Document:

Exhibit 10.1

 

	
  

  	
  1345 AVENUE OF THE AMERICAS

  46TH FLOOR

  NEW YORK, NY 10105

  TEL 212 798-6100

  

 

May 13,
2010

 

VIA
FACSIMILE AND OVERNIGHT MAIL

 

CLST ASSET TRUST II

17304 Preston Road, Suite 420

Dallas, Texas 75252

 

Re: Notice of Event of Default; Reservation of Rights 

 

Ladies and Gentlemen:

 

Reference is made herein to that certain Second Amended
and Restated Revolving Credit Agreement, dated as of December 10, 2008 (as
amended, modified, supplemented or restated from time to time, the “Credit
Agreement”), by and among CLST Asset Trust II, a Delaware statutory trust,
as a borrower (the “Borrower”), FCC Finance LLC, as the servicer (the “Servicer”),
the Lenders party thereto, Fortress Credit Corp. (“Fortress”), and as
the administrative agent for the Lenders (in such capacity, the “Administrative
Agent”), U.S. Bank National Association, as the Collateral Custodian and
Lyon Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services), as the
Backup Servicer. Capitalized terms used herein but not otherwise defined shall
have the meanings assigned to such terms in the Credit Agreement.

 

We hereby call to your attention that, as of April 30,
2010, an Event Default has occurred and is continuing pursuant to Section 10.1(o) of
the Credit Agreement as a result of the three-month rolling average Class A
Default Ratio as of such date, which was 6.10%, exceeding 5.0%. Under the terms
of the Credit Agreement and the other Transaction Documents, the existence of
such an Event of Default entitles the Administrative Agent, for the benefit of
the Lenders, to exercise any and all of the rights and remedies provided in the
Credit Agreement, the Securities Account Control Agreement and other
Transaction Documents as set forth therein and/or as provided for under
applicable law, including without limitation, declaring the Variable Funding
Notes to be immediately due and payable in full without presentment, demand,
protest or notice of any kind and enforcing all rights and remedies with
respect to the Collateral.

 

The Administrative Agent and the Lenders have reserved,
and continue to reserve, their rights to, at any time, take any and all
actions, and exercise any and all rights, powers, privileges and remedies
authorized or permitted under the Credit Agreement, the Securities Account
Control Agreement or any other Transaction Document and/or applicable law, at
any time in its sole and absolute discretion. No delay by the Administrative
Agent or the Lenders in the exercise of any right, power, privilege or remedy
against the Borrowers or against any Collateral shall constitute or be deemed a
waiver of any such right, power, privilege or remedy, each of which is and
shall be expressly reserved. Furthermore, any prior or current discussions
(oral and

 

 

written)
or course of conduct between Fortress, on the one hand, and the Borrower, on
the other hand, is not and has not been intended to constitute a waiver of any
such rights, powers, privileges or remedies, or an amendment of the Credit
Agreement, the Securities Account Control Agreement or any other Transaction
Document.

 

Notwithstanding
the foregoing, Fortress, as it continues to evaluate the situation, expects and
requires that the Borrower timely comply with its respective duties and
obligations under the provisions of the Credit Agreement and the other
Transaction Documents.

 

Should
you have any questions concerning the above, please contact DeWayne Chin at
(212) 515-4659.

 

2

 

	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
  FORTRESS
  CREDIT CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  CONSTANTINE M. DAKOLIAS

  
	
   

  	
  Name:

  	
  CONSTANTINE
  M. DAKOLIAS

  
	
   

  	
  Title:

  	
  PRESIDENT

  

 

3Exhibit
10.1

 

NISKA GAS
STORAGE PARTNERS LLC

2010 LONG
TERM INCENTIVE PLAN

 

SECTION 1.                                Purpose of the
Plan.

 

The
Niska Gas Storage Partners LLC 2010 Long Term Incentive Plan (the “Plan”) has been adopted by Niska Gas
Storage Partners LLC (the “Company”).
The Plan is intended to promote the interests of the Company by providing to
Employees, Consultants and Directors incentive compensation awards based on
Units to encourage superior performance. The Plan is also contemplated to
enhance the ability of the Company and its Affiliates to attract and retain the
services of individuals who are essential for the growth and profitability of
the Company and its Affiliates and to encourage them to devote their best
efforts to advancing the business of the Company and its Affiliates.

 

SECTION 2.                                Definitions.

 

As
used in the Plan, the following terms shall have the meanings set forth below:

 

“Affiliate” means, with respect to
any Person, any other Person that directly or indirectly through one or more
intermediaries controls, is controlled by or is under common control with, the
Person in question. As used herein, the term “control” means the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise; provided, however, that with respect to
any Option granted to a Canadian Grantee, an Affiliate shall only include a
corporation that deals at non-arm’s length, within the meaning of the ITA, with
the Company.

