Document:

exhibit10-9.htm

Exhibit 10.9

 

NORTHERN OIL AND GAS, INC.

AMENDED AND RESTATED

2009 EQUITY INCENTIVE PLAN

Restricted Stock Agreement

	
Name of Grantee:

	
No. of Shares Covered:

	
Date of Issuance:

	
Vesting Schedule pursuant to Section 3:

	  	
Vesting Date(s)

	  	
Shares Released From Restrictions

	  
	  	
  

 

 

 

 

	  	  	  

This Restricted Stock Agreement (“Agreement”) has been made as of the Date of Issuance set forth above between Northern Oil and Gas, Inc., a Minnesota Corporation (the “Company”), and the above-named Grantee.

 

Recitals

 

WHEREAS, the Company maintains the Northern Oil and Gas, Inc. Amended and Restated 2009 Equity Incentive Plan (as amended from time to time, the “Plan”);

 

WHEREAS, the Board of Directors (the “Board”) of the Company has appointed the Compensation Committee (the “Committee”) with the authority to determine the awards to be granted under the Plan; and

 

WHEREAS, the Committee or its designee has determined that the Grantee is eligible to receive an award under the Plan in the form of restricted stock and has set the terms thereof.

 

NOW, THEREFORE, the Company and the Grantee mutually agree as follows:

 

 

  

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Terms and Conditions*

 

	
1.  

	
Grant of Restricted Shares.

 

	
  

	
(a)

	
Grant. The Company hereby issues to the Grantee the number of shares specified at the beginning of this Agreement (the “Restricted Shares”) on the terms and conditions and subject to the restrictions set forth in this Agreement. The term “Restricted Shares” also refers to all securities received by the Grantee in replacement of or in connection with the Restricted Shares granted hereby pursuant to a recapitalization, reclassification, stock dividend, stock split, stock combination or other relevant event.

 

	
  

	
(b)

	
Certificate. Within a reasonable time after the execution of this Agreement by the Grantee and the Company, the Company shall cause a book entry representing the Restricted Shares to be made in the name of the Grantee by the Company’s transfer agent and registrar, or have a certificate or certificates representing the Restricted Shares issued in the name of the Grantee and held by the Company or its designee, until the vesting and other conditions set forth in this Agreement have been satisfied. The Company shall pay all original issue or transfer taxes, if any, with respect to the issue or transfer of the Restricted Shares and all fees and expenses necessarily incurred by the Company in connection therewith. All Restricted Shares so issued shall be fully paid and nonassessable. Notwithstanding anything to the contrary in this Agreement, the Company shall not be required to deliver a certificate or certificates representing any Restricted Shares prior to (i) the vesting of such Restricted Shares in accordance with Section 3 and (ii) the completion of such registration or other qualification of such Restricted Shares for sale under the laws, rules or regulations of any state or other jurisdiction as the Company shall determine to be necessary or desirable. Upon the vesting of Restricted Shares in accordance with Section 3 and provided that the other conditions set forth in the previous sentence and elsewhere in this Agreement have been satisfied, the Company shall deliver such vested Restricted Shares in uncertificated format, or deliver a certificate or certificates representing such vested Restricted Shares, to the Grantee as promptly as practicable.

 

	
2.  

	
Shareholder Rights. As the owner of record of the shares of Common Stock issued pursuant to this Restricted Stock Award, the Grantee is entitled to all the rights of a shareholder of the Company, including the right to vote, the right to receive cash or stock dividends, and the right to receive shares in any recapitalization of the Company. If the Grantee receives any additional shares by reason of being the holder of the shares of Common Stock issued or transferred under this Restricted Stock Award or of the additional shares previously distributed to the Grantee, all the additional shares shall be subject to the provisions of this Agreement.

 

	
3.  

