Document:

Exhibit

Exhibit 4.08

DESCRIPTION OF THE COMPANY’S SECURITIES 
REGISTERED PURSUANT TO SECTION 12 OF THE 
SECURITIES EXCHANGE ACT OF 1934 
(as of December 31, 2019)
 
Federated Hermes, Inc. (the “Company”) has one class of securities registered under Section 12 of the Securities Exchange Act of 1934:  Class B Common Stock, no par value per share (“Class B Common Stock”).  The Company’s Class B Common Stock is listed on the New York Stock Exchange (Ticker:  “FHI”). 

The authorized share capital of the Company consists of 20,000 shares of Class A Common Stock, no par value per share (“Class A Common Stock”), 900,000,000 shares of Class B Common Stock, and 100,000,000 shares of Preferred Stock, no par value per share (“Preferred Stock”). As of December 31, 2019, there were 9,000 shares of Class A Common Stock issued and outstanding, 109,505,456 shares of Class B Common Stock issued and outstanding and no shares of Preferred Stock issued and outstanding.  For a complete understanding of the Company’s authorized share capital reference should be made to the Restated Articles of Incorporation of the Company (“Restated Articles”), filed as Exhibit 3.1 to the Form 8-K, dated February 3, 2020 (File No. 001-14818).
 
CLASS B COMMON STOCK
 
Voting Rights
 
Except as otherwise provided in the Restated Articles or by applicable law, all voting power is vested in the holders of the Class A Common Stock, and the holders of the Class B Common Stock have no voting rights with respect to matters upon which shareholders are entitled to vote, (except in limited circumstances as described below).

On all matters upon which shareholders are entitled to vote or give consent, each holder of a share of Class A Common Stock is entitled to cast thereon one vote in person or by proxy for each share of Class A Common Stock held of record by such holder.  The Voting Shares Irrevocable Trust, dated May 31, 1989 (“Voting Trust”), has control of the Company through its ownership of all of the outstanding shares of the Class A Common Stock of the Company.  As of December 31, 2019, the three trustees of the Voting Trust are J. Christopher Donahue, the Company’s President and Chief Executive Officer and Chairman of the Board of Directors, Thomas R. Donahue, the Company’s Vice President, Chief Financial Officer, and Treasurer, and a member of the Board of Directors, and Rhodora J. Donahue, their mother, for the benefit of certain members of the Donahue family.

The Restated Articles provide that with respect to any proposed amendment of the Restated Articles that would increase or decrease the number of authorized shares of either the Class A Common Stock or the Class B Common Stock, or alter or change the powers, preferences, relative voting power or special rights of the shares of the Class A Common Stock or the Class B Common Stock so as to affect them adversely, the approval of a majority of the votes entitled to be cast by the holders of the class affected by the proposed amendment, voting separately as a class, is required 

to be obtained in addition to the approval of a majority of the votes entitled to be cast by the holders of the Class A Common Stock and the Class B Common Stock voting together as a single class.
 
The Restated Articles provide that the Company cannot, prior to the Agreement Date, (as defined below), take any of the following actions without the consent of the holders of a majority of the then outstanding shares of Class B Common Stock: 
 
		
	(a)
	merge, consolidate with or otherwise acquire any corporation or other business entity; provided, however, that, in a transaction, (i) in which the Company is the surviving entity, and (ii) pursuant to which the Restated Articles have not been amended, altered, repealed or superseded, the Company may, without such consent, merge, consolidate with or otherwise acquire any corporation or other business entity;

 
		
	(b) 
	sell, lease, exchange or otherwise dispose of all or substantially all of the assets of the Company or any subsidiary thereof to other than a wholly owned subsidiary of the Company; provided, however, that, (i) in any transaction or series of related transactions not exceeding in value $100,000,000 in the aggregate, (taking into account all liabilities assumed by the Company or its subsidiaries in any such transaction or transactions), involving all or substantially all of the assets of any subsidiary, or (ii) in any transaction or series of transactions involving a securitization or other receivables sales transaction, the Company may, without such consent, sell, lease, exchange or otherwise dispose of all or substantially all of the assets of such subsidiary;

 
		
	(c) 
	effect any amendment to the Restated Articles or the Restated Bylaws of the Company (“Restated Bylaws”), that adversely affects the rights, powers or preferences of the shares of Class B Common Stock; or

 
		
	(d) 
	liquidate, dissolve or otherwise wind up the affairs of the Company.

