PROPOSAL NO. 3 – APPROVAL
OF THE LIBERATED SYNDICATION INC. 2018 OMNIBUS EQUITY INCENTIVE
PLAN.
The Board of Directors recommends
stockholder approval of the 2018 Omnibus Equity Incentive Plan (the
“2018 Plan”) for the issuance of up to 3,000,000
shares. The 2018 Plan shall be administered by the
Compensation Committee of the Company. A copy of the full text of
the 2018 Plan is included as Annex A to this Proxy
Statement.
The Compensation Committee shall
have the sole authority, in its discretion, to make all
determinations under the Plan, including but not limited to (i)
determining which Employees, Directors or Consultants shall receive
an Award, (ii) the time or times when an Award shall be made (the
date of grant of an Award shall be the date on which the Award is
awarded by the Compensation Committee), (iii) what type of Award
shall be granted, (iv) the term of an Award, (v) the date or dates
on which an Award vests, (vi) the form of any payment to be made
pursuant to an Award, (vii) the terms and conditions of an Award
(including the forfeiture of the Award, and/or any financial gain,
if the Holder of the Award violates any applicable restrictive
covenant thereof), (viii) the Restrictions under a Restricted Stock
Award, (ix) the number of Shares which may be issued under an
Award, (x) Performance Goals applicable to any Award and
certification of the achievement of such goals, and (xi) the waiver
of any Restrictions or Performance Goals, subject in all cases to
compliance with applicable laws.
The Company shall make awards
pursuant to the 2018 Plan upon determinations of the Compensation
Committee as to which of the eligible persons shall be awarded, the
type of award, the number of shares to be awarded and the term
during which any such awards may be exercised. At all times, a
majority of the members of the Compensation Committee making
determinations about the awards to employees must be disinterested
in the award being made.
Awards will expire no later than
ten years from the date of grant. Vested awards generally will
terminate upon the first to occur of: (1) expiration of the award;
or (2) ninety (90) days following the participant’s
termination of employment.
All employees, non-employee
directors and any other persons providing valuable services to the
Company are eligible to receive awards. Incentive Stock Options
under the 2018 Plan may only be granted to such employees of the
Company or any subsidiary thereof, as selected by the Compensation
Committee. Non-Qualified Stock Options and other stock awards may
be granted to employees, non-employee directors and any other
persons providing valuable services to the
Company.
In selecting the employees or
other persons to whom stock awards shall be granted, as well as
determining the number of shares subject to each award, the
Compensation Committee shall take into consideration such factors
as it deems relevant in connection with accomplishing the purpose
of the 2018 Plan. An awardee who has been granted an award may, if
he or she is otherwise eligible, be granted an additional award or
awards if the Compensation Committee shall so
determine.
No award may be granted under the
2018 Plan later than the expiration of 10 years from the effective
date of the 2018 Plan. No awards have been granted under the 2018
Plan and no determination has been made as to who will receive an
award if the 2018 Plan is approved by the
shareholders.
Because benefits under the 2018
Option Plan will depend on the Compensation Committee’s
actions and the fair market value of our common stock at various
future dates, it is not possible to determine the benefits that
will be received by executive officers and other employees if the
2018 Plan is approved by our shareholders.
We are seeking your approval for
the 2018 Plan. If stockholder approval is not obtained, no
Incentive Stock Options may be granted under the 2018
Plan.
The Board of Directors believes
that it is in our best interests to be able to continue to provide
a means by which our employees, including officers, may increase
their equity ownership in Libsyn and thereby to provide them with
an incentive to enhance stockholder returns. At this time, there
are no plans, proposals or arrangements, written or otherwise, to
grant any of the authorized awards under the 2018
Plan.
Stockholder
Approval
The affirmative vote of the
holders of a majority of the stockholders’ shares present in
person or represented by proxy at the annual meeting and entitled
to vote is required to approve the 2018 Omnibus Equity Incentive
Plan.
Your Board of
Directors unanimously recommends a vote FOR approval of the 2018
Omnibus Equity Incentive Plan.
PROPOSAL NO. 4 – TO AMEND
LIBERATED SYNDICATION’S ARTICLES OF INCORPORATION TO EFFECT A
REVERSE STOCK SPLIT OF LIBERATED SYNDICATION’S ISSUED AND
OUTSTANDING COMMON STOCK WITHIN THE RANGE OF ONE-FOR-TWO TO ONE-FOR
TEN (WITH THE EXACT AMOUNT TO BE DETERMINE BY LIBERATED
SYNDICATION’S BOARD OF DIRECTORS).
The Board of Directors has
unanimously adopted a resolution declaring advisable and
recommending to the stockholders for their approval a proposal to
amend the Company’s articles of incorporation, to effect a
reverse stock split of Liberated Syndication’s issued and
outstanding common stock at any whole number ratio between, and
inclusive of, one-for-two and one-for-ten (the “Reverse Stock
Split”). Approval of this Proposal Number 4 would grant
Liberated Syndication’s Board the authority, without further
action by the stockholders, to carry out the Reverse Stock Split,
at any time within eighteen months after the date stockholder
approval for the Reverse Stock Split is obtained from the
stockholders, with the exact exchange ratio and timing of the
Reverse Stock Split (if at all) to be determined at Liberated
Syndication’s Board’s discretion. The Board’s
decision whether or not (and when) to effect a Reverse Stock Split
(and at what whole number ratio to effect the Reverse Stock Split)
will be based on a number of factors, including market conditions,
existing and anticipated trading prices for our common stock and
the continued listing requirements of the NASDAQ Capital
Market.
As explained below, we are asking
our stockholders to approve this Proposal Number 4 because we
believe a Reverse Stock Split would result in a higher price per
share for Liberated Syndications outstanding shares of our common
stock, which should enable us to become listed on NASDAQ and allow
the Company to meet the initial listing standards of the NASDAQ
Capital Market.
What to Expect from a Reverse Stock Split
If approved by libsyn’s
stockholders, the Reverse Stock Split would be implemented
simultaneously for all of libsyn’s outstanding common stock
and would affect all libsyn’s stockholders uniformly and
would not affect any stockholder’s percentage ownership
interests in libsyn, except to the extent that the Reverse Stock
Split results in any of our stockholders owning a fractional share,
because fractional shares would be rounded down to the nearest
whole share.
Reasons for the Reverse Stock Split
The Board of Directors of
Liberated Syndication approved the proposal authorizing the reverse
stock split because it believes that a reverse stock split will
allow the company to satisfy the initial listing requirements of
the NASDAQ Capital Market, and the Board of Directors of Liberated
Syndication also believes that the increased market price of
Liberated Syndication common stock expected to result from the
implementation of a reverse stock split may improve the
marketability and liquidity of Liberated Syndication’s common
stock.
NASDAQ
Requirements for Listing on the NASDAQ Capital
Market
Liberated Syndication common
stock is currently quoted on the OTCQB Markets. The initial listing
standards of the NASDAQ Capital Market require, among other things,
a $4.00 per share minimum bid price. As of the date of the mailing
of this proxy statement, Liberated Syndication does not meet the
initial listing application requirements for the NASDAQ Capital
Market.
The Board of Directors of
Liberated Syndication expects that a reverse stock split of
Liberated Syndication’s common stock will increase the market
price of Liberated Syndication’s common stock so that the
company is able to achieve the initial listing requirements for the
NASDAQ Capital Market and thereafter maintain compliance with the
NASDAQ minimum bid price listing standard of $1.00 per share. In
determining the exact ratio for the reverse stock split, Liberated
Syndication intends to use a ratio from within the range of
one-for-two to one-for-ten that would result in a per share price
of greater than $4.00 per share following the reverse stock split.
Notwithstanding the foregoing, there can be no assurance that the
market price per share following the reverse stock split will
remain in excess of the minimum bid price for a sustained period of
time. In addition, there can be no assurance that the Liberated
Syndication’s common stock will not be delisted due to a
failure to meet other continued listing requirements even if the
market price per share of Liberated Syndication’s common
stock on a post-reverse-stock-split basis remains in excess of the
minimum bid requirement.
Additionally, the Board of
Directors of Liberated Syndication believes that a listing on the
NASDAQ Capital Market for the shares of common stock of the Company
may provide a broader market for the common stock of the Company
and facilitate the use of the common stock of the Company in
financing and other transactions.
Effects of the Reverse Stock Split
Following the effective date of
the reverse stock split, each Liberated Syndication stockholder
will own a reduced number of shares of Liberated Syndication common
stock. The reverse stock split will affect all of the Liberated
Syndication stockholders uniformly and will not, in and of itself,
affect any Liberated Syndication stockholder’s percentage
ownership interests in Liberated Syndication, except to the extent
that the reverse stock split results in any of the Liberated
Syndication stockholders owning a fractional share. Voting rights
and other rights and preferences of the Liberated Syndication
stockholders will not be affected by the reverse stock split, in
and of itself, except to the extent that the reverse stock split
results in any of the Liberated Syndication stockholders owning a
fractional share. For example, a holder of 2% of the voting power
of the outstanding shares of Liberated Syndication common stock
immediately prior to the reverse stock split will continue to hold
2% of the voting power of the outstanding shares of Liberated
Syndication common stock immediately following the reverse stock
split. The number of Liberated Syndication stockholders of record
will not be affected by the reverse stock
split.
The amendment to the Liberated
Syndication articles of incorporation to effect the reverse stock
split, in and of itself, will not change the number of authorized
shares of Liberated Syndication common stock. As a result, one of
the effects of the reverse stock split will be to effectively
increase the proportion of authorized shares of Liberated
Syndication common stock which are unissued relative to those which
are issued. This could result in Liberated Syndication having the
ability to issue more shares without further stockholder approval.
