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EXHIBIT 10.1
INTERNATIONAL AIRCRAFT INVESTORS
1996 STOCK OPTION AND AWARD PLAN
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TABLE OF CONTENTS
Page
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I. THE PLAN...................................................................................... 1
1.1 Purpose.............................................................................. 1
1.2 Administration and Authorization; Power and Procedure................................ 1
1.3 Participation........................................................................ 2
1.4 Shares Available for Awards.......................................................... 3
1.5 Grant of Awards...................................................................... 4
1.6 Award Period......................................................................... 4
1.7 Limitations on Exercise and Vesting of Awards........................................ 4
1.8 Acceptance of Notes to Finance Exercise.............................................. 5
1.9 No Transferability................................................................... 5
II. EMPLOYEE OPTIONS.............................................................................. 6
2.1 Grants............................................................................... 6
2.2 Option Price......................................................................... 7
2.3 Limitations on Grant and Terms of Incentive Stock Options............................ 7
2.4 Limits on 10% Holders................................................................ 8
2.5 Option Repricing/Cancellation and Regrant/Waiver of Restrictions..................... 8
2.6 Options and Rights in Substitution for Stock Options Granted by
Other Corporations............................................................................ 9
III. STOCK APPRECIATION RIGHTS..................................................................... 9
3.1 Grants............................................................................... 9
3.2 Exercise of SARs..................................................................... 9
3.3 Payment.............................................................................. 10
3.4 Limited SARs......................................................................... 10
IV. RESTRICTED STOCK AWARDS....................................................................... 10
4.1 Grants............................................................................... 10
4.2 Restrictions......................................................................... 11
4.3 Return to the Corporation............................................................ 11
V. PERFORMANCE SHARE AWARDS AND STOCK BONUSES.................................................... 12
5.1 Grants of Performance Share Awards................................................... 12
5.2 Grants of Stock Bonuses.............................................................. 12
5.3 Deferred Payments.................................................................... 12
5.4 Special Performance-Based Share Awards............................................... 13
VI. OTHER PROVISIONS.............................................................................. 14
6.1 Rights of Eligible Employees, Participants and Beneficiaries......................... 14
6.2 Adjustments; Acceleration............................................................ 14
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6.3 Termination of Service; Termination of Subsidiary Status;
Discretionary Provisions............................................................. 16
6.4 Compliance With Laws................................................................. 17
6.5 Tax Withholding...................................................................... 17
6.6 Plan Amendment, Termination and Suspension........................................... 18
6.7 Privileges of Stock Ownership........................................................ 18
6.8 Effective Date of this Plan.......................................................... 18
6.9 Term of this Plan.................................................................... 19
6.10 Governing Law/Construction/Severability.............................................. 19
6.11 Captions............................................................................. 19
6.12 Non-Exclusivity of Plan.............................................................. 20
VII. DEFINITIONS................................................................................... 20
7.1 Definitions.......................................................................... 20
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INTERNATIONAL AIRCRAFT INVESTORS
1996 STOCK OPTION AND AWARD PLAN
I. THE PLAN.
1.1 Purpose.
The purpose of this Plan is to promote the success of the
Company and the interests of its stockholders by providing an additional means
through the grant of Awards to attract, motivate, retain and reward key
employees and other selected persons by providing them long-term incentives to
improve the financial performance of the Company. "Corporation" means
International Aircraft Investors, a California corporation, and its successors,
and "Company" means the Corporation and its Subsidiaries, collectively. These
terms and other capitalized terms are defined in Article VII.
1.2 Administration and Authorization; Power and Procedure.
(a) Committee. This Plan shall be administered by, and all Awards to
Eligible Employees shall be authorized by, the Committee. Action of the
Committee with respect to the administration of this Plan shall be taken
pursuant to a majority vote or by written consent of its members.
(b) Plan Awards; Interpretation; Powers of Committee. Subject to the
express provisions of this Plan, the Committee shall have the authority:
(i) to determine from among those persons eligible the
particular Eligible Employees who will receive Awards;
(ii) to grant Awards to Eligible Employees, determine the price at
which securities will be offered or awarded and the amount of
securities to be offered or awarded to any of such persons, and
determine the other specific terms and conditions of such Awards
consistent with the express limits of this Plan, and establish the
installments (if any) in which such Awards shall become exercisable or
shall vest, or determine that no delayed exercisability or vesting is
required, and establish the events of termination or reversion of such
Awards;
(iii) to approve the forms of Award Agreements (which need not
be identical either as to type of award or among Participants);
(iv) to construe and interpret this Plan and any agreements
defining the rights and obligations of the Company and Employee
Participants under this Plan,
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further define the terms used in this Plan, and prescribe, amend and
rescind rules and regulations relating to the administration of this
Plan;
(v) to cancel, modify, or waive the Corporation's rights with
respect to, or modify, discontinue, suspend, or terminate any or all
outstanding Awards held by Eligible Employees, subject to any required
consent under Section 6.6;
(vi) to accelerate or extend the exercisability or extend the
term of any or all such outstanding Awards within the maximum ten-year
term of Awards under Section 1.6; and
(vii) to make all other determinations and take such other
action as contemplated by this Plan or as may be necessary or advisable
for the administration of this Plan and the effectuation of its
purposes.
(c) Binding Determinations. Any action taken by, or inaction of, the
Corporation, any Subsidiary, the Board or the Committee relating or pursuant to
this Plan shall be within the absolute discretion of that entity or body and
shall be conclusive and binding upon all persons. No member of the Board or
Committee, or officer of the Corporation or any Subsidiary, shall be liable for
any such action or inaction of the entity or body, of another person or, except
in circumstances involving bad faith, of himself or herself. Subject only to
compliance with the express provisions hereof, the Board and Committee may act
in their absolute discretion in matters within their authority related to this
Plan.
(d) Reliance on Experts. In making any determination or in taking or
not taking any action under this Plan, the Committee or the Board, as the case
may be, may obtain and may rely upon the advice of experts, including
professional advisors to the Corporation. No director, officer or agent of the
Company shall be liable for any such action or determination taken or made or
omitted in good faith.
(e) Delegation. The Committee may delegate ministerial,
non-discretionary functions to individuals who are officers or employees of the
Company.
1.3 Participation.
Awards may be granted by the Committee only to those persons
that the Committee determines to be Eligible Employees. An Eligible Employee who
has been granted an Award may, if otherwise eligible, be granted additional
Awards if the Committee shall so determine. Non-Employee Directors shall not be
eligible to receive any Awards.
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1.4 Shares Available for Awards.
Subject to the provisions of Section 6.2, the capital stock
that may be delivered under this Plan shall be shares of the Corporation's
authorized but unissued Common Stock. The shares may be delivered for any lawful
consideration.
