EX-10.27



 Exhibit 10.27 

 
 



 
 EQUITY AWARD GRANT POLICY 
 I. General Scope 
 This Equity Award Grant Policy (this
“Policy”) establishes the process for Monotype Imaging Holdings Inc. (the “Company”) to follow when it grants shares of restricted stock, stock options or other equity-based awards (collectively, “Equity
Awards”) to an officer or employee of the Company or any of its direct or indirect subsidiaries (each, an “Employee”) pursuant to the Monotype Imaging Holdings Inc. Amended and Restated 2007 Stock Option and Incentive Plan,
as amended from time to time (the “2007 Plan”), or any other equity compensation plan of the Company that the Board of Directors or the Management Development and Compensation Committee (the “Compensation Committee”)
determines to be subject to this Policy (collectively, with the 2007 Plan, the “Plans”). A list of the Plans is set forth on Exhibit A. This Policy does not apply to grants of Equity Awards to non-employee directors or other
eligible persons under the Plans who are not Employees. Additionally, notwithstanding the foregoing, in recognition of the special considerations that may apply to certain types of performance-based Equity Awards, this Policy does not apply
automatically to grants of Equity Awards that are made or earned upon the achievement of previously determined performance-based parameters under the Plans. 
 II. Grant Date of Equity Awards 
 While the Plans may permit the granting of
Equity Awards at any time, the Company will generally only grant Equity Awards on a regularly scheduled basis. Doing so will enhance the effectiveness of the Company’s internal control over its Equity Award grant process and alleviate some of
the burdens related to accounting for Equity Awards in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”). If extraordinary circumstances arise such that the Compensation Committee
or the Board of Directors determines it is advisable to grant an Equity Award at a time other than as set forth below, the Compensation Committee may consider and approve any such grant. 
 Initial and Promotion Grants 
 Grants of Equity Awards made in conjunction
with the hiring of a new Employee or the promotion of an existing Employee will be made on a regular monthly basis on the fifteenth day of each month, unless the fifteenth is not a day on which the NASDAQ Global Select Market (or such other market
on which the Company’s common stock is then principally listed) is open for trading in which case it shall be the next such trading day (each, a “Monthly Approval Date”). These initial and promotion grants shall be made
effective (each, a “Grant Date”) as follows: 
  

	 	•	 	 With respect to an individual whose employment began or whose promotion occurred prior to or on the Monthly Approval Date, on such Monthly Approval
Date; and 










	 	•	 	 With respect to an individual whose employment begins or whose promotion occurs on a date after the Monthly Approval Date, on the next Monthly Approval
Date. 


 Annual Grants 
 Grants of Equity Awards to existing Employees (other than in connection with a promotion) will be made, if at all, on an annual basis. It is the intention of the Compensation Committee to consider and
approve any such annual grants at a meeting to be held as soon as all necessary information is available to the Compensation Committee (the “Annual Approval Date”). These annual grants shall be made effective (again, a
“Grant Date”) as follows: 
  

	 	•	 	 If the Annual Approval Date is on or before the third business day following the filing of the Company’s Form 10-K, unless such day is not a day
on which the NASDAQ Global Select Market (or such other market on which the Company’s common stock is then principally listed) is open for trading in which case it shall be the next such trading day (a “Release Clearance Date”), then
on such Release Clearance Date; and 


  

	 	•	 	 If the Annual Approval Date is after the Release Clearance Date, then on the Annual Approval Date. 



III. Approval of Equity Awards 

Compensation Committee Approval 
 Other than as set forth in the CEO Guidelines described in the next section, all Equity Award grants must be approved in advance by the Compensation Committee. All Equity Award grants approved by the
Compensation Committee should be discussed and voted upon at an in-person or telephonic meeting of the Compensation Committee. The minutes of such meetings at which Equity Award grants are approved will list the name of each grantee, the type and
amount of Equity Awards he or she is granted, the scheduled grant date in accordance with this Policy, the vesting schedule for the Equity Awards and any other non-standard material terms. If restricted stock is approved, the amount of the grant may
be denominated in dollars or may be approved as a specific number of shares. If stock options are approved, the amount of the grant will be either the number of shares subject to the stock option or the fair market value of the award calculated
under ASC 718. If extraordinary circumstances arise necessitating such action, the Compensation Committee may approve an Equity Award grant by unanimous consent in writing or by electronic transmission (rather than as part of a meeting). Any such
consent in writing or by electronic transmission will be effective as of the latest date it is signed or transmitted by all members of the Compensation Committee, respectively, and, therefore, the Grant Date may not be prior to such latest date.


