Exhibit 10.11
PATHMARK STORES, INC. 2000 EMPLOYEE EQUITY PLAN
1. Purposes
The purposes of the Pathmark Stores, Inc. 2000 Employee Equity Plan
(the "Plan") are to attract, retain and motivate key employees of the Company,
to compensate them for their contributions to the growth and profits of the
Company and to encourage ownership by them of Common Stock.
2. Definitions
For purposes of the Plan, the following terms shall be defined as
follows:
"Administrator" means the individual or individuals to whom
the Committee delegates authority under the Plan in accordance with
Section 3(d).
"Award" means an award made pursuant to the terms of the Plan
to an Eligible Individual in the form of Stock Options, Stock
Appreciation Rights, Stock Awards, Restricted Stock Units, Performance
Units or Other Awards.
"Award Agreement" means a written document approved in
accordance with Section 3 which sets forth the terms and conditions of
the Award to the Participant. An Award Agreement may be in the form of
(i) an agreement between the Company which is executed by an officer on
behalf of the Company and is signed by the Participant or (ii) a
certificate issued by the Company which is executed by an officer on
behalf of the Company but does not require the signature of the
Participant.
"Board" means the Board of Directors of the Company.
"Change in Control" shall mean any of the following:
(i) the acquisition by any Person of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of 35% or more of the Common Stock then
outstanding, but shall not include any such acquisition by any
employee benefit plan of the Company, any Person or entity
organized, appointed or established by the Company for or
pursuant to the terms of any such employee benefit plan; any
Person (other than any of Fidelity Management & Research
Company or Fidelity Management Trust Company or by any fund or
account associated with either Fidelity Management & Research
Company or Fidelity Management Trust Company) who as of
September 19, 2000 was the beneficial owner of 15% or more of
the shares of Common Stock outstanding on such date unless and
until such Person, together with all Affiliates of such
Person, becomes the beneficial owner of 35% or more of the
shares of Common Stock then outstanding whereupon a Change in
Control shall be deemed to have occurred;
(ii) consummation after approval by the shareholders
of Pathmark of either (A) a plan of complete liquidation or
dissolution of Pathmark or (B) a merger, amalgamation or
consolidation of Pathmark with any other corporation,
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the issuance of voting securities of Pathmark in connection
with a merger or consolidation of Pathmark or sale or other
disposition of all or substantially all of the assets of
Pathmark or the acquisition of assets of another corporation
(each, a "Business Combination"), unless, in each case of a
Business Combination, immediately following such Business
Combination, all or substantially all of the individuals and
entities who were the beneficial owners of the Common Stock
outstanding immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of the
then outstanding shares of common stock and 50% of the
combined voting power of the then outstanding voting
securities entitled to vote generally in the election of
directors, as the case may be, of the entity resulting from
such Business Combination (including, without limitation, an
entity which as a result of such transaction owns the Company
or all or substantially all of Pathmark's assets either
directly or through one or more subsidiaries) in substantially
the same proportions as their ownership, immediately prior to
such Business Combination, of the Common Stock; or
(iii) the individuals who, as of September 19, 2000,
constitute the Board, and subsequently elected members of the
Board whose election is approved or recommended by at least a
majority of such current members or their successors whose
election was so approved or recommended (other than any
subsequently elected members whose initial assumption of
office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors
or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board),
cease for any reason to constitute at least a majority of such
Board.
For purposes of the above definition of Change in Control
only, the following defined terms shall apply:
"Affiliate" means, with respect to any Person, any
other entity which (i) is a Subsidiary of such Person, (ii)
is, directly or indirectly, under common control with such
Person, or (iii) is, directly or indirectly, controlling such
Person.
"Person" means any person, entity or "group" within
the meaning of Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act, except that such term shall not include (i) the
Company or any of its subsidiaries, (ii) a trustee or other
fiduciary holding securities under an employee benefit plan of
the Company, (iii) an underwriter temporarily holding
securities pursuant to an offering of such securities, or (iv)
an entity owned, directly or indirectly, by the shareholders
of Pathmark in substantially the same proportions as their
ownership of stock of Pathmark.
