INVESCO MORTGAGE CAPITAL
INC.
2009 EQUITY INCENTIVE
PLAN
1.
PURPOSE . The Plan is intended to provide incentives to
directors, officers, advisors, consultants, key employees, and
others expected to provide significant services to the Company and
its Subsidiaries, including the personnel, employees, officers and
directors of the other Participating Companies, to encourage a
proprietary interest in the Company, to encourage such key
personnel to remain in the service of the Company and the other
Participating Companies, to attract new personnel with outstanding
qualifications, and to afford additional incentive to others to
increase their efforts in providing significant services to the
Company and the other Participating Companies. In furtherance
thereof, the Plan permits awards of equity-based incentives to key
personnel, employees, officers and directors of, and certain other
providers of services to, the Company or any other Participating
Company.
2.
DEFINITIONS . As used in this Plan, the following
definitions apply:
"Act" shall mean the Securities Act
of 1933, as amended.
"Award Agreement" shall mean a
written agreement evidencing a Grant pursuant to the
Plan.
"Board" shall mean the Board of
Directors of the Company.
"Cause" shall mean, unless otherwise
provided in the Grantee's Award Agreement, (i) engaging in
(A) willful or gross misconduct or (B) willful or gross
neglect, (ii) repeatedly failing to adhere to the directions
of superiors or the Board or the written policies and practices of
the Company, the Subsidiaries, the Manager or any of their
respective affiliates, (iii) the commission of a felony or a
crime of moral turpitude, or any crime involving the Company, the
Subsidiaries, the Manager or any of their respective affiliates,
(iv) fraud, misappropriation, embezzlement or material or
repeated insubordination, (v) a material breach of the
Grantee's employment agreement (if any) with the Company, the
Subsidiaries, the Manager or any of their respective affiliates
(other than a termination of employment by the Grantee), or
(vi) any illegal act detrimental to the Company; the
Subsidiaries, the Manager or any of their respective affiliates,
all as determined by the Committee.
“Change in Control”
means unless otherwise provided in an Award Agreement the happening
of any of the following:
(i) any “person,”
including a “group” (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act, but excluding the Company, any
entity controlling, controlled by or under common control with the
Company, any trustee, fiduciary or other person or entity holding
securities under any employee benefit plan or trust of the Company
or any such entity, and, with respect to any particular
Participant, the Participant and any “group” (as such
term is used in Section 13(d)(3) of the Exchange Act) of which the
Participant is a member), is or becomes the “beneficial
owner” (as defined in Rule 13(d)(3) under the Exchange Act),
directly or indirectly, of securities of the Company representing
50% or more of either (A) the combined voting power of the
Company’s then outstanding securities or (B) the then
outstanding Shares (in either such case other than as a result of
an acquisition of securities directly from the Company);
or
(ii) any consolidation or merger of
the Company where the shareholders of the Company, immediately
prior to the consolidation or merger, would not, immediately after
the consolidation or merger, beneficially own (as such term is
defined in Rule 13d-3 under the Exchange Act), directly
or
AMR #126358-v7
indirectly, shares representing in
the aggregate 50% or more of the combined voting power of the
securities of the corporation issuing cash or securities in the
consolidation or merger (or of its ultimate parent corporation, if
any); or
(iii) there shall occur (A) any
sale, lease, exchange or other transfer (in one transaction or a
series of transactions contemplated or arranged by any party as a
single plan) of all or substantially all of the assets of the
Company, other than a sale or disposition by the Company of all or
substantially all of the Company’s assets to an entity, at
least 50% of the combined voting power of the voting securities of
which are owned by “persons” (as defined above) in
substantially the same proportion as their ownership of the Company
immediately prior to such sale or (B) the approval by shareholders
of the Company of any plan or proposal for the liquidation or
dissolution of the Company; or
(iv) the members of the Board at the
beginning of any consecutive 24-calendar-month period (the
“Incumbent Directors”) cease for any reason other than
due to death to constitute at least a majority of the members of
the Board; provided that any Director whose election, or nomination
for election by the Company’s shareholders, was approved or
ratified by a vote of at least a majority of the members of the
Board then still in office who were members of the Board at the
beginning of such 24-calendar-month period, shall be deemed to be
an Incumbent Director.
