Document:

f10q1210ex10ii_techprec.htm

 

Exhibit 10.2

 

TECHPRECISION CORPORATION

2006 Long-Term Incentive Plan

As Restated Effective November 22, 2010

1.    Purpose; Definitions.

      The purpose of the Techprecision Corporation 2006 Long-Term Incentive Plan (the “Plan”) is to enable Techprecision Corporation (the “Company”) to attract, retain and reward key employees of the Company and its Subsidiaries and Affiliates, and others who provide services to the Company and its Subsidiaries and Affiliates, and strengthen the mutuality of interests between such key employees and such other persons and the Company’s stockholders, by offering such key employees and such other persons incentives and/or other equity interests or equity-based incentives in the Company, as well as performance-based incentives payable in cash.

      For purposes of the Plan, the following terms shall be defined as set forth below:

      (a) “Affiliate” means any corporation, partnership, limited liability company, joint venture or other entity, other than the Company and its Subsidiaries, that is designated by the Board as a participating employer under the Plan, provided that the Company directly or indirectly owns at least 20% of the combined voting power of all classes of stock of such entity or at least 20% of the ownership interests in such entity.

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

      (c) “Book Value” means, as of any given date, on a per share basis (i) the stockholders’ equity in the Company as of the last day of the immediately preceding fiscal year as reflected in the Company’s consolidated balance sheet, subject to such adjustments as the Committee shall specify at or after grant, divided by (ii) the number of then outstanding shares of Stock as of such year-end date, as adjusted by the Committee for subsequent events.

      (d) “Cause” means a felony conviction of a participant, or the failure of a participant to contest prosecution for a felony, or a participant’s willful misconduct or dishonesty, or breach of trust or other action by which the participant obtains personal gain at the expense of or to the detriment of the Company or conduct which results in civil or criminal liability or penalties, including penalties pursuant to a consent decree, order or agreement, on the part of the Company; provided, however, that if the participant has an Employment Agreement with the Company, a Subsidiary or Affiliate which includes a definition of “cause,” then “cause” shall have the meaning as defined in such Employment Agreement.

      (e) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto.

      (f) “Commission” means the Securities and Exchange Commission or any successor thereto.

 

 

  

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      (g) “Committee” means the Committee referred to in Section 2 of the Plan. If at any time no Committee shall be in office, then the functions of the Committee specified in the Plan shall be exercised by the Board.

      (h) “Company” means Techprecision Corporation, a Delaware corporation, or any successor corporation.

      (i) “Deferred Stock” means an award made pursuant to Section 8 of the Plan of the right to receive Stock at the end of a specified deferral period.

      (j) “Disability” means disability as determined under procedures established by the Committee for purposes of the Plan; provided that if the participant has an Employment Agreement with the Company, a Subsidiary or Affiliate which includes a definition of “disability,” then “disability” shall have the meaning as defined in such Employment Agreement.

      (k) “Early Retirement” means retirement, with the express consent for purposes of the Plan of the Company at or before the time of such retirement, from active employment with the Company and any Subsidiary or Affiliate pursuant to the early retirement provisions of the applicable pension plan of such entity.

      (l) “Employment Agreement” shall mean an employment or consulting agreement or other agreement pursuant to which the participant performs services for the Company or a Subsidiary or Affiliate.

      (m) “Exchange Act” means the Securities Exchange Act of 1934, as amended, from time to time, and any successor thereto.

      (n) “Fair Market Value” means, as of any given date, the market price of the Stock as determined by or in accordance with the policies established by the Committee in good faith; provided, that, in the case of an Incentive Stock Option, the Fair Market Value shall be determined in accordance with the Code and the Treasury regulations under the Code.

      (o) “Incentive Stock Option” means any Stock Option intended to be and designated as an “Incentive Stock Option” within the meaning of Section 422 of the Code.

      (p) “Independent Director” shall mean a “non-employee director” as set forth in Rule 16b-3 of the Commission pursuant to the Exchange Act or any successor definition adopted by the Commission; provided that in the event that said rule (or successor rule) shall not have such a definition, the term Independent Director shall mean a director of the Company who is not otherwise employed by the Company or any Subsidiary or Affiliate; provided, however, an Independent Director shall also be an independent director as determined by the rules or regulations of the principal stock exchange or market on which the Stock is traded or, if the Stock is not listed or traded on such exchange, as defined under the rules of the Nasdaq Stock Market.

 

 

  

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      (q) “Non-Qualified Stock Option” means any Stock Option that is not an Incentive Stock Option.

      (r) “Normal Retirement” means retirement from active employment with the Company and any Subsidiary or Affiliate on or after age 65 or such other age as is designated by the Company, Subsidiary or Affiliate as the normal retirement age.

      (s) “Other Stock-Based Award” means an award under Section 10 of the Plan that is valued in whole or in part by reference to, or is otherwise based on, Stock.

      (t) “Plan” means this Techprecision Corporation 2006 Long-Term Incentive Plan, as hereinafter amended from time to time.

      (u) “Restricted Stock” means an award of shares of Stock that is subject to restrictions under Section 7 of the Plan.

      (v) “Retirement” means Normal Retirement or Early Retirement.

      (w) “Stock” means the common stock, par value $.0001 per share, of the Company or any class of common stock into which such common stock may hereafter be converted or for which such common stock may be exchanged pursuant to the Company’s certificate of incorporation or as part of a recapitalization, reorganization or similar transaction.

      (x) “Stock Appreciation Right” means the right pursuant to an award granted under Section 6 of the Plan to surrender to the Company all (or a portion) of a Stock Option in exchange for an amount equal to the difference between (i) the Fair Market Value, as of the date such award or Stock Option (or such portion thereof) is surrendered, of the shares of Stock covered by such Stock Option (or such portion thereof), subject, where applicable, to the pricing provisions in Section 6(b)(ii) of the Plan and (ii) the aggregate exercise price of such Stock Option or base price with respect to such award (or the portion thereof which is surrendered).

      (y) “Stock Option” or “Option” means any option to purchase shares of Stock (including Restricted Stock and Deferred Stock, if the Committee so determines) granted pursuant to Section 5 of the Plan.

      (z) “Stock Purchase Right” means the right to purchase Stock pursuant to Section 9 of the Plan.

      (aa) “Subsidiary” means any corporation or other business association, including a partnership (other than the Company) in an unbroken chain of corporations or other business associations beginning with the Company if each of the corporations or other business associations (other than the last corporation in the unbroken chain) owns equity interests (including stock or partnership interests) possessing 50% or more of the total combined voting power of all classes of equity in one of the other corporations or other business associations in the chain. The Board may elect to treat as a Subsidiary an entity in which the Company possesses less than 50% of the total combined voting power of all classes of equity if, under generally accepted accounting principles, the Company may include the financial statements of such entity as part of the Company’s consolidated financial statements (other than as a minority interest or other single line item).

 

 

  

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      In addition, the terms “Change in Control,” “Potential Change in Control” and “Change in Control Price” shall have meanings set forth, respectively, in Sections 11(b), (c) and (d) of the Plan.

2. Administration.

      (a) The Plan shall be administered by a Committee of not less than two directors all of whom shall be Independent Directors, who shall be appointed by the Board and who shall serve at the pleasure of the Board. If and to the extent that no Committee exists which has the authority to administer the Plan, the functions of the Committee specified in the Plan shall be exercised by the Board.

      (b) The Committee shall have full authority to grant, pursuant to the terms of the Plan, to officers and other persons eligible under Section 4 of the Plan, provided that Independent Directors shall not be eligible for options or other benefits pursuant to the Plan other than as provided in Sections 4(b) and 4(c) of the Plan: Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock, Stock Purchase Rights and/or Other Stock-Based Awards. In

particular, the Committee shall have the authority:

            (i) to select the officers and other eligible persons to whom Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock, Stock Purchase Rights and/or Other Stock-Based Awards may from time to time be granted pursuant to the Plan;

            (ii) to determine whether and to what extent Incentive Stock Options, Non-Qualified Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock, Stock Purchase Rights and/or Other Stock-Based Awards, or any combination thereof, are to be granted pursuant to the Plan, to one or more eligible persons;

            (iii) to determine the number of shares to be covered by each such award granted pursuant to the Plan;

            (iv) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any award granted under the Plan, including, but not limited to, the share price or exercise price and any restriction or limitation, or any vesting, acceleration or waiver of forfeiture restrictions regarding any Stock Option or other award and/or the shares of Stock relating thereto, based in each case on such factors as the Committee shall, in its sole discretion, determine;

            (v) to determine whether, to what extent and under what circumstances a Stock Option may be settled in cash, Restricted Stock and/or Deferred Stock under Section 5(b)(x) or (xi) of the Plan, as applicable, instead of Stock;

 

 

  

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            (vi) to determine whether, to what extent and under what circumstances Option grants and/or other awards under the Plan and/or other cash awards made by the Company are to be made, and operate, on a tandem basis with other awards under the Plan and/or cash awards made outside of the Plan in a manner whereby the exercise of one award precludes, in whole or in part, the exercise of another award, or on an additive basis;

            (vii) to determine whether, to what extent and under what circumstances Stock and other amounts payable with respect to an award under this Plan shall be deferred either automatically or at the election of the participant, including any provision for any determination or method of determination of the amount (if any) deemed be earned on any deferred amount during any deferral period;

            (viii) to determine the terms and restrictions applicable to Stock Purchase Rights and the Stock purchased by exercising such Rights; and

            (ix) to determine an aggregate number of awards and the type of awards to be granted to eligible persons employed or engaged by the Company and/or any specific Subsidiary, Affiliate or division and grant to management the authority to grant such awards, provided that no awards to any person subject to the reporting and short-swing profit provisions of Section 16 of the Exchange Act may be granted awards except by the Committee.

      (c) In the event that any officers or other participants have Employment Agreements with the Company which provide for the grant of options to such participants, unless the Committee or the Board otherwise determines, the options shall be treated for all purposes as if they were granted pursuant to this Plan as long as there is a sufficient number of shares available for grant pursuant to this Plan.

      (d) The Committee shall have the authority to adopt, alter and repeal such rules, guidelines and practices governing the Plan as it shall, from time to time, deem advisable; to interpret the terms and provisions of the Plan and any award issued under the Plan and any agreements relating thereto, and otherwise to supervise the administration of the Plan.

