Exhibit
10.1
THERMO
FISHER SCIENTIFIC INC.
2008 STOCK INCENTIVE PLAN
1.
Purpose
The purpose of this 2008 Stock Incentive Plan (the
Plan) of Thermo Fisher Scientific Inc., a Delaware
corporation (the Company), is to advance the
interests of the Companys stockholders by enhancing the
Companys ability to attract, retain and motivate persons
who are expected to make important contributions to the Company
and by providing such persons with equity ownership
opportunities and performance-based incentives that are intended
to better align the interests of such persons with those of the
Companys stockholders. Except where the context otherwise
requires, the term Company shall include any of the
Companys present or future parent or subsidiary
corporations as defined in Sections 424(e) or (f) of
the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the Code) and
any other business venture (including, without limitation, joint
venture or limited liability company) in which the Company has a
controlling interest.
2.
Eligibility
All of the Companys employees, officers, directors,
consultants and advisors are eligible to be granted options,
stock appreciation rights (SARs), restricted stock,
restricted stock units (RSUs) and other stock-based
awards (each, an Award) under the Plan. Each person
who receives an award under the Plan is deemed a
Participant.
3.
Administration and
Delegation
(a)
Administration by Board
of Directors.
The Plan will be administered
by the Board of Directors of the Company (the
Board). The Board shall have authority to grant
Awards and to adopt, amend and repeal such administrative rules,
guidelines and practices relating to the Plan as it shall deem
advisable. The Board may construe and interpret the terms of the
Plan and any Award agreements entered into under the Plan. The
Board may correct any defect, supply any omission or reconcile
any inconsistency in the Plan or any Award in the manner and to
the extent it shall deem expedient to carry the Plan into effect
and it shall be the sole and final judge of such expediency. All
decisions by the Board shall be made in the Boards sole
discretion and shall be final and binding on all persons having
or claiming any interest in the Plan or in any Award. No
director or person acting pursuant to the authority delegated by
the Board shall be liable for any action or determination
relating to or under the Plan made in good faith.
(b)
Appointment of
Committees.
To the extent permitted by
applicable law, the Board may delegate any or all of its powers
under the Plan to one or more committees or subcommittees of the
Board (a Committee). All references in the Plan to
the Board shall mean the Board or a Committee of the
Board or the officers referred to in Section 3(c) to the
extent that the Boards powers or authority under the Plan
have been delegated to such Committee or officers.
(c)
Delegation to
Officers.
To the extent permitted by
applicable law, the Board may delegate to one or more officers
of the Company the power to grant Awards (subject to any
limitations under the Plan) to employees or officers of the
Company and to exercise such other powers under the Plan as the
Board may determine, provided that the Board shall fix the terms
of the Awards to be granted by such officers (including the
exercise price of such Awards, which may include a formula by
which the exercise price will be determined) and the maximum
number of shares subject to Awards that the officers may grant;
provided further, however, that no officer shall be authorized
to grant Awards to any executive officer of the
Company (as defined by
Rule 3b-7
under the Securities Exchange Act of 1934, as amended (the
Exchange Act)) or to any officer of the
Company (as defined by
Rule 16a-1
under the Exchange Act).
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4.
Stock Available for
Awards
(a)
Number of Shares; Share
Counting.
(1)
Authorized Number of
Shares.
Subject to adjustment under
Section 9, Awards may be made under the Plan for up to
25,000,000 shares of common stock, $1.00 par value per
share, of the Company (the Common Stock). Shares
issued under the Plan may consist in whole or in part of
authorized but unissued shares or treasury shares.
(2)
Share
Counting.
For purposes of counting the number
of shares available for the grant of Awards under the Plan and
under the sublimits contained in Sections 4(b)(2) and
4(b)(3), (i) all shares of Common Stock covered by
independent SARs shall be counted against the number of shares
available for the grant of Awards; provided, however, that
independent SARs that may be settled in cash only shall not be
so counted; (ii) if any Award (A) expires or is
terminated, surrendered or canceled without having been fully
exercised or is forfeited in whole or in part (including as the
result of shares of Common Stock subject to such Award being
repurchased by the Company at the original issuance price
pursuant to a contractual repurchase right) or (B) results
in any Common Stock not being issued (including as a result of
an independent SAR that was settleable either in cash or in
stock actually being settled in cash), the unused Common Stock
covered by such Award shall again be available for the grant of
Awards; provided, however, in the case of Incentive Stock
Options (as hereinafter defined), the foregoing shall be subject
to any limitations under the Code; and provided further, in the
case of independent SARs, that the full number of shares subject
to any stock-settled SAR shall be counted against the shares
available under the Plan and against the sublimit set forth in
Section 4(b)(2) regardless of the number of shares actually
used to settle such SAR upon exercise; (iii) shares of
Common Stock delivered to the Company by a Participant to
(A) purchase shares of Common Stock upon the exercise of an
Award or (B) satisfy tax withholding obligations (including
shares retained from the Award creating the tax obligation)
shall not be added back to the number of shares available for
the future grant of Awards; and (iv) shares of Common Stock
repurchased by the Company on the open market using the proceeds
from the exercise of an Award shall not increase the number of
shares available for future grant of Awards.
(b)
Sub-limits.
Subject
to adjustment under Section 10, the following sub-limits on
the number of shares subject to Awards shall apply:
(1)
Section 162(m)
Per-Participant Limit.
The maximum number of
shares of Common Stock with respect to which Awards may be
granted to any Participant under the Plan shall be 2,000,000 per
calendar year. For purposes of the foregoing limit, the
combination of an Option in tandem with a SAR (as each is
hereafter defined) shall be treated as a single Award. The
per-Participant limit described in this Section 4(b)(1)
shall be construed and applied consistently with
Section 162(m) of the Code or any successor provision
thereto, and the regulations thereunder
(Section 162(m)).
(2)
Limit on Awards other
than Options and SARS.
The maximum number of
shares with respect to which Awards other than Options and SARs
may be granted shall be 7,000,000.
(3)
Limit on Awards to
Directors.
The maximum number of shares with
respect to which Awards may be granted to directors who are not
employees of the Company at the time of grant shall be 1,200,000.
(c)
Substitute
Awards.
In connection with a merger or
consolidation of an entity with the Company or the acquisition
by the Company of property or stock of an entity, the Board may
grant Awards in substitution for any options or other stock or
stock-based awards granted by such entity or an affiliate
thereof. Substitute Awards may be granted on such terms as the
Board deems appropriate in the circumstances, notwithstanding
any limitations on Awards contained in the Plan. Substitute
Awards shall not count against the overall share limit set forth
in Section 4(a)(1) or any sublimits contained in the Plan,
except as may be required by reason of Section 422 and
related provisions of the Code.
5.
Stock Options
(a)
General.
