Document:

Exhibit

Exhibit 10.1

February 22, 2018

Jean Compeau
c/o Palo Alto Networks, Inc.
3000 Tannery Way
Santa Clara, CA 95054

		
	Re:
	Terms of Employment

Dear Jean:
This letter agreement (the “Agreement”) is entered into between Palo Alto Networks, Inc. (“Company” or “we”) and Jean Compeau (“Executive” or “you”).  This Agreement is effective as of February 22, 2018 (“Effective Date”).  The purpose of this Agreement is to confirm the current and updated terms and conditions of your employment and to specify your treatment upon certain termination of employment.
1.Position.  Beginning on the Effective Date, you will serve as Chief Accounting Officer of the Company.  You will report to the Chief Financial Officer and shall perform the duties and responsibilities customary for such position and such other related duties as are assigned by the Chief Financial Officer.  This is a full-time position.  While you render services to the Company, you will not engage in any other employment, consulting or other business activity (whether full-time or part-time) that would create a conflict of interest with the Company.  You may engage in civic and not-for-profit activities as long as such activities do not interfere with the performance of your duties hereunder.  By signing this Agreement, you confirm to the Company that you have no contractual commitments or other legal obligations that would prohibit you from performing your duties for the Company.
2.Cash Compensation.
(a)    Base Salary.  Your salary will be at an annualized rate of $335,000 per year beginning on the Effective Date, payable in accordance with the Company’s standard payroll schedule.  Your salary, as well as any other cash amounts payable under this Agreement, will be subject to applicable tax withholdings.  Your salary may be adjusted from time to time by our Board of Directors (the “Board”) or the Compensation Committee of our Board of Directors (the “Compensation Committee”) in their sole discretion.

Jean Compeau
February 22, 2018
Page 2

(b)    Annual Incentive Compensation Payment.  You will have the opportunity to earn a target annual incentive compensation payment of 50% of your annual base salary for each fiscal year based on the achievement of certain objectives, which will be established by our Board and/or the Compensation Committee.  Each incentive compensation payment is subject to your continued employment through and until the date of payment.  The incentive compensation will be paid no later than March 15 of the year following the year in which such incentive compensation was earned.  Your target annual incentive compensation opportunity and the terms and conditions thereof may be adjusted from time to time by our Board or the Compensation Committee in their sole discretion.
3.Equity.  The Company will grant you an equity award pursuant to the terms of the Company’s 2012 Equity Incentive Plan (the “Plan”) with an approximate value of $250,000, in the form of restricted stock units (“RSUs”).  One-sixteenth (1/16th) of the RSUs will vest on May 20, 2018, and one-sixteenth (1/16) of the RSUs will vest quarterly thereafter, subject to you continuing to be a Service Provider (as defined in the Plan) through each vesting date.  
4.At Will Employment.  While we look forward to a continued productive relationship, your employment with the Company, however, is for an unspecified period of time and this Agreement creates an at-will employment relationship that may be terminated (subject to the terms of this Agreement) by you or the Company at any time for any reason and with or without cause or prior notice.  Upon termination of your employment for any reason, you shall be entitled to receive any compensation earned and reimbursements due through the effective date of termination.
5.Termination Benefits.
(a)    Following a Change in Control.  In the event that there is a Change in Control of the Company and the Company or its successor terminates your employment other than for Cause, or you terminate your employment for Good Reason, in either case upon or within twelve (12) months following the Change in Control, then you will be entitled to receive: (i) a lump-sum payment equal to your then-current annual base salary, 100% of your target bonus for that fiscal year, and reimbursement of twelve (12) months of your COBRA premiums in a lump sum; and (ii) acceleration of the vesting of the greater of (A) twelve (12) months vesting of your then-outstanding unvested time-based equity awards, or (B) fifty percent (50%) of your then-outstanding unvested time-based equity awards (for the avoidance of doubt, the greater of under this sub-section (ii) will be determined on an award by award basis) (collectively, the “Change in Control Severance Benefits”).  Your entitlement to the Change in Control Severance Benefits is subject to your compliance with subsection (b) below.

