Document:

crwgexhibit102.htm

Exhibit 10.2

 

THIS WARRANT AND THE UNDERLYING SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR QUALIFIED UNDER ANY APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND QUALIFICATION UNDER SUCH STATE SECURITIES LAWS OR AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION AND/OR QUALIFICATION IS NOT REQUIRED.

 

CROWDGATHER, INC.

 

WARRANT TO PURCHASE SHARES OF COMMON STOCK

Issue Date: October 22, 2010

THIS CERTIFIES THAT, for value received, __________________(the “Investor”), or Investor’s assigns (Investor and Investor’s assigns being the “Holder”), is entitled to subscribe for and purchase at any time during the Exercise Period from CrowdGather, Inc., a Nevada corporation, with an office located at 20300 Ventura Blvd., Suite 330, Woodland Hills, CA 91364 (the “Company”), a number of shares of Common Stock equal to the Share Number at a per share price equal to the Exercise Price in effect at such time. This Warrant is issued in conjunction with the shares of the Company’s Preferred Stock issued pursuant to the Subscription Agreement dated as of October 22, 2010, by and between the Company and the Investor.

 

1. Definitions. As used herein, the following terms shall have the following respective meanings:

 

(a)  “Aggregate Warrant Price” shall mean the dollar value obtained by multiplying $0.95 by _____________.

 

(b)  “Common Stock” shall mean the common stock of the Company.

 

(c)  “Exercise Period” shall mean the period commencing on October 22, 2010, and ending on October 22, 2013.

 

(d)  “Exercise Price” shall mean $0.95 per share of Common Stock.

 

(e)  “Exercise Shares” shall mean any Common Stock acquired upon exercise of this Warrant.

 

(f)  “Share Number”, at any time, shall mean (i) the Aggregate Warrant Price minus the aggregate exercise price previously paid upon exercise of this Warrant, divided by (ii) the Exercise Price then in effect.

 

  

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2. Exercise of Warrant.

 

2.1  General; Exercise of Warrant .

 

(a)  The rights represented by this Warrant may be exercised as a whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth above (or at such other address as it may designate by notice in writing to the Holder):

 

(i)           An executed Notice of Exercise in the form attached hereto;

 

(ii)           Payment of the Exercise Price either in cash or by check; and

 

(iii)           This Warrant.

 

(b)  Upon the exercise of the rights represented by this Warrant, a certificate or certificates for the Exercise Shares so purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates (and such designation is in compliance with applicable securities laws and any stockholders, investor rights or similar agreement), shall be issued and delivered to the Holder as promptly as practicable after the rights represented by this Warrant shall have been so exercised.

 

(c)  The person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date on which this Warrant was surrendered and payment of the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open.

 

2.2  Net Issue Exercise .

 

(a)  In lieu of paying the Exercise Price in cash or by check as provided in Section 2.1, the Holder may elect a “Net Issue Exercise” pursuant to which the Holder will receive Exercise Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised) by surrender of this Warrant at the principal office of the Company together with an executed Notice of Exercise in the form attached hereto in which event the Company shall issue to the Holder a number of Exercise Shares computed using the following formula:

 

X = Y (A-B)

A

Where:

 

X = the number of Exercise Shares to be issued to the Holder;

 

Y = the number of Exercise Shares purchasable under the Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (at the date of such exercise);

 

A = the Fair Market Value of one share of the Company’s Common Stock (at the date of such exercise); and

 

B = the Exercise Price (as adjusted to the date of such exercise).

 

  

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(b)  For purposes of the above calculation, “Fair Market Value” shall be determined as follows:

 

(i)  If the Common Stock is listed on any established stock exchange or a national market system, the Fair Market Value of a share of Common Stock will be the average closing sales price for such stock (or the closing bid, if no sales are reported) as quoted on that system or exchange (or the system or exchange with the greatest volume of trading in Common Stock), over the five (5) trading day period ending on the trading day immediately preceding the day the Warrant is being exercised, as reported in the Wall Street Journal or any other source the Company considers reliable.

 

(ii)           If the Common Stock is not listed on any established stock exchange or a national market system but is regularly quoted elsewhere by recognized securities dealers although selling prices are not reported, the Fair Market Value of a share of Common Stock will be the average mean between the high bid and low asked prices for the Common Stock over the five (5) trading day period ending on the trading day immediately preceding the day the Warrant is being exercised, as reported in the Wall Street Journal or any other source the Company considers reliable.

 

(iii)  If the Common Stock is not traded as set forth above, the Fair Market Value will be determined in good faith by the Board of Directors of the Company.

