Document:

Exhibit 10.1

 

Mark S. Demilio

104 Sagewood Court

Sparks, MD 21152

 

May 1, 2008

 

Dr. Rene
Lerer, President and Chief Executive Officer

Magellan
Health Services, Inc.

55
Nod Road

Avon,
CT 06001

 

Re. Amendment to Employment Agreement

 

Dear
Rene:

 

This
letter shall serve as an amendment to my Employment Agreement with Magellan
Health Services, Inc. (the “Company”) dated January 5, 2004 (the “Agreement”)
in connection with my planned resignation. 
Rene, as we discussed, I have thoroughly enjoyed our professional and
personal relationship and I am grateful and appreciative of the opportunities
afforded me by the Company.  I therefore
want to ensure that my resignation is as least disruptive to the Company and to
you as possible.  Accordingly, I agree
that I will remain employed with the Company and continue to diligently perform
all of the duties of CFO and devote my full time and attention to such duties as
specified in the Agreement for such period as reasonably necessary for the
Company to find and hire my replacement and to continue for a reasonable time
thereafter, at the option of the Company, in order to provide for a smooth
transition to such replacement.  The
Company agrees to use its best efforts to hire a replacement CFO as soon as
possible.

 

In exchange for such
agreement, the Company agrees that, in addition to the items specified in
section 6(a) of the Agreement, and notwithstanding anything to the contrary
in section 6(a) or elsewhere in the Agreement, I shall be entitled to the
following upon expiration of my employment pursuant to this amendment:

 

1.               A pro-rata bonus for 2008 (based
on the number of days employed in 2008 divided by 366) payable in accordance
with and subject to the terms of the 2008 STIP Plan (other than with respect to
continued employment requirements) and such bonus shall be equal to the amount
of funding of the Funding Pool attributable to the CFO as described in the 2008
STIP.  I understand and agree that such
payment will be made at the same time as payments, if any, to other eligible employees
under the 2008 STIP Plan (contemplated to be March 2009).

 

 

2.               Acceleration of vesting of
currently outstanding equity awards that otherwise would have vested in the
first quarter of 2009 in the event I had continued my employment so that such
equity shall vest as of the last day of my employment; and my vested equity
awards will remain exercisable for the period specified in section 6(a) of
the Agreement, provided that I agree I will not be able to exercise any option nor
receive any restricted stock under any award for which there is a performance
hurdle until such hurdle is satisfied and provided further that if such hurdle is
not met by March 31, 2010 such award shall be forfeited.  Notwithstanding the provisions of clause (ii) of
section 6(a) of the Agreement, for any option that is vested for which the
performance hurdle has not yet been met, I shall have until the 90th
day after such hurdle is satisfied to exercise such option.

 

The
Company also agrees that I can retain the laptop computers and home office
equipment after my employment provided that the Company will re-image to remove
all confidential information and applications other than a Windows Operating
System and Microsoft Office.  I also
agree to make myself available with reasonable prior notice for consultation by
telephone to answer questions for one year following my resignation.

 

All
other provisions of the Agreement not in conflict with this letter agreement, including
without limitation the provisions of Section 8 of the Agreement, shall
remain in full force and effect.  Please
sign below to evidence the Company’s agreement (including the agreement of the
Compensation Committee) to this amendment.

 

Thanks
Rene and I look forward to helping you and the Company through the transition
to a new CFO.

 

 

	
   

  	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Mark S. Demilio

  
	
   

  	
   

  	
  Mark
  S. Demilio

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ACCEPTED
  and AGREED,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Magellan
  Health Services, Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Rene Lerer

  	
   

  	
   

  	
   

  
	
   

  	
  Rene
  Lerer, CEO

  	
   

  	
   

  	
   

  
						

 

2Exhibit 10(a)

 

 

CBS Corporation

Terms and Conditions of the Performance Share Units

 

Granted Under the 2004 Long-Term Management
Incentive Plan

 

 

ARTICLE I

 

TERMS OF PERFORMANCE SHARE UNITS

 

 

