Exhibit 10.1
CRYOLIFE, INC.
2009 EMPLOYEE STOCK INCENTIVE
PLAN
SECTION 1
GENERAL
1.1 Purpose . The
CryoLife, Inc. 2009 Employee Stock Incentive Plan (the
“Plan”) has been established by CryoLife, Inc. (the
“Company”) to (i) attract and retain persons
eligible to participate in the Plan; (ii) motivate
Participants (as defined in Section 1.2 below), by means of
appropriate incentives, to achieve long-range goals;
(iii) provide incentive compensation opportunities that are
competitive with those of other similar companies; and
(iv) further identify Participants’ interests with those
of the Company’s stockholders through compensation that is
based on the Company’s common stock; and thereby promote the
long-term financial interests of the Company and its Subsidiaries,
as defined in Section 9(h), including the growth in value of
the Company’s equity and enhancement of long-term stockholder
return. Pursuant to the Plan, Participants may receive Options,
SARs, or Other Stock Awards, each as defined herein (collectively
referred to as “Awards”). The Plan is designed so that
Awards granted hereunder intended to comply with the requirements
for “performance-based compensation” under
Section 162(m) of the Internal Revenue Code of 1986, as
amended (the “Code”), may comply with such
requirements, and the Plan and such Awards shall be interpreted in
a manner consistent with such requirements.
1.2 Participation .
Subject to the terms and conditions of the Plan, the Committee (as
defined in Section 6) shall determine and designate, from time
to time, from among the Eligible Grantees, as defined in
Section 9(f), those persons who will be granted one or more
Awards under the Plan, and thereby become
“Participants” in the Plan. In the discretion of the
Committee, a Participant may be granted any Award permitted under
the provisions of the Plan, and more than one Award may be granted
to a Participant. Subject to the provisions of Section 6.2(e),
Awards may be granted as alternatives to or replacement of awards
outstanding under the Plan, or any other plan or arrangement of the
Company or a Subsidiary (including a plan or arrangement of a
business or entity, all or a portion of which is acquired by the
Company or a Subsidiary).
1.3 Operation,
Administration, and Definitions . The operation and
administration of the Plan, including the Awards made under the
Plan, shall be subject to the provisions of Section 5
(relating to operation and administration). Capitalized terms in
the Plan shall be defined as set forth in the Plan (including the
definition provisions of Section 9 of the Plan).
SECTION 2
OPTIONS AND SARS
2.1
Definitions.
(a) The grant of an
“Option” entitles the Participant to purchase shares of
Stock at an Exercise Price established by the Committee. Options
granted under this Section 2 may either be Incentive Stock
Options (“ISOs”) or Non-Qualified Options
(“NQOs”), as determined in the discretion of the
Committee. An “ISO” is an Option that is intended to
satisfy the requirements applicable to an “incentive stock
option” described in Section 422(b) of the Code. An
“NQO” is an Option that is not intended to be an
“incentive stock option” as that term is described in
Section 422(b) of the Code.
(b) A stock appreciation right
(a “SAR”) entitles the Participant to receive, in cash
or Stock (as determined in accordance with Subsection 2.5), value
equal to (or otherwise based on) the excess of: (a) the Fair
Market Value (as defined in Section 9) of a specified number
of shares of Stock at the time of exercise; over (b) an
Exercise Price established by the Committee.
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2.2 Exercise Price .
The Exercise Price of each Option and SAR granted under this
Section 2 shall be not less than 100% of the Fair Market Value
of a share of Stock on the date of grant of the Award. Unless a
higher price is established by the Committee or determined by a
method established by the Committee at the time the Option or SAR
is granted, the Exercise Price for each Option and SAR shall be
equal to 100% of the Fair Market Value on the date of grant of the
Award.
2.3 Exercise . An
Option and a SAR shall be exercisable in accordance with such terms
and conditions and during such periods as may be established by the
Committee, before or after grant.
2.4 Payment of Option
Exercise Price . The payment of the Exercise Price of an Option
granted under this Section 2 shall be subject to the
following:
(a) Subject to the following
provisions of this Subsection 2.4, the full Exercise Price for
shares of Stock purchased upon the exercise of any Option shall be
paid at the time of such exercise (except that, in the case of an
exercise arrangement approved by the Committee and described in
paragraph 2.4(c), payment may be made as soon as practicable after
the exercise).