      (e) All decisions made by the Committee pursuant to the provisions of the Plan shall be made in the Committee’s sole discretion and shall be final and binding on all persons, including the Company and Plan participants.

3. Stock Subject to Plan.

      (a) The total number of shares of Stock reserved and available for distribution under the Plan shall be three million (3,000,000) shares of Stock. In the event that awards are granted in tandem such that the exercise of one award precludes the exercise of another award then, for the purpose of determining the number of shares of Stock as to which awards shall have been granted, the maximum number of shares of Stock issuable pursuant to such tandem awards shall be used.

 

 

  

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      (b) Subject to Section 6(b)(v) of the Plan, if any shares of Stock that have been optioned cease to be subject to a Stock Option, or if any such shares of Stock that are subject to any Restricted Stock or Deferred Stock award, Stock Purchase Right or Other Stock-Based Award granted under the Plan are forfeited or any such award otherwise terminates without a payment being made to the participant in the form of Stock, such shares shall again be available for

distribution in connection with future awards under the Plan.

      (c) In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, stock distribution, reverse split, combination of shares or other change in corporate structure affecting the Stock, such substitution or adjustment shall be made in the aggregate number of shares reserved for issuance under the Plan, in the base number of shares, in the number and option price of shares subject to outstanding Options granted under the Plan, in the number and purchase price of shares subject to outstanding Stock Purchase Rights under the Plan, and in the number of shares subject to other outstanding awards granted under the Plan as may be determined to be appropriate by the Committee, in its sole discretion, provided that the number of shares subject to any award shall always be a whole number, and provided that the treatment of such options and rights shall be consistent with the nature of the event. Such adjusted option price shall also be used to determine the amount payable by the Company upon the exercise of any Stock Appreciation Right associated with any Stock Option.

4. Eligibility.

      (a) Officers and other key employees and directors of, and consultants and independent contractors to, the Company and its Subsidiaries and Affiliates (but excluding, except as to Sections 4(b) and 4(c) of the Plan, Independent Directors) who are responsible for or contribute to the management, growth and/or profitability of the business of the Company and/or its Subsidiaries and Affiliates are eligible to be granted awards under the Plan.

      (b) On each July 1st of each year, commencing in with the applicable year, as hereinafter defined, each person who is a Independent Director on such date shall automatically be granted a Non-Qualified Stock Option to purchase five thousand (5,000) shares of Stock (or such lesser number of shares of Stock as remain available for grant at such date under the Plan, divided by the number of Independent Directors at such date). Such Stock Options shall be exercisable at a price per share equal to the greater of the Fair Market Value on the date of grant or the par value of one share of Stock. The Non-Qualified Stock Options granted pursuant to this Section 4(b) shall become exercisable cumulatively as to fifty percent (50%) of the shares subject thereto six months from the date of grant and as to the remaining fifty percent (50%), eighteen months from the date of grant, and shall expire on the first to occur of (i) five years from the date of grant, or (ii) seven (7) months from the date such Independent Director ceases to be a director if such Independent Director ceases to be a director other than as a result of his death or Disability, or (iii) twelve (12) months from the date of death or Disability. As used in this Section 4(b), the applicable year shall mean 2009 with respect to the Independent Directors who were Independent Directors on or prior to July 31, 2006, and the year in which the July 1st coincides with or follows the third anniversary of his or her initial election as a director with respect to Independent Directors who were first elected as a director subsequent to July 31, 2006. The provisions of this Section 4(b) and said Section 4(c) may not be amended more than one (1) time in any six (6) month period other than to comply with changes in the Code or the Employee Retirement Income Security Act (“ERISA”) or the rules thereunder.

 

 

  

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      (c) At the time an Independent Director is first elected to the Board, such person shall automatically be granted a Non-Qualified Stock Option as follows:

            (i) With respect to Independent Directors who are directors on of prior to July 31, 2006, such Independent Directors shall receive an option to purchase fifty thousand (50,000) shares of Stock (or such lesser number of shares of Stock as remain available for grant at such date under the Plan, divided by the number of Independent Directors who are elected as directors at such date). Such Stock Options shall be exercisable at a price per share equal to the greater of the Fair Market Value on the date of grant or the par value of one share of Stock, as follows. The Stock Option shall be immediately exercisable as to thirty thousand (30,000) shares of Stock and shall become exercisable cumulatively as to ten thousand (10,000) shares of Stock on each of February 24, 2007 and February 24, 2008. The option shall expire on the first to occur of (x) five years from the date of the Independent Director’s first election as a director, or (y) seven (7) months from the date such Independent Director ceases to be a director if such Independent Director ceases to be a director other than as a result of his death or Disability or (z) twelve (12) months after the date of death or Disability. The options granted pursuant to this Section 4(c)(i) shall constitute a grant of twenty five thousand (25,000) shares in addition to the twenty five thousand (25,000) shares granted prior to the July 27, 2006 amendment to the Plan with the vesting schedule of the combined option to be as set forth in this Section 4(c)(i).

            (ii) With respect to Independent Directors who are first elected to the board subsequent to July 31, 2006, such Independent Directors shall receive a five-year option to purchase fifty thousand (50,000) shares of Stock (or such lesser number of shares of Stock as remain available for grant at such date under the Plan, divided by the number of Independent Directors who are elected as directors at such date). Such Stock Options shall be exercisable at a price per share equal to the greater of the Fair Market Value on the date of grant or the par value of one share of Stock, as follows. The Stock Option shall be exercisable as to thirty thousand (30,000) shares of Stock six months from the date of grant and shall become exercisable cumulatively as to ten thousand (10,000) shares of Stock on each of first and second anniversaries of the date of grant. The option shall expire on the first to occur of (x) five years from the date of grant, or (y) seven (7) months from the date such Independent Director ceases to be a director if such Independent Director ceases to be a director other than as a result of his death or Disability or (z) twelve (12) months after the date of death or Disability.

      (d) Options granted pursuant to Sections 4(b) and 4(c) may be exercised only by the Independent Director or, in the case of his or her death or Disability, by his or her legal representative. In no event may the Option be exercised with respect to any shares of Stock as to which the Option becomes exercisable after the date on which the Independent Director ceases to be a director.

 

 

  

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5. Stock Options.

      (a) Administration. Stock Options may be granted alone, in addition to or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. Any Stock Option granted under the Plan shall be in such form as the Committee may from time to time approve. Stock Options granted under the Plan may be of two types: (i) Incentive Stock Options and (ii) Non-Qualified Stock Options. The Committee shall have the authority to grant to any optionee Incentive Stock Options, Non-Qualified Stock Options, or both types of Stock Options (in each case with or without Stock Appreciation Rights).

      (b) Option Grants. Options granted under the Plan shall be subject to the following terms and conditions and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Committee, in its sole discretion, shall deem desirable:

            (i) Option Price. The option price per share of Stock purchasable under a Stock Option shall be determined by the Committee at the time of grant.

            (ii) Option Term. The term of each Stock Option shall be fixed by the Committee, but no Stock Option shall be exercisable more than ten (10) years after the date the Option is granted.

            (iii) Exercisability. Stock Options shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee at or after grant. If the Committee provides, in its sole discretion, that any Stock Option is exercisable only in installments, the Committee may waive such installment exercise provisions at any time at or after grant in whole or in part, based on such factors as the Committee shall, in its sole discretion, determine.

            (iv) Method of Exercise.

                 (A) Subject to whatever installment exercise provisions apply under Section 5(b)(iii) of the Plan, Stock Options may be exercised in whole or in part at any time during the option period, by giving written notice of exercise to the Company specifying the number of shares to be purchased. Such notice shall be accompanied by payment in full of the purchase price, either by check, note or such other instrument, securities or property as the Committee may accept. As and to the extent determined by the Committee, in its sole discretion, at or after grant, payments in full or in part may also be made in the form of Stock already owned by the optionee or, in the case of the exercise of a Non-Qualified Stock Option, Restricted Stock or Deferred Stock subject to an award hereunder (based, in each case, on the Fair Market Value of the Stock on the date the option is exercised, as determined by the Committee).

                  (B) If payment of the option exercise price of a Non-Qualified Stock Option is made in whole or in part in the form of Restricted Stock or

Deferred Stock, the Stock issuable upon such exercise (and any replacement shares relating thereto) shall remain (or be) restricted or deferred, as the case may be, in accordance with the original terms of the Restricted Stock award or Deferred Stock award in question, and any additional Stock received upon the exercise shall be subject to the same forfeiture restrictions or deferral limitations, unless otherwise determined by the Committee, in its sole discretion, at or after grant.

 

 

  

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                  (C) No shares of Stock shall be issued until full payment therefor has been received by the Company. In the event of any exercise by note or other instrument, the shares of Stock shall not be issued until such note or other instrument shall have been paid in full, and the exercising optionee shall have no rights as a stockholder until such payment is made.

                  (D) Subject to Section 5(b)(iv)(C) of the Plan, an optionee shall generally have the rights to dividends or other rights of a stockholder with respect to shares subject to the Option when the optionee has given written notice of exercise, has paid in full for such shares, and, if requested, has given the representation described in Section 14(a) of the Plan.

            (v) Non-Transferability of Options. No Stock Option shall be transferable by the optionee otherwise than by will or by the laws of descent and distribution, and all Stock Options shall be exercisable, during the optionee’s lifetime, only by the optionee.

            (vi) Termination by Death. Subject to Section 5(b)(ix) of the Plan with respect to Incentive Stock Options, if an optionee’s employment by the Company and any Subsidiary or Affiliate terminates by reason of death, any Stock Option held by such optionee may thereafter be exercised, to the extent such option was exercisable at the time of death or on such accelerated basis as the Committee may determine at or after grant (or as may be determined in accordance with procedures established by the Committee), by the legal representative of the estate or by the legatee of the optionee under the will of the optionee, for a period of one year (or such other period as the Committee may specify at grant) from the date of such death or until the expiration of the stated term of such Stock Option, whichever period is the shorter.

