Document:

Exhibit
10.46

SIXTH
AMENDMENT TO

AMENDED
AND RESTATED LOAN AND SECURITY AGREEMENT AND

MODIFICATION OF AMENDED AND RESTATED REVOLVING CREDIT NOTE

This Sixth Amendment to Amended and
Restated Loan and Security Agreement and Modification of Amended and Restated
Revolving Credit Note (the “Sixth Amendment”), dated as of the 10th day of December, 2006 is made by and among IWT
TESORO CORPORATION, a Nevada corporation with its chief executive office and
principal place of business at Suite 10, 191 Post Road West, Westport,
Connecticut 06880, INTERNATIONAL WHOLESALE TILE, INC., a Florida corporation
with its chief executive office and principal place of business at 3500 S.W. 42nd Avenue, Palm City, Florida 34990; THE TILE
CLUB, INC., a Delaware corporation with its chief executive office and
principal place of business at Suite 10, 191 Post Road West, Westport,
Connecticut 06880 (“The Tile Club”), and TESORO DIRECT, INC. f/k/a IMPORT
FLOORING GROUP, INC., a Delaware corporation with its chief executive office
and principal place of business at Suite 10, 191 Post Road West, Westport,
Connecticut 06880 (“Tesoro”) (jointly and severally and together with their
successors and assigns, collectively, the “Borrower”) and BANK OF AMERICA,
N.A., with an office at 200 Glastonbury Boulevard, Glastonbury, Connecticut
06033 (the “Lender”).

W I T N E S S E T H:

WHEREAS, Borrower and the Lender are parties to a certain Amended and
Restated Loan and Security Agreement dated as of December 31, 2004, as amended
by that certain First Amendment to Amended and Restated Loan and Security
Agreement dated April 25, 2005, that certain Second Amendment to Amended and
Restated Loan and Security Agreement dated June 30, 2005, that certain Third
Amendment to Amended and Restated Loan and Security Agreement dated November
17, 2005, that certain Fourth Amendment to Amended and Restated Loan and
Security Agreement dated March 31, 2006 and that certain Fifth Amendment to
Amended and Restated Loan and Security Agreement dated September 5, 2006
(collectively, the “Loan Agreement”), pursuant to which the Lender agreed to
extend to Borrower a revolving loan in the principal amount of up to
$26,500,000 (“Loan”); and

WHEREAS, the Loan is evidenced by that certain Second Amended and
Restated Revolving Credit Note dated as of September 5, 2006 in the original
principal amount of Twenty-Six Million Five Hundred Thousand and 00/100 Dollars
($26,500,000.00) (the “Note”); and

WHEREAS, Borrower and Lender desire to amend the Loan Agreement and the
Note in certain respects; and

WHEREAS, Section 11.3 of the Loan Agreement provides, in part, that no
modification or amendment of the Loan Agreement shall be effective unless the
same shall be in writing and signed by the parties thereto;

NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

1.             Defined Terms.
Capitalized terms used in this Sixth Amendment which are defined in the Loan
Agreement shall have the same meanings as defined therein, unless otherwise
defined herein.

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2.             Amendment of Loan Agreement.

(a)           Section
4.1 of the Loan Agreement, entitled “Term of the Agreement”, is hereby
deleted in its entirety and replaced with the following:

4.1           Term of Agreement.  Subject to Lender’s right to cease making
Loans to Borrower upon or after the occurrence of any Default or Event of
Default, this Agreement shall be in effect for a period, through and including
March 10, 2007 (the “Term”).

(b)         Appendix A of the Loan Agreement,
entitled “General Definitions”, is hereby deleted in its entirety and
replaced with the Following:

Guarantors — means individually and collectively IWT
Tesoro International, Ltd, a Bermuda exempt company with a chief executive
office located at Suite 10, 191 Post Road West, Westport, Connecticut 06880,
IWT Tesoro Transport, Inc., a Florida corporation with a chief executive office
located at Suite 10, Post Road West, Westport, Connecticut 06880, The Tile
Club, Inc., a Delaware corporation with its chief executive office located at
Suite 10, 191 Post Road West, Westport, Connecticut 06880 and American Gres,
Inc., a Delaware corporation with its chief executive office located at Suite
10, 191 Post Road West, Westport, Connecticut 06880 and any other Person who
may hereafter guarantee payment or performance of the whole or any part of the
Obligations.

