Document:

Exhibit 10.35

Form for Non-Employee Director

 

Williams Scotsman International,
Inc.

2005 OMNIBUS AWARD PLAN

RESTRICTED STOCK UNIT AGREEMENT

THIS RESTRICTED STOCK
UNIT AGREEMENT (the “Agreement”), is made, effective as of the ____ day
of _____________ (hereinafter the “Date of Grant”), between Williams
Scotsman International, Inc., a Delaware corporation, (the “Company”),
and __________ (the “Participant”).

R E C I T A L S:

WHEREAS, the Company has
adopted the Williams Scotsman International, Inc. 2005 Omnibus Award Plan (the “Plan”),
pursuant to which awards of Restricted Stock Units may be granted; and

WHEREAS, the Compensation
Committee of the Board of Directors of the Company (the “Committee”) has
determined that it is in the best interests of the Company and its stockholders
to grant to the Participant an award of Restricted Stock Units as provided
herein and subject to the terms set forth herein.

NOW THEREFORE, for and in
consideration of the premises and the covenants of the parties contained in
this Agreement, and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties hereto, for themselves, their
successors and assigns, hereby agree as follows:

1.     Grant of Restricted Stock Units.  The Company hereby grants on the Date of
Grant, to the Participant a total of _____ Restricted Stock Units (the “Award”)
on the terms and conditions set forth in this Agreement and as otherwise
provided in the Plan.  Such Restricted Stock
Units shall be credited to a separate account maintained for the Participant on
the books of the Company (the “Account”).  On any given date, the value of each
Restricted Stock Unit comprising the Award shall equal the Fair Market Value of
one share of Common Stock.  The Award shall
vest and settle in accordance with Section 3 hereof.

2.     Incorporation by Reference, Etc.  The provisions of the Plan are hereby
incorporated herein by reference.  Except
as otherwise expressly set forth herein, this Agreement shall be construed in
accordance with the provisions of the Plan and any capitalized terms not
otherwise defined in this Agreement shall have the definitions set forth in the
Plan.  The Committee shall have final
authority to interpret and construe the Plan and this Agreement and to

 

 

make any and all
determinations under them, and its decision shall be binding and conclusive
upon the Participant and his legal representative in respect of any questions
arising under the Plan or this Agreement.

3.     Terms and Conditions.

(a)           Vesting and Settlement.  Except as otherwise provided in the Plan and
this Agreement, and contingent upon the Participant’s continued service to the
Company, one hundred percent (100%) of the Award shall vest and become
non-forfeitable on the date that is six months following the Date of Grant (the
“Vesting Date”).  On the Vesting
Date, the Company shall settle the Award and shall therefore (i) issue and
deliver to the Participant one share of Common Stock for each Restricted Stock Unit
subject to the Award (the “RSU Shares”) (and, upon such settlement, the
Restricted Stock Units shall cease to be credited to the Account) and (ii)
enter the Participant’s name as a stockholder of record with respect to the RSU
Shares on the books of the Company.

(b)           Restrictions.  The Award granted hereunder may not be sold,
pledged or otherwise transferred (other than by will or the laws of decent and
distribution) and may not be subject to lien, garnishment, attachment or other
legal process.  The Participant acknowledges
and agrees that, with respect to each Restricted Stock Unit credited to his
Account, he has no voting rights with respect to the Company unless and until each
such Restricted Stock Unit is settled in RSU Shares pursuant to Section 3(a)
hereof.

(c)           Effect of Termination of Services.

(i)              Except
as provided in subsections (ii) of this Section 3(c), if the Participant’s
service with the Company terminates prior to the Vesting Date for any reason,
the Award shall be forfeited without further consideration to the Participant.

(ii)           Upon the termination of Participant’s
service with the Company due to his death, the Award shall become one hundred
(100%) vested and non-forfeitable.

(d)           Dividends.  If any cash or in-kind dividends are paid with
respect to shares of Common Stock underlying the Award prior to the Vesting
Date, such cash or in-kind dividends shall be withheld by the Company and shall
be paid to the Participant without interest, upon the Vesting Date, as if each
Restricted Stock Unit were one share of Common Stock.

(e)           Restrictions on the RSU Shares.   While the Participant continues in the
service of the Company and for one year thereafter, he may not assign,
alienate, pledge, attach, sell or otherwise transfer or encumber (a “Transfer”)
the RSU Shares and any such purported assignment, alienation, pledge,
attachment, sale, transfer or encumberance shall be void and unenforceable
against the Company provided, that (i) the designation of a beneficiary
shall not constitute a Transfer and (ii) the Participant shall be permitted to
sell that number of RSU Shares having an aggregate Fair Market Value equal to
the amount of federal, state and local taxes incurred by the Participant as a
result of the vesting of the Award.  Notwithstanding
the foregoing provisions of this Section 3(e), if the Participant’s service
with the Company

 

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terminates on
account of his death, his estate or beneficiary, as applicable may at any time
following his death, Transfer the RSU Shares. 
In addition, after the Vesting Date, and following the consummation of an
initial public offering of the Company’s common stock, the RSU Shares may be
transferred by Participant without consideration, to (i) any person who is a “family
member” of Participant’s as such term is used in the instructions to Form S-8
(collectively, the “Immediate Family Members”); (ii) a trust solely for
the benefit of Participant and his Immediate Family Members; or (iii) any other
transferee as may be approved by the Committee in its sole discretion
(collectively, the “Permitted Transferees”); provided, that, Participant
gives the Committee advance written notice describing the terms and conditions
of the proposed transfer; and provided, further, that the restrictions upon any
portion of the RSU Shares transferred in accordance with this Section 3(e)
shall apply to the Permitted Transferee and any reference in this Agreement to
Participant shall be deemed to refer to the Permitted Transferee, except that
the consequences of the termination of Participant’s services to the Company
under the terms of this Agreement shall continue to be applied with respect to
the Permitted Transferee to the extent, and for the periods, specified in this
Agreement. Any transfer of the RSU Shares in contravention of the terms and
conditions of this Section 3(e) shall be null and void.

