ROSS STORES, INC.
FISCAL 1999 FORM 10-K
EXHIBIT 10.9
FOURTH AMENDED AND RESTATED
ROSS STORES, INC.
1988 RESTRICTED STOCK PLAN
(EFFECTIVE AS OF MARCH 16, 2000)
1. ESTABLISHMENT, PURPOSE AND TERM OF PLAN.
1.1 ESTABLISHMENT. The Third Amended and Restated Ross Stores,
Inc. 1988 Restricted Stock Plan is hereby amended and restated in its
entirety as the Fourth Amended and Restated Ross Stores, Inc. 1988 Restricted
Stock Plan (the "PLAN") effective as of March 16, 2000 (the "EFFECTIVE DATE").
1.2 PURPOSE. The purpose of the Plan is to advance the
interests of the Participating Company Group and its stockholders by
providing an incentive to attract, retain and reward selected employees of
the Participating Company Group and by motivating such persons to contribute
to the success of the Participating Company Group.
1.3 TERM OF PLAN. The Plan shall continue in effect until the
earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued and
all restrictions on such shares under the terms of the Plan and the
agreements pursuant to which such shares were granted have lapsed.
2. DEFINITIONS AND CONSTRUCTION.
2.1 DEFINITIONS. Whenever used herein, the following terms
shall have their respective meanings set forth below:
(a) "AWARD" means any award of Stock under the Plan.
(b) "AWARD AGREEMENT" means a written agreement between the
Company and a Participant setting forth the terms, conditions and
restrictions of an Award granted to the Participant.
(c) "BOARD" means the Board of Directors of the Company. If
one or more Committees have been appointed by the Board to administer the
Plan, "BOARD" also means such Committee(s).
(d) "CHANGE IN CONTROL" means the occurrence of any of the
following:
(i) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act), other than (1) a trustee or other
fiduciary holding stock of the Company under an employee benefit plan of a
Participating Company or (2) a corporation owned directly or indirectly by
the stockholders of the Company in substantially the same proportions as
their ownership of the stock of the Company, becomes the "beneficial owner"
(as defined in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of stock of the Company representing more than fifty percent
(50%) of the total combined voting power of the Company's then-outstanding
voting stock; or
(ii) an Ownership Change Event or a series of related
Ownership Change Events (collectively, a "TRANSACTION") wherein the
stockholders of the Company immediately before the Transaction do not retain
immediately after the Transaction direct or indirect beneficial ownership of
more than fifty percent (50%) of the total combined voting power of the
outstanding voting stock of the Company or, in the event of a sale of assets,
of the corporation or corporations to which the assets of the Company were
transferred (the "TRANSFEREE CORPORATION(S)"); or
(iii) a liquidation or dissolution of the Company.
For purposes of the preceding sentence, indirect beneficial ownership shall
include, without limitation, an interest resulting from ownership of the
voting stock of one or more corporations which, as a result of the
Transaction, own the Company or the Transferee Corporation(s), as the case
may be, either directly or through one or more subsidiary corporations. The
Board shall have the right to determine whether multiple Ownership Change
Events are related, and its determination shall be final, binding and
conclusive.
(e) "CODE" means the Internal Revenue Code of 1986, as
amended, and any applicable regulations promulgated thereunder.
(f) "COMMITTEE" means the Compensation Committee or other
committee of one or more members of the Board duly appointed to administer
the Plan and having such powers as shall be specified by the Board. Unless
the powers of the Committee have been specifically limited, the Committee
shall have all of the powers of the Board granted herein, including, without
limitation, the power to amend or terminate the Plan at any time, subject to
the terms of the Plan and any applicable limitations imposed by law.
(g) "COMPANY" means Ross Stores, Inc., a Delaware
corporation, or any successor corporation thereto.
(h) "EMPLOYEE" means any person treated as an employee
(including an officer or a member of the Board who is also treated as an
employee) in the records of a Participating Company; provided, however, that
neither service as a member of the Board nor payment of a director's fee
shall be sufficient to constitute employment for purposes of the Plan.
(i) "EXCHANGE ACT" means the Securities Exchange Act of 1934,
as amended.
(j) "INSIDER" means an officer of the Company, member of
the Board or any other person whose transactions in Stock are subject to
Section 16 of the Exchange Act.
