Document:

Internet America, Inc. 2004 Non-Employee Director Plan

 Exhibit 4.1 
  

INTERNET AMERICA, INC. 
  
 2004 NON-EMPLOYEE DIRECTOR PLAN 
  
 This 2004 Non-Employee Director Stock Option Plan (this “Plan”) is
an equity incentive plan for non-employee directors of Internet America, Inc. (the “Company”) and is intended to advance the best interests of the Company, its subsidiaries and its shareholders by providing the Company’s non-employee
directors an opportunity to obtain or increase their proprietary interest in the success of the Company and its subsidiaries by becoming owners of the common stock, $0.01 par value, of the Company (the “Stock”) or, in the event that the
outstanding shares of common stock are later changed into or exchanged for a different class of stock or securities of the Company or another corporation, that other stock or security. This Plan will be beneficial to the Company and its shareholders
since it will allow these directors to have a greater personal financial stake in the Company through the ownership of Stock of the Company, in addition to underscoring their common interest with shareholders in increasing the value of the Company
over the long term. 
  

	1.	Eligibility. 

  
 All members of the Company’s Board of Directors who are not current employees of the Company or any of its subsidiaries (“Non-Employee
Directors”) are eligible to participate in this Plan. 
  

	2.	Options. 

  
 The term “Option” means an option to purchase shares of Stock granted to a Non-Employee Director pursuant to Section 4 and which is not intended
to qualify as an incentive stock option under Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). Unless otherwise indicated, the term Option includes a “30-Day Option”. 
  

	3.	Number of Shares Available. 

  
 There are hereby reserved for issuance under this Plan an aggregate of 600,000 shares of Stock, which shares may be authorized but unissued shares,
treasury shares, or shares purchased on the open market or privately. To the extent any shares of Stock covered by an Option are not delivered to a grantee because the Option is forfeited or canceled, such shares shall not be deemed to have been
delivered for purposes of determining the maximum number of shares of Stock available for delivery under this Plan. If the Option Price (as defined in Section 5) of any Option granted under this Plan is satisfied by tendering shares of Stock to the
Company (by actual delivery), only the number of shares of Stock issued net of the shares of Stock tendered shall be deemed delivered for purposes of determining the maximum number of shares of Stock available for delivery under this Plan.

  

	4.	Initial and Annual Grant of Options. 

  
 (a) On the next business day (the “Initial Award Date”) after the later to occur of (i) the date an individual is appointed or elected as a
Non-Employee Director of the Company for the first time, or (ii) the date this Plan is adopted by the Board of Directors for those Non-Employee Directors appointed or elected prior to the date of the approval of this Plan, such Non-Employee
Director: 
  

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 (A) shall automatically receive the following: 
  

	 	1.	an Option to purchase a number of shares of Stock (rounded to the nearest whole share) equal to the lesser of (i) $20,000 divided by the per share fair market value of such Stock on
the Initial Award Date or (ii) 30,000 shares; notwithstanding the foregoing, those Non-Employee Directors, appointed or elected prior to the date of the approval of this Plan by the shareholders, shall receive an Option to purchase 30,000 shares of
Stock, and 

  

	 	2.	a 30-Day Option to purchase a number of shares of Stock equal to the number of shares determined under the foregoing clause (A)(1); and 

  
 (B) may, at the discretion of the Board of Directors,
receive the following (such new Non-Employee Director shall not participate in the approval by the Board of Directors of any such discretionary award): 
  

	 	1.	an Option to purchase up to 50,000 shares of Stock, and 

  

	 	2.	a 30-Day Option to purchase a number of shares of Stock equal to the number of shares granted by the Board of Directors under the Option described in the foregoing clause (B)(1), if
any. 

  
 In the case of a
Non-Employee Director who is appointed or elected as the Chairman of the Board for the first time, in addition to Options granted above, if any, such Chairman of the Board shall automatically receive a one-time grant of the following: 
  

	 	1.	an Option to purchase a number of shares of Stock (rounded to the nearest whole share) equal to the lesser of (i) $50,000 divided by the per share fair market value of such Stock on
the Initial Award Date or (ii) 70,000 shares; notwithstanding the foregoing, that Non-Employee Director appointed or elected as the Chairman of the Board prior to the date of the approval of this Plan by the shareholders, shall receive an Option to
purchase 70,000 shares of Stock, and 

  

	 	2.	a 30-Day Option to purchase a number of shares of Stock equal to the number of shares determined under the foregoing clause (1) of this sentence. 

  
 (b) On the first business day (an “Award Date”) following a
Non-Employee Director’s anniversary of election to the Board of Directors, such Non-Employee Director shall automatically receive an Option to purchase a number of shares of Stock (rounded to the nearest whole share) equal to the lesser of (i)
$20,000 divided by the per share fair market value of such Stock on the Award Date or (ii) 30,000 shares. 
  
 (c) Notwithstanding the foregoing, if, on an Initial Award Date or an Award Date, the Chief Executive Officer or Chief Financial Officer, in consultation
with the legal counsel of the Company, determines, in his/her sole discretion, that the Company is in possession of material, undisclosed information about the Company, then that grant of Options to Non-Employee Directors shall be suspended until
the second day after public dissemination of such information, and the price, exercisability dates and option period shall then be determined by reference to such later date. If Stock is not traded on the Over-the-Counter Bulletin Board
(“OTCBB”) or on any other securities exchange or stock market on any date a grant would otherwise be awarded, then the grant shall be made the next day thereafter on which Stock is so traded. All Option 
  

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 grants pursuant to this Plan shall be evidenced by a written instrument consistent with the provisions hereof.

  
 (d) Notwithstanding any provision contained herein to the
contrary, any grant made pursuant to this Section 4 shall be conditioned on the availability of sufficient shares reserved for issuance under the terms of this Plan at the date of grant of such Option and the approval of this Plan by a majority of
the Company’s shareholders. In the event that insufficient shares are then available, the number of shares under Options to be granted shall be reduced to the extent shares are then so available, on the basis of the seniority of the
Non-Employee Directors then eligible for grants hereunder (with the Non-Employee Directors having less time of service on the Board being first subject to reduction of the number of shares to be granted under their particular Option), or on such
other basis as deemed advisable or appropriate under the circumstances as determined by the Board. 
  

	5.	Option Price. 

  
 The price of the Option shall be the fair market value of the Company’s Stock on the Initial Award Date or Award Date, as the case may be (the
“Option Price”). Fair market value of the Stock as of any date means (a) the closing price of the Stock on that date on the principal securities exchange on which the Stock is listed; or (b) if the Stock is not listed on a securities
exchange, the average of the high and low sale prices of the Stock on that date as reported on the NASDAQ National Market System; or (c) if the Stock is not listed on the NASDAQ National Market System, the average of the high and low bid quotations
for the Stock on that date as reported by the OTCBB; or (d) if none of the foregoing is applicable, an amount at the election of the Board equal to (x) the average between the closing bid and ask prices per share of stock on the last preceding date
on which those prices were reported or (y) that amount as determined by the Board. 
  

	6.	Option Period. 

  
 Subject to the limitations set forth in this Plan, an Option granted under this Plan shall vest and become exercisable as follows: 
  
 (a) Generally. Except as provided in Section 6(b),
each Option shall vest and become exercisable in 33.33% installments on the first, second and third anniversary dates of the respective Initial Award Date or Award Date. 
  
 (b) 30-Day Options. A 30-Day Option shall vest and become exercisable on the Option’s respective
Initial Award Date or Award Date. No 30-Day Option may be exercised later than 30 days after the Initial Award Date or Award Date of such 30-Day Option. Notwithstanding the preceding sentence, a 30-Day Option granted prior to the effective date of
this Plan and which meets the requirements of Section 12 must be exercised during the period commencing on the date of the shareholder approval of this Plan and ending at the close of business on the date that is 30 days next following such
shareholder approval. 
  
 Subject to the limitations set forth in
this Plan, an Option may be exercised at any time after it vests and becomes exercisable, provided that at the time of exercise all of the conditions 
  

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 set forth in this Plan have been met. Notwithstanding the foregoing, no Option granted under this Plan may be exercised
later than five years after the date of grant thereof. 
  

