Document:

Exhibit 10.17

Exhibit 10.17 

GERBER SCIENTIFIC, INC. 2003 EMPLOYEE STOCK
OPTION PLAN

AS AMENDED AND RESTATED AS OF FEBRUARY 22, 2007

ARTICLE 1. DEFINITIONS 

	 	 
	1.1          	Board shall
		mean the Board of Directors of the Company. 
	 
	1.2          	Bonus Shares 
		shall mean shares of Common Stock granted to a
		Participant under Article 8 of this Plan. 
	 
	1.3          	Business Combination 
		shall have the meaning ascribed to such term in
		Section 1.4 of this Plan. 
	 
	1.4          	Change in Control 
		shall mean: 

	 	 	 
	 	(i)	The acquisition by any individual,
		entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
		the Exchange Act) (a "Person") of beneficial ownership (within the
		meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more
		of the combined voting power of the Company's then outstanding voting
		securities; provided, however, that for purposes of this subsection (i),
		the following acquisitions shall not constitute a Change in Control:
		(1) any acquisition directly from the Company; (2) any acquisition by
		the Company; (3) any acquisition by any employee benefit plan (or
		related trust) sponsored or maintained by the Company; or (4) any
		acquisition by any corporation pursuant to a transaction which complies
		with clauses (1), (2) and (3) of subsection (iii) of this definition; or
		
	 
	 	(ii)	When individuals who, as of the date
		hereof, constitute the Board (the "Incumbent Board") cease for any
		reason to constitute at least a majority of the Board; provided,
		however, that any individual becoming a director subsequent to the date
		hereof whose election, or nomination for election by the Company's
		stockholders, was approved by a vote of at least a majority of the
		directors then comprising the Incumbent Board (either by a specific vote
		or by approval of the proxy statement of the Company in which such
		person is named as a nominee for director, without written objection to
		such nomination) shall be considered as though such individual were a
		member of the Incumbent Board, but excluding, for this purpose, any such
		individual whose initial assumption of office occurs as a result of an
		actual or threatened election contest with respect to the election or
		removal of directors or other actual or threatened solicitation of
		proxies or contests by or on behalf of a Person other than the Board; or
		
	 
	 	(iii)	Consummation of a reorganization,
		merger, share exchange or consolidation or sale or other disposition of
		all or substantially all of the assets of the Company (a "Business
		Combination"), in each case, unless following such Business Combination,
		(1) all or substantially all of the individuals and entities who were
		the beneficial owners, respectively, of the outstanding Common Stock and
		the outstanding voting securities of the Company entitled to vote
		generally in the election of directors (the "Outstanding Company Voting
		Securities") immediately prior to such Business Combination beneficially
		own, directly or indirectly, more than 60% of, respectively, the then
		outstanding shares of Common Stock and the combined voting power of the
		then outstanding voting securities entitled to vote generally in the
		election of directors, as the case may be, of the corporation resulting
		from such Business Combination (including, without limitation a
		corporation which as a result of such transaction owns the Company or
		all or substantially all of the Company's assets either directly or
		through one or more subsidiaries) in substantially the same proportions
		as their ownership, immediately prior to such Business Combination of
		the outstanding Common Stock and Outstanding Company Voting Securities,
		as the case may be, (2) no Person (excluding any corporation resulting
		from such Business Combination or any employee benefit plan (or related
		

 

 

	 	 	 
	 	 	trust) of the Company or such
		corporation resulting from the Business Combination) beneficially owns,
		directly or indirectly, 30% or more of, respectively, the then
		outstanding shares of common stock of the corporation resulting from
		such Business Combination or the combined voting power of the then
		outstanding voting securities of such corporation except to the extent
		that such ownership existed prior to the Business Combination, and (3)
		at least a majority of the members of the board of directors of the
		corporation resulting from such Business Combination were members of the
		Incumbent Board immediately prior to the time of the execution of the
		initial agreement, or of the action of the Board, providing for such
		Business Combination, or 
	 
	 	(iv)	Approval by the shareholders of the
		Company of a complete liquidation or dissolution of the Company. 
		

	 	 
	1.5          	Code shall
		mean the Internal Revenue Code of 1986, as amended. 
	 
	1.6          	Committee 
		shall mean the Management Development and Compensation Committee of the
		Board (or any other committee of the Board authorized by the Board to
		administer this Plan) which shall administer this Plan in accordance
		with the provisions of Article 5 of this Plan. 
	 
	1.7          	Common Stock 
		shall mean the common stock, $1.00 par value, of the
		Company. 
	 
	1.8          	Company 
		shall mean Gerber Scientific, Inc., its Subsidiaries and their
		successors and assigns. 
	 
	1.9          	Effective Date 
		shall have the meaning ascribed to such term in
		Section 2.2 of this Plan. 

	 	 
	1.10       	Employee 
		shall mean any employee of the Company or any of its Subsidiaries.
		
	 
	1.11       	Exchange Act 
		shall mean the Securities Exchange Act of 1934, as
		amended. 
	 
	1.12       	Fair Market Value 
		shall mean, as applied to a specific date, the closing
		price for the Common Stock on the New York Stock Exchange Composite Tape
		on such date as reported by The Wall Street Journal or such other source
		as the Committee deems reliable, or if no Common Stock was traded on
		such date, on the next preceding day on which Common Stock was so
		traded. 
	 
	1.13       	Grant shall
		mean, individually or collectively, a grant under this Plan of
		Nonqualified Stock Options, Incentive Stock Options, Restricted Shares,
		or Bonus Shares. 
	 
	1.14       	Grant Agreement 
		shall mean the written agreement evidencing the grant of
		Options, Restricted Shares, and/or Bonus Shares entered into between a
		Participant and the Company pursuant to this Plan. 
	 
	1.15       	Grant Date 
		shall mean, with respect to a particular Grant, the date as of which
		such Grant is granted by the Committee pursuant to this Plan. 
		
	 
	1.16       	Incentive Stock Option 
		shall mean any Option granted under this Plan which the
		Committee intends (at the time it is granted) to be an Incentive Stock
		Option within the meaning of Section 422 of the Code. 
	 
	1.17       	Insider Participant 
		shall mean any individual who is selected by the
		Committee to receive Grants under the Plan and who is subject to the
		requirements of Section 16(a) of the Exchange Act, and the rules and
		regulations thereunder. 
	 
	1.18       	Noninsider Participant 
		shall mean any person who is selected by the Committee to
		receive Grants under the Plan who is not an Insider Participant. 
		
	 
	1.19       	Nonqualified Option 
		shall mean any Option granted under this Plan which is
		not an Incentive Stock Option. 

 

 

	 	 
	1.20       	Option 
		shall mean the right of a Participant to purchase shares of Common Stock
		in accordance with the provisions of this Plan and such term shall
		include Nonqualified Options and Incentive Stock Options, unless
		otherwise indicated. 
	 
	1.21       	Option Period 
		shall have the meaning ascribed to such term in
		Section 6.4 of this Plan. 
	 
	1.22       	Option Price 
		shall mean the price per share of Common Stock to be paid
		by a Participant upon exercise of an Option, as stated in the Grant
		Agreement. 
	 
	1.23       	Participant 
		shall mean any Employee who satisfies the eligibility
		requirements of Article 3 of this Plan and who is selected by the
		Committee to receive a Grant under this Plan. 
	 
	1.24       	Permanent Disability 
		shall mean "permanent and total disability" as provided
		in Section 22(e)(3) of the Code. 
	 
	1.25       	Plan shall
		mean the Gerber Scientific, Inc. 2003 Employee Stock Option Plan and any
		amendments thereto. 
	 
	1.26       	Restricted Shares 
		shall mean shares of Common Stock granted to a
		Participant under Article 7 of this Plan that are subject to
		restrictions and to a risk of forfeiture. 
	 
	1.27       	Retirement 
		shall mean termination of employment, for reasons other than Permanent
		Disability or death: (1) at any time on or after the Participant's
		normal retirement age pursuant to the Gerber Scientific, Inc. and
		Participating Subsidiaries Pension Plan or any successor thereto (the "Pension Plan"), or (2) if the Company does not maintain a pension or
		retirement plan, at any time on or after the Participant's sixty-fifth
		birthday. 
	 
