AMERICAN GREETINGS CORPORATION 2007 OMNIBUS INCENTIVE COMPENSATION PLAN (AS AMENDED MAY 1, 2011)
Exhibit
10.2
ARTICLE 1
DEFINITIONS
In this Plan, except where the context otherwise indicates, the
following definitions apply.
1.1 “Agreement” means an agreement
in Writing delivered to the Grantee, which evidences a grant of
an Award under the Plan.
1.2 “Appreciation Right” means a
right granted pursuant to Article 8 of this Plan.
1.3 “Award” means an Option, Share
Award, Restricted Share, Deferred Share, Performance Bonus,
Performance Share, Directors’ Share, Performance Unit,
Appreciation Right or Dividend Equivalents granted under this
Plan.
1.4 “Board” means the Board of
Directors of the Corporation.
1.5 “Change in Control” means the
happening of any of the following events:
(i) the Corporation is merged or consolidated or
reorganized into or with another corporation or other legal
person, and as a result of such merger, consolidation or
reorganization less than a majority of the combined voting power
of the then-outstanding securities of such corporation or person
immediately after such transaction is held in the aggregate by
the holders of Common Stock immediately prior to such
transaction;
(ii) the Corporation sells or otherwise transfers all or
substantially all of its assets to any other corporation or
other legal person, and less than a majority of the combined
voting power of the then-outstanding securities of such
corporation or person immediately after such transaction is held
in the aggregate by the holders of Common Stock immediately
prior to such transaction;
(iii) there is a report filed on Schedule 13D or
Schedule TO (or any successor schedule, form or report),
each as promulgated pursuant to the Exchange Act, disclosing
that any person (as the term “person” is used in
Section 13(d)(3) or Section 14(d)(2) of the Exchange
Act) has become the beneficial owner (as the term
“beneficial owner” is defined under
Rule 13d-3
or any successor rule or regulation promulgated under the
Exchange Act) of securities representing 20% or more of the
Voting Power;
(iv) the Corporation files a report or proxy statement with
the Securities and Exchange Commission pursuant to the Exchange
Act disclosing in response to
Form 8-K
or Schedule 14A (or any successor schedule, form or report
or item therein) that a Change in Control of the Corporation has
occurred; or
(v) if during any period of two consecutive years,
individuals who at the beginning of any such period constitute
the directors of the Corporation cease for any reason to
constitute at least a majority thereof, unless the election, or
the nomination for election by the Corporation’s
shareholders, of each director of the Corporation first elected
during such period was approved by a vote of at least two-thirds
of the directors of the Corporation then still in office who
were directors of the Corporation at the beginning of any such
period.
(vi) Notwithstanding the foregoing provisions of
Section 1.5(iii) and (iv) above, a “Change in
Control” shall not be deemed to have occurred for purposes
of this Plan (i) solely because (A) the Corporation;
(B) a Subsidiary; (C) any Corporation –
sponsored employee stock ownership plan or other employee
benefit plan of the Corporation; or (D) any family member
of Xxxxx Xxxxxxxxxx (including lineal descendants, spouses of
such descendants, the lineal descendants of any such spouse, the
spouses of any such spouses’ lineal descendants and trust
(including voting trusts)) either files or becomes obligated to
file a report or proxy statement under or in response to
Schedule 13D, Schedule TO,
Form 8-K
or
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Schedule 14A (or any successor schedule, form or report or
item therein) under the Exchange Act, disclosing beneficial
ownership by it of shares, whether in excess of 20% of the
Voting Power or otherwise, or because the Corporation reports
that a Change in Control of the Corporation has or may have
occurred or will or may occur in the future by reason of such
beneficial ownership or (ii) solely because of a Change in
Control of any Subsidiary.
(vii) Notwithstanding the foregoing, if and to the extent
that any provision of this Plan or an Award would cause a
payment of deferred compensation that is subject to
Section 409A(a)(2) of the Internal Revenue Code to be made
upon the occurrence of a “Change in Control,” then
such payment shall not be made unless such “Change in
Control” satisfies the requirements of
Section 409A(2)(A)(v) of the Internal Revenue Code and
applicable regulations and rulings thereunder.
1.6 “Class A Common Shares”
means Class A Common Shares, par value $1.00 per share, of
the Corporation.
1.7 “Class B Common Shares”
means Class B Common Shares, par value $1.00 per share, of
the Corporation.
1.8 “Committee” means (except as
otherwise provided or limited in the following sentence), the
full Board or the Board’s Compensation and Management
Development Committee, or such other committee or designee
(including, without limitation, an officer of the Corporation)
appointed by the Board or the Compensation and Management
Development Committee to manage Awards generally or specific
individual or group of Awards. To the extent required by
Section 162(m) of the Internal Revenue Code,
Rule 16b-3
of the Exchange Act or other similar requirement, any action
taken by the Committee shall be taken by the Committee as a
whole or by a subcommittee of at least two members, and all the
members of the Committee or such subcommittee will be
“outside directors” as defined in Treas. Reg.
Section 1.162-27(e)(3)
or any similar successor regulation
and/or
“non-employee directors” as defined in
Rule 16b-3(b)(3)(i)
of the Exchange Act or any similar successor rule. In all other
events, the Chairman of the Committee shall be authorized to act
on behalf of the Committee unless otherwise determined by the
Committee. Except where the context otherwise requires,
references in the Plan to the “Committee” also shall
be deemed to refer to the Chairman and to any delegate of the
Committee while acting within the scope of such delegation.
1.9 “Common Stock” means
Class A Common Shares, Class B Common Shares or both.
1.10 “Corporation” means American
Greetings Corporation.
1.11 “Covered Employee” means an
Eligible Person who is, or is determined by the Committee to
become, a “covered employee” within the meaning of
Section 162(m) of the Internal Revenue Code (or any
successor provision).
1.12 “Deferral Period” means the
period of time during which Deferred Shares, Awards or other
compensation is subject to deferral limitations under
Section 7.3 or Article 13 of this Plan.
1.13 “Deferred Shares” means an
Award made pursuant to Section 7.3 of this Plan of the
right to receive Common Stock at the end of a specified Deferral
Period.
1.14 “Director” means any member of
the Board, or any member of a board of directors of a
Subsidiary, who is not also an employee of the Corporation or
any Subsidiary.
1.15 “Directors’ Share” means
a Share awarded to a Director pursuant to Section 7.5 of
this Plan.
1.16 “Dividend Equivalent” means an
amount determined by multiplying the number of shares of Common
Stock subject to a grant by the per-share cash dividend, or the
per-share fair market value (as determined by the Committee) of
any dividend in consideration other than cash, paid by the
Corporation on its Common Stock.
