EXHIBIT 10.90
COMPUWARE CORPORATION
2002 DIRECTORS PHANTOM STOCK PLAN
1. DEFINITIONS. As used in this Plan, the following terms shall have the
following meanings:
(a) "Award" shall mean an award of Phantom Shares granted pursuant to
Section 6 of this Plan.
(b) "Board of Directors" shall mean the Board of Directors of the
Company.
(c) "Cause" shall mean termination for (1) the Participant's continued
failure to make a good faith effort to perform the Participant's duties,
(2) any willful act or omission by the Participant that the Participant
knew or had reason to know would injure the Company or any of its
subsidiaries, (3) the Participant's fraud, (4) the Participant's
dishonesty, or (5) the Participant's commission of a felony, or the
Participant's violation of any law relating to the Participant's service as
a member of the Board of Directors.
(d) "Committee" shall mean the Compensation Committee of the Board of
Directors or any other committee meeting the standards of Rule 16b-3 under
the Exchange Act, or any similar successor rule, appointed or designated by
the Board of Directors to perform any of the functions and duties of the
Committee under this Plan, or, if so designated by the Board of Directors,
the Board of Directors as a whole.
(e) "Company" shall mean Compuware Corporation, a Michigan
corporation, or any successor of Compuware Corporation.
(f) "Discretion" shall mean the sole discretion of the Committee, with
no requirement whatsoever that the Committee follow past practices, act in
a manner consistent with past practices, or treat any director in a manner
consistent with the treatment afforded other directors with respect to this
Plan or otherwise.
(g) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder.
(h) "Participant" shall mean any member of the Board of Directors who
is not an employee of the Company.
(i) "Phantom Share" shall mean the right to receive the Value of a
share of the Company's common stock in cash from the Company. Such right
shall be subject to the vesting and other terms and conditions of this Plan
and the agreement between the recipient of the Phantom Share and the
Company entered into at the time such Phantom Share was granted.
(j) "Plan" shall mean this Compuware Corporation 2002 Directors
Phantom Stock Plan, as amended from time to time as provided herein.
(k) "Value" as of any particular date shall mean the average of the
high and low sale prices per share of the Company's common stock on the
Nasdaq Stock Market ("NSM") for the most recent day prior to such date on
which the Company's common stock was traded on the NSM. If the Company's
common stock is not listed for trading on the NSM, (1) the
last reported sale price per share on the securities exchange (or, if there
is more than one, the principal such exchange) on which the Company's
common stock is then traded; (2) if the Company's common stock is not then
listed for trading on any securities exchange or the NSM but bid and ask
information is reported by Nasdaq or another generally accepted reporting
service, the average of the high bid and low asked prices per share of the
Company's common stock, as so reported by Nasdaq or, if not reported by
Nasdaq, another generally accepted reporting service; (3) if none of the
foregoing is applicable, the fair market value of a share of Company common
stock as of the relevant date, as determined by the Committee.
2. PURPOSES OF PLAN. The purposes of this Plan are (a) to provide
directors of the Company with an increased incentive to make significant
and extraordinary contributions to the long-term performance and growth of
the Company, (b) to join the interests of directors with the interests of
the shareholders of the Company, and (c) to facilitate attracting and
retaining directors of exceptional ability.
3. ADMINISTRATION. This Plan shall be administered by the Committee.
Subject to Section 6(a) and the other provisions of this Plan, the
Committee shall determine, from those eligible to be Participants under
this Plan, the persons to be granted Awards, the amount of the Award
granted to each such person, the time such Award shall be granted and the
terms and conditions of any Award. Subject to the provisions of this Plan,
the Committee is authorized to interpret this Plan, to promulgate, amend
and rescind rules and regulations relating to this Plan and to make all
other determinations necessary or advisable for its administration.
Interpretation and construction of any provision of this Plan by the
Committee shall, unless otherwise determined by the Board of Directors, be
final and conclusive. A majority of the Committee shall constitute a
quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, or acts approved in writing by a majority of the
Committee, shall be the acts of the Committee.
4. INDEMNIFICATION OF COMMITTEE MEMBERS. In addition to such other rights
of indemnification as they may have, the members of the Committee shall be
indemnified by the Company in connection with any claim, action, suit or
proceeding relating to any action taken or failure to act under or in
connection with this Plan or any Award granted hereunder to the full extent
provided for under the Company's articles of incorporation or bylaws with
respect to indemnification of directors of the Company; provided, however,
that within 60 days after receipt of notice of institution of any such
claim, action, suit or proceeding the Committee member shall offer the
Company in writing the opportunity, at its own cost, to handle and defend
such claim, action, suit or proceeding.
