Document:

Exhibit 4.1

 

JANUS CAPITAL GROUP INC.

 

2012 Employment Inducement Award Plan

 

(adopted effective as of January 24, 2012

and amended and restated as of November 28, 2014))

 

 

Table of Contents

 

	
Article
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
1.     History, Effective Date, Objectives and Duration
    	
 
    	
1
    
	
 
    	
 
    	
 
    
	
2.     Definitions
    	
 
    	
1
    
	
 
    	
 
    	
 
    
	
3.     Administration
    	
 
    	
7
    
	
 
    	
 
    	
 
    
	
4.   Shares   Subject to the Plan and Maximum Awards
    	
 
    	
9
    
	
 
    	
 
    	
 
    
	
5.     Eligibility and General Conditions of Awards
    	
 
    	
10
    
	
 
    	
 
    	
 
    
	
6.   Stock   Options
    	
 
    	
13
    
	
 
    	
 
    	
 
    
	
7.   Stock   Appreciation Rights and Limited Stock Appreciation Rights
    	
 
    	
14
    
	
 
    	
 
    	
 
    
	
8.     Restricted Shares
    	
 
    	
15
    
	
 
    	
 
    	
 
    
	
9.     Beneficiary Designation
    	
 
    	
16
    
	
 
    	
 
    	
 
    
	
10.    Deferrals
    	
 
    	
17
    
	
 
    	
 
    	
 
    
	
11.  Rights   of Employees/Directors/Consultants
    	
 
    	
17
    
	
 
    	
 
    	
 
    
	
12.  Change   of Control
    	
 
    	
17
    
	
 
    	
 
    	
 
    
	
13.    Amendment, Modification, and Termination
    	
 
    	
18
    
	
 
    	
 
    	
 
    
	
14.    Withholding
    	
 
    	
19
    
	
 
    	
 
    	
 
    
	
15.    Successors
    	
 
    	
20
    
	
 
    	
 
    	
 
    
	
16.    Additional Provisions
    	
 
    	
20
    

 

 

Janus Capital Group Inc.

2012Employment Inducement Award Plan

 

(AS ADOPTED EFFECTIVE AS OF January 24, 2012

AND AMENDED AND RESTATED EFFECTIVE AS OF NOVEMBER 28, 2014)

 

Article 1.   History, Effective Date, Objectives and Duration

 

1.1          History.  Janus Capital Group Inc., a Delaware corporation (the “Company”), has established the Janus Capital Group Inc. 2012 Employment Inducement Award Plan, as set forth herein, and as the same may be amended from time to time (the “Plan”).  The Plan was adopted by the Compensation Committee of the Board of Directors of the Company on December 28, 2011, and was ratified by the Board of Directors of the Company (the “Board”) on January 24, 2012, to be effective on January 24, 2012 (the “Effective Date”).  The plan was amended and restated effective November 28, 2014 to update the number of shares authorized for issuance and to provide the Committee with additional flexibility in determining the terms and conditions of Grantees’ Awards, consistent with the objectives and provisions of the Plan.

 

1.2          Objectives of the Plan.  The Plan is intended to assist the Company and its Subsidiaries in attracting new employees, and to allow new employees of the Company and its Subsidiaries to acquire equity ownership in the Company, thereby strengthening their commitment to the success of the Company and stimulating their efforts on behalf of the Company.  The Plan also is intended to optimize the profitability and growth of the Company through incentives which are consistent with the Company’s goals; to provide new employees with an incentive for excellence in individual performance; and to promote teamwork among employees.  To achieve these objectives, the Plan is intended to provide only Awards that constitute Employment Inducement Awards.

 

1.3          Duration of the Plan.  The Plan shall commence on the Effective Date and shall remain in effect, subject to the right of the Board or the Plan Committee to amend or terminate the Plan at any time pursuant to Article 13 hereof, until all Shares subject to it shall have been purchased or acquired according to the Plan’s provisions.

 

Article 2.   Definitions

 

Whenever used in the Plan, the following terms shall have the meanings set forth below:

 

2.1          “Article” means an Article of the Plan.

 

2.2          “Award” means Options, Restricted Shares (awarded as Shares or Share Units), or Dividend Equivalents granted under the Plan.

 

2.3          “Award Agreement” means the written agreement by which an Award shall be evidenced.

 

2.4          “Board” has the meaning set forth in Section 1.1.

 

 

2.5          Intentionally Omitted

 

2.6          “Cause” means, unless otherwise defined in an Award Agreement,

 

(a)           before the occurrence of a Change of Control, any one or more of the following, as determined by the Committee:

 

(1)           a Grantee’s commission of a crime which, in the judgment of the Committee, resulted or is likely to result in damage or injury to the Company or a Subsidiary;

 

(2)           the material violation by the Grantee of written policies of the Company or a Subsidiary;

 

(3)           the habitual neglect or failure by the Grantee in the performance of his or her duties to the Company or a Subsidiary (but only if such neglect or failure is not remedied within a reasonable remedial period after Grantee’s receipt of written notice from the Company which describes such neglect or failure in reasonable detail and specifies the remedial period); or

 

(4)           action or inaction by the Grantee in connection with his or her duties to the Company or a Subsidiary resulting, in the judgment of the Committee, in material injury to the Company or a Subsidiary; and

 

(b)           from and after the occurrence of a Change of Control, the occurrence of any one or more of the following, as determined in the good faith and reasonable judgment of the Committee:

 

(1)           Grantee’s conviction for committing an act of fraud, embezzlement, theft, or any other act constituting a felony involving moral turpitude or causing material damage or injury, financial or otherwise, to the Company;

 

(2)           a demonstrably willful and deliberate act or failure to act which is committed in bad faith, without reasonable belief that such action or inaction is in the best interests of the Company, which causes material damage or injury, financial or otherwise, to the Company (but only if such act or inaction is not remedied within 15 business days of Grantee’s receipt of written notice from the Company which describes the act or inaction in reasonable detail); or

 

(3)           the consistent gross neglect of duties or consistent wanton negligence by the Grantee in the performance of the Grantee’s duties (but only if such neglect or negligence is not remedied within a reasonable remedial period after Grantee’s receipt of written notice from the Company which describes such neglect or negligence in reasonable detail and specifies the remedial period).

 

2

 

2.7          “Change of Control” shall, unless otherwise defined in the Award Agreement, be deemed to have occurred if the event set forth in any one of the following paragraphs shall have occurred:

 

(a)           a change in the composition of the Board such that the individuals who, as of the effective date of the this Agreement, constitute the Board (such Board shall be hereinafter referred to as the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, for purposes of this definition, that any individual who becomes a member of the Board subsequent to the effective date hereof, whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of those individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to this proviso) shall be considered as though such individual were a member of the Incumbent Board; but, provided further, that any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act, as modified) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board shall not be so considered as a member of the Incumbent Board; or

 

(b)           consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of the assets or stock of another entity (“Business Combination”); excluding, however, such a Business Combination pursuant to which (1) all or substantially all of the individuals and entities who are the beneficial owners, respectively, of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination will beneficially own, directly or indirectly, more than 50 percent of, respectively, the outstanding shares of common stock, and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Business Combination (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; and (2)  individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Business Combination; or

 

(c)           the approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

Notwithstanding (a), (b) and (c) above, that for each Award subject to Section 409A of the Code, a Change of Control shall be deemed to have occurred under this Plan with respect to such Award only if a change in the ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company shall also be deemed to have occurred under Section 409A of the Code.

