Document:

Exhibit 10.2

 

GEMC

2005 STOCK INCENTIVE PLAN

 

ARTICLE I

General

 

1.1                                 Purpose

 

The
GEMC 2005 Stock Incentive Plan (the “Plan”) is designed to provide certain key
persons, on whose initiative and efforts the successful conduct of the business
of Golden Energy Marine Corp. (the “Company”) depends, with incentives to: (a)
enter into and remain in the service of the Company, (b) acquire a proprietary
interest in the success of the Company, (c) maximize their performance, and (d)
enhance the long-term performance of the Company.

 

1.2                                 Administration

 

(a)                                              Administration by Board of Directors.  The Plan shall be administered by the
Company’s Board of Directors (the “Administrator”).  The Administrator shall have the authority
(i) to exercise all of the powers granted to it under the Plan, (ii) to
construe, interpret and implement the Plan and any Award Agreements executed
pursuant to Section 2.1 in its sole discretion with all such determination
being final, binding and conclusive, (iii) to prescribe, amend and rescind
rules and regulations relating to the Plan, including
rules governing its own operations, (iv) to make all determinations necessary
or advisable in administering the Plan, and (v) to correct any defect, supply
any omission and reconcile any inconsistency in the Plan.

 

(b)                                             Administrator Action.  Actions
of the Administrator shall be taken by
the vote of a majority of its members. 
Any action may be taken by a written instrument signed by a majority of
the Administrator members, and action so taken shall be fully as effective as
if it had been taken by a vote at a meeting. 
Except to the extent prohibited by applicable law or the applicable
rules of a stock exchange, the Administrator may allocate all or any portion of
its responsibilities and powers to any one or more of its members and may
delegate all or any part of its
responsibilities to any person or persons selected by it, and may revoke any such allocation or delegation
at any time.

 

1.3                                 Persons Eligible for Awards

 

The persons eligible to receive awards under
the Plan are those officers,
directors, and executive, managerial, administrative and professional employees of the Company and its
Service Providers, including, without limitation, its commercial and technical
managers, (collectively, “key persons”)
as the Administrator in its sole discretion shall select, taking into account the duties of the respective
employees, their present and potential contributions to the success of the
Company, and such other factors as the Administrator deems relevant in
connection with accomplishing the purpose of the Plan.  The Administrator may from time to time, in
its sole discretion, determine that any key person shall be ineligible to
receive awards under the Plan.

 

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1.4                                 Types of Awards Under Plan

 

Awards may be made under the Plan in the form of (a)
incentive stock options, (b) non-qualified stock options, (c) stock
appreciation rights, (d) dividend equivalent rights, (e) restricted stock,
(f) unrestricted stock, (g) restricted stock units, and (h) performance
shares, all as more fully set forth in Article II.  The term “award” means any of the
foregoing.  No incentive stock option may
be granted to a person who is not an employee of the Company on the date of
grant.

 

1.5                                 Shares Available for Awards

 

(a)                                              Aggregate Number Available; Certificate Legends.   Subject to the provisions of Section 1.5(b), the
total number of shares of common stock of the Company (“Common Stock”) with
respect to which awards may be granted pursuant to the Plan is 370,000 shares.  Shares issued pursuant to the Plan may be
authorized but unissued Common Stock, authorized and issued Common Stock held
in the Company’s treasury or Common Stock acquired by the Company for the
purposes of the Plan.  The Administrator
may direct that any stock certificate evidencing shares issued pursuant to the
Plan shall bear a legend setting forth such restrictions on transferability as
may apply to such shares.

 

(b)                                             Adjustment Upon Changes in Common Stock.  Upon
certain changes in Common Stock, the
number of shares of Common Stock available for issuance with respect to awards
that may be granted under the Plan pursuant to Section 1.5(a), shall be
adjusted pursuant to Section 3.7(a).

 

(c)                                              Certain Shares to Become Available Again.  The
following shares of Common Stock shall
again become available for awards under the Plan: any shares that are subject
to an award under the Plan and that remain unissued upon the cancellation or
termination of such award for any reason whatsoever; any shares of restricted
stock forfeited pursuant to Section 2.7(e), provided that any dividends paid on
such shares are also forfeited pursuant to such Section 2.7(e); and any shares
in respect of which a stock appreciation right or performance share award is
settled for cash.

 

1.6                                 Definitions of Certain Terms

 

(a)                                              The “Fair Market Value”
of a share of Common Stock on any day shall be the closing price on the Nasdaq
Stock Market as reported for such day in The Wall Street Journal or, if no such
price is reported for such day, the average of the high bid and low asked price
of Common Stock as reported for such day. 
If no quotation is made for the applicable day, the Fair Market Value of
a share of Common Stock on such day shall be determined in the manner set forth
in the preceding sentence using quotations for the next preceding day for which
there were quotations, provided that such quotations shall have been made
within the ten (10) business days preceding the applicable day.  Notwithstanding the foregoing, if deemed
necessary or appropriate by the Administrator, the Fair Market Value of a share
of Common Stock on any day shall be determined by the Administrator.  In no event shall the Fair Market Value of
any share of Common Stock be less than its par value.

 

(b)                                             The term “incentive stock option” means an option
that is intended to qualify for
special federal income tax treatment pursuant to sections 421 and 422 of the Code as now constituted or subsequently
amended, or pursuant to a successor provision of the

 

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Code, and which is
so designated in the applicable Grant Certificate.  Any option that is not specifically
designated as an incentive stock option shall under no circumstances be
considered an incentive stock option. 
Any option that is not an incentive stock option is referred to herein
as a “non-qualified stock option.”

