Document:

Exhibit

EXHIBIT 10.6

Healthpeak Properties, INC.
2014 PERFORMANCE INCENTIVE PLAN
(As Amended and Restated October 24, 2019)

		
	1.
	PURPOSE OF PLAN

The purpose of this Healthpeak Properties, Inc. 2014 Performance Incentive Plan (this “Plan”) of Healthpeak Properties, Inc., a Maryland corporation (the “Corporation”), is to promote the success of the Corporation and to increase stockholder value by providing an additional means through the grant of awards to attract, motivate, retain and reward selected employees and other eligible persons.
		
	2.
	ELIGIBILITY

The Administrator (as such term is defined in Section 3.1) may grant awards under this Plan only to those persons that the Administrator determines to be Eligible Persons.  An “Eligible Person” is any person who is either: (a) an officer (whether or not a director) or employee of the Corporation or one of its Subsidiaries; (b) a director of the Corporation or one of its Subsidiaries; or (c) an individual consultant or advisor who renders or has rendered bona fide services (other than services in connection with the offering or sale of securities of the Corporation or one of its Subsidiaries in a capital-raising transaction or as a market maker or promoter of securities of the Corporation or one of its Subsidiaries) to the Corporation or one of its Subsidiaries and who is selected to participate in this Plan by the Administrator; provided, however, that a person who is otherwise an Eligible Person under clause (c) above may participate in this Plan only if such participation would not adversely affect either the Corporation’s eligibility to use Form S-8 to register under the Securities Act of 1933, as amended (the “Securities Act”), the offering and sale of shares issuable under this Plan by the Corporation or the Corporation’s compliance with any other applicable laws.  An Eligible Person who has been granted an award (a “participant”) may, if otherwise eligible, be granted additional awards if the Administrator shall so determine.  As used herein, “Subsidiary” means any corporation or other entity a majority of whose outstanding voting stock or voting power is beneficially owned directly or indirectly by the Corporation; and “Board” means the Board of Directors of the Corporation.
		
	3.
	PLAN ADMINISTRATION

		
	3.1.
	The Administrator.  This Plan shall be administered by and all awards under this Plan shall be authorized by the Administrator.  The “Administrator” means the Board or one or more committees appointed by the Board or another committee (within its delegated authority) to administer all or certain aspects of this Plan.  Any such committee shall be comprised solely of one or more directors or such number of directors as may be required under applicable law.  A committee may delegate some or all of its authority to another committee so constituted.  The Board or a committee comprised solely of directors may also delegate, to the extent permitted by applicable law, to one or more officers of the Corporation, its powers under this Plan (a) to designate the officers and employees of the Corporation and its Subsidiaries who will receive grants of awards under this Plan, and (b) to determine the number of shares subject to, and the other terms and conditions of, such awards.  The Board may delegate different levels of authority to different committees with administrative and grant authority under this Plan.

With respect to awards intended to satisfy the requirements for performance-based compensation under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), this Plan shall be administered by a committee consisting solely of two or more outside directors (as this requirement is applied under Section 162(m) of the Code); provided, however, that the failure to satisfy such requirement shall not affect the validity of the action of any committee otherwise duly authorized and acting in the matter.  Award grants, and transactions in or involving awards, intended to be exempt under Rule 16b-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), must be duly and timely authorized by the Board or a committee consisting solely of two or more non-employee directors (as this requirement is applied under Rule 16b-3 promulgated under the Exchange 

EXHIBIT 10.6

Act).  To the extent required by any applicable listing agency, this Plan shall be administered by a committee composed entirely of independent directors (within the meaning of the applicable listing agency).
		
	3.2.
	Powers of the Administrator.  Subject to the express provisions of this Plan, the Administrator is authorized and empowered to do all things necessary or desirable in connection with the authorization of awards and the administration of this Plan (in the case of a committee or delegation to one or more officers, within the authority delegated to that committee or person(s)), including, without limitation, the authority to:

		
	(a)
	determine eligibility and, from among those persons determined to be eligible, the particular Eligible Persons who will receive an award under this Plan;

		
	(b)
	grant awards to Eligible Persons, determine the price at which securities will be offered or awarded and the number of securities to be offered or awarded to any of such persons, determine the other specific terms and conditions of such awards consistent with the express limits of this Plan, establish the installments (if any) in which such awards shall become exercisable or shall vest (which may include, without limitation, performance and/or time-based schedules), or determine that no delayed exercisability or vesting is required, establish any applicable performance targets, and establish the events of termination or reversion of such awards;

		
	(c)
	approve the forms of award agreements (which need not be identical either as to type of award or among participants);

		
	(d)
	construe and interpret this Plan and any agreements defining the rights and obligations of the Corporation, its Subsidiaries, and participants under this Plan, further define the terms used in this Plan, and prescribe, amend and rescind rules and regulations relating to the administration of this Plan or the awards granted under this Plan;

		
	(e)
	cancel, modify, or waive the Corporation’s rights with respect to, or modify, discontinue, suspend, or terminate any or all outstanding awards, subject to any required consent under Section 8.6.5;

		
	(f)
	subject to the requirements of Section 409A of the Code (to the extent applicable), accelerate or extend the vesting or exercisability or extend the term of any or all such outstanding awards (in the case of options or stock appreciation rights, within the maximum ten-year term of such awards) in such circumstances as the Administrator may deem appropriate (including, without limitation, in connection with a termination of employment or services or other events of a personal nature) subject to any required consent under Section 8.6.5;

		
	(g)
	adjust the number of shares of Common Stock subject to any award, adjust the price of any or all outstanding awards or otherwise change previously imposed terms and conditions, in such circumstances as the Administrator may deem appropriate, in each case subject to Sections 4 and 8.6 (subject to the no repricing provision below);

		
	(h)
	determine the date of grant of an award, which may be a designated date after but not before the date of the Administrator’s action (unless otherwise designated by the Administrator, the date of grant of an award shall be the date upon which the Administrator took the action granting an award);

		
	(i)
	determine whether, and the extent to which, adjustments are required pursuant to Section 7 hereof and authorize the termination, conversion, substitution or succession of awards upon the occurrence of an event of the type described in Section 7;

		
	(j)
	acquire or settle (subject to Sections 7 and 8.6) rights under awards in cash, stock of equivalent value, or other consideration (subject to the no repricing provision below); 

EXHIBIT 10.6

		
	(k)
	determine the fair market value of the Common Stock or awards under this Plan from time to time and/or the manner in which such value will be determined; and

		
	(l)
	prescribe, amend and rescind rules and regulations relating to this Plan, including rules and regulations relating to sub-plans established for the purpose of satisfying applicable foreign laws or for qualifying for favorable tax treatment under applicable foreign laws.

Notwithstanding the foregoing and except for an adjustment pursuant to Section 7.1 or a repricing approved by stockholders, in no case may the Administrator (1) amend an outstanding stock option or SAR to reduce the exercise price or base price of the award, (2) cancel, exchange or surrender an outstanding stock option or SAR in exchange for cash or other awards for the purpose of repricing the award, or (3) cancel, exchange, or surrender an outstanding stock option or SAR in exchange for an option or SAR with an exercise or base price that is less than the exercise or base price of the original award.
		
	3.3.
	Binding Determinations.  Any action taken by, or inaction of, the Corporation, any Subsidiary, or the Administrator relating or pursuant to this Plan and within its authority hereunder or under applicable law shall be within the absolute discretion of that entity or body and shall be conclusive and binding upon all persons.  Neither the Board nor any Board committee, nor any member thereof or person acting at the direction thereof, shall be liable for any act, omission, interpretation, construction or determination made in good faith in connection with this Plan (or any award made under this Plan), and all such persons shall be entitled to indemnification and reimbursement by the Corporation in respect of any claim, loss, damage or expense (including, without limitation, attorneys’ fees) arising or resulting therefrom to the fullest extent permitted by law and/or under any directors and officers liability insurance coverage that may be in effect from time to time.

		
	3.4.
	Reliance on Experts.  In making any determination or in taking or not taking any action under this Plan, the Board or a committee, as the case may be, may obtain and may rely upon the advice of experts, including employees and professional advisors to the Corporation.  No director, officer or agent of the Corporation or any of its Subsidiaries shall be liable for any such action or determination taken or made or omitted in good faith.

		
	4.
	SHARES OF COMMON STOCK SUBJECT TO THE PLAN; SHARE LIMITS

		
	4.1.
	Shares Available.  Subject to the provisions of Section 7.1, the capital stock that may be delivered under this Plan shall be shares of the Corporation’s authorized but unissued Common Stock and any shares of its Common Stock held as treasury shares.  For purposes of this Plan, “Common Stock” shall mean the common stock of the Corporation and such other securities or property as may become the subject of awards under this Plan, or may become subject to such awards, pursuant to an adjustment made under Section 7.1.

		
	4.2.
	Share Limits.  The maximum number of shares of Common Stock that may be delivered pursuant to awards granted to Eligible Persons under this Plan (the “Share Limit”) is equal to 33,000,000 shares of Common Stock.