(f)            Taxes.  Upon the settlement of the Award in
accordance with Section 3(a) hereof, the Participant shall recognize taxable
income in respect of the Award and the Company shall report such taxable income
to the appropriate taxing authorities in respect of the Award as it determines
to be necessary and appropriate.

(g)           Rights as a Stockholder.  Upon and following the Vesting Date, the
Participant shall be the record owner of the RSU Shares unless and until such
shares are sold or otherwise disposed of, and as record owner shall be entitled
to all rights of a common stockholder of the Company subject to the
restrictions on Transfer set forth in Section 3(e) hereof, including, without
limitation, voting rights, if any, with respect to the shares.  Prior to the Vesting Date, the Participant
shall not be deemed for any purpose to be the owner of shares of Common Stock
subject to the Award.

(h)           Restrictive Legend.  All certificates representing the RSU Shares
shall have affixed thereto a legend in substantially the following form, in
addition to any other legends that may be required under federal or state
securities laws:

Transfer of this certificate and the shares
represented hereby is restricted pursuant to the terms of the Williams Scotsman
International, Inc. 2005 Omnibus Award Plan and a Restricted Stock Unit Agreement,
dated as of _____________, between Williams Scotsman International, Inc. and
__________________.  A copy of such Plan
and Agreement is on file at the offices of Williams Scotsman International,
Inc.

4.     Miscellaneous.

(a)           General Assets.  All amounts credited to the Account under
this Agreement shall continue for all purposes to be part of the general assets
of the Company,

 

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Participant’s interest in the Account shall make the
Participant only a general, unsecured creditor of the Company.

(b)           Notices.  All notices, demands and other communications
provided for or permitted hereunder shall be made in writing and shall be by
registered or certified first-class mail, return receipt requested, telecopier,
courier service or personal delivery:

if to the Company:

Williams Scotsman
International, Inc.

8211 Town Center Drive

Baltimore, Maryland
21236

Attention:
Secretary

if to the Participant, at
the Participant’s last known address on file with the Company.

All such notices,
demands and other communications shall be deemed to have been duly given when
delivered by hand, if personally delivered; when delivered by courier, if
delivered by commercial courier service; five business days after being
deposited in the mail, postage prepaid, if mailed; and when receipt is
mechanically acknowledged, if telecopied.

(c)           Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, and each other provision of this
Agreement shall be severable and enforceable to the extent permitted by law.

(d)           No Rights to Service.  Nothing contained in this Agreement shall be
construed as giving the Participant any right to be retained, in any position,
as a consultant or director of the Company or its Affiliates or shall interfere
with or restrict in any way the right of the Company or its Affiliates, which
are hereby expressly reserved, to remove, terminate or discharge the
Participant at any time for any reason whatsoever.

(e)           Bound by Plan.  By signing this Agreement, the Participant
acknowledges that he has received a copy of the Plan and has had an opportunity
to review the Plan and agrees to be bound by all the terms and provisions of
the Plan.

(f)            Beneficiary.  The Participant may file with the Committee a
written designation of a beneficiary on such form as may be prescribed by the Committee
and may, from time to time, amend or revoke such designation.  If no designated beneficiary survives the
Participant, the executor or administrator of the Participant’s estate shall be
deemed to be the Participant’s beneficiary.

(g)           Successors.  The terms of this Agreement shall be binding
upon and inure to the benefit of the Company, its successors and assigns, and
of the Participant and the beneficiaries, executors, administrators, heirs and
successors of the Participant.

 

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(h)           Entire Agreement.  This Agreement and the Plan contain the
entire agreement and understanding of the parties hereto with respect to the
subject matter contained herein and supersede all prior communications,
representations and negotiations in respect thereto.  No change, modification or waiver of any
provision of this Agreement shall be valid unless the same be in writing and
signed by the parties hereto.

(i)            Governing Law.  This
Agreement shall be construed and interpreted in accordance with the laws of the
State of Maryland without regard to principles of conflicts of law thereof, or
principals of conflicts of laws of any other jurisdiction which could cause the
application of the laws of any jurisdiction other than the State of Maryland.

(j)            Headings.  The headings of the Sections hereof are
provided for convenience only and are not to serve as a basis for
interpretation or construction, and shall not constitute a part, of this
Agreement.

(k)           Signature in Counterparts.  This Agreement may be signed in counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.

 

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IN WITNESS
WHEREOF, the
parties hereto have executed this Agreement.

	
   

  	
  Williams Scotsman International, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Name of Participant]

  

 

6Exhibit 10.36

WILLIAMS
SCOTSMAN INTERNATIONAL INC.

