As
filed with the Securities and Exchange Commission on May 28, 2015
Registration
No. 333-_____
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM S-8
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
OCEAN
BIO-CHEM, INC.
(Exact
name of Registrant as specified in its charter)
Florida |
|
59-1564329 |
(State
or other jurisdiction of incorporation or organization) |
|
(I.R.S.
Employer Identification Number) |
|
|
|
4041
SW 47 Avenue, Ft. Lauderdale, FL |
|
33314 |
(Address
of Principal Executive Offices) |
|
(Zip
Code) |
Ocean
Bio-Chem, Inc., 2015 Equity Compensation Plan
(Full
title of the plan)
Peter
G. Dornau
Chairman
of the Board, President and Chief Executive Officer
Ocean
Bio-Chem, Inc.
4041
SW 47 Avenue
Ft.
Lauderdale, FL 33314
954-587-6280
(Name,
address and telephone number, including area code, of agent for service)
with
a copy to:
Alan
Singer
Morgan,
Lewis & Bockius LLP
1701
Market Street
Philadelphia,
PA 19103-2921
Indicate
by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
|
Large
accelerated filer |
☐ |
Accelerated
filer |
☐ |
|
Non-accelerated
filer |
☐ |
Smaller
reporting company |
☒ |
CALCULATION
OF REGISTRATION FEE
| |
| |
Proposed | | |
Proposed | | |
| |
Title of | |
| |
maximum | | |
maximum | | |
| |
securities | |
| |
offering | | |
aggregate | | |
Amount of | |
to be | |
Amount to be | |
price per | | |
offering | | |
registration | |
registered | |
registered | |
share (1) | | |
price | | |
fee | |
| |
| |
| | | |
| | | |
| | |
Common Stock, $0.01 par value (1) | |
630,000 shares(2) | |
$4.005 | | |
$2,523,150 | | |
$294 | |
| (1) | Calculated
pursuant to Rule 457(h) under the Securities Act of 1933, based upon the average of the
high and low sales prices of the Common Stock of the Registrant reported on The Nasdaq
Stock Market on May 27, 2015. |
| (2) | Pursuant
to Rule 416(a) under the Securities Act of 1933, this Registration Statement also covers
such additional shares as may hereinafter be offered to prevent dilution resulting from
stock splits, stock dividends, recapitalizations or similar transactions. |
PART
II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3.
Incorporation of Documents by Reference.
The
following documents, filed by Ocean Bio-Chem., Inc. (the "Registrant") with the Securities and Exchange Commission (the
"Commission"), are hereby incorporated by reference:
| (a) | Annual
Report on Form 10-K for the fiscal year ended December 31, 2014; |
| (b) | Quarterly
Report on Form 10-Q for the fiscal quarter ended March 31, 2015; and |
| (c) | The
description of the Registrant’s common stock set forth in its Registration Statement filed under the Securities Exchange
Act of 1934, including any amendment or report filed for the purpose of updating such description. |
All
documents filed by the Registrant with the Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange
Act of 1934 after the date of this registration statement and prior to the filing of a post-effective amendment to this registration
statement that indicates that all securities offered by this registration statement have been sold or that deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part of this
registration statement from the date of filing of such document.
Any
statement contained in a document incorporated or deemed to be incorporated by reference or deemed to be part of this registration
statement will be deemed to be modified or superseded for purposes of this registration statement to the extent that a statement
contained in this registration statement or in any other subsequently filed document that also is, or is deemed to be, incorporated
by reference or deemed to be part of this registration statement modifies or replaces such statement. Any statement contained
in a document that is deemed to be incorporated by reference or deemed to be part of this registration statement after the most
recent effective date may modify or replace existing statements contained in this registration statement. Any such statement so
modified or replaced shall not be deemed, except as so modified or replaced, to constitute a part of this registration statement.
Experts
The
financial statements incorporated in this registration statement by reference to the Registrant’s Annual Report on Form
10-K for the year ended December 31, 2014 have been so incorporated in reliance on the report of Goldstein Schechter Koch P.A.,
an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
If
Goldstein Schechter Koch P.A. consents to the incorporation by reference in this registration statement of its report relating
to audited financial statements included in a document subsequently filed by the Registrant, such audited financial statements
shall be incorporated herein in reliance upon such report of Goldstein Schechter Koch P.A., an independent registered public accounting
firm, given on the authority of said firm as experts in auditing and accounting.
Item 4.
Description of Securities.
Not
applicable.
Item 5.
Interests of Named Experts and Counsel.
Not
applicable.
Item 6.
Indemnification of Directors and Officers.
The
Registrant is organized under the laws of the State of Florida. Section 607.0850(1) of the Florida Business Corporation Act ,
as amended (the “FBCA”) provides that a Florida corporation shall have power to indemnify any person who was or is
a party to any proceeding (other than an action by, or in the right of, the corporation), by reason of the fact that he or she
is or was a director, officer, employee, or agent of the corporation or is or was serving at the request of the corporation as
a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against
liability incurred in connection with such proceeding, including any appeal thereof, if he or she acted in good faith and in a
manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any proceeding
by judgment, order, settlement, or conviction or upon a plea of nolo contendere or its equivalent shall not, of itself, create
a presumption that the person did not act in good faith and in a manner which he or she reasonably believed to be in, or not opposed
to, the best interests of the corporation or, with respect to any criminal action or proceeding, had reasonable cause to believe
that his or her conduct was unlawful. Section 607.0850(2) of the FBCA provides that a Florida corporation shall have power to
indemnify any person who was or is a party to any proceeding by or in the right of the corporation to procure a judgment in its
favor by reason of the fact that the person is or was a director, officer, employee, or agent of the corporation or is or was
serving at the request of the corporation as a director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise, against expenses and amounts paid in settlement not exceeding, in the judgment of the board
of directors, the estimated expense of litigating the proceeding to conclusion, actually and reasonably incurred in connection
with the defense or settlement of such proceeding, including any appeal thereof. Such indemnification shall be authorized if such
person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the
corporation, except that no indemnification shall be made under Section 607.0850(2) in respect of any claim, issue, or matter
as to which such person shall have been adjudged to be liable unless, and only to the extent that, the court in which such proceeding
was brought, or any other court of competent jurisdiction, shall determine upon application that, despite the adjudication of
liability but in view of all circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses
which such court shall deem proper.
Section
607.0850(7) of the FBCA provides that the indemnification and advancement of expenses provided pursuant to Section 607.0850 are
not exclusive, and a corporation may make any other or further indemnification or advancement of expenses of any of its directors,
officers, employees, or agents, under any bylaw, agreement, vote of shareholders or disinterested directors, or otherwise, both
as to action in his or her official capacity and as to action in another capacity while holding such office. However, indemnification
or advancement of expenses shall not be made to or on behalf of any director, officer, employee, or agent if a judgment or other
final adjudication establishes that his or her actions, or omissions to act, were material to the cause of action so adjudicated
and constitute:
| (a) | A
violation of the criminal law, unless the director, officer, employee, or agent had reasonable
cause to believe his or her conduct was lawful or had no reasonable cause to believe
his or her conduct was unlawful; |
| (b) | A
transaction from which the director, officer, employee, or agent derived an improper
personal benefit; |
| (c) | In
the case of a director, a circumstance under which the liability provisions of FBCA Section 607.0834
(relating to liability for illegal distributions) are applicable; or |
| (d) | Willful
misconduct or a conscious disregard for the best interests of the corporation in a proceeding
by or in the right of the corporation to procure a judgment in its favor or in a proceeding
by or in the right of a shareholder. |
Section
607.0850(9) of the FBCA provides that, notwithstanding the failure of a corporation to provide indemnification, a director, officer,
employee, or agent of the corporation who is or was a party to a proceeding may apply to a court specified in Section 607.0850(9)
for indemnification or advancement of expenses, or both. The court may, if it makes a determination required under the statute,
order indemnification and advancement of expenses, including expenses incurred in seeking court-ordered indemnification or advancement
of expenses.