Shares issued in respect of any “Full-Value Award” granted under this Plan shall be counted against the foregoing Share Limit as 1.5 shares for every one share actually issued in connection with such award.  (For example, if a stock bonus of 100 shares of Common Stock is granted under this Plan, 150 shares shall be charged against the Share Limit in connection with that award.) For this purpose, a “Full-Value Award” means any award under this Plan that is not a stock option grant or a stock appreciation right grant.
The following limits also apply with respect to awards granted under this Plan:

EXHIBIT 10.6

		
	i.
	The maximum number of shares of Common Stock that may be delivered pursuant to options qualified as incentive stock options granted under this Plan is 14,000,000 shares.

		
	ii.
	The maximum number of shares of Common Stock subject to those options and stock appreciation rights that are granted during any calendar year to any individual under this Plan is 2,000,000 shares.

		
	iii.
	The maximum value of any awards granted to an Eligible Person who is a non-employee director in any consecutive 12-month period is $250,000.

		
	iv.
	Additional limits with respect to Performance-Based Awards are set forth in Section 5.2.3. 

Each of the foregoing numerical limits is subject to adjustment as contemplated by Section 4.3, Section 7.1, and Section 8.10.
		
	4.3.
	Awards Settled in Cash, Reissue of Awards and Shares.  To the extent that an award is settled in cash or a form other than shares of Common Stock, the shares that would have been delivered had there been no such cash or other settlement shall not be counted against the shares available for issuance under this Plan.  In the event that shares of Common Stock are delivered in respect of a dividend equivalent right granted under this Plan, the actual number of shares delivered with respect to the award shall be counted against the share limits of this Plan (including, for purposes of clarity, the limits of Section 4.2 of this Plan).  (For purposes of clarity, if 1,000 dividend equivalent rights are granted and outstanding when the Corporation pays a dividend, and 50 shares are delivered in payment of those rights with respect to that dividend, 50 shares shall be counted against the share limits of this Plan).  To the extent that shares of Common Stock are delivered pursuant to the exercise of a stock appreciation right or stock option granted under this Plan, the number of underlying shares as to which the exercise related shall be counted against the applicable share limits under Section 4.2, as opposed to only counting the shares actually issued.  (For purposes of clarity, if a stock appreciation right relates to 100,000 shares and is exercised at a time when the payment due to the participant is 15,000 shares, 100,000 shares shall be charged against the applicable share limits under Section 4.2 with respect to such exercise.) Shares that are subject to or underlie awards which expire or for any reason are cancelled or terminated, are forfeited, fail to vest, or for any other reason are not paid or delivered under this Plan shall again be available for subsequent awards under this Plan.  Shares that are exchanged by a participant or withheld by the Corporation as full or partial payment in connection with any award under this Plan, as well as any shares exchanged by a participant or withheld by the Corporation or one of its Subsidiaries to satisfy the tax withholding obligations related to any award, shall not be available for subsequent awards under this Plan.  Refer to Section 8.10 for application of the foregoing share limits with respect to assumed awards.  The foregoing adjustments to the share limits of this Plan are subject to any applicable limitations under Section 162(m) of the Code with respect to awards intended as performance-based compensation thereunder.

		
	4.4.
	Reservation of Shares; No Fractional Shares; Minimum Issue.  The Corporation shall at all times reserve a number of shares of Common Stock sufficient to cover the Corporation’s obligations and contingent obligations to deliver shares with respect to awards then outstanding under this Plan (exclusive of any dividend equivalent obligations to the extent the Corporation has the right to settle such rights in cash).  No fractional shares shall be delivered under this Plan.  The Administrator may pay cash in lieu of any fractional shares in settlements of awards under this Plan.  No fewer than 100 shares may be purchased on exercise of any award (or, in the case of stock appreciation or purchase rights, no fewer than 100 rights may be exercised at any one time) unless the total number purchased or exercised is the total number at the time available for purchase or exercise under the award.

		
	5.
	AWARDS

		
	5.1.
	Type and Form of Awards.  The Administrator shall determine the type or types of award(s) to be made to each selected Eligible Person.  Awards may be granted singly, in combination or in tandem.  

EXHIBIT 10.6

Awards also may be made in combination or in tandem with, in replacement of, as alternatives to, or as the payment form for grants or rights under any other employee or compensation plan of the Corporation or one of its Subsidiaries.  The types of awards that may be granted under this Plan are (subject, in each case, to the no repricing provisions of Section 3.2):
		
	5.1.1.
	Stock Options.  A stock option is the grant of a right to purchase a specified number of shares of Common Stock during a specified period as determined by the Administrator.  An option may be intended as an incentive stock option within the meaning of Section 422 of the Code (an “ISO”) or a nonqualified stock option (an option not intended to be an ISO).  The award agreement for an option will indicate if the option is intended as an ISO; otherwise it will be deemed to be a nonqualified stock option.  The maximum term of each option (ISO or nonqualified) shall be ten (10) years.  The per share exercise price for each option shall be not less than 100% of the fair market value of a share of Common Stock on the date of grant of the option.  When an option is exercised, the exercise price for the shares to be purchased shall be paid in full in cash or such other method permitted by the Administrator consistent with Section 5.5.

		
	5.1.2.
	Additional Rules Applicable to ISOs.  To the extent that the aggregate fair market value (determined at the time of grant of the applicable option) of stock with respect to which ISOs first become exercisable by a participant in any calendar year exceeds $100,000, taking into account both Common Stock subject to ISOs under this Plan and stock subject to ISOs under all other plans of the Corporation or one of its Subsidiaries (or any parent or predecessor corporation to the extent required by and within the meaning of Section 422 of the Code and the regulations promulgated thereunder), such options shall be treated as nonqualified stock options.  In reducing the number of options treated as ISOs to meet the $100,000 limit, the most recently granted options shall be reduced first.  To the extent a reduction of simultaneously granted options is necessary to meet the $100,000 limit, the Administrator may, in the manner and to the extent permitted by law, designate which shares of Common Stock are to be treated as shares acquired pursuant to the exercise of an ISO.  ISOs may only be granted to employees of the Corporation or one of its subsidiaries (for this purpose, the term “subsidiary” is used as defined in Section 424(f) of the Code, which generally requires an unbroken chain of ownership of at least 50% of the total combined voting power of all classes of stock of each subsidiary in the chain beginning with the Corporation and ending with the subsidiary in question).  There shall be imposed in any award agreement relating to ISOs such other terms and conditions as from time to time are required in order that the option be an “incentive stock option” as that term is defined in Section 422 of the Code.  No ISO may be granted to any person who, at the time the option is granted, owns (or is deemed to own under Section 424(d) of the Code) shares of outstanding Common Stock possessing more than 10% of the total combined voting power of all classes of stock of the Corporation, unless the exercise price of such option is at least 110% of the fair market value of the stock subject to the option and such option by its terms is not exercisable after the expiration of five years from the date such option is granted.

		
	5.1.3.
	Stock Appreciation Rights.  A stock appreciation right or “SAR” is a right to receive a payment, in cash and/or Common Stock, equal to the excess of the fair market value of a specified number of shares of Common Stock on the date the SAR is exercised over the “base price” of the award, which base price shall be set forth in the applicable award agreement and shall be not less than 100% of the fair market value of a share of Common Stock on the date of grant of the SAR.  The maximum term of a SAR shall be ten (10) years.

		
	5.1.4.
	Other Awards.  The other types of awards that may be granted under this Plan include: (a) stock bonuses, restricted stock, performance stock, stock units, phantom stock, dividend equivalents, or similar rights to purchase or acquire shares, whether at a fixed or variable price or ratio related to the Common Stock, upon the passage of time, the occurrence of one or more 

EXHIBIT 10.6

events, or the satisfaction of performance criteria or other conditions, or any combination thereof; (b) any other award with a value derived from the value of or related to the Common Stock and/or returns thereon; or (c) cash awards granted consistent with Section 5.2 below.
		
	5.2.
	Section 162(m) Performance-Based Awards.  Section 162(m) Performance-Based Awards.  Any award granted under the Plan that is intended to satisfy the requirements for "performance-based compensation" within the meaning of Section 162(m) of the Code is referred to as a "Performance-Based Award" and any options and SARs that are intended to qualify as Performance-Based Awards are referred to as "Qualifying Options" and "Qualifying SARs,” respectively. The grant, vesting, exercisability or payment of Performance-Based Awards may depend (or, in the case of Qualifying Options or Qualifying SARs, may also depend) on the degree of achievement of one or more performance goals relative to a pre-established targeted level or levels using one or more of the Business Criteria set forth below (on an absolute or relative basis) for the Corporation on a consolidated basis or for one or more of the Corporation’s subsidiaries, segments, divisions or business units, or any combination of the foregoing.  Any Qualifying Option or Qualifying SAR shall be subject only to the requirements of Section 5.2.1 and 5.2.3 in order for such award to satisfy the requirements for “performance-based compensation” under Section 162(m) of the Code.  Any other Performance-Based Award shall be subject to all of the following provisions of this Section 5.2.

		
	5.2.1.
	Class; Administrator.  The eligible class of persons for Performance-Based Awards under this Section 5.2 shall be officers and employees of the Corporation or one of its Subsidiaries.  The Administrator approving Performance-Based Awards or making any certification required pursuant to Section 5.2.4 must be constituted as provided in Section 3.1 for awards that are intended as performance-based compensation under Section 162(m) of the Code.