 
The holders of the outstanding Class B Common Stock are entitled to additional voting rights in the event that no shares of Class A Common Stock remain outstanding or upon the occurrence of the Agreement Date.  Upon the occurrence of the Agreement Date, the holders of the outstanding Class A Common Stock also are entitled to cast 1,000 votes for each share of Class A Common Stock held of record by such holder and have the right to elect that number of directors so that four-tenths (4/10), (calculated to the next highest whole number), of the total number of directors of the Company fixed from time to time by, or in the manner provided for in, the Restated Bylaws, will have been elected by the holders of the Class A Common Stock separately.  Neither holders of the Class A Common Stock nor holders of the Class B Common Stock are or would be entitled to cumulate their votes for election of directors of the Company.  The "Agreement Date" is defined in the Restated Articles as the first date on which the Company shall execute and deliver, and enter into, a legally binding and enforceable agreement providing for the issue by the Company of shares of Class B Common Stock in a transaction constituting a business combination which, for financial reporting purposes, shall be accounted for as a pooling of interests in accordance with generally accepted accounting principles. It should be noted that, on January 23, 2001, the Financial Accounting Standards Board eliminated the use of the “pooling of interest” accounting method in 

favor of the “purchase method” of accounting for business combination transactions.  Accordingly, absent a further change to generally accepted accounting principles, the Agreement Date will not occur.

Dividend and Distribution Rights 
 
Under Pennsylvania law, the Board of Directors may authorize, and the Company may pay, dividends or make other distributions to shareholders unless, as a result, (a) the Company would be unable to pay its debts as they become due in the usual course of business, or (b) the total assets of the Company would be less than the sum of its total liabilities plus the amount that would be needed, if the Company were to be dissolved at the time of such distribution, to satisfy the preferential rights of holders of Preferred Stock, (i.e., to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving dividends).  There is no Preferred Stock issued and outstanding.  Dividends must be paid on both the Class A Common Stock and the Class B Common Stock at any time that dividends are paid on either.

Under the Restated Articles, the Class A Common Stock is not entitled to an economic premium over the Class B Common Stock, including in connection with, (i) distributions and dividends, and (ii) a “Company Sale” (as defined below).  The Class A Common Stock and Class B Common Stock of the Company have equal rights to dividends and distributions, when declared, whether in cash, stock, or other property, and are entitled to receive the same amount of consideration per share in the event of a purchase of the Company by another entity by means of any transaction or series of related transactions, (including without limitation, any reorganization, merger, consolidation, or stock purchase), or a sale of all or substantially all of the assets of the Company.  Shares of Class A Common Stock and shares of Class B Common Stock rank on a parity with respect to dividends and distributions; provided, however, that in the case of dividends or other distributions payable in stock of the Company, (other than Preferred Stock), including distributions pursuant to stock split-ups or divisions, only shares of the Class A Common Stock can be distributed with respect to the Class A Common Stock, and only shares of Class B Common Stock can be distributed with respect to the Class B Common Stock.  At any time shares of both the Class A Common Stock and the Class B Common Stock are outstanding, the Board of Directors may issue shares of the Class B Common Stock in the form of a distribution or distributions pursuant to a stock dividend on, or a split-up of, shares of the Class B Common Stock only to the then holders of the outstanding shares of the Class B Common Stock and in conjunction with and in the same ratio as a stock dividend on, or a split-up of, the shares of the Class A Common Stock.

Under the Restated Articles, in connection with a Company Sale, the holders of the Class A Common Stock and the Class B Common Stock are entitled to receive the same amount of consideration per share, notwithstanding any differences in voting rights. The term "Company Sale" includes the following: (A) the acquisition of the Company by another entity by means of any transaction or series of related transactions, (including, without limitation, any reorganization, merger, consolidation, or stock purchase), and (B) a sale of all or substantially all of the assets of the Company. In any Company Sale, if the consideration received by the Company or its stockholders, as the case may be, is other than cash, its value, as determined in good faith by the Board of Directors will be deemed its fair market value.

Liquidation Rights

Upon liquidation of the Company, holders of Class A Common Stock and holders of Class B Common Stock are entitled to share ratably in the assets of the Company that may be available for distribution after satisfaction of creditors.  

