Document:

Exhibit 10.1

 

SEPARATION AND CONSULTING AGREEMENT

 

This SEPARATION AND CONSULTING AGREEMENT (this “Agreement”) is made and entered into as of August 1, 2018 (the “Effective Date”) by and between Tactile Systems Technology, Inc., a Delaware corporation (the “Company”), and Lynn Blake, a resident of Minnesota (“Blake”).

 

BACKGROUND

 

A.                                    Blake began her employment with the Company on or about April 27, 2016 and currently serves as the Company’s Chief Financial Officer.

 

B.                                    Blake and the Company are parties to an Employment Agreement that was entered into as of April 27, 2016 (the “Employment Agreement”).

 

C.                                    Under the Employment Agreement, for each calendar year of employment with the Company, Blake is eligible for an annual target bonus in an amount of 50% of Blake’s base salary earned during such calendar year (the “Bonus”), based upon and subject to criteria set by the Compensation Committee (the “Committee”) of the Board of Directors of the Company.  On March 12, 2018, the Committee approved an award under the Company’s Management Incentive Plan for the Company’s 2018 calendar year to Blake with a target dollar amount of $160,500 to provide the criteria for the Bonus.

 

D.                                    During employment with the Company, Blake received one or more equity-based incentive awards (the “Equity Awards”).

 

E.                                     Blake has decided to voluntarily separate from employment with the Company effective September 1, 2018 (the “Termination Date”).

 

F.                                      The parties have agreed that, effective September 2, 2018 (such that there is no lapse in service to the Company and the Equity Awards held by Blake will continue to vest in accordance with the terms and conditions set forth in the Equity Awards), Blake will provide certain consulting services to the Company under the terms of this Agreement.

 

G.                                    The parties are mutually concluding their employment relationship amicably, but mutually recognize that such a relationship may give rise to potential claims or liabilities.

 

NOW THEREFORE, in consideration of the mutual promises and provisions contained in this Agreement and the Release (as defined below), the parties, intending to be legally bound, agree as follows:

 

AGREEMENT

 

1.                                      Termination of Employment.  Blake hereby acknowledges the termination of her employment with the Company effective as of the Termination Date.  Blake further acknowledges that her separation from employment with the Company is a voluntary resignation by Blake for reasons other than Good Reason (as defined in the Employment Agreement) and therefore Blake is not eligible or entitled to receive any severance payments or benefits under the Employment Agreement.

 

2.                                      Resignation as an Officer.  Blake agrees that she shall resign as an officer with the Company or any Affiliates (as defined in the Employment Agreement) effective as of the Termination Date, or such earlier date as requested in writing by the Company.  In the event the

 

 

Company makes a written request that Blake resign as an officer earlier than the Termination Date, Blake will still remain as an employee until the Termination Date, such that there will be no lapse in service to the Company, and the Equity Awards held by Blake shall continue to vest in accordance with the terms and conditions set forth in the Equity Awards.

 

3.                                      2018 Bonus.  If the Committee approves the payment of bonuses to the Company’s executive officers in February or March 2019 under the Company’s Management Incentive Plan, the Company agrees that Blake will receive a prorated Bonus amount for calendar year 2018 calculated by determining the Bonus Blake would have received under the Management Incentive Plan had Blake remained employed by the Company through the date the Committee approves the payment of bonuses in February or March 2019 multiplied by a fraction, the numerator of which is the number of days Blake was employed by the Company in 2018 through the Termination Date and the denominator of which is 365.  Any such amount will be paid to Blake no later than March 15, 2019.  Neither the Company nor the Committee shall take any action unique to Blake (that does not apply to the Company’s Chief Executive Officer or Chief Operating Officer) to cause the Bonus not to be paid to Blake subsequent to the date hereof.

 

4.                                      Equity Awards.  Blake acknowledges and agrees that the Equity Awards are the only equity-based awards received by Blake during her employment with the Company prior to the Effective Date, and that as of the Effective Date she has no other equity or equity-based compensation rights with respect to the Company or any of its subsidiaries or affiliates.  The Equity Awards will continue to vest from the Termination Date through the end of the Consulting Period set forth in paragraph 6 below in accordance with the terms and conditions set forth in the Equity Awards and by the Committee.  Neither the Company nor the Committee shall take any action unique to Blake (that does not apply to the Company’s Chief Executive Officer or Chief Operating Officer) to modify continued vesting of the Equity Awards subsequent to the date hereof.

 

5.                                      Release of Claims.  In exchange for the Company entering into this Agreement and providing the benefits available under this Agreement, Blake agrees to execute the Release of Claims attached to this Agreement as Exhibit A (the “Release”) within the twenty-one (21) day consideration period identified in the Release.  If Blake does not sign the Release within the consideration period, or if Blake signs and then rescinds the Release within the fifteen (15) day rescission period identified in the Release, then notwithstanding any other terms of this Agreement the Consulting Period (defined below) will end effective as of the expiration of the 21-day consideration period (if Blake does not sign the Release before the expiration of that period) or the date on which Blake rescinds the Release (if Blake signs and then rescinds the Release), and Blake will cease to be eligible to receive any of the benefits available under this Agreement after such date.  This Agreement will not be interpreted or construed to limit the Release in any manner.  The existence of any dispute related to the interpretation of this Agreement or the alleged breach of this Agreement will not nullify or otherwise affect the validity or enforceability of the Release.

 

6.                                      Consulting Period.  The Company agrees to engage Blake as a consultant, and Blake agrees to accept such engagement and to be available and to provide services to the Company as a consultant, as set forth in subparagraph 6(b) below, from September 2, 2018, through March 4, 2019, unless earlier terminated in accordance with subparagraph 6(c) below (the “Consulting Period”).

 

(a)                                 Compensation.  As compensation for Blake’s services during the Consulting Period as described in subparagraph 6(b) below, the Company will pay Blake an hourly

 

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consulting fee in the amount of $235.00 (the “Hourly Consulting Fee”), such Hourly Consulting Fee to be paid on or about the fifteenth (15th) of each of the months during the Consulting Period commencing on or about September 15, 2018.  The Company also will reimburse or pay Blake for all reasonable and necessary business expenses incurred by her in providing such consulting services, upon submission of appropriate documentation and provided Blake shall first obtain prior written approval for any expense exceeding $50.00.  The Hourly Consulting Fees and expense reimbursement payments will be payable to Blake as an independent contractor and not as an employee, and Blake will be solely responsible for payment of any and all income, employment or other taxes owing with respect to the Hourly Consulting Fees and expense reimbursement payments received by Blake under this subparagraph 6(a).

 

(b)                                 Services.  During the Consulting Period and in exchange for the Hourly Consulting Fee, upon reasonable notice and request by the Company, Blake will be reasonably available for up to twenty (20) hours per week to consult with, advise and assist the Company with respect to business matters about which Blake had knowledge or responsibility during her employment with the Company, and with respect to such additional projects and matters as may be mutually agreed upon between Blake and the Company’s CEO or Blake’s successor as CFO.  Without limiting the foregoing, at the Company’s reasonable request, Blake will: (i) timely execute and deliver such acknowledgements, instruments, certificates, and other ministerial documents as may be necessary or appropriate to formalize and complete the applicable corporate records; (ii) reasonably consult with the Company regarding business matters that Blake was directly and substantially involved with while employed by the Company; (iii) assist the Company with financial reporting services; and (iv) be reasonably available, with or without subpoena, to be interviewed, review documents or things, give depositions, testify, or engage in other reasonable activities in connection with any litigation or investigation, with respect to matters that Blake has or may have knowledge of by virtue of her employment by or service to the Company or any related entity.  In performing her obligations under this subparagraph 6(b) to testify or otherwise provide information, Blake will honestly, truthfully, forthrightly, and completely provide the information requested.  Blake will comply with this Agreement upon reasonable notice from the Company that the Company or its attorneys believe that her compliance would be helpful in the resolution of an investigation or the prosecution or defense of claims.

 

(c)                                  Early Termination of the Consulting Period.  The Consulting Period may be terminated before March 4, 2019 because of Blake’s death, because Blake terminates the Consulting Period for any reason, provided Blake must provide no less than thirty (30) days written notice to the Company’s CEO of such termination, because the Company terminates the Consulting Period before March 4, 2019 without Cause (as defined below in this subparagraph 6(c)) upon at least thirty (30) days written notice to Blake of such termination, or because the Company terminates the Consulting Period before March 4, 2019 for Cause.  For purposes of this subparagraph 6(c), “Cause” means: (i) an act or acts of dishonesty undertaken by Blake and intended to result in personal gain or enrichment of Blake or others at the expense of the Company; (ii) unlawful conduct or gross misconduct by Blake that, in either event, is injurious to the Company; (iii) the conviction of Blake of a felony; (iv) material breach of any terms or conditions of this Agreement or the Employment Agreement by Blake which breach has not been cured by Blake within 15 days after written notice thereof to Blake from the Company; or (v) Blake failing to execute, or executing and rescinding, the Release within the applicable periods identified in the Release.