Article
XII of the Registrant’s Articles of Incorporation provides that the Registrant shall indemnify any person made a party to
an action by or in the right of the Registrant to procure a judgment in its favor by reason of their being or having been director,
officer or employer of the Registrant, or any other corporation which they served as such at the request of the Registrant, against
the reasonable expenses, including attorneys’ fees, actually and necessarily incurred by them in connection with the defense
or settlement of such action, or in connection with any appeal therein, except in relation to matters as to which such director
or officer is adjudged to have been guilty of negligence or misconduct in the performance of their duty to the Registrant. Article
XII further provides that the Registrant shall indemnify any person made a party to an action, suit or proceeding other than one
by or in the right of the corporation to procure a judgment in its favor, whether civil or criminal, brought to impose a liability
or penalty on such person in their capacity of director, officer or employer of the Registrant, or of any other corporation which
they served as such at the request of the Registrant, against judgments, fines, amounts paid in settlement and reasonable expenses,
including attorneys’ fees, actually and necessarily incurred as a result of such action, suit or proceeding, or any appeal
therein, if such director, officer or employer acted in good faith in the reasonable belief that such action was in the best interests
of the Registrant, and in criminal actions or proceedings, without reasonable ground for belief that such action was unlawful.
The termination of any such civil or criminal action, suit or proceeding by judgment, settlement, conviction or upon a plea or
nolo contendere shall not in itself create a presumption that any such director or officer did not act in good faith in the reasonable
belief that such action was in the best interests of the Registrant or that they had reasonable grounds for belief that such action
was unlawful.
Under
Section 607.0850(12) of the FBCA, a Florida corporation has the power to purchase and maintain insurance on behalf of any person
who is or was a director, officer, employee, or agent of the corporation or is or was serving at the request of the corporation
as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against
any liability asserted against the person and incurred by him or her in any such capacity or arising out of his or her status
as such, whether or not the corporation would have the power to indemnify the person against such liability under the provisions
of Section 607.0850 of the FBCA. The Registrant has obtained directors and officers liability insurance.
Article VII
of the Registrant's Bylaws generally require that directors and officers be indemnified, to the full extent permitted by Florida
law, if the applicable standards permitting indemnification under the FBCA are met.
Item 7.
Exemption From Registration Claimed.
Not
applicable.
Item 8.
Exhibits.
The
file number for each of the Registrant’s filings with the Securities and Exchange Commission referenced below is 0-11102.
Exhibit
No. |
|
Description |
|
|
|
4.1.1 |
|
Articles
of Incorporation, as amended - incorporated by reference to Exhibit 3.1 to the Registrant's Annual Report on Form 10-K
for the year ended December 31, 2010. |
|
|
|
4.1.2 |
|
Articles
of Amendment to the Articles of Incorporation, as filed on June 13, 2012 – incorporated by reference to Exhibit 3.1.2
to the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. |
|
|
|
4.2 |
|
Amended
and Restated Bylaws - incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed
on December 5, 2011. |
|
|
|
5.1 |
|
Opinion
of Morgan, Lewis & Bockius LLP. |
|
|
|
23.1 |
|
Consent
of Goldstein Schechter Koch P.A.. |
|
|
|
23.2 |
|
Consent
of Morgan, Lewis & Bockius LLP (included in Exhibit 5.1). |
|
|
|
24.1 |
|
Power
of Attorney (included on signature page). |
|
|
|
99.1 |
|
Ocean
Bio-Chem, Inc. 2015 Equity Compensation Plan. |
Item 9.
Undertakings.
The
undersigned Registrant hereby undertakes:
| (1) | To
file, during any period in which offers or sales are being made, a post-effective amendment
to this registration statement: |
| (i) | To
include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; |
| (ii) | To
reflect in the prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the information set forth in the
registration statement; |
| (iii) | To
include any material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such information in
the registration statement; |
provided,
however, that Paragraphs (1)(i) and (1)(ii) do not apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in reports filed with or furnished to the Commission by the Registrant pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement.
| (2) | That,
for the purpose of determining any liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof. |
| (3) | To
remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering. |
The
undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion
of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-8 and has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Ft. Lauderdale, State of Florida on May 28, 2015.
|
OCEAN
BIO-CHEM, INC. |
|
|
|
|
By: |
/s/
PETER G. DORNAU |
|
|
Peter
G. Dornau |
|
|
President
and Chief Executive Officer |
POWER
OF ATTORNEY
KNOW
ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints each of Peter G. Dornau and
Jeffrey S. Barocas, the undersigned's true and lawful attorneys-in-fact and agents, with full power of substitution and revocation,
for and in the undersigned's name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective
amendments) to this registration statement, and to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority
to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as the
undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact may lawfully do or cause
to be done by virtue thereof.
Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature |
|
Capacity |
|
Date |
|
|
|
|
|
/s/
JEFFREY S. BAROCAS |
|
Chief
Financial Officer and Director |
|
May
28, 2015 |
Jeffrey
S. Barocas |
|
|
|
|
|
|
|
|
|
/s/
SONIA B. BEARD |
|
Director |
|
May
28, 2015 |
Sonia
B. Beard |
|
|
|
|
(Signatures
continued on next page)
(Signatures
continued from previous page)
Signature |
|
Capacity |
|
Date |
|
|
|
|
|
/s/
DIANA MAZUELOS CONARD |
|
Director |
|
May
28, 2015 |
Diana
Mazuelos Conard |
|
|
|
|
|
|
|
|
|
/s/
GREGOR M. DORNAU |
|
Director |
|
May
28, 2015 |
Gregor
M. Dornau |
|
|
|
|
|
|
|
|
|
/s/
PETER G. DORNAU |
|
Chief
Executive Officer and Director |
|
May
28, 2015 |
Peter
G. Dornau |
|
|
|
|
|
|
|
|
|
/s/
WILLIAM W. DUDMAN |
|
Director |
|
May
28, 2015 |
William
W. Dudman |
|
|
|
|
|
|
|
|
|
/s/
JAMES M. KOLISCH |
|
Director |
|
May
28, 2015 |
James
M. Kolisch |
|
|
|
|
|
|
|
|
|
/s/
JOHN B. TURNER |
|
Director |
|
May
28, 2015 |
John
B. Turner |
|
|
|
|
EXHIBIT
INDEX
Exhibit
No. |
|
Description |
|
|
|
4.1.1 |
|
Articles
of Incorporation, as amended - incorporated by reference to Exhibit 3.1 to the Registrant's Annual Report on Form 10-K
for the year ended December 31, 2010. |
|
|
|
4.1.2 |
|
Articles
of Amendment to the Articles of Incorporation, as filed on June 13, 2012 – incorporated by reference to Exhibit 3.1.2
to the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. |
|
|
|
4.2 |
|
Amended
and Restated Bylaws - incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, filed
on December 5, 2011. |
|
|
|
5.1 |
|
Opinion
of Morgan, Lewis & Bockius LLP. |
|
|
|
23.1 |
|
Consent
of Goldstein Schechter Koch P.A.. |
|
|
|
23.2 |
|
Consent
of Morgan, Lewis & Bockius LLP (included in Exhibit 5.1). |
|
|
|
24.1 |
|
Power
of Attorney (included on signature page). |
|
|
|
99.1 |
|
Ocean
Bio-Chem, Inc. 2015 Equity Compensation Plan. |
10
Exhibit
5.1
[On
Morgan, Lewis & Bockius LLP letterhead]
May
28, 2015
Ocean
Bio-Chem, Inc.
4041
SW 47 Avenue
Ft.
Lauderdale, Florida 33314
Re: |
Ocean
Bio-Chem, Inc. |
|
Registration
Statement on Form S-8 Relating to the Ocean Bio-Chem, Inc. |
|
2015
Equity Compensation Plan |
Ladies and
Gentlemen:
We have
acted as counsel to Ocean Bio-Chem, Inc., a Florida corporation (the “Company”), in connection with the preparation
of a registration statement on Form S-8 (the “Registration Statement”) to be filed with the Securities and Exchange
Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Act”), relating to 630,000
shares of the Company’s common stock, $0.01 par value (the “Common Stock”), issuable under the Ocean Bio-Chem,
Inc. 2015 Equity Compensation Plan (the “Plan”). We have examined such certificates, records, statutes and other documents
as we have deemed relevant in rendering this opinion.
As to matters
of fact, we have relied on representations of officers of the Company. In our examination, we have assumed the genuineness of
all signatures, the legal capacity of all natural persons, the authenticity of the documents submitted to us as originals, the
conformity with the originals of all documents submitted to us as certified, facsimile or photostatic copies and the authenticity
of the originals of all documents submitted to us as copies.