	7.	Payment. 

  
 Options shall be exercised by the delivery of written notice to the Company setting forth the number of shares of Stock with respect to which the Option
is to be exercised, together with cash, wire transfer, certified check, bank draft or postal or express money order payable to the order of the Company (the “Acceptable Funds”) for an amount equal to the aggregate Option Price of such
shares of Stock, or at the election of the Non-Employee Director, by exchanging shares of Stock that has been owned by the Non-Employee Director for at least six months, so long as the total fair market value (determined in accordance with Section
5, as of the date of exercise) of the exchanged shares of Stock plus the Acceptable Funds paid, if any, equals the total Option Price of the shares to be acquired upon exercise of that Option, and specifying the address to which the certificates for
such shares are to be mailed. Additionally, if permitted by the Board, shares covered by an Option may be purchased upon exercise, in whole or in part, in accordance with the applicable Option agreement, by authorizing a third party to sell the
shares (or a sufficient portion thereof) acquired upon exercise of an Option, and assigning the delivery to the Company of a sufficient amount of the sale proceeds to pay for all the shares acquired through such exercise. Whenever an Option is
exercised by exchanging shares of Stock theretofore owned by the Non-Employee Director: (1) no shares of Stock received upon exercise of that Option thereafter may be exchanged to pay the Option Price for additional shares of Stock within the
following six months; (2) the aggregate fair market value of the shares of Stock tendered must be equal to or less than the aggregate Option Price of the shares being purchased upon exercise of the Option, and any difference must be paid in
Acceptable Funds; and (3) the Optionee shall deliver to the Company certificates registered in the name of such Non-Employee Director representing a number of shares of Stock legally and beneficially owned by such Non-Employee Director, free of all
liens, claims, and encumbrances of every kind, accompanied by stock powers duly endorsed in blank by the record holder of the share represented by such certificates, with signature guaranteed by a commercial bank or trust company or by a brokerage
firm having a membership on a registered national stock exchange. Such notice may be delivered in person to the Secretary of the Company, or may be sent by mail to the Secretary of the Company, in which case delivery shall be deemed made on the date
such notice is received. As promptly as practicable after receipt of such written notification and payment, the Company shall deliver to the Non-Employee Director certificates for the number of shares with respect to which such Option has been so
exercised, issued in the Non-Employee Director’s name; provided, that such delivery to the Non-Employee Director shall be deemed effected for all purposes when a stock transfer agent of the Company shall have deposited such certificates in the
United States mail, addressed to the Non-Employee Director, at the address specified by the Non-Employee Director. The delivery of certificates upon the exercise of Options is subject to the condition that the person exercising such Option provide
the Company with such information as the Company may reasonably request to such exercise, sale or other disposition. No shares may be issued until full payment of the aggregate Option Price therefor has been made. 
  

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	8.	Cessation of Service. 

  
 If, before the date of expiration of the Option, the Non-Employee Director shall cease to be a director of the Company, the Option shall terminate on the
earlier of the date of expiration or the date the Non-Employee Director ceases to be a director. 
  
 In the event of death while serving as a director, all unvested installments of Options outstanding shall thereupon automatically be accelerated and
become fully vested and exercisable in full, and the Option may be exercised for a period of three years after the Non-Employee Director’s death or, if earlier, the date of expiration of the Option, by the Non-Employee Director’s estate or
personal representative, or by the person who acquired the right to exercise the Option by bequest or inheritance or by reason of the Non-Employee Director’s death. 
  

	9.	Administration and Amendment of this Plan. 

  
 The Board of Directors of the Company may amend, alter, or discontinue this Plan at any time, but, except as otherwise provided herein, no amendment,
alteration, or discontinuation shall be made that would impair the rights of a grantee under an Option theretofore granted, without the grantee’s consent, or which, without the approval of the Company’s shareholders, would: 
  
 (i) increase the number of shares that may be issued under
this Plan (except by certain adjustments provided for under this Plan); 
  
 (ii) change the class of persons eligible to receive Options under this Plan; 
  
 (iii) change the requirements of Section 5 hereof regarding the Option Price; or 
  
 (iv) amend this Plan in a manner that would require approval
of the Company’s shareholders under applicable law, regulation or rule. 
  
 Notwithstanding any of the foregoing, adjustments pursuant to Section 14 shall not be subject to the foregoing limitations of this Section 9. 
  
 Options may not be granted under this Plan after the date of termination of this Plan, but Options granted prior to that
date shall continue to be exercisable according to their terms. 
  
 Subject to the above provisions, the Board of Directors of the Company shall have broad authority to amend this Plan to take into account changes in applicable securities and tax laws and accounting rules, as well as other developments.

  
 Except as permitted under Section 14, the Board of Directors
may not, without first obtaining shareholder approval, “reprice” outstanding Options as such term is used by the Securities and Exchange Commission (“SEC”) or NASDAQ or otherwise lower the exercise price of an Option. 

 

	10.	Transferability. 

  
 Except as otherwise provided in this Section 10, the Options granted under this Plan are not transferable other than as designated by the grantee by will
or by the laws of descent and 
  

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 distribution, and during the grantee’s life, may be exercised only by the grantee. However, the grantee may transfer
the Option for no consideration to or for the benefit of the grantee’s Immediate Family (including, without limitation, to a trust for the exclusive benefit of one or more members of the grantee’s Immediate Family or to a partnership or
limited liability company in which on one or more members of the grantee’s Immediate Family are the only partners or members, to an IRA for the exclusive benefit of one or more members of the grantee’s Immediate Family, an entity exempt
from federal income tax pursuant to Section 501(c)(3) of the Code or any successor provision and/or a split interest trust or pooled income fund described in Section 2522(c)(2) of the Code or any successor provision), subject to such limits as the
Board may establish, and the transferee shall remain subject to all the terms and conditions applicable to such Option prior to such transfer, provided, however, that subsequent transfers of such Option shall be prohibited except for
transfers by will or the laws of descent and distribution. The foregoing right to transfer the Option shall apply to the right to consent to amendments to the grant agreement and shall also apply to the right to transfer ancillary rights associated
with the Option. The provisions of this Plan concerning events of termination of service shall continue to be applied with respect to the original grantee, following which event(s) any such affected Options shall be exercisable by the transferee
only to the extent and for the periods specified therein or in the Option agreement. The Board and the Company shall have no obligation to inform any transferee of an Option of any expiration, termination, lapse or acceleration of such Option. The
term “Immediate Family” shall mean the grantee’s spouse, ex-spouse, parents, children, stepchildren, adoptive relationships, sisters, brothers and grandchildren (and, for this purpose, shall also include the grantee). The designation
by a grantee of a beneficiary will not constitute a transfer of the Option. 
  
 In the discretion of the Board of Directors of the Company, any attempt to transfer an Option other than under the terms of this Plan and the applicable Option agreement may terminate the Option. 
  

	11.	Miscellaneous. 

  
 Except as provided in this Plan, no Non-Employee Director shall have any claim or right to be granted an Option under this Plan. Neither this Plan nor any
actions hereunder shall be construed as giving any Director any right to be retained in the service of the Company or to continue to be nominated for election as a Director of the Company. 
  

	12.	Effective Date and Term of Plan. 

  
 This Plan shall be effective as of October 26, 2004, the date of its approval by the Board of Directors of the Company, only if shareholder approval of
this Plan is obtained at the 2004 Annual Meeting of Shareholders (the “2004 Meeting”). If shareholder approval is not obtained at the 2004 Meeting, no grants of Options shall be effective under this Plan. Any grants made under this Plan
prior to shareholder approval of this Plan shall be effective as of the date of such grant but only if the Option agreement related to such grant expressly provides that the Option is conditioned upon or subject to shareholder approval of this Plan.
This Plan shall remain in effect through October 26, 2009, or until earlier amended, altered or discontinued in accordance with the terms hereof. 
  

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	13.	No Rights As Shareholders. 