Jean Compeau
February 22, 2018
Page 3

(b)    Form and Timing of Payment.  This Section 5 will not apply unless you (i) have returned all Company property in your possession and (ii) have executed a general release of all claims that you may have against the Company or persons affiliated with the Company.  The release must be in the form prescribed by the Company.  You must execute and return the release on or before the date specified by the Company in the prescribed form (the “Release Deadline”).  The Release Deadline will in no event be later than 50 days after your separation.  If you fail to return the release on or before the Release Deadline, or if you revoke the release, then you will not be entitled to the benefits described in this Section 5.  The severance payments will be paid in lump sum following the effectiveness of the release within 60 days after your separation.  Notwithstanding the foregoing, if the 60-day period described in the preceding sentence spans two calendar years and/or if your severance payments are Deferred Payments (as defined below), then the payments will be paid in lump sum on the 60th day following your termination of employment, subject to Section 7.
(c)    Definitions.
(i)For purposes of this Agreement, “Cause” shall mean: (i) conviction of any felony or any crime involving moral turpitude or dishonesty; (ii) participation in intentional fraud or an act of willful dishonesty against the Company; (iii) willful breach of the Company’s policies which materially harms the Company; (iv) intentional damage of a substantial amount of the Company’s property; (v) willful and material breach of this agreement or Employee Invention Assignment and Confidentiality Agreement; or (vi) a willful failure or refusal in a material respect by you to follow the lawful, reasonable policies or directions of the Company as specified by the Board or the Chief Executive Officer after being provided with notice of such failure, such notice specifying in reasonable detail the tasks which must be accomplished and a timeline for the accomplishment to avoid termination for Cause, and an opportunity to cure within thirty (30) days of receipt of such notice.
(ii)For purposes of this Agreement, “Good Reason” shall mean: (i) a material reduction in your authority, status, obligations or responsibilities, provided that following a Change in Control a change in title alone (not accompanied by a change in authority, status, obligations or responsibilities) shall not constitute a material reduction; (ii) a reduction of your total annual compensation of more than 10% unless such reduction is no greater (in percentage terms) than compensation reductions imposed on substantially all of the Company’s employees pursuant to a directive of the Board; (iii) any failure by the Company to pay your base salary; or (iv) the relocation of the principal place of the Company’s business to a location that is more than thirty-five (35) miles further from your home than before the relocation.  Your resignation must occur within 12 months after one of the foregoing conditions has come into existence without your consent.  A resignation for Good Reason will not be deemed to have occurred 

Jean Compeau
February 22, 2018
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unless you give the Company written notice of the condition within 90 days after the condition comes into existence and the Company fails to remedy the condition within 30 days after receiving your written notice.
(iii)For purposes of this Agreement, “Change in Control” shall mean: (i) the sale or other disposition of all or substantially all of the assets of the Company; (ii) any sale or exchange of the capital stock of the Company by the stockholders of the Company in one transaction or series of related transactions where more than fifty percent (50%) of the outstanding voting power of the Company is acquired by a person or entity or group of related persons or entities; (iii) any reorganization, consolidation or merger of the Company where the outstanding voting securities of the Company immediately before the transaction represent or are converted into less than fifty percent (50%) of the outstanding voting power of the surviving entity (or its parent corporation) immediately after the transaction; or (iv) the consummation of the acquisition of fifty-one percent (51%) or more of the outstanding stock of the Company pursuant to a tender offer validly made under any federal or state law (other than a tender offer by the Company).  Notwithstanding the foregoing, a transaction will not be deemed a Change in Control unless the transaction qualifies as a change in control event within the meaning of Section 409A.
6.Section 280G.  If any payments and other benefits provided for in this Agreement or otherwise constitute “parachute payments” within the meaning of Section 280G of the Code and, but for this Section 6, would be subject to the excise tax imposed by Section 4999 of the Code, then payments and other benefits will be payable to you either in full or in such lesser amounts as would result, after taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, on your receipt on an after-tax basis of the greatest amount of payments and other benefits, by reducing payments in the following order: (i) cancellation of accelerated vesting of stock options that are out-of-the-money; (ii) reduction in cash payments; (iii) cancellation of accelerated vesting of all equity awards that are not out-of-the-money stock options; and (iv) other employee benefits.  In the event that acceleration of vesting of equity award compensation is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant.
7.Section 409A.  For purposes of this Agreement, a termination of employment will be determined consistent with the rules relating to a “separation from service” as defined in Section 409A of the Code and the regulations thereunder (“Section 409A”).  Notwithstanding anything else provided herein, to the extent any payments provided under this Agreement in connection with your termination of employment constitute deferred compensation subject to Section 409A (“Deferred Payments”), and you are deemed at the time of such termination of employment to be a “specified employee” under Section 409A, then such payment shall not be 