(a) Number of Shares. The maximum number of shares of Common Stock
that may be delivered pursuant to Awards granted to Eligible Employees under
this Plan shall not exceed __________ shares. The maximum number of shares
subject to those options and stock appreciation rights that during any calendar
year are granted to any individual shall be limited to __________ and the
maximum number of shares in the aggregate subject to all Awards that during any
calendar year are granted to any individual under this Plan shall be __________.
Each of the three foregoing numerical limits shall be subject to adjustment as
contemplated by this Section 1.4 and Section 6.2.
(b) Calculation of Available Shares and Replenishment. Shares
subject to outstanding Awards of derivative securities (as defined in Rule
16a-1(c) under the Exchange Act) shall be reserved for issuance. If any Option
or other right to acquire shares of Common Stock under or receive cash or shares
in respect of an Award shall expire or be cancelled or terminated without having
been exercised or paid in full, or any Common Stock subject to a Restricted
Stock Award or other Award shall not vest or be delivered, the unpurchased,
unvested or undelivered shares of Common Stock subject thereto shall again be
available for the purposes of this Plan, subject only to any applicable
limitations under Section 162(m) of the Code. If the Corporation withholds
shares of Common Stock pursuant to Section 6.5, the number of shares that would
have been deliverable with respect to an Award but that are withheld pursuant to
the provisions of Section 6.5 may in effect not be issued, but the aggregate
number of shares issuable with respect to the applicable Award and under this
Plan shall be reduced by the number of shares withheld and such shares shall not
be available for additional Awards under this Plan. Subject only to the
preceding sentence, Section 1.4(c) and Section 6.10(c), (1) Awards payable
solely in cash, and Awards that do not constitute equity securities as defined
in Rule 16a-1(d), shall not reduce the number of shares available for Awards
under this Plan, (2) any imputed charges to the maximum number of shares
deliverable under this Plan (through reserves or otherwise) shall be reversed in
the case of Awards actually paid in cash, and (3), to the extent any shares were
previously reserved in respect of Awards payable in cash or shares, the number
of shares not delivered shall again be available for purposes of this Plan.
(c) Provisions for Certain Cash Awards. The number of awards
payable solely in cash or actually paid in cash ("Cash Awards") shall be
determined by reference to the number of shares by which the value or price of
the Award is measured and shall not, together with the aggregate number of
shares theretofore delivered and subject to then outstanding Awards payable in
shares (or alternatively payable in cash or shares) under this Plan, exceed the
aggregate or individual limits of Section 1.4(a), subject to adjustments under
this Section 1.4 and Section 6.2. Cash Awards that are forfeited or
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for any reason are not paid in cash under this Plan may again, subject to
Section 6.10(c), be the subject of and available for subsequent Awards under the
Plan. If an Award satisfies the requirements for an exclusion from the
definition of derivative security under Rule 16a-1(c) that does not require that
the Award be made under a Rule 16b-3 plan and is not intended to constitute a
performance-based award for purposes of Section 162(m) of the Code, such Award
need not be counted against the limits under Section 1.4(a), (b) or (c).
1.5 Grant of Awards.
Subject to the express provisions of this Plan, the Committee
has the authority to determine those individuals who are Eligible Employees,
whether any of them will receive an Award and, if so, the type of Award, the
number of shares of Common Stock subject to each Award, the price (if any) to be
paid for the shares or the Award, the other terms of the Award, and, in the case
of Performance Share Awards, in addition to the matters addressed in Section
1.2(b), the specific objectives, goals and performance criteria (such as an
increase in sales, market value, earnings or book value over a base period, the
years of service before vesting, the relevant job classification or level of
responsibility or other factors) that further define the terms of the
Performance Share Award. Each Award shall be evidenced by an Award Agreement
signed by the Corporation and, if required by the Committee, by the Participant.
The Award Agreement shall set forth the material terms and conditions of the
Award established by the Committee consistent with the specific provisions of
this Plan.
1.6 Award Period.
Each Award and all executory rights or obligations under the
related Award Agreement shall expire on such date (if any) as shall be
determined by the Committee, but in the case of Options, stock appreciation
rights ("SARs") or other rights to acquire Common Stock not later than ten (10)
years after the Award Date.
1.7 Limitations on Exercise and Vesting of Awards.
(a) Provisions for Exercise. Unless the Committee otherwise
expressly provides in the applicable Award Agreement, no Award shall be
exercisable or shall vest until at least six months after the initial Award
Date, and once exercisable an Award shall remain exercisable until the
expiration or earlier termination of the Award.
(b) Procedure. Any exercisable Award shall be deemed to be
exercised when the Corporation receives written notice of such exercise from the
Participant, together with any required payment in accordance with Sections 2.2
and 6.5.
(c) Fractional Shares/Minimum Issue. Fractional share interests
shall be disregarded, but may be accumulated. The Committee, however, may
determine in the case of Eligible Employees that cash, other securities, or
other property will be paid or
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transferred in lieu of any fractional share interests. No fewer than 100 shares
may be purchased on exercise of any Award at one time unless the number
purchased is the total number at the time available for purchase under the
Award.
1.8 Acceptance of Notes to Finance Exercise.
The Corporation may, with the Committee's approval, accept one
or more notes from any Eligible Employee in connection with the exercise or
receipt of any outstanding Award; provided that any such note shall be subject
to the following terms and conditions:
(a) The principal of the note shall not exceed the amount required
to be paid to the Corporation upon the exercise or receipt of one or more Awards
under this Plan and the note shall be delivered directly to the Corporation in
consideration of such exercise or receipt.
(b) The initial term of the note shall be determined by the
Committee; provided that the term of the note, including extensions, shall not
exceed a period of 10 years.
(c) The note shall bear interest at a rate determined by the
Committee but not less than the interest rate necessary to avoid the imputation
of interest under the Code.
(d) If the employment of the Participant terminates, the unpaid
principal balance of the note shall become due and payable on the 10th business
day after such termination; provided, however, that if a sale of such shares
would cause such Participant to incur liability under Section 16(b) of the
Exchange Act, the unpaid balance shall become due and payable on the 10th
business day after the first day on which a sale of such shares could have been
made without incurring such liability assuming for these purposes that there are
no other transactions (or deemed transactions in securities of this Corporation)
by the Participant subsequent to such termination.
(e) If required by the Committee or by applicable law, the note
shall be secured by a pledge of any shares or rights financed thereby in
compliance with applicable law.
(f) The terms, repayment provisions, and collateral release
provisions of the note and the pledge securing the note shall conform with all
applicable laws.
