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8-K - FORM 8-K - Bancorp of New Jersey, Inc. | c18284e8vk.htm |
Exhibit 10.1
BANCORP OF NEW JERSEY, INC.
2011 EQUITY INCENTIVE PLAN
Section 1. Purpose; Definitions. The purposes of the Bancorp of New Jersey, Inc. 2011
Equity Incentive Plan (the Plan) are to enable Bancorp of New Jersey, Inc. (the
Company) and its Affiliates to recruit and retain highly qualified personnel, to provide
those personnel with an incentive for productivity and to provide those personnel with an
opportunity to share in the growth and value of the Company.
For purposes of the Plan, the following terms will have the meanings defined below, unless the
context clearly requires a different meaning:
(a) Affiliate means, with respect to a Person, a Person that directly or indirectly
controls, is controlled by, or is under common control with such Person.
(b) Applicable Law means the legal requirements relating to the administration of
and issuance of securities under stock incentive plans, including, without limitation, the
requirements of state corporations law, federal, state and foreign securities law, federal, state
and foreign tax law, and the requirements of any stock exchange or quotation system upon which the
Shares may then be listed or quoted. For all purposes of this Plan, references to statutes and
regulations shall be deemed to include any successor statutes and regulations, to the extent
reasonably appropriate as determined by the Board.
(c) Award means an award of Options, SARs, Restricted Stock, Restricted Stock Units
or Performance Awards made under this Plan.
(d) Award Agreement means, with respect to any particular Award, the written
document that sets forth the terms of that particular Award.
(e) Board means the Board of Directors of the Company, as constituted from time to
time; provided, however, that if the Board appoints one or more Committees to perform some or all
of the Boards administrative functions hereunder, references to the Board will be deemed to also
refer to the Committee in connection with matters to be performed by that Committee.
(f) Cause means (i) conviction of, or the entry of a plea of guilty or no contest
to, a felony or any other crime that causes the Company or its Affiliates public disgrace or
disrepute, or adversely affects the Companys or its Affiliates operations or financial
performance, (ii) gross negligence or willful misconduct with respect to the Company or any of its
Affiliates, including, without limitation fraud, embezzlement, theft or proven dishonesty in the
course of employment; (iii) alcohol abuse or use of controlled drugs other than in accordance with
a physicians prescription; or (iv) a material breach of any agreement with or duty owed to the
Company or any of its Affiliates. Notwithstanding the foregoing, if a Participant and the Company
(or any of its Affiliates) have entered into an employment agreement, consulting agreement or other
similar agreement that specifically defines cause, then with respect to such Participant, Cause
shall have the meaning defined in that employment agreement, consulting agreement or other
agreement.
(g) Change in Control means the occurrence of any of the following, in one
transaction or a series of related transactions: (i) any person (as such term is used in Sections
13(d) and 14(d) of the Exchange Act) becoming a beneficial owner (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the Company representing more than 50%
of the voting power
of the Companys then outstanding securities; (ii) a consolidation, share exchange,
reorganization or merger of the Company resulting in the stockholders of the Company immediately
prior to such event not owning at least a majority of the voting power of the resulting entitys
securities outstanding immediately following such event; (iii) the sale or other disposition of all
or substantially all the assets of the Company, (iv) a liquidation or dissolution of the Company,
or (v) any similar event deemed by the Board to constitute a Change in Control for purposes of this
Plan.
(h) Code means the Internal Revenue Code of 1986, as amended from time to time, and
any successor thereto.
(i) Committee means a committee appointed by the Board in accordance with Section 2
of the Plan.
(j) Director means a member of the Board.
(k) Disability means a condition rendering a Participant Disabled.
(l) Disabled will have the same meaning as set forth in Section 22(e)(3) of the
Code.
(m) Exchange Act means the Securities Exchange Act of 1934, as amended.
(n) Fair Market Value means, as of any date: (i) if the Shares are not then publicly
traded, the value of such Shares on that date, as determined by the Board in its sole and absolute
discretion; or (ii) if the Shares are publicly traded, the closing price for a Share on the
principal national securities exchange on which the Shares are listed or admitted to trading or, if
the Shares are not listed or admitted to trading on any national securities exchange, but are
traded in the over-the-counter market, the closing sale price of a Share or, if no sale is publicly
reported, the average of the closing bid and asked prices, as furnished by two members of the
National Association of Securities Dealers, Inc. who make a market in the Shares selected from time
to time by the Company for that purpose. Notwithstanding the foregoing, in connection with a
Change in Control, Fair Market Value shall be determined in good faith by the Board, such
determination by the Board to be final conclusive and binding.
(o) Incentive Stock Option means any Option intended to be an Incentive Stock
Option within the meaning of Section 422 of the Code.
