Document:

Ryland Group, Inc

 

EXHIBIT 10.10

THE RYLAND GROUP, INC.

2002 EQUITY INCENTIVE PLAN

(as Amended July 10, 2002)

	1.	  	Purpose and Types of Awards

     The purpose of THE RYLAND GROUP, INC. 2002 EQUITY INCENTIVE PLAN (the
“Plan”) is to promote the long-term growth and profitability of the Corporation
by providing key people with incentives to improve stockholder value and to
contribute to the growth and financial success of the Corporation.

     The Plan permits the granting of stock options (including incentive stock
options qualifying under Code section 422 and nonqualified stock options),
stock appreciation rights, restricted or unrestricted stock awards, stock
units, or any combination of the foregoing.

	2.	  	Definitions

     Under this Plan, except where the context otherwise indicates, the
following definitions apply:

     (a) 
“Affiliate” shall mean any entity, whether now or hereafter existing,
which controls, is controlled by, or is under common control with, the
Corporation (including, but not limited to, joint ventures, limited liability
companies, and partnerships). For this purpose, “control” shall mean ownership
of 50% or more of the total combined voting power or value of all classes of
stock or interests of the entity.

     (b) 
“Award” shall mean any stock option, stock appreciation right,
restricted or unrestricted stock award, or stock unit award.

     (c) 
“Board” shall mean the Board of Directors of the Corporation.

     (d) 
“Change in Control” shall mean:

          (i) The acquisition by any person, other than the Corporation or any
employee benefit plans of the Corporation, of beneficial ownership of 20
percent or more of the combined voting power of the Corporation’s then
outstanding voting securities;

          (ii) The first purchase under a tender offer or exchange offer, other than
an offer by the Corporation or any employee benefit plans of the Corporation,
pursuant to which shares of Common Stock have been purchased;

          (iii) During any period of two consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the Corporation
cease for any reason to constitute at least a majority thereof, unless the
election or the nomination for the election by stockholders of the Corporation
of each new director was approved by a vote of at least two-thirds of the
directors then still in office who were directors at the beginning of the
period; or

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          (iv) Approval by stockholders of the Corporation of a merger,
consolidation, liquidation or dissolution of the Corporation, or the sale of
all or substantially all of the assets of the Corporation.

     (e)  “Code” shall mean the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder.

     (f)  “Common Stock” shall mean shares of common stock, $1.00 par value, of
the Corporation.

     (g)  “Corporation” shall mean The Ryland Group, Inc. and its successors and
assigns.

     (h)  “Designated Beneficiary” shall mean the beneficiary designated by an
Award holder, in a manner and to the extent determined by the Administrator, to
receive amounts due or exercise rights of the Award holder in the event of the
Award holder’s death. In the absence of an effective designation by an Award
holder, “Designated Beneficiary” shall mean the Award holder’s estate.

     (i)  “Effective Date” shall mean the date the Plan is approved by the
stockholders of the Corporation.

     (j)  “Fair Market Value” shall mean, with respect to a share of the
Corporation’s Common Stock or other property for any purpose on a particular
date, the value determined by the Administrator in good faith. However, if the
Common Stock is registered under Section 12(b) of the Securities Exchange Act
of 1934, as amended, “Fair Market Value” with respect to a share of the
Corporation’s Common Stock shall mean, as applicable, (i) either the closing
price or the average of the high and low sale price on the relevant date, as
determined in the Administrator’s discretion, quoted on the New York Stock
Exchange, the American Stock Exchange, or the Nasdaq National Market; (ii) the
last sale price on the relevant date quoted on the Nasdaq SmallCap Market;
(iii) the average of the high bid and low asked prices on the relevant date
quoted on the Nasdaq OTC Bulletin Board Service or by the National Quotation
Bureau, Inc. or a comparable service as determined in the Administrator’s
discretion; or (iv) if the Common Stock is not quoted by any of the above, the
average of the closing bid and asked prices on the relevant date furnished by a
professional market maker for the Common Stock, or by such other source,
selected by the Administrator. If no public trading of the Common Stock occurs
on the relevant date, then Fair Market Value shall be determined as of the next
preceding date on which trading of the Common Stock does occur. For all
purposes under this Plan, the term “relevant date” as used in this Section
2.1(i) shall mean either the date as of which Fair Market Value is to be
determined or the next preceding date on which public trading of the Common
Stock occurs, as determined in the Administrator’s discretion.

