Current Report — Form 8-K Filing Table of Contents
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1: 8-K Current Report -- fhcmarch272008form8k HTML 17K
2: EX-99.1 Exhibit 99.1 to March 27, 2008 Form 8-K HTML 83K
1.
Purposes of the Plan. The
purpose of this Plan is to advance the interests of the Company's shareholders
by enhancing the Company's ability to attract, retain and motivate persons
who
make (or are expected to make) important contributions to the Company by
providing such persons with equity ownership opportunities and performance-based
incentives and thereby better aligning the interests of such persons with those
of the Company's shareholders.
2.
Definitions. As
used herein, the following definitions shall apply:
(a)
"Administrator"
means the Board or any of its Committees authorized to administer the Plan,
in
accordance with Section 4 of the Plan.
(b)
"Applicable
Laws" means the requirements relating to the administration of stock
incentive plans under applicable state corporate laws, U.S. federal and state
securities laws, the Code, any stock exchange or quotation system on which
the
Common Stock is listed or quoted and the applicable laws of any foreign country
or jurisdiction where Awards are, or will be, granted under the
Plan.
(c)
"Award" means
any Restricted Stock, Option or Stock Appreciation Right awarded to a Service
Provider pursuant to this Plan.
(d)
"Board" means
the Board of Directors of the Company.
(e)
"Cause" means
the definition of Cause in a Grantee's employment agreement, if any, with the
Company. If no such employment agreement or definition in such
agreement exists, Cause means (i) breach by a Grantee of any covenant not to
compete or confidentiality agreement with the Company, (ii) failure by a Grantee
to substantially perform his or her duties to the reasonable satisfaction of
the
Board, (iii) serious misconduct by a Grantee which is demonstrably and
substantially injurious to the Company, (iv) fraud or dishonesty by a Grantee
with respect to the Company, (v) material misrepresentation by a Grantee to
a
shareholder or director of the Company, (vi) acts of negligence by a Grantee
in
the performance of Grantee's duties that are substantially injurious to the
Company or (vii) a Grantee's conviction of, or a plea of guilty or nolo
contendere to, a felony or other crime involving moral turpitude. The
Administrator shall make the determination of whether Cause exists.
(f)
"Code" means
the Internal Revenue Code of 1986, as amended from time to time, and any
successor thereto.
(g)
"Committee"
means a committee of Directors appointed by the Board in accordance with
Section 4 of the Plan.
(h)
"Common Stock"
means the Common Stock, par value $0.01 per share, of the Company.
(i)
"Company" means
The Female Health Company, a Wisconsin corporation.
(j)
"Consultant"
means any person, including an advisor, engaged by the Company or a Parent
or
Subsidiary to render services to such entity.
(k)
"Director"
means a member of the Board.
(l)
"Disability"
means total and permanent disability as defined in Section 22(e)(3) of the
Code.
(m) "Employee"
means any
person, including Officers and Directors, employed by the Company or any Parent
or Subsidiary of the Company. A Service Provider shall not cease to
be an Employee in the case of (i) any leave of absence approved by the
Company or (ii) transfers between locations of the Company or between the
Company, its Parent, any Subsidiary, or any successor. Neither
service as a Director nor payment of a director's fee by the Company shall
be
sufficient to constitute "employment" by the Company.
(n)
"Exchange Act"
means the Securities Exchange Act of 1934, as amended.
(o)
"Fair Market
Value" means, as of any date, the value of the Common Stock determined as
follows:
(i)
if the Common Stock is listed on any established stock exchange or a national
market system, including, without limitation, the American Stock Exchange,
its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system
for
the day of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems
reliable;
(ii)
if the Common Stock is regularly quoted by a recognized securities dealer but
selling prices are not reported, the Fair Market Value of a share of Common
Stock shall be the mean between the high bid and low asked prices for the Common
Stock for the day of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems reliable;
or
(iii)
in the absence of an established market for the Common Stock, the Fair
Market Value shall be determined in good faith by the
Administrator.
(p)
"Grant
Agreement" means an agreement between the Company and a Grantee
evidencing the terms and conditions of an individual Award. The Grant
Agreement is subject to the terms and conditions of the Plan
(q)
"Grantee" means
the holder of an outstanding Award granted under the Plan.
