{"id":40633,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/stock-option-plan-united-defense-industries-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"stock-option-plan-united-defense-industries-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/stock-option-plan-united-defense-industries-inc.html","title":{"rendered":"Stock Option Plan &#8211; United Defense Industries Inc."},"content":{"rendered":"<pre>\n                        UNITED DEFENSE STOCK OPTION PLAN\n\n         United Defense Industries, Inc. (the 'Company'), a Delaware\ncorporation, hereby adopts this United Defense Stock Option Plan. The purposes\nof this Plan are as follows:\n\n         (1) To further the growth, development, and financial success of the\n         Company and its Affiliates (as defined herein), by providing additional\n         incentives to employees and directors of the Company and employees of\n         its Affiliates who have been or will be given responsibility for the\n         management or administration of the Company's (and\/or one or more of\n         its Affiliates') business affairs, by assisting them to become owners\n         of Common Stock, thereby benefiting directly from the growth,\n         development and financial success of the Company.\n\n         (2) To enable the Company (and its Affiliates) to obtain and retain the\n         services of the type of professional, technical, and managerial\n         employees and directors considered essential to the long-range success\n         of the Company by providing and offering them an opportunity to become\n         owners of Common Stock under Options, including, in the case of\n         Employees of the Company and its Subsidiaries, Options that are\n         intended to qualify as 'incentive stock options' under Section 422 of\n         the Code (as defined herein).\n\n                                   ARTICLE I.\n\n                                  DEFINITIONS\n                                  -----------\n\n         Whenever the following terms are used in this Plan, they shall have the\nmeaning specified below unless the context clearly indicates to the contrary.\nThe singular pronoun shall include the plural where the context so indicates.\n\nSection 1.1.      Affiliate\n------------      ---------\n\n         'Affiliate' shall mean, with respect to any Person, any other Person\ndirectly or indirectly controlling, controlled by, or under common control with,\nsuch Person where 'control' shall have the meaning given such term under Rule\n405 of the Securities Act.\n\nSection 1.2.      Board\n------------      -----\n\n         'Board' shall mean the Board of Directors of the Company.\n\nSection 1.3.      CEO\n------------      ---\n\n         'CEO' shall mean Chief Executive Officer of the Company.\n\nSection 1.4.      Code\n------------      ----\n\n         'Code' shall mean the Internal Revenue Code of 1986, as amended.\n\n\n\n\n\nSection 1.5.      Committee\n------------      ---------\n\n         'Committee' shall mean the Compensation Committee of the Board, or\nanother committee or subcommittee of the Board, appointed as provided in Section\n6.1.\n\nSection 1.6.      Common Stock\n------------      ------------\n\n         'Common Stock' shall mean the common stock, par value $0.01 per share,\nof the Company.\n\nSection 1.7.      Company\n------------      -------\n\n         'Company' shall mean United Defense Industries, Inc. In addition,\n'Company' shall mean any corporation assuming, or issuing new employee stock\noptions in substitution for, Incentive Stock Options outstanding under the Plan\nin a transaction to which Section 424(a) of the Code applies.\n\nSection 1.8.      Controlled Entity\n------------      -----------------\n\n         'Controlled Entity' shall mean either of (i) UDLP Holdings Corp. or\n(ii) the Partnership.\n\nSection 1.9.      Corporate Event\n------------      ---------------\n\n         'Corporate Event' is defined in Section 7.1(a).\n\nSection 1.10.     Director\n-------------     --------\n\n         'Director' shall mean a member of the Board.\n\nSection 1.11.     Eligible Representative\n-------------     -----------------------\n\n         'Eligible Representative' for an Optionee shall mean such Optionee's\npersonal representative or such other person as is empowered under the deceased\nOptionee's will or the then applicable laws of descent and distribution to\nrepresent the Optionee hereunder.\n\nSection 1.12.     Employee\n-------------     --------\n\n         'Employee' shall mean any employee (as defined in accordance with the\nregulations and revenue rulings then applicable under Section 3401(c) of the\nCode) of the Company and\/or one or more of its Affiliates, whether such employee\nis so employed at the time this Plan is adopted or becomes so employed\nsubsequent to the adoption of this Plan.\n\nSection 1.13.     Exchange Act\n-------------     ------------\n\n         'Exchange Act' shall mean the Securities Exchange Act of 1934, as\namended.\n\nSection 1.14.     Incentive Stock Option\n-------------     ----------------------\n\n         'Incentive Stock Option' shall mean an Option which qualifies under\nSection 422 of the Code and which is designated as an Incentive Stock Option by\nthe Committee.\n\n\n                                       2\n\n\n\n\nSection 1.15.     Independent Director\n-------------     --------------------\n\n         'Independent Director' shall mean a member of the Board who is not an\nEmployee of the Company.\n\nSection 1.16.     Non-Qualified Option\n-------------     --------------------\n\n         'Non-Qualified Option' shall mean an Option which is not an 'incentive\nstock option' under Section 422 of the Code and shall include an Option which is\ndesignated as a Non-Qualified Option by the Committee.