1.9 No Transferability.
(a) Limit On Exercise and Transfer. Unless otherwise expressly
provided in (or pursuant to) this Section 1.9, by applicable law and by the
Award Agreement, as the same may be amended, (i) all Awards are non-transferable
and shall not be subject in any manner to sale, transfer, anticipation,
alienation, assignment, pledge, encumbrance or
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charge; Awards shall be exercised only by the Participant; and (ii) amounts
payable or shares issuable pursuant to an Award shall be delivered only to (or
for the account of) the Participant.
(b) Exceptions. The Committee may permit Awards to be exercised by
and paid only to certain persons or entities related to the Participant,
including but not limited to members of the Participant's immediate family,
charitable institutions, or trusts or other entities whose beneficiaries or
beneficial owners are members of the Participant's immediate family and/or
charitable institutions, or to such other persons or entities as may be approved
by the Committee, pursuant to such conditions and procedures as the Committee
may establish. Any permitted transfer shall be subject to the condition that the
Committee receive evidence satisfactory to it that the transfer is being made
for estate and/or tax planning purposes on a gratuitous or donative basis and
without consideration (other than nominal consideration). Notwithstanding the
foregoing, Incentive Stock Options and Restricted Stock Awards shall be subject
to any and all additional transfer restrictions under the Code.
(c) Further Exceptions to Limits On Transfer. The exercise and
transfer restrictions in Section 1.9(a) shall not apply to:
(i) transfers to the Corporation,
(ii) the designation of a beneficiary to receive benefits in
the event of the Participant's death or, if the Participant has died,
transfers to or exercise by the Participant's beneficiary, or, in the
absence of a validly designated beneficiary, transfers by will or the
laws of descent and distribution,
(iii) transfers pursuant to a QDRO order if approved or
ratified by the Committee,
(iv) if the Participant has suffered a disability, permitted
transfers or exercises on behalf of the Participant by his or her
legal representative, or
(v) the authorization by the Committee of "cashless exercise"
procedures with third parties who provide financing for the purpose of
(or who otherwise facilitate) the exercise of Awards consistent with
applicable laws and the express authorization of the Committee.
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II. EMPLOYEE OPTIONS
2.1 Grants.
One or more Options may be granted under this Article to any
Eligible Employee. Each Option granted shall be designated by the Committee in
the applicable Award Agreement as either a Nonqualified Stock Option or an
Incentive Stock Option.
2.2 Option Price.
(a) Pricing Limits. The purchase price per share of the Common
Stock covered by each Option shall be determined by the Committee at the time of
the Award, but in the case of Incentive Stock Options shall not be less than
100% (110% in the case of a Participant described in Section 2.4) of the Fair
Market Value of the Common Stock on the date of grant.
(b) Payment Provisions. The purchase price of any shares purchased
on exercise of an Option granted under this Article shall be paid in full at the
time of each purchase in one or a combination of the following methods: (i) in
cash or by electronic funds transfer; (ii) by certified or cashier's check
payable to the order of the Corporation; (iii) if authorized by the Committee or
specified in the applicable Award Agreement, by a promissory note of the
Participant consistent with the requirements of Section 1.8; or (iv) by the
delivery of shares of Common Stock of the Corporation already owned by the
Participant, provided, however, that the Committee may in its absolute
discretion limit the Participant's ability to exercise an Award by delivering
such shares, and provided further that any shares delivered which were initially
acquired upon exercise of a stock option must have been owned by the Participant
at least six months as of the date of delivery. Shares of Common Stock used to
satisfy the exercise price of an Option shall be valued at their Fair Market
Value on the date of exercise. In addition to the payment methods described
above, the Committee may provide that the Option can be exercised and payment
made by delivering a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Corporation the amount of
sale proceeds necessary to pay the exercise price and, unless otherwise allowed
by the Committee, any applicable tax withholding under Section 6.5. The
Corporation shall not be obligated to deliver certificates for the shares unless
and until it receives full payment of the exercise price therefor and any
related withholding obligations have been satisfied.
2.3 Limitations on Grant and Terms of Incentive Stock Options.
(a) $100,000 Limit. To the extent that the aggregate Fair Market
Value of stock with respect to which incentive stock options first become
exercisable by a Participant in any calendar year exceeds $100,000, taking into
account both Common Stock subject to Incentive Stock Options under this Plan and
stock subject to incentive stock options under all other plans of the Company or
any parent corporation, such
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options shall be treated as nonqualified stock options. For this purpose, the
Fair Market Value of the stock subject to options shall be determined as of the
date the options were awarded. In reducing the number of options treated as
incentive stock options to meet the $100,000 limit, the most recently granted
options shall be reduced first. To the extent a reduction of simultaneously
granted options is necessary to meet the $100,000 limit, the Committee may, in
the manner and to the extent permitted by law, designate which shares of Common
Stock are to be treated as shares acquired pursuant to the exercise of an
Incentive Stock Option.
(b) Option Period. Each Option and all rights thereunder shall
expire no later than ten years after the Award Date or at such earlier time as
provided in or pursuant to Section 6.3.
(c) Other Code Limits. There shall be imposed in any Award
Agreement relating to Incentive Stock Options such terms and conditions as from
time to time are required in order that the Option be an "incentive stock
option" as that term is defined in Section 422 of the Code.
(d) Optionee Notice Requirement. A holder of shares of Common
Stock acquired upon exercise of an Incentive Stock Option shall give written
notice to the Company of the disposition of the shares within two years of the
Award Date or one year of the date of exercise.
2.4 Limits on 10% Holders.
No Incentive Stock Option may be granted to any person who, at
the time the Option is granted, owns (or is deemed to own under Section 424(d)
of the Code) shares of outstanding Common Stock possessing more than 10% of the
total combined voting power of all classes of stock of the Corporation, unless
the exercise price of such Option is at least 110% of the Fair Market Value of
the stock subject to the Option and such Option by its terms is not exercisable
after the expiration of five years from the date such Option is granted.
2.5 Option Repricing/Cancellation and Regrant/Waiver of
Restrictions.
Subject to Section 1.4 and Section 6.6 and the specific
limitations on Awards contained in this Plan, the Committee from time to time
may authorize, generally or in specific cases only, for the benefit of any
Eligible Employee any adjustment in the exercise or purchase price, the vesting
schedule, the number of shares subject to, the restrictions upon or the term of,
an Award granted under this Article by cancellation of an outstanding Award and
a subsequent regranting of an Award, by amendment, by substitution of an
outstanding Award, by waiver or by other legally valid means. Such amendment or
other action may result, among other changes, in an exercise or purchase price
which is higher or lower than the exercise or purchase price of
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the original or prior Award, provide for a greater or lesser number of shares
subject to the Award, or provide for a longer or shorter vesting or exercise
period.
2.6 Options and Rights in Substitution for Stock Options Granted
by Other Corporations.