 

(c)                                              The term “cause” in
connection with a termination of employment by reason of a dismissal for cause
shall mean:

 

(i)                         to the extent that there is an employment,
severance or other agreement governing the relationship between the grantee and
the Company, a Company subsidiary or a Company joint venture, which agreement
contains a definition of “cause,” cause shall consist of those acts or
omissions that would constitute “cause” under such agreement; and otherwise,

 

(ii)                      the grantee’s termination of employment by the
Company or an affiliate on account of any one or more of the following:

 

(A)                  any failure by the grantee substantially to perform
the grantee’s employment duties;

 

(B)                    any excessive unauthorized absenteeism by the
grantee;

 

(C)                    any refusal by the grantee to obey the lawful
orders of the Board or any other person or Administrator to whom the grantee
reports;

 

(D)                   any act or omission by
the grantee that is or may be injurious to the Company, monetarily or
otherwise;

 

(E)                     any act by the grantee that is inconsistent with
the best interests of the Company;

 

(F)                     the grantee’s material violation of any of the
Company’s policies, including, without limitation, those policies relating to
discrimination or sexual harassment;

 

(G)                    the grantee’s unauthorized (a) removal from the
premises of the Company or an affiliate of any document (in any medium or form)
relating to the Company or an affiliate or the customers or clients of the Company or an affiliate or (b) disclosure to
any person or entity of any of the
Company’s, or its affiliates’ confidential or proprietary information;

 

(H)                   the grantee’s commission of any felony, or any
other crime involving moral turpitude; and

 

(I)                        the grantee’s commission of any act involving
dishonesty or fraud.

 

The terms of this Section 1.6(c) shall apply to employees of Service
Providers in the same manner as they apply to employees of the Company.  Any rights
the Company may have hereunder in respect of the events giving rise to cause
shall be in addition to the rights the Company may have under any other
agreement with a grantee or at law or in equity.

 

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Any determination of whether a grantee’s
employment is (or is deemed to have been) terminated for cause shall be made by
the Administrator in its discretion, which determination shall be final,
binding and conclusive on all parties. 
If, subsequent to a grantee’s voluntary termination of employment or
involuntary termination of employment without cause, it is discovered that the
grantee’s employment could have been terminated for cause, the Administrator
may deem such grantee’s employment to have been terminated for cause.  A grantee’s termination of employment for
cause shall be effective as of the date of the occurrence of the event giving rise to cause, regardless of when
the determination of cause is made.

 

(d)                                             “Common
Stock Offering” shall mean the sale of the Company’s Common Stock in a firmly
underwritten public offering.

 

(e)                                              “Service
Provider” means a person or company engaged by the Company to provide ongoing
management or consulting services for the Company or for any entity controlled
by the Company.

 

ARTICLE II

Awards Under The Plan

 

2.1                                 Agreements Evidencing Awards

 

Each award granted under the Plan (except an
award of unrestricted stock)
shall be evidenced by a written certificate (“Award Agreement”) which shall
contain such provisions as the Administrator may, in its sole discretion, deem necessary or desirable.  By executing an Award Agreement pursuant to
the Plan, a grantee thereby agrees that the award shall be subject to all of
the terms and provisions of the Plan and the applicable Award Agreement.

 

2.2                                 Grant of Stock Options, Stock Appreciation Rights,
Restricted Stock Units and Dividend
Equivalent Rights

 

(a)                                              Stock Option Grants.  The Administrator may grant incentive stock
options and non-qualified stock options (“options”) to purchase shares of
Common Stock from the Company, to such key persons, and in such amounts and
subject to such vesting and forfeiture provisions and other terms and conditions, as the Administrator shall
determine, in its sole discretion, subject to the provisions of the Plan.  The
Administrator may not grant incentive stock options to non-employee directors
or Service Provider employees.

 

(b)                                             Stock Appreciation Right Grants; Types of Stock
Appreciation Rights.  The
Administrator may grant stock appreciation rights to such key persons, and in
such amounts and subject to such vesting and forfeiture provisions and other
terms and conditions, as the Administrator shall determine, in its sole
discretion, subject to the provisions of the Plan.  The terms of a stock appreciation right may
provide that it shall be automatically exercised for a cash payment upon the
happening of a specified event that is outside the control of the grantee, and
that it shall not be otherwise exercisable. 
Stock appreciation rights may be
granted in connection with all or any part of, or independently of, any option
granted under the Plan.  A stock
appreciation right granted in connection
with an option may be granted at or after the time of grant of such option.

 

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(c)                                              Nature
of Stock Appreciation Rights.  The
grantee of a stock appreciation right shall have the right, subject to the
terms of the Plan and the applicable Award
Agreement, to receive from the Company an amount equal to (i) the excess
of the Fair Market Value of a share of Common Stock on the date of exercise of
the stock appreciation right over the Fair Market Value of a share of Common Stock on the date of grant (or over
the option exercise price if the stock appreciation right is granted in
connection with an option), multiplied by (ii) the number of shares with
respect to which the stock appreciation right is exercised.  Payment upon exercise of a stock appreciation
right shall be in cash or in shares of Common
Stock (valued at their Fair Market Value on the date of exercise of the
stock appreciation right) or both, all as the Administrator shall determine in
its sole discretion.  Upon the exercise
of a stock appreciation right granted in connection with an option, the number of
shares subject to the option shall be reduced by the number of shares with respect to which the stock appreciation right is
exercised.  Upon the exercise of
an option in connection with which a stock appreciation right has been granted,
the number of shares subject to the stock
appreciation right shall be reduced by the number of shares with respect
to which the option is exercised.

 

(d)                                             Option Exercise Price.  Each Award Agreement with respect to an
option shall set forth the amount (the “option exercise price”) payable by the
grantee to the Company upon exercise of the option evidenced thereby.  The option
exercise price per share shall be determined by the Administrator in its sole discretion. 
Notwithstanding the foregoing, with respect to any options
granted within 30 days of a Common Stock Offering, the option exercise price
will be the average of the Fair Market Value of a share of Common Stock over
the 30 day period following the closing of the Common Stock Offering.

 

(e)                                                   Exercise Period.  Each Award Agreement with respect to an
option or stock appreciation right shall set forth the periods during which the
award evidenced thereby shall be exercisable, whether in whole or in part.  Such periods shall be determined by the
Administrator in its sole discretion; provided, however, that no option or a
stock appreciation right shall be exercisable more than 10 years after the date
of grant, and provided further that, except as and to the extent that the
Administrator may otherwise provide pursuant to Sections 2.5, 3.7 or 3.8, no
option or stock appreciation right shall be exercisable prior to the first
anniversary of the date of grant. (See the default exercise period provided for
under Sections 2.3(a) and (b).)

