Document:

Exhibit 4.4

 

 

 

SAFE BULKERS, INC.,

 

- and -

 

POLYS HAJIOANNOU

 

 

 

SECOND AMENDED AND RESTATED

RESTRICTIVE COVENANT AGREEMENT

 

 

 

 

 

    	 

    	

    

THIS SECOND AMENDED AND RESTATED RESTRICTIVE
COVENANT AGREEMENT (this “Agreement”) is made on August 2, 2017, and amends and restates in its entirety that
certain Restrictive Covenant Agreement, dated May 29, 2008, as amended by that certain Amendment No. 1 to Restrictive Covenant
Agreement, dated February 25, 2014, and as further amended and restated by that certain Amended and Restated Restrictive Covenant
Agreement, dated May 29, 2015 (together, the “Original Agreement”),

 

BY AND BETWEEN:

 

1. SAFE BULKERS, INC.,
a Marshall Islands corporation (the “Company”); and

 

2. POLYS HAJIOANNOU,
in his individual capacity (“P. Hajioannou”).

 

WHEREAS:

 

1. Pursuant to Section
8.1 of the Original Agreement, the parties thereto may amend the Original Agreement by an instrument in writing;

 

2. Pursuant to the Second
Amended and Restated Restrictive Covenant Agreement by and between the Company and P. Hajioannou, Vorini Holdings, Inc., a Marshall
Islands corporation (“Vorini Holdings”), and Machairiotissa Holdings Inc., a Marshall Islands corporation (“Machairiotissa
Holdings” and, together with P. Hajioannou, Vorini Holdings and, together with any entity controlled by or under common
control with Machairiotissa Holdings, P. Hajioannou and/or Vorini Holdings, the “Hajioannou Entities”), dated
August 2, 2017 (the “Hajioannou Entities Restrictive Covenant Agreement”), the Hajioannou Entities: (i) are
prohibited from conducting certain activities that may compete with the business of the Company and (ii) granted the Company a
right of first offer to purchase the Hajioannou Entities’ relevant interest in each of Safety Management Overseas S.A., a
Panamanian corporation (the “SMO Manager”), and Safe Bulkers Management Limited, a Cypriot private limited company
(the “Safe Bulkers Manager,” together with the SMO Manager, the “Managers”), in the event
of a potential change of control of each such Manager, respectively; and

 

3. The Company wishes
to limit the activities of P. Hajioannou in his capacity as a director or employee of the Company, and any entity controlled by
P. Hajioannou (“P. Hajioannou Entity”), on the terms and conditions set out in this Agreement in order to prohibit
certain activities that may compete with the business of the Company.

 

NOW, THEREFORE, in consideration
of the terms and conditions set forth below and other good and valuable consideration (the receipt and sufficiency of which is
hereby acknowledged), the parties hereto agree as follows:

    	 

    	

    

ARTICLE I

 

INTERPRETATION

 

SECTION
1.1 In this Agreement, unless the context otherwise requires:

 

(a)
“Agreement” shall have the meaning set forth in the preamble.

 

(b)
“Applicable Vessels” shall have the meaning set forth in Section 3.4.

 

(c)
“Board of Directors” means the board of directors of the Company as the same may be constituted from
time to time.

 

(d)
“Break Up Cost” means the aggregate amount of any and all costs including any taxes, registration fees,
administrative expenses, severance costs, and other similar costs and expenses that would be required to transfer Drybulk Vessels
or any other portion of a Non-Drybulk Acquisition that owns or operates Drybulk Vessels to the Company separately from the other
assets of the Non-Drybulk Acquisition.

 

(e)
“Business Day” means a day (excluding Saturdays and Sundays) on which banks are open for business in
Athens, Greece; Cyprus; and New York, New York.

 

(f) “Company”
shall have the meaning set forth in the preamble.

 

(g)
“Company Group” means, at any time, the Company and its subsidiaries at such time and “member of
the Company Group” shall be construed accordingly.

 

(h)
“Competitive Activities” shall have the meaning set forth in Section 3.1.

 

(i)
“Drybulk Vessel” means any ocean-going vessel (including any Newbuild) that is intended to be used primarily
to transport non-liquid cargoes of commodities shipped in an unpackaged state.

 

(j)
“Drybulk Vessel Business” means any business involved in the ownership or operation of Drybulk Vessels.

 

(k)
“Effective Date” means May 28, 2008.

 

(l)
“Hajioannou Entities” shall have the meaning set forth in the recitals.

 

(m)
“Hajioannou Entities Restrictive Covenant Agreement” shall have the meaning set forth in the recitals.

