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EXHIBIT 4.1
INDYMAC MORTGAGE HOLDINGS, INC.
2000 STOCK INCENTIVE PLAN
1. Purpose of Plan. The purpose of this 2000 Stock Incentive Plan
("Plan") of IndyMac Mortgage Holdings, Inc., a Delaware corporation (the
"Company"), is to enable the Company and any of its subsidiaries or affiliates
to attract, retain and motivate their employees, consultants, agents, officers
and directors by providing incentives related to equity interests in and the
financial performance of the Company.
2. Persons Eligible Under Plan. Any person, including any director of the
Company or any of its subsidiaries or affiliates, who is an officer or employee
of the Company or any of its subsidiaries or affiliates or an individual who
performs services for the Company or any of its subsidiaries or affiliates of a
nature similar to those performed by officers or employees, such as consultants
and agents (any of the foregoing, an "Employee") shall be eligible to be
considered for the grant of an Award (as defined in Section 5 below) or Awards
under Section 5 of this Plan. Members of the Board of Directors of the Company
(the "Board"), and members of the boards of directors of any of the Company's
subsidiaries or affiliates who are not officers or employees of the Company or
any of its subsidiaries or affiliates ("Non-Employee Directors") shall be
eligible to receive Awards under this Plan only in the form of nonqualified
stock options granted automatically under the provisions of Section 10 of this
Plan ("Director Options").
3. Stock Subject to Plan.
(a) ISO Limit. The maximum number of Common Shares, $0.01 par value
per share, of the Company (the "Common Shares") that may be issued pursuant
to options intended to qualify as incentive stock options ("Incentive Stock
Options") under Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), granted under this Plan is 5,000,000, and provided
further that, except as otherwise provided herein, the aggregate Fair
Market Value (as defined in Section 10) of Common Shares with respect to
which options intended to qualify as Incentive Stock Options are
exercisable for the first time by any individual during any calendar year
shall not exceed the limit, if any, set forth in Section 422(d) of the Code
or any successor provision thereto. For purposes of this subsection (a),
the Fair Market Value (as defined in Section 10) of any Common Shares shall
be determined as of the time the Incentive Stock Option with respect to the
Common Shares is granted. Pursuant to Section 422(a)(2) of the Code, only
employees (as that term is used in Section 422(a)(2) of the Code) of the
Company or the Company's wholly-owned subsidiaries may receive options
intended to qualify as Incentive Stock Options under this Plan.
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(b) Aggregate/Individual Share Limit.
(i) The maximum number of Common Shares that may be issued
pursuant to all Awards (including Incentive Stock Options, as set
forth in subsection (a) above) granted under this Plan, other
than Common Shares that are issued pursuant to Awards and
subsequently reacquired by the Company pursuant to the terms and
conditions of such Awards ("Reacquired Common Shares"), is
5,000,000, subject to adjustment as provided in or pursuant to
Section 6 or 10 hereof (such maximum number, as so adjusted,
shall be referred to as the "Share Limit").
(ii) Notwithstanding anything contained herein to the
contrary, the aggregate number of Common Shares subject to
options, stock appreciation rights, and awards of restricted
stock granted during any calendar year to any individual shall be
limited to 1,000,000.
(c) Share Reservation. No Award may be granted under this Plan
unless, on the date of grant, the sum of (i) the maximum number of
Common Shares issuable at any time pursuant to such Award, plus (ii)
the number of Common Shares that have previously been issued pursuant
to Awards granted under this Plan, other than Reacquired Common Shares
available for reissue, plus (iii) the maximum number of Common Shares
that may be issued at any time after such date of grant pursuant to
Awards that are outstanding on such date, does not exceed the Share
Limit. Common Shares distributed under the Plan may be treasury
shares, authorized but unissued shares or shares purchased in the open
market for this purpose.
(d) Reissue of Awards and Common Shares. Awards payable in cash
or Common Shares that are forfeited or for any reason are not so paid
under this Plan, as well as Common Shares subject to Awards that
expire or for any reason are terminated and are not issued or
constitute Reacquired Common Shares, shall again be available for
subsequent Awards under the Plan.
(e) Fractional Shares/Minimum Issue. Fractional share interests
shall be disregarded, but may be accumulated. No fewer than 100 Common
Shares may be purchased on exercise of any option granted under this
Plan ("Option") at one time unless the number purchased is the total
number at the time available for purchase under the Option.
(f) Privileges of Stock Ownership. Except as otherwise expressly
authorized by this Plan, an Award recipient shall not be entitled to
any privilege of stock ownership as to any Common Shares subject to an
Option granted under this Plan prior to the satisfaction of all
conditions to the valid exercise of the Option.
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4. Administration of Plan.