 

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(d)                                 Independent Contractor Status. Blake’s relationship to the Company during the Consulting Period shall be that of an independent contractor.  The Company and Blake do not intend that any agency or partnership relationship be created between them by this Agreement.  Blake understands and agrees that she will not be an employee of the Company during the Consulting Period, and that during the Consulting Period Blake will not be eligible for or entitled to any Company employee benefits or benefit plans of any kind, including but not limited to, worker’s compensation insurance, unemployment insurance, health insurance, life insurance, pension plan or any other benefit or insurance that the Company provides to its employees.  Notwithstanding any language in this subparagraph to the contrary, Company acknowledges and agrees that it will fully indemnify Blake to the fullest extent provided under the law (as if she had remained an executive officer of the Company) for any acts or omissions during the Consulting Period, and shall advance any expenses incurred in connection therewith.

 

(e)                                  No Restriction on Acceptance of Other Employment and/or Consulting Contracts.   Nothing in this paragraph 6 is intended to, nor shall be construed to, limit Blake’s ability to accept employment from or to provide consulting services to any third party during the Consulting Period, provided Blake acknowledges and agrees that she may not violate the terms of this Agreement or the Employment Agreement.

 

7.                                      Employment Agreement.  Blake acknowledges entering into the Employment Agreement and hereby reaffirms her commitments and obligations under the Employment Agreement, including all commitments that survive the Termination Date.  Except as otherwise set forth in this Agreement, nothing in this Agreement is intended to modify, amend, cancel or supersede the Employment Agreement in any manner.

 

8.                                      Records, Documents, and Property.  Blake acknowledges and represents that she will deliver to the Company on or before the end of the Consulting Period any and all Company records and any and all Company property in her possession or under her control, including without limitation, manuals, books, blank forms, documents, letters, memoranda, notes, notebooks, reports, printouts, computer disks, computer tapes, data, tables, or calculations and all copies thereof, documents that in whole or in part contain any trade secrets or confidential, proprietary, or other secret information of the Company and all copies thereof, and keys, access cards, access codes, source codes, passwords, credit cards, personal computers, telephones, and other electronic equipment belonging to the Company.  Blake agrees to return to the Company any and all Company property that may be provided to her by the Company during the Consulting Period immediately upon the end of the Consulting Period, or at such earlier time as the Company may request.  Nothing in this paragraph 8 is intended to preclude Blake from keeping documents that are related solely to her compensation, benefits, rights, and other perquisites of being an officer and/or employee of the Company and/or its subsidiaries to the extent that such retention does not violate the Employment Agreement, or from retaining her Company issued phone and laptop during the Consulting Period.

 

9.                                      Taxes.  The Company may take such action as it deems appropriate to ensure that all applicable federal, state, city and other payroll, withholding, income or other taxes arising from any compensation, benefits or any other payments made pursuant to this Agreement, and in order to comply with all applicable federal, state, city and other tax laws or regulations, are withheld or collected from Blake.  This Agreement is intended to satisfy or be exempt from the requirements of Section 409A(a)(2), (3) and (4) of the Internal Revenue Code of 1986, as amended, and the current and future regulations and guidance thereunder.  Blake acknowledges and agrees that the

 

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Company has made no assurances or representations to her regarding the tax treatment of any consideration described in or provided for in this Agreement, and that the Company has advised her to obtain her own personal tax advice.  Except for any tax amounts withheld by the Company from the payments or other consideration hereunder and any employment taxes required to be paid by the Company, Blake shall be responsible for payment of any and all taxes owed in connection with the consideration provided for in this Agreement.

 

10.                               No Admission of Wrongdoing.  Blake and the Company each understand and agree that this Agreement does not constitute an admission that the other has violated any local ordinance, state or federal statute, or principle of common law, that any party has engaged in any unlawful or improper conduct, or that either party has been treated unfairly.  Neither the Company nor Blake will characterize this Agreement as an admission that the other has engaged in any unlawful or improper conduct or treated the other unfairly.

 

11.                               Legal Representation.  Blake acknowledges that she has been advised by the Company to consult with her own attorney before executing this Agreement or the Release.  Blake further acknowledges that she has had a full opportunity to review and ask any questions about this Agreement and the Release before entering into this Agreement, and that she has not relied upon any statements or representations made by the Company or its attorneys, written or oral, other than the statements and representations that are explicitly set forth in this Agreement and the documents referenced herein.

 

12.                               Assignment and Successors.  The rights and obligations of the Company under this Agreement shall inure to the benefit of and shall be binding upon the successors and assigns of the Company.  Blake may not assign this Agreement or any rights or obligations hereunder.  Any purported or attempted assignment or transfer by Blake of this Agreement or any of Blake’s duties, responsibilities, or obligations hereunder shall be void.

 

13.                               Construction and Severability.  The validity, interpretation, performance, and enforcement of this Agreement shall be governed by the laws of the State of Minnesota without regard to conflicts-of-laws provisions that would require application of any other law.  In the event any provision of this Agreement shall be held illegal or invalid for any reason, said illegality or invalidity will not in any way affect the legality or validity of any other provision hereof.

 

14.                               Jurisdiction and Venue.  Blake and the Company consent to jurisdiction of the state and/or federal courts of Minnesota, for the purpose of resolving all issues of law, equity, or fact arising out of or in connection with this Agreement.  Any action involving claims of a breach of this Agreement shall be brought solely in such courts.  Each party consents to personal jurisdiction over such party in the state and/or federal courts of Minnesota and hereby waives any defense of lack of personal jurisdiction.

 

15.                               Entire Agreement.  This Agreement sets forth the entire agreement between the Company and Blake with respect to her employment by the Company, the termination of such employment, and the Consulting Period, and there are no undertakings, covenants, or commitments between the Company and Blake other than as set forth in this Agreement, the Release, and the Employment Agreement and any qualified employee benefit plans sponsored by the Company in which Blake is a participant; provided, however, that nothing in this Agreement is intended to supersede, replace or modify the terms of the Company’s 2016 Equity Incentive Plan or any equity award agreements issued to Blake under the Company’s 2016 Equity Incentive Plan, each of which shall remain in full force and effect in accordance with their terms, and as

 

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provided herein shall continue to vest during the Consulting Period.  This Agreement may not be altered or amended, except by a writing executed by the party against whom such alteration or amendment is to be enforced.

 

16                                  Counterparts.  This Agreement may be simultaneously executed by electronic signature and in any number of counterparts, and such counterparts executed and delivered, each as an original, shall constitute but one and the same instrument.

 

17.                               Captions and Headings.  The captions and paragraph headings used in this Agreement are for convenience of reference only, and shall not affect the construction or interpretation of this Agreement or any of the provisions hereof.

 

18.                               Survival.  The parties expressly acknowledge and agree that the provisions of this Agreement which by their express or implied terms extend beyond the termination of Blake’s engagement hereunder shall continue in full force and effect, notwithstanding the conclusion of the Consulting Period.  In addition, the representations and warranties contained herein shall survive the execution and delivery hereof and the consummation of the transactions contemplated hereby.

 

19.                               Waivers.  No failure on the part of either party to exercise, and no delay in exercising, any right or remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof, or the exercise of any other right or remedy granted hereby or by any related document or by law.  No single or partial waiver of rights or remedies hereunder, nor any course of conduct of the parties, shall be construed as a waiver of rights or remedies by either party (other than as expressly and specifically waived).  Any waiver of rights or obligations hereunder shall be in writing signed by the waiving party.

 

[signature page follows]

 

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IN WITNESS WHEREOF, the parties have signed this Agreement as of the Effective Date.

 

	
TACTILE SYSTEMS   TECHNOLOGY, INC.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Gerald R. Mattys
    	
 
    	
/s/ Lynn Blake
    
	
 
    	
Gerald R. Mattys 
    	
 
    	
LYNN BLAKE
    
	
 
    	
Chief Executive Officer
    	
 
    	
 
    

 

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EXHIBIT A

 

RELEASE OF CLAIMS

 

I.                                        Background.

 

A.                                    I, Lynn Blake, was employed by Tactile (as defined below).

 

B.                                    My employment with Tactile ended effective September 1, 2018 (the “Termination Date”).

 

C.                                    It is my desire to resolve all issues or claims I may have against the Company (as defined below), and I have agreed to a full settlement of all such issues and claims.

 

II.                                   Definitions.  I intend all words used in this Release of Claims (the “Release”) to have their plain meanings in ordinary English.  Specific terms I use in this Release have the following meanings:

 

A.                                    I, me, and my mean both me (Lynn Blake) and anyone who has or obtains any legal rights or claims through me.

 

B.                                    Tactile means Tactile Systems Technology, Inc., and any other company related to Tactile Systems Technology, Inc. in the present or past, including without limitation its predecessors, successors, parents, subsidiaries, affiliates, joint venture partners, and divisions.

 

C.                                    Company means Tactile; the present and past officers, directors, committees, employees, and insurers of Tactile; the present and past employee benefit plans sponsored or maintained by Tactile (other than multiemployer plans) and the present and past fiduciaries of such plans; and anyone who acted on behalf of Tactile or on instructions from Tactile.

 

D.                                    Separation and Consulting Agreement means the Separation and Consulting Agreement entered into by and between me and Tactile as of August 1, 2018.

 

E.                                     Consideration means the consideration identified in the Separation and Consulting Agreement, including the consideration I’m eligible to receive during the Consulting Period (as defined in the Separation and Consulting Agreement).

