EXHIBIT 4.1
INDYMAC BANCORP, INC.
2002 INCENTIVE PLAN
AS AMENDED AND RESTATED AS OF APRIL 28, 2004
SECTION 1
GENERAL
1.1. Purpose. The IndyMac Bancorp, Inc. 2002 Incentive Plan (the "Plan")
has been established by IndyMac Bancorp, Inc. (the "Company") to (i) attract and
retain persons eligible to participate in the Plan; (ii) motivate Participants,
by means of appropriate incentives, to achieve long-range goals; (iii) provide
incentive compensation opportunities that are competitive with those of other
similar companies; and (iv) further identify Participants' interests with those
of the Company's other stockholders through compensation that is based on the
Company's common stock; and thereby promote the long-term financial interest of
the Company and the Subsidiaries, including the growth in value of the Company's
equity and enhancement of long-term stockholder return. The following provisions
constitute an amendment, restatement, and continuation of the Plan as in effect
immediately prior to April 28, 2004.
1.2. Participation. Subject to the terms and conditions of the Plan, the
Committee shall determine and designate, from time to time, from among the
Eligible Individuals (including transferees of Eligible Individuals to the
extent the transfer is permitted by the Plan and the applicable Award
Memorandum), those persons who will be granted one or more Awards under the
Plan, and thereby become "Participants" in the Plan.
1.3. Operation, Administration, and Definitions. The operation and
administration of the Plan, including the Awards made under the Plan, shall be
subject to the provisions of Section 5 (relating to operation and
administration). Capitalized terms in the Plan shall be defined as set forth in
the Plan (including the definition provisions of Section 9).
SECTION 2
OPTIONS AND SARS
2.1. Definitions.
(a) The grant of an "Option" entitles the Participant to purchase shares of
Stock at an Exercise Price established by the Committee. Any Option
granted under this Section 2 may be either an incentive stock option (an
"ISO") or a non-qualified option (an "NQO"), as determined in the
discretion of the Committee. An "ISO" is an Option that is intended to
satisfy the requirements applicable to an "incentive stock option"
described in section 422(b) of the Code. An "NQO" is an Option that is not
intended to be or does not qualify as an "incentive stock option" as that
term is described in section 422(b) of the Code.
(b) A stock appreciation right (an "SAR") entitles the Participant to receive,
in cash or Stock (as determined in accordance with subsection 2.5), value
equal to (or otherwise based on) the excess of: (a) the Fair Market Value
of a specified number of shares of Stock at the time of exercise; over (b)
an Exercise Price established by the Committee.
2.2. Exercise Price. The "Exercise Price" of each Option and SAR granted
under this Section 2 shall be established by the Committee or shall be
determined by a method established by the Committee at the time the Option or
SAR is granted; except that the Exercise Price shall not be less than 100% of
the Fair Market Value of a share of Stock on the date of grant (or, if greater,
the par value of a share of Stock).
2.3. Exercise. An Option and an SAR shall be exercisable in accordance
with such terms and conditions and during such periods as may be established by
the Committee; provided, however, that Awards granted pursuant to Section 2
(relating to Options and SARs) shall have a minimum 1-year vesting period. No
fewer than 100 shares of Stock may be purchased on exercise of any Option at one
time unless the number purchased is the total number at the time available for
purchase under the Option.
2.4. Vesting. Subject to the limitations of the Plan, each installment of
shares covered by an Option or SAR granted pursuant to Section 2 shall be
exercisable on and after the vesting date for such installment as established by
the Committee and/or its delegates and specified in the applicable Award
Memorandum relating to the Award. Unless otherwise provided herein or in the
applicable Award Memorandum: (i) an Option granted pursuant to this Section 2
shall become fully vested and exercisable upon the optionee's Date of
Termination, if the Date of Termination occurs by reason of the optionee's
death, Disability, or Retirement, and (ii) the Option may be exercised on or
after the optionee's Date of Termination only as to that portion of the Covered
Shares for which it was exercisable as of the optionee's Date of Termination.
2.5. Payment of Option Exercise Price. The payment of the Exercise Price
of an Option granted under this Section 2 shall be subject to the following:
(a) Subject to the following provisions of this subsection 2.5, the full
Exercise Price for shares of Stock purchased upon the exercise of any
Option shall be paid at the time of such exercise (except that, in the
case of an exercise arrangement approved by the Committee and described in
subsection 2.5(c), payment may be made as soon as practicable after the
exercise). To the extent that an Option Award is exercisable, it may be
exercised in whole or in part by filing a written notice with the Stock
Award Administrator of the Company at its corporate headquarters prior to
the date the Option expires. Such notice shall specify the number of
shares of Stock which the Participant elects to purchase, and, subject to
subsection 2.5(c), shall be accompanied by payment of the Exercise Price
for such shares of Stock indicated by the Participant's election.
(b) The Exercise Price shall be payable in cash, by promissory note (other
than from a director of executive officer of the Company), or by
tendering, by either actual delivery of shares or by attestation, shares
of Stock acceptable to the Committee and valued at Fair Market Value as of
the day of exercise (provided that any such shares used in payment shall
have been owned by the Participant for at least such period of time, if
any, as is necessary to avoid variable accounting for the Option), or in
any combination thereof, as determined by the Committee.
(c) Unless otherwise provided in the applicable Award Memorandum or otherwise
specified by the Committee prior to exercise, a Participant may to elect
to pay the Exercise Price
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upon the exercise of an Option by irrevocably authorizing a third party to
sell shares of Stock (or a sufficient portion of the shares) acquired upon
exercise of the Option and remit to the Company a sufficient portion of
the sale proceeds to pay the entire Exercise Price and any tax withholding
resulting from such exercise.
(d) The Committee may provide in an Award Memorandum for any other method of
payment of the Exercise Price upon the exercise of an Option or SAR.
2.6. Expiration. Unless otherwise provided in the applicable Award
Memorandum, an Option shall expire on the tenth anniversary of the Grant Date,
and the Option shall not be exercisable after:
(a) except as provided in subsections (b) and (c) below, if the termination
occurs for reasons other than death, Disability, Retirement, or Cause, the
three-month anniversary of the Participant's Date of Termination;
(b) if the termination occurs by reason of the Participant's death, or if the
Participant's death occurs within three months after the Date of
Termination in accordance with subsection (a) above, the one-year
anniversary of the Participant's Date of Termination;
(c) if the termination occurs by reason of the Participant's Disability, or if
the holder incurs a Disability within three months after the Date of
Termination in accordance with subsection (a) above, the one-year
anniversary of the Participant's Date of Termination;
(d) if the termination occurs by reason of the Participant's Retirement, the
one-year anniversary of the Participant's Date of Termination; or
(e) if the termination occurs by reason of Cause, the Participant's Date of
Termination.