  
 No Non-Employee Director shall have rights as a shareholder with respect to shares covered by an Option until the date of issuance of a stock certificate
for such shares; and, except as otherwise provided in Section 14 hereof, no adjustment for dividends, or otherwise, shall be made if the record date thereof is prior to the date of issuance of such certificate. 
  

	14.	Changes In The Company’s Capital Structure. 

  
 The existence of outstanding Options shall not affect in any way the right or power of the Company or its shareholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of
or affecting the Stock or its rights, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

  
 If the Company shall effect a subdivision or consolidation of
shares or other capital readjustment, the payment of a stock dividend, or other increase or reduction of the number of shares of the Stock outstanding, without receiving compensation for it in money, services or property, then (a) the number, class,
and per share price of shares of Stock subject to outstanding Options under this Plan shall be appropriately adjusted in such a manner as to entitle a grantee to receive upon exercise of an Option, for the same aggregate cash consideration, the
equivalent total number and class of shares he would have received had he exercised his Option in full immediately prior to the event requiring the adjustment; and (b) the number and class of shares of Stock then reserved to be issued under this
Plan shall be adjusted by substituting for the total number and class of shares of Stock then reserved, that number and class of shares of Stock that would have been received by the owner of an equal number of outstanding shares of each class of
Stock as the result of the event requiring the adjustment. 
  
 If
the Company is merged or consolidated with another corporation, and the Company is not the surviving corporation, or if the Company is liquidated or sells or otherwise disposes of substantially all of its assets while unexercised Options remain
outstanding under this Plan, (a) subject to the provisions of clause (c) below, after the effective date of the merger, consolidations, liquidation, sale or other disposition, as the case may be, each holder of an outstanding Option shall be
entitled, upon exercise of the Option, to receive, in lieu of shares of Stock, the number and class or classes of shares of stock or other securities or property to which the holder would have been entitled if, immediately prior to the merger,
consolidation, liquidation, sale or other disposition, the holder had been the holder of record of a number of shares of Stock equal to the number of shares as to which the Option shall be so exercised; (b) the Board of Directors may waive any
limitations set out in or imposed under this Plan so that all Options, from and after a date prior to the effective date of the merger, consolidation, liquidation, sale or other disposition, as the case may be, specified by the Board of Directors,
shall be exercisable in full, to the extent permitted by applicable law; and (c) all outstanding Options may be canceled by the Board of Directors as of the effective date of any merger, consolidation, liquidation, sale or other disposition, if (i)
notice of cancellation shall be given to each holder of an Option and (ii) each holder of an Option shall have the right to exercise that Option in full (without regard to any limitations set out in or imposed under this Plan or the written
agreement granting that Option) during a period set by the Board of Directors preceding the effective date 
  

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 of the merger, consolidation, liquidation, sale or other disposition and, if in the event all outstanding Options may not
be exercised in full under applicable securities laws without registration of the shares of Stock issuable on exercise of the Options, the Board of Directors may limit the exercise of the Options to the number of shares of Stock, if any, as may be
issued without registration. The method of choosing which Options may be exercised, and the number of shares of Stock for which Options may be exercised, shall be solely within the discretion of the Board of Directors. 
  
 The issue by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe for them, or upon conversion of shares or obligations of the Company
convertible into shares or other securities, shall not affect, and no adjustment by reason of such issuance shall be made with respect to, the number, class, or price of shares of Stock then subject to outstanding Options. 
  

	15.	Change in Control of the Company. 

  
 In the event of a Change in Control of the Company, then, notwithstanding any other provision in the Plan to the contrary, all unvested installments of
Options outstanding shall thereupon automatically be accelerated and exercisable in full. For purposes of this Agreement, a “Change in Control of the Company” shall mean the occurrence of any of the following after the effective date of
this Plan: 
  
 (a) The acquisition by any
individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Covered Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of
either (i) the then outstanding shares of the common stock of the Company (the “Outstanding Company Common Stock”), or (ii) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in
the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (a) of this Section 15, the following acquisitions shall not constitute a Change in Control of
the Company: (i) any acquisition directly from the Company, (ii) any acquisition by the Company, (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company, or
(iv) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of subsection (c) of this Section 15; or 
  
 (b) Individuals who, as of the effective date of this Plan, constitute the Board of Directors (the “Incumbent Board”) cease for
any reason to constitute at least a majority of the Board of Directors; provided, however, that any individual becoming a director subsequent to the effective date of this Plan whose election, or nomination for election by the
Company’s shareholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any
such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other 
  

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 actual or threatened solicitation of proxies or consents by or on behalf of a Covered Person other than
the Board; or 
  
 (c) Consummation of (xx) a
reorganization, merger or consolidation or sale of the Company or any subsidiary of the Company, or (yy) a disposition of all or substantially all of the assets of the Company (a “Business Combination”), in each case, unless, following
such Business Combination, (i) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, direct or indirectly, more than 50% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the
election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (ii) no Covered Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 30% or more of,
respectively, the then outstanding shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation, except to the extent that such
ownership existed prior to the Business Combination, and (iii) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution
of the initial agreement, or of the action of the Board of Directors, providing for such Business Combination. 
  

	16.	Compliance With SEC Regulations. 

  
 It is the Company’s intent that this Plan comply in all respects with Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and any successor rule pursuant thereto. If any provision of this Plan is later found not to be in compliance with the Rule, the provision shall be deemed null and void or shall be reformed by the Board of Directors in
such manner so as to comply. All grants of Options and issuance of Stock and all exercises of Options under this Plan shall be executed in accordance with the requirements of Section 16 of the Exchange Act and any regulations promulgated thereunder,
so as to avoid the consequences of noncompliance to the Non-Employee Directors. 
  

	17.	Options In Substitution for Options Granted By Other Corporations. 

  
 Options may be granted under this Plan from time to time in substitution for such stock options held by directors of a
corporation who become or are about to become directors of the Company as the result of a merger or consolidation of the corporation with the Company or a subsidiary or the acquisition by either of the foregoing of stock of the corporation as the
result of which it becomes a subsidiary. 
  

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	18.	Investment Intent. 

  
 The Company may require that there be presented to and filed with it by any grantee(s) under this Plan, such evidence as it may deem necessary to
establish that the Options granted or the shares of Stock to be purchased or transferred are being acquired for investment and not with a view to their distribution. 
  

	19.	Indemnification of Board. 

  
 No current or previous member of the Board of Directors (or committee thereof), nor any officer or employee of the Company acting on behalf of the Board
of Directors (or committee thereof), shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to this Plan, and all such members of the Board of Directors (or committee thereof) and each
and any officer or employee of the Company acting on its behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action, determination or interpretation. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to which such individuals may be entitled under the Company’s Articles of Incorporation or Bylaws, as a matter of law, or otherwise. 
  

	20.	Governing Law. 

  
 This Plan and all determinations made and actions taken pursuant hereto shall be governed by the laws of the State of Texas, without reference to
principles of conflict of laws, and shall be construed accordingly. 
  

 10WellChoice, Inc. 2003 Omnibus Incentive Plan

 Exhibit 10.37 
  
 WELLCHOICE, INC. 
 2003 OMNIBUS INCENTIVE PLAN 
 EFFECTIVE AS OF NOVEMBER 7, 2003, 
 AMENDED AND RESTATED SEPTEMBER 22, 2004 
  

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 WELLCHOICE, INC. 
  
 2003 OMNIBUS INCENTIVE PLAN 
  

1. Purpose. WellChoice, Inc. 2003 Omnibus Incentive Plan (the “Plan”) is intended to provide incentives which will attract,
retain, motivate and reward highly competent persons who are officers, key employees and non-employee directors of WellChoice, Inc. (the “Company”) and its subsidiaries and affiliates, by providing them with appropriate incentives
and rewards to encourage them to enter into and continue in the employ or service of the Company, to acquire a proprietary interest in the long-term success of the Company. 
  
 2. Administration. 
  
 (a) Committee. The Plan will be administered by the compensation committee of the Board of Directors of the Company (the “Board”)
or such other committee appointed by the Board from among its members (the “Committee”) and shall be comprised, unless otherwise determined by the Board, solely of not less than two (2) members who shall be (i) “Non-Employee
Directors” within the meaning of Rule 16b-3(b)(3) (or any successor rule) promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and (ii) “outside directors” within the
meaning of Treasury Regulation Section 1.162-27(e)(3) under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). 
  
