PLATO LEARNING, INC. 2006 STOCK INCENTIVE PLAN STOCK APPRECIATION RIGHTS AGREEMENT
Exhibit 10.14
PLATO LEARNING, INC.
2006 STOCK INCENTIVE PLAN
2006 STOCK INCENTIVE PLAN
PLATO Learning, Inc., a Delaware corporation (the “Company”), hereby grants to
[(Name)] (the “Participant”) on this [(Date)] (the “Grant Date”) an Award
of [(Number)] stock appreciation rights (“SARs”) pursuant to the provisions of the
PLATO Learning, Inc. 2006 Stock Incentive Plan (the “Plan”). Each SAR represents a
contingent right to receive shares of the Company’s common stock, $.01 par value
(“Shares”), in the future based upon the appreciation in value of the Share underlying each
SAR above [(Price)] (the “Xxxxx Xxxxx”), subject to the terms and conditions set
forth in this Agreement (this “Agreement”). Any term capitalized herein but not defined
will have the meaning set forth in the Plan.
The Award of any SAR pursuant to this Agreement become null and void unless the Participant
shall accept this Agreement by executing it in the space provided below and return it to the
Company within 30 days following the Grant Date.
2.1 Maximum Term of SARs. In no event may a SAR be exercised, in whole or in part,
after 5:00 p.m., Minneapolis time, on the date that is eight (8) years after the Grant Date (the
“Expiration Date”).
2.2 Vesting of SARs. The SARs will vest and become exercisable as to one-fourth of
the Shares to which the SARs relate on each of the first four anniversaries of the Grant Date,
contingent upon the Participant having provided continuous Service to the Company or an Affiliate
from the Grant Date through each such anniversary. Any SARs that are not vested upon the
termination of the Participant’s Service shall be forfeited.
2.3 Method of Exercise and Distribution of SARs. The SARs may be exercised by written
notice to the Company indicating the number of Shares to which the SARs relate being exercised.
When a SAR is vested and exercisable, it may be exercised in whole or in part at any time as to any
or all full Shares under the SAR. Any amount due to the Participant upon exercise of a SAR will be
paid in Shares with a Fair Market Value equal to the amount, if any, by which the Fair Market Value
of a Share on the date of exercise exceeds the Xxxxx Xxxxx of the SAR, rounded down to the nearest
whole Share. The Participant will not receive a distribution if the Fair Market Value on the date
of exercise does not exceed the Xxxxx Xxxxx.
2.4 Termination of SAR. Each vested SAR shall terminate and shall cease to be
exercisable as follows:
(a) In the event of the Participant’s death or Disability, SARs may be exercised as provided
in the Plan no later than 12 months from the date of such death or, if earlier, the Expiration
Date;
(b) In the event the Participant’s Service terminates by reason of Retirement, SARs may be
exercised no later than 36 months from the date of such termination of Service or, if earlier, the
Expiration Date;
(c) In the event the Participant terminates Service for any reason other than death,
Disability, or Retirement, SARs may be exercised no later than 90 days from the date of such
termination of Service or, if earlier, the Expiration Date.
2.5 Withholding Taxes. The Company will have the right to deduct or withhold, or
require the Participant to remit to the Company, the minimum amount necessary to satisfy federal,
state and local taxes, domestic or foreign, as required by law or regulation to be withheld with
respect to any taxable event arising under this Plan, including by withholding Shares otherwise
distributable to the Participant pursuant to this Agreement.
If the Participant breaches any non-disclosure, non-compete, non-solicitation provisions
pursuant to Sections 3.1, 3.2 and 3.3 or other provisions of this Agreement, whether during or
after termination of Service, in addition to any other penalties or restrictions that may apply
under any employment agreement, state law, or otherwise, the Participant will: (a) forfeit any and
all SARs granted to him or her under this Agreement, including SARs that have become vested and
exercisable; and (b) forfeit the profit the Participant has realized on the exercise of any SAR
pursuant to this Agreement that the Participant exercised after terminating Service or within the
six month period immediately preceding the Participant’s termination of Service (the Participant
shall be required to repay such difference to the Company). In the event that the Participant
shall forfeit rights to any Shares to which the SARs relate, the Participant shall, within 10 days
of the date of the Company’s written request, return this Agreement to the Company for
cancellation.
