Document:

EXHIBIT 10.2

 

Portions of this document have been redacted pursuant to a Request for Confidential Treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. Redacted portions are indicated with the notation “***”.

 

 

 

DISTRIBUTION AGREEMENT

 

This agreement (“Agreement”) dated as of November 13, 2014 (“Effective Date”) is made by and between CÜR Media, Inc. a Delaware corporation with offices at 2217 New London Turnpike, South Glastonbury, CT 06073 (“Company” or “CÜR”), and MusicNet, Inc., d/b/a MediaNet Digital, Inc. a Delaware corporation with its principal offices at 2401 Elliott Avenue, Suite 300, Seattle, WA 98121 (“MediaNet”).

 

WHEREAS, MediaNet owns and operates the MediaNet Service (as defined below), which enables the digital transmission of Sound Recordings;

 

WHEREAS, Company owns and operates the web portal located at www.curmusic.com and sub-domains thereof and Company-branded applications for use on mobile and other hardware devices (“Company Application”);

 

 WHEREAS, MediaNet wishes to provide the MediaNet Service (as defined below) to Company, and Company wishes to receive the MediaNet Service so that it may make the Company Service (as defined below) accessible to users of the Company Application pursuant to the terms and conditions set forth herein;

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1. Definitions

 

1.1 “Beta Period“ has the meaning set forth on Exhibit A.

 

1.2 “Breach Notice” has the meaning set forth in Section 8.2.

 

1.3 “Clearances” mean any and all applicable rights, clearances, consents, licenses and permissions that are necessary for the provision of Sound Recordings (including the associated Core Metadata) and the underlying musical works through the Company Service as set forth herein, and for Company to receive the Sound Recordings and the underlying musical works from MediaNet, subject to third party restrictions.

 

1.4 “Coding Fees” mean the fees payable to licensors of digital media encoding and decoding technologies.

 

1.5 “Company Application” has the meaning set forth in the preamble.

 

1.6 “Company Marks” means the trade names, logos, trademarks and service marks provided by Company, directly or indirectly, to MediaNet for use hereunder including, without limitation, any icons.

 

	 
	
Page 1 of 22

	

 

1.7 “Company Materials” means, collectively, any content, links, marks, functionality, technology, websites, modules, and/or other information, technology and materials owned, operated, marketed, provided by, licensed and/or distributed by Company, including, without limitation, all Company related patents, patent rights, trademarks, service marks, copyrights, works of authorship, trade secrets and other proprietary interests. For the avoidance of doubt, the rights in and to the Sound Recordings and the underlying musical works (as distinguished from the tangible and personal property rights) will be provided by Company as set forth herein and be deemed Company Materials hereunder.

 

1.8 “Company Service” means the Company Materials and the MediaNet Service as each are further described herein, which together enable a digital music content service to be provided by Company to End Users, which will enable End Users to engage in the Streaming of Sound Recordings.

 

1.9 “Company Usage Report” has the meaning set forth in Section 4.7.

 

1.10 “Confidential Information” has the meaning set forth in Section 11.1.

 

1.11 “Content Guide Data” means third party and/or MediaNet data relating to music and artists, in addition to the Core Metadata, as further set forth on Exhibit B.

 

1.12 “Content Guide Data Feed” has the meaning set forth in Section 2.2(e).

 

1.13 “Content Supplier” means a party that owns, controls and/or licenses rights related to the content provided to Company hereunder, including, without limitation, record companies and music publishers.

 

1.14 “Content Supplier Agreement” means a license with the owner or controller of a Sound Recording and/or musical work, whether voluntary, compulsory/statutory or otherwise, whereby such third party confers upon Company or MediaNet, as the case may be, the authority to make available Sound Recordings, musical works and/or applicable Core Metadata to End Users through the Company Service, including, without limitation, agreements with record labels, music publishers and performing rights organizations.

 

1.15 “Content Supplier Costs” means the sum of the cost of the Sound Recordings, including the underlying musical works, charged by or due to the Content Suppliers, including, without limitation, amounts charged by record labels, music publishers and performing rights organizations.

 

1.16 “Core Metadata” means the data utilized to identify a particular Sound Recording as further set forth on Exhibit B.

 

1.17 “Core Metadata Feed” has the meaning set forth in Section 2.2(d).

 

1.18 “Effective Date” has the meaning set forth in the Preamble.

 

1.19 “End User” means any user of the Company Service.

 

1.20 “End User Agreement” means a click-through agreement, or comparable agreement, which, if required by a Content Supplier Agreement, an End User must expressly accept prior to accessing any content from the Company Service, which has been or will be drafted by Company, which may be incorporated into existing terms of service governing the Company Application and will comply with all requirements forth in the Content Supplier Agreements.

 

1.21 “Equipment” means any computer hardware, software, and telecommunications or other equipment used by MediaNet in encoding, hosting, maintaining, operating, servicing, updating and making the MediaNet Service available to Company.

 

1.22 “Force Majeure Event” has the meaning set forth in Section 13.2.

 

	 
	
Page 2 of 22

	

 

1.23 “Images” means all images made available to Company as part of the Content Guide Data, including, without limitation, artist images.

 

1.24 “Initial Term” has the meaning set forth in Section 8.1.

 

1.25 “Launch Date” has the meaning set forth in Section 2.5.

 

1.26 “MediaNet Fees” means all amounts due to MediaNet by Company pursuant to this Agreement, including, without limitation, ***, but excluding the Content Supplier Costs.

 

1.27 “MediaNet Marks” means the trade names, logos, trademarks, and service marks provided by MediaNet, directly or indirectly, to Company for use hereunder, including, without limitation, any icons.

 

1.28 “MediaNet Materials” means, collectively, any content, links, functionality, technology and/or other materials provided by MediaNet in connection with this Agreement or otherwise owned, operated, marketed or distributed by MediaNet, including but not limited to the MediaNet System, MediaNet Marks, MediaNet’s Web Services and other information, technology and materials provided or used by MediaNet hereunder, including, without limitation, all related patents, patent rights, trademarks, service marks, copyrights, works of authorship, trade secrets and other proprietary interests. For the avoidance of doubt, the tangible and personal property rights (as distinguished from the intellectual property rights) in and to the digitized and/or encoded files of the Sound Recordings and Core Metadata provided to Company hereunder shall be owned by MediaNet and be deemed MediaNet Materials.

 

1.29 “MediaNet Server” means, individually or collectively, those dedicated servers supporting the MediaNet Service including but not limited to the download servers and licensing servers.

 

1.30 “MediaNet Service” has the meaning set forth in Section 2.2.

 

1.31 “MediaNet Software”***.

 

1.32  “MediaNet System” means all systems of MediaNet associated with the MediaNet Service, including, without limitation, the MediaNet Software, MediaNet Server and Equipment.

 

1.33 ***

 

1.34 “MediaNet Web Services” ***

 

1.35 ***

 

1.36 “Off-Site Cache” has the meaning set forth in Section 2.10.

 

1.37 “Renewal Term” has the meaning set forth in Section 8.1.

 

1.38 “Registered Device” means a hardware device and its associated software and firmware code that is compatible with the Company Service and the Specifications and is able to respect the usage rules and security requirements as set forth herein and in the Content Supplier Agreements, through which an End User may access Sound Recordings.

 

1.39 ***

 

1.40 “Sound Recording(s)” means an audio-only embodiment of performances of musical works or spoken-word performances.

 

1.41 “Specifications” means the terms of use, description of design, technical and functional capabilities, of the MediaNet Service, MediaNet Software and Equipment, including compatible software, and other attributes of the MediaNet System, all as set forth in this Agreement and exhibits hereto or as otherwise may be provided to Company by MediaNet.

 

	 
	
Page 3 of 22

	

 

1.42 “Stream” (as a noun) means the digital transmission made in the process of Streaming.

 

1.43 “Stream” or “Streaming” (as a verb or gerund) means the single, encrypted digital transmission of a Sound Recording, or any part thereof, via the Internet, which transmission is contemporaneous with the End User being able to hear (via a Registered Device) the recording embodied therein and which is not intended to be stored by the End User on the End User’s Registered Device (other than ephemerally on the End User’s Registered Device), except to the extent that the Sound Recording remains accessible for future listening from a local cache on the Registered Device when such Registered Device is not able to connect to the Internet, subject to the rights granted to Company by the Content Suppliers.

 

1.44 “Term” has the meaning set forth in Section 8.1.

 

1.45 “Territory” means the United States and its territories and possessions.

 

1.46 “Tier 1 Support” means the provision of customer support directly to End Users.

 

1.47 “Tier 2 Support” means the provision of support to Company technical and customer service representatives to assist in the resolution of issues related to Tier 1 Support.

 

1.48 “Usage Data” means the number of Streams that take place through the Company Services and the total number of End Users using the Company Service.

 

1.49 “User Data” means any information with respect to an End User, including passwords, name, age, physical address, and email address.

 

2. Provision of Service 

 

2.1 Company Service. The Company Service will be made available to End Users through the Company Application in accordance with the terms of this Agreement. Except as otherwise set forth in this Section 2, Company will be solely responsible for all aspects of the Company Service, including, without limitation:

 

	 	
a.

	
End User Interface. Company will be solely responsible for the maintenance and operation of the End User interface at its own expense.

	 	
 

	 
	 	
b.

	
Registration. The registration process for the Company Service will be created and managed by Company. Company will ensure that, prior to it providing the Company Service to an End User, such End User must be subject to an End User Agreement. Company agrees that if an End User does not accept such terms of service, such End User will be prohibited and prevented from accessing or using the Company Service.

	 	
 

	 
	 	
c.

	
Hosting. Company will host the Company Service, excluding the MediaNet Service, on its own servers or third party servers.

	 	
 

	 
	 	
d.

	
Compliance. Company shall be solely responsible for ensuring that the Company Service and the End Users’ Registered Players are in compliance with the Content Supplier Agreements and this Agreement at all times, including, without limitation, any usage restrictions set forth therein.

	 	
 

	 
	 	
e.

	
Billing. Company will be responsible for all billing to End Users and will be responsible for all expenses associated therewith (e.g., credit card fees). 

	 	
 

	 
	 	
f.

	
Customer Support. Company will provide, or cause to be provided, Tier 1 Support. Company will bear the cost for all Tier 1 Support.

	 	
 

	 
	 	
g.

	
Company Integration Environment. Company will provide MediaNet with access to an “integration environment” of the Company Service, which is a replica of the Company Service provided to MediaNet for the purposes of development and testing the Company Service with the MediaNet System, which will be updated as necessary by Company to reflect any updates or changes with the Company Service.

 

	 
	
Page 4 of 22

	

 

2.2 Elements of the MediaNet Service. The “MediaNet Service” consists of the MediaNet Web Services and the services described in this Section 2.2. The MediaNet Service is the so called “back end” of the Company Service and enables and provides for the delivery of Sound Recordings to End Users. The MediaNet Web Services must be implemented and operated in accordance with the Specifications. MediaNet will provide the following services to Company as part of the MediaNet Service:

 

	 	
a.

	
Encoding. MediaNet will encode the Sound Recordings in the formats set forth on Exhibit E, subject to the rights granted to Company by the Content Suppliers.

	 	
 

	 
	 	
b.

	
Hosting. MediaNet will host the MediaNet Service on its own servers or third party servers.

	 	
 

	 
	 	
c.