\n\nSection 1.17.     Officer\n-------------     -------\n\n         'Officer' shall mean an officer of the Company, as defined in Rule\n16a-1(f) under the Exchange Act, as such Rule may be amended in the future.\n\nSection 1.18.     Option\n-------------     ------\n\n         'Option' shall mean an option  granted under the Plan to purchase\nCommon Stock. 'Options' includes both Incentive Stock Options and Non-Qualified\nOptions.\n\nSection 1.19.     Optionee\n-------------     --------\n\n         'Optionee' shall mean an Employee or Independent Director to whom an\nOption is granted under the Plan.\n\nSection 1.20.     Person\n-------------     ------\n\n         'Person' shall mean an individual, partnership, corporation, limited\nliability company, business trust, joint stock company, trust, unincorporated\nassociation, joint venture, governmental authority or other entity of whatever\nnature.\n\nSection 1.21.     Plan\n-------------     ----\n\n         'Plan' shall mean this United Defense Stock Option Plan.\n\nSection 1.22.     Secretary\n-------------     ---------\n\n         'Secretary' shall mean the Secretary of the Company.\n\nSection 1.23.     Securities Act\n-------------     --------------\n\n         'Securities Act' shall mean the Securities Act of 1933, as amended.\n\nSection 1.24.     Stock Option Agreement\n-------------     ----------------------\n\n         'Stock Option Agreement' shall mean the written Stock Option Agreement\nbetween the Company and an Optionee evidencing an Option granted under the Plan\nas described in Section 4.1.\n\n\n                                       3\n\n\n\n\n\nSection 1.25.     Stockholders Agreement\n-------------     ----------------------\n\n         'Stockholders Agreement' shall mean the Stockholders Agreement by and\namong United Defense Industries, Inc., Iron Horse Investors, L.L.C. and an\nOptionee, as amended from time to time.\n\nSection 1.26.     Subsidiary\n-------------     ----------\n\n         'Subsidiary' of any entity shall mean any corporation in an unbroken\nchain of corporations beginning with such entity if each of the corporations\nother than the last corporation in the unbroken chain then owns stock possessing\n50% or more of the total combined voting power of all classes of stock in one of\nthe other corporations in such chain.\n\nSection 1.27.     Termination of Directorship\n-------------     ---------------------------\n\n         'Termination of Directorship' shall mean the time when an Optionee who\nis an Independent Director ceases to be a Director for any reason, including but\nnot by way of limitation, a termination by resignation, failure to be elected or\nappointed, death or retirement. The Board, in its sole discretion, shall\ndetermine the effect of all matters and questions relating to Termination of\nDirectorship.\n\nSection 1.28.     Termination of Employment\n-------------     -------------------------\n\n         'Termination of Employment' shall mean the time when the\nemployee-employer relationship between the Optionee and the Company (and\/or one\nor more of its Affiliates) is terminated for any reason, with or without cause,\nincluding, but not by way of limitation, a termination by resignation,\ndischarge, death or retirement, but excluding a termination where the Optionee\nis simultaneously reemployed by, or remains employed by, the Company and\/or one\nor more of its Affiliates or a successor entity thereto. The Committee shall\ndetermine the effect of all matters and questions relating to Termination of\nEmployment, including, but not by way of limitation, the question of whether a\nTermination of Employment resulted from a discharge for good cause, and all\nquestions of whether a particular leave of absence constitutes a Termination of\nEmployment; provided, however, that, with respect to Incentive Stock Options, a\nleave of absence shall constitute a Termination of Employment if, and to the\nextent that, such leave of absence interrupts employment for the purposes of\nSection 422(a)(2) of the Code and the then applicable regulations and revenue\nrulings under said Section of the Code.\n\n                                  ARTICLE II.\n\n                             SHARES SUBJECT TO PLAN\n                             ----------------------\n\nSection 2.1.      Shares Subject to Plan\n------------      ----------------------\n\n         The shares of stock subject to Options shall be shares of Common Stock.\nSubject to Section 7.1, the aggregate number of such shares which may be issued\nupon exercise of Options shall not exceed 1,500,000.\n\n\n                                       4\n\n\n\n\n\nSection 2.2.      Unexercised Options\n------------      -------------------\n\n         If any Option (or portion thereof) expires or is canceled without\nhaving been fully exercised, the number of shares subject to such Option (or\nportion thereof) but as to which such Option was not exercised prior to its\nexpiration or cancellation may again be optioned hereunder, subject to the\nlimitations of Section 2.1.\n\n                                  ARTICLE III.\n\n                               GRANTING OF OPTIONS\n                               -------------------\n\nSection 3.1.      Eligibility\n------------      -----------\n\n         Any executive or other key Employee of the Company and\/or of one or\nmore of its Affiliates and any Independent Director shall be eligible to be\ngranted Options, except as provided in Section 3.2.\n\nSection 3.2.      Qualification of Incentive Stock Options\n------------      ----------------------------------------\n\n         No Incentive Stock Option shall be granted to any person who is not an\nEmployee of the Company and\/or one of its Subsidiaries.\n\nSection 3.3.      