EXHIBIT 10.31
XXXX.XXX INC. 2000 LONG TERM INCENTIVE PLAN
1. Definitions. In this Plan, except where the context otherwise indicates,
the following definitions shall apply:
1.1. "Agreement" means a written agreement implementing an Award.
1.2. "Award" means a grant of an Option or Right or an award of
Restricted Stock or Incentive Shares.
1.3. "Board" means the Board of Directors of the Company.
1.4. "Code" means the Internal Revenue Code of 1986, as amended.
1.5. "Committee" means a committee or subcommittee of the Board
appointed by the Board to administer this Plan and programs hereunder. The
Committee may, in its discretion, appoint a subcommittee to administer the
Plan with respect to specific Awards hereunder.
1.6. "Common Stock" means the common stock, par value $.01 per share,
of the Company.
1.7. "Company" means Xxxx.xxx Inc.
1.8. "Date of Exercise" means the date on which the Company receives
notice of the exercise of an Option in accordance with the terms of Section
8.1.
1.9. "Date of Grant" means the date on which an Option or Right is
granted or Restricted Stock or Incentive Shares are awarded under this
Plan.
1.10. "Director" means a member of the Board of Directors of the
Company or any Subsidiary.
1.11. "Employee" means any person determined by the Committee to be an
employee of the Company or a Subsidiary, including an Employee Director,
consultant or any person who has been hired to be an employee of the
Company or a Subsidiary.
1.12. "Employee Director" means a Director who is also an Employee.
1.13. "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
1.14. "Fair Market Value" means an amount equal to the last sale price
for a Share on the Nasdaq National Market as reported by such source as the
Committee may select, or, if such price quotations of the Common Stock are
not then reported, then the fair market value of a Share as
determined by the Committee pursuant to a reasonable method adopted in good
faith for such purpose.
1.15. "Grantee" means an Employee or Director to whom Restricted Stock
has been awarded pursuant to Section 9 or Incentive Shares have been
awarded pursuant to Section 10.
1.16. "Incentive Shares" means an award providing for the contingent
grant of Shares pursuant to the provisions of Section 10.
1.17. "Incentive Stock Option" means an Option granted under this Plan
that the Company designates as an incentive stock option under Section 422
of the Code in the Agreement granting the Option.
1.18. "Nonstatutory Stock Option" means an Option granted under this
Plan that is not an Incentive Stock Option.
1.19. "Option" means an option to purchase Shares granted under this
Plan in accordance with the terms of Section 6.
1.20. "Option Period" means the period during which an Option may be
exercised.
1.21. "Option Price" means the price per Share at which an Option may
be exercised. Subject to the terms of the Plan, the Option Price shall be
determined by the Committee; provided, however, that in no event shall the
Option Price be less than the greater of 25% of the Fair Market Value as of
the Date of Grant or the par value of the Common Stock.
1.22. "Optionee" means a Director, Employee, or Employee Director to
whom an Option or Right has been granted.
1.23. "Performance Goals" means performance goals established by the
Committee, which may be based on earnings or earnings growth, sales, return
on assets, equity or investment, regulatory compliance, satisfactory
internal or external audits, improvement of financial ratings, achievement
of balance sheet or income statement objectives, or any other objective
goals established by the Committee, and may be absolute in their terms or
measured against or in relationship to other companies comparably,
similarly or otherwise situated. Such performance standards may be
particular to an employee or the department, branch, Subsidiary or other
division in which he or she works, or may be based on the performance of
the Company generally, and may cover such period as may be specified by the
Committee.
1.24. "Plan" means the Xxxx.xxx Inc. 2000 Long Term Incentive Plan, as
amended from time to time.
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1.25. "Related Option" means the Option in connection with which, or
by amendment to which, a specified Right is granted.
1.26. "Related Right" means the Right granted in connection with, or
by amendment to, a specified Option.
1.27. "Restricted Stock" means Shares awarded under the Plan pursuant
to the provisions of Section 9.
1.28. "Right" means a stock appreciation right granted under the Plan
in accordance with the terms of Section 7.
1.29. "Right Period" means the period during which a Right may be
exercised.
1.30. "Share" means a share of Common Stock.
1.31. "Subsidiary" means a corporation at least 50% of the total
combined voting power of all classes of stock of which is owned by the
Company, either directly or through one or more other Subsidiaries.
1.32. "Ten-Percent Stockholder" means an Optionee who (applying the
rules of Section 424(d) of the Code) owns stock possessing more than 10% of
the total combined voting power of all classes of stock of the Company or a
Subsidiary.