3.             Amendment of Note.  The Note is hereby amended by deleting the
phrase, “December 10, 2006” in the tenth (10th) line of the first (1st) paragraph thereof and replacing it with
the phrase, “March 10, 2007”.

4.             No
Other Changes. Except as explicitly amended by this Sixth Amendment, all of
the terms and conditions of the Loan Agreement shall remain in full force and
effect and shall apply to any loan, letter of credit or swing line loans
thereunder.

5.             Representations
and Warranties. Borrower hereby represents and warrants to Lender as
follows:

(a)           Borrower has all
requisite power and authority to execute this Sixth Amendment and to perform all of its obligations
hereunder, and this Sixth Amendment has
been duly executed and delivered by Borrower and constitutes the legal, valid and binding
obligation of Borrower, enforceable in accordance with its terms.

(b)           The execution,
delivery and performance by Borrower of this Sixth Amendment have been duly
authorized by all necessary corporate action and do not (i) require any
authorization, consent or approval by any governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
(ii) violate any provision of any law, rule or regulation or of any order,
writ, injunction or decree presently in effect, having applicability to
Borrower, or the articles of incorporation or by-laws of Borrower, or
(iii) result in a breach of or constitute a default under any indenture or
loan or credit agreement or any other agreement, lease or instrument to which
Borrower is a party or by which it or its properties may be bound or affected.

(c)           All of the
representations and warranties contained in Section 7 of the Loan Agreement are
correct on and as of the date hereof as though made on and as of such date,
except to the extent that such representations and warranties relate solely to
an earlier date.

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6.             References.
All references in the Loan Agreement to “this Agreement” shall be deemed to
refer to the Loan Agreement as amended hereby; and any and all references in
the Loan Documents to the Loan Agreement shall be deemed to refer to the Loan
Agreement as amended hereby.

7.             Release.
Borrower hereby absolutely and unconditionally releases and forever discharges
the Lender, and any and all participants, parent corporations, subsidiary
corporations, affiliated corporations, insurers, indemnitors, successors and
assigns thereof, together with all of the present and former directors,
officers, agents and employees of any of the foregoing, from any and all
claims, demands or causes of action of any kind, nature or description, whether
arising in law or equity or upon contract or tort or under any state or federal
law or otherwise, which Borrower has had, now has or has made claim to have
against any such person for or by reason of any act, omission, matter, cause or
thing whatsoever arising from the beginning of time to and including the date
of this Sixth Amendment, whether such claims, demands and causes of action are
matured or unmatured or known or unknown.

8.             Confirmation of
other Loan Documents.  Borrower
agrees notwithstanding the amendment of the Loan Agreement pursuant to this
Sixth Amendment, that the other Loan Documents and its agreements, covenants,
obligations, representations and warranties thereunder and therein are hereby
expressly ratified, confirmed and restated.

9.             Benefit.  This Sixth Amendment shall inure to the
benefit of and bind the parties hereto and their respective successors and
assigns.

10.           Fees and Expenses.  Borrower agrees to pay:

(a)           the reasonable legal
and other fees, commissions, costs, charges, taxes and other expenses incurred
by Lender in connection with the preparation, execution and delivery of this
Sixth Amendment; and the fees and disbursements of Lender’s counsel; and

(b)           an amendment fee in
the amount of Twenty-Five Thousand and 00/100 Dollars ($25,000.00), which
amendment fee is deemed upon receipt by Lender fully earned and non-refundable
under any circumstances.

11.           Limitation.  The foregoing does not constitute an
agreement by the Lender to consent to additional transactions or amendments to
the various provisions of the Loan Agreement. 
The Borrower hereby acknowledges that the Lender shall be entitled to
require strict compliance by the Borrower with the Loan Agreement and the Loan
Documents.

12.           Miscellaneous.  This Sixth Amendment may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original and all of which counterparts, taken together, shall
constitute one and the same instrument.

[signature page follows]

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IN WITNESS WHEREOF, the
parties hereto have caused this Sixth Amendment to be duly executed as of the
date first written above.

 

	
  

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  IWT TESORO
  CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Henry J.
  Boucher, Jr.

