Exhibit 99.1
X-RITE, INCORPORATED
2006 OMNIBUS LONG TERM INCENTIVE PLAN
1. Purpose. The purpose of the X-Rite, Incorporated 2006 Omnibus Long
Term Incentive Plan (the "Plan") is to provide (i) officers and key employees of
X-Rite, Incorporated (the "Company") and its subsidiaries, (ii) certain
consultants and advisors who perform services for the Company or its
subsidiaries, and (iii) members of the Board of Directors of the Company (the
"Board"), with the opportunity to acquire or be granted shares of the Common
Stock of the Company ("Common Stock") or receive monetary payments based on the
long term economic performance of the Company.
The Company believes that the Plan will:
(1) In the case of officers and certain management employees, encourage
stock ownership by such employees which will provide an incentive for
such employees to expand and improve the profits and prosperity of the
Company, and to assist the Company in attracting and retaining such
employees;
(2) In the case of outside directors, make service on the Board of
Directors of the Company more attractive to present and prospective
outside directors and to provide additional incentive for such
directors to direct the Company effectively by offering them a greater
interest in the continued success of the Company;
(3) In the case of certain consultants and advisors, to encourage stock
ownership by such consultants and advisors which will provide an
incentive to expand and improve the profits and prosperity of the
Company and to make continued service to the Company more attractive.
2. Administration.
(a) Committee. The Plan shall be administered and interpreted by a
compensation committee (the "Committee"). The Committee may consist of two
or more members of the Board who are "outside directors" as defined under
Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code") and "non-employee directors" as defined under Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or such
other members of the Board.
(b) Authority of Committee. The Committee has the sole authority, subject
to the provisions of the Plan, to (i) select the employees and other
individuals to receive Awards (as defined in Section 4) under the Plan,
(ii) determine the type, size and terms of the Awards to be made to each
individual selected, (iii) determine the time when the Awards will be
granted and the duration of any applicable exercise and vesting period,
including the criteria for exercisability and vesting and the acceleration
of exercisability and vesting with respect to each individual selected, and
(iv) deal with any other matter arising under the Plan. The Committee may,
in its discretion, delegate day-to-day administrative tasks to other
individuals. The Committee is authorized to interpret the Plan and the
Awards granted under the Plan, to establish, amend and rescind any rules
and regulations relating to the Plan, and to make any other determination
that it deems necessary or desirable for the administration of the Plan.
The Committee may correct any defect or supply any omission or reconcile
any inconsistency in the Plan or in any Award in the manner and to the
extent the Committee deems necessary or desirable. Any decision of the
Committee in the interpretation and administration of the Plan shall lie
within its sole and absolute discretion and shall be final, conclusive and
binding on all parties concerned. All powers of the Committee shall be
executed in its sole discretion and need not be uniform as to similarly
situated individuals
(c) Responsibility of Committee. No member of the Board, no member of the
Committee and no employee of the Company shall be liable for any act or
failure to act hereunder, except in circumstances involving his or her bad
faith, gross negligence or willful misconduct, or for any act or failure to
act hereunder by any other member of the Committee or employee of the
Company. The Company shall indemnify members of the Committee and any
employee of the Company against any and all liabilities or expenses to
which they may be subjected by reason of any act or failure to act with
respect to their duties under the Plan, except in circumstances involving
his or her bad faith, gross negligence or willful misconduct.
3. Participants. All employees, officers and directors of the Company and
its subsidiaries or any corporation in which the Company has a proprietary
interest (including members of the Board who are not employees), as well as
consultants and advisors to the Company or its subsidiaries or in any
corporation in which the Company has a proprietary interest, are eligible to
participate in the Plan. Consistent with the purposes of the Plan, the Committee
shall have exclusive power to select the employees, officers, directors and
consultants and advisors who may participate in the Plan ("Participants").
Eligible individuals may be selected individually or by groups or categories, as
determined by the Committee in its discretion, and designation as a person to
receive Awards in any year shall not require the Committee to designate such a
person as eligible to receive Awards in any other year.
4. Types of Awards. Awards under the Plan may be granted in any one or a
combination of (a) Stock Options, (b) Stock Appreciation Rights, (c) Restricted
Stock Awards and (d) Restricted Stock Units (each as described below, and
collectively, "Awards"). Awards may constitute Performance-Based Awards, as
described in Section 10. Each Award shall be evidenced by a written agreement
between the Company and the Participant (an "Agreement"), which need not be
identical between Participants or among Awards, in such form as the Committee
may from time to time approve; provided, however, that in the event of any
conflict between the provisions of the Plan and any Agreement, the provisions of
the Plan shall prevail.
