Exhibit 10.1


 


AMENDED AND RESTATED


 


KNOLL, INC.


 


2010 STOCK INCENTIVE
PLAN

(effective as of May 5, 2010)


 


1.                                      Purpose


 


The Amended and Restated Knoll, Inc. 2010 Stock Incentive Plan, as
set forth herein and as amended from time to time, (the “Plan”) is intended to
provide incentives that will attract, retain, motivate and reward highly
competent persons as officers, certain other key employees, directors and
consultants of Knoll, Inc. (the “Company”) or any of its subsidiary
corporations, limited liability companies or other forms of business entities
now existing or hereafter formed or acquired (“Subsidiaries”), by providing
them opportunities to acquire shares of the common stock, par value $.01 per
share, of the Company (“Common Stock”) or to receive monetary payments based on
the value of such shares pursuant to Awards (as defined in Section 4)
described herein.  Furthermore, the Plan
is intended to assist in further aligning the interests of the Company’s
officers, other key employees, directors and consultants with those of its
stockholders.


 


2.                                      Administration


 


a.             The
Plan shall be administered by a committee (the “Committee”) which shall be the
Compensation Committee of the Board of Directors of the Company (the “Board”)
or another committee appointed by the Board from among its members.  Unless the Board determines otherwise, the
Committee shall be comprised solely of at least two members who each shall
qualify as a (i) “Non-Employee Director” within the meaning of Rule 16b-3(b)(3) (or
any successor rule) under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) and (ii) an “outside director” within the meaning of Section 162(m) of
the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations
thereunder.  The Committee is authorized,
subject to the provisions of the Plan to establish such rules and
regulations as it deems necessary for the proper administration of the Plan, to
make such determinations and interpretations and to take such action in
connection with the Plan and any Awards granted hereunder as it deems necessary
or advisable, in its sole discretion. 
All determinations and interpretations made by the Committee shall be
binding and conclusive on all participants and their legal representatives.


 


b.             No
member of the Board, no member of the Committee and no agent of the Committee
who is an employee of the Company shall be liable for any act or failure to act
hereunder, except in circumstances involving his or her bad faith, gross
negligence or willful misconduct, or for any act or failure to act hereunder by
any other member or employee or by any agent to whom duties in connection with
the administration of this Plan have been delegated.  The Company shall indemnify members of the
Board, members of the Committee and any agent of the Committee who is an
employee of the Company against any and all liabilities or expenses to which
they may be subjected by reason of any act or failure to act with respect to
their duties


 

















 


on behalf of the Plan, except in circumstances involving such person’s
bad faith, gross negligence or willful misconduct.


 


c.             The
Committee shall have the authority to grant Awards to officers, other key
employees, directors and consultants of the Company or any of its
Subsidiaries.  The Committee may delegate
to one or more of its members, or to one or more agents, such administrative
duties as it may deem advisable, and the Committee, or any person to whom it
has delegated duties as aforesaid, may employ one or more persons to render
advice with respect to any responsibility the Committee or such person may have
under the Plan.  The Committee may employ
such legal or other counsel, consultants and agents as it may deem desirable
for the administration of the Plan and may rely upon any opinion or computation
received from any such counsel, consultant or agent.  Expenses incurred by the Committee in the
engagement of such counsel, consultant or agent shall be paid by the Company or
any of its Subsidiaries whose employees have benefited from the Plan, as
determined by the Committee.


 


3.                                      Participants


 


Participants shall consist of such officers, other key employees,
directors and consultants (including employees of a consultant, provided that
such employee is actually providing bona fide consulting services to the
Company) of the Company or any of its Subsidiaries as the Committee in its sole
discretion determines to have significant responsibility for the success and
future growth and profitability of the Company and whom the Committee may
designate from time to time to receive Awards under the Plan.  Designation of a participant in any year
shall not require the Committee to designate such person to receive an Award in
any other year or, once designated, to receive the same type or amount of Award
as granted to the participant in any other year.  The Committee shall consider such factors as
it deems pertinent in selecting participants and in determining the type and
amount of Awards.