 (b) Authority. The Committee is authorized, subject to the provisions of the Plan, to establish such rules and regulations as it deems necessary
for the proper administration of the Plan and to make such determinations and interpretations and to take such action in connection with the Plan and any Benefits granted hereunder as it deems necessary or advisable. All determinations and
interpretations made by the Committee shall be binding and conclusive on all participants and their legal representatives. 
  
 (c) Indemnification. No member of the Committee and no employee of the Company shall be liable for any act or failure to act hereunder, except in
circumstances involving his or her bad faith or willful misconduct, or for any act or failure to act hereunder by any other member or employee or by any agent to whom duties in connection with the administration of this Plan have been delegated. The
Company shall indemnify members of the Committee and any agent of the Committee who is an employee of the Company, a subsidiary or an affiliate against any and all liabilities or expenses to which they may be subjected by reason of any act or
failure to act with respect to their duties on behalf of the Plan, except in circumstances involving such person’s bad faith or willful misconduct. 
  
 (d) Delegation and Advisers. The Committee may delegate to one or more of its members or officers of the Company any duties, power or authority it
has under the Plan pursuant to such conditions as the Committee may establish, except that the Committee shall not delegate its powers and duties under the Plan (1) with regard to Benefits issued to officers of the Company who are subject to Section
16 of the Exchange Act, or (2) in such a manner as would cause grants intended to qualify as Performance-Based Awards to fail to so qualify. In addition, the Committee may delegate to one or more of its members, or to one or more agents, such
administrative duties as it may deem advisable, 
  

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 and the Committee, or any person to whom it has delegated duties as aforesaid, may employ one or more persons to render
advice with respect to any responsibility the Committee or such person may have under the Plan. The Committee may employ such legal or other counsel, consultants and agents as it may deem desirable for the administration of the Plan and may rely
upon any opinion or computation received from any such counsel, consultant or agent. Expenses incurred by the Committee in the engagement of such counsel, consultant or agent shall be paid by the Company, or the subsidiary or affiliate whose
employees have benefited from the Plan, as determined by the Committee. 
  
 3. Participants. Participants will consist of such officers, key employees and Non-Employee Directors of the Company and its subsidiaries and affiliates as the Committee in its sole discretion determines to be significantly
responsible for the success and future growth and profitability of the Company and whom the Committee may designate from time to time to receive Benefits under the Plan. Designation of a participant in any year shall not require the Committee to
designate such person to receive a Benefit in any other year or, once designated, to receive the same type or amount of Benefit as granted to the participant in any other year. The Committee shall consider such factors as it deems pertinent in
selecting participants and in determining the type and amount of their respective Benefits. Non-Employee Directors of the Company and its subsidiaries shall not be eligible for Cash Awards (as described below). 
  
 4. Type of Benefits. Benefits under the Plan may be granted in any one
or a combination of (a) Stock Options, (b) Stock Appreciation Rights, (c) Restricted Stock Awards, (d) Restricted Stock Units, and (e) Cash Awards (each as described below, and collectively, the “Benefits”). Restricted Stock Awards,
Restricted Stock Units and Cash Awards may, as determined by the Committee in its discretion, constitute Performance-Based Awards, as described in Section 11 hereof. Benefits granted under the Plan shall be evidenced by agreements (which need not be
identical) that may provide additional terms and conditions associated with such Benefits, as determined by the Committee in its sole discretion, provided, however, that in the event of any conflict between the provisions of the Plan and any
such agreement, the provisions of the Plan shall prevail. 
  
 5.
Common Stock Available Under the Plan. 
  
 (a)
Limitations. 
  
 (i) Plan Limitations. 

 
 (A) Total Number of Shares. The aggregate number of shares of
common stock of the Company, par value $0.01 (“Common Stock”) that may be subject to Benefits and issued under this Plan shall be 6,250,000 shares of Common Stock, subject to any adjustments made in accordance with Sections 5(b) and
(c), and 13 hereof. Shares of Common Stock may be authorized and unissued shares, treasury shares or shares previously authorized and issued and purchased by the Company for purposes of satisfying Awards under the Plan. 
  
 (B) Restricted Stock Awards and Restricted Stock Units. The maximum
number of shares of Common Stock that may be granted or measured under the Plan as Restricted Stock Awards or Restricted Stock Units and that vest or otherwise become non-forfeitable by a participant during the term of the Plan shall be 1,875,000
shares, subject to any adjustments made in accordance with Section 13 hereof and, with respect to shares previously subject to any Restricted Stock Award or Restricted Stock Units, Sections 5(b) and (c) hereof. 
  

 3 

 (C) Non-Employee Director Awards. The maximum number of shares of Common Stock that may be granted
or measured under Awards to Non-Employee Directors during the term of the Plan shall be 500,000, subject to any adjustments made in accordance with Section 13 hereof and, with respect to shares of Common Stock previously subject to any Award,
Sections 5(b) and (c) hereof. 
  
 (ii) Individual
Limitations. Notwithstanding any other provision in this Plan, the following limitations shall apply to the Awards described below, subject to adjustment pursuant to Section 13 hereof: 
  
 (A) Stock Options and Stock Appreciation Rights. The maximum number
of shares of Common Stock with respect to which Stock Options (whether or not Incentive Stock Options) or Stock Appreciation Rights may be granted or measured to any individual participant under the Plan in any calendar year during the term of the
Plan shall be 300,000 shares, subject to adjustment pursuant to Section 13 hereof. 
  
 (B) Restricted Stock Awards or Restricted Stock Units. The maximum number of shares of Common Stock that may be granted or measured to any individual participant under the Plan as Restricted Stock Awards or
Restricted Stock Units during any calendar year during the term of the Plan shall be 100,000 shares, subject to adjustment pursuant to Section 13 hereof. 
  
 (C) Performance Award Limitation for Long-Term Incentive Awards. Subject to Section 5(a)(ii)(A) and 5(a)(ii)(B) above, the maximum amount of any
Performance-Based Award containing a performance period in excess of one year, payable or distributable to any participant who is a “covered employee” within the meaning of Section 162(m) whether in cash, shares or other property
shall be the lesser of (i) $3 million multiplied by the number of years in the performance period governing such Award, and (ii) $10 million. 
  
 (D) Performance Award Limitation for Annual Incentive Awards. Subject to Section 5(a)(ii)(A) and 5(a)(ii)(B) above, the maximum amount of any
Performance-Based Award, containing a performance period of one year, payable or distributable to any Covered Employee whether in cash, shares or other property shall be $5 million. 
  
 (E) Non-Employee Director Benefits. The maximum number of shares of Common Stock that may be granted or measured
under Awards to any individual Non-Employee Director during the term of the Plan in any calendar year shall be 10,000, subject to adjustment pursuant to Section 13 hereof. 
  
 (F) Ownership Limitation. No participant may receive a Benefit under the Plan, if immediately after the receipt of
such Benefit, such participant would Beneficially Own more than five percent (5%) of the issued and outstanding Capital Stock of the Company. The terms “Beneficially Own” and “Capital Stock” have the meanings
ascribed to them in the Company’s certificate of incorporation. 
  