Liberated Syndication does not have any current plan, commitment,
arrangement, understanding, or agreement, written or oral, to issue
shares of Liberated Syndication common stock, other than in
connection with any grants under the 2018 Omnibus Equity Incentive
Plan.
The reverse stock split will
reduce the number of shares of Liberated Syndication common stock
available for issuance under Liberated Syndication’s equity
incentive plan in proportion to the reverse stock split ratio
selected within the range set forth in this proposal. Under the
terms of the Liberated Syndication 2018 Omnibus Equity Incentive
Plan, the reverse stock split will effect a reduction in the number
of shares of Liberated Syndication common stock issuable upon
exercise of such outstanding awards in proportion to the reverse
stock split ratio and will effect a proportionate increase in the
exercise price of such outstanding awards. In connection with the
reverse stock split, the number of shares of Liberated Syndication
common stock issuable upon exercise of outstanding Liberated
Syndication stock grants will be rounded down to the nearest whole
share and no cash payment will be made in lieu of any fractional
shares of Liberated Syndication common stock that would otherwise
be issuable pursuant to such awards. The reverse stock split will
not in and of itself change the value of a Liberated Syndication
awards.
Liberated Syndication common
stock is currently registered under Section 12(b) of the
Exchange Act, and Liberated Syndication is subject to the periodic
reporting and other requirements of the Exchange Act. The reverse
stock split will not affect the registration of Liberated
Syndication common stock under the Exchange Act. If the reverse
stock split is implemented, and the company’s initial listing
application with the NASDAQ Capital Market is approved, Liberated
Syndication common stock will be reported on the NASDAQ Capital
Market under the symbol “LSYN”.
The following table provides
estimates of the number of shares of Liberated Syndication common
stock authorized, issued and outstanding, reserved for issuance,
and authorized but neither issued nor reserved for issuance at the
following times:
●
prior to the reverse stock
split;
●
giving effect to a one-for-two
reverse stock split; and
●
giving effect to a one-for-ten
reverse stock split.
|
|
Shares Issued
and Outstanding (1)
|
Shares
Reserved
for Issuance
(1)
|
Number of
Shares Authorized but Neither Issued nor Reserved for Issuance
(1)
|
Prior to the
reverse stock split
|
200,000,000
|
29,776,974
|
3,000,000
|
167,223,026
|
Giving effect
to a one-for-two reverse stock split
|
200,000,000
|
14,888,487
|
1,500,000
|
183,611,487
|
Giving effect
to a one-for-ten] reverse stock split
|
200,000,000
|
2,977,697
|
300,000
|
196,722,303
|
(1)
|
These estimates are based upon
the number of shares of Liberated Syndication common stock issued
and outstanding as of June 30, 2018.
|
As of July 15, 2018, the last
practicable date before the printing of this proxy statement,
29,776,974 shares of Liberated Syndication common stock were
outstanding calculated on a fully diluted basis. After the effect
of the reverse stock split, assuming it had been completed as of
July 15, 2018, assuming a reverse stock split ratio of
one-for-four, each share of Liberated common stock would have been
exchanged for 7,444,243 shares of Liberated Syndication common
stock.
Effective Date
The reverse stock split will
become effective on the date of filing of the articles of amendment
to the Liberated Syndication articles of incorporation with the
office of the Secretary of the State of Nevada. Except as explained
below with respect to fractional shares, on the effective date of
the reverse stock split, shares of Liberated Syndication common
stock issued and outstanding immediately prior to such effective
date will be converted, automatically and without any action on the
part of the Liberated Syndication stockholders.
No Payment for Fractional Shares
No fractional shares will be
issued in connection with the reverse stock split. Liberated
Syndication stockholders of record who otherwise would be entitled
to receive fractional shares, will experience a rounding down of
their fractional share to the nearest whole
share.
Exchange of Stock Certificates
As soon as practicable following
the effective date of the reverse stock split, Liberated
Syndication stockholders will be notified that the reverse stock
split has been effected. Liberated Syndication’s transfer
agent will act as exchange agent for purposes of implementing the
exchange of stock certificates. Holders of pre-reverse stock split
shares will be
asked
to surrender to the exchange
agent certificates representing pre-reverse stock split shares in
exchange for certificates representing post-reverse stock split
shares in accordance with the procedures to be set forth in a
letter of transmittal to be sent by the exchange agent. No new
certificates will be issued to a Liberated Syndication stockholder
until such stockholder has surrendered such stockholder’s
outstanding certificate(s), together with the properly completed
and executed letter of transmittal to the exchange agent.
Liberated Syndication stockholders
should not destroy any Liberated Syndication stock certificates and
should not submit any such certificates until requested to do
so.
Accounting Consequences
The par value per share of
Liberated Syndication common stock will remain unchanged at $0.001
per share following the reverse stock split. As a result, on the
effective date of the reverse stock split, the stated capital on
Liberated Syndication’s balance sheet attributable to
Liberated Syndication common stock will be reduced proportionally,
based on the reverse stock split ratio, from its present amount,
and the additional paid-in capital account shall be credited with
the amount by which the stated capital is reduced. The per share
common stock net income or loss and net book value will be
increased because there will be fewer shares of Liberated
Syndication common stock outstanding. Liberated Syndication does
not anticipate that any other accounting consequences will arise as
a result of the reverse stock split.
Material U.S. Federal Income Tax Consequences of the Reverse Stock
Split
The following discussion
summarizes the anticipated material U.S. federal income tax
consequences of the reverse stock split. This summary is based upon
current provisions of the Internal Revenue Code of 1986, as amended
(the “Code”), existing Treasury Regulations, and
current administrative rulings and court decisions, all of which
are subject to change and to differing interpretations, possibly
with retroactive effect. Any such change could alter the tax
consequences to Liberated Syndication or the Liberated Syndication
stockholders, as described in this summary. This summary is not
binding on the IRS, and there can be no assurance that the IRS (or
a court, in the event of an IRS challenge) will agree with the
conclusions stated herein. No ruling has been or will be requested
from the IRS in connection with the reverse stock
split.
This discussion is not intended
to be a complete analysis or description of all potential U.S.
federal income tax consequences of the reverse stock split. In
addition, the discussion set forth below does not address any U.S.
federal non-income tax or any state, local or foreign tax
consequences of the reverse stock split and does not address the
tax consequences of any fractional shares or any transaction other
than the reverse stock split. Moreover, this discussion does not
address U.S. federal income tax consequences of the reverse stock
split that may vary with individual circumstances or that are
relevant to Liberated Syndication stockholders that are subject to
particular rules, including, without limitation, persons whose
functional currency is not the U.S. dollar; persons holding
Liberated Syndication common stock as part of a hedge, straddle, or
other risk reduction strategy or as part of a conversion
transaction or other integrated investment; persons who are
not U.S. Holders (as defined below); persons holding Liberated
Syndication common stock through non-U.S. brokers or other non-U.S.
intermediaries; banks, insurance companies, and other
financial institutions; real estate investment trusts or
regulated investment companies; brokers, dealers, or traders
in securities; partnerships or other entities or arrangements
treated as partnerships or pass-through entities for U.S. federal
income tax purposes (and investors therein); tax-exempt or
governmental entities or organizations; persons deemed to sell
Liberated Syndication common stock under the constructive sale
provisions of the Code; persons who hold or receive Liberated
Syndication common stock pursuant to the exercise of any employee
stock options or otherwise as compensation; persons who hold their
Liberated Syndication common stock other than as a “capital
asset” within the meaning of Section 1221 of the Code
(generally, property held for investment); and individual
retirement accounts or other tax-deferred accounts or tax-qualified
retirement plans.
This discussion is limited to
holders of Liberated Syndication common stock that are U.S.
Holders. For the purposes of this discussion, a “U.S.
Holder” is a beneficial owner of Liberated Syndication common
stock that, for U.S. federal income tax purposes, is or is treated
as:
●
an
individual who is a citizen or resident of the United States,
including without limitation an alien individual who is a lawful
permanent resident of the United States or who meets the
“substantial presence” test under Section 7701(b)
of the Code;
●
a
corporation (or other entity taxable as a corporation for U.S.
federal income tax purposes) created or organized (or treated as
created or organized) under the laws of the United States, any
state thereof, or the District of Columbia;
●
an
estate, the income of which is subject to U.S. federal income tax
regardless of its source; or
●
a
trust if either a court within the United States is able to
exercise primary supervision over the administration of such trust
and one or more United States persons (within the meaning of
Section 7701(a)(30) of the Code) have the authority to control
all substantial decisions of such trust, or the trust has a valid
election in effect under applicable Treasury Regulations to be
treated as a United States person for U.S. federal income tax
purposes.
If an entity treated as a
partnership for U.S. federal income tax purposes holds Liberated
Syndication common stock, the tax treatment of a partner in the
partnership will depend on the status of the partner, the
activities of the partnership and certain determinations made at
the partner level.
The Reverse Stock Split is
expected to qualify as a “recapitalization” within the
meaning of Section 368(a) of the Code. Assuming the reverse
stock split so qualifies, the following consequences will
result:
●
no
gain or loss will be recognized by Liberated Syndication as a
result of the reverse stock split;
●
a
Liberated Syndication stockholder generally will recognize no gain
or loss upon the receipt (or exchange) of Liberated Syndication
common stock in the reverse stock split;
●
a
Liberated Syndication stockholder’s aggregate tax basis in
the post-reverse stock split shares of Liberated Syndication common
stock received (or deemed received) in the reverse stock split will
be equal to the aggregate tax basis of the pre-reverse stock split
shares of Liberated Syndication common stock exchanged (or deemed
exchanged) therefor; and
●
a
Liberated Syndication stockholder’s holding period of the
post-reverse stock split shares of Liberated Syndication common
stock received (or deemed received) in the reverse stock split will
include such stockholder’s holding period of the pre-reverse
stock split shares exchanged (or deemed exchanged)
therefor.