Notwithstanding the foregoing, no
event or condition shall constitute a Change in Control to the
extent that, if it were, a 20% tax would be imposed under Section
409A of the Code; provided that, in such a case, the event or
condition shall continue to constitute a Change in Control to the
maximum extent possible (e.g., if applicable, in respect of vesting
without an acceleration of distribution) without causing the
imposition of such 20% tax.
"Code" shall mean the Internal
Revenue Code of 1986, as amended.
"Committee" shall mean the
Compensation Committee of the Company as appointed by the Board in
accordance with Section 4 of the Plan; provided ,
however , that the Committee shall at all times consist
solely of persons who, at the time of their appointment, each
qualified as a "Non-Employee Director" under
Rule 16b-3(b)(3)(i) promulgated under the Exchange Act and, to
the extent that relief from the limitation of Section 162(m)
of the Code is sought, as an "Outside Director" under
Section 1.162-27(e)(3)(i) of the Treasury
Regulations.
"Common Stock" shall mean the
Company's common stock, par value $0.01 per share, either currently
existing or authorized hereafter.
"Company" shall mean Invesco
Mortgage Capital Inc., a Maryland corporation.
"DER" shall mean a right awarded
under Section 11 of the Plan to receive (or have credited) the
equivalent value (in cash or Shares) of dividends paid on Common
Stock.
"Disability" shall mean, unless
otherwise provided by the Committee in the Grantee's Award
Agreement, the occurrence of an event which would entitle the
Grantee to the payment of disability income under an approved
long-term disability income plan or a long-term disability as
determined by the Committee in its absolute discretion pursuant to
any other standard as may be adopted by the Committee.
Notwithstanding the foregoing, no circumstances or condition shall
constitute a Disability to the extent that, if it were, a 20% tax
would be imposed under Section 409A of the Code; provided that, in
such a case, the event or condition shall continue to constitute a
Disability to the maximum extent possible (e.g., if applicable, in
respect of vesting without an acceleration of distribution) without
causing the imposition of such 20% tax.
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AMR #126358-v7
"Eligible Persons" shall mean
officers, directors, personnel and employees of the Participating
Companies and other persons expected to provide significant
services (of a type expressly approved by the Committee as covered
services for these purposes) to one or more of the Participating
Companies. For purposes of the Plan, a consultant, vendor, customer
or other provider of significant services to the Company or any
other Participating Company shall be deemed to be an Eligible
Person, but will be eligible to receive Grants (but in no event
Incentive Stock Options), only after a finding by the Committee in
its discretion that the value of the services rendered or to be
rendered to the Participating Company is at least equal to the
value of the Grants being awarded.
"Employee" shall mean an individual,
including an officer of a Participating Company, who is employed
(within the meaning of Code Section 3401 and the regulations
thereunder) by the Participating Company.
"Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
"Exercise Price" shall mean the
price per Share of Common Stock, determined by the Board or the
Committee, at which an Option may be exercised.
"Fair Market Value" shall mean the
value of one share of Common Stock, determined as
follows:
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(i)
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If the Shares are then listed on a
national stock exchange, the closing sales price per Share on the
exchange for the last preceding date on which there was a sale of
Shares on such exchange, as determined by the Committee.
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(ii)
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If the Shares are not then listed on
a national stock exchange but are then traded on an
over-the-counter market, the average of the closing bid and asked
prices for the Shares in such over-the-counter market for the last
preceding date on which there was a sale of such Shares in such
market, as determined by the Committee.
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(iii)
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If neither (i) nor (ii) applies,
such value as the Committee in its discretion may in good faith
determine. Notwithstanding the foregoing, where the Shares are
listed or traded, the Committee may make discretionary
determinations in good faith where the Shares have not been traded
for 10 trading days.
