Document:

exv10w1

 

EXHIBIT 10.1

ABM INDUSTRIES INCORPORATED

“TIME VESTED” INCENTIVE STOCK OPTION PLAN

(as amended and restated as of June 7, 2005)

ARTICLE I

GENERAL

1. PURPOSE.

          This “Time Vested” Incentive Stock Option Plan (the “Plan”) is intended to increase incentive
and to encourage stock ownership on the part of nonemployee directors of ABM Industries
Incorporated (the “Company”) and selected key employees of the Company or of other corporations
which are to become subsidiaries of the Company, and other individuals whose efforts may aid the
Company. It is also the purpose of the Plan to provide such employees and other individuals with a
proprietary interest, or to increase their proprietary interest, in the Company and its
subsidiaries, and to encourage them to remain in the employ of the Company or its subsidiaries. It
is intended that certain options granted pursuant to the Plan shall constitute incentive stock
options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
“Code”), and that certain other options granted pursuant to the Plan shall not constitute incentive
stock options (“nonqualified stock options”).

2. ADMINISTRATION.

          The Plan shall be administered by the Officer Compensation & Stock Option Committee (the
“Committee”) of the Board of Directors of the Company (the “Board”). The Committee shall from time
to time at its discretion make determinations with respect to the persons to who options shall be
granted and the amount of such options. The Committee shall consist of not fewer than three members
of the Board. Each member of the Committee shall be a “disinterested person” as defined in Rule
16b-3 under the Securities Exchange Act of 1934, as amended (“Rule 16b-3”).

          The interpretation and construction by the Committee of any provisions of the Plan or of any
option granted under it shall be final. No member of the Committee shall be liable for any action
or determination made in good faith with respect to the Plan or any option granted under it.

3. ELIGIBILITY.

          Subject to Section 2 of this Article I, the persons who shall be eligible to receive options
under the Plan shall be such officers and key employees (including directors who are also salaried
employees of the Company) of the Company as the Committee shall select. In addition, independent
contractors of the Company who are not also salaried employees of the Company shall be eligible to
receive nonqualified stock options (but

 

 

such persons shall not be eligible to receive incentive
stock options). The terms “officers and key employees” as used herein shall mean such key employees
as may be determined by the Committee in its sole discretion. Directors of the Company who are not
employees of the Company nor of any of its subsidiary corporations (“nonemployee directors”) shall
be eligible only for the options automatically granted pursuant to Article V.

          Except where the context otherwise requires, the term “Company,” as used herein, shall include
(i) ABM Industries Incorporated and (ii) any of its “subsidiary corporations” which meet the
definition of subsidiary corporation contained in Section 424(f) of the Code, and the terms
“officers and key employees of the Company,” and words of similar import, shall include officers
and key employees of each such subsidiary corporation, as well as officers and key employees of ABM
Industries Incorporated.

4. SHARES OF STOCK SUBJECT TO THE PLAN.

          The shares that may be issued under the Plan shall be authorized and unissued and reacquired
shares of the Company’s common stock (the “Common Stock”). The aggregate number of shares which may
be issued under the Plan shall not exceed 8,400,000 shares of Common Stock, unless an adjustment is
required in accordance with Article III.

5. AMENDMENT OF THE PLAN.

          The Board of Directors may at any time, or from time to time, amend this Plan in any respect,
except that, to the extent required to maintain this Plan’s qualification under Rule 16b-3, any
such amendment shall be subject to stockholder approval. In addition, as required by Rule 16b-3,
the provisions of Article V regarding the formula for determining the amount, exercise price, and
timing of nonemployee director options shall in no event be amended more than once every six
months, other than to comport with changes in the Code and/or the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”). (ERISA is inapplicable to the Plan.)

6. APPROVAL OF STOCKHOLDERS.

          All options granted under the Plan before the Plan is approved by affirmative vote at the next
meeting of stockholders of the Company, or any adjournment thereof, of the holders of a majority of
the outstanding shares of Common Stock shall be subject to such approval. No option granted
hereunder may become exercisable unless and until such approval is obtained.

7. TERM OF PLAN.

          The Plan, as amended and restated herein, shall remain in effect until amended or terminated
by the Board in accordance with Section 5 of Article I. However, without further stockholder
approval, no option which is intended to be an incentive stock option may be granted under the Plan
after December 19, 2005. Notwithstanding the foregoing,

2

 

each option granted under the Plan shall
remain in effect until such option has been satisfied by the issuance of shares or terminated in
accordance with its terms and the terms of the Plan.

8. RESTRICTIONS

          All options granted under the Plan shall be subject to the requirement that, if at any time
the Committee shall determine, in its discretion, that the listing, registration or qualification
of the shares subject to options granted under the Plan upon any securities exchange or under any
state or federal law, or the consent or approval of any government regulatory body, is necessary or
desirable as a condition of, or in connection with, the granting of such option or the issuance, if
any, or purchase of shares in connection therewith, such options may not be exercised in whole or
in part unless such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Committee.

9. NONASSIGNABILITY.

          No option shall be assignable or transferable by the grantee except by will or by the laws of
descent and distribution. During the lifetime of the optionee, the option shall be exercisable only
by him, and no other person shall acquire any rights therein.

10. WITHHOLDING TAXES.

          Whenever shares of Common Stock are to be issued under the Plan, the Company shall have the
right to require the optionee to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any certificate or
certificates for such shares.