     (k)  “Grant Agreement” shall mean a written document memorializing the
terms and conditions of an Award granted pursuant to the Plan and shall
incorporate the terms of the Plan.

     (l)  “1992 Equity Incentive Plan” shall mean The Ryland Group, Inc. 1992
Equity Incentive Plan, the term of which expires on April 15, 2002.

	3.	  	Administration

     (a)  Administration of the Plan. The Plan shall be administered by the
Board, the Compensation Committee of the Board, or any committee or committees
that are appointed by the Compensation Committee or the Board from time to time
(the Board, the Compensation Committee of the Board and any appointed committee
or committees are referred to as the “Administrator”).

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     (b)  Powers of the Administrator. The Administrator shall have all the
powers vested in it by the terms of the Plan, such powers to include authority,
in its sole and absolute discretion, to grant Awards under the Plan, prescribe
Grant Agreements evidencing such Awards and establish programs for granting
Awards.

     The Administrator shall have full power and authority to take all other
actions necessary to carry out the purpose and intent of the Plan, including,
but not limited to, the authority to: (i) determine the eligible persons to
whom, and the time or times at which Awards shall be granted; (ii) determine
the types of Awards to be granted; (iii) determine the number of shares to be
covered by or used for reference purposes for each Award; (iv) impose such
terms, limitations, restrictions and conditions upon any such Award as the
Administrator shall deem appropriate; (v) modify, amend, extend or renew
outstanding Awards, or accept the surrender of outstanding Awards and
substitute new Awards (provided however, that, except as provided in Section
7(c) of the Plan, (A) any modification that would materially adversely affect
any outstanding Award shall not be made without the consent of the holder, and
(B) the exercise price for any outstanding stock option granted under the Plan
may not be decreased after the date of grant nor may any outstanding stock
option granted under the Plan be surrendered to the Corporation as
consideration for the grant of a new stock option with a lower exercise price);
and (vi) accelerate or otherwise change the time in which an Award may be
exercised or becomes payable and to waive or accelerate the lapse, in whole or
in part, of any restriction or condition with respect to such Award, including,
but not limited to, any restriction or condition with respect to the vesting or
exercisability of an Award following termination of any grantee’s employment or
other service relationship with the Corporation.

     The Administrator shall have full power and authority, in its sole and
absolute discretion, to administer and interpret the Plan and to adopt and
interpret such rules, regulations, agreements, guidelines and instruments for
the administration of the Plan and for the conduct of its business as the
Administrator deems necessary or advisable. To the extent permitted by
applicable law, the Administrator may delegate to one or more executive
officers of the Corporation the power to (i) grant Awards to individuals who
are not subject to Section 16 of the Securities Exchange Act of 1934, as
amended, or any successor provision and are not officers of the Corporation,
and (ii) make all determinations under the Plan with respect thereto, provided
that the Administrator shall fix the maximum amount of such Awards for the
group and a maximum for any one Award recipient.

     (c)  Non-Uniform Determinations. The Administrator’s determinations under
the Plan (including without limitation, determinations of the persons to
receive Awards, the form, amount and timing of such Awards, the terms and
provisions of such Awards and the Grant Agreements evidencing such Awards) need
not be uniform and may be made by the Administrator selectively among persons
who receive, or are eligible to receive, Awards under the Plan, whether or not
such persons are similarly situated.

     (d)  Limited Liability. To the maximum extent permitted by law, no member
of the Administrator shall be liable for any action taken or decision made in
good faith relating to the Plan or any Award thereunder.

     (e)  Indemnification. To the maximum extent permitted by law and by the
Corporation’s charter and by-laws, the members of the Administrator shall be
indemnified by the Corporation in respect of all their activities under the
Plan.