(a) The Committee. Except for the provisions of Section 10 (which to
the maximum extent feasible shall be self-effectuating), this Plan shall be
administered by a committee of the Board (the "Committee") consisting of
two or more directors, each of whom is a "Non-Employee Director," as such
term is defined in Rule 16b-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and an "Outside Director," as such term is
defined for purposes of Section 162(m) of the Code.
(b) Powers of the Committee. Subject to the express provisions of
this Plan, the Committee shall be authorized and empowered to do all things
necessary or desirable in connection with the administration of this Plan
including, without limitation, the following:
(i) adopt, amend and rescind rules and regulations relating to
this Plan;
(ii) determine which persons meet the requirements of Section 2
hereof for eligibility under this Plan and to which of such eligible
persons, if any, Awards will be granted hereunder;
(iii) grant Awards to eligible persons and determine the terms
and conditions thereof, including, but not limited to, the number of
Common Shares issuable pursuant thereto, the time not more than ten
(10) years after the date of an Award at which time the Award shall
expire or (if not vested) terminate, and the conditions upon which
Awards become exercisable or vest or shall expire or terminate, and
the consideration, if any, to be paid upon receipt, exercise or
vesting of Awards;
(iv) determine whether, and the extent to which, adjustments are
required pursuant to Section 6 hereof;
(v) interpret and construe this Plan and the terms and
conditions of any Award granted under Section 5, whether before or
after the date set forth in Section 7; and
(vi) determine the circumstances under which, consistent with the
provisions of Section 7, any outstanding Award under Section 5 may be
amended;
which authority (except as to clauses (ii) and (iii) above) shall remain in
effect so long as any Award remains outstanding under this Plan.
(c) Specific Committee Responsibility and Discretion Regarding
Awards. Subject to the express provisions of this Plan, the Committee, in
its sole
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and absolute discretion, shall determine all of the terms and conditions of
each Award granted under Section 5 of this Plan, which terms and conditions
may include, subject to such limitations as the Committee may from time to
time impose, among other things, provisions that:
(i) permit the recipient of such Award, including any recipient
who is a director or officer of the Company, to pay the purchase price
of the Common Shares or other property issuable pursuant to such
Award, or such recipient's tax withholding obligation upon such
issuance or in respect of such Award or Shares, in whole or in part,
by any one or more of the following:
(A) the delivery of previously owned shares of capital
stock of the Company (including shares acquired as or pursuant to
Awards) then having been owned by the recipient for at least six
(6) months (or such other period required under applicable law)
or the delivery of other property, or
(B) the delivery of a promissory note, under any applicable
financing plan or on such other terms and conditions, as in
either case authorized by the Committee, consistent with
applicable law;
(ii) accelerate the receipt of benefits pursuant to such Award
upon the occurrence of specified events, including, without
limitation, a change of control of the Company, an acquisition of a
specified percentage of the voting power of the Company, the
dissolution or liquidation of the Company, a sale of substantially all
of the property and assets of the Company or an event of the type
described in Section 6 hereof, or pursuant to the provisions of an
employment contract not inconsistent with the terms of this Plan, or
in other circumstances or upon the occurrence of other events as
deemed appropriate by the Committee;
(iii) qualify such Award as an Incentive Stock Option;
(iv) extend the exercisability or term of any or all such
outstanding Awards, change the price of any or all such outstanding
Awards or otherwise change previously imposed terms and conditions, in
the specified events described in clause (ii) above or in other
circumstances or upon the occurrence of other events as deemed
appropriate by the Committee, in each case subject to Section 7;
(v) authorize the conversion, succession or substitution of
outstanding Awards under Section 5 upon the occurrence of any event of
the type described in Section 6, or in other circumstances or upon the
occurrence of other events as deemed appropriate by the Committee;
and/or
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(vi) provide for automatic grants of Awards or successive Awards.
(d) Binding Determinations. Any action taken by, or inaction of, the
Company, the Board or the Committee relating or pursuant to this Plan shall
be within the absolute discretion of that entity or body and shall be
conclusive and binding upon all persons. No member of the Board or officer
of the Company shall be liable for any such action or inaction of the
entity or body, of another person or, except in circumstances involving bad
faith, of himself or herself.
(e) Reliance on Experts. In making any determination or in taking or
not taking any action under this Plan, the Board and the Committee may
obtain and may rely upon the advice of experts, including professional
advisors to the Company. No director, officer or agent of the Company shall
be liable for any such action or determination taken or made or omitted in
good faith.