 

(c)  If this Warrant is not exercised in full by a Net Issue Exercise, then, the “Share Number” in effect immediately after such partial exercise shall be appropriately adjusted to take into account the effect of the Net Issue Exercise.

 

3. Covenants of the Company.

 

3.1  Covenants as to Exercise Shares . The Company covenants and agrees that all Exercise Shares that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issuance thereof. The Company further covenants and agrees that the Company will at all times during the Exercise Period have authorized and reserved, free from preemptive rights, a sufficient number of shares of its Common Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Common Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.

 

3.2  No Impairment . Except and to the extent as waived or consented to by the Holder, the Company will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant and in the taking of all such action as may be necessary or appropriate in order to protect the exercise rights of the Holder against impairment.

 

3.3  Notices of Record Date . In the event of any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend (other than a cash dividend which is the same as cash dividends paid in previous quarters) or other distribution, the Company shall mail to the Holder, at least ten (10) days prior to the date specified herein, a notice specifying the date on which any such record is to be taken for the purpose of such dividend or distribution.

 

  

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4. Representations of Holder.

 

4.1  Acquisition of Warrant for Personal Account . The Holder represents and warrants that it is acquiring the Warrant and any shares of capital stock issued or issuable upon exercise or conversion of the Warrant for investment purposes only and not with a view to or for resale in connection with any distribution or public offering thereof within the meaning of the Act (as defined below). The Holder also represents that the entire legal and beneficial interests of the Warrant and Exercise Shares the Holder is acquiring is being acquired for, and will be held for, the account of the Holder only.

 

4.2  Accredited Investor; Off-Shore Transaction; Not a U.S. Person . The Holder represents and warrants that, unless not a “U.S. Person” as defined below, the Holder it is an “accredited investor” as such term is defined in Rule 501 under the Securities Act of 1933, as amended (the “ Act ”). The Holder shall provide the Company with such additional information as the Company may reasonably request with respect to the Holder’s status as an “accredited investor.” The exercise of this Warrant and the transactions contemplated herein may constitute an “off-shore transaction,” as that term is defined in Rule 902(h) of Regulations S promulgated under the Securities Act. If the Holder is not an accredited investor, then the Holder is not a “U.S. Person,” as that term is defined in Rule 902(k) of Regulation S promulgated under the Securities Act.

 

4.3  Securities Are Not Registered .

 

(a)  The Holder understands that the Warrant and the Exercise Shares have not been registered under the Act, on the basis that no distribution or public offering of the stock of the Company is to be effected, or registered or qualified under any applicable state securities laws. The Holder realizes that the basis for the exemption may not be present if, notwithstanding its representations, the Holder has a present intention of acquiring the securities for a fixed or determinable period and, in the future, selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing the securities. The Holder has no such present intention.

 

(b)  The Holder recognizes that the Warrant and the Exercise Shares must be held indefinitely unless they are subsequently registered under the Act or an exemption from such registration is available. The Company has no obligation to register the Warrant or the Exercise Shares of the Company, or to comply with any exemption from such registration.

 

(c)  The Holder is aware that neither the Warrant nor the Exercise Shares may be sold pursuant to Rule 144 adopted under the Act unless certain conditions are met, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale following the required holding period under Rule 144 and the number of shares being sold during any three (3) month period not exceeding specified limitations. For so long as the Warrants are outstanding and for the two-year period thereafter, the Company will use its best efforts to satisfy these conditions.

 

(d)  The Holder is aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision regarding its investment in the Company. The Holder is experienced in making investments of this type and has such knowledge and background in financial and business matters that the Holder is capable of evaluating the merits and risks of this investment and protecting its own interests. The Holder has had an opportunity to ask questions of, and receive answers from, the Company and its officers and employees regarding the business, financial affairs and other aspects of the Company, and has further had the opportunity to obtain information (to the extent the Company possesses or can acquire such information without unreasonable effort or expense) which the Holder deems necessary to evaluate an investment in the Company and to verify the accuracy of information otherwise provided to the Holder.

 

  

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4.4  Disposition of Warrant and Exercise Shares .

 

(a)  Except for transfers by the Holder to its affiliates in compliance with all applicable securities laws, the Holder further agrees not to make any disposition of all or any part of the Warrant or Exercise Shares in any event unless and until:

 

(i)  The Company shall have received a letter secured by the Holder from the Securities and Exchange Commission stating that no action will be recommended to the Commission with respect to the proposed disposition; or

 

(ii)  There is then in effect a registration statement under the Act covering such proposed disposition and such disposition is made in accordance with said registration statement; or

 

(iii)  The Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, for the Holder to the effect that such disposition will not require registration of such Warrant or Exercise Shares under the Act or any applicable state securities laws.