Granting of Options to Employees\n------------      --------------------------------\n\n         (a) The Committee shall from time to time:\n\n                  (i) Determine which Employees are executive or other key\n         Employees and select from among them (including those to whom Options\n         have been previously granted under the Plan) such of them as in its\n         opinion should be granted Options;\n\n                  (ii) Determine the number of shares to be subject to such\n         Options granted to such Employees, and determine whether such Options\n         are to be Incentive Stock Options or Non-Qualified Options; and\n\n                  (iii) Determine the terms and conditions of such Options,\n         consistent with the Plan.\n\n         (b) Upon the selection of an executive or other key Employee to be\ngranted an Option pursuant to Section 3.3(a), the Committee shall instruct the\nSecretary to issue such Option and may impose such conditions on the grant of\nsuch Option as it deems appropriate. Without limiting the generality of the\npreceding sentence, the Committee may require as a condition on the grant of an\nOption to an Employee that the Employee surrender for cancellation some or all\nof the unexercised Options which have been previously granted to him or her. An\nOption the grant of which is conditioned upon such surrender may have an Option\nprice lower (or higher) than the Option price of the surrendered Option, may\ncover the same (or a lesser or greater) number of shares as the surrendered\nOption, may contain such other terms as the Committee deems appropriate and\nshall be exercisable in accordance with its terms, without regard to the number\nof shares, price, period of exercisability or any other term or condition of the\nsurrendered Option.\n\n\n                                       5\n\n\n\n\n\nSection 3.4.      Granting of Option to Independent Directors\n------------      -------------------------------------------\n\n         (a) The Board shall from time to time:\n\n                  (i) Select from among the Independent Directors (including\n         those to whom Options have previously been granted under the Plan) such\n         of them as in its opinion should be granted Options;\n\n                  (ii) Determine the number of shares to be subject to such\n         Options granted to such selected Independent Directors;\n\n                  (iii) Determine the terms and conditions of such Options,\n         consistent with the Plan; provided, however, that all Options granted\n         to Independent Directors shall be Non-Qualified Options.\n\n         (b) Upon the selection of an Independent Director to be granted an\nOption pursuant to Section 3.4(a), the Board shall instruct the Secretary to\nissue such Option and may impose such conditions on the grant of such Option as\nit deems appropriate. Without limiting the generality of the preceding sentence,\nthe Board may require as a condition on the grant of an Option to an Independent\nDirector that the Independent Director surrender for cancellation some or all of\nthe unexercised Options which have been previously granted to him or her. An\nOption the grant of which is conditioned upon such surrender may have an Option\nprice lower (or higher) than the Option price of the surrendered Option, may\ncover the same (or a lesser or greater) number of shares as the surrendered\nOption, may contain such other terms as the Board deems appropriate and shall be\nexercisable in accordance with its terms, without regard to the number of\nshares, price, period of exercisability or any other term or condition of the\nsurrendered Option.\n\n                                   ARTICLE IV.\n\n                                TERMS OF OPTIONS\n                                ----------------\n\nSection 4.1.      Option Agreement\n------------      ----------------\n\n         Each Option shall be evidenced by a written Stock Option Agreement,\nwhich shall be executed by the Optionee and an authorized Officer of the Company\nand which shall contain such terms and conditions as the Committee (or the\nBoard, in the case of Options granted to Independent Directors) shall determine,\nconsistent with the Plan. Stock Option Agreements evidencing Incentive Stock\nOptions shall contain such terms and conditions as may be necessary to qualify\nsuch Options as 'incentive stock options' under Section 422 of the Code.\n\nSection 4.2.      Exercisability of Options\n------------      -------------------------\n\n         (a) Each Option shall become exercisable according to the terms of the\napplicable Stock Option Agreement; provided, however, that by a resolution\nadopted after an Option is granted the Committee (or the Board, in the case of\nOptions granted to Independent Directors) may, on such terms and conditions as\nit may determine to be appropriate and subject to Sections 4.2(b) and 4.2(c),\naccelerate the time at which such Option or any portion thereof may be\nexercised.\n\n\n                                       6\n\n\n\n\n\n         (b) No portion of an Option which is unexercisable at Termination of\nEmployment or Termination of Directorship shall thereafter become exercisable\nunless the Committee shall determine otherwise.\n\n         (c) To the extent that the aggregate fair market value (determined as\nof the date of grant of the Option granted with respect to such stock) of shares\nwith respect to which 'incentive stock options' (within the meaning of Section\n422 of the Code, but without regard to Section 422(d) of the Code) are\nexercisable for the first time by an Optionee during any calendar year (under\nthe Plan and all other incentive stock option plans of the Company or any\nSubsidiary thereof) exceeds $100,000, such options shall be treated and taxable\nas Non-Qualified Options. The rule set forth in the preceding sentence shall be\napplied by taking options into account in the order in which they were granted,\nand the stock issued upon exercise of options shall designate whether such stock\nwas acquired upon exercise of an Incentive Stock Option.