	
Catalog. MediaNet will make available to Company a catalog of Sound Recordings made available to MediaNet by the Content Suppliers for use on the Company Service, on a non-exclusive basis and subject to any third party restrictions, (the “Catalog”); provided, however, that Company and/or MediaNet, as the case may be, has obtained the rights necessary to make such Sound Recordings, including the underlying musical works, available to End Users through the Company Service.

	 	
 

	 
	 	
d.

	
Core Metadata. The Core Metadata will be provided to Company in an electronic XML file (“Core Metadata Feed”), which will be made available to Company in its entirety on a monthly basis and incrementally updated throughout each month of the Term.

	 	
 

	 
	 	
e.

	
Content Guide Data. MediaNet will make available to Company an electronic XML file containing the Content Guide Data (the “Content Guide Data Feed”) for use in connection with the Company Service. Company must display any attribution statements provided to Company by MediaNet in connection with the Content Guide Data in a clear and legible location and font, the size of which shall be consistent with the associated text and/or image. Company acknowledges and agrees that the Images are provided to Company at no cost solely for display in connection with the Application pursuant to this Agreement. Company further agrees that it is solely responsible for obtaining all clearances and consents to use the Images in connection with the Company Service.

	 	
 

	 
	 	
f.

	
MediaNet Support. MediaNet will provide Company with support to enable the resolution with respect to the MediaNet Services, including, without limitation, appointing a dedicated account manager, technical support during Company’s integration of such services and the launch of the Company Service, and ongoing technical support in connection with such services.

	 	
 

	 
	 	
g.

	
Customer Support. MediaNet will provide, or cause to be provided, Tier 2 Support.

 

	 
	
Page 5 of 22

	

 

2.3 Clearances, Reporting & Payments. Company will obtain all Clearances and will administer and timely pay (or cause to be timely paid) all fees and royalties pursuant to such Clearances, including to any record company, publisher, artist, composer, producer, mechanical and union royalties and fees which may become payable as a result of the distribution of the Sound Recordings and the underlying musical works through the Company Service throughout the Territory. Upon the mutual agreement of the parties, Company may opt to take advantage of Clearances for the Sound Recordings obtained by MediaNet through its agreements with independent record labels in accordance with such agreements, and in such event Company will not be required to obtain the applicable Clearances for the content covered by such agreements. Notwithstanding the foregoing and to the extent Company pays MediaNet the Content Supplier Costs on a timely basis, MediaNet will pay (or cause to be paid) all royalties due to the record labels and music publishers pursuant to the Clearances. In the event any Content Supplier Agreements impose additional obligations upon MediaNet (including any reporting requirements that are not part of MediaNet’s standard reporting processes), all work required by MediaNet to comply with such obligations will be deemed professional services subject to Section 3.1(e).

 

2.4 Removal of Content. With respect to all content provided hereunder, the parties agree that upon the request of MediaNet by any rightsholder, which is communicated to Company, including, without limitation, via the Core Metadata Feed, Company will promptly discontinue the availability of any such content through the Company Service in accordance with such takedown request. Additionally, MediaNet may discontinue the availability of any Sound Recordings made available to Company in the Catalog to the extent it determines, in its sole discretion, that Company has not obtained the rights to make such Sound Recordings and/or the underlying musical works available through the Company Service, and in such event, Company will promptly discontinue the availability of such Sound Recordings through the Company Service.

 

2.5 Launch. The parties will work together in an effort to launch the Company Service as soon as commercially practicable after the Effective Date. The date upon which the Company Service is launched will be referred to as the “Launch Date.”

 

2.6 Retained Rights. As between the parties, and except as otherwise set forth in this Agreement and subject to the restrictions set forth in Section 7.2, MediaNet retains all right, title and interest in and to the MediaNet Materials and the MediaNet Marks, and Company retains all right, title and interest in and to the Company Marks and the Company Materials. Each party reserves all rights not expressly granted to the other party under this Agreement.

 

2.7 Branding. Company will include MediaNet attribution branding on the Company Service in an “about us” or similar page. Furthermore, in the event that Company includes the branding of any third-party content or services provider on the Company Application or within the Company Service, Company will include MediaNet attribution branding in a location and manner no less favorable than that of any such third party. Any MediaNet branding to be used by Company pursuant to this Section 2.7 will be provided by MediaNet.

 

2.8 Restrictions Company will comply with all restrictions set forth in the Content Supplier Agreement. Company will further comply with the following restrictions applicable to the MediaNet Service and the MediaNet Materials.

 

	 	
a.

	
Company may not use the MediaNet Materials for any improper or illegal purpose.

	 	
 

	 
	 	
b.

	
Company may not resell, redistribute or authorize the resale or redistribution of the MediaNet Materials or any element thereof to any third party.

	 	
 

	 
	 	
c.

	
Company may not modify, create derivative works of, reverse engineer, disassemble, decompile, or otherwise attempt to derive the source code or underlying trade secrets of the MediaNet Service.

	 	
 

	 
	 	
d.

	
Subject to the terms and conditions herein, Company may not sublicense, copy, distribute, transfer or lease the MediaNet Materials or any component thereof to any third party.

 

	 
	
Page 6 of 22

	

 

	 	
e.

	
Company may not use the MediaNet Service to build or contribute to any other third party content or music service. Company may make the Company Service available through co-branded versions of the Company Application, provided that, (i) the Company Application remains in Company’s sole control at all times, and (ii) all such co-branding is pre-approved by MediaNet in writing on a case-by-case basis (such approval may not be unreasonably withheld). In no event will the Company Service or Company Application be made available on a “white label” basis.

	 	
 

	 
	 	
f.

	
The Company Service may not (i) cause, control, encourage, induce, facilitate, promote or advertise activities, products or services that are illegal (including the illegal copying or unauthorized distribution of third party copyrighted material), violent, defamatory or discriminatory; (ii) display or advertise pornography; (iii) sell or advertise products or services for alcohol, tobacco, firearms or gambling; (iv) endorse any religious cause, political position or political candidate; or (v) engage in any activities that may be deemed objectionable by Content Suppliers in their sole discretion, including linking to objectionable web sites.

	 	
 

	 
	 	
g.

	
Company may not (i) access (or attempt to access) the MediaNet Service by any means other than through the MediaNet Web Service, unless otherwise authorized by MediaNet in writing; (ii) make copies of any element, or portion thereof, associated with the MediaNet Service, unless otherwise agreed to by MediaNet, provided that any use of such elements or portions for Company marketing purposes will be subject to MediaNet’s reasonable prior written approval; (iii) cache or save local copies of any Sound Recordings, except as otherwise authorized by MediaNet in writing; (iv) make use of any MediaNet Materials other than in accordance with the terms of this Agreement; or (v) unless authorized by Company through its Content Supplier Agreements or otherwise, or cleared independently by Company or by a third party on behalf of Company, make any use (directly or indirectly) of names or likenesses provided by MediaNet of any artist, record company and/or any other persons contributing to the recording or creation of any Sound Recordings in advertisements, promotions, press releases or marketing materials for the Company Service.

	 	
 

	 
	 	
h.

	
Company will use standards customary in the industry to restrict access to or use of the Company Service to End Users who are located in the Territory and Company will not be permitted to intentionally market or promote outside the Territory the availability of the Company Service. For example and without limiting the foregoing, Company will not place advertisements in media published for, or circulated to, consumers outside of the Territory. For the avoidance of doubt, this Section is not intended to restrict advertising or marketing on the Internet within the Territory, it being understood that such online marketing and promotions for the Company Service may be accessible outside the Territory.

	 	
 

	 
	 	
i.

	
Unless otherwise authorized by the applicable Content Supplier, the Core Metadata and front-cover album artwork, must be used by Company solely in connection with the sale and promotion of the applicable content to which such data relates (e.g., front-cover album artwork may only be made available in connection with the performance and/or promotion of the applicable content on or through the Company Service), as determined by MediaNet in its sole discretion.

	 	
 

	 
	 	
j.

	
Unless otherwise authorized, Company will not use the MediaNet Materials as an endorsement of any party or service, including but not limited to, Company.

 

	 
	
Page 7 of 22

	

 

2.9 ***

 

2.10 Off-Site Cache. MediaNet and Company agree to enter into good faith discussions regarding a possible off-site cache of Sound Recordings for use by Company in connection with the Company Service (“Off-Site Cache”). Except for those obligations specifically enumerated in the first sentence of this Section 2.10, neither party will have any obligations with respect to the Off-Site Cache unless otherwise memorialized in an instrument signed by authorized signatories of the parties.

 

3. Financial Terms

 

3.1 Payment Model.

 

	 	
a.

	
***

	 	
 

	 
	 	
b.

	
***

	 	
 

	 
	 	
c.

	
***

	 	
 

	 
	 	
d.

	
Content Supplier Costs. On a monthly basis, Company will pay MediaNet all Content Supplier Costs for which MediaNet is obligated to pay the Content Suppliers pursuant to Section 2.3.

	 	
 

	 
	 	
e.

	
Professional Services & Materials. Additional professional services, including, but not limited to, any technical assistance and customization to the Company Service required by Company (e.g., creation of custom catalogs, any customization to MediaNet reporting and/or payment processes required by Company or a Content Supplier Agreement), other than specifically described herein, may be provided by MediaNet at its then current rate, but not less than $250 per hour. MediaNet reserves the right to refuse any request for any such additional technical support or professional service. Additionally, the cost of any materials requested by Company used in connection with the Company Service, other than those specified herein, will be paid for by Company. MediaNet reserves the right to refuse any request for any such additional materials.

	 	
 

	 
	 	
f.

	
Coding Fees and Rights. Company is responsible for paying Coding Fees, if applicable.

	 	
 

	 
	 	
g.

	
MediaNet Fees. The parties acknowledge and agree that the MediaNet Fees are in consideration for providing access to, maintaining, upgrading and the ongoing development of and improvements to the infrastructure and technologies provided by MediaNet to Company hereunder, which such fees under all circumstances shall be separate and distinct from any and all Content Supplier Costs.

 

3.2 Advertising. The Company may sell advertising in connection with the Company Service subject to the restrictions set forth in the Content Supplier Agreements. In the event any Content Supplier (e.g., record company, music publisher or performing rights organization) requires from Company, as a part of their overall compensation for the distribution of their content on the Company Service, a participation in sums received by Company from advertising sales in connection with the Company Service, Company will pay such Content Supplier Costs as set forth herein. Company will report to MediaNet on a monthly basis in a format mutually agreed by the parties detailing the advertising revenue received by Company, so long as such reporting is necessary for MediaNet’s reporting to the Content Suppliers. In addition, Company will be responsible for serving the advertisements and any costs associated with the inclusion of such advertisements. MediaNet will incur no costs in connection with advertising on the Company Service.

 

	 
	
Page 8 of 22

	

 

4. Payment Terms and Audits

 

4.1 Payment Terms. All amounts due to MediaNet hereunder will be paid by Company to MediaNet within thirty (30) days following receipt of an invoice from MediaNet (or, if a shorter period is required by a Content Supplier, such shorter period as mutually agreed by the parties to enable compliance with the applicable Content Supplier requirements), with the exception of *** which will be paid upon the applicable payment dates set forth in Section 3.1, above. All amount set forth in this Agreement are in United States Dollars. All payments will be made by Company to MediaNet in United States Dollars and by wire transfer directed to:

 

***

 

or to such other account as identified by MediaNet from time to time. Company will pay MediaNet without setoffs or deductions.