(p) Non-Employee Director will have the meaning set forth in Rule 16b-3(b)(3)(i)
promulgated by the Securities and Exchange Commission under the Exchange Act, or any successor
definition adopted by the Securities and Exchange Commission; provided, however, that the Board or
the Committee may, to the extent that it deems necessary to comply with Section 162(m) of the Code
or regulations thereunder, require that each Non-Employee Director also be an outside director
as that term is defined in regulations under Section 162(m).
(q) Non-Qualified Stock Option means any Option that is not an Incentive Stock
Option.
(r) Option means any option to purchase Shares (including Restricted Stock, if the
Board so determines) granted pursuant to Section 5 hereof.
(s) Parent means, in respect of the Company, a parent corporation as defined in
Sections 424(e) of the Code.
Ex.-2
(t) Participant means an employee, consultant, Director, or other service provider
of or to the Company or any of its respective Affiliates to whom an Award is granted.
(u) Performance Award means Shares or other Awards that, pursuant to Section
10, are granted, vested and/or settled upon the achievement of specified performance
conditions.
(v) Person means an individual, partnership, corporation, limited liability company,
trust, joint venture, unincorporated association, or other entity or association.
(w) Restricted Stock means Shares that are subject to restrictions pursuant to
Section 8 hereof.
(x) Restricted Stock Unit means a right granted under and subject to restrictions
pursuant to Section 9 hereof.
(y) SAR means a stock appreciation right granted under the Plan and described in
Section 6 hereof.
(z) Shares means shares of the Companys common stock, no par value, subject to
substitution or adjustment as provided in Section 3(c) hereof.
(aa) Subsidiary means, in respect of the Company, a subsidiary company as defined in
Sections 424(f) and (g) of the Code.
Section 2. Administration. The Plan will be administered by the Board; provided,
however, that the Board may at any time appoint a Committee to perform some or all of the Boards
administrative functions hereunder; and provided further, that the authority of any Committee
appointed pursuant to this Section 2 will be subject to such terms and conditions as the Board may
prescribe and will be coextensive with, and not in lieu of, the authority of the Board hereunder.
Subject to the requirements of the Companys by-laws and certificate of incorporation and any other
agreement that governs the appointment of Board committees, the Committee will be composed of at
least one member, who will serve for such period of time as the Board determines.
The Board will have full authority to grant Awards under this Plan and determine the terms of
such Awards. Such authority will include the right to:
(a) select the individuals to whom Awards are granted (consistent with the eligibility
conditions set forth in Section 4);
(b) determine the type of Award to be granted;
(c) determine the number of Shares, if any, to be covered by each Award;
(d) establish the terms and conditions of each Award;
(e) establish the performance conditions relevant to any Award and certify whether such
performance conditions have been satisfied;
(f) determine whether and under what circumstances an Option may be exercised without a
payment of cash under Section 5(d);
Ex.-3
(g) to accelerate the vesting or exercisability of an Award and to modify or amend each Award,
subject to Section 11;
(h) to extend the period of time for which an Option or SAR is to remain exercisable following
a Participants termination of service to the Company from the limited period otherwise in effect
for that Option or SAR to such greater period of time as the Board deems appropriate, but in no
event beyond the expiration of the term of the Option or SAR; and
(i) determine whether, to what extent and under what circumstances Shares and other amounts
payable with respect to an Award may be deferred either automatically or at the election of the
Participant.
The Board will have the authority to adopt, alter and repeal such administrative rules,
guidelines and practices governing the Plan as it, from time to time, deems advisable; to establish
the terms and form of each Award Agreement; to interpret the terms and provisions of the Plan and
any Award issued under the Plan (and any Award Agreement); and to otherwise supervise the
administration of the Plan. The Board may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or in any Award Agreement in the manner and to the extent it deems
necessary to carry out the intent of the Plan.
All decisions made by the Board pursuant to the provisions of the Plan will be final and
binding on all Persons, including the Company and Participants. No Director will be liable for any
good faith determination, act or omission in connection with the Plan or any Award.
Section 3. Shares Subject to the Plan.
(a) Shares Subject to the Plan. The Shares to be subject to or related to Awards
under the Plan will be authorized and unissued Shares of the Company, whether or not previously
issued and subsequently acquired by the Company. The maximum number of Shares that may be issued
in respect of Awards under the Plan is 250,000 shares, all of which may be issued in respect of
Incentive Stock Options. The Company will reserve for the purposes of the Plan, out of its
authorized and unissued Shares, such number of Shares.
(b) Effect of the Expiration or Termination of Awards. If and to the extent that an
Option or SAR expires, terminates or is canceled or forfeited for any reason without having been
exercised in full, the Shares associated with that Option or SAR will again become available for
grant under the Plan. Similarly, if and to the extent an Award of Restricted Stock, Restricted
Stock Units or a Performance Award is canceled or forfeited for any reason, the Shares subject to
that Award will again become available for grant under the Plan. Shares withheld in settlement of
a tax withholding obligation associated with an Award, or in satisfaction of the exercise price
payable upon exercise of an Option, will again become available for grant under the Plan. If any
Award or portion thereof is settled for cash, the Shares attributable for such cash settlement will
again become available for grant.
