Exhibit 10.26
SEACOR SMIT INC.
2003 SHARE INCENTIVE PLAN
1. PURPOSE. SEACOR SMIT Inc. 2003 Share Incentive Plan (the "Plan") is
intended to provide incentives which will attract, retain and
motivate highly competent persons as officers and key employees of,
and consultants to, SEACOR SMIT Inc. (the "Company") and its
subsidiaries and affiliates, by providing them opportunities to
acquire shares of the Common Stock, par value $.01 per share, of the
Company ("Common Stock") or to receive monetary payments based on the
value of such shares pursuant to the Benefits (as defined below)
described herein. Additionally, the Plan is intended to assist in
further aligning the interests of the Company's officers, key
employees and consultants to those of its other stockholders.
2. ADMINISTRATION.
(a) The Plan will be administered by a committee (the
"Committee") appointed by the Board of Directors of the
Company from among its members (which may be the
Compensation Committee) and shall be comprised, unless
otherwise determined by the Board of Directors, solely of
not less than two members who shall be (i) "Non-Employee
Directors" within the meaning of Rule 16b-3(b)(3) (or any
successor rule) promulgated under the Securities Exchange
Act of 1934, as amended (the "Exchange Act") and (ii)
"outside directors" within the meaning of Treasury
Regulation Section 1.162-27(e)(3) under Section 162(m) of
the Internal Revenue Code of 1986, as amended (the
"Code"). The Committee is authorized, subject to the
provisions of the Plan, to establish such rules and
regulations as it deems necessary for the proper
administration of the Plan and to make such determinations
and interpretations and to take such action in connection
with the Plan and any Benefits granted hereunder as it
deems necessary or advisable. All determinations and
interpretations made by the Committee shall be binding and
conclusive on all participants and their legal
representatives. No member of the Committee and no
employee of the Company shall be liable for any act or
failure to act hereunder, except in circumstances
involving his or her bad faith, gross negligence or
willful misconduct, or for any act or failure to act
hereunder by any other member or employee or by any agent
to whom duties in connection with the administration of
this Plan have been delegated. The Company shall indemnify
members of the Committee and any agent of the Committee
who is an employee of the Company, a subsidiary or an
affiliate against any and all liabilities or expenses to
which they may be subjected by reason of any act or
failure to act with respect to their duties on behalf of
the Plan, except in circumstances involving such person's
bad faith, gross negligence or willful misconduct.
(b) 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 so delegated duties, may employ one or more
persons to render advice with respect to any
responsibility the Committee or such person may have under
the Plan. The Committee may employ such legal or other
counsel, consultants and agents as it may deem desirable
for the administration of the Plan and may rely upon any
opinion or computation received from any such counsel,
consultant or agent. Expenses incurred by the Committee in
the engagement of such counsel, consultant or agent shall
be paid by the Company, or the subsidiary or affiliate
whose employees have benefited from the Plan, as
determined by the Committee.
3. PARTICIPANTS. Participants will consist of such officers and key
employees of, and such consultants to, the Company and its
subsidiaries and affiliates as the Committee in its sole discretion
determines to be significantly responsible for the success and future
growth and profitability of the Company and whom the Committee may
designate from time to time to receive Benefits under the Plan.
Designation of a participant in any year shall not require the
Committee to designate such person to receive a Benefit in any other
year or, once designated, to receive the same type or amount of
Benefit as granted to the participant in any other year. The
Committee shall consider such factors as it deems pertinent in
selecting participants and in determining the type and amount of
their respective Benefits.
4. TYPE OF BENEFITS. Benefits under the Plan may be granted in any one
or a combination of (a) Stock Options, (b) Stock Appreciation Rights,
(c) Stock Awards, (d) Performance Awards and (e) Stock Units (each as
described below, and collectively, the "Benefits"). Stock Awards,
Performance Awards, and Stock Units may, as determined by the
Committee in its discretion, constitute Performance-Based Awards, as
described in Section 11 below. Benefits shall be evidenced by
agreements (which need not be identical) in such forms as the
Committee may from time to time approve; provided, however, that in
the event of any conflict between the provisions of the Plan and any
such agreements, the provisions of the Plan shall prevail.