 


4.                                      Types of Awards and Vesting Restrictions


 


a.             Awards
under the Plan may be granted in any one or a combination of (1) Stock
Options, (2) Stock Appreciation Rights, (3) Stock Awards, (4) Performance
Awards and (5) Stock Units (each as described above an “Award,” and
collectively, “Awards”).  Stock Awards,
Performance Awards and Stock Units may, as determined by the Committee in its
discretion, constitute Performance-Based Awards, as described in Section 11.  Awards shall be evidenced by Award agreements
(which need not be identical) in such forms as the Committee may from time to
time approve; provided, however,
that in the event of any conflict between the provisions of the Plan and any
such agreements, the provisions of the Plan shall prevail.


 


b.             Awards
shall be subject to forfeiture as determined by the Committee and set forth in
the applicable Award agreement, provided however, that:


 


(1)                                  No more than
one-third of any Stock Award or Stock Unit shall become vested in any single
annual period, except, as determined by the Committee, in the case of the
participant’s death, disability or retirement or a Change in Control (as
defined in Section 13b), provided that this restriction shall not apply to
(A) a Performance Award (as defined in


 


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Section 10) or (B) an
Award that is  granted in lieu of cash
compensation foregone at the election of an employee, director or consultant of
the Company; and


 


(2)                                  A Stock Award
or Stock Unit that is a Performance Award shall become vested no sooner than
the first anniversary of the date of grant of such Award except, as determined
by the Committee, in the case of the participant’s death, disability or
retirement or a Change in Control.


 


5.                                      Common Stock Available Under the Plan


 


a.             Shares Available.  Subject to any adjustments made in accordance
with Section 12, the aggregate number of shares of Common Stock that may
be granted or issued pursuant to Awards, including shares of Common Stock
subject to Stock Options, shall be 2,000,000 shares of Common Stock, all of
which may be issued pursuant to the exercise of Incentive Stock Options, which
may be authorized and unissued or treasury shares.


 


b.             Individual Limitation.  The number of shares of Common Stock with
respect to which Stock Options and Stock Appreciation Rights may be granted to
any individual during any calendar year shall not exceed 500,000 shares of
Common Stock, subject to adjustment in accordance with Section 12.  The number of shares of Common Stock with
respect to which Stock Awards, Performance Awards and Stock Units may be
granted during any calendar year shall not exceed 250,000 shares of Common
Stock, subject to adjustment in accordance with Section 12.


 


c.             Shares Underlying Awards That Again Become Available.  Any shares of Common Stock subject to a Stock
Option, Stock Appreciation Right, Stock Award, Performance Award, or Stock Unit
which for any reason is cancelled or forfeited shall again be available for
Awards under the Plan.  The preceding
sentence shall apply only for purposes of determining the aggregate number of
shares of Common Stock subject to Awards pursuant to Section 5a but shall
not apply for purposes of determining the maximum number of Awards that any
individual participant may be granted in any calendar year.


 


6.                                      Stock Options


 


a.             In General.  The Committee is authorized to grant Stock
Options to officers, other key employees, directors and consultants of the
Company or any of its Subsidiaries and shall, in its sole discretion, determine
such participants in the Plan who will receive Stock Options and the number of
shares of Common Stock underlying each Stock Option.  Stock Options may be (i) incentive stock
options (“Incentive Stock Options”) within the meaning of Section 422 of
the Code, or (ii) Stock Options which do not qualify as Incentive Stock
Options (“Nonqualified Stock Options”). 
The Committee may grant to any participant one or more Incentive Stock
Options, Nonqualified Stock Options, or both types of Stock Options.  Each Stock Option shall be subject to such
terms and conditions consistent with the Plan as shall be determined by the
Committee and as set forth in the Award agreement.  In addition, each Stock Option shall be
subject to the following limitations set forth in this Section 6.