To the extent that any Option granted pursuant to this Section 2 is not
exercised prior to (i) a dissolution of the Company or (ii) a merger or other
corporate event that the Company does not survive, and no provision is made for
the assumption, conversion, substitution or exchange of the Option, the Option
shall terminate upon the occurrence of such event.
2.7. Non-Employee Director Options. Grants of Options to Non-Employee
Directors under the Plan shall be made only in accordance with the terms,
conditions and parameters for the compensation of Non-Employee Directors as
established from time to time by the Board and set forth in writing in the Board
Compensation Policy. The Committee may not make other discretionary grants under
the Plan to Non-Employee Directors.
2.8. Employment Agreement. Notwithstanding any other provision of this
Section 2 to the contrary (other than the first sentence of subsection 2.3,
which requires a minimum 1-year vesting period), if a Participant is subject to
an Employment Agreement containing provisions which, by their terms, govern the
vesting, exercisability, or other aspects of any Options or SARs granted under
the Plan, such terms shall supersede the provisions of this Section 2 with
respect to such Participant's Options, and if a Participant is subject to an
Employment Agreement containing definitions of cause, disability, or retirement,
such definitions shall supersede the respective definitions of this Plan with
respect to such Participant's Options.
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2.9. Repricing. Except for either adjustments pursuant to subsection
5.2(f) (relating to the adjustment of shares) or decreases approved by the
Company's stockholders, the Exercise Price for any outstanding Option granted
under the Plan may not be decreased after the date of grant nor may an
outstanding Option be surrendered to the Company as consideration for the grant
of a new Option with a lower exercise price.
SECTION 3
OTHER STOCK AWARDS
3.1. Definitions.
(a) A "Bonus Stock" Award is a grant of shares of Stock in return for
previously performed services, or in return for the Participant
surrendering other compensation that may be due.
(b) A "Stock Unit" Award is the grant of a right to receive shares of Stock in
the future.
(c) A "Performance Share" Award is a grant of a right to receive shares of
Stock or Stock Units that is contingent on the achievement of performance
or other objectives during a specified period.
(d) A "Performance Unit" Award is a grant of a right to receive a designated
dollar value amount of Stock that is contingent on the achievement of
performance or other objectives during a specified period.
(e) A "Restricted Stock" Award is a grant of shares of Stock, and a
"Restricted Stock Unit" Award is the grant of a right to receive shares of
Stock in the future, with such shares of Stock or right to future delivery
of such shares of Stock subject to a risk of forfeiture or other
restrictions that will lapse upon the achievement of one or more goals
relating to completion of service by the Participant, or achievement of
performance or other objectives, as determined by the Committee.
3.2. Restrictions on Awards. Each Bonus Stock Award, Stock Unit Award,
Restricted Stock Award, Restricted Stock Unit Award, Performance Share Award,
and Performance Unit Award shall be subject to the following, to the extent
applicable:
(a) Any such Award shall be subject to such conditions, restrictions and
contingencies as the Committee shall determine.
(b) Awards of Restricted Stock or Restricted Stock Units and any Covered
Shares may not be sold, transferred, assigned, pledged, hypothecated or
otherwise disposed of in any way (whether by operation of law or
otherwise) during the Restricted Period other than by will or by the
applicable laws of descent and distribution.
(c) Unless otherwise provided in the applicable Award Memorandum or an
Employment Agreement with the Participant, or otherwise provided by the
Committee, the following terms shall apply to an Awards of Restricted
Stock or Restricted Stock Units granted under this Section 3:
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(i) Vesting. The Covered Shares shall be transferred to the Participant
free of all restrictions upon the date they become fully vested. A
Participant who ceases to be an Employee shall forfeit the portion of his
or her Restricted Stock or Restricted Stock Unit Award that is not vested
immediately prior to his or her Date of Termination.
(ii) Dividends. Dividends, if any, accrued on the Covered Shares during
the Restricted Period shall be credited to the Participant and held by the
Company on behalf of the Participant. The Participant's interest in the
dividends shall vest on the same date that his or her interest in the
Covered Shares vest. In the event that any portion of the Covered Shares
are forfeited, the accrued and unpaid dividends relating to the Covered
Shares also shall be forfeited.
(iii) Voting. The Participant shall not be prevented from voting the
Covered Shares merely because those shares are subject to the restrictions
imposed by this Plan; provided, however, that the Participant shall not be
entitled to vote Covered Shares with respect to record dates for any
Covered Shares occurring on or after the date, if any, on which the
Participant has forfeited those shares.
(iv) Ownership of Shares. The Covered Shares issued pursuant to any
Restricted Stock Award shall be held by the Company's stock transfer agent
for the benefit of the Participant until the end of the applicable
Restricted Period. The Participant shall be identified as the beneficial
owner of the Covered Shares at the time the shares are issued.
(d) The Committee may designate whether any Award being granted to any
Participant under this Section 3 is intended to be performance-based
compensation. Any such Awards designated as intended to be
performance-based compensation shall be conditioned on the achievement of
one or more Performance Measures, to the extent required by Code section
162(m) and the regulations thereunder. For Awards under this Section 3
intended to be performance-based compensation, the grant of the Awards and
the establishment of the Performance Measures shall be made during the
period required under Code section 162(m).
(e) If the right to become vested in a Restricted Stock Award, Restricted
Stock Unit Award, Performance Share Award or Performance Unit Award
granted under this Section 3 is conditioned on the completion of a
specified period of service with the Company or the Subsidiaries, without
achievement of Performance Measures or other performance objectives being
required as a condition of either grant or vesting, and without it being
granted in lieu of other compensation, then the required period of service
for full vesting shall be not less than three years (subject to
acceleration of vesting, to the extent permitted by the Committee or
pursuant to the terms of an applicable Employment Agreement, in the event
of the Participant's death, disability, retirement, change in control or
involuntary termination).