5. COMMON STOCK AVAILABLE UNDER THE PLAN.
(a) Subject to the provisions of this Section 5 and any
adjustments made in accordance with Section 13 hereof, the
maximum number of shares of Common Stock that may be
delivered to participants (including permitted assignees)
and their beneficiaries under this Plan shall be 1,000,000
shares of Common Stock (subject to adjustments made in
accordance with Section 13 hereof), which may be
authorized and unissued or treasury shares.
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(b) Any shares of Common Stock covered by a Benefit (or
portion of a Benefit) granted under the Plan, which is
forfeited or canceled, expires or, in the case of a
Benefit other than a Stock Option, is settled in cash,
shall be deemed not to have been delivered for purposes of
determining the maximum number of shares of Common Stock
available for delivery under the Plan. The preceding
sentence shall apply only for the purposes of determining
the aggregate number of shares of Common Stock subject to
Benefits and that are available for delivery under the
Plan, but shall not apply for purposes of determining
pursuant to Section 5(d) the maximum number of shares of
Common Stock with respect to which Benefits (including the
maximum number of shares of Common Stock subject to Stock
Options and Stock Appreciation Rights) may be granted or
measured to an individual participant under the Plan.
(c) If any shares of Common Stock are tendered to the Company,
either actually or by attestation or withholding, as full,
or partial payment of the exercise price or any tax
withholding in connection with the exercise of a Stock
Option or Stock Appreciation Right or the vesting of any
other Benefit granted under this Plan or any prior plan of
the Company, only the number of shares of Common Stock
issued net of the shares of Common Stock tendered shall be
deemed delivered for purposes of determining the maximum
number of shares of Common Stock subject to Benefits that
are available for delivery under the Plan. Further, shares
of Common Stock delivered under the Plan in settlement,
assumption or substitution of outstanding awards (or
obligations to grant future awards) under the plans or
arrangements of another entity shall not decrease the
number of shares of Common Stock subject to Benefits and
shall not reduce the maximum number of shares of Common
Stock available for delivery under the Plan, to the extent
that such settlement, assumption or substitution as a
result of the Company or its subsidiaries or affiliates
acquiring another entity (or an interest in another
entity). This Section 5(c) shall apply only for purposes
of determining the aggregate number of shares of Common
Stock subject to Benefits and that are available for
delivery under the Plan, but shall not apply for purposes
of determining pursuant to Section 5(d) the maximum number
of shares of Common Stock (x) with respect to which
Benefits (including the maximum number of shares of Common
Stock subject to Stock Options and Stock Appreciation
Rights) may be granted or measured to an individual
participant under the Plan or (y) that may be delivered
through Stock Options under the Plan.
(d) The maximum number of shares of Common Stock with respect
to which Benefits may be granted or measured to any
individual participant under the Plan during the term of
the Plan, and the maximum number of shares of Common Stock
with respect to which Stock Options and Stock Appreciation
Rights may be granted to an individual participant under
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the Plan during the term of the Plan shall not exceed
1,000,000 shares of Common Stock (in each case, subject to
adjustments made in accordance with Section 13 hereof).
6. STOCK OPTIONS. Stock Options will consist of awards from the Company
that will enable the holder to purchase a number of shares of Common
Stock, at set terms. Stock Options may be "incentive stock options"
("Incentive Stock Options"), within the meaning of Section 422 of the
Code, or Stock Options which do not constitute Incentive Stock
Options ("Nonqualified Stock Options"). The Committee will have the
authority to grant to any participant one or more Incentive Stock
Options, Nonqualified Stock Options, or both types of Stock Options
(in each case with or without Stock Appreciation Rights). Each Stock
Option shall be subject to such terms and conditions consistent with
the Plan as the Committee may impose from time to time, subject to
the following limitations:
(a) EXERCISE PRICE. Each Stock Option granted hereunder shall
have such per share exercise price as the Committee may
determine at the date of grant; provided, however, subject
to subsection (d) below, that the per-share exercise price
shall not be less than 100% of the Fair Market Value (as
defined below) of the Common Stock on the date the Stock
Option is granted.