	
Vesting. The Restricted Shares shall cease to be subject to forfeiture under Section 4 hereof in the numbers and on the dates specified in the vesting schedule at the beginning of this Agreement; provided, however, that the Restricted Shares shall immediately cease to be subject to forfeiture under Section 4 hereof (i) upon the occurrence of a Change of Control (as defined in the Plan) or (ii) if the Grantee’s employment with the Company terminates because of death or disability. Restricted Shares that have so ceased to be subject to forfeiture are sometimes referred to as “vested” or as “Vested Shares” in this Agreement.

 

 

	
*

	
Unless the context indicates otherwise, terms that are not defined in this Agreement shall have the meaning set forth in the Plan as it currently exists or as it is amended in the future. If the Grantee hereunder is a director of the Company, rather than an employee, all references herein to “employment with the Company” and similar phrases shall be deemed to mean “service as a director of the Company.”

 

 

  

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4.  

	
Forfeiture Events and Transfer Restrictions.

 

	
  

	
(a)

	
Forfeiture Events. Upon the occurrence of a “Forfeiture Event” (as defined below), the Grantee shall forfeit to the Company all of the Restricted Shares that have not become vested pursuant to Section 3, and upon such forfeiture the Grantee shall immediately return any stock certificates representing any unvested Restricted Shares then held by the Grantee and execute and deliver such stock powers as the Company may request. The Restricted Shares that are forfeited pursuant to the previous sentence shall become authorized but unissued shares of the Company’s capital stock. A Forfeiture Event means any of the following events:

 

	
  

	
(i)

	
termination of the Grantee’s status as an employee of the Company for any reason (other than death or disability), whether by the Company with or without cause, voluntarily or involuntarily by the Grantee or otherwise (“Termination of Employment”); or

 

	
  

	
(ii)

	
any attempt to transfer or otherwise dispose of any of the Restricted Shares, or to levy any attachment or pursue any similar involuntary process with respect to any Restricted Shares, in violation of Section 4(b) of this Agreement.

 

For purposes of this Agreement, a leave of absence granted by the Board shall not be deemed a Termination of Employment.

 

	
  

	
(b)

	
Limitation on Transfer. Until such time as the Restricted Shares have become vested under Section 3, the Grantee shall not transfer the Restricted Shares and the Restricted Shares shall not be subject to pledge, hypothecation, execution, attachment or similar process. Any attempt to assign, transfer, pledge, hypothecate or otherwise dispose of any Restricted Shares contrary to the provisions hereof, and any attempt to levy any attachment or pursue any similar process with respect to them, shall be null and void.

 

	
5.  

	
Tax Withholding; Surrender for Tax Payments. The parties hereto recognize that the Company may be obligated to withhold federal and state taxes or other taxes upon the vesting of the Restricted Shares, or, in the event that the Grantee elects under Code Section 83(b) to report the receipt of the Restricted Shares as income in the year of receipt, upon the Grantee’s receipt of the Restricted Shares. The Grantee agrees that, at such time, if the Company is required to withhold such taxes, the Grantee will promptly pay, in cash or through the forfeiture of Vested Shares or other unencumbered shares of Company common stock to the Company (or in any other manner permitted by the Committee in accordance with the terms of the Plan), upon demand, to the Company or the subsidiary having such obligation, such amounts as shall be necessary to satisfy such obligation. Without limiting the foregoing, to the extent the Company is required to withhold taxes or the Grantee is required to pay taxes in connection with the vesting or receipt of shares of Company common stock granted through any Award under the Plan, the Grantee shall have the option to pay to the Company all amounts necessary to satisfy such tax obligations through either (a) cash payment or (b) the forfeiture of unencumbered shares of Company common stock, including but not limited to shares of the vesting or received Company common stock.  The Grantee further acknowledges that the Company has directed the Grantee to seek independent advice regarding the applicable provisions of the Code, the income tax laws of any municipality, state or foreign country in which the Grantee may reside, and the tax consequences of the Grantee’s death.

 

 

  

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6.  

