Exhibit 10.6

 

 

MANNING & NAPIER, INC.

2011 EQUITY COMPENSATION PLAN

 

 

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MANNING & NAPIER, INC.

2011 EQUITY COMPENSATION PLAN

1. Purpose

Manning & Napier, Inc. and Manning & Napier Group, LLC hereby adopt this
Manning & Napier, Inc. 2011 Equity Compensation Plan effective as of
November 23, 2011. This Plan is intended to encourage equity ownership of the
Company and MN Group by persons providing services to the Company, MN Group
and/or its subsidiaries, including directors, employees, advisers and
consultants of the Company, MN Group and/or their subsidiaries, and to provide
additional incentives for them to promote the success of the business of the
Company and MN Group.

2. Definitions

As used in this Plan, the following terms shall have the following meanings:

2.1 Accelerate, when used with respect to an Award (other than Restricted Stock
or Restricted Units), means that as of the time of reference the Award will vest
and, if applicable, will become exercisable with respect to some or all of the
Class A Stock, Units or cash equivalent for which such Award was not then
otherwise exercisable by its terms, and, when used with respect to Restricted
Stock or Restricted Units, means that the Risk of Forfeiture otherwise
applicable to the Class A Stock or Units shall expire with respect to some or
all of the Class A Stock or Units then otherwise subject to the Risk of
Forfeiture.

2.2 Affiliate 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, “control”
means the possession, direct or indirect, of the power to direct or cause the
direction of management and policies of a Person, whether through ownership of
voting securities, by contract or otherwise.

2.3 Award means any grant or sale pursuant to the Plan of Options, Restricted
Units, Restricted Stock, Unit Grants, other Unit-Based Awards or LTIP Units.

2.4 Award Agreement means an agreement, instrument or other document between the
Company or MN Group, as the case may be, and the recipient of an Award, setting
forth the terms and conditions of the Award.

2.5 Beneficial Owner shall have the meaning set forth in Rule 13d-3 under the
Exchange Act.

2.6 Board means the Board of Directors of the Company.

2.7 Cause means, unless otherwise provided in an applicable Award Agreement, a
termination of employment or service, based on a finding by the Committee, that
the Participant engaged in conduct (a) which involves fraud, moral turpitude,
willful misconduct, bad faith or commission of a crime that is classified as a
felony under New York law and in the reasonable opinion of the Board is
injurious to the Company, MN Group or their Affiliates, or (b) that constitutes
grounds for termination for cause under the Participant’s employment, consulting
or service agreement with the Company, MN Group or their Affiliates, to the
extent applicable, or under any policies in effect applicable to the Participant
and relating to his or her employment by, or association with, the Company, MN
Group or their Affiliates.

2.8 Change in Control shall have the meaning set forth in Section 8.2 hereof.

2.9 Class A Stock means Class A common stock, par value $0.01 per share, of the
Company.

2.10 Class A Unit means a “Class A Unit” in MN Group, as described in the
Operating Agreement.

2.11 Class B Unit means a “Class B Unit” in MN Group, as described in the
Operating Agreement.

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2.12 Code means the Internal Revenue Code of 1986, as amended from time to time,
or any successor statute thereto, and any regulations issued from time to time
thereunder. To the extent that reference is made to any particular section of
the Code, such reference shall be, where the context so admits, to any
corresponding provisions of any succeeding law.

2.13 Committee means any committee of the Board that is delegated responsibility
for the administration of the Plan, as provided in Section 4; provided, that
such committee shall be comprised solely of directors of the Company who are
(a) “non-employee directors” under Rule 16b-3 of the Exchange Act, (b) “outside
directors” under Code Section 162(m) and (c) “independent directors” pursuant to
New York Stock Exchange requirements. For any period during which no such
committee is in existence, “Committee” shall mean the Managing Member and all
authority and responsibility assigned to the Committee under the Plan shall be
exercised, if at all, by the Managing Member.

2.14 Company means Manning & Napier, Inc., a corporation organized under the
laws of the State of Delaware.

2.15 Covered Employee shall have the meaning set forth in Section 162(m)(3) of
the Code.

2.16 Effective Date means the date this Plan is adopted by the Board, on behalf
of the Company, and the Managing Member, on behalf of MN Group.

2.17 Equity Units means either Class A Stock, Units or LTIP Units.

2.18 Exchange Act means the Securities Exchange Act of 1934, as amended from
time to time, and as now or hereafter construed, interpreted and applied by
regulations, rulings and cases.

2.19 Exercise Price means the price per share of Class A Stock or Unit, as
applicable, at which a holder of an Award granted hereunder may purchase the
Class A Stock or Units issuable upon exercise of such Award.

2.20 Fair Market Value of a share of Class A Stock or a Unit on any given date
means: (i) if the Class A Stock is listed for trading on the New York Stock
Exchange, the closing sale price per share of Class A Stock on the New York
Stock Exchange on that date (or, if no closing sale price is reported, the last
reported sale price), (ii) if the Class A Stock is not listed for trading on the
New York Stock Exchange, the closing sale price (or, if no closing sale price is
reported, the last reported sale price) as reported on that date in composite
transactions for the principal national securities exchange registered pursuant
to Section 6(g) of the Exchange Act on which the Class A Stock is listed,
(iii) if the Class A Stock is not so listed on a national securities exchange,
the last quoted bid price for the Class A Stock on that date in the
over-the-counter market as reported by Pink Sheets LLC or a similar
organization, or (iv) if the Class A Stock is not so quoted by Pink Sheets LLC
or a similar organization such value as the Committee, in its sole discretion,
shall determine in good faith. For the avoidance of doubt, the Fair Market Value
of a Unit shall at all times equal the Fair Market Value of a share of Class A
Stock.

2.21 Grant Date means the date as of which an Option is granted, as determined
under Section 6.1(a).

2.22 IPO means the initial public offering of Class A Stock, as contemplated in
the registration statement on Form S-1 of the Company (No. 333-175309).