(k) "NON-EMPLOYEE DIRECTOR" means a Director who (i) is not
a current employee or officer of a Participating Company; (ii) does not
receive compensation, either directly or indirectly, from a Participating
Company for services rendered as a consultant or in any capacity other than
as a Director, except for an amount that does not exceed the dollar amount
for which disclosure would be required pursuant to Item 404(a) of Regulation
S-K under the Securities Act ("REGULATION S-K"); (iii) does not possess an
interest in any other transaction for which disclosure would be required
pursuant to Item 404(a) of Regulation S-K; and (iv) is not engaged in a
business relationship for which disclosure would be required pursuant to Item
404(b) of Regulation S-K.
(l) "OWNERSHIP CHANGE EVENT" means the occurrence of any of
the following with respect to the Company: (i) the direct or indirect sale or
exchange in a single or series of related transactions by the stockholders of
the Company of more than fifty percent (50%) of the voting stock of the
Company; (ii) a merger or consolidation in which the Company is a party; or
(iii) the sale, exchange, or transfer of all or substantially all of the
assets of the Company.
(m) "PARENT CORPORATION" means any present or future
"parent corporation" of the Company, as defined in Section 424(e) of the Code.
(n) "PARTICIPANT" means a person who has been granted one
or more Awards.
(o) "PARTICIPATING COMPANY" means the Company or any Parent
Corporation or Subsidiary Corporation.
(p) "PARTICIPATING COMPANY GROUP" means, at any point in
time, all corporations collectively which are then Participating Companies.
(q) "RULE 16B-3" means Rule 16b-3 under the Exchange Act,
as amended from time to time, or any successor rule or regulation.
(r) "SERVICE" means a Participant's employment or service
with the Participating Company Group, whether in the capacity of an Employee,
a member of the Board or a consultant or advisor, unless otherwise provided
in the Participant's Award Agreement. Unless otherwise provided in a
Participant's Award Agreement, the Participant's Service shall not be deemed
to have terminated merely because of a change in the capacity in which the
Participant renders Service to the Participating Company Group or a change in
the Participating Company for which the Participant renders such Service,
provided that there is no interruption or termination
of the Participant's Service. Furthermore, a Participant's Service with the
Participating Company Group shall not be deemed to have terminated if the
Participant takes any bona fide leave of absence approved by the Company;
provided, however, that unless otherwise designated by the Board or required
by law, a leave of absence shall not be treated as Service for purposes of
determining the Vesting under the Participant's Award Agreement. The
Participant's Service shall be deemed to have terminated either upon an
actual termination of Service or upon the corporation for which the
Participant performs Service ceasing to be a Participating Company. Subject
to the foregoing, the Company, in its discretion, shall determine whether the
Participant's Service has terminated and the effective date of such
termination.
(s) "STOCK" means the common stock of the Company, as
adjusted from time to time in accordance with Section 4.2.
(t) "SUBSIDIARY CORPORATION" means any present or future
"subsidiary corporation" of the Company, as defined in Section 424(f) of the
Code.
(u) "VEST, " "VESTED" and "VESTING" refer to the right of a
Participant, earned through continued Service and/or satisfaction of other
conditions specified by the Plan or the Board to hold the securities acquired
pursuant to an Award free of any substantial risk of forfeiture.
2.2 CONSTRUCTION. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of any
provision of the Plan. Except when otherwise indicated by the context, the
singular shall include the plural and the plural shall include the singular.
Use of the term "or" is not intended to be exclusive, unless the context
clearly requires otherwise.
3. ADMINISTRATION.
3.1 ADMINISTRATION BY THE BOARD. The Plan shall be administered
by the Board. All questions of interpretation of the Plan or of any Award
shall be determined by the Board, and such determinations shall be final and
binding upon all persons having an interest in the Plan or such Award.
3.2 AUTHORITY OF OFFICERS. Any officer of a Participating
Company shall have the authority to act on behalf of the Company with respect
to any matter, right, obligation, determination or election which is the
responsibility of or which is allocated to the Company herein, provided the
officer has apparent authority with respect to such matter, right,
obligation, determination or election.
