Common use of Share Ownership Guidelines Clause in Contracts

Share Ownership Guidelines. The Company has adopted share ownership guidelines to further align directors and named executive officers (as named in the Company’s most current proxy statement) with the interests of shareholders. Non-employee directors, within five years of their appointment to the Board, are required to hold an equity interest in the Company having a value of at least five times (5x) the director’s annual retainer. Named executive officers are subject to the following guidelines within five years of being appointed to the position in question: (i) the CEO is required to hold an equity interest in the Company having a value of at least six times (6x) his or her base salary; (ii) all Executive Vice Presidents and the Chief Operating Officer are required to hold an equity interest in the Company having a value of at least two times (2x) his or her base salary; and (iii) each other named executive officer is required to hold an equity interest in the Company having a value of at least one times (1x) his or her base salary. In the event that a named executive officer is not in compliance with these guidelines, the officer shall be subject to a holding period for all equity interests of the Company he or she owns, except as required to satisfy tax withholding obligations, until he or she meets these guidelines. Thereafter, he or she may sell equity of the Company so long as compliance with these guidelines is maintained. For purposes of these guidelines, “equity interest” means the Company’s publicly traded shares (a) owned directly (including through open market purchases or acquired and held upon vesting of equity awards under a Company plan); (b) owned indirectly, if the individual has an economic interest in the shares (including shares owned jointly with or separately by the individual’s spouse or held in trust for the benefit of the individual, the individual’s spouse and/or children); (c) deliverable upon settlement of equity awards under a Company plan, excluding options and the portion of any award that remains subject to achievement of performance goals; and (d) held in a 401 (k) plan and any deferred compensation accounts. For purposes of these guidelines, equity interests shall be valued at the greater of: (a) with respect to shares underlying unvested equity interests awarded under a Company plan, the closing price of the Company’s shares on the date of award of the equity interest; and (b) with respect to any equity interest, including shares underlying unvested equity interests awarded under a Company plan, the closing price of the Company’s shares on the last trading day of the prior calendar year or on the trading day immediately preceding the date on which compliance with these guidelines is determined, whichever is higher. For purposes of these guidelines, in the event a director or an officer who has met the ownership guidelines but whose ownership subsequently falls below the guidelines due to a decline in the price of the Company’s publicly traded shares and not to sales of equity interests, such director or officer will be deemed to remain in compliance until the price of the Company’s shares returns to a level at which he or she meets the guidelines.