Document:

a50564955ex10_17.htm

Exhibit 10.17

 

NIC INC. 2006 AMENDED AND RESTATED

STOCK OPTION AND INCENTIVE PLAN

 

[Year] Performance-Based Restricted Stock Agreement

 

The Company seeks to provide a means by which the Company, through the grant of the Shares to Grantee, may retain Grantee's services and motivate Grantee to exert his or her best efforts on behalf of the Company and any Affiliate;

 

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties agree as follows:

 

1. Grant of Performance-Based Restricted Stock.  NIC Inc., a Delaware corporation (the "Company"), hereby promises to grant to [executive name] ("Grantee"), as of [date] (the "Grant Date") [number] shares of the Company's $0.0001 par value Common Stock (the "Shares"), subject to the restrictions, terms, conditions and other provisions of this Performance-Based Restricted Stock Agreement (the "Agreement") and of the NIC Inc. 2006 Amended and Restated Stock Option and Incentive Plan (the "Plan"), which restrictions, terms, conditions and other provisions are incorporated herein by this reference.  Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Agreement.

 

The actual number of Shares, if any, (subject to any adjustment to the number of Shares as provided in Section 3 hereof, and as will be reflected by delivery of Share certificates or registered as book entry shares with the Company's transfer agent) that will be delivered pursuant to this Agreement is dependent upon the level of achievement of the performance goals set forth in Exhibit A (the "Performance Goals") during the period from January 1, [year] through December 31, [year] (the "Performance Period") and the compliance with all terms and conditions set forth in this Agreement and the Plan.

 

2. Restrictions and Forfeiture

 

If Grantee's Continuous Status as an Employee, Director or Consultant terminates for any reason other than death or disability (as disability is defined in Internal Revenue Code Section 22(e)(3)) or following a Control Change as provided for in Section 4(b), Grantee shall forfeit all rights to receive any undelivered Shares under this Agreement.  Grantee's right to receive any undelivered Shares will also be forfeited if the Committee determines that Grantee engaged in misconduct in connection with his or her employment with NIC.

 

From the date of this Agreement and until a Share is delivered to Grantee, Grantee shall have no rights to sell, assign, exchange, transfer, pledge, hypothecate or otherwise encumber any right he or she may have to receive such Share under this Agreement.

 

3. Acceleration of Payment of Shares on Death or Disability.

 

If Grantee's Continuous Status as an Employee, Director or Consultant terminates due to his or her death or disability, Grantee shall receive a pro rata portion of the Shares eligible to be received under this Agreement.  The pro rata portion will be determined by calculating the product of (a) the total number of Shares Grantee would have received if his or her employment had not terminated and based on the ultimate level of achievement toward the Performance Goals at the end of the Performance Period multiplied by (b) a fraction, the numerator of which is the number of full and partial months of employment Grantee completed after the Grant Date and the denominator is [thirty-six (36)].  For the avoidance of doubt, unless otherwise determined by the Committee in its sole discretion, in no event will any Shares be paid on account of Grantee's death or disability if the Performance Goals are achieved at a level less than Threshold.

 

  

  

  

 

4. Terms and Conditions.

 

(a) Adjustments in Event of Change in Common Stock.  If any change is made in the Shares, without the receipt of consideration by the Company (through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, stock split, liquidating dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the Company), the number of Shares eligible to be paid pursuant to the terms and conditions of this Agreement (including any Dividend Shares credited to Grantee's account in accordance with Section 4(c)) will be appropriately adjusted in the class(es) and number of shares and price per share of stock of those subject Shares in such manner as the Board may deem equitable to prevent substantial dilution or enlargement of the rights granted to Grantee; provided, however, that no such adjustment shall cause the Company to issue a fractional share.  Such adjustments shall be final, binding and conclusive.  (The conversion of any convertible securities of the Company shall not be treated as a transaction not involving the receipt of consideration by the Company.)

 

(b) Sale of the Company.  In the event of a dissolution, liquidation or sale of all or substantially all of the assets of the Company, or a transaction following which the Company is not the surviving corporation in any merger, consolidation, or reorganization (a "Control Change"), then all or a portion of the number of the Shares eligible to be delivered pursuant to this Agreement shall be delivered in accordance with the following:

 

(i) If the Control Change occurs on or prior to the first anniversary of the Grant Date and this Agreement is not assumed, converted, or replaced by the continuing entity, Grantee shall be paid immediately before the Control Change a number of Shares equal to that number of Shares Grantee would have been paid if each of the Performance Goals was achieved at the "Target" level.