2. Purpose. This Plan is intended to assist the Company and its
Subsidiaries in attracting and retaining Directors, Employees and Employee
Directors of outstanding ability and to promote the identification of their
interests with those of the stockholders of the Company.
3. Administration. The Committee shall administer this Plan and shall have
plenary authority, in its discretion, to award Options, Rights, Restricted Stock
and Incentive Shares to Directors, Employees and Employee Directors, subject to
the provisions of this Plan. The Committee shall have plenary authority and
discretion, subject to the provisions of this Plan, to determine the Directors,
Employees or Employee Directors to whom Options or Rights shall be granted and
to whom Restricted Stock or Incentive Shares shall be awarded, the terms (which
terms need not be identical) of all Awards to Directors, Employees and Employee
Directors, including without limitation the Option Price of Options, the time or
times at which Awards are made, the number of Shares covered by Awards, whether
an Option shall be an Incentive Stock Option or a Nonstatutory Stock Option, any
exceptions to non-transferability, any Performance Goals applicable to Awards,
any provisions relating to vesting, any circumstances in which the Options would
terminate, the period during which Options and Rights may be exercised, and the
period during which Restricted Stock shall be subject to restrictions. In making
these determinations, the Committee may take into account the nature of the
services rendered or to be rendered by the Award recipients, their present and
potential contributions to the success of the Company and its
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Subsidiaries, and such other factors as the Committee in its discretion shall
deem relevant. Subject to the provisions of this Plan, the Committee shall have
plenary authority to interpret this Plan, prescribe, amend and rescind rules and
regulations relating to it, and make all other determinations deemed necessary
or advisable for the administration of this Plan. The determinations of the
Committee on the matters referred to in this Section 3 shall be binding and
final.
4. Eligibility. Options, Rights, Restricted Stock and Incentive Shares may
be granted or awarded only to Employees and Directors, provided, however, that
Directors, other than Employee Directors, may not be granted Incentive Stock
Options. A Director, Employee or Employee Director who has been granted an
Option or Right or awarded Restricted Stock or Incentive Shares may be granted
additional Options and Rights or awarded additional shares of Restricted Stock
or Incentive Shares.
5. Stock Subject to Plan.
5.1. Subject to adjustment as provided in Section 11, (a) the maximum
number of Shares that may be issued under this Plan is 5,000,000 Shares, and (b)
the maximum number of Shares with respect to which an Employee may receive
Awards under this Plan during its term is 750,000.
5.2. If an Option or Right expires or terminates for any reason
(other than termination by virtue of the exercise of a Related Option or Related
Right, as the case may be) without having been fully exercised, if Shares of
Restricted Stock are forfeited or if Shares covered by an Incentive Share Award
are not issued or are forfeited, the unissued or forfeited Shares which had been
subject to the Award shall become available for the grant of additional Awards.
5.3. Upon exercise of a Right (regardless of whether the Right is
settled in cash or Shares), the number of Shares with respect to which the Right
is exercised shall be charged against the number of Shares issuable under the
Plan and shall not become available for the grant of other Awards.
6. Options.
6.1. Options granted under this Plan to Employees shall be either
Incentive Stock Options or Nonstatutory Stock Options, as designated by the
Committee. Each Option granted under this Plan shall be clearly identified
either as a Nonstatutory Stock Option or an Incentive Stock Option and shall be
evidenced by an Agreement that specifies the terms and conditions of the grant.
Options shall be subject to the terms and conditions set forth in this Section 6
and such other terms and conditions not inconsistent with this Plan as the
Committee may specify.
6.2. The Option Period shall be determined by the Committee and
specifically set forth in the Agreement; provided, however, that an Option shall
not be exercisable after ten years
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(five years in the case of an Incentive Stock Option granted to a Ten-Percent
Stockholder) from its Date of Grant.
6.3. The Committee, in its discretion, may provide in an Agreement
for the right of the Optionee to surrender to the Company an Option (or a
portion thereof) that has become exercisable and to receive upon such surrender,
without any payment to the Company (other than required tax withholding amounts)
that number of Shares (equal to the highest whole number of Shares) having an
aggregate fair market value as of the date of surrender equal to that number of
Shares subject to the Option (or portion thereof) being surrendered multiplied
by an amount equal to the excess of (i) the Fair Market Value on the date of
surrender over (ii) the Option Price, plus an amount of cash equal to the fair
market value of any fractional Share to which the Optionee would be entitled but
for the parenthetical above relating to whole number of Shares. Any such
surrender shall be treated as the exercise of the Option (or portion thereof).
