Exhibit 3.1
THE MENS WEARHOUSE, INC.
THIRD
AMENDED AND RESTATED
BYLAWS
(As Amended and Restated effective June 25, 2008)
Article I
Offices
Section 1.01.
Principal Place of Business.
The principal place of business of the corporation
may be located within or without the State of Texas as the board of directors may from time to time determine.
Section 1.02.
Other Offices.
The corporation may also have offices at such other places both
within and without the State of Texas as the board of directors may from time to time determine or
the business of the corporation may require.
Article II
Meetings of Shareholders
Section 2.01.
Time and Place of Meetings.
Meetings of shareholders for any purpose may be
held at such time and place within or without the State of Texas as shall be stated in the notice
of the meeting or in a duly executed waiver of notice thereof and, if authorized by the board of
directors may be held by remote communications.
Section 2.02.
Annual Meeting.
The annual meeting of shareholders shall be held annually at
such date and time as shall be designated from time to time by the board of directors and stated in
the notice of meeting.
Section 2.03.
Special Meetings.
Special meetings of the shareholders for any purpose or
purposes may be called by the chairman of the board or the president and shall be called by the
president or secretary at the request in writing of a majority of the board of directors, or at the
request in writing of shareholders owning at least ten percent of all the shares entitled to vote
at the meetings. A request for a special meeting shall state the purpose or purposes of the
proposed meeting, and business transacted at any special meeting of shareholders shall be limited
to the purposes stated in the notice.
Section 2.04.
Notice of Meeting.
Written notice stating the place, day and hour of the
meeting, the means of any remote communications by which shareholders may be considered present and
may vote at the meeting and, in the case of a special meeting, the purpose or purposes for which
the meeting is called, shall be delivered not less than ten nor more than sixty days before the
date of the meeting, either personally, by electronic transmission or by mail, by or at the
direction of the chairman of the board, the president, the secretary, or the officer or persons
calling the meeting, to each shareholder entitled to vote at such meeting. If mailed, such notice
shall be deemed to be delivered when deposited in the United States mail addressed to the
shareholder at his address as it appears on the stock transfer books of the corporation, with
postage thereon prepaid.
Section 2.05. Procedures with Respect to Matters to be Considered at a Meeting.
(A)
Annual Meetings of Shareholders
.
(1) Nominations of persons for election to the board of directors and the proposal of business
to be considered by the shareholders may be made at an annual meeting of shareholders only (a)
pursuant to the corporations notice of meeting (or any supplement thereto), (b) by or at the
direction of the board of directors, or (c) by any shareholder of the corporation who (i) was a
shareholder of record of the corporation at the time the notice provided for in this Section 2.05
of Article II is delivered to the Secretary of the corporation and at the time of the annual
meeting, (ii) shall be entitled to vote at such meeting, and (iii) complies with the notice
procedures set forth in this Section 2.05 of Article II as to such nomination or business. Clause
(c) shall be the exclusive means for a shareholder to make nominations or submit business (other
than matters properly brought under Rule 14a-8 (or any successor thereto) under the Securities
Exchange Act of 1934, as amended (the
Exchange Act
) and indicated in the corporations notice of
meeting) at an annual meeting of shareholders.
(2) Without qualification, for nominations or any other business to be properly brought before
an annual meeting by a shareholder pursuant to Section 2.05(A)(1)(c) of Article II, the
shareholder, in addition to any other applicable requirements, must have given timely notice
thereof in writing to the Secretary of the corporation and any such proposed business must
constitute a proper matter for shareholder action. To be timely, a shareholders notice must be
delivered to the Secretary of the corporation at the principal executive offices of the corporation
not later than the close of business on the ninetieth (90th) day nor earlier than the close of
business on the one hundred twentieth (120th) day prior to the first anniversary of the preceding
years annual meeting (provided, however, that in the event that the date of the annual meeting is
more than thirty days before or more than sixty (60) days after such anniversary date, notice by
the shareholder must be so delivered not earlier than the close of business on the one hundred
twentieth (120th) day prior to such annual meeting and not later than the close of business on the
later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following
the day on which public announcement of the date of such meeting is first made by the corporation).
In no event shall the public announcement of an adjournment or postponement of the annual meeting
of shareholders commence a new time period (or extend any time period) for the giving of a
shareholders notice as described above. To be in proper form, a shareholders notice to the
Secretary (whether pursuant to this Section 2.05(A)(2) of Article II or Section 2.05(B) of Article
II) shall set forth:
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(a) as to each person, if any, whom the shareholder proposes to
nominate for election as a director (i) all information relating to such
person that is required to be disclosed in solicitations of proxies for
election of directors in an election contest, or is otherwise required, in
each case pursuant to and in accordance with Section 14 of the Exchange Act
and the rules and regulations promulgated thereunder, (ii) such persons
written consent to being named in the proxy statement as a nominee and to
serving as a director if elected, and (iii) include a completed and signed
questionnaire, representation and agreement required by Section 2.06 of this
Article II;
(b) if the notice relates to any business (other than the nomination of
persons for election as directors) that the shareholder proposes to bring
before the meeting, (i) a brief description of the business desired to be
brought before the annual meeting, (ii) the reasons for conducting such
business at the annual meeting, (iii) the text of the proposal or business
(including the text of any resolutions proposed for consideration and in the
event that such business includes a proposal to amend the Bylaws of the
corporation, the language of the proposed amendment), (iv) any material
interest in such business of such shareholder and the beneficial owner, if
any, on whose behalf the proposal is made, and (v) a description of all
agreements, arrangements and understandings between such shareholder and
beneficial owner, if any, and any other person or persons (including their
names) in connection with the proposal of such business by such shareholder;
and
(c) as to the shareholder giving the notice and the beneficial owner,
if any, on whose behalf the nomination or proposal is made (i) the name and
address of such shareholder, as they appear on the corporations books, and
of such beneficial owner, if any, (ii)(A) the class or series and number of
shares of capital stock of the corporation that are, directly or indirectly,
owned beneficially or of record by such shareholder and by such beneficial
owner, (B) the existence and material terms of any proxy, contract,
arrangement, understanding, or relationship pursuant to which such
shareholder or beneficial owner, if any, has a right to vote any shares of
any security of the corporation (including, if applicable, any contract,
arrangement, understanding or relationship pursuant to which any economic
interest in the capital stock to be voted is beneficially owned by a person
or persons other than the shareholder of record as of the record date), (C)
any short interest in any security of the corporation (for purposes of this
Section 2.05 of Article II, a person shall be deemed to have a short
interest in a security if such person directly or indirectly, through a
contract, arrangement, understanding, relationship or otherwise, has the
opportunity to profit or share in any profit derived from any decrease in
the value of the subject security), in each case with respect to the
information required to be included in the notice pursuant to (A) through
(C) above, as of the date of such notice and including, without
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limitation, any such interests held by members of such shareholders or
such beneficial owners immediate family sharing the same household, (iii)
any other information relating to such shareholder and beneficial owner, if
any, that would be required to be disclosed in a proxy statement or other
filings required to be made in connection with solicitation of proxies for
election of directors in a contested election pursuant to Section 14 of the
Exchange Act and the rules and regulations promulgated thereunder, (iv) a
representation that the shareholder is a holder of record of stock of the
corporation entitled to vote at such meeting and intends to appear in person
or by proxy at the meeting to propose such business or nomination, and (v) a
representation whether the shareholder or the beneficial owner, if any,
intends or is part of a group that intends (a) to deliver a proxy statement
or form of proxy to holders of at least the percentage of the corporations
outstanding capital stock required to approve or adopt the proposal or elect
the nominees or (b) otherwise to solicit proxies from shareholders in
support of such proposal or nomination.
The corporation may require any proposed nominee to furnish such other information as it may
reasonably require (i) to determine the eligibility of such proposed nominee to serve as a director
of the corporation, (ii) to determine whether such nominee qualifies as an independent director
or audit committee financial expert under applicable law, securities exchange rule or regulation,
or any publicly-disclosed corporate governance guideline or committee charter of the corporation;
and (iii) that could be material to a reasonable shareholders understanding of the independence
and qualifications, or lack thereof, of such nominee.
(3) Notwithstanding anything in the second sentence of paragraph (A)(2) of this Section 2.05
to the contrary, in the event that the number of directors to be elected to the board of directors
of the corporation at an annual meeting is increased and there is no public announcement by the
corporation naming all of the nominees for director or specifying the size of the increased board
of directors at least one hundred (100) days prior to the first anniversary of the preceding years
annual meeting, a shareholders notice required by this Section 2.05 shall also be considered
timely, but only with respect to nominees for any new positions created by such increase, if it
shall be delivered to the Secretary of the corporation at the principal executive offices of the
corporation not later than the close of business on the tenth (10th) day following the day on which
such public announcement is first made by the corporation.
(B)
Special Meetings of Shareholders
. Only such business shall be conducted at a
special meeting of shareholders as shall have been brought before the meeting pursuant to the
corporations notice of meeting. Nominations of persons for election to the Board of Directors may
be made at a special meeting of shareholders at which directors are to be elected pursuant to the
corporations notice of meeting (1) by or at the direction of the Board of Directors or (2)
provided that the Board of Directors has determined that the directors shall be elected at such
meeting, by any shareholder of the corporation who is a shareholder of record at the time the
notice provided for in this Section 2.05 is delivered to the Secretary of the corporation and at
the time of the special meeting, who is entitled to vote at the meeting and
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upon such election, and who complies with the notice procedures set forth in this Section
2.05. In the event the corporation calls a special meeting of shareholders for the purpose of
electing one or more directors to the Board of Directors, any such shareholder entitled to vote in
such election of directors may nominate a person or persons (as the case may be) for election to
such position(s) as specified in the corporations notice of meeting, if the shareholders notice
in the same form as required by paragraph (A)(2) of this Section 2.05 with respect to any
nomination (including the completed and signed questionnaire, representation and agreement required
by Section 2.06 of this Article II) shall be delivered to the Secretary at the principal executive
offices of the corporation not earlier than the close of business on the one hundred twentieth
(120th) day prior to such special meeting and not later than the close of business on the later of
the ninetieth (90th) day prior to such special meeting or the tenth (10th) day following the day on
which public announcement is first made of the date of the special meeting and of the nominees
proposed by the board of directors to be elected at such meeting. In no event shall the public
announcement of an adjournment or postponement of a special meeting commence a new time period (or
extend any time period) for the giving of a shareholders notice as described above.
(C)
General
.
(1) Only such persons who are nominated in accordance with the procedures set forth in this
Section 2.05 of Article II shall be eligible to be elected at an annual or special meeting of
shareholders of the corporation to serve as directors and only such business shall be conducted at
a meeting of shareholders as shall have been brought before the meeting in accordance with the
procedures set forth in this Section 2.05 of Article II. Except as otherwise provided by law, the
Articles of Incorporation of the corporation, as amended (the
Articles of Incorporation
) or these
Bylaws, the Chairman of the meeting shall have the power and duty (a) to determine whether a
nomination or any business proposed to be brought before the meeting was made or proposed, as the
case may be, in accordance with the procedures set forth in this Section 2.05 of Article II and (b)
if any proposed nomination or business was not made or proposed in compliance with this Section
2.05 of Article II, in the reasonable judgment of the Chairman of the meeting under the
circumstances existing at the time and given the information available to the Chairman, to declare
that such nomination shall be disregarded or that such proposed business shall not be transacted.
Notwithstanding the foregoing provisions of this Section 2.05 of Article II, unless otherwise
required by law, if the shareholder (or a qualified representative of the shareholder) does not
appear at the annual or special meeting of shareholders of the corporation to present a nomination
or proposed business, such nomination shall be disregarded and such proposed business shall not be
transacted, notwithstanding that proxies in respect of such vote may have been received by the
corporation. For purposes of this Section 2.05 of Article II, to be considered a qualified
representative of the shareholder, a person must be authorized by a writing executed by such
shareholder or an electronic transmission delivered by such shareholder to act for such shareholder
as proxy at the meeting of shareholders and such person must produce such writing or electronic
transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting
of the shareholders.
(2) For purpose of this Section 2.05 of Article II, public announcement shall include
disclosure in a press release reported by the Dow Jones News Service, Associated Press, or
comparable national news service or in a document publicly filed
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by the corporation with the Securities and Exchange Commission pursuant to Section 13, 14, or
15(d) of the Exchange Act and the rules and regulations promulgated thereunder.
(3) Nothing in this Section 2.05 of Article II, shall be deemed to affect any rights (a) of
shareholders to request inclusion of proposals or nominations in the corporations proxy statement
pursuant to Rule 14a-8 (or any successor thereto) promulgated under the Exchange Act or (b) of the
holders of any series of preferred stock to nominate and elect directors pursuant to and to the
extent provided in any applicable provisions of the Articles of Incorporation.
Section 2.06. Submission of Questionnaire, Representation and Agreement
. To be eligible to
be a nominee for election or reelection as a director of the corporation (other than a nominee
nominated pursuant to Section 2.05A(1)(a) or (b) or Section 2.05B(1) of Article II), a person must
deliver (in accordance with the time periods prescribed for delivery of notice under Section 2.05
of Article II of these Bylaws) to the Secretary at the principal executive offices of the
corporation a written questionnaire with respect to the background and qualification of such person
and the background of any other person or entity on whose behalf the nomination is being made
(which questionnaire shall be provided by the Secretary upon written request) and a written
representation and agreement (in the form provided by the Secretary upon written request) that such
person (A) is not and will not become a party to (1) any agreement, arrangement or understanding
with, and has not given any commitment or assurance to, any person or entity as to how such person,
if elected as a director of the corporation, will act or vote on any issue or question (a
Voting
Commitment
) that has not been disclosed to the corporation or (2) any Voting Commitment that could
limit or interfere with such persons ability to comply, if elected as a director of the
corporation, with such persons fiduciary duties under applicable law, (B) is not and will not
become a party to any agreement, arrangement or understanding with any person or entity other than
the corporation with respect to any direct or indirect compensation, reimbursement or
indemnification in connection with service or action as a director that has not been disclosed
therein, and (C) in such persons individual capacity and on behalf of any person or entity on
whose behalf the nomination is being made, would be in compliance, if elected as a director of the
corporation, and will comply with all applicable publicly disclosed corporate governance, conflict
of interest, confidentiality and stock trading policies and guidelines of the corporation.
Section 2.07.
Quorum.
The holders of a majority of the shares issued and outstanding and
entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at
all meetings of the shareholders for the transaction of business except as otherwise provided by
statute or by the articles of incorporation. If, however, a quorum shall not be present or
represented at any meeting of the shareholders, the shareholders entitled to vote thereat, present
in person or represented by proxy, shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum shall be present or
represented. After an adjournment, at any reconvened meeting any business may be transacted that
might have been transacted if the meeting had been held in accordance with the original notice
thereof, provided a quorum shall be present or represented thereat.
Section 2.08.
Vote Required.
With respect to any matter, other than the election of directors
or a matter for which a different vote is required by law or the articles of incorporation,
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the affirmative vote of the holders of a majority of the shares entitled to vote on, and that
voted for or against or expressly abstained with respect to, that matter at a meeting of
shareholders at which a quorum is present shall be the act of the shareholders. Unless otherwise
required by law or by the articles of incorporation, directors shall be elected by a plurality of
the votes cast by the holders of shares entitled to vote in the election of directors at a meeting
of shareholders at which a quorum is present.
Section 2.09.
Voting; Proxies.
Each outstanding share having voting power shall be entitled
to one vote on each matter submitted to a vote at a meeting of shareholders, except to the extent
provided otherwise in the Articles of Incorporation or in the Texas Business Corporation Act (the
Act). Any shareholder may vote either in person or by proxy executed in writing by the
shareholder. A telegram, telex, cablegram or other form of electronic transmission, including
telephone transmissions by the shareholder, or a photographic, photostatic, facsimile or similar
reproduction of a writing executed by the shareholder shall be treated as an execution in writing
for purposes of this Section 2.09.
Section 2.10.
Action Without Meeting.
Any action required to, or which may, be taken at any
annual or special meeting of shareholders may be taken without a meeting, without prior notice and
without a vote, if a consent or consents in writing, setting forth the action so taken shall be
signed by the holder or holders of all the shares entitled to vote with respect to the action that
is the subject of the consent.
Article III
Directors
Section 3.01.
Powers.
The powers of the corporation shall be exercised by or under the
authority of, and the business and affairs of the corporation shall be managed under the direction
of, the board of directors.