 

(b)  The Holder understands and agrees that all certificates evidencing the Exercise Shares to be issued to the Holder may bear the following legend (in addition to any legend required under applicable state securities laws, the Company’s Bylaws, or as provided elsewhere in this Warrant):

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR QUALIFIED UNDER ANY APPLICABLE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND QUALIFICATION UNDER SUCH STATE SECURITIES LAWS OR AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION AND/OR QUALIFICATION IS NOT REQUIRED.

 

5. Adjustments and Notices. The Exercise Price and the number of Exercise Shares issuable upon exercise of this Warrant shall be subject to adjustment from time to time in accordance with this Section 5.

 

5.1  Subdivision, Stock Dividends or Combinations . In case the Company shall at any time after the commencement of the Exercise Period subdivide the outstanding Common Stock or shall issue a stock dividend with respect to the Common Stock, the Exercise Price in effect immediately prior to such subdivision or the issuance of such dividend shall be proportionately decreased, and in case the Company shall at any time after the commencement of the Exercise Period combine the outstanding shares of Common Stock, the Exercise Price in effect immediately prior to such combination shall be proportionately increased, in each case effective at the close of business on the date of such subdivision, dividend, or combination, as the case may be.

 

5.2  Reclassification, Exchange, Substitution, In-Kind Distribution . Upon any reclassification, exchange, substitution or other event after the commencement of the Exercise Period that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant or upon the payment after the commencement of the Exercise Period of a dividend in securities or property other than shares of Common Stock, the Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received if this Warrant had been exercised or converted immediately before the record date for such reclassification, exchange, substitution, or other event or immediately prior to the record date for such dividend. The Company or its successor shall promptly issue to Holder a new warrant for such new securities or other property. The new warrant shall provide for adjustments, which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 5, including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise or conversion of the new warrant. The provisions of this Section 5.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events and successive dividends.

 

  

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5.3  Consolidation, Merger, Sale and the Like . In case of any (i) merger or consolidation of the Company into or with another corporation where the Company is not the surviving corporation (but including a merger for the purpose of reincorporating in a new domicile) (ii) sale, transfer or lease (but not including a transfer or lease by pledge or mortgage to a bona fide lender) of all or substantially all of the assets of the Company or (iii) sale by the Company’s stockholders of 50% or more of the Company’s outstanding securities in one or more related transactions, the Company, or such successor or purchasing corporation, as the case may be, shall duly execute and deliver to the Holder hereof a new warrant so that the Holder shall have the right to receive upon exercise or conversion of the unexercised or unconverted portion of this Warrant, at a total purchase price not to exceed that payable upon the exercise or conversion of the unexercised or unconverted portion of this Warrant, and in lieu of shares of Common Stock theretofore issuable upon exercise or conversion of this Warrant, the kind and amount of shares of stock, or other securities, money and other property in lieu of such shares of stock, receivable upon or as a result of such reorganization, merger, or sale by a holder of the number of shares of Common Stock for which this Warrant is exercisable or convertible immediately prior to such event. Such new warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 5. The provisions of this Section 5.3 shall similarly apply to successive reorganizations, mergers, and sales.

 

5.4  Certificate of Adjustment.  In each case of an adjustment or readjustment of the Exercise Price pursuant to this Section 5, the Company, at its expense, shall compute such adjustment or readjustment in accordance with the provisions hereof and prepare a certificate showing such adjustment or readjustment, and shall mail such certificate, by first class mail, postage prepaid, to the Holder at the Holder’s address as shown in the Company’s books. The certificate shall set forth such adjustment or readjustment, showing in reasonable detail the facts upon which such adjustment or readjustment is based, including a statement of, if applicable, the type and amount, if any, of other property which at the time would be received upon exercise of this Warrant.

 

6. Fractional Shares. No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto. All Exercise Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. No payments shall be made by the Company in respect of any fractional shares otherwise issuable pursuant to this Warrant.

 

7. No Stockholder Rights. This Warrant in and of itself shall not entitle the Holder to any voting rights or other rights as a stockholder of the Company.