     (f)  Effect of Administrator’s Decision. All actions taken and decisions
and determinations made by the Administrator on all matters relating to the
Plan pursuant to the powers

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vested in it hereunder shall be in the Administrator’s sole and absolute
discretion and shall be conclusive and binding on all parties concerned,
including the Corporation, its stockholders, any participants in the Plan and
any other employee, consultant, or director of the Corporation, and their
respective successors in interest.

	4.	  	Shares Available for the Plan; Maximum Awards

     (a)  Subject to the following provisions of this Section 4 and adjustments
as provided in Section 7(c) of the Plan, the maximum number of shares of Common
Stock that may be issued with respect to Awards granted under the Plan shall be
equal to the sum of: (i) 650,000 shares of Common Stock; (ii) any shares of
Common Stock remaining under the 1992 Equity Incentive Plan on the date such
Plan expires that were not then subject to outstanding Awards; and (iii) any
shares of Common Stock that are represented by Awards granted under the 1992
Equity Incentive Plan that are forfeited, expire or are canceled without
delivery of shares of Common Stock or which result in the forfeiture of the
shares of Common Stock back to the Corporation.

     (b)  If any Award, or portion of an Award, under the Plan or the 1992
Equity Incentive Plan expires or terminates unexercised, becomes unexercisable
or is forfeited or otherwise terminated, surrendered or canceled as to any
shares, or if any shares of Common Stock are surrendered to the Corporation in
connection with any Award under the Plan or the 1992 Equity Incentive Plan
(whether or not such surrendered shares were acquired pursuant to any Award),
or if any shares are withheld by the Corporation, the shares subject to such
Award and the surrendered and withheld shares shall thereafter be available for
further Awards under the Plan; provided, however, that any such shares that are
surrendered to or withheld by the Corporation in connection with any Award or
that are otherwise forfeited after issuance shall not be available for purchase
pursuant to incentive stock options intended to qualify under Code section 422
and provided further, that no more than the number of shares available for
issuance on the Effective Date shall be made available for purchase pursuant to
such incentive stock options.

     (c)  If the exercise price of any stock option granted under the Plan or
the 1992 Equity Incentive Plan is satisfied by tendering shares of Common Stock
to the Corporation (by either actual delivery or by attestation), only the
number of shares of Common Stock issued net of the shares of Common Stock
tendered shall be deemed to have been issued for purposes of determining the
maximum number of shares of Common Stock available for issuance under the Plan.
To the extent any shares of Common Stock covered by an Award are not delivered
to an Award holder or the holder’s Designated Beneficiary because the Award is
settled in cash, such shares shall not be deemed to have been issued for
purposes of determining the maximum number of shares of Common Stock available
for issuance under the Plan.

     (d)  Notwithstanding the provisions of Section 4(a) of the Plan and subject
to adjustment as provided in Section 7(c) of the Plan, the maximum number of
shares of Common Stock that may be issued in conjunction with Awards granted
pursuant to subsections (c) and (d) of Section 6 of the Plan (relating to
restricted and unrestricted stock awards and stock units) shall be 130,000
shares of Common Stock; provided, however, that any shares of Common Stock that
are forfeited back to the Corporation with respect to any such Awards shall be
available for further Awards under subsections (c) and (d) of Section 6 of the
Plan.

     (e)  Subject to adjustments as provided in Section 7(c) of the Plan, the
maximum number of shares of Common Stock subject to Awards of any combination
that may be granted during any one fiscal year of the Corporation to any one
individual under this Plan shall be limited to 500,000

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shares. Such per-individual limit shall not be adjusted to effect a
restoration of shares of Common Stock with respect to which the related Award
is terminated, surrendered or canceled.

	5.	  	Participation

     Participation in the Plan shall be open to all employees, officers, and
directors of, and other individuals providing bona fide services to or for, the
Corporation, or of any Affiliate of the Corporation, as may be selected by the
Administrator from time to time. The Administrator may also grant Awards to
individuals in connection with hiring, retention or otherwise, prior to the
date the individual first performs services for the Corporation or an Affiliate
provided that such Awards shall not become vested prior to the date the
individual first performs such services.