U.S. Holders of Liberated
Syndication common stock that acquired their shares on different
dates and/or at different prices should consult their tax advisors
regarding the proper allocation of the tax basis and holding
periods of such shares.
Liberated
Syndication stockholders are advised and expected to consult their
own tax advisors regarding the U.S. federal income tax consequences
of the reverse stock split in light of their personal circumstances
and the consequences of the reverse stock split under U.S. federal
non-income tax laws and state, local, and foreign tax
laws.
No Appraisal Rights
Liberated Syndication
stockholders are not entitled to appraisal rights with respect to
the proposed amendment to the Liberated Syndication articles of
incorporation to effect the reverse stock split and Liberated
Syndication will not independently provide the Liberated
Syndication stockholders with any such rights.
Your Board of
Directors unanimously recommends a vote FOR ratification of the
approval of the reverse stock split.
YOUR VOTE IS
IMPORTANT. WE URGE YOU TO SIGN, DATE AND PROMPTLY RETURN YOUR PROXY
CARD SO THAT YOUR SHARES MAY BE VOTED IN ACCORDANCE WITH YOUR
WISHES AND THAT THE PRESENCE OF A QUORUM MAY BE ASSURED. THE PROMPT
RETURN OF YOUR SIGNED PROXY CARD, REGARDLESS OF THE NUMBER OF
SHARES YOU HOLD, WILL AID US IN AVOIDING THE EXPENSE OF ADDITIONAL
PROXY SOLICITATIONS. GIVING YOUR PROXY DOES NOT AFFECT YOUR RIGHT
TO VOTE IN PERSON AT THE MEETING OR YOUR RIGHT TO RESUBMIT LATER
DATED PROXY CARDS.
Liberated Syndication
Inc.
By Order of the Board of
Directors,
/s/
Christopher J.
Spencer
Christopher J.
Spencer
Chief
Executive Officer
LIBERATED
SYNDICATION INC.
2018 OMNIBUS
EQUITY INCENTIVE PLAN
LIBERATED
SYNDICATION INC.
2018 OMNIBUS EQUITY INCENTIVE
PLAN
ARTICLE
I
PURPOSE
The purpose of this Liberated
Syndication Inc. 2018 Omnibus Equity Incentive Plan (the
“
Plan
”) is to benefit
Liberated Syndication Inc., a Nevada corporation (the
“
Company
”) and its
stockholders, by assisting the Company and its subsidiaries to
attract, retain and provide incentives to employees, directors, and
consultants of the Company and its Affiliates, and to align the
interests of such service providers with those of the
Company’s stockholders. Accordingly, the Plan provides for
the granting of Non-qualified Stock Options, Incentive Stock
Options, Restricted Stock Awards, Restricted Stock Unit Awards,
Performance Stock Awards, Performance Unit Awards, Unrestricted
Stock Awards, or any combination of the
foregoing.
ARTICLE
II
DEFINITIONS
The following definitions shall
be applicable throughout the Plan unless the context otherwise
requires:
2.1
“
Affiliate
” shall mean
any corporation which, with respect to the Company, is a
“subsidiary corporation” within the meaning of Section
424(f) of the Code or other entity in which the Company has a
controlling interest in such entity or another entity which is part
of a chain of entities in which the Company or each entity has a
controlling interest in another entity in the unbroken chain of
entities ending with the applicable entity.
2.2
“
Award
” shall mean,
individually or collectively, any Option, Restricted Stock Award,
Restricted Stock Unit Award, Performance Stock Award, Performance
Unit Award, or Unrestricted Stock Award.
2.3
“
Award Agreement
” shall
mean a written agreement between the Company and the Holder with
respect to an Award, setting forth the terms and conditions of the
Award, as amended.
2.4
“
Board
” shall mean the
Board of Directors of the Company.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
2.5
“
Cause
” shall mean
(i) if the Holder is a party to an employment or service
agreement with the Company or an Affiliate which agreement defines
“Cause” (or a similar term), “
Cause
” shall have the
same meaning as provided for in such agreement, or (ii) for a
Holder who is not a party to such an agreement, “
Cause
” shall mean
termination by the Company or an Affiliate of the employment (or
other service relationship) of the Holder by reason of the
Holder’s (A) intentional failure to perform reasonably
assigned duties, (B) dishonesty or willful misconduct in the
performance of the Holder’s duties, (C) involvement in a
transaction which is materially adverse to the Company or an
Affiliate, (D) breach of fiduciary duty involving personal profit,
(E) willful violation of any law, rule, regulation or court order
(other than misdemeanor traffic violations and misdemeanors not
involving misuse or misappropriation of money or property), (F)
commission of an act of fraud or intentional misappropriation or
conversion of any asset or opportunity of the Company or an
Affiliate, or (G) material breach of any provision of the Plan or
the Holder’s Award Agreement or any other written agreement
between the Holder and the Company or an Affiliate, in each case as
determined in good faith by the Board, the determination of which
shall be final, conclusive and binding on all
parties.
2.6
“
Change of Control
” shall
mean: (i) for a Holder who is a party to an employment or
consulting agreement with the Company or an Affiliate which
agreement defines “Change of Control” (or a similar
term), “
Change of
Control
” shall have the same meaning as provided for
in such agreement, or (ii) for a Holder who is not a party to such
an agreement, “
Change of Control
” shall
mean the satisfaction of any one or more of the following
conditions (and the “Change of Control” shall be deemed
to have occurred as of the first day that any one or more of the
following conditions shall have been
satisfied):
(a)
Any person (as such term is used
in paragraphs 13(d) and 14(d)(2) of the Exchange Act, hereinafter
in this definition, “
Person
”), other than the
Company or an Affiliate or an employee benefit plan of the Company
or an Affiliate, becomes the beneficial owner (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing more than fifty percent
(50%) of the combined voting power of the Company’s then
outstanding securities;
(b)
The closing of a merger,
consolidation or other business combination (a “
Business Combination
”)
other than a Business Combination in which holders of the Shares
immediately prior to the Business Combination have substantially
the same proportionate ownership of the common stock or ordinary
shares, as applicable, of the surviving corporation immediately
after the Business Combination as immediately
before;
Liberated
Syndication Inc. 2018 Omnibus Equity Incentive
Plan
(c)
The closing of an agreement for
the sale or disposition of all or substantially all of the
Company’s assets to any entity that is not an
Affiliate;
(d)
The approval by the holders of
shares of a plan of complete liquidation of the Company, other than
a merger of the Company into any subsidiary or a liquidation as a
result of which persons who were stockholders of the Company
immediately prior to such liquidation have substantially the same
proportionate ownership of shares of common stock or ordinary
shares, as applicable, of the surviving corporation immediately
after such liquidation as immediately before;
or
(e)
Within any
twenty-four (24) month period, the Incumbent Directors shall cease
to constitute at least a majority of the Board or the board of
directors of any successor to the Company;
provided
,
however
, that any director
elected to the Board, or nominated for election, by a majority of
the Incumbent Directors then still in office, shall be deemed to be
an Incumbent Director for purposes of this paragraph (e), but
excluding, for this purpose, any such individual whose initial
assumption of office occurs as a result of either an actual or
threatened election contest with respect to the election or removal
of directors or other actual or threatened solicitation of proxies
or consents by or on behalf of an individual, entity or
“group” other than the Board (including, but not
limited to, any such assumption that results from paragraphs (a),
(b), (c), or (d) of this definition).
2.7
“
Code
” shall mean the
United States of America Internal Revenue Code of 1986, as amended.
Reference in the Plan to any section of the Code shall be deemed to
include any amendments or successor provisions to any section and
any regulation under such section.
2.8
“
Committee
” shall mean a
committee comprised of two (2) or more members of the Board who are
selected by the Board as provided in Section
4.1.
2.9
“
Company
” shall have the
meaning given to such term in the introductory paragraph, including
any successor thereto.
2.10
“
Consultant
” shall mean
any non-Employee (individual or entity) advisor to the Company or
an Affiliate who or which has contracted directly with the Company
or an Affiliate to render bona fide consulting or advisory services
thereto.
2.11
“
Director
” shall mean a
member of the Board or a member of the board of directors of an
Affiliate, in either case, who is not an
Employee.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
2.12
“
Effective Date
” shall
mean May 1, 2018.
2.13
“
Employee
” shall mean any
employee, including any officer, of the Company or an
Affiliate.
2.14
“
Exchange Act
” shall mean
the United States of America Securities Exchange Act of 1934, as
amended.
2.15
“
Fair Market Value
” shall
mean, as of any specified date, the closing sales price of the
Shares for such date (or, in the event that the Shares are not
traded on such date, on the immediately preceding trading date) on
the NASDAQ Stock Market (“NASDAQ”), as reported by
NASDAQ, or such other domestic or foreign national securities
exchange, including OTC Markets (OTCQB, OTCQX), on which the Shares
may be listed. If the Shares are not listed on NASDAQ or on a
national securities exchange, but are quoted on the OTC Bulletin
Board or by the National Quotation Bureau, the Fair Market Value of
the Shares shall be the mean of the highest bid and lowest asked
prices per Share for such date. If the Shares are not quoted or
listed as set forth above, Fair Market Value shall be determined by
the Board in good faith by any fair and reasonable means (which
means may be set forth with greater specificity in the applicable
Award Agreement). The Fair Market Value of property other than
Shares shall be determined by the Board in good faith by any fair
and reasonable means consistent with the requirements of applicable
law.
