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exv10w1

EXHIBIT 10.1

EDAC TECHNOLOGIES CORPORATION

2011 EQUITY INCENTIVE PLAN

Section 1. Purpose

     The purpose of the EDAC Technologies Corporation 2011 Equity Incentive Plan (the “2011
Plan”) is to attract and retain employees and directors to provide an incentive for them to
assist EDAC Technologies Corporation (the “Corporation”) to achieve its long-range
performance goals, and to enable them to participate in the long-term growth of the Corporation.

Section 2. Definitions

	(a)	 	“Award” means any Option or Restricted Stock awarded under the 2011 Plan.
	 
	(b)	 	“Board” means the Board of Directors of the Corporation.
	 
	(c)	 	“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the
regulations promulgated thereunder.
	 
	(d)	 	“Committee” means the Compensation Committee of the Board, or such other committee of not
less than two members of the Board appointed by the Board to administer the 2011 Plan,
provided that the members of such Committee must be Non-Employee Directors as defined in Rule
16b-3(b) promulgated under the Securities Exchange Act of 1934, as amended.
	 
	(e)	 	“Common Stock” or “Stock” means the Common Stock, par value $0.0025 per share, of the
Corporation.
	 
	(f)	 	“Corporation” means EDAC Technologies Corporation
	 
	(g)	 	“Designated Beneficiary” means the beneficiary designated by a Participant, in a manner
determined by the Board, to receive amounts due or exercise rights of the Participant in the
event of the Participant’s death. In the absence of an effective designation by a
Participant, Designated Beneficiary shall mean the Participant’s estate.
	 
	(h)	 	“Director” means any non-employee member of the Board.
	 
	(i)	 	“Fair Market Value” means with respect to Common Stock on any given date, the closing sales
price of one share of Common Stock for such date (or, in the event that the Common Stock is
not traded on such date, on the immediately preceding trading date) on a national securities
exchange (including the NASDAQ Capital Market) on which the Common Stock may be listed, as
reported by such national securities exchange. If the Common Stock is not listed on a
national securities exchange, but is quoted on the OTC

 

 

	 	 	Bulletin Board or similar regulated quotation service, the Fair Market Value of the Common
Stock shall be the mean of the bid and asked prices per share of the Common Stock for such
date. If the Common Stock is not quoted or listed as set forth above, Fair Market Value
shall be determined by the Board in good faith by any fair and reasonable means established
by the Board from time to time (which means may be set forth with greater specificity in the
applicable written document granting such Award). The Fair Market Value of property other
than Common Stock shall be determined by the Board in good faith by any fair and reasonable
means established by the Board from time to time.

	(j)	 	“Incentive Stock Option” means an option to purchase shares of Common Stock, awarded to a
Participant under Section 6, which is intended to meet the requirements of Section 422 of the
Code or any successor provision.
	 
	(k)	 	“Nonqualified Stock Option” means an option to purchase shares of Common Stock, awarded to a
Participant under Section 6, which is not intended to be an Incentive Stock Option.
	 
	(l)	 	“Option” means an Incentive Stock Option or a Nonqualified Stock Option.
	 
	(m)	 	“Participant” means a person selected by the Board to receive an Award under the 2011 Plan.
	 
	(n)	 	“Restricted Period” means the period of time selected by the Board during which an award of
Restricted Stock may be forfeited to the Corporation.
	 
	(o)	 	“Restricted Stock” means shares of Common Stock subject to forfeiture, awarded to a
Participant under Section 7.

Section 3. Administration

     The Board shall have the responsibility to administer the 2011 Plan. However, the Board may
designate the Committee to administer the 2011 Plan on its behalf. The Board, or if designated,
the Committee, shall have authority to adopt, alter and repeal such administrative rules,
guidelines and practices governing the operation of the 2011 Plan as it shall from time to time
consider advisable, and to interpret the provisions of the 2011 Plan. The Board’s decisions shall
be final and binding. To the extent permitted by applicable law and permitted to meet the
requirements of Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as amended, the
Board may delegate to the Committee the power to make Awards to Participants and all determinations
under the 2011 Plan with respect thereto.

Section 4. Eligibility

     All employees and, in the case of Awards other than Incentive Stock Options, Directors of the
Corporation capable of contributing significantly to the successful performance of the Corporation
are eligible to be Participants in the 2011 Plan.