The
Board may grant options to purchase Common Stock (each, an
Option) and determine the number of shares of Common
Stock to be covered by each Option, the exercise price of each
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Option and the conditions and limitations applicable to the
exercise of each Option, including conditions relating to
applicable federal or state securities laws, as it considers
necessary or advisable. An Option that is not intended to be an
Incentive Stock Option (as hereinafter defined) shall be
designated a Nonstatutory Stock Option.
(b)
Incentive Stock
Options.
An Option that the Board intends to
be an incentive stock option as defined in
Section 422 of the Code (an Incentive Stock
Option) shall only be granted to employees of Thermo
Fisher Scientific Inc., any of Thermo Fisher Scientific
Inc.s present or future parent or subsidiary corporations
as defined in Sections 424(e) or (f) of the Code, and
any other entities the employees of which are eligible to
receive Incentive Stock Options under the Code, and shall be
subject to and shall be construed consistently with the
requirements of Section 422 of the Code. The Company shall
have no liability to a Participant, or any other party, if an
Option (or any part thereof) that is intended to be an Incentive
Stock Option is not an Incentive Stock Option or for any action
taken by the Board, including without limitation the conversion
of an Incentive Stock Option to a Nonstatutory Stock Option.
(c)
Exercise
Price.
The Board shall establish the exercise
price of each Option and specify the exercise price in the
applicable option agreement. The exercise price shall be not
less than 100% of the Fair Market Value (as defined below) on
the date the Option is granted; provided that if the Board
approves the grant of an Option with an exercise price to be
determined on a future date, the exercise price shall be not
less than 100% of the Fair Market Value on such future date.
(d)
Duration of
Options.
Each Option shall be exercisable at
such times and subject to such terms and conditions as the Board
may specify in the applicable option agreement; provided,
however, that no Option will be granted with a term in excess of
10 years.
(e)
Exercise of
Option.
Options may be exercised by delivery
to the Company or its designee of a written notice of exercise
signed by the proper person or by any other form of notice
(including electronic notice) approved by the Company, together
with payment in full as specified in Section 5(f) for the
number of shares for which the Option is exercised. Shares of
Common Stock subject to the Option will be delivered by the
Company as soon as practicable following exercise.
(f)
Payment Upon
Exercise.
Common Stock purchased upon the
exercise of an Option granted under the Plan shall be paid for
as follows:
(1) in cash or by check, payable to
the order of the Company;
(2) except as may otherwise be
provided in the applicable option agreement, by
(i) delivery of an irrevocable and unconditional
undertaking by a creditworthy broker to deliver promptly to the
Company sufficient funds to pay the exercise price and any
required tax withholding or (ii) delivery by the
Participant to the Company of a copy of irrevocable and
unconditional instructions to a creditworthy broker to deliver
promptly to the Company cash or a check sufficient to pay the
exercise price and any required tax withholding;
(3) to the extent provided for in
the applicable option agreement or approved by the Board, in its
sole discretion, by delivery (either by actual delivery or
attestation) of shares of Common Stock owned by the Participant
valued at their fair market value as determined by (or in a
manner approved by) the Board (Fair Market Value),
provided (i) such method of payment is then permitted under
applicable law, (ii) such Common Stock, if acquired
directly from the Company, was owned by the Participant for such
minimum period of time, if any, as may be established by the
Board in its discretion and (iii) such Common Stock is not
subject to any repurchase, forfeiture, unfulfilled vesting or
other similar requirements;
(4) to the extent permitted by
applicable law and provided for in the applicable option
agreement or approved by the Board, in its sole discretion, by
(i) delivery of a promissory note of the Participant to the
Company on terms determined by the Board, or (ii) payment
of such other lawful consideration as the Board may
determine; or
(5) by any combination of the above
permitted forms of payment.
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(g)
Limitation on
Repricing.
Unless such action is approved by
the Companys stockholders: (1) no outstanding Option
granted under the Plan may be amended to provide an exercise
price per share that is lower than the then-current exercise
price per share of such outstanding Option (other than
adjustments pursuant to Section 9) and (2) the
Board may not cancel any outstanding option (whether or not
granted under the Plan) and grant in substitution therefore new
Awards under the Plan covering the same or a different number of
shares of Common Stock and having an exercise price per share
lower than the then-current exercise price per share of the
cancelled option.
6.
Stock Appreciation
Rights.
(a)
General.
The
Board may grant Awards consisting of SARs entitling the holder,
upon exercise, to receive an amount of Common Stock or cash or a
combination thereof (such form to be determined by the Board)
determined in whole or in part by reference to appreciation,
from and after the date of grant, in the fair market value of a
share of Common Stock over the exercise price established
pursuant to Section 6(c). The date as of which such
appreciation is determined shall be the exercise date.
(b)
Grants.
SARs
may be granted in tandem with, or independently of, Options
granted under the Plan.
(1)
Tandem
Awards.
When SARs are expressly granted in
tandem with Options, (i) the SAR will be exercisable only
at such time or times, and to the extent, that the related
Option is exercisable (except to the extent designated by the
Board in connection with a Reorganization Event or a Change in
Control Event) and will be exercisable in accordance with the
procedure required for exercise of the related Option;
(ii) the SAR will terminate and no longer be exercisable
upon the termination or exercise of the related Option, except
to the extent designated by the Board in connection with a
Reorganization Event or a Change in Control Event and except
that a SAR granted with respect to less than the full number of
shares covered by an Option will not be reduced until the number
of shares as to which the related Option has been exercised or
has terminated exceeds the number of shares not covered by the
SAR; (iii) the Option will terminate and no longer be
exercisable upon the exercise of the related SAR; and
(iv) the SAR will be transferable only with the related
Option.
(2)
Independent
SARs.
A SAR not expressly granted in tandem
with an Option will become exercisable at such time or times,
and on such conditions, as the Board may specify in the SAR
Award.
(c)
Exercise
Price.
The Board shall establish the exercise
price of each SAR and specify it in the applicable SAR
agreement. The exercise price shall not be less than 100% of the
Fair Market Value on the date the SAR is granted; provided that
if the Board approves the grant of a SAR with an exercise price
to be determined on a future date, the exercise price shall be
not less than 100% of the Fair Market Value on such future date.
(d)
Duration of
SARs.
Each SAR shall be exercisable at such
times and subject to such terms and conditions as the Board may
specify in the applicable SAR agreement; provided, however, that
no SAR will be granted with a term in excess of 10 years.
(e)
Exercise of
SARs.
SARs may be exercised by delivery to
the Company or its designee of a written notice of exercise
signed by the proper person or by any other form of notice
(including electronic notice) approved by the Company, together
with any other documents required by the Company.
(f)
Limitation on
Repricing.