\n\nSection 4.3.      Option Price\n------------      ------------\n\n         (a) The price of the shares subject to each Option shall be set by the\nCommittee (or the Board, in the case of Options granted to Independent\nDirectors) provided, however, that in the case of an Incentive Stock Option, the\nprice per share shall be not less than 100% of the fair market value of such\nshares on the date such Option is granted; and that in the case of an individual\nthen owning (within the meaning of Section 424(d) of the Code) more than 10% of\nthe total combined voting power of all classes of stock of the Company, the\nprice per share shall not be less than 110% of the fair market value of such\nshares on the date such Incentive Stock Option is granted.\n\n         (b) For purposes of the Plan, the fair market value of a share of the\nCommon Stock as of a given date shall be: (i) the closing price of a share of\nthe Common Stock on the principal exchange on which such shares are then\ntrading, if any, on the day previous to such date, or, if shares were not traded\non the day previous to such date, then on the next preceding trading day during\nwhich a sale occurred; or (ii) if such Common Stock is not traded on an exchange\nbut is quoted on NASDAQ or a successor quotation system, (A) the last sales\nprice (if the Common Stock is then listed as a National Market Issue under the\nNASD National Market System) or (B) the mean between the closing representative\nbid and asked prices (in all other cases) for the Common Stock on the day\nprevious to such date as reported by NASDAQ or such successor quotation system;\nor (iii) if such Common Stock is not publicly traded on an exchange and not\nquoted on NASDAQ or a successor quotation system, the mean between the closing\nbid and asked prices for the Common Stock, on the day previous to such date, as\ndetermined in good faith by the Committee; or (iv) if the Common Stock is not\npublicly traded, the fair market value established by the Committee acting in\ngood faith and taking account of factors applicable to such shares such as their\nstatus as minority or non-controlling shares and any restrictions on the shares\ncontained in this Plan or the Stockholders Agreement.\n\nSection 4.4.      Expiration of Options\n------------      ---------------------\n\n         (a) No Option may be exercised to any extent by the Optionee or his or\nher Eligible Representative after the first to occur of the following events:\n\n                  (i)   The expiration of ten years from the date the Option was\n         granted; or\n\n\n                                       7\n\n\n\n\n\n                  (ii)  With respect to an Incentive Stock Option in the case of\n         an Optionee owning (within the meaning of Section 424(d) of the Code),\n         at the time the Incentive Stock Option was granted, more than 10% of\n         the total combined voting power of all classes of stock of the Company\n         or any subsidiary corporation, the expiration of five years from the\n         date the Incentive Stock Option was granted; or\n\n                  (iii) Except as the Committee (or the Board, in the case of\n         Options granted to Independent Directors) may provide in the terms of\n         the applicable Stock Option Agreement or otherwise approve, for any\n         reason other than death or disability (as defined in Section 22(e)(3)\n         of the Code); or\n\n                  (iv)  In the case of an Optionee whose Termination of\n         Employment is by reason of his or her disability (within the meaning of\n         Section 22(e)(3) of the Code), the expiration of 12 months from the\n         date of the Optionee's Termination of Employment unless the Optionee\n         dies within said 12 month period, in which case the Option shall cease\n         to be exercisable upon the expiration of 180 days from the date of the\n         Optionee's death; or\n\n                  (v)   The expiration of 180 days from the date of the\n         Optionee's death.\n\n                                   ARTICLE V.\n\n                               EXERCISE OF OPTIONS\n                               -------------------\n\nSection 5.1.      Person Eligible to Exercise\n------------      ---------------------------\n\n         During the lifetime of the Optionee, only he or she may exercise an\nOption (or any portion thereof) granted to him or her; provided, however, that\nthe Optionee's Eligible Representative may exercise the Optionee's Option during\nthe period of the Optionee's disability (as defined in Section 22(e)(3) of the\nCode) notwithstanding that an Option so exercised will not qualify as an\nIncentive Stock Option. After the death of the Optionee, any exercisable portion\nof an Option may, prior to the time when such portion becomes unexercisable\nunder the Plan or the applicable Stock Option Agreement, be exercised by the\nOptionee's Eligible Representative.\n\nSection 5.2.      Partial Exercise\n------------      ----------------\n\n         At any time and from time to time prior to the time when any\nexercisable Option or exercisable portion thereof becomes unexercisable under\nthe Plan or the applicable Stock Option Agreement, such Option or portion\nthereof may be exercised in whole or in part; provided, however, that the\nCompany shall not be required to issue fractional shares and the Committee (or\nthe Board, in the case of Options granted to Independent Directors) may, by the\nterms of the Option, require any partial exercise to be with respect to a\nspecified minimum number of shares.\n\nSection 5.3.      