Jean Compeau
February 22, 2018
Page 5

made or commence until the earlier of (i) the expiration of the six (6)-month period measured from your separation from service from the Company or (ii) the date of your death following such a separation from service; provided, however, that such deferral shall only be effected to the extent required to avoid adverse tax treatment to you including, without limitation, the additional tax for which you would otherwise be liable under Section 409A(a)(1)(B) in the absence of such a deferral.  The first payment thereof will include a catch-up payment covering the amount that would have otherwise been paid during the period between your termination of employment and the first payment date but for the application of this provision, and the balance of the installments (if any) will be payable in accordance with their original schedule.  To the extent that any provision of this Agreement is ambiguous as to its compliance with Section 409A, the provision will be read in such a manner so that all payments hereunder comply with Section 409A.  To the extent any payment under this Agreement may be classified as a “short-term deferral” within the meaning of Section 409A, such payment shall be deemed a short-term deferral, even if it may also qualify for an exemption from Section 409A under another provision of Section 409A.  Payments pursuant to this Agreement are intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.
8.Benefits.  You will continue to be eligible to participate in benefit plans established by the Company for its employees from time to time.  Upon your termination of employment with the Company for any reason, you will be paid your salary through your date of termination.
9.Confidentiality; Compliance with Policies.  As an employee of the Company, you will have access to certain confidential information of the Company and you may, during the course of your employment, develop certain information or inventions that will be the property of the Company.  To protect the interests of the Company, as a condition of your employment you were required to sign the Company’s “Employee Invention Assignment and Confidentiality Agreement” on or prior to your start date.  You represent that your signing of this Agreement and the Company’s Employee Invention Assignment and Confidentiality Agreement, and your continued employment with the Company, will not violate any agreement currently in place between yourself and current or past employers.  You agree to continue to be bound by the policies and procedures of the Company now or hereafter in effect relating to the conduct of employees.
10.Authorization to Work.  Please note that because of employer regulations adopted in the Immigration Reform and Control Act of 1986, within three (3) business days of commencing employment with the Company you were required to present documentation demonstrating that you have authorization to work in the United States.  By your signature to this Agreement, you represent that you have presented the Company such documentation.

Jean Compeau
February 22, 2018
Page 6

11.Governing Law; Arbitration.  This Agreement shall be construed and enforced in accordance with the internal laws of the State of California (without regard to its laws relating to choice-of-law or conflict-of-laws).  You and the Company shall submit to mandatory and exclusive binding confidential arbitration of any controversy or claim arising out of, or relating to, this Agreement or any breach hereof or otherwise arising out of, or relating to, your employment with the Company or the termination thereof, provided, however, that the parties retain their right to, and shall not be prohibited, limited or in any other way restricted from, seeking or obtaining injunctive relief from a court having jurisdiction over the parties related to the improper use, disclosure or misappropriation of a party’s proprietary, confidential or trade secret information.  Such arbitration shall be conducted through JAMS in the State of California, Santa Clara County, before a single neutral arbitrator, in accordance with the JAMS’ then-current rules for the resolution of employment disputes.  The arbitrator shall issue a written decision that contains the essential findings and conclusions on which the decision is based.  You shall bear only those costs of arbitration you would otherwise bear had you brought a covered claim in court.  Judgment upon the determination or award rendered by the arbitrator may be entered in any court having jurisdiction thereof.  This agreement to arbitrate does not restrict your right to file administrative claims you may bring before any government agency where, as a matter of law, the parties may not restrict the employee’s ability to file such claims (including, but not limited to, the National Labor Relations Board, the Equal Employment Opportunity Commission and the Department of Labor).  However, the parties agree that, to the fullest extent permitted by law, arbitration shall be the exclusive remedy for the subject matter of such administrative claims.
12.Miscellaneous.
(a)    Successors.  This Agreement shall inure to the benefit of and be binding upon (a) the Company and any of its successors, and (b) you and your heirs, executors and representatives in the event of your death.  Any successor to the Company shall be deemed substituted for the Company under the terms of this agreement for all purposes.  In the event of a Change in Control, the Company agrees to obtain assumption of this Agreement by its successor.
(b)    Modification.  This Agreement, including, but not limited to the at will provision above, may not be amended or modified other than by a written agreement designated as an amendment and executed by you and a representative of the Board, although the Company reserves the right to unilaterally modify your compensation, benefits, job title and duties (subject to any express limitations set forth above).
(c)    Severability.  If any provision of this Agreement or the application thereof is held invalid, the invalidity shall not affect other provisions or applications of this Agreement that can 