Section 1.1 Grant of Performance Share Units. CBS Corporation, a
Delaware corporation (the “Company”), has awarded the Participant
performance share units (the “Performance Share Units”) under the CBS
Corporation 2004 Long-Term Management Incentive Plan, as amended from time to
time (the “Plan”). The Performance Share Units have been awarded to the
Participant subject to the terms and conditions contained in (A) the
certificate for the grant of Performance Share Units attached hereto (the “Performance
Share Units Certificate”), (B) the terms and conditions contained herein
(the Performance Share Units Certificate and the terms and conditions,
collectively, the “Certificate”) and (C) the Plan, the terms of which
are hereby incorporated by reference (the terms listed in (A), (B), and (C),
collectively, the “Terms and Conditions”). A copy of the Plan is being
provided to the Participant. Capitalized terms that are not otherwise defined
herein have the meanings assigned to them in the Performance Share Units
Certificate or the Plan. Performance Share Units are notional units of
measurement and represent the right to receive a number of shares of Class B
Common Stock determined on the basis of the performance of the Class B Common
Stock in comparison to the performance of the common stock of companies
comprising the Reference Group, on the terms and conditions set forth in the
Certificate.

 

Section 1.2 
Terms of Performance Share Units.

 

(a)          Valuation.
As of the Determination Date for each Measurement Period, the TSR of the Class
B Common Stock over such Measurement Period will be measured against the TSR of
the common stock of the companies comprising the Reference Group over the same
Measurement Period. Subject to Section 1.2(b), the percentile ranking of the
TSR of the Class B Common Stock as compared to the companies comprising the
Reference Group will be used to calculate the number of Shares that the
Participant will receive, in accordance with the following schedule (the “Schedule”):

 

 

	
   

  	
  Schedule

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  •  If the Company achieves
  less than the 25th percentile TSR, the award of Performance Share
  Units will be forfeited

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  •  If the Company achieves
  the 25th percentile TSR, the number of shares to be delivered
  under the award will be 25% of the Target Award

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  •  If the Company achieves
  the 50th percentile TSR, the number of shares to be delivered
  under the award will be 100% of the Target Award

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  •  If
  the Company achieves the 100th percentile TSR (that is, if it is
  the first ranked company in the Reference Group for TSR), the number of
  shares to be delivered under the award will be 200% of the Target Award

  	
   

  

 

For Company achievement at an intermediate point between the 25th and
50th percentile, or between the 50th percentile and the 100th percentile, the
number of Shares to be delivered will be interpolated between the respective
number of Shares to be delivered at such percentiles. For example, if the
Company were to achieve the 70th percentile TSR, the number of Shares to be
delivered would be 140% of the Target Award. Fractional Shares shall be rounded
to the next higher whole Share.

 

(b)          Minimum
Valuation Rule. Notwithstanding the valuation principles set forth in
Section 1.2(a), if for any Measurement Period for the award the Company
achieves less than the 50th percentile TSR, then the number of Shares to be
delivered under the award shall be the greater of:

 

(i)            if
the Company’s three year average of Budgeted Free Cash Flow during the
Measurement Period is met or exceeded by the three year average of Actual Free
Cash Flow during the Measurement Period (calculated in a manner consistent with
the free cash flow goal established for awards under the Senior Executive STIP,
including the relevant adjustment provisions of the Senior Executive STIP to
the extent consistent with the adjustment provisions of the Plan and Section
2.2 hereof and, to the extent relevant, the adjustments determined by the
Committee to be applicable for awards intended to qualify for the
performance-based compensation exception under Section 162(m) of the Code; provided,
however, that in the event that the Committee does not establish a free
cash flow goal in connection with the Senior Executive STIP, then the Committee
shall establish a free cash flow goal for purposes of this Section 1.2(b)(i)),
then the number of Shares to be awarded will equal the arithmetic average of
the Target Award and the number of Shares to be awarded pursuant to the
Schedule, rounded up to the nearest whole Share, provided that in the case of a
Qualifying Termination as a result of a Participant’s death where the
Measurement Period is shortened to less than a three year period, the
comparison of Budgeted Free Cash Flow to Actual Free Cash Flow shall be based
on the same period as the shortened Measurement Period; or

 

2

 

(ii)           if
the Company’s TSR in the last year of the Measurement Period is at or above the
50th percentile, then the number of Shares to be awarded shall be one-third
(1/3) of the Target Award;1

 

provided, however,
that in no case shall the number of Shares awarded pursuant to this Section
1.2(b) be less than the number of Shares the Participant is otherwise eligible
to receive pursuant to the Schedule.

