RINO INTERNATIONAL
CORPORATION
2009 STOCK INCENTIVE
PLAN
ARTICLE I
PURPOSE
The purpose of this Plan is to enhance the
profitability and value of the Company for the benefit of its
stockholders by enabling the Company to offer Eligible Employees,
Consultants and Non-Employee Directors cash and stock-based
incentives in the Company to attract, retain and reward such
individuals and strengthen the mutuality of interests between such
individuals and the Company’s stockholders.
ARTICLE II
DEFINITIONS
For purposes of this Plan, the following terms
shall have the following meanings:
2.1
“ Acquisition Event ” means a merger or
consolidation in which the Company is not the surviving entity, any
transaction that results in the acquisition of all or substantially
all of the Company’s outstanding Common Stock by a single
person or entity or by a group of persons and/or entities acting in
concert, or the sale or transfer of all or substantially all of the
Company’s assets.
2.2
“ Affiliate ” means each of the
following: (a) any Subsidiary; (b) any Parent; (c) any
corporation, trade or business (including, without limitation, a
partnership or limited liability company) which is directly or
indirectly controlled 50% or more (whether by ownership of stock,
assets or an equivalent ownership interest or voting interest) by
the Company; (d) any corporation, trade or business (including,
without limitation, a partnership or limited liability company)
which directly or indirectly controls 50% or more (whether by
ownership of stock, assets or an equivalent ownership interest or
voting interest) of the Company; and (e) any other entity in
which the Company or any of its Affiliates has a material equity
interest and which is designated as an “Affiliate” by
resolution of the Committee; provided that the Common Stock subject
to any Award constitutes “service recipient stock” for
purposes of Section 409A of the Code or otherwise does not subject
the Award to Section 409A of the Code. For purposes of this Plan,
Dalian RINO Environment Engineering Science and Technology Co.,
Ltd., and its current and future Affiliate, shall each be deemed an
“Affiliate” of the Company.
2.3
“ Appreciation
Award ” means any Award under this Plan of any Stock
Option, Stock Appreciation Right or Other Stock-Based Award,
provided that such Other Stock-Based Award is based on the
appreciation in value of a share of Common Stock in excess of an
amount equal to at least the Fair Market Value of the Common Stock
on the date such Other Stock-Based Award is granted.
2.4
“ Award ” means any award under this Plan
of any Stock Option, Stock Appreciation Right, Restricted Stock,
Performance Share, Other Stock-Based Award or Performance-Based
Cash Awards. All Awards shall be granted by, confirmed by, and
subject to the terms of, a written agreement executed by the
Company and the Participant.
2.5
“ Board ” means the Board of Directors of
the Company.
2.6
“ Cause ” means with respect to a
Participant’s Termination of Employment or Termination of
Consultancy from and after the date hereof, the following: (a) in
the case where there is no employment agreement, consulting
agreement, change in control agreement or similar agreement in
effect between the Company or an Affiliate and the Participant at
the time of the grant of the Award (or where there is such an
agreement but it does not define “cause” (or words of
like import)), termination due to: (i) a Participant’s
conviction of, or plea of guilty or nolo contendere to, a felony;
(ii) perpetration by a Participant of an illegal act, or fraud
which could cause significant economic injury to the Company; (iii)
continuing willful and deliberate failure by the Participant to
perform the Participant’s duties in any material respect,
provided that the Participant is given notice and an opportunity to
effectuate a cure as determined by the Committee; or (iv) a
Participant’s willful misconduct with regard to the Company
that could have a material adverse effect on the Company; or (b) in
the case where there is an employment agreement, consulting
agreement, change in control agreement or similar agreement in
effect between the Company or an Affiliate and the Participant at
the time of the grant of the Award that defines “cause”
(or words of like import), “cause” as defined under
such agreement; provided, however, that with regard to any
agreement under which the definition of “cause” only
applies on occurrence of a change in control, such definition of
“cause” shall not apply until a change in control
actually takes place and then only with regard to a termination
thereafter. With respect to a Participant’s Termination of
Directorship, “cause” means an act or failure to act
that constitutes cause for removal of a director under applicable
Nevada law.
2.7
“ Change in Control ” has the meaning set
forth in Section 13.2.
2.8
“ Change in Control Price ” has the
meaning set forth in Section 13.1.
2.9
“ Code ” means the Internal Revenue Code
of 1986, as amended. Any reference to any section of the Code shall
also be a reference to any successor provision and any Treasury
Regulation promulgated thereunder.
2.10 “
Committee ” means: (a) with respect to the
application of this Plan to Eligible Employees and Consultants, a
committee or subcommittee of the Board appointed from time to time
by the Board, which committee or subcommittee shall consist of two
or more non-employee directors, each of whom shall be (i) a
“non-employee director” as defined in Rule 16b-3; (ii)
to the extent required by Section 162(m) of the Code, an
“outside director” as defined under Section 162(m) of
the Code; and (iii) an “independent director” for
purposes of the applicable stock exchange rules; and (b) with
respect to the application of this Plan to Non-Employee Directors,
the Board. To the extent that no Committee exists that has the
authority to administer this Plan, the functions of the Committee
shall be exercised by the Board. If for any reason the appointed
Committee does not meet the requirements of Rule 16b-3 or Section
162(m) of the Code, such noncompliance shall not affect the
validity of Awards, grants, interpretations or other actions of the
Committee.
2.11 “
Common Stock ” means the common stock, $0.0001 par
value per share, of the Company.
2.12 “
Company ” means RINO International Corporation, a
Nevada corporation, and its successors by operation of
law.
2.13 “
Consultant ” means any individual or entity who
provides bona fide consulting or advisory services to the Company
or its Affiliates pursuant to a written agreement, which are not in
connection with the offer and sale of securities in a
capital-raising transaction.
2.14
“ Disability
” means with respect to a Participant’s
Termination, a permanent and total disability as defined in Section
22(e)(3) of the Code. A Disability shall only be deemed to occur at
the time of the determination by the Committee of the Disability.
Notwithstanding the foregoing, for Awards that are subject to
Section 409A of the Code, Disability shall mean that a Participant
is disabled under Section 409A(a)(2)(C)(i) or (ii) of the
Code.
2.15
“ Effective
Date ” means the effective date of this Plan as
defined in Article XVII.
2.16
“ Eligible
Employees ” means each employee of the Company or an
Affiliate.
2.17
“ Exchange
Act ” means the Securities Exchange Act of 1934, as
amended. Any references to any section of the Exchange Act shall
also be a reference to any successor provision.
2.18 “
Fair Market Value ” means, unless otherwise
required by any applicable provision of the Code or any regulations
issued thereunder, as of any date and except as provided below, the
last sales price reported for the Common Stock on the applicable
date: (a) as reported on the principal national securities exchange
in the United States on which it is then traded, or (b) if the
Common Stock is not traded, listed or otherwise reported or quoted,
the Committee shall determine in good faith the Fair Market Value
in whatever manner it considers appropriate taking into account the
requirements of Section 409A of the Code. For purposes of the grant
of any Award, the applicable date shall be the trading day
immediately prior to the date on which the Award is granted. For
purposes of the exercise of any Award, the applicable date shall be
the date a notice of exercise is received by the Committee or, if
not a day on which the applicable market is open, the next day that
it is open.