2005 EMPLOYEE STOCK
PURCHASE PLAN

The following constitute
the provisions of the 2005 EmployeeStock Purchase Plan of Williams
Scotsman International Inc.

1.             Purpose.  The purpose of the Plan is to provide
employees of the Company and its Subsidiaries with an opportunity to purchase
Common Stock of the Company through accumulated payroll deductions.  It is the intention of the Company to have
the Plan qualify as an “EmployeeStock Purchase Plan”
under Section 423 of the Code.  The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that
section of the Code.

2.             Definitions.  As used herein, the following definitions shall
apply:

(a)           “Administrator” means either
the Board or a committee of the Board that is responsible for the
administration of the Plan as is designated from time to time by resolution of
the Board.

(b)           “Applicable Laws” means the
legal requirements relating to the administration of employee stock purchase
plans, if any, under applicable provisions of federal securities laws, state
corporate and securities laws, the Code, the rules of any applicable stock
exchange or national market system, and the rules of any foreign jurisdiction
applicable to participation in the Plan by residents therein.

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

(d)           “Change in Control” shall be
deemed to occur upon:

(1)             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 50% or more (on a fully diluted basis)
of either (A) the then outstanding shares of Common Stock of the Company,
taking into account as outstanding for this purpose such Common  Stock issuable upon the exercise of options
or warrants, the conversion of convertible stock or debt, and the exercise of
any similar right to acquire such Common Stock (the “Outstanding Company
Common Stock”) or (B) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting Securities”); provided,
however, that for purposes of this Plan, the following acquisitions
shall not constitute a Change in Control: 
(I) any acquisition by the Company or any Affiliate, (II) any
acquisition by any

employee benefit plan sponsored or maintained by the
Company or any Affiliate, or (III) in respect of an Award held by a
particular Participant, any acquisition by the Participant or any group of
persons including the Participant (or any entity controlled by the Participant
or any group of persons including the Participant);

(2)           individuals who, on the date hereof,
constitute the Board (the “Incumbent Directors”) cease for any reason to
constitute at least a majority of the Board, provided that any person becoming
a director subsequent to the date hereof, whose election or nomination for
election was approved by a vote of at least two-thirds of the Incumbent
Directors then on the Board (either by a specific vote or by approval of a
registration statement of the Company describing such person’s inclusion on the
Board, or a proxy statement of the Company in which such person is named as a
nominee for director, without written objection to such nomination) shall be an
Incumbent Director; provided, however, that no individual
initially elected or nominated as a director of the Company as a result of an
actual or threatened election contest, as such terms are used in Rule 14a-11 of
Regulation A promulgated under the Exchange Act, with respect to directors or
as a result of any other actual or threatened solicitation of proxies or
consents by or on behalf of any person other than the Board shall be deemed to
be an Incumbent Director;

(3)           the dissolution or liquidation of the
Company;

(4)           the sale, transfer or other
disposition of all or substantially all of the business or assets of the
Company, other than any such sale, transfer or other disposition to one or more
Designated Holders; or

(5)           the consummation of a reorganization,
recapitalization, merger, consolidation, statutory share exchange or similar
form of corporate transaction involving the Company that requires the approval
of the Company’s stockholders, whether for such transaction or the issuance of
securities in the transaction (a “Business Combination”), unless
immediately following such Business Combination:  (A) more than 50% of the total voting power
of (x) the entity resulting from such Business Combination (the “Surviving
Company”), or (y) if applicable, the ultimate parent entity that directly
or indirectly has beneficial ownership of sufficient voting securities eligible
to elect a majority of the members of the board of directors (or the analogous
governing body) of the Surviving Company (the “Parent Company”), is
represented by the Outstanding Company Voting Securities that were outstanding
immediately prior to such Business Combination (or, if applicable, is
represented by shares into which the Outstanding Company Voting Securities were
converted pursuant to such Business Combination), and such voting power among
the holders thereof is in substantially the same proportion as the voting power
of the Outstanding Company Voting Securities among the holders thereof
immediately prior to the Business Combination, and (B) at least a majority of
the members of the board of directors (or the analogous governing body) of the
Parent Company (or, if there is no Parent Company, the Surviving Company)
following the consummation of the Business Combination were Board members at
the time of the Board’s approval of the execution of the initial agreement
providing for such Business Combination.

 

 

 

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(e)           “Code” means the Internal
Revenue Code of 1986, as amended.

(f)            “Common Stock” means the
common stock of the Company.

(g)           “Company” means Williams
Scotsman International Inc., a Delaware corporation.

(h)           “Compensation” means an
Employee’s base salary, overtime, commissions and bonuses from the Company or
one or more s or Subsidiaries, including such amounts of base salary as are
deferred by the Employee (i) under a qualified cash or deferred
arrangement described in Section 401(k) of the Code, or (ii) to a
plan qualified under Section 125 of the Code.  Compensation does not include reimbursements
or other expense allowances, fringe benefits (cash or noncash), moving
expenses, deferred compensation, contributions (other than contributions
described in the first sentence) made on the Employee’s behalf by the Company
or one or more Subsidiaries under any employee benefit or welfare plan now or
hereafter established, and any other payments not specifically referenced in
the first sentence.