 

(ii) If the Control Change occurs after the first anniversary of the Grant Date and this Agreement is not assumed, converted, or replaced by the continuing entity, Grantee shall be paid immediately before the Control Change a number of Shares based on the actual performance of the Company as if the Performance Period ended on December 31 immediately preceding the date, on which the Control Change occurs, with appropriate adjustments, if necessary to reflect such shortened Performance Period.

 

  

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(iii) If the Control Change occurs on or before the first anniversary of the Grant Date and this Agreement is assumed by the continuing entity, Grantee shall be paid at the end of the Performance Period the same number of Shares Grantee would have been paid if each of the Performance Goals was achieved at the "Target" level, subject to Grantee's Continuous Status as an Employee, Director or Consultant through the end of the Performance Period.

 

(iv) If the Control Change occurs after the first anniversary of the Grant Date and this Agreement is assumed by the continuing entity, Grantee shall be paid at the end of the Performance Period the same number of Shares based on the actual performance of the Company as if the Performance Period ended on December 31 immediately preceding the date on which the Control Change occurs, subject to Grantee's Continuous Status as an Employee, Director or Consultant through the end of the Performance Period with appropriate adjustments, if necessary, to reflect such shortened Performance Period.

 

Notwithstanding the provisions of clause (iii) and (iv) to the contrary, if, during the remaining portion of the applicable Performance Period for the applicable award and following the Control Change, (A) Grantee's Continuous Status as an Employee, Director or Consultant is terminated by the Company other than for cause or, (B) if Grantee is a participant in an arrangement or covered by an employment agreement that provides for certain rights upon Grantee's resignation with "good reason" and Grantee resigns for such a "good reason", then, to the extent not then-vested, Grantee shall be paid upon his or her termination of employment the number of Shares that would have been paid under (iii) or (iv) as applicable.

 

If this Agreement is assumed in connection with a Control Change transaction, then the Board shall equitably and proportionately adjust the number of Shares and the kind of Shares or securities covered by this Agreement immediately after such transaction solely as necessary to preserve (but not increase) the level of incentives intended by this Agreement.

 

This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part of its business or assets.

 

(c) Dividend Shares.  Provided this Agreement has not otherwise been terminated or any of Grantee's rights to receive Shares have not been forfeited, Grantee shall be entitled to receive dividend equivalent accruals on the Shares for any cash dividends declared before any Shares are paid under this Agreement.  At the end of the Performance Period or at any other time Grantee becomes entitled to receive the payment of Shares hereunder, Grantee shall receive an additional number of Shares ("Dividend Shares") determined as follows: (1) as of each date (the "Dividend Payment Date") that the Company would otherwise pay a declared cash dividend on the total number of Shares set forth in Section 1 if such Shares were outstanding, the Company will credit a number of Dividend Shares to a notional account established for the benefit of Grantee.  The number of Dividend Shares so credited will be calculated by dividing the amount of such hypothetical cash dividend payment by the Fair Market Value of the Company's common stock on the Dividend Payment Date (rounded down to the nearest whole Dividend Share); and (2) on the date some or all of the Shares are paid under this Agreement, the total number of Dividend Shares credited to Grantee's notional account will be converted into an equivalent number of Shares and paid to Grantee.

 

  

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(d) No Rights as a Shareholder.  Each Share potentially eligible to be delivered pursuant to this Agreement is not considered issued or outstanding until an actual delivery of the Share has been made.  Accordingly, until such Share has been delivered to Grantee pursuant to the terms of this Agreement, Grantee shall have no rights and privileges as a shareholder of the Company with respect to such Share, including no right to vote or receive dividends paid on any Shares.  Notwithstanding the foregoing sentence, Grantee is entitled to receive Dividend Shares as provided above in Section 4(c).

 

(e) No Rights to Continued Relationship.  Grantee's right to receive any Shares under this Agreement shall not confer upon Grantee any right with respect to continuance of employment by the Company or by an Affiliate, nor shall it interfere in any way with the right of his or her employer to terminate his or her employment at any time.

 

Grantee's right to receive any Shares hereunder shall not confer upon Grantee any right with respect to continuance of a directorship of the Company or of an Affiliate, nor shall it interfere in any way with the right of the shareholders to remove him or her as a director at any time.