11. DEFINITION OF “FAIR MARKET VALUE.”

          For the purposes of this Plan, the term “fair market value,” when used in reference to the
date of grant of an option or the date of surrender of Common Stock in payment for the purchase of
shares pursuant to the exercise of an option, as the case may be, shall refer to the closing price
of the Common Stock as quoted in the Composite Transactions Index for the New York Stock Exchange,
on the day before such date as published in the “Wall Street Journal,” or if no sale price was
quoted in any such Index on such date, then as of the next preceding date on which such a sale
price was quoted; provided, however, that when the term “fair market value” is used in reference to
the grant of an option which is effective on a future date set by the Compensation Committee, “fair
market value” shall refer to the closing price of the Common Stock as quoted in the Composite
Transactions Index for the New York Stock Exchange, on such effective date as published in the
“Wall Street Journal.”

ARTICLE II

3

 

STOCK OPTIONS

1. AWARD OF STOCK OPTIONS.

          Awards of stock options may be made under the Plan under all the terms and conditions
contained herein. However, in the cases of incentive stock options the aggregate fair market value
(determined as of the date of grant) of the stock with respect to which incentive stock options are
exercisable for the first time by such officer or key employee during any calendar year (under all
incentive stock options plans of the Company and its parent and subsidiary corporations) shall not
exceed $100,000. The date on which any option is granted shall be the date of the Committee’s
authorization of such grant or such later date as may be determined by the Committee at the time
such grant is authorized.

2. TERM OF OPTIONS AND EFFECT OF TERMINATION.

          Notwithstanding any other provision of the Plan, no nonqualified stock option granted under
the Plan shall be exercisable after the expiration of ten (10) years and one (1) month from the
date of its grant, and no incentive stock option granted under the Plan shall be exercisable after
the expiration of ten (10) years from the date of grant. In addition, notwithstanding any other
provision of the Plan, no incentive stock option granted under the Plan to a person who, at the
time such option is granted and in accordance with Section 425(d) of the Code, owns stock
possessing more than 10% of the total combined voting power of all classes of stock of the Company
shall be exercisable after the expiration of five (5) years from the date of its grant.

          In the event that any outstanding option under the Plan expires by reason of lapse of time or
otherwise is terminated for any reason, then the shares of Common Stock subject to any such option
which have not been issued pursuant to the exercise of the option shall again become available in
the pool of shares of Common Stock for which options may be granted under the Plan.

3. CANCELLATION OF AND SUBSTITUTION FOR NONQUALIFIED OPTIONS.

          The Company shall have the right to cancel any nonqualified stock option at any time before it
otherwise would have expired by its terms and to grant to the same optionee in substitution
therefor a new nonqualified stock option stating an option price which is lower (but not higher)
than the option price stated in the cancelled option. Any such substituted option shall contain all
other terms and conditions of the cancelled option provided, however, that notwithstanding Section
2 of this Article II such substituted option shall not be exercisable after the expiration of ten
(10) years from the date of grant of the cancelled option.

4. TERMS AND CONDITIONS OF OPTIONS.

4

 

          Options granted pursuant to the Plan shall be evidenced by agreements in such form as the
Committee shall from time to time determine, which agreements shall comply with the following terms
and conditions.

(A) OPTIONEE’S AGREEMENT

          Each optionee shall agree to remain in the employ of and to render to the Company his services
for a period of one (1) year from the date of the option, but such agreement shall not impose upon
the Company any obligation to retain the optionee in its employ for any period.

(B) NUMBER OF SHARES AND TYPE OF OPTION

          Each option agreement shall state the number of shares to which the option pertains and
whether the option is intended to be an incentive stock option or a nonqualified stock option.
Notwithstanding any contrary provision of the Plan, during any single fiscal year of the Company,
no individual shall be granted options covering more than 100,000 shares of Common Stock.

(C) OPTION PRICE

          Each option agreement shall state the option price per share (or the method by which such
price shall be computed). The option price per share shall not be less than 99% of the fair market
value of a share of the Common Stock on the date such option is granted. In the cases of incentive
stock options and options granted to non-employee directors pursuant to Article V hereof, the
option price shall be not less than 100% of the fair market value of a share of the Common Stock on
the date such option is granted. Notwithstanding the foregoing, the option price per share of an
incentive stock option granted to a person who, on the date of such grant and in accordance with
Section 424(d) of the Code, owns stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company shall be not less than 110% of the fair market value of a
share of the Common Stock on the date that the option is granted.

(D) MEDIUM AND TIME OF PAYMENT

          The option price shall be payable upon the exercise of an option in the legal tender of the
United States or, in the discretion of the Committee, in shares of the Common Stock or in a
combination of such legal tender and such shares. Upon receipt of payment, the Company shall
deliver to the optionee (or person entitled to exercise the option) a certificate or certificates
for the shares of Common Stock to which the option pertains.

(E) EXERCISE OF OPTIONS

          Pursuant to the terms of a written option agreement approved by the Committee, each option
shall become exercisable at a rate of twenty percent (20%) per

5

 

year of the shares subject to the
option, commencing one year after the date that the option was granted, but only if the optionee
has been continuously employed by the Company from the date of grant through the date of vesting.
The Committee may, in its discretion, waive any vesting provisions contained in an option
agreement.