Manner of Exercise\n------------      ------------------\n\n         An exercisable Option, or any exercisable portion thereof, may be\nexercised solely by delivery to the Secretary of all of the following prior to\nthe time when such Option or such portion becomes unexercisable under the Plan\nor the applicable Stock Option Agreement:\n\n\n                                       8\n\n\n\n\n\n         (a) Notice in writing signed by the Optionee or his or her Eligible\nRepresentative, stating that such Option or portion is exercised, and\nspecifically stating the number of shares with respect to which the Option is\nbeing exercised;\n\n         (b) A copy of the Stockholders Agreement signed by the Optionee or\nEligible Representative, as applicable;\n\n         (c) (i)   Full payment (in cash or by personal, certified or bank\n         cashier check) for the shares with respect to which such Option or\n         portion is thereby exercised; or\n\n             (ii)  With the consent of the Committee (or the Board, in the case\n         of Options granted to Independent Directors), (A) shares of Common\n         Stock owned by the Optionee duly endorsed for transfer to the Company\n         or (B) except with respect to Incentive Stock Options, shares of the\n         Common Stock issuable to the Optionee upon exercise of the Option, with\n         a fair market value (as determined under Section 4.3(b)) on the date of\n         Option exercise equal to the aggregate Option price of the shares with\n         respect to which such Option or portion is thereby exercised; or\n\n             (iii) With the consent of the Committee (or the Board, in the case\n         of Options granted to Independent Directors), any combination of the\n         consideration provided in the foregoing subsections (i) and (ii);\n\n         (d) The payment to the Company of all amounts necessary to satisfy any\nand all federal, state and local tax withholding requirements arising in\nconnection with the exercise of the Option;\n\n         (e) Such representations and documents as the Committee (or the Board,\nin the case of Options granted to Independent Directors) deems necessary or\nadvisable to effect compliance with all applicable provisions of the Securities\nAct and any other federal or state securities laws or regulations. The Committee\n(or the Board, in the case of Options granted to Independent Directors) may, in\nits sole discretion, also take whatever additional actions it deems appropriate\nto effect such compliance including, without limitation, placing legends on\nshare certificates and issuing stop-transfer orders to transfer agents and\nregistrars; and\n\n         (f) In the event that the Option or portion thereof shall be exercised\npursuant to Section 5.1 by any person or persons other than the Optionee,\nappropriate proof of the right of such person or persons to exercise the Option\nor portion thereof.\n\nSection 5.4.      Conditions to Issuance of Stock Certificates\n------------      --------------------------------------------\n\n         The shares of stock issuable and deliverable upon the exercise of an\nOption, or any portion thereof, may be either previously authorized but unissued\nshares or issued shares which have then been reacquired by the Company. A\ncertificate of shares will be delivered to the Optionee at the Company's\nprincipal place of business within ten days of receipt by the Company of the\nwritten notice and payment, unless an earlier date is agreed upon or required by\nlaw or other ruling or regulation. Notwithstanding the above, the Company shall\nnot be required to issue or deliver any certificate or certificates for shares\nof stock purchased upon the exercise of any Option or portion thereof prior to\nfulfillment of all of the following conditions:\n\n\n                                       9\n\n\n\n\n\n         (a) The admission of such shares to listing on any and all stock\nexchanges on which such class of stock is then listed;\n\n         (b) The completion of any registration or other qualification of such\nshares under any state or federal law or under the rulings or regulations of the\nSecurities and Exchange Commission or any other governmental regulatory body,\nwhich the Committee (or the Board, in the case of Options granted to Independent\nDirectors) shall, in its sole discretion, deem necessary or advisable;\n\n         (c) The obtaining of any approval or other clearance from any state or\nfederal governmental agency which the Committee (or the Board, in the case of\nOptions granted to Independent Directors) shall, in its sole discretion,\ndetermine to be necessary or advisable; and\n\n         (d) The payment to the Company of all amounts which it is required to\nwithhold under federal, state or local law in connection with the exercise of\nthe Option.\n\nSection 5.5.      Rights as Stockholders\n------------      ----------------------\n\n         The holder of an Option shall not be, nor have any of the rights or\nprivileges of, a stockholder of the Company in respect of any shares purchasable\nupon the exercise of any part of an Option unless and until such holder has\nsigned a Stockholders Agreement and certificates representing such shares have\nbeen issued by the Company to such holder.\n\nSection 5.6.      Transfer Restrictions\n------------      ---------------------\n\n         Shares acquired upon exercise of an Option shall be subject to the\nterms and conditions of a Stockholders Agreement. In addition, the Committee (or\nthe Board, in the case of Options granted to Independent Directors), in its sole\ndiscretion, may impose further restrictions on the transferability of the shares\npurchasable upon the exercise of an Option as it deems appropriate. Any such\nrestriction shall be set forth in the respective Stock Option Agreement and may\nbe referred to on the certificates evidencing such shares. The Committee may\nrequire the Employee to give the Company prompt notice of any disposition of\nshares of stock acquired by exercise of an Incentive Stock Option within two\nyears from the date of granting such Option or one year after the transfer of\nsuch shares to such Employee. The Committee may direct that the certificates\nevidencing shares acquired by exercise of an Option refer to such requirement.