Preemptive Rights
 
The holders of the Class B Common Stock have no preemptive rights to subscribe for any shares of any class of stock of the Company.
 
Anti-Takeover Considerations

The Restated Articles contain certain provisions that could make more difficult a change in control of the Company not having approval of the Board of Directors or the holders of the Class A Common Stock.  As more fully described above in the section on “Voting Rights”, except as otherwise provided in the Restated Articles or by applicable law, all voting power is vested in the holders of the Class A Common Stock, and the Restated Articles grant holders of Class B Common Stock voting rights only in connection with specified extraordinary transactions.

The Restated Articles authorize the issuance of blank check Preferred Stock. The Board of Directors may establish voting rights, liquidation preferences, redemption rights, conversion rights and other rights relating to such Preferred Stock, all or some of which may be senior to the Class A Common Stock and the Class B Common Stock, without the approval of the holders of the Class A Common Stock and the holders of the Class B Common Stock. In some circumstances, the Preferred Stock could be issued and have the effect of preventing a merger, tender offer or other takeover attempt which the Board of Directors opposes.Exhibit

Exhibit 10.123

Federated Hermes, Inc.

Employee Stock Purchase Plan

Effective as of July 1, 1998
Amended through December 31, 2015 
Amended as of January 31, 2020

ARTICLE I - PURPOSE

1.01.    Purpose.  The Federated Hermes, Inc. Employee Stock Purchase Plan (as the same may be amended from time to time, the “Plan”) is intended to provide an arrangement under which employees of Federated Hermes, Inc., a Pennsylvania corporation (the “Company”), and its corporate subsidiaries which have been authorized by the Company to participate in this Plan (“Subsidiaries”) will have an opportunity to acquire a proprietary interest in the Company through the purchase of shares of the Class B Common Stock of the Company.  It is the intention of the Company that the Plan qualify as an “employee stock purchase plan” under Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”), it is actually an open market plan that does not confer tax benefits on participants.    The Plan shall be effective July 1, 1998.

ARTICLE II - DEFINITIONS

2.01.    “Account” shall mean a bookkeeping account to which a Participant’s payroll deductions are credited in accordance with Section 4.02.

2.02.    “Adjustment Transaction” shall have the meaning given to that term in Section 10.04.

2.03.    “Board” shall mean the Board of Directors of the Company.

2.04.    “Code” shall have the meaning given to such term in Section 1.01.

2.05.    “Committee” shall mean the committee described in Article IX.

2.06.    “Common Stock” shall mean the Class B Common Stock, no par value, of the Company.

2.07.    “Company” shall have the meaning given to such term in Section 1.01.

2.08    “Compensation” shall mean, except as set forth below, a Participant’s wages as reported in Box 1 of IRS Form W-2 plus any salary reduction contributions to a 401(k) plan, transportation benefit plan, cafeteria plan or tax deferred annuity which are not includable in the gross income of the Participant.  Compensation shall include all forms of Compensation including 

any lump-sum variable payments that may be paid on a periodic basis. Compensation shall not include any bonus amount, including, but not limited to, payments made under any stock incentive, executive incentive compensation or deferred bonus plans.

2.09.    “Employee” shall mean any person who is (i) employed on a full-time basis by the Company or any of its Subsidiaries or (ii) employed on a part-time basis by the Company or any of its Subsidiaries and who meets the Company’s requirements for benefits eligibility at the beginning of the Offering Period consistent with Section 423(b)(4) of the Code; provided, however, that the following employees shall be excluded from participation in the Plan:  temporary employees whose customary employment is for not more than five months in any calendar year and employees who are non-resident aliens (within the meaning of Section 7701(b)(1)(B) of the Code) and who receive no earned income (within the meaning of Section 911(d)(2) of the Code) from the Company or a Subsidiary which constitutes U.S. source income (within the meaning of Section 861(a)(3) of the Code).  

