DELHAIZE AMERICA, INC.
2000 STOCK INCENTIVE PLAN
(As Adopted March 27, 2000)
DELHAIZE AMERICA, INC.
2000 STOCK INCENTIVE PLAN
1. Purpose.
The purpose of this Plan is to provide an
incentive to the employees, individuals who have accepted an
offer of employment, officers, consultants and eligible
directors of Delhaize America, Inc., a North Carolina
corporation (the "Company"), and thereby encourage them to
devote their abilities and industry to the success of the
Company's business enterprise. It is intended that this
purpose be achieved by extending to employees, individuals
who have accepted an offer of employment, officers,
consultants and directors of the Company and its
Subsidiaries an added long-term incentive for high levels of
performance and unusual efforts through the grant of
Incentive Stock Options, Nonqualified Stock Options and
Restricted Stock (as each term is herein defined).
2. Definitions.
For purposes of the Plan:
2.1. "Agreement" means the written agreement between the
Company and an Optionee or Grantee evidencing the grant of
an Option or Award and setting forth the terms and
conditions thereof.
2.2. "Award" means a grant of Restricted Stock.
2.3. "Board" means the Board of Directors of the Company.
2.4. "Change in Capitalization" means any increase or
reduction in the number of Shares, or any change (including,
but not limited to, a change in value) in the Shares or
exchange of Shares for a different number or kind of shares
or other securities of the Company or another corporation,
by reason of a reclassification, recapitalization, merger,
consolidation, reorganization, reincorporation, spin-off,
split-up, issuance of warrants or rights or debentures,
stock dividend, stock split or reverse stock split, cash
dividend, property dividend, combination or exchange of
shares, repurchase of shares, change in corporate structure
or otherwise.
2.5. "Code" means the Internal Revenue Code of 1986, as
amended.
2.6. "Committee" means the committee, as described in
Section 3.1, appointed by the Board from time to time to
administer the Plan and to perform the functions set forth
herein.
2.7. "Company" means Delhaize America, Inc.
2.8. "Director" means a director of the Company.
2.9. "Disability" means:
(a) in the case of an Optionee or Grantee whose
employment with the Company or a Subsidiary is subject
to the terms of an employment agreement between such
Optionee or Grantee and the Company or Subsidiary,
which employment agreement includes a definition of
"Disability," the term "Disability" as used in this
Plan or any Agreement shall have the meaning set forth
in such employment agreement during the period that
such employment agreement remains in effect; and
(b) in all other cases, the term "Disability" as
used in this Plan or any Agreement shall mean a
physical or mental infirmity which impairs the
Optionee's or Grantee's ability to perform
substantially his or her duties for a period of one
hundred eighty (180) consecutive days.
2.10. "Division" means any of the operating units or
divisions of the Company designated as a Division by the
Committee.
2.11. "EBITDA" means earnings before interest, taxes,
depreciation and amortization.
2.12. "Eligible Director" means a director of the
Company who is not an employee of the Company or any
Subsidiary.
2.13. "Eligible Individual" means any director (other
than an Eligible Director), officer, employee of the Company
or a Subsidiary or individual who has accepted an offer of
employment from the Company or a Subsidiary, or any
consultant of the Company or a Subsidiary, designated by the
Committee as eligible to receive Options or Awards subject
to the conditions set forth herein.
2.14. "Exchange Act" means the Securities Exchange Act
of 1934, as amended.
2.15. "Fair Market Value" on any date means the closing
sales price of the Shares on such date on the principal
national securities exchange on which such Shares are listed
or admitted to trading, or, if such Shares are not so listed
or admitted to trading, the average of the per Share closing
bid price and per Share closing asked price on such date as
quoted on the National Association of Securities Dealers
Automated Quotation System or such other market in which
such prices are regularly quoted, or, if there have been no
published bid or asked quotations with respect to Shares on
such date, the Fair Market Value shall be the value
established by the Board in good faith and, in the case of
an Incentive Stock Option, in accordance with Section 422 of
the Code.
2.16. "Grantee" means a person to whom an Award has been
granted under the Plan.
2.17. "Incentive Stock Option" means an Option
satisfying the requirements of Section 422 of the Code and
designated by the Committee as an Incentive Stock Option.
2.18. "Nonemployee Director" means a director of the
Company who is a "nonemployee director" within the meaning
of Rule 16b-3 promulgated under the Exchange Act.