(i)             “Designated Holder” means (a)
(1) The Cypress Group L.L.C., Cypress Merchant Banking Partners L.P., Cypress
Offshore Partners L.P., Keystone Group, L.P., Oak Hill Strategic Partners,
L.P., Scotsman Partners, L.P. and any affiliate of any of the foregoing, (2)
any individual who is both a member of the senior management of Williams
Scotsman Inc. or the Company and a stockholder of the Company and (3) Odyssey
Partners, L.P. and any affiliate of any of the foregoing.

(j)             “Effective Date” means the
date the Administrator deems appropriate to commence the first Offer Period.  However, should any Subsidiary become a
participating company in the Plan after such date, then such entity shall
designate a separate Effective Date with respect to its employee-participants.

(k)           “Employee” means any
individual, including an officer or director, who is an employee of the Company
or a Subsidiary for purposes of Section 423 of the Code.  For purposes of the Plan, the employment
relationship shall be treated as continuing intact while the individual is on
sick leave or other leave of absence approved by the individual’s employer.  Where the period of leave exceeds ninety
(90) days and the individual’s right to reemployment is not guaranteed
either by statute or by contract, the employment relationship will be deemed to
have terminated on the ninety-first (91st) day of such leave, for purposes of
determining eligibility to participate in the Plan.

(l)            “Enrollment Date” means the
first day of each Offer Period.

 

 

 

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(m)          “Exchange Act” means the
Securities Exchange Act of 1934, as amended.

(n)           “Exercise Date” means the last
day of each Purchase Period.

(o)           “Fair Market Value” means, as
of any date, the value of Common Stock determined as follows:

(1)           Where there exists a public market
for the Common Stock, the Fair Market Value shall be (A) the closing price
for a share of Common Stock for the last market trading day prior to the time
of the determination (or, if no closing price was reported on that date, on the
last trading date on which a closing price was reported) on the stock exchange
determined by the Administrator to be the primary market for the Common Stock
or the Nasdaq National Market, whichever is applicable or (B) if the
Common Stock is not traded on any such exchange or national market system, the
average of the closing bid and asked prices of a share of Common Stock on the
Nasdaq Small Cap Market for the day prior to the time of the determination (or,
if no such prices were reported on that date, on the last date on which such
prices were reported), in each case, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

(2)           In the absence of an established
market of the type described in (1), above, for the Common Stock, the Fair
Market Value thereof shall be determined by the Administrator in good faith.

(p)           “Offer Period” means an Offer
Period established pursuant to Section 4 hereof.

(q)           “Parent” means a “parent
corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.

(r)            “Participant” means an
Employee of the Company or Subsidiary who is actively participating in the
Plan.

(s)           “Plan” means this Williams
Scotsman International Inc. Employee Stock Purchase Plan.

(t)            “Purchase Period” means a
period specified as such pursuant to Section 4(b) hereof.

(u)           “Purchase Price” shall mean an
amount equal to 95.25% of the Fair Market Value of a share of Common Stock on
the Exercise Date.

(v)           “Reserves” means the sum of
the number of shares of Common Stock covered by each option under the Plan
which have not yet been exercised and the number of shares of Common Stock
which have been authorized for issuance under the Plan but not yet placed under
option.

 

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(w)          “Subsidiary” means a “subsidiary
corporation,” whether now or hereafter existing, as defined in
Section 424(f) of the Code.

(x)            “Subsidiaries” means the
Subsidiaries which have been designated by the Administrator from time to time
as eligible to participate in the Plan.

3.             Eligibility.

(a)           General.  Any individual who is an Employee on a given
Enrollment Date shall be eligible to participate in the Plan for the Offer
Period commencing with such Enrollment Date.

(b)           Limitations on Grant and Accrual.  Any provisions of the Plan to the contrary
notwithstanding, no Employee shall be granted an option under the Plan if, (i) immediately
after the grant, such Employee (taking into account stock owned by any other
person whose stock would be attributed to such Employee pursuant to
Section 424(d) of the Code) would own stock and/or hold outstanding
options to purchase stock possessing five percent (5%) or more of the total
combined voting power or value of all classes of stock of the Company or of any
Subsidiary, or (ii) which permits the Employee’s rights to purchase stock
under all employee stock purchase plans of the Company and its Subsidiaries to
accrue at a rate which exceeds twenty-five thousand Dollars ($25,000) worth of
stock (determined at the Fair Market Value of the shares at the time such
option is granted) for each calendar year in which such option is outstanding
at any time.  The determination of the
accrual of the right to purchase stock shall be made in accordance with
Section 423(b)(8) of the Code and the regulations thereunder.

(c)           Other Limits on Eligibility.  Notwithstanding Subsection (a), above, the
following Employees shall not be eligible to participate in the Plan for any
relevant Offer Period: (i) Employees whose customary employment is 20
hours or less per week; (ii) Employees whose customary employment is for
not more than 5 months in any calendar year; (iii) Employees who are
officers of the Company or a Subsidiary, for Offer Periods during which they
are excluded pursuant to Section 3(a) above; and (iv) Employees who are
subject to rules or laws of a foreign jurisdiction that prohibit or make
impractical the participation of such Employees in the Plan.

4.             Offer Periods.

(a)           The Plan shall be implemented through
overlapping or consecutive Offer Periods until such time as (i) the
maximum number of shares of Common Stock available for issuance under the Plan
shall have been purchased or (ii) the Plan shall have been sooner
terminated in accordance with Section 19 hereof.  The

 

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duration of each Offer Period shall be set in advance
by the Administrator, and no Offer Period shall have a duration greater than 12
months.

