Document:

ex10-1.htm

    
      
        EXHIBIT 10.1  

      

    

     

    URS
CORPORATION

     

    2008
EQUITY INCENTIVE PLAN

     

    Adopted
By Board of Directors: March 27, 2008

    Approved
By Stockholders: May 22, 2008

    Amended
By Board of Directors: May 22, 2008

    Amended
By Board of Directors: May 26, 2010

    Termination
Date: May 22, 2013

     

    1. General.

     

    (a) Eligible Award
Recipients.  The persons eligible to receive Awards are
Employees, Directors and Consultants.

     

    (b) Available
Awards.  The Plan provides for the grant of the following
Awards: (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii)
Restricted Stock Awards, (iv) Restricted Stock Unit Awards, (v) Non-Executive
Director Stock Awards, (v) Performance Stock Awards, (vi) Performance Cash
Awards, and (vii) Other Stock Awards.

     

    (c) General
Purpose.  The Company, by means of the Plan, seeks to secure
and retain the services of the group of persons eligible to receive Awards, to
provide incentives for such persons to exert maximum efforts for the success of
the Company and its Affiliates and to provide a means by which such eligible
recipients may be given an opportunity to benefit from increases in value of the
Common Stock through the granting of Stock Awards.

     

    2. Definitions.   As
used in the Plan, the definitions contained in this Section 2 shall apply to the
capitalized terms indicated below:

     

    (a) “Affiliate”
means, at the time of determination, any “parent” or “subsidiary” of the Company
as such terms are defined in Rule 405 of the Securities Act.  The
Board shall have the authority to determine the time or times at which “parent”
or “subsidiary” status is determined within the foregoing
definition.

     

    (b) “Award”
means a Stock Award or a Performance Cash Award.

     

    (c) “Board”
means the Board of Directors of the Company.

     

    (d) “Capitalization
Adjustment” means any change that is made in, or other events that occur
with respect to, the Common Stock subject to the Plan or subject to any Stock
Award after the Effective Date without the receipt of consideration by the
Company (through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of shares, exchange of shares, change
in corporate structure or other transaction not involving the receipt of
consideration by the Company.  Notwithstanding the foregoing, the
conversion of any

     

    
      
         

      

      
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    convertible
securities of the Company shall not be treated as a transaction “without receipt
of consideration” by the Company.

     

    (e) “Change in
Control” means any transaction, or series of transactions that occur
within a twelve (12) month period, as a result of which the stockholders of the
Company immediately prior to the completion of the transaction (or, in the case
of a series of transactions, immediately prior to the first transaction in the
series) hold, directly or indirectly, less than fifty percent (50%) of the
beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act or
comparable successor rules) of the outstanding securities of the surviving
entity, or, if more than one entity survives the transaction or transactions,
the controlling entity, following such transaction or transactions.

     

    (f) “Code”
means the Internal Revenue Code of 1986, as amended.

     

    (g) “Committee”
means a committee of one (1) or more Directors to whom authority has been
delegated by the Board in accordance with Section 3(c).

     

    (h) “Common
Stock” means the common stock of the Company.

     

    (i) “Company”
means URS Corporation, a Delaware corporation.

     

    (j) “Consultant”
means any person, including an advisor, who is (i) engaged by the Company or an
Affiliate to render consulting or advisory services and is compensated for such
services, or (ii) serving as a member of the board of directors of an Affiliate
and is compensated for such services.  However, service solely as a
Director, or payment of a fee for such service, shall not cause a Director to be
considered a “Consultant” for purposes of the Plan.

     

    (k) “Continuous
Service” means that the Participant’s service with the Company or an
Affiliate, whether as an Employee, Director or Consultant, is not interrupted or
terminated.  The Participant’s Continuous Service shall not be deemed
to have terminated merely because of a change in the capacity in which the
Participant renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the Participant
renders such service, provided that there is no interruption or termination of
the Participant’s Continuous Service.  For example, a change in status
from an employee of the Company to a consultant to an Affiliate or to a Director
shall not constitute an interruption of Continuous Service.  To the
extent permitted by law, the Board or the chief executive officer of the
Company, in that party’s sole discretion, may determine whether Continuous
Service shall be considered interrupted in the case of any leave of absence
approved by that party, including sick leave, military leave or any other
personal leave.  Notwithstanding the foregoing, a leave of absence
shall be treated as Continuous Service for purposes of vesting in a Stock Award
only to such extent as may be provided in the Company’s leave of absence policy,
in the written terms of any leave of absence agreement or policy applicable to
the Participant, or as otherwise required by law.

     

    (l) “Covered
Employee” shall have the meaning provided in Section 162(m)(3) of the
Code and the regulations promulgated thereunder.

     

    
      
         

      

      
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    (m) “Director”
means a member of the Board.

     

    (n) “Disability”
means, with respect to a Participant, the inability of such Participant to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than twelve
(12) months, as provided in Section 22(e)(3) and 409A(a)(2)(c)(i) of the
Code.

     

    (o) “Effective
Date” means the
effective date of this Plan document, which is the date of the annual meeting of
stockholders of the Company held in 2008, provided this Plan is approved by the
Company’s stockholders at such meeting.

     

    (p) “Employee”
means any person employed by the Company or an Affiliate.  However,
service solely as a Director, or payment of a fee for such services, shall not
cause a Director to be considered an “Employee” for purposes of the
Plan.

     

    (q) “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

     

    (r) “Fair Market
Value” means, as of any date, the value of the Common Stock determined as
follows:

     

    (i) If the
Common Stock is listed on any established stock exchange or traded on any
established market, the Fair Market Value of a share of Common Stock shall be
the closing sales price for such stock (or the closing bid, if no sales were
reported) as quoted on such exchange or market (or the exchange or market with
the greatest volume of trading in the Common Stock) on the last market trading
day prior to the day of determination, as reported in The Wall Street Journal or
such other source as the Board deems reliable.

     

    (ii) In the
absence of such markets for the Common Stock, the Fair Market Value shall be
determined by the Board in good faith.

     

    (s) “Incentive Stock
Option” means an option granted pursuant to Section 6 that is intended to
be, and qualifies as, an “incentive stock option” within the meaning of
Section 422 of the Code and the regulations promulgated
thereunder.

     

    (t) “Non-Employee
Director” means a Director who
either (i) is not a current employee or officer of the Company or an Affiliate,
does not receive compensation, either directly or indirectly, from the Company
or an Affiliate for services rendered as a consultant or in any capacity other
than as a Director (except for an amount as to which disclosure would not be
required under Item 404(a) of Regulation S-K promulgated pursuant to the
Securities Act (“Regulation
S-K”)), does not possess an interest in any other transaction for which
disclosure would be required under Item 404(a) of Regulation S-K, and is not
engaged in a business relationship for which disclosure would be required
pursuant to Item 404(b) of Regulation S-K; or (ii) is otherwise considered
a “non-employee director” for purposes of Rule 16b-3.

     

    (u) “Non-Executive
Director” means a Director who is not an Employee.

     

    
      
         

      

      
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    (v) “Non-Executive
Director Stock Award” means a Stock Award made to a Non-Executive
Director pursuant to Section 9.

     

    (w) “Nonstatutory
Stock Option” means an option granted pursuant to Section 6 that does not
qualify as an Incentive Stock Option.

     

    (x) “Officer”
means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder.

     

    (y) “Option”
means an Incentive Stock Option or a Nonstatutory Stock Option granted pursuant
to Section 6.

     

    (z) “Option
Agreement” means a written agreement between the Company and an
Optionholder evidencing the terms and conditions of an individual Option
grant.  Each Option Agreement shall be subject to the terms and
conditions of the Plan.

     

    (aa) “Optionholder”
means a person to whom an Option is granted pursuant to the Plan or, if
permitted under the terms of this Plan, such other person who holds an
outstanding Option.

     

    (bb) “Other Stock
Award” means an award based in whole or in part by reference to the
Common Stock which is granted pursuant to the terms and conditions of Section
11.

     

    (cc) “Other Stock
Award Agreement” means a written agreement between the Company and a
holder of an Other Stock Award evidencing the terms and conditions of an Other
Stock Award grant.  Each Other Stock Award Agreement shall be subject
to the terms and conditions of the Plan.

     

    (dd) “Outside
Director” means a Director who either (i) is not a current employee of
the Company or an “affiliated corporation” (within the meaning of Treasury
Regulations promulgated under Section 162(m) of the Code), is not a former
employee of the Company or an “affiliated corporation” who receives compensation
for prior services (other than benefits under a tax-qualified retirement plan)
during the taxable year, has not been an officer of the Company or an
“affiliated corporation,” and does not receive remuneration from the Company or
an “affiliated corporation,” either directly or indirectly, in any capacity
other than as a Director, or (ii) is otherwise considered an “outside director”
for purposes of Section 162(m) of the Code.