	
Restrictive Legends and Stop-Transfer Orders.

 

	
  

	
(a)

	
Legends. Any stock certificate or certificates issued to evidence ownership of the Restricted Shares pursuant to this Agreement shall bear the following legend on the reverse side:

 

These shares have been issued or transferred subject to a Restricted Stock Agreement and are subject to substantial restrictions, including but not limited to, a prohibition against transfer, either voluntarily or involuntarily, and a provision requiring transfer of these shares to Northern Oil and Gas, Inc. without any payment in the event of termination of the employment of the registered owner, all as more particularly set forth in a Restricted Stock Agreement, a copy of which is on file with our company.

 

	
  

	
(b)

	
Stop-Transfer Notices. The Grantee agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.

 

	
  

	
(c)

	
Refusal to Transfer. The Company shall not be required (i) to transfer on its books any Restricted Shares that have been sold or otherwise transferred in violation of any of the provisions of this Agreement or (ii) to treat as owner of the Restricted Shares or to accord the right to vote or pay dividends to any purchaser or other transferee to whom the Restricted Shares shall have been so transferred.

 

	
7.  

	
Specific Performance. By accepting this Restricted Stock Award and the issuance and delivery of the shares of common stock pursuant to this Agreement, the Grantee acknowledges that the Company does not have an adequate remedy in damages for the breach by the Grantee of the conditions and covenants set forth in this Agreement and agrees that the Company is entitled to an order or a decree of specific performance against the Grantee issued by any court having jurisdiction.

 

	
8.  

	
No Guarantee of Employment. Nothing in this Agreement or in the Plan shall confer upon the Grantee the right to continued employment with the Company.

 

	
9.  

	
Acknowledgment of Receipt of Copy. By execution hereof, the Grantee acknowledges having received a copy of the Plan.

 

	
10.  

	
Entire Agreement. This Agreement and the Plan set forth the entire agreement and understanding of the parties hereto with respect to the issuance and sale of the Restricted Shares and the administration of the Plan and supersede all prior agreements, arrangements, plans, and understandings relating to the issuance and sale of these Restricted Shares and the administration of the Plan; provided, however, that to the extent any term of this Agreement is inconsistent with the terms of any employment or similar agreement between Grantee and the Company, such employment or similar agreement shall govern (so long as not in violation of the Plan).

 

 

  

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11.  

	
Amendment and Waiver. Except as provided in the Plan, this Agreement may be amended, waived, modified, or canceled only by a written instrument executed by the parties or, in the case of a waiver, by the party waiving compliance. A waiver by the Company of any provision of this Agreement shall not operate as a waiver of the same or any other provision of this Agreement at any subsequent time for any other purpose.

 

	
12.  

	
Interpretation of This Agreement. All decisions and interpretations made by the Committee with regard to any question arising hereunder or under the Plan shall be binding and conclusive upon the Company and the Grantee. If there is any inconsistency between the provisions of this Agreement and the Plan, the provisions of the Plan shall govern.

 

	
13.  

	
Binding Effect. This Agreement shall be binding in all respects on the heirs, representatives, successors and assigns of the Grantee.

 

	
14.  

	
Choice of Law. This Agreement is entered into under the laws of the State of Minnesota and shall be construed and interpreted thereunder (without regard to its conflict-of-law principles).

 

 

[Signature Page Follows]

 

 

 

  

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IN WITNESS WHEREOF, the Grantee and the Company have executed this Agreement as of the Date of Issuance specified at the beginning of this Agreement.

 

GRANTEE

 

 

_______________________________

 

NORTHERN OIL AND GAS, INC.

 

 

_______________________________

By                                                                      

                           

                                                                                                        _______________________________

ItsExhibit 10.14

 

INTEGRYS ENERGY GROUP, INC.