3.3 POWERS OF THE BOARD. In addition to any other powers set
forth in the Plan and subject to the provisions of the Plan, the Board shall
have the full and final power and authority, in its discretion:
(a) to determine the persons to whom, and the time or times
at which, Awards shall be granted and the number of shares of Stock to be
subject to each Award;
(b) to determine the terms, conditions and restrictions
applicable to each Award (which need not be identical);
(c) to approve one or more forms of Award Agreement;
(d) to amend or modify any Award Agreement or to waive any
restrictions or conditions applicable to any Award;
(e) to accelerate, continue, extend or defer the Vesting of
any shares acquired under the Plan, including with respect to the period
following a Participant's termination of Service;
(f) to prescribe, amend or rescind rules, guidelines and
policies relating to the Plan, or to adopt supplements to, or alternative
versions of, the Plan, including, without limitation, as the Board deems
necessary or desirable to comply with the laws of, or to accommodate the tax
policy or custom of, foreign jurisdictions whose citizens may be granted
Awards; and
(g) to correct any defect, supply any omission or reconcile
any inconsistency in the Plan or any Award Agreement and to make all other
determinations and take such other actions with respect to the Plan or any
Award as the Board may deem advisable to the extent not inconsistent with the
provisions of the Plan or applicable law.
3.4 ADMINISTRATION WITH RESPECT TO INSIDERS. With respect to
participation by Insiders in the Plan, at any time that any class of equity
security of the Company is registered pursuant to Section 12 of the Exchange
Act, the Plan shall be administered in compliance with the requirements, if
any, of Rule 16b-3. For this purpose, the Board may delegate authority to
administer the Plan to a Committee composed solely of two or more
Non-Employee Directors.
3.5 INDEMNIFICATION. In addition to such other rights of
indemnification as they may have as members of the Board or officers or
employees of the Participating Company Group, members of the Board and any
officers or employees of the Participating Company Group to whom authority to
act for the Board or the Company is delegated shall be indemnified by the
Company against all reasonable expenses, including attorneys' fees, actually
and necessarily incurred in connection with the defense of any action, suit
or proceeding, or in connection with any appeal therein, to which they or any
of them may be a party by reason of any action taken or failure to act under
or in connection with the Plan, or any right granted hereunder, and against
all amounts paid by them in settlement thereof (provided such settlement is
approved by independent legal counsel selected by the Company) or paid by
them in satisfaction of a judgment in any such action, suit or proceeding,
except in relation to matters as to which it shall be adjudged in such
action, suit or proceeding that such person is liable for gross negligence,
bad faith or intentional misconduct in duties; provided, however, that within
sixty (60) days after the institution of such action, suit or proceeding,
such person shall offer to the Company, in writing, the opportunity at its
own expense to handle and defend the same.
4. SHARES SUBJECT TO PLAN.
4.1 MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to adjustment as
provided in Section 4.2, the maximum aggregate number of shares of Stock that
may be issued under the Plan shall be fourteen million six hundred thousand
(14,600,000)(1) and shall consist of authorized but unissued or reacquired
shares of Stock or any combination thereof. If shares of Stock issued
pursuant to the Plan are reacquired by the Company under the terms of the
Plan, such shares of Stock shall again be available for issuance under the
Plan.
4.2 ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the event
of any stock dividend, stock split, reverse stock split, recapitalization,
merger, combination, exchange of shares, reclassification or similar change
in the capital structure of the Company, appropriate adjustments shall be
made in the number and class of shares subject to the Plan and to any
outstanding Award. If a majority of the shares which are of the same class as
the shares that are subject to outstanding Awards are exchanged for,
converted into, or otherwise become (whether or not pursuant to an Ownership
Change Event) shares of another corporation (the "NEW SHARES"), the Board may
unilaterally amend the outstanding Awards to provide that such Awards shall
be for New Shares. In the event of any such amendment, the number of shares
subject to the outstanding Awards shall be adjusted in a fair and equitable
manner as determined by the Board, in its discretion. Notwithstanding the
foregoing, any fractional share resulting from an adjustment pursuant to this
Section 4.2 shall be rounded down to the nearest whole number. The
adjustments determined by the Board pursuant to this Section 4.2 shall be
final, binding and conclusive.
5. ELIGIBILITY.
Awards may be granted only to Employees. Awards are granted
solely at the discretion of the Board. Eligibility in accordance with this
Section shall not entitle any person to be granted an Award, or, having been
granted an Award, to be granted an additional Award.