 

8. Transfer of Warrant. Subject to applicable laws, the restriction on transfer set forth on the first page of this Warrant and in Section 4.4 and the terms of any applicable stockholders, investor rights, or similar agreements, this Warrant and all rights hereunder are transferable, by the Holder in person or by duly authorized attorney, upon delivery of this Warrant and the form of assignment attached hereto to any transferee designated by Holder, provided that the transferee shall have signed an investment letter in form and substance satisfactory to the Company and agreed to be bound by the provisions of this Warrant. Notwithstanding anything to the contrary, no partial transfer of this Warrant shall be permitted.

 

9. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant is lost, stolen, mutilated, or destroyed, the Company may, on such terms as to indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as the Warrant so lost, stolen, mutilated, or destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.

 

  

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10.  Notices, Etc. All notices and other communications required or permitted hereunder shall be in writing and shall be sent by express mail or other form of rapid communications, if possible, and if not then such notice or communication shall be mailed by first-class mail, postage prepaid, addressed in each case to the party entitled thereto at the following addresses: (a) if to the Company, to CrowdGather, Inc., Attention: President, 20300 Ventura Blvd. Suite 330, Woodland Hills, CA 91364, and (b) if to the Holder, to such address as originally furnished to the Company by the Holder, or at such other address as one party may furnish to the other in writing. Notice shall be deemed effective on the date dispatched if by personal delivery, two days after mailing if by express mail, or three days after mailing if by first-class mail.

 

11.  Amendment. This Warrant may be amended or otherwise modified only by a writing signed by the Company and the Holder.

 

12. Acceptance. Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.

 

13.  Governing Law; Forum. This Warrant and all rights, obligations, and liabilities hereunder shall be governed by the internal laws of the State of Nevada and any actions related hereto shall be brought in a court of competent jurisdiction located in the County of Clark, State of Nevada.

 

[NEXT PAGE IS SIGNATURE PAGE]

  

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of the date first written above.

 

 

	  	
CROWDGATHER, INC.

	 
	  	
a Nevada corporation

	 
	  	  	 
	  	  	 
	  	By:	
/s/ Sanjay Sabnani

	 
	  	
Name: Sanjay Sabnani

	 
	  	
Title: President

	 

 

 

 

	
Name of Holder:

	  	 
	  	  	 
	  	  	 
	  	  	 
	
Address:

	  	 
	
Telephone:

	  	 
	
Facsimile:

	  	 

 

  

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NOTICE OF EXERCISE

 

To:           CrowdGather, Inc.

 

1.  The undersigned hereby elects to purchase ________ shares of the Common Stock of CrowdGather, Inc. (the “Company”) pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise price in full pursuant to the terms of Section 2.1 of the attached Warrant, or by net issue exercise pursuant to the terms of Section 2.2 of the attached Warrant, together with all applicable transfer taxes, if any.

 

2.  Please issue a certificate or certificates representing said shares of Common Stock in the name of the undersigned or in such other name as is specified below:

 

	  	
 

	 
	  	
(Name)

	 
	  	 	 
	  	
(Address)

	 

 

3.  The undersigned represents that (i) the aforesaid shares of Common Stock are being acquired for the account of the undersigned for investment purposes only and not with a view to, or for resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares; (ii) the undersigned is aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision regarding its investment in the Company; (iii) the undersigned is experienced in making investments of this type and has such knowledge and background in financial and business matters that the undersigned is capable of evaluating the merits and risks of this investment and protecting the undersigned’s own interests; (iv) the undersigned is an “accredited investor” as defined in Rule 501 under the Securities Act of 1933, as amended (the “ Securities Act ”); (v) the undersigned understands that the shares of Common Stock issuable upon exercise of this Warrant have not been registered under the Securities Act by reason of a specific exemption from the registration provisions of the Securities Act, which exemption depends upon, among other things, the bona fide nature of the investment intent as expressed herein, and, because such securities have not been registered under the Securities Act, they must be held indefinitely unless subsequently registered under the Securities Act or an exemption from such registration is available; (vi) the undersigned is aware that the aforesaid shares of Common Stock may not be sold pursuant to Rule 144 adopted under the Securities Act unless certain conditions are met and until the undersigned has held the shares for the number of years prescribed by Rule 144; and (vii) the undersigned agrees not to make any disposition of all or any part of the aforesaid shares of Common Stock unless and until there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with said registration statement, or the undersigned has provided the Company with an opinion of counsel satisfactory to the Company, stating that such registration is not required.