Options and Stock Appreciation Rights may be granted to
Eligible Employees under this Plan in substitution for employee stock options
granted by other entities to persons who are or who become employees of the
Company, in connection with a distribution, merger or reorganization by or with
the granting entity or an affiliated entity, or the acquisition by the Company,
directly or indirectly, of all or a substantial part of the stock or assets of
the employing entity.
III. STOCK APPRECIATION RIGHTS.
3.1 Grants.
In its discretion, the Committee may grant to any Eligible
Employee SARs concurrently with the grant of Options or other Awards or in
respect of an outstanding Award, in whole or in part, or independently of any
other Award, all on such terms as set forth by the Committee in the Award
Agreement. Any SAR granted in connection with an Incentive Stock Option shall
contain such terms as may be required to comply with the provisions of Section
422 of the Code and the regulations promulgated thereunder, unless the holder
otherwise agrees.
3.2 Exercise of SARs.
(a) Exercisability. An SAR granted independently of any other
Award shall be exercisable pursuant to the terms of the Award Agreement. Unless
the Award Agreement or the Committee otherwise provides, an SAR related to
another Award shall be exercisable at such time or times, and to the extent,
that the related Award shall be exercisable and only when the Fair Market Value
of the stock subject to the related Award exceeds the base price of the SAR.
(b) Effect on Available Shares. To the extent that a SAR is exercised,
the number of shares of Common Stock subject to any related Award shall be
charged against the maximum amount of Common Stock that may be delivered
pursuant to Awards under this Plan. The number of shares subject to the SAR and
the related Award of the Participant shall also be reduced by such number of
shares, unless the Award Agreement otherwise provides.
(c) Proportionate Reduction. If an SAR extends to less than all
the shares covered by the related Award and if a portion of the related Award is
thereafter exercised, the number of shares subject to the unexercised SAR shall
be reduced only if
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and to the extent that the remaining number of shares covered by such related
Award is less than the remaining number of shares subject to the SAR.
3.3 Payment.
(a) Amount. Unless the Committee otherwise provides in the
applicable Award Agreement, upon exercise of an SAR and surrender of an
exercisable portion of any related Award (to the extent required by Section
3.2), the Participant shall be entitled to receive, subject to Section 6.5,
payment of an amount determined by multiplying
(i) the difference obtained by subtracting the base price per
share of Common Stock under the SAR from the Fair Market Value of a
share of Common Stock on the date of exercise of the SAR, by
(ii) the number of shares with respect to which the SAR
shall have been exercised.
(b) Form of Payment. The Committee, in its sole discretion, shall
determine the form in which payment shall be made of the amount determined under
paragraph (a) above, either solely in cash, solely in shares of Common Stock
(valued at Fair Market Value on the date of exercise of the SAR), or partly in
such shares and partly in cash, provided that the Committee shall have
determined that such exercise and payment are consistent with applicable law. If
the Committee permits the Participant to elect to receive cash or shares (or a
combination thereof) on such exercise, any such election shall be subject to
such conditions as the Committee may impose.
3.4 Limited SARs.
The Committee may grant to any Eligible Employee SARs
exercisable only upon or in respect of a change in control or any other
specified event ("Limited SARs") and such Limited SARs may relate to or operate
in tandem or combination with or substitution for Options, other SARs or other
Awards (or any combination thereof), and may be payable in cash or shares based
on the spread between the base price of the SAR and a price based upon the Fair
Market Value of the Shares during a specified period or at a specified time
within a specified period before, after or including the date of such event.
IV. RESTRICTED STOCK AWARDS.
4.1 Grants.
The Committee may, in its discretion, grant one or more
Restricted Stock Awards to any Eligible Employee. Each Restricted Stock Award
Agreement shall specify
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the number of shares of Common Stock to be issued to the Participant, the date
of such issuance, the consideration for such shares (but not less than the
minimum lawful consideration under applicable state law) by the Participant, the
extent (if any) to which and the time (if ever) at which the Participant shall
be entitled to dividends, voting and other rights in respect of the shares prior
to vesting, and the restrictions (which may be based on performance criteria,
passage of time or other factors or any combination thereof) imposed on such
shares and the conditions of release or lapse of such restrictions. Such
restrictions shall not lapse earlier than one year after the Award Date, except
to the extent the Committee may otherwise provide in the applicable Award
Agreement. Stock certificates evidencing shares of Restricted Stock pending the
lapse of the restrictions ("Restricted Shares") shall bear a legend making the
appropriate reference to the restrictions imposed hereunder and shall be held by
the Corporation or by a third party designated by the Committee until the
restrictions on such shares shall have lapsed and the shares shall have vested
in accordance with the provisions of the Award and Section 1.7(a). Upon issuance
of the Restricted Stock Award, the Participant may be required to provide such
further assurance and documents as the Committee may require to enforce the
restrictions.
4.2 Restrictions.
(a) Pre-Vesting Restraints. Except as provided in Section 4.1 and
1.9, restricted shares comprising any Restricted Stock Award may not be sold,
assigned, transferred, pledged or otherwise disposed of or encumbered, either
voluntarily or involuntarily, until the restrictions on such shares have lapsed
and the shares become vested.
(b) Dividend and Voting Rights. Unless otherwise provided in the
applicable Award Agreement, the holder of a Restricted Stock Award shall not be
entitled to receive dividends on any of the shares of Restricted Stock until the
shares vest. Dividends so restricted shall be retained in a restricted account
until the shares have vested and shall revert to the Corporation if they fail to
vest. Holders of Restricted Stock shall be entitled to vote (or instruct voting)
prior to vesting.
(c) Cash Payments. If the Participant shall have paid or received
cash (including any dividends) or other property in connection with the
Restricted Stock Award, the Award Agreement shall specify whether and to what
extent such cash or other property shall be returned (with or without an
earnings factor) as to shares of Restricted Stock which do not vest.
4.3 Return to the Corporation.
Unless the Committee otherwise expressly provides, shares of
Restricted Stock that are subject to restrictions at the time of termination of
employment or are subject to other conditions to vesting that have not been
satisfied by the time specified in
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the applicable Award Agreement shall not vest and shall be returned to the
Corporation in such manner and on such terms as the Committee shall therein
provide.
V. PERFORMANCE SHARE AWARDS AND STOCK BONUSES.
5.1 Grants of Performance Share Awards.
The Committee may, in its discretion, grant Performance Share
Awards to Eligible Employees based upon such factors as the Committee shall deem
relevant in light of the specific type and terms of the award. An Award
Agreement shall specify the maximum number of shares of Common Stock (if any)
subject to the Performance Share Award, the consideration (but not less than the
minimum lawful consideration) to be paid for any such shares as may be issuable
to the Participant, the duration of the Award and the conditions upon which
delivery of any shares or cash to the Participant shall be based. The amount of
cash or shares or other property that may be deliverable pursuant to such Award
shall be based upon the degree of attainment over a specified period of not more
than ten years (a "performance cycle") as may be established by the Committee of
such measure(s) of the performance of the Company (or any part thereof) or the
Participant as may be established by the Committee. The Committee may provide
for full or partial credit, prior to completion of such performance cycle or the
attainment of the performance achievement specified in the Award, in the event
of the Participant's death, Retirement, or Total Disability, a Change in Control
Event or in such other circumstances as the Committee (consistent with Section
6.10(c)(2), if applicable) may determine.
