{"id":38436,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/2001-stock-incentive-plan-kb-home.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"2001-stock-incentive-plan-kb-home","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/2001-stock-incentive-plan-kb-home.html","title":{"rendered":"2001 Stock Incentive Plan &#8211; KB Home"},"content":{"rendered":"<pre>                                    KB HOME\n\n                            2001 STOCK INCENTIVE PLAN\n\n        SECTION 1. PURPOSE. The purpose of the 2001 Stock Incentive Plan (the\n\"Plan\") is to promote the success of KB HOME (the \"Company\") by providing a\nmethod whereby employees of the Company and its subsidiaries and other eligible\nparticipants may be encouraged to invest in the Common Stock, $1.00 par value,\nof the Company (\"Common Stock\"), increase their proprietary interest in its\nbusiness, remain in the employ of the Company or its subsidiaries, and increase\ntheir personal interests in the continued success and progress of the Company.\nThe Plan provides for the grant of Options that satisfy the requirements for\ntreatment as Incentive Stock Options (\"ISOs\") as defined under Section 422 of\nthe Code or that are not intended to satisfy such requirements (\"Non-qualified\nOptions\"), as well as for certain other \"Awards,\" as defined below.\n\n        SECTION 2. DEFINITIONS. As used in this Plan, the following terms shall\nhave the indicated meanings:\n\n        (a) Award: An award under this Plan of a Performance Stock Award,\nRestricted Stock Award, or Stock Unit Award.\n\n        (b) Board: The board of directors of KB HOME.\n\n        (c) Code: The Internal Revenue Code of 1986, as amended.\n\n        (d) Committee: The Committee specified in Section 3(a) of this Plan.\n\n        (e) Company: KB HOME and its Subsidiaries.\n\n        (f) Exchange Act: The Securities Exchange Act of 1934, as amended.\n\n        (g) Limited Stock Appreciation Right: A right granted pursuant to\nSection 6(b) to receive cash in certain circumstances with respect to a related\nOption.\n\n        (h) Option: An Option is a right granted under Section 6(a) to purchase\na number of shares of Common Stock at such exercise price, at such times, and on\nsuch other terms and conditions as are specified in or determined pursuant to\nthe document(s) evidencing the Award.\n\n        (i) Participant: An individual eligible under Section 5(a) to\nparticipate in this Plan.\n\n\n                                       1\n\n\n\n        (j) Performance Objectives: With reference to a particular Option or\nAward, the objectives established by the Committee under various criteria, the\nsatisfaction of which may result in the grant, issuance, retention and\/or\nvesting of an Option, a Performance Stock Award or Stock Unit Award, or which\nmay accelerate the release of shares of Common Stock from the restrictions of a\nRestricted Stock Award. The Performance Objectives may differ from Participant\nto Participant and from Award to Award, as determined by the Committee and\nspecified in the applicable Award. For purposes of an Award that is intended to\nqualify as \"performance-based compensation\" under Code Section 162(m), the term\n\"Performance Objective\" shall mean any one or more of the following performance\ncriteria, either individually, alternatively or in any combination, applied to\neither the Company as a whole or to a business unit or subsidiary, either\nindividually, alternatively or in any combination, and measured either annually\nor cumulatively over a period of years, on an absolute basis or relative to a\npre-established target, to previous years' results or to a designated comparison\ngroup, in each case as specified by the Committee in the Award: (i) pre-tax\nincome, (ii) after-tax income, (iii) cash flow, (iv) return on equity, (v)\nreturn on capital, (vi) earnings per share (including earnings before interest,\ntaxes, depreciation and amortization), (vii) unit volume, (viii) net sales, (ix)\nservice quality or (v) total shareholder return, in each case as determined in\naccordance with Generally Accepted Accounting Principles, if applicable.\n\n        (k) Performance Stock Award: Performance Stock is an award of shares of\nCommon Stock made under Section 7(a), the grant, issuance, retention and\/or\nvesting of which is subject to such performance and other conditions as are\nexpressed in the document(s) evidencing the Award.\n\n        (l) Plan: The KB HOME 2001 Stock Incentive Plan, as it may be amended\nfrom time to time.\n\n        (m) Restricted Stock Award: Restricted Stock is a right granted under\nSection 7(b) to shares of Common Stock issued or issuable under the Plan but\nsubject during specified periods of time to such conditions on vesting,\nrestrictions on transferability and\/or repurchase rights as are expressed in the\ndocument(s) evidencing the Award.\n\n        (n) Stock Unit Award: An award granted under Section 8 of this Plan.\n\n        (o) Subsidiary: Any corporation of which the Corporation owns, directly\nor indirectly, fifty percent (50%) or more of the voting or capital stock, or\nany partnership or other entity of which the Company owns, directly or\nindirectly, a fifty percent (50%) or more participating interest or the general\npartner of which is a Subsidiary.\n\n        (p) Tax Date: The date on which taxes of any kind are required by law to\nbe withheld with respect to shares of Common Stock subject to an Option or\nAward.\n\n\n                                       2\n\n\n\n        SECTION 3. ADMINISTRATION.