2.23 ISO means any Option to acquire Class A Stock intended to be and designated
as an incentive stock option within the meaning of Section 422 of the Code.
Options to acquire Units may not be designated as ISOs.

2.24 LTIP Unit means a certain class or classes of membership interests in the
Company which, upon the occurrence of certain events, may convert into Units.

2.25 Managing Member means the Company, as the Managing Member of MN Group.

2.26 MN Group means Manning & Napier Group, LLC, a limited liability company
organized under the laws of the State of Delaware.

2.27 NQSO means any Option that is designated as a nonqualified stock option.

 

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2.28 Operating Agreement means the Amended and Restated Limited Liability
Company Agreement of MN Group, effective as of October 1, 2011, as in effect
from time to time.

2.29 Option means an option to purchase Class A Stock, in the form of an ISO or
a NQSO, or an option to purchase Units.

2.30 Optionee means a Participant to whom an Option shall have been granted
under the Plan.

2.31 Participant means any holder of an outstanding Award under the Plan.

2.32 Performance Goals means performance goals based on one or more of the
following criteria: (i) earnings including operating income, economic income,
economic net income, earnings before or after taxes, earnings before or after
interest, depreciation, amortization, or extraordinary or special items or book
value per share (which may exclude nonrecurring items); (ii) pre-tax income or
after-tax income; (iii) earnings per common share (basic or diluted);
(iv) operating profit; (v) revenue, revenue growth or rate of revenue growth;
(vi) return on assets (gross or net), return on investment, return on capital,
or return on equity; (vii) returns on sales or revenues; (viii) operating
expenses; (ix) stock price appreciation; (x) cash flow, free cash flow, cash
flow return on investment (discounted or otherwise), net cash provided by
operations, or cash flow in excess of cost of capital; (xi) implementation or
completion of critical projects or processes; (xii) economic value created;
(xiii) cumulative earnings per share growth; (xiv) operating margin or profit
margin; (xv) common stock price or total stockholder return; (xvi) cost targets,
reductions and savings, productivity and efficiencies; (xvii) strategic business
criteria, consisting of one or more objectives based on meeting specified market
penetration, geographic business expansion, customer satisfaction, employee
satisfaction, human resources management, supervision of litigation, information
technology, and goals relating to acquisitions, divestitures, joint ventures and
similar transactions, and budget comparisons; (xviii) personal professional
objectives, including any of the foregoing performance goals, the implementation
of policies and plans, the negotiation of transactions, the development of
long-term business goals, formation of joint ventures, research or development
collaborations, and the completion of other corporate transactions; and
(xix) any combination of any of the foregoing.

Where applicable, the Performance Goals may be expressed in terms of attaining a
specified level of the particular criteria or the attainment of a percentage
increase or decrease in the particular criteria, and may be applied to one or
more of the Company, MN Group or an Affiliate, or a division or strategic
business unit of the Company or MN Group, or may be applied to the performance
of the Company relative to a market index, a group of other companies or a
combination thereof, or other pre-established target or designated comparison
group, all as determined by the Committee. The Performance Goals may include a
threshold level of performance below which no payment will be made (or no
vesting will occur), levels of performance at which specified payments will be
made (or specified vesting will occur), and a maximum level of performance above
which no additional payment will be made (or at which full vesting will occur).
Each of the foregoing Performance Goals shall, as selected by the Committee, be
determined in accordance with generally accepted accounting principles or
non-GAAP financial measures, and shall be subject to certification by the
Committee; provided that, to the extent an Award is intended to satisfy the
performance-based compensation exception to the limits of Section 162(m) of the
Code and then to the extent consistent with such exception, the Committee shall
have the authority to make equitable adjustments to the Performance Goals in
recognition of unusual or non-recurring events affecting the Company MN Group or
any Affiliate or the financial statements of the Company, MN Group or any
Affiliate, in response to changes in applicable laws or regulations, or to
account for items of gain, loss or expense determined to be extraordinary or
unusual in nature or infrequent in occurrence or related to the disposal of a
segment of a business or related to a change in accounting principles.

2.33 Person means any individual, corporation, firm, partnership, joint venture,
limited liability company, estate, trust, business association, organization, or
other entity.

2.34 Plan means this Manning & Napier, Inc. 2011 Equity Compensation Plan, as
amended from time to time, and including any attachments or addenda hereto.

2.35 Restricted Stock means an Award of shares of Class A Stock to a Participant
under Section 6.2 that may be subject to certain restrictions and to a Risk of
Forfeiture.

2.36 Restricted Units means an Award of Units to a Participant under Section 6.2
that may be subject to certain restrictions and to a Risk of Forfeiture.

 

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2.37 Restriction Period means the period of time, established by the Committee
in connection with an Award of Restricted Stock or Restricted Units, during
which such Restricted Stock or Restricted Units are subject to a Risk of
Forfeiture described in the applicable Award Agreement.

2.38 Risk of Forfeiture means a limitation on the right of the Participant to
retain Restricted Stock or Restricted Units, including a right in the Company or
MN Group, as the case may be, to reacquire the Restricted Stock or Restricted
Units at less than their then Fair Market Value or for no consideration, arising
because of the occurrence or non-occurrence of specified events or conditions.

2.39 Securities Act means the Securities Act of 1933, as amended from time to
time.

2.40 Stock Appreciation Right or SAR means the right pursuant to an Award
granted under Section 6.4 below to receive an amount equal to the excess, if
any, of (i) the aggregate Fair Market Value, as of the date of such SAR or
portion thereof is surrendered, of the Class A Stock or Unit covered by such
right or such portion thereof, over (ii) the aggregate Exercise Price of such
right or portion thereof.

2.41 Stock-Based Award means an Award granted to a Participant pursuant to
Section 6.4 hereof, that may be denominated or payable in, valued in whole or in
part by reference to, or otherwise based on, or related to, Class A Stock
including but not limited to performance units and Stock Appreciation Rights,
and which may be subject to the attainment of Performance Goals or a period of
continued employment or other terms and conditions as permitted under the Plan.