5.2 Grants of Stock Bonuses.
The Committee may grant a Stock Bonus to any Eligible Employee
to reward exceptional or special services, contributions or achievements in the
manner and on such terms and conditions (including any restrictions on such
shares) as determined from time to time by the Committee. The number of shares
so awarded shall be determined by the Committee. The Award may be granted
independently or in lieu of a cash bonus.
5.3 Deferred Payments.
The Committee may authorize for the benefit of any Eligible
Employee the deferral of any payment of cash or shares that may become due or of
cash otherwise payable under this Plan, and provide for accreted benefits
thereon based upon such deferment, at the election or at the request of such
Participant, subject to the other terms of this Plan. Such deferment shall be
subject to such further conditions, restrictions or requirements as the
Committee may impose, subject to any then vested rights of Participants.
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5.4 Special Performance-Based Share Awards
Without limiting the generality of the foregoing, and in
addition to awards granted under other provisions of this Plan, other
performance-based awards within the meaning of Section 162(m) of the Code
("Performance-Based Awards"), whether in the form of restricted stock,
performance stock, phantom stock or other rights, the vesting of which depends
on the performance of the Company on a consolidated, segment, subsidiary or
division basis with reference to revenues, net earnings (before or after taxes
or before or after taxes, interest, depreciation, and/or amortization), cash
flow, return on equity or on assets or on net investment, or cost containment or
reduction, or any combination thereof (the "business criteria") relative to
preestablished performance goals, may be granted under this Plan. The applicable
business criteria and specific performance goal or goals ("targets") must be
approved by the Committee in advance of applicable deadlines under the Code and
while the performance relating to such targets remains substantially uncertain.
The applicable performance measurement period may be not less than one nor more
than ten years. Performance targets may be adjusted to mitigate the unbudgeted
impact of material, unusual or nonrecurring gains and losses, accounting changes
or other extraordinary events not foreseen at the time the targets were set.
(a) Eligible Class. The eligible class of persons for Awards
under this Section 5.4 shall be executive officers of the Company.
(b) Maximum Award. In no event shall grants made in any fiscal
year to any eligible person under this Section 5.4 relate to more than _______
shares or, if payable in cash, a cash amount of more than $__________.
(c) Committee Certification. Before any Performance-Based Award
under this Section 5.4 is paid, the Committee must certify that the material
terms of the Performance-Based Award were satisfied.
(d) Terms and Conditions of Awards. The Committee will have
discretion to determine the restrictions or other limitations of the individual
Awards under this Section 5.4, including the authority to reduce Awards, payouts
or vesting or to pay no Awards, in its sole discretion, if the Committee
preserves such authority at the time of grant by language to this effect in its
authorizing resolutions, the applicable Award Agreement or otherwise.
(e) Stock Payout Features. In lieu of cash payment of an Award,
the Committee may require or allow a portion of the Award to be paid in the form
of stock, Restricted Shares or an Option.
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VI. OTHER PROVISIONS.
6.1 Rights of Eligible Employees, Participants and Beneficiaries.
(a) Employment Status. Status as an Eligible Employee shall not
be construed as a commitment that any Award will be made under this Plan to an
Eligible Employee or to Eligible Employees generally.
(b) No Employment Contract. Nothing contained in this Plan (or
in any other documents related to this Plan or to any Award) shall confer upon
any Eligible Employee or other Participant any right to continue in the employ
or other service of the Company or constitute any contract or agreement of
employment or other service, nor shall interfere in any way with the right of
the Company to change such person's compensation or other benefits or to
terminate the employment of such person, with or without cause, but nothing
contained in this Plan or any document related hereto shall adversely affect any
independent contractual right or duty of such person without the consent of the
party to be bound.
(c) Plan Not Funded. Awards payable under this Plan shall be
payable in shares or from the general assets of the Corporation, and (except as
provided in Section 1.4(b)), no special or separate reserve, fund or deposit
shall be made to assure payment of such Awards. No Participant, Beneficiary or
other person shall have any right, title or interest in any fund or in any
specific asset (including shares of Common Stock, except as expressly otherwise
provided) of the Company by reason of any Award hereunder. Neither the
provisions of this Plan (nor of any related documents), nor the creation or
adoption of this Plan, nor any action taken pursuant to the provisions of this
Plan shall create, or be construed to create, a trust of any kind or a fiduciary
relationship between the Company and any Participant, Beneficiary or other
person. To the extent that a Participant, Beneficiary or other person acquires a
right to receive payment pursuant to any Award hereunder, such right shall be no
greater than the right of any unsecured general creditor of the Company.
6.2 Adjustments; Acceleration.
(a) Adjustments. If there shall occur any extraordinary dividend
or other extraordinary distribution in respect of the Common Stock (whether in
the form of cash, Common Stock, other securities, or other property), or any
reclassification, recapitalization, stock split (including a stock split in the
form of a stock dividend), reverse stock split, reorganization, merger,
combination, consolidation, split-up, spin-off, combination, repurchase, or
exchange of Common Stock or other securities of the Corporation, or there shall
occur any similar extraordinary corporate transaction (or event in respect of
the Common Stock) or a sale of substantially all the assets of the Corporation
as an entirety, then the Committee shall, in such manner and to such extent (if
any) as it deems appropriate and equitable (1) proportionately adjust any or all
of (a) the number and type of shares of Common Stock (or other securities) which
thereafter may be made
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the subject of Awards (including the specific maxima and numbers of shares set
forth elsewhere in this Plan), (b) the number, amount and type of shares of
Common Stock (or other securities or property) subject to any or all outstanding
Awards, (c) the grant, purchase, or exercise price of any or all outstanding
Awards, (d) the securities, cash or other property deliverable upon exercise of
any outstanding Awards, and/or (e) the performance standards appropriate to any
outstanding Awards, or (2) in the case of an extraordinary dividend or other
distribution, recapitalization, reclassification, reorganization, merger,
consolidation, combination, sale of assets, split up, exchange, or spin off,
make provision for a cash payment or for the substitution or exchange of any or
all outstanding Awards (or the cash, securities or property deliverable to the
holder of any or all outstanding Awards) based upon the distribution or
consideration payable to holders of the Common Stock of the Corporation upon or
in respect of such event; provided, however, in each case, that with respect to
Awards of Incentive Stock Options, no such adjustment shall be made which would
cause the Plan to violate Section 424(a) of the Code or any successor provisions
thereto without the written consent of holders materially adversely affected
thereby. In any of such events, the Committee may take such action sufficiently
prior to such event if necessary to permit the Participant to realize the
benefits intended to be conveyed with respect to the underlying shares in the
same manner as is available to shareholders generally.