2.16
“
Family Member
” of an
individual shall mean any child, stepchild, grandchild, parent,
stepparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law or sister-in-law, including adoptive relationships,
any person sharing the Holder’s household (other than a
tenant or employee of the Holder), a trust in which such persons
have more than fifty percent (50%) of the beneficial interest, a
foundation in which such persons (or the Holder) control the
management of assets, and any other entity in which such persons
(or the Holder) own more than fifty percent (50%) of the voting
interests.
2.17
“
Holder
” shall mean an
Employee, Director or Consultant who has been granted an Award or
any such individual’s beneficiary, estate or representative,
who has acquired such Award in accordance with the terms of the
Plan, as applicable.
2.18
“
Incentive Stock Option
”
shall mean an Option which is intended by the Committee to
constitute an “incentive stock option” and conforms to
the applicable provisions of Section 422 of the
Code.
2.19
“
Incumbent Director
”
shall mean, with respect to any period of time specified under the
Plan for purposes of determining whether or not a Change of Control
has occurred, the individuals who were members of the Board at the
beginning of such period.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
2.20
“
Non-qualified Stock
Option
” shall mean an Option which is not an Incentive
Stock Option or which is designated as an Incentive Stock Option
but does not meet the applicable requirements of Section 422 of the
Code.
2.21
“
Option
”
shall mean an Award granted under Article VII of the Plan of an
option to purchase Shares and shall include both Incentive Stock
Options and Non-qualified Stock Options.
2.22
“
Option Agreement
” shall
mean a written agreement between the Company and a Holder with
respect to an Option.
2.23
“
Performance Criteria
”
shall mean the criteria selected by the Committee for purposes of
establishing the Performance Goal(s) for a Holder for a Performance
Period.
2.24
“
Performance Goals
” shall
mean, for a Performance Period, the written goal or goals
established by the Committee for the Performance Period based upon
the Performance Criteria, which may be related to the performance
of the Holder, the Company or an Affiliate.
2.25
“
Performance Period
”
shall mean one or more periods of time, which may be of varying and
overlapping durations, selected by the Committee, over which the
attainment of the Performance Goals shall be measured for purposes
of determining a Holder’s right to, and the payment of, a
Performance Stock Award or a Performance Unit
Award.
2.26
“
Performance Stock Award
”
or “
Performance
Stock
” shall mean an Award granted under Article XII
of the Plan under which, upon the satisfaction of predetermined
Performance Goals, Shares are paid to the
Holder.
2.27
“
Performance Stock
Agreement
” shall mean a written agreement between the
Company and a Holder with respect to a Performance Stock
Award.
2.28
“
Performance Unit
” shall
mean a Unit awarded to a Holder pursuant to a Performance Unit
Award.
2.29
“
Performance Unit Award
”
shall mean an Award granted under Article XI of the Plan under
which, upon the satisfaction of predetermined Performance Goals, a
cash payment shall be made to the Holder, based on the number of
Units awarded to the Holder.
2.30
“
Performance Unit
Agreement
” shall mean a written agreement between the
Company and a Holder with respect to a Performance Unit
Award.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
2.31
“
Plan
” shall mean this
Liberated Syndication Inc. 2018 Omnibus Equity Incentive Plan, as
amended from time to time, together with each of the Award
Agreements utilized hereunder.
2.32
“
Restricted Stock Award
”
and “
Restricted
Stock
” shall mean an Award granted under Article VIII
of the Plan of Shares, the transferability of which by the Holder
is subject to Restrictions.
2.33
“
Restricted Stock
Agreement
” shall mean a written agreement between the
Company and a Holder with respect to a Restricted Stock
Award.
2.34
“
Restricted Stock Unit
Award
” and “
RSUs
” shall refer to an
Award granted under Article X of the Plan under which, upon the
satisfaction of predetermined individual service-related vesting
requirements, a cash payment shall be made to the Holder, based on
the number of Units awarded to the Holder.
2.35
“
Restricted Stock Unit
Agreement
” shall mean a written agreement between the
Company and a Holder with respect to a Restricted Stock
Award.
2.36
“
Restriction Period
”
shall mean the period of time for which Shares subject to a
Restricted Stock Award shall be subject to Restrictions, as set
forth in the applicable Restricted Stock
Agreement.
2.37
“
Restrictions
” shall mean
the forfeiture, transfer and/or other restrictions applicable to
Shares awarded to an Employee, Director or Consultant under the
Plan pursuant to a Restricted Stock Award and set forth in a
Restricted Stock Agreement.
2.38
“
Rule 16b-3
” shall mean
Rule 16b-3 promulgated by the Securities and Exchange Commission
under the Exchange Act, as such may be amended from time to time,
and any successor rule, regulation or statute fulfilling the same
or a substantially similar function.
2.39
“
Shares
” or
“
Stock
” shall mean the
common stock of the Company, par value $0.001 per
share.
2.40
“
Ten Percent Stockholder
”
shall mean an Employee who, at the time an Option is granted to him
or her, owns shares possessing more than ten percent (10%) of the
total combined voting power of all classes of shares of the Company
or of any parent corporation or subsidiary corporation thereof
(both as defined in Section 424 of the Code), within the meaning of
Section 422(b)(6) of the Code.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
2.41
“
Termination of Service
”
shall mean a termination of a Holder’s employment with, or
status as a Director or Consultant of, the Company or an Affiliate,
as applicable, for any reason, including, without limitation, Total
and Permanent Disability or death, except as provided in Section
6.4. In the event Termination of Service shall constitute a payment
event with respect to any Award subject to Code Section 409A,
Termination of Service shall only be deemed to occur upon a
“separation from service” as such term is defined under
Code Section 409A and applicable authorities.
2.42
“
Total and Permanent
Disability
” of an individual shall mean the inability
of such individual to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted or can
be expected to last for a continuous period of not less than twelve
(12) months, within the meaning of Section 22(e)(3) of the
Code.
2.43
“
Unit
” shall mean a
bookkeeping unit, which represents such monetary amount as shall be
designated by the Committee in each Performance Unit Agreement, or
represents one Share for purposes of each Restricted Stock Unit
Award.
2.44
“
Unrestricted Stock
Award
” shall mean an Award granted under Article IX of
the Plan of Shares which are not subject to
Restrictions.
2.45
“
Unrestricted Stock
Agreement
” shall mean a written agreement between the
Company and a Holder with respect to an Unrestricted Stock
Award.
ARTICLE
III
EFFECTIVE DATE OF
PLAN
The Plan shall be effective as of
the Effective Date.
ARTICLE
IV
ADMINISTRATION
4.1
Composition
of Committee
.
The Plan shall be administered by the Committee, which shall be
appointed by the Board. If necessary, in the Board’s
discretion, to comply with Rule 16b-3 under the Exchange Act or
relevant securities exchange or inter-dealer quotation service, the
Committee shall consist solely of two (2) or more Directors who are
each (i) “non-employee directors” within the meaning of
Rule 16b-3 and (ii) “independent” for purposes of any
applicable listing requirements. If a member of the Committee shall
be eligible to receive an Award under the Plan, such Committee
member shall have no authority hereunder with respect to his or her
own Award.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
4.2
Powers
.
Subject to the other provisions of the Plan, the Committee shall
have the sole authority, in its discretion, to make all
determinations under the Plan, including but not limited to (i)
determining which Employees, Directors or Consultants shall receive
an Award, (ii) the time or times when an Award shall be made (the
date of grant of an Award shall be the date on which the Award is
awarded by the Committee), (iii) what type of Award shall be
granted, (iv) the term of an Award, (v) the date or dates on which
an Award vests, (vi) the form of any payment to be made pursuant to
an Award, (vii) the terms and conditions of an Award (including the
forfeiture of the Award, and/or any financial gain, if the Holder
of the Award violates any applicable restrictive covenant thereof),
(viii) the Restrictions under a Restricted Stock Award, (ix) the
number of Shares which may be issued under an Award, (x)
Performance Goals applicable to any Award and certification of the
achievement of such goals, and (xi) the waiver of any Restrictions
or Performance Goals, subject in all cases to compliance with
applicable laws. In making such determinations the Committee may
take into account the nature of the services rendered by the
respective Employees, Directors and Consultants, their present and
potential contribution to the Company’s (or the
Affiliate’s) success and such other factors as the Committee
in its discretion may deem relevant.
4.3
Additional
Powers
. The
Committee shall have such additional powers as are delegated to it
under the other provisions of the Plan. Subject to the express
provisions of the Plan, the Committee is authorized to construe the
Plan and the respective Award Agreements executed hereunder, to
prescribe such rules and regulations relating to the Plan as it may
deem advisable to carry out the intent of the Plan, to determine
the terms, restrictions and provisions of each Award and to make
all other determinations necessary or advisable for administering
the Plan. The Committee may correct any defect or supply any
omission or reconcile any inconsistency in any Award Agreement in
the manner and to the extent the Committee shall deem necessary,
appropriate or expedient to carry it into effect. The
determinations of the Committee on the matters referred to in this
Article IV shall be conclusive and binding on the Company and all
Holders.
4.4
Committee
Action
.
Subject to compliance with all applicable laws, action by the
Committee shall require the consent of a majority of the members of
the Committee, expressed either orally at a meeting of the
Committee or in writing in the absence of a meeting. No member of
the Committee shall have any liability for any good faith action,
inaction or determination in connection with the
Plan.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
ARTICLE
V
SHARES SUBJECT TO PLAN AND
LIMITATIONS THEREON
5.1
Authorized
Shares and Award Limits
. The Committee may from time to
time grant Awards to one or more Employees, Directors and/or
Consultants determined by it to be eligible for participation in
the Plan in accordance with the provisions of Article VI.