          To the extent that an option has become vested (except as provided in Article III), and
subject to the foregoing restrictions, it may be exercised in whole or in such lesser amount as may
be authorized by the option agreement provided, however, that no partial exercise of an option
shall be for fewer than twenty-five (25) shares. If exercised in part, the unexercised portion of
an option shall continue to be held by the optionee and may thereafter be exercised as herein
provided. Notwithstanding any inconsistent or contrary Plan provisions, in the event an optionee
who is at least age 64 dies while in the service of the Company or of a subsidiary, all unvested
options granted after April 19, 1999 shall immediately vest and become fully exercisable as of the
date of such death.

(F) TERMINATION OF EMPLOYMENT EXCEPT BY DISABILITY OR DEATH

          In the event that an optionee shall cease to be employed by the Company for any reason other
than his death or disability, his option shall terminate on the date three (30) months after the
date that he ceases to be an employee of the Company.

(G) DISABILITY OF OPTIONEE

          If an optionee shall cease to be employed by the Company by reason of his becoming permanently
and totally disabled within the meaning of Section 22(e)(3) of the Code (as determined by the
Committee), such option shall terminate on the date one (1) year after cessation of employment due
to such disability.

(H) DEATH OF OPTIONEE AND TRANSFER OF OPTION

          If an optionee should die while in the employ of the Company, or within the three-month period
after termination of his employment with the Company during which he is permitted to exercise an
option in accordance with Subsection 4(F) of this Article II, such option shall terminate on the
date one (1) year after the optionee’s death. During such one-year period, such option may be
exercised by the executors or administrators of the optionee’s estate or by any person or persons
who shall have acquired the option directly from the optionee by his will or the applicable law of
descent and distribution. During such one-year period, such option maybe exercised with respect to
the number of shares for which the deceased optionee would have been entitled to exercise it at the
time
of his death and also with respect to 10 percent of the additional number of shares for which he
would have been entitled to exercise it during the balance of the option period, had he survived
and remained in the employ of the Company.

ARTICLE III

RECAPITALIZATIONS AND REORGANIZATIONS

6

 

    The number of shares of Common Stock covered by the Plan, the maximum number of shares with
respect to which options may be granted during any single fiscal year to any employee, and the
number of shares and price per share of each outstanding option, shall be proportionately adjusted
for any increase or decrease in the number of issued and outstanding shares of Common Stock
resulting from a subdivision or consolidation of shares or the payment of a stock dividend, or any
other increase or decrease in the number of issued and outstanding shares of Common Stock effected
without receipt of consideration by the Company.

    If
the Company shall be the surviving corporation in any merger or consolidation, each
outstanding option shall pertain to and apply to the securities to which a holder of the same
number of shares of Common Stock that are subject to that option would have been entitled (unless
the Committee determines the provisions of the following sentences are applicable to such merger or
consolidation). A Change in Control of the Company (as defined below) shall cause each outstanding
option to terminate, provided that each optionee in the event of a Change in Control which will
cause his option to terminate shall have the right immediately prior to such Change in Control to
exercise his option in whole or in part, subject to every limitation on the exercisability of such
option other than any vesting provisions. For purposes hereof, a “Change in Control” means:

     (1) the acquisition (other than by ABM or by an employee benefit plan or related
trust sponsored or maintained by ABM), directly or indirectly, in one or more transactions,
by any person or by any group of persons, within the meaning of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934 or any comparable successor provisions (the “Exchange
Act”), of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
twenty-five percent or more of either the outstanding shares of common stock or the
combined voting power of ABM’s outstanding voting securities entitled to vote generally, if
the acquisition was not previously approved by the existing directors;

     (2) the acquisition (other than by ABM or by an employee benefit plan or related
trust sponsored or maintained by ABM), directly or indirectly, in one or more transactions,
by any such person or by any group of persons of beneficial ownership (within the meaning
of Rule 13d-3 of the Exchange Act) of fifty percent or more of
either the outstanding shares of common stock or the combined voting power of ABM’s outstanding voting securities
entitled to vote generally, whether or not the acquisition was approved by the existing
directors, other than an acquisition that complies with clause (i) and (ii) of paragraph
(3);

     (3) consummation of a reorganization, merger or consolidation of ABM or the sale or
other disposition of all or substantially all of ABM’s assets unless, immediately following
such event, (i) all or substantially all of the stockholders of ABM immediately prior to
such event own, directly or indirectly, seventy-five percent or more of the then
outstanding voting securities entitled to vote generally

7

 

of the resulting corporation
(including without limitation, a corporation which as a result of such event owns ABM or
all or substantially all of ABM’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership of ABM’s outstanding
voting securities entitled to vote generally immediately prior to such event and (ii) the
securities of the surviving or resulting corporation received or retained by the
stockholders of ABM is publicly traded;

     (4) approval by the stockholders of the complete liquidation or dissolution of ABM;
or

     (5) a greater than one-third change in the composition of the Board of Directors
within 24 months if not approved by a majority of the pre-existing directors.

provided that, with respect of options that are outstanding as of September 22, 1999, the following
shall also apply:

     A dissolution or liquidation of the Company, a merger or consolidation in which the
Company is not the surviving corporation or a “change in control” of the Company (as
defined below) (each a “Terminating Transaction”), shall cause each outstanding option to
terminate, unless the agreement of merger or consolidation or any agreement relating to a
dissolution, liquidation or change in control shall otherwise provide, provided that each
optionee in the event of a Terminating Transaction which will cause his option to terminate
shall have the right immediately prior to such Terminating Transaction to exercise his
option in whole or in part, subject to every limitation on the exercisability of such
option other than any vesting provisions. For purposes of this proviso only, a“change of
control” shall be deemed to have occurred when (i) a person or group or persons acquires
fifty percent (50%) or more of the Company’s voting securities, and (ii) the Board of
Directors of the company or the Committee shall have determined that such a “change of
control,” as established by the Board or Committee, has been satisfied.