     

    (ee) “Participant”
means a person to whom an Award is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding Award.

     

    (ff) “Performance Cash
Award” means an award of cash granted pursuant to Section
10(b).

     

    (gg) “Performance
Criteria” means the one or more criteria that the Board shall select for
purposes of establishing the Performance Goals for a Performance
Period.  The Performance Criteria that shall be used to establish such
Performance Goals may be based on any one of, or combination of, or any ratio
between two or more of, the following: (i) earnings before interest, taxes,
depreciation and amortization (“EBITDA”); (ii) earnings before interest and
taxes

     

    
      
         

      

      
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    (“EBIT”);
(iii) earnings before unusual or nonrecurring items; (iv) net earnings; (v)
earnings per share; (vi) net income; (vii) gross profit margin; (viii) operating
margin; (ix) operating income; (x) net operating income; (xi) net operating
income after taxes; (xii) growth; (xiii) net worth; (xiv) cash flow; (xv) cash
flow per share; (xvi) total stockholder return; (xvii) return on capital;
(xviii) stock price performance; (xix) revenues; (xx) costs; (xxi) working
capital; (xxii) capital expenditures; (xxiii) changes in capital structure;
(xxiv) economic value added; (xxv) industry indices; (xxvi) expenses and expense
ratio management; (xxvii) debt reduction; (xxviii) profitability of an
identifiable business unit or product; (xxix) levels of expense, cost or
liability by category, operating unit or any other delineation; (xxx)
implementation or completion of projects or processes; (xxxi) contribution;
(xxxii) average days sales outstanding; (xxxiii) new sales; and (xxxiv) to the
extent that a Performance Stock Award or a Performance Cash Award is not
intended to comply with Section 162(m) of the Code, other measures of
performance selected by the Board.  Partial achievement of the
specified criteria may result in the payment or vesting corresponding to the
degree of achievement as specified in the Stock Award Agreement or the written
terms of a Performance Cash Award.  The Board shall, in its sole
discretion, define the manner of calculating the Performance Criteria it selects
to use for a Performance Period.

     

    (hh) “Performance
Goals” means, for a Performance Period, the one or more goals established
by the Board for the Performance Period based upon the Performance
Criteria.    Performance Goals may be set on a Company-wide
basis, with respect to one or more business units, divisions, Affiliates, or
business segments, and in either absolute terms or relative to other Performance
Criteria or internally generated business plans approved by the Board, the
performance of one or more comparable companies or a relevant
index.  The Board is authorized to make adjustments in the method of
calculating the attainment of Performance Goals for a Performance Period as
follows: (i) to exclude restructuring and/or other nonrecurring charges; (ii) to
exclude exchange rate effects, as applicable, for non-U.S. dollar denominated
net sales and operating earnings; (iii) to exclude the effects of changes to
generally accepted accounting standards required by the Financial Accounting
Standards Board; (iv) to exclude the effects of any statutory adjustments to
corporate tax rates; (v) to exclude the effects of any “extraordinary items” as
determined under generally accepted accounting principles; (vi) to exclude any
other unusual, non-recurring gain or loss or other extraordinary item; (vii) to
respond to, or in anticipation of, any unusual or extraordinary corporate item,
transaction, event or development; (viii) to respond to, or in anticipation of,
changes in applicable laws, regulations, accounting principles, or business
conditions; (ix) to exclude the dilutive effects of acquisitions or joint
ventures; (x) to assume that any business divested by the Company achieved
performance objectives at targeted levels during the balance of a Performance
Period following such divestiture; (xi) to exclude the effect of any change in
the outstanding shares of common stock of the Company by reason of any stock
dividend or split, stock repurchase, reorganization, recapitalization, merger,
consolidation, spin-off, combination or exchange of shares or other similar
corporate change, or any distributions to common shareholders other than regular
cash dividends; (xii) to reflect a corporate transaction, such as a merger,
consolidation, separation (including a spinoff or other distribution of stock or
property by a corporation), or reorganization (whether or not such
reorganization comes within the definition of such term in Section 368 of the
Code); and (xiii) to reflect any partial or complete corporate
liquidation.  The Board also retains the discretion to reduce or
eliminate the compensation or economic benefit due upon attainment of
Performance Goals.

     

    
      
         

      

      
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    (ii) “Performance
Period” means the one or more periods of time, which may be of varying
and overlapping durations, as the Board may select, over which the attainment of
one or more Performance Goals will be measured for the purpose of determining a
Participant’s right to and the payment of a Performance Stock Award or a
Performance Cash Award.

     

    (jj) “Performance
Stock Award” means a Stock Award granted pursuant to Section
10(a).

     

    (kk) “Plan”
means this URS Corporation 2008 Equity Incentive Plan.

     

    (ll) “Restricted Stock
Award” means an award of shares of Common Stock which is granted pursuant
to Section 7.

     

    (mm) “Restricted Stock
Award Agreement” means a written agreement between the Company and a
holder of a Restricted Stock Award evidencing the terms and conditions of a
Restricted Stock Award grant.  Each Restricted Stock Award Agreement
shall be subject to the terms and conditions of the Plan.

     

    (nn) “Restricted Stock
Unit Award” means a right to receive shares of Common Stock which is
granted pursuant to Section 8.

     

    (oo) “Restricted Stock
Unit Award Agreement” means a written agreement between the Company and a
holder of a Restricted Stock Unit Award evidencing the terms and conditions of a
Restricted Stock Unit Award grant.  Each Restricted Stock Unit Award
Agreement shall be subject to the terms and conditions of the Plan.

     

    (pp)  “Retirement”
means the termination of a Participant’s Continuous Service by retirement
as determined in accordance with the Company’s then current employment policies
and guidelines.

     

    (qq) “Rule
16b-3” means Rule 16b-3 promulgated under the Exchange Act or any
successor to Rule 16b-3, as in effect from time to time.

     

    (rr) “Securities
Act” means the Securities Act of 1933, as amended.

     

    (ss) “Stock
Award” means any right to receive Common Stock granted under the Plan,
including an Option, a Restricted Stock Award, a Restricted Stock Unit Award, a
Non-Executive Director Stock Award, a Performance Stock Award or any Other Stock
Award.

     

    (tt) “Stock Award
Agreement” means a written agreement between the Company and a
Participant evidencing the terms and conditions of an individual Stock Award
grant.  Each Stock Award Agreement shall be subject to the terms and
conditions of the Plan.

     

    (uu) “Ten Percent
Stockholder” means a person who owns (or is deemed to own pursuant to
Section 424(d) of the Code) stock possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or of any of
its Affiliates.

     

    
      
         

      

      
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    3. Administration.

     

    (a) Administration by
Board.  The Board shall administer the Plan unless and until
the Board delegates administration to a Committee or Committees, as provided in
Section 3(c).

     

    (b) Powers of
Board.  The Board shall have the power, subject to, and within
the limitations of, the express provisions of the Plan:

     

    (i) To
determine from time to time (A) which of the persons eligible under the Plan
shall be granted Awards; (B) when and how each Award shall be granted; (C) what
type or combination of types of Awards shall be granted; (D) the provisions of
each Award granted (which need not be identical), including the time or times
when a person shall be permitted to receive cash or Common Stock pursuant to an
Award; and (E) the number of shares of Common Stock with respect to which a
Stock Award shall be granted to each such person.

     

    (ii) To
construe and interpret the Plan and Awards, and to establish, amend and revoke
rules and regulations for the Plan’s administration.  The Board, in
the exercise of this power, may correct any defect, omission or inconsistency in
the Plan or in any Stock Award Agreement or in the written terms of a
Performance Cash Award, in a manner and to the extent it shall deem necessary or
expedient to make the Plan or Award fully effective.

     

    (iii) To settle
all controversies regarding the Plan and Awards.

     

    (iv) To
accelerate the time at which a Stock Award may first be exercised or the time
during which an Award or any part thereof will vest in accordance with the Plan,
notwithstanding the provisions in the Award stating the time at which it may
first be exercised or the time during which it will vest; provided, however, that the
exercisability or vesting of any Award may only be accelerated in the event of a
Participant’s death, Disability or Retirement or upon a Change in Control; provided further, however,
that up to 5% of the shares reserved for issuance under the Plan pursuant to
Section 4(a) may be subject to Awards which do not meet the preceding
acceleration restrictions.

     

    (v) To
suspend or terminate the Plan at any time.  Suspension or termination
of the Plan shall not impair rights and obligations under any Stock Award
granted while the Plan is in effect except with the written consent of the
affected Participant.