 


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b.             Exercise Price.  Each Stock Option granted hereunder shall
have such per-share exercise price as the Committee may determine on the date
of grant; provided, however,
subject to Section 6(e), that the per-share exercise price shall not be
less than 100 percent of the Fair Market Value (as defined in Section 16)
of Common Stock on the date the Stock Option is granted.


 


c.             Payment of Exercise Price.  The Stock Option exercise price may be paid
in cash or, in the discretion of the Committee, by the delivery of shares of Common
Stock then owned by the participant, by the withholding of shares of Common
Stock for which a Stock Option is exercisable, or by a combination of these
methods.  In the discretion of the
Committee, a payment may also be made by delivering a properly executed
exercise notice to the Company together with a copy of irrevocable instructions
to a broker to deliver promptly to the Company the amount of sale or loan
proceeds to pay the exercise price with the requirement of the broker same day
reconciliation or as otherwise determined by the Company.  To facilitate the foregoing, the Company may
enter into agreements for coordinated procedures with one or more brokerage
firms.  The Committee may prescribe any
other method of paying the exercise price that it determines to be consistent
with applicable law and the purpose of the Plan, including, without limitation,
in lieu of the exercise of a Stock Option by delivery of shares of Common Stock
then owned by a participant for at least six months, providing the Company with
a notarized statement attesting to the number of shares owned, where upon
verification by the Company, the Company would issue to the participant only
the number of incremental shares to which the participant is entitled upon
exercise of the Stock Option.  In
determining which methods a participant may utilize to pay the exercise price,
the Committee may consider such factors as it determines are appropriate; provided, however, that with respect to
Incentive Stock Options, all such discretionary determinations shall be made at
the time of grant and specified in the Award agreement.


 


d.             Exercise Period.  Stock Options granted under the Plan shall be
exercisable at such time or times as specified in the Plan and the Award
agreement; provided, however,
that no Stock Option shall be exercisable later than ten years after the date
it is granted.


 


e.             Limitations on Incentive Stock Options.  Incentive Stock Options may be granted only
to participants who are officers or other key employees of the Company or any
of its Subsidiaries on the date of grant. 
The aggregate market value (determined as of the time the Stock Option
is granted) of Common Stock with respect to which Incentive Stock Options
(under all option plans of the Company) are exercisable for the first time by a
participant during any calendar year shall not exceed $100,000.  For purposes of the preceding sentence,
Incentive Stock Options shall be taken into account in the order in which they
are granted.  Incentive Stock Options may
not be granted to any participant who, at the time of grant, owns stock
possessing (after the application of the attribution rules of Section 424(d) of
the Code) more than 10 percent of the total combined voting power of all
outstanding classes of stock of the Company or any of its Subsidiaries, unless
the exercise price is fixed at not less than 110 percent of the Fair Market
Value of Common Stock on the date of grant and the exercise of such option is
prohibited by its terms after the expiration of 5 years from the date of grant
of such option.


 


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7.                                      Stock Appreciation Rights


 


The Committee is authorized to grant Stock Appreciation Rights to
officers, other key employees, directors and consultants of the Company or any
of its Subsidiaries and shall, in its sole discretion, determine such
participants who will receive Stock Appreciation Rights and the number of
shares of Common Stock with respect to each Stock Appreciation Right.  A “Stock Appreciation Right” shall mean a
right to receive a payment in cash, Common Stock or a combination thereof, in
an amount equal to the excess of (x) the Fair Market Value (or some lesser
amount), of a specified number of shares of Common Stock on the date the Stock
Appreciation Right is exercised over (y) the Fair Market Value of such
shares of Common Stock on the date the Stock Appreciation Right is granted, or
other specified valuation (which shall be no less than the Fair Market Value as
of the date the Stock Appreciation Right is granted) (the “Grant Price”), with
the number of shares of Common Stock represented by the Stock Appreciation
Right as determined by the Committee. 
Each Stock Appreciation Right shall be subject to such terms and
conditions consistent with the Plan as shall be determined by the Committee and
as set forth in the Award agreement.