1.17 “Effective Date” means
February 13, 2007.
1.18 “Eligible Person” means a key
employee, officer or consultant of the Corporation or of a
Subsidiary, or a Director, selected by the Committee as eligible
to receive an Award under the Plan.
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1.19 “Exchange Act” means the
Securities Exchange Act of 1934 as amended, and the rules and
regulations promulgated thereunder.
1.20 “Fair Market Value” means, as
of any given date, the closing price of the Class A Common
Shares as reported on the New York Stock Exchange (or if the
Class A Common Shares are not then traded on the New York
Stock Exchange, as reported by such other national securities
exchange or quoted on the Nasdaq National Market or such other
automated quotation system in which the Class A Common
Shares are quoted) as of the close of business on such date or
the latest such date in which there is a listing. Fair Market
Value shall be determined in a manner that complies with the
requirements of Section 409A of the Internal Revenue Code
and regulations and rulings thereunder.
1.21 “Grantee” means an Eligible
Person to whom an Award has been granted.
1.22 “Grant Date” means
(i) with respect to Options and Appreciation Rights, the
date on which such Award is approved by the Committee, or such
later date specified by the Committee in authorizing the Award
provided that (A) the Eligible Person does not have the
ability to individually negotiate the key terms and conditions
of the Award with the Corporation or, if so, such negotiations
have concluded and (B) the key terms of the Award are
expected to be communicated to the Grantee or group of Grantees
within a relatively short period of time from the date as of
which the Award is authorized to be granted; and
(ii) with respect to all other Awards, the date on which
such Award is approved by the Committee, or such later date
specified by the Committee in authorizing the Award.
1.23 “Incentive Stock Option” means
an Option granted under the Plan that qualifies as an incentive
stock option under Section 422 of the Internal Revenue Code
(or any successor provision) and that the Corporation designates
as such in the Agreement granting the Option.
1.24 “Internal Revenue Code” means
the Internal Revenue Code of 1986 as amended, and the rules and
regulations promulgated thereunder.
1.25 “Nonstatutory Stock Option”
means an Option granted under the Plan that is not an Incentive
Stock Option.
1.26 “Option” means an option to
purchase Shares granted under the Plan in accordance with the
terms of Article 6 of this Plan.
1.27 “Option Period” means the
period during which an Option may be exercised.
1.28 “Option Price” means the price
per Share at which an Option may be exercised. The Option Price
for any Option will equal the Fair Market Value on the Grant
Date, unless otherwise determined by the Committee in its
discretion pursuant to an Option that contains terms and
conditions that satisfy (or qualify such Option for an exemption
from) the applicable requirements of Section 409A of the
Internal Revenue Code.
1.29 “Optionee” means an Eligible
Person to whom an Option has been granted.
1.30 “Performance Criteria” means
the performance standards selected by the Committee that may be
based on revenue; gross margin; product line contribution;
operating and other expenses; operating earnings; earnings
before interest, taxes, depreciation and amortization
(“EBITDA”); earnings before interest and taxes
(“EBIT”); pre-tax or after-tax profits; net income;
earnings per share; cash flow; productivity; return on assets;
return on capital; return on equity; cash flow/net assets;
debt/capital ratio; return on net capital employed
(“RONCE”); sales growth; stock price appreciation; or
total shareholder return (share appreciation plus dividends as
if reinvested), and may be absolute in their terms or measured
against or in relationship to changes from period to period or
against or in relationship to other companies comparably,
similarly or otherwise situated.
1.31 “Performance Period” means the
period or periods, which may be of overlapping durations, during
which each Performance Criterion of Qualified Performance-Based
Compensation or other performance
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criterion of a performance-based Award will be measured against
the Performance Criteria or other performance goals established
by the Committee and specified in the Agreement relating thereto.
1.32 “Performance Bonus” means an
award granted pursuant to Article 9 of this Plan.
1.33 “Performance Share” means a
bookkeeping entry that records the equivalent of one Common
Share awarded pursuant to Section 7.4 of this Plan.
1.34 “Performance Unit” means a
bookkeeping entry that records a unit equivalent to $1.00
awarded pursuant to Section 7.4 of this Plan.
1.35 “Plan” means this American
Greetings Corporation 2007 Omnibus Incentive Compensation Plan
which is the Plan set forth in this document, as amended from
time to time.
1.36 “Potential Change in Control”
shall be deemed to have occurred if the event set forth in any
one of the following paragraphs shall have occurred:
(i) the Corporation enters into an agreement, the
consummation of which would result in the occurrence of a Change
in Control;
(ii) the commencement of a proxy contest in which any
person (as such term is defined in Section 3(9) of the
Exchange Act and also includes any group deemed to be a person
under Section 13(d)(3) of the Exchange Act) seeks to
replace or remove a majority of the members of the Board;
(iii) the Board otherwise adopts a resolution to the effect
that, for purposes of this Agreement, a Potential Change in
Control has occurred; or
(iv) the Corporation files a report or proxy statement with
the Securities and Exchange Commission pursuant to the Exchange
Act disclosing in response to
Form 8-K
or Schedule 14A (or any successor schedule, form or report
or item therein) that a Change in Control of the Corporation may
or will occur in the future.
1.37 “Qualified Performance-Based
Compensation” means any compensation that is
intended to qualify as “qualified performance-based
compensation” as described in Section 162(m)(4)(C) of
the Internal Revenue Code.
1.38 “Related Award” means the
Award in connection with which a Related Right is granted.
1.39 “Related Right” means an
Appreciation Right granted in connection with a specified Award
or by amendment of an outstanding Nonstatutory Stock Option
granted under the Plan.
1.40 “Restricted Share” means a
Share awarded to an Eligible Person pursuant to Section 7.2 of
this Plan that is subject to certain restrictions and may be
subject to forfeiture.
1.41 “Right Period” means the
period during which an Appreciation Right may be exercised.
1.42 “Securities Act” means the
Securities Act of 1933 as amended, and the rules and regulations
promulgated thereunder.
1.43 “Share” means a share of
authorized but unissued Common Stock, Common Stock held in
treasury or a reacquired share of Common Stock, including shares
purchased by the Corporation on the open market for purposes of
the Plan or otherwise.
1.44 “Share Award” means an award
of Common Stock, or an Award denominated in terms of Common
Stock, as described in Article 7 of this Plan, and
includes, without limitation, a Restricted Share, a
Directors’ Share, a Deferred Share and a Performance Share.
1.45 “Subsidiary” means an entity
which is a member of a “controlled group” or under
“common control” with the Corporation as determined
under Section 414(b) or (c) of the Internal Revenue
Code, except that an entity will be deemed to be in a controlled
group or under common control with the Corporation for this
purpose if the Corporation either directly or indirectly owns at
least 50% (or 20% with legitimate business
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criteria) of the total combined voting power of all classes of
stock (or similar interests) of such entity or would otherwise
satisfy the definition of service recipient under
Section 409A of the Internal Revenue Code.
