Document:

Exhibit 4.2

 

Permanent Global Registered Floating Rate Note

 

THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.  UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO A NOMINEE FOR DTC OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO AMERICAN EXPRESS COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

AMERICAN EXPRESS COMPANY

 

Floating Rate Notes due February 27, 2023

 

$

 

	
No.
    	
 
    	
CUSIP: 025816BT5
    
	
CC: 178590197
    	
 
    	
ISIN: US025816BT56
    

 

AMERICAN EXPRESS COMPANY, a New York corporation (hereinafter called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of $             on February 27, 2023, and to pay interest (computed on the basis of the actual number of days elapsed over a 360-day year) thereon from February 27, 2018, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, quarterly, on May 27, August 27, November 27 and February 27 in each year, subject to the Business Day Convention (as defined below), commencing February 27, 2018 and at maturity, at the rate of three-month LIBOR (as defined below) plus 0.650% per annum, until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in said Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on February 15, May 15, August 15 or November 15, as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the registered Holder on February 15, May 15, August 15 or November 15, as the case may be, and may be paid to the Person in whose name this Note (or one or more Predecessor Securities) is registered at the close of business on a Record Date

 

 

for the payment of such Defaulted Interest to be fixed by the Trustee for the Notes, notice whereof shall be given to Holders of Notes not less than 10 days prior to such record date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. Payment of the principal of and interest on this Note will be made by U.S. dollar check drawn on a bank in The City of New York and mailed to the Person in whose name this Note is registered at such Person’s address as provided in Securities Register. For Holders of at least $1,000,000 in aggregate principal amount of this Note, payment will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in The City of New York or in Europe, provided that the Trustee receives a written request from such Holder to such effect designating such account no later than the February 15, May 15, August 15 or November 15, as the case may be, immediately preceding such Interest Payment Date.

 

“Business Day” means any day which is not a Saturday or Sunday or any other day on which banks in New York City are authorized or obligated by law or regulation to close.

 

“Business Day Convention” means if any Interest Payment Date (other than the Stated Maturity of the Notes) is not a Business Day, then such Interest Payment Date will be postponed to the next succeeding Business Day unless that Business Day is in the next succeeding calendar month, in which case the Interest Payment Date will be the immediately preceding Business Day. If any such Interest Payment Date (other than the Stated Maturity of the Notes) is postponed or brought forward as described above, the interest amount will be adjusted accordingly and the Holders of the Notes will be entitled to more or less interest, respectively. If the Stated Maturity in respect of the Notes is not a Business Day, the payment of principal and interest at the Stated Maturity will not be made until the next following Business Day and no further interest will be paid in respect of the delay in such payment.

 

“Calculation Agent” means The Bank of New York Mellon, or its successor appointed by the Issuer, acting as calculation agent.

 

“three-month LIBOR” means for any Interest Payment Period, the London interbank offered rate per annum determined by the Calculation Agent on the related Interest Determination Date, in accordance with the following provisions:

 

(i) three-month LIBOR will be the rate for deposits in U.S. dollars having a maturity of three months which appears on the Reuters LIBOR01 Page (or such other page as may replace page LIBOR01 on that service for the purpose of displaying London interbank offered rates) as of 11:00 a.m., London time, on the related Interest Determination Date.

 

(ii) If, on any such Interest Determination Date, no rate appears on the Reuters LIBOR01 Page, except as provided in clause (iii) below, the Company will request the principal London offices of four major reference banks (which may include any underwriters, agents or their affiliates) in the London interbank market selected by the Company to provide their respective offered quotation for deposits in U.S. dollars having a maturity of three months commencing on the second London Business Day immediately following such Interest Determination Date to prime banks in the London interbank market at approximately 11:00 a.m., London time, on such Interest Determination Date and in a principal amount that is at least U.S.

 

2

 

$1,000,000. If at least two such quotations are provided, three-month LIBOR in respect of such Interest Determination Date will be the arithmetic mean of such quotations. If fewer than two quotations are provided, three-month LIBOR in respect of such Interest Determination Date will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., in New York City, on that Interest Determination Date for loans made in U.S. dollars to leading European banks having a maturity of three months commencing on the second London Business Day immediately following such Interest Determination Date and in a principal amount that is representative for a single transaction in U.S. dollars in New York City at such time by three major reference banks (which may include any underwriters, agents or their affiliates) in New York City. If fewer than three major reference banks in New York City so selected by the Company are quoting such rates as mentioned in the preceding sentence, three-month LIBOR with respect to such Interest Determination Date will be the same as three-month LIBOR in effect for the immediately preceding Interest Reset Period (or, if there was no preceding Interest Reset Period, the rate of interest will be the initial interest rate).