 

F.                                      My Claims means all of my rights that I now have to any relief of any kind from the Company, including without limitation:

 

1.                                      all claims arising out of or relating to my employment with Tactile or the termination of that employment;

 

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2.                                      all claims arising out of or relating to the statements, actions, or omissions of the Company;

 

3.                                      all claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful practices arising under any federal, state, or local statute, ordinance, or regulation, including without limitation claims under Title VII of the Civil Rights Act of 1964; the Age Discrimination in Employment Act; the Americans with Disabilities Act; 42 U.S.C. §1981; the Employee Retirement Income Security Act; the Equal Pay Act; the Family and Medical Leave Act; the Worker Adjustment and Retraining Notification Act; the Fair Credit Reporting Act; the Equal Pay Act; the Lilly Ledbetter Fair Pay Act of 2009; the Genetic Information Nondiscrimination Act; the Minnesota Human Rights Act; and workers’ compensation non-interference or non-retaliation statutes (such as Minn. Stat. § 176.82);

 

4.                                      all claims for alleged wrongful discharge; breach of contract; breach of implied contract; failure to keep any promise; breach of a covenant of good faith and fair dealing; breach of fiduciary duty; estoppel; my activities, if any, as a “whistleblower”; defamation; infliction of emotional distress; fraud; misrepresentation; negligence; harassment; retaliation or reprisal; constructive discharge; assault; battery; false imprisonment; invasion of privacy; interference with contractual or business relationships; any other wrongful employment practices; and violation of any other principle of common law;

 

5.                                      all claims for compensation of any kind, including without limitation, salary, bonuses, paid time off, severance pay, and expense reimbursements;

 

6.                                      all claims for reinstatement, back pay, front pay, compensatory damages, damages for alleged personal injury, liquidated damages, and punitive damages;

 

7.                                      all claims that a past unlawful decision has or has had a continuing effect on my compensation; and

 

8.                                      all claims for attorneys’ fees, costs, and interest.

 

However, My Claims do not include (i) any claims that the law does not allow to be waived, (ii) any claims that may arise after the date on which I sign this Release, (iii) my rights under the Separation and Consulting Agreement, (iv) my rights to all equity-based incentive awards received from Company during my employment (“Equity Awards”), (v) my right to file a claim against Tactile with the U.S. Equal Employment Opportunity Commission or any comparable state or local agency or participating in any such agency’s investigation of Tactile;

 

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provided, however My Claims do include, to the fullest extent legally permissible, any right or entitlement to any form of personal relief for me arising from any claim that I or others may file with the U.S. Equal Employment Opportunity Commission or any comparable state or local agency, or (vi) my right to participate in any government agency led investigation or legal proceeding against the Company; provided, however, My Claims do include, to the fullest extent legally permissible, (I) any right or entitlement to any form of personal relief for me arising from any such claim, (II) my right to receive my final wages for my last payroll period including the Termination Date, and (III) my right to receive payment for my accrued and unused vacation leave as of the Termination Date.

 

III.                              Agreements and Representations.

 

A.                                    Agreement to Release My Claims.  In exchange for me signing and not rescinding this Release as provided below, and me otherwise complying with my obligations under this Release, I will receive the Consideration.  I understand and acknowledge that the Consideration is in addition to anything of value that I would be entitled to receive from Tactile if I did not sign this Release or if I rescinded this Release.  In exchange for the Consideration I give up and release all of My Claims.  I will not make any demands or claims against the Company for compensation or damages relating to My Claims.  The Consideration I am receiving is a fair compromise for the release of My Claims.

 

B.                                    Additional Agreements and Understandings.  Even though Tactile will provide the Consideration for me to settle and release My Claims and in exchange for the other consideration I am providing as described in this Release, the Company does not admit that it is responsible or legally obligated to me.  In fact, the Company denies that it is responsible or legally obligated to me for My Claims, denies that it engaged in any unlawful or improper conduct toward me, and denies that it treated me unfairly.

 

C.                                    Advice to Consult with an Attorney.  I understand and acknowledge that I am hereby being advised by Tactile to consult with an attorney prior to signing this Release. My decision whether to sign this Release is my own voluntary decision made with full knowledge that Tactile has advised me to consult with an attorney.

 

D.                                    Period to Consider this Release.  I understand that I have 21 (twenty-one) calendar days from my Termination Date, not counting my Termination Date, to consider whether I wish to sign this Release.  If I sign this Release before the end of the 21-day period, it will be my voluntary decision to do so because I have decided that I do not need any additional time to decide whether to sign this Release.   I also agree that any changes made to this Release before I sign it, whether material or immaterial, will not restart the 21-day period.

 

E.                                     My Right to Rescind this Release.  I understand that I have the right to rescind (that is, cancel or revoke) this Release for any reason within 15 (fifteen) calendar

 

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days after I sign it, not counting the day upon which I sign it.  I understand this Release will not become effective or enforceable, and that I will not be entitled to receive the Consideration, unless and until the rescission period has expired without my having rescinded it.

 

F.                                      Procedure for Accepting or Rescinding this Release.  To accept the terms of this Release, I must deliver this Release, after I have signed and dated it, to Tactile by hand or by mail before the end of the 21-day consideration period.  To rescind my acceptance, I must deliver a written, signed statement that I rescind my acceptance to Tactile by hand or by mail within the 15-day rescission period. All deliveries must be made to Tactile at the following address:

 

Tactile Systems Technology, Inc.

Attn: Chief Executive Officer

1331 Tyler Street N.E., Suite 200
 Minneapolis, MN 55413

 

If I choose to deliver my acceptance or the rescission of my acceptance by mail, it must be:

 

(a)                                 postmarked within the period stated above; and

(b)                                 properly addressed to Tactile at the address stated above.

 

In addition, any rescission of my acceptance by mail must be sent by certified mail, return receipt requested.

 

G.                                    Entire Agreement.  I understand and agree that this Release, the Separation and Consulting Agreement, all documents relating to my Equity Awards and any other agreements identified in the Separation and Consulting Agreement contain all the agreements and understandings between and among the Company and me, and I have no other written or oral agreements with the Company that survive the termination of my employment with Tactile.

 

H.                                   Choice of Law and Venue.  This Release shall be interpreted and construed in accordance with the laws of Minnesota (without regard to conflict of laws principles).  Any legal action related to or arising out of this Release shall be commenced exclusively in a state or federal court located in Hennepin County, Minnesota.  I hereby consent to jurisdiction in the state or federal courts located in Hennepin County, Minnesota and waive any defense based on lack of jurisdiction or inconvenient forum.

 

I.                                        Interpretation of this Release.  This Release should be interpreted as broadly as possible to achieve the parties’ intention that I am resolving all of My Claims against the Company.  If this Release is held by a court to be inadequate to release a particular claim encompassed within My Claims, this Release will remain in full force and effect with respect to all the rest of My Claims.

 

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J.                                        My Representations.  I am not under any legal disabilities that prevent me from being legally bound by the agreements that I am making in this Release.  I am legally able and entitled to receive the consideration being provided to me in settlement of My Claims.

 

I also represent and confirm that I have received from the Company all compensation and benefits earned by and owed to me in connection with my employment with Tactile except for my right to receive my final wages for my last payroll period including the Termination Date, and my right to receive payment for my accrued and unused vacation leave as of the Termination Date,, and that the only additional amount of money I am entitled to receive from the Company is the Consideration, which I acknowledge and agree is contingent on me satisfying all of the conditions identified in this Release.

 

I have read this Release carefully.  I understand all of its terms.  In signing this Release, I have not relied on any statement or explanations made by the Company except as specifically set forth in this Release.  I am voluntarily releasing My Claims against the Company. I intend this Release to be legally binding.

 

	
Dated:                ,   2018
    	
 
    
	
 
    	
Lynn   Blake
    
	
 
    	
 
    
	
Dated:                 ,   2018
    	
TACTILE   SYSTEMS TECHNOLOGY, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Gerald   R. Mattys
    
	
 
    	
 
    	
Chief   Executive Officer
    

 

12ex_120442.htm

Exhibit 10.1

 

 

 TWIN DISC, INCORPORATED

 

2018 LONG-TERM INCENTIVE COMPENSATION PLAN

 

ARTICLE I

 

PURPOSE

 

1.1     Purpose. The purpose of the Twin Disc, Incorporated 2018 Long-Term Incentive Compensation Plan (the "Plan") is to promote the overall financial objectives of Twin Disc, Incorporated (the "Company") and its majority owned subsidiaries ("Subsidiaries") by providing opportunities for the officers and key employees selected to participate in the Plan (each a “Participant”) to acquire Common Stock of the Company ("Common Stock"), and to receive Common Stock or cash bonuses upon attainment of specified financial goals of the Company or its Subsidiaries. The Plan gives the Compensation and Executive Development Committee of the Company's Board of Directors, or such other committee as the Board of Directors shall designate (the "Committee"), the authority and discretion to award stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, cash-settled restricted stock unit awards, performance stock awards, performance stock unit awards, performance unit awards and/or dividend equivalent awards (collectively, "Awards") to eligible employees of the Company.