Notwithstanding subsection 3.2(a), if a Participant is subject to an Employment
Agreement containing provisions which, by their terms, govern Awards of the type
described in this Section 3, such terms shall supersede the provisions of
subsection 3.2(a) with respect to such Participant's Awards, and if a
Participant is subject to an Employment Agreement containing
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definitions of cause, disability, retirement, change in control, or involuntary
termination, such definitions shall apply with respect to such Participant's
Awards granted under this Section 3. The provisions of subsection 3.2(d) of the
Plan (relating to minimum vesting periods) shall apply to an applicable Award,
regardless of any contrary terms contained in an Employment Agreement.
3.3 Non-Employee Director Stock Awards. Grants of Stock Awards to
Non-Employee Directors under the Plan shall be made only in accordance with the
terms, conditions and parameters for the compensation of Non-Employee Directors
as established from time to time by the Board and set forth in writing in the
Board Compensation Policy. The Committee may not make other discretionary grants
under the Plan to Non-Employee Directors.
SECTION 4
CASH INCENTIVE AWARDS
4.1. Eligibility. The Committee may designate any one or more Eligible
Individuals as Participants eligible to receive Cash Incentive Awards. Subject
to this Section 4, a Participant's right to receive Cash Incentive Awards shall
be contingent on the achievement of performance goals established for the
applicable performance period, as established by the Committee. Cash Incentive
Awards granted under the Plan are intended to be performance-based compensation,
and shall comply with the requirements of this Section 4 to the extent such
compliance is determined by the Committee to be required for the Cash Incentive
Awards to be treated as performance-based compensation.
4.2. Maximum Award. No more than $2,000,000 may be paid to any one
individual pursuant to Cash Incentive Awards granted under the Plan for any
annual performance period (provided that if a performance period is less than
one year, the limit shall be subject to a corresponding pro rata reduction). The
Committee may establish overlapping performance periods; provided that, to the
extent that the performance periods applicable to any individual overlap, the
limit (and the pro rata reduction required under the preceding sentence) with
respect to the second performance period shall be based on the portion of the
period that does not overlap with the prior period. For example, if a two-year
Cash Incentive Award is granted with a maximum payout of $2,000,000 for
performance in each of year 1 and year 2, an overlapping two-year Cash Incentive
Award may be granted with a maximum payout of $2,000,000 for performance in each
of year 2 and year 3 (i.e., year 2 performance could result in maximum payout of
$4,000,000 under the combined awards). Subject to Code section 162(m), if, after
amounts have been earned with respect to Cash Incentive Awards, the delivery of
such amounts is deferred, any additional amounts attributable to earnings during
the deferral period shall be disregarded for purposes of applying the annual
dollar limit imposed by this subsection 4.2.
4.3. Performance Goals. The performance goals established for the
performance period established by the Committee shall be objective (as that term
is described in regulations under Code section 162(m)), and shall be established
in writing by the Committee not later than 90 days after the beginning of the
performance period (but in no event after 25% of the performance period has
elapsed), and while the outcome as to the performance goals is substantially
uncertain. The performance goals established by the Committee may be with
respect to corporate performance, operating group or sub-group performance,
individual
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company performance, other group or individual performance, or division
performance, and shall be based on one or more of the Performance Measures.
4.4. Attainment of Performance Goals. A Participant otherwise entitled to
receive a Cash Incentive Award for any performance period shall not receive a
settlement of the Award until the Committee has determined that the applicable
performance goal(s) have been attained. To the extent that the Committee
exercises discretion in making the determination required by this subsection
4.4, such exercise of discretion may not result in an increase in the amount of
the payment.
4.5. Exceptions to Performance Goal Requirement. Except as otherwise
provided by the Committee, if a Participant's employment terminates because of
death or disability, or if a Change in Control occurs prior to the Participant's
termination of employment, the Participant's Cash Incentive Award shall become
vested without regard to whether the Cash Incentive Award would be
performance-based compensation.
4.6. Non-Performance-Based Cash Incentive Compensation. Nothing in this
Section 4 shall preclude the Committee, the Company, or any Subsidiary from
granting cash incentive awards outside of the Plan that are not intended to be
performance-based compensation.
SECTION 5
OPERATION AND ADMINISTRATION
5.1. Effective Date. The Plan, as amended and restated hereby, shall be
effective only if and when it is approved by the stockholders of the Company at
the Company's 2004 annual meeting of its stockholders (the "Effective Date"). If
the Plan, as proposed to be amended and restated hereby, is not approved by the
stockholders at the 2004 annual meeting, the Plan shall remain in full force and
effect in accordance with its terms as in effect immediately prior to the 2004
annual meeting date, and the term "Effective Date" as used herein shall refer to
the date on which the Plan was last approved by the stockholders of the Company.
No Awards may be granted under the Plan after the ten-year anniversary of the
Effective Date, but the Plan shall remain in effect as long as any Awards under
it are outstanding.
5.2. Shares Subject to Plan. The shares of Stock for which Awards may be
granted under the Plan shall be subject to the following:
(a) The shares of Stock with respect to which Awards may be made under the
Plan shall be shares currently authorized but unissued or currently held
or, to the extent permitted by applicable law, subsequently acquired by
the Company as treasury shares, including shares purchased in the open
market or in private transactions.
(b) Subject to the following provisions of this subsection 5.2, the maximum
number of shares of Stock that may be delivered to Participants and their
beneficiaries under the Plan shall be 6,000,000 shares of Stock.
(c) To the extent provided by the Committee, any Award may be settled in cash
rather than Stock. To the extent any shares of Stock covered by an Award
are not delivered to a Participant or beneficiary because the Award is
forfeited, or the shares of Stock are not
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delivered because the Award is settled in cash or used to satisfy the
applicable tax withholding obligation, such shares shall not be deemed to
have been delivered for purposes of determining the maximum number of
shares of Stock available for delivery under the Plan.
(d) If the exercise price of any Option granted under the Plan is satisfied by
tendering shares of Stock to the Company (by either actual delivery or by
attestation), only the number of shares of Stock issued net of the shares
of Stock tendered shall be deemed delivered for purposes of determining
the maximum number of shares of Stock available for delivery under the
Plan. However, if outstanding shares of Stock (including shares issued on
the date of grant of an Award, as in the form of Bonus Stock or a
Restricted Stock Award) are tendered to the Company (by either actual
delivery or by attestation) to satisfy the tax liability resulting from an
Award, such tendered shares shall be deemed to have been delivered to the
Participant for purposes of determining the maximum number of shares of
Stock available for delivery under the Plan (and such shares shall not be
added back to the available share pool under the Plan).
