Document:

EX-10.16

 Exhibit 10.16 

CANGO INC. 
 SHARE
INCENTIVE PLAN 2018 

 CANGO INC. 

SHARE INCENTIVE PLAN 2018 
 Cango Inc., a
Cayman Islands exempt company with limited liability (the “Company”), sets forth herein the terms of its Share Incentive Plan 2018 (the “Plan”) as follows: 

 

	1.	PURPOSE 

 The purpose of the Plan is to promote the success and enhance the value of the
Company by linking the personal interests of the members of the Board, Employees and Consultants to those of the Company’s shareholders and by providing such individuals with an incentive for outstanding performance to generate superior returns
to the Company’s shareholders. The Plan is further intended to provide flexibility to the Company in its ability to motivate, attract and retain the services of members of the Board, Employees, and Consultants upon whose judgment, interest and
special efforts the successful conduct of the Company’s operation is largely dependent. 
  

	2.	DEFINITIONS 

 Wherever the following terms are used in the Plan, they shall have the
meanings specified below, unless the context clearly indicates otherwise. The singular pronoun shall include the plural where the context so indicates. 

2.1    “Additional Shares” has the meaning set forth in Section 3.1. 

2.2    “Administrators” has the meaning set forth in Section 11. 

2.3    “Applicable Laws” means the legal requirements relating to the Plan and the Awards under
applicable corporate, securities, tax, foreign exchange and other laws, rules, regulations and government orders, and the rules of any applicable stock exchange or national market system of any applicable jurisdictions. 

2.4    “Award” means Option, Restricted Share, Restricted Share Unit, or any other type of awards granted
to a Participant pursuant to the Plan. 
 2.5    “Award Agreement” means any written agreement,
contract, or other instrument or document evidencing an Award, including the Share Option Grant Agreement, the Restricted Shares Award Agreement, the Restricted Share Units Award Agreement and other written agreement, contract, or other instrument
or document entered into or issued by the Company. 
 2.6    “Board” means the board of directors of
the Company. 
 2.7    “Code” means the Internal Revenue Code of 1986 of the United States, as amended.

  
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 2.8    “Consultant” means any consultant or adviser if:
(a) the consultant or adviser renders bona fide services to a Service Recipient; (b) the services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not
directly or indirectly promote or maintain a market for the Company’s securities; and (c) the consultant or adviser is a natural person who has contracted directly with the Service Recipient to render such services. 

2.9    “Corporate Transaction”, unless otherwise defined in an Award Agreement, means any of the
following transactions, provided, however, that the Administrators shall determine under (d) and (e) whether multiple transactions are related, and their determination shall be final, binding and conclusive: 

(a)    an amalgamation, arrangement or consolidation or scheme of arrangement (i) in which the Company is not the
surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in which the Company is incorporated or (ii) following which the holders of the voting securities of the Company do not continue to hold
more than fifty percent (50%) of the combined voting power of the voting securities of the surviving entity; 

(b)    the sale, transfer or other disposition of all or substantially all of the assets of the Company; 

(c)    the complete liquidation or dissolution of the Company; 

(d)    any reverse takeover or series of related transactions culminating in a reverse takeover (including, without
limitation, a tender offer followed by a reverse takeover) in which the Company is the surviving entity but (A) the Company’s equity securities outstanding immediately prior to such takeover are converted or exchanged by virtue of the
takeover into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities are
transferred to a person or persons different from those who held such securities immediately prior to such takeover or the initial transaction culminating in such takeover, but excluding any such transaction or series of related transactions that
the Administrators determine shall not be a Corporate Transaction; 
 (e)    acquisition in a single or a series of
related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange
Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or a series of related transactions that the Administrators determine
shall not be a Corporate Transaction; 
 (f)    the individuals who, as of the Effective Date, are members of the Board
(the “Incumbent Board”), cease for any reason to constitute at least fifty percent (50%) of the Board; provided that, if the election, or nomination for election by the Company’s shareholders, of any new member of the
Board is approved by the Incumbent Board pursuant to the Shareholders Agreement and the M&AA, such new member of the Board shall be considered as a member of the Incumbent Board; or 

  
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 (g)    the restructuring of the Company, any Parent and Subsidiary for the
purpose of (i) conducting an A-share public offering in the PRC and listing on any national stock exchange in the PRC or (ii) listing on the National Equities Exchange and Quotations of the PRC, in
each case in accordance with the resolutions passed by the shareholders and directors of the Company in accordance with the M&AA. 

2.10    “Disability”, unless otherwise defined in an Award Agreement, has the same meaning as the term of
“permanent and total disability” as defined in Section 22(e)(3) of the Code. 

2.11    “Effective Date” has the meaning set forth in Section 12.1. 

2.12    “Employee” means any person, including an officer or a member of the Board or a member of the
board of any Parent or Subsidiary of the Company or any Related Entity, who is in the employment of a Service Recipient, subject to the control and direction of the Service Recipient as to both the work to be performed and the manner and method of
performance. The payment of a director’s fee by a Service Recipient shall not be sufficient to constitute “employment” by the Service Recipient. 

2.13    “Exchange Act” means the Securities Exchange Act of 1934 of the United States, as amended. 

2.14    “Expiration Date” means the tenth (10th) anniversary of the Effective Date. 

2.15    “Fair Market Value” means, as of any date, the value of Shares determined as follows: 

(a)    If the Shares are listed on one or more established stock exchanges or national market systems, including, without
limitation, the New York Stock Exchange and the Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such Shares (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the
Shares are listed (as determined by the Administrators) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was
reported), as reported in The Wall Street Journal or such other source as the Administrators deem reliable; 

(b)    If the Shares are regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a
recognized securities dealer, its Fair Market Value shall be the closing sales price for such Shares as quoted on such system or by such securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of
a Share shall be the mean between the high bid and low asked prices for the Shares on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or
such other source as the Administrators deem reliable; or 

  
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 (c)    In the absence of an established market for the Shares of the type
described in (a) and (b), above, the Fair Market Value thereof shall be determined by the Administrators in good faith and in their discretion. 

2.16    “Incentive Share Option” means an Option that is intended to meet the requirements of
Section 422 of the Code or any successor provision thereto. 
 2.17    “Independent Director”
means (i) before the Shares are listed on a stock exchange, a member of the Board who is a Non-Employee Director; and (ii) after the Shares are listed on a stock exchange, a member of the Board who
meets the independence standards under the applicable corporate governance rules of the stock exchange. 

2.18    “Initial Shares” has the meaning set forth in Section 3.1. 

2.19    “IPO” has the meaning ascribed to it in the Shareholders Agreement. 

2.20    “M&AA” means the amended and restated memorandum of association of the Company and the
amended and restated articles of association of the Company, each adopted by a special resolution of the Company on March 23, 2018 (as amended from time to time pursuant to the terms thereof). 

2.21    “Non-Employee Director” means a member of the Board who
qualifies as a “Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board. 

2.22    “Non-Qualified Share Option” means an Option that is not
intended to be an Incentive Share Option. 
 2.23    “Option” means a right granted to a Participant
pursuant to Section 5 of the Plan to purchase a specified number of Shares at a specified price during specified time periods. An Option may be either an Incentive Share Option or a Non-Qualified Share
Option. 
 2.24    “Participant” means a person who, as a member of the Board, Consultant or Employee,
has been granted an Award pursuant to the Plan. 
 2.25    “Parent” means a parent corporation under
Section 424(e) of the Code. 
 2.26    “Plan” means this Cango Inc. Share Incentive Plan 2018, as
amended from time to time pursuant to the terms hereof. 
 2.27    “Related Entity” means any business,
corporation, partnership, limited liability company or other entity in which the Company, a Parent or Subsidiary of the Company holds a substantial ownership interest, directly or indirectly, but which is not a Subsidiary and which the
Administrators designate as a Related Entity for purposes of the Plan. 
 2.28    “Restricted Share”
means a Share awarded to a Participant pursuant to Section 6 that is subject to certain restrictions and may be subject to risk of forfeiture. 

  
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 2.29    “Restricted Shares Award Agreement” means an
agreement entered into by and between the Company and a Participant evidencing a grant of an award of Restricted Shares to the Participant by the Company. 

2.30    “Restricted Share Unit” means the right granted to a Participant pursuant to Section 7 to
receive a Share at a future date. 
 2.31    “Restricted Share Units Award Agreement” means an
agreement entered into by and between the Company and a Participant evidencing a grant of an award of Restricted Share Units to the Participant by the Company. 

2.32    “Securities Act” means the Securities Act of 1933 of the United States, as amended. 

2.33    “Service” shall have the meaning ascribed to it in Award Agreement. 

2.34    “Service Recipient” means the Company, any Parent or Subsidiary of the Company and any Related
Entity to which a Participant provides services as an Employee. 
 2.35    “Share” means ordinary
shares, par value US$0.0001 per share, of the Company, and such other securities of the Company that may be substituted for Shares pursuant to Section 10. When referenced in the context of listings on a stock exchange or
quotations on an automated quotation system, “Shares” may also refer to American Depositary Shares or other securities representing the ordinary shares. 

2.36    “Share Option Grant Agreement” means an agreement entered into by and between the Company and a
Participant evidencing a grant of Options to the Participant by the Company. 
 2.37    “Shareholders
Agreement” means the shareholders agreement of the Company, entered into on March 23, 2018 (as amended from time to time pursuant to the terms thereof). 

2.38    “Subsidiary” means any corporation or other entity of which a majority of the outstanding voting
shares or voting power is beneficially owned, directly or indirectly, by the Company. For purposes of this Plan, Subsidiary shall also include any consolidated variable interest entity of the Company. 

2.39    “Trading Date” means the closing of the first sale to the general public of the Shares pursuant
to a registration statement filed with and declared effective by the U.S. Securities and Exchange Commission under the Securities Act. 

2.40    “Vesting Commencement Date” has the meaning ascribed to it in Section 5.1(c). 

  
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	3.	SHARES SUBJECT TO THE PLAN 

  

	 	3.1	Number of Shares. 

 (a)    Subject to the provisions of Sections 10
and 3.1(b), the maximum aggregate number of Shares which may be issued pursuant to all Awards shall initially be equal to 27,845,526 Shares, or such other number of Shares as provided in the Shareholders Agreement, and duly approved by the Board in
accordance with the Shareholders Agreement (the “Initial Shares”). Once the Initial Shares are all issued to Participants, new Shares can be reserved for issuance of Awards under the Plan in accordance with the requirements as
provided in the Shareholders Agreements or otherwise determined by the Board (the “Additional Shares”). 

(b)    To the extent that an Award terminates, expires or lapses for any reason, any Shares subject to the Award shall
again be available for the grant of an Award pursuant to the Plan. To the extent permitted by Applicable Laws, Shares issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form or combination by the
Company or any Parent or Subsidiary of the Company shall not be counted against Shares available for grant pursuant to the Plan. Shares delivered by the Participant or withheld by the Company upon the exercise of any Award under the Plan, in payment
of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder. If any Restricted Shares are forfeited by the Participant or repurchased by the Company, such Shares may again be optioned, granted or
awarded hereunder. Notwithstanding the foregoing and, subject to adjustment as provided in Section 10.1, the maximum number of Shares that may be issued upon the exercise of Incentive Share Options will equal the aggregate Share number stated
in Section 3.1(a), plus, to the extent allowable under Section 422 of the Code and the Treasury Regulations promulgated thereunder, any Shares that become available for issuance under the Plan pursuant to Section 3.1(b). 

 

	 	3.2	Share Distributed. 

 Any Shares distributed pursuant to an Award may consist, in whole or
in part, of authorized and unissued Shares or Shares purchased on the open market. Additionally, in the discretion of the Administrators, American Depository Shares in an amount equal to the number of Shares which otherwise would be distributed
pursuant to an Award may be distributed in lieu of Shares in settlement of any Award. If the number of Shares represented by an American Depository Share is other than on a
one-to-one basis, the limitations of Section 3.1 shall be adjusted to reflect the distribution of American Depository Shares in lieu of Shares. 

 

	4.	ELEGIBILITY AND PARTICIPATION 

  

	 	4.1	Eligibility. 

 Persons eligible to participate in this Plan include Employees,
Consultants, and all members of the Board, as determined by the Administrators. 
  

	 	4.2	Participation. 

 Subject to the provisions of the Plan, the Administrators may, from time
to time, select from among all eligible individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award. No individual shall have any automatic right to be granted an Award pursuant to this Plan. 

  
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	 	4.3	Jurisdictions. 

 In order to assure the viability of Awards granted to Participants
employed in various jurisdictions, the Administrators may provide for such special terms as they may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom applicable in the jurisdiction in which the
Participant resides or is employed. Moreover, subject to the approval requirements as provided in Section 11.1, the Administrators may approve and implement such supplements to, or amendments, restatements or alternative versions of, the Plan
as they may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose. No such supplements, amendments, restatements or alternative versions shall increase the share
limitations contained in Section 3.1 of the Plan unless otherwise approved by the Board. Notwithstanding the foregoing, the Administrators may not take any actions hereunder, and no Awards shall be granted, that would violate any Applicable
Laws. 
  

