Exhibit 10.1
OCWEN
FINANCIAL CORPORATION
2017
PERFORMANCE INCENTIVE PLAN
The
purpose of this Ocwen Financial Corporation 2017 Performance Incentive Plan (this “Plan”) of Ocwen Financial
Corporation, a Florida corporation (the “Corporation”), is to promote the success of the Corporation by providing
an additional means through the grant of awards to attract, motivate, retain and reward selected employees and other eligible
persons and to enhance the alignment of the interests of the selected participants with the interests of the Corporation’s
stockholders.
The
Administrator (as such term is defined in Section 3.1) may grant awards under this Plan only to those persons that the Administrator
determines to be Eligible Persons. An “Eligible Person” is any person who is either: (a) an officer (whether
or not a director) or employee of the Corporation or one of its Subsidiaries; (b) a director of the Corporation or one of its
Subsidiaries; or (c) an individual consultant or advisor who renders or has rendered bona fide services (other than services in
connection with the offering or sale of securities of the Corporation or one of its Subsidiaries in a capital-raising transaction
or as a market maker or promoter of securities of the Corporation or one of its Subsidiaries) to the Corporation or one of its
Subsidiaries and who is selected to participate in this Plan by the Administrator; provided, however, that a person who is otherwise
an Eligible Person under clause (c) above may participate in this Plan only if such participation would not adversely affect either
the Corporation’s eligibility to use Form S-8 to register under the Securities Act of 1933, as amended (the “Securities
Act”), the offering and sale of shares issuable under this Plan by the Corporation or the Corporation’s compliance
with any other applicable laws. An Eligible Person who has been granted an award (a “participant”) may, if otherwise
eligible, be granted additional awards if the Administrator shall so determine. As used herein, “Subsidiary”
means any corporation or other entity a majority of whose outstanding voting stock or voting power is beneficially owned directly
or indirectly by the Corporation; and “Board” means the Board of Directors of the Corporation.
| 3.1 | The
Administrator. This Plan shall be administered by and all awards under this Plan
shall be authorized by the Administrator. The “Administrator” means
the Board or one or more committees (or subcommittees, as the case may be) appointed
by the Board or another committee (within its delegated authority) to administer all
or certain aspects of this Plan. Any such committee shall be comprised solely of one
or more directors or such number of directors as may be required under applicable law.
A committee may delegate some or all of its authority to another committee so constituted.
The Board or a committee comprised solely of directors may also delegate, to the extent
permitted by applicable law, to one or more officers of the Corporation, its authority
under this Plan. The Board or another committee (within its delegated authority) may
delegate different levels of authority to different committees or persons with administrative
and grant authority under this Plan. Unless otherwise provided in the Bylaws of the Corporation
or the applicable charter of any Administrator: (a) a majority of the members of the
acting Administrator shall constitute a quorum, and (b) the vote of a majority of the
members present assuming the presence of a quorum or the unanimous written consent of
the members of the Administrator shall constitute action by the acting Administrator. |
| 3.2 | Powers
of the Administrator. Subject to the express provisions of this Plan, the Administrator
is authorized and empowered to do all things necessary or desirable in connection with
the authorization of awards and the administration of this Plan (in the case of a committee
or delegation to one or more officers, within any express limits on the authority delegated
to that committee or person(s)), including, without limitation, the authority to: |
| (a) | determine
eligibility and, from among those persons determined to be eligible, determine the particular
Eligible Persons who will receive an award under this Plan; |
| (b) | grant
awards to Eligible Persons, determine the price (if any) at which securities will be
offered or awarded and the number of securities to be offered or awarded to any of such
persons (in the case of securities-based awards), determine the other specific terms
and conditions of awards consistent with the express limits of this Plan, establish the
installments (if any) in which such awards shall become exercisable or shall vest (which
may include, without limitation, performance and/or time-based schedules), or determine
that no delayed exercisability or vesting is required, establish any applicable performance-based
exercisability or vesting requirements, determine the extent (if any) to which any applicable
exercise and vesting requirements have been satisfied, and establish the events (if any)
of termination, expiration or reversion of such awards; |
| (c) | approve
the forms of any award agreements (which need not be identical either as to type of award
or among participants); |
| (d) | construe
and interpret this Plan and any agreements defining the rights and obligations of the
Corporation, its Subsidiaries, and participants under this Plan, make any and all determinations
under this Plan and any such agreements, further define the terms used in this Plan,
and prescribe, amend and rescind rules and regulations relating to the administration
of this Plan or the awards granted under this Plan; |
| (e) | cancel,
modify, or waive the Corporation’s rights with respect to, or modify, discontinue,
suspend, or terminate any or all outstanding awards, subject to any required consent
under Section 8.6.5; |
| (f) | accelerate,
waive or extend the vesting or exercisability, or modify or extend the term of, any or
all such outstanding awards (in the case of options or stock appreciation rights, within
the maximum ten-year term of such awards) in such circumstances as the Administrator
may deem appropriate (including, without limitation, in connection with a termination
of employment or services or other events of a personal nature) subject to any required
consent under Section 8.6.5; |
| (g) | adjust
the number of shares of Common Stock subject to any award, adjust the price of any or
all outstanding awards or otherwise waive or change previously imposed terms and conditions,
in such circumstances as the Administrator may deem appropriate, in each case subject
to Sections 4 and 8.6 (and subject to the no repricing provision below); |
| (h) | determine
the date of grant of an award, which may be a designated date after but not before the
date of the Administrator’s action to approve the award (unless otherwise designated
by the Administrator, the date of grant of an award shall be the date upon which the
Administrator took the action approving the award); |
| (i) | determine
whether, and the extent to which, adjustments are required pursuant to Section 7.1 hereof
and take any other actions contemplated by Section 7 in connection with the occurrence
of an event of the type described in Section 7; |
| (j) | acquire
or settle (subject to Sections 7 and 8.6) rights under awards in cash, stock of equivalent
value, or other consideration (subject to the no repricing provision below); and |
| (k) | determine
the fair market value of the Common Stock or awards under this Plan from time to time
and/or the manner in which such value will be determined. |
| 3.3 | Prohibition
on Repricing. Notwithstanding anything to the contrary in Section 3.2 and except
for an adjustment pursuant to Section 7.1 or a repricing approved by stockholders, in
no case may the Administrator (1) amend an outstanding stock option or SAR to reduce
the exercise price or base price of the award, (2) cancel, exchange, or surrender an
outstanding stock option or SAR in exchange for cash or other awards for the purpose
of repricing the award, or (3) cancel, exchange, or surrender an outstanding stock option
or SAR in exchange for an option or SAR with an exercise or base price that is less than
the exercise or base price of the original award. |
| 3.4 | Binding
Determinations. Any determination or other action taken by, or inaction of, the
Corporation, any Subsidiary, or the Administrator relating or pursuant to this Plan (or
any award made under this Plan) and within its authority hereunder or under applicable
law shall be within the absolute discretion of that entity or body and shall be conclusive
and binding upon all persons. Neither the Board nor any Board committee, nor any member
thereof or person acting at the direction thereof, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in connection with this
Plan (or any award made under this Plan), and all such persons shall be entitled to indemnification
and reimbursement by the Corporation in respect of any claim, loss, damage or expense
(including, without limitation, attorneys’ fees) arising or resulting therefrom
to the fullest extent permitted by law and/or under any directors and officers liability
insurance coverage that may be in effect from time to time. Neither the Board nor any
other Administrator, nor any member thereof or person acting at the direction thereof,
nor the Corporation or any of its Subsidiaries, shall be liable for any damages of a
participant should an option intended as an ISO (as defined below) fail to meet the requirements
of the Internal Revenue Code of 1986, as amended (the “Code”), applicable
to ISOs, should any other award(s) fail to qualify for any intended tax treatment, should
any award grant or other action with respect thereto not satisfy Rule 16b-3 promulgated
under the Securities Exchange Act of 1934, as amended, or otherwise for any tax or other
liability imposed on a participant with respect to an award. |
| 3.5 | Reliance
on Experts. In making any determination or in taking or not taking any action
under this Plan, the Administrator may obtain and may rely upon the advice of experts,
including employees and professional advisors to the Corporation. No director, officer
or agent of the Corporation or any of its Subsidiaries shall be liable for any such action
or determination taken or made or omitted in good faith. |
| 3.6 | Delegation.