 

(n)
“Independent Directors” means those members of the Board of Directors that qualify as independent directors
within the meaning of Rule 10A-3 promulgated under the U.S. Securities Exchange Act of 1934, as amended, and the listing criteria
of the New York Stock Exchange.

 

(o)
“Machairiotissa Holdings” shall have the meaning set forth in the recitals.

    	2

    	

    

(p)
“Management Agreements” means the Safe Bulkers Manager Management Agreement and the SMO Management Agreement.

 

(q)
“Managers” shall have the meaning set forth in the recitals.

 

(r) “Newbuild”
means a new vessel to be or which has just been constructed, or is under construction, which a member of the Company Group has
agreed to acquire pursuant to a shipbuilding contract, memorandum of agreement or otherwise.

 

(s)
“Non-Drybulk Acquisition” means an acquisition or investment that includes (i) both Drybulk Vessels and
vessels other than Drybulk Vessels and/or (ii) any business that owns or operates Drybulk Vessels and vessels other than Drybulk
Vessels.

 

(t)
“Permitted Acquisition” means an acquisition by P. Hajioannou of a Drybulk Vessel or an acquisition of
or investment in a Drybulk Vessel Business that (i) has been first offered to the Company and refused by the majority of the Independent
Directors and (ii) has been acquired or invested in by P. Hajioannou on terms and conditions as to price that are not more favorable,
and on such other terms and conditions that are not materially more favorable, to P. Hajioannou than those offered to the Company.

 

(u)
“P. Hajioannou” shall have the meaning set forth in the preamble.

 

(v)
“P. Hajioannou Entity” shall have the meaning set forth in the recitals, and “P. Hajioannou
Entities” shall have a corresponding meaning.

 

(w)
“Restricted Period” shall mean the period commencing on the Effective Date and ending one year following
the later of (i) the termination of P. Hajioannou’s service with the Company as a director and (ii) the termination of P.
Hajioannou’s service with the Company as an employee.

 

(x)
“Safe Bulkers Manager Management Agreement” means the Management Agreement between the Company and the
Safe Bulkers Manager, dated on or about the date of this Agreement.

 

(y) “Safe
Bulkers Manager” shall have the meaning set forth in the recitals.

 

(z)
“SMO Management Agreement” means the Amended and Restated Management Agreement between the Company and
the SMO Manager, dated on or about the date of this Agreement.

 

(aa)
“SMO Manager” shall have the meaning set forth in the recitals.

 

(bb)
“Vorini Holdings” shall have the meaning set forth in the recitals.

    	3

    	

    

SECTION 1.2
The headings of this Agreement are for ease of reference and do not limit or otherwise affect the meaning hereof.

 

SECTION
1.3 All the terms of this Agreement, whether or not so expressed, shall be binding upon the parties hereto and their respective
successors and assigns.

 

SECTION
1.4 Unless the context otherwise requires, words in the singular include the plural and vice versa.

 

ARTICLE II

 

ACKNOWLEDGEMENT

 

SECTION
2.1 P. Hajioannou acknowledges he has received and reviewed the Management Agreements.

 

SECTION
2.2 P. Hajioannou acknowledges and agrees that, pursuant to the terms of the Management Agreements, during the respective
terms of each of the Management Agreements, if a Drybulk Vessel owned by the Company and a Drybulk Vessel owned or operated, directly
or indirectly, by P. Hajioannou or any P. Hajioannou Entity (other than through the Company) are both available and meet the criteria
for a charter being fixed by either of the Managers, the Company’s Drybulk Vessel shall receive such charter. For the avoidance
of doubt, this Section 2.2 shall apply only to Drybulk Vessels owned or operated, directly or indirectly, by P. Hajioannou
or any P. Hajioannou Entity that is under the commercial management of either of the Managers, and shall not apply to any Drybulk
Vessel owned or operated, directly or indirectly, by P. Hajioannou or any P. Hajioannou Entity that is not under the commercial
management of either of the Managers.

 

ARTICLE III

 

NON-COMPETITION

 

SECTION
3.1 During the Restricted Period, P. Hajioannou shall and procures that the P. Hajioannou Entities shall, subject to Section
3.2 hereof, not directly or indirectly, engage in (a) the ownership or operation of any Drybulk Vessel or (b) the
acquisition of or investment in any Drybulk Vessel Business, other than pursuant to his involvement with (i) any member of
the Company Group, or (ii) a Manager, in compliance with the restrictions on competitive activities set out in the Management
Agreements, as the same may be waived or amended from time to time (together, (a) and (b) are defined as the
“Competitive Activities”).