	1.28       	Subsidiary 
		shall mean any corporation or other business entity in which the Company
		directly or indirectly owns fifty percent or more of the outstanding
		voting stock or other ownership interest. 

ARTICLE 2. PURPOSE; EFFECTIVE DATE

	 	 
	2.1          	Purpose. 
		The purpose of this Plan is to offer as an additional incentive to the
		officers and other key Employees who are the most responsible for the
		growth and success of the Company and its Subsidiaries, the opportunity
		to increase their proprietary interest in the Company under conditions
		which will encourage their continued employment in the service of the
		Company or its Subsidiaries and to recognize and reward their
		contribution to creating shareholder value. 
	 
	2.2          	Effective Date. 
		The Plan shall become effective upon Board adoption of
		the Plan (the "Effective Date"), provided that the Plan is approved by
		the shareholders of the Company within twelve (12) months before or
		after the date of such adoption. No Incentive Stock Options,
		Nonqualified Options, Restricted Shares, or Bonus Shares shall be
		granted under this Plan unless and until the Plan is approved by
		shareholders nor after the expiration of ten (10) years from the date
		the Plan is adopted by the Board. 

ARTICLE 3. ELIGIBILITY 

	 	 
	3.1          	Persons Eligible. 
		Grants may be made only to Employees who are key
		Employees (which term shall be deemed to include officers) who on the
		grant date (i) are employed by the Company or any of its Subsidiaries
		and (ii) have managerial, supervisory, professional, scientific,
		engineering or similar responsibilities. A Director of the Company or
		any Subsidiary who is not also an Employee shall not be 

 

 

	 	 
	 	eligible to receive a Grant. During the
		term of this Plan, Grants may be made to eligible Employees whether or
		not they hold or have held Grants under this Plan or Options under
		previously adopted plans. 

	 	 	 
	 	 	The Committee shall determine, in its
		sole discretion, who is a key Employee and its decision shall be final,
		binding and conclusive. 

ARTICLE 4. COMMON STOCK COVERED BY THE PLAN

	 	 
	4.1          	Plan Maximums. 
		Subject to adjustment as provided in Section 4.4 of this
		Plan, the aggregate number of shares of Common Stock with respect to
		which Options, Restricted Shares and Bonus Shares may be granted under
		this Plan shall be 900,000 shares and the aggregate number of Restricted
		Shares and/or Bonus Shares which may be granted under this Plan shall be
		450,000. In addition, if any Restricted Share, Bonus Share or Option
		expires, is terminated unexercised, is forfeited, or is surrendered or
		is otherwise withheld to pay the exercise price of Options or other
		awards issued under this Plan or to satisfy the tax withholding
		obligations under these awards, then such Restricted Share, Bonus Share
		and/or the number of shares of Common Stock covered by such Option shall
		again be available for grant under this Plan. 
	 
	4.2          	Limitation on Grants Per Participant.
		The maximum number of shares of Common Stock
		with respect to which Options, Restricted Shares and Bonus Shares may be
		granted under this Plan to any Participant shall not exceed 120,000
		shares in any two-year period, subject to adjustment as provided in
		Section 4.4 hereunder. 
	 
	4.3          	Source of Shares. 
		The shares to be issued under this Plan shall be
		authorized but unissued shares of Common Stock. 
	 
	4.4          	Adjustments to Grants. 
		In the event of any merger, consolidation, stock split,
		stock dividend, reverse stock split, recapitalization, combination,
		exchange of shares, liquidation, split-up, split-off or other similar
		change in capitalization, or any distribution to stockholders, other
		than regular cash dividends, or any other event for which the Committee
		believes an adjustment is appropriate, the Committee shall make a
		proportionate adjustment in the number, price and/or kind of securities
		authorized by the Plan (including a proportionate adjustment to the
		maximum number of Restricted Shares and Bonus Shares that may be granted
		under the Plan and the maximum number of shares of Common Stock with
		respect to which Options, Restricted Shares and/or Bonus Shares may be
		granted under the Plan to any participant in any two year period) and in
		any outstanding Options and/or Restricted Shares theretofore granted
		under the Plan, provided, however, that any fractional shares resulting
		from any such adjustment shall be eliminated. Upon the occurrence of any
		such event, the Committee may also make such other adjustments as it
		shall consider appropriate to preserve the benefits or potential
		benefits intended to be made available to Participants. Options granted
		pursuant to the Plan and described as Incentive Stock Options shall not
		be adjusted in a manner that causes the Options to fail to continue to
		qualify as Incentive Stock Options without the Participant's consent.
		The determination by the Committee as to the terms of any of the
		foregoing adjustments shall be conclusive and binding. 
	 
	 	Notwithstanding the foregoing, the
		issuance by the Company of shares of stock of any class, or securities
		convertible into shares of stock of any class, for cash or property, or
		for labor or services rendered, either upon direct sale or upon the
		exercise of rights or warrants to subscribe therefore, or upon
		conversion of shares or obligations of the Company convertible into such
		shares or other securities, shall not affect, and no adjustment by
		reason thereof shall be made with respect to, outstanding Options or
		Restricted Shares. 

 

ARTICLE 5. ADMINISTRATION OF THE PLAN

	 	 
	5.1          	Committee. 
		The Plan shall be administered by the Committee. 
	 
	5.2          	Powers of the Committee. 
		The Committee may interpret this Plan, prescribe, amend,
		and rescind any rules and regulations necessary or appropriate for the
		administration of this Plan, and make such other determinations under,
		and interpretations of, this Plan, and take such other action, as it
		deems necessary or advisable. Any interpretation, determination or other
		action made or taken by the Committee shall be final, binding and
		conclusive upon all parties. 
	 
	5.3          	Action by the Committee. 
		A majority of the members of the Committee shall
		constitute a quorum. All determinations of the Committee shall be made
		by a majority of its members. Any decision or determination reduced to
		writing and signed by all of the members shall be fully as effective as
		if it had been made by a majority vote at a meeting duly called and
		held. The Committee shall also have express authority to hold Committee
		meetings by means of conference telephone or similar communications
		equipment by which all persons participating in the meeting can hear
		each other. 
	 
	5.4          	Discretion to Determine Grants.
		Subject to the provisions of this Plan, the Committee shall have the
		authority in its sole discretion from time to time to: 

	 	 	 
	 	     (a)	determine and designate those key
		Employees to whom Grants are to be made; 
	 
	 	     (b)	authorize and make Grants; 
	 
	 	     (c)	determine the number of Options granted
		pursuant to any Grant Agreement and the number of shares of Common Stock
		subject to each Option, the Option Price thereof, and whether the
		Options covered thereby are Incentive Stock Options or Nonqualified
		Stock Options; provided, however, that repricing of Options shall not be
		permitted. For this purpose, a "repricing" means any of the following
		(or any other action that has the same effect as any of the following):
		(A) changing the terms of an Option to lower its Option Price; (B) any
		other action that is treated as a "repricing" under generally accepted
		accounting principles; and (C) canceling an Option at a time when its
		Option Price is equal to or greater than the Fair Market Value of the
		underlying Common Stock in exchange for another Option, restricted stock
		or other equity award, unless the cancellation and exchange occurs in
		connection with a Change in Control. Such cancellation and exchange
		would be considered a "repricing" regardless of whether it is treated as
		a "repricing" under generally accepted accounting principles and
		regardless of whether it is voluntary on the part of the Participant.
		
	 
	 	     (d)	determine the number of Restricted
		Shares granted to any Participant; 
	 
	 	     (e)	determine the number of Bonus Shares
		granted to any Participant; 
	 
	 	     (f)	determine the time or times when and the
		manner in which each Option shall be exercisable; 
	 
	 	     (g)	establish the criteria for the vesting
		and/or acceleration of the vesting of Grants; 
	 
	 	     (h)	determine the duration of the Option
		Period for each Option; 
	 
	 	     (i)	determine the terms, conditions and
		restrictions on Restricted Shares including terms and conditions
		relating to the disposition or transfer of such Restricted Shares and
		the forfeitability of such Restricted Shares; 
	 
	 	     (j)	determine the terms, conditions and
		restrictions, if any, on Bonus Shares; and 
	 
	 	     (k)	make all other determinations deemed
		necessary or advisable for the administration of this Plan. In making
		these determinations, the Committee may take into account the nature of
		the services rendered by respective Employees, their present and
		potential contributions to the success of the Company and such other
		factors as the Committee in its discretion shall deem relevant. 
		

