participant,
determine that, upon the occurrence of a Change in Control, each or any Award or a portion thereof
outstanding immediately prior to the Change in Control and not previously exercised or settled
shall be canceled in exchange for a payment with respect to each vested Share (and each unvested
Share, if so determined by the Committee) subject to such canceled Award in (i) cash, (ii) stock of
the Company or of a corporation or other business entity a party to the Change in Control, or (iii)
other property which, in any such case, shall be in an amount having a Fair Market Value equal to
the Fair Market Value of the consideration to be paid per Share in the Change in Control, reduced
by the exercise or purchase price per share, if any, under such Award (which payment may, for the
avoidance of doubt, be $0, in the event the per share exercise or purchase price of an Award is
greater than the per share consideration in connection with the Change in Control). In the event
such determination is made by the Committee, the amount of such payment (reduced by applicable
withholding taxes, if any), if any, shall be paid to Participants in respect of the vested portions
of their canceled Awards as soon as practicable following the date of the Change in Control and may
be paid in respect of the unvested portions of their canceled Awards in accordance with the vesting
schedules applicable to such Awards.



     13.5 Performance Awards. The Committee may (in accordance with Section 409A, to the extent
applicable), in its discretion at or after grant, provide that in the event of a Change in Control,
(i) any outstanding Performance Awards relating to performance periods ending prior to the Change
in Control which have been earned



13









 







but not paid shall become immediately payable, (ii) all
then-in-progress performance periods for Performance Awards that are outstanding shall end, and
either (A) any or all Participants shall be deemed to have earned an
award equal to the relevant target award opportunity for the performance period in question, or (B)
at the Committee’s discretion, the Committee shall determine the extent to which performance
criteria have been met with respect to each such Performance Award, if at all, and (iii) the
Company shall cause to be paid to each Participant such partial or full Performance Awards, in
cash, Shares or other property as determined by the Committee, within thirty (30) days of such
Change in Control, based on the Change in Control consideration, which amount may be zero if
applicable. In the absence of such a determination, any Performance Awards relating to performance
periods that will not have ended as of the date of a Change in Control shall be terminated and
canceled for no further consideration.



Section 14. Amendment And Termination.




     14.1 Amendments to the Plan. The Board may amend, alter, suspend, discontinue or terminate
the Plan or any portion thereof at any time (and in accordance with Section 409A of the Code with
regard to Awards subject thereto); provided that no such amendment, alteration, suspension,
discontinuation or termination shall be made without stockholder approval if such approval is
necessary to comply with any tax or regulatory requirement for which or with which the Board deems
it necessary or desirable to comply.



     14.2 Amendments to Awards. Subject to the restrictions of Section 6.2, the Committee
may waive any conditions or rights under, amend any terms of or alter, suspend, discontinue, cancel
or terminate, any Award theretofore granted, prospectively or retroactively in time (and in
accordance with Section 409A of the Code with regard to Awards subject thereto); provided that any
such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination that
would materially and adversely affect the rights of any Participant or any holder or beneficiary of
any Award theretofore granted shall not to that extent be effective without the consent of the
affected Participant, holder or beneficiary.



     14.3 Adjustments of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events. The
Committee is hereby authorized to make equitable and proportionate adjustments in the terms and
conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring
events (and shall make such adjustments for the events described in Section 4.2 hereof)
affecting the Company, any Subsidiary or Affiliate, or the financial statements of the Company or
any Subsidiary or Affiliate, or of changes in applicable laws, regulations or accounting
principles.



Section 15. General Provisions.




     15.1 Limited Transferability of Awards. Except as otherwise provided in the Plan, an Award
Agreement or by the Committee at or after grant, no Award shall be assigned, alienated, pledged,
attached, sold or otherwise transferred or encumbered by a Participant, except by will or the laws
of descent and distribution. No transfer of an Award by will or by laws of descent and
distribution shall be effective to bind the Company unless the Company shall have been furnished
with written notice thereof and an authenticated copy of the will and/or such other evidence as the
Committee may deem necessary or appropriate to establish the validity of the transfer. No transfer
of an Award for value shall be permitted under the Plan.