	
 

	 	
 

	 
	
(Date)

	 	
(Signature)

	 
	  	 	  	 
	  	 	
 

	 
	  	 	
(Print name)

	 

 

 9ex10a.htm

 

 Exhibit 10(a)

 

KAMAN CORPORATION

 

EMPLOYEES STOCK PURCHASE PLAN

 

As Amended and Restated through October 12, 2010

 

Section 1.                      Purpose; Authorized Shares. The Kaman Corporation Employees Stock Purchase Plan (the ‘‘Plan’’) was adopted by the Board of Directors (the ‘‘Board’’) of Kaman Corporation (the ‘‘Corporation’’) on February 28, 1989 for the purpose of providing employees of the Corporation and its subsidiaries an opportunity to purchase Kaman Corporation common stock (the ‘‘Stock’’) through payroll deductions during consecutive offerings commencing July 1, 1989. As of October 13, 2009, an aggregate of 797,904 shares of Stock (the ‘‘Authorized Shares’’) were authorized for purchase by participating employees pursuant to rights granted to participating employees pursuant to the Plan. The Authorized Shares may consist of treasury shares, authorized but unissued shares or shares purchased in the stock market. The Authorized Shares are in addition to all shares purchased for participating employees pursuant to the Plan prior to October 13, 2009.

 

Section 2.                      Offering Periods. Each offering shall be made over a period of one or more whole or partial Plan Years as determined by the Committee (as defined in paragraph 3), provided that in no event shall an offering period be greater than twenty-seven (27) months.

 

Section 3.                      Administration. The Plan will be administered by a committee (the ‘‘Committee’’) appointed by the Board, consisting of at least three of its members. Members of the Committee shall not be eligible to participate in the Plan. The Committee will have authority to make rules and regulations for the administration of the Plan, and its interpretations and decisions with respect to the Plan shall be final and conclusive. Absent some other provision by the Board, the power and responsibilities of the Committee shall be vested in and assumed by the Personnel and Compensation Committee of the Board.

 

Section 4.                      Eligibility. Each employee of the Corporation and each of its designated subsidiaries, who customarily works over twenty (20) hours per week, has at least three (3) months of service and has enrolled in the Plan prior to the commencement of an offering period in the manner prescribed from time to time by the Committee shall be eligible to participate in the Plan as of the commencement of such offering period.  However, the Committee shall neither permit nor deny participation in the Plan contrary to the requirements of the Internal Revenue Code of 1986, as amended (the ‘‘Code’’), including, but not limited to, Section 423 thereof, and regulations promulgated thereunder. To the extent consistent with Code Section 423, any employee who is not eligible to participate in the Plan at the commencement of an offering period may participate in such offering as of the commencement of any calendar quarter during such offering period if such employee is then eligible to participate in the Plan.  The commencement date of such offering period and of any following calendar quarter during such offering period may hereinafter be referred to as an “enrollment date.”  Each eligible employee who has enrolled in the Plan shall be deemed to have been granted a right to purchase shares of Stock as of the enrollment date when such employee’s participation in an offering commences.  No employee may be granted a right under the Plan if such employee, immediately after the right is granted, would own five percent (5%) or more of the total combined voting power or value of all classes of the stock of the Corporation or any subsidiary. For purposes of the preceding sentence, the rules of Section 424(d) of the Code shall apply in determining stock ownership of an employee, and stock which the employee may purchase under outstanding rights shall be treated as stock owned by the employee.

 

  

  

  

 

Section 5.                      Participation. An employee who is otherwise eligible may begin participation in an offering as of an enrollment date by completing and forwarding a Plan ‘‘Enrollment Form’’ to the employee’s appropriate payroll location, or by completing its electronic equivalent, in advance of such enrollment date as directed by the Committee.  By enrolling in the Plan, the employee will authorize a regular payroll deduction from the employee’s compensation, commencing with the next payroll following such employee’s enrollment date.  The employee’s authorization as set forth in the Enrollment Form, or its electronic equivalent, may not be retroactive. Electronic enrollment, any amendments thereto, assignments to joint tenants or other Stock co-owners, and all electronic authorizations are binding on the employee and any such co-owner(s) of Stock received pursuant to the Plan. A participating employee may not modify the rights of a duly designated joint tenant or other such co-owner in a manner adverse to the interests of such joint tenant or other such co-owner without such person’s prior written consent.

 

Section 6.                      Deductions. Payroll deduction transactions will be performed for all participating employees. An employee may authorize a payroll deduction provided that such deduction is (i) not less than One Dollar ($1.00) per payroll period, and (ii) not more than ten (10%) percent of the employee’s annual base salary (plus prior year commissions, if applicable) during any calendar year.