Unless such action is approved by
the Companys stockholders: (1) no outstanding SAR
granted under the Plan may be amended to provide an exercise
price per share that is lower than the then-current exercise
price per share of such outstanding SAR (other than adjustments
pursuant to Section 9) and (2) the Board may not
cancel any outstanding SAR (whether or not granted under the
Plan) and grant in substitution therefor new Awards under the
Plan covering the same or a different number of shares of Common
Stock and having an exercise price per share lower than the
then-current exercise price per share of the cancelled SAR.
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7.
Restricted Stock;
Restricted Stock Units.
(a)
General.
The
Board may grant Awards entitling recipients to acquire shares of
Common Stock (Restricted Stock), subject to the
right of the Company to repurchase all or part of such shares at
their issue price or other stated or formula price (or to
require forfeiture of such shares if issued at no cost) from the
recipient in the event that conditions specified by the Board in
the applicable Award are not satisfied prior to the end of the
applicable restriction period or periods established by the
Board for such Award. Instead of granting Awards for Restricted
Stock, the Board may grant Awards entitling the recipient to
receive shares of Common Stock or cash to be delivered at the
time such Award vests or such later time as may be specified in
such Award (Restricted Stock Units) (Restricted
Stock and Restricted Stock Units are each referred to herein as
a Restricted Stock Award).
(b)
Terms and Conditions for
All Restricted Stock Awards.
The Board shall
determine the terms and conditions of a Restricted Stock Award,
including the conditions for vesting and repurchase (or
forfeiture) and the issue price, if any. Restricted Stock Awards
that vest solely based on the passage of time shall be zero
percent vested prior to the first anniversary of the date of
grant, no more than one-third vested prior to the second
anniversary of the date of grant, and no more than two-thirds
vested prior to the third anniversary of the date of grant.
Restricted Stock Awards that do not vest solely based on the
passage of time shall not vest prior to the first anniversary of
the date of grant. The two foregoing sentences shall not apply
to (1) Performance Awards granted pursuant to
Section 10(i) or (2) Restricted Stock Awards and Other
Stock-Based Awards granted, in the aggregate, for up to
1,200,000 shares of Common Stock. Notwithstanding any other
provision of this Plan (other than Section 10(i), if
applicable), the Board may, in its discretion, either at the
time a Restricted Stock Award is made or at any time thereafter,
waive its right to repurchase shares of Common Stock (or waive
the forfeiture thereof) or remove or modify any part or all of
the restrictions applicable to the Restricted Stock Award,
provided that the Board may only exercise such rights in
extraordinary circumstances which shall include, without
limitation, death, disability, termination of employment
(including retirement) of the Participant; or a merger,
consolidation, sale, reorganization, recapitalization, or change
in control of the Company.
(c)
Additional Provisions
Relating to Restricted Stock.
(1)
Dividends.
Participants
holding shares of Restricted Stock will be entitled to all
ordinary cash dividends paid with respect to such shares, unless
otherwise provided by the Board. Unless otherwise provided by
the Board, if any dividends or distributions are paid in shares,
or consist of a dividend or distribution to holders of Common
Stock other than an ordinary cash dividend, the shares, cash or
other property will be subject to the same restrictions on
transferability and forfeitability as the shares of Restricted
Stock with respect to which they were paid. Each dividend
payment will be made no later than the end of the calendar year
in which the dividends are paid to shareholders of that class of
stock or, if later, the 15th day of the third month
following the date the dividends are paid to shareholders of
that class of stock.
(2)
Stock
Certificates.
The Company may require that
any stock certificates issued in respect of shares of Restricted
Stock shall be deposited in escrow by the Participant, together
with a stock power endorsed in blank, with the Company (or its
designee). At the expiration of the applicable restriction
periods, the Company (or such designee) shall deliver the
certificates no longer subject to such restrictions to the
Participant or if the Participant has died, to the beneficiary
designated, in a manner determined by the Company, by a
Participant to receive amounts due or exercise rights of the
Participant in the event of the Participants death (the
Designated Beneficiary). In the absence of an
effective designation by a Participant, Designated
Beneficiary shall mean the Participants estate.
(d)
Additional Provisions
Relating to Restricted Stock Units.
(1)
Settlement.
Upon
the vesting of
and/or
lapsing of any other restrictions (i.e., settlement) with
respect to each Restricted Stock Unit, the Participant shall be
entitled to receive from the Company one share of Common Stock
or an amount of cash equal to the Fair Market Value of one share
of Common Stock, as provided in the applicable Award agreement.
The Board may, in its discretion, provide that
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settlement of Restricted Stock Units shall be deferred, on a
mandatory basis or at the election of the Participant.
(2)
Voting
Rights.
A Participant shall have no voting
rights with respect to any Restricted Stock Units.
(3)
Dividend
Equivalents.
To the extent provided by the
Board, in its sole discretion, a grant of Restricted Stock Units
may provide Participants with the right to receive an amount
equal to any dividends or other distributions declared and paid
on an equal number of outstanding shares of Common Stock
(Dividend Equivalents). Dividend Equivalents may be
paid currently or credited to an account for the Participants,
may be settled in cash
and/or
shares of Common Stock and may be subject to the same
restrictions on transfer and forfeitability as the Restricted
Stock Units with respect to which paid, as determined by the
Board in its sole discretion, subject in each case to such terms
and conditions as the Board shall establish, in each case to be
set forth in the applicable Award agreement.
(e)
Deferred Delivery of
Shares.
The Board may, at the time any
Restricted Stock Award is granted, provide that, at the time
Common Stock would otherwise be delivered pursuant to the Award,
the Participant shall instead receive an instrument evidencing
the right to future delivery of Common Stock at such time or
times, and on such conditions, as the Board shall specify.
8.
Other Stock-Based
Awards.
(a)
General.
Other
Awards of shares of Common Stock, and other Awards that are
valued in whole or in part by reference to, or are otherwise
based on, shares of Common Stock or other property, may be
granted hereunder to Participants (Other
Stock-Based-Awards), including without limitation Awards
entitling recipients to receive shares of Common Stock to be
delivered in the future. Such Other Stock-Based Awards shall
also be available as a form of payment in the settlement of
other Awards granted under the Plan or as payment in lieu of
compensation to which a Participant is otherwise entitled. Other
Stock-Based Awards may be paid in shares of Common Stock or
cash, as the Board shall determine.
(b)
Terms and
Conditions.
Subject to the provisions of the
Plan, the Board shall determine the terms and conditions of each
Other Stock-Based Award, including any purchase price applicable
thereto. Other Stock-Based Awards that vest solely based on the
passage of time shall be zero percent vested prior to the first
anniversary of the date of grant, no more than one-third vested
prior to the second anniversary of the date of grant, and no
more than two-thirds vested prior to the third anniversary of
the date of grant. Other Stock-Based Awards that do not vest
solely based on the passage of time shall not vest prior to the
first anniversary of the date of grant. The two foregoing
sentences shall not apply to (1) Performance Awards granted
pursuant to Section 10(i) or (2) Restricted Stock
Awards and Other Stock-Based Awards granted, in the aggregate,
for up to 1,200,000 shares of Common Stock. Notwithstanding
any other provision of this Plan (other than Section 10(i),
if applicable), the Board may, in its discretion, either at the
time an Other Stock-Based Award is made or at any time
thereafter, waive its right to repurchase shares of Common Stock
(or waive the forfeiture thereof) or remove or modify any part
or all of the restrictions applicable to the Other Stock-Based
Award, provided that the Board may only exercise such rights in
extraordinary circumstances which shall include, without
limitation, death, disability, termination of employment
(including retirement) of the Participant; or a merger,
consolidation, sale, reorganization, recapitalization, or change
in control of the Company.