  
	
   

  	
   

  	
  Its President

  
	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  INTERNATIONAL
  WHOLESALE TILE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Paul F. Boucher

  
	
   

  	
   

  	
  Its President

  
	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE TILE CLUB,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Henry J.
  Boucher, Jr.

  
	
   

  	
   

  	
  Its President

  
	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TESORO DIRECT,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Henry J.
  Boucher, Jr.

  
	
   

  	
   

  	
  Its President

  
	
   

  	
   

  	
  Duly Authorized

  
	
   

  	
   

  

 

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  LENDER:

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA,
  N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Deirdre Sikora

  
	
   

  	
   

  	
  Its Vice
  President

  
	
   

  	
   

  	
  Duly Authorized

  

 

 8Exhibit
10.20

CPI INTERNATIONAL, INC.

2004 STOCK INCENTIVE PLAN

(Reflecting September 24, 2004 and December 7,
2006 Amendments)

1.                                       Purpose
of the Plan

The purpose of the Plan (as defined below) is to aid
the Company (as defined below) and its Affiliates (as defined below) in
recruiting and retaining key employees, directors or consultants of outstanding
ability and to motivate such employees, directors or consultants to exert their
best efforts on behalf of the Company and its Affiliates by providing incentives
through the granting of Awards (as defined below).  The Company expects that it will benefit from
the added interest which such key employees, directors or consultants will have
in the welfare of the Company as a result of their proprietary interest in the
Company’s success.

2.                                       Definitions

The following
capitalized terms used in the Plan have the respective meanings set forth in
this Section:

(a) Act:  The Securities Exchange Act of 1934, as
amended, or any successor thereto.

(b) Affiliate:  With respect to any Person, any other Person,
directly or indirectly, controlling, controlled by or under common control with
such Person or any other Person designated by the Committee in which any Person
has an interest.

(c) Award:  Any Option, Stock Appreciation Right, or
Other Stock-Based Award granted pursuant to the Plan.

(d) Award Agreement:  Any written agreement, contract, or other
instrument or document evidencing any Award, which may, but need not, be
executed or acknowledged by a Participant.

(e) Board:  The Board of Directors of the Company.

(f) Change in Control:  The occurrence of any of the following
events: (i) the sale or disposition, in one or a series of related
transactions, of all or substantially all of the assets of the Company to any “person”
or “group” (as such terms are defined in Sections 13(d)(3) and 14(d)(2) of the
Act) other than Cypress or its Affiliates or (ii) any person or group, other
than Cypress or its Affiliates, is or becomes the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Act), directly or indirectly, of
more than 50% of the total voting power of the voting stock of the Company,
including by way of merger, consolidation or otherwise and Cypress or its
Affiliates ceases to control the Board.

(g) Code:  The Internal Revenue Code of 1986, as
amended, or any successor thereto.

 

(h) Committee:  A committee of the Board designated by the
Board.

(i) Company:  CPI International, Inc.

(j) Cypress:  The affiliated funds of The Cypress Group
L.L.C. that have made, or are making, equity investments in the Company.

(k) Effective Date:  The date the Board adopts the Plan.

(l) Employment:  (i) a
Participant’s employment, if the Participant is an employee of the Company or
any of its Affiliates, (ii) a Participant’s services as a consultant, if the
Participant is a consultant to the Company or any of its Affiliates and (iii) a
Participant’s services as a non-employee director, if the Participant is a
non-employee member of the Board or the board of directors of an Affiliate of
the Company; provided, however, that unless otherwise determined
by the Committee, a change in a Participant’s status from employee to
non-employee (other than a director of the Company or any of its Affiliates)
shall constitute a termination of employment hereunder.

(m) Fair Market Value:  On
a given date, (i) if there is a public market for the Shares on such date, the
average of the high and low closing bid prices of the Shares on such stock
exchange on which the Shares are principally trading on the date in question,
or, if there were no sales on such date, on the closest preceding date on which
there were sales of Shares, or (ii) if there is no public market for the Shares
on such date, the fair market value of the Shares as determined in good faith by
the Board.

(n) ISO:  An Option that
is also an incentive stock option granted pursuant to Section 6(d) of the Plan.

(o) Option:  A stock
option granted pursuant to Section 6 of the Plan.

(p) Option Price:  The
purchase price per Share of an Option, as determined pursuant to Section 6(a)
of the Plan.