 

 

	 	 
	 	The Committee may, in its discretion,
		treat all or any portion of any period during which a Participant is on
		military or on an approved leave of absence from the Company as a period
		of employment of such Participant by the Company, for purposes of
		accrual of his rights under his Grants. 

	 	 
	5.5          	Indemnification. 
		Current and past members of the Board or Committee shall
		be indemnified and held harmless by the Company against and from any and
		all loss, cost, liability or expense that may be imposed upon or
		reasonably incurred by such member in connection with or resulting from
		any claim, action, suit or proceeding to which such member may be or
		become a party or in which such member may be or become involved by
		reason of any action taken or failure to act under this Plan and against
		and from any and all amounts paid by such member in settlement thereof
		(with the Company's written approval) or paid by such member in
		satisfaction of a judgment in any such action, suit or proceeding,
		except a judgment in favor of the Company based upon a finding of such
		member's lack of good faith. Indemnification pursuant to this provision
		is subject to the condition that, upon the institution of any claim,
		action, suit or proceeding against such member, such member shall in
		writing give the Company an opportunity, at its own expense, to handle
		and defend the same before such member undertakes to handle and defend
		it on such member's behalf. The foregoing right of indemnification shall
		not be exclusive of any other right to which such member may be entitled
		as a matter of law or otherwise, or any power that the Company may have
		to indemnify or hold such member harmless. 
	 
	5.6          	Reliance. 
		Each member of the Board or of the Committee, and each officer and
		Employee of the Company, shall be fully justified in relying or acting
		in good faith upon any information furnished in connection with the
		administration of this Plan by any appropriate person or persons. In no
		event shall any current or past member of the Board or the Committee, or
		any officer or Employee of the Company, be held liable for any
		interpretation, construction or determination made or other action taken
		or any omission to act in connection with the Plan (or with any Grant
		Agreement), if made or taken in good faith. 
	 
	5.7          	Agents. In
		administering this Plan, the Committee may employ accountants and
		counsel and other persons to assist or render advice to it, all at the
		expense of the Company. 

ARTICLE 6. TERMS AND CONDITIONS OF OPTIONS

      Each Option granted under this Plan shall
be subject to the following terms and conditions: 

	 	 
	6.1          	Grant Agreement. 
		A proper officer of the Company as designated by the
		Committee and each Participant shall execute a Grant Agreement which
		shall be in the form approved by the Committee and shall set forth the
		Grant Date of the Option, the total number of shares of Common Stock
		subject to the Option to which such Grant Agreement pertains, the Option
		Price, whether it is a Nonqualified Option or an Incentive Stock Option,
		the time or times when the Option vests and becomes exercisable, the
		duration of the Option Period, and such other terms, conditions,
		restrictions, and privileges as the Committee in each instance shall
		deem appropriate, provided they are not inconsistent with the terms,
		conditions, and provisions of this Plan. 
	 
	6.2          	Option Price

	 	 	 
	 	(a)     	Incentive Stock Options. 
		The price per share of Common Stock subject to an
		Incentive Stock Option shall be no less than one hundred percent (100%)
		of the Fair Market Value of a share of Common Stock on the Grant Date of
		such Incentive Stock Option, except as provided in Section 6.8(c) below.
		

 

 

	 	 	 
	 	(b)     	Nonqualified Options. 
		The price per share of Common Stock subject to a
		Nonqualified Option shall be no less than one hundred percent (100%) of
		the Fair Market Value of the Company's Common Stock on the Grant Date of
		such Nonqualified Option. 

	 	 
	6.3          	Vesting and Exercise of Options.

	 	 	 
	 	(a)	Except as otherwise provided in this
		Article 6 of this Plan, an Option granted hereunder shall vest and
		become exercisable at such times, under such conditions, and in such
		manner as the Committee shall determine and specify in the Grant
		Agreement. Pursuant to the terms of the Grant Agreement or otherwise,
		the Committee may exercise discretion to change the date on which an
		outstanding Option vests and becomes exercisable; provided, 
		however, that a vesting date designated in a Grant Agreement may not
		be changed to a later date without the consent of the Participant.
		
	 
	 	(b)	Upon vesting of an Option, the Option
		may be exercised in whole or in part, but only with respect to whole
		shares of Common Stock, during the Option Period determined in
		accordance with Sections 6.4 through 6.6. An Option shall be exercised
		by (i) written notice to the Committee of the intent to exercise the
		Option with respect to a specified number of shares of Common Stock and
		(ii) payment for such shares as specified in Section 6.7 of this Plan.
		

	 	 
	6.4          	Option Period. 
		Each Grant Agreement shall specify the period during
		which an Option may be exercised (the "Option Period") and shall provide
		that the Option shall expire at the end of such Option Period. However,
		in no event shall an Option granted under this Plan be exercisable later
		than ten (10) years from the Grant Date. Subject to the terms of Section
		6.6 of this Plan, an Option granted pursuant hereto may be exercised
		only while a Participant remains employed by the Company or its
		Subsidiaries. 
	 
	6.5	Accelerated Vesting in the Event of
		Death, Permanent Disability, Retirement, or Change in Control. 
		

	 	 	 
	 	(a)	An Option granted under this Plan that
		is not fully vested and exercisable as of the date the Participant
		terminates his employment with the Company because of his death or
		Permanent Disability shall become fully vested and immediately
		exercisable on such date and may be exercised as provided in
		Section 6.6. 
	 
	 	(b)	In the event of termination of
		employment due to Retirement, an Option or part thereof, to the extent
		it would vest and become exercisable within two (2) years from the date
		of Retirement, shall vest and become immediately exercisable upon the
		Participant's termination of employment and may be exercised by the
		Participant as provided in Section 6.6. 
	 
	 	(c)	In the event of a Change in Control of
		the Company, as defined in Section 1.4, all unexercised outstanding
		Options under this Plan shall vest and become immediately exercisable in
		full and may be exercised at any time on and after the date of such
		Change in Control, provided that any such Options are exercised within
		the applicable Option Period determined in accordance with Sections 6.4
		and 6.6 of this Plan, except that in the case of a Change in Control by
		reason of a Business Combination such Options shall become exercisable
		and may be exercised as of the effective date of such Business
		Combination and, if not exercised, shall expire on such date.
		Notwithstanding the foregoing, in the event of a Change in Control by
		reason of a Business Combination, the expiration of an unexercised
		Option as of the effective date of such event shall occur only if the
		Participant has received notice by registered or certified mail, return
		receipt requested, of such proposed event not less than twenty
		(20) business days in advance of the effective date of the proposed
		event. 

 

 

	 	 
	6.6          	Exercise in the Event of Death,
		Permanent Disability, Retirement, or Termination of Employment.

	 	 	 
	 	(a)	In the event of termination of
		employment due to death or Permanent Disability, any Option or part
		thereof held by such Participant may be exercised within one (1) year
		following the date of death or Permanent Disability, as the case may be,
		but in no event any later than the expiration date of the Option
		determined under Section 6.4. In the event of the Participant's death
		within one (1) year following termination of employment by reason of
		Retirement or Permanent Disability, the Option may be exercised within
		one (1) year following the date of death, but in no event any later than
		the expiration date of the Option determined under Section 6.4. 
		
	 
	 	(b)     	Retirement. 
		In the event of termination of employment due to
		Retirement, an Option or part thereof, to the extent it is exercisable
		or becomes exercisable in accordance with Section 6.5(b), may be
		exercised at any time prior to the earlier of (i) the expiration date of
		the Option determined under Section 6.4, or (ii) one (1) year following
		the date of Retirement. 
	 
	 	(c)     	Termination of Employment for Reasons
		Other than Death, Permanent Disability or Retirement. 
		In the event of the Participant's termination from
		employment by reason other than death, Permanent Disability or
		Retirement, an Option held by such Participant may be exercised, only to
		the extent it was exercisable on the date of such termination, at any
		time prior to the earlier of (i) the expiration date of the Option
		determined under Section 6.4, or (ii) thirty (30) days from the date of
		such termination, unless the Participant's employment is terminated as a
		result of fraud or other gross misconduct on the part of the Participant
		(the existence of which shall be determined by the Committee in its sole
		discretion), in which case such Option shall terminate on the date of
		such termination of employment. Notwithstanding the foregoing, the
		Committee, in the exercise of its discretion, may extend such 30-day
		period, but in no event shall such period be extended beyond the
		expiration date of the Option determined under Section 6.4. 