(b) The Exercise Price shall be
payable in cash or by tendering (by actual delivery of shares)
unrestricted shares of Stock that are acceptable to the Committee,
valued at Fair Market Value as of the day the shares are tendered,
or in any combination of cash or shares, as determined by the
Committee.
(c) To the extent permitted by
applicable law, a Participant may elect to pay the Exercise Price
upon the exercise of an Option by irrevocably authorizing a third
party to sell shares of Stock (or a sufficient portion of the
shares) acquired upon exercise of the Option and remit to the
Company a sufficient portion of the sale proceeds to pay the entire
Exercise Price and any tax withholding resulting from such
exercise.
2.5 Settlement of Award
. Shares of Stock delivered pursuant to the exercise of an Option
or a SAR shall be subject to such conditions, restrictions and
contingencies as the Committee may establish in the applicable
Award Agreement. Settlement of SARs may be made in shares of Stock
(valued at their Fair Market Value at the time of exercise), in
cash, or in a combination thereof, as determined in the discretion
of the Committee. The Committee, in its discretion, may impose such
conditions, restrictions and contingencies with respect to shares
of Stock acquired pursuant to the exercise of an Option or a SAR as
the Committee determines to be desirable.
2.6 Restrictions on Options
and SAR Awards . Each Option and SAR shall be subject to the
following:
(a) The term of any Option or SAR
granted under the Plan shall not exceed seven years from the date
of grant.
(b) Any such Award shall be
subject to such conditions, restrictions and contingencies as the
Committee shall determine.
(c) The Committee may designate
whether any such Awards being granted to any Participant are
intended to be “performance-based compensation” as that
term is used in Section 162(m) of the Code. Any such Awards
designated as intended to be “performance-based
compensation” shall be conditioned on the achievement of one
or more “Performance Measures.” The Performance
Measures that may be used by the Committee for such Awards shall be
based on any one or more of the following, which shall not be
required to be calculated in accordance with GAAP, as selected by
the Committee: return on capital or increase in pretax earnings of
the Company and/or one or more divisions and/or subsidiaries,
return on stockholders’ equity of the Company, increase in
earnings per share of the Company, sales of the Company and/or one
or more products or service offerings, divisions and/or
subsidiaries, pretax earnings of the Company and/or one or more
divisions and/or subsidiaries, net earnings of the Company and/or
one or more divisions and/or subsidiaries, control of operating
and/or non-operating expenses of the Company and/or one or more
divisions and/or subsidiaries, margins of the Company and/or one or
more divisions and/or subsidiaries, market price of the
Company’s securities, and, solely for an Award not intended
to constitute “performance-based compensation” under
Section 162(m) of the Code, other factors directly tied to
the
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performance of the Company and/or one or more
divisions and/or subsidiaries or other performance criteria. For
Awards intended to be “performance-based compensation,”
the grant of the Awards and the establishment of the Performance
Measures shall be made during the period required under Code
Section 162(m).
SECTION 3
OTHER STOCK AWARDS
3.1 Definitions . The
term “Other Stock Awards” means any of the
following:
(a) A “Stock Unit”
Award is the grant of a right to receive shares of Stock in the
future.
(b) A “Performance
Share” Award is a grant of a right to receive shares of Stock
or Stock Units, which is contingent on the achievement of
performance or other objectives during a specified
period.
(c) A “Restricted
Stock” Award is a grant of shares of Stock, and a
“Restricted Stock Unit” Award is the grant of a right
to receive shares of Stock in the future, with such shares of Stock
or right to future delivery of such shares of Stock subject to a
risk of forfeiture or other restrictions that will lapse upon the
achievement of one or more goals relating to completion of service
by the Participant, or achievement of performance or other
objectives, as determined by the Committee.
3.2 Restrictions on Other
Stock Awards . Each Stock Unit Award, Restricted Stock Award,
Restricted Stock Unit Award and Performance Share Award shall be
subject to the following:
(a) Any such Award shall be
subject to such conditions, restrictions and contingencies as the
Committee shall determine.