Section 3.02.
Number, Election and Term.
The number of directors that shall constitute the
whole board of directors shall be not less than one. Such number of directors shall from time to
time be fixed and determined by resolution adopted by the directors and shall be set forth in the
notice of any meeting of shareholders held for the purpose of electing directors. The directors
shall be elected at the annual meeting of shareholders, except as provided in Section 3.03 of these
bylaws, and each director elected shall hold office until his successor shall be elected and
qualify. Directors need not be residents of Texas or shareholders of the corporation.
Section 3.03.
Vacancies.
Any vacancy occurring in the board of directors may be filled by a
majority of the remaining directors though less than a quorum of the board of directors. A
director elected to fill a vacancy shall be elected for the unexpired term of his predecessor in
office.
Section 3.04.
Change in Number.
The number of directors may be increased or decreased from
time to time as provided in these bylaws but no decrease shall have the effect of shortening the
term of any incumbent director. Any directorship to be filled by reason of an increase in the
number of directors may be filled by election at an annual or special meeting of
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shareholders or may be filled by the board of directors for a term of office continuing only
until the next election of one or more directors by the shareholders; provided, however, that the
board of directors may not fill more than two such directorships during the period between any two
successive annual meetings of shareholders.
Section 3.05.
Removal.
Any director may be removed for cause at any special meeting of
shareholders duly called and held for such purpose. At any meeting of shareholders called
expressly for the purpose of removing a director or directors, such director or directors may be
removed only for cause by a vote of a majority of the shares of stock of the corporation then
entitled to vote at an election of directors.
Section 3.06.
Place of Meetings.
Meetings of the board of directors, regular or special, may
be held either within or without the State of Texas.
Section 3.07.
Regular Meetings.
The first meeting of each newly elected board of directors
shall be held at such time and place as shall be fixed by the vote of the shareholders at the
annual meeting and no notice of such meeting shall be necessary to the newly elected directors in
order legally to constitute the meeting, provided a quorum shall be present. In the event that the
shareholders fail to fix the time and place of such first meeting, it shall be held without notice
immediately following the annual meeting of shareholders, and at the same place, unless by the
unanimous consent of the directors then elected and serving such time or place shall be changed.
Section 3.08.
Notice of Regular Meetings.
Regular meetings of the board of directors may be
held upon such notice, or without notice, and at such time and at such place as shall from time to
time be determined by the board.
Section 3.09.
Special Meetings.
Special meetings of the board of directors may be called by
the chairman of the board of directors or the president and shall be called by the secretary on the
written request of two directors. Notice of each special meeting of the board of directors shall
be given to each director at least two days before the date of the meeting.
Section 3.10.
Waiver and Requirements of Notice.
Attendance of a director at any meeting
shall constitute a waiver of notice of such meeting, except where a director attends for the
express purpose of objecting to the transaction of any business on the ground that the meeting is
not lawfully called or convened. Except as may be otherwise provided by law or by the articles of
incorporation or by these bylaws, neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the board of directors need be specified in the notice or waiver of
notice of such meeting.
Section 3.11.
Quorum; Vote Required.
At all meetings of the board of directors a majority of
the directors shall constitute a quorum for the transaction of business and the act of a majority
of the directors present at any meeting at which there is a quorum shall be the act of the board of
directors, unless otherwise specifically provided by law, the articles of incorporation or these
bylaws. If a quorum shall not be present at any meeting of directors, the directors present
thereat may adjourn the meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present.
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Section 3.12.
Committees.
The board of directors, by resolution passed by a majority of the
full board, may from time to time designate a member or members of the board to constitute
committees that shall in each case consist of one or more directors and may designate one or more
of its members as alternate members of any committee, who may, subject to any limitations imposed
by the board of directors, replace absent or disqualified members at any meeting of that committee.
Any such committee shall have and may exercise such powers as the board may determine and specify
in the respective resolutions appointing them. A majority of all the members of any such committee
may determine its action and fix the time and place of its meetings, unless the board of directors
shall otherwise provide. The board of directors shall have power at any time to change the number,
subject as aforesaid, and members of any such committee, to fill vacancies and to discharge any
such committee.
Section 3.13.
Action Without Meeting.
Any action required or permitted to be taken at a
meeting of the board of directors or any committee may be taken without a meeting if a consent in
writing, setting forth the action so taken, is signed by all the members of the board of directors
or committee, as the case may be.
Section 3.14.
Compensation.
By resolution of the board of directors, the directors may be
paid their expenses, if any, of attendance at each meeting of the board of directors, or a meeting
of a committee thereof, and may be paid a fixed sum for attendance at each meeting of the board of
directors, or a meeting of a committee thereof, or a stated salary as director. No such payment
shall preclude any director from serving the corporation in any other capacity and receiving
compensation therefor.
Article IV
Notices
Section 4.01.
Form of Notice; Delivery.
Any notice to directors or shareholders shall be in
writing and shall be delivered personally or mailed to the directors or shareholders at their
respective addresses appearing on the books of the corporation. Notice by mail shall be deemed to
be given at the time when the same shall be deposited in the United States mail, postage prepaid.
Notice to directors may also be given by telegram, telex, cablegram, facsimile or other similar
transmission.
Section 4.02.
Waiver.
Whenever any notice is required to be given under the provisions of the
statutes or of the articles of incorporation or of these bylaws, a waiver thereof in writing signed
by the person or persons entitled to such notice, whether before or after the time stated therein,
shall be deemed equivalent to the giving of such notice.
Article V
Officers
Section 5.01.
Officers.
The officers of the corporation shall be elected by the board of
directors and shall consist of a chairman of the board, a president and a secretary and may consist
of a chief operating officer, one or more vice presidents, a treasurer, an assistant treasurer and
an
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assistant secretary, who need not be members of the board of directors. Two or more offices
may be held by the same person.
Section 5.02.
Additional Officers.
The board of directors may appoint such other officers and
assistant officers and agents as it shall deem necessary, who shall hold their offices for such
terms and shall have such authority and exercise such powers and perform such duties as shall be
determined from time to time by the board by resolution not inconsistent with these bylaws.
Section 5.03.
Compensation.
The salaries and terms of employment of the chairman of the
board, the president and the chief operating officer, if any, of the corporation shall be fixed by
the board of directors. The board of directors shall have the power to cause the corporation to
enter into contracts for the employment and compensation of officers for such terms as the board
deems advisable.
Section 5.04.
Term; Removal; Vacancies.
The officers of the corporation shall hold office
until their successors are elected or appointed and qualify, or until their death or until their
resignation or removal from office. Any officer elected or appointed by the board of directors may
be removed at any time by the board, but such removal shall be without prejudice to the contract
rights, if any, of the person so removed. Election or appointment of an officer or agent shall not
of itself create contract rights. Any vacancy occurring in any office of the corporation by death,
resignation, removal or otherwise shall be filled by the board of directors.
Section 5.05.
Chief Executive Officer.
The chairman of the board shall be the chief executive
officer of the corporation, unless the board of directors designates the president as the chief
executive officer of the corporation. The chief executive officer shall preside at all meetings of
shareholders, shall have general and active management of the business of the corporation, and
shall see that all resolutions of the board of directors are carried into effect. The board of
directors may change the designation of chief executive officer at any time, but no such change
shall constitute removal of any person from the office of chairman of the board or president, as
the case may be. If the chairman of the board shall be chief executive officer, then in the
absence or disability of the chairman of the board, the president shall perform the duties and have
the authority of the chief executive officer. If the president shall have been last designated as
chief executive officer, then in the absence or disability of the president, the chairman of the
board shall perform the duties and have the authority of the chief executive officer.
Section 5.06.
Chairman of the Board.
The chairman of the board, if one is elected, shall
preside at all meetings of the board of directors and shall have such other powers and duties as
may from time to time be prescribed by the board of directors, upon written directions given to him
pursuant to resolutions duly adopted by the board of directors. The chairman of the board shall be
the chief executive officer of the corporation, except as set forth in Section 5.05 of these bylaws
Section 5.07.
Vice Chairman of the Board.
The vice chairman of the board, if one is elected,
shall, in the absence or disability of the chairman of the board, perform the duties and have the
authority and exercise the powers of the chairman of the board. He shall perform such
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other duties and have such other authority and powers as the board of directors may from time
to time prescribe or as the chairman of the board may from time to time delegate.
Section 5.08.
President.
The president shall have general supervision over strategic planning
and implementation, administration and the accounting and finance operations of the corporation,
and shall see that all resolutions of the board of directors are carried into effect. The
president shall be the principal executive officer of the corporation for purposes of all filings
by the corporation with the Securities and Exchange Commission. Unless the board of directors
shall have designated a particular vice president of the corporation as principal financial
officer, the president shall also be the principal financial officer of the corporation for
purposes of all filings by the corporation with the Securities and Exchange Commission. The
president shall have such other duties as may be determined from time to time by resolution of the
board of directors not inconsistent with these bylaws. If the president shall have been last
designated as chief executive officer, he also shall have the authority and perform the duties
appertaining to that designation, as specified in Section 5.05 of these bylaws. The president, in
the absence or incapacity of the chief operating officer, shall also perform the duties of that
office.
Section 5.08A.
Chief Operating Officer
.
The chief operating officer of the corporation, if
one is elected, shall report to the chief executive officer and the president of the corporation
and shall have general supervision of the day-to-day operation of retail activities of the
corporation and shall perform such duties, and shall have such other authority and powers, as the
president, the chief executive officer or the board of directors may from time to time prescribe.
The chief operating officer, with the approval of either the chief executive officer or the
president, shall have authority to execute instruments, documents, agreements and contracts, in the
name of the corporation, to the same extent as the president or any vice president of the
corporation.
Section 5.09.
Vice Presidents.
The vice presidents in the order of their seniority, unless
otherwise determined by the board of directors, shall, in the absence or disability of the
president, perform the duties and have the authority and exercise the powers of the president.
They shall perform such other duties and have such other authority and powers as the board of
directors may from time to time prescribe or as the chairman of the board or the president may from
time to time delegate. The board of directors may, at the time of election of any vice president
of the corporation, designate such vice president a senior vice president or executive vice
president of the corporation or designate such vice president by reference to a principal business
function, such as finance or administration.
Section 5.10.
Secretary.
The secretary shall attend all meetings of the board of directors
and all meetings of shareholders and record all of the proceedings of the meetings of the board of
directors and of the shareholders in a minute book to be kept for that purpose and shall perform
like duties for the standing committees when required. He shall give, or cause to be given, notice
of all meetings of the shareholders and special meetings of the board of directors, and shall
perform such other duties as may be prescribed by the board of directors or president, under whose
supervision he shall be. He shall keep in safe custody the seal of the corporation and, when
authorized by the board of directors, shall affix the same to any instrument requiring it and, when
so affixed, it shall be attested by his signature or by the signature of an assistant secretary or
of the treasurer. The secretary shall perform such other duties and have such other powers as
11
the board of directors may from time to time prescribe or as the chairman of the board or the
president may from time to time delegate.
Section 5.11.
Assistant Secretaries.
The assistant secretaries in the order of their
seniority, unless otherwise determined by the board of directors, shall, in the absence or
disability of the secretary, perform the duties and exercise the powers of the secretary. They
shall perform such other duties and have such other powers as the board of directors may from time
to time prescribe or as the chairman of the board or the president may from time to time delegate.
Section 5.12.
Treasurer.
The treasurer, if one is elected, shall have custody of the
corporate funds and securities and shall keep full and accurate accounts and records of receipts,
disbursements and other transactions in books belonging to the corporation, and shall deposit all
moneys and other valuable effects in the name and to the credit of the corporation in such
depositories as may be designated from time to time by the board of directors. The treasurer shall
disburse the funds of the corporation as may be ordered by the board of directors, taking proper
vouchers for such disbursements, and shall render the president and the board of directors, at its
regular meetings, or when the president or board of directors so requires, an account of all his
transactions as treasurer and of the financial condition of the corporation. The treasurer shall
perform such other duties and have such other powers as the board of directors may from time to
time prescribe or as the chairman of the board or the president may from time to time delegate. If
required by the board of directors, the treasurer shall give the corporation a bond of such type,
character and amount as the board of directors may require.
Section 5.13.
Assistant Treasurers.
The assistant treasurers in the order of their seniority,
unless otherwise determined by the board of directors, shall, in the absence or disability of the
treasurer, perform the duties and exercise the powers of the treasurer. They shall perform such
other duties and have such other powers as the board of directors may from time to time prescribe
or the chairman of the board or the president may from time to time delegate.
Article VI
Certificates Representing Shares
Section 6.01.
Certificates.
The shares of the corporation may be represented by certificates
or may be uncertificated. Every holder of shares of the corporation shall be entitled to have a
certificate, in such form as shall be approved by the board of directors, certifying the number of
fully-paid shares owned by such holder. Certificates representing shares shall be signed by the
president of a vice president and the secretary or an assistant secretary of the corporation, and
may be sealed with the seal of the corporation or a facsimile thereof.
Section 6.02.
Facsimile Signatures.
The signatures of the president or a vice president and
the secretary or an assistant secretary upon a certificate may be facsimiles if the certificate is
countersigned by a transfer agent or registered by a registrar other than the corporation or an
employee of the corporation. In case any officer who has signed or whose facsimile signature has
been placed upon such certificate shall have ceased to be such officer before such certificate
12
is issued, it may be issued by the corporation with the same effect as if he were such officer
at the date of its issue.
Section 6.03.
Lost Certificates.
The board of directors may direct a new certificate, or
uncertificated shares, to be issued in place of any certificate theretofore issued by the
corporation alleged to have been lost or destroyed. When authorizing such issue of a new
certificate, or uncertificated shares, the board of directors, in its discretion and as a condition
precedent to the issuance thereof, may prescribe such terms and conditions as it deems expedient
and may require such indemnities as it deems adequate to protect the corporation from any claim
that may be made against it with respect to any such certificate alleged to have been lost or
destroyed.
Section 6.04.
Transfers.
In the case of shares represented by a certificate, upon surrender
to the corporation or the transfer agent of the corporation of a certificate representing shares
duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer,
a new certificate, or uncertificated shares, shall be issued to the person entitled thereto and the
old certificate canceled and the transaction recorded upon the transfer records of the corporation.
Section 6.04A.
Notice Upon Issuance or Transfer of Uncertificated Shares
. In accordance with
Chapter 8, Texas Business & Commerce Code, the corporation shall, after the issuance or transfer of
uncertificated shares, send to the registered owner of uncertificated shares a written notice
containing the information required to be set forth or stated on certificates pursuant to the Texas
Business Corporation Act, as it may be amended from time to time, and any successor to said act.
Section 6.05.
Fixing Record Dates.
For the purpose of determining shareholders (i) entitled
to notice of or to vote at any meeting of shareholders, or, after an adjournment thereof, at any
reconvened meeting, (ii) entitled to receive a distribution (other than a distribution involving a
purchase or redemption by the corporation of any of its own shares) or a share dividend or
(iii) for any other proper purpose (other than determining shareholders entitled to consent to
action by shareholders proposed to be taken without a meeting of shareholders), the board of
directors may fix in advance a date as the record date for any such determination of shareholders,
such date in any case to be not more than sixty days and, in the case of a meeting of shareholders,
not less than ten days, prior to the date on which the particular action requiring such
determination of shareholders, is to be taken. If no record date is fixed for the determination of
shareholders entitled to notice of or to vote at a meeting of shareholders, or shareholders
entitled to receive a distribution (other than a distribution involving a purchase or redemption by
the corporation of any of its own shares) or a share dividend, the date on which notice of the
meeting is mailed or the date on which the resolution of the board of directors declaring such
distribution or share dividend is adopted, as the case may be, shall be the record date for such
determination of shareholders. When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this Section 6.05, such determination shall
apply to any adjournment thereof. The stock transfer books shall not be closed for the foregoing
or any other purpose.
Section 6.06.
Fixing Record Dates for Consents to Action.