 


8.                                      Stock Awards


 


The Committee is authorized to grant Stock Awards to officers, other
key employees, directors and consultants of the Company or any of its
Subsidiaries and shall, in its sole discretion, determine such participants in
the Plan who will receive Stock Awards and the number of shares of Common Stock
underlying each Stock Award.  A “Stock
Award” is an immediate grant of a specified number of shares of Common Stock,
with such number of shares of Common Stock determined by the Committee.  Each Stock Award shall be subject to such
terms and conditions consistent with the Plan as shall be determined by the
Committee and as set forth in the Award agreement, including, without limitation,
restrictions on the sale or other disposition of such shares, and the right of
the Company to reacquire such shares for no consideration upon termination of
the participant’s employment within specified periods.  The Committee may require the participant to
deliver a duly signed stock power, endorsed in blank, relating to Common Stock
covered by such Stock Award and/or that the stock certificates evidencing such
shares be held in custody or bear restrictive legends until the restrictions
thereon shall have lapsed.  The Stock
Award agreement shall specify whether the participant shall have, with respect
to the shares of Common Stock subject to a Stock Award, all of the rights of a
holder of shares of Common Stock, including the right to receive dividends and
to vote the shares.


 


9.                                      Stock Units


 


a.             In General.  The Committee is authorized to grant Stock
Units to officers, other key employees, directors and consultants of the
Company or any of its Subsidiaries and shall, in its sole discretion, determine
such officers, other key employees, directors and consultants who will receive
Stock Units and the number of shares of Common Stock with respect to each Stock
Unit.  The Committee shall determine the
criteria for the vesting of Stock Units. 
A Stock Unit granted by the Committee shall provide payment in shares of
Common Stock at such time as the Award agreement shall specify.  Shares of Common Stock issued pursuant to
this Section 9 may


 


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be issued with or without other payments therefor as may be required by
applicable law or such other consideration as may be determined by the
Committee.  The Committee shall determine
whether a participant granted a Stock Unit shall be entitled to a Dividend
Equivalent Right (as defined below). 
Each Stock Unit shall be subject to such terms and conditions consistent
with the Plan as shall be determined by the Committee and as set forth in the
Award agreement.


 


b.             Payout. 
Upon vesting of a Stock Unit, unless the Committee has determined to
defer payment with respect to such unit or a participant has elected to defer
payment under Section 10(c), shares of Common Stock representing the Stock
Units shall be distributed to the participant unless the Committee, with the
consent of the participant, provides for the payment of the Stock Units in cash
or partly in cash and partly in shares of Common Stock equal to the value of
the shares of Common Stock which would otherwise be distributed to the
participant.


 


c.             Definitions.  A “Stock Unit” shall mean a notional account
representing one share of Common Stock. 
A “Dividend Equivalent Right” shall mean the right to receive the amount
of any dividend paid on the share of Common Stock underlying a Stock Unit,
which shall be payable in cash or in the form of additional Stock Units, at the
time set forth in the Award Agreement or as deferred pursuant to Section 10(c).


 


10.                               Performance Awards


 


a.             In General.  The Committee is authorized to grant
Performance Awards to officers and other key employees, directors and
consultants of the Company or any of its Subsidiaries and shall, in its sole
discretion, determine such participants who will receive Performance Awards,
provided however that directors may not receive Incentive Stock Options.  A “Performance Award” is a Stock Option,
Stock Award or Stock Unit, the vesting or payment of which is conditioned on
the satisfaction of performance criteria. 
Each Performance Award shall be subject to such terms and conditions
consistent with the Plan as shall be determined by the Committee and as set
forth in the Award agreement.  The
Committee shall set performance targets at its discretion which, depending on
the extent to which they are met, will determine the number and/or value of
Performance Awards that will be paid out to the participants, and may attach to
such Performance Awards one or more restrictions.  Performance targets may be based upon,
without limitation, Company-wide, divisional and/or individual performance.