2.19. "Nonqualified Stock Option" means an Option that
is not an Incentive Stock Option.
2.20. "Option" means a Nonqualified Stock Option or an
Incentive Stock Option or either or both of them.
2.21. "Optionee" means a person to whom an Option has
been granted under the Plan.
2.22. "Outside Director" means a director of the Company
who is an "outside director" within the meaning of Section
162(m) of the Code and the regulations promulgated
thereunder.
2.23. "Parent" means any corporation that is a parent
corporation (within the meaning of Section 424(e) of the
Code) with respect to the Company.
2.24. "Performance Cycle" means the time period
specified by the Committee at the time a performance-based
Award is granted during which the performance of the
Company, a Subsidiary or a Division will be measured.
2.25. "Performance Objectives" has the meaning set forth
in Section 6.4(b) hereof.
2.26. "Plan" means the Delhaize America, Inc. 2000
Stock Incentive Plan, as amended and restated from time to
time.
2.27. "Reload Option" means an Option that may be
granted when an Optionee pays all or a portion of the
purchase price and withholding taxes of an Option with
previously owned Shares.
2.28. "Restricted Stock" means Shares issued or
transferred to an Eligible Individual or Eligible Director
pursuant to Section 6 hereof.
2.29. "Shares" means the Class A common stock, par value
$0.50 per share, of the Company.
2.30. "Subsidiary" means any corporation that is a
subsidiary corporation (within the meaning of Section 424(f)
of the Code) with respect to the Company, including any
limited liability company that is disregarded for Federal
tax purposes or treated as a corporate subsidiary under the
Code.
2.31. "Ten-Percent Stockholder" means an Eligible
Individual, who, at the time an Incentive Stock Option is to
be granted to him or her, owns (within the meaning of
Section 422(b)(6) of the Code) stock possessing more than
ten percent (10%) of the total combined voting power of all
classes of stock of the Company, or of a Parent or a
Subsidiary.
3. Administration.
3.1. The authority to control and manage the operation and
administration of the Plan shall be vested in the Committee,
which shall hold meetings at such times as may be necessary
for the proper administration of the Plan. The Committee
shall keep minutes of its meetings. A quorum shall consist
of a majority of the members of the Committee, and a
majority of a quorum may authorize any action. The
foregoing notwithstanding, with respect to Options or Awards
that: (i) are intended to qualify as "performance-based"
under Section 162(m) of the Code, and/or (ii) are granted to
individuals who qualify as "insiders" under Section 16 of
the Exchange Act, (A) any Committee members who do not
qualify as "Outside Directors" and/or "Nonemployee
Directors," as the case may be, shall have no authority to
act and shall automatically be recused from any action with
respect to Options or Awards, and (B) the remaining
qualifying directors shall be authorized to act
independently without further approval. No member of the
Committee shall be liable for any action, failure to act,
determination or interpretation made in good faith with
respect to this Plan or any transaction hereunder, except
for liability arising from his or her own willful
misfeasance, gross negligence or reckless disregard of his
or her duties. The Company hereby agrees to indemnify each
member of the Committee for all costs and expenses and, to
the extent permitted by applicable law, any liability
incurred in connection with defending against, responding
to, negotiating for the settlement of or otherwise dealing
with any claim, cause of action or dispute of any kind
arising in connection with any actions in administering this
Plan or in authorizing or denying authorization to any
transaction hereunder. Notwithstanding the foregoing, if the
Committee does not exist, or for any other reason determined
by the Board, the Board may take any action under the Plan
that would otherwise be the responsibility of the Committee;
provided, however, that if any members of the Board do not
qualify as Outside Directors, only the Committee appointed
above may grant Options or Awards that are intended to be
performance-based under Section 162(m).