		
	5.2.2.
	Performance Goals.  The specific performance goals for Performance-Based Awards (other than Qualifying Options and Qualifying SARs) shall be, on an absolute or relative basis, established based on one or more of the following business criteria (“Business Criteria”) as selected by the Administrator in its sole discretion: net income; pre-tax income; operating income; cash flow; earnings per share; return on equity; return on invested capital or assets; cost reduction or savings; funds from operations; funds from operations per share; funds from operations payout ratio; adjusted funds from operations; cash and/or funds available for distribution; funds available for distribution per share; funds available for distribution payout ratio; appreciation in the fair market value of Common Stock; return on investment; total return to stockholders; net earnings; earnings before or after any one or more of interest, taxes, depreciation or amortization; net debt; same store cash net operating income; dividend payout ratio; real estate or capital expenditures; non-stabilized assets, balance sheet or debt ratings management; or any combination or derivative thereof.  These terms are used as applied under generally accepted accounting principles or in the financial reporting of the Corporation or of its Subsidiaries.  To qualify awards as performance-based under Section 162(m), the applicable Business Criterion (or Business Criteria, as the case may be) and specific performance goal or goals (“targets”) must be established and approved by the Administrator during the first 90 days of the performance period (and, in the case of performance periods of less than one year, in no event after 25% or more of the performance period has elapsed) and while performance relating to such target(s) remains substantially uncertain within the meaning of Section 162(m) of the Code.  Unless otherwise provided in the applicable award agreement, performance targets shall be adjusted to mitigate the unbudgeted impact of material, unusual or nonrecurring gains and losses, accounting changes or other extraordinary events not foreseen at the time the targets were set unless the Administrator provides otherwise at the time of establishing the targets.  The applicable performance measurement period may not be less than three months nor more than 10 years.

		
	5.2.3.
	Form of Payment; Maximum Performance-Based Award.  Grants or awards under this Section 5.2 may be paid in cash or shares of Common Stock or any combination thereof.  Grants of Qualifying Options and Qualifying SARs to any one participant in any one calendar 

EXHIBIT 10.6

year shall be subject to the limit set forth in Section 4.2(b).  The maximum number of shares of Common Stock which may be delivered pursuant to Performance-Based Awards (other than Qualifying Options and Qualifying SARs, and other than cash awards covered by the following sentence) that are granted to any one participant in any one calendar year shall not exceed 1,000,000 shares, either individually or in the aggregate, subject to adjustment as provided in Section 7.1.  In addition, the aggregate amount of compensation to be paid to any one participant in respect of all Performance-Based Awards payable only in cash and not related to shares of Common Stock and granted to that participant in any one calendar year shall not exceed $5,000,000.  Awards that are cancelled during the year shall be counted against these limits to the extent required by Section 162(m) of the Code.  Performance-Based Awards shall be paid, unless otherwise determined by the Administrator, no later than 2 1⁄2 months after the tax year in which the Performance-Based Award vests, consistent with the requirements of Section 409A of the Code.
		
	5.2.4.
	Certification of Payment.  Before any Performance-Based Award under this Section 5.2 (other than Qualifying Options and Qualifying SARs) is paid and to the extent required to qualify the award as performance-based compensation within the meaning of Section 162(m) of the Code, the Administrator must certify in writing that the performance target(s) and any other material terms of the Performance-Based Award were in fact timely satisfied.

		
	5.2.5.
	Reservation of Discretion.  The Administrator will have the discretion to determine the restrictions or other limitations of the individual awards granted under this Section 5.2 including the authority to reduce awards, payouts or vesting or to pay no awards, in its sole discretion, if the Administrator preserves such authority at the time of grant by language to this effect in its authorizing resolutions or otherwise.

		
	5.2.6.
	Expiration of Grant Authority.  As required pursuant to Section 162(m) of the Code and the regulations promulgated thereunder, the Administrator’s authority to grant new awards that are intended to qualify as performance-based compensation within the meaning of Section 162(m) of the Code (other than Qualifying Options and Qualifying SARs) shall terminate upon the first meeting of the Corporation’s stockholders that occurs in the fifth year following the year in which the Corporation’s stockholders first approve this Plan.

		
	5.2.7.
	Additional Limitations.  Notwithstanding any other provision of this Plan and except as otherwise determined by the Administrator, any individual award granted under this Section 5.2 that is intended to qualify as performance-based compensation within the meaning of Section 162(m) of the Code shall be subject to any additional limitations that are requirements for qualification as performance-based compensation within the meaning of Section 162(m) of the Code, and this Plan and the applicable award agreement shall be deemed amended to the extent necessary to conform to such requirements.

		
	5.2.8.
	Dividend Equivalent Rights.  With respect to any Performance-Based Award, the Administrator may provide that the Participant will have the right to receive a dividend equivalent right, provided that such dividend equivalent right shall be subject to the same terms and conditions of the underlying award.  

		
	5.3.
	Award Agreements.  Each award shall be evidenced by either (1) a written award agreement in a form approved by the Administrator and executed by the Corporation by an officer duly authorized to act on its behalf, or (2) an electronic notice of award grant in a form approved by the Administrator and recorded by the Corporation (or its designee) in an electronic recordkeeping system used for the purpose of tracking award grants under this Plan generally (in each case, an “award agreement”), as the Administrator may provide and, in each case and if required by the Administrator, executed or otherwise electronically accepted by the recipient of the award in such form and manner as the Administrator may require.  The Administrator may authorize any officer of the Corporation (other than the particular award recipient) to execute any or all award agreements on behalf of the Corporation.  

EXHIBIT 10.6

The award agreement shall set forth the material terms and conditions of the award as established by the Administrator consistent with the express limitations of this Plan.  Any award agreement evidencing awards intended to qualify as performance-based compensation within the meaning of Section 162(m) of the Code shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code.
		
	5.4.
	Deferrals and Settlements.  Payment of awards may be in the form of cash, Common Stock, other awards or combinations thereof as the Administrator shall determine, and with such restrictions as it may impose.  The Administrator may also require or permit participants to elect to defer the issuance of shares or the settlement of awards in cash under such rules and procedures as it may establish under this Plan.  The Administrator may also provide that deferred settlements include the payment or crediting of interest or other earnings on the deferral amounts, or the payment or crediting of dividend equivalents where the deferred amounts are denominated in shares.

		
	5.5.
	Consideration for Common Stock or Awards.  Except as provided herein, the purchase price for any award granted under this Plan or the Common Stock to be delivered pursuant to an award, as applicable, may be paid by means of any lawful consideration as determined by the Administrator, including, without limitation, one or a combination of the following methods:

		
	•
	services rendered by the recipient of such award;

		
	•
	cash, check payable to the order of the Corporation, or electronic funds transfer;

		
	•
	notice and third party payment in such manner as may be authorized by the Administrator;

		
	•
	the delivery of previously owned shares of Common Stock;

		
	•
	by a reduction in the number of shares otherwise deliverable pursuant to the award; or

		
	•
	subject to such procedures as the Administrator may adopt, pursuant to a “cashless exercise” with a third party who provides financing for the purposes of (or who otherwise facilitates) the purchase or exercise of awards.

In no event shall any shares newly-issued by the Corporation be issued for less than the minimum lawful consideration for such shares or for consideration other than consideration permitted by applicable state law.  The Administrator shall not permit any participant to pay any portion of the exercise or purchase price of any award granted under this Plan by means of a promissory note.  Shares of Common Stock used to satisfy the exercise price of an option shall be valued at their fair market value on the date of exercise.  The Corporation will not be obligated to deliver any shares unless and until it receives full payment of the exercise or purchase price therefor and any related withholding obligations under Section 8.5 and any other conditions to exercise or purchase have been satisfied.  Unless otherwise expressly provided in the applicable award agreement, the Administrator may at any time eliminate or limit a participant’s ability to pay the purchase or exercise price of any award or shares by any method other than cash payment to the Corporation.
		
	5.6.
	Definition of Fair Market Value.  For purposes of this Plan, “fair market value” shall mean, unless otherwise determined or provided by the Administrator in the circumstances, the closing price of a share of Common Stock as reported on the composite tape for securities listed on the New York Stock Exchange (the “Exchange”) for the date in question or, if no sales of Common Stock were made on the Exchange on that date, the average of the closing prices of a share of Common Stock as reported on said composite tape for the next preceding day and the next succeeding day on which sales of Common Stock were made on the Exchange.  The Administrator may, however, provide with respect to one or more awards that the fair market value shall equal the closing price of a share of Common Stock as reported on the composite tape for securities listed on the Exchange for the last trading day prior to the date in question or the average of the high and low trading prices of a share of Common Stock as reported on the composite tape for securities listed on the Exchange for the date in question 

EXHIBIT 10.6

or the most recent trading day.  If the Common Stock is no longer listed or is no longer actively traded on the Exchange as of the applicable date, the fair market value of the Common Stock shall be the value as reasonably determined by the Administrator for purposes of the award in the circumstances.  The Administrator also may adopt a different methodology for determining fair market value with respect to one or more awards if a different methodology is necessary or advisable to secure any intended favorable tax, legal or other treatment for the particular award(s) (for example, and without limitation, the Administrator may provide that fair market value for purposes of one or more awards will be based on an average of closing prices (or the average of high and low daily trading prices) for a specified period preceding the relevant date).
		
	5.7.
	Transfer Restrictions.

		
	5.7.1.
	Limitations on Exercise and Transfer.  Unless otherwise expressly provided in (or pursuant to) this Section 5.7, by applicable law and by the award agreement, as the same may be amended, (a) all awards are non-transferable and shall not be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge; (b) awards shall be exercised only by the participant; and (c) amounts payable or shares issuable pursuant to any award shall be delivered only to (or for the account of) the participant.

		
	5.7.2.
	Exceptions.  The Administrator may permit awards to be exercised by and paid to, or otherwise transferred to, other persons or entities pursuant to such conditions and procedures, including limitations on subsequent transfers, as the Administrator may, in its sole discretion, establish in writing.  Any permitted transfer shall be subject to compliance with applicable federal and state securities laws and shall not be for value (other than nominal consideration, settlement of marital property rights, or for interests in an entity in which more than 50% of the voting interests are held by the Eligible Person or by the Eligible Person’s family members).