2.42 Unit means a Class A Unit or a Class B Unit.

2.43 Unit Grant means a grant of Units not subject to restrictions or other
forfeiture conditions.

2.44 Unit-Based Award means an Award granted pursuant to Section 6.4 of the
Plan, that may be denominated or payable in, valued in whole or in part by
reference to, or otherwise based on, or related to, Units including but not
limited to performance units and Stock Appreciation Rights, and which may be
subject to the attainment of Performance Goals or a period of continued
employment or other terms and conditions as permitted under the Plan.

The definition of terms herein shall apply equally to the singular and plural
forms of the terms defined. Whenever the context may require, any pronoun shall
include the corresponding masculine, feminine and neuter forms. The words
“include”, “includes” and “including” shall be deemed to be followed by the
phrase “without limitation”. Unless the context requires otherwise (i) any
definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document
as from time to time amended, restated, supplemented or otherwise modified
(subject to any restrictions on such amendments, restatements, supplements or
modifications set forth therein or herein), (ii) references to any law,
constitution, statute, treaty, regulation, rule or ordinance, including any
section or other part thereof shall refer to it as amended from time to time and
shall include any successor law, (iii) the words “herein”, “hereof” and
“hereunder”, and words of similar import, shall be construed to refer to this
Plan in its entirety and not to any particular provision hereof and (iv) all
references herein to Sections shall be construed to refer to Sections to this
Plan.

3. Term of the Plan

Unless the Plan shall have been earlier terminated by the Company, Awards may be
granted under this Plan at any time in the period commencing on the date of
approval of the Plan by the Company and ending immediately prior to the tenth
anniversary of such date. Awards granted pursuant to the Plan within that period
shall not expire solely by reason of the termination of the Plan.

4. Administration

The Plan shall be administered by the Committee; provided, however, that the
Committee may delegate to one or more “executive officers” (as defined under
applicable rules promulgated under the Exchange Act) the authority to grant
Awards hereunder to employees who are not executive officers, and to consultants
and advisers, in accordance with such guidelines as the Committee shall set
forth at any time or from time to time. Subject to the provisions of the Plan,
the Committee shall have complete authority, in its discretion, to make or to
select the manner of making all determinations with respect to each Award to be
granted by the Company or MN Group under the Plan including the director,
employee, adviser or consultant to receive the Award and the form of Award. In

 

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making such determinations, the Committee may take into account the nature of
the services rendered by such directors, employees, advisers and consultants,
their present and potential contributions to the success of the Company and/or
MN Group, and such other factors as the Committee in its discretion shall deem
relevant. Subject to the provisions of the Plan, the Committee shall also have
complete authority to interpret the Plan, to prescribe, amend and rescind rules
and regulations relating to it, to determine the terms and provisions of the
respective Award Agreements (which need not be identical), and to make all other
determinations necessary or advisable for the administration of the Plan. The
Committee’s determinations made in good faith on matters referred to in the Plan
shall be final, binding and conclusive on all persons having or claiming any
interest under the Plan or an Award made pursuant hereto.

5. Authorization of Grants

5.1 Eligibility. The Committee may grant from time to time and at any time prior
to the termination of the Plan one or more Awards, either alone or in
combination with any other Awards, to any service provider to the Company, MN
Group or any of their Affiliates, including directors, officers, employees,
advisers and consultants of the Company, MN Group and/or their respective
Affiliates.

5.2 General Terms of Awards. Each grant of an Award shall be subject to all
applicable terms and conditions of the Plan (including but not limited to any
specific terms and conditions applicable to that type of Award set out in
Section 6 or in the Award Agreement), and such other terms and conditions, not
inconsistent with the terms of the Plan, as the Committee may prescribe.
Restricted Units and Units Grants under the Plan shall at all times be subject
to the terms of the Operating Agreement.

5.3 Non-Transferability of Awards. Awards shall not be transferable, and no
Awards or interest therein may be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution, and all of a Participant’s rights in any Award may be
exercised during the life of the Participant only by the Participant or the
Participant’s legal representative. Notwithstanding the foregoing, Unit Grants
and, following lapse of the Restriction Period, Restricted Units may be
transferred in accordance with the provisions of the Operating Agreement.

5.4 Conditions to Receipt of Awards.

(a) Unless otherwise waived by the Committee, no prospective Participant shall
have any rights with respect to an Award unless and until such Participant has
executed an Award Agreement evidencing the Award, delivered a fully executed
copy thereof to the Company, and otherwise complied with the applicable terms
and conditions of such Award.

(b) Notwithstanding anything herein to the contrary, no Award of Options,
Restricted Units, Unit Grants, other Unit-Based Awards or LTIP Units and no
issuance of Class A Stock or Units upon exercise of an Option or the settlement
of any Stock-Based or Unit-Based Award, may be made to an individual who has
committed any act which could serve as a basis for (i) denial, suspension or
revocation of the registration of any investment adviser, including Affiliates
of the Company or MN Group, under Section 203(e) of the Investment Advisers Act
of 1940, as amended, or Rule 206(4)-4(b) thereunder, or for disqualification of
any investment adviser, including Affiliates of the Company or MN Group, as an
investment adviser to a registered investment company pursuant to Sections 9(a)
or 9(b) of the Investment Company Act of 1940, as amended, (ii) precluding the
Company, MN Group or their respective Affiliates from acting as a fiduciary by
operation of Section 411 of the Employee Retirement Income Security Act of 1974,
as amended, or (iii) precluding the Company, MN Group or their respective
Affiliates from qualifying as a “qualified professional asset manager” within
the meaning of Department of Labor Prohibited Transaction Exemption 84-14.