 

3

 

2.8          “Change of Control Value” means the Fair Market Value of a Share on the date of a Change of Control.

 

2.9          “Code” means the Internal Revenue Code of 1986, as amended from time to time, and regulations and rulings thereunder.  References to a particular section of the Code include references to successor provisions of the Code or any successor code

 

2.10        “Committee,” “Plan Committee” and “Management Committee” have the meanings set forth in Article 3.

 

2.11        “Common Stock” means the common stock, $.01 par value, of the Company.

 

2.12        “Company” has the meaning set forth in Section 1.1.

 

2.13        “Disability” means, unless otherwise defined in the Award Agreement, that a Grantee (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company or a Subsidiary of the Company.

 

2.14        “Dividend Equivalents” has the meaning set forth in Section 11.3.

 

2.15        “Effective Date” has the meaning set forth in Section 1.1.

 

2.16-A    “Eligible Person” means any employee (including any officer) of the Company or any Subsidiary who is determined by the Committee to be eligible for an Employment Inducement Award, including any such employee who is on an approved leave of absence, layoff, or has been subject to a disability which does not qualify as a Disability.

 

2.16-B    “Employment Inducement Award” means an Award to a Grantee that is determined by the Committee to qualify as an employment inducement award within the meaning of New York Stock Exchange Rule 303A.08 (or any successor rule relating to shareholder approval of equity compensation plans that includes an exemption for such awards and that is applicable to the Company).

 

2.17        “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.  References to a particular section of the Exchange Act include references to successor provisions.

 

2.18        “Fair Market Value” means (A) with respect to any property other than Shares, the fair market value of such property determined by such methods or procedures as shall be established from time to time by the Committee, and (B) with respect to Shares, unless otherwise determined by

 

4

 

the Committee, as of any date, (i) the average of the high and low trading prices on the date of determination on the New York Stock Exchange (or, if no sale of Shares was reported for such date, on the next preceding date on which a sale of Shares was reported); (ii) if the Shares are not listed on the New York Stock Exchange, the average of the high and low trading prices of the Shares on such other national exchange on which the Shares are principally traded or as reported by the National Market System, or similar organization, or if no such quotations are available, the average of the high bid and low asked quotations in the over-the-counter market as reported by the National Quotation Bureau Incorporated or similar organizations; or (iii) in the event that there shall be no public market for the Shares, the fair market value of the Shares as determined by the Committee.

 

2.19        “Freestanding SAR” means an SAR that is granted independently of any other Award.

 

2.20        “Good Reason” shall have the meaning assigned to such term in the Grantee’s individual employment or severance agreement or, if the Grantee is not a party to an agreement in which Good Reason is defined, Good Reason shall mean the occurrence of any of the events or conditions described below which are not cured by the Company (if susceptible to cure by the Company) within thirty (30) days after the Company has received written notice from the Grantee (which notice must be provided by the Grantee within ninety (90) days of the initial existence of the event or condition constituting Good Reason): (i) a material adverse alteration in the nature or status of the Grantee’s responsibilities from those in effect immediately prior to the Change in Control other than any such alteration primarily attributable to the fact that the Company may no longer be a public company or to other changes in the identity, nature or structure of the Company; and provided, that a change in the Grantee’s title or reporting relationships shall not of itself constitute Good Reason (unless such change results in a material adverse alteration as described above), (ii) any material reduction in the Grantee’s base salary except for any across-the-board reduction similarly affecting similarly-situated employees of the Company, or (iii) the relocation of the Grantee’s principal place of employment to a location more than 40 miles from the Grantee’s principal place of employment immediately prior to the Change of Control, provided that such relocation results in a material negative change to the Grantee’s employment.

 

2.21        “Grant Date” has the meaning set forth in Section 5.2.

 

2.22        “Grantee” means an individual who has been granted an Award.

 

2.23        “including” or “includes” means “including, without limitation,” or “includes, without limitation,” respectively.

 

2.24        “Option” means an option granted under Article 6 of the Plan.

 

2.25        “Option Price” means the price at which a Share may be purchased by a Grantee pursuant to an Option.

 

5

 

2.26        “Option Term” means the period beginning on the Grant Date of an Option and ending on the expiration date of such Option, as specified in the Award Agreement for such Option and as may, consistent with the provisions of the Plan, be extended from time to time by the Committee prior to the expiration date of such Option then in effect.

 

2.27        “Performance Period” has the meaning set forth in Section 7.2.

 

2.28        “Period of Restriction” means the period during which the transfer of Restricted Shares is limited in some way (the length of the period being based on the passage of time, the achievement of performance goals, or upon the occurrence of other events as determined by the Committee), and the Shares are subject to a substantial risk of forfeiture, as provided in Article 8.

 

2.29        “Person” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d) thereof.

 

2.30        “Plan” has the meaning set forth in Section 1.1.

 

2.31        “Required Withholding” has the meaning set forth in Article 16.

 

2.32        “Restricted Shares” means Shares or Share Units that are subject to forfeiture if the Grantee does not satisfy the conditions specified in the Award Agreement applicable to such Shares or Share Units.

 

2.33        “Retirement” means, unless otherwise defined in the Award Agreement, a Grantee’s Termination of Affiliation upon having (A) both attained age fifty-five (55) and completed at least ten (10) years of service with the Company or a Subsidiary, or (B) attained age sixty (60).

 

2.34        “Rule 16b-3” means Rule 16b-3 promulgated by the SEC under the Exchange Act, as amended from time to time, together with any successor rule, as in effect from time to time.

 

2.35        “SAR” means a stock appreciation right.

 

2.36        “SEC” means the United States Securities and Exchange Commission, or any successor thereto.

 

2.37        “Section” means, unless the context otherwise requires, a Section of the Plan.

 

2.38        “Section 16 Person” means a person who is subject to potential liability under Section 16(b) of the 1934 Act with respect to transactions involving equity securities of the Company.

 

2.39        “Share” means a share of Common Stock.

 

2.40        “Share Unit” means a bookkeeping entry representing the equivalent of one share of Common Stock that is payable in the form of Common Stock unless at the time of grant the Plan

 

6

 

Committee or the Board designates it to be paid in cash or any combination of cash and Common Stock.

 

2.41        “Strike Price” of any SAR shall equal, for any Tandem SAR (whether such Tandem SAR is granted at the same time as or after the grant of the related Option), the Option Price of such Option, or for any other SAR, 100% of the Fair Market Value of a Share on the Grant Date of such SAR; provided that the Committee may specify a higher Strike Price in the Award Agreement.