(b)           A Participant shall be granted a
separate option for each Offer Period in which he or she participates.  The option shall be granted on the Enrollment
Date and shall be automatically exercised on the last day of the Offer Period.  However, with respect to any Offer Period,
the Administrator may specify shorter Purchase Periods within an Offer Period,
such that the option granted on the Enrollment Date shall be automatically
exercised in successive installments on the last day of each Purchase Period
ending within the Offer Period.

(c)           Except as specifically provided
herein, the acquisition of Common Stock through participation in the Plan for
any Offer Period shall neither limit nor require the acquisition of Common Stock
by a Participant in any subsequent Offer Period.

5.             Participation.

(a)           An eligible Employee may become a
Participant in the Plan by completing a subscription agreement authorizing
payroll deductions on such form the Administrator designates for evidencing
elections to participate in this Plan and filing it in accordance with
procedures established by the Administrator for such purpose at least ten
(10) business days prior to the Enrollment Date for the Offer Period in
which such participation will commence, unless a later time for filing the
subscription agreement is set by the Administrator for all eligible Employees
with respect to a given Offer Period.

(b)           Payroll deductions for a Participant
shall commence with the first partial or full payroll period beginning on the
Enrollment Date and shall end on the last complete payroll period during the
Offer Period, unless sooner terminated by the Participant as provided in
Section 10.

6.             Payroll Deductions.

(a)           At the time a Participant files a
subscription agreement, the Participant shall elect to have payroll deductions
made during the Offer Period in an amount not exceeding $10,000 during any
Offer Period, in accordance with uniform rules established by the Administrator.

(b)           All payroll deductions made for a
Participant shall be credited to the Participant’s account under the Plan.

(c)           A Participant may discontinue
participation in the Plan as provided in Section 10, during the Offer
Period by completing and filing with the Company a change of status notice on
the form established by the Administrator for such purpose authorizing a
suspension of the Participant’s payroll deductions.  Any such suspension shall be effective with
the first full payroll period commencing ten (10) business days after the
Company’s receipt of the change of status notice unless the Company elects to
process a given change in participation more quickly.

 

 

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(d)           Notwithstanding the foregoing, to the
extent necessary to comply with the limits set forth in Section 423(b)(8)
of the Code and Section 3(b) herein, a Participant’s payroll deductions
shall be decreased to zero Dollars ($0). 
Payroll deductions shall recommence at the rate provided in such
Participant’s subscription agreement, as amended, at the time when permitted
under Section 423(b)(8) of the Code and Section 3(b) herein, unless
such participation is sooner terminated by the Participant as provided in
Section 10.

7.             Grant
of Option.  On the Enrollment Date of
each Offer Period, each eligible Employee participating in such Offer Period
shall be granted an option to purchase on the Exercise Date of such Offer
Period (at the applicable Purchase Price) up to a number of shares of the
Company’s Common Stock determined by dividing such Employee’s payroll
deductions accumulated prior to such Exercise Date and retained in the
Participant’s account as of the Exercise Date by the applicable Purchase Price;
provided that in no event shall an Employee be permitted to purchase during
each Offer Period more than the number of shares determined by dividing $12,500
by the Fair Market Value on the first day of the Offer Period, such limit to be
adjusted ratably by the Administrator for Offer Periods greater than or less
than six months (subject to any adjustment pursuant to Section 18), and
provided further that such purchase shall be subject to the limitations set
forth in Sections 3(b) and 12 hereof. 
Exercise of the option shall occur as provided in Section 8 hereof,
unless the participant has withdrawn pursuant to Section 10 hereof.  The Employee may accept the grant of such
option by turning in a completed and signed subscription agreement to the
Company on or prior to the first day of the Offer Period, or with respect to
the first Offer Period, within the time frame permitted under Section 5(a)
above.  The administrator may, for future
Offer Periods, increase or decrease, in its absolute discretion, the maximum
number of shares of the Company’s Common Stock an employee may purchase during
an Offer Period.  Exercise of the option
shall occur as provided in Section 8 hereof, unless the participant has
withdrawn pursuant to Section 10 hereof. 
The option shall expire on the last day of the Offer Period.

8.             Exercise
of Option.  Unless a participant withdraws
from the Plan as provided in Section 10 hereof, his or her option for the
purchase of shares shall be exercised automatically on the Exercise Date, and
the maximum number of full shares subject to option shall be purchased for such
participant at the applicable Purchase Price with the accumulated payroll
deductions in his or her account.  No
fractional shares shall be purchased; any payroll deductions accumulated in a
participant’s account which are not sufficient to purchase a full share shall
be retained in the participant’s account for the subsequent Offer Period,
subject to earlier withdrawal by the participant as provided in Section 10
hereof.  Any other monies left over in a
participant’s account after the Exercise Date shall be returned to the
participant.  During a participant’s
lifetime, a participant’s option to purchase shares hereunder is exercisable
only by him or her.

9.             Delivery.  Upon receipt of a request from a Participant
after each Exercise Date on which a purchase of shares occurs, the Company
shall arrange the

 

 

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delivery to such
Participant, as promptly as practicable, of a certificate representing the
shares purchased upon exercise of the Participant’s option.