 

SECTION
3.2 Notwithstanding the foregoing, P. Hajioannou may engage in Competitive Activities (including through any other P. Hajioannou
Entity) in the following circumstances:

 

(a) with
respect to any Permitted Acquisition; provided that any commercial management of Drybulk Vessels that are
controlled by P. Hajioannou (including through any other P. Hajioannou Entity) in connection with the Permitted Acquisition
is performed by either of the Managers;

    	4

    	

    

(b)
with respect to any Drybulk Vessels or Drybulk Vessel Business included in a Non-Drybulk Acquisition; provided that (i)
less than 50% of the fair market value of the Non-Drybulk Acquisition is attributable to the Drybulk Vessels and any related portion
of such business that is solely dedicated to the ownership and operation of such Drybulk Vessels, (ii) P. Hajioannou promptly offers
to sell the Drybulk Vessels and such related portion of the business to the Company for their fair market value plus any Break
Up Costs and the majority of the Independent Directors refuse such offer and (iii) any commercial management of Drybulk Vessels
that are controlled by P. Hajioannou in connection with such Non-Drybulk Acquisition is performed by either of the Managers. For
purposes of this Section 3.2(b), fair market values shall be determined in good faith by the Board of Directors;

 

(c)
with respect to the passive ownership of up to 9.99% of the outstanding voting securities of any publicly traded company
that is a Drybulk Vessel Business in whole or in part; and

 

(d)
with respect to (i) a maximum of eight (8) Drybulk Vessels on the water at any one time and (ii) an unlimited number of
contracts with shipyards for newbuild Drybulk Vessels; in either case, to be directly or indirectly owned, operated or financed
by P. Hajioannou as part of his estate or family planning; provided that, in the same manner contemplated with respect to
a Permitted Acquisition, prior to the acquisition of any such Drybulk Vessels or entry into any such newbuilding contracts, such
Drybulk Vessels or such newbuilding contracts (A) have been first offered to the Company and refused by the majority of the Independent
Directors and (B) have been acquired or invested in on terms and conditions as to price that are not more favorable, and on such
other terms and conditions that are not materially more favorable, to the acquiror than those offered to the Company. For the purpose
of this Section 3.2(d), it is understood and agreed that commercial management for such Drybulk Vessels may be performed
by either of the Managers or any other person or entity.

 

For the avoidance of
doubt, the sale or transfer of any legal or beneficial ownership (in whole or in part) of any Drybulk Vessel or Drybulk Vessel
Business owned or operated, directly or indirectly, by P. Hajioannou or any P. Hajioannou Entity, shall not be subject to any right
of first offer on such proposed sale or other transfer of ownership.

 

SECTION
3.3 Nothing in this Agreement shall be construed to restrict the ability of P. Hajioannou or any other P. Hajioannou Entity
to acquire, invest in, operate, manage or charter any vessel other than Drybulk Vessels or any shipping-related business other
than a Drybulk Vessel Business.

 

SECTION
3.4 In respect of any Drybulk Vessels or contracts for newbuild Drybulk Vessels owned, operated or financed by P. Hajioannou
or any P. Hajioannou Entity other than through the Company (the “Applicable Vessels”), P. Hajioannou shall,
or shall cause a P. Hajioannou Entity to, deliver a written report to the Company within the first quarter of each fiscal year
that contains the following information: (a) in respect of each such Drybulk Vessel so owned, operated or financed, the (i) name,
(ii) flag, (iii) deadweight tons, (iv) year built, (v) country of construction, (vi) class, (vii) charter information with respect
to charters arranged or

    	5

    	

    

in place during the period between the
first day of the previous fiscal year and the date of the report, including the type of charter employment (e.g., time or voyage
charters), the charter rate, commissions paid to brokers or other third parties, the charter period and the total revenues earned
with respect to charters conducted during such period, (viii) running costs with respect to such Drybulk Vessel in the previous
fiscal year, (ix) expected date of next drydocking and the estimated cost of such drydocking, and (x) date of next special survey;
and (b) in respect of each such contract for newbuild Drybulk Vessels, charter information, if any, with respect to charters arranged
as of the date of the report, including the type of charter employment, the charter rate, commissions paid to brokers or other
third parties and the charter period. Additionally, P. Hajioannou shall, or shall cause a P. Hajioannou Entity to, promptly provide
to the Company any clarification and explanation relating to the foregoing that the Company may reasonably request from time to
time.