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Notwithstanding the foregoing, with
respect to any “stock right” within the meaning of
Section 409A of the Code, Fair Market Value shall not be less than
the “fair market value” of the shares of Common Stock
determined in accordance with the final regulations promulgated
under Section 409A of the Code.
"Grant" shall mean the issuance of
an Incentive Stock Option, Non-qualified Stock Option, Restricted
Stock, Phantom Share, DER, other equity-based grant as contemplated
herein or any combination thereof as applicable to an Eligible
Person. The Committee will determine the eligibility of personnel,
employees, officers, directors and others expected to provide
significant services to the Participating Companies based on, among
other factors, the position and responsibilities of such
individuals, the nature and value to the Participating Company of
such individuals' accomplishments and potential contribution to the
success of the Participating Company whether directly or through
its subsidiaries.
"Grantee" shall mean an Eligible
Person to whom Options, Restricted Stock, Phantom Shares, DERs,
Partnership Units or other equity-based awards are granted
hereunder.
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AMR #126358-v7
"Incentive Stock Option" shall mean
an Option of the type described in Section 422(b) of the Code
issued to an Employee of (i) the Company, or (ii) a
“subsidiary corporation” or a “parent
corporation” as defined in Section 424(f) of the
Code.
"Manager" shall mean Invesco
Institutional (N.A.), Inc. the Company’s manager.
"Non-qualified Stock Option" shall
mean an Option not described in Section 422(b) of the
Code.
"Option" shall mean any option,
whether an Incentive Stock Option or a Non-qualified Stock Option,
to purchase, at a price and for the term fixed by the Committee in
accordance with the Plan, and subject to such other limitations and
restrictions in the Plan and the applicable Award Agreement, a
number of Shares determined by the Committee.
"Optionee" shall mean any Eligible
Person to whom an Option is granted, or the Successors of the
Optionee, as the context so requires.
"Participating Companies" shall mean
the Company, the Subsidiaries, the Manager and any of their
respective affiliates, which with the consent of the Board
participates in the Plan.
"Partnership Units" shall mean any
OP Units, Preferred Units, Junior Units or any other fractional
share of Partnership Interests as defined in, and authorized
pursuant to, the Award Agreement of Limited Partnership of IAS
Operating Partnership, LP, as amended from time to time.
“Performance Goals” has
the meaning set forth in Section 13.
"Phantom Share" shall mean a right,
pursuant to the Plan, of the Grantee to payment of the Phantom
Share Value.
"Phantom Share Value," per Phantom
Share, shall mean the Fair Market Value of a Share or, if so
provided by the Committee, such Fair Market Value to the extent in
excess of a base value established by the Committee at the time of
grant.
"Plan" shall mean the Company's 2009
Equity Incentive Plan, as set forth herein, and as the same may
from time to time be amended.
"Purchase Price" shall mean the
Exercise Price times the number of Shares with respect to which an
Option is exercised.
"Restricted Stock" shall mean an
award of Shares that are subject to restrictions
hereunder.
"Retirement" shall mean, unless
otherwise provided by the Committee in the Grantee's Award
Agreement, the Termination of Service (other than for Cause) of a
Grantee:
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(i)
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on or after the Grantee's attainment
of age 65;
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(ii)
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on or after the Grantee's attainment
of age 55 with five consecutive years of service with the
Participating Companies; or
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(iii)
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as determined by the Committee in
its absolute discretion pursuant to such other standard as may be
adopted by the Committee.
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AMR #126358-v7
"Shares" shall mean shares of Common
Stock of the Company, adjusted in accordance with Section 15
of the Plan (if applicable).
"Subsidiary" shall mean any
corporation, partnership, limited liability company or other entity
at least 50% of the economic interest in the equity of which is
owned, directly or indirectly, by the Company or by another
subsidiary.
"Successors of the Optionee" shall
mean the legal representative of the estate of a deceased Optionee
or the person or persons who shall acquire the right to exercise an
Option by bequest or inheritance or by reason of the death of the
Optionee.