7. Rights.
7.1. Rights granted under the Plan shall be evidenced by an Agreement
specifying the terms and conditions of the grant.
7.2. A Right may be granted under the Plan:
(a) in connection with, and at the same time as, the grant of an
Option under the Plan;
(b) by amendment of an outstanding Option granted under the Plan;
or
(c) independently of any Option granted under the Plan.
7.3. A Right granted under Section 7.2(a) or Section 7.2(b) of
this Plan is a Related Right. A Related Right may, in the Board's or
Committee's discretion, apply to all or any portion of the Shares
subject to the Related Option.
7.4. A Right may be exercised in whole or in part as provided in
the applicable Agreement, and, subject to the terms of the Agreement,
entitles an Optionee to receive, without payment to the Company (but
subject to required tax withholding), 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 of
Exercise not to exceed the number of Shares subject to the portion of the
Right exercised multiplied by an amount equal to the excess of (i) the Fair
Market Value on the Date of Exercise of the Right over (ii) either (A) the
Fair Market Value on the Date of Grant of the Right if it is not a Related
Right, or (B) the Option Price as provided in the Related Option if the
Right is a Related Right.
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7.5. The Right Period shall be determined by the Committee and
specifically set forth in the Agreement, subject to the following
conditions:
(a) a Right will expire no later than the earlier of (1) ten
years from the Date of Grant, or (2) in the case of a Related Right,
the expiration of the Related Option;
(b) a Right may be exercised only when the Fair Market Value on
the Date of Exercise exceeds either (1) the Fair Market Value on the
Date of Grant of the Right if it is not a Related Right, or (2) the
Option Price of the Related Option if the Right is a Related Right;
and
(c) a Right that is a Related Right to an Incentive Stock Option
may be exercised only when and to the extent the Related Option is
exercisable.
7.6. The exercise, in whole or in part, of a Related Right shall
cause a reduction in the number of Shares subject to the Related Option
equal to the number of Shares with respect to which the Related Right is
exercised. Similarly, the exercise, in whole or in part, of a Related
Option shall cause a reduction in the number of Shares subject to the
Related Right equal to the number of Shares with respect to which the
Related Option is exercised.
8. Exercise of Options and Rights.
8.1. An Option or Right may, subject to the terms of the applicable
Agreement under which it was granted, be exercised in whole or in part by
the delivery to the Company of written notice of the exercise, in such form
as the Committee may prescribe, accompanied, in the case of an Option, by
(a) a full payment for the Shares with respect to which the Option is
exercised or (b) irrevocable instructions to a broker to deliver promptly
to the Company cash equal to the exercise price of the option. To the
extent provided in the applicable Option Agreement, payment may be made in
whole or in part by delivery (including constructive delivery) of Shares
valued at Fair Market Value on the Date of Exercise or by delivery of a
promissory note as provided in Section 8.2 hereof.
8.2. To the extent provided in an Agreement and permitted by
applicable law, the Committee may accept as partial payment of the Option
Price a promissory note executed by the Optionee evidencing his or her
obligation to make future cash payment thereof. Promissory notes made
pursuant to this Section 8.2 shall be payable upon such terms as may be
determined by the Committee, shall be secured by a pledge of the Shares
received upon exercise of the Option, or other securities the Committee may
deem to be acceptable for such purposes, and shall bear interest at a rate
fixed by the Committee.
8.3. Options and Rights made under this Plan shall be transferable by
will, the laws of descent and distribution, and as provided by the
Committee in an Agreement.
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9. Restricted Stock Awards.
9.1. Restricted Stock awards under this Plan shall consist of Shares
that are restricted against transfer, subject to forfeiture, and subject to
such other terms and conditions as may be determined by the Committee. Such
terms and conditions may provide, in the discretion of the Committee, for
the lapse of forfeiture and transfer restrictions to be contingent upon the
achievement of one or more specified Performance Goals.
