Kroger 2013 Annual Report Download - page 53

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In฀addition฀to฀other฀rights฀of฀indemnification฀they฀may฀have฀as฀directors฀or฀employees฀of฀Kroger,฀members฀
of฀the฀Committee฀will฀be฀indemnified฀by฀Kroger฀for฀reasonable฀expenses฀incurred฀in฀connection฀with฀defense฀
of฀any฀action฀brought฀against฀them฀by฀reason฀of฀action฀taken฀or฀failure฀to฀act฀under฀or฀in฀connection฀with฀the฀
Plan฀or฀any฀grant฀or฀award฀thereunder,฀if฀the฀members฀acted฀in฀good฀faith฀and฀in฀a฀manner฀that฀they฀believed฀
to฀be฀in฀the฀best฀interest฀of฀Kroger.
The฀ Board฀ of฀ Directors฀ may฀ terminate฀ or฀ amend฀ the฀ Plan฀ at฀ any฀ time฀ without฀ shareholder฀ approval,฀
except฀that฀it฀may฀not฀amend฀the฀Plan฀without฀shareholder฀approval฀if฀required฀by฀applicable฀law,฀regulations,฀
or฀rules฀of฀the฀principal฀exchange฀or฀interdealer฀quotation฀system฀on฀which฀Kroger’s฀common฀shares฀are฀listed฀
or฀quoted.฀Unless฀earlier฀terminated฀by฀the฀Board฀of฀Directors,฀the฀Plan฀will฀terminate฀on฀March฀13,฀2024.฀
Termination฀of฀the฀Plan฀will฀have฀no฀effect฀on฀the฀validity฀of฀any฀options,฀stock฀appreciation฀rights,฀performance฀
units,฀restricted฀stock฀or฀incentive฀shares฀outstanding฀on฀the฀date฀of฀termination.
Unless฀otherwise฀provided฀in฀the฀agreement,฀awards฀and฀grants฀will฀not฀be฀transferable฀other฀than฀by฀
will฀or฀the฀laws฀of฀descent฀and฀distribution.
Shares Subject to Grant.฀ Under฀ the฀ Plan,฀ up฀ to฀ 25,000,000฀ authorized฀ but฀ unissued฀ or฀ reacquired฀
common฀shares฀may฀be฀issued฀upon฀the฀exercise฀of฀stock฀options,฀stock฀appreciation฀rights,฀performance฀
units,฀or฀awarded฀as฀restricted฀stock฀or฀incentive฀shares.฀In฀no฀event฀may฀any฀participant฀receive฀awards฀and฀
grants฀totaling฀more฀than฀3,750,000฀common฀shares฀in฀the฀aggregate฀under฀the฀Plan.฀The฀maximum฀number฀
of฀shares฀ that฀may฀ be฀issued฀as฀ restricted฀ stock,฀incentive฀ shares,฀ or฀performance฀units฀ under฀the฀ Plan฀ is฀
10,000,000฀in฀the฀aggregate.฀However,฀the฀Committee฀under฀the฀Insider฀Program฀may฀increase฀this฀number,฀
but฀for฀each฀share฀issued฀for฀such฀purpose฀in฀excess฀of฀10,000,000,฀the฀number฀of฀shares฀that฀may฀be฀issued฀
under฀the฀Plan฀will฀be฀reduced฀by฀four฀shares.
If฀an฀option,฀stock฀appreciation฀right,฀or฀performance฀unit฀expires฀or฀terminates฀without฀having฀been฀
fully฀issued,฀or฀if฀restricted฀stock฀or฀incentive฀shares฀are฀not฀issued฀or฀are฀forfeited฀prior฀to฀the฀payment฀of฀a฀
dividend฀on฀those฀shares฀to฀a฀participant,฀the฀shares฀not฀exercised,฀unissued฀or฀forfeited,฀as฀the฀case฀may฀be,฀
will฀generally฀become฀available฀for฀other฀grants฀or฀awards฀under฀the฀Plan.
Stock Options.฀Nonstatutory฀stock฀options฀granted฀under฀the฀Plan฀will฀have฀exercise฀prices฀not฀less฀than฀
the฀greater฀of฀the฀fair฀market฀value฀per฀common฀share฀or฀the฀par฀value฀of฀a฀common฀share,฀a฀term฀of฀not฀more฀
than฀10฀years฀after฀the฀date฀of฀grant,฀and฀may฀not฀be฀exercised฀before฀six฀months฀from฀the฀date฀of฀grant.฀The฀
Plan฀prohibits฀the฀“repricing”฀of฀stock฀options.฀Subject฀to฀the฀terms฀of฀the฀Plan,฀the฀Committee฀determines฀the฀
vesting฀schedule฀and฀other฀terms฀and฀conditions฀applicable฀to฀stock฀options฀granted฀to฀employees.฀In฀recent฀
years,฀option฀grants฀generally฀have฀not฀become฀exercisable฀earlier฀than฀one฀year฀from฀the฀date฀of฀grant.฀An฀
eligible฀participant฀may฀receive฀more฀than฀one฀grant฀of฀options.
The Committee may in its discretion provide for the payment of the option exercise price otherwise than
in฀cash,฀including฀by฀delivery฀of฀common฀shares,฀valued฀at฀their฀fair฀market฀value฀on฀the฀date฀of฀exercise,฀or฀
by฀a฀combination฀of฀both฀cash฀and฀common฀shares.
Stock Appreciation Rights.฀Stock฀appreciation฀rights฀may฀be฀granted฀in฀connection฀with฀the฀grant฀of฀a฀
nonstatutory฀option฀under฀the฀Plan฀(“related฀rights”).฀In฀the฀Committee’s฀sole฀discretion,฀a฀related฀right฀may฀
apply฀to฀all฀or฀a฀portion฀of฀the฀common฀shares฀subject฀to฀the฀related฀option.฀Stock฀appreciation฀rights฀may฀
also฀be฀granted฀independently฀of฀any฀option฀granted฀under฀the฀Plan.฀A฀stock฀appreciation฀right฀entitles฀the฀
grantee฀upon฀exercise฀to฀elect฀to฀receive฀in฀cash,฀common฀shares฀or฀a฀combination฀thereof,฀the฀excess฀of฀the฀
fair฀market฀value฀of฀a฀specified฀number฀of฀common฀shares฀at฀the฀time฀of฀exercise฀over฀the฀fair฀market฀value฀
of฀such฀number฀of฀shares฀at฀the฀time฀of฀grant,฀or,฀in฀the฀case฀of฀a฀related฀right,฀the฀exercise฀price฀provided฀in฀
the฀related฀option.฀To฀the฀extent฀required฀to฀comply฀with฀the฀requirements฀of฀Rule฀16b-3฀under฀the฀Exchange฀
Act or otherwise provided in an agreement under the Plan, the Committee will have sole discretion to consent
to฀or฀disapprove฀the฀election฀of฀any฀grantee฀to฀receive฀cash฀in฀full฀or฀partial฀settlement฀of฀a฀right.฀A฀stock฀
appreciation฀right฀generally฀will฀not฀be฀exercisable฀until฀at฀least฀six฀months฀from฀the฀date฀of฀grant฀and฀will฀
have฀a฀term฀of฀not฀more฀than฀ten฀years฀from฀the฀date฀of฀grant฀(or,฀in฀the฀case฀of฀a฀related฀right,฀not฀beyond฀the฀
expiration฀of฀the฀related฀option).฀The฀Plan฀prohibits฀the฀“repricing”฀of฀stock฀appreciation฀rights.