 

4.2 Invoice. Within ten (10) days from the end of each month, MediaNet will provide Company with an invoice which will be accompanied by an accurate (to the best of MediaNet’s knowledge) report containing a description and calculation of the applicable payments for the period concerned in detail sufficient to support the calculations of the amounts due. Acceptance by the Company of any report furnished shall not preclude the Company from questioning its correctness and, in the event that any inconsistencies or mistakes are discovered by Company, Company will provide written notice of such to MediaNet and the parties will discuss in good faith such inconsistencies or mistakes and rectify such as applicable. Notwithstanding the foregoing, all such reports will be deemed accepted by Company if Company does not provide MediaNet written notice of any such inconsistencies or mistakes within six (6) months following the date such report is issued to Company by MediaNet. Company will also submit the information set forth on Exhibit C upon request.

 

4.3 Taxes. Each party will be responsible for and pay all taxes, including sales, use, or value-added taxes, duties, withholding taxes and other assessments now or hereafter imposed, that arise as a consequence of the sale of products through their respective services or payments made to the other pursuant to this Agreement. If Company is required to collected taxes on behalf of any Content Supplier, within four (4) business days from the end of each month of the Term, Company will pay to MediaNet all applicable taxes and report such to MediaNet through MediaNet Web Services, so long as MediaNet is administering such reporting and payments to Content Suppliers. For the avoidance of doubt, Company will be solely responsible for all sales tax associated with the Company Service, and any withholding taxes assessed on payments to MediaNet hereunder.

 

4.4 Audit Rights. Company and MediaNet will maintain books and records with respect to sums payable to MediaNet hereunder. Either party may, at its own expense no more than once per calendar year and not more than once with respect to any period, hire a third party independent auditor to examine and make extracts of the other party’s books and records only as they relate to the payment of sums due to MediaNet hereunder. The examining party may make those examinations only during the other party’s usual business hours, at the place where such party keeps the books and records and on reasonable prior written notice (not less than thirty (30) days). Such books and records will be kept at the Company’s and MediaNet’s headquarters, respectively.

 

4.5 Interest. Company will pay interest, if any, at the rate of two-thirds of one percent (.667%) per month, or the maximum rate permitted by law, whichever is less, from the date due, on any required payment that is not made on or before its due date, without prejudice to any other rights MediaNet may have in connection such delinquency.

 

	 
	
Page 9 of 22

	

 

4.6 MediaNet Reporting. MediaNet will provide a monthly feed or report which provides Usage Data regarding Streams of Sound Recordings, as applicable, during the previous month, which feed or report may be modified from time to time.

 

4.7 Company Reporting. No later than ten (10) days following the end of each month of the Term (or, if a shorter period is required by a Content Supplier, such shorter period as mutually agreed by the parties to enable compliance with the applicable Content Supplier requirements), Company will provide MediaNet with a reporting feed which provides all information MediaNet requires to report to the Content Suppliers as set forth herein in a MediaNet prescribed format, which feed may include, but not be limited to, the number of End Users using the Company Service, total number of plays (including the plays of Streams from the Streaming Cache Reproduction) and total revenue from the Company Service, (the “Company Usage Report”).

 

4.8 Additional Company Reports about the Company Service. Upon request by MediaNet, Company will provide MediaNet with reports which set forth, with respect to the Company Service, such information as MediaNet reasonably may require to meet any reporting or auditing obligations that MediaNet may owe to third parties in connection with this Agreement.

 

5. Publicity

 

The parties will issue a joint press release regarding their relationship under this Agreement upon execution of this Agreement. Neither party will issue any other press release or make any other public statement regarding the existence of this Agreement or any of the terms or conditions of this Agreement without the prior written consent of the other party. MediaNet acknowledges that this Agreement may be deemed to be a “Material Contract” as that term is defined by Item 601(b)(10) of Regulation S-K, and that the Company may therefore be required to file such document as an exhibit to registration statements or reports filed under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. In the event that, in the written opinion of Company’s counsel, this Agreement is deemed a Material Contract and Company is required to include this Agreement as an exhibit to any such registration statements or reports, Company will provide MediaNet with written notice of such, redact from the Agreement all sensitive terms and information in consultation with MediaNet, prior to the filling of such registration statements or reports and request that this Agreement be accorded confidential treatment by the recipients of such registration statements or reports.

 

6. Data & MediaNet Reporting

 

6.1 User Data. User Data will be the sole property of Company. Company will treat such information in accordance with Company’s privacy policy, and in accordance with all applicable laws, rules and regulations.

 

6.2 Usage Data. Usage Data will be the joint property of MediaNet and Company. MediaNet and Company will treat such information in accordance with their respective privacy policies, and in accordance with all applicable laws, rules and regulations.

 

6.3 Other Data. All other data generated in connection with the Company Service will be owned by MediaNet if generated by MediaNet or its affiliates, and will be owned by Company if generated by Company or its affiliates.

 

	 
	
Page 10 of 22

	

 

7. Use of Marks and Materials

 

7.1 License.

 

	 	
a.

	
MediaNet hereby grants to Company, and Company hereby accepts, the limited, royalty-free, nontransferable, nonexclusive right during the Term (without the right to sublicense) to use, reproduce, distribute, and publicly display the MediaNet Materials in the Territory only for the purposes of fulfilling its obligations under this Agreement.

	 	
 

	 
	 	
b.

	
Company hereby grants to MediaNet, and MediaNet hereby accepts, the limited, royalty-free, nontransferable, nonexclusive right during the Term (without the right to sublicense) to use, reproduce, distribute, and publicly display the Company Materials in the Territory only for the purposes of fulfilling its obligations under this Agreement.

	 	
 

	 
	 	
c.

	
Company hereby grants to MediaNet, and MediaNet hereby accepts, the limited, royalty-free, nontransferable, nonexclusive, worldwide right during the Term to use, reproduce, distribute, transmit, and publicly display the Company Marks on MediaNet’s informational website, currently located at www.mndigital.com, and in connection with MediaNet’s marketing materials, at all times in accordance with the terms and conditions set forth herein, including without limitation Section 7.2, below. This Section 7.1(c) will survive expiration or termination of the Term for two (2) years.

 

7.2 Restrictions. Company will use the MediaNet Marks solely in accordance with all of the terms and conditions set forth herein, will exhibit and display such MediaNet Marks in the exact form provided by MediaNet (except for immaterial modifications for formatting purposes), will not make or permit the making of any copies thereof in whole or in part except as required for the purposes herein specified, will not have the right to authorize others to use such MediaNet Marks except as reasonably required for the purposes herein specified, will include all standard proprietary notices prescribed by MediaNet, and will conform its use thereof to quality standards consistent with the high level of past practices for the use thereof. All right, title and interest in and to the MediaNet Marks, including all associated goodwill, and in any copyright or other proprietary right now existing or hereinafter created pursuant to this Agreement, will remain vested in MediaNet subject only to the rights of use granted in this Agreement.

 

MediaNet will use Company Marks only in accordance with all of the terms and conditions set forth herein or as otherwise approved by Company. MediaNet will exhibit and display such Company Marks in the exact form provided by Company, will not make or permit the making of any copies thereof in whole or in part except as required for the purposes herein specified, will not have the right to authorize others to use such Company Marks, will include all standard proprietary notices prescribed by Company, and will conform its use thereof to quality standards consistent with the high level of past practices for the use thereof. All right, title and interest in and to the Company Marks, including all associated goodwill, and in any copyright or other proprietary right now existing or hereinafter created pursuant to this Agreement, will remain vested in Company subject only to the rights of use granted in this Agreement.

 

7.3 Infringements. Each party will promptly notify the other of any apparently unauthorized use or infringement by third parties of any rights granted to it herein, and will reasonably cooperate in any action at law or in equity undertaken by the other party with respect to such unauthorized use or infringement. Neither party will institute any suit or take any action in connection with any such apparently unauthorized use or infringement of any of the other party’s rights without first obtaining the prior consent of such other party to do so, and such other party will have the sole right and discretion to determine whether or not any action will be taken on account of any such unauthorized uses or infringements.

 

8. Term and Termination

 

8.1 Term. This Agreement will become effective on the Effective Date and will continue for a period of three (3) years from the end of the Beta Period (“Initial Term”). After the expiration of the Initial Term, this Agreement will automatically renew for successive one (1) year terms (each a “Renewal Term,” the Initial Term and all Renewal Terms, the “Term”), subject to the termination provisions set forth below.

 

	 
	
Page 11 of 22

	

 

8.2 Termination. Company and MediaNet will each have the right to terminate this Agreement effective immediately upon notice of a material breach of any obligation hereunder by the other party, if such material breach or failure is not cured within thirty (30) days following the date the non-breaching party gives the other party notice setting forth in reasonable detail the elements of such breach (“Breach Notice”). In addition, either party will have the right to terminate this Agreement at the conclusion of the Initial Term or the conclusion of the then current Renewal Term upon written notice received by the non-terminating party, (a) if by the Company, not less than thirty (30) days prior to the end of the Initial Term or the end of the then current Renewal Term, or, (b) if by MediaNet, not less than ninety (90) days prior to the end of the Initial Term or the end of the then current Renewal Term.

 

8.3 Events Upon Termination. Upon the expiration or termination of this Agreement for any reason, Company will promptly cease all use of the MediaNet Materials, including, without limitation, all copies of the Core Metadata Feed and Content Guide Feed, and immediately delete all full and partial copies of such MediaNet Materials from the Company Servers and Company’s computers, workstations and storage media, and, subject to Sections 7.1 and 7.2, MediaNet will promptly cease all use of Company Materials and Company Marks and immediately return such to Company. Company will provide MediaNet with written certification that all MediaNet Materials have been deleted in accordance with this Section 8.3. All payments that have accrued as of the date of termination or expiration, will be payable to MediaNet in full on such date; and all rights herein granted will revert to the granting party.

 

9. Representations and Warranties 

 

9.1 By MediaNet. MediaNet represents, warrants and covenants that (a) it has the right, power and authority to enter into this Agreement and fully perform its obligations hereunder; (b) the terms of this Agreement that are applicable to MediaNet do not and will not conflict with any agreement between it and any other party; (c) to the best of MediaNet’s knowledge, the use of MediaNet Materials do not violate or infringe any intellectual property or other right of any third party; and (d) the execution, delivery and performance of this Agreement by MediaNet has been duly authorized by all necessary corporate action. To the extent the representations and warranties set forth in Subsections (a)-(c) of this Section 9.1 address MediaNet’s right to distribute the Sound Recordings and Core Metadata, such representations and warranties shall be subject to Company’s performance of its obligation set forth in Section 2.3.

 

9.2 By Company. Company represents and warrants that (a) it has the right, power and authority to enter into this Agreement and to fully perform its obligations hereunder; (b) the terms of this Agreement that are applicable to Company do not and will not conflict with any agreement between it and any other party; (c) to the best of Company’s knowledge, the use of Company Materials does not violate or infringe any intellectual property or other right of any third party; (d) it will abide by all requirements and restrictions contained herein and in the Content Supplier Agreements; (e) the Company Service will respect and fulfill all usage rules and security requirements contained herein and in the Content Supplier Agreements; (f) the data set forth in each Company Usage Report delivered to MediaNet is true and accurate; and (g) the execution, delivery and performance of this Agreement by Company has been duly authorized by all necessary corporate action.

