Exhibit
10.3
CoStar
Group, Inc. 2007 Stock Incentive Plan
(Amended
effective December 6, 2007)
French
Sub-Plan
The Board
of Directors (the “Board”) of
CoStar Group, Inc. (the “Company”)
has established and the Company’s shareholders have approved, effective April
26, 2007 and until April 26, 2017, the CoStar Group, Inc. 2007
Stock Incentive Plan (the “US Plan”)
for the benefit of certain employees and non-employee directors of the Company
and its subsidiaries, in order to attract, retain, and motivate such employees
and non-employee directors and further align their interest with those of the
shareholders of the Company. The US Plan provides for, inter alia, the grant of
Restricted Stock (as defined below), which may be
performance-based. Section 16 of the US Plan authorizes the
Board or the committee designated by the Board to administer the US Plan (in
either case, the “Plan
Administrator”), to prescribe, amend and rescind rules and regulations
relating to the US Plan, and to define terms not otherwise defined in the US
Plan. Section 17 of the US Plan allows the Board to make certain
amendments to the US Plan in furtherance of its purposes as described
above.
The Board and the Plan Administrator have determined that it is
advisable to establish a sub-plan (the “French
Sub-Plan”), including insofar as necessary and appropriate to amend the
US Plan, for the purpose of permitting grants of Restricted Stock to employees
and managing directors of any French subsidiary, or French
branch of any non-French subsidiary, of which the Company holds directly or
indirectly at least 10% of the share capital (a “French
Entity”), so that such grants can qualify for favorable tax and social
security treatment in France.
The Board
has therefore established this French Sub-plan, effective for a term beginning
on December 6, 2007 and ending on April 26, 2017 or such earlier date as the US
Plan is terminated, for the purpose of permitting grants of Restricted Stock
which will qualify for the favorable tax and social security treatment in France
applicable to shares granted for no consideration under
Sections L. 225-197-1 to L. 225-197-5 of the French Commercial
Code, as amended (“French-Qualified
Restricted Stock”) to qualifying employees and managing directors who are
resident in France for French tax purposes (“French
Participants” and each a “French
Participant”).
The
Common Shares of the Company are listed on NASDAQ which is a regulated
securities exchange within the meaning of Article L.225-197-1 II of the French
Commercial Code.
The terms
of the US Plan applicable to Restricted Stock, as set out in Appendix 1
hereto, shall, subject to the modifications set forth in this French Sub-Plan
which shall prevail over the terms of the US Plan in the event of conflict,
constitute the terms applicable for grants of Restricted Stock to French
Participants.
Under the
French Sub-Plan, French Participants may receive grants only of Restricted Stock
as defined in Section 2 (r) of the US Plan and the term “Award” under this
French Sub-Plan shall refer only to an award or grant of Restricted
Stock. The provisions of the US Plan permitting the grant of stock
Options, Restricted Stock Units, or Stock Appreciation Rights shall not apply to
French Participants under this French Sub-Plan.
Capitalized
terms not otherwise defined in this French Sub-Plan shall have the same meanings
as set forth in the US Plan. The terms set out below will have the
following meanings:
(a) Blackout
Periods.
The term
“Blackout
Periods” shall mean the periods
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(i)
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from
the tenth (10th) trading day preceding through the tenth (10th) trading
day following the date on which the consolidated accounts or annual
corporate accounts of the Company are made public, and from the date on
which the governing bodies of the Company have knowledge of information
which, if made public, would have a significant impact on the market price
of the Common Shares through the tenth (10th) trading day after such
information has been made public;
or
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(ii)
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or
such other black-out periods applicable to the sale of Common Shares of
the Company under US legislation or imposed by the Company which provides
protection against insider trading comparable to that provided by Section
L. 225-197-1 of the French Commercial
Code.
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(b) Date of
Grant.
The term
“Date of
Grant” shall be the date, which shall be specified in an agreement
between the French Participant and the Company in substantially the form
attached hereto (an “ Award Agreement”), on which the Plan Administrator grants
the French Participant rights to a specified number of Common Shares, subject to
the terms and conditions of this French Sub-Plan and the Award
Agreement.
(c) Restricted
Stock.