Based
upon the foregoing, it is our opinion that, assuming the Company's shareholders approve the Plan at the Company's 2015
Annual Meeting of Shareholders, the shares of Common Stock originally issued by the Company to participants under the Plan,
when issued and delivered by the Company in accordance with the terms of the Plan and for such consideration as is permitted under the Florida Business Corporation Act, will be duly authorized, validly issued,
fully paid and non-assessable.
The opinion
set forth above is limited to the laws of the State of Florida.
We hereby
consent to the use of this opinion as Exhibit 5.1 to the Registration Statement. In giving such opinion, we do not thereby admit
that we are acting within the category of persons whose consent is required under Section 7 of the Act or the rules or regulations
of the Commission thereunder.
Very
truly yours,
/s/
Morgan, Lewis & Bockius, LLP
Exhibit
23.1
INDEPENDENT
AUDITORS’ CONSENT
We
consent to the incorporation by reference in this Registration Statement on Form S-8 of Ocean Bio-Chem, Inc. of our report
dated March 31, 2015, relating to the consolidated financial statements of Ocean Bio-Chem, Inc., appearing in the Annual Report
on Form 10-K of Ocean Bio-Chem, Inc. for the year ended December 31, 2014, and the reference to us under the heading
"Experts" in the Registration Statement.
/s/
Goldstein Schechter Koch P.A.
Certified
Public Accountants
Hollywood,
FL
May
28, 2015
Exhibit
99.1
OCEAN
BIO-CHEM, INC.
2015
EQUITY COMPENSATION PLAN
The
purpose of the Ocean Bio-Chem, Inc. 2015 Equity Compensation Plan (the “Plan”) is to provide (i) employees
of Ocean Bio-Chem, Inc. (the “Company”) and its subsidiaries, (ii) certain consultants and advisors who perform
services for the Company or its subsidiaries and (iii) non-employee members of the Board of Directors of the Company with the
opportunity to receive grants of incentive stock options, nonqualified stock options, stock appreciation rights, stock awards,
stock units, and other stock-based awards.
The
Company believes that the Plan will encourage the participants to contribute materially to the growth of the Company, thereby
benefitting the Company’s shareholders, and will align the economic interests of the participants with those of the shareholders.
The Plan shall be effective as of the Effective Date.
Section
1. Definitions
The
following terms shall have the meanings set forth below for purposes of the Plan:
(a) “Board” shall mean the Board of Directors of the Company.
(b) “Cause” shall mean, except to the extent specified otherwise by the Committee, a finding by the Committee that
the Participant (i) has breached his or her employment or service contract with the Employer, (ii) has engaged in disloyalty to
the Employer, including, without limitation, fraud, embezzlement, theft, commission of a felony or proven dishonesty, (iii) has
disclosed trade secrets or confidential information of the Employer to persons not entitled to receive such information, (iv)
has breached any written non-competition, non-solicitation, invention assignment or confidentiality agreement between the Participant
and the Employer or (v) has engaged in such other behavior detrimental to the interests of the Employer as the Committee determines.
(c) Unless otherwise set forth in a Grant Instrument, a “Change of Control” shall be deemed to have occurred if:
(i) Any “person” (as such term is used in sections 13(d) and 14(d) of the Exchange Act) becomes a “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than
50% of the voting power of the then outstanding securities of the Company; provided that a Change of Control shall not be deemed
to occur as a result of (a) any transfer of shares by a person who, as of the Effective Date, owns more than 50% of the voting
power of the outstanding securities of the Company or (b) a transaction in which the Company becomes a subsidiary of another corporation
and in which the shareholders of the Company, immediately prior to the transaction will immediately after the transaction beneficially
own shares entitling such shareholders to more than 50% of all votes to which all shareholders of the parent corporation would
be entitled in the election of directors.
(ii) The consummation of (A) a merger or consolidation of the Company with another corporation where the shareholders of the Company
immediately prior to the merger or consolidation will not, immediately after the merger or consolidation, beneficially own, in
substantially the same proportion as ownership immediately prior to the merger or consolidation, shares entitling such shareholders
to more than 50% of all votes to which all shareholders of the surviving corporation would be entitled in the election of directors,
or where the members of the Board, immediately prior to the merger or consolidation, would not, immediately after the merger or
consolidation, constitute a majority of the board of directors of the surviving corporation, (B) a sale or other disposition of
all or substantially all of the assets of the Company, or (C) a liquidation or dissolution of the Company.
(iii) Within any 24-month period beginning on or after the date hereof, the persons who were directors of the Company immediately before
the beginning of such period (the “Incumbent Directors”) shall cease (for any reason other than death) to constitute
at least a majority of the Board (or the board of directors of any successor to the Company); provided that any director who was
not a director as of the date hereof shall be deemed to be an Incumbent Director if such director was elected to the Board by,
or on the recommendation of or with the approval of, at least two-thirds of the directors who then qualified as Incumbent Directors
either actually or by prior operation of the foregoing unless such election, recommendation or approval was the result of an actual
or threatened election contest.
The
Committee may modify the definition of Change of Control for a particular Grant as the Committee deems appropriate to comply with
section 409A of the Code or otherwise.
(d) “Code” shall mean the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.
(e) “Committee” shall mean the Equity Grant Committee of the Board or another committee appointed by the Board
to administer the Plan. The Committee shall consist of two or more persons appointed by the Board, all of whom shall be “outside
directors” as defined under section 162(m) of the Code and “non-employee directors” as defined under Rule 16b-3
promulgated under the Exchange Act.
(f) “Company” shall mean Ocean Bio-Chem, Inc. and shall include its successors.
(g) “Company Stock” shall mean the common stock, $0.01 par value, of the Company.
(h) “Disability” or “Disabled” shall mean a Participant’s becoming disabled within the
meaning of section 22(e)(3) of the Code, within the meaning of the Employer’s long-term disability plan, if any, applicable
to the Participant or as otherwise determined by the Committee.
(i) “Dividend Equivalent” shall mean an amount determined by multiplying the number of shares of Company Stock
subject to a Grant by the per-share cash dividend paid by the Company on its outstanding Company Stock, or the per-share fair
market value (as determined by the Committee) of any dividend paid on its outstanding Company Stock in consideration other than
cash.
(j) “Effective Date” shall mean May 29, 2015; provided the shareholders approve the Plan on such date.
(k) “Employee” shall mean an employee of the Employer (including an officer or director who is also an employee),
but excluding any person who is classified by the Employer as a “contractor” or “consultant,” no matter
how characterized by the Internal Revenue Service, other governmental agency or a court. Any change of characterization of an
individual by the Internal Revenue Service or any court or government agency shall have no effect upon the classification of an
individual as an Employee for purposes of this Plan, unless the Committee determines otherwise.
(l) “Employed by, or providing service to, the Employer” shall mean employment or service as an Employee, Key Advisor
or member of the Board (so that, for purposes of exercising Options and SARs and satisfying conditions with respect to Stock Awards,
Stock Units, and Other Stock-Based Awards, a Participant shall not be considered to have terminated employment or service until
the Participant ceases to be an Employee, Key Advisor or member of the Board).
(m) “Employer” shall mean the Company and each of its subsidiaries.
(n) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(o) “Exercise Price” shall mean the per share price at which shares of Company Stock may be purchased under an
Option, as designated by the Committee.
(p) “Fair Market Value” shall mean:
(i) If the Company Stock is publicly traded, then the Fair Market Value per share shall be determined as follows: (A) if the principal
trading market for the Company Stock is a national securities exchange, the closing price during regular trading hours, as reported
by such exchange, on the relevant date or (if there were no trades on that date) the latest preceding date upon which a sale was
reported, or (B) if the Company Stock is not principally traded on any such exchange, the last reported sale price of a share
of Company Stock during regular trading hours on the relevant date, as reported by the OTC Bulletin Board.
(ii) If the Company Stock is not publicly traded or, if publicly traded, is not subject to reported transactions as set forth above,
the Fair Market Value per share shall be as determined by the Committee through any reasonable valuation method authorized under
the Code.
(q) “Grant” shall mean an Option, SAR, Stock Award, Stock Unit, or Other Stock-Based Award granted under the Plan.
