__________________________________________________________________
UNDER ARMOUR, INC.
2005 OMNIBUS LONG-TERM INCENTIVE
PLAN
__________________________________________________________________
TABLE OF
CONTENTS
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Page
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1.
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PURPOSE
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1
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2.
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DEFINITIONS
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1
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3.
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ADMINISTRATION OF THE
PLAN
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5
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3.1.
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General
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5
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3.2.
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Deferral Arrangement
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6
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3.3.
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No Liability
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6
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3.4.
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Book Entry
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6
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4.
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STOCK SUBJECT TO THE
PLAN
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6
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5.
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EFFECTIVE DATE, DURATION AND
AMENDMENTS
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7
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5.1.
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Term
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7
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5.2.
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Amendment and Termination of
the Plan
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7
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6.
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AWARD ELIGIBILITY AND
LIMITATIONS
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7
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6.1.
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Service Providers and Other
Persons
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7
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6.2.
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Successive Awards
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8
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6.3.
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Stand-Alone, Additional,
Tandem, and Substitute Awards
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8
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7.
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AWARD AGREEMENT
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8
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8.
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TERMS AND CONDITIONS OF
OPTIONS
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9
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8.1.
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Option Price
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9
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8.2.
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Vesting
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9
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8.3.
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Term
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9
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8.4.
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Termination of Service
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9
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8.5.
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Limitations on Exercise of
Option
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9
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8.6.
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Method of Exercise
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10
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8.7.
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Rights of Holders of
Options
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10
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8.8.
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Delivery of Stock
Certificates
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10
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8.9.
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Transferability of
Options
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10
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8.10.
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Family Transfers
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10
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8.11.
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Limitations on Incentive Stock
Options
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11
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9.
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TERMS AND CONDITIONS OF STOCK
APPRECIATION RIGHTS
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11
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9.1.
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Right to Payment
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11
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9.2.
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Other Terms
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11
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10.
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TERMS AND CONDITIONS OF
RESTRICTED STOCK AND STOCK
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UNITS
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12
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10.1.
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Restrictions
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12
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10.2.
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Restricted Stock
Certificates
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12
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10.3.
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Rights of Holders of
Restricted Stock
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12
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10.4.
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Rights of Holders of
Restricted Stock Units
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12
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10.4.1.
Voting and Dividend
Rights
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12
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10.4.2.
Creditor’s Rights
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13
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10.5.
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Termination of Service
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13
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10.6.
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Purchase of Restricted
Stock
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13
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10.7.
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Delivery of Stock
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13
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11.
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TERMS AND CONDITIONS OF
UNRESTRICTED STOCK AWARDS
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13
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12.
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FORM OF PAYMENT FOR OPTIONS
AND RESTRICTED STOCK
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14
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12.1.
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General Rule
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14
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12.2.
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Surrender of Stock
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14
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12.3.
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Cashless Exercise
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14
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12.4.
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Other Forms of Payment
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14
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13.
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TERMS AND CONDITIONS OF
DIVIDEND EQUIVALENT RIGHTS
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15
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13.1.
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Dividend Equivalent
Rights
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15
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13.2.
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Termination of Service
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15
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14.
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TERMS AND CONDITIONS OF
PERFORMANCE AND ANNUAL
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INCENTIVE AWARDS
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15
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14.1.
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Performance Conditions
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15
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14.2.
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Performance or Annual
Incentive Awards Granted to
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Designated Covered
Employees
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16
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14.2.1.
Performance
Goals Generally
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16
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14.2.2.
Business Criteria
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16
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14.2.3.
Timing
for Establishing Performance Goals
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16
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14.2.4.
Settlement
of Performance or Annual Incentive Awards; Other
Terms
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14.3.
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Written Determinations
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17
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14.4.
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Status of Section 14.2 Awards
Under Code Section 162(m)
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17
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15.
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REQUIREMENTS OF LAW
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17
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15.1.
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General.
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17
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15.2.
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Rule 16b-3
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18
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16.
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EFFECT OF CHANGES IN
CAPITALIZATION
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19
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16.1.
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Changes in Stock
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19
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16.2.
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Definition of Change in
Control
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19
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16.3.
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Effect of Change of Change in
Control
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20
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16.4.