(b) PAYMENT OF EXERCISE PRICE. The option exercise price may
be paid in cash or, in the discretion of the Committee, by
the delivery of shares of Common Stock of the Company then
owned by the participant, by the withholding of shares of
Common Stock for which a Stock Option is exercisable or by
a combination of these methods. In the discretion of the
Committee, payment may also be made by delivering a
properly executed exercise notice to the Company together
with a copy of irrevocable instructions to a broker to
deliver promptly to the Company the amount of sale or loan
proceeds to pay the exercise price. To facilitate the
foregoing, the Company may enter into agreements for
coordinated procedures with one or more brokerage firms.
The Committee may prescribe any other method of paying the
exercise price that it determines to be consistent with
applicable law and the purpose of the Plan, including,
without limitation, in lieu of the exercise of a Stock
Option by delivery of shares of Common Stock of the
Company then owned by a participant, providing the Company
with a notarized statement attesting to the number of
shares owned, where upon verification by the Company, the
Company would issue to the participant only the number of
incremental shares to which the participant is entitled
upon exercise of the Stock Option. In determining which
methods a participant may utilize to pay the exercise
price, the Committee may consider such factors as it
determines are appropriate.
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(c) EXERCISE PERIOD. Stock Options granted under the Plan
shall be exercisable at such time or times and subject to
such terms and conditions as shall be determined by the
Committee; provided, however, that no Stock Option shall
be exercisable later than ten years after the date it is
granted except in the event of a participant's death, in
which case, the exercise period of such participant's
Stock Options may be extended beyond such period but no
later than one year after the participant's death. All
Stock Options shall terminate at such earlier times and
upon such conditions or circumstances as the Committee
shall in its discretion set forth in such option agreement
at the date of grant.
(d) LIMITATIONS ON INCENTIVE STOCK OPTIONS. Incentive Stock
Options may be granted only to participants who are
employees of the Company or one of its subsidiaries
(within the meaning of Section 424(f) of the Code) at the
date of grant. The aggregate Fair Market Value (determined
as of the time the Stock Option is granted) of the Common
Stock with respect to which Incentive Stock Options are
exercisable for the first time by a participant during any
calendar year (under all option plans of the Company and
of any parent corporation or subsidiary corporation (as
defined in Sections 424(e) and (f) of the Code,
respectively)) shall not exceed $100,000. For purposes of
the preceding sentence, Incentive Stock Options will be
taken into account in the order in which they are granted.
The per-share exercise price of an Incentive Stock Option
shall not be less than 100% of the Fair Market Value of
the Common Stock on the date of grant, and no Incentive
Stock Option may be exercised later than ten years after
the date it is granted; provided, however, Incentive Stock
Options may not be granted to any participant who, at the
time of grant, owns stock possessing (after the
application of the attribution rules of Section 424(d) of
the Code) more than 10% of the total combined voting power
of all classes of stock of the Company or any parent or
subsidiary corporation of the Company, unless the exercise
price is fixed at not less than 110% of the Fair Market
Value of the Common Stock on the date of grant and the
exercise of such option is prohibited by its terms after
the expiration of five years from the date of grant of
such option. In addition, no Incentive Stock Option may be
issued to a participant in tandem with a Nonqualified
Stock Option.
(e) POST-EMPLOYMENT EXERCISES. In addition to any other
conditions to which the participant is subject, the
exercise of any Stock Option after termination of
employment shall be subject to satisfaction of the
conditions precedent that the participant neither (i)
competes with, or takes other employment with or renders
services to a competitor of, the Company, its subsidiaries
or affiliates without the written consent of the Company,
nor (ii) conducts himself or herself in a manner adversely
affecting the Company.
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7. STOCK APPRECIATION RIGHTS.
(a) The Committee may, in its discretion, grant Stock
Appreciation Rights to the holders of any Stock Options
granted hereunder. In addition, Stock Appreciation Rights
may be granted independently of, and without relation to,
Stock Options. A Stock Appreciation Right means a right to
receive a payment, in cash, Common Stock or a combination
thereof, in an amount equal to the excess of (x) the Fair
Market Value, or other specified valuation, of a specified
number of shares of Common Stock on the date the right is
exercised over (y) the Fair Market Value, or other
specified valuation (which shall be no less than the Fair
Market Value) of such shares of Common Stock on the date
the right is granted, all as determined by the Committee;
provided, however, that if a Stock Appreciation Right is
granted in tandem with or in substitution for a Stock
Option, the designated Fair Market Value in the award
agreement may be the Fair Market Value on the date such
Stock Option was granted. Each Stock Appreciation Right
shall be subject to such terms and conditions as the
Committee shall impose from time to time.