"Termination of Service" shall mean
the time when the employee-employer relationship or directorship,
or other service relationship (sufficient to constitute service as
an Eligible Person), between the Grantee and the Participating
Companies is terminated for any reason, with or without Cause,
including, but not limited to, any termination by resignation,
discharge, death or Retirement; provided , however ,
Termination of Service shall not include a termination where there
is a simultaneous continuation of service of the Grantee
(sufficient to constitute service as an Eligible Person) for a
Participating Company. The Committee, in its absolute discretion,
shall determine the effects of all matters and questions relating
to Termination of Service, including, but not limited to, the
question of whether any Termination of Service was for Cause and
all questions of whether particular leaves of absence constitute
Terminations of Service. For this purpose, the service relationship
shall be treated as continuing intact while the Grantee is on
military leave, sick leave or other bona fide leave of absence (to
be determined in the discretion of the Committee).
3.
EFFECTIVE DATE . The effective date of the Plan is June __,
2009.
4.
ADMINISTRATION .
(a)
Membership on Committee. The Plan
shall be administered by the Committee appointed by the Board. If
no Committee is designated by the Board to act for those purposes,
the full Board shall have the rights and responsibilities of the
Committee hereunder and under the Award Agreements.
(b)
Committee Meetings. The acts of a
majority of the members present at any meeting of the Committee at
which a quorum is present, or acts approved in writing by a
majority of the entire Committee, shall be the acts of the
Committee for purposes of the Plan. If and to the extent
applicable, no member of the Committee may act as to matters under
the Plan specifically relating to such member.
(c) Grant
of Awards.
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(i)
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The Committee shall from time to
time at its discretion select the Eligible Persons who are to be
issued Grants and determine the number and type of Grants to be
issued under any Award Agreement to an Eligible Person. In
particular, the Committee shall (A) determine the terms and
conditions, not inconsistent with the terms of the Plan, of any
Grants awarded hereunder (including, but not limited to the
performance goals and periods applicable to the award of Grants);
(B) determine the time or times when and the manner and
condition in which each Option shall be exercisable and the
duration of the exercise period; and (C) determine or impose
other conditions to the Grant or exercise of Options under the Plan
as it may deem appropriate. The Committee may establish such rules,
regulations and procedures for the administration of the Plan as it
deems appropriate, determine the extent, if any, to which
Options,
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AMR #126358-v7
Phantom Shares, Shares (whether or
not Shares of Restricted Stock), DERs, Partnership Units or other
equity-based awards shall be forfeited (whether or not such
forfeiture is expressly contemplated hereunder), and take any other
actions and make any other determinations or decisions that it
deems necessary or appropriate in connection with the Plan or the
administration or interpretation thereof. The Committee shall also
cause each Option to be designated as an Incentive Stock Option or
a Non-qualified Stock Option, except that no Incentive Stock
Options may be granted to an Eligible Person who is not an Employee
of the Company or a “subsidiary corporation” or a
“parent corporation” as defined in Section 424(f) of
the Code. The Grantee shall take whatever additional actions and
execute whatever additional documents the Committee may in its
reasonable judgment deem necessary or advisable in order to carry
or effect one or more of the obligations or restrictions imposed on
the Grantee pursuant to the express provisions of the Plan and the
Award Agreement. DERs will be exercisable separately or together
with Options, and paid in cash or other consideration at such times
and in accordance with such rules, as the Committee shall determine
in its discretion. Unless expressly provided hereunder, the
Committee, with respect to any Grant, may exercise its discretion
hereunder at the time of the award or thereafter. The Committee
shall have the right and responsibility to interpret the Plan and
the interpretation and construction by the Committee of any
provision of the Plan or of any Grant thereunder, including,
without limitation, in the event of a dispute, shall be final and
binding on all Grantees and other persons to the maximum extent
permitted by law. Without limiting the generality of
Section 23, no member of the Committee shall be liable for any
action or determination made in good faith with respect to the Plan
or any Grant hereunder.
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(ii)
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Notwithstanding clause (i) of
this Section 4(c), any award under the Plan to an Eligible
Person who is a member of the Committee shall be made by the full
Board, but for these purposes the directors of the Corporation who
are on the Committee shall be required to be recused in respect of
such awards and shall not be permitted to vote.