 

“Award” means an Option, Unit
Appreciation Right, Restricted Unit, Phantom Unit, an Other Unit-Based Award, a
Unit Award granted under the Plan, or a Performance Award or Incentive Award,
and includes any tandem DERs granted with respect to a Phantom Unit.

 

“Award Agreement” means the written
or electronic agreement by which an Award shall be evidenced.

 

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

 

“Canadian Grantee” means a
Participant who is a resident of Canada for the purposes of the ITA, or who is
granted an Award under the Plan in respect of services performed in Canada for
the Company or any of its Affiliates.

 

“Cessation Date” means, subject to an
alternative definition within any Award Agreement, the date of the Participant’s
termination of, or resignation from, active employment or consulting services
with the Company, or cessation of active membership as a Director with the
Company, regardless of whether adequate or proper notice of termination or
resignation shall have been provided in respect of such cessation.  For greater clarity, subject to an
alternative treatment within any Award Agreement, a transfer of employment,
consulting or services as Director between the Company and any of its
Affiliates, or between any of the Company’s Affiliates, shall not be considered
an interruption or cessation of employment, consulting or services as Director
for any purpose of this Plan.

 

 

“Change of Control” means, and
shall be deemed to have occurred upon, a sale or other disposition, including
by liquidation or dissolution, of all or substantially all of the assets of the
Manager in one or more transactions to any Person other than an Affiliate of
the Manager that occurs during any twelve month period; provided, however, that
for purposes of this definition, the following dispositions shall not
constitute a Change of Control: (a) any acquisition by investors
(immediately prior to the transaction(s)) in the Manager for financing
purposes, as determined by the Board or the Committee in its sole discretion, (b) an
underwriter temporarily holding equity interests pursuant to an offering of
such interest; (c) any transfer of assets to an entity that is controlled
by the Company; or (d) any acquisition by any employee benefit plan (or
related trust) sponsored by the Company, the Manager or an entity controlled by
either the Company or the Manager. 
Notwithstanding the foregoing, the Committee may elect in an Award
Agreement to specify a different definition of “Change of Control” for purposes
deemed appropriate by the Committee.

 

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

 

“Committee” means the entity
appointed to administer the Plan, which may be the Board, any compensation
committee of the Board or such other committee as may be appointed by the Board
from time to time.

 

“Consultant” means an individual who
renders consulting services to the Company or its Affiliates.

 

“DER” means a contingent right,
granted in tandem with a specific Phantom Unit, to receive with respect to each
Phantom Unit subject to the Award an amount in cash, Units and/or Phantom
Units, as determined by the Committee in its sole discretion, equal in value to
the distributions made by the Company with respect to a Unit during the period
such Award is outstanding.

 

“Director” means a member of the
Board who is not an Employee or a Consultant (other than in that individual’s
capacity as a Director).

 

“Employee” means an employee of the
Company or an Affiliate of the Company.

 

“Exchange Act” means the Securities
Exchange Act of 1934, as amended.

 

“Fair Market Value” means the closing
sales price of a Unit on the principal national securities exchange or other
market in which trading in Units occurs as reported in The Wall Street Journal (or other
reporting service approved by the Committee) on the most recent date on which
Units were publicly traded preceding the date with respect to which the Fair
Market Value determination is made. If Units are not traded on a national
securities exchange or other market at the time a determination of fair market
value is required to be made hereunder, the determination of fair market value
shall be made in good faith by the Committee.

 

“Incentive Award” means a conditional
right granted to an Eligible Person under Section 6(e) of the Plan to
receive a cash payment, Unit or other Award, unless otherwise determined by the
Committee, after the end of a specified period of time.

 

2

 

“ITA” means the Income Tax Act
(Canada) and the regulations thereto, as amended.

 

“Manager” means Niska Gas Storage
Management LLC, a Delaware limited liability company.

 

“Operating Agreement” means the First
Amended and Restated Operating Agreement of Niska Gas Storage Partners LLC, as
amended from time to time.

 

“Option” means an option to purchase
Units granted under the Plan.

 

“Other Unit-Based Award” means an
award granted pursuant to Section 6(d) of the Plan.

 

“Participant” means an Employee,
Consultant or Director granted an Award under the Plan.

 

“Performance Award” means a right,
granted to a Participant under Section 6(e) of the Plan, to receive
an Award based upon performance criteria specified by the Committee, which may
be settled in cash or Units, as determined by the Committee in its sole
discretion.