Subject to Article XIII, the aggregate number of Shares that may be
issued under the Plan shall not exceed 3,000,000 Shares. Shares
shall be deemed to have been issued under the Plan solely to the
extent actually issued and delivered pursuant to an Award. To the
extent that an Award lapses, expires, is canceled, is terminated
unexercised or ceases to be exercisable for any reason, or the
rights of its Holder terminate, any Shares subject to such Award
shall again be available for the grant of a new Award.
Notwithstanding any provision in the Plan to the contrary, the
maximum number of Shares that may be subject to Awards of Options
under Article VII granted to any one person during any calendar
year, shall be Three Hundred Thousand (300,000) Shares (subject to
adjustment in the same manner as provided in Article XIII with
respect to Shares subject to Awards then
outstanding).
5.2
Types
of Shares
. The
Shares to be issued pursuant to the grant or exercise of an Award
may consist of authorized but unissued Shares, Shares purchased on
the open market or Shares previously issued and outstanding and
reacquired by the Company.
ARTICLE
VI
ELIGIBILITY AND TERMINATION OF
SERVICE
6.1
Eligibility
.
Awards made under the Plan may be granted solely to individuals or
entities who, at the time of grant, are Employees, Directors or
Consultants. An Award may be granted on more than one occasion to
the same Employee, Director or Consultant, and, subject to the
limitations set forth in the Plan, such Award may include, a
Non-qualified Stock Option, a Restricted Stock Award, a Restricted
Stock Unit Award, an Unrestricted Stock Award, a Performance Stock
Award, a Performance Unit Award, or any combination thereof, and
solely for Employees, an Incentive Stock
Option.
6.2
Termination
of Service
.
Except to the extent inconsistent with the terms of the applicable
Award Agreement and/or the provisions of Section 6.3 or 6.4, the
following terms and conditions shall apply with respect to a
Holder’s Termination of Service with the Company or an
Affiliate, as applicable:
(a)
The Holder’s rights, if
any, to exercise any then exercisable Options shall
terminate:
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
(i)
If such termination is for a
reason other than the Holder’s Total and Permanent Disability
or death, ninety (90) days after the date of such Termination of
Service;
(ii)
If such termination is on account
of the Holder’s Total and Permanent Disability, one (1) year
after the date of such Termination of Service;
or
(iii)
If such termination is on account
of the Holder’s death, one (1) year after the date of the
Holder’s death.
Upon such applicable date the
Holder (and such Holder’s estate, designated beneficiary or
other legal representative) shall forfeit any rights or interests
in or with respect to any such Options. Notwithstanding the
foregoing, the Committee, in its sole discretion, may provide for a
different time period in the Award Agreement, or may extend the
time period, following a Termination of Service, during which the
Holder has the right to exercise any vested Non-qualified Stock
Option, which time period may not extend beyond the expiration date
of the Award term.
(b)
In the event of a Holder’s
Termination of Service for any reason prior to the actual or deemed
satisfaction and/or lapse of the Restrictions, vesting
requirements, terms and conditions applicable to a Restricted Stock
Award and/or Restricted Stock Unit Award, such Restricted Stock
and/or RSUs shall immediately be canceled, and the Holder (and such
Holder’s estate, designated beneficiary or other legal
representative) shall forfeit any rights or interests in and with
respect to any such Restricted Stock and/or RSUs. Notwithstanding
the immediately preceding sentence, the Committee, in its sole
discretion, may determine, prior to or within thirty (30) days
after the date of such Termination of Service that all or a portion
of any such Holder’s Restricted Stock and/or RSUs shall not
be so canceled and forfeited.
6.3
Special
Termination Rule
. Except to the extent
inconsistent with the terms of the applicable Award Agreement, and
notwithstanding anything to the contrary contained in this Article
VI, if a Holder’s employment with, or status as a Director
of, the Company or an Affiliate shall terminate, and if, within
ninety (90) days of such termination, such Holder shall become a
Consultant, such Holder’s rights with respect to any Award or
portion thereof granted thereto prior to the date of such
termination may be preserved, if and to the extent determined by
the Committee in its sole discretion, as if such Holder had been a
Consultant for the entire period during which such Award or portion
thereof had been outstanding. Should the Committee effect such
determination with respect to such Holder, for all purposes of the
Plan, such Holder shall not be treated as if his or her employment
or Director status had terminated until such time as his or her
Consultant status shall terminate, in which case his or her Award,
as it may have been reduced in connection with the Holder’s
becoming a Consultant, shall be treated pursuant to the provisions
of Section 6.2, provided, however, that any such Award which is
intended to be an Incentive Stock Option shall, upon the
Holder’s no longer being an Employee, automatically convert
to a Non-qualified Stock Option. Should a Holder’s status as
a Consultant terminate, and if, within ninety (90) days of such
termination, such Holder shall become an Employee or a Director,
such Holder’s rights with respect to any Award or portion
thereof granted thereto prior to the date of such termination may
be preserved, if and to the extent determined by the Committee in
its sole discretion, as if such Holder had been an Employee or a
Director, as applicable, for the entire period during which such
Award or portion thereof had been outstanding, and, should the
Committee effect such determination with respect to such Holder,
for all purposes of the Plan, such Holder shall not be treated as
if his or her Consultant status had terminated until such time as
his or her employment with the Company or an Affiliate, or his or
her Director status, as applicable, shall terminate, in which case
his or her Award shall be treated pursuant to the provisions of
Section 6.2.
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Plan
6.4
Termination
of Service for Cause
. Notwithstanding anything in
this Article VI or elsewhere in the Plan to the contrary, and
unless a Holder’s Award Agreement specifically provides
otherwise, in the event of a Holder’s Termination of Service
for Cause, all of such Holder’s then outstanding Awards shall
expire immediately and be forfeited in their entirety upon such
Termination of Service.
ARTICLE
VII
OPTIONS
7.1
Option Period
. The term of
each Option shall be as specified in the Option Agreement;
provided
,
however
, that
except as set forth in Section 7.3, no Option shall be exercisable
after the expiration of ten (10) years from the date of its
grant.
7.2
Limitations on Exercise of
Option
. An Option shall be exercisable in whole or in such
installments and at such times as specified in the Option
Agreement.
7.3
Special Limitations on Incentive
Stock Options
. To the extent that the aggregate Fair Market
Value (determined at the time the respective Incentive Stock Option
is granted) of Shares with respect to which Incentive Stock Options
are exercisable for the first time by an individual during any
calendar year under all plans of the Company and any parent
corporation or subsidiary corporation thereof (both as defined in
Section 424 of the Code) which provide for the grant of Incentive
Stock Options exceeds One Hundred Thousand Dollars ($100,000) (or
such other individual limit as may be in effect under the Code on
the date of grant), the portion of such Incentive Stock Options
that exceeds such threshold shall be treated as Non-qualified Stock
Options. The Committee shall determine, in accordance with
applicable provisions of the Code, Treasury Regulations and other
administrative pronouncements, which of a Holder’s Options,
which were intended by the Committee to be Incentive Stock Options
when granted to the Holder, will not constitute Incentive Stock
Options because of such limitation, and shall notify the Holder of
such determination as soon as practicable after such determination.
No Incentive Stock Option shall be granted to an Employee if, at
the time the Incentive Stock Option is granted, such Employee is a
Ten Percent Stockholder, unless (i) at the time such Incentive
Stock Option is granted the Option price is at least one hundred
ten percent (110%) of the Fair Market Value of the Shares subject
to the Incentive Stock Option, and (ii) such Incentive Stock Option
by its terms is not exercisable after the expiration of five (5)
years from the date of grant. No Incentive Stock Option shall be
granted more than ten (10) years from the earlier of the Effective
Date or date on which the Plan is approved by the Company’s
stockholders. The designation by the Committee of an Option as an
Incentive Stock Option shall not guarantee the Holder that the
Option will satisfy the applicable requirements for
“incentive stock option” status under Section 422 of
the Code.