 


b.             Adjustment of Performance Targets.  With respect to those Performance Awards that
are not intended to qualify as Performance-Based Awards (as described in Section 11),
the Committee shall have the authority at any time to make adjustments to
performance targets for any outstanding Performance Awards which the Committee
deems necessary or desirable to prevent dilution or enlargement of the rights
of participants in the event of, in recognition of, or in anticipation of, any
unanticipated, unusual nonrecurring or extraordinary corporate item,
transaction, event or development; or in response to, or in anticipation of,
changes in applicable laws, regulations, accounting principles, or business
conditions.


 


c.             Payout. 
Payment of earned Performance Awards may be made in shares of Common
Stock, in cash or any combination of the two and shall be made in accordance
with the terms and conditions prescribed or authorized by the Committee.  The participant may elect to


 


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defer, or the Committee may require or permit the deferral of, the
receipt of Performance Awards, provided that, the election to defer receipt of
Performance Awards must occur no later than thirty (30) days after such
Performance Award is granted, and otherwise in compliance with applicable tax
law.


 


11.                               Performance-Based Awards


 


a.             In General.  All Stock Options and Stock Appreciation
Rights granted under the Plan, and the compensation attributable to such
Awards, are intended to qualify as  “performance-based
compensation” (as such term is used in Section 162(m) of the Code and
the regulations thereunder) and thus be exempt from the deduction limitation
imposed by Section 162(m) of the Code.  Stock Awards, Performance
Awards and Stock Units may be granted in a manner such that such Awards
qualify as “performance-based compensation” and thus be exempt from the
deduction limitation imposed by Section 162(m) of the Code  All Awards that qualify as “performance-based
compensation” are referred to herein as “Performance-Based Awards.”  An Award shall qualify as a Performance-Based
Award only if at the time of grant the Committee is comprised solely of two or
more “outside directors” (as such term is used in Section 162(m) of
the Code and the regulations thereunder).


 


b.             Performance Measures.  Stock Awards, Performance Awards, and Stock
Units granted under the Plan should qualify as Performance-Based Awards if, as
determined by the Committee, in its discretion, either the granting or vesting
of such Award is subject to the achievement of a performance target or targets
based on one or more performance measures. 
The Committee may use the following performance measures (either
individually or in any combination) to set performance targets with respect to
Awards intended to qualify as Performance-Based Awards:  operating profits, revenue growth, gross
profit margin, operating profit margin, net sales; pretax income before
allocation of corporate overhead and bonus; budget; earnings per share; net
income; division, group or corporate financial goals; return on stockholders’
equity; return on assets; attainment of strategic and operational initiatives;
appreciation in and/or maintenance of the price of Common Stock or any other
publicly-traded securities of the Company; market share; gross profits;
earnings before interest and taxes; earnings before interest, taxes,
depreciation and amortization; economic value-added models; comparisons with
various stock market indices; and/or reductions in costs.


 


c.             Adjustment of Performance Measures.  The Committee shall have the authority at any
time to make adjustments to performance measures for any outstanding
Performance-Based Awards which the Committee deems necessary or desirable to
prevent dilution or enlargement of the rights of participants in the event of,
in recognition of, or in anticipation of, any unanticipated, unusual
nonrecurring or extraordinary corporate item, transaction, event or
development; or in response to, or in anticipation of, changes in applicable
laws, regulations, accounting principles, or business conditions.