"Subsidiary" means with respect to any Person, any
entity of which:
(i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time of
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determination owned or controlled, directly or indirectly,
collectively or individually, by such Person or by one or more
Affiliates of such Person, and
(ii) if a partnership, association, limited liability
company or other entity, a majority of the partnership,
membership or other similar ownership interest thereof is at
the time of determination owned or controlled, directly or
indirectly, collectively or individually, by such Person or by
one or more Affiliates of such Person.
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"Code" means the Internal Revenue Code of 1986, as
amended, and the applicable rulings and regulations (including
any proposed regulations) thereunder.
"Committee" means the Compensation Committee of the
Board, any successor committee thereto or any other committee
appointed from time to time by the Board to administer the
Plan. The Committee shall consist of at least two individuals
and shall serve at the pleasure of the Board.
"Common Stock" means the Common Stock of the Company,
par value $.01 per share, or such other class or kind of
shares or other securities as may be applicable under Section
15 below.
"Company" means, individually and collectively,
Pathmark and its Subsidiaries, and any successor thereto.
"Eligible Individuals" means the individuals
described in Section 6 who are eligible for Awards under the
Plan.
"Exchange Act" means the Securities Exchange Act of
1934, as amended, and the applicable rulings and regulations
thereunder.
"Excluded Individual" means (i) any individual who is
designated by the Company at the time of hire as not eligible
to participate in the Plan or (ii) any individual who is
treated or designated by the Company as an independent
contractor, leased employee (including, without limitation, a
"leased employee" as defined in Section 414(n) of the Code) or
consultant. Excluded Individuals are not eligible to
participate in or receive benefits under the Plan. If any
Excluded Individual pursuant to the preceding clauses (i) or
(ii) shall be determined by a court or federal, state or local
regulatory or administrative authority to have served as a
common law employee of the Company, such determination shall
not alter such person's status as an Excluded Individual for
purposes of the Plan
"Fair Market Value" means, with respect to a share of
Common Stock, the fair market value thereof as of the relevant
date of determination, as determined in accordance with a
valuation methodology approved by the Committee, and according
to the following, as applicable:
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(i) If the Common Stock is quoted on the NASDAQ
National Market , in the absence of any alternative valuation
methodology approved by the Board, the Fair Market Value of a
share of Common Stock shall equal the per share closing price
quoted on the day immediately prior to the date of grant as
reported in the transactions index of each such exchange, as
published in The Wall Street Journal, or, if no closing price
was quoted in any such index for such date, then as of the
next preceding date on which such a closing price was quoted;
(ii) If the Common Stock is not quoted on the NASDAQ
National Market, but is publicly traded on another national
securities exchange or quoted on an automated system, the Fair
Market Value of a share of Common Stock shall equal the per
share closing price quoted on the day immediately prior to the
date of grant as reported in the transactions index of each
such exchange or automated system, as published in The Wall
Street Journal, or, if no closing price was quoted in any such
index for such date, then as of the next preceding date on
which such a closing price was quoted; and
(iii) If the Common Stock is not publicly traded on a
national securities exchange or quoted on the NASDAQ National
Market or any other automated system, the Fair Market Value of
a share of Common Stock shall be reasonably determined in good
faith by the Board.
"Incentive Stock Option" means a Stock Option that is
an "incentive stock option" within the meaning of Section 422
of the Code and designated by the Committee as an Incentive
Stock Option in an Award Agreement.
"Nonqualified Stock Option" means a Stock Option that
is not an Incentive Stock Option.
"Other Award" means any other form of award
authorized under Section 13 of the Plan.
"Participant" means an Eligible Individual to whom an
Award has been granted under the Plan.
"Pathmark" means Pathmark Stores, Inc., a Delaware
corporation.
"Performance Unit" means a performance unit granted
to an Eligible Individual pursuant to Section 12 hereof.
"Restricted Stock Unit" means a restricted stock unit
granted to an Eligible Individual pursuant to Section 11
hereof.
"Stock Appreciation Right" means a right to receive
all or some portion of the appreciation on shares of Common
Stock granted to an Eligible Individual pursuant to Section 9
hereof.
