THE KNOT, INC.
2009 EMPLOYEE STOCK PURCHASE
PLAN
The purpose of
this Plan is to provide eligible employees of The Knot, Inc. (the
“ Company ”) and certain of its
subsidiaries with opportunities to purchase shares of the
Company’s common stock, $0.01 par value (the “
Common Stock ”), commencing on August 1,
2009. Three Hundred Thousand (300,000) shares of Common
Stock in the aggregate have been approved for this
purpose. This Plan is intended to qualify as an
“employee stock purchase plan” as defined in Section
423 of the Internal Revenue Code of 1986, as amended (the “
Code ”), and the regulations promulgated
thereunder, and shall be interpreted consistent
therewith.
1.
Administration . The Plan will be administered by
the Company’s Board of Directors (the “
Board ”) or by a Committee appointed by the
Board (the “ Committee ”). The
Board or the Committee has authority to make rules and regulations
for the administration of the Plan and its interpretation and
decisions with regard thereto shall be final and
conclusive.
2. Eligibility
. All employees of the Company, including Directors who
are employees, and all employees of any subsidiary of the Company
(as defined in Section 424(f) of the Code) designated by the
Board or the Committee from time to time (a “
Designated Subsidiary ”), are eligible to
participate in any one or more of the offerings of Options (as
defined in Section 9) to purchase Common Stock under the Plan
provided that:
(a) they are
customarily employed by the Company or a Designated Subsidiary for
more than 20 hours a week and for more than five months in a
calendar year; and
(b) they are employees
of the Company or a Designated Subsidiary on the first day of the
applicable Plan Period (as defined below).
No employee may be granted an option hereunder
if such employee, immediately after the option is granted, owns 5%
or more of the total combined voting power or value of the
stock of the Company or any subsidiary. For
purposes of the preceding sentence, the attribution rules of
Section 424(d) of the Code shall apply in determining the
stock ownership of an employee, and all stock which the employee
has a contractual right to purchase shall be treated as stock owned
by the employee.
3. Offerings
. The Company will make one or more offerings (“
Offerings ”) to employees to purchase stock
under this Plan. Offerings will begin each February 1
and August 1, or the first business day thereafter (the “
Offering Commencement Dates ”). Each
Offering Commencement Date will begin a six-month period (a “
Plan Period ”) during which payroll deductions
will be made and held for the purchase of Common Stock at the end
of the Plan Period. The Board or the Committee may, at
its discretion, choose a different Plan Period of twelve (12)
months or less for subsequent Offerings.
4.
Participation . An employee eligible on the
Offering Commencement Date of any Offering may participate in such
Offering by providing authorization for payroll deductions to the
Company on or prior to the applicable Offering Commencement Date in
accordance with the Company’s procedures in effect from time
to time. The employee’s authorization will
permit a regular payroll deduction from the Base Salary received by
the employee during the Plan Period. Unless an employee
provides a new authorization or withdraws from the Plan, the
employee’s deductions and purchases will continue at the same
rate for future Offerings under the Plan as long as the Plan
remains in effect. The term “ Base
Salary ” means the regular base salary paid to an
employee by the Company or a Designated Subsidiary during each such
individual’s period of participation in the Plan, plus any
pre-tax contributions made by the employee to any Code Section
401(k) salary deferral plan or any Code Section 125 cafeteria
benefit program now or hereafter established by the Company or any
Designated Subsidiary. Base Salary shall not include any
overtime payments, bonuses, commissions, profit-sharing
distributions or other incentive-type payments or any contributions
(other than Code Section 401(k) or Code Section 125
contributions) made on the employee’s behalf by the Company
or any Designated Subsidiary to any employee benefit or welfare
plan now or hereafter established.
5. Deductions
. The Company will maintain payroll deduction accounts
for all participating employees. With respect to any
Offering made under this Plan, an employee may authorize a payroll
deduction in any dollar amount up to a maximum of 15% of the Base
Salary he or she receives during the Plan Period or such shorter
period during which deductions from payroll are
made. The Board or the Committee may, at its discretion,
designate a lower maximum contribution rate. Payroll
deductions may be at the rate of any whole number percentage
between 1% and up to and including 15% of Base Salary with any
change in compensation during the Plan Period to result in an
automatic corresponding change in the dollar amount
withheld. The minimum payroll deduction is such
percentage of compensation as may be established from time to time
by the Board or the Committee.
6. Deduction
Changes . An employee may decrease or discontinue
his or her payroll deduction once during any Plan Period,
by filing a new payroll deduction authorization
form. However, an employee may not increase the
payroll deduction during a Plan Period. If an employee
elects to discontinue the payroll deductions during a Plan Period,
but does not elect to withdraw his or her funds pursuant to
Section 8 hereof, funds deducted prior to the election to
discontinue will be applied to the purchase of Common Stock on the
Exercise Date (as defined below).
7. Interest
. Interest will not be paid on any employee accounts,
except to the extent that the Board or the Committee, in its
sole discretion, elects to credit employee accounts with interest
at such per annum rate as it may from time to time
determine.
8. Withdrawal of
Funds . An employee may at any time prior to the
close of business on the last business day in a Plan Period and for
any reason permanently draw out the balance accumulated in the
employee’s account and thereby withdraw from participation in
an Offering. Partial withdrawals are not
permitted. The employee may not begin participation
again during the remainder of the Plan Period. The
employee may participate in any subsequent Offering in accordance
with terms and conditions established by the Board or the
Committee.
9. Grant of
Option; Purchase of Shares .
(a)
Number of Shares
. On
the Offering Commencement Date of each Plan Period, the Company
will grant to each eligible employee who is then a participant in
the Plan an option (an “ Option ”) to
purchase on the last business day of such Plan Period (the “
Exercise Date ”) at the applicable purchase
price (the “ Option Price ”) up to a
whole number of shares of Common Stock determined by multiplying
$2,083 by the number of full months in the Plan Period and dividing
the result by the closing price (as defined below) on the Offering
Commencement Date for such Plan Period; provided ,
however , that no employee may be granted an Option which
permits his or her rights to purchase Common Stock under this Plan
and any other employee stock purchase plan (as defined in Section
423(b) of the Code) of the Company and its subsidiaries, to accrue
at a rate which exceeds $25,000 of the fair market value of such
Common Stock for each calendar year in which the Option is
outstanding at any time; and provided ,
further , however , that the maximum number of shares
of Common Stock purchasable by an employee under any Option during
a Plan Period shall not exceed one thousand (1,000) shares, subject
to adjustment under Section 15 hereof, and provided ,
further , however , that the maximum number of shares
of Common Stock purchasable by all employees un
