Document:

Exhibit 10.3

 

FORM OF

 

THE BON-TON STORES, INC.

 

RESTRICTED STOCK AGREEMENT - PERFORMANCE SHARES

 

This Restricted Stock Agreement — Performance Shares dated as of August 25, 2014 (“Agreement”), is between The Bon-Ton Stores, Inc. (the “Company”) and Kathryn Bufano (the “Grantee”).

 

1.                                      Definitions. As used herein:

 

(a)                                 “Committee” means the Human Resources and Compensation Committee of the Board of Directors of the Company, or such other committee as may be designated by the Board of Directors pursuant to the Plan.

 

(b)                                 “Date of Grant” means August 25, 2014, the date on which the Company awarded the Restricted Stock (the “Award”).

 

(c)                                  “Employment Agreement” means the Employment Agreement dated July 28, 2014 and effective as of August 25, 2014 between Grantee and the Company, as amended from time to time.

 

(d)                                 “Forfeiture Date” means any date during the Restricted Period on which Grantee’s employment with the Company or an Affiliate of the Company terminates for any reason other than (i) Death; (ii) Disability or Incapacity (as defined in the Employment Agreement), (iii) Grantee’s resignation for Good Reason (as defined in the Employment Agreement), or (iv) Grantee’s discharge without Cause (as defined in the Employment Agreement). For purposes of this Agreement, “Affiliate” shall mean a corporation that is a parent corporation or a subsidiary corporation with respect to the Company within the meaning of Section 424(e) or (f) of the Internal Revenue Code of 1986, as amended (the “Code”)..

 

(e)                                  “Plan” means The Bon-Ton Stores, Inc. 2009 Omnibus Incentive Plan, as may be amended from time to time.

 

(f)                                   “Restricted Period” with respect to any shares of Restricted Stock (as hereinafter defined) means the period beginning on the Date of Grant and ending on the Vesting Date for such shares.

 

(g)                                  “Vesting Date” means the date or dates set as upon which the Restricted Stock shall vest.

 

All other capitalized terms used herein shall have the meaning set forth in the Plan except to the extent the context clearly requires otherwise. This Agreement is intended to be consistent with the terms of the Plan and is subject in all regards to the terms of the Plan. All determinations regarding the vesting of Restricted Stock hereunder shall be made by the Committee consistent with the Plan’s provisions regarding performance-based compensation. In any case where there

 

 

is a conflict between the terms of this Agreement and the terms of the Plan, the conflict shall be resolved in favor of the Plan.

 

Notwithstanding anything contained in this Agreement or the Plan documents to the contrary, in the event Grantee’s employment with the company is terminated without Cause (as defined in the Employment Agreement), Grantee resigns for Good Reason (as defined in the Employment Agreement), Grantee’s employment is terminated due to Death, or Grantee’s employment is terminated due to Disability or Incapacity (as defined in the Employment Agreement), it is expressly agreed and understood that all of the Grantee’s then unvested Restricted Stock granted pursuant to this Agreement shall remain outstanding through the remainder of the applicable performance period (without regard to any continued employment requirement) and if or to the extent the performance provisions are attained shall become vested without regard to any continued employment requirement.

 

2.                                      Grant of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company grants to Grantee 175,000 shares of the Company’s Common Stock, par value $.01 (the “Restricted Stock”). The Restricted Stock is subject to vesting (or forfeiture) on the basis of the achievement of certain performance goals established for the Company’s 2014, 2015 and 2016 fiscal years (i.e., the fiscal years ending on or about January 31, 2015, January 30, 2016, and January 28, 2017, respectively). Except as otherwise provided herein, the Restricted Stock shall vest (or be forfeited) as follows:

 

(a)                                 Fiscal Year 2014.

 

(i)                                     2014 Fiscal Year Performance Targets. 75,000 shares of the Restricted Stock shall become vested or shall be forfeited as a result of the achievement or non-achievement of performance targets for the selected performance metrics established for the Company’s 2014 fiscal year by the Committee.  Subject to the terms of the Employment Agreement, these performance targets have been determined by the Committee consistent with the Plan and in the normal course (i.e., in the first quarter of the Company’s 2014 fiscal year).