	5.	OPTIONS 

  

	 	5.1	General. 

 No other types of Awards than Options can be granted with respect to the
Initial Shares. This limitation on types of Awards to be granted is not applicable to the Additional Shares reserved pursuant to Section 3.1 above. The Administrators are authorized to grant Options to Participants on the following terms and
conditions: 
 (a)    Exercise Price. The exercise price per Share subject to an Option granted with respect to
the Initial Shares shall be determined by the Administrators and as approved by the Board. For any Option granted with respect to the Additional Shares, the exercise price per Share subject to such Option shall be determined by the Administrators
and set forth in the Award Agreement which, unless otherwise determined by the Administrators, may be a fixed or variable price determined by reference to the Fair Market Value of the Shares over which such Award is granted; provided, that no
Option may be granted to a recipient subject to U.S. Federal income tax with an exercise price per Share which is less than the Fair Market Value of such Shares on the date of grant (or date of adjustment pursuant to the following sentence), without
compliance with Section 409A of the Code, or the Participant’s consent; provided, further, that Nonstatutory Stock Options may be granted with an exercise price lower than that set forth herein if such Option is granted pursuant to
an assumption or substitution for an option granted by another company, whether in connection with an acquisition of such other company or otherwise; provided, further, that the exercise price per Share shall not in any circumstances be less
than the par value of the Share. The exercise price per Share subject to an Option may be amended or adjusted in the absolute discretion of the Administrators, provided, that such adjustment does not result in a materially adverse impact to
the Participant; provided, further, that the exercise price per Share may not in any circumstances be reduced to less than the par value of the Share. For the avoidance of doubt, to the extent not prohibited by Applicable Laws, a downward
adjustment of the exercise prices of Options mentioned in the preceding sentence shall be effective without the approval of the Board or the Company’s shareholders or the approval of the affected Participants. 

  
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 (b)    Time and Conditions of Grant. An Option can be granted at any
time regardless of whether an IPO occurs. Despite the aforesaid, the Options granted with respect to the Initial Shares under this Plan shall be granted to Participants in four (4) installments. The first installment may be granted within one
(1) month after the date hereof, provided that the number of Options for such installment can only be granted to acquire up to 20% of the Initial Shares. The second, the third and the forth installments shall occur respectively within four
(4) months after the end of the year 2018, 2019 and 2020, with the number of Options being granted to acquire up to 20%, 30% and 30% of the Initial Shares, respectively. Each of the Administrators shall be granted an Option or Options to
acquire up to 30% of the relevant number of the Shares in each of the aforesaid four (4) installments. For the other individuals who are eligible to participate in the Plan, the Administrators shall have the right to determine the number of
individuals eligible to participate in the Plan and the relevant number of the Shares to be granted to such other eligible individuals in their sole discretion. The Administrators shall have the right to determine in their sole discretion the
conditions and standards for the grant of Options which are to be set forth in the Award Agreement or to be separately announced by the Administrators from time to time. 

(c)    Vesting Schedule. No Options granted with respect to the Initial Shares under this Plan are exercisable
prior to one (1) year after the date of grant. Upon expiration of such one (1)-year term (such date, the “Vesting Commencement Date”), the relevant Option to acquire the Initial Shares may be vested with respect to 50% of the
Shares subject to such Option on the first (1st) anniversary following the Vesting Commencement Date. Such Option may be vested with respect to the rest 50% of the Shares subject to such Option in two (2) equal installments (25% each) on the
second (2nd) and third (3rd) anniversary following the Vesting Commencement Date. The Administrators shall also have discretion to determine conditions, if any, that must be satisfied before all or part of an Option may be vested. 

(d)    Time and Conditions of Exercise. Subject to Sections 5.1(c) and (i), the Administrators shall determine the
time or times at which an Option may be exercised in whole or in part; provided that the term of any Option granted under the Plan shall not exceed ten (10) years, except as provided in Section 13.1. For the avoidance of doubt, any
Option granted to a recipient subject to U.S. Federal income tax shall not be exercisable past the 10th anniversary of the grant date. The Administrators shall also have discretion to determine conditions, if any, that must be satisfied before all
or part of an Option may be exercised. 
 (e)    Exercise Procedure. An Option that is exercisable may be
exercised by the Participant’s delivery to the Company of a written notice of exercise on any business day, at the Company’s principal office, in the form specified by the Company. Such notice of exercise shall specify the number of Shares
with respect to which the Option is being exercised and shall be accompanied by payment in full of the exercise price of the Shares for which the Option is being exercised. 

(f)    Payment. To the extent permissible under the Applicable Laws, the Administrators shall determine the
methods by which the exercise price of an Option may be paid, the form of payment, including, without limitation, (i) cash or check denominated in U.S. dollars, (ii) cash or check denominated in Renminbi, (iii) cash or check
denominated in any other local currency as approved by the Administrators, (iv) if the Administrators had so authorized on the grant of any particular Option hereunder (and subject such conditions, if any, as the Administrators may deem
necessary to avoid adverse accounting effects to the Company), that number of Shares having a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, (v) after the Trading Date
the delivery of a notice that the Participant has placed a market sell order with a broker with respect to Shares then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the
sale to the Company in satisfaction of the Option exercise price; provided that payment of such proceeds is then made to the Company upon settlement of such sale, (vi) other property acceptable to the Administrators with a Fair Market
Value equal to the exercise price, or (vii) any combination of the foregoing. Payment of any exercise price may also be made through cashless exercise at the election of the Administrators. 

  
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 (g)    Share Option Grant Agreement. Each grant of an Option shall be
evidenced by a Share Option Grant Agreement. The Share Option Grant Agreement shall include such additional provisions as may be specified by the Administrators. 

(h)    Forfeiture. Except as otherwise determined by the Administrators at the time of the grant of the Award or
thereafter, upon termination of employment or service for whatever reasons, Options that at that time have not been vested shall be forfeited in accordance with the Award Agreement; provided, however, that the Administrators may
(a) provide in any Award Agreement that forfeiture conditions relating to Options will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part forfeiture
conditions relating to Options. 
 (i)    Termination of Employment/Service and Right to Exercise. In case the
Participant’s employment or service is terminated as a result of: 
 (i)    his or her retirement,
death or disability as provided under the Applicable Laws, the relevant Options that at that time have become vested but have not been exercised may be exercisable by the Participant or the executors or administrators of the Participant’s
estate or by any person who has acquired such Options directly from the Participant by beneficiary designation, bequest or inheritance, as the case may be, within six (6) months after the date of termination. With respect to such other Options
that have been exercised, the relevant Shares subject to such Options shall remain at the sole disposal of the Participant or the said executors, administrators or the person indicated under the preceding sentence, as the case may be; 

(ii)    his or her unilateral termination, non-renewal of the
relevant employment contract, layoff or liquidation of the relevant Service Recipient, the relevant Options that at that time have become vested but have not been exercised shall be exercised by the Participant within two (2) months after the
date of termination, otherwise such Options shall be forfeited immediately by the Administrators. With respect to such other Options that have been exercised, the relevant Shares subject to such Options shall remain at the sole disposal of the
Participant; and 

  
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 (iii)    his or her own violation of the Applicable Laws or a
material breach of the relevant employment contract, the relevant Options that have not been exercised shall be forfeited and expire immediately upon the termination. With respect to those Options that have been exercised, the Company shall have the
right to forfeit the relevant Options and repurchase the relevant Shares upon the exercise of relevant Options for consideration of the relevant exercise price or the Fair Market Value of each Share (whichever is lower), if the Company has incurred
material losses or damages as a result of the Participant’s faults. 
  

	 	5.2	Incentive Share Options. 

 Incentive Share Options may be granted to Employees of the
Company, a Parent or Subsidiary of the Company. Incentive Share Options may not be granted to Employees of a Related Entity or to Independent Directors or Consultants. The terms of any Incentive Share Options granted pursuant to the Plan, in
addition to the requirements of Section 5.1, must comply with the following additional provisions of this Section 5.2: 

(a)    Expiration of Option. An Incentive Share Option may not be exercised to any extent by anyone after the
first to occur of the following events: 
 (i)    Ten (10) years from the date it is granted, unless
an earlier time is set in the Award Agreement; and 
 (ii)    Three (3) months after the
Participant’s termination of employment as an Employee (unless otherwise expressly provided in this Plan or the Award Agreement or determined by the Administrators). 

(b)    Transfer Restriction. The Participant shall give the Company prompt notice of any disposition of Shares
acquired by exercise of an Incentive Share Option within (i) two (2) years from the date of grant of such Incentive Share Option or (ii) one (1) year after the transfer of such Shares to the Participant. 

(c)    Expiration of Incentive Share Options. No Award of an Incentive Share Option may be made pursuant to this
Plan after the Expiration Date. 
 (d)    Right to Exercise. During a Participant’s lifetime, an Incentive
Share Option may be exercised only by the Participant. 
  

	6.	RESTRICTED SHARES 

  

	 	6.1	Grant of Restricted Shares. 

 The Administrators, at any time and from time to time, may
grant or sell Restricted Shares to Participants as the Administrators shall determine. The Administrators shall determine the number of Restricted Shares to be granted or sold to a Participant. Despite the aforesaid, Restricted Shares can only be
granted or sold with respect to the Additional Shares. 

  
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	 	6.2	Restricted Shares Award Agreement. 

 Each award of Restricted Shares shall be evidenced
by a Restricted Shares Award Agreement, which shall specify the period of restriction, the number of Restricted Shares granted or sold, grant or purchase price, and such other terms and conditions as the Administrators shall determine. 

 

	 	6.3	Restrictions. 

 Restricted Shares shall be subject to such restrictions on
transferability and other restrictions as the Administrators may impose (including, without limitation, limitations on the right to vote Restricted Shares or the right to receive dividends on the Restricted Share). These restrictions may lapse
separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as the Administrators determine at the time of the grant of the Award or thereafter. 

 

	 	6.4	Forfeiture/Repurchase. 

 Except as otherwise determined by the Administrators at the time
of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Shares that are at that time subject to restrictions shall be forfeited or repurchased in accordance with the
Award Agreement; provided, however, that the Administrators may (a) provide in any Restricted Shares Award Agreement that restrictions or forfeiture and repurchase conditions relating to Restricted Shares will be waived in whole
or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture and repurchase conditions relating to Restricted Shares. 

 

	 	6.5	Certificates for Restricted Shares. 

 Restricted Shares granted pursuant to the Plan may
be evidenced in such manner as the Administrators shall determine. If certificates representing Restricted Shares are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions and
restrictions applicable to such Restricted Shares, and the Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse. 

 

	 	6.6	Removal of Restrictions. 

 Unless the Administrators determine otherwise, Restricted
Shares shall be held by the Company as escrow agent until the restrictions on such Restricted Shares have lapsed. Except as otherwise provided in this Section 6, Restricted Shares granted under the Plan shall be released from escrow as soon as
practicable after the last day of the period of restriction. The Administrators, in their discretion, may accelerate the time at which any restrictions shall lapse or be removed. After the restrictions have lapsed, the Participant shall be entitled
to have any legend or legends under Section 6.5 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant, subject to the Shareholders Agreement, the M&AA, and applicable legal restrictions.
The Administrators, in their discretion, may establish procedures regarding the release of Shares from escrow and the removal of legends, as necessary or appropriate to minimize administrative burdens on the Company. 

  
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	7.	RESTRICTED SHARE UNITS 

  

	 	7.1	Grant of Restricted Share Units. 

 The Administrators, at any time and from time to time,
may grant Restricted Share Units to Participants as the Administrators shall determine. The Administrators shall determine the number of Restricted Share Units to be granted to each Participant. Despite the aforesaid, Restricted Share Units can only
be granted with respect to the Additional Shares. 
  

	 	7.2	Restricted Share Units Award Agreement. 

 Each award of Restricted Share Units shall be
evidenced by a Restricted Share Units Award Agreement, which shall specify any vesting conditions, the number of Restricted Share Units granted, and such other terms and conditions as the Administrators shall determine. 

 

	 	7.3	Performance Objectives and Other Terms. 

 The Administrators, in their discretion, may
set performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine the number or value of Restricted Share Units that will be paid out to the Participants. 

 

	 	7.4	Form and Timing of Payment of Restricted Share Units. 

 At the time of grant, the
Administrators shall specify the date or dates the Restricted Share Units shall become fully vested and non-forfeitable. Upon vesting, the Administrators, in their sole discretion, may pay Restricted Share Units in the form of cash, in Shares or in
a combination thereof. 
  

	 	7.5	Forfeiture/Repurchase. 

 Except as otherwise determined by the Administrators at the time
of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Share Units that are at that time unvested shall be forfeited or repurchased in accordance with the Award
Agreement; provided, however, the Administrators may (a) provide in any Restricted Share Units Award Agreement that restrictions or forfeiture and repurchase conditions relating to Restricted Share Units will be waived in whole or
in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture and repurchase conditions relating to Restricted Share Units. 

 

	8.	OTHER TYPE OF AWARDS 

 The Administrators, at any time and from time to time, may grant
other types of Awards to Participants as the Administrators shall determine, including, without limitation, share appreciation rights, dividend equivalents, share payments and deferred shares. Despite the aforesaid, such other types of Awards can
only be granted with respect to the Additional Shares. 

