Document:

ex10_4.htm

Adamis Pharmaceuticals Corporation 8-K

 

Exhibit 10.4

 

 

Convertible Promissory Note

 

	
Principal Amount:  $500,000

	
June 11, 2012

 

The Borrower is Adamis Pharmaceuticals Corporation, a Delaware corporation, located at 11455 El Camino Real, Suite 310, San Diego, California  92130 (“Borrower”).

 

The Lender is The G-Max Trust, located in San Diego, California (“Lender” or “Holder”).

 

1.           Principal

 

For value received, Borrower promises to pay Lender Five Hundred Thousand Dollars ($500,000.00) with interest thereon calculated in accordance with the terms and provisions herein.  All sums owed under this Note are payable in lawful money of the United States of America.  Payment shall be made at Lender's address as above.

 

2.           Interest

 

Commencing on June 1, 2012, interest shall accrue daily and compound monthly on the outstanding principal amount of this Note at a rate per annum equal to 10% and shall be due and payable on the first Business Day of each month in cash beginning July 1, 2012, subject to the subordination provisions set forth in Section 11 below.  On the Maturity Date, Borrower shall pay to the Lender all accrued but unpaid interest hereunder.  Interest shall be calculated on the basis of a 360-day year and actual days elapsed.

 

3.           Maturity

 

The Principal Amount of this Note shall become due and payable on April 1, 2013 (the “Maturity Date”).  The failure of the Lender to insist upon immediate payment in full upon the Maturity Date shall not be deemed a waiver of such right.  The Lender has the right to extend the Maturity Date in its sole discretion by delivery of notice, as described below.

 

4.           Conversion Right

 

At any time on or before the Maturity Date, the Lender has the right to convert part or all of the principal and accrued interest into common stock of Adamis Pharmaceuticals Corporation at $0.55 per share (which figure shall be subject to proportionate adjustment to reflect any stock dividend, stock split, reverse stock split, reclassification, or other similar event affecting the number of outstanding shares of common stock of Borrower).

 

If Lender desires to exercise such conversion right, it shall deliver a notice to Borrower no later than five (5) business days before the Maturity Date.

 

  

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In the event of conversion, the Lender will surrender the original copy of this Note for conversion at the principal office of the Borrower.  Lender agrees to execute such documents in connection with the conversion of this Note as Borrower reasonably requests.  If upon conversion of this Note a fraction of a share would result, then Borrower will, at Borrower’s election, either round up to the next highest share or pay cash in lieu of such fractional share, calculated on the basis of the fair market value (as determined by Borrower) of a share.  All rights with respect to the converted portion of this Note shall terminate upon issuance of the corresponding securities to the Lender.  In connection with a partial conversion of this Note, Lender agrees to surrender this Note to Borrower for cancellation as to that portion of the Note that the Lender elects to convert, and Borrower shall execute and deliver a new Note upon the same terms and conditions set forth herein, dated the date hereof, evidencing the right of the Lender to the balance of the principal that was not converted (and accrued but unpaid interest thereon, as applicable).  As soon as reasonably practicable after conversion of this Note and receipt of the original Note and related documents, Borrower at its expense will cause to be issued in the name of and delivered to the Lender, a certificate or certificates (or, if Borrower determines that the shares will be represented in uncertificated form, then appropriate share notices) for the number of shares to which the Lender is entitled on such conversion (bearing such legends as Borrower determines are necessary or appropriate), together with any other securities and property, if any, to which the Lender is entitled on such conversion under the terms of this Note.

 

5.           Stock Sale

 

As further consideration for making the loan described herein, Borrower has agreed to sell Lender five hundred thousand (500,000) shares of common stock of Borrower for a total price of Five Hundred Dollars ($500.00).

 

6.           Default

 

Borrower will be in default if any of the following occurs:  (a) Borrower fails to make payment of the Principal Amount when due and fails to cure the default within the time period specified herein; and/or (b) Borrower fails in any material respect to comply with or to perform when due any other material term, obligation, covenant, or condition contained in this Note and fails to cure the default within the time period specified herein.  Notwithstanding any provisions to the contrary contained in this Note, in the event of default by the Borrower, the Lender must provide Borrower with written notice of default, and the Borrower will have five (5) business days to cure the default.

 

7.           Lender's Rights

 

Upon default, Lender may declare the entire unpaid Principal Amount immediately due, subject to the subordination provisions set forth in Section 11 below.  Upon the failure to pay the Principal Amount upon final maturity, Lender, at its option, may charge default interest on this Note at a rate equal to the lesser of (i) eighteen percent (18%) per annum and (ii) the maximum rate permitted under applicable usury or other laws.

 

  

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8.           Collection Costs

 

If Lender prevails in a lawsuit to collect on this Note, Borrower will pay Lender's costs and attorneys’ fees in an amount the court finds to be reasonable.

