Document:

Exhibit 10.1

 

EQUITY COMMONWEALTH

 

TIME-BASED LTIP UNIT AGREEMENT FOR TRUSTEES

 

This Time-Based LTIP Unit Agreement (this “Agreement”) is made effective as of the Grant Date set forth on the Schedule to Time-Based LTIP Unit Agreement (the “Schedule”) attached hereto (the “Grant Date”), between the recipient set forth on the Schedule attached hereto (the “Recipient”), EQC Operating Trust (the “Trust”) and Equity Commonwealth (the “Company”).

 

In consideration of the mutual promises and covenants contained in this Agreement, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

1.                                      Grant of LTIP Units.  Subject to the terms and conditions hereinafter set forth, the terms and conditions of the Equity Commonwealth 2015 Omnibus Incentive Plan, as it may be amended from time to time (the “Plan”), and the terms and conditions of the Declaration of Trust of EQC Operating Trust, as it may be amended from time to time (the “Declaration”), the Company and the Trust together hereby grant to the Recipient, effective as of the Grant Date, an Award of OP Units under the Plan in the form of LTIP Units (as defined in the Declaration).  The number of LTIP Units granted to the Recipient hereunder is set forth on the Schedule attached hereto.  The LTIP Units so granted are hereinafter referred to as the “Time-Based LTIP Units.”  Except as otherwise set forth herein, the Time-Based LTIP Units have the rights, voting powers, restrictions, limitations as to distributions, qualifications, and terms and conditions of redemption and conversion as set forth in the Declaration.  Upon the close of business on the thirtieth (30th) business day following the Grant Date (the “Final Acceptance Date”), if the terms and conditions of the Time-Based LTIP Units set forth in this Agreement, in the Declaration, and in the Plan are accepted, and if the Recipient has paid to the Trust a Capital Contribution (as defined in the Declaration) per Time-Based LTIP Unit in the amount, if any, set forth on the Schedule attached hereto, the Recipient shall receive the number of Time-Based LTIP Units specified on the Schedule attached hereto, effective as of the Grant Date, subject to the vesting, forfeiture, and other conditions set forth in this Agreement, in the Declaration, and in the Plan.  For the avoidance of doubt, the Time-Based LTIP Units granted to the Recipient hereunder constitute OP Units under the Plan for all purposes of the Plan.  The initial Economic Capital Account Balance (as defined in the Declaration) per Time-Based LTIP Unit is set forth on the Schedule attached hereto.  Capitalized terms that are used but not defined herein have the meanings ascribed to them in the Plan.

 

2.                                      Acceptance of Agreement. Upon the close of business on the Final Acceptance Date, if the terms and conditions of the Time-Based LTIP Units set forth in this Agreement and in the Plan are accepted by the Recipient, and if the Recipient has paid to the Trust the Capital Contribution, if any, set forth on the Schedule attached hereto, then the Recipient, unless he or she is already a Unitholder (as defined in the Declaration), shall automatically and without further action on the Recipient’s part, be deemed to be admitted as a Unitholder of the Trust, as of the Grant Date, with beneficial ownership of the Time-Based LTIP Units.  Thereupon, the Recipient shall have all the rights of a Unitholder of the Trust with respect to the Time-Based LTIP Units, as set forth in the Declaration, subject, however, to the restrictions and conditions specified herein, in the Declaration, and in the Plan.  The Recipient shall be designated as an Additional Unitholder (as defined in the Declaration) and shall be bound by the terms and provisions of the Declaration, including the power of attorney set forth in Section 14.11 of Annex A to the Declaration.  In order to confirm receipt of this Agreement, the Recipient must execute this Agreement, which execution shall be deemed to constitute execution of the Declaration.

 

1

 

3.                                      Vesting; Forfeiture.

 

(a)                                 Subject to Sections 3(b) and 3(c) hereof, the Time-Based LTIP Units shall vest on the first anniversary of the Grant Date.  Any Time-Based LTIP Units not vested as of any date are herein referred to as “Unvested Time-Based LTIP Units.”·

 

(b)                                 Subject to Section 3(c) hereof, in the event the Recipient ceases to render services to the Company, whether as a Trustee or otherwise, all Unvested Time-Based LTIP Units shall be forfeited by the Recipient as of the date the Recipient ceases to render such services.

 

(c)                                  Notwithstanding anything in this Agreement to the contrary, immediately upon the occurrence of a Change in Control or the death of the Recipient, all of the Unvested Time-Based LTIP Units shall vest and any forfeiture rights of the Company and the Trust described in Section 3(b) shall lapse in their entirety.  Notwithstanding the foregoing, to the extent necessary for the Recipient to avoid taxes and/or penalties under Section 409A of the Code, a Change in Control shall not be deemed to occur unless it constitutes a “change in control event” within the meaning of Section 1.409A-3(i)(5) of the Treasury Regulations promulgated under Section 409A of the Code.

 

4.                                      Distributions.  The Recipient shall be entitled to distributions on the Time-Based LTIP Units in accordance with the terms and provisions of the Declaration.  For purposes of the Declaration, (i) the Distribution Participation Date (as defined in the Declaration) for the Time-Based LTIP Units (regardless of vesting) shall be the Grant Date, and (ii) for the avoidance of doubt, no Special LTIP Unit Distribution (as defined in the Declaration) shall be payable with respect to the Time-Based LTIP Units.

 

5.                                      Conversion.  The Time-Based LTIP Units shall be subject to conversion into Class A Units (as defined in the Declaration) in accordance with the terms and provisions of the Declaration.

 

6.                                      Transferability of Time-Based LTIP Units.  The Time-Based LTIP Units shall be subject to the restrictions on transfer set forth in the Declaration and the Plan.  Following any transfer of the Time-Based LTIP Units, the Time-Based LTIP Units shall continue to be subject to the same terms and conditions as were applicable immediately prior to such transfer and the provisions of Section 3 hereof relating to termination of service shall continue to be applied with respect to the original Recipient of the Time-Based LTIP Units.  Notwithstanding any transfer made by the Recipient pursuant to this Section 6, the Recipient (or the Recipient’s beneficiary or estate, as applicable) shall be responsible for all income and other taxes associated with the Time-Based LTIP Units.

 

7.                                      Legends.  The records of the Trust evidencing the Time-Based LTIP Units shall bear an appropriate legend, as determined by the Trust in its sole discretion, to the effect that such Time-Based LTIP Units are subject to restrictions as set forth in this Agreement, in the Plan, and in the Declaration.

 

8.                                      Tax Withholding.  The Company and the Trust shall have the right to withhold or cause to be withheld from any compensation paid to the Recipient pursuant to the Plan, the amount of any required withholding taxes in respect of the Time-Based LTIP Units and to take all such other action as the Company and the Trust deem necessary to satisfy all obligations for the payment of such withholding taxes.  The Recipient agrees that if the amount payable to the Recipient by the Company in the ordinary course is insufficient to pay such withholding taxes, then the Recipient shall, upon the request of the Company or the Trust, pay to the Company or the Trust, as applicable, an amount sufficient to satisfy its tax withholding obligations.

 

2

 

9.                                      Investment Representation.  The Recipient hereby makes the covenants, representations, and warranties set forth on Exhibit A attached hereto as of the date of acceptance of this Agreement and on each applicable vesting date, as set forth above, to the Company and the Trust.  All of such covenants, warranties, and representations shall survive the execution of this Agreement by the Recipient.  The Recipient shall immediately notify the Trust upon discovering that any of the representations or warranties set forth on Exhibit A were false when made or have, as a result of changes in circumstances, become false.

 

10.                               Code Section 83(b) Election.  The Recipient hereby agrees to make an election to include in gross income in the year of grant the Time-Based LTIP Units pursuant to Section 83(b) of the Code substantially in the form attached hereto as Exhibit B and to supply the necessary information in accordance with the regulations promulgated thereunder.  The Recipient agrees to file the election (or to permit the Trust to file such election on the Recipient’s behalf) within thirty (30) days after the Grant Date with the IRS Service Center at which the Recipient files his or her personal income tax returns, and to provide an executed copy of such election to the Trust and the Company.  THE RECIPIENT ACKNOWLEDGES THAT IT IS THE RECIPIENT’S SOLE RESPONSIBILITY, AND NOT THE COMPANY’S OR THE TRUST’S, TO FILE A TIMELY ELECTION UNDER CODE SECTION 83(b), EVEN IF THE RECIPIENT REQUESTS THE COMPANY, THE TRUST, OR THEIR RESPECTIVE REPRESENTATIVES TO MAKE THIS FILING ON THE RECIPIENT’S BEHALF.  THE RECIPIENT IS RELYING SOLELY ON THE RECIPIENT’S OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER TO FILE ANY CODE SECTION 83(b) ELECTION AND REGARDING THE ACCURACY AND TIMELINESS OF SUCH FILING.