     

    (vi) To amend
the Plan in any respect the Board deems necessary or advisable, including,
without limitation, relating to Incentive Stock Options and certain nonqualified
deferred compensation under Section 409A of the Code and to bring the Plan
and/or Stock Awards into compliance therewith, subject to the limitations, if
any, of applicable law.  However, except as provided in Section 14(a)
relating to Capitalization Adjustments, stockholder approval shall be required
for any amendment of the Plan that either (A) materially increases the number of
shares of Common Stock available for issuance under the Plan, (B) materially
expands the class of individuals eligible to receive Awards under the Plan, (C)
materially increases the benefits accruing to Participants under the Plan or
materially reduces the price at which shares of Common Stock may be issued or
purchased under the Plan, (D) materially extends the term of the Plan, or (E)
expands the types of Awards available for issuance under the

     

    
      
         

      

      
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    Plan, but
only to the extent required by applicable law or listing requirements. Except as
provided above, rights under any Award granted before amendment of the Plan
shall not be impaired by any amendment of the Plan unless (1) the Company
requests the consent of the affected Participant, and (2) such Participant
consents in writing.

     

    (vii) To submit
any amendment to the Plan for stockholder approval, including, but not limited
to, amendments to the Plan intended to satisfy the requirements of (A) Section
162(m) of the Code and the regulations thereunder regarding the exclusion of
performance-based compensation from the limit on corporate deductibility of
compensation paid to Covered Employees, (B) Section 422 of the Code regarding
“incentive stock options” or (C) Rule 16b-3.

     

    (viii) To
approve forms of Award Agreements for use under the Plan and to amend the terms
of any one or more Awards, including, but not limited to, amendments to provide
terms more favorable to the Participant than previously provided in the Award
Agreement, subject to any specified limits in the Plan that are not subject to
Board discretion; provided
however, that the Participant’s rights under any Award shall not be
impaired by any such amendment unless (A) the Company requests the consent of
the affected Participant, and (B) such Participant consents in
writing.  Notwithstanding the foregoing, subject to the limitations of
applicable law, if any, and without the affected Participant’s consent, the
Board may amend the terms of any one or more Awards if necessary to maintain the
qualified status of the Award as an Incentive Stock Option or to bring the Award
into compliance with Section 409A of the Code and Department of Treasury
regulations and other interpretive guidance issued thereunder, including without
limitation any such regulations or other guidance that may be issued or amended
after the Effective Date.

     

    (ix) Generally,
to exercise such powers and to perform such acts as the Board deems necessary or
expedient to promote the best interests of the Company and that are not in
conflict with the provisions of the Plan or Awards.

     

    (x) To adopt
such procedures and sub-plans as are necessary or appropriate to permit
participation in the Plan by Employees, Directors or Consultants who are foreign
nationals or employed outside the United States.

     

    (c) Delegation
to Committee.

     

    (i) General.  Subject to
the limitation set forth in Section 3(c)(ii), the Board may delegate some or all
of the administration of the Plan to a Committee or Committees.  If
administration of the Plan is delegated to a Committee, the Committee shall
have, in connection with the administration of the Plan, the powers theretofore
possessed by the Board that have been delegated to the Committee, including the
power to delegate to a subcommittee of the Committee any of the administrative
powers the Committee is authorized to exercise (and references in this Plan to
the Board shall thereafter be to the Committee or subcommittee), subject,
however, to such resolutions, not inconsistent with the provisions of the Plan,
as may be adopted from time to time by the Board.  The Board may
retain the authority to concurrently administer the Plan with the Committee and
may, at any time, revest in the Board some or all of the powers previously
delegated to the Committee, Committees, subcommittee or
subcommittees.

     

    
      
         

      

      
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    (ii) Limitation on
Delegation.  Notwithstanding anything to the contrary in
Section 3(c)(i), the Board may not delegate the administration of the Plan to a
Committee to the extent such administration would in any way affect
Non-Executive Director Stock Awards described in Section 9.

     

    (iii) Committee
Composition.  In the sole discretion of the Board, the
Committee may consist solely of two (2) or more Outside Directors, in accordance
with Section 162(m) of the Code, or solely of two (2) or more Non-Employee
Directors, in accordance with Rule 16b-3.  In addition, the Board or
the Committee, in its sole discretion, may (A) delegate to a Committee which
need not consist of Outside Directors the authority to grant Awards to eligible
persons who are either (1) not then Covered Employees and are not expected to be
Covered Employees at the time of recognition of income resulting from such Stock
Award, or (2) not persons with respect to whom the Company wishes to comply with
Section 162(m) of the Code, or (B) delegate to a Committee which need not
consist of Non-Employee Directors the authority to grant Stock Awards to
eligible persons who are not then subject to Section 16 of the Exchange
Act.  Notwithstanding the foregoing or any other provision of the Plan
to the contrary, any Award granted to a Non-Executive Director, other than a
Non-Executive Director Stock Award pursuant to Section 9, shall be granted by a
Committee consisting solely of two (2) or more Outside Directors or Non-Employee
Directors.

     

    (d) Delegation to an
Officer.  The Board may delegate to one (1) or more Officers
the authority to do one or both of the following (i) designate Employees who are
not Officers to be recipients of Options (and, to the extent permitted by
applicable law, other Stock Awards) and the terms thereof, and (ii) determine
the number of shares of Common Stock to be subject to such Stock Awards granted
to such Employees; provided,
however, that the Board
resolutions regarding such delegation shall specify the total number of shares
of Common Stock that may be subject to the Stock Awards granted by such Officer
and that such Officer may not grant a Stock Award to himself or
herself.  Notwithstanding anything to the contrary in this Section
3(d), the Board may not delegate to an Officer authority to determine the Fair
Market Value pursuant to Section 2(r)(ii).

     

    (e) Effect of Board’s Decision.
All determinations, interpretations and constructions made by the Board in good
faith shall not be subject to review by any person and shall be final, binding
and conclusive on all persons.

     

    (f) Cancellation and Re-Grant of Stock
Awards.  Neither the Board nor any Committee shall have the
authority to: (i) reprice any outstanding Stock Awards under the Plan, or (ii)
cancel and re-grant any outstanding Stock Awards under the Plan, unless the
stockholders of the Company have approved such an action within twelve (12)
months prior to such an event.

     

    4. Shares
Subject to the Plan.

     

    (a) Share
Reserve.  Subject to the provisions of Section 14(a) relating
to Capitalization Adjustments, the aggregate number of shares of Common Stock
that may be issued pursuant to Stock Awards after the Effective Date shall not
exceed five million (5,000,000) shares.  For clarity, the limitation
in this Section 4(a) is a limitation on the number of

     

    
      
         

      

      
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    shares of
Common Stock that may be issued pursuant to the Plan.  Accordingly,
this Section 4(a) does not limit the granting of Stock Awards except as provided
in Section 12(a).

     

    Shares
may be issued in connection with a merger or acquisition as permitted by NYSE
Listed Company Manual Section 303A.08 or, if applicable, NASD Rule
4350(i)(1)(A)(iii) or AMEX Company Guide Section 711, and such issuance shall
not reduce the number of shares available for issuance under the
Plan.  Furthermore, if a Stock Award (i) expires or otherwise
terminates without having been exercised in full or (ii) is settled in cash
(i.e., the holder of
the Stock Award receives cash rather than stock), such expiration, termination
or settlement shall not reduce (or otherwise offset) the number of shares Common
Stock that may be issued pursuant to the Plan

     

    (b) Reversion of Shares to the Share
Reserve.  If any shares of common stock issued pursuant to a
Stock Award are forfeited back to the Company because of the failure to meet a
contingency or condition required to vest such shares in the Participant, then
the shares which are forfeited shall revert to and again become available for
issuance under the Plan.  Also, any shares reacquired by the Company
pursuant to Section 13(g) or as consideration for the exercise of an Option
shall again become available for issuance under the
Plan.  Notwithstanding the provisions of this Section 4(b), any such
shares shall not be subsequently issued pursuant to the exercise of Incentive
Stock Options.  

     

    (c) Incentive Stock Option
Limit.  Notwithstanding anything to the contrary in this
Section 4(d), subject to the provisions of Section 14(a) relating to
Capitalization Adjustments, the aggregate maximum number of shares of Common
Stock that may be issued pursuant to the exercise of Incentive Stock Options
shall be five million (5,000,000) shares. 

     

    (d) Source of
Shares.  The stock issuable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares repurchased
by the Company on the market or otherwise.

     

    5. Eligibility.

     

    (a) Eligibility for Specific
Awards.  Incentive Stock Options may be granted only to
employees of the Company or a parent corporation or subsidiary corporation (as
such terms are defined in Sections 424(e) and (f) of the Code).  Stock
Awards other than Incentive Stock Options may be granted to Employees, Directors
and Consultants.  Non-Executive Director Stock Awards may be granted
only to Non-Executive Directors and only pursuant to the formula set forth in
Section 9.  Performance Cash Awards may be granted to Employees,
Directors and Consultants.