(r) “Grant Instrument” shall mean the written agreement that sets forth the terms and conditions of a Grant, including
all amendments thereto.
(s) “Incentive Stock Option” shall mean an Option that is intended to meet the requirements of an incentive stock
option under section 422 of the Code.
(t) “Key Advisor” shall mean a consultant or advisor of the Employer.
(u) “Non-Employee Director” shall mean a member of the Board who is not an Employee.
(v) “Nonqualified Stock Option” shall mean an Option that is not intended to be taxed as an incentive stock option
under section 422 of the Code.
(w) “Option” shall mean an option to purchase shares of Company Stock, as described in Section 6.
(x) “Other Stock-Based Award” shall mean any Grant based on, measured by or payable in Company Stock, as described
in Section 10.
(y) “Plan” shall mean this Ocean Bio-Chem, Inc. 2015 Equity Compensation Plan, as in effect from time to time.
(z) “Participant” shall mean an Employee, Key Advisor or Non-Employee Director designated by the Committee to participate
in the Plan.
(aa) “SAR” shall mean a stock appreciation right, as described in Section 9.
(bb) “Stock Award” shall mean an award of Company Stock, as described in Section 7.
(cc) “Stock Unit” shall mean an award of a phantom unit representing a share of Company Stock, as described in Section
8.
Section
2. Administration
(a) Committee. The Plan shall be administered and interpreted by the Committee; provided, however, that any Grants to members
of the Equity Grant Committee must be authorized by the Board. The Committee may delegate authority to one or more subcommittees,
as it deems appropriate. To the extent that the Board or a subcommittee administers the Plan, references in the Plan to the “Committee”
shall be deemed to refer to the Board or such subcommittee. In the absence of a specific designation by the Board to the contrary,
the Plan shall be administered by the Committee or any successor Board committee performing substantially the same functions.
(b) Committee Authority. The Committee shall have the sole authority to (i) determine the individuals to whom Grants shall
be made under the Plan, (ii) determine the type, size and terms of the Grants to be made to each such individual, (iii) determine
the time when the Grants will be made, (iv) determine the duration of any applicable exercise or restriction period, including
the criteria for exercisability and the acceleration of exercisability, (v) amend the terms of any previously issued Grant, subject
to the provisions of Section 18 below, and (vi) deal with any other matters arising under the Plan.
(c) Committee Determinations. The Committee shall have full power and express discretionary authority to administer and interpret
the Plan, to make factual determinations and to adopt or amend such rules, regulations, agreements and instruments for implementing
the Plan and for the conduct of its business as it deems necessary or advisable, in its sole discretion. The Committee’s
interpretations of the Plan and all determinations made by the Committee pursuant to the powers vested in it hereunder shall be
conclusive and binding on all persons having any interest in the Plan or in any awards granted hereunder. All powers of the Committee
shall be executed in its sole discretion, in the best interest of the Company, not as a fiduciary, and in keeping with the objectives
of the Plan and need not be uniform as to similarly situated individuals.
Section
3. Grants
Grants
under the Plan may consist of Options as described in Section 6, Stock Awards as described in Section 7, Stock Units as described
in Section 8, SARs as described in Section 9, and Other Stock-Based Awards as described in Section 10. All Grants shall be subject
to the terms and conditions set forth herein and to such other terms and conditions consistent with this Plan as the Committee
deems appropriate and as are specified in writing by the Committee to the individual in the Grant Instrument. All Grants shall
be made conditional upon the Participant’s acknowledgement, in writing or by acceptance of the Grant, that all decisions
and determinations of the Committee shall be final and binding on the Participant, his or her beneficiaries and any other person
having or claiming an interest under such Grant. Grants under a particular Section of the Plan need not be uniform as among the
Participants.
Section
4. Shares Subject to the Plan
(a) Shares
Authorized. Subject to adjustment as described below, the aggregate number of shares of Company Stock that may be issued or
transferred under the Plan shall be 630,000 shares, all of which may be issued or transferred under the Plan pursuant to Incentive
Stock Options. Shares issued under the Plan may be authorized but unissued shares of Company Stock or reacquired shares of Company
Stock, including shares purchased by the Company on the open market for purposes of the Plan.
(b) Share
Counting. If and to the extent Options or SARs granted under the Plan terminate, expire, or are canceled, forfeited, exchanged
or surrendered without having been exercised, and if and to the extent that any Stock Awards, Stock Units, or Other Stock-Based
Awards are forfeited or terminated, or otherwise are not paid in full, the shares reserved for such Grants shall again be available
for purposes of the Plan. Shares of Company Stock surrendered in payment of the Exercise Price of an Option, and shares withheld
or surrendered for payment of taxes, shall not be available for re-issuance under the Plan. If SARs are exercised, the full number
of shares subject to the exercised SARs shall be considered issued under the Plan, without regard to the number of shares issued
upon settlement of the SARs and without regard to any cash settlement of the SARs. To the extent that a Grant of Stock Units is
designated in the Grant Instrument to be paid in cash and not in shares of Company Stock, such Grants shall not count against
the share limits in subsection (a).
(c) Individual Limits. The maximum aggregate number of shares of Company Stock that shall be subject to Grants made under the
Plan to any individual during any calendar year shall be 100,000 shares, subject to adjustment described below. The maximum aggregate
number of shares of Company Stock for which Options or SARs may be granted under the Plan to any individual during any calendar
year is 100,000 shares, subject to adjustment as described below. The maximum aggregate number of shares of Company Stock with
respect to which Stock Awards, Stock Units or Other Stock-Based Awards may be granted under the Plan to any individual during
any calendar year as “qualified performance-based compensation” under Section 12 shall be 100,000 shares, subject
to adjustment as described below. The foregoing individual share limits shall apply without regard to whether such Grants are
to be paid in Company Stock or in cash.
(d) Adjustments. If there is any change in the number or kind of shares of Company Stock outstanding by reason of (i) a stock
dividend, spinoff, recapitalization, stock split, or combination or exchange of shares, (ii) a merger, reorganization or consolidation,
(iii) a reclassification or change in par value, or (iv) any other extraordinary or unusual event affecting the outstanding Company
Stock as a class without the Company’s receipt of consideration, or if the value of outstanding shares of Company Stock
is substantially reduced as a result of a spinoff or the Company’s payment of an extraordinary dividend or distribution,
the maximum number of shares of Company Stock available for issuance under the Plan, the maximum number of shares of Company Stock
for which any individual may receive Grants in any year, the kind and number of shares covered by outstanding Grants, the kind
and number of shares issued and to be issued under the Plan, and the price per share or the applicable market value of such Grants
shall be equitably adjusted by the Committee to reflect any increase or decrease in the number of, or change in the kind or value
of, the issued shares of Company Stock to preclude, to the extent practicable, the enlargement or dilution of rights and benefits
under the Plan and such outstanding Grants; provided, however, that any fractional shares resulting from such adjustment shall
be eliminated. In addition, in the event of a Change of Control, the provisions of Section 13 of the Plan shall apply. Any adjustments
to outstanding Grants shall be consistent with section 409A or 424 of the Code, to the extent applicable. The Committee shall
have the sole discretion and authority to determine what appropriate adjustments shall be made and any adjustments determined
by the Committee shall be final, binding and conclusive.
Section
5. Eligibility for Participation
(a) Eligible Persons. All Employees (including, for all purposes of the Plan, an Employee who is a member of the Board) and
Non-Employee Directors shall be eligible to participate in the Plan. Key Advisors shall be eligible to participate in the Plan
if the Key Advisors render bona fide services to the Employer, the services are not in connection with the offer and sale of securities
in a capital-raising transaction and the Key Advisors do not directly or indirectly promote or maintain a market for the Company’s
securities.
(b) Selection of Participants. The Committee shall select the Employees, Non-Employee Directors and Key Advisors to receive
Grants and shall determine the number of shares of Company Stock subject to a particular Grant in such manner as the Committee
determines.
Section
6. Options
The
Committee may grant Options to an Employee, Non-Employee Director or Key Advisor upon such terms as the Committee deems appropriate.
The following provisions are applicable to Options:
(a) Number of Shares. The Committee shall determine the number of shares of Company Stock that will be subject to each Grant
of Options to Employees, Non-Employee Directors and Key Advisors.
(b) Type of Option and Exercise Price.