(b) Acceleration of Awards Upon Change in Control. Unless prior to
a Change in Control Event the Committee determines that, upon its occurrence,
there shall be no acceleration of benefits under Awards or determines that only
certain or limited benefits under Awards shall be accelerated and the extent to
which they shall be accelerated, and/or establishes a different time in respect
of such Event for such acceleration, then upon the occurrence of a Change in
Control Event
(i) each Option and SAR shall become immediately
exercisable,
(ii) Restricted Stock shall immediately vest free of
restrictions, and
(iii) the number of shares, cash or other property covered by
each Performance Share Award shall be issued or paid to the
Participant;
provided, however, that in no event shall any Award be accelerated as to any
Section 16 Person to a date less than six months after the Award Date of such
Award. The Committee may override the limitations on acceleration in this
Section 6.2(b) by express provision in the Award Agreement and may accord any
Eligible Employee a right to refuse any acceleration, whether pursuant to the
Award Agreement or otherwise, in such circumstances as the Committee may
approve. Any acceleration of Awards shall comply with applicable regulatory
requirements, including without limitation, Section 422 of the Code.
(c) Possible Early Termination of Accelerated Awards. If any
Option or other right to acquire Common Stock under this Plan has been fully
accelerated as permitted
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by Section 6.2(b), the holder thereof has been accorded an opportunity to
exercise or otherwise realize the benefits thereof and the Option or other right
is not exercised prior to (i) a dissolution of the Corporation, or (ii) an event
described in Section 6.2(a) that the Corporation does not survive, or (iii) the
consummation of an event described in Section 6.2(a) that results in a Change of
Control approved by the Board, the Option or right shall thereupon terminate,
subject to any provision that has been expressly made by the Committee for the
survival, substitution, exchange or other settlement of the Option or right.
6.3 Termination of Service; Termination of Subsidiary Status;
Discretionary Provisions.
(a) Options/SAR - Resignation or Dismissal. Unless the Committee
otherwise provides in the applicable Award Agreement, if the Participant's
employment by or service to the Company terminates for any reason other than
Retirement, Total Disability or death, the Participant shall have, subject to
earlier termination pursuant to or as contemplated by Section 1.6 or 6.2, three
months from the date of termination to exercise any Option to the extent it
shall have become exercisable on the date of termination, and any Option to the
extent not exercisable on that date shall terminate.
(b) Options/SAR - Retirement, Death or Disability. Unless the
Committee otherwise provides in the applicable Award Agreement, and except for
limitations under the Code in respect of Incentive Stock Options, if the
Participant's employment by or service to the Company terminates as a result of
Retirement, Total Disability or death, the Participant, Participant's Personal
Representative or his or her Beneficiary, as the case may be, shall have,
subject to earlier termination pursuant to or as contemplated by Section 1.6, 12
months from the date of termination to exercise any Option or SAR to the extent
it shall have become exercisable by the date of termination, and any Option or
SAR to the extent not exercisable on that date shall terminate.
(c) Certain SARs. Each SAR granted concurrently or in tandem with
an Option shall have the same post-termination provisions and exercisability
periods as the Option to which it relates, unless the Committee otherwise
provides.
(d) Other Awards. The Committee shall establish in respect of each
other Award granted hereunder the Participant's rights and benefits (if any) in
the event of a termination of employment or service and in so doing may make
distinctions based upon the cause of termination and the nature of the Award.
(e) Change in Subsidiary Status/Change in Service. For purposes of
this Plan and any Award hereunder, if an entity ceases to be a Subsidiary, a
termination of employment shall be deemed to have occurred with respect to each
employee of such Subsidiary who does not continue as an employee of another
entity owned, controlled by or under common control with the Company. In the
case of Awards to or held by an
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Other Eligible Person, the Committee shall determine the applicable service
requirements and the effect of a change in the extent, status or terms of
service.
(f) Committee Discretion. Notwithstanding the foregoing provisions
of this Section 6.3, in the event of, or in anticipation of, a termination of
employment or service with the Company for any reason, other than discharge for
cause, the Committee may, in its discretion, increase the portion of the
Participant's Award available to the Participant, or Participant's Beneficiary
or Personal Representative, as the case may be, or, subject to the provisions of
Section 1.6, extend the exercisability period upon such terms as the Committee
shall determine and expressly set forth in or by amendment to the Award
Agreement.
6.4 Compliance With Laws.
This Plan, the granting and vesting of Awards under this Plan
and the offer, issuance and delivery of shares of Common Stock and/or the
payment of money under this Plan or under Awards granted hereunder are subject
to compliance with all applicable federal and state laws, rules and regulations
(including but not limited to state and federal securities law and federal
margin requirements) and to such approvals by any listing, agency or any
regulatory or governmental authority as may, in the opinion of counsel for the
Corporation, be necessary or advisable in connection therewith. Any securities
delivered under this Plan shall be subject to such restrictions, and the person
acquiring such securities shall, if requested by the Corporation, provide such
assurances and representations to the Corporation as the Corporation may deem
necessary or desirable to assure compliance with all applicable legal
requirements.
6.5 Tax Withholding.
Upon any exercise, vesting, or payment of any Award (or upon
the disposition of shares of Common Stock acquired pursuant to the exercise of
an Incentive Stock Option prior to satisfaction of the holding period
requirements of Section 422 of the Code), the Company shall have the right at
its option to (i) require the Participant (or Personal Representative or
Beneficiary, as the case may be) to pay or provide for payment of the amount of
any taxes which the Company may be required to withhold with respect to such
Award event or payment or (ii) deduct from any amount payable the amount of any
taxes which the Company may be required to withhold with respect to such cash
payment. In any case where a tax is required to be withheld in connection with
the delivery of shares of Common Stock under this Plan, the Committee may in its
sole discretion grant (either at the time of the Award or thereafter) to the
Participant the right to elect, pursuant to such rules and subject to such
conditions as the Committee may establish, to have the Corporation reduce the
number of shares to be delivered by (or otherwise reacquire) the appropriate
number of shares valued at their then Fair Market Value, to satisfy such
withholding obligation.
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6.6 Plan Amendment, Termination and Suspension.
(a) Board or Committee Authorization. The Board may, at any time,
terminate or, from time to time, amend, modify or suspend this Plan, in whole or
in part. No Awards may be granted during any suspension of this Plan or after
termination of this Plan, but the Committee shall retain jurisdiction as to
Awards then outstanding in accordance with the terms of this Plan.
