Exhibit 10.1

 

INERGY EMPLOYEE UNIT PURCHASE PLAN

(AS AMENDED AND RESTATED)

 

SECTION 1

INTRODUCTION

 

1.1 Establishment. INERGY HOLDINGS, LLC, a Delaware limited liability company
(“Holdings”), originally established, effective June 1, 2001, the Inergy
Employee Unit Purchase Plan (the “Plan”) for certain employees of Holdings,
Inergy GP, LLC, a Delaware limited liability company (the “General Partner”),
Inergy, L.P., a Delaware limited partnership (the “Partnership”), and their
Affiliates (collectively “Inergy”). The Plan was subsequently amended and
restated effective as of the Plan’s original effective date, June 1, 2001. The
Plan was amended and restated for a second time to reflect its sponsorship by
the General Partner and, for a third time, to give Employees the ability to stop
contributing to the Plan prior to an upcoming Purchase Period and still have all
amounts contributed to such Employee’s notional account as of such date be
applied toward the purchase of Units. The Plan is hereby amended and restated
for a fourth time to permit all employees of Inergy to participate in the Plan.

 

1.2 Purpose. The purpose of the Plan is to promote the interests of Inergy by
encouraging all Inergy employees to acquire or increase their ownership of Units
and to provide a means whereby such individuals may develop a sense of
proprietorship and personal involvement in the development and financial success
of Inergy, and to encourage them to devote their best efforts to advance the
interests of Inergy.

 

SECTION 2

DEFINITIONS

 

2.1 In addition to the terms otherwise defined herein, the following terms shall
have the meanings set forth below in this Section 2.1.

 

  (a) “1933 Act” means the Securities Act of 1933, as amended.

 

  (b) “1934 Act” means the Securities Exchange Act of 1934, as amended.

 

  (c) “Affiliates” means with respect to any Person, any other Person that
directly or indirectly through one or more intermediaries controls, is
controlled by or is under common control with, the Person in question. As used
herein, the term “control” means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of a
Person, whether through ownership of voting securities, by contract or
otherwise.

 

  (d) “Board” means the Board of Directors of the General Partner.

 

  (e) “Committee” means the compensation committee of the Board appointed to
administer the Plan pursuant to Section 8.

 

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  (f) “Compensation” shall mean an Employee’s cash-based salary or cash-based
wages.

 

  (g) “Employee” means any individual who is an employee of Holdings, the
General Partner or one of their Affiliates, but excluding any employee covered
by a collective bargaining agreement unless such bargaining agreement provides
for his participation in the Plan.

 

  (h) “Fair Market Value” means the closing sales price of a Unit on the
applicable date (or if there is no trading in the Units on such date, on the
next preceding date on which there was trading) as reported in The Wall Street
Journal (or other reporting service approved by the Committee). In the event
Units are not publicly traded at the time a determination of fair market value
is required to be made hereunder, the determination of fair market value shall
be made in good faith by the Committee.

 

  (i) “Offering Period” means the period each calendar quarter (i) that begins
on the date immediately following the last day of the immediately preceding
Purchase Period and ends on the first day of the immediately following Purchase
Period and (ii) during which a percentage of an Employee’s Compensation is
withheld and accumulated for the purchase of Units in the immediately upcoming
Purchase Period.

 

  (j) “Partnership Agreement” means the Amended and Restated Agreement of
Limited Partnership of Inergy, L.P., as amended from time to time.

 

  (k) “Person” means an individual or a corporation, limited liability company,
partnership, joint venture, trust, unincorporated organization, association,
governmental agency or political subdivision thereof or other entity.

 

  (l) “Purchase Period” means the 10-day period following the end of each
calendar quarter; provided, however, the Purchase Period shall include such
other periods, if any, as may be designated by the Committee from time to time.

 

  (m) “Rule 16b-3” means Rule 16b-3 promulgated under the 1934 Act.

 

  (n) “Unit” means a Common Unit of the Partnership.

 

2.2 Gender and Number. Except when otherwise indicated by the context, the
masculine gender shall also include the feminine gender, and the definition of
any term herein in the singular shall also include the plural.

 

SECTION 3

ELIGIBILITY

 

3.1 Eligibility and Plan Entry Date. All Employees shall be eligible to
participate in the Plan. An Employee is eligible to enter the Plan beginning on
the first day of the month following thirty (30) days after such individual’s
employment commencement date.