 

ARTICLE IV

 

NOTICES

 

SECTION
4.1 All notices, consents and other communications hereunder, or necessary to exercise any rights granted hereunder, shall
be in writing, sent either by prepaid registered mail or telefax, and will be validly given if delivered on a Business Day to a
party at its respective address set forth below:

 

Safe Bulkers, Inc.

Apt. D11 – Les Acanthes

6, Avenue des Citronniers

MC98000, Monaco

Attention: President

Telefax: +357 25 887220

 

Polys Hajioannou

c/o Safe Bulkers Management Limited

KPMG Building – Office G1B

Agias Fylaxeos 1 3025 Limassol

Cyprus

Attention: Polys Hajioannou

    	6

    	

    

ARTICLE V

 

APPLICABLE LAW AND JURISDICTION

 

SECTION
5.1 This Agreement shall be governed by, and construed in accordance with, the laws of England.

 

ARTICLE VI

 

ARBITRATION

 

SECTION
6.1 Any dispute arising out of or in connection with this Agreement shall be referred to arbitration in London in accordance
with the Arbitration Act 1996 or any statutory modification or re-enactment thereof save to the extent necessary to give effect
to the provisions of this Article VI. The arbitration shall be conducted in accordance with the London Maritime Arbitrators
Association (LMAA) Terms current at the time when the arbitration proceedings are commenced.

 

SECTION
6.2 The reference shall be to three arbitrators. A party wishing to refer a dispute to arbitration shall appoint its arbitrator
and send notice of such appointment in writing to the other party requiring the other party to appoint its own arbitrator within
14 calendar days of that notice and stating that it will appoint its arbitrator as sole arbitrator unless the other party appoints
its own arbitrator and gives notice that it has done so within the 14 days specified. If the other party does not appoint its own
arbitrator and give notice that it has done so within the 14 days specified, the party referring a dispute to arbitration may,
without the requirement of any further prior notice to the other party, appoint its arbitrator as sole arbitrator and shall advise
the other party accordingly. The award of a sole arbitrator shall be binding on both parties as if he had been appointed by agreement.
Nothing herein shall prevent the parties agreeing in writing to vary these provisions to provide for the appointment of a sole
arbitrator.

 

ARTICLE
VII MISCELLANEOUS

 

SECTION
7.1 This Agreement constitutes the sole understanding and agreement of the parties hereto with respect to the subject matter
hereof and supersedes all prior agreements or understandings, written or oral, with respect thereto, with the exception of the
Hajioannou Entities Restrictive Covenant Agreement and the Management Agreements. This Agreement may not be amended, waived or
discharged except by an instrument in writing executed by the party against whom enforcement of such amendment, waiver or discharge
is sought.

 

SECTION
7.2 It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any
particular provision of this Agreement is adjudicated to be invalid or unenforceable, such provision will be deemed amended to
delete therefrom the portion thus adjudicated as invalid or

    	7

    	

    

unenforceable, such deletion to apply only with respect to the
operation of such provision in the particular jurisdiction in which such adjudications is made.

 

SECTION 7.3
This Agreement may be executed in one or more written counterparts, each of which shall be deemed an original, but all of
which together shall constitute one instrument.

 

[Remainder of page intentionally left
blank.]

    	8

    	

    

IN WITNESS whereof the undersigned have
executed this Agreement as of the date first above written.

 

	 	SAFE BULKERS, INC.	 
	 	 	 
	 	By:  /s/
    Loukas Barmparis

 

	 
	 	Name: Loukas Barmparis	 
	 	Title President	 
	 	 	 
	 	POLYS HAJIOANNOU	 
	 	 	 
	 	 /s/ Polys Hajioannou	 

 

[Signature Page
to Polys Hajioannou Restrictive Covenant Agreement]Exhibit

PICO Holdings, Inc.
Amended and Restated Nonemployee Director Compensation Policy

		
	1.
	General

The PICO Holdings, Inc. Amended and Restated Nonemployee Director Compensation Policy (the “Policy”) is designed to provide for the compensation of each member of the board of directors (the “Board”) of PICO Holdings, Inc. (the “Company”) who is a Nonemployee Director (as defined in the PICO Holdings, Inc. 2014 Equity Incentive Plan (the “EIP”)) (each, a “Nonemployee Director”).  The Policy will become effective on January 1, 2018 and will continue in effect until its termination by the Board.  The Policy will replace and supersede any and all compensation policies or programs previously established or maintained by the Company with respect to Nonemployee Directors.

		
	2.
	Administration

The Policy will be administered by the Board.  The Board will have the sole discretion and authority to administer, interpret, amend and terminate the Policy, and the decisions of the Board will in every case be final and binding on all persons having an interest in the Policy.