 

11.                               Profits Interest.  The Company, the Trust, and the Recipient acknowledge and agree that the Time-Based LTIP Units are hereby issued to the Recipient for the performance of services to or for the benefit of the Trust in the Recipient’s capacity as a Unitholder or in anticipation of becoming a Unitholder.  The Company, the Trust, and the Recipient intend that (a) the Time-Based LTIP Units be treated as “profits interests” within the meaning of the Code, Treasury Regulations promulgated thereunder, and any published guidance by the Internal Revenue Service with respect thereto, including, without limitation, Internal Revenue Service Revenue Procedure 93-27, 1993-2 C.B. 343, as clarified by Internal Revenue Service Revenue Procedure 2001-43, 2001-2 C.B. 191; (b) the issuance of such interests not be a taxable event to the Trust or the Recipient as provided in such Revenue Procedures; and (c) the Declaration, the Plan, and this Agreement be interpreted consistently with such intent.  The Recipient is urged to consult with the Recipient’s own tax advisor regarding the tax consequences of the receipt of Time-Based LTIP Units, the vesting of Time-Based LTIP Units, the conversion of Time-Based LTIP Units into Class A Units, the holding of Time-Based LTIP Units and Class A Units, the redemption or other disposition of Class A Units, and the acquisition, holding, and disposition of shares of Stock.

 

12.                               Miscellaneous.

 

(a)                                 Amendments.  Neither this Agreement nor any provision hereof may be changed or modified except by an agreement in writing executed by the Recipient, the Company and the Trust; provided, however, that any change or modification that does not adversely affect the rights hereunder of the Recipient, as they may exist immediately prior to the effective date of such change or modification, may be adopted by the Committee without an agreement in writing executed by the Recipient, and the Committee shall give the Recipient written notice of such change or modification reasonably promptly following the adoption of such change or modification.

 

(b)                                 Binding Effect of the Agreement.  This Agreement shall inure to the benefit of, and be binding upon, the Company, the Trust, the Recipient and their respective estates, heirs, executors, transferees, successors, assigns and legal representatives.

 

3

 

(c)                                  Section 409A.  This Agreement is intended to comply with, or be exempt from, the requirements of Section 409A of the Code and any regulations or other effective guidance promulgated thereunder by the U.S. Department of the Treasury or the Internal Revenue Service, and shall be construed and interpreted in a manner that is consistent with such intent.  To the extent that the Company or the Trust determines that the Recipient would be subject to the additional taxes or penalties imposed on certain nonqualified deferred compensation plans pursuant to Section 409A of the Code as a result of any provision of this Agreement, such provision shall be deemed amended to the minimum extent necessary to avoid application of such additional taxes or penalties. The nature of any such amendment shall be determined by the Committee.

 

(d)                                 Provisions Separable.  In the event that any of the terms of this Agreement shall be or become or is declared to be illegal or unenforceable by any court or other authority of competent jurisdiction, such terms shall be null and void and shall be deemed deleted from this Agreement, and all the remaining terms of this Agreement shall remain in full force and effect.

 

(e)                                  Notices.  Any notice in connection with this Agreement shall be deemed to have been properly delivered if it is in writing and is delivered by hand or by facsimile or sent by registered certified mail, postage prepaid, to the party addressed as follows, unless another address has been substituted by notice so given:

 

	
To the Recipient:
    	
 
    	
To the Recipient’s address as set forth on the   Schedule attached hereto.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
To the Company or the   Trust:
    	
 
    	
Equity Commonwealth
    
	
 
    	
 
    	
Two North Riverside Plaza, Suite 2100
    
	
 
    	
 
    	
Chicago, IL 60606
    
	
 
    	
 
    	
Attn: Secretary
    

 

(f)                                   Construction.  The headings and subheadings of this Agreement have been inserted for convenience only, and shall not affect the construction of the provisions hereof.  All references to sections of this Agreement shall be deemed to refer as well to all subsections which form a part of such section.

 

(g)                                  No Right to Continued Service.  This Agreement shall not be construed as an agreement by the Company, the Trust or any Affiliate to retain in any position the Recipient, nor is the Company, the Trust or any Affiliate obligated to continue retaining in any position the Recipient by reason of this Agreement or the grant of Time-Based LTIP Units to the Recipient hereunder.

 

(h)                                 Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument.

 

(i)                                     Applicable Law.  This Agreement shall be construed and enforced in accordance with the laws of the State of Maryland.

 

4

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or caused this Agreement to be executed under seal, as of the date first above written.

 

 

	
 
    	
EQUITY COMMONWEALTH
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: Orrin S. Shifrin
    
	
 
    	
Title: Executive Vice President, General Counsel and   Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
RECIPIENT:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
Printed Name:
    	
 
    
	
 
    	
Address:
    
				

 

5

 

Exhibit A

 

RECIPIENT’S COVENANTS, REPRESENTATIONS, AND WARRANTIES

 

The Recipient hereby represents, warrants, and covenants as follows:

 

(a)                                 The Recipient has received and had an opportunity to review the following documents (the “Background Documents”):

 

(i)                                     The Company’s latest Annual Report to Shareholders;

 

(ii)                                  The Company’s Proxy Statement for its most recent Annual Meeting of Shareholders;

 

(iii)                               The Company’s Report on Form 10-K for the fiscal year most recently ended;

 

(iv)                              The Company’s Form 10-Q for the most recently ended quarter if one has been filed by the Company with the Securities and Exchange Commission since the filing of the Form 10-K described in clause (iii) above;

 

(v)                                 Each of the Company’s Current Report(s) on Form 8-K, if any, filed since the later of the Form 10-K described in clause (iii) above and the Form 10-Q described in clause (iv) above;

 

(vii)                           The Declaration; and

 

(viii)                        The Plan.

 

The Recipient also acknowledges that any delivery of the Background Documents and other information relating to the Company and the Trust prior to the determination by the Trust of the suitability of the Recipient as a holder of Time-Based LTIP Units shall not constitute an offer of Time-Based LTIP Units until such determination of suitability shall be made.

 

(b)                                 The Recipient hereby represents and warrants that:

 

(i)                                     The Recipient either (A) is an “accredited investor” as defined in Rule 501(a) under the Securities Act of 1933, as amended (the “Securities Act”), or (B) by reason of the business and financial experience of the Recipient, together with the business and financial experience of those persons, if any, retained by the Recipient to represent or advise him, her, or it with respect to the grant to him, her, or it of Time-Based LTIP Units, the potential conversion of Time-Based LTIP Units into Class A Units of the Trust (“Class A Units”) and the potential redemption of such Class A Units for common shares of beneficial interest, par value $0.01 per share, of the Company (“Shares”), has such knowledge, sophistication, and experience in financial and business matters and in making investment decisions of this type that the Recipient (I) is capable of evaluating the merits and risks of an investment in the Trust and potential investment in the Company and of making an informed investment decision, (II) is capable of protecting his, her, or its own interest or has engaged representatives or advisors to assist him, her, or it in protecting his, her, or its interests, and (III) is capable of bearing the economic risk of such investment.

 

(ii)                                  The Recipient understands that (A) the Recipient is responsible for consulting his, her, or its own tax advisors with respect to the application of the U.S. federal income tax laws, and the tax laws of any state, local, or other taxing jurisdiction to which the Recipient is or by reason of the Award of Time-Based LTIP Units may become subject, to his, her, or its

 

 

particular situation; (B) the Recipient has not received or relied upon business or tax advice from the Company, the Trust, or any of their respective employees, officers, directors, shareholders, agents, consultants, advisors, or any affiliates of any of them in their capacity as such; (C) the Recipient provides or will provide services to the Trust on a regular basis and in such capacity has access to such information, and has such experience of and involvement in the business and operations of the Trust, as the Recipient believes to be necessary and appropriate to make an informed decision to accept this Award of Time-Based LTIP Units; and (D) an investment in the Trust and/or the Company involves substantial risks.  The Recipient has been given the opportunity to make a thorough investigation of matters relevant to the Time-Based LTIP Units and has been furnished with, and has reviewed and understands, materials relating to the Trust and the Company and their respective activities (including, but not limited to, the Background Documents).  The Recipient has been afforded the opportunity to obtain any additional information (including any exhibits to the Background Documents) deemed necessary by the Recipient to verify the accuracy of information conveyed to the Recipient.  The Recipient confirms that all documents, records, and books pertaining to his, her, or its receipt of Time-Based LTIP Units which were requested by the Recipient have been made available or delivered to the Recipient.  The Recipient has had an opportunity to ask questions of and receive answers from the Trust and the Company, or from a person or persons acting on their behalf, concerning the terms and conditions of the Time-Based LTIP Units.  The Recipient has relied upon, and is making its decision solely upon, the Background Documents and other written information provided to the Recipient by the Trust or the Company.  The Recipient did not receive any tax, legal, or financial advice from the Trust or the Company and, to the extent it deemed necessary, has consulted with its own advisors in connection with its evaluation of the Background Documents, this Agreement, and the Recipient’s receipt of Time-Based LTIP Units.