 

(ii)                                  2014 Fiscal Year Vesting Date. The Vesting Date with respect to such Restricted Stock shall be as of January 31, 2015, subject to the Committee’s certification in writing of its determination of the level of achievement of the performance goals established in connection with the vesting of such shares of Restricted Stock (without regard to whether Grantee has remained employed by the Company or an Affiliate of the Company after the Vesting Date).  Any portion of such Restricted Stock not vested as a result of such determination shall be considered as having been forfeited as of January 31, 2015.

 

(b)                                 Fiscal Year 2015.

 

(i)                                     2015 Fiscal Year Performance Targets. 50,000 shares of the Restricted Stock shall become vested or shall be forfeited as a result of the achievement or non-achievement of performance targets for the selected performance metrics to be established for the Company’s 2015 fiscal year by the Committee.  Subject to the terms of the Employment Agreement, these performance targets shall be determined by the Committee consistent with the Plan and in the normal course (i.e., in the first quarter of the Company’s 2015 fiscal year).

 

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(ii)                                  2015 Fiscal Year Vesting Date. The Vesting Date with respect to such Restricted Stock shall be as of January 30, 2016, subject to the Committee’s certification in writing of its determination of the level of achievement of the performance goals established in connection with the vesting of such shares of Restricted Stock (without regard to whether Grantee has remained employed by the Company or an Affiliate of the Company after the Vesting Date). Any portion of such Restricted Stock not vested as a result of such determination shall be considered as having been forfeited as of January 30, 2016.

 

(c)                                  Fiscal Year 2016.

 

(i)                                     2016 Fiscal Year Performance Targets. 50,000 shares of the Restricted Stock shall become vested or shall be forfeited as a result of the achievement or non-achievement of performance targets for the selected performance metrics to be established for the Company’s 2016 fiscal year by the Committee.  Subject to the terms of the Employment Agreement, these performance targets shall be determined by the Committee consistent with the Plan and in the normal course (i.e., in the first quarter of the Company’s 2016 fiscal year).

 

(ii)                                  2016 Fiscal Year Vesting Date. The Vesting Date with respect to such Restricted Stock shall be as of January 28, 2017, subject to the Committee’s certification in writing of its determination of the level of achievement of the performance goals established in connection with the vesting of such shares of Restricted Stock (without regard to whether Grantee has remained employed by the Company or an Affiliate of the Company after the Vesting Date).  Any portion of such Restricted Stock not vested as a result of such determination shall be considered as having been forfeited as of January 28, 2017.

 

(d)                                 Death; Disability or Incapacity; Resignation for Good Reason; Discharge without Cause.  Notwithstanding the foregoing, if Grantee’s employment with the Company is terminated as a result of (i) Death, (ii) Disability or Incapacity (as defined in the Employment Agreement), (iii) Grantee’s resignation for Good Reason (as defined in the Employment Agreement), or (iv) Grantee’s discharge without Cause (as defined in the Employment Agreement), all of the Grantee’s then unvested Restricted Stock granted pursuant to this Agreement shall remain outstanding through the remainder of the applicable performance period (without regard to any continued employment requirement) and if or to the extent the performance provisions are attained shall become vested without regard to any continued employment requirement.  In any situation subject to this Paragraph 2(d) of the Agreement, the Vesting Date shall be the end of the fiscal year coinciding with the end of the applicable performance period, i.e., January 31, 2015, January 30, 2016, or January 28, 2017, as the case may be.

 

3.                                      Restrictions on Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any Restricted Stock during such shares’ Restricted Period.

 

4.                                      Lapse of Restrictions.  Subject to the terms and conditions set forth herein and in the Plan, the restrictions on Restricted Stock set forth in Paragraph 3 shall lapse on such shares’ applicable Vesting Date; provided, however, that on such Vesting Date Grantee is, and has

 

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continuously been, an employee of the Company or an Affiliate of the Company during such shares’ Restricted Period.

 

5.                                      Forfeiture of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, if Grantee’s employment with the Company or an Affiliate of the Company terminates during the Restricted Period for any reason other than (i) Death, (ii)  Disability or Incapacity (as defined in the Employment Agreement), (iii) Grantee’s resignation for Good Reason (as defined in the Employment Agreement), or (iv) Grantee’s discharge without Cause (as defined in the Employment Agreement), Grantee shall forfeit any Restricted Stock still subject to restrictions as of the Forfeiture Date. Upon a forfeiture of any shares of Restricted Stock as provided in this Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without consideration.