(c) Other Adjustment. In the event of any recapitalization, stock split or
combination, stock dividend, spin-off, merger, reorganization or other similar event or transaction
affecting the Shares, substitutions or adjustments will be made by the Board to the aggregate
number, class and/or issuer of the securities that may be issued under the Plan, to the number,
class and/or issuer of securities subject to outstanding Awards, and to the exercise price of
outstanding Options or SARs, in each case in a manner that reflects equitably the effects of such
event or transaction.
Ex.-4
(d) Change in Control. Notwithstanding anything to the contrary set forth in the
Plan, upon or in anticipation of any Change in Control, the Board may, in its sole and absolute
discretion
and without the need for the consent of any Participant, take one or more of the following
actions contingent upon the occurrence of that Change in Control:
(i) cause any or all outstanding Awards to become vested and immediately exercisable
(as applicable), in whole or in part;
(ii) cause any outstanding Option to become fully vested and immediately exercisable
for a reasonable period in advance of the Change in Control and, to the extent not exercised
prior to that Change in Control, cancel that Option upon closing of the Change in Control;
(iii) cancel any unvested Award or unvested portion thereof, with or without
consideration;
(iv) cancel any Option in exchange for a substitute award in a manner consistent with
the principles of Treas. Reg. §1.424-1(a) or any successor rule or regulation
(notwithstanding the fact that the original Award may never have been intended to satisfy
the requirements for treatment as an Incentive Stock Option);
(v) cancel any Restricted Stock, Restricted Stock Unit or SAR in exchange for
restricted shares, restricted stock units or stock appreciation rights with respect to the
capital stock of any successor corporation or its parent;
(vi) redeem any Restricted Stock or Restricted Stock Unit for cash and/or other
substitute consideration with value equal to Fair Market Value of an unrestricted Share on
the date of the Change in Control;
(vii) cancel any SAR in exchange for cash and/or other substitute consideration with a
value equal to: (A) the number of Shares subject to that SAR, multiplied by (B) the
difference, if any, between the Fair Market Value per Share on the date of the Change in
Control and the exercise price of that SAR; provided, that if the Fair Market Value per
Share on the date of the Change in Control does not exceed the exercise price of any such
SAR, the Board may cancel that SAR without any payment of consideration therefore; and/or
(viii) cancel any Option in exchange for cash and/or other substitute consideration
with a value equal to: (A) the number of Shares subject to that Option, multiplied by (B)
the difference, if any, between the Fair Market Value per Share on the date of the Change in
Control and the exercise price of that Option; provided, that if the Fair Market Value per
Share on the date of the Change in Control does not exceed the exercise price of any such
Option, the Board may cancel that Option without any payment of consideration therefor.
In the discretion of the Board, any cash or substitute consideration payable upon cancellation
of an Award may be subjected to (i) vesting terms substantially identical to those that applied to
the cancelled Award immediately prior to the Change in Control, or (ii) earn-out, escrow, holdback
or similar arrangements, to the extent such arrangements are applicable to any consideration paid
to stockholders in connection with the Change in Control.
Section 4. Eligibility. Employees, Directors, consultants, and other individuals who
provide services to the Company or its Affiliates are eligible to be granted Awards under the Plan;
provided, however, that only employees of the Company, any Parent or a Subsidiary are eligible to
be granted Incentive Stock Options.
Ex.-5
Section 5. Options. Options granted under the Plan may be of two types: (i) Incentive
Stock Options or (ii) Non-Qualified Stock Options. Any Option granted under the Plan will be in
such form as the Board may at the time of such grant approve.
The Award Agreement evidencing any Option will incorporate the following terms and conditions
and will contain such additional terms and conditions, not inconsistent with the terms of the Plan,
as the Board deems appropriate in its sole and absolute discretion:
(a) Option Price. The exercise price per Share purchasable under an Option will be
determined by the Board and will not be less than 100% of the Fair Market Value of a Share on the
date of the grant. However, any Incentive Stock Option granted to any Participant who, at the time
the Option is granted, owns, either directly or within the meaning of the attribution rules
contained in Section 424(d) of the Code, stock possessing more than 10% of the total combined
voting power of all classes of stock of the Company, will have an exercise price per Share of not
less than 110% of Fair Market Value per Share on the date of the grant.
(b) Option Term. The term of each Option will be fixed by the Board, but no Option
will be exercisable more than 10 years after the date the Option is granted. However, any
Incentive Stock Option granted to any Participant who, at the time such Option is granted, owns,
either directly or within the meaning of the attribution rules contained in Section 424(d) of the
Code, stock possessing more than 10% of the total combined voting power of all classes of stock of
the Company, may not have a term of more than five years. No Option may be exercised by any Person
after expiration of the term of the Option.