            (vii) Termination by Reason of Disability or Retirement. Subject to Section 5(b)(ix) of the Plan with respect to Incentive Stock Options, if an optionee’s employment by the Company and any Subsidiary or Affiliate terminates by reason of a Disability or Normal or Early Retirement, any Stock Option held by such optionee may thereafter be exercised by the optionee, to the extent it was exercisable at the time of termination or on such accelerated basis as the Committee may determine at or after grant (or as may be determined in accordance with procedures established by the Committee), for a period of one year (or such other period as the Committee may specify at grant) from the date of such termination of employment or until the expiration of the stated term of such Stock Option, whichever period is the shorter; provided, however, that, if the optionee dies within such one-year period (or such other period as the Committee shall specify at grant), any unexercised Stock Option held by such optionee shall thereafter be exercisable to the extent to which it was exercisable at the time of death for a period of one year from the date of such death or until the expiration of the stated term of such Stock Option, whichever period is the shorter. In the event of termination of employment by reason of Disability or Normal or Early Retirement, if an Incentive Stock Option is exercised after the expiration of the exercise periods that apply for purposes of Section 422 of the Code, such Stock Option will thereafter be treated as a Non-Qualified Stock Option.

 

 

  

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            (viii) Other Termination. Unless otherwise determined by the Committee (or pursuant to procedures established by the Committee) at or after grant, if an optionee’s employment by the Company and any Subsidiary or Affiliate terminates for any reason other than death, Disability or Normal or Early Retirement, the Stock Option shall thereupon terminate; provided, however, that if the optionee is involuntarily terminated by the Company or any Subsidiary or Affiliate without Cause, including a termination resulting from the Subsidiary, Affiliate or division in which the optionee is employed or engaged, ceasing, for any reason, to be a Subsidiary, Affiliate or division of the Company, such Stock Option may be exercised, to the extent otherwise exercisable on the date of termination, for a period of three months (or seven months in the case of a person subject to the reporting and short-swing profit provisions of Section 16 of the Exchange Act) from the date of such termination or until the expiration of the stated term of such Stock Option, whichever is shorter.

            (ix) Incentive Stock Options.

                  (A) Anything in the Plan to the contrary notwithstanding, no term of the Plan relating to Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be so exercised, so as to disqualify the Plan under Section 422 of the Code, or, without the consent of the optionee(s) affected, to disqualify any Incentive

Stock Option under such Section 422.

                  (B) To the extent required for “incentive stock option” status under Section 422(d) of the Code (taking into account applicable Treasury regulations and pronouncements), the Plan shall be deemed to provide that the aggregate Fair Market Value (determined as of the time of grant) of the Stock with respect to which Incentive Stock Options are exercisable for the first time by the optionee during any calendar year under the Plan and/or any other stock option plan of the Company or any Subsidiary or parent corporation (within the meaning of Section 425 of the Code) shall not exceed $100,000. If Section 422 is hereafter amended to delete the requirement now in Section 422(d) that the plan text expressly provide for the $100,000 limitation set forth in Section 422(d), then this Section 5(b)(ix)(B) shall no longer be operative and the Committee may accelerate the dates on which the incentive stock option may be exercised.

                  (C) To the extent permitted under Section 422 of the Code or the applicable regulations thereunder or any applicable Internal Revenue Service pronouncement:

                        (I) If (x) a participant’s employment is terminated by reason of death, Disability or Retirement and (y) the portion of any Incentive Stock Option that is otherwise exercisable during the post-termination period specified under Sections 5(b)(vi) and (vii) of the Plan, applied without regard to the $100,000 limitation contained in Section 422(d) of the Code, is greater than the portion of such option that is immediately exercisable as an “incentive stock option” during such post-termination period under Section 422, such excess shall be treated as a Non-Qualified Stock Option; and

 

 

  

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                        (II) if the exercise of an Incentive Stock Option is accelerated by reason of a Change in Control, any portion of such option that is not exercisable as an Incentive Stock Option by reason of the $100,000 limitation contained in Section 422(d) of the Code shall be treated as a Non-Qualified Stock Option.

            (x) Buyout Provisions. The Committee may at any time offer to buy out for a payment in cash, Stock, Deferred Stock or Restricted Stock an option previously granted, based on such terms and conditions as the Committee shall establish and communicate to the optionee at the time that such offer is made.

            (xi) Settlement Provisions. If the option agreement so provides at grant or is amended after grant and prior to exercise to so provide (with the optionee’s consent), the Committee may require that all or part of the shares to be issued with respect to the spread value of an exercised Option take the form of Deferred or Restricted Stock which shall be valued on the date of exercise on the basis of the Fair Market Value (as determined by the Committee) of such Deferred or Restricted Stock determined without regard to the deferral limitations and/or forfeiture restrictions involved.

6. Stock Appreciation Rights.

      (a) Grant and Exercise.

            (i) Stock Appreciation Rights may be granted in conjunction with all or part of any Stock Option granted under the Plan. In the case of a Non-Qualified Stock Option, such rights may be granted either at or after the time of the grant of such Stock Option. In the case of an Incentive Stock Option, such rights may be granted only at the time of the grant of such Stock Option.

            (ii) A Stock Appreciation Right or applicable portion thereof granted with respect to a given Stock Option shall terminate and no longer be exercisable upon the termination or exercise of the related Stock Option, subject to such provisions as the Committee may specify at grant where a Stock Appreciation Right is granted with respect to less than the full number of shares covered by a related Stock Option.

            (iii) A Stock Appreciation Right may be exercised by an optionee, subject to Section 6(b) of the Plan, in accordance with the procedures established by the Committee for such purpose. Upon such exercise, the optionee shall be entitled to receive an amount determined in the manner prescribed in said Section 6(b). Stock Options relating to exercised Stock Appreciation Rights shall no longer be exercisable to the extent that the related Stock Appreciation Rights have been exercised.

 

 

  

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      (b) Terms and Conditions. Stock Appreciation Rights shall be subject to such terms and conditions, not inconsistent with the provisions of the Plan, as shall be determined from time to time by the Committee, including the following:

            (i) Stock Appreciation Rights shall be exercisable only at such time or times and to the extent that the Stock Options to which they relate shall be exercisable in accordance with the provisions of this Section 6 and Section 5 of the Plan; provided, however, that any Stock Appreciation Right granted to an optionee subject to Section 16(b) of the Exchange Act subsequent to the grant of the related Stock Option shall not be exercisable during the first six months of its term, except that this special limitation shall not apply in the event of death or Disability of the optionee prior to the expiration of the six-month period. The exercise of Stock Appreciation Rights held by optionees who are subject to Section 16(b) of the Exchange Act shall comply with Rule 16b-3 thereunder to the extent applicable.

            (ii) Upon the exercise of a Stock Appreciation Right, an optionee shall be entitled to receive an amount in cash and/or shares of Stock equal in value to the excess of the Fair Market Value of one share of Stock over the option price per share specified in the related Stock Option multiplied by the number of shares in respect of which the Stock Appreciation Right shall have been exercised, with the Committee having the right to determine the form of payment. When payment is to be made in shares of Stock, the number of shares to be paid shall be calculated on the basis of the Fair Market Value of the shares on the date of exercise. When payment is to be made in cash, such amount shall be based upon the Fair Market Value of the Stock on the date of exercise, determined in a manner not inconsistent with Section 16(b) of the Exchange Act and the rules of the Commission thereunder.

            (iii) Stock Appreciation Rights shall be transferable only when and to the extent that the underlying Stock Option would be transferable under Section 5(b)(v) of the Plan.

            (iv) Upon the exercise of a Stock Appreciation Right, the Stock Option or part thereof to which such Stock Appreciation Right is related shall be deemed to have been exercised only to the extent of the number of shares issued under the Stock Appreciation Right at the time of exercise based on the value of the Stock Appreciation Right at such time.

            (v) In its sole discretion, the Committee may grant Stock Appreciation Rights that become exercisable only in the event of a Change in Control and/or a Potential Change in Control, subject to such terms and conditions as the Committee may specify at grant; provided that any such Stock Appreciation Rights shall be settled solely in cash.

            (vi) The Committee, in its sole discretion, may also provide that, in the event of a Change in Control and/or a Potential Change in Control, the amount to be paid upon the exercise of a Stock Appreciation Right shall be based on the Change in Control Price, subject to such terms and conditions as the Committee may specify at grant.

 

 

  

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7. Restricted Stock.

      (a) Administration. Shares of Restricted Stock may be issued either alone, in addition to or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. The Committee shall determine the eligible persons to whom, and the time or times at which, grants of Restricted Stock will be made, the number of shares to be awarded, the price (if any) to be paid by the recipient of Restricted Stock, subject to Section 7(b) of the Plan, the time or times within which such awards may be subject to forfeiture, and all other terms and conditions of the awards. The Committee may condition the grant of Restricted Stock upon the attainment of specified performance goals or such other factors as the Committee may, in its sole discretion, determine. The provisions of Restricted Stock awards need not be the same with respect to each

recipient.

      (b) Awards and Certificates.

            (i) The prospective recipient of a Restricted Stock award shall not have any rights with respect to such award unless and until such recipient has executed an agreement evidencing the award and has delivered a fully executed copy thereof to the Company, and has otherwise complied with the applicable terms and conditions of such award.

            (ii) The purchase price for shares of Restricted Stock may be equal to or less than their par value and may be zero.

            (iii) Awards of Restricted Stock must be accepted within a period of 60 days (or such shorter period as the Committee may specify at grant) after the award date, by executing a Restricted Stock Award Agreement and paying the price, if any, required under Section 7(b)(ii).

            (iv) Each participant receiving a Restricted Stock award shall be issued a stock certificate in respect of such shares of Restricted Stock. Such certificate shall be registered in the name of such participant, and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such award.

            (v) The Committee shall require that (A) the stock certificates evidencing shares of Restricted Stock be held in the custody of the Company until the restrictions thereon shall have lapsed, and (B) as a condition of any Restricted Stock award, the participant shall have delivered a stock power, endorsed in blank, relating to the Restricted Stock covered by such award.

      (c) Restrictions and Conditions. The shares of Restricted Stock awarded pursuant to this Section 7 shall be subject to the following restrictions and conditions:

            (i) Subject to the provisions of the Plan and the award agreement, during a period set by the Committee commencing with the date of such award (the “Restriction Period”), the participant shall not be permitted to sell, transfer, pledge or assign shares of Restricted Stock awarded under the Plan. Within these limits, the Committee, in its sole discretion, may provide for the lapse of such restrictions in installments and may accelerate or waive such restrictions in whole or in part, based on service, performance and/or such other factors or criteria as the Committee may determine, in its sole discretion.