3.2. Subject to the express terms and conditions set forth
herein, the Committee shall have the power from time to time
to:
(a) determine those Eligible Individuals and
Eligible Directors to whom Options shall be granted
under the Plan and the number of such Options to be
granted and to prescribe the terms and conditions
(which need not be identical) of each such Option,
including the purchase price per Share subject to each
Option, and make any amendment or modification to any
Option Agreement consistent with the terms of the
Plan;
(b) select those Eligible Individuals and
Eligible Directors to whom Awards shall be granted
under the Plan and determine the number of Shares to
be granted pursuant thereto, determine the terms and
conditions of each Award including the restrictions or
Performance Objectives relating to Shares, and to make
any amendment or modification to any Agreement
consistent with the terms of the Plan;
(c) construe and interpret the Plan, Options and
Awards granted hereunder and to establish, amend and
revoke rules and regulations for the administration of
the Plan, including, but not limited to, correcting
any defect or supplying any omission, or reconciling
any inconsistency in the Plan or in any Agreement, in
the manner and to the extent it shall deem necessary
or advisable so that the Plan complies with applicable
law including Rule 16b-3 under the Exchange Act and
the Code to the extent applicable, and otherwise to
make the Plan fully effective. All decisions and
determinations by the Committee in good faith in the
exercise of this power shall be final, binding and
conclusive upon the Company, its Subsidiaries, the
Optionees and Grantees, and all other persons having
any interest therein;
(d) determine the duration and purposes for
leaves of absence which may be granted to an Optionee
or Grantee on an individual basis without constituting
a termination of employment or service for purposes of
the Plan;
(e) exercise its discretion with respect to the
powers and rights granted to it as set forth in the
Plan;
(f) except to the extent prohibited by
applicable law or the applicable rules of a stock
exchange, the Committee may allocate all or any part
of its responsibilities and powers to any one or more
of its members and may delegate all or any part of its
responsibilities and powers to any person or persons
selected by it, which allocation or delegation may be
revoked by the Committee at any time; and
(g) generally, to exercise such powers and to
perform such acts as are deemed necessary or advisable
to promote the best interests of the Company with
respect to the Plan.
4. Stock Subject to the Plan.
4.1. The Shares subject to Options and Awards that shall be
reserved for the purposes of the Plan, shall be from the
Company's authorized but unissued Shares or out of Shares
held in the Company's treasury, or partly out of each, such
number of Shares as shall be determined by the Board. An
aggregate of 8,000,000 Shares may be issued or transferred
pursuant to this Plan plus the number of Shares that have
not been awarded under the 1996 Employee Stock Incentive
Plan of Food Lion, Inc. (the "1996 Plan") as of the
Effective Date (including those that may be forfeited or
cancelled under the 1996 Plan after the effective date of
this Plan).
No employee shall be granted in any calendar year
Options to purchase more than 400,000 Common Shares.
No Eligible Individual may be awarded more than 150,000
Shares of Restricted Stock that are intended to be
performance-based compensation in any calendar year.
No more than 8,000,000 Shares shall be granted pursuant
to Options intended to be Incentive Stock Options.
In the event of a Change in Capitalization, the Board
or Committee shall conclusively determine the appropriate
adjustments, if any, to (i) the maximum number of Shares
with respect to which Options and Awards may be granted,
(ii) the maximum number of Shares or other stock or
securities with respect to which Options or Awards may be
granted in any calendar year, (iii) the maximum number of
Shares which may be granted pursuant to Incentive Stock
Options, (iv) the number of Shares or other stock or
securities which are subject to outstanding Options or
Awards and the purchase price therefor, if applicable, and
(v) the Performance Objectives.
In connection with the grant of an Option or an Award,
the number of Shares available for grant under the Plan
shall be reduced by the number of Shares in respect of which
the Option or Award is granted.
4.2. Whenever any outstanding Option or Award or portion
thereof expires, is canceled or is otherwise terminated for
any reason without having been exercised or without payment
having been made in respect of the entire Option or Award,
the Shares allocable to the expired, canceled or otherwise
terminated portion of the Option or Award may again be the
subject of Options or Awards granted hereunder.
4.3. Whenever any portion of an Option under this Plan or
the 1996 Plan is paid for with previously held Shares (by
either actual delivery or attestation), only the difference
between (i) the number of Shares issued upon exercise and
(ii) the number of Shares transferred in payment of the
purchase price shall be counted for purposes of determining
the maximum number of Shares available for grant under the
Plan.
5. Option Grants.
5.1. Authority of Committee. Subject to the provisions of
the Plan, the Committee, or the persons to whom authority
has been delegated under Paragraph (f) of Section 3.2
hereof, shall have full and final authority to select those
Eligible Individuals and Eligible Directors who will receive
Options, and the terms and conditions that shall be set
forth in the applicable Agreements. Some terms and
conditions that may, but are not required to be included
are: a provision allowing the issuance of a Reload Option
and a provision providing acceleration of exercisability
under certain conditions as may be determined by the
Committee. Other terms and conditions not inconsistent with
this Plan may be included in Agreements in the discretion of
the Committee.