 

Section 7.                      Deduction Changes. An employee may at any time increase or decrease the employee’s payroll deduction by filing a Plan ‘‘Change Form’’, or its electronic equivalent. The change may not become effective sooner than the next pay period after receipt of the Change Form. A payroll deduction may be increased only twice and may be reduced only twice during any Plan Year of an offering period, unless any such additional change is required to permit the purchase of the whole number of shares for which rights have been granted to the employee under the provisions of paragraph 10.

 

Section 8.                      Interest. Since the amount of time that the Corporation will be holding funds withheld from employees’ compensation is minimal, no interest will be credited to employees.

 

Section 9.                      Withdrawal of Funds. An employee may at any time and for any reason permanently withdraw from participation in an offering. Following a withdrawal, the employee will receive the whole shares of Stock that were purchased, and shall also receive in cash the value of any fractional share (rounded to four decimal places) allocated to such employee as determined on the basis of the market value of such fractional share of Stock as soon as practicable following the next purchase of shares pursuant to the Plan. The employee may thereafter begin participation again only once during each Plan Year of an offering period. Partial withdrawals will not be permitted.

 

  

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Section 10.                                Purchase of Shares. In connection with an offering made under the Plan, the Committee shall specify a maximum number of shares of Stock that may be purchased by any employee pursuant to such offering, provided, however, that in the absence of such determination by the Committee, the maximum shall be 5,000 shares.  Subject to the limitation on the maximum number of shares of Stock above, the payroll deduction limitation set forth in paragraph 6 and the limitation below, each employee participating in an offering under this Plan will be granted a right to purchase shares of the Corporation’s common stock which have an aggregate purchase price (determined under paragraph 11) equal to the sum of (a) up to ten percent (10%) of his or her annual base salary (plus prior year commissions, if applicable) during each calendar year of each offering period in which he or she participates, plus (b) any cash dividends reinvested in accordance with paragraph 12. In no event may an employee be granted a right which permits such employee’s rights to purchase stock under this Plan and any other stock purchase plan of the Corporation and its subsidiaries, to accrue at a rate which exceeds $25,000 of fair market value of such stock (as determined at the time the right is granted) for each calendar year in which the right is outstanding at any time.  For the purpose of the limitation imposed by the foregoing sentence, (a) the right to purchase shares of Stock or other stock under a right under the Plan or other employee stock purchase plan accrues when the right (or any portion thereof) first becomes exercisable during the calendar year, (b) the right to purchase shares of Stock or other stock under a right accrues at the rate provided in the right, but in no case may such rate exceed $25,000 of the fair market value of such Stock or other stock (determined at the time such right is granted) for any one calendar year, and (c) a right to purchase Stock or other stock which has accrued under a right may not be carried over to any other right.  The limitation set forth in the two preceding sentences shall be applied in accordance with Section 423(b)(8) of the Code and Treasury Regulations thereunder.  No right may be exercised in any manner other than by payroll deduction as specified in paragraph 6 or dividend reinvestment as specified in paragraph 12.

 

Section 11.                                Purchase Price and Payment. The purchase price to participating employees for each share of common stock purchased under the Plan will be 85% of its market value at the time of purchase.  Purchases of shares pursuant to the Plan shall be made on the fifteenth (15th) day of each month. If the stock market is not open on the 15th of the month, the purchase will be done on the closest day immediately preceding the 15th that the stock market is open. The number of whole and fractional shares allocated to each employee as of each date of purchase shall be based upon the employee’s accumulated payroll deductions for the purchase of shares as of the close of the immediately preceding month. A participating employee’s accumulated payroll deduction balance shall be charged with the purchase price of each whole and fractional share allocated to the employee as of the date of purchase and the employee shall be deemed to have exercised a right to acquire such whole and fractional share as of such date. Additional shares covered by the participating employee’s rights under the Plan will be purchased in the same manner, provided the employee has again accumulated payroll deductions.

 

  

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Section 12.                                Dividends. Any cash dividends paid with respect to the shares held under the Plan shall be paid in cash to the participating employees for whom shares are so held on the basis of the number of whole and fractional shares so held or, if a participating employee so elects, such dividends shall be combined with payroll deductions, added to the funds held under the Plan, and applied to the purchase of additional shares of stock purchased pursuant to the Plan. A participating employee choosing to have dividends reinvested under this paragraph may terminate such election during an offering period by filing a written form, or its electronic equivalent, at the appropriate payroll location, but may thereafter resume his or her election to reinvest such cash dividends only once during each Plan Year of an offering period. An election to either stop or resume dividend reinvestment will be effective with respect to the dividend payment next following receipt of the form; provided that if the form, or its electronic equivalent, is filed within thirty (30) days before a dividend record date declared by the Board, then such election will not be effective with respect to that particular dividend declaration.

