ADT 2008 Annual Report Download - page 97

(b) Shares related to Awards that expire, are forfeited or cancelled, or terminate for any
other reason without issuance of Shares;
(c) Shares that are tendered or withheld in payment of all or part of the Exercise Price of a
Stock Option awarded under this Plan, or in satisfaction of withholding tax obligations arising
under this Plan;
(d) Any Shares issued in connection with Awards that are assumed, converted or substituted
as a result of the acquisition of an Acquired Company by the Company or a combination of the
Company with another company; and
(e) Any Shares of Restricted Stock that are returned to the Company upon a Participant’s
Termination of Employment.
5.3 Adjustments. In the event of a change in the outstanding Shares by reason of a stock split,
reverse stock split, dividend or other distribution (whether in the form of cash, Shares, other securities
or other property), extraordinary cash dividend, recapitalization, merger, consolidation, split-up,
spin-off, reorganization, combination, repurchase or exchange of Shares or other securities or similar
corporate transaction or event, the Committee shall make an appropriate adjustment to prevent
dilution or enlargement of the benefits or potential benefits intended to be made available under the
Plan. Any such adjustment with respect to Nonqualified Stock Options and Stock Appreciation Rights
shall satisfy the requirements of Treas. Reg. § 1.409A-1(b)(5)(v)(D) and otherwise ensure that such
awards continue to be exempt from Code Section 409A and provided that any adjustment to Awards
that are subject to Code Section 409A is in compliance with Code Section 409A and the regulations
and rulings thereunder. Any adjustment made by the Committee under this Section 5.3 will be
conclusive and binding for all purposes under the Plan.
5.4 Change in Control.
(a) Acceleration. All outstanding Stock Options and Stock Appreciation Rights will become
exercisable as of the later of the effective date of a Change in Control or a Change in Control
Termination for any Employee whose employment is terminated by means of a Change in Control
Termination if the Awards are not otherwise vested, and all conditions will be waived with respect to
outstanding Restricted Stock and Restricted Units (other than Long-Term Performance Awards) and
Deferred Stock Units in such case. Each Participant who has been granted a Long-Term Performance
Award that is outstanding as of the date of Change in Control, and whose employment is terminated
by means of a Change in Control Termination, will be deemed to have achieved a level of
performance, as of later of the date of the Change in Control or the Change in Control Termination,
that would cause all (100%) of the Participant’s Target Amounts to become payable and all
restrictions on the Participant’s Restricted Units and Shares of Restricted Stock to lapse.
(b) Adjustment, Conversion and Payment. In addition to the foregoing, no later than 90 days
after the date of Change in Control, the Committee (as constituted prior to the date of Change in
Control) shall provide for the following actions to apply to each Award that is outstanding as of
the date of Change in Control: (i) an adjustment to such Award as the Committee deems
appropriate to reflect such Change in Control, (ii) the acquisition of such Award, or substitution of
a new right therefor, by the acquiring or surviving corporation after such Change in Control, or
(iii) the purchase of such Award, at the Participant’s request, for an amount of cash equal to the
amount that could have been attained upon the exercise or redemption of such Award immediately
prior to the Change in Control had such Award been exercisable or payable at such time;
provided, that in the case of any Award that constitutes deferred compensation that is subject to
Code Section 409A(a)(2), any action contemplated herein which would constitute an accelerated
payment of such Award shall occur on a date specified in the applicable Award Certificate, which
date shall be no later than ninety (90) days after the Change in Control. Any payment made
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