 

(f)                                                Reload
Options.  The Administrator may, in its
sole discretion, include in any Award Agreement with respect to an option (the
“original option”) a provision that an additional option (the “reload option”)
shall be granted to any grantee who, pursuant to Section 2.3(c)(ii), delivers
shares of Common Stock in partial or full payment of the exercise price of the
original option.  The reload option shall
be for a number of shares of Common Stock equal to the number thus delivered,
shall have an exercise price equal to the Fair Market Value of a share of
Common Stock on the date of exercise of the original option, and shall have an
expiration date no later than the expiration date of the original option.  In the event that an Award Agreement provides
for the grant of a reload option, such Agreement shall also provide that the
exercise price of the original option be no
less than the Fair Market Value of a share of Common Stock on its date
of grant, and that any shares that are delivered pursuant to Section 2.3(c)(ii)
in payment of such exercise price shall have been held for at least six months.

 

(g)                                             Dividend
Equivalent Rights.  The Administrator
may, in its sole discretion, include in any Award Agreement with respect to an
option, stock appreciation right or

 

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performance shares, a dividend
equivalent right entitling the grantee to receive amounts equal
to the ordinary dividends that would be paid,
during the time such award is outstanding and unexercised, on the shares of
Common Stock covered by such award if such shares were then outstanding.  In the event such a provision is included in
a Award Agreement, the Administrator shall determine whether such payments
shall be made in cash or in shares of Common Stock, whether they shall be
conditioned upon the exercise of the award to which they relate, the time or
times at which they shall be made, and such other vesting and forfeiture
provisions and other terms and conditions as the Administrator shall deem
appropriate.

 

(h)                     Restricted Stock Units.  The Administrator may, in its sole
discretion, grant restricted stock units to such key persons, and in such
amounts and subject to such vesting and forfeiture provisions and other terms
and conditions, as the Administrator shall determine, in its sole discretion, subject
to the provisions of the Plan.  A
restricted stock unit granted under the Plan shall confer upon the grantee a
right to receive from the Company, upon the occurrence of an event specified in
the Award Agreement, such grantee’s vested restricted stock units multiplied by
the Fair Market Value of a share of Common Stock.  Restricted stock units may be granted in connection with all or any part of, or independently
of, any award granted under the Plan.  A
restricted stock unit granted in connection
with another award may be granted at or after the time of grant of such award.

 

(i)                                                 Incentive Stock Option Limitation: Exercisability.   To the extent that the aggregate Fair Market Value
(determined as of the time the option
is granted) of the stock with respect to which incentive stock options are first exercisable by any employee during any
calendar year shall exceed $100,000, or such higher amount as may be permitted
from time to time under section 422 of
the Code, such options shall be treated as non-qualified stock options.

 

(j)                                                 Incentive Stock Option
Limitation: 10% Owners.  Notwithstanding
the provisions of paragraphs (d) and (e) of this Section 2.2, an incentive
stock option may not be granted under the Plan to an individual who, at the time
the option is granted, owns stock possessing more than 10% of the total
combined voting power of all classes of stock of his employer corporation or of
its parent or subsidiary corporations (as such ownership may be determined for
purposes of section 422(b) (6) of the Code) unless (i) at the time such incentive stock option is granted the option
exercise price is at least 110% of the Fair Market Value of the shares subject
thereto and (ii) the incentive stock option by its terms is not exercisable
after the expiration of 5 years from the date it is granted.

 

2.3                                 Exercise of Options, Stock Appreciation Rights and
Restricted Stock Units

 

Subject to the other provisions of this
Article II, each option, stock appreciation right and restricted stock unit
granted under the Plan shall be exercisable as follows:

 

(a)                                              Timing and Extent of Exercise.  Options, stock appreciation rights and
restricted stock units shall be exercisable at such times and under such
conditions as set forth in the corresponding Award Agreement, but in no event
shall any such award be exercisable prior to the first anniversary or
subsequent to the tenth anniversary of the date on which such award was
granted.  Unless the applicable Award
Agreement otherwise provides, an option, stock appreciation right or restricted
stock unit may be exercised from time to time as to all or part of the shares
or units as to which such award is
then exercisable.  A stock appreciation

 

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right granted in connection with an option may be exercised at any time when, and
to the same extent that, the related option may be exercised.

 

(b)                                             Notice of Exercise. 
 An
option, stock appreciation right or restricted stock unit shall be exercised by
the filing of a written notice with the Company or the Company’s designated exchange agent (the “exchange
agent”), on such form and in such
manner as the Administrator shall in its sole discretion prescribe.

 

(c)                                              Payment
of Exercise Price.  Any written notice of
exercise of an option shall be accompanied by payment for the shares being
purchased.  Such payment shall be made:
(i) by certified or official bank check (or the equivalent thereof acceptable to the Company or its exchange agent) for
the full  option exercise price; or
(ii) with the consent of the Administrator, by delivery of  shares of Common Stock having a Fair Market Value
(determined as of the exercise date) equal to all or part of the option exercise price and a certified or official
bank check (or the equivalent thereof
acceptable to the Company or its exchange agent) for any remaining portion of
the full option exercise price; or (iii) at the discretion of the Administrator
and to the extent permitted by law, by such other provision, consistent with
the terms of the Plan, as the Administrator may from time to time prescribe
(whether directly or indirectly through the exchange agent).

 

(d)                                             Delivery of Certificates Upon Exercise.  Subject to the provision of section 2.3(e),
promptly after receiving payment of the full option exercise price, or after
receiving notice of the exercise of a stock appreciation right for which
payment will be made partly or entirely in shares, the Company or its exchange
agent shall, subject to the provisions
of Section 3.2, deliver to the grantee or to such other person as may
then have the right to exercise the award, a certificate or certificates for the shares of Common Stock for which the award
has been exercised.  If the method of
payment employed upon option exercise so requires, and if applicable law permits,
an optionee may direct the Company or its exchange agent, as the case may be,
to deliver the stock certificate(s) to the optionee’s stockbroker.