 

(iii)                               The Time-Based LTIP Units to be issued, the Class A Units issuable upon conversion of the Time-Based LTIP Units, and any Shares issued in connection with the redemption of any such Class A Units will be acquired for the account of the Recipient for investment only and not with a current view to, or with any intention of, a distribution or resale thereof, in whole or in part, or the grant of any participation therein, without prejudice, however, to the Recipient’s right (subject to the terms of the Time-Based LTIP Units, the Plan, and this Agreement) at all times to sell or otherwise dispose of all or any part of his or her Time-Based LTIP Units, Class A Units, or Shares in compliance with the Securities Act, and applicable state securities laws, and subject, nevertheless, to the disposition of his or her assets being at all times within his or her control.

 

(iv)                              The Recipient acknowledges that (A) neither the Time-Based LTIP Units to be issued, nor the Class A Units issuable upon conversion of the Time-Based LTIP Units, have been registered under the Securities Act or state securities laws by reason of a specific exemption or exemptions from registration under the Securities Act and applicable state securities laws and, if such Time-Based LTIP Units or Class A Units are represented by certificates, such certificates will bear a legend to such effect, (B) the reliance by the Trust and the Company on such exemptions is predicated in part on the accuracy and completeness of the representations and warranties of the Recipient contained herein, (C) such Time-Based LTIP Units, or Class A Units, therefore, cannot be resold unless registered under the Securities Act and applicable state securities laws, or unless an exemption from registration is available, (D) there is no public market for such Time-Based LTIP Units and Class A Units, (E) neither the Trust nor the Company has made any representations, warranties, or covenants whatsoever as to whether any exemption from the Securities Act, including, without limitation, any exemption for limited sales in routine brokers’ transactions pursuant to Rule 144 of the Securities Act (“Rule 144”), will be available, and that if an exemption under Rule 144 is available at all, it will not be available until all applicable terms and conditions of Rule 144 have been satisfied, (F) neither the Trust nor the Company has made any agreements, covenants, or undertakings whatsoever to register the transfer of the Time-Based LTIP Units under the Securities Act, and

 

 

(G) neither the Trust nor the Company has any obligation or intention to register such Time-Based LTIP Units or the Class A Units issuable upon conversion of the Time-Based LTIP Units under the Securities Act or any state securities laws or to take any action that would make available any exemption from the registration requirements of such laws, except that, upon the redemption of the Class A Units for Shares, the Company intends to issue such Shares under the Plan and pursuant to a Registration Statement on Form S-8 under the Securities Act, to the extent that (i) the Recipient is eligible to receive such Shares under the Plan at the time of such issuance, and (ii) the Company has filed an effective Form S-8 Registration Statement with the Securities and Exchange Commission registering the issuance of such Shares.  The Recipient hereby acknowledges that because of the restrictions on transfer or assignment of such Time-Based LTIP Units acquired hereby and the Class A Units issuable upon conversion of the Time-Based LTIP Units which are set forth in the Declaration or this Agreement, the Recipient may have to bear the economic risk of his, her, or its ownership of the Time-Based LTIP Units acquired hereby and the Class A Units issuable upon conversion of the Time-Based LTIP Units for an indefinite period of time.

 

(v)                                 The Recipient has determined that the Time-Based LTIP Units are a suitable investment for the Recipient.

 

(vi)                              No representations or warranties have been made to the Recipient by the Trust or the Company, or any employee, officer, director, shareholder, agent, consultant, advisors, or affiliate of any of them, and the Recipient has received no information relating to an investment in the Trust or the Time-Based LTIP Units except the information specified in paragraph (a) above.

 

(c)                                  So long as the Recipient holds any Time-Based LTIP Units, the Recipient shall disclose to the Trust in writing such information as may be reasonably requested with respect to ownership of Time-Based LTIP Units as the Trust may deem reasonably necessary to ascertain and to establish compliance with provisions of the Internal Revenue Code of 1986, as amended (the “Code”), applicable to the Trust or to comply with requirements of any other appropriate taxing authority.

 

(e)                                  The address set forth on the Schedule attached to this Agreement is the address of the Recipient’s principal residence, and the Recipient has no present intention of becoming a resident of any country, state, or jurisdiction other than the country and state in which such residence is sited.

 

(f)                                   The representations of the Recipient as set forth above are true and complete to the best of the information and belief of the Recipient, and the Company and the Trust shall be notified promptly of any changes in the foregoing representations.

 

 

Exhibit B

 

ELECTION UNDER SECTION 83(b) OF THE INTERNAL REVENUE CODE

 

The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:

 

1.                                      The name, address, and social security number of the undersigned:

 

Name:

 

Address:

 

Social Security No.:

 

2.                                      Description of property with respect to which the election is being made:

 

The election is being made with respect to             Time-Based LTIP Units in EQC Operating Trust (the “Trust”).

 

3.                                      The date on which the property was transferred is                             , 2017.

 

4.                                      The taxable year to which this election relates is calendar year 2017.

 

5.                                      Nature of restrictions to which the property is subject:

 

(a)                                 With limited exceptions, until the Time-Based LTIP Units vest, the Time-Based LTIP Units may not be transferred in any manner without the consent of the Trust.

 

(b)                                 The Time-Based LTIP Units are subject to the provisions of a Time-Based LTIP Unit Agreement between the undersigned, the Trust, and Equity Commonwealth. The Time-Based LTIP Units are subject to vesting and forfeiture terms and conditions under the terms of the Time-Based LTIP Unit Agreement.

 

6.                                      The fair market value at time of transfer (determined without regard to any restrictions other than restrictions which by their terms will never lapse) of the Time-Based LTIP Units with respect to which this election is being made was $   per Time-Based LTIP Unit.

 

7.                                      The amount paid by the Taxpayer for the Time-Based LTIP Units was $   per Time-Based LTIP Unit.

 

8.                                      A copy of this statement has been furnished to the Trust and to its sole trustee, Equity Commonwealth.

 

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
(Sign Name)
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(Print Name)
    

 

 

PROCEDURES FOR RECIPIENT MAKING ELECTION

UNDER INTERNAL REVENUE CODE SECTION 83(b)

 

The following procedures must be followed with respect to the attached form for making an election under Internal Revenue Code Section 83(b) in order for the election to be effective:(1)

 

1.              You must file one copy of the completed election form with the IRS Service Center where you file your federal income tax returns within 30 days after the Grant Date of your Time-Based LTIP Units.

 

2.              At the same time you file the election form with the IRS, you must also give a copy of the election form to the Trust.

 

(1)  The election may create tax consequences for you.  You are advised to consult your tax advisor.

 

 

Schedule to Time-Based LTIP Unit Agreement

 

(See Attachment)

 

 

	
Company Name
    	
 
    	
Equity Commonwealth
    
	
 
    	
 
    	
 
    
	
Recipient Id
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Recipient Name
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Recipient Address
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Grant Type
    	
 
    	
Time-Based LTIP Unit Award
    
	
 
    	
 
    	
 
    
	
Number of Units
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Grant Date
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Capital Contribution Amount   (per Unit)
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Economic Capital   Account Balance (per Unit)Exhibit 10.1

  

Regional Brands Inc.

Amended and Restated 2016 Equity Incentive Plan

 

(Adopted and effective
April 8, 2016)

(Amended June 15, 2017)

 

ARTICLE 1

Establishment, Purpose, and Duration

 

1.1              
Establishment of the Plan. Regional Brands Inc., a Delaware corporation (together with any successor thereto as provided
in Article 15, hereinafter referred to as the “Company”), hereby establishes an equity incentive plan to be known as
the Amended and Restated 2016 Equity Incentive Plan (hereinafter referred to as the “Plan”), as set forth in this document.
The Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock and Restricted Stock Units
(each as defined below).