(f) Delegation. The Committee may delegate ministerial,
non-discretionary functions to individuals who are officers or employees of
the Company. The Committee also may delegate to certain officer(s) of the
Company the authority to grant Awards pursuant to Section 5 of the Plan,
provided that such delegation is set forth in writing and includes all
applicable limitations and parameters to such Awards, and provided further
that such Awards are subsequently ratified by the Committee.
5. Awards.
(a) Types of Awards. The Committee, on behalf of the Company, is
authorized under this Plan to enter into any type of arrangement with an
Employee that is not inconsistent with the provisions of this Plan and that
by its terms, involves or might involve the issuance of (i) Common Shares,
(ii) an option, warrant, convertible security, stock appreciation right or
similar right with an exercise or conversion privilege at a fixed or
variable price related to the Common Shares or other equity securities of
the Company and/or the passage of time, the occurrence of one or more
events, or the satisfaction of performance criteria or other conditions, or
any combination of these variables, or any similar security contemplated by
subsection (b) below, or (iii) any similar security with a value derived
from the value of the Common Shares or other equity securities of the
Company, all of which may or may not involve the payment of cash
consideration, subject to subsection (e) below. The authorization of any
such arrangement (including any benefits described in Section 5(e)) is
referred to herein as the grant of an "Award". The date of grant may be at
or after (but not before) the date the Committee authorizes the Award. All
Awards shall be evidenced by a writing with a schedule memorializing the
grant of the Award to the recipient and setting forth certain specifics
with respect to the terms and conditions of the Award ("Award Memorandum").
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(b) Form of Awards. Awards are not restricted to any specified form
or structure and may include, without limitation, sales or bonuses of
stock, restricted stock, performance restricted stock, stock options,
reload stock options, stock purchase warrants, other rights to acquire
stock, securities convertible into or redeemable for stock, stock
appreciation rights, limited stock appreciation rights, phantom stock,
dividend equivalents, performance units or performance shares, and an Award
may consist of one such security or benefit, or two or more of them in any
combination or alternative. In addition, any Award that is intended to
qualify as an Incentive Stock Option will automatically be converted into a
non-qualified stock option to the extent that such Award does not satisfy
any applicable requirement under Section 422 of the Code.
(c) Restricted Stock Awards. If expressly provided by the Committee,
and without limiting subsection (b) above, Awards of restricted Common
Shares ("Restricted Stock") may be made to the holder of any Option, based
upon dividends or distributions that would have been received had the
Common Shares covered by the Option been issued and outstanding on the
applicable dividend record date. The terms and conditions of any such
Awards of Restricted Stock shall be determined by the Committee and set
forth in the applicable Award Memorandum.
(d) Time and Method of Exercise. Awards may be exercised in whole or
in part at such time or times as shall be determined by the Committee and
set forth in the applicable Award Memorandum. Awards shall be exercised in
accordance with procedures established by the Committee, subject to Section
4(c)(i) and any holding periods required under applicable law.
(e) Price; Consideration; Option Pricing Limit. Common Shares may be
issued pursuant to an Award for any lawful consideration as determined by
the Committee, including, without limitation, cash, Common Shares (valued
at then Fair Market Value, as defined in Section 10), or services rendered
by the recipient of such Award; provided that no Common Shares shall be
issued for less than the minimum lawful consideration and no Option which
is intended to be an Incentive Stock Option shall be granted with an
exercise price that is less than the Fair Market Value (as defined in
Section 10) of the underlying Common Shares on the date of grant.
(f) Effect of Termination of Service or Death; Change in Subsidiary
Status. Subject to Section 4(c)(ii), and except as otherwise provided in
the applicable Award Memorandum or otherwise specified or approved by the
Committee, each Option and all other rights thereunder, to the extent not
exercised (whether or not presently exercisable), shall terminate and
become null and void at such time as the holder of such Option terminates
service as an Employee, except that:
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(i) if the holder terminates service as an Employee for a reason
other than cause (as determined by the Committee in its sole
discretion), death or permanent and total disability (as defined in
clause (ii) below), the holder may at any time within a period of
three months after such termination exercise such Option to the extent
such Option was exercisable on the date of such termination;
(ii) if the holder terminates service as an Employee by reason of
permanent and total disability (within the meaning of Section 22(e)(3)
of the Code), or if the holder becomes permanently and totally
disabled within three months after termination described in clause
(i), the holder may at any time within a period of twelve (12) months
after such termination exercise such Option to the extent such Option
was exercisable on the date of such termination; and
(iii) if the holder terminates service as an Employee by reason
of death, or within three months after a termination described in
clauses (i) or (ii), then such Option may be exercised within a period
of twelve (12) months after the holder's termination of service as an
Employee, to the extent such Option was exercisable on the date of
such termination;
provided, however, that in no event may any such Option be exercised by any
holder after its expiration date.
