CENVEO, INC. 2001 LONG-TERM EQUITY INCENTIVE PLAN

 

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                                                                 Exhibit 4.1

 

                                CENVEO, INC.

 

                    2001 LONG-TERM EQUITY INCENTIVE PLAN

 

SECTION 1   PURPOSE

 

         This plan shall be known as the "Cenveo, Inc. 2001 Long-Term Equity

Incentive Plan" (the "Plan"). The purpose of the Plan is to promote the

interests of Cenveo, Inc. (the "Company") and its Subsidiaries and the

Company's stockholders by (i) attracting and retaining key officers,

employees, and directors of, and consultants to, the Company and its

Subsidiaries and any future Affiliates; (ii) motivating such individuals by

means of performance-related incentives to achieve long-range performance

goals; (iii) enabling such individuals to participate in the long-term

growth and financial success of the Company; (iv) encouraging ownership of

stock in the Company by such individuals; and (v) linking their compensation

to the long-term interests of the Company and its stockholders. With respect

to any awards granted under the Plan that are intended to comply with the

requirements of "performance-based compensation" under Section 162(m) of the

Code, the Plan shall be interpreted in a manner consistent with such

requirements.

 

SECTION 2   DEFINITIONS

 

          As used in the Plan, the following terms shall have the meanings

set forth below:

 

         (a) "AFFILIATE" shall mean (i) any entity that, directly or

indirectly, is controlled by the Company, (ii) any entity in which the

Company has a significant equity interest, (iii) an affiliate of the

Company, as defined in Rule 12b-2 promulgated under Section 12 of the

Exchange Act, and (iv) any entity in which the Company has at least twenty

percent (20%) of the combined voting power of the entity's outstanding

voting securities, in each case as designated by the Board as being a

participating employer in the Plan.

 

         (b) "AWARD" shall mean any Option, Stock Appreciation Right,

Restricted Share Award, Restricted Share Unit, Performance Award, Other

Stock-Based Award or other award granted under the Plan, whether singly, in

combination, or in tandem, to a Participant by the Committee (or the Board)

pursuant to such terms, conditions, restrictions and/or limitations, if any,

as the Committee (or the Board) may establish.

 

         (c) "AWARD AGREEMENT" shall mean any written agreement, contract,

or other instrument or document evidencing any Award, which may, but need

not, be executed or acknowledged by a Participant.

 

         (d) "BOARD" shall mean the board of directors of the Company.

 

         (e) "CHANGE IN CONTROL" shall mean, unless otherwise defined in the

applicable Award Agreement, any of the following events:

 

             (i)    An acquisition (other than directly from the Company)

of any voting securities of the Company (the "Voting Securities") by any

"Person" (as the term Person is used for purposes of Section 13(d) or 14(d)

of the Exchange Act) immediately after which such

 

 

 

Person has "Beneficial Ownership" (within the meaning of Rule 13d-3

promulgated under the Exchange Act) of forty percent (40%) or more of the

combined voting power of the then outstanding Voting Securities; provided,

however, that in determining whether a Change in Control has occurred,

Voting Securities which are acquired in a "Non-Control Acquisition" (as

hereinafter defined) shall not constitute an acquisition which would cause a

Change in Control. A "Non-Control Acquisition" shall mean an acquisition by

(i) an employee benefit plan (or a trust forming a part thereof) maintained

by (A) the Company or (B) any Subsidiary or (ii) the Company or any

Subsidiary;

 

             (ii)   The individuals who, as of the date hereof, are

members of the Board (the "Incumbent Board"), cease for any reason to

constitute at least a majority of the Board; provided, however, that if the

election or nomination for election by the Company's stockholders of any new

director was approved by a vote of at least two-thirds of the Incumbent

Board, such new director shall, for purposes of this Agreement, be

considered as a member of the Incumbent Board; provided, further, however,

that no individual shall be considered a member of the Incumbent Board if

(1) such individual initially assumed office as a result of either an actual

or threatened "Election Contest" (as described in Rule 14a-11 promulgated

under the Exchange Act) or other actual or threatened solicitation of

proxies or consents by or on behalf of a Person other than the Board (a

"Proxy Contest") including by reason of any agreement intended to avoid or

settle any Election Contest or Proxy Contest or (2) such individual was

designated by a Person who has entered into an agreement with the Company to

effect a transaction described in clause (i) or (iii) of this paragraph; or

 