	 	 
	6.7          	Payment of Option Price. 
		No shares of Common Stock shall be issued to any
		Participant upon exercise of an Option until full payment of the
		purchase price has been made to the Company and the Participant has
		remitted to the Company the required federal and state withholding
		taxes, if any. A Participant exercising an Option shall obtain no rights
		as a stockholder of the Company until certificates for the shares of
		Common Stock purchased under such Option are issued to the Participant.
		At the election of the Participant, payment of the purchase price and/or
		applicable withholding taxes, if any, may be made in whole, or in part,
		in shares of Common Stock owned by the Participant for more than six (6)
		months, excluding Restricted Shares, pursuant to such terms and
		conditions as may be established from time to time by the Committee. To
		the extent permitted by applicable law, Participants may simultaneously
		exercise Options and sell the shares of Common Stock thereby acquired
		pursuant to a brokerage or similar arrangement, approved in advance by
		the Committee, and use the proceeds from such sale as payment of the
		purchase price of such shares and all applicable withholding taxes. If
		any such payment is made in shares of Common Stock, such stock shall be
		valued at one-hundred percent (100%) of Fair Market Value on the day a
		Participant exercises his or her Option. If the Committee so determines,
		a Participant need not surrender shares of Common Stock as payment and
		the Company may, upon the giving of satisfactory evidence of ownership
		of said shares of Common Stock by Participant, deliver the appropriate
		number of additional shares of Common Stock reduced by the number of
		shares required to pay the purchase price and applicable withholding
		taxes. Such form of evidence shall be determined by the Committee.
		

 

 

	 	 
	6.8          	Additional Terms Applicable to
		Incentive Stock Options. All Options issued
		under this Plan as Incentive Stock Options will be subject, in addition
		to the terms detailed in Sections 6.1 through 6.7 above, to those terms
		contained in this Section 6.8. 

	 	 	 
	 	(a)     	Special Limitation on Incentive Stock
		Option Grants. Except as provided in
		Section 6.8(b) of this Plan, the aggregate Fair Market Value, determined
		as of the time an Incentive Stock Option is granted, of the Common Stock
		(and stock of a Subsidiary) with respect to which Incentive Stock
		Options granted under this Plan and stock options that satisfy the
		requirements of Section 422 of the Code granted under any other stock
		option plan or plans maintained by the Company (or any Subsidiary) are
		exercisable for the first time by a Participant during any calendar year
		shall not exceed $100,000 for such year. The foregoing limitation shall
		not take into account stock options which, by their terms, provide that
		they shall not be treated as incentive stock options. 
	 
	 	(b)     	Special Limitation on Incentive Stock
		Option Treatment.

	 	 	 
	 	(i)      	In General. 
		To the extent that, as a result of the rules described in
		Section 6.5 or otherwise, the aggregate Fair Market Value of Common
		Stock with respect to which Incentive Stock Options granted to a
		Participant are exercisable for the first time during any calendar year
		exceeds $100,000, such Options shall not be treated as Incentive Stock
		Options or otherwise as stock options which satisfy the requirements of
		Section 422 of the Code. 
	 
	 	(ii)      	Ordering Rule. 
		Clause (i) shall be applied by taking Incentive Stock
		Options into account in the order that they were granted. 
	 
	 	(iii)     	Allocation Rule. 
		If a single otherwise-qualifying Incentive Stock Option
		causes the aggregate Fair Market Value of all Common Stock with respect
		to which the Participant has been granted Incentive Stock Options
		exercisable for the first time during any calendar year to exceed
		$100,000, the Option will be treated in part as an Incentive Stock
		Option and in part as a Nonqualified Option. In such a case, the Company
		may designate which Common Stock acquired by such Option is to be
		treated as stock acquired pursuant to the exercise of an Incentive Stock
		Option by issuing a separate certificate (or certificates) for such
		stock and identifying such certificate (or certificates) as Incentive
		Stock Option stock in its stock transfer records. In the absence of such
		a designation, an equal proportion of each share of Common Stock
		acquired pursuant to such Option shall be treated as if acquired
		pursuant to the exercise of a Nonqualified Option. 

	 	 	 
	 	(iv)     	Special Definitions. 
		For purposes of this subsection (b), stock options
		granted to a Participant under any other stock option plan or plans
		maintained by the Company (or any Subsidiary) that satisfy the
		requirements of Section 422 of the Code shall be included within the
		term Incentive Stock Options, stock of a Subsidiary shall be included
		within the term Common Stock, and options which, by their terms, provide
		that they shall not be treated as incentive stock options shall not be
		taken into account. 

	 	 	 
	 	(c)     	Limits on Ten Percent Shareholders.
		The price at which shares of Common Stock may
		be purchased upon exercise of an Incentive Stock Option granted to an
		individual who, at the time such Incentive Stock Option is granted,
		owns, directly or indirectly, more than ten percent (10%) of the total
		combined voting power of all classes of stock issued to shareholders of
		the Company or any Subsidiary, shall be no less than one hundred and ten
		percent (110%) of the Fair Market Value of a share of the Common Stock
		of the Company at the time of grant, and such Incentive Stock Option
		shall by its terms not be exercisable after the earlier of the date
		determined in accordance with 

 

 

	 	 	 
	 	 	Sections 6.4 through 6.6 or the
		expiration of five (5) years from the Grant Date of such Incentive Stock
		Option. 
	 
	 	(d)     	Federal Income Tax Treatment. 
		A share of Common Stock transferred to a Participant
		pursuant to his exercise of an Incentive Stock Option shall not be
		treated as a share transferred pursuant to the exercise of an Incentive
		Stock Option for federal income tax purposes unless (i) no disposition
		of such share is made by the Participant within two (2) years from the
		Grant Date of the Incentive Stock Option nor within one (1) year after
		the transfer of such share to the Participant, and (ii) at all times
		during the period beginning on the Grant Date of the Incentive Stock
		Option and ending on the day three (3) months before the date of
		exercise of the Incentive Stock Option, the Participant was an Employee
		of either the Company, a parent of the Company or any Subsidiary.
		Notwithstanding Section 6.8(d)(ii), an Incentive Stock Option that is
		exercised within twelve (12) months after the Participant's employment
		ceases as a result of death shall continue to be treated as an Incentive
		Stock Option and an Incentive Stock Option that is exercised within
		twelve (12) months after the Participant's employment ceases as a result
		of a Permanent Disability shall continue to be treated as an Incentive
		Stock Option. In addition, Section 6.8(d)(i) shall not apply to an
		Incentive Stock Option exercised after the death of the Participant.
		
	 
	 	(e)     	Notice of Disposition; Withholding;
		Escrow. A Participant shall immediately notify
		the Company in writing of any sale, transfer, assignment or other
		disposition (or action constituting a disqualifying disposition within
		the meaning of Section 422 of the Code) of any shares of Common Stock
		acquired through exercise of an Incentive Stock Option, within two
		(2) years after the Grant Date of such Incentive Stock Option or within
		one (1) year after the acquisition of such shares, setting forth the
		date and manner of disposition, the number of shares disposed of, and
		the price at which such shares were disposed. The Company or any
		Subsidiary shall be entitled to withhold from any compensation or other
		payments then or thereafter due to the Participant such amounts as may
		be necessary to satisfy any withholding requirements of federal or state
		law or regulation and, further, to collect from the Participant any
		additional amounts which may be required for such purpose. The Committee
		may, in its discretion, require shares of Common Stock acquired by a
		Participant upon exercise of an Incentive Stock Option to be held in an
		escrow arrangement for the purpose of enabling compliance with the
		provisions of this Section 6.8(e). 