 

Grantee's right to receive any Shares hereunder shall not confer upon Grantee any right with respect to continuance of any consulting arrangement with the Company or any Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate, as the case may be, to terminate any such arrangement.

 

(f) Compliance with Other Laws and Regulations.  This Agreement and the obligation of the Company to sell and deliver Shares hereunder, shall be subject to all applicable federal and state laws, rules, and regulations, and to such approvals by any government or regulatory agency as may be required.  The Company shall not be required to issue or deliver any certificates for Shares prior to the completion of any registration or qualification of such Shares under any federal or state law, or any rule or regulation of any governmental body which the Company shall, in its sole discretion, determine to be necessary or advisable; provided, however, the Company shall use reasonable efforts to cause such issuance or delivery to comply with all such laws and rules as promptly as practicable.

 

To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code.  This Agreement and the Plan shall be administered in a manner consistent with this intent, and any provision that would cause this Agreement or the Plan to fail to satisfy Section 409A of the Code shall have no force or effect until amended to comply with Section 409A of the Code (which amendment may be retroactive to the extent permitted by Section 409A of the Code and may be made by the Company without the consent of Grantee).

 

  

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(g) Withholding Taxes. Grantee agrees to make appropriate arrangements with the Company or Affiliate, as the case may be, for the satisfaction of all federal, state and local income and employment tax withholding requirements applicable to the delivery of any Shares.  No certificates representing Shares will be delivered until Grantee has made acceptable arrangements for these withholding requirements.  Grantee may elect to pay all minimum required amounts of tax withholding, or any part thereof, by electing to transfer to the Company, or have withheld from any Shares otherwise eligible to be delivered under this Agreement, Shares having a value equal to the minimum amount required to be withheld under federal, state or local law or such lesser amount as may be elected by Grantee. The value of Shares to be transferred to the Company shall be the fair market value of the Shares on the date that the amount of tax to be withheld is to be determined (the "Tax Date"), as determined by the Company. Any such elections by Grantee to have Shares withheld for this purpose will be subject to the following restrictions:

 

(i) All elections must be made prior to the Tax Date;

 

(ii) All elections shall be irrevocable; and

 

(iii) If Grantee is an officer or director of the Company within the meaning of Section 16 of the Securities Exchange Act of 1934 ("Section 16"), Grantee must satisfy the requirements of such Section 16 and any applicable rules thereunder with respect to the use of Common Stock to satisfy such tax withholding obligation.

 

5. Investment Representation.  The Company may require that Grantee furnish to the Company, as a condition of acquiring stock hereunder, (a) written assurances satisfactory to the Company, or counsel for the Company, as to Grantee's knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory to the Company, or counsel for the Company, who is knowledgeable and experienced in financial and business matters, and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of acquiring the Shares; and (b) written assurances satisfactory to the Company, or counsel for the Company, stating that Grantee is acquiring the stock for Grantee's own account and not with any present intention of selling or otherwise distributing the stock.  The Company may (a) restrict the transferability of the stock and require a legend to be endorsed on the certificates representing such stock, as appropriate to reflect resale restrictions, if any, imposed by the Board or as appropriate to comply with any applicable state or federal securities laws, rules or regulations; and (b) condition the issuance and delivery of stock upon the listing, registration or qualification of such stock upon a securities exchange or quotation system or under applicable securities laws.  The Company will use reasonable efforts to cause such issuance and delivery to be in compliance with all applicable listing, registration or qualification requirements or applicable exception therefrom as promptly as practicable following Grantee's entitlement to the shares.  The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if (a) the issuance of stock has been registered under a then currently effective registration statement under the Securities Act, or (b) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met in the circumstances under the then applicable securities laws.

 

  

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6. Grantee Bound by the Plan.  Grantee agrees to be bound by all the terms and provisions of the Plan.  To the extent that the terms of this Agreement are inconsistent with the terms of the Plan, the terms of the Plan shall govern.  The captions used in this Agreement, and the Plan are inserted for convenience and shall not be deemed a part of the Agreement for construction or interpretation.

 

7. Governing Law.  This Agreement and the Plan shall be construed in accordance with the laws of the State of Delaware, without regard to the conflict of laws principles.