             (iii) Approval by stockholders of the Company of:

 

                   (A) A merger, consolidation or reorganization involving

         the Company, unless,

 

                       (1) The stockholders of the Company immediately

             before such merger, consolidation or reorganization, own,

             directly or indirectly, immediately following such merger,

             consolidation or reorganization, at least seventy-five percent

             (75%) of the combined voting power of the outstanding Voting

             Securities of the corporation (the "Surviving Corporation") in

             substantially the same proportion as their ownership of the

             Voting Securities immediately before such merger, consolidation

             or reorganization;

 

                       (2) The individuals who were members of the Incumbent

             Board immediately prior to the execution of the agreement

             providing for such merger, consolidation or reorganization

             constitute at least two-thirds of the members of the board of

             directors of the Surviving Corporation; and

 

                       (3) No Person (other than the Company, any

             Subsidiary, any employee benefit plan (or any trust forming a

              part thereof) maintained by the Company, the Surviving

             Corporation or any Subsidiary, or any Person who, immediately

             prior to such merger, consolidation or reorganization, had

             Beneficial Ownership of forty percent (40%) or more of the then

             outstanding Voting Securities) has Beneficial Ownership of

             forty percent (40%) or more of

 

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             the combined voting power of the Surviving Corporation's then

             outstanding Voting Securities.

 

                   (B) A complete liquidation or dissolution of the Company;

         or

 

                   (C) An agreement for the sale or other disposition of all

         or substantially all of the assets of the Company to any Person

         (other than a transfer to a Subsidiary).

 

Notwithstanding the foregoing, a Change in Control shall not be deemed to

occur solely because any Person (the "Subject Person") acquired Beneficial

Ownership of more than the permitted amount of the outstanding Voting

Securities as a result of the acquisition of Voting Securities by the

Company which, by reducing the number of Voting Securities outstanding,

increased the proportional number of shares Beneficially Owned by the

Subject Person, provided that if a Change in Control would occur (but for

the operation of this sentence) as a result of the acquisition of Voting

Securities by the Company, and after such share acquisition by the Company,

the Subject Person becomes the Beneficial Owner of any additional Voting

Securities Beneficially Owned by the Subject Person, then a Change in

Control shall occur.

 

         (f) "CODE" shall mean the Internal Revenue Code of 1986, as amended

from time to time.

 

         (g) "COMMITTEE" shall mean a committee of the Board composed

entirely of Non-Employee Directors, each of whom shall be a "Non-Employee

Director" for purposes of Exchange Act Section 16 and Rule 16b-3 thereunder

and an "outside director" for purposes of Section 162(m) and the regulations

promulgated under the Code.

 

         (h) "CONSULTANT" shall mean any consultant to the Company or its

Subsidiaries or Affiliates.

 

         (i) "COVERED OFFICER" shall mean at any date (i) any individual

who, with respect to the previous taxable year of the Company, was a

"covered employee" of the Company within the meaning of Section 162(m);

provided, however, that the term "Covered Officer" shall not include any

such individual who is designated by the Committee, in its discretion, at

the time of any Award or at any subsequent time, as reasonably expected not

to be such a "covered employee" with respect to the current taxable year of

the Company and (ii) any individual who is designated by the Committee, in

its discretion, at the time of any Award or at any subsequent time, as

reasonably expected to be such a "covered employee" with respect to the

current taxable year of the Company or with respect to the taxable year of

the Company in which any applicable Award will be paid.

 

         (j) "DIRECTOR" shall mean a member of the Board.

 

         (k) "EMPLOYEE" shall mean a current or prospective officer or

employee of the Company or of any Subsidiary or Affiliate.

 

         (l) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,

as amended from time to time.