 

2.42        “Subsidiary” means a United States or foreign corporation or limited liability company, partnership or other similar entity with respect to which the Company owns, directly or indirectly, 50% or more of the Voting Power of such corporation, limited liability company, partnership or other similar entity

 

2.43        “Tandem SAR” means an SAR that is granted in connection with a related Option, the exercise of which shall require cancellation of the right to purchase a Share under the related Option (and when a Share is purchased under the related Option, the Tandem SAR shall similarly be canceled).

 

2.44        “Termination of Affiliation” occurs on the first day on which an individual is for any reason no longer providing services to the Company or any Subsidiary in the capacity of an employee, director or consultant, or with respect to an individual who is an employee or director of, or consultant to, a corporation which is a Subsidiary, the first day on which such corporation ceases to be a Subsidiary; provided, however, that for each Award subject to Section 409A of the Code, a Termination of Affiliation shall be deemed to have occurred under this Plan with respect to such Award on the first day on which an individual has experienced a “separation from service” within the meaning of Section 409A of the Code.

 

2.45        “Voting Power” means the combined voting power of the then-outstanding securities of a corporation entitled to vote generally in the election of directors.

 

Article 3.   Administration

 

3.1          Committee

 

(a)           Subject to Article 13, and to Section 3.2, the Plan shall be administered by the Board, or a committee appointed by the Board to administer the Plan (“Plan Committee”).  To the extent the Board considers it desirable to comply with or qualify under Rule 16b-3, the Plan Committee shall consist of two or more directors of the Company, all of whom qualify as “non-employee directors” within the meaning of Rule 16b-3.  The number of members of the Plan Committee shall from time to time be increased or decreased, and shall be subject to such conditions, in each case as the Board deems appropriate to permit transactions in Shares pursuant to the Plan to satisfy such conditions of Rule 16b-3 as then in effect.

 

(b)           The Board or the Plan Committee may appoint and delegate to another committee (“Management Committee”) any or all of the authority of the Board or the Plan

 

7

 

Committee, as applicable, with respect to Awards to Grantees other than Grantees who are Section 16 Persons at the time any such delegated authority is exercised.

 

(c)           Any references herein to “Committee” are references to the Board, or the Plan Committee or the Management Committee, as applicable.

 

3.2          Powers of Committee

 

Subject to the express provisions of the Plan, the Committee has full and final authority and sole discretion as follows:

 

(a)           to determine when, to whom and in what types and amounts Awards should be granted and the terms and conditions applicable to each Award and whether or not specific Awards shall be granted in connection with other specific Awards, and if so whether they shall be exercisable cumulatively with, or alternatively to, such other specific Awards;

 

(b)           to determine the amount, if any, that a Grantee shall pay for Restricted Shares, whether to permit or require the payment of cash dividends thereon to be deferred and the terms related thereto, when Restricted Shares (including Restricted Shares acquired upon the exercise of an Option) shall be forfeited and whether such shares shall be held in escrow;

 

(c)           to construe and interpret the Plan and to make all determinations necessary or advisable for the administration of the Plan;

 

(d)           to make, amend, and rescind rules relating to the Plan, including rules with respect to the exercisability and non-forfeitability of Awards upon the Termination of Affiliation of a Grantee;

 

(e)           to determine the terms and conditions of all Award Agreements (which need not be identical) and, with the consent of the Grantee, to amend any such Award Agreement at any time, among other things, to permit transfers of such Awards to the extent permitted by the Plan; provided that the consent of the Grantee shall not be required for any amendment which (i) does not adversely affect the rights of the Grantee, or (ii) is necessary or advisable (as determined by the Committee) to carry out the purpose of the Award as a result of any new or change in existing applicable law;

 

(f)            to cancel, with the consent of the Grantee, outstanding Awards and to grant new Awards in substitution therefore;

 

(g)           to accelerate the exercisability (including exercisability within a period of less than six months after the Grant Date) or the vesting of, and to accelerate or waive any or all of the terms and conditions applicable to, any Award or any group of Awards for any reason and at any time, including in connection with a Termination of Affiliation;

 

8

 

(h)                            subject to Sections 1.3 and 5.3, to extend the time during which any Award or group of Awards may be exercised;

 

(i)                                to make such adjustments or modifications to Awards to Grantees working outside the United States as are advisable to fulfill the purposes of the Plan or to comply with applicable local law;

 

(j)                               to impose such additional terms and conditions upon the grant, exercise or retention of Awards as the Committee may, before or concurrently with the grant thereof, deem appropriate, including limiting the percentage of Awards which may from time to time be exercised by a Grantee;

 

(k)                            to ensure that any Award granted under the Plan qualifies as an Employment Inducement Award; and

 

(l)                                to take any other action with respect to any matters relating to the Plan for which it is responsible.

 

All determinations on all matters relating to the Plan or any Award Agreement may be made in the sole and absolute discretion of the Committee, and all such determinations of the Committee shall be final, conclusive and binding on all Persons.  No member of the Committee shall be liable for any action or determination made with respect to the Plan or any Award.

 

Article 4.   Shares Subject to the Plan and Maximum Awards

 

4.1                            Number of Shares Available for Grants.  Subject to adjustment as provided in Section 4.2, the number of Shares hereby reserved for issuance under the Plan shall be 2,000,000.  If any Shares subject to an Award granted hereunder are forfeited, terminated, expired or canceled or such Award otherwise terminates without the issuance of such Shares or of other consideration in lieu of such Shares, the Shares subject to such Award, to the extent of any such forfeiture, termination, expiration or cancellation shall again be available for grant under the Plan (without a charge against the aggregate number of Shares available for issuance hereunder).  Notwithstanding the foregoing, Shares surrendered or withheld as payment of either the Strike Price of an Award (including Shares otherwise underlying an Award of a SAR that are retained by the Company to account for the grant price of such SAR) and/or withholding taxes in respect of an Award shall no longer be available for grant under the Plan.  The Committee may from time to time determine the appropriate methodology for calculating the number of Shares issued pursuant to the Plan.  Shares issued pursuant to the Plan may be treasury Shares or newly-issued Shares.

 

4.2                            Adjustments in Authorized Shares.  In the event that the Committee determines that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, subdivision, consolidation or reduction of capital, reorganization, merger, scheme of arrangement, split-up, spin-off or combination involving the Company or repurchase or exchange of Shares or other rights to purchase Shares or other securities of the Company, or other similar corporate transaction or event affects the Shares such

 

9

 

that any adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Shares (or other securities or property) with respect to which Awards may be granted, (ii) the number and type of Shares (or other securities or property) subject to outstanding Awards, and (iii) the grant or exercise price with respect to any Award or, if deemed appropriate, cancel an outstanding Award, in exchange for a cash payment to the holder of an outstanding Award or the substitution of other property for Shares subject to an outstanding Award; provided, that the number of Shares subject to any Award denominated in Shares shall always be a whole number.