(b) The Committee may designate
whether any such Awards being granted to any Participant are
intended to be “performance-based compensation” as that
term is used in Section 162(m) of the Code. Any such Awards
designated as intended to be “performance-based
compensation” shall be conditioned on the achievement of one
or more Performance Measures.
SECTION 4
STOCK SUBJECT TO THE PLAN
4.1 Awards Subject to
Plan . Awards granted under the Plan shall be subject to the
following:
(a) Subject to the following
provisions of this Subsection 4.1, the maximum number of shares of
Stock that may be delivered to Participants and their beneficiaries
under the Plan shall be 2 million shares of Stock. Shares of
Stock issuable hereunder may, in whole or in part, be authorized
but unissued shares or shares of Stock that shall have been or may
be reacquired by the Company in the open market, in private
transactions or otherwise. Notwithstanding the foregoing, with
respect to SARs that are settled in Stock, the aggregate number of
shares of Stock subject to the SAR grant shall be counted against
the shares available for issuance under the Plan as one share for
every share subject thereto, regardless of the number of shares
used to settle the SAR upon exercise.
(b) Subject to adjustment in
accordance with Subsections 4.2 and 4.3, the following additional
maximums are imposed under the Plan:
(i) Subject to the proviso
contained in this paragraph, the maximum number of shares of Stock
that may be issued in conjunction with Other Stock Awards granted
pursuant to Section 3 shall be up to 500,000 shares; provided,
however, that for every share of Stock in excess of 500,000 awarded
hereunder in respect of Other Stock Awards, the maximum number of
shares reserved for grant hereunder shall be reduced by 1.5 shares.
By way of
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example, if only grants of Other Stock Awards
are made under the Plan, the maximum number of shares that may be
issued is 1,500,000.
(ii) The maximum number of
shares of Stock that may be covered by Awards granted to any one
individual pursuant to Section 2 (relating to Options and
SARs) shall be 400,000 during any fiscal year and the maximum
number of shares of Stock that may be covered by Other Stock Awards
pursuant to Section 3 shall be 250,000 during any fiscal year;
and
(c) To the extent any shares of
Stock covered by an Award are not delivered to a Participant or
beneficiary because the Award is forfeited or canceled, or the
shares of Stock are not delivered because the Award is settled in
cash, such shares shall not be deemed to have been delivered for
purposes of determining the maximum number of shares of Stock
available for delivery under the Plan. To the extent that shares of
Stock subject to Other Stock Awards, and the issuance of which
reduced the maximum number of shares authorized for issuance under
the Plan by 1.5 shares, are forfeited or cancelled, or if such an
Award terminates or expires without a distribution of shares to the
Participant, the number of shares of Stock remaining for Award
grants hereunder shall be increased by 1.5 for each share
forfeited, cancelled or otherwise not delivered. Shares of Stock
shall not again be available if such shares are surrendered or
withheld as payment of either the exercise price of an Award and/
or withholding taxes in respect of an Award. Awards that are
settled solely in cash shall not reduce the number of shares of
Stock available for Awards. Upon the exercise of any Award granted
in tandem with any other Award, such related Awards shall be
cancelled to the extent of the number of shares of Stock as to
which the Award is exercised and, notwithstanding the foregoing,
such number of shares shall no longer be available for Awards under
the Plan. The maximum number of shares of Stock available for
delivery under the Plan shall not be reduced for shares subject to
plans assumed by the Company in an acquisition of an interest in
another company.
4.2 Adjustments for Changes in
Capitalization . If the outstanding shares of Stock are changed
into or exchanged for a different number or kind of shares or other
securities of the Company by reason of any recapitalization,
reclassification, stock split, stock dividend, combination,
subdivision or similar transaction, or if the Company makes an
extraordinary dividend or distribution to its stockholders
(including without limitation to implement a spinoff) (each, a
“Corporate Transaction”) then, subject to any required
action by the stockholders of the Company, the number and kind of
shares of Company stock available under the Plan or subject to any
limit or maximum hereunder shall automatically be proportionately
adjusted, with no action required on the part of the Committee or
otherwise. Subject to any required action by the stockholders, the
number and kind of shares covered by each outstanding Award, and
the price per share in each such Award, shall also be automatically
proportionately adjusted for any increase or decrease in the number
of issued shares of the Company resulting from a Corporate
Transaction or any other increase or decrease in the number of such
shares, or any decrease in the value of such shares, effected
without receipt of consideration by the Company. Notwithstanding
the foregoing, no fractional shares shall be issued or made subject
to an Option, SAR or Stock Award in making the foregoing
adjustments. All adjustments made pursuant to this Section shall be
final, conclusive and binding upon the holders of Options, SARS and
Stock Awards.