The Administrator may delegate ministerial, non-discretionary functions to individuals
who are officers or employees of the Corporation or any of its Subsidiaries or to third
parties. |
| 4. | SHARES OF COMMON STOCK
SUBJECT TO THE PLAN; SHARE LIMITS |
| 4.1 | Shares
Available. Subject to the provisions of Section 7.1, the capital stock that may
be delivered under this Plan shall be shares of the Corporation’s authorized but
unissued Common Stock and any shares of its Common Stock held as treasury shares. For
purposes of this Plan, “Common Stock” shall mean the common stock
of the Corporation and such other securities or property as may become the subject of
awards under this Plan, or may become subject to such awards, pursuant to an adjustment
made under Section 7.1. |
| 4.2 | Aggregate
Share Limit. The maximum number of shares of Common Stock that may be delivered
pursuant to awards granted to Eligible Persons under this Plan (the “Share Limit”)
is equal to the sum of the following: |
| (1) | 670,000
shares of Common Stock, plus |
| (2) | the
number of shares of Common Stock available for additional award grant purposes under
the Corporation’s 2007 Equity Incentive Plan (the “2007 Plan”)
as of the date of stockholder approval of this Plan (the “Stockholder Approval
Date”) and determined immediately prior to the termination of the authority
to grant new awards under the 2007 Plan as of the Stockholder Approval Date, plus |
| (3) | the
number of any shares subject to stock options granted under the 2007 Plan and outstanding
on the Stockholder Approval Date which expire, or for any reason are cancelled or terminated,
after the Stockholder Approval Date without being exercised (which, for purposes of clarity,
shall become available for award grants under this Plan on a one-for-one basis), plus; |
| (4) | the
number of any shares subject to restricted stock and restricted stock unit awards granted
under the 2007 Plan that are outstanding and unvested on the Stockholder Approval Date
that are forfeited, terminated, cancelled or otherwise reacquired by the Corporation
without having become vested, provided that in order to take the Full-Value Award ratio
below into account, each share subject to any such award shall be credited as 1.2 shares
when determining the number of shares that shall become available for new awards under
this Plan. |
provided
that in no event shall the Share Limit exceed 14,733,244 shares (which is the sum of (i) the 670,000 shares set forth above, plus
(ii) a maximum of 3,717,973 shares available under the 2007 Plan for additional award grant purposes as of the Effective Date
(as such term is defined in Section 8.6.1), plus (iii) a maximum of 6,926,634 shares subject to stock options previously granted
and outstanding under the 2007 Plan as of the Effective Date that could become available under the 2007 Plan as a result of the
expiration, cancellation or termination of such awards, plus (iv) 3,418,637 shares, which is a maximum of 2,848,864 shares subject
to restricted stock and restricted stock unit awards previously granted and outstanding and unvested under the 2007 Plan as of
the Effective Date that could become available under the 2007 Plan as a result of the forfeiture, termination or cancellation
of such awards multiplied by a factor of 1.2 (the share-counting ratio for such awards under clause (4) above).
Shares
issued in respect of any “Full-Value Award” granted under this Plan shall be counted against the foregoing Share Limit
as 1.2 shares for every one share issued in connection with such award. (For example, if a stock bonus of 100 shares of Common
Stock is granted under this Plan, 120 shares shall be counted against the Share Limit in connection with that award.) For this
purpose, a “Full-Value Award” means any award that is not a stock option grant or a stock appreciation
right grant.
| 4.3 | Additional
Share Limits. The following limits also apply with respect to awards granted
under this Plan. These limits are in addition to, not in lieu of, the aggregate Share
Limit in Section 4.2. |
| (a) | The
maximum number of shares of Common Stock that may be delivered pursuant to options qualified
as incentive stock options granted under this Plan is 5,000,000 shares. |
| (b) | The
maximum number of shares of Common Stock subject to those options and stock appreciation
rights that are granted under this Plan during any one calendar year to any one individual
is 4,000,000 shares. |
| (c) | The
maximum number of shares of Common Stock subject to all awards that are granted under
this Plan during any one calendar year to any one individual is 4,000,000 shares. |
| (d) | Awards
that are granted under this Plan during any one calendar year to any person who, on the
grant date of the award, is a non-employee director are subject to the limits of this
Section 4.3(d). The maximum number of shares of Common Stock subject to those awards
that are granted under this Plan during any one calendar year to an individual who, on
the grant date of the award, is a non-employee director is the number of shares that
produce a grant date fair value for the award that, when combined with the grant date
fair value of any other awards granted under this Plan during that same calendar year
to that individual in his or her capacity as a non-employee director, is $300,000; provided
that this limit is $400,000 as to (1) a non-employee director who is serving as the independent
Chair of the Board or as a lead independent director at the time the applicable grant
is made or (2) any new non-employee director for the calendar year in which the non-employee
director is first elected or appointed to the Board. For purposes of this Section 4.3(d),
a “non-employee director” is an individual who, on the grant date of the
award, is a member of the Board who is not then an officer or employee of the Corporation
or one of its Subsidiaries. For purposes of this Section 4.3(d), “grant date fair
value” means the value of the award as of the date of grant of the award and as
determined using the equity award valuation principles applied in the Corporation’s
financial reporting. The limits of this Section 4.3(d) do not apply to, and shall be
determined without taking into account, any award granted to an individual who, on the
grant date of the award, is an officer or employee of the Corporation or one of its Subsidiaries.
The limits of this Section 4.3(d) apply on an individual basis and not on an aggregate
basis to all non-employee directors as a group. |
| (e) | Additional
limits with respect to Qualified Performance-Based Awards are set forth in Section 5.2.3. |
| 4.4 | Share-Limit
Counting Rules. The Share Limit shall be subject to the following provisions
of this Section 4.4: |
| (a) | Shares
that are subject to or underlie awards granted under this Plan which expire or for any
reason are cancelled or terminated, are forfeited, fail to vest, or for any other reason
are not paid or delivered under this Plan shall not be counted against the Share Limit
and shall be available for subsequent awards under this Plan. |
| (b) | To
the extent that shares of Common Stock are delivered pursuant to the exercise of a stock
option or stock appreciation right granted under this Plan, the number of shares as to
which the portion of the stock option or stock appreciation right so exercised relates
shall be counted against the Share Limit as opposed to only counting the net number of
shares actually issued in connection with such exercise. (For purposes of clarity, if
a stock option or stock appreciation right relates to 100,000 shares and is exercised
as to all 100,000 shares at a time when the net number of shares due to the participant
in connection with such exercise is 15,000 shares (taking into account any shares withheld
to satisfy any applicable exercise or base price of the award and any shares withheld
to satisfy any tax withholding obligations in connection with such exercise), 100,000
shares shall be counted against the Share Limit with respect to such award.) |
| (c) | Shares
that are exchanged by a participant or withheld by the Corporation as full or partial
payment in connection with any stock option or stock appreciation right granted under
this Plan, as well as any shares exchanged by a participant or withheld by the Corporation
or one of its Subsidiaries to satisfy the tax withholding obligations related to any
stock option or stock appreciation right granted under this Plan, shall not be available
for subsequent awards under this Plan. |
| (d) | Shares
that are exchanged by a participant or withheld by the Corporation as full or partial
payment in connection with any Full-Value Award granted under this Plan or the 2007 Plan,
as well as any shares exchanged by a participant or withheld by the Corporation or one
of its Subsidiaries to satisfy the tax withholding obligations related to any Full-Value
Award granted under this Plan or the 2007 Plan, shall not be counted against the Share
Limit and shall be available for subsequent awards under this Plan, provided that any
one (1) share so exchanged or withheld in connection with any Full-Value Award shall
be credited as 1.2 shares when determining the number of shares that shall again become
available for subsequent awards under this Plan. |
| (e) | To
the extent that an award granted under this Plan is settled in cash or a form other than
shares of Common Stock, the shares that would have been delivered had there been no such
cash or other settlement shall not be counted against the Share Limit and shall be available
for subsequent awards under this Plan. |
| (f) | In
the event that shares of Common Stock are delivered in respect of a dividend equivalent
right granted under this Plan, the number of shares delivered with respect to the award
shall be counted against the Share Limit. (For purposes of clarity, if 1,000 dividend
equivalent rights are granted and outstanding when the Corporation pays a dividend, and
50 shares are delivered in payment of those rights with respect to that dividend, 60
shares (after giving effect to the Full-Value Award premium counting rules) shall be
counted against the Share Limit). Except as otherwise provided by the Administrator,
shares delivered in respect of dividend equivalent rights shall not count against any
individual award limit under this Plan other than the aggregate Share Limit. |
Refer
to Section 8.10 for application of the share limits of this Plan, including the limits in Sections 4.2 and 4.3, with respect to
assumed awards. Each of the numerical limits and references in Sections 4.2 and 4.3, and in this Section 4.4, is subject to adjustment
as contemplated by Section 4.3, Section 7 and Section 8.10. The share limits of Section 4.3 shall be applied on a one-for-one
basis without applying the Full-Value Award premium counting rule taken into account in determining the Share Limit. The foregoing
adjustments to the share limits of this Plan are subject to any applicable limitations under Section 162(m) of the Code with respect
to awards intended as performance-based compensation thereunder.