 

ARTICLE II

 

EFFECTIVE DATE AND TERM

 

2.1     Effective Date. The Plan shall become effective on the date that it is approved by the Company’s Board of Directors (the “Effective Date”), provided that shareholders of the Company’s Common Stock approve the Plan by a majority of votes cast at a meeting of such shareholders before the first anniversary of the Effective Date. No shares shall be issued under the Plan prior to such shareholder approval. Notwithstanding any terms of the Plan to the contrary:

 

	 	
			(a)

				
			Options issued under the Plan prior to such shareholder approval shall not be exercisable unless and until such shareholder approval occurs;

			

 

	 	
			(b)

				
			SARs issued under the Plan that would be settled in shares of Common Stock shall not be exercisable unless and until such shareholder approval occurs;

			

 

	 	
			(c)

				
			If an event occurs prior to such shareholder approval that would otherwise result in issuance of shares prior to such shareholder approval (including, for example, termination of a Participant’s employment due to death or disability), such shares shall not be issued unless and until such shareholder approval occurs; and such shares shall be issued no later than 2 1⁄2 months after the date of such shareholder approval occurs (or, if later, the first day of the seventh month following the Participant’s termination of employment for reasons other than death). If the shareholders do not approve the Plan before the first anniversary of the Effective Date, any Awards made under the Plan shall be null and void.

			

 

 

 

 

2.2     Term. No Award may be granted more than ten years after the Effective Date.

 

2.3     Post-Term Activity. Awards granted within the term of the Plan as set forth in Section 2.2, subject to the all other terms and conditions of the Plan and the agreement(s) governing the grant of the Awards, may be exercised, paid out, or modified more than ten years after the adoption of the Plan. Restrictions on Restricted Stock, Restricted Stock Units, and Cash-Settled Restricted Stock Units may lapse more than ten (10) years after the Effective Date.

 

ARTICLE III

 

STOCK SUBJECT TO PLAN

 

3.1     Maximum Number. The maximum number of shares of Common Stock that may be issued pursuant to Awards under the Plan from and after the Effective Date is 850,000, subject to the adjustments provided in Article XI, below. Such shares may be newly-issued shares, authorized but unissued shares or shares reacquired by the Company on the open market or otherwise. Because Cash-Settled Restricted Stock Units and Performance Stock Units are payable only in cash, the number of such Cash-Settled Restricted Stock Units and Performance Stock Units shall not count against the 850,000 maximum described in this paragraph.

 

3.2     Availability of Shares for Award. Shares of Common Stock that are subject to issuance pursuant to an Award may thereafter be subject to a new Award:

 

	 	
			(a)

				
			if the prior Award to which such shares were subject lapses, expires or terminates without the issuance of such shares; or

			

 

	 	
			(b)

				
			shares issued pursuant to an Award are reacquired by the Company pursuant to rights reserved by the Company upon the issuance of such shares; provided, that shares reacquired by the Company may only be subject to new Awards if the Participant received no benefit of ownership from the shares.

			

 

Notwithstanding the foregoing, shares of Common Stock that are received by the Company in connection with the exercise of an Award, including shares tendered in payment of a Stock Option’s or an SAR’s exercise price or shares tendered to the Company for the satisfaction of any tax liability or the satisfaction of a tax withholding obligation, may not be made subject to issuance pursuant to a later Award. In the event that only net shares are issued upon exercise of a Stock Option, upon the exercise of a SAR settled in shares of Common Stock, or upon the issuance of shares of Common Stock following the lapse of restrictions on Restricted Stock Units or the satisfaction of performance goals with respect to Performance Stock, the gross number of shares associated with such Award shall be counted against the 850,000 maximum described in Section 3.1. In no event will shares that are repurchased on the open market using stock option exercise proceeds be added back to the Plan.

 

 

 

 

ARTICLE IV

 

ADMINISTRATION

 

4.1     General Administration. The Committee shall supervise and administer the Plan. The Committee shall have discretionary authority to determine all issues with respect to the interpretation of the Plan and Awards granted under the Plan, and with respect to all Plan administration issues.

 

4.2     Powers of the Committee. Subject to the terms of the Plan and applicable law (including but not limited to the Sarbanes-Oxley Act of 2002, as amended), the Committee shall have the authority, in its discretion: (i) to prescribe, amend and rescind rules and regulations relating to the Plan; (ii) to select the eligible employees who shall receive Awards under the Plan; (iii) to grant Awards under the Plan and to determine the terms and conditions of such Awards, including without limitation the authority to determine the number of shares subject to issuance with respect to any Award, the vesting or exercise schedule of any Award, and the specific performance goals that shall cause an Award to vest or become payable; (iv) to determine the terms and conditions of the respective agreements (which need not be identical) pursuant to which Awards are granted, and (with the consent of the holder thereof) to modify or amend any Award; (v) to authorize any person to execute on behalf of the Company any instrument required to effectuate the grant of any Award; (vi) to determine the exercise price per share of options granted under the Plan; (vii) to determine the permissible methods of Award exercise and payment, including cashless exercise arrangements; (viii) to decide whether a Stock Appreciation Right Award shall be settled in cash or Common Stock; (ix) to determine the remaining number of shares of Common Stock available for issuance under the Plan; (x) to appoint and compensate agents, counsel, auditors or other specialists to aid it in the discharge of its duties; (xi) to interpret the Plan and/or any agreement entered into under the Plan; and (xii) to make all other determinations necessary or advisable for the administration of the Plan.

 

4.3     Committee. The Committee shall consist of at least three directors, each of whom shall be a "non-employee director" as that term is defined in Rule 16b-3(b)(3) promulgated by the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934 (the "Exchange Act"). A majority of the members of the Committee shall constitute a quorum at any meeting thereof (including telephone conference), and all determinations of the Committee shall be made by a majority of the members present, or by a writing by a majority of the members of the entire Committee without notice or meeting.

 

4.4     Minimum Vesting. Notwithstanding any other provision of the Plan to the contrary, and subject to acceleration as described in Sections 8.1, 8.2, and 9.1, no Awards granted under the Plan shall have a vesting, restricted or performance period (as applicable) of less than one year from the date of grant; provided, however, that Awards that result in the issuance of an aggregate of five percent (5%) of the shares of Common Stock available pursuant to Section 3.1 may be granted to any one or more Participants without regard to such minimum vesting, restricted or performance provisions.

 

 

 

 

4.5     Compliance with Code Section 409A. All Awards under this Plan shall be structured in a manner to comply with the requirements of Code Section 409A, or to be exempt from the application of Code Section 409A.

 

ARTICLE V

 

ELIGIBILITY

 

5.1     Eligibility. An Award may be granted under the Plan to those key employees (including officers) of the Company or its present or future Subsidiaries who, in the opinion of the Committee, are mainly responsible for the success and future growth of the Company and/or any of its Subsidiaries.

 

ARTICLE VI

 

AWARDS

 

6.1     Types of Awards. Awards under the Plan may be granted in any one or a combination of the following:

 

(a)     Stock Options. An Option shall entitle the Participant to receive shares of Common Stock upon exercise of such Option, subject to the Participant's satisfaction in full of any conditions, restrictions or limitations imposed in accordance with the Plan or the agreement between the Company and the Participant governing the award of such Option. The agreement governing the award of an option shall designate whether such option is intended to be an incentive stock option or a non-qualified stock option, and to the extent that any stock option is not designated as an incentive stock option (or even if so designated does not qualify as an incentive stock option), it shall constitute a non-qualified stock option. The maximum number of Options that may be granted to any Participant during any fiscal year of the Company is 100,000, subject to the adjustments provided in Article XI, below.

 

(i)     Exercise Price. The exercise price per share of the Common Stock purchasable under an Option shall be determined by the Committee, but shall not be less than the fair market value per share of Common Stock on the date the option is granted (or, if the Option is intended to qualify as an incentive stock option, not less than 110% of the such fair market value if the option is granted to an individual who owns or is deemed to own stock possessing more than 10% of the combined voting power of all classes of stock or the Company, a corporation which is the parent of the Company or and subsidiary of the Company (each as defined in Section 424 of the Code) (a "10% Shareholder")). For this and all other purposes under the Plan, the fair market value shall be the mean between the highest and lowest quoted selling prices per share of Common Stock on the NASDAQ Stock Market on the date of grant; provided, that if the Common Stock ceases to be listed on the NASDAQ Stock Market, the Committee shall designate an alternative method of determining the fair market value of the Common Stock.

 

 

 

 

(ii)     Option Period. An Option shall be exercisable at such time and subject to such terms and conditions as shall be determined by the Committee. An option that is intended to qualify as an incentive stock option shall not be exercisable more than ten years after the date it is granted (or five years after the date it is granted, if granted to a 10% Shareholder).

 

(iii)     No Repricings or Repurchases of Underwater Options Permitted. Except in connection with a transaction or event described in Article XI, the terms of outstanding Options may not be amended to reduce the exercise price of the outstanding Options or cancel the outstanding Options in exchange for cash, other awards or Options or SARs with an exercise price that is less than the exercise price of the original Options without stockholder approval.

 

(b)     Stock Appreciation Rights. A Stock Appreciation Right shall entitle the Participant to surrender to the Company the Stock Appreciation Right and to be paid therefor the amount described in Section 6.1(b)(i)(3) or 6.1(b)(ii) below, subject to the Participant's satisfaction in full of any conditions, restrictions or limitations imposed in accordance with the Plan or the agreement between the Company and the Participant governing the award of such Stock Appreciation Right. Stock Appreciation Rights may be granted in conjunction with all or part of any Stock Option under this Plan ("Tandem SAR's"), or may be granted on a stand-alone basis ("Stand Alone SAR's"). The maximum number of Stock Appreciation Rights that may be granted to any Participant during any fiscal year of the Company is 100,000, subject to the adjustments provided in Article XI, below.

