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Exhibit 10.1
Forest City
Enterprises, Inc.
1994 Stock Plan
(As Amended and Restated as of June 19,
2008)
The purpose
of the 1994 Stock Plan (As Amended and Restated as of June 19,
2008) shall be to enhance the attraction, retention and motivation
of Nonemployee Directors and employees, including officers,
executives and other employees who are members of the
Company’s management team who, in the judgment of the
Committee, can contribute materially to the Company’s success
by awarding these employees and Nonemployee Directors the
opportunity to receive Option Rights, Restricted Shares, Restricted
Stock Units, Appreciation Rights and Performance Shares. The Plan
is also intended to foster within these employees and Nonemployee
Directors an identification with ownership and shareholder
interests.
Unless the
context of the applicable section clearly indicates otherwise, the
terms below, when used within the Plan, shall have the meaning set
forth in this Section 2.
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A. |
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APPRECIATION RIGHT means a right granted pursuant to
Section 9 of the Plan, including a Free-standing Appreciation
Right and a Tandem Appreciation Right. |
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B. |
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BASE PRICE means the price to be used as the basis for
determining the Spread upon the exercise of a Free-standing
Appreciation Right. |
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C. |
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BOARD OF DIRECTORS or BOARD means the Board of Directors of the
Company. |
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D. |
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CODE means the Internal Revenue Code of 1986, as amended from
time to time. |
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E. |
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COMPANY means Forest City Enterprises, Inc. |
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F. |
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COMPENSATION COMMITTEE or COMMITTEE means the Compensation
Committee of the Board of Directors, as described in
Section 3-A of the Plan. |
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G. |
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COVERED EMPLOYEE means a Grantee who is, or is determined by
the Committee to be likely to become, a “covered
employee” within the meaning of Section 162(m) of the
Code. |
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H. |
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DATE OF GRANT means the date specified by the Committee on
which a grant of Option Rights or Stock Appreciation Rights or a
grant or sale of Restricted Shares, Restricted Stock Units or
Performance Shares shall become effective, which shall not be
earlier than the date on which the Committee takes action with
respect thereto. |
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I. |
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DEFERRAL PERIOD means the period of time during which
Restricted Stock Units are subject to deferral limitations under
Section 8 of the Plan. |
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J. |
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FREE-STANDING APPRECIATION RIGHT means an Appreciation Right
granted pursuant to Section 9 of the Plan that is not granted
in tandem with an Option Right or similar right. |
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K. |
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GRANTEE means an employee of the Company or a Subsidiary or a
Nonemployee Director to whom an Option Right, Appreciation Right,
or an award of Restricted Shares, Restricted Stock Units or
Performance Shares has been granted under the Plan. |
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L. |
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INCENTIVE STOCK OPTIONS means Option Rights that are intended
to qualify as “Incentive Stock Options” under
Section 422 of the Code or any successor provision. |
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M. |
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MANAGEMENT OBJECTIVES means the measurable performance
objective or objectives established pursuant to the Plan for
Grantees who have received grants of Performance Shares or, when so
determined by the Committee, received grants of Option Rights,
Restricted Shares, Restricted Stock Units or Appreciation Rights
pursuant to the Plan. Management Objectives may be described in
terms of Company-wide objectives or objectives that are related to
the performance of the individual Grantee or of the Subsidiary,
division, department, region or function within the Company or
Subsidiary in which the Grantee is employed. The Management
Objectives may be made relative to the performance of other
companies. The Management Objectives applicable to any Qualified
Performance-Based Award to a Covered Employee shall be based on
specified levels of or growth in or relative to peer company
performance in one or more of the following criteria: |
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(1) |
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Assets ( e.g ., net asset value); |
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(2) |
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Capital ( e.g. , working capital); |
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(3) |
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Cash Flow ( e.g. , EBDT [earnings before depreciation,
amortization and deferred taxes], operating cash flow, total cash
flow, cash flow in excess of cost of capital, residual cash flow or
cash flow return on investment); |
