OTHER
MATTERS
The
Board of Directors knows of no other business which will be presented at the Annual Meeting. If any other matters properly come
before the meeting, the persons named in the enclosed Proxy, or their substitutes, will vote the shares represented thereby in
accordance with their judgment on such matters.
ADDITIONAL
INFORMATION
Proxy
Solicitation Costs
The
proxies being solicited hereby are being solicited by the Company. The Company will bear the entire cost of solicitation of proxies,
including preparation, assembly, printing and mailing of the Notice, the Proxy Statement, the Proxy Card. Copies of solicitation
materials will be furnished to banks, brokerage houses, fiduciaries and custodians holding in their names shares of common stock
beneficially owned by others to forward to such beneficial owners. Officers and regular employees of the Company may, but without
compensation other than their regular compensation, solicit proxies by further mailing facsimile or electronic means. We will,
upon request, reimburse brokerage firms and others for their reasonable expenses in forwarding solicitation material to the beneficial
owners of stock.
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By
Order of the Board of Directors,
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/s/
Eliyahu Walles
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Eliyahu
Walles
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Chairman
of the Board of Directors
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Exhibit
A
Form of
AMENDED
AND RESTATED CERTIFICATE OF INCORPORATION
OF
My
Size, Inc.
My
Size, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware (the “Corporation”),
does hereby certify:
1.
The name of the Corporation is My Size, Inc. The Corporation was organized under the name “Topskin Medical, Inc.”
on September 20, 1999.
2.
The Certificate of Incorporation of the Corporation is hereby amended and restated to read as follows:
FIRST:
The name of the Corporation is My Size, Inc. (the “Corporation”).
SECOND:
The address of its registered office in the State of Delaware is 2711 Centerville Road, Suite 400, in the City of Wilmington,
County of New Castle. The name of its registered agent at such address is Corporation Service Company.
THIRD:
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General
Corporation Law of Delaware.
FOURTH:
The Corporation is to have perpetual existence.
FIFTH:
The total number of shares of stock which the Corporation shall have authority to issue is fifty million 50,000,000 shares of
common stock with a par value of $0.001 per share.
SIXTH:
The Board of Directors shall have the power to adopt, amend or repeal the by-laws of the Corporation.
SEVENTH:
No director shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary
duty by such director as a director. Notwithstanding the foregoing sentence, a director shall be liable to the extent provided
by applicable law, (i) for breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section
174 of the General Corporation Law or (iv) for any transaction from which the director derived an improper personal benefit. If
the General Corporation Law hereafter is amended to authorize the further elimination or limitation of the liability of directors,
then the liability of a director of the Corporation, in addition to the limitation on personal liability provided herein, shall
be limited to the fullest extent permitted by the amended General Corporation Law. No amendment to or repeal of this Article SEVENTH
shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect
to any acts or omissions of such director occurring prior to such amendment.
EIGHTH:
The Corporation shall indemnify, to the fullest extent permitted by Section 145 of the General Corporation Law, as amended from
time to time, each person that such section grants the Corporation the power to indemnify.
NINTH:
Whenever a compromise or arrangement is proposed between this corporation and its creditors or any class of them and/or between
this corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may,
on the application in a summary way of this corporation or of any creditor or stockholder thereof or on the application of any
receiver or receivers appointed for this corporation under the provisions of Section 291 of Title 8 of the Delaware Code or on
the application of trustees in dissolution or of any receiver or receivers appointed for this corporation under the provisions
of Section 279 of Title 8 of the Delaware Code order a meeting of the creditors or class of creditors, and/or of the stockholders
or class of stockholders of this corporation, as the case may be, to be summoned in such manner as the said court directs. If
a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders or
class of stockholders of this corporation, as the case may be, agree to any compromise or arrangement and to any reorganization
of this corporation as consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization
shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors,
and/or on all the stockholders or class of stockholders, of this corporation, as the case may be, and also on this corporation.
TENTH:
Election of directors need not be by written ballot unless the by-laws of the corporation shall so provide.
This
Restated Certificate of Incorporation has been duly adopted in accordance with the provisions of Sections 242 and 245 of the General
Corporation Law of Delaware.
IN
WITNESS WHEREOF, the Corporation has caused this Certificate to be signed by its chief executive officer this __ day of _______,
2017.
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By:
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Ronen
Luzon
Chief
Executive Officer
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Exhibit
B
My
Size, Inc.
2017
Equity Incentive Plan
MY SIZE, INC.
2017 EQUITY INCENTIVE PLAN
1.
Purpose
. The purpose of the My Size, Inc.
2017 Equity Incentive Plan is to provide a means through which the Company and its Affiliates may attract and retain key personnel
and to provide a means whereby directors, officers, managers and employees of the Company and its Affiliates can acquire and maintain
an equity interest in the Company, or be paid incentive compensation, which may (but need not) be measured by reference to the
value of Common Shares, thereby strengthening their commitment to the welfare of the Company and its Affiliates and aligning their
interests with those of the Company’s stockholders.
2.
Definitions
. The following definitions shall
be applicable throughout this Plan:
(a) “
Affiliate
” means (i) any
person or entity that directly or indirectly controls, is controlled by or is under common control with the Company and/or (ii) to
the extent provided by the Committee, any person or entity in which the Company has a significant interest as determined by the
Committee in its discretion. The term “control” (including, with correlative meaning, the terms “controlled by”
and “under common control with”), as applied to any person or entity, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership
of voting or other securities, by contract or otherwise.
(b) “
Award
” means, individually
or collectively, any Incentive Stock Option, Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, Restricted
Stock Unit, Stock Bonus Award or Performance Compensation Award granted under this Plan.
(c) “
Award Agreement
” means
an agreement made and delivered in accordance with Section 15(a) of this Plan evidencing the grant of an Award hereunder.
(d) “
Board
” means the Board
of Directors of the Company.
(e)
“
Business Day
”
means
any day other than a Saturday, a Sunday or a day on which banking institutions in New York City are authorized or obligated by
federal law or executive order to be closed.
(f) “
Cause
” means, in the
case of a particular Award, unless the applicable Award Agreement states otherwise, (i) the Company or an Affiliate having
“cause” to terminate a Participant’s employment or service, as defined in any employment or consulting agreement
or similar document or policy between the Participant and the Company or an Affiliate in effect at the time of such termination
or (ii) in the absence of any such employment or consulting agreement, document or policy (or the absence of any definition
of “Cause” contained therein), (A) a continuing material breach or material default (including, without limitation,
any material dereliction of duty) by Participant of any agreement between the Participant and the Company, except for any such
breach or default which is caused by the physical disability of the Participant (as determined by a neutral physician), or a continuing
failure by the Participant to follow the direction of a duly authorized representative of the Company; (B) gross negligence,
willful misfeasance or breach of fiduciary duty to the Company or Affiliate of the Company by the Participant; (C) the commission
by the Participant of an act of fraud, embezzlement or any felony or other crime of dishonesty in connection with the Participant’s
duties to the Company or Affiliate of the Company; or (D) conviction of the Participant of a felony or any other crime that
would materially and adversely affect: (i) the business reputation of the Company or Affiliate of the Company or (ii) the
performance of the Participant’s duties to the Company or an Affiliate of the Company. Any determination of whether Cause
exists shall be made by the Committee in its sole discretion.
(g) “
Change in Control
” shall,
in the case of a particular Award, unless the applicable Award Agreement states otherwise or contains a different definition of
“Change in Control,” be deemed to occur upon:
(i) A tender offer (or series of related offers) shall
be made and consummated for the ownership of 50% or more of the outstanding voting securities of the Company, unless as a result
of such tender offer more than 50% of the outstanding voting securities of the surviving or resulting corporation or entity shall
be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to the commencement of
such offer), or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
(ii) The Company shall be merged or consolidated with
another corporation, unless as a result of such merger or consolidation more than 50% of the outstanding voting securities of the
surviving or resulting corporation or entity shall be owned in the aggregate by (A) the shareholders of the Company (as of
the time immediately prior to such transaction); provided, that a merger or consolidation of the Company with another company which
is controlled by persons owning more than 50% of the outstanding voting securities of the Company shall constitute a Change in
Control unless the Committee, in its discretion, determine otherwise, or (B) any employee benefit plan of the Company or its
Subsidiaries, and their Affiliates;
(iii) The Company shall sell substantially all of its
assets to another entity that is not wholly owned by the Company, unless as a result of such sale more than 50% of such assets
shall be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to such transaction),
or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
(iv) A Person (as defined below) shall acquire 50%
or more of the outstanding voting securities of the Company (whether directly, indirectly, beneficially or of record), unless as
a result of such acquisition more than 50% of the outstanding voting securities of the surviving or resulting corporation or entity
shall be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to the first acquisition
of such securities by such Person), or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
or
(v) The individuals who, as of the date hereof, constitute
the members of the Board (the “Current Board Members”) cease, by reason of a financing, merger, combination, acquisition,
takeover or other non-ordinary course transaction affecting the Company, to constitute at least a majority of the members of the
Board unless such change is approved by the Current Board Members.
For purposes of this Section 2(g), ownership of
voting securities shall take into account and shall include ownership as determined by applying the provisions of Rule 13d-3(d)(I)(i)
(as in effect on the date hereof) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition,
for such purposes, “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and
used in Sections 13(d) and 14(d) thereof; however, a Person shall not include
(A) the Company or any of its Subsidiaries; (B) a
trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries; (C) an
underwriter temporarily holding securities pursuant to an offering of such securities; or (D) a corporation owned, directly
or indirectly, by the shareholders of the Company in substantially the same proportion as their ownership of stock of the Company.
(h) “
Code
” means the Internal
Revenue Code of 1986, as amended, and any successor thereto. References in this Plan to any section of the Code shall be deemed
to include any regulations or other interpretative guidance issued by any governmental authority under such section, and any amendments
or successor provisions to such section, regulations or guidance.
(i) “
Committee
” means a committee
of at least two people as the Board may appoint to administer this Plan or, if no such committee has been appointed by the Board,
the Board. Unless altered by an action of the Board, the Committee shall be the Compensation Committee of the Board.
(j) “
Common Shares
” means
the common stock, par value $0.0001 per share, of the Company (and any stock or other securities into which such common shares
may be converted or into which they may be exchanged).
(k) “
Company
” means My Size,
Inc., a Delaware corporation, together with its successors and assigns.
(l) “
Current Board Members
”
has the meaning given such term in the definition of “Change in Control.”
(m) “
Date of Grant
” means
the date on which the granting of an Award is authorized, or such other date as may be specified in such authorization.
(n) “
Disability
” means a
“permanent and total” disability incurred by a Participant while in the employ or service of the Company or an Affiliate.
For this purpose, a permanent and total disability shall mean that the Participant is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than twelve (12) months. The determination of whether a Participant has
incurred a permanent and total disability shall be made by a physician designated by the Committee, whose determination shall be
final and binding.
(o) “
Effective Date
” means
the date as of which this Plan is adopted by the Board, subject to Section 3 of this Plan.
(p) “
Eligible Director
” means
a person who is (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, and (ii) an
“outside director” within the meaning of Section 162(m) of the Code.
(q) “
Eligible Person
” means
any (i) individual employed by the Company or an Affiliate;
provided, however
, that no such employee covered by a
collective bargaining agreement shall be an Eligible Person unless and to the extent that such eligibility is set forth in such
collective bargaining agreement or in an agreement or instrument relating thereto; or (ii) director of the Company or an
Affiliate.
(r) “
Exchange Act
” has the
meaning given such term in the definition of “Change in Control,” and any reference in this Plan to any section of
(or rule promulgated under) the Exchange Act shall be deemed to include any rules, regulations or other interpretative guidance
issued by any governmental authority under such section or rule, and any amendments or successor provisions to such section, rules,
regulations or guidance.
(s) “
Exercise Price
” has
the meaning given such term in Section 7(b) of this Plan.
(t) “
Fair Market Value
”,
unless otherwise provided by the Committee in accordance with all applicable laws, rules regulations and standards, means, on a
given date, (i) if the Common Shares are listed on a national securities exchange, the closing sales price on the principal
exchange of the Common Shares on such date or, in the absence of reported sales on such date, the closing sales price on the immediately
preceding date on which sales were reported, or (ii) if the Common Shares are not listed on a national securities exchange,
the mean between the bid and offered prices as quoted by any nationally recognized interdealer quotation system for such date,
provided that if the Common Shares are not quoted on an interdealer quotation system or it is determined that the fair market value
is not properly reflected by such quotations, Fair Market Value will be determined by such other method as the Committee determines
in good faith to be reasonable and in compliance with Code Section 409A.
(u) “
Immediate Family Members
”
shall have the meaning set forth in Section 15(b) of this Plan.
(v) “
Incentive Stock Option
”
means an Option that is designated by the Committee as an incentive stock option as described in Section 422 of the Code and
otherwise meets the requirements set forth in this Plan.
(w) “
Indemnifiable Person
”
shall have the meaning set forth in Section 4(e) of this Plan.
(x) “
Negative Discretion
”
shall mean the discretion authorized by this Plan to be applied by the Committee to eliminate or reduce the size of a Performance
Compensation Award consistent with Section 162(m) of the Code.
(y) “
Nonqualified Stock Option
”
means an Option that is not designated by the Committee as an Incentive Stock Option.
(z) “
Option
” means an Award
granted under Section 7 of this Plan.
(aa) “
Option Period
” has
the meaning given such term in Section 7(c) of this Plan.
(bb) “
Participant
” means
an Eligible Person who has been selected by the Committee to participate in this Plan and to receive an Award pursuant to Section 6
of this Plan.
(cc) “
Performance Compensation Award
”
shall mean any Award designated by the Committee as a Performance Compensation Award pursuant to Section 11 of this Plan.
(dd) “
Performance Criteria
”
shall mean the criterion or criteria that the Committee shall select for purposes of establishing the Performance Goal(s) for a
Performance Period with respect to any Performance Compensation Award under this Plan.
(ee) “
Performance Formula
”
shall mean, for a Performance Period, the one or more objective formulae applied against the relevant Performance Goal to determine,
with regard to the Performance Compensation Award of a particular Participant, whether all, some portion but less than all, or
none of the Performance Compensation Award has been earned for the Performance Period.
(ff) “
Performance Goals
”
shall mean, for a Performance Period, the one or more goals established by the Committee for the Performance Period based upon
the Performance Criteria.
(gg) “
Performance Period
”
shall mean the one or more periods of time, as the Committee may select, over which the attainment of one or more Performance Goals
will be measured for the purpose of determining a Participant’s right to, and the payment of, a Performance Compensation
Award.
(hh) “
Permitted Transferee
”
shall have the meaning set forth in Section 15(b) of this Plan.
(ii) “
Person
” has the meaning
given such term in the definition of “Change in Control.”
(jj) “
Plan
” means this My
Size, Inc. 2017 Equity Incentive Plan, as amended from time to time.
(kk) “
Retirement
” means the
fulfillment of each of the following conditions: (i) the Participant is in good standing with the Company and/or an Affiliate
of the Company as determined by the Committee; (ii) the voluntary termination by a Participant of such Participant’s
employment or service to the Company and/or an Affiliate and (iii) that at the time of such voluntary termination, the sum
of: (A) the Participant’s age (calculated to the nearest month, with any resulting fraction of a year being calculated
as the number of months in the year divided by 12) and (B) the Participant’s years of employment or service with the
Company (calculated to the nearest month, with any resulting fraction of a year being calculated as the number of months in the
year divided by 12) equals at least 62 (provided that, in any case, the foregoing shall only be applicable if, at the time of such
Retirement, the Participant shall be at least 55 years of age and shall have been employed by or served with the Company for no
less than five years).
(ll) “
Restricted Period
”
means the period of time determined by the Committee during which an Award is subject to restrictions or, as applicable, the period
of time within which performance is measured for purposes of determining whether an Award has been earned.
(mm) “
Restricted Stock Unit
”
means an unfunded and unsecured promise to deliver Common Shares, cash, other securities or other property, subject to certain
restrictions (including, without limitation, a requirement that the Participant remain continuously employed or provide continuous
services for a specified period of time), granted under Section 9 of this Plan.
(nn) “
Restricted Stock
” means
Common Shares, subject to certain specified restrictions (including, without limitation, a requirement that the Participant remain
continuously employed or provide continuous services for a specified period of time), granted under Section 9 of this Plan.
(oo) “
SAR Period
” has the
meaning given such term in Section 8(c) of this Plan.
(pp) “
Securities Act
” means
the Securities Act of 1933, as amended, and any successor thereto. Reference in this Plan to any section of the Securities Act
shall be deemed to include any rules, regulations or other official interpretative guidance issued by any governmental authority
under such section, and any amendments or successor provisions to such section, rules, regulations or guidance.
(qq) “
Stock Appreciation Right
”
or
“
SAR
”
means an Award granted under Section 8 of this Plan which meets all of the requirements
of Section 1.409A-1(b)(5)(i)(B) of the Treasury Regulations.