 

(i)     Tandem SAR's.

 

(1)     Grant. Tandem SAR's may be granted in connection with non-qualified or incentive stock options, but may only be granted at the time of grant of such associated Options.

 

(2)     Term. A Tandem SAR shall have the same term as the Stock Option to which it relates and shall be exercisable only at such time or times and to the extent the related Stock Option would be exercisable.

 

 

 

 

(3)     Exercise. Upon the exercise of a Tandem SAR, the Participant shall be entitled to receive an amount in cash equal in value to the excess of the fair market value per share of Common Stock on the date of exercise over the exercise price per share of Common Stock as specified in the agreement governing the Tandem SAR, multiplied by the number of shares in respect to which the Tandem SAR is exercised. The exercise of Tandem SAR's shall require the cancellation of a corresponding number of Stock Options to which the Tandem SAR's relate, and the exercise of Stock Options shall require the cancellation of a corresponding number of Tandem SAR's to which the Stock Options relate.

 

(4)     Expiration or Termination. A Tandem SAR shall expire or terminate at such time as the Stock Option to which it relates expires or terminates, unless otherwise provided in the agreement governing the grant of the Tandem SAR.

 

(ii)     Stand Alone SAR's. A Stand Alone SAR may be granted at such time and for such term as the Committee shall determine, and shall be exercisable at such time as specified in the agreement governing the grant of the Stand Alone SAR. Upon exercise of a Stand Alone SAR, the Participant shall be entitled to receive, in cash, Common Stock, or a combination of both (as determined by the Committee), an amount equal to the fair market value per share of Common Stock over an exercise price specified in the agreement governing the grant of the Stand Alone SAR (which exercise price shall not be less than the fair market value per share of Common Stock on the date the Stand Alone SAR is awarded), multiplied by the number of shares in respect to which the Stand Alone SAR is exercised.

 

(iii)     No Repricings or Repurchases of Underwater SARs Permitted. Except in connection with a transaction or event described in Article XI, the terms of outstanding SARs may not be amended to reduce the exercise price of the outstanding SARs or cancel the outstanding SARs in exchange for cash, other awards or Options or SARs with an exercise price that is less than the exercise price of the original SARs without stockholder approval.

 

(c)     Restricted Stock Awards. Restricted Stock consists of shares of Common Stock that are transferred or sold to the Participant, but which carry restrictions such as a prohibition against disposition or an option to repurchase in the event of employment termination. The minimum restriction on shares of Restricted Stock shall be one year of continued service by the Participant, although the Committee may impose longer service requirements and/or additional restrictions. Until such restrictions lapse, the Participant may not sell, assign, pledge or otherwise transfer, whether voluntarily or involuntarily, the Restricted Stock. A sale of Restricted Stock to a Participant shall be at such price as the Committee determines, which price may be substantially below the fair market value of the Common Stock at the date of grant.

 

 

 

 

(i)     Lapse of Restrictions. The Committee shall establish the conditions under which the restrictions applicable to shares of Restricted Stock shall lapse. Lapse of the restrictions may be conditioned upon continued employment of the Participant for a specified period of time, satisfaction of performance goals of the Company or a Subsidiary, or any other factors as the Committee deems appropriate.

 

(ii)     Rights of Holder of Restricted Stock. Except for the restrictions on transfer and/or the Company's option to repurchase the Restricted Shares, the Participant shall have, with respect to shares of Restricted Stock, all of the rights of a shareholder of Common Stock, including, if applicable, the right to vote the shares and the right to receive any cash or stock dividends. Notwithstanding the foregoing, cash or stock dividends on shares of Restricted Stock shall be automatically deferred, and shall be paid to the Participant only if, when and to the extent the underlying shares of Restricted Stock vest. Cash or stock dividends payable with respect to shares of Restricted Stock that are forfeited shall also be forfeited. Cash or stock dividends payable under this paragraph shall be paid as soon as practicable after the restrictions on the shares of Restricted Stock to which such dividends relate lapse (but no later than the 15th day of the third month of calendar year after the calendar year in which such restrictions lapse). Cash dividends shall be paid with an appropriate rate of interest, as determined by the Committee. The Committee shall not have the discretion to override the provisions of this Section 6.1(c)(ii).

 

(iii)     Certificates. The Company may require that the certificates evidencing shares of Restricted Stock be held by the Company until the restrictions thereon have lapsed. If and when such restrictions lapse, certificates for such shares shall be delivered to the Participant. Such shares may have further restrictions on transfer if they have not been registered under the Exchange Act, but shall no longer be subject to a substantial risk of forfeiture.

 

(d)     Restricted Stock Unit Awards. Restricted Stock Units consist of the right to receive a specified number of shares of Common Stock upon the lapse of a substantial risk of forfeiture. The minimum restriction on Restricted Stock Units shall be one year of continued service by the Participant, although the Committee may impose longer service requirements and/or additional restrictions. There is no purchase or exercise price associated with Restricted Stock Units or with the shares issued in settlement of the award. Participants have no voting rights or rights to receive cash dividends with respect to Restricted Stock Units until shares of Common Stock are issued in settlement of such awards. However, the Committee may grant restricted stock units that entitle the holders to receive Dividend Equivalent Awards, as described in Section 6.1(i) below.

 

 

 

 

(i)     Lapse of Restrictions. The Committee shall establish the conditions under which the restrictions applicable to Restricted Stock Units shall lapse. Lapse of the restrictions may be conditioned upon continued employment of the Participant for a specified period of time, satisfaction of performance goals of the Company or a Subsidiary, or any other factors as the Committee deems appropriate.

 

(ii)     Timing of Payments. Shares of Common Stock due under Restricted Stock Units shall be issued as soon as practicable after the applicable restrictions lapse, but no later than the 15th day of the third month of the calendar year after the calendar year in which such restrictions lapse. Such shares may have further restrictions on transfer if they have not been registered under the Exchange Act, but shall no longer be subject to a substantial risk of forfeiture.

 

(e)     Cash-Settled Restricted Stock Unit Awards. Cash-Settled Restricted Stock Units consist of the right to receive a cash payment upon the lapse of a substantial risk of forfeiture. The minimum restriction on Cash-Settled Restricted Stock Units shall be one year of continued service by the Participant, although the Committee may impose longer service requirements and/or additional restrictions. The cash payment for each Cash-Settled Restricted Stock Unit that vests upon the lapse of the substantial risk of forfeiture shall be equal to the fair market value of a share of Common Stock as of the date the substantial risk of forfeiture lapses.

 

(i)     Lapse of Restrictions. The Committee shall establish the conditions under which the restrictions applicable to Cash-Settled Restricted Stock Units shall lapse. Lapse of the restrictions may be conditioned upon continued employment of the Participant for a specified period of time, satisfaction of performance goals of the Company or a Subsidiary, or any other factors as the Committee deems appropriate.

 

(ii)     Timing of Payments. Payments of amounts due under Cash-Settled Restricted Stock Units shall be made as soon as practicable after the applicable restrictions lapse, but no later than the 15th day of the third month of the calendar year after the calendar year in which such restrictions lapse.

 

(f)     Performance Stock Awards. Performance Stock Awards are artificial shares that are contingently granted to a Participant, which entitle the Participant to actual shares of Common Stock, if predetermined objectives are met. Because the payment of a Performance Stock Award is based on a predetermined number of shares of Common Stock, the value of the award may increase or decrease depending on the fair market value of the Common Stock after the date of grant. The maximum number of shares of Performance Stock that may be granted to any Participant during any fiscal year of the Company is 100,000, subject to the adjustments provided in Article XI, below.

 

 

 

 

(i)     Performance Goals. The Committee shall establish one or more performance goals with respect to each grant of a Performance Stock Award. The performance goals may be tailored to meet specific objectives. Payment or vesting a Performance Stock Award may be based upon one or more of the following criteria, as determined by the Committee, or upon such other business criteria as the Committee shall determine in its sole discretion: gross revenues, sales, net asset turnover, earnings per share, cash flow, cash flow from operations, return on investment in excess of cost of capital (i.e., net operating profit after taxes minus the Company’s capital charge), net operating profit after taxes as a percentage of the Company’s capital charge, operating profit or income, EBITDA as a percent of sales, debt to EBITDA ratios (including but not limited to the ratio of total funded debt to four quarter EBITDA, as defined in loan covenants of the Company), net income, operating income, net income margin, return on net assets, return on total sales, return on common equity, return on total capital, or total shareholder return. The Committee may establish targets under one or more of the foregoing performance goals based on single year or multi year periods. In addition, performance goals may relate to attainment of specified objectives by the Participant or by the Company or an affiliate, including a division or a department of the Company or an affiliate, or upon any other factors or criteria as the Committee shall determine.

 

(ii)     Certification of Satisfaction of Performance Goals. Following the completion of a period for which performance goals have been established, the Committee shall certify the extent to which such goals have been achieved. Such certification shall occur, and any applicable transfer of shares of Common Stock shall be made, as soon as practicable following the completion of the performance period, but no later than the 15th day of the third month of the calendar year after the calendar year in which such period ends.