 

(iii) Notwithstanding clause (ii) above, if the Company or the Calculation Agent determines that three-month LIBOR has been permanently discontinued, the Calculation Agent will use, as a substitute for three-month LIBOR (the “Alternative Rate”) and for each future Interest Determination Date, the alternative reference rate selected by the central bank, reserve bank, monetary authority or any similar institution (including any committee or working group thereof) that is consistent with accepted market practice. As part of such substitution, the Calculation Agent will, after consultation with the Company, make such adjustments (“Adjustments”) to the Alternative Rate or the spread thereon, as well as the business day convention, interest determination dates and related provisions and definitions, in each case that are consistent with accepted market practice for the use of such Alternative Rate for debt obligations such as the Notes. If the Calculation Agent determines, and following consultation with the Company, that there is no clear market consensus as to whether any rate has replaced three-month LIBOR in customary market usage, the Company will appoint, in the Company’s sole discretion, a new Calculation Agent, who may be an affiliate of the Company, to replace The Bank of New York Mellon, solely in its role as Calculation Agent in respect of the Notes, to determine the Alternative Rate and make any Adjustments thereon, and whose determinations will be binding on the Company, the Trustee and the Holders. If, however, the Calculation Agent determines that three-month LIBOR has been discontinued, but for any reason an Alternative Rate has not been determined, three-month LIBOR will be equal to such rate on the Interest Determination Date when three-month LIBOR was last available on the Reuters LIBOR01 Page, as determined by the Calculation Agent.

 

“Interest Determination Date” means with respect to an Interest Reset Date, the second London Business Day preceding such Interest Reset Date.

 

“Interest Reset Date” means for each Interest Reset Period, other than the first Interest Reset Period, the first day of such Interest Reset Period.

 

“Interest Reset Period” means each period from and including an Interest Payment Date (or, in the case of the first such period, the issue date of the floating rate notes) to but excluding the next succeeding Interest Payment Date.

 

“London Business Day” means any day on which dealings in deposits in U.S. dollars are transacted in the London interbank market.

 

3

 

“Reuters LIBOR01 Page” means the display designated as page LIBOR01 on the Reuters 3000 Xtra (or such other page as may replace the Reuters LIBOR01 Page on that service, or such other service as may be nominated as the information vendor, for the purpose of displaying rates or prices comparable to the London Interbank Offered Rate for U.S. dollar deposits).

 

Additional provisions of this Note are contained on the reverse hereof and such provisions shall have the same effect as though fully set forth in this place.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee for the Notes by manual signature, this Note shall not be entitled to any benefit under the Indenture, or be valid or obligatory for any purpose.

 

4

 

IN WITNESS WHEREOF, AMERICAN EXPRESS COMPANY has caused this instrument to be duly executed under its corporate seal.

 

Dated:           February 27, 2018

 

	
TRUSTEE’S CERTIFICATE
    	
AMERICAN EXPRESS   COMPANY
    
	
OF AUTHENTICATION
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
This is one of the   Securities described
    	
By:
    	
 
    
	
in the within-mentioned   Indenture.
    	
 
    	
David L. Yowan
    
	
 
    	
 
    	
Executive Vice   President and Corporate Treasurer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
THE BANK OF NEW YORK   MELLON
    	
Attest:
    
	
As Trustee
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
Authorized Signatory
    	
Tangela S. Richter
    
	
 
    	
Corporate Secretary
    
						

 

[Form of Floating Rate Global Note]

 

 

REVERSE OF GLOBAL NOTE

 

AMERICAN EXPRESS COMPANY

 

Floating Rate Notes due February 27, 2023

 

$

 

No.