(c) Each Award of Restricted Units, Unit Grants, other Unit-Based Awards or LTIP
Units and each issuance of Units to the recipient of an Award of Options
exercisable into Units or upon settlement of a Unit-Based Award, shall be
conditioned upon the recipient’s execution of the Operating Agreement or an
agreement of accession thereto.

5.5 Equity Subject to Plan. The maximum number of Equity Units reserved for the
grant or settlement of Awards (in the form of Class A Stock or Units) under the
Plan shall be a number equal to 13,142,813 and shall be subject to adjustment as
provided herein. If any shares of Class A Stock or Units subject to an Award are
forfeited, canceled, exchanged or surrendered or if an Award otherwise
terminates or expires without a distribution of Equity Units to the Participant,
the Class A Stock or Units with respect to such Award shall, to the extent of
any such forfeiture, cancellation, exchange, surrender, termination or
expiration, again be available for Awards under the Plan. Notwithstanding the
foregoing, Equity Units that are exchanged by a Participant or withheld by the
Company or MN Group, in either case, as full or partial payment in connection
with any Award under the Plan, as well as any Equity

 

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Units exchanged by a Participant or withheld by the Company or MN Group to
satisfy the tax withholding obligations related to any Award under the Plan,
shall not be available for subsequent Awards under the Plan.

5.6 Covered Employees. From and after the date that the grant of an Award to a
Covered Employee is subject to Section 162(m) of the Code, the aggregate Awards
granted during any fiscal year to any single individual who is likely to be a
Covered Employee shall not exceed 2,628,563 Equity Units. Determinations made in
respect of the limitation set forth in the preceding sentence shall be made in a
manner consistent with Section 162(m) of the Code.

5.7 Authorized Shares. Shares of Class A Stock issued under the Plan may, in
whole or in part, be authorized but unissued shares of Class A Stock or shares
that have been or may be reacquired by the Company in the open market, in
private transactions or otherwise.

6. Specific Terms of Awards

6.1 Options.

(a) Date of Grant. The granting of an Option shall take place at the time
specified in the Award Agreement.

(b) Exercise Price. The price at which a share of Class A Stock or a Unit may be
acquired under each Option shall be no less than 100% of the Fair Market Value
of such Class A Stock or Unit on the Grant Date.

(c) Option Period. The exercise period with respect to each Option shall be
determined in the sole discretion of the Committee and specified in each Award
Agreement; provided, however, that no Option may be exercised on or after the
tenth anniversary of the Grant Date.

(d) Exercisability. An Option may be immediately exercisable or become
exercisable in such installments, cumulative or non-cumulative, as the Committee
may determine and as set forth in each Award Agreement. In the case of an Option
not otherwise immediately exercisable in full, the Committee may Accelerate such
Option in whole or in part at any time.

(e) ISOs. No ISO shall be granted to any employee of the Company or MN Group, if
such employee owns, or is deemed to own, immediately prior to the grant of the
ISO, stock representing more than 10% of the total combined voting power of the
Company, MN Group or their Affiliates, or more than 10% of the value of all
classes of stock of the Company, MN Group or their Affiliates, unless the
purchase price for the stock under such ISO shall be at least 110% of its Fair
Market Value at the time such ISO is granted and the ISO, by its terms, shall
not be exercisable more than five years from the date it is granted. In
determining the stock ownership under this paragraph, the provisions of
Section 424(d) of the Code shall be controlling.

(f) Termination of Association with the Company — Generally. Unless the
Committee shall provide otherwise for any Award with respect to any Option as
set forth in the Award Agreement for such Option, if the Optionee’s employment
or other association with the Company ends for any reason, any outstanding
Option of the Optionee shall cease to be exercisable in any respect and shall
terminate not later than 90 days following that event and, for the period it
remains exercisable following that event, shall be exercisable only to the
extent exercisable at the date of that event (and to the extent not then
exercisable, shall terminate as of the date of such event). Military or sick
leave or other bona fide leave shall not be deemed a termination of employment
or other association, provided that it does not exceed the longer of ninety
(90) days or the period during which the absent Optionee’s reemployment rights,
if any, are guaranteed by statute or by contract.

(g) Method of Exercise. An Option may be exercised by the Optionee giving
written notice, in the manner provided in Section 14 or as otherwise set forth
in an Award Agreement, specifying the number of shares of Class A Stock or Units
with respect to which the Option is then being exercised. Where the exercise of
an Option is to be accompanied by payment, the Committee may determine the
required or permitted forms of payment, subject to the following: (a) all
payments will be by cash or check acceptable to the Committee; or (b) if so
permitted by the Committee, (i) through the delivery of Class A Stock or Units
that have a Fair Market Value equal to the exercise price, except where payment
by delivery of Class A Stock or Units would adversely affect the Company’s
results of operations under U.S. generally accepted accounting principles or
where payment by delivery of Class A Stock or Units outstanding for less than
six months would require application of securities laws relating to profit
realized on such Class A Stock or Units, (ii) by other means acceptable to the
Committee, or (iii) by means of withholding of Class A Stock or Units, with an
aggregate Fair Market Value equal to (A) the aggregate exercise price and
(B) unless the Company or MN Group is precluded

 

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or restricted from doing so under debt covenants, minimum statutory withholding
taxes with respect to such exercise, or (iv) by any combination of the foregoing
permissible forms of payment. The delivery of Class A Stock or Units in payment
of the exercise price under clause (g)(i) above may be accomplished either by
actual delivery or by constructive delivery through attestation of ownership,
subject to such rules as the Committee may prescribe.

(h) No Certificates. Unless otherwise required under the Operating Agreement,
Units are not represented by certificates. The “issuance” of Units pursuant to
the exercise of an Option granted under the Plan shall not require the creation
or delivery of a certificate or other evidence of ownership, other than that
provided by the applicable Award Agreement, but instead only the Company’s
recognition of the Optionee on its books and records as the beneficial holder of
such Units, unless otherwise required under the Operating Agreement.

