Exhibit 10.1

PAUL C. VARGA

JULY 25, 2013

SPECIAL RESTRICTED STOCK AWARD AGREEMENT

 

   SUMMARY Participant:    Paul C. Varga Award Date:    July 25, 2013
Performance Period    May 1, 2013 through April 30, 2018 Restriction Ending
Date:    June 1, 2018 Number of Shares Subject to Award:    67,513 Class of
Shares:    Brown-Forman Corporation Class A Common Stock Award Date Price per
Share:    $74.06

THIS AWARD (the “Award”), effective as of the Award Date set forth above,
represents a grant of Shares of restricted stock by Brown-Forman Corporation, a
Delaware corporation (the “Company”), under the Company’s 2013 Omnibus
Compensation Plan (the “Plan”) to the Company employee named above
(“Participant”). Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Plan.

1. Award. The Company hereby grants to the Participant, subject to the terms and
conditions set forth herein, the number of Shares of restricted stock set forth
in the summary table above (the “Restricted Stock”). The Restricted Stock shall
be issued in the name of the Participant, legended with the appropriate
restriction, and held in escrow by the Company or its agent. Upon the vesting of
the Restricted Stock in accordance with Section 2 of this Award, and the
satisfaction of applicable withholding requirements under federal, state, local
and foreign law, the Company shall issue or cause to be delivered to the
Participant one or more unlegended stock certificates in respect of such vested
Shares.

2. Vesting. The Restricted Stock shall vest, and the restrictions on the
Restricted Stock shall be removed and unrestricted vested Shares shall be
delivered to the Participant in accordance with Section 1 of this Award,
provided that, both: (i) the Participant remains continuously employed by the
Company through the end of the Performance Period (except as provided in
Section 4 of this Award) (the “Service Condition”), and (ii) as of the
Restriction Ending Date, the Plan Administrator certifies that the Company has
achieved at least $3 billion of cumulative operating income (determined in
accordance with US GAAP) over the Performance Period (the “Performance
Condition”). For the avoidance of doubt, except as otherwise provided in
Section 4 of this Award, in the event that it ceases to be possible for both the
Service Condition and the Performance Condition to be met as of the Restriction
Ending Date, all of the Restricted Stock shall be immediately canceled and
forfeited to the Company, without compensation to the Participant.

3. Negative Discretion. Notwithstanding anything to the contrary in Section 2 of
this Award, the Plan Administrator shall have the discretion to adjust downward
for any reason the number of Shares of Restricted Stock that shall vest and be
issued in unlegended form to the Participant, including, but not limited to,
performance considerations other than achievement of the Performance Condition.
Without limiting the generality of the foregoing, it is currently anticipated
that the Plan Administrator will consider the following three factors, weighted
relative to each other in accordance with the approximate percentages set forth
next to each factor, in determining whether to make an adjustment pursuant to
this paragraph: (i) the Company’s annual revenue growth during the Performance
Period (25%), (ii) the Company’s return on invested capital during the
Performance Period relative to its peer group (25%), and

 

Page 1 of 6

--------------------------------------------------------------------------------

(iii) the Participant’s performance with respect to the Company’s long-term
senior leadership succession planning (50%). The Plan Administrator shall have
sole discretion to determine how to evaluate performance in respect of such
factors or any other performance factors, although it is anticipated that if
overall performance is deemed to be at or above target, no downward adjustment
shall be made pursuant to this paragraph. The Plan Administrator’s
determinations in accordance with this Section 3 shall be final, conclusive and
binding.