Unless a record date shall have
previously been fixed or determined, whenever action by shareholders is proposed to be
13
taken by consent in writing without a meeting of shareholders, the board of directors may fix
a record date for the purpose of determining shareholders entitled to consent to that action which
record date shall not precede, and shall not be more than ten days after, the date upon which the
resolution fixing the record date is adopted by the board of directors. If no record date has been
fixed by the board of directors and prior action of the board of directors is not required by law,
the record date for determining shareholders entitled to consent to action in writing without a
meeting shall be the first date on which a signed written consent setting forth the action taken
proposed to be taken is delivered to the corporation in the manner required by Section 2.10 of
these bylaws. If no record date shall have been fixed by the board of directors and prior action
of the board of directors is required by law, the record date for determining shareholders entitled
to consent to action in writing without a meeting shall be at the close of business on the date on
which the board of directors adopts a resolution taking such prior action.
Section 6.07.
Registered Shareholders.
Except as otherwise required by law, the corporation
shall be entitled to regard the person in whose name any shares are registered in the share
transfer records at any particular time as the owner of those shares at that time for purposes of
voting those shares, receiving distributions, share dividends or notices in respect thereof,
transferring those shares, exercising rights of dissent with respect to those shares, exercising or
waiving any preemptive right with respect to those shares, entering into agreements with respect to
those shares or giving proxies with respect to those shares. Except as otherwise required by law,
neither the corporation nor any of its officers, directors, employees or agents shall be liable for
regarding that person as the owner of those shares at that time for those purposes, regardless of
whether that person does not possess a certificate for those shares.
Section 6.08.
List of Shareholders.
The officer or agent having charge of the transfer books
for shares shall make, at least ten days before each meeting of shareholders, a complete list of
the shareholders entitled to vote at such meeting, arranged in alphabetical order, with the address
of each and the number of shares held by each, which list, for a period of ten days prior to such
meeting, shall be kept on file at the registered office or principal place of business of the
corporation and shall be subject to inspection by any shareholder at any time during usual business
hours. Such list shall also be produced and kept open at the time and place of the meeting and
shall be subject to the inspection of any shareholder during the whole time of the meeting. The
original share ledger or transfer book, or a duplicate thereof, shall be prima facie evidence as to
who are the shareholders entitled to examine such list or share ledger or transfer book or to vote
at any meeting of the shareholders.
Article VII
General Provisions
Section 7.01.
Distributions and Share Dividends.
Subject to the provisions of the articles of
incorporation relating thereto, if any, distributions and share dividends may be declared by the
board of directors, in its discretion, at any regular or special meeting, pursuant to law. Subject
to any provisions of the articles of incorporation, distributions may be made by the transfer of
money or other property (except the corporations own shares or rights to acquire such shares) or
by the issuance of indebtedness of the corporation, and share dividends may be paid in the
corporations own authorized but unissued shares or in treasury shares.
14
Section 7.02.
Reserve Funds.
Before payment of any distribution or share dividend, there may
be set aside out of any funds of the corporation available for distributions or share dividends
such sum or sums as the directors from time to time, in their absolute discretion, think proper as
a reserve fund for meeting contingencies, or for equalizing distributions or share dividends, or
for repairing or maintaining any property of the corporation, or for such other purpose as the
directors shall think conducive to the interest of the corporation, and the directors may modify or
abolish any such reserve in the manner in which it was created.
Section 7.03.
Checks.
All checks or demands for money and notes of the corporation shall be
signed by such officer or officers or such other person or persons as the board of directors may
from time to time designate.
Section 7.04.
Fiscal Year.
The fiscal year of the corporation shall end on the last Saturday
nearest to January 31 of each year.
Section 7.05.
Seal.
The corporate seal shall be in such form as may be prescribed by the
board of directors. The seal may be used by causing it or a facsimile thereof to be impressed or
affixed or in any manner reproduced.
Section 7.06.
Books and Records.
The corporation shall keep books and records of account and
shall keep minutes of the proceedings of its shareholders, its board of directors and each
committee of its board of directors. The corporation shall keep at its registered office or
principal place of business, or at the office of its transfer agent or registrar, a record of the
original issuance of shares issued by the corporation and a record of each transfer of those shares
that have been presented to the corporation for registration of transfer. Such records shall
contain the names and addresses of all past and current shareholders of the corporation and the
number and class of shares issued by the corporation shares held by each of them. Any books,
records and minutes may be in written form or in any other form capable of being converted into
written form within a reasonable time.
Section 7.07.
Invalid Provisions.
If any provision of these bylaws is held to be illegal,
invalid, or unenforceable under present or future laws, such provision shall be fully severable;
these bylaws shall be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part hereof; and the remaining provisions hereof shall remain in
full force and effect and shall not be affected by the illegal, invalid, or unenforceable provision
or by its severance herefrom. Furthermore, in lieu of such illegal, invalid, or unenforceable
provision there shall be added automatically as a part of these bylaws a provision as similar in
terms to such illegal, invalid, or unenforceable provision as may be possible and be legal, valid,
and enforceable.
Section 7.08.
Headings.
The headings used in these bylaws are for reference purposes only and
do not affect in any way the meaning or interpretation of these bylaws.
15
Article VIII
Indemnification of Directors and Officers
Article 2.02-1 of the Act (the Article) permits the corporation to indemnify its present and
former directors and officers to the extent and under the circumstances set forth therein. In
addition, in some instances, indemnification is required by the Article. The corporation hereby
elects to and does hereby indemnify all such persons to the fullest extent permitted or required by
the Article promptly upon request of any such person making a request for indemnity hereunder.
Such obligation to so indemnify and to so make such determinations may be specifically enforced by
resort to any court of competent jurisdiction. Further, the corporation shall pay or reimburse the
reasonable expenses of such persons covered hereby in advance of the final disposition of any
proceeding to the fullest extent permitted by the Article and subject to the conditions thereof.
A persons right to request, or entitlement to claim, indemnification, payment or
reimbursement pursuant to this Article VIII shall not be deemed exclusive of any other right to
request, or entitlement to claim, indemnification, payment or reimbursement pursuant to any
contract of insurance or any other law, contract, arrangement or understanding.
Article IX
Amendments
These bylaws may be altered, amended, or repealed or new bylaws may be adopted by the
affirmative vote of a majority of the whole board of directors at any regular or special meeting;
provided, that these bylaws may not be altered, amended, or repealed so as to be inconsistent with
law or any provision of the articles of incorporation.
16
Exhibit 10.1
THE
MENS WEARHOUSE, INC.
2004
LONG-TERM INCENTIVE PLAN
(As
Amended and Restated
Effective April 1, 2008)
TABLE OF
CONTENTS
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Section
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ARTICLE I ESTABLISHMENT, PURPOSE AND
DURATION
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Establishment
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1.1
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Purpose of the Plan
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1.2
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Duration of Authority to Make Grants Under the Plan
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1.3
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ARTICLE II DEFINITIONS
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Affiliate
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2.1
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Award
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2.2
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Award Agreement
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2.3
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Board
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2.4
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Cash-Based Award
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2.5
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Code
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2.6
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Committee
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2.7
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Company
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2.8
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Corporate Change
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2.9
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Covered Employee
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2.10
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Deferred Stock Unit
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2.11
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Deferred Stock Unit Award
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2.12
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Director
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2.13
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Disability
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2.14
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Dividend Equivalent
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2.15
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Effective Date
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2.16
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Employee
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2.17
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Exchange Act
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2.18
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Fair Market Value
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2.19
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Fiscal Year
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2.20
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Freestanding SAR
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2.21
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Holder
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2.22
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Incentive Stock Option or ISO
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2.23
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Mature Shares
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2.24
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Minimum Statutory Tax Withholding Obligation
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2.25
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Nonqualified Stock Option or NQSO
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2.26
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Option
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2.27
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Optionee
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2.28
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Option Price
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2.29
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Option Agreement
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2.30
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Other Stock-Based Award
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2.31
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Parent Corporation
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2.32
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Performance-Based Award
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2.33
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Performance-Based Compensation
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2.34
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Performance Goals
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2.35
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Performance Period
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2.36
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Performance Stock Award
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2.37
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Performance Unit Award
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2.38
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Period of Restriction
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2.39
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Plan
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2.40
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Restricted Stock
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2.41
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Restricted Stock Award
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2.42
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i
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Section
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Retirement
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2.43
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Section 409A
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2.44
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Stock Appreciation Right or SAR
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2.45
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Stock
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2.46
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Subsidiary Corporation
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2.47
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Substantial Risk of Forfeiture
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2.48
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Tandem SAR
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2.49
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Ten Percent Stockholder
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2.50
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Termination of Employment
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2.51
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Termination of Service
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2.52
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TMW Group
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2.53
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ARTICLE III ELIGIBILITY AND PARTICIPATION
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Eligibility
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3.1
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Participation
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3.2
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ARTICLE IV GENERAL PROVISIONS RELATING TO
AWARDS
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Authority to Grant Awards
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4.1
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Dedicated Shares; Maximum Awards
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4.2
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Shares That Count Against Limit
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4.3
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Non-Transferability
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4.4
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Requirements of Law
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4.5
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Changes in the Companys Capital Structure
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4.6
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Election Under Section 83(b) of the Code
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4.7
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Forfeiture for Cause
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4.8
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Forfeiture Events
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4.9
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Award Agreements
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4.10
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Amendment of Award Agreements
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4.11
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Rights as Stockholder
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4.12
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Issuance of Shares of Stock
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4.13
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Restrictions on Stock Received
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4.14
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Compliance With Section 409A
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4.15
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Source of Shares Deliverable Under Awards
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4.16
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ARTICLE V OPTIONS
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Authority to Grant Options
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5.1
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Type of Options Available
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5.2
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Option Agreement
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5.3
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Option Price
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5.4
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Duration of Options
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5.5
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Amount Exercisable
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5.6
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Exercise of Options
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5.7
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Transferability of Options
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5.8
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Notification of Disqualifying Disposition
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5.9
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No Rights as Stockholder
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5.10
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$100,000 Limitation on Incentive Stock Options
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5.11
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ARTICLE VI STOCK APPRECIATION RIGHTS
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Authority to Grant Stock Appreciation Rights Awards
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6.1
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Type of Stock Appreciation Rights Available
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6.2
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General Terms
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6.3
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ii
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Section
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Stock Appreciation Right Agreement
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6.4
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Term of Stock Appreciation Rights
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6.5
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Exercise of Freestanding SARs
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6.6
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Exercise of Tandem SARs
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6.7
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Payment of SAR Amount
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6.8
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Termination of Employment or Termination of Service
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6.9
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Nontransferability of SARs
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6.10
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No Rights as Stockholder
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6.11
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Restrictions on Stock Received
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6.12
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ARTICLE VII RESTRICTED STOCK AWARDS
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Restricted Stock Awards
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7.1
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Restricted Stock Award Agreement
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7.2
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Holders Rights as Stockholder
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7.3
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ARTICLE VIII DEFERRED STOCK UNIT AWARDS
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Authority to Grant Deferred Stock Unit Awards
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8.1
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Deferred Stock Unit Awards
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8.2
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Deferred Stock Unit Award Agreement
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8.3
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Dividend Equivalents
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8.4
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Form of Payment Under Deferred Stock Unit Award
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8.5
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Time of Payment Under Deferred Stock Unit Award
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8.6
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Holders Rights as Stockholder
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8.7
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ARTICLE IX PERFORMANCE STOCK AND PERFORMANCE
UNIT AWARDS
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Authority to Grant Performance Stock and Performance Unit
Awards
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9.1
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Time of Payment Under Performance Unit Award
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9.2
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Holders Rights as Stockholder With Respect to a
Performance Stock Award
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9.3
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Increases Prohibited
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9.4
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Stockholder Approval
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9.5
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Dividend Equivalents
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9.6
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ARTICLE X CASH-BASED AWARDS AND OTHER
STOCK-BASED AWARDS
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Authority to Grant Cash-Based Awards
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10.1
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Authority to Grant Other Stock-Based Awards
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10.2
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Value of Cash-Based Awards and Other Stock-Based Awards
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10.3
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Payment of Cash-Based Awards and Other Stock-Based Awards
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10.4
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Termination of Employment or Service
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10.5
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Nontransferability
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10.6
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ARTICLE XI SUBSTITUTION AWARDS
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ARTICLE XII ADMINISTRATION
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Awards
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12.1
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Authority of the Committee
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12.2
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Decisions Binding
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12.3
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No Liability
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12.4
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ARTICLE XIII AMENDMENT OR TERMINATION OF
PLAN
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Amendment, Modification, Suspension, and Termination
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13.1
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Awards Previously Granted
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13.2
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ARTICLE XIV MISCELLANEOUS
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Unfunded Plan/No Establishment of a Trust Fund
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14.1
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No Employment Obligation
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14.2
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iii
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Section
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Tax Withholding
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14.3
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Written Agreement
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14.4
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Indemnification of the Committee
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14.5
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Gender and Number
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14.6
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Severability
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14.7
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Headings
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14.8
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Other Compensation Plans
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14.9
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Other Awards
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14.10
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Successors
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14.11
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Law Limitations/Governmental Approvals
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14.12
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Delivery of Title
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14.13
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Inability to Obtain Authority
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14.14
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Investment Representations
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14.15
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Persons Residing Outside of the United States
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14.16
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No Fractional Shares
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14.17
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Arbitration of Disputes
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14.18
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Governing Law
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14.19
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iv
THE
MENS WEARHOUSE, INC.
2004 LONG-TERM INCENTIVE PLAN
(As Amended and Restated Effective April 1, 2008)
WITNESSETH
:
WHEREAS
, effective March 29, 2004, The Mens
Wearhouse, Inc. (the
Company
) adopted The
Mens Wearhouse, Inc. 2004 Long-Term Incentive Plan (the
Plan
) for the benefit of key employees of the
Company and affiliates of the Company;
WHEREAS
, the Company desires to allow non-employee
directors of the Company to receive awards under the Plan;
WHEREAS
, the Company desires to restate the limitations
set forth in the Plan on the number of shares of stock available
for awards granted or paid in shares of stock to reflect the
three-for-two stock split effected by the Company through the
payment of a 50 percent stock dividend to shareholders of
record as of May 31, 2005, and the Company desires to
increase the aggregate number of shares of stock with respect to
which awards may be granted under the Plan by
1,210,059 shares; and
WHEREAS
, the Company desires to amend and restate the
Plan on behalf of itself and on behalf of the other adopting
entities;
NOW THEREFORE
, the Plan is hereby amended and restated in
its entirety as follows, effective as of April 1, 2008,
except insofar as an earlier effective date is expressly
specified.
ARTICLE I
ESTABLISHMENT,
PURPOSE AND DURATION
1.1
Establishment.
The Company has
previously established the incentive compensation plan known as
The Mens Wearhouse, Inc. 2004 Long-Term Incentive
Plan. The Plan permits the grant of Options (both
Incentive Stock Options and Nonqualified Stock Options), Stock
Appreciation Rights, Restricted Stock, Deferred Stock Units,
Performance Stock Awards, Performance Units, Cash-Based Awards,
and Other Stock-Based Awards. The Plan became effective on
March 29, 2004, the date the Plan was approved by the
Board, which date was within one year of the date the Plan was
approved by the holders of at least a majority of the
outstanding shares of voting stock of the Company at a meeting
of the stockholders of the Company (the
Effective
Date
), and shall remain in effect as provided in
Section 1.3.
1.2
Purpose of the Plan.
The purpose of
the Plan is to reward certain non-employee directors of the
Company and certain corporate officers and other employees of
the Company and its Affiliates (collectively, the
TMW
Group
) by enabling them to acquire shares of common
stock of the Company and to receive other compensation based on
the increase in value of the common stock of the Company or
certain other performance measures. The Plan is intended to
advance the best interests of the Company, its Affiliates and
its stockholders by providing those persons who have substantial
responsibility for the direction, management and growth of the
TMW Group with additional performance incentives and an
opportunity to obtain or increase their proprietary interest in
the Company, thereby encouraging them to continue in their
employment or affiliation with the TMW Group.
1.3
Duration of Authority to Make Grants Under the
Plan.
The Plan shall continue indefinitely until
it is terminated pursuant to Section 13.1. No Awards may be
granted under the Plan on or after the tenth anniversary of the
Effective Date. The applicable provisions of the Plan will
continue in effect with respect to an Award granted under the
Plan for as long as such Award remains outstanding.
I-1
ARTICLE II
DEFINITIONS
The words and phrases defined in this Article shall have the
meaning set out below throughout the Plan, unless the context in
which any such word or phrase appears reasonably requires a
broader, narrower or different meaning.