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(r)
"Incentive Stock
Option" means an Option granted under this Plan which is intended to
qualify as an "incentive stock option" within the meaning of Section 422 of
the
Code. Any such Option which in fact does not qualify as an "incentive
stock option" within the meaning of Section 422 of the Code shall be deemed
to
be a Nonstatutory Option.
(s)
"Nonstatutory
Option" means an Option granted under this Plan which is not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code. Nonstatutory Options may be granted at such times and subject
to such restrictions as the Administrator shall determine without conforming
to
the statutory rules of Section 422 of the Code applicable to incentive stock
options.
(t)
"Officer" means
a person who is an officer of the Company within the meaning of Section 16
of
the Exchange Act and the rules and regulations promulgated
thereunder.
(u) "Option"
means an
Incentive Stock Option or Nonstatutory Option granted pursuant to the
Plan.
(v) "Parent"
means a
"parent corporation," whether now or hereafter existing, as defined in
Section 424(e) of the Code.
(w)
"Plan" means
this The Female Health Company 2008 Stock Incentive Plan.
(x)
"Restricted
Stock" means an Award of Common Stock granted under Section 10 of this
Plan.
(y) "Rule
16b-3" means
Rule 16b-3 promulgated under the Exchange Act or any successor to
Rule 16b-3, as in effect when discretion is being exercised with respect to
the Plan.
(z) "Section
16(b) " means
Section 16(b) of the Exchange Act.
(aa) "Service
Provider"
means an Employee, Officer, Director or Consultant.
(bb) "Significant
Stockholder" means an individual who, within the meaning of Section
422(b)(6) of the Code, owns stock possessing more than ten percent of the total
combined voting power of all classes of stock of the Company. In
determining whether an individual is a Significant Stockholder, an individual
shall be treated as owning stock owned by certain relatives of the individual
and certain stock owned by corporations in which the individual is a partner,
and estates or trusts of which the individual is a beneficiary, all as provided
in Section 424(d) of the Code.
(cc) "Stock
Appreciation
Right" means a right granted under Section 9 of this
Plan.
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(dd)
"Subsidiary"
means a "subsidiary corporation," whether now or hereafter existing, as defined
in Section 424(f) of the Code.
3.
Stock Subject to the Plan. Shares
of Common Stock which may be issued pursuant to Awards granted under the Plan
may be either authorized and unissued shares of Common Stock or authorized
and
issued shares of Common Stock held by the Company as treasury
stock. Subject to the provisions of Section 12 of the Plan, the
maximum aggregate number of shares of Common Stock that may be issued under
the
Plan is 2,000,000 shares. If any shares of Common Stock cease to
be subject to an Option because such Option expires or becomes unexercisable
without having been exercised in full, if any shares of Common Stock that are
subject to a Restricted Stock Award are forfeited or if any Option or other
Award otherwise terminates without a payment being made to the participant
in
the form of Common Stock, such shares shall again be available for issuance
in
connection with Awards under the Plan.
4.
Administration of the Plan.
(a)
Procedure.
(i)
Rule
16b-3. If the Company has a class of securities registered
under the Exchange Act, to the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption under
Rule 16b-3.
(ii)
Section 409A. All
Awards of Options and Stock Appreciation Rights under this Plan shall be
structured, determined and interpreted to meet the requirements of applicable
Treasury Regulations promulgated under Code Section 409A in order to be exempt
from Code Section 409A.
(iii)
Administration. The
Plan shall be administered by [a] the Board or [b] a Committee
authorized by the Board to administer the Plan, which Committee shall be
constituted to satisfy Applicable Laws.
(b)
Powers of the Administrator. Subject
to the provisions of the Plan, and in the case of a Committee, subject to the
specific duties delegated by the Board to such Committee, the Administrator
shall have the authority, in its sole discretion, from time to
time:
(i) To
determine the Fair Market Value.
(ii) To
select the Service Providers to whom Awards may be granted
hereunder.
(iii) To
determine the number of shares of Common Stock to be covered by each Award
granted hereunder.
(iv) To
approve forms of agreement for use under the Plan.
4
(v) To
determine the terms and conditions, not inconsistent with the terms of the
Plan,
of any Award granted hereunder. Such terms and conditions include, but are
not
limited to, the exercise price, the time or times when Awards may be exercised
or vest (which may be based on performance criteria), any vesting acceleration,
and any restriction or limitation regarding any Award or the shares of Common
Stock relating thereto, based in each case on such factors as the Administrator,
in its sole discretion, shall determine.