The term
“Restricted
Stock” shall mean Common Shares of the Company, rights to which are
granted to a Participant conditional on certain vesting and/or forfeiture
requirements, transfer restrictions and other terms and conditions provided in
this French Sub-Plan. For the avoidance of doubt, it is specified
that no dividend or voting rights shall attach to Restricted Stock under this
French Sub-Plan until such Restricted Stock has vested.
(d) Vest
Date.
The term
“Vest
Date” shall mean the date on which the Common Shares subject to the
Restricted Stock Award become non-forfeitable. Such Vest Date or Vest
Dates, as well as the performance criteria if any or other conditions for Common
Shares to become non-forfeitable, shall be specified in the Award
Agreement.
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3.
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Eligibility to
Participate and Limitations.
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(a) Subject
to Sections 3(b) and (c) below, any French Participant who, on the Date of Grant
of the Restricted Stock, is either employed under an employment contract with a
French Entity (“contrat de
travail”) or who is a managing director of a French Entity, shall be
eligible to receive, at the discretion of the Plan Administrator, Restricted
Stock under this French Sub-Plan, provided that he or she also satisfies the
eligibility conditions of the US Plan.
(b) Restricted
Stock may not be issued to a director who is not also an employee of a French
Entity, except in the case of managing directors (e.g., Président, Directeur
Général, Directeur Général Délégué, Membre du Directoire,
Gérant). For the avoidance of doubt, Restricted Stock may not be
issued under this French Sub-Plan to a consultant or advisor to a French
Entity.
(c) No Award
of Restricted Stock may be made under this French Sub-Plan to any individual who
already owns on the Date of Grant, or which would have the effect of such
individual owning as of the Date of Grant, more than ten percent (10%) of the
Company’s share capital.
(d) No Award
of Restricted Stock may be made under this French Sub-Plan at such time as the
number of Common Shares of the Company which are subject to outstanding vested
Restricted Stock Awards exceeds ten percent (10%) of the Company’s corporate
capital within the meaning Article L225-197-1 – I of the French Commercial
Code.
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4.
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Conditions
of the Restricted Stock Awards.
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(a) Award of Restricted
Stock.
An Award
of Restricted Stock shall confer on a French Participant the right to acquire
Common Shares, subject to certain vesting and/or forfeiture requirements,
transfer restrictions and other terms and conditions provided in this French
Sub-Plan, for no consideration or for nominal (“symbolique”) consideration as
permitted for French-Qualified Restricted Stock.
When the
Plan Administrator makes an Award of Restricted Stock to a French Participant
under this French Sub-Plan, the terms and conditions of such Award shall be set
forth in the Award Agreement, including without limitation the number of Common
Shares subject to such Award, the conditions for the vesting or forfeiture of
the Restricted Stock including any applicable performance or continuing service
criteria, and the restrictions on transferability of the Restricted Stock once
vested.
An Award
of Restricted Stock under this French Sub-Plan shall confer neither voting
rights nor dividend rights on the French Participant until such Restricted Stock
has vested, and no dividends or dividend equivalents relating to the period
prior to vesting shall be payable to a French Participant after the Vest
Date.
(b) Vesting of Restricted
Stock.
No
Restricted Stock shall vest unless the holder of the Restricted Stock has been
an employee or managing director of the Company or a French Entity from the Date
of Grant through the date which would otherwise be the Vest Date, and the Board
or Plan Administrator may also set performance or achievement criteria as
provided in Section 12 of the Plan for vesting of Restricted
Stock. Notwithstanding the foregoing, the first Vest Date of
French-Qualified Restricted Stock shall not occur, and no Restricted Stock shall
vest, prior to the expiration of a two-year period running from the Date of
Grant, or such other period as is required to comply with the minimum mandatory
vesting period applicable to French-Qualified Restricted Stock under
Section L. 225-197-1 of the French Commercial Code, as
amended.
(c) Holding and Sale of
French-Qualified Restricted Stock.
The sale
of Restricted Stock may not occur prior to the expiration of a two-year period
running from the Vest Date, or such other period as is required to comply with
the minimum mandatory holding period under Section L. 225-197-1 of the
French Commercial Code as amended, as applicable to employees or managing
directors of subsidiaries of issuers of French-Qualified Restricted
Stock.