		
	5.7.3.
	Further Exceptions to Limits on Transfer.  The exercise and transfer restrictions in Section 5.7.1 shall not apply to:

		
	(a)
	transfers to the Corporation (for example, in connection with the expiration or termination of the award),

		
	(b)
	the designation of a beneficiary to receive benefits in the event of the participant’s death or, if the participant has died, transfers to or exercise by the participant’s beneficiary, or, in the absence of a validly designated beneficiary, transfers by will or the laws of descent and distribution,

		
	(c)
	subject to any applicable limitations on ISOs, transfers to a family member (or former family member) pursuant to a domestic relations order if approved or ratified by the Administrator,

		
	(d)
	if the participant has suffered a disability, permitted transfers or exercises on behalf of the participant by his or her legal representative, or

		
	(e)
	the authorization by the Administrator of “cashless exercise” procedures with third parties who provide financing for the purpose of (or who otherwise facilitate) the exercise of awards consistent with applicable laws and the express authorization of the Administrator.

		
	5.8.
	International Awards.  One or more awards may be granted to Eligible Persons who provide services to the Corporation or one of its Subsidiaries outside of the United States.  Any awards granted to such persons may be granted pursuant to the terms and conditions of any applicable sub-plans, if any, appended to this Plan and approved by the Administrator.

		
	5.9.
	Minimum Vesting Conditions.

EXHIBIT 10.6

		
	5.9.1.
	Any award granted hereunder shall provide for a time-based or performance-based vesting schedule, as applicable, of at least one (1) year following the date of grant.

		
	5.9.2.
	Notwithstanding anything set forth in Section 5.9.1 to the contrary, awards representing a maximum of five percent (5%) of the Share Limit may be granted hereunder without any minimum vesting condition.

		
	6.
	EFFECT OF TERMINATION OF SERVICE ON AWARDS

		
	6.1.
	General.  The Administrator shall establish the effect of a termination of employment or service on the rights and benefits under each award under this Plan and in so doing may make distinctions based upon, inter alia, the cause of termination and type of award.  If the participant is not an employee of the Corporation or one of its Subsidiaries and provides other services to the Corporation or one of its Subsidiaries, the Administrator shall be the sole judge for purposes of this Plan (unless a contract or the award otherwise provides) of whether the participant continues to render services to the Corporation or one of its Subsidiaries and the date, if any, upon which such services shall be deemed to have terminated.

		
	6.2.
	Events Not Deemed Terminations of Service.  Unless the express policy of the Corporation or one of its Subsidiaries, or the Administrator, otherwise provides, the employment relationship shall not be considered terminated in the case of (a) sick leave, (b) military leave, or (c) any other leave of absence authorized by the Corporation or one of its Subsidiaries, or the Administrator; provided that, unless reemployment upon the expiration of such leave is guaranteed by contract or law, or the Administrator otherwise provides, such leave is for a period of not more than three months.  In the case of any employee of the Corporation or one of its Subsidiaries on an approved leave of absence, continued vesting of the award while on leave from the employ of the Corporation or one of its Subsidiaries may be suspended until the employee returns to service, unless the Administrator otherwise provides or applicable law otherwise requires.  In no event shall an award be exercised after the expiration of the term set forth in the award agreement.

		
	6.3.
	Effect of Change of Subsidiary Status.  For purposes of this Plan and any award, if an entity ceases to be a Subsidiary of the Corporation a termination of employment or service shall be deemed to have occurred with respect to each Eligible Person in respect of such Subsidiary who does not continue as an Eligible Person in respect of another entity within the Corporation or another Subsidiary that continues as such after giving effect to the transaction or other event giving rise to the change in status.

		
	7.
	ADJUSTMENTS; ACCELERATION

		
	7.1.
	Adjustments.  Subject to Section 7.2, upon (or, as may be necessary to effect the adjustment, immediately prior to): any reclassification, recapitalization, stock split (including a stock split in the form of a stock dividend) or reverse stock split; any merger, combination, consolidation, or other reorganization; any spin-off, split-up, or similar extraordinary dividend distribution in respect of the Common Stock; or any exchange of Common Stock or other securities of the Corporation, or any similar, unusual or extraordinary corporate transaction in respect of the Common Stock; then the Administrator shall equitably and proportionately adjust (1) the number and type of shares of Common Stock (or other securities) that thereafter may be made the subject of awards (including the specific share limits, maximums and numbers of shares set forth elsewhere in this Plan), (2) the number, amount and type of shares of Common Stock (or other securities or property) subject to any outstanding awards, (3) the grant, purchase, or exercise price (which term includes the base price of any SAR or similar right) of any outstanding awards, and/or (4) the securities, cash or other property deliverable upon exercise or payment of any outstanding awards, in each case to the extent necessary to preserve (but not increase) the level of incentives intended by this Plan and the then-outstanding awards.

Unless otherwise expressly provided in the applicable award agreement, upon (or, as may be necessary to effect the adjustment, immediately prior to) any event or transaction described in the preceding paragraph or a sale of all or substantially all of the business or assets of the Corporation as an entirety, 

EXHIBIT 10.6

the Administrator shall equitably and proportionately adjust the performance standards applicable to any then-outstanding performance-based awards to the extent necessary to preserve (but not increase) the level of incentives intended by this Plan and the then-outstanding performance-based awards.
It is intended that, if possible, any adjustments contemplated by the preceding two paragraphs be made in a manner that satisfies applicable U.S. legal, tax (including, without limitation and as applicable in the circumstances, Section 424 of the Code, Section 409A of the Code and Section 162(m) of the Code) and accounting (so as to not trigger any charge to earnings with respect to such adjustment) requirements.
Without limiting the generality of Section 3.3, any good faith determination by the Administrator as to whether an adjustment is required in the circumstances pursuant to this Section 7.1, and the extent and nature of any such adjustment, shall be conclusive and binding on all persons.
		
	7.2.
	Corporate Transactions-Assumption and Termination of Awards.  Upon the occurrence of any of the following: any merger, combination, consolidation, or other reorganization; any exchange of Common Stock or other securities of the Corporation; a sale of all or substantially all the business, stock or assets of the Corporation; a dissolution of the Corporation; or any other event in which the Corporation does not survive (or does not survive as a public company in respect of its Common Stock); then the Administrator may make provision for a cash payment in settlement of, or for the assumption, substitution or exchange of any or all outstanding share-based awards or the cash, securities or property deliverable to the holder of any or all outstanding share-based awards, based upon, to the extent relevant under the circumstances, the distribution or consideration payable to holders of the Common Stock upon or in respect of such event.  Upon the occurrence of any event described in the preceding sentence, then, unless the Administrator has made a provision for the substitution, assumption, exchange or other continuation or settlement of the award or the award would otherwise continue in accordance with its terms in the circumstances: (1) unless otherwise provided in the applicable award agreement, each then-outstanding option and SAR shall become fully vested, all shares of restricted stock then outstanding shall fully vest free of restrictions, and each other award granted under this Plan that is then outstanding shall become payable to the holder of such award; and (2) each award shall terminate upon the related event; provided that the holder of an option or SAR shall be given reasonable advance notice of the impending termination and a reasonable opportunity to exercise his or her outstanding vested options and SARs (after giving effect to any accelerated vesting required in the circumstances) in accordance with their terms before the termination of such awards (except that in no case shall more than ten days’ notice of the impending termination be required and any acceleration of vesting and any exercise of any portion of an award that is so accelerated may be made contingent upon the actual occurrence of the event).

The Administrator may adopt such valuation methodologies for outstanding awards as it deems reasonable in the event of a cash or property settlement and, in the case of options, SARs or similar rights, but without limitation on other methodologies, may base such settlement solely upon the excess if any of the per share amount payable upon or in respect of such event over the exercise or base price of the award.
In any of the events referred to in this Section 7.2 or in Section 7.3, the Administrator may take such action contemplated by this Section 7.2 or Section 7.3 prior to such event (as opposed to on the occurrence of such event) to the extent that the Administrator deems the action necessary to permit the participant to realize the benefits intended to be conveyed with respect to the underlying shares.  Without limiting the generality of the foregoing, the Administrator may deem an acceleration to occur immediately prior to the applicable event and/or reinstate the original terms of the award if an event giving rise to an acceleration does not occur.
Without limiting the generality of Section 3.3, any good faith determination by the Administrator pursuant to its authority under this Section 7.2 shall be conclusive and binding on all persons.