 


12.                               Adjustment Provisions


 


If there shall be any change in Common Stock of the Company, through
merger, consolidation, reorganization, recapitalization, stock dividend, stock
split, reverse stock split,


 


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split up, spinoff, combination of shares, exchange of
shares, dividend in kind or other like change in capital structure or
distribution (other than normal cash dividends) to stockholders of the Company,
an adjustment shall be made to each outstanding Stock Option and Stock
Appreciation Right such that each such Stock Option and Stock Appreciation
Right shall thereafter be exercisable for such securities, cash and/or other
property as would have been received in respect of Common Stock subject to such
Stock Option or Stock Appreciation Right had such Stock Option or Stock
Appreciation Right been exercised in full immediately prior to such change or
distribution, and such an adjustment shall be made successively each time any such
change shall occur.  In addition, in the
event of any such change or distribution, in order to prevent dilution or
enlargement of participants’ rights under the Plan, the Committee shall have
the authority to adjust, in an equitable manner, the number and kind of shares
that may be issued under the Plan, the number and kind of shares subject to
outstanding Awards, the exercise price applicable to outstanding Awards, and
the Fair Market Value of Common Stock and other value determinations applicable
to outstanding Awards.  Appropriate
adjustments may also be made by the Committee in the terms of any Awards under
the Plan to reflect such changes or distributions and to modify any other terms
of outstanding Awards on an equitable basis, including modifications of
performance targets and changes in the length of performance periods.  In addition, other than with respect to Stock
Options, Stock Appreciation Rights and other Awards intended to constitute
Performance-Based Awards, the Committee is authorized to make adjustments to
the terms and conditions of, and the criteria included in, Awards in
recognition of unusual or nonrecurring events affecting the Company or any of
its Subsidiaries or the financial statements of the Company, or in response to
changes in applicable laws, regulations, or accounting principles.  Notwithstanding the foregoing, (i) any
adjustment with respect to an Incentive Stock Option shall comply with the rules of
424(a) of the Code, (ii) any adjustment with respect to a Stock
Option that is not an Incentive Stock Option shall comply with the rules of
Section 409A of the Code, and (iii) in no event shall any adjustment
be made which would render any Incentive Stock Option granted hereunder other
than an incentive stock option for purposes of Section 422 of the Code.


 


13.                               Change In Control


 


a.             Accelerated Vesting.  Notwithstanding any other provision of this
Plan, if there is a Change in Control of the Company (as defined in Section 13b),
all unvested Awards granted under the Plan shall become fully vested
immediately upon the occurrence of the Change of Control, unless otherwise
determined by the Committee as set forth in the Award Agreement, and such
vested Awards shall be paid out or settled, as applicable, to the extent
determined by the Committee. 
Notwithstanding the foregoing, to the extent an amount is subject to Section 409A
of the Code, no amounts payable pursuant to this Section 13 shall be
payable unless the event triggering such payment would constitute a “change in
control” as defined in Section 409A of the Code.


 


b.             Definition.  For purposes of this Section 13, (i) if
there is an employment agreement or a change in control agreement between the
participant and the Company or any of its Subsidiaries in effect, “Change in
Control” shall have the same definition as the definition of “Change in Control”
contained in such employment agreement or change in control agreement (unless
such definition does not comply with Section 409A(2)(c)(v) of the
Code), or (ii) if


 


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“Change in Control” is not defined in such employment agreement or
change in control agreement (or such definition does not comply with Section 409A(2)(c)(v) of
the Code), or if there is no employment agreement or change in control
agreement between the participant and the Company or any of its Subsidiaries in
effect, a “Change in Control” of the Company shall be deemed to have occurred
upon any of the following events:


 


(1)                                  any person or
other entity (other than any of the Company’s Subsidiaries or any employee
benefit plan sponsored by the Company or any of its Subsidiaries) including any
person as defined in Section 13(d)(3) of the Exchange Act, becomes
the beneficial owner, as defined in Rule 13d-3 under the Exchange Act,
directly or indirectly, of more than 50% of the total combined voting power of
all classes of capital stock of the Company normally entitled to vote for the
election of directors of the Company (the “Voting Stock”);