 

(c)          Settlement
and Delivery of Shares. For each Measurement Period, Shares delivered in
settlement of the Performance Share Units will be delivered, net of any Shares
withheld to satisfy taxes, as soon as practicable following the Determination
Date for such Measurement Period and the date of the Committee meeting to
certify the TSR performance of the Performance Share Units for such Measurement
Period, as applicable.2 
Performance Share Units shall be payable in Shares, which may be
evidenced in such manner as the Committee in its discretion shall deem
appropriate, including, without limitation, book-entry registration; provided,
however, that such Shares shall bear such legends as the Committee, in
its sole discretion, may determine to be necessary or advisable. (The Company
currently does not issue share certificates for the Class B Common Stock.)  The Company will settle Performance Share
Units by delivering the corresponding number of Shares (less any Shares
withheld to satisfy withholding tax obligations) to the Participant’s equity
compensation account maintained with Smith Barney (or its successor as service
provider to the Company’s equity compensation plans). Following settlement, the
Participant may direct Smith Barney (or its successor) to sell some or all of
such Shares, may leave such Shares in such equity compensation account or may
transfer them to an account that the Participant maintains with a bank or
broker by following the instructions made available to the Participant by the
Company.

 

(d)  Dividend
Equivalents and Special Distributions. The Participant shall not be
entitled to receive Dividend Equivalents and the Performance Share Units shall
not otherwise be credited or adjusted to reflect any regular cash dividend on
the shares of Class B Common Stock underlying the Performance Share Units that
is paid while the Performance Share Units are outstanding hereunder.
Notwithstanding the foregoing, in the event that on any date while Performance
Share Units are outstanding hereunder the Company shall pay any dividend other
than a regular cash dividend or make any other distribution on the shares of
Class B Common Stock underlying the Performance Share Units (any such dividend
or distribution referred to herein as a “Special Distribution”), the
Committee shall determine, in its sole discretion pursuant to Section 7.1 of the
Plan, whether the Participant is entitled to receive, currently or on a
deferred basis and in such manner as the Committee may determine, such Special
Distribution based on the number of Shares equal to the Target Award attributed
to the Participant as of the record date for the Special Distribution.

 

 1  For
2007 grants only, if over such Measurement Period the Company achieves less
than the 50th percentile TSR and the Company’s TSR in the last year of the
Measurement Period is at or above the 50th percentile TSR, then the number of
Shares to be delivered under the award will equal the Target Award.

 

 2  For
2007 grants only, Shares to be delivered pursuant to Section 1.2(c) will be
delivered as soon as practicable following the third anniversary of the Grant
Date with regard to 50% of the award and as soon as practicable following the
fourth anniversary of the Grant Date with regard to 50% of the award.

 

3

 

(e)           Termination
of Employment.

 

(i)            Except
as set forth below under Section 1.2(e)(ii) with respect to a Participant’s
death, in the event the Participant’s employment with the Company or a
Subsidiary terminates in a Qualifying Termination prior to the Determination
Date for any Measurement Period, the number of Shares that the Participant will
receive for the applicable Measurement Period will be determined by multiplying
(x) the Shares determined under the applicable valuation criteria under Section
1.2(a) or 1.2(b) by (y) a fraction, the numerator of which is the number of
days starting with and inclusive of January 1st of the first calendar year of
the applicable Measurement Period and ending on the effective date of the
Participant’s Qualifying Termination and the denominator of which is the number
of days starting with and inclusive of January 1st of the first calendar year
of the applicable Measurement Period and ending on  December
31st of the last calendar year of the applicable  Measurement Period. If the product of (x) and
(y) results in a fractional Share, such fractional Share shall be rounded to
the next higher whole Share. Shares to be delivered in settlement of the
Performance Share Units pursuant to this Section 1.2(e)(i) will be delivered as
set forth in Section 1.2(c) above.

 

(ii)           In the event the Participant’s
employment with the Company or a Subsidiary terminates as a result of his or
her death prior to the Determination Date for any Measurement Period, the
number of Shares that the Participant’s estate will receive in respect of such
Measurement Period will be determined by multiplying (x) the number of Shares
determined under the applicable valuation criteria set forth in Section 1.2(a)
or 1.2(b) based on a Measurement Period shortened to the period starting with
and inclusive of January 1st of the first calendar year of the applicable
Measurement Period and ending on the December 31st following the date of the
Participant’s death by (y) a fraction, the numerator of which is the number of
days starting with and inclusive of January 1st of the first calendar year of
the applicable Measurement Period and ending on the effective date of the
Participant’s death and the denominator of which is the number of days starting
with and inclusive of January 1st of the first calendar year of the applicable
Measurement Period and ending on December 31st of the last calendar year of the
applicable Measurement Period. If the product of (x) and (y) results in a
fractional Share, such fractional Share shall be rounded to the next higher
whole Share. The number of Shares to be delivered in settlement of the
Performance Share Units pursuant to this Section 1.2(e)(ii) will be determined
as soon as practicable following the Determination Date for such Measurement
Period and the date of the Committee meeting to certify the TSR performance of
the Performance Share Units for such Measurement Period following the
Participant’s year of death, as applicable, and will be delivered in the manner
set forth in Section 1.2(c) above to the Participant’s estate as soon as practicable
thereafter.3