(rr) “
Stock Bonus Award
”
means an Award granted under Section 10 of this Plan.
(ss) “
Strike Price
” means,
except as otherwise provided by the Committee in the case of Substitute Awards, (i) in the case of a SAR granted in tandem
with an Option, the Exercise Price of the related Option, or (ii) in the case of a SAR granted independent of an Option, the
Fair Market Value of Common Shares on the Date of Grant.
(tt) “
Subsidiary
” means,
with respect to any specified Person:
(i) any corporation, association or other business
entity of which more than 50% of the total voting power of shares of voting securities (without regard to the occurrence of any
contingency and after giving effect to any voting agreement or stockholders’ agreement that effectively transfers voting
power) is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and
(ii) any partnership or limited liability company (or
any comparable foreign entity) (a) the sole general partner or managing member (or functional equivalent thereof) or the managing
general partner of which is such Person or Subsidiary of such Person or (b) the only general partners or managing members
(or functional equivalents thereof) of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).
(uu) “
Substitute Award
” has
the meaning given such term in Section 5(e).
(vv) “
Treasury Regulations
”
means any regulations, whether proposed, temporary or final, promulgated by the U.S. Department of Treasury under the Code, and
any successor provisions.
3.
Effective Date; Duration
. The Plan shall
be effective on ,
2017, the date on which it is approved by the stockholders of the Company, which date shall be within twelve (12) months
before or after the date of the Plan’s adoption by the Board. The expiration date of this Plan, on and after which date
no Awards may be granted hereunder, shall be ,
2027, the tenth anniversary of the date on which the Plan was approved by the stockholders of the Company;
provided, however
,
that such expiration shall not affect Awards then outstanding, and the terms and conditions of this Plan shall continue to apply
to such Awards.
4.
Administration.
(a) The Committee shall administer this Plan. To the
extent required to comply with the provisions of Rule 16b-3 promulgated under the Exchange Act (if the Board is not acting as the
Committee under this Plan) or necessary to obtain the exception for performance-based compensation under Section 162(m) of
the Code, as applicable, it is intended that each member of the Committee shall, at the time he takes any action with respect to
an Award under this Plan, be an Eligible Director. However, the fact that a Committee member shall fail to qualify as an Eligible
Director shall not invalidate any Award granted by the Committee that is otherwise validly granted under this Plan. The acts of
a majority of the members present at any meeting at which a quorum is present or acts approved in writing by a majority of the
Committee shall be deemed the acts of the Committee. Whether a quorum is present shall be determined based on the Committee’s
charter as approved by the Board.
(b) Subject to the provisions of this Plan and applicable
law, the Committee shall have the sole and plenary authority, in addition to other express powers and authorizations conferred
on the Committee by this Plan and its charter, to: (i) designate Participants; (ii) determine the type or types of Awards
to be granted to a Participant; (iii) determine the number of Common Shares to be covered by, or with respect to which payments,
rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions of any Award;
(v) determine whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, Common Shares,
other securities, other Awards or other property, or canceled, forfeited, or suspended, and the method or methods by which Awards
may be settled, exercised, canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what circumstances
the delivery of cash, Common Shares, other securities, other Awards or other property and other amounts payable with respect to
an Award shall be made; (vii) interpret, administer, reconcile any inconsistency in, settle any controversy regarding, correct
any defect in and/or complete any omission in this Plan and any instrument or agreement relating to, or Award granted under, this
Plan; (viii) establish, amend, suspend, or waive any rules and regulations and appoint such agents as the Committee shall
deem appropriate for the proper administration of this Plan; (ix) accelerate the vesting or exercisability of, payment for
or lapse of restrictions on, Awards; (x) to reprice existing Awards or to grant Awards in connection with or in consideration
of the cancellation of an outstanding Award with a higher price; and (xi) make any other determination and take any other
action that the Committee deems necessary or desirable for the administration of this Plan.
(c) The Committee may, by resolution, expressly delegate
to a special committee, consisting of one or more directors who may but need not be officers of the Company, the authority, within
specified parameters as to the number and types of Awards, to (i) designate officers and/or employees of the Company or any
of its Affiliates to be recipients of Awards under this Plan, and (ii) to determine the number of such Awards to be received
by any such Participants; provided, however, that such delegation of duties and responsibilities may not be made with respect to
grants of Awards to persons (i) subject to Section 16 of the Exchange Act or (ii) who are, or who are reasonably
expected to be, “covered employees” for purposes of Section 162(m) of the Code. The acts of such delegates shall
be treated as acts of the Committee, and such delegates shall report regularly to the Board and the Committee regarding the delegated
duties and responsibilities and any Awards granted.
(d) Unless otherwise expressly provided in this Plan,
all designations, determinations, interpretations, and other decisions under or with respect to this Plan or any Award or any documents
evidencing Awards granted pursuant to this Plan shall be within the sole discretion of the Committee, may be made at any time and
shall be final, conclusive and binding upon all persons or entities, including, without limitation, the Company, any Affiliate,
any Participant, any holder or beneficiary of any Award, and any stockholder of the Company.
(e) No member of the Board, the Committee, delegate
of the Committee or any employee, advisor or agent of the Company or the Board or the Committee (each such person, an “
Indemnifiable
Person
”) shall be liable for any action taken or omitted to be taken or any determination made in good faith with
respect to this Plan or any Award hereunder. Each Indemnifiable Person shall be indemnified and held harmless by the Company against
and from (and the Company shall pay or reimburse on demand for) any loss, cost, liability, or expense (including court costs and
attorneys’ fees) that may be imposed upon or incurred by such Indemnifiable Person in connection with or resulting from any
action, suit or proceeding to which such Indemnifiable Person may be a party or in which such Indemnifiable Person may be involved
by reason of any action taken or omitted to be taken under this Plan or any Award Agreement and against and from any and all amounts
paid by such Indemnifiable Person with the Company’s approval, in settlement thereof, or paid by such Indemnifiable Person
in satisfaction of any judgment in any such action, suit or proceeding against such Indemnifiable Person,
provided
, that
the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and once the Company
gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company’s
choice. The foregoing right of indemnification shall not be available to an Indemnifiable Person to the extent that a final judgment
or other final adjudication (in either case not subject to further appeal) binding upon such Indemnifiable Person determines that
the acts or omissions of such Indemnifiable Person giving rise to the indemnification claim resulted from such Indemnifiable Person’s
bad faith, fraud or willful criminal act or omission or that such right of indemnification is otherwise prohibited by law or by
the Company’s Certificate of Incorporation or Bylaws. The foregoing right of indemnification shall not be exclusive of any
other rights of indemnification to which any such Indemnifiable Person may be entitled under the Company’s Certificate of
Incorporation or Bylaws, as a matter of law, or otherwise, or any other power that the Company may have to indemnify such Indemnifiable
Persons or hold them harmless.
(f) Notwithstanding anything to the contrary contained
in this Plan, the Board may, in its sole discretion, at any time and from time to time, grant Awards and administer this Plan with
respect to such Awards. In any such case, the Board shall have all the authority granted to the Committee under this Plan.
5.
Grant of Awards; Shares Subject to this Plan;
Limitations.
(a) The Committee may, from time to time, grant Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Stock Bonus Awards and/or Performance Compensation Awards
to one or more Eligible Persons.
(b) Subject to Section 12 of this Plan, the Committee
is authorized to deliver under this Plan an aggregate of 2,000,000 Common Shares.
(c) Common Shares underlying Awards under this Plan
that are forfeited, cancelled, expire unexercised, or are settled in cash shall be available again for Awards under this Plan at
the same ratio at which they were previously granted. Notwithstanding the foregoing, the following Common Shares shall not be available
again for Awards under the Plan: (i) shares tendered or held back upon the exercise of an Option or settlement of an Award
to cover the Exercise Price of an Award; (ii) shares that are used or withheld to satisfy tax withholding obligations of the
Participant; and (iii) shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement
of the SAR upon exercise thereof.
(d) Common Shares delivered by the Company in settlement
of Awards may be authorized and unissued shares, shares held in the treasury of the Company, shares purchased on the open market
or by private purchase, or any combination of the foregoing.
(e) Subject to compliance with Section 1.409A-3(f)
of the Treasury Regulations, Awards may, in the sole discretion of the Committee, be granted under this Plan in assumption of,
or in substitution for, outstanding awards previously granted by an entity acquired by the Company or with which the Company combines
(“
Substitute Awards
”). The number of Common Shares underlying any Substitute Awards shall be counted
against the aggregate number of Common Shares available for Awards under this Plan.
(f) Notwithstanding any provision in the Plan to the
contrary (but subject to adjustment as provided in Section 12), the Committee shall not grant to any one Eligible Person in
any one calendar year Awards (i) for more than 50% of the Available Shares in the aggregate or (ii) payable in cash in
an amount exceeding $10,000,000 in the aggregate.
6.
Eligibility
. Participation shall be limited
to Eligible Persons who have entered into an Award Agreement or who have received written notification from the Committee, or from
a person designated by the Committee, that they have been selected to participate in this Plan.
7.
Options.
(a)
Generally
. Each Option granted under
this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a
web site maintained by the Company or a third party under contract with the Company)). Each Option so granted shall be subject
to the conditions set forth in this Section 7, and to such other conditions not inconsistent with this Plan as may be reflected
in the applicable Award Agreement. All Options granted under this Plan shall be Nonqualified Stock Options unless the applicable
Award Agreement expressly states that the Option is intended to be an Incentive Stock Option. Notwithstanding any designation of
an Option, to the extent that the aggregate Fair Market Value of Common Shares with respect to which Options designated as Incentive
Stock Options are exercisable for the first time by any Participant during any calendar year (under all plans of the Company or
any Subsidiary) exceeds $100,000, such excess Options shall be treated as Nonqualified Stock Options. Incentive Stock Options shall
be granted only to Eligible Persons who are employees of the Company and its Affiliates, and no Incentive Stock Option shall be
granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the Code. No Option shall be treated
as an Incentive Stock Option unless this Plan has been approved by the stockholders of the Company in a manner intended to comply
with the stockholder approval requirements of Section 422(b)(1) of the Code, provided that any Option intended to be an Incentive
Stock Option shall not fail to be effective solely on account of a failure to obtain such approval, but rather such Option shall
be treated as a Nonqualified Stock Option unless and until such approval is obtained. In the case of an Incentive Stock Option,
the terms and conditions of such grant shall be subject to and comply with such rules as may be prescribed by Section 422
of the Code. If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) shall not qualify as
an Incentive Stock Option, then, to the extent of such nonqualification, such Option or portion thereof shall be regarded as a
Nonqualified Stock Option appropriately granted under this Plan.
(b)
Exercise Price
. The exercise price (“
Exercise
Price
”) per Common Share for each Option shall not be less than the par value per Common Share.
(c)
Vesting and Expiration
. Options shall
vest and become exercisable in such manner and on such date or dates determined by the Committee and as set forth in the applicable
Award Agreement, and shall expire after such period, not to exceed ten (10) years from the Date of Grant, as may be determined
by the Committee (the “
Option Period
”);
provided, however
, that the Option Period shall not exceed
five (5) years from the Date of Grant in the case of an Incentive Stock Option granted to a Participant who on the Date of
Grant owns shares representing more than 10% of the voting power of all classes of shares of the Company or any Affiliate;
and,
provided, further
, that notwithstanding any vesting dates set by the Committee, the Committee may, in its sole discretion,
accelerate the exercisability of any Option, which acceleration shall not affect the terms and conditions of such Option other
than with respect to exercisability. Unless otherwise provided by the Committee in an Award Agreement:
(i) an Option shall vest and become exercisable with
respect to 100% of the Common Shares subject to such Option on each anniversary of the Date of Grant;
(ii) the unvested portion of an Option shall expire
upon termination of employment or service of the Participant granted the Option, and the vested portion of such Option shall remain
exercisable for:
(A) one year following termination of employment or
service by reason of such Participant’s death or Disability (with the determination of Disability to be made by the Committee
on a case by case basis), but not later than the expiration of the Option Period;
(B) for directors, officers and employees of the Company
only, for ninety (90) days following termination of employment or service by reason of such Participant’s Retirement;
(C) 90 calendar days following termination of employment
or service for any reason other than such Participant’s death, Disability or Retirement, and other than such Participant’s
termination of employment or service for Cause, but not later than the expiration of the Option Period; and
(iii) both the unvested and the vested portion of an
Option shall immediately expire upon the termination of the Participant’s employment or service by the Company for Cause.
Notwithstanding the foregoing provisions of Section 7(c)
and consistent with the requirements of applicable law, the Committee, in its sole discretion, may extend the post-termination
of employment period during which a Participant may exercise vested Options.
(d)
Method of Exercise and Form of Payment
.
No Common Shares shall be delivered pursuant to the exercise of an Option until payment in full of the Exercise Price therefor
is received by the Company and the Participant has paid to the Company an amount equal to any federal, state, local and/or foreign
income and employment taxes required to be withheld. Options that have become exercisable may be exercised by delivery of written
or electronic notice of exercise to the Company in accordance with the terms of the Award Agreement accompanied by payment of the
Exercise Price. The Exercise Price shall be payable (i) in cash, check (subject to collection), cash equivalent and/or vested
Common Shares valued at the Fair Market Value at the time the Option is exercised (including, pursuant to procedures approved by
the Committee, by means of attestation of ownership of a sufficient number of Common Shares in lieu of actual delivery of such
shares to the Company);
provided, however,
that such Common Shares are not subject to any pledge or other security interest
and; (ii) by such other method as the Committee may permit in accordance with applicable law, in its sole discretion, including
without limitation: (A) in other property having a fair market value (as determined by the Committee in its discretion) on
the date of exercise equal to the Exercise Price or (B) if there is a public market for the Common Shares at such time, by
means of a broker-assisted “cashless exercise” pursuant to which the Company is delivered a copy of irrevocable instructions
to a stockbroker to sell the Common Shares otherwise deliverable upon the exercise of the Option and to deliver promptly to the
Company an amount equal to the Exercise Price or (C) by a “net exercise” method whereby the Company withholds
from the delivery of the Common Shares for which the Option was exercised that number of Common Shares having a Fair Market Value
equal to the aggregate Exercise Price for the Common Shares for which the Option was exercised. Any fractional Common Shares shall
be settled in cash.
(e)
Notification upon Disqualifying Disposition
of an Incentive Stock Option
. Each Participant awarded an Incentive Stock Option under this Plan shall notify the Company
in writing immediately after the date he makes a disqualifying disposition of any Common Shares acquired pursuant to the exercise
of such Incentive Stock Option. A disqualifying disposition is any disposition (including, without limitation, any sale) of such
Common Shares before the later of (A) two years after the Date of Grant of the Incentive Stock Option or (B) one year
after the date of exercise of the Incentive Stock Option. The Company may, if determined by the Committee and in accordance with
procedures established by the Committee, retain possession of any Common Shares acquired pursuant to the exercise of an Incentive
Stock Option as agent for the applicable Participant until the end of the period described in the preceding sentence.
(f)
Compliance with Laws, etc
. Notwithstanding
the foregoing, in no event shall a Participant be permitted to exercise an Option in a manner that the Committee determines would
violate the Sarbanes-Oxley Act of 2002, if applicable, or any other applicable law or the applicable rules and regulations of the
Securities and Exchange Commission or the applicable rules and regulations of any securities exchange or inter-dealer quotation
system on which the securities of the Company are listed or traded.
8.
Stock Appreciation Rights.
(a)
Generally
. Each SAR granted under
this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a
web site maintained by the Company or a third party under contract with the Company)). Each SAR so granted shall be subject to
the conditions set forth in this Section 8, and to such other conditions not inconsistent with this Plan as may be reflected
in the applicable Award Agreement. Any Option granted under this Plan may include tandem SARs (i.e., SARs granted in conjunction
with an Award of Options under this Plan). The Committee also may award SARs to Eligible Persons independent of any Option.
(b)
Exercise Price
. The Exercise Price
per Common Share for each Option granted in connection with a SAR shall not be less than 100% of the Fair Market Value of such
share determined as of the Date of Grant.