(i) The Committee may grant Incentive Stock Options or Nonqualified Stock Options or any combination of the two, all in accordance
with the terms and conditions set forth herein. Incentive Stock Options may be granted only to employees of the Company or its
parent or subsidiary corporations, as defined in section 424 of the Code. Nonqualified Stock Options may be granted to Employees,
Non-Employee Directors and Key Advisors.
(ii) The Exercise Price of Company Stock subject to an Option shall be determined by the Committee and shall be equal to or greater
than the Fair Market Value of a share of Company Stock on the date the Option is granted. However, an Incentive Stock Option may
not be granted to an Employee who, at the time of grant, owns stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company, or any parent or subsidiary corporation of the Company, as defined in section 424 of the
Code, unless the Exercise Price per share is not less than 110% of the Fair Market Value of a share of Company Stock on the date
of grant.
(c) Option Term. The Committee shall determine the term of each Option. The term of any Option shall not exceed ten years from
the date of grant. However, an Incentive Stock Option that is granted to an Employee who, at the time of grant, owns stock possessing
more than 10% of the total combined voting power of all classes of stock of the Company, or any parent or subsidiary corporation
of the Company, as defined in section 424 of the Code, may not have a term that exceeds five years from the date of grant.
(d) Exercisability of Options. Options shall become exercisable in accordance with such terms and conditions, consistent with
the Plan, as may be determined by the Committee and specified in the Grant Instrument. The Committee may accelerate the exercisability
of any or all outstanding Options at any time for any reason.
(e) Grants to Non-Exempt Employees. Notwithstanding the foregoing, Options granted to persons who are non-exempt employees
under the Fair Labor Standards Act of 1938, as amended, may not be exercisable for at least six months after the date of grant
(except that such Options may become exercisable, as determined by the Committee, upon the Participant’s death, Disability
or retirement, or upon a Change of Control or other circumstances permitted by applicable regulations).
(f) Termination of Employment, Disability or Death.
(i)
Except as provided below, an Option may only be exercised while the Participant is employed by, or providing service to, the Employer
as an Employee, member of the Board or Key Advisor.
(ii)
In the event that a Participant ceases to be employed by, or provide service to, the Employer for any reason other than Disability,
death or termination for Cause, any Option which is otherwise exercisable by the Participant shall terminate unless exercised
within 90 days after the date on which the Participant ceases to be employed by, or provide service to, the Employer (or within
such other period of time as may be specified by the Committee), but in any event no later than the date of expiration of the
Option term. Except as otherwise provided by the Committee, any of the Participant’s Options that are not otherwise exercisable
as of the date on which the Participant ceases to be employed by, or provide service to, the Employer shall terminate as of such
date.
(iii) In the event the Participant ceases to be employed by, or provide service to, the Company on account of a termination for Cause
by the Employer, any Option held by the Participant shall terminate as of the date the Participant ceases to be employed by, or
provide service to, the Employer. In addition, notwithstanding any other provisions of this Section 6, if the Committee determines
that the Participant has engaged in conduct that constitutes Cause at any time while the Participant is employed by, or providing
service to, the Employer or after the Participant’s termination of employment or service, any Option held by the Participant
shall immediately terminate and the Participant shall automatically forfeit all shares underlying any exercised portion of an
Option for which the Company has not yet delivered the share certificates, upon refund by the Company of the Exercise Price paid
by the Participant for such shares. Upon any exercise of an Option, the Company may withhold delivery of share certificates pending
resolution of an inquiry that could lead to a finding resulting in a forfeiture.
(iv) In the event the Participant ceases to be employed by, or provide service to, the Employer because the Participant is Disabled,
any Option which is otherwise exercisable by the Participant shall terminate unless exercised within one year after the date on
which the Participant ceases to be employed by, or provide service to, the Employer (or within such other period of time as may
be specified by the Committee), but in any event no later than the date of expiration of the Option term. Except as otherwise
provided by the Committee, any of the Participant’s Options which are not otherwise exercisable as of the date on which
the Participant ceases to be employed by, or provide service to, the Employer shall terminate as of such date.
(v) If the Participant dies while employed by, or providing service to, the Employer or within 90 days after the date on which the
Participant ceases to be employed or provide service on account of a termination specified in Section 6(f)(ii) above (or within
such other period of time as may be specified by the Committee), any Option that is otherwise exercisable by the Participant shall
terminate unless exercised within one year after the date on which the Participant ceases to be employed by, or provide service
to, the Employer (or within such other period of time as may be specified by the Committee), but in any event no later than the
date of expiration of the Option term. Except as otherwise provided by the Committee, any of the Participant’s Options that
are not otherwise exercisable as of the date on which the Participant ceases to be employed by, or provide service to, the Employer
shall terminate as of such date.
(g) Exercise of Options. A Participant may exercise an Option that has become exercisable, in whole or in part, by delivering
a notice of exercise to the Company. The Participant shall pay the Exercise Price for an Option as specified by the Committee
(i) in cash, (ii) unless the Committee determines otherwise, by delivering shares of Company Stock owned by the Participant and
having a Fair Market Value on the date of exercise at least equal to the Exercise Price, (iii) by payment through a broker in
accordance with procedures permitted by Regulation T of the Federal Reserve Board, or (iv) by such other method as the Committee
may approve. In addition, to the extent an Option is at the time vested with respect to all or a portion of the shares of Company
Stock underlying the Option, all or any part of that vested portion may be surrendered to the Company for an appreciation distribution
payable in shares of Company Stock with a Fair Market Value at the time of the Option surrender equal to the dollar amount by
which the then Fair Market Value of the shares of Company Stock subject to the surrendered portion exceeds the aggregate Exercise
Price payable for those shares. Shares of Company Stock used to exercise an Option shall have been held by the Participant for
the requisite period of time necessary to avoid adverse accounting consequences to the Company with respect to the Option. Payment
for the shares to be issued or transferred pursuant to the Option, and any required withholding taxes, must be received by the
Company by the time specified by the Committee depending on the type of payment being made, but in all cases prior to the issuance
or transfer of such shares.
(h) Limits on Incentive Stock Options. Each Incentive Stock Option shall provide that, if the aggregate Fair Market Value of
the Company Stock on the date of the grant with respect to which Incentive Stock Options are exercisable for the first time by
a Participant during any calendar year, under the Plan or any other stock option plan of the Company or a parent or subsidiary,
exceeds $100,000, then the Option, as to the excess, shall be treated as a Nonqualified Stock Option. The aggregate number of
shares of Company Stock that may be issued under the Plan as Incentive Stock Options is 630,000 shares, and all shares issued
under the Plan as Incentive Stock Options shall count against the aggregate number of shares of Company Stock set forth in Section
4(a) that may be issued or transferred under the Plan.
Section
7. Stock Awards
The
Committee may issue or transfer shares of Company Stock to an Employee, Non-Employee Director or Key Advisor under a Stock Award,
upon such terms as the Committee deems appropriate. The following provisions are applicable to Stock Awards:
(a) General Requirements. Shares of Company Stock issued or transferred pursuant to Stock Awards may be issued or transferred
for consideration or for no consideration, and subject to restrictions or no restrictions, as determined by the Committee. The
Committee may, but shall not be required to, establish conditions under which restrictions on Stock Awards shall lapse over a
period of time or according to such other criteria as the Committee deems appropriate, including, without limitation, restrictions
based upon the achievement of specific performance goals. The period of time during which the Stock Awards will remain subject
to restrictions will be designated in the Grant Instrument as the “Restriction Period.”
(b) Number of Shares. The Committee shall determine the number of shares of Company Stock to be issued or transferred pursuant
to a Stock Award and the restrictions applicable to such shares.
(c) Requirement of Employment or Service. If the Participant ceases to be employed by, or provide service to, the Employer
during a period designated in the Grant Instrument as the Restriction Period, or if other specified conditions are not met, the
Stock Award shall terminate as to all shares covered by the Grant as to which the restrictions have not lapsed, and those shares
of Company Stock must be immediately returned to the Company. The Committee may, however, provide for complete or partial exceptions
to this requirement as it deems appropriate.