 (b) Additional Shares. The following shares of Common Stock subject to, relating to or arising out of Benefits under the Plan shall again be available for any type of Benefits under the Plan for purposes of the Plan limitations
contained in Section 5(a)(i) but not for any of the individual limitations contained in Section 5(a)(ii): 
  
 (i) Unexercised Stock Options and Stock Appreciation Rights. Any shares of Common Stock subject to a Stock Option or Stock Appreciation Right which
for any reason is cancelled or terminated without having been exercised; 
  

 4 

 (ii) Forfeited Restricted Stock Awards, Restricted Stock Units, and Performance-Based Awards. Any
shares subject to Restricted Stock Awards, Restricted Stock Units or Performance Awards that are forfeited; 
  
 (iii) Shares Delivered in Payment or to Satisfy a Tax Obligation. Any shares delivered to the Company as part or full payment of the exercise or
purchase price of a Stock Option, Stock Appreciation Right or Restricted Stock Award or to satisfy a tax obligation in connection with an Award, including any shares withheld by the Company pursuant to Section 17 hereof to satisfy any tax
withholding requirements; 
  
 (iv) Awards Settled in Cash.
Any Awards settled in cash; and 
  
 (v) Shares repurchased with
Option Exercise Proceeds. Any shares of Common Stock that are repurchased by the Company on the open market or in private transactions in which the Company is a party, may be added to the aggregate number of shares available for issuance for the
exercise of Options or issuance of other Benefits under this Plan provided (i) the aggregate price paid for the repurchased shares does not exceed the cumulative amount received in cash by the Company and (ii) the repurchased shares shall not be
added to the maximum number of shares issued with respect to Options under the Plan which shall not exceed 6,250,000, subject to other adjustments pursuant to Section 5(b)(i) through (iv), 5(c) and 13 hereof. 
  
 (c) Acquisitions. In connection with the acquisition of any business
by the Company or any of its subsidiaries or affiliates, any outstanding grants, awards or sales of options or other similar rights pertaining to such business may be assumed or replaced by Benefits under the Plan upon such terms and conditions as
the Committee determines. The date of any such grant or award shall relate back to the date of the initial grant or award being assumed or replaced, and service with the acquired business shall constitute service with the Company or its subsidiaries
or affiliates for purposes of such grant or award. Any shares of Common Stock underlying any grant or award or sale pursuant to any such acquisition shall be disregarded for purposes of applying the limitations under and shall not reduce the number
of shares of Common Stock available under Section 5(a)(i) above. 
  
 6. Stock Options. 
  
 (a) Generally. Stock
Options will consist of awards from the Company that will enable the holder to purchase a number of shares of Common Stock, at set terms. Stock Options may be “incentive stock options” (“Incentive Stock Options”),
within the meaning of Section 422 of the Code, or Stock Options which do not constitute Incentive Stock Options (“Nonqualified Stock Options”). The Committee will have the authority to grant to any participant one or more Incentive
Stock Options, Nonqualified Stock Options, or both types of Stock Options (in each case with or without Stock Appreciation Rights). Each Stock Option shall be subject to such terms and conditions, including vesting, consistent with the Plan as the
Committee may impose from time to time, subject to the following limitations: 
  
 (b) Exercise Price. Each Stock Option granted hereunder shall have per-share exercise price as the Committee may determine at the date of grant but in no event less than one hundred percent (100%) of the Fair
Market Value of Common Stock on the date of grant. 
  

 5 

 (c) Payment of Exercise Price. The option exercise price may be paid in cash or, in the discretion
of the Committee, one or more of the following that the Committee determines to be consistent with applicable law (including, when applicable, the Sarbanes-Oxley Act of 2002, as it may be amended from time to time) and the purpose of the Plan:

  
 (A) by the delivery of shares of Common Stock of the Company
then owned by the participant, provided any shares acquired upon exercise of a Stock Option or other Benefit have been held for at least six (6) months by the participant; 
  
 (B) by delivering a properly executed exercise notice to the Company together with a copy of irrevocable instructions to a
broker to deliver promptly to the Company the amount of sale or loan proceeds to pay the exercise price. To facilitate the foregoing, the Company may enter into agreements for coordinated procedures with one or more brokerage firms; and 

 
 (C) by permitting the cashless exercise of the Stock Option where the
number of shares to be delivered to the participant upon exercise of the Stock Option is reduced by a number of shares of Common Stock having a Fair Market Value equal to the exercise price and the amount necessary to satisfy any tax obligations in
connection with the exercise of the Stock Option. 
  
 (d)
Exercise Period. Subject to Section 6(f) hereof, Stock Options granted under the Plan shall be exercisable at such time or times and subject to such terms and conditions, including vesting, as shall be determined by the Committee;
provided, however, that no Stock Option shall be exercisable later than ten (10) years after the date it is granted except in the event of a participant’s death, in which case, the exercise period of such participant’s Stock Options
may be extended beyond such period but no later than one (1) year after the participant’s death. All Stock Options shall terminate at such earlier times and upon such conditions or circumstances as the Committee shall in its discretion set
forth in such option agreement at the date of grant. 
  
 (e)
Limitations on Incentive Stock Options. Incentive Stock Options may be granted only to participants who are employees of the Company or of a “Parent Corporation” or “Subsidiary Corporation” (as defined in
Sections 424(e) and (f) of the Code, respectively) at the date of grant. The aggregate Fair Market Value (determined as of the time the Stock Option is granted) of the Common Stock with respect to which Incentive Stock Options are exercisable for
the first time by a participant during any calendar year (under all option plans of the Company and of any Parent Corporation or Subsidiary Corporation) shall not exceed one hundred thousand dollars ($100,000). For purposes of the preceding
sentence, Incentive Stock Options will be taken into account in the order in which they are granted. The per-share exercise price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of the Common
Stock on the date of grant, and no Incentive Stock Option may be exercised later than ten (10) years after the date it is granted. 
  

 6 

 (f) Minimum Vesting Period. If the vesting of a Stock Option is not linked to any of the business
criteria described in Section 11(b), then no portion of such Stock Option shall vest earlier than one (1) year following the date of grant except that the Committee may provide for the acceleration of vesting upon or immediately prior to the
occurrence of a Change in Control or upon termination of employment or service as a Non-Employee Director due to death or disability within such one-year period. 
  
 7. Stock Appreciation Rights. 
  
 (a) Generally. The Committee may, in its discretion, grant Stock Appreciation Rights, including a concurrent grant of
Stock Appreciation Rights in tandem with any Stock Option grant. A Stock Appreciation Right means a right to receive a payment in cash, Common Stock or a combination thereof, for an amount equal to the excess of (i) the Fair Market Value, or other
specified valuation, of a specified number of shares of Common Stock on the date the right is exercised over (ii) the Fair Market Value, of such shares of Common Stock on the date the right is granted, or other specified amount, all as determined by
the Committee; provided, however, that if a Stock Appreciation Right is granted in tandem with or in substitution for a Stock Option, the designated Fair Market Value in the award agreement shall reflect the Fair Market Value on the date such
Stock Option was granted. Each Stock Appreciation Right shall be subject to such terms and conditions, including vesting, as the Committee shall impose from time to time. 
  
 (b) Exercise Period. Stock Appreciation Rights granted under the Plan shall be exercisable, at such time or times and
subject to such terms and conditions, including vesting, as shall be determined by the Committee; provided, however, that no Stock Appreciation Rights shall be exercisable later than ten (10) years after the date it is granted except in the
event of a participant’s death, in which case, the exercise period of such participant’s Stock Appreciation Rights may be extended beyond such period but no later than one (1) year after the participant’s death. All Stock Appreciation
Rights shall terminate at such earlier times and upon such conditions or circumstances as the Committee shall in its discretion set forth in such right at the date of grant. 
  
 (c) Minimum Vesting Period. If the vesting of a Stock Appreciation Right is not linked to any of the business
criteria described in Section 11(b), then no portion of such Stock Appreciation Right shall vest earlier than one (1) year following the date of grant, except that the Committee may provide for the acceleration of vesting upon or immediately prior
to the occurrence of a Change in Control or upon termination of employment or service as a Non-Employee Director due to death or disability within such one-year period. 
  
 8. Restricted Stock Awards. 
  

(a) Generally. The Committee may, in its discretion, grant Restricted Stock Awards (which may include mandatory payment of any bonus in stock)
consisting of Common Stock issued or transferred to participants with or without other payments therefor. A Restricted Stock Award shall be construed as an offer by the Company to the participant to purchase the number of shares of Common Stock
subject to the Restricted Stock Award at the purchase price, if any, established therefor. Any right to acquire the shares under the Restricted Stock Award that is not accepted by the participant within thirty (30) days after the grant is
communicated shall automatically expire. 
  