5. Common Stock Available under the Plan. The aggregate number of shares
of Common Stock that may be subject to Awards shall be 3,500,000 shares of
Common Stock, which may be authorized and unissued, subject to any adjustments
made in accordance with Section 11 hereof; provided that the maximum number of
shares of Common Stock that may be subject to Restricted Stock Awards and
Restricted Stock Units shall be 1,000,000. The maximum number of shares of
Common Stock with respect to which Restricted Stock Awards and Restricted Stock
Units may be granted in any one calendar year shall be 200,000. The maximum
number of shares of Common Stock with respect to which Awards may be granted to
any individual Participant in any one calendar year shall be 125,000. Any share
of Common Stock subject to an Award that for any reason is cancelled or
terminated without having been exercised or vested shall again be available for
Awards under the Plan; provided, however, that any such availability shall apply
only for purposes of determining the aggregate number of shares of Common Stock
subject to Awards and shall not apply for purposes of determining the maximum
number of shares subject to Awards that any individual Participant may receive.
6. Stock Options. Stock Options will enable a Participant to purchase
shares of Common Stock upon set terms and at a fixed purchase price. Stock
Options may be treated as (i) "incentive stock options" within the meaning of
Section 422(b) of the Code ("Incentive Stock Options"), or (ii) Stock Options
which do not constitute Incentive Stock Options ("Nonqualified Stock Options").
Each Stock Option shall be subject to the terms, conditions and restrictions
consistent with the Plan as the Committee may impose, subject to the following
limitations:
(a) Exercise Price. The exercise price per share (the "Exercise Price") of
Common Stock subject to a Stock Option shall be determined by the Committee
and may not be less than the Fair Market Value (as defined in Section 15)
of a share of Common Stock on the date the Stock Option is granted.
(b) Payment of Exercise Price. The Exercise Price may be paid in cash or,
in the discretion of the Committee, by the delivery of shares of Common
Stock that have been owned by the Participant for at least six months, by
Stock Appreciation Rights, or by a combination of these methods. In the
discretion of the Committee, payment may also be made by delivering a
properly executed exercise notice to the Company together with a copy of
irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds to pay the Exercise Price. To facilitate
the foregoing, the Company may enter into agreements for coordinated
procedures with one or more brokerage firms, provided such agreements and
procedures comply with applicable law. The Committee may also prescribe any
other method of paying the Exercise Price that it determines to be
consistent with applicable law and the purpose of the Plan, including,
without limitation, in lieu of the exercise of a Stock Option by delivery
of shares of Common Stock of the Company then owned by the Participant,
providing the Company with a notarized statement attesting to the number of
shares owned for at least six months, where upon verification by the
Company, the Company would issue to the Participant only the number of
incremental shares to which the Participant is entitled upon exercise of
the Stock Option.
(c) Exercise Period. Stock Options shall be exercisable at such time or
times and subject to such terms and conditions as shall be determined by
the Committee; provided, however, that no Stock Option shall be exercisable
later than ten years after the date it is granted. All Stock Options shall
terminate at such earlier times and upon such conditions or circumstances
as the Committee shall determine, as set forth in the related Agreement.
(d) Limitations on Incentive Stock Options. Incentive Stock Options may be
granted only to Participants who, at the time of the grant, are employees
of the Company, a subsidiary or any corporation in which the Company has a
proprietary interest, and only at an Exercise price that is not less than
the Fair Market Value of a share of Common Stock on the date of the grant.
The aggregate Fair Market Value of the Common Stock (determined as of the
date of the grant) with respect to which Incentive Stock Options are
exercisable for the first time by a Participant during any calendar year
(under all option plans of the Company) shall not exceed $100,000. For
purposes of the preceding sentence, Incentive Stock Options will be taken
into account in the order in which they are granted. Incentive Stock
Options may not be granted to a Participant who, at the time of grant, owns
stock possessing (after the application of the attribution rules of Section
424(d) of the Code) more than 10% of the total combined voting power of all
outstanding classes of stock of the Company or any subsidiary of the
Company, unless the option price is fixed at not less than 110% of the Fair
Market Value of the Common Stock on the date of grant and the exercise of
such Incentive Stock Option is prohibited by its terms after the expiration
of five years from its date of grant
(e) Termination of Employment, Disability or Death.