 

9.           Investment Representations

 

The Lender hereby represents, warrants, acknowledges and agrees that:

 

9.1           Investment.  The Lender is acquiring this Note, the securities issuable upon conversion of this Note, and the shares of common stock issuable pursuant to Section 5 above (collectively, the “Securities” and the shares of common stock included in the Securities referred to as the “Transaction Shares”) for the Lender’s own account, and not directly or indirectly for the account of any other person.  The Lender is acquiring the Securities for investment and not with a view to distribution or resale thereof except in compliance with Securities Act of 1933 (the “Act”) and any applicable state law regulating securities.  Lender must bear the economic risk of investment for an indefinite period of time because the Securities have not been registered under the Act and therefore cannot and will not be sold unless they are subsequently registered under the Act or an exemption from such registration is available.

 

9.2           Access to Information.  The Lender has had the opportunity to ask questions of, and to receive answers from, the chief executive officer of Borrower with respect to the terms and conditions of the transactions contemplated hereby and with respect to the business and affairs of Borrower.  The Lender has had access to such financial and other information as Lender considers necessary in order for the Lender to make a fully informed decision as to investment in the Securities.

 

9.3           Experience; Pre-Existing Relationship.  Lender has such business or financial expertise as to be able to protect the Lender’s own interests in connection with the purchase of the Securities.  Lender has a preexisting personal or business relationship with Borrower and/or certain of its officers and/or directors of a nature and duration sufficient to make Lender aware of the character, business acumen and general business and financial circumstances of Borrower and/or such officers and directors.  By reason of Lender’s business or financial experience, Lender is capable of evaluating the merits and risks of this investment, has the ability to protect Lender’s own interests in this transaction and is financially capable of bearing a total loss of this investment.

 

9.4           No Tax Advice.  Lender represents and warrants that Lender is not relying on Borrower for any tax advice concerning the federal or state consequences of this Note or the other Securities acquired hereunder by Lender.

 

9.5           Accredited Investor; No General Solicitation.  Lender is an “accredited investor” within the meaning of Regulation D promulgated under the Act.  At no time was Lender presented with or solicited by any publicly issued or circulated newspaper, mail, radio, television or other form of general advertising or solicitation in connection with the offer, sale and purchase of the Securities.

 

  

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9.6           Restrictions on Transfer; Securities Laws.  Lender understands that Lender may not transfer any Securities unless such Securities are registered under the Act and qualified under any applicable state securities laws or unless, in the opinion of counsel to Borrower, exemptions from such registration and qualification requirements are available.  Lender has also been advised that exemptions from registration and qualification may not be available or may not permit Lender to transfer all or any of the Securities in the amounts or at the times proposed by Lender.  In addition, Lender has been advised that SEC Rule 144 promulgated under the Act, which permits certain limited sales of unregistered securities, requires that the Securities be held for certain minimum time periods after they have been purchased and paid for (within the meaning of Rule 144), before they may be resold under Rule 144.

 

10.           Registration Rights

 

10.1           Public Information; Rule 144.  In general, under Rule 144 promulgated by the Securities and Exchange Commission (the “Commission”), a person who is not an affiliate of the issuer, such as Lender, may, after a six-month holding period, publicly sell restricted securities without restriction as long as adequate current public information about the issuer is available, and without any restrictions (including the adequate current public information requirement) after a one-year holding period. With a view to making available the benefits of Rule 144, commencing six months after the date of this Note Borrower agrees to use its reasonable best efforts to (a) make and keep adequate public information available, as those terms are understood and defined in Rule 144 under the Act, and (b) file with the Commission all reports and other documents required of Borrower under the Act and the Securities Exchange Act of 1934, as amended. Borrower shall have no obligations pursuant to the preceding sentence at any time that Borrower may sell all Transaction Shares without limitation pursuant to Rule 144.

 

10.2           Registration.

 

(a)           At any time after one year after the date of the Notes, if the Transaction Shares cannot be sold without restriction pursuant to Rule 144, then if Borrower files a registration statement pursuant to the Act at any time within one year after the date of the Notes, relating to an offering for the account of others under the Act of any of its equity securities (other than on Form S-4 or Form S-8 (each as promulgated under the Act) or their then equivalents), then Borrower will promptly will give to Lender written notice thereof (which will include a list of the jurisdictions in which Borrower intends to attempt to qualify such securities under the applicable blue sky or other state securities laws) and will, subject to the provisions below, include in such registration and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, all Transaction Shares specified by Lender in a written request delivered to Borrower within 10 days after such written notice from Borrower, subject to the rights of any other holders of Borrower’s securities, pursuant to written registration rights with Borrower, to have such other securities included in such registration in preference to the Transaction Shares and to the ability of any underwriter or placement agent involved in such registration to limit the number of securities of Borrower to be included in such registration.

 

(b)           Borrower will pay the registration fee relating to the inclusion of the Transaction Shares in the registration.  The Lender shall be responsible for its own fees and expenses, including attorneys’ fees, relating to such registration and any sale of Transaction Shares pursuant to any such registration.  In connection with any such registration, Lender shall execute such customary documents as Borrower may reasonably request relating to the registration and sale of Transaction Shares pursuant to any such registration statement.