 

 

 3  For
2007 grants only, proration of awards pursuant to Section 1.2(e)(i) and
(ii) will apply in the event the Participant’s employment with the Company or a
Subsidiary terminates in a Qualifying Termination, including in the case of
death, prior to the third anniversary of the Grant Date with regard to 50% of
the award and prior to the fourth anniversary of the Grant Date with regard to
50% of the award and the maximum number of Shares that may be earned for any
Measurement Period will be capped at 95% of the Target Award for such
Measurement Period.

 

4

 

(iii)          In the event the Participant’s
employment with the Company or a Subsidiary terminates prior to a Determination
Date for any Measurement Period for any reason other than a Qualifying
Termination, the Participant shall forfeit all outstanding Performance Share
Units for such Measurement Period as of the date of such event.

 

(iv)          Notwithstanding anything else herein
to the contrary, if the Participant is a party to an employment agreement with
the Company or one of its Subsidiaries at the time of a termination of
employment that provides for different treatment from the foregoing provisions
of this Section 1.2(e), the terms of the Participant’s employment agreement
will control.

 

 

ARTICLE II

 

EFFECT OF CERTAIN CORPORATE CHANGES

 

 

Section 2.1 Effect of Certain Corporate
Changes. In the event of a merger, consolidation, stock split, reverse
stock split, dividend, distribution, combination, reclassification,
reorganization, split-up, spin-off or recapitalization that changes the
character or amount of the Class B Common Stock or any other changes in the
corporate structure, equity securities or capital structure of the Company, the
Committee shall make such adjustments, if any, to the number and kind of
securities subject to any outstanding Performance Share Units, as it deems
appropriate. The Committee may, in its sole discretion, also make such other
adjustments as it deems appropriate in order to preserve the benefits or
potential benefits intended to be made available hereunder and under the Plan.
Such determinations by the Committee shall be conclusive and binding on all
persons for all purposes.

 

Section 2.2 Adjustment of Performance Award. In the event that,
during any Measurement Period, any recapitalization, reorganization, merger,
acquisition, divestiture, consolidation, spin-off, combination, liquidation,
dissolution, sale of assets, or other similar corporate transaction or event, or
any other extraordinary event or circumstance occurs which has the effect, as
determined by the Committee, in its sole and absolute discretion, of distorting
the applicable performance criteria involving the Company, including, without
limitation, the calculation of TSR for any period or the comparison of Budgeted
Free Cash Flow to Actual Free Cash Flow pursuant to Section 1.2(b), the
Committee may adjust or modify, as determined by the Committee in its sole
discretion, the calculation of such performance criteria to the extent
necessary to prevent reduction or enlargement of the award of the Performance
Share Units for such Measurement Period attributable to such transaction,
circumstance or event. Such adjustments by the Committee shall be conclusive and
binding on all persons for all purposes.

 

5

 

ARTICLE III

 

DEFINITIONS

 

 

As used herein, the following terms shall
have the following meanings:

 

(a)   “Actual Free Cash Flow” means, for any
calendar year, the Free Cash Flow of the Company as defined under the Plan.

 

(b)   “Board” shall mean the Board of
Directors of the Company.

 

(c)   “Budgeted Free Cash Flow” means, for
any calendar year, the free cash flow amount approved by the Board as part of
the overall Company budget for such calendar year; provided, however,
that in the event that the Board shall not approve a Budgeted Free Cash Flow
amount by March 31st of any year (or March 30th in the
case of a leap year), the Committee shall establish a definition for Budgeted
Free Cash Flow prior to such date for purposes of Section 1.2(b) hereof.
Budgeted Free Cash Flow shall be calculated in a manner consistent with the
free cash flow goal established for awards under the Senior Executive STIP,
including the relevant adjustment provisions of the Senior Executive STIP to
the extent consistent with the adjustment provisions of the Plan and Section
2.2 hereof and, to the extent relevant, the adjustments determined by the
Committee to be applicable for awards intended to qualify for the
performance-based compensation exception under Section 162(m) of the Code; provided,
however, that in the event that the Committee does not establish a free
cash flow goal in connection with the Senior Executive STIP, then the Committee
shall establish a free cash flow goal for purposes of Section 1.2(b)(i) hereof.