1.47 “Voting Power” means at any
time, the total votes relating to the then-outstanding
securities entitled to vote generally in the election of
directors of the Corporation.
1.48 “Writing” means any paper or
electronic means of documenting the terms of an Agreement
hereunder which satisfies such requirements for formality,
authenticity and verification of signature and authority as may
be established by the Committee or by those persons responsible
for performing administrative functions under the Plan.
ARTICLE 2
PURPOSE
The Plan is intended to promote the success and enhance the
value of the Corporation by linking the personal interests of
Directors, officers and other key employees and consultants to
those of the Corporation’s shareholders and by providing
flexibility to the Corporation in its ability to motivate,
attract and retain the services of Directors, officers and other
key employees and consultants upon whose judgment, interest and
special effort the successful conduct of the Corporation’s
operations is largely dependent.
ARTICLE 3
PLAN
MANAGEMENT AND ADMINISTRATION
The Plan will be managed by the Committee. Administrative
functions may include, without limitation, documenting and
communicating Awards made hereunder, maintaining records
concerning such Awards, and satisfying (or assisting Eligible
Persons in satisfying) any applicable reporting, disclosure, tax
filing or withholding, or other legal requirements concerning
Awards. Each member of the Committee is entitled to, in good
faith, rely or act upon any report or other information
furnished to that member by any officer or other employee of the
Corporation or any Subsidiary, the Corporation’s
independent registered public accounting firm or other certified
public accountants, or any executive compensation consultant or
other professional retained to assist in the administration of
the Plan. In addition to any other powers granted to the
Committee, it will have the following management powers, subject
to the express provisions of the Plan:
3.1 to determine in its discretion the Eligible Persons or
group of Eligible Persons to whom Awards will be granted;
3.2 to determine the types of Awards to be granted;
3.3 to determine the number of Awards to be granted to an
Eligible Person or to a group of Eligible Persons and the number
of Shares to be subject to each Award or pool of Awards;
3.4 to determine the terms and conditions of any Award,
including, but not limited to, the Option Price, xxxxx xxxxx, or
purchase price, any restrictions or limitations on the Award,
any schedule for lapse of forfeiture restrictions or
restrictions on the exercisability of an Award, and
accelerations or waivers thereof, and any provisions related to
non-competition and recapture of gain on an Award, based in each
case on considerations as the Committee in its sole discretion
determines;
3.5 to construe and interpret any Agreement and the Plan;
3.6 to require, whether or not provided for in the
pertinent Agreement, of any Grantee, the making of any
representations or agreements that the Committee may deem
necessary or advisable in order to comply with, or qualify for
advantageous treatment under, applicable securities, tax, or
other laws;
3.7 to provide for satisfaction of a Grantee’s tax
liabilities arising in connection with the Plan through, without
limitation, retention by the Corporation of Shares otherwise
issuable on the exercise of, or pursuant to, an Award or through
delivery of Common Stock to the Corporation by the Grantee under
such terms and
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conditions as the Committee deems appropriate, including but not
limited to any Share attestation procedure approved or ratified
by the Committee or by delivery of a properly executed notice
together with irrevocable instructions to a broker to promptly
deliver to the Corporation the amount of sale or loan proceeds
to pay the tax liabilities, provided that in any case the Share
amount retained will not exceed the minimum applicable required
withholding tax rate for federal (including FICA), state or
local tax liability;
3.8 to make all other determinations and take all other
actions necessary or advisable for the management and
administration of the Plan, including but not limited to
establishing, adopting or revising any rules and regulations as
it may deem necessary;
3.9 to delegate to officers or managers of the Corporation
or any Subsidiary the authority to make Awards to Eligible
Persons, to select such Eligible Persons, and to determine such
terms and conditions thereof as may be specified in such
delegation, from a pool of Awards authorized by the Committee;
3.10 to condition the grant of any Award or combination of
Awards authorized under this Plan on the surrender or deferral
by the Eligible Person of his or her right to receive a cash
bonus or other compensation otherwise payable by the Corporation
or a Subsidiary to the Grantee; and
3.11 without limiting the generality of the foregoing, to
provide in its discretion in an Agreement:
(i) for an agreement by the Grantee to render services to
the Corporation or a Subsidiary upon such terms and conditions
as may be specified in the Agreement, provided that the
Committee will not have the power under the Plan to commit the
Corporation or any Subsidiary to employ or otherwise retain any
Optionee or Grantee;
(ii) for restrictions on the transfer, sale or other
disposition of Shares issued to the Grantee;
(iii) for an agreement by the Grantee to resell to the
Corporation, under specified conditions, Shares issued in
connection with an Award;
(iv) for the payment of the Option Price upon the exercise
of an Option otherwise than in cash, including without
limitation by delivery of Common Stock valued at Fair Market
Value on the exercise date of the Option or a combination of
cash and Common Stock; by means of any Share attestation
procedure approved or ratified by the Committee; or by delivery
of a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Corporation
the amount of sale proceeds to pay the exercise price;
(v) for the deferral of receipt of amounts that otherwise
would be distributed upon exercise or payment of an Award, the
terms and conditions of any such deferral and any interest or
Dividend Equivalent or other payment that will accrue with
respect to deferred distributions, subject to the provisions of
Article 13 of this Plan; and
(vi) for the effect of a Change in Control or Potential
Change of Control, as defined herein, of the Corporation on the
rights of a Grantee with respect to any Award.
(vii) Any determinations or actions made or taken by the
Committee pursuant to this Article will be binding and final.
ARTICLE 4
ELIGIBILITY
Eligible Persons may be granted one or more Awards; provided,
however, that Incentive Stock Options will not be granted to
Directors.
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ARTICLE 5
SHARES SUBJECT
TO THE PLAN
5.1 Subject to adjustment as provided in Article 14 of
this Plan and Section 5.3 below, the number of Shares that
may be issued or transferred (i) upon the exercise of
Options or Appreciation Rights; (ii) as Share Awards;
(iii) as Restricted Shares and released from substantial
risk of forfeiture thereof; (iv) as Deferred Shares;
(v) in payment of Performance Shares or Performance Units
that have been earned; (vi) as Directors’ Shares; or
(vii) in payment of Dividend Equivalents paid with respect
to awards made under the Plan, shall not exceed in the aggregate
5,600,000 Class A Common Shares and 1,200,000 Class B
Common Shares, respectively. Such Shares may be shares of
original issuance or treasury shares or a combination of the
foregoing.