 

 

  

13

  

 

            (ii) Except as provided in this Section 7(c)(ii) and Section 7(c)(i) of the Plan, the participant shall have, with respect to the shares of Restricted Stock, all of the rights of a stockholder of the Company, including the right to vote the shares and the right to receive any regular cash dividends paid out of current earnings. The Committee, in its sole discretion, as determined at the time of award, may permit or require the payment of cash dividends to be deferred and, if the Committee so determines, reinvested, subject to Section 14(e) of the Plan, in additional Restricted Stock to the extent shares are available under Section 3 of the Plan, or otherwise reinvested. Stock dividends, splits and distributions issued with respect to Restricted Stock shall be treated as additional shares of Restricted Stock that are subject to the same restrictions and other terms and conditions that apply to the shares with respect to which such dividends are issued, and the Committee may require the participant to deliver an additional stock power covering the shares issuable pursuant to such stock dividend, split or distribution. Any other dividends or property distributed with regard to Restricted Stock, other than regular dividends payable and paid out of current earnings, shall be held by the Company subject to the same restrictions as the Restricted Stock.

            (iii) Subject to the applicable provisions of the award agreement and this Section 7, upon termination of a participant’s employment or other services with the Company and any Subsidiary or Affiliate for any reason during the Restriction Period, all shares still subject to restriction will vest, or be forfeited, in accordance with the terms and conditions established by the Committee at or after grant.

            (iv) If and when the Restriction Period expires without a prior forfeiture of the Restricted Stock subject to such Restriction Period, certificates for an appropriate number of unrestricted shares, and other property held by the Company with respect to such Restricted Shares, shall be delivered to the participant promptly.

      (d) Minimum Value Provisions. In order to better ensure that award payments actually reflect the performance of the Company and service of the participant, the Committee may provide, in its sole discretion, for a tandem Stock Option or performance-based or other award designed to guarantee a minimum value, payable in cash or Stock to the recipient of a Restricted Stock award, subject to such performance, future service, deferral and other terms and conditions as may be specified by the Committee.

8. Deferred Stock.

      (a) Administration. Deferred Stock may be awarded either alone, in addition to or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. The Committee shall determine the eligible persons to whom and the time or times at which Deferred Stock shall be awarded, the number of shares of Deferred Stock to be awarded to any person, the duration of the period (the “Deferral Period”) during which, and the conditions under which, receipt of the Stock will be deferred, and the other terms and conditions of the award in addition to those set forth in Section 8(b). The Committee may condition the grant of Deferred Stock upon the attainment of specified performance goals or such other factors or criteria as the Committee shall, in its sole discretion, determine. The provisions of Deferred Stock awards need not be the same with respect to each recipient.

  

 

  

14

  

 

    (b) Terms and Conditions. The shares of Deferred Stock awarded pursuant to this Section 8 shall be subject to the following terms and conditions:

            (i) Subject to the provisions of the Plan and the award agreement referred to in Section 8(b)(vi) of the Plan, Deferred Stock awards may not be sold, assigned, transferred, pledged or otherwise encumbered during the Deferral Period. At the expiration of the Deferral Period (or the Elective Deferral Period referred to in Section 8(b)(v) of the Plan, where applicable), share certificates representing the shares covered by the Deferred Stock award shall be delivered to the participant or his legal representative.

            (ii) Unless otherwise determined by the Committee at grant, amounts equal to any dividends declared during the Deferral Period with respect to the number of shares covered by a Deferred Stock award will be paid to the participant currently, or deferred and deemed to be reinvested in additional Deferred Stock, or otherwise reinvested, all as determined at or after the time of the award by the Committee, in its sole discretion.

            (iii) Subject to the provisions of the award agreement and this Section 8, upon termination of a participant’s employment with the Company and any Subsidiary or Affiliate for any reason during the Deferral Period for a given award, the Deferred Stock in question will vest, or be forfeited, in accordance with the terms and conditions established by the Committee at or after grant.

            (iv) Based on service, performance and/or such other factors or criteria as the Committee may determine, the Committee may, at or after grant, accelerate the vesting of all or any part of any Deferred Stock award and/or waive the deferral limitations for all or any part of such award.

            (v) A participant may elect to further defer receipt of an award (or an installment of an award) for a specified period or until a specified event (the “Elective Deferral Period”), subject in each case to the Committee’s approval and to such terms as are determined by the Committee, all in its sole discretion. Subject to any exceptions adopted by the Committee, such election must generally be made at least twelve months prior to completion of the Deferral Period for such Deferred Stock award (or such installment).

            (vi) Each award shall be confirmed by, and subject to the terms of, a Deferred Stock agreement executed by the Company and the participant.

      (c) Minimum Value Provisions. In order to better ensure that award payments actually reflect the performance of the Company and service of the participant, the Committee may provide, in its sole discretion, for a tandem Stock Option or performance-based or other award designed to guarantee a minimum value, payable in cash or Stock to the recipient of a deferred stock award, subject to such performance, future service, deferral and other terms and conditions as may be specified by the Committee.

 

 

  

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9. Stock Purchase Rights.

      (a) Awards and Administration. The Committee may grant eligible participants Stock Purchase Rights which shall enable such participants to purchase Stock (including Deferred Stock and Restricted Stock):

            (i) at its Fair Market Value on the date of grant;

            (ii) at a percentage of such Fair Market Value on such date, such percentage to be determined by the Committee in its sole discretion;

            (iii) at an amount equal to Book Value on such date; or

            (iv) at an amount equal to the par value of such Stock on such date.

      The Committee shall also impose such deferral, forfeiture and/or other terms and conditions as it shall determine, in its sole discretion, on such Stock Purchase Rights or the exercise thereof. The terms of Stock Purchase Rights awards need not be the same with respect to each participant. Each Stock Purchase Right award shall be confirmed by, and be subject to the terms of, a Stock Purchase Rights Agreement.

      (b) Exercisability. Stock Purchase Rights shall generally be exercisable for such period after grant as is determined by the Committee not to exceed sixty (60) days. However, the Committee may provide, in its sole discretion, that the Stock Purchase Rights of persons potentially subject to Section 16(b) of the Exchange Act shall not become exercisable until six months and one day after the grant date, and shall then be exercisable for ten trading days at the purchase price specified by the Committee in accordance with Section 9(a) of the Plan.

10. Other Stock-Based Awards.

      (a) Administration.

            (i) Other awards of Stock and other awards that are valued in whole or in part by reference to, or are otherwise based on, Stock (“Other Stock-Based Awards”), including, without limitation, performance shares, convertible preferred stock (to the extent a series of preferred stock has been or may be created by, or in accordance with a procedure set forth in, the Company’s certificate of incorporation), convertible debentures, warrants, exchangeable securities and Stock awards or options valued by reference to Fair Market Value, Book Value or performance of the Company or any Subsidiary, Affiliate or division, may be granted either alone or in addition to or in tandem with Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock or Stock Purchase Rights granted under the Plan and/or cash awards made outside of the Plan.

            (ii) Subject to the provisions of the Plan, the Committee shall have authority to determine the persons to whom and the time or times at which such award shall be made, the number of shares of Stock to be awarded pursuant to such awards, and all other conditions of the awards. The Committee may also provide for the grant of Stock upon the completion of a specified performance period. The provisions of Other Stock-Based Awards need not be the same with respect to each recipient.

 

  

16

  

 

 

      (b) Terms and Conditions. Other Stock-Based Awards made pursuant to this Section 10 shall be subject to the following terms and conditions:

            (i) Subject to the provisions of the Plan and the award agreement referred to in Section 10(b)(v) of the Plan, shares of Stock subject to awards made under this Section 10 may not be sold, assigned, transferred, pledged or otherwise encumbered prior to the date on which the shares are issued, or, if later, the date on which any applicable restriction, performance or deferral period lapses.

            (ii) Subject to the provisions of the Plan and the award agreement and unless otherwise determined by the Committee at grant, the recipient of an award under this Section 10 shall be entitled to receive, currently or on a deferred basis, interest or dividends or interest or dividend equivalents with respect to the number of shares covered by the award, as determined at the time of the award by the Committee, in its sole discretion, and the Committee may provide that such amounts (if any) shall be deemed to have been reinvested in additional Stock or otherwise reinvested.

            (iii) Any award under Section 10 and any Stock covered by any such award shall vest or be forfeited to the extent so provided in the award agreement, as determined by the Committee, in its sole discretion.

            (iv) In the event of the participant’s Retirement, Disability or death, or in cases of special circumstances, the Committee may, in its sole discretion, waive in whole or in part any or all of the remaining limitations (if any) imposed with respect to any or all of an award pursuant to this Section 10.

            (v) Each award under this Section 10 shall be confirmed by, and subject to the terms of, an agreement or other instrument by the Company and by the participant.

            (vi) Stock (including securities convertible into Stock) issued on a bonus basis under this Section 10 may be issued for no cash consideration.

 

11. Change in Control Provisions.

      (a) Impact of Event. In the event of a “Change in Control,” as defined in Section 11(b) of the Plan, or a “Potential Change in Control,” as defined in Section 11(c) of the Plan, except to the extent otherwise determined by the Committee or the Board at or after grant (subject to any right of approval expressly reserved by the Committee or the Board at the time of such determination), the following acceleration and valuation provisions shall apply:

            (i) Any Stock Appreciation Rights outstanding for at least six months and any Stock Options awarded under the Plan not previously exercisable and vested shall become fully exercisable and vested and any Incentive Stock Options may, with the consent of the holders thereof, be treated as Non-Qualified Stock Options.

 

 

  

17

  

 

            (ii) The restrictions and deferral limitations applicable to any Restricted Stock, Deferred Stock, Stock Purchase rights and Other Stock-Based Awards, in each case to the extent not already vested under the Plan, shall lapse and such shares and awards shall be deemed fully vested.

            (iii) The value of all outstanding Stock Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock, Stock Purchase Rights and Other Stock-Based Awards, in each case to the extent vested (including such rights which shall have become vested pursuant to Sections 11(a)(i) and (ii) of the Plan), shall be purchased by the Company (“cashout”) in a manner determined by the Committee, in its sole discretion, on the basis of the “Change in Control Price” as defined in Section 11(d) of the Plan as of the date such Change in Control or such Potential Change in Control is determined to have occurred or such other date as the Committee may determine prior to the Change in Control, unless the Committee shall, contemporaneously with or prior to any particular Change of Control or Potential Change of Control, determine that this Section 11(a)(iii) shall not be applicable to such Change in Control or Potential Change in Control.