 

“Person” means an individual or a
corporation, limited liability company, partnership, joint venture, trust,
unincorporated organization, association, governmental agency or political
subdivision thereof or other entity.

 

“Phantom Unit” means a notional unit
granted under the Plan that entitles the Participant to receive, at the time of
settlement, a Unit or an amount of cash equal to the Fair Market Value of a
Unit, or a combination of cash and Units, as determined by the Committee in its
sole discretion.

 

“Restricted Period” means the period
established by the Committee with respect to an Award during which the Award
remains subject to forfeiture and is not either exercisable by or payable to
the Participant, as the case may be.

 

“Restricted Unit” means a Unit
granted under the Plan that is subject to a Restricted Period.

 

“Rule 16b-3” means Rule 16b-3
promulgated by the SEC under the Exchange Act or any successor rule or
regulation thereto as in effect from time to time.

 

“SEC” means the Securities and
Exchange Commission or any successor thereto.

 

“UDR” means a distribution made by
the Company with respect to a Restricted Unit.

 

“Unit” means a common unit of the
Company as defined in the Operating Agreement (which for purposes of clarity,
as of the Effective Date of this Plan, means a Unit representing a fractional
part of the Company’s Membership Interests of all Non-Managing Members, and
having the rights and obligations specified with respect to Common Units in the
Operating Agreement, although the term “Common Unit” does not refer to, or
include, any Subordinated

 

3

 

Unit prior to its conversion into a Common Unit pursuant to the terms
of the Operating Agreement (all capitalized terms as defined in the Operating
Agreement)).

 

“Unit Appreciation Right” or “UAR” means a contingent right that
entitles the holder to receive, in cash or Units, as determined by the
Committee in its sole discretion, an amount equal to the excess of the Fair
Market Value of a Unit on the exercise date of the UAR over the exercise price
of the UAR.

 

“Unit Award” means a grant of a Unit
that is not subject to a Restricted Period.

 

SECTION 3.                                Administration.

 

Subject
to the terms of the Plan and applicable law, and in addition to other express
powers and authorizations conferred on the Committee by the Plan, the Committee
shall have full power and authority to: (i) designate Participants; (ii) determine
the type or types of Awards to be granted to a Participant; (iii) determine
the number of Units to be covered by Awards; (iv) determine the terms and
conditions of any Award; (v) determine whether, to what extent, and under
what circumstances Awards may be vested, settled, exercised, canceled, or
forfeited; (vi) interpret and administer the Plan and any instrument or
agreement relating to an Award made under the Plan; (vii) establish,
amend, suspend, or waive such rules and regulations and appoint such
agents as it shall deem appropriate for the proper administration of the Plan;
and (viii) make any other determination and take any other action that the
Committee deems necessary or desirable for the administration of the Plan. The
Committee may correct any defect or supply any omission or reconcile any
inconsistency in the Plan or an Award Agreement in such manner and to such
extent as the Committee deems necessary or appropriate. Unless otherwise
expressly provided in the Plan, all designations, determinations,
interpretations, and other decisions under or with respect to the Plan or any
Award shall be within the sole discretion of the Committee, may be made at any
time and shall be final, conclusive, and binding upon all Persons, including
the Company, any Affiliate, any Participant, and any beneficiary of any Award.

 

SECTION 4.                                Units.

 

(a)                                  Limits
on Units Deliverable.  Subject to adjustment as provided in Section 4(c),
the number of Units that may be delivered with respect to Awards under the Plan
will not exceed 3,380,474 Units.  Units
withheld from an Award to either satisfy the Participant’s, the Company’s or an
Affiliate’s tax withholding obligations with respect to the Award or pay the
exercise price of an Award shall not be considered to be Units delivered under
the Plan for this purpose. If any Award is forfeited, cancelled, exercised,
paid, or otherwise terminates or expires without the actual delivery of Units
pursuant to such Award (the grant of Restricted Units is not a delivery of
Units for this purpose), the Units subject to such Award shall again be
available for Awards under the Plan. There shall not be any limitation on the
number of Awards that may be paid in cash.

 

(b)                                 Sources
of Units Deliverable Under Awards.  Any Units
delivered pursuant to an Award shall consist, in whole or in part, of Units
held by the Company, or acquired in the open market from any Affiliate, or any
other Person, or any combination of the foregoing, as

 

4

 

determined
by the Committee in its discretion; provided, however, that any Units delivered
upon the exercise of an Option granted to a Canadian Grantee shall be
previously unissued Units.