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Reorganization Which Does Not
Constitute a Change in
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Control
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20
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16.5.
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Adjustments
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21
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16.6.
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No Limitations on
Company
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21
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17.
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GENERAL PROVISIONS
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21
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17.1.
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Disclaimer of Rights
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21
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17.2.
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Nonexclusivity of the
Plan
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21
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17.3.
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Withholding Taxes
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22
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17.4.
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Captions
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22
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17.5.
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Other Provisions
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22
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17.6.
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Number and Gender
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22
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17.7.
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Severability
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22
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17.8.
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Governing Law
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23
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17.9.
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Section 409A
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23
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17.9.1. Short-Term
Deferrals
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23
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17.9.2. Adjustments
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23
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UNDER
ARMOUR, INC.
2005
OMNIBUS LONG-TERM INCENTIVE PLAN
Under Armour, Inc., a Maryland corporation (the
“Company”), sets forth herein the terms of its 2005
Omnibus Long-Term Incentive Plan (the “Plan”), as
follows:
The
Plan is intended to enhance the Company’s and its
Affiliates’ (as defined herein) ability to attract and retain
highly qualified officers, directors, key employees, and other
persons, and to motivate such officers, directors, key employees,
and other persons to serve the Company and its Affiliates and to
expend maximum effort to improve the business results and earnings
of the Company, by providing to such persons an opportunity to
acquire or increase a direct proprietary interest in the operations
and future success of the Company. To this end, the Plan provides
for the grant of stock options, stock appreciation rights,
restricted stock, restricted stock units, unrestricted stock,
dividend equivalent rights and cash awards. Any of these awards
may, but need not, be made as performance incentives to reward
attainment of annual or long-term performance goals in accordance
with the terms hereof. Stock options granted under the Plan may be
non-qualified stock options or incentive stock options, as provided
herein.
For
purposes of interpreting the Plan and related documents (including
Award Agreements), the following definitions shall apply:
2.1 “
Affiliate ” means any company or other trade or
business that “controls,” is “controlled
by” or is “under common control” with the Company
within the meaning of Rule 405 of Regulation C under the Securities
Act, including, without limitation, any Subsidiary.
2.2 “ Annual
Incentive Award ” means an Award made subject to
attainment of performance goals (as described in Section 14
) over a performance period of a duration as specified by the
Committee).
2.3 “ Award
” means a grant of an Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit, Unrestricted Stock,
Dividend Equivalent Rights, or cash award under the Plan.
2.4 “ Award
Agreement ” means the written agreement between the
Company and a Grantee that evidences and sets out the terms and
conditions of an Award.
2.5 “ Board
” means the Board of Directors of the Company.
2.6 “ Cause
” means, as determined by the Board and unless otherwise
provided in an applicable agreement with the Company or an
Affiliate at or before the
Grant Date, (i) gross negligence or willful misconduct in
connection with the performance of duties; (ii) conviction of
a criminal offense (other than minor traffic offenses); or
(iii) material breach of any term of any employment,
consulting or other services, confidentiality, intellectual
property or non-competition agreements, if any, between the Service
Provider and the Company or an Affiliate.
2.7 “ Change in
Control ” shall have the meaning set forth in
Section 16.2.
2.8 “ Code
” means the Internal Revenue Code of 1986, as now in effect
or as hereafter amended.
2.9 “
Committee ” means the Compensation Committee of the
Board, or such other committee as determined by the Board.
2.10 “
Company ” means Under Armour, Inc.
2.11 “ Covered Employee
” means a Grantee who is a “covered employee”
within the meaning of Section 162(m)(3) of the Code as
qualified by Section 14.4 herein.
2.12 “ Disability ”
means the Grantee is unable to perform each of the essential duties
of such Grantee's position by reason of a medically determinable
physical or mental impairment which is potentially permanent in
character or which can be expected to last for a continuous period
of not less than 12 months; provided , however ,
that, with respect to rules regarding expiration of an Incentive
Stock Option following termination of the Grantee's Service,
Disability shall mean the Grantee is unable to engage in any
substantial gainful activity by reason of a medically determinable
physical or mental impairment which can be expected to result in
death or which has lasted or can be expected to last for a
continuous period of not less than 12 months.