 

 

Section 5. Stock Available for Awards

	(a)	 	Subject to adjustment under subsection (b), Awards may be made under the 2011 Plan of up to a
maximum of 200,000 shares of Common Stock; provided, however, that (i) in no event shall
grants of Options under the 2011 Plan exceed 150,000 shares of Common Stock, and (ii) in no
event shall grants of Restricted Stock under the 2011 Plan exceed 50,000 shares of Common
Stock. If any Award in respect of shares of Common Stock granted under the 2011 Plan expires,
terminates, is terminated unexercised or is forfeited for any reason or settled in a manner
that results in fewer shares outstanding than were initially awarded, including without
limitation the surrender of shares in payment for the Award or any tax obligation thereon, the
shares subject to such Award or so surrendered, as the case may be, to the extent of such
expiration, termination, forfeiture or decrease, shall again be available for award under the
2011 Plan, subject, however, in the case of Incentive Stock Options, to any limitation
required under the Code. Common Stock issued through the assumption or substitution of
outstanding grants from an acquired corporation shall not reduce the shares available for
Awards under the 2011 Plan. Shares issued under the 2011 Plan may consist in whole or in part
of authorized but unissued shares or treasury shares.
	 
	(b)	 	In the event that the Board determines that any stock dividend, extraordinary cash dividend,
creation of a class of equity securities, recapitalization, stock split, reverse stock split,
reclassification, reorganization, merger, consolidation, split-up, spin-off, liquidation,
combination, exchange of shares, warrants or rights offering to purchase Common Stock at a
price substantially below fair market value, or other similar transaction affects the Common
Stock such that an adjustment is required in order to preserve the benefits or potential
benefits intended to be made available under the 2011 Plan, then the Board, subject, in the
case of Incentive Stock Options, to any limitation required under Section 422 of the Code, and
with respect to other Options, any applicable requirements of Section 409A of the Code, shall
equitably adjust any or all of (i) the number and kind of shares in respect of which Awards
may be made under the 2011 Plan, (ii) the number and kind of shares subject to outstanding
Awards, and (iii) the award, exercise or conversion price with respect to any of the
foregoing, and if considered appropriate, the Board may make provision for a cash payment with
respect to an outstanding Option, provided that the number of shares subject to any Option
shall always be a whole number.

Section 6. Stock Options

	(a)	 	Subject to the provisions of the 2011 Plan, the Board may award Incentive Stock Options and
Nonqualified Stock Options and determine the number of shares to be covered by each Option,
the option price therefor and the conditions and limitations applicable to the exercise of the
Option. The terms and conditions of Incentive Stock Options shall be subject to and comply
with Section 422 of the Code, or any successor provision, and any regulations thereunder.

 

 

	(b)	 	The Board shall establish the option price at the time each Option is awarded, which price
shall not be less than 100% of the Fair Market Value of the Common Stock on the date of award
with respect to such Option.
	 
	(c)	 	Each Option shall be exercisable at such times and subject to such terms and conditions as
the Board may specify in the applicable Award or thereafter. The Board may impose such
conditions with respect to the exercise of Options, including conditions relating to
applicable federal or state securities laws, as it considers necessary or advisable.
	 
	(d)	 	No shares shall be delivered pursuant to any exercise of an Option until payment in full of
the option price therefore is received by the Corporation. Such payment may be made in whole
or in part in cash or, to the extent permitted by the Board at or after the award of the
Option, by delivery of shares of Common Stock owned by the option holder, valued at their Fair
Market Value on the date of delivery, by the reduction of the shares of Common Stock that the
optionholder would be entitled to receive upon exercise of the Option, such shares to be
valued at their Fair Market Value on the date of exercise, less their option price (a
so-called “cashless exercise”), or such other lawful consideration as the Board may determine.
	 
	(e)	 	In the case of Incentive Stock Options the following additional conditions shall apply to the
extent required under Section 422 of the Code for the options to qualify as Incentive Stock
Options:

	 	(i)	 	Such options shall be granted only to employees of the Corporation, and shall
not be granted to any person who owns stock that possesses more than ten percent of the
total combined voting power of all classes of stock of the Corporation or of its parent
or subsidiary corporation (as those terms are defined in Section 422(b) of the Code),
unless, at the time of such grant, the exercise price of such option is at least 110%
of the fair market value of the stock that is subject to such option and the option
shall not be exercisable more than five years after the date of grant;
	 
	 	(ii)	 	Such options shall, by their terms, be transferable by the optionholder only by
the laws of descent and distribution, and shall be exercisable only by such
optionholder during his lifetime.
	 