2.1
Affiliate
means any corporation,
partnership, limited liability company or association, trust or
other entity or organization which, directly or indirectly,
controls, is controlled by, or is under common control with, the
Company. For purposes of the preceding sentence,
control (including, with correlative meanings, the
terms controlled by and under common control
with), as used with respect to any entity or organization,
shall mean the possession, directly or indirectly, of the power
(a) to vote more than 50 percent (50%) of the
securities having ordinary voting power for the election of
directors of the controlled entity or organization, or
(b) to direct or cause the direction of the management and
policies of the controlled entity or organization, whether
through the ownership of voting securities or by contract or
otherwise.
2.2
Award
means, individually or
collectively, a grant under the Plan of Incentive Stock Options,
Nonqualified Stock Options, Stock Appreciation Rights,
Restricted Stock, Deferred Stock Units, Performance Stock
Awards, Performance Units, Cash-Based Awards, and Other
Stock-Based Awards, in each case subject to the terms and
provisions of the Plan.
2.3
Award Agreement
means an agreement
that sets forth the terms and conditions applicable to an Award
granted under the Plan.
2.4
Board
means the board of directors
of the Company.
2.5
Cash-Based Award
means an Award
granted to a Holder pursuant to Article X.
2.6
Code
means the United States
Internal Revenue Code of 1986, as amended from time to time.
2.7
Committee
means (a) in the case
of an Award granted to a Director, the Board, and (b) in
the case of any other Award granted under the Plan, a committee
of at least two persons, who are members of the Compensation
Committee of the Board and are appointed by the Compensation
Committee of the Board, or, to the extent it chooses to operate
as the Committee, the Compensation Committee of the Board. Each
member of the Committee in respect of his or her participation
in any decision with respect to an Award that is intended to
satisfy the requirements of section 162(m) of the Code must
satisfy the requirements of outside director status
within the meaning of section 162(m) of the Code; provided,
however, that the failure to satisfy such requirement shall not
affect the validity of the action of any committee otherwise
duly authorized and acting in the matter. As to Awards, grants
or other transactions that are authorized by the Committee and
that are intended to be exempt under
Rule 16b-3,
the requirements of
Rule 16b-3(d)(1)
with respect to committee action must also be satisfied.
2.8
Company
means The Mens
Wearhouse, Inc., a Texas corporation, or any successor (by
reincorporation, merger or otherwise).
2.9
Corporate Change
shall have the
meaning ascribed to that term in Section 4.6(c).
2.10
Covered Employee
means a Holder who
is a covered employee, as defined in
section 162(m) of the Code and the regulations promulgated
thereunder, or any successor statute.
2.11
Deferred Stock Unit
means a unit
credited to a Holders ledger account maintained by the
Company pursuant to Article VIII.
2.12
Deferred Stock Unit Award
means an
Award granted pursuant to Article VIII.
2.13
Director
means a member of the
Board who is not an Employee.
2.14
Disability
means, effective for
awards issued under the Plan that are earned and vested on or
after January 1, 2005, as determined by the Committee in
its discretion exercised in good faith, (a) in the case of
an Award that is exempt from the application of the requirements
of Section 409A, a physical or mental condition of the
Holder that would entitle him to payment of disability income
payments under the Companys long-term disability insurance
policy or plan for employees as then in effect; or in the event
that the Holder is a Director or is not covered,
II-1
for whatever reason, under the Companys long-term
disability insurance policy or plan for employees or in the
event the Company does not maintain such a long-term disability
insurance policy, Disability means a permanent and
total disability as defined in section 22(e)(3) of the Code
and (b) in the case of an Award that is not exempt from the
application of the requirements of Section 409A,
(i) the Holder is unable to engage in any substantial
gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not
less than 12 months, or (ii) the Holder is, by reason
of any medically determinable physical or mental impairment that
can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months,
receiving income replacement benefits for a period of not less
than three months under an accident and health plan covering
employees of the Company. A determination of Disability may be
made by a physician selected or approved by the Committee and,
in this respect, the Holder shall submit to an examination by
such physician upon request by the Committee.
2.15
Dividend Equivalent
means a payment
equivalent in amount to dividends paid to the Companys
stockholders.
2.16
Effective Date
shall have the
meaning ascribed to that term in Section 1.1.
2.17
Employee
means (a) a person
employed by the Company or any Affiliate as a common law
employee or (b) a person who has agreed to become a common
law employee of the Company or any Affiliate and is expected to
become such within six (6) months from the date of a
determination made for purposes of the Plan.
2.18
Exchange Act
means the United
States Securities Exchange Act of 1934, as amended from time to
time.
2.19
Fair Market Value
of the Stock as of any
particular date means,
(a) if the Stock is traded on a stock exchange,
(i) and if the Stock is traded on that date, the closing
sale price of the Stock on that date; or
(ii) and if the Stock is not traded on that date, the
closing sale price of the Stock on the last trading date
immediately preceding that date;
as reported on the principal securities exchange on which the
Stock is traded; or
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(b)
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if the Stock is traded in the over-the-counter market,
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(i) and if the Stock is traded on that date, the average
between the high bid and low asked price on that date; or
(ii) and if the Stock is not traded on that date, the
average between the high bid and low asked price on the last
trading date immediately preceding that date;
as reported in such over-the-counter market; provided, however,
that (x) if the Stock is not so traded, or (y) if, in
the discretion of the Committee, another means of determining
the fair market value of a share of Stock at such date shall be
necessary or advisable, the Committee may provide for another
means for determining such fair market value that complies with
the requirements of Section 409A.
2.20
Fiscal Year
means the
Companys fiscal year.
2.21
Freestanding SAR
means a SAR that
is granted pursuant to Article VI independently of any
Option.
2.22
Holder
means a person who has been
granted an Award or any person who is entitled to receive shares
of Stock (and/or cash in the case of a Stock Appreciation Right)
under an Award.
2.23
Incentive Stock Option
or
ISO
means an option which is intended, as
evidenced by its designation, as an incentive stock option
within the meaning of section 422 of the Code, the award of
which contains such provisions (including but not limited to the
receipt of stockholder approval of the Plan, if the Award is
made prior to such approval) and is made under such
circumstances and to such persons as may be necessary to comply
with that section.
2.24
Mature Shares
means shares of Stock
that the Holder has held for at least six months.
II-2
2.25
Minimum Statutory Tax Withholding
Obligation
means, with respect to an Award, the amount
the Company or an Affiliate is required to withhold for federal,
state and local taxes based upon the applicable minimum
statutory withholding rates required by the relevant tax
authorities.
2.26
Nonqualified Stock Option
or
NQSO
means an Option that is designated as a
nonqualified stock option. Any Option granted hereunder that is
not designated as an incentive stock option shall be deemed to
be designated a nonqualified stock option under the Plan and not
an incentive stock option under the Code.
2.27
Option
means an Incentive Stock
Option or a Nonqualified Stock Option granted pursuant to
Article V.
2.28
Optionee
means a person who is
granted an Option under the Plan.
2.29
Option Price
shall have the meaning
ascribed to that term in Section 5.4.
2.30
Option Agreement
means a written
contract setting forth the terms and conditions of an Option.
2.31
Other Stock-Based Award
means an
equity-based or equity-related Award not otherwise described by
the terms and provisions of the Plan that is granted pursuant to
Article X.
2.32
Parent Corporation
means any
corporation (other than the Company) in an unbroken chain of
corporations ending with the Company if, at the time of the
action or transaction, each of the corporations other than the
Company owns stock possessing 50 percent or more of the
total combined voting power of all classes of stock in one of
the other corporations in the chain.
2.33
Performance-Based Award
means a
Performance Stock Award, a Performance Unit, or a Cash-Based
Award granted to a Holder under which the fulfillment of
performance goals determines the degree of payout or vesting.
2.34
Performance-Based Compensation
means compensation under an Award that satisfies the
requirements of section 162(m) of the Code for
deductibility of remuneration paid to Covered Employees.
2.35
Performance Goals
means one or more
of the criteria described in Article IX on which the
performance goals applicable to an Award are based.
2.36
Performance Period
means the period
of time during which the performance goals applicable to a
Performance-Based Award must be met.
2.37
Performance Stock Award
means an
Award designated as a performance stock award granted to a
Holder pursuant to Article IX.
2.38
Performance Unit Award
means an
Award designated as a performance unit award granted to a Holder
pursuant to Article IX.
2.39
Period of Restriction
means the
period during which Restricted Stock is subject to a substantial
risk of forfeiture (based on the passage of time, the
achievement of Performance Goals, or upon the occurrence of
other events as determined by the Committee, in its discretion),
as provided in Article VII.
2.40
Plan
means The Mens
Wearhouse, Inc. 2004 Long-Term Incentive Plan, as set forth in
this document and as it may be amended from time to time.
2.41
Restricted Stock
means shares of
restricted Stock issued or granted under the Plan pursuant to
Article VII.
2.42
Restricted Stock Award
means an
authorization by the Committee to issue or transfer Restricted
Stock to a Holder.
2.43
Retirement
means (a) in the
case of an Employee, retirement in accordance with the terms of
a retirement plan that is qualified under section 401(a) of
the Code and maintained by the Company or an Affiliate in which
the Holder is a participant and (b) in the case of a
Director, retirement from the Board in accordance with the
Boards then applicable retirement policy.
II-3
2.44
Section 409A
means
section 409A of the Code and Department of Treasury rules
and regulations issued thereunder.
2.45
Stock Appreciation Right
or
SAR
means any stock appreciation right
granted pursuant to Article VI of the Plan.
2.46
Stock
means the common stock of the
Company, $.01 par value per share (or such other par value
as may be designated by act of the Companys stockholders).
2.47
Subsidiary Corporation
means any
corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if, at the time of the
action or transaction, each of the corporations other than the
last corporation in an unbroken chain owns stock possessing
50 percent or more of the total combined voting power of
all classes of stock in one of the other corporations in the
chain.
2.48
Substantial Risk of Forfeiture
shall have the meaning ascribed to that term in
Section 409A.
2.49
Tandem SAR
means a SAR that is
granted in connection with a related Option pursuant to
Article VI, the exercise of which shall require forfeiture
of the right to purchase a share of the Stock under the related
Option (and when a share of the Stock is purchased under the
Option, the Tandem SAR shall similarly be canceled).
2.50
Ten Percent Stockholder
means
an individual who, at the time the Option is granted, owns stock
possessing more than ten percent (10%) of the total combined
voting power of all classes of stock or series of the Company or
of any Parent Corporation or Subsidiary Corporation. An
individual shall be considered as owning the stock owned,
directly or indirectly, by or for his brothers and sisters
(whether by the whole or half blood), spouse, ancestors and
lineal descendants; and stock owned, directly or indirectly, by
or for a corporation, partnership, estate or trust, shall be
considered as being owned proportionately by or for its
stockholders, partners or beneficiaries.
2.51
Termination of Employment
means, in
the case of an Award issued to an Employee other than an
Incentive Stock Option, the termination of the Employees
employment relationship with the Company and all Affiliates.
Termination of Employment
means, in the case
of an Incentive Stock Option, the termination of the
Employees employment relationship with all of the Company,
any Parent Corporation, any Subsidiary Corporation and any
parent or subsidiary corporation (within the meaning of
section 422(a)(2) of the Code) of any such corporation that
issues or assumes an Incentive Stock Option in a transaction to
which section 424(a) of the Code applies.
2.52
Termination of Service
means, in
the case of an Award issued to a Director, the termination of
the Directors service on the Board.
2.53
TMW Group
shall have the meaning
ascribed to that term in Section 1.2.
II-4
ARTICLE III
ELIGIBILITY
AND PARTICIPATION
3.1
Eligibility.
The persons who are
eligible to receive Awards under the Plan, other than Incentive
Stock Options, are key Employees who have substantial
responsibility for or involvement with the management and growth
of one or more members of the TMW Group and Directors. However,
only those persons who are, on the dates of grant, key employees
of the Company or any Parent Corporation or Subsidiary
Corporation are eligible for grants of Incentive Stock Options
under the Plan.
3.2
Participation.
Subject to the terms
and provisions of the Plan, the Committee may, from time to
time, select the eligible persons to whom Awards shall be
granted and shall determine the nature and amount of each Award.
III-1
ARTICLE IV
GENERAL PROVISIONS RELATING TO AWARDS
4.1
Authority to Grant Awards
. The
Committee may grant Awards to those key Employees and Directors
as the Committee shall from time to time determine, under the
terms and conditions of the Plan. Subject only to any applicable
limitations set out in the Plan, the number of shares of Stock
or other value to be covered by any Award to be granted under
the Plan shall be as determined by the Committee in its sole
discretion.
4.2
Dedicated Shares; Maximum Awards.
The
aggregate number of shares of Stock with respect to which Awards
may be granted under the Plan is 2,110,059. The aggregate number
of shares of Stock with respect to which Incentive Stock Options
may be granted under the Plan is 2,110,059. The aggregate number
of shares of Stock with respect to which Nonqualified Stock
Options may be granted under the Plan is 2,110,059. The
aggregate number of shares of Stock with respect to which Stock
Appreciation Rights may be granted under the Plan is 2,110,059.
The aggregate number of shares of Stock with respect to which
Restricted Stock Awards may be granted under the Plan is
1,055,030. The aggregate number of shares of Stock with respect
to which Performance Stock Awards may be granted under the Plan
is 1,055,030. The maximum number of shares of Stock with respect
to which Incentive Stock Options may be granted to an Employee
during a Fiscal Year is 300,000. The maximum number of shares of
Stock with respect to which Nonqualified Stock Options may be
granted to an Employee or Director during a Fiscal Year is
300,000. The maximum number of shares of Stock with respect to
which Stock Appreciation Rights may be granted to an Employee or
Director during a Fiscal Year is 300,000. The maximum number of
shares of Stock with respect to which Restricted Stock Awards
may be granted to an Employee or Director during a Fiscal Year
is 225,000. The maximum amount with respect to which Deferred
Stock Unit Awards may be granted to an Employee or Director
during a Fiscal Year may not exceed in value the Fair Market
Value of 225,000 shares of Stock determined as of the date
of grant. The maximum number of shares of Stock with respect to
which Performance Stock Awards may be granted to an Employee or
Director during a Fiscal Year is 225,000. The maximum number of
shares of Stock with respect to which Performance Unit Awards
may be granted to an Employee or Director during a Fiscal Year
is 225,000. The maximum number of shares of Stock with respect
to which Other Stock-Based Awards may be granted to an Employee
during a Fiscal Year is 225,000. The maximum aggregate amount
with respect to which Cash-Based Awards may be awarded or
credited to an Employee or Director during a Fiscal Year may not
exceed in value $3,000,000 determined as of the date of grant.
The maximum aggregate amount with respect to which Performance
Unit Awards may be awarded or credited to an Employee or
Director during a Fiscal Year may not exceed in value $3,000,000
determined as of the date of grant. Each of the foregoing
numerical limits stated in this Section 4.2 shall be
subject to adjustment in accordance with the provisions of
Section 4.6. The number of shares of Stock stated in this
Section 4.2 shall also be increased by such number of
shares of Stock as become subject to substitute Awards granted
pursuant to Article XI; provided, however, that such
increase shall be conditioned upon the approval of the
stockholders of the Company to the extent stockholder approval
is required by law or applicable stock exchange rules.
4.3
Shares That Count Against Limit.
(a) If any outstanding Award expires or terminates for any
reason, is settled in cash in lieu of shares of Stock or any
Award is surrendered, the shares of Stock allocable to the
unexercised portion of that Award may again be subject to an
Award granted under the Plan.
(b) For Awards granted under the Plan before April 1,
2008, if shares of Stock are withheld from payment of the Award
to satisfy tax obligations with respect to such Award, such
shares of Stock will not count against the aggregate number of
shares of Stock with respect to which Awards may be granted
under the Plan. For Awards granted under the Plan on or after
April 1, 2008, if shares of Stock are withheld from payment
of the Award to satisfy tax obligations with respect to such
Award, such shares of Stock will count against the aggregate
number of shares of Stock with respect to which Awards may be
granted under the Plan.
(c) If a Stock Appreciation Right is exercised, only the
number of shares of Stock actually issued shall be charged
against the maximum number of shares of Stock that may be
delivered pursuant to Awards under the Plan.
IV-1
4.4
Non-Transferability.