 

(e)                                              Investment
Purpose and Legal Requirements. 
Notwithstanding the foregoing, at the time of the exercise of any
option, the Company may, if it shall deem it necessary or advisable for any
reason, require the holder of such option (i) to represent in writing to
the Company that it is the optionee’s then intention to acquire the Shares with
respect to which the option is to be exercised for investment and not with a
view to the distribution thereof, or (ii) to postpone the date of exercise
until such time as the Company has available for delivery to the optionee a
prospectus meeting the requirements of all applicable securities laws; and no
shares shall be issued or
transferred upon the exercise of any option unless and until all legal
requirements applicable to the issuance or transfer of such Shares have been
complied with to the satisfaction of the Company.  The Company shall have the right to condition
any issuance of shares to any optionee hereunder on such optionee’s undertaking
in writing to comply with such restrictions on the subsequent transfer of such
shares as the Company shall deem necessary or advisable as a result of any
applicable law, regulation or official interpretation thereof, and certificates
representing such shares may contain a legend to reflect any such restrictions.

 

(f)                                                No Stockholder Rights.  No grantee of an option, stock appreciation
right or restricted stock unit (or other person having the right to exercise
such award) shall have any of the rights of a stockholder of the Company with
respect to shares subject to such award until the issuance of a stock
certificate to such person for such shares. 
Except as otherwise provided in Section 1.5(b), no adjustment shall be
made for dividends,

 

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distributions or other rights
(whether ordinary or extraordinary, and whether in cash, securities or other
property) for which the record
date is prior to the date such stock certificate is issued.

 

2.4                                 Compensation in Lieu of Exercise of an Option

 

Upon written application of the grantee of an
option, the Administrator may in
its sole discretion determine to substitute, for the exercise of such option, compensation to the grantee not in excess of the
difference between the option exercise price and the Fair Market Value of the
shares covered by such written application on the date of such application.  Such compensation may be in cash, in shares
of Common Stock, or both, and the payment thereof may be subject to conditions, all as the Administrator shall
determine in its sole discretion.  In the event
compensation is substituted pursuant to this Section 2.4 for the exercise, in whole or in part, of an option, the number of
shares subject to the option shall be reduced by the number of shares for which
such compensation is substituted.

 

2.5                                 Termination of Employment; Death Subsequent to a
Termination of Employment

 

(a)                                            General Rule. 
Except to the extent otherwise provided in paragraphs (b), (c), (d) or
(e) of this Section 2.5 or Section 3.8(b)(iii), a grantee who incurs a
termination of employment may exercise any outstanding option or stock
appreciation right on the following terms and conditions: (i) exercise may be
made only to the extent that the grantee was entitled to exercise the award on the termination of employment
date; and (ii) exercise must occur
within three months after termination of employment but in no event after the
original expiration date of the award.

 

(b)                                             Dismissal for Cause; Resignation.  If a grantee incurs a termination of employment as the result of a
dismissal for cause or resignation
without the Company’s or Service Provider’s prior consent, as applicable, all
options and stock appreciation rights not theretofore exercised shall terminate
upon the grantee’s termination of employment.

 

(c)                                              Retirement.  If a grantee incurs a termination of
employment as the result of his retirement, then any outstanding option, stock
appreciation right or restricted stock unit shall be exercisable pursuant to
its terms.  For this purpose “retirement”
shall mean a grantee’s termination of employment, under circumstances other
than those described in paragraph (b) above, on or after: (x) his 65th
birthday, (y) the date on which he has attained age 60 and completed at least
five years of service with the Company or Service Provider, as applicable
(using any method of calculation the Administrator deems appropriate) or (z) if
approved by the Administrator, on or after he has completed at least 20 years
of service.

 

(d)                                             Disability.  If a grantee incurs a termination of employment by reason of a disability (as defined below), then
any outstanding option, stock appreciation right or restricted stock unit shall
be exercisable pursuant to its terms. 
For this purpose “disability” shall mean, except in connection any
physical or mental condition that would qualify a grantee for a disability
benefit under the long-term disability plan maintained by the Company or
Service Provider, as applicable, or, if there is no such plan, a physical or
mental condition that prevents the grantee from performing the essential
functions of the grantee’s position (with or without reasonable accommodation)
for a period of six consecutive months. 
The existence of a disability shall be determined by the Administrator
in its sole and absolute discretion.

 

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(e)                                              Death.

 

(i)                                   Termination of Employment as a Result of Grantee’s
Death.  If a grantee incurs a termination
of employment as the result of his death, then any outstanding option, stock appreciation right or restricted stock
unit shall be exercisable pursuant to
its terms.

 

(ii)                                  Restrictions on Exercise Following Death.  Any
such exercise of an award following a
grantee’s death shall be made only by the grantee’s executor or administrator
or other duly appointed representative reasonably acceptable to the Administrator, unless the grantee’s
will specifically disposes of such
award, in which case such exercise shall be made only by the recipient of such
specific disposition.  If a grantee’s
personal representative or the recipient of a specific disposition under the
grantee’s will shall be entitled to exercise any award pursuant to the
preceding sentence, such representative or recipient shall be bound by all the
terms and conditions of the Plan and the applicable Award Agreement which would
have applied to the grantee including, without limitation, the provisions of
Sections 3.2 and 3.5 hereof.

 

(f)                                                Special Rules for Incentive Stock Options.  No option that remains exercisable for more
than three months following a grantee’s termination of employment for any
reason other than death or disability, or for more than one year following a
grantee’s termination of employment as the result of his becoming disabled, may
be treated as an incentive stock option.

 

(g)                                             Administrator Discretion.   The
Administrator, in the applicable Award Agreement, may waive or modify the application of the foregoing provisions of this Section 2.5.

 

2.6                                 Transferability of Options, Stock Appreciation
Rights and Restricted Stock Units

 

Except as otherwise provided in an applicable Award Agreement
evidencing an option, stock appreciation right or restricted stock unit, during
the lifetime of a grantee, each such award granted to a grantee shall be exercisable only by the grantee and no such award
shall be assignable or transferable otherwise than by will or by the
laws of descent and distribution.  The Administrator may, in any applicable Award
Agreement evidencing an option (other than an incentive stock option to the
extent inconsistent with the requirements of section 422 of the Code applicable
to incentive stock options), permit a grantee to transfer all or some of the
options to (A) the grantee’s spouse, children or grandchildren (“Immediate
Family Members”), (B) a trust or trusts for the exclusive benefit of such
Immediate Family Members, or (C) other parties approved by the Administrator in
its sole and absolute discretion. 
Following any such transfer, any transferred options shall continue to
be subject to the same terms and conditions as were applicable immediately
prior to the transfer.