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(i)
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Agreements. Grants to Eligible
Persons shall be evidenced by written Award Agreements in such form
as the Committee shall from time to time determine (which Award
Agreements need not be in the same form as any other Award
Agreement evidencing Grants under the Plan and need not contain
terms and conditions identical to those applicable to any other
Grant under the Plan or to those applicable to any other Eligible
Persons). Such Award Agreements shall comply with and be subject to
the terms and conditions set forth below.
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(ii)
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Number of Shares. Each Grant issued
to an Eligible Person shall state the number of Shares to which it
pertains or which otherwise underlie the Grant and shall provide
for the adjustment thereof in accordance with the provisions of
Section 15 hereof.
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(iii)
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Grants. Subject to the terms and
conditions of the Plan and consistent with the Company's intention
for the Committee to exercise the greatest permissible
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AMR #126358-v7
flexibility under Rule 16b-3
under the Exchange Act in awarding Grants, the Committee shall have
the power:
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(1)
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to determine from time to time the
Grants to be issued to Eligible Persons under the Plan and to
prescribe the terms and provisions (which need not be identical) of
Grants issued under the Plan to such persons;
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(2)
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to construe and interpret the Plan
and the Grants thereunder and to establish, amend and revoke the
rules, regulations and procedures established for the
administration of the Plan. In this connection, the Committee may
correct any defect or supply any omission, or reconcile any
inconsistency in the Plan, in any Award Agreement, or in any
related agreements, in the manner and to the extent it shall deem
necessary or expedient to make the Plan fully effective. All
decisions and determinations by the Committee in the exercise of
this power shall be final and binding upon the Participating
Companies and the Grantees;
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(3)
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to amend any outstanding Grant,
subject to Section 17, and to accelerate or extend the vesting
or exercisability of any Grant (in compliance with Section 409A of
the Code, if applicable) and to waive conditions or restrictions on
any Grants, to the extent it shall deem appropriate; and
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(4)
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generally to exercise such powers
and to perform such acts as are deemed necessary or expedient to
promote the best interests of the Company with respect to the
Plan.
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5. PARTICIPATION
.
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(a) Eligibility. Only Eligible
Persons shall be eligible to receive Grants under the
Plan.
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(b)
Limitation of Ownership. No Grants
shall be issued under the Plan to any person who after such Grant
would beneficially own more than 9.8% by value or number of shares,
whichever is more restrictive, of the outstanding shares of Common
Stock of the Company, or 9.8% by value or number of shares,
whichever is more restrictive, of the outstanding capital stock of
the Company, unless the foregoing restriction is expressly and
specifically waived by action of the independent directors of the
Board.
(c)
Stock Ownership. For purposes of
Section 5(b) above, in determining stock ownership a Grantee
shall be considered as owning the stock owned, directly or
indirectly, by or for his brothers, sisters, spouses, ancestors and
lineal descendants. Stock owned, directly or indirectly, by or for
a corporation, partnership, estate or trust shall be considered as
being owned proportionately by or for its stockholders, partners or
beneficiaries. Stock with respect to which any person holds an
Option shall be considered to be owned by such person.
(d)
Outstanding Stock. For purposes of
Section 5(b) above, "outstanding shares" shall include all
stock actually issued and outstanding immediately after the issue
of the Grant to the Grantee. With respect to the stock ownership of
any Grantee, "outstanding shares" shall include shares authorized
for issue under outstanding Options held by such Grantee, but not
options held by any other person.
6.