      (b) Definition of “Change in Control.” For purposes of Section 11(a) of the Plan, a “Change in Control” means the happening of any of the following after the completion of the acquisition of Ranor, Inc., a Delaware corporation (the “Acquisition Effective Date”):

            (i) When any “person” (as defined in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d) and 14(d) of the Exchange Act, including a “group” as defined in Section 13(d) of the Exchange Act, but excluding the Company and any Subsidiary and any employee benefit plan sponsored or maintained by the Company or any Subsidiary and any trustee of such plan acting as trustee) directly or indirectly becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act, as amended from time to time), of securities of the Company representing thirty percent (30%) or more of the combined voting power of the Company’s then outstanding securities; provided, however, that a Change of Control shall not arise if such acquisition is approved by the board of directors or if the board of directors or the Committee determines that such acquisition is not a Change of Control or if the board of directors authorizes the issuance of the shares of Stock (or securities convertible into Stock or upon the exercise of which shares of Stock may be issued) to such persons; or

            (ii) When, during any period of twenty-four consecutive months during the existence of the Plan, the individuals who, at the beginning of such period, constitute the Board (the “Incumbent Directors”) cease for any reason other than death, Disability or Retirement to constitute at least a majority thereof, provided, however, that a director who was not a director at the beginning of such 24-month period shall be deemed to have satisfied such 24-month requirement (and be an Incumbent Director) if such director was elected by, or on the recommendation of, or with the approval of, at least two-thirds of the directors who then qualified as Incumbent Directors either actually (because they were directors at the beginning of such 24-month period) or by prior operation of this Section 11(b)(ii); provided, however, that all directors who are elected to the board not later than six months after the Acquisition Effective Date shall be deemed to be an Incumbent Director and shall be deemed to have satisfied the 24-month requirement set forth in this Section 11(b)(ii); or

 

  

18

  

 

            (iii) The occurrence of a transaction requiring stockholder approval for the acquisition of the Company by an entity other than the Company or a Subsidiary through purchase of assets, or by merger, or otherwise unless approved by a majority of Incumbent Directors.

      (c) Definition of Potential Change in Control. For purposes of Section 11(a) of the Plan, a “Potential Change in Control” means the happening of any one of the following:

            (i) The approval by stockholders of an agreement by the Company, the consummation of which would result in a Change in Control of the Company as defined in Section 11(b) of the Plan; or

            (ii) The acquisition of beneficial ownership, directly or indirectly, by any entity, person or group (other than the Company or a Subsidiary or any Company employee benefit plan or any trustee of such plan acting as such trustee) of securities of the Company representing five percent or more of the combined voting power of the Company’s outstanding securities and the adoption by the Board of Directors of a resolution to the effect that a Potential Change in Control of the Company has occurred for purposes of the Plan.

      (d) Change in Control Price. For purposes of this Section 11, “Change in Control Price” means the highest price per share paid in any transaction reported on the principal stock exchange on which the Stock is traded or the average of the highest bid and asked prices as reported by the principal stock exchange or market on which the Stock is traded, or paid or offered in any bona fide transaction related to a Potential or actual Change in Control of the Company at any time during the sixty-day period immediately preceding the occurrence of the Change in Control (or, where applicable, the occurrence of the Potential Change in Control event), in each case as determined by the Committee except that, in the case of Incentive Stock Options and Stock Appreciation Rights relating to Incentive Stock Options, such price shall be based only on transactions reported for the date on which the optionee exercises such Stock Appreciation Rights, Incentive Stock Options or, where applicable, the date on which a cashout occurs under Section 11(a)(iii).

12. Amendments and Termination.

      (a) The Board may amend, alter, or discontinue the Plan, but no amendment, alteration, or discontinuation shall be made which would impair the rights of an optionee or participant under a Stock Option, Stock Appreciation Right, Restricted or Deferred Stock award, Stock Purchase Right or Other Stock-Based Award theretofore granted, without the optionee’s or participant’s consent, and no amendment will be made without approval of the stockholders if such amendment requires stockholder approval under state law or if stockholder approval is necessary in order that the Plan comply with Rule 16b-3 of the Commission under the Exchange Act or any substitute or successor rule or if stockholder approval is necessary in order to enable the grant pursuant to the Plan of options or other awards intended to confer tax benefits upon the recipients thereof.

 

 

  

19

  

 

      (b) The Committee may amend the terms of any Stock Option or other award theretofore granted, prospectively or retroactively, but no such amendment shall impair the rights or any holder without the holder’s consent. The Committee may also substitute new Stock Options for previously granted Stock Options (on a one for one or other basis), including previously granted Stock Options having higher option exercise prices.

      (c) Subject to the provisions of Sections 12(a) and (b) of the Plan, the Board shall have broad authority to amend the Plan to take into account changes in applicable securities and tax laws and accounting rules, as well as other developments, and, in particular, without limiting in any way the generality of the foregoing, to eliminate any provisions which are not required to included as a result of any amendment to Rule 16b-3 of the Commission pursuant to the Exchange Act.

13. Unfunded Status of Plan.

      The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation. With respect to any payments not yet made to a participant or optionee by the Company, nothing contained in this Plan shall give any such participant or optionee any rights that are greater than those of a general creditor of the Company. In its sole discretion, the Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Stock or payments in lieu of or with respect to awards under this Plan; provided, however, that, unless the Committee otherwise determines with the consent of the affected participant, the existence of such trusts or other arrangements shall be consistent with the “unfunded” status of the Plan.

14. General Provisions.

      (a) The Committee may require each person purchasing shares pursuant to a Stock Option or other award under the Plan to represent to and agree with the Company in writing that the optionee or participant is acquiring the shares without a view to distribution thereof. The certificates for such shares may include any legend which the Committee deems appropriate to reflect any restrictions on transfer. All certificates or shares of Stock or other securities delivered under the Plan shall be subject to such stock-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations, and other requirements of the Commission, any stock exchange upon which the Stock is then listed, and any applicable Federal or state securities law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

      (b) Nothing contained in this Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to stockholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific cases.

      (c) Neither the adoption of the Plan nor the grant of any award pursuant to the Plan shall confer upon any employee of the Company or any Subsidiary or Affiliate any right to continued employment with the Company or a Subsidiary or Affiliate, as the case may be, nor shall it interfere in any way with the right of the Company or a Subsidiary or Affiliate to terminate the employment of any of its employees at any time.

 

 

  

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      (d) No later than the date as of which an amount first becomes includible in the gross income of the participant for Federal income tax purposes with respect to any award under the Plan, the participant shall pay to the Company, or make arrangements satisfactory to the Committee regarding the payment of, any Federal, state, or local taxes of any kind required by law to be withheld with respect to such amount. Unless otherwise determined by the Committee, withholding obligations may be settled with Stock, including Stock that is part of the award that gives rise to the withholding requirement. The obligations of the Company under the Plan shall be conditional on such payment or arrangements and the Company and its Subsidiaries or Affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the participant.

      (e) The actual or deemed reinvestment of dividends or dividend equivalents in additional Restricted Stock (or in Deferred Stock or other types of Plan awards) at the time of any dividend payment shall only be permissible if sufficient shares of Stock are available under Section 3 of the Plan for such reinvestment (taking into account then outstanding Stock Options, Stock Purchase Rights and other Plan awards).

15. Effective Date of Plan.

      The Plan shall be effective as of the date the Plan is approved by the Board, subject to the approval of the Plan by a majority of the votes cast by the holders of the Company’s Stock at the next annual or special meeting of stockholders or by the holders of a majority of the outstanding shares of common stock by a written consent in lieu of a meeting. Any grants made under the Plan prior to such approval shall be effective when made (unless otherwise specified by the Committee at the time of grant), but shall be conditioned on, and subject to, such approval of the Plan by such stockholders.

16. Term of Plan.

      Stock Option, Stock Appreciation Right, Restricted Stock award, Deferred Stock award, Stock Purchase Right or Other Stock-Based Award may be granted pursuant to the Plan, until ten (10) years from the date the Plan was approved by the Board, unless the Plan shall be terminated by the Board, in its discretion, prior to such date, but awards granted prior to such termination may extend beyond that date.

 

 

21f10q1210ex10iii_techprec.htm

Exhibit 10.3

 

PURCHASE AND SALE AGREEMENT

 

This Purchase and Sale Agreement (“Agreement”) is made and entered into this 20th day of December, 2010, by and between WM Realty Management LLC, a Massachusetts limited liability company with an address at 46 Baldwin Farms North, Greenwich, CT 06831 (“Seller”), and Ranor, Inc., a Delaware corporation with an address at 1 Bella Drive, Westminster, MA 01473 (“Buyer”). 

 

Seller is the owner of certain Premises (as hereinafter defined) located at 1 Bella Drive, Westminster, Worcester County, Massachusetts.  Seller now desires to sell and Buyer desires to purchase the Premises and certain tangible and intangible personal property related to the Premises, upon the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the covenants and agreements contained in this Agreement and other good and valuable consideration, and intending to be legally bound, Seller and Buyer agree as follows:

 

	
1.  

	
AGREEMENT TO SELL AND PURCHASE.

 

Subject to the terms and conditions of this Agreement, Seller agrees to sell to Buyer, and Buyer agrees to purchase from Seller the following:

 

(a) Land.  All that certain tract or parcel of land described by metes and bounds in Exhibit A to this Agreement (the “Land”) (which Land shall not include the three residential lots as shown on the ANR Plan attached hereto as Exhibit B and made a part hereof which lots are part of the Land currently, but which will be separate from the Land after recording of the ANR Plan in accordance with Section 12 hereof.

 

(b) Improvements.  The buildings and other improvements located on the Land, including all fixtures, electrical, heating, ventilating, air conditioning, plumbing, security, fire suppression and other mechanical systems (the “Improvements”).

 

(c) Appurtenances.  All easements, rights of way, licenses, privileges, hereditaments and appurtenances, if any, belonging to or inuring to the benefit of the Land, and all right, title and interest of Seller in and to any land lying in the bed of any highway, street, road or avenue, opened or proposed, in front of or abutting or adjoining the Land (collectively, the “Appurtenances”).

 

The Land, Improvements and Appurtenances are referred to collectively in this Agreement as the “Premises”.