 

The Plan is adopted and is effective as
of April 8, 2016 (the “Effective Date”) and shall remain in effect as provided in Section 1.3; provided, however,
no Option (as defined below) may be exercised and no other Award (as defined below) may be exercised or otherwise paid until the
Plan has been approved by the Company’s stockholders.

 

1.2              
Purpose of the Plan. The purpose of the Plan is to promote the interests of the Company and its stockholders by aligning
the interests of the Participants, through the ownership of Shares (as defined below), with the interests of the Company’s
stockholders, and by enabling the Company to motivate and retain Employees (as defined below), Directors (as defined below), independent
contractors and advisors upon whose judgment, initiative, and efforts the financial success and growth of the business of the Company
largely depend.

 

1.3              
Duration of the Plan. Unless sooner terminated as provided herein, the Plan shall terminate 10 years from the Effective
Date. After the Plan is terminated, no Awards may be granted but Awards previously granted shall remain outstanding in accordance
with their applicable terms and conditions and the Plan’s terms and conditions.

 

ARTICLE 2

Definitions

 

Whenever used in the Plan, the following
terms shall have the meanings set forth below, and when the meaning is intended, the initial letter of the word shall be capitalized.

 

2.1              
“Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 promulgated under the General
Rules and Regulations under the Exchange Act.

 

2.2              
“Annual Award Limit” or “Annual Award Limits” have the meaning set forth in Section
4.3.

 

2.3              
“Award” means, individually or collectively, a grant under the Plan of Nonqualified Stock Options, Incentive
Stock Options, Restricted Stock or Restricted Stock Units, in each case subject to the terms of the Plan.

 

2.4              
“Beneficial Owner” or “Beneficial Ownership” shall have the meaning ascribed to such
term in Rule 13d-3 promulgated under the General Rules and Regulations under the Exchange Act.

 

     

     

    

 

2.5              
“Board” or “Board of Directors” means the Board of Directors of the Company.

 

2.6              
“Change in Control” means a Change in Control as defined in Article 12.

 

2.7              
“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rulings and regulations
issued thereunder.

 

2.8              
“Committee” means the Compensation Committee of the Board, or any other committee designated by the Board
to administer the Plan. The members of the Committee shall be appointed from time to time by and shall serve at the discretion
of the Board. If the Company is subject to the requirements of Section 16 of the Exchange Act or Section 162(m) of the Code, or
the listing requirements of a national securities exchange, as applicable, the Committee shall consist solely of two or more directors
who are “nonemployee directors” under Rule 16b-3 promulgated under the Exchange Act, “outside directors”
as defined under Section 162(m) of the Code, and “independent directors” under the listing requirements of such national
securities exchange, or any similar rule or listing requirement that may be applicable to the Company from time to time.

 

2.9              
“Company” has the meaning set forth in Section 1.1.

 

2.10          
“Covered Employee” means a Participant who is a “covered employee,” as defined in Section
162(m) of the Code.

 

2.11          
“Director” means a member of the Board of Directors of the Company, its Affiliates and/or Subsidiaries.

 

2.12          
“Disability” means the disability of the Participant such as would entitle the Participant to receive
disability income benefits pursuant to any long-term disability plan of the Company or Subsidiary then covering the Participant,
or, if no such plan exists or is applicable to the Participant, the permanent and total disability of the Participant within the
meaning of Section 22(e)(3) of the Code.

 

2.13          
“Effective Date” has the meaning set forth in Section 1.1.

 

2.14          
“Employee” means any employee of the Company, its Affiliates and/or Subsidiaries.

 

2.15          
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

2.16          
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor
act thereto.

 

2.17          
“Evidence of Award” means an agreement, certificate, resolution or other type or form of writing or other
evidence approved by the Committee which sets forth the terms and conditions of an Award. An Evidence of Award may be in any electronic
medium, may be limited to a notation on the books and records of the Company and, with the approval of the Committee, need not
be signed by a representative of the Company or a Participant.

 

    	 	2	 

     

    

 

2.18          
“Fair Market Value” or “FMV” means the last sales price reported for the Shares on
the applicable date as reported on the principal national securities exchange in the United States on which the Shares are then
traded, or, if such date is not a trading day, the last prior day on which the Shares were so traded; or if not so listed, the
mean between the closing bid and asked prices of publicly traded Shares in the over-the-counter market, or, if such bid and asked
prices shall not be available, as reported by any nationally recognized quotation service selected by the Company, or as determined
by the Committee in a manner consistent with the provisions of the Code or as otherwise determined by the Committee in its reasonable
discretion, or, in determining the Option Price for Options granted on or about the Effective Date, the per share purchase price
of the Shares set forth in the Securities Purchase Agreement, dated as of April 8, 2016, by and among the Company and the investors
party thereto. If, however, the required accounting standards used to account for equity Awards granted to Participants are substantially
modified subsequent to the Effective Date such that fair value accounting for such Awards becomes required, the Committee shall
have the ability to determine an Award’s FMV based on the relevant facts and circumstances, but with respect to any Options
in a manner that would not subject an otherwise exempt award to the Section 409A Rules.

 

2.19          
“Full Value Award” means an Award other than in the form of an Option, and which is settled by the issuance
of Shares.

 

2.20          
“Incentive Stock Option” means an Option that is intended to qualify as an “incentive stock option”
under Section 422 of the Code.

 

2.21          
“Nonqualified Stock Option” means an Option that is not intended to meet the requirements of Section
422 of the Code, or that otherwise does not meet such requirements.

 

2.22          
“Option” means the right to purchase Shares granted to a Participant in accordance with Article 6. Options
granted under the Plan may be Nonqualified Stock Options, Incentive Stock Options or a combination thereof.

 

2.23          
“Option Price” means the price at which a Share may be purchased by a Participant pursuant to an Option.

 

2.24          
“Participant” means any eligible Person as set forth in Section 5.1 to whom an Award is granted.

 

2.25          
“Performance-Based Compensation” means compensation under an Award that satisfies the requirements of
Section 162(m) of the Code for deductibility of remuneration paid to Covered Employees.

 

2.26          
“Performance Measures” means measures as described in Article 8 on which the performance goals are based
and which are approved by the Company’s stockholders pursuant to the Plan in order to qualify Awards as Performance-Based
Compensation.

 

2.27          
“Performance Period” means the period of time during which the performance goals must be met in order
to determine the degree of payout and/or vesting with respect to an Award.

 

2.28          
“Period of Restriction” means the period when Restricted Stock or Restricted Stock Units are subject
to a “substantial risk of forfeiture” within the meaning of Section 83 of the Code (based on the passage of time, the
achievement of performance goals, or upon the occurrence of other events as determined by the Committee, in its discretion) or
other similar term or condition.

 

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.

 

    	 	3	 

     

    

 

2.31          
“Plan Year” means the Company’s fiscal year that begins January 1 and ends December 31.

 

2.32          
“Restricted Stock” means Shares granted or sold to a Participant pursuant to Article 7 as to which the
Period of Restriction has not lapsed.

 

2.33          
“Restricted Stock Unit” means a unit granted or sold to a Participant pursuant to Article 7 as to which
the Period of Restriction has not lapsed.

 

2.34          
“Section 409A Rules” means the rules promulgated pursuant to Section 409A of the Code.

 

2.35          
“Securities Act” means the Securities Act of 1933, as amended from time to time, or any successor act
thereto.

 

2.36          
“Share” means a share of common stock of the Company, $0.00001 par value per share.

 

2.37          
“Subsidiary” means a corporation, company or other entity (i) more than 50% of whose outstanding shares
or securities (representing the right to vote for the election of directors or other managing authority) are, or (ii) which does
not have outstanding shares or securities (as may be the case in a partnership, joint venture or unincorporated association), but
more than 50% of whose ownership interest representing the right generally to make decisions for such other entity is, now or hereafter,
owned or controlled, directly or indirectly, by the Company, except that for purposes of determining whether any person may be
a Participant for purposes of any grant of Incentive Stock Options, “Subsidiary” means any corporation in which at
the time the Company owns or controls, directly or indirectly, more than 50% of the total combined voting power represented by
all classes of stock issued by such corporation.