| 4.5 | No
Fractional Shares; Minimum Issue. Unless otherwise expressly provided
by the Administrator, no fractional shares shall be delivered under this Plan. The Administrator
may pay cash in lieu of any fractional shares in settlements of awards under this Plan.
The Administrator may from time to time impose a limit (of not greater than 100 shares)
on the minimum number of shares that may be purchased or exercised as to awards (or any
particular award) granted under this Plan unless (as to any particular award) the total
number purchased or exercised is the total number at the time available for purchase
or exercise under the award. |
| 5.1 | Type
and Form of Awards. The Administrator shall determine the type or types of award(s)
to be made to each selected Eligible Person. Awards may be granted singly, in combination
or in tandem. Awards also may be made in combination or in tandem with, in replacement
of, as alternatives to, or as the payment form for grants or rights under any other employee
or compensation plan of the Corporation or one of its Subsidiaries. The types of awards
that may be granted under this Plan are: |
5.1.1 Stock
Options. A stock option is the grant of a right to purchase a specified number of shares of Common Stock during a specified
period as determined by the Administrator. An option may be intended as an incentive stock option within the meaning of Section
422 of the Code (an “ISO”) or a nonqualified stock option (an option not intended to be an ISO). The agreement
evidencing the grant of an option will indicate if the option is intended as an ISO; otherwise it will be deemed to be a nonqualified
stock option. The maximum term of each option (ISO or nonqualified) shall be ten (10) years. The per share exercise price for
each option shall be not less than 100% of the fair market value of a share of Common Stock on the date of grant of the option.
When an option is exercised, the exercise price for the shares to be purchased shall be paid in full in cash or such other method
permitted by the Administrator consistent with Section 5.6.
5.1.2 Additional
Rules Applicable to ISOs. To the extent that the aggregate fair market value (determined at the time of grant of the applicable
option) of stock with respect to which ISOs first become exercisable by a participant in any calendar year exceeds $100,000, taking
into account both Common Stock subject to ISOs under this Plan and stock subject to ISOs under all other plans of the Corporation
or one of its Subsidiaries (or any parent or predecessor corporation to the extent required by and within the meaning of Section
422 of the Code and the regulations promulgated thereunder), such options shall be treated as nonqualified stock options. In reducing
the number of options treated as ISOs to meet the $100,000 limit, the most recently granted options shall be reduced first. To
the extent a reduction of simultaneously granted options is necessary to meet the $100,000 limit, the Administrator may, in the
manner and to the extent permitted by law, designate which shares of Common Stock are to be treated as shares acquired pursuant
to the exercise of an ISO. ISOs may only be granted to employees of the Corporation or one of its subsidiaries (for this purpose,
the term “subsidiary” is used as defined in Section 424(f) of the Code, which generally requires an unbroken chain
of ownership of at least 50% of the total combined voting power of all classes of stock of each subsidiary in the chain beginning
with the Corporation and ending with the subsidiary in question). No ISO may be granted to any person who, at the time the option
is granted, owns (or is deemed to own under Section 424(d) of the Code) shares of outstanding Common Stock possessing more than
10% of the total combined voting power of all classes of stock of the Corporation, unless the exercise price of such option is
at least 110% of the fair market value of the stock subject to the option and such option by its terms is not exercisable after
the expiration of five years from the date such option is granted. If an otherwise-intended ISO fails to meet the applicable requirements
of Section 422 of the Code, the option shall be a nonqualified stock option.
5.1.3 Stock
Appreciation Rights. A stock appreciation right or “SAR” is a right to receive a payment, in cash and/or
Common Stock, equal to the excess of the fair market value of a specified number of shares of Common Stock on the date the SAR
is exercised over the “base price” of the award, which base price shall be set forth in the applicable award
agreement and shall be not less than 100% of the fair market value of a share of Common Stock on the date of grant of the SAR.
The maximum term of a SAR shall be ten (10) years.
5.1.4 Other
Awards; Dividend Equivalent Rights. The other types of awards that may be granted under this Plan include: (a) stock bonuses,
restricted stock, performance stock, stock units, phantom stock or similar rights to purchase or acquire shares, whether at a
fixed or variable price (or no price) or fixed or variable ratio related to the Common Stock, and any of which may (but need not)
be fully vested at grant or vest upon the passage of time, the occurrence of one or more events, the satisfaction of performance
criteria or other conditions, or any combination thereof; or (b) cash awards. Dividend equivalent rights may be granted as
a separate award or in connection with another award under this Plan; provided, however, that dividend equivalent rights may not
be granted as to a stock option or SAR granted under this Plan. In addition, any dividends and/or dividend equivalents as to the
portion of an award that is subject to unsatisfied vesting requirements will be subject to termination and forfeiture to the same
extent as the corresponding portion of the award to which they relate in the event the applicable vesting requirements are not
satisfied.
| 5.2 | Section
162(m) Performance-Based Awards. Without limiting the generality of the foregoing,
any of the types of awards listed in Section 5.1.4 above may be, and options and SARs
granted to officers and employees also may be, granted as awards intended to satisfy
the requirements for “performance-based compensation” within the meaning
of Section 162(m) of the Code. An Award (other than an option or SAR) intended by the
Administrator to satisfy the requirements for “performance-based compensation”
within the meaning of Section 162(m) of the Code is referred to as a “Qualified
Performance-Based Award.” An option or SAR intended to satisfy the requirements
for “performance-based compensation” within the meaning of Section 162(m)
of the Code is referred to as a “Qualifying Option or SAR.” The grant,
vesting, exercisability or payment of Qualified Performance-Based Awards may depend on
the degree of achievement of one or more performance goals relative to a pre-established
targeted level or levels using one or more of the Business Criteria set forth below (on
an absolute or relative (including, without limitation, relative to the performance of
one or more other companies or upon comparisons of any of the indicators of performance
relative to one or more other companies) basis, any of which may also be expressed as
a growth or decline measure relative to an amount or performance for a prior date or
period) for the Corporation on a consolidated basis or for one or more of the Corporation’s
subsidiaries, segments, divisions or business units, or any combination of the foregoing.