Except as
specified in the applicable Award Agreement or in a domestic
relations court order, an Award shall not be transferable by the
Holder (whether for consideration or otherwise) other than by
will or under the laws of descent and distribution, and shall be
exercisable, during the Holders lifetime, only by him or
her. Any attempted assignment of an Award in violation of this
Section 4.4 shall be null and void. In the discretion of
the Committee, any attempt to transfer an Award other than under
the terms of the Plan and the applicable Award Agreement may
terminate the Award. No ISO granted under the Plan may be sold,
transferred, pledged, assigned or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, all ISOs granted to an Employee under the
Plan shall be exercisable during his or her lifetime only by the
Employee, and after that time, by the Employees heirs or
estate.
4.5
Requirements of Law.
The Company
shall not be required to sell or issue any shares of Stock under
any Award if issuing those shares of Stock would constitute or
result in a violation by the Holder or the Company of any
provision of any law, statute or regulation of any governmental
authority. Specifically, in connection with any applicable
statute or regulation relating to the registration of
securities, upon exercise of any Option or pursuant to any other
Award, the Company shall not be required to issue any shares of
Stock unless the Committee has received evidence satisfactory to
it to the effect that the Holder will not transfer the shares of
Stock except in accordance with applicable law, including
receipt of an opinion of counsel satisfactory to the Company to
the effect that any proposed transfer complies with applicable
law. The determination by the Committee on this matter shall be
final, binding and conclusive. The Company may, but shall in no
event be obligated to, register any shares of Stock covered by
the Plan pursuant to applicable securities laws of any country
or any political subdivision. In the event the shares of Stock
issuable on exercise of an Option or pursuant to any other Award
are not registered, the Company may imprint on the certificate
evidencing the shares of Stock any legend that counsel for the
Company considers necessary or advisable to comply with
applicable law, or, should the shares of Stock be represented by
book or electronic entry rather than a certificate, the Company
may take such steps to restrict transfer of the shares of Stock
as counsel for the Company considers necessary or advisable to
comply with applicable law. The Company shall not be obligated
to take any other affirmative action in order to cause or enable
the exercise of an Option or any other Award, or the issuance of
shares of Stock pursuant thereto, to comply with any law or
regulation of any governmental authority.
4.6
Changes in the Companys Capital Structure
.
(a) The existence of outstanding Awards shall not affect in
any way the right or power of the Company or its stockholders to
make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Companys capital
structure or its business, any merger or consolidation of the
Company, any issue of bonds, debentures, preferred or prior
preference shares ahead of or affecting the Stock or Stock
rights, the dissolution or liquidation of the Company, any sale
or transfer of all or any part of its assets or business or any
other corporate act or proceeding, whether of a similar
character or otherwise.
(b) If the Company shall effect a subdivision or
consolidation of Stock or other capital readjustment, the
payment of a Stock dividend, or other increase or reduction of
the number of shares of Stock outstanding, without receiving
compensation therefor in money, services or property, then
(1) the number, class or series and per share price of
Stock subject to outstanding Options or other Awards under the
Plan shall be appropriately adjusted (subject to the restriction
in Section 4.11 prohibiting repricing) in such a manner as
to entitle a Holder to receive upon exercise of an Option or
other Award, for the same aggregate cash consideration, the
equivalent total number and class or series of Stock the Holder
would have received had the Holder exercised his or her Option
or other Award in full immediately prior to the event requiring
the adjustment, and (2) the number and class or series of
Stock then reserved to be issued under the Plan shall be
adjusted by substituting for the total number and class or
series of Stock then reserved that number and class or series of
Stock that would have been received by the owner of an equal
number of outstanding shares of Stock of each class or series of
Stock as the result of the event requiring the adjustment.
(c) If while unexercised Options or other Awards remain
outstanding under the Plan (1) the Company shall not be the
surviving entity in any merger, consolidation or other
reorganization (or survives only as a subsidiary of an entity
other than an entity that was wholly-owned by the Company
immediately prior to such merger, consolidation or other
reorganization), (2) the Company sells, leases or exchanges
or agrees to sell,
IV-2
lease or exchange all or substantially all of its assets to any
other person or entity (other than an entity wholly-owned by the
Company), (3) the Company is to be dissolved or
(4) the Company is a party to any other corporate
transaction (as defined under section 424(a) of the Code
and applicable Department of Treasury regulations) that is not
described in clauses (1), (2) or (3) of this sentence
(each such event is referred to herein as a
Corporate
Change
), then, except as otherwise provided in an
Award Agreement or another agreement between the Holder and the
Company (provided that such exceptions shall not apply in the
case of a reincorporation merger), or as a result of the
Committees effectuation of one or more of the alternatives
described below, there shall be no acceleration of the time at
which any Award then outstanding may be exercised, and no later
than ten days after the approval by the stockholders of the
Company of such Corporate Change, the Committee, acting in its
sole and absolute discretion without the consent or approval of
any Holder, shall act to effect one or more of the following
alternatives, which may vary among individual Holders and which
may vary among Awards held by any individual Holder (provided
that, with respect to a reincorporation merger in which Holders
of the Companys ordinary shares will receive one ordinary
share of the successor corporation for each ordinary share of
the Company, none of such alternatives shall apply and, without
Committee action, each Award shall automatically convert into a
similar award of the successor corporation exercisable for the
same number of ordinary shares of the successor as the Award was
exercisable for ordinary shares of Stock of the Company):
(1) accelerate the time at which some or all of the Awards
then outstanding may be exercised so that such Awards may be
exercised in full for a limited period of time on or before a
specified date (before or after such Corporate Change) fixed by
the Committee, after which specified date all such Awards that
remain unexercised and all rights of Holders thereunder shall
terminate;
(2) require the mandatory surrender to the Company by all
or selected Holders of some or all of the then outstanding
Awards held by such Holders (irrespective of whether such Awards
are then exercisable under the provisions of the Plan or the
applicable Award Agreement evidencing such Award) as of a date,
before or after such Corporate Change, specified by the
Committee, in which event the Committee shall thereupon cancel
such Award and the Company shall pay to each such Holder an
amount of cash per share equal to the excess, if any, of the per
share price offered to stockholders of the Company in connection
with such Corporate Change over the exercise prices under such
Award for such shares;
(3) with respect to all or selected Holders, have some or
all of their then outstanding Awards (whether vested or
unvested) assumed or have a new award of a similar nature
substituted for some or all of their then outstanding Awards
under the Plan (whether vested or unvested) by an entity which
is a party to the transaction resulting in such Corporate Change
and which is then employing such Holder or which is affiliated
or associated with such Holder in the same or a substantially
similar manner as the Company prior to the Corporate Change, or
a parent or subsidiary of such entity, provided that
(A) such assumption or substitution is on a basis where the
excess of the aggregate fair market value of the Stock subject
to the Award immediately after the assumption or substitution
over the aggregate exercise price of such Stock is equal to the
excess of the aggregate fair market value of all Stock subject
to the Award immediately before such assumption or substitution
over the aggregate exercise price of such Stock, and
(B) the assumed rights under such existing Award or the
substituted rights under such new Award, as the case may be,
will have the same terms and conditions as the rights under the
existing Award assumed or substituted for, as the case may be;
(4) provide that the number and class or series of Stock
covered by an Award (whether vested or unvested) theretofore
granted shall be adjusted so that such Award when exercised
shall thereafter cover the number and class or series of Stock
or other securities or property (including, without limitation,
cash) to which the Holder would have been entitled pursuant to
the terms of the agreement or plan relating to such Corporate
Change if, immediately prior to such Corporate Change, the
Holder had been the holder of record of the number of shares of
Stock then covered by such Award; or
(5) make such adjustments to Awards then outstanding as the
Committee deems appropriate to reflect such Corporate Change
(provided, however, that the Committee may determine in its sole
and absolute discretion that no such adjustment is necessary).
IV-3
In effecting one or more of the alternatives set out in
paragraphs (3), (4) or (5) immediately above, and
except as otherwise may be provided in an Award Agreement, the
Committee, in its sole and absolute discretion and without the
consent or approval of any Holder, may accelerate the time at
which some or all Awards then outstanding may be exercised.
(d) In the event of changes in the outstanding Stock by
reason of recapitalizations, reorganizations, mergers,
consolidations, combinations, exchanges or other relevant
changes in capitalization occurring after the date of the grant
of any Award and not otherwise provided for by this
Section 4.6, any outstanding Award and any Award Agreement
evidencing such Award shall be subject to adjustment by the
Committee in its sole and absolute discretion as to the number
and price of Stock or other consideration subject to such Award.
In the event of any such change in the outstanding Stock, the
aggregate number of shares of Stock available under the Plan may
be appropriately adjusted by the Committee, whose determination
shall be conclusive.
(e) After a merger of one or more corporations into the
Company or after a consolidation of the Company and one or more
corporations in which the Company shall be the surviving
corporation, each Holder shall be entitled to have his
Restricted Stock appropriately adjusted based on the manner in
which the shares of Stock were adjusted under the terms of the
agreement of merger or consolidation.
(f) The issuance by the Company of stock of any class or
series, or securities convertible into, or exchangeable for,
stock of any class or series, for cash or property, or for labor
or services either upon direct sale or upon the exercise of
rights or warrants to subscribe for them, or upon conversion or
exchange of stock or obligations of the Company convertible
into, or exchangeable for, stock or other securities, shall not
affect, and no adjustment by reason of such issuance shall be
made with respect to, the number, class or series, or price of
shares of Stock then subject to outstanding Options or other
Awards.
4.7
Election Under Section 83(b) of the
Code.
No Holder shall exercise the election
permitted under section 83(b) of the Code with respect to
any Award without the prior written approval of the Chief
Financial Officer of the Company. Any Holder who makes an
election under section 83(b) of the Code with respect to
any Award without the prior written approval of the Chief
Financial Officer of the Company may, in the discretion of the
Committee, forfeit any or all Awards granted to him or her under
the Plan.
4.8
Forfeiture for Cause.
Notwithstanding
any other provision of the Plan or an Award Agreement, if the
Committee finds by a majority vote that a Holder, before or
after his Termination of Employment or severance of affiliation
relationship with the Company and all Affiliates,
(a) committed fraud, embezzlement, theft, felony or an act
of dishonesty in the course of his employment by or affiliation
with the Company or an Affiliate which conduct damaged the
Company or an Affiliate, (b) disclosed trade secrets of the
Company or an Affiliate or (c) violated the terms of any
non-competition, non-disclosure or similar agreement with
respect to the Company or any Affiliate to which the Holder is a
party, then as of the date the Committee makes its finding some
or all Awards awarded to the Holder (including vested Awards
that have been exercised, vested Awards that have not been
exercised and Awards that have not yet vested), as determined by
the Committee in its sole discretion, and all net proceeds
realized with respect to any such Awards, will be forfeited to
the Company on such terms as determined by the Committee. The
findings and decision of the Committee with respect to such
matter, including those regarding the acts of the Holder and the
damage done to the Company, will be final for all purposes. No
decision of the Committee, however, will affect the finality of
the discharge of the individual by the Company or an Affiliate
or severance of the individuals affiliation with the
Company and all Affiliates.
4.9
Forfeiture Events.
The Committee may
specify in an Award Agreement that the Holders rights,
payments, and benefits with respect to an Award shall be subject
to reduction, cancellation, forfeiture, or recoupment upon the
occurrence of certain specified events, in addition to any
otherwise applicable vesting or performance conditions of an
Award. Such events may include, but shall not be limited to,
Termination of Employment for cause, termination of the
Holders provision of services to the Company or its
Affiliates, violation of material policies of the TMW Group,
breach of noncompetition, confidentiality, or other restrictive
covenants that may apply to the Holder, or other conduct by the
Holder that is detrimental to the business or reputation of the
TMW Group.
IV-4
4.10
Award Agreements.
Each Award shall
be embodied in a written Award Agreement that shall be subject
to the terms and conditions of the Plan. The Award Agreement
shall be signed by an executive officer of the Company, other
than the Holder, on behalf of the Company, and may be signed by
the Holder to the extent required by the Committee. The Award
Agreement may specify the effect of a change in control of the
Company on the Award. The Award Agreement may contain any other
provisions that the Committee in its discretion shall deem
advisable which are not inconsistent with the terms and
provisions of the Plan.
4.11
Amendments of Award Agreements.
The
terms of any outstanding Award under the Plan may be amended
from time to time by the Committee in its discretion in any
manner that it deems appropriate and that is consistent with the
terms of the Plan. However, no such amendment shall adversely
affect in a material manner any right of a Holder without his or
her written consent. Except as specified in Section 4.6(c),
the Committee may not directly or indirectly lower the exercise
price of a previously granted Option or the grant price of a
previously granted SAR.
4.12
Rights as Stockholder.
A Holder
shall not have any rights as a stockholder with respect to Stock
covered by an Option, a SAR, a DSU or a Performance Unit Award
payable in Stock until the date, if any, such Stock is issued by
the Company; and, except as otherwise provided in
Section 4.6, no adjustment for dividends, or otherwise,
shall be made if the record date therefor is prior to the date
of issuance of such Stock.
4.13
Issuance of Shares of Stock.
Shares
of Stock, when issued, may be represented by a certificate or by
book or electronic entry.
4.14
Restrictions on Stock Received.
The
Committee may impose such conditions
and/or
restrictions on any shares of Stock issued pursuant to an Award
as it may deem advisable or desirable. These restrictions may
include, but shall not be limited to, a requirement that the
Holder hold the shares of Stock for a specified period of time.
4.15
Compliance With
Section 409A.
Awards shall be designed,
granted and administered in such a manner that they are either
exempt from the application of, or comply with, the requirements
of Section 409A. If the Committee determines that an Award,
Award Agreement, payment, distribution, deferral election,
transaction, or any other action or arrangement contemplated by
the provisions of the Plan would, if undertaken, cause a Holder
to become subject to additional taxes under Section 409A,
then unless the Committee specifically provides otherwise, such
Award, Award Agreement, payment, distribution, deferral
election, transaction or other action or arrangement shall not
be given effect to the extent it causes such result and the
related provisions of the Plan
and/or
Award
Agreement will be deemed modified, or, if necessary, suspended
in order to comply with the requirements of Section 409A to
the extent determined appropriate by the Committee, in each case
without the consent of or notice to the Holder. The
exercisability of an Option or a SAR shall not be extended to
the extent that such extension would subject the Holder to
additional taxes under Section 409A. This Section 4.15
is effective for awards issued under the Plan that are earned
and vested on or after January 1, 2005.
4.16
Source of Shares Deliverable Under
Awards.
Any shares of Stock delivered pursuant to
an Award may consist, in whole or in part, of authorized and
unissued shares of Stock or of treasury shares of Stock.
IV-5
ARTICLE V
OPTIONS
5.1
Authority to Grant Options.
Subject
to the terms and provisions of the Plan, the Committee, at any
time, and from time to time, may grant Options under the Plan to
eligible persons in such number and upon such terms as the
Committee shall determine.
5.2
Type of Options Available.
Options
granted under the Plan may be Incentive Stock Options intended
to satisfy the requirements of section 422 of the Code or
Nonqualified Stock Options that are not intended to satisfy the
requirements of section 422 of the Code.
5.3
Option Agreement.
Each Option grant
under the Plan shall be evidenced by an Option Agreement that
shall specify (a) whether the Option is intended to be an
ISO or a NQSO, (b) the Option Price, (c) the duration
of the Option, (d) the number of shares of Stock to which
the Option pertains, (e) the exercise restrictions
applicable to the Option, and (f) such other provisions as
the Committee shall determine that are not inconsistent with the
terms and provisions of the Plan. Notwithstanding the
designation of an Option as an ISO in the applicable Option
Agreement, to the extent the limitations of section 422 of
the Code are exceeded with respect to the Option, the portion of
the Option in excess of the limitation shall be treated as a
NQSO. Effective for Options granted under the Plan on or after
January 1, 2005, an Option granted under the Plan may not
be granted with any Dividend Equivalents rights.
5.4
Option Price.
The price at which
shares of Stock may be purchased under an Option (the
Option Price
) shall not be less than
100 percent (100%) of the Fair Market Value of the shares
of Stock on the date the Option is granted. However, in the case
of a Ten Percent Stockholder, the Option Price for an
Incentive Stock Option shall not be less than 110 percent
(110%) of the Fair Market Value of the shares of Stock on the
date the Incentive Stock Option is granted. Subject to the
limitations set forth in the preceding sentences of this
Section 5.4, the Committee shall determine the Option Price
for each grant of an Option under the Plan.
5.5
Duration of Options.