 

(c)                                  Anti-dilution
Adjustments.  With respect to any “equity
restructuring” event that could result in an additional compensation expense to
the Company pursuant to the provisions of Statement of Financial Accounting
Standards Accounting Standards Codification Topic 718, Stock Compensation (“ASC  Topic
718”) if adjustments to Awards with respect to such event were
discretionary, the Committee shall equitably adjust the number and type of
Units covered by each outstanding Award and the terms and conditions, including
the exercise price and performance criteria (if any), of such Award to
equitably reflect such restructuring event and shall adjust the number and type
of Units (or other securities or property) with respect to which Awards may be
granted after such event. With respect to any other similar event that would
not result in an ASC Topic 718 accounting charge if the adjustment to Awards
with respect to such event were subject to discretionary action, the Committee
shall have complete discretion to adjust Awards in such manner as it deems
appropriate with respect to such other event. 
In the event the Committee makes any adjustment pursuant to the
foregoing provisions of this Section 4(c), the Committee shall make a
corresponding and proportionate adjustment with respect to the maximum number
of Units that may be delivered with respect to Awards under the Plan as
provided in Section 4(a) and the kind of Units or other securities
available for grant under the Plan.  All
adjustments under this Section 4(c) shall be made, to the extent
possible, in such manner so as to not cause any adverse tax consequences under
the ITA

 

SECTION 5.                                Eligibility.

 

Any
Employee, Consultant or Director shall be eligible to be designated a
Participant by the Committee and receive an Award under the Plan.

 

SECTION 6.                                Awards.

 

(a)                                  Options
and UARs.  The Committee shall have the authority
to determine the Employees, Consultants and Directors to whom Options and/or
UARs shall be granted, the number of Units to be covered by each Option or UAR,
the exercise price therefor, the Restricted Period and other conditions and
limitations applicable to the exercise of the Option or UAR, including the
following terms and conditions and such additional terms and conditions, as the
Committee shall determine, that are not inconsistent with the provisions of the
Plan.

 

(i)                                     Exercise
Price.  The exercise price per Unit purchasable under an Option or
subject to a UAR shall be determined by the Committee at the time the Option or
UAR is granted but may not be less than the Fair Market Value of a Unit as of
the date of grant of the Option or UAR.

 

(ii)                                  Time
and Method of Exercise.  The Committee shall determine
the exercise terms and the Restricted Period with respect to an Option or UAR
grant, which may include, without limitation, a provision for accelerated
vesting upon the achievement of specified performance goals or other events,
and the method or methods by which payment of the exercise price with respect
to an Option may be made or deemed to have been made, which may include,
without limitation, cash, check acceptable to the

 

5

 

Company, withholding Units from the Award
(except with respect to an Option granted to a Canadian Grantee), a “cashless-broker”
exercise through procedures approved by the Company, or any combination of the
above methods, having a Fair Market Value on the exercise date equal to the relevant
exercise price.

 

(iii)                               Forfeitures.  Except
as otherwise provided in the terms of the Option or UAR grant, upon a
Participant’s Cessation Date, for any reason during the applicable Restricted
Period, all unvested Options and UARs shall be forfeited by the Participant.
The Committee may, in its discretion, waive in whole or in part such forfeiture
with respect to a Participant’s Options or UARs.

 

(iv)                              Awards
Granted to Canadian Grantees.  All Options granted to a Canadian Grantee who is an Employee or a
Director shall have such terms and conditions as are necessary or desirable to
ensure that the Options are governed by Section 7 of the ITA and, unless
otherwise determined by the Committee, that the Units covered by any such
Option constitute “prescribed shares” within the meaning of Section 6204
of the regulations to the ITA.  All UARs
granted to a Canadian Grantee who is an Employee or a Director shall be
structured so as to not constitute a “salary deferral arrangement” within the
meaning of Section 248(1) of the ITA.

 

(b)                                 Restricted
Units and Phantom Units.  The Committee shall have the
authority to determine the Employees, Consultants and Directors to whom
Restricted Units and Phantom Units shall be granted, the number of Restricted
Units or Phantom Units to be granted to each such Participant, the Restricted
Period, the conditions under which the Restricted Units or Phantom Units may
become vested or forfeited and such other terms and conditions as the Committee
may establish with respect to such Awards.

 

(i)                                     DERs.  To
the extent provided by the Committee, in its discretion, a grant of Phantom
Units may include a tandem DER grant, which may provide that such DERs shall be
paid directly to the Participant, be credited to a bookkeeping account (with or
without interest in the discretion of the Committee), be “reinvested” in
Restricted Units or additional Phantom Units and be subject to the same or
different vesting restrictions as the tandem Phantom Unit Award, or be subject
to such other provisions or restrictions as determined by the Committee in its
discretion. Absent a contrary provision in the Award Agreement, upon a
distribution with respect to a Unit, DERs equal in value to such distribution
shall be paid promptly to the Participant in cash without vesting restrictions.