4. Termination of Employment. In the event the Participant does not remain
continuously employed by the Company through April 30, 2018, the following rules
will apply:

4.1 Death/Disability. If the Participant dies or terminates employment due to
Disability (“Disability” to be determined by the Plan Administrator in its sole
discretion in accordance with Section 2.16 of the Plan), the Restricted Stock
shall vest immediately as to a prorated portion of Restricted Stock, such
proration to be based on a fraction, the numerator of which is the number of
whole months that the Participant was employed during the Performance Period
prior to the Participant’s termination of employment, and the denominator of
which is 60; provided, that, the Plan Administrator shall retain its discretion
to adjust downwards the number of Shares of Restricted Stock that vest and are
issued in unlegended form to the Participant as provided in Section 3 of this
Award. The unlegended stock certificate(s) in respect of such vested Shares
shall be issued or delivered to the Participant or the Participant’s
beneficiary(ies) within thirty (30) days of the Participant’s death or
termination of employment due to Disability, with the issuance or delivery date
within such period to be determined by the Company in its sole discretion. Any
unvested portion of the Restricted Stock shall be immediately canceled and
forfeited.

4.2 Voluntary Termination, Involuntary Termination for Cause, Involuntary
Termination for Poor Performance. All of the Restricted Stock shall be
immediately forfeited to the Company, without compensation to the Participant,
in the event of the Participant’s voluntary termination, involuntary termination
for Cause (as such term is defined in the Plan), or involuntary termination for
poor performance (as determined by the Plan Administrator in its sole
discretion) prior to the Restriction Ending Date.

4.3. Involuntary Termination – “No Fault”; Termination for any Other Reasons. If
the Participant’s employment is involuntarily terminated with “no fault” on the
part of the Participant (as determined by the Plan Administrator in its sole
discretion), or if the Participant’s employment terminates for any reason other
than those set out in Sections 4.1 and 4.2 of this Award, in each case, prior to
the Restriction Ending Date, all of the Restricted Stock shall be immediately
forfeited to the Company, without compensation to the Participant.
Notwithstanding the foregoing, the Plan Administrator may determine, in its sole
discretion, that a prorated portion of the Restricted Stock shall remain
outstanding following the Participant’s termination of employment and shall vest
on the Restriction Ending Date, subject to achievement of the Performance
Condition, such proration to be based on a fraction, the numerator of which is
the number of whole months that the Participant was employed during the
Performance Period prior to the Participant’s termination of employment, and the
denominator of which is 60. The Plan Administrator shall retain its discretion
to adjust downwards the number of Shares of Restricted Stock that vest and are
issued or delivered to the Participant as provided in Section 3 of this Award.
Any unvested portion of the Restricted Stock shall be immediately canceled and
forfeited.

5. Change in Control. Upon the occurrence of a Change in Control, as defined in
the Plan, the Restricted Stock shall be treated in accordance with Article 11 of
the Plan.

 

Page 2 of 6

--------------------------------------------------------------------------------

6. Rights as a Stockholder; Dividends. The Participant shall have full voting
rights as a stockholder of the Company with respect to the Restricted Stock
during the period in which such Restricted Stock remains subject to a
substantial risk of forfeiture. During the Performance Period, the Participant
shall be credited with regular cash dividends paid with respect to the Shares of
Restricted Stock, which shall be accrued in Shares of Class A Common Stock (the
amount of which shall be determined by dividing the amount of dividend that
would have been payable in respect of the Restricted Stock by the Fair Market
Value on the dividend payment date) and held in escrow by the Company or its
agent until the Restricted Stock vests in accordance with Section 2 of this
Award, at which time one or more unlegended stock certificates in respect of
such Shares shall be issued or delivered to the Participant (subject to the
satisfaction of applicable withholding requirements under federal, state, local
and foreign law). In the event all or a portion of the underlying Restricted
Stock is forfeited, any corresponding Shares accrued pursuant to this Section 6
shall be concurrently forfeited.

7. Restrictions on Transfer. Prior to the Restriction Ending Date and the
removal of the restrictions on the Restricted Stock, the Shares of Restricted
Stock may not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution.

8. Recapitalization. If there is any change in the Company’s Shares through the
declaration of stock dividends, a recapitalization, stock splits, or through
merger, consolidation, exchange of Shares, or otherwise, or in the event of an
extraordinary dividend or other corporate transaction, the Plan Administrator
shall adjust the number and class of Shares subject to this Award (including by
making a different kind or class of securities subject to the Award), and/or the
Performance Condition, as the Plan Administrator deems necessary to prevent
dilution or enlargement of rights.