\n\n        (a) The Plan shall be administered by the Board and\/or by a committee of\nthe Board, as appointed from time to time by the Board (the \"Committee\"). The\nBoard shall fill vacancies on, and from time to time may remove or add members\nto, the Committee. The Committee shall act pursuant to a majority vote or\nunanimous written consent. Notwithstanding the foregoing, with respect to any\nAward that is not intended to satisfy the conditions of Rule 16b-3 under the\nExchange Act or Section 162(m)(4)(C) of the Code, the Committee may appoint one\nor more separate committees (any such committee, a \"Subcommittee\") composed of\none or more directors of the Corporation (who may but need not be members of the\nCommittee) and may delegate to any such Subcommittee(s) the authority to grant\nOptions, Limited Stock Appreciation Rights and\/or Awards under the Plan, to\ndetermine all terms of such Options, Limited Stock Appreciation Rights and\/or\nAwards, and to administer the Plan or any aspect of it. Any action by any such\nSubcommittee shall be deemed for all purposes to have been taken by the\nCommittee. The Committee may designate the Secretary of the Corporation or other\nCompany employees to assist the Committee in the administration of the Plan, and\nmay grant authority to such persons to issue and\/or execute agreements or other\ndocuments under this Plan on behalf of the Committee or the Company.\n\n        (b) The Committee shall have full power and authority, subject to such\norders or resolutions not inconsistent with the provisions of the Plan as may\nfrom time to time be issued or adopted by the Board, to grant to eligible\npersons Options, Limited Stock Appreciation Rights and Awards pursuant to the\nprovisions of the Plan, to fix the exercise price and other terms of Options, to\nfix the terms of any Performance Stock Award and\/or Restricted Stock Award in a\nmanner consistent with the terms of Section 7, to fix the terms of any Stock\nUnit Award in a manner consistent with the terms of Section 8, to prescribe,\namend and rescind rules and regulations, if any, relating to the Plan, to\ninterpret the provisions of the Plan, Options, Limited Stock Appreciation Rights\nand Awards issued under the Plan, to amend such Options, Limited Stock\nAppreciation Rights and Awards from time to time subject to the provisions of\nthe Plan, and to supervise the administration of the Plan. All decisions made by\nthe Committee pursuant to the provisions of the Plan and related orders or\nresolutions of the Board shall be final, conclusive and binding on all persons,\nincluding the Company, stockholders, employees and optionees.\n\n        (c) Each person who is or shall have been a member of the Committee or\nof the Board shall be indemnified and held harmless by the Company from any\nloss, cost, liability or expense that may be imposed upon or reasonably incurred\nby him or her in connection with any claim, action, suit or proceeding to which\nhe or she may be a party by reason of any action taken or any failure to act\nunder the Plan. The foregoing right of indemnification shall not be exclusive of\nany other rights of indemnification to which\n\n\n                                       3\n\n\nsuch persons may be entitled under the Company's Articles of Incorporation or\nBylaws, or as a matter of law, or otherwise, or any power that the Company may\nhave to indemnify them or hold them harmless.\n\n        SECTION 4. SHARES SUBJECT TO THE PLAN.\n\n        (a) The shares to be delivered upon exercise of Options or Limited Stock\nAppreciation Rights granted under the Plan or pursuant to Awards, may be made\navailable from the authorized but unissued shares of the Company or from shares\nreacquired by the Company, including shares purchased in the open market or in\nprivate transactions.\n\n        (b) Subject to adjustments made pursuant to the provisions of Section\n4(d) and this Section 4(b), the aggregate number of shares reserved for issuance\nupon the exercise of Options and pursuant to Awards which may be granted under\nthe Plan shall not exceed 4,200,000 shares of Common Stock. The aggregate number\nof shares of Common Stock issued under this Plan shall equal only the number of\nshares actually issued upon exercise or settlement of an Option or vesting or\nsettlement of any Award and not returned to the Company upon cancellation,\nexpiration or forfeiture of Options and Awards or delivered (either actually or\nby attestation) in payment or satisfaction of the exercise price, purchase price\nor tax obligation of Options and Awards.\n\n        (c) The aggregate number of shares of Common Stock issued and issuable\npursuant to ISOs may not exceed 4,200,000 shares. The maximum number of shares\nof Common Stock subject to Options granted during any calendar year to any one\nParticipant shall not exceed 1,000,000. The maximum number of shares of Common\nStock subject to Awards (other than Stock Units issued or issuable upon exercise\nof Options) that may be granted during any calendar year to any one Participant\nshall not exceed 500,000 in the aggregate.\n\n        (d) In the event that the Committee shall determine that any stock\ndividend, extraordinary cash dividend, recapitalization, reorganization, merger,\nconsolidation, split-up, spin-off, combination, exchange of shares, warrants or\nrights offering to purchase Common Stock at a price substantially below fair\nmarket value, or other similar corporate event affects the Common Stock such\nthat an adjustment is required in order to preserve the benefits or potential\nbenefits intended to be made available to Participants under this Plan, then the\nCommittee may, in its sole discretion and in such manner as the Committee may\ndeem equitable, adjust any or all of (1) the number and kind of shares which\nthereafter may be awarded or optioned and sold or made the subject of Limited\nStock Appreciation Rights under the Plan, (2) the number and kind of shares\nsubject to outstanding Options and Awards, and Limited Stock Appreciation\nRights, and (3) the option price with respect to any of the foregoing and\/or, if\ndeemed \n\n\n                                       4\n\n\nappropriate, make provision for a cash payment to a Participant, including to\nreflect such an event occurring prior to an Option or Award, the grant of which\nwas intentionally deferred in anticipation of such event; provided, however,\nthat the number of shares subject to any Option or Award shall always be a whole\nnumber.\n\n        SECTION 5. ELIGIBILITY AND EXTENT OF PARTICIPATION.