(b) Stock Appreciation Rights granted under the Plan shall be
exercisable at such time or times and subject to such
terms and conditions as shall be determined by the
Committee; provided, however, that no Stock Appreciation
Rights shall be exercisable later than ten years after the
date it is granted except in the event of a participant's
death, in which case, the exercise period of such
participant's Stock Appreciation Rights may be extended
beyond such period but no later than one year after the
participant's death. All Stock Appreciation Rights shall
terminate at such earlier times and upon such conditions
or circumstances as the Committee shall in its discretion
set forth in such Stock Appreciation Right at the date of
grant.
(c) The exercise of any Stock Appreciation Right after
termination of employment shall be subject to satisfaction
of the conditions precedent that the participant neither
(i) competes with, or takes other employment with or
renders services to a competitor of, the Company, its
subsidiaries or affiliates without the written consent of
the Company, nor (ii) conducts himself or herself in a
manner adversely affecting the Company.
8. STOCK AWARDS. The Committee may, in its discretion, grant Stock
Awards (which may include mandatory payment of bonus incentive
compensation in stock) consisting of Common Stock issued or
transferred to participants with or without other payments therefor.
Stock Awards may be subject to such terms and conditions as the
Committee determines appropriate, including, without limitation,
restrictions on the sale or other disposition of such shares, the
right of the Company to reacquire such shares for no consideration
upon termination of the participant's employment or service within
specified periods, and may constitute Performance-Based Awards, as
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described below. The Committee may require the participant to deliver
a duly signed stock power, endorsed in blank, relating to the Common
Stock covered by such Stock Award. The Committee may also require
that the stock certificates evidencing such shares be held in custody
or bear restrictive legends until the restrictions thereon shall have
lapsed. The Stock Award shall specify whether the participant shall
have, with respect to the shares of Common Stock subject to a Stock
Award, all of the rights of a holder of shares of Common Stock of the
Company, including the right to receive dividends and to vote the
shares.
9. PERFORMANCE AWARDS.
(a) Performance Awards may be granted to participants at any
time and from time to time, as shall be determined by the
Committee. Performance Awards may, as determined by the
Committee in its sole discretion, constitute
Performance-Based Awards. The Committee shall have
complete discretion in determining the number, amount and
timing of awards granted to each participant. Such
Performance Awards may be in the form of shares of Common
Stock or Stock Units. Performance Awards may be awarded as
short-term or long-term incentives. With respect to those
Performance Awards that are intended to constitute
Performance-Based Awards, the Committee shall set
performance targets at its discretion which, depending on
the extent to which they are met, will determine the
number and/or value of Performance Awards that will be
paid out to the participants, and may attach to such
Performance Awards one or more restrictions. Performance
targets may be based upon, without limitation,
Company-wide, divisional and/or individual performance.
(b) With respect to those Performance Awards that are not
intended to constitute Performance-Based Awards, the
Committee shall have the authority at any time to make
adjustments to performance targets for any outstanding
Performance Awards which the Committee deems necessary or
desirable unless at the time of establishment of goals the
Committee shall have precluded its authority to make such
adjustments.
(c) Payment of earned Performance Awards shall be made in
accordance with terms and conditions prescribed or
authorized by the Committee. The participant may elect to
defer, or the Committee may require or permit the deferral
of, the receipt of Performance Awards upon such terms as
the Committee deems appropriate.
10. STOCK UNITS.
(a) The Committee may, in its discretion, grant Stock Units to
participants hereunder. The Committee shall determine the
criteria for the vesting of Stock Units and may provide
for payment in shares of Common Stock, in cash or in any
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combination of shares of Common Stock and cash, at such
time as the award agreement shall specify. Stock Units may
constitute Performance-Based Awards. Shares of Common
Stock issued pursuant to this Section 10 may be issued
with or without other payments therefor as may be required
by applicable law or such other consideration as may be
determined by the Committee. The Committee shall determine
whether a participant granted a Stock Unit shall be
entitled to a Dividend Equivalent Right (as defined
below).