 

Article 5.   Eligibility and General Conditions of Awards

 

5.1                            Eligibility.  The Committee may grant Awards to any Eligible Person, whether or not he or she has previously received an Award.

 

5.2                            Grant Date.  The Grant Date of an Award shall be the date on which the Committee grants the Award or such later date as specified by the Committee.

 

5.3                            Maximum Term.  The Option Term or other period during which an Award may be outstanding shall under no circumstances extend more than 10 years after the Grant Date, and shall be subject to earlier termination as herein provided.

 

5.4                            Award Agreement.  To the extent not set forth in the Plan, the terms and conditions of each Award (which need not be the same for each grant or for each Grantee) shall be set forth in an Award Agreement.

 

5.5                            Restrictions on Share Transferability.  The Committee may impose such restrictions on any Shares acquired pursuant to the exercise or vesting of an Award as it may deem advisable, including restrictions under applicable federal securities laws.

 

5.6                            Termination of Affiliation.  Except as otherwise provided by the Committee or in an Award Agreement, and subject to the provisions of Section 12.1, the extent to which the Grantee shall have the right to exercise, vest in, or receive payment in respect of an Award following Termination of Affiliation shall be determined in accordance with the following provisions of this Section 5.6.

 

(a)                            For Cause.  If a Grantee has a Termination of Affiliation for Cause, (i) the Grantee’s Restricted Shares that are forfeitable shall thereupon be forfeited, subject to the provisions of Section 8.4 regarding repayment of certain amounts to the Grantee; and (ii) any unexercised Option, or SAR shall terminate effective immediately upon such Termination of Affiliation.

 

(b)                            On Account of Death or Disability.  If a Grantee has a Termination of Affiliation on account of death or Disability, then:

 

10

 

(1)                       the Grantee’s Restricted Shares that were forfeitable shall thereupon become non-forfeitable; and

 

(2)                       any unexercised Option or SAR, whether or not exercisable on the date of such Termination of Affiliation, may be exercised, in whole or in part, within the first 12 months after such Termination of Affiliation (but only during the Option Term) and shall terminate immediately thereafter; such Option or SAR may be exercised to the extent permitted under this section by the Grantee or, after his or her death, by (i) his or her personal representative or the person to whom the Option or SAR, as applicable, is transferred by will or the applicable laws of descent and distribution, or (ii) the Grantee’s beneficiary designated in accordance with Article 11.

 

(c)                             On Account of Retirement.  Upon Grantee’s Retirement, then:

 

(1)                       the Grantee’s Restricted Shares that were forfeitable shall thereupon become non-forfeitable; and

 

(2)                       any unexercised Option or SAR, whether or not exercisable on the date of such Termination of Affiliation, may be exercised, in whole or in part, within the first five years after such Termination of Affiliation (but only during the Option Term) and shall terminate immediately thereafter; such Option or SAR may be exercised to the extent permitted under this section by the Grantee or, after his or her death, by (i) his or her personal representative or the person to whom the Option or SAR, as applicable, is transferred by will or the applicable laws of descent and distribution, or (ii) the Grantee’s beneficiary designated in accordance with Article 11.

 

(d)                            Any Other Reason.  If a Grantee has a Termination of Affiliation for any reason other than for Cause, death, Disability or Retirement, then:

 

(1)                       the Grantee’s Restricted Shares, to the extent forfeitable on the date of the Grantee’s Termination of Affiliation, shall be forfeited on such date;

 

(2)                       if such Termination of Affiliation is the result of the Grantee’s voluntary termination of employment, any unexercised Option or SAR, to the extent not exercisable immediately before the Grantee’s Termination of Affiliation shall terminate immediately upon such Termination of Affiliation, and to the extent exercisable immediately before the Grantee’s Termination of Affiliation, may be exercised in whole or in part, not later than three months after such Termination of Affiliation (but only during the Option Term) and shall terminate immediately thereafter; such Option or SAR may be exercised to the extent permitted under this section by the Grantee or, after his or her death, by (i) his or her personal representative or the person to whom the Option or SAR, as applicable, is transferred by will or the applicable laws of descent and distribution, or (ii) the Grantee’s beneficiary designated in accordance with Article 11; and

 

11

 

(3)                       if such Termination of Affiliation is the result of the Grantee’s termination of employment by the Company or a Subsidiary (other than for Cause), then, the portion of any Option that was not exercisable immediately before the Grantee’s Termination of Affiliation, may be exercised in whole or in part, not later than three months after such Termination of Affiliation (but only during the Option Term) and shall terminate immediately thereafter; such Option or SAR may be exercised to the extent permitted under this section by the Grantee or, after his or her death, by (i) his or her personal representative or the person to whom the Option is transferred by will or the applicable laws of descent and distribution, or (ii) the Grantee’s beneficiary designated in accordance with Article 11.

 

5.7                             Non-transferability of Awards.

 

(a)                            Except as provided in Section 5.7(c) below or as otherwise determined by the Committee, each Award, and each right under any Award, shall be exercisable only by the Grantee during the Grantee’s lifetime, or, if permissible under applicable law, by the Grantee’s guardian or legal representative.

 

(b)                            Except as provided in Section 5.7(c) below or as otherwise determined by the Committee, no Award (prior to the time, if applicable, Shares are issued in respect of such Award), and no right under any Award, may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Grantee otherwise than by will or by the laws of descent and distribution (or in the case of Restricted Shares, to the Company), and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Subsidiary; provided, that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.

 

(c)                             To the extent and in the manner permitted by the Committee, and subject to such terms, conditions, restrictions or limitations that may be prescribed by the Committee, a Grantee may transfer an Award to (i) a spouse, sibling, parent, child (including an adopted child) or grandchild (any of which, an “Immediate Family Member”) of the Grantee; (ii) a trust, the primary beneficiaries of which consist exclusively of the Grantee or Immediate Family Members of the Grantee; or (iii) a corporation, partnership or similar entity, the owners of which consist exclusively of the Grantee or Immediate Family Members of the Grantee.

 

5.8                            Cancellation and Rescission of Awards.  Unless the Award Agreement specifies otherwise, the Committee may cancel, rescind, suspend, withhold, or otherwise limit or restrict any unexercised Award at any time if the Grantee is not in compliance with all applicable provisions of the Award Agreement and the Plan or if the Grantee has a Termination of Affiliation for Cause.

 

5.9                            Loans and Guarantees.  The Committee may, subject to applicable law, (i) allow a Grantee to defer payment to the Company of all or any portion of the Option Price of an Option or the purchase price of Restricted Shares, or (ii) cause the Company to loan to the Grantee, or guarantee a loan from a third party to the Grantee for, all or any portion of the Option Price of an Option or the purchase price of Restricted Shares or all or any portion of any taxes associated with

 

12

 

the exercise of, non-forfeitability of, or payment of benefits in connection with, an Award.  Any such payment deferral, loan or guarantee by the Company shall be on such terms and conditions as the Committee may determine. Notwithstanding the foregoing, the Company shall not loan to the Grantee, or guarantee a loan from a third party to the Grantee, as described in the preceding sentence, if such loan is prohibited under Section 402 of the Sarbanes-Oxley Act of 2002, as may be amended.