\n\n        (a) The persons eligible to receive Awards, Options and associated\nLimited Stock Appreciation Rights under the Plan shall consist of employees or\nprospective employees of the Company and consultants or advisors of the Company\nwho, in the Committee's judgment, can make substantial contributions to the\nCompany's long-term profitability and value. For purposes of the administration\nof previously granted Options and Awards, the term \"Participant\" shall also\ninclude a former Participant and any permitted transferee (including any trust,\npartnership or estate) of a Participant or former Participant.\n\n        (b) Subject to the limitations of the Plan, the Committee shall, after\nsuch consultation with and consideration of the recommendations of management as\nthe Committee considers desirable, select from eligible persons those\nParticipants to be granted Options and Awards and determine the time when each\nOption and Award shall be granted, the number of shares subject to each Option\nand Award and whether Limited Stock Appreciation Rights should be granted in\nconnection with such Option, the number of shares for each Award and the\nrestrictions associated with such Award. Subject to the provisions of Section 4,\nboth Options and Awards may be granted to the same Participant.\n\n        SECTION 6. GRANTS OF OPTIONS AND LIMITED STOCK APPRECIATION RIGHTS.\n\n        (a) Grant of Options. Options on shares of Common Stock may be granted\nto Participants by the Committee from time to time at its sole discretion.\nOptions intended to qualify as ISOs pursuant to Code Section 422 and\nNon-Qualified Options which are not intended to qualify as ISOs may be granted\nas the Committee in its sole discretion shall determine. Each Option grant shall\ncontain such terms and conditions as may be approved by the Committee. Subject\nto the terms of the Plan, the Committee may establish provisions regarding (1)\nthe number of shares of Common Stock which may be issued upon exercise of the\nOption, (2) the purchase price of the shares of Common Stock and the means of\npayment for the shares of Common Stock, (3) the term of the Option, (4) such\nterms and conditions of exercisability as may be determined from time to time by\nthe Committee, (5) restrictions on the transfer of the Option and forfeiture\nprovisions, and (6) such further terms and conditions, in each case not\ninconsistent with the Plan as may be determined from time to time by the\nCommittee. The grant of an Option shall not constitute or be evidence of any\nagreement or other understanding, \n\n                                       5\n\n\nexpress or implied, on the part of the Company or any Subsidiary to employ an\nindividual for any specific period.\n\n        (b) Grant of Limited Stock Appreciation Rights in the Event of Change of\nOwnership. If deemed by the Committee to be in the best interests of the\nCompany, any Option granted on or after the effective date of the Plan may\ninclude a Limited Stock Appreciation Right at the time of grant of the Option;\nalso, the Committee may grant a Limited Stock Appreciation Right with respect to\nany unexercised Option at any time after granting such Option prior to the end\nof its term, provided such Option was granted after the effective date of the\nPlan. Unless otherwise specified, any reference in this Plan to an Option or\nOptions shall include any associated Limited Stock Appreciation Right. Such\nLimited Stock Appreciation Rights shall be subject to such terms and conditions\nnot inconsistent with the Plan as the Committee shall impose, provided that:\n\n        (1) A Limited Stock Appreciation Right shall be exercisable only during\n            the ninety-one (91) day period specified in the last sentence of\n            Section 9(a), provided, however, that except in connection with a\n            Change of Ownership, no Limited Stock Appreciation Right granted to\n            a Participant who is subject to Section 16 of the Exchange Act shall\n            be exercisable within six (6) months of the date of its grant; and\n\n        (2) A Limited Stock Appreciation Right shall, upon its exercise, entitle\n            the optionee to whom such Limited Stock Appreciation Right was\n            granted to receive an amount of cash equal to the amount by which\n            the \"Offer Price per Share\" (as such term is hereinafter defined)\n            shall exceed the exercise price of the associated Option, multiplied\n            by the number of shares of Common Stock with respect to which such\n            Limited Stock Appreciation Right shall have been exercised. Upon the\n            exercise of a Limited Stock Appreciation Right, any associated\n            Option shall cease to be exercisable to the extent of the shares of\n            Common Stock with respect to which such Limited Stock Appreciation\n            Right was exercised. Upon the exercise or termination of an\n            associated Option, any related Limited Stock Appreciation Right\n            shall terminate to the extent of the shares of Common Stock with\n            respect to which such associated Option was exercised or terminated.\n\n            The term \"Offer Price per Share\" as used in this Section 6(b) shall\n            mean with respect to a Limited Stock Appreciation Right the higher\n            of (i) the fair market value per share of Common Stock on the date\n            of exercise of such Limited Stock Appreciation Right or (ii) the\n            highest price per share for Common Stock paid or to be paid in the\n            transaction, if any, giving rise to \n\n                                       6\n\n\n\n            the event specified in clauses (1) or (2) (as the case may be) of\n            Section 9(a) which triggered the exercisability of such Limited\n            Stock Appreciation Right. For purposes of clause (ii) above, any\n            securities or property which are part of the consideration paid or\n            to be paid in such transactions shall be valued in determining the\n            Offer Price per Share at the highest of (A) the valuation placed on\n            such securities or property by the company, person or other entity\n            engaging in such transaction, or (B) the valuation placed on such\n            securities or property by the Committee.\n\n        (c) Option Price.