(d) Restrictions on Transfer and Legend on Stock Certificate. During the Restriction Period, a Participant may not sell, assign,
transfer, pledge or otherwise dispose of the shares of a Stock Award except under Section 16(a) below. Unless otherwise determined
by the Committee, the Company will retain possession of certificates for shares of Stock Awards until all restrictions on such
shares have lapsed. Each certificate for a Stock Award, unless held by the Company, shall contain a legend giving appropriate
notice of the restrictions in the Grant. The Participant shall be entitled to have the legend removed from the stock certificate
covering the shares subject to restrictions when all restrictions on such shares have lapsed. The Committee may determine that
the Company will not issue certificates for Stock Awards until all restrictions on such shares have lapsed.
(e)
Right to Vote and to Receive Dividends. Unless the Committee determines otherwise, during the Restriction Period, the Participant
shall have the right to vote shares of Stock Awards and to receive any dividends or other distributions paid on such shares, subject
to any restrictions deemed appropriate by the Committee, including, without limitation, the achievement of specific performance
goals.
(f)
Lapse of Restrictions. All restrictions imposed on Stock Awards shall lapse upon the expiration of the applicable Restriction
Period and the satisfaction of all conditions, if any, imposed by the Committee. The Committee may determine, as to any or all
Stock Awards, that the restrictions shall lapse without regard to any Restriction Period.
Section
8. Stock Units
The
Committee may grant Stock Units, each of which shall represent one hypothetical share of Company Stock, to an Employee, Non-Employee
Director or Key Advisor upon such terms and conditions as the Committee deems appropriate. The following provisions are applicable
to Stock Units:
(a) Crediting of Units. Each Stock Unit shall represent the right of the Participant to receive a share of Company Stock or
an amount of cash based on the value of a share of Company Stock, if and when specified conditions are met. All Stock Units shall
be credited to bookkeeping accounts established on the Company’s records for purposes of the Plan.
(b) Terms of Stock Units. The Committee may grant Stock Units that are payable if specified performance goals or other conditions
are met, or under other circumstances. Stock Units may be paid at the end of a specified performance period or other period, or
payment may be deferred to a date authorized by the Committee. The Committee shall determine the number of Stock Units to be granted
and the requirements applicable to such Stock Units.
(c) Requirement of Employment or Service. If the Participant ceases to be employed by, or provide service to, the Employer
prior to the vesting of Stock Units, or if other conditions established by the Committee are not met, the Participant’s
Stock Units shall be forfeited. The Committee may, however, provide for complete or partial exceptions to this requirement as
it deems appropriate.
(d) Payment With Respect to Stock Units. Payments with respect to Stock Units shall be made in cash, Company Stock or any combination
of the foregoing, as the Committee shall determine.
Section
9. Stock Appreciation Rights
The
Committee may grant SARs to an Employee, Non-Employee Director or Key Advisor separately or in tandem with any Option. The following
provisions are applicable to SARs:
(a) General Requirements. The Committee may grant SARs to an Employee or Non-Employee Director separately or in tandem with
any Option (for all or a portion of the shares of Company Stock underlying the applicable Option). Tandem SARs may be granted
either at the time the Option is granted or at any time thereafter while the Option remains outstanding; provided, however, that,
in the case of an Incentive Stock Option, SARs may be granted only at the time of the Grant of the Incentive Stock Option. The
Committee shall establish the base amount of the SAR at the time the SAR is granted. The base amount of each SAR shall be equal
to the per share Exercise Price of the related Option or, if there is no related Option, an amount equal to or greater than the
Fair Market Value of a share of Company Stock as of the date of grant of the SAR.
(b) Tandem SARs. In the case of tandem SARs, the number of SARs granted to a Participant that shall be exercisable during a
specified period shall not exceed the number of shares of Company Stock that the Participant may purchase upon the exercise of
the related Option during such period. Upon the exercise of an Option, the SARs relating to the Company Stock covered by such
Option shall terminate. Upon the exercise of SARs, the related Option shall terminate to the extent of an equal number of shares
of Company Stock.
(c) Exercisability. An SAR shall be exercisable during the period specified by the Committee in the Grant Instrument and shall
be subject to such vesting and other restrictions as may be specified in the Grant Instrument. The Committee may accelerate the
exercisability of any or all outstanding SARs at any time for any reason. SARs may only be exercised while the Participant is
employed by, or providing service to, the Employer or during the applicable period after termination of employment or service
as described in Section 6(f) above. A tandem SAR shall be exercisable only during the period when the Option to which it is related
is also exercisable.
(d) Grants to Non-Exempt Employees. Notwithstanding the foregoing, SARs granted to persons who are non-exempt employees under
the Fair Labor Standards Act of 1938, as amended, may not be exercisable for at least six months after the date of grant (except
that such SARs may become exercisable, as determined by the Committee, upon the Participant’s death, Disability or retirement,
or upon a Change of Control or other circumstances permitted by applicable regulations).
(e) Value of SARs. When a Participant exercises SARs, the Participant shall receive in settlement of such SARs an amount equal
to the value of the stock appreciation for the number of SARs exercised. The stock appreciation for an SAR is the amount by which
the Fair Market Value of the underlying Company Stock on the date of exercise of the SAR exceeds the base amount of the SAR as
described in subsection (a).
(f) Form of Payment. The appreciation in an SAR shall be paid in shares of Company Stock, cash or any combination of the foregoing,
as the Committee shall determine. For purposes of calculating the number of shares of Company Stock to be received, shares of
Company Stock shall be valued at their Fair Market Value on the date of exercise of the SAR.
Section
10. Other Stock-Based Awards
The
Committee may grant Other Stock-Based Awards, which are awards (other than those described in Sections 6, 7, 8, and 9 of the Plan)
that are based on or measured by Company Stock, to any Employee, Non-Employee Director or Key Advisor, on such terms and conditions
as the Committee shall determine. Other Stock-Based Awards may be awarded subject to the achievement of performance goals or other
conditions and may be payable in cash, Company Stock or any combination of the foregoing, as the Committee shall determine.
Section
11. Dividend Equivalents
The
Committee may grant Dividend Equivalents in connection with Stock Units or Other Stock-Based Awards. Dividend Equivalents may
be paid currently or accrued as contingent cash obligations and may be payable in cash or shares of Company Stock, and upon such
terms as the Committee may establish, including, without limitation, the achievement of specific performance goals.
Section
12. Qualified Performance-Based Compensation
The
Committee may determine that Stock Awards, Stock Units, Other Stock-Based Awards and Dividend Equivalents granted to an Employee
shall be considered “qualified performance-based compensation” under section 162(m) of the Code. The following provisions
shall apply to Grants of Stock Awards, Stock Units, Other Stock-Based Awards and Dividend Equivalents that are to be considered
“qualified performance-based compensation” under section 162(m) of the Code:
(a) Performance Goals.
(i) When Stock Awards, Stock Units, Other Stock-Based Awards or Dividend Equivalents that are to be considered “qualified performance-based
compensation” are granted, the Committee shall establish in writing (A) the objective performance goals that must be met,
(B) the performance period during which the performance will be measured, (C) the threshold, target and maximum amounts that may
be paid if the performance goals are met, and (D) any other conditions that the Committee deems appropriate and consistent with
the Plan and section 162(m) of the Code.
(ii) The performance goal criteria may relate to the Participant’s business unit or the performance of the Company and its parents
and subsidiaries as a whole, or any combination of the foregoing. The Committee shall use objectively determinable performance
goals based on one or more of the following criteria: cash flow; earnings (including gross margin, earnings before interest and
taxes, earnings before taxes, earnings before interest, taxes, depreciation, amortization and charges for stock-based compensation,
earnings before interest, taxes, depreciation and amortization, and net earnings); earnings per share; growth in earnings or earnings
per share; stock price; return on equity or average shareholder equity; total shareholder return or growth in total shareholder
return either directly or in relation to a comparative group; return on capital; return on assets or net assets; invested capital,
required rate of return on capital or return on invested capital; revenue, growth in revenue or return on sales; income or net
income; operating income, net operating income or net operating income after tax; operating margin; return on operating revenue
or return on operating income; collections and recoveries, litigation and regulatory resolution goals, general and administrative
and other expense control goals, budget comparisons, growth in shareholder value relative to the growth of the companies and other
entities included in a specified index, the S&P Global Industry Classification Standards (“GICS”) or GICS Index,
or another peer group or peer group index; credit rating; development and implementation of strategic plans and/or organizational
restructuring goals; development and implementation of risk and crisis management programs; improvement in workforce diversity;
compliance requirements and compliance relief; safety goals; productivity goals; workforce management and succession planning
goals; measures of customer satisfaction, employee satisfaction or staff development; development or marketing collaborations,
formations of joint ventures or partnerships or the completion of other similar transactions intended to enhance the Company’s
revenue or profitability or enhance its customer base; merger and acquisitions; and other similar criteria consistent with the
foregoing.