 

  

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11.           Subordination

 

11.1           Definitions.  For purposes of this Note:

 

(a)           “Senior Indebtedness” shall mean the principal of and unpaid interest on, and any other obligations under, any and all indebtedness of Borrower (whether or not convertible into equity securities of Borrower), whether outstanding on the date hereof or hereafter created, pursuant to any secured note (and any agreements or instruments relating thereto) issued or made by Borrower either before or after the date of this Note, or any indebtedness of Borrower issued or made by Borrower either before or after the date of this Note pursuant to any convertible promissory note of Borrower issued to Gemini Master Fund, Ltd. or its affiliates (“Gemini”), and any amendments, renewals or extensions of any such indebtedness, or any debentures, notes or other evidence of indebtedness issued in exchange for such Senior Indebtedness.

 

(b)           “Senior Lender” shall mean any holder of Senior Indebtedness.

 

(c)           “Subordinated Indebtedness” means all obligations arising under or relating to this Note (together with all renewals, extensions and modifications hereof and any note or notes issued in substitution herefor) and each and every other debt, liability and obligation of every type and description which the Borrower may now or at any time hereafter owe to the Lender, whether such debt, liability or obligation now exists or is hereafter created or incurred, and whether it is or may be direct or indirect, due or to become due, absolute or contingent, primary or secondary, liquidated or unliquidated, or joint, several or joint and several.

 

11.2           Subordination.  The payment of all of principal, interest and any other amounts that may become due under or pursuant to this Subordinated Indebtedness is hereby expressly subordinated to the extent and in the manner hereinafter set forth to the payment in full of all Senior Indebtedness; and regardless of any priority otherwise available to the Lender by law or by agreement, as between the holders of Subordinated Indebtedness and the Senior Lender, the Senior Lender shall hold a first priority lien in all collateral relating to the Senior Indebtedness, and any lien claimed therein by the Lender shall be and remain fully subordinate for all purposes to the lien of the Senior Lender therein for all purposes whatsoever.  The Subordinated Indebtedness shall continue to be subordinated to the Senior Indebtedness even if the Senior Indebtedness is deemed unsecured, under-secured, subordinated, avoided or disallowed under the United States Bankruptcy Code or other applicable law.

 

  

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11.3           Payments.  Until all of the Senior Indebtedness has been paid in full and the Senior Lender has released its lien in the collateral, if any, the Lender shall not, without the Senior Lender’s prior written consent, demand, receive or accept any payment, other than current interest payments, from Borrower in respect of the Subordinated Indebtedness, or exercise any right of or permit any setoff in respect of the Subordinated Indebtedness.  If the Lender receives any payment on the Subordinated Indebtedness that the Lender is not entitled to receive under the provisions of this Agreement, the Lender will hold the amount so received in trust for the Senior Lender and will forthwith turn over such payment to the Senior Lender in the form received (except for the endorsement of the Lender where necessary) for application to then-existing Senior Indebtedness (whether or not due), in such manner of application as the Senior Lender may deem appropriate.  If the Lender exercises any right of setoff which the Lender is not permitted to exercise under the provisions of this Agreement, the Lender will promptly pay over to the Senior Lender, in immediately available funds, an amount equal to the amount of the claims or obligations offset.  If the Lender fails to make any endorsement required under the provisions of this Section 11, the Senior Lender, or any of its officers or employees or agents on behalf of the Senior Lender, is hereby irrevocably appointed as the attorney-in-fact (which appointment is coupled with an interest) for the Lender to make such endorsement in the Lender’s name.

 

11.4           Insolvency Proceedings.  If there shall occur any receivership, insolvency, assignment for the benefit of creditors, bankruptcy, arrangements with creditors (whether or not pursuant to bankruptcy or other insolvency laws), or any other marshalling of the assets and liabilities of Borrower (“Insolvency Proceeding”), (i) no amount shall be paid by Borrower in respect of the principal or other amounts due with respect to the Subordinated Indebtedness at the time outstanding, unless and until the principal of and interest on the Senior Indebtedness then outstanding shall be paid in full, (ii) no claim or proof of claim shall be filed with Borrower by or on behalf of Holder that shall assert any right to receive any payments in respect of the principal of and interest on the Subordinated Indebtedness except subject to the payment in full of the principal of and interest on all of the Senior Indebtedness then outstanding, and (iii) any payment or distribution of any kind or character that may be payable or deliverable in respect of the Subordinated Indebtedness shall be paid or delivered directly to the holders of the Senior Indebtedness for application in payment thereof, unless and until all principal and interest on all Senior Indebtedness shall have been paid in full or such payment shall have been provided for.  In the event of any Insolvency Proceeding, the Lender will file all claims, proofs of claim or other instruments of similar character necessary to enforce the obligations of Borrower in respect of the Subordinated Indebtedness and will hold in trust for the Senior Lender and promptly pay over to the Senior Lender in the form received (except for the endorsement of the Lender where necessary) for application to the then-existing Senior Indebtedness, any and all moneys, dividends or other assets received in any such proceedings on account of the Subordinated Indebtedness, unless and until the Senior Indebtedness has been paid in full and the Senior Lender’s lien in the Collateral has been terminated.  If the Lender shall fail to take any such action, the Senior Lender, as attorney-in-fact for the Lender, may take such action on the Lender’ behalf.  The Lender hereby irrevocably appoint the Senior Lender, or any of its officers or employees on behalf of the Senior Lender, as the attorney-in-fact for the Lender (which appointment is coupled with an interest) with the power but not the duty to demand, sue for, collect and receive any and all such moneys, dividends or other assets and give acquittance therefor and to file any claim, proof of claim or other instrument of similar character, to vote claims comprising Subordinated Indebtedness to accept or reject any plan of partial or complete liquidation, reorganization, arrangement, composition or extension and to take such other action in the Senior Lender’s own name or in the name of the Lender as the Senior Lender may deem necessary or advisable for the enforcement of the agreements contained herein; and the Lender will execute and deliver to the Senior Lender such other and further powers-of-attorney or instruments as the Senior Lender may reasonably request in order to accomplish the foregoing.  If the Senior Lender desires to permit the use of cash collateral or to provide post-petition financing to Borrower, the Lender shall not object to the same or assert that its interests are not being adequately protected.