6. TERMS AND CONDITIONS OF AWARDS.
Awards shall be evidenced by Award Agreements specifying the
number of shares of Stock subject to and the other terms, conditions and
restrictions of the Award, and shall be in such form as the Board shall from
time to time establish. No Award or purported Award shall be a valid and
binding obligation of the Company unless evidenced by a fully executed Award
Agreement. Award Agreements may incorporate all or any of the terms of the
Plan by reference and shall comply with and be subject to the following terms
and conditions:
6.1 PAYMENT FOR SHARES. No monetary payment (other than
applicable tax withholding) shall be required as a condition of receiving
shares of Stock pursuant to an Award, the consideration for which shall be
past services actually rendered or future services to be rendered to a
Participating Company or for its benefit, as determined by the Board in its
discretion; provided, however, that to the extent that newly issued shares of
Stock are awarded to
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(1) As adjusted through the two-for-one stock split effective on September 12,
1999.
a Participant, the Participant shall have provided past services to a
Participating Company or for its benefit having a value not less than the par
value of such shares.
6.2 VESTING AND RESTRICTIONS ON TRANSFER. Shares of Stock
issued pursuant to any Award shall Vest upon the satisfaction of such Service
requirements, conditions, restrictions or performance criteria, if any, as
shall be established by the Board and set forth in the Award Agreement
evidencing such Award. During any period (the "RESTRICTION PERIOD") in which
shares acquired pursuant to an Award have not Vested, such shares may not be
sold, exchanged, transferred, pledged, assigned or otherwise disposed of
other than pursuant to an Ownership Change Event or as provided in Section
6.5. Upon request by the Company, each Participant shall execute any
agreement evidencing such transfer restrictions prior to the receipt of
shares of Stock hereunder and shall promptly present to the Company any and
all certificates representing shares of Stock acquired hereunder for the
placement on such certificates of appropriate legends evidencing any such
transfer restrictions.
6.3 VOTING RIGHTS; DIVIDENDS. Except as provided in this
Section and Section 6.2, during the Restriction Period applicable to shares
acquired by a Participant pursuant to an Award, the Participant shall have
all of the rights of a stockholder of the Company holding shares of Stock,
including the right to vote such shares and to receive all dividends and
other distributions paid with respect to such shares; provided, however, that
if any such dividends or distributions are paid in shares of Stock, such
shares shall be subject to the same Vesting conditions as the shares subject
to the Award with respect to which the dividends or distributions were paid.
6.4 EFFECT OF TERMINATION OF SERVICE. Unless otherwise provided
in the grant of an Award to a Participant and set forth in the Award
Agreement evidencing such Award or unless otherwise provided in an employment
agreement between a Participating Company and the Participant, if a
Participant's Service with the Participating Company Group terminates for any
reason, whether voluntary or involuntary (including as a result of the
Participant's death or disability), then the Participant shall forfeit to the
Company and the Company shall automatically reacquire without any payment
therefor to the Participant any and all shares acquired by the Participant
pursuant to the Award which have not Vested as of the date of the
Participant's termination of Service.
6.5 NONTRANSFERABILITY OF AWARD RIGHTS. Rights to acquire
shares of Stock pursuant to an Award may not be assigned or transferred in
any manner except by will or the laws of descent and distribution, and,
during the lifetime of the Participant, shall be exercisable only by the
Participant.
6.6 TAX WITHHOLDING.
(a) IN GENERAL. The Company shall have the right to require
the Participant, through payroll withholding, cash payment or otherwise, to
make adequate provision for the federal, state, local and foreign taxes, if
any, required by law to be withheld by the Participating Company Group with
respect to an Award or the shares acquired pursuant thereto. The Company
shall have no obligation to deliver shares of Stock or to release shares of
Stock
from an escrow established pursuant to an Award Agreement until the
Participating Company Group's tax withholding obligations have been satisfied
by the Participant.
(b) WITHHOLDING IN SHARES. The Board may permit a
Participant to satisfy all or any portion of the Participating Company
Group's tax withholding obligations by requesting the Company to withhold a
number of whole, Vested shares of Stock otherwise deliverable to the
Participant pursuant to the Award or by tendering to the Company a number of
whole, Vested shares of Stock acquired pursuant to the Award or otherwise
having in any such case a fair market value, as determined by the Company as
of the date on which the tax withholding obligations arise, not in excess of
the amount of such tax withholding obligations determined by the applicable
minimum statutory withholding rates. Any adverse consequences to the
Participant resulting from the procedure permitted under this Section,
including, without limitation, tax consequences, shall be the sole
responsibility of the Participant.