     

    (b) Ten Percent
Stockholders.  A Ten Percent Stockholder shall not be granted
an Incentive Stock Option unless the exercise price of such Option is at least
one hundred ten percent (110%) of the Fair Market Value of the Common Stock on
the date of grant and the Option is not exercisable after the expiration of five
(5) years from the date of grant.

     

    (c) Consultants.   A
Consultant shall be eligible for the grant of a Stock Award only if, at the time
of grant, a Form S-8 Registration Statement under the Securities Act (“Form
S-8”)

     

    
      
         

      

      
        x

        
          

        

      

      
         

      

    

    is
available to register either the offer or the sale of the Company’s securities
to such Consultant because of the nature of the services that the Consultant is
providing to the Company, because the Consultant is a natural person, or because
of any other rule governing the use of Form S-8.

     

    (d) Section 162(m)
Limitation.  Subject to the provisions of Section 14(a)
relating to Capitalization Adjustments, at such time as the Company may be
subject to the applicable provisions of Section 162(m) of the Code, no Employee
shall be eligible to be granted during any fiscal year of the Company (i)
Options or Performance Stock Awards covering more than one million
(1,000,000) shares
of Common Stock or (ii) Performance Cash Awards with a value in excess of five
million dollars ($5,000,000).

     

    6. Option
Provisions.

     

    Each
Option shall be in such form and shall contain such terms and conditions as the
Board shall deem appropriate.  All Options shall be separately
designated Incentive Stock Options or Nonstatutory Stock Options at the time of
grant, and, if certificates are issued, a separate certificate or certificates
shall be issued for shares of Common Stock purchased on exercise of each type of
Option. If an Option is not specifically designated as an Incentive Stock
Option, then the Option shall be a Nonstatutory Stock Option. The provisions of
separate Options need not be identical; provided, however, that each
Option Agreement shall include (through incorporation of provisions hereof by
reference in the Option Agreement or otherwise) the substance of each of the
following provisions:

     

    (a) Term.  Subject to
the provisions of Section 5(b) regarding Ten Percent Stockholders, no Option
shall be exercisable after the expiration of ten (10) years from the date of its
grant or such shorter period specified in the Option Agreement.

     

    (b) Exercise
Price.  Subject to the provisions of Section ‎5(b)
regarding Ten Percent Stockholders, the exercise price of each Option shall be
not less than one hundred percent (100%) of the Fair Market Value of the Common
Stock subject to the Option on the date the Option is
granted.  Notwithstanding the foregoing, an Option may be granted with
an exercise price lower than one hundred percent (100%) of the Fair Market Value
of the Common Stock subject to the Option if such Option is granted pursuant to
an assumption of or substitution for another option in a manner consistent with
the provisions of Section 424(a) of the Code (whether or not such options are
Incentive Stock Options).

     

    (c) Consideration.  The
purchase price of Common Stock acquired pursuant to the exercise of an Option
shall be paid, to the extent permitted by applicable law and as determined by
the Board in its sole discretion, by any combination of the methods of payment
set forth below.  The Board shall have the authority to grant Options
that do not permit all of the following methods of payment (or otherwise
restrict the ability to use certain methods) and to grant Options that require
the consent of the Company to utilize a particular method of
payment.  The methods of payment permitted by this Section 6(c)
are:

     

    (i) by cash,
check, bank draft or money order payable to the Company;

     

    
      
         

      

      
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    (ii) pursuant
to a program developed under Regulation T as promulgated by the Federal Reserve
Board that, prior to the issuance of the stock subject to the Option, results in
either the receipt of cash (or check) by the Company or the receipt of
irrevocable instructions to pay the aggregate exercise price to the Company from
the sales proceeds;

     

    (iii) by
delivery to the Company (either by actual delivery or attestation) of shares of
Common Stock;

     

    (iv) by a “net
exercise” arrangement pursuant to which the Company will reduce the number of
shares of Common Stock issued upon exercise by the largest whole number of
shares with a Fair Market Value that does not exceed the aggregate exercise
price; provided,
however, that the Company shall accept a cash or other payment from the
Participant to the extent of any remaining balance of the aggregate exercise
price not satisfied by such reduction in the number of whole shares to be
issued; provided,
further, that shares of Common Stock will no longer be outstanding under
an Option and will not be exercisable thereafter to the extent that (A) shares
are used to pay the exercise price pursuant to the “net exercise,” (B) shares
are delivered to the Participant as a result of such exercise, and (C) shares
are withheld to satisfy tax withholding obligations;  or

     

    (v) in any
other form of legal consideration that may be acceptable to the
Board.

     

    (d) Transferability of
Options.  The Board may, in its sole discretion, impose such
limitations on the transferability of Options as the Board shall
determine.  In the absence of such a determination by the Board to the
contrary, the following restrictions on the transferability of Options shall
apply:

     

    (i) Restrictions on
Transfer.  An Option shall not be transferable except by will
or by the laws of descent and distribution and shall be exercisable during the
lifetime of the Optionholder only by the Optionholder; provided, however, that the
Board may, in its sole discretion, permit transfer of the Option in a manner
consistent with applicable tax and securities laws upon the Optionholder’s
request.

     

    (ii) Domestic Relations
Orders.  Notwithstanding the foregoing, an Option may be
transferred pursuant to a domestic relations order, provided, however, that an
Incentive Stock Option may be deemed to be a Nonqualified Stock Option as a
result of such transfer.

     

    (iii) Beneficiary Designation.
Notwithstanding the foregoing, the Optionholder may, by delivering written
notice to the Company, in a form provided by or otherwise satisfactory to the
Company, designate a third party who, in the event of the death of the
Optionholder, shall thereafter be the beneficiary of an Option with the right to
exercise the Option and receive the Common Stock or other consideration
resulting from an Option exercise.

     

    (e) Vesting
Generally.  The total number of shares of Common Stock subject
to an Option may vest and therefore become exercisable in periodic installments
that may or may not be equal.  The Option may be subject to such other
terms and conditions on the time or times when it may or may not be exercised
(which may be based on the satisfaction of Performance

     

    
      
         

      

      
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    Goals or
other criteria) as the Board may deem appropriate.  The vesting
provisions of individual Options may vary.  Notwithstanding the
foregoing or any other provision of the Plan to the contrary, the vesting of any
Option may only be accelerated in the event of a Participant’s death, Disability
or Retirement or upon a Change in Control; provided, however, that up to
5% of the shares reserved for issuance under the Plan pursuant to Section 4(a)
may be subject to Awards which do not meet the preceding acceleration
restrictions.  The provisions of this Section 6(e) are subject to any
Option provisions governing the minimum number of shares of Common Stock as to
which an Option may be exercised.

     

    (f) Termination of Continuous
Service.  Except as otherwise provided in the applicable Option
Agreement or other agreement between the Optionholder and the Company, in the
event that an Optionholder’s Continuous Service terminates (other than upon the
Optionholder’s death or Disability), the Optionholder may exercise his or her
Option (to the extent that the Optionholder was entitled to exercise such Option
as of the date of termination of Continuous Service) but only within such period
of time ending on the earlier of (i) the date three (3) months following the
termination of the Optionholder’s Continuous Service (or such longer or shorter
period specified in the Option Agreement), or (ii) the expiration of the term of
the Option as set forth in the Option Agreement.  If, after
termination of Continuous Service, the Optionholder does not exercise his or her
Option within the time specified herein or in the Option Agreement (as
applicable), the Option shall terminate.

     

    (g) Extension of Termination
Date.  An Optionholder’s Option Agreement may provide that if
the exercise of the Option following the termination of the Optionholder’s
Continuous Service (other than upon the Optionholder’s death or Disability)
would be prohibited at any time solely because the issuance of shares of Common
Stock would violate the registration requirements under the Securities Act, then
the Option shall terminate on the earlier of (i) the expiration of the term of
the Option as set forth in the Option Agreement or (ii) the expiration of a
period of three (3) months after the termination of the Optionholder’s
Continuous Service during which the exercise of the Option would not be in
violation of such registration requirements.

     

    (h) Disability of
Optionholder.  In the event that an Optionholder’s Continuous
Service terminates as a result of the Optionholder’s Disability, the
Optionholder may exercise his or her Option (to the extent that the Optionholder
was entitled to exercise such Option as of the date of termination of Continuous
Service), but only within such period of time ending on the earlier of (i) the
date twelve (12) months following such termination of Continuous Service (or
such longer or shorter period specified in the Option Agreement), or (ii) the
expiration of the term of the Option as set forth in the Option
Agreement.  If, after termination of Continuous Service, the
Optionholder does not exercise his or her Option within the time specified
herein or in the Option Agreement (as applicable), the Option shall
terminate.