9.
Adjustments for Changes in
Common Stock and Certain Other Events.
(a)
Changes in
Capitalization.
In the event of any stock
split, reverse stock split, stock dividend, recapitalization,
combination of shares, reclassification of shares, spin-off or
other similar change in capitalization or event, or any dividend
or distribution to holders of Common Stock other than an
ordinary cash dividend, (i) the number and class of
securities available under this Plan, (ii) the sub-limits
and share counting rules set forth in Sections 4(a), 4(b),
7(b) and 8(b), (iii) the number and class of securities and
exercise price per share of each outstanding Option,
(iv) the share- and per-share provisions and the exercise
price of each SAR, (v) the number of shares subject to and
the repurchase price per share subject to each outstanding
Restricted Stock Award and (vi) the share- and
per-share-related provisions and the purchase price, if any, of
each outstanding Other Stock-Based Award, shall be equitably
adjusted by the Company (or substituted
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Awards may be made, if applicable) in the manner determined by
the Board. Without limiting the generality of the foregoing, in
the event the Company effects a split of the Common Stock by
means of a stock dividend and the exercise price of and the
number of shares subject to an outstanding Option are adjusted
as of the date of the distribution of the dividend (rather than
as of the record date for such dividend), then an optionee who
exercises an Option between the record date and the distribution
date for such stock dividend shall be entitled to receive, on
the distribution date, the stock dividend with respect to the
shares of Common Stock acquired upon such Option exercise,
notwithstanding the fact that such shares were not outstanding
as of the close of business on the record date for such stock
dividend.
(b)
Reorganization and Change
in Control Events
(1) Definitions
(A) A Reorganization
Event shall mean:
(i) any merger or consolidation of
the Company with or into another entity as a result of which all
of the Common Stock of the Company is converted into or
exchanged for the right to receive cash, securities or other
property or is cancelled;
(ii) any exchange of all of the
Common Stock of the Company for cash, securities or other
property pursuant to a share exchange transaction; or
(iii) any complete liquidation or
dissolution of the Company.
(B) A Change in Control
Event shall mean:
(i) the acquisition by an
individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
Person) of beneficial ownership of any capital stock
of the Company if, after such acquisition, such Person
beneficially owns (within the meaning of
Rule 13d-3
promulgated under the Exchange Act) 50% or more of either
(x) the then-outstanding shares of common stock of the
Company (the Outstanding Company Common Stock) or
(y) the combined voting power of the then-outstanding
securities of the Company entitled to vote generally in the
election of directors (the Outstanding Company Voting
Securities); provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute
a Change in Control Event: (A) any acquisition directly by
the Company, (B) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company, or (C) any
acquisition by any corporation pursuant to a Business
Combination (as defined below) which complies with
clauses (x) and (y) of subsection (iii) of this
definition; or
(ii) such time as the Continuing
Directors (as defined below) do not constitute a majority of the
Board (or, if applicable, the Board of Directors of a successor
corporation to the Company), where the term Continuing
Director means at any date a member of the Board
(x) who was a member of the Board on the date of the
initial adoption of this Plan by the Board or (y) who was
nominated or elected subsequent to such date by at least a
majority of the directors who were Continuing Directors at the
time of such nomination or election or whose election to the
Board was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such
nomination or election; provided, however, that there shall be
excluded from this clause (y) any individual whose initial
assumption of office occurred as a result of an actual or
threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation
of proxies or consents, by or on behalf of a person other than
the Board; or
(iii) the consummation of a merger,
consolidation, reorganization, recapitalization or share
exchange involving the Company or a sale or other disposition of
all or substantially all of the assets of the Company in one or
a series of transactions (a Business Combination),
unless, immediately following such Business Combination, each of
the following two conditions is satisfied: (x) all or
substantially all of the individuals and entities who were the
beneficial owners of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly,
more than 50% of the then-outstanding shares of common stock and
the combined
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voting power of the then-outstanding securities entitled to vote
generally in the election of directors, respectively, of the
resulting or acquiring corporation in such Business Combination
(which shall include, without limitation, a corporation which as
a result of such transaction owns the Company or substantially
all of the Companys assets either directly or through one
or more subsidiaries) (such resulting or acquiring corporation
is referred to herein as the Acquiring Corporation)
in substantially the same proportions as their ownership of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, respectively, immediately prior to such Business
Combination and (y) no Person (excluding any employee
benefit plan (or related trust) maintained or sponsored by the
Company or by the Acquiring Corporation) beneficially owns,
directly or indirectly, 50% or more of the then-outstanding
shares of common stock of the Acquiring Corporation, or of the
combined voting power of the then-outstanding securities of such
corporation entitled to vote generally in the election of
directors; or
(iv) the approval by the
stockholders of the Company of the complete liquidation or
dissolution of the Company.
(C) Cause shall have
the meaning set forth in the Participants employment or
other agreement with the Company, provided that if the
Participant is not a party to any such employment or other
agreement or such employment or other agreement does not contain
a definition of Cause, then Cause shall mean:
(i) the willful and continued
failure of the Participant to perform substantially the
Participants duties with the Company (other than any such
failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is
delivered to the Participant by the Company that specifically
identifies the alleged manner in which the Participant has not
substantially performed the Participants duties; or
(ii) the willful engaging by the
Participant in illegal conduct or gross misconduct that is
materially and demonstrably injurious to the Company.
For purposes of this definition, no act or failure to act on the
part of the Participant shall be considered willful
unless it is done, or omitted to be done, by the Participant in
bad faith or without reasonable belief that the
Participants action or omission was in the best interests
of the Company.
(D) Good Reason shall
have the meaning set forth in the Participants employment
or other agreement with the Company, provided that if the
Participant is not a party to any such employment or other
agreement or such employment or other agreement does not contain
a definition of Good Reason, then Good Reason shall mean the
occurrence, on or after a Change in Control Event and without
the affected Participants written consent, of:
(i) the assignment to the
Participant of duties in the aggregate that are inconsistent
with the Participants level of responsibility immediately
prior to the Change in Control Event (including without
limitation, in the case of a Participant who was, immediately
prior to the Change in Control Event, an executive officer of
the Company, such employee ceasing to be an executive officer of
the Company);
(ii) a reduction by the employer in
the Participants annual base salary, annual incentive
compensation opportunity, or long term incentive compensation
opportunity (including an adverse change in the performance
criteria or a decrease in the target amount of annual or long
term incentive compensation) from that in effect immediately
prior to the Change in Control Event; or
(iii) the relocation of the
Participants principal place of employment to a location
more than fifty (50) miles from the Participants
principal place of employment immediately prior to the Change in
Control Event, provided, however, such relocation also requires
a material change in the Participants commute.