(b) Establishment of Goals. The Committee shall establish the performance goals in writing either before the beginning of the
performance period or during a period ending no later than the earlier of (i) 90 days after the beginning of the performance period
or (ii) the date on which 25% of the performance period has been completed, or such other date as may be required or permitted
under applicable regulations under section 162(m) of the Code. The performance goals shall satisfy the requirements for “qualified
performance-based compensation,” including the requirement that the achievement of the goals be substantially uncertain
at the time they are established and that the goals be established in such a way that a third party with knowledge of the relevant
facts could determine whether and to what extent the performance goals have been met. The Committee shall not have discretion
to increase the amount of compensation that is payable upon achievement of the designated performance goals.
(c) Maximum Payment. The maximum number of shares of Company Stock that may be subject to Grants made to an individual during
a calendar year shall not exceed the individual limit set forth in Section 5(c). If Dividend Equivalents are granted as “qualified
performance based compensation,” the maximum amount of Dividend Equivalents that may be credited to the Employee’s
account in a calendar year is $100,000.
(d) Certification of Results. The Committee shall certify and announce the results for each performance period to all Participants
after the announcement of the Company’s financial results for the performance period. If and to the extent that the Committee
does not certify that the performance goals have been met, the grants of Stock Awards, Stock Units, Other Stock-Based Awards and
Dividend Equivalents for the performance period shall be forfeited or shall not be made, as applicable. If Dividend Equivalents
are granted as “qualified performance-based compensation” under section 162(m) of the Code, a Participant may not
accrue more than $100,000 of such Dividend Equivalents during any calendar year.
(e) Death, Disability or Other Circumstances. The Committee may provide that Stock Awards, Stock Units, Other Stock-Based Awards
and Dividend Equivalents shall be payable or restrictions on such Grants shall lapse, in whole or in part, in the event of the
Participant’s death or Disability during the performance period, or under other circumstances consistent with the Treasury
regulations and rulings under section 162(m) of the Code.
Section
13. Consequences of a Change of Control
(a) Notice and Acceleration. Unless the Committee determines otherwise, effective upon the date of the Change of Control, (i)
all outstanding Options and SARs shall automatically accelerate and become fully exercisable, (ii) the restrictions and conditions
on all outstanding Stock Awards shall immediately lapse, and (iii) all Stock Units, Other Stock-Based Awards and Dividend Equivalents
shall become fully vested and shall be paid at their target values, or in such greater amounts as the Committee may determine.
(b) Other Alternatives. Notwithstanding the foregoing, in the event of a Change of Control, the Committee may take one or more
of the following actions with respect to any or all outstanding Grants, without the consent of any Participant: the Committee
may (i) require that Participants surrender their outstanding Options and SARs in exchange for one or more payments by the Company,
in cash or Company Stock as determined by the Committee, in an amount equal to the amount by which the then Fair Market Value
of the shares of Company Stock subject to the Participant’s unexercised Options and SARs exceeds the Exercise Price of the
Options or the base amount of the SARs, as applicable, (ii) after giving Participants an opportunity to exercise their outstanding
Options and SARs, terminate any or all unexercised Options and SARs at such time as the Committee deems appropriate, or (iii)
determine that outstanding Options and SARs that are not exercised shall be assumed by, or replaced with comparable options or
rights by, the surviving corporation (or a parent or subsidiary of the surviving corporation), and other outstanding Grants that
remain in effect after the Change of Control shall be converted to similar grants of the surviving corporation (or a parent or
subsidiary of the surviving corporation). Such surrender or termination shall take place as of the date of the Change of Control
or such other date as the Committee may specify. Without limiting the foregoing, if the per share Fair Market Value of the shares
of Company Stock equals or is less than the per share Exercise Price or base amount, as applicable, the Company shall not be required
to make any payment to the Participant upon surrender of the Option or SAR. The Committee may provide in a Grant Instrument that
a sale or other transaction involving a subsidiary or other business unit of the Company shall be considered a Change of Control
for purposes of a Grant, or the Committee may establish other provisions that shall be applicable in the event of a specified
transaction.
Section
14. Deferrals
The
Committee may permit or require a Participant to defer receipt of the payment of cash or the delivery of shares that would otherwise
be due to such Participant in connection with any Grant. If any such deferral election is permitted or required, the Committee
shall establish rules and procedures for such deferrals and may provide for interest or other earnings to be paid on such deferrals.
The rules and procedures for any such deferrals shall be consistent with applicable requirements of section 409A of the Code.
Section
15. Withholding of Taxes
(a) Required Withholding. All Grants under the Plan shall be subject to applicable federal (including FICA), state and local
tax withholding requirements. The Employer may require that the Participant or other person receiving Grants or exercising Grants
pay to the Employer the amount of any federal, state or local taxes that the Employer is required to withhold with respect to
such Grants, or the Employer may deduct from other wages and compensation paid by the Employer the amount of any withholding taxes
due with respect to such Grants.
(b) Election to Withhold Shares. If the Committee so permits, a Participant may elect to satisfy the Employer’s tax withholding
obligation with respect to Grants paid in Company Stock by having shares withheld up to an amount that does not exceed the Participant’s
minimum applicable withholding tax rate for federal (including FICA), state and local tax liabilities. The election must be in
a form and manner prescribed by the Committee and may be subject to the prior approval of the Committee.
Section
16. Transferability of Grants
(a) Nontransferability of Grants. Except as described in subsection (b) below, only the Participant may exercise rights under
a Grant during the Participant’s lifetime. A Participant may not transfer those rights except (i) by will or by the laws
of descent and distribution or (ii) with respect to Grants other than Incentive Stock Options, pursuant to a domestic relations
order. When a Participant dies, the personal representative or other person entitled to succeed to the rights of the Participant
may exercise such rights. Any such successor must furnish proof satisfactory to the Company of his or her right to receive the
Grant under the Participant’s will or under the applicable laws of descent and distribution.
(b) Transfer of Nonqualified Stock Options. Notwithstanding the foregoing, the Committee may provide, in a Grant Instrument,
that a Participant may transfer Nonqualified Stock Options to family members, or one or more trusts or other entities for the
benefit of or owned by family members, consistent with the applicable securities laws, according to such terms as the Committee
may determine; provided that the Participant receives no consideration for the transfer of an Option and the transferred Option
shall continue to be subject to the same terms and conditions as were applicable to the Option immediately before the transfer.
Section
17. Requirements for Issuance or Transfer of Shares
No
Company Stock shall be issued or transferred in connection with any Grant hereunder unless and until all legal requirements applicable
to the issuance or transfer of such Company Stock have been complied with to the satisfaction of the Committee. The Committee
shall have the right to condition any Grant on the Participant’s undertaking in writing to comply with such restrictions
on his or her subsequent disposition of the shares of Company Stock as the Committee shall deem necessary or advisable, and certificates
representing such shares may be legended to reflect any such restrictions. Certificates representing shares of Company Stock issued
or transferred under the Plan may be subject to such stop-transfer orders and other restrictions as the Committee deems appropriate
to comply with applicable laws, regulations and interpretations, including any requirement that a legend be placed thereon.
Section
18. Amendment and Termination of the Plan
(a) Amendment. The Board may amend or terminate the Plan at any time; provided, however, that the Board shall not amend the
Plan without shareholder approval if such approval is required in order to comply with the Code or other applicable law, or to
comply with applicable stock exchange requirements.
(b) No Repricing Without Shareholder Approval. Notwithstanding anything in the Plan to the contrary, the Committee may not
reprice Options or SARs, nor may the Board amend the Plan to permit repricing of Options or SARs, unless the shareholders of the
Company provide prior approval for such repricing. The term “repricing” shall have the meaning given that term in
accordance with the applicable stock exchange in which such shares of Company Stock are registered, as in effect from time to
time, provided, that adjustments in accordance with Section 4(d) shall not constitute a repricing.