(i) Rights Pending Exercise. No Participant holding an Option shall be deemed
for any purpose to be (i) a stockholder of the Company with respect to any
shares of Class A Stock, or (ii) a member of MN Group with respect to any of the
Units, in either case issuable pursuant to his or her Option, except to the
extent that the Option shall have been exercised with respect thereto.

6.2 Restricted Stock and Restricted Units.

(a) Purchase Price Class A Stock, Restricted Stock, Units or Restricted Units
may be issued under the Plan for such consideration, in cash, other property or
services, or any combination thereof, as is determined by the Committee.

(b) No Certificates. Units are not represented by certificates. The “issuance”
of Units or Restricted Units under the Plan shall not require the creation or
delivery of a certificate or other evidence of ownership, other than that
provided by the applicable Award Agreement, but instead only the MN Group’s
recognition of the Participant on its books and records as the beneficial holder
of such Units or Restricted Units.

(c) Restrictions and Restriction Period. During the Restriction Period
applicable to Restricted Stock or Restricted Units, such Restricted Stock or
Restricted Units shall be subject to limitations on transferability and a Risk
of Forfeiture arising on the basis of such conditions related to the performance
of services, Company and/or MN Group performance or otherwise as the Committee
may determine and provide for in the applicable Award Agreement. Any such Risk
of Forfeiture may be waived or terminated, or the Restriction Period shortened,
at any time by the Committee on such basis as it deems appropriate. Certificates
for shares issued pursuant to Restricted Stock Awards shall bear an appropriate
legend referring to such restrictions, and any attempt to dispose of any such
shares in contravention of such restrictions shall be null and void and without
effect. Such certificates may, if so determined by the Committee, be held in
escrow by an escrow agent (which may be the Company or MN Group) appointed by
the Committee, to be held for the benefit of the Participant for such period in
the discretion of the Committee until the applicable Restriction Period lapses.

(d) Rights Pending Lapse of Risk of Forfeiture or Forfeiture of Award. Except as
otherwise provided in the Plan or the applicable Award Agreement, at all times
prior to lapse of any Risk of Forfeiture applicable to, or forfeiture of, an
Award of Restricted Stock or Restricted Units, the Participant shall have all of
the rights of a holder of Class A Stock or Units, as the case may be, including,
but not limited to, the right to vote and the right to receive any dividends or
distributions with respect to the Restricted Stock or Restricted Units, as
applicable.

(e) Termination of Association with the Company. Unless the Committee shall
provide otherwise in the applicable Award Agreement for any Award of Restricted
Stock or Restricted Units, upon termination of a Participant’s employment or
other association with the Company, MN Group and their Affiliates for any reason
during the Restriction Period, all Restricted Stock or Restricted Units still
subject to Risk of Forfeiture shall be forfeited or otherwise subject to return
to or repurchase by the Company or MN Group on the terms specified in the Award
Agreement; provided, however, that military or sick leave or other bona fide
leave shall not be deemed a termination of employment or other association if it
does not exceed the longer of ninety (90) days or the period during which the
absent Participant’s reemployment rights, if any, are guaranteed by statute or
by contract.

6.3 Class A Stock and Unit Grants. Class A Stock and Unit Grants may be awarded
solely in recognition of significant contributions to the success of the
Company, MN Group or their Affiliates in lieu of compensation otherwise already
due and in such other limited circumstances as the Committee deems appropriate.
Class A Stock and Unit Grants shall be made without forfeiture conditions of any
kind.

 

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6.4 Stock-Based Awards. The Committee, in its sole discretion, may grant Awards
of phantom shares of Class A Stock, SARs and other Awards that are valued in
whole or in part by reference to, or are otherwise based on the Fair Market
Value of a share of Class A Stock. Such Stock-Based Awards shall be in such
form, and dependent on such conditions, as the Committee shall determine,
including, without limitation, the right to receive shares of Class A Stock (or
the equivalent cash value of such Class A Stock) upon the completion of a
specified period of service, the occurrence of an event and/or the attainment of
Performance Goals. Stock-Based Awards may be granted alone or in addition to any
other Awards granted under the Plan. Subject to the provisions of the Plan, the
Committee shall determine: (a) the number of shares of Class A Stock to be
awarded under (or otherwise related to) such Stock-Based Awards; (b) whether
such Stock-Based Awards shall be settled in cash, shares of Class A Stock or a
combination of cash and Class A Stock; and (c) all other terms and conditions of
such Stock-Based Awards (including, without limitation, the vesting provisions
thereof).

6.5 Unit-Based Awards. The Committee, in its sole discretion, may grant Awards
of phantom Units, SARs and other Awards that are valued in whole or in part by
reference to, or are otherwise based on the Fair Market Value of a Unit. Such
Unit-Based Awards shall be in such form, and dependent on such conditions, as
the Committee shall determine, including, without limitation, the right to
receive one or more Units (or the equivalent cash value of such Units) upon the
completion of a specified period of service, the occurrence of an event and/or
the attainment of Performance Goals. Unit-Based Awards may be granted alone or
in addition to any other Awards granted under the Plan. Subject to the
provisions of the Plan, the Committee shall determine: (a) the number of Units
to be awarded under (or otherwise related to) such Unit-Based Awards;
(b) whether such Unit-Based Awards shall be settled in cash, Units or a
combination of cash and Units; and (c) all other terms and conditions of such
Unit-Based Awards (including, without limitation, the vesting provisions
thereof).