(e) Subject to subsection 5.2(f), the following additional maximums are
imposed under the Plan.
(i) The maximum number of shares that may be covered by Awards granted to
any one individual pursuant to Section 2 (relating to Options and SARs)
shall be 1,500,000 shares during any one calendar-year period. If an
Option is in tandem with an SAR, such that the exercise of the Option or
SAR with respect to a share of Stock cancels the tandem SAR or Option
right, respectively, with respect to such share, the tandem Option and SAR
rights with respect to each share of Stock shall be counted as covering
but one share of Stock for purposes of applying the limitations of this
subsection (i).
(ii) The maximum number of shares of Stock that may be issued over the
term of the Plan in conjunction with Awards granted pursuant to Section 3
(relating to Other Stock Awards) shall be 900,000 shares.
(iii) No more than 900,000 shares of Stock may be subject to Bonus Stock
Awards, Stock Unit Awards, Restricted Stock Awards, Restricted Stock Unit
Awards and Performance Share Awards granted under the Plan to any one
individual during any one-calendar-year period. If, after shares have been
earned, the delivery is deferred, any additional shares attributable to
dividends during the deferral period shall be disregarded for purposes of
applying the annual share limit imposed by this subsection 5.2(e)(iii) and
the overall share limit imposed by subsection 5.2(e)(ii).
(iv) No more than $2,000,000 may be subject to a Performance Unit Award
granted to any one individual during any one-calendar-year period. If,
after amounts have been earned with respect to Performance Unit Awards,
the delivery of such amounts is deferred, any additional amounts
attributable to earnings during the deferral period shall be disregarded
for purposes of applying the annual dollar limit imposed by this
subsection 5.2(e)(iv).
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(f) If (i) the outstanding securities of the class then subject to this Plan
(the "outstanding shares") (A) are increased, decreased, exchanged or
converted as a result of a stock split (including a split in the form of a
stock dividend), reverse stock split, recapitalization, spin off or
similar event, or (B) are exchanged for or converted into cash, property
or a different number or kind of securities (or if cash, property or
securities are distributed in respect of the outstanding shares), as a
result of a reorganization, merger, consolidation, exchange, spin off,
recapitalization, restructuring or reclassification, or (ii) substantially
all of the property and assets of the Company are sold as an entirety, or
(iii) the Company is liquidated and dissolved, then the Committee (or, in
the case of Awards made to Non-Employee Directors, the Board) shall, in
such manner and to such extent (if any) as is equitable and appropriate,
make proportionate adjustments in (x) the number and type of shares or
other securities or cash or other property that may be acquired pursuant
to Options and other Awards previously granted under this Plan (and, where
applicable, the exercise price thereof so as to maintain the same
aggregate exercise price), (y) the maximum number and type of shares or
other securities, cash, or property that may be issued or delivered
pursuant to Options and other Awards thereafter granted under this Plan,
and (z) such other terms as necessarily are affected by such event. In the
case of an extraordinary distribution, merger, reorganization,
consolidation, combination, sale of assets, exchange or spin off, the
Committee (or the Board, in the case of Awards made to Non-Employee
Directors) may make provisions for a substitution or exchange of any or
all outstanding Options or other Awards or rights (or for the securities,
cash or property deliverable upon exercise of such outstanding Options or
other Awards or rights), based upon the distribution or consideration
payable to holders of the shares of Stock upon or in respect of such
event.
5.3. General Restrictions. Delivery of shares of Stock or other amounts
under the Plan shall be subject to the following:
(a) Notwithstanding any other provision of the Plan, the Company shall have no
liability to deliver any shares of Stock under the Plan or make any other
distribution of benefits under the Plan unless such delivery or
distribution would comply with all applicable laws (including, without
limitation, the requirements of the Securities Act of 1933), and the
applicable requirements of any securities exchange or similar entity.
(b) To the extent that the Plan provides for issuance of stock certificates to
reflect the issuance of shares of Stock, the issuance may be effected on a
non-certificated basis, to the extent not prohibited by applicable law or
the applicable rules of any stock exchange.
5.4. Tax Withholding. All distributions under the Plan (other than to
Non-Employee Directors) are subject to withholding of all applicable taxes, and
the Committee may condition the delivery of any shares or other benefits under
the Plan on satisfaction of the applicable withholding obligations. Except as
otherwise provided by the Committee, such withholding obligations may be
satisfied (i) through cash payment by the Participant, (ii) through the
surrender, by either actual delivery of shares or by attestation, of shares of
Stock acceptable to the Committee which the Participant already owns (provided
that any such shares used in payment shall have been owned by the Participant
for at least such period of time, if any, as is necessary to avoid variable
accounting for the Award); or (iii) through the surrender of shares of
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Stock to which the Participant is otherwise entitled under the Plan; provided,
however, that, to the extent necessary to avoid variable accounting for the
Award, such shares under this clause (iii) may be used to satisfy not more than
the Company's minimum statutory withholding obligation (based on minimum
statutory withholding rates for Federal and state tax purposes, including
payroll taxes, that are applicable to such supplemental taxable income).
5.5. Grant and Use of Awards. Subject to subsections 2.7 and 3.3 (relating
to Awards to Non-Employee Directors), in the discretion of the Committee, a
Participant may be granted any Award permitted under the provisions of the Plan,
and more than one Award may be granted to a Participant. Subject to subsection
2.9 (relating to Option repricing), Awards may be granted as alternatives to or
replacement of awards granted or outstanding under the Plan, or any other plan
or arrangement of the Company or a Subsidiary (including a plan or arrangement
of a business or entity, all or a portion of which is acquired by the Company or
a Subsidiary). Subject to the overall limitation on the number of shares of
Stock that may be delivered under the Plan, the Committee may use available
shares of Stock as the form of payment for compensation, grants or rights earned
or due under any other compensation plans or arrangements of the Company or a
Subsidiary, including the plans and arrangements of the Company or a Subsidiary
assumed in business combinations.