 

(d) Intangibles.  The following intangible personal property (collectively, the “Intangibles”):

 

(i) all licenses, authorizations, approvals, permits and certificates of occupancy issued by any governmental authority and relating to the ownership, use, operation or occupancy of the Premises (the “Permits”);

 

  

  

  

 

(ii) all currently effective warranties and guaranties given by any contractor, supplier or manufacturer of any Improvements, or of any work performed on any Improvements (the “Warranties”).

 

The Premises and Intangibles are referred to collectively as the “Property”.

 

	
2.  

	
TITLE DEED

 

Said Premises is to be conveyed by a good and sufficient quitclaim deed, with quitclaim covenants, running to the Buyer, or to the nominee or assignee designated by the Buyer, and said deed shall convey a good and clear record and marketable title thereto such as will be insured by a title company licensed in the Commonwealth of Massachusetts at the standard rate, free from encumbrances, subject only to the Permitted Exceptions (defined below).

 

	
3.  

	
PURCHASE PRICE

 

The agreed purchase price (“Purchase Price”) for said Property is Four Million Two Hundred Seventy-Five Thousand Dollars ($4,275,000), of which

 

(a) $150,000 (“Deposit”) has been paid by Buyer to Seller prior to the Effective Date.  Seller acknowledges receipt of the Deposit.  The “Effective Date” means the last date on which both parties have executed and received a fully executed duplicate copy of this Agreement.

 

(b) $4,125,000, subject to the adjustments and credits provided in this Agreement, shall be paid by Buyer at Closing by wire transfer or by bank or title company check.

 

	
4.  

	
TIME FOR PERFORMANCE; DELIVERY OF DEED

 

(a) Provided Seller has complied with all of its obligations hereunder, closing (“Closing”) of title shall take place upon the date specified by Buyer upon not less than three (3) business days’ prior notice but not later than December 31, 2010 unless extended pursuant to subsection (b) below, at a location selected by Buyer and reasonably acceptable to Seller.  The date upon which the parties close title in accordance with this Agreement shall hereinafter be referred to as the “Closing Date”.

 

(b) Buyer may extend the Closing Date to a date on or before January 30, 2011 (“Extended Closing Date”), provided Buyer gives Seller written notice of such extension on or before December 21, 2010.  Unless the parties mutually agree by written agreement to further extend the Closing Date, Buyer shall not have the option to extend the Extended Closing Date beyond January 30, 2011.  If the parties do not close on or before the Extended Closing Date and such failure to close is not due to Seller’s breach of this Agreement, this Agreement shall be null and void and Seller shall have the right to retain the Deposit, and the existing lease dated February, 2006, by and between Seller (as landlord) and Buyer (as tenant) (“Existing Lease”), shall remain in full force and effect and Buyer shall have the right to submit a new offer to purchase the Premises after July 30, 2011 and shall not have the right to do so prior to such date.

 

  

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5.  

	
POSSESSION

 

Full possession of the Premises is to be delivered by Seller to Buyer at the time of Closing and the Existing Lease shall terminate.  Seller shall be entitled to pro-rated rent under the Existing Lease for any portion of the month in which the conveyance occurs, if such conveyance occurs on any date other than the first day of the month.

 

	
6.  

	
TITLE

 

Buyer has received a current Title Commitment for the Property dated November 16, 2010 (“Title Commitment”).  No matter which is added to the Title Commitment after its original issuance shall be a considered an acceptable encumbrance on the Property and Seller shall cause all of the following to be removed from the Title Commitment at or prior to Closing any deeds of trust or mortgages; judgments; mechanics’ and materialmen’s liens; tax liens; liens, encumbrances; and all exceptions, conditions and requirements described in Schedule B-Section 1 of the Title Commitment.

 

	
7.  

	
USE OF MONEY TO CLEAR TITLE

 

To enable Seller to make conveyance as herein provided, Seller may, at the time of delivery of the deed, use the purchase money or any portion thereof to clear the title of any or all encumbrances or interests, provided that all instruments so procured are recorded simultaneously with the delivery of said deed or, in the case of institutional mortgages, arrangements for subsequent recording are made in accordance with customary conveyancing practice.

 

	
8.  

	
ACCEPTANCE OF DEED

 

The acceptance of a deed by the Buyer or its nominee as the case may be, shall be deemed to be a full performance and discharge of every agreement and obligation herein contained or expressed, except for those obligations expressly stated to survive the termination of this Agreement or to be performed after the delivery of said deed.

 

	
9.  

	
ADJUSTMENTS

 

It is acknowledged by the parties that the Existing Lease is a triple net lease.  As a result, Buyer currently pays all water, sewer, use charges and real estate taxes for the Premises and there shall be no prorations for such expenses at Closing.  Prorations for rent shall be in accordance with Section 5 hereof.

 

	
10.  

	
BROKER

 

Seller represents and warrants to Buyer that Seller has had no dealings, negotiations or communications with any broker or other intermediary in connection with this Agreement or the sale of the Property.  Buyer represents and warrants to Seller that Buyer has had no dealings, negotiations or communications with any broker or other intermediary in connection with this Agreement or the sale of the Property.  In the event that any claim is asserted by any person, firm or corporation, whether broker or otherwise, claiming a commission and/or finder’s fee with respect to the sale of the Property resulting from any act, representation or promise of Seller, Seller shall indemnify and save harmless Buyer from any such claim.  In the event any claim is asserted by any person, firm or corporation, whether broker or otherwise, claiming a commission and/or finder’s fee with respect to the sale of the Assets resulting from any act, representation or promise of Buyer, Buyer shall indemnify and save harmless Seller from any such claim.

 

  

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11.  

	
REPRESENTATIONS AND WARRANTIES

 

(a) Representations and Warranties of Seller.  In order to induce Buyer to enter into this Agreement and with full knowledge that Buyer is relying thereon, Seller hereby warrants and represents to Buyer as follows:

 

(i) Power to Perform.  This Agreement is duly authorized, executed and delivered by Seller, constitutes the legal and valid binding obligation of Seller, and does not violate any provision of any agreement or judicial order to which Seller is a party or to which it is subject.  All documents executed by Seller which are to be delivered to Buyer at the Closing will be duly authorized, executed and delivered by Seller, and will not violate any provisions of any agreement or judicial order to which Seller is a party or to which it is subject.

 

(ii) Proceedings, Bankruptcy.

 

(A)           There has not been filed by or against Seller a petition in bankruptcy or insolvency proceedings or for reorganization or for the appointment of a receiver or trustee, under state or Federal law.

 

(B)           Seller has not made an assignment for the benefit of creditors or filed a petition for an arrangement or entered into an arrangement with creditors which petition, proceedings, assignment, or arrangement was not dismissed by final, unappealable order of the court or body having jurisdiction over the matter.

 

(C)           Seller is not insolvent, nor has Seller admitted in writing the inability to pay its debts as they become due.

 

(iii) Contracts.  There are not now, nor will there be on the Closing Date, any contracts or agreements, written or oral, to which Seller is a party which affect the Premises.

 

(iv) Assessed Valuation.  To Seller’s knowledge, there is no proceeding pending for the adjustment of the assessed valuation of all or any portion of the Premises; there is no abatement in effect with respect to the real estate taxes.

 

(v) Assessments.  To Seller’s knowledge, there are not now presently pending any special assessments with respect to any portion of the Premises, and Seller has received no notice of, or become aware of any special assessment being contemplated.

 

  

-4-

  

 

(vi) Condemnation.  To Seller’s actual knowledge, there is no condemnation proceeding with regard to the Premises and Seller does not know of any proposed condemnation proceeding with regard to all or any portion of the Premises.

 

(vii) Litigation.  To the best of Seller’s knowledge, there is not now any action, proceeding, litigation or investigation pending or, to the best of Seller’s knowledge, threatened against Seller or the Premises, or affect the ability of Seller to perform its obligation under this Agreement, or which questions the validity or enforceability of this Agreement.

 

(viii) Foreign Person.  Seller is not a foreign person within the meaning of Section 1445 of the Internal Revenue Code.

 

(ix) Leases.  As of the Effective Date except for the Existing Lease, there are and as of the Closing Date the Premises will be subject to no other leases, licenses, claims or rights to possession in any party the Premises shall be delivered to Buyer free of all leases, licenses or other rights of possession claiming through Seller and on the Closing Date.

 

(x) Other Agreements.  There are no rights, options, or other agreements of any kind created by or through Seller to purchase or otherwise acquire or sell or otherwise dispose of any of the Property.

 

(xi) Separately Subdivided Parcel.  The Premises constitutes a separately subdivided parcel and is assessed for real estate tax purposes separate and distinct from all other real property and is not treated as part of any other real property for title, zoning or building purposes.

 

(xii) Boundary Matters.  To Seller’s actual knowledge, there are no encroachments onto, overlaps, boundary line disputes or other similar matters with respect to the Premises, nor do any of the Improvements encroach upon any adjacent property or any easement or right-of-way except as set forth on the survey delivered by Seller to Buyer.

 

(xiii) Service Contracts.  There are no management, service, equipment, supply, maintenance or concession agreements entered into by Seller with respect to or affecting the Property.

 

(xiv) Equipment Leases.  Seller has not entered into any lease agreement for the rental of furniture, fixtures or equipment in connection with the use or operation of the Property.

 

(b) Representations and Warranties of Buyer.  In order to induce Seller to enter into this Agreement, Buyer hereby warrants and represents to Seller as follows:  this Agreement is duly authorized, executed and delivered by Buyer, constitutes the legal and valid binding obligation of Buyer, and does not violate any provision of any agreement or judicial order to which Buyer is a party or to which it is subject.  All documents executed by Buyer which are to be delivered to Seller at the Closing will be duly authorized, executed and delivered by Buyer, and will not violate any provisions of any agreement or judicial order to which Buyer is a party or to which it is subject. 

 

  

-5-

  

 

(c) Representations and Warranties to Survive Closing.  Each of the representations and warranties of the respective parties contained herein or made in writing pursuant to this Agreement, shall be true and correct as of the Effective Date and as of the Closing Date, shall be deemed to be material and shall survive the execution and delivery of this Agreement and Closing for a period of one (1) year after the Closing Date.  All statements contained in any certificate or other instrument delivered at any time by or on behalf of Seller in conjunction with the transaction contemplated hereby shall constitute representations and warranties.

 

	
12.  

	
RESIDENTIAL APPROVALS.