          The foregoing adjustments shall be made by the Committee, whose determination in that respect
shall be final, binding and conclusive.

          The grant of an option pursuant to the Plan shall not affect in any way the right or power of
the Company to make adjustments, reclassifications, reorganizations or changes of its capital or
business structure or to merge or to consolidate or to dissolve, liquidate or sell, or transfer all
or any part of its business or assets.

ARTICLE IV

MISCELLANEOUS PROVISIONS

1. RIGHTS AS A STOCKHOLDER.

8

 

          An optionee or a transferee of an option shall have no rights as a stockholder with respect to
any shares covered by an option until the date of the receipt of payment (including any amounts
required by the Company pursuant to Section 10 of Article I) by the Company. No adjustment shall be
made as to any option for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is prior to such date of
receipt of payment, except as provided in Article III.

2. MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS.

          Subject to the terms and conditions and within the limitations of the Plan, the Committee may
modify, extend, renew or cancel outstanding options granted under the Plan. Notwithstanding the
foregoing, however, no modification of an option shall, without the consent of the optionee impair
or diminish any rights or obligations under any option theretofore granted under the Plan. For
purposes of the preceding sentence, the right of the Company pursuant to Section 3 of Article II to
cancel any outstanding nonqualified option and to issue therefor a substituted nonqualified option
stating a lower portion price shall not be construed or impairing or diminishing an optionee’s
rights or obligations.

3. OTHER PROVISIONS.

          The option agreements authorized under the Plan shall contain such other provisions,
including, without limitation, restrictions upon the exercise of the option or restrictions
required by any applicable securities laws, as the Committee shall deem advisable.

4. APPLICATION OF FUNDS.

          The proceeds received by the Company from the sale of Common Stock pursuant to the exercise of
options will be used for general corporate purposes.

5. NO OBLIGATION TO EXERCISE OPTION.

          The granting of an option shall impose no obligation upon the optionee or a transferee of the
option to exercise such option.

ARTICLE V

NONEMPLOYEE DIRECTOR OPTIONS

          The provisions of this Article V are applicable only to options granted to nonemployee
directors. The provisions of Article II are applicable to options granted to other individuals.

9

 

1. GRANTING OF OPTIONS.

          Each nonemployee director who is a nonemployee director on the date of the 1994 Annual Meeting
of Stockholders, automatically will receive, as of such date only, an option to purchase 10,000
shares of Common Stock. Each nonemployee director who becomes a nonemployee director after the
1994 Annual Meeting of Stockholders automatically will receive, as of the date of such nonemployee
director’s election or appointment to the Board of Directors of the Company, an option to purchase
10,000 shares of Common Stock.

          Each continuing
nonemployee director (i.e., a nonemployee director who has received an
initial grant of an option to purchase 10,000 shares of Common Stock) automatically will receive, on the first day of each subsequent
fiscal year, an option to purchase 10,000 shares of Common Stock.

2. TERMS OF OPTIONS.

(A) OPTION AGREEMENT

          Each option shall be evidenced by written stock option agreement which shall be executed by
the optionee and the Company.

(B) OPTION PRICE

          The price of the shares subject to each option shall be 100% of the fair market value for such
shares on the date that the option is granted.

(C) EXERCISABILITY

          An option granted pursuant to this Article V shall become exercisable at the rate of twenty
percent (20%) per year of the shares subject to the option, commencing one year after the date that
the option was granted, but only if the optionee has been a nonemployee director continuously from
the date of grant through the date of vesting.

(D) EXPIRATION OF OPTIONS

          In the event that an optionee shall cease to be a nonemployee director for any reason other
than his death or disability, his option shall terminate on the date three (3) months after the
date that he ceases to be a nonemployee director.

          If an optionee shall cease to be a nonemployee director by reason of his becoming permanently
and totally disabled within the meaning of Section 22(e)(3) of the Code (as determined by the
Committee), such option shall terminate on the date one (1) year after his cessation of service as
nonemployee director.

10

 

          If an optionee should die while a nonemployee director, or within the three-month period
described above in this Subsection 2(D), such option shall terminate on the date one (1) year after
the optionee’s death. During such one-year period, such option may be exercised by the executors or
administrators of the optionee’s estate or by any person or persons who shall have acquired the
option directly from the optionee by his will or the applicable law of descent and distribution.
During such one-year period, such option may be exercised with respect to the number of shares for
which the deceased optionee would have been entitled to exercise it at the time of his death and
also with respect to 10 percent of the additional number of shares for which he would have been
entitled to exercise it during the balance of the option period, had he survived and remained a
nonemployee director.

(E) INCENTIVE STOCK OPTIONS.

          Options granted pursuant to this Article V shall not be designated as incentive stock options.

(F) OTHER TERMS.

          All provisions of the Plan not inconsistent with this Article V shall apply to options granted
to nonemployee directors.