\n\n        (1) The price at which each share of Common Stock may be purchased upon\n            exercise of a particular Option shall be as specified by the\n            Committee, in its sole discretion, but in no event shall the\n            exercise price be less than 100% of the fair market value of a share\n            of Common Stock at the time such Option is granted, except that (i)\n            in the event that an optionee is required to make a payment or to\n            forego the receipt of other compensation pursuant to paragraph\n            (c)(3) below prior to receiving such Option, the exercise price per\n            share of Common Stock of such Option shall not be less than 100% of\n            the fair market value of a share of Common Stock at the time such\n            Option is granted less the purchase price per share of Common Stock\n            of such Option, and (ii) the Committee may specifically provide that\n            the exercise price of an Option may be higher or lower in the case\n            of an Option granted to employees of a company acquired by the\n            Company in assumption and substitution of options held by such\n            employees at the time such company is acquired.\n\n        (2) Unless approved by shareholders and subject to adjustment pursuant\n            to Section 4(d), the exercise price of any Option previously awarded\n            under the Plan may not be adjusted downward, whether through\n            amendment, cancellation or replacement grants, or by any other\n            means.\n\n        (3) If the Committee, in its discretion, shall deem it desirable, the\n            grant of an Option may be made conditional upon the receipt of a\n            payment therefor by the optionee or upon the optionee agreeing to\n            forego receipt of an amount of other compensation. Such condition\n            and the terms and conditions as to its satisfaction may also provide\n            for the reimbursement to the optionee of any part or all of such\n            payment under such circumstances as the Committee may specify.\n\n\n\n                                       7\n\n\n\n        (d) Exercise.\n\n        (1) Each Option shall be exercisable at such times and subject to such\n            terms and conditions as the Committee may, in its sole discretion,\n            specify, provided, however, that except in connection with a Change\n            of Ownership, (i) Options granted to Participants who are subject to\n            Section 16 of the Exchange Act shall not become exercisable within\n            six (6) months from the date of grant and (ii) in no event may any\n            Option granted hereunder be exercisable after the expiration of 15\n            years from the date of such grant. Subject to the foregoing, each\n            Option grant shall specify the effect thereon of the death,\n            retirement or other termination of employment of the optionee. In\n            addition, the Committee may impose such other conditions with\n            respect to the exercise of Options, including without limitation,\n            any relating to the application of Federal or state securities laws,\n            as it may deem necessary or advisable.\n\n        (2) No shares shall be delivered pursuant to any exercise of an Option\n            until the Participant has made payment in full of the option price\n            therefor or provision for such payment satisfactory to the\n            Committee. The exercise price of an Option may be paid in cash or\n            certified or cashiers' check or by delivery (either actually or by\n            attestation) of shares of Common Stock that have been acquired or\n            held by the Participant in such manner as to not result in an\n            accounting charge. To the extent authorized by the Committee, either\n            at the time of grant or at the time of exercise of an Option, the\n            exercise price of an Option also may be paid through one of more of\n            the following: (i) shares of capital stock of the Corporation, (ii)\n            other property deemed acceptable by the Committee, (iii) a reduction\n            in the number of shares or other property otherwise issuable\n            pursuant to such Option, (iv) a promissory note of or other\n            commitment to pay by the Participant or of a third party, the terms\n            and conditions of which shall be determined by the Committee, or\n            (vi) any combination of the foregoing. No optionee or the legal\n            representative, legatee or distributee of an optionee shall be\n            deemed to be a holder of any shares subject to any Option prior to\n            the issuance of such shares upon exercise of such Option.\n\n        (e) Transferability of Options. Unless the documents evidencing the\ngrant of an Option (or an amendment thereto authorized by the Committee)\nexpressly states that the Option is transferable as provided hereunder, no\nOption granted under the Plan may be sold, assigned, conveyed, gifted, pledged,\nhypothecated or otherwise transferred in any manner, other than by will or the\nlaws of descent and distribution. The Committee may in its sole discretion grant\nan Option or amend an outstanding Option to provide that the Option is\ntransferable or assignable to a member or members \n\n\n                                       8\n\n\n\nof the Participant's \"immediate family,\" as such term is defined under Exchange\nAct Rule 16a-1(e), or to a trust for the benefit solely of a member or members\nof the Participant's immediate family, or to a partnership or other entity whose\nonly owners are members of the Participant's family, provided that (1) no\nconsideration is given in connection with the transfer of such Option, and (2)\nfollowing any such transfer or assignment the Option will remain subject to\nsubstantially the same terms applicable to the Option while held by the\nParticipant, as modified as the Committee in its sole discretion shall determine\nappropriate, and the transferee shall agree to be bound by such terms.