(1) Except as provided below or in an Agreement, a Stock Option may
only be exercised while the Participant is employed by, or providing
service to, the Company, as an employee, member of the Board or
advisor or consultant. In the event that a Participant ceases to be
employed by, or provide service to, the Company for any reason other
than Disability (as defined in Paragraph (5) below), death or
termination for Cause (as defined in Paragraph (5) below), any Stock
Option which is otherwise exercisable by the Participant shall
terminate as provided in the Award agreement unless the Committee
subsequently amends a Participant's Award agreement for termination of
employment provisions. Except as otherwise provided by the Committee,
any Stock Options which are not otherwise exercisable as of the date
on which the Participant ceases to be employed by, or provide service
to, the Company shall terminate as of such date.
(2) In the event the Participant ceases to be employed by, or provide
service to, the Company on account of a termination for Cause by the
Company, any Stock Option held by the Participant shall terminate as
of the date the Participant ceases to be employed by, or provide
service to, the Company. In addition, notwithstanding any other
provisions of this Section 6, if the Committee determines that the
Participant has engaged in conduct that constitutes Cause at any time
while the Participant is employed by, or providing service to, the
Company, or after the Participant's termination of employment or
service, any Stock Option held by the Participant shall immediately
terminate. In the event the Committee determines that the Participant
has engaged in conduct that constitutes Cause, in addition to the
immediate termination of all Stock Options, the Participant shall
automatically forfeit all shares underlying any exercised portion of a
Stock Option for which the Company has not yet delivered the share
certificates, upon refund by the Company of the Exercise Price paid by
the Participant for such shares (subject to any right of setoff by the
Company).
(3) Except as otherwise provided by the Committee, in the event the
Participant ceases to be employed by, or provide service to, the
Company because the Participant is Disabled, any Stock Option which is
otherwise exercisable by the Participant shall terminate unless
exercised within two years after the date on which the Participant
ceases to be employed by, or provide service to, the Company, but in
any event no later than the date of expiration of the Stock Option.
(4) Except as otherwise provided by the Committee, if the Participant
dies while employed by, or providing service to, the Company, any
Stock Option which is otherwise exercisable by the Participant shall
terminate unless exercised within two years after the date on which
the Participant ceases to be employed by, or provide service to, the
Company, but in any event no later than the date of expiration of the
Stock Option.
(5) For purposes of this Section 6(e):
(A) The term "Company" shall mean the Company and its subsidiary
corporations or any other entity in which the Company holds a
proprietary interest.
(B) "Disability" or "Disabled" shall mean a physical or mental
infirmity which impairs the Participant's ability to
substantially perform the Participant's duties or the
Participant's regular occupation with the Company, which
continues for a period of at least one hundred eighty (180)
consecutive days.
(C) "Cause" shall mean, except to the extent specified otherwise
by the Committee, a finding by the Committee that the Participant
has (i) engaged in conduct involving dishonesty or fraud or
conviction of a crime involving more turpitude; (ii)
intentionally engaged in conduct which is materially injured to
the Company, monetarily or otherwise; or (iii) failed to perform
assigned duties (other than a failure resulting from an illness
or other similar incapacity or disability), or to comply with the
policies applicable to all Company employees after demand for
performance or compliance is made to the Participant; or (iv)
breached any other provision of his or her terms of employment or
service contract with the Company, including without limitation
covenants against competition, or has engaged in disloyalty to
the Company, including, without limitation, fraud, embezzlement,
theft, commission of a felony or proven dishonesty in the course
of his or her employment or service, or has disclosed trade
secrets or confidential information of the Company to persons not
entitled to receive such information.
(f) No Repricing. In no event shall the Committee cancel any outstanding
Stock Option with an exercise price greater than the then current Fair
Market Value of the Common Stock for the purpose of reissuing any other
Award to the Participant at a lower exercise price nor reduce the exercise
price of an outstanding Stock Option without stockholder approval.