 

6.                                      Rights of Grantee.  Except for the restrictions set forth in Paragraph 3, during the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the Restricted Stock, including the right to vote the Restricted Stock to the same extent that such shares could be voted if they were not subject to the restrictions set forth in this Agreement. However, cash dividends payable with respect to the Restricted Stock during the Restricted Period shall not accrue or be paid to Grantee. Any extraordinary dividends or dividends that are in the nature of a distribution of shares or are otherwise equivalent to a stock split, shall be subject to the same restrictions as apply to the Restricted Stock with respect to which such extraordinary dividends or shares were issued and shall be forfeited in accordance with Paragraph 5 unless the restrictions lapse in accordance with Paragraph 4.

 

7.                                      Change of Control of the Company.  In the event of a Change of Control, if any equity awards are not converted or replaced, all of Grantee’s then unvested Restricted Stock awarded herein will automatically vest in full.

 

8.                                      Notices.  Any notice to be given to the Company shall be addressed to the General Counsel of the Company at its principal executive office, and any notice to be given to Grantee shall be addressed to Grantee at the address then appearing on the personnel records of the Company or the Affiliate of the Company by which he or she is employed, or at such other address as either party hereafter may designate in writing to the other. Any such notice shall be deemed to have been duly given when personally delivered, sent by recognized courier service, or by other messenger, or when deposited in the United States mail, addressed as aforesaid, registered or certified mail, and with proper postage and registration or certification fees prepaid.

 

9.                                      Securities Laws.  The Committee may from time to time impose any conditions on the Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as amended.

 

10.                               Delivery of Shares.  Upon a determination that the Restricted Stock has become vested, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in the event of Grantee’s Death) that the restrictions on the Restricted Stock have lapsed, and shall, without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a certificate for such Restricted Stock without any legend or restrictions, except for such

 

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restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 9, provided that no certificates for shares will be delivered to Grantee (or to his or her personal representative, heir or legatee) until appropriate arrangements have been made with the Company for the withholding of any taxes which may be due with respect to such shares. The Company may condition delivery of certificates for shares upon the prior receipt from Grantee of any undertakings which it may determine are required to assure that the certificates are being issued in compliance with federal and state securities laws. The right to payment of any fractional shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair Market Value of a share on the Vesting Date.

 

11.                               Status of Restricted Stock.  The Restricted Stock is intended to constitute property that is subject to a substantial risk of forfeiture during the Restricted Period, and subject to federal income tax in accordance with section 83 of the Code. Section 83 generally provides that Grantee will recognize compensation income with respect to the Restricted Stock on such Restricted Stock’s Vesting Date in an amount equal to the then Fair Market Value of the shares for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date of Grant in an amount equal to the Fair Market Value of the Restricted Stock subject to the election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and Grantee shall immediately notify the Company if such an election is made. Grantee should consult his or her tax advisors to determine whether a Section 83(b) election is appropriate.

 

12.                               Administration.  This Award has been granted pursuant to and is subject to the terms and provisions of the Plan. All questions of interpretation and application of the Plan and this Award shall be determined by the Committee. The Committee’s determination shall be final, binding and conclusive.

 

13.                               Award Not to Affect Employment.  Nothing herein contained shall affect the right of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities, duties, or authority to represent the Company or any Affiliate at any time for any reason whatsoever.

 

14.                               Withholding of Taxes. Whenever the Company proposes or is required to deliver or transfer shares in connection with this Award, the Company shall have the right to (a) require Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local withholding tax requirements prior to the delivery or transfer of any certificate or certificates for such shares or (b) take whatever action it deems necessary to protect its interest with respect to tax liabilities.

 

15.                               Compensation Recovery Policy. In addition to, and not in limitation of, the Company’s rights under Paragraph 5, in the event of a restatement of the Company’s financial statements, the Company may take action to recoup Restricted Stock earned or distributed in accordance with the Company’s Compensation Recovery Policy.

 

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16.                               Governing Law. The validity, performance, construction and effect of this Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect to principles of conflicts of law.

 

17.                               Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

 

[Signature page follows.]