 

9.3 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHER PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, AND EACH PARTY EXPRESSLY DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR PERFORMANCE. NOTWITHSTANDING ANYTHING CONTAINED HEREIN, THE IMAGES ARE PROVIDED BY MEDIANET TO COMPANY AS-IS AND WITHOUT REPRESENTATIONS AND WARRANTIES OF ANY KIND WHATSOEVER. THE ENTIRE RISK ARISING OUT OF THE USE OF THE SOUND RECORDINGS, THE UNDERLYING MUSICAL WORKS, AND THE IMAGES REMAINS WITH COMPANY.

 

	 
	
Page 12 of 22

	

 

10. Indemnification

 

10.1 Indemnification By MediaNet. MediaNet will indemnify, defend and hold harmless Company, its parents, affiliates, officers, directors, consultants, employees, successors and permitted assigns from and against any and all damages, losses, costs, expenses (including reasonable attorneys’ fees) and other liabilities arising from any and all actual or threatened claims, demands or actions brought by third parties arising from (a) any breach of any of the representations or warranties or agreements made by it hereunder, and (b) a claim that MediaNet Materials infringe any intellectual property or other right(s) of such party. Company will promptly notify MediaNet of any such claim. MediaNet will bear full responsibility for the defense (including any settlements) of any such claim. MediaNet will keep Company informed of, and consult with, Company in connection with the progress of any litigation or settlement of any such claim. Company will have the right, but not the obligation, to be represented by counsel of their choice and to participate in the defense of such claim; provided, however, that the expense of such counsel and such participation will be borne by Company. MediaNet will not have any right, without Company’s written consent, which will not be unreasonably withheld or delayed, to settle any such claim.

 

10.2 Indemnification By Company. Company will indemnify, defend and hold harmless MediaNet, its parents, affiliates, officers, directors, consultants, employees, successors and permitted assigns from and against any and all damages, losses, expenses (including reasonable attorneys’ fees) and other liabilities arising from any and all actual or threatened claims, demands or actions brought by third parties arising from (a) any breach of any of the representations, warranties or agreements made by it hereunder; (b) any collection or proceeding for sales taxes, including all transaction taxes imposed on the sale of taxable property or services to consumers of such property; (c) a claim that Company Materials infringe any intellectual property or other right(s) of such party; and (d) a claim that the distribution of any Sound Recordings and/or musical works embodied therein through the Company Service infringes any intellectually property or other right(s) of such party. MediaNet will promptly notify Company of any such claim. Company will bear full responsibility for the defense (including any settlements) of any such claim. Company will keep MediaNet informed of, and consult with, MediaNet in connection with the progress of such litigation or settlement of any such claim. MediaNet will have the right, but not the obligation, to be represented by counsel of their choice and to participate in the defense of such claim; provided, however, that the expense of such counsel and such participation will be borne by MediaNet. Company will not have any right, without MediaNet’s written consent, which will not be unreasonably withheld or delayed, to settle any such claim.

 

10.3 Limitation of Liability. TO THE EXTENT PERMITTED BY APPLICABLE LAW, NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR ANY LIQUIDATED, INDIRECT, CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES (INCLUDING DAMAGES FOR LOSS OF BUSINESS OPPORTUNITY, BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION, AND THE LIKE) ARISING OUT OF THIS AGREEMENT, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; HOWEVER, THE FOREGOING LIMITATIONS WILL NOT APPLY TO AMOUNTS PAYABLE IN CONNECTION WITH EITHER PARTY’S INDEMNIFICATION OR CONFIDENTIALITY OBLIGATIONS.

 

10.4 Insurance. Company will maintain at all times during the Term and for three (3) years thereafter the following insurance with insurance carriers rated A- or better by A.M. Best: (i) commercial general liability insurance (including contractual liability), on an occurrence and not claims made basis, with at least a two million dollar ($2,000,000) limit for each occurrence, which coverage will among other things insure Company’s obligations under this Agreement; and (ii) standard errors & omissions liability insurance covering infringement of the proprietary rights of any third party, including without limitation copyright and trademark infringement as related to Company’s performance under this Agreement with minimum limits of three million dollars ($3,000,000) (provided that Company will endeavor to increase such limits to five million ($5,000,000) following the execution of this Agreement). The terms of coverage will be evidenced by certificates of insurance to be furnished to MediaNet upon execution of the Agreement and annually thereafter throughout the Term of the Agreement. All such insurance will be primary to any insurance carried by MediaNet as to matters for which Company is obligated to indemnify MediaNet under this Agreement.

 

	 
	
Page 13 of 22

	

 

11. Confidentiality

 

11.1 Definition. For the purposes of this Agreement, “Confidential Information” means (i) all non-public information of a party and its affiliates, including information relating to the Company Service and the MediaNet Service and information pertaining to such party’s business strategy, activities and operations (whether as then being conducted or proposed to be conducted), reports, ideas, concepts, know-how, techniques, technology, designs, specifications, drawings, diagrams, data, code, marketing plans, strategies, customer lists, suppliers, sources of materials, financial information, pricing information, business relationships, employees, trade secrets, and other technical or business information and any information, data or reports prepared or compiled under this Agreement and (ii) the terms of this Agreement. Confidential Information will not be deemed to include any information which (w) is publicly known at the time of the disclosure; (x) becomes publicly known other than by breach of the terms of this Agreement; (y) becomes known to the disclosing party, without restriction, from a source free of any obligation of confidentiality; or (z) is independently developed by or already in the possession of the disclosing party without the benefit of the other party’s Confidential Information, as shown by valid records.

 

11.2 Restrictions. During the term of this Agreement and for three (3) years thereafter, each party agrees (a) that it will not disclose to any third party or use any Confidential Information disclosed to it by the other except as expressly permitted in this Agreement, and (b) that it will take all reasonable measures to maintain the confidentiality of all Confidential Information of the other party in its possession or control, which will in no event be less than the measures it uses to maintain the confidentiality of its own information of similar importance. Notwithstanding the foregoing, each party may disclose Confidential Information of the other party (i) to the extent required by a court of competent jurisdiction or other governmental authority or otherwise as required by law, so long as such party notifies the other party sufficiently in advance of such disclosure to give such other party the reasonable opportunity to protect such information, or (ii) on a “need-to-know” basis, under a contractual obligation of confidentiality at least as strict as that set forth in this Section 11.2, to its legal counsel and accountants, and (with the prior approval of the disclosing party) banks and other financing sources (who are not competitors of the disclosing party) and their advisors.

 

12. Exclusivity 

 

During the Term hereof Company will neither offer access to nor advertise or market any digital music service that offers the same or substantially similar services to the Company Service through the Company Application or Company media player.

 

13. General

 

13.1 No Agency or Joint Venture. The parties agree and acknowledge that the relationship of the parties is in the nature of independent contractors. This Agreement will not be deemed to create a partnership or joint venture, and neither party is the other’s agent, partner, employee, or representative.

 

13.2 Force Majeure. If because of an act of God, fire, riot or civil commotion, act of public enemy, rule, order or act of any government or governmental instrumentality (whether federal, state, local or foreign) or other cause of a similar or different nature not reasonably within MediaNet’s or Company’s control, as applicable (a “Force Majeure Event”), a party’s performance of its obligations under this Agreement or its normal business operations are delayed or become impossible, then, such party will have the option, by giving the other party written notice, to suspend its obligations hereunder for the duration of any such Force Majeure Event, provided that such party promptly upon discovery of the Force Majeure Event uses its commercially reasonable efforts to recommence performance of the affected obligations. If any Force Majeure Event continues for a period of sixty (60) consecutive days or more, the non-affected party will have the right to terminate this Agreement effective immediately upon notice to the affected party.

 

	 
	
Page 14 of 22

	

 

13.3 Notices. Any notice, approval, consent, request, authorization, direction or other communication under this Agreement will be given in writing and will be deemed to have been delivered and given for all purposes: (i) on the delivery date if delivered personally to the party to whom the same is directed or delivered by email to the appropriate email address set forth below or confirmed facsimile to the appropriate number set forth below; (ii) one business day after deposit with a commercial overnight carrier, with written verification of receipt; or (iii) five business days after the mailing date, whether or not actually received, if sent by certified mail, return receipt requested, postage and charges prepaid, to the address of the party to whom the same is directed as set forth below (or such other address as such other party may supply by written notice).

 

	
To MediaNet:

	
To Company:

	
MediaNet Digital

2401 Elliott Avenue

Seattle, WA 98121

Attention: Legal and Business Affairs

	
CÜR Media, Inc.

2217 New London Turnpike

South Glastonbury, CT 06073

Attn: Kelly Sardo

	
Phone: (206) 269-6000

	
Phone: (860) 430-1520

	
Fax: (206) 269-6100

	
Email PDF to ksardo@curmusic.com

 

13.4 Entire Agreement, Modification, Waiver. This Agreement, including the exhibits hereto, contains the entire understanding of the parties hereto relating to the subject matter hereof and supersedes all previous agreements or arrangements between the parties hereto relating to the subject matter hereof. This Agreement cannot be changed or modified except by an instrument signed by authorized signatories of the parties. A waiver by either party of any term or condition of this Agreement in any instance will not be deemed or construed as a waiver of such term or condition for the future, or of any subsequent breach thereof. Should any provision of this Agreement be adjudicated by a court of competent jurisdiction as void, invalid or inoperative, such decision will not affect any other provision hereof, and the remainder of this Agreement will be effective as though such void, invalid or inoperative provision had not been contained herein.

 

13.5 Construction. This Agreement will be fairly interpreted and construed in accordance with its terms. Each party has had the opportunity to consult with counsel in the negotiation of this Agreement.

 

13.6 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed an original and all of which together will constitute one and the same document.

 

13.7 Remedies. To the extent permitted by applicable law, the rights and remedies of the parties provided under this Agreement are cumulative and in addition to any other rights and remedies of the parties at law or equity.

 

13.8 Headings. The titles used in this Agreement are for convenience only and are not to be considered in construing or interpreting the Agreement.

 

13.9 Governing Law. This Agreement will be governed and interpreted in accordance with the laws of the State of New York without regard to N.Y. GOB. LAW §§ 5-901 and 5-903 and principles of conflict of laws. The parties agree that any action arising out of this Agreement shall be brought in the state or federal courts located in New York, irrevocably submit to the exclusive jurisdiction of any such court and waive any objection that such party may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agree not to plead or claim the same.

 

13.10 Survival. The provisions of Sections 2.6 (“Retained Rights”), 3 (“Financial Terms”) and 4 (“Payment Terms and Audits”), solely to the extent such obligations remain outstanding under the Agreement, 6 (“Data & MediaNet Reporting”), 7.1(c) (“Use of Marks and Materials” (MediaNet’s use of Company Marks)), 8.3 (“Events upon Termination”), 9 (“Representations and Warranties”), 10 (“Indemnification”), 11 (“Confidentiality”) and 13 (“General”) will survive the expiration or earlier termination of this Agreement.

 

13.11 Assignment. Company may not assign this Agreement without MediaNet’s prior written approval, which approval shall not be unreasonably withheld

 

	 
	
Page 15 of 22

	

 

IN WITNESS WHEREOF, the duly authorized representatives of each of the parties hereto have executed this as of the Effective Date.

 

	CÜR Media, Inc.	 	MUSICNET, INC.
D/B/A MEDIANET DIGITAL, INC.	 
	 		 	