		
	3.
	Eligibility

Each Nonemployee Director will be eligible to receive the compensation set forth in the Policy in accordance with the terms of the Policy.  Such compensation will be paid or granted, as applicable, automatically and without further action of the Board to each Nonemployee Director.

		
	4.
	Annual Retainers

(a)General.  Subject to Sections 4(b), 4(c) and 4(d), each Nonemployee Director will be eligible to receive annual retainers (each, an “Annual Retainer”) in the values set forth in the following table, as applicable, for each calendar year of service as a lead independent director and/or member of the Board.  
	
				
	Type of Annual Retainer
	Dollar Value
Per Calendar Year If Paid Fully in Cash
(“Cash Dollar Value”)
	Dollar Value
Per Calendar Year If Paid Fully in RSUs
(“RSU Dollar Value”)

	Board
	Lead Independent Director
	$20,000
	$25,000

	Member
	$35,000
	$43,750

For clarity, an individual will not be eligible to receive any type of Annual Retainer set forth in the table above (the “Table”) unless he or she is a Nonemployee Director on the applicable payment or grant date.  Further, for clarity, each Nonemployee Director will be eligible to receive each type of Annual Retainer set forth in the Table that is applicable to such Nonemployee Director (e.g., if a Nonemployee Director is the lead independent director of the Board, he or she will be eligible to receive (i) an Annual Retainer for service as the lead independent director of the Board and (ii) an Annual Retainer for service as a member of the Board.

(b)Prorated Annual Retainers for Mid-Year Appointees.  Section 4(a) will apply to any Nonemployee Director who is newly appointed as a lead independent director or member of the Board, in each case after January 1 of a calendar year (each, a “Mid-Year Appointee”); provided, however, that with respect to any Annual Retainer for such Mid-Year Appointee’s first (partial) calendar year of service in the role applicable to such Annual Retainer, “Cash Dollar Value” and “RSU Dollar Value” will mean, as applicable, (i) the applicable amount set forth in the Table, multiplied by (ii) a fraction, the numerator of which is the number of days in the period beginning on (and including) the effective date of such Mid-Year Appointee’s appointment to the applicable role and ending on (and including) December 31 of such calendar year and the denominator of which is the total number of days during such calendar year.

(c)Dollar Value of Annual Retainers.  The dollar value of each Annual Retainer payable to a Nonemployee Director will be determined in accordance with the following terms.

(i)If a Nonemployee Director makes an election pursuant to Section 4(d) to receive any portion of an Annual Retainer in the form of cash, the dollar value of such portion will be equal to (A) the applicable Cash Dollar Value (as set 

forth in the Table and adjusted pursuant to Section 4(b), if applicable) or 100% of any lesser amount elected by such Nonemployee Director pursuant to Section 4(d)(i), as applicable, multiplied by (B) the percentage elected by such Nonemployee Director (the “Cash Election Percentage”).

(ii)If a Nonemployee Director makes an election pursuant to Section 4(d) to receive any portion of an Annual Retainer in the form of a restricted stock unit (“RSU”) award, the dollar value of such portion will be equal to (A) the applicable RSU Dollar Value (as set forth in the Table and adjusted pursuant to Section 4(b), if applicable) or 125% of any lesser amount elected by such Nonemployee Director pursuant to Section 4(d)(i), as applicable, multiplied by (B) the percentage elected by such Nonemployee Director (the “RSU Election Percentage”).

(d)Election for Annual Retainers and Annual Awards.

(i)With respect to any Annual Retainer, each Nonemployee Director may make an election (A) to receive the full amount of such Annual Retainer (i.e., based on the applicable Cash Dollar Value and/or RSU Dollar Value (as set forth in the Table and adjusted pursuant to Section 4(b), if applicable)) or any lesser amount (including zero) and (B) to receive any portion of such Annual Retainer in the form of cash or an RSU award.  

(ii)With respect to any Annual Award, each Nonemployee Director may make an election to receive the full amount of such Annual Award (i.e., based on an Annual Award Dollar Value equal to $75,000 and adjusted pursuant to Section 5(c), if applicable) or any lesser amount (including zero) by electing an Annual Award Dollar Value less than $75,000 and adjusted pursuant to Section 5(c), if applicable. 

(iii)With respect to any Annual Retainer or Annual Award for a particular calendar year of service, any election made pursuant to this Section 4(d) (A) must be made on a form provided by the Company, (B) must be made on or before December 31 of the year immediately prior to such calendar year (or such earlier date as required by the Company); provided, however, that any such election made by a Mid-Year Appointee who will become a new member of the Board may be made before the effective date of his or her appointment to the Board, and (C) will be irrevocable once made.