(c) Exercisability. Options will vest and be exercisable at such time or times and
subject to such terms and conditions as determined by the Board.
(d) Method of Exercise. Subject to the terms of the applicable Award Agreement, the
exercisability provisions of Section 5(c) and the termination provisions of Section
7, Options may be exercised in whole or in part from time to time during their term by the
delivery of written notice to the Company specifying the number of Shares to be purchased. Such
notice will be accompanied by payment in full of the purchase price, either by certified or bank
check, or such other means as the Board may accept. Unless otherwise determined by the Board, in
its sole discretion, payment of the exercise price of an Option may be made in the form of
previously acquired Shares based on the Fair Market Value of the Shares on the date the Option is
exercised or through means of a net settlement, whereby the Option exercise price will not be due
in cash and where the number of Shares issued upon such exercise will be equal to: (A) the product
of (i) the number of Shares as to which the Option is then being exercised, and (ii) the excess, if
any, of (a) the then current Fair Market Value per Share over (b) the Option exercise price,
divided by (B) the then current Fair Market Value per Share.
No Shares will be issued upon exercise of an Option until full payment therefor has been made.
A Participant will not have the right to distributions or dividends or any other rights of a
stockholder with respect to Shares subject to the Option until the Participant has given written
notice of exercise, has paid in full for such Shares, if requested, has given the representation
described in Section 14(a) hereof and fulfills such other conditions as may be set forth in
the applicable Award Agreement.
(e) Incentive Stock Option Limitations. In the case of an Incentive Stock Option, the
aggregate Fair Market Value (determined as of the time of grant) of the Shares with respect to
which Incentive Stock Options are exercisable for the first time by the Participant during any
calendar year under the Plan and/or any other plan of the Company, its Parent or any Subsidiary
will not exceed $100,000. For purposes of applying the foregoing limitation, Incentive Stock
Options will be taken into
account in the order granted. To the extent any Option does not meet such limitation, that
Option will be treated for all purposes as a Non-Qualified Stock Option.
Ex.-6
(f) Termination of Service. Unless otherwise specified in the applicable Award
Agreement, Options will be subject to the terms of Section 7 with respect to exercise upon
or following termination of employment or other service.
(g) Transferability of Options. Except as may otherwise be specifically determined by
the Board with respect to a particular Option: (i) no Option will be transferable by the
Participant other than by will or by the laws of descent and distribution, and (ii) during the
Participants lifetime, an Option will be exercisable only by the Participant (or, in the event of
the Participants Disability, by his personal representative).
Section 6. Stock Appreciation Rights.
(a) Nature of Award. Upon the exercise of a SAR, its holder will be entitled to
receive an amount equal to the excess (if any) of: (i) the Fair Market Value of the Shares covered
by such SAR as of the date such SAR is exercised, over (ii) the Fair Market Value of the Shares
covered by such SAR as of the date such SAR was granted. Such amount may be paid in either cash
and/or Shares, as determined by the Board in its sole and absolute discretion.
(b) Terms and Conditions. The Award Agreement evidencing any SAR will incorporate the
following terms and conditions and will contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as the Board deems appropriate in its sole and absolute
discretion:
(i) Term of SAR. Unless otherwise specified in the Award Agreement, the term
of a SAR will be ten years.
(ii) Exercisability. SARs will vest and become exercisable at such time or
times and subject to such terms and conditions as will be determined by the Board at the
time of grant.
(iii) Method of Exercise. Subject to terms of the applicable Award Agreement,
the exercisability provisions of Section 6(b)(ii) and the termination provisions of
Section 7, SARs may be exercised in whole or in part from time to time during their
term by delivery of written notice to the Company specifying the portion of the SAR to be
exercised.
(iv) Termination of Service. Unless otherwise specified in the Award
Agreement, SARs will be subject to the terms of Section 7 with respect to exercise
upon termination of employment or other service.
(v) Non-Transferability. Except as may otherwise be specifically determined by
the Board with respect to a particular SAR: (A) SARs may not be sold, pledged, assigned,
hypothecated, gifted, transferred or disposed of in any manner either voluntarily or
involuntarily by operation of law, other than by will or by the laws of descent or
distribution, and (B) during the Participants lifetime, SARs will be exercisable only by
the Participant (or, in the event of the Participants Disability, by his personal
representative).
Ex.-7
Section 7. Termination of Service. Unless otherwise specified with respect to a
particular Option or SAR in the applicable Award Agreement or otherwise determined by the Board,
any portion of an Option or SAR that is not exercisable upon termination of service will expire
immediately and
automatically upon such termination and any portion of an Option or SAR that is exercisable
upon termination of service will expire on the date it ceases to be exercisable in accordance with
this Section 7.