"Stock Award" means a share of Common Stock granted
to an Eligible Individual for
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no consideration other than the provision of services or offer
for sale to an Eligible Employee at a purchase price
determined by the Committee, in either case pursuant to
Section 10 hereof.
"Stock Option" means an Award to purchase shares of
Common Stock granted to an Eligible Individual pursuant to
Section 8 hereof, which Award may be either an Incentive Stock
Option or a Nonqualified Stock Option.
"Subsidiary" means (i) a corporation or other entity
with respect to which Pathmark, directly or indirectly, has
the power, whether through the ownership of voting securities,
by contract or otherwise, to elect at least a majority of the
members of such corporation's board of directors or analogous
governing body, or (ii) any other corporation or other entity
in which Pathmark, directly or indirectly, has an equity or
similar interest and which the Committee designates as a
Subsidiary for purposes of the Plan.
3. Administration of the Plan
(a) Power and Authority of the Committee. The Plan shall be
administered by the Committee, which shall have full power and authority,
subject to the express provisions hereof:
(i) to select Participants from the Eligible Individuals;
(ii) to make Awards in accordance with the Plan;
(iii) to determine the number of shares of Common Stock subject to
each Award or the cash amount payable in connection with an
Award;
(iv) to determine the terms and conditions of each Award, other
than the terms and conditions that are expressly required
under the terms of the Plan;
(v) to specify and approve the provisions of the Award Agreements
delivered to Participants in connection with their Awards;
(vi) to construe and interpret any Award Agreement delivered under
the Plan;
(vii) to prescribe, amend and rescind rules and procedures relating
to the Plan;
(viii) to vary the terms of Awards to take account of tax, securities
law and other regulatory requirements of foreign
jurisdictions;
(ix) subject to the provisions of the Plan and subject to such
additional limitations and restrictions as the Committee may
impose, to delegate to one or more officers of the Company
some or all of its authority under the Plan;
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(x) to employ such legal counsel, independent auditors and
consultants as it deems desirable for the administration of
the Plan and to rely upon any opinion or computation received
therefrom; and
(xi) to make all other determinations and to formulate such
procedures as may be necessary or advisable for the
administration of the Plan.
(b) Plan Construction and Interpretation. The Committee shall have full
power and authority, subject to the express provisions hereof, to construe and
interpret the Plan.
(c) Determinations of Committee Final and Binding. All determinations
by the Committee in carrying out and administering the Plan and in construing
and interpreting the Plan shall be final, binding and conclusive for all
purposes and upon all persons interested herein.
(d) Delegation of Authority. The Committee may, but need not, from time
to time delegate some or all of its authority under the Plan to an Administrator
consisting of one or more members of the Committee or of one or more officers of
the Company; provided, however, that the Committee may not delegate its
authority (i) to make Awards to Eligible Individuals who are officers of the
Company who are delegated authority by the Committee hereunder, or (ii) under
Sections 3(b) and 16 of the Plan. Any delegation hereunder shall be subject to
the restrictions and limits that the Committee specifies at the time of such
delegation or thereafter. Nothing in the Plan shall be construed as obligating
the Committee to delegate authority to an Administrator, and the Committee may
at any time rescind the authority delegated to an Administrator appointed
hereunder or appoint a new Administrator. At all times, the Administrator
appointed under this Section 3(d) shall serve in such capacity at the pleasure
of the Committee. Any action undertaken by the Administrator in accordance with
the Committee's delegation of authority shall have the same force and effect as
if undertaken directly by the Committee, and any reference in the Plan to the
Committee shall, to the extent consistent with the terms and limitations of such
delegation, be deemed to include a reference to the Administrator.
(e) Liability of Committee. No member of the Committee shall be liable
for any action or determination made in good faith, and the members of the
Committee shall be entitled to indemnification and reimbursement in the manner
provided in Pathmark's Certificate of Incorporation as it may be amended from
time to time. In the performance of its responsibilities with respect to the
Plan, the Committee shall be entitled to rely upon information and advice
furnished by the Company's officers, the Company's accountants, the Company's
counsel and any other party the Committee deems necessary, and no member of the
Committee shall be liable for any action taken or not taken in reliance upon any
such advice.