 

Section 13.                                Stock Issuances. Shares of the Corporation’s common stock will only be issued to participating employees after their request or after the participating employee’s withdrawal from the Plan for any reason. All shares of the Corporation’s common stock issued pursuant to the Plan shall be issued in uncertificated form subject to the right of any participating employee to request that his or her shares be issued in certificated form, and will be issued as soon as administratively practical.

 

Section 14.                                Registration of Shares. Shares of the Corporation’s common stock may be registered only in the name of the employee, or if the employee so indicates on the Enrollment Form or Change Form, or their respective electronic equivalents, in the employee’s name jointly with a member of the employee’s family (provided that such family member has reached the age of majority), with right of survivorship. An employee who is a resident of a jurisdiction which does not recognize such a joint tenancy may have shares registered in the employee’s name as tenant in common with a member of the employee’s family (provided such family member has reached the age of majority), without right of survivorship.

 

Section 15.                                Definitions. The following terms when used herein shall have the meanings set forth below:

 

(a)           The phrase ‘‘market value’’ or ‘‘fair market value,’’ when used in reference to a purchase of shares of Stock, means the closing price of the Corporation’s common stock in the Over-the-Counter NASDAQ Global Market, as reported in the Hartford, Connecticut local issue of The Wall Street Journal, on the business day immediately preceding the day of purchase or the effective date of the offering as the context requires. The phrase ‘‘market value’’ or ‘‘fair market value,’’ when used in reference to a sale of shares of Stock, means the market price at which the Transfer Agent sells the respective shares of Stock.

 

  

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(b)           The term ‘‘subsidiary’’ means a subsidiary of the Corporation within the meaning of Section 424(f) of the Internal Revenue Code and the regulations thereunder.  The term “designated subsidiary” means (i) each domestic subsidiary, whenever established or acquired, and (ii) each foreign subsidiary that has been designated by the Committee for participation in the Plan.

 

(c)           A ‘‘Plan Year’’ means the calendar year.

 

Section 16.                                Shareholder Status. None of the privileges of a shareholder of the Corporation shall exist with respect to (a) rights granted to a participating employee under the Plan or, (b) except as provided in paragraph 12, any fractional shares credited to the participating employee.

 

Section 17.                                Retirement, Death or Termination of Employment. In the event of a participating employee’s retirement, death or termination of employment, no payroll deduction shall be taken from any pay due and owing to an employee at such time, and either (i) the balance of the employee’s shares purchased under the Plan (including the cash value of any fractional shares calculated in the manner described in paragraph 9) shall be delivered to the employee or, in the event of the employee’s death, to the employee’s beneficiary, or (ii) the employee or such beneficiary may elect to receive the cash value of such shares by directing the shares to be sold and the proceeds received in such sale to be paid to the employee or such beneficiary, minus any applicable fees; provided, however, that in the event shares credited to a deceased employee would have been issued to the employee and a joint tenant with right of survivorship as permitted in paragraph 14 if such shares were issued immediately prior to such employee’s death, then such shares shall be issued to such joint tenant if he or she is living at the time such shares are issued.

 

A participating employee may designate a beneficiary by completing and forwarding a beneficiary designation form to the employee’s appropriate payroll location, or completing its electronic equivalent. Except where a participating employee has designated that shares allocated to such employee are to be registered in the name of the employee and a family member as joint tenants with rights of survivorship, and such family member survives the employee upon the employee’s death, the Corporation shall transfer to the beneficiary all shares then allocated to the employee under the Plan. In the case of shares to be registered in the name of the employee and a tenant in common, the beneficiary shall only receive the employee’s interest in such shares. The Corporation shall also transfer to the beneficiary the employee’s remaining accumulated payroll deductions at the time of the employee’s death.

 

If the employee has no beneficiary designated, or if the beneficiary predeceased the employee, the employee’s estate shall be deemed to be the employee’s beneficiary.

 

  

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Section 18.                                Rights Not Transferable. Rights under this Plan are not transferable by a participating employee other than by will or the laws of descent and distribution, and are exercisable during an employee’s lifetime only by the employee.  Procedures to be followed in the event of the death of a participant are set forth in Section 17 above.

 

Section 19.                                Application of Funds. All funds received or held by the Corporation under this Plan may be used for any corporate purpose.