4.3 Certain Mergers and Other
Extraordinary Events . If the Company merges or consolidates
with another corporation, or if the Company is liquidated or sells
or otherwise disposes of substantially all of its assets while
unexercised Options or other Awards remain outstanding under this
Plan, (A) subject to the provisions of clause (C) below,
after the effective date of the merger, consolidation, liquidation,
sale or other disposition, as the case may be, whether or not the
Company is the surviving corporation, each holder of an outstanding
Option or other Award shall be entitled, upon exercise of that
Option or Award or in place of it, as the case may be, to receive,
at the option of the Committee and in lieu of shares of Stock,
(i) the number and class or classes of shares of Stock or
other securities or property to which the holder would have been
entitled if, immediately prior to the merger, consolidation,
liquidation, sale or other disposition, the holder had been the
holder of record of a number of shares of Stock equal to the number
of shares of Stock as to which that Option may be exercised or are
subject to the Award or (ii) shares of stock of the company
that is the surviving corporation in such merger, consolidation,
liquidation, sale or other disposition having a value, as of the
date of payment under Subsection 4.3(i) as determined by the
Committee in its sole discretion, equal to the value of the shares
of Stock or other securities or property otherwise payable under
Subsection 4.3(i); (B) whether or not the Company is the
surviving corporation, if Options or other Awards have not already
become exercisable, the Board of Directors may waive any
limitations set forth in
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or imposed pursuant to this Plan so that all
Options or other Awards, from and after a date prior to the
effective date of that merger, consolidation, liquidation, sale or
other disposition, as the case may be, specified by the Board of
Directors, shall be exercisable in full; and (C) all
outstanding Options or SARs may be cancelled by the Board of
Directors as of the effective date of any merger, consolidation,
liquidation, sale or other disposition, provided that with respect
to a merger or consolidation the Company is not the surviving
company, and provided further that any optionee or SAR holder shall
have the right immediately prior to such event to exercise his or
her Option or SAR to the extent such optionee or holder is
otherwise able to do so in accordance with this Plan or his
individual Option or SAR agreement; provided, further, that any
such cancellation pursuant to this Section 4.3 shall be
contingent upon the payment to the affected Participants of an
amount equal to (i) in the case of any out-of-the-money Option
or SAR, cash, property or a combination thereof having an aggregate
value equal to the value of such Option or SAR, as determined by
the Committee or the Board of Directors, as applicable, in its sole
discretion, and (ii) in the case of an in-the-money Option or
SAR, cash, property or a combination thereof having an aggregate
value equal to the excess of the value of the per-share amount of
consideration paid pursuant to the merger, consolidation,
liquidation, sale or other disposition, as the case may be, giving
rise to such cancellation, over the exercise price of such Option
or SAR multiplied by the number of shares of Stock subject to the
Option or SAR.
Any adjustments pursuant to this
Subsection 4.3 shall be made by the Board or Committee, as the case
may be, whose determination in that respect shall be final, binding
and conclusive, regardless of whether or not any such adjustment
shall have the result of causing an ISO to cease to qualify as an
ISO.
4.4 Changes in Par Value . In
the event of a change in the shares of the Company as presently
constituted, which is limited to a change of all of its authorized
shares with par value into the same number of shares with a
different par value or without par value, the shares resulting from
any such change shall be deemed to be the shares within the meaning
of this Plan.
4.5 Limitation on Grantees’
Rights . Except as hereinbefore expressly provided in this
Section 4, a Participant shall have no rights by reason of any
subdivision or consolidation of shares of stock of any class or the
payment of any stock dividend or any other increase or decrease in
the number of shares of stock of any class or by reason of any
dissolution, liquidation, merger, or consolidation or spin-off of
assets or stoc