STOCK . Subject to adjustments pursuant to
Section 15, Grants with respect to an aggregate of no more
than 40 million Shares may be granted under the Plan (all of which
may be issued as Options);
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AMR #126358-v7
provided , that no Grant may cause the total number of
shares of Common Stock subject to all outstanding awards to exceed
6% of the issued and outstanding shares of Common Stock on a fully
diluted basis (assuming, if applicable, the exercise of all
outstanding Options and the conversion of all warrants, OP Units
and convertible securities into shares of Common Stock). Subject to
adjustments pursuant to Section 15, (i) the maximum
number of Shares with respect to which any Options may be granted
in any one year to any Grantee shall not exceed 700,000, and
(ii) the maximum number of Shares that may underlie Grants,
other than Grants of Options, in any one year to any Grantee shall
not exceed 700,000. Notwithstanding the first sentence of this
Section 6, (i) Shares that have been granted as
Restricted Stock or that have been reserved for distribution in
payment for Options or Phantom Shares but are later forfeited or
for any other reason are not payable under the Plan; and
(ii) Shares as to which an Option is granted under the Plan
that remains unexercised at the expiration, forfeiture or other
termination of such Option, may be the subject of the issue of
further Grants. Shares of Common Stock issued hereunder may
consist, in whole or in part, of authorized and unissued shares,
treasury shares or previously issued Shares under the Plan. The
certificates for Shares issued hereunder may include any legend
which the Committee deems appropriate to reflect any restrictions
on transfer hereunder or under the Award Agreement, or as the
Committee may otherwise deem appropriate. Shares subject to DERs,
other than DERs based directly on the dividends payable with
respect to Shares subject to Options or the dividends payable on a
number of Shares corresponding to the number of Phantom Shares
awarded, shall be subject to the limitation of this Section 6.
Notwithstanding the limitations above in this Section 6,
except in the case of Grants intended to qualify for relief from
the limitations of Section 162(m) of the Code, there shall be
no limit on the number of Phantom Shares or DERs to the extent they
are paid out in cash that may be granted under the Plan. If any
Phantom Shares or DERs are paid out in cash, the underlying Shares
may again be made the subject of Grants under the Plan,
notwithstanding the first sentence of this
Section 6.
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7.
TERMS AND CONDITIONS OF OPTIONS .
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(a)
Each Award Agreement with an
Eligible Person shall state the Exercise Price. The Exercise Price
for any Option shall not be less than the Fair Market Value on the
date of Grant.
(b)
Medium and Time of Payment. Except
as may otherwise be provided below, the Purchase Price for each
Option granted to an Eligible Person shall be payable in full in
United States dollars upon the exercise of the Option. In the event
the Company determines that it is required to withhold taxes as a
result of the exercise of an Option, as a condition to the exercise
thereof, an Employee may be required to make arrangements
satisfactory to the Company to enable it to satisfy such
withholding requirements in accordance with Section 21. If the
applicable Award Agreement so provides, or the Committee otherwise
so permits, the Purchase Price may be paid in one or a combination
of the following:
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(i)
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by a certified or bank cashier's
check;
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(ii)
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by the surrender of shares of Common
Stock in good form for transfer, owned by the person exercising the
Option and having a Fair Market Value on the date of exercise equal
to the Purchase Price, or in any combination of cash and shares of
Common Stock, as long as the sum of the cash so paid and the Fair
Market Value of the shares of Common Stock so surrendered equals
the Purchase Price;
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(iii)
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by cancellation of indebtedness owed
by the Company to the Grantee;
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(iv)
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subject to Section 17(e), by a
loan or extension of credit from the Company evidenced by a full
recourse promissory note executed by the Grantee. The
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AMR #126358-v7
interest rate and other terms and
conditions of such note shall be determined by the Committee (in
which case the Committee may require that the Grantee pledge his or
her Shares to the Company for the purpose of securing the payment
of such note, and in no event shall the stock certificate(s)
representing such Shares be released to the Grantee until such note
shall have been paid in full); or
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(v)
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by any combination of such methods
of payment or any other method acceptable to the Committee in its
discretion.
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Except in the case of Options
exercised by certified or bank cashier's check, the Committee may
impose such limitations and prohibitions on the exercise of Options
as it deems appropriate, including, without limitation, any
limitation or prohibition designed to avoid accounting consequences
which may result from the use of Common Stock as payment upon
exercise of an Option. Any fractional shares of Common Stock
resulting from a Grantee's election that are accepted by the
Company shall in the discretion of the Committee be paid in
cash.