2.13 “ Dividend Equivalent
Right ” means a right, granted to a Grantee under
Section 13 hereof, to receive cash, Stock, other Awards or
other property equal in value to dividends paid with respect to a
specified number of shares of Stock, or other periodic
payments.
2.14 “ Effective Date
” means ______ __, 2005, the effective date of the
Company’s Initial Public Offering.
2.15 “ Exchange Act
” means the Securities Exchange Act of 1934, as now in effect
or as hereafter amended.
2.16 “ Fair Market Value
” means the value of a share of Stock, determined as follows:
if on the Grant Date the Stock is listed on an established national
or regional stock exchange, is admitted to quotation on The Nasdaq
Stock Market, Inc. or is publicly traded on an established
securities market, the Fair Market Value of a share of Stock shall
be the closing price of the Stock on such exchange or in such
market (if there is more than one such exchange or market the
Committee shall determine the appropriate exchange or market) on
the Grant Date or (or if there is no such reported closing price,
the Fair Market Value shall be the mean between the highest bid
and
lowest asked prices or between the high and low sale prices on such
trading day) or, if no sale of Stock is reported for such trading
day, on the next preceding day on which any sale shall have been
reported. If the Stock is not listed on such an exchange, quoted on
such system or traded on such a market, Fair Market Value shall be
the value of the Stock as determined by the Committee in good faith
using a reasonable valuation method in accordance with Section 409A
of the Code.
2.17 “ Family Member
” means a person who is a spouse, former spouse, child,
stepchild, grandchild, parent, stepparent, grandparent, niece,
nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother, sister, brother-in-law, or sister-in-law, including
adoptive relationships, of the applicable individual, any person
sharing the applicable individual’s household (other than a
tenant or employee), a trust in which any one or more of these
persons have more than fifty percent of the beneficial interest, a
foundation in which any one or more of these persons (or the
applicable individual) control the management of assets, and any
other entity in which one or more of these persons (or the
applicable individual) own more than fifty percent of the voting
interests.
2.18 “ Grant Date ”
means, as determined by the Committee, the latest to occur of (i)
the date as of which the Committee approves an Award, (ii) the date
on which the recipient of an Award first becomes eligible to
receive an Award under Section 6 hereof, or
(iii) such other date as may be specified by the Committee in the
Award Agreement.
2.19 “ Grantee ”
means a person who receives or holds an Award under the Plan.
2.20 “ Incentive Stock
Option ” means an “incentive stock option”
within the meaning of Section 422 of the Code, or the corresponding
provision of any subsequently enacted tax statute, as amended from
time to time.
2.21 “ Non-qualified Stock
Option ” means an Option that is not an Incentive Stock
Option.
2.22 “ Option ”
means an option to purchase one or more shares of Stock pursuant to
the Plan.
2.23 “ Option Price
” means the exercise price for each share of Stock subject to
an Option.
2.24 “ Outside Director
” means a member of the Board who is not an officer or
employee of the Company or an Affiliate.
2.25 “ Performance Award
” means an Award made subject to the attainment of
performance goals (as described in Section 14) over a
performance period of up to ten (10) years.
2.26 “ Plan ” means
this the Under Armour, Inc. 2005 Omnibus Long-Term Incentive
Plan.
2.27 “ Purchase Price
” means the purchase price for each share of Stock pursuant
to a grant of Restricted Stock or Unrestricted Stock.
2.28 “ Reporting Person
” means a person who is required to file reports under
Section 16(a) of the Exchange Act.
2.29 “ Restricted Stock
” means shares of Stock, awarded to a Grantee pursuant to
Section 10 hereof.
2.30 “Restricted Stock
Unit” means a bookkeeping entry representing the
equivalent of shares of Stock, awarded to a Grantee pursuant to
Section 10 hereof.
2.31 “ SAR Exercise Price
” means the per share exercise price of an SAR granted to a
Grantee under Section 9 hereof.
2.32 “ Section 409A
” shall mean Section 409A of the Code and the
regulations promulgated thereunder.
2.33 “ Securities Act
” means the Securities Act of 1933, as now in effect or as
hereafter amended.
2.34 “Service”
means service as a Service Provider to the Company or an Affiliate.