\n\n        SECTION 7. PERFORMANCE STOCK AWARDS AND RESTRICTED STOCK AWARDS.\n\n         (a) Performance Stock Awards. Subject to the terms of this Plan,\nPerformance Stock Awards may be granted to Participants by the Committee from\ntime to time at its sole discretion. Performance Stock Awards shall consist of\nan award of shares of Common Stock, the grant, issuance, retention and\/or\nvesting of which shall be subject to such Performance Objectives, and to such\nfurther terms and conditions as the Committee deems appropriate. Each\nPerformance Stock Award shall contain provisions regarding (1) the number of\nshares of Common Stock subject to such Award or a formula for determining such,\n(2) the performance criteria and level of achievement versus these criteria\nwhich shall determine the number of shares of Common Stock granted, issued,\nretainable and\/or vested, (3) the period as to which performance shall be\nmeasured for determining achievement of such performance criteria (a\n\"Performance Period\"), (4) forfeiture provisions, and (5) such further terms and\nconditions, in each case not inconsistent with the Plan as may be determined\nfrom time to time by the Committee. The grant, issuance, retention and\/or\nvesting of each Performance Stock Award shall be subject to such performance\ncriteria and level of achievement versus these criteria as the Committee shall\ndetermine, which criteria may be based on financial performance and\/or personal\nperformance evaluations. Notwithstanding anything to the contrary herein, the\nperformance criteria for any Performance Stock that is intended by the Committee\nto satisfy the requirements for \"performance-based compensation\" under Code\nSection 162(m) shall be a measure based on one or more Performance Objectives\nselected by the Committee and specified at the time the Performance Stock Award\nis granted. Notwithstanding anything in this Plan to the contrary, Performance\nStock Awards may provide that upon satisfaction of Performance Objectives the\nshares subject to the Award are subject to such further holding periods and\/or\nrestrictions on transferability as the Committee may provide.\n\n        (b) Restricted Stock Awards. Subject to the terms of this Plan,\nRestricted Stock Awards may be granted to Participants by the Committee from\ntime to time at its sole discretion. Restricted Stock consists of shares of\nCommon Stock which are registered or are issuable by the Company in the name of\na Participant in exchange for such cash or\n\n\n\n                                       9\n\n\nother consideration, if any, as determined by the Committee. Restricted Stock\nshall be subject during specified periods of time to such conditions to vesting,\nto restrictions on their sale or other transfer by the Participant and\/or to\nrepurchase rights as may be determined by the Committee, consistent with the\nterms of the Plan. The transfer and sale of shares of Common Stock pursuant to\nRestricted Stock Awards shall be subject to the following terms and conditions:\n\n        (1) The number of shares of Common Stock to be transferred or sold by\n            the Company to a Participant pursuant to a Restricted Stock award\n            shall be determined by the Committee.\n\n        (2) Subject to the requirements of applicable law, the Committee shall\n            determine the price, if any, at which shares of Restricted Stock\n            shall be sold or awarded to a Participant, which may vary from time\n            to time and among Participants and which may be below the fair\n            market value of such Shares at the date of grant or issuance.\n\n        (3) All shares of Common Stock transferred or sold as Restricted Stock\n            hereunder shall be subject to such restrictions or conditions as the\n            Committee may determine, including, without limitation any or all of\n            the following: (i) a prohibition against the sale, transfer, pledge\n            or other encumbrance of the Shares, such prohibition to lapse at\n            such time or times as the Committee shall determine (whether in\n            annual or more frequent installments, at the time of the death,\n            disability or retirement of the holder of such Shares, or\n            otherwise); (ii) a requirement that the holder of shares of Common\n            Stock forfeit or resell back to the Company at a price specified by\n            the Committee (which price may be more than the price, if any, paid\n            by the Participant for such Shares) all or part of such shares of\n            Common Stock in the event of termination of employment during any\n            period in which such shares of Common Stock are subject to\n            conditions; (iii) such other conditions or restrictions as the\n            Committee may deem advisable; and (iv) any applicable Performance\n            Objectives which, if achieved, shall cause acceleration of the\n            lapsing of restrictions imposed upon all or part of the shares\n            covered by the Restricted Stock Award.\n\nNotwithstanding anything else in this Plan to the contrary, the restrictions set\nforth in Section 7(b)(3) shall not lapse with respect to a Restricted Stock\nAward before the second anniversary of the date of grant of such Restricted\nStock Award, provided, however, that the Committee, in its sole discretion, may\ndesignate that such restrictions shall lapse upon the achievement of Performance\nObjectives. Subject to the preceding sentence, once established, Performance\nObjectives and the terms under which the lapsing of restrictions may be\naccelerated may be changed, adjusted or amended by the\n\n                                       10\n\n\n Committee in its sole discretion. Notwithstanding anything in this Plan to the\ncontrary, Restricted Stock Awards may provide that upon the lapsing of\nrestrictions set forth above, the shares subject to the Award may be subject to\nsuch further holding periods and\/or restrictions on transferability as the\nCommittee may provide.