 

2.7                                 Grant of Restricted Stock

 

(a)                                              Restricted Stock Grants.  The Administrator may grant restricted shares
of Common Stock to such key persons, in such amounts, and subject to such
vesting and forfeiture provisions and other terms and conditions as the
Administrator shall determine in its sole discretion, subject to the provisions
of the Plan.  Restricted stock awards may
be

 

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made independently of or in connection with any other award under the Plan.  A grantee of a restricted stock award shall have no rights with respect to such award unless
such grantee accepts the award within such period as the Administrator shall
specify by accepting delivery of a restricted
stock agreement in such form as the Administrator shall determine and, in the event the restricted shares are newly issued
by the Company, makes payment to the
Company its exchange agent by certified or official bank check (or the equivalent
thereof acceptable to the Company) in an amount at least equal to the par value of the shares covered by the award.

 

(b)                                             Issuance of Stock Certificate(s).   Promptly after a grantee accepts a restricted stock award, the Company or
its exchange agent shall issue to the
grantee a stock certificate or stock certificates for the shares of Common
Stock covered by the award or shall establish an account evidencing ownership
of the stock in uncertificated form. 
Upon the issuance of such stock certificate(s), or establishment of such
account, the grantee shall have the rights of a stockholder with respect to the
restricted stock, subject to: (i) the nontransferability restrictions and
forfeiture provision described in paragraphs
(d) and (e) of this Section 2.7; (ii) in the Administrator’s discretion, to a
requirement that any dividends paid on such shares shall be held in escrow until all restrictions on such shares have lapsed;
and (iii) any other restrictions and conditions contained in the applicable
restricted stock agreement.

 

(c)                                              Custody of Stock Certificate(s).  Unless the Administrator shall otherwise
determine, any stock certificates issued evidencing shares of restricted stock shall remain in the possession of
the Company until such shares are free
of any restrictions specified in the applicable restricted stock agreement. 
The Administrator may direct that such stock certificate(s) bear a
legend setting forth the applicable
restrictions on transferability.

 

(d)                                           Nontransferability.   Shares of
restricted stock may not be sold, assigned, transferred, pledged or otherwise
encumbered or disposed of except as otherwise specifically provided in this
Plan or the applicable restricted
stock agreement.  The Administrator at
the time of grant shall specify the
date or dates (which may depend upon or be related to the attainment of
performance goals and other conditions) on which the nontransferability of the
restricted stock shall lapse.

 

(e)                                              Consequence of Termination of Employment.  A grantee’s termination of employment for any
reason (including death) shall cause the immediate forfeiture of all shares of
restricted stock that have not yet vested as of the date of such termination of
employment.  All dividends paid on such shares also shall be forfeited, whether by
termination of any escrow arrangement
under which such dividends are held, by the grantee’s repayment of dividends he
received directly, or otherwise.

 

2.8                                 Grant of Unrestricted Stock

 

The Administrator may grant (or sell at a purchase price at least equal
to par value) shares of Common Stock free of restrictions under the Plan, to
such key persons and in such amounts and
subject to such forfeiture provisions as the Administrator shall
determine in its sole discretion.  Shares
may be thus granted or sold in respect of past services or other valid
consideration.

 

10

 

2.9                                 Grant of Performance Shares

 

(a)                                              Performance Share Grants.  The Administrator may grant performance share
awards to such key persons, and in such amounts and subject to such vesting and
forfeiture provisions and other terms and conditions, as the Administrator
shall in its sole discretion determine, subject to the provisions of the
Plan.  Such an award shall entitle the
grantee to acquire shares of Common Stock, or to be paid the value thereof in
cash, as the Administrator shall determine, if specified performance goals are
met.  Performance shares may be awarded independently of, or in connection with,
any other award under the Plan.  A grantee shall have no rights with respect
to a performance share award unless such grantee accepts the award by accepting
delivery of an Award Agreement at such time and in such form as the
Administrator shall determine.

 

(b)                                             Stockholder Rights.  The grantee of a performance share award will
have the rights of a stockholder only as to shares for which a stock
certificate has been issued pursuant to the award and not with respect to any
other shares subject to the award.

 

(c)                                              Consequence of Termination of Employment.   Except as may otherwise be provided by the
Administrator at any time prior to a grantee’s termination of employment, the rights of a grantee of a performance share
award shall automatically terminate
upon the grantee’s termination of employment by the Company or Service
Provider, as applicable, and its subsidiaries for any reason (including death).

 

(d)                                             Exercise Procedures; Automatic Exercise.  At the discretion of the Administrator, the applicable Award Agreement
may set out the procedures to be
followed in exercising a performance share award or it may provide that such
exercise shall be made automatically after satisfaction of the applicable
performance goals.

 

(e)                                              Tandem Grants; Effect on Exercise.  Except as otherwise specified by the Administrator, (i) a performance
share award granted in tandem with an
option may be exercised only while the option is exercisable, (ii) the exercise
of a performance share award granted in tandem with any other award shall
reduce the number of shares subject to such other award in the manner specified
in the applicable Award Agreement, and (iii) the exercise of any award granted
in tandem with a performance share award shall reduce the number of shares
subject to the latter in the manner specified in the applicable Award
Agreement.

 

(f)                                                Nontransferability. 
 Performance
shares may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as otherwise specifically provided in this Plan or
the applicable Award Agreement.  The Administrator at the time of grant shall
specify the date or dates (which may depend upon or be related to the
attainment of performance goals and
other conditions) on which the nontransferability of the performance shares
shall lapse.

 

11

 

ARTICLE III

Miscellaneous

 

3.1                                 Amendment of the Plan; Modification of Awards

 

(a)                                              Amendment of the Plan.  The Board may from time to time suspend, discontinue, revise or amend the Plan in
any respect whatsoever, except that no such amendment shall materially impair any
rights or materially increase any
obligations under any award theretofore made under the Plan without the consent
of the grantee (or, upon the grantee’s death, the person having the right to
exercise the award).  For purposes of
this Section 3.1, any action of the Board or the Administrator that in any way alters
or affects the tax treatment of any award shall not be considered to materially
impair any rights of any grantee.