 

  

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11.5           Default on Senior Indebtedness.  If there shall occur an event of default with respect to any Senior Indebtedness, as defined therein, or in the instrument under which it is outstanding, permitting the holder to accelerate the maturity thereof, then, unless and until such event of default shall have been cured or waived or shall have ceased to exist, or all Senior Indebtedness shall have been paid in full, no payment shall be made in respect of this Note for a period of one hundred eighty (180) days after the first occurrence of such event of default.

 

11.6           Further Assurances.  By acceptance of this Note, Holder agrees to execute and deliver customary forms of subordination agreements requested from time to time by holders of Senior Indebtedness, and as a condition to the Holder's rights hereunder, Borrower may require that Holder execute such forms of subordination agreements.

 

11.7           Subrogation. Subject to the payment in full of all Senior Indebtedness, Holder shall be subrogated to the rights of the holder(s) of such Senior Indebtedness, to the extent of the payments or distributions made to the holder(s) of such Senior Indebtedness pursuant to the provisions of this Section 11, to receive payments and distributions of assets of Borrower applicable to the Senior Indebtedness.  No such payments or distributions applicable to the Senior Indebtedness shall, as between the Borrower and its creditors, other than the holders of Senior Indebtedness and Holder, be deemed to be a payment by Borrower to or on account of this Note; and for purposes of such subrogation, no payments or distributions to the holders of Senior Indebtedness to which Holder would be entitled except for the provisions of this Section shall, as between Borrower and its creditors, other than the holders of Senior Indebtedness and Holder, be deemed to be a payment by Borrower to or on account of the Senior Indebtedness.

 

11.8           Reliance of Holders of Senior Indebtedness.  Holder, by its acceptance hereof, shall be deemed to acknowledge and agree that the foregoing subordination provisions are, and are intended to be, an inducement to and a consideration of each holder of Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the creation of the indebtedness evidenced by this Note, and each such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and holding, or in continuing to hold, such Senior Indebtedness.  Gemini shall be a third party beneficiary of this Note, and any change to the terms hereof which are adverse to Gemini shall be subject to the prior written approval of Gemini.

 

11.9           Action on Subordinated Indebtedness.  The Lender will not commence any action or proceeding against Borrower to recover all or any part of the Subordinated Indebtedness, or join with any creditor (unless the Senior Lender shall so join) in bringing any proceeding against the Borrower under any bankruptcy, reorganization, readjustment of debt, arrangement of debt receivership, liquidation or insolvency law or statute of the federal or any state government, or take possession of, sell, or dispose of any Collateral, or exercise or enforce any right or remedy available to the Lender with respect to any such Collateral, unless and until the Senior Lender Indebtedness has been paid in full and the Senior Lender has released its Lien in the Collateral.

 

  

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12.           Miscellaneous

 

12.1           Notices.  Any notice required or permitted under this Note shall be given in writing and shall be deemed effectively given (i) at the time of personal delivery, if delivery is in person; (ii) one (1) business day after deposit with an express overnight courier for United States deliveries, or two (2) business days after such deposit for deliveries outside of the United States, with proof of delivery from the courier requested; (iii) three (3) business days after deposit in the United States mail by certified mail (return receipt requested) for United States deliveries when addressed to the party to be notified; or (iv) one (1) business day after transmission by telecopier with confirmation of successful transmission, to the addresses set forth at the beginning of this Note (or, with respect to Lender, at the address for Lender that is contained in the Borrower’s stock and note records), or at such other address as any party may designate by giving written notice to the other party.

 

12.2           Entire Agreement.  This Note contemplated hereby (a) represents the entire agreement between the parties and replaces and supersedes any and all oral agreements between the parties, as well as any prior agreement and understandings, writings, both written and oral, among the parties with respect to the subject matter hereof; (b) is not intended to confer upon any other person any rights or remedies hereunder; and (c) shall not be assigned (other than by operation of law).

 

12.3           Successors and Assignees.  This Note binds and benefits the heirs, successors and assignees of the parties.