Notwithstanding any of the foregoing provisions of this subsection
(f), if the holder of an Option is an Employee of an entity which is a
subsidiary or affiliate of the Company and such entity ceases to be such a
subsidiary or affiliate of the Company, such event shall be deemed for
purposes of this subsection (f) to be a termination of the holder's service
as an Employee described in clause (i) above. Absence from work caused by
military service or authorized sick leave shall not be considered a
termination of service as an Employee for purposes of this subsection (f).
(g) Cash Awards; Loans. The Committee shall have the express
authority to create, add or include a cash payment or benefit under this
Plan, whether in lieu of, in addition to or as an Award or as a component
of another type of Award, and to make or authorize loans to finance, or to
otherwise accommodate the financing, acquisition or exercise of an Award or
the satisfaction of any related tax liability.
(h) Transfer Restrictions. Unless otherwise permitted in the
applicable Award Memorandum pursuant to the discretion of the Committee, no
Award granted hereunder shall be transferable other than by will or the
laws of descent and distribution or pursuant to a qualified domestic
relations order.
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(i) Tax Withholding. Upon the issuance of Common Shares, the payment
of cash or any other taxable event in respect of an Award under this Plan,
such number of shares or amount of cash or other consideration, as the case
may be, otherwise issuable or payable may be reduced by the amount
necessary to satisfy the minimum applicable tax withholding requirements
imposed on the Company or any of its subsidiaries or affiliates in respect
of such Award or event, all to the extent and in such manner as the
Committee may determine.
6. Adjustments and Acceleration.
(a) Adjustments. If (i) the outstanding securities of the class then
subject to this Plan (the "outstanding shares") (A) are increased,
decreased, exchanged or converted as a result of a stock split
(including a split in the form of a stock dividend), reverse stock
split, recapitalization, or similar event or (B) are exchanged for or
converted into cash, property or a different number or kind of
securities (or if cash, property or securities are distributed in
respect of the outstanding shares), as a result of a reorganization,
merger, consolidation, exchange, recapitalization, restructuring or
reclassification, or (ii) substantially all of the property and assets
of the Company are sold as an entirety, or (iii) the Company is
liquidated and dissolved, then, the Committee (or, in the case of
Director Options, the Board) shall, in such manner and to such extent
(if any) as is equitable and appropriate, make proportionate
adjustments in (x) the number and type of shares or other securities
or cash or other property that may be acquired pursuant to Options and
other Awards previously granted under this Plan (and, where
applicable, the exercise price thereof so as to maintain the same
aggregate exercise price), (y) the maximum number and type of shares
or other securities, cash, or property that may be issued or delivered
pursuant to Options (including Incentive Stock Options and Director
Options) and other Awards thereafter granted under this Plan, and (z)
such other terms as necessarily are affected by such event. In the
case of an extraordinary distribution, merger, reorganization,
consolidation, combination, sale of assets, exchange or spin off, the
Committee (or the Board, in the case of Director Options) may make
provisions for a substitution or exchange of any or all outstanding
Options or other Awards or rights (or for the securities, cash or
property deliverable upon exercise of such outstanding Options or
other Awards or rights), based upon the distribution or consideration
payable to holders of the Common Shares of the Company upon or in
respect of such event.
(b) Acceleration.
(i) The Committee, in the exercise of its reasonable discretion,
may, but need not, make an affirmative determination in light of all
circumstances surrounding a transaction or group of related
transactions that a "Change in Control" for purposes of this Plan will
either occur or
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not occur. In making any such determination, the Committee shall give
due consideration, without limitation, to the likely effect of such
transaction(s) on the makeup of the shareholder base, the Board and
the senior management of the Company. If the Committee does not
exercise the right to make this affirmative determination with respect
to a specific transaction or group of related transactions, then, with
respect thereto, a "Change in Control" shall be deemed to occur for
purposes of this Plan upon the occurrence of any one of the following
events:
(A) An acquisition (other than directly from the Company)
of any common stock or other "Voting Securities" (as hereinafter
defined) of the Company by any "Person" (as the term person is
used for purposes of Sections 13(d) or 14(d) of the Exchange Act,
immediately after which such Person has "Beneficial Ownership"
(within the meaning of Rule 13d-3 under the Exchange Act) of
twenty five percent (25%) or more of the then outstanding shares
of the Company's common stock or the combined voting power of the
Company's then outstanding Voting Securities; provided, however,
that in determining whether a Change in Control has occurred,
Voting Securities which are acquired in a "Non-Control
Acquisition" (as hereinafter defined) shall not constitute an
acquisition which would cause a Change in Control. For purposes