(q) Other Stock-Based Award: 
Any award granted under Section 8 of the Plan.

(r) Participant:  An
employee, director or consultant of the Company or its Affiliates who is
selected by the Committee to participate in the Plan.

(s) Person:  Any
individual, firm, corporation, partnership, limited liability company, trust,
incorporated or unincorporated association, joint venture, joint stock company,
governmental body or other entity of any kind.

(t) Plan:  CPI International,
Inc. 2004 Stock Incentive Plan.

(u) Shares:  Shares of
common stock of the Company.

(v) Stock Appreciation Right: 
Any right granted under Section 7 of the Plan.

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(w) Subsidiary:  A subsidiary corporation, as defined in
Section 424(f) of the Code (or any successor section thereto), of the Company.

3.                                       Shares
Subject to the Plan

The total number of Shares which may be issued under
the Plan is 2,179,232.  The Shares may
consist, in whole or in part, of unissued Shares or treasury Shares.  The issuance of Shares or the payment of cash
upon the exercise of an Award shall reduce the total number of Shares available
under the Plan, as applicable.  Shares
which are subject to Awards (or a portion thereof) that terminate or lapse may
be granted again under the Plan.

4.                                       Administration

(a) The Plan shall be administered by the Committee, which may delegate
its duties and powers in whole or in part as it determines; provided, however,
that the Board may, in its sole discretion, take any action designated to the
Committee under this Plan as it may deem necessary.

(b) The Committee shall have the full power and authority to make, and
establish the terms and conditions of, any Award to any Person eligible to be a
Participant, consistent with the provisions of the Plan and to waive any such
terms and conditions at any time (including, without limitation, accelerating
or waiving any vesting conditions). 
Awards may, in the discretion of the Committee, be made under the Plan
in assumption of, or in substitution for, outstanding awards previously granted
by the Company or its Affiliates or a company acquired by the Company or with
which the Company combines.  The number
of Shares underlying such substitute awards shall be counted against the
aggregate number of Shares available for Awards under the Plan.

(c) The Committee is authorized to interpret the Plan, to establish,
amend and rescind any rules and regulations relating to the Plan, and to make
any other determinations that it deems necessary or desirable for the administration
of the Plan, and may delegate such authority, as it deems appropriate.  The Committee may correct any defect or
supply any omission or reconcile any inconsistency in the Plan in the manner
and to the extent the Committee deems necessary or desirable.  Any decision of the Committee in the
interpretation and administration of the Plan, as described herein, shall lie
within its sole and absolute discretion and shall be final, conclusive and
binding on all parties concerned (including, but not limited to, Participants
and their beneficiaries or successors).

(d) The Committee shall require payment of any amount it may determine
to be necessary to withhold for federal, state, local, or other taxes as a
result of the exercise, grant or vesting of an Award.  Unless the Committee specifies otherwise, the
Participant may elect to pay a portion or all of such withholding taxes by (i)
delivery in Shares or (ii) having Shares withheld by the Company with a Fair
Market Value equal to the minimum statutory withholding rate from any Shares
that would have otherwise been received by the Participant.

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5.             Limitations

No Awards may be granted under the Plan after the
tenth anniversary of the Effective Date, but Awards theretofore granted may
extend beyond that date.

6.                                       Options

Options granted under the Plan shall be, as determined
by the Committee, non-qualified stock options or ISOs for federal income tax
purposes, as evidenced by the related Award Agreements, and shall be subject to
the foregoing and the following terms and conditions and to such other terms
and conditions, not inconsistent therewith, as the Committee shall determine:

(a) Option Price.  The
Option Price shall be determined by the Committee, but, with respect to ISOs,
shall not be less than 100% of the Fair Market Value of the Shares on the date
an Option is granted.

(b) Exercisability. 
Options granted under the Plan shall be exercisable at such time and
upon such terms and conditions as may be determined by the Committee, but in no
event shall an Option be exercisable more than ten years after the date it is
granted.