	 	(iii)	 	Such options shall not be granted more than ten years from the effective date
of the 2011 Plan or any subsequent amendment to the 2011 Plan approved by the
stockholders of the Corporation which extends this Incentive Stock Option expiration
date, and shall not be exercisable more than ten years from the date of grant.
	 
	 	(iv)	 	Notwithstanding other provisions hereof, the aggregate Fair Market Value
(determined at the time the Incentive Stock Option is granted) of the Common Stock with
respect to which Incentive Stock Options are exercisable for the first time by the
employee during any calendar year (under all such plans of the
employee’s employer corporation and its parent and subsidiary corporations) shall
not exceed $100,000.

 

 

Section 7. Restricted Stock

	(a)	 	Subject to the provisions of the Plan, the Board may award shares of Restricted Stock and
determine the duration of the Restricted Period during which, and the conditions under which,
the shares may be forfeited to the Corporation and the other terms and conditions of such
Awards. Shares of Restricted Stock may be issued for no cash consideration or such minimum
consideration as may be required by applicable law.
	 
	(b)	 	Shares of Restricted Stock may not be sold, assigned, transferred, pledged or otherwise
encumbered, except as permitted by the Board, during the Restricted Period. Shares of
Restricted Stock shall be evidenced in such manner as the Board may determine. Any
certificates issued in respect of shares of Restricted Stock shall be registered in the name
of the Participant and unless otherwise determined by the Board, deposited by the Participant,
together with a stock power endorsed in blank, with the Corporation. At the expiration of the
Restricted Period, the Corporation shall deliver such certificates to the Participant or, if
the Participant has died, to the Participant’s Designated Beneficiary.
	 
	(c)	 	Any Participant who receives an award of Restricted Stock shall have the right to make an
election to treat such Restricted Stock as income pursuant to Section 83(b) of the Code and
the Corporation shall provide the Participant with such information and take such actions as
shall be necessary to make such election available to the Participant.

Section 8. General Provisions Applicable to Awards

	(a)	 	Documentation. Each Award under the 2011 Plan shall be evidenced by a written
document delivered to the Participant specifying the terms and conditions thereof and
containing such other terms and conditions not inconsistent with the provisions of the 2011
Plan as the Board considers necessary or advisable to achieve the purposes of the 2011 Plan or
comply with applicable tax and regulatory laws and accounting principles. If such written
document evidences an Award of Options, it shall specify whether such Options are intended to
be Nonqualified Stock Options or Incentive Stock Options, and in the absence of such
specification such Options shall be deemed Nonqualified Stock Options.
	 
	(b)	 	Board Discretion. Each type of Award may be made alone, in addition to or in
relation to any other type of Award. The terms of each type of Award need not be identical,
and the Board need not treat Participants uniformly. Except as otherwise provided by the 2011
Plan or a particular Award, any determination with respect to an Award may be made by the
Board at the time of award or at any time thereafter.
	 
	(c)	 	Settlement. If shares of Common Stock are to be used in payment pursuant to an Award
and such shares were acquired upon the exercise of a stock option (whether or not
granted under the 2011 Plan), such shares must have been held by the Participant for at
least six months.

 

 

	(d)	 	Dividends and Cash Awards. In the discretion of the Board, except as may be required
for any Options to remain exempt from the provisions of Section 409A of the Code or meet the
requirements of Section 422 of the Code, whichever is applicable, any Award under the Plan may
provide the Participant with (i) dividends or dividend equivalents payable currently or
deferred with or without interest, and (ii) cash payments in lieu of or in addition to an
Award.
	 
	(e)	 	Termination of Employment. The Board shall determine the effect on an Award of the
disability, death, retirement or other termination of employment of a Participant and the
extent to which, and the period during which, the Participant’s legal representative, guardian
or Designated Beneficiary may receive payment of an Award or exercise rights thereunder.
	 
	(f)	 	Change in Control. In order to preserve a Participant’s rights under an Award in the
event of a change in control of the Corporation, as defined in Treasury Regulation Section
1.409A-3(i)(5)(i), the Board in its discretion may, at the time an Award is made or at any
time thereafter, take one or more of the following actions: (i) provide for the acceleration
of any time period relating to the exercise or realization of the Award, (ii) provide for the
purchase of the Award upon the Participant’s request for an amount of cash or other property
that could have been received upon the exercise or realization of the Award had the Award been
currently exercisable or payable, (iii) adjust the terms of the Award in a manner determined
by the Board to reflect the change in control, (iv) cause the Award to be assumed, or new
rights substituted therefore, by another entity, or (v) make such other provision as the Board
may consider equitable and in the best interests of the Corporation. Notwithstanding the
foregoing, any change in Incentive Stock Options shall comply with the rules under Section 424
of the Code and no change may be made to any Award which would make the Award subject to the
provisions of Section 409A of the Code.
	 