(c)
Vesting and Expiration
. A SAR granted
in connection with an Option shall become exercisable and shall expire according to the same vesting schedule and expiration provisions
as the corresponding Option. A SAR granted independent of an Option shall vest and become exercisable and shall expire in such
manner and on such date or dates determined by the Committee and shall expire after such period, not to exceed ten years, as may
be determined by the Committee (the “
SAR Period
”);
provided, however
, that notwithstanding any
vesting dates set by the Committee, the Committee may, in its sole discretion, accelerate the exercisability of any SAR, which
acceleration shall not affect the terms and conditions of such SAR other than with respect to exercisability. Unless otherwise
provided by the Committee in an Award Agreement:
(i) a SAR shall vest and become exercisable with respect
to 100% of the Common Shares subject to such SAR on the third anniversary of the Date of Grant;
(ii) the unvested portion of a SAR shall expire upon
termination of employment or service of the Participant granted the SAR, and the vested portion of such SAR shall remain exercisable
for:
(A) one year following termination of employment or
service by reason of such Participant’s death or Disability (with the determination of Disability to be made by the Committee
on a case by case basis), but not later than the expiration of the SAR Period;
(B) for directors, officers and employees of the Company
only, for the remainder of the SAR Period following termination of employment or service by reason of such Participant’s
Retirement;
(C) 90 calendar days following termination of employment
or service for any reason other than such Participant’s death, Disability or Retirement, and other than such Participant’s
termination of employment or service for Cause, but not later than the expiration of the SAR Period; and
(iii) both the unvested and the vested portion of a
SAR shall expire immediately upon the termination of the Participant’s employment or service by the Company for Cause.
(d)
Method of Exercise
. SARs that have
become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company in accordance with the
terms of the Award, specifying the number of SARs to be exercised and the date on which such SARs were awarded. Notwithstanding
the foregoing, if on the last day of the Option Period (or in the case of a SAR independent of an Option, the SAR Period), the
Fair Market Value exceeds the Strike Price, the Participant has not exercised the SAR or the corresponding Option (if applicable),
and neither the SAR nor the corresponding Option (if applicable) has expired, such SAR shall be deemed to have been exercised by
the Participant on such last day and the Company shall make the appropriate payment therefor.
(e)
Payment
. Upon the exercise of a SAR,
the Company shall pay to the Participant an amount equal to the number of Common Shares subject to the SAR that are being exercised
multiplied by the excess, if any, of the Fair Market Value of one Common Share on the exercise date over the Strike Price, less
an amount equal to any federal, state, local and non-U.S. income and employment taxes required to be withheld. The Company shall
pay such amount in cash, in Common Shares valued at Fair Market Value, or any combination thereof, as determined by the Committee.
Any fractional Common Share shall be settled in cash.
9.
Restricted Stock and Restricted Stock Units.
(a)
Generally
. Each grant of Restricted
Stock and Restricted Stock Units shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email
or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each such grant shall
be subject to the conditions set forth in this Section 9, and to such other conditions not inconsistent with this Plan as
may be reflected in the applicable Award Agreement. Restricted Stock and Restricted Stock Units shall be subject to such restrictions
on transferability and other restrictions as the Committee may impose (including, for example, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination
at such times, under such circumstances, in such installments, upon the satisfaction of Performance Goals or otherwise, as the
Committee determines at the time of the grant of an Award or thereafter. Except as otherwise provided in an Award Agreement, a
Participant shall have none of the rights of a stockholder with respect to Restricted Stock Units until such time as Common Shares
are paid in settlement of such Awards.
(b)
Restricted Accounts; Escrow or Similar Arrangement
.
Unless otherwise determined by the Committee, upon the grant of Restricted Stock, a book entry in a restricted account shall be
established in the Participant’s name at the Company’s transfer agent and, if the Committee determines that the Restricted
Stock shall be held by the Company or in escrow rather than held in such restricted account pending the release of the applicable
restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (i) an escrow agreement
satisfactory to the Committee, if applicable, and (ii) the appropriate share power (endorsed in blank) with respect to the
Restricted Stock covered by such agreement. If a Participant shall fail to execute an agreement evidencing an Award of Restricted
Stock and, if applicable, an escrow agreement and blank share power within the amount of time specified by the Committee, the Award
shall be null and void
ab initio
. Subject to the restrictions set forth in this Section 9 and the applicable Award
Agreement, the Participant generally shall have the rights and privileges of a stockholder as to such Restricted Stock, including
without limitation the right to vote such Restricted Stock and the right to receive dividends, if applicable. To the extent shares
of Restricted Stock are forfeited, any share certificates issued to the Participant evidencing such shares shall be returned to
the Company, and all rights of the Participant to such shares and as a stockholder with respect thereto shall terminate without
further obligation on the part of the Company.
(c)
Vesting; Acceleration of Lapse of Restrictions
.
Unless otherwise provided by the Committee in an Award Agreement: (i) the Restricted Period shall lapse with respect to 100%
of the Restricted Stock and Restricted Stock Units on the first anniversary of the Date of Grant; and (ii) the unvested portion
of Restricted Stock and Restricted Stock Units shall terminate and be forfeited upon the termination of employment or service of
the Participant granted the applicable Award.
(d)
Delivery of Restricted Stock and Settlement
of Restricted Stock Units
. (i) Upon the expiration of the Restricted Period with respect to any shares of Restricted
Stock, the restrictions set forth in the applicable Award Agreement shall be of no further force or effect with respect to such
shares, except as set forth in the applicable Award Agreement. If an escrow arrangement is used, upon such expiration, the Company
shall deliver to the Participant, or his beneficiary, without charge, the share certificate evidencing the shares of Restricted
Stock that have not then been forfeited and with respect to which the Restricted Period has expired (rounded down to the nearest
full share).Dividends, if any, that may have been withheld by the Committee and attributable to any particular share of Restricted
Stock shall be distributed to the Participant in cash or, at the sole discretion of the Committee, in shares of Common Stock having
a Fair Market Value equal to the amount of such dividends, upon the release of restrictions on such shares of Restricted Stock
and, if such shares of Restricted Stock are forfeited, the Participant shall have no right to such dividends (except as otherwise
set forth by the Committee in the applicable Award Agreement).
(ii) Unless otherwise provided by the Committee in
an Award Agreement, upon the expiration of the Restricted Period with respect to any outstanding Restricted Stock Units, the Company
shall deliver to the Participant, or his beneficiary, without charge, one Common Share for each such outstanding Restricted Stock
Unit;
provided, however
, that the Committee may, in its sole discretion and subject to the requirements of Section 409A
of the Code, elect to (i) pay cash or part cash and part Common Share in lieu of delivering only Common Shares in respect
of such Restricted Stock Units or (ii) defer the delivery of Common Shares (or cash or part Common Shares and part cash, as
the case may be) beyond the expiration of the Restricted Period if such delivery would result in a violation of applicable law
until such time as is no longer the case. If a cash payment is made in lieu of delivering Common Shares, the amount of such payment
shall be equal to the Fair Market Value of the Common Shares as of the date on which the Restricted Period lapsed with respect
to such Restricted Stock Units, less an amount equal to any federal, state, local and non-U.S. income and employment taxes required
to be withheld.
10.
Stock Bonus Awards
. The Committee may issue
unrestricted Common Shares, or other Awards denominated in Common Shares, under this Plan to Eligible Persons, either alone or
in tandem with other awards, in such amounts as the Committee shall from time to time in its sole discretion determine. Each Stock
Bonus Award granted under this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including
email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each Stock Bonus
Award so granted shall be subject to such conditions not inconsistent with this Plan as may be reflected in the applicable Award
Agreement.
11.
Performance Compensation Awards.
(a)
Generally
. The provisions of the
Plan are intended to enable Options and Stock Appreciation Rights granted hereunder to certain Eligible Persons to qualify for
an exemption under Section 162(m) of the Code. The Committee shall have the authority, at the time of grant of any Award described
in Sections 7 through 10 of this Plan, to designate such Award as a Performance Compensation Award intended to qualify as
“performance-based compensation” under Section 162(m) of the Code. The Committee shall have the authority to make
an award of a cash bonus to any Participant and designate such Award as a Performance Compensation Award intended to qualify as
“performance-based compensation” under Section 162(m) of the Code.
(b)
Discretion of Committee with Respect to Performance
Compensation Awards
. With regard to a particular Performance Period, the Committee shall have sole discretion to select
the length of such Performance Period, the type(s) of Performance Compensation Awards to be issued, the Performance Criteria that
will be used to establish the Performance Goal(s), the kind(s) and/or level(s) of the Performance Goals(s) that is (are) to apply
and the Performance Formula. Within the first 90 calendar days of a Performance Period (or, if longer or shorter, within the maximum
period allowed under Section 162(m) of the Code, if applicable), the Committee shall, with regard to the Performance Compensation
Awards to be issued for such Performance Period, exercise its discretion with respect to each of the matters enumerated in the
immediately preceding sentence and record the same in writing.
(c)
Performance Criteria
. The Performance
Criteria that will be used to establish the Performance Goal(s) shall be based on the attainment of specific levels of performance
of the Company and/or one or more Affiliates, divisions or operational units, or any combination of the foregoing, as determined
by the Committee, which criteria may be based on one or more of the following business criteria: (i) revenue; (ii) sales;
(iii) profit (net profit, gross profit, operating profit, economic profit, profit margins or other corporate profit measures);
(iv) earnings (EBIT, EBITDA, earnings per share, or other corporate earnings measures); (v) net income (before or after
taxes, operating income or other income measures); (vi) cash (cash flow, cash generation or other cash measures); (vii) stock
price or performance; (viii) total stockholder return (stock price appreciation plus reinvested dividends divided by beginning
share price); (ix) economic value added; (x) return measures (including, but not limited to, return on assets, capital,
equity, investments or sales, and cash flow return on assets, capital, equity, or sales); (xi) market share; (xii) improvements
in capital structure; (xiii) expenses (expense management, expense ratio, expense efficiency ratios or other expense measures);
(xiv) business expansion or consolidation (acquisitions and divestitures); (xv) internal rate of return or increase in
net present value; (xvi) working capital targets relating to inventory and/or accounts receivable; (xvii) inventory management;
(xviii) service or product delivery or quality; (xix) customer satisfaction; (xx) employee retention; (xxi) safety
standards; (xxii) productivity measures; (xxiii) cost reduction measures; and/or (xxiv) strategic plan development
and implementation. Any one or more of the Performance Criteria adopted by the Committee may be used on an absolute or relative
basis to measure the performance of the Company and/or one or more Affiliates as a whole or any business unit(s) of the Company
and/or one or more Affiliates or any combination thereof, as the Committee may deem appropriate, or any of the above Performance
Criteria may be compared to the performance of a selected group of comparison companies, or a published or special index that the
Committee, in its sole discretion, deems appropriate, or as compared to various stock market indices. The Committee also has the
authority to provide for accelerated vesting of any Award based on the achievement of Performance Goals pursuant to the Performance
Criteria specified in this paragraph. To the extent required under Section 162(m) of the Code, the Committee shall, within
the first 90 calendar days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m)
of the Code), define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance
Period and thereafter promptly communicate such Performance Criteria to the Participant.
(d)
Modification of Performance Goal(s)
.
In the event that applicable tax and/or securities laws change to permit Committee discretion to alter the governing Performance
Criteria without obtaining stockholder approval of such alterations, the Committee shall have sole discretion to make such alterations
without obtaining stockholder approval. The Committee is authorized at any time during the first 90 calendar days of a Performance
Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code, if applicable), or at
any time thereafter to the extent the exercise of such authority at such time would not cause the Performance Compensation Awards
granted to any Participant for such Performance Period to fail to qualify as “performance-based compensation” under
Section 162(m) of the Code, in its sole discretion, to adjust or modify the calculation of a Performance Goal for such Performance
Period, based on and in order to appropriately reflect the following events: (i) asset write-downs; (ii) litigation or
claim judgments or settlements; (iii) the effect of changes in tax laws, accounting principles, or other laws or regulatory
rules affecting reported results; (iv) any reorganization and restructuring programs; (v) extraordinary nonrecurring
items as described in Accounting Principles Board Opinion No. 30 (or any successor pronouncement thereto) and/or in management’s
discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders
for the applicable year; (vi) acquisitions or divestitures; (vii) any other specific unusual or nonrecurring events,
or objectively determinable category thereof; (viii) foreign exchange gains and losses; and (ix) a change in the Company’s
fiscal year.
(e)
Payment of Performance Compensation Awards
.
(i)
Condition to Receipt of Payment
.
Unless otherwise provided in the applicable Award Agreement, a Participant must be employed by, or in service to, the Company on
the last day of a Performance Period to be eligible for payment in respect of a Performance Compensation Award for such Performance
Period.
(ii)
Limitation
. A Participant shall
be eligible to receive payment in respect of a Performance Compensation Award only to the extent that: (A) the Performance
Goals for such period are achieved; and (B) all or some of the portion of such Participant’s Performance Compensation
Award has been earned for the Performance Period based on the application of the Performance Formula to such achieved Performance
Goals.
(iii)
Certification
. Following the completion
of a Performance Period, the Committee shall review and certify in writing whether, and to what extent, the Performance Goals for
the Performance Period have been achieved and, if so, calculate and certify in writing that amount of the Performance Compensation
Awards earned for the period based upon the Performance Formula. The Committee shall then determine the amount of each Participant’s
Performance Compensation Award actually payable for the Performance Period and, in so doing, may apply Negative Discretion.
(iv)
Use of Negative Discretion
. In determining
the actual amount of an individual Participant’s Performance Compensation Award for a Performance Period, the Committee may
reduce or eliminate the amount of the Performance Compensation Award earned under the Performance Formula in the Performance Period
through the use of Negative Discretion if, in its sole judgment, such reduction or elimination is appropriate. The Committee shall
not have the discretion, except as is otherwise provided in this Plan, to (A) grant or provide payment in respect of Performance
Compensation Awards for a Performance Period if the Performance Goals for such Performance Period have not been attained; or (B) increase
a Performance Compensation Award above the applicable limitations set forth in Section 5 of this Plan.
(f)
Timing of Award Payments
. Performance
Compensation Awards granted for a Performance Period shall be paid to Participants as soon as administratively practicable following
completion of the certifications required by this Section 11, but in no event later than two-and-one-half months following
the end of the fiscal year during which the Performance Period is completed in order to comply with the short-term deferral rules
under Section 1.409A-1(b)(4) of the Treasury Regulations. Notwithstanding the foregoing, payment of a Performance Compensation
Award may be delayed, as permitted by Section 1.409A-2(b)(7)(i) of the Treasury Regulations, to the extent that the Company
reasonably anticipates that if such payment were made as scheduled, the Company’s tax deduction with respect to such payment
would not be permitted due to the application of Section 162(m) of the Code.
12.
Changes in Capital Structure and Similar Events
.
In the event of (a) any dividend or other distribution (whether in the form of cash, Common Shares, other securities or other
property), recapitalization, stock split, reverse stock split, reorganization, merger, amalgamation, consolidation, split-up, split-off,
combination, repurchase or exchange of Common Shares or other securities of the Company, issuance of warrants or other rights to
acquire Common Shares or other securities of the Company, or other similar corporate transaction or event (including, without limitation,
a Change in Control) that affects the Common Shares, or (b) unusual or nonrecurring events (including, without limitation,
a Change in Control) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or changes
in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange or inter-dealer
quotation system, accounting principles or law, such that in either case an adjustment is determined by the Committee in its sole
discretion to be necessary or appropriate in order to prevent dilution or enlargement of rights, then the Committee shall make
any such adjustments that are equitable, including without limitation any or all of the following:
(i) adjusting any or all of (A) the number of
Common Shares or other securities of the Company (or number and kind of other securities or other property) that may be delivered
in respect of Awards or with respect to which Awards may be granted under this Plan (including, without limitation, adjusting any
or all of the limitations under Section 5 of this Plan) and (B) the terms of any outstanding Award, including, without
limitation, (1) the number of Common Shares or other securities of the Company (or number and kind of other securities or
other property) subject to outstanding Awards or to which outstanding Awards relate, (2) the Exercise Price or Strike Price
with respect to any Award or (3) any applicable performance measures (including, without limitation, Performance Criteria
and Performance Goals);
(ii) subject to the requirements of Section 409A
of the Code, providing for a substitution or assumption of Awards, accelerating the exercisability of, lapse of restrictions on,
or termination of, Awards or providing for a period of time for exercise prior to the occurrence of such event; and
(iii) subject to the requirements of Section 409A
of the Code, canceling any one or more outstanding Awards and causing to be paid to the holders thereof, in cash, Common Shares,
other securities or other property, or any combination thereof, the value of such Awards, if any, as determined by the Committee
(which if applicable may be based upon the price per Common Share received or to be received by other stockholders of the Company
in such event), including without limitation, in the case of an outstanding Option or SAR, a cash payment in an amount equal to
the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the Common Shares subject to such Option
or SAR over the aggregate Exercise Price or Strike Price of such Option or SAR, respectively (it being understood that, in such
event, any Option or SAR having a per share Exercise Price or Strike Price equal to, or in excess of, the Fair Market Value of
a Common Share subject thereto may be canceled and terminated without any payment or consideration therefor);
provided, however
,
that in the case of any “equity restructuring” (within the meaning of the Financial Accounting Standards Board Statement
of Financial Accounting Standards No. 123 (revised 2004) or ASC Topic 718, or any successor thereto), the Committee shall
make an equitable or proportionate adjustment to outstanding Awards to reflect such equity restructuring. Any adjustment in Incentive
Stock Options under this Section 12 (other than any cancellation of Incentive Stock Options) shall be made only to the extent
not constituting a “modification” within the meaning of Section 424(h)(3) of the Code, and any adjustments under
this Section 12 shall be made in a manner that does not adversely affect the exemption provided pursuant to Rule 16b-3 under
the Exchange Act. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall
be conclusive and binding for all purposes.