(a) Termination by Reason of Death. If a Participants service with the Company or
any Affiliate terminates by reason of death, any Option or SAR held by such Participant may
thereafter be exercised, to the extent it was exercisable at the time of his or her death or on
such accelerated basis as the Board may determine at or after grant, by the legal representative of
the estate or by the legatee of the Participant under the will of the Participant, for a period
expiring (i) at such time as may be specified by the Board at or after grant, or (ii) if not
specified by the Board, then 12 months from the date of death, or (iii) if sooner than the
applicable period specified under (i) or (ii) above, upon the expiration of the stated term of such
Option or SAR.
(b) Termination by Reason of Disability. If a Participants service with the Company
or any Affiliate terminates by reason of Disability, any Option or SAR held by such Participant may
thereafter be exercised by the Participant or his personal representative, to the extent it was
exercisable at the time of termination, or on such accelerated basis as the Board may determine at
or after grant, for a period expiring (i) at such time as may be specified by the Board at or after
grant, or (ii) if not specified by the Board, then 12 months from the date of termination of
service, or (iii) if sooner than the applicable period specified under (i) or (ii) above, upon the
expiration of the stated term of such Option or SAR.
(c) Cause. If a Participants service with the Company or any Affiliate is terminated
for Cause: (i) any Option or SAR, or portion thereof, not already exercised will be immediately and
automatically forfeited as of the date of such termination, and (ii) any Shares for which the
Company has not yet delivered share certificates will be immediately and automatically forfeited
and the Company will refund to the Participant the Option exercise price paid for such Shares, if
any.
(d) Other Termination. If a Participants service with the Company or any Affiliate
terminates for any reason other than death, Disability or Cause, any Option or SAR held by such
Participant may thereafter be exercised by the Participant, to the extent it was exercisable at the
time of such termination, or on such accelerated basis as the Board may determine at or after
grant, for a period expiring (i) at such time as may be specified by the Board at or after grant,
or (ii) if not specified by the Board, then 90 days from the date of termination of service, or
(iii) if sooner than the applicable period specified under (i) or (ii) above, upon the expiration
of the stated term of such Option or SAR.
Section 8. Restricted Stock.
(a) Issuance. Restricted Stock may be issued either alone or in conjunction with
other Awards. The Board will determine the time or times within which Restricted Stock may be
subject to forfeiture, and all other conditions of such Awards. The purchase price for Restricted
Stock may, but need not, be zero. The prospective recipient of an Award of Restricted Stock will
not have any rights with respect to such Award, unless and until such recipient has delivered to
the Company an executed Award Agreement and has otherwise complied with the applicable terms and
conditions of such Award.
(b) Certificates. Any share certificate issued in connection with an Award of
Restricted Stock will be registered in the name of the Participant receiving the Award, and will
bear the following legend and/or any other legend required by this Plan, the Award Agreement or by
Applicable Law:
THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES REPRESENTED
HEREBY ARE SUBJECT TO THE
TERMS AND CONDITIONS OF THE BANCORP OF NEW JERSEY, INC. 2011 EQUITY
INCENTIVE PLAN AND AN AWARD AGREEMENT ENTERED INTO BETWEEN THE
PARTICIPANT AND BANCORP OF NEW JERSEY, INC. COPIES OF THAT PLAN AND
AGREEMENT ARE ON FILE IN THE PRINCIPAL OFFICES OF BANCORP OF NEW
JERSEY, INC. AND WILL BE MADE AVAILABLE TO THE HOLDER OF THIS
CERTIFICATE WITHOUT CHARGE UPON REQUEST TO THE SECRETARY OF BANCORP
OF NEW JERSEY, INC.
Ex.-8
Share certificates evidencing Restricted Stock will be held in custody by the Company or in
escrow by an escrow agent until the restrictions thereon have lapsed. As a condition to any Award
of Restricted Stock, the Participant may be required to deliver to the Company a share power,
endorsed in blank, relating to the Shares covered by such Award.
(c) Restrictions and Conditions. The Award Agreement evidencing the grant of any
Restricted Stock will incorporate the following terms and conditions and such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Board deems appropriate in its sole
and absolute discretion:
(i) During a period commencing with the date of an Award of Restricted Stock and ending
at such time or times as specified by the Board (the Restriction Period), the
Participant will not be permitted to sell, transfer, pledge, assign or otherwise encumber
Restricted Stock awarded under the Plan. The Board may condition the lapse of restrictions
on Restricted Stock upon the continued employment or service of the recipient, the
attainment of specified individual or corporate performance goals, or such other factors as
the Board may determine, in its sole and absolute discretion.