 

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IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement as of the day and year first above written.

 

	
 
    	
THE BON-TON STORES, INC.
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Tim Grumbacher
    
	
 
    	
 
    	
Tim Grumbacher,
    
	
 
    	
 
    	
Chairman of the Board of Directors
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Grantee:
    
	
 
    	
 
    
	
 
    	
/s/ Kathryn Bufano
    
	
 
    	
Kathryn Bufano
    

 

7Exhibit 4.6

 

Agreement for Subscription for the Ninth Share Option Offering (tax-qualified)

 

This Agreement is made and entered into by and between UBIC, Inc. (hereinafter referred to as the “Company”) and                         (hereinafter referred to as the “Subscriber”) with respect to the subscription for the ninth share option offering.

 

Article 1 (Subscription for Share Options)

 

In accordance with the resolution of the tenth annual shareholders’ meeting held on June 25, 2013 and the resolution of the board meeting held on May 22, 2014, the Company has determined the following requirements for the ninth share option offering (hereinafter referred to as the “Share Options”), of which the Subscriber subscribes for           options. Since this Agreement shall be made integrally at the same time with other subscribers in accordance with Article 244 of the Companies Act of Japan, the Subscriber shall subscribe for the Share Options simultaneously with the other subscribers collectively for the total number of Share Options described below.

 

Description

 

Requirements for the offering of Share Options

 

(1)                      Class and number of shares covered by the Share Options

 

200,000 Class A common shares, which, in case of adjustment set forth below, shall be revised to the number of granted shares after adjustment multiplied by the total number of Share Options.

 

Number of shares covered by one (1) Share Option (hereinafter referred to as the “Number of Granted Shares”) shall be 100 class A common shares. In the event of a stock split (including a gratis allotment of common stock and this being applicable hereinafter, as well) or a reverse split by the Company after the day when the Share Options are allotted (hereinafter referred to as the “Date of Allotment”), the following formula shall be used to adjust the Number of Granted Shares covered by the Share Options that have not been exercised at the time of adjustment. Fractional share resulting from adjustment shall be discarded.

 

Number of Granted Shares after adjustment = Number of Granted Shares before adjustment × ratio of split or reverse split

 

Any adjustment of the Number of Granted Shares which may be required in other situations shall be made to a reasonable extent.

 

(2)                      Total number of Share Options

 

2,000

 

(3)                      Amount payable in exchange of the Share Options

 

No payment is required in exchange of the Share Options

 

(4)                      Manner of calculating the value of assets contributed in exercising the Share Options

 

48,900 yen for one (1) Share Option

 

Value of assets contributed in exercising one (1) Share Option shall be obtained by multiplying the amount paid per share for the shares delivered upon exercise of the Share Option (hereinafter referred to as the “Exercise Price”) by the Number of Granted Shares.

 

The Exercise Price shall be 489 yen

 

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If any of the following events occurs on or after the Date of Allotment, the Exercise Price  shall be adjusted as follows.

 

(i)                  For the share split or reverse split by the Company, the Exercise Price shall be adjusted in accordance with the formula stated below and fractional yen resulting from the adjustment shall be rounded up to the nearest yen.

 

	
Exercise Price after adjustment
    	
=
    	
Exercise Price before adjustment
    	
×
    	
1
    
	
ratio of share split or reverse split
    

 

(ii)               If the Company issues new shares at a price below the market price or dispose of the treasury stock, the Exercise Price shall be adjusted in accordance with the formula stated below and fractional yen resulting from the adjustment shall be rounded up to the nearest yen.

 

	
Exercise Price after adjustment
    	
=
    	
Exercise Price before adjustment
    	
×
    	
number of issued shares
    	
+
    	
number of newly issued shares × amount paid per share
    
	
market price
    
	
number of issued shares + number of newly issued shares
    

 

In the above formula, the “number of issued shares” means the total number of shares issued by the Company less the number of treasury stock in the possession of the Company. In case of the disposition of treasury stock, the “number of newly issued shares” shall read “number of treasury stock disposed of.”

 

(iii)            In case of merger or company split of the Company or other inevitable situations which require the adjustment of the Exercise Price, the adjustment shall be made to a reasonable extent taking into account the conditions of merger or company split.