 


(2)                                  the Company
consummates the sale of all or substantially all of the property or assets of
the Company;


 


(3)                                  the Company
consummates a consolidation or merger of the Company with another corporation
(other than with any of the Company’s Subsidiaries), and as a result,  the stockholders of the Company immediately
before the occurrence of the consolidation or merger own, in the aggregate, not
more than 50% of the Voting Stock of the surviving entity; or


 


(4)                                  a change in the
Company’s Board occurs with the result that, within any 12-month period, the
members of the Board as of the beginning of such period (the “Incumbent
Directors”) no longer constitute a majority of such Board, provided that any
person becoming a director (other than a director whose initial assumption of
office is in connection with an actual or threatened election contest or the
settlement thereof, including but not limited to a consent solicitation,
relating to the election of directors of the Company) whose election or
nomination for election was supported by at least a majority of the then
Incumbent Directors shall be considered an Incumbent Director for purposes
hereof.


 


This definition shall be interpreted and applied as
necessary to avoid imposition of the taxes and interest under Section 409A
of the Code.


 


14.                               Transferability


 


Each Award granted under the Plan to a participant shall not be
transferable otherwise than by will or the laws of descent and distribution and
shall be exercisable, during the participant’s lifetime, only by the
participant.  Notwithstanding the
foregoing, the Committee may in its sole discretion allow for the transfer of
an Award (other than an Incentive Stock Option) to other persons or entities,
subject to such conditions or limitations as the Committee may establish.


 


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15.                               Other Provisions


 


Awards granted under the Plan may also be subject to such other
provisions (whether or not applicable to the Award granted to any other
participant) as the Committee determines on the date of grant to be
appropriate, including, without limitation, for the installment purchase of
Common Stock under Stock Options, for the installment exercise of Stock
Appreciation Rights, to assist the participant, excluding an officer or a
director, in financing the acquisition of Common Stock, for the forfeiture of,
or restrictions on resale or other disposition of, Common Stock acquired under
any form of the Award, for the acceleration of exercisability or vesting of
Awards in the event of a change in control of the Company, or to comply with
federal and state securities laws, or understandings or conditions as to the
participant’s employment, in addition to those specifically provided for under
the Plan.  In addition, except as
otherwise provided herein, a participant may defer receipt or payment of any
Award granted under this Plan, in accord with the terms of any deferred
compensation plan or arrangement of the Company.


 


16.                               Fair Market Value


 


For purposes of this Plan and any Awards granted hereunder, Fair Market
Value shall mean (i) the closing price of Common Stock on the date of
calculation (or on the last preceding trading date if Common Stock was not
traded on such date) if Common Stock is readily tradeable on a national
securities exchange or other market system or (ii) if Common Stock is not
readily tradeable, the amount determined by the Committee in a manner
consistent with Section 409A of the Code, or, in the case of shares of
Common Stock underlying Incentive Stock Options, the amount determined by the
Committee in a manner consistent with Section 422 of the Code.


 


17.                               Withholding


 


At such time that the delivery of shares of Common Stock or other
disposition of an Award to a participant becomes subject to tax withholding
requirements, the Company may require that the participant pay to the Company
such amount as the Company deems necessary to satisfy its obligation to
withhold Federal, state or local income or other taxes.  The Committee, in its discretion, may elect
to pay such amount by having the Company withhold shares of Common Stock which
would otherwise be delivered to such participant having an aggregate Fair
Market Value equal to such amount.


 


18.                               Tenure


 


A participant’s right, if any, to continue to serve the Company as an
officer, other key employee, director or otherwise shall not be enlarged or
otherwise affected by his or her designation as a participant under the Plan.