 

3.2 Prior Service Credit. The Committee, in its discretion, may grant prior
service credit to individuals that become Employees pursuant to a corporate
merger or acquisition.

 

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SECTION 4

UNITS AVAILABLE UNDER PLAN

 

4.1 Unless otherwise increased by the Board, the maximum number of Units that
may be purchased for Employees under this Plan is 50,000. Units to be delivered
under the Plan may be Units acquired by Inergy in the open market, Units already
owned by Inergy, Units acquired by Inergy from any other person, or any
combination of the foregoing. Upon an Employee’s termination of employment with
Inergy, all amounts then credited to the Employee’s notional account under the
Plan, if any, shall be paid to the terminated Employee as soon as practicable.
In the event that any change is made to the Units deliverable under the Plan,
the Committee may make appropriate adjustments in the maximum number of Units
deliverable under the Plan. The adjustments determined by the Committee shall be
final, binding and conclusive.

 

SECTION 5

PURCHASE OF UNITS

 

5.1 Employee Withholding Elections. The Committee shall provide an Employee with
the ability to purchase Units under this Plan in accordance with the following
terms and conditions:

 

  (a) Effective as of the beginning of any month, an Employee may elect to have
Inergy withhold from the Employee’s Compensation each future pay period, for the
purchase of Units hereunder, a designated percentage of the Employee’s
Compensation (in whole percentages only, not to exceed 10%). An Employee may
change (within the above limitations) or, subject to Section 5.1(f), stop his
withholding election at any time; however, only two such changes may be made
during any calendar year. All Employee elections and any changes to an election
shall be in such written form as the Committee or its delegate may establish
from time to time.

 

  (b) Each withholding election made by an Employee hereunder shall be an
ongoing election until the earlier of the date changed by the Employee or the
date the Employee ceases to be eligible to participate in the Plan.

 

  (c) Inergy shall maintain for each electing Employee a separate notional or
ledger account reflecting the aggregate amount of the Employee’s Compensation
that has been withheld and not yet applied to the purchase of Units for such
Employee. Amounts withheld by Inergy shall not be segregated from Inergy’s
general assets and shall not bear interest.

 

  (d) During each Purchase Period, Inergy shall use, to the fullest extent
practicable, all amounts then credited to the notional accounts of the electing
Employees to purchase Units for such Employees. Purchases of Units may be made
at any time or times during the Purchase Period on any securities exchange on
which the Units are then traded, in the over-the-counter market and/or in
negotiated transactions as the Committee shall determine.

 

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  (e) Upon an Employee’s termination of employment with Inergy, all amounts then
credited to the Employee’s notional account under the Plan, if any, shall be
paid to the terminated Employee as soon as reasonably practicable.

 

  (f) Subject to the limitation provided above in Section 5.1(a), an Employee
may elect to cease contributing to the Plan. Provided an Employee submits his or
her election to stop withholding prior to the five business day period before
the beginning of an immediately upcoming Purchase Period, the Employee may elect
to cease contributing to the Plan and either (i) have all amounts then credited
to such Employee’s notional account returned to the Employee as soon as
administratively practicable, or (ii) alternatively, have all amounts then
credited to such Employee’s notional account applied toward the purchase of
Units in the immediately upcoming Purchase Period. Unless otherwise
administratively feasible, to the extent an Employee submits his or her election
to stop withholding within the five business day period before the beginning of
the immediately upcoming Purchase Period, all amounts credited to such
Employee’s notional account will be applied toward the purchase of Units in the
immediately following Purchase Period and the Employee’s election to stop
withholding shall become effective as of the commencement of the next following
Offering Period. All requests to withdraw from the Plan submitted during a
Purchase Period will become effective as of the commencement of the immediately
following Offering Period.