(vi) To
determine under what circumstances a Stock Appreciation Right may be settled
in
cash or shares of Common Stock.
(vii) To
construe and interpret the terms of the Plan and Awards granted pursuant to
the
Plan.
(viii)
To prescribe, amend and rescind rules and regulations relating to the Plan,
including rules and regulations relating to sub-plans established for the
purpose of qualifying for preferred tax treatment under foreign tax
laws.
(ix) To
modify or amend each Award (subject to Section 12(c) of the Plan),
including the discretionary authority to extend the post-termination
exercisability period of Awards longer than is otherwise provided for in the
Plan.
(x) To
authorize any person to execute on behalf of the Company any instrument required
to effect the grant of an Award previously granted by the
Administrator.
(xi) To
make all other determinations deemed necessary or advisable for administering
the Plan.
(c)
Effect of Administrator's Decision. The
Administrator's decisions, determinations and interpretations shall be final,
conclusive and binding on all Grantees.
5.
Eligibility. All
of the Company's Service Providers (and any individuals who have accepted an
offer for service as a Service Provider) are eligible to be granted Awards
under
the Plan.
6.
Limitations.
(a)
No Right to Continuing
Relationship. Neither the Plan nor any Award shall confer upon
the Grantee any right with respect to continuing the Grantee's relationship
as a
Service Provider with the Company, nor shall they interfere in any way with
the
Grantee's right or the Company's right to terminate such relationship at any
time, with or without cause.
(b)
Section 162(m)
Limitations. The following limitations shall apply to grants
of Awards under this Plan:
(i) No
individual Grantee shall be granted, in any fiscal year of the Company, Awards
with respect to more than 500,000 shares of Common Stock in total.
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(ii) The
foregoing limitation shall be adjusted proportionately in connection with any
change in the Company's capitalization as described in Section
12(a).
(iii) If
an Award is cancelled in the same fiscal year of the Company in which it was
granted (other than in connection with a transaction described in Section 12),
the cancelled Award will be counted against the limit set forth in Section
6(b)(i) above. For this purpose, if the exercise price of an Option is reduced
(subject to Section 14), the transaction will be treated as a cancellation
of
the Option and the grant of a new Option.
(c)
Incentive Stock
Options. In the cases of Incentive Stock Options, the total
Fair Market Value (determined at the date of grant) of shares of Common Stock
with respect to which Incentive Stock Options are exercisable for the first
time
by the Grantee during any calendar year under all plans of the Company under
which Incentive Stock Options may be granted (and all such plans of any Parent
and any Subsidiary) shall not exceed $100,000. (Hereinafter, this
requirement is sometimes referred to as the "$100,000
Limitation.") Nothing in this Section shall be deemed to prevent the
grant of Options permitting exercise in excess of the maximums established
hereby where such excess amount is treated as a Nonstatutory
Option.
7.
Term of Plan. Subject
to Section 16 of the Plan, the Plan shall become effective upon its adoption
by
the Board. It shall continue in effect for a term of ten years unless
terminated earlier under Section 12 of the Plan. Any Awards
outstanding at the end of such period shall remain in effect in accordance
with
their terms.
8.
Options.
(a)
Grant
Agreement. As determined by the Administrator on the date of
grant, each Option shall be evidenced by the Grant Agreement in a form to be
established by the Administrator that specifies: the term of the
Option; the number of shares of Common Stock for which the Option is
exercisable; the exercise price; any vesting or other restrictions which the
Administrator may impose; whether the Option is an Incentive Stock Option or
a
Nonstatutory Option; in the case of an Incentive Stock Option, a provision
implementing the $100,000 Limitation; and any other terms and conditions as
shall be determined by the Administrator at the time of grant of the
Option. All Grant Agreements shall incorporate the provisions of this
Plan by reference.
(b)
Exercise
Price. The per share exercise price for the shares of Common
Stock to be issued pursuant to exercise of an Option shall be determined by
the
Administrator, but shall never be less than Fair Market Value on the date the
Option is granted. Incentive Stock Options granted to Significant
Stockholders shall have an exercise price of not less than 110% of Fair Market
Value on the date the Incentive Stock Option is granted.
(c)
Waiting Period and
Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised
and
shall determine any conditions that must be satisfied before the Option may
be
exercised. No Option may have a term of more than ten years from the
date of grant.