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Plan
7.4
Option Agreement
. Each Option
shall be evidenced by an Option Agreement in such form and
containing such provisions not inconsistent with the other
provisions of the Plan as the Committee from time to time shall
approve, including, but not limited to, provisions intended to
qualify an Option as an Incentive Stock Option. An Option Agreement
may provide for the payment of the Option price, in whole or in
part, by the delivery of a number of Shares (plus cash if
necessary) that have been owned by the Holder for at least six (6)
months and having a Fair Market Value equal to such Option price,
or such other forms or methods as the Committee may determine from
time to time, in each case, subject to such rules and regulations
as may be adopted by the Committee. Each Option Agreement shall,
solely to the extent inconsistent with the provisions of Sections
6.2, 6.3, and 6.4, as applicable, specify the effect of Termination
of Service on the exercisability of the Option. Moreover, without
limiting the generality of the foregoing, a Non-qualified Stock
Option Agreement may provide for a “cashless exercise”
of the Option, in whole or in part, by (a) establishing
procedures whereby the Holder, by a properly-executed written
notice, directs (i) an immediate market sale or margin loan as
to all or a part of Shares to which he is entitled to receive upon
exercise of the Option, pursuant to an extension of credit by the
Company to the Holder of the Option price, (ii) the delivery
of the Shares from the Company directly to a brokerage firm and
(iii) the delivery of the Option price from sale or margin
loan proceeds from the brokerage firm directly to the Company, or
(b) reducing the number of Shares to be issued upon exercise
of the Option by the number of such Shares having an aggregate Fair
Market Value equal to the Option price (or portion thereof to be so
paid) as of the date of the Option’s exercise. An Option
Agreement may also include provisions relating to: (i) subject
to the provisions hereof, accelerated vesting of Options, including
but not limited to, upon the occurrence of a Change of Control,
(ii) tax matters (including provisions covering any applicable
Employee wage withholding requirements and requiring additional
“gross-up” payments to Holders to meet any excise taxes
or other additional income tax liability imposed as a result of a
payment made upon a Change of Control resulting from the operation
of the Plan or of such Option Agreement) and (iii) any other
matters not inconsistent with the terms and provisions of the Plan
that the Committee shall in its sole discretion determine. The
terms and conditions of the respective Option Agreements need not
be identical.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
7.5
Option
Price and Payment
. The price at which an Share may
be purchased upon exercise of an Option shall be determined by the
Committee;
provided
,
however
, that such Option
price (i) shall not be less than the Fair Market Value of an
Share on the date such Option is granted (or 110% of Fair Market
Value for an Incentive Stock Option held by Ten Percent
Stockholder, as provided in Section 7.3), and (ii) shall be
subject to adjustment as provided in Article XIII. The Option or
portion thereof may be exercised by delivery of an irrevocable
notice of exercise to the Company. The Option price for the Option
or portion thereof shall be paid in full in the manner prescribed
by the Committee as set forth in the Plan and the applicable Option
Agreement, which manner, with the consent of the Committee, may
include the withholding of Shares otherwise issuable in connection
with the exercise of the Option. Separate share certificates shall
be issued by the Company for those Shares acquired pursuant to the
exercise of an Incentive Stock Option and for those Shares acquired
pursuant to the exercise of a Non-qualified Stock
Option.
7.6
Stockholder
Rights and Privileges
. The Holder of an Option shall
be entitled to all the privileges and rights of a stockholder of
the Company solely with respect to such Shares as have been
purchased under the Option and for which share certificates have
been registered in the Holder’s name.
7.7
Options
and Rights in Substitution for Stock or Options Granted by Other
Corporations
.
Options may be granted under the Plan from time to time in
substitution for stock options held by individuals employed by
entities who become Employees, Directors or Consultants as a result
of a merger or consolidation of the employing entity with the
Company or any Affiliate, or the acquisition by the Company or an
Affiliate of the assets of the employing entity, or the acquisition
by the Company or an Affiliate of stock or shares of the employing
entity with the result that such employing entity becomes an
Affiliate.
ARTICLE
VIII
RESTRICTED STOCK
AWARDS
8.1
Award
.
A Restricted Stock Award shall constitute an Award of Shares to the
Holder as of the date of the Award which are subject to a
“substantial risk of forfeiture” as defined under
Section 83 of the Code during the specified Restriction Period. At
the time a Restricted Stock Award is made, the Committee shall
establish the Restriction Period applicable to such Award. Each
Restricted Stock Award may have a different Restriction Period, in
the discretion of the Committee. The Restriction Period applicable
to a particular Restricted Stock Award shall not be changed except
as permitted by Section 8.2.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
8.2
Terms
and Conditions
. At the time any Award is made
under this Article VIII, the Company and the Holder shall enter
into a Restricted Stock Agreement setting forth each of the matters
contemplated thereby and such other matters as the Committee may
determine to be appropriate. The Company shall cause the Shares to
be issued in the name of Holder, either by book-entry registration
or issuance of one or more stock certificates evidencing the
Shares, which Shares or certificates shall be held by the Company
or the stock transfer agent or brokerage service selected by the
Company to provide services for the Plan. The Shares shall be
restricted from transfer and shall be subject to an appropriate
stop-transfer order, and if any certificate is issued, such
certificate shall bear an appropriate legend referring to the
restrictions applicable to the Shares. After any Shares vest, the
Company shall deliver the vested Shares, in book-entry or
certificated form in the Company’s sole discretion,
registered in the name of Holder or his or her legal
representatives, beneficiaries or heirs, as the case may be, less
any Shares withheld to pay withholding taxes. If provided for under
the Restricted Stock Agreement, the Holder shall have the right to
vote Shares subject thereto and to enjoy all other stockholder
rights, including the entitlement to receive dividends on the
Shares during the Restriction Period. At the time of such Award,
the Committee may, in its sole discretion, prescribe additional
terms and conditions or restrictions relating to Restricted Stock
Awards, including, but not limited to, rules pertaining to the
effect of Termination of Service prior to expiration of the
Restriction Period. Such additional terms, conditions or
restrictions shall, to the extent inconsistent with the provisions
of Sections 6.2, 6.3 and 6.4, as applicable, be set forth in a
Restricted Stock Agreement made in conjunction with the Award. Such
Restricted Stock Agreement may also include provisions relating to:
(i) subject to the provisions hereof, accelerated vesting of
Awards, including but not limited to accelerated vesting upon the
occurrence of a Change of Control, (ii) tax matters (including
provisions covering any applicable Employee wage withholding
requirements and requiring additional “gross-up”
payments to Holders to meet any excise taxes or other additional
income tax liability imposed as a result of a payment made in
connection with a Change of Control resulting from the operation of
the Plan or of such Restricted Stock Agreement) and (iii) any
other matters not inconsistent with the terms and provisions of the
Plan that the Committee shall in its sole discretion determine. The
terms and conditions of the respective Restricted Stock Agreements
need not be identical. All Shares delivered to a Holder as part of
a Restricted Stock Award shall be delivered and reported by the
Company or the Affiliate, as applicable, to the Holder at the time
of vesting.
8.3
Payment
for Restricted Stock
. The Committee shall determine
the amount and form of any payment from a Holder for Shares
received pursuant to a Restricted Stock Award, if any, provided
that in the absence of such a determination, a Holder shall not be
required to make any payment for Shares received pursuant to a
Restricted Stock Award, except to the extent otherwise required by
law.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
ARTICLE
IX
UNRESTRICTED STOCK
AWARDS
9.1
Award
.
Shares may be awarded (or sold) to Employees, Directors or
Consultants under the Plan which are not subject to Restrictions of
any kind, in consideration for past services rendered thereby to
the Company or an Affiliate or for other valid
consideration.
9.2
Terms
and Conditions.
At the time any Award is made
under this Article IX, the Company and the Holder shall enter into
an Unrestricted Stock Agreement setting forth each of the matters
contemplated hereby and such other matters as the Committee may
determine to be appropriate.
9.3
Payment
for Unrestricted Stock
. The Committee shall determine
the amount and form of any payment from a Holder for Shares
received pursuant to an Unrestricted Stock Award, if any, provided
that in the absence of such a determination, a Holder shall not be
required to make any payment for Shares received pursuant to an
Unrestricted Stock Award, except to the extent otherwise required
by law.
ARTICLE
X
RESTRICTED STOCK UNIT
AWARDS
10.1
Award
.
A Restricted Stock Unit Award shall constitute a promise to grant
Shares (or cash equal to the Fair Market Value of Shares) to the
Holder at the end of a specified Restriction Period. At the time a
Restricted Stock Unit Award is made, the Committee shall establish
the Restriction Period applicable to such Award. Each Restricted
Stock Unit Award may have a different Restriction Period, in the
discretion of the Committee. A Restricted Stock Unit shall not
constitute an equity interest in the Company and shall not entitle
the Holder to voting rights, dividends or any other rights
associated with ownership of Shares prior to the time the Holder
shall receive a distribution of Shares pursuant to Section
10.3.
10.2
Terms
and Conditions
. At the time any Award is made
under this Article X, the Company and the Holder shall enter into a
Restricted Stock Unit Agreement setting forth each of the matters
contemplated thereby and such other matters as the Committee may
determine to be appropriate. The Restricted Stock Unit Agreement
shall set forth the individual service-based vesting requirement
which the Holder would be required to satisfy before the Holder
would become entitled to distribution pursuant to Section 10.3 and
the number of Units awarded to the Holder. Such conditions shall be
sufficient to constitute a “substantial risk of
forfeiture” as such term is defined under Section 409A of the
Code. At the time of such Award, the Committee may, in its sole
discretion, prescribe additional terms and conditions or
restrictions relating to Restricted Stock Unit Awards in the
Restricted Stock Unit Agreement, including, but not limited to,
rules pertaining to the effect of Termination of Service prior to
expiration of the applicable vesting period. The terms and
conditions of the respective Restricted Stock Unit Agreements need
not be identical.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
10.3
Distributions
of Shares
. The
Holder of a Restricted Stock Unit shall be entitled to receive a
cash payment equal to the Fair Market Value of an Share, or one
Share, as determined in the sole discretion of the Committee and as
set forth in the Restricted Stock Unit Agreement, for each
Restricted Stock Unit subject to such Restricted Stock Unit Award,
if the Holder satisfies the applicable vesting requirement. Such
distribution shall be made no later than by the fifteenth
(15
th
) day
of the third (3
rd
) calendar month
next following the end of the calendar year in which the Restricted
Stock Unit first becomes vested (i.e., no longer subject to a
“substantial risk of forfeiture”).
ARTICLE
XI
PERFORMANCE UNIT
AWARDS
11.1
Award
.
A Performance Unit Award shall constitute an Award under which,
upon the satisfaction of predetermined individual and/or Company
(and/or Affiliate) Performance Goals based on selected Performance
Criteria, a cash payment shall be made to the Holder, based on the
number of Units awarded to the Holder. At the time a Performance
Unit Award is made, the Committee shall establish the Performance
Period and applicable Performance Goals. Each Performance Unit
Award may have different Performance Goals, in the discretion of
the Committee. A Performance Unit Award shall not constitute an
equity interest in the Company and shall not entitle the Holder to
voting rights, dividends or any other rights associated with
ownership of Shares.