2.10.    “Fair Market Value” shall mean, as of any applicable date:  (i) if the Common Stock is listed on a national securities exchange or is authorized for quotation on The Nasdaq Stock Market’s National Market (“NNM”), the closing price, regular way, of the Common Stock on such exchange or NNM, as the case may be, or if no such reported sale of the Common Stock shall have occurred on such date, on the next preceding date on which there was such a reported sale; or (ii) if the Common Stock is not listed for trading on a national securities exchange or authorized for quotation on NNM, the closing bid price as reported by The Nasdaq Stock Market or The Nasdaq SmallCap Market (if applicable), or if no such prices shall have been so reported for such date, on the next preceding date for which such prices were so reported; or (iii) if the Common Stock is not listed for trading on a national securities exchange or authorized for quotation on NNM, The Nasdaq Stock Market or The Nasdaq SmallCap Market (if applicable), the last reported bid price published in the “pink sheets” or displayed on the National Association of Securities Dealers, Inc. (“NASD”) Electronic Bulletin Board, as the case may be; or (iv) if the Common Stock is not listed for trading on a national securities exchange, or is not authorized for quotation on NNM, The Nasdaq Stock Market or The Nasdaq SmallCap Market, or is not published in the “pink sheets” or displayed on the NASD Electronic Bulletin Board, the Fair Market Value of the Common Stock as determined in good faith by the Committee.

2.11.    “Five Percent Owner” shall mean an employee of the Company or any of its Subsidiaries who after the grant of an Option under this Plan, would own stock, and/or hold outstanding Options to purchase stock, possessing in the aggregate 5% or more of the total combined voting power or value of all classes of stock of the Company (for purposes of this section, the rules of §424(d) of the Code shall apply in determining stock ownership of any employee); 

2.12.    “Maximum Contribution” shall mean the maximum amount of Compensation which each Employee may deduct for the purpose of purchasing shares of Common Stock under the Plan.  The Maximum Contribution, which shall be ten percent (10%) of Compensation or such other percentage (in whole percentages) of Compensation as may from time to time be determined by the Committee on a uniform basis with respect to all Participants.

2.13    “Minimum Contribution” shall mean 1% of Compensation for any payroll period.

2.14.    “Offering Commencement Date” shall mean each January 1, April 1, July 1 and October 1 during the term of the Plan, beginning July 1, 1998.

2.15.    “Offering Period” shall mean each three-month period beginning on an Offering Commencement Date.

2.16.    “Offering Termination Date” shall mean the last business day of each Offering Period.

2.17.    “Option” shall mean an option to acquire shares of Common Stock deemed to have been granted to a Participant as described in Section 5.03.

2.18.    “Option Price” shall mean the purchase price of shares of Common Stock subject to an Option as described in Section 5.02.

2.19.    “Participant” shall mean an Employee who elects to participate in the Plan in accordance with Article III.

2.20.    “Plan” shall have the meaning given to such term in Section 1.01.

2.21    “Purchase Date” shall mean the tenth (10th) business day following the applicable Offering Termination Date, or such earlier business day on or following the Offering Termination Date as determined by the Company, as of which purchases of Common Stock shall be made with contributions accumulated during a particular Offering Period.  

ARTICLE III - ELIGIBILITY AND PARTICIPATION

3.01.    Initial Eligibility.  Any eligible Employee may participate in the Plan for each Offering Period commencing on or after such Employee’s first day of employment with the Company or any of its Subsidiaries.  

3.02.    Restrictions on Participation.  Notwithstanding any provisions of the Plan to the contrary, no Employee shall be permitted to participate in the Plan or shall be deemed to have been granted an Option under the Plan which permits his or her rights to purchase stock under all employee stock purchase plans (as described in Section 423 of the Code) of the Company and its Subsidiaries to accrue at a rate which exceeds $25,000 (or such other amount as may be the applicable dollar limitation under Section 423(b)(8) of the Code) in Fair Market Value of the Common Stock (determined at the time such Option is granted) for each calendar year in which such Option is outstanding, and no Five Percent Owner shall be granted an Option under the Plan.

3.03.    Commencement of Participation.  An eligible Employee may become a Participant by completing an authorization for a payroll deduction on the form provided by the 

Company and filing it with the Company on or before the due date established for the applicable Offering Period by the Committee or its designee.  Payroll deductions for a Participant, as elected in accordance with Article IV, shall apply to each payroll period the pay date for which occurs during the applicable Offering Period.  Such payroll deduction election shall remain in effect throughout that initial Offering Period and during each subsequent Offering Period until modified or terminated as provided in Section 4.03 and Article VII.

ARTICLE IV - PAYROLL DEDUCTIONS

4.01.    Amount of Deduction.  At the time a Participant files his or her authorization for payroll deduction, he or she shall elect to have deductions made from his or her Compensation on each payday during the time he or she is a Participant of a specified whole percentage of his or her Compensation in an amount not less than the Minimum Contribution and not in excess of the Maximum Contribution. The payroll deduction and subscription agreement shall remain in effect until superseded by a new authorization form. 