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(d)
Form of
Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. Such consideration may consist entirely of:
(i) cash;
(ii) check;
(iii) consideration
received by the Company under a cashless exercise program implemented by the
Company in connection with the Plan;
(iv) any
combination of the foregoing methods of payment; or
(v) such
other consideration and method of payment for the issuance of shares of Common
Stock to the extent permitted by Applicable Laws.
(e)
Exercise of Option.
(i)
Procedure for Exercise;
Rights as a Shareholder. Any Option granted hereunder shall be
exercisable according to the terms of the Plan and at such times and under
such
conditions as are determined by the Administrator and set forth in the Grant
Agreement. Unless the Administrator provides otherwise, vesting of
Options granted hereunder shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a
share.
An
Option
shall be deemed exercised when the Company receives: [a] written
or electronic notice of exercise (in accordance with the Grant Agreement) from
the person entitled to exercise the Option, and [b] full payment for the
shares of Common Stock with respect to which the Option is
exercised. Full payment may consist of any consideration and method
of payment authorized by the Administrator and permitted by the Grant Agreement
and the Plan. Shares issued upon exercise of an Option shall be
issued in the name of the Grantee or, if requested by the Grantee, in the name
of the Grantee and his or her spouse. Until the shares are issued (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends
or any other rights as a shareholder shall exist with respect to the Common
Stock subject to the Option, notwithstanding the exercise of the
Option. The Company shall issue (or cause to be issued) such shares
promptly after the Option is exercised. No adjustment will be made
for a dividend or other right for which the record date is prior to the date
the
shares are issued, except as provided in Section 12 of the
Plan.
Exercising
an Option in any manner shall decrease the number of shares of Common Stock
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of shares of Common Stock as to which the Option is
exercised.
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(ii)
Termination of
Relationship as a Service Provider. If a Grantee ceases to be
a Service Provider, other than upon the Grantee's death or Disability,
retirement after age 55 or termination for Cause, the Grantee may exercise
his
or her Option within such period of time as is specified in the Grant Agreement
to the extent that the Option is vested on the date of termination (but in
no
event later than the expiration of the term of such Option as set forth in
the
Grant Agreement). In the absence of a specified time in the Grant
Agreement, the Option shall remain exercisable for three months following the
Grantee's termination. If, on the date of termination, the Grantee is
not vested as to his or her entire Option, the shares of Common Stock covered
by
the unvested portion of the Option shall revert to the Plan. If,
after termination, the Grantee does not exercise his or her Option within the
time specified herein, the Option shall terminate, and the shares of Common
Stock covered by such Option shall revert to the Plan.
(iii)
Disability or
Retirement of Grantee. If a Grantee ceases to be a Service
Provider as a result of the Grantee's Disability or the Grantee's retirement
after age 55, the Grantee may exercise his or her Option within such period
of
time as is specified in the Grant Agreement to the extent the Option is vested
on the date of termination (but in no event later than the expiration of the
term of such Option as set forth in the Grant Agreement). In the
absence of a specified time in the Grant Agreement, the Option shall remain
exercisable for twelve months following the Grantee's
termination. If, on the date of termination, the Grantee is not
vested as to his or her entire Option, the shares of Common Stock covered by
the
unvested portion of the Option shall revert to the Plan. If, after
termination, the Grantee does not exercise his or her Option within the time
specified herein, the Option shall terminate, and the shares of Common Stock
covered by such Option shall revert to the Plan.
(iv)
Death of Grantee. If
a Grantee dies while a Service Provider, the Option may be exercised within
such
period of time as is specified in the Grant Agreement (but in no event later
than the expiration of the term of such Option as set forth in the Grant
Agreement), by the Grantee's estate or by a person who acquires the right to
exercise the Option by bequest or inheritance, but only to the extent that
the
Option is vested on the date of death. In the absence of a specified
time in the Grant Agreement, the Option shall remain exercisable for twelve
months following the Grantee's death. If, at the time of death, the
Grantee is not vested as to his or her entire Option, the shares of Common
Stock
covered by the unvested portion of the Option shall immediately revert to the
Plan. The Option may be exercised by the executor or administrator of
the Grantee's estate or, if none, by the person(s) entitled to exercise the
Option under the Grantee's will or the laws of descent or
distribution. If the Option is not so exercised within the time
specified herein, the Option shall terminate, and the shares of Common Stock
covered by such Option shall revert to the Plan.
(v)
Termination for
Cause. If a Grantee ceases to be a Service Provider as a
result of a termination for Cause, any Option or Options held by him or her
under the Plan, to the extent not exercised before such termination, shall
forthwith terminate and the number of shares covered by such Option shall revert
to the Plan.