7. Stock Appreciation Rights. Stock Appreciation Rights shall provide a
Participant with the right to receive a payment, in cash, Common Stock or a
combination thereof, in an amount equal to the excess of (i) the Fair Market
Value, or other specified valuation, of a specified number of shares of Common
Stock on the date the right is exercised, over (ii) the Fair Market Value of
such shares on the date of grant, or other specified valuation (which shall be
no less than the Fair Market Value on the date of grant). Each Stock
Appreciation Right shall expire no more than ten years from its date of grant,
and shall be subject to such other terms and conditions as the Committee shall
deem appropriate, including, without limitation, provisions for the forfeiture
of the Stock Appreciation Right for no consideration upon termination of
employment. In no event shall the Committee cancel any outstanding Stock
Appreciation Right with a grant price greater than the then current Fair Market
Value of the Common Stock for the purpose of reissuing any other Award to the
Participant at a lower grant price nor reduce the grant price of an outstanding
Stock Appreciation Right without stockholder approval.
8. Restricted Stock Awards. Restricted Stock Awards shall consist of
Common Stock issued or transferred to Participants with or without other
payments therefor as additional compensation for services to the Company.
Restricted Stock Awards may be subject to such terms and conditions as the
Committee determines appropriate, including, without limitation, restrictions on
the sale or other disposition of such shares and the right of the Company to
reacquire such shares for no consideration upon termination of the Participant's
employment within specified periods or prior to becoming vested. The Committee
may require the Participant to deliver a duly signed stock power, endorsed in
blank, relating to the Common Stock covered by a Restricted Stock Award. The
Committee may also require that the stock certificates evidencing such shares be
held in custody or bear restrictive legends until the restrictions thereon shall
have lapsed. Each Restricted Stock Award shall specify whether the Participant
shall have, with respect to the shares of Common Stock subject to a Restricted
Stock Award, all of the rights of a holder of shares of Common Stock of the
Company, including the right to receive dividends and to vote the shares.
9. Restricted Stock Units. Restricted Stock Units may be awarded or sold
to Participants under such terms and conditions as shall be established by the
Committee. Restricted Stock Units shall provide a Participant with the right to
receive Common Stock at a date on or after vesting in accordance with the terms
of such grant and/or upon the attainment of performance criteria specified by
the Committee. Restricted Stock Units shall be subject to such restrictions as
the Committee determines.
10. Performance-Based Awards. Certain Awards granted under the Plan may be
granted in a manner such that they qualify for the performance based
compensation exemption from Section 162(m) of the Code ("Performance-Based
Awards").
(a) Committee. Notwithstanding any other provision of the Plan to the
contrary, the Committee for purposes of granting Performance-Based Awards
shall consist of two or more members of the Board who are "outside
directors" as defined under Section 162(m) of the Internal Revenue Code of
1986, as amended (the "Code") and "non-employee directors" as defined under
Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or such other members of the Board
(b) Performance-Based Criteria. As determined by the Committee in its sole
discretion, either the granting, vesting or payment of such
Performance-Based Awards are to be based upon one or more of the following
factors: net sales; pretax income before allocation of corporate overhead
and bonus; budget; earnings per share; net income; division, group or
corporate financial goals; return on stockholders' equity; return on
assets; attainment of strategic and operational initiatives; appreciation
in and/or maintenance of the price of the Common Stock or any other
publicly-traded securities of the Company; market share; gross profits;
earnings before interest and taxes; earnings before interest, taxes,
depreciation and amortization; economic value-added models and comparisons
with various stock market indices; reductions in costs; or any combination
of the foregoing. With respect to Performance-Based Awards that are not
Stock Options or Stock Appreciation Rights based solely on the appreciation
in the Fair Market Value of Common Stock after the grant of the Award, (i)
the Committee shall establish in writing (x) the objective
performance-based goals applicable to a given period and (y) the individual
employees or class of employees to which such performance-based goals
apply, no later than 90 days after the commencement of such fiscal period
(but in no event after 25% of such period has elapsed), (ii) no
Performance-Based Awards shall be payable to or vest with respect to, as
the case may be, any Participant for a given fiscal period until the
Committee certifies in writing that the objective performance goals (and
any other material terms) applicable to such period have been satisfied,
and (iii) the Committee may reduce or eliminate the number of shares of
Common Stock or cash granted or the number of shares of Common Stock vested
upon the attainment of such performance goal. After establishment of a
performance goal, the Committee shall not revise such performance goal or
increase the amount of compensation payable thereunder (as determined in
accordance with Section 162(m) of the Code) upon the attainment of such
performance goal.