of this Plan, (1) "Voting Securities" shall mean the Company's
outstanding voting securities entitled to vote generally in the
election of directors and (2) a "Non-Control Acquisition" shall
mean an acquisition by (a) an employee benefit plan (or a trust
forming a part thereof) maintained by (x) the Company, or, (y)
any corporation or other Person of which a majority of its voting
power or its voting equity securities or equity interest is
owned, directly or indirectly, by the Company (for purposes of
this definition, a "Subsidiary"), (b) the Company or any of its
Subsidiaries, or (c) any Person in connection with a "Non-Control
Transaction" (as hereinafter defined);
(B) The individuals who as of March 1, 2000 are members of
the Board (the "Incumbent Board") cease for any reason to
constitute at least two-thirds of the members of the Board;
provided, however, that if the election, or nomination for
election by the Company's common stockholders, of any new
director was approved by a vote of at least two-thirds of the
Incumbent Board, such new director shall, for purposes of this
Plan, be considered as a member of the Incumbent Board; provided
further, however, that no individual shall be considered a member
of the Incumbent Board if such individual initially assumed
office as a result of either an actual or threatened "Election
Contest" (as described in Rule 14a-11 under the Exchange Act) or
other actual or threatened
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solicitation of proxies or consents by or on behalf of a Person
other than the Board (a "Proxy Contest") including by reason of
any agreement intended to avoid or settle any Election Contest or
Proxy Contest; or
(C) The consummation of: (1) A merger, consolidation or
reorganization involving the Company, unless such merger,
consolidation or reorganization is a "Non-Control Transaction." A
"Non-Control Transaction" shall mean a merger, consolidation or
reorganization of the Company where: (a) the stockholders of the
Company, immediately before such merger, consolidation or
reorganization, own directly or indirectly immediately following
such merger, consolidation or reorganization, at least seventy
percent (70%) of the combined voting power of the outstanding
Voting Securities of the corporation resulting from such merger,
consolidation or reorganization (the "Surviving Corporation") in
substantially the same proportion as their ownership of the
Voting Securities immediately before such merger, consolidation
or reorganization; (b) the individuals who were members of the
Incumbent Board immediately prior to the execution of the
agreement providing for such merger, consolidation or
reorganization constitute at least two-thirds of the members of
the board of directors of the Surviving Corporation, or in the
event that, immediately following the consummation of such
transaction, a corporation beneficially owns, directly or
indirectly, a majority of the Voting Securities of the Surviving
Corporation, the board of directors of such corporation; and (c)
no Person other than (w) the Company, (x) any Subsidiary, (y) any
employee benefit plan (or any trust forming a part thereof)
maintained by the Company, the Surviving Corporation, or any
Subsidiary, or (z) any Person who, immediately prior to such
merger, consolidation or reorganization had Beneficial Ownership
of twenty-five percent (25%) or more of the then outstanding
Voting Securities or common stock of the Company, has Beneficial
Ownership of twenty-five percent (25%) or more of the combined
voting power of the Surviving Corporation's then outstanding
Voting Securities or its common stock;
(2) A complete liquidation or dissolution of the
Company,
(3) The sale or other disposition of all or
substantially all of the assets of the Company to any Person
(other than a transfer to a Subsidiary); or
(D) or any other occurrence or state of facts, whether
similar or dissimilar to the foregoing, that is determined by the
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Committee to constitute a change in control of the management or
policies of the Company.
Notwithstanding the foregoing provisions of this Section 6(b)(i),
a Change in Control shall not be deemed to occur solely because any
Person (the "Subject Person") acquired Beneficial Ownership of more
than the permitted amount of the then outstanding common stock or
Voting Securities as a result of the acquisition of common stock or
Voting Securities by the Company which, by reducing the number of
shares of common stock or Voting Securities then outstanding,
increases the proportional number of shares Beneficially Owned by the
Subject Persons; provided, however, that if a Change in Control would
occur (but for the operation of this sentence) as a result of the
acquisition of common stock or Voting Securities by the Company, and
after such share acquisition by the Company, the Subject Person
becomes the Beneficial Owner of any additional common stock or Voting
Securities which increases the percentage of the then outstanding
common stock or Voting Securities Beneficially Owned by the Subject
Person, then a Change in Control shall occur.
(i) Except as otherwise provided in Section 10(j), prior to a
Change in Control, the Committee may determine in respect of Awards
held by Employees that upon or in anticipation of the occurrence of
the Change in Control benefits under Awards shall be accelerated only
for a limited period of time, which period of time shall not be less
than a period of time reasonably necessary to realize the benefits of
such acceleration nor more than one year after the Change in Control.