 

12.4           Governing Law; Consent to Jurisdiction.  This Note will be governed by and construed in accordance with the laws of the state of California.  Each of the parties hereto irrevocably consents to the exclusive jurisdiction and venue of any court in San Diego, California, in connection with any matter based upon or arising out of this Note or the matters contemplated herein, agrees that process may be served upon them in any manner authorized in this Note for the delivery of notices, and waives and covenants not to assert or plead any objection which they might otherwise have to such jurisdiction, venue and such process.

 

12.5           Waiver.  If one party waives any term or provision of this Note at any time, that waiver will be effective only for the specific instance and specific purpose for which the waiver was given.  If either party fails to exercise or delays exercising any of its rights or remedies under this Note, that party retains the right to enforce that term or provision at a later time.

 

12.6           Severability.  If any court determines that any provision of this Note is invalid or unenforceable, any invalidity or unenforceability will affect only that provision and will not make any other provision of this Note invalid or unenforceable and such provision shall be modified, amended or limited only to the extent necessary to render it valid and enforceable.

 

12.7           Counterparts.  This Note may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument.

 

  

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IN WITNESS WHEREOF, Borrower and Lender have executed this Convertible Promissory Note as of the date first written above.

 

BORROWER

	
Adamis Pharmaceuticals Corporation

11455 El Camino Real, Suite 301

San Diego, California  92130

	  
	  	  	  
	Dated:   June 11, 2012	 
	 	 	 
	
By:

	

/s/

	  
	
 

	Dennis J. Carlo	  
	
 

	
Chief Executive Officer

	  

 

LENDER

 

	
The G-Max Trust

	  
	  	  	  
	Dated:   June 11, 2012	 
	 	 	 
	
By:

	

/s/

	  
	
 

	Christoph BooExhibit 10.1 (2007 Equity and Incentive Plan)

EXHIBIT 10.1

ORBITZ WORLDWIDE, INC.
2007 EQUITY AND INCENTIVE PLAN
(As amended and restated, effective June 12, 2012)

1.    Purpose; Types of Awards; Construction.

The purposes of the Orbitz Worldwide, Inc. 2007 Equity and Incentive Plan (the “Plan”) are to afford an incentive to non-employee directors, selected officers and other employees, advisors and consultants of Orbitz Worldwide, Inc. (the “Company”), or any Parent or Subsidiary of the Company that now exists or hereafter is organized or acquired, to continue as non-employee directors, officers, employees, advisors or consultants, as the case may be, to increase their efforts on behalf of the Company and its Subsidiaries and to promote the success of the Company's business. The Plan provides for the grant of Options (including “incentive stock options” and “nonqualified stock options”), stock appreciation rights, restricted stock, restricted stock units and other stock- or cash-based awards. The Plan is designed so that Awards granted hereunder intended to comply with the requirements for “performance-based compensation” under Section 162(m) of the Code comply with such requirements, and the Plan and Awards shall be interpreted in a manner consistent with such requirements.

2.    Definitions

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

(a) “Annual Incentive Program” means the program described in Section 6(c) hereof.

(b) “Award” means any Option, SAR, Restricted Stock, Restricted Stock Unit or Other Stock-Based Award or Other Cash-Based Award granted under the Plan.

(c) “Award Agreement” means any written agreement, contract, or other instrument or document, in each case as approved by the Committee, evidencing an Award.

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

(e) “Change in Control” means, following the Effective Date and excluding the separation transaction pursuant to which the Company becomes a separate public corporation for the first time, a change in control of the Company, which will have occurred if:

(i) any “person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than (A) the Company, (B) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (C) any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of Stock), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Company's then outstanding voting securities (excluding any person who becomes such a beneficial owner in connection with a transaction immediately following which the individuals who comprise the Board immediately prior thereto constitute at least a majority of the Board of the entity surviving such transaction or, if the Company or the entity surviving the transaction is then a subsidiary, the ultimate parent thereof);

(ii) the following individuals cease for any reason to constitute a majority of the number of directors then serving: individuals who, on the Effective Date, constitute the Board and any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company's stockholders was approved or recommended by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors on the Effective Date or whose appointment, election or nomination for election was previously so approved or recommended;

(iii) there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than a merger or consolidation immediately following which the individuals who comprise the Board immediately prior thereto constitute at least a majority of the Board, the entity surviving such merger or consolidation or, if the Company or the entity surviving such merger is then 

a subsidiary, the ultimate parent thereof; or

(iv) the stockholders of the Company approve a plan of complete liquidation of the Company or there is consummated an agreement for the sale or disposition by the Company of all or substantially all of the Company's assets (or any transaction having a similar effect), other than a sale or disposition by the Company of all or substantially all of the Company's assets to an entity, immediately following which the individuals who comprise the Board immediately prior thereto constitute at least a majority of the board of directors of the entity to which such assets are sold or disposed of or, if such entity is a subsidiary, the ultimate parent thereof.

