Common use of Retention Pool Clause in Contracts

Retention Pool. (a) At the Effective Time, Parent shall establish a stock option pool to purchase an aggregate of not less than 500,000 Parent Shares to retain Company employees following the Closing. As soon as practicable after Closing, Parent shall issue to the employees of the Company named on a retention schedule (the "Retention Schedule") to be determined by Parent and the Company as soon as practicable, but in no event later than twenty (20) days from the date of this Agreement, options to purchase all of the Parent Shares reserved pursuant to the preceding sentence at a per share exercise price equal to the market price of the Parent Shares on the date of the grant for purposes of Parent's stock option plan (the "Retention Parent Stock Options"). Each Retention Parent Stock Option shall vest in sixteen (16) equal quarterly installments at the end of each calendar quarter over forty-eight (48) months from the date of grant. (b) At the Effective Time, Parent shall establish a cash bonus pool of $5,000,000 (the "Retention Cash") to retain Company employees following the Closing. At a time or times to be mutually agreed between the Company and Parent, but in no event later than March 31, 2001, Parent shall pay the Retention Cash to the Company employees named on the Retention Schedule, in the respective amounts set forth on the Retention Schedule. If the employment of any such employee ceases as a result of a termination without Cause by Parent or one of its Subsidiaries or if there is a Change in Control of Parent, all of the Retention Cash allocated for such employee shall immediately vest and be paid to such employee. (c) Prior to the Effective Time, pursuant to a restricted stock plan reasonably acceptable to Parent, the Company shall issue to employees of the Company and its Subsidiaries named on the Retention Schedule to be agreed upon by the Company and Parent in writing prior to the Effective Time an aggregate number of shares of Company Common Stock (the "Retention Pool Shares") equal to the quotient obtained by dividing 500,000 by the Exchange Ratio. The Retention Pool Shares shall be allocated among the employees listed on the Retention Schedule in the amounts set forth in the Retention Schedule for each such employee. The restricted stock plan governing the Retention Pool Shares shall provide for vesting of share awards in equal installments at the end of the twelfth (12th), twenty-fourth (24th), and thirty-sixth (36th) months after the later of the date of award or the Effective Time of the Merger, for forfeiture if the employee seeks to exercise dissenter's rights with respect to any Company Capital Stock owned by such employee or if the employment of such employee ceases for any reason other than a result of termination without Cause by the Company or any successor, for immediate vesting in the event of termination without Cause and for other normal provisions of restricted stock plans. Subject to applicable income tax withholding requirements, one-third of the Parent Shares issued in respect of the Retention Pool Shares allocated for an employee who is, other than as a result of termination without Cause by Parent or one of its Subsidiaries, continuously employed by Parent and its Subsidiaries (including the Company and its subsidiaries) from the Effective Time through the end of the twelfth (12th) month after and including the month in which the Effective Time occurs, shall, on the last day of such twelfth (12th) month, be vested in and released for such employee, one-third of the Parent Shares issued in respect of the Retention Pool Shares allocated for an employee who is, other than as a result of termination without Cause by Parent or one of its Subsidiaries, continuously employed by Parent and its Subsidiaries (including the Company and its subsidiaries) from the Effective Time through the end of the twenty-fourth (24th) month after and including the month in which the Effective Time occurs, shall, on the last day of such twenty-fourth (24th) month, be vested in and released for such employee, and the remaining one-third of the Parent Shares issued in respect of the Retention Pool Shares allocated to an employee who is continuously so employed, other than as a result of termination without Cause by Parent or one of its Subsidiaries, from the Effective Time through the end of the thirty-sixth (36th) month after and including the month in which the Effective Time occurs shall, on the last day of such thirty-sixth (36th) month, be vested in and released to such employee. If the employment by Parent or any of its Subsidiaries of an employee to whom any Retention Pool Shares have been allocated ceases for any reason other than termination by Parent or such Subsidiary without Cause, all of the Parent Shares issued in respect of the Retention Pool Shares allocated to such employee that have not vested as of the date of such cessation shall be forfeited and become treasury stock of Parent. If the employment of any such employee ceases as a result of termination without Cause by Parent or one of its Subsidiaries or if there is a Change in Control of Parent, all of the Parent Shares issued in respect of the Retention Pool Shares allocated to such employee shall immediately vest and be released to such employee.