If such a determination is not made, then (subject to the last
sentence of this clause) upon the occurrence of a Change in Control
and without further action by the Board or the Committee, (A) each
Option and stock appreciation right shall become immediately
exercisable, (B) performance Restricted Stock shall immediately vest
free of restrictions, and (C) each performance share Award shall
become payable to the Employee. The Committee may override the
limitations on acceleration in this Section 6(b)(ii) by express
provision in the Award Memorandum or otherwise, and may accord any
holder of an Award a right to refuse any acceleration, whether
pursuant to the Award Memorandum or otherwise, in such circumstances
as the Committee may approve. Any acceleration of Awards shall comply
with any applicable regulatory and financial accounting requirements,
including without limitation Section 422 of the Code.
(ii) Any Awards that are (or but for a holder's rejection of
acceleration would have been) accelerated under this Section 6 and
that are not exercised or vested prior to a dissolution of the Company
or a reorganization event described in Section 6(a) that the Company
does not survive shall terminate, provided that if provision has been
made,
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consistent with the terms hereof, for the substitution, exchange or
other settlement of Awards, such Awards shall be substituted,
exchanged or otherwise settled in accordance with such provision.
(iii) Any Awards that are (or but for the holder's rejection of
the acceleration would have been) accelerated that are not exercised
or vested prior to an abandonment or termination of a transaction
subject to shareholder approval that triggered the Change in Control
(as evidenced by public announcement, Board resolution, execution of
documents terminating the transaction, or other action or document
objectively confirming such abandonment or termination), shall be
restored to their prior status (except for the effects of the passage
of time) as if no Change in Control had occurred.
7. Amendment and Termination of Plan.
(a) No Award shall be granted under this Plan after March 1, 2010.
Although Common Shares may be issued after March 1, 2010 pursuant to Awards
granted prior to such date, no Common Shares otherwise shall be issued
under this Plan after such date. Notwithstanding the foregoing, any Award
granted prior to such date may vest or be amended after such date in any
manner that would have been permitted prior to such date, except that
(except as provided herein) no such amendment shall increase the number of
shares subject to or comprising such Award, or extend the final expiration
date of the Award or reduce (below the Fair Market Value (as defined in
Section 10) on the date of the amendment) the exercise price of or under
such Award.
(b) The Board may, without shareholder approval, at any time and from
time to time, suspend, discontinue or amend this Plan in any respect
whatsoever, except that no such amendment shall impair any rights under any
Award theretofore made under the Plan without the consent of the holder of
such Award. Furthermore, and except as and to the extent otherwise
permitted by the provisions hereof, no such amendment shall, without
shareholder approval, cause the Plan to cease to satisfy any applicable
condition of Rule 16b-3 under the Exchange Act or cause any Award under the
Plan to cease to qualify for any applicable exception under Section 162(m)
of the Code.
8. Effective Date of Plan: Shareholder Approval. This Plan shall be
effective as of March 1, 2000, the date upon which it was approved by the
Board; provided, however, that no Common Shares may be issued under this
Plan until it has been approved by the affirmative votes of the holders of
a majority of the Common Shares of the Company present, or represented, and
entitled to vote at a meeting duly held in accordance with applicable law.
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9. Legal Issues.
(a) Compliance and Choice of Law: Severability. This Plan, the
granting and vesting of Awards under this Plan and the issuance and
delivery of Common Shares and/or the payment of money under this Plan or
under Awards granted hereunder are subject to compliance with all
applicable federal and state laws, rules and regulations (including but not
limited to state and federal securities law and federal margin
requirements) and to such approvals by any listing, regulatory or
governmental authority as may, in the opinion of counsel for the Company,
be necessary or advisable in connection therewith. Any securities delivered
under this Plan shall be subject to such restrictions as the Company may
deem necessary or desirable to assure compliance with all applicable legal
requirements. This Plan, the Awards, all documents evidencing Awards and
all other related documents shall be governed by, and construed in
accordance with, the laws of the State of Delaware. If any provision shall
be held by a court of competent jurisdiction to be invalid and
unenforceable, the remaining provisions of this Plan (subject to Section
9(b)) shall continue in effect.
(b) Plan Construction. It is the intent of the Company that this Plan
and Awards hereunder satisfy and be interpreted in a manner that in the
case of recipients who are or may become persons subject to Section 16 of
the Exchange Act satisfies the applicable requirements of Rule 16b-3 under
the Exchange Act so that such persons will be entitled to the benefits of
Rule 16b-3 or other exemptive rules under Section 16 of the Exchange Act
and will not be subjected to avoidable liability thereunder. If any
provision of this Plan or of any Award would otherwise frustrate or
conflict with the intent expressed above, that provision to the extent
possible shall be interpreted and deemed amended so as to avoid such
conflict, but to the extent of any remaining irreconcilable conflict with
such intent as to such persons in the circumstances, such provision shall
be deemed inoperative.