(b) Upon vesting of a Stock Unit, unless the Committee has
determined to defer payment with respect to such Stock
Unit or a participant has elected to defer payment under
subsection (c) below, shares of Common Stock representing
the Stock Units shall be distributed to the participant
unless the Committee, with the consent of the participant,
provides for the payment of the Stock Units in cash or
partly in cash and partly in shares of Common Stock equal
to the value of the shares of Common Stock which would
otherwise be distributed to the participant.
(c) Prior to the year with respect to which a Stock Unit may
vest, the Committee may, in its discretion, permit a
participant to elect not to receive shares of Common Stock
and/or cash, as applicable, upon the vesting of such Stock
Unit and for the Company to continue to maintain the Stock
Unit on its books of account. In such event, the value of
a Stock Unit shall be payable in shares of Common Stock
and/or cash, as applicable, pursuant to the agreement of
deferral.
(d) A "Stock Unit" means a notional account representing one
share of Common Stock. A "Dividend Equivalent Right" means
the right to receive the amount of any dividend paid on
the share of Common Stock underlying a Stock Unit, which
shall be payable in cash or in the form of additional
Stock Units at the time or times specified by the
Committee or as the award agreement shall specify.
11. PERFORMANCE-BASED AWARDS. Certain Benefits granted under the Plan may
be granted in a manner such that the Benefits qualify for the
performance-based compensation exemption of Section 162(m) of the
Code ("Performance-Based Awards"). As determined by the Committee in
its sole discretion, either the vesting or the exercise of such
Performance-Based Awards shall be based on one or more business
criteria that apply to the individual participant, one or more
business units of the Company as a whole. The business criteria shall
be as follows, individually or in combination, adjusted in such
manner as the Committee shall determine: (i) net sales; (ii) pretax
income before allocation of corporate overhead and bonus; (iii)
budget; (iv) earnings per share; (v) net income; (vi) division, group
or corporate financial goals; (vii) return on stockholders' equity;
(viii) return on assets; (ix) attainment of strategic and operational
initiatives; (x) appreciation in and/or maintenance of the price of
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the Common Stock or any other publicly-traded securities of the
Company; (xi) market share; (xii) gross profits; (xiii) earnings
before interest and taxes; (xiv) earnings before interest, taxes,
depreciation and amortization; (xv) economic value-added models and
comparisons with various stock market indices; (xvi) reductions in
costs; or (xvii) any combination of the foregoing. In addition,
Performance-Based Awards may include comparisons to the performance
of other companies, such performance to be measured by one or more of
the foregoing business criteria. With respect to Performance-Based
Awards, (i) the Committee shall establish in writing (x) the
performance goals applicable to a given period, and such performance
goals shall state, in terms of an objective formula or standard, the
method for computing the amount of compensation payable to the
participant if such performance goals are obtained and (y) the
individual employees or class of employees to which such performance
goals apply no later than 90 days after the commencement of such
period (but in no event after 25% of such period has elapsed) and
(ii) no Performance-Based Awards shall be payable to or vest with
respect to, as the case may be, any participant for a given period
until the Committee certifies in writing that the objective
performance goals (and any other material terms) applicable to such
period have been satisfied. With respect to any Benefits intended to
qualify as Performance-Based Awards, after establishment of a
performance goal, the Committee shall not revise such performance
goal or increase the amount of compensation payable thereunder (as
determined in accordance with Section 162(m) of the Code) upon the
attainment of such performance goal. Notwithstanding the preceding
sentence, the Committee may reduce or eliminate the number of shares
of Common Stock or cash granted or the number of shares of Common
Stock vested upon the attainment of such performance goal.
12. FOREIGN LAWS. The Committee may grant Benefits to individual
participants who are subject to the tax laws of nations other than
the United States, which Benefits may have terms and conditions as
determined by the Committee as necessary to comply with applicable
foreign laws. The Committee may take any action which it deems
advisable to obtain approval of such Benefits by the appropriate
foreign governmental entity; provided, however, that no such Benefits
may be granted pursuant to this Section 12 and no action may be taken
which would result in a violation of the Exchange Act, the Code or
any other applicable law.