An Option shall
not be exercisable after the earlier of (i) the general
term of the Option specified in Section 5.5(a), or
(ii) the period of time specified herein that follows the
Optionees death, Disability, Retirement or other
Termination of Employment or Termination of Service. Unless the
Optionees applicable Option Agreement specifies otherwise,
an Option shall not continue to vest after the Optionees
Termination of Employment or Termination of Service for any
reason other than the death or Disability of the Optionee.
(a)
General Term of Option.
Unless the
Option Agreement specifies a shorter general term, an Option
shall expire on the tenth anniversary of the date the Option is
granted. Notwithstanding the foregoing, unless the Option
Agreement specifies a shorter term, in the case of an Incentive
Stock Option granted to a Ten Percent Stockholder, the
Option shall expire on the fifth anniversary of the date the
Option is granted.
(b)
Early Termination of Option Due to Termination of
Employment or Termination of Service Other Than for Death,
Disability or Retirement.
Except as may be
otherwise expressly provided by the Committee in an Option
Agreement, an Option shall terminate on the earlier of
(1) the date of the expiration of the general term of the
Option or (2) the date that is one day less than one month
after the date of the Optionees Termination of Employment
or Termination of Service, whether with or without cause, for
any reason other than the death, Disability or Retirement of the
Optionee, during which period the Optionee shall be entitled to
exercise the Option in respect of the number of shares of Stock
that the Optionee would have been entitled to purchase had the
Optionee exercised the Option on the date of such Termination of
Employment or Termination of Service. The Committee shall
determine whether an authorized leave of absence, absence on
military or government service, or any other absence from
service shall constitute a termination of the employment
relationship between the Optionee and the Company and all
Affiliates. Notwithstanding the foregoing, in the case of an
Incentive Stock Option, if an Optionee has an authorized leave
of absence from employment with the Company, a Parent
Corporation or a Subsidiary Corporation that exceeds
90 days and the Optionees right to reemployment is
not guaranteed by either statute or contract, the Optionee will
be deemed to incur a Termination of Employment on the
91
st
day
of such leave.
V-1
(c)
Early Termination of Option Due to
Death.
Unless the Committee specifies otherwise
in the applicable Option Agreement, in the event of the
Optionees Termination of Employment or Termination of
Service due to death before the date of expiration of the
general term of the Option, the Optionees Option shall
terminate on the earlier of the date of expiration of the
general term of the Option or the first anniversary of the date
of the Optionees death, during which period the
Optionees executors or administrators or such persons to
whom such Options were transferred by will or by the laws of
descent and distribution, shall be entitled to exercise the
Option in respect of the number of shares of Stock that the
Optionee would have been entitled to purchase had the Optionee
exercised the Option on the date of his death.
(d)
Early Termination of Option Due to
Disability.
Unless the Committee specifies
otherwise in the applicable Option Agreement, in the event of
the Termination of Employment or Termination of Service due to
Disability before the date of the expiration of the general term
of the Option, the Optionees Option shall terminate on the
earlier of the expiration of the general term of the Option or
the first anniversary of the date of the Termination of
Employment or Termination of Service due to Disability, during
which period the Optionee shall be entitled to exercise the
Option in respect of the number of shares of Stock that the
Optionee would have been entitled to purchase had the Optionee
exercised the Option on the date of such Termination of
Employment or Termination of Service.
(e)
Early Termination of Option Due to
Retirement.
Unless the Committee specifies
otherwise in the applicable Option Agreement, in the event of
the Optionees Termination of Employment or Termination of
Service due to Retirement before the date of the expiration of
the general term of the Option, the Optionees Option shall
terminate on the earlier of the expiration of the general term
of the Option or the first anniversary of the date of the
Termination of Employment or Termination of Service due to
Retirement, during which period the Optionee shall be entitled
to exercise the Option in respect of the number of shares of
Stock that the Optionee would have been entitled to purchase had
the Optionee exercised the Option on the date of such
Termination of Employment or Termination of Service.
After the death of the Optionee, the Optionees executors,
administrators or any person or persons to whom the
Optionees Option may be transferred by will or by the laws
of descent and distribution, shall have the right, at any time
prior to the termination of the Option to exercise the Option,
in respect to the number of all of the remaining unexercised and
unexpired shares of Stock subject to the Option.
5.6
Amount Exercisable.
Each Option may
be exercised at the time, in the manner and subject to the
conditions the Committee specifies in the Option Agreement in
its sole discretion. Unless the Committee specifies otherwise in
an applicable Option Agreement, an Option Agreement shall set
forth the following terms regarding the exercise of the Option
covered by the Option Agreement:
(a) No Option granted under the Plan may be exercised until
an Optionee has completed one year of continuous employment with
the Company or any subsidiary of the Company or one year of
service on the Board following the date of grant;
(b) Beginning on the day after the first anniversary of the
date of grant, an Option may be exercised up to
1
/
3
of the shares subject to the Option;
(c) After the expiration of each succeeding anniversary
date of the date of grant, the Option may be exercised up to an
additional
1
/
3
of the shares initially subject to the Option, so that after the
expiration of the third anniversary of the date of grant, the
Option shall be exercisable in full;
(d) To the extent not exercised, installments shall be
cumulative and may be exercised in whole or in part until the
Option expires on the tenth anniversary of the date of grant.
However, the Committee, in its discretion, may change the terms
of exercise so that any Option may be exercised so long as it is
valid and outstanding from time to time in part or as a whole in
such manner and subject to such conditions as the Committee may
set. In addition, the Committee, in its discretion, may
accelerate the time in which any outstanding Option may be
exercised. However, in no event shall any Option be exercisable
on or after the tenth anniversary of the date of the grant of
the Option.
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5.7
Exercise of Options
.
(a)
General Method of Exercise.
Subject
to the terms and provisions of the Plan and an Optionees
Option Agreement, Options may be exercised in whole or in part
from time to time by the delivery of written notice in the
manner designated by the Committee stating (1) that the
Optionee wishes to exercise such option on the date such notice
is so delivered, (2) the number of shares of Stock with
respect to which the Option is to be exercised and (3) the
address to which the certificate representing such shares of
Stock should be mailed. Except in the case of exercise by a
third party broker as provided below, in order for the notice to
be effective the notice must be accompanied by payment of the
Option Price and any applicable tax withholding amounts which
must be made at the time of exercise by any combination of the
following: (a) cash, certified check, bank draft or postal
or express money order for an amount equal to the Option Price
under the Option, (b) Mature Shares with a Fair Market
Value on the date of exercise equal to the Option Price under
the Option (if approved in advance by the Committee or an
executive officer of the Company), (c) an election to make
a cashless exercise through a registered broker-dealer (if
approved in advance by the Committee or an executive officer of
the Company) or (d) except as specified below, any other
form of payment which is acceptable to the Committee. If Mature
Shares are used for payment by the Optionee, the aggregate Fair
Market Value of the shares of Stock tendered must be equal to or
less than the aggregate Option Price of the shares of Stock
being purchased upon exercise of the Option, and any difference
must be paid by cash, certified check, bank draft or postal or
express money order payable to the order of the Company.
If, at the time of receipt by the Company or its delegate of
such written notice, (i) the Company has unrestricted
surplus in an amount not less than the Option Price of such
shares of Stock, (ii) all accrued cumulative preferential
dividends and other current preferential dividends on all
outstanding shares of preferred stock of the Company have been
fully paid, (iii) the acquisition by the Company of its own
shares of Stock for the purpose of enabling such Optionee to
exercise such Option is otherwise permitted by applicable law,
does not require any vote or consent of any stockholder of the
Company and does not violate the terms of any agreement to which
the Company is a party or by which it is bound, and
(iv) there shall have been adopted, and there shall be in
full force and effect, a resolution of the Board authorizing the
acquisition by the Company of its own shares of stock for such
purpose, then such Optionee may deliver to the Company, in
payment of the Option Price of the shares of Stock with respect
to which such Option is exercised, (x) certificates
registered in the name of such Optionee that represent a number
of shares of stock legally and beneficially owned by such
Optionee (free of all liens, claims and encumbrances of every
kind) and having a Fair Market Value on the date of receipt by
the Company or its delegate of such written notice that is not
greater than the Option Price of the shares of Stock with
respect to which such Option is to be exercised, such
certificates to be accompanied by stock powers duly endorsed in
blank by the record holder of the shares of Stock represented by
such certificates, with the signature of such record holder
guaranteed by a national banking association, and (y) if
the Option Price of the shares of Stock with respect to which
such Option is to be exercised exceeds such Fair Market Value, a
cashiers check drawn on a national banking association and
payable to the order of the Company, in an amount, in United
States dollars, equal to the amount of such excess.
Notwithstanding the provisions of the immediately preceding
sentence, the Committee, in its sole discretion, may refuse to
accept shares of Stock in payment of the Option Price of the
shares of Stock with respect to which such Option is to be
exercised and, in that event, any certificates representing
shares of Stock that were received by the Company or its
delegate with such written notice shall be returned to such
Optionee, together with notice by the Company or its delegate to
such Optionee of the refusal of the Committee to accept such
shares of Stock. If, at the expiration of seven business days
after the delivery to such Optionee of such written notice from
the Company or its delegate, such Optionee shall not have
delivered to the Company or its delegate a cashiers check
drawn on a national banking association and payable to the order
of the Company in an amount, in United States dollars, equal to
the Option Price of the shares of Stock with respect to which
such Option is to be exercised, such written notice from the
Optionee to the Company or its delegate shall be ineffective to
exercise such Option.
Whenever an Option is exercised by exchanging shares of Stock
owned by the Optionee, the Optionee shall deliver to the Company
or its delegate certificates registered in the name of the
Optionee representing a number of shares of Stock legally and
beneficially owned by the Optionee, free of all liens, claims,
and encumbrances of every kind, accompanied by stock powers duly
endorsed in blank by the record holder of the shares represented
by the certificates, (with signature guaranteed by a commercial
bank or trust company or by a brokerage firm having a membership
on a registered national stock exchange). The delivery of
certificates upon the exercise of Option is
V-3
subject to the condition that the person exercising the Option
provide the Company with the information the Company might
reasonably request pertaining to exercise, sale or other
disposition of an Option.
(b)
Issuance of Shares.
Subject to
Section 4.4 and Section 5.7(c), as promptly as
practicable after receipt of written notification and payment,
in the form required by Section 5.7(a), of an amount of
money necessary to satisfy any withholding tax liability that
may result from the exercise of such Option, the Company shall
deliver to the Optionee certificates for the number of shares
with respect to which the Option has been exercised, issued in
the Optionees name. Delivery of the shares shall be deemed
effected for all purposes when a stock transfer agent of the
Company shall have deposited the certificates in the United
States mail, addressed to the Optionee, at the address specified
by the Optionee.
(c)
Exercise Through Third-Party
Broker.
The Committee may permit an Optionee to
elect to pay the Option Price and any applicable tax withholding
resulting from such exercise by authorizing a third-party broker
to sell all or a portion of the shares of Stock acquired upon
exercise of the Option and remit to the Company a sufficient
portion of the sale proceeds to pay the Option Price and any
applicable tax withholding resulting from such exercise.
(d)
Limitations on Exercise
Alternatives.
The Committee shall not permit an
Optionee to pay such Optionees Option Price upon the
exercise of an Option by having the Company reduce the number of
shares of Stock that will be delivered pursuant to the exercise
of the Option. In addition, the Committee shall not permit an
Optionee to pay such Optionees Option Price upon the
exercise of an Option by using shares of Stock other than Mature
Shares. An Option may not be exercised for a fraction of a share
of Stock.
5.8
Transferability of Options
.
(a)
Incentive Stock Options.
No ISO
granted under the Plan may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by
will or by the laws of descent and distribution. Further, all
ISOs granted to an Optionee under the Plan shall be exercisable
during his or her lifetime only by the Optionee, and after that
time, by the Optionees heirs or estate.
(b)
Nonqualified Stock
Options.
Except as otherwise provided
in an Optionees Option Agreement, no NQSO granted under
the Plan may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by
the laws of descent and distribution. Further, except as
otherwise provided in an Optionees Option Agreement, all
NQSOs granted to an Optionee under the Plan shall be exercisable
during his or her lifetime only by such Optionee.
Any attempted assignment of an Option in violation of this
Section 5.8 shall be null and void.
5.9
Notification of Disqualifying
Disposition.
If any Optionee shall make any
disposition of shares of Stock issued pursuant to the exercise
of an ISO under the circumstances described in
section 421(b) of the Code (relating to certain
disqualifying dispositions), such Optionee shall notify the
Company of such disposition within ten (10) days thereof.
5.10
No Rights as Stockholder.
An
Optionee shall not have any rights as a stockholder with respect
to Stock covered by an Option until the date a stock certificate
for such Stock is issued by the Company; and, except as
otherwise provided in Section 4.6, no adjustment for
dividends, or otherwise, shall be made if the record date
therefor is prior to the date of issuance of such certificate.
5.11
$100,000 Limitation on Incentive Stock
Options.
To the extent that the aggregate Fair
Market Value of Stock with respect to which Incentive Stock
Options first become exercisable by a Holder in any calendar
year exceeds $100,000, taking into account both shares of Stock
subject to Incentive Stock Options under the Plan and Stock
subject to incentive stock options under all other plans of the
Company, such Options shall be treated as Nonqualified Stock
Options. For this purpose, the Fair Market Value of
the Stock subject to Options shall be determined as of the date
the Options were awarded. In reducing the number of Options
treated as Incentive Stock Options to meet the $100,000 limit,
the most recently granted Options shall be reduced first. To the
extent a reduction of simultaneously granted Options is
necessary to meet the $100,000 limit, the Committee may, in the
manner and to the extent permitted by law, designate which
shares of Stock are to be treated as shares acquired pursuant to
the exercise of an Incentive Stock Option.
V-4
ARTICLE VI
STOCK APPRECIATION RIGHTS
6.1
Authority to Grant Stock Appreciation Rights
Awards.
Subject to the terms and provisions of
the Plan, the Committee, at any time, and from time to time, may
grant Stock Appreciation Rights under the Plan to eligible
persons in such number and upon such terms as the Committee
shall determine. Subject to the terms and conditions of the
Plan, the Committee shall have complete discretion in
determining the number of SARs granted to each Holder and,
consistent with the provisions of the Plan, in determining the
terms and conditions pertaining to such SARs.
6.2
Type of Stock Appreciation Rights
Available.
SARs granted under the Plan may be
Freestanding SARs, Tandem SARs or any combination of these forms
of SARs.
6.3
General Terms.
Subject to the terms
and conditions of the Plan, a SAR granted under the Plan shall
confer on the recipient a right to receive, upon exercise
thereof, a cash amount equal to the excess of (a) the Fair
Market Value of one share of the Stock on the date of exercise
over (b) the grant price of the SAR, which shall not be
less than 100 percent of the Fair Market Value of one share
of the Stock on the date of grant of the SAR and in no event
less than par value of one share of the Stock. The grant price
of a Freestanding SAR shall not be less than the Fair Market
Value of a share of the Stock on the date of grant of the SAR.
The grant price of a Tandem SAR shall equal the Option Price of
the Option which is related to the Tandem SAR. Effective for
SARs granted under the Plan on or after January 1, 2005, a
SAR granted under the Plan may not be granted with any Dividend
Equivalents rights.
6.4
Stock Appreciation Right
Agreement.
Each Award of SARs granted under the
Plan shall be evidenced by an Award Agreement that shall specify
(a) whether the SAR is intended to be a Freestanding SAR or
a Tandem SAR, (b) the grant price of the SAR, (c) the
term of the SAR, (d) the vesting and termination provisions
and (e) such other provisions as the Committee shall
determine that are not inconsistent with the terms and
provisions of the Plan. The Committee may impose such additional
conditions or restrictions on the exercise of any SAR as it may
deem appropriate.
6.5
Term of Stock Appreciation
Rights.
The term of a SAR granted under the Plan
shall be determined by the Committee, in its sole discretion;
provided that no SAR shall be exercisable on or after the tenth
anniversary date of its grant.
6.6
Exercise of Freestanding
SARs.
Subject to the terms and provisions of the
Plan and the applicable Award Agreement, Freestanding SARs may
be exercised in whole or in part from time to time by the
delivery of written notice in the manner designated by the
Committee stating (a) that the Holder wishes to exercise
such SAR on the date such notice is so delivered, (b) the
number of shares of Stock with respect to which the SAR is to be
exercised and (c) the address to which the payment due
under such SAR should be mailed. In accordance with applicable
law, a Freestanding SAR may be exercised upon whatever
additional terms and conditions the Committee, in its sole
discretion, imposes.