(c) Non-Exclusivity of Plan. Nothing in this Plan shall limit or be
deemed to limit the authority of the Board or the Committee to grant awards
or authorize any other compensation, with or without reference to the
Common Shares, under any other plan or authority.
10. Non-Employee Director Options
(a) Participation. Awards relating to the Common Shares authorized
under this Plan shall be made under this Section 10 only to Non-Employee
Directors.
(b) Certain Definitions. The following definitions shall apply to
this Section 10:
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(i) "Business Day" shall mean any day, other than Saturday,
Sunday or any statutory holiday in the state of California.
(ii) "Director Option" shall mean an Option granted to a
Non-Employee Director pursuant to this Section 10.
(iii) "Disability" shall mean a "permanent and total disability"
within the meaning of Section 22(e)(3) of the Code.
(iv) "Fair Market Value" on a specified date shall mean (A) if
the Common Shares are listed or admitted to trade on a national
securities exchange, the average of the high and low reported sales
prices of the Common Shares on the Composite Tape on such date, as
published in the Western Edition of The Wall Street Journal, on the
principal national securities exchange on which the Common Shares are
so listed or admitted to trade, or, if there is no trading of the
Shares on such date, then the average of the high and low reported
sales prices of the Common Shares as quoted on such Composite Tape on
the next preceding date on which there is trading in such Shares; (B)
if the Common Shares are not listed or admitted to trade on a national
securities exchange, the average of the high and low reported prices
for the Common Shares on such date, as furnished by the National
Association of Securities Dealers, Inc. ("NASD") through the NASDAQ
National Market Reporting System (or a similar organization, if the
NASD is no longer reporting such information); (C) if the Common
Shares are not listed or admitted to trade on a national securities
exchange and are not reported on the National Market Reporting System,
the arithmetic mean between the bid and asked prices for the Shares on
such date, as furnished by the NASD or a similar organization; or (D)
if the Common Shares are not listed or admitted to trade on a national
securities exchange nor reported on the National Market Reporting
System and if bid and asked prices for the stock are not furnished by
the NASD or a similar organization, the value as established by the
Board at such time for purposes of this Plan.
(v) "Retirement" shall mean retirement or resignation as a
director after at least five (5) years service as a director.
(c) Annual Awards. On the same date as the annual grant of Awards to
Employees pursuant to this Plan in each calendar year after 2000 during the
term of the Plan, there shall be granted to each Non-Employee Director then
in office nonqualified stock options to purchase the number of Common
Shares equal to 0.025% of the issued and outstanding Common Shares of the
Company (excluding any Common Shares held in treasury by the Company) as of
the end of the preceding fiscal year.
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(d) Minimum Number of Shares. Notwithstanding anything to the
contrary contained herein, a Non-Employee Director shall not receive
Options for less than 7,500 Common Shares pursuant to this Section 10 in
any calendar year.
(e) Purchase Price. The exercise price for Shares under any Director
Option shall be equal to 100% of the Fair Market Value of a Common Share on
the date the Director Option is granted. The exercise price for Shares
under any Director Option may be modified by a separate vote of the members
of the Board who are officers of the Company, as well as the full Board;
provided, that the modified exercise price shall be no less than 100% of
the Fair Market Value of a Common Share on the date the exercise price of
the Director Option is modified. The exercise price of any option granted
under this Section 10 shall be paid in full at the time of each purchase in
cash equivalent or in Common Shares valued at their Fair Market Value on
the date of exercise of such option, or partly in such shares and partly in
cash, provided that any such Common Shares used in payment shall have been
owned by the Non-Employee Director at least six months prior to the date of
exercise.
(f) Option Period and Exercisability. Each Director Option granted
under this Section 10 shall become fully exercisable, in whole or in part,
on the first anniversary of the grant date. Each option granted under this
Section 10 and all rights or obligations thereunder shall expire on the
earlier of the tenth anniversary of the date of grant or the liquidation or
dissolution of the Company and shall be subject to earlier termination as
provided below.
(g) Termination of Directorship. If a Non-Employee Director's
services as a member of the Board, or as a member of the board of directors
of a subsidiary or affiliate of the Company, terminate by reason of death,
Disability or Retirement, an option granted pursuant to this Section 10
then held by such Non-Employee Director shall immediately become and shall
remain exercisable for one year after the date of such termination or until
the expiration of the stated term of such option, whichever first occurs.