ARTICLE 7. RESTRICTED SHARES 

	 	 
	7.1          	Restricted Shares.
		The Committee is authorized to grant Restricted Shares to Participants
		on the following terms and conditions: 

	 	 	 
	 	(a)     	Grant and Restrictions.
		Restricted Shares shall be subject to such restrictions on
		transferability, risk of forfeiture and other restrictions, if any, as
		the Committee may impose, which restrictions may lapse separately or in
		combination at such times, under circumstances (including based on
		achievement of performance goals and/or future service requirements), in
		such installments or otherwise, as the Committee may determine on the
		Grant Date or thereafter. Except to the extent restricted under any
		Grant Agreement relating to the Restricted Shares, a Participant granted
		Restricted Shares shall have all of the rights of a shareholder,
		including the right to vote the Restricted Shares and the right to
		receive dividends thereon (subject to any mandatory reinvestment or
		other requirement imposed by the Committee). During the restriction
		period applicable to the Restricted Shares, the Restricted Shares may
		not be sold, transferred, pledged, hypothecated, margined or otherwise
		encumbered by the Participant. 

 

 

	 	 	 
	 	(b)     	Forfeiture.
		Except as otherwise determined by the Committee, upon a Participant's
		termination of employment during the applicable restriction period,
		Restricted Shares held by the Participant that are at that time subject
		to restrictions shall be forfeited and reacquired by the Company;
		provided that the Committee may, in its discretion, in any individual
		case provide for waiver in whole or in part of restrictions or
		forfeiture conditions relating to Restricted Shares. 
	 
	 	(c)     	Certificates for Restricted Shares.
		Restricted Shares granted under this Plan may be evidenced in such
		manner as the Committee shall determine. If certificates representing
		Restricted Shares are registered in the name of the Participant, the
		Committee may require that such certificates bear an appropriate legend
		referring to the terms, conditions and restrictions applicable to such
		Restricted Shares, that the Company retain physical possession of the
		certificates, and that the Participant deliver a stock power to the
		Company, endorsed in blank, relating to the Restricted Shares. 
		
	 
	 	(d)     	Dividends and Splits.
		As a condition to a Grant of Restricted Shares, the Committee may
		require that any cash dividends paid on a share of Restricted Shares be
		automatically reinvested in additional shares of Restricted Shares or
		applied to the purchase of additional Restricted Shares under this Plan.
		Unless otherwise determined by the Committee, shares of Common Stock
		distributed as a dividend shall be subject to restrictions and a risk of
		forfeiture to the same extent as the Restricted Shares with respect to
		which such shares of Common Stock or other property have been
		distributed. 
	 
	 	(e)     	Effect of Change in Control.
		Unless the Committee shall determine otherwise at the time of a
		Restricted Share Grant, any restriction periods and restrictions imposed
		on Restricted Shares under this Plan shall lapse upon a Change in
		Control and within ten (10) business days the certificates representing
		the Restricted Shares, without any such restrictions, shall be delivered
		to the applicable Participant. 

ARTICLE 8. BONUS SHARES AND OTHER GRANTS

	 	 
	8.1          	Bonus Shares and Grants in Lieu of
		Obligations. The Committee is authorized to
		grant shares of Common Stock as a bonus, or to grant shares of Common
		Stock or other Grants in lieu of obligations to pay cash or deliver
		other property under this Plan or under other plans or compensatory
		arrangements ("Bonus Shares") to employees. Bonus Shares or Grants made
		hereunder shall be subject to such other terms as shall be determined by
		the Committee. 

ARTICLE 9. AMENDMENT AND TERMINATION

	 	 
	9.1          	Amendment. 
		The Committee, from time to time and without further approval of the
		shareholders, may amend this Plan in such respects as the Committee may
		deem advisable; provided, however, that no amendment shall become
		effective without prior approval of the shareholders which would (a)
		materially increase the benefits accruing to Insider Participants; (b)
		materially increase the number of securities which may be issued under
		this Plan to Insider Participants; or (c) materially modify the
		requirements as to eligibility for participation in this Plan to add a
		class of Insider Participants; provided, further, that any increase in
		the number of shares available under this Plan and any change in the
		designation of the group of Employees eligible to receive Incentive
		Stock Options under this Plan shall be subject to shareholder approval
		in accordance with Section 422 of the Code. No amendment shall, without
		the Participant's (or beneficiary's) consent, alter or impair any of the
		rights or obligations under any Grant previously made to him under this
		Plan. 

 

 

	 	 
	9.2          	Termination. 
		Unless terminated sooner, this Plan shall remain in
		effect for ten (10) years ending on the tenth anniversary of Board
		adoption of the Plan, and subject to the provisions of Section 2.2
		hereof, thereafter for so long as Grants made under this Plan prior to
		the date of termination remain outstanding. The Board, without further
		approval of the shareholders, may terminate this Plan at any time, but
		no termination shall, without the Participant's (or beneficiary's)
		consent, alter or impair any of the rights under any Grant previously
		made to him under this Plan. 

ARTICLE 10. MISCELLANEOUS PROVISIONS

	 	 
	10.1       	No Rights as a Shareholder. 
		No Participant shall have any rights as a shareholder
		with respect to any shares of Common Stock subject to his Option prior
		to the date of issuance to him of a certificate or certificates for such
		shares. Holders of Restricted Shares, however, shall have the rights as
		a shareholder set forth in Article 7 of this Plan with regard to such
		Restricted Shares. 
	 
	10.2       	No Rights to Continued Employment.
		Neither this Plan nor any Grant made under
		this Plan shall confer upon any Participant any right with respect to
		continued employment by the Company, nor shall they interfere in any way
		with the right of the Company, or the right of the Participant, to
		terminate the employment of the Participant at any time. 
	 
	10.3       	Compliance With Other Laws and
		Regulations. The Plan, the making of Grants,
		the exercise of Options, and the obligation of the Company to sell and
		deliver shares of Common Stock hereunder, shall be subject to all
		applicable federal and state laws, rules, and regulations and to such
		approvals as may be required by any government or regulatory agency. The
		Company shall not be required to issue or deliver any certificates for
		shares of Common Stock under this Plan prior to (a) the obtaining of any
		approval or ruling from the Securities and Exchange Commission, the
		Internal Revenue Service or any other governmental agency which the
		Company, in its sole discretion, shall determine to be necessary or
		advisable, (b) the listing of such shares on any stock exchange on which
		the Common Stock may then be listed, and (c) the completion of any
		registration or qualification of such shares under any federal or state
		law, or any rule or regulation of any government body which the Company
		shall, in its sole discretion, determine to be necessary or advisable.
		
	 
	10.4       	No Right to Options, Restricted
		Shares or Bonus Shares. The making of any
		Grant pursuant to this Plan shall be entirely in the discretion of the
		Committee. The adoption of this Plan shall not be deemed to give any
		person any right to a Grant, except to the extent and upon such terms
		and conditions as may be determined by the Committee. 
	 
	10.5       	Withholding. 
		It shall be a condition of a Participant's right (a) to
		exercise Options granted hereunder, (b) to receive any Restricted Shares
		granted hereunder, and/or (c) to receive Bonus Shares, that the
		Participant shall, at the option of the Committee, pay, surrender
		shares, consent to the withholding by the Company of, or make other
		provision satisfactory to the Company for the payment of, any federal,
		state or other taxes which the Company is obligated to withhold or
		collect with respect to such exercise or otherwise with respect to such
		Options or as relates to such Restricted Shares or Bonus Shares. The
		Company is authorized to pay any such federal, state or other taxes
		resulting from the exercise of an Option or the grant of Restricted
		Shares or Bonus Shares, by withholding from the number of shares of
		Common Stock otherwise issuable upon such exercise and/or from the
		number of shares of Restricted Shares or Bonus Shares otherwise issuable
		to the Participant, such number of shares that, based on the Fair Market
		Value of the shares on the date the Option is exercised or the date that
		Restricted Shares or Bonus Shares are granted (or with respect to
		Restricted Shares, at the Company's election, based on the Fair Market
		Value of shares on the date the restrictions lapse), will satisfy such
		federal, state or other tax. 
	 
	10.6       	Nontransferability of Grants;
		Restrictions on Transferability of Shares.
		Options granted under this Plan shall not be transferable other than by
		will or by the laws of descent and distribution. Notwithstanding the
		

 

 

	 	 
	 	foregoing, the Committee, in its sole
		and absolute discretion, may grant Options (other than Incentive Stock
		Options) that can be transferred by gift to or for the benefit of family
		members of the Participants or that can be transferred without
		consideration to a trust established by the Participant for his
		beneficiaries. 
	 