6.7
Exercise of Tandem SARs.
(a) Subject to the terms and provisions of the Plan and the
applicable Award Agreement, Tandem SARs may be exercised for all
or part of the shares of Stock subject to the related Option
upon the surrender of the right to exercise the equivalent
portion of the related Option and by the delivery of written
notice in the manner designated by the Committee stating
(a) that the Holder wishes to exercise such SAR on the date
such notice is so delivered, (b) the number of shares of
Stock with respect to which the SAR is to be exercised and
(c) the address to which the payment due under such SAR
should be mailed. A Tandem SAR may be exercised only with
respect to the shares of Stock for which its related Option is
then exercisable. In accordance with applicable law, a Tandem
SAR may be exercised upon whatever additional terms and
conditions the Committee, in its sole discretion, imposes.
(b) Notwithstanding any other provision of the Plan to the
contrary, with respect to a Tandem SAR granted in connection
with an ISO: (1) the Tandem SAR will expire no later than
the expiration of the underlying ISO; (2) the value of the
payout with respect to the Tandem SAR may be for no more than
100 percent (100%) of the excess of the Fair Market Value
of the shares of Stock subject to the underlying ISO at the time
the Tandem SAR is exercised
VI-1
over the Option Price of the underlying ISO; and (3) the
Tandem SAR may be exercised only when the Fair Market Value of
the shares of Stock subject to the ISO exceeds the Option Price
of the ISO.
6.8
Payment of SAR Amount.
Upon the
exercise of a SAR, an Employee shall be entitled to receive
payment from the Company in an amount determined by multiplying:
(a) The excess of the Fair Market Value of a share of the
Stock on the date of exercise over the grant price of the SAR by
(b) The number of shares of Stock with respect to which the
SAR is exercised.
At the discretion of the Committee, the payment upon SAR
exercise may be in cash, in Stock of equivalent value, in some
combination thereof or in any other manner approved by the
Committee in its sole discretion. The Committees
determination regarding the form of SAR payout shall be set
forth in the Award Agreement pertaining to the grant of the SAR.
6.9
Termination of Employment or Termination of
Service.
Each Award Agreement shall set forth the
extent to which the grantee of a SAR shall have the right to
exercise the SAR following the grantees Termination of
Employment or Termination of Service. Such provisions shall be
determined in the sole discretion of the Committee, may be
included in the Award Agreement entered into with the grantee,
and need not be uniform among all SARs issued pursuant to the
Plan and may reflect distinctions based on the reasons for
termination.
6.10
Nontransferability of SARs.
Except
as otherwise provided in a Holders Award Agreement, no SAR
granted under the Plan may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by
will or by the laws of descent and distribution. Further, except
as otherwise provided in a Holders Award Agreement, all
SARs granted to a Holder under the Plan shall be exercisable
during his or her lifetime only by the Holder, and after that
time, by the Holders heirs or estate. Any attempted
assignment of a SAR in violation of this Section 6.10 shall
be null and void.
6.11
No Rights as Stockholder.
A grantee
of a SAR award, as such, shall have no rights as a stockholder.
6.12
Restrictions on Stock Received.
The
Committee may impose such conditions
and/or
restrictions on any shares of Stock received upon exercise of a
SAR granted pursuant to the Plan as it may deem advisable or
desirable. These restrictions may include, but shall not be
limited to, a requirement that the Holder hold the shares of
Stock received upon exercise of a SAR for a specified period of
time.
VI-2
ARTICLE VII
RESTRICTED STOCK AWARDS
7.1
Restricted Stock Awards.
Subject to
the terms and conditions of the Plan, the Committee, at any
time, and from time to time, may make Awards of Restricted Stock
to eligible persons in such numbers and upon such terms as the
Committee shall determine. The amount of, the vesting and the
transferability restrictions applicable to any Restricted Stock
Award shall be determined by the Committee in its sole
discretion. If the Committee imposes vesting or transferability
restrictions on a Holders rights with respect to
Restricted Stock, the Committee may issue such instructions to
the Companys share transfer agent in connection therewith
as it deems appropriate. The Committee may also cause the
certificate for shares of Stock issued pursuant to a Restricted
Stock Award to be imprinted with any legend which counsel for
the Company considers advisable with respect to the restrictions
or, should the shares of Stock be represented by book or
electronic entry rather than a certificate, the Company may take
such steps to restrict transfer of the shares of Stock as
counsel for the Company considers necessary or advisable to
comply with applicable law.
7.2
Restricted Stock Award
Agreement.
Each Restricted Stock Award shall be
evidenced by an Award Agreement that contains any vesting,
transferability restrictions and other provisions not
inconsistent with the Plan as the Committee may specify.
7.3
Holders Rights as
Stockholder.
Subject to the terms and conditions
of the Plan, each recipient of a Restricted Stock Award shall
have all the rights of a stockholder with respect to the shares
of Restricted Stock included in the Restricted Stock Award
during the Period of Restriction established for the Restricted
Stock Award. Dividends paid with respect to Restricted Stock in
cash or property other than shares of Stock or rights to acquire
shares of Stock shall be paid to the recipient of the Restricted
Stock Award currently. Dividends paid in shares of Stock or
rights to acquire shares of Stock shall be added to and become a
part of the Restricted Stock. During the Period of Restriction,
certificates representing the Restricted Stock shall be
registered in the recipients name and bear a restrictive
legend to the effect that ownership of such Restricted Stock,
and the enjoyment of all rights appurtenant thereto, are subject
to the restrictions, terms, and conditions provided in the Plan
and the applicable Restricted Stock Award Agreement. Such
certificates shall be deposited by the recipient with the
Secretary of the Company or such other officer of the Company as
may be designated by the Committee, together with all stock
powers or other instruments of assignment, each endorsed in
blank, which will permit transfer to the Company of all or any
portion of the Restricted Stock which shall be forfeited in
accordance with the Plan and the applicable Restricted Stock
Award Agreement.
VII-1
ARTICLE VIII
DEFERRED
STOCK UNIT AWARDS
8.1
Authority to Grant Deferred Stock Unit
Awards.
Subject to the terms and provisions of
the Plan, the Committee, at any time, and from time to time, may
grant Deferred Stock Units under the Plan to eligible persons in
such amounts and upon such terms as the Committee shall
determine. The amount of, the vesting and the transferability
restrictions applicable to any Deferred Stock Unit Award shall
be determined by the Committee in its sole discretion. The
Committee shall maintain a bookkeeping ledger account which
reflects the number of Deferred Stock Units credited under the
Plan for the benefit of a Holder.
8.2
Deferred Stock Unit Awards.
A
Deferred Stock Unit shall be similar in nature to Restricted
Stock except that no shares of Stock are actually transferred to
the Holder until a later date specified in the applicable Award
Agreement. Each Deferred Stock Unit shall have a value equal to
the Fair Market Value of a share of Stock.
8.3
Deferred Stock Unit Award
Agreement.
Each Deferred Stock Unit Award shall
be evidenced by an Award Agreement that contains any Substantial
Risk of Forfeiture, vesting, transferability restrictions, form
and time of payment provisions and other provisions not
inconsistent with the Plan as the Committee may specify.
8.4
Dividend Equivalents.
Effective for
Deferred Stock Awards granted under the Plan on or after
January 1, 2005, an Award Agreement for a Deferred Stock
Unit Award may specify that the Holder shall be entitled to the
payment of Dividend Equivalents under the Award.
8.5
Form of Payment Under Deferred Stock Unit
Award.
Payment under a Deferred Stock Unit Award
shall be made in either cash or shares of Stock as specified in
the applicable Award Agreement.
8.6
Time of Payment Under Deferred Stock Unit
Award.
A Holders payment under a Deferred
Stock Unit Award shall be made at such time as is specified in
the applicable Award Agreement. The Award Agreement shall
specify that the payment will be made (a) by a date that is
no later than the date that is two and one-half
(2
1
/
2
)
months after the end of the Fiscal Year in which the Deferred
Stock Unit Award payment is no longer subject to a Substantial
Risk of Forfeiture or (b) at a time that is permissible
under Section 409A. This Section 8.6 is effective for
awards issued under the Plan that are earned and vested on or
after January 1, 2005.
8.7
Holders Rights as
Stockholder.
Each recipient of Deferred Stock
Units shall have no rights of a stockholder with respect to the
Holders Deferred Stock Units. A Holder shall have no
voting rights with respect to any Deferred Stock Unit Awards.
VIII-1
ARTICLE IX
PERFORMANCE
STOCK AND PERFORMANCE UNIT AWARDS
9.1
Authority to Grant Performance Stock and Performance
Unit Awards.
Subject to the terms and provisions
of the Plan, the Committee, at any time, and from time to time,
may grant Performance Stock and Performance Unit Awards under
the Plan to eligible persons in such amounts and upon such terms
as the Committee shall determine. The amount of, the vesting and
the transferability restrictions applicable to any Performance
Stock or Performance Unit Award shall be based upon the
attainment of such Performance Goals as the Committee may
determine. A Performance Goal for a particular Performance Stock
or Performance Unit Award must be established by the Committee
prior to the earlier to occur of (a) 90 days after the
commencement of the period of service to which the Performance
Goal relates or (b) the lapse of 25 percent of the
period of service, and in any event while the outcome is
substantially uncertain. A Performance Goal must be objective
such that a third party having knowledge of the relevant facts
could determine whether the goal is met. Such a Performance Goal
may be based on one or more business criteria that apply to the
Employee, one or more business units of the Company, or the
Company as a whole, with reference to one or more of the
following: earnings per share, earnings per share growth, total
shareholder return, economic value added, cash return on
capitalization, increased revenue, revenue ratios (per employee
or per customer), net income, stock price, market share, return
on equity, return on assets, return on capital, return on
capital compared to cost of capital, return on capital employed,
return on invested capital, shareholder value, net cash flow,
operating income, earnings before interest and taxes, cash flow,
cash flow from operations, cost reductions, cost ratios (per
employee or per customer), proceeds from dispositions, project
completion time and budget goals, net cash flow before financing
activities, customer growth and total market value. Goals may
also be based on performance relative to a peer group of
companies. Unless otherwise stated, such a Performance Goal need
not be based upon an increase or positive result under a
particular business criterion and could include, for example,
maintaining the status quo or limiting economic losses
(measured, in each case, by reference to specific business
criteria). In interpreting Plan provisions applicable to
Performance Goals and Performance Stock or Performance Unit
Awards, it is intended that the Plan will conform with the
standards of section 162(m) of the Code and Treasury
Regulations § 1.162-27(e)(2)(i), and the Committee in
establishing such goals and interpreting the Plan shall be
guided by such provisions. Prior to the payment of any
compensation based on the achievement of Performance Goals, the
Committee must certify in writing that applicable Performance
Goals and any of the material terms thereof were, in fact,
satisfied. Subject to the foregoing provisions, the terms,
conditions and limitations applicable to any Performance Stock
or Performance Unit Awards made pursuant to the Plan shall be
determined by the Committee. If the Committee imposes vesting or
transferability restrictions on a recipients rights with
respect to Performance Stock or Performance Unit Awards, the
Committee may issue such instructions to the Companys
share transfer agent in connection therewith as it deems
appropriate. The Committee may also cause the certificate for
shares of Stock issued pursuant to a Performance Stock or
Performance Unit Award to be imprinted with any legend which
counsel for the Company considers advisable with respect to the
restrictions or, should the shares of Stock be represented by
book or electronic entry rather than a certificate, the Company
may take such steps to restrict transfer of the shares of Stock
as counsel for the Company considers necessary or advisable to
comply with applicable law.
Each Performance Stock or Performance Unit Award shall be
evidenced by an Award Agreement that contains any vesting,
transferability restrictions and other provisions not
inconsistent with the Plan as the Committee may specify.
9.2
Time of Payment Under Performance Unit
Award.
A Holders payment under a
Performance Unit Award shall be made at such time as is
specified in the applicable Award Agreement. The Award Agreement
shall specify that the payment will be made (a) by a date
that is no later than the date that is two and one-half
(2
1
/
2
)
months after the end of the calendar year in which the
Performance Unit Award payment is no longer subject to a
Substantial Risk of Forfeiture or (b) at a time that is
permissible under Section 409A. This Section 9.2 is
effective for awards issued under the Plan that are earned and
vested on or after January 1, 2005.
9.3
Holders Rights as Stockholder With Respect to
a Performance Stock Award.
Subject to the terms
and conditions of the Plan, each Holder of a Performance Stock
Award shall have all the rights of a stockholder with respect to
the shares of Stock issued to the Holder pursuant to the Award
during any period in which such issued
IX-1
shares of Stock are subject to forfeiture and restrictions on
transfer, including without limitation, the right to vote such
shares of Stock.
9.4
Increases Prohibited.
Neither the
Committee nor the Board may increase the amount of compensation
payable under a Performance Stock Award or Performance Unit
Award. If the time at which a Performance Stock Award or
Performance Unit Award will vest or be paid is accelerated for
any reason, the number of shares of Stock subject to, or the
amount payable under, the Performance Stock Award or Performance
Unit Award shall be reduced pursuant to Department of Treasury
Regulation § 1.162-27(e)(2)(iii) to reasonably reflect
the time value of money.
9.5
Stockholder Approval.
No payments of
Stock or cash will be made pursuant to this Article IX
unless the stockholder approval requirements of Department of
Treasury Regulation § 1.162-27(e)(4) are satisfied.
9.6
Dividend Equivalents.
Effective for
Performance Unit Awards granted under the Plan on or after
January 1, 2005, an Award Agreement for a Performance Unit
Award may specify that the Holder shall be entitled to the
payment of Dividend Equivalents under the Award.
IX-2
ARTICLE X
CASH-BASED
AWARDS AND OTHER STOCK-BASED AWARDS
10.1
Authority to Grant Cash-Based
Awards.
Subject to the terms and provisions of
the Plan, the Committee, at any time, and from time to time, may
grant Cash-Based Awards under the Plan to Employees in such
amounts and upon such terms, including the achievement of
specific performance goals, as the Committee shall determine.
10.2
Authority to Grant Other Stock-Based
Awards.
Subject to the terms and provisions of
the Plan, the Committee, at any time, and from time to time, may
grant other types of equity-based or equity-related Awards not
otherwise described by the terms and provisions of the Plan
(including the grant or offer for sale of unrestricted shares of
Stock) under the Plan to eligible persons in such amounts and
subject to such terms and conditions, as the Committee shall
determine. Such Awards may involve the transfer of actual shares
of Stock to Holders, or payment in cash or otherwise of amounts
based on the value of shares of Stock and may include, without
limitation, Awards designed to comply with or take advantage of
the applicable local laws of jurisdictions other than the United
States.
10.3
Value of Cash-Based and Other Stock-Based
Awards.
Each Cash-Based Award shall specify a
payment amount or payment range as determined by the Committee.
Each Other Stock-Based Award shall be expressed in terms of
shares of Stock or units based on shares of Stock, as determined
by the Committee. The Committee may establish performance goals
in its discretion for Cash-Based Awards and Other Stock-Based
Awards. If the Committee exercises its discretion to establish
performance goals, the number
and/or
value
of Cash-Based Awards or Other Stock-Based Awards that will be
paid out to the Holder will depend on the extent to which the
performance goals are met.
10.4
Payment of Cash-Based Awards and Other Stock-Based
Awards.
Payment, if any, with respect to a
Cash-Based Award or an Other Stock-Based Award shall be made in
accordance with the terms of the Award, in cash or shares of
Stock as the Committee determines.
10.5
Termination of Employment or Service
.
The Committee shall determine the extent to
which a grantees rights with respect to Cash-Based Awards
and Other Stock-Based Awards shall be affected by the
grantees Termination of Employment or Termination of
Service. Such provisions shall be determined in the sole
discretion of the Committee and need not be uniform among all
Awards of Cash-Based Awards and Other Stock-Based Awards issued
pursuant to the Plan.
10.6
Nontransferability.
Except as
otherwise determined by the Committee, neither Cash-Based Awards
nor Other Stock-Based Awards may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by
will or by the laws of descent and distribution. Further, except
as otherwise provided by the Committee, a Holders rights
under the Plan, if exercisable, shall be exercisable during his
or her lifetime only by such Holder.