7. STANDARD FORM OF AWARD AGREEMENT.
7.1 RESTRICTED STOCK AGREEMENT. Unless otherwise provided by
the Board at the time an Award is granted, each Award shall comply with and
be subject to the terms and conditions set forth in the form of Restricted
Stock Agreement approved by the Board concurrently with its adoption of the
Plan and as amended from time to time.
7.2 AUTHORITY TO VARY TERMS. The Board shall have the authority
from time to time to vary the terms of any standard form of Restricted Stock
Agreement described in this Section 7 either in connection with the grant or
amendment of an individual Award or in connection with the authorization of a
new standard form or forms; provided, however, that the terms and conditions
of any such new, revised or amended standard form or forms of Restricted
Stock Agreement are not inconsistent with the terms of the Plan.
8. EFFECT OF CHANGE IN CONTROL.
In the event of a Change in Control, the Vesting of shares
subject to each then outstanding Award held by a Participant whose Service
has not terminated prior to the date of the Change in Control shall be
accelerated in full effective as of the date of the Change in Control.
9. COMPLIANCE WITH SECURITIES LAW.
The issuance of shares of Stock pursuant to an Award shall be
subject to compliance with all applicable requirements of federal, state and
foreign law with respect to such securities. Shares of Stock may not be
issued if such issuance would constitute a violation of any applicable
federal, state or foreign securities laws or other law or regulations or the
requirements of any stock exchange or market system upon which the Stock may
then be listed. The inability of the Company to obtain from any regulatory
body having jurisdiction the authority, if any, deemed by the Company's legal
counsel to be necessary to the lawful issuance of any shares hereunder shall
relieve the Company of any liability in respect of the failure to issue such
shares as to which such requisite authority shall not have been obtained. As
a condition to the grant of any Award, the Company may require the
Participant to satisfy any qualifications that may be
necessary or appropriate, to evidence compliance with any applicable law or
regulation and to make any representation or warranty with respect thereto as
may be requested by the Company.
10. TERMINATION OR AMENDMENT OF PLAN.
The Board may terminate or amend the Plan at any time;
provided, however, that without the approval of the Company's stockholders,
there shall be no amendment of the Plan that would require approval of the
Company's stockholders under any applicable law, regulation or rule. No
termination or amendment of the Plan shall affect any then outstanding Award
unless expressly provided by the Board. In any event, no termination or
amendment of the Plan may adversely affect any then outstanding Award without
the consent of the Participant.
11. MISCELLANEOUS PROVISIONS.
11.1 PROVISION OF INFORMATION. Each Participant shall be given
access to information concerning the Company equivalent to that information
generally made available to the Company's common stockholders so long as the
Participant remains a stockholder.
11.2 RIGHTS AS A STOCKHOLDER. A Participant shall have no
rights as a stockholder with respect to any shares covered by an Award until
the date of the issuance of a certificate for such shares (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company). No adjustment shall be made for dividends,
distributions or other rights for which the record date is prior to the date
such certificate is issued, except as provided in Section 4.2 or another
provision of the Plan.
11.3 RIGHTS AS EMPLOYEE, CONSULTANT OR BOARD MEMBER. No person,
even though eligible pursuant to Section 5, shall have a right to be selected
as a Participant, or, having been so selected, to be selected again as a
Participant. Nothing in the Plan or any Award granted under the Plan shall
confer on any Participant a right to remain an Employee, a member of the
Board or a consultant or advisor, or interfere with or limit in any way the
right of a Participating Company to terminate the Participant's Service at
any time.
11.4 CONTINUATION OF PRIOR VERSIONS OF THE PLAN AS TO
OUTSTANDING AWARDS. Notwithstanding any other provision of the Plan to the
contrary, each Award outstanding prior to the Effective Date shall continue
to be governed by the terms of the applicable version of the Plan as in
effect on the date of grant of such Award. For purposes of the preceding
sentence, such prior versions of the Plan include the Ross Stores, Inc. 1988
Restricted Stock Plan adopted on March 14, 1988; the Amended and Restated
Ross Stores, Inc. 1988 Restricted Stock Plan adopted on March 17, 1989; the
Second Amended and Restated Ross Stores, Inc. 1988 Restricted Stock Plan
adopted on March 18, 1991; and the Third Amended and Restated Ross Stores,
Inc. 1988 Restricted Stock Plan adopted on March 16, 1992.
IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing sets forth the Fourth Amended and Restated Ross Stores, Inc.
1988 Restricted Stock Plan as duly adopted by the Board on March 16, 2000.
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Secretary