 

ARTICLE 3

Administration

 

3.1              
General. The Committee shall be responsible for administering the Plan, subject to this Article 3 and the other provisions
of the Plan. The act or determination of a majority of the Committee shall be the act or determination of the Committee and any
decision reduced to writing and signed by all of the members of the Committee shall be fully effective as if it had been made by
a majority at a meeting duly held. The Committee may employ attorneys, consultants, accountants, agents, and other Persons, any
of whom may be an Employee, and the Committee, the Company, and its officers and Directors shall be entitled to rely upon the advice,
opinions, or valuations of any such Persons. All actions taken and all interpretations and determinations made by the Committee
shall be final and binding upon the Participants, the Company, and all other interested Persons.

 

3.2              
Authority of the Committee. The Committee shall have full and exclusive discretionary power to interpret the terms
and the intent of the Plan and any Evidence of Award or other agreement or document ancillary to or in connection with the Plan,
to determine eligibility for Awards and to adopt such rules, regulations, forms, instruments and guidelines for administering the
Plan as the Committee may deem necessary or proper. Such authority shall include, but not be limited to, selecting Award recipients,
establishing all Award terms and conditions, including the terms and conditions set forth in an Evidence of Award, and, subject
to Article 13, adopting modifications and amendments to the Plan or any Evidence of Award, including, without limitation, any that
are necessary to comply with the laws of the countries and other jurisdictions in which the Company or any of its Affiliates or
Subsidiaries operates. If the Committee does not exist or is unable to act for any reason, then the Plan shall be administered
by the Board, and references herein to the Committee shall be deemed to be references to the Board.

 

    	 	4	 

     

    

 

ARTICLE 4

Shares Subject to the Plan and Maximum Awards

 

4.1              
Number of Shares Available for Awards.

 

(a)               
Subject to adjustment as provided in Section 4.4 herein, the maximum number of Shares available for issuance to Participants
under the Plan shall be 130,000 Shares. The maximum number of Shares that may be issued with respect to the exercise of Incentive
Stock Options is 130,000 Shares.

 

(b)               
Of the Shares reserved for issuance under Section 4.1(a) of the Plan, all of the reserved Shares may be issued pursuant
to Full Value Awards.

 

4.2              
Share Usage. Shares covered by an Award shall only be counted as used to the extent they are actually issued. Any
Shares related to Awards which terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of such Shares
or are settled in cash in lieu of Shares shall be available again for grant under the Plan. Moreover, if the Option Price of any
Option granted under the Plan or the tax withholding requirements with respect to any Award granted under the Plan are satisfied
by tendering Shares to the Company (by either actual delivery or by attestation), only the number of Shares issued, net of the
Shares tendered, if any, will be deemed delivered for purposes of determining the maximum number of Shares available for delivery
under the Plan and any Shares so tendered shall again be available for issuance under the Plan. The Shares available for issuance
under the Plan may be authorized and unissued Shares, treasury Shares or a combination thereof.

 

4.3              
Annual Award Limits. Subject to the terms of Section 4.1 hereof, the maximum number of Shares that may be subject
to Awards (including Options) granted in any Plan Year to any individual Participant shall be 15,000 Shares.

 

4.4              
Adjustments in Authorized Shares. In the event of any corporate event or transaction (including, but not limited
to, a change in the shares of the Company or the capitalization of the Company) such as a merger, consolidation, reorganization,
recapitalization, separation, stock dividend, stock split, reverse stock split, split-up, spin-off, or other distribution of stock
or property of the Company, combination of Shares, exchange of Shares, dividend in kind, or other like change in capital structure
or distribution (other than normal cash dividends) to stockholders of the Company, or any similar corporate event or transaction,
the Committee in order to prevent dilution or enlargement of Participants’ rights under the Plan, shall substitute or adjust,
as applicable, the number and kind of Shares that may be issued under the Plan or under particular forms of Awards, the number
and kind of Shares subject to outstanding Awards, the Option Price applicable to outstanding Awards, the Annual Award Limits and/or
other value determinations applicable to outstanding Awards.

 

Except as otherwise provided by Section
162(m) of the Code, the Committee, in its sole discretion, may also make appropriate adjustments in the terms of any Awards under
the Plan to reflect or related to such changes or distributions and to modify any other terms of outstanding Awards. The determination
of the Committee as to the foregoing adjustments, if any, shall be conclusive and binding on Participants under the Plan.

 

    	 	5	 

     

    

 

Subject to the provisions of Article 13,
without affecting the number of Shares reserved or available hereunder, the Committee may authorize the issuance or assumption
of benefits under the Plan in connection with any merger, consolidation, acquisition of property or stock, or reorganization upon
such terms and conditions as it may deem appropriate, subject to compliance with the rules under Sections 422 and 424 of the Code
and the Section 409A Rules, where applicable.

 

ARTICLE 5

Eligibility and Participation

 

5.1              
Eligibility. Individuals eligible to participate in the Plan include all Employees and nonemployee Directors, and
all independent contractors and advisors to the Company, its Affiliates and/or Subsidiaries.

 

5.2              
Actual Participation. Subject to the provisions of the Plan, the Committee may, from time to time, select from all
eligible individuals those to whom Awards shall be granted and shall determine, in its sole discretion, the nature of, any and
all terms permissible by law, and the amount of each Award. In making this determination, the Committee may consider any factors
it deems relevant, including, without limitation, the office or position held by a Participant, the Participant’s degree
of responsibility for and contribution to the growth and success of the Company or any Subsidiary or Affiliate, the Participant’s
length of service, promotions and potential.

 

ARTICLE 6

Options

 

6.1              
Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Participants in such
number, and upon such terms, and at any time and from time to time as shall be determined by the Committee, in its sole discretion;
provided that Incentive Stock Options may be granted only to eligible Employees of the Company or of any parent or subsidiary
corporation (as permitted under Sections 422 and 424 of the Code).

 

6.2              
Evidence of Award. Each Option grant shall be evidenced by an Evidence of Award that shall specify the Option Price,
the maximum duration of the Option, the number of Shares to which the Option pertains, the conditions upon which an Option shall
become vested and exercisable, and such other provisions as the Committee shall determine which are not inconsistent with the terms
of the Plan. The Evidence of Award also shall specify whether the Option is intended to be an Incentive Stock Option or a Nonqualified
Stock Option.

 

6.3              
Option Price. The Option Price for each grant of an Option under the Plan shall be as determined by the Committee.
The Option Price may not be less than 100% of the Fair Market Value of the Shares on the date of grant. With respect to a Participant
who owns, directly or indirectly, more than 10% of the total combined voting power of all classes of the capital stock of the Company,
or any parent or subsidiary corporation of the Company, as defined in Section 424 of the Code, the Option Price of Shares subject
to an Incentive Stock Option may not be less than 110% of the Fair Market Value of a Share on the date of grant.

 

    	 	6	 

     

    

 

6.4              
Duration of Options. Except as otherwise provided in Section 422 of the Code with respect to any Incentive Stock
Option, each Option granted to a Participant shall expire at such time as the Committee shall determine at the time of grant; provided,
however, that no Option shall be exercisable later than the 15th anniversary date of its grant. In the case of
an Incentive Stock Option, no Option shall be exercisable later than the 10th anniversary of the date of grant, except
with respect to a Participant who owns, directly or indirectly, more than 10% of the total combined voting power of all classes
of the capital stock of the Company, or any parent or subsidiary corporation of the Company, as defined in Section 424 of the Code,
in which case no Option shall be exercisable later than the 5th anniversary of its date of grant.

 

6.5              
Exercise of Options. Options granted under this Article 6 shall be exercisable at such times and be subject to such
restrictions and conditions as the Committee shall in each instance approve, which terms and restrictions need not be the same
for each grant or for each Participant. After an Option is granted, the Committee, in its sole discretion, may accelerate the exercisability
of the Option.

 

6.6              
Payment. Options granted under this Article 6 shall be exercised by the delivery of a notice of exercise to the Company
or an agent designated by the Company in a form specified or accepted by the Committee, or by complying with any alternative procedures
which may be authorized by the Committee, setting forth the number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.

 

A condition of the issuance of the Shares
as to which an Option shall be exercised shall be the Participant’s payment of the Option Price and any applicable tax withholding.
The Option Price of any Option shall be payable to the Company in full either: (a) in cash or its equivalent; (b) by tendering
(either by actual delivery or attestation) previously acquired Shares having an aggregate Fair Market Value at the time of exercise
equal to the Option Price; (c) by a combination of (a) and (b); or (d) any other method approved or accepted by the Committee in
its sole discretion, including, without limitation, if the Committee so determines, (i) a cashless (broker-assisted) exercise,
or (ii) a reduction in the number of Shares that would otherwise be issued by such number of Shares having in the aggregate a Fair
Market Value at the time of exercise equal to the portion of the Option Price being so paid.