2.19
“ Family
Member ” means “family member” as defined
in Section A.1.(5) of the general instructions of Form
S-8.
2.20 “
GAAP ” has the meaning set forth in Section
11.2(c)(ii).
2.21
“ Incentive Stock
Option ” means any Stock Option awarded to an
Eligible Employee of the Company, its Subsidiaries and its Parent
(if any) under this Plan intended to be and designated as an
“Incentive Stock Option” within the meaning of Section
422 of the Code.
2.22
“ Non-Employee
Director ” means a director of the Company who is not
an active employee of the Company or an Affiliate.
2.23
“ Non-Qualified
Stock Option ” means any Stock Option awarded under
this Plan that is not an Incentive Stock Option.
2.24
“ Other
Stock-Based Award ” means an Award under Article X of
this Plan that is valued in whole or in part by reference to, or is
payable in or otherwise based on, Common Stock, including, without
limitation, a restricted stock unit or an Award valued by reference
to an Affiliate.
2.25
“ Parent
” means any parent corporation of the Company within the
meaning of Section 424(e) of the Code.
2.26 “
Participant ” means an Eligible Employee,
Non-Employee Director or Consultant to whom an Award has been
granted pursuant to this Plan.
2.27
“ Performance Goals
” means, for purposes of the grant or vesting of Awards
of Restricted Stock, Other Stock-Based Awards, Performance Shares
and/or Performance-Based Cash Awards, each intended to be
“performance-based” under Section 162(m) of the Code,
shall be based on the attainment of certain target levels of, or a
specified increase or decrease (as applicable) of the performance
goals established by the Committee.
2.28 “
Performance-Based Cash Award ” means a cash Award under Article XI of this Plan
that is payable or otherwise based on the attainment of certain
pre-established performance goals during a Performance
Period.
2.29 “
Performance Period ” means the duration of the
period during which receipt of an Award is subject to the
satisfaction of performance criteria, such period as determined by
the Committee in its sole discretion.
2.30 “
Performance Share ” means an Award made pursuant
to Article IX of this Plan of the right to receive Common Stock or
cash of an equivalent value at the end of a specified Performance
Period.
2.31
“ Person
” means any individual, corporation, partnership, limited
liability company, firm, joint venture, association, joint-stock
company, trust, incorporated organization, governmental or
regulatory or other entity.
2.32
“ Plan
” means this RINO International Corporation 2009 Stock
Incentive Plan, as amended from time to time.
2.33
“ Reference Stock
Option ” has the meaning set forth in Section
7.1.
2.34
“ Restricted
Stock ” means an Award of shares of Common Stock
under this Plan that is subject to restrictions under Article
VIII.
2.35
“ Restriction
Period ” has the meaning set forth in Subsection
8.3(a).
2.36 “
Rule 16b-3 ” means Rule 16b-3 under Section 16(b)
of the Exchange Act as then in effect or any successor
provision.
2.37 “
Section 162(m) of the Code ” means the exception
for performance-based compensation under Section 162(m) of the Code
and any applicable Treasury regulations thereunder.
2.38
“ Section 409A of
the Code ” means the nonqualified deferred
compensation rules under Section 409A of the Code and any
applicable Treasury regulations thereunder.
2.39 “
Securities Act ” means the Securities Act of 1933,
as amended and all rules and regulations promulgated thereunder.
Any reference to any section of the Securities Act shall also be a
reference to any successor provision.
2.40 “
Stock Appreciation Right ” means the right
pursuant to an Award granted under Article VII. A Tandem Stock
Appreciation Right shall mean the right to surrender to the Company
all (or a portion) of a Stock Option in exchange for cash or a
number of shares of Common Stock (as determined by the Committee,
in its sole discretion, on the date of grant) equal to the
difference between (a) the Fair Market Value on the date such
Stock Option (or such portion thereof) is surrendered, of the
Common Stock covered by such Stock Option (or such portion
thereof), and (b) the aggregate exercise price of such Stock
Option (or such portion thereof). A Non-Tandem Stock Appreciation
Right shall mean the right to receive cash or a number of shares of
Common Stock (as determined by the Committee, in its sole
discretion, on the date of grant) equal to the difference between
(i) the Fair Market Value of a share of Common Stock on the
date such right is exercised, and (ii) the aggregate exercise
price of such right, otherwise than on surrender of a Stock
Option.
2.41
“ Stock
Option ” or “ Option ”
means any option to purchase shares of Common Stock granted to
Eligible Employees, Non-Employee Directors or Consultants granted
pursuant to Article VI.
2.42 “
Subsidiary ” means any subsidiary corporation of
the Company within the meaning of Section 424(f) of the
Code.
2.43 “
Ten Percent Stockholder ” means a person owning
stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company, its Subsidiaries or its
Parent.
2.44 “
Termination ” means a Termination of Consultancy,
Termination of Directorship or Termination of Employment, as
applicable.
2.45 “
Termination of Consultancy ” means: (a) that the
Consultant is no longer acting as a consultant to the Company or an
Affiliate; or (b) when an entity which is retaining a Participant
as a Consultant ceases to be an Affiliate unless the Participant
otherwise is, or thereupon becomes, a Consultant to the Company or
another Affiliate at the time the entity ceases to be an Affiliate.
In the event that a Consultant becomes an Eligible Employee or a
Non-Employee Director upon the termination of his or her
consultancy, unless otherwise determined by the Committee, in its
sole discretion, no Termination of Consultancy shall be deemed to
occur until such time as such Consultant is no longer a Consultant,
an Eligible Employee or a Non-Employee Director. Notwithstanding
the foregoing, the Committee may, in its sole discretion, otherwise
define Termination of Consultancy in the Award agreement or, if no
rights of a Participant are reduced, may otherwise define
Termination of Consultancy thereafter.
2.46
“ Termination of
Directorship ” means that the Non-Employee Director
has ceased to be a director of the Company; except that if a
Non-Employee Director becomes an Eligible Employee or a Consultant
upon the termination of his or her directorship, his or her ceasing
to be a director of the Company shall not be treated as a
Termination of Directorship unless and until the Participant has a
Termination of Employment or Termination of Consultancy, as the
case may be.
2.47 “
Termination of Employment ” means: (a) a
termination of employment (for reasons other than a military or
personal leave of absence granted by the Company) of a Participant
from the Company and its Affiliates; or (b) when an entity
which is employing a Participant ceases to be an Affiliate, unless
the Participant otherwise is, or thereupon becomes, employed by the
Company or another Affiliate at the time the entity ceases to be an
Affiliate. In the event that an Eligible Employee becomes a
Consultant or a Non-Employee Director upon the termination of his
or her employment, unless otherwise determined by the Committee, in
its sole discretion, no Termination of Employment shall be deemed
to occur until such time as such Eligible Employee is no longer an
Eligible Employee, a Consultant or a Non-Employee Director.