	 	The designation of a beneficiary shall
		not constitute a transfer. During the lifetime of the Participant, an
		Option shall be exercisable only by such Participant or, if the
		Participant is legally incompetent, by the Participant's guardian or
		legal representative, or, if transferred pursuant to a transfer
		permitted above, by the transferee of such Participant. 
	 
	 	The Committee may also impose such
		restrictions on the transfer of any Restricted Shares, Bonus Shares and
		any shares of Common Stock acquired pursuant to the exercise of an
		Option under this Plan as it may deem advisable, including, without
		limitation, restrictions pursuant to the federal securities laws or any
		blue sky or other state securities laws, or under the requirements of
		any stock exchange upon which such shares of Common Stock are then
		listed. 
	 
	10.7       	Investment Representation. 
		Each Grant Agreement evidencing the grant of an
		Option, Restricted Shares or Bonus Shares shall provide that, upon
		demand by the Committee, the Participant (or his beneficiary, guardian,
		legal representative or transferee, as applicable) shall deliver to the
		Committee at the time any Grant is made under this Plan and/or at the
		time an Option, or any portion of an Option, is exercised, such written
		representations with respect to the shares to be acquired upon such
		Grant and/or exercise as the Committee may deem necessary to satisfy the
		requirements of federal or state securities law. Delivery of such
		representations as may be requested by the Committee pursuant to this
		Section 10.7 shall be a condition precedent to the right of the
		Participant (or such other person) to receive and/or purchase any shares
		of Common Stock under this Plan. 
	 
	10.8       	Designation of Beneficiary. 
		Each Participant may, from time to time, designate
		any beneficiary or beneficiaries to whom any benefit under the Plan is
		to be paid or transferred in case of his death prior to the distribution
		of all benefits due the Participant under this Plan. Such beneficiary
		shall be entitled to exercise any Option that is or becomes vested upon
		the death of the Participant, subject to the terms hereof. Each
		designation shall revoke all prior designations, shall be in the form
		prescribed by the Committee, and will be effective only when filed by
		the Participant with the Committee. In the absence of any such
		designation at the time of the Participant's death, all outstanding
		Grants made to the Participant under this Plan that have not previously
		been transferred as permitted in Section 10.6 above shall be
		transferred, and all benefits due the Participant under this Plan shall
		be distributed, to his estate. With respect to all outstanding Grants to
		the Participant under this Plan that have previously been transferred as
		permitted in Section 10.6 above, all benefits due the transferee under
		this Plan shall be distributed to such transferee. 
	 
	10.9       	Headings. 
		Any headings preceding the text of the sections of this Plan are
		inserted for convenience of reference only, and shall neither constitute
		a part of this Plan nor affect its meaning, construction, or effect.
		

	 	 
	10.10     	Governing Law. 
		All rights under this Plan shall be governed by and
		construed in accordance with the internal laws of the State of
		Connecticut without giving effect to the principles of conflicts or
		choice of law rules of any jurisdiction. 
	 
	10.11     	Pronouns. 
		The use of the masculine gender shall be extended to include the
		feminine gender wherever appropriate. 
	 
	10.12     	Reservation of Shares.
		The Company, during the term of this Plan, shall at all times reserve
		and keep available such number of shares as shall be sufficient to
		satisfy the requirements of the Plan.Exhibit 10.29

Exhibit 10.29

 

April 25, 2006

 

Mr. Gregory Wolf

Senior Vice President

Gerber Scientific, Inc.

83 Gerber Road West

South Windsor, Connecticut 06074

Dear Greg: 

         Gerber Scientific, Inc. (the "Company") considers it essential to the best interests of its stockholders to foster the continuous employment of key management personnel.  In this connection, should the Company face a possible Change in Control (as defined in Section 2 of this Agreement), such as the acquisition of a substantial share of the equity or voting securities of the Company, the Board of Directors of the Company (the "Board") has determined that it is imperative that it and the Company be able to rely upon your continued services without concern that you might be distracted by the personal uncertainties and risks that the possibility of a Change in Control might entail.

         Accordingly, the Board has determined that appropriate steps should be taken to reinforce and encourage the continued attention and dedication of members of the Company's management to their assigned duties without distraction in the face of potentially disturbing circumstances that could arise out of a possibility for a Change in Control of the Company.

 

         In order to induce you to remain in the employ of the Company and its subsidiaries and in consideration of your agreement set forth in Section 2(B) hereof, the Company agrees that you shall receive the severance benefits set forth in this letter agreement ("Agreement") in the event your employment with the Company and its subsidiaries is terminated subsequent to a Change in Control under the circumstances described below.

	 Term of Agreement   

         This Agreement shall commence on the date hereof and shall continue in effect through April 30, 2007, provided, however, the term of this Agreement shall automatically be extended for one additional year commencing on May 1, 2007 and on each May 1 thereafter, unless, not later than April 30 of the preceding year, the Company shall have given notice that it does not wish to extend this Agreement; provided further that, notwithstanding any such notice by the Company not to extend, if a Change in Control shall have occurred during the original or any extended term of this Agreement, this Agreement shall continue in effect for a period of twenty-four (24) months beyond the expiration of the term in effect immediately before such Change in Control; provided further that, notwithstanding anything herein to the contrary, if at any time prior to a Change in Control you, for whatever reason, cease to be Senior Vice President of the Company, then this Agreement shall automatically terminate and, at all times thereafter, shall be null and void and of no further force and effect and you shall not be entitled to any benefits whatsoever hereunder.

 

	Change in Control  

 	No benefits shall be payable hereunder unless there shall have been a Change in Control of the Company, as set forth below. For purposes of this Agreement a "Change in Control" of the Company shall mean the occurrence of any one or more of the following events:

 	the Company shall (1) merge or consolidate with or into another corporation or entity or enter into a share exchange between the Company or stockholders of the Company and another individual, corporation or other entity and as a result of such merger, consolidation or share exchange less than fifty percent (50%) of the outstanding voting securities of the surviving or resulting corporation or entity shall then be owned in the aggregate by the former stockholders of the Company; or (2) sell, lease, exchange or otherwise dispose of more than two-thirds (2/3) of the Company's property and assets in one transaction or a series of related transactions to one or more individuals, corporations or other entities that are not subsidiaries of the Company, assuming that if consummation of such transaction is subject, at the time of such approval by stockholders, to the consent of any government or governmental agency, such consent by the government or governmental agency is obtained (either explicitly or implicitly by consummation of the transaction);

 
	the stockholders of the Company adopt a plan of complete liquidation of the Company;

 
	any "person" (as such term is used in Sections 13(d) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")) (other than the Employee, the Company, any of the Company's subsidiaries, any employee benefit plan of the Company and/or one or more of its subsidiaries or any person or entity organized, appointed or established pursuant to the terms of any such employee benefit plan) becomes the beneficial owner (within the meaning of Rule 13d-3 under the Exchange Act) of voting securities of the Company representing thirty percent (30%) or more of the total number of votes eligible to be cast at any election of directors of the Company;
		provided, however, that no Change in Control shall be deemed to have occurred under this subparagraph (iii) if such "person" becomes a holder of the Company's securities in one or more transactions initiated or pursued by the Company unless after such transaction(s) less than fifty percent (50%) of the outstanding voting securities of the Company shall be owned in the aggregate by the former stockholders of the Company; or

 
	as a result of, or in connection with, any tender offer or exchange offer, share exchange, merger, consolidation or other business combination, sale, lease, exchange or other disposition of more than two-thirds (2/3) of the Company's assets, a contested election, or any combination of the foregoing transactions, the persons who are directors of the Company on the date hereof (the "Incumbent Board") shall cease to constitute a majority of the Board of Directors of the Company or any successor to the Company;
		provided that any person becoming a director subsequent to the date hereof whose election or nomination for election by the Company's stockholders was approved by a vote of at least three-quarters (3/4) of the directors comprising the Incumbent Board (either by a specific vote or by approval of a proxy statement of the Company in which such person is named as a nominee for director without any objection to such nomination) shall be, for purposes herein, considered as though such person were a member of the Incumbent Board.