(b) Shareholder Approval. Any amendment that would (i) materially
increase the benefits accruing to Participants under this Plan, (ii) materially
increase the aggregate number of securities that may be issued under this Plan,
or (iii) materially modify the requirements as to eligibility for participation
in this Plan, shall be subject to shareholder approval only to the extent then
required by Section 425 of the Code or applicable law, or deemed necessary or
advisable by the Board.
(c) Amendments to Awards. Without limiting any other express
authority of the Committee under, but subject to the express limits, of this
Plan, the Committee by agreement or resolution may waive conditions of or
limitations on Awards to Eligible Employees that the Committee in the prior
exercise of its discretion has imposed, without the consent of a Participant,
and may make other changes to the terms and conditions of Awards that do not
affect, in any manner materially adverse to the Employee Participant, his or her
rights and benefits under an Award.
(d) Limitations on Amendments to Plan and Awards. No amendment,
suspension or termination of this Plan or change of or affecting any outstanding
Award shall, without written consent of the Participant, affect in any manner
materially adverse to the Participant any rights or benefits of the Participant
or obligations of the Corporation under any Award granted under this Plan prior
to the effective date of such change. Changes contemplated by Section 6.2 shall
not be deemed to constitute changes or amendments for purposes of this Section
6.6.
6.7 Privileges of Stock Ownership.
Except as otherwise expressly authorized by the Committee or
this Plan, a Participant shall not be entitled to any privilege of stock
ownership as to any shares of Common Stock not actually delivered to and held of
record by him or her. No adjustment will be made for dividends or other rights
as a shareholders for which a record date is prior to such date of delivery.
6.8 Effective Date of this Plan.
This Plan shall be effective as of the date it is approved by
the Board, subject to approval of the shareholders of the Corporation within 12
months thereafter.
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6.9 Term of this Plan.
No Award shall be granted under this Plan after __________,
2006 (the "termination date"). Unless otherwise expressly provided in this Plan
or in an applicable Award Agreement, any Award granted prior to the termination
date may extend beyond such date, and all authority of the Committee with
respect to Awards hereunder, including the authority to amend an Award, shall
continue during any suspension of this Plan and shall continue in respect of
Awards outstanding on the termination date.
6.10 Governing Law/Construction/Severability.
(a) Choice of Law. This Plan, the Awards, all documents evidencing
Awards and all other related documents shall be governed by, and construed in
accordance with the laws of the State of California.
(b) Severability. If any provision shall be held by a court of
competent jurisdiction to be invalid and unenforceable, the remaining provisions
of this Plan shall continue in effect.
(c) Plan Construction.
(1) Rule 16b-3. It is the intent of the Corporation that
transactions in and affecting Awards in the case of Participants who
are or may be subject to Section 16 of the Exchange Act satisfy any
then applicable requirements of Rule 16b-3 so that such persons (unless
they otherwise agree) will be entitled to the benefits of Rule 16b-3 or
other exemptive rules under Section 16 of the Exchange Act in respect
of those transactions and will not be subjected to avoidable liability
thereunder. If any provision of this Plan or of any Award would
otherwise frustrate or conflict with the intent expressed above, that
provision to the extent possible shall be interpreted as to avoid such
conflict. If the conflict remains irreconcilable, the Committee may
disregard the provision if it concludes that to do so furthers the
interest of the Corporation and is consistent with the purposes of this
Plan as to such persons in the circumstances.
(2) Section 162(m). It is the further intent of the Company
that Options or SARs with an exercise or base price not less than Fair
Market Value on the date of grant and performance awards under Section
5.4 of this Plan that are granted to or held by a Section 16 Person
shall qualify as performance-based compensation under Section 162(m) of
the Code, and this Plan shall be interpreted consistent with such
intent.
6.11 Captions.
Captions and headings are given to the sections and
subsections of this Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed
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in any way material or relevant to the construction or interpretation of this
Plan or any provision thereof.
6.12 Non-Exclusivity of Plan.
Nothing in this Plan shall limit or be deemed to limit the
authority of the Board or the Committee to grant awards or authorize any other
compensation, with or without reference to the Common Stock, under any other
plan or authority.
VII. DEFINITIONS.
7.1 Definitions.
(a) "Award" shall mean an award of any Option, SAR, Restricted
Stock, Stock Bonus, Performance-Based Award or other Performance Share Award,
dividend equivalent or deferred payment right or other right or security that
would constitute a "derivative security" under Rule 16a-1(c) of the Exchange
Act, or any combination thereof, whether alternative or cumulative, authorized
by and granted under this Plan.
(b) "Award Agreement" shall mean any writing setting forth the
terms of an Award that has been authorized by the Committee.
(c) "Award Date" shall mean the date upon which the Committee took
the action granting an Award or such later date as the Committee designates as
the Award Date.
(d) "Award Period" shall mean the period beginning on an Award
Date and ending on the expiration date of such Award.
(e) "Beneficiary" shall mean the person, persons, trust or trusts
designated by a Participant or, in the absence of a designation, entitled by
will or the laws of descent and distribution, to receive the benefits specified
in the Award Agreement and under this Plan in the event of a Participant's
death, and shall mean the Participant's executor or administrator if no other
Beneficiary is designated and able to act under the circumstances.
(f) "Board" shall mean the Board of Directors of the Corporation.
(g) "Change in Control Event" shall mean any of the following:
(1) Approval by the shareholders of the Corporation of the
dissolution or liquidation of the Corporation;
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(2) Approval by the shareholders of the Corporation of an
agreement to merge or consolidate, or otherwise reorganize, with or
into one or more entities that are not Subsidiaries, as a result of
which less than 50% of the outstanding voting securities of the
surviving or resulting entity immediately after the reorganization are,
or will be, owned, directly or indirectly, by shareholders of the
Corporation immediately before such reorganization (assuming for
purposes of such determination that there is no change in the record
ownership of the Corporation's securities from the record date for such
approval until such reorganization and that such record owners hold no
securities of the other parties to such reorganization, but including
in such determination any securities of the other parties to such
reorganization held by affiliates of the Corporation);
(3) Approval by the shareholders of the Corporation of the
sale, lease, conveyance or other disposition of all or substantially
all of the Corporation's business and/or assets to a person or entity
which is not a Subsidiary;
(4) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act but excluding any person described in and
satisfying the conditions of Rule 13d-1(b)(1) thereunder), other than a
person who is the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of more than 20% of the outstanding Shares of Common
Stock at the time of adoption of this Plan (or an affiliate, successor,
heir, descendant or related party of or to any such person), becomes
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act)
directly or indirectly, of securities of the Corporation representing
more than 25% of the combined voting power of the Corporation's then
outstanding securities entitled to then vote generally in the election
of directors of the Corporation; or
(5) A majority of the Board of Directors of the Company not
being comprised of Continuing Directors. For purposes of this clause,
"Continuing Directors" are persons who were (A) members of the Board of
Directors of the Company at the time of adoption of this Plan or (B)
nominated for election or elected to the Board of Directors of the
Company with the affirmative vote of at least a majority of the
directors who were Continuing Directors at the time of such nomination
or election.