Notwithstanding the foregoing, the Committee may, in its sole
discretion, otherwise define Termination of Employment in the Award
agreement or, if no rights of a Participant are reduced, may
otherwise define Termination of Employment thereafter.
2.48 “
Transfer ” means: (a) when used as a noun, any
direct or indirect transfer, sale, assignment, pledge,
hypothecation, encumbrance or other disposition (including the
issuance of equity in a Person), whether for value or no value and
whether voluntary or involuntary (including by operation of law),
and (b) when used as a verb, to directly or indirectly transfer,
sell, assign, pledge, encumber, charge, hypothecate or otherwise
dispose of (including the issuance of equity in a Person) whether
for value or for no value and whether voluntarily or involuntarily
(including by operation of law). “Transferred” and
“Transferrable” shall have a correlative
meaning.
ARTICLE III
ADMINISTRATION
3.1
The Committee . The Plan shall be administered
and interpreted by the Committee.
3.2
Grants of Awards . The Committee shall have full
authority to grant, pursuant to the terms of this Plan, to Eligible
Employees, Consultants and Non-Employee Directors: (i) Stock
Options, (ii) Stock Appreciation Rights, (iii) Restricted
Stock, (iv) Performance Shares; (v) Other Stock-Based
Awards, and (vi) Performance-Based Cash Awards. In particular, the
Committee shall have the authority:
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(a)
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to select the
Eligible Employees, Consultants and Non-Employee Directors to whom
Awards may from time to time be granted hereunder;
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(b)
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to determine
whether and to what extent Awards, or any combination thereof, are
to be granted hereunder to one or more Eligible Employees,
Consultants or Non-Employee Directors;
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(c)
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to determine
the number of shares of Common Stock to be covered by each Award
granted hereunder;
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(d)
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to determine
the terms and conditions, not inconsistent with the terms of this
Plan, of any Award granted hereunder (including, but not limited
to, the exercise or purchase price (if any), any restriction or
limitation, any vesting schedule or acceleration thereof, or any
forfeiture restrictions or waiver thereof, regarding any Award and
the shares of Common Stock relating thereto, based on such factors,
if any, as the Committee shall determine, in its sole
discretion);
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(e)
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to determine
whether, to what extent and under what circumstances grants of
Options and other Awards under this Plan are to operate on a tandem
basis and/or in conjunction with or apart from other awards made by
the Company outside of this Plan;
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(f)
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to determine
whether and under what circumstances a Stock Option may be settled
in cash, Common Stock and/or Restricted Stock under
Section 6.3(d);
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(g)
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to determine
whether, to what extent and under what circumstances Common Stock
and other amounts payable with respect to an Award under this Plan
shall be deferred either automatically or at the election of the
Participant in any case, subject to, and in accordance with,
Section 409A of the Code;
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(h)
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to determine
whether a Stock Option is an Incentive Stock Option or
Non-Qualified Stock Option; and
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(i)
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to determine
whether to require a Participant, as a condition of the granting of
any Award, to not sell or otherwise dispose of shares acquired
pursuant to the exercise of an Award for a period of time as
determined by the Committee, in its sole discretion, following the
date of the acquisition of such Award.
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3.3
Guidelines . Subject to Article XIV hereof, the
Committee shall, in its sole discretion, have the authority to
adopt, alter and repeal such administrative rules, guidelines and
practices governing this Plan and perform all acts, including the
delegation of its responsibilities (to the extent permitted by
applicable law and applicable stock exchange rules), as it shall,
from time to time, deem advisable; to construe and interpret the
terms and provisions of this Plan and any Award issued under this
Plan (and any agreements relating thereto); and to otherwise
supervise the administration of this Plan. The Committee may, in
its sole discretion, correct any defect, supply any omission or
reconcile any inconsistency in this Plan or in any agreement
relating thereto in the manner and to the extent it shall deem
necessary to effectuate the purpose and intent of this Plan. The
Committee may, in its sole discretion, adopt special guidelines and
provisions for persons who are residing in or employed in, or
subject to, the taxes of, any domestic or foreign jurisdictions to
comply with applicable tax and securities laws of such domestic or
foreign jurisdictions. This Plan is intended to comply with the
applicable requirements of Rule 16b-3 and with respect to Awards
intended to be “performance-based,” the applicable
provisions of Section 162(m) of the Code, and this Plan shall be
limited, construed and interpreted in a manner so as to comply
therewith.
3.4
Decisions Final . Any decision, interpretation or
other action made or taken in good faith by or at the direction of
the Company, the Board or the Committee (or any of its members)
arising out of or in connection with this Plan shall be within the
absolute discretion of all and each of them, as the case may be,
and shall be final, binding and conclusive on the Company and all
employees and Participants and their respective heirs, executors,
administrators, successors and assigns.
3.5
Procedures . If
the Committee is appointed, the Board shall designate one of the
members of the Committee as chairman and the Committee shall hold
meetings, subject to the By-Laws of the Company, at such times and
places as it shall deem advisable, including, without limitation,
by telephone conference or by written consent to the extent
permitted by applicable law. A majority of the Committee members
shall constitute a quorum. All determinations of the Committee
shall be made by a majority of its members. Any decision or
determination reduced to writing and signed by all the Committee
members in accordance with the By-Laws of the Company shall be
fully effective as if it had been made by a vote at a meeting duly
called and held. The Committee shall keep minutes of its meetings
and shall make such rules and regulations for the conduct of its
business as it shall deem advisable.
3.6
Designation of Consultants/Liability .
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(a)
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The Committee
may, in its sole discretion, designate employees of the Company and
professional advisors to assist the Committee in the administration
of this Plan and (to the extent permitted by applicable law and
applicable exchange rules) may grant authority to officers to grant
Awards and/or execute agreements or other documents on behalf of
the Committee.
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(b)
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The Committee
may, in its sole discretion, employ such legal counsel, consultants
and agents as it may deem desirable for the administration of this
Plan and may rely upon any opinion received from any such counsel
or consultant and any computation received from any such consultant
or agent. Expenses incurred by the Committee or the Board in the
engagement of any such counsel, consultant or agent shall be paid
by the Company. The Committee, its members and any person
designated pursuant to sub-section (a) above shall not be liable
for any action or determination made in good faith with respect to
this Plan. To the maximum extent permitted by applicable law, no
officer of the Company or member or former member of the Committee
or of the Board shall be liable for any action or determination
made in good faith with respect to this Plan or any Award granted
under it.
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3.7
Indemnification . To the maximum extent permitted by
applicable law and the Certificate of Incorporation and By-Laws of
the Company and to the extent not covered by insurance directly
insuring such person, each officer or employee of the Company or
any Affiliate and member or former member of the Committee or the
Board shall be indemnified and held harmless by the Company against
any cost or expense (including reasonable fees of counsel
reasonably acceptable to the Committee) or liability (including any
sum paid in settlement of a claim with the approval of the
Committee), and advanced amounts necessary to pay the foregoing at
the earliest time and to the fullest extent permitted, arising out
of any act or omission to act in connection with the administration
of this Plan, except to the extent arising out of such
officer’s, employee’s, member’s or former
member’s fraud. Such indemnification shall be in addition to
any rights of indemnification the officers, employees, directors or
members or former officers, directors or members may have under
applicable law or under the Certificate of Incorporation or By-Laws
of the Company or any Affiliate. Notwithstanding anything else
herein, this indemnification will not apply to the actions or
determinations made by an individual with regard to Awards granted
to him or her under this Plan.