\n\n                                   ARTICLE VI.\n\n                                 ADMINISTRATION\n                                 --------------\n\nSection 6.1.      Committee\n------------      ---------\n\n         The Committee shall consist of two or more Directors, appointed by and\nholding office at the pleasure of the Board. Appointment of Committee members\nshall be effective upon acceptance of appointment. Committee members may resign\nat any time by delivering written notice to the Board. Vacancies in the\nCommittee shall be filled by the Board.\n\nSection 6.2.      Delegation by Committee\n------------      -----------------------\n\n\n                                       10\n\n\n\n\n\n         The Committee may delegate to the CEO any of its rights, powers and\nduties under the Plan (except those granted pursuant to Sections 3.3, 4.3,\n5.3(c) and (e), 5.6 and Article VII).\n\nSection 6.3.      Duties and Powers of CEO and the Committee\n------------      ------------------------------------------\n\n         It shall be the duty of the Committee (and\/or the CEO, as applicable)\nto conduct the general administration of the Plan in accordance with its\nprovisions. Except with respect to Options granted to Independent Directors, the\nCommittee shall have the authority to grant Options and to specify the terms and\nconditions, including, without limitation, performance targets, of Options in\naccordance with the Plan. The Committee (and\/or the CEO, as applicable) shall\nalso have the power to interpret the Plan and the Options and to adopt such\nrules for the administration, interpretation and application of the Plan as are\nconsistent therewith and to interpret, amend or revoke any such rules.\nNotwithstanding the foregoing, the full Board, acting by a majority of its\nmembers in office, shall conduct the general administration of the Plan with\nrespect to Options granted to Independent Directors. Any such interpretations\nand rules in regard to Incentive Stock Options shall be consistent with the\nterms and conditions applicable to 'incentive stock options' within the meaning\nof Section 422 of the Code. All determinations and decisions made by the\nCommittee (and\/or the CEO, as applicable) under any provision of the Plan or of\nany Option granted thereunder shall be final, conclusive and binding on all\npersons.\n\nSection 6.4.      Compensation; Professional Assistance; Good Faith Actions\n------------      ---------------------------------------------------------\n\n         The members of the Committee shall receive such compensation for their\nservices hereunder as may be determined by the Board. All expenses and\nliabilities incurred by the members of the Committee or the Board in connection\nwith the administration of the Plan shall be borne by the Company. The Committee\nor the Board may employ attorneys, consultants, accountants, appraisers, brokers\nor other persons. The Committee, the Company and its Officers and Directors\nshall be entitled to rely upon the advice, opinions or valuations of any such\npersons. All actions taken and all interpretations and determinations made by\nthe CEO, the Committee and the Board in good faith shall be final and binding\nupon all Optionees, the Company and all other interested persons. No member of\nthe Board shall be personally liable for any action, determination or\ninterpretation made in good faith with respect to the Plan or the Options, and\nall members of the Board shall be fully protected by the Company in respect to\nany such action, determination or interpretation.\n\n                                  ARTICLE VII.\n\n                                OTHER PROVISIONS\n                                ----------------\n\nSection 7.1.      Changes in Common Stock or Assets of the Company,  Acquisition\n                  or Liquidation of the Company and Other Corporate Events.\n------------      ---------------------------------------------------------\n\n         (a) Subject to Section 7.1(d) and the terms of outstanding Options, in\nthe event that the Committee (or the Board, in the case of Options granted to\nIndependent Directors) determines, in its sole discretion, that any dividend or\nother distribution (whether in the form of cash, Common Stock, other securities,\nor other property), recapitalization, reclassification, stock split, reverse\nstock split, reorganization, merger, consolidation, split-up, spin-off,\ncombination, repurchase, liquidation, dissolution, or sale, transfer, exchange\nor other disposition of all or substantially all of the assets of the Company,\nor exchange of Common Stock or other securities\n\n\n                                       11\n\n\n\n\n\nof the Company, issuance of warrants or other rights to purchase Common Stock or\nother securities of the Company, public offering of Common Stock, or other\nsimilar corporate transaction or event (each such transaction or event being\nreferred to herein as a 'Corporate Event'), affects the Common Stock such that\nan adjustment is determined by the Committee (or the Board, in the case of\nOptions granted to Independent Directors) to be appropriate in order to prevent\ndilution, reduction or enlargement of the benefits or potential benefits\nintended to be made available under the Plan or with respect to an Option, then\nthe Committee (or the