 

This Note is one of a duly authorized issue of debentures, notes or other evidences of indebtedness (hereinafter called “Securities”) of the Company of the series hereinafter specified, which series is initially limited in aggregate principal amount to $400,000,000 all such Securities issued and to be issued under an indenture dated as of August 1, 2007, between the Company and The Bank of New York Mellon, as Trustee (the “Indenture”), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the rights and limitation of rights thereunder of the Holders of Securities and of the rights, obligations, duties and immunities of the Trustee for each series of Securities and of the Company, and the terms upon which Securities are and are to be authenticated and delivered. As provided in the Indenture, Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may be denominated in currencies other than U.S. dollars (including composite currencies), may mature at different times, may bear interest, if any, at different rates, may be subject to different redemption provisions, if any, may be subject to different sinking, purchase or analogous funds, if any, may be subject to different covenants and Events of Default and may otherwise vary as in the Indenture provided or permitted.

 

The Notes may be redeemed prior to Stated Maturity if certain events occur involving United States taxation: If as a result of (a) any change in (including any announced prospective change), or amendment to, the laws (including any regulations or rulings promulgated thereunder) of the United States (or any political subdivision or taxing authority thereof or therein), or any change in (including any announced prospective change), or amendment to, any official position regarding the application or interpretation of such laws, which change or amendment is announced or becomes effective on or after February 22, 2018, or (b) a taxing authority of the United States taking any action, or such action becoming generally known, on or after February 22, 2018, whether or not such action is taken with respect to the Company or any of its affiliates, there is in either case a material increase in the probability that the Company will or may be required to pay additional amounts as provided for below, then the Company may in either case, at its option, redeem, in whole or in part, the Notes, at a redemption price equal to the principal amount of the notes being redeemed, together with any accrued and unpaid interest thereon to the date fixed for redemption (the “Redemption Date”); provided that the Company determines, in its business judgment, that the obligation to pay such additional amounts cannot be avoided by the use of reasonable measures available to it, not including substitution of the obligor under the Notes.  Prior to the publication of any notice of redemption, the Company will deliver to the Trustee an officer’s certificate stating that the Company is entitled to effect a redemption and setting forth a statement of facts showing that the conditions precedent to the Company’s right to redeem have occurred and an opinion of counsel to that effect based on that statement of facts.

 

R-1

 

The Company may, at its option, redeem the Notes in whole or in part on or after the date that is thirty one (31) days prior to the Stated Maturity of the Notes at a redemption price equal to the principal amount of the Notes being redeemed, together with any accrued and unpaid interest thereon to, but excluding, the Redemption Date.

 

Notice of redemption shall be mailed to the registered Holders of the Notes designated for redemption at their addresses as the same shall appear on the Securities Register, not less than 30 days nor more than 60 days prior to the Redemption Date, subject to all the conditions and provisions of the Indenture.

 

In the event of redemption of this Note in part only, a new Note or Notes for the amount of the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof.

 

The Company shall, subject to the exceptions and limitations set forth below, pay as additional interest on the Note, such additional amounts as are necessary in order that the net payment by the Company or a paying agent of the principal of and interest on the Note to a Holder who is a Non-United States Holder (as defined below), after deduction for any present or future tax, assessment or governmental charge of the United States or a political subdivision or taxing authority thereof or therein, imposed by withholding with respect to the payment, will not be less than the amount that would have been payable had no such withholding or deduction been required.

 

The Company’s obligation to pay additional amounts shall not apply (1) to a tax, assessment or governmental charge that would not have been imposed but for the beneficial owner or the Holder, or a fiduciary, settlor, beneficiary, member or shareholder of, or possessor of a power over, the Holder if the Holder is an estate, trust, partnership, limited liability company, corporation or other entity, or a person holding a power over an estate or trust administered by a fiduciary Holder, being considered as (a) being or having been present or engaged in a trade or business in the United States or having or having had a permanent establishment in the United States, (b) having a current or former relationship with the United States, including a relationship as a citizen or resident thereof, (c) being or having been a foreign or domestic personal holding company, a passive foreign investment company or a controlled foreign corporation with respect to the United States, a corporation that has accumulated earnings to avoid United States federal income tax or a private foundation or other tax-exempt organization or (d) being or having been a “10-percent shareholder” of the Company as defined in section 871(h)(3) of the United States Internal Revenue Code of 1986, as amended (the “Code”), or any successor provision or being or having been a bank whose receipt of interest on a note is described in section 881(c)(3)(A) of the Code or any successor provision; (2) to any beneficial owner that is not the sole beneficial owner of the Note, or a portion thereof, or that is a fiduciary, partnership, limited liability company or other fiscally transparent entity, but only to the extent that a beneficiary or settlor with respect to the fiduciary, or a beneficial owner or member of the partnership, limited liability company or other fiscally transparent entity, would not have been entitled to the payment of an additional amount had the beneficiary, settlor, beneficial owner or member received directly its beneficial or distributive share of the payment; (3) to a tax, assessment or governmental charge (including backup withholding) that would not have been imposed but for the failure of the Holder or any other person to comply with