 

Article 6.  Stock Options

 

6.1                            Grant of Options.  Subject to the terms and provisions of the Plan, Options may be granted to any Eligible Person in such number, and upon such terms, and at any time and from time to time as shall be determined by the Committee.  Without in any manner limiting the generality of the foregoing, and in a manner intended to comply with Section 409A of the Code, the Committee may grant to any Eligible Person, or permit any Eligible Person to elect to receive, an Option in lieu of or in substitution for any other compensation (whether payable currently or on a deferred basis, and whether payable under this Plan or otherwise) which such Eligible Person may be eligible to receive from the Company or a Subsidiary.

 

6.2                            Award Agreement.  Each Option grant shall be evidenced by an Award Agreement that shall specify the Option Price, the Option Term, the number of shares to which the Option pertains, the time or times at which such Option shall be exercisable and such other provisions as the Committee shall determine.

 

6.3                            Option Price.  The Option Price of an Option under this Plan shall be determined by the Committee, and shall be equal to or more than 100% of the Fair Market Value of a Share on the Grant Date; provided, however, that any Option that is (x) granted to a Grantee in connection with the acquisition (“Acquisition”), however effected, by the Company of another corporation or entity (“Acquired Entity”) or the assets thereof, (y) associated with an option to purchase shares of stock of the Acquired Entity or an affiliate thereof (“Acquired Entity Option”) held by such Grantee immediately prior to such Acquisition, and (z) intended to preserve for the Grantee the economic value of all or a portion of such Acquired Entity Option (“Substitute Option”) may, to the extent necessary to achieve such preservation of economic value, be granted with an Option Price that is less than 100% of the Fair Market Value of a Share on the Grant Date, provided that such grant is made in a manner that will not result in the Substitute Option being subject to the requirements of Section 409A of the Code..

 

6.4                            Incentive Stock Options.  None of the Options granted under this Plan shall be treated as “incentive stock options” for purposes of the requirements of Section 422 of the Code.

 

6.5                            Payment.  Options granted under this Article 6 shall be exercised by the delivery of a written notice of exercise to the Company, setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares made by any one or more of the following means subject to the approval of the Committee:

 

(a)                            cash, personal check or wire transfer;

 

13

 

(b)                            Shares, valued at their Fair Market Value on the date of exercise;

 

(c)                             Restricted Shares, each such Share valued at the Fair Market Value of a Share on the date of exercise;

 

(d)                            subject to applicable law, pursuant to procedures approved by the Committee, through the sale of the Shares acquired on exercise of the Option, valued at their Fair Market Value on the date of exercise, sufficient to pay for such Shares, together with, if requested by the Company, the amount of federal, state, local or foreign withholding taxes payable by Grantee by reason of such exercise; or

 

(e)                             when permitted by the Committee, payment may also be made in accordance with Section 5.9.

 

If any Restricted Shares (“Tendered Restricted Shares”) are used to pay the Option Price, a number of Shares acquired on exercise of the Option equal to the number of Tendered Restricted Shares shall be subject to the same restrictions as the Tendered Restricted Shares, determined as of the date of exercise of the Option.

 

Article 7.   Stock Appreciation Rights

 

7.1                            Grant of SARs.  Subject to the terms and conditions of the Plan, SARs may be granted to any Eligible Person at any time and from time to time as shall be determined by the Committee.  The Committee may grant Freestanding SARs, Tandem SARs, or any combination thereof.

 

The Committee shall determine the number of SARs granted to each Grantee (subject to Article 4), the Strike Price thereof, and, consistent with Section 7.2 and the other provisions of the Plan, the other terms and conditions pertaining to such SARs.  The Strike Price shall be determined by the Committee, and shall be equal to or more than 100% of the Fair Market Value of a Share on the Grant Date; provided, however, that an Option that is (x) granted to a Grantee in connection with the acquisition (“Acquisition”), however effected, by the Company of another corporation or entity (“Acquired Entity”) or the assets thereof, (y) associated with an option to purchase shares of stock of the Acquired Entity” or an affiliate thereof (“Acquired Entity Option”) held by such Grantee immediately prior to such Acquisition, and (z) intended to preserve for the Grantee the economic value of all or a portion of such Acquired Entity Option (“Substitute Option”) may, to the extent necessary to achieve such preservation of economic value, be granted with an option price that is less than 100% of the Fair Market Value of a Share on the Grant Date, provided that such grant is made in a manner that will not result in the Substitute Option being subject to the requirements of Section 409A of the Code.

 

7.2                            Exercise of Tandem SARs.  Tandem SARs may be exercised for all or part of the Shares subject to the related Award upon the surrender of the right to exercise the equivalent portion

 

14

 

of the related Award.  A Tandem SAR may be exercised only with respect to the Shares for which its related Award is then exercisable.

 

Notwithstanding any other provision of this Plan to the contrary, with respect to a Tandem SAR, (i) the Tandem SAR will expire no later than the expiration of the underlying Option; (ii) the value of the payout with respect to the Tandem SAR may be for no more than 100% of the difference between the Option Price of the underlying Option and the Fair Market Value of the Shares subject to the underlying Option at the time the Tandem SAR is exercised; and (iii) the Tandem SAR may be exercised only when the Fair Market Value of the Shares subject to the Option exceeds the Option Price of the Option.

 

7.3                            Payment of SAR Amount.  Upon exercise of an SAR, the Grantee shall be entitled to receive payment from the Company in an amount determined by multiplying:

 

(a)                            the excess of the Fair Market Value of a Share on the date of exercise over the Strike Price;

 

by

 

(b)                            the number of Shares with respect to which the SAR is exercised;

 

provided that the Committee may provide in the Award Agreement that the benefit payable on exercise of an SAR shall not exceed such percentage of the Fair Market Value of a Share on the Grant Date as the Committee shall specify.  As provided by the Committee, the payment upon SAR exercise shall either be in cash or in Shares which have an aggregate Fair Market Value (as of the date of exercise of the SAR) equal to the amount of the payment, or in some combination thereof, as set forth in the Award Agreement.

 

Article 8.   Restricted Shares

 

8.1                            Grant of Restricted Shares.  Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Restricted Shares to any Eligible Person in such amounts as the Committee shall determine including, with respect to each Restricted Share that is also a Share Unit, the time and form of payment of such Restricted Share; provided, however, that with respect to Restricted Shares that are also Share Units, if such Share Units would be subject to Section 409A of the Code, the provisions of such Share Unit shall comply with the requirements set forth in Section 409A of the Code..

 

8.2                            Award Agreement.  Each grant of Restricted Shares shall be evidenced by an Award Agreement that shall specify the Period(s) of Restriction, the number of Restricted Shares granted, and such other provisions as the Committee shall determine.  The Committee may impose such conditions and/or restrictions on any Restricted Shares granted pursuant to the Plan as it may deem advisable, including restrictions based upon the achievement of specific performance goals (Company-wide, divisional, Subsidiary and/or individual), time-based restrictions on vesting, and/or restrictions under applicable securities laws.