X-1
ARTICLE XI
SUBSTITUTION
AWARDS
Awards may be granted under the Plan from time to time in
substitution for stock options and other awards held by
employees and directors of other corporations who are about to
become Employees, or whose employer is about to become a parent
or subsidiary corporation as contemplated in Section 3.1,
conditioned in the case of an Incentive Stock Option upon the
employee becoming an employee of the Company or a parent or
subsidiary corporation of the Company, as the result of a merger
of consolidation of the Company with another corporation, or the
acquisition by the Company of substantially all the assets of
another corporation, or the acquisition by the Company of at
least 50 percent (50%) of the issued and outstanding stock
of another corporation as the result of which it becomes a
subsidiary of the Company. The terms and conditions of the
substitute Awards so granted may vary from the terms and
conditions set forth in the Plan to such extent as the Board at
the time of grant may deem appropriate to conform, in whole or
in part, to the provisions of the Award in substitution for
which they are granted, but with respect to Options that are
Incentive Stock Options, no such variation shall be such as to
affect the status of any such substitute Option as an incentive
stock option under section 422 of the Code.
XI-1
ARTICLE XII
ADMINISTRATION
12.1
Awards.
The Plan shall be
administered by the Committee or, in the absence of the
Committee or in the case of awards issued to Directors, the Plan
shall be administered by the Board. The members of the Committee
(that is not itself the Board) shall serve at the discretion of
the Board. The Committee shall have full and exclusive power and
authority to administer the Plan and to take all actions that
the Plan expressly contemplates or are necessary or appropriate
in connection with the administration of the Plan with respect
to Awards granted under the Plan.
12.2
Authority of the Committee.
The
Committee shall have full and exclusive power to interpret and
apply the terms and provisions of the Plan and Awards made under
the Plan, and to adopt such rules, regulations and guidelines
for implementing the Plan as the Committee may deem necessary or
proper, all of which powers shall be exercised in the best
interests of the Company and in keeping with the objectives of
the Plan. A majority of the members of the Committee shall
constitute a quorum for the transaction of business, and the
vote of a majority of those members present at any meeting shall
decide any question brought before that meeting. Any decision or
determination reduced to writing and signed by a majority of the
members shall be as effective as if it had been made by a
majority vote at a meeting properly called and held. All
questions of interpretation and application of the Plan, or as
to Awards granted under the Plan, shall be subject to the
determination, which shall be final and binding, of a majority
of the whole Committee. When appropriate, the Plan shall be
administered in order to qualify certain of the Options granted
hereunder as Incentive Stock Options. No member of the Committee
shall be liable for any act or omission of any other member of
the Committee or for any act or omission on his own part,
including but not limited to the exercise of any power or
discretion given to him under the Plan, except those resulting
from his own gross negligence or willful misconduct. In carrying
out its authority under the Plan, the Committee shall have full
and final authority and discretion, including but not limited to
the following rights, powers and authorities, to:
(a) determine the persons to whom and the time or times at
which Awards will be made;
(b) determine the number and exercise price of shares of
Stock covered in each Award, subject to the terms and provisions
of the Plan;
(c) determine the terms, provisions and conditions of each
Award, which need not be identical and need not match the
default terms set forth in the Plan;
(d) accelerate the time at which any outstanding Award will
vest;
(e) prescribe, amend and rescind rules and regulations
relating to administration of the Plan; and
(f) make all other determinations and take all other
actions deemed necessary, appropriate or advisable for the
proper administration of the Plan.
The Committee may make an Award to an individual who the Company
expects to become an Employee of the Company or any of its
Affiliates within six (6) months after the date of grant of
the Award, with the Award being subject to and conditioned on
the individual actually becoming an Employee within that time
period and subject to other terms and conditions as the
Committee may establish. The Committee may correct any defect or
supply any omission or reconcile any inconsistency in the Plan
or in any Award to a Holder in the manner and to the extent the
Committee deems necessary or desirable to further the
Plans objectives. Further, the Committee shall make all
other determinations that may be necessary or advisable for the
administration of the Plan. As permitted by law and the terms
and provisions of the Plan, the Committee may delegate its
authority as identified in this Section 12.2.
XII-1
The actions of the Committee in exercising all of the rights,
powers, and authorities set out in this Article XII and all
other Articles of the Plan, when performed in good faith and in
its sole judgment, shall be final, conclusive and binding on all
persons. The Committee may employ attorneys, consultants,
accountants, agents, and other persons, any of whom may be an
Employee, and the Committee, the Company, and its officers and
Board shall be entitled to rely upon the advice, opinions, or
valuations of any such persons.
12.3
Decisions Binding.
All
determinations and decisions made by the Committee and the Board
pursuant to the provisions of the Plan and all related orders
and resolutions of the Committee and the Board shall be final,
conclusive and binding on all persons, including the Company,
its stockholders, Employees, Holders and the estates and
beneficiaries of Employees and Holders.
12.4
No Liability.
Under no circumstances
shall the Company, the Board or the Committee incur liability
for any indirect, incidental, consequential or special damages
(including lost profits) of any form incurred by any person,
whether or not foreseeable and regardless of the form of the act
in which such a claim may be brought, with respect to the Plan
or the Companys or the Committees or the
Boards roles in connection with the Plan.
XII-2
ARTICLE XIII
AMENDMENT OR
TERMINATION OF PLAN
13.1
Amendment, Modification, Suspension, and
Termination.
Subject to Section 13.2 the
Committee may, at any time and from time to time, alter, amend,
modify, suspend, or terminate the Plan and any Award Agreement
in whole or in part; provided, however, that, without the prior
approval of the Companys stockholders and except as
provided in Section 4.6, the Committee shall not directly
or indirectly lower the Option Price of a previously granted
Option or the grant price of a previously granted SAR issued
under the Plan, and no amendment of the Plan shall be made
without stockholder approval if stockholder approval is required
by applicable law or stock exchange rules.
13.2
Awards Previously
Granted.
Notwithstanding any other provision of
the Plan to the contrary, no termination, amendment, suspension,
or modification of the Plan or an Award Agreement shall
adversely affect in any material way any Award previously
granted under the Plan, without the written consent of the
Holder holding such Award.
XIII-1
ARTICLE XIV
MISCELLANEOUS
14.1
Unfunded Plan/No Establishment of a
Trust Fund.
Holders shall have no right,
title, or interest whatsoever in or to any investments that the
Company or any of its Affiliates may make to aid in meeting
obligations under the Plan. Nothing contained in the Plan, and
no action taken pursuant to its provisions, shall create or be
construed to create a trust of any kind, or a fiduciary
relationship between the Company and any Holder, beneficiary,
legal representative, or any other person. To the extent that
any person acquires a right to receive payments from the Company
under the Plan, such right shall be no greater than the right of
an unsecured general creditor of the Company. All payments to be
made hereunder shall be paid from the general funds of the
Company and no special or separate fund shall be established and
no segregation of assets shall be made to assure payment of such
amounts, except as expressly set forth in the Plan. No property
shall be set aside nor shall a trust fund of any kind be
established to secure the rights of any Holder under the Plan.
All Holders shall at all times rely solely upon the general
credit of the Company for the payment of any benefit which
becomes payable under the Plan. The Plan is not intended to be
subject to the Employee Retirement Income Security Act of 1974,
as amended.
14.2
No Employment Obligation.
The
granting of any Award shall not constitute an employment
contract, express or implied, nor impose upon the Company or any
Affiliate any obligation to employ or continue to employ, or
utilize the services of, any Holder. The right of the Company or
any Affiliate to terminate the employment of, or provision of
services by, any person shall not be diminished or affected by
reason of the fact that an Award has been granted to him, and
nothing in the Plan or an Award Agreement shall interfere with
or limit in any way the right of the Company or its Affiliates
to terminate any Holders employment or provision of
service to the Company at any time or for any reason not
prohibited by law.
14.3
Tax Withholding.
The Company or any
Affiliate shall be entitled to deduct from other compensation
payable to each Holder any sums required by federal, state or
local tax law to be withheld with respect to the vesting or
exercise of an Award or lapse of restrictions on an Award. In
the alternative, the Company may require the Holder (or other
person validly exercising the Award) to pay such sums for taxes
directly to the Company or any Affiliate in cash or by check
within ten days after the date of vesting, exercise or lapse of
restrictions. In the discretion of the Committee, and with the
consent of the Holder, the Company may reduce the number of
shares of Stock issued to the Holder upon such Holders
exercise of an Option to satisfy the tax withholding obligations
of the Company or an Affiliate; provided that the Fair Market
Value of the shares of Stock held back shall not exceed the
Companys or the Affiliates Minimum Statutory
Withholding Tax Obligations. The Committee may, in its
discretion, permit a Holder to satisfy any Minimum Statutory
Withholding Tax Obligations arising upon the vesting of Award by
delivering to the Holder of the Award a reduced number of shares
of Stock in the manner specified herein. If permitted by the
Committee and acceptable to the Holder, at the time of vesting
of shares of under the Award, the Company shall
(a) calculate the amount of the Companys or an
Affiliates Minimum Statutory Withholding Tax Obligations
on the assumption that all such shares of Stock vested under the
Award are made available for delivery, (b) reduce the
number of such shares of Stock made available for delivery so
that the Fair Market Value of the shares of Stock withheld on
the vesting date approximates the Companys or an Affiliate
Minimum Statutory Withholding Tax Obligation and (c) in
lieu of the withheld shares of Stock, remit cash to the United
States Treasury
and/or
other
applicable governmental authorities, on behalf of the Holder, in
the amount of the Minimum Statutory Withholding Tax Obligations
due. The Company shall withhold only whole shares of Stock to
satisfy its Minimum Statutory Withholding Tax Obligations. Where
the Fair Market Value of the withheld shares of Stock does not
equal the amount of the Minimum Statutory Withholding Tax
Obligations, the Company shall withhold shares of Stock with a
Fair Market Value slightly less than the amount of its Minimum
Statutory Withholding Tax Obligation and the Holder must satisfy
the remaining Minimum Statutory Withholding Tax Obligation in
some other manner permitted under this Section 14.3. The
withheld shares of Stock not made available for delivery by the
Company shall be retained as treasury shares or will be
cancelled and, in either case, the Holders right, title
and interest in such shares of Stock shall terminate. The
Company shall have no obligation upon vesting or exercise of any
Award or lapse of restrictions on an Award until the Company or
an Affiliate has received payment sufficient to cover the
Minimum Statutory Withholding Tax Obligation with respect to
that vesting, exercise or lapse of restrictions. Neither the
Company nor any Affiliate shall be obligated to advise a Holder
of the existence of the tax or the amount which it will be
required to withhold.
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14.4
Written Agreement.
Each Award shall
be embodied in a written agreement or statement which shall be
subject to the terms and conditions of the Plan. The Award
Agreement shall be signed by a member of the Committee on behalf
of the Committee and the Company or by an executive officer of
the Company, other than the Holder, on behalf of the Company,
and may be signed by the Holder to the extent required by the
Committee. The Award Agreement may contain any other provisions
that the Committee in its discretion shall deem advisable which
are not inconsistent with the terms and provisions of the Plan.
14.5
Indemnification of the
Committee.
The Company shall indemnify each
present and future member of the Committee against, and each
member of the Committee shall be entitled without further action
on his or her part to indemnity from the Company for, all
expenses (including attorneys fees, the amount of
judgments and the amount of approved settlements made with a
view to the curtailment of costs of litigation, other than
amounts paid to the Company itself) reasonably incurred by such
member in connection with or arising out of any action, suit or
proceeding in which such member may be involved by reason of
such member being or having been a member of the Committee,
whether or not he or she continues to be a member of the
Committee at the time of incurring the expenses, including,
without limitation, matters as to which such member shall be
finally adjudged in any action, suit or proceeding to have been
negligent in the performance of such members duty as a
member of the Committee. However, this indemnity shall not
include any expenses incurred by any member of the Committee in
respect of matters as to which such member shall be finally
adjudged in any action, suit or proceeding to have been guilty
of gross negligence or willful misconduct in the performance of
his duty as a member of the Committee. In addition, no right of
indemnification under the Plan shall be available to or
enforceable by any member of the Committee unless, within
60 days after institution of any action, suit or
proceeding, such member shall have offered the Company, in
writing, the opportunity to handle and defend same at its own
expense. This right of indemnification shall inure to the
benefit of the heirs, executors or administrators of each member
of the Committee and shall be in addition to all other rights to
which a member of the Committee may be entitled as a matter of
law, contract or otherwise.
14.6
Gender and Number.
If the context
requires, words of one gender when used in the Plan shall
include the other and words used in the singular or plural shall
include the other.
14.7
Severability.
In the event any
provision of the Plan shall be held illegal or invalid for any
reason, the illegality or invalidity shall not affect the
remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been
included.
14.8
Headings.
Headings of Articles and
Sections are included for convenience of reference only and do
not constitute part of the Plan and shall not be used in
construing the terms and provisions of the Plan.
14.9
Other Compensation Plans.
The
adoption of the Plan shall not affect any other option,
incentive or other compensation or benefit plans in effect for
the Company or any Affiliate, nor shall the Plan preclude the
Company from establishing any other forms of incentive
compensation arrangements for Employees.
14.10
Other Awards.
The grant of an Award
shall not confer upon the Holder the right to receive any future
or other Awards under the Plan, whether or not Awards may be
granted to similarly situated Holders, or the right to receive
future Awards upon the same terms or conditions as previously
granted.
14.11
Successors.
All obligations of the
Company under the Plan with respect to Awards granted hereunder
shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all
or substantially all of the business
and/or
assets of the Company.
14.12
Law Limitations/Governmental
Approvals.
The granting of Awards and the
issuance of shares of Stock under the Plan shall be subject to
all applicable laws, rules, and regulations, and to such
approvals by any governmental agencies or national securities
exchanges as may be required.
14.13
Delivery of Title.
The Company
shall have no obligation to issue or deliver evidence of title
for shares of Stock issued under the Plan prior to:
(a) obtaining any approvals from governmental agencies that
the Company determines are necessary or advisable; and
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(b) completion of any registration or other qualification
of the Stock under any applicable national or foreign law or
ruling of any governmental body that the Company determines to
be necessary or advisable.
14.14
Inability to Obtain Authority.
The
inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the
Companys counsel to be necessary to the lawful issuance
and sale of any shares of Stock hereunder, shall relieve the
Company of any liability in respect of the failure to issue or
sell such shares of Stock as to which such requisite authority
shall not have been obtained.
14.15
Investment Representations.
The
Committee may require any person receiving Stock pursuant to an
Award under the Plan to represent and warrant in writing that
the person is acquiring the shares of Stock for investment and
without any present intention to sell or distribute such Stock.
14.16
Persons Residing Outside of the United
States.
Notwithstanding any provision of the Plan
to the contrary, in order to comply with the laws in other
countries in which the TMW Group operates or has Employees, the
Committee, in its sole discretion, shall have the power and
authority to:
(a) determine which Affiliates shall be covered by the Plan;
(b) determine which persons employed outside the United
States are eligible to participate in the Plan;
(c) amend or vary the terms and provisions of the Plan and
the terms and conditions of any Award granted to persons who
reside outside the United States;
(d) establish subplans and modify exercise procedures and
other terms and procedures to the extent such actions may be
necessary or advisable any subplans and
modifications to Plan terms and procedures established under
this Section 14.16 by the Committee shall be attached to
the Plan document as Appendices; and
(e) take any action, before or after an Award is made, that
it deems advisable to obtain or comply with any necessary local
government regulatory exemptions or approvals.
Notwithstanding the above, the Committee may not take any
actions hereunder, and no Awards shall be granted, that would
violate the Exchange Act, the Code, any securities law or
governing statute or any other applicable law.
14.17
No Fractional Shares.
No fractional
shares of Stock shall be issued or delivered pursuant to the
Plan or any Award. The Committee shall determine whether cash,
additional Awards, or other property shall be issued or paid in
lieu of fractional shares of Stock or whether such fractional
shares or any rights thereto shall be forfeited or otherwise
eliminated.
14.18
Arbitration of Disputes.
Any
controversy arising out of or relating to the Plan or an Option
Agreement shall be resolved by arbitration conducted pursuant to
the arbitration rules of the American Arbitration Association.
The arbitration shall be final and binding on the parties.
14.19
Governing Law.
The provisions of
the Plan and the rights of all persons claiming thereunder shall
be construed, administered and governed under the laws of the
State of Texas.
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