(h) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
(i) "Commission" shall mean the Securities and Exchange
Commission.
(j) "Committee" shall mean the Board or a committee appointed by
the Board to administer this Plan, which committee shall be comprised only of
two or more directors or such greater number of directors as may be required
under applicable law,
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each of whom, in respect of any decision at a time when the Participant affected
by the decision may be subject to Section 162(m) of the Code, shall be
Disinterested.
(k) "Common Stock" shall mean the Common Stock of the Corporation
and such other securities or property as may become the subject of Awards, or
become subject to Awards, pursuant to an adjustment made under Section 6.2 of
this Plan.
(l) "Company" shall mean, collectively, the Corporation and its
Subsidiaries.
(m) "Corporation" shall mean International Aircraft Investors, a
California corporation, and its successors.
(n) "Disinterested" shall mean a disinterested director or an
"outside director" within the meaning of any mandatory legal or regulatory
requirements, including Section 162(m) of the Code.
(o) "Eligible Employee" shall mean an officer (whether or not a
director) or key employee of the Company, or any Other Eligible Person, as
determined by the Committee in its discretion.
(p) "ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
(q) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time.
(r) "Fair Market Value" on any date shall mean (i) if the stock is
listed or admitted to trade on a national securities exchange, the closing price
of the stock on the Composite Tape, as published in the Western Edition of The
Wall Street Journal, of the principal national securities exchange on which the
stock is so listed or admitted to trade, on such date, or, if there is no
trading of the stock on such date, then the closing price of the stock as quoted
on such Composite Tape on the next preceding date on which there was trading in
such shares; (ii) if the stock is not listed or admitted to trade on a national
securities exchange, the last price for the stock on such 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; (iii) if the stock is not listed or admitted
to trade on a national securities exchange and is not reported on the National
Market Reporting System, the mean between the bid and asked price for the stock
on such date, as furnished by the NASD or a similar organization; or (iv) if the
stock is not listed or admitted to trade on a national securities exchange, is
not 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 Committee at such time for purposes of this Plan.
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(s) "Incentive Stock Option" shall mean an Option which is
designated and intended as an incentive stock option within the meaning of
Section 422 of the Code, the award of which contains such provisions (including
but not limited to the receipt of shareholder approval of this Plan, if the
award is made prior to such approval) and is made under such circumstances and
to such persons as may be necessary to comply with that section.
(t) "Nonqualified Stock Option" shall mean an Option that is
designated as a Nonqualified Stock Option and shall include any Option intended
as an Incentive Stock Option that fails to meet the applicable legal
requirements thereof. Any Option granted hereunder that is not designated as an
incentive stock option shall be deemed to be designated a nonqualified stock
option under this Plan and not an incentive stock option under the Code.
(u) "Non-Employee Director" shall mean a member of the Board of
Directors of the Corporation who is not an officer or employee of the Company.
(v) "Option" shall mean an option to purchase Common Stock under
this Plan. The Committee shall designate any Option granted to an Eligible
Employee as a Nonqualified Stock Option or an Incentive Stock Option.
(w) "Other Eligible Person" shall mean any individual consultant
or advisor, or (to the extent provided in the next sentence) agent, who (A)
renders or has rendered bona fide services (other than services in connection
with the offering or sale of securities of the Company in a capital raising
transaction) to the Company, and (B) is selected to participate in this Plan by
the Committee. A non-employee agent providing bona fide services to the Company
(other than as an eligible advisor or consultant) may also be selected as an
Other Eligible Person if such agent's participation in this Plan would not
adversely affect (x) the Corporation's eligibility to use Form S-8 to register
under the Securities Act the offer and sale by the Company of shares issuable
under this Plan or (y) the Corporation's compliance with any other applicable
laws.
(x) "Participant" shall mean an Eligible Employee who has been
granted an Award under this Plan.
(y) "Performance Share Award" shall mean an award of a right to
receive shares of Common Stock under Section 5.1, or to receive shares of Common
Stock or other compensation (including cash) under Section 5.4, the issuance or
payment of which is contingent upon, among other conditions, the attainment of
performance objectives specified by the Committee.
(z) "Personal Representative" shall mean the person or persons
who, upon the disability or incompetence of a Participant, shall have acquired
on behalf of the Participant, by legal proceeding or otherwise, the power to
exercise the rights or receive
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benefits under this Plan by virtue of having become the legal representative of
the Participant.
(aa) "Plan" shall mean this International Aircraft Investors 1996
Stock Option and Award Plan.
(bb) "QDRO" shall mean a qualified domestic relations order.
(cc) "Restricted Stock" shall mean shares of Common Stock awarded
to a Participant under this Plan subject to payment of such consideration, if
any, and such conditions on vesting (which may include, among others, the
passage of time, specified performance objectives or other factors) and such
transfer and other restrictions as are established in or pursuant to this Plan
and the related Award Agreement, for so long as such shares remain unvested
under the terms of the applicable Award Agreement.
(dd) "Retirement" shall mean retirement with the consent of the
Company or retirement from active service as an employee or officer of the
Company on or after attaining age 65.
(ee) "Rule 16b-3" shall mean Rule 16b-3 as promulgated by the
Commission pursuant to the Exchange Act, as amended from time to time.
(ff) "Section 16 Person" shall mean a person subject to Section
16(a) of the Exchange Act.
(gg) "Securities Act" shall mean the Securities Act of 1933, as
amended from time to time.
(hh) "Stock Appreciation Right" or "SAR" shall mean a right
authorized under this Plan to receive a number of shares of Common Stock or an
amount of cash, or a combination of shares and cash, the aggregate amount or
value of which is determined by reference to a change in the Fair Market Value
of the Common Stock.
(ii) "Stock Bonus" shall mean an Award of shares of Common Stock
for no consideration other than past services and without restriction other than
such transfer or other restrictions as the Committee may deem advisable to
assure compliance with law.
(jj) "Subsidiary" shall mean any corporation or other entity a
majority of whose outstanding voting stock or voting power is beneficially owned
directly or indirectly by the Corporation.
(kk) "Total Disability" shall mean a "permanent and total
disability" within the meaning of Section 22(e)(3) of the Code and such other
disabilities, infirmities, afflictions or conditions as the Committee by rule
may include.
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