ARTICLE IV
SHARE LIMITATION
4.1
Shares .
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(a)
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General
Limitations . The
aggregate number of shares of Common Stock that may be issued or
used for reference purposes or with respect to which Awards may be
granted under this Plan shall not exceed 2,500,000 shares (subject
to any increase or decrease pursuant to Section 4.2), which may be
either authorized and unissued Common Stock or Common Stock held in
or acquired for the treasury of the Company or both;
provided , however , that such number shall be
increased at the end of each fiscal year of the Company in the same
proportion as the issued and outstanding stock of the Company
during such fiscal year; subject to a maximum of 10%
of the issued and outstanding stock of the Company. If any Award
granted under this Plan expires, terminates, is canceled or is
forfeited for any reason, the number of shares of Common Stock
underlying any such Award shall again be available for the purpose
of Awards under the Plan, as provided in this Section 4.1(a). If a
Tandem Stock Appreciation Right or a Limited Stock Appreciation
Right is granted in tandem with an Option, such grant shall only
apply once against the maximum number of shares of Common Stock
which may be issued under this Plan. Notwithstanding anything
herein to the contrary, other than with respect to Incentive Stock
Options, any share of Common Stock subject to an Award that again
becomes available for grant pursuant to this Section 4.1(a) shall
be added back to the aggregate maximum limit.
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(b)
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Individual
Participant Limitations .
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(i)
The maximum number of shares of Common Stock subject to any Award
of Stock Options, Stock Appreciation Rights or shares of Restricted
Stock for which the grant of such Award or the lapse of the
relevant Restriction Period is subject to the attainment of
Performance Goals in accordance with Section 8.3(a)(ii) herein
which may be granted under this Plan during any fiscal year of the
Company to each Eligible Employee or Consultant shall be such
number of shares per type of Award (which shall be subject to any
further increase or decrease pursuant to Section 4.2) as determined
by the Committee, provided that the maximum number of shares of
Common Stock for all types of Awards does not exceed such number of
shares as determined by the Committee (which shall be subject to
any further increase or decrease pursuant to Section 4.2) with
respect to any fiscal year of the Company. If a Tandem Stock
Appreciation Right is granted or a Limited Stock Appreciation Right
is granted in tandem with a Stock Option, it shall apply against
the Eligible Employee's or Consultant's individual share
limitations for both Stock Appreciation Rights and Stock
Options.
(ii)
The maximum number of shares of Common Stock subject to any
Award of Stock Options (other than Incentive Stock Options), Stock
Appreciation Rights, Performance Shares or Other Stock-Based Awards
which may be granted under this Plan during any fiscal year of the
Company to each Non-Employee Director shall be such number of
shares per type of Award (which shall be subject to any further
increase or decrease pursuant to Section 4.2) as determined by the
Committee, provided that the maximum number of shares of Common
Stock for all types of Awards does not exceed such number of shares
as determined by the Committee (which shall be subject to any
further increase or decrease pursuant to Section 4.2) with respect
to any fiscal year of the Company. If a Tandem Stock Appreciation
Right is granted or a Limited Stock Appreciation Right is granted
in tandem with a Stock Option, it shall apply against the
Non-Employee Director's individual share limitations for both Stock
Appreciation Rights and Stock Options.
(iii)
There are no annual individual Eligible Employee or Consultant
share limitations on Restricted Stock for which the grant of such
Award or the lapse of the relevant Restriction Period is not
subject to attainment of Performance Goals in accordance with
Section 8.3(a)(ii) hereof.
(iv)
The maximum number of shares of Common Stock subject to any Award
of Performance Shares which may be granted under this Plan during
any fiscal year of the Company to each Eligible Employee or
Consultant shall be such number of shares (which shall be subject
to any further increase or decrease pursuant to Section 4.2) as
determined by the Committee with respect to any fiscal year of the
Company. Each Performance Share shall be referenced to one share of
Common Stock and shall be charged against the available shares
under this Plan at the time the unit value measurement is converted
to a referenced number of shares of Common Stock in accordance with
Section 9.1.
(v)
The maximum payment under any Performance-Based Cash Award payable
with respect to any fiscal year of the Company and for which the
grant of such Award is subject to the attainment of Performance
Goals in accordance with Section 11.2(c) herein which may be
granted under this Plan with respect to any fiscal year of the
Company to each Eligible Employee or Consultant shall be as
determined by the Committee.
(vi)
The individual Participant limitations set forth in this Section
4.1(b) shall be cumulative; that is, to the extent that shares of
Common Stock for which Awards are permitted to be granted to an
Eligible Employee or a Consultant during a fiscal year are not
covered by an Award to such Eligible Employee or Consultant in a
fiscal year, the number of shares of Common Stock available for
Awards to such Eligible Employee or Consultant shall automatically
increase in the subsequent fiscal years during the term of the Plan
until used.
4.2
Changes .
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(a)
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The existence
of this Plan and the Awards granted hereunder shall not affect in
any way the right or power of the Board or the stockholders of the
Company to make or authorize (i) any adjustment, recapitalization,
reorganization or other change in the Company’s capital
structure or its business, (ii) any merger or consolidation of the
Company or any Affiliate, (iii) any issuance of bonds, debentures,
preferred or prior preference stock ahead of or affecting the
Common Stock, (iv) the dissolution or liquidation of the Company or
any Affiliate, (v) any sale or transfer of all or part of the
assets or business of the Company or any Affiliate or (vi) any
other corporate act or proceeding.
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(b)
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Subject to the
provisions of Section 4.2(d), if there shall occur any such change
in the capital structure of the Company by reason of any stock
split, reverse stock split, stock dividend, subdivision,
combination or reclassification of shares that may be issued under
the Plan, any recapitalization, any merger, any consolidation, any
spin off, any reorganization or any partial or complete
liquidation, or any other corporate transaction or event having an
effect similar to any of the foregoing (a “ Section 4.2
Event ”), then (i) the aggregate number and/or kind of
shares that thereafter may be issued under the Plan, (ii) the
number and/or kind of shares or other property (including cash) to
be issued upon exercise of an outstanding Award or under other
Awards granted under the Plan, (iii) the purchase price thereof,
and/or (iv) the individual Participant limitations set forth in
Section 4.1(b) (other than those based on cash limitations) shall
be appropriately adjusted. In addition, subject to Section 4.2(d),
if there shall occur any change in the capital structure or the
business of the Company that is not a Section 4.2 Event (an “
Other Extraordinary Event ”), including by reason of
any extraordinary dividend (whether cash or stock), any conversion,
any adjustment, any issuance of any class of securities convertible
or exercisable into, or exercisable for, any class of stock, or any
sale or transfer of all or substantially all the Company’s
assets or business, then the Committee, in its sole discretion, may
adjust any Award and make such other adjustments to the Plan. Any
adjustment pursuant to this Section 4.2 shall be consistent with
the applicable Section 4.2 Event or the applicable Other
Extraordinary Event, as the case may be, and in such manner as the
Committee may, in its sole discretion, deem appropriate and
equitable to prevent substantial dilution or enlargement of the
rights granted to, or available for, Participants under the Plan.