(f) Action by the Board. Anything in the Plan to the contrary
notwithstanding, any authority or responsibility which, under the terms of the
Plan, may be exercised by the Committee may alternatively be exercised by the
Board.
4. Effective Date and Term
The Plan shall become effective upon its adoption by the Board subject
to its approval by the stockholders of Pathmark. Prior to such stockholder
approval, the Committee may grant
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Awards conditioned on stockholder approval. If such stockholder approval is not
obtained at or before the first annual meeting of stockholders to occur after
the adoption of the Plan by the Board (including any adjournment or adjournments
thereof), the Plan and any Awards made thereunder shall terminate ab initio and
be of no further force and effect. In no event shall any Awards be made under
the Plan after the tenth anniversary of the date of stockholder approval.
5. Shares of Common Stock Subject to the Plan
(a) General. Subject to adjustment as provided in Section 15(b) hereof,
the number of shares of Common Stock that may be issued pursuant to Awards under
the Plan (the "Section 5 Limit") shall not exceed, in the aggregate 5,164,118
shares. Shares issued under this Plan may be either authorized but unissued
shares, treasury shares or any combination thereof.
(b) Rules Applicable to Determining Shares Available for Issuance. For
purposes of determining the number of shares of Common Stock that remain
available for issuance, the following shares shall be added back to the Section
5 Limit and again be available for Awards:
(i) The number of shares tendered to pay the exercise price of a
Stock Option or other Award; and
(ii) The number of shares withheld from any Award to satisfy a
Participant's tax withholding obligations or, if applicable,
to pay the exercise price of a Stock Option or other Award.
In addition, any shares underlying Substitute Awards shall not be counted
against the Section 5 Limit.
6. Eligible Individuals
Awards may be granted by the Committee to individuals ("Eligible
Individuals") who are: (i) officers or other key employees of the Company; (ii)
employees of joint ventures, partnerships or similar business organizations in
which the Company has a direct or indirect equity interest; and (iii)
individuals who provide services to any similar joint ventures or business
organizations in which the Company may participate in the future. Excluded
Individuals are not eligible to receive Awards under the Plan. Members of the
Committee will not be eligible to receive Awards under the Plan. An individual's
status as an Administrator will not affect his or her eligibility to participate
in the Plan.
7. Awards in General
(a) Types of Award and Award Agreement. Awards under the Plan may
consist of Stock Options, Stock Appreciation Rights, Stock Awards, Restricted
Stock Units, Performance Units or Other Awards. Any Award described in Sections
8 through 13 of the Plan may be granted singly or in combination or tandem with
any other Award, as the Committee may determine. Awards may be made in
combination with, in replacement of, or as alternatives to grants of rights
under any other employee compensation plan of the Company, including the plan of
any acquired entity, or may be granted in satisfaction of the Company's
obligations under any such plan.
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(b) Terms Set Forth in Award Agreement. The terms and provisions of an
Award shall be set forth in a written Award Agreement approved by the Committee
and delivered or made available to the Participant as soon as practicable
following the date of the award. The vesting, exercisability, payment and other
restrictions applicable to an Award (which may include, without limitation,
restrictions on transferability or provision for mandatory resale to the
Company) shall be determined by the Committee and set forth in the applicable
Award Agreement. Notwithstanding the foregoing, the Committee may accelerate (i)
the vesting or payment of any Award, (ii) the lapse of restrictions on any Award
or (iii) the date on which any Stock Option, Stock Appreciation Right or other
Award first becomes exercisable. The terms of Awards may vary among Participants
and the Plan does not impose upon the Committee any requirement to make Awards
subject to uniform terms. Accordingly, the terms of individual Award Agreements
may vary.
(c) Termination of Employment and Change in Control. The terms of this
Section 7(c) shall apply unless the Committee, in its sole discretion,
determines that alternative terms shall be included in any Award Agreement in
which case the terms in such Award Agreement shall govern the rights of the
Participant.
(i) In the event of a Change in Control, all unvested Awards under
the Plan shall become vested immediately prior to the Change
in Control.
(ii) Except as provided in Sections 7(c)(iii), 7(c)(iv) and 7(c)(v)
below, in the event that a Participant's employment with the
Company is terminated for any reason unless otherwise
determined by the Committee in its sole discretion, the
unvested portion of any outstanding Award held by such
Participant shall lapse and become void and the vested portion
of any such Awards will remain exercisable for a period of
sixty days after the date of such termination.