 

(b)                                           Stockholder Approval
Requirement.  Stockholder approval shall
be required with respect to any amendment to the Plan that (i) increases the
aggregate number of shares that may be issued pursuant to incentive stock
options or changes the class of employees eligible to receive such options; or
(ii) materially increases the benefits under the Plan to persons whose
transactions in Common Stock are subject to section 16(b) of the 1934 Act or
increases the benefits under the Plan to someone who is, materially increases
the number of shares which may be issued to such persons, or materially
modifies the eligibility requirements affecting such persons.

 

(c)                                            Modification of Awards.  The Administrator may cancel any award under
the Plan.  The Administrator also may
amend any outstanding Award Agreement, including,
without limitation, by amendment which would: (i) accelerate the time or times at which the award becomes unrestricted
or may be exercised, provided that, except as and to the extent that the
Administrator may otherwise provide pursuant
to Section 2.5, 3.7 or 3.8, no option, stock appreciation right or restricted
stock unit shall be exercisable prior
to the first anniversary of its date of grant; (ii) waive or amend any goals,
restrictions or conditions set forth in the Agreement; or (iii) waive or amend
the operation of Section 2.5 with respect to the termination of the award upon
termination of employment.  However, any
such cancellation or amendment (other than an amendment pursuant to
Sections 3.7 or 3.8(b)) that materially impairs the rights or materially
increases the obligations of a grantee
under an outstanding award shall be made only with the consent of the grantee (or, upon the grantee’s
death, the person having the right to exercise the award).

 

3.2                                 Consent Requirement

 

(a)                                              No Plan Action Without Required Consent.   If the Administrator shall at any time
determine that any Consent (as hereinafter defined) is necessary or desirable as a condition of, or in
connection with, the granting of any
award under the Plan, the issuance or purchase of shares or other rights thereunder, or the taking of any other action
thereunder (each such action being
hereinafter referred to as a “Plan Action”), then such Plan Action shall not be
taken, in whole or in part, unless and until such Consent shall have been
effected or obtained to the full satisfaction of the Administrator.

 

(b)                                             Consent Defined. 
The term “Consent” as used herein with respect to any Plan Action means
(i) any and all listings, registrations or qualifications in respect thereof
upon any securities exchange or under any federal, state or local law, rule or
regulation, (ii) any and all written agreements
and representations by the grantee with respect to the

 

12

 

disposition of shares, or with respect to any other matter, which
the Administrator shall deem necessary or desirable to comply with the terms of
any such listing, registration or qualification or to obtain an exemption from
the requirement that any such listing, qualification or registration be made
and (iii) any and all consents, clearances and approvals in respect of a Plan Action
by any governmental or other regulatory bodies.

 

3.3                                 Nonassignability

 

Except as provided in Sections
2.5(e), 2.6, 2.7(d) and 2.9(f): (a) no
award or right granted to any person under the Plan or under any Award
Agreement shall be assignable or transferable other than by will or by the laws
of descent and distribution; and (b) all rights granted under the Plan or any Award Agreement shall be exercisable during the
life of the grantee only by the
grantee or the grantee’s legal representative.

 

3.4                                 Requirement of Notification of Election Under
Section 83(b) of the Code

 

If any grantee shall, in connection with the acquisition
of shares of Common Stock under the Plan, make the election permitted under
section 83(b) of the Code (i.e., an election to include in gross income in the
year of transfer the amounts specified in section 83(b)), such grantee shall
notify the Company of such election within 10 days of filing notice of the
election with the Internal Revenue Service, in addition to any filing and notification
required pursuant to regulations issued under the authority of Code section
83(b).

 

3.5                                 Requirement of Notification Upon Disqualifying
Disposition Under Section 421(b) of
the Code

 

Each Award Agreement with respect to an
incentive stock option shall require
the grantee to notify the Company of any disposition of shares of Common Stock issued pursuant to the exercise of such
option under the circumstances described in section 421(b) of the Code
(relating to certain disqualifying dispositions), within 10 days of such
disposition.

 

3.6                                 Withholding Taxes

 

(a)                                              With Respect to Cash Payments.  Whenever cash is to be paid pursuant to an
award under the Plan, the Company shall be entitled to deduct therefrom an amount sufficient in its opinion to
satisfy all federal, state and other
governmental tax withholding requirements related to such payment.

 

(b)                                             With Respect to Delivery of Common Stock.  Whenever shares of Common Stock are to be
delivered pursuant to an award under the Plan, the Company shall be entitled to require as a condition
of delivery that the grantee remit to
the Company an amount sufficient in the opinion of the Company to satisfy all
federal, state and other governmental tax withholding requirements related
thereto.  With the approval of the Administrator,
which the Administrator shall have sole discretion whether or not to give, the
grantee may satisfy the foregoing condition by electing to have the Company
withhold from delivery shares having a value equal to the amount of tax to be
withheld. Such shares shall be valued
at their Fair Market Value as of the date on which the amount of tax to be withheld is determined. Fractional share
amounts shall be settled in cash.  Such a withholding election may be made with
respect to all or any portion of the
shares to be delivered pursuant to an award.

 

13

 

3.7                                 Adjustment Upon Changes in Common Stock

 

(a)                                              Shares Available for Grants.  In
the event of any change in the number
of shares of Common Stock outstanding by reason of any stock dividend or split, reverse stock split, recapitalization,
merger, consolidation, combination or
exchange of shares or similar corporate change, the maximum number of shares of
Common Stock with respect to which the Administrator may grant awards under
Article II hereof, as described in Section 1.5(a), and the individual annual
limit described in Section 1.5(d), shall be appropriately adjusted by the
Administrator.  In the event of any
change in the number of shares of Common Stock outstanding by reason of any
other event or transaction, the Administrator may, but need not, make such
adjustments in the number and class of shares of Common Stock with respect to which awards: (i) may be
granted under Article II hereof and (ii) granted to any one employee of the Company
or a subsidiary during any one
calendar year, in each case as the Administrator may deem appropriate.