 7 

 (b) Payment of the Purchase Price. If the Restricted Stock Award requires payment therefor, the
purchase price of any shares of Common Stock subject to a Restricted Stock Award may be paid in any manner authorized by the Committee, which may include any manner authorized under the Plan for the payment of the exercise price of a Stock Option.
Restricted Stock Awards may also be made in consideration of services rendered to the Company or its subsidiaries or affiliates. 
  
 (c) Additional Terms. Restricted Stock Awards shall be subject to such terms and conditions as the Committee deems appropriate including, without
limitation, (i) vesting, (ii) restrictions on the transfer of such shares, (iii) the right of the Company to reacquire such shares for no consideration, and (iv) a waiver by the participant of the right to vote or to receive any dividend or other
right or property with respect thereto), and may also constitute Performance-Based Awards, as described in Section 11 hereof; provided, however, that if the vesting of a Restricted Stock Award is not linked to any of the business criteria
described in Section 11(b) or not issued in payment of other compensation that has been earned by the participant, then no portion of such Restricted Stock Award shall vest earlier than one (1) year following the date of grant except the Committee
may provide for the acceleration of such vesting upon or immediately prior to the occurrence of a Change in Control or upon termination of employment or service as a Non-Employee Director due to death or disability within such one-year period. The
Committee may require the participant to deliver a duly signed stock power, endorsed in blank, relating to the Common Stock covered by such an Award. The Committee may also require that the stock certificates evidencing such shares be held in
custody or bear restrictive legends until the restrictions thereon shall have lapsed. 
  
 (d) Rights as a Shareholder. The Restricted Stock Award shall specify whether the participant shall have, with respect to the shares of Common Stock subject to a Restricted Stock Award, all of the rights of a
holder of shares of Common Stock of the Company, including the right to receive dividends and to vote the shares. 
  
 9. Restricted Stock Units. 
  
 (a) Generally. The Committee may, in its discretion, grant Restricted Stock Units (as defined in subsection (c) below) to participants hereunder.
Restricted Stock Units shall be subject to such terms and conditions as the Committee deems appropriate, including, without limitation, (i) vesting, (ii) restrictions on the transfer of such Units, (iii) forfeiture provisions, and (iv) a waiver by
the participant of the right to vote or to receive any dividend or other right or property with respect thereto), and may also constitute Performance-Based Awards, as described in Section 11 hereof; provided, however, that if the vesting of a
Restricted Stock Unit is not linked to any of the business criteria described in Section 11(b) or not issued in payment of other compensation that has been earned by the participant, then no portion of such Restricted Stock Unit shall vest earlier
than one (1) year following the date of grant except the Committee may provide for the acceleration of such vesting upon or immediately prior to the occurrence of a Change in Control or upon termination of employment or service as a Non-Employee
Director due to death or disability within such one-year period. The Committee shall determine whether a participant granted a Restricted Stock Unit shall be entitled to a Dividend Equivalent Right (as defined in subsection (c) below). 

 
 (b) Settlement of Restricted Stock Units. A Restricted Stock Unit
granted by the Committee shall provide payment in shares of Common Stock at such time as the award agreement shall specify unless the Committee provides for the payment of the Restricted Stock Units in cash equal to the value 
  

 8 

 of the shares of Common Stock which would otherwise be distributed to the participant or partly in cash and partly in
shares of Common Stock. Shares of Common Stock issued pursuant to this Section 9 may be issued with or without other payments therefor as may be required by applicable law or such other consideration as may be determined by the Committee.

  
 (c) Definitions. A “Restricted Stock
Unit” means a notional account representing one (1) share of Common Stock. A “Dividend Equivalent Right” means the right to receive the amount of any dividend paid on the share of Common Stock underlying a Restricted Stock
Unit, which shall be payable in cash or in the form of additional Restricted Stock Units. 
  
 10. Cash Awards. 
  
 The
Committee may, in its discretion, grant awards to be settled solely in cash (“Cash Awards”). Cash Awards may be subject to such terms and conditions, including vesting, as the Committee determines appropriate. Cash Awards may
constitute Performance-Based Awards, as described in Section 11 hereof. 
  
 11. Performance-Based Awards. 
  
 (a)
Generally. Any Benefits granted under the Plan may be granted in a manner such that the Benefits qualify for the performance-based compensation exemption of Section 162(m) of the Code (“Performance-Based Awards”). As
determined by the Committee in its sole discretion, either the granting or vesting of such Performance-Based Awards shall be based on achievement of hurdle rates and/or growth rates in one or more business criteria that apply to the individual
participant, one or more business units or the Company as a whole. 
  
 (b) Business Criteria. The business criteria shall be as follows, individually or in combination: (i) earnings; (ii) earnings per share; (iii) market share; (iv) operating profit; (v) operating margin; (vi) return on equity; (vii)
return on assets; (viii) total return to stockholders; (ix) revenues; (x) cash flows, (xi) membership; (xii) member satisfaction; (xiii) technology improvements; (xiv) claims handling; and (xv) return on investment capital. In addition,
Performance-Based Awards may include comparisons to the performance of other companies, such performance to be measured by one or more of the foregoing business criteria. 
  
 (c) Establishment of Performance Goals. With respect to Performance-Based Awards, the Committee shall establish in
writing (i) the performance goals applicable to a given period, and such performance goals shall state, in terms of an objective formula or standard, the method for computing the amount of compensation payable to the participant if such performance
goals are obtained and (ii) the individual employees or class of employees to which such performance goals apply no later than ninety (90) days after the commencement of such period (but in no event after twenty-five percent (25%) of such period has
elapsed). 
  
 (d) Certification of Performance. No
Performance-Based Awards shall be payable to or vest with respect to, as the case may be, any participant for a given period until the Committee certifies in writing that the objective performance goals (and any other material terms) applicable to
such period have been satisfied. 
  

 9 

 (e) Modification of Performance-Based Awards. With respect to any Benefits intended to qualify as
Performance-Based Awards, after establishment of a performance goal, the Committee shall not revise such performance goal or increase the amount of compensation payable thereunder (as determined in accordance with Section 162(m) of the Code) upon
the attainment of such performance goal. Notwithstanding the preceding sentence, the Committee may reduce or eliminate the number of shares of Common Stock or cash granted or the number of shares of Common Stock vested upon the attainment of such
performance goal. 
  
 (f) Settlement of Performance-Based
Awards. Performance-Based Awards may be settled in cash, shares of Common Stock or any combination thereof. Should the Committee so provide, settlement of Performance-Based Awards may be deferred and paid in installments or a lump sum in
accordance with such procedures as may be established by the Committee. Such deferred awards may be credited with a reasonable rate of interest. 
  
 (g) Annual Executive Incentive Plan. Annual bonuses under the Company’s Annual Executive Incentive Compensation Plan for the Company’s
senior executive officers and bonuses to other employees to be settled in (or measured by reference to) shares of Common Stock, shall be designed as Performance-Based Awards and settled under this Plan. Unless the Committee provides otherwise, award
opportunities under the Annual Executive Incentive Plan shall be set as a percentage of base salary, subject to the limitations contained in Section 5 hereof. 
  

(h) Long Term Incentive Plan. Awards made under the Company’s Long Term Incentive Plan to the Company’s senior executive officers and
awards to other employees to be settled (or measured by reference to) shares of Common Stock, shall be designed as Performance-Based Awards and settled under this Plan. 
  
 12. Non-Employee Director Awards. 
  
 (a) Avoidance of Conflicts. No member of the Committee shall exercise discretion with respect to his own Benefit
unless such discretion is applicable uniformly to the Benefits of similarly situated Non-Employee Director participants. 
  
 (b) Taxes. Upon or prior to the exercise of an Option or receipt of Common Stock, a Non-Employee Director may make a written election to have
shares of Common Stock withheld by the Company from the shares otherwise to be received to cover Federal, state or local income, and other taxes and governmental obligations (“Taxes”) incurred by the reason of the exercise or
issuance of Benefits under the Plan. The number of shares so withheld shall have an aggregate Fair Market Value on the date of exercise sufficient to satisfy the applicable Taxes. The acceptance of any such election by an Optionee shall be at the
sole discretion of the Committee. Such Taxes shall be calculated at minimum statutory withholding rates. 
  