 

(5)                      Period during which the Share Options can be exercised

 

From May 23, 2017 to May 22, 2020

 

(6)                      Conditions to exercise the Share Options

 

(i)             Person to whom the Share Options are allotted (hereinafter referred to as the “Share Option Holder”) must be either a director, statutory auditor, executive officer or employee of the Company or its subsidiary, or a supplier to the Company at the time of exercising the option, except if such person resigns due to expiry of term of office, retires by age limit or terminates employment due to a company’s reason or if otherwise justified by the board of directors.

 

(ii)          No Share Option shall be inherited.

 

(iii)       No fractional Share Option shall be exercised.

 

(iv)      All other conditions shall be as set forth in the “Agreement for Share Options Allotment” to be entered into between the Company and the Share Option Holder pursuant to the relevant resolution of the board meeting.

 

(7)                      Reason and conditions for acquisition of the Share Options

 

In the event that a proposal to approve a merger agreement where the Company is to be extinguished is approved at the shareholders’ meeting of the Company or that a proposal to approve a stock swap agreement where the Company is to be wholly owned or a proposal to approve a stock transfer plan is approved at the shareholders’ meeting of the Company (or, if a resolution of the shareholders’ meeting is not required, is resolved by the board meeting of the Company), the Company may acquire the Share Options at free on the day separately designated by the board of directors.

 

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(8)                      Restriction on acquisition of the Share Options by assignment

 

Acquisition of the Share Options by assignment shall require an approval of the board of directors of the Company.

 

(9)                      Conditions for the capital and capital reserve increase by issuance of shares upon exercise of the Share Options

 

(i)                           Amount of capital increase when the shares are issued upon exercise of the Share Options shall be one half of the maximum capital increase calculated in accordance with paragraph 1, Article 17 of the Ordinance on Company Accounting and fractional yen resulting from the calculation shall be rounded up to the nearest yen.

 

(ii)                        Amount of capital reserve increase when the shares are issued upon exercise of the Share Options shall be the maximum capital increase referred to in the item (i) above less the amount of capital increase obtained under the item (i) above.

 

(10)               Handling of the Share Options in case of corporate reorganization

 

In the event of a merger (limited to the cases where the Company is to be extinguished), absorption-type company split or incorporation-type company split (limited to the cases where the Company is to be split), or stock swap or stock transfer (limited to the cases where the Company is to be a wholly-owned subsidiary) (hereinafter collectively referred to as the “Corporate Reorganization”), the Company shall deliver the share options of a stock company prescribed in Section 236.1.8 (a) to (e) of the Companies Act of Japan(hereinafter referred to as the “Reorganized Company”) to the Share Option Holder who has the Share Options remaining (hereinafter referred to as the “Remaining Share Options”) immediately prior to the day when the Corporate Reorganization comes into effect (that is, for a merger, the day when the merger comes into effect; for a consolidation, the day when a stock company is incorporated through consolidation; for an absorption-type company split, the day when the absorption-type company split comes into effect; for an incorporation-type company split, a stock company is incorporated from the incorporation-type company split; for a stock swap, the day when the stock swap comes into effect; and for a stock transfer, the day when a wholly owning parent company incorporated through stock transfer, and these being applicable hereinafter, as well). In this case, the Remaining Share Options shall be extinguished and the Reorganized Company shall newly issue the share options, provided that the merger agreement, consolidation agreement, absorption-type company split agreement, incorporation-type company split plan, stock swap agreement or stock transfer plan shall contain the statement that the Reorganized Company will deliver the share options in accordance with the following provisions.

 

(i)                           Number of Share Options of the Reorganized Company to be delivered
 The same number as the Remaining Share Options in the possession of the Share Option Holder shall be delivered.

 

(ii)                        Type of stock of the Reorganized Company covered by the share options
 Common shares of the Reorganized Company

 

(iii)                     Number of shares of the Reorganized Company covered by the share options
 To be determined in accordance with the above “(1) Class and number of shares covered by the Share Options” taking into account the conditions for Corporate Reorganization.

 

(iv)                    Manner of calculation of the value of assets contributed to exercise the share options
 Value of assets contributed in exercising one (1) Share Option to be delivered shall be obtained by multiplying the Exercise Price after adjustment prescribed in the item (4) (iii) above by the number of shares of the Reorganized Company covered by such Share Option as determined under the item (iii) above.