	By:	Thomas Brophy	 	By:	Frank Johnson	 
	Signature:	/s/ Thomas Brophy	 	Signature:	/s/ Frank Johnson	 
	Title:	Founder & CEO	 	Title:	Chief Executive Officer	 
	Date:	11/13/14		Date:	11/13/14	

 

	 
	
Page 16 of 22

	

 

Exhibit A

MediaNet Fees

 

***

 

 

 

	 
	
Page 17 of 22

	

 

Exhibit B

Core Metadata and Content Guide Data

 

	 	
Artist Data

	
Album Data

	
Track Data

	
Core Metadata

	
Unique Identifier

Name

	
Unique Identifier

Name

Artist Names & Roles

Art Cover

Label

Genre

Release Date

UPC

Copyright

Duration

Type (Single, EP, etc.)

Explicit Lyrics Flag

Edited Flag

Credits

Artist Importance Ratings

Liner Notes

Classical (Composers, Conductor, Ensemble)

	
Unique Identifier

Track Listing

Track Artist Names & Roles

Samples

Duration

ISRC

Disk & Track Number

	
Content Guide Data

	
Biography

Extended Biography

Artist Images

Artist Roles & Genres

Similar Artists

Relations (influences, worked with)

History

Nationality

Birth/Death Date

Years Active

Awards and Nominations

Concert Tour Schedule & Tickets

Artist Website

Social (Tweets, Facebook updates)

Links to Interviews & News

Popularity ranking

	
Album Synopsis

Other Album Versions

Original Release Date

Popularity ranking

Related Albums

	
Other track versions

Related tracks

 

	 
	
Page 18 of 22

	

 

Exhibit C

Reporting Feed Requirements

 

Upon request, Company will provide a feed or report which provides the following data:

 

	 	
·

	
Streams – plays, name & artist for each track or album, date, usage type

	 	
 

	
 

	 	
·

	
Any additional data agreed to by both parties

 

All applicable Content Supplier Costs will be paid by MediaNet to the Content Supplier (i.e., record labels and music publishers) based on the Usage Data calculated by MediaNet, and Company will pay the Content Supplier Costs based on such Usage Data as described in this Agreement.

 

	 
	
Page 19 of 22

	

 

Exhibit D

MediaNet Web Services Definitions and Terms of Use

 

***

 

 

 

	 
	
Page 20 of 22

	

 

Exhibit E

Formats and Bit-Rates

 

MediaNet will make the Sound Recordings available to Company in the following formats and bit-rates, subject at all times to Content Supplier requirements.

 

	
Format

	
Length

	
Bit Rates

	
MP3 Audio

	
Full length

	
320 kbps/256 kbps

	
Full length

	
128 kbps

	
30 second samples

	
128 kbps

	
AAC+ Audio

	
Full length

	
64 kbps

	
30 second samples

	
64 kbps

 

	 
	
Page 21 of 22

	

 

Exhibit F

 

***

 

 

 

Page 22 of 22VRTV-20140930-Exhibit 10.20

Exhibit 10.20

VERITIV CORPORATION 
DEFERRED COMPENSATION SAVINGS PLAN
Veritiv Corporation (the “Company”) hereby establishes the Veritiv Corporation Deferred Compensation Savings Plan (the “Plan”).  This Plan is effective on the Effective Date.  The purpose of the Plan is to attract and retain key employees and non-employee directors by providing such persons with an opportunity to defer receipt of a portion of their compensation as provided in the Plan.
ARTICLE I
DEFINITIONS
For purposes of the Plan, the following words and phrases shall have the meanings set forth below, unless their context clearly requires a different meaning: 
“Account” means the bookkeeping account maintained by the Committee on behalf of each Participant pursuant to this Plan.  The sum of each Participant's Sub-Accounts, in the aggregate, shall constitute his Account.  The Account and each and every Sub-Account shall be a bookkeeping entry only and shall be used solely as a device to measure and determine the amounts, if any, to be paid to a Participant or his Beneficiary under the Plan.
“Affiliated Group” means (i) the Company, and (ii) all entities with whom the Company would be considered a single employer under Sections 414(b) and 414(c) of the Code.  Such term shall be interpreted in a manner consistent with the definition of “service recipient” contained in Section 409A of the Code, except that the Company specifically elects to retain the “at least 80 percent” ownership threshold in applying Section 1563(a)(1), (2), and (3) for purposes of determining a controlled group of corporations under Section 414(b) of the Code, and in applying Treasury Regulation Section 1.414(c)-2 for purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of Section 414(c).   
“Base Salary” means the annual base rate of cash compensation payable by the Affiliated Group to an Eligible Employee during a calendar year including overtime and shift differential, but excluding Incentive Compensation, bonuses, Long-Term Transition Incentive Awards, Retention Bonuses, commissions, severance payments, qualified plan employer contributions or benefits, expense reimbursements, fringe benefits and all other similar payments, and prior to reduction for any deferrals under this Plan or any other plan of the Affiliated Groups under Sections 125 or 401(k) of the Code.   For purposes of this Plan, Base Salary payable after the last day of a calendar year solely for services performed during the final payroll period described in Section 3401(b) of the Code containing December 31 of such year shall be treated as earned during the subsequent calendar year.
“Beneficiary” or “Beneficiaries” means the person or persons, including one or more trusts, designated by a Participant in accordance with the Plan to receive payment of the remaining balance of the Participant's Account in the event of the death of the Participant prior to the Participant's receipt of the entire amount credited to his Account. 

1

“Beneficiary Designation Form” means the form established from time to time by the Committee (in a paper or electronic format) that a Participant completes, signs and returns to the Committee to designate one or more Beneficiaries.   
“Board” means the Board of Directors of the Company. 
“Code” means the Internal Revenue Code of 1986, as amended.
“Commissions” means sales commissions payable by the Affiliated Group to an Eligible Employee, under a sales commission plan, as designated by the Committee, in its sole discretion, if (i) a substantial portion of the services provided by the Participant to the Affiliated Group consist of the direct sale of a product or service to an unrelated customer, (ii) the sales commissions paid by the Affiliated Group to the Participant consist of either a portion of the purchase price for the product or service or an amount substantially all of which is calculated by reference to the volume of sales, and (iii) payment of the sales commissions is contingent upon the closing of the sales transaction and such other requirements as may be specified by the Affiliated Group before the closing of the sales transaction.  Such term shall be interpreted in a manner consistent with the definition of “sales commission compensation” contained in Section 409A of the Code.   
“Committee” means the committee appointed to administer the Plan.  Unless and until otherwise specified, the Committee under the Plan shall be the Company’s Benefit Plans Committee or its delegate(s).  
“Company” means Veritiv Corporation and its successors, including, without limitation, the surviving corporation resulting from any merger or consolidation of Veritiv Corporation with any other corporation, limited liability company, joint venture, partnership or other entity or entities. 
“Deferral Election” means the Participant's election on a form approved by the Committee to defer a portion of his Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives in accordance with the provisions of Article III.
“Director” means any individual who is a member of the Board and who is not an employee of the Company or its Affiliated Group.
“Director Fees” means the annual cash retainer for Board and committee service, special assignment fees, meeting fees, committee chair or presiding director fees, and other similar cash amounts currently payable to a Director for service to the Company as a Director.   
“Director Incentives” means such compensation payable to a Director, other than Director Fees, as the Committee, in its sole discretion, may designate as eligible for deferral in accordance with this Plan. 
“Discretionary Company Contribution” means a credit by the Company to a Participant’s Account(s) in accordance with the provisions of Article IV of the Plan, whether as a match of Eligible Employee deferrals or otherwise. Discretionary Company Contributions, if any, shall be credited at the sole discretion of the Company and the fact that a Discretionary Company Contribution may 

2

be credited in one year shall not obligate the Company to continue to make any such Discretionary Company Contribution in any subsequent year.
“Effective Date” means October 15, 2014.
“Eligible Employee” has the meaning given to such term in Section 2.1 hereof. 
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“Incentive Compensation” means cash incentive compensation payable to an Eligible Employee pursuant to the Veritiv Annual Incentive Plan and, in the sole discretion of the Committee, such other cash incentive compensation plans of the Company or another member of the Affiliated Group (whether any such plan is now in effect or hereafter established) which the Committee may designate from time to time.
“In-Service Sub-Account” means each bookkeeping In-Service Sub-Account maintained by the Committee on behalf of each Participant pursuant to Section 2.4 hereof.
 “Participant” means any Eligible Employee or Director who (i) at any time elected to defer the receipt of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives in accordance with the Plan, and (ii) in conjunction with his Beneficiary, has not received a complete payment of the amount credited to his Account.
“Pay” means a Participant’s Base Salary, Commissions, Incentive Compensation, Director Fees and Director Incentives, as applicable. 
“Performance-Based Compensation” means Incentive Compensation that is based on services performed over a period of at least twelve (12) months and that constitutes “performance-based compensation” within the meaning of Section 409A of the Code.
 “Plan” means this Veritiv Corporation Deferred Compensation Savings Plan, as it may be amended from time to time.
“Plan Year” means a calendar year.
“Separation from Service” means a termination of employment or service with the Affiliated Group, other than as a result of death, in such a manner as to constitute a “separation from service” as defined under Section 409A of the Code.  
“Separation Sub-Account” means each bookkeeping Separation Sub-Account maintained by the Committee on behalf of each Participant pursuant to Section 2.4 hereof.
“Specified Employee” means a “specified employee” as determined by the Company in accordance with Section 409A of the Code.
“Sub-Account” means each bookkeeping In-Service Sub-Account and Separation Sub-Account maintained by the Committee on behalf of each Participant pursuant to the Plan.

3

“Subsequent Payment Election” has the meaning given to such term in Section 6.2 hereof.  
“Unforeseeable Emergency” means an “unforeseeable emergency” as defined under  Section 409A of the Code.  
ARTICLE II
ELIGIBILITY; SUB-ACCOUNTS
2.1.    Selection by Committee.  Participation in the Plan is limited to (a) any employee of the Affiliated Group who (i) is expressly selected by the Committee, in its sole discretion, to participate in the Plan, and (ii) is a member of a “select group of management or highly compensated employees,” within the meaning of Sections 201, 301 and 401 of ERISA (each an “Eligible Employee”); and (b) any Director.  In lieu of expressly selecting Eligible Employees for Plan participation, the Committee may establish eligibility criteria (consistent with the requirements of clause (a)(ii) of this Section 2.1) providing for participation of all Eligible Employees who satisfy such criteria.  The Committee may at any time, in its sole discretion, change the eligibility criteria for Eligible Employees, or determine that one or more Participants will cease to be an Eligible Employee.
2.2.    Enrollment Requirements.  As a condition to participation, each selected Eligible Employee and each Director shall complete, execute and return to the Committee a Deferral Election and Beneficiary Designation Form no later than the date or dates specified by the Committee.  In addition, the Committee may establish from time to time such other enrollment requirements as it determines in its sole discretion are necessary.  
2.3.    Commencement Date.  
(a)    Each Eligible Employee shall be eligible to commence participation in accordance with the terms and conditions of this Plan effective as of January 1 of the Plan Year next following the Plan Year in which he or she is selected as an Eligible Employee pursuant to Section 2.1.  Notwithstanding the foregoing, the Committee, in its sole discretion, may permit an Eligible Employee to commence participation in the Plan upon such earlier date as may be specified by the Committee. 
(b)    Each Director serving on the Board as of the Effective Date shall be eligible to commence participation in accordance with the terms and conditions of this Plan effective as of January 1, 2015.  Each Director who first commences to serve on the Board on or after the January 1, 2015 shall be eligible to commence participation in accordance with the terms and conditions of this Plan on the date he or she commences service on the Board.  
2.4.    Sub-Accounts.  
(a)    Establishment.  The Committee shall establish and maintain separate Separation Sub-Accounts and, if applicable, one or more In-Service Sub-Accounts for each Participant.  Except as otherwise determined by the Committee, a separate Sub-Account shall be maintained for amounts credited to a Participant’s Account for each Plan Year as deferrals of Base 