Jean Compeau
February 22, 2018
Page 7

be given effect without the invalid provisions or applications and to this end the provisions of this Agreement are declared to be severable.
(d)    Complete Agreement.  This Agreement (together with the Employee Invention Assignment and Confidentiality Agreement, the D&O Indemnification Agreement (if any) and the Company’s 2012 Equity Incentive Plan, any successor equity incentive plan and any equity award agreement issued thereunder) represents the entire agreement between you and the Company with respect to the material terms and conditions of your employment, and supersedes and replaces all prior discussions, negotiations and agreements, including, but not limited to your original offer letter agreement with the Company dated November 12, 2012.
(e)    Counterparts.  This Agreement may be executed (i) in counterparts, each of which shall be an original, with same effect as if the signatures hereto were on the same instrument; and (ii) by facsimile or pdf.  The parties agree that such facsimile or pdf signatures shall be deemed original signatures for all purposes.

[remainder of page left black]

[signature page to follow]

Jean Compeau
February 22, 2018
Page 8

We are extremely excited about your continued employment with Palo Alto Networks.
Please indicate your acceptance of this Agreement, and confirmation that it contains our complete agreement regarding the terms and conditions of your employment, by signing the bottom portion of this letter and returning a copy to me.  

For and on behalf of Palo Alto Networks.
	
		
	/s/ MARK MCLAUGHLIN

	Mark McLaughlin, Chief Executive Officer

Agreed to and accepted:
	
		
	/s/ JEAN COMPEAU

	Jean Compeau

	Dated:
	February 23, 2018EX-10.1

 Exhibit 10.1 

ALARM.COM HOLDINGS, INC. 

2018 EXECUTIVE BONUS PLAN 

1.    Purpose. As part of its executive compensation program, Alarm.com Holdings, Inc. (the
“Company”) has designed this 2018 Executive Bonus Plan (the “Bonus Plan”) for the 2018 calendar year. The Bonus Plan operates under, and is part of, the Alarm.com Holdings, Inc. 2015 Equity Incentive
Plan (the “2015 Plan”), which has been approved by the Board and the Company’s stockholders. The Bonus Plan provides Participants with incentive awards, paid in cash and/or shares of Common Stock, based on the
achievement of objectively determinable performance goals. The Bonus Plan is intended to permit the payment of bonuses that may qualify as Performance-Based Compensation. 

2.    Definitions. Defined terms not explicitly defined in the Bonus Plan but defined in the 2015 Plan shall
have the same definitions as in the 2015 Plan. 
 (a)    “Bonus Award” means, with
respect to each Participant, the award determined pursuant to Section 5(f) below, which is subject to the Committee’s authority under Section 5(f). 

(b)    “Code” means the Internal Revenue Code of 1986, as amended. 

(c)    “Committee” means the Compensation Committee of the Board (or a subcommittee
thereof), or such other committee of the Board (including, without limitation, the full Board) to which the Board has delegated power to act under or pursuant to the provisions of the 2015 Plan; provided, however, that with respect to
payments under the Bonus Plan intended to qualify as Performance-Based Compensation, the Committee shall consist, to the extent required by Section 162(m), solely of two or more members of the Board who qualify as “outside directors”
within the meaning of Section 162(m). 
 (d)    “Maximum Bonus Award” means, as to
any Participant for the Performance Period, the maximum award that may be granted to the Participant under the Bonus Plan. In no event may the Maximum Bonus Award paid in respect of a calendar year exceed the amount specified in Section 3(d) of
the 2015 Plan. 
 (e)    “Participant” means an eligible officer selected by the
Committee, in its sole discretion, to participate in the Bonus Plan. 
 (f)    “Payout Determination
Date” means the date upon which the Committee determines the amounts payable pursuant to the Target Bonus Award with respect to the completed Performance Period, in accordance with Section 5(f). 