4.02.    Participant’s Account.  All payroll deductions made for a Participant shall be credited to his or her Account under the Plan.  A Participant may not make any separate cash payment into such Account.  No interest shall accrue on the amount of payroll deductions credited to a Participant’s Account under the Plan at any time. 

4.03.    Changes in Payroll Deductions.  A Participant may discontinue payroll deductions in the Plan at any time during the Offering Period, provided however that no other change with respect to payroll deductions can be made during an Offering Period.  In such event, no further payroll deductions will be made with respect to such Participant during such Offering Period or any subsequent Offering Period unless such Participant again commences participation in accordance with Section 3.03.  A Participant may elect to change or terminate his or her payroll deductions for a subsequent Offering Period by providing written notice to the Company on or before the due date established for the applicable Offering Period by the Committee or its designee. 

ARTICLE V - OFFERING PERIODS AND GRANTING OF OPTIONS

5.01.    Offering Periods.  Except as otherwise provided in this Plan or as otherwise determined by the Committee, in each calendar year during the term of the Plan there shall be four Offering Periods, beginning on each Offering Commencement Date and ending on the next following Offering Termination Date.  No Offering Period may exceed 27 months in duration.

5.02.    Option Price.  The Option Price with respect to an Offering Period shall be such price as the Committee shall determine; provided, however, that unless and until the Committee decides otherwise, the Option Price shall equal the average price per share actually paid to acquire the shares for the Plan as of the applicable Purchase Date; provided further, however, that in no event shall the Option Price be less than 85% of the lower of:
(a)    the Fair Market Value of the Common Stock on the Offering Commencement Date; or

(b)    the Fair Market Value of the Common Stock on the Offering Termination Date.
5.03.    Number of Option Shares.  Subject to Section 3.02, on the Offering Commencement Date for each Offering Period, a Participant shall be deemed to have been granted an Option to purchase the number of whole and fractional shares (determined to not more than four decimal places) of Common Stock equal to the Participant’s basic or regular rate of compensation with respect to that Offering Period, measured at the beginning of the Offering Period, divided by the closing price of the Common Stock on the first day of the Offering Period; provided, however, that if the number of shares of Common Stock remaining available for issuance under the Plan, is less than the number of shares to be purchased as of an Offering Termination Date, a pro rata allocation of the available shares shall be made consistently with Section 423 of the Code.  Any cash balance remaining in a Participant’s Account following the exercise of Options shall be returned to the Participant, except that any amount remaining which is less than the purchase price of a share (or permitted fractions thereof) shall remain in the Participant’s Account for future Offering Periods.  

ARTICLE VI - EXERCISE OF OPTION

6.01.    Automatic Exercise.  Unless a Participant gives written notice of withdrawal from the Plan to the Company as provided in Article VII prior to the Offering Termination Date of an Offering Period, the Option deemed to have been granted to such Participant under Section 5.03 hereof will be deemed to have been exercised in full automatically on the Purchase Date applicable to such Offering Period; provided, however, if the average price per share of the Common Stock on the Purchase Date is less than 85% of the lower of the prices set forth in Sections 5.02(a) and (b), above, the Option shall not be exercised and Participants’ balances shall be refunded as soon as practicable.

6.02.    Delivery of Common Stock.  Each Participant’s Account shall be credited with the number of whole and fractional shares (determined to not more than four decimal places) of Common Stock purchased on his or her behalf for each Offering Period.  Such Participant shall be deemed to be a shareholder with respect to such shares for all purposes and shall have all of the rights of a shareholder with respect to such shares, including, but not limited to, the right to receive dividends, if any, paid with respect to such shares, which dividends will be paid directly to Participants at the same time as paid to other shareholders.  Promptly after receiving a written request from a Participant, the Company shall deliver to such Participant stock certificate(s) representing all, but not less than all, of the shares of Common Stock purchased on behalf of such Participant under the Plan which have not been previously delivered to such Participant, subject to such Participant’s payment of any transaction costs associated with such transfer; provided, however, that the value of any fractional share shall be paid to the Participant in cash as provided in Section 8.06.