10.           Withdrawal; Termination of
Employment.

(a)           A Participant may either
(i) withdraw all but not less than all the payroll deductions credited to
the Participant’s account and not yet used to exercise the Participant’s option
under the Plan or (ii) terminate future payroll deductions, but allow
accumulated payroll deductions to be used to exercise the Participant’s option
under the Plan at any time by giving written notice to the Company on the form established
by the Administrator for such purpose.  If
the Participant elects withdrawal alternative (i) described above, all of
the Participant’s payroll deductions credited to the Participant’s account will
be paid to such Participant as promptly as practicable after receipt of notice
of withdrawal, such Participant’s option for the Offer Period will be
automatically terminated, and no further payroll deductions for the purchase of
shares will be made during the Offer Period. 
If the Participant elects withdrawal alternative (ii) described
above, no further payroll deductions for the purchase of shares will be made
during the Offer Period, all of the Participant’s payroll deductions credited
to the Participant’s account will be applied to the exercise of the Participant’s
option on the next Exercise Date, and after such Exercise Date, such
Participant’s option for the Offer Period will be automatically terminated.  If a Participant withdraws from an Offer
Period, payroll deductions will not resume at the beginning of the succeeding
Offer Period unless the Participant delivers to the Company a new subscription
agreement.

(b)           Upon termination of a Participant’s
employment relationship (as described in Section 2(k)) at a time more than
three (3) months from the next scheduled Exercise Date, the payroll
deductions credited to such Participant’s account during the Offer Period but
not yet used to exercise the option will be returned to such Participant or, in
the case of his/her death, to the person or persons entitled thereto under
Section 14, and such Participant’s option will be automatically terminated.  Upon termination of a Participant’s
employment relationship (as described in Section 2(k)) within three
(3) months of the next scheduled Exercise Date, the payroll deductions
credited to such Participant’s account during the Offer Period but not yet used
to exercise the option will be applied to the purchase of Common Stock on the
next Exercise Date, unless the Participant (or in the case of the Participant’s
death, the person or persons entitled to the Participant’s account balance under
Section 14) withdraws from the Plan by submitting a change of status
notice in accordance with subsection (a) of this Section 10.  In such a case, no further payroll deductions
will be credited to the Participant’s account following the Participant’s termination
of employment and the Participant’s option under the Plan will be automatically
terminated after the purchase of Common Stock on the next scheduled Exercise
Date.

11.           Interest.  No interest shall accrue on the payroll
deductions credited to a Participant’s account under the Plan.

 

8

 

12.           Stock.

(a)           The maximum number of shares of
Common Stock which shall be made available for sale under the Plan shall be 1,000,000
shares, subject to adjustment upon changes in capitalization of the Company as
provided in Section 18.  If the
Administrator determines that on a given Exercise Date the number of shares
with respect to which options are to be exercised may exceed (x) the
number of shares then available for sale under the Plan or (y) the number
of shares available for sale under the Plan on the Enrollment Date(s) of one or
more of the Offer Periods in which such Exercise Date is to occur, the
Administrator may make a pro rata allocation of the shares remaining available
for purchase on such Enrollment Dates or Exercise Date, as applicable, in as
uniform a manner as shall be practicable and as it shall determine to be
equitable, and shall either continue all Offer Periods then in effect or
terminate any one or more Offer Periods then in effect pursuant to
Section 19, below.

(b)           A Participant will have no interest
or voting right in shares covered by the Participant’s option until such shares
are actually purchased on the Participant’s behalf in accordance with the
applicable provisions of the Plan.  No
adjustment shall be made for dividends, distributions or other rights for which
the record date is prior to the date of such purchase.

(c)           Shares to be delivered to a
Participant under the Plan will be registered in the name of the Participant or
in the name of the Participant and his or her spouse.

13.           Administration.

(a)           The Plan shall be administered by the
Administrator which shall have full and exclusive discretionary authority to
construe, interpret and apply the terms of the Plan, to determine eligibility
and to adjudicate all disputed claims filed under the Plan.  Every finding, decision and determination
made by the Administrator shall, to the full extent permitted by Applicable
Law, be final and binding upon all persons.

(b)           Rule
16b-3 Limitations.  Notwithstanding the provisions of Subsection
(a) of this Section 13, in the event that the Company shall at any time be
subject to Section 16 promulgated under the Securities Exchange Act of
1934, as amended (the “Exchange Act”), and Rule 16b-3 promulgated
thereunder or any successor provision (“Rule 16b-3”) provides specific
requirements for the administrators of plans of this type, then at such time
the Plan shall be administered only by such a body and in such a manner as
shall comply with the applicable requirements of Rule 16b-3.  If the Company shall be subject to
Section 16, then unless permitted by Rule 16b-3, no discretion
concerning decisions regarding the Plan shall be afforded to any committee or
person that is not “disinterested” as that term is used in Rule 16b-3.

 

 

9

14.           Designation of Beneficiary.

(a)           Each Participant will file a written
designation of a beneficiary who is to receive any shares and cash, if any,
from the Participant’s account under the Plan in the event of such Participant’s
death.  If a Participant is married and
the designated beneficiary is not the spouse, spousal consent shall be required
for such designation to be effective.