 


19.                               Unfunded Plan


 


Participants shall have no right, title, or interest whatsoever in or
to any investments which the Company may make to aid it in meeting its obligations
under the Plan.  Nothing contained in the
Plan, and no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary relationship between
the Company and any


 


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participant, beneficiary, legal representative or any
other person.  To the extent that any
person acquires a right to receive payments from the Company under the Plan,
such right shall be no greater than the right of an unsecured general creditor
of the Company.  All payments to be made
hereunder shall be paid from the general funds of the Company and no special or
separate fund shall be established and no segregation of assets shall be made
to assure payment of such amounts except as expressly set forth in the
Plan.  The Plan is not intended to be
subject to the Employee Retirement Income Security Act of 1974, as amended.


 


20.                               No Fractional Shares


 


No
fractional shares of Common Stock shall be issued or delivered pursuant to the
Plan or any Award.  The Committee shall
determine whether cash, or Awards, or other property shall be issued or paid in
lieu of fractional shares or whether such fractional shares or any rights
thereto shall be forfeited or otherwise eliminated.


 


21.                               Duration, Amendment and Termination


 


No Award shall be granted more than ten years after the Effective Date;
provided, however, that the terms and
conditions applicable to any Award granted prior to such date may thereafter be
amended or modified by mutual agreement between the Company and the participant
or such other persons as may then have an interest therein.  Also, by mutual agreement between the Company
and a participant under this Plan or under any other present or future plan of
the Company, Awards may be granted to such participant in substitution and
exchange for, and in cancellation of, any Awards previously granted to such
participant under this Plan, or any other present or future plan of the
Company, provided that, such substitution or exchange is permitted under
applicable law, including, but not limited to, Sections 409A and 422 of the
Code.  The Board or the Committee may
amend the Plan from time to time or suspend or terminate the Plan at any time.  However, no action authorized by this Section 21
shall reduce the amount of any existing Award or change the terms and
conditions thereof without the participant’s consent.  Notwithstanding the foregoing in this Section 21,
no amendment of the Plan and no amendment of any Award shall, without approval
of the stockholders of the Company, (i) increase the total number of
shares which may be issued under the Plan or the maximum number of shares with
respect to Stock Options, Stock Appreciation Rights and other Awards that may
be granted to any individual under the Plan; (ii) modify the requirements
as to eligibility for Awards under the Plan; (iii) permit Stock Options,
Stock Appreciation Rights or other Awards encompassing rights to purchase
Common Stock to be repriced, replaced or regranted through cancellation, or by
lowering the per-share exercise price of a previously granted Stock Option or
the Grant Price of a previously granted Stock Appreciation Right, or the
purchase price of any other previously granted Award that encompasses the right
to purchase Common Stock; or (iv) have the effect of disqualifying any
Incentive Stock Options previously granted hereunder.


 


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22.                               Compliance with Law


 


a.             Governing
Law.  This Plan, Awards granted hereunder
and actions taken in connection herewith shall be governed and construed in
accordance with the laws of Delaware (regardless of the law that might
otherwise govern under applicable Delaware principles of conflict of laws).


 


b.             Section 409A
Compliance.  Notwithstanding any other
provision of this Plan to the contrary, all Awards under this Plan shall be
designed and administered in a manner that does not result in the imposition of
tax or penalties under Section 409A of the Code.


 


23.                               Severability


 


In case any provision of this Plan shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining  provisions shall not in any way be affected
or impaired thereby.


 


24.                               Effective Date


 


a.             The
Plan shall be effective as of the date on which the Plan is approved by the
stockholders of the Company at an annual meeting or any special meeting of
stockholders of the Company (the “Effective Date”) and such approval of
stockholders shall be a condition to the right of each participant to receive
Awards hereunder.


 


b.             This
Plan shall terminate on the 10th anniversary of the Effective Date (unless
sooner terminated by the Board).


 


*   *   *


 


As adopted by the Board of Directors of 


Knoll, Inc. as of May 5, 2010


 


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