5.6. Dividends and Dividend Equivalents. An Award (including without
limitation an Option or SAR Award) may provide the Participant with the right to
receive dividend payments or dividend equivalent payments with respect to Stock
subject to the Award (both before and after the Stock subject to the Award is
earned, vested, or acquired), which payments may be either made currently or
credited to an account for the Participant, and may be settled in cash or Stock,
as determined by the Committee. Any such settlements, and any such crediting of
dividends or dividend equivalents or reinvestment in shares of Stock, may be
subject to such conditions, restrictions and contingencies as the Committee
shall establish, including the reinvestment of such credited amounts in Stock
equivalents. Dividends or dividend equivalents paid in Stock with respect to an
Award before the Stock subject to the Award is earned, vested, or acquired shall
be deemed delivered under the Plan for purposes of applying the share limits in
subsections 5.2(b) and 5.2(e).
5.7. Settlement of Awards. The obligation to make payments and
distributions with respect to Awards may be satisfied through cash payments, the
delivery of shares of Stock, the granting of replacement Awards, or combination
thereof as the Committee shall determine. Satisfaction of any such obligations
under an Award, which is sometimes referred to as "settlement" of the Award, may
be subject to such conditions, restrictions and contingencies as the Committee
shall determine. Subject to applicable tax laws relating to deferred
compensation, the Committee may permit or require the deferral of any Award
payment, subject to such rules and procedures as it may establish, which may
include provisions for the payment or crediting of interest or dividend
equivalents, and may include converting such credits into deferred Stock
equivalents. Each Subsidiary shall be liable for payment of cash due under the
Plan with respect to any Participant to the extent that such benefits are
attributable to the services rendered for that Subsidiary by the Participant.
Any disputes relating to liability of a Subsidiary for cash payments shall be
resolved by the Committee.
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5.8. Transferability. Except as otherwise provided by the Committee,
Awards may not be sold, transferred, assigned, pledged, hypothecated or
otherwise disposed of in any way (whether by operation of law or otherwise)
except as designated by the Participant by will or by the laws of descent and
distribution.
5.9. Form and Time of Elections. Unless otherwise specified herein, each
election required or permitted to be made by any Participant or other person
entitled to benefits under the Plan, and any permitted modification, or
revocation thereof, shall be in writing filed with the senior Human Resources
manager for the Company, or his or her delegates, at such times, in such form,
and subject to such restrictions and limitations, not inconsistent with the
terms of the Plan, as the senior Human Resources manager for the Company, or his
or her delegates, shall require.
5.10. Agreement With Company. An Award under the Plan shall be subject to
such terms and conditions, not inconsistent with the Plan, as the Committee
shall, in its sole discretion, prescribe. All Awards shall be evidenced by a
writing with a schedule memorializing the grant of the Award to the Participant
and setting forth certain specifics with respect to the terms and conditions of
the Award. A copy of such document shall be provided to the Participant. Such
document is referred to in the Plan as an "Award Memorandum."
5.11. Action by Company or Subsidiary. Any action required or permitted to
be taken by the Company or any Subsidiary shall be by resolution of its board of
directors, or by action of one or more members of the board (including a
committee of the board) who are duly authorized to act for the board, or (except
to the extent prohibited by applicable law or applicable rules of any stock
exchange) by a duly authorized officer of such company.
5.12. Gender and Number. Where the context admits, words in any gender
shall include any other gender, words in the singular shall include the plural
and the plural shall include the singular.
5.13. Limitation of Implied Rights.
(a) Neither a Participant nor any other person shall, by reason of
participation in the Plan, acquire any right in or title to any assets,
funds or property of the Company or any Subsidiary whatsoever, including,
without limitation, any specific funds, assets, or other property which
the Company or any Subsidiary, in its sole discretion, may set aside in
anticipation of a liability under the Plan. A Participant shall have only
a contractual right to the Stock or amounts, if any, payable under the
Plan, unsecured by any assets of the Company or any Subsidiary, and
nothing contained in the Plan shall constitute a guarantee that the assets
of the Company or any Subsidiary shall be sufficient to pay any benefits
to any person.
(b) The Plan does not constitute a contract of employment, and selection as a
Participant will not give any participating employee the right to be
retained in the employ of the Company or any Subsidiary, nor any right or
claim to any benefit under the Plan, unless such right or claim has
specifically accrued under the terms of the Plan. Except as otherwise
provided in the Plan, no Award under the Plan shall confer upon the holder
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thereof any rights as a stockholder of the Company prior to the date on
which the individual fulfills all conditions for receipt of such rights.
5.14. Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the person acting on
it considers pertinent and reliable, and signed, made or presented by the proper
party or parties.
5.15. Heirs and Successors. Awards granted under this Plan shall be
binding upon, and inure to the benefit of, the Company and its successors and
assigns, and upon any person acquiring, whether by merger, consolidation,
purchase of assets or otherwise, all or substantially all of the Company's
assets and business. If any rights exercisable by the Participant or benefits
deliverable to the Participant under such Award have not been exercised or
delivered, respectively, at the time of the Participant's death, such rights
shall be exercisable by the Designated Beneficiary, and such benefits shall be
delivered to the Designated Beneficiary, in accordance with the provisions of
the Plan. The "Designated Beneficiary" shall be the beneficiary or beneficiaries
designated by the Participant in a writing filed with the Committee in such form
and at such time as the Committee shall require. If a deceased Participant fails
to designate a beneficiary, or if the Designated Beneficiary does not survive
the Participant, any rights that would have been exercisable by the Participant
and any benefits distributable to the Participant shall be exercised by or
distributed to the legal representative of the estate of the Participant. If a
deceased Participant designates a beneficiary and the Designated Beneficiary
survives the Participant but dies before the Designated Beneficiary's exercise
of all rights under the Award or before the complete distribution of benefits to
the Designated Beneficiary under the Award, then any rights that would have been
exercisable by the Designated Beneficiary shall be exercised by the legal
representative of the estate of the Designated Beneficiary, and any benefits
distributable to the Designated Beneficiary shall be distributed to the legal
representative of the estate of the Designated Beneficiary.
5.16. Applicable Law. The provisions of this Agreement shall be construed
in accordance with the laws of the State of Delaware, without regard to the
conflict of law provisions of any jurisdiction.
SECTION 6
CHANGE IN CONTROL
6.1. Determination of Change in Control. Subject to subsection 6.2 below,
a "Change in Control" shall be deemed to occur for purposes of this Plan upon
the occurrence of any one of the following events:
(A) An acquisition of any common stock or other "Voting Securities" (as
hereinafter defined) of the Company by any "Person" (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act")), immediately after which such
Person has "Beneficial Ownership" (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of twenty five percent (25%) or more
of the then outstanding shares of the Company's common stock or the
combined voting power of the Company's then outstanding Voting Securities;
provided, however, in determining whether a Change in Control has
occurred, Voting Securities
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which are acquired in a "Non-Control Acquisition" (as hereinafter defined)
shall not constitute an acquisition which would cause a Change in Control.