PERFORMANCE STOCK RIGHT AGREEMENT

 

You have been granted a Performance Stock Right with respect to shares of common stock of Integrys Energy Group, Inc. (the “Company”) under the Integrys Energy Group, Inc. 2010 Omnibus Incentive Compensation Plan (the “Plan”). This Agreement sets forth the terms, rights and obligations of you and the Company with respect to your Performance Stock Right. This Agreement shall not become effective until you sign and return the “Acknowledgement Form” from this Agreement to Human Resources.

 

The Performance Stock Right is granted under, and is subject to, the terms of the Plan, which are specifically incorporated by reference in this Agreement. Any capitalized terms used in this Agreement which are not defined shall have the meaning set forth in the Plan.

 

1.             Grant of Performance Stock Right. (a) Subject to the terms of this Agreement, the Company grants to you a Performance Stock Right representing shares (“Target Award”), of the common stock of the Company, par value $1.00 (“Common Stock”), in the event certain Performance Goals specified herein are satisfied. You obtain no ownership interest in the Company and will not be considered a shareholder of the Company by virtue of the grant of the Performance Stock Right hereunder until such time as Common Stock may be issued to you as a Final Award.

 

(b)           In the event of certain corporate transactions described in Section 12 of the Plan, the number of shares of Common Stock represented by your Performance Stock Right will be adjusted by the Compensation Committee of the Board of Directors of the Company (the “Committee”). The Committee’s determination as to any adjustment shall be final.

 

2.             Performance Period. Subject to the provisions of Section 7, the Performance Period is the period from January 1, 2012 to December 31, 2014.

 

3.             Performance Measures.

 

(a)           Total Shareholder Return (“TSR”). TSR is the quotient obtained by dividing (1) the Shareholder Return with respect to a share of Common Stock, by (2) the Beginning Market Price of a share of Common Stock. For this purpose:

 

(1)           The Shareholder Return means the cash dividends paid on a share of Common Stock during the Performance Period, increased by (if positive) or reduced by (if negative) the change in stock price from the Beginning Market Price of a share of Common Stock to the Ending Market Price of a share of Common Stock.

 

(2)           The Beginning Market Price of a share of Common Stock is the average closing market price of a share of Common Stock for the 30

 

 

trading days immediately preceding the first day of the Performance Period as reported on the securities exchange on which such stock is principally traded.

 

(3)           The Ending Market Price of a share of Common Stock is the average closing market price of a share of Common Stock for the 30 trading days ending on or immediately preceding the last day of the Performance Period as reported on the securities exchange on which such stock is principally traded.

 

(b)           Comparison Group. Comparison Group means all utility industry companies in the Standard and Poor’s 1500 Index on both the first day and the last day of the Performance Period.

 

4.             Determination of Presumptive and Final Awards.

 

(a)           Presumptive Award. As soon as practicable following the completion of the Performance Period, the Committee will determine the TSR of the Company and of each company in the Comparison Group. The Committee’s determination will be final and binding on all persons. Your Presumptive Award shall be determined in accordance with the following table; provided that any fractional share of Common Stock that would otherwise result from the foregoing calculation shall be disregarded.

 

 

 

	
Company TSR In Relation to
   TSR of All Comparison Group
   Companies
    	
 
    	
Presumptive Award Equal to
   the Following Percentage of
   the Target Award*
    	
 
    
	
90th Percentile or Greater 
    	
 
    	
200
    	
%
    
	
75th Percentile
    	
 
    	
150
    	
%
    
	
50th Percentile
    	
 
    	
100
    	
%
    
	
25th Percentile
    	
 
    	
50
    	
%
    
	
Below the 25th Percentile
    	
 
    	
0
    	
%
    

 

*The Presumptive Award for TSR performance between points on the payout schedule will be interpolated.