5.2. Purchase Price. The purchase price or the manner in
which the purchase price is to be determined for Shares
under each Option shall be determined by the Committee and
set forth in the Agreement; provided, however, that the
purchase price per Share under each Incentive Stock Option
shall not be less than 100% of the Fair Market Value of a
Share on the date the Option is granted (110% in the case of
an Incentive Stock Option granted to a Ten-Percent Stockholder).
5.3. Maximum Duration. Options granted hereunder shall be
for such term as the Committee shall determine, provided
that an Incentive Stock Option shall not be exercisable
after the expiration of ten (10) years from the date it is
granted (five (5) years in the case of an Incentive Stock
Option granted to a Ten-Percent Stockholder) and a
Nonqualified Stock Option shall not be exercisable after the
expiration of ten (10) years from the date it is granted.
The Committee may, subsequent to the granting of any Option,
extend the term thereof, but in no event shall the term as
so extended exceed the maximum term provided for in the
preceding sentence.
5.4. Vesting. Each Option shall become exercisable in such
installments (which need not be equal) and at such times as
may be designated by the Committee and set forth in the
Agreement. To the extent not exercised, installments shall
accumulate and be exercisable, in whole or in part, at any
time after becoming exercisable, but not later than the date
the Option expires. The Committee may accelerate the
exercisability of any Option or portion thereof at any time.
5.5. Modification. No modification of an Option shall
adversely alter or impair any rights or obligations under
the Option without the Optionee's consent.
5.6. Non-Transferability. Unless set forth in the Agreement
evidencing the Option (other than an Incentive Stock Option)
at the time of grant or at any time thereafter, an Option
granted hereunder shall not be transferable by the Optionee
to whom granted except by will or the laws of descent and
distribution or pursuant to a domestic relations order
(within the meaning of Rule 16a-12 promulgated under the
Exchange Act), and an Option may be exercised during the
lifetime of such Optionee only by the Optionee or his or her
guardian or legal representative. The terms of such Option
shall be final, binding and conclusive upon the
beneficiaries, executors, administrators, heirs and
successors of the Optionee.
5.7. Method of Exercise. The exercise of an Option shall be
made only by a written notice delivered in person or by mail
to the Secretary of the Company at the Company's principal
executive office, specifying the number of Shares to be
purchased and accompanied by payment therefor and otherwise
in accordance with the Agreement pursuant to which the
Option was granted. The purchase price for any Shares
purchased pursuant to the exercise of an Option shall be
paid, as determined by the Committee in its discretion, in
either of the following forms (or any combination thereof):
(i) cash or (ii) the transfer or attestation of Shares that
have been held at least six months to the Company upon such
terms and conditions as determined by the Committee. In
addition, Options may be exercised through a registered
broker-dealer pursuant to such cashless exercise procedures
(other than Share withholding) which are, from time to time,
deemed acceptable by the Committee, and the Committee may
authorize that the purchase price payable upon exercise of
an Option may be paid by having Shares withheld that
otherwise would be acquired upon such exercise. Any Shares
transferred to the Company (or withheld upon exercise) as
payment of the purchase price under an Option shall be
valued at their Fair Market Value on the date of exercise of
such Option. The value of the number of Shares that may be
withheld for the payment of taxes may not be in excess of
the minimum withholding requirements. At the Company's
request, the Optionee shall deliver the Agreement evidencing
the Option to the Secretary of the Company who shall endorse
thereon a notation of such exercise and return such
Agreement to the Optionee. No fractional Shares (or cash in
lieu thereof) shall be issued upon exercise of an Option and
the number of Shares that may be purchased upon exercise
shall be rounded to the nearest number of whole Shares. The
Committee, in its discretion, may also permit simultaneous
sale of Shares upon exercise through a broker-dealer.
5.8. Rights of Optionees. Optionee shall not be deemed for
any purpose to be the owner of any Shares subject to any
Option unless and until (i) the Option shall have been
exercised pursuant to the terms thereof, (ii) the Company
shall have issued and delivered Shares to the Optionee, and
(iii) the Optionee's name shall have been entered as a
stockholder of record on the books of the Company.
Thereupon, the Optionee shall have full voting, dividend and
other ownership rights with respect to such Shares, subject
to such terms and conditions as may be set forth in the
applicable Agreement.