(iii) With respect to any Stock Option, if a Participant ceases to
be employed by the Company by reason of death or permanent and
total disability within the meaning of Section 22(e)(3) of the
Code, the unvested portion of any outstanding Stock Option
held by such Participant shall lapse and become void and the
vested portion of any such Stock Option will remain
exercisable for a period of twelve months after the date of
such termination.
(iv) With respect to any Nonqualified Stock Option, if a
Participant ceases to be employed by the Company by reason of
his or her retirement on or after the Participant's 65th
birthday, the unvested portion of any outstanding Nonqualified
Option held by such Participant shall lapse and become void
and the vested portion of any such Nonqualified Stock Option
will remain exercisable for a period of twelve months after
the date of such termination.
(v) With respect to any Incentive Stock Option, in the event that
a Participant's employment with the Company is terminated for
any reason other than death or disability, the unvested
portion of any outstanding Incentive Stock Option held by such
Participant shall lapse
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and become void and the vested portion of any such Incentive
Stock Option will remain exercisable for a period of ninety
days after the date of such termination.
(vi) The date of a Participant's termination of employment for any
reason shall be determined in the sole discretion of the
Committee.
(d) Dividends and Dividend Equivalents. The Committee may provide
Participants with the right to receive dividends or payments
equivalent to dividends or interest with respect to an
outstanding Awards, which payments can either be paid
currently or deemed to have been reinvested in shares of
Common Stock, and can be made in Common Stock, cash or a
combination thereof, as the Committee shall determine.
8. Stock Options
(a) Terms of Stock Options Generally. A Stock Option shall entitle the
Participant to whom the Stock Option was granted to purchase a specified number
of shares of Common Stock during a specified period at a price that is
determined in accordance with Section 8(b) below. Stock Options may be either
Nonqualified Stock Options or Incentive Stock Options. The Committee will fix
the vesting and exercisability conditions applicable to a Stock Option, provided
that no Stock Option shall vest sooner than one year from the date of grant
(subject to early vesting as provided in Section 7(c) above and such other
additional circumstances as the Committee may determine, in its discretion ).
(b) Exercise Price. The exercise price per share of Common Stock
purchasable under a Stock Option shall be fixed by the Committee at the time of
grant or, alternatively, shall be determined by a method specified by the
Committee at the time of grant; provided, however, that the exercise price per
share shall be no less than 100% of the Fair Market Value per share on the date
of grant (or it the exercise price is not fixed on the date of grant, then on
such date as the exercise price is fixed); and provided further, that, except as
provided in Section 15(b) below, the exercise price per share of Common Stock
applicable to a Stock Option may not be adjusted or amended, including by means
of amendment, cancellation or the replacement of such Stock Option with a
subsequently awarded Stock Option.
(c) Option Term. The term of each Stock Option shall be fixed by the
Committee and shall not exceed ten years from the date of grant.
(d) Method of Exercise. Subject to the provisions of the applicable
Award Agreement, the exercise price of a Stock Option may be paid in cash or
previously owned shares or a combination thereof and, if the applicable Award
Agreement so provides, in whole or in part through the withholding of shares
subject to the Stock Option with a value equal to the exercise price. In
accordance with the rules and procedures established by the Committee for this
purpose, the Stock Option may also be exercised through a "cashless exercise"
procedure approved by the Committee involving a broker or dealer approved by the
Committee, that affords Participants the opportunity to sell immediately some or
all of the shares underlying the exercised portion of the Stock Option in order
to generate sufficient cash to pay the Stock Option exercise price and/or to
satisfy withholding tax obligations related to the Stock Option.