 

(d)   “Certificate” shall mean the
Performance Share Units Certificate, together with the terms and conditions
contained herein.

 

(e)   “Class B Common Stock” shall mean
shares of Class B Common Stock, par value $0.001 per share, of the Company.

 

(f)    “Code” shall mean the U.S. Internal
Revenue Code of 1986, as amended, including any successor law thereto and the
rules and regulations promulgated thereunder from time to time.

 

(g)   “Committee” shall mean the
Compensation Committee of the Board (or such other Committee(s) as may be
appointed or designated by the Board to administer the Plan).

 

(h)   “Date of Grant” shall be the date set
forth on the Performance Share Units Certificate.

 

(i)    “Determination Date” shall mean, with
respect to each Measurement Period, the December 31st of the last
calendar year of such Measurement Period; provided, however, that
in the event the Participant’s employment with the Company terminates as a
result of the Participant’s death prior to such date, the Determination Date
for such Measurement Period will be the December 31st following the
date of the Participant’s death.

 

6

 

(j)    “Fair Market Value” of a share of Class
B Common Stock on a given date shall be the 4:00 p.m. (New York time) closing
price on such date on the New York Stock Exchange or other principal stock
exchange on which the Class B Common Stock is then listed, as reported by The
Wall Street Journal (Northeast edition) or as reported by any other
authoritative source selected by the Company.

 

(k)   “Good Reason” has the meaning assigned
to such term in the Participant’s employment agreement with the Company or
Subsidiary.

 

(l)    “Measurement Period” means the period
beginning on the starting date and ending on the end date specified in the
Participant’s Performance Share Units Certificate; provided, however,
that in the event the Participant’s employment with the Company terminates as a
result of the Participant’s death prior to the last day of any Measurement
Period, the Measurement Period will be shortened to the period starting with
and inclusive of January 1st of the first calendar year of the
applicable Measurement Period and ending on the December 31st
following the date of the Participant’s death.

 

(m)  “Participant” shall mean the employee
named on the Performance Share Units Certificate.

 

(n)   “Performance Share Units” shall mean
notional units of measurement representing the contractual right granted to the
Participant to receive shares of Class B Common Stock based on the performance
of the Class B Common Stock in comparison with the performance of the common
stock of the Reference Group over the applicable Measurement Period, on the
terms and conditions forth in the Certificate.

 

(o)   “Performance Share Units Certificate”
shall have the meaning set forth in Section 1.1 hereof.

 

(p)   “Permanent Disability” shall have the
same meaning as such term or a similar term has in the long-term disability
policy maintained by the Company or a Subsidiary thereof for the Participant
and that is in effect on the date of the onset of the Participant’s Permanent
Disability unless the Committee determines otherwise.

 

(q)   “Qualifying Termination” means (i) the
termination of the Participant’s employment by the Company or a Subsidiary
other than in a Termination for Cause; (ii) in the event the Participant has an
employment agreement with the Company or a Subsidiary that contains a Good
Reason termination provision or the Participant is otherwise covered by a
severance policy that provides for Good Reason termination, such Participant’s
resignation of employment for Good Reason; (iii) the termination of the
Participant’s employment with the Company or a Subsidiary by reason of the
Participant’s death, Retirement or Permanent Disability; or (iv) in the event
the Participant has an employment agreement with the Company or a Subsidiary,
the non-renewal of such employment agreement at the Company’s or Subsidiary’s
election followed by termination of the Participant’s employment with the
Company and any Subsidiary within six months of such contract expiration for
any reason other than a Termination for Cause.

 

7

 

(r)    “Reference Group” means all companies
whose common stock is included in the S&P 500 at the start of the
Measurement Period (other than (i) companies that cease to be included in the
S&P 500 during the Measurement Period solely due to merger, acquisition,
liquidation or similar events fundamentally changing the identity and nature of
the company and (ii) companies that cease to be included in the S&P 500
other than on account of events described in the preceding clause (i) and which
also cease to have common stock publicly traded on an exchange or on a
recognized market system or the over-the-counter market).