11exv10w2

 

EXHIBIT 10.2

ABM INDUSTRIES INCORPORATED

2002 PRICE-VESTED PERFORMANCE STOCK OPTION PLAN

(as amended and restated June 7, 2005)

 

	1.	 	PURPOSE; DEFINITIONS.

     ABM Industries Incorporated hereby establishes the ABM Industries Incorporated 2002
Price-Vested Performance Stock Option Plan (the “Plan”), effective as of December 11, 2001. The
purpose of the Plan is to give ABM Industries Incorporated and its Affiliates a long-term stock
option plan to help in recruiting, retaining motivating and rewarding senior executives, and to
provide the Company and its Affiliates with the ability to provide incentives more directly linked
to the profitability of the Company’s businesses and increases in stockholder value.

     For purposes of the Plan, the following terms are defined as set forth below:

a. “Affiliate” or “Affiliates” means any and all subsidiary corporations or other entities
controlled by the Company and designated by the Committee from time to time as such.

b. “Board” or “the Board” means the board of directors (“Directors”) of the Company.

c. “Cause” means:

(1) misconduct or any other willful or knowing violation of any Company policy or
employment agreement,

(2) unsatisfactory performance such that the Company notifies the Optionee of the
Company’s intention not to renew the Optionee’s employment agreement with the
Company,

(3) a material breach by the Optionee of his or her duties as an employee which is
committed in bad faith or without reasonable belief that such reach is in the best
interests of the Company and its affiliated companies (other than a breach arising
from the failure of the Optionee to work as a result of incapacity due to physical
or mental illness) and which is not remedied in a reasonable period of time after
receipt of written notice from the Company specifying such breach, or

(4) the conviction of the Optionee of a felony that has been affirmed on appeal or
as to which the period in which an appeal can be taken has lapsed.

d. “Change in Control” and “Change in Control Price” have the meanings set forth in Sections
6b and 6c of the Plan, respectively.

 

 

e. “Code” or “the Code” means the Internal Revenue Code of 1986, as amended from time to
time, and any successor thereto.

f. “Commission” or “the Commission” means the Securities and Exchange Commission or any
successor agency.

g. “Committee” or “the Committee” means the committee referred to in Section 2 of the Plan.

h. “Company” or “the Company” means ABM Industries Incorporated, a Delaware corporation.

i. “Disability” means the inability of the Optionee to perform his or her duties as an
employee on an active fulltime basis as a result of incapacity due to mental or physical
illness which continues for more than ninety (90) days after the commencement of such
incapacity, such incapacity to be determined by a physician selected by the Company or its
insurers and acceptable to the Optionee or the Optionee’s legal representative (such
agreement as to acceptability not to be withheld unreasonably).

j. “Eligible Person” has the meaning set forth in Section 4 of the Plan.

k. “Exchange Act” or “the Exchange Act” means the Securities Exchange Act of 1934, as
amended from time to time, and any comparable successor provisions.

l. For the purposes of this Plan, the term “fair market value,” when used in reference to
the date of grant of an option or the date of surrender of Common Stock in payment for the
purchase of shares pursuant to the exercise of an option, as the case may be, shall refer to
the closing price of the Common Stock as quoted in the Composite Transactions Index for the
New York Stock Exchange, on the day before such date as published in the “Wall Street
Journal,” or if no sale price was quoted in any such Index on such date, then as of the next
preceding date on which such a sale price was quoted; provided, however, that when the term
“fair market value” is used in reference to the grant of an option which is effective on a
future date set by the Compensation Committee, “fair market value” shall refer to the
closing price of the Common Stock as quoted in the Composite Transactions Index for the New
York Stock Exchange, on such effective date as published in the “Wall Street Journal.”

m. “Non-Employee Director” shall mean a member of the Board who qualifies as a Non-Employee
Director as defined in Rule 16b-3, and also qualifies as an “outside director” for the
purposes of Section 162(m) of the Code and the regulations promulgated thereunder.

n. “Optionee” shall mean any Eligible Person who has been granted Stock Options under the
Plan.

2

 

o. “Plan” or “the Plan” means the ABM Industries Incorporated 2002 Price-Vested Performance
Stock Option Plan, as set forth herein and as hereinafter amended from time to time.

p. “Retirement” means retirement from active full-time employment with the Company or any of
its Affiliates at or after age sixty-four (64).

q. “Rule 16b-3” means Rule 16b-3, as promulgated by the Commission under Section 16(b) of
the Exchange Act, as amended from time to time.

r. “Stock” means common stock, par value $0.01 per share, of the Company.

s. “Stock Option” or “Option” means an option granted under Section 5 of the Plan.

t. “Termination of Employment” means the termination of an Optionee’s employment with the
Company or any of its Affiliates, excluding any such termination where there is a
simultaneous reemployment by the Company or any of its Affiliates. An Optionee shall be
deemed to have terminated employment if he or she ceases to perform services for the Company
or any of its Affiliates on an active full-time basis, notwithstanding the fact that such
Optionee continues to receive compensation or benefits pursuant to an employment contract or
other agreement or arrangement with the Company or any of its Affiliates. A non-medical
leave of absence shall, unless such leave of absence is otherwise approved by the Committee,
be deemed a Termination of Employment. An Optionee employed by an Affiliate of the Company
shall also be deemed to incur a Termination of Employment if that Affiliate ceases to be an
Affiliate of the Company, as the case may be, and that Optionee does not immediately
thereafter become an employee of the Company or any other Affiliate of the Company.

In addition, certain other terms have definitions given to them as they are used herein.