(iv)If a Nonemployee Director does not make an election pursuant to this Section 4(d) or fails to submit such an election on a timely basis, such Nonemployee Director will be deemed to have elected (A) to receive the full amount of his or her Annual Retainer(s), (B) to receive his or her Annual Retainer(s) in the form of cash only, and (C) to receive the full amount of his or her Annual Award.

(e)Terms of Annual Retainers in the Form of Cash.

(i)Subject to Section 4(e)(ii), with respect to any Annual Retainer for a particular calendar year of service, the portion (if any) of such Annual Retainer to be paid in the form of cash, as determined in accordance with Section 4(c)(i), will be paid in substantially equal quarterly installments on January 1, April 1, July 1 and October 1 of such calendar year, provided that the Nonemployee Director is in service in the role applicable to such Annual Retainer on the applicable payment date (e.g., if a Nonemployee Director is the lead independent director of the Board on January 1 but terminates his or her service as such lead independent director on August 1, then with respect to his or her Annual Retainer for service as such lead independent director, he or she will receive the quarterly installments payable on January 1, April 1, and July 1 but not the quarterly installment payable on October 1, regardless of whether he or she is in service as a Nonemployee Director on October 1).

(ii)With respect to any Annual Retainer for a Mid-Year Appointee’s first (partial) calendar year of service in the role applicable to such Annual Retainer, the portion (if any) of such Annual Retainer to be paid in the form of cash will be paid as follows:

(A)     the first installment will be paid on the effective date of such Mid-Year Appointee’s appointment to the applicable role and the amount of such first installment will be equal to (x) the total amount of the portion of such Annual Retainer to be paid in the form of cash, minus (y) an amount equal to the product of (1) 25% multiplied by (2) the applicable Cash Dollar Value (as set forth in the Table, without any adjustment pursuant to Section 4(b)) or 100% of any lesser amount elected by such Mid-Year Appointee pursuant to Section 4(d)(i), as applicable, multiplied by (3) the Cash Election Percentage multiplied by (4) the number of quarterly payment dates (i.e., April 1, July 1 and October 1) remaining in such calendar year after the effective date of such Mid-Year Appointee’s appointment to the applicable role; and

(B)    any remaining installments will be paid in substantially equal amounts on April 1 (if such effective date occurs prior to April 1), July 1 (if such effective date occurs prior to July 1) and October 1 (if such effective date 

occurs prior to October 1) of such calendar year, provided that such Mid-Year Appointee is in service in the role applicable to such Annual Retainer on the applicable payment date.

(f)Terms of Annual Retainers in the Form of RSU Awards.  With respect to any Annual Retainer for a particular calendar year of service, the portion (if any) of such Annual Retainer to be paid in the form of an RSU award will be subject to the following terms.

(i)Such award will be granted under the EIP and will be subject to the terms of the EIP, the applicable award agreement and the Policy.

(ii)Such award will be granted on the first trading day in January of such calendar year; provided, however, that with respect to any such award for a Mid-Year Appointee’s first (partial) calendar year of service in the role applicable to such award, such award will be granted on the effective date of such Mid-Year Appointee’s appointment to the applicable role.

(iii)The number of RSUs subject to such award will be equal to (A) the dollar value of such portion, as determined in accordance with Section 4(c)(ii), divided by (B) the average of the daily volume weighted average prices (“VWAP”) of the Company’s common stock for all of the trading days during the 30 calendar day period ending on (and including) the last trading day immediately prior to the grant date of such award, rounded down to the nearest whole share; provided, however, that the number of RSUs subject to such award, together with any RSUs or shares subject to any other Nonemployee Director Awards (as defined in the EIP) granted to the Nonemployee Director (including any Annual Awards granted under Section 5), may not exceed the limit set forth in Section 5.5 of the EIP.