(2)
Effect of Reorganization
Event on Options.
Upon the occurrence of a
Reorganization Event (regardless of whether such event also
constitutes a Change in Control Event), or the execution by the
Company of any agreement with respect to a Reorganization Event
(regardless of whether such event will
9
result in a Change in Control Event), the Board shall provide
that all outstanding Options shall be assumed, or equivalent
options shall be substituted, by the acquiring or succeeding
corporation (or an affiliate thereof). For purposes hereof, an
Option shall be considered to be assumed if, following
consummation of the Reorganization Event, the Option confers the
right to purchase, for each share of Common Stock subject to the
Option immediately prior to the consummation of the
Reorganization Event, the consideration (whether cash,
securities or other property) received as a result of the
Reorganization Event by holders of Common Stock for each share
of Common Stock held immediately prior to the consummation of
the Reorganization Event (and if holders were offered a choice
of consideration, the type of consideration chosen by the
holders of a majority of the outstanding shares of Common
Stock); provided, however, that if the consideration received as
a result of the Reorganization Event is not solely common stock
of the acquiring or succeeding corporation (or an affiliate
thereof), the Company may, with the consent of the acquiring or
succeeding corporation, provide for the consideration to be
received upon the exercise of Options to consist solely of
common stock of the acquiring or succeeding corporation (or an
affiliate thereof) equivalent in value (as determined by the
Board) to the per share consideration received by holders of
outstanding shares of Common Stock as a result of the
Reorganization Event.
Notwithstanding the foregoing, if the acquiring or succeeding
corporation (or an affiliate thereof) does not agree to assume,
or substitute for, such Options, or in the event of a
liquidation or dissolution of the Company, the Board may take
any one or more of the following actions as to all or any (or
any portion of) outstanding Options on such terms as the Board
determines: (i) upon written notice to a Participant,
provide that the Participants unexercised Options will
terminate immediately prior to the consummation of such
Reorganization Event unless exercised by the Participant within
a specified period following the date of such notice,
(ii) provide that outstanding Options shall become
exercisable, realizable, or deliverable, or restrictions
applicable to an Option shall lapse, in whole or in part prior
to or upon such Reorganization Event, (iii) in the event of
a Reorganization Event under the terms of which holders of
Common Stock will receive upon consummation thereof a cash
payment for each share surrendered in the Reorganization Event
(the Acquisition Price), make or provide for a cash
payment to a Participant equal to the excess, if any, of
(A) the Acquisition Price times the number of shares of
Common Stock subject to the Participants Options (if the
exercise price does not exceed the Acquisition Price) over
(B) the aggregate exercise price of all such outstanding
Options and any applicable tax withholdings, in exchange for the
termination of such Options, (iv) provide that, in
connection with a liquidation or dissolution of the Company,
Options shall convert into the right to receive liquidation
proceeds (if applicable, net of the exercise price thereof and
any applicable tax withholdings) and (v) any combination of
the foregoing. In taking any of the actions permitted under this
Section 9(b), the Board shall not be obligated by the Plan
to treat all Options, all Options held by a Participant, or all
Options of the same type, identically. In the event of a
Reorganization Event that does not also constitute a Change in
Control Event, then to the extent all or any portion of an
Option becomes exercisable solely as a result of the first
sentence of this paragraph, upon exercise of such Option the
Participant shall receive shares subject to a right of
repurchase by the Company or its successor at the Option
exercise price. Such repurchase right (i) shall lapse at
the same rate as the Option would have become exercisable under
its terms and (ii) shall not apply to any shares subject to
the Option that were exercisable under its terms without regard
to the first sentence of this paragraph.
(3)
Effect of Reorganization
Event on Restricted Stock Awards.
Upon the
occurrence of a Reorganization Event that is not a Change in
Control Event, the repurchase and other rights of the Company
under each outstanding Restricted Stock Award shall inure to the
benefit of the Companys successor and shall, unless the
Board determines otherwise, apply to the cash, securities or
other property which the Common Stock was converted into or
exchanged for pursuant to such Reorganization Event in the same
manner and to the same extent as they applied to the Common
Stock subject to such Restricted Stock Award.
(4)
Effect of Reorganization
Event on Stock Appreciation Rights and Other Stock Unit
Awards.
The Board may specify in an Award at
the time of the grant the effect of a Reorganization Event on
any SAR and Other Stock Unit Award.
(5)
Effect of Change in
Control Event on Awards.
10
(A) Unless otherwise determined by
the Board at the time of the grant or evidenced in an applicable
instrument evidencing an Award or employment or other agreement,
in the event that a Participants employment or service is
terminated by the Company without Cause or by the Participant
for Good Reason, in each case within eighteen (18) months
following a Change in Control Event:
(i) any Award carrying a right to
exercise that was not previously vested and exercisable shall
become fully vested and exercisable and all outstanding Awards
shall remain exercisable for one (1) year following such
date of termination of employment or service but in no event
beyond the original term of the Award and shall thereafter
terminate; and
(ii) the restrictions, deferral
limitations, payment conditions, and forfeiture conditions
applicable to any Award other than an Award described in
(i) shall lapse and such Awards shall be deemed fully
vested, and any performance conditions imposed with respect to
Awards shall be deemed to be achieved at the higher of
(x) the target level for the applicable performance period
or (y) the level of achievement of such performance
conditions for the most recently concluded performance period.
(B) Notwithstanding subparagraph
(A) of this Section 9(b)(5), upon a Change in Control
Event, the Board shall have the discretion to:
(i) accelerate the vesting or
payment of any Award effective immediately upon the occurrence
of a Change in Control Event; or
(ii) convert the vesting of
performance-based Awards to a time-based vesting schedule as
deemed appropriate by the Board;
in each case only to the extent that such action would not cause
any Award to result in deferred compensation that is subject to
the additional twenty percent (20%) tax under Section 409A
of the Code.
(6)
Adjustment for Excise
Tax.
The Board may, in its sole discretion,
provide in an instrument evidencing an Award or otherwise for
specific treatment of any outstanding Award in the event that
any payment or benefit under this Plan would be subject to the
excise tax imposed by Section 4999 of the Code (the
Excise Tax) or any interest or penalties with
respect to such Excise Tax. Such treatment may include the
payment by the Company of a
gross-up
payment in an amount equal to such Excise Tax, interest and
penalties or the imposition of a cutback in payments or benefits.