 

15

 

8.3                            Consideration.  The Committee shall determine the amount, if any, that a Grantee shall pay for Restricted Shares.  Such payment shall be made in full by the Grantee before the delivery of the shares or share units and in any event no later than 10 business days after the Grant Date for such shares or share units.

 

8.4                            Effect of Forfeiture.  Unless otherwise provided in the Award Agreement, if Restricted Shares are forfeited, and if the Grantee was required to pay for such shares or share units or acquired such Restricted Shares upon the exercise of an Option, the Grantee shall be deemed to have resold such Restricted Shares to the Company at a price equal to the lesser of (x) the amount paid by the Grantee for such Restricted Shares, or (y) the Fair Market Value of a Share or Share Unit on the date of such forfeiture. The Company shall pay to the Grantee the required amount as soon as is administratively practical. Such Restricted Shares shall cease to be outstanding, and shall no longer confer on the Grantee thereof any rights as a stockholder of the Company, from and after the date of the event causing the forfeiture, whether or not the Grantee accepts the Company’s tender of payment for such Restricted Shares.

 

8.5                            Escrow; Legends.  The Committee may provide that any certificates for Restricted Shares (x) shall be held (together with a stock power executed in blank by the Grantee) in escrow by the Secretary of the Company until such Restricted Shares become non-forfeitable or are forfeited and/or (y) shall bear an appropriate legend restricting the transfer of such Restricted Shares.  If any Restricted Shares become non-forfeitable, the Company shall cause any certificates for such shares to be issued without such legend.

 

Article 9.   Beneficiary Designation

 

Each Grantee under the Plan may, from time to time, name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid in case of his or her death before he or she receives any or all of such benefit.  Each such designation shall revoke all prior designations by the same Grantee, shall be in a form prescribed by the Company, and will be effective only when filed by the Grantee in writing with the Company during the Grantee’s lifetime.  In the absence of any such designation, benefits remaining unpaid at the Grantee’s death shall be paid to the Grantee’s estate.

 

16

 

Article 10.                  Deferrals

 

The Committee may permit or require a Grantee to defer receipt of the payment of cash or the delivery of Shares that would otherwise be due by virtue of the exercise of an Option or SAR, the lapse or waiver of restrictions with respect to Restricted Shares.  If any such deferral is required or permitted, the Committee shall establish rules and procedures for such deferrals; provided, however, to the extent that such deferral is subject to Section 409A of the Code, the rules and procedures established by the Committee shall comply with Section 409A of the Code.  Except as otherwise provided in an Award Agreement, any payment or any Shares that are subject to such deferral shall be made or delivered to the Grantee upon the Grantee’s Termination of Affiliation.

 

Article 11.                       Rights of Employees

 

11.1                     Employment.  Nothing in the Plan shall interfere with or limit in any way the right of the Company to terminate any Grantee’s employment, directorship or consultancy at any time, nor confer upon any Grantee the right to continue in the employ or as a director or consultant of the Company.

 

11.2                     Participation.  No employee shall have the right to be selected to receive an Award under the Plan or, having been so selected, to be selected to receive a future Award.

 

11.3                     Dividend Equivalents.  Subject to the provisions of the Plan and any Award, the recipient of an Award (including any Award deferred in accordance with procedures established pursuant to Article 12) may, if so determined by the Committee, be entitled to receive, currently or on a deferred basis, cash, stock or other property dividends, or cash payments in amounts equivalent to cash, stock or other property dividends on shares of Common Stock (“Dividend Equivalents”) with respect to the number of shares of Common Stock covered by the Award, as determined by the Committee, in its sole discretion, and the Committee may provide that such amounts (if any) shall be deemed to have been reinvested in additional shares or otherwise reinvested; provided, however, that if such payment of dividends or Dividend Equivalents would be subject to Section 409A of the Code, no such payment may be made if it would fail to comply with the requirements set forth in Section 409A of the Code.  Notwithstanding the foregoing, no dividends or Dividend Equivalents will be paid with respect to unvested Performance Units or Performance Awards.

 

Article 12.                       Change of Control

 

General Rules.  Except as otherwise provided in an Award Agreement or determined by the Committee at the time an Award is granted, if a Change of Control occurs, then:

 

(a)                            Following a Change of Control, each outstanding Award shall remain outstanding and shall continue to vest in accordance with its terms (subject to adjustment in accordance with Section 4.2 hereof); provided, however, that, in the event of a termination of a Grantee’s employment or service by the Company without Cause or for Good Reason during the 

 

17

 

24-month period following such Change of Control, on the date of such termination (i) such Award shall become fully vested and, if applicable, exercisable, (ii) the restrictions, payment conditions, and forfeiture conditions applicable to any such Award granted shall lapse, and (iii) any performance conditions imposed with respect to Awards shall be deemed to be fully achieved at target levels.

 

(b)                            Notwithstanding the foregoing or any other provision of the Plan or any applicable Award Agreement, in the event of a Change of Control (except as would otherwise result in adverse tax consequences under Section 409A of the Code), the Committee may, in its sole discretion, provide that each Award shall, immediately upon the occurrence of a Change of Control, be cancelled in exchange for a payment to the Grantee in cash in an amount equal to (x) the excess of the consideration paid per Share in the Change of Control over the exercise or purchase price (if any) per Share as subject to the Award multiplied by (y) the number of Shares granted under the Award.  Where such acceleration would result in adverse tax consequences under Section 409A of the Code with respect to an award, the Committee may, in its sole discretion, provide that such Award shall become vested and non-forfeitable upon the occurrence of the Change of Control; provided, however, that the Grantee shall not be able to exercise the Award, and the Award shall not become payable, except in accordance with the terms of such Award or until such earlier time as the exercise and/or payment complies with Section 409A of the Code.

 

Article 13.                       Amendment, Modification, and Termination

 

13.1                     Amendment, Modification, and Termination.  Subject to the terms of the Plan, the Board may at any time and from time to time, alter, amend, suspend or terminate the Plan in whole or in part.  To the extent applicable and required by the New York Stock Exchange (or such other exchange upon which the Company lists its shares for trading) or any other applicable law, rule or regulation, no amendment and no transaction that would constitute a repricing shall be effective unless approved by the Company’s stockholders.  Except in connection with a corporate transaction involving the Company (including, without limitation, any stock dividend, stock split, extraordinary cash dividend, recapitalization, reorganization, merger, consolidation, split-up, spin-off, combination, or exchange of shares), the terms of outstanding awards may not be amended to reduce the exercise price of outstanding Options or SARs or cancel outstanding Options or SARS in exchange for cash, other awards or Options or SARs with an exercise price that is less than the exercise price of the original Options or SARs without stockholder approval.  The Board may delegate to the Plan Committee any or all of the authority of the Board under Section 13.1 to alter, amend, suspend or terminate the Plan.