 

		In exchange for the benefits under this Agreement, you agree that, subject to the terms and conditions herein, in the event of a potential Change in Control of the Company occurring after the date hereof, you will not voluntarily terminate your employment with the Company and its subsidiaries until the earlier of (i) the date which is six months after the occurrence of such potential Change in Control of the Company or (ii) the occurrence of a Change in Control of the Company.  If more than one potential Change in Control occurs during the term of this Agreement, the provisions of the preceding sentence shall be applicable to each potential Change in Control occurring prior to an actual Change in Control.   For the purposes of this Agreement, a "potential Change in Control" of the Company shall be deemed to have occurred if: (i) the Company enters into an agreement, the consummation of which would result in the occurrence of a Change in Control; (ii) any person (including the Company) publicly announces an intention to take or to consider taking actions which if consummated would constitute a Change in Control; or (iii) the Board adopts a resolution to the effect that, for purposes of this Agreement, a potential Change in Control of the Company has occurred.

 
	Termination Following Change in Control. If any of the events described in Section 2 hereof constituting a Change in Control shall have occurred, you shall be entitled to the benefits provided in Section 4 hereof upon the subsequent termination of your employment with the Company and its subsidiaries during the term of this Agreement and within two (2) years of the Change in Control,
unless such termination is (x) a result of your death, Disability, or Retirement; (y) by you for other than Good Reason (as defined in Section 3(A)); or (z) by the Company or any of its subsidiaries for Cause (as defined in Section 3(C)).  The benefits provided in Section 4 shall be in lieu of any termination, separation, severance or similar benefits under your employment agreement, if any, or under the Company's termination, separation, severance or similar plans or policies, if any (other than benefit plans of the Company which incidently provide for benefits in the event of a change in control, as such term is defined in such plans). If your employment is terminated as a result of your death, Disability or Retirement, by you for other than Good Reason or by the Company or any of its subsidiaries for Cause, then you shall not be entitled to any termination, separation, severance or similar benefits under this Agreement, and you shall be entitled to benefits under your employment agreement, if any, and/or under the Company's termination, separation, severance or similar plans or policies, if any, only in accordance with the terms of any such employment agreement, plans and policies.

 	Good Reason. You shall be entitled to terminate your employment for Good Reason.  For the purposes of this Agreement, "Good Reason" shall mean the occurrence, without your express written consent, of any of the following circumstances:

 	a significant change in the nature or scope of your authorities, duties or responsibilities from those applicable to you immediately prior to the date on which a Change in Control occurs;

 
	a reduction in your base annual salary from that provided to you immediately prior to the date on which a Change in Control occurs;

 
	a diminution in your eligibility to participate in compensation plans and employee benefits and perquisites which provide opportunities to receive overall compensation and benefits and perquisites from the greater of:

(a)the opportunities provided by the Company (including its subsidiaries) for executives with comparable duties; or

		(b)the opportunities under any such plans and perquisites under which you were participating immediately prior to the date on which a Change in Control occurs;

 

			a change in the location of your principal place of employment by the Company (including its subsidiaries) by more than fifty (50) miles from the location where you were principally employed immediately prior to the date on which a Change in Control occurs;
		

 
	a significant increase in the frequency or duration of your business travel; or

 
	a reasonable determination by the Board of Directors of the Company that, as a result of a Change in Control and a change in circumstances thereafter significantly affecting your position, you are unable to exercise the authorities, powers, functions or duties attached to your position immediately prior to the date on which a Change in Control occurs.

 
	Disability; Retirement.  

 	For purposes of this Agreement, "Disability" shall mean permanent and total disability as such term is defined under Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the "Code").
		Any question as to the existence of your Disability upon which you and the Company cannot agree shall be determined by a qualified independent physician selected by you (or, if you are unable to make such selection, such selection shall be made by any adult member of your immediate family or your legal representative) and approved by the Company, said approval not to be unreasonably withheld.  The determination of such physician shall be made in writing to the Company and to you and shall be final and conclusive for all purposes of this Agreement.

 
	For purposes of this Agreement, "Retirement" shall mean your voluntary termination of employment with the Company at or after the age of 65 in accordance with the Company's retirement policies (excluding early retirement) generally applicable to its salaried employees or in accordance with any retirement arrangement established with your consent with respect to you.

 

		Cause.  For purposes of this Agreement, "Cause" shall mean (a) the willful and continued failure by you to substantially perform your duties with the Company (other than any such failure from your incapacity due to physical or mental illness or any such actual or anticipated failure after the issuance of a Notice of Termination in the manner provided for in Section 3(D) by you for Good Reason) after written demand for substantial performance is delivered to you by the Board, which demand specifically identifies the manner in which the Board believes that you have not substantially performed your duties, or (b) the willful engaging by you in conduct which is demonstrably and materially injurious to the Company, monetarily or otherwise.  For purposes of this Section 3(C), no act, or failure to act, on your part shall be deemed "willful" unless done, or omitted to be done, by you not in good faith and without reasonable belief that your action or omission was in the best interest of the Company.  Notwithstanding the foregoing, you shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to you a copy of a resolution duly adopted by the affirmative vote of not less than three-quarters (3/4) of the entire membership of the Board at a meeting of the Board called and held for such purpose (after reasonable notice to you and an opportunity for you, together with your counsel, to be heard before the Board), finding that, in the good faith opinion of the Board you were guilty of conduct set forth above in this Section 3(C) and specifying the particulars thereof.

 
	Any termination of your employment by the Company or any of its subsidiaries or by you shall be made by written notice of termination to the other party.  Such "Notice of Termination" shall mean a written document specifying the provision in this Agreement being relied upon and setting forth a summary of the facts and circumstances which provide the basis for termination of your employment.  The "Date of Termination" shall be the date upon which the Notice of Termination is given.

 
	Compensation upon Termination Following a Change in Control 

 	If your employment shall be terminated for any reason otherwise than (x) as a result of your death, Disability or Retirement; (y) by you for other than Good Reason; or (z) by the Company or any of its subsidiaries for Cause, within two (2) years following a Change in Control (as defined in Section 2), then you shall be entitled to the benefits provided below:

 	The Company or one of its subsidiaries shall pay you, not later than the fifth business day following the Date of Termination ("Payment Date"), the sum of your full base salary through the Date of Termination, as earned by you but not yet paid to you, at the salary level in effect on (x) the Date of Termination or (y) the day immediately preceding the date of the Change in Control, whichever is higher ("full base salary"), and your pro rata share of your annual incentive bonus payment in effect on the Date of Termination.  The Company or one of its subsidiaries shall also pay you all other amounts to which you are entitled under any compensation plan of the Company applicable to you, at the time such payments are due.  For purposes of this Section 4 and the other provisions of this Agreement, "your annual incentive bonus payment in effect on the Date of Termination" shall mean the target amount of your annual incentive bonus payment (under the Company's Annual Incentive Bonus Plan or any successor plan) for the year in which the Notice of Termination is given.  Your pro rata share of your annual incentive bonus payment in effect on the Date of Termination shall be that percentage of your annual incentive bonus payment in effect on the Date of Termination that is equal to the number of days in the fiscal year completed prior to the Date of Termination divided by 365.

 
	On the Payment Date the Company shall also pay you a severance payment equal to two and one-half (2 1/2) times the sum of (x) your full base salary and (y) your annual incentive bonus payment in effect on the Date of Termination.
		

 
	The Company shall cause (x) all unvested stock options or other stock grants held by you on the Date of Termination immediately to vest and be fully exercisable as of the Date of Termination, (y) any restrictions on all restricted stock held by you on the Date of Termination immediately to lapse and all shares of such stock to fully vest as of the Date of Termination, and (z) any accrued benefit or deferred arrangement of the Company that you otherwise would become entitled to if you continued employment with the Company immediately to vest as of the Date of Termination.

 
	The Company shall maintain in full force for two and one-half (2 1/2) year(s) following the Date of Termination (the "Benefit Period") all life insurance, health (medical and dental), accidental death and dismemberment, pension and disability plans and programs in which you are entitled to participate immediately prior to the Date of Termination, or if your continued participation is not possible under the general terms and provisions of such plans and programs, the Company shall provide you with benefits equivalent to those provided by such plans and programs,
		provided that the Company will not be required to maintain these plans and programs, or the equivalent thereof, beyond your reaching the age of 65 or upon your securing new full time employment which makes such benefits available to you.  Additional years of service equal to the length of the Benefit Period will be credited to you for purposes of calculating your benefits under the Company's Pension Plans at the rate of your full base salary and annual incentive bonus payment in effect on the Date of Termination (as defined in Section 4(A)(i) hereof).