5.2 Subject to adjustment as provided in Article 14 of
this Plan, grants of Incentive Stock Options under the Plan may
not be made with respect to more than 5,600,000 Class A
Common Shares and 1,200,000 Class B Common Shares during
any calendar year, provided that such limits only apply to the
extent consistent with applicable regulations relating to
Incentive Stock Options under the Internal Revenue Code. With
respect to one fiscal year, (i) subject to adjustment as
provided in Article 14 of this Plan an Eligible Person
shall not receive Appreciation Rights in excess of 500,000
Class A Common Shares and 500,000 Class B Common
Shares; (ii) an Eligible Person shall not receive an award
of Performance Shares or Performance Units having an aggregate
maximum value as of their respective Grant Date in excess of
$5,000,000; and (iii) subject to adjustment as provided in
Article 14 of this Plan, an Eligible Person shall not
receive Awards in excess, in the aggregate, of 500,000
Class A Common Shares and 500,000 Class B Common
Shares and collectively 500,000 Shares (“Individual
Limit”).
5.3 Shares underlying outstanding Awards made under the
Plan will be available for subsequent issuance under the Plan to
the extent those Awards are forfeited, expire or terminate for
any reason prior to the issuance of the Shares subject to those
Awards. Shares issued under the Plan subject to a vesting
requirement and subsequently forfeited or repurchased by the
Corporation, at a price per Share not greater than the original
issue price paid per Share, pursuant to the Corporation’s
repurchase rights under the Plan or the applicable Agreement
will be added back to the number of Shares reserved for issuance
under the Plan and accordingly will be available for subsequent
reissuance. Should the exercise price of an Option under the
Plan be paid with Shares, then the authorized reserve of Common
Stock under the Plan will be reduced by the gross number of
Shares for which that Option is exercised, and not by the net
number of Shares issued under the exercised Option. If Shares
otherwise issuable under the Plan are withheld by the
Corporation in satisfaction of the withholding taxes incurred in
connection with the exercise of an Option, Appreciation Right or
issuance of fully-vested Shares under another type of Award,
then the number of Shares available for issuance under the Plan
will be reduced by the gross number of Shares issuable under the
exercised Option or Appreciation Right or the gross number of
fully-vested Shares issuable under another type of Award,
calculated in each instance prior to any such share withholding.
Notwithstanding the foregoing, any Award or portion of an Award
that in accordance with the terms of the applicable Agreement,
is payable only in cash immediately will be added back to the
number of Shares reserved for issuance under the Plan and
accordingly will be available for subsequent reissuance.
5.4 Where two or more Awards are granted in relation to
each other such that the exercise or payment of one such Award
automatically and by its terms reduces the number of Shares that
may be issued or the amount that may be received pursuant to the
other Award or Awards, then the amount that will be included for
purposes of the Individual Limit set forth in Section 5.2
of this Plan for such Awards will be the amount that is the
maximum number of Shares that could be issued or received
pursuant to such Awards and their related Awards taken as a
whole, and only the maximum number of Shares that could be
issued pursuant to such Awards will be counted against the
number of Shares reserved under the Plan at the time of their
grant.
5.5 In the case of any Award granted in substitution for an
award of a business, corporation or other entity acquired by the
Corporation or a Subsidiary, Shares issued or issuable in
connection with such substitution will not be counted against
the number of Shares reserved under the Plan, but will be
available
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under the Plan by virtue of the Corporation’s assumption of
the plan or arrangement of the acquired business, corporation or
other entity.
ARTICLE 6
OPTIONS
6.1 The Committee is hereby authorized to grant Incentive
Stock Options and Nonstatutory Stock Options to any employee who
is an Eligible Person and to grant Nonstatutory Stock Options to
any Director, provided that the number of Options granted to an
Eligible Person during a fiscal year will not exceed the
applicable limitations set forth in Article 5 of this Plan
when aggregated with other Awards made to that Eligible Person
during that fiscal year.
6.2 All Options will be evidenced by an Agreement. All
Agreements granting Incentive Stock Options will contain a
statement that the Option is intended to be an Incentive Stock
Option; if no such statement is included in the Agreement, or if
the Agreement affirmatively states that the Option is intended
to be a Nonstatutory Stock Option, the Option shall be a
Nonstatutory Stock Option.
6.3 All Agreements shall specify the number of Class A
Common Shares or Class B Common Shares to which it pertains
subject to the limitations set forth in Article 5 of this
Plan.
6.4 The Option Period will be determined by the Committee
and specifically set forth in the Agreement, provided that an
Option will not be exercisable after ten years from the Grant
Date.
6.5 The Committee will, at or after the Grant Date,
determine the methods by which the Option Price of an Option may
be paid and the form or forms of payment that may be permitted.
6.6 The Committee may provide in the Agreement evidencing
the grant of an Option that the Committee, in its sole
discretion, will have the right to substitute an Appreciation
Right for such Option at any time prior to or upon exercise of
such Option; provided, however, that such Appreciation Right
will be exercisable with respect to the same number of Shares
for which such substituted Option would have been exercisable.
6.7 The Committee may provide in the Agreement evidencing a
grant of Options (other than Incentive Stock Options) that the
Committee, in its sole discretion, will have the right to
provide for the payment of Dividend Equivalents to the Optionee
on either a current, deferred, or contingent basis or may
provide that such equivalents shall be credited against the
Option Price.
6.8 The exercise of an Option shall result in the
cancellation on a
share-for-share
basis of any Related Right authorized under Article 8 of
this Plan.
6.9 Except as otherwise determined by the Committee and set
forth in an Agreement, if a Director subsequently becomes an
employee of the Corporation or a Subsidiary while remaining a
member of the Board, any Options held under the Plan by such
individual at the time of such commencement of employment shall
not be affected thereby. If an employee who is also a Director
terminates employment, any Awards granted in connection with
such individual’s employment will continue to be governed
by and subject to the provisions of the Plan and the Agreement
regarding a termination of employment.
6.10 All other terms of Options granted under the Plan will
be determined by the Committee in its sole discretion.
ARTICLE 7
SHARE
AWARDS, PERFORMANCE UNITS AND DIRECTORS’ AWARDS
7.1 The Committee is authorized to grant Share Awards to
any Eligible Person in such amounts and subject to such terms
and conditions as determined by the Committee, provided that the
number of Shares awarded to an Eligible Person during a fiscal
year will not exceed the applicable limitations set forth in
Article 5 of this Plan when aggregated with other Share
Awards made to that Eligible Person during that fiscal
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year. All Share Awards will be evidenced by an Agreement. Shares
issued or transferred pursuant to a Share Award may be issued or
transferred for consideration or no consideration (except as
required by applicable law).