 

13.2                     Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events.  The Committee may make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (including the events described in Section 4.2) affecting the Company or the financial statements of the Company or of changes in applicable laws, regulations, or accounting principles, whenever the Committee determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan; provided that no such 

 

18

 

adjustment shall be authorized to the extent that such authority would be inconsistent with the Plan’s meeting the requirements of the Performance-Based Exception.

 

13.3                     Awards Previously Granted.  Notwithstanding any other provision of the Plan to the contrary, no termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted under the Plan, without the written consent of the Grantee of such Award.

 

Article 14.                       Withholding

 

14.1                     Withholding

 

(a)                            Mandatory Tax Withholding.

 

(1)                      Whenever, under the Plan, Shares are to be delivered upon exercise or payment of an Award or upon Restricted Shares becoming non-forfeitable, or any other event with respect to rights and benefits hereunder, the Company shall be entitled to require (i) that the Grantee remit an amount in cash, or if determined by the Committee, Shares, sufficient to satisfy all federal, state, local and foreign tax withholding requirements related thereto (“Required Withholding”), (ii) the withholding of such Required Withholding from compensation otherwise due to the Grantee or from any Shares or other payment due to the Grantee under the Plan or (iii) any combination of the foregoing.

 

(2)                       Any Grantee who makes a Disqualifying Disposition or an election under Section 83(b) of the Code shall remit to the Company an amount sufficient to satisfy all resulting Required Withholding; provided that, in lieu of or in addition to the foregoing, the Company shall have the right to withhold such Required Withholding from compensation otherwise due to the Grantee or from any Shares or other payment due to the Grantee under the Plan.

 

(b)                            Elective Share Withholding.

 

(1)                       Subject to Section 14.1(b)(2), a Grantee may elect the withholding (“Share Withholding”) by the Company of a portion of the Shares subject to an Award upon the exercise of such Award or upon Restricted Shares becoming non-forfeitable or upon making an election under Section 83(b) of the Code (each, a “Taxable Event”) having a Fair Market Value equal to (i) the minimum amount necessary to satisfy Required Withholding liability attributable to the Taxable Event; or (ii) with the Committee’s prior approval, a greater amount, not to exceed the estimated total amount of such Grantee’s tax liability with respect to the Taxable Event.

 

(2)                       Each Share Withholding election shall be subject to the following conditions:

 

19

 

(i)                          any Grantee’s election shall be subject to the Committee’s discretion to revoke the Grantee’s right to elect Share Withholding at any time before the Grantee’s election if the Committee has reserved the right to do so in the Award Agreement;

 

(ii)                       the Grantee’s election must be made before the date (the “Tax Date”) on which the amount of tax to be withheld is determined; and

 

(iii)                   the Grantee’s election shall be irrevocable.

 

14.2                     Notification under Code Section 83(b).  If the Grantee, in connection with the exercise of any Option, or the grant of Restricted Shares, makes the election permitted under Section 83(b) of the Code to include in such Grantee’s gross income in the year of transfer the amounts specified in Section 83(b) of the Code, then such Grantee shall notify the Company of such election within 10 days of filing the notice of the election with the Internal Revenue Service, in addition to any filing and notification required pursuant to regulations issued under Section 83(b) of the Code. The Committee may, in connection with the grant of an Award or at any time thereafter prior to such an election being made, prohibit a Grantee from making the election described above.

 

Article 15.                       Successors

 

All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise of all or substantially all of the business and/or assets of the Company.

 

Article 16.                       Additional Provisions

 

16.1                     Gender and Number.  Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine, the plural shall include the singular and the singular shall include the plural.

 

16.2                     Severability.  If any part of the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity shall not invalidate any other part of the Plan. Any Section or part of a Section so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.

 

16.3                     Requirements of Law.  The granting of Awards and the issuance of Shares under the Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or stock exchanges as may be required.  Notwithstanding any provision of the Plan or any Award, Grantees shall not be entitled to exercise, or receive benefits under, any Award, and the Company shall not be obligated to deliver any Shares or other benefits to a Grantee, if such exercise or delivery would constitute a violation by the Grantee or the Company of any applicable law or regulation.

 

20

 

16.4                     Securities Law Compliance.

 

(a)                            If the Committee deems it necessary to comply with any applicable securities law, or the requirements of any stock exchange upon which Shares may be listed, the Committee may impose any restriction on Shares acquired pursuant to Awards under the Plan as it may deem advisable.  All certificates for Shares delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations and other requirements of the SEC, any stock exchange upon which Shares are then listed, any applicable securities law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.  If so requested by the Company, the Grantee shall make a written representation to the Company that he or she will not sell or offer to sell any Shares unless a registration statement shall be in effect with respect to such Shares under the Securities Act of 1993, as amended, and any applicable state securities law or unless he or she shall have furnished to the Company evidence satisfactory to the Company that such registration is not required.

 

(b)                            If the Committee determines that the exercise or non-forfeitability of, or delivery of benefits pursuant to, any Award would violate any applicable provision of securities laws or the listing requirements of any stock exchange upon which any of the Company’s equity securities are listed, then the Committee may postpone any such exercise, non-forfeitability or delivery, as applicable, but the Company shall use all reasonable efforts to cause such exercise, non-forfeitability or delivery to comply with all such provisions at the earliest practicable date.

 

16.5                     No Rights as a Stockholder.  A Grantee shall not have any rights as a stockholder of the Company with respect to the Shares (other than Restricted Shares) which may be deliverable upon exercise or payment of such Award until such shares have been delivered to him or her. Restricted Shares, whether held by a Grantee or in escrow by the Secretary of the Company, shall confer on the Grantee all rights of a stockholder of the Company, except as otherwise provided in the Plan or Award Agreement. At the time of a grant of Restricted Shares, the Committee may require the payment of cash dividends thereon to be deferred and, if the Committee so determines, reinvested in additional Restricted Shares.  Stock dividends and deferred cash dividends issued with respect to Restricted Shares shall be subject to the same restrictions and other terms as apply to the Restricted Shares with respect to which such dividends are issued. The Committee may provide for payment of interest on deferred cash dividends.

 

16.6                     Nature of Payments.  Awards shall be special incentive payments to the Grantee and shall not be taken into account in computing the amount of salary or compensation of the Grantee for purposes of determining any pension, retirement, death or other benefit under (a) any pension, retirement, profit-sharing, bonus, insurance or other employee benefit plan of the Company or any Subsidiary or (b) any agreement between (i) the Company or any Subsidiary and (ii) the Grantee, except as such plan or agreement shall otherwise expressly provide.

 

16.7                     Governing Law.  The Plan, and all agreements hereunder, shall be construed in accordance with and governed by the laws of the State of Delaware other than its laws respecting choice of law.