 

Seller shall use its commercially reasonable efforts to obtain  all permits and approvals and relief, including but not limited to, state, county, regional and municipal governmental approvals and permits necessary or required to create on a portion of the Property up to three residential lots in the location and size as shown on Exhibit D (“Lots”), attached hereto and made a part hereof, pursuant to an Approvals Not Required Plan (“ANR Plan”) and all applicable appeal periods with respect to such approvals have expired without any appeal thereto having been taken (the “Approvals”).  Seller shall make application for such Approvals within sixty (60) days after the Closing Date.  The Approvals shall be obtained at Seller’s sole cost and expense and Buyer shall reasonably cooperate by executing applications and plans as necessary to obtain such Approvals.  If Seller has not obtained the Approvals as set forth herein within ninety (90) days after the Closing Date, Buyer shall retain the portion of the Property intended to be subdivided from the Property with no adjustment to Purchase Price or payment of any kind and Seller shall have no rights or interests in the Property or the Approvals.

 

Seller shall not increase the outer perimeter of the three Lots as shown on Exhibit D nor shall the Lots be relocated to any other portion of the Property.  It shall be Seller’s obligation to create no new non-conformity or increase an existing nonconformity with the Property by seeking and obtaining the Approvals or by the creation of the Lots.

 

Subject to the above, promptly after Seller obtaining the Approvals, Buyer shall convey the Lots back to Buyer by quitclaim deed, with quitclaim covenants, and with no additional representations or warranties by Buyer.  Any transfer tax or other taxes, recording costs, plan recording costs or other expenses related to such conveyance shall be paid solely by Seller.  Seller acknowledges that Buyer intends to obtain bond financing, a portion of the proceeds of which will be allocated to the acquisition of the Property.  Buyer’s lender has certain requirements that must be satisfied by Buyer before lender will permit the Lots to be released from the lien of the mortgage encumbering the Property and securing the financing.  If Buyer is unable to satisfy all of  these requirements, and as a result, Buyer’s lender will not release the Lots from the lien of the encumbering mortgage or permit the reconveyance of the Lots to Seller, Seller shall release any and all claims to the Property or the right to reconveyance of the Lots and shall release, indemnify and hold harmless, Buyer from any liability hereunder and Buyer shall retain the entire Property, including the Lots with no adjustment to Purchase Price or payment of any kind. and Seller shall have no rights or interests in the Property.

 

  

-6-

  

 

At Closing, Seller shall provide to Buyer for the benefit of and to be relied upon by Buyer’s lender, a release from Seller indicating Seller has no claims to the remainder of the Property, such release to be in form and substance acceptable to Buyer’s lender.

 

This Section 12 shall survive Closing..

 

	
13.  

	
PROVISIONS WITH RESPECT TO CLOSING.

 

(a) Period Prior to Closing.

 

(i) Affirmative Covenants.  Between the date of this Agreement and the Closing Date, Seller agrees to:

 

(A)           Deliver to Buyer, promptly after receipt by Seller, copies of all notices of violation issued by any board, bureau, commission, department or body of any municipal, county, state or Federal government unit with respect to the Property received by Seller after the date of this Agreement;

 

(B)           advise Buyer promptly of any litigation, arbitration or other judicial or administrative proceeding which concerns or affect the Property of which Seller becomes aware;

 

(C)           cure any violation of which Seller receives notice;

 

(D)           comply with the requirements of all Permits and Warranties; and

 

(E)           in the event Seller becomes aware that any representation or warranty made by Seller in this Agreement will not be true and correct on the Closing Date, as if made at and as of the Closing Date, give prompt written notice thereof to Buyer, which notice shall include all information related thereto that is in Seller’s possession or control.

 

(ii) Negative Covenants.  Between the date of this Agreement and the Closing Date, Seller agrees that, without Buyer’s prior written consent, Seller will not:

 

(A)           grant, create, assume or permit to be created any mortgage, lien, encumbrance, lease, easement, covenant, condition, right-of-way or restriction upon the Premises or take or permit any action adversely affecting the title to the Premises as it exists on the date of this Agreement;

 

(B)           or enter into any new service contract (including, without limitation, any management, service, equipment, supply, maintenance or concession agreement) or equipment lease; or

 

(C)           make any alterations to the Premises.

 

  

-7-

  

 

(b) At Closing:

 

(i) Seller Deliveries.  Seller shall deliver or cause to be delivered the following:

 

(A)           a quitclaim deed with quitclaim covenants duly executed and acknowledged by Seller, in proper form for recording, subject only to the Permitted Exceptions, to the extent valid and subsisting;

 

(B)           an assignment conveying the Intangibles, free and clear of all liens, security interests and encumbrances, and in the form attached to this Agreement as Exhibit C;

 

(C)           an affidavit, in accordance with the Foreign Investment in Real Property Tax Act, in the form attached to this Agreement as Exhibit E;

 

(D)           an affidavit to the Title Company of the type customarily provided by sellers of real property to induce title companies to insure over certain “standard” or “preprinted” exceptions to title;

 

(E)           executed originals of all Permits, and Warranties; and

 

(F)           such other documents as reasonably requested of Seller by Buyer, the Title Company or Buyer’s lender.

 

(ii) Possession.  Possession of the Property shall be delivered by Seller to Buyer at Closing.

 

(iii) Deposit.  The Deposit shall be credited against the Purchase Price.

 

(iv) Buyer’s Deliveries.  Buyer shall deliver or cause to be delivered to Seller the following:

 

(A)           the balance of the Purchase Price; and

 

(B)           such other documents as may be reasonably required to consummate the transactions contemplated by this Agreement.

 

(v) Closing Expenses.

 

(A)           Buyer and Seller shall each pay all recording fees incurred with respect to the transactions contemplated by this Agreement in accordance with the custom for similar transactions for the jurisdiction in which the Premises is located.

 

(B)           Buyer shall pay the costs of the Title Commitment, title policy and all endorsements thereto, the cost of the Survey, and all costs of any appraisal, engineering and environmental reports obtained by Buyer.

  

-8-

  

 

(C)           Seller and Buyer shall each pay one-half of the transfer taxes applicable to this transaction.

 

(D)           Seller and Buyer shall each be responsible for paying their respective attorneys’ fees and costs.

 

(vi) Prepayment Penalty.  Seller and Buyer shall each pay one-half of the amount of the prepayment penalty charged pursuant to Seller’s current mortgage loan with Amalgamated Bank which is being satisfied and released in connection with the sale of this Property to Buyer.

 

	
14.  

	
CONDEMNATION.

 

If after the Effective Date, and on or prior to the Closing Date, all or any material portion (more than 5% in land area or materially impacts access to the Premises) of the Premises is taken by eminent domain or a notice of any eminent domain proceeding with respect to a material portion of the Premises or any part thereof is received by Seller, Seller shall immediately give written notice thereof with specificity to Buyer.  Buyer shall complete the purchase of the Premises under this Agreement, with no deduction/reduction in the Purchase Price except at the Closing Seller shall pay, assign and transfer to Buyer all net proceeds from such proceedings theretofore received by Seller with regard to the Premises and all rights Seller has to any future proceeds of such eminent domain proceedings with regard to the Premises (after deducting Seller’s reasonable, actual out-of-pocket costs incurred in connection therewith).

 

	
15.  

	
CASUALTY

 

If at any time prior to Closing any portion of the Property is destroyed or damaged as a result of fire or any other casualty whatsoever, Seller shall, within three (3) days thereafter, give written notice to Buyer but Buyer shall be required purchase the Property.  Buyer shall have the right, to participate in and approve any adjustment of any insurance claims, the proceeds of any insurance policies with respect to the Property paid between the date of this Agreement and the Closing shall be paid or credited to Buyer at time of Closing, unless the Property is restored prior to Closing, and (c) all unpaid claims and rights in connection with losses shall be assigned to Buyer at Closing without in any manner affecting the Purchase Price.

 

	
16.  

	
CONDITIONS PRECEDENT.

 

(a) Conditions to Buyer’s Obligations To Purchase.  Buyer’s obligation to purchase the Premises is conditioned upon the satisfaction (or Buyer’s written waiver) on or prior to the Closing Date of the following conditions:

 

(i) The Title Company shall have issued or shall have committed to issue, upon payment of the applicable premium therefor, an ALTA Owner’s Policy of Title Insurance with respect to the Premises showing title to the Premises vested in Buyer, subject only to the Permitted Exceptions.

 

  

-9-

  

 

(ii) Each of the documents required to be delivered by Seller pursuant to this Agreement shall have been delivered as provided therein, and Seller shall not otherwise be in default under this Agreement.

 

(iii) Seller’s representations and warranties shall be true and correct in all material respects as of the Closing Date as if such representations and warranties were made at and as of the Closing Date.

 

(iv) Seller shall have performed, observed and complied with all covenants, agreements and conditions required by this Agreement to be performed, observed and complied with prior to or as of the Closing.

 

	
17.  

	
DEFAULT

 

(a) Seller Default.

 

(i) If the sale of the Property is not consummated because of a material default under this Agreement on the part of the Seller, Buyer may terminate this Agreement by written notice of termination to Seller on or before the Closing Date, whereupon the Deposit shall be paid to Buyer, this Agreement shall become null and void and of no further force or effect and neither Seller nor Buyer shall have any further liability or obligation to the other under this Agreement, except for those obligations expressly stated to survive the termination of this Agreement, or

 

(ii) Buyer shall also have the right to sue for specific performance of this Agreement.

 

(b) Buyer Default.

 

(i) If the sale of the Property is not consummated because of a default under this Agreement on the part of Buyer, Seller shall be entitled to terminate this Agreement by written notice of termination to Buyer on the Closing Date, whereupon, as Seller’s sole and exclusive remedy, the Deposit shall be retained by Seller as assessed and liquidated damages, and this Agreement shall become null and void and of no further force or effect and neither Seller nor Buyer shall have any further liability or obligation to the other under this Agreement, except for those obligations expressly stated to survive the termination of this Agreement.  Buyer shall also be prohibited from submitting a new offer for purchase until July 31, 2011.

 

	
18.  