 

Subject to any governing rules or regulations,
as soon as practicable after receipt of written notification of exercise and full payment (including satisfaction of any applicable
tax withholding), the Company shall deliver to the Participant evidence of book entry Shares, or upon the Participant’s request,
Share certificates in an appropriate amount based upon the number of Shares purchased under the Option(s).

 

Unless otherwise determined by the Committee,
all payments under all of the methods indicated above shall be paid in United States dollars.

 

6.7              
Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant
to the exercise of an Option granted under this Article 6 as it may deem advisable and specify in the Evidence of Award, including,
without limitation, minimum holding period requirements, restrictions under applicable federal securities laws, under the requirements
of any stock exchange or market upon which such Shares are then listed and/or traded, or under any blue sky or state securities
laws applicable to such Shares.

 

6.8              
Termination of Employment. To the extent consistent with the Section 409A Rules and Section 162(m) of the Code, each
Evidence of Award shall set forth the extent to which the Participant shall have the right to exercise the Option following termination
of the Participant’s employment or provision of services to the Company, its Affiliates, and/or its Subsidiaries, as the
case may be. Such provisions shall be determined in the sole discretion of the Committee, shall be included in the Evidence of
Award entered into with each Participant, need not be uniform among all Options issued pursuant to this Article 6, and may reflect
distinctions based on the reasons for termination.

 

    	 	7	 

     

    

 

6.9              
Notification of Disqualifying Disposition. If any Participant shall make any disposition of Shares issued pursuant
to the exercise of an Incentive Stock Option under the circumstances described in Section 421(b) of the Code (relating to certain
disqualifying dispositions), such Participant shall notify the Company of such disposition prior to the end of the calendar year
in which such disposition occurred.

 

6.10          
Transferability of Options. Except as otherwise provided in a Participant’s Evidence of Award or otherwise
at any time by the Committee, no Option granted under this Article 6 may be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated, other than by will or by the laws of descent and distribution or as otherwise required by law; provided
that the Board or Committee may permit further transferability, on a general or a specific basis, and may impose conditions and
limitations on any permitted transferability. Further, except as otherwise provided in a Participant’s Evidence of Award
or otherwise at any time by the Committee, or unless the Board or Committee decides to permit further transferability, all Options
granted to a Participant under this Article 6 shall be exercisable during his or her lifetime only by such Participant. With respect
to those Options, if any, that are permitted to be transferred to another Person, references in the Plan to exercise or payment
of the Option Price by the Participant shall be deemed to include, as determined by the Committee, the Participant’s permitted
transferee.

 

ARTICLE 7

Restricted Stock and Restricted Stock Units

 

7.1              
Grant of Restricted Stock or Restricted Stock Units. Subject to the terms and provisions of the Plan, the Committee,
at any time and from time to time, may grant Shares of Restricted Stock and/or Restricted Stock Units to Participants in such amounts
as the Committee shall determine. Restricted Stock Units shall represent the right of a Participant to receive payment upon the
lapse of the Period of Restriction.

 

7.2              
Restricted Stock or Restricted Stock Unit Agreement. Each Restricted Stock and/or Restricted Stock Unit grant shall
be evidenced by an Evidence of Award that shall specify the Period(s) of Restriction, the number of Shares of Restricted Stock
or the number of Restricted Stock Units granted, and such other provisions as the Committee shall determine.

 

7.3              
Transferability. Except as provided in the Plan or an Evidence of Award, the Shares of Restricted Stock and/or Restricted
Stock Units granted herein may not be sold, transferred, pledged, assigned or otherwise alienated or hypothecated until the end
of the applicable Period of Restriction established by the Committee and specified in the Evidence of Award (and in the case of
Restricted Stock Units until the date of delivery or other payment), or upon earlier satisfaction of any other conditions, as specified
by the Committee, in its sole discretion, and set forth in the Evidence of Award or otherwise at any time by the Committee. All
rights with respect to the Restricted Stock and/or Restricted Stock Units granted to a Participant under the Plan shall be available
during his or her lifetime only to such Participant, except as otherwise provided in an Evidence of Award or at any time by the
Committee.

 

7.4              
Other Restrictions. The Committee shall impose such other conditions and/or restrictions on any Shares of Restricted
Stock or Restricted Stock Units granted pursuant to the Plan as it may deem advisable, including, without limitation, a requirement
that Participants pay a stipulated purchase price for each Share of Restricted Stock or each Restricted Stock Unit, restrictions
based upon the achievement of specific performance goals, time-based restrictions on vesting following the attainment of the performance
goals, time-based restrictions and/or restrictions under applicable laws or under the requirements of any stock exchange or market
upon which such Shares are listed or traded, or holding requirements or sale restrictions placed on the Shares by the Company upon
vesting of such Restricted Stock or Restricted Stock Units.

 

    	 	8	 

     

    

 

In the event that the vesting date occurs
on a date which is not a trading day on the principal securities exchange or quotation system on which the Shares are then traded,
the Fair Market Value on the last prior trading date will be utilized for cost basis.

 

To the extent deemed appropriate by the
Committee, the Company may retain the certificates representing Shares of Restricted Stock in the Company’s possession until
such time as all conditions and/or restrictions applicable to such Shares have been satisfied or lapse.

 

Except as otherwise provided in this Article
7, Shares of Restricted Stock covered by each Restricted Stock Award shall become freely transferable by the Participant after
all conditions and restrictions applicable to such Shares have been satisfied or lapse (including satisfaction of any applicable
tax withholding obligations), and Restricted Stock Units shall be paid in cash, Shares or a combination of cash and Shares as the
Committee, in its sole discretion shall determine.

 

7.5              
Certificate Legend. In addition to any legends placed on certificates pursuant to Section 7.4, each certificate representing
Shares of Restricted Stock granted pursuant to the Plan may bear a legend as determined by the Committee in its sole discretion.

 

7.6              
Voting and Dividend Rights. Unless otherwise determined by the Committee and set forth in a Participant’s Evidence
of Award, to the extent permitted or required by law, as determined by the Committee, Participants holding Shares of Restricted
Stock granted hereunder shall have the right to exercise full voting and dividend rights with respect to those Shares during the
Period of Restriction. A Participant shall have no voting or dividend rights with respect to any Restricted Stock Units granted
hereunder.

 

7.7              
Termination of Employment. To the extent consistent with the Section 409A Rules and Section 162(m) of the Code, each
Evidence of Award shall set forth the extent to which the Participant shall have the right to retain Restricted Stock and/or Restricted
Stock Units following termination of the Participant’s employment with or provision of services to the Company, its Affiliates
and/or its Subsidiaries, as the case may be. Such provisions shall be determined in the sole discretion of the Committee, shall
be included in the Evidence of Award entered into with each Participant, need not be uniform among all Shares of Restricted Stock
or Restricted Stock Units issued pursuant to the Plan, and may reflect distinctions based on the reasons for termination.

 

7.8              
Section 83(b) Election. The Board may provide in an Evidence of Award that the Award of Restricted Stock is conditioned
upon the Participant making or refraining from making an election with respect to the Award under Section 83(b) of the Code. If
a Participant makes an election pursuant to Section 83(b) of the Code concerning a Restricted Stock Award, the Participant shall
be required to file promptly a copy of such election with the Company.

 

ARTICLE 8

Performance Measures

 

8.1              
Performance Awards Granted to Covered Employees. If and to the extent that the Committee determines that an Award
to be granted to a Participant who is designated by the Committee as having the potential to be a Covered Employee should qualify
as Performance-Based Compensation for purposes of Section 162(m) of the Code, the grant, exercise and/or settlement of such Award
shall be contingent upon achievement of pre-established Performance Measures and other terms set forth in Section 8.2.