	(g)	 	Withholding. The Corporation shall have the power and the right to deduct or
withhold, or require a Participant to remit to the Corporation an amount sufficient to satisfy
federal, state and local taxes (including the Participant’s FICA obligation) required to be
withheld with respect to an Award or any dividends or other distributions payable with respect
thereto. In the Board’s discretion, such tax obligations may be paid in whole or in part in
shares of Common Stock, including shares retained from the Award creating the tax obligation,
valued at their Fair Market Value on the date of delivery. The Corporation may, to the extent
permitted by law, deduct any such tax obligations from any payment of any kind otherwise due
to the Participant.
	 
	(h)	 	Amendment of Award. The Board may amend, modify or terminate any outstanding Award,
including substituting therefor another Award of the same or a different type, changing the
date of exercise or realization and converting an Incentive Stock Option to a Nonqualified
Stock Option, provided that the Participant’s consent to such action shall be
required unless the Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.

 

 

	(i)	 	Transfer. Except as otherwise provided by the Board, Awards under the 2011 Plan are
not transferable other than as designated by the Participant by will or by the laws of descent
and distribution.
	 
	(j)	 	Compliance with Section 409A of the Code. To the extent applicable, the 2011 Plan is
intended to be operated in good faith compliance with the exemptions applicable under Section
409A of the Code and its accompanying regulations, and any additional guidance issued under
Section 409A. To the extent that any provision of the 2011 Plan violates the exemptions
available under Section 409A, such provision shall be deemed inoperative and the remaining
provisions of the 2011 Plan shall continue to be fully effective.

Section 9. Miscellaneous

	(a)	 	No Right to Employment. No person shall have any claim or right to be granted an
Award, and the grant of an Award shall not be construed as giving a Participant the right to
continued employment. The Corporation expressly reserves the right at any time to dismiss a
Participant free from any liability or claim under the 2011 Plan, except as expressly provided
in the applicable Award.
	 
	(b)	 	No Rights as Shareholder. Subject to the provisions of the applicable Award, no
Participant or Designated Beneficiary shall have any rights as a shareholder with respect to
any shares of Common Stock to be distributed under the 2011 Plan until he or she becomes the
holder thereof. A Participant to whom Common Stock is awarded shall be considered the holder
of the Stock at the time of the Award except as otherwise provided in the applicable Award.
	 
	(c)	 	Effective Date and Duration of the 2011 Plan. The 2011 Plan was adopted by the Board
and stockholders of the Corporation and became effective on April 27, 2011. Unless earlier
terminated by the Board, the 2011 Plan shall terminate on April 27, 2021.
	 
	(d)	 	Amendment of 2011 Plan. The Board may amend, suspend or terminate the 2011 Plan or
any portion thereof at any time, without shareholder approval, provided that no amendment
shall be made without shareholder approval if such approval is necessary to comply with any
applicable requirement of the laws of the jurisdiction of incorporation of the Corporation,
any applicable tax requirement, including Section 422 of the Code, any applicable rules or
regulation of the Securities and Exchange Commission, including Rule 16b-3 (or any successor
rule thereunder), or the rules and regulations of NASDAQ or any other exchange or stock market
over which the Corporation’s securities are listed. No amendment shall be made where such
amendment increases the total number of shares of Common Stock reserved for issuance of Awards
or reduces the minimum exercise price for options or exchange of options for other Awards,
unless such change is authorized by the shareholders within one year.

 

 

	(e)	 	Governing Law. The provisions of the 2011 Plan shall be governed by and interpreted
in accordance with the laws of the jurisdiction of incorporation of the Corporation.
	 
	(f)	 	Indemnity. Neither the Board nor the Committee, nor any members of either, nor any
employees of the Corporation or any parent, subsidiary, or other affiliate, shall be liable
for any act, omission, interpretation, construction or determination made in good faith in
connection with their responsibilities with respect to the 2011 Plan, and the Corporation
hereby agrees to indemnify the members of the Board, the members of the Committee, and the
employees of the Corporation and its parent or subsidiaries in respect of any claim, loss,
damage, or expense (including reasonable counsel fees) arising from any such act, omission,
interpretation, construction or determination to the full extent permitted by law.exv10w1

EXHIBIT 10.1

NONQUALIFIED STOCK OPTION AGREEMENT (Employee)

Community Health Systems, Inc.