10.
General Provisions
Applicable to Awards
(a)
Transferability of
Awards.
Awards shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to
whom they are granted, either voluntarily or by operation of
law, except by will or the laws of descent and distribution or,
other than in the case of an Incentive Stock Option, pursuant to
a qualified domestic relations order, and, during the life of
the Participant, shall be exercisable only by the Participant;
provided, however, that the Board may permit or provide in an
Award for the gratuitous transfer of the Award by the
Participant to or for the benefit of any immediate family
member, family trust or other entity established for the benefit
of the Participant
and/or
an
immediate family member thereof if, with respect to such
proposed transferee, the Company would be eligible to use a
Form S-8
for the registration of the sale of the Common Stock subject to
such Award under the Securities Act of 1933, as amended;
provided, further, that the Company shall not be required to
recognize any such transfer until such time as the Participant
and such permitted transferee shall, as a condition to such
transfer, deliver to the Company a written instrument in form
and substance satisfactory to the Company confirming that such
transferee shall be bound by all of the terms and conditions of
the Award. References to a Participant, to the extent relevant
in the context, shall include references to authorized
transferees.
(b)
Documentation.
Each
Award shall be evidenced on such form, and containing such terms
and conditions, as the Board shall determine and shall be
delivered in such manner as the Company shall determine,
including in writing, electronically or otherwise. The Award may
be in the form of an agreement signed by the Company and the
Participant or a written or electronic confirming memorandum to
the Participant from the Company. Each Award may contain terms
and conditions in addition to those set forth in the Plan.
11
(c)
Board
Discretion.
Except as otherwise provided by
the Plan, each Award may be made alone or in addition or in
relation to any other Award. The terms of each Award need not be
identical, and the Board need not treat Participants uniformly.
(d)
Termination of
Status.
The Board shall determine the effect
on an Award of the disability, death, termination or other
cessation of employment, authorized leave of absence or other
change in the employment or other status of a Participant and
the extent to which, and the period during which, the
Participant, or the Participants legal representative,
conservator, guardian or Designated Beneficiary, may exercise
rights under the Award.
(e)
Withholding.
The
Participant must satisfy all applicable federal, state, and
local or other income and employment tax withholding obligations
before the Company will deliver stock certificates or otherwise
recognize ownership of Common Stock under an Award. The Company
may decide to satisfy the withholding obligations through
additional withholding on salary or wages. If the Company elects
not to or cannot withhold from other compensation, the
Participant must pay the Company the full amount, if any,
required for withholding or have a broker tender to the Company
cash equal to the withholding obligations. Payment of
withholding obligations is due before the Company will issue any
shares on exercise or release from forfeiture of an Award or, if
the Company so requires, at the same time as is payment of the
exercise price unless the Company determines otherwise. If
provided for in an Award or approved by the Company in its sole
discretion, a Participant may satisfy such tax obligations in
whole or in part by delivery of shares of Common Stock,
including shares retained from the Award creating the tax
obligation, valued at their Fair Market Value; provided,
however, except as otherwise provided by the Company, that the
total tax withholding where stock is being used to satisfy such
tax obligations cannot exceed the Companys minimum
statutory withholding obligations (based on minimum statutory
withholding rates for federal and state tax purposes, including
payroll taxes, that are applicable to such supplemental taxable
income). Shares surrendered to satisfy tax withholding
requirements cannot be subject to any repurchase, forfeiture,
unfulfilled vesting or other similar requirements.
(f)
Amendment of
Award.
Except as otherwise provided in
Section 5(g) with respect to repricings, Section 7(b)
or 8(b) with respect to the vesting of Restricted Stock Awards
and Other Stock-Based Awards, Section 10(i) with respect to
Performance Awards or Section 11(d) with respect to actions
requiring shareholder approval, the Board may amend, modify or
terminate any outstanding Award, including but not limited to,
substituting therefor another Award of the same or a different
type, changing the date of exercise or realization, and
converting an Incentive Stock Option to a Nonstatutory Stock
Option. The Participants consent to such action shall be
required unless (i) the Board determines that the action,
taking into account any related action, would not materially and
adversely affect the Participants rights under the Plan or
(ii) the change is permitted under Section 9 hereof.
(g)
Conditions on Delivery of
Stock.
The Company will not be obligated to
deliver any shares of Common Stock pursuant to the Plan or to
remove restrictions from shares previously delivered under the
Plan until (i) all conditions of the Award have been met or
removed to the satisfaction of the Company, (ii) in the
opinion of the Companys counsel, all other legal matters
in connection with the issuance and delivery of such shares have
been satisfied, including any applicable securities laws and any
applicable stock exchange or stock market rules and regulations,
and (iii) the Participant has executed and delivered to the
Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any
applicable laws, rules or regulations.
(h)
Acceleration.
Except
as otherwise provided in Sections 7(b) or 8(b), the Board
may at any time provide that any Award shall become immediately
exercisable in full or in part, free of some or all restrictions
or conditions, or otherwise realizable in full or in part, as
the case may be.
(i)
Performance
Awards.
(1)
Grants.
Restricted
Stock Awards and Other Stock-Based Awards under the Plan may be
made subject to the achievement of performance goals pursuant to
this Section 10(i) (Performance Awards),
subject to the limit in Section 4(b)(1) on shares covered
by such grants.
12
(2)
Committee.
Grants
of Performance Awards to any Covered Employee intended to
qualify as performance-based compensation under
Section 162(m) (Performance-Based Compensation)
shall be made only by a Committee (or subcommittee of a
Committee) comprised solely of two or more directors eligible to
serve on a committee making Awards qualifying as
performance-based compensation under
Section 162(m). In the case of such Awards granted to
Covered Employees, references to the Board or to a Committee
shall be deemed to be references to such Committee or
subcommittee. Covered Employee shall mean any person
who is, or whom the Committee, in its discretion, determines may
be, a covered employee under Section 162(m)(3)
of the Code.
(3)
Performance
Measures.