Any such adjustment determined by the Committee shall be final,
binding and conclusive on the Company and all Participants and
their respective heirs, executors, administrators, successors and
permitted assigns. Except as expressly provided in this Section 4.2
or in the applicable Award agreement, a Participant shall have no
rights by reason of any Section 4.2 Event or any Other
Extraordinary Event.
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(c)
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Fractional
shares of Common Stock resulting from any adjustment in Awards
pursuant to Section 4.2(a) or (b) shall be aggregated until, and
eliminated at, the time of exercise by rounding-down for fractions
less than one-half and rounding-up for fractions equal to or
greater than one-half. No cash settlements shall be made with
respect to fractional shares eliminated by rounding. Notice of any
adjustment shall be given by the Committee to each Participant
whose Award has been adjusted and such adjustment (whether or not
such notice is given) shall be effective and binding for all
purposes of this Plan.
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(d)
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In the event of
an Acquisition Event, the Committee may, in its sole discretion,
terminate all outstanding and unexercised Stock Options or Stock
Appreciation Rights or any Other Stock Based Award that provides
for a Participant elected exercise effective as of the date of the
Acquisition Event, by delivering notice of termination to each
Participant at least 20 days prior to the date of consummation of
the Acquisition Event, in which case during the period from the
date on which such notice of termination is delivered to the
consummation of the Acquisition Event, each such Participant shall
have the right to exercise in full all of his or her Stock Options
or Stock Appreciation Rights that are then outstanding (without
regard to any limitations on exercisability otherwise contained in
the Award agreements), but any such exercise shall be contingent on
the occurrence of the Acquisition Event, and, provided that, if the
Acquisition Event does not take place within a specified period
after giving such notice for any reason whatsoever, the notice and
exercise pursuant thereto shall be null and void.
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If an
Acquisition Event occurs but the Committee does not terminate the
outstanding Awards pursuant to this Section 4.2(d), then the
provisions of Section 4.2(b) and Article XIII shall
apply.
4.3
Minimum Purchase Price . Notwithstanding any
provision of this Plan to the contrary, if authorized but
previously unissued shares of Common Stock are issued under this
Plan, such shares shall not be issued for a consideration that is
less than as permitted under applicable law.
ARTICLE V
ELIGIBILITY – GENERAL
REQUIREMENTS FOR AWARDS
5.1
General Eligibility . All Eligible Employees,
Consultants, Non-Employee Directors and prospective employees and
consultants are eligible to be granted Awards, subject to the terms
and conditions of this Plan. Eligibility for the grant of Awards
and actual participation in this Plan shall be determined by the
Committee in its sole discretion.
5.2
Incentive Stock
Options . Notwithstanding anything herein to the contrary,
only Eligible Employees of the Company, its Subsidiaries and its
Parent (if any) are eligible to be granted Incentive Stock Options
under this Plan. Eligibility for the grant of an Incentive Stock
Option and actual participation in this Plan shall be determined by
the Committee in its sole discretion.
5.3
General Requirement . The vesting and exercise of
Awards granted to a prospective employee, consultant or
non-employee director are conditioned upon such individual actually
becoming an Eligible Employee or Consultant, or Non-Employee
Director.
5.4
Minimum Vesting Requirement . Except as determined by
the Committee as evidenced in writing by an Award, no Award granted
hereunder shall vest and become exercisable prior to the first year
anniversary of the date that the Award was granted; provided,
however, that the foregoing minimum vesting requirement shall not
apply in the case of the death or Disability of a Participant or
upon the occurrence of a Change in Control.
ARTICLE VI
STOCK OPTIONS
6.1
Options . Stock Options may be granted alone or in
addition to other Awards granted under this Plan. Each Stock Option
granted under this Plan shall be of one of two types: (a) an
Incentive Stock Option or (b) a Non-Qualified Stock
Option.
6.2
Grants . The Committee shall, in its sole discretion,
have the authority to grant to any Eligible Employee (subject to
Section 5.2) Incentive Stock Options, Non-Qualified Stock Options,
or both types of Stock Options. The Committee shall, in its sole
discretion, have the authority to grant any Consultant or
Non-Employee Director Non-Qualified Stock Options. To the extent
that any Stock Option does not qualify as an Incentive Stock Option
(whether because of its provisions or the time or manner of its
exercise or otherwise), such Stock Option or the portion thereof
which does not qualify shall constitute a separate Non-Qualified
Stock Option.
6.3
Terms of Options . Options granted under this Plan
shall be subject to the following terms and conditions and shall be
in such form and contain such additional terms and conditions, not
inconsistent with the terms of this Plan, as the Committee, in its
sole discretion, shall deem desirable:
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(a)
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Exercise
Price . The exercise
price per share of Common Stock subject to a Stock Option shall be
determined by the Committee at the time of grant, provided that the
per share exercise price of a Stock Option shall not be less than
100% (or, in the case of an Incentive Stock Option granted to a Ten
Percent Stockholder, 110%) of the Fair Market Value of the Common
Stock at the time of grant.
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(b)
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Stock Option
Term . The term of each
Stock Option shall be fixed by the Committee, provided that no
Stock Option shall be exercisable more than 10 years after the date
the Option is granted; and provided further that the term of an
Incentive Stock Option granted to a Ten Percent Stockholder shall
not exceed five years.
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(c)
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Exercisability . Stock Options shall be exercisable at such
time or times and subject to such terms and conditions or as shall
be determined by the Committee at grant. If the Committee provides,
in its sole discretion, that any Stock Option is exercisable
subject to certain limitations (including, without limitation, that
such Stock Option is exercisable only in installments or within
certain time periods), the Committee may waive such limitations on
the exercisability at any time at or after grant in whole or in
part (including, without limitation, waiver of the installment
exercise provisions or acceleration of the time at which such Stock
Option may be exercised), based on such factors, if any, as the
Committee shall determine, in its sole discretion. In the event
that a written employment agreement between the Company and a
Participant provides for a vesting schedule that is more favorable
than the vesting schedule provided in the form of Award agreement,
the vesting schedule in such employment agreement shall govern,
provided that such agreement is in effect on the date of grant and
applicable to the specific Award.
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(d)
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Method of
Exercise . Subject to
whatever installment exercise and waiting period provisions
applicable under subsection (c) above, to the extent vested, Stock
Options may be exercised in whole or in part at any time during the
Option term, by giving written notice of exercise to the Company
specifying the number of shares of Common Stock to be purchased.