9.2. Restricted Stock awards under this Plan shall be evidenced by
Agreements specifying the terms and conditions of the Award. Each Agreement
evidencing an Award of Restricted Stock shall contain the following:
(a) prohibitions against the sale, assignment, transfer,
exchange, pledge, hypothecation, or other encumbrance of (i) the
Shares awarded as Restricted Stock under this Plan, (ii) the right to
vote the Shares, and (iii) the right to receive dividends thereon, in
each case during the restriction period applicable to the Shares;
provided, however, that the Grantee shall have all the other rights of
a stockholder including without limitation the right to receive
dividends and the right to vote the Shares;
(b) a requirement that each certificate representing Shares of
Restricted Stock shall be deposited with the Company, or its designee,
and shall bear the following legend:
"This certificate and the shares of stock represented hereby are
subject to the terms and conditions (including the risks of
forfeiture and restrictions against transfer) contained in the
Xxxx.xxx Inc. 2000 Long Term Incentive Plan, and an Agreement
entered into between the registered owner and Xxxx.xxx Inc.
Release from such terms and conditions shall be made only in
accordance with the provisions of this Plan and the Agreement, a
copy of each of which is on file in the office of the Secretary
of Xxxx.xxx Inc."; and
(c) the terms and conditions upon which any restrictions
applicable to Shares of Restricted Stock shall lapse and new
certificates free of the foregoing legend shall be issued to the
Grantee or his or her legal representative.
9.3. The Committee may include in any Agreement awarding Restricted
Stock a requirement that, in the event of a Grantee's termination of
employment for any reason prior to the lapse of restrictions, all Shares of
Restricted Stock shall be forfeited by the Grantee to the Company without
payment of any consideration by the Company and neither the Grantee nor any
successors, heirs, assigns or personal representatives of the Grantee shall
thereafter have any further rights or interest in the Shares or
certificates.
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10. Incentive Share Awards. Incentive Shares awarded under this Plan shall
be evidenced by an Agreement specifying the terms and conditions of such Award.
Incentive Share Awards shall provide for the issuance of Shares to a Grantee at
such times and subject to such terms and conditions as the Committee shall deem
appropriate, including without limitation terms that condition the issuance of
Shares upon the achievement of Performance Goals.
11. Capital Adjustments. In the event of any change in the outstanding
Common Stock by reason of any stock dividend, split-up, recapitalization,
reclassification, combination or exchange of shares, merger, consolidation or
liquidation and the like, the Committee may, in its discretion, provide for a
substitution for or adjustment in (i) the number and class of Shares subject to
outstanding Options, Rights and Awards of Restricted Stock or Incentive Shares,
(ii) the Option Price of Options and the base price upon which payments under
Rights that are not Related Rights are determined, and (iii) the aggregate
number and class of Shares for which Awards thereafter may be made under this
Plan and to individual Award recipients.
12. Termination or Amendment. The Board may amend, alter or terminate this
Plan in any respect at any time; provided, however, that, after this Plan has
been approved by the stockholders of the Company, no amendment, alteration or
termination of this Plan shall be made by the Board without approval of (i) the
Company's stockholders to the extent stockholder 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 and 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.
13. Modification, Extension, Renewal, Substitution.
13.1. Subject to the terms and conditions of this Plan, the Committee
may modify, extend or renew outstanding Options and Rights, or accept the
surrender of outstanding Options and Rights granted under this Plan or
options and stock appreciation rights granted under any other plan of the
Company or a Subsidiary (to the extent not theretofore exercised), and
authorize the granting of new Options and Rights pursuant to this Plan in
substitution therefor. Any substituted Options or Rights may specify a
lower exercise price than the surrendered options and stock appreciation
rights, a longer term than the surrendered options and stock appreciation
rights, or have any other provisions that are authorized by this Plan.
Subject to the terms and conditions of this Plan, the Committee may modify
the terms of any outstanding Awards of Restricted Stock or Incentive
Shares. Notwithstanding the foregoing, however, no modification of an Award
shall, without the consent of the Optionee or Grantee, alter or impair any
of the Optionee's or Xxxxxxx's rights or obligations under such Award.
13.2. Anything contained herein to the contrary notwithstanding,
Options and Rights, Restricted Stock and Incentive Shares may, at the
discretion of the Committee, be granted under this Plan in substitution for
options to purchase shares of capital stock of another corporation which is
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merged into, consolidated with, or all or a substantial portion of the property
or stock of which is acquired by, the Company or one of its Subsidiaries. The
terms and conditions of the substitute Options, Rights, Restricted Stock and
Incentive Shares so granted may vary from the terms and conditions set forth in
this Plan to such extent as the Committee may deem appropriate in order to
conform, in whole or part, to the provisions of the Awards in substitution for
which they are granted. Such substitute Awards granted hereunder shall not be
counted toward the 750,000 Share limit imposed by the second sentence of Section
5.1, except to the extent it is determined by the Committee that counting such
Awards is required in order for Awards hereunder to be eligible to qualify as
"performance-based compensation" within the meaning of Section 162(m) of the
Code.