(c) Shareholder Approval for “Qualified Performance-Based Compensation.” If Grants are made as “qualified
performance-based compensation” under Section 12 above, the Plan must be reapproved by the shareholders no later than the
first shareholders meeting that occurs in the fifth year following the year in which the shareholders previously approved the
provisions of Section 12, if additional Grants are to be made under Section 12 and if required by section 162(m) of the Code or
the regulations thereunder.
(d) Termination of Plan. The Plan shall terminate on the day immediately preceding the tenth anniversary of its Effective Date,
unless the Plan is terminated earlier by the Board or is extended by the Board with the approval of the shareholders.
(e) Termination and Amendment of Outstanding Grants. A termination or amendment of the Plan that occurs after a Grant is made
shall not materially impair the rights of a Participant unless the Participant consents or unless the Committee acts under Section
20(f) below. The termination of the Plan shall not impair the power and authority of the Committee with respect to an outstanding
Grant. Whether or not the Plan has terminated, an outstanding Grant may be terminated or amended under Section 20(f) below or
may be amended by agreement of the Company and the Participant consistent with the Plan.
Section
19. Miscellaneous
(a) Grants in Connection with Corporate Transactions and Otherwise. Nothing contained in the Plan shall be construed to (i)
limit the right of the Committee to make Grants under the Plan in connection with the acquisition, by purchase, lease, merger,
consolidation or otherwise, of the business or assets of any corporation, firm or association, including Grants to employees thereof
who become Employees, or (ii) limit the right of the Company to grant stock options or make other awards outside of the Plan.
The Committee may make a Grant to an employee of another corporation who becomes an Employee by reason of a corporate merger,
consolidation, acquisition of stock or property, reorganization or liquidation involving the Company, in substitution for a stock
option or stock awards grant made by such corporation. Notwithstanding anything in the Plan to the contrary, the Committee may
establish such terms and conditions of the new Grants as it deems appropriate, including setting the Exercise Price of Options
or the base price of SARs at a price necessary to retain for the Participant the same economic value as the prior options or rights.
(b) Governing Document. The Plan shall be the controlling document. No other statements, representations, explanatory materials
or examples, oral or written, may amend the Plan in any manner. The Plan shall be binding upon and enforceable against the Company
and its successors and assigns.
(c) Funding of the Plan. The Plan shall be unfunded. The Company shall not be required to establish any special or separate
fund or to make any other segregation of assets to assure the payment of any Grants under the Plan.
(d) Rights of Participants. Nothing in the Plan shall entitle any Employee, Non-Employee Director, Key Advisor or other person
to any claim or right to receive a Grant under the Plan. Neither the Plan nor any action taken hereunder shall be construed as
giving any individual any rights to be retained by or in the employ of the Employer or any other employment rights.
(e) No Fractional Shares. No fractional shares of Company Stock shall be issued or delivered pursuant to the Plan or any Grant.
Except as otherwise provided under the Plan, the Committee shall determine whether cash, other awards or other property shall
be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited
or otherwise eliminated.
(f) Compliance with Law.
(i) The Plan, the exercise of Options and SARs and the obligations of the Company to issue or transfer shares of Company Stock under
Grants shall be subject to all applicable laws and regulations, and to approvals by any governmental or regulatory agency as may
be required. With respect to persons subject to section 16 of the Exchange Act, it is the intent of the Company that the Plan
and all transactions under the Plan comply with all applicable provisions of Rule 16b-3 or its successors under the Exchange Act.
In addition, it is the intent of the Company that Incentive Stock Options comply with the applicable provisions of section 422
of the Code, that Grants of “qualified performance-based compensation” comply with the applicable provisions of section
162(m) of the Code and that, to the extent applicable, Grants comply with the requirements of section 409A of the Code. To the
extent that any legal requirement or condition for satisfaction of a regulatory exception under section 16 of the Exchange Act
or sections 422, 162(m) or 409A of the Code as set forth in the Plan ceases to be required or otherwise imposed under section
16 of the Exchange Act or sections 422, 162(m) or 409A of the Code or the rules and regulations thereunder, that Plan provision
shall cease to apply. The Committee may revoke any Grant if it is contrary to law or modify a Grant to bring it into compliance
with any valid and mandatory government regulation. The Committee may also adopt rules regarding the withholding of taxes on payments
to Participants. The Committee may, in its sole discretion, agree to limit its authority under this Section.
(ii) The Plan is intended to comply with the requirements of section 409A of the Code, to the extent applicable. Each Grant shall be
construed and administered such that the Grant either (A) qualifies for an exemption from the requirements of section 409A of
the Code or (B) satisfies the requirements of section 409A of the Code. If a Grant is subject to section 409A of the Code, (I)
distributions shall only be made in a manner and upon an event permitted under section 409A of the Code, (II) payments to be made
upon a termination of employment shall only be made upon a “separation from service” under section 409A of the Code,
(III) unless the Grant specifies otherwise, each installment payment shall be treated as a separate payment for purposes of section
409A of the Code, and (IV) in no event shall a Grantee, directly or indirectly, designate the calendar year in which a distribution
is made except in accordance with section 409A of the Code.
(iii) Any Grant that is subject to section 409A of the Code and that is to be distributed to a Key Employee (determined as set forth
below) upon separation from service shall be administered so that any distribution with respect to such Award shall be postponed
for six months following the date of the Participant’s separation from service, if required by section 409A of the Code.
If a distribution is delayed pursuant to section 409A of the Code, the distribution shall be paid within 15 days after the end
of the six-month period. If the Grantee dies during such six-month period, any postponed amounts shall be paid within 90 days
of the Grantee’s death. The determination of Key Employees, including the number and identity of persons considered Key
Employees and the identification date, shall be made by the Committee or its delegate each year in accordance with section 416(i)
of the Code and the “specified employee” requirements of section 409A of the Code.
(iv) Notwithstanding anything in the Plan or any Grant Instrument to the contrary, each Grantee shall be solely responsible for the
tax consequences of Grants under the Plan, and in no event shall the Company have any responsibility or liability if a Grant does
not meet any applicable requirements of section 409A of the Code. Although the Company intends to administer the Plan to prevent
taxation under section 409A of the Code, the Company does not represent or warrant that the Plan or any Grant complies with any
provision of federal, state, local or other tax law.
(g) Employees Subject to Taxation Outside the United States. With respect to Participants who are believed by the Committee
to be subject to taxation in countries other than the United States, the Committee may make Grants on such terms and conditions,
consistent with the Plan, as the Committee deems appropriate to comply with the laws of the applicable countries, and the Committee
may create such procedures, addenda and subplans and make such modifications as may be necessary or advisable to comply with such
laws.
(h) Clawback Rights. Subject to the requirements of applicable law, the Committee may provide in any Grant Instrument that,
if a Participant breaches any restrictive covenant agreement between the Participant and the Employer or otherwise engages in
activities that constitute Cause either while employed by, or providing service to, the Employer or within a specified period
of time thereafter, all Grants held by the Participant shall terminate, and the Company may rescind any exercise of an Option
or SAR and the vesting of any other Grant and delivery of shares upon such exercise or vesting, as applicable on such terms as
the Committee shall determine, including the right to require that in the event of any such rescission, (i) the Participant shall
return to the Company the shares received upon the exercise of any Option or SAR and/or the vesting and payment of any other Grant
or, (ii) if the Participant no longer owns the shares, the Participant shall pay to the Company the amount of any gain realized
or payment received as a result of any sale or other disposition of the shares (or, in the event the Participant transfers the
shares by gift or otherwise without consideration, the Fair Market Value of the shares on the date of the breach), net of the
price originally paid by the Participant for the shares. Payment by the Participant shall be made in such manner and on such terms
and conditions as may be required by the Committee. The Employer shall be entitled to set off against the amount of any such payment
any amounts otherwise owed to the Participant by the Employer. In addition, all Grants under the Plan will be subject to such
other compensation, clawback and recoupment policies that may be applicable to employees of the Company, as in effect from time
to time and as approved by the Board or Committee, whether or not approved before the Effective Date.
(i)
Governing Law. The validity, construction, interpretation and effect of the Plan and Grant Instruments issued under the
Plan shall be governed and construed by and determined in accordance with the laws of the State of Florida, without giving effect
to the conflict of laws provisions thereof.
19
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