\n\n        (c) Rights with Respect to Shares. Unless the terms of the Award provide\notherwise, unless and until forfeited pursuant to the terms of this Plan or the\nAward, a Participant shall have the right to vote and to receive dividends and\nother distributions on shares subject to a Performance Stock Award or Restricted\nStock Award, subject, however, to the terms, conditions and restrictions\ndescribed in this Plan and the Award.\n\n        (d) Escrow. Shares of Common Stock issued pursuant to a Performance\nStock Award or Restricted Stock Award may be held in escrow by the Company until\nsuch time as the Committee shall have determined that the restrictions set forth\nin Section 7 have lapsed or until the shares subject to such Performance Stock\nAward or Restricted Stock Award are forfeited pursuant to their terms.\n\n        (e) Restrictive Legends. Certificates for shares of Common Stock\ndelivered pursuant to Performance Stock Awards or Restricted Stock Awards may\nbear an appropriate legend referring to the terms, conditions and restrictions\ndescribed in this Plan and in the applicable Award. Any attempt to dispose of\nany such shares of Common Stock in contravention of the terms, conditions and\nrestrictions described in this Plan or in the applicable Award shall be\nineffective. Any shares of Common Stock of the Company or other property,\nincluding cash, received by a Participant as a dividend or as a result of any\nstock split, combination, exchange of shares, reorganization, merger,\nconsolidation or similar event with respect to shares of Common Stock received\npursuant to a Performance Stock Award or Restrictive Stock Award shall have the\nsame status and bear the same legend and be held in escrow pursuant to Section\n7(d) as the shares received pursuant to the Performance Stock Award or\nRestricted Stock Award unless otherwise determined by the Committee at the time\nof such event.\n\n        (f) Designation of Beneficiaries. A Participant may designate a\nbeneficiary or beneficiaries to receive such Participant's Common Stock\nhereunder in the event of such Participant's death, and may, at any time and\nfrom time to time, change any such beneficiary designation. All beneficiary\ndesignations and changes therein shall be in writing and shall be effective if\nand when delivered to the Committee during the lifetime of the Participant.\n\n        (g) Discretionary Adjustments. Notwithstanding satisfaction of any\nPerformance Objectives, the number of shares of Common Stock granted, issued,\nretainable and\/or vested under a Performance Stock Award on account of either\nfinancial performance or \n\n\n                                       11\n\n\n\npersonal performance evaluations may be reduced by the Committee on the basis of\nsuch further considerations as the Committee in its sole discretion shall\ndetermine. The Committee may make adjustments or modifications, and its\ndetermination thereof shall be conclusive, in any applicable Performance\nObjectives to give effect to the intent of this Plan in connection with any\nevent affecting the performance criteria established as the Performance\nObjectives, including without limitation, any reorganization, recapitalization,\nmerger, consolidation, offering of additional shares of Common Stock or other\nchange in the Company's shareholders' equity by means other than earnings, or\nany similar event. The grant of an Award shall not constitute or be evidence of\nany agreement or other understanding, express or implied, on the part of the\nCompany or any Subsidiary to employ an individual for any specific period.\n\n        SECTION 8. STOCK UNIT AWARDS.\n\n        (a) Grant of Stock Unit Awards. The Committee shall have authority to\ngrant to Participants Stock Unit Awards, the value of which is based, in whole\nor in part, on the value of Common Stock. Each \"Stock Unit\" shall consist of a\nbookkeeping entry representing an amount equivalent to the fair market value of\none share of Common Stock. Such Stock Units represent an unfunded and unsecured\nobligation of the Company, except as otherwise provided for by the Committee.\nStock Units may be granted as additional compensation or in lieu of any other\ncompensation, as specified by the Committee, or may be issued upon exercise of\nOptions, or in lieu of a Performance Stock Award or Restricted Stock Award,\nprovided that for any Common Stock to be purchased in connection with a Stock\nUnit Award other than upon exercise of an Option or in settlement of a\nPerformance Stock Award or Restricted Stock Award, the purchase price or the\namount of consideration paid or of other compensation foregone shall be equal to\nat least 100% of the fair market value of such Common Stock on the date such\nAward is granted. Subject to the provisions of the Plan, Stock Unit Awards shall\nbe subject to such terms, restrictions, conditions, vesting requirements and\npayment rules as the Committee may determine in its sole discretion.\n\n        (b) Transferability of Stock Units. Unless the Stock Unit Award (or an\namendment thereto authorized by the Committee) expressly states otherwise, any\nshares of Common Stock which are part of a Stock Unit Award shall not be\nassigned, sold transferred, pledged or otherwise encumbered before the date on\nwhich the shares are issued.\n\n        (c) Settlement of Stock Units. Unless provided otherwise by the\nCommittee at the time of grant, settlement of Stock Units shall be made by\nissuance of Common Stock and shall occur within 60 days after a Participant's\ntermination of employment for any reason. The Committee may provide in the terms\nof the Stock Unit Award for Stock Units to be settled in cash (at the election\nof the Company or the Participant, as \n\n                                       12\n\n\n\nspecified by the Committee) and to be made at such other times as it determines\nappropriate or as it permits a Participant to choose. The amount of shares of\nCommon Stock, or other settlement medium, to be so distributed may be increased\nby an interest factor or by dividend equivalents, which may be valued as if\nreinvested in Common Stock. Until a Stock Unit is settled, the number of shares\nof Common Stock represented by a Stock Unit shall be subject to adjustment\npursuant to Section 4(d).