 

R-2

 

certification, information, documentation, reporting or other similar requirements concerning the nationality, residence, identity or connection with the United States of the Holder or beneficial owner of such note, if compliance is required by statute or by regulation of the United States Treasury Department, without regard to any tax treaty, or by an applicable income tax treaty to which the United States is a party as a precondition to partial or complete relief or exemption from such tax, assessment or other governmental charge (including, but not limited to, the failure to provide United States Internal Revenue Service (“IRS”), Form W-8BEN, W-8BEN-E, W-8ECI or any subsequent versions thereof), or any other certification, information, documentation, reporting or other similar requirement under United States income tax laws or regulations that would establish entitlement to otherwise applicable relief or exemption from any tax, assessment or governmental charge; (4) to a tax, assessment or governmental charge that is imposed otherwise than by withholding by the Company or a paying agent from the payment; (5) to a tax, assessment or governmental charge that would not have been imposed or withheld but for a change in law, regulation, or administrative or judicial interpretation that becomes effective more than 10 days after the payment becomes due or is duly provided for, whichever occurs later; (6) to a tax, assessment or governmental charge that is imposed or withheld by reason of the presentation of a note for payment more than 30 days after the date on which such payment becomes due or is duly provided for, whichever occurs later; (7) to an estate, inheritance, gift, sales, excise, transfer, wealth or personal property tax or a similar tax, assessment or governmental charge; (8) to any tax, assessment or other governmental charge required to be withheld by any paying agent from any payment of principal of or interest on any note, if such payment can be made without such withholding by any other paying agent; or (9) in the case of any combination of items (1), (2), (3), (4), (5), (6), (7) and (8).

 

The Notes are subject in all cases to any tax, fiscal or other law or regulation or administrative or judicial interpretation applicable thereto. Except as specifically provided for herein, the Company shall not be required to make any payment with respect to any tax, assessment or governmental charge imposed by any government or a political subdivision or taxing authority thereof or therein.

 

As used herein, the term “United States Holder” means a beneficial owner of a note that is (i) a citizen or resident of the United States, (ii) a corporation or an entity taxable as a corporation for United States federal income tax purposes, that was established under the laws of the United States, any state thereof or the District of Columbia, or (iii) an estate or trust whose world-wide income is subject to United States federal income tax.  If a partnership holds a note, the tax treatment of partners will generally depend upon the status of the partner and the activities of the partnership.  As used here, the term “Non-United States Holder” means a beneficial owner of the Note that is not a United States Holder and is not a partnership.

 

The Indenture contains provisions for defeasance and discharge of the entire principal of all the Notes of any series upon compliance by the Company with certain conditions set forth therein.

 

If an Event of Default with respect to the Notes, as defined in the Indenture, shall occur and be continuing, the principal of all the Notes may be declared due and payable in the manner and with the effect provided in the Indenture.

 

R-3

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes under the Indenture at any time by the Company with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes at the time Outstanding of each series affected thereby.  The Indenture also contains provisions permitting the Holders to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences with respect to a series, provided that the Holders of at least a majority in principal amount of the Notes at the time Outstanding of any series affected by a waiver consent to such waiver. Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the Indenture and subject to certain exceptions therein set forth, this Note is transferable on the Securities Register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company to be maintained for that purpose in the City of New York, New York, or, at the option of the Holder, at the office or agency of the Company to be maintained for that purpose in the City of New York, New York, or at any other office or agency of the Company maintained for that purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Securities Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Notes are issuable only in registered form without coupons in denominations of $2,000.00 and integral multiples of $1,000.00 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Notes are exchangeable for a like aggregate principal amount of Notes of a like tenor and of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection with the registration of such transfer or exchange, other than certain exchanges not involving any transfer.

 

Certain terms used in this Note that are defined in the Indenture have the meanings set forth therein.

 

This Note shall for all purposes be governed by, and construed in accordance with, the laws of the State of New York.

 

R-4

 

The Company, the Trustee for the Notes and any agent of the Company or such Trustee may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the Company, such Trustee nor any such agent shall be affected by notice to the contrary.