 

8. Notices.  Any notice to the Company or the Board that is required to be made under the terms of the Agreement or under the terms of the Plan shall be addressed to the Company in care of its Compensation Committee Chairman at 25501 West Valley Parkway, Suite 300, Olathe, Kansas 66061 with a copy to its General Counsel at the same address.  Any notice that is required to be made to Grantee under the terms of the Agreement or under the terms of the Plan shall be addressed to him or her at the address indicated below:

 

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

 

unless Grantee notifies the Company of his or her address change in writing as provided in this Section 8 in which case the notice shall be addressed to Grantee at his or her new address.  A notice under this Section 8 shall be deemed to have been given or delivered upon personal delivery or upon deposit in the United States mail, by registered or certified mail, postage prepaid and properly addressed as provided in this Section 8.

 

This Agreement has been executed and delivered by the parties hereto effective date above written.

 

	  	
NIC, INC.

	 	 	 	 
	 	 	 	 
	 	By:	 	 
	 	Name:	 	 
	 	Title:	 	 
	 	 	 	 
	  	
GRANTEE

	 	 	 	 
	 	 	 	 

 

  

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Exhibit A

 

Performance Goals

 

The total number of Shares granted under this Award that will ultimately be delivered to Grantee based on the achievement of the established performance goals will depend on the Company's consolidated financial performance with respect to each of the following three measures for the Performance Period:

 

	
●  

	
Operating income growth (three-year compound annual growth rate) – [__%] weighting

 

	
●  

	
Total revenue growth (three-year compound annual growth rate) – [__%] weighting

 

	
●  

	
Cash flow return on invested capital (three-year average) – excluding taxes paid – [__%] weighting

 

Each of these metrics is defined as follows:

 

The definition of Operating Income is consistent with that term defined in generally accepted accounting principles and will be derived from the face of the consolidated statements of income included in the Company’s Annual Reports on Form 10-K for the respective fiscal years.

 

The definition of Total Revenue is consistent with that term defined in generally accepted accounting principles and will be derived directly from the face of the consolidated statements of income included in the Company’s Annual Reports on Form 10-K for the respective fiscal years.

 

Cash Flow Return on Invested Capital is defined as consolidated cash flow from operating activities plus income taxes paid minus capital expenditures, the difference of which is divided by the difference between total assets and non-interest bearing current liabilities.  Consolidated cash flow from operating activities and capital expenditures will be derived from the face of the consolidated statements of cash flows included in the Company’s Annual Report on Form 10-K for the respective fiscal years.  Total assets and non-interest bearing liabilities will be derived from the face of the consolidated balance sheets included in the Company’s Annual Reports on Form 10-K for the respective fiscal years.

 

Calculation of Deliverable Shares

 

At the end of the Performance Period, the Company will deliver a number of Shares based on a pre-defined schedule of Threshold, Target and Superior Company performance.  The Threshold, Target and Superior Performance Goals for each of the three measures above have been established by the Committee and are set forth in the table immediately below.

 

  

  

  

 

	  	
Performance Goals

	 
	  	
Threshold

	
Target

	
Superior

	 
	
Operating income growth

	
[__%]

	
[__%]

	
[__%]

	 
	 	 	 	 	 
	
Total revenue growth

	
[__%]

	
[__%]

	
[__%]

	 
	 	 	 	 	 
	
Cash flow return on invested capital – excluding taxes

	
[__%]

	
[__%]

	
[__%]

	 

 

The total number of Shares granted in Section 1 of this Agreement was determined based on the quotient of [___%] of the Grantee's base salary (on the Grant Date) divided by the market value of one Share on the Grant Date.  Accordingly, only if all Performance Goals are achieved at the Superior level will the total number of Shares be delivered.

 

If less than Superior performance is obtained for each of the three Performance Goals, then the number of Shares to be delivered at the end of the Performance Period will be the quotient obtained by dividing (a) the product of (1) the Grantee's base salary as of the Grant Date times (2) the weighted percentages of [__%], [___%] or [___%] for Company performance at Threshold, Target or Superior levels, respectively by (b) the fair market value of one Share on the Grant Date.  For each performance measure, the weighted percentage will be 0% if Threshold performance is not achieved for that Performance Goal, and no additional shares will be awarded for performance in excess of the Superior level.  For amounts between the Threshold and Target levels or between the Target and Superior levels, straight line interpolation, rounded up to the next whole share, will be used to determine the number of Shares that is to be delivered.  However, the overall maximum number of Shares to be delivered at the end of the Performance Period will be the quotient obtained by dividing (a) the product of (1) the Grantee's base salary as of the Grant Date times (2) [___%] ([X] times Target) by (b) the fair market value of one Share on the Grant Date, rounded up to the next whole share.a50564955ex10_24.htm

Exhibit 10.24

NIC Sales Commission Bonus Plan

Senior Vice President of Business Development

(as amended on February 5, 2013)

Objective

The objective of any NIC  Sales Commission Bonus Plan, including this one (the "Plan"), is to fairly compensate employees who contribute significantly to securing significant profitable  contracts (“Contract”) that advance NIC's growth.