(g)    “Payout Formula” means, as to any Performance Period, the formula or payout matrix
established by the Committee pursuant to Section 5 in order to determine the Bonus Awards (if any) to be paid to each Participant. The Payout Formula may be (but is not required to be) expressed as a percentage (which may be more than 100%) of
the Target Bonus Award. The Payout Formula may differ from Participant to Participant and, with respect to any one Participant in a given Performance Period. 

 (h)    “Performance-Based Compensation” means
compensation that is intended to qualify as “performance-based compensation” within the meaning of Section 162(m). 

(i)    “Performance Goals” means the goal(s) (or combined goal(s)) determined by the
Committee, in its sole discretion, to be applicable to a Participant with respect to a Bonus Award including, as set forth in Sections 13(nn) and 13(oo) of the 2015 Plan. The criteria set forth in Sections 13(nn) or 13(oo) of the 2015 Plan may
relate to the Company, one or more of its Affiliates or one or more of its or their divisions or units, or any combination of the foregoing, and may be applied on an absolute basis and/or be relative to one or more peer group companies or indices,
or any combination thereof, all as the Committee shall determine. 
 (j)    “Performance
Period” means the 2018 calendar year. 

(k)    “Section 162(m)” means Section 162(m) of
the Code, or any successor to Section 162(m), as such Section may be interpreted from time to time by the Internal Revenue Service, whether by regulation, notice or otherwise. 

(l)    “Target Bonus Award” means the target award payable under the Bonus Plan to a
Participant for the Performance Period, as determined by the Committee in accordance with Section 5(c). 

(m)    “Target Determination Cutoff Date” means the latest possible date that will not
jeopardize a Target Bonus Award’s qualification as Performance-Based Compensation. 

(n)    “Target Determination Date” means the date or dates upon which the Committee sets
the Performance Goals and each Participant’s Target Bonus Award with respect to the Performance Period, in accordance with Sections 5(b) and 5(c). 

3.    Plan Administration. 

(a)    The Committee shall be responsible for the general administration and interpretation of the Bonus Plan and
for carrying out its provisions. Subject to the requirements for qualifying compensation as Performance-Based Compensation, the Committee may delegate specific administrative tasks to Company employees or others as appropriate for proper
administration of the Bonus Plan. Subject to the limitations on Committee discretion imposed under Section 162(m), the Committee shall have such powers as may be necessary to discharge its duties hereunder, including, but not by way of
limitation, the following powers and duties, but subject to the terms of the Bonus Plan: 
 (i)    authority to
adopt Performance Goals and Target Bonus Awards under the Bonus Plan for the Performance Period on or prior to the Target Determination Cutoff Date, to the extent applicable; 

(ii)    authority to determine eligibility and the amount, form, manner and time of payment of any Bonus Awards
hereunder, including authority to exercise negative discretion in reducing any Maximum Bonus Award; 

(iii)    authority to construe and interpret the terms of the Bonus Plan; 

  
 2 

 (iv)    authority to prescribe forms and procedures for purposes of
Bonus Plan participation and distribution of Bonus Awards; and 
 (v)    authority to adopt rules, regulations
and bylaws and to take such actions as it deems necessary or desirable for the proper administration of the Bonus Plan. 

(b)    Any rule or decision by the Committee that is not inconsistent with the provisions of the Bonus Plan or
the 2015 Plan shall be conclusive and binding on all persons, and shall be given the maximum deference permitted by law. 

4.    Eligibility. Participation in the Bonus Plan is at the discretion of the Committee. Officers of the
Company who are regularly employed (full or part time) during the Performance Period and who are subject to Section 16 of the Securities Exchange Act of 1934, are eligible to participate in the Bonus Plan. If an officer is hired after the
beginning of the Performance Period, the Committee shall have the discretion to determine whether such officer should be eligible to participate in the Bonus Plan. If the Participant’s Bonus Plan target percent changes during the Performance
Period, the officer’s Target Bonus Award will be pro-rated based on those adjusted figures as follows: the Target Bonus Award will be based on the number of days in the Performance Period with
the former Bonus Plan annual bonus target percent and the number of days in the Performance Period with the new Bonus Plan annual target percent. A Participant must be employed through the payment date to earn any award under this Bonus Plan; if the
Participant’s employment terminates before the payment date of any Bonus Award, the Participant will not be eligible to receive a Bonus Award, or any portion of a Bonus Award, except as provided in an applicable severance plan or in an
individual employment or retention agreement with such Participant. If a Participant is on a leave of absence for a portion of the Performance Period, the Participant will be eligible for a Bonus Award under the Bonus Plan based on actual salary
earned during the Performance Period (exclusive of any salary replacement benefits paid during the leave via insurance). 