 

R-5knl-ex107_20171231

   AMENDED AND RESTATED KNOLL, INC. NON-EMPLOYEE DIRECTOR COMPENSATION PLAN (Effective January 1, 2018)  1. Purpose.  This Amended and Restated Non-Employee Director Compensation Plan (the “Plan”) is intended to promote the interests of Knoll, Inc. (the “Company”) by providing an inducement in the form of fees to certain qualified persons who are not employees of the Company (“Non-Employee Directors”) to serve as members of the Company’s Board of Directors (the “Board”).  In addition, the Plan also seeks to align the interests of these Non- Employee Directors with the interests of the Company’s stockholders by allowing all or a portion of these fees to be paid in shares of common stock of the Company, par value $0.01 per share (the “Common Stock”) and providing for an annual grant of Common Stock subject to certain restrictions (“Restricted Shares”). 2. Effective Date.  The Plan shall be effective as of January 1, 2018 (the “Effective Date”). 3. Administration.  The Plan shall be administered by the Board.  The Board shall, subject to the provisions of the Plan, have the power to construe the Plan, to determine all questions hereunder, and to adopt and amend such rules and regulations for the administration of the Plan as it may deem desirable.  All decisions, determinations and interpretations of the Board shall be final and binding. 4. Eligibility.  Only Non-Employee Directors are eligible to participate in the Plan. 5. Fees Payable to Non-Employee Directors.  The following provisions shall govern the payment to Non-Employee Directors of (i) annual fees, (including fees payable to the Audit Committee Chairman or the Lead Director) (“Annual Fees”) and (ii) reimbursement of reasonable out-of-pocket expenses incurred by the Non-Employee Directors in connection with the performance of their duties as directors (“Expenses”). (a) Annual Fees.  Each person who is a Non-Employee Director shall be entitled to receive without further action by the Board an Annual Fee equal to $50,000 per calendar year (an “Annual Retainer”), as provided below.  In addition, the chairman of the Audit Committee of the Board (the “Audit Committee Chairman”) and the lead independent director (the “Lead Director”) shall each be entitled to receive a supplemental Annual Fee equal to $15,000 per calendar year served in such capacity (the “Audit Chairman Fee” and the “Lead Director Fee”, respectively), as provided below.  The Annual Retainer shall be paid in equal installments of $12,500 in arrears on the last business day of each calendar quarter (each a “Quarterly Payment Date”).  In addition, the Audit Chairman Fee and the Lead Director Fee shall each be paid in equal installments of $3,750 in arrears on each Quarterly Payment Date.  (i) Payment of Annual Fees for Partial Quarters.    In the event a Non- Employee Director serves on the Board for less than the entire quarter, the quarterly portion of Exhibit 10.7 

 

2 the Annual Retainer payable for such quarter shall be prorated based on the number of days in such quarter for which such Non-Employee Director served on the Board.    In the event a Non- Employee Director serves as the Audit Committee Chairman or the Lead Director for less than the entire quarter, the quarterly portion of the Audit Chairman Fee or the Lead Director Fee, as the case may be, payable for such quarter shall be prorated based on the number of days in such quarter for which such Non-Employee Director served as the Audit Committee Chairman or the Lead Director.   (b) Expense Reimbursements.  Each person who is a Non-Employee Director shall also be entitled to receive reimbursement of Expenses.  Expense reimbursements shall be payable in arrears on each Quarterly Payment Date for the Expenses incurred prior to such date.  Reimbursement for Expenses shall be subject to each Non-Employee Director’s submission of a request for reimbursement and all appropriate receipts and/or other documentation required by the Board at least five business days prior to the Quarterly Payment Date for which payment is sought.  Unless otherwise determined by the Board, reimbursement requests submitted late with respect to any Quarterly Payment Date shall be payable on the next Quarterly Payment Date.   (c) Method of Payment.  Except as elected pursuant to Section 5(d) below, Annual Fees shall be payable in cash.  Reimbursement of Expenses shall be payable in cash. (d) Election to Receive Shares of Common Stock in Lieu of Cash.  Non-Employee Directors may elect to receive shares of Common Stock in lieu of all or a portion of the cash payments for Annual Fees (a “Stock Election”).  Any such election must be made by delivery of a Stock Election Form, a form of which is attached hereto as Exhibit A, to the Company (attn: Chief Financial Officer) during a window period under the Company’s Insider Trading Policy and prior to the applicable Quarterly Payment Date with respect to which the election is to take effect.  The number of shares of Common Stock issuable pursuant to a Stock Election shall be equal to the value of the cash elected to be foregone in lieu of Common Stock divided by the Fair Market Value (as defined below) of the Common Stock on each respective Quarterly Payment Date.  Shares of Common Stock issued in lieu of Annual Fees shall be fully vested and unrestricted shares of Common Stock issued pursuant to any stockholder-approved equity plan maintained by the Company, as determined by the Company’s Chief Executive Officer or any of the Company’s other executive officers.  For purposes of the Plan, “Fair Market Value” means, as of any date when the Common Stock is listed on one or more national securities exchanges, the closing price of one share reported on the principal national securities exchange on which such Common Stock is listed and traded on the date of determination.  If the Common Stock is not listed on an exchange, or representative quotes are not otherwise available, the Fair Market Value shall mean the amount determined by the Board in good faith to be the fair market value per share of Common Stock. 6. Grant of Restricted Stock. (a) Annual Grant.  Each calendar year, on the third trading day after the Company’s annual meeting of stockholders, each Non-Employee Director shall automatically be granted, without any further action by the Board, a number of Restricted Shares equal to $90,000 divided by the Fair Market Value of one share of the Common Stock on the date of such grant, rounded to the nearest full share (the “Annual Director Stock Grant”).  The Restricted Shares shall be 