Unless otherwise stated in the applicable Award Agreement, a
Grantee's change in position or duties shall not result in
interrupted or terminated Service, so long as such Grantee
continues to be a Service Provider to the Company or an Affiliate.
Subject to the preceding sentence, whether a termination of Service
shall have occurred for purposes of the Plan shall be determined by
the Committee, which determination shall be final, binding and
conclusive; provided if any Award governed by Section 409A is to be
distributed on a termination of Service, then the definition of
Service for such purposes shall comply with the definition provided
in Section 409A.
2.35 “ Service Provider
” means an employee, officer or director of the Company or an
Affiliate, or a consultant or adviser currently providing services
to the Company or an Affiliate.
2.36 “ Stock ”
means the class A common stock, par value $.0003 1/3 per share, of
the Company.
2.37 “ Stock Appreciation
Right ” or “ SAR ” means a right
granted to a Grantee under Section 9 hereof.
2.38 “ Subsidiary ”
means any “subsidiary corporation” of the Company
within the meaning of Section 424(f) of the Code.
2.39 “ Termination Date
” means the date upon which an Option shall terminate or
expire, as set forth in Section 8.3 hereof.
2.40 “ Ten Percent Stockholder
” means an individual who owns more than ten percent (10%) of
the total combined voting power of all classes of outstanding stock
of the Company, its parent or any of its Subsidiaries. In
determining stock ownership, the attribution rules of Section
424(d) of the Code shall be applied.
2.41 “ Unrestricted Stock
” means an Award pursuant to Section 11 hereof.
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3.
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ADMINISTRATION OF
THE PLAN
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The
Committee shall have such powers and authorities related to the
administration of the Plan as are consistent with the
Company’s certificate of incorporation and bylaws and
applicable law. The Committee shall have full power and authority
to take all actions and to make all determinations required or
provided for under the Plan, any Award or any Award Agreement, and
shall have full power and authority to take all such other actions
and make all such other determinations not inconsistent with the
specific terms and provisions of the Plan that the Committee deems
to be necessary or appropriate to the administration of the Plan.
The interpretation and construction by the Committee of any
provision of the Plan, any Award or any Award Agreement shall be
final, binding and conclusive. Without limitation, the Committee,
shall have full and final authority, subject to the other terms and
conditions of the Plan, to:
(i) designate
Grantees,
(ii) determine the
type or types of Awards to be made to a Grantee,
(iii) determine the
number of shares of Stock to be subject to an Award,
(iv) establish the
terms and conditions of each Award (including, but not limited to,
the Option Price of any Option, the nature and duration of any
restriction or condition (or provision for lapse thereof) relating
to the vesting, exercise, transfer, or forfeiture of an Award or
the shares of Stock subject thereto, and any terms or conditions
that may be necessary to qualify Options as Incentive Stock
Options),
(v) prescribe the
form of each Award Agreement, and
(vi) amend, modify,
or supplement the terms of any outstanding Award including the
authority, in order to effectuate the purposes of the Plan, to
modify Awards to foreign nationals or are individuals who are
employed outside the United States to recognize differences in
local law, tax policy, or custom.
Notwithstanding the foregoing, no amendment or modification may be
made to an outstanding Option or SAR that (i) that causes the
Option or SAR to become subject to Section 409A, (ii) reduces the
Option Price or SAR Exercise Price, either by lowering the Option
Price or SAR Exercise Price or by canceling the outstanding Option
or SAR and granting a replacement Option or SAR with a lower Option
Price or SAR Exercise Price or (iii) would be treated as a
repricing under the rules of The Nasdaq Stock Market, Inc. or the
otherwise applicable stock exchange without the approval of the
stockholders of the Company, provided, that, appropriate
adjustments may be made to outstanding Options and SARs pursuant to
Section 16 .
The Company may retain the right in an Award Agreement to cause a
forfeiture of the gain realized by a Grantee on account of actions
taken by the Grantee in violation or breach of or in conflict with
any employment agreement, non-competition agreement, any agreement
prohibiting solicitation of employees or clients of the
Company or any Affiliate thereof or any confidentiality obligation
with respect to the Company or any Affiliate thereof or otherwise
in competition with the Company or any Affiliate thereof, to the
extent specified in such Award Agreement applicable to the Grantee.