6.6 LTIP Units. LTIP Units may be granted as free-standing awards or in tandem
with other Awards under the Plan, and may be valued by reference to the Units,
and will be subject to such other conditions and restrictions as the Committee,
in its sole and absolute discretion, may determine, including, but not limited
to, continued employment or service, computation of financial metrics and/or
achievement of pre-established Performance Goals. LTIP Units, whether vested or
unvested, may entitle the participant to receive, currently or on a deferred or
contingent basis, distributions or distribution equivalent payments with respect
to the number of Units corresponding to the LTIP Unit or other distributions
from the Company and the Committee may provide in the applicable Award Agreement
that such amounts (if any) shall be deemed to have been reinvested in additional
Units or LTIP Units. The LTIP Units granted under the Plan will be subject to
such terms and conditions as may be determined by the Committee in its sole and
absolute discretion, including, but not limited to the conversion ratio, if any,
pursuant to which LTIP Units may be exchanged for Units in accordance with the
terms of the Operating Agreement. LTIP Units may be structured as “profits
interests,” “capital interests” or other types of interests for federal income
tax purposes.

6.7 Awards to Participants Outside the United States. The Committee may modify
the terms of any Award under the Plan granted to a Participant who is, at the
time of grant or during the term of the Award, resident or primarily employed
outside of the United States in any manner deemed by the Committee to be
necessary or appropriate in order that the Award shall conform to laws,
regulations, and customs of the country in which the Participant is then
resident or primarily employed, or so that the value and other benefits of the
Award to the Participant, as affected by foreign tax laws and other restrictions
applicable as a result of the Participant’s residence or employment abroad,
shall be comparable to the value of such an Award to a Participant who is
resident or primarily employed in the United States. The Committee may establish
supplements to, or amendments, restatements, or alternative versions of the Plan
for the purpose of granting and administrating any such modified Award, none of
which shall require prior approval of the stockholders of the Company except for
stockholder approval as may be necessary for the Plan or Award to comply with
applicable law.

7. Adjustment Provisions

7.1 Adjustment for Company Actions. If subsequent to the adoption of the Plan by
the Company and MN Group the outstanding Class A Stock or Units are increased,
decreased, or exchanged for a different number or kind of stock, units or other
securities, or if additional shares, units or new or different shares, units or
other securities are distributed with respect to Class A stock or Units through
merger, consolidation, sale of all or substantially all the property of the
Company or MN Group, reorganization, recapitalization, reclassification,
dividend, stock or unit split, reverse stock or unit split, or other similar
distribution with respect to such Class A Stock or Units, the Committee shall
make an adjustment, to the extent appropriate and proportionate, in (i) the
numbers and kinds of Class A Stock, Units or other securities subject to the
then outstanding Awards, and (ii) the exercise price for each Class A Stock,
Unit or other securities subject to then outstanding Options (without change in
the aggregate purchase price as to which such Options remain exercisable).

 

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7.2 Related Matters. Any adjustment in Awards made pursuant to this Section 7
shall be determined and made, if at all, by the Committee and shall include any
correlative modification of terms, including of Exercise Prices, rates of
vesting or exercisability, Risks of Forfeiture and applicable repurchase prices
for Restricted Stock, Restricted Units, LTIP Units, Stock-Based Awards and
Unit-Based Awards, which the Committee may deem necessary or appropriate so as
to ensure the rights of the Participants in their respective Awards are not
substantially diminished nor enlarged as a result of the adjustment and Company
action other than as expressly contemplated in this Section 7. No fraction of a
shares of Class A Stock or Unit shall be issued or purchasable or deliverable
upon exercise, but in the event any adjustment hereunder of the number of shares
of Class A Stock or Units covered by an Award shall cause such number to include
a fraction, such number of shares of Class A Stock or Units shall be adjusted to
the nearest smaller whole number of shares of Class A Stock or Units.

8. Change in Control Provisions

8.1 Unless otherwise determined by the Committee or evidenced in an applicable
Award Agreement or employment or other agreement, in the event of a Change in
Control, the Committee shall have the discretion, exercisable either in advance
of such Change in Control or at the time thereof, to provide for one or more of
the following:

(a) the continuation of outstanding Awards after the Change in Control without
change;

(b) the cash-out of outstanding Options as of the time of the transaction as
part of the transaction for an amount equal to the difference between the price
that would have been paid for the shares of Class A Stock or Units subject to
such outstanding Options if such Options were exercised upon the closing of such
transaction and the exercise price of such outstanding Options; provided that if
the exercise price of the Options exceeds the price that would have been paid
for the shares of Class A Stock or Units subject to the outstanding Options if
such Options were exercised upon the closing of the transaction, then such
Options may be cancelled without making a payment to the Optionees;

(c) a requirement that the buyer in the transaction assume outstanding Awards;

(d) a requirement that the buyer in the transaction substitute outstanding
Options with comparable options to purchase the equity interests of the buyer or
its parent and/or substitute outstanding Restricted Stock, Restricted Units,
LTIP Units, Stock-Based Awards, and/or Unit-Based Awards with comparable
restricted stock or units of the buyer or its parent; and

(e) the Acceleration of outstanding Options, Restricted Stock, Restricted Units,
Stock-Based Awards, Unit-Based Awards and LTIP Units.

Notwithstanding any other provision of the Plan, in the event of a Change in
Control in which the consideration paid to the holders of shares of Class A
Stock and Units is solely cash, the Committee may, in its discretion, provide
that each Award shall, upon the occurrence of a Change in Control, be canceled
in exchange for a payment, in cash or Class A Stock, in an amount equal to
(i) the excess of the consideration paid per share of Class A Stock and Units in
the Change in Control over the exercise or purchase price (if any) per share of
Class A Stock or Unit subject to the Award multiplied by (ii) the number of
shares of Class A Stock or Units granted under the Award.