 6.03.    Other Termination of Employment.  Upon termination of the Participant’s employment for any reason , the payroll deductions credited to such Participant’s Account for the Offering Period during which such termination occurs will be returned to him or her (or his or her beneficiary or estate, as applicable) as soon as practicable following the termination of employment, 

without interest.  The Company shall have no liability to any person in the event shares are purchased for a deceased Participant prior to receipt by the Committee of notice of death of the Participant.
ARTICLE VII - WITHDRAWAL

7.01.    In General.  A Participant may withdraw payroll deductions credited to his or her Account during an Offering Period by giving written notice to the Company no later than ten business days prior to the Offering Termination Date of such Offering Period or by such other due date for withdrawal notices the Committee may establish.  All of the payroll deductions credited to a Participant’s Account for such Offering Period, without interest, will be paid to such Participant as soon as practicable following the receipt by the Company of the written notice. 

7.02.    Effect on Subsequent Participation.  A Participant who withdraws from the Plan shall be eligible to participate again in the Plan beginning with the first Offering Period which commences after the date of withdrawal. 

ARTICLE VIII - STOCK

8.01.    Maximum Shares.  The maximum number of shares of Common Stock which shall be issued under the Plan (subject to adjustment pursuant to Section 10.04) during the term hereof shall be 750,000 shares.  Such shares may be purchased in the open market or may be authorized but unissued shares or treasury shares, as the Committee may determine.  If an Option shall expire or terminate without being exercised in full, any shares not purchased pursuant to such Option shall again be available for granting Options hereunder.

8.02.    Participant’s Interest in Option Stock.  The Participant will have no interest in the shares of Common Stock covered by an Option deemed to have been granted hereunder until such Option has been exercised under Section 6.01.

8.03.    Registered Ownership of Common Stock.  Shares of Common Stock to be delivered to a Participant under the Plan will be registered in the name of the Participant, or, if the Participant so directs by written notice to the Company prior to the Offering Termination Date applicable thereto, in the names of the Participant and one such other person as may be designated by the Participant, as joint tenants with rights of survivorship or as tenants by the entireties, to the extent permitted by applicable law.

8.04.    Restrictions on Exercise.  The Board may, in its discretion, require as conditions to the exercise of any Option that the shares of Common Stock reserved for issuance upon the exercise of the Option shall have been duly listed, upon official notice of issuance, on a stock exchange or NNM, and that either:
(a)    a Registration Statement under the Securities Act of 1933, as amended, with respect to said shares shall be effective, or

(b)    the Participant shall have represented at the time of purchase, in form and substance satisfactory to the Company, that it is his or her intention to purchase the shares for investment and not for resale or distribution.
8.05    Restrictions on Shares.  The Committee shall have the authority to impose transfer restrictions on the shares of Common Stock purchased under the Plan and to place restrictive legends on the certificates for such restricted shares; provided, however, that if any such restrictions are to apply to shares of Common Stock purchased for an Offering Period, then prior to the due date for Participant payroll deduction elections for such Offering Period, the Committee shall notify prospective Participants of the nature of such restrictions. 
8.06.    Establishment of Account With Transfer Agent.  By enrolling in the Plan, each Participant will be deemed to have authorized the establishment of an account in his or her name with the Company’s transfer agent for the Common Stock and to have consented to the sharing by such transfer agent with the Company of information regarding the disposition of shares from said account.  With respect to any fractional shares credited to such account, upon the withdrawal of such fractional shares from the account for any reason:
(a)    the Participant will receive cash in lieu of such fractional shares,
(b)    such cash will be payable solely from proceeds of the sale of underlying whole shares held by the Plan, net of any fees and commissions incurred on such sale; and
(c)    the Company’s transfer agent shall determine the time and manner of the sale of underlying whole shares held by the Plan in accordance with its standard procedures for transacting in fractional shares.
With respect to transfer shares to a brokerage account, the Transfer Agent may: 
		
	(a)
	issue the shares directly to the Participant then the Participant would forward the certificate to broker, or 

		
	(b)
	the Participant may provide the broker name, address and Participant account number for certificate to be forwarded directly to broker.  