2009 Stock Option and Award Plan

     THIS AGREEMENT between you and Community Health Systems, Inc., a Delaware corporation (the
“Company”) governs an award of a nonqualified stock option on a date specified in your award
notification (the “Grant Date”), and

     WHEREAS, the Company has adopted the Community Health Systems, Inc. 2009 Stock Option and
Award Plan (the “Plan”) in order to provide additional incentive to certain employees, officers and
directors of the Company and its Subsidiaries; and

     WHEREAS, the Compensation Committee of the Company’s Board of Directors (the “Committee”) has
determined to grant an option to you as provided herein;

     NOW, THEREFORE, the parties hereto agree as follows:

     1. Grant of Option.

          1.1 The Company hereby grants to you the right and option (the “Option”) to purchase all or
any part of an aggregate of the number of whole Shares (such number being subject to adjustment as
provided in Section 10 hereof) set out in your Award notification, on the terms and conditions set
forth in this Agreement and in the Plan, a copy of which is available to you from the Company by
request. The Company may delegate any of the duties associated with the administration of the Plan
or this agreement to one or more affiliates or third-party vendors (the “Plan Administrator”).

          1.2 This Option is not intended to qualify as an Incentive Stock Option within the meaning of
Section 422 of the Code.

          1.3 Except as otherwise defined herein, capitalized terms used in this Agreement shall have
the same definitions as set forth in the Plan.

     2. Purchase Price.

          The price at which you shall be entitled to purchase Shares upon the exercise of this Option
shall be the close price of the Company’s stock on the Grant Date, as reported in The Wall Street
Journal, and as set out in your award notification (such price being subject to adjustment as
provided in Section 10 hereof).

     3. Duration of Option.

          The Option shall be exercisable to the extent and in the manner provided herein for a period
of ten (10) years from the date hereof (the “Exercise Term”); provided, however, that the Option
may be earlier terminated as provided in Section 6 or Section 8 hereof; provided, further, that the
Option may, upon your death, be later
exercised for up to one (1) year following the date of your death if such death occurs prior to the
tenth anniversary of the Grant Date.

 

 

     4. Exercisability of Option.

          Unless otherwise provided in this Agreement or the Plan, the Option shall entitle you to
purchase, in whole at any time or in part from time to time, thirty-three and one-third percent (33
1/3%) of the total number of Shares subject to the Option after the expiration of one (1) year from
the Grant Date and an additional thirty-three and one-third percent (33 1/3%) of the total number
of Shares subject to the Option after the expiration of each of the second and third anniversaries
of the Grant Date, and each such right of purchase shall be cumulative and shall continue, unless
sooner exercised or terminated as herein provided, during the remaining period of the Exercise
Term. Any fractional number of Shares resulting from the application of the foregoing percentages
shall be rounded down to the next whole number of Shares.

     5. Manner of Exercise and Payment.

          5.1 Election to Exercise. Subject to the terms and conditions of this Agreement and
the Plan, the Option may be exercised by electronic notification to the Company’s Plan
Administrator, or by telephonic request (each as subject to the Company’s Insider Trading Policy).
Such notification shall state that you are electing to exercise the Option and the number of
Shares in respect of which the Option is being exercised. In the event of your death, such
notification shall be in the form prescribed by the Company or its Plan Administrator and shall be
signed by your legal guardian, executor, administrator or other legal representative. The Company
or its Administrator may require proof satisfactory to it as to the right of such person to
exercise the Option.

          5.2 Deliveries. The notification of exercise described in Section 5.1 hereof shall be
accompanied by the full purchase price for the Shares in respect of which the Option is being
exercised, in cash or by check or, if acceptable to the Plan Administrator, such payment shall
follow by check from a registered broker acting as agent on your behalf. However, at the
discretion of the Committee, you may pay the exercise price in part or in full by transferring to
the Company Shares owned by you for a period of six (6) months (or such lesser period as may be
permitted by the Committee) prior to the exercise of the Option. In addition, an Option may be
exercised through the Company’s Plan Administrator pursuant to its cashless exercise procedures
which may be deemed acceptable by the Committee from time to time. Any Shares transferred to the
Company in payment of the exercise price under an Option shall be valued at their Fair Market Value
on the date of exercise of such Option.