EXHIBIT 10.6

		
	7.3.
	Possible Acceleration of Awards.  Without limiting Section 7.2, in the event of a Change in Control Event (as defined below), the Administrator may, in its discretion, provide that any outstanding option or SAR shall become fully vested, that any share of restricted stock then outstanding shall fully vest free of restrictions, and, subject to compliance with the requirements of Section 409A of the Code, that any other award granted under this Plan that is then outstanding shall be payable to the holder of such award.  The Administrator may take such action with respect to all awards then outstanding or only with respect to certain specific awards identified by the Administrator in the circumstances.  For purposes of this Plan, “Change in Control Event” means the occurrence of any of the following after the Effective Date:

		
	(a)
	The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”))  of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either (1) the then-outstanding shares of common stock of the Corporation (the “Outstanding Company Common Stock”) or (2) the combined voting power of the then-outstanding voting securities of the Corporation entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that, for purposes of this clause (a), the following acquisitions shall not constitute a Change in Control Event; (A) any acquisition directly from the Corporation, (B) any acquisition by the Corporation, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any affiliate of the Corporation or a successor, (D) any acquisition by any entity pursuant to a transaction that complies with clauses (c)(1), (2) and (3) below, and (E) any acquisition by a Person who owned at least 25% of either the Outstanding Company Common Stock or the Outstanding Company Voting Securities as of the Effective Date or an affiliate of any such Person;

		
	(b)
	A change in the Board or its members such that individuals who, as of the later of the Effective Date or the date that is two years prior to such change (the later of such two dates is referred to as the “Measurement Date”), constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Measurement Date whose election, or nomination for election by the Corporation’s stockholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board (including for these purposes, the new members whose election or nomination was so approved, without counting the member and his predecessor twice) shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board;

		
	(c)
	Consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Corporation or any of its Subsidiaries, a sale or other disposition of all or substantially all of the assets of the Corporation, or the acquisition of assets or stock of another entity by the Corporation or any of its Subsidiaries (each, a “Business Combination”), in each case unless, following such Business Combination, (1) all or substantially all of the individuals and entities that were the beneficial owners of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 66 2/3% of the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Corporation or all or substantially all of the Corporation’s assets directly or through one or more subsidiaries (a “Parent”)) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Company Common Stock and the Outstanding 

EXHIBIT 10.6

Company Voting Securities, as the case may be, (2) no Person (excluding any entity resulting from such Business Combination or a Parent or any employee benefit plan (or related trust) of the Corporation or such entity resulting from such Business Combination or Parent) beneficially owns, directly or indirectly, more than 25% of, respectively, the then-outstanding shares of common stock of the entity resulting from such Business Combination or the combined voting power of the then-outstanding voting securities of such entity, except to the extent that the ownership in excess of 25% existed prior to the Business Combination, and (3) at least a majority of the members of the board of directors or trustees of the entity resulting from such Business Combination or a Parent were members of the Incumbent Board (determined pursuant to clause (b) above using the date that is the later of the Effective Date or the date that is two years prior to the Business Combination as the Measurement Date) at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or
		
	(d)
	Approval by the stockholders of the Corporation of a complete liquidation or dissolution of the Corporation other than in the context of a transaction that does not constitute a Change in Control Event under clause (c) above.

Notwithstanding the foregoing, if a Change in Control Event constitutes a payment event with respect to any award which provides for the deferral of compensation that is subject to Section 409A of the Code, to the extent required to avoid the imposition of additional taxes under Section 409A of the Code, the transaction or event described in clause (a), (b), (c) or (d) with respect to such award shall only constitute a Change in Control Event for purposes of the payment timing of such award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation 1.409A-3(i)(5).  The Administrator shall have full and final authority to determine conclusively whether a Change in Control Event of the Corporation has occurred pursuant to the above definition, the date of the occurrence of such Change in Control Event and any incidental matters relating thereto.
		
	7.4.
	Other Acceleration Rules.  The Administrator may override the provisions of Section 7.2 and/or 7.3 by express provision in the award agreement and may accord any Eligible Person a right to refuse any acceleration, whether pursuant to the award agreement or otherwise, in such circumstances as the Administrator may approve.  The portion of any ISO accelerated in connection with a Change in Control Event or any other action permitted hereunder shall remain exercisable as an ISO only to the extent the applicable $100,000 limitation on ISOs is not exceeded.  To the extent exceeded, the accelerated portion of the option shall be exercisable as a nonqualified stock option under the Code.

		
	8.
	OTHER PROVISIONS

		
	8.1.
	Compliance with Laws.  This Plan, the granting and vesting of awards under this Plan, the offer, issuance and delivery of shares of Common Stock, and/or the payment of money under this Plan or under awards are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities law, federal margin requirements) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Corporation, be necessary or advisable in connection therewith.  The person acquiring any securities under this Plan will, if requested by the Corporation or one of its Subsidiaries, provide such assurances and representations to the Corporation or one of its Subsidiaries as the Administrator may deem necessary or desirable to assure compliance with all applicable legal and accounting requirements.

		
	8.2.
	No Rights to Award.  No person shall have any claim or rights to be granted an award (or additional awards, as the case may be) under this Plan, subject to any express contractual rights (set forth in a document other than this Plan) to the contrary.

		
	8.3.
	No Employment/Service Contract.  Nothing contained in this Plan (or in any other documents under this Plan or in any award) shall confer upon any Eligible Person or other participant any right to continue in the employ or other service of the Corporation or one of its Subsidiaries, constitute any 

EXHIBIT 10.6

contract or agreement of employment or other service or affect an employee’s status as an employee at will, nor shall interfere in any way with the right of the Corporation or one of its Subsidiaries to change a person’s compensation or other benefits, or to terminate his or her employment or other service, with or without cause.  Nothing in this Section 8.3, however, is intended to adversely affect any express independent right of such person under a separate employment or service contract other than an award agreement.
		
	8.4.
	Plan Not Funded.  Awards payable under this Plan shall be payable in shares or from the general assets of the Corporation, and no special or separate reserve, fund or deposit shall be made to assure payment of such awards.  No participant, beneficiary or other person shall have any right, title or interest in any fund or in any specific asset (including shares of Common Stock, except as expressly otherwise provided) of the Corporation or one of its Subsidiaries by reason of any award hereunder.  Neither the provisions of this Plan (or of any related documents), nor the creation or adoption of this Plan, nor any action taken pursuant to the provisions of this Plan shall create, or be construed to create, a trust of any kind or a fiduciary relationship between the Corporation or one of its Subsidiaries and any participant, beneficiary or other person.  To the extent that a participant, beneficiary or other person acquires a right to receive payment pursuant to any award hereunder, such right shall be no greater than the right of any unsecured general creditor of the Corporation.

		
	8.5.
	Tax Withholding.  Upon any exercise, vesting, or payment of any award or upon the disposition of shares of Common Stock acquired pursuant to the exercise of an ISO prior to satisfaction of the holding period requirements of Section 422 of the Code,  or upon any other tax withholding event with respect to any award, the Corporation or one of its Subsidiaries shall have the right at its option to:

		
	i.
	require the participant (or the participant’s personal representative or beneficiary, as the case may be) to pay or provide for payment of the amount of any taxes which the Corporation or one of its Subsidiaries may be required to withhold with respect to such award event or payment; or

		
	ii.
	deduct from any amount otherwise payable in cash to the participant (or the participant’s personal representative or beneficiary, as the case may be), whether related to the award or not, the amount of any taxes which the Corporation or one of its Subsidiaries may be required to withhold with respect to such cash payment.

In any case where a tax is required to be withheld in connection with the delivery of shares of Common Stock under this Plan, the Administrator may in its sole discretion (subject to Section 8.1) require or grant (either at the time of the award or thereafter) to the participant the right to elect, pursuant to such rules and subject to such conditions as the Administrator may establish, that the Corporation reduce the number of shares to be delivered by (or otherwise reacquire) the appropriate number of shares, valued in a consistent manner at their fair market value or at the sales price in accordance with authorized procedures for cashless exercises, necessary to satisfy the applicable withholding obligation on exercise, vesting or payment.  The Corporation may not accept a promissory note from any Eligible Person in connection with taxes required to be withheld upon the exercise, vesting or payment of any award under this Plan.
		
	8.6.
	Effective Date, Termination and Suspension, Amendments.

		
	8.6.1.
	Effective Date.  This Plan is effective as of January 30, 2014, the date of its approval by the Board (the “Effective Date”).  This Plan shall be submitted for and subject to stockholder approval no later than twelve months after the Effective Date.  Unless earlier terminated by the Board, this Plan shall terminate at the close of business on the day before the tenth anniversary of the Effective Date.  After the termination of this Plan either upon such stated expiration date or its earlier termination by the Board, no additional awards may be granted under this Plan, but previously granted awards (and the authority of the Administrator with respect thereto, including the authority to amend such awards) shall remain outstanding in 

EXHIBIT 10.6

accordance with their applicable terms and conditions and the terms and conditions of this Plan.
		
	8.6.2.
	Board Authorization.  The Board may, at any time, terminate or, from time to time, amend, modify or suspend this Plan, in whole or in part.  No awards may be granted during any period that the Board suspends this Plan.

		
	8.6.3.
	Stockholder Approval.  To the extent then required by applicable law or any applicable listing agency or required under Sections 162, 422 or 424 of the Code to preserve the intended tax consequences of this Plan, or deemed necessary or advisable by the Board, any amendment to this Plan shall be subject to stockholder approval.

		
	8.6.4.
	Amendments to Awards.  Without limiting any other express authority of the Administrator under (but subject to) the express limits of this Plan and the no repricing provision of Section 3.2, the Administrator by agreement or resolution may waive conditions of or limitations on awards to participants that the Administrator in the prior exercise of its discretion has imposed, without the consent of a participant, and (subject to the requirements of Sections 3.2 and 8.6.5) may make other changes to the terms and conditions of awards.

		
	8.6.5.
	Limitations on Amendments to Plan and Awards.  No amendment, suspension or termination of this Plan or amendment of any outstanding award agreement shall, without written consent of the participant, affect in any manner materially adverse to the participant any rights or benefits of the participant or obligations of the Corporation under any award granted under this Plan prior to the effective date of such change.  Changes, settlements and other actions contemplated by Section 7 shall not be deemed to constitute changes or amendments for purposes of this Section 8.6.