5.    Bonus Awards. 

(a)    Bonus Plan Components. The Bonus Plan components are: (i) the Performance
Goals; (ii) the Target Bonus Award; (iii) the Maximum Bonus Award; and (iv) the Bonus Award. 

(b)    Performance Goal Determination. On the Target Determination Date, the Committee, in its sole
discretion, shall establish the Performance Goals for each Participant for the Performance Period. Such Performance Goals shall be set forth in writing on or prior to the applicable Target Determination Cutoff Date, and the achievement of such
Performance Goals shall be substantially uncertain at such time. 
 (c)    Target Bonus Award. On the
Target Determination Date, the Committee, in its sole discretion, shall designate a Target Bonus Award for each Participant. Each Participant’s Target Bonus Award shall be set forth in writing on or prior to the Target Determination Cutoff
Date. The Participant’s Bonus Award is calculated, in part (as further described below), by reference to his or her Target Bonus Award. 

  
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 (d)    Maximum Bonus Award. Subject to Section 2(e)
above, the Maximum Bonus Award that may be earned by a Participant is 150 percent of the Participant’s Target Bonus Award. 

(e)    Payout Formula. On the Target Determination Date, the Committee, in its sole discretion, shall
establish the Payout Formula for purposes of determining the Bonus Award that may be earned by each Participant. Each Payout Formula (a) shall be set forth in writing on or prior to the Target Determination Cutoff Date, (b) shall provide
for the payment of a Participant’s Bonus Award if the Performance Goals for the Performance Period are achieved, and (c) may provide for a Bonus Award payment greater than or less than the Participant’s Target Bonus Award (i.e., a
Maximum Bonus Award and a threshold award), depending upon the extent to which the Performance Goals are achieved. Notwithstanding the preceding, in no event shall a Participant’s Bonus Award for any Performance Period exceed the Maximum Bonus
Award. 
 (f)    Determination of the Bonus Award. On the Payout Determination Date,
the Committee shall determine and certify in writing (which may be by approval of the minutes in which the certification was made) the extent to which the Performance Goals applicable to each Participant for the Performance Period were achieved or
exceeded. The Bonus Award for each Participant shall be determined by applying the Payout Formula to the level of actual performance that has been certified by the Committee. Notwithstanding any contrary provision of the Bonus Plan, the Committee,
in its sole discretion, may eliminate or reduce the Bonus Award payable to any Participant below that which otherwise would be payable under the Payout Formula in its discretion. 

6.    Bonus Award Payment. 

(a)    Right to Receive Payment. Each Bonus Award under the Bonus Plan shall be paid solely from
the general assets of the Company. Nothing in the Bonus Plan shall be construed to create a trust or to establish or evidence any Participant’s claim of any right to payment of a Bonus Award other than as an unsecured general creditor with
respect to any payment to which he or she may be entitled. 
 (b)    Form of Payment of
Bonus Awards. Except as otherwise determined by the Committee, subject to Section 4, the Company shall distribute a Participant’s Bonus Award to the Participant in the form of cash and/or shares of Common Stock, as
determined by the Committee, in its sole discretion, on the Payout Determination Date. Subject to Section 6(d), a Participant’s Bonus Award shall be paid to the Participant as soon as is practicable following the Payout Determination Date
for the Performance Period, but in no event later than the 15th day of the third calendar month after the end of the calendar year in which the Participant’s Bonus Award is no longer subject to a substantial risk of forfeiture, within the
meaning of Treasury Regulation Section 1.409A-1(d). Payments under this Bonus Plan shall be made in a manner that complies with Treasury Regulation
Section 1.409A-1(b)(4) and this Bonus Plan shall be construed in accordance with such provision. 