(b)           Such designation of beneficiary may
be changed by the Participant (and the Participant’s spouse, if any) at any
time by written notice.  In the event of
the death of a Participant and in the absence of a beneficiary validly
designated under the Plan who is living (or in existence) at the time of such
Participant’s death, the Company shall deliver such shares and/or cash to the
executor or administrator of the estate of the Participant, or if no such
executor or administrator has been appointed (to the knowledge of the
Administrator), the Administrator shall deliver such shares and/or cash to the
spouse (or domestic partner, as determined by the Administrator) of the
Participant, or if no spouse (or domestic partner) is known to the
Administrator, then to the issue of the Participant, such distribution to be
made per stirpes (by right of representation), or if no issue are known to the
Administrator, then to the heirs at law of the Participant determined in
accordance with Section 27.

15.           Transferability.  Neither payroll deductions credited to a
Participant’s account nor any rights with regard to the exercise of an option
or to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in Section 14 hereof) by the Participant.  Any such attempt at assignment, transfer,
pledge or other disposition shall be without effect, except that the
Administrator may treat such act as an election to withdraw funds from an Offer
Period in accordance with Section 10.

16.           Use
of Funds.  All payroll deductions
received or held by the Company under the Plan may be used by the Company for
any corporate purpose, and the Company shall not be obligated to segregate such
payroll deductions.

17.           Reports.  Individual accounts will be maintained for
each Participant in the Plan.  Statements
of account will be given to Participants at least annually, which statements
will set forth the amounts of payroll deductions, the Purchase Price, the
number of shares purchased and the remaining cash balance, if any.

18.           Adjustments Upon Changes in
Capitalization; Changes in Control.

(a)           Adjustments Upon Changes in
Capitalization.  Subject to any
required action by the stockholders of the Company, the Reserves, the Purchase
Price, the maximum number of shares that may be purchased in any Offer Period
or Purchase Period, as well as any other terms that the Administrator
determines require adjustment shall be proportionately adjusted for (i) any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, (ii) any other

 

10

 

increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company, or
(iii) as the Administrator may determine in its discretion, any other
transaction with respect to Common Stock to which Section 424(a) of the
Code applies; provided, however that conversion of any convertible securities
of the Company shall not be deemed to have been “effected without receipt of
consideration.” Such adjustment shall be made by the Administrator and its
determination shall be final, binding and conclusive.  Except as the Administrator determines, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason hereof shall be made with respect to, the Reserves and the Purchase
Price.

(b)           Changes in Control.  In the event of a proposed Change in Control,
each option under the Plan shall be assumed by such successor corporation or a
parent or subsidiary of such successor corporation, unless the Administrator
determines, in the exercise of its sole discretion and in lieu of such
assumption, to shorten the Offer Period then in progress by setting a new
Exercise Date (the “New Exercise Date”). 
If the Administrator shortens the Offer Period then in progress in lieu
of assumption in the event of a Change in Control, the Administrator shall
notify each Participant in writing, at least ten (10) days prior to the
New Exercise Date, that the Exercise Date for the Participant’s option has been
changed to the New Exercise Date and that the Participant’s option will be
exercised automatically on the New Exercise Date, unless prior to such date the
Participant has withdrawn from the Offer Period as provided in Section 10.  For purposes of this Subsection, an option
granted under the Plan shall be deemed to be assumed if, in connection with the
Change in Control, the option is replaced with a comparable option with respect
to shares of capital stock of the successor corporation or Parent thereof.  The determination of option comparability
shall be made by the Administrator prior to the Change in Control and its
determination shall be final, binding and conclusive on all persons.

(c)           Dissolution
or Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, the Offer
Period shall terminate immediately prior to the consummation of such proposed
action, unless otherwise provided by the Board.

19.           Amendment or Termination.

(a)           The Administrator may at any time and
for any reason terminate or amend the Plan. 
Except as provided in Section 18, no such termination can affect
options previously granted, provided that the Plan or any one or more Offer
Periods may be terminated by the Administrator on any Exercise Date or by the
Administrator establishing a new Exercise Date with respect to any Offer Period
and/or any Purchase Period then in progress if the Administrator determines
that the termination of the Plan or such one or more Offer Periods is in the
best interests of the Company and its stockholders.  Except as provided in Section 18 and
this Section 19, no amendment may make any change in any option
theretofore granted which adversely affects the rights of any Participant
without the consent of affected Participants. 
To the extent necessary to comply with Section 423 of the Code (or
any successor rule or provision or

 

11

 

any other Applicable Law), the Company shall obtain
stockholder approval in such a manner and to such a degree as required.

(b)           Without stockholder consent and
without regard to whether any Participant rights may be considered to have been
“adversely affected,” the Administrator shall be entitled to limit the
frequency and/or number of changes in the amount withheld during Offer Periods,
change the length of Purchase Periods within any Offer Period, determine the
length of any future Offer Period, determine whether future Offer Periods shall
be consecutive or overlapping, establish the exchange ratio applicable to
amounts withheld in a currency other than U.S. dollars, establish additional
terms, conditions, rules or procedures to accommodate the rules or laws of
applicable foreign jurisdictions, permit payroll withholding in excess of the
amount designated by a Participant in order to adjust for delays or mistakes in
the Company’s processing of properly completed withholding elections, establish
reasonable waiting and adjustment periods and/or accounting and crediting
procedures to ensure that amounts applied toward the purchase of Common Stock
for each Participant properly correspond with amounts withheld from the
Participant’s Compensation, and establish such other limitations or procedures
as the Administrator determines in its sole discretion advisable and which are
consistent with the Plan.