ARTICLE IX - ADMINISTRATION

9.01.    Appointment of Committee.  The Board shall appoint a Committee to administer the Plan, which shall consist of no fewer than two non-employee members of the Board.  No member of the Committee shall be eligible to purchase Common Stock under the Plan.  The Committee may, subject to compliance with applicable legal requirements, delegate such of its powers and authority under the Plan as it deems appropriate to designated officers or employees of the Company.  In addition, the Board may exercise any of the authority conferred upon the Committee hereunder.  In the event of any such delegation of authority or exercise of authority by the Board, 

references in the Plan to the Committee shall be deemed to refer to the delegate of the Committee or the Board, as the case may be.

9.02.    Authority of Committee.  Subject to the express provisions of the Plan, the Committee shall have plenary authority in its sole and absolute discretion to interpret and construe any and all provisions of the Plan, to adopt rules and regulations for administering the Plan, and to make all other determinations deemed necessary or advisable for administering the Plan.  The Committee’s determination on the foregoing matters shall be conclusive.

ARTICLE X - MISCELLANEOUS

10.01.    Designation of Beneficiary.  A Participant may file a written designation of a beneficiary for purposes of receiving amounts of cash credited to a Participant’s account, provided that any shares acquired by a Participant will be distributed to the Participant’s estate upon the death of the Participant.  Such designation of beneficiary may be changed by the Participant at any time by written notice to the Company.  In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant’s death, the beneficiary shall be the executor or administrator of the estate of the Participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the beneficiary shall be, in the sole and absolute discretion of the Company, the spouse or any one or more dependents of the Participant.  No beneficiary shall, prior to the death of the Participant by whom he or she has been designated, acquire any interest under the Plan.

10.02.    Transferability.  Neither payroll deductions credited to a Participant’s Account nor any rights with regard to the exercise of an Option or to receive Common Stock under the Plan may be assigned, transferred, pledged, or otherwise disposed of in any way by the Participant other than by will or the laws of descent and distribution.  Any such attempted assignment, transfer, pledge or other disposition shall be without effect, except that the Company may, in its sole discretion, treat such act as an election to withdraw funds in accordance with Section 7.01.

10.03.    Use of Funds.  All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose and the Company shall not be obligated to segregate such payroll deductions or any Accounts.

10.04.    Equitable Adjustment.  If, while any Options are outstanding, the outstanding shares of Common Stock of the Company have increased, decreased, changed into, or been exchanged for a different number or kind of shares or securities of the Company or any other entity through reorganization, merger, recapitalization, reclassification, stock split, reverse stock split or other transaction (an “Adjustment Transaction”), appropriate and proportionate adjustments may be made by the Committee in the number and/or kind of shares which are subject to purchase under outstanding Options, and/or the Option Price applicable to such outstanding Options or the Committee, if it deems it appropriate, may convert Options into the right to receive cash or other property pursuant to the Adjustment Transaction.  In addition, in any such event, the number and/or kind of shares which may be offered for purchase under the Plan may also be proportionately adjusted if deemed appropriate by the Committee.

10.05.    Amendment and Termination.  The Company, through any of its officers, shall have complete power and authority to terminate or amend the Plan.  No termination, modification, or amendment of the Plan may, without the consent of a Participant then having an unexercised Option under the Plan, adversely affect the rights of such Participant with respect to such Option.

10.06.    Costs and Expenses.  No brokerage commissions or other transaction costs and fees shall be charged by the Company in connection with the purchase of shares under the Plan.  All other costs and expenses incurred in administering the Plan shall be borne by the Company; provided that any commissions or other transactions costs incurred in the sale of Common Stock by a Participant, the transfer of Common Stock to another brokerage account established by a Participant, or the transfer of stock certificates to a Participant shall be passed through to and paid by such Participant. The Company or its transfer agent may deduct the amount of such commissions or transactions costs from the proceeds of any sale of the Common Stock by a Participant or from amounts credited to a Participant’s Account.  Any amounts credited to Accounts shall constitute general assets of the Company and nothing in the Plan shall be construed to create a trust or fiduciary relationship with respect to such Accounts.

10.07.    No Employment Rights.  The Plan does not, directly or indirectly, create any right for the benefit of any Employee or class of Employees to purchase any shares under the Plan, or create in any Employee or class of Employees any right with respect to continuation of employment by the Company and it shall not be deemed to interfere in any way with the Company’s right to terminate, or otherwise modify, an Employee’s employment at any time.

10.08.    Governing Law.  The law of the Commonwealth of Pennsylvania, other than the conflict of laws provisions of such law, will govern all matters relating to the Plan.

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