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(4) |
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Liquidity measures ( e.g ., total debt ratio or
debt-to-EBDT,); |
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(5) |
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Margins ( e.g. , profits divided by revenues, operating
margins, gross margins or material margins divided by
revenues); |
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(6) |
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Productivity ( e.g. , productivity improvement); |
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(7) |
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Profits ( e.g. , net income, operating income, EBT
[earnings before taxes], EBIT [earnings before interest and taxes],
EBDT, residual or economic earnings, earnings or EBDT per
share — these profitability criteria could be measured
subject to GAAP definitions); |
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(8) |
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Sales or expenses ( e.g. , revenue growth, reduction in
expenses, sales and administrative costs divided by sales or sales
and administrative costs divided by profits); and |
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(9) |
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Stock price ( e.g. , stock price appreciation or total
shareholder return). |
In addition
to the returns and ratios mentioned above, the Management
Objectives may be based on any other ratios or returns using the
criteria mentioned above, including:
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(1) |
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economic value added, |
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(3) |
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debt-to-capital ratio, |
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(4) |
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working capital divided by sales, and |
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(5) |
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profits or cash flow returns on: assets, designated assets,
invested capital, net capital employed or equity, including: |
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(a) |
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return on net assets, |
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(b) |
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return on capital or invested capital, or |
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(c) |
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total return, meaning change in net asset value plus or minus
net cash flow. |
If the
Committee determines that a change in the business, operations,
corporate structure or capital structure of the Company, or the
manner in which it conducts its business, or other events or
circumstances render the Management Objectives unsuitable, the
Committee may in its discretion modify such Management Objectives
or the related minimum acceptable level of achievement, in whole or
in part, as the Committee deems appropriate and equitable, except
in the case of a Qualified Performance-Based Award where such
action would result in the loss of the otherwise available
exemption under Section 162(m) of the Code. In such case, the
Committee shall not make any modification of the Management
Objectives or minimum acceptable level of achievement.
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N. |
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MARKET VALUE PER SHARE means the fair market value of the
Shares as determined by the Committee from time to time. |
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O. |
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NONEMPLOYEE DIRECTOR means a member of the Board who is not an
employee of the Company or any Subsidiary. |
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P. |
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NONQUALIFIED STOCK OPTIONS means options which do not qualify
as Incentive Stock Options within the meaning of
Section 422(b) of the Code or any successor provision. |
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Q. |
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OPTION PRICE means the purchase price payable upon the exercise
of an Option Right. |
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R. |
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OPTION RIGHT means an option to purchase a Share or Shares upon
exercise of an option granted pursuant to Section 6 of the
Plan. |
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S. |
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PERFORMANCE PERIOD means, in respect of a Performance Share, a
period of time established pursuant to Section 10 of the Plan
within which the Management Objectives relating to such Performance
Share are to be achieved. |
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T. |
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PERFORMANCE SHARE means a bookkeeping entry that records the
equivalent of one Common Share awarded pursuant to Section 10
of the Plan. |
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U. |
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PLAN means the Forest City Enterprises, Inc. 1994 Stock Plan
(As Amended and Restated as of June 19, 2008). |
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V. |
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QUALIFIED PERFORMANCE-BASED AWARD means any award or portion of
an award that is intended to satisfy the requirements for
“qualified performance-based compensation” under
Section 162(m) of the Code. |
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W. |
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RESTRICTED SHARES means Shares granted or sold pursuant to