 

(ii)                                  UDRs.  To
the extent provided by the Committee, in its discretion, a grant of Restricted
Units may provide that the distributions made by the Company with respect to
the Restricted Units shall be subject to the same forfeiture and other
restrictions as the Restricted Unit and, if restricted, such distributions
shall be held, without interest, until the Restricted Unit vests or is
forfeited with the UDR being paid or forfeited at the same time, as the case
may be. In addition, the Committee may provide that such distributions be used
to acquire additional Restricted Units for the Participant. Such additional
Restricted Units may be subject to such vesting and other terms as the
Committee may prescribe. Absent such a restriction on the UDRs in the Award
Agreement, UDRs shall be paid promptly to the holder of the Restricted Unit
without vesting restrictions.

 

6

 

(iii)                               Forfeitures.  Except
as otherwise provided in the terms of the applicable Award Agreement, upon a
Participant’s Cessation Date, for any reason during the applicable Restricted
Period, all outstanding, unvested Restricted Units and Phantom Units awarded
the Participant shall be automatically forfeited on such Cessation Date. The
Committee may, in its discretion, waive in whole or in part such forfeiture
with respect to a Participant’s Restricted Units and/or Phantom Units.

 

(iv)                              Lapse
of Restrictions.

 

(A)                              Phantom
Units.  Upon or as soon as reasonably practical following the
vesting of each Phantom Unit, subject to the provisions of Section 8(b),
the Participant shall be entitled to settlement of such Phantom Unit and shall
receive from the Company either one Unit or an amount in cash equal to the Fair
Market Value of a Unit, or a combination of cash and Units, as determined by
the Committee in its discretion.

 

(B)                                Restricted
Units.  Upon or as soon as reasonably practical following the
vesting of each Restricted Unit, subject to satisfying the tax withholding
obligations of Section 8(b), the Participant shall be entitled to have the
restrictions removed from his or her Award so that the Participant then holds
an unrestricted Unit.

 

(v)                                 Awards
Granted to Canadian Grantees.  All Phantom Units granted to a Canadian
Grantee who is an Employee or a Director shall have such terms and conditions
as are necessary or desirable to ensure that such Phantom Units are excluded
from the definition of “salary deferral arrangement” under Section 248(1) of
the ITA by virtue of falling within either paragraph (k) or paragraph (l) of
that definition.

 

(c)                                  Unit
Awards.  Unit Awards may be granted under the Plan to such
Employees, Consultants and/or Directors and in such amounts as the Committee,
in its discretion, may select.

 

(d)                                 Other
Unit-Based Awards.  Other Unit-Based Awards may be granted
under the Plan to such Employees, Consultants and/or Directors as the
Committee, in its discretion, may select. An Other Unit-Based Award shall be an
award denominated or payable in, valued in or otherwise based on or related to
Units, in whole or in part. The Committee shall determine the terms and
conditions of any such Other Unit-Based Award. Upon or as soon as reasonably
practical following vesting, an Other Unit-Based Award may be settled, as
determined by the Committee in its sole discretion, in cash, Units (including
Restricted Units) or any combination thereof as provided in the applicable
Award Agreement.

 

(e)                                  Performance
Awards and Incentive Awards.  The right of an Employee, Consultant and/or
Director to receive a grant, and the right of a Participant to exercise or
receive a grant or settlement of any Award, and the timing thereof, may be
subject to such performance conditions as may be specified by the
Committee.  The Committee may use such
business criteria and other measures of performance as it may deem appropriate
in establishing any performance conditions, and may exercise its discretion to
reduce or increase the amounts payable under any Award subject to performance
conditions.

 

7

 

(i)                                     Performance
Goals Generally.  The
performance goals for Performance Awards or Incentive Awards shall consist of
one or more business criteria or individual performance criteria and a targeted
level or levels of performance with respect to each of such criteria, as
specified by the Committee in its sole discretion.  The Committee may determine that such
Performance Awards or Incentive Awards shall be granted, exercised, and/or
settled upon achievement of any one performance goal or that two or more of the
performance goals must be achieved as a condition to grant, exercise and/or
settlement of such Performance Awards or Incentive Awards.  Performance goals may differ for Performance
Awards or Incentive Awards granted to any one Participant or to different
Participants.