(vi)
Buy-out
Provisions. The Administrator may at any time offer to buy out
for a payment in cash or shares of Common Stock an Option previously granted
based on such terms and conditions as the Administrator shall establish and
communicate to the Grantee at the time that such offer is made.
8
9.
Stock Appreciation
Rights.
(a)
Grant and
Exercise. Stock Appreciation Rights may be granted alone (and
not in conjunction with any Option granted under the Plan), at any time and
from
time to time as determined by the Administrator.
(b)
Terms and
Conditions. Stock Appreciation Rights shall be subject to such
terms and conditions as shall be determined by the Administrator, including
the
following:
(i)
As determined by the Administrator on the date of grant, each Stock Appreciation
Right shall be evidenced by the Grant Agreement in a form to be established
by
the Administrator that specifies the exercise price, term, conditions of
exercise and such other terms as the Administrator shall determine. All Grant
Agreements shall incorporate the provisions of this Plan by reference. No Stock
Appreciation Right may have a term of more than ten years from the date of
grant.
(ii)
The per share exercise price of a Stock Appreciation Right shall be determined
by the Administrator, but shall never be less than Fair Market Value on the
date
the Stock Appreciation Right is granted.
(iii)
Upon exercise of a Stock Appreciation Right, a Grantee will be entitled to
receive payment from the Company in an amount determined by multiplying
(A) the difference between the Fair Market Value on the date of exercise
over the exercise price of the Stock Appreciation Right, times (B) the
number of shares of Common Stock with respect to which the Stock Appreciation
Right is exercised. At the discretion of the Administrator, payment
upon exercise of a Stock Appreciation Right may be made in cash, in shares
of
Common Stock (based on the Fair Market Value on the date of exercise), or in
some combination thereof.
(iv)
The Administrator may at any time offer to buy out for a payment in cash or
shares of Common Stock a Stock Appreciation Right previously granted based
on
such terms and conditions as the Administrator shall establish and communicate
to the Grantee at the time that such offer is made.
(c)
Exercise of a Stock
Appreciation Right.
(i)
Procedure for Exercise. Any
Stock Appreciation Right granted hereunder shall be exercisable according to
the
terms of the Plan and at such times and under such conditions as are determined
by the Administrator and set forth in the Grant Agreement. Unless the
Administrator provides otherwise, to the extent applicable, vesting of Stock
Appreciation Rights granted hereunder shall be tolled during any unpaid leave
of
absence. If applicable, a Stock Appreciation Right may not be
exercised for a fraction of a share.
A
Stock
Appreciation Right shall be deemed exercised when the Company receives written
or electronic notice of exercise (in accordance with the Grant Agreement) from
the person entitled to exercise the Stock Appreciation Right. If
applicable, shares issued upon exercise of a Stock Appreciation Right shall
be
issued in the name of the Grantee or, if requested by the Grantee, in the name
of the Grantee and his or her spouse. If applicable, until the shares
are issued (as evidenced by the appropriate entry on the books of the Company
or
of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to
the
Common Stock subject to the Stock Appreciation Right, notwithstanding the
exercise of the Stock Appreciation Right. If applicable, the Company
shall issue (or cause to be issued) such shares promptly after the Stock
Appreciation Right is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the
shares are issued, except as provided in Section 12 of the
Plan.
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(ii)
Termination of
Relationship as a Service Provider. If a Grantee ceases to be
a Service Provider, other than upon the Grantee's death or Disability,
retirement after age 55 or termination for Cause, the Grantee may exercise
his
or her Stock Appreciation Right within such period of time as is specified
in
the Grant Agreement to the extent that the Stock Appreciation Right is vested
on
the date of termination (but in no event later than the expiration of the term
of such Stock Appreciation Right as set forth in the Grant
Agreement). In the absence of a specified time in the Grant
Agreement, the Stock Appreciation Right shall remain exercisable for three
months following the Grantee's termination. If, on the date of
termination, the Grantee is not vested as to his or her entire Stock
Appreciation Right, any shares of Common Stock covered by the unvested portion
of the Stock Appreciation Right shall revert to the Plan. If, after
termination, the Grantee does not exercise his or her Stock Appreciation Right
within the time specified herein, the Stock Appreciation Right shall terminate,
and any shares of Common Stock covered by such Stock Appreciation Right shall
revert to the Plan.