4

Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives.  The Committee, in its sole discretion, may specify the maximum number (including zero) of permitted In-Service Sub-Accounts for each Participant.   Amounts credited to a Separation Sub-Account shall commence to be paid following the Participant’s Separation from Service as provided in Articles III and VI hereof.  Amounts credited to an In-Service Sub-Account shall commence to be paid in a year specified by the Participant or, if earlier, following the Participant’s Separation from Service as provided in Articles III and VI hereof.  
(b)    Adjustments.  A Participant’s Separation Sub-Account(s) and In-Service Sub-Account(s) shall be credited with deferrals of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives, if any, in accordance with Article III hereof.  Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives that a Participant elects to defer shall be credited to the applicable Sub-Account effective as of the date the Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives would otherwise have been paid to the Participant.  A Participant’s Sub-Accounts shall be credited with gains, losses and earnings as provided in Article V hereof and shall be debited for any payments made to the Participant in accordance with Article VI hereof.  
2.5.    Termination.  An individual’s right to defer Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives shall cease with respect to Plan Year following the Plan Year in which he ceases to be an Eligible Employee or Director, although such individual shall continue to be subject to all of the terms and conditions of the Plan for as long as he remains a Participant.  
ARTICLE III
DEFERRAL ELECTIONS
3.1.    Certain Newly Eligible Participants.  
(a)    Newly Eligible Employees.  The Committee, in its sole discretion, may permit an Eligible Employee to make a Deferral Election with respect to Base Salary, Commissions and/or Incentive Compensation earned during the Plan Year in which the Eligible Employee is first eligible to participate in the Plan (and in any other plan that would be aggregated with the Plan under Section 409A of the Code), as determined in accordance with Treasury Regulation Section 1.409A-2(a)(7); provided, however, that such Deferral Election (i) is made and becomes irrevocable no later than the 30th day after the date that the Eligible Employee first becomes eligible to participate in the Plan (or by such earlier date as specified by the Committee), and (ii) shall apply only to Base Salary,  Incentive Compensation and/or Commissions, as applicable, earned for services performed after the date that the Deferral Election becomes irrevocable, as determined by the Committee in accordance with Section 409A.   
(b)    Newly Eligible Directors.   The Committee, in its sole discretion, may permit a Director to make a Deferral Election with respect to Director Fees and/or Director Incentives earned during the Plan Year in which the Director first commences to serve on the Board; provided, however, that such Deferral Election (i) is made and becomes irrevocable no later than the 30th day after the date that the Director first commences to serve on the Board (or by such earlier date as 

5

specified by the Committee), and (ii) shall apply only to Director Fees and/or Director Incentives, as applicable, earned for services performed after the date that the Deferral Election becomes irrevocable, as determined by the Committee in accordance with Section 409A.   
3.2.    Annual Deferral Elections.  Unless Section 3.1 applies, each Eligible Employee may elect to defer Base Salary, Commissions or Incentive Compensation for a Plan Year and each Director may elect to defer Director Fees for a Plan Year or Director Incentives to be granted in a Plan Year, as the case may be, by filing a Deferral Election with the Committee in accordance with the following rules: 
(a)    Base Salary. The Deferral Election with respect to Base Salary must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee) of the Plan Year next preceding the Plan Year for which such Base Salary would otherwise be earned.      
(b)    Commissions.  The Deferral Election with respect to Commissions must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee) of the Plan Year next preceding the Plan Year in which the Commissions would otherwise be earned, as determined by the Committee in accordance with Section 409A.      
(c)    Incentive Compensation.  Except as may otherwise be determined by the Committee, in its sole discretion, with respect to Performance-Based Compensation, the Deferral Election with respect to Incentive Compensation must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee) next preceding the first day of the Plan Year (or other performance period) for which such Incentive Compensation would otherwise be earned, as determined by the Committee in accordance with Section 409A of the Code.    
(d)    Director Fees.    The Deferral Election with respect to Director Fees must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee) of the Plan Year next preceding the Plan Year for which such Director Fees would otherwise be earned.  
(e)    Director Incentives.  To the extent that deferral of Director Incentives is permitted by the Committee, in its sole discretion, the Deferral Election with respect to Director Incentives must be filed with the Committee by, and shall become irrevocable as of, December 31 (or such earlier date as specified by the Committee) of the Plan Year next preceding the Plan Year in which such Director Incentives are otherwise granted.
3.3.    Amount Deferred.  A Participant shall designate on the Deferral Election the portion of his Base Salary, Commissions, Incentive Compensation or, if applicable, Director Fees or Director Incentives that is to be deferred in accordance with this Article III.  Unless otherwise determined by the Committee, a Participant may defer (in 1% increments) up to 85% of his Base Salary for any Plan Year, up to 85% of his Commissions for any Plan Year, up to 85% of his Incentive Compensation 

6

for any Plan Year, up to 100% of his Director Fees for any Plan Year, and, to the extent permitted by the Committee, up to 100% of his Director Incentives for any Plan Year.   
3.4.    Elections as to Time and Form of Payment 
(a)    Allocation to Sub-Accounts.  
(i)    Allocation to Sub-Accounts.  Each Deferral Election will specify the allocation of the Participant’s deferrals to the Participant’s Sub-Accounts in accordance with this Plan. With respect to each component of Participant’s Pay (Base Salary, Commissions, Incentive Compensation, Director Fees and Director Incentives) for each Plan Year, a Participant may allocate any deferrals from such component of Pay either entirely to a Separation Sub-Account or entirely to an In-Service Sub-Account, but a Participant may not allocate a portion of his or her deferrals from a single component of Pay for a single Plan Year to both a Separation Sub-Account and an In-Service Sub-Account.  By way of illustration, and not in limitation of the foregoing, a Participant may elect to defer 25% of his Base Salary for a Plan Year either to a Separation Sub-Account or an In-Service Sub-Account in accordance with the Plan, but a Participant may not elect to defer 10% of his Base Salary for a Plan Year to an In-Service Account and 15% of his Base Salary for the same Plan Year to a Separation Sub-Account.  A Participant shall specify in his or her initial Deferral Election with respect to each Sub-Account the time and form of payment for such Sub-Account in accordance with Section 3.4(b).  
(ii)    Default.  To the extent that a Participant does not designate the Sub-Account to which deferrals of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives shall be credited on a Deferral Election as provided in this Section 3.4(a) (or such designation does not comply with the terms of the Plan), such deferrals shall be credited to the Participant’s Separation Sub-Account.
(b)    Time and Form of Payment.  
(i)    Separation Sub-Account.  A Participant shall elect, on each Deferral Election pursuant to which deferrals of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives are credited to a Separation Sub-Account with respect to a Plan Year, the time and form of payment of such Separation Sub-Account in accordance with this Section 3.4(b)(i).  A Participant may elect to receive each Separation Sub-Account either (A) in a single lump sum payable (subject to Sections 6.3, 6.4 and 6.8) within ninety (90) days after the Participant’s Separation from Service or in January of the first, second, third, fourth or fifth calendar year after the calendar year in which the Participant’s Separation from Service occurs; or (B) in a number of approximately equal annual installments over a specified period not exceeding 10 years, with such installments commencing (subject to Sections 6.3 and 6.8) in January of the first, second, third, fourth or fifth calendar year after the calendar year in which the Participant’s Separation from Service occurs.  Notwithstanding the foregoing, in no event may a Participant’s Deferral Election cause any portion of a Sub-Account to be paid after December 31 of the tenth calendar year following the year in which the Participant’s Separation from Service occurs.  By way of illustration, and not in limitation of the foregoing, if a Participant may elects for a Separation Sub-Account to be paid in installments commencing in January of the fifth calendar following the year of his Separation from 

7

Service, such Sub-Account may be payable in up to six (but no more than six) annual installments. The time and form of payment designated on each Deferral Election with respect to a Separation Sub-Account for a Plan Year will apply to all amounts credited to that Separation Sub-Account under the Plan unless changed in accordance with the rules of Section 6.2.  A Participant may choose a different time and form of payment for each separate Separation Sub-Account in accordance with this Section 3.4(b)(i).
(ii)    In-Service Sub-Account.  A Participant shall elect, on each Deferral Election pursuant to which deferrals of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives are credited to an In-Service Sub-Account with respect to a Plan Year, the calendar year in which payments will paid from that In-Service Sub-Account, which calendar year must be no earlier than the calendar year next following the Plan Year in which the applicable deferrals are to be credited to such In-Service Sub-Account.  For purposes of clarity, in no event may a Participant’s Deferral Election result in the crediting of Discretionary Company Contributions to an In-Service Sub-Account.  Subject to Sections 6.3, 6.4 and 6.8, each In-Service Sub-Account shall be paid in a single lump sum during January of the calendar year specified in the applicable Deferral Election, or, if earlier, within ninety (90) days after the Participant’s Separation from Service.  The calendar year designated on each Deferral Election with respect to an In-Service Account for a Plan Year will apply to all amounts credited to that In-Service Sub-Account under the Plan unless changed in accordance with the rules of Section 6.2.  A Participant may choose a different calendar year for payment of each separate In-Service Sub-Account in accordance with this Section 3.4(b)(ii). 
(c)    Defaults.  
(i)    Separation Sub-Account.  To the extent that a Participant does not designate the time and form of payment of a Separation Sub-Account on a Deferral Election as provided in Section 3.4(b)(i) (or such designation does not comply with the terms of the Plan), that Sub-Account shall be paid (subject to Sections 6.3, 6.4 and 6.8) in a single lump sum within ninety (90) days after the Participant’s Separation from Service.
(ii)    In-Service Sub-Account.  To the extent that a Participant does not designate the calendar year of payment of an In-Service Sub-Account on a Deferral Election as provided in Section 3.4(b)(ii) (or such designation does not comply with the terms of the Plan), that Sub-Account shall be paid (subject to Sections 6.3, 6.4 and 6.8) in a single lump sum in January of the fifth (5th) calendar year next following the Plan Year in which the applicable deferrals are credited to such In-Service Sub-Account or, if earlier, within ninety (90) days after the Participant’s Separation from Service.
3.5.    Duration and Cancellation of Deferral Elections.  
(a)    Duration.  Once irrevocable, a Deferral Election shall only be effective for the Plan Year with respect to which such election was timely filed with the Committee.  Notwithstanding the preceding sentence, the Committee may provide, in its sole discretion, that any Deferral Elections shall apply from Plan Year to Plan Year, until terminated or modified prospectively by a Participant in accordance with the terms of this Article III.  Such “evergreen” 