     

    (i) Death of
Optionholder.  In the event that (i) an Optionholder’s
Continuous Service terminates as a result of the Optionholder’s death, or (ii)
the Optionholder dies within the period (if any) specified in the Option
Agreement after the termination of the Optionholder’s Continuous Service for a
reason other than death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date of death) by
the Optionholder’s estate, by a person who acquired the right to exercise the
Option by bequest or

     

    
      
         

      

      
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    inheritance
or by a person designated as the beneficiary of the Option upon the
Optionholder’s death, but only within the period ending on the earlier of (A)
the date twelve (12) months following the date of death (or such longer or
shorter period specified in the Option Agreement), or (B) the expiration of the
term of such Option as set forth in the Option Agreement.  If, after
the Optionholder’s death, the Option is not exercised within the time specified
herein or in the Option Agreement (as applicable), the Option shall
terminate.  If the Optionholder designates a third party beneficiary
of the Option in accordance with Section 6(d)(iii), then upon the death of the
Optionholder such designated beneficiary shall have the sole right to exercise
the Option and receive the Common Stock or other consideration resulting from an
Option exercise.

     

    (j) Non-Exempt
Employees.  No Option granted to an Employee that is a
non-exempt employee for purposes of the Fair Labor Standards Act shall be first
exercisable for any shares of Common Stock until at least six (6) months
following the date of grant of the Option.  The foregoing provision is
intended to operate so that any income derived by a non-exempt employee in
connection with the exercise or vesting of an Option will be exempt from his or
her regular rate of pay.

     

    (k) Early Exercise.  The
Option may, but need not, include a provision whereby the Optionholder may elect
at any time before the Optionholder’s Continuous Service terminates to exercise
the Option as to any part or all of the shares of Common Stock subject to the
Option prior to the full vesting of the Option.  Any unvested shares
of Common Stock so purchased may be subject to a repurchase option in favor of
the Company or to any other restriction the Board determines to be
appropriate.  The Company will not exercise its repurchase option
until at least six (6) months (or such longer or shorter period of time required
to avoid a charge to earnings for financial accounting purposes) have elapsed
following exercise of the Option unless the Board otherwise specifically
provides in the Option.

     

    7. Provisions
of Restricted Stock Awards.

     

               Each
Restricted Stock Award Agreement shall be in such form and shall contain such
terms and conditions as the Board shall deem appropriate.  To the
extent consistent with the Company’s Bylaws, at the Board’s election, shares of
Common Stock may be (x) held in book entry form subject to the Company’s
instructions until any restrictions relating to the Restricted Stock Award
lapse; or (y) evidenced by a certificate, which certificate shall be held
in such form and manner as determined by the Board.  The terms and
conditions of Restricted Stock Award Agreements may change from time to time,
and the terms and conditions of separate Restricted Stock Award Agreements need
not be identical; provided,
however, that each Restricted Stock Award Agreement shall include
(through incorporation of provisions hereof by reference in the agreement or
otherwise) the substance of each of the following provisions:

     

    (a) Consideration.  A
Restricted Stock Award may be awarded in consideration for (A) past or future
services actually or to be rendered to the Company or an Affiliate, or (B) any
other form of legal consideration that may be acceptable to the Board in its
sole discretion and permissible under applicable law.

     

    (b) Vesting.  Shares of
Common Stock awarded under the Restricted Stock Award Agreement may be subject
to forfeiture to the Company in accordance with a vesting schedule
to

     

    
      
         

      

      
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    be
determined by the Board (which may be based on the satisfaction of Performance
Goals or other criteria) as the Board may deem appropriate.  The
vesting provisions of individual Restricted Stock Awards may
vary.  Notwithstanding the foregoing or any other provision of the
Plan to the contrary, (i) any Restricted Stock Award which vests on the basis of
a Participant’s Continuous Service shall not provide for vesting which is any
more rapid than pro rata vesting over a three (3) year period and any Restricted
Stock Award which provides for vesting upon the satisfaction of Performance
Goals shall provide for a Performance Period of at least twelve (12) months, and
(ii) the vesting of any Restricted Stock Award may only be accelerated in the
event of a Participant’s death, Disability or Retirement or upon a Change in
Control; provided,
however, that up to 5% of the shares reserved for issuance under the Plan
pursuant to Section 4(a) may be subject to Awards which do not meet the
preceding vesting or acceleration restrictions.

     

    (c) Termination of Participant’s
Continuous Service.  In the event a Participant’s Continuous
Service terminates, the Company may receive via a forfeiture condition, any or
all of the shares of Common Stock held by the Participant which have not vested
as of the date of termination of Continuous Service under the terms of the
Restricted Stock Award Agreement.

     

    (d) Transferability.  Rights
to acquire shares of Common Stock under the Restricted Stock Award Agreement
shall be transferable by the Participant only upon such terms and conditions as
are set forth in the Restricted Stock Award Agreement, as the Board shall
determine in its sole discretion, so long as Common Stock awarded under the
Restricted Stock Award Agreement remains subject to the terms of the Restricted
Stock Award Agreement.  Notwithstanding the foregoing, the Participant
may, by delivering written notice to the Company, in a form provided by or
otherwise satisfactory to the Company, designate a third party who, in the event
of the death of the Participant, shall thereafter be entitled to receive shares
of Common Stock that have become vested as of the date of the Participant’s
death.

     

    8. Provisions
of Restricted Stock Unit Awards.

     

    Each
Restricted Stock Unit Award Agreement shall be in such form and shall contain
such terms and conditions as the Board shall deem appropriate.  The
terms and conditions of Restricted Stock Unit Award Agreements may change from
time to time, and the terms and conditions of separate Restricted Stock Unit
Award Agreements need not be identical; provided, however, that each Restricted
Stock Unit Award Agreement shall include (through incorporation of the
provisions hereof by reference in the Agreement or otherwise) the substance of
each of the following provisions:

     

    (a) Consideration.  At
the time of grant of a Restricted Stock Unit Award, the Board will determine the
consideration, if any, to be paid by the Participant upon delivery of each share
of Common Stock subject to the Restricted Stock Unit Award. The consideration to
be paid (if any) by the Participant for each share of Common Stock subject to a
Restricted Stock Unit Award may be paid in any form of legal consideration that
may be acceptable to the Board in its sole discretion and permissible under
applicable law.

     

    (b) Vesting.  At the
time of the grant of a Restricted Stock Unit Award, the Board may impose such
restrictions or conditions to the vesting of the Restricted Stock Unit Award
as

     

    
      
         

      

      
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    it, in
its sole discretion, deems appropriate (including vesting based on the
satisfaction of Performance Goals or other criteria).  The vesting
provisions of individual Restricted Stock Unit Awards may
vary.  Notwithstanding the foregoing or any other provision of the
Plan to the contrary, (i) any Restricted Stock Unit Award which vests on the
basis of a Participant’s Continuous Service shall not provide for vesting which
is any more rapid than pro rata vesting over a three (3) year period and any
Restricted Stock Unit Award which provides for vesting upon the satisfaction of
Performance Goals shall provide for a Performance Period of at least twelve (12)
months, and (ii) the vesting of any Restricted Stock Unit Award may only be
accelerated in the event of a Participant’s death, Disability or Retirement or
upon a Change in Control; provided, however, that up to
5% of the shares reserved for issuance under the Plan pursuant to Section 4(a)
may be subject to Awards which do not meet the preceding vesting or acceleration
restrictions.

     

    (c) Payment.  A
Restricted Stock Unit Award may be settled by the delivery of shares of Common
Stock, their cash equivalent, any combination thereof or in any other form of
consideration, as determined by the Board and contained in the Restricted Stock
Unit Award Agreement.

     

    (d) Additional
Restrictions.  At the time of the grant of a Restricted Stock
Unit Award, the Board, as it deems appropriate, may impose such restrictions or
conditions that delay the delivery of the shares of Common Stock (or their cash
equivalent) subject to a Restricted Stock Unit Award to a time after the vesting
of such Restricted Stock Unit Award.

     

    (e) Dividend
Equivalents.  Dividend equivalents may be credited in respect
of shares of Common Stock covered by a Restricted Stock Unit Award, as
determined by the Board and contained in the Restricted Stock Unit Award
Agreement.  At the sole discretion of the Board, such dividend
equivalents may be converted into additional shares of Common Stock covered by
the Restricted Stock Unit Award in such manner as determined by the
Board.  Any additional shares covered by the Restricted Stock Unit
Award credited by reason of such dividend equivalents will be subject to all the
terms and conditions of the underlying Restricted Stock Unit Award Agreement to
which they relate.