Such notice shall be accompanied by payment in full of the purchase
price as follows: (i) in cash or by check, bank draft or money
order payable to the order of the Company; (ii) solely to the
extent permitted by applicable law, if the Committee authorizes,
through a procedure whereby the Participant delivers irrevocable
instructions to a broker reasonably acceptable to the Committee to
deliver promptly to the Company an amount equal to the purchase
price; or (iii) on such other terms and conditions as may be
acceptable to the Committee (including, without limitation, the
relinquishment of Stock Options or by payment in full or in part in
the form of Common Stock owned by the Participant based on the Fair
Market Value of the Common Stock on the payment date as determined
by the Committee, in its sole discretion). No shares of Common
Stock shall be issued until payment therefor, as provided herein,
has been made or provided for.
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(e)
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Non-Transferability of Options
. No Stock Option shall be
Transferable by the Participant otherwise than by will or by the
laws of descent and distribution, and all Stock Options shall be
exercisable, during the Participant’s lifetime, only by the
Participant. Notwithstanding the foregoing, the Committee may
determine, in its sole discretion, at the time of grant or
thereafter that a Non-Qualified Stock Option that is otherwise not
Transferable pursuant to this Section is Transferable to a Family
Member in whole or in part and in such circumstances, and under
such conditions, as determined by the Committee, in its sole
discretion. A Non-Qualified Stock Option that is Transferred to a
Family Member pursuant to the preceding sentence (i) may not be
subsequently Transferred otherwise than by will or by the laws of
descent and distribution and (ii) remains subject to the terms of
this Plan and the applicable Award agreement. Any shares of Common
Stock acquired upon the exercise of a Non-Qualified Stock Option by
a permissible transferee of such Non-Qualified Stock Option or a
permissible transferee pursuant to a Transfer after the exercise of
such Non-Qualified Stock Option shall be subject to the terms of
this Plan and the applicable Award agreement.
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(f)
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Incentive
Stock Option Limitations . To the extent that the aggregate Fair Market
Value (determined as of the time of grant) of the Common Stock with
respect to which Incentive Stock Options are exercisable for the
first time by an Eligible Employee during any calendar year under
this Plan and/or any other stock option plan of the Company, any
Subsidiary or any Parent exceeds $100,000, such Options shall be
treated as Non-Qualified Stock Options. Should any provision of
this Plan not be necessary in order for the Stock Options to
qualify as Incentive Stock Options, or should any additional
provisions be required, the Committee may, in its sole discretion,
amend this Plan accordingly, without the necessity of obtaining the
approval of the stockholders of the Company.
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(g)
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Form,
Modification, Extension and Renewal of Stock Options
. Subject to the terms and
conditions and within the limitations of this Plan, Stock Options
shall be evidenced by such form of agreement or grant as is
approved by the Committee, and the Committee may, in its sole
discretion (i) modify, extend or renew outstanding Stock Options
granted under this Plan (provided that the rights of a Participant
are not reduced without his or her consent and provided further
that such action does not subject the Stock Options to Section 409A
of the Code), and (ii) accept the surrender of outstanding Stock
Options (up to the extent not theretofore exercised) and authorize
the granting of new Stock Options in substitution therefor (to the
extent not theretofore exercised). Notwithstanding the foregoing,
an outstanding Option may not be modified to reduce the exercise
price thereof nor may a new Option at a lower price be substituted
for a surrendered Option (other than adjustments or substitutions
in accordance with Section 4.2), unless such action is approved by
the stockholders of the Company.
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(h)
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Early
Exercise . The Committee
may provide that a Stock Option include a provision whereby the
Participant may elect at any time before the Participant’s
Termination to exercise the Stock Option as to any part or all of
the shares of Common Stock subject to the Stock Option prior to the
full vesting of the Stock Option and such shares shall be subject
to the provisions of Article VIII and treated as Restricted Stock.
Any unvested shares of Common Stock so purchased may be subject to
a repurchase option in favor of the Company or to any other
restriction the Committee determines to be appropriate.
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(i)
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Other Terms
and Conditions . Stock
Options may contain such other provisions, which shall not be
inconsistent with any of the terms of this Plan, as the Committee
shall, in its sole discretion, deem appropriate.
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ARTICLE VII
STOCK APPRECIATION RIGHTS
7.1
Tandem Stock Appreciation Rights . Stock Appreciation
Rights may be granted in conjunction with all or part of any Stock
Option (a “ Reference Stock Option ”) granted
under this Plan (“ Tandem Stock Appreciation Rights
”). In the case of a Non-Qualified Stock Option, such rights
may be granted either at or after the time of the grant of such
Reference Stock Option. In the case of an Incentive Stock Option,
such rights may be granted only at the time of the grant of such
Reference Stock Option.
7.2
Terms and Conditions of Tandem Stock Appreciation
Rights . Tandem Stock Appreciation Rights granted hereunder
shall be subject to such terms and conditions, not inconsistent
with the provisions of this Plan, as shall be determined from time
to time by the Committee in its sole discretion, and the
following:
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(a)
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Exercise
Price . The exercise
price per share of Common Stock subject to a Tandem Stock
Appreciation Right shall be determined by the Committee at the time
of grant, provided that the per share exercise price of a Tandem
Stock Appreciation Right shall not be less than 100% of the Fair
Market Value of the Common Stock at the time of grant.
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(b)
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Term .
A Tandem Stock Appreciation Right or applicable portion thereof
granted with respect to a Reference Stock Option shall terminate
and no longer be exercisable upon the termination or exercise of
the Reference Stock Option, except that, unless otherwise
determined by the Committee, in its sole discretion, at the time of
grant, a Tandem Stock Appreciation Right granted with respect to
less than the full number of shares covered by the Reference Stock
Option shall not be reduced until and then only to the extent the
exercise or termination of the Reference Stock Option causes the
number of shares covered by the Tandem Stock Appreciation Right to
exceed the number of shares remaining available and unexercised
under the Reference Stock Option.
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(c)
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Exercisability . Tandem Stock Appreciation Rights shall be
exercisable only at such time or times and to the extent that the
Reference Stock Options to which they relate shall be exercisable
in accordance with the provisions of Article VI, and shall be
subject to the provisions of Section 6.3(c).
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(d)
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Method of
Exercise . A Tandem Stock
Appreciation Right may be exercised by the Participant by
surrendering the applicable portion of the Reference Stock Option.
Upon such exercise and surrender, the Participant shall be entitled
to receive an amount determined in the manner prescribed in this
Section 7.2. Stock Options which have been so surrendered, in whole
or in part, shall no longer be exercisable to the extent the
related Tandem Stock Appreciation Rights have been
exercised.
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(e)
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Payment . Upon the exercise of a Tandem Stock
Appreciation Right, a Participant shall be entitled to receive up
to, but no more than, an amount in cash or a number
of shares of Common Stock (as determined by the Committee, in its
sole discretion, on the date of grant) equal in value to the excess
of the Fair Market Value of one share of Common Stock over the
Option exercise price per share specified in the Reference Stock
Option agreement, multiplied by the number of shares in respect of
which the Tandem Stock Appreciation Right shall have been
exercised.
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(f)
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Deemed
Exercise of Reference Stock Option . Upon the exercise of a Tandem Stock
Appreciation Right, the Reference Stock Option or part thereof to
which such Stock Appreciation Right is related shall be deemed to
have been exercised for the purpose of the limitation set forth in
Article IV of the Plan on the number of shares of Common Stock to
be issued under the Plan.