 

(s)   “Retirement” has the meaning assigned
to such term in the Plan.

 

(t)    “S&P 500” means the Standard
& Poor’s 500 Composite Index.

 

(u)   “Section 409A” shall mean Section 409A
of the Code and the rules, regulations and guidance promulgated thereunder from
time to time.

 

(v)   “Shares” means shares of the Company’s
Class B Common Stock.

 

(w)  “Subsidiary” shall mean a corporation
(or a partnership or other enterprise) in which the Company owns or controls,
directly or indirectly, more than 50% of the outstanding shares of stock
normally entitled to vote for the election of directors (or comparable equity
participation and voting power).

 

(x)    “Target Award” means, for each Measurement
Period, the number of shares of Class B Common Stock that the Participant is
eligible to receive for such Measurement Period, as indicated on the
Participant’s Performance Share Units Certificate.

 

(y)   “Termination for Cause” shall mean a
termination of employment with the Company or any of its Subsidiaries which, as
determined by the Committee, is by reason of (i) “cause” as such term or a
similar term is defined in any employment agreement that is in effect and
applicable to the Participant, or (ii) if there is no such employment agreement
or if such employment agreement contains no such term, unless the Committee
determines otherwise, the Participant’s: (A) dishonesty; (B) conviction of
embezzlement, fraud or other conduct which would constitute a felony; (C)
willful unauthorized disclosure of confidential information; (D) failure,
neglect of or refusal to substantially perform the duties of the Participant’s
employment; or (E) any other act or omission which is a material breach of the
Company’s policies regarding employment practices or the applicable federal,
state and local laws prohibiting discrimination or which is materially
injurious to the financial condition or business reputation of the Company or
any Subsidiary thereof.

 

(z)    “TSR” means for the Class B Common
Stock and for the common stock of each company in the Reference Group, the
percentage change in value (positive or negative) over the Measurement Period
as measured by dividing (i) the sum of (A) each company’s cumulative value of
dividends and other distributions in respect of its common stock for the
Measurement Period, assuming dividend reinvestment, and (B) the difference
(positive or negative) between each company’s common stock price on the first
and last day of the Measurement Period,

 

8

 

calculated based on the closing price on first day of the Measurement
Period and the average closing prices over the 20-day trading period
immediately prior to the last day of the Measurement Period, in each case, as
reported by Bloomberg L.P. (or such other reporting service that the Committee
may designate from time to time); by (ii) the common stock price on the first
day of the Measurement Period, calculated on the basis described above. Appropriate
and equitable adjustments will be made to account for stock splits and reverse
stock splits. TSR will be determined by the Committee in a manner consistent
with this definition. For purposes of computing TSR, if a company has more than
one class of common stock outstanding then only the class that is included in
the S&P 500 shall be taken into account, and if there is more than one such
class the company’s TSR shall be computed using the aggregate values of and
distributions on all such classes.

 

 

ARTICLE IV

 

MISCELLANEOUS

 

 

Section 4.1 
No Rights to Grants or Continued Employment. Neither the Terms
and Conditions nor any action taken in accordance with such documents shall
confer upon the Participant any right to be employed by or to continue in the
employment of the Company or any Subsidiary, or to receive any future awards
under the Plan or any other plan of the Company or any Subsidiary or interfere
with or limit the right of the Company or any Subsidiary to modify the terms of
or terminate the Participant’s employment at any time for any reason.

 

Section 4.2  Restriction on
Transfer. Performance Share Units may not be sold, transferred, assigned,
pledged or otherwise encumbered or disposed of, except by will, the laws of
descent and distribution or beneficiary designation; provided, however,
that the Committee may permit transferability, subject to any conditions and
limitations that it may, in its sole discretion, impose.

 

Section 4.3  Taxes. The
Company or a Subsidiary, as appropriate, shall be entitled to withhold from any
Performance Shares Units, and from any payment made with respect to the
Performance Shares Units or otherwise under the Plan to the Participant or a
Participant’s estate, any permitted transferee or beneficiary, an amount sufficient
to satisfy any U.S. federal, state, local and/or other tax withholding
requirements. The Company expects that, in order to satisfy such requirements,
it will, in connection with the delivery of shares of Class B Common Stock upon
settlement of Performance Shares Units, withhold from such delivery shares of
Class B Common Stock having a Fair Market Value equal to the amount of such
required withholding. As a condition to receiving this grant of Performance
Shares Units, the Participant has agreed to the foregoing actions to satisfy
such tax withholding requirements. Notwithstanding the foregoing, the Company
may, in its discretion and subject to such conditions as it may determine,
require or permit the Participant to satisfy such tax withholding requirements
through some other means (including without limitation by payment of a cash
amount equal to the amount of such tax withholding requirements or by delivery
of Class B Common Stock already

 

9

 

owned by the Participant having a Fair Market Value equal to the amount
of such tax withholding requirements).