 

(v)                       Period during which the share options can be exercised
 From the day when the above “(5) Period during which the Share Options can be

 

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exercised” commences or the day when the Corporate Reorganization comes into effect, whichever is the later, to the day when the above “(5) Period during which the Share Options can be exercised” expires

 

(vi)                    Conditions for the capital and capital reserve increase by issuance of shares upon exercise of the share options
  To be determined in accordance with the above “(9) Conditions for the capital and capital reserve increase by issuance of shares upon exercise of the Share Options”

 

(vii)                 Restriction on acquisition of the share options by assignment
 Acquisition of the share options by assignment shall require an approval of the board of directors of the Reorganized Company.

 

(viii)              Reason and conditions for acquisition of the share options
 To be determined in accordance with the above “(7) Reason and conditions for acquisition of the Share Options”

 

(11)               Fractional share delivered upon exercise of the Share Options
 Fractional share delivered upon exercise of the Share Options shall be discarded.

 

(12)               Date of Allotment

 

May 22, 2014 (Thursday)

 

Article 2 (Special Provisions for Exercise of Option)

 

1.              In addition to the conditions provided in other Articles hereof, the following restrictions shall be applied to the Subscriber in exercising the Share Options.

 

(1)              Total amount paid in exercising the options (including exercising the share options and equity warrant under both the Companies Act of Japan and the Old Commercial Code (hereinafter jointly referred to as the “Share Warrant, etc.”)) shall not exceed 12,000,000 yen for a calendar year. For the avoidance of doubt, total amount including the amount paid in exercising the Share Warrant, etc. granted by the Company and by other companies collectively shall not exceed 12,000,000 yen for a calendar year.

 

(2)              The Subscriber shall make arrangement with a financial instruments business operator nominated by the Company (hereinafter referred to as the “Financial Instruments Business Operator”) for the entry or registration in the transfer account registry (hereinafter referred to as the “Transfer”), entrustment of storage or trust for management and disposition (hereinafter referred to as the “Management Trust”) (to be segmented for each share option holder) in compliance with statutory tax qualification requirements with respect to the shares acquired upon exercise of the option and shall take all measures required for the entrustment of the Transfer to the Subscriber’s account opened with the Financial Instruments Business Operator with whom such arrangement is made and the storage at a branch or an office of the Financial Instruments Business Operator with whom such arrangement is made or required for the Management Trust.

 

2.              Notwithstanding the provisions of paragraph (8) of Article 1, the Subscriber shall not assign, or place the security right on, the Share Options.

 

3.              If the Subscriber falls under any of the situations stated below, the Subscriber and its successor shall not exercise the Share Options and loses them.

 

(1)              A petition is filed by third party against the Subscriber for the attachment, provisional attachment, provisional disposition or auction or the commencement of procedures of bankruptcy or civil rehabilitation.

 

(2)              A petition is filed by the Subscriber itself for the commencement of procedures of bankruptcy or civil rehabilitation.

 

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(3)              There are other reasons that objectively show a significant worsening financial status of the Subscriber.

 

(4)              The Subscriber is sentenced to imprisonment without work or a heavier punishment.

 

(5)              The Subscriber who is an employee of the Company or its subsidiary is punished under the office rules of the Company or its subsidiary as disciplinary dismissal or retirement under instruction.

 

4.              The Company shall deliver the shares against exercise of option by the Subscriber, including issuing new shares or transferring or assigning existing shares, without violation of the requirements for offering of the Share Options.

 

Article 3 (Manner of Exercising the Option)

 

1.              In exercising the Share Options, the Subscriber shall transfer the amount paid to the bank account designated by the Company and shall provide the Company with the application (claim) for exercise of the share options in a given form.

 

2.              To exercise the options in a manner set forth in the preceding paragraph, the Subscriber shall open an account in his name with the Financial Instruments Business Operator in a manner prescribed by the Company.

 

3.              Immediately after completion of the procedures for the Subscriber to exercise the Share Options, the Company shall take measures required for the entrustment of the entry or registration of the shares acquired by the Subscriber by exercising the Share Options in the account in name of the Subscriber opened with the Financial Instruments Business Operator under the preceding paragraph and the storage at a branch or an office of the Financial Instruments Business Operator or required for the Management Trust.