  
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	9.	PROVISIONS APPLICABLE TO AWARDS 

  

	 	9.1	Award Agreement. 

 Awards under the Plan shall be evidenced by Award Agreements that set
forth the terms, conditions and limitations for each Award, which may include the term of an Award, the provisions applicable in the event the Participant’s employment or service terminates, and the Company’s authority to unilaterally or
bilaterally amend, modify, suspend, cancel or rescind an Award. 
  

	 	9.2	Limits on Transfer. 

 Unless with prior written consent of the Administrators, no right
or interest of a Participant in any Award may be pledged, encumbered, or hypothecated to or in favor of any party other than the Company, a Parent, a Subsidiary or a Related Entity, or shall be subject to any lien, obligation, or liability of such
Participant to any other party other than the Company, a Parent, a Subsidiary or a Related Entity. Except as otherwise provided by the Administrators, no right or interest of a Participant in any Award shall be assigned, transferred or otherwise
disposed of by such Participant other than by will or the laws of descent and distribution. The Administrators by express provision in the Award or an amendment thereto may permit an Award (other than an Incentive Share Option) to be transferred to,
exercised by and paid to certain persons or entities related to the Participant, including, without limitation, members of the Participant’s family, charitable institutions, or trusts or other entities whose beneficiaries or beneficial owners
are members of the Participant’s family and/or charitable institutions, or to such other persons or entities as may be expressly approved by the Administrators, pursuant to such conditions and procedures as the Administrators may establish. Any
permitted transfer shall be subject to the condition that the Administrators receive evidence satisfactory to them that the transfer is being made for estate and/or tax planning purposes (or to a “blind trust” in connection with the
Participant’s termination of employment or service with the Company, a Parent, a Subsidiary or a Related Entity to assume a position with a governmental, charitable, educational or similar non-profit
institution) and on a basis consistent with the Company’s lawful issue of securities. 
  

	 	9.3	Beneficiaries. 

 Notwithstanding Section 9.2, a Participant may, in the manner
determined by the Administrators, designate a beneficiary to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participant’s death. A beneficiary, legal guardian, legal representative, or
other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any
additional restrictions deemed necessary or appropriate by the Administrators. If the Participant is married and resides in a community property state, a designation of a person other than the Participant’s spouse as his or her beneficiary with
respect to more than 50% of the Participant’s interest in the Award shall not be effective without the prior written consent of the Participant’s spouse. If no beneficiary has been designated or survives the Participant, payment shall be
made to the person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided that the
change or revocation is filed with the Administrators. 

  
 -13- 

	 	9.4	Share Certificates. 

 Notwithstanding anything herein to the contrary, the Company shall
not be required to issue or deliver any certificates evidencing the Shares pursuant to the exercise of any Award, unless and until the Administrators have determined, with advice of counsel, that the issuance and delivery of such certificates is in
compliance with all Applicable Laws, the provisions of the Shareholders Agreement and the M&AA. All Share certificates delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions as the Administrators deem
necessary or advisable to comply with all Applicable Laws, the provisions of the Shareholders Agreement and the M&AA. The Administrators may place legends on any Share certificate to reference restrictions applicable to the Shares. In addition
to the terms and conditions provided herein, the Administrators may require that a Participant make such reasonable covenants, agreements and representations as the Administrators, in their discretion, deem advisable in order to comply with any such
Applicable Laws, the provisions of the Shareholders Agreement and the M&AA. The Administrators shall have the right to require any Participant to comply with any timing or other restrictions with respect to the settlement or exercise of any
Award, including a window-period limitation, as may be imposed in the discretion of the Administrators. 
  

	 	9.5	Paperless Administration. 

 Subject to Applicable Laws, the Administrators may make
Awards, provide applicable disclosure and procedures for exercise of Awards by an internet website or interactive voice response system for the paperless administration of Awards. 

 

	 	9.6	Foreign Currency. 

 A Participant may be required to provide evidence that any currency
used to pay the exercise price of any Award were acquired and taken out of the jurisdiction in which the Participant resides in accordance with Applicable Laws, including foreign exchange control laws and regulations. In the event the exercise price
for an Award is paid in Renminbi or other foreign currency, as permitted by the Administrators, the amount payable will be determined by conversion from U.S. dollars at the official rate promulgated by the People’s Bank of China for Renminbi,
or for jurisdictions other than the People’s Republic of China, the exchange rate as selected by the Administrators on the date of exercise. 
  

	10.	CHANGES IN CAPITAL STRUCTURE 

  

	 	10.1	Adjustments. 

 In the event of any share dividend, share split, combination or exchange
of Shares, amalgamation, arrangement or consolidation, spin-off, recapitalization or other distribution (other than normal cash dividends) of Company assets to its shareholders, or any other change affecting
the Shares or the price of a Share, the Administrators shall make such proportionate adjustments, if any, to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the Plan (including, without
limitation, adjustments of the limitations in Section 3.1); (b) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the number of
shares covered by an Award or exercise price per share for any outstanding Awards under the Plan; provided, however, that the Administrators will make such adjustments to an Award required by Section 25102(o) of the California Corporations Code
to the extent the Company is relying upon the exemption afforded thereby with respect to the Award. 

  
 -14- 

	 	10.2	Corporate Transactions. 

 Except as may otherwise be provided in any Award Agreement or
any other written agreement entered into by and between the Company and a Participant, if the Administrators anticipate the occurrence, or upon the occurrence, of a Corporate Transaction, the Administrators may provide for the following measures in
its discretion without the consent of a Participant: (i) any and all Awards outstanding hereunder to terminate at a specific time in the future and shall give each Participant the right to exercise the vested portion of such Awards during a
period of time as the Administrators shall determine, (ii) the purchase of any Award for an amount of cash equal to the amount that could have been attained by the Participant upon the exercise of such Award (and, for the avoidance of doubt, if
as of such date the Administrators determine in good faith that no amount would have been attained by the Participant upon the exercise of such Award, then such Award may be terminated by the Administrators without payment), (iii) the replacement of
such Award with other rights or property selected by the Administrators or the assumption of or substitution of such Award by the successor or surviving corporation, or a Parent or Subsidiary thereof, with appropriate adjustments as to the number
and kind of Shares and prices, (iv) payment of Award in cash based on the value of Shares on the date of the Corporate Transaction through the date when such Award would otherwise be vested or have been paid in accordance with its original
terms, if necessary to comply with Section 409A of the Code, or (v) any combination of the foregoing. In taking any of the actions permitted under this Section 10.2, the Administrators will not be obligated to treat all Awards, all
Awards held by a Participant, or all Awards of the same type, similarly. 
  

	 	10.3	Outstanding Awards — Other Changes. 

 In the event of any other change in the
capitalization of the Company or corporate change other than those specifically referred to in this Section 10, the Administrators may, in their absolute discretion, make such adjustments in the number and class of shares subject to Awards
outstanding on the date such change occurs and in the per share grant or exercise price of each Award as the Administrators may consider appropriate to prevent dilution or enlargement of rights; provided, however, that the Administrators will make
such adjustments to an Award required by Section 25102(o) of the California Corporations Code to the extent the Company is relying upon the exemption afforded thereby with respect to the Award. 

 

	 	10.4	Acceleration upon IPO. 

 In the event of the occurrence of an IPO, the Administrators may
at their discretion accelerate the vesting and/or cause the immediate exercise of the relevant Options. For the avoidance of doubt, for the purpose of this Section 10.4, “accelerate the vesting and/or cause the immediate exercise”
means acceleration of (a) the vesting of Options granted under the Plan, (b) the exercise of the Options granted under the Plan, and (c) the combination of (a) and (b), such that outstanding unvested Options would both vest and
be exercised. 

  
 -15- 

	 	10.5	No Other Rights. 

 Except as expressly provided in the Plan, no Participant shall have
any rights by reason of any subdivision or consolidation of Shares of any class, the payment of any dividend, any increase or decrease in the number of shares of any class or any dissolution, liquidation, merger, or consolidation of the Company or
any other corporation. Except as expressly provided in the Plan or pursuant to action of the Administrators under the Plan, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number of shares subject to an Award or the grant or exercise price of any Award. 
  

	11.	ADMINISTRATION 

  

	 	11.1	Administrators. 

 The Plan shall be jointly administered by the ZHANG Xiaojun (张晓俊) and LIN Jiayuan
(林佳元) (collectively, the “Administrators”) in accordance with this Plan, the
Shareholders Agreement and the M&AA. For the avoidance of doubt and notwithstanding anything to the contrary in the Plan, the adoption, amendment, general implementation or termination of the Plan and any determinations regarding the grant or
issuance of Awards pursuant to the Plan shall require the approval of the Board pursuant to the Shareholders Agreement. 
  

	 	11.2	Action by the Administrators. 

 The Administrators are entitled to, in good faith, rely
or act upon any report or other information furnished to them by any officer or other employee of the Company, any Parent or Subsidiary or Related Entity, the Company’s independent certified public accountants, or any executive compensation
consultant or other professional retained by the Company to assist in the administration of the Plan. 
  

	 	11.3	Authority of the Administrators. 

 Subject to any other provisions in the Plan, the
Shareholders Agreement and the M&AA, the Administrators jointly have the exclusive power, authority and discretion to: 

(a)    Prescribe, interpret and revise the relevant performance criteria for grant of an Award; 

(b)    Designate Participants to receive Awards; 

(c)    Determine the type or types of Awards to be granted to each Participant; 

(d)    Determine the number of Awards to be granted and the number of Shares to which an Award will relate; 

  
 -16- 

 (e)    Determine the terms and conditions of any Award granted pursuant to
the Plan, including, without limitation, the date of grant, the exercise price, grant price, or purchase price, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of
an Award, and accelerations or waivers thereof, any provisions related to non-competition and recapture of gain on an Award, based in each case on such considerations as the Administrators determine; 

(f)    Determine whether, to what extent, and pursuant to what circumstances an Award may be settled in, or the exercise
price of an Award may be paid in, cash, Shares, other Awards or other property, or an Award may be canceled, forfeited or surrendered; 

(g)    Revise or terminate the provisions of the Plan pursuant to the actual circumstances of the Company and its
development plans, and submit the proposed revisions or termination for the approval of the Board; 
 (h)    Prescribe,
amend and adjust the form of each Award Agreement, which need not be identical for each Participant; 
 (i)    Decide
all other matters that must be determined in connection with an Award; 
 (j)    Establish, adopt or revise any rules
and regulations as they may deem necessary or advisable to administer the Plan; 
 (k)    Interpret the terms of, and
any matter arising pursuant to, the Plan or any Award Agreement; and 
 (l)    Make all other decisions and
determinations that may be required pursuant to the Plan or as the Administrators deem necessary or advisable to administer the Plan. 
  

	 	11.4	Decisions Binding. 

 The Administrators’ interpretation of the Plan, any Awards
granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Administrators with respect to the Plan are final, binding and conclusive on all parties, except those matters that require due approval of the Board as
provided in Section 11.1 above. 
  

	12.	EFFECTIVE AND EXPIRATION DATE 

  

	 	12.1	Effective Date. 

 The Plan is effective as of the date it is adopted and duly approved by
the Board pursuant to the Shareholders Agreement. 

  
 -17- 

	 	12.2	Replacement of Previous Arrangements. 

 The Plan, the specific implementation rules as
duly approved by the Board (if any) and all Awards Agreement shall constitute the entire document in relation to the Company’s share incentive arrangements, and shall replace any and all previous share incentive arrangements of the Company, any
Parent and any Subsidiary in its entirety, and such arrangements shall cease to be effective upon the Effective Date. 
  

	 	12.3	Expiration Date. 

 The Plan will expire on, and no Award may be granted pursuant to the
Plan after, the Expiration Date. Any Awards that are outstanding on the Expiration Date shall remain in force according to the terms of the Plan and the applicable Award Agreement. 

 

	13.	AMENDMENT, MODIFICATION, AND TERMINATION 

  

	 	13.1	Amendment, Modification and Termination. 

 At any time and from time to time, the
Administrators may terminate, amend or modify the Plan; provided, however, to the extent necessary to comply with Applicable Laws, the Shareholders Agreement and the M&AA, the Company shall obtain the Board approval of any Plan
amendment in such a manner and to such a degree as required. 
  

	 	13.2	Awards Previously Granted. 

 Except with respect to amendments made pursuant to
Section 14.15, no termination, amendment or modification of the Plan shall adversely affect in any material way any Award previously granted pursuant to the Plan without the prior written consent of the Participant. 

 

	14.	GENERAL PROVISIONS 

  

	 	14.1	No Rights to Awards. 

 No Participant, employee or other person shall have any claim to
be granted any Award pursuant to the Plan, and neither the Company nor the Administrators are obligated to treat Participants, employees and other persons uniformly. 
  

	 	14.2	No Shareholders Rights. 

 No Award gives the Participant any of the rights of a
Shareholder of the Company unless and until Shares are in fact issued to such person in connection with such Award. 