	2.	 	ADMINISTRATION.

     The Plan shall be administered by the Executive Officer Compensation & Stock Option Committee
of the Board or such other committee of the Board, composed solely of not less than two
Non-Employee Directors, each of whom shall be appointed by and serve at the pleasure of the Board.
If at any time no such committee(s) shall be in office, the functions of the Committee specified in
the Plan shall be exercised by the Board.

     The Committee shall have all discretionary authority to administer the Plan and to grant Stock
Options pursuant to the terms of the Plan to senior executives of the Company and any of its
Affiliates.

     Among other things, the Committee shall have the discretionary authority, subject to the terms
of the Plan:

3

 

a. to select the Eligible Persons to whom Stock Options may from time to time be granted;

b. to determine the number of shares of Stock to be covered by each Stock Option granted
hereunder; and

c. to determine the terms and conditions of any Stock Option granted hereunder including,
but not limited to, the option price (subject to Section 5a of the Plan) and any vesting
condition, restriction or limitation based on such factors as the Committee shall determine.

     The Committee shall have the authority to adopt, alter and repeal such administrative rules,
guidelines and practices governing the Plan as it shall, from time to time, deem advisable, to
interpret the terms and provisions of the Plan and any Stock Option issued under the Plan (and any
agreement relating thereto) and to otherwise supervise the administration of the Plan.

     The Committee may act only by a majority of its members then in office, except that the
members thereof may authorize any one or more of their number or any officer of the Company to
execute and deliver documents on behalf of the Committee.

     Any determination made by the Committee or pursuant to delegated authority pursuant to the
provisions of the Plan with respect to any Stock Option shall be made in the sole discretion of the
Committee or such delegate at the time of the grant of the Stock Option or, unless in contravention
of any express term of the Plan, at any time thereafter. All decisions made by the Committee or any
appropriately delegated officer pursuant to the provisions of the Plan shall be final and binding
on all persons, including the Company and plan participants, and shall be given the maximum
deference permitted by law.

	3.	 	STOCK SUBJECT TO PLAN.

     Subject to adjustment as provided herein, the total number of shares of Stock available for
grant under the Plan shall be four million (4,000,000). No individual shall be eligible to receive
Stock Options to purchase more than 200,000 shares of Stock under the Plan. Shares subject to a
Stock Option under the Plan may be authorized and unissued shares or may be treasury shares.

     If any Stock Option terminates without being exercised, shares subject to such Stock Option
shall be available for further grants under the Plan.

     In the event of any merger, reorganization, consolidation, recapitalization, stock dividend,
stock split, or extraordinary distribution with respect to the Stock or other change in corporate
structure affecting the Stock, the Committee or the Board may make such substitution or adjustments
in the number, kind and option price of shares authorized or outstanding as Stock Options, and/or
such other equitable substitution or adjustments as its may determine to be

4

 

appropriate in its sole
discretion; provided, however, that the number of shares subject to any Stock Option shall always
be a whole number.

	4.	 	ELIGIBILITY.

     Senior executives who are actively employed on a full-time basis by the Company or any of its
Affiliates, and who are responsible for or contribute to the management, growth and profitability
of the business of the Company or any of Affiliates, are eligible to be granted Stock Options under
the Plan (“Eligible Persons”).

	5.	 	STOCK OPTIONS.

     Any Stock Option granted under the Plan shall be in the form attached hereto as Annex “A”,
which is incorporated herein and made a part of the Plan, with such changes as the Committee may
from time to time approve which are consistent with the Plan. None of the Stock Options granted
under the Plan shall be “incentive stock options” within the meaning of Section 422 of the Code.

     The grant of a Stock Option shall occur on the date the Committee selects a Senior Executive
of the Company or any of its Affiliates to receive any grant of a Stock Option, determines the
number of shares of Stock to be subject to such Stock Option to be granted to such Senior
Executive, and specifies the terms and provisions of said Stock Option. Such selection shall be
evidenced in the records of the Company whether in the minutes of the meetings of the Committee or
by their consent in writing. The Company shall notify an Optionee of any grant of a Stock Option,
and a written option agreement or agreements shall be duly executed and delivered by the Company to
the Optionee.

     Stock Options granted under the Plan shall be subject to the following terms and conditions
and shall contain such additional terms and conditions as the Committee shall deem desirable:

a. Option Price. The option price per share of Stock purchasable under a Stock Option shall
be no less than the Fair Market Value per share of Stock on the grant date.

b. Option Term. The term of each Stock Option shall be ten (10) years from its date of
grant, unless earlier terminated.

c. Exercisability. Except as otherwise provided herein, each Stock Option shall be
exercisable during its term only if such Stock Option has vested, and only after the first
(1st) anniversary of its date of grant.

d. Vesting. Each Stock Option shall have assigned to it by the Committee a vesting price
(the “Vesting Price”) which will be used to provide for accelerated vesting so that such
Stock Option will vest immediately if, on or before the close of business on the fourth
(4th) anniversary of its date of grant, the Fair Market Value of the Common Stock shall

5

 

have
been equal to or greater than the Vesting Price with respect to such Stock Option for ten
(10) trading days in any period of thirty (30) consecutive trading days. Any Stock Option
that has not vested on or before the close of business on the fourth (4th) anniversary of
its date of grant shall vest at the close of business on the business day immediately
preceding the eighth (8th) anniversary of its date of grant, if such Option has not
previously terminated.

e. Method of Exercise. Subject to the provisions of this Section 5 of the Plan, Stock
Options may be exercised, in whole or in part, by giving written notice of exercise to the
Company specifying the number of shares of Stock subject to the Stock Option to be
purchased.