  
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 CEO Guidelines 
 The Company’s Chief Executive Officer (the “CEO”) shall have authority to grant Equity Awards subject to the following guidelines: 

 

			
	  	  	CEO Can Approve
	 Direct report to CEO or Vice President or above
	  	No
	 Related Person of CEO (as defined in the Company’s Related Person
Transaction Approval Policy)
	  	No
	 Equity Awards other than Stock Options or Restricted Stock
Awards
	  	No
	 Stock Options of 20,001 shares or greater
	  	No
	 Stock Options of less than 20,001 shares (1)(2)(3)
	  	Yes
	 Restricted Stock Awards of 10,001 or greater
	  	No
	 Restricted Stock Awards of less than 10,001 shares (1)(2)(3)
	  	Yes

 Notes: 

	1.	If Equity Awards being authorized would be over annual equity budget approved by the Board of Directors, Compensation Committee approval is required, even if the Equity
Award is less than the level stated here. 


	2.	The aggregate value of any equity award authorized by the CEO cannot, on the grant date, have a fair market value of greater than the amount of the recipient’s
annual base salary. 


	3.	CEO cannot authorize Equity Awards of any sort to any individual of more than 20,000 shares in a calendar year. 


The CEO shall report any award made pursuant to the authority above to the Compensation Committee at its next regularly scheduled
meeting. 
 With respect to any Equity Award not described above, the Board of Directors and the Compensation Committee will
provide guidelines to the CEO from time to time setting forth the amounts and types of Equity Awards under the 2007 Plan that may be granted to Employees in conjunction with their hiring or promotion, in all cases, consistent with the terms of the
2007 Plan. All such Equity Awards shall be recommended by the CEO to the Compensation Committee and shall remain subject to approval by the Compensation Committee. 
 IV. Equity Award Pricing and Calculation 
 All Equity Awards will be priced
and calculated on the Grant Date in the manner described below. 
 Restricted Stock 

The number of shares of restricted stock that are issued will be calculated by dividing the dollar value of the approved award by the
closing market price on the NASDAQ Global Select Market (or such other market on which the Company’s common stock is then principally listed) of a share of the Company’s common stock on the Grant Date, unless a specific number of shares to
be awarded has been approved. 

  
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 Stock Options 
 The exercise price of all stock options will be equal to (or, if specified in the approval of the stock option award, greater than) the closing market price on the NASDAQ Global Select Market (or such
other market on which the Company’s common stock is then principally listed) of a share of the Company’s common stock on the Grant Date. If the amount of the award is to be determined by reference to a fair value calculated under ASC 718,
then the number of shares to be subject to such stock option shall be determined based on such fair value, the exercise price determined in accordance with the preceding sentence and the approved valuation assumptions, subject to any other limits on
the number of shares that may be subject to such stock option. 
 V. Informing Recipients of Equity Awards 

With respect to all Equity Awards, the Company will provide a notice to each Equity Award grantee promptly after the approval of such
Equity Award. The awards are deemed to be made on the date the key terms of the grants are communicated to Grantee either (i) by email, (ii) in writing, or (iii) through posting in the Grantee’s online E*TRADE brokerage account
with respect to Company equity awards. The Company will maintain appropriate records of the Equity Award Agreements, either electronically or via another method of the Company’s choice, at the Company’s principal office, at the
offices of the Company’s subsidiaries or through a vendor of the Company’s choice. 
 VI. Miscellaneous 

The Compensation Committee has the sole power and authority to interpret the terms of this Policy and such interpretations will be binding
on all persons. This Policy may be modified or amended at any time by the Board of Directors or the Compensation Committee. 
  

	
	 APPROVED: January 10, 2007

	
	 AMENDED: April 30, 2009

	
	 AMENDED: July 30, 2009

	
	 AMENDED: February 25, 2013



  
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 EXHIBIT A 

Plans 
 Amended and
Restated 2007 Stock Option and Incentive Plan 
 2010 Inducement Stock Plan 

  
 A-1