Notwithstanding the foregoing, a Change in Control shall not be deemed to have occurred by virtue of the consummation of any transaction or series of integrated transactions immediately following which individuals who comprise the Board immediately prior thereto constitute at least a majority of the board of directors of an entity which owns all or substantially all of the assets of the Company immediately following such transaction or series of transactions.

(f) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rules and regulations promulgated thereunder.

(g) “Committee” means the committee established by the Board to administer the Plan, the composition of which shall at all times satisfy the provisions of Rule 16b-3 and Section 162(m) of the Code.

(h) “Company” means Orbitz Worldwide, Inc., a corporation organized under the laws of the State of Delaware, or any successor corporation.

(i) “Covered Employee” shall have the meaning set forth in Section 162(m)(3) of the Code.

(j) “Effective Date” means the effective date of the IPO.

(k) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations promulgated thereunder.

(l) “Fair Market Value” means the fair market value determined in such manner as the Committee, in its sole discretion, may deem equitable or as required by applicable law, rule or regulation. Unless the Committee otherwise determines, with respect to an Award granted under the Plan, “Fair Market Value” means (i) the mean between the highest and lowest reported sales price per share of Stock on the national securities exchange on which the Stock is principally traded on the date of grant of such Award, or if the date of grant is not a trading day, then the last preceding date on which there was a sale of such Stock on such exchange, or (ii) if the shares of Stock are then traded in an over-the-counter market, the average of the closing bid and asked prices for the shares of Stock in such over-the-counter market for the date of grant of such Award, or if the date of grant is not a trading day, then the last preceding date on which there was a sale of such Stock on such over-the-counter market.

(m) “Grantee” means a person who, as a non-employee director, officer or other employee, advisor or consultant of the Company or a Parent or Subsidiary of the Company, has been granted an Award under the Plan.

(n) “IPO” means the initial public offering of the Company's Stock.

(o) “ISO” means any Option intended to be and designated as an incentive stock option within the meaning of Section 422 of the Code.

(p) “Long Range Incentive Program” means the program described in Section 6(b) hereof.

(q) “Non-Employee Director” means any director of the Company who is not also employed by the Company or any of its Subsidiaries.

(r) “NQSO” means any Option that is not designated as an ISO.

(s) “Option” means a right, granted to a Grantee under Section 6(b)(i), to purchase shares of Stock. An Option may be either an ISO or an NQSO, provided that ISOs may be granted only to employees of the Company or a Parent or Subsidiary of the Company.

(t) “Other Cash-Based Award” means cash awarded under the Annual Incentive Program or the Long Range Incentive Program, including cash awarded as a bonus or upon the attainment of Performance Goals or otherwise as permitted under the Plan.

(u) “Other Stock-Based Award” means a right or other interest granted to a Grantee under the Annual Incentive Program or the Long Range Incentive Program that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Stock, including but not limited to (i) unrestricted Stock awarded as a bonus or upon the attainment of Performance Goals or otherwise as permitted under the Plan, and (ii) a right granted to a Grantee to acquire Stock from the Company containing terms and conditions prescribed by the Committee.

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

(w) “Performance Goals” means performance goals based on one or more of the following criteria, determined in accordance with generally accepted accounting principles where applicable: (i) pre-tax income or after-tax income; (ii) income or earnings including operating income, earnings before or after taxes, interest, depreciation, amortization, and/or extraordinary or special items; (iii) net income excluding amortization of intangible assets, depreciation and impairment of goodwill and intangible assets and/or excluding charges attributable to the adoption of new accounting pronouncements; (iv) earnings or book value per share (basic or diluted); (v) return on assets (gross or net), return on investment, return on capital, or return on equity; (vi) return on revenues; (vii) cash flow, free cash flow, cash flow return on investment (discounted or otherwise), net cash provided by operations, or cash flow in excess of cost of capital; (viii) economic value created; (ix) operating margin or profit margin; (x) room nights; Reflects the proposed amendment to include room nights as an available Performance Goal under the Plan. (xi) stock price or total stockholder return; (xii) income or earnings from continuing operations; (xiii) cost targets, reductions and savings, expense management, productivity and efficiencies; and (xiv) strategic business criteria, consisting of one or more objectives based on meeting specified market penetration or market share, geographic business expansion, customer satisfaction, employee satisfaction, human resources management, supervision of litigation, information technology, and goals relating to divestitures, joint ventures and similar transactions. Where applicable, the Performance Goals may be expressed in terms of attaining a specified level of the particular criterion or the attainment of a percentage increase or decrease in the particular criterion, and may be applied to one or more of the Company or a Parent or Subsidiary of the Company, or a division or strategic business unit of the Company, all as determined by the Committee. The Performance Goals may include a threshold level of performance below which no payment will be made (or no vesting will occur), levels of performance at which specified payments will be paid (or specified vesting will occur), and a maximum level of performance above which no additional payment will be made (or at which full vesting will occur). Each of the foregoing Performance Goals shall be evaluated in accordance with generally accepted accounting principles, where applicable, and shall be subject to certification by the Committee. The Committee shall have the authority to make equitable adjustments to the Performance Goals in recognition of unusual or non-recurring events affecting the Company or any Parent or Subsidiary of the Company or the financial statements of the Company or any Parent or Subsidiary of the Company, in response to changes in applicable laws or regulations, or to account for items of gain, loss or expense determined to be extraordinary or unusual in nature or infrequent in occurrence or related to the disposal of a segment of a business or related to a change in accounting principles.