 

(g)     Performance Stock Unit Awards. A Performance Stock Unit shall entitle the Participant to receive a cash payment equal to the fair market value of a share of Common Stock of the Company as of the Vesting Date, if predetermined objectives are met. The “Vesting Date” shall be the last day of the performance period for which a performance goal is established. The maximum number of Performance Stock Units that may be granted to any Participant during any fiscal year of the Company is 200,000, subject to the adjustments provided in Article XI, below.

 

 

 

 

(i)     Performance Goals. The Committee shall establish one or more performance goals with respect to each grant of a Performance Stock Unit. The performance goals may be tailored to meet specific objectives. Payment or vesting a Performance Stock Unit Award may be based upon one or more of the following criteria, as determined by the Committee, or upon such other business criteria as the Committee shall determine in its sole discretion: gross revenues, sales, net asset turnover, earnings per share, cash flow, cash flow from operations, return on investment in excess of cost of capital (i.e., net operating profit after taxes minus the Company’s capital charge), net operating profit after taxes as a percentage of the Company’s capital charge, operating profit or income, EBITDA as a percent of sales, debt to EBITDA ratios (including but not limited to the ratio of total funded debt to four quarter EBITDA, as defined in loan covenants of the Company), net income, operating income, net income margin, return on net assets, return on total sales, return on common equity, return on total capital, or total shareholder return. The Committee may establish targets under one or more of the foregoing performance goals based on single year or multi year periods In addition, performance goals may relate to attainment of specified objectives by the Participant or by the Company or an affiliate, including a division or a department of the Company or an affiliate, or upon any other factors or criteria as the Committee shall determine.

 

(ii)     Certification of Satisfaction of Performance Goals. Following the completion of a period for which performance goals have been established, the Committee shall certify the extent to which such goals have been achieved. Such certification shall occur, and any applicable payments shall be made, as soon as practicable following the completion of the performance period, but no later than the 15th day of the third month of the calendar year after the calendar year in which such period ends.

 

(h)     Performance Unit Awards. Performance Unit Awards entitle the participant to cash payments (or, at the election of the Committee, their equivalent in shares of Common Stock), if predetermined objectives are met. Because the payment of a Performance Unit Award is based on a predetermined cash amount, the value of each unit remains constant and does not fluctuate with changes in the market value of the Common Stock. The maximum amount that may be paid to any Participant in any fiscal year of the Company pursuant to an award of Performance Units shall be $500,000.00.

 

(i)     Performance Goals. The Committee shall establish one or more performance goals with respect to each grant of a Performance Unit Award. The performance goals may be tailored to meet specific objectives. Payment or vesting a Performance Unit Award may be based upon one or more of the following criteria, as determined by the Committee, or upon such other business criteria as the Committee shall determine in its sole discretion: gross revenues, sales, net asset turnover, earnings per share, cash flow, cash flow from operations, return on investment in excess of cost of capital (i.e., net operating profit after taxes minus the Company’s capital charge), net operating profit after taxes as a percentage of the Company’s capital charge, operating profit or income, EBITDA as a percent of sales, debt to EBITDA ratios (including but not limited to the ratio of total funded debt to four quarter EBITDA, as defined in loan covenants of the Company), net income, operating income, net income margin, return on net assets, return on total sales, return on common equity, return on total capital, or total shareholder return. The Committee may establish targets under one or more of the foregoing performance goals based on single year or multi year periods. In addition, performance goals may relate to attainment of specified objectives by the participant or by the Company or an affiliate, including a division or a department of the Company or an affiliate, or upon any other factors or criteria as the Committee shall determine.

 

 

 

 

(ii)     Certification of Satisfaction of Performance Goals. Following the completion of a period for which performance goals have been established, the Committee shall certify the extent to which such goals have been achieved. Such certification shall occur, and any applicable payments shall be made, as soon as practicable following the completion of the performance period, but no later than the 15th day of the third month of the calendar year after the calendar year in which such period ends.

 

(i)     Dividend Equivalent Awards. Dividend Equivalent Awards entitle the Participant to receive payment having a value equal to the dividends that would be payable with respect to a specified number of shares of Common Stock during a specified period, if the Participant owned that number of shares of Common Stock. Dividend Equivalent Awards may be granted on a free-standing basis or in connection with another Award, except that Dividend Equivalent Awards may not be granted with respect to Options or SARs. Any Dividend Equivalent Awards relating to an underlying Award shall be paid only if, when and to the extent such underlying Award vests, and the value of a Dividend Equivalent Award payable with respect to an underlying Award that does not vest shall be forfeited. Payments of amounts due under a stand-alone Dividend Equivalent Award shall be made as soon as practicable after the applicable restrictions lapse or the vesting conditions are satisfied, but no later than the 15th day of the third month of the calendar year after the calendar year in which such restrictions lapse or such vesting conditions are satisfied.

 

 

 

 

6.2     Written Agreements. Each Award granted under the Plan shall be evidenced by a written agreement, the form of which shall be consistent with the terms and conditions of the Plan and applicable law, which shall be signed by an officer of the Company and the Participant. Until such agreement has been entered into between the Company and the Participant, the Participant shall have no rights in any Award approved by the Committee.

 

ARTICLE VII

 

PAYMENT FOR AWARDS

 

7.1     General. Payments required, if any, upon a Participant's exercise of an Award under the Plan may be made in the form of: (i) cash; (ii) Company stock; (iii) a combination of cash and Company stock; or (iv) such other forms or means that the Committee shall determine in its discretion and in such manner as is consistent with the Plan's purpose and the Code, the Exchange Act, or other applicable laws or regulations.

 

ARTICLE VIII

 

EFFECT OF TERMINATION OF EMPLOYMENT ON BENEFITS

 

8.1     Termination by Reason of Death. Unless otherwise provided in an agreement governing the grant of an Award or as determined by the Committee, if a Participant incurs termination of employment due to death:

 

(a)     Any unexpired and unexercised Options and/or Stock Appreciation Rights held by such Participant shall thereafter be fully exercisable (whether or not such Options or Stock Appreciation Rights were fully vested at the time of the Participant's death) by the deceased Participant’s estate or by a person who acquired the right to exercise the Option or Stock Appreciation Right by bequest or inheritance for a period of one year immediately following the date of death, or until the expiration of the Option or Stock Appreciation Right if shorter.

 

(b)     Any restrictions on shares of Restricted Stock shall lapse and the Participant’s designated beneficiary (or in the absence of such beneficiary, the Participant’s estate) shall be fully vested in the Restricted Stock.

 

(c)     Any restrictions on Restricted Stock Units shall lapse, and the Participant’s designated beneficiary (or in the absence of such beneficiary, the Participant’s estate) shall be issued the number of shares of Common Stock represented by such Restricted Stock Units. Such shares shall be issued as soon as practicable following the Participant’s death, but no later than the 15th day of the third month of the calendar year after the calendar year in which the Participant’s death occurs.

 

 

 

 

(d)     Any restrictions on Cash-Settled Restricted Stock Units shall lapse, and the Participant’s designated beneficiary (or in the absence of such beneficiary, the Participant’s estate) shall receive a cash payment for each Cash-Settled Restricted Stock Unit equal to the fair market value per share of Common Stock on the NASDAQ Stock Market as of the date of the Participant’s death. Such payment shall be made as soon as practicable following the Participant’s death, but no later than the 15th day of the third month of the calendar year after the calendar year in which the Participant’s death occurs.

 

(e)     The Participant’s designated beneficiary (or in the absence of such beneficiary, the Participant’s estate) shall receive a prorated payout of any Performance Stock Awards, Performance Stock Unit Awards and Performance Unit Awards. The prorated payout shall be based upon the length of time that the Participant held such Awards prior to his or her death relative to the period for which performance is measured, and shall be determined as if the maximum performance objective had been attained. Such payment shall be made as soon as practicable following the Participant’s death, but no later than the 15th day of the third month of the calendar year after the calendar year in which the Participant’s death occurs.

 

(f)     Dividend Equivalent Awards that are unvested or subject to restrictions shall immediately vest and such restrictions shall lapse, and the Participant’s designated beneficiary (or in the absence of such beneficiary, the Participant’s estate) shall receive a cash payment equal to the amount of dividend equivalents credited to the Participant. Such payment shall be made as soon as practicable following the Participant’s death, but no later than the 15th day of the third month of the calendar year after the calendar year in which the Participant’s death occurs.

 

8.2     Termination by Reason of Disability. Unless otherwise provided in an agreement governing the grant of an Award or as determined by the Committee, if a Participant incurs termination of employment due to disability:

 

(a)     Any unexpired and unexercised Options and/or Stock Appreciation Rights held by such Participant shall thereafter be fully exercisable (whether or not such Options or Stock Appreciation Rights were fully vested at the time the Participant became disabled) for a period of three years (except for incentive stock options, in which case the period shall be one year) immediately following the date of such termination of employment, or until the expiration of the Option or Stock Appreciation Right if shorter. The Participant's death at any time following such termination due to disability shall not affect the foregoing. In the event of termination due to disability, if an incentive stock option is exercised more than one year after such termination of employment (or such other time period as may apply under Section 422 of the Code), such Option shall thereafter be treated as a non-qualified stock option.

 

 

 

 

(b)     Any restrictions on shares of Restricted Stock shall lapse and the Participant shall be fully vested in the Restricted Stock.

 

(c)     Any restrictions on Restricted Stock Units shall lapse, and the Participant shall be issued the number of shares of Common Stock represented by such Restricted Stock Units.