          5.3 Issuance of Shares. Upon your election to exercise your options, following
receipt of full payment for the Shares underlying the Option, and subject to Section 11, the
Company or its Plan Administrator shall take such action as may be necessary under applicable law
to affect the issuance to you of the number of Shares so exercised.

          5.4 Stockholder Rights. You shall not be deemed to be the holder of, or to have any
of the rights of a holder with respect to any Shares subject to the Option until (a) the Option
shall have been exercised in accordance with the terms of this Agreement and you shall have paid
the full purchase price for the number of Shares in
respect of which the Option was exercised, and any withholding taxes due in connection with such
exercise, (b) the Company or its Plan Administrator shall have issued the Shares to you, and (c)
your name shall have been entered as a shareholder of record on

 

 

the books of the Company. Upon the
occurrence of all of the foregoing events, you shall have full voting and other ownership rights
with respect to such Shares.

     6. Termination of Option. Subject to Sections 7 and 8 hereof, each Option shall
terminate on the date which is the tenth anniversary of the Grant Date (or if later, the first
anniversary of the date of your death if such death occurs prior to such tenth anniversary), unless
terminated earlier as follows:

          6.1 If your employment is terminated for any reason other than disability, death or for Cause,
you may for a period of three (3) months after such termination exercise your Option to the extent,
and only to the extent, that the Option or portion thereof was vested and exercisable as of the
date of such termination, after which time the Option shall automatically terminate in full.

          6.2 If your employment is terminated by reason of Disability, all of the Option shall
immediately become vested and exercisable and you may, for a period of twelve (12) months after
such termination, exercise your Option, after which time the Option shall automatically terminate
in full.

          6.3 If your employment is terminated by reason of your death, or if you die within three (3)
months after termination as described in Section 6.1 hereof the Option shall immediately become
vested and exercisable and the person or persons to whom such rights under the Option shall pass by
will, or by the laws of descent or distribution may, for a period of twelve (12) months following
your death, exercise the Option, after which time the Option shall terminate in full.

          6.4 If your the employment is terminated for Cause, the option granted to you hereunder shall
immediately terminate in full and no rights thereunder may be exercised.

          6.5 Except as expressly provided herein to the contrary, the Option, to the extent not yet
vested and exercisable, shall terminate immediately upon the Employee’s termination of employment
with the Company for any reason.

     7. Effect of Change of Control.

          In the event of a Change in Control, the Option shall become immediately and fully vested and
exercisable and shall, notwithstanding any shorter period set forth in this Agreement, remain
exercisable for a period ending not before the earlier of (x) the six (6) month anniversary of the
termination of your employment or (y) the expiration of the Exercise Term.

     8. Prohibited Activities

          8.1 Prohibition Against Certain Activities. You agree that (a) you will not at any
time during your employment (other than in the course of your employment) with the Company or any
Affiliate thereof, or after any termination of employment, directly or indirectly disclose or
furnish to any other person or use for your own or any
other person’s account any confidential or proprietary knowledge or any other information which is
not a matter of public knowledge obtained during the course of your employment with, or other
performance of services for (including service as a director

 

 

of), the Company or any Affiliate
thereof or any predecessor of any of the foregoing, no matter from where or in what manner you may
have acquired such knowledge or information, and you shall retain all such knowledge and
information in trust for the benefit of the Company, its Affiliates and the successors and assigns
of any of them, (b) you will not at any time during your employment with the Company or any
Affiliate thereof, or for three (3) years following any termination of employment, directly or
indirectly solicit for employment, including, without limitation, recommending to any subsequent
employer the solicitation for employment of, any person who at the time of the solicitation is
employed by the Company or any Affiliate thereof, (c) you will not at any time during your
employment with, or performance of services for (including service as a director of), the Company
or any Affiliate thereof or after any termination of employment, publish any statement or make any
statement (under circumstances reasonably likely to become public or that might reasonably be
expected to become public) critical of the Company or any Affiliate of the Company, or in any way
adversely affecting or otherwise maligning the business reputation of any of the foregoing
entities, and (d) you will not breach the provisions of Section 9 hereof (any activity described in
clause (a), (b), (c) or (d) of this Section 8.1 being herein referred to as a “Prohibited
Activity”).