11. Adjustments to Awards. In the event of any change in the outstanding
Common Stock of the Company by reason of any stock split, stock dividend,
split-up, split-off, spin-off, recapitalization, merger, consolidation,
reorganization, combination or exchange of shares, a sale by the Company of all
or part of its assets, or in the event of any distribution to stockholders of
other than a normal cash dividend, relevant changes in Federal income tax laws,
regulations and rulings, or other extraordinary or unusual event, if the
Committee shall determine that such change equitably requires an adjustment to
the terms of any Awards or the number of shares of Common Stock that are subject
to Awards, such adjustment shall be made by the Committee and shall be final,
conclusive and binding for all purposes of the Plan. In the event of any merger,
consolidation or reorganization of the Company with or into another corporation
which results in the outstanding Common Stock of the Company being converted
into or exchanged for different securities, cash or other property, or any
combination thereof, there shall be substituted, on an equitable basis as
determined by the Committee in its discretion, for each share of Common Stock
then subject to an Award granted under the Plan, the number and kind of shares
of stock, other securities, cash or other property to which holders of Common
Stock will be entitled pursuant to the transaction.
12. Substitution and Assumption of Awards. The Committee may authorize the
issuance of Awards under this Plan in connection with the assumption of, or
substitution for, outstanding awards previously granted to individuals who
become employees of the Company or any subsidiary as a result of any merger,
consolidation, acquisition of property or stock, or reorganization, upon such
terms and conditions as the Committee may deem appropriate. Any substitute
Awards granted under the Plan shall not count against the limitations set forth
in Section 5.
13. Change in Control.
(a) Effect. In its sole discretion and subject to the terms of any
agreement between the Company and a Participant, the Committee may
determine that, upon the occurrence of a Change in Control (as defined
below), all or a portion of each outstanding Award shall become exercisable
or payable in full (if applicable, and whether or not then exercisable),
either upon the Change of Control or at such other date or dates that the
Committee may determine, and that any forfeiture and vesting restrictions
thereon shall lapse on such date or dates. In its sole discretion, the
Committee may also determine that, upon the occurrence of a Change in
Control, each outstanding Stock Option and Stock Appreciation Right shall
terminate within a specified number of days after notice to the Participant
thereunder, and each such Participant shall receive, with respect to each
share of Common Stock subject to such Stock Option or Stock Appreciation
Right, an amount equal to the excess of the Fair Market Value of such
shares immediately prior to such Change in Control over the exercise price
per share of such Stock Option or Stock Appreciation Right; such amount
shall be payable in cash, in one or more kinds of property (including the
property, if any, payable in the transaction) or a combination thereof, as
the Committee shall determine in its sole discretion.
(b) Defined. For purposes of this Plan, a Change in Control shall be
deemed to have occurred if:
(1) any Person is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company (not including in the
securities beneficially owned by such Person any securities acquired
directly from the Company or its Affiliates) representing thirty
percent (30%) or more of the combined voting power of the Company's
then outstanding securities;
(2) the date when Continuing Directors cease to be a majority of the
members of the Board then in office;
(3) the shareholders of the Company approve a merger or consolidation
of the Company with any other corporation, which merger or
consolidation is consummated, other than (i) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the
surviving entity), in combination with newly acquired ownership
acquired in such transaction by any trustee or other fiduciary holding
securities under an employee benefit plan of the Company or an
Affiliate, at least 50% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation, or (ii) a merger or
consolidation effected to implement a recapitalization of the Company
(or similar transaction) in which no Person acquires more than 50% of
the combined voting power of the Company's then outstanding
securities; or
(4) the shareholders of the Company approve a complete liquidation of
the Company or an agreement for the sale or disposition by the Company
of all or substantially all of the Company's assets, which
liquidation, sale or disposition is consummated.
(c) Other Terms. For purposes of Section 13(b) of this Plan, the following
terms shall have the following meanings:
(1) "Affiliate" shall mean any entity that directly or indirectly
through one or more intermediaries, controls, is controlled by or is
under common control with the Company as determined by the Board in
its discretion.
(2) "Beneficial Owner" shall have the meaning given to such term in
Rule 13d-3 under the Exchange Act.
(3) "Continuing Directors" shall mean the persons who constitute the
Board on the date hereof together with their successors whose
nominations were approved by a majority of Continuing Directors.