Furthermore, the Company may annul an Award if the Grantee is an
employee of the Company or an Affiliate thereof and is terminated
for Cause as defined in the applicable Award Agreement or the Plan,
as applicable. The grant of any Award shall be contingent upon the
Grantee executing the appropriate Award Agreement.
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3.2.
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Deferral
Arrangement.
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The Committee may permit or require the deferral of any Award
payment into a deferred compensation arrangement, subject to such
rules and procedures as it may establish and in accordance with
Section 409A, which may include provisions for the payment or
crediting of interest or dividend equivalents, including converting
such credits into deferred Stock equivalents and restricting
deferrals to comply with hardship distribution rules affecting
401(k) plans.
No
member of the Board or of the Committee shall be liable for any
action or determination made in good faith with respect to the
Plan, any Award or Award Agreement.
Notwithstanding any other provision of this Plan to the contrary,
the Company may elect to satisfy any requirement under this Plan
for the delivery of stock certificates through the use of
book-entry.
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4.
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STOCK SUBJECT TO THE
PLAN
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Subject to adjustment as provided in Section
16 hereof, the maximum number of shares of Stock available
for issuance under the Plan shall be 2.7 million. All such shares
of Stock available for issuance under the Plan shall be available
for issuance pursuant to Incentive Stock Options. Stock issued or
to be issued under the Plan shall be authorized but unissued
shares; or, to the extent permitted by applicable law, issued
shares that have been reacquired by the Company.
The Committee may adopt reasonable counting procedures to ensure
appropriate counting, avoid double counting (as, for example, in
the case of tandem or substitute awards) and make adjustments in
accordance with this Section 4 . If the Option
Price of any Option granted under the Plan, or if pursuant to
Section 17.3 the withholding obligation of any Grantee with
respect to an Option or other Award, is satisfied by tendering
shares of Stock to the Company (by either actual delivery or by
attestation) or by withholding shares of Stock, the number of
shares of Stock issued net of the shares of Stock tendered or
withheld shall be deemed delivered for purposes of determining the
maximum number of shares of Stock available for delivery under the
Plan. To the
extent that an Award under the Plan is canceled, expired,
forfeited, settled in cash, settled by issuance of fewer shares
than the number underlying the Award, or otherwise terminated
without delivery of shares to the Grantee, the shares retained by
or returned to the Company will be available under the Plan; and
shares that are withheld from such an Award or separately
surrendered by the Grantee in payment of any exercise price or
taxes relating to such an Award shall be deemed to constitute
shares not delivered to the Grantee and will be available under the
Plan. In addition, in the case of any Award granted in assumption
of or in substitution for an award of a company or business
acquired by the Company or a subsidiary or affiliate or with which
the Company or a subsidiary or affiliate combines, shares issued or
issuable in connection with such substitute Award shall not be
counted against the number of shares reserved under the Plan.
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5.
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EFFECTIVE DATE,
DURATION AND AMENDMENTS
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The
Plan shall be effective as of the Effective Date and shall
terminate automatically as of the first meeting of stockholders at
which directors are to be elected that occurs after the close of
the third calendar year following the calendar year in which the
initial public offering occurs unless the Plan is approved by the
stockholders of the Company prior to such meeting but subsequent to
the Effective Date. In the event that the Plan is approved by the
stockholders during the time prescribed in the preceding sentence,
then the Plan shall terminate automatically on the ten (10) year
anniversary of the Effective Date and may be terminated on any
earlier date as provided in Section 5.2 .
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5.2.
|
Amendment and
Termination of the Plan.
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The
Board may, at any time and from time to time, amend, suspend, or
terminate the Plan as to any Awards which have not been made. An
amendment shall be contingent on approval of the Company’s
stockholders to the extent stated by the Board, required by
applicable law or required by applicable stock exchange listing
requirements. No Awards shall be made after termination of the
Plan. No amendment, suspension, or termination of the Plan shall,
without the consent of the Grantee, impair rights or obligations
under any Award theretofore awarded.
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6.