 

(b)           Final Award. The Presumptive Award is used as a guideline for the Committee in determining your Final Award, and you obtain no rights as a result of the determination of the Presumptive Award. In determining the Final Award to be made to you, the Committee, in its sole discretion, may increase or decrease the amount of the Presumptive Award; provided that the Committee will not increase the amount of your Presumptive Award if the Final Award is intended to comply with Section 162(m) of the Internal Revenue Code and if you are a Covered Executive (as defined in the Plan) for purposes of Section 162(m) of the Internal Revenue Code. Except with respect to the portion (if any) of the Final Award payment of which is deferred in accordance with the Integrys Energy Group, Inc. Deferred Compensation Plan, the Final Award will be distributed to you between January 1 and March 15 of the calendar year following the calendar year in which the Performance Period ends.

 

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5.             Dividend Equivalents. You will not receive any cash or other consideration to reflect dividends that would have been paid or accrued had the Performance Stock Right been actual shares of Stock either during the Performance Period or at any time prior to actual distribution of your Final Award.

 

6.             Effect of Termination of Employment.

 

(a)           Except as set forth in subsections (b) and (c) below and Section 7 below, or as otherwise determined by the Committee, your Performance Stock Right will be cancelled immediately and without notice to you, and no Final Award will be made, in the event you terminate employment from the Company and its Affiliates prior to the last day of the Performance Period.

 

(b)           [Standard Paragraph (b) — For use with regular grants made in February or March of each year.] If your employment or service terminates prior to the last day of the Performance Period as a result of death or disability (as determined by the Committee based upon the definition set forth in the Company’s long-term disability plan), your Performance Stock Right will not be cancelled (or will be only partially cancelled) upon termination of employment: (1) if your termination occurs on or after December 31 of the calendar year in which occurs the Grant Date of your Performance Stock Right, you (or your estate) may be eligible to receive a Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period, or (2) if your termination occurs prior to December 31 of the calendar year in which occurs the Grant Date of your Performance Stock Right, you (or your estate) may be eligible to receive a pro-rated Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period (and only the remainder of your Performance Stock Right will be cancelled). The pro-rated award for which you are eligible shall be equal to the Final Award to which you otherwise would have been entitled if employment had not terminated, multiplied by a fraction, the numerator of which is the number of full months of service that you completed during the calendar year in which occurs the Grant Date of your Performance Stock Right, and the denominator of which is twelve (12). If the foregoing calculation results in vesting of a fractional share, the number of shares included in your Final Award will be rounded to the next higher whole number of shares. Except with respect to the portion (if any) of the Final Award payment of which is deferred in accordance with the Integrys Energy Group, Inc. Deferred Compensation Plan, the Final Award will be distributed to you (or your estate) between January 1 and March 15 of the calendar year following the calendar year in which the Performance Period ends.

 

[Alternate Paragraph (b) — For use in mid-year special grants where proration based on the calendar year might result in substantial vesting shortly following the Grant Date. Under the alternate paragraph, proration is based on the number of months of employment completed during the one year period from the first day of the month in which occurs the Grant Date.] If your employment or service terminates prior to the last day of the Performance Period as a result of death or disability (as determined by the Committee based upon the definition set forth in the Company’s long-term disability plan), your Performance Stock Right will not be cancelled (or will be only partially cancelled) upon termination of employment: (1) if your termination occurs on or after the first day of the twelfth

 

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(12th) month following the month in which occurs the Grant Date of your Performance Stock Right, you (or your estate) may be eligible to receive a Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period, or (2) if your termination occurs prior to the first day of the twelfth (12th) month following the month in which occurs the Grant Date of your Performance Stock Right, you (or your estate) may be eligible to receive a pro-rated Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period (and only the remainder of your Performance Stock Right will be cancelled). The pro-rated award for which you are eligible shall be equal to the Final Award to which you otherwise would have been entitled if employment had not terminated, multiplied by a fraction, the numerator of which is the number of full months of service that you completed during the twelve (12) month period that begins on the first day of the month following the month in which occurs the Grant Date of your Performance Stock Right, and the denominator of which is twelve (12). If the foregoing calculation results in vesting of a fractional share, the number of shares included in your Final Award will be rounded to the next higher whole number of shares. Except with respect to the portion (if any) of the Final Award payment of which is deferred in accordance with the Integrys Energy Group, Inc. Deferred Compensation Plan, the Final Award will be distributed to you (or your estate) between January 1 and March 15 of the calendar year following the calendar year in which the Performance Period ends.