6. Restricted Stock.
6.1. Grant. The Committee may grant Awards to Eligible
Individuals and Eligible Directors, which shall be evidenced
by an Agreement between the Company and the Grantee. Each
Agreement shall contain such restrictions, terms and
conditions as the Committee may, in its discretion,
determine and (without limiting the generality of the
foregoing) such Agreements may require that an appropriate
legend be placed on Share certificates. Awards shall be
subject to the terms and provisions set forth below in this
Section 6.
6.2. Rights of Grantee. Shares of Restricted Stock granted
pursuant hereunder shall be recorded in the name of the
Grantee as soon as reasonably practicable after the Award is
granted provided that the Grantee has executed an Agreement
evidencing the Award and any other documents which the
Committee may require as a condition to the issuance of such
Shares. If a Grantee shall fail to execute the Agreement
evidencing an Award or any other documents which the
Committee may require within the time period prescribed by
the Committee at the time the Award is granted, the Award
shall be null and void. Unless the Committee determines
otherwise and as set forth in the Agreement, the Grantee
shall have no rights of a stockholder with respect to such
Shares, including no right to vote the Shares or receive
dividends or other distributions with respect to the Shares,
until the restrictions with respect to such Shares shall
have lapsed in the manner set forth in Section 6.4.
6.3. Non-transferability. Until all restrictions upon the
Shares of Restricted Stock awarded to a Grantee shall have
lapsed in the manner set forth in Section 6.4, such Shares
shall not be sold, transferred or otherwise disposed of and
shall not be pledged or otherwise hypothecated, nor shall
they be delivered to the Grantee.
6.4. Lapse of Restrictions.
(a) Generally. Restrictions upon Shares of
Restricted Stock awarded hereunder shall lapse at such
time or times and on such terms and conditions as the
Committee may determine. The Agreement evidencing the
Award shall set forth any such restrictions. The
Board may accelerate the lapse of all or a portion of
the restrictions on an Award at any time.
(b) Performance Objectives. If the Committee
has determined that the restrictions on Shares of
Restricted Stock awarded shall only lapse in
accordance with Performance Objectives, the
Performance Objectives may be expressed in terms of
(i) earnings per Share, (ii) Share price, (iii) pre-
tax profits, (iv) net earnings, (v) return on equity
or assets, (vi) revenues, (vii) EBITDA, (viii) market
share or market penetration or (ix) any combination of
the foregoing. Performance Objectives may be in
respect of the performance of the Company and its
Subsidiaries (which may be on a consolidated basis), a
Subsidiary or a Division. Performance Objectives may
be absolute or relative and may be expressed in terms
of a progression within a specified range. The
Performance Objectives with respect to a Performance
Cycle shall be established in writing by the Committee
by the earlier of (i) the date on which a quarter of
the Performance Cycle has elapsed or (ii) the date
which is ninety (90) days after the commencement of
the Performance Cycle, and in any event while the
performance relating to the Performance Objectives
remain substantially uncertain. At the time of grant
of a performance-base Award, and to the extent
permitted under Section 162(m) of the Code and the
regulations thereunder, the Committee may provide for
the manner in which the Performance Objectives will be
measured to reflect the impact of specified corporate
transactions, extraordinary events, accounting changes
and other similar events. Prior to the vesting,
payment, settlement or lapsing of any restrictions
with respect to any Award that is intended to be
performance-based compensation, made to a Grantee who
is subject to Section 162(m) of the Code, the
Committee shall certify in writing that the applicable
Performance Objectives have been satisfied.
6.5. Delivery of Shares. Upon the lapse of the restrictions
on Shares of Restricted Stock, the Committee shall cause a
stock certificate to be delivered to the Grantee with
respect to such Shares, free of all restrictions hereunder.
7. Effect of a Termination of Employment.
The Agreement evidencing the grant of each Option
and each Award shall set forth the terms and conditions
applicable to such Option or Award upon a termination or
change in the status of the employment of the Optionee or
Grantee by the Company, a Subsidiary or a Division which
shall be as the Committee may, in its discretion, determine
at the time the Option or Award is granted or thereafter.