5. ADJUSTMENTS. The number of Phantom Shares subject to each outstanding\
Award shall be subject to such adjustment as the Committee, in its
Discretion, deems appropriate to reflect such events as stock dividends,
stock splits, recapitalizations, mergers, statutory share exchanges or
reorganizations of or by the Company. Notwithstanding any other provision
of this Plan, under no circumstances may any shares of the Company's common
stock be issued or issuable pursuant to this Plan.
6. AWARDS.
(a) Automatic Grants. On each April 1 during the term of the Plan,
beginning with April 1, 2002, each Participant serving on such date shall
automatically receive an Award of the number of Phantom Shares equal to the
Value of $10,000 evidenced by an agreement
substantially in the form attached to this Plan as Exhibit A. Awards to
Participants serving on the Board of Directors on April 1, 2002 shall be
made on the date of the adoption of this Plan by the Board of Directors.
Subject to Section 9, the Phantom Shares subject to each Award granted
pursuant to this Section 6(a) hereunder shall vest and become payable on
the date the holder of the Phantom Shares ceases to be a member of the
Board of Directors.
(b) Discretionary Grants. The Committee shall have the authority to
grant Awards to such Participants and for such number of Phantom Shares as
it shall designate. Such Awards may include such other provisions, such as
performance goals, as the Committee may determine.
(c) General. Each Award granted pursuant to paragraphs (a) or (b) of
this Plan shall be evidenced by an agreement between the Participant
receiving the Award and the Company that shall specify the terms thereof,
including the vesting terms, the number of Phantom Shares subject to the
Award, and such other provisions as are determined by the Committee and
which are not inconsistent with the terms of this Plan. Such provisions
may, in the Committee's Discretion, include, without limitation, a
provision terminating the Award if the Participant competes with the
Company or otherwise acts contrary to the Company's interests. The
Committee may condition any grant on the potential Participant's agreement
to such terms and conditions. Any Participant may hold more than one Award.
7. PAYMENT. Upon the vesting of any Phantom Shares, the Company shall pay
the Value of such vested Phantom Shares in cash to the Participant. The
amount of such payment shall be equal to the number of Phantom Shares then
vested (and not previously paid) multiplied by the Value. No Participant
shall have any of the rights of a shareholder of the Company with respect
to any Award or Phantom Shares, including without limitation any voting
rights or rights to receive dividends.
8. TRANSFERABILITY OF AWARD. No Phantom Shares or Award granted under this
Plan shall be transferable other than (a) by will, (b) by the laws of
descent and distribution, or (c) pursuant to a qualified domestic relations
order as defined in the Code or Title I of the Employee Retirement Income
Security Act, or the rules thereunder. Payments with respect to Phantom
Shares and any Award under this Plan shall be payable, during the lifetime
of the Participant, only to the Participant.
9. TERMINATION. Notwithstanding the terms of Section 6, if a Participant
is removed from the Board of Directors for Cause in accordance with
applicable law, all unvested Phantom Shares held by such Participant shall
terminate and be forfeited to the Company on the date that such Participant
ceases to be a member of the Board of Directors.
10. NO FURTHER RIGHT TO CONTINUE AS A DIRECTOR. Nothing contained in this
Plan or in any Award granted pursuant to this Plan, nor any action taken by
the Committee under this Plan, shall confer upon any Participant any right
to continue in office as a director of the Company.
11. WITHHOLDING PAYMENTS. The Company shall have the right to withhold from
a Participant's payment or require a Participant to remit sufficient funds
to satisfy applicable withholding tax obligations upon the making of any
payment following the vesting of Phantom Shares, upon such terms and
conditions as the Committee or the related Award agreement shall prescribe.
The Committee may make such other arrangements with respect to income tax
withholding as it shall deem appropriate.
12. EFFECTIVENESS OF PLAN. This Plan shall be effective on the date the
Board of Directors adopts this Plan.
13. TERMINATION, DURATION AND AMENDMENTS TO THIS PLAN. This Plan shall
continue in effect until abandoned or terminated by the Board of Directors
by resolution approved in accordance with the bylaws of the Company. The
termination of this Plan shall not affect the validity of any Award which
is outstanding on the date of termination. For the purpose of conforming to
any changes in applicable law or governmental regulations, or for any other
lawful purpose, the Board of Directors shall have the right, without
approval of the shareholders of the Company or any Participant, to amend or
revise the terms of this Plan or any Award agreement under this Plan at any
time; provided, however, that any such amendment shall be in writing; and
provided, further, that no such amendment or revision, other than an
amendment or other revision made to correct an administrative error, shall
materially alter or impair any Award which shall have been previously
granted under this Plan in a manner adverse to the Participant holding such
Award without the consent of such Participant.
As adopted by the Board of Directors on January 23, 2003.
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