(c)           In the event the Board determines
that the ongoing operation of the Plan may result in unfavorable financial
accounting consequences, the Board may, in its discretion and, to the extent
necessary or desirable, modify or amend the Plan to reduce or eliminate such
accounting consequence including, but not limited to:

(1)           altering the Purchase Price for any Offer
Period including an Offer Period underway at the time of the change in Purchase
Price;

(2)           shortening any Offer Period so that Offer
Period ends on a new Exercise Date, including an Offer Period underway at the
time of the Board action; and

(3)           allocating shares.

Such modifications or
amendments shall not require stockholder approval or the consent of any Participants.

20            Notices.  All notices or other communications by a
Participant to the Company under or in connection with the Plan shall be deemed
to have been duly given when received in the form specified by the
Administrator at the location, or by the person, designated by the
Administrator for the receipt thereof.

21.           Conditions
Upon Issuance of Shares.  Shares
shall not be issued with respect to an option unless the exercise of such
option and the issuance and delivery of such shares pursuant thereto shall
comply with all Applicable Laws and shall be further subject to the approval of
counsel for the Company with respect to such

 

12

compliance.  As a condition to the exercise of an option,
the Company may require the Participant to represent and warrant at the time of
any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned Applicable Laws.  In
addition, no options shall be exercised or shares issued hereunder before the
Plan shall have been approved by stockholders of the Company as provided in
Section 23.  Any shares purchased in
connection with the exercise of an option must be held by the Participant for a
minimum of 180 days.

22.           Term
of Plan.  The Plan shall become
effective upon the earlier to occur of its adoption by the Board or its
approval by the stockholders of the Company. 
It shall continue in effect for a term of five (5) years unless sooner
terminated under Section 19.

23.           Plan
Approval.  The Plan was originally
adopted by the Board and by the Company’s stockholders on             
    2005.

24.           No
Employment Rights.  The Plan does
not, directly or indirectly, create any right for the benefit of any employee
or class of employees to purchase any shares under the Plan, or create in any
employee or class of employees any right with respect to continuation of
employment by the Company or a Subsidiary, and it shall not be deemed to
interfere in any way with such employer’s right to terminate, or otherwise
modify, an employee’s employment at any time.

25.           No
Effect on Retirement and Other Benefit Plans.  Except as specifically provided in a
retirement or other benefit plan of the Company or a Subsidiary, participation
in the Plan shall not be deemed compensation for purposes of computing benefits
or contributions under any retirement plan of the Company or a Subsidiary, and
shall not affect any benefits under any other benefit plan of any kind or any
benefit plan subsequently instituted under which the availability or amount of
benefits is related to level of compensation. 
The Plan is not a “Retirement Plan” or “Welfare Plan” under the Employee
Retirement Income Security Act of 1974, as amended.

26.           Effect
of Plan.  The provisions of the Plan
shall, in accordance with its terms, be binding upon, and inure to the benefit
of, all successors of each Participant, including, without limitation, such
Participant’s estate and the executors, administrators or trustees thereof,
heirs and legatees, and any receiver, trustee in bankruptcy or representative
of creditors of such Participant.

27.           Governing
Law.  The Plan is to be construed in
accordance with and governed by the internal laws of the State of Maryland
without giving effect to any choice of law rule that would cause the
application of the laws of any jurisdiction other than the internal laws of the
State of Maryland to the rights and duties of the parties, except to the extent
the internal laws of the State of Maryland are superseded by the laws of the
United States.  Should any provision of
the Plan be determined by a court of law to

 

 

13

 

be illegal or
unenforceable, the other provisions shall nevertheless remain effective and
shall remain enforceable.

28.           Dispute
Resolution.  The provisions of this
Section 28 (and as restated in the Subscription Agreement) shall be the
exclusive means of resolving disputes arising out of or relating to the Plan.  The Company and the Participant, or their
respective successors (the “parties”), shall attempt in good faith to resolve
any disputes arising out of or relating to the Plan by negotiation between
individuals who have authority to settle the controversy.  Negotiations shall be commenced by either
party by notice of a written statement of the party’s position and the name and
title of the individual who will represent the party.  Within thirty (30) days of the written
notification, the parties shall meet at a mutually acceptable time and place,
and thereafter as often as they reasonably deem necessary, to resolve the
dispute.  If the dispute has not been
resolved by negotiation, the parties agree that any suit, action, or proceeding
arising out of or relating to the Plan shall be brought in the United States
District Court for the District of Maryland (or should such court lack
jurisdiction to hear such action, suit or proceeding, in a Maryland state court
in the County of Baltimore) and that the parties shall submit to the
jurisdiction of such court.  The parties
irrevocably waive, to the fullest extent permitted by law, any objection the
party may have to the laying of venue for any such suit, action or proceeding
brought in such court.  THE PARTIES ALSO
EXPRESSLY WAIVE ANY RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH
SUIT, ACTION OR PROCEEDING.  If any one
or more provisions of this Section 28 shall for any reason be held invalid
or unenforceable, it is the specific intent of the parties that such provisions
shall be modified to the minimum extent necessary to make it or its application
valid and enforceable.

 

 

14

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