(x) “Plan” means this Orbitz Worldwide, Inc. 2007 Equity and Incentive Plan, as amended from time to time.

(y) “Plan Year” means a calendar year.

(z) “Restricted Stock” means an Award of shares of Stock to a Grantee under Section 6(b)(iii) that may be subject to certain restrictions and to a risk of forfeiture.

(aa) “Restricted Stock Unit” or “RSU” means a right granted to a Grantee under Section 6(b)(iv) to receive Stock or cash at the end of a specified period, which right may be conditioned on the satisfaction of specified performance or other criteria.

(bb) “Rule 16b-3” means Rule 16b-3, as from time to time in effect promulgated by the Securities and Exchange Commission under Section 16 of the Exchange Act, including any successor to such Rule.

(cc) “Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder.

(dd) “Stock” means shares of the common stock, par value $0.01 per share, of the Company.

(ee) “Stock Appreciation Right” or “SAR” means the right, granted to a Grantee under Section 6(b)(ii), to be paid an amount measured by the appreciation in the Fair Market Value of Stock from the date of grant to the date of exercise of the right.

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

3.    Administration.

The Plan shall be administered by the Board or by such Committee that the Board may appoint for this purpose. If a Committee is appointed to administer the Plan, all references herein to the “Committee” shall be references to such Committee. If no Committee is appointed by the Board to administer the Plan, all references herein to the “Committee” shall be references to the Board. The Committee shall have the authority in its discretion, subject to and not inconsistent with the express provisions of the Plan, to administer the Plan and to exercise all the powers and authorities either specifically granted to it under the Plan or necessary or advisable in the administration of the Plan, including, without limitation, the authority to grant Awards; to determine the persons to whom and the time or times at which Awards shall be granted; to determine the type and number of Awards to be granted, the number of shares of Stock to which an Award may relate and the terms, conditions, restrictions and performance criteria relating to any Award; to determine Performance Goals no later than such time as required to ensure that an underlying Award which is intended to comply with the requirements of Section 162(m) of the Code so complies; and to determine whether, to what extent, and under what circumstances an Award may be settled, cancelled, forfeited, exchanged, or surrendered; to amend the terms and conditions of outstanding Awards, including, but not limited to extending the exercise period of such Awards and accelerating the vesting schedule of such Awards; to make adjustments in the terms and conditions of, and the Performance Goals (if any) included in, Awards; to construe and interpret the Plan and any Award; to prescribe, amend and rescind rules and regulations relating to the Plan; to determine the terms and provisions of the Award Agreements (which need not be identical for each Grantee); and to make all other determinations deemed necessary or advisable for the administration of the Plan. Notwithstanding the foregoing, neither the Board, the Committee nor their respective delegates shall have the authority to reprice (or cancel and regrant) any Option or, if applicable, other Award at a lower exercise, base or purchase price without first obtaining the approval of the Company's stockholders. Notwithstanding any other provision of the Plan to the contrary, upon approval of the Company's stockholders, the Committee may provide for, and the Company may implement, a one-time only stock option exchange program, pursuant to which certain outstanding Options could, at the election of the person holding such Option, be tendered to the Company for cancellation in exchange for the issuance of a lesser amount of Options with a lower exercise price, or other equity benefit as may be approved by the Committee, provided that such one-time only stock option exchange program is implemented within twelve months of the date of such stockholder approval.

The Committee may delegate to one or more of its members or to one or more agents such administrative duties as it may deem advisable, and the Committee or any person to whom it has delegated duties as aforesaid may employ one or more persons to render advice with respect to any responsibility the Committee or such person may have under the Plan. All decisions, determinations and interpretations of the Committee shall be final and binding on all persons, including but not limited to the Company, any Parent or Subsidiary of the Company or any Grantee (or any person claiming any rights under the Plan from or through any Grantee) and any stockholder.

No member of the Board or Committee shall be liable for any action taken or determination made in good faith with respect to the Plan or any Award granted hereunder.

4.    Eligibility.

Awards may be granted to selected non-employee directors, officers and other employees, advisors or consultants of the Company or any Parent or Subsidiary of the Company, in the discretion of the Committee. In determining the persons to whom Awards shall be granted and the type of any Award (including the number of shares to be covered by such Award), the Committee shall take into account such factors as the Committee shall deem relevant in connection with accomplishing the purposes of the Plan.