7.2 Except as otherwise determined by the Committee and set
forth in an Agreement, Restricted Shares are subject to the
following terms and conditions:
(i) Each such grant shall constitute an immediate transfer
of the ownership of Common Stock to the Eligible Person in
consideration for the performance of services, entitling such
Eligible Person to voting, dividend and other ownership rights
consistent with the Corporation’s Articles of
Incorporation, Code of Regulations and other corporate documents
as applicable to and governing Class A Common Shares and
Class B Common Shares, but subject to the substantial risk
of forfeiture and restrictions on transfer hereinafter referred
to and subject to any requirement that requires any or all
dividends or other distributions paid with respect to Restricted
Shares be automatically deferred and reinvested in additional
Restricted Shares, which may be subject to the same restrictions
as the underlying award.
(ii) Each such grant may be made without additional
consideration or in consideration of a payment by such Eligible
Person that is more or less than Fair Market Value per Share at
the Grant Date.
(iii) Each such grant shall provide that the Restricted
Shares covered by such grant shall be subject to a
“substantial risk of forfeiture” within the meaning of
Section 83 of the Internal Revenue Code. Each such grant
shall provide that during the period for which such substantial
risk of forfeiture is to continue the transferability of the
Restricted Shares shall be prohibited or restricted in the
manner and to the extent prescribed by the Committee at the
Grant Date. Except as otherwise determined by the Committee at
the time of the grant of Restricted Shares or thereafter, upon
termination of employment or service with or for the Corporation
and/or
Subsidiaries during the applicable restriction period,
Restricted Shares that are at that time subject to restrictions
will be forfeited.
(iv) Any grant of Restricted Shares may specify Performance
Criteria or other performance goals which, if achieved, will
result in termination or early termination of the restrictions
applicable to such shares, and each grant may specify in respect
of such specified Performance Criteria or other performance
goals, a minimum acceptable level of achievement and shall set
forth a formula for determining the number of Restricted Shares
on which the restrictions will terminate if performance is at or
above the minimum level, but falls short of full achievement of
the specified Performance Criteria or other performance goals.
(v) If certificates representing Restricted Shares are
registered in the name of the Grantee, those certificates must
bear an appropriate legend referring to the terms, conditions
and restrictions applicable to such Restricted Shares, and the
Corporation may, at its discretion, retain physical possession
of certificates until such time as all applicable restrictions
lapse.
7.3 Except as otherwise determined by the Committee and set
forth in an Agreement, Deferred Shares are subject to the
following terms and conditions:
(i) Each such grant shall constitute the agreement by the
Corporation to deliver Common Stock to the Eligible Person in
the future in consideration of the performance of services, but
subject to the fulfillment of such conditions during the
Deferral Period as the Committee may specify.
(ii) Each such grant may be made without additional
consideration or in consideration of a payment by such Eligible
Person that is more or less than Fair Market Value per Share at
the Grant Date.
(iii) Each such grant shall be subject to a Deferral Period
of not less than one year, as determined by the Committee at the
Grant Date except (if the Committee shall so determine) in the
event of a Change in Control or other similar transaction or
event.
(iv) During the Deferral Period, an Eligible Person shall
have no right to transfer any rights under his or her award,
shall have no rights of ownership in the Deferred Shares and
shall have no right to vote them, but the Committee may, at or
after the Grant Date, authorize the payment of Dividend
Equivalents
9
on such shares on either a current, deferred, or contingent
basis, either in cash or in additional Common Stock.
(v) Each grant shall be consistent with Section 409A
of the Internal Revenue Code, as the Committee may approve.
7.4 Except as otherwise determined by the Committee and set
forth in an Agreement, Performance Shares or Performance Units
are subject to the following terms and conditions:
(i) The Performance Period with respect to each Performance
Share and Performance Unit shall be such period of time
designated in the Agreement (as shall be determined by the
Committee at the time of grant) commencing with the Grant Date.
(ii) Any grant of Performance Shares and Performance Units
shall specify Performance Criteria or other performance goals
which, if achieved, will result in payment or early payment of
the Award, and each grant may specify in respect of such
specified Performance Criteria or other performance goals a
minimum acceptable level of achievement and shall set forth a
formula for determining the number of Performance Shares or
Performance Units that will be earned if performance is at or
above the minimum level, but falls short of full achievement or
the specified Performance Criteria or other performance goals.
(iii) Each grant shall specify the time and manner of
payment of Performance Shares or Performance Units that have
been earned. Any grant may specify that the amount payable with
respect thereto may be paid by the Corporation in cash, in
Class A Common Shares or Class B Common Shares or in
any combination thereof and may either grant to the Eligible
Person or retain in the Committee the right to elect among those
alternatives.
(iv) The Committee may, at or after the Grant Date, provide
for the payment of Dividend Equivalents to the holder thereof on
either a current, deferred or contingent basis, either in cash
or in additional Common Stock.
7.5 Subject to the applicable limitations set forth in
Article 5 of this Plan, Directors may elect to receive
Class A or Class B Common Shares, as determined by the
Board, in an amount equal to (and in lieu of) any or all fees
owed to them by the Corporation as compensation for serving on
the Corporation’s Board. For the purposes of this
Section 7.5, Shares are valued at the closing price
reported on the New York Stock Exchange (or if the Class A
Common Shares are not then traded on the New York Stock
Exchange, as reported by such other national securities exchange
or quoted on the Nasdaq National Market or such other automated
quotation system in which the Class A Common Shares are
quoted) on the last trading day of the calendar quarter prior to
payment of such fees. Any fractional shares shall be paid as
cash.
ARTICLE 8
APPRECIATION
RIGHTS
8.1 The Committee may grant Appreciation Rights to any
Eligible Person, upon such terms and conditions as the Committee
deems appropriate under this Article 8, provided that the
number of Appreciation Rights granted to an Eligible Person
during a fiscal year will not exceed the applicable limitations
set forth in Article 5 of this Plan when aggregated with
other Appreciation Rights made to that Eligible Person during
that fiscal year.
8.2 An Appreciation Right may be granted under the Plan:
(i) in connection with, and at the same time as, the grant
of an Option to an Eligible Person;
(ii) by amendment of an outstanding Nonstatutory Stock
Option granted under the Plan to an Eligible Person; or
(iii) independently of any Option granted under the Plan.
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An Appreciation Right granted under clause (i) or
(ii) of the preceding sentence is a Related Right. A
Related Right may, in the Committee’s discretion, apply to
all or a portion of the Options subject to the Related Award.