		
	8.7.
	Privileges of Stock Ownership.  Except as otherwise expressly authorized by the Administrator or this Plan, a participant shall not be entitled to any privilege of stock ownership as to any shares of Common Stock not actually delivered to and held of record by the participant.  No adjustment will be made for dividends or other rights as a stockholder for which a record date is prior to such date of delivery.

		
	8.8.
	Governing Law; Construction; Severability.

		
	8.8.1.
	Choice of Law.  This Plan, the awards, all documents evidencing awards and all other related documents shall be governed by, and construed in accordance with the laws of the State of Maryland.

		
	8.8.2.
	Severability.  If a court of competent jurisdiction holds any provision invalid and unenforceable, the remaining provisions of this Plan shall continue in effect.

		
	8.8.3.
	Plan Construction.

		
	(a)
	Rule 16b-3.  It is the intent of the Corporation that the awards and transactions permitted by awards be interpreted in a manner that, in the case of participants who are or may be subject to Section 16 of the Exchange Act, qualify, to the maximum extent compatible with the express terms of the award, for exemption from matching liability under Rule 16b-3 promulgated under the Exchange Act.  Notwithstanding the foregoing, the Corporation shall have no liability to any participant for Section 16 consequences of awards or events under awards if an award or event does not so qualify.

		
	8.9.
	Captions.  Captions and headings are given to the sections and subsections of this Plan solely as a convenience to facilitate reference.  Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Plan or any provision thereof.

EXHIBIT 10.6

		
	8.10.
	Stock-Based Awards in Substitution for Stock Options or Awards Granted by Other Corporation.  Awards may be granted to Eligible Persons in substitution for or in connection with an assumption of employee stock options, SARs, restricted stock or other stock-based awards granted by other entities to persons who are or who will become Eligible Persons in respect of the Corporation or one of its Subsidiaries, in connection with a distribution, merger or other reorganization by or with the granting entity or an affiliated entity, or the acquisition by the Corporation or one of its Subsidiaries, directly or indirectly, of all or a substantial part of the stock or assets of the employing entity.  The awards so granted need not comply with other specific terms of this Plan, provided the awards reflect only adjustments giving effect to the assumption or substitution consistent with the conversion applicable to the Common Stock in the transaction and any change in the issuer of the security.  Any shares that are delivered and any awards that are granted by, or become obligations of, the Corporation, as a result of the assumption by the Corporation of, or in substitution for, outstanding awards previously granted by an acquired company (or previously granted by a predecessor employer (or direct or indirect parent thereof) in the case of persons that become employed by the Corporation or one of its Subsidiaries in connection with a business or asset acquisition or similar transaction) shall not be counted against the Share Limit or other limits on the number of shares available for issuance under this Plan.

		
	8.11.
	Non-Exclusivity of Plan.  Nothing in this Plan shall limit or be deemed to limit the authority of the Board or the Administrator to grant awards or authorize any other compensation, with or without reference to the Common Stock, under any other plan or authority.

		
	8.12.
	No Corporate Action Restriction.  The existence of this Plan, the award agreements and the awards granted hereunder shall not limit, affect or restrict in any way the right or power of the Board or the stockholders of the Corporation to make or authorize: (a) any adjustment, recapitalization, reorganization or other change in the capital structure or business of the Corporation or any Subsidiary, (b) any merger, amalgamation, consolidation or change in the ownership of the Corporation or any Subsidiary, (c) any issue of bonds, debentures, capital, preferred or prior preference stock ahead of or affecting the capital stock (or the rights thereof) of the Corporation or any Subsidiary, (d) any dissolution or liquidation of the Corporation or any Subsidiary, (e) any sale or transfer of all or any part of the assets or business of the Corporation or any Subsidiary, or (f) any other corporate act or proceeding by the Corporation or any Subsidiary.  No participant, beneficiary or any other person shall have any claim under any award or award agreement against any member of the Board or the Administrator, or the Corporation or any employees, officers or agents of the Corporation or any Subsidiary, as a result of any such action.

		
	8.13.
	Other Company Benefit and Compensation Programs.  Payments and other benefits received by a participant under an award made pursuant to this Plan shall not be deemed a part of a participant’s compensation for purposes of the determination of benefits under any other employee welfare or benefit plans or arrangements, if any, provided by the Corporation or any Subsidiary, except where the Administrator expressly otherwise provides or authorizes in writing.  Awards under this Plan may be made in addition to, in combination with, as alternatives to or in payment of grants, awards or commitments under any other plans or arrangements of the Corporation or its Subsidiaries.

		
	8.14.
	Section 409A.  The intent of the parties is that payments and benefits under this Plan comply with Section 409A of the Code to the extent subject thereto, and, accordingly, to the maximum extent permitted, this Plan shall be interpreted and be administered to be in compliance therewith.  Notwithstanding anything to the contrary, a participant shall not be considered to have terminated employment with the Corporation for purposes of any payments under this Plan which are subject to Section 409A of the Code until the participant has incurred a “separation from service” from the Corporation within the meaning of Section 409A of the Code.  Any payments described in this Plan that are due within the “short-term deferral period” as defined in Section 409A of the Code shall not be treated as deferred compensation unless applicable law requires otherwise.  Notwithstanding anything to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Plan or any plan, arrangement or agreement with the Company, 

EXHIBIT 10.6

during the six (6) month period immediately following the participant’s termination of employment shall instead be paid on the first business day after the date that is six (6) months following the participant’s separation from service (or upon the participant’s death, if earlier). In addition, for purposes of this Plan, each amount to be paid or benefit to be provided to the participant pursuant to this Plan, which constitute deferred compensation subject to Section 409A of the Code, shall be construed as a separate identified payment for purposes of Section 409A of the Code. 

*    *    *exh1012020timebasedaward

                  INDEPENDENCE CONTRACT DRILLING, INC.                   RESTRICTED STOCK UNIT AWARD AGREEMENT                                  (TIME VESTING)                                    Cash Settlement                                   Grantee:  NAME          1.    Grant of Restricted Stock Unit Award.                  (a) As of _____________, the date of this agreement (this “Agreement”),   Independence Contract Drilling, Inc., a Delaware corporation (the “Company”), hereby grants to   the Grantee (identified above) ________ restricted stock units (the “RSUs”) pursuant to the   Amended and Restated Independence Contract Drilling, Inc. 2019 Omnibus Incentive Plan, as   amended (the “Plan”).  Each RSUs represent the opportunity to receive a cash payment equal to   the Fair Market Value of share of the Company’s Common Stock multiplied by the number of   vested RSUs. In the event of a conflict between the terms of the Plan and the terms of this  Agreement, the terms of the Plan shall control.            2.    Definitions.  All capitalized terms used herein shall have the meanings set forth in   the Plan unless otherwise provided herein.  Exhibits A and B set forth meanings for certain of the   capitalized terms used in this Agreement.          3.    Vesting and Forfeiture.  Except as otherwise provided in Exhibit B or any change   of control or employment agreement between Grantee and a member of the Company Group, all   unvested RSUs will be forfeited automatically by the Grantee for no consideration upon   termination for any reason of Grantee’s employment with the Company or its direct or indirect   subsidiaries (the “Company Group”) prior to the Vesting Date.  To the extent not forfeited prior   to the Vesting Date, the number of RSUs vesting shall, to the extent not vesting earlier pursuant to   Exhibit B, vest as follows:                   •  _____ RSUs shall vest on the first anniversary of the date of grant;                   •  _____ RSUs shall vest on the second anniversary of the date of grant;                  •  _____ RSUs shall vest on the third anniversary of the date of grant.          4.    Purchase Price.  No consideration shall be payable by the Grantee to the Company   for the RSUs.          5.    Restrictions on RSUs and Settlement of Vested RSUs.                  (a) No Dividend Equivalents are granted with to any RSUs. 

 

                                                      With Employment Agreement                  (b) Subject to Section 11(e) and the Plan, the Company shall settle vested RSUs        within 30 days of the date such RSUs vest.  Each vested RSU shall entitle the Grantee to        receive a cash payment equal to the Fair Market Value of one share of Common Stock         multiplied by the number of vested RSUs.                  (c) Nothing in this Agreement or the Plan shall be construed to:                      (i)   give the Grantee any right to be awarded any further RSUs or any         other Award in the future, even if RSUs or other Awards are granted on a regular or         repeated basis, as grants of RSUs and other Awards are completely voluntary and made         solely in the discretion of the Committee;                      (ii)  give the Grantee or any other person any interest in any fund or in        any specified asset or assets of the Company or any Affiliate; or                     (iii) confer upon the Grantee the right to continue in the employment or        service of the Company or any Affiliate, or affect the right of the Company or any Affiliate        to terminate the employment or service of the Grantee at any time or for any reason.               (d) The Grantee shall not have any voting rights with respect to the RSUs.          6.    Independent Legal and Tax Advice.  Grantee acknowledges that the Company   has advised Grantee to obtain independent legal and tax advice regarding the grant, holding,  vesting and settlement of the RSUs in accordance with this Agreement and any disposition of any  such Awards or the shares of Common Stock issued with respect thereto.          7.    Reorganization of Company.  The existence of this Agreement shall not affect in   any way the right or power of the Company or its stockholders to make or authorize any or all   adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure   or its business, or any merger or consolidation of the Company, or any issue or bonds, debentures,   preferred stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale   or transfer of all or any part of its assets or business, or any other corporate act or proceeding,   whether of a similar character or otherwise.  Except as otherwise provided herein, in the event of   a Corporate Change as defined in the Plan, Section 4.5 of the Plan shall be applicable.          8.    Investment Representation.  Grantee will enter into such written representations,   warranties and agreements as the Company may reasonably request in order to comply with any   federal or state securities law.  Moreover, any stock certificate for any shares of stock issued to   Grantee hereunder may contain a legend restricting their transferability as determined by the   Company in its discretion.  Grantee agrees that the Company shall not be obligated to take any   affirmative action in order to cause the issuance or transfer of shares of Stock hereunder to comply   with any law, rule or regulation that applies to the shares subject to this Agreement.          9.    No Guarantee of Employment.  This Agreement shall not confer upon Grantee   any right to continued employment with the Company or any Affiliate thereof.                                           2 