Any Qualified Performance-Based Award shall be subject to the following provisions of
this Section 5.2, and a Qualifying Option or SAR shall be subject to the following provisions
of this Section 5.2 only to the extent expressly set forth below. Nothing in this Plan,
however, requires the Administrator to qualify any award or compensation as “performance-based
compensation” under Section 162(m) of the Code. |
5.2.1 Class;
Administrator. The eligible class of persons for Qualified Performance-Based Awards under this Section 5.2, as well
as for a Qualifying Option or SAR, shall be officers and employees of the Corporation or one of its Subsidiaries. To qualify awards
as performance-based under Section 162(m), the Administrator approving Qualified Performance-Based Awards or a Qualifying Option
or SAR, or making any certification required pursuant to Section 5.2.4, must constitute a committee consisting solely of two or
more outside directors (as this requirement is applied under Section 162(m) of the Code).
5.2.2 Performance
Goals.
| (a) | The
specific performance goals for Qualified Performance-Based Awards shall be established
based on one or more of the following business criteria (“Business Criteria”)
as selected by the Administrator in its sole discretion: earnings per share, return on
capital employed, costs, net income (before or after interest, taxes, depreciation and/or
amortization), operating margin, revenues, revenue from operations, expenses, income
from operations as a percent of capital employed, income from operations (before or after
taxes), cash flow, market share, market penetration or other performance measures with
respect to specific designated products or product groups and/or specific geographic
areas, return on equity, average equity used, value of assets, return or net return on
assets, net assets, sales or capital (including invested capital), working capital, growth
in assets or net assets, asset intensity, earnings (including net earnings, earnings
before interest, taxes, depreciation and amortization, and earnings before interest and
taxes), cash flow (including operating and net cash flow), adjusted cash flow from operations,
operating cash flow as a percent of capital employed, economic value added, gross or
net profit or operating margin, stock price, total shareholder return, reduction of losses,
reduction of expenses, loss ratios or expense ratios, costs (including cost of capital,
cost per loan, cost per hire and training costs), debt reduction, workforce diversity,
number of accounts, workers’ compensation claims, budgeted amounts, turnover rate,
mortgage loan delinquencies, pre-foreclosure delinquency resolutions, dispositions of
REO properties, servicing advances, loans (including forward and reverse mortgage loans),
call center metrics, complaint resolution rates, customer satisfaction based on specified
objective goals, reduced excess facilities and/or reduced facility costs, delivery of
objectively determinable key projects on time and per specified objectives, objective
process and vendor management measures, including turn-times, error rates and objective
quality control measures, and objective management development measures, including delivery,
participation rates and success in programs aimed at building organizational capabilities
and talent, or any combination thereof. For such purposes, earnings-based measures may
(without limitation) be based on comparisons to capital, stockholders’ equity,
shares outstanding or such other measures selected or defined by the Administrator at
the time of making an award. The applicable performance measurement period may not be
less than three months nor more than 10 years. |
| (b) | The
terms of the Qualified Performance-Based Awards may specify the manner, if any, in which
performance targets (or the applicable measure of performance) shall be adjusted: to
mitigate the unbudgeted impact of material, unusual or nonrecurring gains and losses;
to exclude restructuring and/or other nonrecurring charges; to exclude the effects of
financing activities; to exclude exchange rate effects; to exclude the effects of changes
to accounting principles; to exclude the effects of any statutory adjustments to corporate
tax rates; to exclude the effects of any items of an unusual nature or of infrequency
of occurrence; to exclude the effects of acquisitions or joint ventures; to exclude the
effects of discontinued operations; to assume that any business divested achieved performance
objectives at targeted levels during the balance of a performance period following such
divestiture or to exclude the effects of any divestiture; to exclude the effect of any
event or transaction referenced in Section 7.1; to exclude the effects of stock-based
compensation; to exclude the award of bonuses; to exclude amortization of acquired intangible
assets; to exclude the goodwill and intangible asset impairment charges; to exclude the
effect of any other unusual, non-recurring gain or loss, non-operating item or other
extraordinary item; to exclude the costs associated with any of the foregoing or any
potential transaction that if consummated would constitute any of the foregoing; or to
exclude other items specified by the Administrator at the time of establishing the targets. |
| (c) | To
qualify awards as performance-based under Section 162(m), the applicable Business Criterion
(or Business Criteria, as the case may be) and specific performance formula, goal or
goals (“targets”) must be established and approved by the Administrator during
the first 90 days of the performance period (and, in the case of performance periods
of less than one year, in no event after 25% or more of the performance period has elapsed)
and while performance relating to such target(s) remains substantially uncertain within
the meaning of Section 162(m) of the Code. |
5.2.3 Form
of Payment; Maximum Qualified Performance-Based Award. Grants or awards under this Section 5.2 may be paid in cash or
shares of Common Stock or any combination thereof. Qualifying Option or SAR awards granted to any one participant in any one calendar
year shall be subject to the limit set forth in Section 4.3(b). A Qualified Performance-Based Award shall be subject to the following
applicable limit: (a) in the case of a Qualified Performance-Based Award where the value of the Award is expressed as a number
or range of number of shares of Common Stock (such as, without limitation, a Qualified Performance-Based Award in the form of
a restricted stock, performance stock, or stock unit award) or a Qualified Performance-Based Award where the amount of cash payable
upon or following vesting of the award is determined with reference to the fair market value of a share of Common Stock at such
time, the maximum number of shares of Common Stock which may be subject to such Qualified Performance-Based Awards described in
this clause (a) that are granted to any one participant in any one calendar year shall not exceed 4,000,000 shares (counting
such shares on a one-for-one basis for this purpose), either individually or in the aggregate, subject to adjustment as provided
in Section 7.1; and (b) in the case of other Qualified Performance-Based Awards (such as a Qualified Performance-Based Award where
the potential payment is a stated cash amount or range of stated cash amounts, whether the payment is ultimately made in cash
or Common Stock by converting the applicable cash amount into a number of shares of Common Stock based on the fair market value
of a share of Common Stock upon or following vesting of the award), the aggregate amount of compensation to be paid to any one
participant in respect of all such Qualified Performance-Based Awards granted to that participant in any one calendar year shall
not exceed $6,000,000. The limits in clauses (a) and (b) in the preceding sentence are separate, independent limits, and a Qualified
Performance-Based Award shall be subject to the applicable limit but not both limits. For clarity, an eligible individual may
receive, during any applicable year, awards referenced in clause (a) of this Section 5.2.3 not in excess of the limit of that
clause, awards referenced in clause (b) of this Section 5.2.3 not in excess of the limit of that clause, Qualifying Option or
SAR awards not in excess of the limit set forth in Section 4.3(b), as well as other types of awards (not referenced in this Section
5.2.3) under this Plan. Awards that are canceled during the year shall be counted against any applicable limits of Section 4.3(b)
and this Section 5.2.3 to the extent required by Section 162(m) of the Code.
5.2.4 Certification
of Payment. Before any Qualified Performance-Based Award is paid and to the extent applicable to qualify the award as
performance-based compensation within the meaning of Section 162(m) of the Code, the Administrator must certify in writing that
the performance target(s) and any other material terms of the Qualified Performance-Based Award were in fact timely satisfied.
5.2.5 Reservation
of Discretion. The Administrator will have the discretion to determine the restrictions or other limitations of the individual
awards granted under this Section 5.2 including the authority to reduce awards, payouts or vesting or to pay no awards, in its
sole discretion, if the Administrator preserves such authority at the time of grant by language to this effect in its authorizing
resolutions or otherwise.