5.    Stock Subject to the Plan.

The maximum number of shares of Stock reserved for issuance under the Plan shall be 24,100,000, Reflects the proposed 

amendment to increase shares of Stock reserved for issuance under the Plan from 21,100,000 to 24,100,000. subject to adjustment as provided herein. No more than (i) 5,000,000 shares of Stock may be made subject to NQSOs or SARs to a single individual in a single Plan Year, (ii) 2,500,000 shares of Stock may be made subject to stock-based awards other than Options or SARs (including Restricted Stock and Restricted Stock Units or Other Stock-Based Awards denominated in shares of Stock) to a single individual in a single Plan Year, and (iii) 1,000,000 shares of Stock may be issued pursuant to the exercise of ISO's, in each case, subject to adjustment as provided herein. Determinations made in respect of the limitations set forth in the immediately preceding sentence shall be made in a manner consistent with Section 162(m) of the Code. Such shares may, in whole or in part, be authorized but unissued shares or shares that shall have been or may be reacquired by the Company in the open market, in private transactions or otherwise. If any shares subject to an Award are forfeited, cancelled, exchanged or surrendered or if an Award terminates or expires without a distribution of shares to the Grantee, the shares of Stock with respect to such Award shall, to the extent of any such forfeiture, cancellation, exchange, surrender, termination or expiration, again be available for Awards under the Plan. Reflects the proposed amendment to delete a liberal share recycling provision from the Plan. Upon the exercise of any Award granted in tandem with any other Award, such related Award shall be cancelled to the extent of the number of shares of Stock as to which the Award is exercised and, notwithstanding the foregoing, such number of shares shall no longer be available for Awards under the Plan.

In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, Stock, or other property), recapitalization, Stock split, reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, or share exchange, or other similar corporate transaction or event, affects the Stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of Grantees under the Plan, then the Committee shall make such equitable changes or adjustments as it deems necessary or appropriate to any or all of (i) the number and kind of shares of Stock or other property (including cash) that may thereafter be issued in connection with Awards, (ii) the number and kind of shares of Stock or other property (including cash) issued or issuable in respect of outstanding Awards, (iii) the exercise price, grant price, or purchase price relating to any Award; provided, that, with respect to ISOs, such adjustment shall be made in accordance with Section 424(h) of the Code, (iv) annual award limitations set forth in Section 5, and (v) the Performance Goals applicable to outstanding Awards.

6.    Specific Terms of Awards.

(a) General.  The term of each Award shall be for such period as may be determined by the Committee. Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by the Company or a Parent or Subsidiary of the Company upon the grant, vesting, maturation, or exercise of an Award may be made in such forms as the Committee shall determine at the date of grant or thereafter, including, without limitation, cash, Stock, or other property, and may be made in a single payment or transfer, in installments, or on a deferred basis. The Committee may make rules relating to installment or deferred payments with respect to Awards, including the rate of interest to be credited with respect to such payments. In addition to the foregoing, the Committee may impose on any Award or the exercise thereof, at the date of grant or thereafter, such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine.

(b) Long Range Incentive Program.   Under the Long Range Incentive Program, the Committee is authorized to grant the Awards described in this Section 6(b), under such terms and conditions as deemed by the Committee to be consistent with the purposes of the Plan. Such Awards may be granted with value and payment contingent upon Performance Goals. Except as otherwise set forth herein or as may be determined by the Committee, each Award granted under the Long Range Incentive Program shall be evidenced by an Award Agreement containing such terms and conditions applicable to such Award as the Committee shall determine at the date of grant or thereafter.

(i) Options.  The Committee is authorized to grant Options to Grantees on the following terms and conditions:

(a) Type of Award.  The Award Agreement evidencing the grant of an Option under the Plan shall designate the Option as an ISO or an NQSO.

(b) Exercise Price.  The exercise price per share of Stock purchasable under an Option shall be determined by the Committee, but, subject to Section 6(b)(v), in no event shall the per share exercise price of any Option be less than the Fair Market Value of a share of Stock on the date of grant of such Option. The exercise price for Stock subject to an Option may be paid in cash or by an exchange of Stock previously owned by the Grantee for at least six months (if acquired from the Company), through a “broker cashless exercise” procedure approved by the Committee (to the extent permitted by law), or a combination of the above, in any case in an amount having a combined value equal to such exercise price. An Award Agreement may provide that a Grantee may pay all or a portion of the aggregate exercise price by having shares of Stock with a Fair Market Value on the date of exercise equal to the aggregate exercise price withheld by the Company.

(c) Term and Exercisability of Options.  The date on which the Committee adopts a resolution expressly granting an Option shall be considered the day on which such Option is granted. Options shall be exercisable over the exercise period (which shall not exceed ten years from the date of grant), at such times and upon such conditions as the Committee may determine, as reflected in the Award Agreement; provided, that the Committee shall have the authority to accelerate the exercisability of any outstanding Option at such time and under such circumstances as it, in its sole discretion, deems appropriate. An Option may be exercised to the extent of any or all full shares of Stock as to which the Option has become exercisable, by giving written notice of such exercise to the Committee or its designated agent.

(d) Termination of Employment.  An Option may not be exercised unless the Grantee is then a director of, in the employ of, or providing services to, the Company or a Parent or Subsidiary of the Company, and unless the Grantee has remained continuously so employed, or continuously maintained such relationship, since the date of grant of the Option; provided, that the Award Agreement may contain provisions extending the exercisability of Options, in the event of specified terminations of employment or service, to a date not later than the expiration date of such Option.

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