     15.2 Dividend Equivalents. In the sole and complete discretion of the Committee, an Award may
provide the Participant with dividends or dividend equivalents, payable in cash, Shares, other
securities or other property on a current or deferred basis. All dividend or dividend equivalents
which are not paid currently may, at the Committee’s discretion, accrue interest, be reinvested
into additional Shares, or, in the case of dividends or dividend equivalents credited in connection
with Performance Awards, be credited as additional Performance Awards and paid to the Participant
if and when, and to the extent that, payment is made pursuant to such Award. The total number of
Shares available for grant under Section 4 shall not be reduced to reflect any dividends or
dividend equivalents that are reinvested into additional Shares or credited as Performance Awards.
Notwithstanding the foregoing, with respect to an Award subject to Section 409A of the Code, the
payment, deferral or crediting of any dividends or dividend equivalents shall conform to the
requirements of Section 409A of the Code and such requirements shall be specified in writing.



14









 





     15.3. Compliance with Section 409A of the Code. No Award (or modification thereof) shall
provide for deferral of compensation that does not comply with Section 409A of the Code unless the
Committee, at the time of
grant, specifically provides that the Award is not intended to comply with Section 409A of the
Code. Notwithstanding any provision of this Plan to the contrary, if one or more of the payments
or benefits received or to be received by a Participant pursuant to an Award would cause the
Participant to incur any additional tax or interest under Section 409A of the Code, the Committee
may reform such provision to maintain to the maximum extent practicable the original intent of the
applicable provision without violating the provisions of Section 409A of the Code. In addition, if
a Participant is a Specified Employee at the time of his or her Separation from Service, any
payments with respect to any Award subject to Section 409A of the Code to which the Participant
would otherwise be entitled by reason of such Separation from Service shall be made on the date
that is six months after the Participant’s Separation from Service (or, if earlier, the date of the
Participant’s death). Although the Company intends to administer the Plan so that Awards will be
exempt from, or will comply with, the requirements of Section 409A of the Code, the Company does
not warrant that any Award under the Plan will qualify for favorable tax treatment under Section
409A of the Code or any other provision of federal, state, local or foreign law. The Company shall
not be liable to any Participant for any tax, interest, or penalties that Participant might owe as
a result of the grant, holding, vesting, exercise, or payment of any Award under the Plan.



     15.4 No Rights to Awards. No Person shall have any claim to be granted any Award, and there
is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards.
The terms and conditions of Awards need not be the same with respect to each Participant.



     15.5 Share Certificates. All certificates for Shares or other securities of the Company or
any Subsidiary or Affiliate delivered under the Plan pursuant to any Award or the exercise thereof
shall be subject to such stop transfer orders and other restrictions as the Committee may deem
advisable under the Plan or the rules, regulations and other requirements of the SEC or any state
securities commission or regulatory authority, any stock exchange or other market upon which such
Shares or other securities are then listed, and any applicable Federal or state laws, and the
Committee may cause a legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.



     15.6 Tax Withholding. A Participant may be required to pay to the Company or any Subsidiary
or Affiliate and the Company or any Subsidiary or Affiliate shall have the right and is hereby
authorized to withhold from any Award, from any payment due or transfer made under any Award or
under the Plan, or from any compensation or other amount owing to a Participant the amount (in
cash, Shares, other securities, other Awards or other property) of any applicable withholding or
other tax-related obligations in respect of an Award, its exercise or any other transaction
involving an Award, or any payment or transfer under an Award or under the Plan and to take such
other action as may be necessary in the opinion of the Company to satisfy all obligations for the
payment of such taxes. The Committee may provide for additional cash payments to holders of
Options to defray or offset any tax arising from the grant, vesting, exercise or payment of any
Award. Without limiting the generality of the foregoing, the Committee may in its discretion
permit a Participant to satisfy or arrange to satisfy, in whole or in part, the tax obligations
incident to an Award by: (a) electing to have the Company withhold Shares or other property
otherwise deliverable to such Participant pursuant to the Award (provided, however, that the amount
of any Shares so withheld shall not exceed the amount necessary to satisfy required federal, state
local and foreign withholding obligations using the minimum statutory withholding rates for
federal, state, local and/or foreign tax purposes, including payroll taxes, that are applicable to
supplemental taxable income) and/or (b) tendering to the Company Shares owned by such Participant
(or by such Participant and his or her spouse jointly) and purchased or held for the requisite
period of time as may be required to avoid the Company’s or the Affiliates’ or Subsidiaries’
incurring an adverse accounting charge, based, in each case, on the Fair Market Value of the Shares
on the payment date as determined by the Committee. All such elections shall be irrevocable, made
in writing, signed by the Participant, and shall be subject to any restrictions or limitations that
the Committee, in its sole discretion, deems appropriate.