	
NOTICES

 

Any notices required or permitted to be given under this Agreement shall be given in writing and shall be delivered (a) in person, (b) by a commercial overnight courier that guarantees next day delivery and provides a receipt, or (c) by legible facsimile (followed by hard copy sent concurrently with such facsimile in accordance with preceding subsections (a) or (b)), or (d) mailed by certified mail, return receipt requested and such notices shall be addressed to the parties  at the addresses set forth in paragraph 1 of the Agreement, in the case of Seller with a copy to,

 

  

-10-

  

 

WM Realty Management LLC

46 Baldwin Farms Road

Greenwich, CT  06831

Facsimile No.:

 

with a copy to:

 

Patricia Finnegan Gates, Esq.

Mountain, Dearborn & Whiting LLP

370 Main Street

Worcester, MA 01608

Facsimile No.: 508.755.6640

 

and in the case of Buyer with a required copy to (but which shall not constitute notice to Buyer):

 

Christine S. Kimmel, Esq.

Pepper Hamilton LLP

899 Cassatt Road

400 Berwyn Park

Berwyn, PA  19312

Facsimile No.: 610.640.7835

 

	
19.  

	
MISCELLANEOUS.

 

(a) Time of Essence.  Time is of the essence on each and every provisions of this Agreement on which time is an element.

 

(b) Governmental Filings.  If either party is required to make any filing, submission or report to any governmental authority in connection with the transactions contemplated by this Agreement, the party upon which such requirement is imposed shall make such filing, submission or report.

 

(c) Interpretation of Agreement.  The headings and captions in this Agreement are inserted for convenience of reference only and in no way define, describe or limit the scope or intent of this Agreement or any of the provisions hereof.  Where the context so requires, the use of the singular shall include the plural and vice versa and the use of the masculine shall include the feminine and the neuter.  This Agreement shall be construed reasonably to carry out its intent, without presumption against or in favor of either party.

 

(d) Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Massachusetts.

 

(e) The Seller shall comply with all laws and regulations regarding the transfer of real estate in the jurisdiction, including payment of all transfer taxes and recording fees imposed upon Seller.  If applicable, Seller shall provide the settlement agent with a signed, completed W-9 form, including Seller’s forwarding address and an allocation of the gross proceeds of the sale, all for the purpose of complying with the reporting requirements of 1521(a) and 1521(b) of the Tax Reform Act of l986.  The Seller agrees to sign all standard and customary documents as are reasonably required by the lender or lender’s attorney in order to complete the transaction.

 

  

-11-

  

 

(f) Buyer and Seller hereby disclose their social security/taxpayer I.D. numbers for the purpose of facilitating the reporting to the I.R.S. the sale of the Premises and any interest earned by either of the parties on the deposit, as required by law:

 

Seller’s Taxpayer I.D. number 20-35-00189

 

Buyer’s Taxpayer I.D. number 27-007112

 

(g) Counterparts.  This Agreement may be executed in two or more counterparts, by facsimile or electronically, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

 

(h) Liability Of Trustee, Shareholder, Beneficiary, Etc.  If the Seller or Buyer executes this agreement in a representative or fiduciary capacity, only the principal or the estate represented shall be bound, and neither the Seller or Buyer so executing, nor any shareholder or beneficiary of any trust, shall be personally liable for any obligation, express or implied, hereunder.

 

(i) Assignment; Successors and Assigns.  Upon prior written notice to Seller, Buyer may assign its interest under this Agreement, without the prior written consent of Seller to any party which either controls, is controlled by or is under common control with the Buyer.  This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

 

(j) Entire Agreement; Requirement for Writing.  This Agreement and the Exhibits attached to this Agreement contain the final and entire agreement of Buyer and Seller with respect to the sale and purchase of the Premises and are intended to be an integration of all prior negotiations and understandings.  Neither Buyer nor Seller shall be bound by any covenants, agreements, statements, representations or warranties, oral or written, not contained in this Agreement.  No change or modification to this Agreement shall be valid unless the same is in writing and signed by the parties to this Agreement.  No waiver of any of the provisions of this Agreement shall be valid unless the same is in writing and is signed by the party against which it is sought to be enforced.

 

(k) Severability.  If any provision of this Agreement, or the application thereof to any person, place or circumstance, shall be held by a court of competent jurisdiction to be invalid, unenforceable or void, the remainder of this Agreement and such provisions as applied to other persons, places and circumstances shall remain in full force and effect.

 

(l) Automatic Extension.  In the event that the date for performance of any duty or obligation, exercise of any right or option or giving of any notice shall occur upon a Saturday, Sunday or legal holiday, the due date for such performance, exercise or giving of notice shall be automatically extended to the next succeeding Business Day.  “Business Day” shall mean any day other than a Saturday, a Sunday, or a federal holiday recognized by the Federal Reserve Bank of Massachusetts.

 

  

-12-

  

 

(m) Further Assurances.  Each party shall, whenever and as often as it shall be requested to do so by the other party, execute, acknowledge and deliver, or cause to be executed, acknowledged and delivered, any and all such other documents and do any and all other acts as may be necessary to carry out the intent and purpose of this Agreement.

 

(n) WAIVER OF TRIAL BY JURY. EACH PARTY HEREBY WAIVES, IRREVOCABLY AND UNCONDITIONALLY, TRIAL BY JURY IN ANY ACTION BROUGHT ON, UNDER OR BY VIRTUE OF OR RELATING IN ANY WAY TO THIS AGREEMENT OR ANY OF THE DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT, THE PREMISES, OR ANY CLAIMS, DEFENSES, RIGHTS OF SET-OFF OR OTHER ACTIONS PERTAINING HERETO OR TO ANY OF THE FOREGOING.

 

(o) No Recording.  Neither this Agreement nor any memorandum or short form thereof may be recorded by either party.

 

(p) Drafts not an Offer to Enter into a Legally Binding Contract.  The submission of a draft of this Agreement by one party to another is not intended by either party to be an offer to enter into a legally binding contract with respect to the purchase and sale of the Premises.  The parties shall be legally bound with respect to the purchase and sale of the Premises pursuant to the terms of this Agreement only if and when Seller and Buyer have fully executed and delivered to each other a counterpart of this Agreement.

 

 

 

 

 

 

[REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]

 

  

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

	WM REALTY MANAGEMENT, LLC, 	 	RANOR, INC., a Delaware corporation,	 
	a Massachusetts limited liability company	 	 	 	 
	 	 	 	 	 
	By:	
/s/ Andrew Levy

	 	By:	
/s/ Stanley Youtt

	 
	
Name:

	
Andrew Levy

	 	
Name:

	
Stanley Youtt

	 
	 	 	 	 	 	 
	
Date:

	

December 20, 2010

	 	
Date:

	
December 20, 2010

	 

 

  

-14-

  

EXHIBIT A

 

Legal Description

 

 

  

-15-

  

 

 

  

-16-

  

 

 

  

-17-

  

 

 

  

-18-

  

EXHIBIT B

 

ANR Plan

 

 

  

-19-

  

EXHIBIT C

 

Assignment of Intangible Property

 

ASSIGNMENT OF INTANGIBLES

 

THIS ASSIGNMENT OF INTANGIBLES (the “Assignment”) is made as of the ________ day of,2010, by ___________________________________________, a ______________________ (the “Assignor”), in favor of _____________________________, a _____________________ (the “Assignee”).

 

WITNESSETH:

 

Assignor and Assignee are parties to Purchase and Sale Agreement dated_____________ (the “Agreement”) pursuant to which Assignor agreed to sell and Assignee agreed to purchase certain property located in _____________________, _________________ County, Massachusetts (the “Premises”). This Assignment is being delivered pursuant to the Agreement.

 

NOW, THEREFORE, for good and valuable consideration received by Assignor, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Assignor hereby sells, assigns and transfers to Assignee all of the following (collectively, the “Intangibles”):

 

(a)           all licenses, authorizations, approvals, permits and certificates of occupancy, if any, issued by any governmental authority and relating to the ownership, operation, maintenance, use or occupancy of the Premises;

 

(b)           all currently effective warranties or guaranties given by any contractor, supplier or manufacturer of (i) any personal property or fixture installed in or used in connection with the Premises, and (ii) any work performed on or improvements included in the Premises.

 

Assignor represents and warrants to Assignee that (a) Assignor is the absolute owner of the Intangibles, (b) the Intangibles are free and clear of all liens, charges, encumbrances and security interests, and (c) Assignor has full right, power and authority to sell the Intangibles and to make this Assignment.

 

This Assignment shall inure to the benefit of Assignee, its successors and assigns and shall be binding upon, Assignor, its successors and assigns.

 

  

-20-

  

IN WITNESS WHEREOF, Assignor has executed this Assignment on the day and year first above written.

 

	 	ASSIGNOR:	 
	 	 	 	 
	
 

	
By: 

	 	 
	 	Name:	 	 
	 	Title: 	 	 
	 	 	 	 

 

  

-21-

  

EXHIBIT D

 

Subdivision Approvals

 

  

-22-

  

 

EXHIBIT E

 

Foreign Investment in Real Property Tax Act

 

ENTITY TRANSFER CERTIFICATION

 

Section 1445 of the Internal Revenue Code provides that a transferee of a United States real property interest must withhold tax if the transferor is a foreign person. To inform _________________________ (the “Buyer”) that withholding of tax is not required upon the disposition of United States real property interests by __________________________ (the “Seller”), Seller hereby certifies the following:

 

	
1.  

	
SELLER IS NOT A FOREIGN CORPORATION, FOREIGN PARTNERSHIP, FOREIGN TRUST, OR FOREIGN ESTATE, AS THOSE TERMS ARE DEFINED IN THE INTERNAL REVENUE CODE AND INCOME TAX REGULATIONS.

 

	
2.  

	
SELLER’S EMPLOYER IDENTIFICATION NUMBER IS __________________________.

 

	
3.  

	
SELLER’S ADDRESS IS:

 

                                                 ________________________________

 ________________________________

 ________________________________

 ________________________________

 

Seller understands that this certification may be disclosed to the Internal Revenue Service by Buyer and that any false statement made by Seller and contained herein could be punished by fine, imprisonment or both.

 

Under penalties of perjury, the undersigned individual signing this document on behalf of Seller declares that he/she has examined this certification and to the best of his/her knowledge and belief, it is true, correct and complete. The undersigned further declares that he/she has authority to sign this document on behalf of Seller.

 

WITNESS:                                                                           _______________________________________

 

__________________________                                  By: ____________________________________

 

Print Name: ________________                                 Name: __________________________________

 

                                                                                            Title: ____________________________________

 

Date: _______________________

 

  

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