 

General Parameters

The Plan generally provides that NIC Inc. (the "Company" or "NIC") will pay commission bonuses based upon a percentage of the operating income earned under a Contract over the initial term (not including renewal options), subject to the terms and conditions of this Plan and the terms and conditions established hereunder relating to each such Contract.  Due to the potential for significant variance in Contract values and financial risk, NIC, in its sole discretion, may establish a minimum total commission bonus or maximum total commission bonus that may be paid for any specific Contract opportunity.

 

Plan Term

The Plan covers new Contracts closed on or after September 12, 2012.

 

Plan Participants

The Chief Executive Officer ("CEO") will make a recommendation to the Compensation Committee of the Board of Directors, as to whether the Senior Vice President of Business Development ("SVP") may be considered for commission bonus payments under the Plan. The determination of the specific percentage of Contract operating income commission bonus recommendation for each Contract is at the discretion of the CEO and the actual percentage is at the discretion of the Compensation Committee.

 

Determination of Operating Income

Operating income will be determined in accordance with standard NIC accounting policy and is equal to the amount reported monthly in the standard NIC financial statements.  The initial estimate of Contract operating income will be mutually agreed to among the Finance, Sales and Operations divisions.  Disputes regarding the initial estimate of Contract operating income will be escalated to the CEO for final determination. The CEO's determination will be final and binding.

 

Approval by Compensation Committee of the Board of Directors

The CEO will present the recommendation for SVP commission bonus payments to the NIC Board’s Compensation Committee no later than the next regularly scheduled meeting following the collection of the initial month’s primary funding source revenues for the respective Contract, for approval.

 

Timing of Commission Bonus Payments

Except as otherwise provided herein, the timing of commission bonus payments shall be as set forth in this section. 50% of the total estimated commission bonus from the first three years of the Contract will be paid within 30 days following Compensation Committee approval.  The remaining 50% of the commission bonus from the first three years of the Contract will be divided into three payments as follows:

 

  

  

  

 

First anniversary date of initial commission bonus payment – 20%

Second anniversary date – 20%

Third anniversary date – 10%

 

Commission bonus payments will be adjusted at least annually based on actual financial results and updated financial forecasts.   If the initial term of the Contract is longer than three years, the commission bonus for the remaining term of the Contract will be paid on each successive anniversary date. The SVP must be employed by NIC on each payment date to receive payment.

 

Discretionary Payment

NIC, in its sole discretion, reserves the right to administer, interpret, modify, or cancel, at any time, any element of the Plan including, but not limited to bonuses, commissions, or incentive factors or objectives as set forth in this document.  For example, given the risk profile of the particular opportunity, NIC may fix the amount of the total commission bonus, or may reduce the percentage payout of the initial commission bonus payment or subsequent commission bonus payments. The CEO and Compensation Committee may establish additional terms and conditions applicable to each Contract in their sole discretion.

 

No incentive will be considered as compensation under any employee benefit plan of NIC, except as may be otherwise provided in such employee benefit plan or by law.

 

No commission bonus will be paid if the SVP does not follow sales policies, procedures or processes, develops an unsatisfactory working relationship with the prospect or customer, or is no longer employed by NIC at the time a commission bonus payment is scheduled to be made.

 

No portion of a commission bonus will be considered earned until the Contract is properly signed and the initial month’s revenues from the primary funding source have been collected by NIC.

 

Additional Terms

No Effect on Separate Employment Agreement. The SVP currently has a written Key Employee Agreement dated Feb. 5, 2013 (the "Agreement"), which was approved by the Compensation Committee and signed by the CEO.  This Plan is supplemental to that Agreement and does not in itself constitute any type of employment contract, either expressed or implied.  Nothing contained in the Plan will give the SVP rights in addition to those in the Agreement to be retained in the employment of the Company nor is this Plan intended to affect the right of the Company to terminate SVP pursuant to the Agreement.