For any Award that is intended to
qualify as Performance-Based Compensation, the Committee shall
specify that the extent of vesting
and/or
delivery shall be subject to the achievement of one or more
objective performance measures established by the Committee,
which shall be based on the relative or absolute attainment of
specified levels of one or any combination of the following:
(a) earnings per share, (b) return on average equity
or average assets in relation to a peer group of companies
designated by the Company, (c) earnings, (d) earnings
growth, (e) earnings before interest, taxes and
amortization (EBITA), (f) operating income,
(g) operating margins, (h) revenues,
(i) expenses, (j) stock price, (k) market share,
(l) chargeoffs, (m) reductions in non-performing
assets, (n) return on sales, assets, equity or investment,
(o) regulatory compliance, (p) satisfactory internal
or external audits, (q) improvement of financial ratings,
(r) achievement of balance sheet or income statement
objectives, (s) net cash provided from continuing
operations, (t) stock price appreciation, (u) total
shareholder return, (v) cost control, (w) strategic
initiatives, (x) net operating profit after tax,
(y) pre-tax or after-tax income, (z) cash flow, or
(aa) such other objective goals established by the Committee,
and may be absolute in their terms or measured against or in
relationship to other companies comparably, similarly or
otherwise situated. The Committee may specify that such
performance measures shall be adjusted to exclude any one or
more of (i) extraordinary items and any other unusual or
non-recurring items, (ii) discontinued operations,
(iii) gains or losses on the dispositions of discontinued
operations, (iv) the cumulative effects of changes in
accounting principles, (v) the writedown of any asset, and
(vi) charges for restructuring and rationalization
programs. Such performance measures: (i) may vary by
Participant and may be different for different Awards;
(ii) may be particular to a Participant or the department,
branch, line of business, subsidiary or other unit in which the
Participant works and may cover such period as may be specified
by the Committee; and (iii) shall be set by the Committee
within the time period prescribed by, and shall otherwise comply
with the requirements of, Section 162(m). Awards that are
not intended to qualify as Performance-Based Compensation may be
based on these or such other performance measures as the Board
may determine.
(4)
Adjustments.
Notwithstanding
any provision of the Plan, with respect to any Performance Award
that is intended to qualify as Performance-Based Compensation,
the Committee may adjust downwards, but not upwards, the cash or
number of Shares payable pursuant to such Award, and the
Committee may not waive the achievement of the applicable
performance measures except in the case of the death or
disability of the Participant or a change in control of the
Company.
(5)
Other.
The
Committee shall have the power to impose such other restrictions
on Performance Awards as it may deem necessary or appropriate to
ensure that such Awards satisfy all requirements for
Performance-Based Compensation.
11.
Miscellaneous
(a)
No Right To Employment or
Other Status.
No person shall have any claim
or right to be granted an Award, and the grant of an Award shall
not be construed as giving a Participant the right to continued
employment or any other relationship with the Company. The
Company expressly reserves the right at any time to dismiss or
otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly
provided in the applicable Award.
(b)
No Rights As
Stockholder.
Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall
have any rights as a stockholder with respect to any shares of
Common Stock to be distributed with respect to an Award until
becoming the record holder of such shares.
13
(c)
Effective Date and Term
of Plan.
The Plan shall become effective on
the date the Plan is approved by the Companys stockholders
(the Effective Date). No Awards shall be granted
under the Plan after the expiration of 10 years from the
Effective Date, but Awards previously granted may extend beyond
that date.
(d)
Amendment of
Plan.
The Board may amend, suspend or
terminate the Plan or any portion thereof at any time provided
that (i) to the extent required by Section 162(m), no
Award granted to a Participant that is intended to comply with
Section 162(m) after the date of such amendment shall
become exercisable, realizable or vested, as applicable to such
Award, unless and until such amendment shall have been approved
by the Companys stockholders if required by
Section 162(m) (including the vote required under
Section 162(m)); (ii) no amendment that would require
stockholder approval under the rules of the New York Stock
Exchange (NYSE) may be made effective unless and
until such amendment shall have been approved by the
Companys stockholders; and (iii) if the NYSE amends
its corporate governance rules so that such rules no longer
require stockholder approval of material revisions to equity
compensation plans, then, from and after the effective date of
such amendment to the NYSE rules, no amendment to the Plan
(A) materially increasing the number of shares authorized
under the Plan (other than pursuant to Section 4(c) or 9),
(B) expanding the types of Awards that may be granted under
the Plan, or (C) materially expanding the class of
participants eligible to participate in the Plan shall be
effective unless stockholder approval is obtained. In addition,
if at any time the approval of the Companys stockholders
is required as to any other modification or amendment under
Section 422 of the Code or any successor provision with
respect to Incentive Stock Options, the Board may not effect
such modification or amendment without such approval. Unless
otherwise specified in the amendment, any amendment to the Plan
adopted in accordance with this Section 11(d) shall apply
to, and be binding on the holders of, all Awards outstanding
under the Plan at the time the amendment is adopted, provided
the Board determines that such amendment does not materially and
adversely affect the rights of Participants under the Plan.
(e)
Provisions for Foreign
Participants.
The Board may modify Awards
granted to Participants who are foreign nationals or employed
outside the United States or establish subplans or procedures
under the Plan to recognize differences in laws, rules,
regulations or customs of such foreign jurisdictions with
respect to tax, securities, currency, employee benefit or other
matters.
(f)
Compliance with Code
Section 409A.
No Award shall provide for
deferral of compensation that does not comply with
Section 409A of the Code, unless the Board, at the time of
grant, specifically provides that the Award is not intended to
comply with Section 409A of the Code. The Company shall
have no liability to a Participant, or any other party, if an
Award that is intended to be exempt from, or compliant with,
Section 409A is not so exempt or compliant or for any
action taken by the Board.
(g)
Governing
Law.
The provisions of the Plan and all
Awards made hereunder shall be governed by and interpreted in
accordance with the laws of the State of Delaware, excluding
choice-of-law principles of the law of such state that would
require the application of the laws of a jurisdiction other than
such state.
Exhibit
10.2
THERMO
FISHER SCIENTIFIC INC.
2008
ANNUAL INCENTIVE AWARD PLAN
I. General Purpose of Plan
The Thermo Fisher Scientific Inc. 2008
Annual Incentive Award Plan is designed to assist the
Corporation and its Subsidiaries in attracting, retaining and
providing incentives to Eligible Employees and to promote the
identification of their interests with those of the
Corporations shareholders by providing for the payment of
Incentive Awards subject to the achievement of specified
Performance Goals.
II. Definitions
Terms not otherwise defined herein shall
have the following meanings:
A. Award
Period means the calendar year, except to the extent the
Committee determines otherwise.
B. Board
means the Board of Directors of the Corporation.
C. Code
means the Internal Revenue Code of 1986, as amended.
D. Committee
means the Compensation Committee of the Board, or any other
committee appointed by the Board to administer the Plan.
E. Corporation
means Thermo Fisher Scientific Inc., a Delaware corporation, and
its successors and assigns and any corporation which shall
acquire substantially all of its assets.
F. Covered
Employee means a covered employee within the
meaning of Section 162(m) of the Code.
G. Eligible
Employee means an employee described in Section IV
hereof.
H. Incentive
Award means a contingent award made to a Participant that,
subject to Section V hereof, entitles the Participant to
cash payment to reflect the relative level of attainment of
Performance Goals established by the Committee for an Award
Period and such other factors as the Committee may determine.
I. Participant
means any Eligible Employee who receives an Incentive Award
under the Plan for an Award Period.