Board, in the case of Options granted to Independent\nDirectors) shall, in good faith and in such manner as it may deem equitable in\norder to prevent such dilution, reduction or enlargement, adjust any or all of\n\n                  (i)   The number and kind of shares of Common Stock (or other\n         securities or property) with respect to which Options may be granted\n         under the Plan (including, but not limited to, adjustments of the\n         limitations in Section 2.1 on the maximum number and kind of shares\n         which may be issued);\n\n                  (ii)  The number and kind of shares of Common Stock (or other\n         securities or property) subject to outstanding Options;\n\n                  (iii) The exercise price with respect to any Option; and\n\n                  (iv)  The financial or other 'targets' specified in each Stock\n         Option Agreement for determining the exercisability of Options.\n\n         (b) Subject to Section 7.1(d) and the terms of outstanding Options,\nupon the occurrence of any Corporate Event or any unusual or nonrecurring\ntransaction or event affecting the Company or any Affiliate of the Company or\nthe financial statements of the Company or any Affiliate, or changes in\napplicable laws, regulations, or accounting principles, the Committee (or the\nBoard, in the case of Options granted to Independent Directors), in its sole\ndiscretion, is hereby authorized to take any one or more of the following\nactions, either by the terms of the applicable Stock Option Agreement or by\naction taken prior to the occurrence of such event, whenever the Committee (or\nthe Board, in the case of Options granted to Independent Directors) determines,\nin good faith, that such action is appropriate in order to prevent dilution or\nenlargement of the benefits or potential benefits intended to be made available\nunder the Plan or with respect to any Option under this Plan, to facilitate such\nevent or to give effect to such changes in laws, regulations or principles:\n\n                  (i) provide, either automatically or upon the Optionee's\n         request, that on or following the effective time of such event the\n         Option shall be exercisable only for (A) the aggregate consideration\n         (whether in the form of cash or otherwise) into which shares of Common\n         Stock issuable upon the exercise of such Option would have been\n         converted (or for which such shares would have been exercisable) if\n         such Option had been exercised immediately prior to the event, or (B)\n         the amount of cash equal to the value of the consideration described in\n         (A);\n\n                  (ii) provide, either automatically or upon the Optionee's\n         request, for the replacement of such Option with other rights or\n         property selected by the Committee (or the Board, in the case of\n         Options granted to Independent Directors) in its sole discretion;\n\n\n                                       12\n\n\n\n\n\n                  (iii) provide, that the Option cannot be exercised after such\n         event;\n\n                  (iv)  provide that for a specified period of time prior to\n         such event, such Option shall be exercisable as to all shares covered\n         thereby, notwithstanding anything to the contrary in (A) Section 4.2 or\n         (B) the provisions of the applicable Stock Option Agreement;\n\n                  (v)   provide that upon such event such Option be assumed by\n         the successor or survivor corporation, or a parent or subsidiary\n         thereof, or shall be substituted for by similar options, rights or\n         awards covering the stock of the successor or survivor corporation, or\n         a parent or subsidiary thereof, with appropriate adjustments as to the\n         number and kind of shares and prices; and\n\n                  (vi)  make adjustments in the number and type of shares of\n         Common Stock (or other securities or property) subject to outstanding\n         Options and\/or in the terms and conditions of (including the exercise\n         price), and the criteria included in, outstanding Options and Options\n         which may be granted in the future.\n\n         (c) Subject to Sections 7.1(d), the Committee (or the Board, in the\ncase of Options granted to Independent Directors) may, in its sole discretion,\ninclude such further provisions and limitations in any Stock Option Agreement as\nit may deem equitable and in the best interests of the Company and its\nAffiliates.\n\n         (d) With respect to Incentive Stock Options, no adjustment or action\ndescribed in this Section 7.1 or in any other provision of the Plan shall be\nauthorized to the extent that such adjustment or action would cause the Plan to\nviolate Section 422(b)(1) of the Code or any successor provisions thereto,\nunless the Committee determines that the Plan and\/or the Options are not to\ncomply with Section 422(b)(1) of the Code. The number of shares of Common Stock\nsubject to any Option shall always be rounded up to the next higher whole\nnumber.\n\nSection 7.2.      Options Not Transferable\n------------      ------------------------\n\n         No Option or interest or right therein or part thereof shall be liable\nfor the debts, contracts or engagements of the Optionee or his or her successors\nin interest or shall be subject to disposition by transfer, alienation,\nanticipation, pledge, encumbrance, assignment or any other means whether such\ndisposition be voluntary or involuntary or by operation of law, by judgment,\nlevy, attachment, garnishment or any other legal or equitable proceedings\n(including bankruptcy), and any attempted disposition thereof shall be null and\nvoid and of no effect; provided, however, that nothing in this Section 7.2 shall\nprevent transfers by will or by the applicable laws of descent and distribution.