8

Deferral Elections will become effective with respect to an item of Base Salary, Commissions, Incentive Compensation, Director Fees or Director Incentives on the date such election becomes irrevocable under this Article III.  Except as provided in Section 3.5(b) hereof, a Deferral Election, once irrevocable, cannot be cancelled or modified during a Plan Year.
(b)    Cancellation.  
(iii)    The Committee may, in its sole discretion, cancel a Participant’s Deferral Election where such cancellation occurs by the later of the end of the Participant’s taxable year or the 15th day of the third month following the date the Participant incurs a “disability.”  For purposes of this Section 3.5(b)(i), a disability refers to any medically determinable physical or mental impairment resulting in the Participant’s inability to perform the duties of his or her position or any substantially similar position, where such impairment can be expected to result in death or can be expected to last for a continuous period of not less than six months. 
(iv)    The Committee may, in its sole discretion, cancel a Participant’s Deferral Election due to an Unforeseeable Emergency or a hardship distribution pursuant to Treasury Regulation Section 1.401(k)-1(d)(3).
(v)    If a Participant’s Deferral Election is cancelled with respect to a particular Plan Year in accordance with this Section 3.5(b), he may make a new Deferral Election for a subsequent Plan Year, as the case may be, only in accordance with Section 3.2 hereof.   
3.6.    Vested Interest in Deferrals.  Except as otherwise provided by the Committee with respect to Discretionary Company Contributions pursuant to Article IV, each Participant shall at all times have a fully vested interest in his Separation Sub-Account(s) and his In-Service Sub-Account(s).
ARTICLE IV
DISCRETIONARY COMPANY CONTRIBUTIONS
 4.1    In any Plan Year, the Committee, in its sole discretion, may, but is not required to, credit Discretionary Company Contributions to a Participant’s Account. 
4.2    Discretionary Company Contributions shall be subject to such vesting restrictions, if any, as the Committee may determine, in its sole discretion. 
4.3.    Discretionary Company Contributions, if any, shall be credited to such Sub-Account(s) and paid in such time and form of payment as determined by the Committee (which may include the crediting of Discretionary Company Contributions to a Separation Sub-Account, but not an In-Service Account, designated on a Participant’s Deferral Election in accordance with this Plan and Section 409A of the Code).  Unless otherwise determined by the Committee at the time of crediting, Discretionary Company Contributions, if any, shall be credited to a Participant’s Separation Sub-Account and shall be paid (subject to Sections 6.3, 6.4 and 6.8) in a single lump sum within ninety (90) days after the Participant’s Separation from Service.

9

ARTICLE V
CREDITING OF GAINS, LOSSES AND EARNINGS TO ACCOUNTS
To the extent provided by the Committee in its sole discretion, each Participant’s Account will be credited with gains, losses and earnings based on investment directions made by the Participant in accordance with investment deferral crediting options and procedures established from time to time by the Committee.  The Committee specifically retains the right in its sole discretion to change the investment deferral crediting options and procedures from time to time.  By electing to defer any amount under the Plan, each Participant acknowledges and agrees that the Affiliated Group is not and shall not be required to make any investment in connection with the Plan, nor is it required to follow the Participant’s investment directions in any actual investment it may make or acquire in connection with the Plan or in determining the amount of any actual or contingent liability or obligation of the Company or any other member of the Affiliated Group thereunder or relating thereto.  Any amounts credited to a Participant’s Account with respect to which a Participant does not provide investment direction shall be credited with gains, losses and earnings as if such amounts were invested in an investment option to be selected by the Committee in its sole discretion. 
ARTICLE VI
PAYMENTS
6.1.    Date of Payment of Sub-Accounts.  Except as otherwise provided in this Article VI, a Participant’s Sub-Accounts shall commence to be paid as follows:
(d)    Separation Sub-Account.  In general, the amounts credited to a Participant’s Separation Sub-Account shall be paid, or commence to be paid, following the Participant’s Separation from Service, at the time in the form of payment specified by the Participant for such Sub-Account in accordance with Section 3.4(b)(i) hereof.  
(e)    In-Service Sub-Account. In general, the amounts credited to a Participant’s In-Service Sub-Account shall be paid in at the time specified by the Participant for such Sub-Account in accordance with Section 3.4(b)(ii) hereof.  Each In-Service Sub-Account shall be paid in a single lump sum.  
(f)    Calculation of Installment Payments.  In the event that a Sub-Account is paid in installments: (i) the first installment shall commence at the time specified in Section 6.1, and each subsequent installment shall be paid on the commencement anniversary date until the Sub-Account has been fully paid; (ii) the amount of each installment shall equal the quotient obtained by dividing the Participant’s Sub-Account balance as of the end of the month immediately preceding the month of such installment payment by the number of installment payments remaining to be paid at the time of the calculation; and (iii) the amount of such Sub-Account remaining unpaid shall continue to be credited with gains, losses and earnings as provided in Article V hereof.  By way of example, if the Participant elects to receive payments of a Separation Sub-Account in equal annual installments over a period of five (5) years, the first payment shall equal 1/5 of the Separation Sub-Account balance, calculated as described in this Section 6.1(c), and the following year, the payment shall be 1/4 of the Sub-Account balance, calculated as described in this Section 6.1(c).

10

6.2.    Subsequent Payment Elections.  A Participant may elect, on a form provided by the Committee in accordance with this Section 6.2, to change the time and/or form of payment with respect to one or more of his Separation Sub-Accounts or to change the time of payment of one or more of his In-Service Sub-Accounts (a “Subsequent Payment Election”).  A Subsequent Payment Election shall be irrevocable and shall be made in accordance with the following rules:  
(a)    In General.  A Participant may make only one Subsequent Deferral Election with respect to each Sub-Account to which deferrals of a component of Pay (Base Salary, Commissions, Incentive Compensation, Director Fees and Director Incentives) are credited with respect to a Plan Year.  A Subsequent Payment Election may not take effect until at least twelve (12) months after the date on which it is accepted by the Committee.  Notwithstanding any other provision of this Section 6.2, in no event may a Subsequent Deferral Election cause any portion of a Sub-Account to be paid after December 31 of the tenth (10th) calendar year following the year in which the Participant’s Separation from Service occurs.
(b)    Separation Sub-Accounts.  A Participant may make a one-time election to delay the payment date or change the form of payment of a Separation Sub-Account in accordance with this Section 6.2 to a date or form otherwise permitted for Separation Sub-Accounts under the Plan.  Except in the event of the death or Unforeseeable Emergency of the Participant, the payment of such Sub-Account will be delayed until the fifth (5th) anniversary of the date that the Sub-Account would otherwise have been paid under the Plan if such Subsequent Payment Election had not been made (or, in the case of installment payments, which are treated as a single payment for purposes of Section 409A of the Code, until the fifth (5th) anniversary of the date that installment payments were scheduled to commence).
(c)    In-Service Sub-Accounts.  A Participant may make a one-time election to delay the payment date of an In-Service Sub-Account in accordance with this Section 6.2 to a payment date permitted for In-Service Sub-Accounts under the Plan.  Such Subsequent Payment Election must be filed with the Committee at least twelve (12) months prior to the first day of the calendar year that the Sub-Account would otherwise have been paid under the Plan.  On such Subsequent Payment Election, the Participant must delay the payment date for a period of at least five (5) years after the first day of the calendar year that the Sub-Account would otherwise have been paid under the Plan, or, if earlier, until the Participant’s Separation from Service (subject to Sections 6.3, 6.4 and 6.8). 
(d)    Acceleration Prohibited.  The Committee shall disregard any Subsequent Payment Election by a Participant to the extent such election would result in an acceleration of the time or schedule of any payment or amount scheduled to be paid under the Plan within the meaning of Section 409A of the Code.  Further, the Committee shall disregard any purported Subsequent Deferral election that does not comply with any of the terms of this Section 6.2. 
6.3.    Mandatory Six-Month Delay.  Notwithstanding any other provision of this Plan to the contrary, in no event may payments triggered by the Separation from Service of a Specified Employee be paid or commence prior to the first business day of the seventh month following the Specified Employee’s Separation from Service (or if earlier, within 90 days after the Specified Employee’s death).

11

6.4.    Death of Participant.   Notwithstanding any other provision of this Plan, in the event of the Participant’s death, the remaining amount of the Participant’s Sub-Accounts shall be paid to the Participant’s Beneficiary or Beneficiaries designated on a Beneficiary Designation Form (or, if no such Beneficiary, to the Participant’s estate) in accordance with the following rules: (i) if a Participant dies after payment of a Sub-Account has commenced, the remaining balance of such Sub-Account will continue to be paid in accordance with the payment schedule that has already commenced; and (ii) if a Participant dies before payments from a Sub-Account have commenced, such Sub-Account will be paid in a single lump sum within ninety (90) days following the date of the Participant’s death.  Each Participant shall file a Beneficiary Designation Form with the Committee at the time the Participant files an initial Deferral Election.  A Participant’s Beneficiary Designation Form may be changed at any time prior to his death by the execution and delivery of a new Beneficiary Designation Form. The Beneficiary Designation Form on file with the Committee that bears the latest date at the time of the Participant’s death shall govern.  If a Participant fails to properly designate a Beneficiary in accordance with this Section 6.4, then payment pursuant to this Section 6.4 shall be made to the Participant’s estate.
6.5.    Withdrawal Due to Unforeseeable Emergency.  A Participant shall have the right to request, on a form provided by the Committee, an accelerated payment of all or a portion of his Account in a lump sum if he experiences an Unforeseeable Emergency.  The Committee shall have the sole discretion to determine whether to grant such a request and the amount to be paid pursuant to such request.  
(a)    Determination of Unforeseeable Emergency.  Whether a Participant is faced with an unforeseeable emergency permitting a payment under this Section 6.5 is to be determined based on the relevant facts and circumstances of each case, but, in any case, a payment on account of an Unforeseeable Emergency may not be made to the extent that such emergency is or may be relieved through reimbursement or compensation from insurance or otherwise, by liquidation of the Participant’s assets, to the extent the liquidation of such assets would not cause severe financial hardship, or by cessation of deferrals under the Plan.   Payments because of an Unforeseeable Emergency must be limited to the amount reasonably necessary to satisfy the emergency need (which may include amounts necessary to pay any Federal, state, local, or foreign income taxes or penalties reasonably anticipated to result from the payment). Determinations of amounts reasonably necessary to satisfy the emergency need must take into account any additional compensation that is available if the Plan provides for cancellation of a Deferral Election upon a payment due to an Unforeseeable Emergency.  However, the determination of amounts reasonably necessary to satisfy the emergency need is not required to take into account any additional compensation that due to the Unforeseeable Emergency is available under another nonqualified deferred compensation plan but has not actually been paid, or that is available due to the Unforeseeable Emergency under another plan that would provide for deferred compensation except due to the application of the effective date provisions of Section 409A of the Code.  
(b)    Payment of Account.  Subject to Sections 6.3 and 6.8, payment on account of an Unforeseeable Emergency shall be made within thirty (30) days following the determination by the Committee that a withdrawal will be permitted under this Section 6.5.