J. Performance
Goals means (a) earnings per share, (b) return
on average equity in relation to a peer group of companies
designated by the Corporation (the Peer Group),
(c) return on average assets in relation to the Peer Group,
or (d) such other performance goals as may be established
by the Committee which may be based on earnings, earnings
growth, earnings before interest, taxes, and amortization
(EBITA), operating income, operating margins, revenues,
expenses, stock price, market share, charge-offs, reductions in
non-performing assets, return on assets, equity or investment,
regulatory compliance, satisfactory internal or external audits,
improvement of financial ratings, achievement of balance sheet
or income statement objectives, net cash provided from
continuing operations, stock price appreciation, total
shareholder return, cost control, strategic initiatives, market
share, pre- or after-tax income, or any other objective goals
established by the Committee, and may be absolute in their terms
or measured against or in relationship to other companies
comparably, similarly or otherwise situated. Such performance
goals may be particular to a Participant or the division,
department, branch, line of business, Subsidiary or other unit
in which the Participant works, or may be based on the
performance of the Corporation generally, and may cover such
period as may be specified by the Committee. The Committee may
specify that such Performance Goals shall be applied by
excluding the impact of restructurings, discontinued operations,
extraordinary items, cost of revenues charges associated with
acquisitions or restructurings, other unusual or non-recurring
items, and the cumulative effects of accounting changes.
K. Plan
means the Thermo Fisher Scientific Inc. 2008 Annual Incentive
Award Plan.
2
L. Subsidiary
means a corporation of which at least 50% of the total combined
voting power of all classes of stock is owned by the
Corporation, either directly or through one or more other
Subsidiaries.
III. Administration
The Plan shall be administered by the
Committee. The Committee shall have plenary authority, in its
discretion, to determine the terms of all Incentive Awards,
including, without limitation, the Eligible Employees to whom,
and the time or times at which, Incentive Awards are made, the
Award Period to which each Incentive Award shall relate, the
actual dollar amount to be paid pursuant to an Incentive Award,
the Performance Goals to which payment of Incentive Awards will
be subject, and when payments pursuant to Incentive Awards shall
be made (which payments may, without limitation, be made during
or after an Award Period on a deferred basis or in
installments). In making such determinations, the Committee may
take into account the nature of the services rendered by the
respective Eligible Employees, their present and potential
contributions to the success of the Corporation and its
Subsidiaries, and such other factors as the Committee in its
discretion shall deem relevant. Subject to the express
provisions of the Plan, the Committee shall have plenary
authority to interpret the Plan, to prescribe, amend and rescind
rules and regulations relating to it and to make all other
determinations deemed necessary or advisable for the
administration of the Plan. The determinations of the Committee
pursuant to its authority under the Plan shall be conclusive and
binding.
IV. Eligibility
Incentive Awards may be granted only to
executive officers of the Corporation or a Subsidiary.
V. Incentive Awards; Terms of
Awards; Payment
A. The
Committee shall, in its sole discretion, determine which
Eligible Employees shall receive Incentive Awards. For each
Award Period with respect to which the Committee determines to
make Incentive Awards, the Committee shall by resolution
establish one or more Performance Goals applicable to such
Incentive Awards and the other terms and conditions of the
Incentive Awards. Such Performance Goals and other terms and
conditions shall be established by the Committee in its sole
discretion as it shall deem appropriate and in the best
interests of the Corporation and shall be established
(1) within 90 days after the first day of the Award
Period and (2) before 25% of the Award Period has elapsed.
B. After
the end of each Award Period for which the Committee has granted
Incentive Awards, the Committee shall determine the extent to
which the Performance Goals established by the Committee for the
Award Period have been achieved and shall authorize the
Corporation to make Incentive Award payments to Participants in
accordance with the terms of the Incentive Awards. In no event
shall the amount paid to a Participant in accordance with the
terms of an Incentive Award by reason of Performance Goal
achievement exceed $5,000,000 in any calendar year. Unless
otherwise determined by the Committee, no Incentive Award
payments shall be made to a Participant unless the Participant
is employed by the Corporation or a Subsidiary as of the end of
the Award Period.
C. The
Committee may at any time, in its sole discretion, cancel an
Incentive Award or eliminate or reduce (but not increase) the
amount payable pursuant to the terms of an Incentive Award
without the consent of a Participant.
D. Incentive
Award payments shall be subject to applicable federal, state and
local withholding taxes and other applicable withholding in
accordance with the Corporations payroll practices as from
time-to-time in effect.
E. The
Committee shall have the power to impose such other restrictions
on Incentive Awards as it may deem necessary or appropriate to
ensure that such Incentive Awards satisfy all requirements for
performance-based compensation within the meaning of
Section 162(m)(4)(C) of the Code, or any successor
provision thereto.
VI. Transferability
Incentive Awards shall not be subject to
the claims of creditors and may not be assigned, alienated,
transferred or encumbered in any way other than by will or
pursuant to the laws of descent and distribution.
3
VII. Termination or Amendment
The Committee may amend, modify or
terminate the Plan in any respect at any time without the
consent of Participants, provided that (a) no amendment or
termination of the Plan after the end of an Award Period may
adversely affect the rights of Participants with respect to
their Incentive Awards for that Award Period, and (b) no
amendment which would require shareholder approval under
Section 162(m) of the Code may be effected without such
shareholder approval.
VIII. Effectiveness of Plan and
Awards
The Plan and Incentive Awards granted
hereunder shall be void ab initio unless the Plan is approved by
a vote of the Corporations shareholders at the first
shareholders meeting of the Corporation following adoption
of the Plan by the Committee.
IX. Effective Date; Term of the Plan
The Plan shall be effective as of
January 1, 2008. Unless sooner terminated by the
Committee pursuant to Section 7, to the extent necessary to
ensure that Incentive Award payments made to Covered Employees
may be deductible for federal income tax purposes, the Plan
shall terminate as of the date of the first meeting of the
Corporations shareholders occurring during 2013, unless
the term of the Plan is extended and reapproved at such
shareholders meeting. No Incentive Awards may be awarded
under the Plan after its termination. Termination of the Plan
shall not affect any Incentive Awards outstanding on the date of
termination and such awards shall continue to be subject to the
terms of the Plan notwithstanding its termination.
X. General Provisions
A. The
establishment of the Plan shall not confer upon any Eligible
Employee any legal or equitable right against the Corporation or
any Subsidiary, except as expressly provided in the Plan.
B. The Plan
does not constitute an inducement or consideration for the
employment of any Eligible Employee, nor is it a contract
between the Corporation, or any Subsidiary and any Eligible
Employee. Participation in the Plan shall not give an Eligible
Employee any right to be retained in the employ of the
Corporation or any Subsidiary.
C. Nothing
contained in this Plan shall prevent the Committee from adopting
other or additional compensation arrangements, subject to
shareholder approval if such approval is required, and such
arrangements may be either generally applicable or applicable
only in specific cases.
D. The Plan
shall be governed, construed and administered in accordance with
the laws of the State of Delaware.