 

5.2 Purchase of Units and Plan Expenses. During each Purchase Period and using
funds withheld from the Employees’ Compensation pursuant to this Section 5,
Inergy shall purchase for the electing Employees the maximum number of Units
(including fractional Units) that can be acquired (using the Unit’s Fair Market
Value on the date of purchase) based on the sum of (i) amounts then credited to
the electing Employees’ notional accounts, and (ii) an amount, as determined
from time to time by the Committee, not to exceed 10% of the amount then
credited to the electing Employees’ notional accounts. Inergy shall pay, other
than from the notional accounts, all brokerage fees and other costs and expenses
of the Plan. To the extent that Units are purchased on multiple days or at
multiple times during a single Purchase Period, Inergy shall use the average of
the Units’ Fair Market Value at the times of purchase as the applicable Unit
price upon which Units are allocated to the participating Employees.
Notwithstanding that fractional Units may be allocated to an Employee’s account,
an Employee who does not have at least one whole Unit credited to his account at
the beginning of a Purchase Period must have enough money credited to his
notional account to purchase at least one whole Unit. To the extent an Employee
does not have enough cash funds credited to his notional account to purchase at
least one whole Unit, all amounts credited to such Employee’s notional account
will be held in a suspense account until such time as there are enough funds for
the purchase of at least one whole Unit.

 

5.3

Withholding of Taxes. To the extent that Inergy is required to withhold any
taxes in connection with the purchase of Units, it will be a condition to the
ownership of such Units that the Employee make arrangements satisfactory to
Inergy for the payment of

 

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such taxes, which may include, but not be limited to, a reduction in the
Employee’s notional account.

 

SECTION 6

RESTRICTIONS ON UNITS

 

6.1 Holding Period. Subject to the exception provided below under Section 6.2,
all Units purchased under the Plan shall be subject to a holding period which
shall expire on the first anniversary of the date the Units were purchased under
the Plan. During such holding period, each Employee shall be prohibited from
pledging, transferring, selling or otherwise disposing of the restricted Units.
Upon the expiration of the holding period, the Employee may, if he or she
desires, make a request to Inergy (or a designated third party Plan
administrator, if any) to receive certificates for all of such unrestricted
whole Units. Otherwise, such Units shall be held without restriction (1) by
Inergy or (2) in the name of the third party administrator (or its designee), if
any, for the benefit of the Employee.

 

6.2 Holding Period Exception. Notwithstanding the holding period imposed above
under Section 6.1 and subject to the conditions imposed pursuant to this Section
6.2, an Employee will be permitted to pledge, transfer, sell or otherwise
dispose of his or her restricted whole Units during the one year holding period
(a “Restricted Transfer”) by notifying Inergy (or its designated third party
Plan administrator) of his or her intention to engage in a Restricted Transfer.
If a Restricted Transfer occurs, the Employee shall be prohibited from
participating in the Plan until the first Offering Period that begins after the
first anniversary of the date of the Restricted Transfer (the “Restricted
Period”). During the Restricted Period, no amounts shall be withheld from the
Employee’s Compensation. Such withholding shall not be allowed to resume, at the
earliest, until the first pay period in the Offering Period first commencing
after the end of the Restricted Period. To the extent an Employee has amounts
credited to his or her notional account under the Plan on the date of a
Restricted Transfer, all such amounts will be returned to the Participant. To
the extent a Participant has a fractional Unit credited to his or her notional
account under the Plan on the date of a Restricted Transfer, such fractional
Unit will be liquidated and the Participant will receive his pro rata portion of
the proceeds from such liquidation.

 

6.3 Investment Representation. Unless the Units subject to purchase under the
Plan have been registered under the 1933 Act and, in the case of any Employee
who may be deemed an affiliate (for securities law purposes) of Holdings, the
General Partner or the Partnership, such Units have been registered under the
1933 Act for resale by such Participant or Inergy has determined that an
exemption from registration is available, Inergy may require prior to and as a
condition of the delivery of any Units that the person purchasing such Units
hereunder furnish Inergy with a written representation in a form prescribed by
the Committee to the effect that such person is acquiring such Units solely with
a view to investment for his or her own account and not with a view to the
resale or distribution of all or any part thereof, and that such person will not
dispose of any of such Units otherwise than in accordance with the provisions of
Rule 144 under the 1933 Act unless and until either the Units are registered
under the 1933 Act or Inergy is satisfied that an exemption from such
registration is available.

 

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6.4 Compliance with Securities Laws. Notwithstanding anything herein or in any
other agreement to the contrary, Inergy shall not be obligated to sell or issue
any Units to an Employee under the Plan unless and until Inergy is satisfied
that such sale or issuance complies with (i) all applicable requirements of the
securities exchange on which the Units are traded (or the governing body of the
principal market in which such Units are traded, if such Units are not then
listed on an exchange), (ii) all applicable provisions of the 1933 Act, and
(iii) all other laws or regulations by which Inergy is bound or to which Inergy
is subject.