 

(b)                                             Outstanding Restricted Stock and Performance
Shares.  Unless the Administrator in its sole and absolute discretion
otherwise determines, any securities or
other property (including dividends paid in cash) received by a grantee with
respect to a share of restricted stock, the issue date with respect to which
occurs prior to such event, but which has not vested as of the date of such
event, as a result of any dividend, stock split, reverse stock split,
recapitalization, merger, consolidation, combination, exchange of shares or otherwise will not vest until such share of
restricted stock vests, and shall be
promptly deposited with the Company or other custodian designated pursuant to
Section 2.7(c) hereof.

 

The Administrator may, in its absolute discretion, adjust any grant of
shares of restricted stock, the issue date with respect to which has not occurred as of the date of the occurrence of any of
the following events, or any  grant of
performance shares, to reflect any dividend, stock split, reverse stock  split, recapitalization, merger, consolidation,
combination, exchange of shares or similar corporate change as the Administrator may deem appropriate to
prevent the enlargement or dilution of
rights of grantees.

 

(c)                                              Outstanding Options, Stock Appreciation Rights and
Dividend Equivalent Rights—Increase or
Decrease in Issued Shares Without Consideration.  Subject
to any required action by the stockholders of the Company, in the event of any increase or decrease in the number of
issued shares of Common Stock
resulting from a subdivision or consolidation of shares of Common Stock or the
payment of a stock dividend (but only on the shares of Common Stock), or any other increase or decrease in the number of such
shares effected without receipt of
consideration by the Company, the Administrator shall proportionally adjust the
number of shares of Common Stock subject to each outstanding option and stock
appreciation right, and the exercise price-per-share of Common Stock of each such option and stock appreciation right and the
number of any related dividend
equivalent rights.

 

(d)                                             Outstanding Options, Stock Appreciation Rights, Restricted
Stock Units and Dividend Equivalent Rights—Certain Mergers.  Subject to any required action by the
stockholders of the Company, in the event that the Company shall be the
surviving corporation in any merger or consolidation (except a merger or consolidation as a result of which the holders of
shares of Common Stock receive
securities of another corporation), each option, stock appreciation right and
dividend equivalent right outstanding on the date of such merger or consolidation shall pertain to and apply to the
securities which a holder of the
number of shares of Common Stock subject to such option, stock appreciation
right,

 

14

 

restricted stock unit or dividend equivalent
right would have received in such merger or consolidation.

 

(e)                                              Outstanding Options, Stock Appreciation Rights,
Restricted Stock Units and Dividend Equivalent Rights—Certain Other
Transactions.  In the event of (i) a
dissolution or liquidation of the Company, (ii) a sale of all or substantially
all of the Company’s assets, (iii) a merger or consolidation involving the
Company in which the Company is not the surviving corporation or (iv) a merger
or consolidation involving the Company in which the Company is the surviving
corporation but the holders of shares of Common Stock receive securities of another corporation and/or other property,
including cash, the Administrator shall, in its absolute discretion, have the power to:

 

(A)                              cancel, effective
immediately prior to the occurrence of such event, each option, stock
appreciation right and restricted stock unit (including each dividend
equivalent right related thereto) outstanding immediately prior to such event
(whether or not then exercisable), and, in full consideration of such cancellation,
pay to the grantee to whom such option or stock appreciation right was granted
an amount in cash, for each share of Common Stock subject to such option or
stock appreciation right, respectively, equal to the excess of (x) the value,
as determined by the Administrator in its absolute discretion, of the property
(including cash) received by the holder of a share of Common Stock as a result
of such event over (y) the exercise price of such option or stock appreciation
right; or

 

(B)                                provide for the exchange of each option, stock
appreciation right and restricted stock unit (including any related dividend
equivalent right) outstanding immediately prior to such event (whether or not
then exercisable) for an option on, stock appreciation right, restricted stock
unit and dividend equivalent right with respect to, as appropriate, some or all
of the property which a holder of the number of shares of Common Stock subject
to such option, stock appreciation right or restricted stock unit would have
received and, incident thereto, make an equitable adjustment as determined by
the Administrator in its absolute discretion in the exercise price of the
option, stock appreciation right or
restricted stock unit, or the number of shares or amount of property subject to the option, stock appreciation right, restricted
stock unit or dividend equivalent right or, if appropriate, provide for a cash
payment to the grantee to whom such option, stock appreciation right or
restricted stock unit was granted in partial consideration for the exchange of
the option, stock appreciation right or restricted stock unit.

 

(f)                                                Outstanding Options, Stock Appreciation Rights,
Restricted Stock Units and Dividend Equivalent Rights—Other Changes.  In the
event of any change in the capitalization of the Company or a corporate
change other than those specifically referred
to in Sections 3.7(c), (d) or (e) hereof, the Administrator may, in its
absolute discretion, make such adjustments in the number and class of shares
subject to options, stock appreciation rights, restricted stock units and
dividend equivalent rights outstanding
on the date on which such change occurs and in the per-share
exercise price of each such option, stock appreciation right and restricted stock unit as the Administrator may consider appropriate to prevent
dilution or enlargement of rights.  In addition, if and to the extent the
Administrator determines it is appropriate, the Administrator may elect to
cancel each option, stock appreciation right and restricted stock unit (including
each dividend equivalent right related thereto) outstanding immediately prior
to such event (whether or not then exercisable), and, in full consideration of
such cancellation, pay to the grantee to whom such option, stock appreciation right or

 

15

 

restricted stock
unit was granted an amount in cash, for each share of Common Stock
subject to such option, stock appreciation right or restricted stock unit,
respectively, equal to the excess of
(i) the Fair Market Value of Common Stock on the date of such cancellation over
(ii) the exercise price of such option, stock appreciation right or restricted
stock unit.

 

(g)                                             No Other Rights. 
Except as expressly provided in
the Plan, no grantee shall have any
rights by reason of any subdivision or consolidation of shares of stock of any
class, the payment of any dividend, any increase or decrease in the number of
shares of stock of any class or any dissolution, liquidation, merger or
consolidation of the Company or any other corporation.  Except
as expressly provided in the Plan, 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
thereof shall be made with respect to, the number of shares of Common Stock
subject to an award or the exercise price of any option or stock appreciation
right.