3.1 Non-Disclosure. Participant agrees not to directly or indirectly, without the
Company’s prior written consent: (i) use or disclose, for the benefit of any person, firm or entity
other than the Company and its subsidiaries, the Confidential Business Information of the Company
or any of its subsidiaries; (ii) distribute or disseminate in any way to any person, firm or
entity anyone other than the Company and its subsidiaries, any Confidential Business Information in
any form whatsoever; (iii) copy any Confidential Business Information other than for use by the
Company or any of its subsidiaries; (iv) remove any Confidential Business Information from the
premises of the Company; (v) fail to safeguard all confidential documents; and (vi) copy any
confidential documents belonging to any of the Company’s customers. For purposes of this
Agreement, “Confidential Business Information” means information or material that is not generally
available to or used by others or the utility or value of which is not generally known or
recognized as a standard practice, whether or not the underlying details are in the
public domain, including but not limited to its computerized and manual systems, procedures,
reports, client lists, review criteria and methods, financial methods and practices, plans, pricing
and marketing techniques, business methods and procedures and other valuable and proprietary
information relating to the pricing, marketing, design, manufacture and formulation of educational
software, as well as information regarding the past, present and prospective clients of the Company
or any of its subsidiaries, and their particular needs and requirements, and their own confidential
information. Upon termination of employment for any reason, Participant agrees to return to the
Company all policy and procedure manuals, records, notes, data, memoranda, and reports of any
nature (including computerized and electronically stored information) which are in Participant’s
possession and/or control which relate to (i) the Confidential Business Information of the Company
or any of its subsidiaries, (ii) the business activities or facilities of the Company or its past,
present, or prospective clients.
3.3 Non-Compete. During the period of Participant’s Service and for a period of one
(1) year following termination of this Agreement and Participant’s employment for any reason (the
“Restricted Period”), Participant will not directly or indirectly, on his or her behalf, or as a
partner, officer, director, trustee, member, employee, or otherwise, within the United States or in
any foreign market in which Participant was engaged in activities on behalf of the Company or any
of its subsidiaries, own, engage in or participate in, in any way, any business that is similar to
or competitive with any actual or planned business activity engaged in or planned by the Company or
any of its subsidiaries at the time the Participant was terminated. However, this Agreement shall
not prohibit ownership by Participant of up to 2% of the shares of stock of any corporation the
stock of which is listed on a national securities exchange or is traded in the over-the-counter
market.
3.4 Non-Solicitation. During the Restricted Period, Participant will not directly or
indirectly, for the purpose of selling services and/or products provided or planned by the Company
or any of its subsidiaries at the time the Participant’s employment was terminated, call upon,
solicit or divert any actual customer or prospective customer of the Company or any of its
subsidiaries, unless employed by the Company to do so. An actual customer, for purposes of this
Section, is any customer to whom the Company or any of its subsidiaries has provided services
and/or products within one year prior to Participant’s termination of employment. A prospective
customer, for purposes of this Section, is any prospective customer to whom the Company or any of
its subsidiaries sought to provide services and/or products within one year prior to the date of
Participant’s termination of employment when Participant had knowledge of or was involved in such
solicitation. Participant further agrees that during the Restricted Period Participant shall not
directly or indirectly induce any person to leave the employ of the Company or any of its
subsidiaries, or solicit any person who is currently or was an employee of the Company or any of
its subsidiaries at any time during the twelve months prior to Participant’s termination of
employment.
3.5 Judicial Modification. If the final judgment of a court of competent jurisdiction
declares that any term or provision of this Agreement is invalid or unenforceable, the parties
agree that (i) the court making the determination of invalidity or unenforceability shall have the
power to reduce the scope, duration, or geographic area of the term or provision, to delete
specific words or phrases, or to replace any invalid or unenforceable term or provision with a term
or provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision, (ii) the parties shall request
that the court exercise that power, and (iii) this Agreement shall be enforceable as so modified
after the expiration of the time within which the judgment or decision may be appealed.
(a) The SARs awarded under this Agreement are not exercisable in whole or in part, if exercise
may, in the opinion of counsel for the Company, violate the 1933 Act (or other federal or state
statutes having similar requirements), as it may be in effect at that time, or cause the Company to
violate the terms of Section 4.1 of the Plan.
(b) The SARs are subject to the further requirement that, if at any time the Committee
determines in its discretion that the registration, listing or qualification of the Shares subject
to the SARs under any federal securities law, securities exchange requirements or under any other
applicable law, or the consent or approval of any governmental regulatory body, is necessary as a
condition of, or in connection with, the granting of a SAR, the SAR may not be exercised in whole
or in part, unless the necessary registration, listing, qualification, consent or approval has been
effected or obtained free of any conditions not acceptable to the Committee.
(c) With respect to individuals subject to Section 16 of the Exchange Act, transactions under
this Agreement are intended to comply with all applicable conditions of Rule 16b-3, or its
successors under the Exchange Act. To the extent any provision of the Agreement or action by the
Committee fails to so comply, the Committee may determine, to the extent permitted by law, that the
provision or action will be null and void.
12. Governing Law. This Agreement and the SARs will be construed and enforced in
accordance with, and governed by, the laws of the State of Delaware, determined without regard to
its conflict of law rules.
PLATO LEARNING, INC. |
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By: | ||||
Xxxxxxx X. Xxxxxxx | ||||
President and Chief Executive Officer | ||||
Accepted this day of
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