(ii) Except as provided in this paragraph (ii) or the applicable Award Agreement, once
the Participant has been issued a certificate or certificates for Restricted Stock or the
Restricted Stock has been issued in the Participants name by book-entry registration, the
Participant will have, with respect to the Restricted Stock, the right to vote the Shares,
but will not have the right to receive any cash distributions or dividends prior to the
lapse of the Restriction Period unless otherwise provided under the applicable Award
Agreement or as determined by the Board. If any cash distributions or dividends are payable
with respect to the Restricted Stock, the Board, in its sole discretion, may require the
cash distributions or dividends to be subjected to the same Restriction Period as is
applicable to the Restricted Stock with respect to which such amounts are paid, or, if the
Board so determines, reinvested in additional Restricted Stock to the extent Shares are
available under Section 3(a) of the Plan. A Participant shall not be entitled to
interest with respect to any dividends or distributions subjected to the Restriction Period.
Any distributions or dividends paid in the form of securities with respect to Restricted
Stock will be subject to the same terms and conditions as the Restricted Stock with respect
to which they were paid, including, without limitation, the same Restriction Period.
(iii) Subject to the provisions of the applicable Award Agreement or as otherwise
determined by the Board, if a Participants service with the Company and its Affiliates
terminates prior to the expiration of the applicable Restriction Period, the Participants
Restricted Stock that then remains subject to forfeiture will then be forfeited
automatically.
(iv) If and when the Restriction Period expires without a prior forfeiture of the
Restricted Stock subject to such Restriction Period (or if and when the restrictions
applicable
to Restricted Stock are removed pursuant to Section 3(d) or otherwise), any
certificates for such Shares will be replaced with new certificates, without the restrictive
legends described in Section 8(b) applicable to such lapsed restrictions, and such
new certificates will be delivered to the Participant, the Participants representative (if
the Participant has suffered a Disability), or the Participants estate or heir (if the
Participant has died).
Ex.-9
Section 9. Restricted Stock Units. Subject to the other terms of the Plan, the Board
may grant Restricted Stock Units to eligible individuals and may, in its sole and absolute
discretion, impose conditions on such units as it may deem appropriate, including, without
limitation, continued employment or service of the recipient or the attainment of specified
individual or corporate performance goals. Each Restricted Stock Unit shall be evidenced by an
Award Agreement in the form that is approved by the Board and that is not inconsistent with the
terms and conditions of the Plan. Each Restricted Stock Unit will represent a right to receive
from the Company, upon fulfillment of any applicable conditions, an amount equal to the Fair Market
Value (at the time of the distribution) of one Share. Distributions may be made in cash and/or
Shares. All other terms governing Restricted Stock Units, such as vesting, time and form of
payment and termination of units shall be set forth in the applicable Award Agreement. The
Participant shall not have any shareholder rights with respect to the Shares subject to a
Restricted Stock Unit Award until that Award vests and the Shares are actually issued thereunder.
A Participant will not be permitted to sell, transfer, pledge, assign or otherwise encumber
Restricted Stock Units awarded under the Plan. Subject to the provisions of the applicable Award
Agreement or as otherwise determined by the Board, if a Participants service with the Company
terminates prior to the Restricted Stock Unit Award vesting, the Participants Restricted Stock
Units that then remain subject to forfeiture will then be forfeited automatically.
Section 10. Performance Awards.
(a) Performance Awards Generally. The Board may grant Performance Awards in accordance
with this Section 10. Performance Awards may be denominated as a number of Shares, a
dollar amount, or specified number of other Awards (or a combination thereof) which may be earned
upon achievement or satisfaction of performance conditions specified by the Board. In addition,
the Board may specify that any other Award shall constitute a Performance Award by conditioning the
vesting or settlement of the Award upon the achievement or satisfaction of such performance
conditions as may be specified by the Board. Subject to Section 10(b), the Board may use
such business criteria or other measures of performance as it may deem appropriate in establishing
the relevant performance conditions and may, in its discretion, adjust such criteria from time to
time.
(b) Qualified Performance-Based Compensation Under Section 162(m). Performance Awards
intended to constitute qualified performance-based compensation under Section 162(m) of the Code
will be granted by a compensation committee of the Board consisting solely of at least two
individuals who are intended to qualify as outside directors within the meaning of Section 162(m)
of the Code (or any successor section thereto) and will be subject to the terms of this Section
10(b). In accordance with the requirements under Section 162(m) of the Code, the maximum
number of Shares underlying Performance Awards denominated in shares that may be granted during a
calendar year to any Participant shall be 150,000 and the maximum dollar value of Performance
Awards denominated in cash that may be granted during a calendar year to any Participant shall be
$1,000,000.