\n\n\n                                       13\n\n\n\n        SECTION 9. SPECIAL RULES.\n\n        (a) Notwithstanding anything to the contrary in this Plan, unless\notherwise specifically determined by the Committee at the time of grant, all\nOptions theretofore granted and not fully exercisable shall become exercisable\nin full and the restrictions on all outstanding Awards shall lapse upon the\noccurrence of a Change of Ownership. A \"Change of Ownership\" shall be deemed to\nhave occurred if either (1) individuals who, as of the effective date of this\nPlan, constitute the Board of Directors of the Company (the \"Board of Directors\"\ngenerally and as of the date hereof the \"Incumbent Board\") cease for any reason\nto constitute at least a majority of the directors constituting the Board of\nDirectors, provided that any person becoming a director subsequent to the\neffective date of this Plan whose election, or nomination for election by the\nCompany's shareholders, was approved by a vote of at least three-quarters (3\/4)\nof the then directors who are members of the Incumbent Board (other than an\nelection or nomination of an individual whose initial assumption of office is\n(i) in connection with the acquisition by a third person, including a \"group\" as\nsuch term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as\namended (the \"Act\"), of beneficial ownership, directly or indirectly, of 20% or\nmore of the combined voting securities ordinarily having the right to vote for\nthe election of directors of the Company (unless such acquisition of beneficial\nownership was approved by a majority of the Board of Directors who are members\nof the Incumbent Board), or (ii) in connection with an actual or threatened\nelection contest relating to the election of the directors of the Company, as\nsuch terms are used in Rule 14a-11 of Regulation 14A promulgated under the Act)\nshall be, for purposes of this Plan, considered as though such person were a\nmember of the Incumbent Board, or (2) the Board of Directors (a majority of\nwhich shall consist of directors who are members of the Incumbent Board) has\ndetermined that a Change of Ownership triggering the exercisability of Options\nand the lapse of restrictions on Awards as described in this Section 10 shall\nhave occurred. Options which become fully exercisable by reason of events\nspecified in clauses (1) or (2) shall remain exercisable for 90 days following\nthe date on which they become so exercisable, after which they will revert to\nbeing exercisable in accordance with their original terms, provided, however,\nthat no Option which has previously been exercised or has expired or otherwise\nterminated shall become exercisable by virtue of this Section nor shall this\nSection permit exercise of any option during the portion, if any, of such 90 day\nperiod which follows the termination or expiration of any such Option.\n\n        (b) For purposes of this Plan and any Option or Award hereunder,\ntermination of employment shall not be deemed to occur upon the transfer of any\noptionee from the employ of the Company to the employ of any Subsidiary or\naffiliate. For purposes of\n\n\n                                       14\n\n\n\nthis Plan, \"affiliate\" means (1) any entity 50% or more of the voting interest\nin which is owned, directly or indirectly, by an entity which owns, directly or\nindirectly, 50% or more of the voting interest in the Company and (2) any entity\nwhich owns, directly or indirectly, 50% or more of the voting interest in the\nCompany.\n\n        (c) Either at the time an Award is granted or by subsequent action, the\nCommittee may impose such restrictions, conditions or limitations as it\ndetermines appropriate as to the timing and manner of any resales by a\nParticipant or other subsequent transfers by a Participant of any shares issued\nunder an Award, including without limitation (i) restrictions under an insider\ntrading policy, (ii) restrictions designed to delay and\/or coordinate the timing\nand manner of sales by Participants, and (iii) restrictions as to the use of a\nspecified brokerage firm for such resales or other transfers.\n\n        (d) The existence of outstanding Awards (including any Options) shall\nnot affect in any way the right or power of the Company or its stockholders to\nmake or authorize any or all adjustments, recapitalizations, reorganizations,\nexchanges, or other changes in the Company's capital structure or its business,\nor any merger or consolidation of the Company, or any issuance of shares or\nother securities or subscription rights thereto, or any issuance of bonds,\ndebentures, preferred or prior preference stock ahead of or affecting the shares\nor the rights thereof, or the dissolution or liquidation of the Company, or any\nsale or transfer of all or any part of its assets or business, or any other\ncorporate act or proceeding, whether of a similar character or otherwise.\nFurther, except as herein expressly provided, (i) the issuance by the Company of\nshares of stock or any class of securities convertible into shares of stock of\nany class, for cash, property, labor or services, upon direct sale, upon the\nexercise of rights or warrants to subscribe therefor, or upon conversion of\nshares or obligations of the Company convertible into such shares or other\nsecurities, (ii) the payment of a dividend in property other than Common Stock,\nor (iii) the occurrence of any similar transaction, and in any case whether or\nnot for fair value, shall not affect, and no adjustment by reason thereof shall\nbe made with respect to, the number of shares subject to Options theretofore\ngranted or the purchase price per share, unless the Committee shall determine in\nits sole discretion that an adjustment is necessary to provide equitable\ntreatment to Participant.\n\n        SECTION 10. DELIVERY OF SHARES. No shares of Common Stock shall be\ndelivered pursuant to an Award or any exercise of an Option until the\nrequirements of such laws and regulations as may be deemed by the Committee to\nbe applicable thereto are satisfied.\n\n\n\n                                       15\n\n\n        SECTION 11. FINANCING AND WITHHOLDING.