 
	The Company shall make available to you, at the Company's expense, outplacement counseling services.  You may select the organization that will provide you with such services, provided that the Company shall not be required to pay more than $50,000 for any such services.
		

 

		There shall be no limit on the amount of payments due you under Section 4(A) unless (i) your net income from the payments made under Section 4(A) would be maximized, in consideration of federal, state and local income and excise taxes, from limiting the sum of payments (the "Total Lump Sum Payment") in Section 4(A) to 2.99 times your prior five years' average income, or "base amount" as defined in Section 280G of the Internal Revenue Code, as amended (the "Code"), and (ii) the Total Lump Sum Payment due to you is more than 2.99 times your base amount but not more than 3.5 times your base amount.  In such case, your Total Lump Sum Payment will be reduced to 2.99 times your base amount.
	

 
	In the event that any payment or benefit received or to be received by you pursuant to the terms of this Agreement (the "Contract Payments") or in connection with your termination of employment or contingent upon a Change in Control of the Company pursuant to any plan or arrangement or other agreement with the Company (or any affiliate) ("Other Payments" and, together with the Contract Payments, the "Payments") would be subject to the excise tax (the "Excise Tax") imposed by Section 4999 of the Code, as determined as provided below, and has not been subject to the modified cap described in Section 4(B), the Company shall pay to you, at the time specified in Section 4(C)(iii) below, an additional amount (the "Gross-Up Payment") such that the net amount retained by you, after deduction of the Excise Tax on Contract Payments and Other Payments and any federal, state and local income tax and Excise Tax upon the payment provided for by this Section 4(C), and any interest, penalties or additions to tax payable by you with respect thereto, shall be equal to the total present value of the Contract Payments and Other Payments at the time such Payments are to be made.

 	For purposes of determining whether any of the Payments will be subject to the Excise Tax and the amounts of such Excise Tax

(a)the total amount of the Payments shall be treated as "parachute payments" within the meaning of Section 280G(b)(2) of the Code, and all "excess parachute payments" within the meaning of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax, except to the extent that, in the opinion of independent tax counsel retained by the Company's independent auditors and reasonably acceptable to you ("Tax Counsel"), a Payment (in whole or in part) does not constitute a "parachute payment" within the meaning of Section 280G(b)(2) of the Code, or such "excess parachute payments" (in whole or in part) are not subject to the Excise Tax;

		(b)the amount of the Payments that shall be treated as subject to the Excise Tax shall be equal to the lesser of (A) the total amount of the Payments or (B) the amount of "excess parachute payments" within the meaning of Section 280G(b)(1) of the Code (after applying the previous clause); and

		(c)the value of any noncash benefits or any deferred payment or benefit shall be determined by Tax Counsel in accordance with the principles of Sections 280G(d)(3) and (4) of the Code.

 

			For purposes of determining the amount of the Gross-Up Payment, you shall be deemed to pay federal income tax at the highest marginal rates of federal income taxation applicable to individuals in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at the highest marginal rates of taxation applicable to individuals as are in effect in the state and locality of your residence for tax purposes in the calendar year in which the Gross-Up Payment is to be made, net of the maximum reduction in federal income taxes that can be obtained from deduction of such state and local taxes, taking into account any limitations applicable to individuals subject to federal income tax at the highest marginal rates.

 
	The Gross-Up Payments provided for in this Section 4(C) hereof shall be made upon the earlier of (x) the payment to you of any Contract Payment or Other Payment or (y) the imposition upon you or payment by you of any Excise Tax.
		

 
	If it is established pursuant to a final determination of a court or an Internal Revenue Service proceeding or the opinion of Tax Counsel that the Excise Tax is less than the amount taken into account under this Section 4(C), you shall repay to the Company within five (5) business days of your receipt of notice of such final determination or opinion the portion of the Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and federal, state and local income tax imposed on the Gross-Up Payment being repaid by you if such repayment results in a reduction in Excise Tax or a federal, state and local income tax deduction) plus any interest received by you on the amount of such repayment.  If it is established pursuant to a final determination of a court or an Internal Revenue Service proceeding or the opinion of Tax Counsel that the Excise Tax exceeds the amount taken into account hereunder (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional Gross-Up Payment in respect of such excess within five (5) business days of the Company's receipt of notice of such final determination or opinion.

 
	The Company shall also pay to you all legal fees and expenses, if any, reasonably incurred by you in connection with seeking to obtain or enforce any right or benefit provided by this Agreement.

 
	You shall not be required to mitigate the amount of any payment provided for in this Section 4 by seeking other employment or otherwise, nor shall the amount of any payment or benefit provided for in this Section 4 be reduced by any compensation earned by you as the result of employment by another employer or by retirement benefits received after the Date of Termination or otherwise.

 
	Successors; Binding Agreement 

 	The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no succession had taken place.  Failure of the Company to obtain such assumption and agreement within thirty days following the effectiveness of any such succession shall be a breach of this Agreement and shall entitle you to compensation from the Company in the same amount and on the same terms as you would be entitled hereunder if you had terminated your employment for Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the Date of Termination.  As used in this Agreement, "Company" shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.
	

 
	This Agreement shall inure to the benefit of and be enforceable by your personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.  If you should die while any amount would still be payable to you hereunder if you had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to your devisee, legatee or other designee or, if there is no such designee, to your estate.

 

	Confidential Information.  You shall hold in fiduciary capacity for the benefit of the Company or its subsidiaries all secret or confidential information, knowledge or data relating to the Company, the subsidiaries and their respective businesses, which shall have been obtained during your employment by the Company or its subsidiary and which shall not be public knowledge (other than by acts by you or your representatives in violation of this Agreement). After termination of your employment with the Company or its subsidiaries, you shall not, without prior written consent of the Company or its subsidiaries, communicate or divulge any such information, knowledge or data to anyone other than the Company or its subsidiaries or those designated by them.  The preceding two sentences shall not apply with respect to any information you are required to disclose pursuant to a valid and effective subpoena or order issued by a court of competent jurisdiction or with respect to any information you are reasonably required to disclose in enforcing the terms of this Agreement.  In no event shall an asserted violation of this Section 6 constitute a basis for deferring or withholding any amounts otherwise payable to you under this Agreement, nor will any asserted violation of this Section 6 relieve you of your responsibilities under this Agreement.

 	Agreement Not to Compete.  You agree that for a period of one year following the Date of Termination, you will not engage, directly or indirectly, whether as a principal, agent, distributor, representative, consultant, employee, partner, stockholder, limited partner or other investor (other than an investment of not more than two percent (2%) of the stock or equity of any corporation the capital stock of which is publicly traded) or otherwise, in the same or a substantially similar business as that conducted and carried on by the Company or any of its subsidiaries and being directly competitive with the Company or any of its subsidiaries on the Date of Termination or at any time during such one-year period.

 	Notice.  For the purpose of this Agreement, notices and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States registered mail, return receipt requested, postage prepaid, addressed to the address set forth on the first page of this Agreement with respect to the Company and on the signature page with respect to you,
provided that all notices to the Company shall be directed to the attention of the President of the Company, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

 	Miscellaneous.  No provision of this Agreement may be modified, waived or discharged unless such modification, waiver or discharge is agreed to in writing and signed by you and such officer as may be specifically designated by the Board.  No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any conditions or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.  Further, the validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Connecticut.  All references to sections of the Code or Exchange Act shall be deemed also to refer to any successor provisions to such sections.  Any payments provided for hereunder shall be paid net of any applicable withholding required under federal, state or local law.

 	Integration.  This Agreement contains the entire agreement of the parties hereto and supersedes all previous agreements between the parties, written or oral, express or implied, covering the subject matter hereof. 

 	Validity.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

 	Counterparts.  This Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

            If this letter sets forth our agreement on the subject matter hereof, kindly sign and return to the Company the enclosed copy of this letter which will then constitute our agreement on this subject.

                                                                                                            Sincerely,

                                                                                                            Gerber Scientific, Inc.

                                                                                                            By:  /s/ Marc T. Giles                                

                                                                                                                  Marc T. Giles

                                                                                                                  President and Chief Executive Officer

 

 

Agreed to this 10 day of December, 2006

 

By:   /s/ Gregory A. Wolf                               

       Gregory A. Wolf, Senior Vice President

       83 Gerber Road West

       South Windsor, CT 06074

       Address of Executive

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