8. Adjustment Upon Changes in Capitalization.
8.1. Adjustments to Incentive Stock Options. Any adjustment
that may be made pursuant to Section 4.1 hereof in the
Shares or other stock or securities subject to outstanding
Incentive Stock Options upon a Change in Capitalization,
(including any adjustments in the purchase price) shall be
made in such manner as not to constitute a modification as
defined by Section 424(h)(3) of the Code and only to the
extent otherwise permitted by Sections 422 and 424 of the
Code.
8.2. Terms of Adjusted Options and Awards. If, by reason of
a Change in Capitalization, a Grantee of an Award shall be
entitled to, or an Optionee shall be entitled to exercise an
Option with respect to, new, additional or different shares
of stock or securities, such new, additional or different
shares shall thereupon be subject to all of the conditions,
restrictions and performance criteria which were applicable
to the Shares subject to the Award or Option, as the case
may be, prior to such Change in Capitalization.
9. Effect of Certain Transactions.
Except as otherwise provided in an Agreement, in
the event of (i) the liquidation or dissolution of the
Company or (ii) a merger or consolidation of the Company (a
"Transaction"), the Plan and the Options and Awards issued
hereunder shall continue in effect in accordance with their
respective terms, except that following a Transaction each
Optionee and Grantee shall be entitled to receive in respect
of each Share subject to any outstanding Options or Awards,
as the case may be, upon exercise of any Option or payment
or transfer in respect of any Award, the same number and
kind of stock, securities, cash, property or other
consideration that each holder of a Share was entitled to
receive in the Transaction in respect of a Share; provided,
however, that such stock, securities, cash, property or
other consideration shall remain subject to all of the
conditions, restrictions and performance criteria which were
applicable to the Options and Awards prior to such
Transaction.
10. Interpretation.
10.1. Rule 16b-3. The Plan is intended to comply with
Rule 16b-3 promulgated under the Exchange Act, and the
Committee shall interpret and administer the provisions of
the Plan or any Agreement in a manner consistent therewith.
Any provisions inconsistent with such Rule shall be
inoperative and shall not affect the validity of the Plan.
10.2. Section 162(m). Unless otherwise expressly stated
in the relevant Agreement, each Option and Award subject to
Performance Objectives granted to an Eligible Individual who
may be a "covered employee" under Section 162(m) of the Code
is intended to be performance-based compensation within the
meaning of Section 162(m)(4)(C) of the Code. The Committee
shall not be entitled to exercise any discretion otherwise
authorized hereunder with respect to any such Options or
Awards if the ability to exercise such discretion or the
exercise of such discretion itself would cause the
compensation attributable to such Options or Awards to fail
to qualify as performance-based compensation.
11. Termination and Amendment of the Plan.
The Plan shall terminate on the day preceding the
tenth anniversary of the date of its adoption by the Board
and no Option or Award may be granted thereafter. The Board
may sooner terminate the Plan and the Board may at any time
and from time to time amend, modify or suspend the Plan;
provided, however, that: (a) no such amendment,
modification, suspension or termination shall impair or
adversely alter any Options or Awards theretofore granted
under the Plan, except with the consent of the Optionee or
Grantee, nor shall any amendment, modification, suspension
or termination deprive any Optionee or Grantee of any Shares
which he or she may have acquired through or as a result of
the Plan; and (b) to the extent necessary under applicable
law, no amendment shall be effective unless approved by the
stockholders of the Company in accordance with applicable
law.
12. Non-Exclusivity of the Plan.
The adoption of the Plan by the Board shall not be
construed as amending, modifying or rescinding any
previously approved incentive arrangement or as creating any
limitations on the power of the Board to adopt such other
incentive arrangements as it may deem desirable, including,
without limitation, the granting of stock options otherwise
than under the Plan, and such arrangements may be either
applicable generally or only in specific cases.
13. Limitation of Liability.
As illustrative of the limitations of liability of
the Company, but not intended to be exhaustive thereof,
nothing in the Plan shall be construed to:
(i) give any person any right to be
granted an Option or Award other than at the
sole discretion of the Committee;
(ii) give any person any rights
whatsoever with respect to Shares except as
specifically provided in the Plan;
(iii) limit in any way the right of
the Company or any Subsidiary to terminate
the employment of any person at any time; or
(iv) be evidence of any agreement or
understanding, expressed or implied, that the
Company will employ any person at any
particular rate of compensation or for any
particular period of time.