 

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         (m) "FAIR MARKET VALUE" with respect to the Shares, shall mean, for

purposes of a grant of an Award as of any date, (i) the closing sales price

of the Shares on the New York Stock Exchange, or any other such exchange on

which the shares are traded, on such date, or in the absence of reported

sales on such date, the closing sales price on the immediately preceding

date on which sales were reported or (ii) in the event there is no public

market for the Shares on such date, the fair market value as determined, in

good faith, by the Committee in its sole discretion, and for purposes of a

sale of a Share as of any date, the actual sales price on that date.

 

         (n) "INCENTIVE STOCK OPTION" shall mean an option to purchase

Shares from the Company that is granted under Section 6 of the Plan and that

is intended to meet the requirements of Section 422 of the Code or any

successor provision thereto.

 

         (o) "NON-QUALIFIED STOCK OPTION" shall mean an option to purchase

Shares from the Company that is granted under Section 6 or 10 of the Plan

and is not intended to be an Incentive Stock Option.

 

         (p) "NON-EMPLOYEE DIRECTOR" shall mean a member of the Board who is

not an officer or employee of the Company or any Subsidiary or Affiliate.

 

         (q) "OPTION" shall mean an Incentive Stock Option or a

Non-Qualified Stock Option.

 

         (r) "OPTION PRICE" shall mean the purchase price payable to

purchase one Share upon the exercise of an Option.

 

         (s) "OTHER STOCK-BASED AWARD" shall mean any Award granted under

Section 9 or 10 of the Plan.

 

         (t) "PARTICIPANT" shall mean any Employee, Director, Consultant or

other person who receives an Award under the Plan.

 

         (u) "PERFORMANCE AWARD" shall mean any Award granted under Section

8 of the Plan.

 

         (v) "PERSON" shall mean any individual, corporation, partnership,

limited liability company, associate, joint-stock company, trust,

unincorporated organization, government or political subdivision thereof or

other entity.

 

         (w) "RESTRICTED SHARE" shall mean any Share granted under Section 7

or 10 of the Plan.

 

         (x) "RESTRICTED SHARE UNIT" shall mean any unit granted under

Section 7 or 10 of the Plan.

 

         (y) "SEC" shall mean the Securities and Exchange Commission or any

successor thereto.

 

                                   - 4 -

 

 

         (z) "SECTION 16" shall mean Section 16 of the Exchange Act and the

rules promulgated thereunder and any successor provision thereto as in

effect from time to time.

 

         (aa) "SECTION 162(M)" shall mean Section 162(m) of the Code and the

regulations promulgated thereunder and any successor or provision thereto as

in effect from time to time.

 

          (bb) "SHARES" shall mean shares of the common stock, $0.01 par

value, of the Company.

 

         (cc) "STOCK APPRECIATION RIGHT" or "SAR" shall mean a stock

appreciation right granted under Section 6 or 10 of the Plan that entitles

the holder to receive, with respect to each Share encompassed by the

exercise of such SAR, the amount determined by the Committee and specified

in an Award Agreement. In the absence of such a determination, the holder

shall be entitled to receive, with respect to each Share encompassed by the

exercise of such SAR, the excess of the Fair Market Value on the date of

exercise over the Fair Market Value on the date of grant.

 

         (dd) "SUBSIDIARY" shall mean any Person (other than the Company) of

which a majority of its voting power or its equity securities or equity

interest is owned directly or indirectly by the Company.

 

         (ee) "SUBSTITUTE AWARDS" shall mean Awards granted solely in

assumption of, or in substitution for, outstanding awards previously granted

by a company acquired by the Company or with which the Company combines.

 

         (ff) "TANDEM SAR" shall mean an SAR that is granted under Section 6

or 10 of the Plan in relation to a particular Option and that can be

exercised only upon the surrender to the Company, unexercised, of that

portion of the Option to which the SAR relates.