 

(ii)                                  Performance
Periods.  Achievement of performance
goals in respect of Performance Awards or Incentive Awards shall, subject to
other provisions of this Plan, be measured over a performance period of up to
ten years, as specified by the Committee.

 

(iii)                               Performance
Award or Incentive Award  Pool.  The Committee may, but is not required to,
establish a Performance Award pool or an Incentive Award pool which shall be an
unfunded pool, for purposes of measuring performance of the Company in
connection with Performance Awards or Incentive Awards.  The amount of such pools, if any, shall be based
upon the achievement of a performance goal or goals based on one or more
criteria during the given performance period, as specified by the
Committee.  The Committee may specify the
amount of the applicable pool as a percentage of any of such criteria, a
percentage thereof in excess of a threshold amount, or as another amount which
need not bear a strictly mathematical relationship to such criteria.

 

(iv)                              Settlement
of Performance Awards and  Incentive Awards.  After the end of each applicable performance
period, the Committee shall determine the amount, if any, of (A) the
Performance Award or Incentive Award pool, and the maximum amount of the
potential Award payable to each Participant in the Performance Award or
Incentive Award pool, or (B) the amount of the potential Performance Award
or Incentive Award otherwise payable to each Participant.  Settlement of such Performance Awards or
Incentive Awards shall be in cash, Units, other Awards or other property, in
the discretion of the Committee.

 

(f)                                    General.

 

(i)                                     Awards
May Be Granted Separately, Together or as a Substitution.    Awards
may, in the discretion of the Committee, be granted either alone or in addition
to, in tandem with, or in substitution or exchange for any other Award granted
under the Plan or any award granted under any other plan of the Company or any
Affiliate, or of any business entity to be acquired by the Company or any of
its Affiliates, or any other right of an Eligible Person to receive payment
from the Company or any of its Affiliates. 
Awards granted in addition to or in tandem with other Awards or awards
granted under any other plan of the Company or any Affiliate may be granted
either at the same time as or at a different time from the grant of such other
Awards or awards.  If an Award is granted
in substitution or exchange for another Award, the Committee shall

 

8

 

require the surrender of such other Award in
consideration for the grant of the new Award.

 

(ii)                                  Limits
on Transfer of Awards.

 

(A)                              Except as
provided in Paragraph (C) below, each Option and Unit Appreciation
Right shall be exercisable only by the Participant during the Participant’s
lifetime, or by the Person to whom the Participant’s rights shall pass by will
or the laws of descent and distribution.

 

(B)                                Except as
provided in Paragraph (C) below, no Award and no right under any such
Award may be assigned, alienated, pledged, attached, sold or otherwise
transferred or encumbered by a Participant and any such purported assignment,
alienation, pledge, attachment, sale, transfer or encumbrance shall be void and
unenforceable against the Company or any Affiliate.

 

(C)                                To the extent
specifically provided by the Committee with respect to an Option or Unit
Appreciation Right, an Option or Unit Appreciation Right may be transferred by
a Participant without consideration to immediate family members or related
family trusts, limited partnerships or similar entities or on such terms and
conditions as the Committee may from time to time establish.

 

(iii)                               Term
of Awards.  Subject to the other provisions of this
Plan or restrictions within any Award agreement, the term of each Award shall
be for such period as may be determined by the Committee.

 

(iv)                              Issuance
of Units.  The Units purchased or delivered
pursuant to an Award may be evidenced in any manner deemed appropriate by the
Committee in its sole discretion, including but not limited to, in the form of
a certificate issued in the name of the Participant or by book entry,
electronic or otherwise, subject to such stop transfer orders and other
restrictions as the Committee may deem advisable under the Plan or the rules,
regulations, and other requirements of the SEC, any stock exchange upon which
such Units or other securities are then listed, and any applicable federal or
state laws, and the Committee may cause a legend or legends to be inscribed on
any certificates to make appropriate reference to such restrictions.

 

(v)                                 Consideration
for Grants.  Awards may be granted for such
consideration, including services, as the Committee shall determine.

 

(vi)                              Delivery
of Units or other Securities and Payment by Participant of Consideration.  Notwithstanding anything in the Plan or any
Award Agreement to the contrary, delivery of Units pursuant to the exercise,
vesting and/or settlement of an Award may be deferred for any period during
which, in the good faith determination of the Committee, the Company (or any
Affiliate) is not reasonably able to obtain Units to deliver pursuant to such
Award without violating applicable law or the applicable rules or
regulations of any governmental agency or authority or securities exchange. No
Units or other securities shall be delivered pursuant to any Award until
payment in full of any amount required to be paid pursuant to the Plan or the
applicable Award Agreement

 

9

 

(including, without limitation, any exercise
price or tax withholding) is received by the Company.