(4) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(5) "Person" shall have the meaning as set forth in Sections 13(d)
and 14(d) of the Exchange Act; provided however, that Person shall
exclude (i) the Company or any of its Affiliates, (ii) any trustee or
other fiduciary holding securities under an employee benefit plan of
the Company or any of its Affiliates, (iii) an underwriter temporarily
holding securities pursuant to an offering of such securities, and
(iv) any corporation owned, directly or indirectly, by the
shareholders of the Company in substantially the same proportion as
their ownership of stock of the Company.
14. Transferability of Awards. Except as provided below, a Participant's
rights under an Award may not be transferred or encumbered, except by will or by
the laws of descent and distribution or, in the case of Awards other than
Incentive Stock Options, pursuant to a qualified domestic relations order (as
defined under Section 414(p) the Code). The Committee may provide, in an
Agreement for a Nonqualified Stock Option or Restricted Stock Award, for its
transferability as a gift to family members, one or more trusts for the benefit
of family members, or one or more partnerships of which family members are the
only partners, according to such terms as the Committee may determine; provided
that the Participant receives no consideration for the transfer and the
transferred Nonqualified Stock Option or Restricted Stock Award shall continue
to be subject to the same terms and conditions as were applicable to the
Nonqualified Stock Option or Restricted Stock Award immediately before the
transfer.
15. Fair Market Value. The "Fair Market Value" per share shall be the last
reported sale price on the NASDAQ National Market on the relevant date or, if
there were no trades on that date, the latest preceding date upon which a sale
was reported, or if such value is not available the Fair Market Value per share
shall be as determined by the Committee.
16. Withholding. All distributions or payments made with respect to an
Award shall be net of any amounts required to be withheld pursuant to applicable
federal, state and local tax withholding requirements. The Company may require a
Participant to remit to it or to the subsidiary that employs a Participant an
amount sufficient to satisfy such tax withholding requirements prior to the
delivery of any certificates for Common Stock. In lieu thereof, the Company or
the employing corporation shall have the right to withhold the amount of such
taxes from any other sums due or to become due to the Participant as the Company
shall prescribe. The Committee may, in its discretion and subject to such rules
as it may adopt, permit a Participant to pay all or a portion of the federal,
state and local withholding taxes arising in connection with any Award by
electing to have the Company withhold shares of Common Stock deliverable
thereunder having a Fair Market Value that is not in excess of the amount of tax
to be withheld. The Company shall have no responsibility for any tax
consequences to a Participant.
17. Shareholder Rights. A Participant shall not have any of the rights or
privileges of a holder of Common Stock for any Common Stock that is subject to
an Award, including any rights regarding voting or the payment of dividends
(except as expressly provided under the terms of the Award), unless and until a
certificate representing such Common Stock has been delivered to the
Participant.
18. Tenure. A Participant's right, if any, to continue to serve the
Company or its subsidiaries as a director, officer, employee, consultant or
advisor shall not be expanded or otherwise affected by his or her designation as
a Participant.
19. No Fractional Shares. No fractional shares of Common Stock shall be
issued or delivered pursuant to the Plan or any Award. The Committee shall
determine whether cash shall be paid in lieu of fractional shares or whether
such fractional shares or any rights thereto shall be forfeited or otherwise
eliminated.
20. Duration, Amendment and Termination. No Award may be granted more than
ten years after the Effective Date (as described in Section 22). The Plan may be
amended or terminated in whole or in part at any time and from time to time by
the Board, but no amendment shall be effective unless and until the same is
approved by shareholders of the Company where the amendment would (i) increase
the total number of shares which may be issued under the Plan or (ii) increase
the maximum number of shares which may be issued to any individual Participant
under the Plan. No amendment or termination of the Plan shall adversely affect
in a material manner any right of any Participant with respect to any Award
theretofore granted without such Participant's written consent.
21. Governing Law. This Plan, Awards granted hereunder and actions taken
in connection with the Plan shall be governed by the laws of the State of
Michigan regardless of the law that might otherwise apply under applicable
principles of conflicts of laws.
22. Effective Date. This Plan shall be effective as of June 30, 2006 which
is the date as of which the Plan was adopted by the Board, provided that the
Plan is approved by the shareholders of the Company at its 2006 annual meeting
of shareholders, and such approval of shareholders shall be a condition to the
right of each Participant to receive an Award hereunder.