The option price of Stock to be purchased upon exercise of any Option shall be paid in full:

(1) in cash (by certified or bank check or such other instrument as the Company may
accept),

(2) in the discretion of the Committee, in the form of unrestricted Stock already
owned by the Optionee for six (6) months or more and based on the Fair Market Value
of the Stock on the date the Stock Option is exercised,

(3) in any other form approved in the discretion of the Committee, or

(4) by any combination thereof.

     In the discretion of the Committee, payment for any shares subject to a Stock Option
may also be made by delivering a properly executed exercise notice to the Company, together
with a copy of irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds to pay the purchase price, and, if requested, the amount of
any federal, state, local or foreign withholding taxes. To facilitate the foregoing, the
Company may enter into agreements for coordinated procedures with one or more brokerage
firms.

     No shares of Stock shall be issued until full payment therefor has been made. The
Optionee shall have all of the rights of a stockholder of the Company holding the Stock that
is subject to such Stock Option (including, if applicable, the right to vote the share and
the right to receive dividends), only when the Optionee has given written notice of
exercise, has paid in full for such shares and, if requested, has given the representation
described in Section 9a of the Plan.

f. Non-transferability of Stock Options. No Stock Option shall be transferable by the
Optionee other than:

(1) pursuant to a beneficiary designation satisfactory to the Committee, or

6

 

(2) by will or by the laws of descent and distribution. All Stock Options shall be
exercisable, during the Optionee’s lifetime, only by the Optionee or by the guardian
or legal representative of the Optionee, it being understood that the terms “holder”
and “Optionee” include the guardian and legal representative of the Optionee named
in the option agreement and any person to whom an option is transferred by will or
the laws of descent and distribution or pursuant to a qualified domestic relations
order. The Committee may establish such procedures as it deems appropriate for an
Optionee to designate a beneficiary to whom any amounts payable in the event of the
Optionee’s death are to be paid or by whom any rights of the Optionee, after the
Optionee’s death, may be exercised.

g. Termination by Death, Disability, Retirement or by the Company Without Cause. If the
Optionee’s employment terminates by reason of death, Disability or Retirement, or if such
employment is terminated by the Company without Cause, in each case prior to the vesting of
a Stock Option held by the Optionee, the following provisions shall apply:

(1) if termination occurs by death or Disability, or by the Company without Cause,
such Stock Options shall be exercisable only within ninety (90) days of such
termination, and only if such Stock Options are then vested; and

(2) if
termination occurs by Retirement or other “voluntary quit,” such Stock Options shall terminate immediately.

h. Termination by the Company for Cause. If the Optionee’s employment is terminated by the
Company for Cause prior to the vesting of a Stock Option, such Stock Options shall terminate
immediately.

i. Termination After Vesting. If the Optionee’s employment is terminated for any reason
after a Stock Option has vested, such Stock Options shall be exercisable only within ninety
(90) days of such termination,

j. Change in Control Cash Out. Notwithstanding any other provision of the Plan, upon the
occurrence of a Change of Control all outstanding Stock Options shall immediately vest and
become fully exercisable, and during the ninety (90) day period from and after such Change
in Control (the “Exercise Period”), the Optionee shall have the right, in lieu of the
payment of the exercise price for the shares of Stock being purchased under the Stock Option
and by giving notice to the Company, to elect (within the Exercise Period) to surrender all
or part of the Stock Option to the Company and to receive cash, within ninety (90) days of
such notice, in an amount equal to the amount by which the Change in Control Price per share
of Stock on the date of such election shall exceed the exercise price per share of Stock
under the Stock Option (the “Spread”), multiplied by the number of shares of Stock granted
under the Stock Option as to which the right granted under this Section 5j of the Plan shall
have been exercised.

7

 

	6.	 	CHANGE IN CONTROL PROVISIONS.

a. Impact of Event. Notwithstanding any other provision of the Plan to the contrary, in the
event of a Change in Control, any Stock Options outstanding as of the date such Change in
Control is determined to have occurred, and not then vested and exercisable, shall become
vested and exercisable to the full extent of the original grant, provided that such
accelerated vesting shall occur only if the Optionee is an active full-time employee of the
Company or any of its Affiliates as of such date.

b. Definition of Change in Control. For purposes of the Plan, a “Change in Control” shall
mean the happening of any of the following events:

(i) the acquisition (other than by the Company or by an employee benefit plan or
related trust sponsored or maintained by the Company), directly or indirectly, in
one or more transactions, by any person or by any group of persons, within the
meaning of Section 13(d) or 14(d) of the Exchange Act of beneficial ownership
(within the meaning of Rule 13d-3 of the Exchange Act) of twenty-five percent or
more of either the outstanding shares of common stock or the combined voting power
of the Company’s outstanding voting securities entitled to vote generally, if the
acquisition was not previously approved by the existing directors;

(ii) the acquisition (other than by the Company or by an employee benefit plan or
related trust sponsored or maintained by the Company), directly or indirectly, in
one or more transactions, by any such person or by any group of persons of
beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of fifty
percent or more of either the outstanding shares of common stock or the combined
voting power of the Company’s outstanding voting securities entitled to vote
generally, whether or not the acquisition was approved by the existing directors,
other than an acquisition that complies with clause (x) and (y) of paragraph (iii)
below;