8.3 An Appreciation Right may be exercised in whole or in
part as provided in the Agreement, and, subject to the
provisions of the Agreement, entitles its Grantee to receive,
without any payment to the Corporation (other than required tax
withholding amounts), either cash or that number of Shares
(equal to the highest whole number of Shares), or a combination
thereof, in an amount or having a Fair Market Value determined
as of the date such Appreciation Right is exercised not to
exceed the number of shares underlying the Appreciation Right
exercised multiplied by an amount equal to the excess of the
Fair Market Value on the exercise date of the Appreciation Right
over the “base price”, which is the Fair Market Value
on the Grant Date of the Appreciation Right (or such price in
excess of Fair Market Value on the Grant Date as the Committee
determined at the time of grant).
8.4 The Right Period will be determined by the Committee
and specifically set forth in the Agreement, provided, however
that an Appreciation Right that is a Related Right may be
exercised only when and to the extent the Related Award is
exercisable.
8.5 The exercise or settlement, in whole or in part, of a
Related Right will cause a reduction on a
share-for-share
basis in any Related Award.
8.6 The Committee may specify Performance Criteria or other
performance goals that must be achieved as a condition of the
exercise of such rights.
8.7 Each grant of Appreciation Rights shall be evidenced by
an Agreement that identifies the related Options (if applicable)
and contains such terms and provisions, consistent with this
Plan, as the Committee may approve.
ARTICLE 9
PERFORMANCE
BONUSES
The Committee may grant Performance Bonuses under the Plan in
the form of cash or Shares to Eligible Persons that the
Committee may from time to time select, in the amounts and
pursuant to the terms and conditions that the Committee may
determine, subject to the provisions below:
9.1 Performance Bonuses will be awarded in connection with
a Performance Period, the length of which will be determined by
the Committee.
9.2 The Committee will determine the persons who will be
eligible to receive a Performance Bonus under the Plan.
9.3 Performance Criteria or other performance goals,
performance targets and other award criteria shall be determined
as follows:
(i) The Committee will fix and establish (A) the
performance goals that will apply to that Performance Period;
(B) the target amount payable to each Eligible Person; and
(C) subject to Section 9.4 below, the criteria for
computing the amount that will be paid with respect to each
level of attained performance. The Committee may also set forth
the minimum level of performance, based on objective factors,
that must be attained during the Performance Period before any
Performance Bonus will be paid and the percentage of the target
amount that will become payable upon attainment of various
levels of performance that equal or exceed any minimum required
level.
(ii) The Committee may, in its discretion, select
performance goals that measure the performance of the Eligible
Person, the Corporation or one or more business units, divisions
or Subsidiaries of the Corporation. The Committee may select
performance goals that are absolute or relative to the
performance of one or more comparable companies or an index of
comparable companies. The performance goals may be described in
terms of company-wide objectives or objectives that are related
to the performance of the individual Eligible
11
Person or of the Subsidiary, division, department, region or
function within the Corporation or Subsidiary in which the
Eligible Person is employed.
9.4 In applying the performance goals, the Committee may,
in its discretion, exclude unusual or infrequently occurring
items (including any event listed in Article 14 of this
Plan and the cumulative effect of changes in the law,
regulations or accounting rules), and may determine to exclude
other items, each determined in accordance with GAAP (to the
extent applicable) and as identified in the financial
statements, notes to the financial statements or discussion and
analysis of management.
9.5 All such Performance Bonuses shall be paid no later
than the 15th day of the third month following the end of
the calendar year (or, if later, following the end of the
Corporation’s fiscal year) in which such Performance
Bonuses are no longer subject to a substantial risk of
forfeiture (as determined for purposes of Section 409A of
the Internal Revenue Code). The Committee may provide that
Awards will be payable, in whole or in part, in the event of the
Grantee’s death or disability, a Change of Control or under
other circumstances.
ARTICLE 10
QUALIFIED
PERFORMANCE-BASED COMPENSATION
10.1 The Committee may determine that an Award or Awards
granted to an Eligible Person will be considered “qualified
performance-based compensation” under Section 162(m)
of the Internal Revenue Code. The provisions of this
Article 10 apply only to any such Awards that are to be
considered “qualified performance-based compensation”
under Section 162(m) of the Internal Revenue Code. To the
extent that Awards designated as “qualified
performance-based compensation” under Section 162(m)
of the Internal Revenue Code are made, no such Award may be made
as an alternative to another Award that is not also designated
as “qualified performance-based compensation” but
instead must be separate and apart from all other Awards made.
10.2 When Options or Appreciation Rights that are to be
considered “qualified performance-based compensation”
are granted, the Committee approving such grants must consist
solely of two or more “outside directors” as defined
in Treas. Reg.
Section 1.162-27(e)(3),
and the Option Price or base price, as the case may be,
established for the grant by the Committee will not be less than
the Fair Market Value on the Grant Date.
10.3 When Awards other than Options or Appreciation Rights
that are to be considered “qualified performance-based
compensation” are granted, the Committee will establish in
writing (i) the Performance Criteria that must be met,
(ii) the Performance Period during which performance will
be measured, (iii) the maximum amounts that may be paid if
the Performance Criteria are met, and (iv) any other
conditions that the Committee deems appropriate and consistent
with the Plan and the requirements of Section 162(m) of the
Internal Revenue Code for “qualified performance-based
compensation.” The Performance Criteria will satisfy the
requirements for “qualified performance-based
compensation,” including the requirement that the
achievement of the goals be substantially uncertain at the time
they are established and that the Performance Criteria be
established in such a way that a third party with knowledge of
the relevant facts could determine whether and to what extent
the Performance Criteria have been met. The Committee will not
have discretion to increase the maximum amount of compensation
that is payable upon achievement of the designated Performance
Criteria, but the Committee may in its discretion reduce the
amount of compensation that is payable to an Eligible Person
upon achievement of the designated Performance Criteria.
10.4 The Committee will establish the Performance Criteria
in writing either before the beginning of the Performance Period
or during a period ending no later than the earlier of
(i) 90 days after the beginning of the Performance
Period or (ii) the date on which 25% of the Performance
Period has been completed, or such other date as may be required
or permitted under applicable regulations under
Section 162(m) of the Internal Revenue Code.
12
10.5 The Committee will certify and announce the results
for the Performance Period to all affected Grantees after the
Corporation determines the financial and other relevant
performance results for the Performance Period. The Committee
will determine the amount, if any, to be paid pursuant to each
Award based on the achievement of the Performance Criteria and
the terms of each Agreement.
10.6 The Committee may provide that Awards will be payable,
in whole or in part, in the event of the Grantee’s death or
disability, a Change of Control or under other circumstances
consistent with the Treasury regulations and rulings under
Section 162(m) of the Internal Revenue Code.