Section 7 of the Plan as to which neither the substantial risk
of forfeiture nor the prohibition on transfers referred to in such
Section 7 has expired. |
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X. |
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RESTRICTED STOCK UNIT means a bookkeeping entry reflecting an
award made pursuant to Section 8 of the Plan of the right to
receive Shares or cash at the end of a specified Deferral
Period. |
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Y. |
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RETIREMENT means termination of employment with the Company or
a Subsidiary at age 65 or older and after five or more years
of continuous employment with the Company or a Subsidiary. Approved
absence or leave from the Company or a Subsidiary shall not be
considered an interruption of employment for purposes of the
Plan. |
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Z. |
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RULE 16b-3 means Rule 16b-3 of the Securities and Exchange
Commission (or any successor rule to the same effect), as in effect
from time to time. |
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AA. |
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SHARES means shares of the Company’s Class A Common
Stock, $0.33-l/3 par value. |
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BB. |
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SPREAD means, in the case of an Option Right, the excess of the
Market Value per Share of the Shares on the date when Option Rights
are surrendered in payment of the Option Price of other Option
Rights, over the Option Price provided for in the surrendered
Option Right, in the case of a Free-standing Appreciation Right,
the amount by which the Market Value per Share on the date when any
such right is exercised exceeds the Base Price specified in such
right or, in the case of a Tandem Appreciation Right, the amount by
which the Market Value per Share on the date when any such right is
exercised exceeds the Option Price specified in the related Option
Right. |
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CC. |
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SUBSIDIARY means a corporation, company or other entity
(i) more than 50 percent of whose outstanding shares or
securities (representing the right to vote for the election of
directors or other managing authority) are, or (ii) which does
not have outstanding shares or securities (as may be the case in a
partnership, joint venture or unincorporated association), but more
than 50 percent of whose ownership interest representing the
right generally to make decisions for such other entity is, now or
hereafter, owned or controlled, directly or indirectly, by the
Company except that for purposes of determining whether any person
may be a Grantee for purposes of any grant of Incentive Stock
Options, “Subsidiary” means any corporation in which at
the time the Company owns or controls, directly or indirectly, more
than 50 percent of the total combined voting power represented
by all classes of stock issued by such corporation. |
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DD. |
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TANDEM APPRECIATION RIGHT means an Appreciation Right granted
pursuant to Section 9 of the Plan that is granted in tandem
with an Option Right. |
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EE. |
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Wherever used herein, unless indicated otherwise, words in the
masculine form shall be deemed to refer to females as well as to
males. |
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A. |
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COMPENSATION COMMITTEE |
The Plan
shall be administered by the Compensation Committee. The Committee
shall be composed of not less than three members of the Board, each
of whom shall (i) meet all applicable independence
requirements of the New York Stock Exchange, or if the Shares are
not traded on the New York Stock Exchange, the principal national
securities exchange on which the Shares are traded, (ii) be a
“nonemployee director” within the meaning of
Rule 16b-3 and (iii) be an “outside director”
within the meaning of Section 162(m) of the Code. A majority
of the Committee shall constitute a quorum, and the acts of the
members of the Committee who are present at any meeting thereof at
which a quorum is present, or acts unanimously approved by the
members of the Committee in writing, shall be the acts of the
Committee.
Within the
limits of the provisions of the Plan, the Committee shall have the
plenary authority to determine (i) the employees to whom
awards hereunder shall be granted, (ii) the number of shares
subject to each award under the Plan; provided that, if the award
is an incentive stock option, the aggregate fair market value of
the shares (as determined at the time the option is granted) which
become exercisable in any calendar year for any employee shall not
exceed $100,000, (iii) the form (Incentive Stock Options,
Nonqualified Stock Options, Restricted Shares, Restricted Stock
Units, Appreciation Rights or Performance Shares) and amount of
each award granted, (iv) the provisions of each agreement
relating to an award under the Plan, and (v) the limitations,
restrictions and conditions applicable to any such award. In making
such awards the Committee shall take into consideration the
performance of each eligible employee and Nonemployee Director. The
determinations of the Committee on all matters regarding the Plan
shall be final and conclusive.
Subject to
the provisions of the Plan, the Committee may interpret the Plan,
and prescribe, amend and rescind rules and regulations relating to
it. The interpretation of any provision of the Plan by the
Committee shall be final and conclusive.