8.2 A “Change in Control” shall be deemed to have occurred if the event set
forth in any one of the following paragraphs shall have occurred:

(a) any Person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities beneficially owned by
such Person any securities acquired directly from the Company or its Affiliates)
representing 50% or more of the combined voting power of the Company’s then
outstanding securities, excluding any Person who becomes such a Beneficial Owner
in connection with a transaction described in clause (I) of paragraph (c) below;

(b) during any period of twelve (12) month period, individuals who at the
beginning of such period constitute the Board, and any new director (other than
a director whose initial assumption of office is in connection with an actual or
threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) whose
election by the Board or nomination for election by the Company’s shareholders
was approved by a majority vote of the directors then still in office who either
were directors at the beginning of the period or whose election or nomination
for election was previously approved, cease for any reason to constitute at
least a majority of the Board;

 

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(c) there is consummated a merger or consolidation of the Company or MN Group
with any other corporation or other entity, other than (I) a merger or
consolidation which results in (A) the voting securities of the Company
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof), in combination with
the ownership of any trustee or other fiduciary holding securities under an
employee benefit plan of the Company or MN Group, at least 50% of the combined
voting power of the securities of the Company or such surviving entity or any
parent thereof outstanding immediately after such merger or consolidation and
(B) the individuals who comprise the Board immediately prior thereto
constituting immediately thereafter at least a majority of the board of
directors of the Company, the entity surviving such merger or consolidation or,
if the Company or the entity surviving such merger is then a subsidiary, the
ultimate parent thereof, or (II) a merger or consolidation effected to implement
a recapitalization of the Company or MN Group (or similar transaction) in which
no Person is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company (not including in the securities Beneficially Owned by
such Person any securities acquired directly from the Company or its Affiliates)
representing 50% or more of the combined voting power of the Company’s then
outstanding securities;

(d) the stockholders of the Company approve a plan of complete liquidation or
dissolution of the Company or MN Group or there is consummated an agreement for
the sale or disposition by the Company or MN Group of all or substantially all
of the assets of the Company or MN Group, as the case may be (it being
conclusively presumed that any sale or disposition is a sale or disposition by
the Company of all or substantially all of its assets if the consummation of the
sale or disposition is contingent upon approval by the Company’s stockholders
unless the Board expressly determines in writing that such approval is required
solely by reason of any relationship between the Company and any other Person or
an Affiliate of the Company and any other Person), other than a sale or
disposition by the Company of all or substantially all of the Company’s assets
to an entity (i) at least 50% of the combined voting power of the voting
securities of which are owned by stockholders of the Company in substantially
the same proportions as their ownership of the Company immediately prior to such
sale or disposition and (ii) the majority of whose board of directors
immediately following such sale or disposition consists of individuals who
comprise the Board immediately prior thereto; or

(e) the Company ceases to be the Managing Member of MN Group.

8.3 Notwithstanding Section 8.2 to the contrary, a “Change in Control” shall not
be deemed to have occurred by virtue of (a) the consummation of any transaction
or series of integrated transactions immediately following which the record
holders of the capital stock of the Company immediately prior to such
transaction or series of transactions continue to have substantially the same
proportionate ownership in an entity which owns all or substantially all of the
assets of the Company immediately following such transaction or series of
transactions, or (b) the loss of voting control of the Company by William
Manning pursuant to the terms of the Company’s charter.

9. Settlement of Awards

9.1 Violation of Law. Notwithstanding any other provision of the Plan or the
relevant Award Agreement, if, at any time, in the reasonable opinion of the
Committee, the issuance of Class A Stock, Units or LTIP Units covered by an
Award may constitute a violation of law, then the Company and/or MN Group, as
the case may be, may delay such issuance and the delivery of such Class A Stock,
Units or LTIP Units, as applicable, until approval shall have been obtained from
such governmental agencies as may be required under any applicable law, rule, or
regulation, and the Company and MN Group shall take all reasonable efforts to
obtain such approval.

9.2 Unfunded Status of Awards. The Plan is intended to constitute an “unfunded”
plan for incentive and deferred compensation. With respect to any payments not
yet made to a Participant pursuant to an Award, nothing contained in the Plan or
any Award shall give any such Participant any rights that are greater than those
of a general creditor of the Company.

9.3 No Fractional Shares. No fractional shares of Class A Stock shall be issued
or delivered pursuant to the Plan or any Award. The Committee shall determine
whether cash, other Awards, or other property shall be issued or paid in lieu of
such fractional shares or whether such fractional shares or any rights thereto
shall be forfeited or otherwise eliminated.

9.4 Investment Representations. Neither the Company nor MN Group shall be under
any obligation to issue Class A Stock, Units or LTIP Units covered by any Award
unless the intended recipient has made such written representations to the
Company or MN Group (upon which the Company or MN Group believe it may
reasonably rely) as the Company or MN Group, as the case may be, may deem
necessary or appropriate for purposes of confirming that the issuance of such
Class A Stock, Units or LTIP Units, as applicable, will be exempt from the
registration requirements of the Securities Act and any applicable state
securities laws and otherwise in compliance with all applicable laws, rules and
regulations, including but not limited to that the Participant is acquiring the

 

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Class A Stock, Units or LTIP Units, as applicable, for his or her own account
for the purpose of investment and not with a view to, or for sale in connection
with, the distribution of any such Class A Stock, Units or LTIP Units.

9.5 Registration. In the event that the disposition of Class A Stock or Units
acquired pursuant to the Plan is not covered by a then current registration
statement under the Securities Act, and is not otherwise exempt from such
registration, such Class A Stock or Units shall be restricted against transfer
to the extent required by the Securities Act or regulations thereunder, and the
Committee may require a Participant receiving Class A Stock or Units pursuant to
the Plan, as a condition precedent to receipt of such Class A Stock or Units, to
represent to the Company or MN Group in writing that the Class A Stock or Units
acquired by such Participant is acquired for investment only and not with a view
to distribution.