ARTICLE 11
TRANSFERABILITY
11.1 Except as otherwise determined by the Committee on a
case-by-case
basis, no Options, Appreciation Rights or other derivative
security granted under the Plan shall be transferable by an
Optionee other than by will or the laws of descent and
distribution. Except as otherwise determined by the Committee on
a
case-by-case
basis, Options and Appreciation Rights shall be exercisable
during the Optionee’s lifetime only by him or her or by his
or her guardian or legal representative.
11.2 The Committee may specify at the Grant Date that part
or all of the Common Stock that is (i) to be issued or
transferred by the Corporation upon the exercise of Option
grants or Appreciation Rights, upon the termination of the
Deferral Period applicable to Deferred Shares or upon payment
under any grant of Performance Shares or Performance Units or
(ii) no longer subject to the substantial risk of
forfeiture and restrictions on transfer referred to in
Section 7.2 of this Plan, shall be subject to further
restrictions on transfer.
11.3 The Grantee acknowledges that the Plan is intended to
conform to the extent necessary with all provisions of the
Securities Act, the Exchange Act, and any and all regulations
and rules promulgated thereunder, or by the Securities and
Exchange Commission, and state securities laws and regulations.
Notwithstanding anything herein to the contrary, the Plan shall
be administered and Awards may be granted and exercised only in
such manner to conform to such laws, rules and regulations. To
the extent permitted by applicable law, the Plan and any
Agreement shall be deemed amended to the extent necessary to
conform to such laws, rules and regulations.
ARTICLE 12
EXERCISE;
PAYMENT OF WITHHOLDING TAXES
An Award that is exercisable by the Grantee may, subject to the
provisions of the Agreement under which it was granted, be
exercised in whole or in part by the delivery to the Corporation
of written notice of the exercise, in such form as the Committee
may prescribe. The exercise, however, will not be effective
until the Corporation has received the election notice and will
be subject to receipt by the Corporation of payment of any
applicable Option Price or other amount due in connection with
such exercise, calculation by the Corporation of the applicable
withholding taxes, and receipt by the Corporation of payment for
any applicable withholding taxes.
ARTICLE 13
DEFERRAL OF
AWARDS OR COMPENSATION
13.1 If a Grantee so elects in accordance with the terms of
an Agreement, the Grantee may defer (i) any or all of an
amount otherwise payable in connection with an Award or
(ii) any payment of a cash bonus or other compensation in
exchange for an Award under this Plan, provided that:
(i) the Grantee makes such election by delivering to the
Corporation written notice of such election, at such time and in
such form as the Committee may from time to time prescribe in
accordance with the deferral requirements set forth in
Section 409A of the Internal Revenue Code;
13
(ii) such election will be irrevocable;
(iii) such deferred payment will be made in accordance with
the provisions of such deferred compensation plan; and
(iv) the terms of the deferred compensation plan and the
election to defer under this Plan comply with Section 409A
of the Internal Revenue Code.
13.2 The Committee may also provide that deferral issuances
and settlements include the payment or crediting of Dividend
Equivalents or interest on the deferral amounts. Nothing in this
Plan shall be deemed to limit an Eligible Person’s ability
to defer compensation under any other deferred compensation
plan, arrangement or Agreement maintained by the Corporation.
ARTICLE 14
CAPITAL
ADJUSTMENTS
The number and class of Shares subject to each outstanding Share
Award, the Option Price, the base price for any Appreciation
Right or other Award using such a price, the aggregate number
and class of Shares for which grants of Share Awards thereafter
may be made or in which Awards may be paid, and the limits
provided for in Article 5 of this Plan, will be subject to
such adjustment, if any, as the Committee in its sole discretion
deems appropriate to reflect any corporate transaction or event,
including, without limitation, dividends, Share splits,
spin-offs,
split-ups,
recapitalizations, mergers, consolidations or reorganizations of
or by the Corporation.
ARTICLE 15
CONSEQUENCES
OF A CHANGE IN CONTROL
OR POTENTIAL
CHANGE IN CONTROL
15.1 In the event of a Change in Control or Potential
Change in Control, in addition to such other actions
contemplated herein, the Committee may take any one or more of
the following actions with respect to any or all outstanding
Awards, without the consent of any Eligible Person: (i) the
Committee may determine that outstanding Options and
Appreciation Rights shall be fully exercisable, and restrictions
on outstanding Restricted Shares, Deferred Shares, Performance
Shares and Performance Units shall lapse, as of the date of the
Change in Control or at such other time as the Committee
determines, (ii) the Committee may require that Eligible
Persons surrender their outstanding Options and Appreciation
Rights in exchange for one or more payments by the Corporation,
in cash or Common Stock as determined by the Committee, in an
amount equal to the amount by which the then Fair Market Value
of the shares of Common Stock subject to the Eligible
Persons’ unexercised Options and Appreciation Rights
exceeds the exercise price, if any, and on such terms as the
Committee determines, (iii) after giving Eligible Persons
an opportunity to exercise their outstanding Options and
Appreciation Rights, the Committee may terminate any or all
unexercised Options and Appreciation Rights at such time as the
Committee deems appropriate, (iv) with respect to Grantees
holding Share Awards, Directors’ Shares, Performance Units
or Dividend Equivalents, the Committee may determine that such
Grantees shall receive one or more payments in settlement of
such Share Awards, Directors’ Shares and Performance Units,
in such amount and form and on such terms as may be determined
by the Committee, or (v) the Committee may determine that
Awards that remain outstanding after the Change in Control shall
be converted to similar grants of, or assumed by, the surviving
corporation (or a parent or subsidiary of the surviving
corporation or successor). Such acceleration, surrender,
termination, settlement or conversion shall take place as of the
date of the Change in Control or such other date as the
Committee may specify.
15.2 The Committee may provide in an Agreement that a sale
or other transaction involving a Subsidiary or other business
unit of the Corporation shall be considered a Change in Control
for purposes of an Award, or the Committee may establish other
provisions that shall be applicable in the event of a specified
transaction.
14
ARTICLE 16
TERMINATION
OR AMENDMENT
16.1 The Board or the Committee may amend, alter or
terminate this Plan in any respect, at any time; provided,
however, that no amendment, alteration or termination of this
Plan will be made by the Board or the Committee without approval
of (i) the Corporation’s shareholders to the extent
shareholder approval of the amendment is required by applicable
law or regulations or the requirements of the principal exchange
or interdealer quotation system on which the Common Stock is
listed or quoted, and (ii) each affected Optionee or
Grantee if such amendment, alteration or termination would
adversely affect his or her rights or obligations under any
Award made prior to the date of such amendment, alteration or
termination except as otherwise permitted under Articles 15
and 19 of this Plan.
16.2 The effective date of any amendment to the Plan will
be the date specified by the Board or Committee, as applicable.