For purposes of this Plan, (1) "Voting Securities" shall mean the
Company's outstanding voting securities entitled to vote generally in the
election of directors and (2) a "Non-Control Acquisition" shall mean an
acquisition by (a) the Company or any of its Subsidiaries, (b) an employee
benefit plan (or a trust forming a part thereof) maintained by (x) the
Company, or (y) any corporation or other Person of which a majority of its
voting power or its voting equity securities or equity interest is owned,
directly or indirectly, by the Company (for purposes of the definition in
this subsection 6.1, a "Subsidiary"), or (c) any Person in connection with
a "Non-Control Transaction" (as hereinafter defined).
(B) The individuals who, as of the Effective Date, were members of the Board
(the "Incumbent Board"), cease for any reason to constitute at least a
majority of the members of the Board; provided, however, that if the
election, or nomination for election by the Company's common stockholders,
of any new director was approved by a vote of at least two-thirds of the
Incumbent Board, such new director shall, for purposes of this Plan be
considered as a member of the Incumbent Board; provided further, however,
that no individual shall be considered a member of the Incumbent Board if
such individual initially assumed office as a result of either an actual
or threatened "Election Contest" (as described in Rule 14a-11 promulgated
under the Exchange Act) or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board (a
"Proxy Contest") including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest; or
(C) The consummation of:
(1) A merger, consolidation, or reorganization involving the Company or
the sale or other disposition of all or substantially all of the
assets of the Company to any Person or Persons other than a transfer
to a Subsidiary, or the sale or other disposition of all or
substantially all of the stock or assets of IndyMac Bank, F.S.B. to
any Person or Persons other than a transfer to a Subsidiary (in each
case, a "Business Transaction"), unless such Business Transaction is
a "Non-Control Transaction." A "Non Control Transaction" shall mean
a Business Transaction where:
(a) the stockholders of the Company, immediately before such
Business Transaction, own directly or indirectly immediately
following such Business Transaction more than sixty percent
(60% ) of the combined voting power of the outstanding Voting
Securities of the corporation resulting from such merger,
consolidation or reorganization or purchasing such assets or
stock (the "Surviving Corporation") in substantially the same
proportion as their ownership of the Voting Securities
immediately before such Business Transaction;
(b) the individuals who were members of the Incumbent Board
immediately prior to the execution of the agreement providing
for such Business Transaction constitute at least a majority
of the members of the board of
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directors of the Surviving Corporation, or in the event that,
immediately following the consummation of such Business
Transaction, a corporation beneficially owns, directly or
indirectly, a majority of the Voting Securities of the
Surviving Corporation, the board of directors of such
corporation; and
(c) no Person other than (i) the Company, (ii) any Subsidiary,
(iii) any employee benefit plan (or any trust forming a part
thereof) maintained by the Company, the Surviving Corporation
or any Subsidiary, or (iv) any Person who, immediately prior
to such Business Transaction had Beneficial Ownership of
twenty-five percent (25%) or more of the then outstanding
Voting Securities or common stock of the Company, has
Beneficial Ownership of twenty-five percent (25%) or more of
the combined voting power of the Surviving Corporation's then
outstanding Voting Securities or its common stock; or
(D) The Company's stockholders approve a complete liquidation or dissolution
of the Company.
Notwithstanding the foregoing provisions of this subsection 6.1, a Change in
Control shall not be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the permitted amount of the
then outstanding common stock or Voting Securities as a result of the
acquisition of common stock or Voting Securities by the Company which, by
reducing the number of shares of common stock or Voting Securities then
outstanding, increases the proportional number of shares Beneficially Owned by
the Subject Person; provided, however, that if a Change in Control would occur
(but for the operation of this sentence) as a result of the acquisition of
common stock or Voting Securities by the Company, and after such share
acquisition by the Company, the Subject Person becomes the Beneficial Owner of
any additional common stock or Voting Securities which increases the percentage
of the then outstanding common stock or Voting Securities Beneficially Owned by
the Subject Person, then a Change in Control shall occur.
6.2. Notwithstanding the provisions of this section 6.2, the Board, in the
exercise of its reasonable discretion, may, but need not, make an affirmative
determination prior to the consummation of a Business Transaction (as defined in
subsection 6.1(C)) that, in light of all circumstances, such Business
Transaction will be not be treated as a Change in Control for purposes of this
Plan, by reason of it being in essence a "combination of equals" or for any
other reason. In making any such determination, the Board shall give due
consideration, without limitation, to the likely effect of such transaction(s)
on the makeup of the stockholder base, the Board and the senior management of
the Company.
6.3. Committee Action. Except as otherwise provided in an Award Memorandum
or a written agreement between the Company and a Participant to the contrary, in
the event of a Change in Control, then all outstanding Awards previously granted
to the Participant hereunder that have not already vested shall vest on the
first anniversary of the Change in Control; provided, however, that in the event
that a Participant's employment with IndyMac or any successor employee is
terminated within one (1) year following a Change in Control (i) by
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reason of the Participant's Disability or Death, or (ii) either by the employer
without Cause or by the Participant for Good Reason, then all outstanding Awards
previously granted to the Participant hereunder that have not already vested
shall vest on the date of such termination of employment. In the event of such
acceleration of "vesting," each Option and SAR shall become immediately
exercisable, and (B) outstanding Stock Awards granted under Section 3 shall
immediately vest free of restrictions, and shall become payable to the
Participant. Notwithstanding the foregoing and anything to the contrary herein,
prior to a Change in Control, the Committee may in its sole discretion amend
this section 6.3 to alter the acceleration of Awards in the event of a Change in
Control, including, without limitation, to provide for immediate acceleration of
awards or to prohibit or otherwise limit such acceleration. The Committee may
accord any holder of an Award a right to refuse any acceleration, whether
pursuant to the Award Memorandum or otherwise, in such circumstances as the
Committee may approve. In determining whether and in what manner to accelerate
the vesting of Awards under the Plan, the Committee shall consider the effect
thereof under applicable regulatory and financial accounting principles,
including without limitation section 422 of the Code.