All awards
under the Plan may be granted under the Plan to employees of the
Company or any Subsidiary and Nonemployee Directors, as determined
by the Committee, based upon the Committee’s evaluation of
employees’ and Nonemployee Directors’ duties and their
overall performance including current and potential contributions
to the Company’s success. Generally, the group of eligible
employees includes officers, senior executives, directors who are
also employees, and any other members of the Company’s
management team or other employees deemed appropriate by the
Committee. All determinations by the Committee as to the identity
of persons eligible to be granted awards hereunder shall be
conclusive.
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SHARE AWARDS UNDER THE PLAN |
Awards
under the Plan shall be granted in the form of Incentive Stock
Options, Nonqualified Stock Options, Restricted Shares, Restricted
Stock Units, Appreciation Rights or Performance Shares as herein
defined in Section 2.
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B. |
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SHARES SUBJECT TO THE PLAN |
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(i) |
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The aggregate number of Shares that may be issued or
transferred (a) upon the exercise of Option Rights or
Appreciation Rights, (b) as Restricted Shares (and released
from all substantial risks of forfeiture), (c) upon the
vesting of Restricted Stock Units or (d) in payment of
Performance Shares that have been earned under the Plan during the
term of the Plan may not exceed 12,750,000 (1,000,000 of which are
being added by this June 19, 2008 amendment and restatement of
the Plan) Shares (plus any Shares relating to awards that expire or
are forfeited or cancelled), subject to adjustments described in
Section 12-A. Such Shares may be Shares of original issuance
or treasury shares or a combination of the foregoing. |
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(ii) |
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Shares covered by an award granted under the Plan shall not be
counted as used unless and until they are actually issued and
delivered to a Grantee. Without limiting the generality of the
foregoing, if any portion of the benefit provided by an award
granted under the Plan is paid in cash, the Shares that were
covered by that award will, to the extent settled in cash, be
available for issue or transfer hereunder. Notwithstanding anything
to the contrary contained in the foregoing provisions of this
Section 5-B: (a) Shares tendered in payment of the Option
Price of an Option Right shall not be added to the aggregate plan
limit described above; (b) Shares withheld by the Company to
satisfy tax withholding obligations shall not be added to the
aggregate plan limit described above; (c) Shares that are
repurchased by the Company with Option Right proceeds shall not be
added to the aggregate plan limit described above; and (d) all
Shares covered by an Appreciation Right, to the extent that it is
exercised and settled in Shares, shall be considered issued or
transferred pursuant to the Plan. |
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(iii) |
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Notwithstanding anything in this Section 5-B, or elsewhere
in this Plan, to the contrary and subject to adjustment as provided
in Section 12-A of this Plan: |
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(a) |
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The aggregate number of Shares actually issued or transferred
by the Company upon the exercise of Incentive Stock Options will
not exceed 12,750,000 Shares. |
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(b) |
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No Grantee will be granted Option Rights or Free-standing
Appreciation Rights, in the aggregate, for more than 400,000 Shares
during any calendar year. |
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(c) |
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No Grantee will be granted Qualified Performance-Based Awards
of Restricted Shares or Restricted Stock Units, in the aggregate,
for more than 225,000 Shares in any calendar year. |
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(d) |
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The number of Shares issued as Restricted Shares (after taking
any forfeiture into account) or in payment of Restricted Stock
Units or Performance Shares will not in the aggregate exceed
2,500,000. |
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(e) |
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No Grantee will be granted Qualified Performance-Based Awards
of Performance Shares, in the aggregate, for more than 100,000
Shares in any calendar year. |
The
Committee may, from time to time and upon such terms and conditions
as it may determine, authorize the granting to eligible employees
or Nonemployee Directors of options to purchase Shares. Each such
grant may utilize any or all of the authorizations, and shall be
subject to all of the requirements, contained in the following
provisions:
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A. |
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Each grant shall specify the number of Shares to which it
pertains subject to the limitations set forth in Section 5-B
of the Plan. |
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B. |
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Each grant shall specify an Option Price per Share, which may
not be less than the Market Value per Share on the Date of
Grant. |
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C. |
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Each grant shall specify whether the Option Price shall be
payable (i) in cash or by check acceptable to the Company,
(ii) by the actual or constructive transfer t |
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