(iii)
Disability or
Retirement of Grantee. If a Grantee ceases to be a Service
Provider as a result of the Grantee's Disability or the Grantee's retirement
after age 55, the Grantee may exercise his or her Stock Appreciation Right
within such period of time as is specified in the Grant Agreement to the extent
the Stock Appreciation Right is vested on the date of termination (but in no
event later than the expiration of the term of such Stock Appreciation Right
as
set forth in the Grant Agreement). In the absence of a specified time
in the Grant Agreement, the Stock Appreciation Right shall remain exercisable
for twelve months following the Grantee's termination. If, on the
date of termination, the Grantee is not vested as to his or her entire Stock
Appreciation Right, any shares of Common Stock covered by the unvested portion
of the Stock Appreciation Right shall revert to the Plan. If, after
termination, the Grantee does not exercise his or her Stock Appreciation Right
within the time specified herein, the Stock Appreciation Right shall terminate,
and any shares of Common Stock covered by such Stock Appreciation Right shall
revert to the Plan.
(iv)
Death of Grantee. If
a Grantee dies while a Service Provider, the Stock Appreciation Right may be
exercised within such period of time as is specified in the Grant Agreement
(but
in no event later than the expiration of the term of such Stock Appreciation
Right as set forth in the Grant Agreement), by the Grantee's estate or by a
person who acquires the right to exercise the Stock Appreciation Right by
bequest or inheritance, but only to the extent that the Stock Appreciation
Right
is vested on the date of death. In the absence of a specified time in
the Grant Agreement, the Stock Appreciation Right shall remain exercisable
for
twelve months following the Grantee's death. If, at the time of
death, the Grantee is not vested as to his or her entire Stock Appreciation
Right, any shares of Common Stock covered by the unvested portion of the Stock
Appreciation Right shall immediately revert to the Plan. The Stock
Appreciation Right may be exercised by the executor or administrator of the
Grantee's estate or, if none, by the person(s) entitled to exercise the Stock
Appreciation Right under the Grantee's will or the laws of descent or
distribution. If the Stock Appreciation Right is not so exercised
within the time specified herein, the Stock Appreciation Right shall terminate,
and any shares of Common Stock covered by such Stock Appreciation Right shall
revert to the Plan.
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(v)
Termination for
Cause. If a Grantee ceases to be a Service Provider as a
result of a termination for Cause, any Stock Appreciation Right or rights held
by him or her under the Plan, to the extent not exercised before such
termination, shall forthwith terminate and any shares of Common Stock covered
by
such Stock Appreciation Right shall revert to the Plan.
10.
Restricted
Stock.
(a)
Grant of Restricted
Stock. Subject to Section 3, shares of Restricted Stock may be
granted to Service Providers at any time and from time to time as determined
by
the Administrator. The Administrator shall have complete discretion
in determining the number of shares of Restricted Stock granted to each Grantee,
the time or times within which such Awards may be subject to forfeiture and
any
other terms and conditions of the Awards, in addition to those contained in
Section 10(c). The Administrator may condition the grant of
Restricted Stock upon the attainment of specified performance goals or such
other factors or criteria as the Administrator shall determine. The
provisions of Restricted Stock Awards need not be the same with respect to
each
Grantee. In making such determinations, the Administrator may take
into account the nature of services rendered by such Service Provider, their
present and potential contributions to the Company, and such other factors
as
the Administrator in its discretion shall deem relevant. The
Administrator may grant a Restricted Stock Award without vesting or other
restrictions or forfeiture provisions.
(b)
Awards and
Certificates. Each Service Provider receiving an Award of
Restricted Stock shall be issued a certificate in respect of such shares of
Restricted Stock. Such certificate shall be registered in the name of
such Grantee and shall, if applicable, bear an appropriate legend referring
to
the terms, conditions, and restrictions applicable to such Award, substantially
in the following form:
"The
transferability of this
certificate and the shares of stock represented hereby are subject to the terms
and conditions (including forfeiture) of The Female Health Company 2008 Stock
Incentive Plan and a Restricted Stock Agreement. Copies of such Plan
and Agreement are on file at the offices of The Female Health Company, 515
North
State Street, Chicago, Illinois60610."
The
Administrator may require that the
certificates evidencing such shares be held in custody by the Company until
the
restrictions thereon shall have lapsed and that, as a condition of any Award
of
Restricted Stock, the Grantee shall have delivered a stock power, endorsed
in
blank, relating to the Common Stock covered by such Award.