 

(d)     Any restrictions on Cash-Settled Restricted Stock Units shall lapse, and the Participant shall receive a cash payment for each Cash-Settled Restricted Stock Unit equal to the fair market value per share of Common Stock on the NASDAQ Stock Market as of the date of the Participant’s termination of employment.

 

(e)     The Participant shall receive a prorated payout of any Performance Stock Awards, Performance Stock Unit Awards and Performance Unit Awards. The prorated payout shall be based upon the length of time that the Participant held such Awards prior to his or her termination of employment due to disability relative to the period for which performance is measured, and shall be determined as if the maximum performance objective had been attained. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment due to disability, or (ii) the date of the Participant’s death.

 

(f)     Any Dividend Equivalent Awards that are unvested or subject to restrictions shall immediately vest and such restrictions shall lapse, and the Participant shall receive a cash payment equal to the amount of dividend equivalents credited to the Participant.

 

Unless otherwise defined in the agreement governing the grant of an Award, "disability" shall mean a mental or physical illness or injury that entitles the Participant to receive benefits under the long term disability plan of the Company or a Subsidiary, or if the Participant is not covered by such a plan, a mental or physical illness that renders a Participant totally and permanently incapable of performing the Participant's duties for the Company or a Subsidiary. Notwithstanding the foregoing, a "disability" shall not qualify under the Plan if it is the result of: (i) a willfully self-inflicted injury or willfully self-induced sickness; or (ii) an injury or disease contracted, suffered or incurred, while participating in a criminal offense. The determination of disability shall be made by the Committee. The determination of disability for purposes of the Plan shall not be construed as an admission of disability for any other purpose.

 

 

 

 

8.3     Voluntary Termination Before Retirement or Termination for Cause. Unless otherwise provided in an agreement governing the grant of an Award or as determined by the Committee, if a Participant voluntarily terminates his or her employment before retirement or is terminated for cause:

 

(a)     Any unexpired and unexercised Options and/or Stock Appreciation Rights held by such Participant shall immediately terminate. The death or disability of the Participant after such a termination of employment shall not renew the exercisability of any Option or Stock Appreciation Right.

 

(b)     All shares of Restricted Stock still subject to restriction shall be forfeited by the Participant, except the Committee shall have the discretion in whole or in part to waive any or all remaining restrictions with respect to any or all of such Participant's shares of Restricted Stock.

 

(c)     All Restricted Stock Units, Cash-Settled Restricted Stock Units, and Dividend Equivalent Awards still subject to restriction or vesting conditions shall be forfeited by the Participant, except the Committee shall have the discretion in whole or in part to waive any or all remaining restrictions with respect to any or all of such Participant's Restricted Stock Units, Cash-Settled Restricted Stock Units, and/or Dividend Equivalent Awards.

 

(d)     All Performance Stock Awards, Performance Stock Unit Awards and Performance Unit Awards shall be forfeited by the Participant to the Company.

 

Unless otherwise defined in the agreement governing the grant of an Award, "termination for cause" shall mean termination because of (i) any act or failure to act deemed to constitute cause under the Company's established practices policies or guidelines applicable to the Participant or (ii) the Participant's act or omission constituting gross misconduct with respect to the Company or a Subsidiary in any material respect.

 

8.4     Other Termination. Unless otherwise provided in an agreement governing the grant of an Award or as determined by the Committee, if a Participant's employment terminates for any reason (including retirement) other than the reasons listed in Section 8.1 through 8.3 above:

 

(a)     Any unexpired and unexercised Options and/or Stock Appreciation Rights held by such Participant shall thereupon terminate, except that any such Option or Stock Appreciation Right, to the extent vested on the date of the Participant's termination, may be exercised by the Participant for a period of three years (except for incentive stock options, in which case the period shall be (3) three months) immediately following the date of such termination of employment, or until the expiration of the Option or Stock Appreciation Right if shorter. The death or disability of the Participant after such a termination of employment shall not extend the time permitted to exercise an Option or Stock Appreciation Right.

 

 

 

 

(b)     All shares of Restricted Stock still subject to restriction shall be forfeited by the Participant, except the Committee shall have the discretion in whole or in part to waive any or all remaining restrictions with respect to any or all of such Participant's shares of Restricted Stock.

 

(c)     All Restricted Stock Units, Cash-Settled Restricted Stock Units, and Dividend Equivalent Awards still subject to restriction or vesting conditions shall be forfeited by the Participant, except the Committee shall have the discretion in whole or in part to waive any or all remaining restrictions with respect to any or all of such Participant's Restricted Stock Units, Cash-Settled Restricted Stock Units, and/or Dividend Equivalent Awards.

 

(d)     The Participant shall receive a prorated payout of any Performance Stock Awards, Performance Stock Unit Awards and Performance Unit Awards if and when the performance goals are achieved. The prorated payout shall be based upon the length of time that the Participant held such Awards prior to his or her termination of employment relative to the period for which performance is measured, and the extent to which the performance goals are achieved as certified by the Committee. Such payment shall be made as soon as practicable following the completion of the of the period for which performance goals have been established, but no later than the 15th day of the third month of the calendar year after the calendar year in which such period ends.

.

Unless otherwise defined in the agreement governing the grant of an Award, "retirement" shall mean the Participant's termination of employment after attaining either age 65, or age 60 with the accrual of 10 years of service.

 

ARTICLE IX

 

TERMINATION FOLLOWING CHANGE IN CONTROL

 

9.1     General. Unless otherwise provided in an agreement governing the grant of an Award or as determined by the Committee, and notwithstanding any provision of this Plan to the contrary, if an event constituting a Change in Control of the Company occurs and a Participant either terminates employment for Good Reason or is involuntarily terminated by the Company without cause after the Change in Control:

 

	 	
			(a)

				
			outstanding Options awarded to the Participant that are not yet fully exercisable shall immediately become exercisable in full, and in lieu of shares of Common Stock issuable upon the exercise of Options, the Participant shall receive an amount in cash for each such Option equal to (i) the higher of the closing price of shares of Common Stock reported on the NASDAQ Stock Market on the date of termination of employment or the highest per share price for shares of Common Stock actually paid in connection with any Change in Control of the Company, over (ii) the per share exercise price of such Option. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death;

			

 

 

 

 

	 	
			(b)

				
			outstanding Stock Appreciation Rights (whether Tandem SARs or Stand Alone SARs) awarded to the Participant that are not yet fully exercisable shall immediately become exercisable in full, and the Participant shall receive an amount in cash for each such Stock Appreciation Right equal to (i) the higher of the closing price of shares of Common Stock reported on the NASDAQ Stock Market on the date of termination of employment or the highest per share price for shares of Common Stock actually paid in connection with any Change in Control of the Company, over (ii) the per share exercise price of such Stock Appreciation Right. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death;

			

 

	 	
			(c)

				
			the transferability provisions and the forfeitability provisions relating to Restricted Stock shall immediately cease to apply;

			

 

	 	
			(d)

				
			the forfeitability provisions relating to Restricted Stock Units shall immediately cease to apply, and the Participant shall be issued the number of shares of Common Stock represented by such Restricted Stock Units.

			

 

	 	
			(e)

				
			the forfeitability provisions relating to Cash-Settled Restricted Stock Units shall immediately cease to apply, and a cash payment shall be made based on the fair market value of the Company’s Common Stock on the date of the Participant’s termination of employment. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death;

			

 

	 	
			(f)

				
			Performance Stock Awards granted hereunder shall immediately vest and shares of Common Stock underlying the award shall be delivered as if the maximum performance objectives had been fully achieved. The delivery of such shares shall occur on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death; and

			

 

	 	
			(g)

				
			Performance Stock Units granted hereunder shall immediately vest and a cash payment shall be made as if the maximum performance objective had been fully achieved. Such cash payment shall be equal to the maximum number of performance stock units granted to the Participant multiplied by the fair market value of the Company’s common stock as the Participant’s termination of employment. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death;

			

 

 

 

 

	 	
			(h)

				
			Performance Unit Awards granted hereunder shall immediately vest and a cash payment shall be made as if the maximum performance objective had been fully achieved. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death’ and

			

 

	 	
			(i)

				
			Dividend Equivalent Awards granted hereunder shall immediately vest and a cash payment shall be made equal to the amount of dividend equivalents credited to the Participant. Such payment shall be made on the earlier of (i) the first day of the seventh month following the date of the Participant’s termination of employment, or (ii) the date of the Participant’s death.

			

 

9.2     Non-Waiver. The Participant’s continued employment with the Company, for whatever duration, following a Change in Control of the Company shall not constitute a waiver of his or her rights with respect to this Article IX. The Participant's right to terminate his or her employment pursuant to this Section 9.2 shall not be affected by his or her incapacity due to physical or mental illness.

 

9.3     Definitions and Additional Rules. For purposes of this Article IX:

 

	 	
			(a)

				
			“Good Reason” shall mean, without the Participant’s written consent, the occurrence after a Change in Control of the Company of any one or more of the following:

			

 

	 	
			(i)

				
			the assignment to the Participant of duties, responsibilities or status that constitute a material diminution in the Participant’s duties, responsibilities or status or a material reduction or alteration in the nature or status of the Participant’s duties and responsibilities;

			

 

	 	
			(ii)

				
			a material reduction by the Company in the Participant's annual base salary as in effect immediately prior to the Change in Control of the Company or as the same shall be increased after the Change in Control of the Company;

			

 

	 	
			(iii)

				
			a material change in the geographic location at which the Participant must provide services; or

			

 

	 	
			(iv)

				
			a material change in or termination of the Company’s benefit plans or programs or the Participant’s participation in such plans or programs (outside of a good faith, across-the-board reduction of general application) in a manner that effectively reduces their aggregate value.