11.2
Terms
and Conditions
. At the time any Award is made
under this Article XI, the Company and the Holder shall enter into
a Performance Unit Agreement setting forth each of the matters
contemplated thereby and such other matters as the Committee may
determine to be appropriate. The Committee shall set forth in the
applicable Performance Unit Agreement the Performance Period,
Performance Criteria and Performance Goals which the Holder and/or
the Company would be required to satisfy before the Holder would
become entitled to payment pursuant to Section 11.3, the number of
Units awarded to the Holder and the dollar value or formula
assigned to each such Unit. Such payment shall be subject to a
“substantial risk of forfeiture” under Section 409A of
the Code. At the time of such Award, the Committee may, in its sole
discretion, prescribe additional terms and conditions or
restrictions relating to Performance Unit Awards, including, but
not limited to, rules pertaining to the effect of Termination of
Service prior to expiration of the applicable performance period.
The terms and conditions of the respective Performance Unit
Agreements need not be identical.
11.3
Payments
.
The Holder of a Performance Unit shall be entitled to receive a
cash payment equal to the dollar value assigned to such Unit under
the applicable Performance Unit Agreement if the Holder and/or the
Company satisfy (or partially satisfy, if applicable under the
applicable Performance Unit Agreement) the Performance Goals set
forth in such Performance Unit Agreement. All payments shall be
made no later than by the fifteenth (15
th
) day of the third
(3
rd
)
calendar month next following the end of the Company’s fiscal
year to which such performance goals and objectives
relate.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
ARTICLE
XII
PERFORMANCE STOCK
AWARDS
12.1
Award
.
A Performance Stock Award shall constitute a promise to grant
Shares (or cash equal to the Fair Market Value of Shares) to the
Holder at the end of a specified Performance Period subject to
achievement of specified Performance Goals. At the time a
Performance Stock Award is made, the Committee shall establish the
Performance Period and applicable Performance Goals based on
selected Performance Criteria. Each Performance Stock Award may
have different Performance Goals, in the discretion of the
Committee. A Performance Stock Award shall not constitute an equity
interest in the Company and shall not entitle the Holder to voting
rights, dividends or any other rights associated with ownership of
Shares unless and until the Holder shall receive a distribution of
Shares pursuant to Section 11.3.
12.2
Terms
and Conditions
. At the time any Award is made
under this Article XII, the Company and the Holder shall enter into
a Performance Stock Agreement setting forth each of the matters
contemplated thereby and such other matters as the Committee may
determine to be appropriate. The Committee shall set forth in the
applicable Performance Stock Agreement the Performance Period,
selected Performance Criteria and Performance Goals which the
Holder and/or the Company would be required to satisfy before the
Holder would become entitled to the receipt of Shares pursuant to
such Holder’s Performance Stock Award and the number of
Shares subject to such Performance Stock Award. Such distribution
shall be subject to a “substantial risk of forfeiture”
under Section 409A of the Code. If such Performance Goals are
achieved, the distribution of Shares (or the payment of cash, as
determined in the sole discretion of the Committee), shall be made
no later than by the fifteenth (15
th
) day of the third
(3
rd
)
calendar month next following the end of the Company’s fiscal
year to which such goals and objectives relate. At the time of such
Award, the Committee may, in its sole discretion, prescribe
additional terms and conditions or restrictions relating to
Performance Stock Awards, including, but not limited to, rules
pertaining to the effect of the Holder’s Termination of
Service prior to the expiration of the applicable performance
period. The terms and conditions of the respective Performance
Stock Agreements need not be identical.
12.3
Distributions
of Shares
. The
Holder of a Performance Stock Award shall be entitled to receive a
cash payment equal to the Fair Market Value of a Share, or one
Share, as determined in the sole discretion of the Committee, for
each Performance Stock Award subject to such Performance Stock
Agreement, if the Holder satisfies the applicable vesting
requirement. Such distribution shall be made no later than by the
fifteenth (15
th
) day of the third
(3
rd
)
calendar month next following the end of the Company’s fiscal
year to which such performance goals and objectives
relate.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
ARTICLE
XIII
RECAPITALIZATION OR
REORGANIZATION
13.1
Adjustments
to Shares
. The
shares with respect to which Awards may be granted under the Plan
are Shares as presently constituted;
provided
,
however
, that if, and
whenever, prior to the expiration or distribution to the Holder of
Shares underlying an Award theretofore granted, the Company shall
effect a subdivision or consolidation of the Shares or the payment
of an Share dividend on Shares without receipt of consideration by
the Company, the number of Shares with respect to which such Award
may thereafter be exercised or satisfied, as applicable,
(i) in the event of an increase in the number of outstanding
Shares, shall be proportionately increased, and the purchase price
per Share shall be proportionately reduced, and (ii) in the
event of a reduction in the number of outstanding Shares, shall be
proportionately reduced, and the purchase price per Share shall be
proportionately increased. Notwithstanding the foregoing or any
other provision of this Article XIII, any adjustment made with
respect to an Award (x) which is an Incentive Stock Option, shall
comply with the requirements of Section 424(a) of the Code, and in
no event shall any adjustment be made which would render any
Incentive Stock Option granted under the Plan to be other than an
“incentive stock option” for purposes of Section 422 of
the Code, and (y) which is a Non-qualified Stock Option, shall
comply with the requirements of Section 409A of the Code, and in no
event shall any adjustment be made which would render any
Non-qualified Stock Option granted under the Plan to become subject
to Section 409A of the Code.
13.2
Recapitalization
.
If the Company recapitalizes or otherwise changes its capital
structure, thereafter upon any exercise or satisfaction, as
applicable, of a previously granted Award, the Holder shall be
entitled to receive (or entitled to purchase, if applicable) under
such Award, in lieu of the number of Shares then covered by such
Award, the number and class of shares and securities to which the
Holder would have been entitled pursuant to the terms of the
recapitalization if, immediately prior to such recapitalization,
the Holder had been the holder of record of the number of Shares
then covered by such Award.
13.3
Other
Events.
In the event of
changes to the outstanding Shares by reason of an extraordinary
cash dividend, reorganization, merger, consolidation, combination,
split-up, spin-off, exchange or other relevant change in
capitalization occurring after the date of the grant of any Award
and not otherwise provided for under this Article XIII, any
outstanding Awards and any Award Agreements evidencing such Awards
shall be adjusted by the Board in its discretion in such manner as
the Board shall deem equitable or appropriate taking into
consideration the applicable accounting and tax consequences, as to
the number and price of Shares or other consideration subject to
such Awards. In the event of any adjustment pursuant to Sections
13.1, 13.2 or this Section 13.3, the aggregate number of Shares
available under the Plan pursuant to Section 5.1 may be
appropriately adjusted by the Board, the determination of which
shall be conclusive. In addition, the Committee may make provision
for a cash payment to a Holder or a person who has an outstanding
Award.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
13.4
Change of Control
. The
Committee may, in its sole discretion, at the time an Award is made
or at any time prior to, coincident with or after the time of a
Change of Control, cause any Award either (i) to be canceled in
consideration of a payment in cash or other consideration in amount
per share equal to the excess, if any, of the price or implied
price per Share in the Change of Control over the per Share
exercise, base or purchase price of such Award, which may be paid
immediately or over the vesting schedule of the Award; (ii) to be
assumed, or new rights substituted therefore, by the surviving
corporation or a parent or subsidiary of such surviving corporation
following such Change of Control; (iii) accelerate any time
periods, or waive any other conditions, relating to the vesting,
exercise, payment or distribution of an Award so that any Award to
a Holder whose employment has been terminated as a result of a
Change of Control may be vested, exercised, paid or distributed in
full on or before a date fixed by the Committee; (iv) to be
purchased from a Holder whose employment has been terminated as a
result of a Change of Control, upon the Holder’s request, for
an amount of cash equal to the amount that could have been obtained
upon the exercise, payment or distribution of such rights had such
Award been currently exercisable or payable; or (v) terminate any
then outstanding Award or make any other adjustment to the Awards
then outstanding as the Committee deems necessary or appropriate to
reflect such transaction or change. The number of Shares subject to
any Award shall be rounded to the nearest whole
number.
13.5
Powers
Not Affected
.
The existence of the Plan and the Awards granted hereunder shall
not affect in any way the right or power of the Board or of the
stockholders of the Company to make or authorize any adjustment,
recapitalization, reorganization or other change of the
Company’s capital structure or business, any merger or
consolidation of the Company, any issue of debt or equity
securities ahead of or affecting Shares or the rights thereof, the
dissolution or liquidation of the Company or any sale, lease,
exchange or other disposition of all or any part of its assets or
business or any other corporate act or
proceeding.