          8.2 Right to Terminate Option. You understand that the Company is granting to you an
option to purchase Shares hereunder to reward you for your future efforts and loyalty to the
Company and its Affiliates by giving you the opportunity to participate in the potential future
appreciation of the Company. Accordingly, if, at any time during which any portion of the Option,
including any exercisable portion, is outstanding (a) if you engage in any Prohibited Activity, or
(b) you engage in any Competitive Activity (as hereinafter defined), or (c) you are convicted of a
crime against the Company or any of its Affiliates, then, in addition to any other rights and
remedies available to the Company, the Company shall be entitled, at its option, to terminate the
Option, including any exercisable portion thereof, which shall then be of no further force and
effect.

     The term “Competitor” shall mean any person that competes either directly or indirectly
through one or more Affiliates with any of the businesses in which, at the time your employment is
terminated, the Company or any of its subsidiaries is engaged.

     The term “Competitive Activity” shall mean engaging in any of the following activities: (i)
serving as a director of any Competitor; (ii) directly or indirectly (x) controlling any Competitor
or (y) owning any equity or debt interests in any Competitor (other than equity or debt interests
which are publicly traded and do not exceed 2% of the particular class of interests outstanding)
(it being understood that, if any such interests in any Competitor are owned by an investment
vehicle or other entity in which you own an equity interest, a portion of the interests in such
Competitor owned by such entity shall be attributed to you, such portion determined by applying the
percentage of the equity interest in such entity owned by you to the interests in such Competitor
owned by such entity); (iii) directly or indirectly soliciting, diverting, taking away,
appropriating or otherwise interfering with any of the customers or suppliers of the Company or any
Affiliate of the Company; (iv) employment by (including serving as an officer or director of) or
providing consulting services to any Competitor; provided, however, that if the
Competitor has more than one discrete and readily distinguishable part of its business, employment
by or providing consulting services to any Competitor shall be Competitive Activity only if (1)
your employment duties are at or involving the part of the Competitor’s

 

 

business that competes with
any of the businesses conducted by the Company or any of its subsidiaries (the “Competing
Operations”), including serving in a capacity where any person at the Competing Operations reports
to you, or (2) the consulting services are provided to or involve the Competing Operations. For
purposes of this definition, the term “control” means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of any Competitor,
whether through the ownership of equity or debt interests, by contract or otherwise.

     9. Non-Transferability.

          The Option shall not be transferable other than by will or by the laws of descent and
distribution or pursuant to a domestic relations order; provided, however, that the Option may be
transferred to members of your immediate family, to trusts solely for the benefit of such immediate
family members and to partnerships in which such family members and/or trusts are the only
partners. For this purpose, immediate family means your spouse, parents, children, stepchildren
and grandchildren and the spouses of such parents, children, stepchildren and grandchildren.

     10. Adjustments.

          In the event of a Change in Capitalization, the Committee may make appropriate adjustments to
the number and class of Shares or other stock or securities subject to this Option and the purchase
price for such Shares or other stock or securities (an “Adjustment”). In the event of (i) the
liquidation or dissolution of the Company or (ii) a merger or consolidation of the Company (a
“Transaction”), any such Adjustment may be as provided for in the plan or agreement of liquidation,
dissolution, merger or consolidation. If such plan or agreement does not expressly provide for the
treatment of the Option in connection with the Transaction, the Option shall continue in effect in
accordance with its terms and you shall be entitled to receive in respect of all Shares subject to
the Option, upon exercise of the Option, the same number and kind of stock, securities, cash,
property or other consideration that each holder of Shares was entitled to receive in the
Transaction. The Committee’s Adjustment shall be final and binding for all purposes of the Plan
and the Agreement. No Adjustment provided for in this Section 10 shall require the Company to
issue a fractional Share, and the total adjustment with respect to this Agreement shall be limited
accordingly.

     11. Withholding.

          The Company or its Plan Administrator shall have the right to deduct from any amounts payable
under this Agreement an amount equal to the federal, state and local income taxes and other amounts
as may be required by applicable law to be withheld (the “Withholding Taxes”). If you are entitled
to receive Shares upon exercise of the Option, you shall pay the Withholding Taxes to the Company
or its Plan Administrator in cash prior to the issuance of such Shares. In satisfaction of the
Withholding Taxes, you may, unless the Committee determines otherwise, elect to have withheld a
portion of the Shares issuable to you upon exercise of the Option having an aggregate Fair Market
Value equal to the Withholding Taxes.