     

    (f) Termination of Participant’s
Continuous Service.  Except as otherwise provided in the
applicable Restricted Stock Unit Award Agreement, such portion of the Restricted
Stock Unit Award that has not vested will be forfeited upon the Participant’s
termination of Continuous Service.

     

    (g) Compliance with Section 409A of the
Code.   Notwithstanding anything to the contrary set forth
herein, any Restricted Stock Unit Award granted under the Plan that is not
exempt from the requirements of Section 409A of the Code shall contain such
provisions so that such Restricted Stock Unit Award will comply with the
requirements of Section 409A of the Code.  Such restrictions, if any,
shall be determined by the Board and contained in the Restricted Stock Unit
Award Agreement evidencing such Restricted Stock Unit Award.  For
example, such restrictions may include, without limitation, a requirement that
any Common Stock that is to be issued in a year following the year in which the
Restricted Stock Unit Award vests must be issued in accordance with a fixed
pre-determined schedule.

     

    
      
         

      

      
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    9. Non-Executive
Director Stock Awards.

     

    (a) Stock
Awards.  Without any further action of the Board or any
committee thereof, each Non-Executive Director shall be granted a Non-Executive
Director Stock Award at each of the times specified in Section 9(a)(i) below,
which Non-Executive Director Stock Award shall have the terms set forth in
Sections 9(a)(ii) and 9(a)(iii) below.  Such award shall result in the
issuance and delivery of shares of Common Stock to the Non-Executive Director on
the date of grant.

     

    (i) Quarterly
Grants.  Each Non-Executive Director who is serving as a
Non-Executive Director on the first day of each of the Company’s fiscal quarters
shall be granted a Non-Executive Director Stock Award on such day (a “Quarterly
Grant”).

     

    (ii) Number of
Shares.  The number of shares of Common Stock subject to each
Quarterly Grant will be equal to the quotient of fourteen thousand three hundred
seventy-five dollars ($14,375) divided by the Fair Market Value of the Common
Stock on the date of grant, rounded down to the nearest whole
share.

     

    (iii) Vesting.  Each
Quarterly Grant shall be fully vested on the date of grant.

     

    (b) Deferred Stock
Awards.  Without any further action of the Board or any
committee thereof, each Non-Executive Director shall be granted a deferred
Non-Executive Director Stock Award at the time specified in Section 9(b)(i)
below, which deferred Non-Executive Director Stock Award shall have the terms
set forth in Sections 9(b)(ii) and 9(b)(iii) below.  Until the shares
of Common Stock are issued pursuant to Section 9(b)(iii) below in respect of a
deferred Non-Executive Director Stock Award, such Award shall represent a
notional number of shares and a promise by the Company to issue to the
Non-Executive Director such number of shares (subject to adjustment as provided
in Section 14(a)), and the Non-Executive Director shall have no stockholder or
other ownership rights (including, but not limited to, the right to receive any
dividend paid) in respect of such shares until their issuance.

     

    (i) Quarterly
Grants.  Each Non-Executive Director who is serving as a
Non-Executive Director on the first day of each of the Company’s fiscal quarters
shall be granted a deferred Non-Executive Director Stock Award on such day (a
“Quarterly Deferred Grant”).

     

    (ii) Number of
Shares.  Each Quarterly Deferred Grant will entitle the
Non-Executive Director to receive, at the time specified in Section 9(b)(iii)
below, a number of shares of Common Stock equal to the quotient of fourteen
thousand three hundred seventy-five dollars ($14,375) divided by the Fair Market
Value of the Common Stock on the date of grant, rounded down to the nearest
whole share (and subject to adjustment as necessary).

     

    (iii) Vesting and
Issuance.  Each Quarterly Deferred Grant shall be fully vested
on the date of grant; provided that the notional number of shares of Common
Stock in respect of each Quarterly Deferred Grant shall not be issued or
issuable, and instead shall accumulate and be credited by the Corporation to a
bookkeeping account in the name of the Non-Executive Director, until such time
as the Non-Executive Director terminates his or her service on the Board for any
reason, at which time the Company shall issue and deliver to the
Non-

     

    
      
         

      

      
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    Executive
Director, on the date that is six (6) months following such termination of
service (or as soon as administratively practicable thereafter), a number of
shares of Common Stock equal to the cumulative notional number of shares (as
adjusted) in respect of the Non-Executive Director’s cumulative Quarterly
Deferred Grants.

     

    (c) Consideration.  Each
Quarterly Grant and Quarterly Deferred Grant shall be awarded in consideration
for services rendered as a Non-Executive Director.

     

    (d) Amendment of Terms of Quarterly
Grants and Quarterly Deferred Grants.  The Board may at any
time, and from time to time, amend the terms pursuant to which Non-Executive
Director Stock Awards, including the Quarterly Grants and Quarterly Deferred
Grants, shall be granted, including, without limitation, amendment of the dollar
amount specified in Sections 9(a)(ii) and 9(b)(ii) above and any other provision
of this Section 9.

     

    10. Performance
Awards.

     

    (a) Performance Stock
Awards.  A Performance Stock Award is a Stock Award that may be
granted, may vest, or may be exercised based upon the attainment during a
Performance Period of certain Performance Goals.  A Performance Stock
Award may, but need not, require the completion of a specified period of
Continuous Service. The length of any Performance Period, the Performance Goals
to be achieved during the Performance Period, and the measure of whether and to
what degree such Performance Goals have been attained shall be conclusively
determined by the Committee in its sole discretion.  In addition, to
the extent permitted by applicable law and the applicable Award Agreement, the
Board may determine that cash may be used in payment of Performance Stock
Awards.  Notwithstanding the foregoing or any other provision of the
Plan to the contrary, (i) any Performance Stock Award which provides for vesting
upon the satisfaction of Performance Goals shall provide for a Performance
Period of at least twelve (12) months, and (ii) the vesting of any Performance
Stock Award may only be accelerated in the event of a Participant’s death,
Disability or Retirement or upon a Change in Control; provided, however, that up to
5% of the shares reserved for issuance under the Plan pursuant to Section 4(a)
may be subject to Awards which do not meet the preceding vesting or acceleration
restrictions.

     

    (b) Performance Cash
Awards.  A Performance Cash Award is a cash award that may be
granted upon the attainment during a Performance Period of certain Performance
Goals.  A Performance Cash Award may, but need not, require the
completion of a specified period of Continuous Service.  The length of
any Performance Period, the Performance Goals to be achieved during the
Performance Period, and the measure of whether and to what degree such
Performance Goals have been attained shall be conclusively determined by the
Committee in its sole discretion.  The Board may provide for or,
subject to such terms and conditions as the Board may specify, may permit a
Participant to elect for, the payment of any Performance Cash Award to be
deferred to a specified date or event.  The Committee may specify the
form of payment of Performance Cash Awards, which may be cash or other property,
or may provide for a Participant to have the option for his or her Performance
Cash Award, or such portion thereof as the Board may specify, to be paid in
whole or in part in cash or other property.   In addition, to the
extent permitted by applicable law and the applicable Award Agreement, the Board
may determine that Common Stock authorized under this Plan may be used in
payment of

     

    
      
         

      

      
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    Performance
Cash Awards, including additional shares in excess of the Performance Cash Award
as an inducement to hold shares of Common Stock.

     

    11. Other Stock
Awards.

     

    Other forms of Stock Awards valued in
whole or in part by reference to, or otherwise based on, Common Stock may be
granted either alone or in addition to Stock Awards provided for under Sections
‎6
through 10.  Subject to the provisions of the Plan, the Board shall
have sole and complete authority to determine the persons to whom and the time
or times at which such Other Stock Awards will be granted, the number of shares
of Common Stock (or the cash equivalent thereof) to be granted pursuant to such
Other Stock Awards and all other terms and conditions of such Other Stock
Awards. Notwithstanding the
foregoing or any other provision of the Plan to the contrary, (i) any Other
Stock Award which vests on the basis of a Participant’s Continuous Service shall
not provide for vesting which is any more rapid than pro rata vesting over a
three (3) year period and any Other Stock Award which provides for vesting upon
the satisfaction of Performance Goals shall provide for a Performance Period of
at least twelve (12) months, and (ii) the vesting of any Other Stock Award may
only be accelerated in the event of a Participant’s death, Disability or
Retirement or upon a Change in Control; provided, however, that up to
5% of the shares reserved for issuance under the Plan pursuant to Section 4(a)
may be subject to Awards which do not meet the preceding vesting or acceleration
restrictions.

     

    12. Covenants
of the Company.

     

    (a) Availability of
Shares.  During the terms of the Stock Awards, the Company
shall keep available at all times the number of shares of Common Stock required
to satisfy such Stock Awards.