13. ADJUSTMENT PROVISIONS; CHANGE IN CONTROL.
(a) If there shall be any change in the Common Stock of the
Company, through merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, reverse
stock split, split up, spin-off, combination of shares,
exchange of shares, dividend in kind or other like change
in capital structure or distribution (other than normal
cash dividends) to stockholders of the Company, an
adjustment shall be made to each outstanding Stock Option
and Stock Appreciation Right such that each such Stock
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Option and Stock Appreciation Right shall thereafter be
exercisable for such securities, cash and/or other
property as would have been received in respect of the
Common Stock subject to such Stock Option or Stock
Appreciation Right had such Stock Option or Stock
Appreciation Right been exercised in full immediately
prior to such change or distribution, and such an
adjustment shall be made successively each time any such
change shall occur. In addition, in the event of any such
change or distribution, in order to prevent dilution or
enlargement of participants' rights under the Plan, the
Committee will have authority to adjust, in an equitable
manner, the number and kind of shares that may be issued
under the Plan, the number and kind of shares subject to
outstanding Benefits, the exercise price applicable to
outstanding Benefits, and the Fair Market Value of the
Common Stock and other value determinations applicable to
outstanding Benefits. Appropriate adjustments may also be
made by the Committee in the terms of any Benefits under
the Plan to reflect such changes or distributions and to
modify any other terms of outstanding Benefits on an
equitable basis, including modifications of performance
targets and changes in the length of performance periods.
In addition, other than with respect to Stock Options,
Stock Appreciation Rights, and other awards intended to
constitute Performance-Based Awards, the Committee is
authorized to make adjustments to the terms and conditions
of, and the criteria included in, Benefits in recognition
of unusual or nonrecurring events affecting the Company or
the financial statements of the Company, or in response to
changes in applicable laws, regulations, or accounting
principles. Notwithstanding the foregoing, (i) each such
adjustment with respect to an Incentive Stock Option shall
comply with the rules of Section 424(a) of the Code, and
(ii) in no event shall any adjustment be made which would
render any Incentive Stock Option granted hereunder other
than an incentive stock option for purposes of Section 422
of the Code.
(b) Notwithstanding any other provision of this Plan, if there
is a Change in Control of the Company, all then
outstanding Benefits that have not vested or become
exercisable at the time of such Change in Control shall
immediately vest and become exercisable and all
performance targets relating to such Benefits shall be
deemed to have been satisfied as of the time of such
Change in Control. For purposes of this Section 13(b), a
"Change in Control" of the Company shall be deemed to have
occurred upon any of the following events:
(i) A change in control of the direction and
administration of the Company's business of a
nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of
Regulation 14A promulgated under the Exchange
Act; or
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(ii) During any period of two (2) consecutive years,
the individuals who at the beginning of such
period constitute the Company's Board of
Directors or any individuals who would be
"Continuing Directors" (as hereinafter defined)
cease for any reason to constitute at least a
majority thereof; or
(iii) The Company's Common Stock shall cease to be
publicly traded; or
(iv) The Company's Board of Directors shall approve
a sale of all or substantially all of the
assets of the Company, and such transaction
shall have been consummated; or
(v) The Company's Board of Directors shall approve
any merger, consolidation, or like business
combination or reorganization of the Company,
the consummation of which would result in the
occurrence of any event described in Section
13(b)(ii) or (iii) above, and such transaction
shall have been consummated.
Notwithstanding the foregoing, (A) any spin-off of a
division or subsidiary of the Company to its stockholders
and (B) any event listed in (i) through (v) above that the
Board of Directors determines, in its sole discretion, not
to be a Change in Control of the Company for purposes of
the foregoing provision of this Plan as to vesting, shall
not constitute a Change in Control of the Company.
For purposes of this Section 13(b), "Continuing Directors"
shall mean (x) the directors of the Company in office on
the Effective Date (as defined below) and (y) any
successor to any such director and any additional director
who after the Effective Date was nominated or selected by
a majority of the Continuing Directors in office at the
time of his or her nomination or selection.