6.4. Termination or Substitution of Awards. Any Awards that are (or but
for a holder's rejection of acceleration would have been) accelerated under this
Section 6 and that are not exercised or vested prior to a dissolution of the
Company or a reorganization event described in subsection 6.1 that the Company
does not survive shall terminate, provided that if provision has been made,
consistent with the terms hereof, for the substitution, exchange or other
settlement of Awards, such Awards shall be substituted, exchanged or otherwise
settled in accordance with such provision.
6.5. Restoration of Prior Status. Any Awards that are (or but for the
holder's rejection of the acceleration would have been) accelerated under this
Section 6 and that are not exercised or vested prior to an abandonment or
termination of a transaction subject to stockholder approval that triggered the
Change in Control (as evidenced by public announcement, Board resolution,
execution of documents terminating the transaction, or other action or document
objectively confirming such abandonment or termination), shall be restored to
their prior status (except for the effects of the passage of time) as if no
Change in Control had occurred.
6.6. Employment Agreement. Notwithstanding any other provision of this
Section 6 to the contrary, if a Participant is subject to an Employment
Agreement containing provisions which, by their terms, govern the effect of a
change in control, such terms shall supersede the provisions of this Section 6
with respect to such Participant's Awards, and if a Participant is subject to an
Employment Agreement containing a definition of Change in Control, such
definition shall supersede the definition of Change in Control set forth in this
Section 6 with respect to such Participant's Awards.
SECTION 7
COMMITTEE
7.1. Administration. The authority to control and manage the operation and
administration of the Plan shall be vested in a committee (the "Committee") in
accordance with this Section 7. The Committee shall be selected by the Board,
and shall consist of two or more members of the Board. If the Committee does not
exist, or for any other reason determined by
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the Board, the Board may take any action under the Plan that would otherwise be
the responsibility of the Committee.
7.2. Powers of Committee. The Committee's administration of the Plan shall
be subject to the following:
(a) Subject to the provisions of the Plan, the Committee will have the
authority and discretion to select from among the Eligible Individuals
those persons who shall receive Awards, to determine the time or times of
receipt, to determine the types of Awards and the amount or number of
shares covered by the Awards, to establish the terms, conditions,
performance criteria, restrictions, and other provisions of such Awards,
and (subject to the restrictions imposed by subsection 2.9, relating to
Option repricing, and by Section 8, relating to amendments and
termination) to modify, accelerate the vesting of, cancel or suspend
Awards.
(b) To the extent that the Committee determines that the restrictions imposed
by the Plan preclude the achievement of the material purposes of the
Awards in jurisdictions outside the United States, the Committee will have
the authority and discretion to modify those restrictions as the Committee
determines to be necessary or appropriate to conform to applicable
requirements or practices of jurisdictions outside of the United States.
(c) The Committee will have the authority and discretion to interpret the
Plan, to establish, amend, and rescind any rules and regulations relating
to the Plan, to determine the terms and provisions specified in any Award
Memorandum made pursuant to the Plan, and to make all other determinations
that may be necessary or advisable for the administration of the Plan.
(d) Any interpretation of the Plan by the Committee and any decision made by
it under the Plan are final and binding on all persons.
(e) In controlling and managing the operation and administration of the Plan,
the Committee shall take action in a manner that conforms to the
certificate of incorporation and by-laws of the Company, and applicable
state corporate law.
7.3. Delegation by Committee. Except to the extent prohibited by
applicable law or the applicable rules of a stock exchange, the Committee 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 and
powers to any person or persons selected by it. The Committee also may delegate
to certain officers of the Company the authority to grant Awards pursuant to the
provisions of the Plan, provided that such delegation is set forth in writing
and includes all applicable limitations and parameters to such Awards, and
provided further that such Awards are subsequently ratified by the Committee.
Any such allocation or delegation may be revoked by the Committee at any time.
Subject to the foregoing, and except as to the grant of Awards under the Plan
and establishment of the terms of grant under the Plan, all ministerial,
non-discretionary powers of the Committee under the Plan are delegated to the
senior Human Resources manager for the Company and his or her delegates.
- 16 -
7.4. Information to be Furnished to Committee. The Company and its
Subsidiaries shall furnish the Committee with such data and information as it
determines may be required for it to discharge its duties. The records of the
Company and its Subsidiaries as to an employee's or Participant's employment or
period of service, termination of employment or service, leave of absence,
reemployment and compensation shall be conclusive on all persons unless
determined to be incorrect. Participants and other persons entitled to benefits
under the Plan must furnish the Committee such evidence, data or information as
the Committee considers desirable to carry out the terms of the Plan.
SECTION 8
AMENDMENT AND TERMINATION
The Board may, at any time, amend or terminate the Plan, and may amend any
Award Memorandum, provided that no amendment or termination may, in the absence
of written consent to the change by the affected Participant (or, if the
Participant is not then living, the affected beneficiary), adversely affect the
rights of any Participant or beneficiary under any Award granted under the Plan
prior to the date such amendment is adopted by the Board; and further provided
that adjustments pursuant to subsection 5.2(f) shall not be subject to the
foregoing limitations of this Section 8; and further provided that the
provisions of subsection 2.9 (relating to Option repricing) cannot be amended
unless the amendment is approved by the Company's stockholders.
SECTION 9
DEFINED TERMS
In addition to the other definitions contained herein, the following
definitions shall apply:
(a) Award. The term "Award" means any award or benefit granted under the Plan,
including, without limitation, the grant of Options, SARs, Bonus Stock
Awards, Stock Unit Awards, Restricted Stock Awards, Restricted Stock Unit
Awards, Performance Unit Awards, Performance Share Awards, Cash Incentive
Awards, and dividends or dividend equivalents granted with respect to an
Award.
(b) Board. The term "Board" means the Board of Directors of the Company.
(c) Cause. The term "Cause" shall have the meaning assigned such term in the
Employment Agreement, if any, between a Participant and the Company or an
affiliate, provided, however that if there is no such Employment Agreement
in which such term is defined, and unless otherwise defined in the
applicable Award, "Cause" shall mean, with respect to any Employee,
termination of employment with the Company or any Subsidiary on account of
any act of (i) fraud or intentional misrepresentation, (ii) embezzlement,
misappropriation or conversion of assets or opportunities of the Company
or any subsidiary or affiliate, or (iii) conviction of a felony.
(d) Code. The term "Code" means the Internal Revenue Code of 1986, as amended.