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9. Stock Appreciation Rights
(a) General. A Stock Appreciation Right shall entitle a Participant to
receive, upon satisfaction of the conditions to the payment specified in the
applicable Award Agreement, an amount equal to the excess, if any, of the Fair
Market Value on the exercise date of the number of shares of Common Stock for
which the Stock Appreciation Right is exercised, over the exercise price for
such Stock Appreciation Right specified in the applicable Award Agreement. The
exercise price per share of Common Stock covered by a Stock Appreciation Right
shall be fixed by the Committee at the time of grant or, alternatively, shall be
determined by a method specified by the Committee at the time of grant;
provided, however, that, except as provided in Section 9(b) below, the exercise
price per share shall be no less than 100% of the Fair Market Value per share on
the date of grant (or if the exercise price is not fixed on the date of grant,
then on such date as the exercise price is fixed); and provided further, that,
except as provided in Section 15(b) below, the exercise price per share of
Common Stock subject to a Stock Appreciation Right may not be adjusted or
amended, including by means of amendment, cancellation or the replacement of
such Stock Appreciation Right with a subsequently awarded Stock Appreciation
Right. Notwithstanding the foregoing, the exercise price per share of a Stock
Appreciation Right that is a Substitute Award may be less than the Fair Market
Value per share on the date of award, provided, that such exercise price is not
less than the minimum exercise price that would be permitted for an equivalent
Stock Option as determined in accordance with Section 8(b) above. At the sole
discretion of the Committee, payments to a Participant upon exercise of a Stock
Appreciation Right may be made in cash, in shares of Common Stock having an
aggregate Fair Market Value as of the date of exercise equal to such amount, or
in a combination of cash and shares having an aggregate value as of the date of
exercise equal to such amount.
(b) Stock Appreciation Rights in Tandem with Stock Options. A Stock
Appreciation Right may be granted alone or in addition to other Awards, or in
tandem with a Stock Option. A Stock Appreciation Right granted in tandem with a
Stock Option may be granted either at the same time as such Stock Option or
subsequent thereto. If granted in tandem with a Stock Option, a Stock
Appreciation Right shall cover the same number of shares of Common Stock as
covered by the Stock Option (or such lesser number of shares as the Committee
may determine) and shall be exercisable only at such time or times and to the
extent the related Stock Option shall be exercisable, and shall have the same
term and exercise price as the related Stock Option (which, in the case of a
Stock Appreciation Right granted after the grant of the related Stock Option,
may be less than the Fair Market Value per share on the date of grant of the
tandem Stock Appreciation Right). Upon exercise of a Stock Appreciation Right
granted in tandem with a Stock Option, the related Stock Option shall be
canceled automatically to the extent of the number of shares covered by such
exercise; conversely, if the related Stock Option is exercised as to some or all
of the shares covered by the tandem grant, the tandem Stock Appreciation Right
shall be canceled automatically to the extent of the number of shares covered by
the Stock Option exercise.
10. Stock Awards
(a) General. A Stock Award shall consist of one or more shares of
Common Stock granted to a Participant for no consideration other than the
provision of services (or, if required by applicable law in the reasonable
judgment of the Company, for payment of the par value of such shares). Stock
Awards shall be subject to such restrictions (if any) on transfer
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or other incidents of ownership for such periods of time, and shall be subject
to such conditions of vesting, as the Committee may determine and as shall be
set forth in the applicable Award Agreement.
(b) Distributions. Any shares of Common Stock or other securities of
the Company received by a Participant to whom a Stock Award has been granted as
a result of a stock distribution to holders of Common Stock or as a stock
dividend on Common Stock shall be subject to the same terms, conditions and
restrictions as such Stock Award.
11. Restricted Stock Units
An Award of Restricted Stock Units shall consist of a grant of units,
each of which represents the right of the Participant to receive one share of
Common Stock, subject to the terms and conditions established by the Committee
in connection with the Award and set forth in the applicable Award Agreement.
Upon satisfaction of the conditions to vesting and payment specified in the
applicable Award Agreement, Restricted Stock Units will be payable in Common
Stock, equal to the Fair Market Value of the shares subject to such Restricted
Stock Units. Restricted Stock Units that are granted in respect to individual or
corporate performance shall vest no sooner than one year from the date of grant,
and Restricted Stock Units that are granted in connection with hiring or
retention arrangements between the Company and a Participant shall vest no
sooner than three years from the date of grant (subject to early vesting as
provided in Section 7(c) above and such other additional circumstances as the
Committee may determine, in its discretion ).