9.6 Tax Withholding. Whenever Class A Stock, Units or LTIP Units are issued or
to be issued pursuant to Awards granted under the Plan, the Company and MN Group
shall (i) have the right to require the recipient to remit to the Company or MN
Group in cash an amount sufficient to satisfy federal, state, local or other
withholding tax requirements if, when, and to the extent required by law
(whether so required to secure for the Company or MN Group an otherwise
available tax deduction or otherwise) coincident with the recipient’s exercise
of such Option or receipt of Class A Stock or Units; or (ii) to the extent
permitted by applicable law, withhold a number of Class A Stock, Units or LTIP
Units having an aggregate Fair Market Value equal to an amount sufficient to
satisfy any federal, state, local or other withholding requirements. The
obligations of the Company and MN Group under the Plan shall be conditional on
satisfaction of all such withholding obligations and the Company and MN Group
shall, to the extent permitted by law, have the right to deduct any such taxes
from any payment of any kind otherwise due to the recipient of an Award.

10. No Special Employment or Other Rights

Nothing contained in the Plan or in any Award Agreement shall confer upon any
recipient of an Award any right with respect to the continuation of his or her
employment or other association with the Company, MN Group or any of their
Affiliates, or interfere in any way with the right of the Company, MN Group or
any of their Affiliates, subject to the terms of any separate employment or
consulting agreement, any provision of law, or the Operating Agreement to the
contrary, at any time to terminate such employment or consulting agreement or to
increase or decrease, or otherwise adjust, the other terms and conditions of the
recipient’s employment or other association with the Company, MN Group or any
such Affiliate.

11. Nonexclusivity of the Plan

The adoption of the Plan by the Company and MN Group shall not be construed as
creating any limitations on the power of the Company or MN Group to adopt such
other incentive arrangements as it may deem desirable, including without
limitation, the granting of options and restricted units other than under the
Plan, and such arrangements may be either applicable generally or only in
specific cases.

12. Section 409A of the Code

This Plan is intended to comply and shall be administered in a manner that is
intended to comply with Section 409A of the Code and shall be construed and
interpreted in accordance with such intent. To the extent that an Award,
issuance and/or payment is subject to Section 409A of the Code, it shall be
awarded and/or issued or paid in a manner that will comply with Section 409A of
the Code, including proposed, temporary or final regulations or any other
guidance issued by the Secretary of the Treasury and the Internal Revenue
Service with respect thereto. Any provision of this Plan that would cause an
Award, issuance and/or payment to fail to satisfy Section 409A of the Code shall
have no force and effect until amended to comply with Code Section 409A (which
amendment may be retroactive to the extent permitted by applicable law).

13. Termination and Amendment of the Plan and Awards

The Company and MN Group may at any time terminate the Plan or make such
modifications of the Plan as it shall deem advisable. Unless the Company and MN
Group otherwise expressly provide, or may deem necessary or appropriate to
comply with applicable law, including without limitation the provisions of
Section 409A of the Code, no termination or amendment of the Plan may adversely
affect the rights of the recipient of an Award previously granted hereunder
without the consent of the recipient of such Award.

 

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The Plan shall take effect on the Effective Date but the Plan (and any grants of
Awards made prior to the stockholder approval mentioned herein) shall be subject
to the requisite approval of the stockholders of the Company, which approval
must occur within twelve (12) months of the date that the Plan is adopted by the
Board. In the event that the stockholders of the Company do not ratify the Plan
at a meeting of the stockholders at which such issue is considered and voted
upon, then upon such event the Plan and all rights hereunder shall immediately
terminate and no Participant (or any permitted transferee thereof) shall have
any remaining rights under the Plan or any Award Agreement entered into in
connection herewith. The Board may amend, alter or discontinue the Plan, but no
amendment, alteration, or discontinuation shall be made that would impair the
rights of a Participant under any Award theretofore granted without such
Participant’s consent, or that without the approval of the stockholders of the
Company would, except as provided in Section 7, increase the total number of
Awards reserved for the purpose of the Plan. In addition, approval by the
stockholders of the Company shall be required with respect to any amendment that
materially increases benefits provided under the Plan or materially alters the
eligibility provisions of the Plan or with respect to which stockholder approval
is required under the rules of any stock exchange on which the Class A Stock is
then listed. Unless sooner terminated by the Board, the Plan shall terminate on
the tenth anniversary of the Effective Date. The Board reserves the right to
terminate the Plan at any time. No Awards shall be granted under the Plan after
such termination date. The Plan shall remain in effect with respect to Awards
made under the Plan prior to the termination of the Plan until such Awards have
been satisfied or terminated in accordance with the terms of the Plan and the
applicable Award Agreements.

The Committee may amend the terms of any Award theretofore granted,
prospectively or retroactively, provided that the Award as amended is consistent
with the terms of the Plan, and further provided that, other than as the
Committee may deem necessary or appropriate to comply with applicable law,
including without limitation the provisions of Section 409A of the Code, no
amendment or modification of an outstanding Award may adversely affect the
rights of the recipient of such Award without his or her consent. An amendment
or modification to an Award that is necessary or appropriate to comply with
applicable law or that does not adversely affect the rights of the recipient of
such Award may be made without the consent of such recipient.

14. Notices and Other Communications

Any notice, demand, request or other communication hereunder to any party shall
be deemed to be sufficient if contained in a written instrument delivered in
person or duly sent by first class registered, certified or overnight mail,
postage prepaid, or by facsimile with a confirmation copy by regular, certified
or overnight mail, addressed or sent by facsimile, as the case may be, (i) if to
the recipient of an Award, at his or her residence address last filed with the
Company or MN Group, and (ii) if to the Company or MN Group, at their principal
place of business, addressed to the attention of the Managing Member, or to such
other address or facsimile number, as the case may be, as the addressee may have
designated by notice to the addressor. All such notices, requests, demands and
other communications shall be deemed to have been received: (x) in the case of
personal delivery, on the date of such delivery, (y) in the case of mailing,
when received by the addressee, and (z) in the case of facsimile transmission,
when confirmed by facsimile machine report.

15. Governing Law

The Plan and all Award Agreements and actions taken thereunder shall be
governed, interpreted and enforced in accordance with the laws of the State of
New York without regard to the conflict of laws principles thereof.

Adopted by resolution of the Managing Member of MN Group and the Board of
Directors of the Company as of November 17, 2011.

 

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