5.2.6 Expiration
of Grant Authority. As required pursuant to Section 162(m) of the Code and the regulations promulgated thereunder, the
Administrator’s authority to grant new awards that are intended to qualify as performance-based compensation within the
meaning of Section 162(m) of the Code (other than a Qualifying Option or SAR) shall terminate upon the first meeting of the Corporation’s
stockholders that occurs in the fifth year following the year in which the Corporation’s stockholders first approve this
Plan, subject to any subsequent extension that may be approved by stockholders.
| 5.3 | Minimum
Vesting Requirement. Except as provided in the next sentence, each award granted
under this Plan shall be subject to a minimum vesting requirement of one year and no
portion of any such award may provide that it will vest earlier than the first anniversary
of the date of grant of the award other than due to the death, disability, or involuntary
termination of the employment or services of the award holder, or in connection with
a Change in Control (as such term is defined in Section 7.3) (the “Minimum Vesting
Requirement”). Awards may be granted under this Plan with minimum vesting requirements
of less than one year, or no vesting requirements, provided that the total number of
shares of Common Stock subject to such awards shall not exceed 5% of the Share Limit. |
| 5.4 | Award
Agreements. Each award shall be evidenced by a written or electronic award agreement
or notice in a form approved by the Administrator (an “award agreement”),
and, in each case and if required by the Administrator, executed or otherwise electronically
accepted by the recipient of the award in such form and manner as the Administrator may
require. |
| 5.5 | Deferrals
and Settlements. Payment of awards may be in the form of cash, Common Stock,
other awards or combinations thereof as the Administrator shall determine, and with such
restrictions (if any) as it may impose. The Administrator may also require or permit
participants to elect to defer the issuance of shares or the settlement of awards in
cash under such rules and procedures as it may establish under this Plan. The Administrator
may also provide that deferred settlements include the payment or crediting of interest
or other earnings on the deferral amounts, or the payment or crediting of dividend equivalents
where the deferred amounts are denominated in shares. |
| 5.6 | Consideration
for Common Stock or Awards. The purchase price
(if any) for any award granted under this Plan or the Common Stock to be delivered pursuant
to an award, as applicable, may be paid by means of any lawful consideration as determined
by the Administrator, including, without limitation, one or a combination of the following
methods: |
| (a) | services
rendered by the recipient of such award; |
| (b) | cash,
check payable to the order of the Corporation, or electronic funds transfer; |
| (c) | notice
and third party payment in such manner as may be authorized by the Administrator; |
| (d) | the
delivery of previously owned shares of Common Stock; |
| (e) | by
a reduction in the number of shares otherwise deliverable pursuant to the award; or |
| (f) | subject
to such procedures as the Administrator may adopt, pursuant to a “cashless exercise”
with a third party who provides financing for the purposes of (or who otherwise facilitates)
the purchase or exercise of awards. |
In
no event shall any shares newly-issued by the Corporation be issued for less than the minimum lawful consideration for such shares
or for consideration other than consideration permitted by applicable state law. Shares of Common Stock used to satisfy the exercise
price of an option shall be valued at their fair market value. The Corporation will not be obligated to deliver any shares unless
and until it receives full payment of the exercise or purchase price therefor and any related withholding obligations under Section
8.5 and any other conditions to exercise or purchase have been satisfied. Unless otherwise expressly provided in the applicable
award agreement, the Administrator may at any time eliminate or limit a participant’s ability to pay any purchase or exercise
price of any award or shares by any method other than cash payment to the Corporation.
| 5.7 | Definition
of Fair Market Value. For purposes of this Plan, “fair market value”
shall mean, unless otherwise determined or provided by the Administrator in the circumstances,
the closing price (in regular trading) for a share of Common Stock on the New York Stock
Exchange (the “Exchange”) for the date in question or, if no sales
of Common Stock were reported on the Exchange on that date, the closing price (in regular
trading) for a share of Common Stock on the Exchange for the next preceding day on which
sales of Common Stock were reported on the Exchange. The Administrator may, however,
provide with respect to one or more awards that the fair market value shall equal the
closing price (in regular trading) for a share of Common Stock on the Exchange on the
last trading day preceding the date in question or the average of the high and low trading
prices of a share of Common Stock on the Exchange for the date in question or the most
recent trading day. If the Common Stock is no longer listed or is no longer actively
traded on the Exchange as of the applicable date, the fair market value of the Common
Stock shall be the value as reasonably determined by the Administrator for purposes of
the award in the circumstances. The Administrator also may adopt a different methodology
for determining fair market value with respect to one or more awards if a different methodology
is necessary or advisable to secure any intended favorable tax, legal or other treatment
for the particular award(s) (for example, and without limitation, the Administrator may
provide that fair market value for purposes of one or more awards will be based on an
average of closing prices (or the average of high and low daily trading prices) for a
specified period preceding the relevant date). |
| 5.8 | Transfer Restrictions. |
5.8.1 Limitations
on Exercise and Transfer. Unless otherwise expressly provided in (or pursuant to) this Section 5.8 or required by applicable
law: (a) all awards are non-transferable and shall not be subject in any manner to sale, transfer, anticipation, alienation, assignment,
pledge, encumbrance or charge; (b) awards shall be exercised only by the participant; and (c) amounts payable or shares issuable
pursuant to any award shall be delivered only to (or for the account of) the participant.
5.8.2 Exceptions.
The Administrator may permit awards to be exercised by and paid to, or otherwise transferred to, other persons or entities pursuant
to such conditions and procedures, including limitations on subsequent transfers, as the Administrator may, in its sole discretion,
establish in writing. Any permitted transfer shall be subject to compliance with applicable federal and state securities laws
and shall not be for value (other than nominal consideration, settlement of marital property rights, or for interests in an entity
in which more than 50% of the voting interests are held by the Eligible Person or by the Eligible Person’s family members).
5.8.3 Further
Exceptions to Limits on Transfer. The exercise and transfer restrictions in Section 5.8.1 shall not apply to:
| (a) | transfers
to the Corporation (for example, in connection with the expiration or termination of
the award), |
| (b) | the designation of a beneficiary
to receive benefits in the event of the participant’s death or, if the participant has died, transfers to or exercise by
the participant’s beneficiary, or, in the absence of a validly designated beneficiary, transfers by will or the laws of
descent and distribution, |
| (c) | subject
to any applicable limitations on ISOs, transfers to a family member (or former family
member) pursuant to a domestic relations order if received by the Administrator, |
| (d) | if
the participant has suffered a disability, permitted transfers or exercises on behalf
of the participant by his or her legal representative, or |
| (e) | the
authorization by the Administrator of “cashless exercise” procedures with
third parties who provide financing for the purpose of (or who otherwise facilitate)
the exercise of awards consistent with applicable laws and any limitations imposed by
the Administrator. |
| 5.9 | International
Awards. One or more awards may be granted to Eligible Persons who provide services
to the Corporation or one of its Subsidiaries outside of the United States. Any awards
granted to such persons may be granted pursuant to the terms and conditions of any applicable
sub-plans, if any, appended to this Plan and approved by the Administrator from time
to time. The awards so granted need not comply with other specific terms of this Plan,
provided that stockholder approval of any deviation from the specific terms of this Plan
is not required by applicable law or any applicable listing agency. |
| 6. | EFFECT OF TERMINATION
OF EMPLOYMENT OR SERVICE ON AWARDS |
| 6.1 | General.
The Administrator shall establish the effect (if any) of a termination of employment
or service on the rights and benefits under each award under this Plan and in so doing
may make distinctions based upon, inter alia, the cause of termination and type of award.