12. Performance Units
Performance units may be granted as fixed or variable share- or
dollar-denominated units subject to such conditions of vesting and time of
payment as the Committee may determine and as shall be set forth in the
applicable Award Agreement relating to such Performance Units. Performance Units
may be paid in Common Stock, cash or a combination of Common Stock and cash, as
the Committee may determine.
13. Other Awards
The Committee shall have the authority to specify the terms and
provisions of other forms of equity-based or equity-related Awards not described
above which the Committee determines to be consistent with the purpose of the
Plan and the interests of the Company, which Awards may provide for cash
payments based in whole or in part on the value or future value of Common Stock,
for the acquisition or future acquisition of Common Stock, or any combination
thereof. Other Awards shall also include cash payments (including the cash
payment of dividend equivalents) under the Plan which may be based on one or
more criteria determined by the Committee which are unrelated to the value of
Common Stock and which may be granted in tandem with, or independent of, other
Awards under the Plan.
14. Certain Restrictions
(a) Transfers. Unless the Committee determines otherwise, no Award
shall be transferable other than by will or by the laws of descent and
distribution or pursuant to a domestic relations order; provided, however, that
the Committee may, in its discretion
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and subject to such terms and conditions as it shall specify, permit the
transfer of an Award for no consideration to a Participant's family members or
to one or more trusts or partnerships established in whole or in part for the
benefit of one or more of such family members (collectively, "Permitted
Transferees"). Any Award transferred to a Permitted Transferee shall be further
transferable only by will or the laws of descent and distribution or, for no
consideration, to another Permitted Transferee of the Participant. The Committee
may in its discretion permit transfers of Awards other than those contemplated
by this Section.
(b) Exercise. During the lifetime of the Participant, a Stock Option,
Stock Appreciation Right or similar-type Other Award shall be exercisable only
by the Participant or by a Permitted Transferee to whom such Stock Option, Stock
Appreciation Right or Other Award has been transferred in accordance with
Section 14(a).
15. Recapitalization or Reorganization
(a) Authority of the Company and Stockholders. The existence of the
Plan, the Award Agreements and the Awards granted hereunder shall not affect or
restrict in any way the right or power of the Company or the stockholders of the
Company to make or authorize any adjustment, recapitalization, reorganization or
other change in the Company's capital structure or its business, any merger or
consolidation of the Company, any issue of stock or of options, warrants or
rights to purchase stock or of bonds, debentures, preferred or prior preference
stocks whose rights are superior to or affect the Common Stock or the rights
thereof or which are convertible into or exchangeable for Common Stock, or the
dissolution or liquidation of the Company, or any sale or transfer of all or any
part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
(b) Change in Capitalization. The number and kind of shares authorized
for issuance under Section 5(a) above, shall be equitably adjusted in the event
of a stock split, stock dividend, recapitalization, reorganization, merger,
consolidation, extraordinary dividend, split-up, spin-off, combination, exchange
of shares, warrants or rights offering to purchase Common Stock at a price
substantially below Fair Market Value or other similar corporate event affecting
the Common Stock in order to preserve, but not increase, the benefits or
potential benefits intended to be made available under the Plan. In addition,
upon the occurrence of any of the foregoing events, the number of outstanding
Awards and the number and kind of shares subject to any outstanding Award and
the purchase price per share, if any, under any outstanding Award shall be
equitably adjusted (including by payment of cash to a Participant) in order to
preserve the benefits or potential benefits intended to be made available to
Participants granted Awards. Such adjustments shall be made by the Committee,
whose determination as to what adjustments shall be made, and the extent
thereof, shall be final. Unless otherwise determined by the Committee, such
adjusted Awards shall be subject to the same vesting schedule and restrictions
to which the underlying Award is subject.