 

SECTION 7.                                Amendment and
Termination.

 

Except
to the extent prohibited by applicable law:

 

(a)                                  Amendments
to the Plan and Awards.  Except as otherwise required by
the rules of the principal securities exchange on which the Units are
traded, by the Code, by the ITA, or by the Exchange Act, the Board or the
Committee may amend, alter, suspend, discontinue, or terminate the Plan in any
manner, including increasing the number of Units available for Awards under the
Plan, without the consent of any member of the Company, Participant, other
holder or beneficiary of an Award, or any other Person.  Notwithstanding the foregoing, the Committee
may waive any conditions or rights under, amend any terms of, or alter any
Award theretofore granted, provided no change, other than pursuant to Section 7(b) below,
in any Award shall materially reduce the rights or benefits of a Participant
with respect to an Award without the consent of such Participant.

 

(b)                                 Actions
Upon the Occurrence of Certain Events.  Upon the
occurrence of a Change of Control, unless the Committee has provided otherwise
within an applicable award agreement, the restrictions and/or any outstanding
vesting provisions with regard to Restricted Units or Phantom Units shall
immediately lapse.  Upon the occurrence
of a Change of Control; a recapitalization, reorganization, merger,
consolidation, combination, exchange or other relevant change in capitalization
of or involving the Company; any change in applicable law or regulation
affecting the Plan or Awards thereunder; or any change in accounting principles
affecting the financial statements of the Company, the Committee, in its sole
discretion, without the consent of any Participant or holder of the Award, and
on such terms and conditions as it deems appropriate, may, but is not required
to, take any one or more of the following actions in order to prevent dilution
or enlargement of the benefits or potential benefits intended to be made
available under the Plan or an outstanding Award:

 

(i)                                     provide for
either (A) the cancellation and termination of any Award in exchange for
an amount of cash, other property, or securities, if any, equal to the amount
that would have been attained upon the exercise of such Award or realization of
the Participant’s rights or if Participant were a unitholder as of the date of
the occurrence of such event (and, for the avoidance of doubt, if as of the
date of the occurrence of such transaction or event the Committee determines in
good faith that no amount would have been attained upon the exercise of such
Award or realization of the Participant’s rights, then such Award may be
terminated by the Company without payment) or (B) the replacement of such
Award with or the conversion of such Award into cash or other securities,
rights or property selected by the Committee in its sole discretion; provided,
that the Committee will not take any action that would result in a Participant
becoming subject to the adverse tax consequences imposed by a violation of Section 409A
of the Code or by virtue of a taxable disposition under the ITA as a result of
such action;

 

(ii)                                  provide that such
Award be assumed by the successor or survivor entity, or a parent or subsidiary
thereof, or be exchanged for similar options, rights or awards

 

10

 

covering the equity of the successor or
survivor, or a parent or subsidiary thereof, or cash or other property with
appropriate adjustments as to the number and kind of equity interests or cash
or other property and prices, provided, however, in the discretion of the
Committee, the vesting schedule applicable to such Award may be retained;
provided, that the Committee will not take any action that would result in a
Participant becoming subject to the adverse tax consequences imposed by a
violation of Section 409A of the Code or Section 7(1.4) of the ITA as
a result of such action;

 

(iii)                               make
adjustments in the number and type of Units (or other securities or property)
subject to outstanding Awards, and in the number and kind of outstanding Awards
or in the terms and conditions of (including the exercise price), and the
vesting and performance criteria included in, outstanding Awards, or both;

 

(iv)                              provide that,
such Award shall be exercisable or payable, notwithstanding anything to the
contrary in the Plan or the applicable Award Agreement;

 

(v)                                 provide that, such
Award shall be fully vested and/or nonforfeitable; and

 

(vi)                              provide that
the Award cannot be exercised or become payable after such event, i.e., shall terminate upon such event.

 

Notwithstanding
the foregoing, with respect to an above event that is an “equity restructuring”
event that would be subject to a compensation expense pursuant ASC Topic 718,
the provisions in Section 4(c) shall control to the extent they are
in conflict with the discretionary provisions of this Section 7.

 

SECTION 8.                                General Provisions.

 

(a)                                  No
Rights to Award.  No Person shall have any claim to be
granted any Award under the Plan, and there is no obligation for uniformity of
treatment of Participants. The terms and conditions of Awards need not be the
same with respect to each recipient.