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AWARD ELIGIBILITY
AND LIMITATIONS
|
|
|
6.1.
|
Service Providers
and Other Persons.
|
Subject to this Section 6 , Awards may be made to: (i) any
Service Provider, including any Service Provider who is an officer
or director of the Company or of any Affiliate, as the Committee
shall determine and designate from time to time, (ii) any Outside
Director, and (iii) any other individual whose participation in the
Plan is determined to be in the best interests of the Company by
the Committee.
An
eligible person may receive more than one Award, subject to such
restrictions as are provided herein.
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6.3.
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Stand-Alone,
Additional, Tandem, and Substitute Awards.
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Awards may, in the discretion of the Committee, be granted either
alone or in addition to, in tandem with, or in substitution or
exchange for, any other Award or any award granted under another
plan of the Company, any Affiliate, or any business entity to be
acquired by the Company or an Affiliate, or any other right of a
Grantee to receive payment from the Company or any Affiliate. Such
additional, tandem, and substitute or exchange Awards may be
granted at any time. If an Award is granted in substitution or
exchange for another Award, the Committee shall have the right to
require the surrender of such other Award in consideration for the
grant of the new Award. The Board shall have the right, in its
discretion, to make Awards in substitution or exchange for any
other award under another plan of the Company, any Affiliate, or
any business entity to be acquired by the Company or an Affiliate.
In addition, Awards may be granted in lieu of cash compensation,
including in lieu of cash amounts payable under other plans of the
Company or any Affiliate, in which the value of Stock subject to
the Award is equivalent in value to the cash compensation (for
example, Restricted Stock Units or Restricted Stock).
Each
Award shall be evidenced by an Award Agreement, in such form or
forms as the Committee shall from time to time determine. Award
Agreements granted from time to time or at the same time need not
contain similar provisions but shall be consistent with the terms
of the Plan. Each Award Agreement evidencing an Award of Options
shall specify whether such Options are intended to be Non-qualified
Stock Options or Incentive Stock Options, and in the absence of
such specification such options shall be deemed Non-qualified Stock
Options.
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8.
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TERMS AND CONDITIONS
OF OPTIONS
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The
Option Price of each Option shall be fixed by the Committee and
stated in the related Award Agreement. The Option Price of each
Option shall be at least the Fair Market Value on the Grant Date of
a share of Stock; provided , however , that (a) in
the event that a Grantee is a Ten Percent Stockholder as of the
Grant Date, the Option Price of an Option granted to such Grantee
that is intended to be an Incentive Stock Option shall be not less
than 110 percent of the Fair Market Value of a share of Stock on
the Grant Date, and (b) with respect to Awards made in substitution
for or in exchange for awards made by an entity acquired by the
Company or an Affiliate, the Option Price does not need to be at
least the Fair Market Value on the Grant Date. In no case shall the
Option Price of any Option be less than the par value of a share of
Stock.
Subject to Section 8.3 hereof, each Option shall become
exercisable at such times and under such conditions as shall be
determined by the Committee and stated in the Award Agreement. For
purposes of this Section 8.2 , fractional
numbers of shares of Stock subject to an Option shall be rounded
down to the next nearest whole number.
Each
Option shall terminate, and all rights to purchase shares of Stock
thereunder shall cease, upon the expiration of ten years from the
Grant Date, or under such circumstances and on such date prior
thereto as is set forth in the Plan or as may be fixed by the
Committee and stated in the related Award Agreement (the
“Termination Date”); provided , however ,
that in the event that the Grantee is a Ten Percent Stockholder, an
Option granted to such Grantee that is intended to be an Incentive
Stock Option at the Grant Date shall not be exercisable after the
expiration of five years from its Grant Date.
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8.4.
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Termination of
Service.
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Each Award Agreement at the Grant Date shall set forth the extent
to which the Grantee shall have the right to exercise the Option
following termination of the Grantee’s Service. Such
provisions shall be determined in the sole discretion of the
Committee, need not be uniform among all Options issued, and may
reflect distinctions based on the reasons for termination of
Service.
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8.5.
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Limitations on
Exercise of Option.
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Notwithstanding any other provision of the Plan, in no event may
any Option be exercised, in whole or in part, (i) prior to the date
the Plan is approved by the stockholders of the Company as provided
herein or (ii) after the occurrence of an event referred to in
Section 16 hereof