     

    (b) Legal
Compliance.  The Company shall seek to obtain from each
regulatory commission or agency having jurisdiction over the Plan such authority
as may be required to grant Stock Awards and to issue and sell shares of Common
Stock upon exercise of the Stock Awards; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
the Plan, any Stock Award or any Common Stock issued or issuable pursuant to any
such Stock Award.  If, after reasonable efforts, the Company is unable
to obtain from any such regulatory commission or agency the authority which
counsel for the Company deems necessary for the lawful issuance and sale of
Common Stock under the Plan, the Company shall be relieved from any liability
for failure to issue and sell Common Stock upon exercise of such Stock Awards
unless and until such authority is obtained.

     

    (c) No Obligation to
Notify.  The Company shall have no duty or obligation to any
holder of a Stock Award to advise such holder as to the time or manner of
exercising such Stock Award.  Furthermore, the Company shall have no
duty or obligation to warn or otherwise advise such holder of a pending
termination or expiration of a Stock Award or a possible period in which the
Stock Award may not be exercised.  The Company has no duty or
obligation to minimize the tax consequences of a Stock Award to the holder of
such Stock Award.

     

    
      
         

      

      
        xix

        
          

        

      

      
         

      

    

    13. Miscellaneous.

     

    (a) Use of Proceeds from Sales of Common
Stock.  Proceeds from the sale of shares of Common Stock
pursuant to Stock Awards shall constitute general funds of the
Company.

     

    (b) Corporate Action Constituting Grant
of Stock Awards.  Corporate action constituting a grant by the
Company of a Stock Award to any Participant shall be deemed completed as of the
date of such corporate action, unless otherwise determined by the Board,
regardless of when the instrument, certificate, or letter evidencing the Stock
Award is communicated to, or actually received or accepted by, the
Participant.

     

    (c) Stockholder
Rights.  No Participant shall be deemed to be the holder of, or
to have any of the rights of a holder with respect to, any shares of Common
Stock subject to such Stock Award unless and until such Participant has
satisfied all requirements for exercise of the Stock Award pursuant to its terms
and the Participant shall not be deemed to be a stockholder of record until the
issuance of the Common Stock pursuant to such exercise has been entered into the
books and records of the Company.

     

    (d) No Employment or Other Service
Rights.  Nothing in the Plan, any Stock Award Agreement or in
the written terms of a Performance Cash Award or other instrument executed
thereunder or any Award granted pursuant thereto shall confer upon any
Participant any right to continue to serve the Company or an Affiliate in the
capacity in effect at the time the Award was granted or shall affect the right
of the Company or an Affiliate to terminate (i) the employment of an Employee
with or without notice and with or without cause, (ii) the service of a
Consultant pursuant to the terms of such Consultant’s agreement with the Company
or an Affiliate, or (iii) the service of a Director pursuant to the Bylaws of
the Company or an Affiliate, and any applicable provisions of the corporate law
of the state in which the Company or the Affiliate is incorporated, as the case
may be.

     

    (e) Incentive Stock Option $100,000
Limitation.  To the extent that the aggregate Fair Market Value
(determined at the time of grant) of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by any Optionholder
during any calendar year (under all plans of the Company and its Affiliates)
exceeds one hundred thousand dollars ($100,000), the Options or portions thereof
which exceed such limit (according to the order in which they were granted)
shall be treated as Nonstatutory Stock Options, notwithstanding any contrary
provision of the applicable Option Agreement(s).

     

    (f) Investment
Assurances.  The Company may require a Participant, as a
condition of exercising or acquiring Common Stock under any Stock Award, (i) to
give written assurances satisfactory to the Company as to the Participant’s
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters and that he or
she is capable of evaluating, alone or together with the purchaser
representative, the merits and risks of exercising the Stock Award; and (ii) to
give written assurances satisfactory to the Company stating that the Participant
is acquiring Common Stock subject to the Stock Award for the Participant’s own
account and not with any present intention of selling or otherwise

     

    
      
         

      

      
        xx

        
          

        

      

      
         

      

    

    distributing
the Common Stock.  The foregoing requirements, and any assurances
given pursuant to such requirements, shall be inoperative if (A) the issuance of
the shares of Common Stock upon the exercise or acquisition of Common Stock
under the Stock Award has been registered under a then currently effective
registration statement under the Securities Act or (B) as to any particular
requirement, a determination is made by counsel for the Company that such
requirement need not be met in the circumstances under the then applicable
securities laws.  The Company may, upon advice of counsel to the
Company, place legends on stock certificates issued under the Plan as such
counsel deems necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends restricting the transfer
of the Common Stock.

     

    (g) Withholding
Obligations.  Unless prohibited by the terms of a Stock Award
Agreement, the Company may, in its sole discretion, satisfy any federal, state,
local or foreign tax withholding obligation relating to an Award by any of the
following means (in addition to the Company’s right to withhold from any
compensation paid to the Participant by the Company) or by a combination of such
means: (i) causing the Participant to tender a cash payment;
(ii)  withholding shares of Common Stock from the shares of Common
Stock issued or otherwise issuable to the Participant in connection with the
Award; (iii) withholding cash from an Award settled in cash; or (iv) by such
other method as may be set forth in the Award Agreement.

     

    (h) Electronic
Delivery.  Any reference herein to a “written” agreement or
document shall include any agreement or document delivered electronically or
posted on the Company’s intranet.

     

    (i) Deferrals.  To the
extent permitted by applicable law, the Board, in its sole discretion, may
determine that the delivery of Common Stock or the payment of cash, upon the
exercise, vesting or settlement of all or a portion of any Award may be deferred
and may establish programs and procedures for deferral elections to be made by
Participants.  Deferrals by Participants will be made in accordance
with Section 409A of the Code.  Consistent with Section 409A of the
Code, the Board may provide for distributions while a Participant is still an
Employee.  The Board is authorized to make deferrals of Stock Awards
and determine when, and in what annual percentages, Participants may receive
payments, including lump sum payments, following the Participant’s termination
of employment or retirement, and implement such other terms and conditions
consistent with the provisions of the Plan and in accordance with applicable
law.

     

    (j) Compliance with Section 409A of the
Code.  To the extent that the Board determines that any Award
granted under the Plan is subject to Section 409A of the Code, the Award
Agreement evidencing such Award shall incorporate the terms and conditions
necessary to avoid the consequences specified in Section 409A(a)(1) of the
Code.  To the extent applicable, the Plan and Award Agreements shall
be interpreted in accordance with Section 409A of the Code and Department of
Treasury regulations and other interpretive guidance issued thereunder,
including without limitation any such regulations or other guidance that may be
issued or amended after the Effective Date.  Notwithstanding any
provision of the Plan to the contrary, in the event that following the Effective
Date the Board determines that any Award may be subject to Section 409A of the
Code and related Department of Treasury guidance (including such Department of
Treasury guidance as may be issued after the Effective Date), the Board
may

     

    
      
         

      

      
        xxi

        
          

        

      

      
         

      

    

    adopt
such amendments to the Plan and the applicable Award Agreement or adopt other
policies and procedures (including amendments, policies and procedures with
retroactive effect), or take any other actions, that the Board determines are
necessary or appropriate to (i) exempt the Award from Section 409A of the Code
and/or preserve the intended tax treatment of the benefits provided with respect
to the Award, or (ii) comply with the requirements of Section 409A of the Code
and Department of Treasury regulations and other interpretive guidance issued
thereunder, including without limitation any such regulations or other guidance
that may be issued or amended after the Effective Date.

     

    14. Adjustments
upon Changes in Common Stock; Change in Control.

     

    (a) Capitalization
Adjustments.  In the event of a Capitalization Adjustment, the
Board shall appropriately adjust: (i) the class(es) and maximum number of
securities subject to the Plan pursuant to Section 4(a), (ii) the class(es) and
maximum number of securities that may be issued pursuant to the exercise of
Incentive Stock Options pursuant to Section 4(c), (iii) the class(es) and
maximum number of securities that may be awarded to any person pursuant to
Section 5(d), and (iv) the class(es) and number of securities and price per
share of Common Stock subject to outstanding Stock Awards.  The Board
shall make such adjustments, and its determination shall be final, binding and
conclusive.

     

    (b) Dissolution or
Liquidation.  In the event of a dissolution or liquidation of
the Company, all outstanding Stock Awards shall terminate immediately prior to
such event.