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16. Amendments
The Board or Committee may at any time and from time to time alter,
amend, suspend or amend the Plan in whole or in part; provided, however, that
any amendment which under the requirements of any applicable law or stock
exchange rule must be approved by the stockholders of the Company shall not be
effective unless and until such stockholder approval has been obtained in
compliance with such law or rule; and provided further, that, except as
contemplated by Section 15(b) above, the Board or Committee may not, without the
approval of the Company's stockholders, increase the maximum number of shares
issuable under the Plan or reduce the exercise price of a Stock Option or Stock
Appreciation Right. No termination or amendment of the Plan may, without the
consent of the Participant to whom an Award has been granted, adversely affect
the rights of such Participant under such Award. Notwithstanding any provision
herein to the contrary, the Board or Committee shall have broad authority to
amend the Plan or any Award under the Plan to take into account changes in
applicable tax laws, securities laws, accounting rules and other applicable
state and federal laws.
17. Miscellaneous
(a) Tax Withholding. The Company may require any individual entitled to
receive a payment in respect of an Award to remit to the Company, prior to such
payment, an amount sufficient to satisfy any Federal, state or local tax
withholding requirements. The Company shall also have the right to deduct from
all cash payments made pursuant to or in connection with any Award any Federal,
state or local taxes required to be withheld with respect to such payments. In
the case of an Award payable in shares of Common Stock, the Company may permit
such individual to satisfy, in whole or in part, such obligation to remit taxes
by directing the Company to withhold shares of Common Stock that would otherwise
be received by such individual, pursuant to such rules as the Committee may
establish from time to time.
(b) No Right to Grants or Employment. No Eligible Individual or
Participant shall have any claim or right to receive grants of Awards under the
Plan. Nothing in the Plan or in any Award or Award Agreement shall confer upon
any employee of the Company any right to continued employment with the Company
or interfere in any way with the right of the Company to terminate the
employment of any of its employees at any time, with or without cause.
(c) Other Compensation. Nothing in this Plan shall preclude or limit
the ability of the Company to pay any compensation to a Participant under the
Company's other compensation and benefit plans and programs.
(d) Other Employee Benefit Plans. Payments received by a Participant
under any Award made pursuant to the Plan shall not be included in, nor have any
effect on, the determination of benefits under any other employee benefit plan
or similar arrangement provided by the Company, unless otherwise specifically
provided for under the terms of such plan or arrangement or by the Committee.
(e) Unfunded Plan. The Plan is intended to constitute an unfunded plan
for incentive compensation. Prior to the payment or settlement of any Award,
nothing contained herein shall give any Participant any rights that are greater
than those of a general creditor of the Company. In its sole discretion, the
Committee may authorize the creation of trusts or other
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arrangements to meet the obligations created under the Plan to deliver Common
Stock or payments in lieu thereof with respect to awards hereunder.
(f) Securities Law Restrictions. The Committee may require each
Eligible Individual purchasing or acquiring shares of Common Stock pursuant to a
Stock Option or other Award under the Plan to represent to and agree with the
Company in writing that such Eligible Individual is acquiring the shares for
investment and not with a view to the distribution thereof. All certificates for
shares of Common Stock delivered under the 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 exchange upon which the Common Stock is then listed,
and any applicable federal or state securities law, and the Committee may cause
a legend or legends to be put on any such certificates to make appropriate
reference to such restrictions. No shares of Common Stock shall be issued
hereunder unless the Company shall have determined that such issuance is in
compliance with, or pursuant to an exemption from, all applicable federal and
state securities laws.
(g) Compliance with Rule 16b-3. Notwithstanding anything contained in
the Plan or in any Award Agreement to the contrary, if the consummation of any
transaction under the Plan would result in the possible imposition of liability
on a Participant pursuant to Section 16(b) of the Exchange Act, the Committee
shall have the right, in its sole discretion, but shall not be obligated, to
defer such transaction or the effectiveness of such action to the extent
necessary to avoid such liability, but in no event for a period longer than six
months.
(h) Award Agreement. In the event of any conflict or inconsistency
between the Plan and any Award Agreement, the Plan shall govern, and the Award
Agreement shall be interpreted to minimize or eliminate any such conflict or
inconsistency.
(i) Expenses. The costs and expenses of administering the Plan shall be
borne by the Company.
(j) Application of Funds. The proceeds received from the Company from
the sale of Common Stock or other securities pursuant to Awards will be used for
general corporate purposes.
(k) Applicable Law. Except as to matters of federal law, the Plan and
all actions taken thereunder shall be governed by and construed in accordance
with the laws of the State of Delaware.
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