	6.	  	Awards

     The Administrator, in its sole discretion, establishes the terms of all
Awards granted under the Plan. Awards may be granted individually or in tandem
with other types of Awards. All Awards are subject to the terms and conditions
provided in the Grant Agreement provided that all Awards shall have a minimum
vesting period of three years or one year plus performance criteria established
by the Administrator. The Administrator may permit or require a recipient of
an Award to defer such individual’s receipt of the payment of cash or the
delivery of Common Stock that would otherwise be due to such individual,
including the crediting of interest on deferred amounts denominated in cash and
dividend equivalents on amounts denominated in Common Stock, by virtue of the
exercise of, payment of, or lapse or waiver of restrictions respecting, any
Award. If any such payment deferral is required or permitted, the
Administrator shall, in its sole discretion, establish rules and procedures for
such payment deferrals.

     (a)  Stock Options. The Administrator may from time to time grant to
eligible participants Awards of incentive stock options as that term is defined
in Code section 422 or nonqualified stock options; provided, however, that
Awards of incentive stock options shall be limited to employees of the
Corporation or of any current or hereafter existing “parent corporation” or
“subsidiary corporation,” as defined in Code sections 424(e) and (f),
respectively, of the Corporation. No stock option shall be an incentive stock
option unless so designated by the Administrator at the time of grant or in the
Grant Agreement evidencing such stock option. All stock options granted under
the Plan must have an exercise price at least equal to Fair Market Value as of
the date of grant and may not have a term longer than ten (10) years. Except
for adjustments pursuant to Section 7(c), the exercise price for any
outstanding stock option granted under the Plan may not be decreased after the
date of grant nor may any outstanding stock option granted under the Plan be
surrendered to the Corporation as consideration for the grant of a new stock
option with a lower exercise price.

     (b)  Stock Appreciation Rights. The Administrator may from time to time
grant to eligible participants Awards of Stock Appreciation Rights (“SAR”). An
SAR entitles the grantee to receive, subject to the provisions of the Plan and
the Grant Agreement, a payment having an aggregate value equal to the product
of (i) the excess of (A) the Fair Market Value on the exercise date of one
share of Common Stock over (B) the base price per share specified in the Grant
Agreement, times (ii) the number of shares specified by the SAR, or portion
thereof, which is exercised. The base price per share with respect to an SAR
shall in no event be lower than Fair Market Value as of the date of grant.
Payment by the Corporation of the amount receivable upon any exercise of an SAR
may be made by the delivery of Common Stock or cash, or any combination of
Common Stock and cash, as determined in the sole discretion of the
Administrator. If upon settlement of the exercise of an SAR a grantee is to
receive a portion of such payment in shares of Common Stock, the number of
shares shall be determined by dividing such portion by the Fair

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Market Value of a share of Common Stock on the exercise date. No fractional
shares shall be used for such payment and the Administrator shall determine
whether cash shall be given in lieu of such fractional shares or whether such
fractional shares shall be eliminated.

     (c)  Stock Awards. The Administrator may from time to time grant
restricted or unrestricted stock Awards to eligible participants in such
amounts, on such terms and conditions, and for such consideration, including no
consideration or such minimum consideration as may be required by law, as it
shall determine. A stock Award may be paid in Common Stock, in cash, or in a
combination of Common Stock and cash, as determined in the sole discretion of
the Administrator.

     (d)  Stock Units. The Administrator may from time to time grant Awards to
eligible participants denominated in stock-equivalent units in such amounts and
on such terms and conditions as it shall determine. Stock units granted to a
participant shall be credited to a bookkeeping reserve account solely for
accounting purposes and shall not require a segregation of any of the
Corporation’s assets. An Award of stock units may be settled in Common Stock,
in cash, or in a combination of Common Stock and cash, as determined in the
sole discretion of the Administrator. Shares of Common Stock awarded in
connection with an Award of stock units may be issued for such consideration as
may be determined by the Administrator, including for no consideration or such
minimum consideration as may be required by law. Except as otherwise provided
in the applicable Grant Agreement, the grantee shall not have the rights of a
stockholder with respect to any shares of Common Stock represented by a stock
unit solely as a result of the grant of a stock unit to the grantee.