If a Non-Employee Director's services as a member of the Board, or as a
member of the board of directors of a subsidiary or affiliate of the
Company, terminate for any other reason (other than Cause), any option
granted pursuant to this Section 10 which is not then exercisable shall
terminate and any such option which is then exercisable may be exercised
for three months after the date of such termination or until the expiration
of the stated term, which ever first occurs. If a Non-Employee Director is
terminated for Cause, all Director Options granted to such Non-Employee
Director shall be forfeited and shall no longer be exercisable, effective
on the date of such termination for Cause. For purposes of this Section 10,
"Cause" shall mean, with respect to any Non-Employee Director, termination
on account of any act of (i) fraud or intentional misrepresentation, (ii)
embezzlement, misappropriation or conversion of assets or opportunities of
the Company or any subsidiary or affiliate, or (iii) conviction of a
felony.
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(h) Adjustments. The provisions of this Section 10 and Director
Options granted hereunder shall be subject to Section 6. If there shall
occur any event described in Section 6(a), then in addition to the matters
contemplated thereby, the Board shall, in such manner and to such extent
(if any) as is appropriate and equitable, proportionately adjust the dollar
amounts set forth elsewhere in this Section 10.
(i) Loans. Subject to the requirements of applicable law, the Board
may authorize loans to Non-Employee Directors to finance the exercise of
Awards; provided, however, that no loan shall be made to any Non-Employee
Director to finance the exercise of an Award made under this Section 10
unless (i) such loan is made pursuant to a full recourse promissory note,
and (ii) such loan, if secured by Common Shares (whether issuable under the
Award in question or otherwise), is made in compliance with Regulation G of
the Federal Reserve Board.
(j) Acceleration Upon a Change in Control. Upon the occurrence of a
Change in Control referred to in Section 6(b), each Director Option granted
under this Section 10 shall become immediately exercisable in full subject
to the terms thereof. To the extent that any Director Option granted under
this Section 10 is not exercised prior to (i) a dissolution of the Company
or (ii) a merger or other corporate event that the Company does not
survive, and no provision is (or consistent with the provisions of Section
9 or 10 can be) made for the assumption, conversion, substitution or
exchange of the option, the Director Option shall terminate upon the
occurrence of such event.
(k) Other Provisions. The provisions of Sections 3(e)-(f), 5(h) and 7
through 9 are incorporated herein by this reference.
(l) Grant of Options to Newly Elected Non-Employee Directors. Upon
the election of a newly elected Non-Employee Director, there shall be
granted automatically (without any action by the Committee or the Board) a
nonqualified stock option (the grant date of which shall be the date of
such election) to each newly elected Non-Employee Director as follows: (i)
if the Non-Employee Director is elected within six months of the date on
which the most recent Director Options were granted to existing
Non-Employee Directors, a non-qualified stock option to purchase the same
number of Common Shares for which the most recent Director Options were
granted to existing Non-Employee Directors, and (ii) if the Non-Employee
Director is elected more than six months following the date on which the
most recent Director Options were granted to existing Non-Employee
Directors, but prior to the date in the following calendar year on which
Director Options are granted to existing Non-Employee Directors, a
non-qualified stock option to purchase one-half the number of Common Shares
for which the most recent Director Options were granted to existing
Non-Employee Directors.
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Amendments to the
2000 Stock Incentive Plan
(Adopted by the Board of Directors on October 17, 2000)
1. Section 4(c)(iv) of the 2000 Stock Incentive Plan ("2000 Plan") shall be
deleted in its entirety and replaced with the following:
"(iv) extend the exercisability or term of any or all such
outstanding Awards or otherwise change previously imposed terms and
conditions, in the specified events described in clause (ii) above, or
in other circumstances or upon the occurrence of other events as
deemed appropriate by the Committee, in each case subject to Section
7;"
2. Section 5(f)(iii) of the 2000 Plan shall be deleted in its entirety and
replaced with the following:
"(iii) if the holder terminates service as an Employee by reason
of death, or if such death occurs within three months after a
termination described in clauses (i) or (ii), then such Option may be
exercised within a period of twelve (12) months after the holder's
termination of services as an Employee, to the extent such Option was
exercisable on the date of such termination;"
3. To correct the error in Section 6(b) of the 2000 Plan whereby there exist
two subparagraphs enumerated as "(i)", the second such subparagraph shall
be renumbered (ii) and the subparagraphs currently numbered (ii) and (iii)
shall be renumbered (iii) and (iv).
4. The second sentence of Section 7(a) of the 2000 Plan shall be deleted in
its entirety and replaced with the following:
"Notwithstanding the foregoing, any Award granted prior to such date
may vest or be amended after such date in any manner that would have
been permitted prior to such date, except that no such amendment shall
increase the number of shares subject to or comprising such Award,
extend the final expiration date of the Award or reduce the exercise
price of or under such Award."
5. The second sentence of Section 10(e) of the 2000 Plan shall be deleted in
its entirety.
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