 

21

 

16.8                     Code Section 409A Compliance.  The intent of the parties is that payments and benefits under this Plan comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Plan shall be interpreted and be administered to be in compliance therewith.  Any payments described in this Plan that are due within the “short term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise.  Notwithstanding anything to the contrary in this Plan, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Plan during the six-month period immediately following the Grantee’s termination of employment shall instead be paid on the first business day after the date that is six months following the Grantee’s separation from service (or upon Participant’s death, if earlier).  In addition, for purposes of this Plan, each amount to be paid or benefit to be provided to the Grantee pursuant to the Plan, which constitute deferred compensation subject to Section 409A of the Code, shall be construed as a separate identified payment for purposes of Section 409A of the Code.

 

22Exhibit 10.1

 

EXECUTION VERSION

 

FACILITY INCREASE AGREEMENT

 

This FACILITY INCREASE AGREEMENT (this “Agreement”), dated as of December 1, 2014, is made by NGL ENERGY OPERATING LLC, a Delaware limited liability company (the “Borrowers’ Agent”), MIZUHO BANK, LTD., as a new Lender (the “New Revolving Lender”), DEUTSCHE BANK TRUST COMPANY AMERICAS, as administrative agent for the Secured Parties (in such capacity, together with its successors in such capacity, the “Administrative Agent”) and each Issuing Bank party hereto.  Capitalized terms used in this Agreement and not defined herein, including in this preamble, have the meanings set forth for such terms in the Credit Agreement (as hereinafter defined).

 

WHEREAS, the Borrowers, the Guarantors, the Administrative Agent, Deutsche Bank AG, New York Branch, as technical agent, Deutsche Bank Trust Company Americas, as collateral agent for the Secured Parties and the Lenders party thereto have entered into a Credit Agreement dated as of June 19, 2012, as amended by Amendment No. 1 thereto, dated as of January 15, 2013, Amendment No. 2 thereto, dated as of May 8, 2013, Amendment No. 3 thereto, dated as of September 30, 2013, Amendment No. 4 thereto, dated as of November 5, 2013, Amendment No. 5 thereto, dated as of December 23, 2013, Amendment No. 6 thereto, dated as of June 12, 2014, and Amendment No. 7, dated as of June 27, 2014 (and as otherwise amended, supplemented or modified from time to time, the “Credit Agreement”).

 

WHEREAS, the parties hereto desire to evidence an increase in the aggregate Working Capital Commitments pursuant to Section 2.4(c) of the Credit Agreement as set forth herein.

 

NOW, THEREFORE, for good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

1.             The aggregate Working Capital Revolving Commitments and Acquisition Facility Commitments are hereby modified from $1,460,000,000 to $1,438,000,000 and from $733,000,000 to $858,000,000, respectively, as of the effective date of this Agreement (the “Increase Effective Date”), the Commitments of the Lenders shall be as set forth in Schedule 1 hereto.

 

2.             Consistent with Section 2.4(c)(v) of the Credit Agreement, as of the Increase Effective Date, Schedule 1 shall supersede and replace Schedule 1.1A of the Credit Agreement.

 

3.             To induce the New Revolving Lender and other Secured Parties party hereto to enter into this Agreement, the Borrowers’ Agent (by delivery of its respective counterpart to this Agreement) hereby (i) represents and warrants that after giving effect to this Agreement, the representations and warranties contained in the Credit Agreement and other Loan Documents are true and correct in all material respects on and as of the date hereof with the same effect as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties were true and correct in all material respects as of such earlier date); (ii) represents and warrants that in connection with this Agreement, it (x) has the requisite power and authority to make, deliver and perform this Agreement on behalf of the Credit Parties; (y) has taken all necessary corporate, limited liability company, limited partnership or other action to authorize its execution, delivery and performance of this Agreement, and (z) has duly executed and delivered this Agreement; and (iii) certifies that no Default or Event of Default has occurred and is continuing under the Credit Agreement (both immediately before and after giving effect to this Agreement).

 

4.             The New Revolving Lender hereby (i) accepts and agrees to be bound by the terms of the Credit Agreement as a Lender thereunder, and (ii) acknowledges and agrees that the amount of its Commitment after giving effect to this Agreement is set forth opposite its name on Schedule 1 hereto.

 

 

This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Agreement may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Agreement by telecopy or electronic transmission (in .pdf format) shall be effective as delivery of a manually executed counterpart of this Agreement.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.

 

[Signature Pages Follow]

 

2

 

IN WITNESS WHEREOF, each party hereto has caused this Agreement to be executed and delivered by its officer thereunto duly authorized as of the date above first written.

 

 

	
 
    	
NGL   ENERGY OPERATING LLC,
    
	
 
    	
as   Borrowers’ Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Atanas H. Atanasov
    
	
 
    	
 
    	
Name:  Atanas   H. Atanasov
    
	
 
    	
 
    	
Title:    Chief   Financial Officer and Treasurer
    

 

 

	
 
    	
DEUTSCHE   BANK TRUST COMPANY AMERICAS, as Administrative Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Melissa Sadler
    
	
 
    	
 
    	
Name:  Melissa   Sadler
    
	
 
    	
 
    	
Title:    Vice   President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Deirdre Lewis
    
	
 
    	
 
    	
Name:  Deirdre   Lewis
    
	
 
    	
 
    	
Title:    Vice   President
    

 

2

 

	
 
    	
DEUTSCHE   BANK AG, NEW YORK BRANCH, as Issuing Bank and Swing Line Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Chris Chapman
    
	
 
    	
 
    	
Name:  Chris   Chapman
    
	
 
    	
 
    	
Title:    Director
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Vanuza Pereira-Bravo
    
	
 
    	
 
    	
Name:  Vanuza   Pereira-Bravo
    
	
 
    	
 
    	
Title:    AVP
    

 

3

 

	
Commitment:   $103,000,000
    	
MIZUHO BANK, LTD., as the New Revolving   Lender
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Leon Mo
    
	
 
    	
 
    	
Name:  Leon   Mo
    
	
 
    	
 
    	
Title:    Authorized   Signatory
    

 

4

 

	
 
    	
Acknowledged   and agreed,
    
	
 
    	
 
    
	
 
    	
BNP   PARIBAS,
    
	
 
    	
as   Issuing Bank
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Matt Worstell
    
	
 
    	
 
    	
Name:  Matt   Worstell
    
	
 
    	
 
    	
Title:    Director
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Keith Cox
    
	
 
    	
 
    	
Name:  Keith   Cox
    
	
 
    	
 
    	
Title:    Managing   Director
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
BANK   OF AMERICA, N.A.,
    
	
 
    	
as   Issuing Bank
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Michael Clayborne
    
	
 
    	
 
    	
Name:  Michael   Clayborne
    
	
 
    	
 
    	
Title:    Vice   President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
PNC   BANK, NATIONAL ASSOCIATION,
    
	
 
    	
as   Issuing Bank
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Chris Helmann
    
	
 
    	
 
    	
Name:  Chris   Helmann
    
	
 
    	
 
    	
Title:    Vice   President
    

 

5

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00238-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00238-of-00352.parquet"}]]