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(c)
Term and Nontransferability of Grants and Options.
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(i)
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Each Option under this
Section 7 shall state the time or times which all or part
thereof becomes exercisable, subject to the following
restrictions.
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(ii)
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No Option shall be exercisable
except by the Grantee or a transferee permitted
hereunder.
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(iii)
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No Option shall be assignable or
transferable, except by will or the laws of descent and
distribution of the state wherein the Grantee is domiciled at the
time of his death; provided , however , that the
Committee may (but need not) permit other transfers, where the
Committee concludes that such transferability (i) does not
result in accelerated taxation, (ii) does not cause any Option
intended to be an Incentive Stock Option to fail to be described in
Section 422(b) of the Code and (iii) is otherwise
appropriate and desirable.
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(iv)
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No Option shall be exercisable until
such time as set forth in the applicable Award Agreement (but in no
event after the expiration of such Grant).
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(v)
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The Committee may not modify, extend
or renew any Option granted to any Eligible Person unless such
modification, extension or renewal shall satisfy any and all
applicable requirements of Rule 16b-3 under the Exchange Act
and Section 409A of the Code, to the extent applicable. The
foregoing notwithstanding, no modification of an Option shall,
without the consent of the Optionee, alter or impair any rights or
obligations under any Option previously granted.
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(d)
Termination of Service, Except by
Death, Retirement or Disability. Unless otherwise provided in the
applicable Award Agreement, upon any Termination of Service for any
reason other than his or her death, Retirement or Disability, an
Optionee shall have the right, subject to the restrictions of
Section 4(c) above, to exercise his or her Option at any time
within three months after Termination of Service, but only to the
extent that, at the date of Termination of Service, the Optionee's
right to exercise such Option had accrued pursuant to the terms of
the applicable Award Agreement and had not previously been
exercised; provided , however , that, unless
otherwise provided in the applicable Award Agreement, if there
occurs a Termination of Service by a Participating Company for
Cause or a Termination of Service
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AMR #126358-v7
by the Optionee (other than on
account of death, Retirement or Disability), any Option not
exercised in full prior to such termination shall be
canceled.
(e)
Death of Optionee. Unless otherwise
provided in the applicable Award Agreement, if the Optionee of an
Option dies while an Eligible Person or within three months after
any Termination of Service other than for Cause or a Termination of
Service by the Optionee (other than on account of death, Retirement
or Disability), and has not fully exercised the Option, then the
Option may be exercised in full, subject to the restrictions of
Section 4(c) above, at anytime within 12 months after the
Optionee's death, by the Successor of the Optionee, but only to the
extent that, at the date of death, the Optionee's right to exercise
such Option had accrued and had not been forfeited pursuant to the
terms of the Award Agreement and had not previously been
exercised.
(f)
Disability or Retirement of
Optionee. Unless otherwise provided in the Award Agreement, upon
any Termination of Service for reason of his or her Disability or
Retirement, an Optionee shall have the right, subject to the
restrictions of Section 4(c) above, to exercise the Option at
any time within 24 months after Termination of Service, but only to
the extent that, at the date of Termination of Service, the
Optionee's right to exercise such Option had accrued pursuant to
the terms of the applicable Award Agreement and had not previously
been exercised.
(g)
Rights as a Stockholder. An
Optionee, a Successor of the Optionee, or the holder of a DER shall
have no rights as a stockholder with respect to any Shares covered
by his or her Grant until, in the case of an Optionee, the date of
the issuance of a stock certificate for such Shares. No adjustment
shall be made for dividends (ordinary or extraordinary, whether in
cash, securities or other property), distributions or other rights
for which the record date is prior to the date such stock
certificate is issued, except as provided in
Section 15.
(h)
Modification, Extension and Renewal
of Option. Within the limitations of the Plan, and only with
respect to Options granted to Eligible Persons, the Committee may
modify, extend or renew outstanding Options or accept the
cancellation of outstanding Options (to the extent not previously
exercised) for the granting of new Options in substitution therefor
(but not including repricings, in the absence of stockholder
approval). The Committee may modify, extend or