     15.7 Award Agreements. Each Award hereunder shall be evidenced by an Award Agreement that
shall be delivered to the Participant and may specify the terms and conditions of the Award and any
rules applicable thereto. In the event of a conflict between the terms of the Plan and any Award
Agreement, the terms of the Plan shall prevail. The Committee shall, subject to applicable law,
determine the date an Award is deemed to be granted. The Committee or, except to the extent
prohibited under applicable law, its delegate(s) may establish the terms of agreements or other
documents evidencing Awards under this Plan and may, but need not, require as a condition to any
such agreement’s or document’s effectiveness that such agreement or document be executed by the
Participant,



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including by electronic signature or other electronic indication of acceptance, and
that such Participant agree to such further terms and conditions as specified in such agreement or
document. The grant of an Award under this Plan
shall not confer any rights upon the Participant holding such Award other than such terms, and
subject to such conditions, as are specified in this Plan as being applicable to such type of Award
(or to all Awards) or as are expressly set forth in the agreement or other document evidencing such
Award.



     15.8 No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall prevent
the Company or any Subsidiary or Affiliate from adopting or continuing in effect other compensation
arrangements, which may, but need not, provide for the grant of Options, Restricted Shares,
Restricted Share Units, Other Stock-Based Awards or other types of Awards provided for hereunder.



     15.9 No Right to Employment. The grant of an Award shall not be construed as giving a
Participant the right to be retained in the employ of the Company or any Subsidiary or Affiliate.
Further, the Company or a Subsidiary or Affiliate may at any time dismiss a Participant from
employment, free from any liability or any claim under the Plan, unless otherwise expressly
provided in an Award Agreement.



     15.10 No Rights as Stockholder. Subject to the provisions of the Plan and the applicable
Award Agreement, no Participant or holder or beneficiary of any Award shall have any rights as a
stockholder with respect to any Shares to be distributed under the Plan until such person has
become a holder of such Shares. Notwithstanding the foregoing, in connection with each grant of
Restricted Shares hereunder, the applicable Award Agreement shall specify if and to what extent the
Participant shall not be entitled to the rights of a stockholder in respect of such Restricted
Shares.



     15.11 Governing Law. The validity, construction and effect of the Plan and any rules and
regulations relating to the Plan and any Award Agreement shall be determined in accordance with the
laws of the State of Delaware without giving effect to conflicts of laws principles.



     15.12 Severability. If any provision of the Plan or any Award is, or becomes, or is deemed to
be invalid, illegal or unenforceable in any jurisdiction or as to any Person or Award, or would
disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision
shall be construed or deemed amended to conform to the applicable laws, or if it cannot be
construed or deemed amended without, in the determination of the Committee, materially altering the
intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, Person
or Award and the remainder of the Plan and any such Award shall remain in full force and effect.



     15.13 Other Laws. The Committee may refuse to issue or transfer any Shares or other
consideration under an Award if, acting in its sole discretion, it determines that the issuance or
transfer of such Shares or such other consideration might violate any applicable law or regulation
(including applicable non-U.S. laws or regulations) or entitle the Company to recover the same
under Exchange Act Section 16(b), and any payment tendered to the Company by a Participant, other
holder or beneficiary in connection with the exercise of such Award shall be promptly refunded to
the relevant Participant, holder or beneficiary.



     15.14 No Trust or Fund Created. Neither the Plan nor any Award shall create or be construed
to create a trust or separate fund of any kind or a fiduciary relationship between the Company or
any Subsidiary or Affiliate and a Participant or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any Subsidiary or Affiliate pursuant to an
Award, such right shall be no greater than the right of any unsecured general creditor of the
Company or any Subsidiary or Affiliate.



     15.15 No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the
Plan or any Award, and the Committee shall determine whether cash, other securities or other
property shall be paid or transferred in lieu of any fractional Shares or whether such fractional
Shares or any rights thereto shall be canceled, terminated or otherwise eliminated.



     15.16 Headings. Headings are given to the sections and subsections of the Plan solely as a
convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.



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Section 16. Term Of The Plan.




     16.1
Effective Date. The Plan shall be effective upon the later to
occur of (i) its adoption by the Board or (ii) immediately prior to
the Registration Date (the “Effective Date”).



     16.2 Expiration Date. No new Awards shall be granted under the Plan after the tenth
(10th) anniversary of the Effective Date. Unless otherwise expressly provided in the
Plan or in an applicable Award Agreement, any Award granted hereunder may, and the authority of the
Board or the Committee to amend, alter, adjust, suspend, discontinue or terminate any such Award or
to waive any conditions or rights under any such Award shall, continue after the tenth
(10th) anniversary of the Effective Date.




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