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(c)
Terms and
Conditions. Shares of Restricted Stock shall be subject to the
following terms and conditions:
(i)
Subject to the provisions of the Plan and the Grant Agreement, during a period,
if any, set by the Administrator, commencing with the date of such Award (the
"Restriction Period"), the Grantee shall not be permitted to sell, assign,
transfer, pledge or otherwise encumber shares of Restricted Stock. Within these
limits, the Administrator may provide for the lapse of such restrictions in
installments and may accelerate or waive such restrictions, in whole or in
part,
based on service, performance and such other factors or criteria as the
Administrator may determine.
(ii)
Except as provided in this Section and Section 10(c)(i), the Grantee shall
have,
with respect to the shares of Restricted Stock, all of the rights of a
shareholder of the Company, including the right to vote the shares and the
right
to receive any cash dividends. Unless otherwise determined by the Administrator,
cash dividends shall be automatically deferred and reinvested in additional
Restricted Stock and dividends payable in Common Stock shall be paid in the
form
of Restricted Stock.
(iii)
Except to the extent otherwise provided in the applicable Grant Agreement and
Sections 10(c)(i) and (iv), upon termination of a Grantee's employment or other
relationship with the Company for any reason during the Restriction Period,
all
shares still subject to restriction shall be forfeited by the
Grantee.
(iv)
In the event of hardship or other special circumstances of a Grantee whose
employment or other relationship is involuntarily terminated (other than for
Cause), the Administrator may waive in whole or in part any or all remaining
restrictions with respect to such Grantee's shares of Restricted
Stock.
(v)
If and when the Restriction Period expires without a prior forfeiture of the
Restricted Stock subject to such Restriction Period, unlegended certificates
for
such shares shall be delivered to the Grantee.
(vi)
As determined by the Administrator on the date of grant, each Award of
Restricted Stock shall be evidenced by the Grant Agreement in a form to be
established by the Administrator that specifies: the duration of the Restricted
Period, if any; the number of shares of Restricted Stock granted; any vesting
or
other restrictions which the Administrator may impose, and any other terms
and
conditions as shall be determined by the Administrator at the time of grant
of
the Restricted Stock. All Grant Agreements shall incorporate the provisions
of
this Plan by reference.
11.
Nontransferability of Awards. Unless
determined otherwise by the Administrator, an Option or Stock Appreciation
Right
may not be sold, pledged, assigned, hypothecated, transferred or disposed of
in
any manner other than by will or by the laws of descent or distribution and
may
be exercised, during the lifetime of the Grantee, only by the
Grantee. If the Administrator makes an Option or Stock Appreciation
Right transferable, such Option or Stock Appreciation Right shall contain such
additional terms and conditions as the Administrator deems
appropriate.
12
12.
Adjustments Upon Changes in Capitalization,
Dissolution, or Acquisition of the Company.
(a)
Changes in
Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option or Stock Appreciation Right, and the number of shares
of
Common Stock which have been authorized for issuance under the Plan but as
to
which no Awards have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Award, as well as the price per share
of
Common Stock covered by each Option or Stock Appreciation Right, shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company; provided, however, that
conversion of any convertible securities of the Company shall not be deemed
to
have been "effected without receipt of consideration." Such
adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuance by the Company of shares of stock of any class,
or
securities convertible into shares of stock of any class, shall affect, and
no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Award.
(b)
Acquisitions. In
the event that an Acquisition (as defined below) occurs with respect to the
Company, the Administrator shall, in its sole discretion, have authority to
provide for (i) waiver in whole or in part of any remaining restrictions or
vesting requirements in connection with any Award granted hereunder, (ii) the
conversion of each outstanding Award into cash equal to a reasonable, good
faith
estimate of an amount (hereinafter the "Spread") equal to the difference between
the net amount per share payable in the Acquisition, or as a result of the
Acquisition, less the exercise price per share, if any, of the Award and/or
(iii) the conversion of outstanding Awards into the right to receive securities
of another entity upon such terms and conditions as are determined by the
Administrator in its discretion. In estimating the Spread,
appropriate adjustments to give effect to the existence of the Awards shall
be
made, such as deeming the Options to have been exercised, with the Company
receiving the exercise price payable thereunder, if applicable, and treating
the
shares receivable upon exercise of the Options and Stock Appreciation Rights
as
being outstanding in determining the net amount per share. For
purposes of this Section, an "Acquisition" shall mean any transaction in which
substantially all of the Company's assets are acquired or in which a controlling
amount of the Company's outstanding shares are acquired, in each case by a
single person or entity or an affiliated group of persons and/or entities
regardless of how the Acquisition is effectuated, whether by direct purchase,
through a merger or similar corporate transaction, or otherwise. For
purposes of this Section a controlling amount shall mean more than 50% of the
issued and outstanding shares of stock of the Company. In cases where
the Acquisition consists of the acquisition of assets of the Company, the net
amount per share shall be calculated on the basis of the net amount receivable
with respect to shares upon a distribution and liquidation by the Company after
giving effect to expenses and charges, including but not limited to taxes,
payable by the Company before the liquidation can be completed.