(iv)Such award will vest in substantially equal quarterly installments on the grant date of such award and on April 1, July 1 and October 1 of the calendar year in which such award is granted; provided, however, that:

(A)    with respect to any such award for a Mid-Year Appointee’s first (partial) calendar year of service in the role applicable to such award, such award will vest as follows:

(x)    the first installment will vest on the effective date of such Mid-Year Appointee’s appointment to the applicable role and the number of RSUs in such first installment will be equal to (1) the total number of RSUs with respect to the portion of such Annual Retainer to be paid in the form of an RSU award, minus (2) an amount equal to the product of (I) 25% multiplied by (II) the number of RSUs that would be subject to the full Annual Retainer (as adjusted if any lesser amount is elected by such Mid-Year Appointee pursuant to Section 4(d)(i)), without any adjustment pursuant to Section 4(b), determined as if the award were granted on the effective date of such Mid-Year Appointee’s appointment to the applicable role, multiplied by (III) the RSU Election Percentage multiplied by (IV) the number of quarterly vesting dates (i.e., April 1, July 1 and October 1) remaining in such calendar year after the effective date of such Mid-Year Appointee’s appointment to the applicable role; and

(y)     any remaining installments will vest in substantially equal amounts on April 1 (if such effective date occurs prior to April 1), July 1 (if such effective date occurs prior to July 1) and October 1 (if such effective date occurs prior to October 1) of such calendar year;

(B)    vesting will be fully accelerated upon a Change in Control (as defined in the EIP), as set forth in Section 13.2 of the EIP; and

(C)    vesting will cease upon the termination of the Nonemployee Director’s service in the role applicable to such Annual Retainer and any RSUs subject to such award that are unvested on the date of such termination will be forfeited by such Nonemployee Director on such date (e.g., if a Nonemployee Director is granted an RSU award with respect to his or her Annual Retainer for service as the lead independent director of the Board, such RSU award will cease vesting upon his or her termination as such lead independent director and any RSUs subject to such award that are unvested on the date of such termination will be forfeited by the Nonemployee Director on such date, regardless of whether he or she continues in service as a Nonemployee Director after such date).

(v)Except as provided in Section 4(f)(vi), the issuance of any shares pursuant to such award, to the extent vested, will occur on the date of the Nonemployee Director’s termination of service as a member of the Board, provided that such termination constitutes a “separation from service” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), subject to Section 7 and the terms of the award agreement.

(vi)Each RSU subject to such award (whether vested or unvested) will be credited with any cash dividend, stock dividend or other distribution that is paid with respect to a share of the Company’s common stock.  Any such dividend or other distribution will be credited to such RSU on the same date and in the same form as such dividend or other distribution is paid to the Company’s shareholders.  Any such dividend or other distribution that is credited to such RSU will be issued (A) on the date of such crediting if such RSU is vested on such date or (B) on the date such RSU becomes vested if such RSU is unvested on the date of such crediting, in each case in the same form paid to the Company’s shareholders.  For clarity, any such dividend or other distribution that is credited to an unvested RSU will be unvested and will only vest and be issued if the underlying RSU vests. 

5.Annual RSU Awards

Each Nonemployee Director will be eligible to receive an annual RSU award (an “Annual Award”) for each calendar year of service as a member of the Board.  For clarity, an individual will not be eligible to receive an Annual Award unless he or she is a Nonemployee Director on the applicable grant date.  Each Annual Award will be subject to the following terms.

(a)Each Annual Award will be granted under the EIP and will be subject to the terms of the EIP, the applicable award agreement and the Policy.

(b)Each Annual Award will be granted on the first trading day in January of the applicable calendar year of service; provided, however, that with respect to any Annual Award for a Mid-Year Appointee’s first (partial) calendar year of service as a member of the Board, such Annual Award will be granted on the effective date of such Mid-Year Appointee’s appointment to the Board.

(c)The number of RSUs subject to each Annual Award will be equal to (i) the Annual Award Dollar Value (as defined below), divided by (ii) the average of the daily VWAP of the Company’s common stock for all of the trading days during the 30 calendar day period ending on (and including) the last trading day immediately prior to the grant date of such Annual Award, rounded down to the nearest whole share; provided, however, that the number of RSUs subject to such Annual Award, together with any RSUs or shares subject to any other Nonemployee Director Awards (as defined in the EIP) granted to the Nonemployee Director (including any RSU awards granted under Section 4), may not exceed the limit set forth in Section 5.5 of the EIP.  For purposes of the foregoing, the “Annual Award Dollar Value” will mean $75,000 or any lesser amount elected by such Nonemployee Director pursuant to Section 4(d)(ii), as applicable; provided, however, that with respect to any Annual Award for a Mid-Year Appointee’s first (partial) calendar year of service as a member of the Board, the “Annual Award Dollar Value” will mean (A) $75,000 multiplied by a fraction, the numerator of which is the number of days in the period beginning on (and including) the effective date of such Mid-Year Appointee’s appointment to the Board and ending on (and including) December 31 of such calendar year and the denominator of which is the total number of days during such calendar year, or (B) any lesser amount elected by such Mid-Year Appointee pursuant to Section 4(d)(ii), as applicable.