  
 -18- 

	 	14.3	Taxes. 

 No Shares shall be delivered under the Plan to any Participant until such
Participant has made arrangements acceptable to the Administrators for the satisfaction of any income and employment tax withholding obligations under Applicable Laws. The Company or any Subsidiary shall have the authority and the right to deduct or
withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy all applicable taxes (including the Participant’s payroll tax obligations) required or permitted by Applicable Laws to be withheld with respect to any
taxable event concerning a Participant arising as a result of this Plan. The Administrators may in their discretion and in satisfaction of the foregoing requirement allow a Participant to elect to have the Company withhold Shares otherwise issuable
under an Award (or allow the return of Shares) having a Fair Market Value equal to the sums required to be withheld. Notwithstanding any other provision of the Plan, the number of Shares which may be withheld with respect to the issuance, vesting,
exercise or payment of any Award (or which may be repurchased from the Participant of such Award after such Shares were acquired by the Participant from the Company) in order to satisfy any income and payroll tax liabilities applicable to the
Participant with respect to the issuance, vesting, exercise or payment of the Award shall, unless specifically approved by the Administrators, be limited to the number of Shares which have a Fair Market Value on the date of withholding or repurchase
equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for the applicable income and payroll tax purposes that are applicable to such supplemental taxable income. 

 

	 	14.4	No Right to Employment or Services. 

 Nothing in the Plan or any Award Agreement shall
interfere with or limit in any way the right of the Service Recipient to terminate any Participant’s employment or services at any time, nor confer upon any Participant any right to continue in the employment or services of any Service
Recipient. 
  

	 	14.5	Unfunded Status of Awards. 

 The Plan is intended to be an “unfunded” plan for
incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of
the Company or any Parent, Subsidiary or Related Entity. 
  

	 	14.6	Indemnification. 

 To the extent allowable pursuant to Applicable Laws, the
Administrators shall be indemnified and held harmless by the Company from any loss, cost, liability or expense that may be imposed upon or reasonably incurred by them in connection with or resulting from any claim, action, suit, or proceeding to
which they may be a party or in which they may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by them in satisfaction of judgment in such action, suit, or proceeding against
them; provided that they give the Company an opportunity, at its own expense, to handle and defend the same before they undertake to handle and defend it on their own behalf. The foregoing right of indemnification shall not be exclusive of
any other rights of indemnification to which the Administrators may be entitled pursuant to the Shareholders Agreement and the M&AA, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them
harmless. 

  
 -19- 

	 	14.7	Relationship to other Benefits. 

 No payment pursuant to the Plan shall be taken into
account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Parent, Subsidiary or Related Entity except to the extent otherwise expressly
provided in writing in such other plan or an agreement thereunder. 
  

	 	14.8	Expenses. 

 The expenses of administering the Plan shall be borne by the Company and its
Subsidiaries. 
  

	 	14.9	Titles and Headings. 

 The titles and headings of the Sections in the Plan are for
convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control. 
  

	 	14.10	Fractional Shares. 

 No fractional Shares shall be issued and the Administrators shall
determine, in their discretion, whether cash shall be given in lieu of fractional Shares or whether such fractional Shares shall be eliminated by rounding up or down as appropriate. 

 

	 	14.11	Limitations Applicable to Section 16 Persons. 

 Notwithstanding any other provision
of the Plan, the Plan, and any Award granted or awarded to any Participant who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of
the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by the Applicable Laws, the Plan and
Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule. 
  

	 	14.12	Government and Other Regulations. 

 The obligation of the Company to make payment of
awards in Shares or otherwise shall be subject to all Applicable Laws, and to such approvals by government agencies as may be required. The Company shall be under no obligation to register any of the Shares paid pursuant to the Plan under the
Securities Act or any other similar law in any applicable jurisdiction. If the Shares paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act or other Applicable Laws, the Company may
restrict the transfer of such Shares in such manner as it deems advisable to ensure the availability of any such exemption. 

  
 -20- 

	 	14.13	Governing Law. 

 The Plan and all Award Agreements shall be construed in accordance with
and governed by the laws of the Cayman Islands. 
  

	 	14.14	Sections 409A and 457A. 

 To the extent that the Administrators determine that any Award
granted under the Plan is or may become subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code. To the extent applicable, the Plan and
the Award Agreements shall be interpreted in accordance with Section 409A of the Code and the U.S. Department of Treasury regulations and other interpretative guidance issued thereunder, including without limitation, any such regulation or
other guidance that may be issued after the Effective Date. Notwithstanding any provision of the Plan to the contrary, in the event that following the Effective Date the Administrators determine that any Award may be subject to Section 409A of
the Code and related Department of Treasury guidance (including such Department of Treasury guidance as may be issued after the Effective Date), the Administrators may adopt such amendments to the Plan and the applicable Award agreement or adopt
other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Administrators determine are necessary or appropriate to (a) exempt the Award from Section 409A of
the Code and Section 457A of the Code and/or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and related U.S. Department of
Treasury guidance. 
  

	 	14.15	Appendices. 

 Subject to the approval requirements as provided in Section 11.1
above, the Administrators may approve such supplements, amendments or appendices to the Plan as they may consider necessary or appropriate for purposes of compliance with Applicable Laws or otherwise and such supplements, amendments or appendices
shall be considered a part of the Plan; provided, however, that no such supplements shall increase the share limitation contained in Section 3.1 of the Plan without the due approval of the Board. 

  
 -21-Exhibit 10.1

 

SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT

 

THIS SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is entered into effective June 21, 2018, by and between Tailored Brands, Inc., a Texas corporation (the “Company”), Tailored Shared Services, LLC, a Delaware limited liability company (“SSU”), and Douglas S. Ewert (“Executive”), amending and restating the Amended and Restated Employment Agreement dated April 22, 2015 (the “Prior Restatement”),  between The Men’s Wearhouse, Inc., a Texas corporation ( “TMW”), and the Executive, as amended and assigned pursuant to the Assignment and Amendment dated January 31, 2016 (the “Assignment”), between the Company, SSU, TMW and the Executive. References in this Agreement to Effective Date shall mean April 22, 2015.

 

WHEREAS, TMW and Executive entered into the Prior Restatement;

 

WHEREAS, TMW entered into a corporate restructuring pursuant to which TMW became a wholly owned subsidiary of the Company and in connection therewith TMW, the Company, SSU and the Executive entered into the Assignment pursuant to which the Company was substituted for TMW under the Prior Restatement;

 

WHEREAS, under the terms of the Prior Restatement the Executive’s Employment thereunder was extended by automatic renewal for a period of one year beginning on April 22, 2018;

 

WHEREAS, the Company and the Executive desire to enter into this Second Amended and Restated Agreement to reflect the substitution of the Company for TMW and to make certain clarifying changes to, and update certain references in, the Prior Restatement;

 

WHEREAS, the Company desires to be assured that the unique and expert services of Executive will be available to the Company and its subsidiaries, and that Executive is willing and able to render such services on the terms and conditions hereinafter set forth;

 

WHEREAS, the Company desires to be assured that the confidential information and good will of each of the Company and its subsidiaries will be preserved for the exclusive benefit of the Company and its affiliates; and

 

WHEREAS, the Executive is a participant in the Company’s Amended and Restated Senior Executive Change in Control Severance Plan (as the same may be amended from time to time, the “Change in Control Plan”).

 

NOW THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, the Company and Executive hereby agree to amend and restate the Prior Restatement to read as follows:

 

1.                                      Employment and Duties.  The Company hereby agrees to employ Executive as Chief Executive Officer of the Company, and Executive hereby accepts such employment and agrees to serve the Company in such capacity on the terms and subject to the conditions set forth in this Agreement. Executive hereby acknowledges and agrees that while he serves as the Chief Executive Officer of the Company, he will be formally employed by SSU, an indirect wholly owned subsidiary of the Company.

 

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2.                                      Term.  Executive’s employment under this Agreement shall continue, subject to earlier termination of such employment pursuant to the terms hereof, from the Effective Date until the third anniversary of the Effective Date   (the “Employment Period”).  On the third anniversary of the Effective Date and on each anniversary thereof, the Employment Period shall be automatically extended for an additional twelve-month period; provided, however, that the Company or Executive may elect to terminate the automatic extension of the Employment Period by giving written notice of such election to the other party not less than 90 days prior to the end of the Employment Period (including any twelve-month extension thereof).

 

3.                                      Duties.  During the Employment Period, Executive shall serve on a full-time basis and perform services in a managerial capacity in a manner consistent with Executive’s position as Chief Executive Officer of the Company and Executive’s duties and responsibilities shall include those duties customarily attendant to the position of Chief Executive Officer and such other duties and responsibilities as may be assigned to him from time to time by the Company’s board of directors (the “Board”) consistent with his position as Chief Executive Officer. Executive shall devote his entire business time, attention and energies (excepting vacation time, holidays, sick days and periods of disability) and use his best efforts in his employment with the Company; provided, however, that this Agreement shall not be interpreted as prohibiting Executive from managing his personal affairs, including personal investments and engaging in charitable or civic activities, so long as such activities do not interfere in any material respect with the performance of Executive’s duties and responsibilities hereunder.  During his employment hereunder, Executive may serve on the board of directors of up to one other public company with the prior consent of the Board, which consent shall not be unreasonably withheld; provided, however, that such service does not violate Section 9 of this Agreement or otherwise interfere in any material respect with the performance of Executive’s duties and responsibilities hereunder.

 

4.                                      Compensation and Benefits of Employment.

 

(a)                                 Base Salary.  As compensation for the services to be rendered by Executive hereunder, the Company shall pay to Executive a base annual salary (“Annual Salary”) of $1,250,000 per year, in equal installments in accordance with the customary payroll practices of the Company.  The parties shall comply with all applicable withholding requirements in connection with all compensation payable to Executive.  The Company’s Board may, in its sole discretion, review and adjust upward Executive’s Annual Salary from time to time, which shall have the effect of automatically amending this Section 4(a) accordingly, but in no event may any downward adjustments in Executive’s Annual Salary be made during the Employment Period.

 

(b)                                 Annual Bonus.  In addition to the Annual Salary, Executive shall have an opportunity to earn an annual cash bonus (the “Bonus”) in respect of each fiscal year of the Company in accordance with the terms of the Company’s annual cash bonus program for executive officers then existing for such fiscal year based on the achievement of performance objectives as may be established from time to time by the Board or a committee thereof; provided, however, that, except as otherwise provided herein, the Bonus for any fiscal year shall be payable to Executive only if Executive is employed by the Company on the date on which such Bonus is paid.  In no event will such Bonus be paid later than the last day of the third month following the close of the Company’s fiscal year to which such Bonus relates.  Executive’s target annual bonus opportunity shall be set from time to time by the Board or a committee thereof in a manner consistent with his position, but such bonus opportunity shall not be less than 100% of the Annual Salary for the year with respect to which such bonus is being set (the “Target Bonus”).  The actual

 

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Bonus payable may be greater or lesser than the Target Bonus and shall be determined consistent with the criteria set for other senior management executives at the Company by the Board or a committee thereof, based on such factors as it shall determine.

 

(c)                                  Benefits.  Executive shall be entitled to participate in and have the benefits under the terms of all life, accident, disability and health insurance plans, pension, profit sharing, incentive compensation and savings plans and all other similar plans and benefits which the Company from time to time makes available to its senior management executives in the same manner and at least at the same participation level as other senior management executives.  During the Employment Period, Executive shall be covered under the indemnification provisions of the Company’s bylaws (which shall provide coverage to the maximum extent permitted by applicable law) and such coverage shall not be reduced or materially modified, and Executive shall be entitled to receive coverage on a non-discriminatory basis under any director and officer insurance policies which the Company may have in place from time to time. All such coverage shall include coverage following the end of the Employment Period with respect to Executive’s actions or inactions during the Employment Period.

 

(d)                                 Equity Grant; Equity Plans or Programs.  Annually at the time the Compensation Committee of the Board regularly approves grants of equity awards to executive officers but in any event no later than the last day of May of each year, the Company shall award Executive with grants of  restricted stock, deferred stock units, performance units or stock options, or some combination thereof, under the Company’s 2016 Long Term Incentive Plan or a successor plan approved by the shareholders of the Company, in a manner and amount consistent with awards made to other executive officers of the Company and consistent, in relation thereto, with Executive’s position in the Company.

 

(e)                                  Vacation.  Executive shall be entitled to not less than 20 days of paid vacation per fiscal year of the Company, which shall be in accordance with the Company’s vacation policy in effect from time to time for its senior management executives.

 

5.                                      Business Expenses.  The Company shall promptly reimburse Executive for all appropriately documented, reasonable business expenses incurred by Executive in accordance with the Company’s policies related thereto and an amount up to $40,000 for documented legal fees and expenses incurred by Executive in connection with his entering into this Agreement.

 

6.                                      Termination of Employment Period.  Executive’s employment hereunder may be terminated as follows:

 

(a)                                 Death.  The Employment Period shall end automatically on the date of Executive’s death.