14. Regulations and Other Approvals; Governing Law.
14.1. Except as to matters of federal law, the Plan and
the rights of all persons claiming hereunder shall be
construed and determined in accordance with the laws of the
State of North Carolina without giving effect to conflicts
of laws principles thereof.
14.2. The obligation of the Company to sell or deliver
Shares with respect to Options and Awards granted under the
Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state
securities laws, and the obtaining of all such approvals by
governmental agencies as may be deemed necessary or
appropriate by the Committee.
14.3. The Board may make such changes as may be
necessary or appropriate to comply with the rules and
regulations of any government authority, or to obtain for
Eligible Individuals granted Incentive Stock Options the tax
benefits under the applicable provisions of the Code and
regulations promulgated thereunder.
14.4. Each Option and Award is subject to the
requirement that, if at any time the Committee determines,
in its discretion, that the listing, registration or
qualification of Shares issuable pursuant to the Plan is
required by any securities exchange or under any state or
federal law, or the consent or approval of any governmental
regulatory body is necessary or desirable as a condition of,
or in connection with, the grant of an Option or Award or
the issuance of Shares, no Options or Awards shall be
granted or payment made or Shares issued, in whole or in
part, unless listing, registration, qualification, consent
or approval has been effected or obtained free of any
conditions as acceptable to the Committee.
14.5. Notwithstanding anything contained in the Plan or
any Agreement to the contrary, in the event that the
disposition of Shares acquired pursuant to the Plan is not
covered by a then current registration statement under the
Securities Act of 1933, as amended (the "Securities Act"),
and is not otherwise exempt from such registration, such
Shares shall be restricted against transfer to the extent
required by the Securities Act and Rule 144 or other
regulations thereunder. The Committee may require any
individual receiving Shares pursuant to an Option or Award
granted under the Plan, as a condition precedent to receipt
of such Shares, to represent and warrant to the Company in
writing that the Shares acquired by such individual are
acquired without a view to any distribution thereof and will
not be sold or transferred other than pursuant to an
effective registration thereof under said Act or pursuant to
an exemption applicable under the Securities Act or the
rules and regulations promulgated thereunder. The
certificates evidencing any of such Shares shall be
appropriately amended to reflect their status as restricted
securities as aforesaid.
15. Miscellaneous.
15.1. Multiple Agreements. The terms of each Option or
Award may differ from other Options or Awards granted under
the Plan at the same time, or at some other time. The
Committee may also grant more than one Option or Award to a
given Eligible Individual or Eligible Director during the
term of the Plan, either in addition to, or in substitution
for, one or more Options or Awards previously granted to
that Eligible Individual or Eligible Director.
15.2. Withholding of Taxes.
(a) At such times as an Optionee or Grantee
recognizes taxable income in connection with the
receipt of Shares or cash hereunder (a "Taxable
Event"), the Optionee or Grantee shall pay to the
Company an amount equal to the federal, state and
local income taxes and other amounts as may be
required by law to be withheld by the Company in
connection with the Taxable Event (the "Withholding
Taxes") prior to the issuance of such Shares or the
payment of such cash. The Company shall have the
right to deduct from any payment of cash to an
Optionee or Grantee an amount equal to the Withholding
Taxes in satisfaction of the obligation to pay
Withholding Taxes. In satisfaction of the obligation
to pay Withholding Taxes to the Company, the Optionee
or Grantee may make a written election (the "Tax
Election"), which may be accepted or rejected in the
discretion of the Committee, to have withheld a
portion of the Shares then issuable to him or her
having an aggregate Fair Market Value equal to the
Withholding Taxes.
(b) If an Optionee makes a disposition, within
the meaning of Section 424(c) of the Code and
regulations promulgated thereunder, of any Share or
Shares issued to such Optionee pursuant to the
exercise of an Incentive Stock Option within the two-
year period commencing on the day after the date of
the grant or within the one-year period commencing on
the day after the date of transfer of such Share or
Shares to the Optionee pursuant to such exercise, the
Optionee shall, within ten (10) days of such
disposition, notify the Company thereof, by delivery
of written notice to the Company at its principal
executive office.
15.3. Effective Date. The effective date of this Plan
(the "Effective Date") shall be March 27, 2000 subject only
to the approval by the affirmative vote of the holders of a
majority of the securities of the Company present, or
represented, and entitled to vote at a meeting of
stockholders duly held in accordance with the applicable
laws of the State of North Carolina within twelve (12)
months of the adoption of the Plan by the Board.