 

(c)           [Standard Paragraph (c) — For use with regular grants made in February or March of each year.] If your employment or service terminates prior to the last day of the Performance Period as a result of retirement on or after age fifty-five (55) with ten (10) or more years of service, or retirement on or after age sixty-two (62) (“Retirement”), your Performance Stock Right will not be cancelled (or will be only partially cancelled) upon termination of employment: (1) if your Retirement occurs on or after December 31 of the calendar year in which occurs the Grant Date of your Performance Stock Right,, you may be eligible to receive a Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period, and (2) if your Retirement occurs prior to December 31 of the calendar year in which occurs the Grant Date of your Performance Stock Right, you may be eligible to receive a pro-rated Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period (and only the remainder of your Performance Stock Right will be cancelled). The pro-rated award shall be equal to the Final Award to which you otherwise would have been entitled if employment had not terminated, multiplied by a fraction, the numerator of which is the number of full months of service that you completed during the calendar year in which occurs the Grant Date of your Performance Stock Right, and the denominator of which is twelve (12). If the foregoing calculation results in vesting of a fractional share, the number of shares included in your Final Award will be rounded to the next higher whole number of shares. Except with respect to the portion (if any) of the Final Award payment of which is deferred in accordance with the Integrys Energy Group, Inc. Deferred Compensation Plan, the Final Award will be distributed to you between January 1 and March 15 of the calendar year following the calendar year in which the Performance Period ends.

 

[Alternate Paragraph (c) — For use in mid-year special grants where proration based on the calendar year might result in substantial vesting shortly following

 

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the Grant Date. Under the alternate paragraph, proration is based on the number of months of employment completed during the one year period from the first day of the month in which occurs the Grant Date.] If your employment or service terminates prior to the last day of the Performance Period as a result of retirement on or after age fifty-five (55) with ten (10) or more years of service, or retirement on or after age sixty-two (62) (“Retirement”), your Performance Stock Right will not be cancelled (or will be only partially cancelled) upon termination of employment: (1) if your Retirement occurs on or after first day of the twelfth (12th) month following the month in which occurs the Grant Date of your Performance Stock Right,, you may be eligible to receive a Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period, and (2) if your Retirement occurs prior to first day of the twelfth (12th) month following the month in which occurs the Grant Date of your Performance Stock Right, you may be eligible to receive a pro-rated Final Award, determined in accordance with Section 4 and this Section 6, following the conclusion of the Performance Period (and only the remainder of your Performance Stock Right will be cancelled). The pro-rated award shall be equal to the Final Award to which you otherwise would have been entitled if employment had not terminated, multiplied by a fraction, the numerator of which is the number of full months of service that you completed during the twelve (12) month period that begins on the first day of the month following the month in which occurs the Grant Date of your Performance Stock Right, and the denominator of which is twelve (12). If the foregoing calculation results in vesting of a fractional share, the number of shares included in your Final Award will be rounded to the next higher whole number of shares. Except with respect to the portion (if any) of the Final Award payment of which is deferred in accordance with the Integrys Energy Group, Inc. Deferred Compensation Plan, the Final Award will be distributed to you between January 1 and March 15 of the calendar year following the calendar year in which the Performance Period ends.