If the participant is not an employee of the Corporation or one of its Subsidiaries,
is not a member of the Board, and provides other services to the Corporation or one of
its Subsidiaries, the Administrator shall be the sole judge for purposes of this Plan
(unless a contract or the award otherwise provides) of whether the participant continues
to render services to the Corporation or one of its Subsidiaries and the date, if any,
upon which such services shall be deemed to have terminated. |
| 6.2 | Events
Not Deemed Terminations of Employment. Unless the express policy of the Corporation
or one of its Subsidiaries, or the Administrator, otherwise provides, or except as otherwise
required by applicable law, the employment relationship shall not be considered terminated
in the case of (a) sick leave, (b) military leave, or (c) any other leave of absence
authorized by the Corporation or one of its Subsidiaries, or the Administrator; provided
that, unless reemployment upon the expiration of such leave is guaranteed by contract
or law or the Administrator otherwise provides, such leave is for a period of not more
than three months. In the case of any employee of the Corporation or one of its Subsidiaries
on an approved leave of absence, continued vesting of the award while on leave from the
employ of the Corporation or one of its Subsidiaries may be suspended until the employee
returns to service, unless the Administrator otherwise provides or applicable law otherwise
requires. In no event shall an award be exercised after the expiration of any applicable
maximum term of the award. |
| 6.3 | Effect
of Change of Subsidiary Status. For purposes of this Plan and any award, if an
entity ceases to be a Subsidiary of the Corporation a termination of employment or service
shall be deemed to have occurred with respect to each Eligible Person in respect of such
Subsidiary who does not continue as an Eligible Person in respect of the Corporation
or another Subsidiary that continues as such after giving effect to the transaction or
other event giving rise to the change in status unless the Subsidiary that is sold, spun-off
or otherwise divested (or its successor or a direct or indirect parent of such Subsidiary
or successor) assumes the Eligible Person’s award(s) in connection with such transaction. |
| 7. | ADJUSTMENTS; ACCELERATION |
| (a) | Subject
to Section 7.2, upon (or, as may be necessary to effect the adjustment, immediately prior
to): any reclassification, recapitalization, stock split (including a stock split in
the form of a stock dividend) or reverse stock split; any merger, combination, consolidation,
conversion or other reorganization; any spin-off, split-up, or similar extraordinary
dividend distribution in respect of the Common Stock; or any exchange of Common Stock
or other securities of the Corporation, or any similar, unusual or extraordinary corporate
transaction in respect of the Common Stock; then the Administrator shall equitably and
proportionately adjust (1) the number and type of shares of Common Stock (or other securities)
that thereafter may be made the subject of awards (including the specific share limits,
maximums and numbers of shares set forth elsewhere in this Plan), (2) the number, amount
and type of shares of Common Stock (or other securities or property) subject to any outstanding
awards, (3) the grant, purchase, or exercise price (which term includes the base price
of any SAR or similar right) of any outstanding awards, and/or (4) the securities, cash
or other property deliverable upon exercise or payment of any outstanding awards, in
each case to the extent necessary to preserve (but not increase) the level of incentives
intended by this Plan and the then-outstanding awards. |
| (b) | Unless
otherwise expressly provided in the applicable award agreement, upon (or, as may be necessary
to effect the adjustment, immediately prior to) any event or transaction described in
the preceding paragraph or a sale of all or substantially all of the business or assets
of the Corporation as an entirety, the Administrator shall equitably and proportionately
adjust the performance standards and/or period applicable to any then-outstanding performance-based
awards to the extent necessary to preserve (but not increase) the level of incentives
intended by this Plan and the then-outstanding performance-based awards. |
| (c) | It
is intended that, if possible, any adjustments contemplated by the preceding two paragraphs
be made in a manner that satisfies applicable U.S. legal, tax (including, without limitation
and as applicable in the circumstances, Section 424 of the Code as to ISOs, Section 409A
of the Code as to awards intended to comply therewith and not be subject to taxation
thereunder, and Section 162(m) of the Code as to any Qualifying Option or SAR and any
Qualified Performance-Based Award) and accounting (so as to not trigger any unintended
charge to earnings with respect to such adjustment) requirements. |
| (d) | Without
limiting the generality of Section 3.4, any good faith determination by the Administrator
as to whether an adjustment is required in the circumstances pursuant to this Section
7.1, and the extent and nature of any such adjustment, shall be conclusive and binding
on all persons. |
| 7.2 | Corporate Transactions
- Assumption and Termination of Awards. |
| (a) | Upon
any event in which the Corporation does not survive, or does not survive as a public
company in respect of its Common Stock (including, without limitation, a dissolution,
merger, combination, consolidation, conversion, exchange of securities, or other reorganization,
or a sale of all or substantially all of the business, stock or assets of the Corporation,
in any case in connection with which the Corporation does not survive or does not survive
as a public company in respect of its Common Stock), then the Administrator may make
provision for a cash payment in settlement of, or for the termination, assumption, substitution
or exchange of any or all outstanding awards or the cash, securities or property deliverable
to the holder of any or all outstanding awards, based upon, to the extent relevant under
the circumstances, the distribution or consideration payable to holders of the Common
Stock upon or in respect of such event. Upon the occurrence of any event described in
the preceding sentence in connection with which the Administrator has made provision
for the award to be terminated (and the Administrator has not made a provision for the
substitution, assumption, exchange or other continuation or settlement of the award):
(1) unless otherwise provided in the applicable award agreement, each then-outstanding
option and SAR shall become fully vested, all shares of restricted stock then outstanding
shall fully vest free of restrictions, and each other award granted under this Plan that
is then outstanding shall become payable to the holder of such award (with any performance
goals applicable to the award in each case being deemed met, unless otherwise provided
in the award agreement, at the “target” performance level); and (2) each
award shall terminate upon the related event; provided that the holder of an option or
SAR shall be given reasonable advance notice of the impending termination and a reasonable
opportunity to exercise his or her outstanding vested options and SARs (after giving
effect to any accelerated vesting required in the circumstances) in accordance with their
terms before the termination of such awards (except that in no case shall more than ten
days’ notice of the impending termination be required and any acceleration of vesting
and any exercise of any portion of an award that is so accelerated may be made contingent
upon the actual occurrence of the event). |
| (b) | Without
limiting the preceding paragraph, in connection with any event referred to in the preceding
paragraph or any change in control event defined in any applicable award agreement, the
Administrator may, in its discretion, provide for the accelerated vesting of any award
or awards as and to the extent determined by the Administrator in the circumstances. |
| (c) | For
purposes of this Section 7.2, an award shall be deemed to have been “assumed”
if (without limiting other circumstances in which an award is assumed) the award continues
after an event referred to above in this Section 7.2, and/or is assumed and continued
by the surviving entity following such event (including, without limitation, an entity
that, as a result of such event, owns the Corporation or all or substantially all of
the Corporation’s assets directly or through one or more subsidiaries (a “Parent”)),
and confers the right to purchase or receive, as applicable and subject to vesting and
the other terms and conditions of the award, for each share of Common Stock subject to
the award immediately prior to the event, the consideration (whether cash, shares, or
other securities or property) received in the event by the stockholders of the Corporation
for each share of Common Stock sold or exchanged in such event (or the consideration
received by a majority of the stockholders participating in such event if the stockholders
were offered a choice of consideration); provided, however, that if the consideration
offered for a share of Common Stock in the event is not solely the ordinary common stock
of a successor corporation or a Parent, the Administrator may provide for the consideration
to be received upon exercise or payment of the award, for each share subject to the award,
to be solely ordinary common stock of the successor corporation or a Parent equal in
fair market value to the per share consideration received by the stockholders participating
in the event. |
| (d) | The
Administrator may adopt such valuation methodologies for outstanding awards as it deems
reasonable in the event of a cash or property settlement and, in the case of options,