A reference to any provision of the Code shall include reference to any
successor provision of the Code.
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(e) Covered Shares. The term "Covered Shares" means the shares of Stock that
are the subject of an Award granted under the Plan.
(f) Date of Termination. The term "Date of Termination" means the first day
occurring on or after the Grant Date on which the Employee is not employed
by the Company or any Subsidiary, regardless of the reason for the
termination of employment; provided that a termination of employment shall
not be deemed to occur by reason of a transfer of the Employee between the
Company and a Subsidiary or between two Subsidiaries; and further provided
that the Employee's employment shall not be considered terminated while
the Employee is on a military or sick leave from the Company or a
Subsidiary. If an Employee is employed by an entity that is a Subsidiary
and such entity ceases to be a Subsidiary, such event shall be deemed to
be the Employee's Date of Termination.
(g) Director. The term "Director" means a member of the Board or the Board of
Directors of IndyMac Bank, F.S.B.
(h) Disability. The term "Disability" shall mean a "permanent and total
disability" within the meaning of section 22(e)(3) of the Code.
(i) Eligible Individual. For purposes of the Plan, the term "Eligible
Individual" means any employee, officer, or director of the Company or a
Subsidiary, and any consultant or other person providing services to the
Company or a Subsidiary; provided, however, that an ISO may only be
granted to an employee of the Company or a Subsidiary. An Award may be
granted to an employee, in connection with hiring, retention or otherwise,
prior to the date the employee first performs services for the Company or
the Subsidiaries, provided that such Awards shall not become vested prior
to the date the employee first performs such services.
(j) Employee. An " Employee" is any employee of the Company or a Subsidiary
who is granted an Award under the Plan.
(k) Employment Agreement. A Participant's "Employment Agreement" means, as of
any date, the agreement (if any) between the Participant and the Company
or a Subsidiary that governs the terms of such Participant's employment on
that date, and may include a change in control agreement governing the
effect of a change in control with respect to such Participant and, with
respect to the Participant's termination of employment, may also include a
severance agreement governing the terms of such Participant's termination
from employment.
(l) Fair Market Value. For purposes of determining the "Fair Market Value" of
a share of Stock as of any date, the following rules shall apply:
(i) (A) If shares of Stock are listed or admitted to trade on a national
securities exchange, the average of the high and low reported sales prices
of the shares of Stock on the Composite Tape on such date, as published in
the Western Edition of The Wall Street Journal, on the principal national
securities exchange on which the shares of Stock are so listed or admitted
to trade. (B) If the Stock is not listed or admitted to trade on a
national securities exchange, the average of the high and low reported
prices for the Stock on such
- 18 -
date, as furnished by the National Association of Securities Dealers, Inc.
("NASD") through the NASDAQ National Market Reporting System (or a similar
organization, if the NASD is no longer reporting such information). (C) If
the Stock is not listed or admitted to trade on a national securities
exchange and are not reported on the National Market Reporting System, the
arithmetic mean between the bid and asked prices for the Shares on such
date, as furnished by the NASD or a similar organization. (D) If the Stock
is not listed or admitted to trade on a national securities exchange nor
reported on the National Market Reporting System and if bid and asked
prices for the stock are not furnished by the NASD or a similar
organization, the value as established by the Board at such time for
purposes of this Plan.
(ii) If the day is not a business day, and as a result, subsection (i)
next above is inapplicable, the Fair Market Value of the Stock shall be
determined as of the next earlier business day.
(m) The term "Good Reason" shall have the meaning assigned such term in the
Employment Agreement, if any, between a Participant and the Company or an
affiliate, provided, however that if there is no such Employment Agreement
in which such term is defined, and unless otherwise defined in the
applicable Award, "Good Reason" shall mean, with respect to any Employee,
any of the following acts by the Company or an affiliate, without the
consent of the Participant (in each case, other than an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company or the affiliate promptly after receipt of notice
thereof given by the Participant): (i) the assignment to the Participant
of duties materially inconsistent with, or a material diminution in, the
Participant's position, authority, duties or responsibilities as in effect
immediately prior to a Change in Control, (ii) a reduction by the Company
or an affiliate in the Participant's base salary, (iii) the Company or an
affiliate requiring the Participant, without his or her consent, to be
based at any office or location more than 35 miles from the location at
which the Participant was stationed immediately prior to a Change in
Control, (iv) the continuing material breach by the Company or an
affiliate of any Employment Agreement between the Participant and the
Company or an affiliate after the expiration of any applicable period for
cure, or (v) the expiration an Employment Agreement between the Employee
and the Company or any affiliate in effect prior to a Change in Control
without renewal by the Company or its successor on or following a Change
in Control on terms that are substantially comparable to the terms of such
Employment Agreement.
(n) Grant Date. The term "Grant Date" with respect to an Award means the date
on which the Award is granted under this Plan.
(o) Non-Employee Director. Each Director who is not an employee of the Company
or any Subsidiary shall be a "Non-Employee Director."
(p) Performance-Based Compensation. The term "performance-based compensation"
shall have the meaning ascribed to it in section 162(m) of the Code and
the regulations thereunder.
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(q) Performance Measures. The Performance Measures (which must be quantitative
and objective standards and not qualitative) that may be used by the
Committee for such Awards shall be based on any one or more of the
following, as selected by the Committee: core earnings; net worth; asset
quality; efficiency ratio; loan origination; deposit growth; interest rate
risk; earnings per share; return on average common equity; return on
average equity; net operating expense, either before or after amortization
of intangible assets (goodwill); operating earnings (earnings before
transaction-related expense) per diluted share of common stock, either
before or after amortization of intangible assets (goodwill); return on
average assets, ratio of non-performing assets to total assets; customer
service; and regulatory compliance.
(r) Restricted Period. The term "Restricted Period" means the period during
which the shares of Stock subject to an Award of Restricted Stock or a
Restricted Stock Unit Award remain unvested, as set forth in the Plan or
the applicable Award Memorandum or Employment Agreement.
(s) Retirement. An Employee's "Retirement" shall mean retirement or
resignation after at least five (5) consecutive years of employment with
the Company or a Subsidiary and the attainment of age 55.
(t) Subsidiary. The term "Subsidiary" means any company during any period in
which it is a "subsidiary corporation" (as that term is defined in Code
section 424(f)) with respect to the Company.
(u) Stock. The term "Stock" means shares of common stock of the Company.
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