Any amendments to the Plan requiring shareholder approval
pursuant to this Article 16 are subject to approval by vote
of the shareholders of the Corporation within twelve months
after their adoption by the Board or the Committee. Subject to
that approval, any such amendments are effective as of the date
on which they are adopted by the Board. Awards may be granted or
awarded prior to shareholder approval of amendments, but each
Award requiring such amendments will be subject to the approval
of the amendments by the shareholders. The date on which any
Award made prior to shareholder approval of the amendment will
be the Grant Date for all purposes of the Plan as if the Award
had not been subject to approval. No Award granted subject to
shareholder approval of an amendment may be exercised prior to
such shareholder approval, and any dividends payable thereon are
subject to forfeiture if such shareholder approval is not
obtained. Presentation of this Plan or any amendment hereof for
shareholder approval shall not be construed to limit the
Corporation’s authority to offer similar or dissimilar
benefits under other plans without shareholder approval.
16.3 Neither the Board nor the Committee shall, without
further approval of the shareholders of the Corporation,
authorize the amendment of any outstanding Option to reduce the
Option Price. Furthermore, no Option shall be canceled and
replaced with awards having a lower Option Price without further
approval of the shareholders of the Corporation. This
Section 16.3 is intended to prohibit the repricing of
“underwarter” Options and shall not be construed to
prohibit the adjustments provided for in Section 14 of this
Plan.
16.4 Neither the Board nor the Committee shall, without
further approval of the shareholders of the Corporation,
authorize any Option grant to provide for automatic
“reload” rights, the automatic grant of Options to the
Optionee upon the exercise of Options using Shares or other
equity.
ARTICLE 17
TERM OF THE
PLAN
Unless sooner terminated by the Board or the Committee pursuant
to Article 16 of this Plan, the Plan will terminate ten
years after the date on which the Plan was first approved by the
shareholders of the Corporation. The termination will not affect
the validity of any Awards outstanding on the date of
termination. Awards may be granted or awarded prior to
shareholder approval of this Plan, but any Award requiring such
shareholder approval will be subject to approval of the Plan by
the shareholders. No Award granted subject to such shareholder
approval, and any dividends payable thereon, are subject to
forfeiture if such shareholder approval is not obtained.
ARTICLE 18
INDEMNIFICATION
OF COMMITTEE
In addition to such other rights of indemnification as they may
have as directors or as members of the Committee, the members of
the Committee will be indemnified by the Corporation against the
reasonable expenses, including attorneys’ fees, actually
and reasonably incurred in connection with the defense of any
15
action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason
of any action taken or failure to act under or in connection
with the Plan or any Awards granted hereunder, and against all
amounts reasonably paid by them in settlement thereof or paid by
them in satisfaction of a judgment in any such action, suit or
proceeding, if such members acted in good faith and in a manner
which they believed to be in, and not opposed to, the best
interests of the Corporation.
ARTICLE 19
COMPLIANCE
WITH SECTION 409A OF THE INTERNAL REVENUE CODE
To the extent the Committee determines that any Award granted
under the Plan is subject to Section 409A of the Internal
Revenue Code, the Agreement evidencing such Award will
incorporate the terms and conditions required by
Section 409A of the Internal Revenue Code. To the extent
applicable, the Plan and Agreement will be interpreted in
accordance with Section 409A of the Internal Revenue Code
and Department of Treasury regulations and other interpretive
guidance issued thereunder, including without limitation any
such regulations or other guidance that may be issued after the
Effective Date. Notwithstanding any provision of the Plan, in
the event that following the Effective Date the Committee
determines that any Award may be subject to Section 409A of
the Internal Revenue Code, the Committee may adopt such
amendments to the Plan
and/or the
applicable Agreement or adopt policies and procedures or take
any other action or actions, including an action or amendment
with retroactive effect, that the Committee determines is
necessary or appropriate to (i) exempt the Award from the
application of Section 409A of the Internal Revenue Code or
(ii) comply with the requirements of Section 409A of
the Internal Revenue Code.
ARTICLE 20
GENERAL
PROVISIONS
20.1 The establishment of the Plan will not confer upon any
Eligible Person any legal or equitable right against the
Corporation, any Subsidiary or the Committee, except as
expressly provided in the Plan.
20.2 All grants and awards under the Plan are subject to
the condition subsequent that an appropriate Agreement be signed
by the parties.
20.3 Neither the Plan nor any Agreement constitutes
inducement or consideration for the employment or retention of
any Eligible Person, nor are they a contract of employment or
retention for a specific term between the Corporation or any
Subsidiary and any Eligible Person. Participation in the Plan
will not give an Eligible Person any right to be retained in the
service of the Corporation or any Subsidiary as an employee, a
director or otherwise.
20.4 The Corporation and its Subsidiaries may assume
options, warrants, or rights to purchase shares issued or
granted by other corporations or entities whose shares or assets
are acquired by the Corporation or its Subsidiaries, or which
are merged into or consolidated with the Corporation or its
Subsidiaries. Neither the adoption of this Plan, nor its
submission to the shareholders, will be taken to impose any
limitations on the powers of the Corporation or its affiliates
to issue, grant, or assume options, warrants, or rights,
otherwise than under this Plan, or to adopt other share option
or restricted share plans or other incentives, or to impose any
requirement of shareholder approval upon the same.
20.5 Except as the Committee may otherwise provide, or as
may otherwise be required by a deferral election pursuant to
Article 13 of this Plan, the interests of any Eligible
Person under the Plan are not subject to the claims of creditors
and may not, in any way, be assigned, alienated or encumbered.
20.6 The Board or the Committee may, in its sole
discretion, delegate authority hereunder not already delegated
by the terms hereof, including but not limited to delegating
authority to select Eligible Persons, to grant Awards, to
establish terms and conditions of Awards, or to amend, manage,
administer, interpret, construe or vary the Plan or any Awards
or Agreements, to the extent permitted by applicable law or
administrative or regulatory rule.
16
20.7 The Committee may, without amending the Plan,
determine the terms and conditions applicable to grants of
Awards to Grantees who are foreign nationals or employed outside
the United States in a manner otherwise inconsistent with the
Plan if the Board deems such terms and conditions necessary in
order to recognize differences in local law or regulations, tax
policies or customs.
20.8 The Plan will be governed, construed and administered
in accordance with the laws of the State of Ohio, without
reference to its conflict of laws provisions, and it is the
intention of the Corporation that Incentive Stock Options
granted under the Plan qualify as such under Section 422 of
the Internal Revenue Code and that Qualified Performance-Based
Compensation granted under the Plan qualify as “qualified
performance-based compensation” as described in
Section 162(m) of the Internal Revenue Code.
17