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(g)
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Non-Transferability . Tandem Stock Appreciation Rights shall be
Transferable only when and to the extent that the underlying Stock
Option would be Transferable under Section 6.3(e) of the
Plan.
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7.3
Non-Tandem Stock
Appreciation Rights . Non-Tandem Stock Appreciation Rights
may also be granted without reference to any Stock Options granted
under this Plan.
7.4
Terms and Conditions of Non-Tandem Stock Appreciation
Rights . Non-Tandem Stock Appreciation Rights granted
hereunder shall be subject to such terms and conditions, not
inconsistent with the provisions of this Plan, as shall be
determined from time to time by the Committee in its sole
discretion, and the following:
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(a)
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Exercise
Price . The exercise
price per share of Common Stock subject to a Non-Tandem Stock
Appreciation Right shall be determined by the Committee at the time
of grant, provided that the per share exercise price of a
Non-Tandem Stock Appreciation Right shall not be less than 100% of
the Fair Market Value of the Common Stock at the time of
grant.
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(b)
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Term .
The term of each Non-Tandem Stock Appreciation Right shall be fixed
by the Committee, but shall not be greater than 10 years after the
date the right is granted.
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(c)
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Exercisability . Non-Tandem Stock Appreciation Rights shall be
exercisable at such time or times and subject to such terms and
conditions as shall be determined by the Committee at grant. If the
Committee provides, in its discretion, that any such right is
exercisable subject to certain limitations (including, without
limitation, that it is exercisable only in installments or within
certain time periods), the Committee may waive such limitations on
the exercisability at any time at or after grant in whole or in
part (including, without limitation, waiver of the installment
exercise provisions or acceleration of the time at which such right
may be exercised), based on such factors, if any, as the Committee
shall determine, in its sole discretion. In the event that a
written employment agreement between the Company and a Participant
provides for a vesting schedule that is more favorable than the
vesting schedule provided in the form of Award agreement, the
vesting schedule in such employment agreement shall govern,
provided that such agreement is in effect on the date of grant and
applicable to the specific Award.
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(d)
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Method of
Exercise . Subject to
whatever installment exercise and waiting period provisions
applicable under subsection (c) above, Non-Tandem Stock
Appreciation Rights may be exercised in whole or in part at any
time in accordance with the applicable Award agreement, by giving
written notice of exercise to the Company specifying the number of
Non-Tandem Stock Appreciation Rights to be exercised.
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(e)
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Payment . Upon the exercise of a Non-Tandem Stock
Appreciation Right a Participant shall be entitled to receive, for
each right exercised, up to, but no more than, an amount in cash or
a number of shares of Common Stock (as determined by the Committee,
in its sole discretion, on the date of grant) equal in value to the
excess of the Fair Market Value of one share of Common Stock on the
date the right is exercised over the Fair Market Value of one share
of Common Stock on the date the right was awarded to the
Participant.
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(f)
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Non-Transferability . No Non-Tandem Stock Appreciation Rights shall
be Transferable by the Participant otherwise than by will or by the
laws of descent and distribution, and all such rights shall be
exercisable, during the Participant’s lifetime, only by the
Participant.
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7.5
Limited Stock Appreciation Rights . The Committee
may, in its sole discretion, grant Tandem and Non-Tandem Stock
Appreciation Rights either as a general Stock Appreciation Right or
as a Limited Stock Appreciation Right. Limited Stock Appreciation
Rights may be exercised only upon the occurrence of a Change in
Control or such other event as the Committee may, in its sole
discretion, designate at the time of grant or thereafter. Upon the
exercise of Limited Stock Appreciation Rights, except as otherwise
provided in an Award agreement, the Participant shall receive in
cash or Common Stock, as determined by the Committee, an amount
equal to the amount (a) set forth in Section 7.2(e) with
respect to Tandem Stock Appreciation Rights, or (b) set forth
in Section 7.4(e) with respect to Non-Tandem Stock Appreciation
Rights, as applicable.
ARTICLE VIII
RESTRICTED STOCK
8.1
Awards of Restricted Stock . Shares of Restricted
Stock may be issued either alone or in addition to other Awards
granted under the Plan. The Committee shall, in its sole
discretion, determine the Eligible Employees, Consultants and
Non-Employee Directors, to whom, and the time or times at which,
grants of Restricted Stock shall be made, the number of shares to
be awarded, the price (if any) to be paid by the Participant
(subject to Section 8.2), the time or times within which such
Awards may be subject to forfeiture, the vesting schedule and
rights to acceleration thereof, and all other terms and conditions
of the Awards. The Committee may condition the grant or vesting of
Restricted Stock upon the attainment of specified performance
targets or such other factors as the Committee may determine, in
its sole discretion, including compliance with the requirements of
Section 162(m) of the Code.
8.2
Awards and
Certificates . Eligible Employees, Consultants and
Non-Employee Directors selected to receive Restricted Stock shall
not have any rights with respect to such Award, unless and until
such Participant has delivered a fully executed copy of the
agreement evidencing the Award to the Company and has otherwise
complied with the applicable terms and conditions of such Award.
Further, such Award shall be subject to the following
conditions:
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(a)
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Purchase
Price . The purchase
price of Restricted Stock shall be fixed by the Committee. Subject
to Section 4.3, the purchase price for shares of Restricted Stock
may be zero to the extent permitted by applicable law, and, to the
extent not so permitted, such purchase price may not be less than
par value.
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(b)
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Acceptance . Awards of Restricted Stock must be accepted
within a period of 60 days (or such other period as the Committee
may specify) after the grant date, by executing a Restricted Stock
agreement and by paying whatever price (if any) the Committee has
designated thereunder.
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(c)
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Legend . Each Participant receiving Restricted Stock
shall be issued a stock certificate in respect of such shares of
Restricted Stock, unless the Committee elects to use another
system, such as book entries by the transfer agent, as evidencing
ownership of shares of Restricted Stock. Such certificate shall be
registered in the name of such Participant, and shall, in addition
to such legends required by applicable securities laws, bear an
appropriate legend referring to the terms, conditions, and
restrictions applicable to such Award, substantially in the
following form:
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“The
anticipation, alienation, attachment, sale, transfer, assignment,
pledge, encumbrance or charge of the shares of stock represented
hereby are subject to the terms and conditions (including
forfeiture) of the RINO International Corporation (the
“Company”) 2009 Stock Incentive Plan (the
“Plan”) and an agreement entered into between the
registered owner and the Company dated __________. Copies of such
Plan and agreement are on file at the principal office of the
Company.”
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(d)
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Custody . If stock certificates are issued in respect of
shares of Restricted Stock, the Committee may require that any
stock certificates evidencing such shares be held in custody by the
Company until the restrictions thereon shall have lapsed, and that,
as a condition of any grant of Restricted Stock, the Participant
shall have delivered a duly signed stock power, endorsed in blank,
relating to the Common Stock covered by such Award.