 

(b)                                 Tax
Withholding.  Unless other arrangements have been
made that are acceptable to the Company, the Company or any Affiliate is
authorized to withhold from any Award, from any payment due or transfer made
under any Award or from any compensation or other amount owing to a Participant
the amount (in cash, Units, Units that would otherwise be issued pursuant to
such Award or other property) of any applicable taxes payable in respect of the
grant or settlement of an Award, its exercise, the lapse of restrictions
thereon, or any other payment or transfer under an Award or under the Plan and
to take such other action as may be necessary in the opinion of the Company to
satisfy its or the Affiliate’s withholding obligations for the payment of such taxes.

 

(c)                                  No
Right to Employment or Services.  The grant of an
Award shall not be construed as giving a Participant the right to be retained
in the employ of the Company or any Affiliate, to continue consulting services
or to remain as a Director, as applicable. Furthermore, the Company or an
Affiliate may at any time dismiss a Participant from employment or consulting
free from any liability or any claim under the Plan, unless otherwise expressly
provided in the Plan, any Award Agreement or other agreement.

 

11

 

(d)                                 Governing
Law.  The validity, construction, and effect of the Plan and any
rules and regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware without regard to its
conflicts of laws principles.

 

(e)                                  Severability.  If
any provision of the Plan or any Award is or becomes or is deemed to be
invalid, illegal, or unenforceable in any jurisdiction or as to any Person or
Award, or would disqualify the Plan or any Award under any law deemed
applicable by the Committee, such provision shall be construed or deemed
amended to conform to the applicable law or, if it cannot be construed or
deemed amended without, in the determination of the Committee, materially altering
the intent of the Plan or the Award, such provision shall be stricken as to
such jurisdiction, Person or Award and the remainder of the Plan and any such
Award shall remain in full force and effect.

 

(f)                                    Other
Laws.  The Committee may refuse to issue or transfer any Units or
other consideration under an Award if, in its sole discretion, it determines
that the issuance or transfer of such Units or such other consideration might
violate any applicable law or regulation, the rules of the principal securities
exchange on which the Units are then traded, or entitle the Company or an
Affiliate to recover the same under Section 16(b) of the Exchange
Act, and any payment tendered to the Company by a Participant, other holder or
beneficiary in connection with the exercise of such Award shall be promptly
refunded to the relevant Participant, holder or beneficiary.

 

(g)                                 No
Trust or Fund Created.  Neither the Plan nor any Award
shall create or be construed to create a trust or separate fund of any kind or
a fiduciary relationship between the Company or any participating Affiliate and
a Participant or any other Person. To the extent that any Person acquires a
right to receive payments from the Company or any participating Affiliate
pursuant to an Award, such right shall be no greater than the right of any
general unsecured creditor of the Company or any participating Affiliate.

 

(h)                                 No
Fractional Units.  No fractional Units shall be issued or
delivered pursuant to the Plan or any Award, and the Committee shall determine
in its sole discretion whether cash, other securities, or other property shall
be paid or transferred in lieu of any fractional Units or whether such
fractional Units or any rights thereto shall be terminated or otherwise
eliminated with or without consideration.

 

(i)                                     Headings.  Headings
are given to the Sections and subsections of the Plan solely as a convenience
to facilitate reference. Such headings shall not be deemed in any way material
or relevant to the construction or interpretation of the Plan or any provision
thereof.

 

(j)                                     Facility
of Payment.  Any amounts payable hereunder to any
individual under legal disability or who, in the judgment of the Committee, is
unable to manage properly his financial affairs, may be paid to the legal
representative of such individual, or may be applied for the benefit of such
individual in any manner that the Committee may select, and the Company shall
be relieved of any further liability for payment of such amounts.

 

(k)                                  Gender
and Number.  Words in the masculine gender shall
include the feminine gender, the plural shall include the singular and the
singular shall include the plural.

 

12

 

(l)                                     Compliance
with Section 409A.  Nothing in the Plan or any Award
Agreement shall operate or be construed to cause the Plan or an Award to fail
to comply with the requirements of Section 409A of the Code. The
applicable provisions of Section 409A the Code and the regulations
thereunder are hereby incorporated by reference and shall control over any Plan
or Award Agreement provision in conflict therewith.

 

SECTION 9.                                Term of the
Plan.

 

The
Plan shall be effective on the date immediately preceding the close of the
initial public offering of Units and shall continue until the earliest of (i) the
date terminated by the Board, (ii) all Units available under the Plan have
been paid to Participants, or (iii) the tenth year anniversary of the date
the Plan is approved by the Company. 
However, any Award granted prior to such termination, and the authority
of the Board or the Committee to amend, alter, adjust, suspend, discontinue, or
terminate any such Award or to waive any conditions or rights under such Award,
shall extend beyond such termination date.

 

13

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