 

SECTION 3   ADMINISTRATION

 

         3.1 Authority of Committee. The Plan shall be administered by the

             ----------------------

Committee, which shall be appointed by and serve at the pleasure of the

Board; provided, however, with respect to Awards to Directors who are

members of the Committee, all references in the Plan to the Committee shall

be deemed to be references to the Board. Subject to the terms of the Plan

and applicable law, and in addition to other express powers and

authorizations conferred on the Committee by the Plan, the Committee shall

have full power and authority in its discretion to: (i) designate

Participants; (ii) determine the type or types of Awards to be granted to a

Participant; (iii) determine the number of Shares to be covered by, or with

respect to which payments, rights, or other matters are to be calculated in

connection with Awards; (iv) determine the timing, terms, and conditions of

any Award; (v) accelerate the time at which all or any part of an Award may

be settled or exercised; (vi) determine whether, to what extent, and under

what circumstances Awards may be settled or exercised in cash, Shares, other

securities, other Awards or other property, or canceled, forfeited, or

suspended and the method or methods by which Awards may be settled,

exercised, canceled, forfeited, or suspended; (vii) determine whether, to

what extent, and under what circumstances cash, Shares, other securities,

other Awards, other property, and other amounts payable with respect to an

Award shall be deferred either automatically or at the election of the

holder thereof or of the Committee; (viii) interpret

 

                                   - 5 -

 

 

and administer the Plan and any instrument or agreement relating to, or

Award made under, the Plan; (ix) except to the extent prohibited by Section

6.2, amend or modify the terms of any Award at or after grant with the

consent of the holder of the Award; (x) establish, amend, suspend, or waive

such rules and regulations and appoint such agents as it shall deem

appropriate for the proper administration of the Plan; and (xi) make any

other determination and take any other action that the Committee deems

necessary or desirable for the administration of the Plan, subject to the

exclusive authority of the Board under Section 14 hereunder to amend or

terminate the Plan.

 

         3.2 Committee Discretion Binding. Unless otherwise expressly

             ----------------------------

provided in the Plan, all designations, determinations, interpretations, and

other decisions under or with respect to the Plan or any Award shall be

within the sole discretion of the Committee, may be made at any time and

shall be final, conclusive, and binding upon all Persons, including the

Company, any Subsidiary or Affiliate, any Participant and any holder or

beneficiary of any Award.

 

         3.3 Action by the Committee. The Committee shall select one of its

             -----------------------

members as its Chairperson and shall hold its meetings at such times and

places and in such manner as it may determine. A majority of its members

shall constitute a quorum. All determinations of the Committee shall be made

by not less than a majority of its members. Any decision or determination

reduced to writing and signed by all of the members of the Committee shall

be fully effective as if it had been made by a majority vote at a meeting

duly called and held. The exercise of an Option or receipt of an Award shall

be effective only if an Award Agreement shall have been duly executed and

delivered on behalf of the Company following the grant of the Option or

other Award. The Committee may appoint a Secretary and may make such rules

and regulations for the conduct of its business, as it shall deem advisable.

 

         3.4 Delegation. Subject to the terms of the Plan and applicable

             ----------

law, the Committee may delegate to one or more officers or managers of the

Company or of any Subsidiary or Affiliate, or to a Committee of such

officers or managers, the authority, subject to such terms and limitations

as the Committee shall determine, to grant Awards to, or to cancel, modify

or waive rights with respect to, or to alter, discontinue, suspend, or

terminate Awards held by Participants who are not officers or directors of

the Company for purposes of Section 16 or who are otherwise not subject to

such Section.

 

         3.5 No Liability. No member of the Board or Committee shall be

             ------------

liable for any action taken or determination made in good faith with respect

to the Plan or any Award granted hereunder.

 

SECTION 4   SHARES AVAILABLE FOR AWARDS

 

         4.1 Shares Available. Subject to the provisions of Section 4.2

             ----------------

hereof, the stock to be subject to Awards under the Plan shall be the Shares

of the Company and the maximum number of Shares with respect to which Awards

may be granted under the Plan shall be 7,450,000 (which includes 61,281

Shares with respect to which awards under the Mail-Well, Inc. 1994 Stock

Option Plan (the "1994 Plan") were authorized but not granted, 294,000

Shares with respect to which awards under the Mail-Well, Inc. 1996 Directors

Stock Option Plan (the "1996 Plan") were authorized but not granted, 26,465

Shares with respect to which awards under the Mail-Well, Inc. 1997

Non-Qualified Stock Option Plan (the "1997 Plan") were authorized but

 

                                   - 6 -

 