Ex.-10
(i) Specified Business Criteria. The grant, vesting and/or settlement of a
Performance Award subject to this Section 10(b) will be contingent upon achievement
of one or more of the following business criteria (subject to adjustment in accordance with
Section 10(b)(ii), below):
(1) the attainment of certain target levels of, or a specified percentage
increase in: revenues, income before taxes and extraordinary items, net income,
operating income, earnings before income tax, earnings before interest, taxes,
depreciation and amortization, earning per share, after-tax or pre-tax profits,
operational cash flow, return on capital employed or returned on invested capital,
after-tax or pre-tax return on stockholders equity, the price of the Companys
common stock or a combination of the foregoing;
(2) the achievement of a certain level of, reduction of, or other specified
objectives with regard to limiting the level of increase in, the Companys bank debt
or other public or private debt or financial obligations;
(3) the attainment of a certain level of, reduction of, or other specified
objectives with regard to limiting the level in or increase in all or a portion of
controllable expenses or costs or other expenses or costs; and/or
(4) any other objective business criteria that would not cause an Award to fail
to constitute qualified performance-based compensation under Section 162(m) of the
Code.
Performance goals may be established on a Company-wide basis or with respect to one or more
business units, divisions, Affiliates, or products, and in either absolute terms or relative to the
performance of one or more comparable companies or an index covering multiple companies. The
performance goals for a particular performance period need not be the same for all Participants.
(ii) Adjustments to Performance Goals. The committee described in Section
10(b) may provide, at the time performance goals are established in accordance with
Section 10(b)(i), that adjustments will be made to those performance goals to take
into account, in any objective manner specified by that committee, the impact of one or more
of the following: (A) gain or loss from all or certain claims and/or litigation and
insurance recoveries, (B) the impairment of tangible or intangible assets, (C) stock-based
compensation expense, (D) restructuring activities reported in the Companys public filings,
(E) investments, dispositions or acquisitions, (F) loss from the disposal of certain assets,
(G) gain or loss from the early extinguishment, redemption, or repurchase of debt, (H)
changes in accounting principles, or (I) any other item, event or circumstance that would
not cause an Award to fail to constitute qualified performance-based compensation under
Section 162(m) of the Code. An adjustment described in this Section 10(b)(ii) may
relate to the Company or to any subsidiary, division or other operational unit of the
Company or its Affiliates, as determined by the committee at the time the performance goals
are established. Any adjustment shall be determined in accordance with generally accepted
accounting principles and standards, unless such other objective method of measurement is
designated by the committee at the time performance objectives are established. In
addition, adjustments will be made as necessary to any performance criteria related to the
Companys stock to reflect changes in corporate capitalization, including a
recapitalization, stock split or combination, stock dividend, spin-off, merger,
reorganization or other similar event or transaction affecting the Companys equity.
(c) Other Terms of Performance Awards. The Board may specify other terms pertinent to
a Performance Award in the applicable Award Agreement, including terms relating to the treatment of
that Award in the event of a Change in Control prior to the end of the applicable performance
period. The Participant shall not have any shareholder rights with respect to the Shares subject
to a Performance Award until the Shares are actually issued thereunder. A Participant will not be
permitted to
sell, transfer, pledge, assign or otherwise encumber Performance Awards. Subject to the
provisions of the applicable Award Agreement or as otherwise determined by the Board, if a
Participants service with the Company terminates prior to the Performance Award vesting, the
Participants Performance Award or portion thereof that then remains subject to forfeiture will
then be forfeited automatically.
Ex.-11
Section 11. Amendments and Termination. The Board may amend, alter or discontinue the
Plan at any time. However, except as otherwise provided in Section 3, no amendment,
alteration or discontinuation will be made which would impair the rights of a Participant with
respect to an Award without that Participants consent or which, without the approval of such
amendment within 365 days of its adoption by the Board by the Companys stockholders in a manner
consistent with Treas. Reg. § 1.422-3 (or any successor provision), would: (i) increase the total
number of Shares reserved for issuance hereunder, or (ii) change the persons or class of persons
eligible to receive Awards.
Section 12. Conditions Upon Grant of Awards and Issuance of Shares.
(a) The implementation of the Plan, the grant of any Award and the issuance of Shares in
connection with the issuance, exercise or vesting of any Award made under the Plan shall be subject
to the Companys procurement of all approvals and permits required by regulatory authorities having
jurisdiction over the Plan, the Awards made under the Plan and the Shares issuable pursuant to
those Awards.
(b) No Shares or other assets shall be issued or delivered under the Plan unless and until
there shall have been compliance with all applicable requirements of Applicable Law, including the
filing and effectiveness of the Form S-8 registration statement for the Shares issuable under the
Plan, and all applicable listing requirements of any stock exchange on which Shares are then listed
for trading.
Section 13. Liability of Company.
(a) Inability to Obtain Authority. If the Company cannot, by the exercise of
commercially reasonable efforts, obtain authority from any regulatory body having jurisdiction for
the sale of any Shares under this Plan, and such authority is deemed by the Companys counsel to be
necessary to the lawful issuance of those Shares, the Company will be relieved of any liability for
failing to issue or sell those Shares.
(b) Grants Exceeding Allotted Shares. If Shares subject to an Award exceed, as of the
date of grant, the number of Shares which may be issued under the Plan without additional
shareholder approval, that Award will be contingent with respect to such excess Shares, on the
effectiveness under Applicable Law of a sufficient increase in the number of Shares subject to this
Plan.