 13. Adjustment Provisions; Change in Control. 
  
 (a) Adjustment Generally. If there shall be any change in the Common Stock of the Company, through merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, reverse stock split, split up, spin-off, combination of shares, exchange of shares, dividend in kind or other like change in capital structure or distribution (other than normal cash dividends) to
stockholders of the Company, an adjustment shall be made to each outstanding Stock Option and Stock 
  

 10 

 Appreciation Right such that each such Stock Option and Stock Appreciation Right shall thereafter be exercisable for such
securities, cash and/or other property as would have been received in respect of the Common Stock subject to such Stock Option or Stock Appreciation Right had such Stock Option or Stock Appreciation Right been exercised in full immediately prior to
such change or distribution, and such an adjustment shall be made successively each time any such change shall occur. 
  
 (b) Modification of Benefits. In the event of any change or distribution described in subsection (a) above, in order to prevent dilution or
enlargement of participants’ rights under the Plan, the Committee will have authority to adjust, in an equitable manner, the number and kind of shares that may be issued under the Plan, the number and kind of shares subject to outstanding
Benefits, the exercise price applicable to outstanding Benefits, and the Fair Market Value of the Common Stock and other value determinations applicable to outstanding Benefits; provided, however, that any such arithmetic adjustment to a
Performance-Based Award shall not cause the amount of compensation payable thereunder to be increased from what otherwise would have been due upon attainment of the unadjusted award. Appropriate adjustments may also be made by the Committee in the
terms of any Benefits under the Plan to reflect such changes or distributions and to modify any other terms of outstanding Benefits on an equitable basis, including modifications of performance targets and changes in the length of performance
periods; provided, however, that any such arithmetic adjustment to a Performance-Based Award shall not cause the amount of compensation payable thereunder to be increased from what otherwise would have been due upon attainment of the
unadjusted award. In addition, other than with respect to Stock Options, Stock Appreciation Rights, and other awards intended to constitute Performance-Based Awards, the Committee is authorized to make adjustments to the terms and conditions of, and
the criteria included in, Benefits in recognition of unusual or nonrecurring events affecting the Company or the financial statements of the Company, or in response to changes in applicable laws, regulations, or accounting principles.
Notwithstanding the foregoing, (i) each such adjustment with respect to an Incentive Stock Option shall comply with the rules of Section 424(a) of the Code, and (ii) in no event shall any adjustment be made which would render any Incentive Stock
Option granted hereunder other than an incentive stock option for purposes of Section 422 of the Code. 
  
 (c) Effect of a Change in Control. Notwithstanding any other provision of this Plan, unless the Committee shall determine otherwise at the time of
grant with respect to a particular Benefit, in the event of a Change in Control: 
  
 (i) All outstanding Benefits (other than those Benefits designed to qualify as Performance-Based Awards) shall become fully and immediately exercisable and vested and all deferrals and restrictions with respect
thereto shall lapse unless such Benefits are converted, assumed or replaced by a successor. In the event of a Change in Control in which such Benefits are not converted, assumed or replaced by a successor, all such Benefits shall be subject to the
terms of any agreement effecting the Change in Control, which agreement, may provide, without limitation, that each Stock Option and Stock Appreciation Right outstanding hereunder shall terminate within a specified number of days after notice to the
holder, and that such holder shall receive, with respect to each share of Common Stock subject to such Stock Option or Stock Appreciation Right, an amount equal to the excess of the Fair Market Value of such shares of Common Stock immediately prior
to the occurrence of such Change in Control over the exercise price per share underlying such Stock Option or Stock Appreciation Right with such amount payable in cash, in one or more kinds of property (including the 
  

 11 

 property, if any, payable in the transaction) or in a combination thereof, as the Committee, in its discretion, shall
determine. A provision like the one contained in the preceding sentence shall be inapplicable to a Stock Option or Stock Appreciation Right granted within six (6) months before the occurrence of a Change in Control if the holder of such Stock Option
or Stock Appreciation Right is subject to the reporting requirements of Section 16(a) of the Exchange Act and no exception from liability under Section 16(b) of the Exchange Act is otherwise available to such holder. 
  
 (ii) If following a Change in Control, the Benefits of a participant (other
than those Benefits designed to qualify as Performance-Based Awards) are converted, assumed or replaced by a successor and within twenty-four (24) months following such Change in Control the participant’s employment with the Company or the
successor is terminated by the Company (or the successor) without “Cause” or by the participant for “Good Reason” (as such terms are defined in Section 13(d) below), then as of the date that employment terminates
the unvested portion of such Benefits shall become fully exercisable and vested and all deferrals and restrictions on any such Benefits shall lapse. 
  
 (iii) Upon a Change in Control, all Performance-Based Awards (and cash or other awards the payment of which depends on achievement of performance factors
(a “performance-type award”) shall, if appropriate, be adjusted pursuant to Section 13(a) above. If within 24 months following a Change in Control, a participant’s employment with the Company or the successor is terminated by
the Company (or the successor) without Cause or by the participant for Good Reason, the Company (or the successor) shall pay the participant (A) any accrued but unpaid Performance-Based Award (and each other performance-type award) which had not
been paid for any performance periods that ended prior to date employment terminated, and (B) a pro-rata Performance-Based Award (and each other performance-type award) for each performance period that had not been completed as of the date of
employment termination, based on the target award established for each such performance period and any requirement that a participant remain employed to receive a Performance-Based Award shall be waived. 
  
 (d) Definitions. The following definitions used in this Section 13
shall have the meaning ascribed to them below: 
  
 (i)
“Cause” shall mean “cause” as defined in any individual employment, severance or Change in Control agreement between the Company and the participant or in the absence of any such agreement, “cause”
as defined in the Award agreement. 
  
 (ii) “Change in
Control” of the Company shall be deemed to have occurred upon any of the following events: 
  
 (A) Any person (as such term is used in Section 13(d) and 14(d) of the Exchange Act, other than the Fund referred to below, is or becomes the
“beneficial owner” (as determined for purposes of Regulation 13D-G under the Exchange Act as currently in effect), directly or indirectly, of securities of the Company representing twenty-five percent (25%) or more of the combined
voting power of the Company’s then outstanding securities; or 
  
 (B) During any period of two (2) consecutive years, individuals who at the beginning of such period constitute the Board and any new director, whose election to the Board or nomination for election to the Board was approved by a vote of at
least two-thirds (2/3) of the directors then still in 
  

 12 

 office who either were directors at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the Board; or (C) The Company effects a merger or consolidation with any other corporation, other than a merger or consolidation (1) which does not result in any person
becoming the beneficial owner, directly or indirectly of securities of the Company or the surviving entity fifty percent (50%) or more of the combined voting power of the Company’s (or such surviving entity’s) then outstanding securities,
and (2) in which a majority of the Board of Directors of the Company or such surviving entity immediately after such merger or consolidation is comprised of directors of the Company immediately prior to such merger or consolidation; or 

 
 (D) The Company sells or disposes of all or substantially all of the
Company’s assets. 
  
 Notwithstanding anything to the contrary set forth
herein, the ownership of The New York State Public Asset Fund of more than twenty-five percent (25%) of the Company’s securities does not constitute a Change in Control for purposes of this Plan. 
  
 (iii) “Good Reason” shall mean “good
reason” as defined in any individual employment, severance or Change in Control agreement between the Company and the participant or in the absence of any such agreement, “good reason” as defined in the Award agreement.