 

7.             Change in Control. In general, you may be entitled to a Final Award, even if not otherwise entitled to a Final Award in accordance with the Sections 4 and 6 above, if (1) a Change in Control (as defined in the Plan) has occurred and (2) your employment with the Company and its Affiliates has been involuntarily terminated for any reason other than Cause (or, if you have in effect with the Company or an Affiliate an employment, retention, change in control, severance or similar agreement that provides for “good reason” termination and, in accordance with such agreement, you terminate employment or service for “good reason”) within two (2) years following the date of the Change in Control. Your entitlement to a Final Award, and the amount and distribution of any Final Award to which you become entitled, shall be governed by the terms of Section 13(b) of the Plan; provided that distribution of any Final Award that becomes payable as a result of your termination of employment shall be distributed upon the earlier to occur of (1) the date distribution would otherwise have been made if your employment had continued, or (2) six (6) months following termination of your employment.  In addition, if you terminated employment pursuant to Section 6 on account of death, disability or Retirement prior to the occurrence of the Change in Control, the Final Award attributable to your Performance Stock Right (or pro rated Performance Stock Right under Section 6) with respect to any Performance Period that has not been completed as of the date of the Change in Control shall be calculated as of the date of the Change in Control at the target level of performance (or, if greater, the then projected Final Award level). Distribution shall then be made upon the earlier to occur (1) if the Change in Control constitutes a “change in control

 

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event” within the meaning of Internal Revenue Code Section 409A, as soon as practicable (and not more than ninety (90) days) following the occurrence of such change in control event, or (2) the date on which distribution otherwise would have been made if the Change in Control did not occur. For purposes of this Section, your employment or service will be considered terminated if the Company determines that you have incurred a “separation from service” as such term is defined for purposes of Section 409A of the Internal Revenue Code, taking into account, in the case of an absence from service for disability, the maximum leave periods permitted under Internal Revenue Code Section 409A for disability leaves of absence. Notwithstanding anything in the Plan or this Agreement to the contrary, if at the time of a Change in Control, or at any other time, your Performance Stock Right is cancelled and converted to a cash value, and if such cancellation and conversion occurs prior to the date on which vested amounts are to be settled under this Agreement, the cash value of your cancelled and converted Performance Stock Right will accrue interest equivalent at the prime rate of interest from the cancellation and conversion date to the distribution date.

 

8.             Tax Withholding. Upon the issuance of Common Stock pursuant to a Final Award or at any other time deemed necessary or appropriate by the Committee, the Company has the right and the authority to deduct or withhold from any compensation payable to you an amount sufficient to satisfy its withholding obligations under applicable tax laws or regulations. Alternatively, the Company may require that you deliver to the Company at the time the Company is obligated to withhold taxes such amount as the Company requires to meet its withholding obligation under applicable tax laws or regulations. The Company may also satisfy its withholding obligation, in whole or in part, by withholding (or requiring that you sell and remit to the Company the sale proceeds with respect to) a number of the shares of Common Stock included in any Final Award that have a Fair Market Value, as determined by the Committee, equal to the amount required to be withheld. The Fair Market Value of fractional shares of Stock remaining after withholding requirements are satisfied will be paid to you in cash or will be applied as additional tax withholding.

 

9.             Miscellaneous.

 

(a)           You (or your legal representatives, the executor of your estate or your heirs) shall not be deemed to be a shareholder of the Company with respect to the Performance Stock Right until shares of Common Stock have been issued pursuant to a Final Award and the Company’s withholding tax liability has been satisfied, to the Committee’s satisfaction.

 

(b)           The Performance Stock Right shall not be transferable by you; provided that following your death, any Final Award made with respect to you will be paid to your estate or to such person as the executor of the estate certifies as being entitled to such payment as a result of the operation of your last will and testament or as a result of the laws of intestate succession. In addition, by accepting this award, you agree not to sell any shares of Common Stock delivered to you in connection with this Agreement at a time when applicable laws (including securities laws), Company or Affiliate policies or an agreement between the Company and its underwriters or other terms and conditions of the Plan prohibit a sale.

 

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(c)           It is fully understood that nothing contained in this Agreement or the Plan shall interfere with or limit in any way the right of the Company or any Affiliate to terminate your employment at any time nor confer upon you any right to continue in the employ of the Company or any Affiliate.