13.
Effect of Change in Control
. Except to the
extent otherwise provided in an Award Agreement, in the event of a Change in Control, notwithstanding any provision of this Plan
to the contrary, with respect to all or any portion of a particular outstanding Award or Awards:
(a) all of the then outstanding Options and SARs shall
immediately vest and become immediately exercisable as of a time prior to the Change in Control;
(b) the Restricted Period shall expire as of a time
prior to the Change in Control (including without limitation a waiver of any applicable Performance Goals);
(c) Performance Periods in effect on the date the Change
in Control occurs shall end on such date, and the Committee shall (i) determine the extent to which Performance Goals with
respect to each such Performance Period have been met based upon such audited or unaudited financial information or other information
then available as it deems relevant and (ii) cause the Participant to receive partial or full payment of Awards for each such
Performance Period based upon the Committee’s determination of the degree of attainment of the Performance Goals, or assuming
that the applicable “target” levels of performance have been attained or on such other basis determined by the Committee.
To the extent practicable, any actions taken by the
Committee under the immediately preceding clauses (a) through (c) shall occur in a manner and at a time which allows
affected Participants the ability to participate in the Change in Control transactions with respect to the Common Shares subject
to their Awards.
14.
Amendments and Termination.
(a)
Amendment and Termination of this Plan
.
The Board may amend, alter, suspend, discontinue, or terminate this Plan or any portion thereof at any time;
provided
, that
(i) no amendment to the definition of Eligible Person in Section 2(q), Section 5(b), Section 11(c) or Section 14(b)
(to the extent required by the proviso in such Section 14(b)) shall be made without stockholder approval and (ii) no
such amendment, alteration, suspension, discontinuation or termination shall be made without stockholder approval if such approval
is necessary to comply with any tax or regulatory requirement applicable to this Plan (including, without limitation, as necessary
to comply with any rules or requirements of any national securities exchange or inter-dealer quotation system on which the Common
Shares may be listed or quoted or to prevent the Company from being denied a tax deduction under Section 162(m) of the Code);
and, provided, further
, that any such amendment, alteration, suspension, discontinuance or termination that would materially
and adversely affect the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that
extent be effective without the prior written consent of the affected Participant, holder or beneficiary.
(b)
Amendment of Award Agreements
. The
Committee may, to the extent consistent with the terms of any applicable Award Agreement, waive any conditions or rights under,
amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted or the associated Award
Agreement, prospectively or retroactively;
provided, however
that any such waiver, amendment, alteration, suspension, discontinuance,
cancellation or termination that would materially and adversely affect the rights of any Participant with respect to any Award
theretofore granted shall not to that extent be effective without the consent of the affected Participant.
15.
General
.
(a)
Award Agreements
. Each Award under
this Plan shall be evidenced by an Award Agreement, which shall be delivered to the Participant (whether in paper or electronic
medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company))
and shall specify the terms and conditions of the Award and any rules applicable thereto, including without limitation, the effect
on such Award of the death, Disability or termination of employment or service of a Participant, or of such other events as may
be determined by the Committee. The Company’s failure to specify any term of any Award in any particular Award Agreement
shall not invalidate such term, provided such terms was duly adopted by the Board or the Committee.
(b)
Nontransferability; Trading Restrictions
.
(i) Each Award shall be exercisable only by a Participant
during the Participant’s lifetime, or, if permissible under applicable law, by the Participant’s legal guardian or
representative. No Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant
other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment,
sale, transfer or encumbrance shall be void and unenforceable against the Company or an Affiliate; provided that the designation
of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.
(ii) Notwithstanding the foregoing, the Committee may,
in its sole discretion, permit Awards (other than Incentive Stock Options) to be transferred by a Participant, with or without
consideration, subject to such rules as the Committee may adopt consistent with any applicable Award Agreement to preserve the
purposes of this Plan, to: (A) any person who is a “family member” of the Participant, as such term is used in
the instructions to Form S-8 under the Securities Act (collectively, the “
Immediate Family Members
”);
(B) a trust solely for the benefit of the Participant and his or her Immediate Family Members; or (C) a partnership or
limited liability company whose only partners or stockholders are the Participant and his or her Immediate Family Members; or (D) any
other transferee as may be approved either (I) by the Board or the Committee in its sole discretion, or (II) as provided in
the applicable Award Agreement (each transferee described in clauses (A), (B), (C) and (D) above is hereinafter referred
to as a “
Permitted Transferee
”);
provided
, that the Participant gives the Committee advance written
notice describing the terms and conditions of the proposed transfer and the Committee notifies the Participant in writing that
such a transfer would comply with the requirements of this Plan.
(iii) The terms of any Award transferred in accordance
with subparagraph (ii) above shall apply to the Permitted Transferee and any reference in this Plan, or in any applicable
Award Agreement, to a Participant shall be deemed to refer to the Permitted Transferee, except that (A) Permitted Transferees
shall not be entitled to transfer any Award, other than by will or the laws of descent and distribution; (B) Permitted Transferees
shall not be entitled to exercise any transferred Option unless there shall be in effect a registration statement on an appropriate
form covering the Common Shares to be acquired pursuant to the exercise of such Option if the Committee determines, consistent
with any applicable Award Agreement, that such a registration statement is necessary or appropriate; (C) the Committee or
the Company shall not be required to provide any notice to a Permitted Transferee, whether or not such notice is or would otherwise
have been required to be given to the Participant under this Plan or otherwise; and (D) the consequences of the termination
of the Participant’s employment by, or services to, the Company or an Affiliate under the terms of this Plan and the applicable
Award Agreement shall continue to be applied with respect to the Participant, including, without limitation, that an Option shall
be exercisable by the Permitted Transferee only to the extent, and for the periods, specified in this Plan and the applicable Award
Agreement.
(iv) The Committee shall have the right, either on
an Award-by-Award basis or as a matter of policy for all Awards or one or more classes of Awards, to condition the delivery of
vested Common Shares received in connection with such Award on the Participant’s agreement to such restrictions as the Committee
may determine.
(c)
Tax Withholding
.
(i) A Participant shall be required to pay to the Company
or any Affiliate, or the Company or any Affiliate shall have the right and is hereby authorized to withhold, from any cash, Common
Shares, other securities or other property deliverable under any Award or from any compensation or other amounts owing to a Participant,
the amount (in cash, Common Shares, other securities or other property) of any required withholding taxes in respect of an Award,
its exercise, or any payment or transfer under an Award or under this Plan and to take such other action as may be necessary in
the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding and taxes. In addition,
the Committee, in its discretion, may make arrangements mutually agreeable with a Participant who is not an employee of the Company
or an Affiliate to facilitate the payment of applicable income and self-employment taxes.
(ii) Without limiting the generality of clause (i) above,
the Committee may, in its sole discretion, permit a Participant to satisfy, in whole or in part, the foregoing withholding liability
by (A) the delivery of Common Shares (which are not subject to any pledge or other security interest) owned by the Participant
having a fair market value equal to such withholding liability or (B) having the Company withhold from the number of Common
Shares otherwise issuable or deliverable pursuant to the exercise or settlement of the Award a number of shares with a fair market
value equal to such withholding liability (but no more than the minimum required statutory withholding liability).
(d)
No Claim to Awards; No Rights to Continued
Employment; Waiver
. No employee of the Company or an Affiliate, or other person, shall have any claim or right to be granted
an Award under this Plan or, having been selected for the grant of an Award, to be selected for a grant of any other Award. There
is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards. The terms and conditions of
Awards and the Committee’s determinations and interpretations with respect thereto need not be the same with respect to each
Participant and may be made selectively among Participants, whether or not such Participants are similarly situated. Neither this
Plan nor any action taken hereunder shall be construed as giving any Participant any right to be retained in the employ or service
of the Company or an Affiliate, nor shall it be construed as giving any Participant any rights to continued service on the Board.
The Company or any of its Affiliates may at any time dismiss a Participant from employment or discontinue any consulting relationship,
free from any liability or any claim under this Plan, unless otherwise expressly provided in this Plan or any Award Agreement.
By accepting an Award under this Plan, a Participant shall thereby be deemed to have waived any claim to continued exercise or
vesting of an Award or to damages or severance entitlement related to non-continuation of the Award beyond the period provided
under this Plan or any Award Agreement, notwithstanding any provision to the contrary in any written employment contract or other
agreement between the Company and its Affiliates and the Participant, whether any such agreement is executed before, on or after
the Date of Grant.
(e)
International Participants
. With
respect to Participants who reside or work outside of the United States of America and who are not (and who are not expected to
be) “covered employees” within the meaning of Section 162(m) of the Code, the Committee may in its sole discretion
amend the terms of this Plan or outstanding Awards (or establish a sub-plan) with respect to such Participants in order to conform
such terms with the requirements of local law or to obtain more favorable tax or other treatment for such Participants, the Company
or its Affiliates.
(f)
Designation and Change of Beneficiary
.
Each Participant may file with the Committee a written designation of one or more persons as the beneficiary(ies) who shall be
entitled to receive the amounts payable with respect to an Award, if any, due under this Plan upon his or her death. A Participant
may, from time to time, revoke or change his or her beneficiary designation without the consent of any prior beneficiary by filing
a new designation with the Committee. The last such designation filed with the Committee shall be controlling;
provided, however
,
that no designation, or change or revocation thereof, shall be effective unless received by the Committee prior to the Participant’s
death, and in no event shall it be effective as of a date prior to such receipt. If no beneficiary designation is filed by a Participant,
the beneficiary shall be deemed to be his or her spouse or, if the Participant is unmarried at the time of death, his or her estate.
Upon the occurrence of a Participant’s divorce (as evidenced by a final order or decree of divorce), any spousal designation
previously given by such Participant shall automatically terminate.
(g)
Termination of Employment/Service
.
Unless determined otherwise by the Committee at any point following such event: (i) neither a temporary absence from employment
or service due to illness, vacation or leave of absence nor a transfer from employment or service with the Company to employment
or service with an Affiliate (or vice-versa) shall be considered a termination of employment or service with the Company or an
Affiliate; and (ii) if a Participant’s employment with the Company and its Affiliates terminates, but such Participant
continues to provide services to the Company and its Affiliates in a non-employee capacity (or vice-versa), such change in status
shall not be considered a termination of employment with the Company or an Affiliate for purposes of this Plan unless the Committee,
in its discretion, determines otherwise.
(h)
No Rights as a Stockholder
. Except
as otherwise specifically provided in this Plan or any Award Agreement, no person shall be entitled to the privileges of ownership
in respect of Common Shares that are subject to Awards hereunder until such shares have been issued or delivered to that person.
(i)
Government and Other Regulations
.
(i) The obligation of the Company to settle Awards
in Common Shares or other consideration shall be subject to all applicable laws, rules, and regulations, and to such approvals
by governmental agencies as may be required. Notwithstanding any terms or conditions of any Award to the contrary, the Company
shall be under no obligation to offer to sell or to sell, and shall be prohibited from offering to sell or selling, any Common
Shares pursuant to an Award unless such shares have been properly registered for sale pursuant to the Securities Act with the Securities
and Exchange Commission or unless the Company has received an opinion of counsel, satisfactory to the Company, that such shares
may be offered or sold without such registration pursuant to an available exemption therefrom and the terms and conditions of such
exemption have been fully complied with. The Company shall be under no obligation to register for sale under the Securities Act
any of the Common Shares to be offered or sold under this Plan. The Committee shall have the authority to provide that all certificates
for Common Shares or other securities of the Company or any Affiliate delivered under this Plan shall be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under this Plan, the applicable Award Agreement, the federal
securities laws, or the rules, regulations and other requirements of the Securities and Exchange Commission, any securities exchange
or inter-dealer quotation system upon which such shares or other securities are then listed or quoted and any other applicable
federal, state, local or non-U.S. laws, and, without limiting the generality of Section 9 of this Plan, the Committee may
cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. Notwithstanding
any provision in this Plan to the contrary, the Committee reserves the right to add any additional terms or provisions to any Award
granted under this Plan that it in its sole discretion deems necessary or advisable in order that such Award complies with the
legal requirements of any governmental entity to whose jurisdiction the Award is subject.
(ii) The Committee may cancel an Award or any portion
thereof if it determines, in its sole discretion, that legal or contractual restrictions and/or blockage and/or other market considerations
would make the Company’s acquisition of Common Shares from the public markets, the Company’s issuance of Common Shares
to the Participant, the Participant’s acquisition of Common Shares from the Company and/or the Participant’s sale of
Common Shares to the public markets, illegal, impracticable or inadvisable. If the Committee determines to cancel all or any portion
of an Award in accordance with the foregoing, unless doing so would violate Section 409A of the Code, the Company shall pay
to the Participant an amount equal to the excess of (A) the aggregate Fair Market Value of the Common Shares subject to such
Award or portion thereof canceled (determined as of the applicable exercise date, or the date that the shares would have been vested
or delivered, as applicable), over (B) the aggregate Exercise Price or Strike Price (in the case of an Option or SAR, respectively)
or any amount payable as a condition of delivery of Common Shares (in the case of any other Award). Such amount shall be delivered
to the Participant as soon as practicable following the cancellation of such Award or portion thereof. The Committee shall have
the discretion to consider and take action to mitigate the tax consequence to the Participant in cancelling an Award in accordance
with this clause.
(j)
Payments to Persons Other Than Participants
.
If the Committee shall find that any person to whom any amount is payable under this Plan is unable to care for his affairs because
of illness or accident, or is a minor, or has died, then any payment due to such person or his estate (unless a prior claim therefor
has been made by a duly appointed legal representative) may, if the Committee so directs the Company, be paid to his spouse, child,
relative, an institution maintaining or having custody of such person, or any other person deemed by the Committee to be a proper
recipient on behalf of such person otherwise entitled to payment. Any such payment shall be a complete discharge of the liability
of the Committee and the Company therefor.
(k)
Nonexclusivity of this Plan
. Neither
the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be
construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options or other equity-based awards otherwise than under this Plan, and such
arrangements may be either applicable generally or only in specific cases.
(l)
No Trust or Fund Created
. Neither
this Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship
between the Company or any Affiliate, on the one hand, and a Participant or other person or entity, on the other hand. No provision
of this Plan or any Award shall require the Company, for the purpose of satisfying any obligations under this Plan, to purchase
assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor
shall the Company maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately
maintained or administered fund for such purposes. Participants shall have no rights under this Plan other than as general unsecured
creditors of the Company, except that insofar as they may have become entitled to payment of additional compensation by performance
of services, they shall have the same rights as other employees under general law.
(m)
Reliance on Reports
. Each member
of the Committee and each member of the Board shall be fully justified in acting or failing to act, as the case may be, and shall
not be liable for having so acted or failed to act in good faith, in reliance upon any report made by the independent public accountant
of the Company and/or its Affiliates and/or any other information furnished in connection with this Plan by any agent of the Company
or the Committee or the Board, other than himself.
(n)
Relationship to Other Benefits
. No
payment under this Plan shall be taken into account in determining any benefits under any pension, retirement, profit sharing,
group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan.
(o)
Governing Law
. The Plan shall be
governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to the conflict
of laws provisions.
(p)
Severability
. If any provision of
this Plan or any Award or Award Agreement is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction
or as to any person or entity or Award, or would disqualify this Plan or any Award under any law deemed applicable by the Committee,
such provision shall be construed or deemed amended to conform to the applicable laws in the manner that most closely reflects
the original intent of the Award or the Plan, or if it cannot be construed or deemed amended without, in the determination of the
Committee, materially altering the intent of this Plan or the Award, such provision shall be construed or deemed stricken as to
such jurisdiction, person or entity or Award and the remainder of this Plan and any such Award shall remain in full force and effect.
(q)
Obligations Binding on Successors
.
The obligations of the Company under this Plan shall be binding upon any successor corporation or organization resulting from the
merger, amalgamation, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding
to substantially all of the assets and business of the Company.
(r)
Code Section 162(m) Approval
.
If so determined by the Committee, the provisions of this Plan regarding Performance Compensation Awards shall be disclosed and
reapproved by stockholders no later than the first stockholder meeting that occurs in the fifth year following the year in which
stockholders previously approved such provisions, in each case in order for certain Awards granted after such time to be exempt
from the deduction limitations of Section 162(m) of the Code. Nothing in this clause, however, shall affect the validity of
Awards granted after such time if such stockholder approval has not been obtained.
(s)
Expenses; Gender; Titles and Headings
.
The expenses of administering this Plan shall be borne by the Company and its Affiliates. Masculine pronouns and other words of
masculine gender shall refer to both men and women. The titles and headings of the sections in this Plan are for convenience of
reference only, and in the event of any conflict, the text of this Plan, rather than such titles or headings shall control.