12

6.6.    Discretionary Acceleration of Payments.  The Committee may, in its sole discretion, accelerate the time or schedule of a payment under the Plan to a time or form otherwise permitted under Section 409A of the Code in accordance with the requirements, restrictions and limitations of Treasury Regulation Section 1.409A-3(j); provided that in no event may a payment to a Specified Employee be accelerated following the Specified Employee’s Separation from Service to a date that is prior to the first business day of the seventh month following the Specified Employee’s Separation from Service (or if earlier, within 90 days after the Specified Employee’s death) unless otherwise permitted pursuant to Treasury Regulation Section 1.409A-3(j).
6.7.    Discretionary Delay of Payments.  The Committee may, in its sole discretion, delay the time or form of payment under the Plan to a time or form otherwise permitted under Section 409A of the Code in accordance with the requirements, restrictions and limitations of Treasury Regulation Section 1.409A-2(b)(7).  
6.8.    Actual Date of Payment.  To the extent permitted by Section 409A of the Code, the Committee, in its sole discretion, may cause any payment under this Plan to be made or commence on any later date that occurs in the same calendar year as the date on which payment otherwise would be required to be made under this Plan, or, if later, by the fifteenth (15th) day of the third month after the date on which payment would otherwise would be required to be made under this Plan.  Further, to the extent permitted by Section 409A of the Code, the Committee may delay payment in the event that it is not administratively possible to make payment on the date (or within the periods) specified in this Article VI, or the making of the payment would jeopardize the ability of the Company (or any entity which would be considered to be a single employer with the Company under Section 414(b) or Section 414(c) of the Code) to continue as a going concern.  Notwithstanding the foregoing, payment must be made no later than the latest possible date permitted under Section 409A of the Code.  
6.9.    Discharge of Obligations.  The payment to a Participant (or his Beneficiary or estate) of a Sub-Account in a single lump sum or the number of installments as provided  pursuant to this Plan shall discharge all obligations of the Affiliated Group to such Participant (and Beneficiary or estate) under the Plan with respect to that Sub-Account.  
ARTICLE VII
ADMINISTRATION
7.1.    General.  The Company, through the Committee, shall be responsible for the general administration of the Plan and for carrying out the provisions hereof.  In general, the Committee shall have the full power, discretion and authority to carry out the provisions of the Plan; in particular, the Committee shall have full discretion to (a) interpret all provisions of the Plan, (b) resolve all questions relating to eligibility for participation in the Plan and the amount in the Account of any Participant and all questions pertaining to claims for benefits and procedures for claim review, (c) resolve all other questions arising under the Plan, including any factual questions and questions of construction, (d) determine all claims for benefits, and (e) adopt such rules, regulations or guidelines for the administration of the Plan and take such further action as the Company shall deem advisable in the administration of the Plan.  The actions taken and the decisions made by the Committee hereunder shall be final, conclusive, and binding on all persons, including the Company, its 

13

shareholders, the other members of the Affiliated Group, Eligible Employees, Directors, Participants, and their estates and Beneficiaries.  The Committee may delegate to one or more officers of the Company, subject to such terms as the Committee shall determine, the authority to administer all or any portion of the Plan, or the authority to perform certain functions, including administrative functions.  In the event of such delegation, all references to the Committee in this Plan (other than such references in the immediately preceding sentence) shall be deemed references to such officers as it relates to those aspects of the Plan that have been delegated.  In accordance with the provisions of Section 503 of ERISA, the Committee shall provide a procedure for handling claims of Participants or their Beneficiaries under the Plan.  Such procedure shall be in accordance with regulations issued by the Secretary of Labor and shall provide adequate written notice within a reasonable period of time with respect to the denial of any such claim as well as a reasonable opportunity for a full and fair review by the Committee of any such denial.  
7.2.    Compliance with Section 409A of the Code.  It is intended that the Plan comply with the provisions of Section 409A of the Code, so as to prevent the inclusion in gross income of any amounts deferred hereunder in a taxable year that is prior to the taxable year or years in which such amounts would otherwise actually be paid or made available to Participants (or their Beneficiaries or estates). This Plan shall be construed, administered, and governed in a manner that effects such intent, and the Committee shall not take any action that would be inconsistent with such intent.  Although the Committee shall use its best efforts to avoid the imposition of taxation, interest and penalties under Section 409A of the Code, the tax treatment of deferrals under this Plan is not warranted or guaranteed.  Neither the Company, the other members of the Affiliated Group, the Board, nor the Committee (nor its delegate(s)) shall be held liable for any taxes, interest, penalties or other monetary amounts owed by any Participant, Beneficiary or other taxpayer as a result of the Plan.  Any reference in this Plan to Section 409A of the Code will also include any proposed, temporary or final regulations, or any other guidance, promulgated with respect to such Section 409A by the U.S. Department of Treasury or the Internal Revenue Service.  For purposes of the Plan, the phrase “permitted by Section 409A of the Code,” or words or phrases of similar import, shall mean that the event or circumstance shall only be permitted to the extent it would not cause an amount deferred or payable under the Plan to be includible in the gross income of a Participant or Beneficiary under Section 409A(a)(1) of the Code.
ARTICLE VIII
AMENDMENT AND TERMINATION
8.1.    Amendment.  The Company reserves the right to amend, terminate or freeze the Plan, in whole or in part, at any time by action of the Board or its delegate(s).  In no event shall any such action by the Board or its delegate(s) adversely affect any Participant or Beneficiary who has an Account, or result in any change in the timing or manner of payment of the amount of any Account (except as otherwise permitted under the Plan), without the consent of the Participant or Beneficiary, unless the Board or its delegate(s), as the case may be, determines in good faith that such action is necessary to ensure compliance with Section 409A of the Code.  To the extent permitted by Section 409A of the Code, the Committee may, in its sole discretion, modify the rules applicable to Deferral Elections and Subsequent Payment Elections to the extent necessary to satisfy the requirements of 

14

the Uniformed Service Employment and Reemployment Rights Act of 1994, as amended, 38 U.S.C. 4301-4334.
8.2.    Payments Upon Termination of Plan.  Except as otherwise provided in Section 7.6, in the event that the Plan is terminated, the amounts allocated to a Participant’s Sub-Accounts shall be paid to the Participant or his Beneficiary on the dates on which the Participant or his Beneficiary would otherwise receive payments hereunder without regard to the termination of the Plan.   
ARTICLE IX
MISCELLANEOUS
9.1.    Non-Alienation of Deferred Compensation.  Except as permitted by the Plan, no right or interest under the Plan of any Participant or Beneficiary shall, without the written consent of the Company, be (i) assignable or transferable in any manner, (ii) subject to alienation, anticipation, sale, pledge, encumbrance, attachment, garnishment or other legal process, or (iii) in any manner liable for or subject to the debts or liabilities of the Participant or Beneficiary.  Notwithstanding the foregoing, to the extent permitted by Section 409A of the Code and Section 6.6 hereof, the Committee shall honor a judgment, order or decree from a state domestic relations court which requires the payment of part or all of a Participant’s or Beneficiary’s interest under this Plan to an “alternate payee” as defined in Section 414(p) of the Code. 
9.2.    Participation by Employees of Affiliated Group Members.  Any member of the Affiliated Group may, by action of its board of directors or equivalent governing body and with the consent of the Board, adopt the Plan; provided that the Board may waive the requirement that such board of directors or equivalent governing body effect such adoption.  By its adoption of or participation in the Plan, the adopting member of the Affiliated Group shall be deemed to appoint the Company its exclusive agent to exercise on its behalf all of the power and authority conferred by the Plan upon the Company and accept the delegation to the Committee of all the power and authority conferred upon it by the Plan. The authority of the Company to act as such agent shall continue until the Plan is terminated as to the participating affiliate.  An Eligible Employee who is employed by a member of the Affiliated Group and who elects to participate in the Plan shall participate on the same basis as an Eligible Employee of the Company.   The Account of a Participant employed by a participating member of the Affiliated Group shall be paid in accordance with the Plan solely by such member to the extent attributable to Base Salary, Commissions or Incentive Compensation that would have been paid by such participating member in the absence of deferral pursuant to the Plan, unless the Board otherwise determines that the Company shall be the obligor.
9.3.    Interest of Participant.  The obligation of the Company and any other participating member of the Affiliated Group under the Plan to make payment of amounts reflected in an Account merely constitutes the unsecured promise of the Company (or, if applicable, the participating members of the Affiliated Group) to make payments from their general assets, and no Participant or Beneficiary shall have any interest in, or a lien or prior claim upon, any property of Company or any other member of the Affiliated Group.  Nothing in the Plan shall be construed as guaranteeing continued employment to any Eligible Employee or continued service on the Board for Directors.  It is the intention of the Affiliated Group that the Plan be unfunded for tax purposes and for purposes 

15

of Title I of ERISA.  The Company may create a trust to hold funds to be used in payment of its and the Affiliated Group’s obligations under the Plan, and may fund such trust; provided, however, that any funds contained therein shall remain liable for the claims of the general creditors of the Company and the other participating members of the Affiliated Group, and provided further that no assets shall be transferred to any such trust at a time or in a manner that would cause an amount to be included in the income of a Participant pursuant to Section 409A(b) of the Code. 
9.4.    Claims of Other Persons.  The provisions of the Plan shall in no event be construed as giving any other person, firm or corporation any legal or equitable right as against the Company or any other member of the Affiliated Group or the officers, employees or directors of the Company or any other member of the Affiliated Group, except any such rights as are specifically provided for in the Plan or are hereafter created in accordance with the terms and provisions of the Plan. 
9.5.    Severability.  The invalidity and unenforceability of any particular provision of the Plan shall not affect any other provision hereof, and the Plan shall be construed in all respects as if such invalid or unenforceable provision were omitted.   
9.6.    Governing Law.  Except to the extent preempted by federal law, the provisions of the Plan shall be governed and construed in accordance with the laws of the State of Delaware.
9.7.    Relationship to Other Plans.  The Plan is intended to serve the purposes of and to be consistent with any incentive compensation plan approved by the Committee for purposes of the Plan. 
9.8.    Successors.  The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of the business and/or assets of the Company expressly to assume this Plan.  This Plan shall be binding upon and inure to the benefit of the Company and any successor of or to the Company, including without limitation any persons acquiring directly or indirectly all or substantially all of the business and/or assets of the Company whether by sale, merger, consolidation, reorganization or otherwise (and such successor shall thereafter be deemed the “Company” for the purposes of this Plan), and the heirs, beneficiaries, executors and administrators of each Participant.  
9.9.    Withholding of Taxes.  Subject to Section 6.6 hereof, the Company or any other member of the Affiliated Group may withhold or cause to be withheld from any amounts deferred or payable under the Plan all federal, state, local and other taxes as shall be legally required.  The Company and each other member of the Affiliated Group shall have the right to (i) require a Participant to pay or provide for payment of the amount of any taxes that the Company or any other member of the Affiliated Group may be required to withhold with respect to amounts credited to a Participant’s Account under the Plan, or (ii) deduct from any amount of Base Salary, Commissions, Incentive Compensation or other payment otherwise payable in cash to the Participant the amount of any taxes that the Company or any other member of the Affiliated Group may be required to withhold with respect to amounts credited to a Participant’s Account under the Plan.
9.10.    Electronic or Other Media.  Notwithstanding any other provision of the Plan to the contrary, including any provision that requires the use of a written instrument, the Committee 

16

may establish procedures for the use of electronic or other media in communications and transactions between the Plan or the Committee and Participants and Beneficiaries.  Electronic or other media may include, but are not limited to, e-mail, the Internet, intranet systems and automated telephonic response systems.   
9.11.    Headings; Interpretation.  Headings in this Plan are inserted for convenience of reference only and are not to be considered in the construction of the provisions hereof.  Unless the context clearly requires otherwise, the masculine pronoun wherever used herein shall be construed to include the feminine pronoun.  
9.12.    Participants Deemed to Accept Plan.  By accepting any benefit under the Plan, each Participant and each person claiming under or through any such Participant shall be conclusively deemed to have indicated his acceptance and ratification of, and consent to, all of the terms and conditions of the Plan and any action taken under the Plan by the Board, the Committee, the Company and the other members of the Affiliated Group, in any case in accordance with the terms and conditions of the Plan.
 
[END OF DOCUMENT]

17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}]]