 

Section 20.                                Adjustment in Cases of Changes Affecting Common Stock. In the event of any merger, consolidation, reorganization, recapitalization, stock dividend, combination, issuance of rights, split-up or spinoff of the Corporation, or the like, the number of shares approved for this Plan shall be increased appropriately and such other adjustments to the terms of this Plan shall be made as may be deemed equitable by the Board. In the event of any other change affecting such stock, such adjustments shall be made as may be deemed equitable by the Board to give proper effect to such event.  No adjustment or action described in this Section 20 or in any other provision of the Plan shall be authorized to the extent that such adjustment or action would cause the Plan to fail to satisfy the requirements of Section 423 of the Code.

 

Section 21.                                Amendment of the Plan. The Board may at any time, or from time to time, amend this Plan in any respect, except that, without the approval of a majority of the voting power of all shares of the Corporation then issued and outstanding and entitled to vote on the matter by applicable law, or such further shareholder approval as may be needed to comply with the requirements of Section 423 of the Code, no amendment shall be made (i) increasing the aggregate number of shares that may be issued under the Plan (other than as provided in paragraph 20); (ii) decreasing the purchase price per share; (iii) withdrawing the administration of this Plan from the Committee; (iv) changing the designation of subsidiaries eligible to participate in the Plan, except adding a subsidiary as provided in paragraph 15(b); (v) changing the corporation that grants the rights; or (vi) changing the class of stock available for purchase under the Plan.

 

Section 22.                                Termination of Plan. This Plan and all rights of employees under an offering hereunder shall terminate:

 

(a)           on the date that participating employees’ accumulated payroll deductions pursuant to paragraph 6 and amounts reinvested pursuant to paragraph 12 are sufficient to purchase a number of shares equal to or greater than the number of shares remaining available for purchase and all such available shares have been purchased. If the number of shares so purchasable is greater than the shares remaining available, the available shares shall be allocated by the Committee among such participating employees in such manner as it deems equitable, or

 

(b) at any time at the discretion of the Board.

 

  

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Upon termination of the Plan all accumulated payroll deductions of participating employees not applied to the purchase of shares hereunder shall be promptly refunded.

 

Section 23.                                Government Regulations. The Corporation’s obligation to sell and deliver shares of its common stock under this Plan is subject to the approval of any governmental authority required in connection with the authorization, issuance or sale of such stock.

 

Section 24.                                Shares Used to Fund Plan. The Corporation may utilize unissued shares to fund the Plan.  Purchases of outstanding shares may also be made pursuant to and on behalf of the Plan, upon such terms as the Corporation may approve, for delivery under the Plan.

 

Section 25.                                Qualified Plan. This Plan is intended to qualify as an Employee Stock Purchase Plan as defined in Section 423 of the Code. The term ‘‘right’’ as used herein shall mean ‘‘option’’ as used in Section 423, and is used herein only to avoid confusion with ‘‘options’’ granted under the Kaman Corporation 2003 Stock Incentive Plan.  All employees eligible to participate in the Plan or an offering under the Plan, shall have equal rights and privileges under the Plan, or the offering under the Plan, as applicable, to the extent required by Section 423 of the Code and Treasury Regulations thereunder so that the Plan qualifies as an “employee stock purchase plan” within the meaning of Section 423 of the Code or applicable Treasury Regulations thereunder.  Any provision of the Plan that is inconsistent with Section 423 of the Code or applicable Treasury Regulations shall, without further act or amendment by the Corporation or the Board or the Committee, be reformed to comply with the equal rights and privileges requirement of Section 423 of the Code or applicable Treasury Regulations thereunder.

 

Section 26.                                Successor Corporation. The rights and obligations of the Corporation under this Plan shall inure to and be binding upon any successor to all or substantially all of the Corporation’s assets and business.

 

Section 27.                                Business Days. If any event provided for in this Plan is scheduled to take place on a day which is not a business day then such event shall take place on the immediately preceding business day.

 

 

Section 28.                      Foreign Subsidiaries. The Committee may set terms and conditions under this Plan that the Committee determines are necessary to comply with applicable foreign laws or advisable in light of such laws, as well as take any action it deems advisable to obtain approval of this Plan and its terms by an appropriate foreign governmental entity; provided, however, that no such terms and conditions may be set nor action may be taken that would result in a violation of the United States laws applicable to the Corporation, including, without limitation, the Securities Exchange Act of 1934, as amended, or that would cause this Plan to fail to qualify as an employee stock purchase plan within the meaning of Section 423 of the Code for participating employees located in the United States.

 

  

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