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8.3
Restrictions and Conditions . The shares of
Restricted Stock awarded pursuant to this Plan shall be subject to
the following restrictions and conditions:
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(a)
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Restriction
Period . (1) The
Participant shall not be permitted to Transfer shares of Restricted
Stock awarded under this Plan during the period or periods set by
the Committee (the “ Restriction Period ”)
commencing on the date of such Award, as set forth in a Restricted
Stock Award agreement and such agreement shall set forth a vesting
schedule and any events which would accelerate vesting of the
shares of Restricted Stock. Within these limits, based on service,
attainment of performance goals pursuant to Section 8.3(a)(ii)
below and/or such other factors or criteria as the Committee may
determine in its sole discretion, the Committee may condition the
grant or provide for the lapse of such restrictions in installments
in whole or in part, or may accelerate the vesting of all or any
part of any Restricted Stock Award and/or waive the deferral
limitations for all or any part of any Restricted Stock Award. In
the event that a written employment agreement between the Company
and a Participant provides for a vesting schedule that is more
favorable than the vesting schedule provided in the form of Award
agreement, the vesting schedule in such employment agreement shall
govern, provided that such agreement is in effect on the date of
grant and applicable to the specific Award.
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(ii)
Objective Performance Goals, Formulae or Standards . If the
grant of shares of Restricted Stock or the lapse of restrictions is
based on the attainment of Performance Goals, the Committee shall
establish the Performance Goals and the applicable vesting
percentage of the Restricted Stock Award applicable to each
Participant or class of Participants in writing prior to the
beginning of the applicable fiscal year or at such later date as
otherwise determined by the Committee and while the outcome of the
Performance Goals are substantially uncertain. Such Performance
Goals may incorporate provisions for disregarding (or adjusting
for) changes in accounting methods, corporate transactions
(including, without limitation, dispositions and acquisitions) and
other similar type events or circumstances. With regard to a
Restricted Stock Award that is intended to comply with Section
162(m) of the Code, to the extent any such provision would create
impermissible discretion under Section 162(m) of the Code or
otherwise violate Section 162(m) of the Code, such provision shall
be of no force or effect. The applicable Performance Goals shall be
based on one or more of the performance criteria set forth in
Exhibit A hereto.
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(b)
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Rights as a
Stockholder . Except as
provided in this subsection (b) and subsection (a) above and as
otherwise determined by the Committee, the Participant shall have,
with respect to the shares of Restricted Stock, all of the rights
of a holder of shares of Common Stock of the Company including,
without limitation, the right to receive any dividends, the right
to vote such shares and, subject to and conditioned upon the full
vesting of shares of Restricted Stock, the right to tender such
shares. The Committee may, in its sole discretion, determine at the
time of grant that the payment of dividends shall be deferred
until, and conditioned upon, the expiration of the applicable
Restriction Period.
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(c)
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Lapse of
Restrictions . If and
when the Restriction Period expires without a prior forfeiture of
the Restricted Stock, the certificates for such shares shall be
delivered to the Participant. All legends shall be removed from
said certificates at the time of delivery to the Participant,
except as otherwise required by applicable law or other limitations
imposed by the Committee.
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ARTICLE IX
PERFORMANCE SHARES
9.1
Award of Performance Shares . Performance Shares may
be awarded either alone or in addition to other Awards granted
under this Plan. The Committee shall, in its sole discretion,
determine the Eligible Employees, Consultants and Non-Employee
Directors, to whom, and the time or times at which, Performance
Shares shall be awarded, the number of Performance Shares to be
awarded to any person, the Performance Period during which, and the
conditions under which, receipt of the Shares will be deferred, and
the other terms and conditions of the Award in addition to those
set forth in Section 9.2.
Except as otherwise provided herein, the
Committee shall condition the right to payment of any Performance
Share upon the attainment of objective performance goals
established pursuant to Section 9.2(c) below.
9.2
Terms and
Conditions . Performance Shares awarded pursuant to this
Article IX shall be subject to the following terms and
conditions:
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(a)
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Earning of
Performance Share Award .
At the expiration of the applicable Performance Period, the
Committee shall determine the extent to which the performance goals
established pursuant to Section 9.2(c) are achieved and the
percentage of each Performance Share Award that has been
earned.
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(b)
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Non-Transferability . Subject to the applicable provisions of the
Award agreement and this Plan, Performance Shares may not be
Transferred during the Performance Period.
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(c)
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Objective
Performance Goals, Formulae or Standards . The Committee shall establish the objective
Performance Goals for the earning of Performance Shares based on a
Performance Period applicable to each Participant or class of
Participants in writing prior to the beginning of the applicable
Performance Period or at such later date as permitted under Section
162(m) of the Code and while the outcome of the Performance Goals
are substantially uncertain. Such Performance Goals may
incorporate, if and only to the extent permitted under Section
162(m) of the Code, provisions for disregarding (or adjusting for)
changes in accounting methods, corporate transactions (including,
without limitation, dispositions and acquisitions) and other
similar type events or circumstances. To the extent any such
provision would create impermissible discretion under Section
162(m) of the Code or otherwise violate Section 162(m) of the Code,
such provision shall be of no force or effect. The applicable
Performance Goals shall be based on one or more of the performance
criteria set forth in Exhibit A hereto.
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(d)
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Dividends . Unless otherwise determined by the Committee
at the time of grant, amounts equal to any dividends declared
during the Performance Period with respect to the number of shares
of Common Stock covered by a Performance Share will not be paid to
the Participant.
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(e)
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Payment . Following the Committee’s determination
in accordance with subsection (a) above, shares of Common Stock or,
as determined by the Committee in its sole discretion, the cash
equivalent of such shares shall be delivered to the Eligible
Employee, Consultant or Non-Employee Director, or his legal
representative, in an amount equal to such individual’s
earned Performance Share. Notwithstanding the foregoing, the
Committee may, in its sole discretion, award an amount less than
the earned Performance Share and/or subject the payment of all or
part of any Performance Share to additional vesting, forfeiture and
deferral conditions as it deems appropriate.
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(f)
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Accelerated
Vesting . Based on
service, performance and/or such other factors or criteria, if any,
as the Committee may determine, the Committee may, in its sole
discretion, at or after grant, accelerate the vesting of all or any
part of any Performance Share Award and/or waive the deferral
limitations for all or any part of such Award.
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ARTICLE X
OTHER STOCK-BASED AWARDS
10.1
Other Awards . The Committee, in its sole discretion,
is authorized to grant to Eligible Employees, Consultants and
Non-Employee Directors Other Stock-Based Awards that are payable
in, valued in whole or in part by reference to, or otherwise based
on or related to shares of Common Stock, including, but not limited
to, shares of Common Stock awarded purely as a bonus and not
subject to any restrictions or conditions, shares of Common Stock
in payment of the amounts due under an incentive or performance
plan sponsored or maintained by the Company or an Affiliate,
performance units, dividend equivalent units, stock equivalent
units, restricted stock units and deferred stock units. To the
extent permitted by law, the Committee may, in its sole discretion,
permit Eligible Employees and/or Non-Employee Directors to defer
all or a portion of their cash compensation in the form of Other
Stock-Based Awards granted under this