 

 

12. No Right to Continued Employment.

          This Agreement and the Option shall not confer upon you any right with respect to continuance
of employment by the Company or any Affiliate thereof, nor shall it interfere in any way with the
right of the Company or any Affiliate thereof to terminate your employment at any time.

     13. Entire Agreement.

          This Agreement and the Plan constitute the entire agreement, and supersede all prior
agreements and understandings, oral and written, between the parties hereto with respect to the
subject matter hereof.

     14. Acceptance of the Terms of this Agreement; Deemed Execution; Modification of
Agreement.

          The terms of this Agreement must be acknowledged and accepted by you by electronic means via
the Plan Administrator’s website, and upon such acceptance shall be deemed to have been executed
and delivered by you and the Company. This Agreement may be modified, amended, supplemented or
terminated by written agreement of the parties hereto; provided that the Company may modify, amend,
supplement or terminate this Agreement in a writing signed by the Company without any further
action by you if such modification, amendment, supplement or termination does not adversely affect
your rights hereunder.

     15. Invalidity of Provisions.

          The invalidity or unenforceability of any provision of this Agreement in any jurisdiction
shall not affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of this Agreement, including that provision, in any
other jurisdiction. If any provision of this Agreement is held unlawful or unenforceable in any
respect, such provision shall be revised or applied in a manner that renders it lawful and
enforceable to the fullest extent possible.

     16. Acknowledgment.

          You hereby acknowledge the availability of a copy of the Prospectus, the Plan and this
Agreement via the Plan Administrator’s website, and agree to be bound by all the terms and
provisions of each, and by the Company’s Insider Trading Policy, as each may be amended from time
to time. You hereby acknowledge that you have reviewed these documents and understand your rights
and obligations thereunder and hereunder. You also acknowledge that you have been provided with
such information concerning the Company, the Plan, the Prospectus, the Plan Administrator and this
Agreement as you and your advisors have requested. You also acknowledge your right to request a
copy of any of the foregoing from the Company.

     17. Binding Effect.

          This Agreement shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, legal representatives, successors and assigns.

 

 

     18. Headings.

          The headings and captions contained herein are for convenience only and shall not control or
affect the meaning or construction of any provision hereof.

     19. Resolution of Disputes.

          Any dispute or disagreement which may arise under, or as a result of, or in any way relate to,
the interpretation, construction or application of this Agreement shall be determined by the
Committee in good faith, whose determination shall be final, binding and conclusive for all
purposes.

     20. Governing Law.

          This Agreement and the rights and obligations of the parties hereto shall be governed by, and
construed in accordance with, the laws of the State of Delaware without giving effect to the
principles of conflicts of laws thereof.

     21. Specific Performance.

          The parties hereto acknowledge that there will be no adequate remedy at law for a violation of
any of the provisions of this Agreement and that, in addition to any other remedies which may be
available; all of the provisions of this Agreement shall be specifically enforceable in accordance
with their respective terms.

     22. Notice.

          All notifications and other communications hereunder shall be in writing and, unless otherwise
provided herein, shall be deemed to have been given when received by the party to whom such notice
is to be given at its address set forth below, or such other address for the party as shall be
specified by notice given pursuant hereto:

	 	(a)	 	If to the Company, by regular mail to:
	 
	 	 	 	Community Health Systems, Inc.

4000 Meridian Boulevard

Franklin, TN 37067

Attention: General Counsel

          (b) If to you or your legal representative, to such person at the address as reflected in the
records of the Company.

     23. Consent to Jurisdiction.

          Each party hereby irrevocably and unconditionally consents to submit to the exclusive
jurisdiction of the courts of the State of Tennessee and of the United States of America, in each
case located in the County of Williamson, for any actions, suits or proceedings arising out of or
relating to this Agreement, the Option or the Plan and the transactions contemplated hereby and
thereby (“Litigation”) (and agrees not to commence any Litigation except in any such court), and
further agrees that service of process, summons, notice or document by U.S. registered mail to such
party’s

 

 

respective address set forth in Section 22 hereof shall be effective service of process for any
Litigation brought against such party in any such court. Each party hereby irrevocably and
unconditionally waives any objection to the laying of venue of any litigation in the courts of the
State of Tennessee or of the United States of America, in each case located in the County of
Williamson, and hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any Litigation brought in any such court has been brought in an
inconvenient forum.

	 	 	 	 	 
	 	COMMUNITY HEALTH SYSTEMS, INC.

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