(t)
Other Agreements
. Notwithstanding
the above, the Committee may require, as a condition to the grant of and/or the receipt of Common Shares under an Award, that the
Participant execute lock-up, stockholder or other agreements, as it may determine in its sole and absolute discretion.
(u)
Section 409A
. The Plan and all
Awards granted hereunder are intended to comply with, or otherwise be exempt from, the requirements of Section 409A of the
Code. The Plan and all Awards granted under this Plan shall be administered, interpreted, and construed in a manner consistent
with Section 409A of the Code to the extent necessary to avoid the imposition of additional taxes under Section 409A(a)(1)(B)
of the Code. Notwithstanding anything in this Plan to the contrary, in no event shall the Committee exercise its discretion to
accelerate the payment or settlement of an Award where such payment or settlement constitutes deferred compensation within the
meaning of Section 409A of the Code unless, and solely to the extent that, such accelerated payment or settlement is permissible
under Section 1.409A-3(j)(4) of the Treasury Regulations. If a Participant is a “specified employee” (within the
meaning of Section 1.409A-1(i) of the Treasury Regulations) at any time during the twelve (12)-month period ending on the
date of his termination of employment, and any Award hereunder subject to the requirements of Section 409A of the Code is
to be satisfied on account of the Participant’s termination of employment, satisfaction of such Award shall be suspended
until the date that is six (6) months after the date of such termination of employment.
(v)
Payments
.
Participants shall be required
to pay, to the extent required by applicable law, any amounts required to receive Common Shares under any Award made under this
Plan.
Exhibit
C
My Size, Inc.
2017
Consultant Equity Incentive Plan
MY SIZE, INC.
2017 CONSULTANT EQUITY INCENTIVE PLAN
1.
Purpose
. The purpose of the My Size, Inc.
2017 Consultant Equity Incentive Plan is to provide a means through which the Company and its Affiliates may attract and retain
key personnel and to provide a means whereby consultants and advisors of the Company and its Affiliates can acquire and maintain
an equity interest in the Company, or be paid incentive compensation, which may (but need not) be measured by reference to the
value of Common Shares, thereby strengthening their commitment to the welfare of the Company and its Affiliates and aligning their
interests with those of the Company’s stockholders.
2.
Definitions
. The following definitions shall
be applicable throughout this Plan:
(a) “
Affiliate
” means (i) any
person or entity that directly or indirectly controls, is controlled by or is under common control with the Company and/or (ii) to
the extent provided by the Committee, any person or entity in which the Company has a significant interest as determined by the
Committee in its discretion. The term “control” (including, with correlative meaning, the terms “controlled by”
and “under common control with”), as applied to any person or entity, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of such person or entity, whether through the ownership
of voting or other securities, by contract or otherwise.
(b) “
Award
” means, individually
or collectively, any Incentive Stock Option, Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, Restricted
Stock Unit, Stock Bonus Award or Performance Compensation Award granted under this Plan.
(c) “
Award Agreement
” means
an agreement made and delivered in accordance with Section 15(a) of this Plan evidencing the grant of an Award hereunder.
(d) “
Board
” means the Board
of Directors of the Company.
(e)
“
Business Day
”
means
any day other than a Saturday, a Sunday or a day on which banking institutions in New York City are authorized or obligated by
federal law or executive order to be closed.
(f) “
Cause
” means, in the
case of a particular Award, unless the applicable Award Agreement states otherwise, (i) the Company or an Affiliate having
“cause” to terminate a Participant’s employment or service, as defined in any employment or consulting agreement
or similar document or policy between the Participant and the Company or an Affiliate in effect at the time of such termination
or (ii) in the absence of any such employment or consulting agreement, document or policy (or the absence of any definition
of “Cause” contained therein), (A) a continuing material breach or material default (including, without limitation,
any material dereliction of duty) by Participant of any agreement between the Participant and the Company, except for any such
breach or default which is caused by the physical disability of the Participant (as determined by a neutral physician), or a continuing
failure by the Participant to follow the direction of a duly authorized representative of the Company; (B) gross negligence,
willful misfeasance or breach of fiduciary duty to the Company or Affiliate of the Company by the Participant; (C) the commission
by the Participant of an act of fraud, embezzlement or any felony or other crime of dishonesty in connection with the Participant’s
duties to the Company or Affiliate of the Company; or (D) conviction of the Participant of a felony or any other crime that
would materially and adversely affect: (i) the business reputation of the Company or Affiliate of the Company or (ii) the
performance of the Participant’s duties to the Company or an Affiliate of the Company. Any determination of whether Cause
exists shall be made by the Committee in its sole discretion.
(g) “
Change in Control
” shall,
in the case of a particular Award, unless the applicable Award Agreement states otherwise or contains a different definition of
“Change in Control,” be deemed to occur upon:
(i) A tender offer (or series of related offers) shall
be made and consummated for the ownership of 50% or more of the outstanding voting securities of the Company, unless as a result
of such tender offer more than 50% of the outstanding voting securities of the surviving or resulting corporation or entity shall
be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to the commencement of
such offer), or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
(ii) The Company shall be merged or consolidated with
another corporation, unless as a result of such merger or consolidation more than 50% of the outstanding voting securities of the
surviving or resulting corporation or entity shall be owned in the aggregate by (A) the shareholders of the Company (as of
the time immediately prior to such transaction); provided, that a merger or consolidation of the Company with another company which
is controlled by persons owning more than 50% of the outstanding voting securities of the Company shall constitute a Change in
Control unless the Committee, in its discretion, determine otherwise, or (B) any employee benefit plan of the Company or its
Subsidiaries, and their Affiliates;
(iii) The Company shall sell substantially all of its
assets to another entity that is not wholly owned by the Company, unless as a result of such sale more than 50% of such assets
shall be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to such transaction),
or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
(iv) A Person (as defined below) shall acquire 50%
or more of the outstanding voting securities of the Company (whether directly, indirectly, beneficially or of record), unless as
a result of such acquisition more than 50% of the outstanding voting securities of the surviving or resulting corporation or entity
shall be owned in the aggregate by (A) the shareholders of the Company (as of the time immediately prior to the first acquisition
of such securities by such Person), or (B) any employee benefit plan of the Company or its Subsidiaries, and their Affiliates;
or
(v) The individuals who, as of the date hereof, constitute
the members of the Board (the “Current Board Members”) cease, by reason of a financing, merger, combination, acquisition,
takeover or other non-ordinary course transaction affecting the Company, to constitute at least a majority of the members of the
Board unless such change is approved by the Current Board Members.
For purposes of this Section 2(g), ownership of
voting securities shall take into account and shall include ownership as determined by applying the provisions of Rule 13d-3(d)(I)(i)
(as in effect on the date hereof) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition,
for such purposes, “Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and
used in Sections 13(d) and 14(d) thereof; however, a Person shall not include
(A) the Company or any of its Subsidiaries; (B) a
trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries; (C) an
underwriter temporarily holding securities pursuant to an offering of such securities; or (D) a corporation owned, directly
or indirectly, by the shareholders of the Company in substantially the same proportion as their ownership of stock of the Company.
(h) “
Code
” means the Internal
Revenue Code of 1986, as amended, and any successor thereto. References in this Plan to any section of the Code shall be deemed
to include any regulations or other interpretative guidance issued by any governmental authority under such section, and any amendments
or successor provisions to such section, regulations or guidance.
(i) “
Committee
” means a committee
of at least two people as the Board may appoint to administer this Plan or, if no such committee has been appointed by the Board,
the Board. Unless altered by an action of the Board, the Committee shall be the Compensation Committee of the Board.
(j) “
Common Shares
” means
the common stock, par value $0.0001 per share, of the Company (and any stock or other securities into which such common shares
may be converted or into which they may be exchanged).
(k) “
Company
” means My Size,
Inc., a Delaware corporation, together with its successors and assigns.
(l) “
Current Board Members
”
has the meaning given such term in the definition of “Change in Control.”
(m) “
Date of Grant
” means
the date on which the granting of an Award is authorized, or such other date as may be specified in such authorization.
(n) “
Disability
” means a
“permanent and total” disability incurred by a Participant while in the employ or service of the Company or an Affiliate.
For this purpose, a permanent and total disability shall mean that the Participant is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than twelve (12) months. The determination of whether a Participant has
incurred a permanent and total disability shall be made by a physician designated by the Committee, whose determination shall be
final and binding.
(o) “
Effective Date
” means
the date as of which this Plan is adopted by the Board, subject to Section 3 of this Plan.
(p) “
Eligible Director
” means
a person who is (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, and (ii) an
“outside director” within the meaning of Section 162(m) of the Code.
(q) “
Eligible Person
” means
any consultant or advisor to the Company or an Affiliate, provided that if the Securities Act applies such persons must be eligible
to be offered securities registrable on Form S-8 under the Securities Act.
(r) “
Exchange Act
” has the
meaning given such term in the definition of “Change in Control,” and any reference in this Plan to any section of
(or rule promulgated under) the Exchange Act shall be deemed to include any rules, regulations or other interpretative guidance
issued by any governmental authority under such section or rule, and any amendments or successor provisions to such section, rules,
regulations or guidance.
(s) “
Exercise Price
” has
the meaning given such term in Section 7(b) of this Plan.
(t) “
Fair Market Value
”,
unless otherwise provided by the Committee in accordance with all applicable laws, rules regulations and standards, means, on a
given date, (i) if the Common Shares are listed on a national securities exchange, the closing sales price on the principal
exchange of the Common Shares on such date or, in the absence of reported sales on such date, the closing sales price on the immediately
preceding date on which sales were reported, or (ii) if the Common Shares are not listed on a national securities exchange,
the mean between the bid and offered prices as quoted by any nationally recognized interdealer quotation system for such date,
provided that if the Common Shares are not quoted on an interdealer quotation system or it is determined that the fair market value
is not properly reflected by such quotations, Fair Market Value will be determined by such other method as the Committee determines
in good faith to be reasonable and in compliance with Code Section 409A.
(u) “
Immediate Family Members
”
shall have the meaning set forth in Section 15(b) of this Plan.
(v) “
Incentive Stock Option
”
means an Option that is designated by the Committee as an incentive stock option as described in Section 422 of the Code and
otherwise meets the requirements set forth in this Plan.
(w) “
Indemnifiable Person
”
shall have the meaning set forth in Section 4(e) of this Plan.
(x) “
Negative Discretion
”
shall mean the discretion authorized by this Plan to be applied by the Committee to eliminate or reduce the size of a Performance
Compensation Award consistent with Section 162(m) of the Code.
(y) “
Nonqualified Stock Option
”
means an Option that is not designated by the Committee as an Incentive Stock Option.
(z) “
Option
” means an Award
granted under Section 7 of this Plan.
(aa) “
Option Period
” has
the meaning given such term in Section 7(c) of this Plan.
(bb) “
Participant
” means
an Eligible Person who has been selected by the Committee to participate in this Plan and to receive an Award pursuant to Section 6
of this Plan.
(cc) “
Performance Compensation Award
”
shall mean any Award designated by the Committee as a Performance Compensation Award pursuant to Section 11 of this Plan.
(dd) “
Performance Criteria
”
shall mean the criterion or criteria that the Committee shall select for purposes of establishing the Performance Goal(s) for a
Performance Period with respect to any Performance Compensation Award under this Plan.
(ee) “
Performance Formula
”
shall mean, for a Performance Period, the one or more objective formulae applied against the relevant Performance Goal to determine,
with regard to the Performance Compensation Award of a particular Participant, whether all, some portion but less than all, or
none of the Performance Compensation Award has been earned for the Performance Period.
(ff) “
Performance Goals
”
shall mean, for a Performance Period, the one or more goals established by the Committee for the Performance Period based upon
the Performance Criteria.
(gg) “
Performance Period
”
shall mean the one or more periods of time, as the Committee may select, over which the attainment of one or more Performance Goals
will be measured for the purpose of determining a Participant’s right to, and the payment of, a Performance Compensation
Award.
(hh) “
Permitted Transferee
”
shall have the meaning set forth in Section 15(b) of this Plan.
(ii) “
Person
” has the meaning
given such term in the definition of “Change in Control.”
(jj) “
Plan
” means this My
Size, Inc. 2017 Consultant Equity Incentive Plan, as amended from time to time.
(kk) “
Retirement
” means the
fulfillment of each of the following conditions: (i) the Participant is in good standing with the Company and/or an Affiliate
of the Company as determined by the Committee; (ii) the voluntary termination by a Participant of such Participant’s
employment or service to the Company and/or an Affiliate and (iii) that at the time of such voluntary termination, the sum
of: (A) the Participant’s age (calculated to the nearest month, with any resulting fraction of a year being calculated
as the number of months in the year divided by 12) and (B) the Participant’s years of employment or service with the
Company (calculated to the nearest month, with any resulting fraction of a year being calculated as the number of months in the
year divided by 12) equals at least 62 (provided that, in any case, the foregoing shall only be applicable if, at the time of such
Retirement, the Participant shall be at least 55 years of age and shall have been employed by or served with the Company for no
less than five years).
(ll) “
Restricted Period
”
means the period of time determined by the Committee during which an Award is subject to restrictions or, as applicable, the period
of time within which performance is measured for purposes of determining whether an Award has been earned.
(mm) “
Restricted Stock Unit
”
means an unfunded and unsecured promise to deliver Common Shares, cash, other securities or other property, subject to certain
restrictions (including, without limitation, a requirement that the Participant remain continuously employed or provide continuous
services for a specified period of time), granted under Section 9 of this Plan.
(nn) “
Restricted Stock
” means
Common Shares, subject to certain specified restrictions (including, without limitation, a requirement that the Participant remain
continuously employed or provide continuous services for a specified period of time), granted under Section 9 of this Plan.
(oo) “
SAR Period
” has the
meaning given such term in Section 8(c) of this Plan.
(pp) “
Securities Act
” means
the Securities Act of 1933, as amended, and any successor thereto. Reference in this Plan to any section of the Securities Act
shall be deemed to include any rules, regulations or other official interpretative guidance issued by any governmental authority
under such section, and any amendments or successor provisions to such section, rules, regulations or guidance.
(qq) “
Stock Appreciation Right
”
or
“
SAR
”
means an Award granted under Section 8 of this Plan which meets all of the requirements
of Section 1.409A-1(b)(5)(i)(B) of the Treasury Regulations.
(rr) “
Stock Bonus Award
”
means an Award granted under Section 10 of this Plan.
(ss) “
Strike Price
” means,
except as otherwise provided by the Committee in the case of Substitute Awards, (i) in the case of a SAR granted in tandem
with an Option, the Exercise Price of the related Option, or (ii) in the case of a SAR granted independent of an Option, the
Fair Market Value of Common Shares on the Date of Grant.
(tt) “
Subsidiary
” means,
with respect to any specified Person:
(i) any corporation, association or other business
entity of which more than 50% of the total voting power of shares of voting securities (without regard to the occurrence of any
contingency and after giving effect to any voting agreement or stockholders’ agreement that effectively transfers voting
power) is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and
(ii) any partnership or limited liability company (or
any comparable foreign entity) (a) the sole general partner or managing member (or functional equivalent thereof) or the managing
general partner of which is such Person or Subsidiary of such Person or (b) the only general partners or managing members
(or functional equivalents thereof) of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).
(uu) “
Substitute Award
” has
the meaning given such term in Section 5(e).
(vv) “
Treasury Regulations
”
means any regulations, whether proposed, temporary or final, promulgated by the U.S. Department of Treasury under the Code, and
any successor provisions.
3.
Effective Date; Duration
. The Plan shall
be effective on ,
2017, the date on which it is approved by the stockholders of the Company, which date shall be within twelve (12) months
before or after the date of the Plan’s adoption by the Board. The expiration date of this Plan, on and after which date
no Awards may be granted hereunder, shall be ,
2027, the tenth anniversary of the date on which the Plan was approved by the stockholders of the Company;
provided, however
,
that such expiration shall not affect Awards then outstanding, and the terms and conditions of this Plan shall continue to apply
to such Awards.
4.
Administration.
(a) The Committee shall administer this Plan. To the
extent required to comply with the provisions of Rule 16b-3 promulgated under the Exchange Act (if the Board is not acting as the
Committee under this Plan) or necessary to obtain the exception for performance-based compensation under Section 162(m) of
the Code, as applicable, it is intended that each member of the Committee shall, at the time he takes any action with respect to
an Award under this Plan, be an Eligible Director. However, the fact that a Committee member shall fail to qualify as an Eligible
Director shall not invalidate any Award granted by the Committee that is otherwise validly granted under this Plan. The acts of
a majority of the members present at any meeting at which a quorum is present or acts approved in writing by a majority of the
Committee shall be deemed the acts of the Committee. Whether a quorum is present shall be determined based on the Committee’s
charter as approved by the Board.