 

Section 4.4  Stockholder
Rights; Unsecured Creditor Status. The grant of Performance Share Units
under the Certificate shall not entitle the Participant or a Participant’s
estate, any permitted transferee or beneficiary to any rights of a holder of
shares of Class B Common Stock, prior to the time the Participant, the
Participant’s estate, the permitted transferee or beneficiary shall become the
registered or beneficial holder of the Class B Common Stock underlying the
Performance Share Units and Shares are delivered to such party upon settlement
of the Performance Share Units. Except as set forth above under Section 1.2(d)
and unless otherwise determined by the Committee in its discretion, no
adjustment shall be made for dividends or distributions or other rights in
respect of any shares of Class B Common Stock for which the record date is
prior to the date on which the Participant, a Participant’s estate or any
permitted transferee shall become the registered or beneficial holder of such
shares of Class B Common Stock. Performance Share Units constitute unsecured
and unfunded obligations of the Company. As a holder of Performance Share
Units, the Participant shall have only the rights of a general unsecured
creditor of the Company.

 

Section 4.5 
No Restriction on Right of Company to Effect Corporate Changes.
The Terms and Conditions shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company’s capital
structure or its business, or any merger or consolidation of the Company, or
any issue of stock or of options, warrants or rights to purchase stock or of
bonds, debentures, preferred or prior preference stocks whose rights are
superior to or affect the Class B Common Stock or the rights thereof or which
are convertible into or exchangeable for Class B Common Stock, or the dissolution
or liquidation of the Company, or any sale or transfer of all or any part of
its assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise.

 

Section 4.6 
Section 409A. The intent of the Company is that payments and
distributions under these Terms and Conditions comply with Section 409A and,
accordingly, to the maximum extent permitted, these Terms and Conditions shall
be interpreted to be in compliance therewith. Notwithstanding anything herein
to the contrary, if the Participant is deemed on the date of his or her
“separation from service” (as determined by the Company pursuant to Section
409A) to be one of the Company’s “specified employees” (as determined by the
Company pursuant to Section 409A), then any portion of any of the Participant’s
Performance Share Units that constitutes deferred compensation within the
meaning of Section 409A and is payable or distributable upon the Participant’s
separation from service shall not be made or provided prior to the earlier of
(i) the expiration of the six-month period measured from the date of the
Participant’s separation from service or (ii) the date of Participant’s death
(the “Delay Period”). All payments and distributions delayed pursuant to
this Section 4.6 shall be paid or distributed to the Participant within 30 days
following the end of the Delay Period subject to applicable withholding, and
any remaining payments and distributions due thereafter under these Terms and
Conditions shall be paid or distributed in accordance with the dates specified
for them herein. In no event shall the Company or any of its Subsidiaries be
liable for

 

10

 

any tax, interest or penalties that may be imposed on the Participant
by Section 409A or any damages for failing to comply with Section 409A.

 

Section 4.7 
Interpretation. In the event of any conflict between the
provisions of the Certificate (including the definitions set forth herein) and
those of the Plan, the provisions of the Plan will control. Additionally, in
the event of a conflict or ambiguity between the provisions of the Certificate
or the Plan and the provisions of any employment agreement that is in effect
and applicable to the Participant with respect to the Performance Share Units,
the provisions of such employment agreement shall be deemed controlling to the
extent such provisions are consistent with the provisions of the Plan and are
more favorable to the Participant than the provisions of the Certificate.

 

Section 4.8 
Governmental Regulations. The Performance Share Units shall be
subject to all applicable rules and regulations of governmental or other
authorities.

 

Section 4.9 
Headings. The headings of articles and sections herein are
included solely for convenience of reference and shall not affect the meaning
of any of the provisions of the Terms and Conditions.

 

Section 4.10 
Governing Law. The Terms and Conditions and all rights hereunder
shall be construed in accordance with and governed by the laws of the State of
Delaware.

 

11

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