 

    	 	9	 

     

    

 

8.2              
Performance Measures. Unless and until the Committee proposes for stockholder vote and the stockholders approve a
change in the general Performance Measures set forth in this Article 8, the performance goals upon which the payment or vesting
of an Award to a Covered Employee that is intended to qualify as Performance-Based Compensation shall include one or more of the
following Performance Measures: (a) net earnings or net income (before or after taxes and interest/investments); (b) earnings per
share; (c) earnings per share growth; (d) net sales growth; (e) net earnings or net income growth (before or after taxes and interest/investment);
(f) net operating profit; (g) return measures (including return on assets, capital, equity or sales); (h) cash flow (including
operating cash flow, free cash flow, and cash flow return on capital); (i) earnings before or after taxes, interest, depreciation,
and/or amortization; (j) gross or operating margins or growth thereof; (k) productivity ratios; (l) share price (including growth
measures and total stockholder return); (m) expense targets; (n) operating efficiency; (o) customer satisfaction; (p) revenue growth;
(q) operating profit growth; (r) working capital targets; (s) economic value added; (t) sale or disposition of assets; and (u)
acquisition of key assets.

 

Any Performance Measure(s) may be used to
measure the performance of the Company, its Subsidiary and/or its Affiliate as a whole or any business unit of the Company, its
Subsidiary and/or its Affiliate or any combination thereof, as the Committee may deem appropriate, or any of the above Performance
Measures as compared to the performance of a group of comparable companies, or published or special index that the Committee, in
its sole discretion, deems appropriate, or the Company may select Performance Measure (l) above as compared to various stock market
indices. The Committee also has the authority to provide for accelerated vesting of any Award based on the achievement of performance
goals pursuant to the Performance Measures specified in this Article 8.

 

8.3              
Evaluation of Performance. The Committee may provide in any such Award that any evaluation of performance may include
or exclude any of the following events that occurs during a Performance Period: (a) asset write-downs; (b) litigation or claim
judgments or settlements; (c) the effect of changes in tax laws, accounting principles, or other laws or provisions affecting reported
results; (d) any reorganization and restructuring programs; (e) extraordinary nonrecurring items as described in Accounting Standards
Codification Topic 225-20 (formerly, Accounting Principles Board Opinion No. 30) and/or in management’s discussion and analysis
of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable
year; (f) acquisitions or divestitures; and (g) foreign exchange gains and losses. To the extent such inclusions or exclusions
affect Awards to Covered Employees, they shall be prescribed in a form that meets the requirements of Section 162(m) of the Code
for deductibility.

 

8.4              
Adjustment of Performance-Based Compensation. The terms of Awards that are designed to qualify as Performance-Based
Compensation, and that are held by Covered Employees, may not be modified, except to the extent that after such modification the
Award would continue to constitute Performance-Based Compensation. The Committee shall retain the discretion to reduce the amount
of any payment under an Award that is designed to qualify as Performance-Based Compensation that would otherwise be payable to
a Covered Employee, either on a formula or discretionary basis or any combination, as the Committee determines.

 

8.5              
Committee Discretion. In the event that applicable tax and/or securities laws change to permit Committee discretion
to alter the governing Performance Measures without obtaining stockholder approval of such changes, the Committee shall have sole
discretion to make such changes without obtaining stockholder approval. In addition, in the event that the Committee determines
that it is advisable to grant Awards that shall not qualify as Performance-Based Compensation, the Committee may make such grants
without satisfying the requirements of Section 162(m) of the Code and may base vesting on Performance Measures other than those
set forth in Section 8.2.

 

    	 	10	 

     

    

 

ARTICLE 9

Beneficiary Designation

 

Each Participant 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 Participant, shall be in a form prescribed by the Committee, and will be effective only
when filed by the Participant in writing with the Company during the Participant’s lifetime. In the absence of any such designation,
benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate.

 

ARTICLE 10

Deferrals

 

To the extent permitted by the Section 409A
Rules and Section 162(m) of the Code, the Committee may permit or require a Participant to defer the delivery of Shares that would
otherwise be due to such Participant by virtue of the lapse or waiver of restrictions with respect to Restricted Stock Units. If
any such deferral election is required or permitted, the Committee shall, in its sole discretion, establish rules and procedures
for such payment deferrals, consistent with the Section 409A Rules.

 

It is intended that all Awards issued under
the Plan be in a form and administered in a manner that will comply with the requirements of Section 409A of the Code, or the requirements
of an exception to Section 409A of the Code, and the Evidence of Award and this Plan will be construed and administered in a manner
that is consistent with and gives effect to such intent. The Committee is authorized to adopt rules or regulations deemed necessary
or appropriate to qualify for an exception from or to comply with the requirements of Section 409A of the Code. With respect to
an Award that constitutes a deferral of compensation subject to Code Section 409A: (i) if any amount is payable under such Award
upon a termination of service, a termination of service will be treated as having occurred only at such time the Participant has
experienced a “separation from service” as such term is defined for purposes of Code Section 409A; (ii) if any amount
is payable under such Award upon a Disability, a Disability will be treated as having occurred only at such time the Participant
has experienced a “disability” as such term is defined for purposes of Code Section 409A; (iii) if any amount is payable
under such Award on account of the occurrence of a Change in Control, a Change in Control will be treated as having occurred only
at such time a “change in the ownership or effective control of the corporation or in the ownership of a substantial portion
of the assets of the corporation” has occurred as such terms are defined for purposes of Code Section 409A, (iv) if any amount
becomes payable under such Award on account of a Participant’s separation from service at such time as the Participant is
a “specified employee” within the meaning of Code Section 409A, then no payment shall be made, except as permitted
under Code Section 409A, prior to the first business day after the earlier of (y) the date that is six months after the date of
the Participant’s separation from service or (z) the Participant’s death, and (v) no amendment to or payment under
such Award will be made except and only to the extent permitted under Code Section 409A.

 

Notwithstanding the foregoing, the tax treatment
of the benefits provided under the Plan or any Evidence of Award is not warranted or guaranteed, and in no event shall the Company
be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by the Participant on
account of non-compliance with Section 409A of the Code.

 

    	 	11	 

     

    

 

ARTICLE 11

Rights of Participants

 

11.1          
Employment. Nothing in the Plan or an Evidence of Award shall interfere with or limit in any way the right of the
Company, its Affiliates, and/or its Subsidiaries to terminate any Participant’s employment or service on the Board at any
time or for any reason not prohibited by law, nor confer upon any Participant any right to continue his or her employment or service
for any specified period of time.

 

Neither an Award nor any benefits arising
under the Plan shall constitute an employment contract with the Company, its Affiliates, and/or its Subsidiaries and, accordingly,
subject to Articles 3 and 13, the Plan and the benefits hereunder may be terminated at any time in the sole and exclusive discretion
of the Committee without giving rise to any liability on the part of the Company, its Affiliates, and/or its Subsidiaries.

 

11.2          
Participation. No individual 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          
Rights as a Stockholder. Except as otherwise provided herein, a Participant shall have none of the rights of a stockholder
with respect to Shares covered by any Award until the Participant becomes the record holder of such Shares.

 

ARTICLE 12

Change in Control

 

12.1          
Change in Control. For purposes of the Plan, a “Change in Control” shall mean the occurrence during the
term of any of the following events:

 

(a)               
In connection with a sale or series of sales of securities of the Company, one Person (including an entity) or more than
one Person acting as a group (other than Ancora Advisors, LLC and its Affiliates) acquires securities of the Company that results
in Beneficial Ownership of more than 50% of the outstanding securities entitled to vote generally in the election of directors
of the Company;

 

(b)               
All or substantially all (meaning having a total gross fair market value equal to more than 50% of the total gross fair
market value of all of the Company’s assets immediately before such acquisition or acquisitions) of the assets of the Company
are acquired by one Person (including an entity) or more than one Person acting as a group (during a 12-month period ending on
the date of the most recent acquisition by such Person or Persons); or

 

(c)               
The Company is merged, consolidated, or reorganized into or with another corporation or entity during a 12-month period
with the result that upon the conclusion of the transaction less than 50% of the outstanding securities entitled to vote generally
in the election of directors or other capital interests of the surviving, resulting or acquiring corporation are Beneficially Owned,
directly or indirectly, by the stockholders of the Company immediately prior to the completion of the transaction.

 

Notwithstanding the foregoing, a Change in
Control will not be deemed to have occurred (i) as a result of the issuance of stock by the Company in connection with any public
offering of its stock or (ii) due to Beneficial Ownership of securities of the Company by Ancora Advisors, LLC and its Affiliates.