 

not granted, and 42,971 Shares with respect to which awards under the

Mail-Well, Inc. 1998 Stock Option Plan (the "1998 Plan") were authorized but

not granted), of which (i) no more than 4,425,000 Shares shall be issued

with respect to Incentive Stock Options, (ii) no more than 1,500,000 Shares

shall be issued with respect to SARs, (iii) no more than 1,000,000 Shares

shall be granted as Restricted Shares and (iv) no more than 750,000 Shares

shall be granted as Restricted Share Units. Notwithstanding the foregoing

and subject to adjustment as provided in Section 4.2, the maximum number of

Shares with respect to which Awards may be granted under the Plan shall be

increased by the number of Shares with respect to which Options or other

Awards were granted under the 1994, 1996, 1997 and 1998 Plans, as of the

effective date of this Plan, but which terminate, expire unexercised, or are

settled for cash, forfeited or canceled without the delivery of Shares under

the terms of such Plans after the effective date of this Plan. The number of

Shares to which Awards may be granted under the Plan may not be increased

unless such increase is approved by at least a majority of the outstanding

Shares.

 

         If, after the effective date of the Plan, any Shares covered by an

Award granted under this Plan, or to which such an Award relates, are

forfeited, or if such an Award is settled for cash or otherwise terminates,

expires unexercised, or is canceled without the delivery of Shares, then the

Shares covered by such Award, or to which such Award relates, or the number

of Shares otherwise counted against the aggregate number of Shares with

respect to which Awards may be granted, to the extent of any such

settlement, forfeiture, termination, expiration, or cancellation, shall

again become Shares with respect to which Awards may be granted. In the

event that any Option or other Award granted hereunder is exercised through

the delivery of Shares or in the event that withholding tax liabilities

arising from such Award are satisfied by the withholding of Shares by the

Company, the number of Shares available for Awards under the Plan shall be

increased by the number of Shares so surrendered or withheld.

Notwithstanding the foregoing and subject to adjustment as provided in

Section 4.2 hereof, no Participant may receive Options or SAR's under the

Plan in any calendar year that relate to more than 1,500,000 shares, unless

such Options or SAR's are granted in connection with the recruiting and

hiring of a Participant simultaneously with such Award.

 

         4.2 Adjustments. In the event that the Committee determines that

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any dividend or other distribution (whether in the form of cash, Shares,

other securities, or other property) recapitalization, stock split, reverse

stock split, reorganization, merger, consolidation, split-up, spin-off,

combination, repurchase, or exchange of Shares or other securities of the

Company, issuance of warrants or other rights to purchase Shares or other

securities of the Company, or other similar corporate transaction or event

affects the Shares such that an adjustment is determined by the Committee,

in its sole discretion, to be appropriate, then the Committee shall, in such

manner as it may deem equitable (and, with respect to Incentive Stock

Options, in such manner as is consistent with Section 422 of the Code and

the regulations thereunder): (i) adjust any or all of (1) the aggregate

number of Shares or other securities of the Company (or number and kind of

other securities or property) with respect to which Awards may be granted

under the Plan; (2) the number of Shares or other securities of the Company

(or number and kind of other securities or property) subject to outstanding

Awards under the Plan; and (3) the grant or exercise price with respect to

any Award under the Plan, provided that the number of shares subject to any

Award shall always be a whole number; (ii) if deemed appropriate, provide

for an equivalent award in respect of securities of the surviving entity of

any merger, consolidation or other transaction or event having a similar

effect; or (iii) if deemed appropriate, make provision for a cash payment to

the holder of an outstanding Award.

 

                                   - 7 -

 

 

         4.3 Substitute Awards. Any Shares issued by the Company as

             -----------------

Substitute Awards in connection with the assumption or substitution of

outstanding grants from any acquired corporation shall not reduce the Shares

available for Awards under the Plan.

 

         4.4 Sources of Shares Deliverable Under Awards. Any Shares

             ------------------------------------------

delivered pursuant to an Award may consist, in whole or in part, of

authorized and unissued Shares or of issued Shares that have been reacquired

by the Company.

 

SECTION 5   ELIGIBILITY

 

          Any E