 

Dispute Resolution.  Disagreements or disputes between NIC and the SVP arising out of or relating to interpretation of the Plan shall be submitted to the CEO (or designate) for resolution. The CEO (or designate) shall decide the issue in his or her sole discretion. Such decision will be final and binding.

 

  

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Other Commission Bonuses.  Commission bonuses for Contracts that are not identified within this Plan will be administered at the sole discretion of the CEO, with approval by the Compensation Committee.

 

Amendment and Termination.  The Plan may be amended or discontinued by the Compensation Committee at any time without prior notification to participants.  However, no amendment may adversely affect commission bonuses under the Plan with respect to a Contract after the collection of the initial month’s primary funding source revenues for the respective Contract, except as expressly provided herein.

 

Adjustment.  The Compensation Committee maintains sole discretion to adjust commission bonuses under the Plan downward for legitimate and reasonable performance reasons. The Compensation Committee will, to the extent permitted by law, have the sole and absolute authority to make retroactive adjustments to any commission bonus paid to participants where the payment was predicated upon the achievement of erroneous financial or strategic business results, or where the participant engaged in intentional misconduct that increased his/her commission bonus. Where applicable, NIC may seek to recover any amount determined to have been inappropriately received by a participant under the Plan.

 

Compliance.  The Compensation Committee may obtain such agreements or undertakings, if any, as the Compensation Committee may deem necessary or advisable to assure compliance with any law or regulation of any governmental authority.  The Plan and any commission bonus award made hereunder shall be subject to all applicable federal and state laws, rules and regulations, and to such approvals by any government or regulatory agency as may be required.

 

Limitation on Liability.  No member of the Board or Compensation Committee, nor any officer or employee of NIC acting on behalf of the Board or Compensation Committee, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan.

 

Rights under Plan.  The interests of participants under the Plan are not subject to claims, indebtedness, attachment, execution, garnishment, or other legal or equitable process.  Participant interests under the Plan may not be transferred or assigned, other than by will or by the laws of descent and distribution.  If the Participant attempts to alienate, assign, pledge, hypothecate, or otherwise dispose of commission bonus awards or other rights under the Plan, except as provided for in this Plan, or in the event of any levy, attachment, execution, or similar process upon the right or interest conferred by this Plan, the Board may terminate the participant’s commission bonus awards and rights by notice to the participant, and it shall thereupon become null and void.

 

Clawback.  By participating in the Plan, each participant is deemed to have acknowledged that any amount paid pursuant to the Plan may be subject to certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) that will require the Company to recover certain amounts of commission bonuses paid to certain executive officers by reason of any element by which the commission bonus is determined under this plan that becomes involved in an accounting restatement, if the Company is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirements under any applicable securities laws.  By participating in the Plan, each participant agrees and consents to any forfeiture or required recovery or reimbursement obligations of the Company with respect to any compensation paid that is forfeitable or recoverable by the Company pursuant to Dodd-Frank and in accordance with any Company policies and procedures adopted by the Committee in order to comply with Dodd Frank, as the same may be amended from time to time.

 

  

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Ethical and Legal Standard

	
  

	
1.

	
No employee may pay, offer to pay or give any of their incentive compensation or any other money to any agent, customer or representative of the customer or any other person as an inducement or reward for assistance in making a sale.

 

	
  

	
2.

	
Gifts and entertainment above a nominal amount shall not be given to customers, agents or representatives except in accordance with current NIC's policies and procedures.

 

	
  

	
3.

	
No NIC employee shall enter into any understanding, agreement, plan or scheme, express or implied, formal or informal, with any competitor in regard to prices, terms, or conditions of sales, distribution, territories or customers, nor engage in any other conduct which in the opinion of NIC's legal counsel creates any violations of any municipal, state or federal law or regulation or is contrary to any NIC policy.

 

	
  

	
4.

	
Any failure to adhere to NIC's ethical and legal standards or of other generally recognized ethical and legal business standards will subject an employee to revocation of any commission bonus paid in the past or potentially payable in the future, or of other compensation as provided by this or any other agreement to which the employee might otherwise be entitled. In addition, any such infraction will subject the employee to disciplinary action, up to and including termination.

 

Confidentiality.  This agreement is deemed confidential to the Company, except as otherwise required by law.

 

 

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