 

SECTION 7

RIGHTS OF EMPLOYEES; PARTICIPANTS

 

7.1 Employment. This Plan does not confer upon any Employee any right with
respect to continuance of employment or other service with Inergy, nor will it
interfere in any way with any right Inergy would otherwise have to terminate
such Employee’s employment or other service at any time.

 

7.2 Nontransferability. No right to purchase Units granted under this Plan shall
be assignable or transferable during the lifetime of any Employee either
voluntarily or involuntarily, or be subjected to any lien, directly or
indirectly, by operation of law, or otherwise, including execution, levy,
garnishment, attachment, pledge or bankruptcy.

 

7.3 Dividend Reinvestment. To the extent that Inergy has a dividend reinvestment
plan available to Unit holders, Employees purchasing Units pursuant to this Plan
shall be eligible to participate in such dividend reinvestment plan in the same
manner as other Unit holders.

 

SECTION 8

PLAN ADMINISTRATION

 

8.1 Authority of Committee. The Plan shall be administered by the Committee.
Subject to the terms of the Plan and applicable law, and in addition to other
express powers and authorizations conferred on the Committee by the Plan, the
Committee shall have full power and authority to: (i) determine which persons
are Employees who may participate; (ii) determine the number of Units to be
purchased by an Employee; (iii) determine the time and manner for purchasing
Units; (iv) interpret, construe and administer the Plan; (v) establish, amend,
suspend, or waive such rules and regulations and appoint such agents as it shall
deem appropriate for the proper administration of the Plan; (vi) make a
determination as to the right of any person to receive Units under the Plan;
(vii) correct any defect, supply any omission, or reconcile an inconsistency in
the Plan; and (viii) make any other determinations and take any other actions
that the Committee deems necessary or desirable for the administration of the
Plan.

 

8.2

Determination Under the Plan. Unless otherwise expressly provided in the Plan,
all designations, determinations, interpretations, and other decisions under or
with respect to the Plan shall be within the sole discretion of the Committee,
may be made at any time, and shall be final, conclusive, and binding upon all
persons, including any Employee. No member of the Committee shall be liable for
any action, determination or interpretation made in good faith, and all members
of the Committee shall, in addition to their rights as

 

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directors, be fully protected by Inergy with respect to any such action,
determination or interpretation.

 

SECTION 9

PLAN AMENDMENT, MODIFICATION AND TERMINATION

 

9.1 This Plan may be amended from time to time by the Committee. This Plan may
be terminated at any time by the Committee and, unless Board approval is
obtained for an increase in the maximum number of available Units, shall
automatically terminate when all Units authorized for purchase pursuant to the
Plan have been purchased. On termination of the Plan, all amounts then remaining
credited to the notional accounts of Employees shall be returned to such
Employees.

 

SECTION 10

NONEXCLUSIVITY OF THE PLAN

 

10.1 The sponsorship of the Plan by the General Partner shall not be construed
as creating any limitations on the power or authority of Inergy to adopt such
other or additional incentive or other compensation arrangements of whatever
nature as Inergy may deem necessary or desirable or preclude or limit the
continuation of any other plan, practice or arrangement for the payment of
compensation or fringe benefits to employees, non-employee directors, or
consultants generally, or to any class or group of employees, directors, or
consultants, which Inergy now has lawfully put into effect, including, without
limitation, any retirement, pension, savings and stock purchase plan, insurance,
death and disability benefits and executive short-term incentive plans.

 

SECTION 11

REQUIREMENTS OF LAW

 

11.1 Requirements of Law. The issuance of Units pursuant to the Plan shall be
subject to all applicable laws, rules and regulations.

 

11.2 Rule 16b-3. It is intended that any purchases by a person subject to
Section 16 of the 1934 Act meet all of the requirements of Rule 16b-3. If any
action or procedure would otherwise not comply with Rule 16b-3, such action or
procedure shall be modified, to the extent the Committee deems practicable, to
conform to Rule 16b-3.

 

11.3 Governing Law. The validity, construction and effect of the Plan and any
rules and regulations relating to the Plan shall be determined in accordance
with applicable Federal law, and to the extent not preempted thereby, with the
laws of the State of Delaware, without regard to conflicts of laws principles.

 

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