(c) Exercise of Options. 
Except as otherwise provided in the Plan or in an Award Agreement, an
Option may be exercised for all, or from time to time any part, of the Shares
for which it is then exercisable.  For
purposes of this Section 6, the exercise date of an Option shall be the date a
notice of exercise is received by the Company, together with payment (or to the
extent permitted by applicable law, provision for payment) of the full purchase
price in accordance with this Section 6(c). 
The purchase price for the Shares as to which an Option is exercised
shall be paid to the Company as designated by the Committee, pursuant to one or
more of the following methods: (i) in cash, or its equivalent (e.g., by check),
(ii) in Shares having a Fair Market Value equal to the aggregate Option Price
for the Shares being purchased and satisfying such other requirements as may be
imposed by the Committee; provided that such Shares have been held by the
Participant for no less than six months (or such other period as established
from time to time by the Committee or generally accepted accounting
principles); (iii) partly in cash and partly in such Shares; (iv) if there is a
public market for the Shares at such time, subject to such rules as may be
established by the Committee, through delivery of irrevocable instructions to a
broker to sell the Shares otherwise deliverable upon the exercise of the Option
and to deliver promptly to the Company an amount equal to the aggregate Option
Price for the Shares being purchased or (v) such other method as approved by
the Committee.  No Participant shall have
any rights to dividends or other rights of a stockholder with respect to Shares
subject to an Option until the Participant has given written notice of exercise
of the Option, paid in full for such Shares and, if applicable, has satisfied
any other conditions imposed by the Committee pursuant to the Plan.

(d) ISOs.  The Committee
may grant Options under the Plan that are intended to be ISOs.  Such ISOs shall comply with the requirements
of Section 422 of the Code.  No ISO may
be granted to any Participant who at the time of such grant is not an employee
of the Company or of any of its Subsidiaries. 
In addition, no ISO may be granted to any Participant 

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who at the
time of such grant owns more than 10% of the total combined voting power of all
classes of stock of the Company or of any of its Subsidiaries, unless
(i) the Option Price for such ISO is at least 110% of the Fair Market
Value of a Share on the date the ISO is granted and (ii) the date on which
such ISO terminates is a date not later than the day preceding the fifth
anniversary of the date on which the ISO is granted.  Any Participant who disposes of Shares
acquired upon the exercise of an ISO either (I) within two years after the
date of grant of such ISO or (II) within one year after the transfer of
such Shares to the Participant, shall notify the Company of such disposition
and of the amount realized upon such disposition.  All Options granted under the Plan are
intended to be non-qualified stock options, unless the applicable Award
Agreement expressly states that the Option is intended to be an ISO.  If an Option is intended to be an ISO, and if
for any reason such Option (or portion thereof) shall not qualify as an ISO,
then, to the extent of such nonqualification, such Option (or portion thereof)
shall be regarded as a non-qualified stock option granted under the Plan; provided
that such Option (or portion thereof) otherwise complies with the Plan’s
requirements relating to non-qualified stock options.  In no event shall any member of the
Committee, the Company or any of its Affiliates (or their respective employees,
officers or directors) have any liability to any Participant (or any other
Person) due to the failure of an Option to qualify for any reason as an ISO.

(e) Attestation.  Wherever
in this Plan or any Award Agreement a Participant is permitted to pay the
Option Price or taxes relating to the exercise of an Option by delivering
Shares, the Participant may, subject to procedures satisfactory to the
Committee, satisfy such delivery requirement by presenting proof of beneficial
ownership of such Shares, in which case the Company shall treat the Option as
exercised without further payment and shall withhold such number of Shares from
the Shares acquired by the exercise of the Option.

7.                                       Stock
Appreciation Rights

(a) Grants.  The Committee
may grant (i) a Stock Appreciation Right independent of an Option or
(ii) a Stock Appreciation Right in connection with an Option, or a portion
thereof.  A Stock Appreciation Right
granted pursuant to clause (ii) of the preceding sentence (A) may be
granted at the time the related Option is granted or at any time prior to the
exercise or cancellation of the related Option, (B) shall cover the same
number of Shares covered by an Option (or such lesser number of Shares as the
Committee may determine) and (C) shall be subject to the same terms and
conditions as such Option except for such additional limitations as are
contemplated by this Section 7 (or such additional limitations as may be
included in an Award agreement).