 

(b)                                 Permanent Disability.  The Company shall be entitled to terminate Executive’s employment hereunder by reason of Executive becoming Permanently Disabled (defined below) by written notice to Executive or his personal representative.  For purposes of this Agreement, Executive shall be deemed “Permanently Disabled” if Executive shall be considered to be permanently and totally disabled in accordance with the Company’s disability plan, if any, for a period of 180 days or more.  If there should be a dispute between the Company and Executive as to Executive’s physical or mental disability for purposes of this Agreement, the question shall be settled by the opinion of an impartial reputable physician or psychiatrist agreed upon by the

 

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parties or their representatives, or if the parties cannot agree within ten (10) calendar days after a request for designation of such party, then a physician or psychiatrist shall be designated by the President of the Stanford University School of Medicine.  The parties agree to be bound by the final decision of such physician or psychiatrist.

 

(c)                                  Termination Without Cause.  The Company may terminate Executive’s employment hereunder at any time and for any reason.

 

(d)                                 Termination With Cause.  The Company may terminate this Agreement at any time if such termination is for Cause (defined below) by delivering to Executive written notice describing the cause of termination, but with respect to (d)(ii) and (iv) below, only after allowing Executive 30 days to cure the Cause.  “Cause” shall be limited to the occurrence of the following events: (i) Executive’s conviction of or a plea of nolo contendere to the charge of a felony (which, through lapse of time or otherwise, is not subject to appeal); (ii) Executive’s willful and continued refusal without proper legal cause to perform Executive’s duties and responsibilities after a written demand for performance is delivered to Executive by the Board which specifically identifies the manner in which the Board believes Executive has refused to perform his duties and responsibilities or Executive’s gross negligence in performing his duties and responsibilities; (iii) Executive’s material breach of fiduciary duty to the Company through the misappropriation of Company funds or property or through fraud; (iv) Executive’s material breach or default of his obligations under Section 9 of this Agreement or any other agreement with the Company containing restrictive covenants or willful failure to follow in any material respect the lawful directions or policies of the Board after a written demand is delivered to Executive by the Board which specifically identifies the manner in which the Board believes Executive has failed to follow in any material respect the lawful directions or policies of the Board; or (v) the unauthorized absence of Executive from work (other than for sick leave or personal disability) for a period of 60 working days or more during a period of 90 working days.  For purposes of this provision, no act or failure to act on the part of Executive shall be considered “willful” unless it is done or omitted to be done by Executive in bad faith or without reasonable belief that Executive’s action or omission was in the best interests of the Company.  Any act or failure to act based upon authority given pursuant to a resolution duly adopted by the Board (or any committee of the Board) or in reliance on the legal advice of counsel for the Company shall be conclusively presumed to be done or omitted to be done by Executive in good faith and in the best interests of the Company.  The cessation of employment of Executive shall not be deemed to be for Cause unless and until there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board at a meeting of the Board called and held for such purpose finding that, in the good faith opinion of the Board, an event constituting Cause has occurred.

 

(e)                                  Termination for Good Reason.  Executive may terminate his employment hereunder at any time for Good Reason (defined below) by giving written notice to the Company stating the basis for such termination, effective immediately upon giving such notice; provided, however, that no termination shall be for Good Reason until Executive has provided the Company with written notice of the conduct alleged to have caused Good Reason within ninety (90) days of his knowledge of such conduct and at least thirty (30) days have elapsed after the Company’s receipt of such written notice from Executive, during which the Company has failed to cure any such alleged conduct.  “Good Reason” shall mean any of the following: (i) a material reduction in Executive’s status, title, position or responsibilities; (ii) a reduction in Executive’s Annual Salary

 

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below the then current amount; (iii) the failure to receive an annual equity grant in accordance with Section 4(d); (iv) any material breach by the Company of this Agreement; (v) any purported termination of Executive’s employment for Cause which does not comply with the terms of this Agreement; (vi) a mandatory relocation of Executive’s employment with the Company more than fifty (50) miles from the office of the Company where Executive is principally employed and stationed as of the date hereof, except for travel reasonably required in the performance of Executive’s duties and responsibilities or (vii) the Board’s failure to nominate Executive for election to the Board at such times as his membership on the Board comes up for re-election, unless the Board determines in good faith as set forth in a resolution duly adopted by the Board upon a recommendation made to the Board by the Nominating and Corporate Governance Committee of the Board that is based on guidance from Institutional Shareholder Services (or a similar nationally recognized organization) that it is generally considered poor corporate governance practice for the Chief Executive Officer to serve on a Company’s board of directors.

 

(f)                                   Voluntary Termination by Executive.  Executive may at any time terminate his employment hereunder upon delivering sixty (60) days written notice to the Company.

 

(g)                                  Termination Date.   Except as provided in Section 23, any date on which Executive’s employment terminates hereunder shall be treated as the “Termination Date.”

 

7.                                      Payments Upon Termination and Other Actions.

 

(a)                                 Termination Due to Executive’s Death.  If Executive’s employment hereunder is terminated because of death, then the Company shall pay to Executive’s estate (or his designated beneficiaries):

 

(i)                                     a lump sum payment in cash equal to (A) Executive’s Annual Salary earned through the date of Executive’s death, (B) any accrued vacation pay earned by Executive, (C) any Bonus earned for the fiscal year ending prior to such death which has not yet been paid to the Executive and (D) any unreimbursed business expenses of Executive, in each case, to the extent not theretofore paid, and such payment shall be paid within 30 days after the date of Executive’s death except in the case of the Bonus which shall be paid on the April 15th immediately following the end of the fiscal year bonus period to which such Bonus relates; and

 

(ii)                                  a lump sum payment in cash equal to the number of days in the Company’s fiscal year up to and including the date of Executive’s death divided by the total number of days in the Company’s fiscal year multiplied by Executive’s Bonus earned for the Company’s fiscal year ending contemporaneously with or immediately following the date of Executive’s death as reasonably determined by the Board or a committee thereof after the end of the Company’s fiscal year in which such death occurs in accordance with the Board’s determination policies then in effect; such payment shall be paid on the April 15th immediately following the end of the Company’s fiscal year bonus period to which such Bonus relates.

 

In addition, all options to acquire securities of the Company held by Executive immediately prior to the Termination Date that would have vested if Executive’s employment continued for two years after the Termination Date shall become fully exercisable and shall remain exercisable for the period to end upon the earlier of the stated term of such option or one year following the date of the Executive’s death, notwithstanding the terms of the relevant stock option agreements (provided, that, if such agreements provide for a longer exercise period, such longer period shall

 

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apply) and regardless of whether or not the vesting conditions set forth in the relevant stock option agreements have been satisfied in full, and all restrictions on any time-vesting restricted stock or deferred stock units of the Company held by Executive immediately prior to the Termination Date that would have lapsed if Executive’s employment continued for two years after the Termination Date shall be removed, notwithstanding the terms of the relevant restricted stock or deferred stock units agreements and regardless of whether the vesting conditions set forth in the relevant restricted stock or deferred stock units agreements have been satisfied in full.  As a matter of clarification and for the avoidance of doubt, it is the intention and agreement of the parties that the foregoing provisions of this Section 7(a) relating to the vesting and period of exercise of stock options, and  the vesting of, or lapsing of restrictions on, restricted stock units, deferred stock units and performance units shall apply to stock options, restricted stock units, deferred stock units and performance units granted or issued to the Executive at any time prior to  the Effective Date and those granted or issued to him at any time after the Effective Date during the term of his employment under this Agreement and are intended  to amend and do amend the terms of the underlying stock option, restricted stock unit, deferred stock unit and performance unit agreements to the extent necessary to carry out the intent of this Section 7(a).  In addition, on the date on which any performance units (or performance-based deferred stock units) held by Executive immediately prior to the Termination Date would have vested had Executive remained employed in accordance with the respective terms of the relevant performance unit agreement, all restrictions shall be removed on a number of shares of common stock of the Company (“Common Stock”) equal to the number of shares calculated in accordance with the vesting provisions of any such performance unit agreement times the quotient determined by dividing (x) the number of days from the grant date through the Termination Date by (y) the number of days in the applicable performance period, notwithstanding the terms of the relevant performance unit agreement.  Executive’s estate or designated beneficiaries shall also be entitled to any other benefits which may be owing in accordance with the Company’s plans and policies and such amounts shall be paid in accordance with such plans and policies (the “Executive Benefits”).

 

(b)                                 Termination Due to Executive’s Permanent Disability.  If Executive’s employment hereunder is terminated because Executive becomes Permanently Disabled, then the Company shall pay to Executive:

 

(i)                                     a lump sum payment in cash equal to (A) Executive’s Annual Salary earned through the date of Executive’s termination of Employment (the “Termination Date”), (B) any accrued vacation pay earned by Executive, (C) any Bonus earned for the fiscal year ending prior to the Termination Date which has not yet been paid to the Executive and (D) any unreimbursed business expenses of Executive, in each case, to the extent not theretofore paid (the “Accrued Obligations”), and such payment shall be paid within 30 days after the Termination Date except in the case of the Bonus which shall be paid on the April 15th immediately following the end of the fiscal year bonus period to which such Bonus relates, and such payment shall be paid within 30 days after the Termination Date except in the case of the Bonus which shall be paid on the April 15th immediately following the fiscal year bonus period to which such Bonus relates; and

 

(ii)                                  a lump sum payment in cash equal to the number of days in the Company’s fiscal year up to and including the Termination Date divided by the total number of days in the Company’s fiscal year multiplied by Executive’s Bonus earned for the Company’s fiscal year ending contemporaneously with or immediately following the Termination Date as

 

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reasonably determined by the Board or a committee thereof after the end of the Company’s fiscal year in which such termination occurs in accordance with the Board’s determination policies then in effect; such payment shall be paid on the April 15th immediately following the end of the Company’s fiscal year bonus period to which such Bonus relates.

 

In addition, all options to acquire securities of the Company held by Executive immediately prior to the Termination Date that would have vested if Executive’s employment continued for two years after the Termination Date shall become fully exercisable and shall remain exercisable for the period to end upon the earlier of the stated term of such option or one year following the Termination Date, notwithstanding the terms of the relevant stock option agreements (provided, that, if such agreements provide for a longer exercise period, such longer period shall apply)  and regardless of whether or not the vesting conditions set forth in the relevant stock option agreements have been satisfied in full, and all restrictions on any time-vesting restricted stock or deferred stock units of the Company held by Executive immediately prior to Termination Date that would have lapsed if Executive’s employment continued for two years after the Termination Date shall be removed, notwithstanding the terms of the relevant restricted stock or deferred stock units agreements and regardless of whether the conditions set forth in the relevant restricted stock or deferred stock units agreements have been satisfied in full.  As a matter of clarification and for the avoidance of doubt, it is the intention and agreement of the parties that the foregoing provisions of this Section 7(b) relating to the vesting and period of exercise of stock options, and the vesting of, or lapsing of restrictions on, restricted stock units, deferred stock units and performance units shall apply to stock options, restricted stock units, deferred stock units and performance units granted or issued to the Executive at any time prior to the Effective Date and those granted or issued to him at any time after the Effective Date during the term of his employment under this Agreement and are intended to amend and do amend the terms of the underlying stock option, restricted stock unit, deferred stock unit and performance unit agreements to the extent necessary to carry out the intent of this Section 7(b).  In addition, on the date on which any performance units (or performance-based deferred stock units) held by Executive immediately prior to the Termination Date would have vested had Executive remained employed in accordance with the respective terms of the relevant performance unit agreement, all restrictions shall be removed on a number of shares of Common Stock equal to the number of shares calculated in accordance with the vesting provisions of any such performance unit agreement times the quotient determined by dividing (x) the number of days from the grant date through the Termination Date by (y) the number of days in the applicable performance period, notwithstanding the terms of the relevant performance unit agreement.  Executive shall also be entitled to the Executive Benefits.

 

(c)                                  Termination By Company Without Cause, by the Company’s Non-Renewal or by Executive For Good Reason.  If Executive’s employment hereunder is terminated by the Company at any time during the Employment Period without Cause pursuant to Section 6(c) hereof, by the Company by its election not to renew this Agreement pursuant to Section 2 hereof or by Executive at any time during the Employment Period for Good Reason pursuant to Section 6(e) hereof, then the Company shall pay to Executive:

 

(i)                                     a lump sum payment in cash equal to the Accrued Obligation and such payment shall be paid within 30 days after the Termination Date except in the case of the Bonus which shall be paid on the April 15th immediately following the fiscal year bonus period to which such Bonus relates;

 

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(ii)                                  his Annual Salary through the two year anniversary of the Termination Date (the “Base Salary Severance”), and such amount will be paid by the Company in equal installments following the Termination Date in accordance with the customary payroll practices of the Company as if Executive was employed at the time, commencing on the first Company payroll date immediately following the 38th day after the Termination Date (the “First Payment Date”),  and any installment of the Base Salary Severance that would have otherwise been paid pursuant to the customary payroll practices of the Company prior to the First Payment Date shall instead be accumulated and paid on the First Payment Date;

 

(iii)                               a lump sum payment in cash equal to the number of days in the Company’s fiscal year up to and including the Termination Date divided by the total number of days in the Company’s fiscal year multiplied by Executive’s Bonus earned for the Company’s fiscal year ending contemporaneously with or immediately following the Termination Date as reasonably determined by the Board or a committee thereof after the end of the Company’s fiscal year in which such termination occurs in accordance with the Board’s determination policies then in effect; such payment shall be paid on the April 15th immediately following the end of the Company’s fiscal year bonus period to which such Bonus relates; and

 

(iv)                              in addition to the payment pursuant to Section 7(c)(ii), installment payments in cash equal to two times the Target Bonus for the year in which the Termination Date occurs (the “Target Bonus Severance”), also to be paid by the Company in equal installments in accordance with the customary payroll practices of the Company contemporaneously with the payments to be made in accordance with Section 7(c)(ii) hereof pursuant to the same payment schedule and procedure as provided for the Base Salary Severance.