(b) Subject to the provisions of this Plan and applicable
law, the Committee shall have the sole and plenary authority, in addition to other express powers and authorizations conferred
on the Committee by this Plan and its charter, to: (i) designate Participants; (ii) determine the type or types of Awards
to be granted to a Participant; (iii) determine the number of Common Shares to be covered by, or with respect to which payments,
rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions of any Award;
(v) determine whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, Common Shares,
other securities, other Awards or other property, or canceled, forfeited, or suspended, and the method or methods by which Awards
may be settled, exercised, canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what circumstances
the delivery of cash, Common Shares, other securities, other Awards or other property and other amounts payable with respect to
an Award shall be made; (vii) interpret, administer, reconcile any inconsistency in, settle any controversy regarding, correct
any defect in and/or complete any omission in this Plan and any instrument or agreement relating to, or Award granted under, this
Plan; (viii) establish, amend, suspend, or waive any rules and regulations and appoint such agents as the Committee shall
deem appropriate for the proper administration of this Plan; (ix) accelerate the vesting or exercisability of, payment for
or lapse of restrictions on, Awards; (x) to reprice existing Awards or to grant Awards in connection with or in consideration
of the cancellation of an outstanding Award with a higher price; and (xi) make any other determination and take any other
action that the Committee deems necessary or desirable for the administration of this Plan.
(c) The Committee may, by resolution, expressly delegate
to a special committee, consisting of one or more directors who may but need not be officers of the Company, the authority, within
specified parameters as to the number and types of Awards, to (i) designate officers and/or employees of the Company or any
of its Affiliates to be recipients of Awards under this Plan, and (ii) to determine the number of such Awards to be received
by any such Participants; provided, however, that such delegation of duties and responsibilities may not be made with respect to
grants of Awards to persons (i) subject to Section 16 of the Exchange Act or (ii) who are, or who are reasonably
expected to be, “covered employees” for purposes of Section 162(m) of the Code. The acts of such delegates shall
be treated as acts of the Committee, and such delegates shall report regularly to the Board and the Committee regarding the delegated
duties and responsibilities and any Awards granted.
(d) Unless otherwise expressly provided in this Plan,
all designations, determinations, interpretations, and other decisions under or with respect to this Plan or any Award or any documents
evidencing Awards granted pursuant to this Plan shall be within the sole discretion of the Committee, may be made at any time and
shall be final, conclusive and binding upon all persons or entities, including, without limitation, the Company, any Affiliate,
any Participant, any holder or beneficiary of any Award, and any stockholder of the Company.
(e) No member of the Board, the Committee, delegate
of the Committee or any employee, advisor or agent of the Company or the Board or the Committee (each such person, an “
Indemnifiable
Person
”) shall be liable for any action taken or omitted to be taken or any determination made in good faith with
respect to this Plan or any Award hereunder. Each Indemnifiable Person shall be indemnified and held harmless by the Company against
and from (and the Company shall pay or reimburse on demand for) any loss, cost, liability, or expense (including court costs and
attorneys’ fees) that may be imposed upon or incurred by such Indemnifiable Person in connection with or resulting from any
action, suit or proceeding to which such Indemnifiable Person may be a party or in which such Indemnifiable Person may be involved
by reason of any action taken or omitted to be taken under this Plan or any Award Agreement and against and from any and all amounts
paid by such Indemnifiable Person with the Company’s approval, in settlement thereof, or paid by such Indemnifiable Person
in satisfaction of any judgment in any such action, suit or proceeding against such Indemnifiable Person,
provided
, that
the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and once the Company
gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company’s
choice. The foregoing right of indemnification shall not be available to an Indemnifiable Person to the extent that a final judgment
or other final adjudication (in either case not subject to further appeal) binding upon such Indemnifiable Person determines that
the acts or omissions of such Indemnifiable Person giving rise to the indemnification claim resulted from such Indemnifiable Person’s
bad faith, fraud or willful criminal act or omission or that such right of indemnification is otherwise prohibited by law or by
the Company’s Certificate of Incorporation or Bylaws. The foregoing right of indemnification shall not be exclusive of any
other rights of indemnification to which any such Indemnifiable Person may be entitled under the Company’s Certificate of
Incorporation or Bylaws, as a matter of law, or otherwise, or any other power that the Company may have to indemnify such Indemnifiable
Persons or hold them harmless.
(f) Notwithstanding anything to the contrary contained
in this Plan, the Board may, in its sole discretion, at any time and from time to time, grant Awards and administer this Plan with
respect to such Awards. In any such case, the Board shall have all the authority granted to the Committee under this Plan.
5.
Grant of Awards; Shares Subject to this Plan;
Limitations.
(a) The Committee may, from time to time, grant Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Stock Bonus Awards and/or Performance Compensation Awards
to one or more Eligible Persons.
(b) Subject to Section 12 of this Plan, the Committee
is authorized to deliver under this Plan an aggregate of 3,000,000 Common Shares.
(c) Common Shares underlying Awards under this Plan
that are forfeited, cancelled, expire unexercised, or are settled in cash shall be available again for Awards under this Plan at
the same ratio at which they were previously granted. Notwithstanding the foregoing, the following Common Shares shall not be available
again for Awards under the Plan: (i) shares tendered or held back upon the exercise of an Option or settlement of an Award
to cover the Exercise Price of an Award; (ii) shares that are used or withheld to satisfy tax withholding obligations of the
Participant; and (iii) shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement
of the SAR upon exercise thereof.
(d) Common Shares delivered by the Company in settlement
of Awards may be authorized and unissued shares, shares held in the treasury of the Company, shares purchased on the open market
or by private purchase, or any combination of the foregoing.
(e) Subject to compliance with Section 1.409A-3(f)
of the Treasury Regulations, Awards may, in the sole discretion of the Committee, be granted under this Plan in assumption of,
or in substitution for, outstanding awards previously granted by an entity acquired by the Company or with which the Company combines
(“
Substitute Awards
”). The number of Common Shares underlying any Substitute Awards shall be counted
against the aggregate number of Common Shares available for Awards under this Plan.
(f) Notwithstanding any provision in the Plan to the
contrary (but subject to adjustment as provided in Section 12), the Committee shall not grant to any one Eligible Person in
any one calendar year Awards (i) for more than 50% of the Available Shares in the aggregate or (ii) payable in cash in
an amount exceeding $10,000,000 in the aggregate.
6.
Eligibility
. Participation shall be limited
to Eligible Persons who have entered into an Award Agreement or who have received written notification from the Committee, or from
a person designated by the Committee, that they have been selected to participate in this Plan.
7.
Options.
(a)
Generally
. Each Option granted under
this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a
web site maintained by the Company or a third party under contract with the Company)). Each Option so granted shall be subject
to the conditions set forth in this Section 7, and to such other conditions not inconsistent with this Plan as may be reflected
in the applicable Award Agreement. All Options granted under this Plan shall be Nonqualified Stock Options unless the applicable
Award Agreement expressly states that the Option is intended to be an Incentive Stock Option. Notwithstanding any designation of
an Option, to the extent that the aggregate Fair Market Value of Common Shares with respect to which Options designated as Incentive
Stock Options are exercisable for the first time by any Participant during any calendar year (under all plans of the Company or
any Subsidiary) exceeds $100,000, such excess Options shall be treated as Nonqualified Stock Options. Incentive Stock Options shall
be granted only to Eligible Persons who are employees of the Company and its Affiliates, and no Incentive Stock Option shall be
granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the Code. No Option shall be treated
as an Incentive Stock Option unless this Plan has been approved by the stockholders of the Company in a manner intended to comply
with the stockholder approval requirements of Section 422(b)(1) of the Code, provided that any Option intended to be an Incentive
Stock Option shall not fail to be effective solely on account of a failure to obtain such approval, but rather such Option shall
be treated as a Nonqualified Stock Option unless and until such approval is obtained. In the case of an Incentive Stock Option,
the terms and conditions of such grant shall be subject to and comply with such rules as may be prescribed by Section 422
of the Code. If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) shall not qualify as
an Incentive Stock Option, then, to the extent of such nonqualification, such Option or portion thereof shall be regarded as a
Nonqualified Stock Option appropriately granted under this Plan.
(b)
Exercise Price
. The exercise price
(“
Exercise Price
”) per Common Share for each Option shall not be less than 100% of the Fair Market Value
of such share determined as of the Date of Grant;
provided, however
, that in the case of an Incentive Stock Option granted
to an employee who, at the time of the grant of such Option, owns shares representing more than 10% of the voting power of all
classes of shares of the Company or any Affiliate, the Exercise Price per share shall not be less than 110% of the Fair Market
Value per share on the Date of Grant;
and, provided further,
that notwithstanding any provision herein to the contrary,
the Exercise Price shall not be less than the par value per Common Share.
(c)
Vesting and Expiration
. Options shall
vest and become exercisable in such manner and on such date or dates determined by the Committee and as set forth in the applicable
Award Agreement, and shall expire after such period, not to exceed ten (10) years from the Date of Grant, as may be determined
by the Committee (the “
Option Period
”);
provided, however
, that the Option Period shall not exceed
five (5) years from the Date of Grant in the case of an Incentive Stock Option granted to a Participant who on the Date of
Grant owns shares representing more than 10% of the voting power of all classes of shares of the Company or any Affiliate;
and,
provided, further
, that notwithstanding any vesting dates set by the Committee, the Committee may, in its sole discretion,
accelerate the exercisability of any Option, which acceleration shall not affect the terms and conditions of such Option other
than with respect to exercisability. Unless otherwise provided by the Committee in an Award Agreement:
(i) an Option shall vest and become exercisable with
respect to 100% of the Common Shares subject to such Option on each anniversary of the Date of Grant;
(ii) the unvested portion of an Option shall expire
upon termination of employment or service of the Participant granted the Option, and the vested portion of such Option shall remain
exercisable for:
(A) one year following termination of employment or
service by reason of such Participant’s death or Disability (with the determination of Disability to be made by the Committee
on a case by case basis), but not later than the expiration of the Option Period;
(B) for directors, officers and employees of the Company
only, for ninety (90) days following termination of employment or service by reason of such Participant’s Retirement;
(C) 90 calendar days following termination of employment
or service for any reason other than such Participant’s death, Disability or Retirement, and other than such Participant’s
termination of employment or service for Cause, but not later than the expiration of the Option Period; and
(iii) both the unvested and the vested portion of an
Option shall immediately expire upon the termination of the Participant’s employment or service by the Company for Cause.
Notwithstanding the foregoing provisions of Section 7(c)
and consistent with the requirements of applicable law, the Committee, in its sole discretion, may extend the post-termination
of employment period during which a Participant may exercise vested Options.
(d)
Method of Exercise and Form of Payment
.
No Common Shares shall be delivered pursuant to the exercise of an Option until payment in full of the Exercise Price therefor
is received by the Company and the Participant has paid to the Company an amount equal to any federal, state, local and/or foreign
income and employment taxes required to be withheld. Options that have become exercisable may be exercised by delivery of written
or electronic notice of exercise to the Company in accordance with the terms of the Award Agreement accompanied by payment of the
Exercise Price. The Exercise Price shall be payable (i) in cash, check (subject to collection), cash equivalent and/or vested
Common Shares valued at the Fair Market Value at the time the Option is exercised (including, pursuant to procedures approved by
the Committee, by means of attestation of ownership of a sufficient number of Common Shares in lieu of actual delivery of such
shares to the Company);
provided, however,
that such Common Shares are not subject to any pledge or other security interest
and; (ii) by such other method as the Committee may permit in accordance with applicable law, in its sole discretion, including
without limitation: (A) in other property having a fair market value (as determined by the Committee in its discretion) on
the date of exercise equal to the Exercise Price or (B) if there is a public market for the Common Shares at such time, by
means of a broker-assisted “cashless exercise” pursuant to which the Company is delivered a copy of irrevocable instructions
to a stockbroker to sell the Common Shares otherwise deliverable upon the exercise of the Option and to deliver promptly to the
Company an amount equal to the Exercise Price or (C) by a “net exercise” method whereby the Company withholds
from the delivery of the Common Shares for which the Option was exercised that number of Common Shares having a Fair Market Value
equal to the aggregate Exercise Price for the Common Shares for which the Option was exercised. Any fractional Common Shares shall
be settled in cash.
(e)
Notification upon Disqualifying Disposition
of an Incentive Stock Option
. Each Participant awarded an Incentive Stock Option under this Plan shall notify the Company
in writing immediately after the date he makes a disqualifying disposition of any Common Shares acquired pursuant to the exercise
of such Incentive Stock Option. A disqualifying disposition is any disposition (including, without limitation, any sale) of such
Common Shares before the later of (A) two years after the Date of Grant of the Incentive Stock Option or (B) one year
after the date of exercise of the Incentive Stock Option. The Company may, if determined by the Committee and in accordance with
procedures established by the Committee, retain possession of any Common Shares acquired pursuant to the exercise of an Incentive
Stock Option as agent for the applicable Participant until the end of the period described in the preceding sentence.
(f)
Compliance with Laws, etc
. Notwithstanding
the foregoing, in no event shall a Participant be permitted to exercise an Option in a manner that the Committee determines would
violate the Sarbanes-Oxley Act of 2002, if applicable, or any other applicable law or the applicable rules and regulations of the
Securities and Exchange Commission or the applicable rules and regulations of any securities exchange or inter-dealer quotation
system on which the securities of the Company are listed or traded.
8.
Stock Appreciation Rights.
(a)
Generally
. Each SAR granted under
this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email or the posting on a
web site maintained by the Company or a third party under contract with the Company)). Each SAR so granted shall be subject to
the conditions set forth in this Section 8, and to such other conditions not inconsistent with this Plan as may be reflected
in the applicable Award Agreement. Any Option granted under this Plan may include tandem SARs (i.e., SARs granted in conjunction
with an Award of Options under this Plan). The Committee also may award SARs to Eligible Persons independent of any Option.
(b)
Exercise Price
. The Exercise Price
per Common Share for each Option granted in connection with a SAR shall not be less than 100% of the Fair Market Value of such
share determined as of the Date of Grant.
(c)
Vesting and Expiration
. A SAR granted
in connection with an Option shall become exercisable and shall expire according to the same vesting schedule and expiration provisions
as the corresponding Option. A SAR granted independent of an Option shall vest and become exercisable and shall expire in such
manner and on such date or dates determined by the Committee and shall expire after such period, not to exceed ten years, as may
be determined by the Committee (the “
SAR Period
”);
provided, however
, that notwithstanding any
vesting dates set by the Committee, the Committee may, in its sole discretion, accelerate the exercisability of any SAR, which
acceleration shall not affect the terms and conditions of such SAR other than with respect to exercisability. Unless otherwise
provided by the Committee in an Award Agreement:
(i) a SAR shall vest and become exercisable with respect
to 100% of the Common Shares subject to such SAR on the third anniversary of the Date of Grant;
(ii) the unvested portion of a SAR shall expire upon
termination of employment or service of the Participant granted the SAR, and the vested portion of such SAR shall remain exercisable
for:
(A) one year following termination of employment or
service by reason of such Participant’s death or Disability (with the determination of Disability to be made by the Committee
on a case by case basis), but not later than the expiration of the SAR Period;
(B) for directors, officers and employees of the Company
only, for the remainder of the SAR Period following termination of employment or service by reason of such Participant’s
Retirement;
(C) 90 calendar days following termination of employment
or service for any reason other than such Participant’s death, Disability or Retirement, and other than such Participant’s
termination of employment or service for Cause, but not later than the expiration of the SAR Period; and
(iii) both the unvested and the vested portion of a
SAR shall expire immediately upon the termination of the Participant’s employment or service by the Company for Cause.
(d)
Method of Exercise
. SARs that have
become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company in accordance with the
terms of the Award, specifying the number of SARs to be exercised and the date on which such SARs were awarded. Notwithstanding
the foregoing, if on the last day of the Option Period (or in the case of a SAR independent of an Option, the SAR Period), the
Fair Market Value exceeds the Strike Price, the Participant has not exercised the SAR or the corresponding Option (if applicable),
and neither the SAR nor the corresponding Option (if applicable) has expired, such SAR shall be deemed to have been exercised by
the Participant on such last day and the Company shall make the appropriate payment therefor.
(e)
Payment
. Upon the exercise of a SAR,
the Company shall pay to the Participant an amount equal to the number of Common Shares subject to the SAR that are being exercised
multiplied by the excess, if any, of the Fair Market Value of one Common Share on the exercise date over the Strike Price, less
an amount equal to any federal, state, local and non-U.S. income and employment taxes required to be withheld. The Company shall
pay such amount in cash, in Common Shares valued at Fair Market Value, or any combination thereof, as determined by the Committee.
Any fractional Common Share shall be settled in cash.
9.
Restricted Stock and Restricted Stock Units.