(c) Rights of Participants and Beneficiaries. The Company will pay all amounts
payable under this Plan only to the applicable Participant, or beneficiaries entitled thereto
pursuant to this Plan. The Company will not be liable for the debts, contracts, or engagements of
any Participant or his or her beneficiaries, and rights to cash payments under this Plan may not be
taken in execution by attachment or garnishment, or by any other legal or equitable proceeding
while in the hands of the Company.
Section 14. General Provisions.
(a) The Board may require each Participant to represent to and agree with the Company in
writing that the Participant is acquiring securities of the Company for investment purposes and
without a view to distribution thereof and as to such other matters as the Board believes are
appropriate. Any certificate evidencing an Award and any securities issued pursuant thereto
may include any legend which the Board deems appropriate to reflect any restrictions on transfer
and compliance with Applicable Law.
Ex.-12
(b) All certificates for Shares or other securities delivered under the Plan will be subject
to such share-transfer orders and other restrictions as the Board may deem advisable under the
rules, regulations and other requirements of the Securities Act of 1933, as amended, the Exchange
Act, any stock exchange upon which the Shares are then listed, and any other Applicable Law, and
the Board may cause a legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.
(c) Neither the adoption of the Plan nor the execution of any document in connection with the
Plan will: (i) confer upon any employee or other service provider of the Company or an Affiliate
any right to continued employment or engagement with the Company or such Affiliate, or (ii)
interfere in any way with the right of the Company or such Affiliate to terminate the employment or
engagement of any of its employees or other service providers at any time.
(d) No later than the date as of which an amount first becomes includible in the gross income
of the Participant for federal income tax purposes with respect to any Award under the Plan, the
Participant will pay to the Company, or make arrangements satisfactory to the Company regarding the
payment of, any federal, state or local taxes of any kind required by law to be withheld with
respect to such amount. Unless otherwise determined by the Board, the minimum required withholding
obligations may be settled with Shares, including Shares that are part of the Award that gives rise
to the withholding requirement. The obligations of the Company under the Plan will be conditioned
on such payment or arrangements and the Company will have the right to deduct any such taxes from
any payment of any kind otherwise due to the Participant.
Section 15. Effective Date of Plan. The Plan will become effective on the date that
it is duly approved by the Companys stockholders.
Section 16. Term of Plan. The Plan will continue in effect until terminated in
accordance with Section 11; provided, however, that no Incentive Stock Option will be
granted hereunder on or after the 10th anniversary of the date of stockholder approval of the Plan
(or, if the stockholders approve an amendment that increases the number of shares subject to the
Plan, the 10th anniversary of the date of such approval); but provided further, that
Incentive Stock Options granted prior to such 10th anniversary may extend beyond that
date.
Section 17. Invalid Provisions. In the event that any provision of this Plan is found
to be invalid or otherwise unenforceable under any Applicable Law, such invalidity or
unenforceability will not be construed as rendering any other provisions contained herein as
invalid or unenforceable, and all such other provisions will be given full force and effect to the
same extent as though the invalid or unenforceable provision was not contained herein.
Section 18. Governing Law. The Plan and all Awards granted hereunder will be governed
by and construed in accordance with the laws and judicial decisions of the State of New Jersey,
without regard to the application of the principles of conflicts of laws.
Ex.-13
Section 19. Board Action. Notwithstanding anything to the contrary set forth in the
Plan, any and all actions of the Board or Committee, as the case may be, taken under or in
connection with the Plan and any agreements, instruments, documents, certificates or other writings
entered into, executed, granted, issued and/or delivered pursuant to the terms hereof, will be
subject to and limited by any and all
votes, consents, approvals, waivers or other actions of all or certain stockholders of the
Company or other persons required by:
(a) the Companys Certificate of Incorporation (as the same may be amended and/or restated
from time to time);
(b) the Companys Bylaws (as the same may be amended and/or restated from time to time); and
(c) any other agreement, instrument, document or writing now or hereafter existing, between or
among the Company and its stockholders or other Persons (as the same may be amended from time to
time).
Section 20. Notices. Any notice to be given to the Company pursuant to the provisions
of this Plan must be given in writing and addressed, if to the Company, to its principal executive
office to the attention of its Chief Financial Officer (or such other Person as the Company may
designate in writing from time to time), and, if to a Participant, to the address contained in the
Companys personnel files, or at such other address as that Participant may hereafter designate in
writing to the Company. Any such notice will be deemed duly given: if delivered personally or via
recognized overnight delivery service, on the date and at the time so delivered; if sent via
telecopier or email, on the date and at the time telecopied or emailed with confirmation of
delivery; or, if mailed, five (5) days after the date of mailing by registered or certified mail.
Ex.-14