  
 14. Nontransferability. Each Benefit granted under the
Plan to a participant (other than that portion of a Restricted Stock Award or Cash Award which has vested) shall not be transferable otherwise than by will or the laws of descent and distribution, and shall be exercisable, during the
participant’s lifetime, only by the participant. In the event of the death of a participant, each Stock Option or Stock Appreciation Right theretofore granted to him or her shall be exercisable during such period after his or her death as the
Committee shall in its discretion set forth in such option or right at the date of grant and then only by the executor or administrator of the estate of the deceased participant or the person or persons to whom the deceased participant’s rights
under the Stock Option or Stock Appreciation Right shall pass by will or the laws of descent and distribution. Notwithstanding the foregoing, at the discretion of the Committee, an award of a Benefit other than an Incentive Stock Option may permit
the transferability of a Benefit by a participant solely to the participant’s spouse, siblings, parents, children, grandchildren and a same gender domestic partner who both shares the participant’s household and satisfies the eligibility
criteria as set forth in the Affidavit of Domestic Partnership provided by the Company, or trusts for the benefit of such persons or partnerships, corporations, limited liability companies or other entities owned solely by such persons, including
trusts for such persons, subject to any restriction included in the award of the Benefit. 
  
 15. Other Provisions. The award of any Benefit under the Plan may also be subject to such other provisions (whether or not applicable to the Benefit awarded to any other participant) as the Committee determines
appropriate, including, without limitation, for the forfeiture of, or restrictions on resale or other disposition of, Common Stock acquired under any form of Benefit, for the payment of the value of Benefits to participants in the event of a Change
in Control, or to comply with federal and state securities laws, or understandings or conditions as to the participant’s service with the Company in addition to those specifically provided for under the Plan. 
  
 16. Fair Market Value. For purposes of this Plan and any Benefits
awarded hereunder, Fair Market Value shall be the average of the high and low sale prices of the Company’s 
  

 13 

 Common Stock on the date of calculation (or on the last preceding trading date if Common Stock was not traded on such
date) if the Company’s Common Stock is readily tradable on a national securities exchange or other market system, and if the Company’s Common Stock is not readily tradable, Fair Market Value shall mean the amount determined in good faith
by the Committee as the fair market value of the Common Stock of the Company. 
  
 17. Withholding. All payments or distributions of Benefits made pursuant to the Plan shall be net of any amounts required to be withheld pursuant to applicable Taxes. If the Company proposes or is required to
distribute Common Stock pursuant to the Plan, it may require the recipient to remit to it or to the corporation that employs such recipient an amount sufficient to satisfy such tax withholding requirements prior to the delivery of any certificates
for such Common Stock. In lieu thereof, the Company or the employing corporation shall have the right to withhold the amount of Taxes from any other sums due or to become due from such corporation to the recipient as the Committee shall prescribe.
The Committee may, in its discretion and subject to such rules as it may adopt (including any as may be required to satisfy applicable tax and/or non-tax regulatory requirements), permit an optionee or award or right holder to pay all or a portion
of Taxes arising in connection with any Benefit consisting of shares of Common Stock by electing to have the Company withhold shares of Common Stock having a Fair Market Value equal to the amount of Taxes to be withheld. Such Taxes shall be
calculated at minimum statutory withholding rates. 
  
 18.
Tenure. A participant’s right, if any, to continue to serve the Company or any of its subsidiaries or affiliates as an officer, employee, Non-Employee Director or otherwise, shall not be enlarged or otherwise affected by his or her
designation as a participant under the Plan. 
  
 19. Unfunded
Plan. Participants shall have no right, title, or interest whatsoever in or to any investments which the Company may make to aid it in meeting its obligations under the Plan. Nothing contained in the Plan, and no action taken pursuant to its
provisions, shall create or be construed to create a trust of any kind, or a fiduciary relationship between the Company and any participant, beneficiary, legal representative or any other person. To the extent that any person acquires a right to
receive payments from the Company under the Plan, such right shall be no greater than the right of an unsecured general creditor of the Company. All payments to be made hereunder shall be paid from the general funds of the Company and no special or
separate fund shall be established and no segregation of assets shall be made to assure payment of such amounts except as expressly set forth in the Plan. The Plan is not intended to be subject to the Employee Retirement Income Security Act of 1974,
as amended. 
  
 20. No Fractional Shares. No fractional
shares of Common Stock shall be issued or delivered pursuant to the Plan or any Benefit. The Committee shall determine whether cash, or Benefits, or other property shall be issued or paid in lieu of fractional shares or whether such fractional
shares or any rights thereto shall be forfeited or otherwise eliminated. 
  
 21. Duration, Amendment and Termination. No Benefit shall be granted more than ten (10) years after the earlier of the Effective Date or the date of shareholder approval of the Plan and, unless shareholders
re-approve the business criteria described in Section 11 hereof in the first shareholder’s meeting that occurs five (5) years after the Effective Date, no Performance-Based Award shall be granted more than five (5) years after the Effective
Date. The Committee may amend the Plan from time to time or suspend or terminate the Plan at any time. No amendment of the Plan may be 
  

 14 

 made without approval of the stockholders of the Company if the amendment will: (i) disqualify any Incentive Stock
Options granted under the Plan; (ii) increase the aggregate number of shares of Common Stock that may be delivered through Stock Options under the Plan; (iii) increase the maximum amounts which can be paid to an individual participant under the Plan
as set forth in Section 5(a)(ii) hereof; (iv) permit the Committee to grant Stock Options with a per share exercise price less than Fair Market Value on the date of grant; (v) change the types of business criteria on which Performance-Based Awards
are to be based under the Plan; (vi) permit the Committee to re-price, substitute, replace or buy out Stock Options or Stock Appreciation Rights with an exercise price or grant price less than the Fair Market Value of the Common Stock underlying
such Stock Option or Stock Appreciation Right; (vii) modify the requirements as to eligibility for participation in the Plan; or (viii) take any action which would otherwise require shareholder approval under the rules of the New York Stock Exchange
or applicable law. 
  
 22. Governing Law. This Plan,
Benefits granted hereunder and actions taken in connection herewith shall be governed and construed in accordance with the laws of the State of Delaware (regardless of the law that might otherwise govern under applicable Delaware principles of
conflict of laws). 
  
 23. Effective Date. The Plan shall
be effective as of November 7, 2003 (the “Effective Date”), provided that the Plan is approved by the stockholders of the Company at an annual meeting or any special meeting of stockholders of the Company within twelve (12) months
of the Effective Date, and such approval of stockholders shall be a condition to the right of each participant to receive any Benefits hereunder. Any Benefits granted under the Plan prior to such approval of stockholders shall be effective as of the
date of grant (unless, with respect to any Benefit, the Committee specifies otherwise at the time of grant), but no such Benefit may be exercised or settled and no restrictions relating to any Benefit may lapse prior to such stockholder approval,
and if stockholders fail to approve the Plan as specified hereunder, any such Benefit shall be cancelled. 
  

 15 

 Index of Defined Terms 
  

			
	 Term

	  	 Section
 Where
Defined
 or First
 Used

	 Benefits
	  	4
	 Beneficially Own (plan limits)
	  	5(a)(ii)(F)
	 Beneficial Owner (COC defn)
	  	13(d)(ii)(A)
	 Board
	  	2(a)
	 Capital Stock (plan limits)
	  	5(a)(ii)(F)
	 Cash Awards
	  	10
	 Cause
	  	13(d)(i)
	 Change in Control
	  	13(d)(ii)
	 Code
	  	2(a)
	 Committee
	  	2(a)
	 Common Stock
	  	5(a)(1)(A)
	 Company
	  	1
	 Covered Employee
	  	5(a)(ii)(C)
	 Dividend Equivalent Right
	  	9(c)
	 Effective Date
	  	23
	 Exchange Act
	  	2(a)
	 Fair Market Value
	  	16
	 Good Reason
	  	13(d)(iii)
	 Incentive Stock Option
	  	6(a)
	 Non-Employee Director
	  	2(a)
	 Nonqualified Stock Options
	  	6(a)
	 Outside Directors
	  	2(a)
	 Parent Corporation
	  	6(e)
	 Performance-Based Awards
	  	11(a)
	 Performance-Type Award
	  	13(c)(iii)
	 Plan
	  	1
	 Restricted Stock
	  	8
	 Restricted Stock Awards
	  	8(a)
	 Restricted Stock Unit
	  	9(c)
	 Stock Appreciation Rights
	  	7
	 Stock Options
	  	6(a)
	 Subsidiary Corporation
	  	6(e)
	 Taxes
	  	12(b)

  

 16

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