 

4.              If the tax exemption measures under Article 29-2 of the Act on Special Measures concerning Taxation are not applied to the exercise of the Share Options, the Subscriber shall pay the amount equal to the withholding income tax imposed on the economic profit from the acquisition of shares by exercising the Share Options together with the amount paid under the paragraph 1.

 

Article 4 (Manner of Expressing Intention and Giving a Notice)

 

1.              The Company shall express its intention or give a notice to the Subscriber by sending documents either by mail to the address of the Subscriber recorded in the Share Option Registry or by sending an e-mail to the address preliminarily notified by the Subscriber to the Company.

 

2.              Any change in any one of the following items must be notified by the Subscriber to the Company.

 

(1)              Name of the Subscriber

 

(2)              Address of the Subscriber

 

(3)              E-mail address for the purpose of the preceding paragraph

 

3.              If the Subscriber fails to notify as set forth in the preceding paragraph, the address recorded in the Share Option Registry shall be considered as the current address of the Share Option Holder.

 

4.              The notice set forth in the paragraph 1 shall be deemed to have arrived at the time when it would have ordinarily arrived.

 

5.              Provisions of the preceding paragraphs shall be applied to the resignation due to expiry of term of office, retirement by age limit or termination of employment by a company’s reason as provided in Article 1(6)(i) and other cases justified by the board of directors.

 

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Article 5 (Abandonment of Claim for Damages)

 

The Subscriber shall not hold the Company, its director or any other parties to whom the Company entrusted the business transactions liable for covering losses, adding profits, compensating damages, nor claim or pursue any responsibilities against the parties above in connection with this Agreement  irrespective of reasons.

 

Article 6 (Right to Establish Bylaws)

 

1.              The Company may establish, amend or abolish the “Bylaws to Agreement for Share Options Allotment” (hereinafter referred to as the “Bylaws”) to provide for the rules regarding the enforcement of this Agreement.

 

2.              The Company must promptly notify the Subscriber of the Bylaws which may be established, amended or abolished under the preceding paragraph.

 

3.              The Subscriber may request the Company to allow access to the Bylaws during its business hours and may copy the same at the Subscriber’s cost.

 

Article 7 (Amendment to Agreement)

 

1.              If any provision hereof proves to be incompliant with any provision of the Income Tax Act, Corporation Tax Act or other tax laws or becomes incompliant with the same due to revisions after execution of this Agreement, the Company may amend or abolish such provision by giving a notice to the Subscriber. This rule shall be applied if any provision hereof proves to be or becomes incompliant with the Companies Act, Financial Instruments and Exchange Act or other relevant laws.

 

2.              In addition to the preceding paragraph, the Company may make a proposal to the Subscriber to amend this Agreement if deemed necessary.

 

3.              If the Subscriber does not lodge any objection with the Company in writing stating due reasons within three (3) weeks after the proposal under the preceding paragraph, this Agreement shall be deemed to have been automatically amended as proposed by the Company.

 

Article 8 (Taxation Process)

 

The Subscriber shall pay at his cost and responsibility the income tax and any other taxes and dues imposed as a result of the subscription and exercise of the Share Options and the sale of the Company’s shares acquired upon exercise thereof.

 

Article 9 (Handling of Issues Not Specified)

 

Handling of issues not specified in this Agreement or the Bylaws shall be faithfully negotiated by the Company and the Subscriber and, if the Subscriber does not agree to negotiate or no agreement is reached between both parties after negotiation, shall be determined by the Company.

 

Article 10 (Governing and Jurisdiction)

 

The Company and the Subscriber agree that the Japanese law shall govern this Agreement and any dispute hereunder shall be submitted to the Tokyo District Court which has the exclusive jurisdiction for the first trial.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in two (2) copies with their respective names and seals and the Company and the Subscriber shall retain the original copies, respectively.

 

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June 10, 2014

 

Company:                                     UBIC, Inc.

 

Masahiro Morimoto, President and Representative Director

 

2-12-23, Kounan, Minato Ward, Tokyo

 

Subscriber:                                    (Address)

 

(Name)

 

7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00233-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00233-of-00352.parquet"}]]