SARs or similar rights, but without limitation on other methodologies, may base such
settlement solely upon the excess if any of the per share amount payable upon or in respect
of such event over the exercise or base price of the award. In the case of an option,
SAR or similar right as to which the per share amount payable upon or in respect of such
event is less than or equal to the exercise or base price of the award, the Administrator
may terminate such award in connection with an event referred to in this Section 7.2
without any payment in respect of such award. |
| (e) | In
any of the events referred to in this Section 7.2, the Administrator may take such action
contemplated by this Section 7.2 prior to such event (as opposed to on the occurrence
of such event) to the extent that the Administrator deems the action necessary to permit
the participant to realize the benefits intended to be conveyed with respect to the underlying
shares. Without limiting the generality of the foregoing, the Administrator may deem
an acceleration and/or termination to occur immediately prior to the applicable event
and, in such circumstances, will reinstate the original terms of the award if an event
giving rise to an acceleration and/or termination does not occur. |
| (f) | Without
limiting the generality of Section 3.4, any good faith determination by the Administrator
pursuant to its authority under this Section 7.2 shall be conclusive and binding on all
persons. |
| (g) | The
Administrator may override the provisions of this Section 7.2 by express provision in
the award agreement and may accord any Eligible Person a right to refuse any acceleration,
whether pursuant to the award agreement or otherwise, in such circumstances as the Administrator
may approve. The portion of any ISO accelerated in connection with an event referred
to in this Section 7.2 (or such other circumstances as may trigger accelerated vesting
of the award) shall remain exercisable as an ISO only to the extent the applicable $100,000
limitation on ISOs is not exceeded. To the extent exceeded, the accelerated portion of
the option shall be exercisable as a nonqualified stock option under the Code. |
| 7.3 | Definition of Change
in Control. As used in this Plan, “Change in Control” shall mean the occurrence, after the Effective
Date, of any of the following: |
| (a) | The
acquisition by any individual, entity or group (within the meaning of Section 13(d)(3)
or 14(d)(2) of the Securities Exchange Act of 1934, as amended (a “Person”))
of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended) of more than 30% of either (1) the then-outstanding
shares of common stock of the Corporation (the “Outstanding Company Common Stock”)
or (2) the combined voting power of the then-outstanding voting securities of the Corporation
entitled to vote generally in the election of directors (the “Outstanding Company
Voting Securities”); provided, however, that, for purposes of this clause (a),
the following acquisitions shall not constitute a Change in Control: (A) any acquisition
directly from the Corporation, (B) any acquisition by the Corporation, (C) any acquisition
by any employee benefit plan (or related trust) sponsored or maintained by the Corporation
or any affiliate of the Corporation or a successor, or (D) any acquisition by any entity
pursuant to a transaction that complies with clauses (c)(1), (c)(2) and (c)(3) below; |
| (b) | Individuals
who, as of the Effective Date, constitute the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the Board; provided, however,
that any individual becoming a director subsequent to the Effective Date whose election,
or nomination for election by the Corporation’s stockholders, was approved by a
vote of at least two-thirds of the directors then comprising the Incumbent Board (including
for these purposes, the new members whose election or nomination was so approved, without
counting the member and his predecessor twice) shall be considered as though such individual
were a member of the Incumbent Board, but excluding, for this purpose, any such individual
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; |
| (c) | Consummation
of a reorganization, merger, statutory share exchange or consolidation or similar corporate
transaction involving the Corporation or any of its Subsidiaries, a sale or other disposition
of all or substantially all of the assets of the Corporation, or the acquisition of assets
or stock of another entity by the Corporation or any of its Subsidiaries (each, a “Business
Combination”), in each case unless, following such Business Combination, (1)
all or substantially all of the individuals and entities that were the beneficial owners
of the Outstanding Company Common Stock and the Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially own, directly or indirectly,
more than 50% of the then-outstanding shares of common stock and 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 that, as a result of such transaction, owns
the Corporation or all or substantially all of the Corporation's assets directly or through
one or more subsidiaries (a “Parent”)) in substantially the same proportions
as their ownership immediately prior to such Business Combination of the Outstanding
Company Common Stock and the Outstanding Company Voting Securities, as the case may be,
(2) no Person (excluding any entity resulting from such Business Combination or a Parent
or any employee benefit plan (or related trust) of the Corporation or such entity resulting
from such Business Combination or Parent) beneficially owns, directly or indirectly,
more than 30% of, respectively, the then-outstanding shares of common stock of the entity
resulting from such Business Combination or the combined voting power of the then-outstanding
voting securities of such entity, except to the extent that the ownership in excess of
30% existed prior to the Business Combination, and (3) at least a majority of the members
of the board of directors or trustees of the entity resulting from such Business Combination
or a Parent were members of the Incumbent Board at the time of the execution of the initial
agreement or of the action of the Board providing for such Business Combination; or |
| (d) | Approval
by the stockholders of the Corporation of a complete liquidation or dissolution of the
Corporation other than in the context of a transaction that does not constitute a Change
in Control under clause (c) above. |
| 8.1 | Compliance
with Laws. This Plan, the granting and vesting of awards under this Plan, the
offer, issuance and delivery of shares of Common Stock, and/or the payment of money under
this Plan or under awards are subject to compliance with all applicable federal, state,
local and foreign 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
Corporation, be necessary or advisable in connection therewith. The person acquiring
any securities under this Plan will, if requested by the Corporation or one of its Subsidiaries,
provide such assurances and representations to the Corporation or one of its Subsidiaries
as the Administrator may deem necessary or desirable to assure compliance with all applicable
legal and accounting requirements. |
| 8.2 | No
Rights to Award. No person shall have any claim or rights to be granted an award
(or additional awards, as the case may be) under this Plan, subject to any express contractual
rights (set forth in a document other than this Plan) to the contrary. |
| 8.3 | No
Employment/Service Contract. Nothing contained in this Plan (or in any other
documents under this Plan or in any award) shall confer upon any Eligible Person or other
participant any right to continue in the employ or other service of the Corporation or
one of its Subsidiaries, constitute any contract or agreement of employment or other
service or affect an employee’s status as an employee at will, nor shall interfere
in any way with the right of the Corporation or one of its Subsidiaries to change a person’s
compensation or other benefits, or to terminate his or her employment or other service,
with or without cause. Nothing in this Section 8.3, however, is intended to adversely
affect any express independent right of such person under a separate employment or service
contract other than an award agreement. |
| 8.4 | Plan
Not Funded. Awards payable under this Plan shall be payable in shares or from
the general assets of the Corporation, and no special or separate reserve, fund or deposit
shall be made to assure payment of such awards. No participant, beneficiary or other
person shall have any right, title or interest in any fund or in any specific asset (including
shares of Common Stock, except as expressly otherwise provided) of the Corporation or
one of its Subsidiaries by reason of any award hereunder. Neither the provisions of this
Plan (or of any related documents), nor the creation or adoption of this Plan, nor any
action taken pursuant to the provisions of this Plan shall create, or be construed to
create, a trust of any kind or a fiduciary relationship between the Corporation or one
of its Subsidiaries and any participant, beneficiary or other person. To the extent that
a participant, beneficiary or other person acquires a right to receive payment pursuant
to any award hereunder, such right shall be no greater than the right of any unsecured
general creditor of the Corporation. |
| 8.5 | Tax
Withholding. Upon any exercise, vesting, or payment of any award, or upon the
disposition of shares of Common Stock acquired pursuant to the exercise of an ISO prior
to satisfaction of the holding period requirements of Section 422 of the Code, or upon
any other tax withholding event with respect to any award, arrangements satisfactory
to the Corporation shall be made to provide for any taxes the Corporation or any of its
Subsidiaries may be required to withhold with respect to such award event or payment.