9. Beneficiary Designation. The Participant may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to
whom any benefit under this Award is to be paid in case of his or her death
before he or she receives any or all of such benefit. Each such designation
shall revoke all prior designations by the Participant, shall be in a form
prescribed by the Company, and will be effective only when delivered during the
Participant’s lifetime to the Company at its executive offices, addressed to the
attention of the Compensation Department in Louisville, Kentucky.

10. Continuation of Employment. This Award shall not confer upon the Participant
any right to continued employment by the Company, nor shall this Award interfere
in any way with the Company’s right to terminate the Participant’s employment at
any time. A transfer of the Participant’s employment between the Company and any
of its subsidiaries, or between any divisions or subsidiaries of the Company
shall not be deemed a termination of employment.

11. Miscellaneous.

 

  A)

This Award and the Participant’s rights under it are subject to all the terms
and conditions of the Plan and this Restricted Stock Award Agreement, as they
may be amended from time to time, as well as to such rules as the Plan
Administrator may adopt. The Plan Administrator may impose such restrictions on
this Award as it may deem advisable, including, without limitation, restrictions
under applicable Federal securities laws, under the requirements of any stock
exchange or market upon which such Shares are then listed and/or traded, and
under any blue sky or state securities laws applicable to such Shares. The
Restricted Stock shall be subject to the requirements that, if at any time the
Plan Administrator shall determine that (i) the listing, registration or
qualification of Class A Common Stock subject or related thereto upon any
securities exchange or under any federal or state law, or (ii) the consent or
approval of any governmental body, or (iii) an agreement by the Participant with
respect to the disposition of Shares of Class A Common Stock is necessary or
desirable as a condition of, or

 

Page 3 of 6

--------------------------------------------------------------------------------

  in connection with, the delivery or purchase of Shares pursuant thereto, then
in such event, the grant of Restricted Stock shall not be effective unless such
listing, registration, qualification, consent, approval or agreement shall have
been effected or obtained free of any conditions not acceptable to the Plan
Administrator.

The Plan Administrator may administer, construe, and make all determinations
necessary or appropriate to the administration of the Plan and this Award, all
of which shall be binding upon the Participant.

 

  B) Subject to the provisions of the Plan, the Board of Directors may
terminate, amend, or modify the Plan; provided, however, that no such
termination, amendment, or modification of the Plan may in any way adversely
affect the Participant’s rights under this Award, without the written consent of
the Participant. This Award may not be modified, amended or waived except by an
instrument in writing signed by both parties hereto. The waiver by either party
of compliance with any provision of this Award shall not operate or be construed
as a waiver of any other provision of this Award, or of any subsequent breach by
such party of a provision of this Award.

 

  C) The Company may deduct or withhold, or require the Participant to remit to
the Company, an amount sufficient to satisfy federal, state, and local taxes
(including the Participant’s FICA obligation) required by law to be withheld
with respect to any exercise of the Participant’s rights under this Award.

The Participant may remit sufficient cash to the Company to satisfy the
withholding requirement or the Participant may elect to satisfy the withholding
requirement, in whole or in part, by having the Company withhold Shares having
an aggregate Fair Market Value, on the date the tax is to be determined, equal
to the minimum amount required to be withheld. Such elections shall be
irrevocable, shall be in writing, and shall be signed by the Participant before
the day that the transaction becomes taxable.

 

  D) The Participant agrees to take all steps necessary to comply with all
applicable federal and state securities law in exercising his rights under this
Award.

 

  E) This Award shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.

 

  F) The Company’s obligations under the Plan and this Award shall bind any
successor to the Company, whether succession results from a direct or indirect
purchase, merger, consolidation, or otherwise, of all or substantially all of
the business and/or assets of the Company.

 

  G) To the extent not preempted by federal law, this Award shall be governed
by, and construed in accordance with, the laws of the State of Delaware.

 

  H) For so long as IRC Section 162(m) applies in respect of compensation to the
Participant, this Award shall comply with the requirements for satisfaction of
the performance-based exception to such section, unless the Plan Administrator
determines that compliance is not desired or necessary for any Award or Awards.