 

In addition, all options to acquire securities of the Company held by Executive immediately prior to the Termination Date that would have vested if Executive’s employment continued for two years after the Termination Date shall continue to vest over such two year period in accordance with the terms of the relevant stock option agreements, notwithstanding the terms of the relevant stock option agreements and regardless of whether or not the vesting conditions set forth in the relevant stock option agreements have been satisfied in full and shall remain exercisable for the period to end upon the earlier of the stated term of such option or the third anniversary of the Termination Date (provided, that, if such agreements provide for a longer exercise period, such longer period shall apply), and all restrictions on any time-vesting restricted stock or deferred stock units of the Company held by Executive immediately prior to Termination Date that would have lapsed if Executive’s employment continued for two years after the Termination Date shall continue to lapse over such two year period in accordance with the terms of the relevant restricted stock or deferred vesting restricted stock unit agreements, notwithstanding the terms of the relevant restricted stock or deferred stock units agreements (including any requirements for continued employment) and regardless of whether the conditions set forth in the relevant restricted stock or deferred stock units agreements have been satisfied in full.  As a matter of clarification and for the avoidance of doubt, it is the intention and agreement of the parties that the foregoing provisions of this Section 7(c) relating to the vesting and period of exercise of stock options, and the vesting of, or lapsing of restrictions on, restricted stock units and deferred stock units shall apply to stock options, restricted stock units and deferred stock units granted or issued to the Executive at any time prior to the Effective Date and those granted or issued to him at any time after the Effective Date during the term of his employment under this Agreement and are intended to amend and do amend the terms of the underlying stock option, restricted stock unit and deferred stock unit agreements to the extent

 

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necessary to carry out the intent of this Section 7(c).  Restrictions on any performance units (or performance-based deferred stock units) shall lapse, if at all, in accordance with the terms of the relevant performance unit agreement and nothing herein shall be deemed to modify the terms of such performance unit agreements.  Executive shall also be entitled to the Executive Benefits.   Further, the Company agrees that, if Executive’s employment with the Company terminates such that he is entitled to receive the payment and benefits set forth in this Section 7(c), Executive is not required to seek other employment or otherwise attempt in any way to mitigate or otherwise reduce any benefits or amounts payable to Executive by the Company pursuant to this Section 7(c) and, subject to the provisions of Section 7(e) hereof, in the event that Executive obtains other employment during the period in which he is receiving benefits under this Section 7(c), the Company shall not be entitled to any rights of offset with respect to the benefits or amounts payable to Executive under this Section 7(c).

 

(d)                                 Termination With Cause, or By Executive without Good Reason or by Notice of Non-Renewal.  If Executive’s employment hereunder is terminated by the Company with Cause pursuant to Section 6(d) hereof or by Executive without Good Reason pursuant to Section 6(f) hereof or non-renewal of this Agreement by Executive pursuant to Section 2 hereof, then except for a lump sum payment in cash equal to the Accrued Obligation, which payment shall be paid within 30 days after the Termination Date, and the Executive Benefits, Executive shall not be entitled to receive severance or any other compensation or benefits after the Termination Date.

 

(e)                                  Continuation of Medical Benefits.  In the event of a termination of Executive’s employment described in Section 7(a), (b) or (c), the Company shall arrange to provide Executive and his spouse and eligible dependents who were covered under the Company’s group health plan on the Termination Date and who in the case of eligible dependents continue to be eligible dependents, group health plan coverage for a period following the Termination Date (except as provided below) until the Executive reaches age 65, or in the case of a termination described in Section 7(a), until the Executive’s spouse reaches age 65, which coverage is substantially similar to that provided to executive officers of the Company during such period and at a cost to Executive, or to his spouse if the Executive is deceased, as if the Executive had remained an executive officer of the Company during such period.  Executive shall pay the full cost of the premiums for such coverage, as determined and set under the then current practices of the Company, on the first day of each month such coverage is provided and the Company shall reimburse Executive the excess, if any, of the amount Executive pays to the Company above the amount of the applicable premium that Executive would have paid for comparable coverage if he had remained an executive officer of the Company during the period such coverage is provided (the “Reimbursement Amounts”).  Any Reimbursement Amounts to be paid  by the Company to Executive under this Section 7(e) shall be made on the tenth day of each month Executive pays the amount required by this Section 7(e) to the Company commencing on the first such date immediately following the 38th day after the Termination Date (the “First Reimbursement Date”), and any installment of the Reimbursement Amount that would have otherwise been paid prior to the First Reimbursement Date shall instead be accumulated and paid on the First Reimbursement Date.  Subject to Executive’s group health plan coverage continuation rights under section 4980B of the Code, the benefits  described in this Section 7(e) shall (i) be reduced (on a participant by participant basis) to the extent benefits of the same type are received by Executive, his spouse or any eligible dependent from any other person during such period and (ii) cease if Executive (A) obtains other employment that offers participation in a health insurance plan providing substantially similar benefits during such period or (B) violates Section 9(a) of this Agreement,

 

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and provided, further, that Executive shall have the obligation to notify the Company that he or they are receiving such benefits.  The Company agrees that, if Executive’s employment with the Company terminates during the term of this Agreement, Executive is not required to seek other employment or to attempt in any way to reduce any benefits or amounts payable to Executive by the Company pursuant to this Section 7(e).

 

(f)                                   Release.  Except as provided below, as a condition to the receipt of any amounts or benefits after termination of employment for whatever reason, Executive, or his personal representative, shall be required to execute a written release agreement in the form attached hereto as Exhibit A containing, among other things, a general release of claims against the Company and its affiliates except for rights and claims hereunder and pursuant to the terms of any Executive benefit plans, equity grants or other similar plans or agreements or pursuant to the Change in Control Plan and, as an additional condition to the receipt of such amounts or benefits, Executive shall refuse to exercise any right to revoke such release agreement during any applicable rescission period.  Executive, or his personal representative, shall deliver the executed release on or before the date that is 30 days (90 days in the event of Executive’s death) after any Termination Date or Executive shall forfeit all rights to the payments set forth in Section 7 other than the payments set forth in Section 7(a)(i) (excluding the bonus amounts referred to in subsection (C) thereof) or the Accrued Obligations (excluding the bonus amounts referred to in subsection (C) of the definition of Accrued Obligations).

 

(g)                                  Board and Office Resignations.  Upon termination of Executive’s employment for any reason, unless otherwise requested in writing by the Board, Executive agrees to resign, as of the date of such termination and to the extent applicable, as an officer of the Company and its subsidiaries and as a director on each board of directors or other managing body of the Company and its subsidiaries, and from any committees thereof.  In order to facilitate the terms of this Section 7(g), Executive shall provide an executed form of resignation letter in the form attached hereto as Exhibit B to the Company pursuant to which he resigns his position as a director and officer of the Company and each of its subsidiaries to be held in escrow by the Company and upon a termination event under the terms of this Agreement such resignation shall be presented to the Board for consideration and acceptance if determined by the Board to be in the best interest of the Company and its shareholders.

 

8.                                      Exclusivity of Termination Provisions.  Except as and to the extent provided in the Change in Control Plan and any award agreements related to the issuance of performance units or performance-based deferred stock units, the termination provisions of this Agreement regarding the parties’ respective obligations in the event that Executive’s employment is terminated are intended to be exclusive and in lieu of any other rights or remedies to which Executive or the Company may otherwise be entitled at law, in equity or otherwise.

 

9.                                      Restrictive Covenants.

 

(a)                                 Non-Competition.  Executive acknowledges that he has and, while employed, will acquire unique and valuable experience with respect to the businesses, operations, plans and strategies of the Company and its subsidiaries.  Executive hereby covenants and agrees that during the term of this Agreement and any period thereafter during which he is receiving payments pursuant to Subsections 7(b)(i)-(ii) and 7(c)(i)-(iv) hereof (but, in no event longer than two (2) years following Executive’s termination of employment), he will not directly or indirectly compete with the business of the Company or its subsidiaries.  For purposes of this Agreement,

 

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the term “compete with the business of the Company and its subsidiaries” shall include Executive’s participation in any operations whose primary business competes with any business now conducted by the Company or its subsidiaries, including the sale or rental of menswear (including formalwear), men’s accessories or men’s shoes at retail, the sale or rental of occupational uniforms or other corporate wear merchandise, dry cleaning, or any material line of business proposed to be conducted by the Company or one or more of its subsidiaries known to Executive and with respect to which Executive devoted time as part of his employment hereunder on behalf of the Company or one or more of its subsidiaries, whether such participation is individually or as an officer, director, joint venturer, agent or holder of an interest (except as a holder of a less than 1% interest in a publicly traded entity or mutual fund) of any individual, corporation, association, partnership, joint venture or other business entity so engaged; provided, however, that passive interests held by Executive in private companies through hedge funds and private equity investments shall not violate this Section 9(a) so long as Executive does not have any involvement with respect to any companies which could reasonably be considered to be a competitor of the Company or any of its subsidiaries (a “Competitor”), including consultation with the private equity firm, the hedge fund or any of the principals thereof, with respect to making an investment into a Competitor.  This non-competition covenant shall be applicable with respect to the United States, Canada, the United Kingdom and any other country in which Executive would be competing with the business of the Company or its subsidiaries as set forth in this Section 9(a).  For the avoidance of doubt, Executive shall not violate this Section 9(a) by providing services to a unit, division or subsidiary of an entity where such entity or a subsidiary thereof, other than a subsidiary to which Executive is providing services, competes with a business of the Company or its subsidiaries so long as Executive does not directly or indirectly provide services to the unit, division or subsidiary of the entity which competes with any business of the Company or one or more of its subsidiaries and does not provide services to the entity or to any subsidiary thereof that does not complete with any business of the Company where such services relate to, or benefit, any unit, division or subsidiary that so competes.

 

(b)                                 Non-Solicitation.  During the Employment Period and for any period during which he is receiving payments or benefits pursuant to Subsection 7(b)(i)-(ii) and 7(c)(i)-(iv)  hereof (but, in no event longer than two (2) years following Executive’s termination of employment), Executive shall not directly or indirectly cause, solicit, induce or encourage any individual identified by the Company as an executive of the Company or its subsidiaries to terminate his/her employment with the Company or such subsidiary.

 

(c)                                  Non-Disparagement.  Executive agrees not to engage at any time in any form of conduct or make any statements, or direct any other person or entity to engage in conduct or make any statements, that disparage, criticize or otherwise impair the reputation of the Company, its affiliates, and their respective past and present officers, directors and, in their capacities as such, shareholders, partners, members and agents.  The Company agrees not to engage at any time in any form of conduct or make any statements or direct any person or entity to engage in conduct or make any statements, that disparage, criticize or otherwise impair the reputation of the Executive and following Executive’s Termination Date, the Company shall instruct its executive officers and member of the Board not to engage at any time in any form of conduct or make any statements or direct any person or entity to engage in conduct or make any statements, that disparage, criticize or otherwise impair the reputation of the Executive.  Nothing contained in this Section 9(c) shall preclude Executive or the Company from providing truthful testimony or statements pursuant to subpoena or other legal process or in response to inquiries

 

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from any government agency or entity, or as required to comply with applicable securities laws, or from taking any action that is proper and necessary in the discharge of obligations to, or of, the Company, including the discharge by Executive of his duties and responsibilities contemplated by this Agreement, or in the discharge of requirements of law.

 

(d)                                 Proprietary Information.  Executive acknowledges and agrees that he has acquired, and may in the future acquire as a result of his employment with the Company or otherwise, Proprietary Information (as defined below) of the Company, which is of a confidential or trade secret nature, and all of which has a great value to the Company and is a substantial basis and foundation upon which the Company’s business is predicated.  Accordingly, Executive agrees to regard and preserve as confidential at all times all Proprietary Information and to refrain from publishing or disclosing any part of it to any person or entity and from using, copying or duplicating it in any way by any means whatsoever, except in the course of his employment under this Agreement and in furtherance of the business of the Company, including in the discharge of obligations to, or of, the Company, including the discharge of his duties and responsibilities contemplated by this Agreement, or as required by applicable law or legal process, without the prior written consent of the Company.  “Proprietary Information” includes all information and data in whatever form, tangible or intangible, pertaining in any manner to pricing policy, marketing programs, advertising, Executive training and specific inventory purchase pricing and any written information, including customer lists, of the Company or any affiliate thereof, unless the information is or becomes publicly known through lawful means. Nothing contained in this Section 9(d) shall preclude Executive from providing truthful testimony or statements or from disclosing Proprietary Information pursuant to subpoena or other legal process or in response to inquiries from any government agency or entity; provided, however, that in the event that Executive receives notice from any person, or in good faith determines, that Executive may become legally compelled to disclose any of the Company’s Proprietary Information, Executive will, to the extent legally permitted,  as soon as reasonably practicable  supply the Company with written notice thereof and Executive to the fullest extent he is legally permitted to do so, shall not disclose any such Proprietary Information until the Company has had an opportunity to seek a protective order or other arrangement to prevent the disclosure of the Proprietary Information and Executive will reasonably cooperate with the Company in obtaining such a protective order or other arrangement at the Company’s sole expense.