(b) Terms.  The exercise
price per Share of a Stock Appreciation Right shall be an amount determined by
the Committee but in no event shall such amount be less than the Fair Market
Value of a Share on the date the Stock Appreciation Right is granted; provided,
however, that notwithstanding the foregoing, in the case of a Stock
Appreciation Right granted in conjunction with an Option, or a portion thereof,
the exercise price may not be less than the Option Price of the related
Option.  Each Stock Appreciation Right
granted independent of an Option shall entitle a Participant upon exercise to
an amount equal to (i) the excess of (A) the Fair Market Value on the
exercise date of one Share over (B) the exercise price per Share, times
(ii) the number of Shares covered by the Stock Appreciation Right.  Each Stock Appreciation Right granted in
conjunction with an Option, or a portion thereof, shall entitle a Participant
to 

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surrender to
the Company the unexercised Option, or any portion thereof, and to receive from
the Company in exchange therefor an amount equal to (I) the excess of
(y) the Fair Market Value on the exercise date of one Share over
(z) the Option Price per Share, times (II) the number of Shares
covered by the Option, or portion thereof, which is surrendered.  Payment shall be made in Shares or in cash,
or partly in Shares and partly in cash (any such Shares valued at such Fair
Market Value), all as shall be determined by the Committee.  Stock Appreciation Rights may be exercised
from time to time upon actual receipt by the Company of written notice of
exercise stating the number of Shares with respect to which the Stock
Appreciation Right is being exercised. 
The date a notice of exercise is received by the Company shall be the
exercise date.  No fractional Shares will
be issued in payment for Stock Appreciation Rights, but instead cash will be
paid for a fraction or, if the Committee should so determine, the number of
Shares will be rounded downward to the next whole Share.

(c) Limitations.  The
Committee may impose, in its discretion, such conditions upon the
exercisability or transferability of Stock Appreciation Rights as it may deem
fit.

8.                                       Other
Stock-Based Awards

The Committee, in its sole discretion, may grant
Awards of Shares, Awards of restricted Shares, Awards of phantom stock units
and other Awards that are valued in whole or in part by reference to, or are
otherwise based on the Fair Market Value of, Shares (“Other Stock-Based Awards”).  Such Other Stock-Based Awards shall be in
such form, and dependent on such conditions, as the Committee shall determine,
including, without limitation, the right to receive one or more Shares (or the
equivalent cash value of such Shares) upon the completion of a specified period
of service, the occurrence of an event and/or the attainment of performance
objectives.  Other Stock-Based Awards may
be granted alone or in addition to any other Awards granted under the
Plan.  Subject to the provisions of the
Plan, the Committee shall determine: (a) the number of Shares to be awarded
under (or otherwise related to) such Other Stock-Based Awards; (b) whether such
Other Stock-Based Awards shall be settled in cash, Shares or a combination of
cash and Shares; and (c) all other terms and conditions of such Other
Stock-Based Awards (including, without limitation, the vesting provisions
thereof and provisions ensuring that all Shares so awarded and issued shall be
fully paid and non-assessable).

9.                                       Adjustments
Upon Certain Events

Notwithstanding any other provisions in the Plan to
the contrary, the following provisions shall apply to all Awards granted under
the Plan:

(a) Generally.  In the
event of any change in the outstanding Shares after the Effective Date by
reason of any Share dividend or split, reorganization, recapitalization,
merger, consolidation, spin-off, combination or transaction or exchange of
Shares or other corporate exchange, or any distribution to shareholders of
Shares (but excluding any cash distribution or dividend) or any transaction
similar to the foregoing, the Committee shall make equitable, proportionate and
appropriate substitutions or adjustments as to (i) the number or kind of Shares
or other securities issued or reserved for issuance pursuant to the Plan or
pursuant to outstanding Awards, (ii) the Option Price or exercise price of any
Stock Appreciation Right and/or (iii) any other affected terms of such
Awards.  Adjustments under this Section
9(a) shall be made by the 

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Committee,
whose determination as to what adjustments shall be made, and the extent
thereof, shall be final, binding and conclusive.