 

Page 4 of 6

--------------------------------------------------------------------------------

  I) The parties acknowledge and agree that, to the extent applicable, this
Award shall be interpreted in accordance with, and the parties agree to use
their best efforts to achieve timely compliance with, Section 409A of the Code
and the Treasury Regulations and other interpretive guidance issued thereunder.
Notwithstanding any provision of this Award to the contrary, in the event that
the Company determines that any compensation or benefits payable or provided
under this Award may be subject to Section 409A of the Code, the Company may
adopt such limited amendments to this Award and appropriate policies and
procedures, including amendments and policies with retroactive effect, that the
Company reasonably determines are necessary or appropriate to (i) exempt the
compensation and benefits payable under this Award from Section 409A of the Code
and/or preserve the intended tax treatment of the compensation and benefits
provided with respect to this Award or (ii) comply with the requirements of
Section 409A of the Code.

Notwithstanding any other provision of this Award, to the extent the issuance of
the Restricted Stock represented by this Award following the Performance Period
does not qualify as a “short term deferral” pursuant to Section 1.409A-1(b)(4)
(or any other exception to Section 409A) and is treated as non-qualified
deferred compensation subject to Section 409A of the Code, then (a) no delivery
of Shares hereunder shall be made upon a Participant’s termination of employment
unless such termination of employment constitutes a “separation from service”
within the meaning of Section 1.409A-1(h) of the Treasury Regulations and (b) if
the Participant is deemed at the time of his termination of employment to be a
“specified employee” for purposes of Section 409A(a)(2)(B)(i) of the Code, then
to the extent delayed delivery of Shares to which the Participant is entitled
under this Award, and which is deliverable to the Participant due to his
termination of employment, is required in order to avoid a prohibited
distribution under Section 409A(a)(2)(B)(i) of the Code, such delivery of Shares
shall not be made to the Participant prior to the earlier of (x) the expiration
of the six-month period measured from the date of the Participant’s “separation
from service” with the Company (as such term is defined in Section 1.409A-1(h)
of the Treasury Regulations) or (y) the date of the Participant’s death. The
determination of whether the Participant is a “specified employee” for purposes
of Section 409A(a)(2)(B)(i) of the Code as of the time of his separation from
service shall be made by the Company in accordance with the terms of
Section 409A of the Code and applicable guidance thereunder (including without
limitation Section 1.409A-1(i) of the Treasury Regulations and any successor
provision thereto).

Although the Company intends to take such actions so as to allow the Award to
avoid adverse tax treatment pursuant to Section 409A of the Code and otherwise,
the Company makes no representation to that effect and expressly disavows any
covenant to maintain favorable or avoid unfavorable tax treatment. The Company
shall be unconstrained in its corporate activities without regard to the
potential negative tax impact on the Participant.

 

  J) This Award is subject to the terms of the Plan and Administrative
Guidelines promulgated under it from time to time. In the event of a conflict
between this document and the Plan, the Plan document as well as any
determinations made by the Plan Administrator as authorized by the Plan
document, shall govern.

 

  K) The invalidity or unenforceability of any provision of this Award shall not
affect the validity or enforceability of any other provision of this Award.

 

Page 5 of 6

--------------------------------------------------------------------------------

  L) THIS AWARD IS SUBJECT TO THE BROWN-FORMAN CORPORATION INCENTIVE
COMPENSATION RECOUPMENT POLICY. BY EXECUTION HEREOF, THE UNDERSIGNED
ACKNOWLEDGES THAT HE HAS BEEN PROVIDED WITH A COPY OF SUCH INCENTIVE
COMPENSATION RECOUPMENT POLICY AND UNDERSTANDS THE TERMS AND CONDITIONS THEREOF.

IN WITNESS WHEREOF, the parties have caused this Award to be executed as of the
Award Date.

BROWN-FORMAN CORPORATION

 

By:   /s/ Lisa Steiner  

Lisa Steiner

Senior Vice President,

Chief Human Resources Officer

 

Agreed and Accepted: /s/ Paul C. Varga Paul C. Varga

 

Page 6 of 6