The Committee, in its sole discretion, may determine that,
upon the occurrence of a Change in Control of the Company
(without regard to any contrary determination by the Board
of Directors under paragraph (B) above), each Benefit
outstanding hereunder shall terminate within a specified
number of days after notice to the holder, and such holder
shall receive (i) with respect to each share of Common
Stock that is subject to a Stock Option or a Stock
Appreciation Right and is then vested, an amount equal to
the excess of the Fair Market Value of such shares of
Common Stock immediately prior to the occurrence of such
Change in Control over the exercise price per share of
such Stock Option or Stock Appreciation Right (as the case
may be) and (ii) with respect to each share of Common
Stock that is subject to a Stock Award or Stock Unit and
is then vested, the Fair Market Value of such shares of
Common Stock immediately prior to the occurrence of such
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Change in Control, such amount to be payable in cash, in
one or more kinds of property (including the property, if
any, payable in the transaction) or in a combination
thereof, as the Committee, in its sole discretion, shall
determine. The provisions contained in the preceding
sentence shall be inapplicable to a Stock Option or Stock
Appreciation Right granted within six (6) months before
the occurrence of a Change in Control if the holder of
such Stock Option or Stock Appreciation Right is subject
to the reporting requirements of Section 16 of the
Exchange Act and no exception from liability under Section
16 of the Exchange Act is otherwise available to such
holder.
14. NONTRANSFERABILITY. Each Benefit granted under the Plan to a
participant shall not be transferable otherwise than by will or the
laws of descent and distribution, and shall be exercisable, during
the participant's lifetime, only by the participant. In the event of
the death of a participant, each Stock Option or Stock Appreciation
Right theretofore granted to him or her shall be exercisable during
such period after his or her death as the Committee shall in its
discretion set forth in such Stock Option or Stock Appreciation Right
at the date of grant and then only by the executor or administrator
of the estate of the deceased participant or the person or persons to
whom the deceased participant's rights under the Stock Option or
Stock Appreciation Right shall pass by will or the laws of descent
and distribution. Notwithstanding the foregoing, at the discretion of
the Committee, an award of a Benefit other than an Incentive Stock
Option may permit the transferability of a Benefit by a participant
solely to the participant's spouse, siblings, parents, children and
grandchildren or trusts for the benefit of such persons or
partnerships, corporations, limited liability companies or other
entities owned solely by such persons, including trusts for such
persons, subject to any restriction included in the award of the
Benefit.
15. OTHER PROVISIONS. The award of any Benefit under the Plan may also be
subject to such other provisions (whether or not applicable to the
Benefit awarded to any other participant) as the Committee determines
appropriate, including, without limitation, for the installment
purchase of Common Stock under Stock Options, for the installment
exercise of Stock Appreciation Rights, to assist the participant in
financing the acquisition of Common Stock, for the forfeiture of, or
restrictions on resale or other disposition of, Common Stock acquired
under any form of Benefit, for the termination of any Benefit and the
forfeiture of any gain realized in respect of a Benefit upon the
occurrence of certain activity by the participant that is harmful to
the Company, for the acceleration of exercisability or vesting of
Benefits or the payment of the value of Benefits in the event that
the control of the Company changes (including, without limitation, a
Change in Control), or to comply with federal and state securities
laws, or understandings or conditions as to the participant's
employment (including, without limitation, any restrictions on the
ability of the participant to engage in activities that are
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competitive with the Company) in addition to those specifically
provided for under the Plan.
16. FAIR MARKET VALUE. For purposes of this Plan and any Benefits awarded
hereunder, Fair Market Value shall be the closing price of the
Company's Common Stock on the date of calculation (or on the last
preceding trading date if Common Stock was not traded on such date)
if the Company's Common Stock is readily tradable on a national
securities exchange or other market system, and if the Company's
Common Stock is not readily tradable, Fair Market Value shall mean
the amount determined in good faith by the Committee as the fair
market value of the Common Stock of the Company.
17. WITHHOLDING. All payments or distributions of Benefits made pursuant
to the Plan shall be net of any amounts required to be withheld
pursuant to applicable federal, state and local tax withholding
requirements. If the Company proposes or is required to distribute
Common Stock pursuant to the Plan, it may require the recipient to
remit to it or to the corporation that employs such recipient an
amount sufficient to satisfy such tax withholding requirements prior
to the delivery of any certificates for such Common Stock. In lieu
thereof, the Company or the employing corporation shall have the
right to withhold the amount of such taxes from any other sums due or
to become due from such corporation to the recipient as the Committee
shall prescribe. The Committee may, in its discretion and subject to
such rules as it may adopt (including any as may be required to
satisfy applicable tax and/or non-tax regulatory requirements),
permit an optionee or award or right holder to pay all or a portion
of the federal, state and local withholding taxes arising in
connection with any Benefit consisting of shares of Common Stock by
electing to have the Company withhold shares of Common Stock having a
Fair Market Value equal to the amount of tax to be withheld, such tax
calculated at rates required by statute or regulation.