14. Effectiveness of this Plan. This Plan and any amendments hereto
requiring stockholder approval pursuant to Section 12 are subject to approval by
vote of the stockholders of the Company at the next annual or special meeting of
stockholders following adoption by the Board. Subject to such stockholder
approval, this Plan and any amendments hereto are effective on the date on which
they are adopted by the Board, except as otherwise specified by the Board.
Options, Rights, Restricted Stock and Incentive Shares may be granted or awarded
prior to stockholder approval of this Plan or any amendments, but each such
Award after the effective date of this Plan shall be subject to the approval by
the stockholders of this Plan. The date on which any Option, Right, Restricted
Stock or Incentive Shares granted or awarded prior to stockholder approval of
this Plan shall be the Date of Grant for all purposes as if the Option, Right,
Restricted Stock or Incentive Shares had not been subject to approval; no such
Option, Right, Restricted Stock or Incentive Shares may be exercised prior to
such stockholder approval, and any such Option shall be void ab initio if such
stockholder approval is not obtained.
15. Withholding. The Company's obligation to deliver Shares or pay any
amount pursuant to the terms of any Award hereunder shall be subject to
satisfaction of applicable federal, state and local tax withholding
requirements. To the extent provided in the applicable Agreement and in
accordance with rules prescribed by the Committee, an Optionee or Grantee may
satisfy any such withholding tax obligation by any of the following means or by
a combination of such means: (i) tendering a cash payment, (ii) authorizing the
Company to withhold Shares otherwise issuable to the Optionee or Grantee, or
(iii) delivering to the Company already-owned and unencumbered Shares.
16. Term of this Plan. Unless sooner terminated by the Board pursuant to
Section 11, this Plan shall terminate on December 30, 2008, and no Awards may be
made after such date. The termination of this Plan shall not affect the validity
of any Award outstanding on the date of termination.
17. 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 shall be indemnified by the Company against all
reasonable expenses, including attorneys' fees, actually and reasonably incurred
in connection with the defense of any 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 this
Plan or any Option, Right, Restricted
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Stock or Incentive Shares granted or awarded 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 Company.
18. General Provisions.
18.1. The establishment of this Plan shall not confer upon any
Director, Employee or Employee Director any legal or equitable right
against the Company, any Subsidiary or the Committee, except as expressly
provided in this Plan.
18.2. This Plan does not constitute inducement or consideration for
the employment of any Employee or the service of any Director or Employee
Director, nor is it a contract between the Company or any Subsidiary and
any Director, Employee or Employee Director. Participation in this Plan
shall not give a Director, Employee or Employee Director any right to be
retained in the service of the Company or any Subsidiary.
18.3. Neither the adoption of this Plan nor its submission to the
stockholders shall be taken to impose any limitations on the powers of the
Company or its Subsidiaries to issue, grant, or assume options, warrants,
rights, or restricted stock, otherwise than under this Plan, or to adopt
other stock option or restricted stock plans or to impose any requirement
of stockholder approval upon the same.
18.4. The interests of any Director, Employee or Employee Director
under this Plan are not subject to the claims of creditors and may not, in
any way, be assigned, alienated or encumbered except as provided in an
Agreement.
18.5. This Plan shall be governed, construed and administered in
accordance with the laws of the State of Delaware.
18.6. The Committee may require each person acquiring Shares pursuant
to Awards hereunder to represent to and agree with the Company in writing
that such person is acquiring the Shares without a view to distribution
thereof. The certificates for such Shares may include any legend which the
Committee deems appropriate to reflect any restrictions on transfer. All
certificates for Shares issued pursuant to this Plan shall be subject to
such stock transfer orders and other restrictions as the Committee may deem
advisable under the rules, regulations and other requirements of the
Securities and Exchange Commission, any stock exchange upon which the
Common Stock is then listed or interdealer quotation system upon which the
Common Stock is then quoted, and any applicable federal or state securities
laws. The Committee may place a legend or legends on any such certificates
to make appropriate reference to such restrictions.
18.7. The Company shall not be required to issue any certificate or
certificates for Shares with respect to Awards under this Plan, or record
any person as a holder of record of such
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Shares, without obtaining, to the complete satisfaction of the Committee, the
approval of all regulatory bodies deemed necessary by the Committee, and without
complying to the Board's or Committee's complete satisfaction, with all rules
and regulations, under federal, state or local law deemed applicable by the
Committee.
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