(a)
Generally
. Each grant of Restricted
Stock and Restricted Stock Units shall be evidenced by an Award Agreement (whether in paper or electronic medium (including email
or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each such grant shall
be subject to the conditions set forth in this Section 9, and to such other conditions not inconsistent with this Plan as
may be reflected in the applicable Award Agreement. Restricted Stock and Restricted Stock Units shall be subject to such restrictions
on transferability and other restrictions as the Committee may impose (including, for example, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination
at such times, under such circumstances, in such installments, upon the satisfaction of Performance Goals or otherwise, as the
Committee determines at the time of the grant of an Award or thereafter. Except as otherwise provided in an Award Agreement, a
Participant shall have none of the rights of a stockholder with respect to Restricted Stock Units until such time as Common Shares
are paid in settlement of such Awards.
(b)
Restricted Accounts; Escrow or Similar Arrangement
.
Unless otherwise determined by the Committee, upon the grant of Restricted Stock, a book entry in a restricted account shall be
established in the Participant’s name at the Company’s transfer agent and, if the Committee determines that the Restricted
Stock shall be held by the Company or in escrow rather than held in such restricted account pending the release of the applicable
restrictions, the Committee may require the Participant to additionally execute and deliver to the Company (i) an escrow agreement
satisfactory to the Committee, if applicable, and (ii) the appropriate share power (endorsed in blank) with respect to the
Restricted Stock covered by such agreement. If a Participant shall fail to execute an agreement evidencing an Award of Restricted
Stock and, if applicable, an escrow agreement and blank share power within the amount of time specified by the Committee, the Award
shall be null and void
ab initio
. Subject to the restrictions set forth in this Section 9 and the applicable Award
Agreement, the Participant generally shall have the rights and privileges of a stockholder as to such Restricted Stock, including
without limitation the right to vote such Restricted Stock and the right to receive dividends, if applicable. To the extent shares
of Restricted Stock are forfeited, any share certificates issued to the Participant evidencing such shares shall be returned to
the Company, and all rights of the Participant to such shares and as a stockholder with respect thereto shall terminate without
further obligation on the part of the Company.
(c)
Vesting; Acceleration of Lapse of Restrictions
.
Unless otherwise provided by the Committee in an Award Agreement: (i) the Restricted Period shall lapse with respect to 100%
of the Restricted Stock and Restricted Stock Units on the first anniversary of the Date of Grant; and (ii) the unvested portion
of Restricted Stock and Restricted Stock Units shall terminate and be forfeited upon the termination of employment or service of
the Participant granted the applicable Award.
(d)
Delivery of Restricted Stock and Settlement
of Restricted Stock Units
. (i) Upon the expiration of the Restricted Period with respect to any shares of Restricted
Stock, the restrictions set forth in the applicable Award Agreement shall be of no further force or effect with respect to such
shares, except as set forth in the applicable Award Agreement. If an escrow arrangement is used, upon such expiration, the Company
shall deliver to the Participant, or his beneficiary, without charge, the share certificate evidencing the shares of Restricted
Stock that have not then been forfeited and with respect to which the Restricted Period has expired (rounded down to the nearest
full share).Dividends, if any, that may have been withheld by the Committee and attributable to any particular share of Restricted
Stock shall be distributed to the Participant in cash or, at the sole discretion of the Committee, in shares of Common Stock having
a Fair Market Value equal to the amount of such dividends, upon the release of restrictions on such shares of Restricted Stock
and, if such shares of Restricted Stock are forfeited, the Participant shall have no right to such dividends (except as otherwise
set forth by the Committee in the applicable Award Agreement).
(ii) Unless otherwise provided by the Committee in
an Award Agreement, upon the expiration of the Restricted Period with respect to any outstanding Restricted Stock Units, the Company
shall deliver to the Participant, or his beneficiary, without charge, one Common Share for each such outstanding Restricted Stock
Unit;
provided, however
, that the Committee may, in its sole discretion and subject to the requirements of Section 409A
of the Code, elect to (i) pay cash or part cash and part Common Share in lieu of delivering only Common Shares in respect
of such Restricted Stock Units or (ii) defer the delivery of Common Shares (or cash or part Common Shares and part cash, as
the case may be) beyond the expiration of the Restricted Period if such delivery would result in a violation of applicable law
until such time as is no longer the case. If a cash payment is made in lieu of delivering Common Shares, the amount of such payment
shall be equal to the Fair Market Value of the Common Shares as of the date on which the Restricted Period lapsed with respect
to such Restricted Stock Units, less an amount equal to any federal, state, local and non-U.S. income and employment taxes required
to be withheld.
10.
Stock Bonus Awards
. The Committee may issue
unrestricted Common Shares, or other Awards denominated in Common Shares, under this Plan to Eligible Persons, either alone or
in tandem with other awards, in such amounts as the Committee shall from time to time in its sole discretion determine. Each Stock
Bonus Award granted under this Plan shall be evidenced by an Award Agreement (whether in paper or electronic medium (including
email or the posting on a web site maintained by the Company or a third party under contract with the Company)). Each Stock Bonus
Award so granted shall be subject to such conditions not inconsistent with this Plan as may be reflected in the applicable Award
Agreement.
11.
Performance Compensation Awards.
(a)
Generally
. The provisions of the
Plan are intended to enable Options and Stock Appreciation Rights granted hereunder to certain Eligible Persons to qualify for
an exemption under Section 162(m) of the Code. The Committee shall have the authority, at the time of grant of any Award described
in Sections 7 through 10 of this Plan, to designate such Award as a Performance Compensation Award intended to qualify as
“performance-based compensation” under Section 162(m) of the Code. The Committee shall have the authority to make
an award of a cash bonus to any Participant and designate such Award as a Performance Compensation Award intended to qualify as
“performance-based compensation” under Section 162(m) of the Code.
(b)
Discretion of Committee with Respect to Performance
Compensation Awards
. With regard to a particular Performance Period, the Committee shall have sole discretion to select
the length of such Performance Period, the type(s) of Performance Compensation Awards to be issued, the Performance Criteria that
will be used to establish the Performance Goal(s), the kind(s) and/or level(s) of the Performance Goals(s) that is (are) to apply
and the Performance Formula. Within the first 90 calendar days of a Performance Period (or, if longer or shorter, within the maximum
period allowed under Section 162(m) of the Code, if applicable), the Committee shall, with regard to the Performance Compensation
Awards to be issued for such Performance Period, exercise its discretion with respect to each of the matters enumerated in the
immediately preceding sentence and record the same in writing.
(c)
Performance Criteria
. The Performance
Criteria that will be used to establish the Performance Goal(s) shall be based on the attainment of specific levels of performance
of the Company and/or one or more Affiliates, divisions or operational units, or any combination of the foregoing, as determined
by the Committee, which criteria may be based on one or more of the following business criteria: (i) revenue; (ii) sales;
(iii) profit (net profit, gross profit, operating profit, economic profit, profit margins or other corporate profit measures);
(iv) earnings (EBIT, EBITDA, earnings per share, or other corporate earnings measures); (v) net income (before or after
taxes, operating income or other income measures); (vi) cash (cash flow, cash generation or other cash measures); (vii) stock
price or performance; (viii) total stockholder return (stock price appreciation plus reinvested dividends divided by beginning
share price); (ix) economic value added; (x) return measures (including, but not limited to, return on assets, capital,
equity, investments or sales, and cash flow return on assets, capital, equity, or sales); (xi) market share; (xii) improvements
in capital structure; (xiii) expenses (expense management, expense ratio, expense efficiency ratios or other expense measures);
(xiv) business expansion or consolidation (acquisitions and divestitures); (xv) internal rate of return or increase in
net present value; (xvi) working capital targets relating to inventory and/or accounts receivable; (xvii) inventory management;
(xviii) service or product delivery or quality; (xix) customer satisfaction; (xx) employee retention; (xxi) safety
standards; (xxii) productivity measures; (xxiii) cost reduction measures; and/or (xxiv) strategic plan development
and implementation. Any one or more of the Performance Criteria adopted by the Committee may be used on an absolute or relative
basis to measure the performance of the Company and/or one or more Affiliates as a whole or any business unit(s) of the Company
and/or one or more Affiliates or any combination thereof, as the Committee may deem appropriate, or any of the above Performance
Criteria may be compared to the performance of a selected group of comparison companies, or a published or special index that the
Committee, in its sole discretion, deems appropriate, or as compared to various stock market indices. The Committee also has the
authority to provide for accelerated vesting of any Award based on the achievement of Performance Goals pursuant to the Performance
Criteria specified in this paragraph. To the extent required under Section 162(m) of the Code, the Committee shall, within
the first 90 calendar days of a Performance Period (or, if longer or shorter, within the maximum period allowed under Section 162(m)
of the Code), define in an objective fashion the manner of calculating the Performance Criteria it selects to use for such Performance
Period and thereafter promptly communicate such Performance Criteria to the Participant.
(d)
Modification of Performance Goal(s)
.
In the event that applicable tax and/or securities laws change to permit Committee discretion to alter the governing Performance
Criteria without obtaining stockholder approval of such alterations, the Committee shall have sole discretion to make such alterations
without obtaining stockholder approval. The Committee is authorized at any time during the first 90 calendar days of a Performance
Period (or, if longer or shorter, within the maximum period allowed under Section 162(m) of the Code, if applicable), or at
any time thereafter to the extent the exercise of such authority at such time would not cause the Performance Compensation Awards
granted to any Participant for such Performance Period to fail to qualify as “performance-based compensation” under
Section 162(m) of the Code, in its sole discretion, to adjust or modify the calculation of a Performance Goal for such Performance
Period, based on and in order to appropriately reflect the following events: (i) asset write-downs; (ii) litigation or
claim judgments or settlements; (iii) the effect of changes in tax laws, accounting principles, or other laws or regulatory
rules affecting reported results; (iv) any reorganization and restructuring programs; (v) extraordinary nonrecurring
items as described in Accounting Principles Board Opinion No. 30 (or any successor pronouncement thereto) and/or in management’s
discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders
for the applicable year; (vi) acquisitions or divestitures; (vii) any other specific unusual or nonrecurring events,
or objectively determinable category thereof; (viii) foreign exchange gains and losses; and (ix) a change in the Company’s
fiscal year.
(e)
Payment of Performance Compensation Awards
.
(i)
Condition to Receipt of Payment
.
Unless otherwise provided in the applicable Award Agreement, a Participant must be employed by, or in service to, the Company on
the last day of a Performance Period to be eligible for payment in respect of a Performance Compensation Award for such Performance
Period.
(ii)
Limitation
. A Participant shall
be eligible to receive payment in respect of a Performance Compensation Award only to the extent that: (A) the Performance
Goals for such period are achieved; and (B) all or some of the portion of such Participant’s Performance Compensation
Award has been earned for the Performance Period based on the application of the Performance Formula to such achieved Performance
Goals.
(iii)
Certification
. Following the completion
of a Performance Period, the Committee shall review and certify in writing whether, and to what extent, the Performance Goals for
the Performance Period have been achieved and, if so, calculate and certify in writing that amount of the Performance Compensation
Awards earned for the period based upon the Performance Formula. The Committee shall then determine the amount of each Participant’s
Performance Compensation Award actually payable for the Performance Period and, in so doing, may apply Negative Discretion.
(iv)
Use of Negative Discretion
. In determining
the actual amount of an individual Participant’s Performance Compensation Award for a Performance Period, the Committee may
reduce or eliminate the amount of the Performance Compensation Award earned under the Performance Formula in the Performance Period
through the use of Negative Discretion if, in its sole judgment, such reduction or elimination is appropriate. The Committee shall
not have the discretion, except as is otherwise provided in this Plan, to (A) grant or provide payment in respect of Performance
Compensation Awards for a Performance Period if the Performance Goals for such Performance Period have not been attained; or (B) increase
a Performance Compensation Award above the applicable limitations set forth in Section 5 of this Plan.
(f)
Timing of Award Payments
. Performance
Compensation Awards granted for a Performance Period shall be paid to Participants as soon as administratively practicable following
completion of the certifications required by this Section 11, but in no event later than two-and-one-half months following
the end of the fiscal year during which the Performance Period is completed in order to comply with the short-term deferral rules
under Section 1.409A-1(b)(4) of the Treasury Regulations. Notwithstanding the foregoing, payment of a Performance Compensation
Award may be delayed, as permitted by Section 1.409A-2(b)(7)(i) of the Treasury Regulations, to the extent that the Company
reasonably anticipates that if such payment were made as scheduled, the Company’s tax deduction with respect to such payment
would not be permitted due to the application of Section 162(m) of the Code.
12.
Changes in Capital Structure and Similar Events
.
In the event of (a) any dividend or other distribution (whether in the form of cash, Common Shares, other securities or other
property), recapitalization, stock split, reverse stock split, reorganization, merger, amalgamation, consolidation, split-up, split-off,
combination, repurchase or exchange of Common Shares or other securities of the Company, issuance of warrants or other rights to
acquire Common Shares or other securities of the Company, or other similar corporate transaction or event (including, without limitation,
a Change in Control) that affects the Common Shares, or (b) unusual or nonrecurring events (including, without limitation,
a Change in Control) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or changes
in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange or inter-dealer
quotation system, accounting principles or law, such that in either case an adjustment is determined by the Committee in its sole
discretion to be necessary or appropriate in order to prevent dilution or enlargement of rights, then the Committee shall make
any such adjustments that are equitable, including without limitation any or all of the following:
(i) adjusting any or all of (A) the number of
Common Shares or other securities of the Company (or number and kind of other securities or other property) that may be delivered
in respect of Awards or with respect to which Awards may be granted under this Plan (including, without limitation, adjusting any
or all of the limitations under Section 5 of this Plan) and (B) the terms of any outstanding Award, including, without
limitation, (1) the number of Common Shares or other securities of the Company (or number and kind of other securities or
other property) subject to outstanding Awards or to which outstanding Awards relate, (2) the Exercise Price or Strike Price
with respect to any Award or (3) any applicable performance measures (including, without limitation, Performance Criteria
and Performance Goals);
(ii) subject to the requirements of Section 409A
of the Code, providing for a substitution or assumption of Awards, accelerating the exercisability of, lapse of restrictions on,
or termination of, Awards or providing for a period of time for exercise prior to the occurrence of such event; and
(iii) subject to the requirements of Section 409A
of the Code, canceling any one or more outstanding Awards and causing to be paid to the holders thereof, in cash, Common Shares,
other securities or other property, or any combination thereof, the value of such Awards, if any, as determined by the Committee
(which if applicable may be based upon the price per Common Share received or to be received by other stockholders of the Company
in such event), including without limitation, in the case of an outstanding Option or SAR, a cash payment in an amount equal to
the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the Common Shares subject to such Option
or SAR over the aggregate Exercise Price or Strike Price of such Option or SAR, respectively (it being understood that, in such
event, any Option or SAR having a per share Exercise Price or Strike Price equal to, or in excess of, the Fair Market Value of
a Common Share subject thereto may be canceled and terminated without any payment or consideration therefor);
provided, however
,
that in the case of any “equity restructuring” (within the meaning of the Financial Accounting Standards Board Statement
of Financial Accounting Standards No. 123 (revised 2004) or ASC Topic 718, or any successor thereto), the Committee shall
make an equitable or proportionate adjustment to outstanding Awards to reflect such equity restructuring. Any adjustment in Incentive
Stock Options under this Section 12 (other than any cancellation of Incentive Stock Options) shall be made only to the extent
not constituting a “modification” within the meaning of Section 424(h)(3) of the Code, and any adjustments under
this Section 12 shall be made in a manner that does not adversely affect the exemption provided pursuant to Rule 16b-3 under
the Exchange Act. The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall
be conclusive and binding for all purposes.
13.
Effect of Change in Control
. Except to the
extent otherwise provided in an Award Agreement, in the event of a Change in Control, notwithstanding any provision of this Plan
to the contrary, with respect to all or any portion of a particular outstanding Award or Awards:
(a) all of the then outstanding Options and SARs shall
immediately vest and become immediately exercisable as of a time prior to the Change in Control;
(b) the Restricted Period shall expire as of a time
prior to the Change in Control (including without limitation a waiver of any applicable Performance Goals);
(c) Performance Periods in effect on the date the Change
in Control occurs shall end on such date, and the Committee shall (i) determine the extent to which Performance Goals with
respect to each such Performance Period have been met based upon such audited or unaudited financial information or other information
then available as it deems relevant and (ii) cause the Participant to receive partial or full payment of Awards for each such
Performance Period based upon the Committee’s determination of the degree of attainment of the Performance Goals, or assuming
that the applicable “target” levels of performance have been attained or on such other basis determined by the Committee.
To the extent practicable, any actions taken by the
Committee under the immediately preceding clauses (a) through (c) shall occur in a manner and at a time which allows
affected Participants the ability to participate in the Change in Control transactions with respect to the Common Shares subject
to their Awards.
14.
Amendments and Termination.
(a)
Amendment and Termination of this Plan
.