 

(e)                                  Remedy.  Executive and the Company agree that a monetary remedy for a breach of this Section 9 will be inadequate and will be impracticable and extremely difficult to prove, and further agree that such a breach would cause the Company irreparable harm, and that the Company shall be entitled to specific performance and/or temporary and permanent injunctive relief without the necessity of proving actual damages.  Executive agrees that the Company shall be entitled to such specific performance and/or injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bond or other undertaking in connection therewith.  Any such requirement of bond or undertaking is hereby waived by Executive and Executive acknowledges that in the absence of such a waiver, a bond or undertaking may be required by the court.  In the event of litigation to enforce any of these covenants, the courts are hereby specifically authorized to reform such covenant as and to the extent, but only to such extent, necessary in order to give full force and effect hereto to the maximum degree permitted by law.  Executive also agrees that if Executive is in breach of this Section 9, the Company shall cease all payments and other benefits payable under this Agreement.

 

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10.                               Forfeiture for Cause.

 

(a)                                 Notwithstanding any other provision of this Agreement, if a determination is made as provided in Section 10(b) (a “Forfeiture Determination”) that (a) Executive, before or after the termination of Executive’s employment with the Company and all affiliates, (i) committed fraud, embezzlement, theft, felony or an act of dishonesty (as defined below) in the course of his employment by the Company or an affiliate, (ii) knowingly caused or assisted in causing the Company or a subsidiary of the Company to engage in criminal misconduct, (iii) knew or should have known in the reasonable exercise of his duties that the Company was publicly releasing financial statements of the Company that were materially misstated and misleading, (iv) intentionally, or as a result of his gross negligence, disclosed trade secrets of the Company or an affiliate or (v) intentionally, or as a result of his gross negligence, violated the terms of any non-competition, non-disclosure or similar agreement with respect to the Company or any affiliate to which Executive is a party; and (b) in the case of the actions described in clauses (iv) and (v) and with respect to acts of dishonesty in clause (i), such action materially and adversely affected the Company, then at or after the time such Forfeiture Determination is made the Board, in good faith, if such Forfeiture Determination is made prior to a Change in Control (as defined in the Change in Control Plan), or, as determined by a final, non-appealable order of a court of competent jurisdiction, if such Forfeiture Determination is made after a Change in Control as a fair and equitable forfeiture to reflect the harm done to the Company and a reduction of the benefit bestowed on Executive had the facts existing at the time the benefit was bestowed that led to the Forfeiture Determination been known to the Company at the time the benefit was bestowed, may determine that some or all (x) benefits payable or to be provided, or previously paid or provided, under this Agreement to Executive, (y) cash bonuses paid on or after the effective date of this Agreement by the Company to Executive under any plan, program, policy, practice, contract or agreement of the Company or (z) equity awards granted to Executive under any plan, program, policy, practice, contract or agreement of the Company that vested on or after the effective date of this Agreement, will be forfeited to the Company on such terms as determined by the Board or the final, non-appealable order of a court of competent jurisdiction.  For purposes of this Section 10, an “act of dishonesty” shall require a material breach by Executive of his duties, obligations or undertakings owed to or on behalf of the Company, as determined by the Board.  In determining whether a matter materially and adversely affects the Company, the Board shall be entitled to consider all relevant factors and exercise reasonable business judgment in making such determination, including but not limited to the financial consequences, adverse reputational consequences or legal consequences to the Company and/or its subsidiaries, individually or taken as a whole, as a result of such action.

 

(b)                                 A Forfeiture Determination for purposes of Section 10 shall be made (i) before the occurrence of a Change in Control, by a majority vote of the Board and (ii) on or after the occurrence of a Change in Control, by the final, nonappealable order of a court of competent jurisdiction.  The findings and decision of the Board with respect to a Forfeiture Determination made before the occurrence of a Change in Control, including those regarding the acts of Executive and the damage done to the Company, will be final for all purposes absent a showing by clear and convincing evidence of manifest error by, or a lack of good faith on the part of, the Board; provided, that, any disagreements as to whether the Board lacked good faith or its decision resulted from manifest error shall be subject to resolution in accordance with Section 16 hereof.

 

13

 

11.                               Notice.  All notices, requests, consents, directions and other instruments and communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if delivered in person, by courier, by overnight delivery service with proof of delivery or by prepaid registered or certified first-class mail, return receipt requested, addressed to the respective party at the address set forth below, or if sent by facsimile or other similar form of communication (with receipt confirmed) to the respective party at the facsimile number set forth below:

 

	
To the Company:
    	
The Men’s   Wearhouse, Inc.
    
	
 
    	
6100 Stevenson Blvd
    
	
 
    	
Fremont, CA 94538
    
	
 
    	
Attention: Andrew   Iwaskow
    
	
 
    	
Facsimile:
    
	
 
    	
Confirm:
    
	
 
    	
 
    
	
To Executive:
    	
Douglas E. Ewert
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Facsimile:
    
	
 
    	
Confirm:
    

 

or to such other address or facsimile number and to the attention of such other person as either party may designate by written notice.  All notices and other communication shall be deemed to have been duly given when delivered personally or three days after mailing or one day after depositing such notice with an overnight courier or transmission of a facsimile or other similar form of communication.

 

12.                               Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties hereto, their respective heirs, executors, administrators, successors and assigns; provided, however, that neither the Company nor Executive may assign any duties under this Agreement without the prior written consent of the other party.

 

13.                               Limitation.  The Agreement shall not confer any right or impose any obligation on the Company to continue the employment of Executive in any capacity, or limit the right of the Company or Executive to terminate Executive’s employment.

 

14.                               Further Assurances.  Each party hereto agrees to perform such further actions, and to execute and deliver such additional documents, as may be reasonably necessary to carry out the provisions of this Agreement.

 

15.                               Severability.  In the event that any of the provisions, or portions thereof, of this Agreement are held to be unenforceable or invalid by any court of competent jurisdiction, the validity and enforceability or the remaining provisions, or portions thereof, shall not be affected thereby.

 

16.                               Arbitration.

 

(a)                                 Any dispute, controversy, or claim arising out of or relating to this Agreement, or the breach, termination or invalidity hereof, including claims for tortious

 

14

 

interference or other tortious or statutory claims arising before, during or after termination, providing only that such claim touches upon matters covered by this Agreement, shall be finally settled by arbitration administered by the American Arbitration Association (“AAA”) pursuant to the Commercial Arbitration Rules as presently in force, except as modified by the specific provisions of this Agreement.  The parties expressly agree that nothing in this Agreement shall prevent the parties from applying to a court that would otherwise have jurisdiction over the parties for provisional or interim measures, including injunctive relief.  After the arbitration panel is empaneled, it shall have sole jurisdiction to hear such applications, except that the parties agree that any measures ordered by the arbitrators may be immediately and specifically enforced by a court otherwise having jurisdiction over the parties.  The parties agree that judgment on the arbitration award may be entered by any court having jurisdiction thereof.

 

(b)                                 The parties agree that the federal and state courts located in Houston, Texas shall have exclusive jurisdiction over an action brought to enforce the rights and obligations created in or arising from this Agreement to arbitrate, and each of the parties hereto irrevocably submits to the jurisdiction of said courts.  Notwithstanding the above, application may be made by a party to any court of competent jurisdiction wherever situated for enforcement of any judgment and the entry of whatever orders are necessary for such enforcement.  Process in any action arising out of or relating to this Agreement may be served on any party to the Agreement anywhere in the world by delivery in person against receipt or by registered or certified mail, return receipt requested.

 

(c)                                  The arbitration shall be conducted before a tribunal composed of three neutral arbitrators drawn from, in the first instance, the Texas Large Complex Claims panel and then, if necessary, from the Commercial panel.  Each arbitrator shall sign an oath agreeing to be bound by the Code of Ethics for Arbitrators in Commercial Disputes promulgated by the AAA for Neutral Arbitrators.  It is the intent of the parties to avoid the appearance of impropriety due to bias or partiality on the part of any arbitrator.  Prior to his or her formal appointment, each arbitrator shall disclose to the parties and to the other members of the tribunal, any financial, fiduciary, kinship or other relationship between that arbitrator and any party or its counsel, or between that arbitrator and any individual or entity with any financial, fiduciary, kinship or other relationship with any party.  For the purposes of this Agreement, “appearance of impropriety” shall be defined as such relationship or behavior as would cause a reasonable person to believe that bias or partiality on the part of the arbitrator may exist in favor of any party.  Any award or portion thereof, whether preliminary or final, shall be in a written opinion containing findings of fact and conclusions of law signed by each arbitrator.  The arbitrator dissenting from an award or portion thereof shall issue a dissent from the award or portion thereof in writing, stating the reasons for his or her dissent.  The arbitrators shall hear and determine any preliminary issue of law asserted by a party to be dispositive of any claim, in whole or part, in the manner of a court hearing a motion to dismiss for failure to state a claim or for summary judgment, pursuant to such terms and procedures as the arbitrators deem appropriate.

 

(d)                                 It is the intent of the parties that, barring extraordinary circumstances, any arbitration hearing shall be concluded within two months of the date the statement of claim is received by the AAA.  Unless the parties otherwise agree, once commenced, hearings shall be held 5 days a week, with each hearing day to begin at 9:00 A.M. and to conclude at 5:00 P.M.  The parties may upon agreement extend these time limits, or the chairman of the panel may extend them if he or she determines that the interests of justice otherwise require.  The arbitrators shall

 

15

 

use their best efforts to issue the final award or awards within a period of 30 days after closure of the proceedings.  Failure to do so shall not be a basis for challenging the award.  The parties and arbitrators shall treat all aspects of the arbitration proceedings, including without limitation, discovery, testimony and other evidence, briefs and the award, as strictly confidential.  The place of arbitration shall be Houston, Texas, U.S.A. unless otherwise agreed by the parties.

 

(e)                                  The parties agree that discovery shall be limited and shall be handled expeditiously.  Discovery procedures available in litigation before the courts shall not apply in an arbitration conducted pursuant to this Agreement.  However, each party shall produce relevant and non-privileged documents or copies thereof requested by the other parties within the time limits set and to the extent required by order of the arbitrators.  All disputes regarding discovery shall be promptly resolved by the arbitrators.  No witness or party may be required to waive any privilege recognized at law.  The parties hereby waive any claim to any damages in the nature of punitive, exemplary or statutory damages in excess of compensatory damages, or any form of damages in excess of compensatory damages, and the arbitration tribunal is specially divested of any power to award any damages in the nature of punitive, exemplary or statutory damages in excess of compensatory damages, or any form of damages in excess of compensatory damages.   If Executive prevails on substantially all of his material claims, he shall be entitled to recover his costs, including attorneys’ fees, for the arbitration proceedings, as well as for any ancillary proceeding, including a proceeding to compel arbitration, to request interim measures or to confirm or set aside an award; provided, however, that in the event that Executive does not so prevail, the parties shall bear their own costs.

 

17.                               Governing Law.  This Agreement shall be governed and construed under and interpreted in accordance with the laws of the State of Texas without giving effect to the doctrine of conflict of laws.

 

18.                               Entire Agreement; Waiver; Interpretation. This Agreement constitutes the entire agreement of the parties, and supersede all prior agreements, oral or written, with respect to the subject matter of this Agreement; provided, that the Change in Control Plan and any award agreement, except in the case of any award agreement as expressly provided in Section 7 hereof, shall not be superseded hereby.  No change, modification or waiver of any provisions of this Agreement shall be enforceable unless contained in a writing signed by the party against whom enforcement is sought.  The failure at any time to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of either party thereafter to enforce each and every provision hereof in accordance with its terms.  No presumption shall be construed against the party drafting this Agreement.

 

19.                               Executive’s Representation.  Executive represents and warrants that (i) he is free to enter into this Agreement and to perform each of the terms and covenants of it, (ii) he is not restricted or prohibited, contractually or otherwise, from entering into and performing this Agreement, (iii) his execution and performance of this Agreement is not a violation or breach of any other agreement between Executive and any other person or entity and (iv) he has been advised by legal counsel as to the terms and provisions hereof and the effort thereof and fully understands the consequences thereof.

 

20.                               Company’s Representation.  The Company represents and warrants that (i) it is free to enter into this Agreement and to perform each of the terms and covenants of it, (ii) it is not restricted or prohibited, contractually or otherwise, from entering into and performing this

 

16

 

Agreement, (iii) its execution and performance of this Agreement is not a violation or breach of any other agreement between Executive and any other person or entity and (iv) this Agreement is a legal, valid and binding agreement of the Company, enforceable in accordance with its terms.