Such arrangements may include (but are not limited to) any one of (or a combination of)
the following: |
| (a) | The
Corporation or one of its Subsidiaries shall have the right to require the participant
(or the participant’s personal representative or beneficiary, as the case may be)
to pay or provide for payment of the amount of any taxes which the Corporation or one
of its Subsidiaries may be required to withhold with respect to such award event or payment. |
| (b) | The
Corporation or one of its Subsidiaries shall have the right to deduct from any amount
otherwise payable in cash (whether related to the award or otherwise) to the participant
(or the participant’s personal representative or beneficiary, as the case may be)
the amount of any taxes which the Corporation or one of its Subsidiaries may be required
to withhold with respect to such award event or payment. |
| (c) | In
any case where a tax is required to be withheld in connection with the delivery of shares
of Common Stock under this Plan, the Administrator may in its sole discretion (subject
to Section 8.1) require or grant (either at the time of the award or thereafter) to the
participant the right to elect, pursuant to such rules and subject to such conditions
as the Administrator may establish, that the Corporation reduce the number of shares
to be delivered by (or otherwise reacquire) the appropriate number of shares, valued
in a consistent manner at their fair market value or at the sales price in accordance
with authorized procedures for cashless exercises, necessary to satisfy the applicable
withholding obligation on exercise, vesting or payment. Unless otherwise provided by
the Administrator, in no event shall the shares withheld exceed the minimum whole number
of shares required for tax withholding under applicable law to the extent the Corporation
determines that withholding at any greater level would result in an award otherwise classified
as an equity award under ASC Topic 718 (or any successor thereto) being classified as
a liability award under ASC Topic 718 (or such successor). |
| 8.6 | Effective Date, Termination
and Suspension, Amendments. |
8.6.1 Effective
Date. This Plan is effective as of April 6, 2017, the date of its approval by the Board (the “Effective Date”).
This Plan shall be submitted for and subject to stockholder approval no later than twelve months after the Effective Date. Unless
earlier terminated by the Board and subject to any extension that may be approved by stockholders, this Plan shall terminate at
the close of business on the day before the tenth anniversary of the Effective Date. After the termination of this Plan either
upon such stated termination date or its earlier termination by the Board, no additional awards may be granted under this Plan,
but previously granted awards (and the authority of the Administrator with respect thereto, including the authority to amend such
awards) shall remain outstanding in accordance with their applicable terms and conditions and the terms and conditions of this
Plan.
8.6.2 Board
Authorization. The Board may, at any time, terminate or, from time to time, amend, modify or suspend this Plan, in whole
or in part. No awards may be granted during any period that the Board suspends this Plan.
8.6.3 Stockholder
Approval. To the extent then required by applicable law or deemed necessary or advisable by the Board, any amendment to
this Plan shall be subject to stockholder approval.
8.6.4 Amendments
to Awards. Without limiting any other express authority of the Administrator under (but subject to) the express limits
of this Plan, the Administrator by agreement or resolution may waive conditions of or limitations on awards to participants that
the Administrator in the prior exercise of its discretion has imposed, without the consent of a participant, and (subject to the
requirements of Sections 3.2 and 8.6.5) may make other changes to the terms and conditions of awards. Any amendment or other action
that would constitute a repricing of an award is subject to the no-repricing provision of Section 3.3. The Minimum Vesting Requirement
shall not limit or restrict the Administrator’s discretion to accelerate the vesting of any award in any circumstances it
determines to be appropriate.
8.6.5 Limitations
on Amendments to Plan and Awards. No amendment, suspension or termination of this Plan or amendment of any outstanding
award agreement shall, without written consent of the participant, affect in any manner materially adverse to the participant
any rights or benefits of the participant or obligations of the Corporation under any award granted under this Plan prior to the
effective date of such change. Changes, settlements and other actions contemplated by Section 7 shall not be deemed to constitute
changes or amendments for purposes of this Section 8.6.
| 8.7 | Privileges
of Stock Ownership. Except as otherwise expressly authorized by the Administrator,
a participant shall not be entitled to any privilege of stock ownership as to any shares
of Common Stock not actually delivered to and held of record by the participant. Except
as expressly required by Section 7.1 or otherwise expressly provided by the Administrator,
no adjustment will be made for dividends or other rights as a stockholder for which a
record date is prior to such date of delivery. |
| 8.8 | Governing
Law; Severability. |
8.8.1 Choice
of Law. 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 Florida, notwithstanding any Florida or other conflict of law provision
to the contrary.
8.8.2 Severability.
If a court of competent jurisdiction holds any provision invalid and unenforceable, the remaining provisions of this Plan shall
continue in effect.
| 8.9 | Captions. Captions
and headings are given to the sections and subsections of this Plan solely as a convenience to facilitate reference. Such headings
shall not be deemed in any way material or relevant to the construction or interpretation of this Plan or any provision thereof. |
| 8.10 | Stock-Based
Awards in Substitution for Stock Options or Awards Granted by Other Corporation.
Awards may be granted to Eligible Persons in substitution for or in connection
with an assumption of employee stock options, SARs, restricted stock or other stock-based
awards granted by other entities to persons who are or who will become Eligible Persons
in respect of the Corporation or one of its Subsidiaries, in connection with a distribution,
merger or other reorganization by or with the granting entity or an affiliated entity,
or the acquisition by the Corporation or one of its Subsidiaries, directly or indirectly,
of all or a substantial part of the stock or assets of the employing entity. The awards
so granted need not comply with other specific terms of this Plan, provided the awards
reflect adjustments giving effect to the assumption or substitution consistent with any
conversion applicable to the Common Stock (or the securities otherwise subject to the
award) in the transaction and any change in the issuer of the security. Any shares that
are delivered and any awards that are granted by, or become obligations of, the Corporation,
as a result of the assumption by the Corporation of, or in substitution for, outstanding
awards previously granted or assumed by an acquired company (or previously granted or
assumed by a predecessor employer (or direct or indirect parent thereof) in the case
of persons that become employed by the Corporation or one of its Subsidiaries in connection
with a business or asset acquisition or similar transaction) shall not be counted against
the Share Limit or other limits on the number of shares available for issuance under
this Plan. |
| 8.11 | Non-Exclusivity
of Plan. Nothing in this Plan shall limit or be deemed to limit the authority
of the Board or the Administrator to grant awards or authorize any other compensation,
with or without reference to the Common Stock, under any other plan or authority. |
| 8.12 | No
Corporate Action Restriction. The existence of this Plan, the award agreements
and the awards granted hereunder shall not limit, affect, or restrict in any way the
right or power of the Corporation or any Subsidiary (or any of their respective shareholders,
boards of directors or committees thereof (or any subcommittees), as the case may be)
to make or authorize: (a) any adjustment, recapitalization, reorganization or other change
in the capital structure or business of the Corporation or any Subsidiary, (b) any merger,
amalgamation, consolidation or change in the ownership of the Corporation or any Subsidiary,
(c) any issue of bonds, debentures, capital, preferred or prior preference stock ahead
of or affecting the capital stock (or the rights thereof) of the Corporation or any Subsidiary,
(d) any dissolution or liquidation of the Corporation or any Subsidiary, (e) any sale
or transfer of all or any part of the assets or business of the Corporation or any Subsidiary,
(f) any other award, grant, or payment of incentives or other compensation under any
other plan or authority (or any other action with respect to any benefit, incentive or
compensation), or (g) any other corporate act or proceeding by the Corporation or any
Subsidiary. No participant, beneficiary or any other person shall have any claim under
any award or award agreement against any member of the Board or the Administrator, or
the Corporation or any employees, officers or agents of the Corporation or any Subsidiary,
as a result of any such action. |
| 8.13 | Other
Company Benefit and Compensation Programs. Payments and other benefits received
by a participant under an award made pursuant to this Plan shall not be deemed a part
of a participant’s compensation for purposes of the determination of benefits under
any other employee welfare or benefit plans or arrangements, if any, provided by the
Corporation or any Subsidiary, except where the Administrator expressly otherwise provides
or authorizes in writing. Awards under this Plan may be made in addition to, in combination
with, as alternatives to or in payment of grants, awards or commitments under any other
plans, arrangements or authority of the Corporation or its Subsidiaries. |
| 8.14 | Clawback
Policy. The awards granted under this Plan are subject to the terms of the Corporation’s
recoupment, clawback or similar policy as it may be in effect from time to time, as well
as any similar provisions of applicable law, any of which could in certain circumstances
require repayment or forfeiture of awards or any shares of Common Stock or other cash
or property received with respect to the awards (including any value received from a
disposition of the shares acquired upon payment of the awards). |