			

 

	 	
			(b)

				
			“Change in Control of the Company” shall be deemed to occur in any of the following circumstances:

			

 

 

 

 

	 	(i)	if there occurs a change in control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) whether or not the Company is then subject to such reporting requirement;

 

	 	
			(ii)

				
			if any “person” (as defined in Sections 13(d) and 14(d) of the Exchange Act) other than John Batten or any member of his family (the “Batten Family”), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company's then outstanding securities;

			

 

	 	
			(iii)

				
			if during any period of two (2) consecutive years (not including any period prior to the execution of this Agreement) there shall cease to be a majority of the Board comprised as follows: individuals who at the beginning of such period constitute the Board and any new director(s) whose election by the Board or nomination for election by the Company's shareholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved; or

			

 

	 	
			(iv)

				
			upon the consummation of a merger or consolidation of the Company with any other corporation, other than a merger or consolidation that results in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 80% of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation, or the consummation of complete liquidation of the Company or the sale or disposition by the Company of all or substantially all the Company's assets.

			

 

(c) To constitute a termination for Good Reason hereunder:

 

	 	
			(i)

				
			Termination of employment must occur within two years following the existence of a condition that would constitute Good Reason hereunder; and

			

 

	 	
			(ii)

				
			The Participant must provide notice to the Company of the existence of a condition that would constitute Good Reason within 90 days following the initial existence of such condition. The Company shall be provided a provided a period of 30 days following such notice during which it may remedy the condition. If the condition is remedied, the Participant’s subsequent voluntary termination of employment shall not constitute termination for Good Reason based upon the prior existence of such condition.

			

 

 

 

 

ARTICLE X

 

NONTRANSFERABILITY

 

10.1     General. Unless otherwise provided in an agreement governing the grant of an Award, a Participant's rights shall be exercisable during the Participant's lifetime only by the Participant, and no Award may be sold, transferred, pledged, assigned or otherwise alienated or hypothecated; provided, that Options and Stock Appreciation Rights are transferable by will or pursuant to the laws of descent and distribution.

 

ARTICLE XI

 

ADJUSTMENT PROVISIONS

 

11.1     Changes in Capitalization. If the Company shall at any time change the number of issued shares of Common Stock without new consideration to the Company (by stock dividends, stock splits, split-up, spin-off, or similar transactions):

 

(a)     the total number of shares reserved for issuance under this Plan, the number of shares covered by or subject to each outstanding Award, the number of outstanding Cash-Settled Restricted Stock Units and the number of outstanding Performance Stock Units, shall be adjusted so that the aggregate consideration payable to the Company, if any, and the value of each such Award shall not be changed; and

 

(b)     the maximum number of Options, Stock Appreciation Rights, Performance Stock Units and shares of Performance Stock that may be granted to any Participant in any fiscal year of the Company shall be proportionately adjusted to reflect the increase or decrease in the issued shares of Common Stock.

 

11.2     Reorganization, Sale, etc.. Awards granted hereunder may also contain provisions for their continuation, acceleration, immediate vesting, or for other equitable adjustments after changes in the Common Stock resulting from the consummation of a reorganization, sale, merger, consolidation, dissolution, liquidation or similar circumstances.

 

11.3     Substitutions and Assumptions. If the Company acquires an entity which has issued and outstanding stock options or other rights, the Company may substitute stock options or rights for options or rights of such entity, including options or other rights to acquire stock at less than 100% of the fair market price of the stock at grant. The number and kind of such stock options and other rights shall be determined by the Committee and the total number of shares reserved for issuance under this Plan shall be appropriately adjusted consistent with such determination and in such manner as the Committee may deem equitable to prevent substantial dilution or enlargement of the Awards granted to, or available for, present or future Participants of this Plan. The number of shares reserved for issuance pursuant to Article III may be increased by the corresponding number of options or other benefits assumed, and, in the case of a substitution, by the net increase in the number of shares subject to options or other benefits before and after the substitution.

 

 

 

 

ARTICLE XII

 

AMENDMENT AND TERMINATION OF PLAN AND CLAWBACKS OF AWARDS

 

12.1     Amendment and Termination of Plan. The Board, without further approval of the Company's shareholders, may amend the Plan from time to time or terminate the Plan at any time, provided that:

 

(a)     no action authorized by this Article shall reduce the amount of any existing Award or change the terms and conditions thereof without the Participant's consent; and

 

(b)     no amendment of the Plan shall, without the approval of the Company's shareholders, (i) increase the total number of shares of Common Stock that may be issued under the Plan or increase the amount or type of Awards that may be granted under the Plan; (ii) change the minimum purchase price, if any, of shares of Common Stock that may be made subject to Awards under the Plan; (iii) modify the requirements as to eligibility for an Award under the Plan; (iv) extend the term of the Plan; or (v) constitute a material revision of the Plan under the listing standards of the NASDAQ Stock Market (or such other listing standards then applicable to the Company).

 

12.2     Clawback of Awards. To the extent required by applicable law or the listing standards of the NASDAQ Stock Market (or such other listing standards then applicable to the Company), including but not limited to Section 304 of the Sarbanes-Oxley Act of 2002, Awards and amounts paid or payable with respect to Awards shall be subject to clawback as determined by the Committee, which clawback may include forfeitures, repurchase, reimbursement and/or recoupment of Awards and amounts paid or payable pursuant to or with respect to Awards, in each instance in accordance with applicable law or listing standards. All Awards granted under this Plan, any property (including shares of Common Stock) received in connection with any exercise or vesting of any Awards, and any proceeds received from the disposition of any such property, shall be subject to such applicable law or listing standards, as well as any clawback policy adopted, and amended from time to time, by the Committee. The Committee shall have discretion with respect to any clawback to determine whether the Company shall effect such recovery:

 

(a)     by seeking repayment from the Participant;

 

(b)     by reducing amounts that would otherwise be payable to the Participant under any compensatory plan, program or arrangement maintained by the Company or any subsidiary or affiliate of the Company (subject to applicable law and the terms and conditions of the applicable plan, program or arrangement);

 

 

 

 

(c)     by withholding payment of future increases in compensation (including the payment of any discretionary bonus amounts) or grants of compensatory awards that would have otherwise been made in accordance with the Company’s applicable compensation practices; or

 

(d)     by any combination of the above.

 

ARTICLE XIII

 

MISCELLANEOUS

 

13.1     Unfunded Status of Plan. It is intended that the Plan constitute an "unfunded" plan for incentive and deferred compensation. The Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provides, however, that unless the Committee otherwise determines, the existence of such trusts or other arrangements is consistent with the "unfunded" status of the Plan.

 

13.2     Withholding Taxes. No later than the date as of which an amount first becomes includible in the gross income of the Participant for federal income tax purposes with respect to any Award or with respect to any exercise of any Option or Stock Appreciation Right granted under the Plan, the Participant shall pay to the Company, or make arrangements satisfactory to the Company or other entity identified by the Committee regarding the payment of any federal, state, local or foreign taxes of any kind required by law to be withheld. Such withholding obligations may be settled with Common Stock, including Common Stock that is part of the Award or that is received upon the exercise of the Award that gives rise to the withholding requirement. The obligations of the Company under the Plan shall be conditional upon such payment or arrangements, and the Company shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant. If the Participant disposes of shares of Common Stock acquired pursuant to an incentive stock option in any transaction considered to be a disqualifying transaction under the Code, the Participant must give written notice of such transfer and the Company shall have the right to deduct any taxes required by law to be withheld from any amounts otherwise payable to the Participant.

 

13.3     No Guaranty of Employment. Nothing herein shall be construed to constitute a contract of employment between the Company or Subsidiary and the Participant. Except as may be provided in a written contract, the Company or Subsidiary and each of the Participants continue to have the right to terminate the employment relationship at any time for any reason.

 

13.4     Controlling Law. The Plan and all Awards made and actions taken hereunder shall be governed by and construed in accordance with the laws of the State of Wisconsin (other than its law respecting choice of law). The Plan shall be construed to comply with all applicable law and to avoid liability to the Company or a Subsidiary, including, without limitation, liability under Section 16(b) of the Exchange Act.

 

 

 

 

13.5     Headings. The headings contained in the Plan are for reference purposes only, and shall not affect the meaning or interpretation of the Plan.

 

13.6     Severability. If any provision of the Plan shall for any reason be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision hereby, and this Plan shall be construed as if such invalid or unenforceable provision were omitted.

 

13.7     Successors and Assigns. This Plan shall inure to the benefit of and be binding upon each successor and assign of the Company. All obligations imposed upon a Participant, and all rights granted to the Company hereunder, shall be binding upon the Participant's heirs, legal representatives and successors.

 

13.8     Entire Agreement. This Plan and any agreements governing the grant of Awards hereunder to any Participant constitute the entire agreement with respect to the subject matter hereof with respect to such Participant, provided that in the event of any inconsistency between the Plan and any such agreement(s), the terms and conditions of the Plan shall control.

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