 

                                                      With Employment Agreement            10.   Withholding of Taxes.  The Company or an Affiliate shall be entitled to satisfy,   pursuant to Section 16.3 of the Plan, any and all tax withholding requirements with respect to   RSUs.          11.   General.                (a) Notices.  All notices under this Agreement shall be mailed or delivered by hand   to the parties at their respective addresses set forth beneath their signatures below or at such other   address as may be designated in writing by either of the parties to one another, or to their permitted   transferees if applicable.  Notices shall be effective upon receipt.                (b) Transferability of Award.  The rights of the Grantee pursuant to this Agreement   are not transferable by Grantee.  No right or benefit hereunder shall in any manner be liable for or   subject to any debts, contracts, liabilities, obligations or torts of Grantee or any permitted transferee  thereof. Any purported assignment, alienation, pledge, attachment, sale, transfer or other  encumbrance of the RSUs, prior to the lapse of restrictions, that does not satisfy the requirements  hereunder shall be void and unenforceable against the Company.                (c) Amendment and Termination.  No amendment, modification or termination of   this Agreement shall be made at any time without the written consent of Grantee and the Company.                (d) No Guarantee of Tax Consequences.  The Company and the Committee make   no commitment or guarantee that any federal, state, local or other tax treatment will (or will not)   apply or be available to any person eligible for compensation or benefits under this Agreement.    The Grantee has been advised and been provided the opportunity to obtain independent legal and   tax advice regarding the granting, vesting and settlement of RSUs pursuant to the Plan and this   Agreement and the disposition of any Common Stock acquired thereby.                 (e) Section 409A.  The award of RSUs hereunder is intended to either comply with   or be exempt from Section 409A, and the provisions of this Agreement shall be administered,   interpreted and construed accordingly. If the Grantee is a “specified employee” within the meaning   of Section 409A(a)(2)(B)(i) of the Code on the date on which the Grantee has a “separation from   service” (other than due to death) within the meaning of Section 1.409A-1(h) of the Treasury  Regulations, notwithstanding the provisions of this Agreement, any transfer of shares or other  compensation payable on account of Grantee’s separation from service that constitute deferred  compensation under Section 409A shall take place on the earlier of (i) the first business day  following the expiration of six months from the Grantee’s separation from service, or (ii) such  earlier date as complies with the requirements of Section 409A. To the extent required under  Section 409A, the Grantee shall be considered to have terminated employment with the Company  or its affiliates (the “Company Group”) when the Grantee incurs a “separation from service” with  respect to the Company Group within the meaning of Section 409A(a)(2)(A)(i) of the Code.                (f) Severability.  In the event that any provision of this Agreement shall be held   illegal, invalid or unenforceable for any reason, such provision shall be fully severable, but shall   not affect the remaining provisions of the Agreement, and the Agreement shall be construed and   enforced as if the illegal, invalid or unenforceable provision had not been included therein.                                           3 

 

                                                      With Employment Agreement                  (g) Supersedes Prior Agreements.  Other than the Employment Agreement, this   Agreement shall supersede and replace all prior agreements and understandings, oral or written,   between the Company and the Grantee regarding the grant of the RSUs covered hereby.                (h) Governing Law.  This Agreement shall be construed in accordance with the   laws of the State of Delaware without regard to its conflict of law provisions, to the extent federal   law does not supersede and preempt Delaware law.                (i) No Trust or Fund Created.  This Agreement shall not create or be construed to   create a trust or separate fund of any kind or a fiduciary relationship between the Company or any   Affiliate and a Grantee or any other Person.  To the extent that any Person acquires a right to   receive payments from the Company or any Affiliates pursuant to this Agreement, such right shall   be no greater than the right of any general unsecured creditor of the Company or any Affiliate.                (j) Clawback Provisions.  Notwithstanding any other provisions in this Agreement   or the Employment Agreement to the contrary, any incentive-based compensation, or any other  compensation, payable pursuant to this Agreement or any other agreement or arrangement with  the Company or an affiliate which is subject to recovery under any law, government regulation or  stock exchange listing requirement, will be subject to such deductions and clawback as may be  required to be made pursuant to such law, government regulation or stock exchange listing  requirement (or any policy adopted by the Company or an affiliate pursuant to such law,  government regulation or stock exchange listing requirement.)                (k)   Restrictive Covenants.  Grantee agrees to the restrictive covenants   contained in Exhibit C to this Agreement.                (l) Other Laws.  The Company retains the right to refuse to issue or transfer any   Stock if it determines that the issuance or transfer of such shares might violate any applicable law   or regulation or entitle the Company to recover under Section 16(b) of the Securities Exchange   Act of 1934.                (m) Binding Effect.  This Agreement shall be binding upon and inure to the benefit   of any successors to the Company and all persons lawfully claiming under the Grantee.                                           4 

 

                                                     With Employment Agreement          IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its  behalf by its duly authorized officer and Grantee has hereunto executed this Agreement as of the  date set forth above.                                   INDEPENDENCE CONTRACT DRILLING, INC.                                   By:                                                                              Name:  J. Anthony Gallegos                                  Title: President & Chief Executive Officer                                   Address for Notices:                                                                    Independence Contract Drilling, Inc.                                  20475 Hwy 249, Suite 300                                  Houston, Texas  77070                                  Attn:  General Counsel                                                                    GRANTEE                                                                                                                                                                                                                        J. Anthony Gallegos                                   Address for Notices:                                                                    Executive’s then current address shown in the                                  Company’s records.                                         5 

 

                                    Exhibit A                                 Certain Definitions.     (1)    “Change of Control” shall mean:                     (i)   the acquisition by any individual, entity or group (within the        meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as        amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning       of Rule 13d-3 promulgated under the Exchange Act) of 50 percent or more of either (A)       the then outstanding shares of common stock or membership interests of the Company (the       “Outstanding Company Common Stock”) or (B) the combined voting power of the then       outstanding voting securities of the Company entitled to vote generally in the election of       directors or managers (the “Outstanding Company Voting Securities”); provided, however,       that for purposes of this subsection A, the following acquisitions shall not constitute a       Change of Control:  (1) any acquisition directly from the Company or any acquisition by       the Company; or (2) any acquisition by any employee benefit plan (or related trust)       sponsored or maintained by the Company or any corporation controlled by the Company;       or (3) any acquisition by any corporation pursuant to a transaction that complies with       clauses (1), (2) and (3) of subsection (i) of this definition; or                    (i)   individuals, who, as of the date hereof constitute the Board (the       "Incumbent Board") cease for any reason to constitute at least a majority of the Board;       provided, however, that any individual becoming a director subsequent to the date hereof       whose election, or nomination for election by the Company’s stockholders or members,       was approved by a vote of at least a majority of the directors then comprising the Incumbent       Board shall be considered as though such individual was a member of the Incumbent       Board, but excluding, for purpose of this subsection (ii), any such individual whose initial       assumption of office occurs as a result of an actual or threatened election contest with       respect to the election or removal of directors or other actual or threatened solicitation of       proxies or consents by or on behalf of a Person other than the Board;                     (ii)  consummation of a reorganization, merger or consolidation or sale       or other disposition of all or substantially all of the assets of the Company (a "Corporate       Transaction") in each case, unless, following such Corporate Transaction, (1) all or       substantially all of the individuals and entities who were the beneficial owners,       respectively, of the Outstanding Company Common Stock and Outstanding Company       Voting Securities immediately prior to such Corporate Transaction beneficially own,       directly or indirectly, more than 60 percent of, respectively, the then outstanding shares of       common stock and the combined voting power of the then outstanding voting securities       entitled to vote generally in the election of directors, as the case may be, of the corporation       resulting from such Corporate Transaction (including, without limitation, a corporation that       as a result of such transaction owns the Company or all or substantially all of the       Company’s assets either directly or through one or more subsidiaries) in substantially the       same proportions as their ownership, immediately prior to such Corporate Transaction, of                                          6 

 

                                               With Employment Agreement                 the Outstanding Company Common Stock and the Outstanding Company Voting  Securities, as the case may be, (2) no Person (excluding any corporation resulting from  such Corporate Transaction or any employee benefit plan (or related trust) of the Company  or such corporation resulting from such Corporate Transaction) beneficially owns, directly  or indirectly, 20 percent or more of, respectively, the then outstanding shares of common  stock of the corporation resulting from such Corporate Transaction or the combined voting  power of the then outstanding voting securities of such corporation except to the extent that  such ownership existed prior to the Corporate Transaction and (3) at least a majority of the  members of the board of directors of the corporation resulting from such Corporate  Transaction were members of the Incumbent Board at the time of the execution of the  initial agreement, or of the action of the Board, providing for such Corporate Transaction;  or               (iii) approval by the stockholders of the Company of a complete  liquidation or dissolution of the Company.                                                                        7 

 