 

(d)           As a condition of the granting of a Performance Stock Right under this Agreement, you agree, for yourself and your legal representatives or guardians, the executor of your estate, and your heirs, that the Plan and this Agreement shall be subject to discretionary interpretation by the Committee and that any interpretation by the Committee of the terms of the Plan and this Agreement shall be final, binding and conclusive. Neither you, your legal representatives, the executor of your estate or your heirs shall challenge or dispute the Committee’s decisions.

 

(e)           The existence of this Agreement or the Performance Stock Right herein granted shall not affect in any way the right or power of the Company or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issuance of bonds, debentures, preferred, or prior preference stock ahead of or affecting the Common Stock or the rights thereof, or dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

 

(f)            The Committee may modify the Performance Stock Right at any time. However, no modification, extension or renewal shall (1) confer on you any right or benefit which you would not be entitled to if a new Performance Stock Right were granted under the Plan at such time or (2) alter, impair or adversely affect the Performance Stock Right or this Agreement without your written consent; provided that the Committee need not obtain your written consent for a modification of the Performance Stock Right to the extent that the Plan specifically permits the Committee action or to the extent that the Committee deems such modification necessary to comply with any applicable law, the listing requirements of any principal securities exchange or market on which the shares underlying the Performance Stock Right are then traded, or to preserve favorable accounting or tax treatment of the Performance Stock Right for the Company; and provided further, that unless the Committee determines that a Performance Stock Right is not intended to comply with the requirements of Section 162(m) of the Internal Revenue Code, the Committee shall not take any such action with respect to you if you are a Covered Executive (as defined in the Plan) if such action would cause any Final Award granted to you to cease to qualify as “qualified performance-based compensation” for purposes of Section 162(m) of the Internal Revenue Code.

 

(g)           No shares of Stock will be issued pursuant to a Final Award unless and until the Company has determined to its satisfaction that such issuance complies with all relevant provisions of applicable law, including the requirements of any stock exchange on which the Stock may then be traded.

 

(h)           This Agreement may be executed in counterparts.

 

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(i)            As a condition of the granting of a Performance Stock Right under this Agreement, you agree, for yourself and your legal representatives or guardians, the executor of your estate, and your heirs, that the Performance Stock Right and any Stock issued or cash paid pursuant to the Performance Stock Right shall be subject to any recoupment or clawback policy that may be adopted by the Company from time to time and to any requirement of applicable law, regulation or listing standard that requires the Company to recoup or claw back compensation paid pursuant to the Performance Stock Right.

 

10.          Governing Law. This Agreement shall be governed by the internal laws of the State of Illinois, without regard to the principle of conflict of laws, as to all matters, including, but not limited to, matters of validity, construction, effect, performance and remedies. No legal action or proceeding may be brought with respect to this Agreement more than one year after the later of (a) the last date on which the act or omission giving rise to the legal action or proceeding occurred; or (b) the date on which the individual bringing such legal action or proceeding had knowledge (or reasonably should have had knowledge) of such act or omission. Any such action or proceeding must be commenced and prosecuted in its entirety in the federal or state court having jurisdiction over Brown County, Wisconsin, or Cook County, Illinois, and each individual with any interest hereunder agrees to submit to the personal jurisdiction thereof, and agrees not to raise the objection that such courts are not a convenient forum.  Such action or other legal proceeding shall be heard pursuant to a bench trial, and the parties to such proceeding shall waive their rights to a trial by jury.

 

11.          Severability. In the event any provision of the Agreement is held illegal or invalid for any reason, the illegality or invalidity will not affect the remaining provisions of the Agreement, and the Agreement shall be construed and enforced as if the illegal or invalid provision had not been included.

 

	
 
    	
INTEGRYS   ENERGY GROUP, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Title:
    	
Vice   President — Human Resources
    

 

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