This
minimum holding period shall be deemed to have been complied with if, as a
result of a merger, spin-off, tender-offer, split-off or similar reorganization,
shares are received in exchange for vested Restricted Stock, and such shares are
held for the unexpired balance of the holding period which was applicable to the
Restricted Stock exchanged.
Notwithstanding
any other provision of this French Sub-Plan, Common Shares acquired under
Restricted Stock Awards may not be sold by a French Participant during a
Blackout Period, so long as and to the extent Blackout Periods are applicable to
French-Qualified Restricted Stock issued by non-French companies.
(d) French Participant’s
Account.
Each
Award of Restricted Stock shall be recorded in an account with the Company, in
the name of the French Participant and specifying the number of Common Shares
which are the subject of such Award, but such Common Shares shall not be issued
to, nor title recorded in the name of, the French Participant until the Vest
Date. Following the Vest Date, certificates representing Common
Shares which have vested shall be issued in the name of the French Participant
but, for the period during which such Common Shares shall be subject to transfer
restrictions under this French Sub-Plan, the certificates shall remain in the
custody of the Company or its transfer agent, or be held in such other manner as
the Company may otherwise determine in order to ensure compliance with the
minimum holding periods specified above and under applicable French law. At the
Participant's request, the Plan Administrator shall provide or shall ensure that
the Company or its transfer agent has provided the Participant with written
evidence of the Participant's ownership of the vested Common
Shares.
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5.
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Adjustments to Common
Shares.
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In the
event an equitable adjustment in the Common Shares of the Company is available
under the US Plan as described in Section 11 thereof, adjustments to the
number and kind of Restricted Stock subject to Awards under this French Sub-Plan
shall be made (excluding, for the avoidance of doubt, any adjustment resulting
in acceleration of a Vest Date) to the extent permitted for French-Qualified
Restricted Stock.
Upon the
Company’s receipt within six months following the death of a French Participant
of a written request from such French Participant’s heirs in a form satisfactory
to the Company, the Company shall transfer any vested and at the sole discretion
of the Plan Administrator to the extent permitted by French law for
French-Qualified Restricted Stock, any unvested Restricted Stock awarded to such
French Participant to his or her heirs, who shall not be required to comply with
any further vesting conditions or restrictions on the sale of such shares,
unless compliance is required for French-Qualified Restricted Stock treatment
under French law as amended.
In the
event a French Participant becomes disabled as defined within the second or
third categories of disability defined in Article L341-4 of the French Code of
Social Security, the rules set forth in the preceding paragraph with respect to
death of a French Participant shall apply mutatis
mutandis.
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7.
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Reporting Obligations
and Withholding.
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The
French Entity and French Participants shall comply with all reporting
obligations imposed under French tax and social security laws and regulations
with respect to Restricted Stock Awards under this French Sub-Plan, including
without limitation the French Entity’s obligation to report to URSSAF the
identity of French Participants for whom Awards vested in the preceding calendar
year as well as the number and value of Awards for each such French
Participant.
For the
avoidance of doubt, the provisions of Section 15 of the US Plan relating to
satisfaction of tax obligations shall in the case of a French Participant apply
to withholding of French social security and similar mandatory contributions, as
well as French tax if any with respect to Restricted Stock Awards under this
French Sub-Plan.
It is
intended that Restricted Stock Awards made under this French Sub-Plan shall
qualify as French-Qualified Restricted Stock. The terms of this
French Sub-Plan shall be construed and interpreted
accordingly. Insofar as legally permissible the Plan Administrator
shall be entitled to construe and interpret the terms of this French Sub-Plan so
as to comply with the relevant guidelines published from time to time by French
tax and social security administrations with respect to the conditions for
favorable tax and social security treatment applicable to shares granted for no
consideration under the Sections L. 225-197-1 to L. 225-197-5 of
the French Commercial Code, as amended.
The
adoption of this French Sub-Plan shall not confer upon the French Participants,
or any employees or managing directors of a French Entity, any employment rights
and shall not be construed as part of any employment contracts that a French
Entity has with its employees.
In the
event of any differences between the English language and French language
versions of any documents related to this French Sub-Plan or the US Plan, the
English version shall control.
This
French Sub-Plan was adopted by the Board of Directors of the Company and became
effective on December 6, 2007.