 

3.8                                 Change in Control

 

(a)                                          Change in Control Defined.   For purposes of this Section 3.8, “Change in
Control” shall mean the occurrence of any of the following:

 

(i)                                     any person or “group” (within the meaning of
Section 13(d)(3) of the 1934 Act), other than entities which the Chairman
of the Board directly or indirectly controls (as defined in Rule 12b-2 under
the 1934 Act), acquiring “beneficial ownership” (as defined in Rule 13d-3 under
the 1934 Act), directly or indirectly, of fifty percent (50%) or more of the
aggregate voting power of the capital stock ordinarily entitled to elect
directors of the Company;

 

(ii)                                  the sale of all or substantially all of the
Company’s assets in one or more related transactions to a person other than
such a sale to a subsidiary of the Company which does not involve a change in
the equity holdings of the Company or to an entity which the Chairman directly
or indirectly controls; or

 

(iii)                               any merger, consolidation, reorganization or
similar event of the Company or any of its subsidiaries, as a result of which
the holders of the voting stock of the Company immediately prior to such
merger, consolidation, reorganization or similar event do not directly or
indirectly hold at least fifty-one percent (51%) of the aggregate voting power
of the capital stock of the surviving entity.

 

(b)                                             Effect of a Change in Control.  Unless the Administrator provides otherwise
in a Award Agreement, upon the occurrence of a Change in Control:

 

(i)                                     notwithstanding any
other provision of this Plan, any award then outstanding shall become fully
vested and any award in the form of an option, stock appreciation right or restricted
stock unit shall be immediately exercisable;

 

(ii)                                  to the extent permitted by law, the Administrator
may, in its sole discretion, amend any Award Agreement in such manner as it
deems appropriate;

 

16

 

(iii)                               a grantee who incurs a termination of employment
for any reason, other than a dismissal
for cause, concurrent with or within one year following the Change in Control
may exercise any outstanding option, stock appreciation right or restricted stock unit, but only to the extent that
the grantee was entitled to exercise the award on his termination of employment
date, until the earlier of (A) the original expiration date of the award and
(B) the later of (x) the date provided for under the terms of Section 2.5
without reference to this Section 3.8(b)(iii) and (y) the first anniversary of
the grantee’s termination of
employment.

 

(c)                                              Miscellaneous.  Whenever deemed appropriate by the
Administrator, any action referred to in paragraph (b)(ii) of this Section 3.8
may be made conditional upon the consummation of the applicable Change in
Control transaction.

 

3.9                                 Right of Discharge Reserved

 

Nothing in the Plan or in any
Award Agreement shall confer upon any grantee the right to continue his employment with the Company or Service
Provider or affect any right that the
Company or Service Provider may have to terminate such employment.

 

3.10                           Non-Uniform Determinations

 

The Administrator’s determinations under the
Plan need not be uniform and may be made by it selectively among persons who
receive, or who are eligible to receive, awards under the Plan (whether or not
such persons are similarly situated).  Without limiting the generality of the
foregoing, the Administrator shall be
entitled, among other things, to make non-uniform and selective determinations,
and to enter into non-uniform and selective Award Agreements, as to (a) the
persons to receive awards under the Plan, and (b) the terms and provisions of
awards under the Plan.

 

3.11                           Other Payments or Awards

 

Nothing contained in the Plan shall be deemed
in any way to limit or restrict the Company from making any award or payment to
any person under any other
plan, arrangement or understanding, whether now existing or hereafter in effect.

 

3.12                           Headings

 

Any section, subsection, paragraph or other
subdivision headings contained
herein are for the purpose of convenience only and are not intended to expand, limit or otherwise define the contents of
such subdivisions.

 

3.13                           Effective Date and Term of Plan

 

(a)                                              Adoption; Stockholder Approval.  The Plan was adopted by the Board and
although the Company intends to obtain approval of the Plan by the Company’s
stockholders within the time period required to allow grants of options hereunder to qualify as incentive
stock options, awards under the Plan
prior to such stockholder approval may, but need not, be made subject to such
approval.

 

(b)                                             Termination
of Plan.  Unless sooner terminated by the
Board or pursuant to Paragraph (a) above, the
provisions of the Plan respecting the grant of incentive stock options

 

17

 

shall terminate on the tenth anniversary of
the adoption of the Plan by the Board, and no incentive stock option awards
shall thereafter be made under the Plan. 
All such awards made under the Plan prior to its termination shall remain in effect until such awards have been
satisfied or terminated in accordance with the terms and provisions of
the Plan and the applicable Award Agreements.

 

3.14                           Restriction on Issuance of Stock Pursuant to Awards

 

The Company shall not permit any shares of
Common Stock to be issued pursuant
to Awards granted under the Plan unless such shares of Common Stock are fully paid and non-assessable under applicable
law.

 

3.15                           Governing Law

 

Except to the extent preempted by any
applicable federal law, the Plan will be construed and administered in
accordance with the laws of the State of New York, without giving effect to principles of conflict of laws.

 

18Exhibit
4.1

 

	
  NUMBER

  	
   

  	
  SHARES

  
	
   

  	
   

  	
   

  
	
  0

  	
  COMMON SHARES

  	
   

  

 

 

Incorporated
under the Laws of the Republic of the Marshall Islands

 

GENCO
SHIPPING & TRADING LIMITED

 

100,000,000
Common Shares — Par Value U.S. $0.01 each

25,000,000 Preferred Shares — Par Value U.S. $0.01 each

 

	
  This Certifies that

  	
   

  	
  is
  the owner of

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

fully
paid and non-assessable Common Shares, par value U.S. $0.01 each, of

 

GENCO
SHIPPING & TRADING LIMITED

 

transferable on the books of the Corporation
by the holder hereof in person or by duly authorized Attorney upon surrender of
this Certificate properly endorsed.

 

The Corporation will furnish to any
shareholder upon request and without charge a full statement of the
designation, relative rights, preferences and limitations of each class and/or series
thereof authorized to be issued by the Corporation.

 

IN WITNESS WHEREOF, the
Corporation has caused this Certificate to be signed by its duly authorized
officers and its Corporate Seal to be hereunto affixed this                          
day of                           
, 20       .

 

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SEAL

  	
   

  	
   

  
	
  PRESIDENT

  	
   

  	
   

  	
   

  	
  CHIEF
  FINANCIAL OFFICER

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