13.6
No
Adjustment for Certain Awards
. Except as hereinabove expressly
provided, the issuance by the Company of shares of any class or
securities convertible into shares of any class, for cash,
property, labor or services, upon direct sale, upon the exercise of
rights or warrants to subscribe therefor or upon conversion of
shares or obligations of the Company convertible into such shares
or other securities, and in any case whether or not for fair value,
shall not affect previously granted Awards, and no adjustment by
reason thereof shall be made with respect to the number of Shares
subject to Awards theretofore granted or the purchase price per
Share, if applicable.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
ARTICLE
XIV
AMENDMENT AND TERMINATION OF
PLAN
The Plan shall continue in
effect, unless sooner terminated pursuant to this Article XIV,
until the tenth (10
th
) anniversary of the
date on which it is adopted by the Board (except as to Awards
outstanding on that date). The Board in its discretion may
terminate the Plan at any time with respect to any shares for which
Awards have not theretofore been granted;
provided
,
however
, that the Plan’s
termination shall not materially and adversely impair the rights of
a Holder with respect to any Award theretofore granted without the
consent of the Holder. The Board shall have the right to alter or
amend the Plan or any part hereof from time to time;
provided
,
however
, that without the
approval by a majority of the votes cast at a meeting of
stockholders at which a quorum representing a majority of the
shares of the Company entitled to vote generally in the election of
directors is present in person or by proxy, no amendment or
modification of the Plan may (i) materially increase the
benefits accruing to Holders, (ii) except as otherwise
expressly provided in Article XIII, materially increase the number
of Shares subject to the Plan or the individual Award Agreements
specified in Article V, (iii) materially modify the
requirements for participation in the Plan, or (iv) amend,
modify or suspend this Article XIV. In addition, no change in any
Award theretofore granted may be made which would materially and
adversely impair the rights of a Holder with respect to such Award
without the consent of the Holder (unless such change is required
in order to exempt the Plan or any Award from Section 409A of the
Code).
ARTICLE
XV
MISCELLANEOUS
15.1
No
Right to Award
. Neither the adoption of the
Plan by the Company nor any action of the Board or the Committee
shall be deemed to give an Employee, Director or Consultant any
right to an Award except as may be evidenced by an Award Agreement
duly executed on behalf of the Company, and then solely to the
extent and on the terms and conditions expressly set forth
therein.
15.2
No
Rights Conferred
. Nothing contained in the Plan
shall (i) confer upon any Employee any right with respect to
continuation of employment with the Company or any Affiliate,
(ii) interfere in any way with any right of the Company or any
Affiliate to terminate the employment of an Employee at any time,
(iii) confer upon any Director any right with respect to
continuation of such Director’s membership on the Board,
(iv) interfere in any way with any right of the Company or an
Affiliate to terminate a Director’s membership on the Board
at any time, (v) confer upon any Consultant any right with
respect to continuation of his or her consulting engagement with
the Company or any Affiliate, or (vi) interfere in any way
with any right of the Company or an Affiliate to terminate a
Consultant’s consulting engagement with the Company or an
Affiliate at any time.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
15.3
Other
Laws; No Fractional Shares; Withholding
. The Company shall not be
obligated by virtue of any provision of the Plan to recognize the
exercise of any Award or to otherwise sell or issue Shares in
violation of any laws, rules or regulations, and any postponement
of the exercise or settlement of any Award under this provision
shall not extend the term of such Award. Neither the Company nor
its directors or officers shall have any obligation or liability to
a Holder with respect to any Award (or Shares issuable thereunder)
(i) that shall lapse because of such postponement, or
(ii) for any failure to comply with the requirements of any
applicable law, rules or regulations, including but not limited to
any failure to comply with the requirements of Section 409A of this
Code. No fractional Shares shall be delivered, nor shall any cash
in lieu of fractional Shares be paid. The Company shall have the
right to deduct in cash (whether under this Plan or otherwise) in
connection with all Awards any taxes required by law to be withheld
and to require any payments required to enable it to satisfy its
withholding obligations. In the case of any Award satisfied in the
form of Shares, no Shares shall be issued unless and until
arrangements satisfactory to the Company shall have been made to
satisfy any tax withholding obligations applicable with respect to
such Award. Subject to such terms and conditions as the Committee
may impose, the Company shall have the right to retain, or the
Committee may, subject to such terms and conditions as it may
establish from time to time, permit Holders to elect to tender,
Shares (including Shares issuable in respect of an Award) to
satisfy, in whole or in part, the amount required to be
withheld.
15.4
No
Restriction on Corporate Action
. Nothing contained in the Plan
shall be construed to prevent the Company or any Affiliate from
taking any corporate action which is deemed by the Company or such
Affiliate to be appropriate or in its best interest, whether or not
such action would have an adverse effect on the Plan or any Award
made under the Plan. No Employee, Director, Consultant, beneficiary
or other person shall have any claim against the Company or any
Affiliate as a result of any such action.
15.5
Restrictions
on Transfer
.
No Award under the Plan or any Award Agreement and no rights or
interests herein or therein, shall or may be assigned, transferred,
sold, exchanged, encumbered, pledged or otherwise hypothecated or
disposed of by a Holder except (i) by will or by the laws of
descent and distribution, or (ii) where permitted under
applicable tax rules, by gift to any Family Member of the Holder,
subject to compliance with applicable laws. An Award may be
exercisable during the lifetime of the Holder only by such Holder
or by the Holder’s guardian or legal representative unless it
has been transferred by gift to a Family Member of the Holder, in
which case it shall be exercisable solely by such transferee.
Notwithstanding any such transfer, the Holder shall continue to be
subject to the withholding requirements provided for under
Section 15.3 hereof.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
15.6
Beneficiary
Designations
.
Each Holder may, from time to time, name a beneficiary or
beneficiaries (who may be contingent or successive beneficiaries)
for purposes of receiving any amount which is payable in connection
with an Award under the Plan upon or subsequent to the
Holder’s death. Each such beneficiary designation shall serve
to revoke all prior beneficiary designations, be in a form
prescribed by the Company and be effective solely when filed by the
Holder in writing with the Company during the Holder’s
lifetime. In the absence of any such written beneficiary
designation, for purposes of the Plan, a Holder’s beneficiary
shall be the Holder’s estate.
15.7
Rule
16b-3
. It is
intended that the Plan and any Award made to a person subject to
Section 16 of the Exchange Act shall meet all of the requirements
of Rule 16b-3. If any provision of the Plan or of any such
Award would disqualify the Plan or such Award under, or would
otherwise not comply with the requirements of, Rule 16b-3,
such provision or Award shall be construed or deemed to have been
amended as necessary to conform to the requirements of
Rule 16b-3.
15.8
Clawback Policy
.
Notwithstanding any contained herein or in any incentive
“performance based” Awards under the Plan shall be
subject to reduction, forfeiture or repayment by reason of a
correction or restatement of the Company’s financial
information if and to the extent such reduction or repayment is
required by any applicable law.
15.9
Section
409A
.
Notwithstanding any other provision of the Plan, the Committee
shall have no authority to issue an Award under the Plan with terms
and/or conditions which would cause such Award to constitute
non-qualified “deferred compensation” under
Section 409A of the Code unless such Award shall be structured
to be exempt from or comply with all requirements of Code Section
409A. The Plan and all Award Agreements are intended to comply with
the requirements of Section 409A of the Code (or to be exempt
therefrom) and shall be so interpreted and construed and no amount
shall be paid or distributed from the Plan unless and until such
payment complies with all requirements of Code Section 409A. It is
the intent of the Company that the provisions of this Agreement and
all other plans and programs sponsored by the Company be
interpreted to comply in all respects with Code Section 409A,
however, the Company shall have no liability to the Holder, or any
successor or beneficiary thereof, in the event taxes, penalties or
excise taxes may ultimately be determined to be applicable to any
payment or benefit received by the Holder or any successor or
beneficiary thereof.
Liberated Syndication Inc. 2018 Omnibus Equity Incentive
Plan
15.10
Indemnification
.
Each person who is or shall have been a member of the Committee or
of the Board shall be indemnified and held harmless by the Company
against and from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred thereby in connection with or
resulting from any claim, action, suit, or proceeding to which such
person may be made a party or may be involved by reason of any
action taken or failure to act under the Plan and against and from
any and all amounts paid thereby in settlement thereof, with the
Company’s approval, or paid thereby in satisfaction of any
judgment in any such action, suit, or proceeding against such
person;
provided
,
however
, that such
person shall give the Company an opportunity, at its own expense,
to handle and defend the same before he or she undertakes to handle
and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive and shall be independent of
any other rights of indemnification to which such persons may be
entitled under the Company’s Articles of Incorporation or
By-laws, by contract, as a matter of law, or
otherwise.
15.11
Other
Benefit Plans
.
No Award, payment or amount received hereunder shall be taken into
account in computing an Employee’s salary or compensation for
the purposes of determining any benefits under any pension,
retirement, life insurance or other benefit plan of the Company or
any Affiliate, unless such other plan specifically provides for the
inclusion of such Award, payment or amount received. Nothing in the
Plan shall be construed to limit the right of the Company to
establish other plans or to pay compensation to its employees, in
cash or property, in a manner which is not expressly authorized
under the Plan.
15.12
Limits
of Liability
.
Any liability of the Company with respect to an Award shall be
based solely upon the contractual obligations created under the
Plan and the Award Agreement. None of the Company, any member of
the Board nor any member of the Committee shall have any liability
to any party for any action taken or not taken, in good faith, in
connection with or under the Plan.
15.13
Governing
Law
. Except as
otherwise provided herein, the Plan shall be construed in
accordance with the laws of the State of Nevada, without regard to
principles of conflicts of law.
15.14
Severability
of Provisions
.
If any provision of the Plan is held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provision
of the Plan, and the Plan shall be construed and enforced as if
such invalid or unenforceable provision had not been included in
the Plan.
15.15
No
Funding
. 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 funds or assets to ensure the payment of any Award.
Prior to receipt of Shares or a cash distribution pursuant to the
terms of an Award, such Award shall represent an unfunded unsecured
contractual obligation of the Company and the Holder shall have no
greater claim to the Shares underlying such Award or any other
assets of the Company or Affiliate than any other unsecured general
creditor.
15.16
Headings
.
Headings used throughout the Plan are for convenience only and
shall not be given legal significance.