(iii) consummation of a reorganization, merger or consolidation of the Company or
the sale or other disposition of all or substantially all of the Company’s assets
unless, immediately following such event, (x) all or substantially all of the
stockholders of the Company immediately prior to such event own, directly or
indirectly, seventy-five percent or more of the then outstanding voting securities
entitled to vote generally of the resulting corporation (including without
limitation, a corporation which as a result of such event owns the Company or all or
substantially all of the Company’s assets either directly or their ownership of the
Company’s outstanding voting securities entitled to vote generally immediately prior
to such event and (y) the securities of the surviving or resulting corporation
received or retained by the stockholders of the Company is publicly traded;

8

 

(iv) approval by the stockholders of the complete liquidation or dissolution of the
Company; or

(v) a greater than one-third change in the composition of the Board of Directors
within 24 months if not approved by a majority of the pre-existing directors.

c. Change in Control Price. For purposes of the Plan, “Change in Control Price” means the
higher of:

(1) the highest reported sales price, regular way, of a share of Stock in any
transaction reported on the New York Stock Exchange Composite Tape or other national
securities exchange on which such shares are listed or on Nasdaq, as applicable,
during the ninety (90) day period prior to and including the date of a Change in
Control, and or

(2) if the Change in Control is the result of a tender or exchange offer or a
Business Combination, the highest price per share of Stock paid in such tender or
exchange offer or Business Combination; provided, however, that in the case of a
Stock Option which:

(a) is held by an Optionee who is an officer of the Company and is subject
to Section 16(b) of the Exchange Act, and

(b) was granted within two hundred and forty (240) days of the Change in
Control, then the Change in Control Price for such Stock Option shall be the
Fair Market Value of the Stock on the date such Stock Option is exercised or
canceled. To the extent that the consideration paid in any such transaction
described above consists all or in part of securities or other non-cash
consideration, the value of such securities or other non-cash consideration
shall be determined in the sole discretion of the Board.

	7.	 	TERM, AMENDMENT AND TERMINATION.

     The Plan will terminate on December 11, 2011. Stock Options outstanding as of December 11,
2011 shall not be affected or impaired by the termination of the Plan.

     The Committee shall have authority to amend the Plan without the approval of the Company’s
stockholders to take into account changes in law and tax and accounting rules, including Rule 16b-3
and Section 162(m) of the Code; provided that no amendment shall be made without the Optionee’s
consent which would impair the rights of an Optionee under a Stock Option theretofore granted.

	8.	 	UNFUNDED STATUS OF PLAN.

9

 

It is presently 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 Stock or make payments; provided, however,
that, unless the Committee otherwise determines, the existence of such trusts or other arrangements
is consistent with the “unfunded” status of the Plan.

	9.	 	GENERAL PROVISIONS.

a. The Committee may require each person purchasing shares pursuant to a Stock Option to
represent to and agree with the Company in writing that such person is acquiring the shares
without a view to the distribution thereof. The certificates for such shares may include any
legend which the Committee deems appropriate to reflect any restrictions on transfer.

Notwithstanding any other provision of the Plan or agreements made pursuant thereto,
the Company shall not be required to issue or deliver any certificate
or certificates for shares of Stock under the Plan prior to fulfillment of all of the following conditions:

(1) the listing or approval for listing

(2) any registration or other qualification

(3) the obtaining of any other consent, approval, or permit from any state or
federal governmental agency which the Committee shall, in its absolute discretion
after receiving the advice of counsel, determine to be necessary or advisable.

b. Nothing contained in the Plan shall prevent the Company or any of its Affiliates from
adopting other or additional compensation arrangements for any Optionee.

c. The adoption of the Plan shall not confer upon any Optionee any right to continued
employment, nor shall it interfere in any way with the right of the Company or any of its
Affiliates to terminate the employment of any Optionee with or without cause at any time
whatsoever absent a written employment contract to the contrary.

d. No later than the date as of which an amount first becomes includable in the gross income
of the Optionee for federal income tax purposes with respect to any Stock Option under the
Plan, and prior to the delivery of any shares of Stock to any Optionee, the Optionee shall
pay to the Company, or make arrangements satisfactory to the Company regarding the payment
of, any federal, state, local or foreign taxes of any kind required by law to be withheld by
the Company with respect to such amount. In the discretion of the Committee, withholding
obligations may be settled with Stock in an amount having a Fair Market Value not exceeding
the minimum withholding tax payable by the Optionee with respect to the income recognized,
including Stock that is subject to the Stock Option that gives rise to the withholding
requirement. The obligations of the Company under the Plan shall be conditional on such
payment or arrangements, and the Company and any of its

10

 

Affiliates shall, to the extent
permitted by law, have the right to deduct any such taxes from any payment otherwise due to
the Optionee. The Committee shall establish such procedures as it deems appropriate,
including the making of irrevocable elections, for the settlement of withholding obligations
with Stock.

e. In the case of a grant of a Stock Option to any employee of a Company Affiliate, the
Company, may, if the Committee so directs, issue or transfer the shares of Stock covered by
the Stock Option to the Affiliate, for such lawful consideration as the Committee may
specify, upon the condition or understanding that the Affiliate will transfer the shares of
Stock to that Optionee in accordance with the terms of the Stock Option specified by the
Committee pursuant to the provisions of the Plan.

f. The Plan and all Stock Options made and actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of California, without reference to
principles of conflict of law.

	10.	 	EFFECTIVE DATE OF PLAN.

     Subject to approval by the stockholders of the Company, the Plan shall be effective on
December 11, 2001.

11

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}]]