	7.	  	Miscellaneous

     (a)  Withholding of Taxes. Grantees and holders of Awards shall pay to the
Corporation or its Affiliate, or make provision satisfactory to the
Administrator for payment of, any taxes required to be withheld in respect of
Awards under the Plan no later than the date of the event creating the tax
liability. The Corporation or its Affiliate may, to the extent permitted by
law, deduct any such tax obligations from any payment of any kind otherwise due
to the grantee or holder of an Award. In the event that payment to the
Corporation or its Affiliate of such tax obligations is made in shares of
Common Stock, such shares shall be valued at Fair Market Value on the
applicable date for such purposes.

     (b)  Transferability. Except as otherwise determined by the Administrator,
and in any event in the case of an incentive stock option or a stock
appreciation right granted with respect to an incentive stock option, no Award
granted under the Plan shall be transferable by a grantee otherwise than by
will or the laws of descent and distribution. Unless otherwise determined by
the Administrator in accord with the provisions of the immediately preceding
sentence, an Award may be exercised during the lifetime of the grantee, only by
the grantee or, during the period the grantee is under a legal disability, by
the grantee’s guardian or legal representative.

     (c) Adjustments; Business Combinations.

          (i) Upon a stock dividend of, or stock split or reverse stock split
affecting, the Common Stock of the Corporation, (A) the maximum number of
shares reserved for issuance or with respect to which Awards may be granted
under the Plan and the maximum number of shares with respect to which Awards
may be granted during any one fiscal year of the Corporation to any individual,
as provided in Section 4 of the Plan, and (B) the number of shares covered by
and the exercise price and other terms of outstanding Awards, shall, without
further action of the Board, be adjusted to reflect such event unless the Board
determines, at the time it approves such stock dividend, stock split or reverse
stock split, that no such adjustment shall be made. The Administrator

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may make adjustments, in its discretion, to address the treatment of fractional
shares and fractional cents that arise with respect to outstanding Awards as a
result of the stock dividend, stock split or reverse stock split.

          (ii) In the event of any other changes affecting the Corporation, the
capitalization of the Corporation or the Common Stock of the Corporation by
reason of any spin-off, split-up, dividend, recapitalization, merger,
consolidation, business combination or exchange of shares and the like, the
Administrator except as otherwise provided in Section 7(d), in its discretion
and without the consent of holders of Awards, may make: (A) appropriate
adjustments to the maximum number and kind of shares reserved for issuance or
with respect to which Awards may be granted under the Plan, in the aggregate
and with respect to any individual, as provided in Section 4 of the Plan, and
to the number, kind and price of shares covered by outstanding Awards; and (B)
any other adjustments in outstanding Awards, including but not limited to
reducing the number of shares subject to Awards or providing or mandating
alternative settlement methods such as settlement of the Awards in cash or in
shares of Common Stock or other securities of the Corporation or of any other
entity, or in any other matters which relate to Awards as the Administrator
shall, in its sole discretion, determine to be necessary or appropriate.

          (iii) The Administrator is authorized to make, in its discretion and
without the consent of holders of Awards, adjustments in the terms and
conditions of, and the criteria included in, Awards in recognition of unusual
or nonrecurring events affecting the Corporation, or the financial statements
of the Corporation or any Affiliate, or of changes in applicable laws,
regulations, or accounting principles, whenever the Administrator determines
that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan and outstanding Awards.

     (d)  Change in Control. Notwithstanding the provisions of Section
7(c)(ii), in the event of a Change in Control, all Awards under the Plan are
automatically and fully vested and immediately exercisable or payable in whole
or in part. The obligations of the Corporation pursuant to the Plan and
performance with respect to rights of Award holders thereunder shall be assumed
by any participant, successor-in-interest or beneficiary of or interested party
in the Change in Control (collectively, the Change-in-Control Participant), and
the Change-in Control Participant shall cause the Awards to be assumed, or new
rights substituted therefor, by another entity.