     

    (c) Change in
Control.  Unless otherwise provided in the Stock Award
Agreement or any other written agreement between the Company or any Affiliate
and the Participant or unless otherwise expressly provided by the Board at the
time of grant of a Stock Award, in the event of a Change in Control, then prior
to the effective time of the Change in Control, (i) any surviving entity or
controlling entity may assume any Stock Awards outstanding under the Plan or may
substitute similar stock awards (including an award to acquire the same
consideration paid to the stockholders of the Company in the Change in Control)
for those outstanding under the Plan, and any reacquisition or repurchase rights
held by the Company in respect of Common Stock issued pursuant to Stock Awards
may be assigned by the Company to the surviving entity or controlling entity, or
(ii) the Board may, in its sole discretion, make payments, in such form as may
be determined by the Board, to Participants holding Stock Awards in amounts that
the Board determines represent the value of the outstanding Stock Awards and
such payments shall completely discharge the Company’s obligations under such
outstanding Stock Awards.  The surviving entity or controlling entity
may choose to assume or continue only a portion of a Stock Award or substitute a
similar stock award for only a portion of a Stock Award.  The terms of
any assumption, continuation or substitution shall be set by the Board in
accordance with the provisions of Section 3.

     

    In the
event that (i) the surviving entity or controlling entity does not assume such
Stock Awards or substitute similar stock awards for those outstanding under the
Plan, and (ii) the Board does not make payments to settle the outstanding Stock
Awards pursuant to the foregoing, then (a) with respect to Stock Awards held by
Participants whose Continuous Service has not terminated prior to the effective
time of the Change in Control, the vesting of such Stock Awards (and, if
applicable, the time during which such Stock Awards may be exercised) shall
be

     

    
      
         

      

      
        xxii

        
          

        

      

      
         

      

    

    accelerated
in full as of a time designated by the Board (contingent upon the effectiveness
of the Change in Control), and the Stock Awards shall terminate if not exercised
(if applicable) at or prior to such time designated by the Board, and any
reacquisition or repurchase rights held by the Company with respect to the Stock
Awards shall lapse (contingent upon the effectiveness of the Change in Control)
and (b) with respect to any other Stock Awards outstanding under the Plan, such
Stock Awards shall terminate if not exercised (if applicable) prior to a time
designated by the Board; provided, however, that any
reacquisition or repurchase rights held by the Company with respect to such
Stock Awards shall not terminate and may continue to be exercised
notwithstanding the Change in Control.

     

    15. Limitation
on Payments.

     

    (a) Basic Rule. Any provision of
the Plan to the contrary notwithstanding, in the event that the independent
auditors most recently selected by the Board (the “Auditors”) determine that any
payment or transfer by the Company to or for the benefit of a Participant,
whether paid or payable (or transferred or transferable) pursuant to the terms
of this Plan or otherwise (a “Payment”), would be nondeductible by the Company
for federal income tax purposes because of the provisions concerning “excess
parachute payments” in Section 280G of the Code, then the aggregate present
value of all Payments shall be reduced (but not below zero) to the Reduced
Amount; provided that
the Board, at the time of granting a Stock Award under this Plan or at any time
thereafter, may specify in writing that such Award shall not be so reduced and
shall not be subject to this Section 15.  For purposes of this Section
15, the “Reduced Amount” shall be the amount, expressed as a present value,
which maximizes the aggregate present value of the Payments without causing any
Payment to be nondeductible by the Company because of Section 280G of the
Code.

     

    (b) Reduction of
Payments.  If the Auditors determine that any Payment would be
nondeductible by the Company because of Section 280G of the Code, then the
Company shall promptly give the Participant notice to that effect and a copy of
the detailed calculation thereof and of the Reduced Amount, and the Participant
may then elect, in his or her sole discretion, which and how much of the
Payments shall be eliminated or reduced (as long as after such election the
aggregate present value of the Payments equals the Reduced Amount) and shall
advise the Company in writing of his or her election within ten (10) days of
receipt of notice; provided,
however, that such election shall be subject to Company approval if made
on or after the effective date of a Change in Control.  If no such
election is made by the Participant within such
 
ten (10) day
period, then the Company may elect which and how much of the Payments shall be
eliminated or reduced (as long as after such election the aggregate present
value of the Payments equals the Reduced Amount) and shall notify the
Participant promptly of such election.  For purposes of this Section
15, present value
 
shall be determined in accordance with
Section 280G(d)(4) of the Code.  All determinations made by the
Auditors under this Section 15 shall be binding upon the Company and the
Participant and shall be made within sixty (60) days of the date when a payment
becomes payable or transferable. As promptly as practicable following such
determination and the elections hereunder, the Company shall pay or transfer to
or for the benefit of the Participant such amounts as are then due to him or her
under the Plan and shall promptly pay or transfer to or for the benefit of the
Participant in the future such amounts as become due to him or her under the
Plan.

     

    
      
         

      

      
        xxiii

        
          

        

      

      
         

      

    

    (c) Overpayments and Underpayments.
As a result of uncertainty in the application of Section 280G of the Code
at the time of an initial determination by the Auditors hereunder, it is
possible that Payments will have been made by the Company which should not have
been made (an “Overpayment”) or that additional Payments which will not have
been made by the Company could have been made (an “Underpayment”), consistent in
each case with the calculation of the Reduced Amount hereunder.  In
the event that the Auditors determine, based upon the assertion of a deficiency
by the
 Internal Revenue Service against the
Company or the Participant which the Auditors believe has a high probability of
success, that an Overpayment has been made, such Overpayment shall be treated
for all purposes as a loan to the Participant which he or
 
s

he shall repay to the Company, together
with interest at the applicable federal rate provided in Section
 
7872(f)(2) of the Code; provided, however, that no
amount shall be payable by the Participant to the Company if and to the extent
that such payment would not reduce the amount that is subject to taxation under
Section 4999 of the Code.  In the event that the Auditors determine
that an Underpayment has occurred, such Underpayment shall promptly be paid or
transferred by the Company to or for the benefit of the Participant, together
with interest at the applicable federal rate provided in Section
 
7872(f)(2) of the Code.

     

    (d) Related Corporations. For
purposes of this Section 15, the term “Company” shall include affiliated
corporations to the extent determined by the Auditors in accordance with Section
280G(d)(5) of the Code.

     

    16. Termination
or Suspension of the Plan.

     

    (a) Plan Term.  Unless
sooner terminated by the Board pursuant to Section 3, the Plan shall
automatically terminate on the date that is the fifth anniversary of the
Effective Date.  No Awards may be granted under the Plan while the
Plan is suspended or after it is terminated.

     

    (b) No Impairment of
Rights.  Suspension or termination of the Plan shall not impair
rights and obligations under any Award granted while the Plan is in effect
except with the written consent of the affected Participant.

     

    17. Effective
Date of Plan.

     

    This Plan
shall become effective on the Effective Date.

     

    18. Choice
of Law.

     

    The law
of the State of Delaware shall govern all questions concerning the construction,
validity and interpretation of this Plan, without regard to such state’s
conflict of laws rules.

     

    
      xxivex10-2.htm

EXHIBIT 10.2 

 

NON-EXECUTIVE DIRECTOR COMPENSATION PROGRAM

	
Annual Retainers

	 	 	 
	
· Annual Retainer for each Director

	 	$	60,000	(1)
	
· Annual Additional Retainer for Chair of Audit Committee

	 	$	15,000	(2)
	
· Annual Additional Retainer for Chair of Compensation Committee

	 	$	5,000	(2)
	
· Annual Additional Retainer for Chair of Board Affairs Committee

	 	$	5,000	(2)
	
· Annual Additional Retainer for Lead Independent Director

	 	$	25,000	(2)
	  	 	 	 	 
	
Meeting Fees

	 	 	 	 
	
· Board Members

	 	$	2,000	(3)
	
· Committee Members

	 	$	1,500	(4)
	
· Audit Committee Chair

	 	$	4,000	(5)
	
· Board Affairs Committee Chair

	 	$	3,000	(5)
	
· Compensation Committee Chair

	 	$	3,000	(5)
	
· Telephonic Board and Committee Meetings

	 	$	750	(6)
	  	 	 	 	 
	
Equity Compensation

	 	 	 	 
	
· Annual Stock Award (fully vested)

	 	$	57,500	(7)
	
· Annual Deferred Stock Award (fully vested)

	 	$	57,500	(8)

__________________________

	
(1)  

	
Payable quarterly in advance on the first business day of each fiscal quarter.

	
(2)  

	
Payable quarterly concurrently with the Annual Retainer.

	
(3)  

	
Payable to each non-executive Director per meeting attended in person.

	
(4)  

	
Payable to each Committee member (other than Chair) per meeting attended in person.

	
(5)  

	
Payable to each Committee Chair per meeting chaired in person.

	
(6)  

	
Payable to each non-executive Director and Committee Chair per meeting attended or chaired by telephone.

	
(7)  

	
One-fourth granted quarterly, with the number of shares calculated on the basis of the fair market value of the Common Stock as of the first day of each fiscal quarter.

	
(8)  

	
One-fourth granted quarterly, with the number of shares calculated on the basis of the fair market value of the Common Stock as of the first day of each fiscal quarter; issued six months after Board service has terminated.

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