 

21.                               Return of Company Property.  Executive acknowledges that all Proprietary Information and other property and equipment of the Company or any affiliate that Executive accumulates during his employment are the property of the Company and shall be returned to the Company immediately upon the termination of his employment; provided, however, that Executive may retain a copy of any Company property that relates solely to his personal information, including Executive’s compensation, taxes and his personal contact list, calendar and diaries.

 

22.                               Miscellaneous.  All references to sections of any statute shall be deemed also to refer to any successor provisions to such sections.  The compensation and benefits payable to Executive or his beneficiary under Section 7 of this Agreement shall be in lieu of any other severance benefits to which Executive may otherwise be entitled upon the termination of his employment under any severance plan, program, policy or arrangement of the Company other than the Change in Control Plan, and Executive shall not be entitled to receive any additional payments or benefits under Section 7 hereof if he has become eligible to receive substantially identical payments or benefits under the Change in Control Plan.  Executive shall not be permitted to specify the taxable year in which a payment provided for under this Agreement shall be made to him.

 

23.                               Compliance With Section 409A.  The Company and Executive intend that any amounts or benefits payable or provided under this Agreement shall comply with section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and guidance promulgated thereunder (“Section 409A”) so as not to subject Executive to the payment of the tax, interest and any tax penalty which may be imposed under Section 409A.  The provisions of this Agreement shall be interpreted and administered in a manner that complies with Section 409A. The Company will not take any action or omit to take any action that would expose any payment or benefit to Executive to additional tax under Section 409A.  In furtherance thereof, to the extent that any provision hereof would otherwise result in Executive being subject to payment of tax, interest and tax penalty under Section 409A, the Company and Executive agree to negotiate reasonably and in good faith to amend this Agreement in a manner that brings this Agreement into compliance with Section 409A and preserves to the maximum extent possible economic value to the relevant payment or benefit under this Agreement to Executive. Each payment in a series of payments or installments hereunder shall be treated as a separate payment for purposes of Section 409A. To the extent that a reimbursement amount is subject to Section 409A, the Company will pay Executive the reimbursement amount due, if any, in any event before the last day of Executive’s taxable year following the taxable year in which the expense was incurred.  Executive’s rights to any reimbursements are not subject to liquidation or exchange for another benefit.  The amount of expense reimbursements for which Executive is eligible during any taxable year will not affect the amount of any expense reimbursements for which Executive is eligible in any other taxable year.  Notwithstanding anything contained herein to the contrary, (i) in no event shall the Termination Date occur until Executive experiences a “separation from service” within the meaning of Section 409A and the date upon which separation from service takes place shall be the “Termination Date” and (ii) in the event Executive is a “specified employee” (within the meaning of Section 409A) as of the date of his separation from service, amounts and benefits that are properly treatable as deferred compensation (within the meaning of Section 409A, and after

 

17

 

taking into account all exclusions applicable to such payment under Section 409A) that would otherwise be payable or provided  hereunder shall not be made prior to the first business day after the earlier of (x) the expiration of six months from the date of Executive’s separation from service for any reason other than death or (ii) the date of Executive’s death (such first business day, the “Delayed Payment Date”).  On the Delayed Payment Date, the Company shall pay to Executive or, if has died, to his estate, in a single cash lump sum, an amount equal to the aggregate amount of all payments delayed pursuant to the preceding sentence.

 

[Remainder of Page Intentionally Left Blank; Signatures on Following Page.]

 

18

 

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed effective as of the date first written above.

 

 

	
 
    	
TAILORED   BRANDS, INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Dinesh Lathi
    
	
 
    	
Name: Dinesh Lathi
    
	
 
    	
Title: Chairman of the   Board
    
	
 
    	
 
    
	
 
    	
Date:
    	
June 21, 2018
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
TAILORED SHARED   SERVICES, LLC
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Bruce K. Thorn
    
	
 
    	
Name: Bruce K. Thorn
    
	
 
    	
Title: President and   Chief Operating Officer
    
	
 
    	
 
    	
 
    
	
 
    	
Date:
    	
June 21, 2018
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ DOUGLAS S. EWERT
    
	
 
    	
DOUGLAS S. EWERT
    
	
 
    	
 
    
	
 
    	
Date:
    	
June 21, 2018
    
				

 

19

 

Exhibit A

 

Form of Release

 

[see attached]

 

20

 

RELEASE

 

Pursuant to the terms of that certain Second Amended and Restated Employment Agreement dated           , 20   , by and between Tailored Brands, Inc., a Texas corporation (the “Company”), Tailored Shared Services, LLC, a Delaware limited liability company, and Douglas S. Ewert (as the same may be amended through the date hereof, the “Employment Agreement”), I, Douglas S. Ewert, hereby acknowledge that my employment with the Company has been terminated effective             , 20  .   Defined terms used herein, but not otherwise defined, shall have the meanings attributed to such terms in the Employment Agreement.

 

I further acknowledge, understand and agree that:

 

1.                                      Release of all Claims.  In return for the amounts and benefits to be paid to me pursuant to the terms of the Employment Agreement, I hereby release the Company, its parent companies, subsidiaries, and affiliates and, in their capacities as such, all of their respective officers, directors, employees, insurers and agents from any and all claims, arising on or before the date of execution of this agreement, whether known or unknown, foreseen or unforeseen, asserted or unasserted, including but not limited to those claims asserted or that could have been asserted arising from or in any way related to my employment with and/or separation from the Company, and my release includes any claims I might have for re-employment or for additional compensation or benefits (except for unemployment compensation benefits), and applies to claims I might have under federal law, state law, contract or tort, including but not limited to applicable state civil rights laws, the California Fair Employment & Housing Act, Cal. Govt. Code § 12940 et. seq (“FEHA”), the California Family Rights Act, Title VII of the Civil Rights Act of 1964, as amended, the Post-Civil War Civil Rights Acts (42 U.S.C. Sections 1981-88), the Americans With Disabilities Act, the Rehabilitation Act of 1973, Executive Order 11246, the Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745, Family and Medical Leave Act, the Age Discrimination in Employment Act (29 U.S.C. Section 621 et seq. (“ADEA”), the Older Workers Benefit Protection Act, and any regulations under such laws.  I acknowledge that I am receiving consideration for my release of any claim under the ADEA in addition to anything of value to which I was already entitled.

 

2.                                      Exceptions.  Nothing in this Agreement is intended to waive rights and claims (i) under the Employment Agreement and/or the Change in Control Plan, if applicable, or  pursuant to the terms of any the Company executive benefit plan, equity grant or other similar plans or agreements, (ii) for unemployment or workers’ compensation benefits, (iii) for vested rights under ERISA-covered employee benefit plans as applicable on the date I sign this Agreement, (iv) that may arise after I sign this Agreement, (v) related to coverage under indemnification agreements or policies or under directors and officers insurance policies for acts or omissions while providing services to the Company or any of its affiliates or subsidiaries,  or (vi) which cannot be released by private agreement.  In addition, nothing in this Agreement or the Employment Agreement including but not limited to the release of claims, proprietary information, confidentiality of agreement, no conflicts of interest, no solicitation of employees, non-disclosure & confidential information, and non-disparagement provisions, prevent me from filing a charge or complaint with or from participating in an investigation or proceeding conducted by the EEOC, NLRB, or any other any federal, state or local agency charged with the enforcement of any laws, or from exercising rights under Section 7 of the NLRA to engage in joint activity with other employees,

 

21

 

although by signing this release I am waiving rights to individual relief based on claims asserted in such a charge or complaint, except where such a waiver of individual relief is prohibited.

 

3.                                      No Conflicts of Interest. I acknowledge and agree that I have continuing obligations beyond my separation from employment as expressed in this Agreement and the Employment Agreement.

 

4.                                      Return of Company Property.  Subject to the terms of Section 21 of the Employment Agreement, I understand and agree that I must immediately (but no later than my last day of employment) (a) return any Company property (including but not limited to computer equipment, iPhone, and/or cellular telephone and accessories, keys, American Express card, etc.); and (b) submit any outstanding expense reports and supporting receipts to the attention of           .

 

5.                                      No Right to Reemployment.  I understand and agree that I have no right to be rehired in the event another position becomes available in the future.

 

6.                                      Acknowledgements.  I acknowledge, agree and attest that I (a) have not been denied any leave or benefit requested; (b) have received the appropriate pay for all hours worked for the Company; (c) have no workplace injuries or occupational diseases; and (d) as of the date of this Agreement, I have been paid or received all leave (paid and unpaid), compensation, bonuses and or commission to which I claim to have been entitled to receive as of the date hereof, except as otherwise set forth in the Employment Agreement.

 

7.                                      Complete Agreement. I acknowledge that this agreement, together with the Employment Agreement and the Change in Control Plan, if applicable, contain the entire agreement between me and the Company regarding my employment and separation from employment.

 

8.                                      Representation by Counsel.  By signing below, I acknowledge having had an opportunity to have an attorney of choice review this Agreement and its release of claims. I also acknowledge that I have read all of this Agreement, been given at least 21 days to consider it and discuss it with financial and legal counsel of choice, and that I voluntarily sign it and agree to be bound by its terms.  I also understand and agree that this Agreement must be signed no later than           , 20   , [to be on or before 30 days after the date of Executive’s Separation from Service] in order for me to be entitled to the benefits given under it.  I understand that I may revoke the Agreement within 7 days after signing it, and unless I so revoke it, the Agreement will be fully effective upon expiration of the revocation period.  I understand and agree that to revoke this Agreement, written notice of the revocation must be received by the following person no later than seven (7) days from the date this Agreement is signed:

 

Andrew Iwaskow

Executive Vice President, Human Resources

Tailored Brands, Inc.

6100 Stevenson Boulevard

Fremont, CA 94538

Phone:

Facsimile:

 

22

 

9.                                      No Admissions.  The Company specifically denies any liability or wrongdoing whatsoever.  Neither this Separation Agreement nor any of its provisions, terms, or conditions shall be construed to be an admission of liability or wrongdoing.  Neither the Separation Agreement nor any of its provisions, terms, or conditions may be offered or received in evidence in any action or proceeding as evidence of an admission of liability or wrongdoing.

 

10.                               Additional Acknowledgments.

 

a.             I understand and agree that this Agreement constitutes a waiver and release of any and all claims which would otherwise be preserved by operation of Section 1542 of the Civil Code of the State of California, and under any and all similar laws of any governmental entity.  Section 1542 of the Civil Code provides as follows:

 

A general release does not extend to claims which the creditor does not know or suspect to exist in his or her  favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.

 

b.             In light of the payment by the Company of all amounts due to me, I acknowledge and agreed that California Labor Code section 206.5 is not applicable.  That section provides in pertinent part as follows:

 

No employer shall require the execution of any release of any claim or right on account of wages due, or to become due, or made as an advance on wages to be earned, unless payment of such wages has been made.

 

11.                               Scope.  This Release does not extend to those rights which as a matter of law cannot be waived.

 

12.                               Applicable Law.  This Agreement shall be governed by California law.

 

13.                               Reimbursement of Reasonable Business Expenses.  I understand that by executing this Agreement, I am not releasing any claims for reimbursement of business-related expenses under Labor Code section 2802.  I also acknowledge that I am hereby advised of my right to consult with an attorney of my choosing about this business-related expenditures acknowledgement.  I hereby affirm that I have received full and adequate reimbursement for any necessary business-related expenditures or losses incurred by me in the course of my employment with the Company.

 

23

 

I have read the foregoing Separation Agreement and accept and agree to the provisions contained therein.  I hereby execute it voluntarily, after having had the opportunity to consult with an attorney, and with full understanding of its consequences.

 

	
TAILORED   BRANDS, INC.
    	
DOUGLAS   S. EWERT
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
Andrew Iwaskow
    	
 
    
	
 
    	
Executive Vice   President, Human Resources
    	
 
    
	
 
    	
Dated:               , 20
    	
 
    	
Dated:               , 20
    
					

 

24

 

Exhibit B

 

Form of Resignation

 

[see attached]

 

25

 

Letter of Resignation

 

                 , 2018

 

Tailored Brands, Inc.

6100 Stevenson Blvd.

Fremont, California 94538

Attention:  Chairman of the Board of Directors

 

Dear Mr. Chairman:

 

In accordance with Section 7(g) of the Second Amended and Restated Employment Agreement dated as of the date hereof (the “Employment Agreement”) between me and Tailored Brands, Inc., a Texas corporation (the “Company”), and Tailored Shared Services, LLC, a Delaware limited liability company, I hereby tender my resignation as a director and/or manager and officer of the Company and each of its subsidiaries, provided that such resignation shall be effective only in the event that (i) my employment with the Company has been terminated pursuant to any of the subsections of Section 6 of the Employment Agreement and (ii) the Board of Directors of the Company determines, upon such termination, by a resolution duly adopted by the Board of Directors, to accept my resignation.

 

This resignation is irrevocable and may not be withdrawn by me at any time.

 

	
Sincerely,
    
	
 
    
	
 
    	
 
    	
 
    
	
Douglas S. Ewert
    

 

26

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