18. TENURE. A participant's right, if any, to continue to serve the
Company or any of its subsidiaries or affiliates as an officer,
employee, consultant or otherwise, shall not be enlarged or otherwise
affected by his or her designation as a participant under the Plan.
19. UNFUNDED PLAN. Participants shall have no right, title, or interest
whatsoever in or to any investments which the Company may make to aid
it in meeting its obligations under the Plan. Nothing contained in
the Plan, and no action taken pursuant to its provisions, shall
create or be construed to create a trust of any kind, or a fiduciary
relationship between the Company and any participant, beneficiary,
legal representative or any other person. To the extent that any
person acquires a right to receive payments from the Company under
the Plan, such right shall be no greater than the right of an
unsecured general creditor of the Company. All payments to be made
hereunder shall be paid from the general funds of the Company and no
special or separate fund shall be established and no segregation of
assets shall be made to assure payment of such amounts except as
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expressly set forth in the Plan. The Plan is not intended to be
subject to the Employee Retirement Income Security Act of 1974, as
amended.
20. NO FRACTIONAL SHARES. No fractional shares of Common Stock shall be
issued or delivered pursuant to the Plan or any Benefit. The
Committee shall determine whether cash, or Benefits, or other
property shall be issued or paid in lieu of fractional shares or
whether such fractional shares or any rights thereto shall be
forfeited or otherwise eliminated.
21. DURATION, AMENDMENT AND TERMINATION. No Benefit shall be granted more
than ten years after the Effective Date. The Committee may amend the
Plan from time to time or suspend or terminate the Plan at any time.
No amendment of the Plan may be made without approval of the
stockholders of the Company if the amendment will: (i) disqualify any
Incentive Stock Options granted under the Plan; (ii) increase the
aggregate number of shares of Common Stock that may be delivered
through Stock Options under the Plan; (iii) increase the maximum
amounts which can be paid to an individual under the Plan; (iv)
change the types of business criteria on which Performance-Based
Awards are to be based under the Plan; or (v) modify the requirements
as to eligibility for participation in the Plan.
22. CANCELLATION AND NEW GRANT OF OPTIONS, ETC. The Board of Directors
shall have the authority to effect, at any time and from time to
time, with the consent of the affected optionees, (i) the
cancellation of any or all outstanding Stock Options under the Plan
and the grant in substitution therefor of new Stock Options under the
Plan covering the same or different numbers of shares of Common Stock
and having an option exercise price per share which may be lower or
higher than the exercise price per share of the cancelled Stock
Options or (ii) the amendment of the terms of any and all outstanding
Stock Options under the Plan to provide an option exercise price per
share which is higher or lower than the then current exercise price
per share of such outstanding Stock Options.
23. GOVERNING LAW. This Plan, Benefits granted hereunder and actions
taken in connection herewith shall be governed and construed in
accordance with the internal laws of the State of Delaware, without
giving effect to its choice-of-law provisions.
24. EFFECTIVE DATE AND TERMINATION DATE.
(a) The Plan shall be effective as of April 4, 2003, the date
on which the Plan was adopted by the Board of Directors
(the "Effective Date"), provided that the Plan is approved
by the stockholders of the Company at an annual meeting or
any special meeting of stockholders of the Company within
12 months of the Effective Date, and such approval of
stockholders shall be a condition to the right of each
participant to receive any Benefits hereunder. Any
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Benefits granted under the Plan prior to such approval of
stockholders shall be effective as of the date of grant
(unless, with respect to any Benefit, the Committee
specifies otherwise at the time of grant), but no such
Benefit may be exercised or settled and no restrictions
relating to any Benefit may lapse prior to such
stockholder approval, and if stockholders fail to approve
the Plan as specified hereunder, any such Benefit shall be
cancelled.
(b) This Plan shall terminate on April 3, 2013 (unless sooner
terminated by the Committee).
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