\n\n        (a) Withholding of Taxes. As a condition to the making of an Award, to\nthe lapse of the restrictions pertaining to an Award, to the transfer of shares\nissued under an Award or to the delivery of shares in connection with the\nexercise of an Option, the Company may require the Participant to pay to the\nCompany, or make arrangements satisfactory to the Committee regarding payment\nof, any taxes of any kind required by law to be withheld with respect to such\nshares of Common Stock.\n\n        (b) Financing. If requested by a Participant who exercises an Option or\nwho has received shares of Common Stock pursuant to an Award, the Committee may\nin its discretion provide financing to the Participant in a principal amount\nsufficient for the purchase of shares of Common Stock pursuant to such Option\nexercise or under such Award, and\/or to pay the amount of taxes required by law\nto be withheld with respect to such Option exercise or such receipt of shares of\nCommon Stock. Any such loan shall be subject to all legal requirements, and\nrestrictions pertinent thereto, including if applicable, Regulation G\npromulgated by the Federal Reserve Board. The grant of an Option or Award shall\nin no way obligate the Company or the Committee to provide any financing\nwhatsoever upon the lapse of restrictions on shares or the exercise of such\nOption.\n\n        (c) Withholding of Shares.\n\n        (1) If requested by a Participant who acquires shares of Common Stock\n            upon the exercise of an Option or who has received Common Stock\n            pursuant to an Award with respect to which the restrictions shall\n            have lapsed, the Committee may in its discretion permit the\n            Participant to satisfy any tax withholding obligations, in whole or\n            in part, by having the Company withhold a portion of such shares\n            with a value equal to the amount of taxes required by law to be\n            withheld.\n\n        (2) Requests by a Participant to have shares of Common Stock withheld\n            shall be (i) made prior to the Tax Date and (ii) irrevocable.\n\n        SECTION 12. AMENDMENTS, SUSPENSION OR DISCONTINUANCE. The Board of\nDirectors may amend, suspend or discontinue the Plan or any Option or Award\ngranted under the Plan. Notwithstanding the foregoing, except as permitted by\nSection 4(c), the Board may not, without prior approval of the shareholders of\nthe Company, make any amendment which operates (a) to reduce the exercise price\nof outstanding Options or amend the provisions of Section 6(c)(2) relating to\nrepricing Options, (b) to materially increase the total number of shares of\nCommon Stock which may be delivered in respect of Awards or on exercise of\nOptions granted under the Plan, (c) to \n\n\n\n                                       16\n\n\nextend the maximum option period or the period which Options or Awards may be\ngranted under the Plan or (d) to reduce the minimum permissible Option exercise\nprice.\n\n        SECTION 13. TERM OF PLAN. The Plan shall become effective on the date it\nis approved and adopted by the Board, subject to its subsequent approval by\nshareholders of the Company. No Option or Award shall be granted under the Plan\nafter the date that is ten (10) years after the date on which the Plan is\napproved by the Company's shareholders or after such earlier date as the\nCommittee may decide, in its sole discretion.\n\n        SECTION 14. OPTION GRANTS BY SUBSIDIARIES. In the case of a grant of an\noption to any Participant by a Subsidiary, such grant may, if the Committee so\ndirects, be implemented by the Corporation issuing any subject shares to the\nSubsidiary, for such lawful consideration as the Committee may determine, upon\nthe condition or understanding that the Subsidiary will transfer the shares to\nthe optionholder in accordance with the terms of the option specified by the\nCommittee pursuant to the provisions of the Plan. Notwithstanding any other\nprovision hereof, such option may be issued by and in the name of the Subsidiary\nand shall be deemed granted on such date as the Committee shall determine.\n\n        SECTION 15. LIABILITY OF COMPANY. The Company and any Affiliate which is\nin existence or hereafter comes into existence shall not be liable to a\nParticipant, an Eligible Person or other persons as to:\n\n        (a) The Non-Issuance of Shares. The non-issuance or sale of shares as to\nwhich the Company has been unable to obtain from any regulatory body having\njurisdiction the authority deemed by the Company's counsel to be necessary to\nthe lawful issuance and sale of any shares hereunder; and\n\n        (b) Tax Consequences. Any tax consequence expected, but not realized, by\nany Participant, Eligible Person or other person due to the receipt, exercise or\nsettlement of any option or other Award granted hereunder.\n\n        SECTION 16. NON-EXCLUSIVITY OF THE PLAN. Neither the adoption of the\nPlan by the Board nor the submission of the Plan to the shareholders of the\nCompany for approval shall be construed as creating any limitations on the power\nof the Board or the Committee to adopt such other incentive arrangements as it\nor they may deem desirable, including without limitation, the granting of\nrestricted stock or stock options otherwise than under the Plan, and such\narrangements may be either generally applicable or applicable only in specific\ncases.\n\n\n                                       17\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7964],"corporate_contracts_industries":[9480],"corporate_contracts_types":[9539,9545],"class_list":["post-38436","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-kb-home","corporate_contracts_industries-construction__contractors","corporate_contracts_types-compensation","corporate_contracts_types-compensation__esp"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38436","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38436"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38436"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38436"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38436"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}