     (e)  Substitution of Awards in Mergers and Acquisitions in which the
Corporation or an Affiliate is the Acquiring Entity. Solely in the event that
the Corporation or an Affiliate is an acquiring entity in a merger, acquisition
and other business combination, Awards may be granted under the Plan from time
to time in substitution for Awards held by employees, officers, consultants or
directors of a target entity who become or are about to become employees,
officers, consultants or directors of the Corporation or an Affiliate as the
result of a merger or consolidation of the employing entity with the
Corporation or an Affiliate, or the acquisition by the Corporation or an
Affiliate of the assets or stock of the employing entity. The terms and
conditions of any substitute Awards so granted may vary from the terms and
conditions set forth herein to the extent that the Administrator deems
appropriate at the time of grant to conform the substitute Awards to the
provisions of the awards for which they are substituted.

     (f)  Termination, Amendment and Modification of the Plan. The
Administrator may terminate, amend or modify the Plan or any portion thereof at
any time; provided however, that the provisions of Section 6(a) relating to
stock option repricing shall not be amended without approval by the
Corporation’s stockholders, and any amendments to the Plan will not (i)
materially increase the benefits accruing to participants under the Plan, (ii)
materially increase the aggregate number of

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securities that may be issued under the Plan, (iii) materially modify the
requirements as to eligibility for participation in the Plan, without approval
by the Corporation’s stockholders.

     (g)  Non-Guarantee of Employment or Service. Nothing in the Plan or in any
Grant Agreement thereunder shall confer any right on an individual to continue
in the service of the Corporation or shall interfere in any way with the right
of the Corporation to terminate such service at any time with or without cause
or notice. The Corporation expressly reserves the right at any time to dismiss
an Award recipient free from any liability or claim under the Plan, except as
expressly provided in the applicable Grant Agreement.

     (h)  No Trust or Fund Created. Neither the Plan nor any Award shall create
or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Corporation and a grantee or any other person. To the
extent that any grantee or other person acquires a right to receive payments
from the Corporation pursuant to an Award, such right shall be no greater than
the right of any unsecured general creditor of the Corporation.

     (i)  Designated Beneficiaries. Unless otherwise provided in the applicable
Grant Agreement, amounts or certificates due an Award recipient after his or
her death under an Award shall be paid or delivered to the Award recipient’s
Designated Beneficiary in accordance with the terms and conditions of the
Award.

     (j)  Governing Law. The validity, construction and effect of the Plan, of
Grant Agreements entered into pursuant to the Plan, and of any rules,
regulations, determinations or decisions made by the Administrator relating to
the Plan or such Grant Agreements, and the rights of any and all persons having
or claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the
State of Maryland, without regard to its conflict of laws principles.

     (k)  Effective Date; Termination Date. The Plan is effective as of the
date on which the Plan is approved by the stockholders of the Corporation.
Prior to such approval, Awards may be made under the Plan expressly subject to
such approval but any such Awards shall be void and ineffective if the Plan is
not approved by the stockholders. The Plan shall be unlimited in duration and,
in the event of Plan termination, shall remain in effect as long as any Awards
under it are outstanding; provided, however, that no Awards shall be granted
under the Plan after the close of business on April 24, 2012.

24<PAGE>

                                                                   EXHIBIT 10(a)

             Schedule of Certain Executive Officers who are Parties
              to the Severance Pay Agreements in the Forms Attached
         as Exhibit 10(b) to the Company's Quarterly Report on Form 10-Q
                       For the Period Ended June 30, 1997

                         ------------------------------

Form A of Severance Pay Agreement
---------------------------------

Christopher M. Connor
Joseph M. Scaminace

Form B of Severance Pay Agreement
---------------------------------

John L. Ault
Sean P. Hennessy
Thomas E. Hopkins
Conway G. Ivy
John G. Morikis
Ronald P. Nandor
Thomas W. Seitz
Louis E. Stellato

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