13
(c)
Dissolution or
Liquidation. Subject to Section 12(b) above, in the event of
the proposed dissolution or liquidation of the Company, the Administrator shall
notify each Grantee as soon as practicable prior to the effective date of such
proposed transaction. The Administrator in its discretion may provide
for a Grantee to have the right to exercise his or her Options and/or Stock
Appreciation Rights until ten days prior to such transaction as to all of the
Common Stock covered thereby, including shares of Common Stock as to which
the
Option or Stock Appreciation Right would not otherwise be
exercisable. In addition, the Administrator may provide that any
Company repurchase option applicable to any shares of Common Stock purchased
upon exercise of an Option or Stock Appreciation Right shall lapse as to all
such shares, provided the proposed dissolution or liquidation takes place at
the
time and in the manner contemplated. To the extent it has not been
previously exercised, an Option or Stock Appreciation Right will terminate
immediately prior to the consummation of such proposed action.
13.
Date of
Grant. The date of grant of an Award shall be, for all
purposes, the date on which the Administrator makes the determination granting
such Award, or such other later date as is determined by the
Administrator. Notice of the determination shall be provided to each
Grantee within a reasonable time after the date of such grant.
14.
Repricing. Except
for adjustments pursuant to Section 12, neither the per share price for any
Option granted pursuant to Section 8 or the per share grant price for any Stock
Appreciation Right granted pursuant to Section 9 may be decreased after the
date
of grant nor may an outstanding Option or an outstanding Stock Appreciation
Right be surrendered to the Company as consideration for the grant of a new
Option or new Stock Appreciation Right with a lower exercise price without
the
approval of the Company's shareholders.
15.
Amendment and Termination of the Plan.
(a)
Amendment and
Termination. The Board may at any time amend, alter, suspend
or terminate the Plan.
(b)
Shareholder
Approval. The Company shall obtain shareholder approval of any
Plan amendment to the extent necessary and desirable to comply with Applicable
Laws.
(c)
Effect of Amendment or Termination. No
amendment, alteration, suspension or termination of the Plan shall impair the
rights of any Grantee, unless mutually agreed otherwise between the Grantee
and
the Administrator, which agreement must be in writing and signed by the Grantee
and the Company. Termination of the Plan shall not affect the
Administrator's ability to exercise the powers granted to it hereunder with
respect to Awards granted under the Plan prior to the date of such
termination.
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16.
Conditions Upon Issuance of Shares.
(a)
Legal
Compliance. Shares shall not be issued pursuant to the
exercise of an Award unless the exercise of such Award and the issuance and
delivery of such shares shall comply with Applicable Laws and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.
(b)
Investment
Representations. As a condition to the exercise of an Award,
the Company may require the person exercising such Award to represent and
warrant, if applicable, at the time of any such exercise that the shares of
Common Stock are being purchased only for investment and without any present
intention to sell or distribute such shares if, in the opinion of counsel for
the Company, such a representation is required.
17.
Inability to Obtain
Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by
the
Company's counsel to be necessary to the lawful issuance and sale of any shares
of Common Stock hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such shares as to which such requisite authority
shall not have been obtained.
18.
Reservation of Shares. The
Company, during the term of this Plan, will at all times reserve and keep
available such number of shares of Common Stock as shall be sufficient to
satisfy the requirements of the Plan.
19.
Shareholder
Approval. The Plan shall be subject to approval by the
shareholders of the Company within 12 months after the date the Plan is
adopted. Such shareholder approval shall be obtained in the manner
and to the degree required under Applicable Laws.
15
Dates Referenced Herein and Documents Incorporated by Reference