(d)Each Annual Award will vest in substantially equal quarterly installments on the grant date of such Annual Award and on April 1, July 1 and October 1 of the calendar year in which such Annual Award is granted; provided, however, that:

(i)with respect to any Annual Award for a Mid-Year Appointee’s first (partial) calendar year of service as a member of the Board, such Annual Award will vest as follows:

(A)     the first installment will vest on the effective date of such Mid-Year Appointee’s appointment to the Board and the number of RSUs in such first installment will be equal to (x) the total number of RSUs subject to such Annual Award, minus (y) an amount equal to the product of (1) 25% multiplied by (2) the number of RSUs that would result if the Annual Award Dollar Value were $75,000 or any lesser amount elected by such Mid-Year Appointee pursuant to Section 4(d)(ii), as applicable, determined as if the Annual Award were granted on the effective date of such Mid-Year Appointee’s appointment to the Board, multiplied by (3) the number of quarterly vesting dates (i.e., April 1, July 1 and October 1) remaining in such calendar year after the effective date of such Mid-Year Appointee’s appointment to the Board; and

(B)     any remaining installments will vest in substantially equal amounts on April 1 (if such effective date occurs prior to April 1), July 1 (if such effective date occurs prior to July 1) and October 1 (if such effective date occurs prior to October 1) of such calendar year;

(ii)vesting will be fully accelerated upon a Change in Control (as defined in the EIP), as set forth in Section 13.2 of the EIP; and

(iii)vesting will cease upon the termination of the Nonemployee Director’s service as a member of the Board and any RSUs subject to such Annual Award that are unvested on the date of such termination will be forfeited by such Nonemployee Director on such date.

(e)Except as provided in Section 5(f), the issuance of any shares pursuant to each Annual Award, to the extent vested, will occur on the date of the Nonemployee Director’s termination of service as a member of the Board, provided that such termination constitutes a “separation from service” within the meaning of Section 409A of the Code, subject to Section 7 and the terms of the award agreement.

(f)Each RSU subject to each Annual Award (whether vested or unvested) will be credited with any cash dividend, stock dividend or other distribution that is paid with respect to a share of the Company’s common stock.  Any such dividend or other distribution will be credited to such RSU on the same date and in the same form as such dividend or other distribution is paid to the Company’s shareholders.  Any such dividend or other distribution that is credited to such RSU will be issued (i) on the date of such crediting if such RSU is vested on such date or (ii) on the date such RSU becomes vested if such RSU is unvested on the date of such crediting, in each case in the same form paid to the Company’s shareholders.  For clarity, any such dividend or other distribution that is credited to an unvested RSU will be unvested and will only vest and be issued if the underlying RSU vests.

6.Expenses

Subject to Section 7, each Nonemployee Director will be eligible for reimbursement from the Company for all reasonable out-of-pocket expenses incurred in connection with his or her duties as a Nonemployee Director.

Each Nonemployee Director may consult the chairperson of the Board on a case-by-case basis with respect to reimbursement for any expenses related to attending any seminars (including the proposed budget for any such seminar).

1.Section 409A

The Company intends that any amounts provided under the Policy be exempt from or comply with the requirements of Section 409A of the Code and the regulations and rulings issued thereunder (collectively, “Section 409A”), and the Policy will be so construed.  Without limiting the generality of the foregoing and notwithstanding any other provision of the Policy to the contrary:

(a)If any amount under the Policy (i) constitutes a “deferral of compensation” within the meaning of Section 409A, (ii) is payable pursuant to an individual’s “separation from service” within the meaning of Section 409A, and (iii) such individual is a “specified employee” within the meaning of Section 409A (determined using the identification methodology selected by the Company from time to time, or if none, the default methodology) as of the date of such individual’s separation from service, then except as otherwise permitted by Section 409A, such amount will be paid to such individual on the date that is six months and one day after such individual’s separation from service or, if earlier, the date of such individual’s death following such separation from service.

(b)Each payment made under the Policy will be treated as a separate payment.

(c)To the extent that any taxable reimbursements are provided to any Nonemployee Director, they will be provided in accordance with Section 409A, including, but not limited to, the following provisions: (i) the amount of any such expenses eligible for reimbursement during such individual’s taxable year may not affect the expenses eligible for reimbursement in any other taxable year; (ii) the reimbursement of an eligible expense must be made no later than the last day of such individual’s taxable year that immediately follows the taxable year in which the expense was incurred; and (iii) the right to any reimbursement may not be subject to liquidation or exchange for another benefit.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}]]