 

    	 	12	 

     

    

 

12.2          
Acceleration of Vesting and Exercisability. Upon the occurrence of a Change in Control, the Committee may accelerate
the vesting and exercisability (as applicable) of any outstanding Awards, in whole or in part, as determined by the Committee in
its sole discretion. For any Award that vests or becomes exercisable upon the achievement of Performance Measures, the Committee
will determine, in its sole discretion, the extent to which such Performance Measures have been achieved. In its sole discretion,
the Committee may also determine that, upon the occurrence of a Change in Control, each outstanding Option shall terminate within
a specified number of days after notice to the Participant, and each such Participant shall receive, with respect to each Share
subject to such Option, an amount equal to the excess of the Fair Market Value of such Share immediately prior to such Change in
Control over the applicable Option Price, which amount shall be payable in cash, in one or more kinds of property (including the
property, if any, payable in the transaction) or a combination thereof, as the Committee shall determine in its sole discretion.
If the Fair Market Value of the Shares subject to an Option does not exceed the Option Price(s) for such Shares (i.e.,
the Option is “underwater”), the Committee may cancel such Option without any payment or consideration to the Participant.

 

ARTICLE 13

Amendment, Modification, Suspension, and Termination

 

13.1          
Amendment, Modification, Suspension, and Termination. Subject to Sections 13.3 and 13.4, the Committee may, at any
time and from time to time, alter, amend, modify, suspend, or terminate the Plan and any Evidence of Award in whole or in part;
provided, however, that, without the prior approval of the Company’s stockholders and except as provided in
Section 4.4, Options issued under the Plan will not be repriced, replaced with any Award, cancelled in exchange for cash, or regranted
through cancellation, or by lowering the Option Price of a previously granted Option, and no amendment of the Plan or Award hereunder
shall be made without stockholder approval if stockholder approval is required by law, regulation, or stock exchange rule.

 

13.2          
Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events. The Committee may make adjustments,
consistent with Section 162(m) of the Code and the Section 409A Rules, in the terms and conditions of, and the criteria included
in, Awards in recognition of unusual or nonrecurring events (including, without limitation, the events described in Section 4.4
hereof and future issuances of securities by the Company) 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 unintended dilution or enlargement of the benefits or potential benefits intended to be made available
under the Plan. The determination of the Committee as to the foregoing adjustments, if any, shall be conclusive and binding on
Participants under the Plan.

 

13.3          
Awards Previously Granted. Notwithstanding any other provision of the Plan to the contrary (other than Section 13.4),
no termination, amendment, suspension, or modification of the Plan or an Evidence of Award shall adversely affect in any material
way any Award previously granted under the Plan, without the written consent of the Participant holding such Award.

 

13.4          
Amendment to Conform to Law. Notwithstanding any other provision of the Plan to the contrary, the Board may amend
the Plan or an Evidence of Award, to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of
conforming the Plan or an Evidence of Award to any present or future law relating to plans of this or similar nature (including,
without limitation, the Section 409A Rules and Section 162(m) of the Code), and to the administrative regulations and rulings promulgated
thereunder.

 

    	 	13	 

     

    

 

ARTICLE 14

Withholding

 

14.1          
Tax Withholding. As determined by the Company in good faith, the Company shall have the power and the right to deduct
or withhold, or require a Participant to remit to the Company, any foreign, federal, state, or local tax required by law to be
withheld with respect to any taxable event arising as a result of the Plan.

 

14.2          
Share Withholding. With respect to withholding required upon the exercise of Options, upon the lapse of restrictions
on Restricted Stock or Restricted Stock Units, or any other taxable event arising as a result of an Award granted hereunder, Participants
may elect, subject to the approval of the Committee, to satisfy the withholding requirement, in whole or in part, by having the
Company withhold Shares having a Fair Market Value on the date the tax is to be determined to not exceed the amount of any foreign,
federal, state, or local tax required by law to be withheld on the transaction as determined by the Company in good faith. All
such elections shall be irrevocable, made in writing, and signed by the Participant, and shall be subject to any restrictions or
limitations that the Committee, in its sole discretion, deems appropriate.

 

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

General Provisions

 

16.1          
Forfeiture Events. The Committee may specify in an Evidence of Award that the Participant’s rights, payments,
and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture, or recoupment upon the occurrence
of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events
may include, but shall not be limited to, termination of employment for cause, termination of the Participant’s provision
of services to the Company, its Affiliate, and/or its Subsidiary, violation of material Company, Affiliate, and/or Subsidiary policies,
breach of noncompetition, confidentiality, or other restrictive covenants that may apply to the Participant, or other conduct by
the Participant that is detrimental to the business or reputation of the Company, its Affiliates, and/or its Subsidiaries.

 

16.2          
Legend. The certificates for Shares may include any legend that the Committee deems appropriate in its sole discretion
to reflect any restrictions on transfer of such Shares.

 

16.3          
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.

 

    	 	14	 

     

    

 

16.4          
Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality
or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal
or invalid provision had not been included. To the extent that any provision of the Plan would prevent any Option that was intended
to qualify as an Incentive Stock Option from qualifying as such, that provision shall be null and void with respect to such Option.
Such provision, however, shall remain in effect for other Options and there shall be no further effect on any provision of the
Plan.

 

16.5          
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 national securities exchanges as may be required.

 

16.6          
Delivery of Title. The Company shall have no obligation to issue or deliver evidence of title for Shares issued under
the Plan prior to:

 

(a)               
Obtaining any approvals from governmental agencies that the Company determines are necessary or advisable; and

 

(b)               
Completion of any registration or other qualification of the Shares under any applicable national or foreign law or ruling
of any governmental body that the Company determines to be necessary or advisable.

 

16.7          
Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction,
which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

 

16.8          
Investment Representations. The Committee may require any Person receiving Shares pursuant to an Award under the
Plan to represent and warrant in writing that the Person is acquiring the securities for his or its own account for investment
and not with a view to, or for sale in connection with, the distribution of any part thereof.

 

16.9          
Uncertificated Shares. To the extent that the Plan provides for issuance of certificates to reflect the transfer
of Shares, the transfer of such Shares may be effected on a noncertificated basis, to the extent not prohibited by applicable law
or the rules of any stock exchange.

 

16.10       
Unfunded Plan. Participants shall have no right, title, or interest whatsoever in or to any investments that the
Company, its Subsidiaries, and/or its Affiliates may make to aid it in meeting its obligations under the Plan. Nothing contained
in the Plan, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind, or a fiduciary
relationship between the Company and any Participant, beneficiary, legal representative, or any other Person. To the extent that
any Person acquires a right to receive payments from the Company, its Subsidiaries, and/or its Affiliates under the Plan, such
right shall be no greater than the right of an unsecured general creditor of the Company, a Subsidiary, or an Affiliate, as the
case may be. The Plan is not subject to ERISA.

 

16.11       
No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award. The Committee
shall determine whether cash, Awards, or other property shall be issued or paid in lieu of fractional Shares or whether such fractional
Shares or any rights thereto shall be forfeited or otherwise eliminated.

 

16.12       
Retirement and Welfare Plans. Neither Awards made under the Plan nor Shares delivered or cash paid pursuant to such
Awards will be included as “compensation” for purposes of computing the benefits payable to any Participant under the
Company’s or any of its Subsidiaries’ or Affiliates’ retirement plans (both qualified and non-qualified) or welfare
benefit plans unless such other plan expressly provides that such compensation shall be taken into account in computing a Participant’s
benefit.

 

    	 	15	 

     

    

 

16.13       
Nonexclusivity of the Plan. The adoption of the Plan shall not be construed as creating any limitations on the power
of the Board or Committee to adopt such other compensation arrangements as it may deem desirable for any Participant.

 

16.14       
No Constraint on Corporate Action. Nothing in the Plan shall be construed to: (i) limit, impair, or otherwise affect
the Company’s or any of its Subsidiaries’ or Affiliates’ right or power to make adjustments, reclassifications,
reorganizations, or changes of its capital or business structure, or to merge or consolidate, or dissolve, liquidate, sell, or
transfer all or any part of its business or assets; or (ii) limit the right or power of the Company or any of its Subsidiaries
or Affiliates to take any action which such entity deems to be necessary or appropriate.

 

16.15       
Governing Law. The Plan and each Evidence of Award shall be governed by the laws of the State of Delaware, excluding
any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive
law of another jurisdiction. Unless otherwise provided in the Evidence of Award, recipients of an Award under the Plan are deemed
to submit to the exclusive jurisdiction and venue of the federal or state courts of Delaware, to resolve any and all issues that
may arise out of or relate to the Plan or any related Evidence of Award.

 

 

    	 	16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00272-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00272-of-00352.parquet"}]]