 

3 granted pursuant to any stockholder-approved equity plan maintained by the Company, as determined by the Company’s Chief Executive Officer or any of the Company’s other executive officers.  Except as specifically set forth herein, the annual grant shall be subject to and governed by the terms of the relevant Stock Incentive Plan; provided, however, that any determinations with respect to such Restricted Shares shall be made by the Board.  Except as provided in the Restricted Share Agreement evidencing each Annual Director Stock Grant or as otherwise provided in the relevant equity plan, the Restricted Shares subject to each Annual Director Stock Grant shall become unrestricted and vest at the rate of 50% of the shares granted (rounded down to the nearest full share) on the first anniversary of the date of grant, and the remaining shares granted on the second anniversary of the date of grant; provided, however, that vesting of the Restricted Shares shall occur only to the extent that the Non-Employee Director recipient remains a member of the Board on the respective vesting date.  Each Annual Director Stock Grant shall be made pursuant to an agreement substantially similar to, and shall be subject to such other terms and conditions as set forth in, the Restricted Share Agreement for the applicable Stock Incentive Plan from which the Annual Director Stock Grant is made. 7. Prohibition of Transfer and Assignment.  The right of a Non-Employee Director to the payment of all or a portion of the fees payable or to receive the Common Stock or Restricted Shares granted under this Plan may not be assigned, transferred, pledged or encumbered, other than by will or the laws of descent and distribution and any attempted assignment or transfer shall be null and void. 8. Governing Law.  The Plan shall be construed and interpreted in accordance with the internal laws of the State of Delaware, without reference to the principles of conflicts of law thereof. 9. Termination and Amendment of Plan.  The Board may at any time terminate the Plan or make such modification or amendment thereof as it deems advisable.

 

  EXHIBIT A KNOLL, INC. NON-EMPLOYEE DIRECTOR COMPENSATION PLAN STOCK ELECTION FORM Pursuant to the terms of the Knoll, Inc. Non-Employee Director Compensation Plan (the “Plan”), I hereby elect to receive shares of Common Stock in lieu of Annual Fees as follows.  Capitalized terms shall have the meaning set forth in the Plan. Stock Election in Lieu of Annual Fees I hereby elect to forego $_______ on a quarterly basis or ___% of the Annual Fees due to me on each Quarterly Payment Date and instead receive shares of Common Stock rounded to the nearest full share having an equivalent value. I UNDERSTAND THAT THIS ELECTION SHALL REMAIN IN EFFECT FOR EACH QUARTERLY PAYMENT DATE UNTIL A SUBSEQUENT ELECTION IS FILED WITH THE COMPANY NULLIFYING OR MODIFYING THIS ELECTION. I UNDERSTAND THAT THE SHARES OF COMMON STOCK ISSUED TO ME IN LIEU OF CASH FOR MY ANNUAL FEES WILL BE UNRESTRICTED FOR U.S. FEDERAL TAX PURPOSES AND AS SUCH WILL CONSTITUTE INCOME TO ME IN THE YEAR OF GRANT.      Non-Employee Director

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