(c)    Tax Withholding. The Company will withhold from any payments under the Bonus Plan and
from any other amounts payable to a Participant by the Company any amount required 

  
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to satisfy the income and employment tax withholding obligations arising under applicable federal and state laws in respect of a Bonus Award. Without limiting the forgoing, with respect to any
portion of a Bonus Award paid in shares of Common Stock, the Company may, in its sole discretion, satisfy all or any portion of its tax withholding obligations by (i) causing a Participant to tender a cash payment, (ii) permitting a
Participant to enter into a “same day sale” commitment, if applicable, with a broker-dealer whereby the Participant irrevocably elects to sell a portion of the shares of Common Stock to satisfy the Company’s withholding obligation and
whereby the broker-dealer irrevocably commits to forward the proceeds necessary to satisfy the Company’s withholding obligation directly to the Company, or (iii) withholding from any shares of Common Stock otherwise issuable to a
Participant a number of whole shares having a fair market value as of the date of payment not in excess of the minimum amount of tax required to be withheld by the Company by law. The Company may require the Participant to satisfy any remaining
amount of the tax withholding obligations by tendering a cash payment. Each Participant is encouraged to contact his or her personal legal or tax advisors with respect to the benefits provided by the Bonus Plan. Neither the Company nor any of its
employees, directors, officers or agents are authorized to provide any tax advice to Participants with respect to the benefits provided under the Bonus Plan. 

(d)    Deferral. The Committee may defer payment of Bonus Awards payable in cash pursuant to
Section 6(b), or any portion thereof, to Participants in accordance with Section 409A of the Code as the Committee, in its sole discretion, determines to be necessary or desirable to preserve the deductibility of such amounts under
Section 162(m). In addition, the Committee, in its sole discretion, may permit a Participant to defer receipt of the payment of cash that would otherwise be delivered to a Participant under the Bonus Plan. Any such deferral elections shall
comply with the requirements of Section 409A of the Code, and shall be subject to such rules and procedures as shall be determined by the Committee in its sole discretion. 

7.    Amendment and Termination of the Bonus Plan. The Committee may amend, modify, suspend or terminate the
Bonus Plan, in whole or in part, at any time, including adopting amendments deemed necessary or desirable to correct any defect or to supply omitted data or to reconcile any inconsistency in the Bonus Plan or in any Bonus Award granted
hereunder; provided, however, that no amendment, alteration, suspension or discontinuation shall be made that would (i) increase the amount of compensation payable pursuant to such Bonus Award, (ii) cause compensation that is,
or may become, payable hereunder to fail to qualify as Performance-Based Compensation, or (iii) change the payment dates of any shares of Common Stock if such change would fail to comply with the requirements of Section 409A of the Code.
To the extent necessary or advisable under applicable law, including Section 162(m), Bonus Plan amendments shall be subject to stockholder approval. At no time before the actual distribution of funds to Participants under the Bonus Plan shall
any Participant accrue any vested interest or right whatsoever under the Bonus Plan except as otherwise stated in the Bonus Plan. 

8.    Bifurcation of the Bonus Plan. It is the intent of the Company that the Bonus Plan, and all payments made
hereunder, satisfy and be interpreted in a manner that, in the case of Participants whose compensation is subject to the limitations on deductibility of compensation provided under Section 162(m) and whose payment hereunder is intended to
qualify as Performance-Based Compensation, qualify as Performance-Based Compensation. Any provision, application or interpretation of the Bonus Plan inconsistent with this intent to satisfy the requirements of

  
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Section 162(m) shall be disregarded. However, notwithstanding anything to the contrary in the Bonus Plan, the provisions of the Bonus Plan may at any time be bifurcated by the Board or the
Committee in any manner so that certain provisions of the Bonus Plan or any payment intended (or required) to satisfy the applicable requirements of Section 162(m) are applicable only to persons whose compensation is subject to the limitations
on deductibility of compensation provided under Section 162(m) and whose payment hereunder is intended to qualify as Performance-Based Compensation. 

9.    No Guarantee of Employment. The Bonus Plan is intended to provide a financial incentive to Participants and is
not intended to confer any rights to continued employment upon Participants whose employment will remain at-will and subject to termination by either the Company or Participant at any time, with or
without cause or notice. 
 10.    Recovery. Any amounts paid (or shares of Common Stock granted) under this Bonus
Plan will be subject to recoupment in accordance with any clawback policy that the Company is required to adopt pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or
as is otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection Act or other applicable law. No recovery of compensation under such a clawback policy will be an event giving rise to a right to resign for “good reason”
or “constructive termination” (or similar term) under any plan of or agreement with the Company. 

  
 6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00279-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00279-of-00352.parquet"}]]