                                                     With Employment Agreement                                         Exhibit B                      Change of Control.  Notwithstanding any other provision of this Agreement to the  contrary, if, prior to termination of Grantee’s employment with Company Group, a Change of  Control occurs, then any unvested RSUs shall immediately vest upon the occurrence of the Change  of Control.                                                                    8 

 

                                                     With Employment Agreement                                         Exhibit C                                  Restrictive Covenants                                                    In consideration for the grant of RSU’s hereunder, which are expected to vest during  Grantee’s employment with the Company Group over the vesting period, as well as the  protection of the Company Group’s goodwill and Confidential Information, Grantee agrees to  the following:                (a)   Certain Definitions. For purposes of this Exhibit C, the following terms shall have  the following meanings:               (i)   “Cause” shall mean Grantee’s:                          A.     willful and continued failure to comply with the reasonable              written directives of the Company for a period of thirty (30) days after written              notice from the Company;                            B.    willful and persistent inattention to duties for a period of              thirty (30) days after written notice from the Company, or the commission of acts              within employment with the Company Group amounting to gross negligence or              willful misconduct;                           C.    misappropriation of funds or property of the Company              Group or committing any fraud against the Company Group or against any other              person or entity in the course of employment with the Company Group;                           D.    misappropriation of any corporate opportunity, or otherwise              obtaining personal profit from any transaction which is adverse to the interests of              the Company Group or to the benefits of which the Company Group is entitled;                            E.    conviction of a felony involving moral turpitude;                          F.    willful failure to comply in any material respect with the             terms of this Agreement and such non-compliance continues uncured after thirty             (30) days after written notice from the Company;                          G.     chronic substance abuse, including abuse of alcohol, drugs              or other substances or use of illegal narcotics or substances, for which Grantee fails              to undertake treatment immediately after requested by the Company or to complete              such treatment and which abuse continues or resumes after such treatment period,              or possession of illegal narcotics or substances on Company premises or while              performing Grantee’s duties and responsibilities.         For purposes of this definition, no act, or failure to act, by Grantee will be considered        “willful” if done, or omitted to be done, by Grantee in good faith and in the reasonable        belief that the act or omission was in the best interest of the Company or required by        applicable law.                                          9 

 

                                                     With Employment Agreement          Any termination during the Employment Term by the Company for Cause shall be        communicated by Notice of Termination to the Grantee.  For purposes of this Agreement,        a “Notice of Termination” means a written notice which sets forth in reasonable detail the        facts and circumstances claimed to provide a basis for termination of the Grantee’s        employment for “Cause”   The failure by the Company to set forth in the Notice of        Termination any fact or circumstance which contributes to a showing of Cause shall not        waive any right of the Company from asserting such fact or circumstance in enforcing the        Company’s rights hereunder.                 (ii)  “Confidential Information” means any information, knowledge or data of        any nature and in any form (including information that is electronically transmitted or        stored on any form of magnetic or electronic storage media) relating to the past, current or        prospective business or operations of the Company Group, that is not generally known to        persons engaged in a business similar to that conducted by the Company Group, whether        produced by the Company Group or any of its consultants, agents or independent        contractors or by Grantee, and whether or not marked confidential.   Confidential        information does not include information that (1) at the time of disclosure is, or thereafter        becomes, generally available to the public, (2) prior to or at the time of disclosure was        already in the possession of Grantee, (3) is obtained by Grantee from a third party not in        violation of any contractual, legal or fiduciary obligation to the Company Group with        respect to that information or (3) is independently developed by Grantee, but not including        the confidential information provided by the Company Group.               (iii) “Restricted Business” means any the oil and natural gas land contract        drilling business conducted in the United States of America.           (b)   Nondisclosure of Confidential Information.  Grantee shall hold in a fiduciary  capacity for the benefit of the Company Group all Confidential Information which shall have been  obtained by Grantee during Grantee’s employment and shall not use such Confidential Information  other than within the scope of Grantee’s employment with and for the exclusive benefit of the  Company Group.  Following any termination of employment with the Company Group, Grantee  agrees (i) not to communicate, divulge or make available to any person or entity (other than the  Company Group) any such Confidential Information, except (A) upon the prior written  authorization of the Company Group, (B) as may be required by law or legal process, (C) as  reasonably necessary in connection with the enforcement of any right or remedy related to this  Agreement, or (D) unless no longer Confidential Information, and (ii) to deliver promptly to the  Company Group any Confidential Information in Grantee’s possession, including any duplicates  thereof and any notes or other records Grantee has prepared with respect thereto. In the event that  the provisions of any applicable law or the order of any court would require Grantee to disclose or  otherwise make available any Confidential Information then Grantee shall, to the extent  practicable, give the Company prior written notice of such required disclosure and an opportunity  to contest the requirement of such disclosure or apply for a protective order with respect to such  Confidential Information by appropriate proceedings.            (c)   Limited Covenant Not to Compete.  In the event Grantee’s employment is  terminated by Grantee for any reason or by the Company Group for Cause, Grantee agrees that                                          10 

 

                                                      With Employment Agreement      during the period beginning on the date of such termination and ending on the twelve (12) month   anniversary of the date of such termination:                  (i)   Grantee shall not, directly or indirectly, for himself or others, own, manage,         operate, control or participate in the ownership, management, operation or control of any         business, whether in corporate, proprietorship or partnership form or otherwise, that is         engaged, directly or indirectly, in the United States in the Restricted Business; provided,         however, that the restrictions contained herein shall not restrict (A) the acquisition by         Grantee of less than 2% of the outstanding capital stock of any publicly traded company         engaged in a Restricted Business or (B) Grantee from being employed by an entity in which         the majority of such entity’s revenues on a consolidated basis determined in accordance         with generally accepted accounting principles are from activities and businesses that do         not constitute a Restricted Business and provided that Grantee is only employed by and         engaged with divisions and units of such entity that are not engaged in the Restricted         Business; and                (ii)  Grantee shall not, directly or indirectly (A) solicit any individual, who, at         the time of time of such solicitation is an employee of the Company Group, to leave such         employment or hire, employ or otherwise engage any such individual (other than         employees of the Company Group who respond to general advertisements for employment        in newspapers or other periodicals of general circulation (including trade journals)), or        (B) cause, induce or encourage any material actual or prospective client, customer,        supplier, landlord, lessor or licensor of the Company Group to terminate or modify any        such actual or prospective contractual relationship that exists on the date of termination of        employment.     For purposes of clarity, it is understood that the provisions of this paragraph C are not applicable  if Grantee’s employment with the Company Group is terminated by the Company Group without  Cause.   In addition, it is understood that the provisions of this paragraph C shall terminate in all  respects on the fourth anniversary of the date of the Agreement to which this Exhibit C is a  part.          (d)   Injunctive Relief; Remedies.  The covenants and undertakings contained in this   Exhibit C relate to matters which are of a special, unique and extraordinary character and a   violation of any of the terms of this Exhibit C will cause irreparable injury to the Company Group,   the amount of which will be impossible to estimate or determine and which cannot be adequately   compensated.  Accordingly, the remedy at law for any breach of this Exhibit C may be inadequate.    Therefore, notwithstanding anything to the contrary, the Company will be entitled to an injunction,   restraining order or other equitable relief from any court of competent jurisdiction in the event of   any breach of any provision of this Exhibit C without the necessity of proving actual damages or   posting any bond whatsoever.  The rights and remedies provided by this Exhibit C are cumulative   and in addition to any other rights and remedies which the Company Group may have hereunder   or at law or in equity.  The parties hereto further agree that, if any court of competent jurisdiction   in a final nonappealable judgment determines that a time period, a specified business limitation or   any other relevant feature of this Exhibit C is unreasonable, arbitrary or against public policy, then                                           11 

 

                                                     With Employment Agreement    a lesser time period, geographical area, business limitation or other relevant feature which is  determined by such court to be reasonable, not arbitrary and not against public policy may be  enforced against the applicable party.           (e)   Governing Law of this Exhibit C; Consent to Jurisdiction. Any dispute regarding  the reasonableness of the covenants and agreements set forth in this Exhibit C, or the territorial  scope or duration thereof, or the remedies available to the Company upon any breach of such  covenants and agreements, shall be governed by and interpreted in accordance with the laws of the  state of Texas, without regard to conflict of law provisions thereof, and, with respect to each such  dispute, the Company and Grantee each hereby irrevocably consent to the exclusive jurisdiction  of the State of Texas for resolution of such dispute, and further agree that service of process may  be made upon Grantee in any legal proceeding relating to this Exhibit C by any means allowed  under the laws of such state.          (f)   Grantee’s Understanding of this Section.  Grantee hereby represents to the  Company that Grantee has read and understands, and agrees to be bound by, the terms of this  Exhibit C. Grantee acknowledges that the geographic scope and duration of the covenants  contained in Exhibit C are the result of arm’s-length bargaining and are fair and reasonable in light  of (i) the importance of the functions performed by Grantee and the length of time it would take  the Company Group to find and train a suitable replacement, (ii) the nature and wide geographic  scope of the operations of the Company Group, (iii) Grantee’s level of control over and contact  with the Company Group’s business and operations in all jurisdictions where they are located, and  (iv) the fact that the Restricted Business is potentially conducted throughout the geographic area  where competition is restricted by this Agreement. It is the desire and intent of the parties that the  provisions of this Agreement be enforced to the fullest extent permitted under applicable law,  whether now or hereafter in effect and therefore, to the extent permitted by applicable law, the  parties hereto waive any provision of applicable law that would render any provision of this Exhibit  C invalid or unenforceable.                                                   12

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