(b) Change in Control.  In
the event of a Change in Control after the Effective Date, the Committee may,
but shall not be obligated to, (i) accelerate, vest or cause the restrictions
to lapse with respect to, all or any portion of an Award or (ii) cancel Awards
for fair value (as determined in the sole discretion of the Committee) which,
in the case of Options and Stock Appreciation Rights, may equal the excess, if
any, of the value of the consideration to be paid in the Change in Control
transaction to holders of the same number of Shares subject to such Options or
Stock Appreciation Rights (or, if no consideration is paid in any such
transaction, the Fair Market Value of the Shares subject to such Options or
Stock Appreciation Rights) over the aggregate exercise price of the Shares
subject to such Options or Stock Appreciation Rights or (iii) provide for the
issuance of substitute Awards that will substantially preserve the otherwise
applicable terms of any affected Awards previously granted hereunder as
determined by the Committee in its sole discretion or (iv) provide that for a
period of at least 15 days prior to the Change in Control, such Options shall
be exercisable as to all Shares subject thereto and that upon the occurrence of
the Change in Control, such Options shall terminate and be of no further force
and effect.

10.                                 No
Right to Employment or Awards

The granting of an Award under the Plan shall impose
no obligation on the Company or any of its Affiliates to continue the
Employment of a Participant and shall not lessen or affect the Company’s or its
Affiliates’ rights to terminate the Employment of such Participant.  No Participant or other Person shall have any
claim to be granted any Award, and there is no obligation for uniformity of
treatment of Participants or holders or beneficiaries of Awards.  The terms and conditions of Awards and the
Committee’s determinations and interpretations with respect thereto need not be
the same with respect to each Participant (whether or not such Participants are
similarly situated).

11.                                 Successors
and Assigns

The Plan shall be binding on all successors and
assigns of the Company and a Participant, including without limitation, the
estate of such Participant and the executor, administrator or trustee of such
estate, or any receiver or trustee in bankruptcy or representative of the
Participant’s creditors.

12.                                 Nontransferability
of Awards

Unless otherwise determined by the Committee, an Award
shall not be transferable or assignable by the Participant other than by will
or by the laws of descent and distribution. 
An Award exercisable after the death of a Participant may be exercised
by the legatees, personal representatives or distributees of the Participant.

 7
 

 

13.           Awards Subject to the Plan

In the event of a conflict between any term or
provision contained in the Plan and a term or provision in any Award Agreement,
the applicable terms and provisions of the Plan will govern and prevail.

14.                                 Severability

If any provision of the Plan or any Award is, becomes
or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as
to any Person or Award, or would disqualify the Plan or any Award under any law
deemed applicable by the Committee, such provision shall be construed or deemed
amended to conform to the applicable laws, or if it cannot be construed or deemed
amended without, in the determination of the Committee, materially altering the
intent of the Plan or the Award, such provision shall be stricken as to such
jurisdiction, Person or Award and the remainder of the Plan and any such Award
shall remain in full force and effect.

15.                                 Amendments
or Termination

(a) Amendments or Termination of the Plan.  The Committee may amend, alter or discontinue
the Plan, but no amendment, alteration or discontinuation shall be made,
without the written consent of a Participant, if such action would diminish any
of the rights of the Participant under any Award theretofore granted to such
Participant under the Plan; provided, however, that the Committee
may amend the Plan in such manner as it deems necessary to permit the granting
of Awards meeting the requirements of the Code or other applicable laws.

(b) Amendments to Awards. 
The Committee may waive any conditions or rights under, amend any terms
of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore
granted, prospectively or retroactively; provided that no waiver,
amendment, alteration, suspension, discontinuation, cancellation or termination
shall impair the rights of any Participant or any holder or beneficiary of any
Award theretofore granted without the consent of the affected Participant,
holder or beneficiary.

16.                                 Other
Benefit Plans

All Awards shall constitute a special incentive
payment to the Participant and shall not be taken into account in computing the
amount of salary or compensation of the Participant for the purpose of
determining any benefits under any pension, retirement, profit-sharing, bonus,
life insurance or other benefit plan of the Company or any of its Affiliates or
under any agreement between the Company or any of its Affiliates, as the case
may be, and the Participant, unless such plan or agreement specifically
provides otherwise.

17.                                 Choice
of Law

The Plan shall be governed by and construed in
accordance with the laws of the State of New York without regard to conflicts
of laws, and except as otherwise provided in the pertinent Award Agreement, any
and all disputes between a Participant and the Company or any Affiliate
relating to an Award shall be brought only in a state or federal court of
competent jurisdiction sitting in New York, New York.

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18.           Effectiveness of the Plan

The Plan shall be effective as of the Effective Date.

 

 9

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