\n\nSection 7.3.      Amendment, Suspension or Termination of the Plan\n------------      ------------------------------------------------\n\n         The Plan may be wholly or partially amended or otherwise modified,\nsuspended or terminated at any time or from time to time by the Board or the\nCommittee. However, without the approval of stockholders given within twelve\nmonths before or after such action, no action of the Board or the Committee may,\nexcept as provided in Section 7.1, change the class of employees eligible to\nreceive options under the Plan, increase any limit imposed in Section 2.1 on the\nmaximum number of shares which may be issued on exercise of Options, reduce the\nminimum Option price requirements of Section 4.3(a), or extend the limit\n\n\n\n                                       13\n\n\n\n\n\nimposed in this Section 7.3 on the period during which options may be granted.\nExcept as provided by Section 7.1, neither the amendment, suspension nor\ntermination of the Plan shall, without the consent of the holder of the Option,\nalter or impair any rights or obligations under any Option theretofore granted.\nNo Option may be granted during any period of suspension nor after termination\nof the Plan, and in no event may any Option be granted under this Plan after the\nexpiration of ten years from the date the Plan is adopted by the Board.\n\nSection 7.4.      Effect of Plan Upon Other Option and Compensation Plans\n------------      -------------------------------------------------------\n\n         The adoption of this Plan shall not affect any other compensation or\nincentive plans in effect for the Company or any Affiliate. Nothing in this Plan\nshall be construed to limit the right of the Company or any Affiliate (a) to\nestablish any other forms of incentives or compensation for directors or\nemployees of the Company (or any Affiliate) or (b) to grant or assume options\notherwise than under this Plan in connection with any proper corporate purpose,\nincluding, but not by way of limitation, the grant or assumption of options in\nconnection with the acquisition by purchase, lease, merger, consolidation or\notherwise, of the business, stock or assets of any corporation, firm or\nassociation.\n\nSection 7.5.      Approval of Plan by Stockholders\n------------      --------------------------------\n\n         This Plan will be submitted for the approval of the Company's\nstockholders within twelve months after the date of the Board's initial adoption\nof this Plan and the Plan and the Options granted hereunder shall be effective\nupon approval by such stockholders as provided in Section 280G(b)(5)(A)(ii) of\nthe Code and regulations thereunder. No Option may be exercised to any extent by\nanyone unless and until the Plan is so approved by the stockholders, and if such\napproval has not been obtained by the end of said twelve-month period, the Plan\nand all Options theretofore granted shall thereupon be canceled and become null\nand void.\n\nSection 7.6.      Titles\n------------      ------\n\n         Titles are provided herein for convenience only and are not to serve as\na basis for interpretation or construction of the Plan.\n\nSection 7.7.      Conformity to Securities Laws\n------------      -----------------------------\n\n         The Plan is intended to conform to the extent necessary with all\nprovisions of the Securities Act and the Exchange Act and any and all\nregulations and rules promulgated by the Securities and Exchange Commission\nthereunder to the extent the Company and its employees are subject to the\nprovisions thereof. Notwithstanding anything herein to the contrary, the Plan\nshall be administered, and Options shall be granted and may be exercised, only\nin such a manner as to conform to such laws, rules and regulations. To the\nextent permitted by applicable law, the Plan and Options granted hereunder shall\nbe deemed amended to the extent necessary to conform to such laws, rules and\nregulations.\n\nSection 7.8.      Governing Law\n------------      -------------\n\n         To the extent not preempted by federal law, the Plan shall be construed\nin accordance with and governed by the laws of the State of Delaware.\n\n\n                                       14\n\n\n\n\n\nSection 7.9.      Severability\n------------      ------------\n\n         In the event any portion of the Plan or any action taken pursuant\nthereto shall be held illegal or invalid for any reason, the illegality or\ninvalidity shall not affect the remaining parts of the Plan, and the Plan shall\nbe construed and enforced as if the illegal or invalid provisions had not been\nincluded, and the illegal or invalid action shall be null and void.\n\n                                    * * * *\n\n         I hereby certify that the foregoing Plan was duly adopted by the Board\nof Directors of United Defense Industries, Inc. on _______________ _____, 1998.\n\n                               Executed on this ____ day of ____________, 1998.\n\n\n\n                               -----------------------------\n                               Secretary\n\n\n                                       15\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9167],"corporate_contracts_industries":[9477],"corporate_contracts_types":[9539,9545],"class_list":["post-40633","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-united-defense-industries-inc","corporate_contracts_industries-aerospace__vehicles","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\/40633","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=40633"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40633"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40633"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}