The Board may amend, alter, suspend, discontinue, or terminate this Plan or any portion thereof at any time;
provided
, that
(i) no amendment to the definition of Eligible Person in Section 2(q), Section 5(b), Section 11(c) or Section 14(b)
(to the extent required by the proviso in such Section 14(b)) shall be made without stockholder approval and (ii) no
such amendment, alteration, suspension, discontinuation or termination shall be made without stockholder approval if such approval
is necessary to comply with any tax or regulatory requirement applicable to this Plan (including, without limitation, as necessary
to comply with any rules or requirements of any national securities exchange or inter-dealer quotation system on which the Common
Shares may be listed or quoted or to prevent the Company from being denied a tax deduction under Section 162(m) of the Code);
and, provided, further
, that any such amendment, alteration, suspension, discontinuance or termination that would materially
and adversely affect the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that
extent be effective without the prior written consent of the affected Participant, holder or beneficiary.
(b)
Amendment of Award Agreements
. The
Committee may, to the extent consistent with the terms of any applicable Award Agreement, waive any conditions or rights under,
amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted or the associated Award
Agreement, prospectively or retroactively;
provided, however
that any such waiver, amendment, alteration, suspension, discontinuance,
cancellation or termination that would materially and adversely affect the rights of any Participant with respect to any Award
theretofore granted shall not to that extent be effective without the consent of the affected Participant.
15.
General
.
(a)
Award Agreements
. Each Award under
this Plan shall be evidenced by an Award Agreement, which shall be delivered to the Participant (whether in paper or electronic
medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company))
and shall specify the terms and conditions of the Award and any rules applicable thereto, including without limitation, the effect
on such Award of the death, Disability or termination of employment or service of a Participant, or of such other events as may
be determined by the Committee. The Company’s failure to specify any term of any Award in any particular Award Agreement
shall not invalidate such term, provided such terms was duly adopted by the Board or the Committee.
(b)
Nontransferability; Trading Restrictions
.
(i) Each Award shall be exercisable only by a Participant
during the Participant’s lifetime, or, if permissible under applicable law, by the Participant’s legal guardian or
representative. No Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant
other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment,
sale, transfer or encumbrance shall be void and unenforceable against the Company or an Affiliate; provided that the designation
of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.
(ii) Notwithstanding the foregoing, the Committee may,
in its sole discretion, permit Awards (other than Incentive Stock Options) to be transferred by a Participant, with or without
consideration, subject to such rules as the Committee may adopt consistent with any applicable Award Agreement to preserve the
purposes of this Plan, to: (A) any person who is a “family member” of the Participant, as such term is used in
the instructions to Form S-8 under the Securities Act (collectively, the “
Immediate Family Members
”);
(B) a trust solely for the benefit of the Participant and his or her Immediate Family Members; or (C) a partnership or
limited liability company whose only partners or stockholders are the Participant and his or her Immediate Family Members; or (D) any
other transferee as may be approved either (I) by the Board or the Committee in its sole discretion, or (II) as provided in
the applicable Award Agreement (each transferee described in clauses (A), (B), (C) and (D) above is hereinafter referred
to as a “
Permitted Transferee
”);
provided
, that the Participant gives the Committee advance written
notice describing the terms and conditions of the proposed transfer and the Committee notifies the Participant in writing that
such a transfer would comply with the requirements of this Plan.
(iii) The terms of any Award transferred in accordance
with subparagraph (ii) above shall apply to the Permitted Transferee and any reference in this Plan, or in any applicable
Award Agreement, to a Participant shall be deemed to refer to the Permitted Transferee, except that (A) Permitted Transferees
shall not be entitled to transfer any Award, other than by will or the laws of descent and distribution; (B) Permitted Transferees
shall not be entitled to exercise any transferred Option unless there shall be in effect a registration statement on an appropriate
form covering the Common Shares to be acquired pursuant to the exercise of such Option if the Committee determines, consistent
with any applicable Award Agreement, that such a registration statement is necessary or appropriate; (C) the Committee or
the Company shall not be required to provide any notice to a Permitted Transferee, whether or not such notice is or would otherwise
have been required to be given to the Participant under this Plan or otherwise; and (D) the consequences of the termination
of the Participant’s employment by, or services to, the Company or an Affiliate under the terms of this Plan and the applicable
Award Agreement shall continue to be applied with respect to the Participant, including, without limitation, that an Option shall
be exercisable by the Permitted Transferee only to the extent, and for the periods, specified in this Plan and the applicable Award
Agreement.
(iv) The Committee shall have the right, either on
an Award-by-Award basis or as a matter of policy for all Awards or one or more classes of Awards, to condition the delivery of
vested Common Shares received in connection with such Award on the Participant’s agreement to such restrictions as the Committee
may determine.
(c)
Tax Withholding
.
(i) A Participant shall be required to pay to the Company
or any Affiliate, or the Company or any Affiliate shall have the right and is hereby authorized to withhold, from any cash, Common
Shares, other securities or other property deliverable under any Award or from any compensation or other amounts owing to a Participant,
the amount (in cash, Common Shares, other securities or other property) of any required withholding taxes in respect of an Award,
its exercise, or any payment or transfer under an Award or under this Plan and to take such other action as may be necessary in
the opinion of the Committee or the Company to satisfy all obligations for the payment of such withholding and taxes. In addition,
the Committee, in its discretion, may make arrangements mutually agreeable with a Participant who is not an employee of the Company
or an Affiliate to facilitate the payment of applicable income and self-employment taxes.
(ii) Without limiting the generality of clause (i) above,
the Committee may, in its sole discretion, permit a Participant to satisfy, in whole or in part, the foregoing withholding liability
by (A) the delivery of Common Shares (which are not subject to any pledge or other security interest) owned by the Participant
having a fair market value equal to such withholding liability or (B) having the Company withhold from the number of Common
Shares otherwise issuable or deliverable pursuant to the exercise or settlement of the Award a number of shares with a fair market
value equal to such withholding liability (but no more than the minimum required statutory withholding liability).
(d)
No Claim to Awards; No Rights to Continued
Employment; Waiver
. No employee of the Company or an Affiliate, or other person, shall have any claim or right to be granted
an Award under this Plan or, having been selected for the grant of an Award, to be selected for a grant of any other Award. There
is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards. The terms and conditions of
Awards and the Committee’s determinations and interpretations with respect thereto need not be the same with respect to each
Participant and may be made selectively among Participants, whether or not such Participants are similarly situated. Neither this
Plan nor any action taken hereunder shall be construed as giving any Participant any right to be retained in the employ or service
of the Company or an Affiliate, nor shall it be construed as giving any Participant any rights to continued service on the Board.
The Company or any of its Affiliates may at any time dismiss a Participant from employment or discontinue any consulting relationship,
free from any liability or any claim under this Plan, unless otherwise expressly provided in this Plan or any Award Agreement.
By accepting an Award under this Plan, a Participant shall thereby be deemed to have waived any claim to continued exercise or
vesting of an Award or to damages or severance entitlement related to non-continuation of the Award beyond the period provided
under this Plan or any Award Agreement, notwithstanding any provision to the contrary in any written employment contract or other
agreement between the Company and its Affiliates and the Participant, whether any such agreement is executed before, on or after
the Date of Grant.
(e)
International Participants
. With
respect to Participants who reside or work outside of the United States of America and who are not (and who are not expected to
be) “covered employees” within the meaning of Section 162(m) of the Code, the Committee may in its sole discretion
amend the terms of this Plan or outstanding Awards (or establish a sub-plan) with respect to such Participants in order to conform
such terms with the requirements of local law or to obtain more favorable tax or other treatment for such Participants, the Company
or its Affiliates.
(f)
Designation and Change of Beneficiary
.
Each Participant may file with the Committee a written designation of one or more persons as the beneficiary(ies) who shall be
entitled to receive the amounts payable with respect to an Award, if any, due under this Plan upon his or her death. A Participant
may, from time to time, revoke or change his or her beneficiary designation without the consent of any prior beneficiary by filing
a new designation with the Committee. The last such designation filed with the Committee shall be controlling;
provided, however
,
that no designation, or change or revocation thereof, shall be effective unless received by the Committee prior to the Participant’s
death, and in no event shall it be effective as of a date prior to such receipt. If no beneficiary designation is filed by a Participant,
the beneficiary shall be deemed to be his or her spouse or, if the Participant is unmarried at the time of death, his or her estate.
Upon the occurrence of a Participant’s divorce (as evidenced by a final order or decree of divorce), any spousal designation
previously given by such Participant shall automatically terminate.
(g)
Termination of Employment/Service
.
Unless determined otherwise by the Committee at any point following such event: (i) neither a temporary absence from employment
or service due to illness, vacation or leave of absence nor a transfer from employment or service with the Company to employment
or service with an Affiliate (or vice-versa) shall be considered a termination of employment or service with the Company or an
Affiliate; and (ii) if a Participant’s employment with the Company and its Affiliates terminates, but such Participant
continues to provide services to the Company and its Affiliates in a non-employee capacity (or vice-versa), such change in status
shall not be considered a termination of employment with the Company or an Affiliate for purposes of this Plan unless the Committee,
in its discretion, determines otherwise.
(h)
No Rights as a Stockholder
. Except
as otherwise specifically provided in this Plan or any Award Agreement, no person shall be entitled to the privileges of ownership
in respect of Common Shares that are subject to Awards hereunder until such shares have been issued or delivered to that person.
(i)
Government and Other Regulations
.
(i) The obligation of the Company to settle Awards
in Common Shares or other consideration shall be subject to all applicable laws, rules, and regulations, and to such approvals
by governmental agencies as may be required. Notwithstanding any terms or conditions of any Award to the contrary, the Company
shall be under no obligation to offer to sell or to sell, and shall be prohibited from offering to sell or selling, any Common
Shares pursuant to an Award unless such shares have been properly registered for sale pursuant to the Securities Act with the Securities
and Exchange Commission or unless the Company has received an opinion of counsel, satisfactory to the Company, that such shares
may be offered or sold without such registration pursuant to an available exemption therefrom and the terms and conditions of such
exemption have been fully complied with. The Company shall be under no obligation to register for sale under the Securities Act
any of the Common Shares to be offered or sold under this Plan. The Committee shall have the authority to provide that all certificates
for Common Shares or other securities of the Company or any Affiliate delivered under this Plan shall be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under this Plan, the applicable Award Agreement, the federal
securities laws, or the rules, regulations and other requirements of the Securities and Exchange Commission, any securities exchange
or inter-dealer quotation system upon which such shares or other securities are then listed or quoted and any other applicable
federal, state, local or non-U.S. laws, and, without limiting the generality of Section 9 of this Plan, the Committee may
cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. Notwithstanding
any provision in this Plan to the contrary, the Committee reserves the right to add any additional terms or provisions to any Award
granted under this Plan that it in its sole discretion deems necessary or advisable in order that such Award complies with the
legal requirements of any governmental entity to whose jurisdiction the Award is subject.
(ii) The Committee may cancel an Award or any portion
thereof if it determines, in its sole discretion, that legal or contractual restrictions and/or blockage and/or other market considerations
would make the Company’s acquisition of Common Shares from the public markets, the Company’s issuance of Common Shares
to the Participant, the Participant’s acquisition of Common Shares from the Company and/or the Participant’s sale of
Common Shares to the public markets, illegal, impracticable or inadvisable. If the Committee determines to cancel all or any portion
of an Award in accordance with the foregoing, unless doing so would violate Section 409A of the Code, the Company shall pay
to the Participant an amount equal to the excess of (A) the aggregate Fair Market Value of the Common Shares subject to such
Award or portion thereof canceled (determined as of the applicable exercise date, or the date that the shares would have been vested
or delivered, as applicable), over (B) the aggregate Exercise Price or Strike Price (in the case of an Option or SAR, respectively)
or any amount payable as a condition of delivery of Common Shares (in the case of any other Award). Such amount shall be delivered
to the Participant as soon as practicable following the cancellation of such Award or portion thereof. The Committee shall have
the discretion to consider and take action to mitigate the tax consequence to the Participant in cancelling an Award in accordance
with this clause.
(j)
Payments to Persons Other Than Participants
.
If the Committee shall find that any person to whom any amount is payable under this Plan is unable to care for his affairs because
of illness or accident, or is a minor, or has died, then any payment due to such person or his estate (unless a prior claim therefor
has been made by a duly appointed legal representative) may, if the Committee so directs the Company, be paid to his spouse, child,
relative, an institution maintaining or having custody of such person, or any other person deemed by the Committee to be a proper
recipient on behalf of such person otherwise entitled to payment. Any such payment shall be a complete discharge of the liability
of the Committee and the Company therefor.
(k)
Nonexclusivity of this Plan
. Neither
the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be
construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options or other equity-based awards otherwise than under this Plan, and such
arrangements may be either applicable generally or only in specific cases.
(l)
No Trust or Fund Created
. Neither
this Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship
between the Company or any Affiliate, on the one hand, and a Participant or other person or entity, on the other hand. No provision
of this Plan or any Award shall require the Company, for the purpose of satisfying any obligations under this Plan, to purchase
assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor
shall the Company maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately
maintained or administered fund for such purposes. Participants shall have no rights under this Plan other than as general unsecured
creditors of the Company, except that insofar as they may have become entitled to payment of additional compensation by performance
of services, they shall have the same rights as other employees under general law.
(m)
Reliance on Reports
. Each member
of the Committee and each member of the Board shall be fully justified in acting or failing to act, as the case may be, and shall
not be liable for having so acted or failed to act in good faith, in reliance upon any report made by the independent public accountant
of the Company and/or its Affiliates and/or any other information furnished in connection with this Plan by any agent of the Company
or the Committee or the Board, other than himself.
(n)
Relationship to Other Benefits
. No
payment under this Plan shall be taken into account in determining any benefits under any pension, retirement, profit sharing,
group insurance or other benefit plan of the Company except as otherwise specifically provided in such other plan.
(o)
Governing Law
. The Plan shall be
governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to the conflict
of laws provisions.
(p)
Severability
. If any provision of
this Plan or any Award or Award Agreement is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction
or as to any person or entity or Award, or would disqualify this Plan or any Award under any law deemed applicable by the Committee,
such provision shall be construed or deemed amended to conform to the applicable laws in the manner that most closely reflects
the original intent of the Award or the Plan, or if it cannot be construed or deemed amended without, in the determination of the
Committee, materially altering the intent of this Plan or the Award, such provision shall be construed or deemed stricken as to
such jurisdiction, person or entity or Award and the remainder of this Plan and any such Award shall remain in full force and effect.
(q)
Obligations Binding on Successors
.
The obligations of the Company under this Plan shall be binding upon any successor corporation or organization resulting from the
merger, amalgamation, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding
to substantially all of the assets and business of the Company.
(r)
Code Section 162(m) Approval
.
If so determined by the Committee, the provisions of this Plan regarding Performance Compensation Awards shall be disclosed and
reapproved by stockholders no later than the first stockholder meeting that occurs in the fifth year following the year in which
stockholders previously approved such provisions, in each case in order for certain Awards granted after such time to be exempt
from the deduction limitations of Section 162(m) of the Code. Nothing in this clause, however, shall affect the validity of
Awards granted after such time if such stockholder approval has not been obtained.
(s)
Expenses; Gender; Titles and Headings
.
The expenses of administering this Plan shall be borne by the Company and its Affiliates. Masculine pronouns and other words of
masculine gender shall refer to both men and women. The titles and headings of the sections in this Plan are for convenience of
reference only, and in the event of any conflict, the text of this Plan, rather than such titles or headings shall control.
(t)
Other Agreements
. Notwithstanding
the above, the Committee may require, as a condition to the grant of and/or the receipt of Common Shares under an Award, that the
Participant execute lock-up, stockholder or other agreements, as it may determine in its sole and absolute discretion.
(u)
Section 409A
. The Plan and all
Awards granted hereunder are intended to comply with, or otherwise be exempt from, the requirements of Section 409A of the
Code. The Plan and all Awards granted under this Plan shall be administered, interpreted, and construed in a manner consistent
with Section 409A of the Code to the extent necessary to avoid the imposition of additional taxes under Section 409A(a)(1)(B)
of the Code. Notwithstanding anything in this Plan to the contrary, in no event shall the Committee exercise its discretion to
accelerate the payment or settlement of an Award where such payment or settlement constitutes deferred compensation within the
meaning of Section 409A of the Code unless, and solely to the extent that, such accelerated payment or settlement is permissible
under Section 1.409A-3(j)(4) of the Treasury Regulations. If a Participant is a “specified employee” (within the
meaning of Section 1.409A-1(i) of the Treasury Regulations) at any time during the twelve (12)-month period ending on the
date of his termination of employment, and any Award hereunder subject to the requirements of Section 409A of the Code is
to be satisfied on account of the Participant’s termination of employment, satisfaction of such Award shall be suspended
until the date that is six (6) months after the date of such termination of employment.
(v)
Payments
.
Participants shall be required
to pay, to the extent required by applicable law, any amounts required to receive Common Shares under any Award made under this
Plan.
MY
SIZE INC.